NEWPORT BEACH, Calif., Aug 4, 2004 (BUSINESS WIRE) -- William Lyon Homes (WLS)
today reported that net income for the second quarter ended June 30, 2004
increased 126% to $31,148,000, or $3.14 per diluted share, as compared to
net income of $13,792,000, or $1.38 per diluted share, for the comparable
period a year ago. Consolidated operating revenue increased 142% to
$384,483,000 for the quarter ended June 30, 2004, as compared to
$158,734,000 for the comparable period a year ago. Consolidated operating
revenue in the 2004 period includes revenue of $81,937,000 from
consolidated joint ventures with no comparable amount included in
consolidated operating revenue in the 2003 period, due to the adoption of
Financial Accounting Standards Board Interpretation No. 46, Consolidation
of Variable Interest EnThe Company reported that net income for the six
months ended June 30, 2004 increased 149% to $46,557,000, or $4.70 per
diluted share, as compared to net income of $18,674,000, or $1.87 per
diluted share, for the comparable period a year ago. Consolidated
operating revenue increased 176% to $639,031,000 for the six months ended
June 30, 2004, as compared with $231,195,000 for the comparable period a
year ago. Consolidated operating revenue in the 2004 period includes
revenue of $142,914,000 from consolidated joint ventures with no
comparable amount included in consolidated operating revenue in the 2003
period, due to the adoption of Financial Accounting Standards Board
Interpretation No. 46, Consolidation of Variable Interest Entities, as
amended, as described below.
The Company's combined results including joint ventures were as
follows: Net new home orders for the quarter ended June 30, 2004 increased
19% to 1,127, a record for any quarter in the Company's history, as
compared to 948 homes for the quarter ended June 30, 2003. Net new home
orders for the six months ended June 30, 2004 were 2,219, up 30% from
1,705 homes for the six months ended June 30, 2003. The average number of
sales locations during the quarter ended June 30, 2004 was 46, up 18% from
39 in the comparable period a year ago. The number of homes closed in the
second quarter of 2004 was 794 homes, a record for any second quarter in
the Company's history, up 56% from 510 homes in the second quarter of
2003. At June 30, 2004, the backlog of homes sold but not closed totaled
2,088 homes, a record for any quarter in the Company's history, up 39%
from 1,507 homes at June 30, 2003, and up 19% from 1,755 homes at March
31, 2004. At June 30, 2004, the dollar amount of backlog of homes sold but
not closed was $1,140,788,000, a record for any quarter in the Company's
history, up 101% from $567,852,000 at June 30, 2003, and up 24% from
$916,590,000 at March 31, 2004. Selected financial and operating
information for the Company including joint ventures, is set forth in
greater detail in a schedule attached to this release.
For the quarter ended June 30, 2004, the excess of revenue from sales
of homes over the related cost of sales (gross margin) increased by $60.0
million to $84.2 million in the 2004 period from $24.2 million in the 2003
period primarily due to (i) an increase in the number of wholly-owned
homes closed to 635 homes in the 2004 period from 368 homes in the 2003
period; (ii) an increase in the average sales price of wholly-owned homes
to $449,000 in the 2004 period from $379,600 in the 2003 period; (iii) an
increase in wholly-owned gross margin percentages to 23.3% in the 2004
period from 17.4% in the 2003 period; and (iv) gross margin of $17.7
million from consolidated joint ventures in 2004 with no comparable amount
included in 2003, due to the adoption of Interpretation No. 46 as
described below.
For the six months ended June 30, 2004, the excess of revenue from
sales of homes over the related cost of sales (gross margin) increased by
$102.0 million to $138.3 million in the 2004 period from $36.3 million in
the 2003 period primarily due to (i) an increase in the number of
wholly-owned homes closed to 1,100 in the 2004 period from 552 in the 2003
period; (ii) an increase in the average sales price of wholly-owned homes
to $435,200 in the 2004 period from $380,600 in the 2003 period; (iii) an
increase in wholly-owned gross margin percentages to 22.7% in the 2004
period from 17.3% in the 2003 period; and (iv) gross margin of $29.7
million from consolidated joint ventures in 2004 with no comparable amount
included in 2003, due to the adoption of Interpretation No. 46 as
described below.
General William Lyon, Chairman and Chief Executive Officer stated: "We
are very pleased with the Company's outstanding results for the first six
months of 2004. Our strategy of building in three of the top markets in
the United States has been validated by our record results for the first
six months of 2004. We continue to maintain a strong leadership position
in each of these dynamic markets. Our improved operating results in 2004
as compared to the comparable period a year ago have been driven by an
increased number of deliveries as well as by significant improvements in
our gross margins which are attributable, in part, to the strong housing
market in many of the communities in which we build."
General Lyon further stated: "The efficiency of our operations is
demonstrated by our low combined selling, general and administrative
expense rate which was approximately 8.5% for the six months ended June
30, 2004."
General Lyon added: "We are very proud to report to our shareholders
that our return on shareholders' equity for the last twelve months through
June 30, 2004 was approximately 39%, which we believe to be among the
highest in the homebuilding industry."
General Lyon also stated: "On an overall basis, we were very pleased
with our net new home order activity for the second quarter of 2004. Net
new orders were 1,127 for the second quarter of 2004 which were the
highest for any quarter in the Company's history. The 19% increase in
period-over-period net new home orders was primarily a result of a 126%
increase in net new home orders in our Arizona division, and a 31%
increase in net new home orders in our Nevada division. These increases
were offset by a 4% decrease in net new home orders in our California
divisions which is primarily attributable to accelerated sales rates at
many of our projects in California in the first quarter which reduced the
amount of product available for sale in the second quarter; however, our
year-to-date sales through June 30, 2004 in California are up 26%."
General Lyon concluded: "The backlog of homes sold but not closed of
2,088 with a dollar value of $1.1 billion at June 30, 2004, were records
for any quarter end in the Company's history."
Based on the Company's results experienced in the first half of the
year, including our record new orders and our corresponding record
backlog, we are raising our guidance for 2004. We are now targeting 3,400
deliveries, including our consolidated joint ventures, which will result
in total revenues of approximately $1.8 billion, including lot sales. With
our revenue growth as well as our continued margin expansion, our full
year 2004 earnings are estimated to be between $15.50 and $15.75 per
share, reflecting an increase of up to 117% over our full year 2003
earnings per share of $7.27.
Financial Accounting Standards Board Interpretation No. 46,
Consolidation of Variable Interest Entities, as amended ("Interpretation
No. 46") addresses the consolidation of variable interest entities ("VIEs").
Under Interpretation No. 46, arrangements that are not controlled through
voting or similar rights are accounted for as VIEs. An enterprise is
required to consolidate a VIE if it is the primary beneficiary of the VIE.
VIEs include certain homebuilding and land development joint ventures, and
certain entities with which the Company enters into option agreements for
the purchase of land or lots and pays a non-refundable deposit or enters
into land banking arrangements. Interpretation No. 46 applied immediately
to arrangements created after January 31, 2003 and, with respect to
arrangements created before February 1, 2003, the interpretation was
applied to the Company as of January 1, 2004.
Based on the Company's analysis of arrangements created after January
31, 2003, no VIEs had been created for the period from February 1, 2003
through June 30, 2003 with respect to option agreements or land banking
arrangements as identified in the previous paragraph. At June 30, 2003,
three joint ventures created after January 31, 2003 have been determined
to be VIEs under Interpretation No. 46 in which the Company is considered
the primary beneficiary. Accordingly, the assets, liabilities and
operations of these three joint ventures have been consolidated with the
Company's financial statements as of June 30, 2003 and for the three and
six months ended June 30, 2003. At December 31, 2003, certain joint
ventures and one land banking arrangement created after January 31, 2003
had been determined to be VIEs under Interpretation No. 46 in which the
Company is considered the primary beneficiary. Accordingly, the assets,
liabilities and operations of these joint ventures and land banking
arrangement were consolidated with the Company's financial statements as
of December 31, 2003 and for the period then ended. Effective January 1,
2004, certain additional joint ventures and land banking arrangements
created prior to February 1, 2003 have been determined to be VIEs under
Interpretation No. 46 in which the Company is considered the primary
beneficiary. Accordingly, the assets, liabilities and operations of all of
these joint ventures and land banking arrangements have been consolidated
with the Company's financial statements as of January 1, 2004 and for the
three and six months ended June 30, 2004. Included in the Company's
consolidated balance sheet at June 30, 2004 are real estate inventories
related to the VIEs of $392,569,000, together with related notes payable
of $100,193,000 and minority interest of $185,425,000. Because the Company
already recognized its proportionate share of joint venture earnings and
losses under the equity method of accounting, the adoption of
Interpretation No. 46 does not affect the Company's consolidated net
income.
The Company will hold a conference call on Thursday, August 5, 2004 at
11:00 a.m. Pacific Time to discuss the second quarter 2004 earnings
results. The dial-in number is (800) 659-2032 (enter passcode number
97639768). Participants may call in beginning at 10:45 a.m. Pacific Time.
In addition, the call will be broadcast from William Lyon Homes' website
at www.lyonhomes.com in the
"Investor Relations" section of the site. The call will be recorded and
replayed beginning on August 5, 2004 at 1:00 p.m. Pacific Time through
midnight on August 13, 2004. The dial-in number for the replay is (888)
286-8010 (enter passcode number 54290603). Replays of the call will also
be available on the Company's website approximately two hours after
broadcast.
William Lyon Homes is one of the oldest and largest homebuilders in the
Southwest with development communities in California, Arizona and Nevada.
The Company's corporate headquarters are located in Newport Beach,
California.
Certain statements contained in this release that are
not historical information contain forward-looking statements. The
forward-looking statements involve risks and uncertainties and actual
results may differ materially from those projected or implied. Further,
certain forward-looking statements are based on assumptions of future
events which may not prove to be accurate. Factors that may impact such
forward-looking statements include, among others, changes in general
economic conditions and in the markets in which the Company competes,
terrorism or hostilities involving the United States, changes in mortgage
and other interest rates, changes in prices of homebuilding materials,
weather, the occurrence of events such as landslides, soil subsidence and
earthquakes that are uninsurable, not economically insurable or not
subject to effective indemnification agreements, the availability of labor
and homebuilding materials, changes in governmental laws and regulations,
the timing of receipt of regulatory approvals and the opening of projects,
and the availability and cost of land for future development, as well as
the other factors discussed in the Company's reports filed with the
Securities and Exchange Commission.
WILLIAM LYON HOMES
SELECTED FINANCIAL AND OPERATING INFORMATION
(unaudited)
Three Months Ended June 30,
2004
Wholly- Joint Combined
Owned Ventures Total
Selected Financial Information
(dollars in thousands)
Homes closed 635 159
Home sales revenue $ 285,123 $ 81,937
Cost of sales (218,602) (64,226)
Gross margin $ 66,521 $ 17,711
Gross margin percentage 23.3% 21.6%
Number of homes closed
California 311 159 470
Arizona 107 - 107
Nevada 217 - 217
Total 635 159 794
Average sales price
California $ 637,200 $515,300 $595,900
Arizona 234,900 - 234,900
Nevada 284,900 - 284,900
Total $ 449,000 $515,300 $462,300
Number of net new home orders
California 354 276 630
Arizona 278 - 278
Nevada 219 - 219
Total 851 276 1,127
Average number of sales locations during
period
California 20 12 32
Arizona 7 - 7
Nevada 7 - 7
Total 34 12 46
Three Months Ended June 30,
2003
Wholly- Joint Combined
Owned Ventures Total
Selected Financial Information
(dollars in thousands)
Homes closed 368 142
Home sales revenue $ 139,681 $ 69,978
Cost of sales (115,444) (53,884)
Gross margin $ 24,237 $ 16,094
Gross margin percentage 17.4% 23.0%
Number of homes closed
California 174 142 316
Arizona 76 - 76
Nevada 118 - 118
Total 368 142 510
Average sales price
California $ 494,900 $492,800 $493,900
Arizona 229,900 - 229,900
Nevada 305,900 - 305,900
Total $ 379,600 $492,800 $411,100
Number of net new home orders
California 469 189 658
Arizona 123 - 123
Nevada 167 - 167
Total 759 189 948
Average number of sales locations during
period
California 18 8 26
Arizona 7 - 7
Nevada 6 - 6
Total 31 8 39
WILLIAM LYON HOMES
SELECTED FINANCIAL AND OPERATING INFORMATION (Continued)
(unaudited)
As of June 30,
2004
Wholly- Joint Combined
Owned Ventures Total
Backlog of homes sold but not closed at
end of period
California 766 666 1,432
Arizona 423 - 423
Nevada 233 - 233
Total 1,422 666 2,088
Dollar amount of homes sold but not
closed at end of period (in thousands)
California $581,939 $367,268 $ 949,207
Arizona 106,573 - 106,573
Nevada 85,008 - 85,008
Total $773,520 $367,268 $1,140,788
Lots controlled at end of period
Owned lots
California 2,486 2,248 4,734
Arizona 1,249 - 1,249
Nevada 1,362 - 1,362
Total 5,097 2,248 7,345
Optioned lots (1)
California 4,192
Arizona 7,228
Nevada 1,250
Total 12,670
Total lots controlled
California 8,926
Arizona 8,477
Nevada 2,612
Total 20,015
As of June 30,
2003
Wholly- Joint Combined
Owned Ventures Total
Backlog of homes sold but not closed at
end of period
California 758 275 1,033
Arizona 234 - 234
Nevada 240 - 240
Total 1,232 275 1,507
Dollar amount of homes sold but not
closed at end of period (in thousands)
California $327,235 $126,143 $453,378
Arizona 45,884 - 45,884
Nevada 68,590 - 68,590
Total $441,709 $126,143 $567,852
Lots controlled at end of period
Owned lots
California 2,406 1,447 3,853
Arizona 988 - 988
Nevada 1,623 - 1,623
Total 5,017 1,447 6,464
Optioned lots (1)
California 4,060
Arizona 3,981
Nevada 26
Total 8,067
Total lots controlled
California 7,913
Arizona 4,969
Nevada 1,649
Total 14,531
(1) Optioned lots may be purchased by the Company as wholly-owned
projects or may be purchased by newly formed joint ventures.
WILLIAM LYON HOMES
SELECTED FINANCIAL AND OPERATING INFORMATION
(unaudited)
Six Months Ended June 30,
2004
Wholly- Joint Combined
Owned Ventures Total
Selected Financial Information
(dollars in thousands)
Homes closed 1,100 297
Home sales revenue $ 478,694 $ 142,914
Cost of sales (370,002) (113,262)
Gross margin $ 108,692 $ 29,652
Gross margin percentage 22.7% 20.7%
Number of homes closed
California 561 297 858
Arizona 169 - 169
Nevada 370 - 370
Total 1,100 297 1,397
Average sales price
California $ 588,800 $ 481,200 $551,600
Arizona 219,000 - 219,000
Nevada 301,000 - 301,000
Total $ 435,200 $ 481,200 $445,000
Number of net new home orders
California 815 649 1,464
Arizona 385 - 385
Nevada 370 - 370
Total 1,570 649 2,219
Average number of sales locations
during period
California 20 12 32
Arizona 5 - 5
Nevada 7 - 7
Total 32 12 44
Six Months Ended June 30,
2003
Wholly- Joint Combined
Owned Ventures Total
Selected Financial Information
(dollars in thousands)
Homes closed 552 273
Home sales revenue $ 210,104 $ 139,339
Cost of sales (173,817) (107,677)
Gross margin $ 36,287 $ 31,662
Gross margin percentage 17.3% 22.7%
Number of homes closed
California 247 273 520
Arizona 124 - 124
Nevada 181 - 181
Total 552 273 825
Average sales price
California $ 518,600 $ 510,400 $514,300
Arizona 229,700 - 229,700
Nevada 295,700 - 295,700
Total $ 380,600 $ 510,400 $423,600
Number of net new home orders
California 805 353 1,158
Arizona 221 - 221
Nevada 326 - 326
Total 1,352 353 1,705
Average number of sales locations
during period
California 17 8 25
Arizona 6 - 6
Nevada 6 - 6
Total 29 8 37
WILLIAM LYON HOMES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands except per common share amounts)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
Operating revenue
Home sales $ 367,060 $ 139,681 $ 621,608 $ 210,104
Lots, land and other sales 17,423 17,000 17,423 17,000
Management fees - 2,053 - 4,091
384,483 158,734 639,031 231,195
Operating costs
Cost of sales - homes (282,828) (115,444) (483,264) (173,817)
Cost of sales - lots, land
and other (13,826) (10,779) (13,826) (10,802)
Sales and marketing (12,879) (6,222) (23,292) (10,298)
General and administrative (17,054) (11,327) (30,718) (21,166)
Other (434) (487) (767) (923)
(327,021) (144,259) (551,867) (217,006)
Equity in (loss) income of
unconsolidated joint ventures (87) 7,605 (183) 15,076
Minority equity in (income)
loss of consolidated entities (6,652) 12 (10,912) 12
Operating income 50,723 22,092 76,069 29,277
Other income, net 1,300 1,244 1,705 2,320
Income before provision for
income taxes 52,023 23,336 77,774 31,597
Provision for income taxes (20,875) (9,544) (31,217) (12,923)
Net income $ 31,148 $ 13,792 $ 46,557 $ 18,674
Earnings per common share
Basic $ 3.16 $ 1.40 $ 4.74 $ 1.91
Diluted $ 3.14 $ 1.38 $ 4.70 $ 1.87
WILLIAM LYON HOMES
CONSOLIDATED BALANCE SHEETS
(in thousands except number of shares and par value per share)
June 30, December 31,
2004 2003
(unaudited)
ASSETS
Cash and cash equivalents $ 28,117 $ 24,137
Receivables 32,339 46,211
Real estate inventories 1,163,217 698,047
Investments in and advances to unconsolidated
joint ventures 19,991 45,613
Property and equipment, less accumulated
depreciation of $6,969 and $6,517 at June 30,
2004 and December 31, 2003, respectively 17,219 1,625
Deferred loan costs 11,859 9,041
Goodwill 5,896 5,896
Other assets 18,367 19,036
$1,297,005 $849,606
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $ 58,013 $ 35,697
Accrued expenses 81,171 92,636
Notes payable 265,362 80,331
10 3/4% Senior Notes due April 1, 2013 246,523 246,406
7 1/2% Senior Notes due July 1, 2014 150,000 -
801,069 455,070
Minority interest in consolidated entities 193,353 142,496
Stockholders' equity
Common stock, par value $.01 per share;
30,000,000 shares authorized; 9,887,736 and
9,787,440 shares issued and outstanding at
June 30, 2004 and December 31, 2003,
respectively 99 98
Additional paid-in capital 110,803 106,818
Retained earnings 191,681 145,124
302,583 252,040
$1,297,005 $849,606
WILLIAM LYON HOMES
SUPPLEMENTAL FINANCIAL INFORMATION
(dollars in thousands)
(unaudited)
UNCONSOLIDATED JOINT VENTURE INFORMATION
The Company and certain of its subsidiaries are general partners or
members in joint ventures involved in the development and sale of
residential projects. The consolidated financial statements of the
Company include the accounts of the Company, all majority-owned and
controlled subsidiaries and certain joint ventures which have been
determined to be variable interest entities in which the Company is
considered the primary beneficiary (see above). The financial
statements of joint ventures which have not been determined to be
variable interest entities in which the Company is considered the
primary beneficiary are not consolidated with the Company's financial
statements. The Company's investments in unconsolidated joint ventures
are accounted for using the equity method. Condensed combined
statements of income for these joint ventures for the three and six
months ended June 30, 2004 and 2003 are summarized as follows:
CONDENSED COMBINED STATEMENTS OF INCOME
(dollars in thousands)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
Operating revenue
Home sales $ - $ 69,978 $ - $ 139,339
Land sale - 8,440 - 8,440
- 78,418 - 147,779
Operating costs
Cost of sales--homes - (53,884) - (107,677)
Cost of sales--land - (8,132) - (8,132)
Sales and marketing (21) (2,052) (21) (4,095)
Operating (loss) income (21) 14,350 (21) 27,875
Other expense, net (153) (409) (345) (200)
Net (loss) income $ (174) $ 13,941 $ (366) $ 27,675
Allocation to owners
William Lyon Homes $ (87) $ 7,605 $ (183) $ 15,076
Others (87) 6,336 (183) 12,599
$ (174) $ 13,941 $ (366) $ 27,675
WILLIAM LYON HOMES
SUPPLEMENTAL FINANCIAL INFORMATION
SELECTED FINANCIAL DATA (dollars in thousands except per share data):
Last Twelve
Three Months Ended Months Ended
June 30, June 30,
2004 2003 2004 2003
Net income $ 31,148 $ 13,792 $ 100,020 $ 58,040
Net cash used in operating
activities $(38,685) $(78,353) $(219,276) $(81,443)
Interest incurred (1) $ 15,238 $ 12,383 $ 54,240 $ 37,762
Adjusted EBITDA (2) $ 67,275 $ 33,413 $ 228,742 $106,003
Ratio of adjusted EBITDA to 4.22x 2.81x
interest incurred
(1) Interest incurred for the three and twelve months ended June 30,
2004 includes $2,301,000 of interest related to debt of
consolidated entities which totaled $100,193,000 at June 30, 2004,
due to the adoption of Financial Accounting Standards Board
Interpretation No. 46, Consolidation of Variable Interest
Entities, as amended.
(2) Adjusted EBITDA means net income plus (i) provision for income
taxes, (ii) interest expense, (iii) amortization of capitalized
interest included in cost of sales, (iv) depreciation and
amortization and (v) cash distributions of income from
unconsolidated joint ventures less equity in income of
unconsolidated joint ventures. Other companies may calculate
adjusted EBITDA differently. Adjusted EBITDA is not a financial
measure prepared in accordance with generally accepted accounting
principles. Adjusted EBITDA is presented herein because it is a
component of certain covenants in the indentures governing the
Company's 10 3/4% Senior Notes and 7 1/2% Senior Notes
("Indentures"). In addition, management believes the presentation
of adjusted EBITDA provides useful information to the Company's
investors regarding the Company's financial condition and results
of operations because adjusted EBITDA is a widely utilized
financial indicator of a company's ability to service and/or incur
debt. The calculations of adjusted EBITDA below are presented in
accordance with the requirements of the Indentures. Adjusted
EBITDA should not be considered as an alternative for net income,
cash flows from operating activities and other consolidated income
or cash flow statement data prepared in accordance with accounting
principles generally accepted in the United States or as a measure
of profitability or liquidity. A reconciliation of net income to
adjusted EBITDA is provided as follows:
Last Twelve
Three Months Ended Months Ended
June 30, June 30,
2004 2003 2004 2003
Net income $ 31,148 $ 13,792 $100,020 $ 58,040
Provision for income taxes 20,875 9,544 70,109 27,690
Interest expense:
Interest incurred 15,238 12,383 54,240 37,762
Interest capitalized (15,238) (12,383) (54,240) (37,762)
Amortization of capitalized
interest in cost of sales 14,938 5,038 53,022 26,892
Depreciation and amortization 227 280 901 1,370
Cash distributions of income from
unconsolidated joint ventures - 12,364 20,667 29,327
Equity in (loss) income of
unconsolidated joint ventures 87 (7,605) (15,977) (37,316)
Adjusted EBITDA $ 67,275 $ 33,413 $228,742 $106,003
A reconciliation of net cash used in operating activities to adjusted
EBITDA is provided as follows:
Last Twelve
Three Months Ended Months Ended
June 30, June 30,
2004 2003 2004 2003
Net cash used in operating
activities $(38,685) $(78,353) $(219,276) $(81,443)
Interest expense:
Interest incurred 15,238 12,383 54,240 41,537
Interest capitalized (15,238) (12,383) (54,240) (41,537)
Amortization of capitalized
interest in cost of sales 14,938 5,038 53,022 26,892
Cash distributions of income
from unconsolidated joint
ventures - 12,364 20,667 29,327
Minority equity in (income)
loss of consolidated entities (6,652) 12 (11,353) 12
Net changes in operating
assets and liabilities:
Receivables (3,643) (1,607) 13,896 8,224
Real estate inventories 99,097 118,687 314,591 135,245
Deferred loan costs (146) 714 248 6,682
Other assets (1,460) 121 1,135 (1,721)
Accounts payable (7,357) (16,160) (839) (15,651)
Accrued expenses 11,183 (7,403) 56,651 (1,564)
Adjusted EBITDA $ 67,275 $ 33,413 $ 228,742 $106,003
SOURCE: William Lyon Homes
William Lyon Homes
W. Douglass Harris (Investors), 949-833-3600
tities, as amended, as described below.
