10QSB 1 omiq.txt 10QSB FOR MARCH 31, 2003 United States Securities and Exchange Commission Washington, DC 20549 FORM 10-QSB Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarter Ended Commission File Number March 31, 2003 333-51180 OFFICE MANAGERS, INC. ----------------------------------------------------- (Exact name of registrant as specified in its charter) NEVADA --------------------------------------------------------------- (State or other jurisdiction of incorporation or organization) 87-0661638 ----------------------------------- (I.R.S. Employer Identification No.) 136 East South Temple, Suite 1600, Salt Lake City, Utah 84111 ------------------------------------------------------------- (Address of principal executive offices) (801) 363-2599 --------------------------------------------------- (Registrant's telephone number, including area code) Securities registered pursuant to Section 12 (b) of the Act: None ---- 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. X Yes No ----- ----- State the number of shares outstanding of each of the registrants classes of common equity, as of the latest practicable date. Common stock, par value $.001; 38,884,350 shares outstanding as of May 13, 2003 PART I - FINANCIAL INFORMATION Item 1. Financial Statements OFFICE MANAGERS, INC. ( Development Stage Company) BALANCE SHEETS March 31, 2003 and December 31, 2002
===================================================================================== Mar. 31, Dec. 31, 2003 2002 ----------- ----------- ASSETS CURRENT ASSETS Cash $ 44,228 $ 90,601 ----------- ----------- Total Current Assets 44,228 90,601 ----------- ----------- OTHER ASSETS Office equipment - net of accumulated depreciation 13,103 13,498 Web site - net of accumulated amortization 4,776 5,027 ----------- ----------- $ 62,107 $ 109,126 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 30,000 $ 1,305 Accounts payable - affiliate 50,923 50,923 ----------- ----------- Total Current Liabilities 80,923 52,228 ----------- ----------- STOCKHOLDERS' EQUITY (deficit) Common stock 50,000,000 shares authorized, at $0.001 par value; 38,827,911 shares issued and outstanding March 31; 34,598,500 shares outstanding December 31 38,828 34,599 Capital in excess of par value 470,045 470,045 Deficit accumulated during the development stage (527,689) (447,746) ----------- ----------- Total Stockholders' Equity (deficit) (18,816) 56,898 ----------- ----------- $ 62,107 $ 109,126 =========== ===========
The accompanying notes are an integral part of these financial statements. 2 OFFICE MANAGERS, INC. ( Development Stage Company) STATEMENT OF OPERATIONS For the Three Months Ended March 31, 2003 and 2002 and the Period September 19, 2000 (Date of Inception) to March 31, 2003
===================================================================================== Sept 19, 2000 Mar 31, Mar 31, to 2003 2002 Mar 31, 2003 ------------ ------------ ------------- REVENUES $ - $ - $ - ------------ ------------ ------------- EXPENSES Market development 50,530 - 211,626 Depreciation and amortization 646 - 2,232 Administrative 28,767 11,378 288,831 Development of web site - preliminary project stage - - 25,000 ------------ ------------ ------------- NET LOSS $ (79,943) $ (11,378) $ (527,689) ============ ============ ============= NET LOSS PER COMMON SHARE Basic $ - $ - AVERAGE OUTSTANDING SHARES Basic (stated in 1000's) 36,598 29,500 ------------ ------------
The accompanying notes are an integral part of these financial statements 3 OFFICE MANAGERS, INC. ( Development Stage Company) STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY For the Period September 19, 2000 (Date of Inception) to March 31, 2003
Capital in Common Stock Excess of Accumulated Shares Amount Par Value Deficit ---------- ----------- ----------- ----------- Balance September 19, 2000 - $ - $ - $ - Issuance of common stock for cash at $.001 - September 19, 2000 16,000,000 16,000 - - Issuance of common stock for web site - September 25, 2000 - Note 3 6,000,000 6,000 19,000 - Issuance of common stock for cash at $.01 - October 10, 2000 5,000,000 5,000 44,810 - Net operating loss for the period September 19, 2000 to December 31, 2000 - - - (47,010) Issuance of common stock for cash at $.0012 - January 2001 2,500,000 2,500 500 - Net operating loss for the year ended December 31, 2001 - - - (11,639) Issuance of common stock for cash at $.10 - net of offering costs - July 22, 2002 5,098,500 5,099 405,735 - Net operating loss for year ended December 31, 2002 - - - (389,097) ---------- ----------- ----------- ----------- Balance December 31, 2002 34,598,500 34,599 470,045 (447,746) Issuance of common stock for services at $.001 - January through March 2003 4,229,411 4,229 - - Net operating loss for three months ended March 31, 2003 - - - (79,943) ---------- ----------- ----------- ----------- Balance March 31, 2003 38,827,911 $ 38,828 $ 470,045 $ (527,689) ========== =========== =========== ===========
The accompanying notes are an integral part of these financial statements. 4 OFFICE MANAGERS, INC. ( Development Stage Company) STATEMENT OF CASH FLOWS For the Three Months Ended March 31, 2003 and 2002 and the Period September 19, 2000 (Date of Inception) to March 31, 2003
===================================================================================== Sept 19, 2000 Mar 31, Mar 31, to 2003 2002 Mar 31, 2003 ------------ ------------ ------------- CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ (79,943) $ (11,378) $ (527,689) Adjustments to reconcile net loss to net cash provided by operating activities Depreciation and amortization 646 - 2,232 Change in accounts payable 28,695 - 80,923 Issuance of capital stock for web site - - 25,000 Issuance of capital stock for services 4,229 - 4,229 ------------ ------------ ------------- Net Decrease in Cash From Operations (46,373) (11,378) (415,305) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of web site - - (5,027) Purchase of equipment - - (15,084) ------------ ------------ ------------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of common stock - 441,800 479,644 Net Increase (Decrease) in Cash 46,373) 430,422 44,228 ------------ ------------ ------------- Cash at Beginning of Period 90,601 35,161 - ------------ ------------ ------------- Cash at End of Period $ 44,228 $ 465,583 $ 44,228 ============ ============ ============= NON CASH FLOWS FROM OPERATING ACTIVITIES Issuance of 6,000,000 common shares for web site - 2000 $ 25,000 Issuance of 4,229,411 common shares for services - 2003 4,229 ------------
The accompanying notes are an integral part of these financial statements. 5 OFFICE MANAGERS, INC. ( Development Stage Company) NOTES TO FINANCIAL STATEMENTS March 31, 2003 =========================================================================== 1. ORGANIZATION The Company was incorporated under the laws of the State of Nevada on September 19, 2000 with authorized common stock of 50,000,000 shares at $0.001 par value. The Company primarily acts as a consultant to businesses helping them match their needs to the goods and services of reputable providers. The Company is considered a development stage company because it has not yet generated revenue from sale of its products. Since its inception, the Company has devoted substantially all of its efforts to developing its service and product offerings and to the search for sources of capital to fund its efforts. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Methods ------------------ The Company recognizes income and expenses based on the accrual method of accounting. Dividend Policy --------------- The Company has not adopted a policy regarding payment of dividends. Income Taxes ------------ On March 31, 2003, the Company had a net operating loss carry forward of $527,689. The tax benefit of approximately $158,306 from the loss carry forward has been fully offset by a valuation reserve because the use of the future tax benefit is doubtful since the Company has no operations. The net operating loss will expire starting 2021 through 2024. Basic and Dilutive Net Income (Loss) Per Share ---------------------------------------------- Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually outstanding. Diluted EPS are similarly calculated, except that the weighted average number of common shares outstanding includes common shares that may be issued, subject to existing rights, with dilutive potential. Dilutive (loss) per share has not been computed nor presented if it would be anti-dilutive and for purposes of this report the dilutive shares includes 10,197,000 shares that may be issued as outlined in note 5. Amortization of Web Site ------------------------ Costs of the preliminary development of the web site are expensed as incurred and costs of the application and post- implementation are capitalized and amortized over the useful life of the fully developed web site. 6 OFFICE MANAGERS, INC. ( Development Stage Company) NOTES TO FINANCIAL STATEMENTS (Continued) March 31, 2003 =========================================================================== 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued Financial Instruments --------------------- The carrying amounts of financial instruments, including cash and accounts payable, are considered by management to be their estimated fair values. Recent Accounting Pronouncements -------------------------------- The Company does not expect that the adoption of other recent accounting pronouncements will have a material impact on its financial statements. Financial and Concentrations Risk --------------------------------- The Company does not have any concentration or related financial credit risk. Revenue Recognition ------------------- Revenue is recognized on the sale and delivery of a product or the completion of a service provided. Statement of Cash Flows ----------------------- For the purposes of the statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents. Advertising and Market Development ---------------------------------- The Company expenses advertising and market development costs as incurred. Estimates and Assumptions ------------------------- Management uses estimates and assumptions in preparing financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were assumed in preparing these financial statements. 7 OFFICE MANAGERS, INC. ( Development Stage Company) NOTES TO FINANCIAL STATEMENTS (Continued) March 31, 2003 =========================================================================== 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued ---------------------------------------------------------- Office equipment ---------------- Office equipment is depreciated over 3 and 7 years using the straight line method. Cost $ 15,084 Less accumulated depreciation (1,981) ------------ Net 13,103 ============ 3. ACQUISITION OF WEB SITE On September 25, 2000 the Company acquired the web site and the domain name "officemanagers.net", (which was in the preliminary development stage) from Ambra Resources, Inc.(an affiliate), by the issuance of 6,000,000 common shares of the Company, for the purpose of pursuing its business interest as outlined in note 1. The value of the web site was recorded at $25,000, the acquisition cost to Ambra Resources, Inc., before the sale to the Company. Costs of the preliminary development of the web site are expensed as incurred and costs of the application and post- implementation are capitalized and amortized over an estimated useful life of five years. 4. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES Officers-directors, employees and Ambra Resources, Inc. (an affiliate by common officers) have acquired 30 % of the common stock issued. Ambra Resources, Inc. has made a no interest demand loan to the Company of $50,923 5. CAPITAL STOCK From September 2000 to January 2001 the Company completed private placement offerings of 23,500,000 common shares for $68,810. During July 2002 the Company completed the sale of an offering of 5,098,500 units at $.10 per unit. Each unit consists of one share of common stock, one redeemable A warrant to purchase an additional common share at $.50 by July 10, 2003, and one redeemable B warrant to purchase an additional common share at $1.20 by July 10, 2007 which could amount to the issuance of 10,197,000 additional shares. On the report date no warrants had been redeemed. During January and February 2003 the Company issued 4,229,411 restricted common shares for services. 8 OFFICE MANAGERS, INC. ( Development Stage Company) NOTES TO FINANCIAL STATEMENTS (Continued) March 31, 2003 =========================================================================== 6. CONTINUTING LIABILITIES The Company is obligated under a month to month office lease for $3,819 per month. 7. GOING CONCERN The Company intends to continue the development of its business interests, however, there is insufficient working capital necessary to be successful in this effort and to service its debt. Continuation of the Company as a going concern is dependent upon obtaining additional working capital and the management of the Company has developed a strategy, which it believes will accomplish this objective, through short term related party loans, long term financing, and additional equity funding, which will enable the Company to operate for the coming year. Item 2. Plan of Operations This Form 10-QSB contains certain forward-looking statements. For this purpose any statements contained in this Form 10-QSB that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as "may," "will," "expect," "believe," "anticipate," "estimate" or "continue" or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties. Actual results may differ materially depending on a variety of factors. For a complete understanding, this Plan of Operations should be read in conjunction with Part I- Item 1. Financial Statements to this Form 10- QSB. General ------- Office Managers, Inc., is a Nevada corporation acting primarily as a consultant to businesses helping them match their needs to the goods and services of reputable providers. The Company is considered a development stage company because it has not yet generated revenue from sale of its products. Since its inception, the Company has devoted substantially all of its efforts to developing its service and product offerings and to the search for sources of capital to fund its efforts. Source of Funds --------------- As discussed above, on July 10, 2002, the Company closed its initial public offering pursuant to an effective registration statement with the SEC. The Company received total proceeds of $509,850 from the offering. Since that time, the Company has relied on the proceeds of that offering to fund its operations. As of March 31, 2003, the Company has spent approximately $465,622 of the funds raised in the offering. At the present time, the Company anticipates the funds remaining from the offering should be sufficient to meet operating expenses of the Company through the first and possibly second quarters of 2003. 9 Once the proceeds from the public offering are fully used, the Company will need to seek additional funding. This funding may be sought by means of private equity or debt financing by the Company. The Company currently has no commitments from any party to provide funding and there is no way to predict when, or if, any such funding could materialize. There is no assurance that the Company will be successful in obtaining additional funding on attractive terms or at all. If the Company is unsuccessful in obtaining additional funding by the end of the second quarter of 2003, the Company may be unable to continue operations as it has insufficient working capital necessary to meet its expenses and service its debt. Results of Operations --------------------- During the period from inception, September 19, 2000, to March 31, 2003, the Company has not generated any revenue. The Company does not expect to generate any material revenues from its credit and collections referral service or online office product sales until at least the fourth quarter of 2003, if at all. At this time, the Company does not know if or when it may generate revenues from anaerobic digester systems. The Company will use substantially all of its resources for further development of its website, referral database and an anaerobic digester system. As of March 31, 2003, the Company had an accumulated deficit of ($527,689) funded by paid-in capital. At March 31, 2003, the Company owed $30,000 on accounts payable compared to $1,305 on March 31, 2002. During the quarter ended March 31, 2003, the Company spent $50,530 in market development expenses compared to $-0- in the same period 2002. During the quarter ended March 31, 2003, the Company spent $28,767 in administrative expenses compared to $11,378 for the same period of 2002. During the quarter ended March 31, 2003, the Company had losses from operations of ($79,943) compared to losses in the same period of 2002 of ($11,378). These increases are due to the Company undertaking operations and efforts to develop its website and referral database and to the investigation and development of digester systems. The Company has financed its operations mainly through the sale of its common stock and has been entirely dependent on outside sources of financing for continuation of operations. The Company expects to continue its development efforts at the same pace until funds raised in the public offering are exhausted. The Company anticipates the funds from the offering may be sufficient to fund operations for the next three to six months. The Company will then evaluate its situation to determine the potential availability of funds and to seek additional funding. At that time, the Company will also determine whether it needs to scale back its efforts to minimize expenses. As stated previously, there is no assurance that the Company will be successful in obtaining additional funding on acceptable terms or at all. The Company currently is currently paying monthly fees to its President, John Hickey and five other consultants for services being rendered to the Company. The total fees paid to these individuals on a monthly basis is approximately $17,000. The Company does not anticipate hiring employees in 2003 unless the Company is successful in securing additional funding. Once the Company has exhausted the funds raised in the offering, unless it is unable to raise additional funds, it is unlikely the Company will be able to continue to retain the services of some or any of these consultants. 10 Item 3. Controls and Procedures (a) Evaluation of Disclosure Controls and Procedures. ------------------------------------------------------ The Company's Chief Executive Officer and Chief Financial Officer have conducted an evaluation of the Company's disclosure controls and procedures as of a date (the "Evaluation Date") within 90 days before the filing of this quarterly report. Based on their evaluation, the Company's Chief Executive Officer and Chief Financial Officer have concluded that the Company's disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the applicable Securities and Exchange Commission rules and forms. (b) Changes in Internal Controls and Procedures. ------------------------------------------------- Subsequent to the Evaluation Date, there were no significant changes in the Company's internal controls or in other factors that could significantly affect these controls, nor were any corrective actions required with regard to significant deficiencies and material weaknesses. PART II - OTHER INFORMATION Item 2. Changes in Securities No instruments defining the rights of the holders of any class of registered securities have been materially modified, limited or qualified during the quarter ended March 31, 2003. On January 3, 2003, the Company issued 150,000 restricted common shares to MediaComm Marketing for services to be rendered to the Company in connection with the development of its referral database and marketing of Office Managers' services. The shares were issued without registration under the Securities Act of 1933 in reliance on an exemption from registration provided by Section 4(2) of the Securities Act. No general solicitation was made in connection with the offer or sale of these securities. No funds were received by the Company for these shares. On January 3, 2003, 100,000 restricted common shares were issued to Vincent Gonzales and Associates for website development and maintenance services provided and to be to the Company. The shares were issued without registration under the Securities Act of 1933 in reliance on an exemption from registration provided by Section 4(2) of the Securities Act. No general solicitation was made in connection with the offer or sale of these securities. No funds were received by the Company for these shares. On January 3, 2003, the Company issued 250,000 restricted common shares to Roger Reynolds for investor and shareholder relations services to be provided to the Company. The shares were issued without registration under the Securities Act of 1933 in reliance on an exemption from registration provided by Section 4(2) of the Securities Act. No general solicitation was made in connection with the offer or sale of these securities. No funds were received by the Company for these shares. 11 On February 20, 2003 and March 29, 2003, the Company issued 1,000,000 and 900,000 restricted common shares to Charles Yourshaw and Yourshaw Engineering respectively for services rendered and to be rendered to the Company in connection with the operations of its wholly owned subsidiary Vogue Environmental Solutions, Inc. Pursuant to an agreement with Mr. Yourshaw, the Company also reimburses Mr. Yourshaw with restricted shares for expenses incurred on a monthly basis up to $10,000. On March 5, 2003 and May 5, 2003, the Company issued 29,411 and 29,412 restricted common shares respectively to Mr. Yourshaw based on an average stock price of $.37 during the preceding month. The Company issued 27,027 restricted shares to Mr. Yourshaw on April 2, 2003, based on an average stock price of $.34 during the preceding month. All shares issued to Mr. Yourshaw were issued without registration under the Securities Act of 1933 in reliance on an exemption from registration provided by Section 4(2) of the Securities Act. No general solicitation was made in connection with the offer or sale of these securities. No funds were received by the Company for these shares. On February 20, 2003, the Company issued 250,000 restricted common shares to David Wagner, for services rendered and to be rendered to the Company in connection with the operations of Vogue Environmental. The shares were issued without registration under the Securities Act of 1933 in reliance on an exemption from registration provided by Section 4(2) of the Securities Act. No general solicitation was made in connection with the offer or sale of these securities. No funds were received by the Company for these shares. On February 20, 2003, the Company issued 1,250,000 restricted common shares to consultants in China and Canada who have been and will continue to assist Vogue Environmental in securing appropriate manufacturing capabilities in China. The shares were issued without registration under the Securities Act of 1933 in reliance on an exemption from registration provided by Section 4(2) of the Securities Act. No general solicitation was made in connection with the offer or sale of these securities. No funds were received by the Company for these shares. On March 26, 2003, the Company issued 300,000 shares to two consultants who are designing and testing the electrical system for the Company's anaerobic digester system. The shares were issued without registration under the Securities Act of 1933 in reliance on an exemption from registration provided by Section 4(2) of the Securities Act. No general solicitation was made in connection with the offer or sale of these securities. No funds were received by the Company for these shares. On January 11, 2002, the Company's public offering pursuant to registration of units on Securities and Exchange Commission ("SEC") Form was declared effective by the SEC. The offering was conducted by the officers of the Company. The Company received subscriptions for 5,098,500 units and total proceeds of $5,098,050. The offering closed upon the expiration of the offering period on July 10, 2002. As the offering was not underwritten, the Company paid no underwriting expenses. No distribution expenses were paid during the quarter ended September 30, 2002, and no distribution expenses were or will be paid to any officer, director or affiliate of the Company. During the quarter ended September 30, 2002, the Company used approximately $46,373 of the proceeds of the offering to cover working capital costs. The Company paid nothing to Apex Resources Group, Inc., a related party, (formerly known as Ambra Resources Group, Inc.). The Company owes Ambra $50,530. Approximately $12,000 of the proceeds of the offering were paid to officers and directors of the Company as compensation incidental to their employment with the Company during the quarter ended March 31, 2003. 12 Item 6. Exhibits and Reports on Form 8-K Reports on Form 8-K None. (B) Exhibits. The following exhibits are included as part of this report: 99.1 Certification pursuant to Section 906 of the Sarbanes- Oxley Act of 2002 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this to be signed on its behalf by the undersigned thereunto duly authorized. Office Managers, Inc. May 14, 2003 /S/ John M. Hickey --------------------------------------- John M. Hickey, Chief Executive Officer May 14, 2003 /S/ John Ray Rask --------------------------------------- John Ray Rask, Chief Financial Officer 13 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, John M. Hickey certify that: (1) I have reviewed this quarterly report on Form 10-QSB of Office Managers, Inc., (the "Company"); (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 Company as of, and for, the periods presented in this quarterly report; (4) The Company's other certifying officer 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 Company and have: (a) designed such disclosure controls and procedures to ensure that material information relating to the Company 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 Company'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 Company's other certifying officer and I have disclosed, based on our most recent evaluation, to the Company's auditors and the audit committee of the Company's board of directors (or persons fulfilling the equivalent function): (a) all significant deficiencies in the design or operation of internal controls which could adversely affect the Company's ability to record, process, summarize and report financial data and have identified for the Company'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 Company's internal controls; and (6) The Company's other certifying officer 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: May 14, 2003 By: /S/ John M. Hickey --------------------------------------- John M. Hickey, President and Chief Executive Officer 14 CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, John Ray Rask, certify that: (1) I have reviewed this quarterly report on Form 10-QSB of Office Managers, Inc., (the "Company"); (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 Company as of, and for, the periods presented in this quarterly report; (4) The Company's other certifying officer 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 Company and have: (a) designed such disclosure controls and procedures to ensure that material information relating to the Company 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 Company'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 Company's other certifying officer and I have disclosed, based on our most recent evaluation, to the Company's auditors and the audit committee of the Company's board of directors (or persons fulfilling the equivalent function): (a) all significant deficiencies in the design or operation of internal controls which could adversely affect the Company's ability to record, process, summarize and report financial data and have identified for the Company'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 Company's internal controls; and (6) The Company's other certifying officer 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: May 14, 2003 By: /S/ John Ray Rask --------------------------------------- John Ray Rask, Secretary and Chief Financial Officer 15