<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
<TABLE>
<S> <C>
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the period ended DECEMBER 31, 1996
[ ] Transaction report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from __________ to __________
</TABLE>
Commission file number: 1-7467
------
FIRST OF MICHIGAN CAPITAL CORPORATION
------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 13-2780197
- ------------------------------------ -----------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
100 RENAISSANCE CENTER/26TH FLOOR
DETROIT, MICHIGAN 48243
- ------------------------------------ -----------------------------------------
(Address of principal executive offices) (Zip Code)
(313) 259-2600
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
NOT APPLICABLE
- --------------------------------------------------------------------------------
(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. YES [ X ] 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:
Common Stock, $.10 Par Value - 2,582,439 shares as of February 6, 1997
<PAGE> 2
INDEX
FIRST OF MICHIGAN CAPITAL CORPORATION
PART I. FINANCIAL INFORMATION
<TABLE>
<S> <C>
Item 1. Financial Statements (Unaudited)
Condensed consolidated balance sheets - December 31, 1996 and September 27, 1996
Condensed consolidated statements of income - Three months ended December 31, 1996
and December 29, 1995
Condensed consolidated statements of cash flows - Three months ended December 31, 1996
and December 29, 1995
Notes to condensed consolidated financial statements - December 31, 1996
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
</TABLE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
EXHIBIT INDEX
Exhibits
<PAGE> 3
PART I. FINANCIAL INFORMATION
FIRST OF MICHIGAN CAPITAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
December 31, September 27,
1996 1996
------------ -------------
<S> <C> <C>
ASSETS
Cash and cash equivalents............................$ 4,968,544 $ 4,413,970
Receivable from brokers and dealers.................. 3,966,534 2,779,493
Receivable from customers............................ 74,559,819 76,358,815
Notes receivable from employees...................... 2,126,381 2,008,716
Income taxes receivable.............................. 1,072,972 1,072,972
Other accounts receivable............................ 989,809 1,114,085
Securities owned..................................... 7,373,234 6,574,071
Memberships in exchanges, at cost (market value-
$ 1,261,000 at December 31, 1996 and
$ 1,212,000 at September 27, 1996)............... 420,453 420,453
Equipment and leasehold improvements, at
depreciated cost.................................. 3,043,104 3,063,704
Other investments.................................... 219,972 230,331
Deferred income taxes................................ 912,000 826,000
Other assets......................................... 3,091,740 2,690,741
-------------- ---------------
$ 102,744,562 $ 101,553,351
============== ===============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Notes payable to banks............................$ 21,600,000 $ 18,500,000
Payable to brokers and dealers.................... 18,491,776 31,630,491
Payable to customers.............................. 17,604,778 9,410,879
Securities sold, not yet purchased................ 850,904 363,666
Employee compensation payable..................... 6,152,243 7,346,850
Income taxes payable.............................. 662,134 42,159
Other accounts payable and accrued liabilities.... 5,896,293 3,466,958
Capital lease obligation.......................... 866,964 940,539
-------------- ---------------
72,125,092 71,701,542
Contingencies - See note
Stockholders' equity:
Common stock, $.10 par value 10,000,000
shares authorized, 2,891,558 issued.............. 289,156 289,156
Capital in excess of par value....................... 3,676,635 3,676,635
Retained earnings.................................... 29,406,205 28,362,180
-------------- ---------------
33,371,996 32,327,971
-------------- ---------------
Less treasury stock, at cost (291,633 shares at
December 31, 1996 and 258,025 at September 27, (2,752,526) (2,476,162)
1996............................................. -------------- ---------------
30,619,470 29,851,809
-------------- ---------------
$ 102,744,562 $ 101,553,351
============== ===============
</TABLE>
Note: The balance sheet at September 27, 1996 has been derived from the
audited financial statements at that date but does not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. See notes to condensed consolidated
financial statements.
I-1
<PAGE> 4
FIRST OF MICHIGAN CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
------------------------------
DECEMBER 31, DECEMBER 29,
1996 1995
------------- --------------
<S> <C> <C>
REVENUES:
Commissions................................................... $ 10,628,682 $ 9,719,951
Principal transactions........................................ 1,323,273 1,015,766
Investment banking............................................ 1,916,764 2,301,881
Interest...................................................... 1,645,673 1,875,801
Insurance commissions......................................... 1,034,781 640,336
Other......................................................... 1,196,006 1,453,872
-------------- --------------
Total revenues............................................. $ 17,745,179 $ 17,007,607
-------------- --------------
EXPENSES:
Employee compensation and benefits................... $ 9,540,615 $ 9,378,206
Floor brokerage, exchange, clearance and
other fees................................................ 1,245,193 1,243,346
Communications................................................ 256,461 311,987
Interest...................................................... 562,649 857,043
Occupancy and equipment rental................................ 1,376,244 1,283,877
Taxes, other than income taxes................................ 546,028 582,274
Office supplies and expenses................................. 983,037 1,027,792
Other operating expenses...................................... 1,595,927 1,686,751
-------------- --------------
Total expenses................................................ 16,106,154 16,371,276
-------------- --------------
Income before income taxes.............................. 1,639,025 636,331
Provision for income taxes............................... 595,000 220,000
-------------- --------------
Net income ...................................................... $ 1,044,025 $ 416,331
============== ==============
Net income per share............................................ $ .40 $ .15
Average number of common and common
equivalent shares outstanding for income
per share...................................................... 2,629,316 2,754,836
Cash dividends per share......................................... --- ---
</TABLE>
See notes to condensed consolidated financial statements.
I-2
<PAGE> 5
FIRST OF MICHIGAN CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
-------------------
December 31, December 29,
1996 1995
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income......................................................$ 1,044,025 $ 416,331
Noncash items included in net income:
Depreciation and amortization................................ 228,661 204,762
Deferred income taxes........................................ (25,000) (100,000)
Loss (gain) on sale of fixed assets.......................... (183) 106
------------- ------------
1,247,503 521,199
------------- ------------
(Increase) decrease in operating receivables:
Customers.................................................... 1,798,996 (3,396,051)
Brokers and dealers.......................................... (1,187,041) (7,146,798)
Employees.................................................... (117,665) 421,274
Other........................................................ 124,276 (527,090)
Increase (decrease) in operating payables:
Customers.................................................... 8,193,899 9,718,385
Brokers and dealers.......................................... (13,138,715) (11,801,354)
Employee compensation........................................ (1,194,607) (1,810,923)
Income taxes................................................. 619,975 (72,018)
Other........................................................ 2,429,335 530,363
(Increase) decrease in:
Securities inventory......................................... (799,163) (5,032,087)
Other assets................................................. (461,999) 113,215
Increase (decrease) in:
Securities sold, not yet purchased........................... 487,238 (210,364)
------------- ------------
(3,245,471) (19,213,448)
------------- ------------
CASH USED FOR OPERATING ACTIVITIES.............................. (1,997,968) (18,692,249)
------------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in short-term borrowings............................ 3,100,000 20,000,000
Payments on capital lease obligation......................... (73,575) (70,307)
Employee stock transactions.................................. --- 17,612
Repurchases of common stock.................................. (276,364) (1,177,400)
------------- ------------
CASH PROVIDED BY FINANCING ACTIVITIES........................... 2,750,061 18,769,905
------------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Net payments for equipment and leasehold improvements........ (207,878) (597,230)
Purchases, advances and other activity in other
investments - net.......................................... 10,359 128,250
------------- ------------
CASH USED FOR INVESTING ACTIVITIES.............................. (197,519) (468,980)
------------- ------------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS................ 554,574 (391,324)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR.................. 4,413,970 2,995,513
------------- ------------
CASH AND CASH EQUIVALENTS AT END OF YEAR........................$ 4,968,544 $ 2,604,189
============= ============
Income tax payments.............................................$ 25 $ 392,018
Interest payments...............................................$ 568,051 $ 766,118
</TABLE>
See notes to condensed consolidated financial statements.
I-3
<PAGE> 6
FIRST OF MICHIGAN CAPITAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
DECEMBER 31, 1996 AND DECEMBER 29, 1995
SUMMARY OF PRINCIPAL ACCOUNTING POLICIES
The condensed consolidated financial statements include the accounts and
operations of First of Michigan Capital Corporation and its subsidiary
companies (the Company) including First of Michigan Corporation, a registered
securities broker-dealer and a member organization of the New York Stock
Exchange, Inc., after elimination of all significant intercompany accounts and
transactions.
Securities owned and securities sold, not yet purchased, are valued at market
and unrealized gains and losses are reflected in revenues.
Investment account securities are carried at the lower of cost or market.
Certain other investments are accounted for on the equity method. The
Company's equity in such operations was not material in amount during the
periods ended December 31, 1996 and December 29, 1995.
Net income per share is computed on the basis of the weighted average number of
common shares outstanding, assuming dilutive stock options were exercised at
the beginning of the quarter or at the date of issuance, if later, with the
applicable proceeds used to acquire additional treasury shares at the average
market price for the period.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
about amounts in the financial statements and accompanying notes. Actual
results could differ.
INCOME TAXES
The provision for income taxes consists of the following:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
------------------
DECEMBER 31, 1996 DECEMBER 29, 1995
------------------ ------------------
FEDERAL STATE & LOCAL FEDERAL STATE & LOCAL
------- ------------- ------- -------------
<S> <C> <C> <C> <C>
Current ... $600,000 $20,000 $310,000 $10,000
Deferred .. (25,000) --- (100,000) ---
-------- ------- -------- ----------
Total ..... $575,000 $20,000 $210,000 $10,000
======== ======= ======== ==========
</TABLE>
Deferred income taxes arise principally arise from deferred compensation
expense and retirement benefits expense.
CONTINGENCIES
In the normal course of business, First of Michigan Corporation enters into
underwriting commitments. Transactions relating to such underwriting
commitments which were open at December 31, 1996 and subsequently settled, had
no material effect on the financial statements as of that date.
As is the case with many firms in the securities industry, First of Michigan
Corporation is a defendant or co-defendant in a number of lawsuits or
arbitration's alleging damages, which are ordinary and routine litigation and
arbitration, incidental to the securities and investment banking business. The
Company is contesting the allegations of the complaints in these cases and
believes that there are meritorious defenses in each of these lawsuits. Some
of the proceedings relate to public underwriting of securities in which First
of Michigan Corporation participated as a member of the underwriting syndicate.
I-4
<PAGE> 7
In view of the number and diversity of claims against the Company and the
inherent difficulty of predicting the outcome of litigation and other claims,
the Company cannot state with certainty what the eventual outcome of pending
litigation or other claims will be. The Company provides for costs relating to
these matters when a loss is probable and the amount can be reasonably
estimated. The effect of the outcome of these matters on the Company's future
results of operations cannot be predicted because any such effects depends on
future results of operations and the amount and timing of the resolution of such
matters. While it is not possible to predict with certainty, management
believes that the ultimate resolution of such matters will not have a material
adverse effect on the consolidated financial position of the Company.
CAPITAL REQUIREMENTS
First of Michigan Corporation is subject to the uniform net capital rule (Rule
15c3-1) of the Securities and Exchange Commission and the capital rules of the
New York Stock Exchange, Inc., of which it is a member, and elects to compute
its net capital requirements in accordance with the alternative method.
Under this method, the Corporation is required to maintain minimum net capital,
as defined, equal to 2 percent of aggregate debit balances arising from customer
transactions, as defined. The net capital rules also provide that equity
capital may not be withdrawn or cash dividends paid if the resulting net capital
would be less than 5 percent of aggregate debits. At December 31, 1996 First of
Michigan Corporation's net capital of $17,539,786 was 22 percent of aggregate
debit balances, and was $15,953,643 in excess of the 2 percent minimum net
capital required and $13,574,428 in excess of the 5 percent dividend
restriction.
-----------------
The preceding information is unaudited and accordingly, does 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 only of normal recurring accruals) considered necessary
for a fair presentation of the results of the period have been included. The
results for the interim period are not necessarily indicative of the results to
be expected for the full year. For further information, refer to the financial
statements and footnotes thereto included in the Company's annual report on Form
10-K for the year ended September 27, 1996.
I-5
<PAGE> 8
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
First quarter fiscal 1997 compared to first quarter fiscal 1996.
GENERAL
First of Michigan Capital Corporation's principal subsidiary is First of
Michigan Corporation, a member of the New York Stock Exchange Inc., and
Michigan's largest full-service securities firm. Founded more than 60 years
ago, First of Michigan Corporation specializes in a wide range of financial
services that include investment products such as stocks, bonds, unit trusts
and mutual funds; investment services such as retirement plans, money
management, underwriting and trading and investment banking. First of Michigan
offers these services through its 548 employees located in 32 offices
throughout Michigan, as well as an office at 100 Wall Street, New York.
The Company's profitability, to a large degree, is sensitive to the volume of
trading in securities and the volatility and general level of securities market
prices. While the Company places emphasis on controlling fixed costs, many of
its activities have high operating costs which do not decrease proportionately
with reduced levels of activity. Sustained periods of reduced volume, or loss
of clients, could have adverse effects upon profitability.
RESULTS OF OPERATIONS
During the quarter ended December 31, 1996, the U.S. financial markets
continued their upward movement due to low inflation and interest rates as well
as a growing economy. Retail trade volume at First of Michigan Corporation for
the quarter was up 13% versus the same period last year, however, the average
commission per trade has decreased. Total revenues for the three months
increased $.7 million or 5%. Net income increased $.6 million (151%) to $.40
per share compared to $.15 per share last year.
The largest dollar increase ($.9 million) was from commission revenues which
includes revenues from listed and over-the-counter equity transactions as well
as increased revenues from mutual fund transactions. The Company is a
market-maker in both equity and fixed income products and maintains inventory
of varying amounts in these products. Revenues from these principal
transactions favored equities this quarter while demand for fixed income
products decreased. Investment banking revenues decreased primarily due to
fewer financial consulting engagement fees received during the quarter.
Interest income, primarily derived from customer borrowings on margin, declined
as short-term rates were down approximately 50 basis points ( .5%) from this
same time last year. Insurance commissions increased $.4 million or 62%
primarily in the area of tax-favored variable annuities. Other revenues
decreased due to the discontinuance as distributor for certain non-proprietary
money market funds for a local bank.
Total expenses decreased $.3 million or 2% reflecting the Company's continuing
cost containment efforts. The largest expense category, employee compensation
and benefits, increased in conjunction with the increase in commission revenues
as well as an increase in certain discretionary bonus programs associated with
the level of pre-tax earnings. Communications expenses have decreased due to a
change in long-distance telephone carriers as well as rate reduction savings
from contract re-negotiation. Interest expense decreased due to lower stock
loan balances with other broker-dealers as well as the decrease in interest
rates. The provision for income taxes was up proportionately to the increase
in pre-tax earnings. Net income per share of $.40 for the quarter included
$.02 per share due to the Company's repurchase of some of its outstanding
shares on the open market. The Board of Directors has authorized the Company
to repurchase up to 350,000 shares of it's outstanding stock for which
approximately 77,000 shares have been repurchased as of December 31, 1996.
I-6
<PAGE> 9
LIQUIDITY AND CAPITAL RESOURCES
Cash used for operating activities showed a net decrease for the three month
period. The largest source of cash resulted from an increase in payables to
customers. The greatest use of cash resulted from a reduction in payables to
other broker and dealers. Due to the nature of the Company's business, the
changes in operating asset and liability account balances for any particular
accounting period can be quite large and, therefore, are not very useful
indicators of long-term trends in the Company's cash uses for operations. Cash
provided by financing and investing activities showed a net increase due to an
increase in short-term bank borrowings. At December 31, 1996, approximately 90%
of the Company's assets were liquid, consisting mainly of cash or assets readily
convertible into cash. The Company's largest asset is its receivables from
customers, representing borrowings from the Company by customers to finance the
purchase of securities on margin. Such receivables from customers are
substantially financed by equity capital, short-term borrowings under
established lines of credit with several banking institutions as well as from
stock loan activities. A total of $122,000,000 in approved lines of credit was
available to the Company at December 31, 1996, of which $21,600,000 was
outstanding.
Under separate agreements, First of Michigan Capital Corporation had available
short-term lines of credit on an unsecured basis, aggregating $8,000,000.
There were no borrowings against these lines of credit at December 31, 1996.
The Company is subject to the net capital requirements of the Securities and
Exchange Commission and the New York Stock Exchange Inc., which are designed to
measure the general financial soundness and liquidity of broker-dealers. The
Company has consistently operated well in excess of the minimum requirements.
At December 31, 1996, the Company's net capital of $17,539,786 exceeded the
minimum requirement by $15,953,643.
Management believes that funds provided by net cash earnings combined with the
liquidity of its assets, its existing capital base and its available lines of
credit are fully adequate to meet the Company's financing needs for the
foreseeable future.
The Company does not engage in any derivative trading that would result in any
additional off-balance sheet risk.
CONTINGENT MATTERS
First of Michigan Corporation is the subject of claims made in several civil
actions arising out of its business as a broker-dealer and as an investment
banker. The company provides for costs related to contingencies when a loss is
probable and the amount is reasonably determinable. While these actions in the
aggregate seek substantial amounts, management believes that their ultimate
resolution, to the extent not previously provided for, will not have a material
adverse effect on the financial condition, liquidity, or results of operations
of the Company. However, depending on the amount and timing of an unfavorable
resolution to a contingency, it is possible that the Company's future results
of operations or cash flows could be materially affected in a particular
quarter.
OUTLOOK
The Company is focusing on growing its business in the State of Michigan and
on generating a reasonable level of profitability. Recruiting efforts for
experienced investment executives is continuing as well as the development of
new financial products and services. The Company is monitoring the level of
all expenses closely and making adjustments wherever beneficial savings can be
achieved. Due to the recent purchase by General Motors of the building in
which the Company's headquarters is located, its lease expiring on August 31,
1997 will not be renewed. The Company is reviewing alternative buildings in
the Detroit area and will be moving to a new location approximatley August
1997. While the net income for the three months ended December 31, 1996 was
favorable, no assurance can be made that future earnings will be indicative of
the current period.
I-7
<PAGE> 10
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) The following exhibits are included herein:
(11) Computation of Per Share Earnings
(27) Financial Data Schedule
(b) Reports on Form 8-K:
The Company did not file any reports on Form 8-K during the three
months ended December 31, 1996.
II-1
<PAGE> 11
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.
FIRST OF MICHIGAN CAPITAL CORPORATION
February 13, 1997 /s/ Conrad W. Koski
---------------------------------------
CONRAD W. KOSKI
PRESIDENT AND CHIEF EXECUTIVE OFFICER
February 13, 1997 /s/ Charles M. Grimley
---------------------------------------
CHARLES M. GRIMLEY
TREASURER AND CHIEF FINANCIAL OFFICER
S-1
<PAGE> 12
EXHIBIT INDEX
(11) Computation of Per Share Earnings
(27) Financial Data Schedule
<PAGE> 1
EXHIBIT 11
FIRST OF MICHIGAN CAPITAL CORPORATION
COMPUTATION OF PER SHARE EARNINGS
<TABLE>
<CAPTION>
For the Three Months Ended
--------------------------
December 31, 1996 December 29, 1995
----------------- -----------------
Primary Fully Diluted Primary Fully Diluted
------- ------------- ------- -------------
<S> <C> <C> <C> <C>
Weighted average shares
outstanding:
Common shares 2,627,681 2,627,681 2,751,910 2,751,910
Dilutive shares available
under stock option plans 1,635 (363) 2,926 2,533
Weighted average common shares
and common stock equivalents
--------- --------- --------- ---------
outstanding 2,629,316 2,627,318 2,754,836 2,754,443
========= ========= ========= =========
Net earnings applicable to
common shares $ 1,044,025 $ 1,044,025 $ 416,331 $ 416,331
========= ========= ========= =========
Earnings per share $ .40 $ .40 $ .15 $ .15
========= ========= ========= =========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> BD
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-26-1997
<PERIOD-START> SEP-28-1996
<PERIOD-END> DEC-31-1996
<CASH> 4,968,544
<RECEIVABLES> 79,944,271
<SECURITIES-RESALE> 0
<SECURITIES-BORROWED> 2,771,244
<INSTRUMENTS-OWNED> 7,373,234
<PP&E> 3,043,104
<TOTAL-ASSETS> 102,744,562
<SHORT-TERM> 21,600,000
<PAYABLES> 74,483,671
<REPOS-SOLD> 0
<SECURITIES-LOANED> 17,546,500
<INSTRUMENTS-SOLD> 850,904
<LONG-TERM> 0
0
0
<COMMON> 289,156
<OTHER-SE> 30,330,314
<TOTAL-LIABILITY-AND-EQUITY> 102,744,562
<TRADING-REVENUE> 1,323,273
<INTEREST-DIVIDENDS> 1,645,673
<COMMISSIONS> 10,628,682
<INVESTMENT-BANKING-REVENUES> 1,916,764
<FEE-REVENUE> 1,196,006
<INTEREST-EXPENSE> 562,649
<COMPENSATION> 9,540,615
<INCOME-PRETAX> 1,639,025
<INCOME-PRE-EXTRAORDINARY> 1,044,025
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,044,025
<EPS-PRIMARY> 0.40
<EPS-DILUTED> 0.40
</TABLE>
