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 Quarter Ended November 30, 2001
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Commission File Number 2-91218-B
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International Electronics, Inc.
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(Exact name of small business issuer as specified in its charter)
Massachusetts 04-2654231
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
427 Turnpike Street, Canton, Massachusetts 02021
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(Address of principal executive offices) (Zip Code)
(781) 821-5566
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(Issuer's telephone number, including area code)
Not applicable
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(former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Exchange Act 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 ___
---
1,568,314 common shares were outstanding at December 31, 2001.
INTERNATIONAL ELECTRONICS, INC.
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Index
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Part I. Financial Information: Page No.
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Item 1: Financial Statements (unaudited)
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Condensed Consolidated Balance Sheets, November 30, 2001
and August 31, 2001 2
Condensed Consolidated Statements of Operations, three months
ended November 30, 2001 and 2000 3
Condensed Consolidated Statement of Shareholders' Equity,
three months ended November 30, 2001 4
Condensed Consolidated Statements of Cash Flows, three
months ended November 30, 2001 and 2000 5
Notes to Condensed Consolidated Financial Statements 6-9
Item 2: Management's Discussion and Analysis of
---------------------------------------
Financial Condition and Results of Operations 10-14
---------------------------------------------
Part II. Other Information:
Item 6: Exhibits and Reports on Form 8-K 15
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Signature 15
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-1-
INTERNATIONAL ELECTRONICS, INC.
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CONDENSED CONSOLIDATED BALANCE SHEETS
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(unaudited)
Nov. 30, 2001 August 31, 2001
------------- ---------------
ASSETS
- ------
Current assets:
Cash and cash equivalents $ 1,796,737 $1,549,954
Accounts receivable, net 983,523 1,211,884
Inventories 833,451 848,742
Deferred income taxes 331,000 330,000
Other current assets 267,896 239,486
----------- ----------
Total current assets 4,212,607 4,180,066
Property and equipment, net 514,133 476,359
Other assets:
Deferred income taxes 88,000 88,000
Other 32,961 36,711
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Total other assets 120,961 124,711
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$ 4,847,701 $4,781,136
=========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Current liabilities:
Accounts payable $ 311,381 $330,627
Accrued expenses 1,083,083 987,306
Income taxes 9,000 31,000
Current portion of long-term obligations 203,339 218,066
----------- ----------
Total current liabilities 1,606,803 1,566,999
Long-term obligations 156,699 201,488
Commitments
Shareholders' equity:
Common stock, $0.01 par value:
Authorized 5,984,375 shares
Issued 1,603,314 and 1,589,313
shares, respectively 16,033 15,893
Capital in excess of par value 4,879,152 4,868,791
Accumulated deficit (1,772,342) (1,833,391)
Less treasury stock, at cost:
35,000 shares (38,644) (38,644)
----------- ----------
Total shareholders' equity 3,084,199 3,012,649
----------- ----------
$ 4,847,701 $4,781,136
=========== ==========
See notes to unaudited condensed consolidated financial statements.
-2-
INTERNATIONAL ELECTRONICS, INC.
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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(unaudited)
Three months ended
----------------------------------
Nov. 30, 2001 Nov. 30, 2000
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Net sales $ 2,645,759 $ 2,739,452
Cost of sales 1,427,915 1,471,793
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Gross profit 1,217,844 1,267,659
Research and development costs 260,073 288,093
Selling, general and
administrative expenses 891,688 994,662
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Income (loss) from operations 66,083 (15,096)
Interest expense (5,887) (8,437)
Other income 9,853 29,437
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Income before income taxes 70,049 5,904
Provision (benefit) for income taxes:
Current 10,000 8,700
Deferred (1,000) 11,000
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9,000 19,700
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Net income (loss) $61,049 ($13,796)
============= =============
Net income (loss) per share:
Basic $0.04 ($0.01)
Diluted 0.04 (0.01)
============= =============
Shares used in computing
net income (loss) per share:
Basic 1,564,607 1,536,472
Diluted 1,669,364 1,536,472
============= =============
See notes to unaudited condensed consolidated financial statements.
-3-
INTERNATIONAL ELECTRONICS, INC.
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CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
--------------------------------------------------------
(unaudited)
Common Stock Capital in Treasury Stock
------------ excess of Accumulated --------------
Shares Amount par value Deficit Shares Cost Total
------ ------ --------- ------- ------ ---- -----
Balances,
September 1, 2001 1,589,313 $ 15,893 $4,868,791 ($1,833,391) 35,000 ($38,644) $3,012,649
Exercise of
stock options 14,001 140 10,361 - - - 10,501
Net income - - - 61,049 - - 61,049
--------- -------- ---------- ----------- -------- -------- ----------
Balances,
November 30, 2001 1,603,314 $ 16,033 $4,879,152 ($1,772,342) 35,000 ($38,644) $3,084,199
========= ======== ========== =========== ======== ======== ==========
See notes to unaudited condensed consolidated financial statements.
-4-
INTERNATIONAL ELECTRONICS, INC.
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
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(unaudited)
Three months ended
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Nov. 30, 2001 Nov. 30, 2000
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CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 61,049 ($13,796)
Adjustments to reconcile net income (loss)
to net cash provided by operating
activities:
Depreciation and amortization 71,240 70,688
Deferred income taxes (1,000) 11,000
Changes in operating assets and liabilities:
Accounts receivable 228,361 195,619
Inventories 15,291 (76,788)
Other current assets (28,410) (10,180)
Income taxes (22,000) 19,700
Accounts payable and accrued
expenses 76,531 (121,872)
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Net cash provided by
operating activities 401,062 74,371
CASH FLOWS FROM INVESTING ACTIVITIES:
Net purchase of property and equipment (105,264) (25,969)
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Net cash used in investing activities (105,264) (25,969)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock 10,501 4,176
Reduction of notes payable and debt
obligations (59,516) (47,097)
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Net cash used in financing activities (49,015) (42,921)
CASH AND CASH EQUIVALENTS:
Net increase during period 246,783 5,481
Balances, beginning of period 1,549,954 1,642,359
---------- ----------
Balances, end of period $1,796,737 $1,647,840
========== ==========
See notes to unaudited condensed consolidated financial statements.
-5-
INTERNATIONAL ELECTRONICS, INC.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
(unaudited)
A. Financial Statements:
---------------------
In the opinion of International Electronics, Inc. (the "Company"), the
unaudited condensed consolidated financial statements contain all
adjustments (consisting only of normal recurring adjustments) necessary
to present fairly the financial position as of November 30, 2001 and the
results of operations for the three months then ended.
Certain disclosures normally included have been condensed or omitted
pursuant to the rules and regulations of the Securities and Exchange
Commission, although the Company believes the disclosures are adequate to
make the information presented not misleading. It is suggested that these
financial statements be read in conjunction with the financial statements
and notes thereto included in the Company's annual report on Form 10-KSB
for the year ended August 31, 2001.
B. Principles of Consolidation:
----------------------------
The accompanying condensed consolidated financial statements include the
accounts of the Company, and its majority-owned subsidiary, Ecco
Industries, Inc. ("Ecco") and its wholly owned subsidiary, International
Electronics Europe Limited. All material intercompany transactions,
balances and profits have been eliminated.
C. Income Taxes:
-------------
The Company provides for income taxes at the end of each interim period
based on the estimated effective tax rate for the full fiscal year.
Cumulative adjustments to the tax provision are recorded in the interim
period in which a change in the estimated annual effective rate is
determined.
D. Significant Estimates and Assumptions:
-------------------------------------
The preparation of consolidated financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
-6-
INTERNATIONAL ELECTRONICS, INC.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
(continued)
(unaudited)
E. Net Income (Loss) per Share:
----------------------------
Basic net income (loss) per share is computed by dividing net income
(loss) by the weighted-average common shares outstanding during the
periods. Diluted net income (loss) per share is computed by dividing net
income (loss) by the weighted-average number of common and dilutive
option and warrant shares outstanding based on the average market price
of the Company's common stock (under the treasury stock method).
The following table sets forth the computation of the weighted-average
number of shares used in calculating basic and diluted net income (loss)
per share:
Three months ended
------------------------------------
Nov. 30, 2001 Nov. 30, 2000
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Shares used in computation:
Weighted-average
shares outstanding for
basic net income
(loss) per share 1,564,607 1,536,472
Effect of dilutive option
and warrant shares 104,757 -
------------- -------------
Total shares for diluted net
income (loss) per share 1,669,364 1,536,472
============= =============
The calculations for diluted net income (loss) per share did not include an
aggregate of options and warrants of 90,000 and 191,295 for the three
months ended November 30, 2001 and 2000, respectively because such options
and warrants are anti-dilutive or are out of the money.
-7-
INTERNATIONAL ELECTRONICS, INC.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
(continued)
(unaudited)
F. New Accounting Pronouncements:
------------------------------
In June 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 141, "Business
Combinations", and SFAS No. 142, "Goodwill and Other Intangible Assets".
SFAS No. 141 requires that all business combinations initiated after June
30, 2001, be accounted for using the purchase method of accounting and
prohibits the use of the pooling-of-interests method. SFAS No. 142
eliminates the amortization of goodwill and certain other intangibles and
instead subjects these assets to periodic impairment assessments. SFAS
No. 142 is effective immediately for all goodwill and certain other
intangible assets acquired after June 30, 2001. The Company does not
expect that the implementation of SFAS No's. 141 and 142 will have a
material impact on its consolidated financial statements.
In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets". SFAS No. 144 supersedes
SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of," and the accounting and reporting
provisions of Accounting Principles Bulletin Opinion No. 30, "Reporting
the Results of Operations - Reporting the Effects of Disposal of a
Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactions". SFAS No. 144 specifies accounting for
long-lived assets to be disposed of by sale and broadens the presentation
of discontinued operations to include more disposal transactions than
were included under the previous standards. The Company is required to
implement SFAS No. 144 on September 1, 2002, and it has not determined
the impact, if any, that this statement will have on its consolidated
financial position or results of operations.
G. Long-term Obligations:
----------------------
Long-term obligations are summarized as follows:
Nov. 30, 2001 Aug. 31, 2001
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Equipment line of credit, 5.0%-6.5% (Note H) $ 360,038 $ 417,948
Collateralized 8% equipment loan - 1,606
----------- -----------
360,038 419,554
Less current portion (203,339) (218,066)
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$ 156,699 $ 201,488
=========== ===========
The aggregate principal payments on long-term obligations as of
November 30, 2001 are $203,339 (2002), $118,247 (2003) and $38,452
(2004).
-8-
INTERNATIONAL ELECTRONICS, INC.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
(continued)
(unaudited)
H. Bank Arrangements:
-----------------
As of November 30, 2001, the Company has an available $132,000 equipment
line of credit expiring February 28, 2002 and a bank demand line of
credit that provides for borrowings of up to $1,000,000. Both lines of
credit are at the bank's prime rate of interest, and all of the Company's
assets are collateralized under these arrangements. The credit agreements
contain certain restrictive covenants including covenants limiting the
payment of dividends, a minimum debt to tangible net worth ratio, and
bi-annual or annual net income. As of November 30, 2001, no borrowings
have been made under the demand line of credit, and the Company has an
aggregate of $360,038 outstanding as equipment debt, which is payable in
monthly installments through August 2004 (Note G).
I. Subsequent Event:
----------------
In December 2001, the Company increased its available equipment line of
credit by $500,000, expiring February 28, 2003 (Note H).
-9-
Management's Discussion and Analysis of
---------------------------------------
Financial Condition and Results of Operations
---------------------------------------------
Liquidity and Capital Resources
As of November 30, 2001, the Company had working capital of $2,605,804 compared
to $2,613,067 at August 31, 2001. The ratio of current assets to current
liabilities was 2.6 at November 30, 2001 and 2.7 at August 31, 2001. The debt to
equity ratio was 0.6 at both November 30, 2001 and August 31, 2001. The decrease
in working capital and current ratio is primarily the result of an increase in
accrued expenses.
Net capital expenditures were $105,264 and $25,969 for the three months ended
November 30, 2001 and 2000, respectively. The Company anticipates up to $630,000
in capital expenditures for the purchase of leasehold improvements, production
and other equipment, and tooling costs over the next twelve months.
Management believes that its current cash position, together with internally
generated funds at present sales levels and its available bank financing, will
provide adequate liquidity to satisfy its cash requirements for the next twelve
months. Depending upon whether or not sufficient revenue and working capital is
generated from profitable operations, the Company may require additional
external funding. There is no assurance that profits will be generated, or that
additional external funding will be obtainable, if such a need should arise.
Results of Operations
Net sales for the first quarter of fiscal 2002 decreased 3% as compared to the
first quarter of fiscal 2001. The decrease in net sales primarily reflects a
reduction in sales to the Company's largest distributor due to a reduction in
their inventory balances. The ratio of gross profit to sales was 46% for both
the three months ended November 30, 2001 and 2000.
Research and development expenses were $260,073 and $288,093 for the three
months ended November 30, 2001 and 2000, respectively. The decrease in these
costs is primarily due to the completion of certain development projects from
outside contractors and a reduction in project materials.
As a percentage of net sales, selling, general and administrative expenses were
34% and 36% for the three months ended November 30, 2001 and 2000, respectively.
The decrease in costs as a percentage of net sales is the result of an increase
in sales efficiency coupled with a reduction in bad debts, telecommunications
expense, public relations expense and other administrative costs.
The decrease in other income in the first quarter of fiscal 2002 compared to the
comparable period of the prior year was due to a reduction in interest income
because of lower rates on invested balances. The provision for income taxes for
the first quarter of fiscal 2002 represents state income tax expense, after
utilization of available federal net operating loss carryforwards, partially
offset by a deferred tax benefit.
-10-
New Accounting Pronouncements
In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 141, "Business Combinations", and
SFAS No. 142, "Goodwill and Other Intangible Assets". SFAS No. 141 requires that
all business combinations initiated after June 30, 2001, be accounted for using
the purchase method of accounting and prohibits the use of the
pooling-of-interests method. SFAS No. 142 eliminates the amortization of
goodwill and certain other intangibles and instead subjects these assets to
periodic impairment assessments. SFAS No. 142 is effective immediately for all
goodwill and certain other intangible assets acquired after June 30, 2001. The
Company does not expect that the implementation of SFAS No's. 141 and 142 will
have a material impact on its consolidated financial statements.
In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets". SFAS No. 144 supersedes SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
Be Disposed Of," and the accounting and reporting provisions of Accounting
Principles Bulletin Opinion No. 30, "Reporting the Results of Operations -
Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary,
Unusual and Infrequently Occurring Events and Transactions". SFAS No. 144
specifies accounting for long-lived assets to be disposed of by sale and
broadens the presentation of discontinued operations to include more disposal
transactions than were included under the previous standards. The Company is
required to implement SFAS No. 144 on September 1, 2002, and it has not
determined the impact, if any, that this statement will have on its consolidated
financial position or results of operations.
Factors that May Affect Future Results
Information provided by the Company in writing and orally, from time to time may
contain certain "forward-looking" information as this term is defined by: (1)
the Private Securities Litigation Reform Act of 1995 (the "Act") and (2) in
releases made by the Securities and Exchange Commission. These Cautionary
Statements are being made pursuant to the provisions of the Act and with the
intention of obtaining the benefits of the "safe harbor" provisions of the Act.
The Company cautions investors that any forward-looking statements made by the
Company involve risks and uncertainties, which could cause actual results to
differ materially from those projected.
The Company has identified certain risks and uncertainties as factors, which may
impact on its operating results that are detailed below. All of these factors
are difficult for the Company to forecast, and these or other factors can
materially adversely affect the Company's business and operating results for one
quarter or a series of quarters.
Limited Financial Resources. The Company has limited financial resources. It is
therefore subject to all the risks generally associated with a small business
having limited financial resources. For the three months ended November 30, 2001
and the years ended August 31, 2001, 2000 and 1999, the Company had net income
of approximately $61,000, $136,000, $355,000, and $555,000, respectively. There
can be no assurance that the Company will continue profitable operations.
Continued operations after the expenditure of the Company's existing cash
reserves may require additional working
-11-
capital to be generated by profitable operations or use of the bank lines of
credit and/or additional financing. There can be no assurance that profits will
continue or that additional external funding will be obtainable, if such a need
should arise.
Dependence on Key Employees. The business of the Company is dependent upon the
efforts of John Waldstein and certain other key management and technical
employees. The loss or prolonged disability of such personnel could have a
significant adverse effect on the business of the Company. The Company presently
maintains a key man life insurance policy of $1,000,000 on John Waldstein,
President and Chief Executive Officer and Treasurer.
Limited Design Engineering Staff. The Company is engaged in an industry, which,
as a result of extensive research and development, introduces new products on a
regular basis. Current competitors or new market entrants may develop new
products with features that could adversely affect the competitive position of
the Company's products. There can be no assurance that the Company will be
successful in selecting, developing, manufacturing and marketing new products or
enhancing its existing products or that the Company will be able to respond
effectively to technological changes or product announcements by competitors.
Any failure or delay in these goals could have a material adverse effect on the
Company.
Fluctuations in Sales and Operating Results. Operating results may also
fluctuate due to factors such as the timing of new product announcements and
introductions by the Company, its major customers and its competitors, market
acceptance of new or enhanced versions of the Company's products, changes in the
product mix of sales, changes in the relative proportions of sales among
distribution channels or among customers within each distribution channel,
changes in manufacturing costs, competitive pricing pressures, the gain or loss
of significant customers, increased research and development expenses associated
with new product introductions and general economic conditions. A limited number
of customers have accounted for a significant portion of sales in any particular
quarter. In addition, the Company typically operates with a relatively small
backlog. As a result, quarterly sales and operating results generally depend on
the volume, timing of, and ability to fulfill orders received within the quarter
which are difficult to forecast. In this regard, the Company may recognize a
substantial portion of its sales in a given quarter from sales booked and
shipped in the last weeks of that quarter. A delay in customer orders, resulting
in a shift of product shipment from one quarter to another, could have a
significant effect on the Company's operating results. In addition, competitive
pressure on pricing in a given quarter could adversely affect the Company's
operating results, or such price pressure over an extended period could
adversely affect the Company's long-term profitability.
The Company establishes its expenditure levels for sales and marketing and other
expenses based, in large part, on its expected future results. As a result, if
sales fall below expectations, there would likely be a material adverse effect
on operating results because only a small portion of the Company's expenses vary
with its sales in the short-term.
-12-
Concentration of Customers. The Company has a substantial number of customers
but sells a large majority of its products to a small number of large customers.
This concentration of customers may cause net sales and operating results to
fluctuate from quarter to quarter based on major customers' requirements and the
timing of their orders and shipments. Sales to the Company's two largest
customers accounted for approximately 46% of the Company's total net sales for
the fiscal year ended August 31, 2001. The Company's industry has recently
experienced significant consolidation, which may further increase the Company's
concentration among its major customers. There can be no assurance that the
Company's major customers will place additional orders, or that the Company will
obtain orders of similar magnitude from other customers. The Company's operating
results could be materially and adversely affected if any present or future
major customer were to choose to reduce its level of orders, were to experience
financial, operational or other difficulties that resulted in such a reduction
in orders to the Company or were to delay paying or fail to pay the Company's
receivables from such customer.
General Economic Conditions. The Company's business is subject to the effects of
general economic conditions in the United States and globally. If the economic
conditions in the United States and globally do not improve, or if there is a
worsening in the global economic slowdown, the Company could experience adverse
impacts on its business, operating results and financial condition.
Competition. Other companies in the industry offer products in competition with
those of the Company. Many of the companies with which the Company competes are
substantially larger, have greater resources and market a larger line of
products. The Company expects competition to increase significantly in the
future from existing competitors and new companies that may enter the Company's
existing or future markets. Increased competition could adversely affect the
Company's sales and profitability. There can be no assurance that the Company
will be able to continue to compete successfully with its existing competitors
or with new competitors.
Lack of Patent Protection. Although the Company has obtained some patent and
copyright protection for certain of its products and software, management
believes that competitors may be able to market certain products similar to
those sold by the Company.
Offshore Production. The Company is currently having some of its finished
products manufactured in Asia. The Company presently maintains certain
manufacturing molds in Asia and has a significant amount of components for some
products manufactured in Asia. There can be no assurance that the Asian
political or economic environment will remain sufficiently stable to allow
reliable and consistent delivery of product.
Dependence on Single Source of Supply. The Company is dependent upon sole source
suppliers for a number of key components and parts used in the Company's
products. There can be no assurance that these suppliers will be able to meet
the Company's future requirements for such components or that the components
will be available to the Company at favorable prices, or at all. Any extended
interruption in the supply or significant increase in price of any such
components could have a material adverse effect on the Company's operating
results in any given period.
-13-
Foreign Sales. During the year ended August 31, 2001, the Company's foreign
sales represented approximately 10% of net sales. There may be a reduction in
the Company's foreign sales from the 2001 level in the event of significant
changes in foreign exchange rates or political and economic instability in
foreign countries.
Limited Market for Common Stock. There is a limited market for the Company's
common stock and there can be no assurance that even this limited market will be
sustained. Holders of the Company's common stock may have difficulty selling
their shares or may have difficulty selling them at a favorable price.
Maintain Listing on NASDAQ. There can be no assurance that the Company will
continue to meet the NASDAQ SmallCap standards to maintain its listing on
NASDAQ. If the Company is unable to maintain its listing on NASDAQ, holders of
the Company's common stock may have difficulty selling their shares or may have
difficulty selling them at a favorable price.
Volatility of Stock Price. The Company's stock price is subject to significant
volatility. If revenues or earnings in any quarter fail to meet the investment
community's expectations, announcements of new products by the Company or its
competitors and other events or factors could have an immediate impact on the
Company's stock price. The stock price may also be affected by broader market
trends unrelated to the Company's performance.
-14-
Part II. Other Information
- ---------------------------
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) There were no reports on Form 8-K filed for
the three months ended November 30, 2001.
(b) Exhibits
None
SIGNATURE
---------
Pursuant to the requirements of the Exchange Act, the Registrant has duly caused
this report to be signed on its behalf by the undersigned, who is duly
authorized to sign and is the Chief Financial and Accounting Officer.
International Electronics, Inc.
Date: 1/11/02 /s/ John Waldstein
-------- -------------------------------------
John Waldstein, President and Chief Executive
Officer, Treasurer, Chief Financial and Accounting
Officer and Chairman of the Board and duly authorized to sign.
-15-