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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q

     (Mark One)

Commission File Number: 0-20372

RES-CARE, INC.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (502) 394-2100

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 twelve 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 Noo .

The number of shares outstanding of the registrant’s common stock, no par value, as of July 31, 2002, was 24,417,086.

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INDEX

RES-CARE, INC. AND SUBSIDIARIES

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PART I. FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements

RES-CARE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

See accompanying notes to unaudited condensed consolidated financial statements.

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RES-CARE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

See accompanying notes to unaudited condensed consolidated financial statements.

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RES-CARE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

See accompanying notes to unaudited condensed consolidated financial statements.

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Res-Care, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

June 30, 2002
(Unaudited)

NOTE 1. Basis of Presentation

     Res-Care, Inc. is primarily engaged in the delivery of residential, training, educational and support services to various populations with special needs, including persons with mental retardation and other developmental disabilities and at-risk and troubled youth. All references in these financial statements to “ResCare,” “we,” “us,” or “our” mean Res-Care, Inc. and unless the context otherwise requires, its consolidated subsidiaries.

     The accompanying unaudited condensed consolidated financial statements of ResCare have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X and do not include all information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of financial condition and results of operations for the interim periods have been included. Operating results for the three-month and six-month periods ended June 30, 2002 are not necessarily indicative of the results that may be expected for the year ending December 31, 2002.

     Certain amounts in the 2001 financial statements have been reclassified to conform with the 2002 presentation. Such reclassifications have no effect on previously reported net income.

     For further information, refer to the consolidated financial statements and footnotes thereto in our annual report on Form 10-K for the year ended December 31, 2001.

NOTE 2. Long-term Debt

     Long-term debt consists of the following:

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     On March 22, 2002, we completed an amendment to our $80 million credit facility with a group of banks. The amendment takes into account certain fourth quarter 2001 charges in calculating the financial covenants and includes other changes in determining the borrowing base and the definition of eligible accounts receivable for that determination. Interest rates on borrowings under the facility and the standby letters of credit remain unchanged as a result of this amendment. We are in compliance with our debt covenants as of June 30, 2002.

     Under the provisions of the credit facility, we are required to maintain a minimum ratio of EBITDA to consolidated interest expense (as defined in the credit agreement) throughout the term of the facility. At June 30, 2002, we were in compliance with this minimum requirement. Based on current projections, we believe it is possible that we will not maintain this minimum level as of September 30, 2002. However, we believe, based on discussions with our lenders, that it is probable that the credit agreement will be amended prior to that date and that we will be in compliance with our financial covenants as of September 30, 2002.

     During June 2002, we redeemed $1.4 million of our 6% convertible subordinated notes. The redemption resulted in a pretax gain of approximately $251,000, which is included in other income in the accompanying consolidated statement of income.

     During July 2002, we completed transactions to redeem approximately $3.6 million of our 6% convertible subordinated notes. This redemption will result in a pretax gain of approximately $800,000 in the third quarter of 2002.

NOTE 3. Earnings Per Share

     The following table sets forth the computation of basic and diluted earnings per share:

     The average shares listed below were not included in the computation of diluted earnings per share because to do so would have been antidilutive for the periods presented:

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NOTE 4. Segment Information

     The following table sets forth information about our reportable segments. During 2001, we disclosed information for two reportable operating segments, comprised of Disabilities Services and Youth Services. Effective January 1, 2002, in connection with changes in our management structure, the Youth Services division was split into two segments: (i) Training Services (consisting of the Job Corps operations) and (ii) Youth Services (consisting of all other youth services programs), which were brought under the direction of separate presidents. The information for prior periods presented has been restated to reflect this change.

Note 5. Goodwill and Intangible Assets

     In July 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (Statement) No. 141, Business Combinations, and Statement No. 142, Goodwill and Other Intangible Assets. Statement 141 requires that the purchase method of accounting be used for all business combinations initiated after June 30, 2001 as well as all purchase method business combinations completed after June 30, 2001. Statement 142 requires that goodwill and intangible assets with indefinite useful lives no longer be amortized, but instead be tested for impairment at least annually in accordance with the provisions of Statement 142. In addition, Statement 142 provides that intangible assets with definite lives should be amortized over their useful lives and reviewed for impairment in

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accordance with existing guidelines. We adopted the provisions of Statement 141 upon its issuance in July 2001 and the provisions of Statement 142 effective January 1, 2002. No impairment loss was recognized as a result of the transitional impairment tests required under Statement 142 as of January 1, 2002.

     A summary of changes to goodwill during the year follows:

     Intangible assets are as follows:

     Covenants not to compete are comprised of contractual agreements with stated values and terms and are amortized over the term of the agreements.

     Amortization expense for the six months ended June 30, 2002, was approximately $1.0 million. Estimated amortization expense for the next five years is as follows:

     A reconciliation of net income and diluted earnings per share for the three-months and six-months ended June 30, 2001, as if we had adopted Statement 142 effective January 1, 2001, follows:

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Note 6. Recently Issued Accounting Pronouncements

     In April 2002, the FASB issued Statement No. 145, Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections. Under Statement 145, gains and losses on extinguishments of debt are to be classified as income or loss from continuing operations rather than extraordinary items. Adoption of this Statement is required for fiscal years beginning after May 15, 2002. We have elected to adopt Statement 145 during the second quarter of 2002. Adoption of this Statement resulted in classifying a pretax gain of approximately $251,000 on the redemption of a portion of our 6% convertible subordinated notes as other income in the accompanying Condensed Consolidated Statement of Income for the three months ended June 30, 2002. There were no such extinguishments during the first quarter of 2002.

     In July 2002, the FASB issued Statement 146, Accounting for Costs Associated with Exit or Disposal Activities, which addresses financial accounting and reporting for costs associated with exit or disposal activities. Statement 146 requires that a liability for a cost associated with an exit or disposal activity be recognized when the liability is incurred. This Statement also establishes that fair value is the objective for initial measurement of the liability. Severance pay under Statement 146, in many cases, would be recognized over time rather than up front. The provisions of this Statement are effective for exit or disposal activities that are initiated after December 31, 2002, with early application encouraged. As of this date, there have been no transactions to which Statement 146 would apply.

Note 7. Change in Estimate

     Effective January 1, 2002, we changed our accounting estimates related to depreciation of certain assets. The estimated useful lives of the assets associated with our billing and time and attendance systems were extended four years. Both of these systems are currently being deployed. The change was based on our expected useful lives of the respective systems. As a result of the change, net income for the three months and six months ended June 30, 2002 was increased by approximately $221,000, or $0.01 per diluted share.

Note 8. Contingencies

     In July 2000, American International Specialty Lines Insurance Company, or AISL, filed a Complaint for Declaratory Judgment against us and certain of our subsidiaries in the U.S. District Court for the Southern District of Texas, Houston Division. In the Complaint, AISL sought a declaration of what insurance coverage was available to ResCare in Cause No. 299291-401; In re: Estate of Trenia Wright, Deceased, et al. v. Res-Care, Inc., et al., which was filed in Probate Court No. 1 of Harris County, Texas (the Lawsuit). After the filing, we entered into an agreement with AISL whereby the claims in the Lawsuit were covered under the insurance policies issued by AISL. AISL thereafter settled the Lawsuit for $9 million. It is our position that the Lawsuit initiated coverage under policies of insurance in more than one policy year, thus affording adequate coverage to settle the Lawsuit within coverage and policy limits and that AISL waived any applicable exclusions for punitive damages. On November 23, 2001, a summary judgment was granted in favor of AISL, which was reduced to a final judgment on February 26, 2002. On March 8, 2002, we filed a motion for new trial and to alter judgment which is pending before the trial judge. In our opinion, after consulting with outside trial counsel and special counsel engaged to review the decision, substantial grounds exist for a successful appeal. We have not made any provision in our consolidated financial statements for any potential liability that may result from final adjudication of this matter. We do not believe it is probable that the ultimate resolution of this matter will have a material adverse effect on our consolidated financial condition, results of operations or liquidity.

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     In October 2000, ResCare and one of our subsidiaries, Res-Care Florida, Inc., f/k/a Normal Life Florida, Inc., entered into an agreement with AISL to resolve through binding arbitration a dispute as to the amount of coverage available to settle a lawsuit that had previously been filed in Pinellas County Circuit Court, Florida and subsequently settled after we entered into the agreement. AISL contended that a portion of the settlement reached was comprised of punitive damages and, therefore, not the responsibility of AISL. Our position was that the settlement was an amount that a reasonable and prudent insurer would pay for the actual damages alleged and that AISL had opportunities to settle all claims within available coverage limits. Binding arbitration was held on January 15 and 16, 2002, and on February 14, 2002, a decision was entered in our favor stating that the underlying settlement was within the coverage limits of our policy and also awarding us attorney fees and costs. In July 2002, we were informed by plaintiff’s counsel that AISL had approved payment in the amount of approximately $171,000 to satisfy the entire judgment and approximately $114,000 to reimburse all attorneys’ fees and costs.

     On September 2, 2001, in a case styled Nellie Lake, Individually as an Heir-at-Law of Christina Zellner, deceased; and as Personal Representative of the Estate of Christina Zellner v. Res-Care, Inc., et al., in the U.S. District Court of the District of Kansas at Wichita, a jury awarded noneconomic damages to Ms. Lake in the amount of $100,000, the statutory maximum, as well as $5,000 for economic loss. In addition, the jury awarded the Estate of Christina Zellner $5,000 of noneconomic damages and issued an advisory opinion recommending an award of $2.5 million in punitive damages. The judge, however, was not required to award the amount of punitive damages recommended by the jury and on February 4, 2002, entered a punitive damage judgment in the amount of $1 million. Based on the advice of counsel, we appealed the award of punitive damages, based on numerous appealable errors at trial. Based on the advice of counsel, we believe any damages resulting from this matter are covered by insurance and, accordingly, we have not made any provision in our consolidated financial statements for any potential liability that may result from final adjudication of this matter. We do not believe it is probable that the ultimate resolution of this matter will have a material adverse effect on our consolidated financial condition, results of operations or liquidity.

     In September 1997, a lawsuit, styled Cause No. 98-00740, Nancy Chesser v. Normal Life of Texas, Inc., and Normal Life, Inc. District Court of Travis County, Texas was filed against a Texas facility operated by the former owners of Normal Life, Inc. and Normal Life of North Texas, Inc., one of our subsidiaries, asserting causes of action for negligence, intentional infliction of emotional distress and retaliation regarding the discharge of residents of the facility. In May 2000, a judgment was entered in favor of the plaintiff awarding the plaintiff damages, prejudgment interest and attorneys’ fees totaling $4.8 million. In October 2000, ResCare and AISL entered into an agreement whereby any settlement reached in Chesser and a related lawsuit also filed in the District Court of Travis County, Texas would not be dispositive of whether the claims in those suits were covered under the policies issued by AISL. AISL thereafter settled the suits and filed a Complaint for Declaratory Judgment against Normal Life of North Texas, Inc. and Normal Life, Inc. in the U.S. District Court for the Northern District of Texas, Dallas Division. In the Complaint, AISL seeks a declaration of what insurance coverage is available to ResCare in the lawsuits. It is our position that the lawsuits initiated coverage under the primary policies of insurance, thus affording adequate coverage to settle the lawsuits within coverage and policy limits. The trial of this declaratory judgment action previously scheduled for trial in March 2002 has been postponed with no new trial date set. We do not believe it is probable that the ultimate resolution of this matter will have a material adverse effect on our consolidated financial condition, results of operations or liquidity.

     In December 1999, a lawsuit styled James Michael Godfrey and Sherry Jo Lusk v. Res-Care, Inc., was filed by the former owners of Access, Inc., one of our subsidiaries, claiming fraud and unfair and deceptive trade practices. On July 29, 2002, a judgment was entered in favor of the plaintiff awarding the plaintiff damages of $990,000 with interest on $330,000 from December 1, 1999. Based on the advice of

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counsel, we will appeal the award of damages, based on numerous appealable errors at trial. In our opinion, after consulting with outside trial counsel, substantial grounds exist for a successful appeal. We have not made any provision in our consolidated financial statements for any potential liability that may result from final adjudication of this matter. We do not believe it is probable that the ultimate resolution of this matter will have a material adverse effect on our consolidated financial condition, results of operations or liquidity.

     In addition, we are a party to various other legal and/or administrative proceedings arising out of the operation of our facilities and programs and arising in the ordinary course of business. We believe that, generally, these claims are without merit. Further, many of such claims may be covered by insurance. We do not believe the results of these proceedings or claims, individually or in the aggregate, will have a material adverse effect on our consolidated financial condition, results of operations or liquidity.

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

Overview

     Res-Care, Inc. receives revenues primarily from the delivery of residential, training, educational and support services to populations with special needs. All references in this Quarterly Report on Form 10-Q to “ResCare,” “we,” “our,” or “us” mean Res-Care, Inc. and, unless the context otherwise requires, its consolidated subsidiaries. We have three reportable operating segments: (i) Disabilities Services, (ii) Youth Services and (iii) Training Services. Further information regarding each of these segments, including the disclosure of required segment financial information, is included in Note 4 of the Notes to Condensed Consolidated Financial Statements. Effective in the first quarter of 2002, with a restructuring within the Youth Services division and the appointment of a separate president for the Job Corps unit and one for the other youth services business unit, we split the Youth Services reporting segment into two segments: (i) Training Services (consisting of Job Corps operations) and (ii) Youth Services (consisting of other youth services operations). Accordingly, beginning in 2002, we have three reportable segments.

Significant Developments in 2002

     On March 22, 2002, we completed an amendment to our credit facility with a group of banks. The amendment takes into account certain fourth quarter 2001 charges in calculating the financial covenants and includes other changes in determining the borrowing base and the definition of eligible accounts receivable for that determination. Interest rates on borrowings under the facility and the standby letters of credit remain unchanged as a result of this amendment.

     During June 2002, we redeemed $1.4 million of our 6% convertible subordinated notes. This redemption resulted in a pretax gain of approximately $251,000 which is included in other income in the consolidated statement of income.

     During July 2002, we renewed our insurance coverages related to workers’ compensation, general and professional liability, auto and property. Significant changes in our coverages include 1) an increase in our deductible for workers’ compensation from $500,000 per occurrence to $1 million, with no change in loss limits and 2) a change in our property coverage from a $403 million aggregate limit per year to a $50 million per occurrence limit, with no change in the per occurrence deductible. All other insurance programs were renewed with no changes in deductibles or loss limits. Additionally, in connection with the renewal, we were required to provide additional collateral of approximately $19.5 million (comprised of letters-of-credit of $14.5 million and a callable cash deposit of $5.0 million) for the projected claims payments by us under the terms of the policies plus a market adjustment for prior years.

     During July 2002, we completed transactions to redeem approximately $3.6 million of our 6% convertible subordinated notes. This redemption will result in a pretax gain of approximately $800,000 in the third quarter of 2002.

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Results of Operations

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     Consolidated revenues for the second quarter of 2002 were $233.7 million, or 6% over the same period in 2001. For the six months ended June 30, 2002, revenues were $460.1 million, a 4% increase over the same period for 2001. These increases are due primarily to a growth in census and increased services in our periodic in-home services business unit coupled with prior year rate increases in various states and the addition of 68 new homes during the first half of 2002. Revenues for the first half of 2001 include approximately $2.2 million related to certain operations in Tennessee which we exited in March 2001.

     Our consolidated operating income for the second quarter of 2002 as compared to the same period of 2001 was negatively impacted by increased insurance costs. Consolidated labor costs for the second quarter are up slightly from the year-earlier period due principally to increased costs in our Training Services division due primarily to increased census. However, our initiative to deploy the time and attendance system is showing preliminary positive results. Although consolidated labor costs increased, labor costs within the Disabilities Services division improved quarter over quarter due to improved management of worked hours.

     Consolidated operating income for the first six months and second quarter of 2002 was positively impacted by a pretax gain of approximately $251,000 realized on the extinguishment of debt during the second quarter, an arbitration award of approximately $285,000 and $221,000 resulting from changing our estimated useful lives of our billing and time and attendance systems. The consolidated results for the first six months of 2001 were negatively impacted by special charges. Operating income for the first six months of 2001 included a charge of $1.6 million related to the write-off of assets and costs associated with the cessation of certain operations in Tennessee, and the write-off of $134,000 in deferred debt issuance costs resulting from a previous credit agreement.

     As a percentage of total revenues, corporate general and administrative expenses for the second quarter and six months ended June 30, 2002, were 3.6% and 3.7%, respectively. For the same periods in 2001, these expenses were 3.6% and 3.5%, respectively. The relative increase in the first half of 2002 over the same period in 2001 was due primarily to expanding the management infrastructure at the end of the first quarter of 2001 and costs related to our strategic projects initiated during 2001. These were partly offset by the arbitration settlement of approximately $285,000 discussed above.

     Effective January 1, 2002, we adopted Statement of Financial Accounting Standards (Statement) No. 142 and are no longer amortizing goodwill. Net income for the second quarter and six months ended June 30, 2001 includes goodwill amortization of $2.0 million, ($1.5 million net of tax, or $0.06 per share) and $4.0 million, ($2.9 million, net of tax, or $0.12 per share), respectively.

     Net interest expense was $6.1 million in the second quarter of 2002 compared to $4.8 million for the same period in 2001. For the six months ended June 30, net interest expense was $12.2 million and $9.8 million for 2002 and 2001, respectively. This increase resulted primarily from the issuance of the $150 million senior notes in November 2001, which was used in part to reduce borrowings under our previous credit facility, combined with a higher average interest rate in 2002 (9.0%) compared with 2001 (7.5%).

     Our effective income tax rates were 37.5% and 43.1% for the second quarter of 2002 and 2001, respectively. The lower estimated annual rate of 37.5% in 2002 is primarily a result of the elimination of nondeductible goodwill amortization.

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     Disabilities Services

     Results for the Disabilities Services segment for the second quarter and the six months ended June 30, 2002 as compared to the same periods in 2001 were impacted by the revenue growth and favorable labor trends described above. Revenues increased by 6.5% to $183.6 million for the second quarter of 2002 and by 5.2% to $361.4 million for the six months ended June 30, 2002 compared to the same periods in 2001, due primarily to a growth in census and increased services in our periodic in-home services business unit coupled with prior year rate increases in various states and the new homes discussed above, offset by the loss of revenue resulting from our exit from Tennessee. Segment profit, EBITDA and EBITDAR for the quarter were positively impacted by improved labor costs as a percent of revenue and other controllable expenses, offset somewhat by increased insurance costs.

     During the first half of 2002, we completed a transaction to acquire operations we had previously operated under a management contract. Consideration for the acquisition totaled approximately $10 million, including $9.9 million of debt forgiven and $100,000 in cash. As a result of the transaction, we recorded trade accounts receivable with a fair value of approximately $4.7 million and goodwill of approximately $4.6 million, as well as other assets and liabilities.

     Training Services

     Training Services revenues increased by 4% for both the second quarter and the first half of 2002, compared to the same periods in 2001, primarily from improved census at many of our centers. This also resulted in increases in segment profit, EBITDA and EBITDAR for the second quarter and first half of 2002 compared to 2001.

     Youth Services

     Youth Services revenues increased 1% for the second quarter of 2002 and decreased 5% in the first half of 2002 compared to the same periods in 2001. The decrease in revenues during the first half of 2002 was due primarily from reduced census at certain operations and the closure of an operation in Puerto Rico, offset somewhat by the addition of a new contract. This decrease in revenues, offset somewhat by operating efficiencies, resulted in increased EBITDA, EBITDAR and segment profit as a percent of revenue.

Financial Condition

     Total assets increased approximately 3% from the prior year end. The increase is due primarily to the acquisition described above and revenue growth. The acquisition contributed to an increase in accounts receivable of approximately $4.7 million and goodwill of approximately $4.6 million, offset by a decrease in other assets due to the forgiveness of debt. Revenue growth and improved operating results contributed to an increase in accounts receivable and cash.

     Accrued expenses increased due primarily to the increases in our insurance reserves.

Liquidity and Capital Resources

     For the first half of 2002, cash provided by operating activities was $11.7 million compared to cash used of $5.3 million for the same period of 2001. This increase was primarily related to higher profitability and increased insurance reserve balances in 2002 as compared to 2001. Additionally, the higher operating cash flow is a result of the rate of increase in accounts receivable during the second quarter of

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2002 that was approximately $6.6 million less than the increase during the same period in 2001. The cash flow increase was offset to some extent by a decrease in accounts payable in 2002 which was higher than that of 2001 principally due to timing of payments.

     For the first half of 2002, cash used in investing activities was $6.1 million compared to cash provided of $18.5 million in the same period of 2001, due principally to increased maintenance capital expenditures during 2002 and sale and leaseback transactions completed during 2001.

     For the first half of 2002, cash used in financing activities was $0.7 million compared to $38.4 million in the same period of 2001. The first half of 2001 included the use of proceeds from sale and leaseback transactions to pay down the revolving credit facility.

     Days revenue in accounts receivable were 56 days at June 30, 2002, compared to 53 days at December 31, 2001. Accounts receivable were $142.5 million and $132.2 million at June 30, 2002 and December 31, 2001, respectively. Approximately $4.7 million of the increase in the balance is attributable to the first quarter 2002 acquisition and revenue growth as described previously. We continue to expand implementation of a comprehensive accounts receivable/billing system, which is expected to facilitate improvements in collections. Approximately 96% of our Disabilities Services operations are currently utilizing the new system with the remainder of the targeted operations expected to be completed by September 30, 2002.

     Our capital requirements relate primarily to the working capital needed for general corporate purposes and our plans to expand through the development of new facilities and programs. We have historically satisfied our working capital requirements, capital expenditures and scheduled debt payments from our operating cash flow and utilization of our credit facility. Cash requirements for the acquisition of new business operations have generally been funded through a combination of these sources, as well as the issuance of long-term obligations and common stock.

     On November 15, 2001, we completed the issuance of $150 million of 10.625% senior notes due November 2008. The senior notes contain covenants restricting our ability to incur additional indebtedness (including the maintenance of a specified leverage ratio), pay dividends, enter into certain mergers, enter into sale and leaseback transactions and sell or otherwise dispose of assets. Additionally, the agreement places limits on the allowable amount of judgments or orders for the payment of money by a court of law or administrative agency.

     As of June 30, 2002, we had no borrowings under our credit facility. There are outstanding letters-of-credit of approximately $29.7 million. Therefore, as of June 30, 2002, in addition to cash and cash equivalents of $63.9 million, we had approximately $50.3 million available under the credit facility. Additionally, as discussed above, in July 2002 we were required to provide additional collateral in the form of letters-of-credit of $14.5 million and cash of $5.0 million in connection with the renewal of our insurance programs. The credit facility expires in September 2004. The facility also contains various financial covenants relating to indebtedness, capital expenditures, acquisitions and dividends and requires us to maintain specified ratios with respect to fixed charge coverage, leverage, cash flow from operations and net worth. Additionally, the agreement places limits on the allowable amount of judgments or orders for the payment of money by a court of law. Our ability to achieve the thresholds provided for in the financial covenants is largely dependent upon the maintenance of continued profitability and/or reductions of amounts borrowed under the facility. Based on current projections, we believe it is possible that we will not maintain the minimum ratio of EBITDA to consolidated interest expense as of September 30, 2002. However, we believe, based on discussions with our lenders, that it is probable that the credit agreement will be amended prior to that date and that we will be in compliance with our financial covenants as of September 30, 2002.

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     We believe cash generated from operations and amounts remaining available under our credit facility will be sufficient to meet our working capital, planned capital expenditure and scheduled debt repayment requirements for the next twelve months.

Contractual Obligations and Commitments

     Information concerning our contractual obligations and commercial commitments as of June 30, 2002 follows (in thousands):