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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 QUARTERLY PERIOD ENDED September 30, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 001-15733
SUTTER HOLDING COMPANY, INC.
(Exact name of registrant as specified in its charter)
Delaware 75-3111137
(State or other Jurisdiction of (I.R.S. Employer Identification Number)
Incorporation or Organization)
150 Post Street, Suite 405
San Francisco, California 94108
(Address of principal executive offices including zip code)
(415) 788-1441
(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 of common stock, $.0001 par value, outstanding as of
October 30, 2003 was 339,837.
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements 2
Consolidated Balance Sheets 2
Consolidated Statements of Operations 3
Consolidated Statements of Cash Flows 4
Notes to the Consolidated Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 5
Item 3. Quantitative and Qualitative Disclosures about Market Risk 9
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 9
Signatures 9
Certifications 10
1
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
SUTTER HOLDING COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
As of As of
(in US dollars) September 30, December 31,
------------- ------------
2003 2002
ASSETS
Current Assets
Cash and cash equivalents $89,976 $625,491
Accounts receivable 27,816 8,528
Note Receivable 100,000 100,000
Prepaid expenses - 5,836
Mortgages held for sale 1,595,900 -
---------- ---------
Total Current Assets 1,813,692 739,855
---------- ---------
Noncurrent Assets
Investments, at fair value - 260,347
Investments, at cost 2,409,465 964,198
Property and equipment, net 24,498 1,246
Loan origination fees, net 111,719 98,542
Other Assets 15,416 -
--------- ---------
Total Noncurrent assets 2,561,098 1,324,333
--------- ---------
Goodwill 3,708,567 -
--------- ---------
TOTAL ASSETS $8,083,357 $2,064,188
=========== ===========
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable & accrued expense $231,073 $30,141
Mortgage warehouse line of credit 1,575,649 -
Interest payable 72,909 28,232
Income taxes payable - 800
--------- ---------
Total Current Liabilities 1,879,631 59,173
--------- ---------
Total Long-Term Liabilities 3,813,920 1,008,376
Stockholders' Equity
Common Stock, $0.0001 par value 34 24
Additional Paid-In Capital 4,336,154 3,266,157
Treasury Stock (333,427) (333,427)
Warrants 103,030 103,030
Unrealized Loss on Investments (62,500) (62,500)
Retained Earnings / (Deficit) (1,976,645) (1,976,645)
Net Income 323,160 -
--------- ---------
Total Stockholders' Equity 2,389,806 996,639
--------- ---------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $8,083,357 $2,064,188
=========== ===========
2
SUTTER HOLDING COMPANY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months For the Nine Months
(in US dollars) ended September 30, ended September 30,
-------------------- --------------------
2003 2002 2003 2002
---- ---- ---- ----
Revenues:
Mortgage sales $16,692,309 $0 $56,240,164 $0
Mortgage commissions 324,154 - 933,171 -
Miscellaneous income 39,038 5,219 95,516 75,814
Interest & dividend income 128 255 1,518 887
Realized gains / (losses) - 5,751 699 5,751
---------- ---------- ---------- ----------
Total revenues 17,055,629 11,225 57,271,068 82,452
---------- ---------- ---------- ----------
Cost of Sales
Cost of mortgage sales 16,568,297 - 55,525,488 -
Interest on warehouse line of credit 33,340 - 116,275 -
Miscellaneous loan fees 20,838 - 73,590 -
---------- ---------- ---------- ----------
Total cost of sales 16,622,475 - 55,715,353 -
---------- ---------- ---------- ----------
Gross profit 433,154 11,225 1,555,715 82,452
Expenses:
General & administrative 296,544 39,867 885,350 780,803
Depreciation & amortization(1) 12,468 2,489 37,320 2,738
Interest expense 53,491 14,209 168,151 22,023
Loss from discontinued operations - - - 125,077
Other expenses 43,964 29,603 141,734 147,752
---------- ---------- ---------- ----------
Total expenses 406,467 86,168 1,232,555 1,078,393
---------- ---------- ---------- ----------
Net income / (loss) $26,687 ($74,943) $323,160 ($995,941)
============ ================ ============== ==============
Net income / (loss) per share(2) $0.10 ($0.40) $1.25 ($7.32)
Weighted Average Shares Outstanding 273,341 188,879 259,322 136,132
_________________________________________________________________________
(1) Included in general and administrative expenses for the first quarter of
fiscal 2002.
(2) Basic and diluted.
3
SUTTER HOLDING COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the nine months
(in US dollars) ended September 30,
2003 2002
OPERATING ACTIVITIES
Net income / (loss) $323,160 ($995,941)
Depreciation & amortization 37,320 498
Adjustments to reconcile net income / (loss)
to net cash provided by (used in) operating
activities
Accounts receivable 520 (591,604)
Note Receivable - 8,750
Prepaid expenses 10,526 (5,205)
Mortgages held for sale 2,220,600 -
Accounts payable 150,387 3,831
Accrued expenses (48,350) 622,666
Mortgage warehouse line of credit (2,189,709) -
Income taxes payable (10,476) -
Interest payable 44,677 18,023
---------- ----------
Net cash provided by (used in) operating activities $538,655 ($938,982)
INVESTING ACTIVITIES
Capital expenditures (4,655) (1,994)
Purchases of securities,
subsidiaries & other investments (4,905,065) (1,851,443)
Other (40,000) (105,260)
---------- ----------
Net cash used in investing activities (4,949,720) (1,958,697)
FINANCING ACTIVITIES
Proceeds from issuance of notes payable 3,205,000 1,062,023
Repayment of notes payable (399,456) -
Purchases of stock for treasury - (247,177)
Issuance of stock 1,070,007 898,002
---------- ----------
Net cash provided by financing activities 3,875,551 1,712,848
Net change in cash for the period (535,515) (1,184,831)
Cash, beginning of period 625,491 1,234,573
---------- ----------
Cash, end of period $89,976 $49,742
========== ===========
4
SUTTER HOLDING COMPANY, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
1. Significant Accounting Policies
The interim financial statements have been prepared by Sutter Holding Company,
Inc. ("the Company") pursuant to the rules and regulations of the Securities and
Exchange Commission applicable to quarterly reports on Form 10-Q. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with accounting principals generally accepted in the
United States of America have been condensed or omitted pursuant to such rules
and regulations, although management believes that the disclosures are adequate
to make the information presented not misleading. These interim financial
statements should be read in conjunction with the audited financial statements
and related notes and schedules included in the Company's 2002 Annual Report
filed on Form 10-K and dated December 31, 2002.
The results of operations for any interim period are not necessarily indicative
of the results of operations for the full year. In the Company's opinion, all
adjustments necessary for a fair presentation of these interim statements have
been included and are of a normal and recurring nature.
2. Forward Looking Statements
This Quarterly Report on Form 10-Q contains certain forward-looking statements
and information relating to Sutter Holding Company, Inc., formerly known as
Shochet Holdings, Inc. ("we", "us" or the "Company") that are based on the
beliefs of its management as well as assumptions made by and information
currently available to its management. When used in this Quarterly Report, the
words "anticipate," "believe", estimate", expect", "intend", "plan" and similar
expressions, as they relate to the Company or its management, are intended to
identify forward-looking statements. These statements reflect management's
current view about our proposed business operations are subject to certain
risks, uncertainties and assumptions, including among others: (i) a general
economic downturn; (ii) a general lack of interest in engaging in a transaction
with a public registered company, (iii) federal or state securities laws or
regulations that have an adverse effect on trading in "penny stocks" and other
risks and uncertainties. Should any of these risks of uncertainties materialize,
or should underlying assumptions prove incorrect, actual results may vary
materially from those described in this Quarterly Report as anticipated,
estimated or expected.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
On September 30, 2003, the Company entered into a Stock Purchase Agreement (the
"Agreement") to acquire 100% of Progressive Lending, LLC ("Progressive"), a
private mortgage bank with offices in Scottsdale, Arizona and Spokane,
Washington. Progressive is licensed to do business in six other states,
including California, Colorado, Idaho, Illinois, Montana and Oregon. The Company
expects to consummate this transaction within 60 days of the signing of the
Agreement, subject to certain closing conditions, including regulatory approval
in the states in which Progressive conducts business. Assuming this transaction
is consummated, the addition of Progressive is expected to more than double the
current size of the Company's mortgage banking business. The financial results
of Progressive are not included in the Company's financial statements herein,
and will not be consolidated with the Company's financial statements until the
transaction is consummated.
On September 15, 2003, the Board of Directors adopted a Stock Repurchase Policy
and Program (the "Repurchase Program") for the purchase of its shares of common
stock into treasury. This Repurchase Program will be in effect from the date
adopted through February 29, 2004 (the "Program Period") and permits the use of
up to $175,000 for such purposes to the extent the Company has excess cash after
meeting working capital needs. The Repurchase Program is intended neither to
change the reporting status of the Company, nor to constitute any market making
in the Shares, but is intended solely to permit the Company to make limited
purchases of its common stock when market prices warrant.
On July 18, 2003, we entered into a Securities Exchange Agreement by and between
the Company, Anza Capital, Inc. ("Anza"), and American Residential Funding, Inc.
("AMRES") (the "Agreement"). The purpose of the Agreement is to acquire an
investment in AMRES and Anza to diversify and expand our assets. On July 31,
2003, the closing date under the Agreement, we issued 66,496 shares of our
common stock to AMRES in exchange for 1,000,000 shares of AMRES Series A
Preferred Stock and 1,000,000 warrants to purchase Anza common stock. Anza's
common stock is traded on the over-the-counter bulletin board under the ticker
symbol "AZAC."
5
The quarter ended September 30, 2003 is the third consecutive quarter to contain
operating results from our Easton Mortgage Corporation subsidiary ("Easton")
which the Company acquired effective January 1, 2003. Prior to this acquisition
and as far back as August 2001, the Company had no operating business and had
existed essentially as a public shell. SEC disclosure rules dictate that we
compare comparable periods for financial reporting and analysis purposes. Below
we have attempted to compare the most recently completed fiscal quarter
including Easton's operations with the same period from the prior year. As you
will notice, the financial performance and operating results of the Company
improved dramatically from the third quarter last year to the third quarter this
year. However, a direct period-to-prior year period comparison is difficult, if
not somewhat meaningless, given that the Company owned a profitable operating
business during the most recent quarter and did not own any operating business
during the same quarter last year. Moreover, the Company changed its fiscal year
end from January 31 to December 31 which can add to the difficulty of trying to
compare period-to-prior year period financial performance and operating results.
The Third Quarter ended September 30, 2003 compared to the Third Quarter ended
September 30, 2002
Revenues
Revenues were $17,055,629 for the quarter ended September 30, 2003 compared to
$11,225 for the quarter ended September 30, 2002. This increase was attributable
to the presence of Easton's operating business whereas no operating business was
owned by the Company at any time during the comparable quarter last year.
Revenues from investments and related activities represented less than 1% of all
revenues for the quarter. For the remainder of fiscal 2003, the Company
anticipates that the majority of its near-term revenues will come from its
mortgage banking business.
Cost of Goods Sold
Cost of mortgage sales for the quarter was $16,622,475 compared to zero for the
comparable quarter last year. Again, this significant positive change was due to
the Company's acquisition of Easton which the Company did not own during the
comparable quarter last year.
Gross profit or net revenues, defined as mortgage revenue less mortgage cost of
goods, amounted to $433,154 this quarter compared to the same $11,225 for the
same quarter last year.
Operating Expenses
Total operating expenses were $406,467 for the quarter ended September 30, 2003
compared to $86,167 for the same quarter last year. This increase is due
primarily to the following two factors: (1) expenses for due diligence; and (2)
the presence of Easton which the Company did not own during the comparable
quarter last year.
The following table provides a more detailed breakdown and comparison of
operating expenses for the three months ended September 2003 and 2002,
respectively:
For the Three Months
ended September 30,
-----------------------------
2003 2002
Expenses: ----------- ---------
General & administrative $296,544 $39,867
Depreciation & amortization 12,468 2,489
Interest expense 53,491 14,209
Other expenses 43,964 29,603
---------- ---------
Total expenses $406,467 $86,168
---------- ---------
The increase in general and administrative expense was due to the expensing of
transaction costs associated with the pursuit of three acquisitions, only one of
which was consummated. The increase in depreciation and amortization expenses
was due to the additional amortization of loan origination fees related to
certain long-term liabilities. The increase in interest expense is the result
of long-term debt issued in connection with the Company's acquisition of Easton.
The increase in other expenses is primarily due to additional professional audit
and legal fees incurred in the normal course of operating a public company.
Net Income
The Company reported earnings of $26,687 for the quarter ended September 30,
2003 compared to a loss of $74,943 for the same quarter last year. Earnings for
the current period were bolstered by the Company's mortgage business while the
loss incurred during the same quarter last year was exacerbated by the Company's
lack of any operating business at that time.
No additional meaningful comparisons can be made for the quarter ended September
30, 2003 compared to the quarter ended September 30, 2002.
6
Earnings Per Share
The Company earned $0.10 per basic and diluted share for the quarter ended
September 30, 2003 compared to a loss of $0.40 per basic and diluted share for
the quarter ended September 30, 2002.
The Nine Months ended September 30, 2003 compared to the Nine Months ended
September 30, 2002
Revenues
Revenues were $57,271,068 for the nine months ended September 30, 2003 compared
to $82,452 for the nine months ended September 30, 2002. This increase was
attributable to the presence of Easton's operating business whereas no operating
business was owned by the Company at any time during the comparable period last
year. Revenues from investments and related activities represented less than 1%
of all revenues for the most recent nine month period. For the remainder of
fiscal 2003, the Company anticipates that the majority of its near-term revenues
will come from its mortgage banking business.
Cost of Goods Sold
Cost of mortgage sales for the nine months ended September 30, 2003 was
$55,715,353 compared to zero for the comparable period last year. Again, this
significant positive change was due to the Company's acquisition of Easton which
the Company did not own during the comparable period last year.
Gross profit or net revenues, defined as revenue less mortgage cost of goods,
for the nine month period amounted to $1,555,715 compared to $82,452 for the
same period last year.
Operating Expenses
Total operating expenses were $1,232,555 for the nine months ended September 30,
2003 compared to $1,078,393 for the same period last year. This increase is due
primarily to the difference between the operating expenses of Easton, which the
Company did not own during the comparable period last year, and the complete
lack of operations existing within the Company for the comparable nine month
period last year.
The following table provides a more detailed breakdown and comparison of
operating expenses for the nine months ended September 2003 and 2002,
respectively:
For the Nine Months
ended September 30,
-----------------------------
2003 2002
---------- ---------
Expenses:
General & administrative $885,350 $780,803
Depreciation & amortization 37,320 2,738
Interest expense 168,151 22,023
Loss from discontinued operations - 125,077
Other expenses 141,734 147,752
---------- -----------
Total expenses $1,232,555 $1,078,393
---------- -----------
The increase in general and administrative expense was due to the expensing of
transaction costs associated with the pursuit of three acquisitions, only one of
which was consummated. The increase in depreciation and amortization expenses
was due to the additional amortization of loan origination fees related to
certain long-term liabilities. The increase in interest expense is the result
of long-term debt issued in connection with the Company's acquisition of Easton.
The loss from discontinued operations in 2002, which was incurred during the
first quarter of 2002, was associated with a former business operation which
existed under prior management, and was eliminated prior to current management's
assumption of control. The increase in other expenses is primarily due to
additional professional audit and legal fees incurred in the normal course of
operating a public company.
7
Net Income
The Company reported earnings of $323,160 for the nine months ended September
30, 2003 compared to a loss of $995,941 for the same period last year. Earnings
for the current period were bolstered by the Company's mortgage business while
the loss incurred during the same period last year was exacerbated by the
Company's lack of any operating business at that time.
No additional meaningful comparisons can be made for the nine month period ended
September 30, 2003 compared to the nine month period ended September 30, 2002.
Earnings Per Share
The Company earned $1.25 per basic and diluted share for the nine month period
ended September 30, 2003 compared to a loss of $7.32 per basic and diluted share
for the nine month period ended September 30, 2002.
Weighted Average Common Shares Outstanding
The weighted average number of common shares and common share equivalents
outstanding used in the computation of basic and diluted earnings (and losses)
per common share was 273,341 for the quarter ended September 30, 2003 compared
to 188,879 for the quarter ended September 30, 2002. The Company implemented a
1:20 reverse stock split on June 13, 2002.
Liquidity and Capital Resources
As of September 30, 2003, the Company had cash and cash equivalents in the
amount of $89,976 compared to $625,491 at the beginning of the year, a decrease
in cash and cash equivalents of $535,515. This change in cash is primarily due
to investments. As of September 30, 2003, we had non-current investments, at
cost, in the amount of $2,409,465. In contemplation of a transaction in the
past, we have raised additional cash through short and intermediate term
borrowings at very reasonable rates. Since March 28, 2002, when present
management took over, we have grown through the acquisition of Easton. We have
financed this growth primarily through a balanced combination of cash, stock and
long-term debt issuances, and we anticipate financing potential future growth
and acquisitions (such as that pending with Progressive) in a similar manner.
During the nine months ended September 30, 2003, net cash provided by operating
activities was $538,655 compared to net cash used in operating and discontinued
activities of $938,982 during the nine months ended September 30, 2002. This
increase in cash provided by operating activities was due to the positive cash
flow generated by Easton, the Company's mortgage business subsidiary.
During the nine months ended September 30, 2003, net cash used in investing
activities was $4,949,721 compared to net cash used in investing activities of
$1,958,697 during the nine months ended September 30, 2002. The increase in cash
used in investing activities was due to the Company's acquisition of Easton, and
to the Securities Exchange Agreement entered into with American Residential
Funding, Inc., a subsidiary of Anza Capital, Inc.
During the nine months ended September 30, 2003 net cash provided by financing
activities was $3,875,551 compared to net cash provided by financing activities
of $1,712,848 for the nine months ended September 30, 2002. Cash provided by
financing activities for the period included an increase in net notes payable of
$2,805,544, associated primarily with the acquisition of Easton.
We expect to continue seeking strategic acquisitions where acceptable
consideration consists of a combination of cash, notes and/or common stock, and
believe that we have adequately anticipated any future capital funding needs for
such acquisitions. Further, it is anticipated that the pending acquisition of
Progressive Lending, LLC will contribute to liquidity and capital resources
sufficient to pursue internal growth opportunities.
Certain Factors affecting Sutter's Business and Prospects
There are numerous factors that affect Sutter's businesses and the results of
its operations. These factors include general economic and business conditions;
the level of demand for Sutter's subsidiaries' products and services; the effect
of terrorism or public health issues on the economy generally and on Sutter and
its subsidiaries specifically; the level and intensity of industry competition;
the cost of capital; and Sutter's ability to effectively manage its operating
costs.
8
Item 3. Quantitative and Qualitative Disclosures about Market Risk
As of September 30, 2003, approximately 80% of the Company's total assets were
invested in the mortgage banking industry. The mortgage banking industry is
highly competitive, and most of our competitors have significantly greater
financial resources and significantly greater infrastructure than we do. The
mortgage banking industry is highly cyclical, and we could experience a material
adverse change in our business if the economy continues to perform poorly. The
mortgage banking industry is also highly sensitive to changes in interest rates,
with a high negative correlation between interest rates and the level of
refinancing business. If interest rates increase significantly, we could
experience a material adverse change in our business.
Also as of September 30, 2003, approximately 5% and 9% of the Company's total
assets were invested in the gold mining industry and the natural meat industry,
respectively. Therefore, the Company is currently exposed to risks associated
with the market prices for commodities such as gold, beef, pork, lamb and
certain natural grains comprising livestock feed. The particular risks
associated with the Company's investments in these industries are somewhat
mitigated by the fact that the Company's investments are indirect, and so it has
no direct market exposure to commodity price fluctuations, and, in the case of
the meat industry, by the meat company's own active risk management activities
as part of their normal business operations. At this time, the Company does not
anticipate that its long term future business, or any significant part of its
future assets, will be related to these industries.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
32.1 Certification by Robert E. Dixon as Chief Executive Officer.
32.2 Certification by William G. Knuff, III as Chief Financial Officer.
b. Reports on Form 8-K
On October 2, 2003, a report on Form 8-K was filed with the SEC disclosing that
the Company entered into a Stock Purchase Agreement to acquire 100% of
Progressive Lending, LLC, a private mortgage bank with offices in Scottsdale,
Arizona and Spokane, Washington. This report is incorporated herein by
reference.
On September 18, 2003, a report on Form 8-K was filed with the SEC disclosing
the adoption by the Company of a Share Repurchase Program. This report is
incorporated herein by reference.
On August 6, 2003, a report on Form 8-K was filed with the SEC disclosing an
investment in American Residential Funding, Inc., a subsidiary of Anza Capital,
through a securities exchange agreement. This report is incorporated herein by
reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SUTTER HOLDING COMPANY, INC.
Date: November 3, 2003 By: /s/ ROBERT E. DIXON
Robert E. Dixon
Co-Chairman of the Board and
Co-Chief Executive Officer
and President
Date: November 3, 2003 By: /s/ WILLIAM G. KNUFF, III
William G. Knuff, III
Co-Chairman of the Board and
Co-Chief Executive Officer
and Chief Financial Officer
9
CERTIFICATIONS
I, Robert E. Dixon, certify that:
1. I have reviewed this quarterly report on Form 10-Q of SUTTER
HOLDING COMPANY, 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 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 3, 2003 By: /s/ ROBERT E. DIXON
Robert E. Dixon
Co-Chairman of the Board and
Chief Executive Officer
10
I, William G. Knuff, III, certify that:
1. I have reviewed this quarterly report on Form 10-Q of SUTTER
HOLDING COMPANY, 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 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 3, 2003 By: /s/ WILLIAM G. KNUFF, III
William G. Knuff, III
Co-Chairman of the Board and
Chief Financial Officer
11