UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
|X| Quarterly Report under Section 13 or 15(d) of the Securities Exchange
Act of 1934.
For the quarterly period ended: September 30, 2003
or
|_| Transition Report Pursuance to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
For the transition period from to
Commission File Number: 000-23039
ORALABS HOLDING CORP.
(Exact name of small business issuer as specified in its charter)
Colorado 14-1623047
------------------------------- -----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2901 South Tejon, Englewood, Colorado 80110
-------------------------------------- --------
(Address of principal executive offices) (Zip Code)
(303) 783-9499
-------------------------
(Issuer's telephone number)
---------------------------------------------
(Former name, former address and former fiscal
year, if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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.
|X| Yes |_| No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
Check whether the issuer filed all documents and reports required to be filed by
Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 after the
distribution of securities under a plan confirmed by a court.
|_| Yes |_| No
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of September 30, 2003 Issuer had 9,160,755 shares of common stock, $.001 Par
Value, outstanding. Transitional Small Business Disclosure Format (check one)
|_| Yes |X| No
Table of Contents
-----------------
Part I. Financial Information
Item 1. Financial Statements Page
----
Consolidated Balance Sheets as of September 30, 2003
(Unaudited) And December 31, 2002.................................2
Consolidated Statements of Operations Three Months
And Nine Months Ended September 30, 2003 and 2002
(Unaudited)........................................................3
Consolidated Statement of Stockholders' Equity from
December 31, 2002 Through September 30, 2003 (Unaudited)..........4
Consolidated Statements of Cash Flows, Nine Months Ended
September 30, 2003 and 2002 (Unaudited)..........................5
Notes to Consolidated Financial Statements......................6 - 8
Item 2. Management's Discussion and analysis of Financial Conditions
And Results of Operations..................................9 -11
Item 3. Controls and Procedures.........................................12
Part II. Other Information ..........................................13-15
1
ORALABS HOLDING CORP AND SUBSIDIARIES
Consolidated Balance Sheets
---------------------------
September 30, 2003 December 31, 2002
Unaudited
-------------------------------------------------------------------------------------------------------------------
Assets
Current Assets
Cash and cash equivalents $2,177,486 $2,677,607
Accounts receivable, net of allowance for doubtful accounts
of $271,467 and $359,201 respectively 2,477,920 1,793,037
Inventory 2,413,952 2,003,542
Deferred income taxes 211,124 305,428
Prepaid expenses 109,658 143,068
Deposits 182,417 128,768
---------- ----------
Total Current Assets 7,572,557 7,051,450
Property and equipment at cost, net 1,148,215 1,234,893
Long Term Deferred Taxes 30,273 32,383
---------- ----------
Total Assets 8,751,045 8,318,726
===============================
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable 747,092 407,701
Accrued liabilities 285,001 305,189
Notes Payable-Current 22,874 22,349
Reserve for Returns 501,302 539,118
Income taxes payable 191,088 270,090
---------- ----------
Total current liabilities 1,747,357 1,544,447
Long Term Liabilities
Note Payable 31,756 48,054
--------- ---------
Total long term liabilities 31,756 48,054
Total liabilities 1,779,113 1,592,501
---------- ----------
Commitments and contingencies
Stockholders' equity
Preferred stock, $.001 par value, 1,000,000 shares authorized; none
issued and outstanding
Common stock, $.001 par value; 100,000,000 shares authorized,
9,160,755 issued and outstanding at the end of both periods 9,160 9,160
Additional paid -in capital 1,216,905 1,216,905
Retained Earnings 5,745,867 5,500,160
---------- ----------
Total stockholders' equity 6,971,932 6,726,225
---------- ----------
Total liabilities and stockholders' equity $8,751,045 8,318,726
===============================
---------------------------------------------------------------------------------------------------------------
See Notes to Consolidated Financial Statements
2
ORALABS HOLDING CORP AND SUBSIDIARIES
Consolidated Statements of Operations
Three Months and Nine Months ended September 30, 2003 and September 30, 2002
Unaudited
====================================================================================================
Three Months Ended Nine Months Ended
09/30/03 09/30/02 09/30/03 09/30/02
-----------------------------------------------=====================================================
Revenues:
Product sales $ 2,948,328 $ 3,452,786 $10,663,160 $10,381,963
----------- ----------- ----------- -----------
Total Revenues 2,948,328 3,452,786 10,663,160 10,381,963
----------- ----------- ----------- -----------
Cost of Sales 1,930,949 2,231,573 7,070,861 6,871,820
----------- ----------- ----------- -----------
Gross profit 1,017,379 1,221,213 3,592,299 3,510,143
----------- ----------- ----------- -----------
Operating Expenses:
Engineering 61,262 96,530 185,114 297,042
Selling and marketing costs 265,646 389,025 1,188,470 1,226,018
General and administrative 549,386 469,703 1,742,693 1,402,407
Other 7,578 1,805 22,893 20,567
----------- ----------- ----------- -----------
Total operating expenses 883,872 957,063 3,139,170 2,946,034
----------- ----------- ----------- -----------
Net Operating Income 133,507 264,150 453,129 564,109
Other Income (expense) (65,207) (65,441)
Interest and other income 5,486 17,082 25,455 65,142
----------- ----------- ----------- -----------
Total other income (expense) (59,721) 17,082 (39,986) 65,142
----------- ----------- ----------- -----------
Net income before provision for income taxes 73,786 281,232 413,143 629,251
Provision for income taxes
Current 40,355 73,192 167,436 200,315
----------- ----------- ----------- -----------
Deferred --- --- --- ---
----------- ----------- ----------- -----------
Net Income $ 33,431 $ 208,040 $ 245,707 $ 428,936
=========== =========== =========== ===========
Basic income per common share $ .00 $ .02 $ .03 $ .05
=========== =========== =========== ===========
Weighted average shares outstanding 9,160,755 9,160,755 9,160,755 9,160,755
=========== =========== =========== ===========
Diluted income per share $ .00 $ .02 $ .03 $ .05
=========== =========== =========== ===========
Diluted weighted average shares outstanding 9,160,755 9,160,755 9,160,755 9,198,370
=========== =========== =========== ===========
=====================================================================================================
See Notes to Consolidated Financial Statements
3
ORALABS HOLDING CORP AND SUBSIDIARIES
Consolidated Statement of Stockholders' Equity
For the Nine months ended September 30, 2003
Unaudited
==========================================================================================================================
Addl.
Preferred Stock Common Stock Paid-In Retained
Shares Amount Shares Amount Capital Earnings Total
------------------------------ ---------- ---------- ---------- ----------- ---------- ---------- ----------
Balance at Dec. 31, 2002 9,160,755 $ 9,160 $1,216,905 $5,500,160 $6,726,225
Net Income 245,707 245,707
---------- ---------- ---------- ----------- ---------- ---------- ----------
Balance at September 30,
2003 9,160,755 $ 9,160 $1,216,905 $5,745,867 $6,971,932
==========================================================================================================================
See Notes to Consolidated Financial Statements
4
ORALABS HOLDING CORP AND SUBSIDIARIES
Consolidated Statements of Cash Flow For
the Nine months ended September 30, 2003 and 2002
Unaudited
================================================================================================================
Nine
Months Ended September 30
2003 2002
----------------------------------------------------------------------------------------------------------------
Cash flows from operating activities
------------------------------------
Net Income $ 245,707 $ 428,936
---------- ----------
Adjustments to reconcile net income to net cash
provided by (used in) operating activities
Depreciation 314,106 317,019
Allowance for Doubtful Accounts
216,592
Changes in assets and liabilities:
Other current assets (20,239) 7,346
Accounts receivable (901,475) 272,056
Prepaid taxes 96,414
Inventory (410,409) ( 24,004)
Accounts payable 339,391 (329,032)
Accrued expenses ( 20,189) 83,457
Reserve for returns ( 37,816) ( 32,783)
Income taxes payable ( 79,001) ( 78,047)
---------- ----------
Net cash (used in) provided by operating activities (256,919) 644,948
---------- ----------
Cash from investing activities
Investment in property and equipment (227,427) (231,344)
Deposit
---------- ----------
Net Cash (used in) investing activities (227,427) (231,344)
---------- ----------
Cash flows from financing activities
Payments on Long Term Debt (15,775) ( 4,144)
---------- ----------
Net cash (used in) provided by financing activities (15,775) ( 4,144)
---------- ----------
Net Increase (decrease) in cash and cash equivalents (500,121) 409,460
Cash and cash equivalents, beginning of the period 2,677,607 2,273,838
---------- ----------
Cash and cash equivalents, end of the period $2,177,486 $2,683,298
========== ==========
Supplemental disclosures of cash flow information:
===============================================================================================================
See Notes to Consolidated Financial Statements
5
ORALABS HOLDING CORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
Note 1 - Organization and Summary of Significant Accounting Policies
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. This report should, therefore, be read in
conjunction with the Annual Report on Form 10-KSB for the year ended December
31, 2002 (the "2002 Form 10-KSB") of Oralabs Holding Corp. and Subsidiaries (the
"Company").
The information included in this report is unaudited but reflects all
adjustments which, in the opinion of management, are necessary to a fair
statement of the results of the interim periods covered thereby. All adjustments
are of a normal and recurring nature except as described herein.
Note 2 - Property and Equipment
Property and equipment consisted of the following:
Machinery and equipment:
------------------------
===================================================================
September 30, 2003
-------------------------------------------------------------------
Machinery and equipment $1,960,011
Leasehold Improvements 750,439
----------
2,710,450
----------
Less accumulated depreciation (1,562,235)
----------
$1,148,215
==========
Note 3 - Line-of-Credit
The Company has a line-of-credit agreement with a bank in the amount of
$2,000,000, which expires September 2004. As of September 30, 2003, the Company
had available the entire $2,000,000 unused line-of-credit. The line-of-credit is
collateralized by a first lien on all of the Company's business assets.
Note 4 - Reserve for Returns and Allowances
The Company reserves 2.75% of revenues for returns and allowances of their
product. The reserve is recorded as a reduction of revenues and as a liability
on the balance sheet. The amount recorded as a liability on the balance sheet at
September 30, 2003 and September 30, 2002 is $501,302 and $392,814 respectively.
6
ORALABS HOLDING CORP AND SUBSIDIARIES
Note 5- Earnings Per Share
The following is a reconciliation of the numerators and denominators of the
basic and diluted earnings per share (EPS) computations:
For the Three Months Ended September 30, 2003
======================================================================================================
Income Shares
(Numerator) (Denominator) Per Share Amt
------------------------------------------------------------------------------------------------------
Net Income $ 33,431
Basic EPS
Weighted average beginning shares outstanding 9,160,755
--------- ---------
Income available to stockholders $ 33,431 9,160,755 $ .00
==========
Effect of Dilutive Common Stock Options
Diluted EPS
--------- --------- ----------
Income available to common stockholders
Plus assumed conversions $ 33,431 9,160,755 $ .00
========= ========= ==========
======================================================================================================
For the Three Months Ended September 30, 2002
======================================================================================================
Income Shares
(Numerator) (Denominator)
Per Share Amt
------------------------------------------------------------------------------------------------------
Net Income $ 208,040
Basic EPS
Weighted average beginning shares outstanding 9,160,755
--------- ---------
Income available to stockholders $ 208,040 9,160,755 $ .02
=========
Effect of Dilutive Common Stock Options
Diluted EPS
--------- --------- ---------
Income available to common stockholders
Plus assumed conversions $ 208,040 9,160,755 $ .02
========= ========= =========
7
ORALABS HOLDING CORP AND SUBSIDIARIES
For the Nine Months Ended September 30, 2003
======================================================================================================
Income Shares
(Numerator) (Denominator) Per Share Amt
------------------------------------------------------------------------------------------------------
Net Income $ 245,707
Basic EPS
Weighted average beginning shares outstanding 9,160,755
---------- ---------
Income available to stockholders $ 245,707 9,160,755 $ .03
==========
Effect of Dilutive Common Stock Options
Diluted EPS
---------- --------- ----------
Income available to common stockholders
Plus assumed conversions $ 245,707 9,160,755 $ .03
========== ========= ==========
======================================================================================================
For the Nine Months Ended September 30, 2002
======================================================================================================
Income Shares
(Numerator) (Denominator) Per Share Amt
------------------------------------------------------------------------------------------------------
Net Income $ 428,936
Basic EPS
Weighted average beginning shares outstanding 9,160,755
--------- ---------
Income available to stockholders $ 428,936 9,160,755 $ .05
=========
Effect of Dilutive Common Stock Options 37,615
Diluted EPS
--------- --------- ---------
Income available to common stockholders
Plus assumed conversions $ 428,936 9,198,370 $ .05
========= ========= =========
======================================================================================================
8
ORALABS HOLDING CORP AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
Special Note on Forward-Looking Statements
Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A
of the Securities Act of 1933, as amended, provide a safe harbor for certain
forward-looking statements. This quarterly report contains statements that are
forward-looking. Forward looking statements include those which are not
historical facts, including without limitation statements about management's
expectations for any period beyond the fiscal quarter ended September 30, 2003.
Words such as "expect", "anticipate", "believe", "intend" and "estimate" and
similar expressions are examples of words which identify forward looking
statements. While these statements reflect the Company's beliefs as of the date
of this report, they are subject to assumptions, uncertainties and risks that
could cause actual results to differ materially and adversely from the results
contemplated, forecast or estimated in the forward-looking statements included
in this report. These factors include, but are not necessarily limited to, the
impact of competitive products, the acceptance of new products or product lines
in the marketplace, the Company's ability to manage growth, the availability of
an adequate workforce and changes in market conditions.
Results of Operations. For the three month period ending September 30, 2003 as
compared with the three month period ending September 30, 2002.
Product sales decreased $504,458 or 15%. Please refer to gross profit below for
explanation.
Gross profit decreased $203,834. As a percentage of sales gross profit was 35%
for both periods. Since gross profit percentage was equal the significant impact
to gross profit comes from decreased revenues. One major customer had a
promotional display for this period in year 2002 that they did not repeat in
year 2003, and another major customer deferred a couple of promotional orders
from the third quarter of year 2003 to the fourth quarter of 2003.
Engineering decreased $35,268. The decrease is primarily due to a temporary
reduction in staffing.
Selling and marketing decreased $123,379. The decrease can be attributed to a
reduction in Sales Commissions of approximately $107,000 due to the combination
of reduced revenues and a significant amount of non-commissioned sales by the
President of the Company. Also, Advertising expenses decreased approximately
$42,000.
Other Income/Expense decreased $76,803. This decrease is substantially due to
initial costs associated with the move to a new facility.
Provisions for income taxes decreased $32,837. This decrease is as a result of
reduced net taxable income.
Net income decreased by $174,609 or 84% as explained by the above activities. As
a percentage of sales, net operating income, which excludes Interest, Other
Income and Income taxes, increased from 8% to 5%.
9
Results of Operations. For the nine month period ending September 30, 2003 as
compared with the nine month period ending September 30, 2002.
Product sales increased $281,197 or 3%. Please refer to the Trends section for a
detailed explanation.
Gross profit increased $82,156. As a percentage of sales gross profit was 34%
for both periods. Gross profit percentage was equal and the increase in revenues
is a modest 3%, therefore gross profit for this nine month comparison has not
been materially impacted.
Engineering decreased $111,928. The decrease is primarily due to a temporary
decrease in staffing.
Selling and marketing decreased $37,547. The decrease can be attributed to a
reduction in Sales Commissions due to the combination of reduced revenues and a
significant amount of non-commissioned sales by the President of the Company.
General and administrative expenses increased $340,286. The increase can be
substantially attributed to Salaries and related payroll expenses due in large
part to additional staffing.
Other Income/Expense decreased $105,128. This decrease is substantially due to
initial costs associated with the move to a new facility and to a lesser degree
reduced interest income and royalties.
Net income decreased by $183,229 or 43 % as explained by the above activities.
As a percentage of sales net operating income, which excludes Interest, Other
Income and Income taxes, decreased from 5% to 4%.
Liquidity and Capital Resources. Balance Sheet as of September 30, 2003 compared
to December 31, 2002.
At September 30, 2003, the Company had $2,177,486 of cash and its current ratio
was approximately 4 to 1. The Company believes its current capital resources are
sufficient to fund operations for the next twelve months.
Accounts receivable increased $684,883. There were timing differences which
created increased receivables as of September 30, 2003 compared to December 31,
2002. In addition, approximately $175,000 of the aged receivables is from a
customer, some of whose assets will be purchased by the Company in consideration
for the write-off of the receivables.
Inventory increased $410,410. The Company invested in materials for a lip balm
product primarily sold in specialty stores that is being introduced into mass
retail, and the Company expanded purchasing for anticipated growth in the fourth
quarter.
Prepaid expenses decreased $33,410. The decrease is due primarily to the
expiration of an agreement for advertising which expired during the third
quarter of year 2003 .
Deposits increased $53,649. The Company made additional deposits used to pay for
inventory to be received in the fourth quarter.
10
Accounts payable increased $339,393. This is substantially due to the timing of
invoices and payments to high volume vendors, which had the effect of the
Company holding larger balances at the end of 2002 as compared to the end of
third quarter 2003 on its Trade payables.
Income taxes payable decreased $79,002. This decrease was significantly from tax
payments made in June, 2003 in combination with reduced liability as it relates
to reduced net income before tax.
Retained earnings increased $245,705 as a result of net income.
Trends. Lip balm revenues increased to $8,691,889 in the first nine months of
2003 as compared to $8,195,118 in the first nine months of 2002, or a 6%
increase. Third quarter sales for year 2003 were lower than for the same period
in year 2002. The move into a larger and better equipped facility will be
accomplished in stages and actually enhance growth in the fourth quarter and
beyond. That coupled with increased promotional orders and anticipated success
with replenishment items with designated retail space give cause for optimism of
sustained growth. The Company is in the process of aggressively pursuing
increased business to take advantage of the new facility, but still can not
predict with certainty what growth will take place or if and when it may occur.
Sales of sour drops and breath fresheners were $1,779,035 in the first nine
months of 2003 as compared to $1,852,210 in the first nine months of 2002, or a
4% decrease. Although a new combo pack of sour drops and sour candy produced an
approximately $120,000 in additional revenue in the third quarter of year 2003
it was not significant enough to have a material impact on this category. It is
still too soon to predict the success or failure of this new product. Other
products in this category remain fairly consistent without much change in
revenue anticipated.
The nutritional supplements, on a relatively smaller scale, showed decline in
revenue. Revenues were $466,421 in the first nine months of 2003 as compared to
$434,632 in the first nine months of 2002, or a 7% increase. Fluctuations in
this category from quarter to quarter have not been significant and there is no
major growth or decline expected.
Impact of Inflation. The Company's financial condition has not been affected by
the modest inflation of the recent past. The Company believes that revenues will
not be materially affected by inflation. The Company's lip care and oral care
products are primarily very low retail price points and impulse items. The
nutritional supplements are a small part (approximately 4%) of revenues and
could be negatively impacted by inflation.
11
Item 3. Controls and Procedures
Evaluation of Disclosure Controls and Procedures. As of the end of the period
covered by this report, the Company conducted an evaluation, under the
supervision and with the participation of the principal executive officer and
principal financial officer, of the Company's disclosure controls and procedures
(as defined in Rules 13a-14(c) and 15d-14(c) under the Securities Exchange Act
of 1934 (the "Exchange Act")). Based on this evaluation, The Company did
experience turnover in selected accounting personnel during the quarter coupled
with activities related to moving the corporate facilities during that same time
period. During that period the operation of internal control systems were such
that our system failed to generate accurate financial information on a timely
basis. The major areas affected were inventory and accounts receivable and their
related income statement accounts. Subsequent to September 30, 2003 management
corrected the weaknesses in the operation of our internal control systems and
will continue to monitor them.
12
PART II - OTHER INFORMATION
Item No. 1. Legal Proceedings. The Company is not a party to any material
pending legal proceedings to which either it or its subsidiary is a party or to
which any of its property is subject.
Item No. 2. Changes in Securities. None.
Item No. 3. Defaults Upon Senior Securities. None.
Item No. 4. Submission of Matters to a Vote of Security Holders. None.
Item No. 5. Other Information. Effective September 4, 2003, the Company's
Subsidiary entered into a Lease for office warehouse space. The Landlord is an
affiliate of Gary H. Schlatter. The Company's Subsidiary has been seeking a
larger space in which it could consolidate its operations that are currently
being conducted at two separate facilities. At such time as the Company's
Subsidiary vacates each of the current facilities, which are also leased from
Gary H. Schlatter directly or from an affiliate of his, the Company's Subsidiary
will be relieved of any remaining obligations under those leases. The Company's
Subsidiary is leasing approximately 88,000 rentable square feet in the new
facility, compared to a total number of approximately 40,000 square feet that
was being leased under the two former leases. The Company believes that its
rental rate is comparable to that which would be paid to an unaffiliated party.
The Company expects that the relocation will be completed by the end of February
2004.
Item No. 6. Exhibits and Reports on Form 8-K.
(a) Exhibits required to be filed are listed below: Certain of the following
exhibits are hereby incorporated by reference pursuant to Rule 12(b)-32 as
promulgated under the Securities and Exchange Act of 1934, as amended, from the
reports noted below:
Exhibit
No. Description
------- -----------
4(1) Specimen Certificate for Common Stock
10.1(1) 1997 Stock Plan
10.2(1) 1997 Non-Employee Directors' Option Plan
10.4(1) Form of Stock Option Grant under 1997 Non-Employee Directors'
Option Plan
10.5(i)(2) Business Lease Between the Company's Subsidiary and
Gary Schlatter (September 1, 2000)
10.5(ii)(3) Amended Business Lease Between the Company's Subsidiary
and 2780 South Raritan, LLC effective October 15, 2000.
10.5(iii)(4) Lease between the Company's Subsidiary and 18501 East Plaza Drive,
LLC dated September 4, 2003
10.10(5) Amended and Restated Employment Agreement Between the
Company's Subsidiary and Gary Schlatter dated May 1, 2003.
11 No statement re: computation of per share earnings is
required since such computation can be clearly
determined from the material contained in this Report on Form
10-QSB
31.1(4) Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, by
Gary H Schlatter
13
31.2(4) Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, by
Emile J Jordan
32(4) Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by
Gary H Schlatter and Emile J Jordan
1 Incorporated herein by reference to the Company's Form 10-K filed for
fiscal year 1997.
2 Incorporated herein by reference to the Company's Form 10-QSB filed for the
quarter ended September 30, 2000.
3 Incorporated herein by reference to the Company's Form 10-KSB filed for
fiscal year 2000.
4 Filed herewith.
5. Incorporated herein by reference to the Company's Form 10-QSB filed for the
quarter ended June 30, 2003.
(b) Reports on Form 8-K were filed on August 14, 2003, August 28, 2003 and
September 30, 2003 during the quarter reported upon in this report.
14
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.
ORALABS HOLDING CORP.
By: /s/ Gary H. Schlatter
----------------------------------
Gary H. Schlatter, President
By: /s/ Emile J. Jordan
----------------------------------
Emile J. Jordan, Chief
Financial Officer
Dated November 19, 2003
15
Exhibit Index
Exhibit
No. Description
------- -----------
10.5(iii) Lease between the Company's Subsidiary and 18501 East Plaza Drive,
LLC dated September 4, 2003
31.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, by
Gary H Schlatter
31.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, by
Emile J Jordan
32 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by
Gary H Schlatter and Emile J Jordan
16