UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 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
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Commission File Number: 0-1665
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DCAP GROUP, INC.
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(Exact name of small business issuer as specified in its charter)
Delaware 36-2476480
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(State or other jurisdiction of (I.R.S Employer Identification No.)
incorporation or organization)
90 Merrick Avenue, East Meadow, New York 11554
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(Address of principal executive offices) (Zip Code)
(516) 794-6300
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(Registrant's telephone number, including area code)
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(Former name, former address and former fiscal year,
if changed since last report)
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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. ( )Yes ( ) No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date: 15,068,018 shares as of
October 18, 2000
<PAGE>
INDEX
DCAP GROUP, INC. AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheet - September 30, 2000 (Unaudited)
Condensed Consolidated Statements of Operations - Nine months
ended September 30, 2000 and 1999 (Unaudited)
Condensed Consolidated Statements of Operations - Three months
ended September 30, 2000 and 1999 (Unaudited)
Condensed Consolidated Statements of Cash Flows - Nine months
ended September 30, 2000 and 1999 (Unaudited)
Notes to Condensed Consolidated Financial Statements - Nine
months ended September 30, 2000 and 1999 (Unaudited)
Item 2. Management's Discussion and Analysis or Plan of Operation
PART II.OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
DCAP GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
September 30, 2000
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 879,704
Accounts receivable 552,188
Prepaid expenses and
other current assets 364,163
----------
Total current assets 1,796,055
----------
PROPERTY AND EQUIPMENT, net 1,153,599
----------
OTHER ASSETS:
Receivable from stockholders 225,000
Goodwill, net 3,105,701
Other intangibles, net 490,256
Deposits and other assets 612,417
----------
Total other assets 4,433,374
----------
$7,383,028
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $1,778,331
Current portion of long-term debt 76,000
Current portion of capital lease obligations 233,582
Debentures payable 154,200
----------
Total current liabilities 2,242,113
----------
OTHER LIABILITIES:
Long-term debt 240,162
Capital lease obligations 204,620
Deferred revenue 93,320
----------
Total other liabilities 538,102
----------
MINORITY INTEREST 37,141
----------
STOCKHOLDERS' EQUITY:
Common Stock, $.01 par value; authorized,
25,000,000 shares; issued and outstanding,
15,068,018 shares 150,680
Capital in excess of par 9,744,909
Deficit (5,101,917)
----------
4,793,672
Subscription receivable (228,000)
----------
$4,565,672
==========
$7,383,028
==========
See notes to condensed consolidated financial statements.
3
<PAGE>
DCAP GROUP INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Nine months ended
September 30,
2000 1999
---------- ----------
Revenues:
Commissions and fees $5,714,330 $5,185,085
Rooms 739,043 740,462
Other 33,801 33,821
Interest 39,819 41,924
---------- ----------
Total revenues 6,526,993 6,001,292
---------- ----------
Costs and expenses:
General, administrative
and sundry 5,858,571 5,304,058
Departmental 218,026 220,670
Depreciation and amortization 618,044 471,794
Lease rentals 149,463 148,981
Property operation
and maintenance 21,441 19,726
---------- ----------
6,865,545 6,165,229
Operating loss before income taxes,
minority interest, and other expenses (338,552) (163,937)
Interest expense 92,752 145,830
Loss on sale of ownership interests in
joint venture 75,822 -
---------- ----------
Loss before income taxes
and minority interest (507,126) (309,767)
Provision for income taxes 24,523 22,957
---------- ----------
Loss before minority interest (531,649) (332,724)
Minority interest 6,000 63,760
---------- ----------
Net loss $ (537,649) $ (396,484)
========== ==========
Net loss per common share:
Basic $ (.04) $ (.04)
========== ===========
Diluted $ (.04) $ (.04)
========== ===========
Weighted average number of shares outstanding:
Basic 14,646,909 11,225,865
========== ==========
Diluted 14,646,909 11,225,865
========== ==========
See notes to condensed consolidated financial statements.
4
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DCAP GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three months ended
September 30,
2000 1999
---------- -----------
Revenues:
Commissions and fees $1,717,813 $2,174,404
Rooms 220,816 216,301
Other 5,392 18,658
Interest 11,102 14,798
---------- ----------
Total revenues 1,955,123 2,424,161
---------- ----------
Costs and expenses:
General and administrative 1,973,312 2,284,169
Departmental 23,288 73,855
Depreciation and amortization 191,549 232,893
Lease rentals 44,523 43,337
Property operation
and maintenance 5,016 6,560
---------- ----------
2,237,688 2,640,814
---------- ----------
Operating loss before income taxes,
minority interest, and other expenses (282,565) (216,653)
Interest expense 27,993 75,372
---------- ----------
Loss before income taxes
and minority interest (310,558) (292,025)
Provision for income taxes 14,973 668
---------- ----------
Loss before minority interest (325,531) (292,693)
Minority interest (219) 7,000
---------- ----------
Net loss $ (325,312) $ (299,693)
=========== ==========
Net loss per common share:
Basic $ (.02) $ (.03)
========== ==========
Diluted $ (.02) $ (.03)
========== ==========
Weighted average number of shares outstanding:
Basic 15,068,018 13,452,944
========== ==========
Diluted 15,068,018 13,452,944
========== ==========
See notes to condensed consolidated financial statements.
5
<PAGE>
DCAP GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine months ended
September 30,
2000 1999
--------- ----------
Cash flows from operating activities:
Net loss $(537,649) $ (396,484)
Adjustments to reconcile net (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization 618,044 471,794
Provision for bad debts 1,800 1,800
Minority interest in net earnings 6,000 63,760
Loss on sale of ownership interests in
joint venture 75,822 -0-
Decrease (increase) in assets:
Accounts receivable (24,002) (182,777)
Prepaid expenses and other
current assets (29,103) 113,251
Deposits and other 64,687 -0-
Increase (decrease) in liabilities:
Accounts payable and accrued expenses 355,633 (87,025)
Deferred revenue (27,467) (33,635)
--------- ----------
Net cash provided by (used in)
operating activities 503,765 (49,316)
Cash flows from investing activities:
Increase in notes and
other receivables (275,214) (1,258,038)
Acquisition of property and equipment (75,261) (202,275)
--------- ----------
Net cash (used in)
investing activities (350,475) (1,460,313)
Cash flows from financing activities:
Proceeds from issuance of stock -0- 2,342,565
Proceeds from issuance of long-term debt 41,000 21,000
Principal payment of long term
debt and capital lease obligation (257,762) -0-
--------- ----------
Net cash provided by
(used in) financing activities (216,762) 2,363,565
Net increase (decrease) in cash and
cash equivalents (63,472) 853,936
Cash and cash equivalents,
beginning of period 943,176 353,431
--------- ----------
Cash and cash equivalents,
end of period $ 879,704 $1,207,367
========= ==========
See notes to condensed consolidated financial statements.
6
<PAGE>
DCAP GROUP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999 (UNAUDITED)
1. The Condensed Consolidated Balance Sheet as of September 30, 2000, the
Condensed Consolidated Statements of Operations for the three and nine
months ended September 30, 2000 and 1999 and the Condensed Consolidated
Statements of Cash Flows for the nine months ended September 30, 2000 and
1999 have been prepared by the Company without audit. In the opinion of the
Company, the accompanying unaudited condensed consolidated financial
statements contain all adjustments necessary to present fairly its
financial position as of September 30, 2000, results of operations for the
three and nine months ended September 30, 2000 and 1999 and cash flows for
the nine months ended September 30, 2000 and 1999. This report should be
read in conjunction with the Company's Annual Report on Form 10-KSB for the
year ended December 31, 1999.
2. Summary of Significant Accounting Policies:
------------------------------------------
a. Principles of consolidation
The accompanying consolidated financial statements include the accounts of
all subsidiaries in which the Company exercises significant influence over
all decision making related to the ongoing major operations. All
significant intercompany accounts and transactions have been eliminated.
b. Revenue recognition
The Company recognizes commission revenue from insurance policies at the
beginning of the contract period, on income tax preparation when the
services are completed and on automobile club dues equally over the
contract period. Franchise fee revenue is recognized when substantially all
the Company's contractual requirements under the franchise agreement are
completed. Refunds of commissions on the cancellation of insurance policies
are reflected at the time of cancellation. Premium financing fee revenue is
recognized when financing is provided to the insured.
Revenues from room sales are recorded at the time services are performed.
3. The results of operations and cash flows for the nine months ended
September 30, 2000 are not necessarily indicative of the results to be
expected for the full year.
4. DCAP Acquisition: Pro Forma Information. Since February 25, 1999, the
Company has been engaged in two lines of business. In one, the Company,
through its wholly-owned subsidiary, DCAP Insurance Agencies, Inc.
("DCAP"), and related entities (collectively, the "DCAP Companies"), is
engaged primarily in placing various types of insurance, including
automobile, motorcycle, boat, life, business and homeowner's insurance, and
excess coverage, with insurance underwriters on behalf of its customers. In
addition to commission revenue from such services, the Company generates
fee revenue in connection with the grant of franchises to operate DCAP
locations. The DCAP Companies also offer income tax return preparation
services, automobile club services for roadside emergencies and premium
financing services for their customers. The Company has been in this line
of business since its February 25, 1999 acquisition of the DCAP Companies.
In its other line of business, the Company, through its wholly-owned
subsidiary, IAH, Inc., operates the International Airport Hotel in San
Juan, Puerto Rico (the "Hotel"). The Hotel
7
<PAGE>
caters generally to commercial and tourist travelers in transit.
As indicated above, on February 25, 1999, the Company acquired all of the
outstanding stock of DCAP as well as interests in the other DCAP Companies.
This transaction was accounted for under the purchase method of accounting.
Accordingly, the Company's condensed consolidated statements of operations
include the revenues and expenses of the DCAP Companies from February 25,
1999.
During 1999, the Company also acquired the interests of its joint venture
partners in various DCAP retail insurance stores. These transactions have
been accounted for under the purchase method of accounting.
The following pro forma results were developed assuming the acquisition of
the DCAP Companies and the joint venture interests had occurred as of
January 1, 1999. The Company's actual results for the nine months ended
September 30, 2000 are also reflected below.
Nine Months Ended
September 30,
2000 1999
---------- -----------
(actual) (pro forma)
Revenues $6,526,993 $7,165,132
Net loss (537,649) (787,912)
Loss per share (.04) (.07)
The pro forma net loss for the nine months ended September 30, 1999 and the
actual net loss for the nine months ended September 30, 2000 each includes
amortization of goodwill and other purchased intangibles of $275,942. The
above unaudited pro forma condensed consolidated financial information is
presented for illustrative purposes only and is not necessarily indicative
of the condensed consolidated results of operations in future periods or
the results that actually would have been realized had the Company and the
DCAP Companies been a combined company during the specified period or the
joint venture interests had been acquired as of January 1, 1999.
5. Segment and Related Information. In 1999, the Company adopted SFAS No. 131,
Disclosures About Segments of an Enterprise and Related Information, which
changes the way the Company reports information about its operating
segments. The Company has two business units with separate management teams
that provide different products and services.
Summarized financial information concerning the Company's reportable
segments is shown in the following table:
Nine months ended
September 30, 2000
------------------
DCAP
Companies Hotel Other(1) Total
---------- -------- --------- ----------
Revenues $5,714,330 $758,584 $ 54,079 $6,526,993
Net income (loss) (162,700) 109,869 (484,818) (537,649)
8
<PAGE>
Nine months ended
September 30, 1999
------------------
DCAP
Companies Hotel Other(1) Total
--------- --------- --------- ----------
Revenues $5,185,085 $776,612 $ 39,595 $6,001,292
Net income (loss) (236,724) 128,169 (287,929) (396,484)
------------
(1) Column represents corporate-related items and, as it relates to
segment net income (loss), income and expense, including expenses for
amortization of goodwill and other intangibles ($275,942 for the nine
months ended September 30, 2000 and $182,012 for the nine months ended
September 30, 1999), not allocated to reportable segments.
6. On February 25, 1999, concurrently with the acquisition of the DCAP
Companies, Eagle Insurance Company ("Eagle") purchased 1,486,893 Common
Shares of the Company for an aggregate purchase price of approximately
$1,000,000 or $.67 per share. Eagle is a New Jersey insurance company
wholly-owned by The Robert Plan Corporation, an insurance holding company
that is engaged in providing services to insurance companies.
7. Effective June 2, 2000, in connection with the Company's June 1999 private
placement offering, an additional 761,342 Common Shares, 253,778 Class A
Warrants, 253,778 Class B Warrants and 253,778 Class C Warrants were issued
to investors. The shares and warrants were issued pursuant to price
protection provisions contained in the offering agreement. Effective June
2, 2000, the exercise prices of the Class A Warrants, Class B Warrants and
Class C Warrants were reduced to $1.10, $1.37 and $1.65, respectively, per
share.
8. In May 2000, the Company sold its ownership interests in four joint
ventures to a related party for $141,000, which will be paid over six
years. Interest at 6% per annum will be payable commencing May 2001. In
connection with the sale, the Company recorded a $75,822 loss.
9
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
---------------------------------------------------------
NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
Background
During 1998 and prior to February 25, 1999, the sole business of DCAP
Group, Inc. (the "Company") was the operation, through a wholly-owned
subsidiary, IAH, Inc., of the International Airport Hotel in San Juan, Puerto
Rico (the "Hotel").
On February 25, 1999, the Company acquired all of the issued and
outstanding shares of Common Stock of DCAP Insurance Agencies, Inc. (formerly
Dealers Choice Automotive Planning Inc.) ("DCAP") as well as interests in
certain companies affiliated with DCAP (collectively with DCAP, the "DCAP
Companies"). The DCAP Companies are engaged primarily in placing various types
of insurance, including automobile, motorcycle, boat, life, business and
homeowner's insurance, and excess coverage, with insurance underwriters on
behalf of their customers. In addition to commission revenue from such services,
the Company generates fee revenue in connection with the grant of franchises to
operate DCAP locations. The DCAP Companies also offer income tax return
preparation services, automobile club services for roadside emergencies and
premium financing services for their customers.
The DCAP Companies are compensated for their insurance-related services by
commissions paid by insurance companies; the commission is usually a percentage
of the premium paid by the insured. The DCAP Companies do not engage in
underwriting activities and therefore do not assume underwriting risks.
There are 66 existing "DCAP" offices in the New York metropolitan area. As
discussed below, an additional 13 are anticipated to be opened by January 31,
2001. Of the existing locations, 13 are wholly-owned by the Company, two are
owned partially by the Company (ranging between 50% and 80%) and partially by
other persons who generally operate the location (the "joint venture partner")
and 51 are franchises in which the Company has no equity interest; the
franchisor, DCAP Management Corp., however, is wholly-owned by the Company.
During the period from September 1, 1999 through October 31, 2000, the Company
sold an aggregate of 37 franchises. Twenty-four of these are currently open for
business. It is anticipated that the remaining 13 franchised stores will open by
January 31, 2001 with the result that there would be 79 "DCAP" locations.
Concurrently with the closing of the DCAP acquisition, the Company issued
and sold to Eagle Insurance Company ("Eagle") 1,486,893 Common Shares for an
aggregate purchase price of approximately $1,000,000.
Eagle is a New Jersey insurance company wholly-owned by The Robert Plan
Corporation ("The Robert Plan"), an insurance holding company that is engaged in
providing services to insurance companies. Pursuant to separate agency
agreements between certain DCAP Companies and certain insurance company
subsidiaries of The Robert Plan, such DCAP Companies have been appointed agents
of the insurance companies with regard to the offering of automobile and other
insurance products.
In June 1999, the Company raised gross proceeds of $1,675,000 through a
private placement of its securities.
10
<PAGE>
Pursuant to various agreements entered into by the Company in December
1999, the Company acquired the interests of its joint venture partners in 15
DCAP retail insurance stores, in exchange for the issuance of approximately
850,000 Common Shares of the Company. These acquisitions were part of the
Company's plan to phase out joint ventures in the DCAP system and to concentrate
on wholly-owned and franchise operations.
Results of Operations
The Company's net loss for the nine months ended September 30, 2000 was
$537,649 as compared to a net loss of $396,484 for the nine months ended
September 30, 1999. The results of operations for the nine months ended
September 30, 1999 included the results of operations of the DCAP Companies from
February 25, 1999, the date of the acquisition by the Company of the DCAP
Companies. On a pro forma basis (assuming that the acquisition of the DCAP
Companies and certain interests of joint venture partners had occurred as of
January 1, 1999), the Company's net loss for the nine months ended September 30,
1999 would have been $787,912.
During the nine months ended September 30, 2000, revenues from the
operations of the DCAP Companies were $5,714,330 (including $1,004,000 in
initial franchise fees, i.e., from the grant of franchises). On a pro forma
basis (using the above assumption), revenues from the operations of the DCAP
Companies during the nine months ended September 30, 1999 would have been
$6,348,925 (including $42,000 in initial franchise fees). On a pro forma basis,
there was a decline in revenues from the operations of the DCAP Companies (net
of initial franchise fees) of $1,596,595 between the nine months ended September
30, 1999 and 2000 generally due to competitive pressures in the industry and the
sale (and, in general, conversion to franchise status) or closure of certain
DCAP offices. Hotel revenues remained generally constant between the nine months
ended September 30, 1999 and 2000.
The operations of the DCAP Companies during the nine months ended September
30, 2000, on a stand-alone basis, generated a net loss of $162,700 (after giving
effect to a loss of $75,822 incurred in connection with a sale of ownership
interests in joint ventures) as compared to a net loss of $236,724 for the nine
months ended September 30, 1999. The operations of the Hotel during the nine
months ended September 30, 2000, on a stand-alone basis, generated net income of
$109,869 as compared to a net income of $128,169 for the comparable period in
1999. Accordingly, the $141,165 increase in loss for the nine months ended
September 30, 2000 as compared to the nine months ended September 30, 1999 was
the result primarily of an increase of $196,889 in loss not attributable to the
operations of either the DCAP Companies or the Hotel (including an increase in
amortization expenses of $93,930 relating to goodwill and other intangible
assets generated primarily by the acquisitions of the DCAP Companies and certain
interests of joint venture partners (which were accounted for under the purchase
method of accounting)).
Liquidity and Capital Resources
As of September 30, 2000, the Company had $879,704 in cash and cash
equivalents and a working capital deficiency of $536,229. As of December 31,
1999, the Company had $943,176 in cash and cash equivalents and a working
capital deficiency of $211,777.
Cash and cash equivalents decreased between December 31, 1999 and September
30, 2000 due to cash used to acquire property and equipment of $75,261 and to
repay long-term debt and capital lease obligations of $216,762, and an increase
in notes and other receivables of $275,214,
11
<PAGE>
offset by net cash provided by operating activities in the amount of $503,765.
The Company's liquidity at September 30, 2000 was insufficient to meet
operating requirements. In order to reduce its working capital deficiency and
alleviate cash flow demands, the Company intends to take the following actions:
(i) continue efforts to expand franchise operations and decrease the number of
Company-owned stores (by sale of selected stores and, in general, conversion to
franchise status), with a resultant increase in both franchise-related revenue
and revenue from the sale of the stores; (ii) continue efforts to reduce
overhead expenses; and (iii) seek an infusion of capital.
Forward Looking Statements
Certain information contained in the matters set forth above are
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, and is subject to the safe harbor created by that
act. The Company cautions readers that certain important factors may affect the
Company's actual results and could cause such results to differ materially from
any forward- looking statements which may be deemed to have been made above and
elsewhere in this Quarterly Report or which are otherwise made by or on behalf
of the Company. For this purpose, any statements contained above and elsewhere
in this Quarterly Report that are not statements of historical fact may be
deemed to be forward-looking statements. Without limiting the generality of the
foregoing, words such as "may," "will," "expect," "believe," "anticipate,"
"intend," "could," "estimate," or "continue" or the negative variations of those
words or comparable terminology are intended to identify forward-looking
statements. Factors which may affect the Company's results include, but are not
limited to, the risks and uncertainties associated with undertaking different
lines of business, the lack of experience in operating certain new business
lines, the volatility of insurance premium pricing, government regulation,
competition from larger, better financed and more established companies, the
possibility of tort reform and a resultant decrease in the demand for insurance,
the uncertainty of the litigation with regard to the Hotel lease, the dependence
on the Company's executive management, and the ability of the Company to raise
additional capital which may be required in the near term. The Company is also
subject to other risks detailed herein or detailed from time to time in the
Company's Securities and Exchange Commission filings.
12
<PAGE>
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
None
Item 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None
Item 3. DEFAULTS UPON SENIOR SECURITIES
None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
Item 5. OTHER INFORMATION
None
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
3(a) Certificate of Incorporation, as amended(1)
3(b) By-laws, as amended(2)
27 Financial Data Schedule
(b) Reports on Form 8-K
No Current Report on Form 8-K was filed by the Company during the
quarter ended September 30, 2000.
--------
1 Denotes document filed as exhibits to the Company's Annual Reports on Form
10-KSB for the years ended December 31, 1993 and 1998 and incorporated
herein by reference.
2 Denotes document filed as an exhibit to the Company's Annual Report on Form
10-KSB for the year ended December 31, 1998 and incorporated herein by
reference.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
DCAP GROUP, INC.
Dated: November 14, 2000 By: /s/Kevin Lang
--------------
Kevin Lang
President
Dated: November 14, 2000 By: /s/Abraham Weinzimer
---------------------
Abraham Weinzimer
Executive Vice President
(Principal Financial Officer)
<PAGE>
