SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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For Quarter Ended March 31, 1996 Commission File Number 1-8927
COPLEY PROPERTIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 04-2866555
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
399 Boylston Street, 13th Fl.
Boston, Massachusetts 02116
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(617) 578-1200
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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 Securities Exchange Act of
1934 during the preceding twelve 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
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Page 1 of 17 pages. See Exhibit Index on Page 16.
As of May 10, 1996, there were issued and outstanding 3,584,350 shares of
Common Stock, $1.00 par value, and one share of Class A Common Stock, $1.00 par
value.
COPLEY PROPERTIES, INC.
FORM 10-Q
FOR QUARTER ENDED MARCH 31, 1996
PART I
FINANCIAL INFORMATION
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Page(s)
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Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 12
-2-
COPLEY PROPERTIES, INC.
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Consolidated Balance Sheets
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March 31, 1996 December 31,1995
-------------- ----------------
(unaudited) (audited)
Assets
Real estate investments (Notes 3 and 4):
Property, net $ 95,020,392 $ 72,396,765
Investment in tenancies-in-common - 2,310,781
Notes receivable 880,000 895,963
------------ ------------
Total real estate investments 95,900,392 75,603,509
Cash and cash equivalents 5,236,859 5,716,300
Other assets 157,333 197,448
------------ ------------
Total assets $101,294,584 $ 81,517,257
============ ============
Liabilities and Shareholders' Equity
Liabilities:
Accounts payable and other liabilities $ 341,750 $ 544,045
Accrued management advisory fees (Note 8) 2,684,241 2,573,917
Mortgage notes payable (Note 6) 59,868,190 39,333,349
------------ ------------
Total liabilities 62,894,181 42,451,311
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Shareholders' Equity:
Common stock, $1.00 par value;
authorized 20,000,000 shares;
issued 4,007,500 shares 4,007,500 4,007,500
Additional paid-in capital 69,625,444 69,625,444
Treasury stock; 423,150 shares
of common stock, at cost (4,895,726) (4,895,726)
Cumulative deficit (30,336,816) (29,671,273)
Class A common stock (Note 8) 1 1
------------ ------------
Total shareholders' equity 38,400,403 39,065,946
------------ ------------
Total liabilities and
shareholders' equity $101,294,584 $ 81,517,257
============ ============
The accompanying notes are an integral part of these consolidated financial
statements.
-3-
COPLEY PROPERTIES, INC.
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Consolidated Statements of Operations and Cumulative Deficit (Unaudited)
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Quarter ended March 31,
1996 1995
---- ----
Investment Activity (Notes 3 and 5):
Property operations, net $ 644,717 $ 393,782
Share of real estate investment earnings 39,215 136,650
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Total real estate operations 683,932 530,432
Gain on exchange of ownership interests 30,397 -
------------ ------------
Total real estate activity 714,329 530,432
Interest on short-term investments
and cash equivalents 50,079 1,992
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Total investment activity 764,408 532,424
------------ ------------
Portfolio Expenses:
Management advisory fee (115,253) (149,237)
General and administrative (66,866) (65,112)
Professional fees (Note 10) (280,079) (33,671)
Interest expense - (94,778)
Write-off of deferred financing costs (Note 9) - (501,227)
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(462,198) (844,025)
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Net Income (Loss) 302,210 (311,601)
Common stock dividends (967,753) (896,070)
Cumulative Deficit:
Beginning of period (29,671,273) (28,261,241)
------------ ------------
End of year $(30,336,816) $(29,468,912)
============ ============
Per Share Data:
Net Income (Loss) $ .08 $ (.09)
============ ============
Dividends $ .27 $ .25
============ ============
The accompanying notes are an integral part of these consolidated financial
statements.
-4-
COPLEY PROPERTIES, INC.
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Consolidated Statements of Cash Flows (Unaudited)
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Quarter Ended March 31,
1996 1995
-------- --------
Cash flows from operating
activities:
Net income (loss) $ 302,210 $ (311,601)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Joint venture and tenancy-in-common operations (37,741) (132,228)
Cash distributions from joint ventures
and tenancies-in-common 301,628 96,812
Property depreciation and amortization 879,614 1,008,170
Gain on exchange of ownership interests (30,397) -
Write-off of deferred financing costs - 501,227
Increase in investment income receivable - (12,924)
Increase in deferred leasing commissions (284,656) (275,195)
(Increase) decrease in property working capital (82,402) 209,538
(Decrease) increase in accounts payable and
accrued management advisory fees (91,971) 42,196
Other, net 4,422 (10,125)
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Net cash provided by operating
activities 960,707 1,115,870
----------- -----------
Cash flows from investing activities:
Net cash payments in connection with
the exchange of ownership interests (87,878) -
Investment in Property (265,668) (830,829)
Deposit received on sale of property - 250,000
Decrease in notes receivable, net 14,652 28,003
----------- -----------
Net cash used in investing activities (338,894) (552,826)
----------- -----------
Cash flows from financing activities:
Increase in line of credit borrowings, net - 250,000
Proceeds from third-party mortgage note - 3,250,000
Principal payments on mortgage notes (133,501) (3,534,464)
Dividends paid (967,753) -
Financing costs - (130,184)
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Net cash used in financing activities (1,101,254) (164,648)
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Net increase (decrease) in cash and cash
equivalents (479,441) 398,396
Cash and cash equivalents:
Beginning of period 5,716,300 1,491,554
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End of period $ 5,236,859 $ 1,889,950
=========== ===========
Supplementary disclosure of cash flow information:
Cash paid for interest $ 1,335,484 $ 1,042,954
=========== ===========
As more fully described in Note 3, the Company consummated two exchange
transactions in February 1996, resulting in the conversion of the tenancies-in-
common balance of $2,040,359 and related notes receivable balance of $176,890 to
property of $22,705,585 and mortgage notes payable of $20,668,341 and notes
receivable of $180,000.
The accompanying notes are an integral part of these consolidated financial
statements.
-5-
COPLEY PROPERTIES, INC.
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Notes to Consolidated Financial Statements
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1 General
These financial statements have been prepared by Copley Properties, Inc. (the
"Company") without audit and reflect all normal and required adjustments which
are, in the opinion of management, necessary to fairly present the interim
results. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been omitted. It is suggested that these financial statements
be read in conjunction with the financial statements and notes thereto included
in the Company's audited financial statements for the year ended December 31,
1995.
2 Organization and Business
Copley Properties, Inc., a Delaware corporation, was incorporated in May 1985
and operates as a qualified real estate investment trust under applicable
provisions of the Internal Revenue Code of 1986, as amended. The Company
acquires, develops, operates and owns industrial real estate. The Company
currently owns and operates, either directly or through joint ventures, 11
properties totaling over 2.0 million square feet of net rentable area. Copley
Real Estate Advisors, Inc. (the Advisor) provides investment management and
administrative services to the Company. The Advisor is an indirect wholly owned
subsidiary of New England Investment Companies, L.P. (NEIC), a publicly traded
limited partnership. New England Mutual Life Insurance Company is the principal
unitholder of NEIC.
As described in Note 8, in February 1996, the Company entered into an
Agreement and Plan of Merger, under which the Company will be merged into
EastGroup Properties.
3 Real Estate Investments
The Company's real estate investments are either owned in their entirety or
through joint ventures in which the Company has a controlling interest. Several
properties were previously owned as tenancies-in-common. Wholly owned property
operations are under the oversight of local management companies. For jointly
owned property, the Company's venture partners are responsible for day-to-day
operating activities under separate property management agreements, and they are
entitled to fees for such services.
Effective February 1, 1996, the Company exchanged its co-tenant interest in
the 270 Technology Park property to obtain 100% ownership of the Columbia Place
property. In addition, the Company received $50,000 in cash and a secured
promissory note of $180,000 bearing interest at 9.56% per annum and maturing on
February 1, 2000, with annual interest and principal payments of $56,250. The
note is secured by a second deed of trust on the 270 Technology Park property.
The Company recognized a gain of $30,397 as a result of this transaction.
-6-
Effective February 2, 1996, the Company exchanged its co-tenant interests in
Carson Industrial Center, Central Distribution Center, West Side Business Park
and the three El Presidio buildings (comprising a portion of the Dominguez
Properties) to obtain 100% ownership of the Metro Business Park property and the
remaining building in Dominguez Properties. As part of the exchange, the
Company paid $138,000 in cash and forgave its note receivable of approximately
$177,000 from its co-tenant in Carson Industrial Center. No gain or loss was
recognized as a result of this transaction.
4 Real Estate Assets and Liabilities
The following is a summary of the assets and liabilities underlying the
Company's real estate investments. As of February 1996, the Company
relinquished its rights in some of the tenancies-in-common and obtained 100%
ownership of the others (See Note 3).
March 31,1996 December 31, 1995
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Property
Land $27,293,776 $ 21,655,181
Buildings and improvements 68,144,398 52,400,189
Accumulated depreciation (6,515,817) (5,752,574)
Deferred leasing costs and other
assets, net 2,117,864 1,162,722
Minority interest 1,516,589 1,509,970
----------- ------------
Total real estate assets 92,556,810 70,975,488
Accounts receivable 3,387,262 2,048,357
Accounts payable and other liabilities (923,680) (627,080)
----------- ------------
$95,020,392 $ 72,396,765
=========== ============
Mortgage notes payable to third-parties $59,868,190 $ 39,333,349
=========== ============
Investments in Tenancies-in-Common
Land $ - $ 8,246,048
Buildings and improvements - 33,965,653
Accumulated depreciation - (11,791,003)
Cash - 511,717
Other, net - 2,921,034
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Total assets - 33,853,449
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Mortgage notes payable to third-parties - 31,601,919
Other - 632,950
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Total liabilities - 32,234,869
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Net assets $ - $ 1,618,580
=========== ============
Company's share:
Loans to joint ventures $ - $ -
Capital - 2,310,781
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$ - $ 2,310,781
=========== ============
-7-
5 Results of Real Estate Investments
Operations
----------
The following is a summary of the operating results of the properties
underlying the Company's real estate investments:
Quarter ended March 31,
-----------------------
1996 1995
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Property
Rentals $ 3,485,171 $ 3,375,393
Operating expenses (668,218) (805,007)
Interest expense (1,259,241) (1,142,838)
Depreciation and amortization (879,614) (1,008,170)
Minority interest (33,381) (25,596)
----------- -----------
$ 644,717 $ 393,782
=========== ===========
Investments in Tenancies-in-Common (a)
Rentals $ 513,721 $ 1,572,188
Operating expenses (86,318) (257,485)
Interest expense (230,522) (703,674)
Depreciation and amortization (143,744) (458,187)
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$ 53,137 $ 152,842
=========== ===========
Company's share:
Interest on loans to joint ventures $ 1,474 $ 4,422
Equity in net income 37,741 132,288
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$ 39,215 $ 136,650
=========== ===========
(a) The 1996 results for properties owned as Tenancies-in-Common include only
the month of January (See Note 3), after which all of the Company's
remaining properties are owned in their entirety or through joint
ventures in which the Company has a controlling interest.
-8-
6 Mortgage Notes Payable
Mortgage notes payable on Properties are summarized below. They are
collateralized by real estate and, in certain cases, the assignment of rents.
The mortgage notes are generally non-recourse to the other assets of the
Company.
March 31, December 31,
1996 1995
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University Business Center
--------------------------
CIGNA; interest at 9.06%, payable monthly;
principal payments based on a 20-year
amortization schedule; remainder due
April 1, 2000 $ 9,307,945 $ 9,353,947
CIGNA; interest at 9.37%, payable monthly;
principal due January 1, 1997 10,000,000 10,000,000
Huntwood Associates
-------------------
Wells Fargo Bank; interest is a fixed rate
option with interest based on LIBOR plus 3.25%
and a variable rate option with interest based
on the prime rate plus 1% (the effective
interest rate was 9.5% at December 31, 1995);
principal due January 15, 1997 2,278,668 2,292,993
Massachusetts Mutual Life Insurance Company;
interest at 9.875%, payable monthly; principal
due June 1, 1996 10,000,000 10,000,000
Wiegman Associates
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Massachusetts Mutual Life Insurance Company;
interest at 9.875%, payable monthly; principal
due June 1, 1996 6,700,000 6,700,000
Allstate Insurance Company; interest at 8.75%,
payable monthly; principal due October 1, 1997 979,837 986,409
Columbia Place
--------------
American General Investment Corp.; interest
at 8.875%, payable monthly; principal due
December 31, 2009 (a) 10,211,212 -
Dominguez Properties
--------------------
Allstate Life Insurance Co.; interest at
9.00%, payable monthly; principal due
January 1, 1997 (a) 5,197,107 -
-9-
Metro Business Park
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State Farm Life Insurance Co.; interest at
9.25%, payable monthly; principal due
March 1, 1997 (a) 3,424,173 -
Allstate Life Insurance Co.; interest at
8.00%, payable monthly, principal due
April 1, 1998 (a) 1,769,248 -
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$58,868,190 $39,333,349
=========== ===========
(a) Balances for these mortgage notes payable were not separately
presented as of December 31, 1995 as these real estate investments
were owned as tenancies-in-common (See Note 3).
7 Line-of-Credit
The Company has an unsecured line-of-credit agreement with a bank which
expires on July 31, 1996. Under its terms, the Company could borrow up to
$5,000,000 at the prime rate of interest or LIBOR plus 1.5%. There was no
outstanding balance on the line-of-credit as of December 31, 1995 or March 31,
1996.
8 Merger Agreement
In February 1996, the Company entered into an Agreement and Plan of Merger
under which the Company will be merged into EastGroup Properties (EastGroup).
In the merger, each share of the Company's common stock will be converted into
EastGroup shares of beneficial interest with a value of $15.60, subject to the
limitations described below.
The value of EastGroup shares for purposes of calculating the ratio at which
the Company's shares will be converted into EastGroup shares in the merger will
be the average of the closing price of EastGroup shares on the New York Stock
Exchange on the 20 trading days immediately preceding the fifth trading day
prior to the effective date of the merger (the "EastGroup Stock Price");
however, the EastGroup Stock Price will be deemed to equal $20.25 if the
average price of EastGroup shares calculated above is less than or equal to
$20.25, and $23.00 if the average price of EastGroup shares is greater than or
equal to $23.00. The Company has the right, waivable by it, to terminate the
merger agreement without liability if the average closing price of EastGroup
shares on the New York Stock Exchange on the 20 trading days immediately
preceding the fifth trading day prior to (i) the date on which the Securities
and Exchange Commission declares EastGroup's Registration Statement with
respect to the merger effective or (ii) the date on which the Company's
stockholders' meeting with respect to the merger is held, is equal to or less
than $18.25.
The merger is subject to several conditions including approval by the
shareholders of both the Company and EastGroup and registration of the shares
to be issued in the merger with the Securities and Exchange Commission. Upon
the consummation of the merger, the Company has committed to pay Morgan Stanley
a transaction fee equal to $1.5 million, against which approximately $350,000
of other fees and expenses previously paid to Morgan Stanley will be credited.
The Advisor has agreed, upon the effectiveness of the merger, to the
termination of the Advisory Agreement and relinquishment of its right to, and
interest in, the Class A common share in consideration of payment by the
Company of 95% of the unpaid incentive advisory fees.
-10-
9 Deferred Financing Costs
In 1994, the Company commenced the marketing of additional equity on a private
placement basis and incurred $501,227 in Deferred Financing Costs in connection
with pursuing the private placement and arranging for an increased line of
credit, which was contingent on additional equity. Discussions with potential
investors did not produce an agreement on the terms of an equity investment and
the Company wrote off the Deferred Financing Costs in the first quarter of 1995.
10 Professional Fees
Certain professional fees are costs incurred by the Company related to its
consideration of various strategic alternatives aimed at maximizing shareholder
value and subsequent solicitation of proposals to acquire the Company.
Professional fees primarily consist of legal fees of approximately $227,500
related to this process and accounting fees of $52,500.
-11-
Copley Properties, Inc.
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Management's Discussion and Analysis of Financial Condition and Results of
Operations
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Liquidity and Capital Resources
The Company's assets consist primarily of investments in real estate. At
March 31, 1996, most of the properties are owned directly by the Company; two
properties are owned by joint ventures in which the Company is the managing
general partner. As a general partner in its joint venture investments, the
Company is obligated to fund its proportionate share of operating deficits.
At March 31, 1996, the Company had cash and cash equivalents totaling
$5,236,859. The Company also has a $5,000,000 bank line-of-credit which expires
on July 31, 1996. There was no outstanding balance on the line-of-credit as of
March 31, 1996.
Dividends will continue to be paid from cash generated by operations. As more
fully discussed under "Results of Operations" below, cash flow from operations
was $960,707 for the first quarter of 1996 compared to $1,115,870 for the first
quarter of 1995. The Company intends to distribute to its shareholders at least
95% of taxable income so as to maintain its qualification as a real estate
investment trust under the Internal Revenue Code of 1986, as amended. The
Company's policy is to pay dividends based on cash flow from operations, which
usually exceeds taxable income.
The Company is negotiating to extend the maturity of the mortgage notes
payable to Massachusetts Mutual Life Insurance Company, which are secured by the
Huntwood Associates and Wiegman Associates properties, from June 1, 1996 to June
30, 1996 on the same terms and conditions as the original financings.
During the second quarter of 1995, the Company retained Morgan Stanley &
Co. Incorporated (Morgan Stanley) as its financial advisor to assess the
strategic alternatives available to the Company in order to maximize shareholder
value. In September 1995, Morgan Stanley recommended that the Company solicit
the interest of third parties in merging with the Company or acquiring its stock
or assets. Morgan Stanley also assisted the Company in the solicitation of
interest of third parties. As discussed further in Note 8 to the accompanying
financial statements, in February 1996, the Company entered into an Agreement
and Plan of Merger under which the Company will be merged into EastGroup
Properties. In the merger, each share of the Company's common stock will be
converted into EastGroup shares of beneficial interest with a value of $15.60,
subject to certain limitations. The merger is subject to several conditions
including approval by the shareholders of both the Company and EastGroup and
registration of the shares to be issued with the Securities and Exchange
Commission.
-12-
Results of Operations
Restructurings
In August 1995, the Company entered into agreements with certain of its co-
venture partners to restructure the ownership of the joint venture investments
as tenancies-in-common. Effective February 1, 1996, the Company exchanged its
co-tenant interest in the 270 Technology Park property in exchange for 100%
ownership of the Columbia Place property. In addition, the Company received
$50,000 in cash and a secured promissory note of $180,000 bearing interest at
9.56% and maturing on February 1, 2000, with annual interest and principal
payments of $56,250. As a result of this transaction, the Company recognized a
gain of $30,397. Effective February 2, 1996, the Company exchanged its co-
tenant interests in Carson Industrial Center, Central Distribution Center, West
Side Business Park and the three El Presidio buildings (comprising a portion of
the Dominguez Properties) to obtain 100% ownership of the Metro Business Park
properties and the remaining building in Dominguez Properties. As part of the
exchange, the Company paid $138,000 in cash and forgave its note receivable from
its co-tenant in the Carson Industrial Center property of approximately
$177,000. No gain or loss was recognized as a result of this transaction.
Investment Performance
The overall leased percentage for the portfolio was 99% at March 31, 1996,
up from 98% a year earlier. Leases for 21% of the Company's square footage are
scheduled to expire during the remainder of 1996. Management expects that
occupancy will not be significantly affected by the upcoming expirations, as the
demand for industrial space strengthens with the recovering economy; however,
there can be no guarantee that the space will be leased or will be leased on
favorable terms. In January 1996, the Company executed a lease agreement at Los
Angeles Corporate Center which increased the percentage leased to 99%.
1996 Results of Operations Compared to 1995
Real estate operating results were $714,329 for the first quarter of 1996
compared to $530,432 for the first quarter of 1995. The improvement is due
primarily to the following factors: 1) income from Kingsview Industrial Center
which was purchased in July 1995, 2) a provision for bad debts recorded at
Dominguez Properties in the first quarter of 1995, and 3) higher income at
certain properties due to renewed leases and increased occupancy of the
Company's properties. These improvements were partially offset by a reduction
of rent at Los Angeles Corporate Center due to vacancy of approximately half of
the building in February 1995 (although this space has been released the lease
payments do not begin until May 1996) and the loss of income after the sale of
Park North Business Center and Peachtree Corners Distribution Center in June and
November 1995, respectively.
-13-
Cash flow from operations was $960,707 for the first quarter of 1996 compared
to $1,115,870 for the first quarter of 1995. The decrease is due primarily to
professional fees in 1996 associated with the strategic alternative assessment
and the pending merger, as well as an increase in property working capital.
These decreases were partially offset by the realization of cash flow upon
conversion of Dominguez Properties, Metro Business Park and Columbia Place from
tenancies-in-common accounted for under the equity method to wholly-owned
properties accounted for on a consolidated basis.
Portfolio Expenses
Management advisory fees for the first quarter of 1996 decreased by 23%
compared to the first quarter of 1995. The change in management fee expense is
consistent with the change in cash flow from operations, after reduction for the
amortization of long-term debt which is an adjustment to cash flow from
operations in the calculation of the management fee.
Professional fees for the first quarter of 1996 increased by approximately
$246,000 compared to the first quarter of 1995 as a result of costs incurred by
the Company related to its pending merger with EastGroup Properties. Included
in professional fees for the period ended March 31, 1996 is approximately
$227,500 of legal fees related to this process and $52,500 of accounting fees.
Interest expense for the quarter ended March 31, 1996 and 1995 was $0 and
$94,778, respectively. The Company had no borrowings under its line-of-credit
during the quarter ended March 31, 1996.
In late 1994, the Company commenced the marketing of additional equity on a
private placement basis and incurred $501,227 in Deferred Financing Costs in
connection with pursuing the private placement and arranging for an increased
line-of-credit, which was contingent on additional equity. Discussions with
potential investors did not produce an agreement on the terms of an equity
investment and the Company wrote-off the Deferred Financing Costs in the quarter
ended March 31, 1995.
Inflation
By their nature, real estate investments tend not to be adversely affected by
inflation. Inflation may cause appreciation in the value of the Company's real
estate investments over time if rental rates and replacement costs of properties
increase. Declines in property values, over the past several years, due to
market and economic conditions, have overshadowed the positive effect inflation
may have on the value of the Company's investments.
-14-
COPLEY PROPERTIES, INC.
FORM 10-Q
FOR QUARTER ENDED MARCH 31, 1996
PART II
OTHER INFORMATION
-----------------
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits: See Exhibit Index on page 16.
--------
b. Reports on Form 8-K: On February 16, 1996, the Company filed one
-------------------
current report on Form 8-K dated February 16, 1996, reporting item
No. 5 "Other Events," in which the Company reported that on
February 12, 1996 it had entered into a merger agreement with
EastGroup Properties.
Reports on Form 8-K: On March 5, 1996, the Company filed one
--------------------
current report on Form 8-K dated February 29, 1996, reporting item
No. 5 "Other Events," in which the Company reported that on
February 29, 1996 Steven E. Wheeler resigned as President, Chief
Executive Officer and a director of Copley Properties, Inc. (the
"Registrant"). Joseph W. O'Connor was elected to the offices of
President and Chief Executive Officer of the Registrant.
Reports on Form 8-K: On March 12, 1996, the Company filed one
-------------------
current report on Form 8-K dated March 7, 1996, reporting item No.
5 "Other Events," in which the Company reported that on March 7,
1996 it had been notified by its joint venture partner in UBC that
the joint venture partner has elected not to exercise its option
to purchase the Company's interest in UBC.
-15-
EXHIBIT INDEX
-------------
Exhibit Number Exhibit Page Number
- -------------- ------- -----------
27 Financial Data Schedule 18
-16-
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.
COPLEY PROPERTIES, INC.
(Registrant)
May 15, 1996 /s/ Peter P. Twining
-----------------------
Peter P. Twining
Vice President and Secretary
May 15, 1996 /s/ Daniel C. Mackowiak
-------------------------
Daniel C. Mackowiak
Treasurer and Principal Financial
and Chief Accounting Officer
-17-