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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-------
FORM 10-Q
(MARK ONE)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2004
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
Commission file number 033-71690
FIRST FORTIS LIFE INSURANCE COMPANY
(Exact name of registrant as specified in its charter)
NEW YORK 13-2699219
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
308 MALTBIE STREET, SUITE 200
SYRACUSE, NEW YORK 13204
(Address of Principal Executive Offices) (Zip Code)
(315) 451-0066
(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
--- ---
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2).
Yes No X
--- ---
The number of shares of the registrant's Common Stock outstanding at
April 30, 2004 was 100,000, all of which are owned directly by Assurant, Inc.
THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION
H(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH REDUCED
DISCLOSURE FORMAT.
FIRST FORTIS LIFE INSURANCE COMPANY
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2004
TABLE OF CONTENTS
ITEM PAGE
NUMBER NUMBER
- ------ ------
PART I
FINANCIAL INFORMATION
1. FINANCIAL STATEMENTS .................................................................... 2
Unaudited interim balance sheets of First Fortis Life Insurance Company at March 31, 2004
and December 31, 2003 ................................................................... 2
Unaudited interim statements of operations of First Fortis Life Insurance Company for the
three months ended March 31, 2004 and 2003 .............................................. 4
Unaudited interim statements of changes in stockholder's equity of First Fortis Life
Insurance Company for the three months ended March 31, 2004 ............................. 5
Unaudited interim statement of cash flows of First Fortis Life Insurance Company for the
three months ended March 31, 2004 and 2003 .............................................. 6
Notes to the unaudited financial statements of First Fortis Life Insurance Company ...... 7
2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS .............................................................................. 9
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK * ............................ 11
4. CONTROLS AND PROCEDURES ................................................................. 11
PART II
OTHER INFORMATION
1. LEGAL PROCEEDINGS ....................................................................... 11
2. CHANGES IN SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASES OF EQUITY SECURITIES * ...... 11
3. DEFAULTS UPON SENIOR SECURITIES * ....................................................... 11
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS * ................................... 11
5. OTHER INFORMATION ....................................................................... 12
6. EXHIBITS AND REPORTS ON FORM 8-K ........................................................ 12
SIGNATURES ................................................................................. 13
* NOT REQUIRED UNDER REDUCED DISCLOSURE PURSUANT TO GENERAL INSTRUCTION H(1) (A)
AND (B) OF FORM 10Q.
1
FIRST FORTIS LIFE INSURANCE COMPANY
BALANCE SHEETS
AT MARCH 31, 2004 (UNAUDITED) AND DECEMBER 31, 2003
MARCH 31, DECEMBER 31,
2004 2003
-------- --------
(IN THOUSANDS)
ASSETS
Investments:
Fixed maturities available for sale, at fair value
(amortized cost- $150,186 in 2004 and $157,032 in 2003) $163,442 $167,712
Equity securities available for sale, at fair value
(cost- $11,036 in 2004 and $9,574 in 2003) 11,419 9,784
Commercial mortgage loans on real estate
at amortized cost 3,784 3,800
Policy loans 37 37
Short-term investments 6,389 8,091
Other investments 246 275
-------- --------
Total investments 185,317 189,699
Cash and cash equivalents 4,413 1,060
Premiums and accounts receivable 4,844 2,777
Reinsurance recoverables 99,968 100,451
Accrued investment income 2,281 2,185
Deferred acquisition costs 977 942
Deferred income taxes, net 1,558 3,040
Goodwill 2,038 2,038
Other assets 92 82
Assets held in separate accounts 33,541 39,678
-------- --------
Total assets $335,029 $341,952
======== ========
2
See the accompanying notes to the financial statements
FIRST FORTIS LIFE INSURANCE COMPANY
BALANCE SHEETS
AT MARCH 31, 2004 (UNAUDITED) AND DECEMBER 31, 2003
MARCH 31, DECEMBER 31,
2004 2003
-------- --------
(IN THOUSANDS)
LIABILITIES
Future policy benefits and expenses $ 25,537 $ 24,143
Unearned premiums 32,373 35,798
Claims and benefits payable 135,037 137,233
Commissions payable 3,857 3,811
Reinsurance balances payable 1,694 1,935
Funds held under reinsurance 86 94
Deferred gain on disposal of businesses 7,669 8,067
Due to affiliates 39 2,407
Accounts payable and other liabilities 5,123 6,264
Income tax payable 3,458 1,771
Liabilities related to separate accounts 33,541 39,678
-------- --------
Total liabilities 248,414 261,201
STOCKHOLDER'S EQUITY
Common stock, $20 par value: authorized,
issued and outstanding shares - 100,000 2,000 2,000
Additional paid-in capital 43,006 43,006
Retained earnings 32,739 28,663
Accumulated other comprehensive income 8,870 7,082
-------- --------
Total stockholder's equity 86,615 80,751
-------- --------
Total liabilities and stockholder's equity $335,029 $341,952
======== ========
3
See the accompanying notes to the financial statements
FIRST FORTIS LIFE INSURANCE COMPANY
STATEMENTS OF OPERATIONS (UNAUDITED)
THREE MONTHS ENDED MARCH 31, 2004 AND 2003
THREE MONTHS ENDED MARCH 31,
----------------------------
2004 2003
-------- --------
(IN THOUSANDS)
REVENUES
Net earned premiums and other considerations $ 15,692 $ 17,432
Net investment income 2,677 2,580
Net realized gain (loss) on investments 215 (55)
Amortization of deferred gain on disposal
of businesses 398 481
Fees and other income 67 87
-------- --------
Total revenues 19,049 20,525
BENEFITS, LOSSES AND EXPENSES
Policyholder benefits 8,069 10,114
Amortization of deferred acquisition costs 180 4
Underwriting, general and administrative
expenses 4,517 6,368
-------- --------
Total benefits, losses and expenses 12,766 16,486
-------- --------
Income before income taxes 6,283 4,039
Income taxes 2,207 1,414
-------- --------
Net income $ 4,076 $ 2,625
======== ========
4
See the accompanying notes to the financial statements
FIRST FORTIS LIFE INSURANCE COMPANY
STATEMENTS OF CHANGES IN STOCKHOLDER'S EQUITY
FROM DECEMBER 31, 2003 THROUGH MARCH 31, 2004 (UNAUDITED)
ACCUMULATED
ADDITIONAL OTHER
COMMON PAID-IN RETAINED COMPREHENSIVE
STOCK CAPITAL EARNINGS INCOME (LOSS) TOTAL
----- ------- -------- ------------- -----
(IN THOUSANDS)
Balance, December 1, 2003 $ 2,000 $43,006 $28,663 $ 7,082 $80,751
Comprehensive income:
Net income -- -- 4,076 -- 4,076
Net change in unrealized
gains on securities -- -- -- 1,788 1,788
-------
Total comprehensive income 5,864
------- ------- ------- ------- -------
Balance, March 31, 2004 $ 2,000 $43,006 $32,739 $ 8,870 $86,615
======= ======= ======= ======= =======
5
See the accompanying notes to the financial statements
FIRST FORTIS LIFE INSURANCE COMPANY
STATEMENTS OF CASH FLOWS (UNAUDITED)
THREE MONTHS ENDED MARCH 31, 2004 AND 2003
THREE MONTHS ENDED MARCH 31,
----------------------------
2004 2003
-------- --------
(IN THOUSANDS)
OPERATING ACTIVITIES
Net cash (used in) provided by operating activities $ (4,007) $ 780
INVESTING ACTIVITIES
Sales of:
Fixed maturities available for sale 10,221 13,214
Equity securities available for sale 526 409
Other invested assets 29 --
Maturities, prepayments and scheduled redemption of:
Fixed maturities available for sale -- --
Purchase of:
Fixed maturities available for sale (3,147) (10,080)
Equity securities available for sale (1,987) (3,387)
Decrease in commercial mortgage loans on real estate 16 --
Decrease in short-term investments 1,702 667
Decrease (Increase) in policy loans -- (2)
-------- --------
Net cash provided by investing activities 7,360 823
Change in cash and cash equivalents 3,353 1,603
Cash and cash equivalents at beginning of period 1,060 2,042
-------- --------
Cash and cash equivalents at end of period $ 4,413 $ 3,645
======== ========
6
See the accompanying notes to the financial statements
FIRST FORTIS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2004 AND 2003 (UNAUDITED)
1. NATURE OF OPERATIONS
First Fortis Life Insurance Company (the "Company") is a provider of life
and health insurance products. At January 1, 2004, the Company was a wholly
owned subsidiary of Assurant, Inc. (formerly Fortis, Inc.), which itself was an
indirect, wholly owned subsidiary of Fortis N.V. of the Netherlands and Fortis
SA/NV of Belgium (collectively, "Fortis") through their affiliates, including
their wholly owned subsidiary, Fortis Insurance N.V.
On February 5, 2004, Fortis sold approximately 65% of its ownership
interest in Assurant, Inc. via an Initial Public Offering ("IPO"). In connection
with the IPO, Fortis, Inc. was merged into Assurant, Inc., a Delaware
corporation, which was formed solely for the purpose of the redomestication of
Fortis, Inc. After the merger, Assurant, Inc. became the successor to the
business, operations and obligations of Fortis, Inc. Assurant, Inc. is traded on
the New York Stock Exchange under the symbol AIZ.
The Company is incorporated in New York and is qualified to sell life,
health and annuity insurance in the state of New York. The Company's revenues
are derived principally from group employee benefits products and credit
products. The Company offers insurance products, including life insurance
policies, and group life, accident and health insurance policies.
2. BASIS OF PRESENTATION
The accompanying unaudited interim financial statements have been prepared
in accordance with generally accepted accounting principles in the United States
of America ("GAAP") for interim financial information. Accordingly, these
statements do not include all of the information and footnotes required by
generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Certain prior period amounts have been reclassified to conform to the
2004 presentation.
Dollar amounts are presented in U.S. dollars and all amounts are in
thousands except for number of shares and per share amounts.
The financial statements include the accounts of the Company and all of
its wholly owned subsidiaries. All significant inter-company transactions and
balances are eliminated in consolidation.
Operating results for the three months ended March 31, 2004 are not
necessarily indicative of the results that may be expected for the year ending
December 31, 2004. The accompanying interim financial statements should be read
in conjunction with the audited financial statements and related notes on form
10K for the fiscal year ended December 31, 2003.
3. RECENT ACCOUNTING PRONOUNCEMENTS
On July 7, 2003, the Accounting Standards Executive Committee (AcSEC) of
the American Institute of Certified Public Accountants (AICPA) issued Statement
of Position 03-1, Accounting and Reporting by Insurance Enterprises for Certain
Nontraditional Long Duration Contracts and for
7
FIRST FORTIS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 2004 AND 2003 (UNAUDITED)
Separate Accounts ("SOP 03-1"). SOP 03-1 provides guidance on a number of topics
unique to insurance enterprises, including separate account presentation,
interest in separate accounts, gains and losses on the transfer of assets from
the general account to a separate account, liability valuation, returns based on
a contractually referenced pool of assets or index, accounting for contracts
that contain death or other insurance benefit features, accounting for
reinsurance and other similar contracts, accounting for annuitization benefits
and sales inducements to contract holders. SOP 03-1 will be effective for the
Company's financial statements on January 1, 2004. The adoption of this
statement did not have a material impact on the Company's financial position or
the results of operations.
4. RETIREMENT AND OTHER EMPLOYEE BENEFITS
The Company is a wholly-owned subsidiary of Assurant, Inc., which sponsors
a defined benefit pension plan covering employees and certain agents who meet
eligibility requirements as to age and length of service. Pension cost allocated
to the Company amounted to approximately $28 and $15 for March 31, 2004 and
2003, respectively.
The Company participates in a contributory profit sharing plan, sponsored
by Assurant, Inc. covering employees and certain agents who meet eligibility
requirements as to age and length of service. The amount expensed was
approximately $10 and $15 for March 31, 2004 and 2003, respectively.
In addition to retirement benefits, the Company participates in other
health care and life insurance benefit plans (postretirement benefits) for
retired employees, sponsored by Assurant, Inc. There were no net postretirement
benefit costs allocated to the Company for the three months ended March 31, 2004
and 2003. For the three months ended March 31, 2004 and 2003, the Company
incurred expenses related to retirement benefits of $8 and $3, respectively.
5. INCOME TAXES
The effective tax rate for the three months ended March 31, 2004 was 35.1%
as compared to 35.0% for the three months ended March 31, 2003.
6. SUBSEQUENT EVENTS
There are no subsequent events to report.
7. COMMITMENTS AND CONTINGENCIES
The Company is regularly involved in litigation in the ordinary course of
business, both as a defendant and as a plaintiff. The Company may from time to
time be subject to a variety of legal and regulatory actions relating to the
Company's current and past business operations. While the Company cannot predict
the outcome of any pending or future litigation, examination or investigation,
the Company does not believe that any pending matter will have a material
adverse effect on the Company's financial condition or results of operations.
8
PART I
FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
Management's Discussion and Analysis of Financial Condition and Results of
Operations (MD&A) addresses the financial condition of First Fortis Life
Insurance Company (FFLIC or the Company) as of March 31, 2004, compared with
December 31, 2003, and its results of operations for the three months ended
March 31, 2004, compared with the equivalent 2003 period. This discussion should
be read in conjunction with FFLIC's MD&A and annual audited financial statements
as of December 31, 2003 filed with the Company's Form 10-K for the year ended
December 31, 2003 filed with the U.S. Securities and Exchange Commission
(hereafter referred to as the Company's 2003 Form 10-K) and unaudited
consolidated financial statements and related notes included elsewhere in this
Form 10-Q.
Some of the statements in this MD&A and elsewhere in this report may
contain forward-looking statements that reflect our current views with respect
to, among other things, future events and financial performance. You can
identify these forward-looking statements by the use of forward-looking words
such as "outlook," "believes," "expects," "potential," "continues," "may,"
"will," "should," "seeks," "approximately," "predicts," "intends," "plans,"
"estimates," "anticipates" or the negative version of those words or other
comparable words. Any forward-looking statements contained in this report are
based upon our historical performance and on current plans, estimates and
expectations. The inclusion of this forward-looking information should not be
regarded as a representation by us or any other person that the future plans,
estimates or expectations contemplated by us will be achieved. Such
forward-looking statements are subject to various risks and uncertainties.
Accordingly, there are or will be important factors that could cause our actual
results to differ materially from those indicated in this report. If one or more
of these or other risks or uncertainties materialize, or if our underlying
assumptions prove to be incorrect, actual results may vary materially from what
we projected. Any forward-looking statements you read in this report reflect our
current views with respect to future events and are subject to these and other
risks, uncertainties and assumptions relating to our operations, results of
operations, financial condition, growth strategy and liquidity.
9
RESULTS OF OPERATIONS
CONSOLIDATED OVERVIEW
The table below presents information regarding our consolidated results of
operations:
FOR THE THREE MONTHS
ENDED
MARCH 31,
2004 2003
---- ----
(IN MILLIONS)
REVENUES:
Net earned premiums and other considerations $ 16 $ 17
Net investment income 3 3
---- ----
Total revenues 19 20
---- ----
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits (8) (10)
Selling, underwriting and general expenses(1) (5) (6)
---- ----
Total benefits, losses and expenses (13) (16)
---- ----
INCOME BEFORE INCOME TAXES 6 4
Income taxes (2) (1)
---- ----
NET INCOME $ 4 $ 3
==== ====
- ---------------
(1) Includes amortization of DAC.
THREE MONTHS ENDED MARCH 31, 2004 COMPARED TO THREE MONTHS ENDED MARCH 31, 2003
Total Revenues
Total revenues decreased by $1 million, or 5%, from $20 million for the
three months ended March 31, 2003, to $19 million for the three months ended
March 31, 2004.
Net earned premiums and other considerations decreased by $1 million, or
6%, from $17 million for the three months ended March 31, 2003, to $16 million
for the three months ended March 31, 2004. This decrease was primarily due to a
decline in the rate of renewals for both the life, dental and the credit life
business. The decline in renewals for the life and dental business resulted
primarily from our continued pricing discipline. The decline in renewals for the
credit life business resulted primarily from an adverse regulatory climate that
has affected this line of business. Our total net earned premiums were derived
85% and 80% from the life, dental and disability business in 2004 and 2003,
respectively, and 15% and 20% from the credit life business in 2004 and 2003,
respectively.
Net investment income remained unchanged at $3 million for the three
months ended March 31, 2004 compared to March 31, 2003.
Total Benefits, Losses, and Expenses
Total benefits, losses, and expenses decreased by $3 million, or 19%, from
$16 million for the three months ended March 31, 2003, to $13 million for the
three months ended March 31, 2004.
Policyholder benefits decreased by $2 million, or 20%, from $10 million
for the three months ended March 31, 2003, to $8 million for the three months
ended March 31, 2004. The decrease was driven by favorable development in life
claims and lower claims volume due to the reduction in net earned premiums. The
total policyholder benefit to premium ratio decreased from 59% for the three
months ended March 31, 2003, to 53% for the three months ended March 31, 2004.
Our overall decrease is due primarily
10
to the favorable development in life claims. In the life business, the
policyholder benefit to premium ratio decreased from 79% for the three months
ended March 31, 2003, to 13% for the three months ended March 31, 2004. The
improvement in the group life policyholder benefit to premium ratio is driven by
favorable mortality experience and favorable reserve runoff on terminated
cases.
Selling, underwriting and general expenses decreased by $1 million, or
17%, from $6 million for the three months ended March 31, 2003, to $5 million
for the three months ended March 31, 2004. Our general and administrative
expense to premium ratio stayed flat at 20% from March 31, 2003, to March 31,
2004.
Net income increased by $1 million, or 33%, from $3 million for the three
months ended March 31, 2003, to $4 million for the three months ended March 31,
2004.
Income taxes increased from $1 million for the three months ended March
31, 2003, to $2 million for the three months ended March 31, 2004.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not required under reduced disclosure format.
ITEM 4. CONTROLS AND PROCEDURES.
Under the supervision and with the participation of our Chief Executive
Officer and our Chief Financial Officer, we have evaluated the effectiveness of
our disclosure controls and procedures as of March 31, 2004. Based on this
evaluation, our Chief Executive Officer and our Chief Financial Officer have
concluded that our disclosure controls and procedures were effective as of that
date in providing a reasonable level of assurance that information we are
required to disclose in reports we file or furnish under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time
periods in SEC rules and forms. Further, our disclosure controls and procedures
were effective in providing a reasonable level of assurance that information
required to be disclosed by us in such reports is accumulated and communicated
to our management, including our Chief Executive Officer and our Chief Financial
Officer, as appropriate to allow timely decisions regarding required disclosure.
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
ITEM 2. CHANGES IN SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASES OF EQUITY
SECURITIES.
Not required under reduced disclosure format.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not required under reduced disclosure format.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not required under reduced disclosure format.
11
ITEM 5. OTHER INFORMATION.
(a) None.
(b) Because all of the Company's outstanding common stock is held
directly by Assurant, Inc., the Company does not file a Schedule 14A
and has not adopted any procedures by which security holders may
recommend nominees to the registrant's board of directors.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(A) EXHIBITS
The following exhibits either (a) are filed with this report or (b) have
previously been filed with the SEC and are incorporated herein by reference to
those prior filings. Exhibits are available upon request at the investor
relations section of our website, located at www.assurant.com.
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
- ------ -------------------
3.1 Articles of Incorporation of First Fortis Life Insurance Company
(incorporated by reference from the Registrant's Form 10-K filed,
File No. 33-71690, filed on March 29, 1996).
3.2 By-laws of First Fortis Life Insurance Company (incorporated by
reference from the Registrant's Registration Statement on Form N-4,
File No. 33-71686, and Separate Account A filed on November 15,
1993).
4.1 Form of Combination Fixed and Variable Group Annuity Contract;
(incorporated by reference from the Registrant's Post-Effective
Amendment No. 2 to the Registration Statement on Form N-4, File No.
33-71686, and Separate Account A filed on April 27, 1995).
4.2 Form of Application to be used in connection with Form of
Combination Fixed and Variable Group Annuity Contract filed as
Exhibit 4.1 to this report (incorporated by reference from the
Registrant's Post-Effective Amendment No. 2 to the Registration
Statement on Form N-4, File No. 33-71686, and Separate Account A
filed on April 27, 1995).
4.3 Form of IRA Endorsement (incorporated by reference from the
Registrant's Post- Effective Amendment No. 2 to the Registration
Statement on Form N-4, File No. 33- 71686, and Separate Account A
filed on April 27, 1995).
4.4 Form of Section 403(b) Annuity Endorsement (incorporated by
reference from Registrant's Post-Effective Amendment No. 2 to the
Registration Statement on Form N-4, File No. 33-71686, and Separate
Account A filed on April 27, 1995).
31.1 Rule 13a-14(a)/15d-14(a) Certification of Principal Executive
Officer.
31.2 Rule 13a-14(a)/15d-14(a) Certification of Principal Financial
Officer.
32.1 Certification of Chief Executive Officer of First Fortis Life
Insurance Company pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 Certification of Chief Financial Officer of First Fortis Life
Insurance Company 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
None.
12
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.
FIRST FORTIS LIFE INSURANCE COMPANY
Date: May 14, 2004 By: /s/ Lance Wilson
-----------------------------------
Name: Lance Wilson
Title: President and, Chief
Executive Officer (Principal
Executive Officer)
Date: May 14, 2004 By: /s/ Ranell Jacobson
-----------------------------------
Name: Ranell Jacobson
Title: Treasurer
13