Corporate Report

Corporate Report

OSI Restaurant Partners agrees to cash buy-out

Tampa-based OSI Restaurant Partners Inc. officials have approved a definitive agreement to be acquired by an investor group made up of Bain Capital Partners, LLC, Catterton Partners and company founders: Chris T. Sullivan, Robert D. Basham and J. Timothy Gannon, for $40 per share in cash.

The board of directors of OSI Restaurant Partners, on the unanimous recommendation of a special committee of independent directors, has approved the merger agreement and recommends that OSI's shareholders adopt the agreement.

The total transaction value, including assumed debt, is about $3.2 billion. The transaction is expected to close before the end of April and is subject to approval by OSI's shareholders (other than those participating in the acquisition.)

For the next 50 days, the special committee will be conducting a market test soliciting proposals from other parties.

In a statement explaining the approval, the special committee says "This transaction will provide OSI Restaurant Partners' shareholders with an immediate and substantial cash premium over the current trading price of the Company's common stock." Backers of the acquisition also say the change would allow the company great flexibility to focus on long-term business improvements.

Wachovia Securities LLC served as financial advisor to the special committee of the OSI Restaurant Partners board of directors in connection with the merger. Wachtell, Lipton, Rosen & Katz is acting as special counsel to the special committee and Baker & Hostetler LLP is acting as counsel to OSI in this transaction. Ropes & Gray LLP is representing Bain Capital and Catterton in their investment in the Company.

In other news, OSI has filed plans to restate some to its liabilities for understatements of unearned revenue for unredeemed gift cards and certificates and other financial misstatements. The changes are expected to adjust the company's unearned revenue liability by about $50 to $70 million at Sept. 30, 2006.

HealthCare Partners buys JSA Healthcare Corp.

HealthCare Partners, LLC, a Torrance, Calif.-based healthcare management services organization acquired St. Petersburg-based JSA Healthcare Corp. and its affiliated operations, including the Las Vegas-based physician network Pinnacle Health System. JSA will function as a wholly-owned subsidiary. HealthCare Partners, LLC owns and manages HealthCare Partners Medical Group, one of the largest medical groups in Southern California.

"The acquisition of JSA Healthcare helps us attain several important, strategic goals, including geographic and payor diversification," explained Robert J. Margolis, MD, CEO of HealthCare Partners in a press release. "JSA Healthcare (JSA) and Pinnacle Health System will enable us to grow our Medicare Advantage programs and pro-actively diversify our portfolio of services in a consolidating national market environment. JSA and Pinnacle have strong, proven management, a synergistic model of medical care delivery and patient-focused cultures. Both JSA and Pinnacle will continue operations under their respective names and current management."

The acquisition covers about 500,000 patients.

ARMAMENT

General Dynamics Ordnance signs deal to bring Thor to U.S.

St. Petersburg-based General Dynamics Ordnance and Tactical Systems, a business unit of General Dynamics, signed a licensing agreement with the RAFAEL Armament Development Authority in Israel to provide Thor, a dual-mode, standoff ordnance neutralization system, to U.S. defense customers. Thor is designed for use by explosive-ordnance disposal teams and military combat engineers to neutralize explosives.

The General Dynamics Ordnance and Tactical Systems agreement with RAFAEL is exclusive to the U.S. market and includes a license to produce systems in the U.S. and to provide integration, training and product support.

"This agreement allows General Dynamics to enhance its offerings to U.S. customers," said Richard Davitt, vice president and general manager of Precision Systems for General Dynamics Ordnance and Tactical Systems. "Thor has demonstrated combat effectiveness in operational engagements bringing an additional to the fight, while at the same time filling a unique tactical mission role."

Thor is a remotely operated turret-style weapons system that directs a M2 12.7 mm machine gun and high-energy laser. The weapon can be mounted on a vehicle.

General Dynamics Ordnance and Tactical Systems is a manufacturer of munitions, mortar weapons and systems, artillery projectiles, bomb bodie, Ball Powder(R) Propellant and more. The company also manufactures precision metal components; provides explosive load, assemble and pack services for a variety of munitions, tactical missile and rocket programs; and designs and produces shaped charge warheads and control actuator systems

BB&T Insurance Services buying Wyman, Green & Blalock

Raleigh, N.C.-based BB&T Insurance Services, the nation's seventh largest insurance broker, plans to expand its Florida operation with the acquisition of Bradenton-based Wyman, Green & Blalock Inc. Founded in 1908, Wyman, Green & Blalock specializes in personal and commercial property insurance, liability risk management and employee benefits.

"Their strong presence in the Bradenton and Sarasota areas and their reputation in the insurance community make them the perfect BB&T insurance agency," Wade Reece, president of BB&T Insurance Services, said in a press release announcing the acquisition.

The transaction is scheduled for completion in early December. Terms were not disclosed. Wyman, Green & Blalock will keep its staff and continue to operate from its offices in Bradenton and Lakewood Ranch as BB&T-Wyman, Green & Blalock.

BB&T Insurance Services already operates Florida agencies BB&T-Landrum Yaeger in Tallahassee and BB&T-Iler, Wall & Shonter in St. Petersburg and Orlando.

Wyman, Green & Blalock president Greg Bustle and vice president Corky Taylor will continue to manage business development and client relationships while chief operating officer John Laurie will serve as agency manager.

Chico's October revenue up but comparable-store sales down

Fort Myers-based specialty clothing retailer Chico's FAS, Inc. reported October sales increased 9.9% to $125.3 million from $114.0 million reported for the prior year's four-week period ended Oct. 29, 2005. Comparable store sales for the company-owned stores dipped 4.1% for the four-week period ended Oct. 28, 2006, compared to the same four-week period last year.

Total sales for the third quarter ended Oct. 28 increased 12.1% to $402 million from $359 million for the same period a year ago. Comparable store sales for the company-owned stores decreased 1.2% for the thirteen-week period compared to the same thirteen-week period last year.

For the thirty-nine weeks ended Oct. 28, total sales increased 16.5% to $1.199 billion from $1.029 billion for the same period a year ago. Comparable store sales for the company-owned stores increased 3.6% for the thirty-nine week period compared to the same thirty-nine week period last year.

"We are disappointed with our October sales results," Scott Edmonds, announced in a press release discussing the results. "Accordingly, we are reducing our third-quarter earnings estimate to $.22 - $.25, and will provide further updates on our third quarter earnings conference call on Nov. 29, 2006."

The company operates 882 women's specialty stores, including stores in 47 states.

Children's Network contract dispute with DCF resolved

Florida Department of Children and Families has withdrawn its termination letter and reinstated a five-year contract to Fort Myers-based Children's Network of Southwest Florida, LLC to provide child welfare services in Lee, Charlotte, Collier, Glades and Hendry counties.

Children's Network of Southwest Florida, LLC is a wholly-owned subsidiary of Camelot Community Care, Inc., a Florida not-for-profit entity that is managed by Providence Service Corp. DCF had previously announced plans to solicit new bids on the contract as part of organizational changes in the child welfare services.

Under the agreement, Children's Network of Southwest Florida, LLC will create a local board of directors from the five county area.

Etc...

• Sarasota-based architecture firm The ADP Group has acquired the architectural firm HRMA Inc., which specializes in master planning clubhouse design, interior design, and club consulting. The joint firm has completed more than 60 clubhouses in Florida with more than 140 clubhouses in 26 states and Costa Rica. Richard A. Heise, the founder of HRMA, will direct the ADP's clubhouse studio.

• Tampa-based  IA Global Inc. closed its 36% equity investment in Australian Secured Financial Limited and its affiliates, Australian Secured Investments Ltd. and ADJ Services Pty Ltd. Australian Secured Investments Ltd. raises funds through the issuance of debentures in Australia and provides short term loans that are secured by real property.

• The Board of Directors of Tampa-based OSI Restaurant Partners, Inc. has declared a quarterly dividend of $0.13 per share of the company's common stock. The dividend is payable on Dec. 1, 2006 to shareholders of record as of Nov. 17, 2006.

• Las Vegas-based H3Enterprises, Inc. plans to debut its H3TV, a customized flat screen HDTV, at the HipHopSodaShop restaurant in St. Petersburg that is being built in partnership with former Buccaneer Warren Sapp. H3TV is a multi-functional computerized television display designed with extremely high resolution and special video game functions and is being marketed to the "Hip Hop Generation." The H3TV will be sold out of the merchandise section within the SodaShops.

• Cynthia McGathey has been named chief information officer for FrankCrum, a Clearwater-based professional employer organization and staffing company. Prior to joining FrankCrum, McGathey served as vice president of Information Technology with Certegy; CIO/senior vice president of IT for Special Data Processing Corp. and vice president of Operations and Administration, Abra Software Inc.

• Bradenton-based PEO Gevity has opened a Charlotte office. The new branch follows the third quarter opening of its North Central region hub in Chicago. Additional full-service offices planned for the fourth quarter of 2006 include Austin, Texas and San Antonio, Texas.

Gulf Coast companies report results

Third Quarter

Nicholas Financial revenue-record streak grows in third quarter

Clearwater-based Nicholas Financial Inc. reported its net income increased 10% to $2.8 million ($0.27 diluted earnings per share) for the three months ended Sept. 30 compared to $2.5 million ($0.24) for the same three months in 2005. Revenue increased 13% to $11.6 million for the three months ended Sept. 30, 2006 as compared to $10.2 million for the three months in 2005.

The company has reported record same quarter increases in revenue and earnings for 65 out of the past 66 quarters.

Net income increased 18% to $5.8 million ($0.56 diluted earnings per share) for the six months ended Sept. 30, 2006 compared to $4.9 million ($0.47) for the six months in 2005.

Revenue increased 18% to $22.9 million for the six months ended Sept. 30, 2006 as compared to $19.4 million for the six months ended Sept. 30, 2005.

In other news Nicholas Financial recently opened a new branch office in Savannah, Ga.

Nicholas Financial reported assets of $159.9 million as of Sept. 30.

Nicholas Financial Inc. Consolidated Statements of Income

(Unaudited, In Thousands, Except Share and Per Share Amounts)

For the Three Months Ended For the six Months Ended

Sept. 30, Sept. 30,

2006 2005 2006 2005

Revenue 11,607 10,239 22,936 19,399

Expenses 7,125 6,185 13,552 11,490

Net income $2,769 $2,509 $5,798 $4,903

Earnings per share diluted $0.27 $0.24 $0.56 $0.47

Condensed Consolidated Balance Sheets (Unaudited, In Thousands)

Sept. 30, March 31,

2006 2006

Cash 1,732 $1,729

Finance receivables, net 150,544 140,198

Other assets 7,643 7,568

Total assets $159,919 $149,495

Line of credit $87,073 $82,416

Other liabilities 8,934 8,830

Total liabilities 96,007 91,246

Shareholders' equity 63,912 58,249

Total liabilities and shareholders' equity $159,919 $149,495

Portfolio Summary

For the Three Months Ended For the six Months Ended

Sept. 30, Sept. 30,

2006 2005 2006 2005

Average finance

receivables, net

of unearned interest $169,312,348 $146,973,291 $167,235,278 $144,471,462

Finance revenue $11,573,987 $10,197,903 $22,868,993 $19,307,604

Interest expense 1,362,691 1,058,479 2,622,894 2,039,032

Net finance revenue $10,211,296 $9,139,424 $20,246,099 $17,268,572

Average cost of

borrowed funds 6.41% 5.90% 6.24% 5.84%

Gross portfolio yield 27.34% 27.75% 27.35% 26.73%

Source: Nicholas Financial Inc.

Coast Bank net interest income up, loses $1.5 million in earnings for quarter

Coast Financial Holdings Inc., the Bradenton-based parent company of Coast Bank of Florida, reported significant loan and deposit growth for the third quarter of 2006, with loans growing 45%, deposits increasing 38% and net interest income rising 30% compared to the third quarter a year ago.

Coast officials attributed the growth in assets of 40% in the past year to its expansion throughout the Tampa Bay market.

For the third quarter of 2006, the company reported a loss of $1.5 million ($0.22 per share) as compared to earnings of $106,000 ($0.03 per share) in the third quarter a year ago.

For the first nine months of 2006, the company reported a loss of $2.5 million ($0.38 per share) as compared to a loss of $775,000 ($0.21 per share) in the first nine months of 2005.

"Earlier this quarter we opened the Walsingham branch in the town of Largo and last week we opened a branch in Pinellas Park," Brian Grimes, president and CEO said in a press release announcing the results. "We have opened eight branches in the greater Tampa Bay area in 2006, in addition to the five opened in 2005, now bringing our branch franchise to 20 locations. We previously announced plans to open two additional branches in late 2006, but based on our new tempered growth strategy in response to the changing local real estate and interest rate markets, we do not expect to open these branches prior to the first quarter of 2008."

Coast Financial Holdings Inc. and subsidiary consolidated statements of earnings (unaudited, in thousands except per-share amounts)

Interest income

Three Months Ended Nine Months Ended

Sept. 30, Sept. 30,

2006 2005 2006 2005

Loans $9,367 $6,013 $24,510 $16,330

Securities 1,010 578 2,954 1,552

Total interest income 10,546 6,656 28,022 17,962

Interest expense:

Deposits 5,991 3,110 14,865 7,895

Borrowings 213 207 600 618

Total interest expense 6,204 3,317 15,465 8,513

Net interest income 4,342 3,339 12,557 9,449

Net interest income

after provision for loan losses 4,067 3,337 11,975 7,565

Total noninterest income 561 617 1,689 1,821

Employee compensation

and benefits 3,616 1,915 8,777 5,261

Occupancy and equipment 1,268 614 3,320 1,567

Data processing 281 231 763 662

Professional fees 233 126 667 570

Advertising 522 356 1,463 867

Total noninterest expenses 6,919 3,776 17,498 10,605

Net (loss) earnings $(1,456) $106 $(2,473) $(775)

(Loss) earnings

per share, diluted $(0.22) 0.03 $(0.38) (0.21)

Additional financial information (in thousands)

Loans:

Sept. 30, 2006 June30, 2006 Sept. 30, 2005

(unaudited) (unaudited) (unaudited)

Commercial $13,969 $13,645 $17,946

Commercial real estate 136,952 131,688 125,450

Installment 45,852 39,800 27,492

Residential real estate 99,580 74,404 50,151

Residential construction 236,739 221,326 146,350

533,092 480,864 367,389

Loans, net $531,391 $479,174 $366,12

Source: Coast Financial Holdings Inc.

Walter Industries revenue revs up, Mueller sale set for December

Tampa-based Walter Industries Inc. reported earnings from continuing operations of $65.2 million ($1.27 per diluted share) for the third quarter ended Sept. 30, 2006, compared with earnings of $20.4 million ($0.44 per diluted share) in the third quarter last year.

During the third quarter, the company recorded a $1.7 million after-tax, non-cash charge to discontinued operations. The charge resulted from a receivable related to the December 2003 sale of AIMCOR, a previously owned subsidiary of the company.

Gregory E. Hyland, Chairman and CEO Walter Industries, says the company's spin-off of Mueller Water remains on track for mid-December.

Consolidated net sales and revenues for the third quarter were $857 million, up from $418.7 million in the prior-year period.

Current quarter results include the addition of $362.0 million in revenues from Mueller Co. and Anvil. Revenues at natural resources increased 72.7% versus the prior-year period primarily driven by higher metallurgical coal volumes and increased overall average pricing. Third quarter results also reflect 9.1% revenue growth in the homebuilding and financing group, principally as a result of higher average net selling prices for delivered homes versus the prior-year period.

Walter Industries, Inc. and subsidiaries condensed consolidated statements of operations (in thousands, unaudited)

For the Three Months Ended For the Nine Months Ended

Sept. 30, Sept. 30,

2006 2005 2006 2005

Net sales $795,555 $362,046 $2,255,361 $1,079,287

Cost of sales

(exclusive of depreciation) 555,975 280,327 1,573,801 816,050

Depreciation 27,612 14,238 79,932 43,063

Selling, general

and administrative costs 92,121 48,328 274,302 144,913

Net income $63,245 $20,197 $162,505 $80,443

Net income

(diluted income per share) $1.23 $0.43 $3.20 $1.71

Net sales and revenues

For the Three Months Ended For the Nine Months Ended

Sept. 30, Sept. 30,

2006 2005 2006 2005

Mueller Co. $222,975 $- $641,539 $-

Anvil 139,018 - 403,028 -

U.S. Pipe 164,063 170,274 427,515 456,929

Mueller Water Products 526,056 170,274 1,472,082 456,929

Natural Resources 184,392 106,796 526,584 378,324

Homebuilding 68,287 55,994 197,421 161,790

Financing 54,587 56,621 166,425 174,320

Homebuilding and Financing Group 122,874 112,615 363,846 336,110

Source: Walter Industries Inc.