STERLING CAPITAL CORPORATION
Report for the Six Months Ended June 30, 1996
OFFICERS
Walter Scheuer ...................Chairman of the Board of Directors
Wayne S. Reisner .................President
Richard Kaufman ..................Executive Vice President and Treasurer
Tracey Schadewald ................Secretary
DIRECTORS
Jay Eliasberg Nathan Kingsley
Arthur P. Floor Archer Scherl
Walter Scheuer
Transfer Agent and Registrar Custodian
Registrar and Transfer Company Chase Manhattan Bank
10 Commerce Drive 4 New York Plaza
Cranford, New Jersey 07016 New York, New York 10004
Auditors General Counsel
Stavisky, Knittle, Isaacs Skadden, Arps,
& Dichek, C.P.A., P.C. Slate, Meagher & Flom
342 Madison Avenue 919 Third Avenue
New York, New York 10173 New York, New York 10022
STERLING CAPITAL CORPORATION
635 Madison Avenue
New York, N.Y. 10022
August 22, 1996
To our Shareholders:
The performance of stocks and bonds diverged sharply during the
first half of 1996 with stocks as measured by the S&P 500 Index
appreciating by 8.9% and bonds as measured by the Lehman Long
Bond Index declining -6.7%. The downturn in the fixed income
markets was caused by an acceleration in the rate of economic
growth and several stronger than expected monthly employment
reports. Preliminary GDP reports for the second quarter showed
a real growth rate of 4.2% versus increases of 2.0% and 0.3% in
the prior two quarters and real growth of 1.3% for 1995. Job
creation in the first half of 1996 totaled 1.6 million which
represented an average monthly gain of 266,000 jobs. This
economic climate represented a change from the modest growth and
inflation experienced throughout 1995 and caused investors to
abandon expectations of further interest rate reductions by the
Federal Reserve and focus on the possibility of an interest rate
increase. Our assessment earlier this year that the risk/reward
ratio for bonds was unfavorable proved accurate and caused us to
avoid the sharp decline in bond prices. Despite the current
availability of higher yields on bonds, we have not
significantly extended maturities on the fixed income portion of
our portfolio.
With respect to equities, the unprecedented strong demand for
stocks which fueled price increases during the past eighteen
months is showing signs of slowing with the latest monthly cash
inflow into equity mutual funds substantially below prior
months. In addition, supply is increasing with the volume of
new issues and secondary offerings of stock accelerating.
Corporate profits are still showing gains, but the rate of
increase appears to be slowing. Lastly, stock valuations remain
high by historical measures with the price-to-dividend ratio and
the price-to-book value ratio particularly worrisome. As a
result, we are maintaining a less than fully weighted position
in equities and a higher than normal allocation of cash and
equivalents.
Enclosed is a report of our Corporation's operations for the
six months ended June 30, 1996. The unaudited net asset value
per share of the Corporation's Common Stock as at June 30, 1996
was $7.99, as compared with its audited net asset value at
December 31, 1995 of $7.49 per share, in both instances giving
effect to the Corporation's distribution to shareholders of $.65
per share paid on January 18, 1996 to shareholders of record at
the close of business on December 26, 1995. As at August 19,
1996 the unaudited net asset value per share was approximately
$7.92 after further giving effect to a distribution to
shareholders of $.052 per share, payable on September 3, 1996 to
shareholders of record at the close of business on August 8,
1996. As at June 30, 1996 and August 19, 1996 the closing sales
price for shares of the Corporation's Common Stock on the
American Stock Exchange was $6.00 and $6.25, respectively. Thus,
as at June 30, 1996 and August 19, 1996 the market price for the
Corporation's shares represented discounts of approximately 25%
and 21%, respectively, from the Corporation's net asset values
at such dates.
Certain of the Corporation's officers and directors and their
associates may from time to time add to their investments in the
Corporation's Common Stock by open market purchases or in
private transactions. Since January 1, 1996 certain of the
Corporation's officer's and directors and their associates have
purchased an aggregate of 7,300 shares of the Corporation's
capital stock. Officers and directors of the Corporation
currently own beneficially, directly or indirectly, an aggregate
of 1,867,096 shares (74.7% of the outstanding shares) of the
Corporation's capital stock, not including 101,000 shares (4.04%
of the Corporation's outstanding shares) owned by certain
associates of such persons with respect to which such officers
and directors disclaim any beneficial interest.
Very truly yours,
Wayne S. Reisner
President
<PAGE>
STERLING CAPITAL CORPORATION
INVESTMENTS IN SECURITIES
As at June 30, 1996
(Unaudited)
Number of Market Value
Shares (Note A)
Common and Preferred Stocks - 60.26%
Real Estate and Real Estate Investment Trusts - 12.94%
Capstead Mortgage ................. 22,500 $ 630,000
Camden Property Trust ............ 24,000 570,000
Oasis Residential................ 20,000 437,500
General Growth Properties......... 15,000 361,875
ROC Communities .................. 15,000 358,125
Catellus Development Corp. ....... 25,000 228,125
$2,585,625
Financial Services and Insurance - 12.61%
Chase Manhattan Corp. ............ 7,500 $529,688
American Express Co. ............. 10,000 446,250
Mellon Bank Corp. ................ 6,000 342,000
PartnerRe Ltd.................... 10,000 298,750
Fleet Financial Group ............ 5,000 217,500
Norwalk Savings Society ........... 10,000 217,500
Marsh & McLennan .................. 2,000 193,000
Long Island Bancorp ............... 5,000 152,815
USF&G Corp........................ 7,500 121,875
$2,519,378
Telecommunication and Media - 9.23%
BCE, Inc.......................... 10,000 $395,000
Cellular Technical Services *..... 20,000 352,500
Airtouch Communications Corporation * 10,000 282,500
News Corp. Ltd ADS ............... 10,000 235,000
Vanguard Cellular Systems *....... 10,000 217,500
Nokia Corp. ADR ................... 5,000 185,000
Tele-Communications Int'l *....... 10,000 176,250
$1,843,750
________________
* Non-income producing security
The accompanying notes are an integral part of these statements
<PAGE>
STERLING CAPITAL CORPORATION
INVESTMENTS IN SECURITIES - continued
As at June 30, 1996
(Unaudited)
Number of Market Value
Shares (Note A)
Technology - 5.07%
Parkervision Inc. *.... 33,000 $437,250
Avnet, Inc............ 5,000 210,625
Lucent Technologies .... 5,000 189,375
Bay Networks Inc. *.... 4,000 103,000
Madge Networks *..... 5,000 72,500
$1,012,750
Retail - 3.85%
Carson Pirie Scott & Co. *.. 15,000 $401,250
J C Penny Inc.............. 2,500 131,250
OfficeMax Inc.*........... 5,000 119,375
Limited Inc.............. 5,439 116,938
$768,813
Healthcare Products and Services - 3.68%
FoxMeyer Health $4.20 Preferred . 10,810 $291,870
Bristol-Myers Squibb Co. ....... 3,000 270,000
Mylan Laboratories ............. 10,000 173,750
$735,620
Publishing - 2.64%
K-III Communications Senior
Exchangeable Preferred ..... 20,000 $527,500
Chemical Products - 2.48%
Rhone Poulenc S.A. ADR......... 10,000 $265,000
Rhone Poulenc Overseas LTD 8.125%
Preferred Series A.......... 10,000 $231,250
$496,250
Transportation Services - 2.11%
Ryder System Inc. .............. 15,000 $421,875
________________
* Non-income producing security
The accompanying notes are an integral part of these statements
<PAGE>
STERLING CAPITAL CORPORATION
INVESTMENTS IN SECURITIES - continued
As at June 30, 1996
(Unaudited)
Number of Market Value
Shares (Note A)
Consumer Goods - 1.16%
Kimberly Clark Corp. ....... 3,000 $231,750
Industrial Products - 1.09%
General Electric........... 2,500 $216,875
Automotive Products - 0.96%
Goodyear Tire & Rubber Co. ... 4,000 $192,000
Food Production - 0.96%
Archer-Daniels-Midland ...... 10,000 $191,250
Metals - 0.70%
Asarco, Inc................. 5,000 $138,750
Textiles and Apparel - 0.49%
Fieldcrest Cannon......... 5,000 $98,125
Miscellaneous Securities - 0.29%
Technology General Corp. * **. 292,600 $58,520
Total common and preferred stocks (cost $9,478,993) $12,038,831
________________
* Non-income producing security
** Investment in a company representing 5% or more of such
company's outstanding voting securities (such company is defined
as an "affiliated company" in Section 2(a)(2) of the Investment
Company Act of 1940, as amended). This investment was purchased
on February 7, 1969 at a cost of $266,000 and is valued at the
average of the bid and ask prices in the over-the-counter market
on June 30, 1996.
The accompanying notes are an integral part of these statements
<PAGE>
STERLING CAPITAL CORPORATION
INVESTMENTS IN SECURITIES - continued
As at June 30, 1996
(Unaudited)
Principal Market Value
Amount (Note A)
U.S. Government Obligations - 10.47%
U.S. Treasury Note 6.125% due 7/31/1996 ..... $250,000 $250,235
U.S. Treasury Note 6.25% due 8/31/1996 ...... 500,000 500,625
U.S. Treasury Note 6.5% due 9/30/1996 ...... 300,000 300,844
U.S. Treasury Note 7.5% due 12/31/1996 ....... 300,000 302,906
U.S. Treasury Note 5.125% due 2/28/1998...... 500,000 492,500
U.S. Treasury Note 5.5% due 2/28/1999 ....... 250,000 245,234
Total U.S. Government Obligations (cost $2,091,867) $2,092,344
Corporate Bonds and Notes - 7.32%
MCO Resources Inc. 7.375%
note due 8/1/1996 (1)................. $63,250 $44,275
ADT Operations Inc. 8.25% debenture due 8/1/2000. 150,000 154,406
Kroger Co. floating rate note
series B, due 12/15/2000 ........... 175,000 175,000
Stop and Shop Companies 9.75%
senior subordinated note due 2/1/2002 ... 150,000 163,500
Caesar's World 8.875% senior
subordinated note due 8/15/2002 ........ 200,000 210,000
World Color Press 9.125% senior
subordinated note due 3/15/2003 ...... 200,000 194,000
ADT Operations Inc. 9.25% senior
subordinated note due 8/1/2003 ....... 250,000 257,500
Kroger Co. 9.75% senior subordinated
debenture due 2/15/2004 ............. 250,000 262,500
Other................................ 160
Total corporate bonds and notes
(cost $1,402,988).................. $1,461,341
(1) Valued at fair value as determined by the Board of Directors
The accompanying notes are an integral part of these statements
STERLING CAPITAL CORPORATION
INVESTMENTS IN SECURITIES - continued
As at June 30, 1996
(Unaudited)
Principal Market Value
Amount (Note A)
Other Investments - 4.26%
Federal Home Loan Bank
Note 6.35% due 6/18/1999 ..... $250,000 $250,000
Federal Home Loan Mortgage Association
Note 7.395% due 6/27/2001 . 200,000 200,750
Federal National Mortgage Association
Note 7.5% due 6/3/2003 .... 200,000 198,188
Federal National Mortgage Association
Note 8% due 6/15/2006 ....... 200,000 202,188
Total Other Investments (cost $850,000) $851,126
Total Investments (cost $13,823,848) $16,443,642
The accompanying notes are an integral part of these statements
<PAGE>
STERLING CAPITAL CORPORATION
STATEMENT OF ASSETS AND LIABILITIES
As at June 30, 1996
(Unaudited)
ASSETS
Investment in securities, at value
(identified cost $13,823,,848) (Note A)................... $ 16,443,642
Cash...................................................... 17,479
Vista U.S. Government Money Market....................... 3,532,156
Investment in real estate (cost $100,000)................. 50,000
Receivables:
Dividends and interest.................................... 157,019
Other.................................................... 1,377
Deferred Pension Costs................................... 86,676
Total assets.............................................. $20,288,349
LIABILITIES
Payables:
Investment securities purchased....................... 200,164
Accrued expenses and other liabilities............... 110,342
Total liabilities......................................... $310,506
NET ASSETS
Common Stock, authorized 10,000,000 shares,
outstanding 2,500,000 shares, $1 par value each............ $2,500,000
Paid in capital............................................. 17,722,718
Excess of distributions over accumulated net investment loss (6,492,796)
Excess of net realized gain on investments over distributions 3,678,128
Unrealized appreciation of investments..................... 2,569,793
Net assets................................................. $19,977,843
Net assets per outstanding share........................ $7.99
The accompanying notes are an integral part of these statements
<PAGE>
STERLING CAPITAL CORPORATION
STATEMENT OF OPERATIONS
For the Six Months ended June 30, 1996
(Unaudited)
Investment income and expenses:
Interest........................................................ $164,446
Dividends...................................................... 317,277
Total income.................................................... 481,723
Reclassification (1).......................................... . (141,977)
Total income after reclassification ........................... $339,746
Expenses (Notes C, D and E):
Officers' salaries.......................................... . $ 72,188
Pension plan.................................................. 51,369
Office salaries............................................... 35,502
Payroll taxes, fees and employee benefits. ................... 23,850
Directors' fees and expenses.................................. 15,000
Equipment rentals............................................ 13,127
Rent and Electric........................................... 12,982
Legal, audit and professional fees......................... 9,750
Insurance...................................................... 8,079
American Stock Exchange listing fee.......................... 7,500
Custodian fees and expenses.................................. 6,656
Transfer agent and registrar fees............................ 6,089
Federal, state and local taxes............................... 5,264
Miscellaneous................................................ 1,652
Total expenses............................................ $269,008
Net investment income........................................ $70,738
(1) The Corporation received information from the issuer of one
of its portfolio holdings that certain amounts received in prior
periods and originally recorded as dividend income were, in
fact, a return of capital and are being reclassified that way.
(continued)
The accompanying notes are an integral part of these statements
STERLING CAPITAL CORPORATION
STATEMENT OF OPERATIONS-continued
For the year Six Months ended June 30, 1996
(Unaudited)
Net investment income (from previous page)............... $70,738
Net gain/(loss) on investments (Notes A and B):
Realized gain/(loss) from securities transactions:
Proceeds from sales.................................. $ 1,974,505
Cost of securities sold............................ 1,611,713
Net realized gain................................... .. $ 362,792
Unrealized appreciation of investments:
Beginning of period...................................... $ 1,755,049
End of period........................................... 2,569,793
Net increase in unrealized appreciation................ $ 814,744
Net realized and unrealized gain on investments.......... $ 1,177,536
Net increase in net assets resulting from operations..... $ 1,248,274
The accompanying notes are an integral part of these statements
<PAGE>
STERLING CAPITAL CORPORATION
STATEMENT OF CHANGES IN NET ASSETS
For the six months ended June 30, 1996 (unaudited)
and December 31, 1995
<TABLE>
Six months
ended Year ended
June 30 December 31,
1996 1995
<S> <C> <C>
From investment activities:
Net investment income............ $ 70,738 $ 334,614
Net realized gain from securities transactions . 362,792 1,420,414
Net change in unrealized appreciation ......... 814,744 1,482,410
Increase in net assets derived from
investment activities........................... 1,248,274 3,237,438
Distributions to shareholders (Note F) ......... 0 (1,695,000)
Net Assets:
Beginning of year............................. 18,729,569 17,187,131
End of period............................ $19,977,843 $18,729,569
</TABLE>
The accompanying notes are an integral part of these statements
STERLING CAPITAL CORPORATION
NOTES TO FINANCIAL STATEMENTS
As at June 30, 1996
(Unaudited)
Note A - Significant Accounting Policies
Sterling Capital Corporation (the "Corporation") (formerly
known as The Value Line Development Capital Corporation) is
registered under the Investment Company Act of 1940, as amended
(the "Act"), and is a diversified, closed-end investment
company. The Corporation operates exclusively as an internally
managed investment company whereby its own officers and
employees, under the general supervision of its Board of
Directors, conduct its operations. The following is a summary of
significant accounting policies consistently followed, in all
material respects, by the Corporation in the preparation of its
financial statements. The policies are in conformity with
generally accepted accounting principles.
(1) Security Valuation
Investments in securities traded on a national securities
exchange (or reported on the NASDAQ national market) are valued
at the last reported sales price on the day of valuation; other
securities traded in the over-the-counter market and listed
securities for which no sale was reported on that date are
valued at the last quoted bid price, except for short positions
and call options written, for which the last quoted asked price
is used. Investments in real estate are valued at fair value as
determined by the Board of Directors.
(2) Federal Income Taxes
The Corporation's policy is to comply with the requirements of
the Internal Revenue Code of 1986, as amended (the "Code") that
are applicable to regulated investment companies and to
distribute substantially all its taxable income to its
shareholders.
The Corporation for the fiscal year ending December 31, 1996
will probably be a "personal holding company" under the Code,
since five or fewer shareholders own directly or indirectly more
than 50% in value of the Corporation's outstanding stock, and
more than 60% of the Corporation's adjusted ordinary income will
probably be "personal holding company income". As a personal
holding company, the Corporation will be subject to penalty
taxes unless it distributes to its shareholders an amount at
least equal to its otherwise undistributed personal holding
company income, net of appropriate deductions applicable
thereto. It is anticipated that the Corporation will not have
any undistributed personal holding company income for the year
ended December 31, 1996. Personal holding company income does
not include the excess, if any, of net realized long-term
capital gains over net realized short-term capital losses, less
any Federal income tax attributable to such excess. The
Corporation has considered methods of minimizing the possible
tax impact of being a personal holding company, and if
appropriate, will make sufficient distributions to shareholders
so that the Corporation will not be subject to such penalty tax.
<PAGE>
(3) Securities Transactions
Securities transactions are accounted for on the date the
securities are purchased or sold (trade date), dividend income
is recorded on the ex-dividend date and interest income is
accrued as earned. Gains and losses from securities transactions
were computed on the identified cost basis.
(4) Distributions to Shareholders
Dividends to shareholders are recorded on the ex-dividend date.
Note B - Securities Transactions
The following summarizes all securities transactions by the
Corporation for the six months ended
June 30, 1996:
Purchases (includes $9,000,000 of short term corporate
commercial paper) ........ $13,214,108
Sales (includes $10,500,000 of short term corporate commercial
paper) ............. $13,106,464
Net gain on investments for the six months ended June 30, 1996
was $1,177,536. This amount represents the net increase in value
of investments held during the period. The components are as
follows:
Long transactions ............................ $1,177,536
Net gain on investments ................... $1,177,536
Gross unrealized gains and losses in the Corporation's
portfolio of investments amounted to $2,997,747 and $427,954,
respectively, as at June 30, 1996.
Note C - Rent
The Corporation sublets a portion of office space at 635
Madison Avenue, New York, NY, from Windy Gates Corporation
("Windy Gates"), a corporation controlled by Walter Scheuer, the
Chairman of the Board of Directors and principal shareholder of
the Corporation. The term of the Windy Gates lease expires on
June 30, 2004. The term of the sublease to the Corporation
expires on June 30, 2004. The annual rental obligation of these
premises is being allocated between the Corporation and Windy
Gates on the basis of each such party's use of this space. The
Corporation's current net annual expense for this space is
approximately $25,000.<PAGE>
Note D - Other Transactions with Affiliates
Aggregate remuneration paid or accrued by the Corporation for
the six months ended June 30, 1996 to certain persons who were
"affiliated persons" within the meaning of the Act, was as
follows:
Officers' salaries................................ $ 72,188
Amount paid or accrued under Pension Plan ....... 51,369
Directors' fees................................. 15,000
Incident to the sublease arrangements for office space at 635
Madison Avenue referred to in Note C above, Mr. Scheuer and the
Corporation, have allocated certain of the expenses incurred in
connection with each of such party's use of various services
located thereat, including office equipment and secretarial,
administrative and internal accounting personnel. For the six
months ended June 30, 1996, Mr. Scheuer and the Corporation paid
or accrued approximately $220,000 and $50,000, respectively, in
connection with the allocation of expenses incurred with respect
to the use of such services. In addition, during the period
certain persons who are also officers of the Corporation
rendered services to Mr. Scheuer personally for which they
received compensation from Mr. Scheuer.
Note E - Pension Plan
The Corporation has a defined benefit pension plan covering
substantially all of its employees', other than Union employees
and part-time employees. The benefits are based on years of
service and the employee's compensation. The Corporation's
funding policy is to contribute annually the maximum amount that
can be deducted for Federal income tax purposes. Contributions
are intended to provide not only for benefits attributed to
service to date but also for those expected to be earned in the
future.
The following table sets forth the plan's funded status and
amounts recognized in the Corporation's statement of assets and
liabilities at December 31, 1995:
Actuarial present value of benefit obligations:
Accumulated benefit obligations, including
vested benefits of $245,307............................. ($245,968)
Projected benefit obligation for service rendered to date (409,112)
Plan assets at fair value................................ 211,559
Projected benefit obligation in excess of plan assets.... (197,553)
Prior service costs..................................... 47,034
Unrecognized net loss from past experience different from
that assumed and effect of changes in assumptions .... 87,424
Unrecognized net transition obligation at January 1, 1995,
being recognized over 25 years........................ 115,362
Accrued pension expense................................. 34,409
Prepaid pension cost included in other assets........... 86,676
Net pension cost for 1995 included the following components:
Service cost - benefits earned during the period............. $52,733
Interest cost on projected benefit obligation............... 28,734
Actual return on plan assets................................ (23,885)
Net amortization and deferral............................... 27,512
Net periodic pension cost ................................... $85,094
The weighted average discount rate and rate of increase in
future compensation levels used in determining the actuarial
present value of the projected benefit obligation were 6.0% and
3.0% respectively. The expected long-term rate of return on
assets was 8.0%.
Note F- Distributions to Shareholders
On January 18, 1996 the Corporation paid a cash distribution of
$.65 per share to shareholders of record at the close of
business on December 26, 1995. The Corporation believes that
the entire amount of the distribution should be treated as a
distribution of net capital gains and "investment company
taxable income" to shareholders and for Federal income tax
purposes was taxable to calendar year shareholders in 1995 even
though the distribution was paid to shareholders in 1996. The
Board of Directors determined that of the aggregate amount of
the distribution ($1,625,000), $300,000 be considered a charge
on the Corporation's books against net investment income and
$1,325,000 be considered a charge on the Corporation's books
against net realized gains. Detailed information with respect to
the distribution has been provided to each shareholder.
On July 22, 1996 the Board of Directors of the Corporation
declared a cash distribution of $.052 per share, payable
September 3, 1996 to shareholders of record at the close of
business on August 8, 1996. The entire amount of the
distribution represents a distribution of net capital gains and
"investment company taxable income" to shareholders realized by
the Corporation during 1995 that was not previously distributed
to shareholders. The Corporation believes that the entire amount
of the distribution should be treated as a distribution of net
capital gains and "investment company taxable income" to
shareholders and for Federal income tax purposes is taxable to
such calendar year shareholders in 1996 even though the
distribution represents net capital gains and "investment
company taxable income" realized by the Corporation during 1995.
The Board of Directors determined that of the aggregate amount
of the distribution ($130,000), $34,600 be considered a charge
on the Corporation's books against net investment income and
$95,400 be considered a charge on the Corporation's books
against net realized gains. Detailed information with respect to
the distribution has been provided to each shareholder.
STERLING CAPITAL CORPORATION
SUPPLEMENTARY INFORMATION
As at June 30, 1996
Selected data for each share of capital stock outstanding
throughout each period:
<TABLE>
Six Months
ended Year Ended December 31
June 30, 1996 1995 1994 1993 1992 1991
(Unaudited)(1) (Audited)
<S> <C> <C> <C> <C> <C> <C>
Investment income .... $.14 $.39 $.38 $.36 $.35 $.34
Expenses ........... .11 .25 .28 24 .31 .36
Net investment income (loss) .03 .14 .10 .12 .04 (.02)
Distributions of net realizedcapital gains ..
- (.53) - (.67) (.96) (1.23)
Distributions of net investment income
- (.15) (.08) (.15) - -
Net realized gain (loss) and increase
(decrease) in unrealized appreciation..
.47 1.16 (.68) 1.08 .72 1.67
Net increase (decrease) in net asset value
.50 .62 (.66) .38 (.20) .42
Net asset value:
Beginning of period ..... 7.49 6.87 7.53 7.15 7.35 6.93
End of period ......... $7.99 $7.49 $6.87 $7.53 $7.15 $ 7.35
Ratio of expenses to average net assets
1.4% 3.4% 3.8% 3.1% 4.0% 4.7%
Ratio of net investment income (loss) to
average net assets .. .... .4% 1.8% 1.3% 1.6% .6% (.3%)
Portfolio turnover (1) ... 17% 51% 77% 95% 99% 110%
Number of shares outstanding at end
of each period (in 000's) 2,500 2,500 2,500 2,500 2,500 2,500
</TABLE>
(1) Not annualized
(2) The portfolio turnover for December 31, 1991 has been
restated to give effect, in the calculation, to the exclusion of
certain investments expiring in less than one year from the date
of purchase.
<PAGE>
