SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. - 20549
_________________________
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Quarterly Period Ended June 28, 2002
Commission File No. 0-12588
_________________________
SALIENT 3 COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)
Delaware 23-2280922
(State of Incorporation) (IRS Employer
Identification No.)
P.O. Box 1498, Reading, Pennsylvania 19603
(Mailing address of principal executive offices) (Zip Code)
(610) 856-5500
_________________________________________________________________________
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
Class A Class B
------- -------
Number of shares of each class of
common stock outstanding as of
June 28, 2002 (excluding 2,770,476
Class A treasury shares): 5,953,011 261,813
--------- -------
SALIENT 3 COMMUNICATIONS, INC.
INDEX
Part I. Financial Information Pages
Item 1.
Statements of Net Assets in Liquidation
at June 28, 2002 (unaudited) and December 28, 2001
Statements of Changes in Net Assets in Liquidation
for the six months ended June 28, 2002
and June 29, 2001 (unaudited)
Notes to Financial Statements
Item 2.
Management's Discussion and Analysis of Results of
Operations and Financial Condition
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K
Signatures
Part I. Financial Information
Salient 3 Communications, Inc.
Statements of Net Assets in Liquidation
June 28, 2002 (Unaudited) and December 28, 2001
(000's except for share and per share information)
June 28, December 28,
2002 2001
-------- ------------
ASSETS
Cash and cash equivalents $ 11,941 $ 12,800
Investments in liquidation 5,469 5,862
Income tax refunds receivable - 140
Other assets 2,277 2,784
------ ------
Total Assets 19,687 21,586
------ ------
LIABILITIES
Accrued and other liabilities $ 10,207 $ 12,602
Income taxes 55 -
------ ------
10,262 12,602
------ ------
Net assets in liquidation $ 9,425 $ 8,984
===== =====
Number of common shares outstanding 6,214,824 6,214,824
========= =========
Net assets in liquidation
per outstanding share $ 1.52 $ 1.45
==== ====
The accompanying notes are an integral part of these financial statements.
Salient 3 Communications, Inc.
Statements of Changes In Net Assets In Liquidation
Six Months Ended June 28, 2002 and June 29, 2001
(Unaudited)
(000's)
Six Months Six Months
Ended Ended
June 28, 2002 June 29, 2001
------------- -------------
Net assets in liquidation, beginning of period $ 8,984 $ 20,780
----- ------
Changes in estimated liquidation values
of assets and liabilities:
Investments in liquidation (350) (607)
Other assets 512 442
Accrued and other liabilities 490 (405)
Income taxes (211) 656
----- ------
Net changes in estimated liquidation values 441 86
----- ------
Liquidating distribution to stockholders - -
----- ------
Net assets in liquidation, end of period $ 9,425 $ 20,866
===== ======
Supplemental Cash Information:
Changes in cash and cash equivalents
Net proceeds (payments) related to
sales of subsidiaries 43 (925)
Cash receipts for other assets 1,019 604
Payment (refund) of income taxes (16) 5
Payment of accrued liabilities (1,905) (6,474)
----- ------
Net changes in cash and cash equivalents $ (859) $ (6,790)
===== ======
The accompanying notes are an integral part of these financial statements.
SALIENT 3 COMMUNICATIONS, INC
NOTES TO FINANCIAL STATEMENTS
JUNE 28, 2002
(UNAUDITED)
(000's except for share and per share information)
1. GENERAL
The interim financial information furnished herein reflects all adjustments
which are, in the opinion of management, necessary for a fair presentation of
such financial information for the interim periods. Such adjustments are of a
normal recurring nature. The accompanying financial statements are presented
in accordance with the requirements of Form 10-Q and consequently do not
include all of the disclosures normally required by generally accepted
accounting principles or those normally made in the Company's annual Form 10-K
filing. Accordingly, the reader of this Form 10-Q should refer to the
Company's annual report on Form 10-K for the year ended December 28, 2001 for
further information.
2. PLAN OF DISSOLUTION AND LIQUIDATION AND BASIS OF ACCOUNTING
On April 17, 2000, the Board of Directors of Salient 3 Communications, Inc.
(the Company) adopted a Plan of Dissolution and Liquidation (the Plan). Under
the Plan, the Company will be liquidated by (i) the sale of its non-cash
assets, (ii) the payment of or providing for all of its claims, obligations
and expenses, (iii) the pro rata distribution of assets, primarily cash, to
the stockholders, and (iv) if required, the distribution of assets to one or
more liquidating trusts established for the benefit of the stockholders. The
Plan was approved by stockholders on July 21, 2000.
On August 11, 2000, the Company filed a Certificate of Dissolution with the
State of Delaware. Under Delaware law, the Company will continue to exist for
a period of three years for the purpose of winding up its affairs. The Board
of Directors and officers of the Company will continue to oversee the
liquidation and dissolution.
Prior to June 30, 2000, seven stockholders, who together control more than 51%
of the issued and outstanding Class B common stock, had agreed to vote their
shares in favor of the Plan and in favor of the sales of SAFCO Technologies,
Inc. (SAFCO) and GAI-Tronics Corporation (GTC). As a result, the Company
adopted the liquidation basis of accounting for the second quarter of 2000.
Under the liquidation basis of accounting, assets are stated at their
estimated net realizable values and liabilities are stated at their
anticipated settlement amounts.
The valuation of assets and liabilities at their estimated net realizable
values and anticipated settlement amounts necessarily requires many estimates
and assumptions and there are substantial uncertainties in carrying out the
provisions of the Plan. The actual value of any liquidating distributions
will depend upon a variety of factors including, but not limited to, (i) the
actual proceeds from the sale of the Company's subsidiaries and other assets,
(ii) the ultimate settlement amounts of its liabilities and obligations,
including indemnifications provided in connection with subsidiary sale
transactions, (iii) actual costs incurred in connection with carrying out the
Plan, including administrative costs during the liquidation period, and (iv)
the actual timing of distributions. An initial liquidating distribution of
$12.00 per share was paid on September 8, 2000. An additional liquidating
distribution of $2.00 per share was paid on December 14, 2001.
The valuations presented in the Statements of Net Assets in Liquidation
represent estimates, based on present facts and circumstances, of the net
realizable values of assets and the anticipated settlement amounts for
liabilities, including the costs associated with carrying out the provisions
of the Plan, based on the assumptions set forth in the accompanying notes.
The actual values and costs are expected to differ from the amounts shown
herein and could be higher or lower than the amounts recorded. Such
differences may be material. Accordingly, it is not possible to predict with
certainty the aggregate net values ultimately distributable to stockholders
and no assurance can be given that the amount to be received in liquidation
will equal or exceed the price or prices at which the Class A common stock has
generally traded or is expected to trade in the future.
In the Statements of Changes in Net Assets in Liquidation, the amounts
reported for changes in estimated liquidation values of assets and liabilities
represent (i) differences between actual and estimated proceeds on the sales
of assets, (ii) differences between actual and estimated settlements made on
outstanding obligations, and (iii) changes in management estimates of values
for unsold assets and outstanding liabilities.
3. INVESTMENTS IN LIQUIDATION
Investments in liquidation include the estimated net realizable values of
subsidiary sale proceeds collectible after June 28, 2002 and December 28,
2001, less related unpaid costs of the sales, and the estimated net realizable
value of the building occupied by XEL Communications, Inc. (XEL).
On July 25, 2000, the Company completed the sale of SAFCO to Agilent
Technologies, Inc. (Agilent) for $121,426 in cash, after consideration of
certain closing balance sheet adjustments. The purchase price included
$11,000 which was placed into escrow for certain expenses and possible
indemnification claims under the representations and warranties sections of
the purchase agreement. During the fourth quarter of 2001, $443 was disbursed
from the escrow account to cover expenses owed by the Company, $334 was
disbursed to pay indemnification claims and $9,388 was distributed to the
Company. Each of these disbursements included a share of interest earned by
the account. A balance of $1,500 was retained in the escrow account to cover
a potential obligation of the Company that was not finalized with Agilent at
June 28, 2002. Management estimates that this obligation, including
settlement costs, will be settled for approximately $300.
On July 26, 2000, the Company completed the sale of GTC to Hubbell
Incorporated (Hubbell) for cash of $36,246, after consideration of certain
closing balance sheet adjustments. During the third quarter of 2001, Hubbell
submitted notification of an indemnification claim under the representations
and warranties sections of the purchase agreement. As of June 28, 2002, it is
not possible to predict the ultimate liability of the Company in connection
with this indemnification claim. The Company believes that this claim, when
resolved, will not have a material effect on the net assets in liquidation.
The Company has purchased certain insurance to minimize its exposure on some,
but not all, of the areas for which they are indemnifying Hubbell.
On December 29, 2000, the Company completed the sale of XEL Communications,
Inc. (XEL) to a company controlled by XEL's president for $4,900, in the form
of a promissory note bearing interest payable monthly at 8%, with the
principal due after 24 months. In connection with the sale, the Company
loaned XEL $359 under a working capital line of credit that expired on March
31, 2001. The working capital loan, plus interest at 5% per annum, was due
December 29, 2002. If XEL was resold to another party prior to December 30,
2002, the Company would receive full payment on the promissory note and
working capital loan and 70% of all proceeds in excess of $5,000. If XEL was
resold after December 29, 2002 but prior to December 30, 2003, the Company
would receive 50% of all proceeds in excess of $5,000. If there is a default
in payment of the principal or interest on the promissory note, the Company
has the right to retake control of XEL. The sale of XEL excluded the
building it occupies in Aurora, Colorado. The Company is attempting to sell
this building to an unrelated third party.
Effective April 1, 2002, the Company entered into an amendment agreement with
the buyer of XEL to modify the promissory note and working capital loan held
in connection with the sale of XEL. The modified note and loan have reduced
principal amounts aggregating $1,900. The amendment agreement provides for 15
monthly payments of $102, including interest of 8%, with a balloon payment for
the balance outstanding at July 31, 2003. If XEL is resold prior to December
28, 2003, the Company would receive 50% of all proceeds in excess of $1,900.
The amendment agreement allows the Company to begin receiving monthly payments
on the principal balance and to obtain a tax benefit in 2002 for the reduction
in face value of the note. The reported value of the amended note in the
Statements of Net Assets in Liquidation at June 28, 2002 is net of a valuation
reserve of $500 based on the estimated realization values of XEL's net assets.
4. INCOME TAXES
All income tax accounts reflect the liquidation basis of accounting. The
estimated amounts of income tax liabilities and income tax refunds receivable
reflect federal and state income taxes, at statutory rates, which would become
payable or refundable if the assets are realized and liabilities settled at
the amounts shown, net of amounts accrued for potential liabilities for
adjustments of transactions reported on prior year tax returns. The estimated
tax refund at December 28, 2001 primarily results from anticipated carrybacks
of tax losses that arise from tax deductible costs of carrying out the plan of
liquidation and settling other accrued liabilities. The estimate is subject
to significant variation if, among other things, the actual values of assets
sold vary from current estimates, the amounts or timing of settlement of
liabilities differ from current estimates, or there are potential adjustments
related to the sales and other transactions.
5. ACCRUED AND OTHER LIABILITIES
Accrued and other liabilities include estimates of costs to be incurred in
carrying out the Plan, provisions for known liabilities and provisions for
certain claims at June 28, 2002. The accrued costs include salaries and
related expenses of officers and employees assigned to effect the sales and
carry out the Plan and legal and accounting fees expected to be incurred
during the period of liquidation. Accrued liabilities also include the
estimated future distributions to holders of limited stock appreciation
rights.
The actual costs incurred could vary significantly from the related accrued
expenses due to uncertainty related to the length of time required to complete
the Plan and the outcome of certain contingencies.
6. OPTIONS AND WARRANTS
In April 2000, the Board of Directors authorized immediate vesting of all
outstanding restricted stock, and, effective with the first subsidiary sale,
vesting of stock options granted under the 1989 Stock Option Plan and the 1996
Long Term Incentive Plan and extension of the exercise period to the record
date of the initial liquidating distribution. The Board also added a
provision to convert all unexercised options at the record date of the initial
liquidating distribution into Limited Stock Appreciation Rights (LSAR's). In
addition, all warrant holders were given the opportunity to convert their
warrants into LSAR's. These rights entitle the holder to receive cash
payments for each share equal to the difference between the aggregate per
share liquidating distribution payable to stockholders upon liquidation and
the per share exercise price applicable to each converted option or warrant.
In August, 2000, 1,097,200 options and 705,555 warrants were converted into
LSAR's. Holders of LSAR's were paid $1,866 in connection with the initial
liquidating distribution on September 8, 2000 and $1,639 in connection with
the additional liquidating distribution on December 14, 2001. The estimated
remaining liability for settlement of the LSAR's at June 28, 2002 is $1,603
and is included in accrued and other liabilities in the Statements of Net
Assets in Liquidation.
7. CONTINGENCIES
The Company was named a defendant in a complaint filed in Delaware Chancery
Court on August 29, 2000, and amended on February 26, 2001, by a group of
former employees and current Class A stockholders, challenging the
compensation packages granted by the Company to its senior management in
connection with the dissolution of the Company. On November 1, 2001, the
Delaware Chancery Court granted the Company's motion to dismiss the complaint.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
(000's except for share and per share information)
Introduction
On April 17, 2000, the Company's Board of Directors adopted a Plan of
Dissolution and Liquidation ("the Plan"). Under the Plan, the Company will be
liquidated by (i) the sale of its non-cash assets, (ii) the payment of or
providing for all of its claims, obligations and expenses, (iii) the pro rata
distribution of assets, primarily cash, to the stockholders, and (iv) if
required, the distribution of assets to one or more liquidating trusts
established for the benefit of the stockholders. The Plan was approved by
stockholders on July 21, 2000.
On August 11, 2000, the Company filed a Certificate of Dissolution with the
State of Delaware. Under Delaware law, the Company will continue to exist for
a period of three years for the purpose of winding up its affairs. The Board
of Directors and officers of the Company will continue to oversee the
liquidation and dissolution.
The Company adopted the liquidation basis of accounting for the second quarter
of 2000. Under the liquidation basis of accounting, assets are stated at
their estimated net realizable values and liabilities are stated at their
anticipated settlement amounts.
The valuation of assets and liabilities at their estimated net realizable
values and anticipated settlement amounts necessarily requires many estimates
and assumptions and there are substantial uncertainties in carrying out the
provisions of the Plan. The actual value of any liquidating distributions
will depend upon a variety of factors including, but not limited to, (i) the
actual proceeds from the sale of the Company's subsidiaries and other assets,
(ii) the ultimate settlement amounts of its liabilities and obligations,
including indemnifications provided in connection with subsidiary sale
transactions, (iii) actual costs incurred in connection with carrying out the
Plan, including administrative costs during the liquidation period, and (iv)
the actual timing of distributions. An initial liquidating distribution of
$12.00 per share was paid on September 8, 2000 to holders of Class A (non-
voting) and Class B (voting) common stock. An additional liquidating
distribution of $2.00 per share was paid on December 14, 2001.
Sale of Assets
On July 25, 2000, the Company completed the sale of SAFCO to Agilent
Technologies, Inc. (Agilent) for $121,426 in cash, after consideration of
certain closing balance sheet adjustments. The purchase price included
$11,000 which was placed into escrow for certain expenses and possible
indemnification claims under the representations and warranties sections of
the purchase agreement. During the fourth quarter of 2001, $443 was disbursed
from the escrow account to cover expenses owed by the Company, $334 was
disbursed to pay indemnification claims and $9,388 was distributed to the
Company. Each of these disbursements included a share of interest earned by
the account. A balance of $1,500 was retained in the escrow account to cover
a potential obligation that was not finalized with Agilent at June 28, 2002.
Management estimates that this obligation, including settlement costs, will be
settled for approximately $300.
On July 26, 2000, the Company completed the sale of GTC to Hubbell
Incorporated (Hubbell) for cash of $36,246, after consideration of certain
closing balance sheet adjustments. During the third quarter of 2001, Hubbell
submitted notification of an indemnification claim under the representations
and warranties sections of the purchase agreement. As of June 28, 2002, it is
not possible to predict the ultimate liability of the Company in connection
with this indemnification claim. The Company believes that this claim, when
resolved, will not have a material effect on the net assets in liquidation.
The Company has purchased certain insurance to minimize its exposure on some,
but not all, of the areas for which they are indemnifying Hubbell.
On December 29, 2000, the Company completed the sale of XEL Communications,
Inc. (XEL) to a company controlled by XEL's president for $4,900, in the form
of a promissory note bearing interest payable monthly at 8%, with the
principal due after 24 months. In connection with the sale, the Company
loaned XEL $359 under a working capital line of credit that expired on March
31, 2001. The working capital loan, plus interest at 5% per annum, was due
December 29, 2002. If XEL was resold to another party prior to December 30,
2002, the Company would receive full payment on the note and working capital
loan and 70% of all proceeds in excess of $5,000. If XEL was resold after
December 29, 2002 but prior to December 30, 2003, the Company would receive
50% of all proceeds in excess of $5,000. If there is a default in payment of
the principal or interest on the promissory note, the Company has the right to
retake control of XEL. The sale of XEL excluded the building it occupies in
Aurora, Colorado. The Company is attempting to sell this building to an
unrelated third party.
Effective April 1, 2002, the Company entered into an amendment agreement with
the buyer of XEL to modify the promissory note and working capital loan held
in connection with the sale of XEL. The modified note and loan have reduced
principal amounts aggregating $1,900. The amendment agreement provides for 15
monthly payments of $102, including interest of 8%, with a balloon payment for
the balance outstanding at July 31, 2003. If XEL is resold prior to December
28, 2003, the Company would receive 50% of all proceeds in excess of $1,900.
The amendment agreement allows the Company to begin receiving monthly payments
on the principal balance and to obtain a tax benefit in 2002 for the reduction
in face value of the note. The reported value of the amended note in the
Statements of Net Assets in Liquidation at June 28, 2002 is net of a valuation
reserve of $500 based on the estimated realization values of XEL's net assets.
On April 3, 2002, the Company completed the sale of its undeveloped land near
Reading, PA for $651 in cash. The estimated value of the land was included in
other assets in the Statements of Net Assets in Liquidation for periods prior
to the sale.
Financial Condition
Pursuant to the Plan, after payment or provision for payment of the Company's
indebtedness and other obligations, the cash proceeds of any asset sales,
together with other available cash, will be distributed from time to time pro
rata to the holders of the common stock. The record dates with respect to
each distribution will be selected by the Board of Directors. An initial
liquidating distribution of $74,582 or $12.00 per share was paid on September
8, 2000. An additional liquidating distribution of $12,430 or $2.00 per share
was paid on December 14, 2001.
Before distributing assets to its stockholders, the Company is required by
Delaware law to make provision for all known claims and obligations and any
unasserted claims that are reasonably likely to arise after the certificate of
dissolution became effective. The accrual for asserted claims included in
accrued and other liabilities represents management's judgment as to the
estimated amounts required to settle such claims, should they arise and should
they have merit. Ultimate settlement amounts for such claims are expected to
differ from estimates recorded as of June 28, 2002. Accordingly, it is not
possible to predict with certainty the amount required for such claims.
The reported value of net assets in liquidation is subject to adjustment as
estimated values of assets and liabilities are reevaluated each period and as
assets are sold or liabilities are settled for amounts different from
estimates reported in previous periods.
Liquidity and Capital Resources
On June 28, 2002, the Company had cash and cash equivalents of $11,941. The
future cash needs of the Company will be dependent on the continuing
implementation of the Plan. The Company believes that its cash and cash
equivalents, its collection of deferred payments on sales of subsidiaries and
its conversion of other assets to cash will be sufficient to fund its working
capital requirements through the completion of the Plan.
The Company estimates that its total capital expenditures during the
liquidation period will be insignificant.
Other
In April 2000, the Board of Directors authorized immediate vesting of all
outstanding restricted stock, and, effective with the first subsidiary sale,
vesting of stock options granted under the 1989 Stock Option Plan and the 1996
Long Term Incentive Plan and extension of the exercise period to the record
date of the initial liquidating dividend. The Board also added a provision to
convert all unexercised options at the record date of the initial liquidating
dividend into Limited Stock Appreciation Rights. These rights entitle the
holder to receive cash payments for each share equal to the difference between
the aggregate per share liquidating distribution payable to stockholders upon
liquidation and the per share exercise price applicable to each converted
option. In August, 2000, 1,097,200 options and 705,555 warrants were
converted into LSAR's. Holders of LSAR's were paid $1,866 in connection with
the initial liquidating distribution on September 8, 2000 and $1,639 in
connection with the additional liquidating distribution on December 14, 2001.
The estimated remaining liability for settlement of the LSAR's at June 28,
2002 is $1,603 and is included in accrued and other liabilities in the
Statements of Net Assets in Liquidation.
FORWARD-LOOKING STATEMENTS
This Form 10-Q contains certain statements of a forward-looking nature
relating to future events or the future financial performance of the Company,
including statements regarding the timing and outcome of the sale of the
Company's assets, its dissolution and liquidation and the expected
distributions therefrom. Such statements are only predictions and involve
risks and uncertainties, and actual events or performance may differ
materially from that expressed in any such forward-looking statements.
Potential risks and uncertainties include, without limitation: ultimate values
realizable for unsold assets, adjustments to subsidiary sale prices,
collection of deferred payments on sales of assets, post-closing
indemnification obligations relating to subsidiary sales, costs and expenses
relating to the dissolution, including income taxes, and the nature and amount
of any unknown contingent liabilities. Further information on factors that
could affect the Company's future financial performance can be found in the
Company's other filings with the Securities and Exchange Commission. Words
such as "estimates", "positioned", "yields", "should generate", "appears",
"viewed", "could", "would position", "expected", "does not expect" and "should
allow" indicate the presence of forward-looking statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Company's only financial instruments with market risk exposure are short-
term cash investments which total $11,846 at June 28, 2002. Based on this
balance, a change of one percent in the interest rate would cause a change in
interest income for the year of approximately $118. This interest amount,
less a related tax effect, would have no effect on the net assets in
liquidation per outstanding share since interest income on cash investments is
not accrued in the Statements of Net Assets in Liquidation.
These financial instruments are non-trading (not entered into for trading
purposes) and carry interest at a market rate. The Company's objective in
maintaining these variable rate investments is the flexibility obtained in
having cash available for payment of accrued liabilities and distributions to
stockholders without penalties.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
99.1 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-
OXLEY ACT OF 2002
99.2 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-
OXLEY ACT OF 2002
(b) Reports on Form 8-K
The Company filed Form 8-K on June 14, 2002 to report the
dismissal of Arthur Andersen LLP and the engagement of KPMG
LLP as the Company's independent public accountants for
fiscal 2002.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Salient 3 Communications, Inc.
/s/Paul H. Snyder
--------------------
Paul H. Snyder
Senior Vice President and
Chief Financial Officer
Date: August 9, 2002
Exhibit 99.1
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Salient 3 Communications, Inc.
(the "Company") on Form 10-Q for the period ending June 28, 2002 as filed
with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Timothy S. Cobb, the Chief Executive Officer of the Company,
certify, pursuant to 18 U.S.C. SS 1350, as adopted pursuant to SS 906 of the
Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company. *
/s/ Timothy S. Cobb
- -----------------------
Timothy S. Cobb
Chief Executive Officer
August 9, 2002
* In lieu of an income statement and balance sheet, the Company's Form 10-Q
includes a statement of net assets in liquidation and a statement of changes
in net assets in liquidation. The certifications made herein should be
construed accordingly.
Exhibit 99.2
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Salient 3 Communications, Inc.
(the "Company") on Form 10-Q for the period ending June 28, 2002 as filed
with the Securities and Exchange Commission on the date hereof (the
"Report"), I, Paul H. Snyder, the Chief Financial Officer of the Company,
certify, pursuant to 18 U.S.C. SS 1350, as adopted pursuant to SS 906 of the
Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company. *
/s/Paul H. Snyder
- -----------------------
Paul H. Snyder
Chief Financial Officer
August 9, 2002
* In lieu of an income statement and balance sheet, the Company's Form 10-Q
includes a statement of net assets in liquidation and a statement of changes
in net assets in liquidation. The certifications made herein should be
construed accordingly.