FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
| [X] |
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the Quarterly Period Ended June 30, 2002
OR
| [ ] |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from _______ to _______
Commission file number 0-21682
SPARTA, Inc.
| Delaware | 63-0775889 | |
|
|
||
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer) |
23041 Avenida de la Carlota, Suite 325, Laguna Hills, CA 92653-1595
(949) 768-8161
Not Applicable
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 or 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.
SPARTA, Inc.
QUARTERLY REPORT FOR THE PERIOD ENDED JUNE 30, 2002
INDEX
| PART I | Financial Information | |
| Item 1 | Condensed Financial Statements | |
| Item 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |
| Item 3 | Qualitative and Quantitative Disclosures About Market Risk | |
| PART II | Other Information | |
| Item 1 | Legal Proceedings | |
| Item 2 | Changes in Securities | |
| Item 3 | Defaults Upon Senior Securities | |
| Item 4 | Submission of Matters to a Vote of Security Holders | |
| Item 5 | Other Materially Important Events | |
| Item 6 | Exhibits and Reports on Form 8-K | |
| Signature |
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PART I
Financial Information
Item 1. Condensed Financial Statements
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SPARTA, Inc.
CONSOLIDATED BALANCE SHEET
| June 30, | December 31, | |||||||||
| 2002 | 2001 | |||||||||
| (Unaudited) | ||||||||||
ASSETS |
||||||||||
Current Assets |
||||||||||
Cash and cash equivalents |
$ | 14,788,000 | $ | 10,303,000 | ||||||
Short-term investments |
3,000,000 | $ | 8,727,000 | |||||||
Accounts receivable, net |
28,649,000 | 27,150,000 | ||||||||
Prepaid expenses |
827,000 | 395,000 | ||||||||
Total current assets |
47,264,000 | 46,575,000 | ||||||||
Equipment and improvements, net |
7,964,000 | 8,606,000 | ||||||||
Other assets |
2,041,000 | 1,971,000 | ||||||||
Total Assets |
$ | 57,269,000 | $ | 57,152,000 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||||
Current Liabilities |
||||||||||
Accrued compensation |
$ | 9,878,000 | $ | 10,596,000 | ||||||
Accounts payable and other accrued expenses |
6,400,000 | 5,977,000 | ||||||||
Current portion of subordinated notes payable |
2,198,000 | 1,609,000 | ||||||||
Income taxes payable |
2,322,000 | 2,049,000 | ||||||||
Deferred income taxes |
1,013,000 | 1,013,000 | ||||||||
Total current liabilities |
21,811,000 | 21,244,000 | ||||||||
Subordinated notes payable |
9,255,000 | 7,365,000 | ||||||||
Deferred income taxes |
812,000 | 812,000 | ||||||||
Redeemable Preferred Stock |
||||||||||
Preferred stock, $.01 par value; 2,000,000 shares authorized;
121,293 and 223,682 shares issued and outstanding |
2,494,000 | 4,053,000 | ||||||||
Stockholders’ equity |
||||||||||
Common stock, $.01 par value, 25,000,000 shares authorized;
5,478,043 and 5,071,564 shares issued and outstanding |
55,000 | 50,000 | ||||||||
Additional paid-in capital |
30,854,000 | 24,655,000 | ||||||||
Retained earnings |
3,046,000 | (1,027,000 | ) | |||||||
Treasury stock |
(11,058,000 | ) | — | |||||||
Total stockholders’ equity |
22,897,000 | 23,678,000 | ||||||||
Total Liabilities and Stockholders’ Equity |
$ | 57,269,000 | $ | 57,152,000 | ||||||
The accompanying notes are an integral part of the financial statements
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SPARTA, Inc.
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
| Three Months ended June 30, | Six Months ended June 30, | ||||||||||||||||
| 2002 | 2001 | 2002 | 2001 | ||||||||||||||
Sales |
$ | 40,746,000 | $ | 33,793,000 | $ | 76,674,000 | $ | 65,187,000 | |||||||||
Costs and expenses: |
|||||||||||||||||
Labor costs and related benefits |
21,945,000 | 17,345,000 | 42,537,000 | 35,220,000 | |||||||||||||
Subcontractor & other costs |
10,894,000 | 8,674,000 | 19,215,000 | 16,234,000 | |||||||||||||
Facility costs |
2,457,000 | 2,232,000 | 5,026,000 | 4,385,000 | |||||||||||||
Travel and other |
1,510,000 | 2,325,000 | 2,567,000 | 2,910,000 | |||||||||||||
Interest expense (income), net |
(15,000 | ) | (52,000 | ) | (39,000 | ) | (106,000 | ) | |||||||||
| 36,791,000 | 30,524,000 | 69,306,000 | 58,643,000 | ||||||||||||||
Income before provision for
taxes on income |
3,955,000 | 3,269,000 | 7,368,000 | 6,544,000 | |||||||||||||
Provision for taxes on income |
1,582,000 | 1,308,000 | 2,947,000 | 2,618,000 | |||||||||||||
Net income |
$ | 2,373,000 | $ | 1,961,000 | $ | 4,421,000 | $ | 3,926,000 | |||||||||
Basic earnings per share |
$ | 0.45 | $ | 0.32 | $ | 0.83 | $ | 0.74 | |||||||||
Diluted earnings per share |
$ | 0.41 | $ | 0.30 | $ | 0.76 | $ | 0.68 | |||||||||
The accompanying notes are an integral part of the financial statements
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SPARTA, Inc.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
| Six Months ended June 30, | ||||||||||||
| 2002 | 2001 | |||||||||||
Cash flows from operating activities: |
||||||||||||
Net income |
$ | 4,421,000 | $ | 3,926,000 | ||||||||
Adjustments to reconcile net income to net
cash provided by operating activities: |
||||||||||||
Depreciation and amortization |
1,080,000 | 1,041,000 | ||||||||||
Loss on sale of equipment |
88,000 | |||||||||||
Stock-based compensation |
2,918,000 | 2,672,000 | ||||||||||
Changes in assets and liabilities: |
||||||||||||
Accounts receivable |
(1,499,000 | ) | 10,813,000 | |||||||||
Prepaid expenses |
(432,000 | ) | (196,000 | ) | ||||||||
Other assets |
(70,000 | ) | (89,000 | ) | ||||||||
Accrued compensation |
(718,000 | ) | (896,000 | ) | ||||||||
Accounts payable and other accrued expenses |
423,000 | (3,484,000 | ) | |||||||||
Income taxes payable |
273,000 | 688,000 | ||||||||||
Tax benefit relating to stock plan |
1,006,000 | 840,000 | ||||||||||
Net cash provided by (used for) operating activities |
7,490,000 | 15,315,000 | ||||||||||
Cash flows from investing activities: |
||||||||||||
Capital expenditures |
(526,000 | ) | (1,020,000 | ) | ||||||||
Net proceeds from sale of short-term investments |
5,727,000 | |||||||||||
Net cash provided by (used for) investing activities |
5,201,000 | (1,020,000 | ) | |||||||||
Cash flows from financing activities: |
||||||||||||
Proceeds from issuance of stock |
2,279,000 | 1,779,000 | ||||||||||
Redemption of preferred stock |
(1,906,000 | ) | (456,000 | ) | ||||||||
Cash purchases of treasury stock |
(7,608,000 | ) | (5,249,000 | ) | ||||||||
Principal payments on subordinated notes payable |
(971,000 | ) | (586,000 | ) | ||||||||
Net cash provided by (used for) financing activities |
(8,206,000 | ) | (4,512,000 | ) | ||||||||
Net increase (decrease) in cash |
4,485,000 | 9,783,000 | ||||||||||
Cash and cash equivalents at beginning of period |
10,303,000 | 7,082,000 | ||||||||||
Cash and cash equivalents at end of period |
$ | 14,788,000 | $ | 16,865,000 | ||||||||
Supplemental disclosures of cash flow information: |
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Cash paid during the period for: |
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Interest |
$ | 117,000 | $ | 156,000 | ||||||||
Income taxes |
$ | 1,703,000 | $ | 1,113,000 | ||||||||
The accompanying notes are an integral part of the financial statements
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SPARTA, INC.
Notes to Consolidated Financial Statements
(Unaudited)
Note A — Basis of Presentation
The accompanying financial information has been prepared in accordance with the instructions to Form 10-Q and therefore does not necessarily include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles.
The Company’s fiscal year is the 52 or 53 week period ending on the Sunday closest to December 31. The Company’s last fiscal year ended on December 30, 2001, its second quarter ended June 30, 2002, and its corresponding second quarter last year ended on July 1, 2001. To aid the reader of the financial statements, the year-end has been presented as December 31, 2001 and the quarters and six-month period ends have been presented as June 30, 2002 and June 30, 2001.
In the opinion of management, the unaudited financial information for the six-month periods ended June 30, 2002 and June 30, 2001 reflects all adjustments (which include only normal, recurring adjustments) necessary for a fair presentation thereof.
Note B — Income Taxes
Income taxes for interim periods are computed using the estimated annual effective rate method.
Note C — Computation of Per Share Earnings
| Three months ended June 30, | Six months ended June 30 | |||||||||||||||||
| 2002 | 2001 | 2002 | 2001 | |||||||||||||||
Basic EPS |
||||||||||||||||||
Net income |
$ | 2,373,000 | $ | 1,961,000 | $ | 4,421,000 | $ | 3,926,000 | ||||||||||
Accretion adjustment |
(165,000 | ) | (265,000 | ) | (347,000 | ) | (141,000 | ) | ||||||||||
| $ | 2,208,000 | $ | 1,696,000 | $ | 4,074,000 | $ | 3,785,000 | |||||||||||
Shares outstanding |
4,879,544 | 5,251,505 | 4,909,702 | 5,102,091 | ||||||||||||||
Per share amounts |
$ | 0.45 | $ | 0.32 | $ | 0.83 | $ | 0.74 | ||||||||||
Dilutive Effect |
||||||||||||||||||
Net income |
$ | 2,373,000 | $ | 1,961,000 | $ | 4,421,000 | $ | 3,926,000 | ||||||||||
Accretion adjustment |
(165,000 | ) | (265,000 | ) | (347,000 | ) | (141,000 | ) | ||||||||||
| $ | 2,208,000 | $ | 1,696,000 | $ | 4,074,000 | $ | 3,785,000 | |||||||||||
Shares outstanding |
4,879,544 | 5,251,505 | 4,909,702 | 5,102,091 | ||||||||||||||
Stock options |
405,682 | 346,840 | 369,603 | 347,881 | ||||||||||||||
Deferred stock |
90,327 | 116,442 | 90,327 | 116,442 | ||||||||||||||
| 5,375,553 | 5,714,787 | 5,369,632 | 5,566,414 | |||||||||||||||
Per share amounts |
$ | 0.41 | $ | 0.30 | $ | 0.76 | $ | 0.68 | ||||||||||
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following table sets forth, for the periods indicated, selected financial results:
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||
| 2002 | 2001 | 2002 | 2001 | ||||||||||||||
Sales |
$ | 40,746,000 | $ | 33,793,000 | $ | 76,674,000 | $ | 65,187,000 | |||||||||
Sales by business area, as a
percentage of total sales |
|||||||||||||||||
Ballistic Missile Defense (BMD) |
43 | % | 37 | % | 42 | % | 37 | % | |||||||||
Non BMD Dept of Defense (DoD) |
48 | % | 50 | % | 48 | % | 49 | % | |||||||||
Non-DoD |
9 | % | 13 | % | 10 | % | 14 | % | |||||||||
Gross profit (1) |
$ | 3,964,000 | $ | 3,591,000 | $ | 7,477,000 | $ | 6,872,000 | |||||||||
Gross profit as a % of costs |
10.8 | % | 11.9 | % | 10.8 | % | 11.8 | % | |||||||||
Income before income taxes |
$ | 3,955,000 | $ | 3,269,000 | $ | 7,368,000 | $ | 6,544,000 | |||||||||
Net income |
$ | 2,373,000 | $ | 1,961,000 | $ | 4,421,000 | $ | 3,926,000 | |||||||||
| Balance at | ||||||||||||
| June 30 | December 31, | June 30 | ||||||||||
| 2002 | 2001 | 2001 | ||||||||||
Funded 12 month backlog |
$ | 70,400,000 | $ | 31,700,000 | $ | 58,200,000 | ||||||
Unfunded 12 month backlog |
76,200,000 | 111,600,000 | 124,600,000 | |||||||||
Total 12 month contract backlog |
$ | 146,600,000 | $ | 143,300,000 | $ | 182,800,000 | ||||||
Stockholder’s equity |
$ | 22,897,000 | $ | 23,678,000 | $ | 20,140,000 | ||||||
Equity per share (2) |
4.18 | 4.66 | 3.33 | |||||||||
Stock repurchase notes |
$ | 11,453,000 | $ | 8,974,000 | $ | 9,811,000 | ||||||
Line of credit |
— | — | — | |||||||||
Number in days sales in receivables |
63 | 66 | 62 | |||||||||
Current ratio |
2.2 | 2.2 | 2.5 | |||||||||
| (1) | The Company defines gross profit as sales less all costs that are allowable for and allocable to contracts under government procurement regulations. As a result, gross profit differs from income before income taxes because gross profit excludes certain unallowable expenses, such as interest income and interest expense. Management considers gross profit, and gross profit as a percentage of costs, to be key measures of the Company’s contract performance. | ||
| (2) | Equity per share is based on outstanding shares of common stock. |
New Contracts and Annualized Backlog
In the second quarter, the Company had six significant competitive contract and task-order wins and four significant competitive contract and task-order losses.
The Integrated Data Systems Operation (IDSO), as a subcontractor to the Advanced Logistics Solutions Joint Venture, won a $2.7 million, three-year task order with the Hawk Air Defense Training Program. This effort is under the Army Aviation and Missile Command (AMCOM) 2000 Omnibus Logistics Support program. The Advanced Systems and Technology Operation (ASTO) won a Defense Threat Readiness Agency (DTRA) task order for Analytical Support, a task valued at $1.9 million over one year. The Space and Missile Defense Operation (SMDO) won a task order for Phased Array Antenna Technology under our Engineering Analysis Design and Development (EADD) II program. Ball Aerospace is a major subcontractor on this task valued at $2.8 million over two years. The Distributed Simulation and Software Operation (DSSO), as a subcontractor to Lockheed-Martin, won the National Training Center — Objective Instrumentation System
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program out of the Simulation Training, Readiness and Instrumentation Command (STRICOM). This award is expected to generate $1 million in sales per year for three years. The Information System Security Operation (ISSO) won two subcontract awards from the National Security Agency (NSA). The first was for the Public Key Infrastructure program with a value of $8.5 million over five years. ISSO is a subcontractor to Booz Allen Hamilton. The second one was for the Key Management Prototyping Support program with a value of $3.5 million over five years. ISSO is a subcontractor to Getronics.
ISSO, as a subcontractor to Booz Allen Hamilton, lost the X Omnibus contract with the NSA. The program was valued at $10 million over five years. ISSO also lost an Information Assurance program with the Federal Aviation Agency (FAA). The program was valued at $10 million over five years. The Defense Program Operation (DPO) lost a GSA task order for Ballistic Missile Cruise Command Technical Support for the Air Force. This effort was valued at $4.2 million over a four-year period. ASTO lost a task order for External Affairs under its Blanket Purchase Agreement (BPA) with the Missile Defense Agency (MDA). This effort was valued at $3.7 million over five years.
Additionally, during the quarter ended June 30, 2002, the Electro-Optical System Division was notified by its customer that they would not be able to continue funding the development of our nanAlign™ product this year. The lagging world economy and pressing near-term issues in the semiconductor industry resulted in the break in funding. However, based on discussion with the customer, management believes that the customer remains interested in further development of the nanAlign™ product for their next generation of steppers, and that if business conditions in the semiconductor industry improve next year, the Company will likely obtain additional funding from the customer.
During the second quarter, the Company received contract awards totaling $58.3 million. A portion of this funding had been delayed at the end of 2001 due to the delay in Congressional approval of defense appropriations legislation. As a result of this funding and the contract wins and losses discussed above, the Company’s funded contract backlog increased from $55.6 million at the end of the first quarter to $70.4 million during the second quarter of 2002. Firm/assured contract backlog decreased from $151.3 at the end of the first quarter to $146.6 million during the second quarter of 2002.
Results of Operations
The Company’s contract revenues for the second quarter of 2002 increased 21% from the corresponding period in 2001 due to increased project billings, including the effect of new work as described above. BMD sales increased 42% over the corresponding period in 2001, as the Company won several new contracts (or extensions of previous contracts) during the latter part of 2001, as well as in the first quarter of 2002. Non-BMD DoD sales increased 16% over the corresponding period in 2001, as the Company has continued to experience growth in its business for various intelligence organizations. Non-DoD sales decreased 15% over the corresponding period in 2001 due to the completion of a commercial development contract early in the first quarter of 2002.
The Company defines gross profit as sales less all costs that are allowable for and allocable to contracts under government procurement regulations and cost principles. As a result, gross profit differs from income before income taxes because gross profit excludes unallowable expenses, such as interest income and expense. Management considers gross profit, and the gross profit rate (gross profit as a percentage of costs), to be key measures of the Company’s contract performance. Gross profit for the three-month period ended June 30, 2002 increased 10% compared to the corresponding period of 2001, due primarily to the increase in sales over the same period. The gross profit rate decreased to 10.8% for the second quarter of 2002, from 11.9% for the corresponding period in 2001. The decrease in the gross profit rate is primarily attributable to sales mix, as the gross profit rate on BMD programs, which comprised a higher percentage of revenues during the second quarter of 2002, is somewhat lower than on other programs.
Income before income taxes for the three-month period ended June 30, 2002 increased 21% compared to the corresponding period of 2001. This increase is primarily due to the increase in contract gross profits discussed in the preceding paragraph. In addition, the increase is attributable to the Company recording certain unallowable expenses (primarily relating to a contract dispute) in the corresponding period in 2001.
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Liquidity and Capital Resources
The Company’s principal sources of capital resources for funding its operations are cash and short-term investments on hand, funds generated by ongoing business activities, and proceeds from exercise of stock options and the issuance of common stock. These sources are augmented, as necessary, by borrowings under the Company’s bank line of credit. The principal uses of capital resources are for the repurchase of preferred and common stock, repayments of amounts borrowed under the bank line of credit, principal payments on subordinated promissory notes, and capital expenditures.
There were no borrowings against the Company’s $6 million line of credit during the second quarter of 2002 or the corresponding period in 2001. Sustaining the low reliance on borrowings is largely due to the Company’s cash and short-term investment position, emphasis on rapid billing and collection of receivables, a concerted effort to control capital expenditures and expenditures for independent research and development, and a planned reduction of investment in product initiatives. Days sales outstanding (DSO) decreased to 63 days at June 30, 2002 from 73 days at March 31, 2002. This decrease was primarily attributable to the receipt of payments on contracts previously subject to the delayed Congressional approval of defense appropriations legislation. The Company continues to actively monitor receivables with emphasis placed on collection activities.
Significant uses of cash during the second quarter of 2002 include the repurchase of $3.1 million of common stock in accordance with the Company’s voluntary stock repurchase policy and the repurchase of $900,000 of redeemable preferred stock.
During the second quarter of 2002, the Company and its bank entered into an Amended and Restated Loan Agreement (the Loan Agreement). The Loan Agreement extends the Company’s $6 million line of credit facility through July 1, 2004. Borrowings under the Loan Agreement are at the bank’s reference rate (or LIBOR plus 2%, at the Company’s option), and are collateralized by substantially all of the Company’s assets. In addition, the Loan Agreement restricts the ability of the Company to pay dividends, and requires the Company to maintain certain financial ratios. The Company was in compliance with such requirements at June 30, 2002. The Company anticipates that its existing capital resources and access to its line of credit will be sufficient to fund planned operations for the foreseeable future.
Stock Purchase Agreement
In November 1994, the Company entered into a Stock Purchase Agreement with Science Applications International Corporation (SAIC), pursuant to which SAIC purchased a total of 569,039 shares of redeemable preferred stock at a cost of $2.4 million. Beginning in May 1999, by agreement with SAIC, the Company began repurchasing shares of this preferred stock. During the second quarter of 2002, the Company repurchased 47,201 shares at a cost of $900,000. As of June 30, 2002, SAIC held 121,293 shares of redeemable preferred stock, with an aggregate accreted value of $2.5 million. It is the Company’s intent to continue to repurchase SAIC stock.
Effects of Federal Funding for Defense Programs
The Company continues to derive over 90% of its revenues from contracts with U.S. Government agencies. The Company’s government contracts may be terminated, in whole or in part, at the convenience of the customer (as well as in the event of default). In the event of a termination for convenience, the customer is generally obligated to pay the costs incurred by the Company under the contract plus a fee based upon work completed. There were no contracts terminated in the first quarter of 2002. The Company does not anticipate any termination of programs and contracts in 2002. However, no assurances can be given that such events will not occur.
In addition to the right of the U.S. government to terminate contracts for convenience, U.S. government contracts are conditioned upon the continuing availability of Congressional appropriations. These appropriations are therefore subject to changes as a result of increases or decreases in the overall budget. New presidential administrations, change in the composition of Congress, and disagreement or significant delay between Congress and the Administration in reaching a defense budget accord can all significantly affect the timing of funding on the Company’s contract backlog. Delays in contract funding resulting from these factors may have a significant adverse effect on the Company’s revenue recognition, liquidity, and DSO.
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Forward-Looking Statements
All statements in this report that do not directly and exclusively relate to historical facts constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements represent the Company’s intentions, plans, expectations and beliefs, and are subject to risks, uncertainties and other factors, many of which are outside the Company’s control. These factors could cause our actual results, performance, achievements or industry results to differ materially from the results, performance or achievements expressed or implied by such forward-looking statements. These factors are described in more detail in the Company’s Annual Report on Form 10-K for the fiscal year ended December 30, 2001, and such other filings that the Company makes with the SEC from time to time. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Refer to item 7A in the Company’s Annual Report on Form 10-K for the year ended December 31, 2001.
Part II Other Information
Item 1 Legal Proceedings
The Company has no investigations, claims, or lawsuits arising out of its business, nor any known to be pending.
Item 2 Changes in Securities
Not Applicable
Item 3 Defaults Upon Senior Securities
Not Applicable
Item 4 Submission of Matters to a Vote of Security Holders
The Company’s Annual Meeting was held on May 31, 2002, at which time proxies and shareholders present voted on the election of Directors and on the retention of PricewaterhouseCoopers LLP as the Company’s independent accountants for the year ending December 31, 2002.
Item 5 Other Materially Important Events
Not Applicable
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits
See Index to Exhibits on page 12.
(b) Reports on Form 8-K
The Company did not file any Reports on Form 8-K during the fiscal quarter for which this report is filed.
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Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| SPARTA, INC. |
| /s/ David E. Schreiman | ||||
| Date: | August 14, 2002 | David E. Schreiman Vice President, Treasurer and Chief Financial Officer (Principal Accounting Officer) |
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INDEX TO EXHIBITS
PART II, ITEM 6(a)
| Exhibit Number | Description | |
| 10.27 | First Amended and Restated Loan Agreement dated June 14, 2002, by and between the Company and Union Bank of California, N.A. | |
| 10.28 | Commercial Promissory Note dated June 14, 2002, by and between the Company and Union Bank of California, N.A. | |
| 10.29 | Security Agreement dated June 14, 2002, by and between the Company and Union Bank of California, N.A. | |
| 99.1 | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
| 99.2 | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
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