10-Q 1 file001.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 0R 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended December 31, 2003 Commission File Number 0-1437 -------------------------------------------------------------------------------- THE FIRST REPUBLIC CORPORATION OF AMERICA -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 13-1938454 -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 302 Fifth Avenue, New York, NY 10001 -------------------------------------------------------------------------------- (Address of principal executive office) (Zip Code) Registrant's telephone number, including area code (212) 279-6100 -------------------------------------------------------------------------------- Former name, former address and former fiscal year, if changed since last report: Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Sections 13 and 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days: Yes No X ------ ------ Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 under the Securities Exchange Act of 1934). Yes No X --------- ------ As of May 20, 2004, there were 666,616 shares of common stock outstanding. PART 1. FINANCIAL INFORMATION THE FIRST REPUBLIC CORPORATION OF AMERICA AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS

NOTE: THE BALANCE SHEET AT JUNE 30, 2003 HAS BEEN DERIVED FROM THE AUDITED FINANCIAL STATEMENTS AT THAT DATE AND CONDENSED. SEE NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS THE FIRST REPUBLIC CORPORATION OF AMERICA AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED

SEE NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS THE FIRST REPUBLIC CORPORATION OF AMERICA AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

SEE NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS THE FIRST REPUBLIC CORPORATION OF AMERICA AND SUBSIDIARIES NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2003 (UNAUDITED) 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States 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. Operating results for the six month period ended December 31, 2003 are not necessarily indicative of the results that may be expected for the year ended June 30, 2004. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended June 30, 2003. Certain 2002 amounts have been reclassified to conform with the 2003 presentation. 2. INVENTORIES DECEMBER 31, JUNE 30, 2003 2003 ---- ---- Work-in process and raw materials $ 1,244,209 $ 1,206,510 Finished goods 3,319,025 6,282,723 ------------- ------------- $ 4,563,234 $ 7,489,233 ------------ ------------ 3. INCOME TAXES SIX MONTHS ENDED DECEMBER 31, 2003 2002 ---- ---- Federal $(1,336,000) $ 50,000 State 200,000 200,000 ------------ -------- $(1,136,000) $250,000 ------------ -------- 4. EARNINGS PER SHARE Earnings per share are based upon the weighted average shares outstanding. The Company does not have any dilutive securities. 5. COMPREHENSIVE LOSS Comprehensive loss for the six months ended December 31, 2003 totaled $5,650,351 and was comprised of net loss of $5,766,875 and other comprehensive income of $116,524 related to the changes in the fair value of a derivative swap instrument the Company entered into as a cash flow hedge in connection with its term loan. For the six months ended December 31, 2003, the Company had no items of other comprehensive income or loss requiring additional disclosure. THE FIRST REPUBLIC CORPORATION OF AMERICA AND SUBSIDIARIES NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 6. INDUSTRY SEGMENTS SIX MONTHS ENDED DECEMBER 31, 2003 2002 ------------ ------------ REVENUES: REAL ESTATE $ 7,182,164 $ 7,320,334 HOTEL 3,377,019 3,547,750 SEAFOOD 7,363,936 12,691,552 TEXTILE 4,632,752 4,549,727 CORPORATE AND OTHER 3,877 9,971 ------------ ------------ $ 22,559,748 $ 28,119,334 ============ ============ OPERATING (LOSS) PROFIT: REAL ESTATE $ 2,050,636 $ 2,140,823 HOTEL 295,854 319,287 SEAFOOD (5,772,221) (1,624,145) TEXTILE 25,621 25,064 ------------ ------------ TOTAL OPERATING (LOSS) PROFIT (3,400,110) 861,029 CORPORATE EXPENSES (1,903,967) (1,872,852) CORPORATE INTEREST EXPENSE (245,639) (260,140) CORPORATE REVENUE 3,387 9,971 WRITE OFF OF AMOUNT DUE FROM MINORITY INTEREST (2,055,000) -- EQUITY IN LOSS OF AFFILIATED ENTITIES (689,756) (476,353) MINORITY INTERESTS' SHARE OF LOSS OF SUBSIDIARIES 1,388,210 924,668 ------------ ------------ LOSS BEFORE INCOME TAXES $ (6,902,875) $ (813,677) ============ ============ THE FIRST REPUBLIC CORPORATION OF AMERICA AND SUBSIDIARIES NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS CONTINUED SIX MONTHS ENDED DECEMBER 31, 2003 2002 ------------ ------------ IDENTIFIABLE ASSETS: REAL ESTATE $ 31,345,013 $ 32,327,579 HOTEL 3,218,657 4,011,376 SEAFOOD 29,875,037 34,815,190 TEXTILE 6,887,798 7,886,357 CORPORATE 23,789,930 24,317,829 ------------ ------------ $ 95,116,435 $103,358,331 ============ ============ DEPRECIATION AND AMORTIZATION: REAL ESTATE $ 909,564 $ 921,918 HOTEL 407,652 403,788 SEAFOOD 260,967 270,671 TEXTILE 225,913 238,485 CORPORATE AND OTHER . 18,740 36,062 ------------ ------------ $ 1,822,836 $ 1,870,924 ============ ============ CAPITAL EXPENDITURES - NET: REAL ESTATE $ 302,212 $ 1,544,771 HOTEL 65,828 31,593 SEAFOOD 969,326 595,548 TEXTILE 53,292 158,752 CORPORATE AND OTHER . 1,986 10,344 ------------ ------------ $ 1,392,644 $ 2,341,008 ============ ============ GEOGRAPHIC INFORMATION: REVENUES UNITED STATES $ 22,036,318 $ 27,795,982 ECUADOR 523,430 323,352 ------------ ------------ $ 22,559,748 $ 28,119,334 ============ ============ IDENTIFIABLE ASSETS: UNITED STATES $ 67,318,435 $ 76,046,331 ECUADOR 27,798,000 27,312,000 ------------ ------------ $ 95,116,435 $103,358,331 ============ ============ Results of operations are shown in Managements Discussion and Analysis of Financial Condition and Results of Operations. THE FIRST REPUBLIC CORPORATION OF AMERICA AND SUBSIDIARIES NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 7. OTHER MATTERS The Company has recorded a $5,005,000 loss for the apparent theft of inventory, advances due from inventory suppliers and other receivables, relating to the domestic seafood operations of Bluepoints Company, Inc. ("Bluepoints"), its 80.2% subsidiary. Of the total loss provision (i) $2,340,000 relates to the apparent theft of approximately 160,000 lbs. of lobster tails which were in the possession and control of a joint venture partner/sales agent of Bluepoints, (ii) $1,607,000 relates to advances made by Bluepoints to this joint venture partner/sales agent for new lobster tails and shrimp inventory, (iii) $630,000 relates to other receivables due from this joint venture partner/sales agent and, (iv) $428,000 relates to a markdown of Bluepoints' remaining lobster tail inventory. Bluepoints has terminated its relationship with the joint venture partner/sales agent and has referred the matter to law enforcement authorities. Bluepoints has filed a notice of a claim with its insurer with respect to its loss but has not yet filed a proof of loss. Bluepoints presently expects to file a proof of loss for approximately $3,697,000. Bluepoints' insurance carrier has reserved all of its rights with respect to the claim. Any recovery of such amount will be recognized in earnings upon receipt. After giving effect to current and deferred tax benefits related to the loss and the additional amount payable under the Bluepoints Guaranty described below, the Company's net loss in the quarter attributable to the events described in the preceding paragraph is $2,609,000. Jonathan P. Rosen and the Estate of A.A. Rosen (the "Guarantors") had guaranteed (the "Bluepoints Guaranty") to the Company payment of 19.8% of a series of loans and investments in Bluepoints not funded by the minority owners of Bluepoints. The Estate of A.A. Rosen had also guaranteed (the "Additional Guarantees") repayment of (i) 56.8% of advances, including interest thereon, made by the Company to two Ecuadoran companies engaged in shrimp farming operations in which Bluepoints owns a 38% interest and (ii) 25% of advances, including interest, made by the Company to an Ecuadoran corporation that owns a hatchery that produces post-larval shrimp in which Bluepoints owns a 62.5% interest. The Bluepoints Guaranty , while still in effect with respect to amounts receivable through December 31, 2003, was terminated by the Guarantors effective as of January 1, 2004 with respect to any minority interest amounts originating subsequent to December 31, 2003. The Additional Guarantees remain in effect. The minority owners of Bluepoints have agreed to convey to the Company their interests in Bluepoints for the purpose of partially satisfying obligations due under the Bluepoints Guaranty. As of December 31, 2003 (i) the minority owners share (e.g. 19.8%) of the deficit in Bluepoints' shareholders equity was $11,066,000, $4,110,000 of which represented the minority interests' share of interest that the Company had accrued on its loans to Bluepoints and (ii) approximately $9,597,000, inclusive of interest, was outstanding under the Additional Guarantees. The Guarantors have questioned whether the Bluepoints Guaranty covered the payment of interest. In order to deal with this matter and other issues relating to both guarantees, the Board of Directors established a special committee of the Board for the purpose of (i) determining the value of the minority interests of Bluepoints and the amount of the obligations due under the Bluepoints Guaranty in excess of the value of the minority interests and (ii) negotiating and approving the terms of the consideration to be received by the Company from the Guarantors. After consulting with legal counsel, the committee has concluded that the Bluepoints Guaranty was ambiguous with respect to the payment of interest and has agreed to accept $2,055,000 in settlement of the accrued interest under the Bluepoints Guaranty. The remaining $2,055,000 of accrued interest has been forgiven and written off to expense for the quarter ended December 31, 2003. The Estate of A.A. Rosen has also agreed to satisfy all obligations, including interest, due under the Additional Guarantees promptly after the committee completes its work. The committee has also retained an investment banking firm to render a fairness opinion. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (IN THOUSANDS) The following discussion should be read in conjunction with the accompanying condensed consolidated financial statements of the Company and the notes thereto. FORWARD-LOOKING STATEMENTS Certain statements made in this report may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21B of the Securities Act of 1934, as amended. Such forward-looking statements include statements regarding the intent, belief or current expectations of the Company and its management and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among other things, the following: the ability of the Company to increase production at its Ecuadorian shrimp farms and to address the virus problem that is affecting shrimp production in Ecuador, the availability of scallops in the area covered by the Company's Cape Canaveral, Florida operations, the success of the Company's Polyculture process, Mariculture System, Tolerine product and micro-screening efforts, demand for the Company's textile products and services, and general economic and business conditions, which will, among other things, affect the demand for space and rooms at the Company's real estate and hotel properties, the availability and creditworthiness of prospective tenants, lease rents and terms and availability of financing; and adverse changes in the real estate markets, including, among other things, competition with other companies, risk of real estate development and acquisition, governmental actions and initiatives and environmental safety requirements. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED (IN THOUSANDS) CRITICAL ACCOUNTING POLICIES Management's discussion and analysis of financial condition and results of operations is based upon the Company's consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases its estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The Company believes the following critical accounting policies affect its significant judgments and estimates used in the preparation of its consolidated financial statements. VALUATION OF PROPERTY HELD FOR USE AND SALE On a quarterly basis, the Company reviews the carrying value of both properties held for use and for sale. The Company records impairment losses and reduces the carrying value of properties when indicators of impairment are present and the expected undiscounted cash flows related to those properties are less than their carrying amounts. In cases where the Company does not expect to recover its carrying costs on properties held for use, the Company reduces its carrying cost to fair value, and for properties held for sale, the Company reduces its carrying value to fair value less costs to sell. Management does not believe that the value of any of its properties are impaired as of December 31, 2003. VALUATION OF INVESTMENTS IN AND ADVANCES TO AFFILIATED ENTITIES On a quarterly basis, the Company reviews the carrying value of the investments in and advances to affiliated entities. Although the seafood operations of the Company (particularly the Ecuadorian seafood operations) continue to generate operating losses management believes that the investments that it is currently making will return the operations to profitability. If the Company is unsuccessful in its efforts, an impairment write-down, which may be material, will be required. Management does not believe that the carrying amount of the investments in and advances to affiliated entities are impaired as of December 31, 2003. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED (IN THOUSANDS) RESULTS OF OPERATIONS SIX MONTHS ENDED DECEMBER 31, 2003 AND 2002 Income from operations before income taxes and minority interests decreased $6,553. The components are as follows (DECREASE) 2003 2002 INCREASE ------- ------- ------- Real Estate $ 2,051 $ 2,141 $ (90) Hotel 296 319 (23) Seafood (6,463) (2,100) (4,363) Textiles 26 25 1 Corporate (4,201) (2,123) (2,078) ------- ------- ------- $(8,291) $(1,738) $(6,553) ------- ------- ------- REAL ESTATE Revenues decreased $138 and earnings decreased $90. The decrease in earnings was due to lower revenues offset by lower repair and maintenance costs. HOTEL Revenues decreased $170 over last year and hotel earnings decreased $23 as a result of the lower revenues. SEAFOOD Revenues decreased $5,328 in the current period. Losses continued in the seafood division due primarily to continuing losses in Ecuador due to lower than anticipated shrimp production. Losses in Ecuador were $1,383 this year as compared to last years loss of $1,157 due principally to the continuation of the White Spot Virus in Ecuador that has decimated that country's shrimp production. Scallop operations in Florida earned $47 (including a $175 gain on the sale of a leasehold no longer being used by the company) as compared to a loss last year of $160. Bluepoints domestic operations had a loss of $5,127 as compared to a loss of $783 last year as a result of the seafood inventory related loss discussed in Note 7 of the notes to the condensed consolidated financial statements. TEXTILES As a result of lower operating margins due to increased competition, Hanora Spinning's earnings decreased $133 to $113 for the period. Hanora South and J & M Dyers recognized a combined loss of $87 compared to last year's loss of $141. Whitlock Combing incurred a loss of $80 last year relating to its property in South Carolina which was sold in April 2003. Overall, textile revenues increased $83. CORPORATE/OTHER Corporate expenses, including interest on the Company's term loan and revolving line of credit, increased by $2,078. As discussed in Note 7 of the notes to the condensed consolidated financial statements, $2,055 of accrued interest due from minority owners of Bluepoints Company Inc.has been forgiven and written off to expense. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED (IN THOUSANDS) Results of Operations THREE MONTHS ENDED DECEMBER 31, 2003 AND 2002 Income from operations before income taxes, and minority interests decreased $6,676. The components are as follows (DECREASE) 2003 2002 INCREASE ------- ------- ------- Real Estate $ 879 $ 1,042 $ (163) Hotel 143 129 14 Seafood (5,571) (995) (4,576) Textiles (1) (7) 6 Corporate (3,078) (1,121) (1,957) ------- ------- ------- $(7,628) $ (952) $(6,676) ------- ------- ------- REAL ESTATE Revenues increased $4 and earnings decreased $163, due to higher repairs and maintenance at several properties totaling $147. HOTEL Revenues decreased $88 over last year and hotel earnings increased $14 due to lower operating costs. SEAFOOD Revenues decreased $3,309 in the current period. The high level of loss in the seafood division was principally due to the seafood inventory related loss discussed in Note 7 to the condensed consolidated financial statements and continuing losses in Ecuador due to lower than anticipated shrimp production. Losses in Ecuador were $498 this year as compared to last years loss of $411. Scallop operations in Florida earned $3 as compared to a loss last year of $29. As a result of the aforementioned seafood inventory related losses, Bluepoints domestic operations had a loss of $5,076 as compared to a loss of $555 last year, when the company donated its underwater clam beds to a non-profit corporation in December 2002. TEXTILES Hanora Spinning's earnings decreased $75 to $46. Hanora South and J & M Dyers recognized a combined loss of $47 compared to last years loss of $88. Whitlock Combing incurred a loss of $40 last year relating to its property in South Carolina which was sold in April 2003. Overall, textiles revenues increased $107. CORPORATE/OTHER Corporate expenses, including interest on the Company's term loan and revolving line of credit, increased by $1,957 due to decreased salaries and fringe costs of $70, offset by the write off of $2,055 of accrued interest due from the minority owners of Bluepoints Company Inc. as discussed in Note 7 of the notes to the condensed consolidated financial statements. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - CONTINUED (IN THOUSANDS) LIQUIDITY AND CAPITAL RESOURCES Working capital for the six months ended December 31, 2003 decreased by approximately $6,464 to $3,364. Net cash used in operating activities was approximately $291. Net cash provided by financing activities was approximately $564. Net cash of approximately $1,246 was used in investing activities. The Company borrowed an additional $1,500 during the period from an entity controlled by a major stockholder to finance the importation and sale of lobster tails. The total amount of loans owed to this entity is $4,000. The loans bear interest at prime plus 1% and have no fixed payment terms or maturity dates. The Company's credit agreement with its principal lender provides for a $7,336 term loan with an interest rate of 5.53% per annum and a $3,000 revolving line of credit with an interest rate equal to either (a) LIBOR plus 2% or, (b) the Alternate Base Rate (as defined) plus 0.50%. These loans are also collateralized by a mortgage on the East Newark Industrial Center. The Company and its lender, are currently negotiating a modification to the credit agreement whereby the Company will provide as additional collateral its Liverpool office buildings to facilitate the ongoing compliance with certain financial covenants under the credit agreement. The term loan requires amortization payments of $359 per annum. The term loan matures on October 21, 2007 and the revolving line of credit matures on October 21, 2005. The Company entered into an interest rate swap agreement on January 13, 2003 which fixed the all-in interest rate on the term loan at 5.53% per annum. At December 31, 2003 the term loan balance was $6,947 and $2,750 was outstanding under the revolving line of credit which bore interest at 3.1875% at December 31, 2003. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS THE COMPANY CURRENTLY HAS A VARIABLE RATE TERM LOAN AND A VARIABLE RATE REVOLVING LINE OF CREDIT WHICH HAD OUTSTANDING BALANCES OF APPROXIMATELY $6,947 AND $2,750 RESPECTIVELY, AT DECEMBER 31, 2003. THE TERM LOAN BEARS INTEREST AT THE RATE OF LIBOR PLUS 1.75% AND THE REVOLVING LINE OF CREDIT BEARS INTEREST AT A RATE OF LIBOR PLUS 2.0%. WITH RESPECT TO THE TERM LOAN, THE COMPANY HAS MANAGED ITS EXPOSURE TO CHANGES IN LIBOR THROUGH THE USE OF AN INTEREST RATE SWAP AGREEMENT WHICH EFFECTIVELY FIXES THE INTEREST RATE ON THE TERM LOAN AT 5.53%. WITH RESPECT TO THE REVOLVING LINE OF CREDIT, A 1% INCREASE IN LIBOR WOULD RESULT IN AN INCREASE IN ANNUAL INTEREST EXPENSE OF APPROXIMATELY $28. ITEM 4. CONTROLS AND PROCEDURES a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. THE COMPANY'S CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER HAVE EVALUATED THE EFFECTIVENESS OF THE COMPANY'S DISCLOSURE CONTROLS AND PROCEDURES (AS SUCH TERM IS DEFINED IN RULES #13A-14(C) AND 15D-14(C) UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED ("EXCHANGE ACT") AS OF THE END OF THE PERIOD COVERED BY THIS REPORT. BASED ON SUCH EVALUATION, THE COMPANY'S CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER HAVE CONCLUDED THAT AS OF THE END OF SUCH PERIOD, THE COMPANY'S DISCLOSURE CONTROLS AND PROCEDURES ARE EFFECTIVE. b) INTERNAL CONTROL OVER FINANCIAL REPORTING. THERE HAVE NOT BEEN ANY CHANGES IN THE COMPANY'S INTERNAL CONTROL OVER FINANCIAL REPORTING DURING THE FISCAL QUARTER TO WHICH THIS REPORT RELATES THAT HAVE MATERIALLY AFFECTED, OR ARE REASONABLY LIKELY TO MATERIALLY AFFECT, THE COMPANY'S INTERNAL CONTROL OVER FINANCIAL REPORTING. PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS THERE HAVE BEEN NO MATERIAL LEGAL PROCEEDINGS BEYOND THOSE PREVIOUSLY DISCLOSED IN THE REGISTRANTS FILED ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED JUNE 30, 2003. ITEM 2. CHANGES IN SECURITIES NONE ITEM 3. DEFAULTS UPON SENIOR SECURITIES NONE ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS THE COMPANY'S ANNUAL MEETING OF THE STOCKHOLDERS (THE "MEETING") WAS HELD AT 2:00 P.M. ON DECEMBER 9, 2003. IN CONNECTION WITH THE MEETING, THE COMPANY SOLICITED PROXIES FROM ITS STOCKHOLDERS PURSUANT TO REGULATION 14 OF THE SECURITIES EXCHANGE ACT OF 1934. AT THE MEETING, HARRY BERGMAN, IRVING S. BOBROW, NORMAN A. HALPER, LOUIS NIMKOFF, MIRIAM N. ROSEN, JONATHAN P. ROSEN, WILLIAM M. SILVERMAN AND JANE G. WEIMAN WERE ELECTED TO SERVE AS DIRECTORS OF THE COMPANY UNTIL THE NEXT ANNUAL MEETING OF STOCKHOLDERS IN 2004. IN ADDITION, THE APPOINTMENT OF ERNST & YOUNG AS AUDITORS OF THE COMPANY FOR THE FISCAL YEAR ENDING JUNE 30, 2004 WAS RATIFIED BY THE COMPANY'S STOCKHOLDERS. THE FOLLOWING TABLES SUMMARIZE THE VOTES CAST AT THE MEETING ON THE MATTERS BROUGHT BEFORE THE SHAREHOLDERS: 1. ELECTION OF DIRECTORS NOMINEE NAME VOTES FOR VOTES WITHHELD HARRY BERGMAN 607,832 6,535 IRVING S. BOBROW 607,819 6,548 NORMAN A. HALPER 607,829 6,538 LOUIS NIMKOFF 607,832 6,535 MIRIAM N. ROSEN 607,821 6,546 JONATHAN P. ROSEN 607,829 6,538 WILLIAM M. SILVERMAN 600,061 14,306 JANE G. WEIMAN 607,832 6,535 2. RATIFICATION OF ERNST & YOUNG LLP AS INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS OF THE COMPANY FOR FISCAL YEAR 2004. VOTES FOR VOTES AGAINST VOTES WITHHELD 608,035 5 6,324 ITEM 5. OTHER INFORMATION NONE ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) EXHIBITS: NO. DESCRIPTION 31.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO RULE 13A-14(A)/15D-14(A) OF THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES- OXLEY ACT OF 2002 (FILED HEREWITH) 31.2 CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO RULE 13A-14(A)/15D-14(A) OF THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES- OXLEY ACT OF 2002 (FILED HEREWITH) 32.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 (FILED HEREWITH) 32.2 CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 (FILED HEREWITH) (b) FORM 8-K NO REPORTS ON FORM 8-K WERE REQUIRED TO BE FILED DURING THE PERIOD COVERED BY THIS REPORT. 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. THE FIRST REPUBLIC CORPORATION OF AMERICA REGISTRANT DATE: MAY 25, 2004 /s/ Harry Bergman ----------------------------------------- HARRY BERGMAN PRESIDENT AND TREASURER

FIRST REPUBLIC CORP OF AMERICA 10-Q