<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended October 2, 1999 - Commission file Number 0-17038
---------------
Concord Camera Corp.
-----------------------------------------------------
(Exact names of registrant as specified in its charter)
New Jersey 13-3152196
---------------------------- -------------------
(State or other Jurisdiction (I.R.S. Employer
of Incorporation) Identification No.)
4000 Hollywood Blvd. Suite 650N, Hollywood, Florida 33021
---------------------------------------------------------
(Address of principal executive office) (Zip code)
954/331-4200
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(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
--- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock, no par value -- 11,686,117 shares as of October 27, 1999
------------------------------
Page 1 of 12
(Exhibit Index on Page 11)
<PAGE>
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Concord Camera Corp.
Condensed Consolidated Balance Sheets
<TABLE>
<CAPTION>
(Unaudited) (Note)
October 2, 1999 July 3, 1999
--------------- ------------
<S> <C> <C>
Assets
Current Assets:
Cash and cash equivalents $33,984,199 $30,706,761
Accounts receivable, net 19,297,523 18,272,329
Inventories, net 22,268,414 20,620,556
Prepaid expenses and other current assets 2,898,643 2,404,400
------------ -----------
Total current assets 78,448,679 72,004,046
Plant and equipment, net 19,827,865 18,871,300
Goodwill, net 279,109 291,764
Other assets 5,094,906 5,480,342
------------ -----------
Total assets $103,650,559 $96,647,452
============ ===========
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $19,383,247 $16,224,538
Accrued expenses 7,555,524 4,985,789
Short term debt 8,209,281 8,088,901
Current portion of long-term debt - 2,100,000
Current portion of obligations under capital leases 1,934,585 2,073,492
Income taxes payable 1,275,549 896,142
Other current liabilities 259,751 188,058
------------ -----------
Total current liabilities 38,617,937 34,556,920
Deferred income taxes 792,358 792,358
Long-term debt, net of current portion 14,850,000 14,850,000
Obligations under capital leases, net of current portion 2,248,442 2,623,080
Other long-term liabilities 1,041,693 1,129,569
------------ -----------
Total liabilities 57,550,430 53,951,927
------------ -----------
Commitment and contingencies
Stockholders' equity:
Common stock, no par value, 40,000,000 authorized; 11,686,117 and
11,629,592 issued as of October 2, 1999 and July 3, 1999, respectively 41,168,585 41,117,335
Paid in capital 1,033,553 1,033,553
Retained earnings 9,982,317 6,086,691
Notes receivable arising from common stock purchase agreements (1,947,188) (2,163,542)
------------ -----------
50,237,267 46,074,037
Less: treasury stock, at cost; 771,263 and 675,863 shares as of October 2,
1999 and July 3, 1999, respectively (4,137,138) (3,378,512)
------------ -----------
Total stockholders' equity 46,100,129 42,6925,525
------------ -----------
Total liabilities and stockholders' equity $103,650,559 $96,647,452
============ ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
Note: The balance sheet at July 3, 1999 has been derived from the audited
financial statements at that date bur does not include all of the information
and footnotes required by generally accepted accounting principals for complete
financial statements.
2
<PAGE>
Concord Camera Corp.
Condensed Consolidated Income Statements
<TABLE>
<CAPTION>
(Unaudited)
For the three months ended
October 2, 1999 October 3, 1998
--------------- ---------------
<S> <C> <C>
Net sales $41,237,897 $31,023,827
Cost of products sold 29,899,118 22,580,881
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Gross profit 11,338,779 8,442,946
Selling expenses 2,515,627 2,393,179
General and administrative expenses 3,804,843 2,471,095
Interest expense 873,977 805,189
Other (income) expense, net (128,294) 86,095
------------ -----------
Income before income taxes 4,272,626 2,687,338
Provision for income taxes 377,000 229,000
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Net Income $3,895,626 $2,458,388
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Basic earnings per share $0.36 $0.22
------------ -----------
Diluted earnings per share $0.33 $0.21
------------ -----------
Weighted average common shares outstanding - basic 10,959,177 11,139,915
------------ -----------
Effect of dilutive securities: Employee stock options 985,149 720,636
------------ -----------
Weighted average common shares outstanding - diluted 11,944,326 11,860,551
============ ==========
</TABLE>
See accompanying notes to condensed consolidated financial statements
3
<PAGE>
Concord Camera Corp.
Condensed Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
(Unaudited)
For the three months ended
October 2, 1999 October 3, 1998
--------------- ---------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 3,895,626 $ 2,458,389
----------- -----------
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 1,053,711 989,310
Amortization of deferred financing costs 33,354 22,236
Officers notes forgiven on stock purchases 251,066 -
Interest income on notes receivable arising from common stock purchase agreements (34,712) (36,092)
Change in assets and liabilities:
Accounts receivable (1,025,194) 3,977,077
Inventories (1,647,758) (2,049,942)
Prepaid expenses and other current assets (498,637) (1,141,291)
Other assets 237,528 (913,894)
Accounts payable 3,158,709 903,759
Accrued expenses 2,569,735 1,818,655
Income taxes payable 379,407 229,332
Other current liabilities 71,692 226,537
Other long-term liabilities (87,876) -
----------- -----------
Total adjustments 4,461,025 4,025,687
----------- -----------
Net cash provided by operating activities 8,356,651 6,484,076
----------- -----------
Cash flows from investing activities:
Purchase of property, plant and equipment (1,878,672) (1,977,749)
Purchase of treasury stock (758,626) (724,778)
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Net cash used in investing activities (2,637,298) (2,702,527)
----------- -----------
Cash flows from financing activities:
Net borrowings (repayments) under short-term debt agreements 120,380 (1,758,327)
Net borrowings of long-term debt (2,100.000) (8,516)
Net proceeds from issuance of senior notes, net - 14,850,000
Net repayments under capital lease obligations (513,545) (209,590)
----------- -----------
Net proceeds from issuance of common stock 51,250 -
----------- -----------
Net cash used in financing activities (2,441,915) (12,873,567)
----------- -----------
Net increase in cash $ 3,277,438 $16,655,116
Cash at beginning of period 30,706,761 7,119,699
----------- -----------
Cash at end of period $33,984,199 $23,774,815
=========== ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
See Note 3 - Supplemental disclosure of cash flow information.
4
<PAGE>
CONCORD CAMERA CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
October 2, 1999
(unaudited)
Note 1 - General
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principals 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 principals 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 month period ended October 2,
1999 are not necessarily indicative of the results that may be expected for the
year ended July 1, 2000. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Registrant Company's
annual report on Form 10-K for the year ended July 3, 1999.
The Company operates on a worldwide basis and its results may be adversely or
positively affected by fluctuations of various foreign currencies against the
U.S. Dollar, specifically, the Canadian Dollar, German Mark, British Pound
Sterling, French Franc and Japanese Yen. Each of the Company's foreign
subsidiaries purchases its inventories in U.S. Dollars and sells them in local
currency, thereby creating an exposure to fluctuations in foreign currency
exchange rates. Certain components needed to manufacture cameras are purchased
in Japanese Yen. The impact of foreign exchange transactions is reflected in the
profit and loss statement. The Company continues to analyze the benefits and
costs associated with hedging against foreign currency fluctuations.
Note 2 - Inventories
Inventories are comprised of the following:
October 2, 1999 July 3, 1999
--------------- ------------
Raw materials and components $14,592,588 $ 15,605,934
Finished goods 9,342,913 6,389,998
----------- ------------
Subtotal 23,935,501 21,995,932
Less: Reserve for inventory obsolescence (1,667,187) (1,375,376)
----------- ------------
$22,268,414 $20,620,556
=========== ===========
Note 3 - Supplemental Disclosures of Cash Flow Information:
For the three months ended
October 2, 1999 October 3, 1998
--------------- ---------------
Cash paid for interest $ 747,517 $ 700,250
=========== ===========
Cash paid for taxes $ - $ -
=========== ===========
5
<PAGE>
Note 4 -- Litigation and Settlements
Jack C. Benun. On November 18, 1994, the Company filed a demand for arbitration
in New Jersey for money damages in excess of $1.5 million against Jack C. Benun
("Benun"), its former chief executive officer who was discharged for cause in
Fiscal 1995. This action was taken due to Benun's failure to fully compensate
the Company for damages it sustained as a result of Benun's breaching his
employment obligations, his fiduciary obligations and perpetrating frauds upon
the Company including the misappropriation of funds from the Company. Benun has
submitted a counterclaim in which he alleges wrongful termination of his
employment and denial of benefits by the Company. The Company is vigorously
pursuing its action as well as defending the counterclaim. On August 24, 1999,
the arbitrator upheld the propriety of Concord's termination for cause of Benun.
The arbitrator found that Benun perpetrated frauds on the Company by diverting
and embezzling company monies. The Company will now pursue its further damage
claims against Benun related to the frauds and embezzlement.
Fuji. On December 30, 1997, the Company commenced in the United States District
Court of the Southern District of New York (the "Court") an action against Fuji
seeking to enforce the terms of a Settlement Agreement between the Company and
Fuji (the "Settlement Agreement") and to restrain Fuji from terminating the
Settlement Agreement. Under the terms of the Settlement Agreement, the Company
has been granted a worldwide (subject to certain geographic limitations),
non-exclusive license to use certain Fuji technology in connection with the
manufacture and sale of single-use cameras. On January 9, 1998, the Court
granted the Company's request for an order restraining Fuji from terminating the
Settlement Agreement. Pending a final judicial determination of the dispute, the
restraining order will continue in effect as long as the Company refrains from
making any further shipments pursuant to the purchase order which gave rise to
the dispute. The parties are presently engaged in the conception of discovery
and motion practice.
Kubbany. The Company and its subsidiary have been sued in Panama before the
First Tribunal of Labor of the City of Colon, alleging breach of various
employment-related obligations of Joseph Kubbany, a former executive of Concord
Camera (Panama), Inc. A counterclaim against Kubbany has been filed on behalf of
Concord Camera (Panama), Inc. alleging a breach of his employment obligations by
taking unauthorized travel advances. Evidentiary hearing dates have been
concluded. Certain additional submissions and document review are taking place.
Under Panamanian law, certain claims of the employer exceeding the forgoing
amounts were not appropriate for presentation in the Employment Tribunal;
therefore, the Company has filed a civil action against Joseph Kubbany alleging
various breaches of his obligations as the Manager for Concord. (Panama), Inc.
and for losses incurred because of excess inventory and the sale of film and for
restitution of the costs of airplane tickets for his wife paid with Company
funds. The Company has named as a party to the litigation, Dynamic World
Trading, Inc. This case is on going.
The Company is involved from time to time in routine legal matters incidental to
its business. In the opinion of the Company's management, the resolution of such
matters, including those described above, will not have a material effect on its
financial position or results of operations.
6
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Results of Operations
The quarter ended October 2, 1999 compared to the quarter ended October 3, 1998.
Total revenues for the quarters ended October 2, 1999 and October 3,
1998 were approximately $41,238,000 and $31,024,000, respectively, an increase
of approximately $10,214,000 or 32.9%. The increase in revenues for the first
quarter of the company's fiscal year ended July 1, 2000 ("Fiscal 2000") over the
corresponding quarter of the company's fiscal year ended July 3, 1999 ("Fiscal
1999') resulted principally from increases in sales to original equipment
manufacturer ("OEM") and retail distribution customers. OEM revenues for the
quarter ended October 2, 1999 and October 3, 1998 were approximately $28,083,000
and $20,998,000, respectively, an increase of approximately $7,085,000 or 25.2%.
Retail sales for the quarters ended October 2, 1999 and October 3, 1998 were
approximately $13,155,000 and $10,026,000, respectively, an increase of
approximately $3,129,000 or 31.2%.
Sales by Concord Camera HK Limited ("Concord HK") for the quarters
ended October 2, 1999 and October 3, 1998 were approximately $36,265,000 and
$27,269,000, respectively, an increase of approximately $8,996,000 or 33.0%. The
increase is due to the increases in sales to OEM and retail distribution
customers. OEM revenues generated by Concord HK for the quarters ended October
2, 1999 and October 3, 1998 were approximately $28,083,000 and $20,998,000,
respectively, an increase of approximately $7,085,000 or 25.2%. Retail sales
generated by Concord HK for the quarters ended October 2, 1999 and October 3,
1998 were approximately $8,183,000 and $6,271,000, respectively, an increase of
approximately $1,912,000 or 30.5%. The increases in OEM and retail sales are
attributable to increased sales to preexisting OEM and retail customers together
with sales to new OEM and Retail customers.
Consolidated sales of the Company's operations in the United States,
Latin America and Canada ("Concord Americas") for the quarters ended October 2,
1999 and October 3, 1998 were approximately $2,487,000 and $1,852,000,
respectively, an increase of approximately $635,000 or 34.3%. In addition,
certain Concord Americas customers increased merchandise purchases on a F.O.B.
Hong Kong basis from Concord HK. During the quarters ended October 2, 1999 and
October 3, 1998, Concord Americas customers purchased approximately $5,418,000
and $3,803,000, respectively, from Concord HK, an increase of approximately
$1,615,000 or 42.5%. If this increase was added to the quarter ended October 2,
1999 Concord Americas sales, sales to Concord Americas customers would have
increased by 39.8% over sales to such customers during the first quarter of
Fiscal 1999.
Consolidated sales of Concord Camera Europe, Concord Camera GmbH, and
Concord Camera France ("Concord Camera Europe") for the quarters ended October
2, 1999 and October 3, 1998, were approximately $2,485,000 and $1,903,000,
respectively, an increase of approximately $582,000 or 30.6%. In addition,
certain Concord Europe customers increased merchandise purchases on a F.O.B.
Hong Kong basis from Concord HK. During the quarters ended October 2, 1999 and
October 3, 1998, European customers purchased approximately $2,765,000 and
$2,440,000, respectively, from Concord HK, an increase of approximately $325,000
or 13.3%. If this increase was added to the sales for the quarter ended October
2, 1999, European sales to European customers would have increased by 20.9% over
sales to such customers during the first quarter of Fiscal 1999.
Gross Profit
Gross profit, expressed as a percentage of sales, increased to 27.5%
for the quarter ended October 2, 1999 from 27.2% for the quarter ended October
3, 1998. This increase was primarily the result of more favorable absorption of
manufacturing overhead and labor utilization resulting from increased sales and
manufacturing volume and efficiencies. Product development costs were $1,182,000
for the quarter ended October 2, 1999 as compared to $1,244,000 for the quarter
ended October 3, 1998, a decrease of approximately $60,000.
Expenses
As a percentage of sales, operating expenses, consisting of selling,
general and administrative and interest expense, decreased to 17.4% in the
quarter ended October 2, 1999 from 18.3% in the quarter ended October 3, 1998.
Operating expenses increased to $7,194,000 in the quarter ended October 2, 1999
from $5,669,000 in the quarter ended October 3, 1998, an increase of $1,525,000
or 26.9%.
7
<PAGE>
Selling expenses increased to $2,516,000 or 6.1% of net sales in the
quarter ended October 2, 1999 from $2,393,000 or 7.7% of net sales in the
quarter ended October 3, 1998. The increase was primarily attributable to
increases in royalty expenses and promotional allowances net of the benefits
from certain cost cutting activities.
General and administrative expenses increased to $3,805,000 or 9.2% of
net sales in the quarter ended October 2, 1999 from $2,471,000 or 8.0% of net
sales in the quarter ended October 3, 1998.
Interest expense increased to $873,000 or 2.1% of net sales for the
quarter ended October 2, 1999 from $805,000 or 2.6% of net sales in the quarter
ended October 3, 1998. Such increase was primarily a result of an increase in
average debt outstanding during the quarter ended October 2, 1999.
Other (income), Net
Other (income) expense, net was approximately ($128,000) and $86,000 in
the quarters ended October 2, 1999 and October 3, 1998, respectively. Other
(income) expense, net includes directors' fees, certain public relations costs,
foreign exchange gains and losses and interest income.
Income Taxes
The Company's provisions for income taxes for the quarters ended
October 2, 1999 and October 3, 1998 are primarily related to the earnings of the
Company's Far East and domestic operations.
Net Income
As a result of the matters described above, the Company had net income
of approximately $3,896,000 or $0.33 per diluted share in the quarter ended
October 2, 1999, as compared to net income of approximately $2,458,000 or $0.21
per diluted share in the quarter ended October 3, 1998. The Company achieved its
profit plan for the first quarter and is in line to achieve its previously
announced projected profit of $11 to $12 million or $0.94 to $1.03 per diluted
share for the current fiscal year.
Liquidity and Capital Resources
At October 2, 1999, the Company had working capital of $39,830,000 as
compared to $37,447,000 at July 3, 1999. Cash flow provided by operating
activities was approximately $8,357,000 and $6,484,000 for the three months
ended October 2, 1999 and October 3, 1998, respectively. Capital expenditures
for the three months ended October 2, 1999 and October 3, 1998 were
approximately $1,879,000 and $1,978,000, respectively. The Company's principal
funding requirement has been, and is expected to continue to be, the financing
of accounts receivable and inventory. Additionally, the combined United States
operation is dependent upon funding received from the foreign operations.
Senior Notes. On July 30, 1998, the Company consummated a private placement of
$15 million of senior notes. The notes bear interest at 11%, and the maturity
date is July 15, 2005. Interest payments are due quarterly. The agreement
governing the senior notes contains certain restrictive covenants relating to,
among other things, incurrence of additional indebtedness and dividend and other
payment restrictions affecting subsidiaries.
Non-Notification Factoring with Recourse Facility. During the last quarter of
Fiscal 1998, Concord HK consummated a $10,000,000 Non-Notification Factoring
with Recourse Facility (the "Factoring Facility") that is guaranteed by the
Company, is secured by certain accounts receivables of the Company's Hong Kong
operations and bears interest at 1.5% above the prime lending rate. During the
last quarter of Fiscal 1999, $2,000,000 of the factoring facility was converted
into two $1,000,000 equipment leasing facilities with terms of three and four
years each. Availability under the factoring facility is subject to advance
formulas based on eligible accounts receivable with no minimum borrowings. At
October 2, 1999, approximately $6,798,000 was outstanding and classified as
short-term debt.
Hong Kong Credit Facilities. Concord HK has credit facilities (the "HK
Facilities") that provides Concord HK with up to $4,200,000 of financing as
follows: letters of credit of up to $2,900,000, and packing loans of up to
$1,300,000. As of October 2, 1999, approximately $1,411,000 was utilized under
the HK Facilities. The HK Facilities, which are payable on demand, bear interest
at 2% above the prime lending rate, which was 8.5% at October 2, 1999. The
Company guarantees all amounts outstanding under the HK Facilities.
8
<PAGE>
Other Arrangements and Future Cash Commitments. Management believes that
anticipated cash flow from operations together with financing from the Senior
Notes, the Factoring Facility, and HK Facilities or replacement facilities, will
be sufficient to fund its operating cash needs for the foreseeable future.
Impact of Year 2000
Many currently installed computer systems and software are coded to accept only
two digit entries in the date code field. Beginning in the year 2000, these date
code fields will need to accept four digit entries to distinguish twenty-first
century dates from twentieth century dates. As a result computer systems and/or
software used by many companies may need to be upgraded to comply with such
"Year 2000" requirements. The Company has assessed the potential impact of Year
2000 on the processing of date-sensitive information by the Company's
information systems, manufacturing systems and other ancillary systems. While
there can be no assurance that Year 2000 matters will be satisfactorily
identified and resolved, the Company currently believes, based on internal
evaluations and discussions with its information systems vendors, that Year 2000
issues will not have a material adverse affect on the Company.
The Company's Year 2000 initiative is being managed by an internal staff and is
designed to ensure that there are no adverse effects on the Company's ability to
conduct business. The initiative covers the corporate office network and
financial systems, payroll processing, corporate computers, manufacturing
systems and telephone systems. In addition, the Company is reviewing the Year
2000 compliance efforts of the Company's key suppliers and other principal
business partners.
Effective July 4, 1999, the Company implemented an integration software package,
which is fully year 2000 compliant. The implementation was completed as an
Enterprise Resource Planning (ERP) package, which controls the Company's main
systems of (a) shipping/distribution, (b) accounting, (c) customer service/order
entry system, and (d) manufacturing. The Company outsources the payroll portion
of its accounting functions, and such provider has represented to the Company
that it is year 2000 compliant. Thus, all of the Company's computer-dependent
systems have been replaced by the year 2000 compliant package. The Company has
established a supplier compliance program, and is working with its key suppliers
to minimize such risks. The costs incurred related to systems implementation
have not been material to the Company's results of operations, financial
condition or cash flow. The Company believes that future costs of system
implementation will primarily be enhancements to provide for more complete
utilization of applications and are not requirements for year 2000 readiness and
will not have a material impact on the Company's results of operations,
financial condition or cash flows. The Company currently estimates that it will
incur expenses of approximately $50,000 through calendar year 1999 in connection
with its anticipated Year 2000 efforts. The timing and amount of the Company's
expenses may vary and are not necessarily indicative of readiness efforts or
progress to date.
The Company is in the process of developing contingency and business continuity
plans tailored for Year 2000-related occurrences. The Company believes its
significant hardware and software systems are Year 2000 compliant. The Company
believes that the most reasonably likely worst case scenario of failure by the
Company or its suppliers to adequately resolve Year 2000 issues would arise from
a failure of its order entry and accounts receivable system. Such a failure
would require the Company to resort to "non-computerized" means to undertake
such sales and distribution functions as placing customer orders and ordering
inventory. While the Company believes that it is equipped to operate in such a
"non-computerized" mode to address such a failure, there can be no assurance
that the Company would not, as a result of such or any other unanticipated Year
2000 failure, suffer from lost revenues, increased operating costs, loss of
customers or other business interruptions of a material nature.
In consideration of the potential impact of Year 2000 issues on its business,
operations, and financial condition, the Company has addressed issues which may
arise from its systems as described below.
The Company has not formally determined a most reasonably likely worst case
scenario regarding the impact of Year 2000 problems on its business. However,
management believes the most likely and significant Year 2000 related risks
faced by the Company are business interruptions by its customers. Such
interruptions could include distribution and temporary related reduction of
demand for Company products by such customers until the Year 2000 problem is
remedied. Management will attempt to identify and assess any such risks and
follow up with any significant customers that could likely be less than fully
Year 2000 compliant. Based on its assessment and remediation efforts to date,
the Company does not believe that any problems resulting from the Year 2000
issue will have a material adverse effect on its financial condition or results
of operations.
9
<PAGE>
The Company believes that its continuing assessment, planning and implementation
process will be effective to achieve a level of readiness that will meet the
challenges presented by Year 2000 issues in a timely manner. Although the
Company is evaluating the Year 2000 readiness of third-party software, computer
technology and other hardware and software, the Company cannot guarantee the
Year 2000 readiness of third-party products, services, or providers that may
impact the Company's operations.
The above information is based on the Company's current best estimates, which
were derived using numerous assumptions of future events, including the
availability and future costs of certain technological and other resources,
third party modification actions and other factors. Given the complexity of
these issues and possible as yet unidentified risks, actual results may vary
materially from those anticipated and discussed above. Specific factors that
might cause such differences include, among others, the availability and cost of
personnel trained in this area, the ability to locate and correct all affected
computer codes, the timing and success of remedial efforts of the Company's
third party suppliers and similar uncertainties.
Forward-Looking Statements
The statements contained in this report that are not historical facts
are "forward-looking statements" (as such term is defined in the Private
Securities Litigation Reform Act of 1995), which can be identified by the use of
forward-looking terminology such as: "estimates," "projects," "anticipates,"
"expects," "intends," "believes," or the negative thereof or other variations
thereon or comparable terminology, or by discussions of strategy that involve
risks and uncertainties. The Company's actual results could differ materially
from those anticipated in such forward-looking statements. Management wishes to
caution the reader that these forward-looking statements, such as statements
regarding development of the Company's business, the Company's anticipated
capital expenditures, projected profits and other statements contained in this
report regarding matters that are not historical facts, are only estimates or
predictions. No assurance can be given that future results will be achieved.
Actual events or results may differ materially as a result of risks facing the
Company or actual results differing from the assumptions underlying such
statements. In particular, expected revenues could be adversely affected by
production difficulties or economic conditions negatively affecting the market
for the Company's products. Obtaining the results expected from the introduction
of the Company's new products will require timely completion of development,
successful ramp-up of full-scale production on a timely basis and customer and
consumer acceptance of those products. In addition, the OEM agreements require
an ability to meet high quality and performance standards, successful
implementation of production at greatly increased volumes and an ability to
sustain production at greatly increased volumes, as to all of which there can be
no assurance. There also can be no assurance that products under development
will be successfully developed or that once developed such products will be
commercially successful.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company, as a result of its global operating and financial
activities, is exposed to changes in interest rates and foreign currency
exchange rates which may adversely affect its results of operations and
financial position. In seeking to minimize the risks and/or costs associated
with such activities, the Company manages exposures to changes in interest rates
and foreign currency rates through its regular operating and financing
activities. Each of the Company's foreign subsidiaries purchases its inventories
in U.S. Dollars and sells them in local currency, thereby creating an exposure
to fluctuations in foreign currency exchange rates. Certain components needed to
manufacture cameras are purchased in Japanese Yen. The impact of foreign
exchange transactions is reflected in the profit and loss statement. The
Company's hedging activities were immaterial and as of October 2, 1999 there
were no forward exchange contracts outstanding. The Company continues to analyze
the benefits and costs associated with hedging against foreign currency
fluctuations. The Company's exposure to changes in interest rates results from
its borrowing activities used to meet its liquidity needs. Long-term debt is
generally used to finance long-term investments, while short-term debt is used
to meet working capital requirements. Derivative instruments are not presently
used to adjust the Company's interest rate risk profile. The Company does not
utilize financial instruments for trading or speculative purposes, nor does it
utilize leveraged financial instruments.
10
<PAGE>
PART 2. OTHER INFORMATION
a. Item 6. Reports on Form 8-K
None
b. Exhibits
Exhibit No. Exhibit
- ----------- -------
3.1 Certificate of Incorporation of the Company, as amended
10.1 First Amendment to lease dated August 12, 1998 (the "Original
Lease") between the Company and CarrAmerica Realty Corporation
dated October 12, 1999.
27 Financial Data Schedule
11
<PAGE>
S I G N A T U R E
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.
CONCORD CAMERA CORP.
--------------------
(Registrant)
BY: /s/ Harlan I. Press
--------------------
(Signature)
Harlan I. Press
Corporate Controller and Assistant Secretary
DULY AUTHORIZED AND PRINCIPAL ACCOUNTING
OFFICER
DATE: November 10, 1999
12
<PAGE>
CERTIFICATE OF INCORPORATION
OF
CONCORD CAMERA CORP.
To: The Secretary of State
State of New Jersey
THE UNDERSIGNED over eighteen years of age, for the purpose of
forming a corporation pursuant to the provisions of Title 14A, Corporations,
General, of the New Jersey Statutes, does hereby execute the following
Certificate of Incorporation:
FIRST: The name of the corporation is CONCORD CAMERA CORP.
SECOND: The purposes for which the corporation is organized
are:
To engage in any activity within the lawful business purposes
for which corporations may be organized under the New Jersey Business
Corporation Act.
In general, to carry on any business in connection with the
foregoing, and to have and exercise all the powers conferred by Title 14A,
Corporations, General, Revised Statutes of New Jersey, and to do any or all of
the things hereinbefore set forth to the same extent as natural persons might
or could do, and in any par t of the world.
THIRD: The aggregate number of shares which the corporation
shall have authority to issue in Two Thousand Five Hundred (2,500), without
par value, all of which shall be Common Stock.
FOURTH: The address of the corporation's initial registered
office is 28 West State Street, Trenton, New Jersey and the name of the
corporation's initial registered at such address is The Corporation Trust
Company.
FIFTH: The number of directors constituting the initial board of
directors shall be two, and the names and addresses of the director are as
follows:
Names Addresses
----- ---------
Jack Benun P.O. Box 288, Allenhurst,
New Jersey 07111
Maurice J. Fischberg 2100 Linwood Avenue, Fort Lee,
New Jersey 07024
<PAGE>
SIXTH: The names and address of the sole incorporator is as
follows:
Name Address
Jack Benun P.O. Box 288, Allenhurst,
New Jersey 07111
IN WITNESS WHEREOF, I, the incorporator of the above-named corporation,
have hereunto signed this Certificate of Incorporation on the 28th day of
September, 1982.
_____________________________________________
Jack Benun
-2-
<PAGE>
FILED
APR 19, 1988
JANE BURGIO
Secretary of State
0436042
CERTIFICATE OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION OF
CONCORD CAMERA CORP.
To: The Secretary of State Federal EIN: 13-3152196
State of New Jersey
Pursuant to the provisions of Section 14A:9:2(4) and Section 14A:9-4(3),
Corporations, General, of the New Jersey Statutes, the undersigned corporation
executes the following Certificate of Amendment to its Certificate of
Incorporation:
The name of the corporation is CONCORD CAMERA CORP.
2. The following amendments to the Certificate of Incorporation were
approved by the directors and duly adopted by the shareholders of the
corporation on the 11th day of April, 1988:
RESOLVED, that ARTICLE THIRD of the Certificate of
Incorporation be amended to read as follows:
"THIRD: The aggregate number of shares which the
corporation shall have authority to issue is Ten (10,000,000), without
par value, all of which shall be Common Stock."
FURTHER RESOLVED, that Articles SEVENTH and EIGHTH be added to
the Certificate of Incorporation, each to read in their entirety, as
follows:
"SEVENTH: The corporation shall, to the fullest extent
permitted by Section 14A:3-5 of the New Jersey Business Corporation Act, as the
same may be amended and supplemented, indemnify any and all corporate
agents-whom it shall have-power to indemnify under said section from and against
any and all of the expenses liabilities, or other matters referred to in or
covered by said Section, and the indemnification provided for herein shall not
be deemed exclusive of any other rights to which those indemnified may be
entitled under any By-Law, agreement, vote of shareholders, or otherwise and
shall continue as to a person who has ceased to be a corporate agent and shall
inure to the benefit of the heirs, executors, administrators, and personal
representatives of such a corporate agent. The term "corporate agent" as used
herein shall have the meaning attributed to it by Sections 14A:3-5 and 14A:5-2l
of the New Jersey Business Corporation and by any other applicable provision of
law.
<PAGE>
EIGHTH: The personal liability of the directors of the
corporation is hereby limited to the fullest extent permitted by subsection
14A:2-7(3) of the New Jersey Business corporation Act, as the same may be
amended and supplemented."
3. The number of shares outstanding at the time of the adoption of the
amendment was 1,000. The total number of shares entitled to vote thereon was
1,000.
4. The number of shares voting for and against such amendment is as
follows:
Number of shares FOR amendment Number of shares AGAINST amendment
- ------------------------------ ----------------------------------
1000 0
Dated this 18th day of April, 1988.
CONCORD CAMERA CORP.
BY: ______________________________________
Jack Benun, President
<PAGE>
FILED
MAY 17, 1988
JANE SURGIO
Secretary of State
0443 163,
CERTIFICATE OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION OF
CONCORD CAMERA CORP.
To: The Secretary of State Federal EIN: 13-3152196
State of New Jersey
Pursuant to the provisions of Section 14A:9-2(4) and Section 14A:9-4(3),
Corporations, General, of the New Jersey Statutes, the undersigned corporation
executes the following Certificate of Amendment to its Certificate of
Incorporation:
1. The name of the corporation is CONCORD CAMERA CORP.
2. The following amendment to the Certificate of Incorporation was
approved by the directors and duly adopted by the shareholders of the
corporation on the 12th day of May, 1988:
RESOLVED, that ARTICLE NINTH be added to the Certificate of
Incorporation to read in its entirety as follows:
"NINTH: Each of the 1,000 Common Shares; without par value, of
the Corporation outstanding as of April 19, 1988, are hereby divided into 1,154
Common Shares, without par value. After giving effect to the stock split, the
total number of authorized shares of the Corporation will continue at
10,000,000."
3. The number of shares outstanding at the time of the adoption of the
amendment was 1,000. The total number of shares entitled to vote thereon was
1,000.
4. The number of shares voting for and against such amendment is as
follows:
Number of shares FOR amendment Number of shares AGAINST amendment
- ------------------------------ ----------------------------------
1,000 0
Dated this 12th day of May, 1988.
CONCORD CAMERA CORP.
BY:
_______________________________________
Jack C. Benun, President
<PAGE>
FILED
Jul 1, 1988
JANE SURGIO
Secretary of State
0457060,
CERTIFICATE OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION OF
CONCORD CAMERA CORP.
To: The Secretary of State Federal EIN: 13-3152196
State of New Jersey
Pursuant to the provisions of Section 14A:9-2(4) and Section 14A:9-4(3),
Corporations, General, of the Now Jersey Statutes, the undersigned corporation
executes the following Certificate of Amendment to its Certificate of
Incorporation:
1. The name of the corporation is CONCORD CAMERA CORP.
2. The following amendment to the Certificate of Incorporation was
approved by the directors and duly adopted by the shareholders of the
corporation on the 30th day of June, 19".
RESOLVED, that ARTICLE TENTH, relating to the removal of
directors of the Corporation, be added to the Certificate of
Incorporation to read in its entirety as follows:
"TENTH: one or more or all the directors of the Corporation may
be removed for cause by the shareholders by the affirmative vote of the
majority of the votes cast by the holders of shares entitled to vote f
or the election of directors; and one or more or all the directors may
be removed without cause by like vote of said shareholders. The Board
of Directors shall have the power to remove directors for cause and to
suspend directors pending a final determination that cause exists for
removal."
3. The number of shares outstanding at the time of the adoption of
the amendment was 1,154,000. The total number of shares entitled to vote
thereon was 1,154,000.
4. The number of shares voting for and against such amendment is as
follows:
Number of shares FOR amendment Number of shares AGAINST amendment
- ------------------------------ ----------------------------------
1,154,000 0
Dated this 30th day of June, 1988.
CONCORD CAMERA CORP.
BY: ________________________
Jack C. Benun, President
<PAGE>
FILED
DECEMBER 16, 1991
JOAN HABERLE
Secretary of State
0736683,
CERTIFICATE OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION OF
CONCORD CAMERA CORP.
To: The Secretary of State Federal EIN: 13-3152196
State of New Jersey
Pursuant to the provisions of Section 14A: 9-2 (4) and Section
14A9-4(3), of the New Jersey Business Corporation Act, the undersigned
corporation executes the following certificate of Amendment to its
Certificate of Incorporation:
1. The name of the corporation is CONCORD CAMERA CORP.
2. The following amendment to the Certificate of Incorporation was
approved by the corporation's Board of Directors an October 17,1991 and
duly adopted by the shareholders of the corporation on the 25th day of
November, 1991:
RESOLVED, that ARTICLE THIRD of the Certificate of
Incorporation be amended to read as set forth in its entirety
as follows:
"THIRD: The aggregate number of shares which the
corporation shall have authority to issue is Twenty million
(20,000,000), without par value, all of which shall be Common
Stock."
3. The total number of shares entitled to vote thereon was 5,098,395
shares.
4. The number of shares voting for and against such amendment are as
follows:
Number of shares FOR amendment Number of shares AGAINST amendment
------------------------------ ----------------------------------
2,995,023 81,128
Dated as of this 26th day of November, 1991.
CONCORD CAMERA CORP.
BY: _____________________________________
Jack Benun, President
<PAGE>
FILED
APRIL 28, 1997
LONNA R. HOOKS
Secretary of State
CERTIFICATE OF AMENDMENT TO THE
CERTIFICATE OF INCORPORATION OF
CONCORD CAMERA CORP.
To: The Secretary of State Federal EIN: 13-3152196
State of New Jersey
CERTIFICATE OF AMENDMENT (NO. 5) TO THE
CERTIFICATE OF INCORPORATION OF
CONCORD CAMERA CORP.
Pursuant to the provisions of Section 14A:9-2(4) and Section
14A:9-4(3), of the New Jersey Business corporation Act, the undersigned
corporation executes the following Certificate of Amendment to its Certificate
of Incorporation:
1. The name of the corporation is CONCORD CAMERA CORP.
2. The following amendment to the Certificate of Incorporation
was approved by the corporation's Board of Directors on
December 17, 1995 and duly adopted by the shareholders of the
corporation on April 17, 1997:
RESOLVED, that ARTICLE THIRD OF THE Certificate of
Incorporation be amended to read and set forth in its entirety
as follows:
"THIRD: The aggregate number of shares which the corporation
shall have authority to issue is Forty Million (40,000,000),
without per value, all of which shall be Common Stock."
3. The total number of shares entitled to vote thereon was
shares.
4. The number of shares voting for and against such amendment are
as follows:
Number of shares FOR amendment Number of shares AGAINST amendment
------------------------------ ----------------------------------
5,924,130 1,383,181
Dated as of this 18th day of April, 1997
CONCORD CAMERA CORP.
By: ______________________________
Name: Ira B. Lampert
Title: Chief Executive Officer
<PAGE>
FIRST AMENDMENT TO LEASE
- --------------------------------------------------------------------------------
THIS FIRST AMENDMENT TO LEASE is dated this __12th_ day of October_____________
1999 by and between CarrAmerica Realty Corporation, a Maryland corporation
("Landlord") and Concord Camera Corp., a New Jersey corporation ("Tenant")
BACKGROUND
1. Landlord and Tenant entered into a certain lease dated as of August 12, 1998
(the "Original Lease") pursuant to which Tenant leases from Landlord suite 650-N
(the "Original Premises") and located in the building known as Presidential
Circle (the "Building") at 4000 Hollywood Boulevard, Hollywood, Florida, 33021.
The Original Lease and this First Amendment shall be collectively referred to as
the "Lease".
AT THIS TIME, Tenant and Landlord wish to expand the Original Premises and
extend the term of the lease.
AGREEMENT
1. EXPANSION SPACE:
Suite 630-N consisting 1,924 rentable square feet (the "Expansion
Space") located within the Building.
2. EXPANSION SPACE COMMENCEMENT DATE:
January 4, 2000, but if the Expansion Space is subject to new
construction pursuant to section 5 of this First Amendment, then the Completion
Date, as defined therein, if it is later; Landlord and Tenant shall execute a
Commencement Date Confirmation for the Expansion Space substantially in the form
of Appendix E of the Original Lease promptly following the Expansion Space
Commencement Date
3. EXPANSION SPACE TERMINATION DATE/EXPANSION SPACE TERM:
One hundred and twenty (120) months after the Expansion Space
Commencement Date, or if the Expansion Space Commencement Date is not the first
day of a month, then one hundred and twenty (120) months after the first day of
the following month. The Termination Date, as defined in the Original Lease for
the Original Premises, shall be extended and shall terminate on the Expansion
Space Termination Date
4. EXPANSION SPACE BASE RENT:
Tenant shall pay Base Rent for the Expansion Space according to the
same corresponding per square foot rates as Tenant pays for the Original
Premises. The schedule of Base Rent per square foot in the Original Lease is as
follows:
Per Square Foot
Period Base Rent
------ ---------------
January 4, 1999 to January 31, 2000 $15.70
February 1, 2000 to January 31, 2001 16.33
February 1, 2001 to January 31, 2002 16.98
February 1, 2002 to January 31, 2003 17.66
February 1, 2003 to January 31, 2004 18.37
February 1, 2004 to January 31, 2005 19.10
February 1, 2005 to January 31, 2006 19.87
February 1, 2006 to January 31, 2007 20.66
February 1, 2007 to January 31, 2008 21.49
February 1, 2008 to January 31, 2009 22.35
<PAGE>
Because the Expansion Space Term shall extend beyond that shown in the
above schedule, and thus the Original Lease, the Base Rent for the Original
Premises and the Expansion Space shall continue to increase at a rate of 4% per
annum each anniversary.
THIS FIRST AMENDMENT TO LEASE is by and between CarrAmerica Realty Corporation,
a Maryland corporation ("Landlord") and Concord Camera Corp., a New Jersey
corporation ("Tenant")
5. OPERATING COST SHARE RENT:
During the calendar year 1999, Tenant acknowledges that the estimated
amount of Operating Costs as referred to in Paragraph 2.B & 2.C of the Original
Lease are $9.77 per rentable square foot plus applicable tax. Tenant shall
continue to pay Operating Cost Share Rent according to the terms of the lease
for the Original Premises and the Expansion Space.
6. TENANT IMPROVEMENTS
A. INITIAL IMPROVEMENTS. Landlord shall cause to be performed the
improvements (the "Initial Improvements") in the Expansion Space in accordance
with plans and specifications approved by Tenant and Landlord (the "Plans"),
which approvals shall not be unreasonably withheld. The Initial Improvements
shall be performed at the Tenant's cost, subject to the Landlord's Contribution
(hereinafter defined).
Tenant shall cause the Plans to be prepared by a registered
professional architect, and mechanical and electrical engineer(s). Such
engineer(s) shall be approved in advance by the Landlord. Prior to
close-of-business ten (10) days after full execution and delivery of this First
Amendment to Tenant. Tenant shall furnish the initial draft of the Plans to
Landlord for Landlord's review and approval. Landlord shall within two (2) weeks
after receipt either provide comments to such Plans or approve the same.
Landlord shall be deemed to have approved such Plans if it does not timely
provide comments on such Plans. If Landlord provides Tenant with comments to the
initial draft of the Plans, Tenant shall provide revised Plans to Landlord
incorporating Landlord's comments within one week after receipt of Landlord's
comments. Landlord shall within one week after receipt then either provide
comments to such revised Plans or approve such Plans. Landlord shall be deemed
to have approved such revised Plans if Landlord does not timely provide comments
on such Plans. The process described above shall be repeated, if necessary,
until the Plans have been finally approved by Landlord. Tenant hereby agrees
that the Plans for the Initial Improvements shall comply with all applicable
Governmental Requirements. Landlord's approval of any of the Plans (or any
modifications or changes thereto) shall not impose upon Landlord or its agents
or representatives any obligation with respect to the design of the Initial
Improvements or the compliance of such Initial Improvements or the Plans with
applicable Governmental Requirements.
Landlord, with consultation of Tenant, shall select a contractor to
perform the construction of the Initial Improvements. Such contractor shall be
selected by a competitive bid process between three contractors selected by
Landlord, with consultation of Tenant. Landlord shall use commercially
reasonable efforts to cause the Initial Improvements to be substantially
completed, except for minor "Punch List" items, on or before the Expansion Space
Commencement Date specified in Section 2 of this First Amendment, subject to
Tenant Delay (hereafter defined) and Force Majeure.
<PAGE>
Landlord, or an agent of Landlord, shall provide project management
services in connection with the construction of the Initial Improvements and the
Change Orders (hereinafter defined). Such project management services shall be
performed, at Tenant's cost, for a fee of five percent (5%) of all costs related
to the preparation of the Plans and the construction of the Initial Improvements
and the Change Orders.
B. CHANGE ORDERS. If, prior to the Expansion Space Commencement Date,
Tenant shall require improvements or changes (individually or collectively,
"Change Orders") to the Expansion Space in addition to, revision of, or
substitution for the Initial Improvements, Tenant shall deliver to Landlord for
its approval plans and specifications for such Change Orders. If Landlord does
not approve of the plans for Change Orders, Landlord shall advise Tenant of the
revisions required. Tenant shall revise and redeliver the plans and
specifications to Landlord within five (5) business days of Landlord's advice or
Tenant shall be deemed to have abandoned its request for such Change Orders.
Tenant shall pay for all preparations and revisions of plans and specifications,
and the construction of all Change Orders, subject to Landlord's Contribution.
C. LANDLORD'S CONTRIBUTION. Landlord shall contribute an amount not to
exceed $26,551.20 ("Landlord's Contribution") toward the costs incurred for the
Initial Improvements and Change Orders. Landlord has no obligation to pay for
costs of the Initial Improvements or Change Orders in excess of Landlord's
Contribution. If the cost of the Initial Improvements and/or Change Orders
exceeds the Landlord's Contribution, Tenant shall pay such overage to Landlord
prior to commencement of construction of the Initial Improvements and/or Change
Orders.
D. COMMENCEMENT DATE DELAY. Expansion Space Commencement Date shall be
delayed until the Initial Improvements have been substantially completed as
evidenced by a certificate of occupancy issued by the appropriate governmental
authority (the "Completion Date"), except to the extent that the delay shall be
caused by any one or more of the following (a "Tenant Delay"):
(a) Tenant's request for Change Orders whether or not any such Change
Orders are actually performed; or
(b) Contractor's performance of any Change Orders; or
THIS FIRST AMENDMENT TO LEASE is by and between CarrAmerica Realty Corporation,
a Maryland corporation ("Landlord") and Concord Camera Corp., a New Jersey
corporation ("Tenant")
(c) Tenant's request for materials, finishes or installations requiring
unusually long lead times; or
(d) Tenant's delay in reviewing, revising or approving plans and
specifications beyond the periods set forth herein; or
(e) Tenant's delay in providing information critical to the normal
progression of the project. Tenant shall provide such information as soon as
reasonably possible, but in no event longer than one week after receipt of such
request for information from the Landlord; or
(f) Tenant's delay in making payments to Landlord for costs of the
Initial Improvements and/or Change Orders in excess of the Landlord's
Contribution; or
(g) Any other act or omission by Tenant, its agents, contractors or
persons employed by any of such persons. If the Commencement Date is delayed for
any reason, then Landlord shall cause Landlord's Architect to certify the date
on which the Initial Improvements would have been completed but for such Tenant
Delay, or were in fact completed without any Tenant Delay.
E. ACCESS BY TENANT PRIOR TO COMMENCEMENT OF EXPANSION SPACE TERM.
Landlord at its discretion may permit Tenant and its agents to enter the
Expansion Space prior to the Expansion Space Commencement Date to prepare the
Expansion Space for Tenant's use and occupancy. Any such permission shall
constitute a license only, conditioned upon Tenant's:
(a) working in harmony with Landlord and Landlord's agents,
contractors, workmen, mechanics and suppliers and with other tenants and
occupants of the Building;
(b) obtaining in advance Landlord's approval of the contractors
proposed to be used by Tenant and depositing with Landlord in advance of any
work (i) security satisfactory to Landlord for the completion thereof, and (ii)
the contractor's affidavit for the proposed work and the waivers of lien from
the contractor and all subcontractors and suppliers of material; and
<PAGE>
(c) furnishing Landlord with such insurance as Landlord may require
against liabilities which may arise out of such entry.
Landlord shall have the right to withdraw such license for any reason
upon twenty-four (24) hours' written notice to Tenant. Landlord shall not be
liable in any way for any injury, loss or damage which may occur to any of
Tenant's property or installations in the Expansion Space prior to the Expansion
Space Commencement Date. Tenant shall protect, defend, indemnify and save
harmless Landlord from all liabilities, costs, damages, fees and expenses
arising out of the activities of Tenant or its agents, contractors, suppliers or
workmen in the Expansion Space or the Building. Any entry and occupation
permitted under this Section shall be governed by Section 5 and all other terms
of the Lease.
7. ADDITIONAL PARKING FOR THE EXPANSION SPACE
Subject to the terms described in Section 31 of the Original Lease.
Total Parking Spaces Seven (7)
Garage Parking Spaces * Two (2)
Surface Parking Spaces Five (5)
* Initial monthly rate of $40.00 per parking space.
8. STATUS OF LEASE
Landlord and Tenant hereby acknowledge and agree that: (i) as of the
date hereof, Landlord has complied with all of the terms an conditions of the
Original Lease, and that Tenant has no rights to any credit, claim, cause of
action, offset or similar charge against Landlord, the Base Rent and/or the
Additional Rent, each of same, if any, existing as of the date hereof, now being
waived by Tenant; (ii) Landlord has fully performed all of its obligations under
the Original Lease and is not obligated to make or pay for any additional tenant
improvements except for those tenant improvements specifically set forth in this
First Amendment; (iii) Tenant represents and warrants to Landlord that there are
no assignees, sublessees or transferees of the Original Lease, or any part
hereof, or any person or firm (other than Tenant) occupying or having the right
in the future to occupy the Original Premises or the Expansion Space, or any
part thereof; not previously approved by Landlord (iv) Tenant has no right to
any credit, claim, cause of action, offset or similar charge against Landlord or
against the Rent or any other charges due to Landlord under the Lease; (v)
Landlord and Tenant confirm that from the Expansion Space Commencement Date
until the Expansion Space Termination Date, the Original Premises and the
Expansion Space shall consist of 12,069 rentable square feet; the square footage
of the Original Premises, Expansion Space and the Building set forth in the this
First Amendment and the Original lease are conclusively deemed to be the actual
square footage thereof, without regard to any subsequent remeasurement of the
Original Premises, Expansion Space or the Building; (vi) Tenant is not entitled
to any future rental abatement, concession, credit or reduction; (vii) except
for this First Amendment, the Original Lease has not been modified in any
respect; and (viii) by this First Amendment the Lease is currently scheduled to
terminate on Expansion Space Termination Date.
THIS FIRST AMENDMENT TO LEASE is by and between CarrAmerica Realty Corporation,
a Maryland corporation ("Landlord") and Concord Camera Corp., a New Jersey
corporation ("Tenant")
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment.
LANDLORD:
CARRAMERICA REALTY CORPORATION., a
Maryland corporation
___________________
Witness By: ____________________________________
Print Name: _____________________________
Title:___________________________________
___________________
Witness
Date:___________________________________
TENANT:
Concord Camera Corp., a New Jersey
corporation
___________________
Witness By: ____________________________________
Print Name: _____________________________
Title:___________________________________
___________________
Witness
Date:___________________________________
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Concord
Camera Corp.'s Consolidated financial statements as of October 2, 1999 and the
results of operations for the three months ended October 2, 1999 and is
qualified in its entiriety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-02-1999
<PERIOD-END> OCT-02-1999
<CASH> 33,984,199
<SECURITIES> 0
<RECEIVABLES> 19,944,788
<ALLOWANCES> (647,264)
<INVENTORY> 22,268,314
<CURRENT-ASSETS> 78,448,679
<PP&E> 39,240,367
<DEPRECIATION> (19,412,502)
<TOTAL-ASSETS> 103,650,559
<CURRENT-LIABILITIES> 38,617,937
<BONDS> 14,850,000
0
0
<COMMON> 41,168,585
<OTHER-SE> 4,931,544
<TOTAL-LIABILITY-AND-EQUITY> 103,650,559
<SALES> 41,237,897
<TOTAL-REVENUES> 41,237,897
<CGS> 29,899,118
<TOTAL-COSTS> 7,194,447
<OTHER-EXPENSES> (128,294)
<LOSS-PROVISION> 7,581
<INTEREST-EXPENSE> 747,517
<INCOME-PRETAX> 4,272,626
<INCOME-TAX> 377,000
<INCOME-CONTINUING> 4,272,626
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,272,626
<EPS-BASIC> 0.36
<EPS-DILUTED> 0.33
</TABLE>
