10-Q 1 v119403_10-q.htm

FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C., 20549

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 31, 2008

o	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 1-8798

Nu Horizons Electronics Corp.

(Exact name of registrant as specified in its charter)

Delaware		11-2621097
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

70 Maxess Road, Melville, New York	11747
(Address of principal executive offices)	(Zip Code)

(631) 396 -5000

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):

Large-accelerated filer o	Accelerated filer x
Non-accelerated filer o	Smaller reporting company o

(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The number of shares outstanding of registrant’s common stock, as of July 7, 2008:

Common Stock - Par Value $.0066		18,466,981
Class		Outstanding Shares

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

INDEX

PART I.	FINANCIAL INFORMATION	Page(s)

Item 1.	Financial Statements

	Consolidated Condensed Statements of Operations (unaudited) -
	Three Months Ended May 31, 2008 and 2007 (as restated for 2007)	3.

	Consolidated Condensed Balance Sheets -
	May 31, 2008 (unaudited) and February 29, 2008	4.

	Consolidated Condensed Statements of Cash Flows (unaudited) -
	Three Months Ended May 31, 2008 and 2007 (as restated for 2007)	5.

	Notes to Interim Consolidated Condensed Financial Statements (unaudited)	6.-11.

	Report of Independent Registered Public Accounting Firm	12.

Item 2.	Management’s Discussion and Analysis of Financial
	Condition and Results of Operations	13.-16.

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	17.

Item 4.	Controls and Procedures	18.

PART II.	OTHER INFORMATION	19.-20.

SIGNATURES		21.

EXHIBIT INDEX		22.

CERTIFICATIONS

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

	For the Three Months Ended
	May 31, 2008			May 31, 2007
				(As Restated)

NET SALES	$	200,152,000		$	175,232,000

COSTS AND EXPENSES:
Cost of sales		169,226,000			145,630,000
Operating expenses		28,147,000			25,661,000
		197,373,000			171,291,000

OPERATING INCOME		2,779,000			3,941,000

OTHER (INCOME) EXPENSE
Interest expense		1,120,000			928,000
Interest income		(188,000	)		(15,000	)
		932,000			913,000

INCOME BEFORE PROVISION FOR INCOME TAXES AND MINORITY INTERESTS		1,847,000			3,028,000

Provision for income taxes		573,000			1,250,000

INCOME BEFORE MINORITY INTERESTS		1,274,000			1,778,000

Minority interest in earnings of subsidiaries		119,000			90,000

NET INCOME	$	1,155,000		$	1,688,000

NET INCOME PER COMMON SHARE:

Basic	$	.06		$	.09

Diluted	$	.06		$	.09

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic		17,971,317			18,217,603
Diluted		18,211,529			19,046,335

See accompanying notes

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS

	May 31, 2008			February 29, 2008
	(unaudited)
- ASSETS -
CURRENT ASSETS:
Cash	$	10,324,000		$	3,886,000
Accounts receivable - net of allowance for doubtful accounts of $4,352,000 and $4,267,000 as of May 31, 2008 and February 29, 2008, respectively		153,068,000			150,270,000
Inventories		132,160,000			122,761,000
Deferred tax asset		3,135,000			3,135,000
Prepaid expenses and other current assets		4,607,000			4,306,000
TOTAL CURRENT ASSETS		303,294,000			284,358,000

PROPERTY, PLANT AND EQUIPMENT - NET		4,619,000			4,529,000

OTHER ASSETS:
Cost in excess of net assets acquired		9,925,000			9,925,000
Intangibles - net		2,449,000			2,500,000
Other assets		4,855,000			5,101,000

TOTAL ASSETS	$	325,142,000		$	306,413,000

- LIABILITIES AND SHAREHOLDERS’ EQUITY -
CURRENT LIABILITIES:
Accounts payable	$	77,762,000		$	67,306,000
Accrued expenses		9,674,000			8,615,000
Due to seller		3,245,000			3,245,000
Bank credit line		4,595,000			603,000
Income taxes payable		-			133,000
TOTAL CURRENT LIABILITIES		95,276,000			79,902,000

LONG TERM LIABILITIES
Revolving credit line		70,500,000			69,300,000
Executive retirement plan		1,863,000			1,684,000
Deferred tax liability		2,107,000			2,072,000
TOTAL LONG TERM LIABILITIES		74,470,000			73,056,000

MINORITY INTEREST IN SUBSIDIARIES		2,381,000			2,261,000

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS’ EQUITY:
Preferred stock, $1 par value, 1,000,000 shares authorized; none issued or outstanding					-
Common stock, $.0066 par value, 50,000,000 shares authorized; 18,468,244 and 18,392,457 shares issued and outstanding as of May 31, 2008 and February 29, 2008, respectively		122,000			121,000
Additional paid-in capital		55,618,000			54,979,000
Retained earnings		97,775,000			96,621,000
Other accumulated comprehensive (loss) income		(500,000	)		(527,000	)
TOTAL SHAREHOLDERS’ EQUITY		153,015,000			151,194,000

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	325,142,000		$	306,413,000

See accompanying notes

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	For The Three Months Ended
	May 31, 2008			May 31, 2007
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS:				(As Restated)

CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers	$	197,288,000		$	183,274,000
Cash paid to suppliers and employees		(194,299,000	)		(202,796,000	)
Interest received		188,000			15,000
Interest paid		(1,050,000	)		(704,000	)
Income taxes paid		(789,000	)		(1,446,000	)
Net cash provided (used) by operating activities		1,338,000			(21,657,000	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(474,000	)		-
Acquisition payments		-			(1,847,000	)
Net cash used by investing activities		(474,000	)		(1,847,000	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings under revolving credit lines		80,047,000			79,736,000
Repayments under revolving credit lines		(74,855,000	)		(57,170,000	)
Proceeds from exercise of stock options		355,000			20,000
Net cash provided by financing activities		5,547,000			22,586,000

EFFECT OF EXCHANGE RATE CHANGE		27,000			(42,000	)

NET CHANGE IN CASH AND CASH EQUIVALENTS		6,438,000			(960,000	)

Cash and cash equivalents, beginning of year		3,886,000			4,747,000

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	10,324,000		$	3,787,000

RECONCILIATION OF NET INCOME TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:

NET INCOME	$	1,155,000		$	1,688,000
Adjustments:
Depreciation and amortization		435,000			371,000
Provision for bad debts		66,000			-
Deferred income tax		35,000			53,000
Increase in minority interest		119,000			90,000
Stock based compensation		284,000			272,000
Changes in assets and liabilities:
Accounts receivable		(2,864,000	)		(9,053,000	)
Inventories		(9,399,000	)		(14,761,000	)
Prepaid expenses and other current assets		(301,000	)		582,000
Other assets		387,000			(796,000	)
Accounts payable and accrued expenses		12,210,000			(1,563,000	)
Income taxes payable		(789,000	)		1,460,000

NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES	$	1,338,000		$	(21,657,000	)

See accompanying notes

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.	BASIS OF PRESENTATION:

In the opinion of management, the accompanying unaudited interim consolidated condensed financial statements of Nu Horizons Electronics Corp. (the “Company”), its wholly owned subsidiaries NIC Components Corp. ("NIC"), NUHC Inc., Nu Horizons International Corp., Nu Horizons Electronics Asia PTE LTD, Nu Horizons Electronics Hong Kong Limited, Nu Horizons Electronics Europe Limited, Nu Horizons Electronics Limited, Titan Supply Chain Services Corp., Titan Supply Chain Services PTE LTD, Titan Supply Chain Services Limited ("Titan"), Nu Horizons Electronics (Shanghai) Co. Ltd., Nu Horizons Electronics Asia Pte Ltd. Korea, Dacom Süd Electronic GmbH, Razor Electronics Inc. and Nu Exchange B2B, Inc. and its majority-owned subsidiaries, NIC Components Asia PTE LTD ("NIA") and NIC Components Europe Limited ("NIE"), contain all adjustments necessary to present fairly the Company’s financial position as of May 31, 2008 and February 29, 2008 and the results of its operations and cash flows for the three month periods ended May 31, 2008 and 2007. All references to the "Company", "we", "us" and "our" refer to Nu Horizons Electronics Corp. and its subsidiaries, unless the context indicates otherwise.

The accounting policies followed by the Company are set forth in Note 1 to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended February 29, 2008, which is incorporated herein by reference. Specific reference is made to that report for a description of the Company’s securities and the notes to consolidated financial statements included therein. The accompanying unaudited interim financial statements have been prepared in accordance with instructions to Form 10-Q and therefore do not include all information and footnotes required by accounting principles generally accepted in the United States of America ("U.S. GAAP").

The results of operations for the three month period ended May 31, 2008 are not necessarily indicative of the results to be expected for the full year.

Revenue Recognition:

The Company recognizes revenue in accordance with the Securities and Exchange Commission Staff Accounting Bulletin No. 104, "Revenue Recognition" ("SAB 104"). Under SAB 104, revenue is recognized when there is persuasive evidence of an arrangement, delivery has occurred or services have been rendered, the sales price is determinable, and collectibility is reasonably assured. Revenue typically is recognized at time of shipment. Sales are recorded net of discounts, rebates, and returns in accordance with EITF 01-09, "Accounting for Consideration Given By a Vendor to a Customer (Including a Reseller of the Vendor's Products)."

The Company has reevaluated its accounting policy for revenue reporting for its Titan division which provides primarily supply chain services. In accordance with EITF 99-19, "Reporting Revenue Gross as a Principal vs. Net as an Agent," the Company has revised its revenue presentation to net as an agent and therefore reduced sales and cost of sales in the first quarter of fiscal year 2008 by $17,361,000. Titan revenue is now reported in sales as a fee for services for all periods presented. There was no change to net income resulting from this change in classification.

2.	RESTATEMENT OF FINANCIAL STATEMENTS:

In preparing the fiscal 2007 tax returns, developing the fiscal 2008 tax provision, and reviewing our accounting for income taxes in connection with the application of the provision of Financial Accounting Standards Board ("FASB") Interpretation No. 48 (FIN 48), "Accounting for Uncertainty in Income Tax - an Interpretation of FASB Statement No. 109", we determined that there were errors in the prior years' tax returns and the application of FASB Statement No. 109 - Accounting for Income Taxes. Consequently, there was an understatement of our provision for income tax expense and the related U.S. income tax obligations, a majority of which related to our foreign operations, for the fiscal years 2002 through 2007.

As a result of the tax adjustments described above and noted below, our management and the Audit Committee of the Company's Board of Directors concluded, as reported in a current report on Form 8-K filed on October 3, 2007, that (1) our previously issued financial statements and any related reports of our independent registered public accounting firm for the fiscal years ended February 28, 2002 through 2007 and the first quarter of fiscal 2008 should no longer be relied upon because of the aforementioned errors in those financial statements, (2) our earnings and press releases and similar communications should no longer be relied upon to the extent that they relate to these financial statements, and (3) our financial statements, original Form 10-K for the fiscal year ended February 28, 2007 and original Form 10-Q for the three months ended May 31, 2007 should be restated to reflect the correct accounting for income taxes discussed above. On

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(CONTINUED)

2.	RESTATEMENT OF FINANCIAL STATEMENTS (Continued):

November 21, 2007, we completed the restatement of our financial statements by filing our Annual Report on Form 10-K/A for the fiscal year ended February 28, 2007 and Form 10-Q/A for the three months ended May 31, 2007.

The following table summarizes the impact of the restatement discussed above on the previously issued Interim Consolidated Condensed Financial Statements as of May 31, 2007 and for the three months ended May 31, 2007:

	For the Three Months Ended May 31, 2007
	As Previously Reported		Adjustment			As Restated
Consolidated Statement of Operations
Provision for income taxes	$	1,124,000	$	126,000		$	1,250,000
Net income		1,814,000		(126,000	)		1,688,000
Net income per common share:
Basic	$	.10	$	(.01	)	$	.09
Diluted	$	.10	$	(.01	)	$	.09

	For the Three Months Ended May 31, 2007
	As Previously Reported		Adjustment			As Restated
Consolidated Statement of Cash Flows
Net income	$	1,814,000	$	(126,000	)	$	1,688,000
Income taxes payable		1,334,000		126,000			1,460,000

3.	NEW ACCOUNTING STANDARDS:

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 160, “Noncontrolling Interests in Consolidated Financial Statements - an amendment of ARB No. 51” (“Statement No. 160”). Statement No. 160 requires that noncontrolling interests be reported as a component of shareholders’ equity; net income attributable to the parent and the noncontrolling interest be separately identified in the consolidated statement of operations; changes in a parent’s ownership interest be treated as equity transactions if control is maintained; and upon a loss of control, any gain or loss on the interest be recognized in the statement of operations. Statement No. 160 also requires expanded disclosures to clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. Statement No. 160 is effective for annual periods beginning after December 15, 2008 and should be applied prospectively. However, the presentation and disclosure requirements of the statement shall be applied retrospectively for all periods presented. The adoption of the provisions of Statement No. 160 is not anticipated to materially impact the Company’s consolidated financial position and results of operations.

In September 2006, the FASB issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“Statement No. 157”) which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Statement No. 157 applies to other accounting pronouncements that require or permit fair value measurements and does not require any new fair value measurements. In February 2008, the FASB issued FASB Staff Position 157-2, which provides for a one-year deferral of the provisions of Statement No. 157 for non-financial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a non-recurring basis. Effective March 1, 2008, the Company adopted the provisions of Statement No. 157 for financial assets and liabilities, as well as for any other assets and liabilities that are carried at fair value on a recurring basis. The adoption of the provisions of Statement No. 157 related to financial assets and liabilities and other assets and liabilities that are carried at fair value on a recurring basis did not materially impact the Company’s consolidated financial position and results of operations.

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(CONTINUED)

4.	ACQUISITIONS:

On August 29, 2006, the Company acquired the outstanding shares of DT Electronics ("DT"), an entity engaged in the electronic components distribution business in the United Kingdom. This acquisition enabled us to expand our presence in Europe. The operating results of DT are reflected in the accompanying financial statements since the date of acquisition.

The transaction provides for potential additional payments to the sellers ("Earnout") in three installments through 2009 from a guaranteed minimum of £850,000 (approximately $1,611,000) to a maximum of £2,549,000 (approximately $4,989,000), which amounts are calculated using current exchange rates. Payments of any amounts above the minimum were contingent upon the attainment of certain earnings milestones by DT during the three year period. The Company will pay the maximum Earnout since DT has achieved the earnings milestones established by the agreement. The Company has accrued $3,245,000 at May 31, 2008 for the unpaid Earnout, which is included in current liabilities.

5.	PROPERTY, PLANT AND EQUIPMENT:

Property, plant and equipment consists of the following:

	May 31, 2008		February 29, 2008

Furniture, fixtures and office equipment	$	11,072,000	$	10,685,000
Computer equipment		9,309,000		9,222,000
Leasehold improvements		1,255,000		1,255,000
		21,636,000		21,162,000
Less: Accumulated depreciation and amortization		17,017,000		16,633,000
	$	4,619,000	$	4,529,000

Depreciation expense for the three-month periods ended May 31, 2008 and 2007 aggregated $384,000 and $371,000, respectively.

6.	EXTERNAL FINANCING:

On January 31, 2007, the Company entered into an amended and restated secured revolving line of credit agreement with eight banks (the "Lenders"), which currently provides for maximum borrowings of $150,000,000 (as amended to date, the "Revolving Credit Line"). The Revolving Credit Line provides for borrowings utilizing an asset based formula predicated on a certain percentage of outstanding domestic accounts receivable and inventory levels at any given month end. Borrowings under the Revolving Credit Line bear interest at either (i) the lead bank’s prime rate or (ii) LIBOR plus 150 basis points, at the option of the Company, through September 30, 2011, the due date of the loan. Direct borrowings under the Revolving Credit Line were $65,500,000 at May 31, 2008 and $64,300,000 at February 29, 2008. LIBOR rates ranged from 3.9% to 4.4% at May 31, 2008. As of the end of each of the fiscal periods, the Company was in compliance with all of the required bank covenants under the Revolving Credit Line.

The Company also has a receivables financing agreement with a bank in England (the "Bank Credit Line"), which provides for maximum borrowings of £2,500,000 (approximately $4,600,000) with interest at the bank's base rate plus 1.65% (7.15% at May 31, 2008). Borrowings under the Bank Credit Line were £2,339,000 ($4,595,000) at May 31, 2008.

On November 20, 2006, the Company entered into a revolving credit agreement with a Singapore bank to provide a $30,000,000 secured line of credit to the Company’s Asian subsidiaries and thereby finance the Company’s Asian operations. Borrowings under the agreement utilize an asset based formula based on a certain percentage of outstanding accounts receivable and inventory levels at any given month end. Borrowings under the Singapore credit line bear interest at SIBOR plus 1.5%. As part of this agreement, the Company must maintain a compensating balance of $2,250,000, which amount is included in other assets. At May 31, 2008, there is $5,000,000 outstanding under the Singapore credit line.

7.	ACCRUED EXPENSES:

Accrued expenses consist of the following:

	May 31, 2008		February 29, 2008

Commissions	$	1,590,000	$	2,131,000
GST		1,061,000		860,000
Payroll and related benefits		927,000		351,000
Sales returns		838,000		891,000
Professional fees		772,000		670,000
Deferred rent		276,000		347,000
Executive bonuses		207,000		323,000
Other miscellaneous expenses		4,003,000		3,042,000
Total	$	9,674,000	$	8,615,000

8.	NET INCOME PER SHARE:

Basic earnings per share is calculated by dividing net income by the weighted average shares outstanding during the period. Diluted earnings per share is calculated by dividing net income by the weighted average number of common shares used in the basic earnings per share calculation, plus the number of common shares that would be issued assuming conversion of all potentially dilutive securities outstanding. Such securities shown below, presented on a common share equivalent basis, have been included in the per share computations:

	For the Three Months Ended
	May 31, 2008		May 31, 2007
			(As Restated)
NUMERATOR:
Net income	$	1,155,000	$	1,688,000

DENOMINATOR
Basic earnings per common share - weighted-average number of common shares outstanding		17,971,317		18,217,603
Effect of dilutive stock options and restricted stock		240,212		828,732
Diluted earnings per common share - adjusted weighted-average number of common shares outstanding		18,211,529		19,046,335

The above calculation for the three months ended May 31, 2008 and May 31, 2007 excludes 1,414,250 and 165,750 options, respectively, as their effect was antidilutive.

9.	STOCK BASED COMPENSATION:

The Company follows the provisions of FASB Statement No. 123 (revised 2004), “Share-Based Payment” (“SFAS 123(R)”), which established the accounting for share-based compensation awards exchanged for employee services and requires companies to expense the estimated fair value of these awards over the requisite employee service period.

Stock Options

Stock options granted to date under each of the Company’s 1998 and 2000 Stock Option Plans, 2000 Key Employee Stock Option Plan and 2002 Key Employee Stock Incentive Plan generally expire ten years after the date of grant and become exercisable in two equal annual installments commencing one year from date of grant. Stock options granted under the Company’s Outside Director Stock Option Plan and 2000 and 2002 Outside Directors’ Stock Option Plans expire ten years after the date of grant and become exercisable in three equal annual installments on the date of grant and the succeeding two anniversaries thereof. The exercise price for options cannot be less than the fair market value of the Company’s common stock on the date of grant.

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(CONTINUED)

9.	STOCK BASED COMPENSATION (Continued):

The following information relates to the stock option activity for the three months ended May 31, 2008:

Options	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
Outstanding at March 1, 2008		2,159,818		$	6.90
Granted		0		$	-
Exercised		(90,794	)	$	3.89
Forfeited		0		$	-

Outstanding at May 31, 2008		2,069,024		$	7.03		3.6 years	$	1,169,594
Exercisable at May 31, 2008		2,009,024		$	6.94		3.4 years	$	1,169,594

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the first quarter of fiscal 2009 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on May 31, 2008. This amount changes based on the fair market value of the Company’s common stock. The total intrinsic value of options exercised for the three months ended May 31, 2008 and 2007 was $502,000 and $25,000, respectively.

Cash received from option exercises during the three months ended May 31, 2008 and 2007 was $355,000 and $20,000, respectively, and is included within the financing activities section in the accompanying consolidated statements of cash flows.

Restricted Stock

Subject to the terms and conditions of the 2002 Key Employee Stock Incentive Plan, as amended, the compensation committee may grant shares of restricted stock. Shares of restricted stock awarded may not be sold, transferred, pledged or assigned until the end of the applicable period of restriction established by the compensation committee and specified in the award agreement. Compensation expense is recognized on a straight-line basis as shares become free of forfeiture restrictions (i.e., vest), historically over a five- or seven-year period. For the three-month periods ended May 31, 2008 and 2007, the Company recorded compensation expense aggregating $197,000 and $138,000, respectively, relating to the issuance of restricted stock.

Summary of Non-Vested Shares

The following information summarizes the changes in non-vested restricted stock for the three months ended May 31, 2008:

	Shares		Weighted Average Grant Date Fair Value
Non-vested shares at March 1, 2008		453,284	$	10.63
Granted		-		-
Vested		48,515		10.26
Forfeited		2,286		11.56
Non-vested shares at May 31, 2008		402,483		10.67

As of May 31, 2008, there was total unrecognized compensation cost of $4,391,000 related to non-vested shares and stock options which is expected to be recognized over a weighted average period of three years.

NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(CONTINUED)

10.

BUSINESS SEGMENT AND GEOGRAPHIC INFORMATION:

Management believes that the Company is operating in a single business segment, distribution of electronic components, in accordance with the rules of SFAS No. 131 (“Disclosure About Segments of an Enterprise and Related Information”).

For the three months ended May 31, 2008 and 2007, approximately 65% and 75%, respectively, of the Company’s business was conducted in North America, while the remaining operations are conducted overseas through foreign subsidiaries.

The following table presents revenue by geographic area:

	May 31, 2008		May 31, 2007

North America	$	130,357,000	$	131,710,000
Europe		16,848,000		11,094,000
Asia/Pacific		52,947,000		32,428,000
	$	200,152,000	$	175,232,000

Total assets, by geographic area, as of the first quarter ended in each of our last two fiscal years are as follows:

	May 31, 2008		May 31, 2007
			(As Restated)
North America	$	232,938,000	$	181,308,000
Europe		21,394,000		35,486,000
Asia/Pacific		70,810,000		75,229,000
	$	325,142,000	$	292,023,000

Long lived assets (net), by geographic area, as of the first quarter ended in each of our last two fiscal years are as follows:

	May 31, 2008		May 31, 2007
			(As Restated)
North America	$	3,991,000	$	4,178,000
Europe		206,000		60,000
Asia/Pacific		422,000		619,000
	$	4,619,000	$	4,857,000

11.

COMPREHENSIVE INCOME:

Comprehensive income includes certain gains and losses that, under U.S. GAAP, are excluded from net income, as these amounts are recorded directly as an adjustment to shareholders' equity. Our comprehensive income primarily includes net income and foreign currency translation adjustments. Comprehensive income for the three months ended May 31, 2008 and 2007, is as follows:

	For the Three Months Ended
	May 31, 2008		May 31, 2007
			(As Restated)
Net income	$	1,155,000	$	1,688,000
Other comprehensive income (loss)		27,000		(42,000	)
Total comprehensive income	$	1,182,000	$	1,646,000

Report of Independent Registered Public Accounting Firm

To The Board of Directors and Shareholders

Nu Horizons Electronics Corp.

We have reviewed the consolidated condensed balance sheet of Nu Horizons Electronics Corp. and subsidiaries (the Company) as of May 31, 2008, and the related consolidated condensed statements of operations and cash flows for the three-month period then ended. These financial statements are the responsibility of the Company’s management. The condensed consolidated statements of operations and cash flows of Nu Horizons Electronics Corp. for the three-month period ended May 31, 2007 were reviewed by other accountants whose report dated July 3, 2007 (November 21, 2007, as to the restatement discussed in Note 2 and the subsequent events discussed in Note 10) stated that they were not aware of any material modifications that should be made to those statements for them to be in conformity with U.S. generally accepted accounting principles.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the consolidated condensed financial statements referred to above for them to be in conformity with U.S. generally accepted accounting principles.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board, the consolidated balance sheet of Nu Horizons Electronics Corp. as of February 29, 2008, and the related consolidated statements of operations, shareholders’ equity, and cash flows for the year then ended (not presented herein); and in our report dated May 12, 2008, we expressed an unqualified opinion on those consolidated financial statements and included an explanatory paragraph for the Company's adoption of FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes - An Interpretation of FASB Statement No. 109," effective March 1, 2007, and the Company's adoption of Statement of Financial Accounting Standards No. 123(R), "Share-Based Payment," as Revised, effective March 1, 2006. In our opinion, the information set forth in the accompanying consolidated condensed balance sheet as of February 29, 2008 is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.

/s/ ERNST & YOUNG LLP

Melville, New York

July 9, 2008

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

As used in this Report, "we," "us," "our," "Nu Horizons" or "the Company" means Nu Horizons Electronics Corp. and its subsidiaries unless the context indicates a different meaning.

Forward Looking Statements:

Statements in this Form 10-Q quarterly report may be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements that express the Company’s intentions, beliefs, expectations, strategies, predictions or any other statements relating to its future activities or other future events or conditions. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including those risks discussed from time to time in the Company’s Annual Report on Form 10-K for the year ended February 29, 2008, and in other documents which the Company files with the Securities and Exchange Commission. In addition, such statements could be affected by risks and uncertainties related to product demand, market and customer acceptance, competition, government regulations and requirements, pricing and development difficulties, as well as general industry and market conditions and growth rates, and general economic conditions. Any forward-looking statements speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this Form 10-Q.

For a description of the Company's critical accounting policies and an understanding of the significant factors that influenced the Company's performance during the three month periods ended May 31, 2008 and 2007, this Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") should be read in conjunction with the consolidated condensed financial statements, including the related notes, appearing in Item 1 of this Report, as well as the Company's Annual Report on Form 10-K for the year ended February 29, 2008.

Overview:

Nu Horizons Electronics Corp. and its wholly-owned subsidiaries are engaged in the distribution of high technology active and passive electronic components to a wide variety of original equipment manufacturers (“OEMs”) of electronic products. Active components distributed by the Company include semiconductor products such as memory chips, microprocessors, digital and linear circuits, microwave/RF and fiberoptic components, transistors and diodes. Passive components distributed by NIC, and majority-owned subsidiaries NIA and NIE, principally to OEMs and other distributors nationally, consist of a high technology line of chip and leaded components including capacitors, resistors, inductors and circuit protection components. NIC, NIA and NIE are a prime source of qualified products by over 9,000 OEMs in the United States. In addition, the Company distributes IBM and Sun Microsystems boards, servers, storage and software to OEMs (referred to herein as "Systems").

In recent years, there has been a shift in production to Asia due to lower cost. The Company recognized the industry shift to overseas production and the need to serve its suppliers on a global basis. As a result, the Company adopted a strategy of expanding its Asian and European operations by investing in human resources and expanding its sales force and engineering personnel. In prior years, we invested in Asia and currently we are staffed with 204 employees in 19 offices, with a warehouse in Singapore and Hong Kong. Sales in Asia for the quarter ended May 31, 2008 are 63% higher than the same period of the prior fiscal year. In fiscal 2007, we continued our growth strategy of expanding our European presence by acquiring DT Electronics Limited on August 29, 2006, with 37 employees and a warehouse in Coventry, England. Sales in the United Kingdom have increased 31% over the prior year quarter. In fiscal 2008, we opened our first office in Munich, Germany and on June 6, 2007, the Company acquired Dacom Süd Electronics Vertriebs GmbH ("Dacom"), a franchised electronics component distributor, based in Munich, Germany. Our Germany operations are currently considered a "start-up" investment and are not expected to attain profitable operations until fiscal 2010.

During fiscal 2008, we restructured our Systems business by focusing the business on higher margin value-added engagements with mid-tier customers and creating a new selling organization. System sales for the quarter ended May 31, 2008 have increased 8.5% over the same period of the prior year. System gross profit increased to 11.1% from 7.8% for the respective periods.

It is difficult for the Company, as a distributor, to forecast the material trends of the electronic component and computer products industry because the Company does not typically have material forward-looking information available from its customers and suppliers. As such, management relies on the publicly available information published by certain industry groups and other related analyses to evaluate its longer term prospects.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview (continued):

The Company is continuing to cooperate with the inquiry by the Securities and Exchange Commission ("SEC") and to conduct its own related internal investigation under the direction of the Audit Committee in the action captioned "In the Matter of Vitesse Semiconductor Corp." (referred to herein as the "Vitesse Matter"). The cost of such cooperation and investigation has required the Company to incur significant expenses for professional fees and related expenses. Approximately $970,000 and $302,000 was incurred for professional fees for the first quarter of fiscal years 2009 and 2008, respectively. Cumulatively, $3,400,000 of expense for professional fees has been incurred to date since fiscal 2008 related to the Vitesse Matter. Management is presently unable to determine the duration of the SEC inquiry and the Company's related internal investigation and, consequently, the total costs that will be incurred by the Company. Nevertheless, management expects that the Company will continue to incur costs at levels comparable to fiscal 2008 through the second quarter of fiscal 2009.

The tables below provide a quarter-over-quarter summary of sales for the Company:

Quarterly Analysis of Sales

	Quarters Ended May 31,								Percentage Change
	2008		% of Total		2007		% of Total		2008 to 2007

Sales by Type:
Electronic Components	$	185,922,000		93%	$	162,114,000		93%		15	%
Systems		14,230,000		7%		13,118,000		7%		8	%
	$	200,152,000		100%	$	175,232,000		100%		14	%

The following table sets forth for the quarter ended May 31, 2008 and 2007, certain items in the Company’s consolidated statements of operations expressed as a percentage of net sales.

	Three Months Ended May 31,
	2008			2007
Net sales		100.0	%		100.0	%
Cost of sales		84.5			83.1
Gross profit		15.5			16.9
Operating expenses		14.1			14.6
Interest expense		.6			.5
Interest (income)		(.1	)		-
Income before taxes and minority interest		.9			1.7
Income tax provision		.3			.7
Minority interests		.1			.1
Net income		.6			1.0

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results of Operations:

Three Months Ended May 31, 2008 compared to Three Months Ended May 31, 2007

Sales for the three month period ended May 31, 2008 were $200,152,000 as compared to $175,232,000 for the comparable period of the prior year, an increase of $24,920,000 or 14%.

Sales of electronic components, excluding Systems, for the three month period ended May 31, 2008 were $185,922,000 as compared to $162,114,000 for the comparable period of the prior year, an increase of approximately $23,808,000 or 15%. Management believes that this sales increase is primarily due to increased market share in Asia/Pacific and Europe and the expansion of its line card and customer base. The lack of near term visibility in the electronics manufacturing and the electronics distribution industry makes it difficult for management to estimate the Company’s overall sales volume and earnings for the balance of the Company’s current fiscal year. Management believes, however, that the industry growth rate in the near term will likely be in the low single digits. System sales for the quarter ended May 31, 2008 were $14,230,000, compared to $13,118,000 in 2007, an increase of 8.5%.

The gross profit margin for the first quarter of fiscal 2009 was 15.5% as compared to 16.9% in the prior year. The decline in gross margin experienced in the quarter resulted primarily from lower supplier discounts, as well as increased freight cost, product mix and lower margins associated with increased order size, in conjunction with increased sales in the Asia/Pacific market which requires lower selling prices to secure high volume business from large Asian contract manufacturers.

As a percentage of sales, operating expenses decreased to 14.1% from 14.6% in the comparable period of the prior year. Operating expenses increased $2,486,000 or 10% over the prior period due to: (i) $1,216,000 increase in professional fees related primarily to the Vitesse Matter and increased audit fees, (ii) $431,000 of increased personnel costs including salary, commission, travel and fringe benefits related to new hires, principally for our start-up in Germany, and (iii) $839,000 increase in other selling and general and administrative expenses.

Interest expense increased to $1,120,000 for the three months ended May 31, 2008 from $928,000 for the prior period. This increase in interest expense resulted from larger bank borrowing balances incurred to support increases in both accounts receivable and inventories resulting from higher sales.

The consolidated effective tax rate for the three months ended May 31, 2008 is 31.0% as compared to 41.3% for the three months ended May 31, 2007. The consolidated effective rate was higher in the prior year quarter and fiscal 2008 due to the penalties and interest associated with the correction of errors in our United States Federal and State tax returns discussed in Note 2 of the financial statements contained in Item 1 herein. The fiscal 2009 consolidated effective tax rate is lower than United States statutory rates due primarily to lower foreign income tax rates resulting from the election to permanently reinvest foreign income in the operations in foreign countries.

Net income for the three month period ended May 31, 2008 was $1,155,000 or $.06 per basic and diluted share as compared to a net income of $1,688,000 or $.09 per basic and diluted share for the three month period ended May 31, 2007.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Liquidity and Capital Resources:

The Company's current ratio was 3.2:1 at May 31, 2008 and 3.6:1 at February 29, 2008. Working capital increased to $208,018,000 at May 31, 2008 from $204,456,000 at February 29, 2008.

On January 31, 2007, the Company entered into an amended and restated secured revolving line of credit agreement, as amended, with eight banks, which currently provides for maximum borrowings of $150,000,000 (the "Revolving Credit Line"). The Revolving Credit Line provides for borrowings utilizing an asset based formula predicated on a certain percentage of outstanding domestic accounts receivable and inventory levels at any given month end. Based on the asset based formula, the Company may not be able to borrow the maximum amount available under its Revolving Credit Line at all times. Borrowings under the Revolving Credit Line bear interest at either (i) the lead bank’s prime rate or (ii) LIBOR plus 150 basis points, at the option of the Company, through September 30, 2011, the due date of the loan. Direct borrowings under the Revolving Credit Line were $65,500,000 at May 31, 2008 and $64,300,000 at February 29, 2008. As of the end of each of the fiscal periods, the Company was in compliance with all of the required bank covenants.

The Company also has a receivable financing agreement (the "Bank Credit Line") with a bank in England which provides for maximum borrowings of £2,500,000 (approximately $4,600,000) which bear interest at the bank's base rate plus 1.65%. The interest rate at May 31, 2008 was 7.15%. The Company owed $4,595,000 and $603,000 at May 31, 2008 and February 29, 2008, respectively.

On November 20, 2006, the Company entered into a revolving credit agreement with a Singapore bank to provide a $30,000,000 secured line of credit to the Company’s Asian subsidiaries and thereby finance the Company’s Asian operations. Borrowings under the agreement utilize an asset based formula based on a certain percentage of outstanding accounts receivable and inventory levels at any given month end. Borrowings under the Singapore credit line bear interest at SIBOR plus 1.5 percent. Direct borrowings under the Singapore Credit Line were $5,000,000 at May 31, 2008 and February 29, 2008.

At May 31, 2008, the Company had approximately $58,000,000 in the aggregate available under all of its bank credit facilities.

The Company anticipates that its resources provided by its cash flow from operations and the aforementioned agreements will be sufficient to meet its financing requirements for at least the next twelve-month period.

Off-Balance Sheet Arrangements:

As of May 31, 2008, the Company had no off-balance sheet arrangements.

Critical Accounting Policies and Estimates:

There have been no changes in our critical accounting policies from those disclosed in Item 8 of our Annual Report on Form 10-K for the year ended February 29, 2008.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

All of the Company’s bank debt and the associated interest expense are sensitive to changes in the level of interest rates. The Company’s credit facilities bear interest based on interest rates tied to the prime lending rate, LIBOR or SIBOR rate, any of which may fluctuate over time based on economic conditions. A hypothetical 100 basis point (one percentage point) increase in interest rates would have resulted in incremental interest expense of approximately $196,000 for the three-month period ended May 31, 2008. As a borrower, the Company is subject to the risk associated with fluctuating interest rates and therefore, could incur increased interest expense.

The Company has several foreign subsidiaries in Asia, the United Kingdom, Germany and Canada. The Company does business in more than one dozen countries and for the three months ended May 31, 2008 generated approximately 35% of its revenue from outside North America. The Company’s ability to sell its products in foreign markets may be affected by changes in economic, political or market conditions in the foreign markets in which the Company does business.

The Company’s total assets in its foreign subsidiaries were $92,204,000 and $110,715,000 at May 31, 2008 and 2007, respectively, translated into U.S. dollars at the closing exchange rates. The Company also acquires certain inventory from foreign suppliers and as such, faces risk due to adverse movements in foreign currency exchange rates. These risks could have an impact on the Company’s results in future periods. The potential loss based on end of period balances and prevailing exchange rates resulting from a hypothetical 10% strengthening of the U.S. dollar against foreign currencies was not material in the quarter ended May 31, 2008. The Company does not currently employ any currency derivative instruments, futures contracts or other currency hedging techniques to mitigate its risks in this regard.

The electronic component industry is cyclical which can cause significant fluctuations in sales, gross profit margins and profits, from year to year. For example, during calendar 2001, the industry experienced a severe decline in the demand for electronic components, which caused sales to decrease by 56%. The prior year reflected a 74% increase in net sales. It is difficult to predict the timing of the changing cycles in the electronic component industry.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of management, including our Chairman and Chief Executive Officer ("CEO") and our Executive Vice President-Finance and Chief Financial Officer ("CFO"), we evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), as of the end of the period covered by this quarterly report. Based on this evaluation, our CEO and CFO concluded that as of May 31, 2008 our disclosure controls and procedures were effective in ensuring that the information required to be filed in this report has been recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms and that information is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the quarter ended May 31, 2008 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations of the Effectiveness of Internal Control

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of internal control system are met. Because of the inherent limitations of any internal control system, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected.

PART II. OTHER INFORMATION

ITEM 1.

Legal Proceedings.

None.

ITEM 1A.

Risk Factors.

There have not been any material changes to the Company’s risk factors as discussed in Item 1A - Risk Factors in the Company’s Annual Report on Form 10-K for the year ended February 29, 2008.

ITEM 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

None.

ITEM 3.

Defaults Upon Senior Securities.

None.

ITEM 4.

Submission of Matters to a Vote of Security Holders.

None.

ITEM 5.

Other Information.

Item 1.01 Entry Into Material Definitive Agreement

On July 8, 2008, the Company entered into new Indemnification Agreements with each of its directors (namely Messrs. Freudenberg, Gardner, Nadata, Novick, Polimeni, Schuster and Siegel, each an “Indemnitee”). The Indemnification Agreements supersede the existing, previously-disclosed indemnification agreements between the Company and each of its directors and are intended to supplement certain of the provisions of the existing agreements.

Pursuant to the Indemnification Agreements, the Company has agreed to provide indemnification to each Indemnitee if, by reason of his status with the Company, he is, or is threatened to be made, a party to or otherwise involved in any threatened, pending or completed civil, criminal, administrative or investigative proceeding, including a proceeding by or in the right of the Company. The Indemnification Agreements provide for the advancement of expenses to the Indemnitee, subject to his delivery of an undertaking to repay any expenses advanced if and to the extent it is ultimately determined that he is not entitled to be indemnified against such expenses.

Each of the Indemnitees serves as a director of the Company. In addition, each of Messrs. Freudenberg, Nadata and Schuster serve as officers of the Company and its subsidiaries. The Company is a party to agreements with each of Messrs. Nadata, Schuster and Freudenberg which govern certain terms of their respective employment relationships.

PART II. OTHER INFORMATION

ITEM 6.

Exhibits:

3.1		Certificate of Incorporation, as amended (Incorporated by Reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the Quarter ended November 30, 2000).

3.2		By-laws, as amended (Incorporated by Reference to Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the year ended February 29, 1988).

4.1		Specimen Common Stock Certificate (Incorporated by Reference as Exhibit 4.1 to the Company’s Registration Statement on Form S-1, Registration No. 2-89176).

10.1		Form of Indemnification Agreement between the Company and each of Messrs. Freudenberg, Gardner, Nadata, Novick, Polimeni, Schuster and Siegel dated July 8, 2008.

31.1		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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.

	Nu Horizons Electronics Corp.
	Registrant


Date: July 9, 2008	/s/ Arthur Nadata
	Arthur Nadata
	Chairman and Chief Executive Officer


Date: July 9, 2008	/s/ Kurt Freudenberg
	Kurt Freudenberg
	Executive Vice President
	and Chief Financial Officer

EXHIBIT INDEX

Exhibits:

3.1		Certificate of Incorporation, as amended (Incorporated by Reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the Quarter ended November 30, 2000).

3.2		By-laws, as amended (Incorporated by Reference to Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the year ended February 29, 1988).

4.1		Specimen Common Stock Certificate (Incorporated by Reference as Exhibit 4.1 to the Company’s Registration Statement on Form S-1, Registration No. 2-89176).

10.1		Form of Indemnification Agreement between the Company and each of Messrs. Freudenberg, Gardner, Nadata, Novick, Polimeni, Schuster and Siegel dated July 8, 2008.

*31.1		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

*31.2		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

*32.1		Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*32.2		Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*Included herewith.