STATEMENT OF MAYNARD C. ANDERSON DIRECTOR FOR SECURITY PLANS AND PROGRAMS OFFICE OF THE UNDER SECRETARY OF DEFENSE FOR POLICY BEFORE THE COMMERCE, CONSUMER AND MONETARY AFFAIRS SUBCOMMITTEE COMMITTEE ON GOVERNMENT OPERATIONS HOUSE OF REPRES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87S00869R000200110021-0
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 11
• Document Creation Date: December 22, 2016
• Document Release Date: October 18, 2010
• Sequence Number: 21
• Publication Date: April 6, 1982
• Content Type: MISC

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STATEMENT OF
MAYNARD C. ANDERSON
DIRECTOR
FOR
SECURITY PLANS AND PROGRAMS
OFFICE OF THE UNDER SECRETARY OF DEFENSE FOR POLICY
BEFORE THE
COMMERCE., CONSUMER AND MONETARY AFFAIRS SUBCOMMITTEE
COMMITTEE ON GOVERNMENT OPERATIONS
HOUSE OF REPRESENTATIVES
APRIL 6, 1982
GLEAPED
FCR OPEN FIJgkICA1104
'APR 0 2192 21
BORATE FOR FREEDOM Of INFORAMTi,'1~1
ANO SECURITY REVIEW (DASD-PA)
DEPARTMENY OF *fFNSF
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MR. CHAIRMAN AND MEMBERS OF THE. COMMITTEE: MY NAME IS MAYNARD C.
ANDERSON AND I WOULD LIKE TO EXPRESS MY APPRECIATION FOR THE OPPORTUNI"
TO APPEAR HERE THIS MORNING ON BEHALF OF GENERAL RICHARD G. STILWELL,
(RET.), THE DEPUTY UNDER SECRETARY-OF DEFENSE FOR POLICY. GENERAL
STILWELL IS RESPONSIBLE FOR ESTABLISHING THE DEFENSE INDUSTRIAL
SECURITY PROGRAM POLICY. I AM THE DIRECTORJFOR SECURITY PLANS AND
PROGRAMS"UNDER GENERAL STILWELL. MY DIRECTORATE IS RESPONSIBLE
FOR DEVELOPING THE INDUSTRIAL SECURITY POLICY SUBJECT TO MY
APPEARANCE HERE TODAY; NAMELY, THOSE POLICIES PERTAINING TO CLEARED
U.S. FACILITIES OR THOSE IN-PROCESS FOR A CLEARANCE WHICH COME
UNDER;SOME DEGREE OF FOREIGN OWNERSHIP, CONTROL, OR INFLUENCE.
THE DEFENSE. INVESTIGATIVE SERVICE IS RESPONSIBLE FOR THE ADMINISTRA-
TION OF THE DEFENSE INDUSTRIAL SECURITY PROGRAM. As YOU MAY RECALL,
THE DIRECTOR, DEFENSE INVESTIGATIVE SERVICE PROVIDED THIS SUBCOMMITTEE
WITH AN OVERVIEW OF OUR FOCI POLICY IN FORMAL TESTIMONY THIS PAST
NOVEMBER. HOWEVER, MY TESTIMONY THIS MORNING WILL FOCUS ON THE DIS
ROLE IN IMPLEMENTING OUR FOREIGN OWNERSHIP, CONTROL OR INFLUENCE
POLICY WITH PARTICULAR EMPHASIS ON ITS APPLICATION CONCERNING THE
WHITTAKER CORPORATION.
I HAVE HERE WITH ME MR. RICHARD ANDERSON. MR. ANDERSON IS THE SENIOR
STAFF SPECIALIST AT DIS HEADQUARTERS IN THE. AREA OF FOCI AND BRINGS
WITH HIM DETAILED KNOWLEDGE OF THE DIS HANDLING OF THE WHITTAKER
CASE.
MR. CHAIRMAN, WITH YOUR PERMISSION I WOULD LIKE TO READ.A PREPARED
STATEMENT.
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THE DEPARTMENT OF DEFENSE HAS DEVELOPED OVER THE YEARS A COMPREHENSIVE
INDUSTRIAL SECURITY PROGRAM DESIGNED TO SAFEGUARD CLASSIFIED
INFORMATION RELEASED TO INDUSTRY. THE CURRENT AUTHORITY FOR THE
PROGRAM IS EXECUTIVE ORDER 10865, ENTITLED "SAFEGUARDING CLASSIFIED
INFORMATION WITHIN INDUSTRY," DATED FEBRUARY 20, 1960. AN INTEGRAL
PART OF THE DEFENSE INDUSTRIAL SECURITY PROGRAM IS A SYSTEM THAT IS
DESIGNED TO REASONABLY INSURE THAT CLEARED CONTRACTORS ARE NOT
AFFECTED BY FOREIGN OWNERSHIP,. CONTROL, OR INFLUENCE (FOCI) TO AN
EXTENT WHICH WOULD BE INIMICAL TO. OUR NATLONAL SECURITY. WHEN
THE NATURE AND EXTENT OF FOREIGN OWNERSHIP, CONTROL OR INFLUENCE
.IS SUCH THAT A REASONABLE BASIS EXISTS FOR CONCLUDING THAT THE SECURIT'
OF CLASSIFIED INFORMATION MAY BE JEOPARDIZED IF A FACILITY SECURITY
CLEARANCE IS GRANTED OR CONTINUED, THE AFFECTED CONTRACTOR IS
CONSIDERED TO BE UNDER FOCI. As SUCH, IT WOULD BE INELIGIBLE
FOR ACCESS TO. CLASSIFIED INFORMATION AND A FACILITY SECURITY CLEARANCE
WOULD NOT BE GRANTED OR IT WOULD BE SUBJECT TO REVOCATION, AS
APPROPRIATE.
AT THIS POINT, I FEEL IT WOULD BE HELPFUL TO PROVIDE YOU WITH A BRIEF
OVERVIEW OF THE FACILITY SECURITY CLEARANCE PROCESS, TO INCLUDE THE
MANNER IN WHICH THE DEFENSE DEPARTMENT COMES BY INFORMATION DENOTING
FOREIGN INVOLVEMENT.
UNDER THE DEFENSE INDUSTRIAL SECURITY PROGRAM, CLASSIFIED INFORMA-
TION CANNOT BE-RELEASED TO ANY EMPLOYEE OR MANAGEMENT OFFICIAL
UNTIL THE FIRM IS'GRANTED A FACILITY SECURITY CLEARANCE. THIS
NECESSITATES THE SECURITY CLEARING OF KEY MANAGEMENT OFFICIALS PRIOR
TO THE ISSUANCE OF THE FACILITY CLEARANCE. IT IS DOD POLICY THAT A
FIRM OR INDIVIDUAL BE PROCESSED FOR A SECURITY CLEARANCE ONLY
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WHEN A NEED FOR ACCESS TO CLASSIFIED INFORMATION CAN BE ESTABLISHED.
A CLEARANCE BASED ON THIS NEED REQUIRES THAT A PROSPECTIVE CLASSIFIED
CONTRACTOR BE SPONSORED BY A GOVERNMENT ACTIVITY OR A CLEARED
CONTRACTOR WHO WISHES TO UTILIZE THE SERVICES OF THE PROSPECTIVE
CONTRACTOR IN A CAPACITY REQUIRING ACCESS TO CLASSIFIED INFORMA-
TION. THIS REQUIREMENT INSURES THAT, INVESTIGATIVE RESOURCES ARE
NOT UNNECESSARILY EXPENDED AND PREVENTS ISSUANCE OF A CLEARANCE WHEN
NO VALID NEED FOR ACCESS TO: CLASSIFIED INFORMATION EXISTS.
WHEN A FACILITY IS INITIALLY PROCESSED BY DIS FOR A SECURITY
CLEARANCE, MANAGEMENT IS REQUIRED TO COMPLETE A DD FORt.1 441s
ENTITLED, "CERTIFICATE PERTAINING TO FOREIGN INTERESTS." THIS
FORM SOLICITS INFORMATION REGARDING A FIRMS FOREIGN INVOLVEMENT.
QUESTIONS COVER SUCH MATTERS AS FOREIGN OWNED STOCK; STOCK HELD IN
"STREET NAMES;" FOREIGN INTERESTS WHO SERVE AS OFFICERS OR DIRECTORS
OR WHO CONTROL THE APPOINTMENT OR TENURE OF OFFICERS. OR DIRECTORS.
FOREIGN SUBSIDIARIES OR AFFILIATES MUST BE NAMED AND INDIVIDUALS
IDENTIFIED WHO SERVE AS OFFICERS/DIRECTORS WITH BOTH FIRMS.
CONTRACTORS MUST DESCRIBE LICENSING, PATENT EXCHANGE, MARKETING
JOINT VENTURES OR SIMILAR ARRANGEMENTS WITH FOREIGN INTERESTS WHICH
INVOLVE THEIR PRODUCTS OR SERVICES.
IN ADDITION, THE CONTRACTOR MUST PROVIDE DATA ON..INCOME RECEIVED
FROM FOREIGN SOURCES. IN EXCESS OF TEN PERCENT OF THE ANNUAL GROSS
INCOME. FINALLY, INFORMATION IS REQUIRED ON INDEBTEDNESS TO FOREIGN
INTERESTS.
rN ADDITION. TO FILING AN INITIAL DD FORM 441s, A CONTRACTOR MUST
NOTIFY THE GOVERNMENT OF CHANGES IN THE INFORMATION PREVIOUSLY FURNISHI
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OR WHEN THE FIRM IS ENGAGED IN PRELIMINARY DISCUSSIONS WITH FOREIGN
INTERESTS WHICH MIGHT BE EXPECTED TO RESULT IN A CHANGE TO THE DD 4415
DURING SUBSEQUENT INSPECTIONS OF THE FACILITY, THE DIS INDUSTRIAL
SECURITY REPRESENTATIVES REVIEW THE DD 441s WITH APPROPRIATE OFFICIALS
OF THE FIRM TO DETERMINE WHETHER CHANGES HAVE TAKEN PLACE. ALTHOUGH
THE CONTRACTOR IS THE PRIMARY SOURCE OF INFORMATION ON THE. DD 441s
THE DEPARTMENT OF DEFENSE ALSO HAS.ACCESS TO REPORTS FILED: WITH
-;--THE DEPARTMENT?OF= COMMERCE AND THESECURITIES AND EXCHANGE COMMISSION,..
DIS REPRESENTATIVES ALSO REVIEW CONTRACTOR ANNUAL REPORTS AS WELL AS
THE FINANCIAL AND BUSINESS SECTIONS OF VARIOUS PUBLICATIONS. No
MATTER THE SOURCE, THE INFORMATION IS ANALYZED BY DIS AND QUICKLY
ACTED UPON IN ACCORDANCE WITH ESTABLISHED POLICY. HOWEVER, THE ACTION
TAKEN BY DIS IS DEPENDENT UPON THE SOURCE AND NATURE OF THE INFORMA-
TION INVOLVED.
WHENEVER, THERE IS SIGNIFICANT EVIDENCE OF FOCI, THE CONTRACTOR S
FACILITY SECURITY CLEARANCE IS INVALIDATED. A FACILITY WITH AN INVAL.II
CLEARANCE IS INELIGIBLE FOR ACCESS TO ANY NEW OR ADDITIONAL CLASSIFIED
INFORMATION SUBSEQUENT TO THE DATE OF THE INVALIDATION ACTION.
FURTHER, THE PERTINENT GOVERNMENT CONTRACTING ACTIVITIES ARE NOTIFIED
OF THE ACTION AND REQUESTED TO DETERMINE WHETHER THE CONTRACTOR
MAY CONTINUE TO PERFORM ON THE EXISTING CLASSIFIED CONTRACTS.
ONCE A FACILITY CLEARANCE IS INVALIDATED, THE CONTRACTOR HAS THIRTY
DAYS IN WHICH TO ACHIEVE OR INITIATE SATISFACTORY RESOLUTION. MIRING
THE INTERVENING PERIOD, THE CASE IS DISCUSSED IN DETAIL WITH THE
CONTRACTOR AND ITS COUNSEL. IF AFTER THIRTY DAYS THE.FACILITY FAILS
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TO SUBMIT AN ACCEPTABLE PLAN FOR PROMPT AND EFFECTIVE RESOLUTION,
FAILS TO ADHERE TO SUCH A PLAN, OR IS UNABLE OR UNWILLING TO EFFECTIV
DEAL WITH THE PROBLEM, ARRANGEMENTS WOULD BE MADE TO RECOVER THE
CLASSIFIED MATERIAL AND THE FACILITY SECURITY CLEARANCE WOULD BE
SUBJECT TO REVOCATION.
I THINK IT SHOULD BE NOTED THAT OVER THE YEARS U.S. FIRMS HAVE
BEEN ENCOURAGED BY THE GOVERNMENT TO DEVELOP AND EXPAND THEIR*
FOREIGN MARKETS. IT WAS PRIMARILY U.S. INTERESTS WHO WERE THEN
DOING THE INVESTING OVERSEAS. IN RECENT YEARS, EVENTS AND CIRCUM-
STANCES HAVE CHANGED. FOREIGN INTERESTS, WITH SUBSTANTIAL INVEST-
MENT CAPITAL, NOW SEE OPPORTUNITIES TO INVEST IN U.S. INDUSTRY TO
INCREASE THEIR EARNINGS. FURTHER, THE DEFENSE DEPARTMENT SUPPORTS
U.S. CONTRACTOR INVOLVEMENT IN NUMEROUS MULTILATERAL COOPERATIVE
DEFENSE PROJECTS IN SUPPORT OF OUR NATIONAL SECURITY. THEREFORE,
IT IS NOT TERRIBLY UNCOMMON FOR OUR CLEARED DEFENSE CONTRACTORS,
CERTAINLY THE LARGER AND MORE DIVERSIFIED ONES, TO HAVE SOME DEGREE
OF FOREIGN INVOLVEMENT,
THIS FOREIGN INVOLVEMENT OFTEN REACHES REPORTABLE LEVELS REQUIRING
DIS REVIEW. MOST CASES ARE REVIEWED AND ADJUDICATED AT THE DIS
REGIONAL LEVEL. INSTANCES OF MORE SIGNIFICANT FOREIGN INVOLVEMENT
ARE FORWARDED TO DIS HEADQUARTERS FOR DETERMINATION OF CONTINUED
FACILITY SECURITY CLEARANCE ELIGIBILITY. OF THESE, FOUR CATEGORIES
OF FOCI CASES MUST BE REVIEWED PERSONALLY BY THE DIRECTOR, DIS.
THESE CATEGORIES ARE AS FOLLOWS:
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1. FOREIGN INTERESTS OWN OR HAVE OPTIONS TO ACQUIRE STOCK IN
EXCESS OF 20 PERCENT.
2. STOCK OWNERSHIP BY FOREIGN INTERESTS WHERE A VOTING TRUST
AGREEMENT, PROXY AGREEMENT.. ; OR BOARD RESOLUTION IS NECESSARY TO
EFFECTIVELY INSULATE THE CLEARED FACILITY.
3. FOREIGN INDEBTEDNESS. EXISTS AMOUNTING TO 15 PERCENT OR MORE
OF THE CURRENT ASSETS OF THE CORPORATION, OR WHERE OVER 20 PERCENT
OF THE STOCK IN THE U.S. CORPORATION HAS BEEN PLEDGED TO A FOREIGN
INTEREST AS COLLATERAL.
4. MORE THAN FIVE PERCENT INCOME IS DERIVED FROM COMMUNIST
COUNTRIES.
I WOULD NOW LIKE TO DESCRIBE THE PRIMARY FOREIGN OWNERSHIP, CONTROL,
OR INFLUENCE FACTORS PERTINENT TO THE WHITTAKER CORPORATION AND THE
RATIONALE USED BY THE DEFENSE INVESTIGATIVE SERVICE IN FAVORABLY
ADJUDICATING THIS CASE.
THE WHITTAKER CORPORATION IS A PUBLICLY OWNED FIRM INCORPORATED IN
THE STATE OF CALIFORNIA. WHITTAKER IS CLEARED TOP SECRET AND WAS
PERFORMING ON APPROXIMATELY 33 CLASSIFIED CONTRACTS AS OF FEBRUARY
OF THIS YEAR. A LIST OF THESE CONTRACTS HAVE BEEN FURNISHED TO
THIS COMMITTEE.
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ALTHOUGH THE WHITTAKER CORPORATION SUBMITTED INFORMATION SUFFICIENT
ENOUGH TO WARRANT DIS REVIEW AND DETERMINATION IN THE PAST, IT
WASN'T UNTIL JANUARY 1979 THAT ITS FOREIGN INVOLVEMENT BECAME A
MATTER OF SPECIAL CONCERN TO DIS. THE DD FORM 441s SUBMITTED BY
WHITTAKER AT THAT TIME REFLECTED STOCK OWNERSHIP BY OLAYAN INVESTMENTS
COMPANY ESTABLISHMENT, A LIECHTENSTEIN CORPORATION OWNED BY
-MR. SULIMAN S.. OLAYAN, A SAUDI ARABIAN NATIONAL. IF A FOREIGN
ENTITY OWNS A SIGNIFICANT PORTION OF A COMPANY, THE ABILITY TO
INFLUENCE OR CONTROL IS PRESUMED TO EXIST. GENERALLY SPEAKING, THIS
OWNERSHIP WILL BE MANIFEST BY THE APPOINTMENT OF OFFICERS OR DIRECTORS
IF OFFICERS OR DIRECTORS ARE APPOINTED BY A FOREIGN OWNER, OR THE
FOREIGN OWNER HAS THE ABILITY TO APPOINT OFFICERS OR DIRECTORS
AT HIS DISCRETION, THEN ONCE AGAIN, CONTROL AND INFLUENCE MUST BE
PRESUMED. HOWEVER,. IN THE CASE OF WHITTAKER, THE PERTINENT
FACTS WERE FULLY REVIEWED BY DIS AND A FAVORABLE DECISION WAS
RENDERED. THAT PARTICULAR DECISION WAS BASED, IN PART, ON THE FACT
THAT THE VOTING POWER OF THE FOREIGN OWNED STOCK WAS INSUFFICIENT
TO ELECT REPRESENTATION TO THE WHITTAKER CORPORATION BOARD OF
DIRECTORS.
THE MOST RECENT FOCI EVALUATION BY DIS WAS RENDERED IN JULY 1981.
AT THAT TIME, MR. OLAYAN OWNED 5.1% OF THE WHITTAKER STOCK. THIS
AMOUNT CONTINIED TO BE INSUFFICIENT TO ELECT A MEMBER TO WHITTAKER'S
BOARD OF DIRECTORS, ALSO REVIEWED AT THE TIME WAS A WHITTAKER
B.OARD RESOLUTION WHICH ACKNOWLEDGED THE FOREIGN OWNERSHIP AND REITERATI
THE FIRM'S SECURITY OBLIGATIONS UNDER THE INDUSTRIAL SECURITY
PROGRAM. THIS RESOLUTION HAD BEEN PREVIOUSLY REQUESTED BY DIS.
A BOARD RESOLUTION MAY BE. USED TO MITIGATE FOREIGN OWNERSHIP UNDER
THE FOLLOWING CONDITIONS:
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1. THE PERCENTAGE OF VOTING STOCK OWNED BY FOREIGN INTERESTS
IS NOT MORE THAN 15%.
2. THE AMOUNT OF STOCK OWNED BY THE FOREIGN INTERESTS IS NOT
SUFFICIENT TO ELECT REPRESENTATION TO THE BOARD.
3... -THERE IS NO AGREEMENT WHEREBY THE FOREIGN INTEREST IS
EERMITTED TO HAVE REPRESENTATION ON THE BOARD.
4. THE DEPUTY DIRECTOR (INDUSTRIAL SECURITY), HO DIS,
MAKES A DETERMINATION THAT, BASED ON ALL OF THE AVAILABLE FACTS,
A BOARD RESOLUTION REPRESENTS A SATISFACTORY RESOLUTION OF THE
CASE.
IF ANY ONE OF THE AFOREMENTIONED CONDITIONS CANNOT BE SATISFIED,
EITHER A VOTING TRUST OR PROXY AGREEMENT WOULD HAVE TO BE PLACED
INTO EFFECT OR THE CLEARED FIRM S FACILITY CLEARANCE WOULD BE
SUBJECT TO REVOCATION.
ALSO EVALUATED IN 1981 WAS WHITTAKER CORPORATIONS INCOME FROM
WHITTAKER SAUDI ARABIA, LTD. THIS FIRM PROVIDES HEALTH CARE SERVICES
IN SAUDI. ARABIA AND IS 70 PERCENT OWNED BY THE WHITTAKER CORPORA-
TION. TOTAL REPORTED SALES TO SAUDI ARABIA CONSTITUTED 13.E PERCENT
OF THE CONSOLIDATED SALES OF WHITTAKER,s
THE WHITTAKER CORPORATION FORM 10-K FOR THE FISCAL YEAR ENDED
OCTOBER 31, 1981, INDICATED THAT THE. SAUDI ARABIAN INCOME HAD
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INCREASED TO APPROXIMATELY $278 MILLION OR 16.62 PERCENT OF VHITTAKER
CONSOLIDATED SALES FOR THAT PERIOD, DTS EVALUATES INCOME FROM
FOREIGN SOURCES IN CONJUNCTION WITH ALL OTHER FACTORS PRESENT IN A
PARTICULAR CASE. AN ADVERSE DECISION WOULD BE APPROPRIATE
FOCI FACTORS PROVIDE A REASONABLE BASIS FOR A CONCLUSION T
COMPROMISE OF CLASSIFIED INFORMATION MAY RESULT. IN CASES WHERE
INCOME IS'THE ONLY FACTOR, AN ADVERSE DECISION WOULD BE REASONABLE
IF A FIRM DERIVED A SUBSTANTIAL PERCENTAGE OF ITS GROSS INCOME
FROM COMMUNIST COUNTRIES, OR FROM COUNTRIES WHICH ARE OVERTLY
HOSTILE TO THE UNITED STATES. THE AFOREMENTIONED INCOME
FIGURE DOES NOT INDICATE FINANCIAL DEPENDENCE ON THE KINGDOM OF
SAUDI.. ARABIA NOR IS SAUDI ARABIA CONSIDERED HOSTILE TO THE UNITED ST1(4-
THE FOREGOING REPRESENTS AN OVERVIEW OF THE APPLICATION OF OUR FOCI
POLICY AS CONCERNS THE.WHITTAKER CORPORATION. WHITTAKER HAS BEEN
FULLY COOPERATIVE AND OPEN IN ITS DEALINGS WITH DIS ON THESE
MATTERS. THE FIRM IS PRESENTLY ASSEMBLING A NEW 41115 FOR REEVALUA-
TION AT THE REQUEST OF DIS.
IN CONCLUSION, I WOULD LIKE TO EMPHASIZE THAT OUR FOCI POLICY
AND. ITS ATTENDANT PRACTICES AND PROCEDURES OFFER EFFECTIVE
PROTECTION FOR OUR CLASSIFIED INFORMATION. HOWEVER, IT IS NOT
FOOLPROOF AND CANNOT GUARANTEE THAT UNAUTHORIZED DISCLOSURES WILL
NOT OCCUR. THIS IS= A GOAL WHICH IS. SIMPLY NOT ATTAINABLE. HOWEVER,
WE ARE CONTINUOUSLY EVALUATING THE POLICY TO INSURE THAT IT IS
NEITHER UNREASONABLY STRINGENT NOR IRRESPONSIBLY WEAK AND
INEFFECTIVE.
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NONETHELESS, WE SHARE THIS COMMITTEE'S CONCERN RELATIVE TO PROBLEMS
ASSOCIATED WITH BENEFICIAL OWNERS OF STOCK HELD IN STREET NAMES
AND NOMINEE ACCOUNTS. CONTRACTORS ARE REQUIRED TO IDENTIFY
ALL KNOWN FOREIGN STOCK OWNERSHIP, ABOVE THE 5% REPORTING THRESHOLD,
REGARDLESS OF THE MANNER IN WHICH THE STOCK IS REGISTERED. THIS -
DISCLOSURE IS MADE UNDER THE CRIMINAL PENALTIES FOR MISREPRESENTA-
TION PRESCRIBED IN 18 U.S. CODE, SECTION 1001. SHOULD A PREVIOUSLY
UNKNOWN FOREIGN INVESTOR SUBSEQUENTLY ATTEMPT TO EXERT INFLUENCE
OR GAIN REPRESENTATION ON THE CORPORATIONS BOARD OF DIRECTORS,
THE CONTRACTOR WOULD BE OBLIGATED TO REPORT THE SITUATION AT THAT
TIME. THE DOD FOCI POLICY WOULD THEN BE APPLIED. THE DEFENSE
INVESTIGATIVE SERVICE.RESPECTS THE CONFIDENTIALITY OF THE RELATIONSHIP
BETWEEN STOCKHOLDERS AND THEIR BANKERS OR BROKERS TO THE EXTENT
THAT THIS CONFIDENTIALITY IS IN ACCORD WITH DISCLOSURE POLICY OF
THE SECURITIES AND EXCHANGE COMMISSION,. WE WOULD WELCOME
REGULATORY CHANGES OR LEGISLATION WHICH WOULD PERMIT DIS ACCESS
TO THE IDENTITY OF SUCH BENEFICIAL STOCKHOLDERS.
MR. RICHARD ANDERSON AND I ARE NOW PREPARED TO ANSWER ANY QUESTIONS
YOU MAY HAVE.
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