U.S. 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 April 30, 2001.
M.B.A. HOLDINGS, INC.
(Exact name of business issuer as specified in its charter)
Nevada 87-0522680
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9419 E. San Salvador, Suite 105
Scottsdale, AZ 85258-5510
(480)-860-2288
(Address of principal executive offices, including telephone number)
Number of Common Stock shares (.001 par value)
outstanding at May 31, 2001: 1,980,187
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 [ ]
MBA Holdings, Inc
Index
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of April 30, 2001
(Unaudited) and October 31, 2000
Condensed Consolidated Statements of Income (Loss) and
Comprehensive Income (Loss) for the three and six months
ended April 30, 2001 and 2000 (Unaudited)
Condensed Consolidated Statements of Cash Flows for the
six months ended April 30, 2001 and 2000 (Unaudited)
Notes to Condensed Consolidated Financial Statements (Unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Item 3. Quantitative and Qualitative Disclosures about Market Risk
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
SIGNATURES
M.B.A. HOLDINGS, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
APRIL 30, 2001 (UNAUDITED) AND OCTOBER 31, 2000
--------------------------------------------------------------------------------
ASSETS APRIL 30, OCTOBER 31,
2001 2000
------------ ------------
(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 1,192,573 $ 1,128,281
Restricted cash 260,152 487,015
Investments (Note 4) 370,090 442,278
Accounts receivable, net of allowance for
doubtful accounts of $19,025 (2001 and 2000) 310,694 404,370
Prepaid expenses and other assets 94,108 115,074
Deferred direct costs 5,683,890 5,048,367
Income tax receivable 188,126 155,437
Deferred income tax asset 394,454 387,787
------------ ------------
Total current assets 8,494,087 8,168,609
------------ ------------
PROPERTY AND EQUIPMENT:
Computer equipment 241,731 226,777
Office equipment and furniture 167,237 165,919
Vehicle 16,400 16,400
Leasehold improvements 79,596 79,596
Capitalized software costs 27,289 26,959
------------ ------------
Total property and equipment 532,253 515,651
Accumulated depreciation and amortization (267,846) (229,020)
------------ ------------
Property and equipment - net 264,407 286,631
------------ ------------
Other assets 46,169 46,170
Deferred direct costs 7,240,240 7,650,100
Deferred income tax asset 479,487 496,039
------------ ------------
TOTAL $ 16,524,390 $ 16,647,549
============ ============
(Continued)
See notes to condensed consolidated financial statements.
2
M.B.A. HOLDINGS, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
APRIL 30, 2001 (UNAUDITED) AND OCTOBER 31, 2000
--------------------------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY APRIL 30, OCTOBER 31,
2001 2000
------------ ------------
(Unaudited)
CURRENT LIABILITIES:
Net premiums payable to insurance companies $ 332,660 $ 437,214
Accounts payable and accrued expenses 780,331 753,802
Capital lease obligation - current portion 10,147 9,333
Deferred revenues 6,527,726 5,878,696
------------ ------------
Total current liabilities 7,650,864 7,079,045
CAPITAL LEASE OBLIGATION - net of current portion 13,650 18,840
DEFERRED RENT 41,897 41,539
DEFERRED REVENUES 8,428,775 8,961,473
------------ ------------
Total liabilities 16,135,186 16,100,897
------------ ------------
COMMITMENTS AND CONTINGENCIES (Note 6)
STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value; 20,000,000 shares
authorized; none issued and outstanding
Common stock, $.001 par value; 80,000,000 shares
authorized; 2,011,787 (2001 and 2000) shares issued;
1,980,187 (2001 and 2000) shares outstanding 2,012 2,012
Additional paid-in-capital 200,851 200,851
Accumulated other comprehensive income (loss) (10,362) 12,215
Retained earnings 252,203 387,074
Less: 31,600 shares of common stock in treasury, at cost (55,500) (55,500)
------------ ------------
Total stockholders' equity 389,204 546,652
------------ ------------
TOTAL $ 16,524,390 $ 16,647,549
============ ============
See notes to condensed consolidated financial statements.
3
M.B.A. HOLDINGS, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND
COMPREHENSIVE INCOME (LOSS) (UNAUDITED)
THREE AND SIX MONTHS ENDED APRIL 30, 2001 AND 2000
--------------------------------------------------------------------------------
THREE MONTHS ENDED APRIL 30, SIX MONTHS ENDED APRIL 30,
---------------------------- --------------------------
2001 2000 2001 2000
----------- ----------- ----------- -----------
REVENUES:
Vehicle service contract gross income $ 2,054,745 $ 1,249,072 $ 3,742,106 $ 2,428,502
Net mechanical breakdown insurance income 134,772 601,759 411,953 1,172,116
MBI administrative service revenue 159,981 164,250 326,905 326,307
----------- ----------- ----------- -----------
NET REVENUES 2,349,498 2,015,081 4,480,964 3,926,925
----------- ----------- ----------- -----------
OPERATING EXPENSES:
Direct acquisition costs of vehicle service contracts 1,947,326 1,185,335 3,556,564 2,300,647
Salaries and employee benefits 333,813 455,536 699,430 830,945
Mailings and postage 39,226 96,406 70,048 178,599
Rent and lease expense 77,447 73,738 167,710 139,681
Professional fees 20,334 43,748 43,398 85,829
Telephone 25,801 20,580 42,207 45,203
Depreciation and amortization 18,033 22,296 38,826 38,712
Merchant and bank charges 4,023 5,548 7,214 10,767
Insurance 5,428 8,430 16,486 18,717
Supplies 5,975 8,403 10,974 18,889
License and fees 9,067 6,080 12,369 10,250
Other operating expenses 55,371 50,934 86,283 85,595
----------- ----------- ----------- -----------
Total operating expenses 2,541,844 1,977,034 4,751,509 3,763,834
----------- ----------- ----------- -----------
OPERATING INCOME (LOSS) (192,346) 38,047 (270,545) 163,091
Finance fee income 5,206 15,162 10,287 30,869
Interest income 12,774 34,896 28,876 81,315
Interest expense (5,762) (373) (7,956) (763)
Other expense (45) (774)
Realized gains on investments 20,938 20,938
----------- ----------- ----------- -----------
Total other income 33,156 49,640 52,145 110,647
----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES (159,190) 87,687 (218,400) 273,738
INCOME TAXES (59,829) 35,750 (83,529) 110,170
----------- ----------- ----------- -----------
NET INCOME (LOSS) $ (99,361) $ 51,937 $ (134,871) $ 163,568
=========== =========== =========== ===========
BASIC NET INCOME (LOSS) PER SHARE $ (0.05) $ 0.03 $ (0.07) $ 0.08
=========== =========== =========== ===========
DILUTED NET INCOME (LOSS) PER SHARE $ (0.05) $ 0.02 $ (0.07) $ 0.08
=========== =========== =========== ===========
AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING - BASIC 1,980,187 2,011,787 1,980,187 2,011,787
=========== =========== =========== ===========
AVERAGE NUMBER OF COMMON AND
DILUTIVE SHARES OUTSTANDING 1,980,187 2,116,487 1,980,187 2,136,025
=========== =========== =========== ===========
Net income (loss) $ (99,361) $ 51,937 $ (134,871) $ 163,568
Other comprehensive income (loss) net of tax:
Net unrealized loss on available for sale securities (33,302) (22,577)
----------- ----------- ----------- -----------
Comprehensive income (loss) $ (132,663) $ 51,937 $ (157,448) $ 163,568
=========== =========== =========== ===========
See notes to condensed consolidated financial statements.
4
M.B.A. HOLDINGS, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
SIX MONTHS ENDED APRIL 30, 2001 AND 2000
--------------------------------------------------------------------------------
APRIL 30,
----------------------------
2001 2000
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (134,871) $ 163,568
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 38,826 38,712
Deferred income taxes 9,885 (136,421)
Changes in assets and liabilities:
Restricted cash 226,863 278,430
Accounts receivable 93,676 (38,754)
Prepaid expenses and other assets 20,967 11,647
Deferred direct costs (225,663) (1,944,149)
Net premiums payable to insurance companies (104,554) (1,023,761)
Accounts payable and accrued expenses 26,529 (27,301)
Income tax receivable (32,689) (58,409)
Deferred rent 358 4,716
Deferred revenues 116,332 2,110,788
----------- -----------
Net cash provided by (used in) operating activities 35,659 (620,934)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (16,602) (23,670)
Sale (purchase) of marketable securities, net 49,611 (473,326)
----------- -----------
Net cash provided by (used in) investing activities 33,009 (496,996)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on capital lease obligation (4,376)
----------- -----------
Net cash used in financing activities (4,376)
----------- -----------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 64,292 (1,117,930)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 1,128,281 3,424,934
----------- -----------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 1,192,573 $ 2,307,004
=========== ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for interest $ 8,414 $ 1,633
=========== ===========
Cash paid for income taxes $ $ 305,000
=========== ===========
See notes to condensed consolidated financial statements.
5
M.B.A. HOLDINGS, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
SIX MONTHS ENDED APRIL 30, 2001 AND 2000
--------------------------------------------------------------------------------
1. BASIS OF PRESENTATION
In accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation
S-X, the accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with accounting principles generally accepted in the
United States of America for interim financial information. Accordingly, not all
of the information and notes required by generally accepted accounting
principles for complete financial statements are included. The unaudited interim
financial statements furnished herein reflect all adjustments (which include
only normal, recurring adjustments), in the opinion of management, necessary for
a fair statement of the results for the interim periods presented. Operating
results for the three months and six months ended April 30, 2001 may not be
indicative of the results that may be expected for the year ending October 31,
2001. For further information, please refer to the consolidated financial
statements and notes thereto included in the Company's Form 10K for the year
ended October 31, 2000.
2. NET INCOME (LOSS) PER SHARE
Net income (loss) per share is calculated in accordance with Statement of
Financial Acconting Standards ("SFAS") No. 128, EARNINGS PER SHARE which
requires dual presentation of BASIC and DILUTED EPS on the face of the
statements of income (loss) and requires a reconciliation of the numerator and
denominator of basic and diluted EPS calculations. Basic income (loss) per
common share is computed on the weighted average number of shares of common
stock outstanding during each period. Income (loss) per common share assuming
dilution is computed on the weighted average number of shares of common stock
outstanding plus additional shares representing the exercise of outstanding
common stock options using the treasury stock method. Below is the
reconciliation required by SFAS No. 128. All common stock options are
anti-dilutive for the three and six months ended April 30, 2001.
NUMBER OF SHARES USED IN COMPUTING INCOME (LOSS) PER SHARE
THREE MONTHS
ENDED
APRIL 30,
---------------------
2001 2000
--------- ---------
Average number of common shares outstanding - Basic 1,980,187 2,011,787
Dilutive shares from common stock options
calculated using the treasury stock method 104,700
--------- ---------
Average number of common and dilutive shares outstanding 1,980,187 2,116,487
========= =========
SIX MONTHS
ENDED
APRIL 30,
---------------------
2001 2000
--------- ---------
Average number of common shares outstanding - Basic 1,980,187 2,011,787
Dilutive shares from common stock options
calculated using the treasury stock method 124,238
--------- ---------
Average number of common and dilutive shares outstanding 1,980,187 2,136,025
========= =========
6
3. OTHER COMPREHENSIVE INCOME (LOSS)
Other comprehensive income (loss) for the six months ended April 30, 2001
resulted from unrealized losses of $22,577 on available-for-sale investments.
There was no additional other comprehensive income (loss) during the six months
ended April 30, 2001.
4. INVESTMENTS
All of the Company's investments (U.S. treasury bonds and certificates of
deposits) are classified as available-for-sale and are stated at estimated fair
value determined by the quoted market price.
5. TREASURY STOCK
As of April 30, 2001, the Company has purchased 31,600 shares of the Company's
common stock. These shares were purchased for the purpose of retirement and
bonuses to employees. Additional uses of the stock will be explored by
management.
6. COMMITMENTS AND CONTINGENCIES
The Company is subject to claims and lawsuits that arise in the ordinary course
of business, consisting principally of alleged errors and omissions in
connection with the sale of insurance and personnel matters. On the basis of
information presently available, management does not believe the settlement of
any such claims or lawsuits will have a material adverse effect on the financial
position, results of operations or cash flows of the Company.
The Company has available a $300,000 working capital line of credit which was
renewed on February 28, 2001 and expires on February 28, 2002. Borrowings under
the line of credit bear interest at a variable rate per annum equal to the sum
of 3.15 % plus the thirty day dealer commercial paper rate, as published in The
Wall Street Journal and are collateralized by the Company's investments. There
were no borrowings outstanding at April 30, 2001.
7. NEW ACCOUNTING PRONOUNCEMENT
In June 1998, the FASB issued SFAS No. 133, Accounting for Derivative
Instruments and Hedging Activities. SFAS No. 133, as amended, requires that an
enterprise recognize all derivatives as either assets or liabilities in the
balance sheet and measure those instruments at fair value. The Company adopted
SFAS No. 133 effective November 1, 2000, and the adoption did not have a
material impact on the Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
The following discussion should be read in conjunction with the financial
statements and footnotes that appear elsewhere in this report.
FORWARD-LOOKING STATEMENTS:
This report on Form 10-Q contains forward-looking statements. Additional written
or oral forward-looking statements may be made by us from time to time in
filings with the Securities and Exchange Commission or otherwise. The words
"believe," "expect," "anticipate," and "project," and similar expressions
identify forward-looking statements, which speak only as of the date the
statement was made. Such forward-looking statements are within the meaning of
that term in section 27A of the Securities and Exchange Act of 1934, as amended.
Such statements may include, but not be limited to, projections of revenues,
income or loss, capital expenditures, plans for future operations, financing
needs or plans, the impact of inflation, and plans relating to our products or
services, as well as assumptions relating to the foregoing. We undertake no
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events, or otherwise.
Forward-looking statements are inherently subject to risks and uncertainties,
some of which cannot be predicted or quantified. Future events and actual
results could differ materially from those set forth in, contemplated by, or
underlying the forward-looking statements. Statements in this Report, including
the Notes to Condensed Consolidated Financial Statements (Unaudited) and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," describe factors, among others, that could contribute to or cause
such differences.
7
RESULTS OF OPERATIONS
COMPARISON OF THE THREE MONTHS ENDED APRIL 30, 2001 AND 2000
Net revenues for the quarter ended April 30, 2001 totaled approximately
$2,349,000, an increase of $334,000 from net revenues of $2,015,000 for the
quarter ended April 30, 2000. The increase in revenues is primarily due to the
increase in vehicle service contracts ("VSC") sold offset by the decrease in net
mechanical breakdown insurance ("MBI") income. The increase in vehicle service
contracts is due to an increase in the number of dealerships selling automotive
VSCs and recreational vehicle VSCs. The decrease in MBI is due to increased
competition that has resulted in a loss of market share for MBA. Vehicle service
contracts are contracts where the Company is the original obligor and therefore,
these contracts are required to be reported at the gross sales price. The direct
acquisition costs of vehicle service contracts, which would be premiums paid to
the insurance companies and agent commissions, are reported as operating
expenses.
Operating income (loss) decreased by $230,000 to a loss of $192,000 for the
quarter ended April 30, 2001, from operating income of $38,000 for the quarter
ended April 30, 2000. The decrease is due to a $467,000 decrease in MBI revenue.
This decrease in MBI revenue is offset by a decrease in salary and employee
benefits due to a decrease in the number of employees and a decrease in the
mailings and postage expense due to the phase out of the direct mail operations.
The decrease in employees is due to process improvement and technology upgrades.
Total operating expenses including direct vehicle service contract costs were
$2,542,000 for the quarter ended April 30, 2001, compared to $1,977,000 for the
quarter ended April 30, 2000. The increase in direct vehicle service contract
costs were due to the increase in VSC sales offset by decreases in salaries and
employee benefits and mailings and postage.
Total other income decreased by $17,000 from $50,000 for the quarter ended April
30, 2000 to $33,000 for the quarter ended April 30, 2001. The decrease was
primarily due to a decrease in cash and cash equivalents which, in turn,
decreased the interest income earned. In addition, there was a decrease in
finance fee income due to the reduction in the amount of policies financed from
the direct mail operations. This was offset by a gain recognized on securities
sold during the quarter.
Net loss for the quarter ended April 30, 2001 was $99,000 compared to net income
for the quarter ended April 30, 2000 of $52,000, which is a result of the
foregoing factors.
COMPARISON OF THE SIX MONTHS ENDED APRIL 30, 2001 AND 2000
Net revenues for the six months ended April 30, 2001 totaled approximately
$4,481,000, an increase of $554,000 from net revenues of $3,927,000 for the six
months ended April 30, 2000. The increase in revenues is primarily due to the
increase in VSCs sold offset by the decrease in MBI policies sold.
Operating income (loss) decreased by $434,000 to an operating loss of $271,000
for the six months ended April 30, 2001, from an operating income of $163,000
for the six months ended April 30, 2000. The decrease is primarily due to a
decrease in MBI sales during the six months ended April 30, 2001 compared to the
six months ended April 30, 2000. This is offset by the increase in net VSC
revenue and a decrease in salaries and employee benefits and mailings and
postage.
Total operating expenses including direct vehicle service contract costs were
$4,752,000 for the six months ended April 30, 2001, compared to $3,764,000 for
the six months ended April 30, 2000. The increases are due to an increase in
direct vehicle service contract costs offset by a decrease in salaries and
employee benefits and mailings and postage.
Total other income decreased by $59,000 from $111,000 for the six months ended
April 30, 2000 to $52,000 for the six months ended April 30, 2001. The decrease
is primarily due to a decrease in interest income due to less cash, cash
equivalents and restricted cash available for investment during the period. This
is offset by a gain recognized on securities sold.
Net loss for the six months ended April 30, 2001 was $135,000 compared to net
income of $164,000 for the six months ended April 30, 2000, which is a result of
the foregoing factors.
8
LIQUIDITY AND CAPITAL RESOURCES
COMPARISON OF APRIL 30, 2001 AND OCTOBER 31, 2000
Working capital at April 30, 2001 consisted of current assets of $8,494,000 and
current liabilities of $7,651,000, or a current ratio of 1.11:1. At October 31,
2000, the current ratio was 1.15:1 with current assets of $8,169,000 and current
liabilities of $7,079,000.
As of April 30, 2001, the Company's cash position decreased to $1,453,000 from
$1,615,000 at October 31, 2000. Of the $1,453,000, $260,000 is classified as
restricted cash; there was $487,000 of restricted cash at October 31, 2000. The
largest component of the restricted cash represented claims payment advances
provided by insurance companies which enables the Company to make claims
payments on behalf of the insurance companies. The decrease in cash is due to
the timing of when the Company receives cash from the insurance companies for
claims payments.
Deferred direct costs, including both the current and non-current portions,
increased by $226,000 to $12,924,000 at April 30, 2001 from $12,698,000 at
October 31, 2000. Direct costs are costs that are directly related to the sale
of VSCs. These costs are deferred in the same proportion as VSC revenue. The
increase in these costs is due to less costs recognized as expense than deferred
onto the balance sheet from an increase in sales.
The Company collects funds throughout the year and remits a portion of the funds
to the insurance companies. As of April 30, 2001, the amount owed to the
insurance companies decreased to $333,000 from $437,000 at October 31, 2000,
which is due to the timing of payments remitted to the insurance companies.
Deferred revenues, including both the current and non-current portions,
increased by $117,000 to $14,957,000 at April 30, 2001 from $14,840,000 at
October 31, 2000. Deferred revenue consists of VSC gross sales and estimated
administrative service fees relating to the sales of MBI policies. The increase
is primarily due to the increase in VSC sales offset by the decrease in MBI
sales.
The Company is operating with a working capital line of credit from Merrill
Lynch. This is the only debt utilized by the Company. The working capital line
of credit is used to make claims payment if there is a timing difference between
when the Company pays for the claims and when the claims are reimbursed by the
insurance companies. The Company's ability to fund its operations over the
short-term is not hindered by lack of short-term financing. The Company uses
premiums received to pay agent commissions and fund operations and claims
payment advances provided by insurance companies to administer and pay claims.
The Company believes its current working capital plus future anticipated cash
flows from operations will be sufficient to meet cash requirements for the
foreseeable future.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Since the Company does not underwrite its own policies, a change in the current
rates of inflation or hyperinflation is not expected to have a material effect
on the Company. However, the precise effect of inflation on operations can not
be determined.
The Company does not have any outstanding debt or long-term receivables.
Therefore, it is not subject to significant interest rate risk.
Due to increased competition, the Company has seen a substantial loss in MBI
market share. This is offset by an increase in market share of the VSCs. The
future effect of this increased competition may have an adverse effect on future
earnings.
9
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is subject to claims and lawsuits that arise in the ordinary course
of business, consisting principally of alleged errors and omissions in
connection with the sale of insurance and personnel matters. On the basis of
information presently available, management does not believe the settlement of
any such claims or lawsuits will have a material adverse effect on the financial
position, results of operations or cash flows of the Company.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None
10
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereto duly authorized. MBA Holdings, Inc.
By: /s/ Gaylen Brotherson Dated: June 12, 2001
----------------------------------- -------------
Gaylen Brotherson
Chairman of the Board and Chief Executive Officer
By: /s/ Michael J. Zimmerman Dated: June 12, 2001
----------------------------------- -------------
Michael J. Zimmerman,
Chief Financial Officer
11