<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1 TO
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
DATE OF REPORT: DECEMBER 31, 1997
(Date of earliest event reported)
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
MICHIGAN COMMISSION FILE NO. 333-2522-01 38-3144240
(State of Organization) (IRS Employer
I.D. No.)
31700 MIDDLEBELT ROAD
SUITE 145
FARMINGTON HILLS, MICHIGAN 48334
(Address of principal executive offices)
(248) 932-3100
(Registrant's telephone number, including area code)
=====================================================
Page 1 of 19 pages
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
The financial statements and the pro forma financial information of
the Registrant for the properties acquired by the Registrant during the 1997
calendar year, prepared in accordance with Regulation S-X, are included in this
Report. Pursuant to Regulation S-X, financial statements are being provided
for only four such properties as the aggregate purchase price for such
properties is more than fifty percent (50%) of the aggregate purchase price of
all properties acquired by the Registrant during the 1997 calendar year.
SIGNATURE
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 hereunto duly authorized.
SUN COMMUNITIES OPERATING LIMITED
PARTNERSHIP
By: Sun Communities, Inc.,
a Maryland corporation
Its: General Partner
Date: March 13, 1998 By: /s/ Jeffrey P. Jorissen
----------------------------------
Jeffrey P. Jorissen,
Senior Vice President,
Treasurer, Chief
Financial Officer, and
Secretary
Page 2 of 19 pages
<PAGE> 3
FINANCIAL STATEMENTS AND PRO FORMA INFORMATION
TABLE OF CONTENTS
FINANCIAL STATEMENTS
Southfork Mobile Home Park Page
- -------------------------- ----
Report of Independent Accountants . . . . . . . . . . . . . . . . . . . 4
Historical Summaries of Gross Income and Direct Operating Expenses . . 5
Woodside Terrace
- ----------------
Report of Independent Accountants . . . . . . . . . . . . . . . . . . . 7
Historical Summaries of Gross Income and Direct Operating Expenses . . 8
Willowbrook Place
- -----------------
Report of Independent Accountants . . . . . . . . . . . . . . . . . . . 10
Historical Summaries of Gross Income and Direct Operating Expenses . . 11
White Oak Estates
- -----------------
Report of Independent Accountants . . . . . . . . . . . . . . . . . . . 13
Historical Summaries of Gross Income and Direct Operating Expenses . . 14
PRO FORMA INFORMATION
- ---------------------
Pro Forma Condensed Consolidated Statement of Operations
for the year ended December 31, 1996 (unaudited) . . . . . . . . . . 16
Page 3 of 19 pages
<PAGE> 4
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors and Shareholders
of Sun Communities, Inc.:
We have audited the accompanying historical summaries of gross income and
direct operating expenses (the "Historical Summaries") of Southfork Mobile Home
Park for the six-month period ended June 30, 1997 and the year ended December
31, 1996. These Historical Summaries are the responsibility of Southfork Mobile
Home Park's management. Our responsibility is to express an opinion on the
Historical Summaries based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summaries are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summaries. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summaries. We believe that our audits provide a reasonable
basis for our opinion.
The accompanying Historical Summaries were prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission and are not intended to be a complete presentation of Southfork
Mobile Home Park's revenues and expenses.
In our opinion, the Historical Summaries referred to above present fairly, in
all material respects, the gross income and direct operating expenses described
in Note 1 of Southfork Mobile Home Park for the six-month period ended June 30,
1997 and the year ended December 31, 1996, in conformity with generally
accepted accounting principles.
COOPERS & LYBRAND L.L.P.
- ------------------------
Coopers & Lybrand L.L.P.
Detroit, Michigan
January 9, 1998
Page 4 of 19 pages
<PAGE> 5
SUN COMMUNITIES, INC.
SOUTHFORK MOBILE HOME PARK
HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
for the six-month period ended June 30, 1997 and the year ended December 31,
1996
<TABLE>
<CAPTION>
SIX
MONTHS YEAR
ENDED ENDED
JUNE 30, DEC 31,
1997 1996
----------- ------------
<S> <C> <C>
Gross Income:
Rental income $ 516,915 $ 939,282
Other income 160,306 307,336
----------- ------------
Total gross income 677,221 1,246,618
----------- ------------
Direct operating costs:
Property operating and maintenance expenses 260,961 501,862
Real estate taxes 21,534 42,837
General and administrative 23,686 46,602
----------- ------------
306,181 591,301
----------- ------------
Gross income in excess of direct operating expenses $ 371,040 $ 655,317
=========== ============
</TABLE>
The accompanying note is an integral part of the historical summaries.
Page 5 of 19 pages
<PAGE> 6
SUN COMMUNITIES, INC.
SOUTHFORK MOBILE HOME PARK
NOTE TO HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING
EXPENSES
1. BASIS OF PRESENTATION:
The Historical Summaries have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission for the real estate
operations acquired. The Historical Summaries are not representative of
the actual operations for the periods presented, as certain
expenses which may not be comparable to the expenses expected to be
incurred by Sun Communities, Inc. in the proposed future operations of
Southfork Mobile Home Park have been excluded. Expenses excluded consist
of management fees, interest, depreciation, certain professional fees and
other indirect costs not directly related to the future operations of the
Southfork Mobile Home Park property. Rental income is recognized when
due from residents.
The Historical Summaries relate to operations of the property which was
acquired by Sun Communities, Inc. in December, 1997. Southfork Mobile
Home Park had 476 developed sites at June 30, 1997.
Page 6 of 19 pages
<PAGE> 7
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors and Shareholders
of Sun Communities, Inc.:
We have audited the accompanying historical summaries of gross income and
direct operating expenses (the "Historical Summaries") of Woodside Terrace for
the six-month period ended June 30, 1997 and the year ended December 31, 1996.
These Historical Summaries are the responsibility of Woodside Terrace's
management. Our responsibility is to express an opinion on the Historical
Summaries based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summaries are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summaries. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summaries. We believe that our audits provide a reasonable
basis for our opinion.
The accompanying Historical Summaries were prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission and are not intended to be a complete presentation of Woodside
Terrace's revenues and expenses.
In our opinion, the Historical Summaries referred to above present
fairly, in all material respects, the gross income and direct operating
expenses described in Note 1 of Woodside Terrace for the six-month period ended
June 30, 1997 and the year ended December 31, 1996, in conformity with
generally accepted accounting principles.
Coopers & Lybrand L.L.P.
Detroit, Michigan
January 9, 1998
Page 7 of 19 pages
<PAGE> 8
SUN COMMUNITIES, INC.
WOODSIDE TERRACE
HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
for the six-month period ended June 30, 1997 and the year ended
December 31, 1996
<TABLE>
<CAPTION>
SIX
MONTHS YEAR
ENDED ENDED
JUNE 30, DEC 31,
1997 1996
--------- ----------
<S> <C> <C>
Gross Income:
Rental income $ 653,969 $1,282,038
Other income 14,438 37,824
--------- ----------
Total gross income 668,407 1,319,862
--------- ----------
Direct operating costs:
Property operating and maintenance expenses 122,036 304,815
Real estate taxes 19,947 40,260
General and administrative 6,077 29,847
--------- ----------
148,060 374,922
--------- ----------
Gross income in excess of direct operating expenses $ 520,347 $ 944,940
========= ==========
</TABLE>
The accompanying note is an integral part of the Historical Summaries.
Page 8 of 19 pages
<PAGE> 9
SUN COMMUNITIES, INC.
WOODSIDE TERRACE
NOTE TO HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
1. BASIS OF PRESENTATION:
The Historical Summaries have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission for the
real estate operations acquired. The Historical Summaries are not
representative of the actual operations for the periods presented, as
certain expenses which may not be comparable to the expenses expected
to be incurred by Sun Communities, Inc. in the proposed future
operations of Woodside Terrace have been excluded. Expenses excluded
consist of management fees, interest, depreciation, certain professional
fees and other indirect costs not directly related to the future
operations of the Woodside Terrace property. Rental income is
recognized when due from residents.
The Historical Summaries relate to operations of the property which was
leased by Sun Communities, Inc in November, 1997. Woodside Terrace had
439 developed sites at June 30, 1997.
Page 9 of 19 pages
<PAGE> 10
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors and Shareholders
of Sun Communities, Inc.:
We have audited the accompanying historical summaries of gross income and
direct operating expenses (the "Historical Summaries") of Willowbrook Place for
the six-month period ended June 30, 1997 and the year ended December 31, 1996.
These Historical Summaries are the responsibility of Willowbrook Place's
management. Our responsibility is to express an opinion on the Historical
Summaries based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summaries are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summaries. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summaries. We believe that our audits provide a reasonable
basis for our opinion.
The accompanying Historical Summaries were prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission and are not intended to be a complete presentation of Willowbrook
Place's revenues and expenses.
In our opinion, the Historical Summaries referred to above present fairly, in
all material respects, the gross income and direct operating expenses described
in Note 1 of Willowbrook Place for the six-month period ended June 30, 1997 and
the year ended December 31, 1996, in conformity with generally accepted
accounting principles.
Coopers & Lybrand LLP
Detroit, Michigan
January 9, 1998
Page 10 of 19 pages
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SUN COMMUNITIES, INC.
WILLOWBROOK PLACE
HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
for the six-month period ended June 30, 1997 and the year ended
December 31, 1996
<TABLE>
<CAPTION>
SIX
MONTHS YEAR
ENDED ENDED
JUN 30, DEC 31,
1997 1996
----------- -----------
<S> <C> <C>
Gross Income:
Rental income $ 390,809 $ 765,642
Other income 4,175 13,850
----------- -----------
Total gross income 394,984 779,492
----------- -----------
Direct operating costs:
Property operating and maintenance expenses 66,426 145,452
Real estate taxes 18,234 36,802
General and administrative 6,523 11,159
----------- -----------
Total direct operating expenses 91,183 193,413
----------- -----------
Gross income in excess of direct operating expenses $ 303,801 $ 586,079
=========== ===========
</TABLE>
The accompanying note is an integral part of the Historical Summaries.
Page 11 of 19 pages
<PAGE> 12
SUN COMMUNITIES, INC.
WILLOWBROOK PLACE
NOTE TO HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING
EXPENSES
1. BASIS OF PRESENTATION:
The Historical Summaries have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission for the real estate
operations acquired. The Historical Summaries are not representative of
the actual operations for the periods presented, as certain
expenses which may not be comparable to the expenses expected to be
incurred by Sun Communities, Inc. in the proposed future operations of
Willowbrook Place have been excluded. Expenses excluded consist of
management fees, interest, depreciation, certain professional fees and
other indirect costs not directly related to the future operations of the
Willowbrook Place property. Rental income is recognized when due from
residents.
The Historical Summaries relate to operations of the property which was
leased by Sun Communities, Inc. in December, 1997. Willowbrook Place had
266 developed sites at June 30, 1997.
Page 12 of 19 pages
<PAGE> 13
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
Board of Directors and Shareholders
of Sun Communities, Inc.:
We have audited the accompanying historical summaries of gross income and
direct operating expenses (the "Historical Summaries") of White Oak Estates for
the six-month period ended June 30, 1997 and the year ended December 31, 1996.
These Historical Summaries are the responsibility of White Oak Estates'
management. Our responsibility is to express an opinion on the Historical
Summaries based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Historical Summaries are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Historical Summaries. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of
the Historical Summaries. We believe that our audits provide a reasonable
basis for our opinion.
The accompanying Historical Summaries were prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission and are not intended to be a complete presentation of White Oak
Estates' revenues and expenses.
In our opinion, the Historical Summaries referred to above present fairly, in
all material respects, the gross income and direct operating expenses described
in Note 1 of White Oak Estates for the six-month period ended June 30, 1997 and
the year ended December 31, 1996, in conformity with generally accepted
accounting principles.
Coopers & Lybrand L.L.P.
Detroit, Michigan
December 23, 1997
Page 13 of 19 pages
<PAGE> 14
SUN COMMUNITIES, INC.
WHITE OAK ESTATES
HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING EXPENSES
for the six-month period ended June 30, 1997 and the year ended December 31,
1996
<TABLE>
<CAPTION>
SIX
MONTHS YEAR
ENDED ENDED
JUN 30, DEC 31,
1997 1996
----------- ----------
<S> <C> <C>
Gross Income:
Rental income $ 536,975 $ 1,039,433
Other income 3,135 6,801
----------- ----------
Total gross income 540,110 1,046,234
----------- ----------
Direct operating costs:
Property operating and maintenance expenses 150,073 292,968
Real estate taxes 56,991 106,547
General and administrative 2,352 11,880
----------- ----------
209,416 411,395
----------- ----------
Gross income in excess of direct operating expenses $ 330,694 $ 634,839
=========== ==========
</TABLE>
The accompanying note is an integral part of the Historical Summaries.
Page 14 of 19 pages
<PAGE> 15
SUN COMMUNITIES, INC.
WHITE OAK ESTATES
NOTE TO HISTORICAL SUMMARIES OF GROSS INCOME AND DIRECT OPERATING
EXPENSES
1. BASIS OF PRESENTATION:
The Historical Summaries have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission for the real estate
operations acquired. The Historical Summaries are not representative of
the actual operations for the periods presented, as certain
expenses which may not be comparable to the expenses expected to be
incurred by Sun Communities, Inc. in the proposed future operations of
White Oak Estates have been excluded. Expenses excluded consist of
management fees, interest, depreciation, certain professional fees and
other indirect costs not directly related to the future operations of the
White Oak Estates property. Rental income is recognized when due from
residents.
The Historical Summaries relate to operations of White Oak Estates which
was acquired by Sun Communities, Inc. in December, 1997. White Oak
Estates had 377 developed sites at June 30, 1997.
Page 15 of 19 pages
<PAGE> 16
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1996
(UNAUDITED)
During 1997, the Company acquired twelve manufactured housing communities,
consisting of 4,258 manufactured housing and recreational vehicle sites, for an
aggregate purchase price of $69.8 million. All communities were acquired from
parties unrelated to the Company. In acquiring these manufactured housing
communities, management evaluated material factors including, but not limited
to, each community's operating income, location and competition, rent structure,
occupancy rates, developed sites and undeveloped sites or property.
The following pro forma consolidated balance sheet as of December 31, 1996 and
the pro forma consolidated statement of operations for the year then ended have
been prepared to reflect the acquisition of the twelve manufactured housing
communities. The pro forma financial information is based on the consolidated
historical financial statements of Sun Communities Operating Limited Partnership
and should be read in conjunction with those financial statements and the notes
thereto. The pro forma consolidated balance sheet was prepared as if the
acquisitions described herein occurred on December 31, 1996. The pro forma
consolidated statement of operations was prepared as if the acquisitions
described herein occurred on January 1, 1996. The pro forma financial
information is unaudited and is not necessarily indicative of the results which
actually would have occurred if the transaction had been consummated on the
dates described, nor does it purport to represent the Company's future financial
position or results of operations.
<TABLE>
<CAPTION>
Sun Communities
Sun Communities Operating Limited
Operating Limited Pro Forma Partnership
Partnerhsip (A) Adjustments Pro Forma
------------------ ----------------- ------------------
Assets: (in thousands)
<S> <C> <C> <C>
Investment in real estate, net $ 558,278 $69,800 (B) $ 628,078
Cash and cash equivalents 9,236 (9,200)(B) 36
Investment in Sun Home Services, Inc. 5,103 5,103
Mortgage notes receivable 4,176 4,176
Other assets 8,263 8,263
--------- --------- ---------
Total assets $ 585,056 $ 60,600 $ 645,656
========= ========= =========
Liabilities:
Line of credit $ 8,200 (C) $ 8,200
Debt $ 185,000 52,400 (C) 237,400
Accounts payable and
accrued expenses 7,718 7,718
Deposits and other liabilities 9,123 9,123
--------- --------- ---------
Total liabilities 201,841 60,600 262,441
--------- --------- ---------
Partners' Capital:
Preferred operating partnership units 35,783
Operating partnership units
General partner 300,932 300,932
Limited partners 46,500 46,500
--------- --------- ---------
Total partners' capital 383,215 0 383,215
--------- --------- ---------
Total liabilities and partners' capital $ 585,056 $ 60,600 $ 645,656
========= ========= =========
</TABLE>
- ------------
(A) Reflects the Company's historical consolidated balance sheet as of December
31, 1996.
(B) Amounts presented reflect the acquisition of twelve manufactured
home communities.
(C) Includes $35 million of senior notes issued, $17,400 of
collateralized lease obligations and $8,200 borrowed from the Company's
line of credit.
Page 16 of 19 pages
<PAGE> 17
SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(UNAUDITED)
<TABLE>
<CAPTION>
Sun Communities
Sun Communities Gross Income and Direct Operating Other Operating Limited
Operating Limited Expenses of Acquired Properties Pro Forma Partnership
Partnerhsip (A) (B) (C) Adjustments Pro Forma
------------------ --------------- ---------------- -------------- ------------------
REVENUES (in thousands except per unit data)
<S> <C> <C> <C> <C> <C>
Income from property $ 71,312 $ 4,392 $ 4,654 $ 80,358
Income from Sun Home Services, Inc. 506 506
Other income 1,381 1,381
-------- -------- -------- -------- --------
Total revenues 73,199 4,392 4,654 0 82,245
-------- -------- -------- -------- --------
EXPENSES
Property operating and maintenance 15,970 1,245 1,651 18,866
Real estate taxes 5,654 226 371 6,251
General and administrative 3,458 100 3,558
Depreciation and amortization 14,887 $2,321 (E) 17,208
Interest 11,277 4,051 (D) 15,328
-------- -------- -------- -------- --------
Total expenses 51,246 1,571 2,022 6,372 61,211
-------- -------- -------- -------- --------
Net income (G) 21,953 2,821 2,632 (6,372) 21,034
Less distribution to Preferred OP Units 1,670 1,670
-------- -------- -------- -------- --------
Earnings attributable to OP Units $ 20,283 $ 2,821 $ 2,632 ($ 6,372) $ 19,364
======== ======== ======== ======== ========
Earnings attributed to:
General Partner 17,810 (F) 2,471 (F) 2,306 (F) (5,582)(F) 17,005
Limited Partners 2,473 (F) 350 (F) 326 (F) (790)(F) 2,359
======== ======== ======== ======== ========
$ 20,283 $ 2,821 $ 2,632 ($ 6,372) $ 19,364
======== ======== ======== ======== ========
Net income per OP Unit $1.24
Weighted average number of OP Units outstanding 15,646
</TABLE>
(A) Reflects the historical operations of Sun Operating Limited Partnership for
the year ended December 31, 1996.
(B) These adjustments are derived from audited Historical Summaries of Gross
Income and Direct Operating Expenses for four manufactured housing
communities the Company acquired for an aggregate purchase price of $36.3
million.
(C) These adjustments reflect the unaudited gross income and direct operating
expenses of eight manufactured housing communities the Company acquired in
Florida (4), Texas (2), Indiana (1) and Michigan (1), for an aggregate
purchase price of $33.5 million. The communities contained an aggregate of
2,809 sites at their respective acquisition dates, including 1,867
manufactured housing sites, 604 recreational vehicle sites and 338
undeveloped sites.
(D) Reflects the adjustment necessary to reflect annual interest expense
computed as follows:
<TABLE>
<S> <C>
$8,200 Line of credit at 6.89% $565
$35,000 Senior Notes at 6.97% 2,440
$17,400 lease obligations at 6.1% 1,047
======
$4,051
======
</TABLE>
(E) Reflects depreciation on the acquired communities.
(F) Reflects adjustment necessary to state limited partners earnings at 12.4%.
(G) Before extraordinary item.
Page 17 of 19 pages
<PAGE> 18
EXHIBIT INDEX
Exhibit
Number Description Filed Herewith
- ------ ----------------- --------------
23.1 Consent of Coopers & Lybrand L.L.P., X
independent accountants
Page 18 of 19 pages
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorportation by reference in the registration statements of
Sun Communities Operating Limited Partnership on Form S-3 (File No. 333-2522;
File No. 333-14595) of our reports dated January 9, 1998 on our audits of the
Historical Summaries of Gross Income and Direct Operating Expenses of each of
Willowbrook Place, Woodside Terrace, and White Oak Estates, and our report
dated December 23, 1997 on our audit of the Historical Summaries of Gross
Income and Direct Operating Expenses of Southfork Mobile Home Park, for the six
months period ended June 30, 1997 and the year ended December 31, 1996, which
reports are included in this Current Report on Form 8-K.
/s/ Coopers & Lybrand L.L.P.
- -------------------------------
Coopers & Lybrand L.L.P.
Detroit, Michigan
March 13, 1998
Page 19 of 19 pages
