10-Q 1 l96205ae10vq.txt GENESEE CORPORATION * 10-Q FOR QTR. END 07/27/02 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. FORM 10-Q [x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 27, 2002 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ------------------ ------------------ Commission File Number 0 - 1653 -------- GENESEE CORPORATION ------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) STATE OF NEW YORK 16-0445920 -------------------- ---------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 600 Powers Bldg., 16 W. Main Street, Rochester, New York 14614 ---------------------------------------------------------- ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (585) 454-1250 ---------------- 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 ----- ----- As of the date of this report, the Registrant had the following shares of common stock outstanding: Number of Shares Class Outstanding ----- ----------- Class A Common Stock (voting), par value $.50 per share 209,885 Class B Common Stock (non-voting), par value $.50 per share 1,464,201 Page 2 of 14 GENESEE CORPORATION AND SUBSIDIARIES Statements Of Net Assets In Liquidation (Liquidation Basis) July 27, 2002 and April 27, 2002 (Dollars in thousands, except per share data)
UNAUDITED JULY 27, 2002 APRIL 27, 2002 ------------- -------------- ASSETS Cash and cash equivalents $ 10,752 $ 16,747 Marketable securities available for sale 6,799 6,667 Notes receivable 9,939 10,081 Investment in and notes receivable from unconsolidated real estate partnerships 4,500 6,351 Investment in direct financing and leveraged leases 143 209 Estimated income tax receivable 793 994 Other assets 441 811 ---------- ---------- Total assets $ 33,367 $ 41,860 ========== ========== LIABILITIES AND NET ASSETS Accrued compensation $ 960 $ 1,245 Accrued expenses and other liabilities 1,038 1,021 Liquidating distribution payable 0 8,370 Accrued self-insured workers compensation 1,450 1,602 ---------- ---------- Total liabilities 3,448 12,238 ---------- ---------- Net assets in liquidation $ 29,919 $ 29,622 ========== ========== Number of common shares outstanding (Class A - 209,885; Class B - 1,464,201) 1,674,086 1,674,086 Net assets in liquidation per outstanding share $ 17.87 $ 17.69 ========== ==========
See accompanying notes to consolidated financial statements. Page 3 of 14 GENESEE CORPORATION AND SUBSIDIARIES Statement Of Changes In Net Assets In Liquidation (Liquidation Basis) For the Thirteen Weeks Ended July 27, 2002 (Dollars in thousands)
UNAUDITED Net assets in liquidation at April 27, 2002 $29,622 Changes in estimated liquidation values of assets and liabilities 297 ------- Net assets in liquidation at July 27, 2002 $29,919 =======
See accompanying notes to consolidated financial statements. page 4 of 14 GENESEE CORPORATION AND SUBSIDIARIES Consolidated Statement of Earnings and Comprehensive Loss (Going-Concern Basis) Thirteen Weeks Ended July 28, 2001 (Dollars in thousands, except per share data)
UNAUDITED Revenues $ 0 Cost of goods sold 0 ----------- Gross profit 0 Selling, general and administrative expenses 276 ----------- Operating loss (276) Investment and interest income 445 Other income 5 ----------- Income from continuing operations before income taxes 174 Income tax expense 70 ----------- Income from continuing operations 104 Discontinued operations: Loss from operations of the discontinued segments (less applicable income tax expense of $ 345) (21,541) Adjustment to the loss on disposal of Genesee Ventures, Inc. (less applicable income tax expense of $ 227) 354 ----------- Net loss (21,083) Other comprehensive income, net of income taxes: Unrealized holding gains arising during the period 82 ----------- Comprehensive loss $ (21,001) =========== Basic and diluted loss per share from continuing operations $ 0.06 Basic and diluted loss per share from discontinued operations $ (12.87) Basic and diluted gain per share from disposal of Genesee Ventures, Inc. $ 0.21 ----------- Basic and diluted loss per share $ (12.60) ============ Weighted average common shares outstanding 1,674,086 Weighted average and common equivalent shares 1,674,086
See accompanying notes to consolidated financial statements. page 5 of 14 GENESEE CORPORATION AND SUBSIDIARIES Consolidated Statement of Cash Flows (Going-Concern Basis) THIRTEEN WEEKS ENDED JULY 28, 2001 (Dollars in thousands)
UNAUDITED CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings from continuing operations $ 104 Adjustments to reconcile net loss to net cash provided by operating activities: Net gain on sale of marketable securities (8) Deferred tax provision (2) Other (319) Changes in non-cash assets and liabilities, net of amounts sold: Income taxes payable 250 Other liabilities (1) ------------ Net cash provided by continuing operating activities 24 Net cash provided by discontinued operations 1,176 -------------------------------------------------------------------- NET CASH PROVIDED BY OPERATING ACTIVITIES 1,200 -------------------------------------------------------------------- CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sale of marketable securities 1,915 Purchases of marketable securities and other investments (1,732) ------------ Net cash provided by continuing investing activities 183 Net cash provided by discontinued operations 65 -------------------------------------------------------------------- NET CASH PROVIDED BY INVESTING ACTIVITIES 248 -------------------------------------------------------------------- CASH FLOWS FROM FINANCING ACTIVITIES: Net cash used in continuing financing activities 0 Net cash used in discontinued operations (1,403) -------------------------------------------------------------------- NET CASH USED IN FINANCING ACTIVITIES (1,403) -------------------------------------------------------------------- Net increase in cash and cash equivalents 45 Cash and cash equivalents at beginning of the period 12,237 ------------------------------------------------------------------------------- CASH AND CASH EQUIVALENTS AT END OF THE PERIOD $ 12,282 ===============================================================================
See accompanying notes to consolidated financial statements. page 6 of 14 GENESEE CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements ------------------------------------------ NOTE (A) Divestiture of the Corporation's Operating Businesses and Other Assets ---------------------------------------------------------------------- In October 2000, Genesee Corporation (the "Corporation") shareholders approved a plan to divest all of its operations and then liquidate and dissolve the Corporation. Since then, as discussed below, the Corporation has disposed of all of its operations and is in the process of selling its remaining assets and settling remaining liabilities. The proceeds from this liquidation, net of amounts paid or reserved to discharge all of the Corporation's obligations and liabilities, are being distributed to the Corporation's shareholders in a series of liquidating distributions, after which the Corporation will be dissolved. The Corporation sold its brewing business in December 2000 to High Falls Brewing Company, LLC ("High Falls") for $27.2 million. The Corporation received $11 million of the sale price in the form of notes receivable more fully described in Note B. The Corporation sold a significant portion of its equipment lease portfolio in December 2000 and received $12.8 million in proceeds and continues to hold some of the leases which it retained. On October 10, 2001, the Corporation sold all of the outstanding stock of its Ontario Foods, Inc. subsidiary, which constituted its Foods Division, to Associated Brands, Inc. ("ABI") for $27 million. Net of purchase price adjustments, the Corporation received $22.1 million in cash. The Corporation also took back a $2.25 million note and mortgage. The note and mortgage, together with $178,000 in cash paid by ABI, were placed in escrow for a period of eighteen months to cover any contingent liabilities or post-closing obligations of the Corporation. On April 5, 2002 ABI paid in full the $2.25 million note and mortgage so the $2.43 million escrow is now funded entirely by cash, which is invested in commercial bank money market funds. On May 31, 2002, the Corporation sold its ten-percent interest in an office building in Rochester, New York and a related note receivable from the building owner for $2.4 million in cash. In connection with this transaction, the purchasers have agreed to indemnify the Corporation for any liability arising from the Corporation's guaranty of half of a $5.5 million senior subordinated loan on the building. The Corporation is evaluating strategies to sell or otherwise divest the Corporation's remaining assets, all of which have been adjusted to their estimated net realizable values as stated in Note B. Notes to Consolidated Financial Statements ------------------------------------------- NOTE (B) Liquidation Basis of Accounting ------------------------------- With the sale of its Foods Division, which is described in Note A, the Corporation adopted the liquidation basis of accounting effective September 29, 2001. Under the liquidation basis of accounting, assets are stated at their estimated net realizable values and liabilities are stated at their estimated settlement amounts, which estimates are periodically reviewed and adjusted. A Statement of Net Assets and a Statement of Changes in Net Assets are the two financial statements presented under the Liquidation Basis of Accounting. page 7 of 14 GENESEE CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements ------------------------------------------ NOTE (B) Liquidation Basis of Accounting (continued) ------------------------------------------- The valuation of assets at their net realizable value and liabilities at their anticipated settlement amounts necessarily requires many estimates and assumptions. In addition, there are substantial risks and uncertainties associated with carrying out the liquidation and dissolution of the Corporation. The valuations presented in the accompanying Statement of Net Assets in Liquidation represent estimates, based on present facts and circumstances, of the net realizable values of assets and the costs associated with carrying out the plan of liquidation and dissolution based on the assumptions set forth below. The actual values and costs are expected to differ from the amounts shown herein and could be greater or lesser than the amounts recorded. In particular, the estimates of the Corporation's costs will vary with the length of time it operates. Accordingly, it is not possible to predict the aggregate amount that will ultimately be distributable to shareholders and no assurance can be given that the amount to be received in liquidation will equal or exceed the net assets in liquidation per share presented in the accompanying Statement of Net Assets in Liquidation or the price or prices at which the Corporation's common stock has generally traded or is expected to trade in the future. General assumptions used and asset and liability values under the Liquidation Basis of Accounting Following are assumptions utilized by management in assessing the fair value of assets and the expected settlement values of liabilities included in the Statement of Net Assets in Liquidation as of July 27, 2002. Cash and cash equivalents - Presented at face value. The Corporation considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The Corporation maintains balances in various operating and money market accounts in excess of federally insured limits. At July 27, 2002, substantially all cash balances were in excess of federally insured limits. Marketable securities available for sale - Presented at quoted market prices. The Corporation maintains a portfolio that consists predominantly of high quality corporate bonds which is managed by an independent third party. Valuation of the Corporation's marketable securities is based upon closing prices of their marketable securities, as provided by the investment manager, at July 27, 2002. Notes receivable - Stated at face value, which approximates fair value. As partial consideration for the Corporation's sale of Genesee Brewing Company, the Corporation received $11 million in notes receivable from the buyer. At July 27, 2002, these notes receivable totaled $9.9 million. On July 30, 2002 the Corporation received $5.9 million in satisfaction of the remaining principal balance due on the two bridge notes with original face amounts of $3.5 million and $3 million. This prepayment, which occurred after the first quarter ended, was in accordance with the terms of the notes which required prepayment at such time as the buyer received proceeds from HUD financing. The Corporation's management believes the $4 million balance on the remaining note receivable to be fully collectible, and the interest rate on the note is considered to be at market; therefore, the face value of the note is considered to be fair value. The remaining $4 million note balance is payable as follows: $1 million due on December 15, 2002 and $3 million due on December 15, 2003. Investment in and notes receivable from unconsolidated real estate partnerships - Valued based on independent appraisals and management estimates: page 8 of 14 GENESEE CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements ------------------------------------------ NOTE (B) Liquidation Basis of Accounting (continued) ------------------------------------------- Clinton Square - The Corporation owned a 10% interest in Clinton Square, an office building located in Rochester, New York, and a related note receivable. On May 31, 2002, the Corporation sold both its ownership interest and related note receivable from Clinton Square for $2.4 million. Limited Partnerships - The Corporation owns a 50% interest in a 408-unit apartment complex located in Syracuse and a 150-unit apartment complex located in Rochester, New York. The Corporation has obtained independent appraisals of the properties and management is currently engaged in negotiations with potential purchasers of the Corporation's interests in both properties. The fair market value at July 27, 2002 of the Corporation's investment in these properties was increased by $500,000 to $4.5 million to reflect management's estimate based on the independent appraisals and negotiations with potential purchasers. Investment in direct financing and leveraged leases - Presented at the present value of future lease payments of leases under renewal and the estimated fair value of all equipment under renewed and month-to-month leases. Estimated income tax receivable - Based on management's estimate. Amount reflects the impact on cash flow under an orderly liquidation scenario. It is comprised of current taxes on current year income, adjusting for estimates of future income, and the utilization of tax credits and carryforwards. Certain amounts included in the estimated income tax receivable are subject to audit by various taxing authorities. Management does not believe that the results of any audit will significantly alter this amount. During the first quarter of fiscal 2003 this amount was reduced by $200,000 related to Management's estimate of the net realizable value of its investment in the two apartment complexes mentioned above. Other assets - Valued based on management estimates. Accrued compensation, accrued expenses, and other liabilities - Based on management's estimate. These are the estimated costs to complete the Corporation's plan of liquidation and dissolution, and represents the estimated cash costs of operating the Corporation through its expected termination date. These costs, which include personnel, facilities, professional fees, and other related costs, are estimated based on various assumptions regarding the number of employees, the use of outside professionals (including attorneys and accountants) and other costs. Given that there is inherent uncertainty in the estimation process, actual results could be materially different. During the first quarter of fiscal 2003, the accrued expenses and other liabilities estimate was increased by $350,000 as the result of preliminary audit findings from a New York State sales and use tax audit related to the Corporation's former brewing business. Accrued self-insured workers compensation - Based on an independent actuarial valuation, which has been rolled forward to quarter end. The Corporation is self-insured for workers compensation claims and has retained this liability for the subsidiaries that were sold. The Corporation is required to have a statutory standby letter of credit in the amount of $3.2 million for workers compensation claims. This letter of credit, which is renewed annually, has been collateralized by Corporation cash and is in effect through August 2003. page 9 of 14 GENESEE CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements ------------------------------------------- NOTE (B) Liquidation Basis of Accounting (continued) ------------------------------------------- Contingent liabilities - In addition to liabilities recorded on the accompanying consolidated financial statements, the Corporation also has certain contingent liability claims. Management does not believe that there will be any future material cash outflows as a result of these claims, or as a result of any other unknown claims or liabilities, thus no amount is included in these accompanying consolidated financial statements. Notes to Consolidated Financial Statements ------------------------------------------- NOTE (C) Financial Statement Presentation -------------------------------- Liquidation Basis Financial Statements The Corporation's Statement of Net Assets in Liquidation and Statement of Changes in Net Assets in Liquidation for the thirteen weeks ended July 27, 2002 presented herein are unaudited. The April 27, 2002 Statement of Net Assets has been audited. In the opinion of management, these financial statements reflect all adjustments which are necessary for a fair presentation of the results for the interim period presented. Net assets in liquidation per outstanding share, which is reported in the Statement of Net Assets in Liquidation, is calculated by dividing net assets in liquidation by the number of common shares outstanding as of the specific statement date. Going-Concern Basis Financial Statements For the prior year thirteen week period ended July 28, 2001, all of the Corporation's subsidiary operating businesses are reported as discontinued operations with only the corporate segment reported as continuing operations. The Consolidated Statement of Earnings and Comprehensive Loss and the Consolidated Statement of Cash Flows are the only going-concern based financial statements that are included in this report. The accompanying financial statements have been prepared in accordance with GAAP and SEC guidelines applicable to interim financial information. These statements should be reviewed in conjunction with the Corporation's annual report on Form 10-K for the year ended April 27, 2002. It is the Corporation's policy to reclassify certain amounts in the prior year consolidated financial statements to conform to the current year presentation. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This financial review should be read in conjunction with the accompanying consolidated financial statements. Effective September 29, 2001 the Corporation adopted the liquidation basis of accounting which is described in detail in Note B to the accompanying consolidated financial statements. In the prior fiscal year the Corporation's operating businesses have been classified as discontinued operations and in the current fiscal year the Corporation had no operations. Therefore, there is no discussion of operations in this financial review. page 10 of 14 GENESEE CORPORATION AND SUBSIDIARIES Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) LIQUIDITY AND CAPITAL RESOURCES - JULY 27, 2002 ----------------------------------------------- On August 26, 2002, the Corporation paid a partial liquidating distribution of $8,370,000, or $5.00 per share to shareholders of record on August 19, 2002. This distribution represented the fourth distribution paid to shareholders under the Corporation's plan of liquidation and dissolution. On May 17, 2002 the Corporation paid a partial liquidating distribution of $8,370,000, or $5.00 per share. On November 1, 2001 the Corporation paid a partial liquidating distribution of $21,763,000, or $13.00 per share. On March 1, 2001, the Corporation paid a partial liquidating distribution of $12,557,000 or $7.50 per share. The Corporation expects to pay additional liquidating distributions as the Corporation: (a) receives payment on the remaining promissory note described in Note B to the consolidated financial statements which accompany this report; (b) receives proceeds from the sale of the remaining assets of the Corporation and; (c) discharges contingent liabilities and post-closing obligations arising from the sale of its assets and other contingent liabilities. The length of time that will be required to wind-up the Corporation's affairs are uncertain and will impact the value of the Corporation's net assets in liquidation due to the ongoing expense of operating the Corporation. The Corporation's cash and cash equivalents are invested in commercial bank money market funds. These funds are currently yielding approximately 1.8% per annum. Investment in money market funds is intended to earn a reasonable return on those funds and give the Corporation the security and flexibility required as it completes the liquidation and dissolution process. The Corporation's marketable securities consist of a bond portfolio managed by an investment management firm. This portfolio had a fair market value of $6,799,000 at July 27, 2002. The investments in this portfolio include $1.4 million in money market funds, approximately $544,000 in U.S. treasury notes and government agency bonds with the balance invested in corporate bonds with a Moody's dollar weighted average rating of A1. The entire portfolio currently has a weighted average duration of approximately 1.56 years. The current yield to maturity is approximately 3%. During the quarter ended July 27, 2002, the Corporation received $140,000 in regular principal payments from High Falls under the promissory notes described in Note B to the accompanying consolidated financial statements. Also, as mentioned in Note B, the Corporation received $5.9 million in satisfaction of two High Falls bridge notes. On May 31, 2002, the Corporation received $2.4 million in proceeds from the sale of its ten percent interest in and note receivable from Clinton Square, which is described in Note A of the accompanying consolidated financial statements. This receipt of funds reduced the investment in and notes receivable from unconsolidated real estate partnerships line item in the Statement of Net Assets accordingly. The Corporation has obtained independent appraisals and is currently engaged in negotiations with potential purchasers of its two real estate investments that are described in Note B to the accompanying consolidate financial statements. As a result, the investment in and notes receivable from unconsolidated real estate partnerships line item and the estimated income tax receivable line item in the Statement of Net Assets were increased by $500,000 and decreased by $200,000, respectively. page 11 of 14 GENESEE CORPORATION AND SUBSIDIARIES Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (continued) Other assets were decreased during the first quarter of fiscal 2003 primarily as a result of the Corporation having received $168,000 in insurance refunds and having collected $94,000 from certain officers on outstanding loans. The remaining balance of these officer loans receivable is $73,000 at July 27, 2002. Accrued compensation as presented in the Statement of Net Assets decreased from its April 27, 2002 balance by approximately $300,000 as a result of the payment of expected compensation related costs. Accrued expenses and other liabilities increased by $17,000 as a result of the payment of $333,000 of expected costs and the increase of the accrual by $350,000 as the result of preliminary audit results from a New York State sales and use tax audit related to the Corporation's former brewing business. Forward-Looking Statements -------------------------- This report contains forward-looking statements within the meaning of the federal securities laws. These forward-looking statements include estimates of the net assets of the Corporation in liquidation, statements about the amount and timing of the payment of additional liquidating distributions and statements about the Corporation's operating costs through final dissolution that will vary with the length of time it operates. The cautionary statements regarding estimates of net assets in liquidation set forth in Note B to the consolidated financial statements that accompany this report are incorporated herein by reference. The forward-looking statements in this report are subject to a number of other significant risks and uncertainties, and there can be no assurance that the expectations reflected in those statements will be realized or achieved. Such risks and uncertainties include, without limitation, the risk of default by the purchaser of the Corporation's brewing business on its payment and other obligations under the one remaining promissory note described in Note B to the consolidated financial statements which accompany this report; the possible extension of payment terms under the one remaining promissory note described in Note B to the consolidated financial statements related to the sale of the Corporation's brewing business; the possibility of delay in finding buyers and completing the divestiture of the remaining assets of the Corporation; the amounts that the Corporation is able to realize from the divestiture of the remaining assets of the Corporation; possible contingent liabilities and post-closing indemnification and other obligations arising from the sale of the Corporation's operating businesses and other assets; and risks associated with the liquidation and dissolution of the Corporation, including without limitation, settlement of the Corporation's liabilities and obligations, costs incurred in connection with carrying out the plan of liquidation and dissolution, the amount of income earned during the liquidation period on the Corporation's bond portfolio and investment in money market funds, risks that the market value of the Corporation's bond portfolio could decline, risks associated with investments in bonds and money market funds in the current low interest rate environment, discharge of contingent liabilities, and the actual timing of the winding up and dissolution of the Corporation. Item 4. Controls and Procedures In September of 2002 the Corporation's President and Chief Financial Officer conducted an evaluation of the Corporation's disclosure controls and procedures and concluded that there were no material weaknesses. No significant changes have been made in the Corporation's internal controls and no corrective actions have been taken subsequent to the evaluation. The Corporation is in the process of adopting procedures for periodic evaluation of its disclosure controls and procedures. page 12 of 14 GENESEE CORPORATION AND SUBSIDIARIES PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits. --------- 99 Officer Certifications (b) Reports on Form 8-K. The Corporation filed a report on Form 8-K on July 31, 2002 to report information under Item 5 (Other Events). SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. GENESEE CORPORATION Date: 9/9/02 /s/ Mark W. Leunig --------------- --------------------------------------------------- Mark W. Leunig Sr. Vice President and Chief Administrative Officer Date: 9/9/02 /s/ Steven M. Morse --------------- --------------------------------------------------- Steven M. Morse Vice President and Chief Financial Officer
page 13 of 14 GENESEE CORPORATION AND SUBSIDIARIES I, Stephen B. Ashley, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Genesee Corporation; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; and 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report. Date: September 9, 2002 /s/ Stephen B. Ashley ------------------------------------------ President I, Steven M. Morse, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Genesee Corporation; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; and 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report. Date: September 9, 2002 /s/ Steven M. Morse ------------------------------------------ Vice President and Chief Financial Officer EXPLANATORY NOTES REGARDING CERTIFICATIONS: Representations 4, 5 and 6 of the Certifications as set forth in Item 4 of the Form 10-Q General Instructions have been omitted, consistent with the Transition Provisions of SEC Exchange Act Release No. 34-46427, because this Quarterly Report on Form 10-Q covers a period ending before the Effective Date of Rules 13a-14 and 15d-14.