SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
[X] Quarterly report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarter ended December 29, 2002
[ ] Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Commission file number: 0-22048
STARCRAFT CORPORATION
(Exact name of registrant as specified in its charter)
Indiana 35-1817634
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Post Office Box 1903
2703 College Avenue
Goshen, Indiana 46528
(Address of principal executive offices/zip code)
Registrant's telephone number, including area code: 574/533-1105
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 : No
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: January 27, 2003 - 4,509,342
shares of Common Stock, without par value.
- INDEX -
PART I. FINANCIAL INFORMATION PAGE
----
Item 1. Financial Statements
Balance Sheets - December 29, 2002 (unaudited) 1
and September 29, 2002 (Audited)
Statements of Operations (Unaudited) for the three month 2
periods ended December 29, 2002 and December 30, 2001
Statements of Cash Flow (Unaudited) for the three month 3
periods ended December 29, 2002 and December 30, 2001
Notes to Financial Statements 4-7
Item 2. Management's Discussion and Analysis 8-11
Item 4. Controls and Procedures 12
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 14
CERTIFICATIONS 15-19
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
STARCRAFT CORPORATION
(Unaudited) (Audited)
BALANCE SHEETS December 29, 2002 September 29, 2002
----------------- ------------------
(Dollars in Thousands)
ASSETS
Current Assets
Cash and cash equivalents....................... $ 366 $ 284
Accounts receivable trade, less allowance for doubtful
accounts: $280 at December 29, 2002
and $288 at September 29, 2002............. 20,463 20,610
Tooling and engineering services................ 42 2,108
Notes receivable................................ 63 63
Inventories ................................... 6,993 8,204
Other ................................... 4,239 1,863
----------- -------------
Total current assets........................ 32,166 33,132
Property and Equipment
Land, buildings, and improvements............... 4,109 3,820
Machinery and equipment......................... 5,816 4,540
----------- -------------
9,925 8,360
Less accumulated depreciation................... (3,165) (2,836)
----------- -------------
6,760 5,524
Other assets ................................... 553 436
----------- -------------
$ 39,479 $ 39,092
=========== =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Notes payable to related parties ............... $ 1,474 $ 1,474
Accounts payable, trade......................... 16,411 18,058
Accrued expenses:
Warranty.................................... 856 771
Compensation and related expenses........... 2,042 2,302
Taxes....................................... 711 440
Indemnification reserves.................... 322 346
Other....................................... 601 675
----------- -------------
Total current liabilities 22,417 24,066
Long -Term Debt ................................... 10,995 12,704
Commitments and Contingencies........................ -- --
Minority Interest in Subsidiary...................... 3,725 1,991
Shareholders' Equity
Preferred Stock, no par value; authorized ..... --- ---
but unissued 2,000,000 shares
Common Stock, no par value;
10,000,000 shares authorized
4,486,259 shares issued as of December 29, 2002
and 4,454,059 shares as of September 29, 2002 14,907 14,850
Additional paid-in capital..................... 1,008 1,008
Accumulated deficit............................. (13,573) (15,527)
----------- -------------
Total shareholders' equity ................ 2,342 331
----------- -------------
$ 39,092 $ 39,479
=========== =============
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
STARCRAFT CORPORATION
STATEMENTS OF OPERATIONS
3 Months Ended
-----------------------------------------
(Unaudited) (Unaudited)
December 29, 2002 December 30, 2001
----------------- -----------------
(Dollars in thousands, except per share amounts)
Net Sales $ 39,882 $ 20,910
Cost of Goods Sold ......................... 31,015 16,012
------------- -------------
Gross profit ...................... 8,867 4,898
Operating Expenses
Selling and promotion ................. 383 267
General and administrative 4,489 2,563
------------- -------------
Operating Income....................... 3,995 2,068
Nonoperating (Expense) Income
Interest, net ......................... (113) (101)
Other, net .......................... 43 22
------------- -------------
(70) (79)
------------- -------------
Income before minority
interest and income taxes ........ 3,925 1,989
Minority Interest in income of Subsidiary 1,734 1,025
------------- -------------
Income before income taxes 2,191 964
Income Taxes 238 72
-------------- --------------
Net Income $ 1,953 $ 892
============== =============
Basic Earnings per share $ 0.44 $ 0.21
============= =============
Dilutive earnings per share $ 0.41 $ 0.20
============= =============
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
STARCRAFT CORPORATION
STATEMENTS OF CASH FLOW
3 Months Ended
-------------------------------------------
(Unaudited) (Unaudited)
December 29, 2002 December 30, 2001
----------------- -----------------
(Dollars in Thousands)
Operating Activities
Net Income ......................... $ 1,953 $ 892
Adjustments to reconcile net income
to net cash from operations:
Depreciation and amortization ..... 329 195
Minority Interest.................. 1,734 776
Change in operating
assets and liabilities:
Receivables ...................... 2,213 (1,687)
Inventories ...................... 1,211 192
Other current assets ............. (2,376) 103
Accounts payable .................. (1,647) (143)
Accrued expenses .................. (2) (44)
----------------- -----------------
Net cash from operating activities. 3,415 284
Investing Activities
Purchase of property and equipment (1,564) (120)
Other assets ......................... (117) 4
------------------ -----------
Net cash from investing activities (1,681) (116)
Financing Activities
Borrowings on credit agreements .... 2,036 512
Repayments on credit agreements .... (3,745) (483)
Issuance of Common Stock............... 57 19
----------------- -----------
Net cash from financing activities (1,652) 48
Increase in Cash and Cash
Equivalents ........................... 82 216
Cash and cash equivalents at
beginning of period................. 284 300
----------------- -----------------
Cash and cash equivalents at
end of period....................... $ 366 $ 516
================= =================
NOTES TO FINANCIAL STATEMENTS
STARCRAFT CORPORATION
December 29, 2002
Note 1. Basis of Presentation
The accompanying unaudited financial statements of Starcraft
Corporation (the "Company") have been prepared pursuant to the rules
and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in annual
financial statements prepared in accordance with accounting principles
generally accepted in the United States of America have been condensed
or omitted pursuant to those rules and regulations. Reference is made
to the Company's audited financial statements set forth in its annual
report on Form 10-K for its fiscal year ended September 29, 2002.
In the opinion of the management of the Company, the unaudited
financial statements contain all adjustments (which include only
normally recurring adjustments) necessary for a fair statement of the
results of operations for the three month period ended December 29,
2002 and the three month period ended December 30, 2001. The results
of operations for the three months ended December 29, 2002 are not
necessarily indicative of the results which may be expected for the
fiscal year ending September 28, 2003.
Note 2. Inventories
The composition of inventories is as follows (dollars in thousands):
(Unaudited) (Audited)
December 29, 2002 September 29, 2002
----------------- ------------------
Raw Materials $ 6,054 $ 7,568
Finished Goods 1,035 723
--------------- ------------
7,089 8,291
Allowance for slow-moving
and obsolete inventories (96) (87)
---------------- ----------------
Total $ 6,993 $ 8,204
============== ============
Note 3. Earnings Per Share
The computation of basic and dilutive earnings per share follows (in
thousands, except share and per share amounts):
3 Months Ended
------------------------------------------
(Unaudited) (Unaudited)
December 29, 2002 December 30, 2001
----------------- -----------------
Basic earnings per share
Net income available
to common stockholders $ 1,953 $ 892
============= =============
Weighted average common
shares outstanding 4,462 4,263
============== =============
Basic earnings per share $ 0.44 $ 0.21
============== =============
Dilutive earnings per share
Net income available
to common stockholders $ 1,953 $ 892
============= =============
Weighted average common
shares outstanding 4,462 4,263
Add: Potential dilutive effects of
incentive stock options 333 231
------------ -------------
Weighted average potential
dilutive common shares outstanding 4,795 4,494
============ =============
Dilutive earnings per share $ 0.41 $ 0.20
============= =============
Note 4. Operating Segment Information
The tables below present information about segments used by the chief
operating decision maker of the Company for the three month periods ended
December 29, 2002 and December 30, 2001. (Dollars in thousands; unaudited)
3 Months Ended
---------------------------------------------
December 29, 2002 December 30, 2001
----------------- ------------------
Net sales by geographic region:
OEM automotive supply
Domestic $ 39,069 $ 20,164
Export -- --
Automotive parts and products:
Domestic 770 716
Export 43 30
------------- -------------
$ 39,882 $ 20,910
============ =============
Operating income (loss):
OEM automotive supply
(net of minority interest) $ 2,055 $ 1,176
Automotive parts and products (86) (69)
------------ -------------
$ 1,969 $ 1,107
============ =============
The following provides a reconciliation of segment information to
consolidated information:
3 Months Ended
---------------------------------------------
December 29, 2002 December 30, 2001
----------------- ------------------
Operating income: $ 1,969 $ 1,107
Non-operating expenses (70) (79)
Federal and state income tax expense (238) (72)
Unallocated corporate income / (expense) 292 (64)
------------ -------------
Net income: $ 1,953 $ 892
============ =============
(Audited)
December 29, 2002 September 29, 2002
----------------- ------------------
Total Assets:
OEM automotive supply $ 36,248 $ 36,026
Automotive parts and products 3,231 3,066
------------ ------------
$ 39,479 $ 39,092
============ ============
Note 5 - Notes Payable To Related Parties
On September 25, 2002, the Company reached an agreement to redeem and cancel
360,000 outstanding warrants and 500,000 outstanding stock options previously
issued to two individuals, both of whom are currently directors and one of whom
is an officer of the Company, as incentive for their guarantee of certain of the
Company's debt. The total cost of the redemption was $2,474. The redemption
price of $2,474 consisted of $1,000 in cash and notes payable of $1,474. The
notes payable, which are unsecured, bear interest at 6.75% and are payable in
equal monthly installments beginning in January 2003, with the final installment
on or before June 15, 2003.
Note 6 - Warranty Expense
The Company's OEM Automotive Supply segment provides products to Original
Equipment Manufacturers ("OEM") under warranty terms similar to terms offered by
the OEM to its customers which is generally 3 years or 36,000 miles. The Company
accrues an estimated liability for potential warranties at the time products are
sold, based on past experience.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
STARCRAFT CORPORATION
RESULTS OF OPERATIONS
Comparison of the three months ended December 29, 2002
(First Quarter Fiscal Year 2003) to the three
months ended December 30, 2001 (First Quarter
Fiscal Year 2002)
Net sales for the quarter ended December 29, 2002 increased $19.0 million to
$39.9 million from $20.9 million for the quarter ended December 30, 2001. OEM
Automotive Supply sales increased $18.9 million to $39.1 million from $20.2
million. Three of the OEM Automotive Supply's plants were in production in the
first quarter of fiscal 2003. A new fourth plant was in the start-up phase and
is expected to begin commercial operation in the second quarter of fiscal 2003.
Automotive parts and product sales increased $.1 million to $.8 million.
Gross profit increased to $8.9 million (22.2% of sales) for the first fiscal
quarter of 2003 from $4.9 million (23.4% of sales) for the same quarter fiscal
2002. The increase in gross profits is attributable to the higher sales levels
in the OEM Automotive Supply segment. The decrease in gross profit margin
percentage was primarily due to sales of the H2 Hummer parts in the current
quarter, which have a lower profit margin than the Company's other products.
There were no H2 Hummer sales in the year earlier quarter.
Selling and promotion expense was $.4 million for the first quarter of fiscal
2003 quarter compared to $.3 million for the fiscal 2002 quarter. General and
administrative expense was $4.5 million for the first quarter of fiscal 2003
quarter compared to $2.6 million for the fiscal 2002 quarter. These expenses are
primarily attributed to higher salary and wage related expenses incurred in the
OEM Automotive Supply segment to support higher sales and production levels. In
addition, prototype expenses were $0.3 million in the current quarter, compared
to $0.1 million in the year earlier period. The Company also incurred $0.2
million of expenses in the current quarter related to the change in OEM
Automotive Supply's facility in Texas.
Interest expense was $.1 million, approximating prior year levels. Minority
interest was $1.7 million, resulting from the Company owning 50% of the OEM
Automotive Supply segment. Taxes increased to $0.2 million due to state income
taxes on the higher income. The Company does not have federal income tax expense
at this time, due to deferred tax assets recorded for existing net operating
loss tax carry forwards generated from prior years losses.
SEASONALITY AND TRENDS
The Company's OEM automotive supply business' sales and profits are dependent on
the automotive markets in the United States. The business is influenced by a
number of factors including OEM plant shutdowns, model year changeovers,
atypical weather for any sales region, interest rates, gasoline prices, and OEM
programs affecting price and supply. The OEM automotive supply segment is
dependent upon long-term contracts.
LIQUIDITY AND CAPITAL RESOURCES
Funds available from operations and under the Company's revolving credit
agreements were adequate to finance operations and provide for capital
expenditures during the three months ended December 29, 2002.
Operations generated $3.4 million of cash in the first three months of fiscal
2003 compared to generating $0.3 million in the fiscal 2002 period. Trade
receivables at December 29, 2002 were slightly lower than at September 29, 2002.
Inventory balances at December 29, 2002 were $7.0 million, down $1.2 million
from the balances on hand at September 29, 2002, primarily due to a reduction of
inventory at the OEM automotive supply unit's Texas facility. The Texas facility
had somewhat higher than normal inventory balances at September 29, 2002, due to
the relocation to a new production facility in fiscal 2002. Other current assets
were $4.2 million at December 29, 2002 compared to $1.9 million at September 29,
2002; this increase is primarily attributed to the investment in potential new
sales programs by the OEM Automotive supply segment and timing of tooling and
engineering reimbursements from customers.
In February 2002, the Company's OEM Automotive Supply segment ("Tecstar")
entered into a $10 million revolving credit agreement with a new lending
institution, which matures on April 1, 2004. In May 2002, the facility was
amended to increase the size of the facility to accommodate growth in Tecstar's
business. Advances under the amended agreement are limited to a specified
percentage of eligible receivables and inventories, subject to a maximum of $15
million. At December 29, 2002, Tecstar had $9.3 million of outstanding advances
under its revolving facility. The advances bear interest subject to a margin
table with ranges of 1/2% below the prime rate to 1/2% above the prime rate,
dependent upon Tecstar's tangible net worth. The borrowings are collateralized
by substantially all of Tecstar's assets. This facility is subject to various
loan covenants with which Tecstar is in compliance as of December 29, 2002.
In June 2002, the Company entered into a $2 million revolving credit agreement,
which matures on April 1, 2004, with the same lending institution that provided
Tecstar's credit facility. At December 29, 2002, the Company had $1.6 million of
outstanding borrowings under its revolving credit facility. Advances under the
revolving credit agreement bear interest at a rate of 1% over the prime rate and
are collateralized by substantially all of the Company's assets. In addition, a
portion of the credit facility is guaranteed by two individuals, both of whom
are directors and one of whom is an officer of the Company. The facility is
subject to various loan covenants with which the Company is in compliance as of
December 29, 2002.
The Company believes that future cash flows from operations and funds available
under its revolving credit agreement, and refinanced credit facilities will be
sufficient to satisfy its anticipated operating needs and capital requirements
for 2003. The Company also believes that its objectives for growth over the next
few years can be accomplished with minimal capital investment and that its
internal resources and existing or refinanced credit facilities will provide
sufficient liquidity for such purposes.
MANUFACTURING
All components for the OEM automotive supply segment are purchased from outside
suppliers. The primary raw material used in the components is plastic that the
Company believes is readily available from several sources. One of Tecstar's
primary plastics vendors has recently experienced serious financial
difficulties. To date, no supply problems have been encountered. However, to
mitigate any potential supply disruptions, Tecstar has begun establishing
relationships with additional suppliers.
The OEM Automotive Supply segment program related to the Shreveport, Louisiana
facility is due to end in September 2003. Sales for this program were $3.6
million (9.0% of total company sales), $2.6 million (12.4% of total company
sales) and $9.4 million (9.0% of total company sales) for the first quarter of
2003, first quarter of 2002 and fiscal year 2002, respectively. GM has announced
plans to introduce a replacement vehicle to be produced in GM's Shreveport,
Louisiana facility. The Company intends to aggressively pursue any new business
in Shreveport, but is uncertain of the outcome at this time.
The Company's OEM Automotive Supply segment provides products to Original
Equipment Manufacturers under warranty terms similar to these offered by the OEM
to its customers. The Company accrues an estimated liability for potential
warranties at the time products are sold, based on past claims experience.
APPLICATION OF CRITICAL ACCOUNTING POLICIES
In the course of normal business and in the preparation of its consolidated
financial statements in accordance with accounting principles generally accepted
in the United States, Management is required to make estimates and assumptions
that affect the amounts reported in the financial statements. Actual results
could differ from those estimates. Some of the more significant policies
include:
Revenue Recognition: The Company generally manufactures products based on
specific orders from customers. Shipments are generally made by common carrier
after receiving authorization from the customer, and revenue is recognized upon
shipment under FOB factory terms.
Warranties: The Company follows the policy of accruing an estimated liability
for warranties at the time the warranted products are sold. The estimate is
generally based on past claims experience.
Property and Equipment: Property and equipment are stated at cost. Depreciation
is computed principally by the straight-line method over the estimated useful
lives of the assets. The Company is depreciating buildings over periods of 15 to
50 years, building improvements over periods of 5 to 20 years, and equipment
over periods of 3 to 12 years.
The foregoing discussion contains forward-looking statements regarding economic
conditions and trends, adequacy of capital resources, seasonality and supply of,
and demand for, the Company's products, and the prospects of Management's
operating strategies, all of which are subject to a number of important factors
which may cause the Company's projections to be materially inaccurate. Some of
such factors are described in the Company's Form 10-K for the year ended
September 29, 2002, under the subsection entitled "Discussion of Forward-Looking
Information" which is incorporated herein by reference.
ITEM 4. CONTROLS AND PROCEDURES
Within the 90-day period prior to the filing of this report, an evaluation was
carried out under the supervision and with the participation of the Company's
management, including the Chief Executive Officer ("CEO") and Chief Financial
Officer ("CFO"), of the effectiveness of the Company's disclosure controls and
procedures. Based on that evaluation, the CEO and CFO 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 Securities and
Exchange Commission rules and forms. Subsequent to the date of their evaluation,
there were no significant changes in the Company's internal financial controls
or in other factors that could significantly affect such controls, nor any
corrective actions with regard to significant deficiencies and material
weaknesses in such controls.
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) The following exhibits are filed with this report
10.1.1 Employment agreement between Starcraft Corporation and
Michael H. Schoeffler, dated January 2, 2003.
(b) No reports on Form 8-K were filed by the registrant for the Period
covered by this report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly cuased this report to be signed on its behalf by the
undersigned thereunto duly authorized.
STARCRAFT CORPORATION
---------------------
Registrant
February 6, 2003 By: /s/ Timothy L. Burke
------------------------------------
Timothy L. Burke
Chief Financial Officer
CERTIFICATION
By signing below, each of the undersigned officers hereby certifies
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that, to his or her knowledge, (i) this report (as
amended) fully complies with the requirements of Section 13 (a) or 15 (d) of the
Securities Exchange Act of 1934 and (ii) the information contained in this
report (as amended) fairly presents, in all material respects, the financial
condition and results of operations of Starcraft Corporation.
Signed this 6th day of February, 2003
/s/ Kelly L. Rose /s/ Timothy L. Burke
- --------------------------------------- ---------------------------------
Kelly L. Rose Timothy L. Burke
Chairman and Chief Executive Officer Chief Financial Officer
CERTIFICATION
I, Kelly L. Rose, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Starcraft 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 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
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.
Signed this 6th day of February, 2003
/s/ Kelly L. Rose
- -------------------------------------
Kelly L. Rose
Chairman and Chief Executive Officer
CERTIFICATION
I, Timothy L. Burke, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Starcraft 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 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
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.
Signed this 6th day of February, 2003
/s/ Timothy L. Burke
- ----------------------------------
Timothy L. Burke
Chief Financial Officer