FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For Quarter Ended: MARCH 31, 2003
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF
1934
For the transition period from ______________ to ______________
Commission File Number: 0-14786
AUTOINFO, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 13-2867481
(State or other jurisdiction of (I.R.S. Employer Identification number)
incorporation or organization)
6401 Congress Ave., Suite 230, Boca Raton, FL 33487
(Address of principal executive office)
(561) 988-9456
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 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 |_|
Number of shares outstanding of the Registrant's common stock as of April 28,
2003:
27,347,923 shares of common stock, $.001 par value.
Indicate by check mark whether the Registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
YES |X| NO |_|
AUTOINFO, INC. AND SUBSIDIARIES
INDEX
Part I. Financial Information:
Item 1. Consolidated Financial Statements: Page
Balance Sheets
March 31, 2003 (unaudited) and December 31, 2002 (audited)..... 3
Statements of Income (unaudited)
Three months ended March 31, 2003 and 2002..................... 4
Statements of Cash Flows (unaudited)
Three months ended March 31, 2003 and 2002..................... 5
Notes to Unaudited Consolidated Financial Statements........... 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations............................ 9
Item 3. Controls and Procedures........................................ 12
Part II. Other Information.................................................. 12
Signatures.................................................................. 13
Certifications.............................................................. 14
2
AUTOINFO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, December 31,
2003 2002
------------ ------------
Unaudited Audited
ASSETS
Current assets:
Cash and cash equivalents $ 771,000 $ 684,000
Accounts receivable 2,928,000 2,996,000
Other current assets 256,000 197,000
------------ ------------
Total current assets 3,955,000 3,877,000
Fixed assets, net of accumulated depreciation 68,000 67,000
------------ ------------
$ 4,023,000 $ 3,944,000
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Loan payable $ 500,000 $ 500,000
Convertible subordinated debentures 575,000 575,000
Accounts payable and accrued liabilities 2,281,000 2,281,000
------------ ------------
Total current liabilities 3,356,000 3,356,000
------------ ------------
Stockholders' Equity
Common stock - authorized 100,000,000 shares
$.001 par value; issued and outstanding -
27,348,000 shares as of March 31, 2003 and
December 31, 2002 27,000 27,000
Additional paid-in capital 18,019,000 18,019,000
Deficit (17,379,000) (17,458,000)
------------ ------------
Total stockholders' equity 667,000 588,000
------------ ------------
$ 4,023,000 $ 3,944,000
============ ============
The accompanying notes are an integral part of these
consolidated financial statements.
3
AUTOINFO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
March 31,
2003 2002
------------ ------------
Gross revenues $ 5,141,000 $ 3,560,000
Cost of transportation 4,142,000 2,878,000
------------ ------------
Net revenues 999,000 682,000
------------ ------------
Commissions 577,000 348,000
Operating expenses 303,000 235,000
------------ ------------
880,000 583,000
------------ ------------
Income from operations 119,000 99,000
------------ ------------
Other charges (credits):
Investment income (3,000) (7,000)
Interest expense 38,000 38,000
------------ ------------
35,000 31,000
------------ ------------
Income before income taxes 84,000 68,000
Income taxes (Note 2) 5,000 3,000
------------ ------------
Net income $ 79,000 $ 65,000
============ ============
Basic and diluted net income per share $ .00 $ .00
============ ============
Weighted average number of common and
common equivalent shares 28,347,000 27,694,000
------------ ------------
The accompanying notes are an integral part of these
consolidated financial statements.
4
AUTOINFO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
2003 2002
--------- ---------
Cash flows from operating activities:
Net income $ 79,000 $ 65,000
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 9,000 3,000
Changes in assets and liabilities:
Accounts receivable 68,000 (803,000)
Other current assets (59,000) (11,000)
Accounts payable and accrued liabilities -- 573,000
--------- ---------
Net cash provided by (used in) operating activities 97,000 (173,000)
--------- ---------
Cash flows from investing activities:
Capital expenditures (10,000) (7,000)
Proceeds from sale of short-term investments -- 15,000
--------- ---------
Net cash provided by (used in) investing activities (10,000) 8,000
--------- ---------
Net change in cash and cash equivalents 87,000 (165,000)
Cash and cash equivalents at beginning of period 684,000 885,000
--------- ---------
Cash and cash equivalents at end of period $ 771,000 $ 720,000
========= =========
The accompanying notes are an integral part of these
consolidated financial statements.
5
AUTOINFO, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
Forward Looking Statements
Certain statements made in this Quarterly Report on Form 10-QSB are
"forward-looking statements"(within the meaning of the Private Securities
Litigation Reform Act of 1995) regarding the plans and objectives of management
for future operations. Such statements involve known and unknown risks,
uncertainties and other factors that may cause our actual results, performance
or achievements of the Company to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. The forward-looking statements included herein are
based on current expectations that involve numerous risks and uncertainties. Our
plans and objectives are based, in part, on assumptions involving judgments with
respect to, among other things, future economic, competitive and market
conditions and future business decisions, all of which are difficult or
impossible to predict accurately and many of which are beyond our control.
Although we believe that our assumptions underlying the forward-looking
statements are reasonable, any of the assumptions could prove inaccurate and,
therefore, there can be no assurance that the forward-looking statements
included in this report will prove to be accurate. In light of the significant
uncertainties inherent in the forward-looking statements included herein
particularly in view of the current state of our operations, the inclusion of
such information should not be regarded as a statement by us or any other person
that our objectives and plans will be achieved. Factors that could cause actual
results to differ materially from those expressed or implied by forward-looking
statements include, but are not limited to, the factors set forth under the
headings "Business," and "Risk Factors" in our Annual Report on Form 10-KSB for
the year ended December 31, 2002 as filed with the Securities and Exchange
Commission.
Note 1. - Business and Summary of Significant Accounting Policies
Business
As a result of our acquisition of Sunteck Transport Co., Inc. ("Sunteck")
in December 2000, we are a full service third party transportation logistics
provider. Our services include ground transportation coast to coast, local pick
up and delivery, warehousing, air freight and ocean freight. We have strategic
alliances with less than truckload (LTL), truckload, air, rail and ocean common
carriers to service our customers' needs.
We have five regional operating centers and representatives in 12 states
and Canada. As of April 18, 2003, we had 42 sales agents. Our services include
arranging for the transport of customers' freight from a shipper's location to
the designated destination. We do not own any trucking equipment and rely on
independent carriers for the movement of customers' freight. We seek to
establish long-term relationships with our customers and provide a variety of
logistics services and solutions to eliminate inefficiencies in our customers'
supply chain management.
Summary of Significant Accounting Policies
Basis of Presentation
The financial statements of the Company have been prepared using the
accrual basis of accounting under accounting principles generally accepted in
the United States of America (GAAP).
The consolidated financial statements, which are unaudited, have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission ("SEC"). In management's opinion, these financial statements include
all adjustments (consisting only of normal recurring adjustments) necessary for
a fair presentation of the results of
6
operations for the interim periods presented. The results of operations for the
three months ended March 31, 2003 and 2002 are not necessarily indicative of
results to be expected for the entire year. Pursuant to SEC rules and
regulations, certain information and footnote disclosures normally included in
financial statements prepared in accordance with GAAP have been omitted from
these statements. The consolidated financial statements and notes thereto should
be read in conjunction with the financial statements and notes included in our
Annual Report on Form 10-KSB.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiary Sunteck Transport Co., Inc. All significant
intercompany balances and transactions have been eliminated in consolidation.
Revenue Recognition
As a third party transportation logistics provider, the Company acts as
the shippers' agent and arranges for a carrier to handle the freight. Gross
revenues consist of the total dollar value of services purchased by shippers.
Revenue is recognized upon the delivery of freight, at which time the related
transportation cost, including commission, is also recognized. At that time, the
Company's obligations are completed and collection of receivables is reasonably
assured.
Provision For Doubtful Accounts
The Company continuously monitors the creditworthiness of its customers
and has established an allowance for amounts that may become uncollectible in
the future based on current economic trends, historical payment trends and bad
debt write-off experience, and any specific customer related collection issues.
The provision for doubtful accounts was $61,000 and $60,000 as of March 31, 2003
and December 31, 2002, respectively.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash in banks and investments in
short-term, highly liquid securities having original maturities of three months
or less. From time to time, the Company has on deposit at financial institutions
cash balances which exceed federal deposit insurance limitations. The Company
has not experienced any losses in such accounts and believes it is not exposed
to any significant credit risk on cash and cash equivalents.
Fixed Assets
Fixed assets as of December 31, 2002 and 2001, consisting primarily of
furniture, fixtures and equipment, were carried at cost, net of accumulated
depreciation. Depreciation of fixed assets was provided on the straight-line
method over the estimated useful lives of the related assets which range from
three to five years.
Income Per Share
Basic income per share is based on net income divided by the weighted
average number of common shares outstanding. Common stock equivalents
outstanding were 999,000 and 396,000 for the three months ended March 31, 2003
and 2002, respectively.
Use of Estimates
The preparation of these financial statements in conformity with GAAP
requires management to make certain estimates and assumptions. These estimates
and assumptions affect the reported amounts of assets, liabilities and
7
contingent liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the periods presented. The Company
believes that all such assumptions are reasonable and that all estimates are
adequate, however, actual results could differ from those estimates.
Income Taxes
The Company utilizes the asset and liability method for accounting for
income taxes. Under the asset and liability method, deferred tax assets and
liabilities are recognized for the future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases and future benefits to be
recognized upon the utilization of certain operating loss carryforwards.
Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in income in the
period that includes the enactment date.
Stock-Based Compensation
The Company has adopted Statement of Financial Accounting Standards No.
123, "Accounting for Stock Based Compensation" (SFAS 123). As permitted by SFAS
123, the Company has chosen to continue to apply Accounting Principles Board
Opinion No. 25, "Accounting for Stock Issued to Employees" (APB 25) and,
accordingly, no compensation cost has been recognized for stock options in the
financial statements.
New Accounting Pronouncements
In April 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB No. 13, and Technical
Corrections" (SFAS 145), which rescinds the indicated statements and amends
other existing authoritative pronouncements to make various technical
corrections, clarify meanings, or describe their applicability under changed
conditions.
In June 2002, the FASB issued SFAS 146, "Accounting for Costs Associated
with Exit or Disposal Activities," which requires that a liability for a cost
associated with an exit or disposal activity be recognized and measured at fair
value when the liability is incurred.
In October 2002, the FASB issued SFAS 147, "Acquisitions of Certain
Financial Institutions," which requires that transactions involving the
acquisition of financial institutions, except for transactions between two or
more mutual enterprises, be accounted for in accordance with SFAS 141, "Business
Combinations," and SFAS 142, "Goodwill and Other Intangible Assets."
In December 2002, the FASB issued SFAS 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure," which amends SFAS 123, "Accounting
for Stock-Based Compensation," by providing alternative methods of transition
for a voluntary change to the fair value based method of accounting for
stock-based employee compensation. SFAS 148 also amends the disclosure
requirements of SFAS 123 by requiring prominent disclosures in both annual and
interim financial statements about the method of accounting for stock-based
employee compensation and the effect of the method used on reported results.
Adoption of these statements did not have a material impact on the
Company's financial position or results of operations.
8
Management's Discussion and Analysis of
Financial Condition And Results of Operations
Cautionary statement identifying important factors that could cause our actual
results to differ from those projected in forward looking statements.
Pursuant to the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, readers of this report are advised that this
document contains both statements of historical facts and forward looking
statements. Forward looking statements are subject to certain risks and
uncertainties, which could cause actual results to differ materially from those
indicated by the forward looking statements. Examples of forward looking
statements include, but are not limited to (i) projections of revenues, income
or loss, earnings per share, capital expenditures, dividends, capital structure
and other financial items, (ii) statements of our plans and objectives with
respect to business transactions and enhancement of shareholder value, (iii)
statements of future economic performance, and (iv) statements of assumptions
underlying other statements and statements about our business prospects.
The following Management's Discussion and Analysis of Financial Condition
and Results of Operations should be read in conjunction with our consolidated
financial statements and the notes thereto appearing elsewhere in this report.
General
As a result of our acquisition of Sunteck Transport Co., Inc. ("Sunteck")
in December 2000, we are a full service third party transportation logistics
provider. Our services include ground transportation coast to coast, local pick
up and delivery, warehousing, air freight and ocean freight. We have strategic
alliances with less than truckload (LTL), truckload, air, rail and ocean common
carriers to service our customers' needs.
We have five regional operating centers and representatives in 12 states
and Canada. As of April 18, 2003, we had 42 sales agents. Our services include
arranging for the transport of customers' freight from a shipper's location to
the designated destination. We do not own any trucking equipment and rely on
independent carriers for the movement of customers' freight. We seek to
establish long-term relationships with our customers and provide a variety of
logistics services and solutions to eliminate inefficiencies in our customers'
supply chain management.
Results of Operations
In the transportation industry, results of operations generally show a
seasonal pattern as customers reduce shipments during and after the winter
months. This industry trend has not had a significant impact on our results of
operations or our cash flows in recent years. Also, inflation has not materially
affected our operations due to the short-term transactional basis of our
business. However, we cannot fully predict the impact seasonality and inflation
may have in the future.
Three Months Ended March 31, 2003 and 2002
During the quarter ended March 31, 2003, we continued to implement our
strategic growth business plan consisting primarily of the expansion of client
services, the opening of regional operations centers in key geographical markets
and the addition of independent sales agents. As a result of this, our number of
sales agents has increased to 42 at March 31, 2003 as compared with 35 at March
31, 2002. Our net revenues (gross revenues less cost of transportation) are the
primary indicator of our ability to source, add value and resell service that
are provided by third parties and are considered to be the primary measurement
of growth. Therefore, the discussion of the results of operations below focuses
9
on the changes in our net revenues. The increases in net revenues and all
related cost and expense categories are the direct result of our business
expansion.
The following table represents certain statement of operation data as a
percentage of net revenues:
2003 2002
------ ------
Net revenues 100.0% 100.0%
------ ------
Commissions 57.8% 51.0%
Operating expenses 30.3% 34.5%
Other charges 3.5% 4.5%
------ ------
Income from before income taxes 8.4% 10.0%
------ ------
Revenues
Gross revenues consisting of freight fees and other related services
revenue totaled $5,141,000 for the period ended March 31, 2003, as compared with
$3,560,000 in the prior year period. Net revenues were $999,000 for the period
ended March 31, 2003, as compared with $682,000 in the prior year period.
Costs and expenses
Commissions totaled $577,000 for the period ended March 31, 2003, as
compared with $348,000 in the prior year period. As a percentage of net
revenues, commissions were 57.8% for the period ended March 31, 2003 as compared
with 51% in the prior year period. This increase is the direct result of higher
commission rates related to the addition of independent sales agents at higher
commission rates than historically experienced. We expect commission rates to be
consistent with the current period for the foreseeable future.
Operating expenses totaled $303,000 for the period ended March 31, 2003,
as compared with $235,000 in the prior year period. As a percentage of net
revenues, operating expenses were 30.3% for the period ended March 31, 2003 as
compared with 34.5% in the prior year period. This decrease is the direct result
of management's ability to leverage selling, general and administrative expenses
in connection with our business expansion.
Investment income, primarily consisting of dividend and interest income,
was $3,000 for the period ended March 31, 2003 as compared with $7,000 in the
prior year period.
Interest expense totaled $38,000 for the three month periods ended March
31, 2003 and 2002.
Income taxes
Income taxes were $5,000 for the period ended March 31, 2003 as compared
with $3,000 in the prior year period.
Net income (loss)
Net income totaled $79,000 for the period ended March 31, 2003, as
compared with a loss of $65,000 in the prior year period.
10
Trends and uncertainties
The transportation industry is highly competitive and highly fragmented.
Our primary competitors are other non-asset based as well as asset based third
party logistics companies, freight brokers, carriers offering logistics services
and freight forwarders. We also compete with customers' and shippers internal
traffic and transportation departments as well as carriers internal sales and
marketing departments directly seeking shippers' freight. We anticipate that
competition for our services will continue to increase. Many of our competitors
have substantially greater capital resources, sales and marketing resources and
experience. We cannot assure you that we will be able to effectively compete
with our competitors in effecting our business expansion plans.
For the year ended December 31, 2002, we increased gross revenues from
$8.0 million to $18.9 million and had net income of $340,000 as compared with a
net loss of $15,000 in the prior year. For the three months ended March 31, 2003
revenues were $5,141,000 and net income was $79,000 as compared with revenues of
$3,560,000 and net income of $65,000 in the prior year. However, as of March 31,
2003, we had an accumulated deficit of $17.4 million. Factors that could
adversely affect our operating results include:
o the success of Sunteck in expanding its business operations; and
o changes in general economic conditions.
Depending on our ability to generate revenues, we may require additional
funds to expand Sunteck's business operations and for working capital and
general corporate purposes. Any additional equity financing may be dilutive to
stockholders, and debt financings, if available, may involve restrictive
covenants that further limit our ability to make decisions that we believe will
be in our best interests. In the event we cannot obtain additional financing on
terms acceptable to us when required, our ability to expand Sunteck's operations
may be materially adversely affected.
Liquidity and capital resources
At March 31, 2003, we had outstanding $575,000 of subordinated convertible
debentures and $500,000 pursuant to a line of credit. The debentures are
convertible into common stock at the option of the debenture holder at a
conversion price of $0.25 per share and are redeemable, at the option of the
holder, on or after December 31, 2003. The line of credit, obtained from a
related party in August 2001, is secured by accounts receivable and matures in
August 2003. We believe that we have sufficient working capital to meet our
short-term operating needs and that we will be able to extend or replace the
line of credit on terms acceptable to us.
At March 31, 2003, we had liquid assets of approximately $771,000.
The total amount of debt outstanding as of March 31, 2003 was $1,075,000.
This following table presents our debt instruments and their weighted average
interest rates as of March 31, 2003:
Weighted
Balance Average Rate
------------- --------------
Subordinated Debt $ 575,000 12.0%
Line of Credit $ 500,000 17.0%
Inflation and changing prices had no material impact on revenues or the
results of operations for the period ended March 31, 2003.
11
Controls and Procedures
(a) Evaluation of Disclosure Controls and Procedures
Within the past 90 days, AutoInfo's management, including its Chief Executive
Officer and Chief Financial Officer, have conducted an evaluation of the
effectiveness of disclosure controls and procedures pursuant to Rule 13a-14 and
15d-14 under the Securities Exchange Act of 1934, as amended. Based on that
evaluation, the Chief Executive Officer and Chief Financial Officer concluded
that the disclosure controls and procedures are effective in ensuring that all
material information required to be filed in this quarterly report has been made
known to them in a timely fashion.
(b) Changes in Internal Controls
There have been no significant changes in internal controls, or in factors that
could significantly affect internal controls, subsequent to the date the Chief
Executive Officer and Chief Financial Officer completed their evaluation.
Part II
OTHER INFORMATION
Item 1 - 5: Inapplicable
Item 6: Exhibits
--------
99.1 Chief Executive Officer Certification
99.2 Chief Financial Officer Certification
12
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
authorized.
AUTOINFO, INC.
By: /s/ William Wunderlich
--------------------------------------
William Wunderlich
Executive Vice President and
Principal Financial Officer
Date: April 28, 2003
13
AUTOINFO, INC.
CERTIFICATIONS PURSUANT TO SECTION 302
OF THE SARBANES-OXLEY ACT OF 2002
CERTIFICATION
I, Harry Wachtel, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of AutoInfo, Inc.;
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.
/s/ Harry Wachtel
-------------------------------------
Harry Wachtel
President and Chief Executive Officer
Date: April 30, 2003
14
CERTIFICATION
I, William Wunderlich, certify that:
7. I have reviewed this quarterly report on Form 10-QSB of AutoInfo, Inc.;
8. 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;
9. 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;
10. 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:
(d) 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;
(e) 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
(f) 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;
11. 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
12. 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.
/s/ William Wunderlich
------------------------------------
William Wunderlich
Chief Financial Officer
Date: April 30, 2003
15