-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UccZJ1MegFgDaqRlGWLfipxT475mFAzH7G+4cuXtVDd2j/T/PH9FaXl49yIfrXsM IsA2DfCQT6gCU+6754ZxfA== 0000890566-00-000815.txt : 20000516 0000890566-00-000815.hdr.sgml : 20000516 ACCESSION NUMBER: 0000890566-00-000815 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000515 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EQUUS II INC CENTRAL INDEX KEY: 0000878932 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 760345915 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-11362 FILM NUMBER: 635622 BUSINESS ADDRESS: STREET 1: 2929 ALLEN PKWY STE 2500 CITY: HOUSTON STATE: TX ZIP: 77019 BUSINESS PHONE: 7135290900 MAIL ADDRESS: STREET 1: 2929 ALLEN PARKWAY STREET 2: STE 2500 CITY: HOUSTON STATE: TX ZIP: 77019 10-Q 1 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 March 31, 2000 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-19509 EQUUS II INCORPORATED ----------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 76-0345915 ------------------------------- ------------------ (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2929 ALLEN PARKWAY, SUITE 2500 HOUSTON, TEXAS 77019-2120 ------------------------------ ----------------- (Address of principal (Zip Code) executive offices) Registrant's telephone number, including area code: (713) 529-0900 --------------- Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered COMMON STOCK NEW YORK STOCK EXCHANGE Securities registered pursuant to Section 12(g) of the Act: None 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 [ ] Approximate aggregate market value of common stock held by non-affiliates of the registrant: $52,013,125 computed on the basis of $10.063 per share, closing price of the common stock on the New York Stock Exchange Inc. on May 11, 2000. For the purpose of calculating this amount only, all directors and executive officers of the registrant have been treated as affiliates. There were 6,648,204 shares of the registrant's common stock, $.001 par value, outstanding, as of May 11, 2000. The net asset value of a share at March 31, 2000 was $17.06. Documents incorporated by reference: None EQUUS II INCORPORATED (A Delaware Corporation) INDEX PART I. FINANCIAL INFORMATION PAGE ---- Item 1. Financial Statements Balance Sheets - March 31, 2000 and December 31, 1999....................... 1 Statements of Operations - For the three months ended March 31, 2000 and 1999......... 2 Statements of Changes in Net Assets - For the three months ended March 31, 2000 and 1999......... 3 Statements of Cash Flows - For the three months ended March 31, 2000 and 1999......... 4 Selected Per Share Data and Ratios - For the three months ended March 31, 2000 and 1999 ........ 6 Schedule of Portfolio Securities - March 31, 2000............................................. 7 Notes to Financial Statements................................ 12 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.......................... 17 Item 3. Quantitative and Qualitative Disclosure about Market Risk.... 20 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K ............................ 21 SIGNATURE................................................................... 21 ii PART I. FINANCIAL STATEMENTS ITEM 1. FINANCIAL STATEMENTS EQUUS II INCORPORATED BALANCE SHEETS MARCH 31, 2000 AND DECEMBER 31, 1999 (Unaudited)
2000 1999 ------------- ------------- ASSETS Investments in portfolio securities at fair value (cost $114,852,854 and $116,473,793, respectively) ...... $ 113,796,152 $ 115,373,205 Temporary cash investments, at cost which approximates fair value ................................. 45,359,640 50,334,180 Cash ......................................................... 5,268 5,485,502 Accounts receivable .......................................... 15,796 1,050,606 Accrued interest receivable .................................. 3,184,067 2,778,922 ------------- ------------- Total assets ....................................... 162,360,923 175,022,415 ------------- ------------- LIABILITIES AND NET ASSETS Liabilities: Accounts payable ........................................ 562,554 696,501 Due to management company ............................... 505,962 507,094 Notes payable to bank ................................... 60,100,000 72,400,000 ------------- ------------- Total liabilities .................................. 61,168,516 73,603,595 ------------- ------------- Commitments and contingencies Net assets: Preferred stock, $.001 par value, 5,000,000 shares authorized, no shares outstanding .................... -- -- Common stock, $.001 par value, 25,000,000 shares authorized, 6,662,600 and 6,839,331 shares outstanding 6,662 6,839 Additional paid-in capital .............................. 101,668,792 102,676,963 Notes receivable from officers related to ............... (10,132,925) (10,132,925) 731,662 shares of common stock Undistributed net investment income ..................... -- -- Undistributed net capital gains ......................... 10,706,580 9,968,531 Unrealized depreciation of portfolio securities, net .... (1,056,702) (1,100,588) ------------- ------------- Total net assets ................................... $ 101,192,407 $ 101,418,820 ============= ============= Net assets per share ............................... $ 17.06 $ 16.61 ============= =============
The accompanying notes are an integral part of these financial statements 1 EQUUS II INCORPORATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999 (Unaudited)
2000 1999 ------------ ------------ Investment income: Income from portfolio securities .............................. $ 1,695,481 $ 1,152,787 Interest from temporary cash investments ...................... 26,172 23,050 Interest on notes receivable from officers .................... 24,579 -- ------------ ------------ Total investment income .................................. 1,746,232 1,175,837 ------------ ------------ Expenses: Management fees ............................................... 505,962 536,345 Director fees and expenses .................................... 59,383 51,675 Professional fees ............................................. 53,171 62,381 Administrative fees ........................................... 12,500 12,500 Mailing, printing and other expenses .......................... 18,560 24,031 Interest expense .............................................. 389,681 718,170 Franchise taxes ............................................... 3,700 11,620 ------------ ------------ Total expenses ........................................... 1,042,957 1,416,722 ------------ ------------ Net investment income (loss) ....................................... 703,275 (240,885) ------------ ------------ Realized gain on sales of portfolio securities, net ................ 738,049 2,932,804 ------------ ------------ Unrealized appreciation (depreciation) of portfolio securities, net: End of period ................................................. (1,056,702) 32,733,681 Beginning of period ........................................... (1,100,588) 44,311,697 ------------ ------------ Increase (decrease) in unrealized appreciation, net ........... 43,886 (11,578,016) ------------ ------------ Total increase (decrease) in net assets from operations ....... $ 1,485,210 $ (8,886,097) ============ ============
The accompanying notes are an integral part of these financial statements 2 EQUUS II INCORPORATED STATEMENTS OF CHANGES IN NET ASSETS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999 (Unaudited)
2000 1999 ------------- ------------- Operations: Net investment income (loss) .................... $ 703,275 $ (240,885) Realized gain on sales of portfolio securities, net .............................. 738,049 2,932,804 Increase (decrease) in unrealized appreciation of portfolio securities, net .................... 43,886 (11,578,016) ------------- ------------- Increase (decrease) in net assets from operations .... 1,485,210 (8,886,097) ------------- ------------- Capital Transactions: Interest on non-recourse portion of officer notes 111,972 -- Repurchase shares of common stock ............... (1,823,595) -- ------------- ------------- Decrease in net assets from capital transactions ..... (1,711,623) -- ------------- ------------- Decrease in net assets ............................... (226,413) (8,886,097) Net assets at beginning of period .................... 101,418,820 116,155,028 ------------- ------------- Net assets at end of period .......................... $ 101,192,407 $ 107,268,931 ============= =============
The accompanying notes are an integral part of these financial statements 3 EQUUS II INCORPORATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999 (Unaudited)
2000 1999 ------------ ------------ Cash flows from operating activities: Interest and dividends received ................... $ 1,015,960 $ 578,356 Cash paid to management company, directors, bank and suppliers ............................. (1,182,501) (1,576,847) ------------ ------------ Net cash used by operating activities .......... (166,541) (998,491) ------------ ------------ Cash flows from investing activities: Purchase of portfolio securities .................. (1,914,311) (5,704,578) Proceeds from sales of portfolio securities ....... 996,364 4,022,245 Principal payments from portfolio companies ....... 3,722,349 1,043,500 Advance to portfolio company ...................... -- (24,483) Repayment from portfolio company .................. 35,334 250,000 ------------ ------------ Net cash provided (used) by investing activities 2,839,736 (413,316) ------------ ------------ Cash flows from financing activities: Advances from bank ................................ 48,950,000 59,750,000 Repayments to bank ................................ (61,250,000) (61,350,000) Repurchase of common stock ........................ (1,813,107) -- Payments received on officer notes ................ 991,161 -- Dividend payments ................................. (6,023) -- ------------ ------------ Net cash used by financing activities .......... (13,127,969) (1,600,000) ------------ ------------ Net decrease in cash and cash equivalents .............. (10,454,774) (3,011,807) Cash and cash equivalents at beginning of period ....... 55,819,682 60,253,990 ------------ ------------ Cash and cash equivalents at end of period ............. $ 45,364,908 $ 57,242,183 ============ ============
The accompanying notes are an integral part of these financial statements 4 EQUUS II INCORPORATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999 (Unaudited) (Continued)
2000 1999 ------------ ------------ Reconciliation of increase (decrease) in net assets from operations to net cash used by operating activities: Increase (decrease) in net assets from operations ............. $ 1,485,210 $ (8,886,097) Adjustments to reconcile increase (decrease) in net assets from operations to net cash used by operating activities: Realized gain on sale of portfolio securities, net ....... (738,049) (2,932,804) (Increase) decrease in unrealized appreciation, net ...... (43,886) 11,578,016 Accrued interest and dividends exchanged for portfolio securities ................................. (437,099) (519,880) Increase in accrued interest receivable .................. (405,145) (77,601) Interest income on non-recourse .......................... 111,972 -- portion of officer notes Amortization of commitment fee ........................... -- 9,375 Decrease in accounts payable ............................. (138,412) (125,070) Decrease in due to management company .................... (1,132) (44,430) ------------ ------------ Net cash used by operating activities ......................... $ (166,541) $ (998,491) ============ ============
The accompanying notes are an integral part of these financial statements 5 EQUUS II INCORPORATED SUPPLEMENTAL INFORMATION - SELECTED PER SHARE DATA AND RATIOS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999 (Unaudited)
2000 1999 -------- -------- Investment income ......................................... $ 0.29 $ 0.24 Expenses .................................................. 0.17 0.29 -------- -------- Net investment income (loss) .............................. 0.12 (0.05) Realized gain on sale of portfolio securities, net ........ 0.12 0.59 Increase (decrease) in unrealized appreciation of portfolio securities, net ............................ -- (2.34) -------- -------- Increase (decrease) in net assets from operations ......... 0.24 (1.80) -------- -------- Capital Transactions: Interest on non-recourse portion of officer notes ......... 0.02 -- Effect of common stock repurchase ......................... 0.19 -- -------- -------- Increase in net assets from capital transactions .......... 0.21 -- -------- -------- Net increase (decrease) in net assets ..................... 0.45 (1.80) Net assets at beginning of period ......................... 16.61 23.45 -------- -------- Net assets at end of period ............................... $ 17.06 $ 21.65 ======== ======== Ratio of expenses to average net assets ................... 1.03% 1.27% Ratio of net investment income (loss) to average net assets 0.69% (0.22)% Ratio of increase (decrease) in net assets from operations to average net assets ................................ 1.47% (7.95)%
The accompanying notes are an integral part of these financial statements 6 EQUUS II INCORPORATED SCHEDULE OF PORTFOLIO SECURITIES MARCH 31, 2000 (Unaudited)
DATE OF PORTFOLIO COMPANY INITIAL INVESTMENT COST FAIR VALUE ----------------- ------------------ --------- ---------- A. C. Liquidating Corporation February 1985 -10% secured promissory notes $ 188,014 $ -- Allied Waste Industries, Inc. March 1989 -900,000 shares of common stock 3,121,565 5,679,844 Champion Window, Inc. March 1999 -1,400,000 shares of common stock 1,400,000 4,550,000 -20,000 shares of preferred stock 2,000,000 2,157,500 -12% subordinated promissory note 3,500,000 3,500,000 Container Acquisition, Inc. February 1997 -1,370,000 shares of common stock 1,370,000 3,870,000 -61,178 shares of preferred stock 6,117,800 6,117,800 -Conditional warrant to buy up to 370,588 shares of common stock at $0.01 per share through June 2003 1,000 1,000 The Drilltec Corporation August 1998 -1,400,000 shares of common stock 1,400,000 -- -62,450 shares of preferred stock 6,245,000 -- -Prime +9.75% promissory note 764,000 764,000 -Warrant to buy 10% of the common equity for $100 through September 2002 -- -- Drypers Corporation (NASDAQ - DYPR) July 1991 -3,677,906 shares of common stock 9,328,556 5,662,585 Equicom, Inc. July 1997 -452,000 shares of common stock 141,250 -- -657,611 shares of preferred stock 6,576,110 2,000,000 -10% promissory note 2,138,500 2,138,500 Equipment Support Services, Inc. December 1999 -35,000 shares of common stock 101,500 101,500 -35,000 shares of preferred stock 1,929,000 1,929,000 -8% promissory note 1,138,000 1,138,000 Equus Video Corporation January 1998 10,000 shares of common stock 25,000 20,000 GCS RE, Inc. February 1989 -1,000 shares of common stock 132,910 300,000
The accompanying notes are an integral part of these financial statements 7 EQUUS II INCORPORATED SCHEDULE OF PORTFOLIO SECURITIES MARCH 31, 2000 (UNAUDITED)
DATE OF PORTFOLIO COMPANY INITIAL INVESTMENT COST FAIR VALUE ----------------- ------------------ ---------- ----------- Hot & Cool Holdings, Inc. March 1996 -9% subordinated note $1,075,000 $ -- -10% subordinated notes 2,200,000 1,100,000 -12% promissory notes 2,500,000 2,500,000 -19,665 shares of Series A 8% preferred stock 786,631 -- -6,000 shares of Series B 8% preferred stock 300,000 -- -Warrants to buy up to 14,942 shares of common stock at $0.01 per share through March 2006 -- -- -Warrants to buy up to 16,316 shares of common stock at $26.00 per share through April 2007 -- -- -Warrant to buy 10,000 shares of common stock at $0.01 through February 28, 2003 -- -- LG&E Energy Corp. (NYSE - LGE) July 1999 -121,504 shares of common stock 1,719,838 2,529,258 -Earnout on sale of CRC Holding Corp. 2,114,790 4,600,000 -115,860 shares of common stock in escrow 1,639,409 2,411,771 NCI Building Systems, Inc. April 1989 (NYSE - NCS) -200,000 shares of common stock 159,784 3,762,500 Paracelsus Healthcare Corporation December 1990 (NYSE - PLS) -2,018,213 shares of common stock 5,278,748 418,631 Petrocon Engineering, Inc. September 1998 -12% promissory note 4,663,356 4,663,356 -887,338 shares of common stock 635 635 -8% Series B junior subordinated promissory note 2,659,332 2,659,332 -Warrant to buy up to 1,552,571 shares of common stock at $0.01 per share through March 2009 -- --
The accompanying notes are an integral part of these financial statements 8 EQUUS II INCORPORATED SCHEDULE OF PORTFOLIO SECURITIES MARCH 31, 2000 (UNAUDITED)
DATE OF PORTFOLIO COMPANY INITIAL INVESTMENT COST FAIR VALUE ----------------- ------------------ ---------- ----------- Raytel Medical Corporation August 1997 (NASDAQ - RTEL) -33,073 shares of common stock $ 330,730 $ 103,353 The ServiceMaster Company May 1999 (NYSE-SVM) -Warrant to buy up to 29,411 shares of common stock at $51 per share through September 2001 -- -- Sovereign Business Forms, Inc. August 1996 -14,977 shares of preferred stock 1,497,700 1,497,700 -15% promissory notes 2,525,399 2,525,399 -Warrant to buy 551,894 shares of of common stock at $1 per share through August 2006 -- 413,920 -Warrant to buy 25,070 shares of common stock at $1.25 per share through October 2007 -- 12,535 -Warrant to buy 273,450 shares of common stock at $1 per share through October 2009 -- 205,088 Spectrum Management, LLC December 1999 -285,000 Units of Class A equity interest 2,850,000 2,850,000 Stephen L. LaFrance Holdings, Inc. September 1997 -2,498,452 shares of preferred stock 2,498,452 2,498,452 -Warrant to buy 269 shares of common stock for $0.01 per share through September 2007 -- 4,000,000 Sternhill Partners I, LP March 2000 -3% limited partnership interest 300,000 300,000
The accompanying notes are an integral part of these financial statements 9 EQUUS II INCORPORATED SCHEDULE OF PORTFOLIO SECURITIES MARCH 31, 2000 (Unaudited)
DATE OF PORTFOLIO COMPANY INITIAL INVESTMENT COST FAIR VALUE ----------------- ------------------ ------------- ------------- Strategic Holdings, Inc. September 1995 -3,089,751 shares of common stock $ 3,088,389 $ 2,568,287 -3,822,157 shares of Series B 3,820,624 3,820,624 preferred stock -15% promissory note 6,750,000 6,750,000 -Warrants to buy 225,000 shares of common stock at $0.4643 per share through August 2005 -- 187,026 -Warrant to buy 100,000 shares of common stock at $1.50 per share through August 2005 -- -- -Warrant to buy 2,219,237 shares of common stock at $0.01 per share through November 2005 -- 1,844,687 -1,000 shares of SMIP, Inc. common stock 150,000 150,000 -15% promissory note of SMIP, Inc. 175,000 175,000 Summit/DPC Partners, L.P. October 1995 -36.11% limited partnership interest 3,326,565 10,000,000 Travis International, Inc. December 1986 -98,761 shares of common stock 5,398 1,000,000 Tulsa Industries, Inc. December 1997 -27,500 shares of common stock 33,846 -- -181,589 shares of Series A preferred stock 5,466,154 -- -1,058 shares of Series B preferred stock 1,058,000 1,058,000 -Junior participation in promissory note 655,769 655,769 Turfgrass America, Inc. May 1999 -3,167,756 shares of common stock 600,000 600,000 -12% subordinated promissory note 3,505,000 3,505,000 United Industrial Services, Inc. July 1998 -35,000 shares of preferred stock 3,500,000 2,500,000 -Warrants to buy 63,637 shares of common stock at $0.01 through June 2008 100 100 ------------- ------------- Total $ 114,852,854 $ 113,796,152 ============= =============
The accompanying notes are an integral part of these financial statements 10 EQUUS II INCORPORATED SCHEDULE OF PORTFOLIO SECURITIES MARCH 31, 2000 (Continued) Substantially all of the Fund's portfolio securities are restricted from public sale without prior registration under the Securities Act of 1933. The Fund negotiates certain aspects of the method and timing of the disposition of the Fund's investment in each portfolio company, including registration rights and related costs. In connection with the investments in Allied Waste Industries, Inc., Champion Window, Inc., Container Acquisition, Inc., The Drilltec Corporation, Drypers Corporation, Hot & Cool Holdings, Inc., Sovereign Business Forms, Inc., Strategic Holdings, Inc., Turfgrass America, Inc. and United Industrial Services, Inc. rights have been obtained to demand the registration of such securities under the Securities Act of 1933, providing certain conditions are met. The Fund does not expect to incur significant costs, including costs of any such registration, in connection with the future disposition of its portfolio securities. As defined in the Investment Company Act of 1940, at March 31, 2000, the Fund was considered to have a controlling interest in Champion Window, Inc., Container Acquisition, Inc., The Drilltec Corporation, Drypers Corporation, Equicom, Inc., Sovereign Business Forms, Inc., Spectrum Management LLC, Strategic Holdings, Inc., Tulsa Industries, Inc. and United Industrial Services, Inc. The fair values of the Fund's investments in publicly traded securities include discounts from the closing market prices to reflect the estimated effects of restrictions on the sale of such securities at March 31, 2000. Such discounts, shown in the following table, total $2,316,509 or $0.39 per share as of March 31, 2000. DISCOUNT FROM MARKET VALUE ------------- Allied Waste Industries, Inc. ........ $ 226,406 Drypers Corporation .................. 1,578,476 LG&E Energy Corporation .............. 488,673 Paracelsus Healthcare Corporation .... 22,954 ------------- Total discount ................. $ 2,316,509 ============= Income was earned in the amount of $1,028,377 and $742,654 for the three months ended March 31, 2000 and 1999, respectively, on portfolio securities of companies in which the Fund has a controlling interest. As defined in the Investment Company Act of 1940, all of the Fund's investments are in eligible portfolio companies. The Fund provides significant managerial assistance to all of the portfolio companies in which it has invested, except Equipment Support Services, Inc., LG&E Energy Corp., Raytel Medical Corporation, Sternhill Partners I, L.P. and Summit/DPC Partners, L.P. The Fund provides significant managerial assistance to portfolio companies that comprise 80% of the total value of the investments in portfolio companies at March 31, 2000. The accompanying notes are an integral part of these financial statements 11 EQUUS II INCORPORATED NOTES TO FINANCIAL STATEMENTS MARCH 31, 2000, AND 1999 (1) ORGANIZATION AND BUSINESS PURPOSE Equus II Incorporated (the "Fund"), a Delaware corporation with perpetual existence, was formed by Equus Investments II, L.P. (the "Partnership") on August 16, 1991. On July 1, 1992, the Partnership was reorganized and all of the assets and liabilities of the Partnership were transferred to the Fund in exchange for shares of common stock of the Fund. The shares of the Fund trade on the New York Stock Exchange under the symbol EQS. The Fund seeks to achieve capital appreciation by making investments in equity and equity-oriented securities issued by privately-owned companies in transactions negotiated directly with such companies. The Fund seeks to invest primarily in companies which intend to acquire other businesses, including leveraged buyouts. The Fund may also invest in recapitalizations of existing businesses or special situations from time to time. The Fund's investments in Portfolio Companies consist principally of equity securities such as common and preferred stock, but also include other equity-oriented securities such as debt convertible into common or preferred stock or debt combined with warrants, options or other rights to acquire common or preferred stock. Current income is not a significant factor in the selection of investments. The Fund elected to be treated as a business development company under the Investment Company Act of 1940, as amended. (2) MANAGEMENT The Fund has entered into a management agreement with Equus Capital Management Corporation, a Delaware corporation (the "Management Company"). Pursuant to such agreement, the Management Company performs certain services, including certain management and administrative services necessary for the operation of the Fund. The Management Company receives a management fee at an annual rate of 2% of the net assets of the Fund, paid quarterly in arrears. The Management Company also receives compensation for providing certain investor communication services, of which $12,500 is included in the accompanying Statements of Operations for each of the three months ended March 31, 2000 and 1999. The Management Company is controlled by a privately-owned corporation. As compensation for services rendered to the Fund, each director who is not an officer of the Fund receives an annual fee of $25,000 paid quarterly in arrears, a fee of $3,000 for each meeting of the Board of Directors attended in person, a fee of $1,500 for participation in each telephonic meeting of the Board of Directors and for each committee meeting attended ($500 for each committee meeting if attended on the same day as a Board Meeting), and reimbursement of all out-of-pocket expenses relating to attendance at such meetings. In addition, each director who is not an officer of the Fund is granted incentive stock options to purchase shares of the Fund's stock from time to time. (See Note 10). Certain officers and directors of the Fund serve as directors of Portfolio Companies, and may receive and retain fees, including non-employee director stock options, from such Portfolio Companies in consideration for such service. 12 (3) SIGNIFICANT ACCOUNTING POLICIES Valuation of Investments - Portfolio investments are carried at fair value with the net change in unrealized appreciation or depreciation included in the determination of net assets. Investments in companies whose securities are publicly traded are valued at their quoted market price, less a discount to reflect the estimated effects of restrictions on the sale of such securities ("Valuation Discount"), if applicable. Cost is used to approximate fair value of other investments until significant developments affecting an investment provide a basis for use of an appraisal valuation. Thereafter, portfolio investments are carried at appraised values as determined quarterly by the Management Company, subject to the approval of the Board of Directors. The fair market values of debt securities, which are generally held to maturity, are determined on the basis of the terms of the debt securities and the financial conditions of the issuer. Because of the inherent uncertainty of the valuation of portfolio securities which do not have readily ascertainable market values, amounting to $109,930,299 (including $16,702,089 in publicly-traded securities, net of a $2,316,509 Valuation Discount) and $111,571,919 (including $17,228,705 in publicly-traded securities, net of a $2,554,017 Valuation Discount) at March 31, 2000 and December 31, 1999, respectively, the Fund's estimate of fair value may significantly differ from the fair value that would have been used had a ready market existed for the securities. Appraised values do not reflect brokers' fees or other normal selling costs or management incentive fees which might become payable on disposition of such investments. On a daily basis, the Fund adjusts its net asset value for the changes in the value of its publicly held securities and material changes in the value of its private securities and reports those amounts to Lipper Analytical Services, Inc. Weekly and daily net asset values appear in various publications, including BARRON'S and THE WALL STREET JOURNAL and the Fund's website, www.equuscap.com. Investment Transactions - Investment transactions are recorded on the accrual method. Realized gains and losses on investments sold are computed on a specific identification basis. Cash Flows - For purposes of the Statements of Cash Flows, the Fund considers all highly liquid temporary cash investments purchased with an original maturity of three months or less to be cash equivalents. Income Taxes - No provision for federal income taxes has been made in the accompanying financial statements as the Fund has qualified for pass-through treatment as a "regulated investment company" under Subchapter M of the Internal Revenue Code of 1986. As such, all net income is allocable to the stockholders for inclusion in their respective tax returns. Net capital losses are not allocable to the shareholders but can be carried over to offset future earnings of the Fund. (4) BOOK TO TAX RECONCILIATION The Fund accounts for dividends in accordance with Statement of Position 93-2 which relates to the amounts distributed by the Fund as net investment income or net capital gains, which are often not equal to the corresponding income or gains shown in the Fund's financial statements. The Internal Revenue Service approved the Fund's request, effective October 31, 1998, to change its year-end for determining capital gains for federal income tax purposes from December 31 to October 31, which allows current year dividends to be paid prior to the end of the calendar year. The Fund had undistributed capital gains (losses) of $9,946,780 and $(6,558,635) for the period from November 1, 1999 to December 31, 1999 and November 1, 1998 to December 31, 1998, respectively. The Fund realized net capital gains of $738,049 and $2,932,804 for the three months ended March 31, 2000 and 1999, respectively. Therefore, for tax purposes, the Fund had net capital gains (losses) of $10,684,829 and $(3,625,831) for the five months ended March 31, 2000 and 1999 of the 2000 and 1999 tax year, respectively. The Fund had net 13 investment income (loss) for tax purposes of $815,247 and $(240,885) for the three months ended March 31, 2000 and 1999, respectively. The following is a reconciliation of the difference in the Fund's net realized gain or loss on the sale of portfolio securities for book and tax purposes. 2000 1999 ----------- ----------- Net realized gain on the sales of portfolio securities, book ............... $ 738,049 $ 2,932,804 Undistributed 1999 net capital gains .......... 9,946,780 -- Undistributed 1998 net capital losses ......... -- (6,558,635) ----------- ----------- Net realized gain (loss) on the sales of portfolio securities, tax ................ $10,684,829 $(3,625,831) =========== =========== (5) DIVIDENDS The Fund declared no dividends during the three months ended March 31, 2000 and 1999, respectively. The Fund has adopted a policy to make dividend distributions of at least $0.50 per share on an annual basis. In the event that taxable income, including realized capital gains, exceeds $0.50 per share in any year, additional dividends may be declared to distribute such excess. (6) TEMPORARY CASH INVESTMENTS Temporary cash investments, which represent the short-term utilization of cash prior to investment in securities of portfolio companies, distributions to the shareholders or payment of expenses, consist of $45,359,640 in money market accounts with Bank of America, N.A. earning interest at a rate of 5.02% per annum at March 31, 2000. (7) ACCOUNTS RECEIVABLE At December 31, 1999, the accounts receivable balance was $1,050,606, and primarily consisted of $991,161 in principal due on the notes receivable from officers that were issued to the Fund upon exercise of their stock options. The $991,161 was received in January 2000. In addition, $38,818 was included in receivables due from two portfolio companies as reimbursement for expenses related to such investments. One portfolio company reimbursed $24,483 of such receivables to the Fund in January 2000. (8) PORTFOLIO SECURITIES During the three months ended March 31, 2000, the Fund invested $300,000 in one new company and made follow-on investments of $2,051,410 in seven companies, including $437,099 in accrued interest and dividends received in the form of additional portfolio securities and accretion of original issue discount on a promissory note. In addition, the Fund realized a net capital gain of $738,049 during the three months ended March 31, 2000. During the three months ended March 31, 1999, the Fund invested $2,000,499 in two new companies and made follow-on investments of $4,223,959 in eight portfolio companies, including $519,880 in accrued interest and dividends received in the form of additional portfolio securities and 14 accretion of original issue discount on a promissory note. In addition, the Fund realized a net capital gain of $2,932,804 during the three months ended March 31, 1999. (9) NOTES PAYABLE TO BANK The Fund has a $100,000,000 line of credit promissory note with Bank of America N.A., with interest payable at 1/2% over the rate earned in its money market account. The Fund had $45,000,000 and $50,000,000 outstanding on such notes at March 31, 2000 and December 31, 1999, respectively, that was secured by $45,000,000 and $50,000,000 of the Fund's temporary cash investments. The line of credit promissory note expires June 1, 2000. The Fund has a $40,000,000 revolving line of credit with Bank of America, N.A. that expires on June 1, 2000. The Fund had $15,100,000 and $22,400,000 outstanding under such line of credit at March 31, 2000 and December 31, 1999, respectively, which is secured by the Fund's investments in portfolio securities. The interest rate ranges from prime -1/2% to prime +1/4% or LIBOR + 1.65%. The Fund also pays interest at the rate of 1/4% per annum on the unused portion of the line of credit. The average daily balances outstanding on the Fund's notes payable during the three months ended March 31, 2000 and 1999, were $19,051,099 and $40,179,444, respectively. (10) STOCK OPTION PLAN Shareholders have approved the Equus II Incorporated 1997 Stock Incentive Plan ("Stock Incentive Plan"), which authorizes the Fund to issue options to the directors and officers of the Fund in an aggregate amount of up to 20% of the outstanding shares of common stock of the Fund. Implementation of this plan was subject to the receipt of an exemptive order from the Securities and Exchange Commission ("SEC"), which was received on May 8, 1997. The Stock Incentive Plan also provides that each director who is not an officer of the Fund is, on the first business day following each annual meeting, granted an incentive stock option to purchase 2,000 shares of the Fund's common stock. Under the Stock Incentive Plan, options to purchase 294,773 and 939,131 shares of the Fund's common stock with a weighted average exercise price of $19.07 and $17.66 per share were outstanding at March 31, 2000 and 1999, respectively. Outstanding options at March 31, 2000 have exercise prices ranging from $15.56 to $27.44 and expire in May 2007 through May 2009. No options were exercised during the three months ended March 31, 2000 and 1999. On September 30, 1999, options to purchase 654,358 shares of common stock of the Fund were exercised by the officers of the Fund for $17 per share. The exercise price of $11,124,086 was paid in the form of promissory notes from the officers to the Fund. The notes bear interest at 5.42% per annum, have limited recourse and are due on or before September 30, 2008. The notes are secured by the 654,358 shares, including any proceeds or dividends paid thereon. During 1999, a dividend of $4.25 per share was paid by the Fund. As a result of this dividend, 135,608 additional shares were issued to the officers and pledged to the Fund. In addition, principal payments of $991,161, representing 58,304 shares, were made on the notes. As a result of the additional shares issued and payments made, the notes are secured by 789,966 shares of common stock and the outstanding note balance is $10,132,925 at March 31, 2000. The notes receivable, as well as 731,662 of such shares of pledged common stock, are not included in the Fund's net asset value per share. The shares of stock financed by the notes from the officers will be included in the net asset value per share as the shares are paid for or released from 15 collateral. Shares may be released as payments on the notes are made or as the value of the collateral increases. Generally accepted accounting principles require that the options issued to the officers be accounted for using variable plan accounting due to the limited recourse provision of such notes. Additionally, the dividends paid on the non-recourse portion of the notes are required to be recorded as compensation expense in the statements of operations, and interest recorded on the non-recourse portion of the notes is required to be recorded as an increase to additional paid-in capital. Accordingly, for the three months ended March 31, 2000, interest of $111,972 was credited to additional paid-in capital. Additionally, the limited recourse notes receivable from the officers are required to be recorded as a reduction of net assets. If the notes and the shares were included in the Fund's balance sheet, the net asset value would have been $16.71 per share at March 31, 2000. As of March 31, 2000 and 1999, all outstanding options were "out of the money" and would not have had a dilutive effect on net assets per share if exercised, assuming the Fund would use the proceeds from the exercise of such options to purchase shares at the market price pursuant to the treasury stock method. (11) COMMITMENTS AND CONTINGENCIES The Fund has made a commitment to invest, under certain circumstances, up to an additional $236,000 in The Drilltec Corporation, $250,000 in Equicom, Inc. and $2,700,000 in Sternhill Partners I, L.P. In addition, the Fund has committed to invest up to an additional $9,350,000 in three new portfolio companies, including $3,000,000 in Vanguard VII, L.P. The Fund and certain of the portfolio companies are involved in asserted claims and have the possibility for unasserted claims which may ultimately affect the fair value of the Fund's portfolio investments. In the opinion of Management, the financial position or operating results of the Fund will not be materially affected by these claims. On October 1, 1999, the Fund announced it would purchase up to 300,000 shares of common stock in open market transactions over the next six months, subject to market conditions and limitations. As of March 31, 2000, the Fund had repurchased 285,604 shares for $3,034,893, $126,421 of which is included in accounts payable at March 31, 2000. The stock was repurchased at an average discount of 34% from its net asset value. (12) SUBSEQUENT EVENTS Subsequent to March 31, 2000, the Fund repaid a net $43,400,000 of notes payable to the bank. Subsequent to March 31,2000, the Fund completed the announced plan pursuant to which it repurchased a total of 300,000 shares of its common stock by repurchasing an additional 14,396 shares of common stock for $152,582, at an average discount of 37.9% from its net asset value. In addition, the fund announced it would purchase up to an additional 400,000 shares of its common stock in open market transactions over the next six months, subject to market conditions and limitations. On May 4, 2000, the Fund invested $1,335,001 in The Bradshaw Group, a company that sells and services high speed laser printers, in exchange for 1,335,000 shares of 8% redeemable preferred stock and warrants to buy 2,229,450 shares of common stock at $0.01 per share through May 4, 2008. 16 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. LIQUIDITY AND CAPITAL RESOURCES At March 31, 2000, the Fund had $113,796,152 of its assets invested in portfolio securities of 27 companies, and has committed to invest up to an additional $3,186,000 in three of such companies, and $9,350,000 in three new companies under certain conditions. Current temporary cash investments, anticipated future investment income, proceeds from borrowings, and proceeds from the sale of existing portfolio securities are believed to be sufficient to finance these commitments. At March 31, 2000, the Fund had $15,100,000 outstanding on a $40,000,000 revolving line of credit loan from a bank. Net cash used by operating activities was $166,541 and $998,491 for the three months ended March 31, 2000 and 1999, respectively. At March 31, 2000, the Fund had $45,359,640 of its total assets of $162,360,923 invested in temporary cash investments consisting of money market securities. This amount includes proceeds of $45,000,000 from a $100,000,000 note payable to a bank that is utilized to enable the Fund to achieve adequate diversification to maintain its pass-through tax status as a regulated investment company. Such amount was repaid to the bank on April 3, 2000. The Fund has the ability to borrow funds and issue forms of senior securities representing indebtedness or stock, such as preferred stock, subject to certain restrictions. Net investment income and net realized gains from the sales of portfolio investments are intended to be distributed at least annually, to the extent such amounts are not reserved for payment of contingencies or to make follow-on or new investments. Management believes that the availability under its line of credit, as well as the ability to sell its investments in publicly traded securities, are adequate to provide payment for any expenses and contingencies of the Fund. The Fund reserves the right to retain net long-term capital gains in excess of net short-term capital losses for reinvestment or to pay contingencies and expenses. Such retained amounts, if any, will be taxable to the Fund as long-term capital gains and stockholders will be able to claim their proportionate share of the federal income taxes paid by the Fund on such gains as a credit against their own federal income tax liabilities. Stockholders will also be entitled to increase the adjusted tax basis of their Fund shares by the difference between their undistributed capital gains and their tax credit. The Fund may repurchase its shares, subject to the restrictions of the Investment Company Act. On September 28, 1999, the Board of Directors approved a program to purchase up to 300,000 shares of the Fund's common stock, pursuant to which the Fund repurchased 285,604 shares for $3,034,893 through March 31, 2000. Such stock was repurchased at an average discount of 34% from its net asset value. RESULTS OF OPERATIONS INVESTMENT INCOME AND EXPENSE Net investment income (loss) after all expenses amounted to $703,275 and $(240,885) for the three months ended March 31, 2000 and 1999, respectively. The increase in net investment income in 2000 is due to a decrease in interest expense and an increase in income from portfolio securities. Interest expense decreased to $389,681 in 2000 from $718,170 in 1999 due to a decrease in the average daily 17 balances outstanding on the lines of credit to $19,051,099 during the three months ended March 31, 2000 from $40,179,444 during the comparable period in 1999. Income from portfolio securities was $1,695,481 for the three months ended March 31, 2000 and $1,152,787 for the comparable period in 1999. The increase is attributable to the interest received upon the repayment of the notes from Video Rental of Pennsylvania, Inc. during the first quarter of 2000. The Management Company receives management fee compensation at an annual rate of 2% of the net assets of the Fund paid quarterly in arrears. Such fees amounted to $505,962 and $536,345 during the three months ended March 31, 2000 and 1999, respectively. The decrease in management fees during the three months ended March 31, 2000 was due to the decrease in net assets. Shareholders have approved the Equus II Incorporated 1997 Stock Incentive Plan ("Stock Incentive Plan") which authorizes the Fund to issue options to the directors and officers of the Fund in an aggregate amount of up to 20% of the outstanding shares of common stock of the Fund. Implementation of this plan was subject to the receipt of an exemptive order from the SEC, which was received on May 8, 1997. The Stock Incentive Plan also provides that each director who is not an officer of the Fund is, on the first business day following each annual meeting, granted an incentive stock option to purchase 2,000 shares of the Fund's common stock. Under the Stock Incentive Plan, options to purchase 294,773 and 939,131 shares of the Fund's common stock with a weighted average exercise price of $19.07 and $17.66 per share were outstanding at March 31, 2000 and 1999, respectively. Outstanding options at March 31, 2000 have exercise prices ranging from $15.56 to $27.44 and expire in May 2007 through May 2009. On September 30, 1999, options to purchase 654,358 shares of common stock of the Fund were exercised by the officers of the Fund for $17 per share. The exercise price of $11,124,086 was paid in the form of promissory notes from the officers to the Fund. The notes bear interest at 5.42% per annum, have limited recourse and are due on or before September 30, 2008. The notes are secured by the 654,358 shares, including any proceeds or dividends paid thereon. During 1999, a dividend of $4.25 per share was paid. As a result of the dividend, 135,608 additional shares were issued to the officers and pledged to the Fund. In addition, principal payments of $991,161, representing 58,304 shares, were made on the notes. As a result of the additional shares issued and payments made, the notes are secured by 789,966 shares of common stock and the outstanding note balance is $10,132,925 at March 31, 2000. The notes receivable, as well as 731,662 of such shares of common stock, are not included in the Fund's net asset value per share. The shares of stock financed by the notes from the officers will be included in the net asset value per share as the shares are paid for or released from collateral. Shares may be released as payments on the notes are made or as the value of the collateral increases. Generally accepted accounting principles require that the options issued to the officers be accounted for using variable plan accounting due to the limited recourse provision of such notes. Additionally, the dividends paid on the non-recourse portion of the notes are required to be recorded as compensation expense in the statements of operations, and interest recorded on the non-recourse portion of the notes is required to be recorded as an increase to additional paid-in capital. Accordingly, for the three months ended March 31, 2000, interest of $111,972 was credited to additional paid-in capital. Additionally, the limited recourse notes receivable from the officers are required to be recorded as a reduction of net assets. If the notes and the shares were included in the Fund's balance sheet, the net asset value would have been $16.71 per share at March 31, 2000. As of March 31, 2000 and 1999, all outstanding options were "out of the money" and would not have had a dilutive effect on net assets per share if exercised, assuming the Fund would use the proceeds 18 from the exercise of such options to repurchase shares at the market price pursuant to the treasury stock method. REALIZED GAINS AND LOSSES ON SALES OF PORTFOLIO SECURITIES During the three months ended March 31, 2000, the Fund realized net capital gains of $738,049 as a result of additional compensation related to the previous sale of three Portfolio Companies. The Fund realized a capital gain of $680,636 as a result of additional compensation from the escrow account related to the 1998 sale of WMW Industries. The Fund realized a capital gain of $65,728 as a result of additional compensation from the escrow account related to the 1999 sale of HTD Corporation. In addition, the Fund wrote off a receivable from Restaurant Development Group realizing a capital loss of $8,315. In addition, during the quarter, the Fund received proceeds from Video Rental of Pennsylvania, Inc. in the amount of $3,722,349 for the outstanding notes payable and $250,000 for the common and preferred stock and did not realize a capital gain. During the three months ended March 31, 1999, the Fund realized net capital gains of $2,932,804 from the sale of securities of two Portfolio Companies. The Fund sold its investment of 54,334 shares of common stock in United Rentals, Inc. for $1,738,036, realizing a capital gain of $1,737,639 and 80,300 common shares of United States Filter Corporation for $2,147,060, realizing a capital gain of $1,195,165. DEPRECIATION OF PORTFOLIO SECURITIES Net unrealized depreciation on investments decreased $43,886 during the three months ended March 31, 2000, from $1,100,588 to $1,056,702. Such net decrease resulted from increases in the estimated fair value of securities of seven of the Fund's Portfolio Companies aggregating $6,885,614 and decreases in the estimated fair value of securities of five of the Fund's Portfolio Companies aggregating $6,841,728. Net unrealized appreciation on investments decreased $11,578,016 during the three months ended March 31, 1999, from $44,311,697 to $32,733,681. Such net decrease resulted from decreases in the estimated fair value of securities of seven of the Fund's Portfolio Companies aggregating $14,066,146, an increase in the estimated fair value of securities of four Portfolio Companies of $5,172,514, and the transfer of $2,684,384 in net unrealized appreciation to net realized gains from the sale of investments in two Portfolio Companies. DIVIDENDS The Fund declared no dividends for the three months ended March 31, 2000 and 1999. PORTFOLIO INVESTMENTS During the three months ended March 31, 2000, the Fund invested $300,000 in one new company and made follow-on investments of $2,051,410 in seven portfolio companies, including $437,099 in accrued interest and dividends received in the form of additional portfolio securities and accretion of original issue discount on a promissory note. During the first quarter 2000, the Fund advanced $240,000 to The Drilltec Corporation pursuant to a prime + 9.75% promissory note, $147,746 to Equicom, Inc. pursuant to a 10% promissory note and $500,000 to Hot & Cool Holdings, Inc. pursuant to a 12% promissory note. 19 For the quarter ended March 31, 2000, the Fund received an additional 1,488 and 329 shares of preferred stock of Container Acquisition, Inc and Sovereign Business Forms, Inc. ("Sovereign") in payment of $148,800 and $32,900 in dividends, respectively. In addition, Sovereign elected to convert $225,399 of accrued interest into the balance of the 15% promissory notes due to the Fund. On February 28, 2000, the Fund invested an additional $726,565 in Summit/DPC Partners to allow the partnership to purchase additional shares of Doane Pet Care Enterprises, Inc. common stock. On March 15, 2000, the Fund committed to invest up to $3,000,000 in Sternhill Partners I, L.P., a fund formed to invest in private, early-stage, emerging-growth companies involved in information technology and, on limited occasions, life science technologies. During the first quarter of 2000, the original issue discount accretion on the discounted 12% subordinated promissory note due from Turfgrass America, Inc. ("Turfgrass") amounted to $30,000, bringing the balance of the note to $3,505,000 at March 31, 2000. The original issue discount is being accreted over the life of the note. SUBSEQUENT EVENTS Subsequent to March 31, 2000, the Fund repaid a net $43,400,000 of notes payable to the bank. Subsequent to March 31, 2000, the Fund completed the announced plan pursuant to which it repurchased a total of 300,000 shares of its common stock by repurchasing an additional 14,396 shares of common stock for $152,582 at an average discount of 37.9% from its net asset value. In addition, the Fund announced it would purchase up to an additional 400,000 shares of its common stock in open market transactions over the next six months, subject to market conditions and limitations. On May 4, 2000 the Fund invested $1,335,001 in The Bradshaw Group, a company that sells and services high speed laser printers, in exchange for 1,335,000 shares of 8% redeemable preferred stock and warrants to buy 2,229,450 shares of common stock at $0.01 per share through May 4, 2008. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK The Fund is subject to financial market risks, including changes in interest rates with respect to its investments in debt securities and its outstanding debt payable, as well as changes in marketable equity security prices. The Fund does not use derivative financial instruments to mitigate any of these risks. The return on the Fund's investments is generally not affected by foreign currency fluctuations. The Fund's investment in portfolio securities consists of some fixed rate debt securities. Since the debt securities are generally priced at a fixed rate, changes in interest rates do not directly impact interest income. In addition, changes in market interest rates are not typically a significant factor in the Fund's determination of fair value of these debt securities. The Fund's debt securities are generally held to maturity and their fair values are determined on the basis of the terms of the debt security and the financial condition of the issuer. The Fund's liabilities consist of debt payable to a financial institution. The revolving credit facilities are priced at floating rates of interest, with a basis of LIBOR or prime rate at the Fund's option. As a result of the floating rate, a change in interest rates could result in either an increase or decrease in the Fund's interest expense. A portion of the Fund's investment portfolio consists of debt and equity investments in private companies. The Fund would anticipate no impact on these investments from modest changes in public market equity prices. However, should significant changes in market equity prices occur, there could be a 20 longer-term effect on valuations of private companies, which could affect the carrying value and the amount and timing of gains realized on these investments. A portion of the Fund's investment portfolio also consists of common stocks and warrants to purchase common stock in publicly traded companies. These investments are directly exposed to equity price risk, in that a hypothetical ten percent change in these equity prices would result in a similar percentage change in the fair value of these securities. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) EXHIBITS 10. Material Contracts (b) REPORTS ON FORM 8-K No reports on Form 8-K were filed by the Fund during the period for which this report is filed. SIGNATURE Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed by the undersigned, thereunto duly authorized. Date: May 15, 2000 EQUUS II INCORPORATED /s/ NOLAN LEHMANN Nolan Lehmann President and Principal Financial and Accounting Officer 21 EX-27.1 2
6 3-MOS DEC-31-2000 MAR-31-2000 160,212,494 159,155,792 3,199,863 5,268 0 162,360,923 0 0 61,168,516 61,168,516 9,656,540 91,535,867 5,930,938 6,107,669 0 0 10,706,580 0 (1,056,702) 101,192,407 319,578 1,426,654 0 1,042,957 703,275 738,049 43,866 1,485,210 0 0 0 0 0 0 0 1,485,210 0 0 0 0 505,962 389,681 1,042,957 101,305,614 16.61 0.12 0.12 0 0 0 17.06 1.03
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