UNITED STATES SECURITIES AND EXCHANGE COMMISSION

FORM 10-Q

For the quarterly period ended March 31, 2005
Or

For the transition period from            to

Radyne ComStream Inc.

Registrant’s telephone number including area code: (602) 437-9620

     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  þ  No  o

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Securities Exchange Act of 1934.   Yes  þ  No  o

     The number of shares of the registrant’s common stock, which were outstanding as of the close of business on April 25, 2005 was 16,638,549.

Table of Contents

Part I
FINANCIAL INFORMATION

Item 1. Financial Statements.

Radyne ComStream Inc.
Condensed Consolidated Balance Sheets
(in thousands, except share data)

See Notes to Condensed Consolidated Financial Statements

2

See Notes to Condensed Consolidated Financial Statements

3

Radyne ComStream Inc.
Condensed Consolidated Statements of Cash Flows
Unaudited
(in thousands)

See Notes to Condensed Consolidated Financial Statements

4

Radyne ComStream Inc.
Notes to Condensed Consolidated Financial Statements
(Information for March 31, 2005 and 2004 is Unaudited)

(1)	Basis of Presentation
	The unaudited condensed consolidated financial statements of Radyne ComStream Inc. (the “Company”) for the three months ended March 31, 2005 and 2004 have been prepared in accordance with accounting principles generally accepted in the United States of America and the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments necessary, all of which are of a normal recurring nature, to present fairly the Company’s financial position, results of operations and cash flows. Interim results are not necessarily indicative of results for a full year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004.
	The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Such estimates and assumptions affect the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates and assumptions based upon historical experience and various other factors and circumstances. The Company believes that its estimates and assumptions are reasonable in the circumstances; however, actual results may differ from these estimates under different future conditions.
	Certain reclassifications have been made to the prior years condensed consolidated financial statements to conform to the current year presentation.
(2)	Employee Stock Options
	The Company has elected to follow Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees (APB 25) and related interpretations in accounting for its employee stock options and to adopt the “disclosure only” alternative treatment under Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation (SFAS 123). Under SFAS 123, deferred compensation is recorded for the fair value of the stock on the date of the option grant. The deferred compensation is amortized over the vesting period of the option.
	The Company applies APB 25 in accounting for its employee stock options. Had the Company determined compensation cost based on the fair value at the grant date for its stock options under SFAS 123, the Company’s net earnings and earnings per share would have been reduced to the pro forma amounts indicated below:

5

The fair value of options granted was estimated on the date of grant with vesting periods ranging from one to three years using the Black-Scholes option-pricing model with the following weighted average assumptions used: no dividend yield, expected volatility of 58 percent — 80 percent, risk free interest rate of 3.5 percent — 3.75 percent and an expected life of three to five years. The per share weighted average fair value of stock options granted for the three months ended March 31, 2005 and 2004 were $3.84 and $5.86, respectively using the Black-Scholes option-pricing model and the assumptions listed above. The pretax value of the fair value of the stock options for the three months period ended March 31, 2005 and March 31, 2004 were both $345,000. The after tax amounts differ mainly due to the change in effective tax rates as further discussed in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

(3)	Earnings Per Share
	A reconciliation of the numerators and the denominators of the basic and diluted per share computations and a description and amount of potentially dilutive securities follows:

6

(4)	Inventories

     Inventories consist of the following:

(5)	Property and Equipment

     Property and equipment consist of the following:

(6)	Accrued Expenses

     Accrued expenses consist of the following:

     Lease exit costs of $67,000, relating to restructuring liabilities, were paid in full in February 2005.

(7)	Common Stock
	On June 4, 2004, the Board of Directors authorized management to purchase up to $10 million of the Company’s outstanding common stock. As of March 31, 2005, the Company has purchased 402,600 shares under the program at a total cost of $2,791,000. This program expires on June 3, 2005 and was the only repurchase program outstanding at December 31, 2004. There have been no shares purchased under the program for the first quarter of 2005.
(8)	Warrants
	After December 31, 2004 but prior to the expiration date of February 7, 2005, 310,571 of our redeemable common stock purchase warrants were exercised. We received proceeds of $2.7 million related to the exercises and have issued 310,571 shares of our common stock to the former holders of the redeemable warrants. The remaining 1,832,966 unexercised warrants expired on February 7, 2005. The warrants were issued as part of our 2000 secondary offering and were redeemable at $8.75 per share.

7

(9)	Concentrations of Risk
	The Company had one customer which comprised 13.6% of total accounts receivable at March 31, 2005 compared to 10.0% at December 31, 2004. The customer who owed the largest amount at March 31, 2005 is the same customer who owed the largest amount at December 31, 2004.
(10)	Acquisition
	On March 3, 2005, the Company announced that it intended to acquire Xicom Technology Inc. for approximately $41 million of cash and stock. The transaction has been approved by the Board of Directors of both companies and is expected to close during the second quarter of 2005. Closing is subject to completion of a satisfactory pre-closing audit, receipt and approval of complete disclosure schedules, and customary closing conditions.

8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

     For a description of the Company’s significant accounting policies and an understanding of the significant factors that influenced the Company’s performance during the three months ended March 31, 2005 and 2004, this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (“MD&A”) should be read in conjunction with the Condensed Consolidated Financial Statements, including the related notes, appearing in Item 1 of this Report as well as the Company’s Annual Report on Form 10-K for the year ended December 31, 2004.

     Except for the historical information contained herein, the following discussion includes statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”) and the Company claims the protection of the safe-harbor for forward-looking statements contained in the Reform Act. These forward-looking statements are often characterized by the terms “may,” “believes,” “projects,” “expects,” or “anticipates,” and do not reflect historical facts. Specific forward-looking statements contained in the following discussion include, but are not limited to, (i) continued growth in demand for satellite system ground-based equipment and satellite-delivered communications services, (ii) continued global deregulation and privatization of telecommunications carriers, (iii) continued growth in worldwide demand for Internet over Satellite connectivity and communications serves in general, (iv) expectations for continued growth and improvement in gross margin associated with product introductions, (v) our ability to complete the Xicom acquisition and integrate the operations, products and personnel of Xicom with the Company, (vi) an increase in total foreign sales, and (vii) sufficient cash reserves and cash from operations to fund planned future operations and capital requirements through the end of 2005.

     Forward-looking statements involve risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. Factors that could affect our results and cause them to materially differ from those contained in the forward-looking statements include:

•	availability of future taxable income to be able to realize the deferred tax assets;
•	loss of, and failure to replace, any significant customers;
•	timing and success of new product introductions;
•	product developments, introductions and pricing of competitors;
•	timing of substantial customer orders;
•	availability of qualified personnel;
•	the impact of local, political and economic conditions and foreign exchange fluctuations on international sales;
•	performance of suppliers and subcontractors;
•	decreasing or stagnant market demand and industry and general economic or business conditions;
•	availability, cost and terms of capital;
•	our level of success in effectuating our strategic plan;
•	our ability to successfully integrate acquisitions;
•	adequacy of our inventory, receivables and other reserves;
•	the effects that acts of international terrorism may have on our ability to ship products abroad;
•	other “Risk Factors” set forth are in Exhibit 99.1, which is an exhibit to the Annual Report on Form 10-K; and
•	other factors that the Company is currently unable to identify or quantify, but may arise or become known in the future.

     In addition, the foregoing factors may generally affect our business, results of operations and financial position.

     Forward-looking statements speak only as of the date the statement was made. The Company does not undertake and specifically declines any obligation to update any forward-looking statements.

     A copy of the annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports are available, free of charge, through our website found at www.radn.com in the Investor Info section, as soon as reasonably practical after such material is electronically filed with the Securities and Exchange Commission (the “Commission”).

9

Overview

     Radyne ComStream Inc. operates primarily in North America in the satellite communications industry. The Company is headquartered in Phoenix, Arizona with manufacturing facilities in both Phoenix and San Diego, California. Additionally, sales offices are located in Boca Raton, Florida, Singapore, Beijing, Jakarta, London and Amsterdam. The Company also contracts with representatives that provide sales and/or service centers in Rio de Janeiro, Bangalore, Shanghai and Moscow. The Company employs 168 employees throughout the USA, Europe and Asia.

     The Company designs, manufactures, integrates, installs and sells equipment used in the ground-based portion of satellite communication systems to receive and transmit data, video, audio and Internet over satellite, microwave and cable communications networks. The products are used in applications for telephone, data, video and audio broadcast communications, private and corporate data networks, Internet applications and digital television for cable and network broadcast.

     The Phoenix facility designs and manufactures satellite and point-to-point modems and allied equipment. The San Diego facility designs and manufactures audio and video encoders, satellite modems and Internet over satellite hardware. Through its Tiernan Communications, Inc. subsidiary, the Company supplies high-definition television (HDTV) and standard definition television encoding and transmission equipment. Its Armer Engineering Services, Inc. subsidiary provides solutions for the integration and installation of turnkey communications systems. Through its network of international offices and service centers, the Company serves customers in over 90 countries, including customers in the television broadcast industry, international telecommunications companies, Internet service providers, private communications networks, network and cable television and the United States government. The Company sells and distributes its products under the Radyne, Radyne ComStream and Tiernan brands.

     On March 2, 2005 the Company entered into a definitive merger agreement to acquire Xicom Technology Inc. (“Xicom”). The transaction has been approved by the Board of Directors of both companies and is expected to close within the next 30 days. Closing is subject to completion of a satisfactory pre-closing audit, receipt and approval of complete disclosure schedules, and customary closing conditions. Xicom is a leading provider of satellite and microwave power amplifiers and other RF products. Xicom’s Solid State Power Amplifiers (SSPAs), Traveling Wave Tube Amplifiers (TWTAs), and Klystron Power Amplifiers (KPAs) are used in commercial and military satellite communications terminals throughout the world. Xicom High Power Amplifiers (HPAs) provide power levels vital to satellite communications in fixed, SNG, flyaway, mobile, shipboard, and airborne platforms. The combination of Xicom’s amplifier products and RF technologies with Radyne ComStream’s line of satellite modems and other satellite communications equipment will make the Company a full line supplier of satellite electronic systems. Xicom has manufacturing facilities in Santa Clara, California and a sales office in the United Kingdom.

     The Company has one operating business segment, the sale, integration and installation of equipment for satellite, microwave and cable communications and television networks.

     The following were some of the highlights and recent developments for the three months ended March 31, 2005:

	•	Net earnings for the first three months were $0.08 per fully diluted share compared to net earnings of $0.18 for the first three months of 2004. The decreased profitability resulted primarily from a drop in net sales ($13.7 million in 2005 compared to $15.1 million in 2004), an increase in total operating expense ($5.2 million in 2005 compared to $4.7 million in 2004) and increase in the Company’s tax rate from 6.5% to 33.6%.
	•	Orders received (bookings) during the first three months of 2005 increased 19% over the equivalent period of 2004 ($13.5 million in 2005 compared to $11.3 million in 2004).

Additional information on these and other operating results are described in greater detail below.

10

Results of Operations

     Sales. Net sales generally consist of sales of products, net of returns and allowances. Our sales have come predominantly from satellite modems, video signal encoders, point-to-point modems, Internet over satellite systems and systems integrations and installations. The following tables summarize the year-over-year comparison of our revenue for the periods indicated:

     Research and development. Research and development expenses consist primarily of salaries and personnel-related costs, development materials and other product development expenses. The following tables summarize the year-over-year comparison of our research and development expenses for the periods indicated:

     Total research and development expenses increased 16% during first quarter of 2005 from the first quarter of 2004. This was due almost entirely to an increase in new product development for the first quarter of 2005. Management believes that these new products fit our previously stated strategy to invest in the Company’s future through research efforts that will result in new sales and returns to the company well in excess of the current development expense.

     Income Taxes. Income tax expense consists of amounts recognized as payable to the federal government and states in which the Company does business.

     During the quarter our income tax expense increased as a result of an increase in our effective tax rate from 6.5% to 33.6% which was partially offset by a reduction in our taxable income ($2,176,000 in 2005 compared to $3,355,000 in 2004). The reduction in taxable income resulted from the combination of reduced sales, reduced gross margin and increased expenses as described above. The increase in the tax rate resulted from the Company’s decision, at the end of the third quarter of 2004, to reduce our valuation allowance recorded against our deferred tax assets which resulted from the carryforward of losses from previous years. In the third quarter 2004, we determined that based on consecutive quarters of profitable operations plus a forecast of continued profitability such valuation allowance was no longer required.

     Management continues to believe that it is more likely than not the deferred tax assets will be realized through the generation of future taxable income. Ultimate realization of any or all of the deferred tax assets is not assured due to significant uncertainties associated with estimates of future taxable income during the carryforward periods and is subject to change depending on the tax laws in effect in the years in which the carryforwards are used. Management will continue to evaluate the recoverability of the deferred tax assets and will adjust the valuation allowance recorded against the deferred tax assets as required.

     Net Earnings. Net earnings is the result of reducing gross profit by selling, general and administrative, research and development, other income and expense (including interest), and income taxes. The following tables summarize our net earnings and the earnings available to each fully diluted share of common stock:

     Net earnings decreased to $0.08 per share on a diluted basis for the quarter ended March 31, 2005, compared to $0.18 per share for the first quarter of 2004. The decrease in earnings resulted primarily from a drop in net sales, an increase in total operating expense and the increase in the Company’s tax rate from 6.5% to 33.6% as discussed above. While management believes that tax rates and expense levels are likely to remain at current levels, we also expect that historic order and seasonal timing patterns indicate that sales, and hence, earnings, should increase over the remaining quarters of the year. This belief is further reinforced by the strength of our order backlog as described in the next section.

12

     Bookings and Backlog. Bookings consist of orders taken while backlog is the total of these orders not yet shipped at the end of the period. The following tables summarize the year-over-year comparison of our Bookings (orders taken) and Backlog (orders to be shipped in future periods) for the periods indicated:

     During the first quarter of 2005, bookings increased 19% compared to the first quarter of 2004. During the first quarter of 2004, we accelerated a shipment of $1.3 million order, originally scheduled for the second quarter of 2004, pursuant to a customer request. These two factors, coupled with a higher backlog at the beginning of 2005, resulted in an increase of order backlog from the end of the first quarter of 2004 to the end of the first quarter of 2005 of $106%. We believe that this order backlog is consistent with our sales budgets for the remainder of the year.

Liquidity and Capital Resources

     The Company had cash and cash equivalents totaling $43.7 million at March 31, 2005 compared to $39.3 million at December 31, 2004, an increase of $4.4 million compared to $32.9 million at the end of March 31, 2004. The primary factors in the increase were cash provided by financing activities of $3.1 million and cash provided by operating activities of $1.6 million.

Operating Activities:

     Net cash provided by operating activities for the first three months of 2005 was $1.6 million as compared to $1.5 million for the first three months of 2004. Net cash provided by operating activities primarily resulted from net earnings of $1.4 million, deferred income taxes of $598,000, a decrease in accounts receivable of $1.1 million and an increase in customer advanced payments of $496,000. This was offset by decreases in accrued expenses of $1.7 million an increase in inventory of $508,000 and an increase in prepaids and other assets of $302,000.

Investing Activities:

     Net cash used in investing activities for the first three months of 2005 was $307,000 as compared to $188,000 for the first three months of 2004. The decrease was due to capital expenditures of $321,000 offset by $14,000 of proceeds from disposal of assets.

Financing Activities:

     Net cash provided by financing activities for the first three months of 2005 was $3.1 million as compared to $1.5 million for the first three months of 2004. The increase was due to the exercise of stock options of $340,000 and redeemable warrants of $2.7 million.

     Contractual Obligations

     For a description of the Company’s Contractual Obligations and Commitments for the next five years and thereafter, see Item 7 in the Company’s Annual Report on Form 10-K. For a description of the Company’s Commitments for the next five years and thereafter, see Item 8, Notes to Consolidated Financial Statements in the Company’s Annual Report on Form 10-K. There are no material changes to this information.

     Impact of Inflation

     We do not believe that inflation has had a material impact on revenues or expenses during the last quarter reported on herein. We do not expect that inflation will materially affect our business within the next year.

     Off Balance Sheet Arrangements

     The Company does not have any off balance sheet arrangements as defined by Regulation S-K 229.303(a)(4) promulgated under the Securities Exchange Act of 1934.

13

     Liquidity Analysis

     The Company maintains a credit arrangement with a bank for up to $15 million, based upon 75% of eligible accounts receivable, as defined plus cash. The amount of credit available to us under the credit agreement at March 31, 2004 was approximately $11.75 million. We paid approximately $50,000 for a facility fee and bank costs for a two year commitment on the arrangement, whether or not any amounts are actually drawn on the line of credit. At March 31, 2005 and at December 31, 2004, we had no borrowings against the line of credit.

     The credit agreement expires on May 1, 2008 and limits or prohibits mergers, consolidations, acquisitions, transfers of assets, liens, loans and investments in other entities and limits the use of proceeds, acquisitions of assets, indebtedness and capital expenditures without the bank’s consent. To be eligible to draw funds under the line of credit, the credit agreement requires us to maintain specific levels of tangible net worth, earnings and other ratios. We were in compliance with all covenants at March 31, 2005. The credit agreement specifies an interest rate between LIBOR plus 150 basis points and prime rate minus 50 basis points depending on terms and other conditions.

     Under this credit facility, we borrowed $5 million in the form of a term note with three year maturity on May 2, 2005. These funds will be used to provide working capital and to finance the planned acquisition of Xicom Technology. We borrowed these funds and simultaneously entered into an interest rate swap hedge agreement to establish a fixed 5.61% interest rate for the first 18 months of the loan. During the remaining term of the note, the interest rate will revert to LIBOR plus 150 basis points. There is no prepayment penalty associated with the note.

     As part of its business strategy, the Company occasionally evaluates potential acquisitions of businesses, products and technologies. These potential transactions may require substantial capital resources, which, in turn, may require the Company to seek additional debt or equity financing. There are no assurances that the Company will be able to consummate any of these transactions or that it will have the liquidity available to consummate the transactions it desires. For more detailed information, see the Company’s Risk Factors contained in Exhibit 99.1 to the Annual Report on Form 10-K.

     After December 31, 2004 but prior to the expiration date of February 7, 2005, 310,571 of our redeemable common stock purchase warrants were exercised. We received proceeds of $2.7 million related to the exercises and have issued 310,571 shares of our common stock to the former holders of the redeemable warrants. The remaining 1,832,966 unexercised warrants expired on February 7, 2005. The warrants were issued as part of our 2000 secondary offering and were redeemable at $8.75 per share.

Recent Accounting Pronouncements

     In November 2004, the FASB issued Statement No. 151, Inventory Costs (SFAS 151). SFAS 151 requires that abnormal amounts of idle facility expense, freight, handling costs, and spoilage, be charged to expense in the period they are incurred rather than capitalized as a component of inventory costs. SFAS 151 is effective for inventory costs incurred in fiscal periods beginning after June 15, 2005. The adoption of this standard may result in higher expenses in periods where production levels are lower than normal ranges of production. We currently believe that the adoption of SFAS 151 will not have a material impact on our consolidated financial statements.

     In December 2004, FASB issued SFAS No. 123 (Revised 2004), Share-Based Payments (SFAS 123R). SFAS 123R requires an entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award with the cost to be recognized over the period during which an employee is required to provide service in exchange for the award. On April 14, 2005, the Securities and Exchange Commission amended the compliance date for SFAS No. 123R to the beginning of the next fiscal year that begins after June 15, 2005. Accordingly, the Company will adopt this revised SFAS effective January 1, 2006. The Company is currently evaluating how it will adopt SFAS No. 123R and has not determined the method it will use to value granted stock options. The impact of adoption SFAS 123R may be material to the Company’s results of operations.

14

Item 3. Quantitative and Qualitative Disclosures About Market Risk

     The Company is exposed to certain market risks in the ordinary course of our business. These risks result primarily from changes in interest rates. In addition, our international operations are subject to risks related to differing economic conditions, changes in political climate, differing tax structures and other regulations and restrictions.

     The Company is exposed to market risk on our financial instruments from changes in interest rates. As of March 31, 2005, a change in interest rates of 10% over a year’s period would not have a material impact on our interest earnings. On May 2, 2005, we entered into an interest swap hedging arrangement in order to fix the rate of interest on a term loan. The hedging arrangement has an 18-month term while the term loan has a 36-month term. On the expiration of the hedging agreement, the loan will revert to a variable interest rate as described above in Liquidity Analysis.

Item 4. Controls and Procedures

     The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its periodic reports filed with the Commission is recorded, processed, summarized and reported, within the time periods specified in rules and forms of the Commission and that such information is accumulated and communicated to its management. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

     On March 2, 2005 the Company entered into a definitive merger agreement to acquire Xicom Technology Inc (“Xicom”). Management anticipates that once the merger is consummated, certain controls and procedures within Xicom and Radyne ComStream will need to be evaluated and potentially modified to maintain effectiveness in light of the additional activity related to the integration and operation of Xicom.

     The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures as of March 31, 2005. Based upon such review, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended) are effective. There were not any significant changes in internal controls or in other factors that could significantly affect these internal controls subsequent to the date of their most recent evaluation.

15

Part II
OTHER INFORMATION

Item 1. Legal Proceedings

     None.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

     On February 19, 2004, Stetsys Pte. Ltd. and Stetsys US, Inc. entered into definitive purchase agreements to sell their unregistered shares of common stock in the Company, an aggregate of 9,676,800 shares, to approximately 40 institutional investors in a private transaction. The purchase price of the common stock was $9.25 per share. The shares sold in the transaction were subject to securities law restrictions on their subsequent resale. However, the Company subsequently registered the shares for resale. The Company did not receive any proceeds from this transaction.

Warrants

     After December 31, 2004 but prior to the expiration date of February 7, 2005, 310,571 of our redeemable common stock purchase warrants were exercised. We received proceeds of $2.7 million related to the exercises and have issued 310,571 shares of our common stock to the former holders of the redeemable warrants. The remaining 1,832,966 unexercised warrants expired on February 7, 2005. The warrants were issued as part of our 2000 secondary offering and were redeemable at $8.75 per share.

Issuer Purchases of Equity Securities

     On June 4, 2004, the Board of Directors authorized management to purchase up to $10 million of the Company’s outstanding common stock. As of March 31, 2005, the Company has purchased 402,600 shares under the program at a total cost of $2.8 million. This program expires on June 3, 2005 and was the only repurchase program outstanding at March 31, 2005. The following chart provides detailed information on the program:

Item 3. Defaults Upon Senior Securities

16

     None.

Item 4. Submission of Matters to a Vote of Security Holders

     None.

Item 5. Other Information

     None.

Item 6. Exhibits

     See Exhibit Index.

17

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.

Dated: May 10, 2005

18

EXHIBIT INDEX

19