##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2008
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission File Number 001-32563
 Orchids Paper Products Company
  Delaware
(State or Other Jurisdiction of 
Incorporation or Organization)
    
    23-2956944
(I.R.S. Employer
Identification No.)
 4826 Hunt Street
Pryor, Oklahoma 74361
 (918) 825-0616
 þ o
  Large accelerated filer oAccelerated filer oNon-accelerated filer o(Do not check if a smaller reporting company)Smaller reporting company þ o þ




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##### 



ORCHIDS PAPER PRODUCTS COMPANY
TABLE OF CONTENTS
QUARTERLY REPORT ON FORM 10-Q
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2008
 PagePART I. FINANCIAL INFORMATIONITEM 1.
    
    Financial StatementsBalance Sheets as of September 30, 2008 (Unaudited) and
December 31, 2007
    
    
    3Statements of Income for the three months ended
September 30, 2008 and 2007 (Unaudited) and the nine months ended
September 30, 2008 and 2007 (Unaudited)
    
    
    4Statements of Cash Flows for the nine months ended
September 30, 2008 and 2007 (Unaudited)
    
    
    5Notes to Unaudited Interim Financial Statements
    
    
    6ITEM 2.
    
    Managements Discussion and Analysis of Financial Condition
and Results of Operations
    
    
    9ITEM 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    
    24ITEM 4.
    
    Controls and Procedures
    
    
    24PART II. OTHER INFORMATIONITEM 1.
    
    Legal Proceedings
    
    
    25ITEM 1A.
    
    Risk Factors
    
    
    25ITEM 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    25ITEM 3.
    
    Defaults Upon Senior Securities
    
    
    26ITEM 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    26ITEM 5.
    
    Other Information
    
    
    26ITEM 6.
    
    Exhibits
    
    
    26Signatures
    
    
    27EX-10.1EX-10.2EX-31.1EX-31.2EX-32.1EX-32.2
  -2-




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PART 1. FINANCIAL INFORMATION
 
 ITEM 1.
 
 ORCHIDS PAPER PRODUCTS COMPANY
BALANCE SHEETS
(Dollars in thousands, except share data)
 September 30,
    
    
    December 31,2008
    
    
    2007(unaudited)ASSETSCurrent assets:Cash
    
    $
    12
    
    
    $
    3Accounts receivable, net of allowance of
$146 in 2008 and $100 in 2007
    
    
    8,048
    
    
    
    5,527Inventories, net
    
    
    5,960
    
    
    
    4,874Income taxes receivable
    
    
    
    
    
    
    24Prepaid expenses
    
    
    602
    
    
    
    381Deferred income taxes
    
    
    516
    
    
    
    516Total current assets
    
    
    15,138
    
    
    
    11,325Property, plant and equipment
    
    
    69,058
    
    
    
    64,899Accumulated depreciation
    
    
    (10,352
    )
    
    
    (8,043
    )Net property, plant and equipment
    
    
    58,706
    
    
    
    56,856Deferred debt issuance costs, net of accumulated
amortization of $595 in 2008 and $570 in 2007
    
    
    97
    
    
    
    122Total assets
    
    $
    73,941
    
    
    $
    68,303LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    5,034
    
    
    $
    4,760Accrued liabilities
    
    
    2,950
    
    
    
    2,460Current portion of long-term debt
    
    
    2,728
    
    
    
    2,391Total current liabilities
    
    
    10,712
    
    
    
    9,611Long-term debt, less current portion
    
    
    23,379
    
    
    
    23,264Deferred income taxes
    
    
    8,613
    
    
    
    7,386Stockholders equity:Common stock, $.001 par value, 25,000,000
shares authorized, 6,328,986 and 6,322,648 issues and
outstanding in 2008 and 2007, respectively
    
    
    6
    
    
    
    6Additional paid-in capital
    
    
    22,160
    
    
    
    21,879Common stock warrants
    
    
    134
    
    
    
    141Retained earnings
    
    
    8,937
    
    
    
    6,016Total stockholders equity
    
    
    31,237
    
    
    
    28,042Total liabilities and stockholders equity
    
    $
    73,941
    
    
    $
    68,303
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ORCHIDS PAPER PRODUCTS COMPANY
STATEMENTS OF INCOME
 Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2008
    
    
    2007
    
    
    2008
    
    
    2007(unaudited)
    
    
    (unaudited)
    
    
    (unaudited)
    
    
    (unaudited)(Dollars in thousands, except share and per share data)Net sales
    
    $
    23,312
    
    
    $
    19,218
    
    
    $
    65,902
    
    
    $
    54,370Cost of sales
    
    
    19,518
    
    
    
    15,997
    
    
    
    56,297
    
    
    
    46,664Gross profit
    
    
    3,794
    
    
    
    3,221
    
    
    
    9,605
    
    
    
    7,706Selling, general and
administrative expenses
    
    
    1,551
    
    
    
    1,296
    
    
    
    4,427
    
    
    
    3,525Operating income
    
    
    2,243
    
    
    
    1,925
    
    
    
    5,178
    
    
    
    4,181Interest expense
    
    
    310
    
    
    
    635
    
    
    
    1,041
    
    
    
    2,216Other income, net
    
    
    (3
    )
    
    
    (2
    )
    
    
    (9
    )
    
    
    (29
    )Income before income taxes
    
    
    1,936
    
    
    
    1,292
    
    
    
    4,146
    
    
    
    1,994Provision for income taxes:State (refund)
    
    
    (2
    )
    
    
    
    
    
    
    (2
    )
    
    
    Current
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Deferred
    
    
    515
    
    
    
    156
    
    
    
    1,227
    
    
    
    246Net income
    
    $
    1,423
    
    
    $
    1,136
    
    
    $
    2,921
    
    
    $
    1,748Net income per share:Basic
    
    $
    0.22
    
    
    $
    0.18
    
    
    $
    0.46
    
    
    $
    0.28Diluted
    
    $
    0.22
    
    
    $
    0.18
    
    
    $
    0.45
    
    
    $
    0.27Shares used in calculating net
income per share:Basic
    
    
    6,328,986
    
    
    
    6,234,346
    
    
    
    6,328,343
    
    
    
    6,234,346Diluted
    
    
    6,499,686
    
    
    
    6,421,111
    
    
    
    6,526,511
    
    
    
    6,425,527
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ORCHIDS PAPER PRODUCTS COMPANY
STATEMENTS OF CASH FLOWS
 Nine Months Ended September 30,2008
    
    
    2007(unaudited)
    
    
    (unaudited)(Dollars in thousands)Cash Flows From Operating ActivitiesNet income
    
    $
    2,921
    
    
    $
    1,748Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation and amortization
    
    
    2,334
    
    
    
    2,404Provision for doubtful accounts
    
    
    46
    
    
    
    15Deferred income taxes
    
    
    1,227
    
    
    
    246Stock option plan expense
    
    
    259
    
    
    
    331Changes in cash due to changes in operating assets
and liabilities:Accounts receivable
    
    
    (2,568
    )
    
    
    (975
    )Inventories
    
    
    (1,085
    )
    
    
    (484
    )Income taxes receivable
    
    
    24
    
    
    
    1,218Prepaid expenses
    
    
    (221
    )
    
    
    (166
    )Accounts payable
    
    
    274
    
    
    
    255Accrued liabilities
    
    
    490
    
    
    
    518Net cash provided by operating activities
    
    
    3,701
    
    
    
    5,110Cash Flows From Investing ActivitiesPurchases of property, plant and equipment
    
    
    (4,159
    )
    
    
    (477
    )Proceeds from the sale of restricted certificate of deposit
    
    
    
    
    
    
    1,500Net cash provided by (used in) investing activities
    
    
    (4,159
    )
    
    
    1,023Cash Flows From Financing ActivitiesNew borrowings on long-term debt
    
    
    
    
    
    
    26,500Retirement of borrowings on long-term debt
    
    
    
    
    
    
    (25,866
    )Principal payments on long-term debt
    
    
    (1,668
    )
    
    
    (1,720
    )Net borrowings (repayments) on revolving credit line
    
    
    2,120
    
    
    
    (4,903
    )Proceeds from the exercise of warrants attached to subordinated debentures
    
    
    15
    
    
    
    Deferred debt issuance costs
    
    
    
    
    
    
    (144
    )Net cash provided by (used in) financing activities
    
    
    467
    
    
    
    (6,133
    )Net change in cash
    
    
    9
    
    
    
    Cash, beginning of period
    
    
    3
    
    
    
    3Cash, end of period
    
    $
    12
    
    
    $
    3Supplemental Disclosure:Interest paid
    
    $
    963
    
    
    $
    2,117Income tax refund
    
    $
    2
    
    
    $
    
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ORCHIDS PAPER PRODUCTS COMPANY
NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS
 Note 1  Basis of Presentation
     Note 2  Commitments and Contingencies
   -6-




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Note 3  Earnings per Share
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Net income  ($ thousands)
    
    $
    1,423
    
    
    $
    1,136
    
    
    $
    2,921
    
    
    $
    1,748Weighted average shares outstanding
    
    
    6,328,986
    
    
    
    6,234,346
    
    
    
    6,328,343
    
    
    
    6,234,346Effect of stock options
    
    
    65,500
    
    
    
    84,819
    
    
    
    82,065
    
    
    
    90,999Effect of dilutive warrants
    
    
    105,200
    
    
    
    101,946
    
    
    
    116,103
    
    
    
    100,182Weighted average shares
outstanding  assuming dilution
    
    
    6,499,686
    
    
    
    6,421,111
    
    
    
    6,526,511
    
    
    
    6,425,527Earnings  per common share:Basic
    
    $
    0.22
    
    
    $
    0.18
    
    
    $
    0.46
    
    
    $
    0.28Diluted
    
    $
    0.22
    
    
    $
    0.18
    
    
    $
    0.45
    
    
    $
    0.27Stocks options not considered
above because they were
anti-dilutive
    
    
    53,750
    
    
    
    
    
    
    
    86,250
 Note 4  Stock Incentive Plan
   Grant
    
    Number
    
    Exercise
    
    Risk-Free
    
    Estimated
    
    Dividend
    
    ExpectedDate
    
    of Shares
    
    Price
    
    Interest Rate
    
    Volatility
    
    Yield
    
    LifeFeb-07
    
    
    3,750
    
    
    $
    8.58
    
    
    
    4.83
    %
    
    
    40
    %
    
    None
    
    5 yearsJun-07
    
    
    28,750
    
    
    $
    5.18
    
    
    
    5.09
    %
    
    
    38
    %
    
    None
    
    5 yearsAug-07
    
    
    225,000
    
    
    $
    6.81
    
    
    
    4.63
    %
    
    
    40
    %
    
    None
    
    5-7 yearsMay-08
    
    
    28,750
    
    
    $
    7.48
    
    
    
    3.78
    %
    
    
    41
    %
    
    None
    
    5 yearsJun-08
    
    
    20,000
    
    
    $
    7.80
    
    
    
    3.98
    %
    
    
    40
    %
    
    None
    
    5-7 years
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Note 5  Major Customers and Concentration of Credit Risk
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,2008
    
    
    2007
    
    
    2008
    
    
    2007(in thousands)Converted product net sales
    
    $
    19,300
    
    
    $
    16,482
    
    
    $
    53,798
    
    
    $
    48,068Parent roll net sales
    
    
    4,012
    
    
    
    2,736
    
    
    
    12,104
    
    
    
    6,302Total net sales
    
    $
    23,312
    
    
    $
    19,218
    
    
    $
    65,902
    
    
    $
    54,370
  Note 6  New Accounting Standards
   -8-




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Note 7  Subsequent Events
  
    
    the capital expenditures facility was increased to $4.0 million from $3.0 million, with
advances based on 90% of costs as compared to 80% of costs prior to the amendment;
    
    the capital expenditures covenant limit for 2008 was increased to $6.4 million from
$6.25 million, and was increased to $2.0 million annually thereafter from $1.5 million.
The annual capital expenditures limit will increase to $2.5 million if the Company reaches
an EBITDA threshold for two consecutive quarters, beginning with the third quarter of
2008; and
    
    the capital expenditures exclusion for the waste water pre-treatment project was
increased from $3.0 million to $4.3 million.
 
 ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Forward-Looking Information
  
    
    our business strategy;
    
    the market opportunity for our products, including expected demand for our products;
    
    our estimates regarding our capital requirements; and
    
    any of our other plans, objectives, and intentions contained in this report that are
not historical facts.
  -9-




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
    
    intense competition in our market and aggressive pricing by our competitors could force
us to decrease our prices and reduce our profitability;
    
    a substantial percentage of our converted product revenues are attributable to three
large customers which may decrease or cease purchases at any time;
    
    the disruption in supply or cost of waste paper;
    
    significant indebtedness limits our free cash flow and subjects us to restrictive
covenants relating to the operation of our business;
    
    the availability of and prices for energy;
    
    our exposure to variable interest rates;
    
    the loss of key personnel;
    
    labor interruptions;
    
    the parent roll market is a commodity market and subject to fluctuations in demand and
pricing;
    
    natural disaster or other disruption to our facility;
    
    ability to finance the capital requirements of our business;
    
    cost to comply with government regulations;
    
    failure to purchase the contracted quantity of natural gas may result in financial
exposure ; and
    
    failure to maintain an effective system of internal controls necessary to accurately
report our financial results and prevent fraud.
  -10-




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Overview
 ® ®
  
    
    the market price of our product;
    
    the cost of recycled paper used in producing paper;
    
    the efficiency of operations in both our paper mill and converting operations; and
    
    energy costs.
    -11-




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Comparative Three-Month Periods Ended September 30, 2008 and 2007
 Net Sales
 Three Months Ended September 30,2008
    
    
    2007(in thousands, except averageprice per ton and tons)Converted product net sales
    
    $
    19,300
    
    
    $
    16,482Parent roll net sales
    
    
    4,012
    
    
    
    2,736Total net sales
    
    $
    23,312
    
    
    $
    19,218Total tons shipped
    
    
    13,837
    
    
    
    13,390Average price per ton
    
    $
    1,685
    
    
    $
    1,435
  -12-




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Cost of Sales
 Three Months Ended September 30,2008
    
    
    2007(in thousands, exceptgross profit margin %and paper cost per ton)Cost of paper
    
    $
    11,056
    
    
    $
    9,860Non-paper materials, labor, supplies, etc.
    
    
    7,679
    
    
    
    5,387Sub-total
    
    
    18,735
    
    
    
    15,247Depreciation
    
    
    783
    
    
    
    750Cost of sales
    
    $
    19,518
    
    
    $
    15,997Gross Profit
    
    $
    3,794
    
    
    $
    3,221Gross Profit Margin %
    
    
    16.3
    %
    
    
    16.8
    %Total paper cost per ton consumed
    
    $
    799
    
    
    $
    733
     -13-




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Gross Profit
  Selling, General and Administrative Expenses
 Three Months Ended September 30,2008
    
    
    2007(In thousands, except SG&A as a % of net sales)Commission expense
    
    $
    260
    
    
    $
    224Other S,G&A expenses
    
    
    1,291
    
    
    
    1,072Selling, General & Adm exp
    
    $
    1,551
    
    
    $
    1,296SG&A as a % of net sales
    
    
    6.7
    %
    
    
    6.7
    %
  Operating Income
  Interest Expense and Other Income
 Three Months Ended September 30,2008
    
    
    2007(In thousands)Interest expense
    
    $
    310
    
    
    $
    635Other (income) expense, net
    
    $
    (3
    )
    
    $
    (2
    )
  -14-




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Income Before Income Taxes
  Income Tax Provision
   Comparative Nine-Month Periods Ended September 30, 2008 and 2007
 Net Sales
 Nine Months Ended September 30,2008
    
    
    2007(in thousands, exceptprice per ton and tons)Converted product net sales
    
    $
    53,798
    
    
    $
    48,068Parent roll net sales
    
    
    12,104
    
    
    
    6,302Total net sales
    
    $
    65,902
    
    
    $
    54,370Total tons shipped
    
    
    41,025
    
    
    
    37,367Average price per ton
    
    $
    1,606
    
    
    $
    1,455
  -15-




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Cost of Sales
 Nine Months Ended September 30,2008
    
    
    2007(in thousands, exceptgross profit margin %and paper cost per ton)Cost of paper
    
    $
    33,240
    
    
    $
    27,950Non-paper materials, labor,
supplies, etc.
    
    
    20,747
    
    
    
    16,466Sub-total
    
    $
    53,987
    
    
    $
    44,416Depreciation
    
    
    2,310
    
    
    
    2,248Cost of sales
    
    $
    56,297
    
    
    $
    46,664Gross Profit
    
    $
    9,605
    
    
    $
    7,706Gross Profit Margin %
    
    
    14.6
    %
    
    
    14.2
    %Total paper cost per ton consumed
    
    $
    810
    
    
    $
    748
     -16-




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Gross Profit
   Selling, General and Administrative Expenses
 Nine Months Ended September 30,2008
    
    
    2007(In thousands, exceptSG&A as a % of net sales)Commission expense
    
    $
    753
    
    
    $
    702Other S,G&A expenses
    
    
    3,674
    
    
    
    2,823Selling, General & Adm exp
    
    $
    4,427
    
    
    $
    3,525SG&A as a % of net sales
    
    
    6.7
    %
    
    
    6.5
    %
  Operating Income
  Interest Expense and Other Income
 Nine Months Ended September 30,2008
    
    2007(In thousands)Interest expense
    
    $
    1,041
    
    
    $
    2,216Other (income) expense, net
    
    $
    (9
    )
    
    $
    (29
    )
 -17-




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Income Before Income Taxes
  Income Tax Provision
   Liquidity and Capital Resources
   
    
    the capital expenditures facility was increased to $4.0 million from $3.0 million, with
advances based on 90% of costs as compared to 80% of costs prior to the amendment;
    
    the capital expenditures covenant limit for 2008 was increased to $6.4 million from
$6.25 million, and was increased to $2.0 million annually thereafter from $1.5 million.
The annual capital expenditures limit will increase to $2.5 million if we reach an EBITDA
threshold of $3.0 million for two consecutive quarters, beginning with the third quarter of
2008; and
 -18-




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
    
    the capital expenditures exclusion for the waste water pre-treatment project was
increased from $3.0 million to $4.3 million.
      Nine Months Ended September 30,2008
    
    2007(in thousands)Cash flow provided by (used in):Operating activities
    
    $
    3,701
    
    
    $
    5,110Investing activities
    
    $
    (4,159
    )
    
    $
    1,023Financing activities
    
    $
    467
    
    
    $
    (6,133
    )
    -19-




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
    
    an $8.0 million revolving credit facility with a three-year term; ($2.2 million
outstanding at September 30, 2008). In addition, $681,000 of bank overdrafts are included
with long-term debt at September 30, 2008. The borrowing base for the revolving credit
facility is determined by adding qualified receivables and inventory. At September 30,
2008, the borrowing base for the revolving credit facility was $8.0 million;
    
    a $10.0 million term loan A with a ten-year term that has no principal repayments for
the first 24 months of the loan and then will be amortized as if the loan had an 18-year
life ($10.0 million outstanding at September 30, 2008);
    
    a $16.5 million term loan B with a four-year term that is being amortized as if the
loan had a six-year life ($13.2 million outstanding at September 30, 2008); and
    
    a $4.0 million capital expenditures facility with a four-year term that will be
amortized as if the loan had a five-year life ($0 outstanding at September 30, 2008).
  -20-




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Critical Accounting Policies and Estimates
  Accounts Receivable
 -21-




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Inventory.
 New Accounting Pronouncements
     Non-GAAP Discussion
  -22-




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
    
    it does not reflect our cash expenditures for capital assets;
    
    it does not reflect changes in, or cash requirements for, our working capital
requirements;
    
    it does not reflect the interest expense, or the cash requirements necessary to service
interest or principal payments on our indebtedness;
    
    although depreciation and amortization are non-cash charges, the assets being
depreciated and amortized will often have to be replaced in the future, and EBITDA does
not reflect cash requirements for such replacements; and
    
    other companies, including other companies in our industry, may calculate these
measures differently than we do, limiting their usefulness as a comparative measure.
   Three Months Ended September 30,2008
    
    
    2007(In thousands,except % of net sales)Net income
    
    $
    1,423
    
    
    $
    1,136Plus: Interest expense
    
    
    310
    
    
    
    635Plus: Income tax expense
    
    
    513
    
    
    
    156Plus: Depreciation
    
    
    783
    
    
    
    750EBITDA
    
    $
    3,029
    
    
    $
    2,677% of net sales
    
    
    13.0
    %
    
    
    13.9
    %
  -23-




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Nine Months Ended September 30,2008
    
    
    2007(In thousands,except % of net sales)Net income
    
    $
    2,921
    
    
    $
    1,748Plus: Interest expense
    
    
    1,041
    
    
    
    2,216Plus: Income tax expense
    
    
    1,225
    
    
    
    246Plus: Depreciation
    
    
    2,310
    
    
    
    2,248EBITDA
    
    $
    7,497
    
    
    $
    6,458% of net sales
    
    
    11.4
    %
    
    
    11.9
    %
  
 ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
  
 ITEM 4. Controls and Procedures
   -24-




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PART II. OTHER INFORMATION
 
 ITEM 1. Legal Proceedings
  
 ITEM 1A. Risk Factors
  The parent roll market is a commodity market and subject to fluctuations in demand and pricing.
  Failure to purchase the contracted quantity of natural gas may result in financial exposure.
  
 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
 (a) Unregistered Sales of Equity Securities
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(b) Initial Public Offering and Use of Proceeds from the Sale of Registered Securities
  (c) Repurchases of Equity Securities
  
 ITEM 3. Defaults Upon Senior Securities
  
 ITEM 4. Submission of Matters to a Vote of Security Holders
  
 ITEM 5. Other Information
  
 ITEM 6. Exhibits
  -26-




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##### Table of Contents



SIGNATURES
  ORCHIDS PAPER PRODUCTS COMPANY
 Date: November 10, 2008
    By:
    /s/ Keith R. SchroederKeith R. SchroederChief Financial Officer
(On behalf of the registrant and
as Chief Accounting Officer) -27-




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Exhibit Index
 Exhibit
    
    Description3.1
    
    Amended and Restated Certificate of Incorporation of the
Registrant incorporated by reference to Exhibit 3.1 to the
Registrants Registration Statement on Form S-1 (File No.
333-124173) filed with the Securities and Exchange Commission on
April 19, 2005.3.1.1
    
    Amendment to the Amended and Restated Certificate of Incorporation
of the Registrant incorporated by reference to the Form 10-Q
filed with the Securities and Exchange Commission on August 14,
2007.3.2
    
    Amended and Restated Bylaws of the Registrant incorporated by
reference to Exhibit 3.2 to the Registrants Registration
Statement on Form S-1 (File No. 333-124173) filed with the
Securities and Exchange Commission on April 19, 2005.10.1#
    
    Amendment to Executive Employment Agreement dated August 22, 2008,
between Robert A. Snyder and the Company.10.2
    
    Amendment Three to Second Amended and Restated Agented Credit
Agreement dated November 5, 2008 among the Registrant, Bank of
Oklahoma, N.A., BancFirst and Commerce Bank, N.A.31.1
    
    Certification of Chief Executive Officer Pursuant to Section 302.31.2
    
    Certification of Chief Financial Officer Pursuant to Section 302.32.1
    
    Certification of Chief Executive Officer Pursuant to Section 906.32.2
    
    Certification of Chief Financial Officer Pursuant to Section 906.
 
 #
    
    Indicates management contract or compensatory plan -28-