UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
-------------------------
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended Commission file number
MARCH 20, 2001 000-22753
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TOTAL ENTERTAINMENT RESTAURANT CORP.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 52-2016614
-------- ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
9300 EAST CENTRAL AVENUE
SUITE 100
WICHITA, KANSAS 67206
(Address of principal executive offices) (Zip code)
(316) 634-0505
(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.
X YES NO
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 April 19, 2001
-----
COMMON STOCK, $.01 PAR VALUE 8,666,111 SHARES
TOTAL ENTERTAINMENT RESTAURANT CORP.
INDEX
PAGE
NUMBER
PART I. FINANCIAL INFORMATION ------
-------------------------------
ITEM 1. CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
CONDENSED CONSOLIDATED BALANCE SHEETS AT
MARCH 20, 2001 AND DECEMBER 26, 2000 2
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS FOR THE TWELVE WEEKS ENDED
MARCH 20, 2001 AND MARCH 21, 2000 3
CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS FOR THE TWELVE WEEKS ENDED
MARCH 20, 2001 AND MARCH 21, 2000 4
NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS 5
ITEM 2. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS 6
ITEM 3. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK 10
PART II. OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES 11
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 11
-1-
TOTAL ENTERTAINMENT RESTAURANT CORP.
Condensed Consolidated Balance Sheets
(Unaudited)
March 20, 2001 December 26, 2000
-------------------- --------------------
ASSETS
Current assets:
Cash and cash equivalents $ 3,056,108 $ 2,244,606
Inventories 1,113,361 1,028,975
Deferred income taxes 159,814 161,206
Other current assets 723,041 579,594
----------- -----------
Total current assets 5,052,324 4,014,381
Property and equipment:
Land 600,000 600,000
Buildings 670,629 670,629
Leasehold improvements 22,707,431 21,851,941
Equipment 13,511,102 13,397,524
Furniture and fixtures 3,348,960 3,265,386
----------- -----------
40,838,122 39,785,480
Less accumulated depreciation and amortization 9,828,752 9,022,781
----------- -----------
31,009,370 30,762,699
Other assets:
Goodwill, net of accumulated amortization 3,848,951 3,905,296
Deferred income taxes 1,021,562 1,059,839
Other assets 510,812 385,385
----------- -----------
Total other assets 5,381,325 5,350,520
----------- -----------
Total assets $41,443,019 $40,127,600
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of notes payable $ 1,224,292 $ 418,108
Accounts payable 2,226,403 3,520,542
Sales tax payable 550,195 442,297
Accrued payroll 593,522 775,012
Accrued payroll taxes 265,449 242,134
Accrued income taxes 910,490 1,009,592
Lease obligation for closed store 237,528 263,924
Other accrued liabilities 910,867 777,504
------------ ------------
Total current liabilities 6,918,746 7,449,113
Notes payable 12,390,708 11,561,892
Deferred revenue 122,626 129,549
Stockholders' Equity:
Preferred stock - -
Common stock 86,661 87,414
Additional paid-in capital 17,134,948 17,301,511
Retained earnings 4,789,330 3,598,121
------------ ------------
Total stockholders' equity 22,010,939 20,987,046
------------ ------------
Total liabilities and stockholders' equity $41,443,019 $40,127,600
============ ============
See accompanying notes.
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TOTAL ENTERTAINMENT RESTAURANT CORP.
Condensed Consolidated Statements of Operations
(UNAUDITED)
Twelve weeks Twelve weeks
ended ended
March 20, 2001 March 21, 2000
--------------------- ----------------------
Sales:
Food and beverage $14,906,505 $12,268,635
Entertainment and other 1,530,512 1,381,155
------------ ------------
Total net sales 16,437,017 13,649,790
Costs and expenses:
Costs of sales 4,450,827 3,543,680
Entertainment and restaurant operating expenses 8,024,978 6,431,171
Depreciation and amortization 816,399 837,475
Preopening costs 71,407 6,420
------------ ------------
Entertainment and restaurant costs and expenses 13,363,611 10,818,746
------------ ------------
Entertainment and restaurant operating income 3,073,406 2,831,044
General and administrative expenses 866,848 957,954
Goodwill amortization 56,345 56,345
------------ ------------
Income from operations 2,150,213 1,816,745
Other income (expense):
Loss on disposal of assets (23,290) (25,691)
Other income, principally interest 40 -
Interest expense (254,639) (249,283)
------------ ------------
Income before provision for income taxes 1,872,324 1,541,771
Provision for income taxes 681,115 570,455
------------ ------------
Net income $ 1,191,209 $ 971,316
============ ============
Basic and diluted earnings per share $ 0.14 $ 0.10
============ ============
See accompanying notes.
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TOTAL ENTERTAINMENT RESTAURANT CORP.
Condensed Consolidated Statement of Cash Flows
(UNAUDITED)
Twelve weeks Twelve weeks
ended ended
March 20, 2001 March 21, 2000
-------------------------------------------
Cash flows from operating activities:
Net income $ 1,191,209 $ 971,316
Adjustments to reconcile net income to net cash
provided by operating activities:
Loss on disposal of assets 23,290 25,691
Depreciation and amortization 885,037 899,042
Deferred income taxes 39,669 47,083
Net change in operating assets and liabilities:
Change in operating assets (360,593) (64,189)
Change in operating liabilities (256,301) (324,286)
----------- -----------
Net cash provided by operating activities 1,522,311 1,554,657
Cash flows from investing activities:
Purchases of property and equipment (2,186,493) (151,745)
Proceeds from disposal of assets 8,000 26,700
----------- -----------
Net cash used in investing activities (2,178,493) (125,045)
Cash flows from financing activities:
Proceeds from revolving note payable to bank 13,500,000 9,615,000
Payments of revolving note payable to bank (11,865,000) (10,705,000)
Purchases of common stock (167,316) (419,687)
----------- -----------
Net cash provided by (used in) financing activities 1,467,684 (1,509,687)
----------- -----------
Net increase (decrease) in cash and cash equivalents 811,502 (80,075)
Cash and cash equivalents at beginning of period 2,244,606 2,550,469
----------- -----------
Cash and cash equivalents at end of period $ 3,056,108 $ 2,470,394
=========== ===========
Supplemental disclosure of cash flow information:
Cash paid for interest $ 273,420 $ 277,283
Cash paid for income taxes 740,547 805,164
Supplemental disclosure of non cash activity:
Additions to property and equipment in accounts
payable 1,087,173 -
See accompanying notes.
- 4 -
TOTAL ENTERTAINMENT RESTAURANT CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION AND DESCRIPTION OF BUSINESS
-------------------------------------------------
The unaudited condensed consolidated financial statements 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
generally accepted accounting principles have been omitted pursuant to such
rules and regulations. These financial statements should be read in conjunction
with the Company's audited consolidated financial statements in its 2000 Form
10-K. The results of the twelve weeks ended March 20, 2001 are not necessarily
indicative of the results to be expected for the full year ending December 25,
2001.
2. STOCK OPTIONS
-------------
During the twelve week period ended March 20, 2001, the Company cancelled
options for 42,960 shares with a weighted average exercise price of $3.49 per
share pursuant to its 1997 Incentive and Nonqualified Stock Option Plan. The
Company granted to certain non-employee Directors stock options for 12,000
shares of Common Stock at exercise prices ranging from $1.88 to $2.06 per share
pursuant to its 1997 Directors Stock Option Plan.
3. EARNINGS PER SHARE
------------------
Basic earnings per share amounts are computed based on the weighted
average number of shares actually outstanding. The number of weighted averaged
shares outstanding for the twelve week periods ended March 20, 2001 and March
21, 2000 were 8,682,868 and 9,595,258, respectively.
For purposes of diluted computations, the number of shares that would be
issued from the exercise of stock options has been reduced by the number of
shares which could have been purchased from the proceeds at the average market
price of the Company's stock or the price of the Company's stock on the exercise
date if options were exercised during the period presented. The number of shares
resulting from this computation of diluted earnings per share for the twelve
weeks ended March 20, 2001 and March 21, 2000 were 8,698,594 and 9,596,314,
respectively.
-5-
ITEM 2. MANAGEMENT'S DISCUSSION AND ANAYSIS OF FINANCIAL CONDITION AND RESULTS
-----------------------------------------------------------------------
OF OPERATIONS
-------------
GENERAL
The following discussion and analysis should be read in conjunction with
the Financial Statements and Notes thereto included elsewhere in this Form 10-Q.
As of March 20, 2001, the Company owned and operated 38 entertainment and
restaurant locations under the Fox and Hound English Pub & Grille ("Fox and
Hound"), Bailey's Sports Grille and Bailey's Pub & Grille ("Bailey's") brand
names. The Company's entertainment restaurant locations combine a comfortable
and inviting social gathering place, full menu and full-service bar,
state-of-the-art audio and video systems for sports and music entertainment,
traditional games of skill such as pocket billiards and a late-night dining
alternative, all in a single location. As of March 20, 2001, the Company owned
and operated 25 Fox and Hound units and 13 Bailey's units located in Alabama,
Arkansas, Georgia, Illinois, Indiana, Kansas, Louisiana, Michigan, Missouri,
Nebraska, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee and
Texas. As of March 21, 2000, the Company owned and operated 23 Fox and Hound
units and 12 Bailey's units.
The components of the Company's net sales are food and non-alcoholic
beverages, alcoholic beverages, and entertainment and other. For the twelve
weeks ended March 20, 2001, food and non-alcoholic beverages were 31.1% of total
sales, alcoholic beverages were 59.6% of total sales and entertainment and other
were 9.3% of total sales. For the twelve weeks ended March 21, 2000, food and
non-alcoholic beverages were 32.6% of total sales, alcoholic beverages were
57.3% of total sales and entertainment and other were 10.1% of total sales
Components of restaurant operating expenses include operating payroll and
fringe benefits, occupancy, advertising and promotion. These costs are generally
variable and will fluctuate with changes in sales volume and sales mix. All but
one of the Company's locations are leased and provide for a minimum annual rent,
with some leases calling for additional rent based on sales volume at the
particular location in excess of specified minimum levels.
General and administrative expenses include all corporate and
administrative functions that support existing operations and provide an
infrastructure to support future growth. Management, supervisory and staff
salaries, employee benefits, travel, information systems, training, rent and
office supplies as well as accounting services fees are major items of costs in
this category.
-6-
RESULTS OF OPERATIONS
The following table sets forth for the periods indicated (i) the
percentages which certain items included in the Condensed Consolidated Statement
of Operations bear to net sales, and (ii) other selected operating data:
TWELVE WEEKS ENDED(1)
---------------------
MARCH 20, MARCH 21,
2001 2000
--------- ---------
OPERATING STATEMENT DATA:
Net sales......................................................... 100.0% 100.0%
Costs and expenses:
Costs of sales................................................ 27.1 26.0
Entertainment and restaurant operating expenses............... 48.8 47.1
Depreciation and amortization................................. 5.0 6.1
Preopening costs.............................................. 0.4 0.1
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Entertainment and restaurant costs and expenses........... 81.3 79.3
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Entertainment and restaurant operating income..................... 18.7 20.7
General and administrative expenses............................... 5.3 7.0
Goodwill amortization............................................. 0.3 0.4
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Income from operations............................................ 13.1 13.3
Loss on disposal of assets........................................ (0.1) (0.2)
Interest expense.................................................. (1.6) (1.8)
-------- ------
Income before provision for income taxes.......................... 11.4 11.3
Provision for income tax expense.................................. 4.2 4.2
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Net income (loss)................................................. 7.2% 7.1%
======= ======
RESTAURANT OPERATING DATA (DOLLARS IN THOUSANDS):
Annualized average weekly sales per location (2).................. $1,874 $1,689
Number of restaurants at end of the period........................ 38 35
(1) The Company operates on a fifty-two or fifty-three week fiscal year ending
the last Tuesday in December. The fiscal quarters for the Company consist
of accounting periods of twelve, twelve, twelve and sixteen or seventeen
weeks, respectively.
(2) Annualized average weekly sales per location are computed by dividing net
sales for full weeks open during the period by the number of full weeks
open and multiplying the result by fifty-two.
TWELVE WEEKS ENDED MARCH 20, 2001 COMPARED TO TWELVE WEEKS ENDED MARCH 21, 2000
Net sales increased $2,787,000 (20.4%) for the twelve weeks ended March 20,
2001 to 16,437,000 from $13,650,000 for the twelve weeks ended March 21, 2000.
This increase is due to an increase in same store sales for units open more than
18 months of 6.1% and higher average unit volumes in the three units opened in
the fourth quarter of 2000.
Costs of sales, primarily food and beverages, increased $907,000 (25.6%)
for the twelve weeks ended March 20, 2001 to $4,451,000 from $3,544,000 in the
twelve weeks ended March 21, 2000, and increased as a percentage of sales to
27.1% from 26.0%. This increase as a percentage of sales is principally
attributable to higher food costs associated with a new menu implemented in the
first quarter of 2001 and an increase in certain raw product costs.
Entertainment and restaurant operating expenses increased $1,594,000
(24.8%) for the twelve weeks ended March 20, 2001 to $8,025,000 from $6,431,000
in the twelve weeks ended March 21, 2000, and increased as a percentage of net
sales to 48.8% from 47.1%. This increase is
-7-
attributable to the higher hourly labor costs in the three new units open in the
fourth quarter of 2000, higher hourly labor costs associated with a new menu
implemented in the first quarter of 2001, and higher utility costs.
Depreciation and amortization decreased $21,000 (2.5%) for the twelve weeks
ended March 20, 2001 to $816,000 from $837,000 in the twelve weeks ended March
21, 2000, and decreased as a percentage of sales to 5.0% from 6.1%. This net
decrease is due principally to depreciation in 2000 on assets in two units for
which an impairment charge was taken in the fourth quarter of 2000 and
depreciation in 2000 on certain assets with a two-year life which were added in
1998. No depreciation charge was incurred on these assets in 2001. This decrease
was offset by depreciation incurred during 2001 on three units which were opened
in the fourth quarter of 2000.
Preopening costs increased to $71,000 for the twelve weeks ended March 20,
2001 from $6,000 in the twelve weeks ended March 21, 2000 and increased as a
percentage of net sales to 0.4% from 0.1%. This increase is attributable to the
costs incurred for units which have yet to open.
General and administrative expenses decreased $91,000 (9.5%) for the twelve
weeks ended March 20, 2001 to $867,000 from $958,000 in the twelve weeks ended
March 21, 2000, and decreased as a percentage of sales to 5.3% from 7.0%. This
decrease is attributable primarily to the realignment of certain executive
office positions during 2000.
Loss on disposal of assets was $23,000 for the twelve weeks ended March 20,
2001 and $26,000 for the twelve weeks ended March 21, 2000. The losses reflect
the disposal of certain video games for several units in both years.
Interest expense was $255,000 for the twelve weeks ended March 20, 2001 and
$249,000 for the twelve weeks ended March 21, 2000. This increase is due to a
higher interest rate applicable to the revolving note payable in the current
year compared with the prior year offset by a lower average balance on the
revolving note payable during the current year compared with the prior year.
The effective income tax rate was 36.4% for the twelve weeks ended March
20, 2001 and 37.0% for the twelve weeks ended March 21, 2000.
QUARTERLY FLUCTUATIONS, SEASONALITY AND INFLATION
The timing of new unit openings will result in significant fluctuations
in quarterly results. The Company expects seasonality to be a factor in the
results of its business in the future due to expected lower second and third
quarter revenues due to the summer season. The primary inflationary factors
affecting the Company's operations include food, liquor and labor costs. A large
number of the Company's restaurant personnel are tipped employees who are paid
at the federal subminimum wage level; therefore, future subminimum wage changes
will have a significant effect on labor costs. As costs of food and labor have
increased, the Company has historically been able to offset these increases
through economies of scale, improved operating procedures and menu price
changes; however, short-term fluctuations in raw product pricing may have an
impact on the Company's costs of food. To date, inflation has not had a material
impact on operating margins.
-8-
LIQUIDITY AND CAPITAL RESOURCES
As is customary in the restaurant industry, the Company operates with
negative working capital. Negative working capital decreased $1,569,000 to
$1,866,000 as of March 20, 2001 from $3,435,000 as of December 26, 2000. This
decrease is attributable to a decrease in accounts payable related to new unit
expansion including a decrease of $1,087,000 in property and equipment additions
included in accounts payable at March 20, 2001 compared to December 26, 2000.
Cash increased $812,000 offset by an increase of $806,000 related to current
portion of notes payable at March 20, 2001 compared to the balance at December
26, 2000. The Company does not have significant receivables or inventory and
receives trade credit based upon negotiated terms in purchasing food and
supplies. Because funds available from cash sales are not needed immediately to
pay for food and supplies, or to finance inventory, they may be considered as a
source of financing for noncurrent capital expenditures.
On September 1, 1998 the Company entered into a loan agreement with Intrust
Bank, N.A. (the "Facility") which provides for a line of credit of $20,000,000
subject to certain limitations based on earnings before interest, taxes,
depreciation and amortization of the past fifty-two weeks. The Facility requires
monthly payments of interest only until November 1, 2001, at which time equal
monthly installments of principal and interest are required as necessary to
fully amortize the outstanding indebtedness plus future interest over a period
of four years. Interest is accrued at 1/2% below the prime rate as published in
THE WALL STREET JOURNAL. Proceeds from the Facility are being used for
restaurant development and stock repurchases. As of March 20, 2001 the Company
had borrowed $13,615,000 under the Facility. The Company is in compliance with
all debt covenants.
Cash flows from operations were $1,522,000 in the twelve weeks ended March
20, 2001 compared to $1,555,000 in the twelve weeks ended March 21, 2000.
Purchases of property and equipment were $2,186,000 in 2001 compared to $152,000
in 2000. Net advances of the revolving note payable to bank was $1,635,000 for
the twelve week period ending March 20, 2001 compared to net payments of
$1,090,000 for the twelve week period ending March 21, 2000. The Company spent
$167,000 to repurchase 75,300 shares of common stock in 2001 compared to
$420,000 of common stock repurchases in 2000. At March 20, 2001, the Company had
$3,056,000 in cash and cash equivalents.
The Company intends to open up to seven new locations in 2001 and between
seven and ten locations in 2002. Two units have been opened since March 20,
2001, five leases have been executed and four units are currently in the lease
negotiation process. The Company is currently evaluating locations in markets
familiar to its management team. However, the number of locations actually
opened and the timing thereof may vary depending upon the ability of the Company
to locate suitable sites and negotiate favorable leases. The Company expects to
expend approximately $10.0 to $13.0 million to open new locations over the next
twelve months.
The Company believes the funds available from the Facility and its cash
flow from operations will be sufficient to satisfy its working capital and
capital expenditure requirements for at least the next twelve months. There can
be no assurance, however, that changes in the Company's operating plans, the
acceleration or modification of the Company's expansion plans, lower than
anticipated revenues, increased expenses, stock repurchases, potential
acquisitions or other events will not cause the Company to seek additional
financing sooner than anticipated, prevent the Company from achieving the goals
of its expansion strategy or prevent any newly opened locations from operating
profitably. There can be no assurance that additional financing will be
available on terms acceptable to the Company or at all.
-9-
FORWARD LOOKING STATEMENTS
This report contains certain 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, which are intended to be covered by
the safe harbors created thereby. Although the Company believes that the
assumptions underlying the forward-looking statements contained herein are
reasonable, any of the assumptions could be inaccurate, and, therefore, there
can be no assurance that the forward-looking statements included in this report
will prove to be accurate. Factors that could cause actual results to differ
from the results discussed in the forward-looking statements include, but are
not limited to, potential increases in food and liquor costs, competition and
the inability to find suitable new locations. In light of the significant
uncertainties inherent in the forward-looking statements included herein, the
inclusion of such information should not be regarded as a representation by the
Company or any other person that the objectives and plans of the Company will be
achieved.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
----------------------------------------------------------
INTEREST RATE RISK
The Company's Facility has a variable rate which is directly affected by
changes in U.S. interest rates. The average interest rate of the Facility was
8.60% for the twelve weeks ended March 20, 2001. The interest rate at March 20,
2001 was 8.00%. The following table presents the quantitative interest rate
risks at March 20, 2001:
PRINCIPAL AMOUNT BY EXPECTED MATURITY
Principal Amount by Expected Maturity
-------------------------------------------------------------
(In thousands)
Fair
There- Value
(DOLLARS IN THOUSANDS) 2001 2002 2003 2004 2005 AFTER TOTAL 3/20/01
---------------------- ---- ---- ---- ---- ---- ----- ----- -------
Variable rate debt $485 $3,048 $3,301 $3,575 $3,206 $-- $13,615 $13,615
Average Interest Rate--
1/2% below prime 8.00% 8.00% 8.00% 8.00% 8.00% 8.00%
-10-
PART II. OTHER INFORMATION
---------------------------
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
-----------------------------------------
SECURITIES SOLD
---------------
(c) The following unregistered securities were issued by the Company during
the twelve weeks ended March 20, 2001:
Number of Shares
Description of Sold/Issued/Subject Offering/Exercise
DATE OF SALE/ISSUANCE SECURITIES ISSUED TO OPTIONS OR WARRANTS PRICE PER SHARE
--------------------- ----------------- ---------------------- ---------------
January 7, 2001 Common Stock Options 3,000 $ 1.875
January 7, 2001 Common Stock Options 3,000 $ 1.875
January 14, 2001 Common Stock Options 3,000 $ 2.063
January 14, 2001 Common Stock Options 3,000 $ 2.063
All of the above options were granted to non-employee directors pursuant
to the Directors Stock Option Plan. The options for non-employee
directors have a vesting period of three years and a life of five years.
The issuance of these securities is claimed to be exempt from
registration pursuant to Section 4(2) of the Securities Act of 1933, as
amended, as transactions by an issuer not involving a public offering.
There were no underwriting discounts or commissions paid in connection
with the issuance of any of these securities.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
--------------------------------
Exhibits
None
Reports on Form 8-K
None
-11-
TOTAL ENTERTAINMENT RESTAURANT CORP.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed in its behalf by the
undersigned thereunto duly authorized.
TOTAL ENTERTAINMENT RESTAURANT CORP.
(Registrant)
Date MAY 4, 2001 /s/ JAMES K. ZIELKE
-------------------- ---------------------
James K. Zielke
Chief Financial Officer,
Secretary and Treasurer
(Duly Authorized Officer)
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