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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002
Commission file number 333-87371-01
PETRO HOLDINGS FINANCIAL CORPORATION
(Exact name of the registrant as specified in its charter)
Delaware 74-2922355
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
6080 Surety Dr.
El Paso, Texas 79905
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (915) 779-4711
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
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Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date: As of September 30, 2002,
the number of shares outstanding of the registrant's only class of common stock
was 2,500.
The registrant, Petro Holdings Financial Corporation, meets the condition's
set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore
filing this Form with the reduced disclosure format.
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PART 1. Financial Information
Item 1. Financial Statements
PETRO HOLDINGS FINANCIAL CORPORATION
UNAUDITED BALANCE SHEETS
December 31, September 30,
2001 2002
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Assets
Cash $ 1,000 $ 1,000
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Total assets $ 1,000 $ 1,000
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Stockholder's Equity
Common stock, $.01 par value: 10,000 shares
authorized; 2,500 shares issued and outstanding $ 25 $ 25
Additional paid-in capital 975 975
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Total stockholder's equity $ 1,000 $ 1,000
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See accompanying notes to unaudited balance sheets.
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PETRO HOLDINGS FINANCIAL CORPORATION
NOTES TO UNAUDITED BALANCE SHEETS
(1) Company Formation and Description of Business
Company Formation
Petro Holdings Financial Corporation (the "Company") is a wholly-owned
subsidiary of Petro Stopping Centers Holdings, L.P. ("Holdings") and was
incorporated July 6, 1999 for the sole purpose of serving as a co-issuer with
Holdings in the issuance of 82,707 units each consisting of $1,000 principal
amount at stated maturity of Holdings 15.0% senior discount notes due 2008 ("15%
Notes") and 82,707 exchangeable Petro Warrant Holdings Corporation's warrants
(the "Warrants"). The Supplemental Indenture dated July 23, 1999 ("Indenture")
provides that upon an "exchange event," such as a change in control, public
offering, or bankruptcy filing, the Warrants will be exchanged, for no
additional consideration, for 100% of the common stock of Petro Warrant Holdings
Corporation, whose sole asset currently is approximately 10.0% of the common
limited partnership interests in Holdings. If the Warrants have not been
exchanged by August 1, 2004, Holdings will be obligated to repurchase the
Warrants at fair market value. At the same time the Company co-issued the 15%
Notes and the Warrants, the Company also co-issued with Holdings, notes to
Chartwell Investments, Inc. of approximately $14.8 million in accreted value
($11.2 million net of an imputed market rate of interest discount), without
warrants. The 15% Notes and the notes issued to Chartwell Investments, Inc. are
recorded on the financial statements of Holdings.
(2) Summary of Significant Accounting Policies
Basis of Presentation
The Company has no employees, only nominal assets, has not and will not
conduct any operations and, accordingly, has no statement of operations. The
accompanying unaudited balance sheets have been prepared in accordance with the
instructions to Form 10-Q and, therefore, certain financial information has been
condensed and certain footnote disclosures have been omitted. Such information
and disclosures are normally included in financial statements prepared in
accordance with generally accepted accounting principles.
The unaudited condensed balance sheets should be read in conjunction with
the balance sheets and notes thereto in the Annual Report of Petro Holdings
Financial Corporation on Form 10-K for the year ended December 31, 2001 ("2001
Form 10-K"). Capitalized terms used in this report and not defined herein have
the meaning ascribed to such terms in the 2001 Form 10-K. In the opinion of
management of the Company, the accompanying unaudited balance sheets contain all
adjustments necessary to present fairly the financial position of the Company at
December 31, 2001 and September 30, 2002.
The Company meets the requirements of an Inactive Registrant as defined by
Rule 3-11 of the Securities and Exchange Commission's Regulation S-X (the
"Rule"). The Rule stipulates that if a registrant is inactive, the financial
statements required for purposes of reports pursuant to the Securities Exchange
Act of 1934 may be unaudited.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The Company is inactive and, accordingly, it has no operations
and only minimal assets.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
None
Item 4. Controls and Procedures
As the Company has no employees, only minimal assets and
conducts no operations, it has only rudimentary disclosure controls
and procedures. Based upon an evaluation of these controls and
procedures as of a date within 90 days of the date of this report, our
principal executive officer and principal financial officer concluded
they are effective in light of the nature of the Company and its lack
of operations. There have been no significant changes in our internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our evaluation.
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Incorporated herein by reference is a list of Exhibits
contained in the Exhibit Index on Page 7 of this Quarterly
Report.
(b) Reports on Form 8-K
The Registrant filed no reports on Form 8-K during the quarter
ended September 30, 2002.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
PETRO HOLDINGS FINANCIAL CORPORATION
(Registrant)
Date: November 13, 2002 By: /s/ J.A. Cardwell, Sr.
-----------------------------------------------
J.A. Cardwell, Sr.
President and Director
(On behalf of Registrant and as Registrant's
Principal Executive Officer)
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Certifications
I, J.A. Cardwell, Sr., certify that:
1. I have reviewed this quarterly report on Form 10-Q of Petro Holdings
Financial 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 we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 13, 2002
/s/ J.A. Cardwell, Sr.
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(J.A. Cardwell, Sr.)
President and Director
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Certifications
I, Edward Escudero, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Petro Holdings
Financial 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 we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 13, 2002
/s/ Edward Escudero
- ---------------------
(Edward Escudero)
Treasurer
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EXHIBIT INDEX
Exhibit No. Exhibit Description
3.1 (a) Certificate of Incorporation.
3.2 (a) Bylaws
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(a) Incorporated by reference to Petro Stopping Centers Holdings, L.P.'s and
Petro Holdings Financial Corporation's Registration Statement on Form S-4
(Registration No. 333-87371), filed on September 17, 1999.
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