SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended MARCH 31, 2002
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 0 -19703
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FARREL CORPORATION
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(Exact name of registrant as specified in its charter)
DELAWARE 22-2689245
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
25 MAIN STREET, ANSONIA, CONNECTICUT, 06401
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(Address of principal executive offices) (Zip Code)
(203) 736-5500
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(Registrant's telephone number, including area code)
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 CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
CLASS OUTSTANDING AT MAY 1, 2002
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Common Stock (Voting), $.01 par value 5,228,461
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FARREL CORPORATION
INDEX
PAGE
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets -
March 31, 2002 and December 31, 2001 3
Consolidated Statements of Operations -
Three months ended March 31, 2002
and April 1, 2001 4
Consolidated Statements of Cash Flows -
Three months ended March 31, 2002
and April 1, 2001 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
Part II. OTHER INFORMATION 12
Exhibit 11 - Computation of Earnings Per Share 14
Page 2 of 15
Part I - Financial Information
FARREL CORPORATION
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
March 31, December 31,
--------- ------------
2002 2001
---- ----
ASSETS
(Unaudited)
Current Assets:
Cash and cash equivalents $6,692 $5,579
Accounts receivable, net of allowance for
doubtful accounts of $92 and $179, respectively 5,718 9,416
Inventory 11,161 10,554
Deferred income taxes 423 423
Other current assets 1,124 873
--------------- ---------------
Total current assets 25,118 26,845
Property, plant and equipment - net of accumulated
depreciation of $15,230 and $14,995, respectively 7,669 8,101
Deferred income taxes 764 764
Other assets 286 256
--------------- ---------------
Total Assets $33,837 $35,966
=============== ===============
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $3,217 $4,393
Accrued expenses & taxes payable 1,021 1,482
Advances from customers 4,019 3,452
Accrued warranty costs 956 1,004
Current portion of long - term debt 666 680
--------------- ---------------
Total current liabilities 9,879 11,011
Long - term debt 831 1,019
Postretirement benefit obligation 1,067 1,076
Minimum pension liability 3,231 3,155
Commitments and contingencies --- ---
--------------- ---------------
Total Liabilities 15,008 16,261
--------------- ---------------
Stockholders' Equity:
Preferred stock, par value $100, 1,000,000
shares authorized, no shares issued --- ---
Common stock, par value $.01,
10,000,000 shares authorized,
6,142,106 shares issued 61 61
Paid in capital 19,295 19,295
Treasury stock, 913,645 shares at
March 31, 2002 and December 31, 2001 (2,530) (2,530)
Retained earnings 8,360 9,120
Accumulated other comprehensive loss (6,357) (6,241)
--------------- ---------------
Total Stockholders' Equity 18,829 19,705
--------------- ---------------
Total Liabilities and Stockholders' Equity $33,837 $35,966
=============== ===============
See Accompanying Notes to Consolidated Financial Statements
Page 3 of 15
FARREL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED
------------------
March 31, April 1,
2002 2001
---- ----
(unaudited) (unaudited)
Net sales $7,845 $11,080
Cost of sales 5,993 8,608
---------------- ----------------
Gross margin 1,852 2,472
Operating expenses:
Selling 968 1,302
General & administrative 1,892 1,711
Research & development 249 444
---------------- ----------------
Total operating expenses 3,109 3,457
---------------- ----------------
Operating loss (1,257) (985)
Interest income 26 52
Interest expense (27) (42)
Other income (expense), net 172 19
---------------- ----------------
Loss before income taxes (1,086) (956)
Benefit for income taxes 326 349
---------------- ----------------
Net loss $(760) $(607)
================ ================
Per share data:
Basic and Diluted net loss
per common share $(0.15) $(0.12)
================ ================
Average shares outstanding:
Basic 5,230,061 5,230,061
================ ================
Diluted 5,230,061 5,230,061
================ ================
Dividends declared $0.00 $0.00
================ ================
See Accompanying Notes to Consolidated Financial Statements
Page 4 of 15
FARREL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
THREE MONTHS ENDED
------------------
MARCH 31, APRIL 1,
--------- --------
2002 2001
---- ----
(Unaudited) (Unaudited)
Cash flows from operating activities:
Net loss $(760) $(607)
Adjustments to reconcile net loss to
net cash provided by (used in) operating activities:
Loss (gain) on disposal of fixed assets --- (151)
Depreciation and amortization 398 430
Decrease in accounts receivable 3,618 4,694
(Increase) in inventory (710) (2,122)
(Increase) in prepaid pension costs 67 (105)
Increase (decrease) in accounts payable (1,107) (537)
Increase (decrease) increase in customer advances 596 (16)
(Decrease) in accrued expenses & taxes (472) (508)
(Decrease) in accrued warranty costs (42) (45)
Increase (decrease) in deferred income taxes --- (108)
Other (265) (55)
----------------- ---------------
Total adjustments 2,083 1,477
----------------- ---------------
Net cash (used in) provided by operating activities 1,323 870
----------------- ---------------
Cash flows from investing activities:
Proceeds from disposal of fixed assets --- 374
Purchases of property, plant and equipment (14) (87)
----------------- ---------------
Net cash (used in) provided by investing activities (14) 287
----------------- ---------------
Cash flows from financing activities:
Repayment of long-term borrowings (167) (289)
Proceeds from borrowing, net of repayments of short-term borrowings --- ---
Purchase of treasury stock --- ---
----------------- ---------------
Net cash (used in) financing activities (167) (289)
----------------- ---------------
Effect of foreign currency exchange rate changes on cash (29) (64)
----------------- ---------------
Net increase (decrease) in cash and cash equivalents 1,113 804
Cash and cash equivalents - Beginning of period 5,579 2,486
----------------- ---------------
Cash and cash equivalents - End of period $6,692 $3,290
================= ===============
Income taxes paid $27 $17
================= ===============
Interest paid $27 $42
================= ===============
See Accompanying Notes to Consolidated Financial Statements
Page 5 of 15
FARREL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - BASIS OF PRESENTATION
In the opinion of management, the accompanying unaudited consolidated
financial statements have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of regulation S-X. Accordingly, they do
not include all of the information and footnotes required by U. S. generally
accepted accounting principles for complete financial statements. In the opinion
of management, the accompanying unaudited consolidated financial statements
contain all adjustments, consisting only of normal recurring adjustments,
necessary to present fairly in accordance with generally accepted accounting
principles, the consolidated financial position of Farrel Corporation ("Farrel"
or "the Company") as of March 31, 2002, and the consolidated results of its
operations and its cash flows for the three month periods ended March 31, 2002
and April 1, 2001. These results are not necessarily indicative of results to be
expected for the full fiscal year. The statements should be read in conjunction
with the financial statements and notes thereto, included in the Company's
Annual Report and Form 10-K for the year ended December 31, 2001.
NOTE 2 - INVENTORY
Inventory is comprised of the following:
MARCH 31, DECEMBER 31,
--------- ------------
2002 2001
---- ----
(In thousands)
Stock and raw materials..................... $6,906 $6,444
Work-in process............................. 4,255 4,110
----- -----
Total....................................... $11,161 $10,554
======= =======
NOTE 3 - COMPREHENSIVE INCOME (LOSS)
Other comprehensive income (loss) is as follows:
Three Months Ended
March 31, April 1,
2002 2001
---- ----
(In thousands)
Net loss $(760) $(607)
Foreign currency translation
adjustments (203) (487)
----- -----
Other comprehensive income
(loss) $(963) $(1,094)
====== ========
Accumulated other comprehensive income (loss) consists of the
following:
March 31, December 31,
2002 2001
---- ----
(In thousands)
Foreign currency translation
adjustments $(1,623) $(1,420)
Minimum pension liability (4,734) (4,821)
------- ---------
Accumulated other comprehensive
income (loss) $(6,357) $(6,241)
======== =======
Page 6 of 15
NOTE 4 - SEGMENT INFORMATION
The Company's operations are considered one operating segment. The
Company's products consist of new machines, aftermarket and spare parts and
repair related services. The Company's products and services are sold to
commercial manufacturers in the plastic and rubber industries. The
manufacturing, assembly and distribution of each of the Company's products are
essentially the same.
NOTE 5 - IMPACT OF RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
In June 2001, the Financial Accounting Standards Board (the "FASB") issued
statements No. 142 (Goodwill and Other Intangible Assets) and No. 143
(Accounting for Asset Retirement Obligations). Statement No. 142 was adopted by
the Company on January 1, 2002. The Company must adopt statement No. 143 no
later than January 2003. Statement No. 142 changed the accounting for Goodwill
and other intangible assets, such that those assets whose life is determined to
be indefinite are not subject to amortization. These assets shall be tested for
impairment at least annually, and the value will need to be written down if the
fair value is less than the carrying value. The adoption of Statement No. 142
did not have a significant effect on the Company's financial position or results
of operations. Statement No. 143 requires that a liability must be recognized
for an asset retirement obligation related to long lived tangible assets. The
liability shall be recorded at fair value. The Company anticipates the adoption
of Statement No. 143 will not have a significant effect on its financial
position or results of operations.
In August 2001, the FASB issued statement No. 144 (Accounting for the
Impairment or Disposals of Long-lived Assets). The Company adopted statement No.
144 on January 1, 2002. This statement requires an impairment loss to be
recognized if the carrying value of a long-lived asset (asset group) is not
recoverable and exceeds its fair value. Long-lived assets (asset groups) shall
be tested for impairment whenever events or changes in circumstances indicate
that its carrying amount may not be recoverable. The adoption of this statement
did not have an effect on the Company's financial position or results of
operations.
NOTE 6 - FOREIGN CURRENCY CONTRACTS
In June 1998, the FASB issued Statement No. 133, Accounting for Derivative
Instruments and Hedging Activities, which the Company adopted on January 1,
2001. The Statement provides a new method of accounting for derivatives and
hedges. The adoption of this Statement did not have a significant effect on the
Company's results of operations or financial position.
The Company has entered into foreign exchange forward contracts which are
designated as fair value hedges of accounts receivable and future receivables
related to customer orders in backlog. The Company, from time to time, enters
into foreign exchange forward contracts to hedge certain firm commitments that
are denominated in currencies other than the Company's operating currencies.
As of March 31, 2002, all of the Company's foreign exchange forward
contracts were designated as fair value hedges. As such, there were no charges
to the statement of operations during the three months ended March 31, 2002,
related to these contracts. At March 31, 2002, the difference between the spot
rate and the contract rate for the foreign exchange forwards was a net
unrealized loss of $1,100.
NOTE 7 - BANK CREDIT ARRANGEMENTS
In June 2001, the Company entered into a new worldwide multi-currency
credit facility with a major US bank. This facility includes a $10 million
revolving credit facility for direct borrowings and letters of credit. The
facility contains a sub-limit that caps the amount of direct borrowings the
Company can make at $5 million. The revolving credit facility expires on June
15, 2003. The facility contains limits on direct borrowings and issuance of
letters of credit based upon stipulated percentages of accounts receivable and
inventory. The facility, as amended, also contains covenants specifying minimum
and/or maximum
Page 7 of 15
thresholds for operating results, selected financial ratios and backlog. The
backlog covenant requires that end of month backlog will not be less than $20
million for more than two consecutive months. The Company did not achieve the
backlog covenant as of the end of January and February 2002; however, the bank
waived the non-compliance. The agreement contains certain restrictions on
investments, borrowings and the sale of assets. Dividend declarations or
payments are allowed under this credit facility as long as there exists under
the credit facility no Event of Default (as defined in the credit facility) or
no condition which upon giving notice or lapse of time or both, would become an
Event of Default. The Company's old credit facility was terminated except in
relation to approximately $33,000 of letters of credit that had previously been
posted under that facility and continue to be outstanding on March 31, 2002. The
Company has approximately $1.3 million of letters of credit posted under its new
facility on March 31, 2002.
In June 2001, the Company also entered into a term loan for
(pound)1.4 million (approximately $2 million) as part of this credit facility.
The proceeds of this loan were used to repay an existing term loan of the same
amount. The new term loan is repayable in monthly installments of (pound)38,888
(approximately $55,500) through June 2004. The term loan has an interest rate of
LIBOR plus 2.7%.
Page 8 of 15
PART I - ITEM 2 -
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION & RESULTS OF OPERATIONS
SAFE HARBOR STATEMENTS UNDER PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Certain statements contained in the Company's public documents, including
this report and in particular, this "Management's Discussion and Analysis of
Financial Condition and Results of Operations", may be forward looking and may
be subject to a variety of risks and uncertainties. Various factors could cause
actual results to differ materially from these statements. These factors
include, but are not limited to, pricing pressures from competitors and/or
customers; continued economic and political uncertainty in certain of the
Company's markets; the Company's ability to maintain and increase gross margin
levels; the Company's ability to generate positive cash flow; changes in
business conditions, in general, and, in particular, in the businesses of the
Company's customers and competitors; the Company's access to adequate financing
at competitive rates and other factors which might be described from time to
time in the Company's filings with the Securities and Exchange Commission.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2002 COMPARED TO THE THREE MONTHS ENDED APRIL 1,
2001
Net sales for the three month period ended March 31, 2002, were $7.8
million compared to $11.1 million for the three month period ended April 1,
2001, a decrease of $3.3 million. The decrease is primarily a result of lower
new machine sales. The timing of the Company's sales, particularly new machines
sales, is highly dependent on when an order is received, the amount of lead time
from receipt of order to delivery and specific customer requirements. The
Company operates in markets that are extremely competitive with cyclical demand.
Many of the Company's customers and markets operate at less than full capacity
and certain remain particularly competitive and are subject to local economic
events.
Orders received for the three month period ended March 31, 2002, were
$14.1 million compared to $9.6 million for the three month period ended April 1,
2001. The increase in incoming orders is due to higher new machine orders
received in North America.
The Company's products are primarily supplied to manufacturers and
represent capital commitments for new plants, expansion or modernization. In the
case of major equipment orders, up to 12 months are required to complete the
manufacturing process. Accordingly, revenues reported in the statement of
operations may represent orders received in the current or previous periods
during which time economic conditions in various geographic markets of the world
impact the Company's level of order intake. Many of the Company's traditional
customers and markets are operating with excess capacity thereby reducing the
number of projects for plant expansion and modernization. The Company is
experiencing increased pricing pressures from competitors in an overall smaller
market. In addition, since its inception, the decline in the value of the Euro
versus the U.S. dollar and British pound sterling has increased pricing
pressures. The Euro's weakness provides substantial advantages to our
competitors in the Euro-zone. Over the longer term, these conditions are
resulting in customer orders with lower margins and lost business. Further, the
cyclical nature of industry demand and, therefore, the timing of order intake
may effect the Company's quarterly results of operations. The Company's ability
to maintain and increase net sales depends upon a strengthening and stability in
the Company's traditional markets and its ability to control costs to
effectively compete in its current markets. There can be no assurance that the
current level of orders will continue, that market conditions will not worsen,
or that improvements in the Company's traditional markets will lead to increased
orders for the Company's products.
The level of backlog considered firm by management at March 31, 2002, was
$24.3 million compared to $18.1 million at December 31, 2001, and $26.2 million
at April 1, 2001. Substantially all the backlog as of March 31, 2002, is
scheduled to be shipped by December 31, 2002. Such shipments are subject to
various factors, such as customer requests for changes or manufacturing delays,
which could result in shipments being delayed beyond December 31, 2002.
Page 9 of 15
Gross margin for the three month period ended March 31, 2002, was $1.9
million compared to $2.5 million for the three month period ended April 1, 2001,
a decrease of $0.6 million. The decrease in gross margin is a result of lower
sales. The gross margin as a percent of sales for the three month period ended
March 31, 2002, was 23.6% compared to 22.3% for the three month period ended
April 1, 2001. The increase in gross margin as a percent of sales is primarily
due to a change in sales mix.
Operating expenses for the three month period ended March 31, 2002, were
$3.1 million compared to $3.5 million for the three month period ended April 1,
2001, a decrease of $0.3 million. The decrease is primarily due to lower
employee compensation and related expenses.
Interest income for the three month period ended March 31, 2002, was
$26,000 compared to $52,000 for the three month period ended April 1, 2001. The
decrease is due to lower interest rates.
Interest expense for the three month period ended March 31, 2002, was
$27,000 compared to $42,000 for the three months ended April 1, 2001. The
decrease is primarily due to lower borrowings and lower interest rates.
Other income, net for the three month period ended March 31, 2002, was
$172,000 compared to $19,000 for the three month period ended April 1, 2001.
Other income for the period ended March 31, 2002 includes approximately $167,000
received by the Company as a result of the demutualization of an insurance
provider used by the Company.
The Company provides for income taxes at the statutory rates in effect in
each tax jurisdiction in which income is earned or losses are generated,
adjusted for permanent differences in determining income for financial reporting
and income tax purposes. The effective income tax benefit rate was 30.0% for the
three month period ended March 31, 2002, compared to 36.5% for the three month
period ended April 1, 2001. The effective tax rate varies among periods due to
the change in the proportion and amount of income and losses generated in
different tax jurisdictions.
MATERIAL CONTINGENCIES
Pursuant to a settlement agreement entered in 1995 between the Company and
Black & Decker Corporation ("Black & Decker"), Black & Decker agreed to assume
full responsibility for the investigation and remediation of any pre-May 12,
1986 environmental contamination at the Company's Ansonia and former Derby,
Connecticut facilities, as required by the Connecticut Department of
Environmental Protection ("DEP"). Black & Decker has conducted a preliminary
environmental assessment of the facilities. Although the assessment is still
being evaluated by the DEP, on the basis of the preliminary data now available
there is no reason to believe that any activities which might be required as a
result of the findings of the assessment will have a material effect upon the
capital expenditures, results of operations or the competitive position of the
Company.
LIQUIDITY AND CAPITAL RESOURCES; CAPITAL EXPENDITURES
Working capital and the working capital ratio at March 31, 2002 were $15.2
million and 2.5 to 1, respectively, compared to $15.8 million and 2.4 to 1 at
December 31, 2001, respectively. During the three months ended March 31, 2002,
the Company paid no dividends.
Due to the nature of the Company's business, many sales are of a large
dollar amount. Consequently, the timing of recording such sales may cause the
balances in accounts receivable and/or inventory to fluctuate dramatically
between quarters and may result in significant fluctuations in cash provided by
operations. Historically, the Company has not experienced significant problems
regarding the collection of accounts receivable. The Company also generally has
financed its operations with cash generated by operations, progress payments
from customers and borrowings under its bank credit facilities. Management
anticipates that its cash balances, operating cash flows and available credit
line will be adequate to fund anticipated capital commitments and working
capital requirements for at least the next twelve months. The Company made
capital expenditures of $14,000 and $87,000 during the three month periods ended
March 31, 2002 and April 1, 2001, respectively.
Page 10 of 15
In June 2001, the Company entered into a new worldwide multi-currency
credit facility with a major US bank. This facility includes a $10 million
revolving credit facility for direct borrowings and letters of credit. The
facility contains a sub-limit that caps the amount of direct borrowings the
Company can make at $5 million. The revolving credit facility expires on June
15, 2003. The facility contains limits on direct borrowings and issuance's of
letters of credit based upon stipulated percentages of accounts receivable and
inventory. The facility, as amended, also contains covenants specifying minimum
and/or maximum thresholds for operating results, selected financial ratios and
backlog. The backlog covenant requires that end of month backlog will not be
less than $20 million for more than two consecutive months. The Company did not
achieve the backlog covenant as of the end of January and February 2002;
however, the bank waived the non-compliance. The agreement contains certain
restrictions on investments, borrowings and the sale of assets. Dividend
declarations or payments are allowed under this credit facility as long as there
exists under the credit facility no Event of Default (as defined in the credit
facility) or no condition which, upon giving of notice or lapse of time or both,
would become an Event of Default. The Company's old credit facility was
terminated except in relation to approximately $33,000 of letters of credit that
had previously been posted under that facility and continue to be outstanding on
March 31, 2002. The Company has approximately $1.3 million of letters of credit
posted under its new facility on March 31, 2002.
In June 2001, the Company also entered into a term loan for (pound)1.4 million
(approximately $2 million) as part of this credit facility. The proceeds of this
loan were used to repay an existing term loan of the same amount. The new term
loan is repayable in monthly installments of (pound)38,888 (approximately
$55,500) through October 2004. The term loan has an interest rate of LIBOR plus
2.7%. At March 31, 2002 and December 31, 2001, there were $1.5 million and $1.7
million, respectively, outstanding under a term loan.
IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS
In June 2001, the Financial Accounting Standards Board (the "FASB") issued
statements No. 142 (Goodwill and Other Intangible Assets) and No. 143
(Accounting for Asset Retirement Obligations). Statement No. 142 was adopted by
the Company on January 1, 2002. The Company must adopt statement No. 143 no
later than January 2003. Statement No. 142 changed the accounting for Goodwill
and other intangible assets, such that those assets whose life is determined to
be indefinite are not subject to amortization. These assets shall be tested for
impairment at least annually, and the value will need to be written down if the
fair value is less than the carrying value. The adoption of Statement No. 142
did not have a significant effect on the Company's financial position or results
of operations. Statement No. 143 requires that a liability must be recognized
for an asset retirement obligation related to long lived tangible assets. The
liability shall be recorded at fair value. The Company anticipates the adoption
of Statement No. 143 will not have a significant effect on its financial
position or results of operations.
In August 2001, the FASB issued statement No. 144 (Accounting for the
Impairment or Disposals of Long-lived Assets). The Company adopted statement No.
144 on January 1, 2002. This statement requires an impairment loss to be
recognized if the carrying value of a long-lived asset (asset group) is not
recoverable and exceeds its fair value. Long-lived assets (asset group) shall be
tested for impairment whenever events or changes in circumstances indicate that
its carrying amount may not be recoverable. The adoption of this statement did
not have an effect on the Company's financial position or results of operations.
ITEM 2 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company is exposed to market risk from changes in foreign currency and
interest rates. The Company manufactures many of its products and components in
the United Kingdom and purchases many components in foreign markets.
Approximately 50% of the Company's revenue is generated from foreign markets.
The Company manages its risk to foreign currency rate changes by maintaining
foreign currency bank accounts in currencies in which it regularly transacts
business and the use of foreign exchange forward contracts. The Company does not
enter into derivative contracts for trading or speculative purposes.
Page 11 of 15
The Company's cash equivalents and short-term investments and its
outstanding debt bear variable interest rates. The rates are adjusted to market
conditions. Changes in the market rate effects interest earned and paid by the
Company. The Company does not use derivative instruments to offset the exposure
to changes in interest rates. Changes in the interest rates related to these
items are not expected to have a material impact on the Company's results of
operations.
Page 12 of 15
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS None
ITEM 2 - CHANGES IN SECURITIES N/A
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES N/A
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS N/A
ITEM 5 - OTHER INFORMATION N/A
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit 11 (Regulation S-K) Computation of Earnings Per Share. Attached
(b) Reports on Form 8-K
No Reports on Form 8-K were filed by the registrant during the periods covered by this report.
Page 13 of 15