<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 2000
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________ to ___________
Commission file number: 000-15760
HARDINGE INC.
(Exact name of Registrant as specified in its charter)
New York 16-0470200
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Hardinge Inc.
One Hardinge Drive
Elmira, NY 14902
(Address of principal executive offices) (Zip code)
(607) 734-2281
(Registrant's telephone number including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/ No / /
As of June 30, 2000 there were 8,886,871 shares of Common Stock of the
Registrant outstanding.
1
<PAGE>
HARDINGE INC. AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
<S> <C>
Part I Financial Information Page
Item 1. Financial Statements
Consolidated Balance Sheets at June 30, 2000 and
December 31, 1999. 3
Consolidated Statements of Income and Retained Earnings
for the three months ended June 30, 2000 and 1999 and
the six months ended June 30, 2000 and 1999. 5
Condensed Consolidated Statements of Cash Flows for
the six months ended June 30, 2000 and 1999. 6
Notes to Consolidated Financial Statements. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. 9
Item 3. Quantitative and Qualitative Disclosures About
Market Risks 12
Part II Other Information
Item 1. Legal Proceedings 13
Item 2. Changes in Securities 13
Item 3. Default upon Senior Securities 13
Item 4. Submission of Matters to a Vote of Security Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
Signatures 14
</TABLE>
2
<PAGE>
PART I, ITEM 1
HARDINGE INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
June 30, Dec. 31,
2000 1999
-------------------------
(Unaudited)
Assets
Current assets:
Cash $ 1,232 $ 1,156
Accounts receivable 41,872 46,218
Notes receivable 7,719 7,594
Inventories 87,070 85,640
Deferred income taxes 4,207 4,207
Prepaid expenses 4,436 3,367
-------------------------
Total current assets 146,536 148,182
Property, plant and equipment:
Property, plant and equipment 145,238 144,421
Less accumulated depreciation 76,021 72,156
-------------------------
69,217 72,265
Other assets:
Notes receivable 17,021 15,014
Goodwill 3,722 3,794
Other 3,255 2,202
-------------------------
23,998 21,010
-------------------------
Total assets $239,751 $241,457
=========================
See accompanying notes.
3
<PAGE>
HARDINGE INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS--CONTINUED
(IN THOUSANDS)
June 30, Dec. 31,
2000 1999
-------------------------
(Unaudited)
Liabilities and shareholders' equity
Current liabilities:
Accounts payable $ 9,997 $ 14,460
Notes payable to bank 2,777 663
Accrued expenses 15,003 9,292
Accrued income taxes 1,217 2,667
Deferred income taxes 2,414 2,122
Current portion long-term debt 3,550 3,550
------------------------
Total current liabilities 34,958 32,754
Other liabilities:
Long-term debt 21,907 23,380
Accrued pension plan expense 4,971 4,971
Deferred income taxes 2,076 2,055
Accrued postretirement benefits 5,677 5,620
------------------------
34,631 36,026
Equity of minority interest 976 963
Shareholders' equity:
Preferred stock, Series A, par value $.01:
Authorized - 2,000,000; issued - none
Common stock, $.01 par value:
Authorized shares - 20,000,000
Issued shares - 9,919,992 at June 30, 2000
and December 31, 1999 99 99
Additional paid-in capital 61,583 61,760
Retained earnings 129,964 128,325
Treasury shares (13,921) (10,199)
Accumulated other comprehensive income -
Foreign currency translation adjustments (4,892) (4,143)
Deferred employee benefits (3,647) (4,128)
------------------------
Total shareholders' equity 169,186 171,714
------------------------
Total liabilities and shareholders' equity $ 239,751 $ 241,457
========================
See accompanying notes.
4
<PAGE>
HARDINGE INC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
2000 1999 2000 1999
------------------------ ------------------------
<S> <C> <C> <C> <C>
Net Sales $ 47,773 $ 45,881 $ 95,609 $ 92,075
Cost of sales 31,977 31,500 64,111 62,146
------------------------ ------------------------
Gross profit 15,796 14,381 31,498 29,929
Selling, general and
administrative expenses 12,110 12,035 24,031 24,168
------------------------ ------------------------
Income from operations 3,686 2,346 7,467 5,761
Interest expense 625 476 979 965
Interest (income) (108) (117) (219) (274)
Income before income taxes and minority
interest in consolidated subsidiary ------------------------ ------------------------
3,169 1,987 6,707 5,070
Income taxes 1,098 675 2,549 1,714
Minority interest in (profit) loss of
consolidated subsidiary (88) 146 (13) 184
------------------------ ------------------------
Net income 1,983 1,458 4,145 3,540
Retained earnings at beginning of period 129,224 128,230 128,325 127,526
Less dividends declared 1,243 1,351 2,506 2,729
------------------------ ------------------------
Retained earnings at end of period $ 129,964 $ 128,337 $ 129,964 $ 128,337
======================== ========================
Per share data:
Basic earnings per share $ .23 $ .16 $ .47 $ .38
======================== ========================
Weighted average number
of common shares outstanding 8,680 9,338 8,788 9,409
======================== ========================
Diluted earnings per share $ .23 $ .16 $ .47 $ .38
======================== ========================
Weighted average number
of common shares outstanding 8,680 9,342 8,825 9,409
======================== ========================
Cash Dividends Declared $ .14 $ .14 $ .28 $ .28
======================== ========================
</TABLE>
See accompanying notes.
5
<PAGE>
HARDINGE INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
2000 1999
-----------------------
<S> <C> <C>
Net cash provided by operating activities $ 8,542 $ 24,093
Investing activities:
Capital expenditures (1,429) (3,626)
Investment in Hardinge EMAG (1,397)
----------------------
Net cash (used in) investing activities (2,826) (3,626)
Financing activities:
Increase (decrease) in short-term notes payable to bank 2,123 (2,662)
(Decrease) in long-term debt (1,001) (13,419)
(Purchase) of treasury stock (4,215) (3,319)
Dividends paid (2,506) (2,729)
Funds provided by minority intertest 13
----------------------
Net cash (used in) financing activities (5,586) (22,129)
Effect of exchange rate changes on cash (54) (68)
----------------------
Net increase (decrease) in cash $ 76 ($ 1,730)
======================
</TABLE>
See accompanying notes.
6
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
JUNE 30, 2000
NOTE A--BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three and six month periods ended June
30, 2000, are not necessarily indicative of the results that may be expected for
the year ended December 31, 2000. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Company's annual report for the year ended December 31, 1999.
The Company has adopted Statement of Financial Accounting Standards No.
131, "Disclosures About Segments of an Enterprise and Related Information." The
Company operates in only one business segment - industrial machine tools.
NOTE B--INVENTORIES
Inventories are summarized as follows (dollars in thousands):
June 30, December 31,
2000 1999
-----------------------------
Finished products $ 35,510 $ 37,361
Work-in-process 29,891 25,572
Raw materials and purchased components 21,669 22,707
--------- --------
$ 87,070 $ 85,640
========= ========
NOTE C--COMPANY STOCK REPURCHASE PROGRAM
On April 9, 1999 Hardinge announced a stock repurchase program. The Board
of Directors authorized the repurchase of up to 1.0 million shares of the
Company's common stock, or approximately 10% of the total shares outstanding.
The Company has purchased 900,351 shares under the program as of June 30, 2000.
On July 26, 2000, Hardinge announced that its Board of Directors had expanded
the Company's stock buyback program by authorizing a plan to repurchase up to an
additional one million shares of stock.
7
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 2000
NOTE D--EARNINGS PER SHARE AND WEIGHTED AVERAGE SHARES OUTSTANDING
Earnings per share are computed in accordance with Statement of Financial
Accounting Standards No. 128 "Earnings per Share." Basic earnings per share are
computed using the weighted average number of shares of common stock outstanding
during the period. For diluted earnings per share, the weighted average number
of shares includes common stock equivalents related primarily to restricted
stock.
The following is a reconciliation of the numerators and denominators of
the basic and diluted earnings per share computations required by Statement No.
128. The table sets forth the computation of basic and diluted earnings per
share:
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
-------------------- --------------------
2000 1999 2000 1999
-------------------- --------------------
<S> <C> <C> <C> <C>
Numerator:
Net income $1,983 $1,458 $4,145 $3,540
Numerator for basic earnings per share 1,983 1,458 4,145 3,540
Numerator for diluted earnings per share 1,983 1,458 4,145 3,540
Denominator:
Denominator for basic earnings per share
-weighted average shares 8,680 9,338 8,788 9,409
Effect of diluted securities:
Restricted stock and stock options 4 37
Denominator for diluted earnings per share
-adjusted weighted average shares 8,680 9,342 8,825 9,409
Basic earnings per share $ .23 $ .16 $ .47 $ .38
==================== ====================
Diluted earnings per share $ .23 $ .16 $ .47 $ .38
==================== ====================
</TABLE>
8
<PAGE>
PART I, ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following are management's comments relating to significant changes in
the results of operations for the three and six month periods ended June 30,
2000 and 1999 and in the Company's financial condition during the six month
period ended June 30, 2000.
RESULTS OF OPERATIONS
NET SALES. Net sales for the quarter ended June 30, 2000 were $47,773,000
compared to $45,881,000 for the second quarter of 1999, an increase of
$1,892,000, or 4.1%. Year to date sales for the first six months of 2000 totaled
$95,609,000 compared to $92,075,000 a year earlier, for an increase of
$3,534,000, or 3.8%. Sales increased in the U.S. market by $2,220,000 or 7.7%,
and $5,578,000 or 9.6%, respectively, for the quarter and six month periods
ended June 30, 2000 compared to 1999. U.S.sales during the second quarter and
first six months of 2000 included billings of $2,835,000 and $9,864,000 to a
single customer for partial completion of a large order entered during the
second quarter of 1999. Sales to European customers declined by $1,901,000 or
16.1% and $5,415,000 or 21.2% for the quarter and six month periods ended June
30, 2000 compared to the same 1999 periods. On the other hand, sales to all
other areas of the world increased by $1,573,000 or 30.9% and $3,371,000 or
41.1% for the same periods, fueled primarily by increased sales to customers in
China and Canada.
The composition of sales was relatively consistent during all periods.
Machine sales accounted for 63.9% for both the three and six month periods ended
June 30, 2000 compared to 63.4% and 62.6% for the corresponding periods last
year, with sales on non-machine products and services making up the balance.
The Company's order rate for the quarter ended June 30, 2000 increased by
2% over the same quarter last year after removing the large order mentioned
above from the 1999 quarter. Likewise, backlog of $37,250,000 at June 30, 2000
was 6% higher than a year earlier after making the same adjustment.
GROSS PROFIT. Gross margin improved during both the second quarter and six
months ended June 30, 2000 compared to the same 1999 periods. Expressed as a
percentage of sales, gross margin for the quarter ended June 30, 2000 was 33.1%
compared to 31.3% a year earlier. For the six months ended June 30, 2000, gross
margin was 32.9% compared to 32.5% a year earlier. The 2000 margin improvement
was partially the result of cost containment efforts at the U.S. manufacturing
facility. Additionally, the relatively smaller portion of sales going to
customers outside the United States brought further improvement in gross margin
since typically higher distribution discounts are associated with those sales.
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative ("SG&A") expenses were $12,110,000, or 25.3% of sales, during the
second quarter of 2000 compared to $12,035,000, or 26.2% a year earlier. SG&A
expenses for the six months ended June 30, 2000 and 1999 were $24,031,000 and
$24,168,000, or 25.1% and 26.2% of sales, respectively. Significant expense
reduction efforts over the past eighteen months have resulted in SG&A expenses
being held at consistent levels, even with the volume increases the Company has
experienced during the first two quarters of the current year. The low spending
levels in 2000 are especially noteworthy considering the Company made a
significant increase in promotional spending attributable to the upcoming
International Manufacturing Technology Show (IMTS) in September. This
exhibition, held every two years, is a premier event for the machine tool
industry.
9
<PAGE>
INCOME FROM OPERATIONS. Income from operations as a percentage of net
sales increased for the three months ended June 30, 2000 to 7.7%, from 5.1% a
year earlier. Income from operations for the first six months of 2000 increased
to 7.8% of sales compared to 6.3% for the same period of 1999. These
improvements are the result of improved gross margin coupled with reduced SG&A
expenses as a percentage of sales.
INTEREST EXPENSE AND INCOME. Interest expense for the quarter ended June
30, 2000 was $625,000 compared to $476,000 a year earlier. While average
outstanding borrowings were nearly equal during both periods, the average
borrowing rate during 2000's second quarter was nearly 1.5% higher than the
second quarter of 1999. Interest expense for the six month periods ended June
30, 2000 and 1999 was $979,000 and $965,000, respectively, reflecting somewhat
lower average outstanding borrowings offset by higher interest rates. Interest
income was slightly lower for the quarter and six months ended June 30, 2000
compared to a year earlier.
INCOME TAXES. The provision for income taxes as a percentage of pre-tax
income was 34.6% for the quarter ended June 30, 2000 compared to 34.0% for the
second quarter of 1999. For the first six months of 2000, the tax rate was 38.0%
compared to 33.8% for 1999's first half. The six month tax rate for 1999 was
lower than in 2000 as the result of 1999's first quarter having benefited from a
high utilization of U.S. income tax credits which did not repeat in 2000's first
quarter. Additionally, consolidated income was reduced in 2000's first quarter
by foreign losses against which no income taxes were recoverable resulting in a
slight increase in the consolidated rate.
NET INCOME. Net income for the second quarter of 2000 was $1,983,000, or
$.23 per share, compared to $1,458,000, or $.16 per share, for the second
quarter of 1999. Year to date 2000 net income was $4,145,000, or $.47 per share,
compared to $3,540,000, or $.38 per share for the same 1999 period. The
improvement in earnings was the result of all the factors discussed above.
EARNINGS PER SHARE. All earnings per share and weighted average share
amounts are computed in accordance with Financial Accounting Standards Board
Statement No. 128, EARNINGS PER SHARE.
10
<PAGE>
QUARTERLY INFORMATION
The following table sets forth certain quarterly financial data for each
of the periods indicated.
<TABLE>
<CAPTION>
Three Months Ended
Mar. 31, June 30, Sept. 30, Dec. 31,
2000 2000 2000 2000
----------------------------------------------------------
(in thousands, except per share data)
----------------------------------------------------------
<S> <C> <C> <C> <C>
Net Sales $47,836 $47,773
Gross Profit 15,702 15,796
Income from operations 3,781 3,686
Net income 2,162 1,983
Diluted earnings per share .24 .23
Weighted average shares outstanding 8,934 8,680
Three Months Ended
Mar. 31, June 30, Sept. 30, Dec. 31,
1999 1999 1999 1999
----------------------------------------------------------
(in thousands, except per share data)
----------------------------------------------------------
Net Sales $46,194 $45,881 $42,399 $44,059
Gross Profit 15,548 14,381 13,418 13,811
Income from operations 3,415 2,346 1,468 2,388
Net income 2,082 1,458 980 1,521
Diluted earnings per share .22 .16 .11 .17
Weighted average shares outstanding 9,431 9,342 9,265 9,035
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES
Operating activities for the first six months of 2000 generated
$8,542,000, compared to generating $24,093,000 for the same period of 1999, for
a net reduction in cash generation of $15,551,000. The improving business
conditions during the first half of 2000 required a modest increase of
$1,746,000 in inventory, compared to a large reduction of $5,194,000 in
inventory for the same period of 1999 when business was declining significantly.
The net result of these changes between the two periods was a use of $6,940,000
in operating cash. Likewise, while accounts receivable were still declining
during the first half of 2000, the rate of decline was much slower than for the
first half of 1999, at $3,768,000 compared to $8,770,000, requiring net usage of
an additional $5,002,000 of cash. The remaining $3,609,000 of the net reduction
in cash generation was the result of numerous smaller changes in operating
activities.
Investing activities for the first six months of 2000 used cash totaling
$2,826,000 compared to $3,626,000 for the same period of 1999. Financing
activities used additional cash of $5,586,000 in the first half of 2000,
compared to using $22,129,000 for the same 1999 period. The large change in
financing activities was primarily the result of significant reductions in both
short and long-term debt totaling $16,081,000 during the first half of 1999 as
the need for working capital diminished. During the first half of 2000, a small
net increase in total debt provided $1,122,000 cash.
Hardinge's current ratio at June 30, 2000 was 4.19:1 compared to 4.52:1 at
December 31, 1999. The reduction was due primarily to reduced accounts
receivable.
11
<PAGE>
Hardinge provides long-term financing for the purchase of its equipment by
qualified customers. We periodically sell portfolios of our customer notes to
financial institutions in order to reduce debt and finance current operations.
Our customer financing program has an impact on our month-to-month borrowings,
but it has had little long-term impact on our working capital because of the
ability to sell the underlying notes. We sold $11,341,000 of customer notes in
the first half of 2000, compared to $8,766,000 during the same period of 1999.
At June 30, 2000 Hardinge maintained revolving loan agreements with
several U.S. banks providing for unsecured borrowing up to $50,000,000 on a
revolving basis through August 1, 2002. These facilities, along with other short
term credit agreements, provide for immediate access of up to $64,000,000. At
June 30, 2000, outstanding borrowings under these arrangements totaled
$18,470,000.
We believe that the currently available funds and credit facilities, along
with internally generated funds, will provide sufficient financial resources for
ongoing operations.
SUBSEQUENT EVENT
On July 26, 2000, Hardinge announced that its Board of Directors had
expanded the Company's stock buyback program by authorizing a plan to repurchase
up to an additional one million shares of stock. Current report on Form 8-K was
filed with the Securities & Exchange Commission on August 3, 2000.
THIS REPORT CONTAINS STATEMENTS OF A FORWARD-LOOKING NATURE RELATING TO
THE FINANCIAL PERFORMANCE OF HARDINGE INC. SUCH STATEMENTS ARE BASED UPON
INFORMATION KNOWN TO MANAGEMENT AT THIS TIME. THE COMPANY CAUTIONS THAT SUCH
STATEMENTS NECESSARILY INVOLVE UNCERTAINTIES AND RISK AND DEAL WITH MATTERS
BEYOND THE COMPANY'S ABILITY TO CONTROL, AND IN MANY CASES THE COMPANY CANNOT
PREDICT WHAT FACTORS WOULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE
INDICATED. AMONG THE MANY FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER FROM
THOSE SET FORTH IN THE FORWARD-LOOKING STATEMENTS ARE FLUCTUATIONS IN THE
MACHINE TOOL BUSINESS CYCLES, CHANGES IN GENERAL ECONOMIC CONDITIONS IN THE U.S.
OR INTERNATIONALLY, THE MIX OF PRODUCTS SOLD AND THE PROFIT MARGINS THEREON, THE
RELATIVE SUCCESS OF THE COMPANY'S ENTRY INTO NEW PRODUCT AND GEOGRAPHIC MARKET ,
THE COMPANY'S ABILITY TO MANAGE ITS OPERATING COSTS, ACTIONS TAKEN BY CUSTOMERS
SUCH AS ORDER CANCELLATIONS OR REDUCED BOOKINGS BY CUSTOMERS OR DISTRIBUTORS,
COMPETITORS' ACTIONS SUCH AS PRICE DISCOUNTING OR NEW PRODUCT INTRODUCTIONS,
GOVERNMENTAL REGULATIONS AND ENVIRONMENTAL MATTERS, CHANGES IN THE AVAILABILITY
AND COST OF MATERIALS AND SUPPLIES, THE IMPLEMENTATION OF NEW TECHNOLOGIES AND
CURRENCY FLUCTUATIONS. ANY FORWARD-LOOKING STATEMENT SHOULD BE CONSIDERED IN
LIGHT OF THESE FACTORS. THE COMPANY UNDERTAKES NO OBLIGATION TO REVISE ITS
FORWARD-LOOKING STATEMENTS IF UNANTICIPATED EVENTS ALTER THEIR ACCURACY.
PART I. ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
None
12
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULT UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The 2000 Annual Meeting of Shareholders of Hardinge Inc. was held on April
25, 2000. A total of 7,958,298 of the Company's shares were present or
represented by proxy at the meeting. This represents approximately 88% of the
Company's shares outstanding.
The two Class III directors named below were elected to serve a three-year
term.
Class III Directors Votes for Votes Withheld
--------- --------------
James L. Flynn 7,924,528 33,770
Douglas A. Greenlee 7,924,245 34,053
Robert E. Agan, Daniel J. Burke, Richard J. Cole, E. Martin Gibson , J.
Philip Hunter and Albert W. Moore continue as Directors of the Company.
The election of Ernst & Young LLP as the Company's independent accountants
for the year 2000 was ratified, with 7,918,261 shares voting for and 26,128
shares voting against.
No other matters were presented for vote at that meeting.
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits
27. Financial Data Schedule
B. Reports on Form 8-K
None
13
<PAGE>
SIGNATURES
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.
HARDINGE INC.
AUGUST 10, 2000 By: /s/ Robert E. Agan
--------------- --------------------------------------
Date Robert E. Agan
Chairman of the Board/CEO
AUGUST 10, 2000 By: /s/ J. Patrick Ervin
--------------- --------------------------------------
Date J. Patrick Ervin
President/COO
AUGUST 10, 2000 By: /s/ Richard L. Simons
--------------- --------------------------------------
Date Richard L. Simons
Executive Vice President/CFO
(Principal Financial Officer)
14
