1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2004
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ____________ to _______________
Commission file number 1-7636
THE CATTLESALE COMPANY
(Exact name of small business as specified in its charter)
Delaware 74-1605174
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
9901 IH10 West, Suite 800
San Antonio, Texas 78230-2292
(Address of principal executive offices)
(210) 558-2898
(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 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___.
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13, or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes X No___
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: 21,360,907
Transitional Small Business Disclosure Format (Check one): Yes ___ No _X__
SEC2334(1-04) Persons who are to respond to the collection of information
contained in this form are not required to respond unless the form displays a
currently valid OMB control number.
THE CATTLESALE COMPANY
AND SUBSIDIARIES
INDEX
Page
Number
Part I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets -
March 31, 2004 and December 31, 2003 3
Consolidated Statements of Operations -
Three Months Ended March 31, 2004 and 2003 4
Consolidated Statements of Cash Flows -
Three Months Ended March 31, 2004 and 2003 5
Notes to Consolidated Financial Statements 6
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
Item 3. Controls and Procedures 12
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K 12
Signature 13
---------
Certifications 14
--------------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
CONSOLIDATED BALANCE SHEETS
The CattleSale Company and Subsidiaries
(In thousands, except share data)
-------------------------------------------------------------------------------------------------------------------
(unaudited)
March. 31, 2004 Dec. 31, 2003
Assets
Current assets:
Cash and cash equivalents $ 5 $ 30
Accounts receivable, net 55 64
Prepaid expenses and other current assets 20 60
-----------------------------------------------------------------------------------------------------------
Total current assets 80 154
Fixed assets, net 97 108
Goodwill 708 708
Other assets, net 132 137
--------------------------------------------------------------------------------------------------------------
Total Assets $ 1,017 $ 1,107
==============================================================================================================
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 366 $ 334
Accrued expenses 352 232
Notes payable 137 109
----------------------------------------------------------------------------------------------------------
Total current liabilities 855 675
Deferred federal income tax -- 400
------------------------------------------------------------------------------------------------------------
Total Liabilities $ 855 $ 1,075
==============================================================================================================
Stockholders' equity:
Series A Preferred stock, $0.01 par value. Shares authorized,
500,000; 250,000 shares issued and outstanding in 2004 and 2003
(liquidation preference $2,500,000) $ 2 $ 2
Series B Preferred stock, $0.01 par value. Shares authorized,
4,000,000; 2,376,044 shares issued and outstanding in 2004
and 2,381,403 in 2003 (liquidation preference $23,760,440) 24 24
Common stock, $0.01 par value. Shares authorized 50,000,000;
shares issued and outstanding 21,360,907 in 2004 and 20,353,700 in 2003. 213 204
Paid in capital 8,094 8,026
Accumulated deficit (8,171) (8,224)
--------------------------------------------------------------------------------------------------------------
Total stockholders' equity $ 162 $ 32
--------------------------------------------------------------------------------------------------------------
Total Liabilities and Stockholders' Equity $ 1,017 $ 1,107
==============================================================================================================
See accompanying Notes to Consolidated Financial Statements.
3
CONSOLIDATED STATEMENTS OF OPERATIONS
The CattleSale Company and Subsidiaries
(Unaudited)
(In thousands, except share data)
Three Months Ended
-------------------------------------------------------------------------------------------------------------------------
Mar. 31, 2004 Mar.31, 2003
(restated)
Revenue:
Service, net ($38 gross billings in 2004 and $97 in 2003) $ 1 $ 2
------------------------------------------------------------------------------------------------------------
Total Revenue 1 2
Operating costs and expenses:
Selling, general and administrative 308 339
--------------------------------------------------------------------------------------------------------------
Total operating costs and expenses 308 339
--------------------------------------------------------------------------------------------------------------
Operating loss (307) (337)
Non-operating income (expense):
Interest income 6 --
Interest expense (54) --
Other, net 8 9
---------------------------------------------------------------------------------------------------------------
Loss before income taxes (347) (328)
Income tax benefit 400 --
---------------------------------------------------------------------------------------------------------------
Net income (loss) $ 53 $ (328)
===============================================================================================================
Preferred stock dividends paid or accumulated (164) (65)
Net loss applicable to common shareholders adjusted
for preferred stock accumulated (111) (393)
===============================================================================================================
Basic and Diluted loss per common share $(.01) $(.03)
===============================================================================================================
Average Common Shares Outstanding:
Basic and Diluted 20,493,203 13,715,402
See accompanying Notes to Consolidated Financial Statements.
4
CONSOLIDATED STATEMENTS OF CASH FLOWS
The CattleSale Company and Subsidiaries
(Unaudited)
(In Thousands)
Three Months Ended
Mar. 31, 2004 Mar. 31, 2003
Cash flows from operating activities:
Net income (loss) $ 53 $ (328)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 11 7
Amortization of debt discount 50 --
Deferred income tax benefit (400) --
Changes in assets and liabilities:
Decrease in prepaids 40 16
Decrease in receivables 9 147
Increase (decrease) in accounts payable and accrued expenses 156 (78)
Other, net 6 4
- -
Net cash used in operating activities $ (75) $ (232)
-------- ----------
Cash flows from investing activities:
Acquisition Costs -- (123)
-- -----
Net cash provided by (used in) investing activities -- (123)
-- -----
Cash flows from financing activities:
Sale of common stock 50 --
-- --
Net cash provided from financing activities 50 --
-- --
Net decrease in cash and cash equivalents (25) (355)
---- -----
Cash and cash equivalents at beginning of period 30 1,236
-- -----
Cash and cash equivalents at end of period $ 5 $ 881
============ ============
Cash payments for:
Interest $ -- $ --
Income taxes $ -- $ --
See accompanying Notes to Consolidated Financial Statements.
The changes in operating assets and liabilities resulting from the acquisition
transaction on February 25, 2003 are not considered in determining net cash
provided from operating activities.
5
THE CATTLESALE COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(In thousands, except per share data)
(Unaudited)
1. Summary of Significant Accounting Policies
Liquidity and Going Concern
The Company will not have sufficient cash resources to satisfy its cash
requirements for 2004, including the payment of certain of its March 31, 2004
obligations, without an infusion of additional cash. In November and December of
2003, the Company received short term financing of $125 to partially fund its
operations. These notes matured in January and February of 2004, and the Company
is currently in default on these notes. In addition, subsequent to year end, an
additional $125 was received as a private placement investment, also to
partially fund its operations. The Company has been primarily operating through
one agent located in the Northwestern region of the United States, who was
primarily responsible for generating most of the cattle transactions in 2003.
The selling season for that region is generally in the summer and fall with
deliveries occurring in the fall and winter. Consequently, subsequent to year
end, the source of cash inflows to the Company has primarily been from the
private investment, which is not sufficient to meet the Company's cash
requirements. The Company has been seeking to expand its agent network to
include more coverage throughout the United States. In addition, the Company is
exploring several opportunities to provide cash infusions from equity and
acquisition transactions. While the Company is simultaneously seeking additional
"bridge" investments to fund its operations until more longer term capital
investments are received, if at all, there can be no assurance that additional
short term and/or longer term financing will be received and that the Company
will be able to fulfill its obligations or continue operations.
On April 9, 2004, the Company, along with co-tenants Canal Capital
Corporation and Plaza Securities Company LP, entered into a settlement agreement
with the landlord of its New York office lease. The settlement agreement
provides for, among other things, termination of the lease in its entirety and
full release of all of the parties. The release was contingent upon the
forfeiture of the Company's and co-tenants' security deposits and the payment of
two months rent. While the Company satisfied its portion of the first month's
rent, the Company's portion of the second month's rent was paid directly by
certain of the Company's directors and will be reimbursed to them from first
monies received by the Company from future cash infusions, if received. The
terms of the original lease provided for lease termination in October, 2009.
Cash and Cash Equivalents
Cash equivalents include short-term, highly-liquid money market accounts or
debt investments with overnight maturities and, as a result, the carrying value
approximates fair value because of the short maturity of those instruments.
Revenue Recognition
Effective February 25, 2003, the Company provides auction trading services
through the internet to producers of beef and dairy cattle. The Company
typically receives a consignment fee from the producer at the time the producer
enters into a listing agreement with the Company. If the listing results in a
sale, this fee is refunded to the seller as a credit to the commission. If no
sale occurs, the Company retains the consignment fee. Commissions are based on a
percentage of the selling price of the cattle, subject to a minimum per head
charge. Commission revenue is recognized upon delivery of the cattle to the
buyer.
6
Commissions, paid by the Company to its regional representatives, typically
60% to 80% of the Company's commission revenue, are recorded as selling costs
when the Company records the related revenue.
The Company generally pays the seller prior to its collection from the
buyer and thereby has credit risk for amounts greatly in excess of its
commission revenue. Although not contractually bound, the Company also may, in
certain circumstances, absorb losses from buyer rejection.
The previous management of the Subsidiaries before their acquisition by the
Company had taken the position that the billings to the sellers should be
reported as the Subsidiaries' revenue, the amounts paid to the sellers reported
as the cost of sales and the net retained by the Subsidiaries reported as gross
profit.
The Company continued previous management's policy in preparing its interim
financial statements for the periods ended March 31, June 30 and September 30,
2003. After review of the Subsidiaries' current method of operations and the
structuring of its transactions, management has concluded that reporting the
Company's net commission as revenue is more appropriate.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
2. Non-operating Income (Expense)
Quarter Ended Quarter Ended
Mar 31, 2004 March 31, 2003
Interest earned $-- $ 1
Imputed interest 6 8
Interest expense (54) --
Other 8 --
===== ===
$(40) $ 9
===== ===
3. Accounts Receivable
The Company has a receivable from Vugate, Inc. ("Vugate"), the buyer of its
videoconferencing business. This receivable consists of a note with a remaining
face amount of $185 that is payable out of certain Vugate cash flows. This note
is carried on the balance sheet at $159, $55 of which is classified as a current
asset, which represents the present value of the estimated payments at a
discount rate of 12.5% per annum. The Company imputed interest income at 12.5%
per annum on the adjusted balance on a prospective basis beginning in the first
quarter of 2002. While the Company currently believes that the receivable is
fully collectible, it is reasonably possible that the note will be collected at
a slower or faster rate than estimated or that a portion of the note will turn
out to be uncollectible.
7
As of March 31, 2004, the Company had a $909 receivable from the Dynacore
Patent Litigation Trust (the "Trust") plus $194 of accrued interest. The
collection of the receivable was solely dependent upon the success or favorable
settlement of the Patent Litigation. In view of the summary judgment granted to
the defendants in the Patent Litigation on February 11, 2003, an allowance for
the full amount of the receivable was recorded as of December 31, 2002. The
trust appealed this ruling and on March 31, 2004, the United States Court of
Appeals for the Federal Circuit rejected the appeal. As a result of the loss of
the appeal, the amounts were written off in the quarter ended March 31, 2004.
The Company had not recorded the accrued interest as income.
Because of the lack of specific payment terms and comparable instruments,
it is not practicable to estimate the fair value of the note receivable from
Vugate except that the comparatively low market interest rates as of March 31,
2004 make it likely that the fair value exceeds the carrying amount.
4. Accrued Expenses
Mar 31, 2004 Dec 31, 2003
------------ ------------
Salaries, commissions,
bonuses and other benefits $182 $81
Acccrued professional fees 156 133
Other 14 18
==== ====
$352 $232
==== ====
5. Commitments and Contingencies
From time to time, the Company is a defendant in lawsuits generally
incidental to its business. The Company is not currently aware of any such suit,
which if decided adversely to the Company, would result in a material liability
in relation to the financial position and results of operations.
As a result of the March 31, 2004 ruling rejecting the appeal of the Patent
Litigation described in Footnote 3, the District Court must rule on the
defendants' motions for taxable costs and attorneys' fees. The Company and the
Trust believe that they acted in good faith in bringing and prosecuting the
Action and that they have valid defenses to and arguments against defendants'
motions. Although the Company and the Trust believe the motions for attorneys'
fees to be without merit, there can be no assurance that the District Court will
rule in favor of the Company and the Trust. The Company and the Trust cannot
predict (i) when the District Court will rule on defendants' motions for
attorneys' fees, (ii) how the District Court will rule on the motion, and (iii)
the amount of any attorneys' fees if awarded by the District Court. However, a
ruling against the Company may have a material adverse effect on the Company.
In addition, the Company was obligated to loan the Trust up to $1 million.
At March 31, 2004, $909 had been advanced. As a result of the rejected appeal,
Trust financial obligations up to the remaining commitment of $91 may be claimed
against the Company.
6. Acquisitions
On March 7, 2004, the Company entered into a letter of intent to acquire
the cattle identification, traceability and data management division of CowTek,
Inc. CowTek, Inc., headquartered in Brule, Nebraska, is the developer of ISO
Memory tag technology with a proprietary distributive database management system
8
for the identification and traceability of individual cattle records. The
acquisition is structured around the issuance of 300,000 shares of CattleSale
Company $10 Convertible Preferred Stock B and 4,000,000 stock options on
CattleSale common stock exercisable between $.25 and $.75 for a combined
exercise price of $2,120,000. The transaction has an expected close date during
the second quarter of 2004 and is contingent on final due diligence, a
definitive purchase agreement and approval of both companies' board of
directors.
A copy of the Letter of Intent was filed as an exhibit on the Company's
Form 8-K dated March 11, 2004 and is incorporated here by reference.
7. Notes Payable
As of March 31, 2004, there were three notes payable outstanding with a
total face amount of $132. All three bear interest at 8% per annum, with
maturities ranging from January 15, 2004 through February 15, 2004. In addition,
a total of 275,000 shares of the Company's common stock were issued in
conjunction with the issuance of these notes. The debt discount on these notes
of $47, including $40 representing proceeds allocated to the stock issued, was
amortized over the maturity life of the notes.
Currently, the Company is in payment default on all of these notes. Two
notes were amended to include default interest of 12% for all unpaid amounts
after the maturity date as well as the issuance of an additional 135,000 shares
of the Company's common stock that were assigned a value of $27 based on the
quoted prices on the day of the amendments.
Because the borrowings had been made recently, as of March 31, 2004 the
estimated fair value of the notes approximates carrying value.
8. Federal Income Taxes
Included in the results for the three month period ended March 31, 2004 is
a one time income tax benefit of $400. The income tax benefit relates to the
reversal of deferred tax liabilities associated with certain foreign
subsidiaries which the Company divested in Fiscal Year 2000 as part of its
reorganization under Chapter 11. The Company has re-evaluated its exposure to
these taxes and does not believe it will incur any future tax liability related
to these former foreign subsidiaries.
9. Subsequent Event
On April 22, 2004, the Company entered into a letter of intent to acquire a
45 percent equity position in IDComm, Inc.("IDComm"). IDComm has proprietary
software for Distributed Database Technology using RF Tags and 2-D Barcode
structures. IDComm has successfully implemented its SmartWare(TM) technology
along with read/write hardware into the cattle industry through CowTek, Inc.,
which CattleSale is negotiating to acquire (see Footnote 6 - Acquisition).
IDComm presently is developing programs targeted at six industries. Two of these
are for maintenance and identification systems using RF Tag technology and one
is targeted for large values used extensively in the power generation and
refinery industry. Large equipment companies, such as farm equipment and
trucking, also have a need for this type of ID and maintenance record keeping
capability. A specific product for the shipping industry is being targeted using
the SmartWare(TM) technology to replace the Bill-Of-Lading paperwork, which will
modernize and streamline the import and export of product worldwide.
9
The proposed acquisition is structured around the issuance of 150,000
shares of The CattleSale Company's $10 Convertible Preferred Stock B and 500,000
stock options of The CattleSale Company's common stock exercisable at $.25. The
proposed transaction has an expected closing date in the second quarter of 2004
and is contingent on final due diligence, a definitive purchase agreement and
approval of both companies' board of directors.
The letter of intent also provides The CattleSale Company with a 5 year
option, beginning 12 months after closing, to purchase an additional 10% of the
common stock of IDComm at fair market value to be defined in the definitive
Purchase Agreement.
A copy of the Letter of Intent was filed as an exhibit on the Company's
Form 8-K dated April 22, 2004 and is incorporated here by reference.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
(for the three months ended March 31, 2004 and 2003) ($ in thousands)
Results of Operations
For the quarter ended March 31, 2004, the Company had revenue of
approximately $1 which consisted of $38 of gross billings to buyers less
payments to sellers of $37. The Company reported an operating loss of
approximately $307 and a net profit of $53. The Company has been primarily
operating through one agent located in the Northwestern region of the United
States, who was primarily responsible for generating most of the cattle
transactions in 2003. The selling season for that region is generally in the
summer and fall with deliveries occurring in the fall and winter. Therefore,
until more agents are enlisted, revenue will be limited to this cyclical selling
season.
Included in the results for the three month period ended March 31, 2004 is
a one time income tax benefit of $400. The income tax benefit relates to the
reversal of deferred tax liabilities associated with certain foreign
subsidiaries which the Company divested in Fiscal Year 2000 as part of its
reorganization under Chapter 11. The Company has re-evaluated its exposure to
these taxes and does not believe it will incur any future tax liability related
to these former foreign subsidiaries.
For the quarter ended March 31, 2003, the Company had revenue of
approximately $2 which consisted of $97 of gross billings to buyers less
payments to sellers of $95. The Company reported an operating loss of
approximately $337 and a net loss of $328.
Financial Condition
During the first three months of 2004, the Company's cash and cash
equivalents decreased approximately $25 as a result of the payment of certain
operating expenses for the first three months of 2004. As of March 31, 2004, the
Company had cash and cash equivalents of approximately $5.
10
The Company will not have sufficient cash resources to satisfy its cash
requirements for 2004, including the payment of its March 31, 2004 obligations,
without an infusion of additional cash. In November and December of 2003, the
Company received short term financing of $125 to partially fund its operations.
These notes matured in January and February of 2004, and the Company is
currently in default on these notes. In addition, subsequent to year end, an
additional $125 was received as a private placement investment, also to
partially fund its operations. The Company has been primarily operating through
one agent located in the Northwestern region of the United States, who was
primarily responsible for generating most of the cattle transactions in 2003.
The selling season for that region is generally in the summer and fall with
deliveries occurring in the fall and winter. Consequently, subsequent to year
end, the source of cash inflows to the Company has primarily been from the
private investment, which is not sufficient to meet the Company's operations
cash requirements. The Company has been seeking to expand its agent network to
include more coverage throughout the United States. In addition, the Company is
exploring several opportunities to provide cash infusions from equity and
acquisition transactions. While the Company is simultaneously seeking additional
"bridge" investments to fund its operations until more longer term capital
investments are received, if at all, there can be no assurance that additional
short term and/or longer term financing will be received and that the Company
will be able to fulfill its obligations or continue operations.
As a result of the March 31, 2004 ruling rejecting the appeal of the Patent
Litigation described in Footnote 3, the District Court must rule on the
defendants' motions for taxable costs and attorneys' fees. The Company and the
Trust believe that they acted in good faith in bringing and prosecuting the
Action and that they have valid defenses to and arguments against defendants'
motions. Although the Company and the Trust believe the motions for attorneys'
fees to be without merit, there can be no assurance that the District Court will
rule in favor of the Company and the Trust. The Company and the Trust cannot
predict (i) when the District Court will rule on defendants' motions for
attorneys' fees, (ii) how the District Court will rule on the motion, and (iii)
the amount of any attorneys' fees if awarded by the District Court. However, a
ruling against the Company may have a material adverse effect on the Company.
In addition, the Company was obligated to loan the Trust up to $1 million.
At March 31, 2004, $909 had been advanced. As a result of the rejected appeal,
Trust financial obligations up to the remaining commitment of $91 may be claimed
against the Company.
Cautionary Statement Regarding Risks and Uncertainties
This Quarterly Report on Form 10-QSB contains "forward-looking statements"
about the business, financial condition and prospects of the Company which are
intended to be covered by the safe harbors created by Section 27A of the
Securities Act of 1993, as amended and Section 21E of the Securities Exchange
Act of 1934. All statements that are not historical facts, including statements
about management's beliefs or expectations, are forward looking statements. When
used in this Quarterly Report on Form 10-Q, the words "believes," "estimates,"
"plans," "expects," "will," "may," "intends" and "anticipates," and similar
expressions as they relate to the Company or its management, are intended to
identify forward-looking statements.
The Company's actual results could differ materially from those indicated
by the forward looking statements because of various risks and uncertainties,
including, without limitation, changes in competition, economic conditions, new
product development, changes in tax and other governmental rules and regulations
applicable to the Company and other risks indicated in the Company's filings
with the Securities and Exchange Commission and normal business uncertainty.
These risks and uncertainties are beyond the ability of the Company to control,
and in many cases, the Company cannot predict the risks and uncertainties that
could cause its actual results to differ materially from those indicated by the
forward-looking statements.
11
While management believes that its assumptions are reasonable at the time
forward looking statements were made, it is impossible to predict the actual
outcome of numerous factors, and, therefore, undue reliance should not be placed
on such statements. Forward looking statements speak only as of the date they
are made and the Company does not undertake the obligation to update such
statements in light of new information or future events that involve inherent
risks and uncertainties.
Item 3. Controls and Procedures
(a) Within the 90 days prior to the date of this report, the Company
carried out an evaluation, under the supervision and with the participation of
the Company's management, including David S. Geiman and Phillip P. Krumb, the
Company's chief executive officer and chief financial officer, respectively, of
the effectiveness of the design and operation of the Company's disclosure
controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that
evaluation, Messrs. Geiman and Krumb concluded that the Company's disclosure
controls and procedures are effective in timely alerting them to material
information relating to the Company (including its consolidated subsidiaries)
required to be included in the Company's periodic filings with the Securities
and Exchange Commission.
(b) There have been no significant changes in the Company's internal
controls or in other factors that could significantly affect the Company's
internal controls subsequent to the date the Company carried out this
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
99.1 Certification of the Chief Executive Officer and Chief Financial
Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.
(b) Reports on Form 8-K filed during the quarter ended March 31, 2004
March 7, 2004 An 8-K was filed announcing the Company's entry into a Letter
of Intent with CowTek, Inc.
April 22, 2004 An 8-K was filed announcing the Company's entry into a
Letter of Intent with IDComm, Inc.
12
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.
THE CATTLESALE COMPANY
(Registrant)
DATE: May 17, 2004 /s/ Philip P. Krumb
-------------------
Phillip P. Krumb
Chief Financial Officer
(Chief Accounting Officer)
13
Exhibit 99.1
CERTIFICATION
I, David S. Geiman, Company, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of The CattleSale
Company;
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: May 17, 2004
/s/ David S. Geiman
Name: David S. Geiman
Title: Chief Executive Officer
14
Exhibit 99.1
CERTIFICATION
I, Phillip P. Krumb, Company, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of The CattleSale
Company;
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: May 17, 2004
/s/ Phillip P. Krumb
Name: Phillip P. Krumb
Title: Chief Financial Officer
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CERTIFICATIONS PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. SECTION 1350)
In connection with the Quarterly Report of The CattleSale Company (the
"Company") on Form 10-QSB for the quarter ended March 31, 2004, as filed with
the Securities and Exchange Commission (the "Report"), David S. Geiman, Chief
Executive Officer of the Company and Phillip P. Krumb, Chief Financial Officer
of the Company, respectively, do each hereby certify, pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350), that to his knowledge:
(1) The Report fully complies with the requirements of section 13 (a) or 15 (d)
of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and result of operations of the Company.
/s/ David S. Geiman
David S. Geiman
Chief Executive Officer
/s/Phillip P. Krumb
Phillip P. Krumb
Chief Financial Officer
(A signed original of this written statement required by Section 906 has been
provided to The CattleSale Company and will be retained by The CattleSale
Company and furnished to the Securities and Exchange Commission or its staff
upon request)
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