Franklin Covey 2000 Annual Report Consolidated Statements of C ash Flows YEAR ENDED AUGUST 31, 2000 1999 1998 In thousands Cash Flows From Operating Activities: Net (loss) income $ (4,409) $ (8,772) $ 40,058 Adjustments to reconcile net (loss) income to net  cash provided by operating activities: Depreciation and amortization 48,510 43,547 38,626 Loss on impaired assets 16,559 Deferred income taxes 1,562 (10,503) 613 Restricted stock deferred compensation amor tization 262 522 652 Loss on sale of assets 295 673 317 Changes in assets and liabilities, net of effects fr om  acquisitions: Decrease (increase) in accounts receivable 4,639 (8,879) (9,995) Decrease (increase) in inventories 3,943 (11,981) 8,061 Increase in other assets and other long-ter m liabilities (8,056) (3,868) (12,044) Increase (decrease) in accounts payable and accrued liabilities 5,804 10,966 (4,495) (Decrease) increase in accrued restructuring costs (11,040) 16,200 Increase (decrease) in income taxes payable 9,113 (8,491) 12,261 Net cash provided by operating activities 50,623 35,973 74,054 Cash Flows From Investing Activities: Acquisition of businesses, including earnout pa yments (21,444) (19,025) (16,786) Purchases of property and equipment, net of  effects from acquisitions (24,523) (22,996) (39,239) Proceeds from sale of property and equipment 7,032 1,288 12,210 Net cash used for investing activities (38,935) (40,733) (43,815) Cash Flows From Financing Activities: Net increase (decrease) in short-term borrowings 16,488 (2,229) (889) Proceeds from long-term debt and line of credit, net  of effects  from acquisitions 76,308 1,142 119,969 Payments on long-term debt and capital lease  obligations (109,502) (40,652) (87,221) Proceeds from issuance of Series A Preferred Stock,  net 4,092 75,000 Purchases of common stock for treasury (5,483) (32,710) (57,013) Proceeds from issuance of treasury stock 6,069 1,826 3,602 Payment of preferred stock dividends (5,977) Net cash (used for) provided by financing  activities (18,005) 2,377 (21,552) Effect of foreign exchange rates 778 1,404 (1,316) Net (decrease) increase in cash and cash equivalents (5,539) (979) 7,371 Cash and cash equivalents at beginning of year 26,781 27,760 20,389 Cash and cash equivalents at end of the year $ 21,242 $ 26,781 $ 27,760 See accompanying notes to consolidated financial statements. 38 Consolidated Statements of Cash Flows