FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT
FOR THE QUARTER ENDED: COMMISSION FILE NUMBER:
JULY 29, 2000 0-21258
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CHICO'S FAS, Inc.
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(Exact name of registrant as specified in charter)
FLORIDA 59-2389435
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(State of Incorporation) (I.R.S. Employer Identification No.)
11215 METRO PARKWAY, FORT MYERS, FLORIDA 33912
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(Address of principal executive offices)
941-277-6200
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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, 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 practical date.
At August 28th, there were 17,437,830 shares outstanding of Common Stock, $.01
par value per share.
<PAGE>
CHICO'S FAS, Inc.
Index
PART I - FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS (UNAUDITED):
Condensed Consolidated Balance Sheets - July 29, 2000 and
January 29, 2000_______________________________________________ 3
Condensed Consolidated Statements of Income for the
Thirteen and Twenty-Six Weeks Ended
July 29, 2000 and July 31, 1999________________________________ 4
Condensed Consolidated Statements of Cash Flows for the
Twenty-Six Weeks Ended July 29, 2000 and
July 31, 1999__________________________________________________ 5
Notes to Condensed Consolidated Financial Statements_________________ 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS_______________________________________ 7
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK___________ 11
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS_________________ 11
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K____________________________________ 12
Signatures___________________________________________________________________ 12
2
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<PAGE>
CHICO'S FAS, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Unaudited)
<TABLE>
<CAPTION>
AS OF AS OF
07-29-00 01-29-00
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<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 3,829,580 $ 3,980,930
Marketable securities, at market 19,133,617 13,995,527
Receivables, net 1,944,146 1,706,661
Inventories 21,449,962 14,834,800
Prepaid expenses 1,667,686 668,695
Deferred taxes 2,785,000 2,038,000
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TOTAL CURRENT ASSETS 50,809,991 37,224,613
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LAND, BUILDING AND EQUIPMENT:
Cost 56,803,901 41,217,160
Less accumulated depreciation and amortization (11,930,734) (9,872,163)
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LAND, BUILDING AND EQUIPMENT, NET 44,873,167 31,344,997
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OTHER ASSETS:
Deferred taxes 1,363,000 1,106,000
Other assets, net 631,885 640,211
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TOTAL OTHER ASSETS 1,994,885 1,746,211
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$ 97,678,043 $ 70,315,821
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 12,564,037 $ 5,982,684
Accrued liabilities 7,426,302 4,593,104
Current portion of debt and lease obligations 275,247 260,111
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TOTAL CURRENT LIABILITIES 20,265,586 10,835,899
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NONCURRENT LIABILITIES:
Notes and capital leases payable 5,185,500 5,221,500
Deferred rent 1,774,265 1,617,680
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TOTAL NONCURRENT LIABILITIES 6,959,765 6,839,180
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STOCKHOLDERS' EQUITY:
Common stock 174,263 171,285
Additional paid-in capital 17,627,740 14,709,238
Unrealized gain (loss) on marketable securities 12,790 (24,334)
Retained earnings 52,637,899 37,784,553
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TOTAL STOCKHOLDERS' EQUITY 70,452,692 52,640,742
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$ 97,678,043 $ 70,315,821
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</TABLE>
SEE ACCOMPANYING NOTES
3
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CHICO'S FAS, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(Unaudited)
<TABLE>
<CAPTION>
TWENTY-SIX WEEKS ENDED THIRTEEN WEEKS ENDED
07-29-00 07-31-99 07-29-00 07-31-99
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<S> <C> <C> <C> <C>
Net sales by Company stores $115,255,264 $ 71,913,385 $ 59,572,855 $ 36,192,085
Net sales to Franchisees 2,075,866 1,282,889 1,065,461 579,208
------------ ------------ ------------ ------------
NET SALES 117,331,130 73,196,274 60,638,316 36,771,293
Cost of goods sold 48,407,946 30,394,972 25,643,952 15,494,349
------------ ------------ ------------ ------------
GROSS PROFIT 68,923,184 42,801,302 34,994,364 21,276,944
General, administrative and
store operating expenses 45,235,343 29,679,614 23,267,122 14,954,637
------------ ------------ ------------ ------------
INCOME FROM OPERATIONS 23,687,841 13,121,688 11,727,242 6,322,307
Interest income, net 268,505 44,431 171,184 42,359
------------ ------------ ------------ ------------
INCOME BEFORE TAXES 23,956,346 13,166,119 11,898,426 6,364,666
Income tax provision 9,103,000 5,003,000 4,521,000 2,418,000
------------ ------------ ------------ ------------
NET INCOME $ 14,853,346 $ 8,163,119 $ 7,377,426 $ 3,946,666
============ ============ ============ ============
PER SHARE DATA:
Net income per common share - basic $ 0.86 $ 0.48 $ 0.43 $ 0.23
============ ============ ============ ============
Net income per common and common
equivalent share - diluted $ 0.83 $ 0.46 $ 0.41 $ 0.22
============ ============ ============ ============
Weighted average common shares
outstanding - basic 17,218,987 16,847,146 17,293,448 16,884,584
============ ============ ============ ============
Weighted average common and common
equivalent shares outstanding - diluted 17,966,178 17,582,042 18,076,725 17,617,638
============ ============ ============ ============
</TABLE>
SEE ACCOMPANYING NOTES
4
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CHICO'S FAS, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
TWENTY-SIX WEEKS ENDED
07-29-00 07-31-99
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 14,853,346 $ 8,163,119
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Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization 2,453,241 1,464,529
Deferred taxes (1,004,000) (362,000)
Loss on disposal of land, building and equipment 193,255 112,206
Deferred rent expense, net 156,585 99,944
Changes in assets and liabilities:
Increase in receivables, net (237,485) (668,194)
Increase in inventories (6,615,162) (2,328,328)
Increase in prepaid expenses and other assets (1,028,125) (298,288)
Increase in accounts payable 6,581,353 2,784,851
Increase (decrease) in accrued liabilities 2,848,334 (237,072)
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Total adjustments 3,347,996 567,648
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Net cash provided by operating activities 18,201,342 8,730,767
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of marketable securities, net (5,100,966) (12,678,466)
Purchase of land, building and equipment (16,122,206) (5,266,205)
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Net cash used in investing activities (21,223,172) (17,944,671)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuances of common stock 2,921,480 861,031
Principal payments on debt (36,000) (96,273)
Purchase of intangible assets (15,000) --
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Net cash provided by financing activities 2,870,480 764,758
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Net decrease in cash and cash equivalents (151,350) (8,449,146)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 3,980,930 14,484,776
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CASH AND CASH EQUIVALENTS - END OF PERIOD $ 3,829,580 $ 6,035,630
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</TABLE>
SEE ACCOMPANYING NOTES
5
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CHICO'S FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
July 29, 2000
(Unaudited)
ITEM 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements
of Chico's FAS, Inc. and its wholly-owned subsidiaries (collectively, "Chico's"
or the "Company") have been prepared in accordance with the instructions to Form
10-Q and do not include all of the information and notes required by accounting
principles generally accepted in the U.S. 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. All
significant intercompany balances and transactions have been eliminated in
consolidation. For further information, refer to the financial statements and
notes thereto for the fiscal year ended January 29, 2000, included in the
Company's Annual Report on Form 10-K filed on April 28, 2000. The January 29,
2000 balance sheet amounts were derived from audited financial statements
included in the Company's Annual Report.
Operating results for the thirteen and twenty-six weeks ended July 29,
2000 are not necessarily indicative of the results that may be expected for the
entire year. All per share data for the prior year has been restated to reflect
the two-for-one split effective in January 2000.
NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE
Basic EPS is based upon the weighted average number of common shares
outstanding and diluted EPS is based upon the weighted average number of common
shares outstanding plus the dilutive common equivalent shares outstanding during
the period. The following is a reconciliation of the denominators of the basic
and diluted EPS computations shown on the face of the accompanying statements of
income:
<TABLE>
<CAPTION>
TWENTY-SIX WEEKS ENDED THIRTEEN WEEKS ENDED
07-29-00 07-31-99 07-29-00 07-31-99
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<S> <C> <C> <C> <C>
Basic weighted average outstanding
common shares 17,218,987 16,847,146 17,293,448 16,884,584
Dilutive effect of options outstanding 747,191 734,896 783,277 733,054
---------- ---------- ---------- ----------
Diluted weighted average common and
common equivalent shares outstanding 17,966,178 17,582,042 18,076,725 17,617,638
========== ========== ========== ==========
</TABLE>
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS - THIRTEEN WEEKS ENDED JULY 29, 2000 COMPARED TO THE
THIRTEEN WEEKS ENDED JULY 31, 1999.
NET SALES. Net sales by Company-owned stores for the thirteen weeks
ended July 29, 2000 (the current period) increased by $23.4 million, or 64.6%,
over net sales by Company-owned stores for the comparable thirteen weeks ended
July 31, 1999 (the prior period). The increase was the result of a comparable
Company store net sales increase of $12.2 million, $11.0 million additional
sales from the new stores not yet included in the Company's comparable store
base (net of sales of approximately $332,000 from three stores closed in fiscal
2000 and fiscal 2001), and approximately $203,000 of net sales from the
Company's call center (website and mailer sales) which began operations in late
May 2000.
Net sales to franchisees for the current period increased by
approximately $486,000 or 84.0% compared to net sales to franchisees for the
prior period. The increase in net sales to franchisees was primarily due to a
net increase in purchases by the franchisees as a whole and the opening of one
additional franchised location in fiscal 2001 by an existing franchisee.
GROSS PROFIT. Gross profit for the current period was $35.0 million, or
57.7% of net sales, compared with $21.3 million, or 57.9% of net sales, for the
prior period. The decrease in the gross profit percentage resulted from a
substantial decline in gross margins in the Company's seven outlet locations and
to a lesser degree, an increase in the Company's distribution center, product
development and merchandising costs, net of improved initial markups on its
products.
GENERAL, ADMINISTRATIVE AND STORE OPERATING EXPENSES. General,
administrative and store operating expenses increased to $23.3 million, or 38.3%
of net sales, in the current period from $15.0 million, or 40.7% of net sales,
in the prior period. The increase in general, administrative and store operating
expenses was, for the most part, the result of increases in store operating
expenses, including store compensation, occupancy and other costs associated
with additional store openings. The decrease in these expenses as a percentage
of net sales was principally due to leverage associated with the Company's 34.3%
comparable Company store sales increase for the current period, net of an
increase in marketing expenses as a percentage of net sales.
INTEREST INCOME, NET. The Company had net interest income during the
current period of approximately $171,000 versus approximately $42,000 in the
prior period. The increase in net interest income was primarily a result of the
Company's increased cash and marketable securities position, as well as improved
interest rates on cash and marketable securities.
NET INCOME. As a result of the factors discussed above, net income
reflects an increase of 86.9% to $7.4 million in the current period from net
income of $3.9 million in the prior period. The income tax provision represented
an effective rate of 38.0% for the current and prior period.
7
<PAGE>
RESULTS OF OPERATIONS - TWENTY-SIX WEEKS ENDING JULY 29, 2000 COMPARED TO THE
TWENTY-SIX WEEKS ENDED JULY 31, 1999.
NET SALES. Net sales by Company-owned stores for the twenty-six weeks
ended July 29, 2000 (the current period) increased by $43.3 million, or 60.3%,
over net sales by Company-owned stores for the comparable twenty-six weeks ended
July 31, 1999 (the prior period). The increase was the result of a comparable
Company store net sales increase of $23.0 million, $20.1 million additional
sales from the new stores not yet included in the Company's comparable store
base (net of sales of approximately $643,000 from five stores closed in fiscal
2000 and fiscal 2001), and approximately $203,000 of net sales from the
Company's call center (website and mailer phone sales) which began operations in
late May 2000.
Net sales to franchisees for the current period increased by
approximately $793,000 or 61.8% compared to net sales to franchisees for the
prior period. The increase in net sales to franchisees was primarily due to a
net increase in purchases by the franchisees as a whole and the opening by an
existing franchisee of one additional franchised location in each of fiscal 2001
and fiscal 2000.
GROSS PROFIT. Gross profit for the current period was $68.9 million, or
58.7% of net sales, compared with $42.8 million, or 58.5% of net sales, for the
prior period. The increase in the gross profit percentage resulted from reduced
markdowns and improved initial markups in the current period versus the prior
period, net of additional mailer-related promotional activities and increased
volume of discounts, including those associated with expanding the Company's
frequent shopper club (the "Passport Club") which was relaunched in the first
quarter of last year, and net of a decline in the gross margins in the Company's
seven outlet locations.
GENERAL, ADMINISTRATIVE AND STORE OPERATING EXPENSES. General,
administrative and store operating expenses increased to $45.2 million, or 38.6%
of net sales, in the current period from $29.7 million, or 40.5% of net sales,
in the prior period. The increase in general, administrative and store operating
expenses was, for the most part, the result of increases in store operating
expenses, including store compensation, occupancy and other costs associated
with additional store openings. The decrease in these expenses as a percentage
of net sales was principally due to leverage associated with the Company's 32.7%
comparable Company store sales increase for the current period, net of an
increase in marketing expenses as a percentage of sales.
INTEREST INCOME, NET. The Company had net interest income during the
current period of approximately $269,000 versus approximately $44,000 in the
prior period. The increase in net interest income was primarily a result of the
Company's increased cash and marketable securities position, as well as improved
interest rates on cash and marketable securities.
NET INCOME. As a result of the factors discussed above, net income
reflects an increase of 82.0% to $14.9 million in the current period from net
income of $8.2 million in the prior period. The income tax provision represented
an effective rate of 38% for the current and prior period.
8
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COMPARABLE COMPANY STORE NET SALES
Comparable Company store net sales increased by 34.3% in the current
quarter and 32.7% in the first six months of this fiscal year when compared to
the comparable prior periods. Comparable Company store net sales data is
calculated based on the change in net sales of currently open Company-owned
stores that have operated as a Company store for at least thirteen months.
The Company believes that the increase in comparable Company store net
sales in the current quarter resulted from the continuing effort to focus the
Company's product development, merchandise planning, buying and marketing
departments on Chico's target customer. The Company also believes that the look,
fit and pricing policy of the Company's product was in line with the needs of
our target customer and that the increase in comparable stores sales was also
fueled by increased direct mailings, a larger database of existing customers for
such mailings and the success of the Company's frequent shopper club (the
"Passport Club"). To a lesser degree, the Company believes the increase was due
to increased store-level training efforts associated with ongoing training
programs and continuing strong sales associated with several styles of clothing
produced from a related group of fabrics introduced by the Company in the fourth
quarter of fiscal 1998.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary ongoing capital requirements are for funding
capital expenditures for new store openings and merchandise inventory purchases.
In addition, over the past six months and continuing over the next twelve
months, the Company has experienced and anticipates continuing to experience the
need for capital to address expansions of its office and design facility at its
headquarters facilities, the chain-wide roll out of new point-of-sale devices
and the development of infrastructure, including internal call and fulfillment
centers, to support the Company's planned expansion into catalog and Internet
sales.
During the first two quarters of the current fiscal year (fiscal 2001)
and the first two quarters of the prior fiscal year (fiscal 2000), the Company's
primary source of working capital was cash flow from operations of $18.2 million
and $8.7 million, respectively. The increase in cash flow from operations of
$9.5 million was primarily due to an increase of $6.7 million in net income, an
increase of $9.4 million in accounts payable and accrued liabilities, and an
increase of $1.0 million in depreciation and amortization, net of an increase in
inventories of $6.6 million, and an increase in deferred taxes of $1.0 million.
The increase in accounts payable and inventories is associated with increased
fabric purchases (which generally have an extended payment due date) and other
required increased inventory purchase activities to support the Company's
significant sales increases.
The Company invested $16.1 million in the first two quarters of the
current fiscal year for capital expenditures. The capital expenditures for the
first two quarters of the current fiscal year included $9.7 million primarily
associated with the planning and opening of new Company stores, and the
remodeling/relocating/expansion of numerous existing stores, $2.5 million for
new point-of-sale devices, approximately $2.4 million for the expansion of its
office and design facilities, and approximately $1.5 million for the development
of infrastructure associated with catalog and Internet sales. During the same
period in the prior fiscal year, the Company invested $5.3 million primarily for
capital expenditures associated with the opening of new Company stores, and the
remodeling of several existing stores.
9
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LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)
During the first two quarters of the current fiscal year, the Company
invested an additional $5.1 million in high quality tax free municipal bonds in
an effort to improve the after-tax interest earnings from its increased cash and
marketable securities position.
During the first two quarters of the current fiscal year, two of the
Company's officers and its three independent directors exercised 248,735 stock
options at prices ranging from $1.625 to $11.344 and several employees and
former employees exercised 35,892 options at prices ranging from $1.625 to
$11.344. Also during this period, the Company sold 13,155 shares of common stock
under its employee stock purchase plan at a price of $15.25. The proceeds from
these issuances of stock, together with the tax benefit recognized by the
Company, amounted to approximately $2.9 million.
As more fully described in "Item 1-Business" beginning on page 13 of
the Company's Annual Report on Form 10-K for the fiscal year ended January 29,
2000, the Company is subject to ongoing risks associated with imports. The
Company's reliance on sourcing from foreign countries causes the Company to be
exposed to certain unique business and political risks. Import restrictions,
including tariffs and quotas, and changes in such tariffs or quotas could affect
the importation of apparel generally and, in that event, could increase the cost
or reduce the supply of apparel available to the Company and have an adverse
effect on the Company's business, financial condition and/or results of
operations. The Company's merchandise flow could also be adversely affected by
political instability in any of the countries in which its goods are
manufactured, by significant fluctuations in the value of the U.S. dollar
against applicable foreign currencies and by restrictions on the transfer of
funds.
The Company plans to open between 45 and 50 Company-owned new stores in
fiscal 2001, 20 of which were open as of August 28, 2000. The Company believes
that the liquidity needed for its planned new store growth, continuing
remodel/expansion program, maintenance of proper inventory levels associated
with this growth, expansion of its office and design facilities and
establishment of catalog and Internet sales activities will be funded primarily
from cash flow from operations and its strong existing cash balances. The
Company further believes that this liquidity will be sufficient, based on
currently planned new store openings, to fund anticipated capital needs over the
near-term, including scheduled debt repayments. In further support of its
liquidity needs, the Company expanded its line of credit and letter of credit
facilities to $25 million, effective May 2000. Given the Company's existing cash
and marketable securities balances and the capacity included in its newly
expanded bank credit facilities, the Company does not believe that it would need
to seek other sources of financing to conduct its operations or pursue its
expansion plans even if cash flow from operations should prove to be less than
anticipated or even if there should arise a need for additional letter of credit
capacity due to establishing new and expanded sources of supply, or if the
Company were to increase the number of new Company stores planned to be opened
in future periods.
SEASONALITY AND INFLATION
Although the operations of the Company are influenced by general
economic conditions, the Company does not believe that inflation has had a
material effect on the results of operations during the current or prior
periods. The Company does not consider its business to be seasonal.
10
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CERTAIN FACTORS THAT MAY AFFECT FUTURE RESULTS
This 10-Q may contain forward-looking statements which reflect the
current views of the Company with respect to certain events that could have an
effect on the Company's future financial performance. These statements include
the words "expects", "believes", and similar expressions. These forward-looking
statements are subject to various risks and uncertainties that could cause
actual results to differ materially from historical results or those currently
anticipated. These potential risks and uncertainties include ability to secure
customer acceptance of Chico's styles, propriety of inventory mix and sizing,
quality of merchandise received from vendors, timeliness of vendor production
and deliveries, increased competition, extent of the market demand by women for
private label clothing and related accessories, adequacy and perception of
customer service, ability to coordinate product development along with buying
and planning, rate of new store openings, performance of management information
systems, ability to hire, train, energize and retain qualified sales associates
and other employees, availability of quality store sites, ability to hire and
retain qualified managerial employees, ability to effectively and efficiently
establish and operate catalog and Internet sales activities and other risks. In
addition, there are potential risks and uncertainties that are peculiar to the
Company's heavy reliance on sourcing from foreign vendors including the impact
of work stoppages, transportation delays and other interruptions, political
instability, foreign currency fluctuations, imposition of and changes in tariffs
and import and export controls such as import quotas, changes in governmental
policies in or towards such foreign countries and other similar factors.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The market risk of the Company's financial instruments as of July 29,
2000 has not significantly changed since April 29, 2000. The Company is exposed
to market risk from changes in interest rates on its indebtedness. The Company's
exposure to interest rate risk relates in part to its revolving line of credit
with its bank; however, as of July 29, 2000, the Company did not have any
outstanding balance on its line of credit and, given its existing liquidity
position, does not expect to utilize its line of credit in the foreseeable
future except for its continuing use of the letter of credit facility portion
thereof. The Company's exposure to interest rate risk also relates to its $5.3
million mortgage loan indebtedness which bears a variable interest rate based
upon changes in the prime rate.
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Meeting of Shareholders of the Company was held on June 13, 2000.
There were 17,180,936 shares of common stock entitled to a vote. The following
matters were voted upon at the meeting:
<TABLE>
<CAPTION>
a) Election of Directors: VOTES FOR VOTES WITHHELD
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CLASS I - TERM EXPIRING IN 2003
-------------------------------
<S> <C> <C>
Charles J. Kleman 15,683,199 276,295
Ross E. Roeder 15,865,809 93,685
</TABLE>
11
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b) Board of Directors proposal to ratify the appointment of Arthur
Andersen LLP as independent certified public accountants for
fiscal year 2001.
Voting Results: For the Proposal 15,942,909
Against the Proposal 12,176
Abstentions 4,409
c) Board of Directors proposal to ratify amendments to the
Non-Employee Directors' Stock Option Plan
Voting Results: For the Proposal 14,649,166
Against the Proposal 1,281,629
Abstentions 28,699
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits: 10.1 Employment Agreement between the
Company and Marvin J. Gralnick,
effective as of February 7, 2000.
10.2 Employment Agreement between the
Company and Helene B. Gralnick,
effective as of February 7, 2000.
10.3 Employment Agreement between the
Company and Tedford Marlow, dated
August 28, 2000.
10.4 Revolving Credit and Term Loan
Agreement by and among Bank of
America, N.A., the Company and
the subsidiaries of the Company
dated as of May 12, 2000.
27 Financial Data Schedule.
(b) Reports on Form 8-K The Company did not file any
reports on Form 8-K during the
current period.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: AUGUST 31, 2000 By: /s/ MARVIN J. GRALNICK
--------------- ---------------------------------------------
Marvin J. Gralnick
Chief Executive Officer
(Principal Executive Officer)
Date: AUGUST 31, 2000 By: /s/ CHARLES J. KLEMAN
--------------- ---------------------------------------------
Charles J. Kleman
Chief Financial Officer
(Principal Financial and Accounting Officer)
12
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EXHIBIT INDEX
EXHIBIT DESCRIPTION
------- -----------
10.1 Employment Agreement between the Company and Marvin J. Gralnick,
effective as of February 7, 2000.
10.2 Employment Agreement between the Company and Helene B. Gralnick,
effective as of February 7, 2000.
10.3 Employment Agreement between the Company and Tedford Marlow, dated
August 28, 2000.
10.4 Revolving Credit and Term Loan Agreement by and among Bank of
America, N.A., the Company and the subsidiaries of the Company
dated as of May 12, 2000.
27 Financial Data Schedule.
