Back to GetFilings.com
UNITED STATES
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 the quarterly period ended June 30, 2003
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 1-12108
GULFWEST ENERGY INC.
--------------------
(Exact name of Registrant as specified in its charter)
Texas 87-0444770
(State or other jurisdiction (IRS Employer
of incorporation) Identification No.)
480 North Sam Houston Parkway East
Suite 300
Houston, Texas 77060
(Address of principal executive offices) (zip code)
(281) 820-1919
(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 ____
The number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date, August 13, 2003, was 18,492,541 shares
of Class A Common Stock, $.001 par value.
GULFWEST ENERGY INC.
FORM 10-Q FOR THE QUARTER ENDED
JUNE 30, 2003
Page of
Form 10-Q
---------
Part I: Financial Statements
Item 1. Financial Statements
Consolidated Balance Sheets, June 30, 2003
and December 31, 2002 3
Consolidated Statements of Operations-for the three
months and six months ended June 30, 2003, and 2002 5
Consolidated Statements of Cash Flows-for the six
months ended June 30, 2003, and 2002 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 10
Item 3. Quantitative and Qualitative Disclosures about Market Risk 12
Part II: Other Information
Item 4. Submission of Matters to a Vote of Security Holders 13
Item 6. Exhibits and Reports on 8-K 13
Signatures 14
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
- ------- ---------------------
GULFWEST ENERGY INC.
CONSOLIDATED BALANCE SHEETS
JUNE 30, 2003 AND DECEMBER 31, 2002
ASSETS
June 30, December 31,
2003 2002
(Unaudited) (Audited)
---------------------- ----------------------
CURRENT ASSETS:
Cash and cash equivalents $ 641,152 $ 687,694
Accounts Receivable - trade, net of allowance for
doubtful accounts of -0- in 2002 and 2001 1,424,980 1,361,446
Prepaid expenses 340,570 303,906
---------------------- ----------------------
Total current assets 2,406,702 2,353,046
---------------------- ----------------------
OIL AND GAS PROPERTIES,
Using the successful efforts method of accounting 57,477,540 56,786,043
OTHER PROPERTY AND EQUIPMENT 2,121,410 2,121,410
Less accumulated depreciation, depletion
And amortization (9,565,573) (8,498,497)
---------------------- ----------------------
Net oil and gas properties, and
other property and equipment 50,033,377 50,408,956
---------------------- ----------------------
OTHER ASSETS
Deposits 20,142 37,442
Debt issue cost, net 181,964 289,497
---------------------- ----------------------
Total other assets 202,106 326,939
---------------------- ----------------------
TOTAL ASSETS $ 52,642,185 $ 53,088,941
====================== ======================
The Notes to Consolidated Financial Statements are an integral part of these statements.
3
GULFWEST ENERGY INC.
CONSOLIDATED BALANCE SHEETS
JUNE 30, 2003 AND DECEMBER 31, 2002
LIABILITIES AND STOCKHOLDERS' EQUITY
June 30, December 31,
2003 2002
(Unaudited) (Audited)
--------------------- ---------------------
CURRENT LIABILITIES
Notes payable $ 5,229,111 $ 4,936,088
Notes payable - related parties 1,290,000 1,290,000
Current portion of long-term debt 32,918,337 33,128,447
Current portion of long-term debt - related parties 139,587 256,967
Accounts payable - trade 3,928,671 3,928,477
Accrued expenses 356,963 458,587
--------------------- ---------------------
Total current liabilities 43,862,669 43,998,566
--------------------- ---------------------
NONCURRENT LIABILITIES
Long-term debt, net of current portion 104,840 126,552
Long-term debt, related parties 11,256
--------------------- ---------------------
Total noncurrent liabilities 104,840 137,808
--------------------- ---------------------
OTHER LIABILITIES
Derivative instruments 936,826 1,128,993
--------------------- ---------------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock 190 170
Common stock 18,493 18,493
Additional paid-in capital 29,283,692 28,258,212
Retained deficit (21,564,525) (20,453,301)
--------------------- ---------------------
Total stockholders' equity 7,737,850 7,823,574
--------------------- ---------------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 52,642,185 $ 53,088,941
===================== =====================
The Notes to Consolidated Financial Statements are an integral part of these statements.
4
GULFWEST ENERGY INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS AND SIX MONTHS ENDED
JUNE 30, 2003 AND 2002
(UNAUDITED)
Three Months Six Months
Ended June 30, Ended June 30,
2003 2002 2003 2002
--------------- -------------- --------------- ---------------
OPERATING REVENUES
Oil and gas sales $ 2,770,156 $ 2,813,776 $ 5,975,019 $ 5,340,018
Well servicing revenues 486 12,608
Operating overhead and other income 19,968 137,536 65,708 248,045
--------------- -------------- --------------- ---------------
Total operating revenues 2,790,124 2,951,798 6,040,727 5,600,671
--------------- -------------- --------------- ---------------
OPERATING EXPENSES
Lease operating expenses 1,392,440 1,343,545 2,762,375 2,720,228
Cost of well servicing operations 16,035 34,596
Depreciation, depletion and amortization 570,665 680,321 1,174,609 1,286,962
General and administrative 420,443 461,642 834,484 868,718
--------------- -------------- --------------- ---------------
Total operating expenses 2,383,548 2,501,543 4,771,468 4,910,504
--------------- -------------- --------------- ---------------
INCOME FROM OPERATIONS 406,576 450,255 1,269,259 690,167
--------------- -------------- --------------- ---------------
OTHER INCOME AND EXPENSE
Interest expense (811,770) (751,195) (1,572,650) (1,443,070)
Other financing costs (1,000,000) (1,000,000)
Gain on sale of assets 11,061
Unrealized gain (loss) on derivative instruments 173,311 24,005 192,167 (1,470,978)
--------------- -------------- --------------- ---------------
Total other income and expense (1,638,459) (727,190) (2,380,483) (2,902,987)
--------------- -------------- --------------- ---------------
INCOME (LOSS) BEFORE INCOME TAXES (1,231,883) (276,935) (1,111,224) (2,212,820)
INCOME TAXES --------------- -------------- --------------- ---------------
NET INCOME (LOSS) (1,231,883) (276,935) (1,111,224) (2,212,820)
DIVIDENDS ON PREFERRED STOCK (28,125) (56,250)
--------------- -------------- --------------- ---------------
NET INCOME (LOSS) AVAILABLE TO
COMMON SHAREHOLDERS $ (1,231,883) $ (305,060) $ (1,111,224) $ (2,269,070)
=============== ============== =============== ===============
NET INCOME (LOSS) PER COMMON SHARE, BASIC AND DILUTED $ (.07) $ (.02) $ (.06) $ (.12)
=============== ============== =============== ===============
The Notes to Consolidated Financial Statements are an integral part of these statements.
5
GULFWEST ENERGY INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
(UNAUDITED)
2003 2002
---------------- ----------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (1,111,224) $ (2,212,820)
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation, depletion, and amortization 1,174,609 1,286,962
Warrants issued and charged to earnings 25,500
Other financing costs 1,000,000
Loss (Gain) on sale of assets (11,061)
Unrealized (gain) loss on derivative instruments (192,167) 1,470,978
(Increase) decrease in accounts receivable - trade, net (63,534) (372,957)
(Increase) decrease in prepaid expenses (36,664) (120,426)
Increase (decrease) in accounts payable and accrued expenses 74,894 757,344
---------------- ----------------
Net cash provided by operating activities 871,414 798,020
---------------- ----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of property and equipment 668,247
Purchase of property and equipment (691,497) (4,199,193)
---------------- ----------------
Net cash used in investing activities (691,497) (3,530,946)
---------------- ----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on debt (526,459) (2,140,305)
Proceeds from debt issuance 300,000 4,782,918
Dividends Paid (56,250)
---------------- ----------------
Net cash provided by (used) in financing activities (226,459) 2,586,363
---------------- ----------------
DECREASE IN CASH AND CASH EQUIVALENTS (46,542) (146,563)
CASH AND CASH EQUIVALENTS, beginning of period 687,694 689,030
---------------- ----------------
CASH AND CASH EQUIVALENTS, end of period $ 641,152 $ 542,467
================ ================
CASH PAID FOR INTEREST $ 1,491,948 $ 1,423,013
================ ================
The Notes to Consolidated Financial Statements are an integral part of these statements.
6
GULFWEST ENERGY INC. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2003 AND 2002
(UNAUDITED)
1. During interim periods, we follow the accounting policies set forth in our
Annual Report on Form 10-K filed with the Securities and Exchange
Commission. Users of financial information produced for interim periods are
encouraged to refer to the footnotes contained in the Annual Report when
reviewing interim financial results.
2. The accompanying financial statements include the Company and its
wholly-owned subsidiaries: RigWest Well Service, Inc. formed September 5,
1996; GulfWest Texas Company formed September 23, 1996; DutchWest Oil
Company formed July 28, 1997; Southeast Texas Oil and Gas Company, L.L.C.
acquired September 1, 1998; SETEX Oil and Gas Company formed August 11,
1998; GulfWest Oil and Gas Company formed February 8, 1999; LTW Pipeline
Co. formed April 19, 1999; and GulfWest Development Company ("GWD") formed
November 9, 2000; and, GulfWest Oil and Gas Company (Louisiana) LLC formed
July 31, 2001. All material intercompany transactions and balances are
eliminated upon consolidation.
3. In management's opinion, the accompanying interim financial statements
contain all material adjustments, consisting only of normal recurring
adjustments necessary to present fairly the financial condition, the
results of operations, and the statements of cash flows of GulfWest Energy
Inc. for the interim periods.
4. Non-cash Investing and Financing
During the six month period ended June 30, 2003, we applied $17,300 in
deposits and added $176,324 in accrued interest to notes payable. Also
during the quarter, $1 million in preferred stock was issued to an energy
lender as required by an agreement that expired on May 29,2003.
During the six month period ended June 30, 2002, we acquired $48,224 of
property and equipment through notes payable to financial institutions. We
also acquired $182,742 of oil producing properties in exchange of accounts
receivable from a related party.
5. As a result of a financing agreement with an energy lender, we were
required to enter into an oil and gas hedging agreement with the lender. It
has been determined this agreement meets the definition of SFAS 133
"Accounting for Derivative Instruments and Hedging Activities" and is
accounted for as a derivative instrument.
We entered into the agreement, commencing in May 2000, to hedge a portion
of our oil and gas sales for the period of May 2000 through April 2004. The
agreement calls for initial volumes of 7,900 barrels of oil and 52,400 Mcf
of gas per month, declining monthly thereafter. We entered into a second
agreement with the energy lender, commencing September 2001, to hedge an
additional portion of our oil and gas sales for the periods of September
2001 through July 2004 and September 2001 through December 2002,
respectively. The agreement calls for initial volumes of 15,000 barrels of
oil and 50,000 Mmbtu of gas per month, declining monthly thereafter. As a
result of these agreements, we realized a reduction in revenues of $884,045
for the six-month period ended June 30, 2002 and an increase in revenues of
$84,595 for the six-month period ended June 30, 2002, which is included in
oil and gas sales.
The estimated change in fair value of the derivatives is reported in Other
Income and Expense as unrealized (gain) loss on derivative instruments. The
estimated fair value of the derivatives is reported in Other Assets (or
Other Liabilities) as derivative instruments.
7
6. Stock Based Compensation
In October 1995, SFAS No. 123, "Stock Based Compensation," (SFAS 123) was
issued. This statement requires that we choose between two different
methods of accounting for stock options and warrants. The statement defines
a fair-value-based method of accounting for stock options and warrants but
allows an entity to continue to measure compensation cost for stock options
and warrants using the accounting prescribed by APB Opinion No. 25 (APB
25), "Accounting for Stock Issued to Employees." Use of the APB 25
accounting method results in no compensation cost being recognized if
options are granted at an exercise price at the current market value of the
stock or higher. We will continue to use the intrinsic value method under
APB 25 but are required by SFAS 123 to make pro forma disclosures of net
income (loss) and earnings (loss) per share as if the fair value method had
been applied in its 2003 and 2002 financial statements.
If we had used the fair value method required by SFAS 123, our net loss and
per share information would approximate the following amounts:
Three months 2003 2002
-------------------- ------------------------- -------------------------
As Reported Proforma As Reported Proforma
SFAS 123
compensation cost $ $ 7,350 $ $ 32,000
APB 25
compensation cost $ $ $ $
Net income (loss) $ (1,231,883) $ (1,239,233) $ (305,060) $ (337,060)
Income (loss) per
common share-basic
and diluted $ (.07) $ (.07) $ (.02) $ (.02)
Six months 2003 2002
-------------------- ------------------------- ---------------------------
As Reported Proforma As Reported Proforma
SFAS 123
compensation cost $ $ 7,350 $ $ 32,000
APB 25
compensation cost $ $ $ $
Net income (loss) $ (1,111,224) $ (1,118,574) $ (2,269,070) $ (2,301,070)
Income (loss) per
common share-basic
and diluted $ (.06) $ (.06) $ (.12) $ (.12)
8
7. As shown in the financial statements, we had a working capital deficiency
of $41,455,967 at June 30, 2003 and $41,645,520 for the year ended December
31, 2002. This and other conditions raise substantial doubt about our
ability to continue as a going concern.
8. In a subsequent event, on July 24, 2003 we signed a letter of agreement
with Starlight Corporation of Denver to pursue a merger of the two
companies. A definitive agreement and plan of merger is being developed,
which will be subject to board and shareholder approval by both companies,
as well as regulatory approvals and customary due diligence.
The merger will be achieved through a stock-for-stock exchange, whereby
100% of the Starlight stock will be exchanged for GulfWest stock with
GulfWest as the surviving entity. The merger is contingent upon achieving
consolidated re-financing of the combined company with terms agreeable to
both parties, as well as GulfWest's largest debt holder. The refinancing
will include significant new capital for development projects on the Gulf
Coast and in the Rockies to provide growth potential.
9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
- ------- ------------------------------------
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
------------------------------------------------
Overview
- --------
We are engaged primarily in the acquisition, development, exploitation,
exploration and production of crude oil and natural gas. Our focus is on
increasing production from our existing crude oil and natural gas properties
through the further exploitation, development and optimization of those
properties, and on acquiring additional crude oil and natural gas properties.
Our gross revenues are derived from the following sources:
1. Oil and gas sales that are proceeds from the sale of crude oil and
natural gas production to midstream purchasers;
2. Operating overhead and other income that consists of earnings from
operating crude oil and natural gas properties for other working
interest owners, and marketing and transporting natural gas. This also
includes earnings from other miscellaneous activities.
3. Well servicing revenues that are earnings from the operation of well
servicing equipment under contract to third party operators.
Results of Operations
- ---------------------
The factors which most significantly affect our results of operations are
(1) the sales price of crude oil and natural gas, (2) the level of total sales
volumes of crude oil and natural gas, (3) the level of and interest rates on
borrowings and, (4) the level and success of new acquisitions and development of
existing properties.
Comparative results of operations for the periods indicated are discussed below.
Three-Month Period Ended June 30, 2003 compared to Three Month Period Ended June
30, 2002.
Revenues
Oil and Gas Sales. Revenues from the sale of crude oil and natural gas for
the quarter decreased 2% from $2,813,800 in 2002 to $2,770,200 in 2003. This was
due to a decrease in sales volumes, partially offset by an increase in oil and
gas prices.
Operating Overhead and Other Income. Revenues from these activities
decreased 85% from $137,500 in 2002 to $20,000 in 2003. This was due to the
expiration of a natural gas marketing contract and a reduced number of wells
operated for other working interest owners.
Costs and Expenses
Lease Operating Expenses. Lease operating expenses increased 4% from
$1,343,500 in 2002 to $1,392,400 in 2003. This was primarily due to increases in
insurance, labor, supplies and equipment costs.
Depreciation, Depletion and Amortization (DD and A). DD and A decreased 16%
from $680,300 in 2002 to $570,700 in 2003, due to lower sales volumes.
General and Administrative (G and A) Expenses. G and A expenses decreased
9% for the period from $461,600 in 2002 to $420,400 in 2003, due to a reduction
in administrative personnel resulting in less payroll.
10
Interest Expense. Interest expense increased 8% from $751,200 in 2002 to
$811,800 in 2003, primarily due to increased debt for funding of capital
development projects.
Six-Month Period Ended June 30, 2003 compared to Six-Month Period Ended June 30,
2002.
Revenues
Oil and Gas Sales. Revenues from the sale of crude oil and natural gas for
the period increased 12% from $5,340,000 in 2002 to $5,975,000 in 2003. This was
due to an increase in oil and gas prices, which offset a decrease in volume.
Operating Overhead and Other Income. Revenues from these activities
decreased 74% from $248,000 in 2002 to $65,700 in 2003. This was due to the
expiration of a natural gas marketing contract and a reduced number of wells
operated for other working interest owners.
Costs and Expenses
Lease Operating Expenses. Lease operating expenses increased 2% from
$2,720,200 in 2002 to $2,762,400 in 2003, due to slightly higher insurance,
labor, supplies and equipment costs.
Depreciation, Depletion and Amortization (DD and A). DD and A decreased 9%
from $1,287,000 in 2002 to $1,174,600 in 2003, due to lower sales volumes.
General and Administrative (G and A) Expenses. G and A expenses decreased
4% for the period from $868,700 in 2002 to $834,500 in 2003, due to a reduction
in administrative personnel resulting in less payroll.
Interest Expense. Interest expense increased 9% from $1,443,100 in 2002 to
$1,572,600 in 2003, primarily due to increased debt for funding of capital
development projects.
Financial Condition and Capital Resources
- -----------------------------------------
At June 30, 2003, our current liabilities exceeded our current assets by
$41,455,967. We had a loss of $231,883 for the quarter compared to a loss of
$305,060 for the period in 2002.
During the second quarter of 2003, we sold 59,414 barrels of crude oil and
307,238 Mcf of natural gas compared to 70,189 barrels of crude oil and 430,062
Mcf of natural gas in the second quarter of 2002. Revenue for crude oil sales
for the quarter was $1,397,770 in 2003 compared to $1,456,141 in 2002 and for
natural gas sales was $1,372,386 in 2003 compared to $1,357,635 in 2002.
As part of our financing effort, on February 28, 2003, we entered into an
agreement with our major lender to buy-out its loan, which had a balance at that
date of $27.9 million, for a cash payment of $20 million. The agreement expired
on May 29, 2003 and because we were unable to close the transaction, we were
required to issue the lender $1 million of preferred stock.
In a subsequent event, on July 24, 2003 we signed a letter of agreement
with Starlight Corporation of Denver to pursue a merger of the two companies. A
definitive agreement and plan of merger is being developed, which will be
subject to board and shareholder approval by both companies, as well as
regulatory approvals and customary due diligence.
11
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
- ------- ----------------------------------------------------------
The following market rate disclosures should be read in conjunction with
the quantitative disclosures about market risk contained in the Company's 2002
annual report on Form 10-K, as well as with the consolidated financial
statements and notes thereto included in this quarterly report on Form 10-Q.
All of the Company's financial instruments are for purposes other than
trading. The Company only enters derivative financial instruments in conjunction
with its oil and gas hedging activities.
Hypothetical changes in interest rates and prices chosen for the following
stimulated sensitivity effects are considered to be reasonably possible
near-term changes generally based on consideration of past fluctuations for each
risk category. It is not possible to accurately predict future changes in
interest rates and product prices. Accordingly, these hypothetical changes may
not be an indicator of probable future fluctuations.
Interest Rate Risk
The Company is exposed to interest rate risk on debt with variable interest
rates. At June 30, 2003, the Company carried variable rate debt of $38,394,730.
Assuming a one percentage point change at June 30, 2003 on the Company's
variable rate debt, the annual pretax income would change by $383,947.
Commodity Price Risk
The Company hedges a portion of its price risks associated with its oil and
natural gas sales which are classified as derivative instruments. As of June 30,
2003, these derivative instruments' liabilities had a fair value of $936,826. A
hypothetical change in oil and gas prices could have an effect on oil and gas
futures prices, which are used to estimate the fair value of our derivative
instrument. However, it is not practicable to estimate the resultant change, in
any, in the fair value of our derivative instrument.
ITEM 4. CONTROLS AND PROCEDURES
- ------- -----------------------
Based on an evaluation of the Company's disclosure controls and procedures
performed by the Company's management within 90 days of the filing date of this
report, the Company's Chief Executive Officer and Chief Financial Officer
believe that the Company has appropriate disclosure controls and procedures to
ensure that information required to be disclosed by the Company in its periodic
reports is recorded, processed, summarized and reported within the time periods
specified in the rules and forms of the Securities and Exchange Commission.
Since the date of such evaluation, there have been no significant changes
in the Company's internal controls or in other factors that could significantly
affect these controls, including any corrective actions with regard to
significant deficiencies and material weaknesses.
12
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
- ------- ----------------------------------------------------
The annual meeting of shareholders was held on June 12, 2003 to
consider the election of five persons to the board of directors of the
Company (the "Board") and to transact such other business as might properly
come before the meeting. Of the 18,492,541 outstanding shares of Common
Stock, there were present, in person or by proxy, shareholders holding a
total of 15,037,185 (81%) of the shares.
Five candidates for director were presented by the Board: J. Virgil
Waggoner, Marshall A. Smith III, Thomas R. Kaetzer, John E. Loehr and M.
Scott Manolis. Of the 15,037,185 shares of Common Stock present in person
or by proxy and entitled to be voted at the meeting, 15,035,650 votes were
cast for each of the nominees for director of the Corporation (except for
Mr. Waggoner for whom 2,900 of those votes were withheld and for Mr.
Kaetzer, Mr. Smith and Mr. Loehr for whom 2,000 votes were withheld), no
votes were cast against the nominees and 1,535 votes abstained. All five
candidates were declared duly and validly elected members of the Board,
each to serve until the next annual meeting of shareholders or until his
respective successor has been elected and qualified. Following the
shareholders' meeting, the Board elected Mr. J. Virgil Waggoner as Chairman
of the Board.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
- ------- ---------------------------------
(a) Exhibits -
Number Description
------ -----------
*3.1 Articles of Incorporation of the Registrant and
Amendments thereto.
**3.2 Amendment to the Articles of Incorporation of
the Registrant changing the name of the
Registrant to "GulfWest Energy Inc.",
approved by the Shareholders on May 18,
2001 and filed with the Secretary of Texas on
May 21, 2001.
***3.3 Amendment to the Company's Articles of Incorpo-
ration to increase the number of shares of
Class A Common Stock that the Company will have
authority to issue from 20,000,000 to
40,000,000 shares, approved by the
Shareholders on November 19, 1999 and filed
with the Secretary of State of Texas on
December 3, 1999.
*3.4 Bylaws of the Registrant.
**10.1 GulfWest Oil Company 1994 Stock Option and
Compensation Plan, amended and restated as
of April 1, 2001, and approved by the
shareholders on May 18, 2001.
---------------
* Previously filed with the Registrant's
Registration Statement (on Form S-1, Reg. No.
33-53526), filed with the Commission on
October 21, 1992.
** Previously filed with the Registrant's
Definitive Proxy Statement, filed with the
Commission on April 16, 2001.
*** Previously filed with the Registrant's
Definitive Proxy Statement, filed with the
Commission on October 18, 1999.
13
SIGNATURES
Pursuant to the requirements of Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
GULFWEST ENERGY INC.
(Registrant)
Date: August 13, 2003 By: /s/ Thomas R. Kaetzer
--------------------------------
Thomas R. Kaetzer
President
Date: August 13, 2003 By: /s/ Jim C. Bigham
--------------------------------
Jim C. Bigham
Executive Vice President
and Secretary
Date: August 13, 2003 By: /s/ Richard L. Creel
--------------------------------
Richard L. Creel
Vice President of Finance
14
CERTIFICATIONS
I, Thomas R. Kaetzer, certify that:
1. I have reviewed this quarterly report on Form 10-Q of GulfWest Energy
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 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 functions):
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
i
6. The registrant's other certifying officers and I have indicated in
this quarterly report whether 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: August 13, 2003
/s/ Thomas R. Kaetzer
-----------------------------------
Thomas R. Kaetzer
President and Chief Executive Officer
ii
CERTIFICATIONS
I, Richard L. Creel, certify that:
1. I have reviewed this quarterly report on Form 10-Q of GulfWest Energy
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 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 functions):
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
i
6. The registrant's other certifying officers and I have indicated in
this quarterly report whether 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: August 13, 2003
/s/ Richard L. Creel
-----------------------------------
Richard L. Creel
Vice President of Finance
ii
August 13, 2003
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Certification Required Under Section 906 of Sarbanes-Oxley Act of 2002
In connection with the accompanying report on Form 10-Q for the period ended
June 30, 2003, and filed with the Securities and Exchange Commission on the date
hereof (the "Report"), We, Thomas R. Kaetzer, President and CEO of GulfWest
Energy Inc. (the "Company"), and Richard L. Creel, Vice President of Finance of
the Company hereby certify 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.
GulfWest Energy Inc.
/s/ Thomas R. Kaetzer
- ------------------------------------
By: Thomas R. Kaetzer
President and Chief Executive Officer
/s/ Richard L. Creel
- ------------------------------------
By: Richard L. Creel
Vice President of Finance