U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 2001
[ ] TRANSITION REPORT UNDER SECTION 13 OF 15(D) OF THE
EXCHANGE ACT
For the transition period from ______________ to _______________
Commission file number 0-28879
E-TREND NETWORKS, INC.
(Exact name of small business issuer as specified in its charter)
DELAWARE 98-0348508
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
5919 - 3RD STREET, S.E., CALGARY, ALBERTA, CANADA T2H 1K3
(Address of principal executive offices)
(403) 252-7766
(Issuer's telephone number)
COOL ENTERTAINMENT, INC.
10900 N.E. 8TH STREET, SUITE 900, BELLEVUE, WASHINGTON 98004
(Former name, former address and former fiscal year,
if changed since last report)
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the last practicable date:
4,825,273 SHARES OF COMMON STOCK, $0.0001 PAR VALUE, AS OF
MARCH 31, 2001
Transitional Small Business Disclosure Format (check one); Yes No X
----- -----
Unaudited Interim Consolidated Financial Statements
E-TREND NETWORKS, INC.
Six months ended March 31, 2001 and 2000
(Expressed in U.S. dollars)
2
E-TREND NETWORKS, INC.
Consolidated Balance Sheets
(Expressed in U.S. dollars)
===============================================================================================================
March 31, September 30,
2001 2000
- ---------------------------------------------------------------------------------------------------------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents (notes 3 and 4) $ 791,548 $ 1,866,159
Accounts receivable 95,276 63,290
Due from related parties (note 5):
Summerhill Investment Corp., note receivable 316,977 -
Video Headquarters Inc. 300,547 207,716
Diz Investments Ltd. 16,970 6,293
Stockholder 22,824 -
Inventory 104,525 40,344
Prepaid expenses 27,811 773
----------------------------------------------------------------------------------------------------------
1,676,478 2,184,575
Advance to Video Headquarters Inc. (note 5) 352,496 231,709
Investment in Video Headquarters Inc. (note 6) 151,997 232,382
Property and equipment 376,957 266,641
Goodwill 164,777 175,169
- ---------------------------------------------------------------------------------------------------------------
$ 2,722,705 $ 3,090,476
===============================================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Bank indebtedness (note 3) $ - $ 74,816
Bank loan (note 4) 316,977 -
Accounts payable and accrued liabilities 565,561 201,585
----------------------------------------------------------------------------------------------------------
882,538 276,401
Notes payable (note 2) 138,789 -
Stockholders' equity (note 7):
Common shares 38,854 8,854
Additional paid-in capital 3,601,406 3,601,406
Deficit (1,980,104) (866,495)
Unrealized gain from investment (note 6) 8,692 89,102
Cumulative translation adjustment 32,530 (18,792)
----------------------------------------------------------------------------------------------------------
1,701,378 2,814,075
- ---------------------------------------------------------------------------------------------------------------
$ 2,722,705 $ 3,090,476
===============================================================================================================
See accompanying notes to interim consolidated financial statements.
3
E-TREND NETWORKS, INC.
Consolidated Statements of Operations and Deficit
(Expressed in U.S. dollars)
(Unaudited)
==================================================================================================================
Three months ended Six months ended
March 31, March 31,
--------------------------------- -----------------------------------
- ------------------------------------------------------------------------------------------------------------------
2001 2000 2001 2000
- ------------------------------------------------------------------------------------------------------------------
Sales $ 486,705 $ 188,135 $ 924,222 $ 188,135
Cost of sales 440,132 137,728 820,319 137,728
- ------------------------------------------------------------------------------------------------------------------
46,573 50,407 103,903 50,407
Expenses 455,556 46,254 957,992 340,250
Depreciation 23,447 15,453 33,673 15,453
Amortization of goodwill 6,702 5,000 10,034 5,000
Interest and other income (41,165) (3,327) (84,387) (3,327)
- ------------------------------------------------------------------------------------------------------------------
Net loss for the period (397,967) (12,973) (813,409) (306,969)
Other comprehensive income:
Unrealized gain from investment 8,692 - 8,692 -
Foreign currency translation
adjustment 26,342 - 51,322 -
-------------------------------------------------------------------------------------------------------------
35,034 - 60,014 -
- ------------------------------------------------------------------------------------------------------------------
Comprehensive loss $ (362,933) $ (12,973) $ (753,395) $ (306,969)
==================================================================================================================
Deficit, beginning of period $ (1,281,937) $ (349,335) $ (866,495) $ (55,339)
Charge for excess of
consideration given over net
assets acquired (note 2) (300,200) - (300,200) -
Net loss for the period (397,967) (12,973) (813,409) (306,969)
- ------------------------------------------------------------------------------------------------------------------
Deficit, end of period $ (1,980,104) $ (362,308) $ (1,980,104) $ (362,308)
==================================================================================================================
Net loss per common share,
basic and diluted $ (0.09) $ (0.00) $ (0.18) $ (0.07)
==================================================================================================================
Weighted average common
shares outstanding, basic 4,481,867 4,481,867 4,481,867 4,481,867
==================================================================================================================
See accompanying notes to interim consolidated financial statements.
4
E-TREND NETWORKS, INC.
Consolidated Statement of Stockholders' Equity
As at March 31, 2001
(Expressed in U.S. dollars)
(Unaudited)
==============================================================================================================
ISSUED COMMON SHARES
------------------------- Additional
paid-in
Number Amount capital
- --------------------------------------------------------------------------------------------------------------
Balance, September 30, 2000 8,853,734 $ 8,854 $ 3,601,406
Issued in exchange for property and equipment 30,000 30,000 -
----------------------------------------------------
8,883,734 38,854 3,601,406
======================================================================
Common shares of Cool Entertainment, Inc.
at time of acquisition (note 2) 38,340,636 13,488,710 -
Effect of 1:100 reverse stock split (37,957,230) - -
- ----------------------------------------------------------------------
383,406
Issued in exchange for common shares
of Cool Entertainment, Inc. (note 2) 4,441,867 - -
Elimination of Cool Entertainment, Inc.
share capital under reverse-take-over
accounting - (13,488,710) -
- --------------------------------------------------------------------------------------------------------------
Balance, March 31, 2001 4,825,273 $ 38,854 $ 3,601,406
==============================================================================================================
See accompanying notes to interim consolidated financial statements.
5
E-TREND NETWORKS, INC.
Consolidated Statements of Cash Flows
(Expressed in U.S. dollars)
(Unaudited)
===============================================================================================================
Three months ended Six months ended
March 31, March 31,
--------------------------------- -----------------------------------
2001 2000 2001 2000
- ---------------------------------------------------------------------------------------------------------------
Cash was provided by (used for):
Operating activities:
Net loss for the period $ (397,967) $ (12,973) $ (813,409) $ (306,969)
Add items not involving
cash:
Depreciation 23,447 15,453 33,673 15,453
Amortization of goodwill 6,702 5,000 10,034 5,000
----------------------------------------------------------------------------------------------------------
Funds provided by (used in)
operations (367,818) 7,480 (769,702) (286,516)
Net change in non-cash
working capital (22,476) (10,578) (237,869) (87,302)
----------------------------------------------------------------------------------------------------------
(390,294) (3,098) (1,007,571) (373,818)
Financing activities:
Decrease in bank
indebtedness (82,547) - (74,816) -
Due from related company (17,649) (155,529) (107,528) (210,441)
Proceeds from bank loan - - 316,977 -
Proceeds from capital
contributions - 2,397,451 - 2,397,451
----------------------------------------------------------------------------------------------------------
(100,196) 2,241,922 134,633 2,187,010
Investing activities:
Acquisition (168,000) - (168,000) -
Purchase of property and
equipment (1,064) (60,013) (33,673) (122,439)
----------------------------------------------------------------------------------------------------------
(169,064) (60,013) (201,673) (122,439)
- ---------------------------------------------------------------------------------------------------------------
Increase (decrease) in cash
and cash equivalents (659,554) 2,178,811 (1,074,611) 1,690,753
Cash and cash equivalents,
beginning of period 1,451,102 150,654 1,866,159 638,712
- ---------------------------------------------------------------------------------------------------------------
Cash and cash equivalents,
end of period $ 791,548 $ 2,329,465 $ 791,548 $ 2,329,465
===============================================================================================================
See accompanying notes to interim consolidated financial statements.
6
E-TREND NETWORKS, INC.
Notes to Consolidated Financial Statements
Six months ended March 31, 2001 and 2000
(Expressed in U.S. dollars)
(Unaudited)
================================================================================
1. BASIS OF PRESENTATION:
These unaudited interim consolidated financial statements of E-Trend
Networks, Inc. ("E-Trend" or the "Company") have been prepared in
accordance with United States generally accepted accounting principles for
interim financial information, including all normal recurring adjustments
that are, in the opinion of management, necessary for the fair presentation
of the consolidated balance sheet and the consolidated statements of
operations and deficit, stockholders' equity and cash flows for the interim
period. The financial information included herein is unaudited; however,
there have been no changes to the accounting policies as detailed in the
Company's audited financial statements for the year ended September 30,
2000 during the interim periods presented. As a result, these interim
financial statements should be read in conjunction with the Company's
audited financial statements for the year ended September 30, 2000.
2. ACQUISITION:
Effective February 21, 2001 an arrangement was completed between E-Trend
Networks, Inc. and Cool Entertainment, Inc. ("Cool") whereby the
shareholders of E-Trend Networks, Inc. exchanged all of their common shares
for 4,441,867 common shares of Cool.
Following the acquisition the former shareholders of E-Trend Networks, Inc.
held a majority of the total issued and outstanding common shares of Cool;
E-Trend Networks, Inc. was thereby deemed to be the acquiror. Accordingly,
the transaction has been accounted for as a reverse-take-over using the
purchase method whereby the assets and liabilities of Cool have been
recorded at their fair market values and operating results have been
included in the Company's financial statements from the effective date of
purchase. The fair value of the net assets acquired is equal to their book
values. The excess of $300,200 of the consideration given over the net
assets acquired has been recognized as a capital transaction and charged
directly to the deficit.
7
E-TREND NETWORKS, INC.
Notes to Consolidated Financial Statements, page 8
Six months ended March 31, 2001 and 2000
(Expressed in U.S. dollars)
(Unaudited)
================================================================================
2. ACQUISITION (CONTINUED):
The acquisition is summarized as follows:
==========================================================================================================
Net assets acquired:
Property and equipment $ 78,940
Working capital deficiency (72,351)
----------------------------------------------------------------------------------------------------------
$ 6,589
==========================================================================================================
Consideration:
Cash $ 168,000
Note payable, to be settled by the issuance of 25,000 common shares 93,789
Note payable, to be settled by the issuance of 15,000 common shares 45,000
----------------------------------------------------------------------------------------------------------
306,789
Less excess of consideration given over net assets acquired 300,200
----------------------------------------------------------------------------------------------------------
$ 6,589
==========================================================================================================
Other transactions relating to the arrangement were as follows:
(a) Change of the Company's name from Cool Entertainment, Inc. to E-Trend
Networks, Inc.
(b) Redomestication of the Company to the State of Delaware from the
State of Nevada.
(c) Reverse stock split of 1-for-100 common shares.
(d) Continuance, on an equivalent basis, of all of the unexpired and
unexercised outstanding stock options and warrants of the former
E-Trend Networks, Inc. under the same terms and conditions.
(e) Cancellation of 900,000 outstanding warrants of Cool and continuance,
on an equivalent basis, of all remaining warrants of Cool under the
same terms and conditions.
(f) A note payable of $93,789 to Fictional Media Inc. is to be settled by
way of the issuance of 25,000 common shares.
(g) A cash payment of $23,000 and the issuance of a promissory note of
$45,000 by E-Trend to Fictional Media Inc., a company controlled by
stockholders of Cool, in exchange for property and equipment; the
note is to be settled by way of the issuance of 15,000 common shares.
3. BANK INDEBTEDNESS:
The Company has a line of credit with a limit of $150,000 Canadian.
Drawings bear interest at prime rate plus 1/2% and are secured by a
$150,000 U.S. deposit included in cash and cash equivalents.
8
E-TREND NETWORKS, INC.
Notes to Consolidated Financial Statements, page 9
Six months ended March 31, 2001 and 2000
(Expressed in U.S. dollars)
(Unaudited)
================================================================================
4. BANK LOAN:
At March 31, 2001 the Company had a demand bank loan of $500,000 Canadian
with interest at prime rate and secured by $500,000 U.S. in a money market
investment included in cash and cash equivalents. The loan was repaid in
full subsequent to March 31, 2001.
5. RELATED PARTY TRANSACTIONS:
(a) Summerhill Investment Corp.:
Summerhill Investment Corp. is a shareholder of the Company. The note
receivable is for $500,000 Canadian, bears interest at 20% and is
unsecured. For the three and six months ended March 31, 2001 the
Company accrued interest of $16,139 and $29,471, respectively, of
which $5,559 remain in accounts receivable at March 31, 2001. The
note was repaid in full subsequent to March 31, 2001.
(b) Video Headquarters Inc.:
Video Headquarters Inc. ("VHQ") represents the Company's major
stockholder. The advance to VHQ is for $515,000 Canadian, bears
interest at 8%, is unsecured and has no fixed terms of repayment. For
the three and six months ended March 31, 2001 the Company accrued
interest income of $6,985 and $13,698, respectively, (2000 - $4,740
and $9,050).
During the three and six months ended March 31, 2001 the Company sold
$264,083 and $471,493, respectively, (2000 - $156,319 for both
periods) of its products to VHQ, representing 54% and 51% of total
sales (2000 - 83% for both periods). These transactions are
considered to be in the normal course of business and are measured at
the exchange amount which is the amount of consideration established
and agreed to by the related parties.
Included in due from VHQ at March 31, 2001 is $293,576 (2000 -
$207,716) relating to sales to VHQ and $6,971 (2000 - $nil) relating
to an advance to VHQ for share purchases.
(c) Diz Investments Ltd.:
During the three and six months ended March 31, 2001 the Company sold
$57,809 (2000 - $nil) of its product to Diz Investments Ltd., a
company owned by two of the Company's stockholders. These
transactions are considered to be in the normal course of business
and are measured at the exchange amount which is the amount of
consideration established and agreed to by the related parties.
(d) Stockholder:
Included in accounts receivable is $22,824 relating to an advance to
a stockholder to purchase common shares of the Company. The subject
shares serve as security for the advance.
9
E-TREND NETWORKS, INC.
Notes to Consolidated Financial Statements, page 10
Six months ended March 31, 2001 and 2000
(Expressed in U.S. dollars)
(Unaudited)
================================================================================
6. INVESTMENT:
On January 21, 2000 the Company purchased 99,900 common shares of Video
Headquarters Inc., a publicly-traded Canadian company, in exchange for
100,000 shares of the Company at an assigned value of $150,000.
=========================================================================================================
March 31, 2001
------------------------------------------------------
Translated Unrealized Recorded
cost basis gain basis
---------------------------------------------------------------------------------------------------------
Video Headquarters Inc. common shares $ 143,285 $ 8,692 $ 151,977
=========================================================================================================
7. SHARE CAPITAL:
There were 767,160 stock options outstanding at March 31, 2001 having a
weighted average exercise price of $5.99 and expiring on various dates to
December 2004.
There were 100,000 common share purchase warrants outstanding at March 31,
2001 each warrant entitling the holder to purchase one common share of the
Company for $4.00 and expiring on April 20, 2002. These warrants were
issued in connection with the acquisition of Langara Distribution Inc.
Effective April 20, 2001 the Board of Directors approved a resolution to
change the Company's authorized share capital from 20,000,000 preferred
shares with a par value of $0.0001 per share and 80,000,000 common shares
with a par value of $0.0001 per share to:
1,000,000 preferred shares with a par value of $0.0001 per share
20,000,000 common shares with a par value of $0.0001 per share
10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This Management's Discussion and Analysis (MD&A) focuses on key statistics from
the consolidated financial statements of E-Trend for the fiscal quarter ended
March 31, 2001, and pertains to known risks and uncertainties relating to its
businesses. This MD&A should not be considered all-inclusive, as it excludes
changes that may occur in general economic, political and environmental
conditions. This MD&A of the financial condition and results of operations for
the quarter ended March 31, 2001 should be read in conjunction with the
consolidated financial statements and related notes of E-Trend.
RESULTS OF OPERATIONS
The company is considered to be in the early stages of implementing its business
plan, since it has not generated significant revenues and is continuing to
develop its business, particularly the Web-based site that is currently in its
initial customer acquisition phase. The site (EntertainMe.com) and traditional
distribution via Langara Distribution Inc., a wholly owned subsidiary of
E-Trend, will be the engine that drives future growth.
Sales for the three months ended March 31, 2001 increased approximately $49,188
over the previous quarter and $298,570 over the comparable quarter of the
previous fiscal year. Similarly, sales of the six months ended March 31, 2001
increased 391% from the previous fiscal year, since commercial launch of the
company's retail web sites did not take place until October 2000. The company
notes increased traffic on the website, as E-Trend increases its marketing
initiatives affiliations with other sites.
Gross margins decreased to 9.6% for the three months ended March 31, 2001 and
11.2% for the six-month period, from 26.8% for fiscal 2000 periods because of a
price increase from the company's suppliers at the beginning of the quarter that
was not passed on to customers until close to the end of the quarter.
Operating and development costs continue to rise because of the need to take on
the services of an external contractor to complete the website design and
testing. These costs, of approximately $32,000 per month, will be eliminated at
the end of June 2001.
Net loss for the quarter was $397,967, compared to $415,442 for the previous
quarter and $12,973 for the same quarter of the previous fiscal year. The net
loss for the six-month period increased to $813,409 from $306,969 from fiscal
2000.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 2001, the company had a working capital surplus of $793,940
compared to a surplus of $1,908,174 at September 30, 2000.
To date, virtually all of the company's resources have been provided from the
sale of common stock. At the current rate of expenditure, additional funds from
the sale of common stock or debt will have to be secured to enable the company
to continue to operate.
BUSINESS RISKS AND MANAGEMENT
The e-commerce sales and distribution of filmed entertainment, video games and
music is very competitive. E-Trend faces a number of competitors, with
competition existing on a global basis. The main competitive factors are
availability, price and service.
11
Management continues to review and assess its competitors, and is continually
vigilant for industry trends.
To be successful, E-Trend must increase sales. To do this, it must rely on
working capital and outside sources of capital to finance current operations and
new marketing initiatives designed to drive additional traffic.
THE FUTURE
The E-Trend Board of Directors and management are confident that the company is
on the right track for significant gains in the future. The news media has been
rife with reports of e-commerce failures, among them many of E-Trend's
competitors. However, overall internet sales continue to increase as consumers
become more comfortable with the security of the systems. E-Trend continues to
believe that its strategy of being a `second tier' online company will allow it
to take advantage of the tremendous number of online purchases in its product
categories - especially as its first-mover competition continues to experience
financial trouble.
E-Trend will continue to seek strategic alliances and acquisitions that will
complement its existing business and overall corporate strategy as expressed in
its business plan.
E-Trend is poised to implement key strategic initiatives that will include:
o increasing the number of music titles carried in Langara's inventory,
o adding DVD and key VHS titles to the Langara product mix,
o amending movie purchasing agreements to reduce product cost,
o improving the data model and overall scalability of the e-commerce
engine,
o improving site capacity to seamlessly manage the planned increase in
site traffic and sales volumes,
o merging the company's three internet sites (MovieSource.com,
VHQMusic.com and EntertainMe.com) into one brandable entertainment-
focused supersite,
o initiating new online marketing campaigns,
o implementing new software to enable seamless B2B2C (Business to Business
to Consumer) applications,
o obtaining new equity capital, and
o adding strategic alliances to expand the reach of entertainment
products.
FORWARD-LOOKING STATEMENTS
Certain statements in this Quarterly Report on Form 10-QSB, as well as
statements made by the company in periodic press releases, oral statements made
by the company's officials to analysts and shareholders in the course of
presentations about the company, constitute "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks, uncertainties, and
other factors that 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 the forward looking statements. Such
factors include, among other things, (1) general economic and business
conditions; (2) interest rate changes; (3) the relative stability of the debt
and equity markets; (4) competition; (5) demographic changes; (6) government
regulations particularly those related to Internet commerce; (7) required
accounting changes; (8) equipment failures, power outages, or other events that
may interrupt Internet communications; (9) disputes or claims regarding the
company's proprietary rights to its software and intellectual property; and (10)
other factors over which the company has little or no control.
12
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not Applicable.
ITEM 2. CHANGES IN SECURITIES
In February 2001, the registrant issued 4,441,867 shares to the
former shareholders of E-Trend Networks, Inc. in exchange for their
shares of E-Trend stock. The registrant relied upon the exemption
from registration contained in Rule 506 of Regulation D and Section
4(2) of the Securities Act of 1933. No underwriters were used and no
underwriting commissions were paid.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The registrant's shareholders held a special meeting on January 26,
2001 shareholders at which the following matters were acted upon:
- --------------------------------------------------------------------------------
ABSTENTIONS
VOTES CAST AND BROKER
MATTER VOTES CAST FOR AGAINST NON-VOTES
- --------------------------------------------------------------------------------
Reincorporation 21,745,383 0 0
merger
- --------------------------------------------------------------------------------
Acquisition of 21,745,383 0 0
E-Trend
- --------------------------------------------------------------------------------
Adoption of Stock 21,745,383 0 0
Option Plan
- --------------------------------------------------------------------------------
ITEM 5. OTHER INFORMATION
Not Applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A) EXHIBITS
- ------------------------------------------------------------------------------------------------------------------
REGULATION CONSECUTIVE
S-B NUMBER EXHIBIT PAGE NUMBER
- ------------------------------------------------------------------------------------------------------------------
2.1 Share Exchange Agreement, dated as of December 22, 2000, by and among N/A
E-Trend Networks, Inc., Cool Entertainment, Inc., and E-Trend Networks, Inc.
(a Delaware corporation) (1)<F1>
- ------------------------------------------------------------------------------------------------------------------
2.2 Agreement and Plan of Reincorporation and Merger between Cool Entertainment, N/A
Inc. and E-Trend Networks, Inc., a Delaware corporation (1)<F1>
- ------------------------------------------------------------------------------------------------------------------
13
- ------------------------------------------------------------------------------------------------------------------
REGULATION CONSECUTIVE
S-B NUMBER EXHIBIT PAGE NUMBER
- ------------------------------------------------------------------------------------------------------------------
2.3 Certificate of Ownership Merging Cool Entertainment, Inc. into E-Trend N/A
Networks, Inc. Pursuant to Section 253 of the Delaware General Corporation
Law and Articles of Merger Pursuant to Section 7-111-105 of the Colorado
Business Corporation Act
- ------------------------------------------------------------------------------------------------------------------
- ----------------------------
<FN>
(1)<F1> Incorporated by reference to the exhibits filed with the registrant's
definitive information statement filed January 2, 2001 for the meeting
held January 26, 2001.
</FN>
B) REPORTS ON FORM 8-K:
On February 22, 2001, the registrant filed a current report on Form
8-K dated February 21, 2001 reporting under Items 1, 2, and 5, the
consummation of the acquisition of E-Trend Networks, Inc. E-Trend's
historical audited financial statements and pro forma combined
financial statements were filed.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
E-TREND NETWORKS, INC.
(Registrant)
Date: May 16, 2001 By: /s/ CAROLINE ARMSTRONG
-------------------------------------------
Caroline Armstrong
President and Chief Executive Officer
By: /s/ LORNE COGSWELL
-------------------------------------------
Lorne Cogswell
Interim Chief Financial Officer
14