U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarter ended: June 30, 2002
Commission file no.: 000-31935
L.L. Brown International, Inc.
--------------------------------------------
(Name of small business issuer in its charter)
Nevada 65-0729440
- ------------------------------- ----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
19435 68th Avenue South, Suite S-105
Kent, Washington 98032
- ----------------------------------------- ----------------------------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (425) 251-8086
Securities registered under Section 12(b) of the Exchange Act:
Name of each exchange on
Title of each class which registered
None None
- ----------------------------- -------------------------
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $0.001 par value
-----------------------------------
(Title of class)
Copies of Communications Sent to:
Mintmire & Associates
265 Sunrise Avenue, Suite 204
Palm Beach, FL 33480
Tel: (561) 832-5696
Fax: (561) 659-5371
Indicate by Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes X No
--- ----
As of June 30, 2002, there were 11,613,803 shares of voting stock of the
registrant issued and outstanding.
PART I
Item 1. Financial Statements
L.L. Brown International, Inc.
Consolidated Financial Statements
June 30, 2002 and 2001
L.L. Brown International, Inc.
INDEX
Page
Consolidated Financial Statements
Balance sheets...................................................F-1
Statements of operations.........................................F-2
Statements of stockholders' equity (deficit).....................F-3
Statements of cash flows.........................................F-4
Notes to financial statements....................................F-5
L.L. Brown International, Inc.
Consolidated Balance Sheets
June 30, 2002 and 2001
ASSETS
2002 2001
------------ ---------------
Current Assets
Cash and Cash Equivalents $ 4,933 $ 7
Accounts receivable net 57,729 22,648
Inventory 48,236 50,154
Deposits 7,260 7,854
Total current assets 118,158 80,663
Property and Equipment, net 32,464 48,972
Other Assets
Due from Stockholders 29,396 12,557
TOTAL ASSETS $ 180,018 $ 142,192
============ ===============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Bank Overdrafts $ --- $ 19,046
Accounts Payable 307,729 250,621
Notes Payable 9,525 22,164
Accrued payroll and business taxes 71,354 53,695
Current maturities of long-term debt 31,903 40,308
Total current liabilities 420,511 385,834
Long-term Debt, less current maturities 23,906 57,553
Stockholders' Equity (Deficit)
Preferred stock, $.001 par value, 1,000,000 shares authorized,
no shares issued
Common stock, $.001 par value, 20,000,000 shares authorized,
10,638,803 shares issued and outstanding in 2002, 10,638,803 shares issued and
outstanding in 2001
Additional paid-in capital 10,640 10,640
Accumulated deficit 604,628 604,628
(879,667) (916,463)
Total Stockholders' Equity (Deficit) (264,399) (301,195)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 180,018 $ 142,192
============ ===============
See accompanying notes
F-3
L.L. Brown International, Inc.
Consolidated Statements of Operations
For the Six Months And The Quarters Ended June 30, 2002 and 2001
2002 2001
---------------------------------- ------------------------------------
Quarter Year-to-Date Quarter Year-to-Date
-------------- ---------------- --------------- -----------------
Revenues $ 142,046 $ 302,409 $ 148,662 $ 255,600
Cost of Sales 88,490 105,104 55,358 153,653
-------------- ---------------- --------------- -----------------
Gross Profit 53,556 197,305 93,304 101,947
General & Administrative 90,601 $ 181,569 90,408 $ 210,117
-------------- ---------------- --------------- -----------------
Income (Loss) on Operations (37,045) 15,736 2,896 (108,170)
Interest expenses 1,577 4,724 3,309 8,168
-------------- ---------------- --------------- -----------------
Income (Loss) before Income Taxes (38,622) 11,012 (413) (116,338)
Income Taxes - - - -
Net Income (Loss) $ (38,622) $ 11,012 $ (413) $ (116,338)
============== ================ =============== =================
Net Income (Loss) per share
-basic and diluted $ (0.004) $ (0.001) $ (0.000) $ (0.011)
Weighted Average Basic
Shares Outstanding 10,638,803 10,596,303 10,638,803 10,553,803
============== ================ =============== =================
See accompanying notes
F-4
L.L. Brown International, Inc.
Consolidated Statements of Stockholders' Equity (Deficit
For the Six Months Ended June 30, 2002 and 2001
Common Stock Additional
------------ paid - in Accumulated
Beginning Balance Shares Amount capital Deficit Total
------- -------- ------- -------- ------
December 31, 2000 10,602,803 $ 10,604 $ 568,664 $ (800,125) $ (220,857)
Shares Purchased
Shares Issued as 36,000 36 35,964 36,000
Compensation (value $0.001)
Net Income (Loss) (116,338) (116,338)
Ending Balance
June 30, 2001 10,638,803 $ 10,640 $ 604,628 $ (916,463) $ (301,195)
=========== ========== ========== ============= ===========
Common Stock Additional
------------ paid - in Accumulated
Beginning Balance Shares Amount capital Deficit Total
------- -------- ------- -------- ------
December 31, 2001 10,638,803 $ 10,640 $ 604,628 $ (890,679) $ (275,411)
Shares Purchased
Shares Issued as
Compensation (value $0.001)
Net Income (Loss) 11,012 11,012
Ending Balance
June 30, 2002 10,638,803 $ 10,640 $ 604,628 $ ( 879,667) $ (264,399)
=========== ========== ========== ============= ===========
See accompanying notes
F-5
L.L. Brown International, Inc.
Consolidated Statements of Cash Flows
For the Six Months And The Quarters Ended June 30, 2002 and 2001
2002 2001
--------------------------- --------------------------
Year-to- Year-to-
Cash flows from operating activities: Quarter Date Quarter Date
----------- ----------- ----------- -----------
Net Income (Loss) (38,622) 11,012 (413) (116,,338)
Adjustments to reconcile net loss used in
operating activities:
Depreciation 3,011
Stock issued in Lieu of Cash Compensation 6,023 3,316 6,831
Changes in operating assets and liabilities 36,000
Accounts receivable 41,493
Inventory (12,500) (30,410) (316) 18,552
Deposits 594 (7,240) (2,548) 2,630
Accounts payable 29,835 594
Accrued liabilities 1,029 37,146 9,635 27,737
15,879 4,536 414
Total adjustments 63,462 21,992 14,578 92,164
----------- ----------- ----------- -----------
Net cash provided (used) in operating activities 24,840 33,004 14,165 (24,174)
----------- ----------- ----------- -----------
Cash flows from financing activities Proceeds from
issuance of long-term debt
Proceeds from issuance of common stock
Bank Overdrafts (17,267) - (11,023) 19,046
Net borrowings (payments) on notes payable 276 214
Principal payments on long-term debt (2,177) (18,343) (3,602) (7,325)
Net advances to stockholders (20,000)
Net cash provided by financing activities (19,444) (38,343) (14,349) 11,935
----------- ----------- ----------- -----------
Cash flows from Investing Activities
Purchases Property & Equipment (1,363) (1,363) (1,525)
----------- ----------- ----------- -----------
Net cash provided (used) by Investing
Activities (1,363) (1,363) (1,525)
Net increase(decrease) in cash 4,033 (6,702) (184) (13,764)
----------- ----------- ----------- -----------
Cash at Beginning of Period 900 11,635 191 13,771
Cash at June 30 $ 4,933 $ 4,933 $ 7 $ 7
=========== =========== =========== ===========
Supplemental disclosures of cash flow
information
Cash paid during the period for interest $ 1,577 $ 4,724 $ 3,309 $ 8,168
=========== =========== =========== ===========
See accompanying notes
F-6
L.L. Brown International, Inc.
Notes to Consolidated Financial Statements
June 30, 2002 and 2001
Note 1 - Organization
L.L. Brown International, Inc. ("The Company") is a Nevada Corporation that
conducts business from its headquarters in Kent, Washington. The Company was
incorporated in February 1997 as Smart Industries, Inc., and changed its name to
L.L. Brown International, Inc., in March 1998.
In March 1998, The Company acquired 100 percent of the issued and outstanding
shares of the common stock of L.L. Brown & Associates, Inc., a Washington
corporation, by issuing 8,900,000 shares of its stock.
The Company is an educational corporation that designs curriculum and programs
which are intended to teach people how to make positive changes in their lives.
The Company sells materials and delivers seminars to corporations, nonprofit
organizations, universities, welfare agencies, school districts, and youth
service agencies throughout the United States.
Note 2 - Summary of Significant Accounting Policies
Principles of consolidation
The consolidated financial statements include the accounts of L.L. Brown
International, Inc., and its wholly owned subsidiary L.L. Brown & Associates,
Inc. All significant intercompany balances and transactions have been
eliminated.
Accounts Receivable
Accounts receivable consists primarily of trade receivables, bad debts allowance
is accrued at 1% of net sales.
Inventories
Inventories consist of printed and audio/visual materials developed by the
Company and are stated at the lower cost or market based on the first-in,
first-out method.
Federal income tax
The provisions for income taxes is recorded in accordance with Statement of
Financial Accounting Standards No. 109 (SFAS 109), "Accounting for Income
Taxes". Under the liability method of SFAS 109, deferred tax assets and
liabilities are determined based on temporary differences between financial
reporting and tax bases of assets and liabilities and have been measured using
the enacted marginal tax rates and laws that are currently in effect. The types
of significant temporary differences include depreciation.
F-7
L.L. Brown International, Inc.
Notes to Consolidated Financial Statements
June 30, 2002 and 2001
Property and equipment
Property is stated at historical cost as detailed in Note 3. Major expenditures
for property and those that substantially increase the useful lives of property
are capitalized. Property is depreciated using the straight-line method over the
estimated useful lives of the assets, ranging between five and seven years.
Leased Property is stated at the lower of the present value of future minimum
lease payments or fair value of the property. Leased property is depreciated on
a straight-line basis over the shorter of the lease term or the estimated useful
lives ranging between five and seven years. Amortization of assets held under
capital leases is included in depreciation expense.
Management's Estimates and Assumptions
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenue and expenses during the
reporting period. Actual results could differ from those estimates.
Revenue Recognition
The Company recognizes revenue at the time of shipment of product to its
customers or completion of services provided.
Stock-based Compensation
The Company has chosen to account for stock-based compensation using the
intrinsic value method prescribed in Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees", and related Interpretations and to
elect the disclosure option of SFAS No. 123, "Accounting for Stock- Based
Compensation". Accordingly, compensation costs for stock options issued to
employees is measured as the excess, if any, of the quoted market price of the
Company's stock at the date of the grant over the amount an employee must pay to
acquire the stock.
Note 3 -- Property and Equipment
The following is a summary of property and equipment, at cost:
2002 2001
---- ----
Office Equipment $ 72,072 $ 85,584
Furniture & Fixtures 39,976 45,122
Vehicles 43,920 42,775
Leasehold improvements 6,227 6,227
$ 160,195 $ 179,708
Less: Accumulated depreciation & amortization (129,731) (130,736)
$ 32,464 $ 48,972
============= =============
F-8
.L. Brown International, Inc.
Notes to Consolidated Financial Statements
June 30, 2002 and 2001
Note 4 - Notes Payable
Notes payable to banks consisted of the following: 2002 2001
---- ----
The Company is obligated under a demand note payable to a
bank on which interest accrues at 9.75%. The note is secured
by substantially all trade receivables, inventory and
equipment. $ 9,525 $ 9,525
A line of credit under which the Company may borrow up to
$15,000, is payable to a bank in interest only installments
at 14.5% $ 0 $ 12,639
$ 9,525 $ 22,164
=========== =========
Note 5 - Long-term Debt
Long-term debt consists of the following: 2002 2001
---- ----
Note payable to a bank in monthly installments of $548
including interests at 9.75%, due December 2001, secured by
automobile, Vehicle was traded in on August 8, 2000, debt
was liquidated $ 0 $ 0
Lease payable to Renton Lincoln in monthly installments of
$543, with balloon payment of $18,226.60 at the end of 36
months, secured by automobile $ 28,793 $ 34,517
Note payable to a bank in monthly installments of $3,207
including interest at 9.75%, due October 2002, secured by
substantially all trade receivables, inventory and equipment $ 27,016 $ 63,344
----------- ----------
$ 55,809 $ 97,861
----------- ----------
Less current maturities $ 31,903 $ 40,308
Long-term debt, less current maturities $ 23,906 $ 57,553
=========== ==========
Minimum future payments under long-term debt agreements for each of the next
five years and in the aggregate are as follows:
Year ended June 30,
2003 $ 33,532
2004 6,516
2005 18,227
2006 -0-
2007 -0-
------------
$ 58,275
=============
F-9
L.L. Brown International, Inc.
Notes to Consolidated Financial Statements
June 30, 2002 and 2001
Note 6 - Advertising
Advertising costs are charged to operations when incurred, which amounted to
$-0- for 2002 and $1,773 for 2001.
Note 7 - Federal Income Taxes
At June 30, 2002 and 2001, the Company had net operating loss carry forwards of
approximately $830,000 and $800,000 respectively, expiring in year 2014. The
amount recorded as deferred tax assets as of June 30, 2002 and 2001 were
approximately $277,000 and $264,000 respectively, which represents the amount of
tax benefits arising from the loss of carry forwards. Due to the uncertainty
regarding the Company's ability to generate taxable income in the future to
realize the benefit from its deferred tax assets, the Company has established a
valuation allowance of $277,000 and $264,000 against this deferred tax asset.
Note 8 - Commitments
The Company leases its administrative offices and certain equipment under
operation leases expiring in 2003. The Company is obligated for minimum
non-cancelable rental payments under the lease through its term as follows:
Year ended June 30,
2002 27,960
2003 55,920
----------------------
$ 83,880
Note 9 - Related Party Transactions
The Company had advances of $29,396 and $12,557 to the Vice President as of June
30, 2002 and 2001 respectively.
Note 10 - Going Concern
As shown in the accompanying financial statements, the Company has incurred
continuing losses the recent years of operations. The ability of the Company to
continue as a going concern is dependent upon increasing sales and on obtaining
additional capital and financing. The financial statements do not include any
adjustments that might be necessary if the Company is unable to continue as a
going concern.
F-10
Item 2. Management's Discussion and Analysis of Results of Operations.
Discussion and Analysis
The Company has been engaged in the motivational training business since
its inception in February 1997. In March 1998, it acquired L.L. Brown and
Associates, Inc., a Washington corporation ("LLBA") formed in September 1992 as
a wholly-owned subsidiary, which was also engaged in the motivational training
business. Both the Company's and LLBA's founding philosophies arose from the
diversified experience of their management in the motivational training and
related industries.
The Company was formed in February 1997 and had little or no operations
until March, 1998, when it acquired LLBA. L.L. Brown is a public educational
corporation which designs and markets curricula and training materials that
teach people how to make positive changes in their lives. Its principle purpose
is to teach techniques in critical thinking, self-image psychology and self
motivation which helps people to improve the quality of their lives.
L.L. Brown's seminars and training material are widely used by
corporations, non-profit agencies, universities, social service agencies, school
districts and youth services agencies. The Company works with people to show
them that change is possible and shows organizations and their employees how to
become resilient, focused, goal oriented and innovative. They use techniques in
self-image psychology and mind/brain research and apply it to everyday
situations, such as transition and decision making. Their customers are taught
to achieve their personal and professional goals with an array of products and
services.
Results of Operations -For the Three and Six Months Ending June 30, 2002 and
June 30, 2001
Financial Condition, Capital Resources and Liquidity
For the 2nd quarter ended June 30, 2002 and 2001, the Company recorded
revenues of $142,046 and $148,662 respectively. For the six months ended June
30, 2002 and 2001, the Company recorded revenues of $302,409 and $255,600,
respectively.
For the 2nd quarter ended June 30, 2002 and 2001 the Company had general
and administrative expenses of $90,601 and $90,408 respectively. For the six
months ended June 30, 2002 and 2001, the Company had general and administrative
expenses of $181,569 and $210,117, respectively.
Net Income/Loss
For the 2nd quarter ended June 30, 2002 and 2001 the Company reported net
loss of $38,622 and $413. For the six months ended June 30, 2002, the Company
reported net income of $11,102. For the six months ended June 30, 2001, the
Company recorded a net loss of $116,338.
The ability of the Company to continue as a going concern is dependent upon
increasing sales and obtaining additional capital and financing. The Company is
currently seeking financing to allow it to continue its planned operations.
Employees
At June 30, 2002, the Company employed three (3) persons. None of these
employees are represented by a labor union for purposes of collective
bargaining. The Company considers its relations with its employees to be
excellent. The Company plans to employ additional personnel as needed upon
product rollout to accommodate fulfillment needs.
Research and Development Plans
The Company believes that research and development is an important factor
in its future growth. The self improvement and motivation industry is closely
linked to psychological advances,
13
which enhance the quality of the Company's products and services for its use by
the public. Therefore, the Company must continually invest in the latest
technology to appeal to the public and to effectively compete with other
companies in the industry. No assurance can be made that the Company will have
sufficient funds to research psychological advances as they become available.
Additionally, due to the rapid advance rate at which self-psychology advances,
the Company's research and materials may be outdated quickly, preventing or
impeding the Company from realizing its full potential profits.
Forward-Looking Statements
Certain statements contained in this quarterly filing, including, without
limitation, statements containing the words "believes", "anticipates", "expects"
and words of similar import, constitute forward-looking statements. 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, or industry results, to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.
Such factors include, among others, the following: international, national and
local general economic and market conditions: demographic changes; the ability
of the Company to sustain, manage or forecast its growth; the ability of the
Company to successfully make and integrate acquisitions; raw material costs and
availability; new product development and introduction; existing government
regulations and changes in, or the failure to comply with, government
regulations; adverse publicity; competition; the loss of significant customers
or suppliers; fluctuations and difficulty in forecasting operating results;
changes in business strategy or development plans; business disruptions; the
ability to attract and retain qualified personnel; the ability to protect
technology; and other factors referenced in this and previous filings.
Given these uncertainties, readers of this Form 10-QSB and investors are
cautioned not to place undue reliance on such forward-looking statements. The
Company disclaims any obligation to update any such factors or to publicly
announce the result of any revisions to any of the forward- looking statements
contained herein to reflect future events or developments.
PART II
Item 1. Legal Proceedings.
The Company knows of no legal proceedings to which it is a party or to
which any of its property is the subject which are pending, threatened or
contemplated or any unsatisfied judgments against the Company.
Item 2. Changes in Securities and Use of Proceeds
None.
Item 3. Defaults in Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted during the quarter ending June 30, 2002, covered by
this report to a vote of the Company's shareholders, through the solicitation of
proxies or otherwise.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) The exhibits required to be filed herewith by Item 601 of Regulation
S-B, as described in the following index of exhibits, are incorporated herein by
reference, as follows:
Exhibit No. Description
- ----------------------------------------------------------------------
2.1 [1] Share Exchange Agreement between L.L. Brown International, Inc. and LL Brown
& Associates, Inc. dated March 14, 1998.
3.(i).1 [1] Articles of Incorporation of Smart Industries, Inc. filed February 19, 1997.
3.(i).2 [1] Certificate of Amendment of Articles of Incorporation changing name to L.L. Brown
International, Inc. filed March 24, 1998.
3.(ii).1 [1] Bylaws of Smart Industries, Inc.
4.1 [1] Form of Private Placement Offering of 1,600,000 common shares at $0.01 per share
dated February 1997.
4.2 [1] Form of Private Placement Offering of 500,000 common shares at $1.00 per share
dated April 1998.
4.3 [1] Renumbered as Exhibit 10.12.
5.1 [6] Opinion of Mintmire & Associates.
10.1 [1] Consulting Agreement between Neil Rand of Corporate Imaging and L.L. Brown
dated March 2, 1998.
10.2 [1] Renumbered as Exhibit 2.1.
10.3 [1] Agreement between Steven Mundahl and Lester L. Brown to assist in writing
auto-biography, dated September 1998.
10.4 [1] Production Agreement between KBDI and Lester Brown dated September 1998.
10.5 [1] Standard Industrial Lease between L.L. Brown and Cook Inlet Region, Inc. dated
January 1999.
10.6 [1] Service Contract between L.L. Brown and the County of Washtenaw, dated
January 2000.
10.7 [1] Agreement between L.L. Brown and Kern County for an Independent Thinking
Skills Training for CalWorks Participants, dated May 2000.
10.8 [1] Client Service Contract between L.L. Brown and the State of Washington
Deportment of Social and Health Services, dated June 2000.
10.9 [1] Non-Circumvention/Finder's Fee Agreement between L.L. Brown and David
Penney & Associates, dated September 2000.
10.10 [2] Service Agreement between the Company and CWA District 7 dated December 5,
2000.
10.11 [2] Service Agreement between the Company and Arizona, AFLCIO dated January 29,
2001.
10.12 [1] Promissory Note between L.L. Brown and KeyBank National Association in the
amount of $126,104.00 dated October 1998.
10.13 [6] L.L. Brown International, Inc. Year 2002 Employee/Consultant Stock Compensation
Plan.
10.14 [7] Agreement between the Company and the Seminole Tribe of Florida dated August
30, 2001.
10.15 [7] Agreement between the Company and Capital Research Group, Inc., dated January
17, 2002.
11.1 [3] Statement re: computation of per share earnings.
16.1 [4] Letter on change of certifying accountant pursuant to Regulation SK Section
304(a)(3).
16.2 [5] Letter on change of certifying accountant pursuant to Regulation SK Section
304(a)(3).
23.1 [6] Consent of George Stewart, CPA
23.2 [6] Consent of Mintmire & Associates (contained in the opinion filed as Exhibit 5.1
hereof).
99.1 * Sarbanes Oxley Certification by Chief Executive Officer.
99.2 * Sarbanes Oxley Certification by Chief Financial Officer (or equivalent).
- ---------------------
[1] Previously filed as an exhibit to the Company's Registration Statement on
Form 10SB on November 13, 2000.
[2] Previously filed as an exhibit to the Company's Annual Report on Form 10KSB
on March 21, 2001.
[3] Previously filed as an exhibit to the Company's First Amended Registration
Statement on Form 10SB on April 5, 2001.
[4] Previously filed as an exhibit to the Company's Current Report on Form 8K
on August 17, 2001.
[5] Previously filed as an exhibit to the Company's amended Current Report on
Form 8K on August 27, 2001.
[6] Previously filed as an exhibit to the Company's Registration Statement on
Form S-8 on January 25, 2002.
[7] Previously filed as an exhibit to the Company's Annual Report on Form 10KSB
on March 29, 2002.
* Filed Herewith.
(b) A report on Form 8-K was filed on August 17, 2001 to disclose a change
in the Registrant's Certifying Accountant. On August 27, 2001, the Registrant
filed an amended Current Report on Form 8-K to disclose additional information
regarding the change of accountants at the request of the Commission.
Item 2. Description of Exhibits
The documents required to be filed as Exhibits Number 2 and 6 and in Part
III of Form 1-A filed as part of this Registration Statement on Form 10-SB are
listed in Item 1 of this Part III above. No documents are required to be filed
as Exhibit Numbers 3 , 5 or 7 in Part III of Form 1-A and the reference to such
Exhibit Numbers is therefore omitted. The following additional exhibits are
filed hereto:
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.
L.L. Brown International, Inc.
----------------------------------------
(Registrant)
Date: August 8, 2002 By: /s/ Carolyn Scott Brown
-----------------------------------
Carolyn Scott Brown, President
By: /s/ Lester L. Brown
------------------------------------
Lester L. Brown, Vice-President