-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HMQ9uJdGIQagsVebV2PaxpIvE5y1gcRbZtASGSWv9WQwGpTT0n08DQWgJZoXBEQv KblaUQodmLOFs4o0LR8+NA== 0001169232-02-002957.txt : 20080626 0001169232-02-002957.hdr.sgml : 20080626 20021114173014 ACCESSION NUMBER: 0001169232-02-002957 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20020930 FILED AS OF DATE: 20021114 DATE AS OF CHANGE: 20080620 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERITRANS CAPITAL CORP CENTRAL INDEX KEY: 0001064015 IRS NUMBER: 522102424 STATE OF INCORPORATION: DE FISCAL YEAR END: 0607 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 814-00193 FILM NUMBER: 02826502 BUSINESS ADDRESS: STREET 1: 747 THIRD AVENUE STREET 2: 4TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2123552449 MAIL ADDRESS: STREET 1: 747 THIRD AVENUE STREET 2: 4TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10017 10-Q 1 d52596_10-q.txt FORM 10-Q FORM 10-Q |X| Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended September 30, 2002 or |_| Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from ____________ to Commission File Number 0-22153 AMERITRANS CAPITAL CORPORATION (Exact name of registrant as specified in its charter) Delaware 52-2102424 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 747 Third Avenue Fourth Floor New York, New York 10017 (Address of Registrant's (Zip Code) principal executive office) Registrant's telephone number, including area code: (800) 214-1047 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 |_| The number of shares of Common Stock, par value $.0001 per share, outstanding as of November 13, 2002: 2,035,600 AMERITRANS CAPITAL CORPORATION FORM 10-Q Table of Contents PART I. FINANCIAL INFORMATION Item 1. Consolidated Financial Statements Consolidated Balance Sheets as of September 30, 2002 (unaudited) and June 30, 2002 ................................. 1 Consolidated Statements of Operations -- For the Three Months Ended September 30, 2002 and 2001 (unaudited) ................. 3 Consolidated Statements of Cash Flows -- For the Three Months Ended September 30, 2002 and 2001 (unaudited) .......... 4 Notes to Consolidated Financial Statements ...................... 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations ............................. 10 Item 3. Quantitative and Qualitative Disclosure about Market Risk ........ 11 Item 4. Controls and Procedures .......................................... 12 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K ................................. 13 Signatures ....................................................... 14 -ii- AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS September 30, 2002 (Unaudited) and June 30, 2002 ASSETS September 30, 2002 June 30, 2002 ------------------ ------------- Loans receivable $ 56,219,129 $ 55,029,831 Less: unrealized depreciation on loans receivable (238,500) (238,500) ------------ ------------ 55,980,629 54,791,331 Cash and cash equivalents 701,789 774,062 Accrued interest receivable, net of unrealized depreciation of $161,300 and $206,272 respectively 1,443,155 1,197,075 Assets acquired in satisfaction of loans 1,103,588 1,108,088 Receivables from debtors on sales of assets acquired in satisfaction of loans 367,271 367,271 Equity securities 616,327 443,327 Furniture, fixtures and leasehold improvements, net 111,104 107,757 Prepaid expenses and other assets 294,877 219,305 ------------ ------------ TOTAL ASSETS $ 60,618,740 $ 59,008,216 ============ ============ The accompanying notes are an integral part of these financial statements. -1- AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS September 30, 2002 (Unaudited) and June 30, 2002 LIABILITIES AND STOCKHOLDERS' EQUITY September 30, 2002 June 30, 2002 ------------------ ------------- LIABILITIES Debentures payable to SBA $ 7,220,000 $ 7,860,000 Notes payable, banks 35,590,000 33,720,000 Accrued expenses and other liabilities 697,582 434,339 Accrued interest payable 137,340 258,358 Dividends payable 432,127 68,438 ------------ ------------ TOTAL LIABILITIES 44,077,049 42,341,135 ------------ ------------ COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY Preferred stock 500,000 and 1,000,000 shares authorized respectively, none outstanding -- -- 9 3/8% Cumulative participating preferred stock $.01 par value, $12.00 face value, 500,000 shares authorized; 300,000 shares issued and outstanding 3,600,000 3,600,000 Common stock, $.0001 par value: 5,000,000 shares authorized; 2,045,600 shares issued and 2,035,600 shares outstanding 205 205 Additional paid-in-capital 13,869,545 13,869,545 Accumulated deficit (828,517) (703,127) Accumulated other comprehensive loss (29,542) (29,542) ------------ ------------ TOTAL STOCKHOLDERS' EQUITY 16,611,691 16,737,081 ------------ ------------ Treasury stock, at cost, 10,000 shares common stock (70,000) (70,000) ------------ ------------ NET STOCKHOLDERS' EQUITY 16,541,691 16,667,081 ------------ ------------ TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 60,618,740 $ 59,008,216 ============ ============ The accompanying notes are an integral part of these financial statements. -2- AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS For the Three Months Ended September 30, 2002 and 2001 (UNAUDITED) Three Months Ended Three Months Ended September 30, 2002 September 30, 2001 ------------------ ------------------ INVESTMENT INCOME Interest on loans receivable $ 1,551,000 $1,479,631 Fees and other income 57,233 45,700 ----------- ---------- TOTAL INVESTMENT INCOME 1,608,233 1,525,331 ----------- ---------- OPERATING EXPENSES Interest 540,686 740,934 Salaries and employee benefits 219,913 155,581 Legal fees 61,927 46,088 Miscellaneous administrative expenses 371,291 200,589 Loss on assets acquired in satisfaction of loans, net 9,724 37,445 Directors' fees 13,250 3,750 Write off and depreciation of interest and loans receivable 73,228 18,322 ----------- ---------- TOTAL OPERATING EXPENSES 1,290,019 1,202,709 ----------- ---------- OPERATING INCOME 318,214 322,622 INCOME BEFORE INCOME TAXES 318,214 322,622 INCOME TAXES 11,483 1,070 ----------- ---------- NET INCOME 306,731 321,552 =========== ========== DIVIDENDS ON PREFERRED STOCK (84,375) -- =========== ========== NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $ 222,356 $ 321,552 =========== ========== WEIGHTED AVERAGE SHARES OUTSTANDING Basic 2,035,600 1,745,600 =========== ========== Diluted 2,035,600 1,745,600 =========== ========== NET INCOME PER COMMON SHARE Basic $ .1092 $ .1842 =========== ========== Diluted $ .1092 $ .1842 =========== ========== The accompanying notes are an integral part of these financial statements -3- AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS For the Three Months Ended September 30, 2002 and 2001 (UNAUDITED)
September 30, 2002 September 30, 2001 ------------------ ------------------ CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 306,731 $ 321,552 ----------- --------- Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 6,654 8,600 Changes in assets and liabilities Accrued interest receivable (246,079) (172,321) Prepaid expenses and other assets (75,572) (300,290) Accrued expenses and other liabilities 263,247 1,238 Accrued interest payable (121,018) (71,507) ----------- --------- TOTAL ADJUSTMENTS (172,768) (534,280) ----------- --------- NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 133,963 (212,728) ----------- --------- CASH FLOWS FROM INVESTING ACTIVITIES Net change in loans receivable, assets acquired in satisfaction of loans and receivables from debtors on sales of assets acquired in satisfaction of loans (1,184,798) 970,283 Purchases of equity securities (173,000) (52,525) Acquisition of furniture, fixtures and leasehold improvements (10,000) (8,378) ----------- --------- NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES (1,367,798) 909,380 ----------- --------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds (repayments) from notes payable, banks, net 1,870,000 (550,000) Repayments of notes payable, SBA, net (640,000) -- Dividends paid (68,438) -- ----------- --------- NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 1,161,562 (550,000) ----------- ---------
The accompanying notes are an integral part of these financial statements. -4- AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED), Continued For the Three Months Ended September 30, 2002 and 2001
September 30, 2002 September 30, 2001 ------------------ ------------------ NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS $ (72,273) $146,652 CASH AND CASH EQUIVALENTS - Beginning 774,062 575,229 --------- -------- CASH AND CASH EQUIVALENTS - Ending $ 701,789 $721,881 ========= ========
Supplemental noncash financing activity: During the three months ended September 30, 2002, the Company accrued a preferred stock cash dividend of $84,375 and a common stock cash dividend of $347,752, which is comprised of $0.06 per share for the quarter ended June 30, 2002 and an estimated dividend of $0.11 per share for the quarter ended September 30, 2002. The accompanying notes are an integral part of these financial statements. -5- AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES Notes to Consolidated Financial Statements NOTE 1 -- Organization and Summary of Significant Accounting Policies Financial Statements The consolidated balance sheet of Ameritrans Capital Corporation ("Ameritrans" or the "Company") as of September 30, 2002, the related statements of operations, and cash flows for the three months ended September 30, 2002 and September 30, 2001 included in Item 1 have been prepared by the Company, without audit, pursuant to the rules and regulations of the Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the accompanying consolidated financial statements include all adjustments (consisting of normal, recurring adjustments) necessary to summarize fairly the Company's financial position and results of operations. The results of operations for the three months ended September 30, 2002 are not necessarily indicative of the results of operations for the full year or any other interim period. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2002 as filed with the Commission. Organization and Principal Business Activity Ameritrans, a Delaware corporation, acquired all of the outstanding shares of Elk Associates Funding Corporation ("Elk") on December 16, 1999 in a share for share exchange. Prior to the acquisition, Elk had been operating independently and Ameritrans had no operations. The historical financial statements prior to December 16, 1999 were those of Elk. Elk, a New York corporation, is licensed by the Small Business Administration ("SBA") to operate as a small Business Investment Company ("SBIC") under the Small Business Investment Act of 1958, as amended. Elk has also registered as an investment company under the Investment Company Act of 1940 to make business loans. Ameritrans is a specialty finance company that through its subsidiary, Elk, makes loans to taxi owners to finance the acquisition and operation of the medallion taxi businesses and related assets, and to other small businesses in the New York City, Chicago, Miami, and Boston markets. From inception through April 2002, Ameritrans' only activities have been the operations of Elk. In May 2002, Ameritrans made its first loans to businesses using the proceeds raised from the public offering which was completed in April 2002. Basis of Consolidation The consolidated financial statements include the accounts of Ameritrans, Elk and EAF Holding Corporation ("EAF"), a wholly owned subsidiary of Elk, collectively referred to as the "Company". All significant inter-company transactions have been eliminated in consolidation. -6- Basis of Consolidation (cont.) EAF was formed in June 1992 and began operations in December 1993. The purpose of EAF is to own and operate certain real estate assets acquired in satisfaction of loans by Elk. Ameritrans organized another subsidiary on June 8, 1998, Elk Capital Corporation ("Elk Capital"), which may engage in similar lending and investment activities. Since inception, Elk Capital has had no operations or activities. Reclassifications Certain amounts in the prior financial statements have been reclassified for comparative purposes to conform with the presentation in the financial statements for the three months ended September 30, 2002. These reclassifications have no effect on previously reported net income. Income Taxes The Company has elected to be taxed as a Regulated Investment Company under the Internal Revenue Code. A Regulated Investment Company will generally not be taxed at the corporate level to the extent its income is distributed to its stockholders. In order to be taxed as a Regulated Investment Company, the Company must pay at least 90 percent of its net investment company taxable income to its stockholders as well as meet other requirements under the Code. In order to preserve this election for fiscal 2002, the Company intends to make the required distributions to its stockholders in accordance with applicable tax rules. Net Income per Share During the year ended June 30, 1998, the Company adopted the provision of Statements of Financial Accounting Standards No. 128 "Earnings per Share" ("SFAS No. 128"). SFAS No. 128 eliminates the presentation of primary and fully dilutive earnings per share ("EPS") and requires presentation of basic and diluted EPS. Basic EPS is computed by dividing income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS is based on the weighted-average number of shares of common stock and common stock equivalents outstanding for the period. Common stock equivalents have been excluded from the weighted-average shares for 2002 and 2001 as inclusion is anti-dilutive. At September 30, 2002 the Company had 122,224 options outstanding. Loan Valuations The Company's loans are recorded at fair value. Loans are valued at cost less unrealized depreciation. Since no ready market exists for these loans, the fair value is determined in good faith by the Board of Directors. In determining the fair value, the Company and Board of Directors consider factors such as the financial condition of the borrower, the adequacy of the collateral, individual credit risks, historical loss experience and the relationships between current and projected market rates and portfolio rates of interest and maturities. To date, the fair value of the loans has been determined to approximate cost less unrealized depreciation and no loans have been recorded above cost. -7- Use of Estimates in the Financial Statements 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 revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates that are particularly susceptible to change relate to the determination of the fair value of financial instruments. NOTE 2 -- Debentures Payable to SBA At September 30, 2002 and June 30, 2002 debentures payable to the SBA consist of subordinated debentures with interest payable semiannually, as follows: Current 9/30/02 6/30/02 Effective Principal Principal Issue Date Due Date Interest Rate Amount Amount ---------- -------- ------------- ------ ------ September 1993 September 2003 6.12(1) $1,500,000 $1,500,000 September 1993 September 2003 6.12 2,220,000 2,220,000 September 1994 September 2004 8.20(4) -- 2,690,000 June 1996 June 2006 7.71 1,020,000 1,020,000 March 1997 March 2007 7.38(2) 430,000 430,000 July 2002 September 2012 4.67(3) 2,050,000 -- ---------- ---------- $7,220,000 $7,860,000 ========== ========== (1) Interest rate was 3.12% from inception through September 1998. (2) Elk is also required to pay an additional annual user fee of 1% on this debenture. (3) Elk is also required to pay an additional annual user fee of 0.88% on this debenture. (4) The loan was prepaid in full during September 2002. Under the terms of the subordinated debentures, Elk may not repurchase or retire any of its capital stock or make any distributions to its stockholders other than dividends out of retained earnings (as computed in accordance with SBA regulations) without the prior written approval of the SBA. SBA Commitment During January 2002 Elk and the SBA entered into an agreement whereby the SBA committed to reserve debentures in the amount of $12,000,000 to be issued by Elk on or prior to September 30, 2006. A 2.5% leverage fee will be deducted pro rata as the commitment proceeds are drawn down. A $120,000 non-refundable fee was paid by Elk at the time of obtaining the $12,000,000 commitment. -8- SBA Commitment (cont.) During July 2002, a new debenture payable to SBA was drawn from the reserve pool of $12,000,000 in the amount of $2,050,000 with an interim interest rate of 2.351%. The fixed rate of 4.67% was determined on the pooling date of September 25, 2002. In addition to the fixed rate, there is an additional annual SBA user fee of 0.88% per annum that will also be charged making the rate 5.55% before applicable amortization of points and fees. NOTE 3 -- Notes Payable to Banks At September 30, 2002 and June 30, 2002 Elk had loan agreements with three (3) banks for lines of credit aggregating $40,000,000. At September 30, 2002 and June 30, 2002, Elk had $35,590,000 and $33,720,000 respectively, outstanding under these lines. The loans, which mature through November 30, 2002, bear interest based on Elk's choice of the lower of either the reserve adjusted LIBOR rate plus 150 basis points or the banks' prime rates minus 1/2% plus certain fees. Upon maturity, Elk anticipates extending the lines of credit for another year, as has been the practice in previous years. Pursuant to the terms of the agreements Elk is required to comply with certain terms, covenants and conditions. Elk pledged its loans receivable and other assets as collateral for the above lines of credit. NOTE 4 -- Commitments and Contingencies Interest Rate Swap On January 10, 2000 Elk entered into a $5,000,000 interest rate Swap transaction with a bank expiring on October 8, 2001. On June 11, 2001 Elk entered into an additional interest rate Swap transaction with the same bank for $10,000,000 expiring on June 11, 2002. On June 11, 2001 Elk entered into another interest rate Swap transaction for $15,000,000 with this bank expiring June 11, 2003. These Swap transactions were entered into to protect Elk from an upward movement in interest rates relating to outstanding bank debt (see Note 3 for terms and effective interest rates). These Swap transactions call for a fixed rate of 4.95%, 4.35% and 4.95%, respectively, (plus 150 basis points) for Elk and if the floating one month LIBOR rate is below the fixed rate then Elk is obligated to pay the bank for the difference in rates. When the one-month LIBOR rate is above the fixed rate then the bank is obligated to pay Elk for the differences in rates. The effective fixed costs on the debt that was swapped, including the 150 basis points, is 6.45%, 5.85% and 6.45% respectively. Loan Commitments At September 30, 2002 and June 30, 2002 the Company had commitments to make loans totaling approximately $2,049,446 and $1,515,297, respectively, at interest rates ranging from 9% to 17.5%. -9- NOTE 5 -- Other Matters Quarterly Dividend The Company's Board of Directors declared a dividend of $0.28125 per share or $84,375 on September 20, 2002 on the Company's 9 3/8% Participating Preferred Stock (the "Participating Preferred Stock") for the period July 1, 2002 through September 30, 2002, which was paid on October 7, 2002 to all holders of the Participating Preferred Stock of record as of September 30, 2002. On September 26, 2002 the Company's Board of Directors declared a dividend of $0.06 per share of Common Stock for the period April 1, 2002 through June 30, 2002, and a dividend based on estimated earnings for the period July 1, 2002 through September 30, 2002 of $0.11 per share of Common Stock or an aggregate of $0.17 per share. The dividend was paid on October 16, 2002 to stockholders of record as of October 7, 2002. Note 6 - Subsequent Event During October 2002 Elk submitted an application to the SBA for an additional $3,000,000 draw down from the $12,000,000 SBA commitment (see Note 2.) This application is pending approval from the SBA. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information contained in this section should be used in conjunction with the consolidated Financial Statements and Notes therewith appearing in this report Form 10-Q and the Company's Annual Report on Form 10-K for the year ended June 30, 2002. General Ameritrans acquired Elk on December 16, 1999 in a share for share exchange. Elk is licensed by the Small Business Administration (SBA) to operate as a Small Business Investment Company (SBIC) under the Small Business Investment Act of 1958, as amended. Both Ameritrans and Elk are registered as an investment company under the Investment Company Act of 1940. Elk primarily makes loans and investments to persons who qualify under SBA regulation as socially or economically disadvantaged and loans and investments to entities which are at least 50% owned by such persons. Elk also makes loans and investments to persons who qualify under SBA regulation as "non-disadvanged". Elks's primary lending activity is to originate and service loans collateralized by New York City, Boston, Chicago and Miami taxicab medallions. Elk also makes loans and investments in other diversified businesses. At September 30, 2002, 76.04% of Elk's portfolio was invested in loans secured by taxi medallions and 23.96% of Elk's loans were to other diversified businesses. From inception through April 2002, Ameritrans' only activities have been the operations of Elk. In May 2002, Ameritrans made its first loans to businesses using the proceeds raised from the public offering which was completed in April 2002. -10- Results of Operations For the Three Months Ended September 30, 2002 and 2001. Total Investment Income The Company's investment income for the three months ended September 30, 2002 increased $82,902 or 5.4% as compared with the three month period in the prior fiscal year. This increase was mainly due to the Backup Services Fee the Company received ($22,500) as a result of executing an agreement with Medallion Financial Corp and Merrill Lynch to be a standby backup loan servicing agent, combined with income earned by Ameritrans ($31,000) on investments made from the proceeds of the Company's public offering. As a back-up servicer, the Company will earn an annual standby fee. If the agreement is activated by Merrill Lynch, the Company will become the primary servicer, which will create an additional revenue source. The Company's Loan Portfolio increased from $53,785,894 as of September 30, 2001 to $56,219,129 at September 30, 2002. Operating Expenses Operating Expenses increased $60,125 for the three months ended September 30, 2002 when compared with the similar period ended September 30, 2001. This increase was due to increase payroll costs of $64,332 and other administrative expenses of $170,702 incurred during the current year reflecting the Company's increased activity due to its public offering in April, 2002, offset by a decrease in interest costs ($200,248) which reflects lower interest charged on the Company's bank debt combined with the refinancing of its SBA Debentures. Write offs and losses on assets acquired for the quarter increased $27,185 when compared with the quarter ended September 30, 2001 as the Company continues to correct the increase on the Chicago Loan Portfolio delinquency and defaults. This increase was attributable to the economic slowdown in the past year, and the effects on the Chicago taxi industry subsequent to the events of September 11, 2001. Balance Sheet and Reserves Total assets increased by $1,610,524 as of September 30, 2002 when compared to total assets as of June 30, 2002. This increase was due to the Elk's successful sale to the SBA of a debenture in the amount of $2,050,000. During January 2002 Elk and the SBA entered into an agreement where the SBA committed to reserve debentures in the amount of $12,000,000 to be issued by Elk prior to September 30, 2006. In July 2002 a new debenture payable to the SBA for $2,050,000 was drawn from the reserve pool of $12,000,000. In September 2002 Elk paid off a SBA debenture in the amount of $2,690,000 in order to reduce costs. In addition Elk drew down an additional $1,870,000 on its bank borrowings in order to finance expansion. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK Pursuant to the general instructions to Rule 305 of Regulation S-K, the qualitative and quantitative disclosures called for by this Item 3 and by Rule 305 of Regulation S-K are inapplicable to the Company at this time. -11- ITEM 4. CONTROLS AND PROCEDURES (a) Evaluation of Disclosure Controls and Procedures Based on their evaluation of our disclosure controls and procedures conducted within 90 days of the date of filing this report on Form 10-Q, our Chief Executive Officer and the Chief Financial Officer has concluded that our disclosure controls and procedures (as defined in Rules 13a - 14(c) and 15d - 14(c) promulgated under the Securities Exchange Act of 1934) are effective. (b) Changes in Internal Controls There were no significant changes in our internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation. -12- PART II. OTHER INFORMATION ITEM 6 -- Exhibits and Reports on Form 8-K (a) Exhibits 99.1 Certification of the Chief Executive and Chief Financial Officer of the Company pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (b) Reports on Form 8-K There were no reports filed on Form 8-K for the period ending September 30, 2002. -13- AMERITRANS CAPITAL CORPORATION SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. AMERITRANS CAPITAL CORPORATION Date: November 14, 2002 By: /s/ Gary C. Granoff -------------------------------- Gary C. Granoff Chief Financial Officer (Principal Financial Officer and Chief Accounting Officer) -14- CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Gary C. Granoff, President, Chief Executive Officer, and Chief Financial Officer of Ameritrans Capital Corporation certify that: 1. I have reviewed this quarterly report on Form 10-Q for the Ameritrans Capital 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 operation, 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 the 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 -15- 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. 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/ Gary C. Granoff - ------------------- Gary C. Granoff President, Chief Executive Officer, and Chief Financial Officer November 14, 2002 -16- EX-99.1 3 d52596_ex99-1.txt CERTIFICATION OC THE CEO AND CFO Exhibit 99.1 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Ameritrans Capital Corporation (the "Company") on Form 10-Q for the quarter ended September 30, 2002, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Gary C. Granoff, President, Chief Executive Officer, and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes- Oxley Act of 2002, that: 1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ Gary C. Granoff - ------------------- Gary C. Granoff President, Chief Executive Officer, and Chief Financial Officer November 14, 2002 -17- -----END PRIVACY-ENHANCED MESSAGE-----