FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 For the quarterly period ended March 31, 1999
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ________ to ___________
Commission file number: 000-23677
NEWMARK HOMES CORP.
(Exact name of Registrant as specified in its charter)
Nevada 76-0460831
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1200 Soldiers Field Drive
Sugar Land, TX 77479
(Address of principal executive offices) (Zip code)
281-243-0100
(Registrant's telephone number including area code)
Not applicable
(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 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 ____
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes ____ No ____
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
Title Outstanding
Common Stock, par value $.01 11,500,000 shares as of May 4, 1999
NEWMARK HOMES CORP.
INDEX
Page
PART I. Financial Information 4
ITEM 1. Financial Statements 4
Condensed Consolidated Balance Sheet 4
Condensed Consolidated Statement of Operations 5
Condensed Consolidated Statement of Stockholders' Equity 6
Condensed Consolidated Statement of Cash Flows 7
Notes to the Condensed Consolidated Financial Statements 8
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 12
ITEM 3. Changes in Information About Market Risk - None. 15
PART II. Other Information 15
ITEM 1. Legal Proceedings - None. 15
ITEM 2. Changes in Securities - None. 15
ITEM 3. Defaults Upon Senior Securities - None 15
ITEM 4. Submission of Matters to a Vote of Security Holders - None. 15
ITEM 5. Other Information - None 15
ITEM 6. Exhibits and Reports on Form 8-K 15
Exhibits
Exhibit 27 - Financial Data Schedule 15
Reports on Form 8-K 15
Signatures 16
Part I. Financial Information
Item 1. Financial Statements
NEWMARK HOMES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
ASSETS December 31, March 31,
1998 1999
------------------- -------------------
(unaudited)
Cash................................................................. $ 5,794 $ 3,056
Receivables.......................................................... 6,967 8,345
Inventory............................................................ 185,247 210,505
Investment in unconsolidated subsidiaries ........................... 490 435
Other assets, net ................................................... 9,196 10,342
Goodwill, net of accumulated amortization of $5,173 and $5,530 in
1998 and 1999, respectively .................................... 37,644 37,287
------------------- --------------------
Total assets....................................... $ 245,338 $ 269,970
=================== ===================
LIABILITIES AND STOCKHOLDERS' EQUITY
Construction loans payable .......................................... $ 106,839 $ 133,631
Acquisition notes payable............................................ 12,341 9,873
Other payables to affiliates ........................................ 2,442 -
Accounts payable and accrued liabilities............................. 22,935 21,604
Other liabilities ................................................... 10,669 12,755
------------------ -------------------
Total liabilities.................................. 155,226 177,863
------------------- -------------------
Stockholders'equity:
Common stock -- $.01 par value; 30,000,000 shares authorized,
11,500,000 shares issued and outstanding ............... 115 115
Additional paid-in capital...................................... 73,768 73,768
Retained earnings............................................... 16,229 18,224
------------------ -------------------
Total stockholders'equity.......................... 90,112 92,107
------------------- ------------------
Total liabilities and stockholders'equity.......... $ 245,338 $ 269,970
=================== ===================
<FN>
See accompanying notes to the condensed consolidated financial statements.
</FN>
NEWMARK HOMES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share amounts)
(unaudited)
Three Months
Ended March 31,
-----------------------------------
1998 1999
------------- --------------
Revenues............................................................. $ 69,195 $ 92,832
Cost of sales ...................................................... 57,740 78,339
-------------- --------------
Gross profit......................................................... 11,455 14,493
Equity in earnings from unconsolidated subsidiaries ................ 108 123
Selling, general and administrative expenses......................... (8,137) (10,324)
Depreciation and amortization........................................ (725) (840)
-------------- --------------
Operating income ............................................... 2,701 3,452
Other income (expense):
Interest expense ............................................... (825) (403)
Other income, net .............................................. 165 114
-------------- --------------
Income before income taxes ................................ 2,041 3,163
Income taxes ........................................................ 765 1,168
-------------- ---------------
Net income ................................................ $ 1,276 1,995
============== ==============
Earnings per common share:
Basic........................................................... $.13 $.17
============== ==============
Diluted......................................................... $.13 $.17
============== ==============
Weighted average number of shares of common stock equivalents outstanding:
Basic........................................................... 9,622,222 11,500,000
============== ==============
Diluted......................................................... 9,622,222 11,500,000
============== ==============
<FN>
See accompanying notes to the condensed consolidated financial statements.
</FN>
NEWMARK HOMES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS'EQUITY
(In thousands)
(unaudited)
Additional
Common Paid-in Retained
Stock Capital Earnings Total
----------- -- ------------ -- ------------- --- --------------
Balance, December 31, 1997 .................. $ 92 $52,165 $ 3,434 $55,691
Initial public offering of common stock, net
of issuance of costs of $2,554,000,
March 13, 1998......................... 20 18,426 - 18,446
Capital contribution......................... - 302 - 302
Net income................................... - - 1,276 1,276
----------- ------------ ------------- --------------
Balance, March 31, 1998...................... $112 $70,893 $ 4,710 $75,715
=========== ============ ============= ==============
Balance, December 31, 1998 .................. $115 $73,768 $16,229 $90,112
Net income................................... - - 1,995 1,995
----------- ------------ ------------- --------------
Balance, March 31, 1999...................... $115 $73,768 $18,224 $92,107
=========== ============ ============= ==============
<FN>
See accompanying notes to the condensed consolidated financial statements.
</FN>
NEWMARK HOMES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
Three Months
Ended March 31,
--------------------------------------
1998 1999
------------------ ----------------
Cash flows from operating activities:
Net income....................................................... $ 1,276 $ 1,995
Adjustments to reconcile net income to net cash used in operating
activities:
Depreciation and amortization.................................. 725 840
Net (gain) loss on sale of property, premises and equipment.... 13 (24)
Equity in earnings from unconsolidated subsidiaries............ (108) (123)
Changes in operating assets and liabilities, net of effects
from purchase of Westbrooke Communities, Inc.:
Inventory and land held for development, net............... (19,711) (25,259)
Receivables................................................ (3,925) (1,378)
Other assets .............................................. 1,168 (1,093)
Payable to affiliates...................................... (866) (2,442)
Accounts payable and accrued liabilities................... (360) (1,331)
Other liabilities.......................................... 5,488 2,085
------------------ ----------------
Net cash used in operating activities .................... (16,300) (26,730)
------------------ ----------------
Cash flows from investing activities:
Purchases of property, premises and equipment ................... (321) (621)
Proceeds from sales of property, premises and equipment............. - 111
Increase in goodwill ............................................ (374) -
Cash acquired in purchase of Westbooke Communities, Inc........... 3,618 -
Investment in unconsolidated subsidiaries........................... - (50)
Distributions from unconsolidated subsidiaries .................. 227 228
------------------ ----------------
Net cash provided by (used in) investing activities ....... 3,150 (332)
------------------ ----------------
Cash flows from financing activities:
Net proceeds from initial public offering of common stock........ 18,446 -
Capital contributions received .................................. 302 -
Proceeds from advances on construction loans payable ............ 57,136 201,267
Principal payments on construction loans payable ................ (47,018) (174,475)
Principal payments on acquisition notes payable.................. (12,250) (2,468)
------------------ ----------------
Net cash provided by financing activities.................. 16,616 24,324
------------------ ----------------
Increase (decrease) in cash ........................................ 3,466 (2,738)
Cash, beginning of period .......................................... 746 5,794
------------------ ----------------
Cash, end of period ................................................ $ 4,212 $ 3,056
================== ================
Supplemental disclosures of cash flow information:
Cash paid for:
Interest ...................................................... $ 2,299 $ 3,572
================== ================
Income taxes .................................................. $ 1,733 $ 4,079
================== ================
<FN>
See accompanying notes to the condensed consolidated financial statements.
</FN>
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
Organization
Newmark Homes Corp. and subsidiaries (the Company) is a majority-owned
subsidiary of Pacific Realty Group, Inc. (PRG) and ultimately a subsidiary of
Pacific USA Holdings Corp. (PUSA). The Company was formed in December 1994 to
serve as a real estate holding company.
The Company's primary subsidiaries are as follows:
Subsidiary Nature of Business
Newmark Home Corporation (Newmark) ......... Single-family residential homebuilding in Texas,
Tennessee and North Carolina -formed in 1983.
Westbrooke Communities, Inc. (Westbrooke)... Single-family residential homebuilding in Florida
-formed in 1976.
The Adler Companies, Inc. (Adler) .......... Single-family residential homebuilding in Florida
-formed in 1990.
Pacific United Development Corporation
(PUDC)...................................... Residential lot development in Texas and Tennessee
-formed in 1993.
Basis of Presentation
The consolidated financial statements include the accounts of the Company and
its subsidiaries. The accounting and reporting policies of the Company conform
to generally accepted accounting principles and general practices within the
homebuilding industry. All significant intercompany balances and transactions
have been eliminated in the consolidated financial statements.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
Interim presentation
The accompanying condensed consolidated financial statements have been prepared
by the Company and are unaudited. Certain information and footnote disclosures
normally included in financial statements presented in accordance with generally
accepted accounting principles have been omitted from the accompanying
statements. The Company's management believes the disclosures made are adequate
to make the information presented not misleading. However, the financial
statements should be read in conjunction with the financial statements and notes
thereto included in the Company's December 31, 1998 Annual Report on Form 10-K.
Earnings per share
Basic earnings per share is computed by dividing earnings attributable to common
shareholders by the weighted average number of common shares outstanding for the
period. Diluted earnings per share reflects the potential dilution that could
occur if securities or other contracts to issue common stock were exercised or
converted into common stock or resulted in the issuance of common stock that
then shared in the earnings of the Company.
The following tables reconcile the computation of basic and diluted earnings per
share for the three months ended March 31, 1998 and 1999 respectively.
Three Months Ended March 31,
------------------------------------------
1998 1999
------------------- ------------------
Income available to common shareholders
(Numerator).......................................... $ 1,276,000 $ 1,995,000
Weighted average of shares outstanding
(Denominator)....................................... 9,622,222 11,500,000
Basic EPS ....................................... $.13 $.17
=================== ==================
Effective of dilutive securities - 1998 Tandem Stock
Option Plan.................................... - -
Diluted EPS..................................... $.13 $.17
=================== ==================
Note 2. Inventory
The inventory as of December 31, 1998 and March 31, 1999 consists of the
following:
Carrying Value
Number of Homes (In thousands)
-------------------------------------- -----------------------------------
December 31, March 31, December 31, March 31,
1998 1999 1998 1999
------------------ ---------------- ---------------- --------------
Completed ......................... 118 105 $ 23,224 $ 21,630
Under construction ................ 829 936 98,692 115,417
Models ............................ 74 80 15,401 17,323
Residential lots.................... - - 47,930 56,135
================== ================ ================ ==============
Total 1,021 1,121 $ 185,247 $ 210,505
================== ================ ================ ==============
Note 3. Capitalized Interest
A summary of interest capitalized in inventory is as follows (In thousands):
Three Months Ended March 31,
------------------------------------
1998 1999
----------------- ---------------
Interest capitalized, beginning of period ........................ $ 2,572 $ 5,516
Capitalized interest acquired in purchase of
Westbrooke Communities, Inc................................. 2,597 -
Interest incurred ................................................ 2,591 2,724
Less interest included in:
Cost of sales .............................................. 1,552 1,698
Other income (expense) ..................................... 825 403
================= ===============
Interest capitalized end of period ............................... $ 5,383 $ 6,139
================= ===============
Note 4. Commitments and Contingencies
The Company is subject to certain pending or threatened litigation and other
claims. Management, after review and consultation with legal counsel, believes
the Company has meritorious defenses to these matters and that any potential
liability from these matters would not materially affect the Company's
consolidated financial statements.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operation
This Quarterly Report on Form 10-Q may contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Actual results
could differ materially from those projected in the forward-looking statements
as a result of the risk factors set forth below.
Results of Operations
The following tables set forth certain operating and financial data for the
Company:
New Sales Contracts, Homes in
Net of Cancellations Home Closings Sales Backlog
------------------------ ----------------------- -------------------------
Three Months Three Months As of
Ended March 31, Ended March 31, March 31,
------------------------ ----------------------- -------------------------
1998 1999 1998 1999 1998 1999
---- ---- ---- ---- ---- ----
Houston.................. 164 191 73 121 186 245
Austin..................... 139 208 86 118 142 274
Dallas/Ft. Worth......... 40 68 34 35 46 90
Nashville.................. 6 26 - 15 6 33
Charlotte/
Greensboro............... - 1 - - - 1
Ft. Lauderdale/
Palm Beach/Miami...... 205 160 138 125 434 350
--- --- --- --- --- ---
Total...................... 554 654 331 414 814 993
=== === === === === ===
As a Percentage of Revenue
Three Months
Ended March 31,
-----------------------------------
1998 1999
---- ----
Cost of sales........................................ 83.4% 84.4%
Gross profit......................................... 16.6% 15.6%
Selling, general and administrative expenses......... 11.8% 11.1%
Income before income taxes........................... 2.9% 3.4%
Income taxes (1)..................................... 37.5% 36.9%
Net income........................................... 1.8% 2.1%
<FN>
(1) As a percent of income before income taxes.
</FN>
Three Months Ended March 31, 1999 Compared to Three Months Ended March 31, 1998.
Revenues for the three months ended March 31, 1999, increased by 34.2%, to $92.8
million, from $69.2 million for the comparable period of 1998. The number of
homes closed by the Company increased by 25% to 414 homes in the three months
ended March 31, 1999 from 331 homes in the same period of 1998.
The average selling price of homes closed in the three months ended March 31,
1999 was $224,232, an increase of 7.3% from the $209,048 average selling price
in the comparable period of 1998.
New net sales contracts increased 18.1%, to 654 homes for the three months ended
March 31, 1999, from 554 homes for the three months ended March 31, 1998. The
dollar amount of new net sales contracts increased 31.4%, to $152.8 million.
The Company was operating in 69 subdivisions at March 31, 1999, compared to 54
subdivisions at March 31, 1998. At March 31, 1999, the Company's backlog of
sales contracts was 993 homes, a 22% increase over comparable figures at March
31, 1998.
Cost of sales increased by 35.7%, to $78.3 million in the three months ended
March 31, 1999, from $57.7 million in the comparable period of 1997. The
increase was attributable to the increase in revenues. As a percentage of
revenues, cost of sales for the quarter increased to 84.4% in 1999 from 83.5% in
1998.
Selling, general and administrative (SG&A) expense increased by 26.9%, to $10.3
million in the three months ended March 31, 1999, from $8.1 million in the
comparable period of 1998. As a percentage of revenues, SG&A expense decreased
slightly to 11.1% in 1999, from 11.8% in 1998. This increase was caused by the
expansion into the new markets of Nashville, Tennessee and Charlotte and
Greensboro, North Carolina as well as the expansion in the Company's Texas
markets as indicated by a 22% increase in the Company's backlog at the end of
March 1999 versus March 1998.
Interest expense amounted to $403,000 in the three months ended March 31, 1999,
compared to $825,000 in the comparable period of 1998. The Company follows a
policy of capitalizing interest only on inventory under construction or
development. During the three months ended March 31, 1999 and 1998, the Company
expensed a portion of incurred interest and other financing costs on those
completed homes held in inventory. This expense decreased due to the decrease in
the average number of completed homes held in inventory for the quarter ending
March 31, 1999. Capitalized interest and other financing costs are included in
cost of sales at the time of home closings.
The Company's provision for income taxes decreased as a percentage of earnings
before taxes to 36.9% for the three months ended March 31, 1999, compared to
37.5% for the three months ended March 31, 1998. The decrease is attributable to
a state income tax benefit for Adler. Under a tax allocation agreement with
PUSA, the Company is required to calculate its federal corporate income tax
liability as if it filed a separate federal income tax return for each period
and to pay PUSA the sum which would result from such calculation if the Company
were subject to federal corporate income tax and filed a separate tax return.
The Company recognized federal income tax expense under the tax allocation
agreement amounting to $1,181,000 for the three months ended March 31, 1999
compared to $714,000 for the three months ended March 31, 1998.
Financial Condition, Liquidity and Capital Resources
At March 31, 1999, the Company had available cash and cash equivalents of $3.1
million. Inventories (including finished homes and construction in progress,
developed residential lots and other land) at March 31, 1999, increased by $25.3
million from $185.2 at December 31, 1998, due to a general increase in business
activity and the expansion of operations in the newer market areas. Because of
the increased business activity and expansion of operations in the newer
markets, the Company's ratio of construction loans payable to total capital
increased to 61.8% at March 31, 1999, from 56.0% at December 31, 1998. The
equity to total assets ratio decreased during the three months, to 34.1% at
March 31, 1999, from 36.7% at December 31, 1998.
The Company's financing needs depend upon the results of its operations, sales
volume, inventory levels, inventory turnover, and acquisitions. The Company has
financed its operations through borrowings from financial institutions and
through funds from earnings.
At March 31, 1999, the Company had unused lines of credit for construction loans
totaling approximately $228.4 million of which $19.3 million is available to
draw down.
The Company's growth requires significant amounts of cash. It is anticipated
that future home construction, lot and land purchases and acquisitions will be
funded through internally generated funds and new and existing borrowing
relationships. The Company continuously evaluates its capital structure and, in
the future, may seek to further increase secured debt and obtain additional
equity to fund ongoing operations as well as to pursue additional growth
opportunities.
Except for ordinary expenditures for the construction of homes and, to a limited
extent, the acquisition of land and lots for development and sale of homes, at
March 31, 1999, the Company had no material commitments for capital
expenditures.
Seasonality and Quarterly Results
The homebuilding industry is seasonal, as generally there are more sales in the
spring and summer months, resulting in more home closings in the fall. The
Company operates in the Southwestern and Southeastern markets of the United
States, where weather conditions are more suitable to a year-round construction
process than other areas. The Company also believes its geographic dispersion to
be somewhat counter-cyclical, with adverse economic conditions associated with
certain of its markets often being offset by more favorable economic conditions
in other areas. The seasonality of school terms has an impact on the Company
operations, but it is somewhat mitigated by the fact that many of the Company's
buyers at the higher end of the Company's price range, including Fedrick, Harris
custom homes, no longer have children in school. As a result of these factors,
among others, the Company generally experiences more sales in the spring and
summer months, and more closings in the summer and fall months. Likewise,
Westbrooke has experienced seasonality in its revenues, generally completing
more sales in the spring and summer months and more closings in the fourth
quarter.
The Company historically has experienced, and in the future expects to continue
to experience, variability in revenues on a quarterly basis. Factors expected to
contribute to the variability include, among others: (i) the timing of home
closings; (ii) the Company's ability to continue to acquire land and options on
acceptable terms; (iii) the timing of receipt of regulatory approvals for the
construction of homes; (iv) the condition of the real estate market and general
economic conditions; (v) the cyclical nature of the homebuilding industry; (vi)
prevailing interest rates and the availability of mortgage financing; (vii)
pricing policies of the Company's competitors; (viii) the timing of the opening
of new residential projects; (ix) weather; and (x) the cost and availability of
materials and labor. The Company's historical financial performance is not
necessarily a meaningful indicator of future results and the Company expects its
financial results to vary from project to project from quarter to quarter.
Year 2000 Readiness Disclosure
The company has assessed and is continuing to assess its operating systems,
computer software applications, computer equipment and other equipment with
embedded electronic circuits ("Programs") that it currently used to identify
whether they are year 2000 compliant and, if not, what steps are needed to bring
them into compliance. The Company expects that the majority of all Programs,
including computer information systems utilized in its homebuilding and
residential lot development operations, will be year 2000 compliant by the end
of the second quarter of calendar 1999. For those Programs that will not be
compliant by them, the Company is reviewing the potential impact on the Company
and the alternatives that are available to it if the Programs cannot be brought
into compliance by December 31, 1999. The Company believes that the required
changes to its Programs will be made on a timely basis without causing material
operational issues or having a material impact on its results of operations or
its financial position.
The Company believes that, should a reasonably likely worst case Year 2000
situation occur, the Company, because of the basic nature of its systems, many
of which can be executed manually, would not likely suffer material loss or
disruption in remedying the situation. The costs incurred and expected to be
incurred in the future regarding Year 2000 compliance have been and are expected
to be immaterial to the results of operation and financial position of the
Company. Costs related to Year 2000 compliance are expensed as incurred.
The Company has been reviewing whether its significant subcontractors,
suppliers, financial institutions and other service providers ("Providers") are
Year 2000 compliant. The Company is not aware of any Providers that do not
expect to be compliant; however, the Company has no means of ensuring that its
Providers will be Year 2000 ready. The inability of Providers to be Year 2000
ready in a timely fashion could have an adverse impact on the Company. The
Company plans to respond to any such contingency involving any of its Providers
by seeking to utilize alternative sources for such goods and services, where
practicable. In addition, widespread disruptions in the national or
international economy, including, for example, disruptions affecting financial
markets, commercial and investment banks, governmental agencies and utility
services, such as heat, lights, power and telephones, could also have an adverse
impact on the Company. The likelihood and effects of such disruptions are not
determinable at this time
Item 3. Changes in Information about Market Risk
No disclosure required.
Part II. Other Information
Item 1. Legal Proceedings
No disclosure required.
Item 2. Changes in Securities
No disclosure required.
Item 3. Defaults Upon Senior Securities
No disclosure required.
Item 4. Submission of Matters to a Vote of Security Holders
No disclosure required.
Item 5. Other Information
No disclosure required.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 27 - Financial Data Schedule.
(b) Reports on Form 8-K.
Report on Form 8-K dated as of January 4, 1999 pertaining to the
Registrant being advised that the holder of shares representing 80% of
the Registrant's outstanding common stock has pledged those shares in
support of a commercial loan.
Report on Form 8-K dated as of February 3, 1999 pertaining to the
dismissal of KPMG, LLP as the Registrant's certifying accountants and
has engaged BDO Seidman, LLP as the new certifying accountants.
Report on Form 8-KA dated as of February 10, 1999 disclosing letter
from KPMG, LLP regarding their termination as certifying accountants.
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.
NEWMARK HOMES CORP.
May 4, 1999 By: /s/ Terry C. White
----------------------------------------
Date Terry C. White, Senior Vice President,
Chief Financial Officer, Treasurer
and Secretary