UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002
Commission File Number 0-14096
Foreland Corporation
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(Exact name of small business issuer as specified in its charter)
Nevada
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(State or other jurisdiction of incorporation or organization)
87-0422812
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(I.R.S. Employer Identification No.)
2561 South 1560 West
Woods Cross, Utah
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(Address of principal executive offices)
(801) 298-9886
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(Issuer's telephone number)
n/a
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(Former name, former address and former fiscal year,
if changes since last report)
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date. As of November 13, 2002,
issuer had 9,875,894 shares of issued and outstanding common stock, par value
$0.001.
Transitional Small Business Disclosure Format: Yes [ ] No [X]
PART I--FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
September 30, 2002 and December 31, 2001
Balance Sheets
ASSETS
September 30, December 31,
2002 2001
(Unaudited)
------------------ ------------------
CURRENT ASSETS
Cash $ 20,80 $ -
Prepaid expenses - 2,165
Lease sale receivable - 121,615
Inventory - pipe 42,395 42,395
------------------ ------------------
Total Current Assets 63,203 166,175
------------------ ------------------
LONG-TERM ASSETS
Office equipment, net 4,303 3,970
Unproved oil and gas properties 15,963 20,693
Deposits 75,330 75,000
------------------ ------------------
Total Long-Term Assets 95,596 99,663
------------------ ------------------
Total Assets $ 158,799 $ 265,838
================== ==================
The accompanying notes are an integral part of these financial statements.
2
FORELAND CORPORATION
Balance Sheets (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
September 30, December 31,
2002 2001
(Unaudited)
------------------ ------------------
CURRENT LIABILITIES
Checks issued in excess of cash in bank $ - $ 14,721
Accounts payable 529,540 547,533
Notes payable 600,000 600,000
Notes payable - related party 30,000 36,000
Interest payable 85,050 52,200
Interest payable - related party - 720
Officers' salaries - related parties 37,200 37,200
------------------ ------------------
Total Current Liabilities 1,281,790 1,288,374
------------------ ------------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDER'S EQUITY (DEFICIT)
Convertible preferred stock, $0.001 par value, 5,000,000
shares authorized; 407,243 shares issued and outstanding 407 407
Common stock, $0.01 par value, 50,000,000 shares
authorized; 9,875,894 shares issued and outstanding 9,876 9,876
Additional paid-in capital 39,322,891 39,322,891
Accumulated deficit (40,456,165) (40,355,710)
------------------ ------------------
Total Stockholders' Equity (Deficit) (1,122,991) (1,022,536)
------------------ ------------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 158,799 $ 265,838
================== ==================
The accompanying notes are an integral part of these financial statements.
3
FORELAND CORPORATION
Statements of Operations
(Unaudited)
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
---------------------------------- --------------------------------------
2002 2001 2002 2001
---------------- --------------- ------------------ ------------------
REVENUE
Prospect revenue $ - $ 6,840 $ - $ 117,280
Gain on sale of undeveloped
leaseholds 68,107 - 182,180 -
---------------- --------------- ------------------ ------------------
Total Revenue 68,107 6,840 182,180 117,280
---------------- --------------- ------------------ ------------------
EXPENSES
Oil exploration - 30,524 - 63,156
General and administrative 65,209 26,415 218,722 73,194
Depreciation and amortization 859 1,260 2,257 2,520
---------------- --------------- ------------------ ------------------
Total Expenses from
Operations 66,068 58,199 220,979 138,870
---------------- --------------- ------------------ ------------------
INCOME (LOSS) BEFORE OTHER
INCOME (EXPENSE) 2,039 (51,359) (38,799) (21,590)
---------------- --------------- ------------------ ------------------
OTHER INCOME (EXPENSE)
Interest income 330 555 848 1,171
Interest expense (20,709) (14,250) (62,504) (28,500)
---------------- --------------- ------------------ ------------------
Total Other Income (Expense) (20,379) (13,695) (61,656) (27,329)
---------------- --------------- ------------------ ------------------
NET LOSS (18,340) (65,054) (100,455) (48,919)
Preferred stock dividend (85,680) (68,250) (257,040) (68,250)
---------------- --------------- ------------------ ------------------
NET LOSS APPLICABLE
TO COMMON STOCKHOLDERS $ (104,020) $ (133,304) $ (357,495) $ (117,169)
================ =============== ================== ==================
LOSS PER SHARE
OF COMMON STOCK $ (0.01) $ (0.01) $ (0.04) $ (0.01)
================ =============== ================== ==================
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 9,875,894 9,742,323 9,875,894 9,742,323
================ =============== ================== ==================
The accompanying notes are an integral part of these financial statements.
4
FORELAND CORPORATION
Statements of Cash Flows
(Unaudited)
For the Nine Months Ended
September 30,
--------------------------------------
2002 2001
------------------ ------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (100,455) $ (48,919)
Depreciation and amortization 2,257 2,520
Changes in operating assets and liabilities 142,317 (57,701)
------------------ ------------------
Net Cash Provided by (Used in) Operations 44,119 (104,100)
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CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets (2,590) -
------------------ ------------------
Net Cash Used in Investing Activities (2,590) -
------------------ ------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from note payable - 10,000
Repayment of note payable (6,000) -
Repayment of cash overdraft (14,721) -
------------------ ------------------
Net Cash Provided by (Used in) Financing Activities (20,721) 10,000
------------------ ------------------
INCREASE (DECREASE) IN CASH 20,808 (94,100)
CASH, BEGINNING OF PERIOD - 98,298
------------------ ------------------
CASH, END OF PERIOD $ 20,808 $ 4,198
================== ==================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest $ 2,880 $ -
Cash paid for income taxes $ - $ -
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING
AND FINANCING ACTIVITIES
Options for debt $ - $ 546,737
The accompanying notes are an integral part of these financial statements.
5
FORELAND CORPORATION
Notes to the Financial Statements
September 30, 2002 and 2001
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
The accompanying financial statements have been prepared by the Company
without audit. In the opinion of management, all adjustments (which
include only normal recurring adjustments) necessary to present fairly
the financial position, results of operations and cash flows at
September 30, 2002 and 2001 and for all periods presented have been
made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting principles
generally accepted in the United States of America have been condensed
or omitted. It is suggested that these condensed financial statements
be read in conjunction with the financial statements and notes thereto
included in the Company's December 31, 2001 audited financial
statements. The results of operations for the period ended September
30, 2002 and 2001 are not necessarily indicative of the operating
results for the full years.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using accounting
principles generally accepted in the United States of America
applicable to a going concern which contemplates the realization of
assets and liquidation of liabilities in the normal course of business.
The Company does not have significant cash or other material assets,
nor does it have an established source of revenues sufficient to cover
its operating costs and to allow it to continue as a going concern. The
ability of the Company to continue as a going concern is dependent on
the Company obtaining adequate capital to fund operating losses until
it becomes profitable. If the Company is unable to obtain adequate
capital, it could be forced to cease operations.
In order to continue as a going concern, develop a reliable source of
revenues, and achieve a profitable level of operations the Company will
need, among other things, additional capital resources. Management's
plans to continue as a going concern include seeking additional capital
and pursuing its oil exploration through funding by outside investors.
However, management cannot provide any assurances that the Company will
be successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent
upon its ability to successfully accomplish the plans described in the
preceding paragraph and eventually secure other sources of financing
and attain profitable operations. The accompanying financial statements
do not include any adjustments that might be necessary if the Company
is unable to continue as a going concern.
6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Foreland's Current Precarious Financial Condition
Foreland is suffering from extreme shortages of working capital, due or
past due current liabilities, and the need for substantial amounts of additional
investment, strategic alliances or a sale, merger or reorganization involving
all or portions of its business and operations.
o Foreland Has Substantial Working Capital and Stockholders'
Deficits. As of September 30, 2002, Foreland had current
assets of $63,203 and current liabilities of $1,281,790, for a
working capital deficit of $1,218,587. In addition, as of such
date, Foreland had total assets of $158,799 and total
liabilities of $1,281,790 for a stockholders' deficit of
$1,122,991. As of September 30, 2002, Foreland had an
accumulated deficit of approximately $40.5 million.
o Many of Foreland's Obligations Are Substantially Past Due. Of
Foreland's $1,281,790 in current liabilities as of September
30, 2002, over $682,000 were substantially past due. Payment
of an additional $600,000, plus interest, due Petro Source and
acquired by CHL has been deferred under Foreland's agreement
with CHL. Three creditors with claims aggregating $458,000 at
September 30, 2002, have obtained judgments against Foreland.
See Part II, Item 1. Legal Proceedings.
o Foreland Has No Revenue or Cash. Other than funds advanced
under terms of the CHL agreement, Foreland has little cash or
other financial resources and no revenue from operations or
other activities, but must rely on raising additional capital
to pay creditors.
o Foreland Has Very Limited Assets on which To Base a Financial
Recovery. As a result of the voluntary surrender of the
collateral securing its indebtedness and the CHL agreement,
Foreland's remaining assets consist of the option to reacquire
the database and key leases and miscellaneous pipe and
equipment.
o Foreland Has No Liquidity or Cash with which To Reactivate. As
a result of the voluntary surrender of the collateral securing
its indebtedness, Foreland's only ability to generate revenues
is through finding a drilling partner for one or all of its
Nevada prospects now owned by CHL, and upon successful
drilling, exercising its option to reacquire the leases and
database. Absent the CHL funding, Foreland has insufficient
cash to maintain its exploration leaseholds, pay its
personnel, satisfy claims of creditors, or undertake oil and
gas exploration.
o Foreland's Audit Report for the Year Ended December 31, 2001,
Contains a Going Concern Explanatory Paragraph. Foreland's
independent auditor's report on the December 31, 2001
financial statements, as for preceding fiscal years, contains
an explanatory paragraph that indicates there is substantial
doubt as to Foreland's ability to continue as a going concern.
o Possible Inability To Continue. As a result of all of the
foregoing, Foreland urgently needs additional capital, but
because of its precarious condition and limited assets, may be
unable to attract any capital or sufficient capital to
continue.
Results of Operations
Quarters ended September 30, 2002 and 2001
During the quarter ended September 30, 2002, Foreland reported revenue
of $68,107, resulting principally from the sale of undeveloped leaseholds, which
represented a significant increase from the $6,840 received in the previous
year, during which Foreland had revenue from the sale of geological and
geophysical information and payments related to its Nevada Exploration Agreement
with Farakel Company.
7
Total expenses from operations were approximately $66,068 for the
quarter ended September 30, 2002, as compared to $58,199 during the same period
in the preceding fiscal year. The increase during the 2002 interim period is due
principally to a an increase in general and administrative expenses in the three
months ended September 30, 2002, as compared to the same period in 2001.
After accrual of a dividend on preferred stock of $85,680, for the
quarter ended September 30, 2002, Foreland reported a net loss applicable to
common stockholders of $104,020, as compared to a loss of $133,304 for the
quarter ended September 30, 2002. The dividend on preferred stock is accrued for
financial reporting purposes, but not paid.
Nine Months Ended September 30, 2002 and 2001
During the nine months ended September 30, 2002, Foreland reported
revenue of $182,180, resulting from the sale of undeveloped leaseholds, which
represented a slight decrease from the $117,280 received in the previous year,
during which Foreland had revenue from the sale of geological and geophysical
information and payments related to its Nevada Exploration Agreement with
Farakel Company.
Total expenses from operations were approximately $220,979 for the nine
months ended September 30, 2002, as compared to $138,870 during the same period
in the preceding fiscal year. The increase during the 2002 interim period is due
principally to an increase in general and administrative expenses in the nine
months ended September 30, 2002, as compared to the same period in 2001, which
more than offset the $63,156 decrease in oil exploration expenses in the later
period.
After accrual of a dividend on preferred stock of $257,040 [Why so
high?/Explain], for the nine months ended September 30, 2002, Foreland reported
a net loss applicable to common stockholders of $357,495, as compared to a loss
of $117,169 for the nine months ended September 30, 2001. The dividend on
preferred stock is accrued for financial reporting purposes, but not paid.
Liquidity and Capital Resources
2002 Activities
Operating activities provided $44,119 in cash during the nine months
ended September 30, 2002, as compared to requiring $104,100 in cash required
during the same period 2001, principally due to changes in operating assets and
liabilities. Investing activities did not materially affect the use of cash
during either of the nine-month periods ended September 30, 2002 or 2001.
Financing activities required cash of $20,721 in the nine-months ended September
30, 2002, to cover a bank overdraft and repay a note payable, while financing
activities provided $10,000 from borrowings in the nine months ended September
30, 2001.
Current and Future Requirements
As of September 30, 2002, Foreland had current liabilities of
$1,281,790, with current assets of only $63,203, for a working capital deficit
of $1,218,587. Current liabilities include an aggregate of $458,000 due on
judgments obtained by creditors and a $600,000 plus interest, note due to CHL as
successor to the Petro Source settlement. Foreland will seek to negotiate the
continued forbearance, compromise, partial forgiveness, extension or other
resolution of all or a portion of the above claims. Nevertheless, Foreland
expects that a significant amount of cash will be required to reach any
accommodation with these creditors. Foreland cannot assure that it will be
successful in its efforts to reach a satisfactory resolution of these claims or
raise the cash required to pay any amounts that may be agreed to.
8
In some instances, Foreland may seek to satisfy creditors' claims by
issuing securities, which would dilute the interests of existing stockholders.
In March 2002, effective December 2001, Foreland sold its major assets
with a buyback option, to allow it an additional year to get the prospects
drilled. Under such an arrangement, Foreland would attempt to negotiate for its
share of costs to be paid by the other participants, retaining a minority
interest in the venture. Alternatively, Foreland may seek to raise funds through
the sale of equity or debt securities to provide its share of drilling funds and
for other corporate purposes. Foreland does not expect that it will be able to
obtain any additional financing from any source unless and until it is able to
reach agreements acceptable to investors with its various creditors so that
substantially all new money invested will be available for Nevada exploration
and not exposed to claims of current creditors. Foreland cannot predict the
amount of money that may be required to obtain the forbearance or compromise of
the claims of its existing creditors with claims aggregating approximately
$1,220,388. There is no assurance that Foreland will be successful in
accomplishing these tasks. Foreland's current requirements for general and
administrative expenses for 2002 are being advanced monthly by CHL.
Foreland is currently seeking additional capital through the sale of
securities to fund compromises of claims of creditors as well as future
operations. Any such sales to obtain the capital required would substantially
dilute the interests of current stockholders.
Because of its financial condition and the nature and amount of its
creditors' claims, Foreland may be susceptible to an involuntary petition under
the Bankruptcy Act seeking Foreland's liquidation. In addition, if Foreland is
unable to reach satisfactory accommodations with its creditors or immediately
obtain urgently required capital, it may be forced to seek protection under
Chapter 11 of the Bankruptcy Act while it seeks to reorganize its assets and
liabilities.
Inflation
Foreland's activities have not been, and in the near term are not
expected to be, materially affected by inflation or changing prices in general.
Foreland's oil exploration and production activities are generally affected by
prevailing sales prices for oil and the recent significant decreases in oil
prices have caused some activities to be uneconomic.
ITEM 3. CONTROLS AND PROCEDURES
Foreland maintains a system of internal controls and procedures
designed to provide reasonable assurance as to the reliability of its financial
statements and other disclosures included in this report. Foreland's board of
directors provides oversight to its financial reporting process.
Within the 90-day period prior to the date of this report, Foreland
evaluated the effectiveness of the design and operation of its disclosure
controls and procedures pursuant to Rule 13a-14 of the Securities Exchange Act
of 1934. Based upon that evaluation, Foreland's Chief Executive Officer and
Chief Financial Officer concluded that its disclosure controls and procedures
are effective in alerting him in a timely manner to material information
relating to Foreland required to be included in this quarterly report on Form
10-QSB.
There have been no significant changes in Foreland's internal controls
or in other factors that could significantly affect internal controls subsequent
to the date that it carried out its evaluation and there were no corrective
actions regarding significant deficiencies or material weaknesses.
9
PART II--OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Three trade creditors have judgments against Foreland in the aggregate
amount of $445,000 for services and materials provided in connection with its
Nevada exploration and drilling activities as follows: Halliburton Energy
Services, Inc. by the District Court, Jefferson County, Colorado, in the amount
of $53,000; Grant Geophysical Corp. by the United States District Court for the
Southern District of Texas, Houston Division, in the amount of $375,000; and
Spidle Sales and Service, Inc., by the Eighth Judicial District Court, Uintah
County, Utah, in the amount of $17,000.
A former employee of Foreland Refining Corporation, a former
subsidiary, filed suit against it and Foreland Corporation for breach of his
employment agreement with such subsidiary, claiming the company owes
approximately one year's pay. William Adair v. Foreland Corporation, et al.,
case no. CV0012192, in the Seventh Judicial District Court of Nevada for White
Pine County. The suit is deemed frivolous insofar as it involves Foreland
because the employee was terminated by the subsidiary after all of the stock of
such subsidiary was surrendered to E.I.F.
On April 3, 2002, Foreland filed its answer to the complaint in the
matter entitled Royal Surplus Lines Insurance v. Foreland Corporation,
Gallagher-Braniff, Inc., and John Does, civil no. 1:02CV00022J, filed in the
United States District Court for the District of Utah. Royal Surplus Lines
Insurance seeks to recover a $100,000 payment allegedly made by mistake pursuant
to an insurance policy issued to Foreland. Foreland asserted that the payment
was not made to it or for its benefit. Upon Foreland's motion, this claim
against Foreland has been dismissed with prejudice.
Other than the matters set forth above, Foreland is not a party to any
material proceeding, and none has been threatened by or, to the best of
Foreland's knowledge, against Foreland.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Cumulative dividends on 200,000 preferred shares, payable at 12% per
year, if, as, and when declared by the board of directors, have not been paid.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
10
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits: The following exhibits are included as part of this
report at the location indicated:
SEC
Exhibit Reference
Number Number Title of Document Location
- --------- -------- --------------------------------------------- --------------
Item 99 Certifications
- --------- -------- --------------------------------------------- --------------
99.01 99 Certification Pursuant to 18 U.S.C. Section This filing
1350, as adopted Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002
(Chief Executive Officer)
99.02 99 Certification Pursuant to 18 U.S.C. Section This filing
1350, as adopted Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002
(Chief Financial Officer)
(b) Reports on Form 8-K: During the quarter ended September 30,
2002, we did not file any reports on Form 8-K.
11
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.
FORELAND CORPORATION
Date: November 14, 2002 By /s/ Bruce C. Decker
-------------------------------------------
Bruce C. Decker, President
(Principal Executive and Financial Officer)
12
CERTIFICATION
I, Bruce C. Decker, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Foreland
Corporation;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 14, 2002
/s/ Bruce C. Decker
- --------------------------------
Bruce C. Decker
Principal Executive Officer
13
CERTIFICATION
I, Bruce C. Decker, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Foreland
Corporation;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in
this quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 14, 2002
/s/ Bruce C. Decker
- ----------------------------
Bruce C. Decker
Principal Financial Officer
14