U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
FOR THE PERIOD ENDED JULY 31, 1997
Commission file number 0-24160
CARLYLE GOLF, INC.
(Exact name of small business issuer as specified in its charter)
Colorado 84-1218066
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation)
10550 East 54th Avenue, Unit E
Denver, Colorado 80239
(Address of principal executive offices)
(303) 371-2889
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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. [X] Yes [
] No
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
Class Outstanding at September 5, 1997
Common Stock, $.001 par value 5,316,882
Transitional Small Business Disclosure Format (check one): Yes[ ] No[X]
INDEX
PAGE
PART I - Financial Information
ITEM 1 - Financial Statements
Balance Sheets 3
Statements of Operations 4
Statements of Cash Flows 5
Notes to Financial Statements 6 - 7
ITEM 2 - Management's Discussion and
Analysis of Financial Conditions
and Results of Operations 8 - 13
PART II - Other Information
ITEMS 1 through 6 14
Signature Page
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
CARLYLE GOLF, INC.
BALANCE SHEETS
JULY 31, 1997 AND OCTOBER 31, 1996
(UNAUDITED)
- -------------------------------------------------------------------------
1997 1996
------------- -------------
Assets
Current assets:
Cash $ 173,148 $2,326
Trade accounts receivable, net of
allowance of $114,460 in 1997
and $50,000 in 1996 1,677,208 585,522
Inventories 3,034,263 1,782,916
Prepaid expenses and other current
assets 307,986 150,319
---------- ----------
Total current assets 5,192,605 2,531,083
Property and equipment, at cost:
Building 800,000 -
Equipment and leasehold improvements 2,364,824 662,964
Less accumulated depreciation (432,966) (195,334)
---------- ----------
2,731,858 467,630
Goodwill and other assets, net of
amortization 1,875,729 46,223
---------- ----------
Total assets $9,800,192 $3,044,936
========== ==========
Liabilities and Stockholders' Equity
Current liabilities:
Notes payable to bank $ 2,216,266 $526,307
Term note payable to bank 166,668 -
Notes payable to stockholders 2,113,527 -
Accounts payable 1,525,795 474,599
Accrued liabilities 478,529 86,628
Obligation under purchase agreement 84,944 -
Capitalized lease obligations 57,233 -
---------- ----------
Total current liabilities 6,642,962 1,087,534
Term note payable to bank, net of
current portion 249,998
Note payable to stockholder, net of
current portion 119,808 -
Obligation under purchase agreement,
net of current portion 147,209 -
Capitalized lease obligations,
net of current portion 291,273 -
Stockholders' equity:
Preferred stock, $1.00 par value,
authorized 2,500,001 shares,
issued 1,320,432 shares 1,320,432 -
Common stock, $.001 par value,
authorized 30,000,000 shares;
issued 5,289,149 shares in 1997
and 4,871,024 in 1996 5,289 4,871
Additional paid-in capital 7,869,730 6,994,703
Compensation payable in common stock
(109,500 shares in 1997 and 77,000
shares in 1996) 184,170 117,304
Unearned compensation (123,879) (78,174)
Accumulated deficit (6,906,800) (5,081,302)
---------- ----------
Total stockholders' equity 2,348,942 1,957,402
---------- ----------
Total liabilities and stockholders'
equity $9,800,192 $3,044,936
========== ==========
CARLYLE GOLF, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED) QUARTER ENDED JULY 31, NINE MONTHS ENDED JULY 31,
------------------------ --------------------------
1997 1996 1997 1996
---------- ----------- ----------- -----------
Net revenue $2,836,354 $1,289,000 $6,741,037 $3,115,022
Cost of sales 2,132,301 1,038,782 5,102,074 2,508,232
---------- ---------- ---------- ----------
Gross profit 704,053 250,218 1,638,963 606,790
Selling, general, and
administrative
expenses 1,339,902 517,238 3,141,382 1,373,374
---------- ---------- ---------- ----------
Loss from
operations (635,849) (267,020) (1,502,419) (766,584)
Interest and other
expenses 164,777 35,390 323,079 56,015
---------- ---------- ---------- ----------
164,777 35,390 323,079 56,015
---------- ---------- ---------- ----------
Net loss from
operations $(800,626) $(302,410) $(1,825,498) $(822,599)
========== ========== =========== ==========
Net loss per common
Share $(0.15) $(0.07) $(0.35) $(0.19)
========== ========== =========== ==========
Weighted average
common shares
outstanding 5,391,258 4,572,309 5,262,035 4,385,768
========== ========== =========== ==========
See accompanying notes to financial statements.
CARLYLE GOLF, INC.
STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED JULY 31, 1997 AND 1996
(UNAUDITED) Quarter Ended Nine Months
July 31, Ended July 31,
--------------------- ---------------------
1997 1996 1997 1996
---------- --------- ----------- --------
Cash flows from operating
activities:
Net loss $(800,626) $(302,410)$(1,825,498) $(857,989)
Adjustments to reconcile
net loss to net cash
used in operating
activities:
Depreciation 105,284 27,197 237,632 79,031
Amortization of
goodwill 34,431 - 67,816 -
Amortization of
unearned
compensation 61,221 36,032 171,076 124,437
Compensation payable
in common stock (18,620) - (216,781) -
Issuance of stock for
services 98,246 - 44,252 25,228
Changes in operating
assets and liabilities:
(Increase) decrease in:
Trade receivables 323,099 (27,062) (140,598) (400,801)
Inventories 357,758 229,462 (8,713) 314,930
Prepaid expenses
and other current
assets (45,462) 44,508 (133,273) 51,959
Increase (decrease) in:
Accounts payable (237,808) (235,744) 657,688 15,546
Accrued
liabilities (80,023) 7,621 (68,700) (124,361)
Other
liabilities - - - -
--------- --------- ---------- ----------
Net cash used in
operating activities (321,082) (220,396) (1,215,099) (772,020)
--------- --------- ---------- ----------
Cash flows from investing
activities:
Net cash received in
acquisition - - 5,716 -
Purchase of property and
equipment (141,723) (22,038) (208,988) (39,895)
--------- --------- ---------- ----------
Net cash used in
investing
activities (141,723) (22,038) (203,272) (39,895)
--------- --------- ---------- ----------
Cash flows from financing
activities:
Proceeds from (repayment
of) notes payable to
bank, net (117,953) (740,840) 879,181 (185,335)
Proceeds from (repayment
of) notes payable,
stockholders, net 746,383 - 727,263 -
Repayment of capitalized
lease obligations (15,472) (1,093) (27,251) (7,602)
Proceeds from issuance of
common stock - 1,003,010 - 1,003,010
--------- --------- ---------- ----------
Net cash provided by
financing activities 612,958 261,077 1,579,193 810,073
--------- --------- ---------- ----------
Net increase (decrease)
in cash 150,153 18,643 160,822 (1,842)
--------- --------- ---------- ----------
Cash, beginning of period 22,995 35,285 12,326 55,770
--------- --------- ---------- ----------
Cash, end of period $173,148 $53,928 $173,148 $53,928
========= ========= ========== ==========
Supplemental disclosure of
cash flow information -
Cash paid for interest $105,658 $42,414 $199,606 $94,502
========= ========= ========== ==========
See accompanying notes to these financial statements.
CARLYLE GOLF, INC.
NOTES TO FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION:
The unaudited financial statements have been prepared pursuant to the rules
and regulations of the Securities and Exchange Commission. Accordingly, certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
omitted pursuant to such rules and regulations. In the opinion of management,
the accompanying financial statements contain all of the normal recurring
adjustments necessary to present fairly the financial position of the Company as
of July 31, 1997, and the results of its operations, and its cash flows for the
three months and nine months ended July 31, 1997 and 1996.
The operating results for the nine month period ended July 31, 1997 are not
necessarily indicative of the results that may be expected for the year ending
October 31, 1997. The accompanying financial statements should be read in
conjunction with the audited financial statements of the Company and notes
thereto for the fiscal year ended October 31, 1996.
2. ACQUISITION OF PRO-LINE CAP COMPANY:
On January 24, 1997, Carlyle Golf, Inc. acquired substantially all of the
assets of Star Point Enterprises, Inc. d/b/a Pro-Line Cap Company of Fort Worth,
Texas ("Pro-Line"), a producer of high quality sized and adjustable athletic and
golf headwear. The total consideration for the Pro-Line acquisition was
approximately $6.0 million. The Pro-Line acquisition was financed through a
combination of issuance of common and preferred stock and the assumption of
certain liabilities.
The Pro-Line acquisition was accounted for as a purchase, and accordingly,
the net purchase price was allocated to the various purchased assets in relation
to their fair value at the date of purchase. The results of operations of Pro-
Line have been included in the Company's results of operations from February 1,
1997, since the results for the period from January 24, 1997 to January 31, 1997
are not significant.
CARLYLE GOLF, INC.
NOTES TO FINANCIAL STATEMENTS
2. ACQUISITION OF PRO-LINE CAP COMPANY (continued):
The following table presents the unaudited pro forma results of operations
as if the Pro-Line acquisition had occurred on November 1, 1995. The summary
pro forma results are based on assumptions and are not necessarily indicative of
the results which would have occurred had the acquisition actually taken place
on such date, or of the future results of operations of the Company.
Three Months Nine Months
Ended July 31, Ended July 31,
1997 1996 1997 1996
----------- ---------- --------- ---------
as reported pro forma pro forma pro forma
Net revenue $2,836,354 $2,928,047 $6,741,037 $7,505,803
Net loss $(800,626) $(622,144) $(1,833,482)$(2,224,703)
Net loss per share $(.15) $(.13) $(.34) $(.47)
3. TERM NOTE PAYABLE TO BANK:
The Company was not in compliance with the financial covenants as of July
31, 1997, but subsequently obtained a waiver from the bank.
4. CAPITALIZED LEASE OBLIGATION:
In June 1997, the Company entered into a capital lease for $265,975 to
acquire embroidery equipment. The lease is secured by the equipment and is due
in monthly installments of principal and interest over a term of sixty months.
The interest rate on the lease is 9.9%.
5. NOTES PAYABLE TO STOCKHODERS:
In July 1997, the Company obtained a loan from its majority shareholder for
$800,000, which loan is evidenced by a promissory note. The note is secured by
accounts receivable, equipment, and inventory, which collateral is subordinated
to the security interests of Norwest Business Credit, Inc. While principal and
accrued interest on the note was due September 9, 1997, it was not paid at that
time. As a result, principal and interest are payable on demand. The interest
rate on the note is 12.5%.
CARLYLE GOLF, INC.
Item 2 - Management's Discussion and Analysis of Financial Condition and Results
of Operations
THE COMPANY
Carlyle Golf, Inc. (the "Company") has been engaged in the design, contract for
manufacture and marketing of men's golf apparel since 1992. Since February of
1997, the Company has also been engaged in the manufacture, marketing and sale
of high quality athletic headwear. The Company markets Carlyle apparel to golf
pro shops located on golf courses in the United States and throughout the world
and sells Pro-Line caps to a variety of sporting goods companies, athletic
organizations, colleges and other customers across the country. Historically,
the Company focused on developing its golf clothing products, marketing
strategy, and distribution network as the foundation for growth. In particular,
the Company obtained endorsements of its golf clothing by PGA Touring
Professionals, formed an Advisory Council comprised of 25 golf professionals
employed by golf clubs, country clubs and resorts across the country and
organized a network of experienced independent sales representatives. Since the
Pro-Line acquisition, the Company's marketing emphasis has been on capitalizing
on the natural synergies between its golf clothing line and the athletic
headwear produced by Pro-Line.
PRODUCTS
Golf Clothing. The Company's golf apparel products are currently limited to
men's clothing, including shirts, sweaters, sweater vests, windshirts, shorts
and outer wear garments. The Company is exploring the possibility of expanding
into the women's golf apparel market, through acquisition, internal product
development or otherwise, but has not yet done so.
The Company designs a broad range of golf clothing with the use of different
knits, colors and fabrics to assure that the line appeals to a wide age range of
golfers. The line is developed starting with four or five color stories so that
individuals can find variety within a color that best suits them. Accessory
garments such as sweaters and sweater vests are designed to complement the
shirts within a color story. A variety of knit fabrications are used, such as
interlock, pique, jacquard, crepe, jersey, and pima, to give each golfer the
maximum choice in his buying decision. The Company currently has approximately
60 products in each line. The Company's spring and fall lines are introduced at
major golf trade shows in January and September of each year.
The prices for the Company's golf clothing ($55-$70 suggested retail) are
between the middle and high end of the market for men's golf apparel.
Management believes that focusing on a high quality product in the upper end of
the middle market is the best strategy for long term profitability.
CARLYLE GOLF, INC.
Products (continued)
Athletic Headwear. The Company acquired substantially all of the assets of Pro-
Line Cap Company on January 24, 1997. Pro-Line produces its high-quality sized
and adjustable athletic and golf headwear in the United States. The business
combination has been accounted for as a purchase and the results of the
operations of Pro-Line are included in the Company's financial statements
beginning February 1, 1997. The headwear manufacturing and related operations
were recently consolidated from four different locations into two locations in
the Ft. Worth, Texas area.
The bulk of the Company's headwear products are baseball style caps embroidered
with the logo of various sports teams, colleges and universities and other
widely known emblems or logos. While the Company's golf-related headwear
business is a relatively small portion of Pro-Line's existing business, the
Company has established a golf headwear division and is aggressively marketing
Pro-Line products to pro shops and other golf-related customers.
The Company offers five different cap profiles, ranging from the traditional,
high crown, structured baseball cap, to the unstructured, low profile hat
popular for casual wear today. Available fabrics include 100% wool, wool
blends, cotton polyester twill or knit, as well as "soft touch" cotton and
washed denim. Besides applying the logos of well-known professional sports
teams, colleges and universities, the Company does customized embroidery work
for businesses, schools, special events and amateur athletics at all levels.
Sales and Marketing
In addition to its immediate plan to establish Pro-Line headwear as a leader in
the golf headwear market, the Company plans to enhance its marketing efforts and
increase sales by (i) promoting the Carlyle and Pro-Line names through
advertising, (ii) fostering brand recognition by the use of PGA Tour players
wearing the Company's golf clothing at golf tournaments (most of which are
televised), (iii) continuing to use an Advisory Council of PGA Club
Professionals to advise the Company on a variety of issues, (iv) increasing its
customer base by emphasizing on-time delivery and quality manufacturing and
embroidery, (v) expanding its product line, (vi) increasing its average sale per
customer, (vii) further developing the corporate market, (viii) augmenting its
relations with college golf teams to include bookstores and college golf
tournaments, (ix) enlarging its network of international distributors, and (x)
selectively acquiring other golf-related businesses that complement its existing
products.
CARLYLE GOLF, INC.
Sales and Marketing (continued)
In the United States, the Company has 33 independent sales representatives
selling Carlyle golf clothing, and 73 sales representatives, including 31 golf-
related sales representatives, selling its athletic headwear. These sales
representatives are supported by in-house support staff, including sales
management, customer service and marketing. The Company also has distributors
in the United Kingdom, Canada, Japan, Guam and Singapore.
The Company's golf clothing is represented on the Senior PGA Tour, the PGA Tour,
the Nike Tour, the European Tour, the Asian Tour, and the Japanese Tour.
Advisory Council members support the Company's apparel lines by promoting the
brand within their PGA section, wearing the product, and giving advice and
counsel on the design of each line.
The Company plans to continue to market its athletic headwear products to the
non-golf markets traditionally served by Pro-Line, but the Company's primary
focus will be on expanding its golf-related athletic headwear business by
utilizing Carlyle's golf industry marketing resources, including its network of
independent sales representatives, to sell Pro-Line athletic headwear. The
Company also believes that there may be some opportunities to sell its clothing
through Pro-Line's non-golf distribution channels, such as sales to universities
and businesses, but does not expect those sales to be material to its golf
clothing sales overall.
Facilities
The Company's business offices and distribution facility in Denver consist of
approximately 13,000 square feet of leased space used for offices, warehousing,
distribution and embroidery operations. The Company also owns a 28,000 square-
foot office building which serves as the administrative building for Pro-Line
Cap Company. The building is a two-story building located at 8224 White
Settlement Road, Ft. Worth, Texas. In addition, the Company also leases a
46,000 square-foot warehouse building at 712 Jennings in Ft. Worth, Texas, which
it uses for manufacturing and distribution.
CARLYLE GOLF, INC.
Results of Operations
Net sales for the quarter ended July 31, 1997, were $2,836,354, an increase of
$1,547,354, or 120.0%, from net sales of $1,289,000 for the same quarter in
1996. Net sales for the nine months ended July 31, 1997, were $6,741,037, an
increase of $3,626,015, or 116.4%, from net sales of $3,115,022 for the same
period in 1996. The increase in net sales is attributable to the acquisition of
substantially all the assets of Star Point Enterprises, Inc. dba Pro-Line Cap
Company and the inclusion of Pro-Line's results of operations since February 1,
1997. Additionally, the Company's sales of golf clothing increased 17.9% for
the quarter ended July 31, 1997 and 24.0% for the nine month period ended July
31, 1997 due to increased demand for its apparel products and an expansion of
its product lines.
Cost of goods sold as a percentage of net sales was 75.2% and 80.6% for the
quarters ended July 31, 1997 and July 31, 1996, respectively. The Company's
increase in gross margin from the prior year is primarily due to a smaller
proportion of sales of older inventory being sold at lower prices. Management
believes that the Company will improve its gross margin during the remainder of
1997 as a result of increased shipments of the Company's current lines and
anticipated economies of scale due to the Pro-Line acquisition.
Selling, general and administrative expenses increased as a percentage of net
sales to 46.0% for the quarter ended July 31, 1997, from 40.1% for the same
quarter in 1996. Selling, general and administrative expenses for the nine
months ended July 31, 1997 were 45.6% of net sales as compared to 44.1% for the
same period in 1996. The increase in the quarter is due to additional
advertising incurred to capitalize on the acquisition of Pro-Line, as well as
increases in catalog costs and advisory council compensation. Also included in
the quarter was approximately $45,000 of one-time moving expenses for the
consolidation of the Pro-Line facilities. The Company expects to make further
consolidations to capitalize on the synergies of the two divisions during the
remainder of fiscal 1997 and in fiscal 1998.
Loss per share was $(.15) for the quarter ended July 31, 1997 and $(.07) for the
quarter ended July 31, 1996. Loss per share was $(.35) for the nine months
ended July 31, 1997, as compared to $(.19) for the same period in 1996. The
loss per share for the quarter end periods are based on 5,391,258 and 4,572,309
weighted average shares outstanding for 1997 and 1996, respectively. The loss
per share for the nine month periods are based on 5,262,035 and 4,385,768
weighted average shares outstanding for 1997 and 1996, respectively.
The Company currently sells to domestic and foreign customers. The Company
obtains a letter of credit, when deemed necessary, on foreign sales. The
Company requires remittance in United States currency on all foreign sales.
Therefore, there is no risk associated with currency fluctuation on foreign
sales.
CARLYLE GOLF, INC.
Liquidity and Capital Resources
Since the creation of the Company in 1992, it has focused on developing its
products, marketing strategy and distribution network as the foundation for
growth and, as a result, it has incurred losses since its inception. With the
Company's entry into the athletic headwear business in February of 1997, the
Company is trying to capitalize on the complementary nature of its two product
lines to increase sales of both. The ability of the Company to achieve
profitable operations remains dependent, however, upon its ability to increase
sales and improve gross profit margins of its golf clothing and athletic
headwear lines.
The Company plans to continue to improve gross margins in its existing
operations by controlling the quantity of inventory purchases to correspond more
closely to its sales orders. The Company has concentrated on carrying the
appropriate levels of inventory to allow for growth but also dispose of older
styles of inventory in a systematic method.
The Company plans to achieve economies of scale from the acquisition of Pro-Line
Cap Company through cross penetration into each other's markets, cost savings
through increased quantity discounts on purchases and consolidation of
advertising and marketing efforts. There can be no assurance, however, that the
Company will achieve the level of sales, gross profit margins or expense
reductions to achieve profitable operations in the near term.
The Company has experienced substantial growth since 1993, with its net sales
growing from $200,000 in fiscal 1993 to over $4,000,000 in fiscal 1996. The
growth in sales has increased the Company's working capital requirements,
principally to fund the losses incurred and for increases in accounts receivable
and finished goods inventory. The Company financed its operations until August
of 1994 with a combination of bank borrowings and the sale of private equity.
From August 1994 until June 1996, the Company funded its growth through the
proceeds of its initial public offering and a bank revolving line of credit. In
June 1996, the Company sold an additional 633,873 shares of Common Stock to the
directors and management of the Company which raised net proceeds of $1,003,009.
The Company used those proceeds, plus advances under the bank line, to fund its
operations for the remainder of fiscal 1996 and the beginning of fiscal 1997.
In July 1997, the Company obtained an $800,000 short term loan from its largest
shareholder to fund its operations until additional equity financing can be
obtained. The Company expects to use the bank line of credit to fund its
operations during the remainder of fiscal 1997.
The Company is actively seeking additional capital at this time to fund its
operations and to sustain growth. There can be no assurance, however, that
sufficient capital will be available from the private or public markets in a
timely manner or on terms acceptable to the Company or at all.
CARLYLE GOLF, INC.
Liquidity and Capital Resources (continued)
Additionally, in connection with the acquisition of Pro-Line, Star Point
Enterprises loaned the Company the sum of $1,243,000, and the Company agreed to
use its best efforts to obtain additional financing, for, among other purposes,
the repayment of this loan. The loan is due on January 24, 1998.
As of July 31, 1997, the Company had $173,149 in cash and cash equivalents on
hand. As of July 31, 1997, the Company had a working capital deficit of
$1,450,357 principally as a result of the classification of the Star Point
Enterprises loan as current.
Operating activities produced negative cash flows of $321,082 for the quarter
ended July 31, 1997, and $1,215,099 for the nine months ended July 31, 1997.
The primary uses of cash were to fund the Company's year to date net loss and to
finance current inventory purchases.
The Company's investing activities were comprised of property and equipment
purchases totaling $141,723 for the quarter ended July 31, 1997, and $208,988
for the nine month period ended July 31, 1997. The purchases include leasehold
improvements, office and warehouse equipment.
Financing activities produced positive cash flows of $612,958 for the quarter
ended July 31, 1997, and $1,579,193 for the nine months ended July 31, 1997,
primarily representing advances under the Company's line of credit and proceeds
from the shareholder loan.
Forward Looking Statements
To the extent that this report includes predictions of the Company's future
performance or discloses the expectations of management of the Company as to
such performance, such statements are forward looking statements the accuracy of
which cannot be guaranteed by the Company or its management. For example, a
downturn in general economic conditions, adverse developments in the "green
grass" golf apparel industry, unanticipated problems with or delays by the
Company's cutting and sewing contractors or fabric suppliers, labor disputes,
production delays, quality control problems, or the failure of presently
anticipated funding sources to materialize or continue, among other
possibilities, could cause these forward looking statements to prove to be
incorrect.
CARLYLE GOLF, INC.
Part II - Other Information
Item 1 Legal Proceedings
Not applicable
Item 2 Changes in Securities
Not applicable
Item 3 Defaults Upon Senior Securities
Not applicable
Item 4 Submission of Matters to a Vote of Security Holders
Not applicable
Item 5 Other Information
Not applicable
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits
10 Promissory Note from the Company to
Kenneth R. LaBounty and Amy K. LaBounty Revocable Trust
dated July 10, 1997.
27 Financial Data Schedule
(b) Reports on Form 8-K
None
Carlyle Golf, Inc.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
CARLYLE GOLF, INC.
(Registrant)
Date: September 12, 1997 By: /s/ Jerome M. Hause
Jerome M. Hause,
President and Chief Operating Officer
Date: September 12, 1997 By: /s/ Wendy K. Williams
Wendy K. Williams
Chief Financial Officer
EXHIBIT INDEX
No. Description
10 Promissory Note from the Company to Kenneth R. LaBounty and
Amy K. LaBounty Revocable Trust dated July 10, 1997
27 Financial Data Schedule
All of the foregoing documents are filed herewith electronically.