**UNITED STATESSECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 

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### ** **

### **FORM 10-Q**

 

| **(Mark  One)**                                                                                                                                                                                   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                              |
|                                                                                                                                                                                              | **ý** |   | **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES EXCHANGE ACT OF 1934** |
|                                                                                                                                                                                              |   |   |
| **For the Quarterly Period Ended  March 29, 2003**                                                                                                                                                |
|                                                                                                                                                                                              |   |   |
| **OR**                                                                                                                                                                                            |
|                                                                                                                                                                                              |   |   |
|                                                                                                                                                                                              | **o** |   | **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES EXCHANGE ACT OF 1934** |
|                                                                                                                                                                                              |   |   |
| **FOR THE TRANSITION PERIOD  FROM             TO             ** |
|                                                                                                                                                                                              |   |   |
| **COMMISSION FILE NUMBER 0-13198**                                                                                                                                                                |

 

**MORTON INDUSTRIAL GROUP, INC.**

(Exact name of registrantas specified in its charter)

 

| **Georgia**                                                       |   | **38-0811650**                      |
|-------------------------------------------------------------------|--------|-------------------------------------|
| (State or other  jurisdiction of   Incorporation or organization) |   | (IRS Employer   Identification No.) |
|                                                              |
| **1021 W. Birchwood, Morton, Illinois  61550**                    |
| (Address of principal  executive offices)                         |
|                                                              |
| **(309) 266-7176**                                                |
| (Registrant’s telephone  number, including area code)        |

 

Indicate by checkmark whether the registrant: (1) has filed all reports required to befiled by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the registrantwas required to file such reports), and (2) has been subject to suchfiling requirements for the past 90 days.  Yes ý  No o

 

Indicate by checkmark whether the registrant is an accelerated filer (as defined in Rule 12b-2 ofthe Act).  Yes o  No ý

 

The aggregatemarket value of the common stock held by non-affiliates of the registrant(based upon the last reported sale price on the Nasdaq Small Cap Market) on thelast business day of the registrant’s most recently completed second fiscalquarter was approximately $440,000.

 
|                                      |   | **Outstanding  as of  May 9, 2003** |   |
|-------------------------------------------|--------|-------------------------------------|--------|
| Class A Common Stock, $.01 par value |   | 4,460,547                           |   |
| Class B Common Stock, $.01 par value |   | 200,000                             |   |

 

 

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**MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIESCondensed Consolidated Statements of OperationsFor the Three Months Ended March 29, 2003 and March 30, 2002(Dollars in thousands, except per share data)(Unaudited)**

 
|                                                                     |   | **Three Months Ended** |   |
|--------------------------------------------------------------------------|--------|------------------------|--------|
|                                                                     |   | **March 29, 2003**     |   | **March 30, 2002** |   |
| Net sales                                                                |   | $                      | 32,380 |   | 29,177 |   |
| Cost of sales                                                            |   | 27,789                 |   | 25,060 |   |
| Gross profit                                                             |   | 4,591                  |   | 4,117 |   |
| Operating expenses:                                                      |   |                   |   |   |   |
| Selling expenses                                                         |   | 701                    |   | 706 |   |
| Administrative expenses                                                  |   | 2,607                  |   | 2,251 |   |
| Total operating expenses                                                 |   | 3,308                  |   | 2,957 |   |
| Operating income                                                         |   | 1,283                  |   | 1,160 |   |
| Other income (expense):                                                  |   |                   |   |   |   |
| Interest expense                                                         |   | (933                   | )      | (1,213 | ) |
| Other                                                                    |   | 166                    |   | 237 |   |
| Total other income (expense)                                             |   | (767                   | )      | (976 | ) |
| Earnings before income taxes and discontinued operations                 |   | 516                    |   | 184 |   |
| Income taxes                                                             |   | 200                    |   | — |   |
| Earnings before discontinued operations                                  |   | 316                    |   | 184 |   |
| Discontinued operations (note 3):                                        |   |                   |   |   |   |
| Net earnings (loss) from operations of discontinued plastics  operations |   | 225                    |   | (526 | ) |
| Income taxes                                                             |   | 90                     |   | — |   |
|                                                                     |   | 135                    |   | (526 | ) |
| Net earnings (loss)                                                      |   | 451                    |   | (342 | ) |
| Accretion of discount on preferred shares                                |   | (332                   | )      | (279 | ) |
| Net earnings (loss) available to common shareholders                     |   | $                      | 119    |   | (621 | ) |
| Earnings (loss) per common share – basic and diluted:               |   |                   |   |   |   |
| Earnings (loss) from continuing operations                               |   | $                      | 0.00   |   | (0.02 | ) |
| Earnings (loss) from discontinued operations                             |   | 0.03                   |   | (0.12 | ) |
| Net earnings (loss) available to common shareholders                     |   | $                      | 0.03   |   | (0.14 | ) |

 

See accompanying notes to condensedconsolidated financial statements.

 

2

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**MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIESCondensed Consolidated Balance SheetsMarch 29, 2003 and December 31, 2002(Dollars in thousands)(Unaudited)**

 
|                                                                                             |   | **March 29,   2003** |   | **December 31,   2002** |   |
|--------------------------------------------------------------------------------------------------|--------|----------------------|--------|-------------------------|--------|
| **Assets**                                                                                       |   |                 |   |                    |   |
| Current assets:                                                                                  |   |                 |   |                    |   |
| Trade accounts receivable, less allowance for doubtful accounts of  $132 in 2003 and $92 in 2002 |   | $                    | 7,612  |                    | 5,251  |   |
| Inventories                                                                                      |   | 12,138               |   | 14,322                  |   |
| Prepaid expenses and other current assets                                                        |   | 1,902                |   | 1,179                   |   |
| Deferred income taxes                                                                            |   | 110                  |   | 400                     |   |
| Assets held for sale                                                                             |   | 8,766                |   | 8,990                   |   |
| Total current assets                                                                             |   | 30,528               |   | 30,142                  |   |
| Property, plant, and equipment, net                                                              |   | 22,996               |   | 23,364                  |   |
| Intangible assets, at cost, less accumulated amortization                                        |   | 1,360                |   | 1,336                   |   |
| Deferred income taxes                                                                            |   | 1,351                |   | 1,351                   |   |
| Other assets                                                                                     |   | 613                  |   | 660                     |   |
|                                                                                             |   | $                    | 56,848 |                    | 56,853 |   |
| **Liabilities  and Stockholders’ Equity (Deficit)**                                         |   |                 |   |                    |   |
| Current liabilities:                                                                             |   |                 |   |                    |   |
| Outstanding checks in excess of bank balance                                                     |   | $                    | 2,645  |                    | 1,289  |   |
| Current installments of long-term debt                                                           |   | 5,439                |   | 5,331                   |   |
| Accounts payable                                                                                 |   | 12,189               |   | 14,731                  |   |
| Accrued expenses                                                                                 |   | 6,449                |   | 4,831                   |   |
| Liabilities held for sale                                                                        |   | 6,353                |   | 6,254                   |   |
| Total current liabilities                                                                        |   | 33,075               |   | 32,436                  |   |
| Long-term debt, excluding current installments                                                   |   | 38,647               |   | 39,771                  |   |
| Other liabilities                                                                                |   | 291                  |   | 262                     |   |
| Total liabilities                                                                                |   | 72,013               |   | 72,469                  |   |
| Redeemable preferred stock                                                                       |   | 8,940                |   | 8,608                   |   |
| Stockholders’ equity (deficit):                                                             |   |                 |   |                    |   |
| Class A common stock                                                                             |   | 45                   |   | 45                      |   |
| Class B common stock                                                                             |   | 2                    |   | 2                       |   |
| Additional paid-in capital                                                                       |   | 20,895               |   | 20,895                  |   |
| Retained deficit                                                                                 |   | (45,047              | )      | (45,166                 | )      |
| Total stockholders’ equity (deficit)                                                        |   | (24,105              | )      | (24,224                 | )      |
|                                                                                             |   | $                    | 56,848 |                    | 56,853 |   |

 

See accompanying notes to condensedconsolidated financial statements.

 

3

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**MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIESConsolidated Statement of Stockholders’ Equity (Deficit)For the Three Months Ended March 29, 2003(Dollars in thousands)(Unaudited)**

 
|                                      |   | **Class A********common stock** |   | **Class B********common stock** |   | **Additional  paid-in********capital** |    | **Retained********earnings********(deficit)** |   | **Total** |   |
|-------------------------------------------|--------|---------------------------------|--------|---------------------------------|--------|----------------------------------------|---------|-----------------------------------------------|--------|-----------|--------|
|                                      |   |                            |   |                            |   |                                   |
|                                      |   | **Shares********issued**        |   | **Amount**                      |   | **Shares********issued**               |    | **Amount**                                    |   |      |   |   |
|                                      |   |                            |   |                            |   |                                   |    |                                          |
| Balance, December 31, 2002                |   | 4,460,547                       |   | $                               | 45     |                                   | 200,000 |                                          | $      | 2         |   | $ | 20,895 |   | $ | (45,166 | ) | $ | (24,224 | ) |
| Net earnings                              |   | —                          |   | —                          |   | —                                 |    | —                                        |   | —    |   | 451 |   | 451 |   |
| Accretion of discount on preferred shares |   | —                          |   | —                          |   | —                                 |    | —                                        |   | —    |   | (332 | ) | (332 | ) |
| Balance, March 29, 2003                   |   | 4,460,547                       |   | $                               | 45     |                                   | 200,000 |                                          | $      | 2         |   | $ | 20,895 |   | $ | (45,047 | ) | $ | (24,105 | ) |

 

See accompanying notes to condensedconsolidated financial statements.

 

4

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**MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIESCondensed Consolidated Statements of Cash FlowsFor the Three Months Ended March 29, 2003 and March 30, 2002(Dollars in thousands)(Unaudited)**

 
|                                                                |   | **Three Months Ended** |   |
|---------------------------------------------------------------------|--------|------------------------|--------|
|                                                                |   | **March 29, 2003**     |   | **March 30, 2002** |   |
|                                                                |   |                   |   |   |   |
| Net cash provided by (used in) operating activities                 |   | $                      | 929    |   | (177 | ) |
|                                                                |   |                   |   |   |   |
| Cash flows from investing activities:                               |   |                   |   |   |   |
| Proceeds from sale of machinery and equipment                       |   | —                 |   | 65 |   |
| Capital expenditures                                                |   | (969                   | )      | (756 | ) |
| Net cash used in investing activities                               |   | (969                   | )      | (691 | ) |
|                                                                |   |                   |   |   |   |
| Cash flows from financing activities:                               |   |                   |   |   |   |
| Net repayments under revolving credit facility                      |   | (500                   | )      | (2,641 | ) |
| Increase (decrease) in outstanding checks in excess of bank balance |   | 1,356                  |   | (1,512 | ) |
| Proceeds from issuance of long-term debt                            |   | —                 |   | 6,003 |   |
| Increase in financing fees                                          |   | (300                   | )      | (691 | ) |
| Principal payments on long-term debt and capital leases             |   | (516                   | )      | (291 | ) |
| Net cash provided by financing activities                           |   | 40                     |   | 868 |   |
|                                                                |   |                   |   |   |   |
| Net change in cash                                                  |   | —                 |   | — |   |
|                                                                |   |                   |   |   |   |
| Cash at beginning of period                                         |   | —                 |   | — |   |
| Cash at end of period                                               |   | $                      | — |   | — |   |
|                                                                |   |                   |   |   |   |
| Supplemental disclosures of cash flow information:                  |   |                   |   |   |   |
| Cash paid during the period for:                                    |   |                   |   |   |   |
| Interest                                                            |   | $                      | 525    |   | 1,393 |   |
|                                                                |   |                   |   |   |   |
| Income taxes                                                        |   | $                      | — |   | — |   |

 

See accompanying notes to condensedconsolidated financial statements.

 

5

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**MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIESNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTSFor the Three Months Ended March 29, 2003 and March 30, 2002(Unaudited)**

 

**(1)  Nature of Business**

 

Through ouroperating subsidiaries, we are a contract manufacturer and supplier ofhigh-quality fabricated sheet metal components and subassemblies forindustrial, construction and agricultural original equipment manufacturerslocated primarily in the Midwestern and Southeastern United States.

 

**(2)  Interim Financial Data**

 

The CondensedConsolidated Financial Statements at March 29, 2003, and for the three monthsended March 29, 2003 and March 30, 2002, are unaudited and reflect alladjustments, consisting of normal recurring accruals and other adjustmentswhich, in the opinion of our management, are necessary for a fair presentationof the financial position, operating results, and cash flows for the interimperiods indicated. Our fiscal quarters end on a Saturday (nearest to a quarterend) except for the fourth quarter which ends on December 31. For thequarter ended March 29, 2003, there were 62 shipping days, and for the quarterended March 30, 2002, there were 63 shipping days. Results of operations for theinterim periods are not necessarily indicative of the results of operations forthe full fiscal year.  You should readthe condensed consolidated financial statements in connection with theconsolidated financial statements and notes thereto, together with management’sdiscussion and analysis of financial condition and results of operations ofMorton Industrial Group, Inc. contained in the Company’s Annual Report onForm 10-K for the year ended December 31, 2002, as filed on March 31,2003.

 

**(3)  Discontinued Operations**

 

The results fromdiscontinued operations for the three months ended March 30, 2002 reflect theresults of both Morton Custom Plastics, LLC, which we sold on December 24,2002, and Mid-Central Plastics, Inc., which we currently classify as held forsale.  The results from discontinuedoperations for the three months ended March 29, 2003 reflect the results ofMid-Central Plastics, Inc., which is a contract manufacturer of plasticscomponents for industrial, agricultural and recreational original equipmentmanufacturers located primarily in the Midwestern United States.

 

Amounts held for sale of Mid-Central Plastics, Inc., in thousands ofdollars, as of March 29, 2003 and December 31, 2002 consist of the following:

 

|                                                   |   | **March 29,  2003** |   | **December  31,   2002** |   |
|--------------------------------------------------------|--------|---------------------|--------|--------------------------|--------|
|                                                   |   |                |   |                     |   |
| Accounts receivable, net of  allowance of $67 and $134 |   | $                   | 1,100  |                     | $      | 1,423 |   |
| Inventories                                            |   | 2,247               |   | 2,241                    |   |
| Other current assets                                   |   | 408                 |   | 427                      |   |
| Property, plant and equipment,  net                    |   | 5,011               |   | 4,899                    |   |
| Assets held for sale                                   |   | $                   | 8,766  |                     | $      | 8,990 |   |
| Current liabilities                                    |   | $                   | 2,603  |                     | $      | 2,504 |   |
| Estimated debt required to be  repaid upon sale        |   | 3,750               |   | 3,750                    |   |
| Liabilities held for sale                              |   | $                   | 6,353  |                     | $      | 6,254 |   |

 

**(4) Inventory**

 

The Company’sinventory, in thousands of dollars, as of March 29, 2003, and December 31,2002, is summarized as follows:

 

|                                                        |   | **March 29,  2003** |   | **December  31,   2002** |   |
|-------------------------------------------------------------|--------|---------------------|--------|--------------------------|--------|
|                                                        |   |                |   |                     |   |
| Raw materials,  purchased parts and manufactured components |   | $                   | 2,588  |                     | $      | 3,645 |   |
| Work-in-process                                             |   | 6,305               |   | 6,087                    |   |
| Finished goods                                              |   | 3,245               |   | 4,590                    |   |
|                                                        |   |                |   |                     |   |
|                                                        |   | $                   | 12,138 |                     | $      | 14,322 |   |

 

6

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**(5)  Earnings Per Share**

 

The followingreflects the reconciliation of the numerators and denominators of the earningsper share and the earnings per share assuming dilution computations:

 
|                                                       |   | **Quarter  Ended March 29, 2003** |    | **Quarter  Ended March 30, 2002** |      |
|------------------------------------------------------------|--------|-----------------------------------|---------|-----------------------------------|-----------|
|                                                       |   | **Earnings  (Numerator)**         |    | **Shares   (Denominator)**        |      | **Per Share   Amount** |   | **(Loss)   (Numerator)** |   | **Shares   (Denominator)** |   | **Per Share   Amount** |   |
|                                                       |   |                              |    |                              |      |   |   |   |   |   |   |   |   |
| Basic earnings  (loss) available to common shareholders    |   | $                                 | 119,000 |                              | 4,660,547 |   | $ | 0.03 |   | $ | (621,000 | ) | 4,600,850 |   | $ | (0.14 | ) |
|                                                       |   |                              |    |                              |      |   |   |   |   |   |   |   |   |
| Effect of  dilutive securities, stock options and warrants |   |                              |    | 224,529                           |      | — |   |   |   | — |   | — |   |
|                                                       |   |                              |    |                              |      |   |   |   |   |   |   |   |   |
| Diluted earnings  (loss) available to common shareholders  |   | $                                 | 119,000 |                              | 4,885,076 |   | $ | 0.03 |   | $ | (621,000 | ) | 4,600,850 |   | $ | (0.14 | ) |

 

At March 29, 2003and March 30, 2002, 911,620 and 1,334,615, respectively, options and warrantswere excluded from the computation of diluted earnings per share due to theiranti-dilutive effect. 

 

**(6)  Segment Reporting**

 

Due to thepreviously reported sale of Morton Custom Plastics, LLC., and the anticipatedsale of Mid-Central Plastics, Inc., we have only one remaining segment – thecontract metals fabrication segment.

 

**(7)  Debt**

 

In February 2002, we entered into a new secured revolving creditfacility with a syndicate of banks led by Harris Trust and Savings Bank, asAgent (the Harris syndicate). The revolving credit agreement permits us toborrow up to a maximum of $21.0 million. The agreement requires payment of aquarterly commitment fee of .50% per annum of the average daily unused portionof the revolving credit facility. Interest is due monthly and is based on bankprime plus 1.5% (effective rate of 5.75% at March 29, 2003).  Alternatively, we could select a LIBOR plus4.0% interest rate. The amount available under the original provisions of therevolving credit facility was limited to 85% of qualified accounts receivable,50% of eligible inventory, plus $2.5 million of other assets. The revolvingcredit agreement was originally set to mature on July 1, 2003. Asdescribed below, the date has been extended to April 1, 2004.  At March 29, 2003, we had $18.1 millionoutstanding and $699,000 available under this credit facility.

 

InFebruary 2002, we entered into an amended and restated secured term loanarrangement with the Harris syndicate for a term loan of $32.9 million. The newHarris syndicate term loan arrangement replaced existing term loans and did notprovide additional availability. The term loan under this financing arrangementis amortized monthly with principal payments ranging from $235,000 to $500,000and the balance of $24.9 million due originally on July 1, 2003 (now extendedto April 1, 2004). Interest is due monthly and is based on bank prime plus 1.5%(effective rate of 5.75% at March 29, 2003). Alternatively, we could select a LIBOR plus 4.0% interest rate.

 

The February, 2002 Harris syndicate agreement has been amended threetimes, most recently on February 28, 2003. Among the key provisions of theamendments: (i) extension of the maturity date to April 1, 2004; (ii) revisionsin the monthly amortization of principal, with $50,000 payable on February 28,2003, $100,000 payable on March 31, 2003, $350,000 payable on April 30, 2003,$500,000 payable each month end from May 31, 2003 through December 31, 2003,and $250,000 payable each month end thereafter until the April 1, 2004 maturitydate, at which time the term loan balance of $22.2 million will be due.  Also, effective February 28, 2003, the limitof eligible inventory under the revolving credit facility was increased to 60%and the amount of other assets eligible became $3.5 million.  The Company intends to obtain loans orfunding support from other sources, or extend its existing credit facility, bythe maturity date of the current agreement, but there are no assurances that wewill be successful in our efforts.

 

In connection withthese Harris syndicate loans, we have granted the lender a first lien on all ofour accounts receivable, inventory, equipment and various other assets. TheseHarris syndicate debt agreements contain restrictions on capital expenditures, additional debt or liens,investments, mergers and acquisitions, asset sales and payments such as dividendsor stock repurchases. No amounts are available for the payment of dividends atMarch 29, 2003.  The agreements alsoimpose various financial covenants, including financial performance ratios.

 

7

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Should we sell the Mid-Central Plastics, Inc. operations prior tomaturity of the Harris syndicate loans, a portion of the net cash proceeds fromthe sale must be applied against the balance of the revolving line ofcredit.  We estimate the amount requiredto be repaid to be $3.75 million, which is included in liabilities held forsale (Note 3).

 

**(8)  Stock Option Plan**

** **

We account for ourstock option plan in accordance with the provisions of Accounting PrinciplesBoard (“APB”) Opinion No. 25, *Accounting for Stock Issued to Employees,*and related interpretations. As such, we would record compensation expense onthe date of grant only if the current market price of the underlying stockexceeded the exercise price. We issue all of our options at the current marketprice on the date of issuance and, accordingly, we have not recognized anystock-based employee compensation cost for stock options in our financialstatements.

 

The per share weighted-average fair value of stockoptions granted during the first quarter of 2003 was $0.13 on the date of grantusing the Black Scholes option-pricing model with the followingweighted-average assumptions: expected dividend yield of 0%, risk-free interestrate of 6%, volatility of 91%, and an expected life of 10 years.  We did not grant any stock options duringthe first quarter of 2002.

 

Had we determined compensation cost based on the fairvalue at the grant date for our stock options under SFAS No. 123, *Accountingfor Stock-Based Compensation*, our net earnings, in thousands ofdollars, would have been reduced to the pro forma amounts indicated below:

 
|                                                                                                     |   | **2003** |   | **2002** |   |
|----------------------------------------------------------------------------------------------------------|--------|----------|--------|----------|--------|
| Net earnings (loss) available  to common shareholders:                                                   |   |     |   |     |   |
| As reported                                                                                              |   | $        | 119    |     | (621   | ) |
| Total stock-based employee  compensation expense determined under fair value based method for all awards |   | (36      | )      | (54      | )      |
| Pro forma                                                                                                |   | $        | 83     |     | (675   | ) |
| Basic and diluted  earnings  (loss) available to common  shareholders per share:                    |   |     |   |     |   |
| As reported                                                                                              |   | $        | 0.03   |     | (0.14  | ) |
| Pro forma                                                                                                |   | $        | 0.02   |     | (0.15  | ) |

 

**(9)  Impact of Recently Issued AccountingStandards**

 

In June 2002, FASBissued SFAS No. 146, *Accounting for Costs Associated with Exit or DisposalActivities.*SFAS No. 146 requires companies recognize costsassociated with exit or disposal activities when they are incurred rather thanat the date of a commitment to an exit or disposal plan. SFAS No. 146 is to beapplied prospectively to exit or disposal activities initiated after December31, 2002. The adoption of this statement did not have a material impact onfinancial position, results of operations, or cash flows.

 

On December 31,2002, FASB issued SFAS No. 148, *Accounting for Stock-Based Compensation—Transitionand Disclosure.*SFAS No. 148 amends SFAS No. 123, *Accountingfor Stock-Based Compensation*, to provide alternative methods of transitionfor a voluntary change to the fair value based method of accounting forstock-based employee compensation. In addition, SFAS No. 148 amends thedisclosure requirements of SFAS No. 123 to require prominent disclosures inboth annual and interim financial statements about the method of accounting forstock-based employee compensation and the effect of the method used on reportedresults. The Company does not currently have plans to change to the fair valuemethod of accounting for stock-based compensation. The disclosure requirementshave been implemented.

 

In November 2002,FASB issued Interpretation No. 45, *Guarantor’s Accounting and Disclosure Requirementsfor Guarantees, Including Indirect Guarantees of Indebtedness of Others*(“Interpretation 45”), which addresses the disclosure to be made by a guarantorin its interim and annual financial statements about its obligations underguarantees. Interpretation 45 also requires the recognition of a liability by aguarantor at the inception of certain guarantees.

 

Interpretation 45requires the guarantor to recognize a liability for the non-contingentcomponent of the guarantee, which is the obligation to stand ready to performin the event that specified triggering events or conditions occur. The initialmeasurement of this liability is the fair value of the guarantee at inception.The recognition of the liability is required even if it is not probable thatpayments will be required under the guarantee or if the guarantee was issuedwith a premium payment or as part of a transaction with multiple elements. Theadoption of Interpretation 45 did not have a material impact on the financialstatements.

 

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In January 2003,FASB issued Interpretation 46, Consolidation of Variable Interest Entities(“Interpretation 46”), which addresses consolidation of certain variableinterest entities and is effective January 31, 2003. The Company does notanticipate that the adoption of Interpretation 46 will have a material impacton its financial statements.

 

**ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OFOPERATIONS**

 

The followingdiscussion and analysis describes changes in the Company’s financial conditionsince December 31, 2002. The analysis of results of operations comparesthe quarters ended March 29, 2003 and March 30, 2002.  Any references to December 31, 2002 relate to data found in Form10-K as filed with the Securities and Exchange Commission on March 31, 2003.

 

**RESULTSOF OPERATIONS**

 

**FIRSTQUARTER, 2003 VERSUS FIRST QUARTER, 2002**

 

Our net revenuesfor the first quarter, 2003 were $32.4 million compared to$29.2 million for the first quarter of 2002, an increase of$3.2 million, or 11.0%.  The salesincrease resulted primarily from increased demand by existing customers due toa combination of production order awards for new parts and general volumeincreases on existing parts.

 

Our sales toDeere & Company and Caterpillar Inc., were approximately 91% and92% of our revenues for the first quarters, 2003 and 2002, respectively.  Revenues from these customers increasedapproximately 10% from the same period in 2002, due to a combination ofproduction order awards for new parts and general volume increases on existingparts.

 

Our gross profitsfor the first quarter, 2003 increased by approximately $474,000, an increase of11.5%, versus the same three months in 2002. The overall gross profitpercentage increased to 14.2% for the first quarter of 2003 from 14.1% for thefirst quarter of 2002. The increase in gross profit dollars resulted primarilyfrom increased sales.  The modestincrease in the gross profit percentage resulted from various continuingmanufacturing cost savings initiatives, offset by modest continued pricingpressure from customers.

 

Our selling andadministrative expenses for the first quarter, 2003 amounted to$3.3 million, or 10.2% of net sales compared to $3.0 million, or10.1% of net sales for the first quarter of 2002.  The 11.9% increase in costs related to the increase in sales.

 

Our interestexpense was $0.9 million for the first quarter of  2003, compared with $1.2 million for thefirst quarter of 2002.  While interestrates have remained steady for comparable quarters, a decrease in the overalldebt level has decreased interest expense for the comparable quarters.

 

Our other incomewas $166,000 for the first quarter of 2003, compared with other income of$237,000 for the first quarter of 2002, primarily due to unrealized gains onthe Company’s interest rate swap instruments. These swap agreements expire at the end of June, 2003.

 

For the firstquarter of 2003, we recorded a tax provision of $200,000 (approximately 39%) onpre-tax income of $516,000 from continuing operations, and a tax provision of$90,000 (40%) on pre-tax income of $225,000 from discontinued operations. Wewill utilize net operating losses to the extent of taxable income, and we haverecorded a resulting decrease in the current deferred tax asset.  For the first quarter of 2002, we did notprovide a tax provision on $184 of pre-tax income. The impact on the netoperating loss carryforward was offset by changes in the valuation allowancewith no impact on the net deferred tax assets.

 

Discontinuedoperations reflect pre-tax earnings of $225,000 for the first quarter of 2003compared to a loss of $526,000 in the first quarter of 2002.  As described in Note 3 above, the firstquarter of 2003 includes only the operations of Mid-Central Plastics, Inc.,while the first quarter of 2002 also included the operations of Morton CustomPlastics, LLC, which was sustaining losses from its operations.

 

**LIQUIDITYAND CAPITAL RESOURCES**

 

Our consolidated working capital at March 29, 2003 was a deficit of$2.5 million compared to a working capital deficit of $2.3 million atDecember 31, 2002. This represents a decrease in working capital ofapproximately $0.2 million.  Duringthe quarter ended March 29, 2003, there were no significant changes in totalcurrent assets or total current liabilities as compared with December 31, 2002.

 

In February 2002, we entered into a new secured revolving creditfacility with a syndicate of banks led by Harris Trust and Savings Bank, asAgent (the Harris syndicate). The revolving credit agreement permits us toborrow up to a maximum of $21.0 million. The agreement requires payment of aquarterly commitment fee of .50% per annum of the average daily unused portionof the revolving credit facility. Interest is due monthly and is based on bankprime plus 1.5% (effective rate of 5.75% at March 29, 2003).  Alternatively, we could select a LIBOR plus4.0% interest rate. The amount available under the original provisions of therevolving credit facility was limited to 85% of qualified 

 

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accountsreceivable, 50% of eligible inventory, plus $2.5 million of other assets. Therevolving credit agreement was originally set to mature on July 1, 2003.As described below, the date has been extended to April 1, 2004.  At March 29, 2003, we had $18.1 million outstandingand $699,000 available under this credit facility.

 

InFebruary 2002, we entered into an amended and restated secured term loanarrangement with the Harris syndicate for a term loan of $32.9 million. The newHarris syndicate term loan arrangement replaced existing term loans and did notprovide additional availability. The term loan under this financing arrangementis amortized monthly with principal payments ranging from $235,000 to $500,000and the balance of $24.9 million due originally on July 1, 2003 (now extendedto April 1, 2004). Interest is due monthly and is based on bank prime plus 1.5%(effective rate of 5.75% at March 29, 2003). Alternatively, we could select a LIBOR plus 4.0% interest rate.

 

The February, 2002 Harris syndicate agreement has been amended threetimes, most recently on February 28, 2003. Among the key provisions of theamendments: (i) extension of the maturity date to April 1, 2004; (ii) revisionsin the monthly amortization of principal, with $50,000 payable on February 28,2003, $100,000 payable on March 31, 2003, $350,000 payable on April 30, 2003,$500,000 payable each month end from May 31, 2003 through December 31, 2003,and $250,000 payable each month end thereafter until the April 1, 2004 maturitydate, at which time the term loan balance of $22.2 million will be due.  Also, effective February 28, 2003, the limitof eligible inventory under the revolving credit facility was increased to 60%and the amount of other assets eligible became $3.5 million.  All of our indebtedness to the Harrissyndicate matures on April 1, 2004. We intend to obtain loans or fundingsupport from other sources, or extend the existing credit facility by thematurity date of the current agreement, but there are no assurances that wewill be successful in our efforts.

 

In connection with these Harris syndicate loans, we have granted thelender a first lien on all of our accounts receivable, inventory, equipment andvarious other assets. These Harris syndicate debt agreements containrestrictions on capital expenditures, additional debt or liens, investments,mergers and acquisitions, asset sales and payments such as dividends or stockrepurchases. No amounts are available for the payment of dividends at March 29,2003.  The agreements also imposevarious financial covenants, including financial performance ratios.

 

Should we sell the Mid-Central Plastics, Inc. operations prior tomaturity of the Harris syndicate loans, a portion of the net cash proceeds fromthe sale must be applied against the balance of the revolving line ofcredit.  We estimate the amount requiredto be repaid to be $3.75 million, which is included in liabilities held forsale (Note 3).

 

In connection with the Harris syndicate financing, we have two fixedinterest rate swap agreements with a commercial bank (the “counter party”). Thefirst agreement has a notional principal amount of $2.0 million and atermination date of May 31, 2003. The second agreement has a notionalprincipal amount of $13.9 million and a termination date of June 30,2003. The notional principal amount declines over the term of both agreementsbased upon a defined amortization schedule. The counter party waived itsunilateral right to cancel both agreements as of June 30, 2001. Asdescribed in Item 7A below, these agreements are for the purpose of limitingthe effects of interest rate increases on half of the Company’s floating rateterm debt.

 

Historically, we have met our near term liquidity requirements with cashflow from operations, the Harris syndicate line of credit, and management ofour working capital to reflect current levels of operations. The nationaleconomic slowdown has increased pressure on these sources of liquidity. TheFebruary, 2002 Harris syndicate revolving credit facility and term loansreplaced existing credit facilities and did not provide additionalavailability.  We anticipate that theFebruary, 2002 agreements with the Harris syndicate, as amended on February 28,2003, will assist us in meeting our liquidity requirements through the term ofthese agreements.

 

*Preferred Stock*

 

As part of thefinancing for the 1999 Morton Custom Plastics, LLC acquisition from WorthingtonIndustries, Inc. (Worthington) , we issued 10,000 shares of redeemablepreferred stock, which becomes redeemable on April 15, 2004 at $1,000 per shareplus any dividends accrued since April 15, 1999. We recorded the$10 million face value preferred stock at its fair value of$4.25 million. We are accreting the discount over a five year period usingthe effective yield method. Dividends are payable in kind at the rate of 8% perannum. Certain provisions of the agreement with Worthington preclude thepayment of dividends, and no dividends have been accrued since 1999. There arelegal proceedings related to certain Worthington matters as described inPart II, Item 1.  We plan tocontinue negotiations with Worthington to resolve all of the issues presentedby the preferred stock within the limitations of our available liquidity in2004, but there are no assurances that we will be successful in our efforts.

 

# ***Capital Expenditures***

 

We incurred $0.9 million of capital expenditures during the firstquarter of 2003, including $0.8 related to continuing operations, primarily forthe update and purchase of manufacturing equipment.

 

We estimate that our capital expenditures in 2003 will totalapproximately $2.4 million, of which $1.0 million will be for newproduction equipment and the remaining $1.4 million will be for normalreplacement items.

 

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*Significant Cash Commitments*

 

The followingtable summarizes the Company’s contractual obligations at March 29, 2003:

 
|                                |   | **Payments  Due by Period** |   |
|-------------------------------------|--------|-----------------------------|--------|
| **(In Thousands)**                  |   | **Total**                   |   | **Less than  1 Year** |   | **1 - 3  Years** |   | **4 - 5  Years** |   | **After 5  Years** |   |
| Bank indebtedness                   |   |                        |   |   |   |   |   |   |   |   |   |
| Term loan                           |   | $                           | 27,280 |   | 5,100 |   | 22,180 |   | — |   | $ | — |   |
| Revolving line of credit            |   | 18,100                      |   | — |   | 18,100 |   | — |   | — |   |
| Other debt obligations              |   | 2,221                       |   | 339 |   | 1,237 |   | 645 |   | — |   |
| Operating leases                    |   | 20,816                      |   | 6,400 |   | 12,186 |   | 2,230 |   | — |   |
|                                |   |                        |   |   |   |   |   |   |   |   |   |
| Total contractual cash  obligations |   | $                           | 68,417 |   | 11,839 |   | 53,703 |   | 2,875 |   | $ | — |   |

 

Under our bankcredit facility, we have $618,000 standby letters of credit outstanding atMarch 29, 2003 in connection with lease obligations.  Management expects that cash flow from operations andavailability under its bank revolving line of credit will assist us in meetingour liquidity requirements through the term of its bank credit facility.At  March 29, 2003, we had $699,000 inunused availability under the bank revolving line of credit.

 

As describedpreviously in the Financial Position and Liquidity section of this Form 10-Q,the preferred stock issued by the Company becomes redeemable on April 15, 2004.There are legal proceedings related to certain Worthington matters as describedin Part II, Item 1. We plan to continue negotiations with Worthington toresolve all of the issues presented by the preferred stock, within thelimitations of our available liquidity in 2004, but there are no assurancesthat we will be successful in our efforts.

 

**IMPACTOF RECENTLY ISSUED ACCOUNTING STANDARDS**

 

In June 2002, FASBissued SFAS No. 146, *Accounting for Costs Associated with Exit or DisposalActivities.*SFAS No. 146 requires companies recognize costsassociated with exit or disposal activities when they are incurred rather thanat the date of a commitment to an exit or disposal plan. SFAS No. 146 is to beapplied prospectively to exit or disposal activities initiated after December31, 2002. The adoption of this statement did not have a material impact onfinancial position, results of operations, or cash flows.

 

On December 31,2002, FASB issued SFAS No. 148, *Accounting for Stock-Based Compensation—Transitionand Disclosure.*SFAS No. 148 amends SFAS No. 123, *Accountingfor Stock-Based Compensation*, to provide alternative methods oftransition for a voluntary change to the fair value based method of accountingfor stock-based employee compensation. In addition, SFAS No. 148 amends thedisclosure requirements of SFAS No. 123 to require prominent disclosures inboth annual and interim financial statements about the method of accounting forstock-based employee compensation and the effect of the method used on reportedresults. The Company does not currently have plans to change to the fair valuemethod of accounting for stock-based compensation. The disclosure requirementshave been implemented.

 

In November 2002,FASB issued Interpretation No. 45, *Guarantor’s Accounting and Disclosure Requirementsfor Guarantees, Including Indirect Guarantees of Indebtedness of Others*(“Interpretation 45”), which addresses the disclosure to be made by a guarantorin its interim and annual financial statements about its obligations underguarantees. Interpretation 45 also requires the recognition of a liability by aguarantor at the inception of certain guarantees.

 

Interpretation 45requires the guarantor to recognize a liability for the non-contingentcomponent of the guarantee, which is the obligation to stand ready to performin the event that specified triggering events or conditions occur. The initialmeasurement of this liability is the fair value of the guarantee at inception.The recognition of the liability is required even if it is not probable thatpayments will be required under the guarantee or if the guarantee was issuedwith a premium payment or as part of a transaction with multiple elements. Theadoption of Interpretation 45 did not have a material impact on the financialstatements.

 

In January 2003, FASB issued Interpretation 46, Consolidationof Variable Interest Entities (“Interpretation 46”), which addressesconsolidation of certain variable interest entities and is effective January31, 2003. The Company does not anticipate that the adoption of Interpretation46 will have a material impact on its financial statements.

 

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**FORWARDLOOKING STATEMENTS**

 

“Safe Harbor” Statement Under The PrivateSecurities Litigation Reform Act Of 1995: This quarterly report contains“forward looking statements” within the meaning of Section 27A of theSecurities Act of 1933 and Section 21E of the Securities Exchange Act of1934, including statements containing the words “anticipates,” “believes,”“intends,” “estimates,” “expects,” “projects” and similar words. The forwardlooking statements involve known and unknown risks, uncertainties and otherfactors that may cause our actual results to be materially different from anyfuture results expressed or implied by such forward looking statements. Suchfactors include, among others, the following: the loss of certain significantcustomers; the cyclicality of our construction and agricultural sales; risksassociated with our acquisitions; the orders of our two major customers;general economic and business conditions, both nationally and in the markets inwhich we operate or will operate; competition; and other factors referenced inthe Company’s reports and registration statements filed with the Securities andExchange Commission. Given these uncertainties, prospective investors arecautioned not to place undue reliance on such forward looking statements. Theforward looking statements contained herein speak only of the Company’sexpectation as of the date of this quarterly report. We disclaim anyobligations to update any such factors or publicly announce the result of anyrevisions to any of the forward looking statements contained herein to reflectfuture events or developments.

 

**ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK**

 

We are exposed tointerest rate changes primarily as a result of our lines of credit and longterm debt used for maintaining liquidity, funding capital expenditures, andfunding the growth of our business. Our interest rate risk management objectiveis to limit the impact of interest rate changes on earnings and cash flow andto lower overall borrowing costs. To achieve our objectives, we entered into afinancing agreement with a bank syndicate. This agreement contains a term loan and a revolving creditfacility.  Interest is based on our leadbank’s prime rate plus an applicable variable margin.  We have also entered into two interest rate swap agreements, asrequired by our bank syndicate financing arrangement, to limit the effect ofincreases in the interest rates on half of its floating rate term debt. Underthe swap agreements, which expire May 31, 2003 to June 30, 2003, aLIBOR-equivalent interest rate component of the interest rate is limited to5.875% on half of the Company’s $27.9 million term loans.  If interest rates moved 100 basis points,the effect on income before income taxes would be $279,000 annually.

 

We do not enterinto interest rate transactions for speculative purposes.

 

###### **ITEM4.  CONTROLS AND PROCEDURES**

 

**Evaluationof disclosure controls and procedures**

 

Within the 90 daysprior to the date of this report, we carried out an evaluation of theeffectiveness of the design and operation of the our “disclosure controls andprocedures”, as defined in the Securities Exchange Act of 1934 (“Exchange Act”)Rules 13a-14(c) and 15d-14(c), under the supervision and with the participationof our management, including our Chief Executive Officer and Vice President ofFinance. Based upon that evaluation, our Chief Executive Officer and VicePresident of Finance concluded that our disclosure controls and procedures areeffective.

 

Disclosurecontrols and procedures are controls and other procedures that are designed toensure that information required to be disclosed in Company reports filed orsubmitted under the Exchange Act is recorded, processed, summarized andreported, within the time periods specified in the Securities and ExchangeCommission’s rules and forms. Disclosure controls and procedures include,without limitation, controls and procedures designed to ensure that informationrequired to be disclosed in our reports filed under the Securities and ExchangeAct is accumulated and communicated to management to allow timely decisionsregarding required disclosure.

 

**Changesin internal controls**

 

We seek tomaintain a system of internal accounting controls that are intended to providereasonable assurances that our books and records accurately reflect ourtransactions and that our established policies and procedures arefollowed.  There were no significantchanges in our internal controls or, to our knowledge, in other factors thatcould significantly affect our disclosure controls and procedures subsequent tothe date we carried out this evaluation.

 

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**PART II — OTHER INFORMATION**

 

**ITEM 1.  LEGAL PROCEEDINGS**

 

On May 1,2000, Worthington Industries, Inc. (Worthington) filed suit (in the UnitedStates District Court for the Southern District of Ohio, Eastern Division)against us and Morton Custom Plastics, LLC (“MCP, LLC”) related to MCP, LLC’s1999 acquisition of the non-automotive plastics business from Worthington.Worthington claimed that it was owed additional amounts under the saleagreement and a related service agreement, and that it was owed dividends onshares of our preferred stock that it received. We believed that under theterms of the agreement, none of the amounts claimed by Worthington were owed byus.  The case has been stayed because ofthe bankruptcy of MCP, LLC, although Worthington may attempt to continue thelitigation against us on the dividend matter.

 

**ITEM 2.  CHANGES IN SECURITIES**

 

On September 20,2000, the Company issued warrants to purchase 238,548 shares of its Class ACommon Stock at an exercise price of $.01 per share.  Under the terms of the February, 2003 amendment with Harris Bank,the warrants may be exercised at any time through December 31, 2005.

 

**ITEM6.  EXHIBITS AND REPORTS ON FORM 8-K**

 
| (A)    |   | Exhibits |   |                                                                                                          |
|--------|--------|----------|--------|---------------------------------------------------------------------------------------------------------------|
|   |   |     |   |                                                                                                          |
|   |   | 11.      |   | The computation can be determined from this report.                                                           |
|   |   | 99.1     |   | Certification pursuant to 18 U.S.C. Section 1350,  pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|   |   | 99.2     |   | Certification pursuant to 18 U.S.C. Section 1350,  pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |

 
| (B)    |   | Reports on Form 8-K.                                                                                         |
|--------|--------|--------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                         |
|   |   | Form 8-K filed on February 5, 2003 announcing  personnel changes.                                            |
|   |   | Form 8-K filed on April 3, 2003 announcing the  earnings press release for the year ended December 31, 2002. |

 

**SIGNATURES**

 

Pursuant to therequirements of the Securities Exchange Act of 1934, the Registrant has dulycaused this report to be signed on its behalf by the undersigned thereunto dulyauthorized.

 
|                | MORTON INDUSTRIAL GROUP, INC. |                         |
|---------------------|-------------------------------|------------------------------|
|                |                          |
|                | By:                           | /s/ RODNEY B. HARRISON       |   |
|                |                          |                         |
|                |                          | Rodney B. Harrison           |
|                |                          | *Vice  President of Finance* |
|                |                          |                         |
| Dated: May 13, 2003 |                          |                         |
|                     |                               |                              |  |

 

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I, William D. Morton, as Chairman and Chief Executive Officer of MortonIndustrial Group, Inc., certify that:

 

1.               I have reviewedthis quarterly report on Form 10-Q of Morton Industrial Group, Inc.;

 

2.               Based on myknowledge, this quarterly report does not contain any untrue statement of amaterial fact or omit to state a material fact necessary to make the statementsmade, in light of the circumstances under which such statements were made, notmisleading with respect to the period covered by this quarterly report;

 

3.               Based on myknowledge, the financial statements, and other financial information includedin this quarterly report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, andfor, the periods presented in this quarterly report.

 

4.               The registrant’sother certifying officer and I are responsible for establishing and maintainingdisclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and15d-14) for the registrant and we have:

 

a)              designed suchdisclosure controls and procedures to ensure that material information relatingto the registrant, including its consolidated subsidiaries, is made known to usby others within those entities, particularly during the period in which thisquarterly report is being prepared;

 

b)             evaluated theeffectiveness of the registrant’s disclosure controls and procedures as of adate within 90 days prior to the filing date of this quarterly report (the“Evaluation Date”); and

 

c)              presented in thisquarterly report our conclusions about the effectiveness of the disclosurecontrols and procedures based on our evaluation as of the Evaluation Date;

 

5.               The registrant’s othercertifying officer and I have disclosed, based on our most recent evaluation,to the registrant’s auditors and the audit committee of the registrant’s boardof directors:

 

a)              all significantdeficiencies in the design or operation of internal controls which couldadversely affect the registrant’s ability to record, process, summarize andreport financial data and have identified for the registrant’s auditors anymaterial weaknesses in internal controls; and

 

b)             any fraud, whether ornot material, that involves management or other employees who have asignificant role in the registrant’s internal controls; and

 

6.               The registrant’sother certifying officer and I have indicated in this quarterly report whetheror not there were significant changes in internal controls or in other factorsthat could significantly affect internal controls subsequent to the date of ourmost recent evaluation, including any corrective actions with regard tosignificant deficiencies and material weaknesses.

 
| / s / William D. Morton              |   |
|--------------------------------------|--------|
|                                 |
| William D. Morton                    |
| Chairman and Chief Executive Officer |
| May 13, 2003                         |

 

 

I, Rodney B. Harrison, as Vice President of Finance of MortonIndustrial Group, Inc., certify that:

 

1.               I have reviewedthis quarterly report on Form 10-Q of Morton Industrial Group, Inc.;

 

2.               Based on myknowledge, this quarterly report does not contain any untrue statement of amaterial fact or omit to state a material fact necessary to make the statementsmade, in light of the circumstances under which such statements were made, notmisleading with respect to the period covered by this quarterly report;

 

3.               Based on myknowledge, the financial statements, and other financial information includedin this quarterly report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, andfor, the periods presented in this quarterly report.

 

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4.               The registrant’sother certifying officer and I are responsible for establishing and maintainingdisclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and15d-14) for the registrant and we have:

 

a)              designed suchdisclosure controls and procedures to ensure that material information relatingto the registrant, including its consolidated subsidiaries, is made known to usby others within those entities, particularly during the period in which thisquarterly report is being prepared;

 

b)             evaluated theeffectiveness of the registrant’s disclosure controls and procedures as of adate within 90 days prior to the filing date of this quarterly report (the“Evaluation Date”); and

 

c)              presented in thisquarterly report our conclusions about the effectiveness of the disclosurecontrols and procedures based on our evaluation as of the Evaluation Date;

 

5.               The registrant’sother certifying officer and I have disclosed, based on our most recentevaluation, to the registrant’s auditors and the audit committee of theregistrant’s board of directors:

 

a)              all significant deficienciesin the design or operation of internal controls which could adversely affectthe registrant’s ability to record, process, summarize and report financialdata and have identified for the registrant’s auditors any material weaknessesin internal controls; and

 

b)             any fraud, whether ornot material, that involves management or other employees who have asignificant role in the registrant’s internal controls; and

 

6.               The registrant’sother certifying officer and I have indicated in this quarterly report whetheror not there were significant changes in internal controls or in other factorsthat could significantly affect internal controls subsequent to the date of ourmost recent evaluation, including any corrective actions with regard tosignificant deficiencies and material weaknesses.

 
| / s / Rodney B. Harrison  |   |
|---------------------------|--------|
|                      |
| Rodney B. Harrison        |
| Vice President of Finance |
| May 13, 2003              |

 

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