UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
		OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended SEPTEMBER 30, 2002

o		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 0-11668

INRAD, Inc.

(Exact name of registrant as specified in its charter)

New Jersey		22-2003247
(State or other jurisdiction of incorporation		(I.R.S. Employer
or organization)		Identification Number)

181 Legrand Avenue, Northvale, NJ 07647
(Address of principal executive offices)
(Zip Code)

(201) 767-1910
(Registrant’s telephone number, including area code)

(Former name, former address and formal fiscal year, if changed since last report)

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 ý No o

Common shares of stock outstanding as of September 30, 2002:

5,279,090

INRAD, Inc.

INDEX

Part I. FINANCIAL INFORMATION

	Item 1.	Financial Statements:

		Consolidated Balance Sheets as of September 30, 2002, (unaudited) and December 31, 2001

		Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2002 and 2001 (unaudited)

		Consolidated Statements of Shareholders' Equity for periods ending December 31, 1999 through September 30, 2002

		Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2002 and 2001 (unaudited)

		Notes to Consolidated Financial Statements

	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations

		Liquidity and Capital Resources


Part II. OTHER INFORMATION

	Item 4.	Controls & Procedures

	Item 6.	Exhibits and Reports on Form 8-K


Signatures

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

INRAD, Inc.

Consolidated Balance Sheets

	September 30,			December 31,
	2002			2001*
	Unaudited

Assets
Current assets:
Cash and cash equivalents	$	680,136		$	548,949
Accounts receivable, net	962,850			1,295,394
Inventories	2,185,713			2,356,884
Unbilled contract costs	347,769			391,756
Other current assets	214,610			140,366
Total Current Assets	4,391,078			4,733,349
Plant and equipment,
Plant and equipment at cost	9,064,142			8,754,197
Less: Accumulated depreciation and amortization	(5,880,511		)	(5,499,498		)
Total plant and equipment	3,183,631			3,254,699
Precious Metals	309,565			309,565
Deferred Taxes	100,000			100,000
Other assets	201,080			201,459
Total Assets	$	8,185,354		$	8,599,072

Liabilities and Shareholders’ Equity
Current Liabilities:
Notes Payable — Bank	$	750,000		750,000
Current portion of long term debt	179,348			—
Accounts payable and accrued liabilities	475,012			729,392
Current obligations under capital leases	98,657			87,021
Total current liabilities	1,503,017			1,566,413

Long Term Debt	792,094			—
Capital Lease Obligations	211,750			287,170
Total liabilities	2,506,861			1,853,583

Shareholders’ equity:
10% convertible preferred stock, Series A no par value; 500 shares issued and outstanding respectively	500,000			500,000

10% convertible preferred stock, Series B no par value; 2,100 shares issued and outstanding respectively	2,100,000			2,100,000

Common stock: $.01 par value; 15,000,000 authorized 5,283,690 shares issued at September 30, 2002 and 5,135,653 at December 31, 2001	52,836			51,356
Capital in excess of par value	9,470,676			9,331,194
Accumulated deficit	(6,430,069		)	(5,222,111		)

Less — Common stock in treasury, at cost (4,600 shares respectively)	(14,950		)	(14,950		)
Total Shareholders’ Equity	5,678,493			6,745,489
Total Liabilities & Shareholders’ Equity	$	8,185,354		$	8,599,072

*Derived from Audited Financial Statements

See Notes to Consolidated Financial Statements

INRAD, Inc.

Consolidated Statements of Operations

(Unaudited)

	Three Months Ended September 30						Nine Months Ended September 30
	2002			2001			2002			2001
Revenues:
Product sales	$	1,344,569		$	1,583,298.00		$	4,188,373		$	6,258,281
Contract R & D	0			94,587			62,625			141,965
Total Revenue	1,344,569			1,677,885			4,250,998			6,400,246
Cost and Expenses:
Cost of goods sold	1,104,692			923,982			3,480,233			3,960,789
Contract R & D expenses	2,324			14,140			61,207			74,552
Selling, general & administrative expenses	572,386			652,310			1,616,702			1,888,197
Internal R & D expenses	41,407			40,780			89,423			141,727
Total Cost and Expenses	1,720,809			1,631,212			5,247,565			6,065,265
Operating profit (loss)	(376,240		)	46,673			(996,567		)	334,981
Other income (expense):
Interest expense	(35,808		)	(25,937		)	(99,040		)	(44,519		)
Interest & other income, net	2,992			4,419			8,250			61,806
Net (loss) income before income tax benefit and preferred stock dividends	(409,056		)	25,155			(1,087,357		)	352,268
Income tax benefit	0			0			0			100,000
Net (loss) income	(409,056		)	25,155			(1,087,357		)	452,268
Preferred stock dividends	—			0			(120,600		)	(155,000		)
Net (loss) income applicable to common shareholders	$	(409,056.12	)	$	25,155		$	(1,207,957	)	$	297,268
Net (loss) income per common share - basic and diluted	(0.07		)	0.01			(0.23		)	0.06
Weighted average shares outstanding	5,203,290			4,998,980			5,187,976			4,985,006

See Notes to Consolidated Financial Statements

INRAD, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

						Preferred Stock						Preferred Stock						Capital in
	Common Stock					(Series A)						(Series B)						excess of										Subscription					Treasury
	Shares	Amount				Shares		Amount				Shares		Amount				par value				Deficit						Receivable					Stock

Balance, December 31, 2000	4,957,728	$	49,577			500		$	500,000			2,100		$	2,100,000			$	9,084,898			$		(5,110,745		)		$	(220,000		)		$		(14,950		)
Exercise of Options	29,250	293			—		—				—		—				30,833				—						—					—
Exercise of Warrants	51,675	516			—		—				—		—				56,683				—						—					—
Dividend on Preferred Stock	92,000	920			—		—				—		—				154,080				(155,000				)		—					—
Subscription received	—	—			—		—				—		—				—				—						220,000					—
Contribution	5,000	50			—		—				—		—				4,700				—						—					—
Net income for the year	—	—			—		—				—		—				—				43,634						—					—

Balance, December 31, 2001	5,135,653	$		51,356	500		$			500,000	2,100		$			2,100,000	$			9,331,194	$		(5,222,111		)		$			—		$		(14,950		)
Contribution of Common Stock to 401K Plan	14,037	140															20,222
Dividend on Preferred Stock	134,000	1,340															119,260				(120,601				)
Net (loss) income for the period																					(1,087,357				)
Balance, September 30, 2002	5,283,690	$		52,836	500		$			500,000	2,100		$			2,100,000	$			9,470,676	$		(6,430,069		)		$			—		$		(14,950		)

See notes to consolidated financial statements

INRAD, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

	Nine Months Ended September 30
	2002			2001
Cash flows from operating activities:
Net (loss) income	$	(1,087,357	)	$	452,268
Adjustments to reconcile net (loss) income to cash provided by (used in) operating activities:
Depreciation and amortization	381,013			248,938
401K common stock contribution	20,362			—
Deferred taxes				(100,000		)
Provision for bad debts				(463		)
Changes in assets and liabilities:
Accounts receivable	332,544			117,361
Inventories	171,171			(668,842		)
Unbilled contract costs	43,987			59,115
Other current assets	(74,244		)	(96,570		)
Other assets	379			(2,300		)
Accounts payable and accrued liabilities	(254,381		)	117,358
Other current liabilities	11,636			(342,246		)
Total adjustments	632,467			(667,649		)
Net cash (used in) operating activities	(454,890		)	(215,381		)
Cash flows from investing activities:
Deposits on capital commitments				(100,578		)
Capital expenditures	(309,945		)	(1,720,556		)
Net cash used in investing activities	(309,945		)	(1,821,134		)
Cash flows from financing activities:
Proceeds from exercise of warrants and options				220,000
Proceeds from issuance of preferred stock				88,325
Proceeds from long term debt	1,000,000			750,000
Principal payments of capital lease obligations and long term debt	(103,978		)	(97,666		)
Net cash provided by financing activities	896,022			960,659
Net increase (decrease) in cash and cash equivalents	131,187			(1,075,856		)
Cash and cash equivalents at beginning of period	548,949			2,233,878
Cash and cash equivalents at end of period	$	680,136		$	1,158,022

See notes to consolidated financial statements

INRAD, Inc.

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 1 -SUMMARY OF ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited interim consolidated financial statements of INRAD, Inc. (the “Company”) reflect all adjustments, which are of a normal recurring nature, and disclosures which, in the opinion of management, are necessary for a fair statement of results for the interim periods. It is suggested that these consolidated financial statements be read in conjunction with the audited consolidated financial statements as of December 31, 2001 and 2000 and for the years then ended and notes thereto included in the Company’s report on Form 10-K, filed with the Securities and Exchange Commission.

Inventory Valuation

Inventories are valued on a lower of cost (first-in-first-out basis) or market basis (net realizable value). Work In Process inventory for the period is stated at actual cost, not in excess of estimated realizable value.

Income Taxes

The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement carrying amounts and the tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. A valuation allowance is established when deferred tax assets are not likely to be realized.

Net Income (Loss) Per Share

Basic and diluted net (loss) income per share is computed using the weighted average number of common shares outstanding. The potential dilutive effect of securities, which are common share equivalents, options, warrants, convertible notes and convertible preferred stock and their associated dividends have been excluded from the diluted computation because their effect is antidilutive.

NOTE 2- PROCEEDS FROM ASSET BASED LOAN

In May of 2002 the company received $1,000,000 from its bank collateralized by equipment. The loan is for a three- year period with a five- year amortization. In July 2002 the rate was fixed at 5.61%.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

This Quarterly Report contains forward-looking statements as that term is defined in the federal securities laws. The Company wishes to insure that any forward-looking statements are accompanied by meaningful cautionary statements in order to comply with the terms of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. The events described in the forward-looking statements contained in this Quarterly Report may not occur. Generally these statements relate to business plans or strategies, projected or anticipated benefits or other consequences of our plans or strategies, projected or anticipated benefits of acquisitions to be made by us, projections involving anticipated revenues, earnings, or other aspects of our operating results. The words “may”, “will”, “expect”, “believe”, “anticipate”, “project”, “plan”, “intend”, “estimate”, and “continue”, and their opposites and similar expressions are intended to identify forward-looking statements. We caution you that these statements are not guarantees of future performance or events and are subject to a number of uncertainties, risks, and other influences, many of which are beyond our control, that may influence the accuracy of the statements and the projections upon which the statements are based. Actual results may vary from these forward-looking statements for many reasons, including the following factors: adverse changes in economic or industry conditions in general or in the markets served by the Company and its customers, actions by competitors, and inability to add new customers and/or

maintain customer relationships. The foregoing is not intended to be an exhaustive list of all factors that could cause actual results to differ materially from those expressed in forward-looking statements made by the Company. Investors are encouraged to review the risk factors set forth in the Company’s most recent Form 10-K as filed with the Securities and Exchange Commission in March 2002. Any one or more of these uncertainties, risks, and other influences could materially affect our results of operations and whether forward-looking statements made by us ultimately prove to be accurate. Our actual results, performance and achievements could differ materially from those expressed or implied in these forward-looking statements. We undertake no obligation to publicly update or revise any forward looking statements, whether from new information, future events, or otherwise.

Readers are further cautioned that the Company’s financial results can vary from quarter to quarter, and the financial results for any period may not necessarily be indicative of future results.

The following discussion and analysis should be read in conjunction with the Company’s consolidated financial statements and the notes thereto presented elsewhere herein. The discussion of results should not be construed to imply any conclusion that such results will necessarily continue in the future.

RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the Company’s un-audited consolidated financial statements presented elsewhere herein. The discussion of results should not be construed to imply any conclusion that such results will necessarily continue in the future.

Total Revenues

Total sales for the three months ended September 30, 2002 were $1,345,000 as compared with total sales of $1,678,000 for the same three months in 2001; down 20%. Total sales for the nine months ended September 30, 2002 were $4,251,000 as compared with $6,400,000 for the same period last year; down 34%. The decrease resulted from continued depressed markets in the semiconductor and telecom markets.

Product Sales

Product sales for the third quarter of 2002 were $1,345,000 vs. $1,583,000 for the third quarter of 2001, a decrease of 15%. Sales for the first nine months of FY 2002 totaled $4,188,000 vs. $6,258,000 for the first nine months of 2001, down 33%.

Product sales were 98.5% of total revenues for the first nine months of 2002, reflecting the Company’s strategic refocusing of its resources on product sales vs. R&D services.

Product bookings for the third quarter were $980,000 vs. $1,176,000 for the same period last year, down 17%. Product bookings for the first nine months of the year were $4,267,000 vs. $4,891,000 for the same period in 2001, down 13%.

The book-to-bill ratio for the third quarter of 2002 was 0.73 compared with 0.74 for the same quarter of 2001, indicating similar seasonal slowness and a continuation of the lowered demand experienced for six quarters, especially from custom optics customers in the semiconductor equipment, metrology and instrumentation sectors. The book-to-bill ratio for the first nine months of 2002 was 1.02 vs. 0.78 for the first nine months of 2001, reflecting the result that the decrease in sales (33%) was greater than the decrease in bookings (13%) when contrasting the two nine month periods.

The backlog at September 30, 2002 was down 24% to $1,605,000 as compared to $2,108,000 on September 30, 2001.

Cost of Goods Sold

For the nine-month period ended September 30, 2002, the cost of goods sold as a percentage of product revenues was 83.0% vs. 63.3% for the same period last year. For the full year 2001, the actual cost of good sold percentage was 63.5%. Gross profit margin for the first nine months was 16.9%, compared with 36.7% for the first nine months of 2001.

In dollar terms, the cost of goods sold was $3,480,000 for the first nine months of 2002 compared with $3,967,000 for first nine months of 2001, down 12%. However, product revenues were down 33% year to year for the same period.

The increase in the cost of goods sold percentage in comparison to 2001 was anticipated, resulting from greater decrease in sales volume than decrease in costs. The decreased sales volumes could not be entirely offset by the personnel reductions, salary reductions and other cost cutting measures implemented by management.

Inventory costs for the year were determined from perpetual inventory records, adjusted to net realizable value.

Contract Research and Development

Contract research and development revenues were $63,000 for the nine months ended September 30, 2002, compared to $142,000 for the nine months ended September 30, 2001. Related contract research and development expenditures, including allocated indirect costs, for the nine months ended September 30, 2002 were $61,000 compared to $75,000 for the comparable period in 2001. Revenues for the third quarter were $0 compared to $95,000 in the third quarter of 2001. The Company’s backlog of contract R&D was $28,000 at September 30, 2002, compared with $91,000 at December 31, 2001 and $115,000 at September 30, 2001.

The Company expects to continue to selectively seek new government-sponsored programs from time to time, as well as joint programs with certain of its customers, in technical areas related to its core businesses.

Selling, General and Administrative Expenses

Selling, general and administrative expenses for the current nine-month period were $1,617,000 vs. $1,888,000 for the same period in the prior year, down 14%. Third quarter expenses were $572,000 for the current year vs. $652,000 for the third quarter of FY 2001. The expenses decreased due to cost cutting measures implemented by management including salary and fee reductions for executive personnel, other employees, and Board members, net of the addition of another member of the sales team.

Internal Research and Development Expenses

Research and development expenses for the quarter ended September 30, 2002 were $41,000 compared to $41,000 for the quarter ended September 30, 2001. IR&D expenditures for the first nine months of 2002 were $89,000 compared with $142,000 in the first nine months of 2001.

Federal Deferred Tax Benefit

The Company recognizes deferred tax liabilities and assets for the expected future tax consequences of events that have been recognized in the Company’s financial statements or tax returns. Deferred tax liabilities and assets are determined based on the difference between the financial statement carrying amounts and the tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. At December 31, 2001, the Company had a net deferred tax asset of approximately $2,200,000, the primary component of which was its significant net operating loss carry forward. Through December 31, 2001, the Company had established a valuation allowance of approximately $2,100,000 in the event that the tax asset will not be realized in the future. Management determined in 2001 that future income projections mitigate the need for a full valuation allowance.

Interest expense

Interest expense for the first nine months of the year was $99,000 compared to $45,000 incurred in the first nine months of 2001. The increase resulted from greater utilization of the Company’s credit lines for working capital purposes.

Net (Loss) Income

Net loss for the nine months ended September 30, 2002 was $(1,087,000) compared to net income of $452,000 during the same period in FY 2001. Net (loss) income for the quarters ending September 30 was $(409,000) for FY 2002 and $25,000 for FY 2001.

(Loss) income from operations for the first nine months was $(997,000) in 2002 as compared with $335,000 in 2001. Third quarter operating (loss) profit was $(376,000) in 2002 and $47,000 in 2001.

Earnings Per Share

Basic earnings per share available to common shareholders was calculated by adjusting the net (loss) income by $121,000 in 2002 and by $155,000 in 2001 for the common stock dividend paid on Company preferred stock, divided by the weighted shares outstanding. Diluted earnings per share for the nine months ended September 30, 2002 and September 30, 2001 were not calculated because their effect was anti-dilutive.

LIQUIDITY AND CAPITAL RESOURCES

Capital expenditures, including purchases, deposits, and a portion of applicable internal labor and overhead charges, for the nine months ended September 30, 2002 and September 30, 2001 were $309,000 and $1,821,000, respectively. Capital expenditures for all of 2001 were $2,224,000. The decrease reflects the major progress made during 2001 on the Company’s operational initiatives, including its plant and equipment modernization programs, its manufacturing systems deployment program, and its process re-engineering program. These programs are intended to improve plant capacity, labor productivity, manufacturing cycle time, and gross margins when sales recover to pre-2002 levels. Further capital outlays in 2002 towards these goals are expected to be significantly less than in 2001.

Management will continue to make investments in capital acquisitions, both in equipment and acquisition of complementary businesses, to pursue its objective of growth in shareholder value and to maintain a competitive edge in the markets that it serves. The Company believes that it has the financial resources necessary to implement its capital expenditure needs in 2002. The Company expects to turn to the equity markets to raise the capital it will require to implement its acquisition activities in 2003.

During the nine-month period ended September 30, 2002 the Company’s expenses have exceeded revenues, yielding negative cash flow from operations in the amount of ($455,000) as compared to a negative cash flow from operations in the first nine months of FY2001of ($215,000). Cash outflows during this period have been funded from use of previously established working capital credit lines and proceeds from an asset based loan. Where possible, the Company will seek to increase sales, and reduce expenses and cash requirements to improve future operating results and cash flows. The current quarter yielded positive cash flow from operations in the amount of $33,000. This resulted primarily from losses generated during the period that were offset by reduced working capital requirements.

The Company’s future liquidity is dependent upon its ability to continue to generate adequate cash flow from operations, to finance its working capital needs, and to raise financial capital to fund its capital expansion plans. Management expects that cash flow from operations, available cash, and use of its available lines of credit, will provide adequate liquidity for the Company’s operations in 2002. We can give no guarantee that our efforts will be successful.

PART II. OTHER INFORMATION

ITEM 4. CONTROLS AND PROCEDURES

Within the 90 days prior to the date of this report, the Corporation carried out an evaluation, under the supervision and with the participation of the Corporation’s management, including the Corporation’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Corporation’s disclosure controls and procedures pursuant to Secur ities Exchange Act Rule 13a-14. Based upon that evaluation, the Corporation’s Chief Executive Officer and Chief Financial Officer concluded that the Corporation’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Corporation (including its consolidated subsidiaries) required to be included in the Corporation’s periodic SEC filings. There have been no significant changes in the Corporation’s internal controls or in other factors that could significantly affect internal controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(A) Exhibits:

11. An exhibit showing the computation of per-share earnings is omitted because the computation can be clearly determined from the material contained in this Quarterly Report on Form 10-Q.

(B) Reports on Form 8-K:

None.

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.

	INRAD, Inc.



	By:	/s/ Daniel Lehrfeld
		Daniel Lehrfeld
		President and Chief Executive Officer


	By:	/s/ William S. Miraglia
		William S. Miraglia
		Chief Financial Officer

Date: November 14, 2002

CERTIFICATIONS

I, Daniel Lehrfeld, certify that:

1. I have reviewed this quarterly report on Form 10-Q of INRAD, 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

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: November 14, 2002

		/s/ Daniel Lehrfeld
	Name:	Daniel Lehrfeld
	Title:	President and Chief Executive Officer

CERTIFICATIONS

I, William S. Miraglia, certify that:

1. I have reviewed this quarterly report on Form 10-Q of INRAD, Inc.;

(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;

(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

Date: November 14, 2002

		/s/ William S. Miraglia
	Name:	William S. Miraglia
	Title:	Chief Financial Officer