In Re Dibiase
Memorandum Deoision On Trustee’s Objection to Exemptions Together With Motion For Turnover
This is a case about stock options. The chapter 7 trustee claims that at least some portion of the options are non-exempt property of the estate, and should be available to be exercised — even if the exercise date occurs in the future, well after the bankruptcy filing. The trustee filed an objection to the debtor’s exemption claim, along with a motion for turnover of the options. This memorandum sets out this court’s ruling on the issue.
Background
Gregory Dibiase is an employee of Teso-ro Petroleum Corporation. As an incentive to retain certain employees, and pursuant to an Employee Stock Option Plan,
On May 10, 2001, some six months before the first anniversary of the agreement, Gregory Dibiase filed for chapter 7 bankruptcy. Helen G. Schwartz was appointed as trustee. On July 3, 2001, the debtor filed amended schedules claiming this Option as exempt under the “wild card” category of the federal exemption scheme. See 11 U.S.C. § 522(d)(5). He had already used up all the value of the wild card on other assets, but maintained that he could still claim the Option as exempt because it added no dollar value to the total of assets claimed under section 522(d)(5). He valued the Option at “zero” on the theory that, as of the date of the bankruptcy filing, the Option was “not vested.”
The trustee objected to the debtor’s claiming the Option as exempt, and also sought turnover of the Option, to the extent that the options could be attributed to the debtor’s pre-petition employment.
2
With regard to the exemption question, the trustee maintains that the Option does not have to “vest” to be considered property of the estate, and that therefore the Option has some value greater than zero as of the date of the filing. If she is correct, then as a matter of law, the debtor will not be able to shelter the Option under the wild card exemption, and no other
To recap, then, there are two issues presented here. The first issue — whether the Option can be claimed as exempt under section 522(d)(5) — depends on whether the Option was vested on the date of filing such that it had some value greater than zero. The second issue — the percentage of the Option to which the trustee is entitled — depends on an analysis of the Allen allocation formula. We shall discover, with regard to this second issue, that, in fact the Allen allocation formula, for reasons set out in this opinion, should be rejected in its entirety, rendering that issue essentially moot. Both issues, however, rely on a fairly straightforward analysis of “property of the estate” as that concept is applied to employee stock options.
Analysis
There are no Fifth Circuit cases construing how to handle employee stock options. The trustee cites a number of bankruptcy cases, all of which hold that a debtor’s employee stock options, awarded pre-petition, constitute assets that become part of the bankruptcy estate upon filing, even if the debtor only becomes entitled to actually exercise the options post-petition.
See Allen v. Levey (In re Allen),
Section 541(a)(1) of the Bankruptcy Code defines “property of the estate” to include “all legal or equitable interests of the debtor in property as of the commencement of the case.” 11 U.S.C. § 541(a)(1). This generous provision sweeps into the bankruptcy estate
all
interests held by the debtor — even future, non-possessory, contingent, speculative, and derivative interests.
See United States v. Whiting Pools, Inc.,
I. What Was Granted and When Was It Granted
The debtor commenced this bankruptcy proceeding on May 10, 2001. Some seven months earlier, on October 24, 2000, the debtor and his employer, Tesoro Petrole
II. What Was the Extent of the Debtor’s Interest in the Option as of Filing (or Divesting the Notion of Vesting)
The debtor’s exemption claim was premised in part on the notion that the Option in this case had not “vested,” ie., that in some sense the debtor did not have “ownership” of the Option. The source of this argument is the paragraph that sets out the terms for exercising the Option. That paragraph is denominated “Vesting Schedule,” and lays out the exercise schedule described earlier in this decision. There are two essential features to this schedule. First, the debtor/employee can only buy so much stock at a time using the Option (no more than l/4th of the available 5,000 shares annually, commencing one year after the agreement). Second, the debt- or/employee can lose the right to exercise the option in whole or in part, depending on when and whether his employment is terminated. The debtor argues, in essence, that, as of the filing, he had not worked long enough to earn the right to use the Option, so the Option had not “vested,” meaning that, as of the filing, the debtor essentially owned nothing. 4 While he values the option at “zero” the real thrust of the debtor’s argument is that the Option was not property of the estate as of the date of filing.
The debtor’s argument fails, for a number of reasons. Firstly, the argument fails because, as a matter of contract construction, the so-called “vesting schedule” is not in fact a vesting arrangement as that term might normally be used. Secondly, the
A. As A MATTER OF CONTRACT CONSTRUCTION, the Nonqualified Stock Option AGREEMENT MAKES No PROVISION for “Vesting.”
The debtor must, of necessity, place great weight on the title of the second operative paragraph of the Nonqualified Stock Option Agreement, denominated “Vesting Schedule.” However, the
body
of the paragraph makes no reference whatsoever to “vesting” of the
Option.
The entire subject matter of the paragraph is a schedule for the
exercise
of the options. There is, of course, a clear difference between
owning
an Option (vesting) and the conditions for
using
the Option (exercising). A general rule of contract construction is that, absent ambiguity, the more specific provisions of a contract will control over the more general terms.
See generally Weingarten Realty Investors v. Al-bertson’s, Inc.,
Stock options may be contrasted with retirement benefits, which are often the subject of a vesting schedule. A given employer may offer, as part of its benefits package, the ability to receive certain payments upon retirement, but only if the employee remains employed for a period of
For these reasons, the court concludes that, as a simple matter of contract construction, the debtor’s interest in the Option was, as of the date of the filing, “fully vested” (to the extent that phrase has any legal significance). That is to say, what the debtor owned as of filing was an Option, albeit an option subject to certain limitations and to the possibility of defea-sance by later events.
B. As A MATTER OF TEXAS LAW, THE Option Was Property of the Debtor as of the Date of the Bankruptcy Filing, Regardless of “Vesting.”
The Bankruptcy Code does not define the expression “interest in property.” However, the Supreme Court has said that the term is intended to be construed broadly and encompasses every right and interest cognizable under non-bankruptcy law.
See generally Segal v. Rochelle,
Texas courts indeed recognize that stock options constitute a species of property, capable of division in a divorce proceeding, for example.
See Charriere v. Charriere,
... Under [the stock option] agreement, the options granted to Valerie were exercisable any time after the grant date and before the “option termination date.” Thus, under the agreement, Valerie had the right to purchase all 80,000 shares of Thermolase stock during the parties’ marriage. In addition, under the agreement, once Valerie exercised her option, she enjoyed “ownership of the shares,” including the right to vote the shares and receive dividends. Thus, it appears that, under the agreement, the optioned shares (1) were available for purchase during the marriage; and (2) once purchased, included potentially valuable rights. Under these circumstances, we conclude ... [that] the options, which were acquired and exercisable during marriage, were community property subject to division as part of the parties’ community estate....
Id. One party in Charriere argued that the stock options could not be divided by the court because their exercise was dependent on whether the spouse continued to be employed at that company. The Charriere court responded to the argument as follows:
We recognize that, to the extent the value of the options is dependent on Valerie’s post-divorce employment, she can control the value of those options to Charles (ie., she can terminate her employment and effectively deprive him-— and herself — of any value those options would have had over time). However, the fact that the value associated with some or all of the options could be forfeited by the occurrence of certain contingencies (ie., Valerie’s termination of employment with the company) does not divest the options of their status as community property. See Busby v. Busby,457 S.W.2d 551 , 553 (Tex.1970) (recognizing that portion of military retirement benefits could be community property even though any value associated with benefits could be forfeited if husband was dishonorably discharged from military); Mora v. Mora,429 S.W.2d 660 , 662 (Tex.Civ.App. — San Antonio 1968, writ dism’d) (noting that rights under military retirement plan were not divested of status as community property merely because rights could be forfeited if certain contingencies occurred); see also Cearley v. Cearley,544 S.W.2d 661 , 665 (Tex.1976).
Id., at 220. Thus, the court concluded that the occurrence of a later event (such as termination of employment) that might alter or destroy the value of the option in futuro would not alter the status of the stock option as property at the current time. In Texas, stock options are considered to be a present interest in property, even if they may be forfeited in the event of future contingencies.
Indeed, even so-called “unvested” stock options constitute, in this state, a present contingent interest in property subject to consideration along with other property capable of equitable distribution by a court in the dissolution of a marriage.
See Cearley v. Cearley,
C. NO PART OF THE OPTION CAN BE ALLOCATED to the Debtor under the Allocation Formula in Allen, Because Allen is Wrongly Decided.
The Option — the entire Option— belongs to the estate. The debtor nonetheless argued (and the trustee, it seems, acceded, at least in principle) that a portion of the Option ought to be
excluded
from the estate, because it is, under the
Allen
allocation formula, attributable to post-petition efforts of the debtor. As the estate may only consist (with a few minor exceptions) of a debtor’s interest in property as of the date of filing, any interests which come into existence post-petition do not become property of the estate (argues the debtor). The proposition is correct as a general principle. It does not apply here, however, notwithstanding the analysis in Part II of the
Allen
decision that led to the development of the allocation formula to which we have made continuing reference thus far in this decision.
See Allen v. Levey (In re Allen),
The allocation formula in
Allen
seems to have grown out of that court’s concern that the trustee would have the benefit of the option even though its exercise
in futuro
depended on whether the debtor continued to work at the company post-petition, con
the actual value to the estate of contingent future interests must be equal to the value of the debtor’s interest on the petition filing date. The extent of the bankruptcy estate’s interest in property cannot exceed the interest possessed by the debtor at the commencement of the case.... The realized or realizable value of an interest that was contingent at the time of filing is property of the estate only to the extent that the subsequently realizable value is related to pre-petition actions of the debtor.
In re Allen,
The Allen court’s first error is in confusing the future value of a given stock option with the estate’s present interest in the option. Future events can indeed have an impact on the future value of a stock option — market conditions, the debtor’s future employment with the company, the company’s own business prospects all can have an impact. The mere fact that some of an asset’s eventual value might be affected by post-petition events, however, should not of necessity affect the independent determination whether the estate owns all or only a portion of an asset. 13
Allen itself ruled in Part I of its opinion that all of the option was property of the estate as of filing, agreeing with this court. Yet Allen in Part II relies on quantum meruit principles, because, in the court’s view, the debtor’s post-petition actions add or create value post-petition, such that the debtor “earns” or “creates” not just the value of the option but a portion of an interest in the option (called by the Allen court “realizable value”) by continuing to be employed. Indeed, this notion of “earning” is reinforced when the Allen court suggests that some portion of the Option may actually represent some species of post-petition earnings. See Allen, supra at 866.
The
Allen
court had already boxed itself in with its earlier analysis that the Option, though in some sense contingent, is nonetheless property of the estate, eliminating the court’s ability to claim that the Option is
directly
attributable to earning activity — like a salary for example.
14
Yet the
Because Debtor’s contingent contract rights became property of the bankruptcy estate on January 10,1997, his subsequent rights to exercise them, which continued and still existed post-petition, may be interests in property acquired post-petition under § 541(a)(7). But they are certainly matured rights that comprise proceeds and profits from the original property of the estate under § 541(a)(6).
Id. The Allen court, unfortunately, finds itself ruling both that the entire option is property of the estate on the date of filing, see id., at 866, and that some portion of the option is post-petition proceeds subject to the earnings exception in section 541(a)(6). See id., at 867. For that conclusion to stand, the option must be both the property of the estate and the proceeds of itself (because the earnings exception in section 541(a)(6) applies only to proceeds of property of the estate). The logic does not work. The option cannot be both the property that comes into the estate upon filing and the proceeds of itself. 16
Here is another way to think about the distinction between conditions precedent and conditions subsequent in the context of this option: Suppose the employer in this case decided to revoke the option 100 days after the agreement — well before the date of first exercise. By the facial terms of the agreement, the employee would not have to wait another 265 days before bringing a suit for breach. He could sue immediately. ■ The debtor does not have to work 265 more days before bringing his suit, because that is not a condition precedent to the present existence of the employer’s duty (and hence the existence of the breach). The plaintiff does not have to plead “I have been working for 365 days” as an essential element of his cause of action for breach of contract, because that is not a condition precedent to performance by the company.
21
By contrast, if the employee is terminated two days before the first exercise date, but later tries to exercise the option, the company will not honor the exercise of the option. The refusal to honor the option would, but for the condition subsequent, constitute a breach of the agreement. In a later suit by the employee to enforce the option (or sue for breach), the defendant company will properly plead,
as an affirmative defense,
that the employee was terminated, relieving the employer of the duty to perform. The condition subsequent relieves the defendant company of the duty to hon- or the option, excusing its non-performance. This allocation of pleading burdens is one way to distinguish conditions precedent from conditions subsequent.
See
Fed.R.Civ.P. 9(c), 8(c).
Failure
of a condition precedent means that the defending party is relieved of the duty of
And this is why Allen is wrong. It presumes there must bé a condition precedent, then casts about for an event that fills the bill, and arrives at “continued employment.” Yet clearly continued employment is a non-event. It is the maintenance of the status quo. The essence of conditions is that they are' future events or occurrences. Here, the relevant “event” is termination of employment, which, if it occurs, relieves the other party from performance. That is the very essence of a condition subsequent. The rights and duties between the parties are fully earned and in esse, subject to defeasance by a later occurrence. The debtor does not earn the right to use the Option in this case at all. It was granted the Option at the outset. The debtor can forfeit some or all of the benefit of the Option by quitting (or lose the benefit by being fired), but absent the occurrence of these events, the Option has its full value on the day it is granted. As of the filing, the debtor was employed, and thus owned the Option. There were no conditions precedent to its ownership, though there were qualifications on how and when the Option could be used. The Option in Allen did not have to be earned. Neither does the Option in this case.
The
Allen
court seems to have succumbed to the understandable, but dangerous, impulse to do what it thought was equity in derogation of the plain import of the statute. This, a bankruptcy court cannot do — especially a bankruptcy court in this circuit.
See U.S. v. Sutton,
Yet even if there were an “equitable exception” to the plain language of the statute and case law, the facts of this case in fact do
not
raise any particular equitable concerns that would demand special intervention by the courts. True enough, the
Allen
court was obviously troubled about what it perceived to be the inequities of the debtor losing the value of the stock options even though he continued to work. After all, those options were granted in the first place as an incentive to keep the employee at the company. With bankruptcy, the employee might keep working but would not enjoy the benefit of the incentive. And by continuing to work, he would
de facto
“add value” to (or at least not subtract value from) the Option. That,
In summary, then, the Allen formula is simply wrong, and should not be followed by this or any other court.
Conclusion
For all of the foregoing reasons, the court’s legal conclusions are simple and straightforward, though the eventual outcome of this case is not. The debtor’s exemption claim will not stand, as the Option had value as of filing, but the debtor was out of “wild card” to shelter it. What is more, the exclusion argument will not stand either, as all of the Option became property of the estate as of filing and none of the Option ought to be “allocated” to post-petition efforts of the debtor. The allocation formula first designed in Allen and repeated in Lawton lacks a legal foundation and is here rejected.
Unfortunately,
Allen
and
Lawton
have already done their damage in this case, misleading both the trustee and the debt- or. The formula invented by the court in
Allen
is designed to
exclude
part of the stock option from the estate, but exclu
Now we are faced with an ironic outcome. The trustee could have received the entire stock option, because this court has found that there is no legally justifiable basis for “splitting” the asset along the lines proposed by Allen. But the court can award no more than what has been pleaded. Accordingly, the court can only enter an order sustaining the trustee’s objection to exemptions, but awarding to her the proportion of the option for which she pleads, and no more.
An order will therefore be entered granting the relief requested in the trustee’s motion.
Notes
. Thus, for example, the debtor/employee could choose not to purchase any stock on the first anniversary, or even the second anniversary, but decide to purchase stock on the third anniversary, in which event he would be permitted to purchase 3750 shares at the option price specified (1/4 plus % plus = 3/4).
. The trustee’s limited turnover request was based on her reading of the limited case law on how stock options are to be handled in bankruptcy.
See Allen v. Levey (In re Allen),
. All markets are inherently uncertain and no one would dare to guarantee that the market for a given stock will always increase. On average, however, the stock market has, over the long term, risen in value over the years, the theory that underlies the retirement planning of most Americans. See, e.g., “Smart guidelines for the successful investor” Copyright © 1999 National Association of Investors Corporation, at http:// www.oysa.org/guide.html. More to the point, however, it is the certainty of the price that has value. Consider this: two persons intend to purchase stock in Company A one year hence. One has a pre-set guaranteed price, the other does not. If the stock goes up, the one with the pre-set option price makes money on the purchase by being able to purchase at a below-market price. If the stock goes down, both purchase the stock at the lower market price. The one holding the option does not lose in the event of a downturn, because the option was a grant, costing the holder no money. But only the one with the option makes money in the event of an upturn. Therefore, as of today, one year in advance, the one holding the option has something of value, an advantage over the one without the option.
. Alternatively, the debtor also argued that, if the debtor owned anything as of filing, it was only a fraction of the Option equal to ratio between the total number of days he would have to work to be entitled to all of the Option (365 days x 4 years) and the number of days he worked between the date the contract was signed and the day he filed bankruptcy (198 days).
. Options, it will be seen, share some of the qualities of a stock “call,” which is nothing more than a right to purchase a given number of shares of a company at a given pre-set price on a given future date. The right to purchase at a preset price is an asset that has value — which is why stock calls are themselves bought and sold. The nature of the property right is defined by such features as the option price and the strike date, of course, but these features do not prevent the option from being property in its own right. The right to purchase is a species of intangible personal property,
See generally 11 U.S.C.
§ 101(16), (49) (2000) (stock options are a right to purchase);
In re Tobiason,
. We have here described the bedrock distinction in contract law between the operation of conditions precedent and conditions subsequent. The distinction is discussed at some greater length later in this decision. See discussion infra.
. For what it is worth) Professor Arthur L. Corbin, of Yale University and the author of the well-known treatise on contract law, had little use for the word "vesting” as a useful legal term:
The terms "vested right” and "expectancy” are troublesome terms that have often been used to explain a decision without explaining it. The ideas behind them are so variable and uncertain as to make their use both deceptive and confusing. It is clear that the fact that rights are future and conditional does not prevent their recognition and protection; they are within the protection of the Constitutional provision against impairment of obligation by a state. A contract creating such rights is legally effective according to its terms; ... the existence of a "contract right” is not denied merely because the money is payable in the future and only on the happening of an uncertain event or because someone has a power of termination or modification.
Arthur L. Corbin, Corbin on Contracts (One Vol. Ed.), § 626 at pp. 582-83 (West 1951).
. The debtor in Segerstrom stated post-petition that she thought that the insurance company had properly handled her claim. The insurance company claimed that, as a result of this statement, the debtor's trustee could not maintain a Stowers action against the insurance company for failing to take a settlement, resulting in a substantial judgment against the insured. Id.
. The Bankruptcy Code recognizes stock options as a kind of security. 11 U.S.C. § 101(16). Securities owned by a debtor as of the date of filing become property of the estate. See In re Allen, supra, at 862.
. In this case, the option was clearly “vested”, though there are limitations on how and
.
See
discussion
supra
at note 3. Of course, the debtor might choose to destroy the value of the Option post-petition by quitting his job, but that would not alter the approach to valuing the Option, because valuation is done as of the filing (as that is when the exemption is determined).
See Matter of Sandoval,
. The option price today is slightly below the quoted price for Tesoro stock — and "today” is about two months after the dreadful events of September 11, 2001, which caused the entire stock market to shed value.
. An obvious example: the estate succeeds to the debtor’s interest in a lawsuit against a company. Post-petition, before the suit goes to trial, the debtor (and principle witness) dies. Or, alternatively, post-petition, the debtor (and principle witness) testifies. One event diminishes the future value of the asset. The other event enhances the value. Neither event in any way affects the estate’s unqualified ownership of the lawsuit as an asset of the estate on the date the bankruptcy case is filed.
. Of course, with regard to a salaried individual who files chapter 7 bankruptcy, paychecks earned pre-petition (even if received post-petition) are property of the estate, while paychecks earned post-petition are clearly not
. Section 541(a)(6) includes a certain category of property of the estate, then contains a special exclusion of a subset of that category of property:
[The] estate is comprised of all the following property, wherever located and by whomever held:
Proceeds, product, offspring, rents, and or profits of or from property of the estate, except such as are earnings from services performed by an individual debtor after the commencement of the case.
11 U.S.C. § 541(a)(6). The category created by subsection (6) is property generated post-petition by pre-petition property that has come into the estate. The subcategory exclusion is any
such
property
(i.e.,
subcategoiy (6) property, such as proceeds or profits) that is properly characterized as earnings from services performed by an individual debtor. The section 541(a)(6) exclusion is
not
the device that shelters an ordinary individual debtor’s post-petition salary — those funds are already sheltered because they are (a) generated post-petition and (b) do not arise out of pre-petition property that may have come into the estate.
See
11 U.S.C. § 541(a)(1). The section 541(a)(6) exception is a much narrower exclusion designed to shelter the proceeds of a closely held business, such as a medical practice. Indeed, that is the context that has generated the most interesting litigation regarding the nature of the earnings exclusion.
See generally In re Herberman,
. And only sophistry could make the "right to exercise” an option a separate property interest. After all, an option that does not include the right to use it is no option at all, as an option itself is nothing more than the right to buy something in the future at a preset price. By its very nature, an option
is
a present
right
to
do
something in the future. If the something that one is to do in the future in fact is only acquired by future actions, then
. See discussion supra.
. There is an obvious exception, of course. Many companies compensate their executives with stock options on an annual basis, tied directly to the performance of the company, on the theory that positive performance by the executive leads to profitable performance of the company. The stock options in that scenario do represent compensation for work done and are truly earned. Often the executive will have an employment contract with the company that provides a formula .for the award of stock options, tied to company performance benchmarks. That sort of arrangement is not present here. The "nonqualified stock option agreement” here does not provide for the award of stock options on a formula tied to performance. It grants the entire option at the front end. The stock option grant is not tied to performance. It is instead self-denominated as an "inducement” to the employee to stay employed and not to leave.
See Matter of Baldwin-United Corp.,
.As venerable an authority as Corbin takes us back to first principles with a clarity that bears quotation:
[A] "condition” ... is defined as an operative fact, one on which the existence of some particular legal relation depends.... This means that it is a fact or event that affects legal relations; it is a cause of some change in those legal relations.
[BJefore speaking of a conditioning fact or event as a condition precedent or a condition subsequent we must know what it is to which we are relating it. Precedent to what? Subsequent to what? ... The use of these two terms is often very puzzling; and the reason is that they are used with respect to a fact or event, without indicating in any definite way what it is to which it is being related.
Conditions precedent ... are those facts and events, occurring subsequently to the making of a valid contract, that must exist or occur before there is a right to immediate performance, before there is a breach ofcontract duty, before the usual judicial remedies are available.
Conditions subsequent ... are those facts and events that occur after breach of contract duty and that terminate the right to immediate performance and also the right to a judicial remedy. The term could be used to denote those facts and events that occur after a contract has been made and operate as its discharge and termination, without regard to whether there has been a breach or not. By this usage, the facts and events would be related to the primary contractual rights and duties, rather than to the right and duty of immediate performance and breach thereof.
... conditions will be either precedent to the duty of immediate performance (and its breach) or subsequent to that duty (and its breach).
Arthur L. Corbin, Corbin on Contracts (One Vol.Ed.), §§ 627-28, at pp. 583-84, 585, 586, 587-88 (West 1952).
. In crafting his allocation formula, the Allen judge said:
Terms of the 1995 Agreement required that [the debtor] remain in Amoco's service for one year, or 366 days, before the First Group [of stock options] became exercisable. On January 10, 1997, he had remained with Amoco for more than 366 days. He had satisfied 100% of the conditions precedent to exercise. Therefore, 100% of the value of the options became property of the estate on January 10, 1997. Allen,226 B.R., at 867 .
. Though of course the company could, in its answer, insist that, if the option is reinstated, it could still not be exercised until the passage of time contemplated in the agreement. That mere passage of time, however, is not a condition precedent. In contract law, it is not even considered a condition at all. See Corbin, supra § 626 at 582.
. Rule 9(c) does not require detailed pleading of conditions precedent, but does require an averment that all conditions precedent have been performed or occurred. See C. Wright & A. Miller, 5 FedPract. & Proc.2d, § 1302 at 679 (West 1990).
. A debtor suffers an injury pre-petition, but the resulting claim for damages belongs to the trustee in bankruptcy — and the debtor must cooperate by testifying at trial post-petition!
See generally In re Ballard,
. The drafters of the Code accommodated the impulse to do equity, but not the way
Allen
did. Rather than creating a constellation of exceptions to what might be property of the estate, the Code instead gives individual debtors the right to
exempt
certain property, thus taking it back out of the estate. To the extent that stock options can be claimed as
exempt
under either the state or federal exemption schemes available to debtors by way of section 522, the debtor will be able to keep the options. However, courts are no more free to create new, non-stalutoiy exemptions than they are to engraft non-statutory exclusions.
See United States v. Smith,