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.
As of May 9, 2002, there were 21,878,220 shares of common stock of the Registrant outstanding.
Part I - Financial Information Page
----
Item 1. Consolidated Financial Statements:
Consolidated Balance Sheets as of
March 31, 2002 and December 30, 2001 1
Consolidated Statements of Earnings
for the quarters ended March 31, 2002
and April 1, 2001 2
Consolidated Statement of Shareholders' Equity
and Comprehensive Income for the quarter ended
March 31, 2002 3
Condensed Consolidated Statements of Cash Flows
for the quarters ended March 31, 2002
and April 1, 2001 4
Notes to the Consolidated Financial Statements 5-9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9-13
Item 3. Quantitative and Qualitative Disclosures About
Market Risk 13-14
Part II - Other Information
Item 1. Legal Proceedings 14
Item 2. Changes in Securities and Use of Proceeds 14
Item 3. Defaults Upon Senior Securities 14
Item 4. Submission of Matters to a Vote of Securities
Holders 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 15
March 31, December 30,
Assets 2002 2001
---- ----
Current assets:
Cash and cash equivalents $ 27,715 $ 25,979
Accounts receivable 7,630 6,710
Inventories 13,800 13,437
Prepaid expenses 4,827 3,069
Refundable income taxes 887 3,902
Deferred income taxes 6,792 6,643
-------- --------
Total current assets 61,651 59,740
Property & equipment, less accumulated
depreciation 272,678 269,323
Goodwill, net 19,187 19,187
Deferred income taxes 637 2,276
Other 2,824 2,871
-------- --------
Total assets $356,977 $353,397
======== ========
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 21,541 $ 27,189
Accrued expenses 33,630 37,424
Current installments of obligations under
capital leases 15 58
-------- --------
Total current liabilities 55,186 64,671
Debt, net of current installments 10,000 10,000
Obligations under capital leases, net
of current installments 20,852 20,867
-------- --------
Total liabilities 86,038 95,538
Minority interest 1,352 1,329
Shareholders' equity:
Preferred stock - -
Common stock 182,172 178,787
Unearned compensation-restricted stock (665) (522)
Retained earnings 88,742 79,007
Accumulated other comprehensive loss (503) (583)
Treasury stock at cost; 10,000 shares in
2002 and 2001 (159) (159)
-------- --------
Total shareholders' equity 269,587 256,530
Total liabilities and shareholders' -------- --------
equity $356,977 $353,397
======== ========
See accompanying notes to consolidated financial statements
13 Weeks Ended
----------------------------
March 31, April 1,
2002 2001
Revenues: ------ ------
Restaurant sales:
LongHorn Steakhouse $ 104,385 $94,354
The Capital Grille 21,854 18,992
Bugaboo Creek Steak House 17,246 16,890
Specialty concepts 1,728 1,634
-------- --------
Total restaurant sales 145,213 131,870
Franchise revenues 85 90
-------- --------
Total revenues 145,298 131,960
Costs and expenses: -------- --------
Cost of restaurant sales 52,812 47,888
Operating expenses - restaurants 62,280 54,991
Depreciation and amortization - restaurants 5,760 4,928
Pre-opening expense - restaurants 914 1,771
General and administrative expenses 8,373 7,678
-------- --------
Total costs and expenses 130,139 117,256
-------- --------
Operating income 15,159 14,704
Interest expense, net 449 673
Early termination of interest rate
swap agreement -- 1,100
Minority interest 180 245
-------- --------
Earnings before income taxes 14,530 12,686
Income tax expense 4,795 4,135
-------- --------
Net earnings $ 9,735 $ 8,551
======== ========
Weighted average common shares outstanding:
Basic 21,477 20,042
======== ========
Diluted 22,758 21,616
======== ========
Basic earnings per common share $ 0.45 $ 0.43
======== ========
Diluted earnings per common share $ 0.43 $ 0.40
======== ========
See accompanying notes to consolidated financial statements
Accumulated
Common Stock Other Total
---------------- Restricted Retained Treasury Comprehensive Shareholders'
Shares Amount Stock Earnings Stock Income (Loss) Equity
------ ------ ----- -------- ----- -------- --------
Balance, December 30, 2001 21,522 $178,787 $(522) $79,007 $ (159) $ (583) $256,530
Comprehensive income:
Net earnings -- -- -- 9,735 -- -- 9,735
Change in unrealized loss
from interest rate swaps -- -- -- -- -- 80 80
-------
Total comprehensive income 9,815
-------
Amortization of restricted
stock -- -- 134 -- -- -- 134
Issuance of shares to
retirement plans 11 219 -- -- -- -- 219
Issuance of shares pursuant
to restricted stock award 14 277 (277) -- -- -- --
Issuance of shares pursuant
to exercise of stock
options 187 2,137 -- -- -- -- 2,137
Tax benefit of stock options
exercised -- 752 -- -- -- -- 752
------ -------- ------ ------- -------- ------- --------
Balance, March 31, 2002 21,734 $182,172 $(665) $88,742 $ (159) $ (503) $269,587
====== ======== ====== ======= ======== ======= ========
See accompanying notes to consolidated financial statements
13 Weeks Ended
-----------------------------
March 31, April 1,
2002 2001
------- ------
Cash flows from operating activities:
Net earnings $ 9,735 $ 8,551
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization 6,256 5,600
Changes in working capital accounts (6,132) (7,781)
Minority interest 180 245
Deferred tax(benefit) expense (1,488) (170)
Issuance of common stock to employee
retirement plans 219 --
-------- --------
Net cash provided by operating activities 8,770 6,445
-------- --------
Cash flows from investing activities:
Purchase of property and equipment (9,429) (12,265)
-------- --------
Net cash used by investing activities (9,429) (12,265)
-------- --------
Cash flows from financing activities:
Proceeds from exercise of stock options 2,137 2,098
Proceeds from (repayments of) credit facilities -- (46,000)
Proceeds from issuance of common stock -- 57,623
Distributions to minority partners (157) (228)
Increase in bank overdraft included in accounts
payable and accrued liabilities 473 398
Principal payments on capital leases (58) (8)
-------- --------
Net cash provided by financing activities 2,395 13,883
-------- --------
Net increase in cash and cash equivalents 1,736 8,063
Cash and cash equivalents, beginning of period 25,979 3,771
-------- --------
Cash and cash equivalents, end of period $ 27,715 $ 11,834
======== ========
See accompanying notes to consolidated financial statements
1. Basis of Presentation
The consolidated financial statements of RARE Hospitality International, Inc. and subsidiaries (the “Company”) as of March 31, 2002 and December 30, 2001 and for the quarters ended March 31, 2002 and April 1, 2001 have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. The information furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments), which are, in the opinion of management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures normally presented in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 30, 2001.
The Company operates on a 52 or 53 week fiscal year ending on the last Sunday in December. The fiscal quarters ended March 31, 2002 and April 1, 2001 each contained 13 weeks and are referred to hereafter as the first quarter of 2002 and the first quarter of 2001, respectively.
2. New Accounting Pronouncements
In November 2001, the Emerging Issues Task Force (“EITF”) of the Financial Accounting Standards Board (“FASB”) reached a consensus on EITF Issue 01-9, “Accounting for Consideration Given by a Vendor to a Customer”. EITF 01-9 addresses the recognition, measurement and income statement classification for sales incentives offered to customers. Sales incentives include discounts, coupons, free products or services and generally any other offers that entitle a customer to receive a reduction in the price of a product. Under EITF 01-9, the reduction in the selling price of the product resulting from any sales incentives should be classified as a reduction of revenue. Historically, the Company recognized certain sales incentives as restaurant operating and general and administrative expenses. Although this pronouncement does not have any impact on the Company’s consolidated results of operations or financial position, the presentation prescribed has the effect of reducing sales, restaurant operating expense, and general and administrative expenses. Due to the adoption of EITF 01-9 as of the beginning of fiscal 2002, sales, restaurant operating expense, and general and administrative expenses have been restated for the first quarter of 2001 to conform to the new presentation requirement. Same store sales comparisons for each of the Company’s restaurant concepts for the first quarter of 2002, consist of sales at restaurants opened prior to July 2, 2000 and consistent with prior years are calculated using sales prior to being reduced for discounts, coupons, free products or services.
The Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 142, “Goodwill and Other Intangible Assets”, effective as of the beginning of fiscal year 2002. SFAS No. 142 requires that an intangible asset that is acquired shall be initially recognized and measured based on its fair value. This Statement also provides that goodwill should not be amortized, but shall be tested for impairment annually, or more frequently if circumstances indicate potential impairment, through a comparison of fair value to its carrying amount. In the first quarter of fiscal 2002, the Company ceased amortization of goodwill and performed the required goodwill impairment testing. The impairment test requires the Company to compare the fair value of each reporting unit to its carrying value to determine whether there is an indication that an impairment may exist. If an impairment of goodwill is determined to exist, it is measured as the excess of its carrying value over its fair value. Upon performing the initial test of the carrying value of the Company’s goodwill, it was concluded that there was no current indication of impairment to goodwill. Accordingly, no impairment losses were recorded upon the initial adoption of SFAS No. 142.
As of the date of adoption, the Company had unamortized goodwill in the amount of approximately $19.2 million. Amortization expense related to goodwill was $272,000 and approximately $1.1 million for the first quarter of 2001 and fiscal year 2001, respectively. In accordance with SFAS No. 142, no goodwill amortization expense was recorded in the Company’s financial statements for the first quarter of 2002. For the foreseeable future, management believes the only impact on the Company’s consolidated financial statements from the adoption of SFAS 142 will be the elimination of goodwill amortization expense.
The pro forma effects of the adoption of SFAS No. 142 on net earnings and basic and diluted earnings per share is as follows (in thousands, except per share amounts):
13 Weeks Ended
--------------
March 31, April 1,
2002 2001
--------- --------
Net earnings, as reported $ 9,735 $ 8,551
Goodwill amortization, net of
tax benefit - 169
--------- ---------
Net earnings, pro forma $ 9,735 $ 8,720
========= =========
Basic earnings per common share:
Net earnings, as reported $ 0.45 $ 0.43
Goodwill amortization, net of
tax benefit - 0.01
--------- ---------
Net Earnings, pro forma $ 0.45 $ 0.44
========= =========
Diluted earnings per common share:
Net earnings, as reported $ 0.43 $ 0.40
Goodwill amortization, net of
tax benefit - 0.01
--------- ---------
Net Earnings, pro forma * $ 0.43 $ 0.40
========= =========
* Due to rounding of diluted earnings per share, both net earnings and pro forma net earnings for the period ended April 1, 2001 are $0.40 per share.
In October 2001, the Financial Accounting Standards Board issued SFAS No. 144, "Accounting for the Impairment of Long-Lived Assets", which supercedes SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of", and the accounting and reporting provisions of APB No. 30, "Reporting the Results of Operations - Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions", for the disposal of a segment of a business. SFAS No. 144 retains many of the provisions of SFAS No. 121, but addresses certain implementation issues associated with that statement. The Company adopted SFAS No. 144 effective as of the beginning of fiscal 2002. The adoption of SFAS No. 144 did not have a material impact on the Company's consolidated financial statements.
3. Long-Term Debt
At March 31, 2002, $10 million was outstanding under the Company’s $100 million revolving credit agreement at a weighted average interest rate of 7.77% after considering the effect of the Company’s interest rate swap agreement.
4. Income Taxes
Income tax expense for the first quarter of 2002 has been provided for based on an estimated 33% effective tax rate expected to be applicable for the full 2002 fiscal year. The effective income tax rate differs from applying the statutory federal income tax rate of 35% to pre-tax earnings primarily due to employee FICA tip tax credits (a reduction in income tax expense) and work opportunity tax credits partially offset by state income taxes.
5. Earnings Per Share
Basic earnings per common share equals net earnings divided by the weighted average number of common shares outstanding and does not include the dilutive effect of stock options or restricted stock. Diluted earnings per common share equals net earnings divided by the weighted average number of common shares outstanding, after giving effect to dilutive stock options and restricted stock. A reconciliation between basic and diluted weighted average shares outstanding and the related earnings per share calculation is presented below (in thousands, except per share amounts):
13 Weeks Ended
-------------------------
March 31, April 1,
2002 2001
------ ------
Net earnings $9,735 $8,551
======= =======
Basic weighted average shares outstanding 21,477 20,042
Dilutive effect of stock options 1,196 1,505
Dilutive effect of restricted stock 85 69
------- -------
Diluted weighted average shares outstanding 22,758 21,616
======= =======
Basic earnings per common share $ 0.45 $ 0.43
======= =======
Diluted earnings per common share $ 0.43 $ 0.40
======= =======
6. Derivative Instruments and Comprehensive Income
The Company uses an interest rate swap agreement to effectively fix the interest rate on variable rate borrowings under the Company’s $100 million revolving credit facility. This interest rate swap agreement is classified as a hedge of a cash flow exposure and accordingly, the initial fair value and subsequent changes therein was reported as a component of other comprehensive loss and subsequently reclassified into earnings when the forecasted cash flows affect earnings. The estimated fair value of the Company’s interest rate swap agreement at March 31, 2002 was a payable of $812,000 ($503,000 net of tax benefit). $317,000 of the net payable was classified as current on March 31, 2002. A reconciliation of net earnings and total comprehensive income is as follows (in thousands):
13 Weeks Ended
-------------------------
March 31, April 1,
2002 2001
------ ------
Net earnings $9,735 $8,551
Cumulative effect of change in
accounting principle -- (624)
Change in unrealized loss from interest
rate swap agreement 80 91
------- -------
Total comprehensive income $9,815 $8,018
======= =======
The Company currently derives all of its revenues from restaurant sales and franchise revenues. Total revenues increased 10.1% to approximately $145.3 million for the first quarter of 2002 compared to approximately $132.0 million for the first quarter of 2001.
Same store sales comparisons for each of the Company's restaurant concepts for the first quarter of 2002, consist of sales at restaurants opened prior to July 2, 2000 and are calculated using sales prior to being reduced for discounts, coupons, free products or services.
LongHorn Steakhouse:
Sales in the LongHorn Steakhouse restaurants increased 8.3% to approximately $104.4 million for the first quarter of 2002 compared to approximately $96.4 million for the first quarter of 2001. The increase reflects an 11.8% increase in restaurant operating weeks in the first quarter of 2002 as compared to the prior year, resulting from an increase in the restaurant base from 146 LongHorn Steakhouse restaurants at the end of the first quarter of 2001 to 160 at the end of the first quarter of 2002. Average weekly sales for all LongHorn Steakhouse restaurants in the first quarter of 2002 was $51,120, a 1.0% decrease as compared to the first quarter of 2001. Same store sales for the comparable LongHorn Steakhouse restaurants increased 0.5% in the first quarter of 2002 as compared to the same period in 2001, due to small increases in both guest counts and average check. Same store sales increased during a period in which average weekly sales decreased due to lower than average weekly sales rates for some small market LongHorn Steakhouse restaurants that are not yet in the comparable sales base.
The Capital Grille:
Sales in The Capital Grille restaurants increased 15.1% to approximately $21.9 million for the first quarter of 2002, compared to approximately $19.0 million for the same period in 2001. The increase reflects a 16.8% increase in restaurant weeks in the first quarter of 2002, as compared to the first quarter of 2001. Same store sales during the first quarter of 2002 at The Capital Grille restaurants were level with the same period of the prior year. Average weekly sales for all The Capital Grille restaurants in the first quarter of 2002 were $112,068, a 1.5% decrease from the comparable period in 2001. This decrease in average weekly sales volume is due to the opening of three new The Capital Grille restaurants in fiscal 2001. The Capital Grille restaurants have historically opened at lower sales volumes and, correspondingly, have not experienced the higher honeymoon sales period followed by a sales decline that is commonly characteristic in the restaurant industry.
Bugaboo Creek Steak House:
Sales in the Bugaboo Creek Steak House restaurants increased 2.1% to approximately $17.2 million for the first quarter of 2002, compared to approximately $16.9 million for the same period in 2001. The increase reflects a 2.1% increase in average weekly sales for all Bugaboo Creek Steak House restaurants in the first quarter of 2002 to $69,824 from average weekly sales of $68,379 for the comparable period of 2001. Same store sales for the comparable Bugaboo Creek Steak House restaurants in the first quarter of 2002 increased 3.0% as compared to the same period in 2001, primarily due to an increase in guest counts and average check.
Franchise Revenue:
Franchise revenues decreased to $85,000 for the first quarter of 2002, from $90,000 for the same period in 2001.
Costs and Expenses
Cost of restaurant sales as a percentage of restaurant sales increased to 36.4% for the first quarter of 2002 from 36.3% for the same period of 2001. Favorable contract pricing on red-meat products offset most of the significantly higher produce costs, particularly with respect to lettuce, experienced during the first quarter of 2002. The Company is currently under fixed price contracts with respect to over 90% of its beef and pork products for the remainder of 2002 and into early 2003. Many of the food products, other than beef and pork products, purchased by the Company are affected by commodity pricing and are, therefore, subject to price volatility caused by weather, production problems, delivery difficulties and other factors, which are outside the control of the Company.
Restaurant operating expense as a percentage of restaurant sales increased to 42.9% for the first quarter of 2002 as compared to 41.7% for the same period of 2001. This increase as a percentage of restaurant sales was due to increases in restaurant labor costs and, to a lesser extent, to higher marketing and insurance costs. Restaurant depreciation increased to approximately $5.8 million from approximately $4.9 million in the corresponding period of the prior year primarily due to the depreciation associated with capital lease accounting for the three new The Capital Grille restaurants opened during the first half of 2001 and the cost of remodeling 19 existing LongHorn Steakhouse restaurants during 2001.
Pre-opening expense for the first quarter of 2002 was $914,000, a decrease from approximately $1.8 million in the same period of the prior year. This decrease related to the six restaurants opened during the first quarter of 2002 as compared to thirteen restaurants opened in the same period of the prior year.
General and administrative expenses as a percentage of total revenues decreased slightly for the first quarter of 2002 as compared to the corresponding period of the prior year. This decrease was principally due to the elimination of goodwill amortization in accordance with SFAS No. 142.
As a result of the relationships between revenues and expenses discussed above, the Company’s operating income increased to approximately $15.2 million for the first quarter of 2002 from approximately $14.7 million for the corresponding period of the prior year.
Interest expense, net decreased to $449,000 in the first quarter of 2002 from $673,000 in the same period of the prior year. The decrease in interest expense is due to the timing of the Company’s common stock offering in February 2001.
Minority interest expense decreased to $180,000 for the first quarter of 2002 from $245,000 for the same period of the prior year primarily due to the effect of the Company’s acquisition of the joint venture partner’s interest in three restaurants subsequent to the first quarter of 2001.
Income tax expense for the first quarter of 2002 was 33.0% of earnings before income taxes, based on a 33% effective tax rate expected to be applicable for the full 2002 fiscal year. This compares to 32.6% of earnings before income taxes for the first quarter of 2001. The lower effective income tax rate in the first quarter of 2001 as compared to the first quarter of 2002 is due to the tax benefit realized in 2001 from the early termination of an interest rate swap agreement. The Company’s effective income tax rate differs from applying the statutory federal income tax rate of 35% to pre-tax income, primarily due to employee FICA tip tax credits and work opportunity tax credits partially offset by state income taxes.
Net earnings increased to $9.7 million for the first quarter of 2002 from net earnings of $8.6 million for the first quarter of 2001, reflecting the net effect of the items discussed above.
Liquidity and Capital Resources:
The Company requires capital primarily for the development of new restaurants, selected acquisitions and the remodeling of existing restaurants. During the first quarter of 2002 the Company’s principal sources of working capital were cash provided by operating activities ($8.8 million) and proceeds from the exercise of employee stock options ($2.1 million). For the first quarter of 2002 the principal use of working capital was capital expenditures ($9.4 million) for new and improved facilities. As of March 31, 2002 the Company had $10.0 million outstanding under the Company’s $100 million revolving credit facility. The Company is currently in compliance with the provisions of the revolving credit facility.
The Company intends to open 17 to 20 Company-owned LongHorn Steakhouse restaurants, one The Capital Grille restaurant and two or three Bugaboo Creek Steak House restaurants in fiscal year 2002. The Company estimates that its capital expenditures for fiscal year 2002 will be approximately $65-70 million. During the first quarter of 2002, the Company opened six LongHorn Steakhouse restaurants. Management believes that available cash, cash provided by operations, and available borrowings under the Company’s $100 million revolving credit facility will provide sufficient funds to finance the Company’s expansion plans through the year 2005.
Since substantially all sales in the Company’s restaurants are for cash, and accounts payable are generally due in seven to 30 days, the Company operates with little or negative working capital.
Forward-Looking Statements
Statements contained in this Report concerning future results, performance or expectations are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements in this Report are based upon information available to the Company on the date of this Report. All forward-looking statements involve risks and uncertainties that could cause actual results, performance or developments to differ materially from those expressed or implied by those forward-looking statements, such as: the Company’s ability to open the anticipated number of new restaurants on time and within budget; the Company’s ability to continue to increase same-store sales at anticipated rates, a recession or other negative effect on business dining patterns, or some other negative effect on the economy in general, unexpected increases in cost of sales or other expenses, and the impact of any negative publicity or public attitudes related to the consumption of beef. Other risks and uncertainties include fluctuations in quarterly operating results, seasonality, guest trends, competition and risks associated with the development and management of new restaurant sites. More information about factors that potentially may affect the Company’s results, performance or development is included in the Company’s other filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 30, 2001, and the Company’s press releases and other communications.
Interest Rate Risk
As of May 1, 2002, $10.0 million was outstanding under the Company’s $100 million revolving credit facility. Amounts outstanding under such credit facility bear interest at LIBOR plus a margin of 1.25% to 2.0% (depending on the Company’s leverage ratio), or the administrative agent’s prime rate of interest plus a margin of 0% to 0.75% (depending on the Company’s leverage ratio) at the Company’s option. Accordingly, the Company is exposed to the impact of interest rate fluctuations. To achieve the Company’s objective of managing its exposure to interest rate changes, the Company from time to time uses interest rate swaps.
The Company has an interest rate swap agreement with a commercial bank, which effectively fixes the interest rate at 6.52%, plus the margin on $10.0 million from July 2001 through June 2002; on $15.0 million from July 2002 through March 2003; and on $17.5 million from April 2003 through August 2004. The Company is exposed to credit losses on this interest rate swap in the event of counterparty non-performance, but does not anticipate any such losses.
While changes in LIBOR and the administrative agent’s prime rate of interest could affect the cost of borrowings under the credit facility in excess of amounts covered by the interest rate swap agreement in the future, the Company does not consider its current exposure to changes in such rates to be material, and the Company believes that the effect, if any, of reasonably possible near-term changes in interest rates on the Company’s financial condition, results of operations or cash flows would not be material.
Investment Portfolio
The Company invests portions of its excess cash, if any, in highly liquid investments. At March 31, 2002, the Company had $25.0 million invested in high-grade overnight repurchase agreements.
None
None
None
None
None
| (a) |
Exhibits Filed. 3.1 Amended and Restated Articles of Incorporation of the Company, as amended 3.2 Bylaws of the Company, as amended |
| (b) |
Reports filed on Form 8-K. None |
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.
Date: May 14, 2002 /s/ W. Douglas Benn
--------------- ------------------------
W. Douglas Benn
Executive Vice President, Finance
and Chief Financial Officer
(Principal Financial and
Accounting Officer)