UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF
1934
FOR THE FISCAL QUARTER ENDED MARCH 31, 1998
Commission File Number 0-8164
MICRO-MEDIA SOLUTIONS, INC.
(Exact name of registrant as specified in charter)
UTAH 87-0280886
State or other jurisdiction of (IRS Employer I.D. No.)
Incorporation or organization
501 Waller St., Austin, Texas 78702
(Address of principal executive offices)
Issuer's telephone number, including area code (512) 476-6925
Securities registered pursuant to section 12(b) of the Act:
Title of each class Name of each exchange on which registered
None N/A
Securities registered pursuant to section 12(g) of the Act:
Title of each class Name of each exchange on which registered
Common Stock, None
Par Value $.10
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 report(s), and (2) has been subject to such
filing requirements for the past 90 days.
(1) Yes ( ) No (X) (2) Yes (X) No ( )
Number of shares of common stock outstanding at June 30, 1998:
10,885,227
Part I: Financial Information Item 1: Financial Statements
Index to Financial Statements
Page
Balance Sheets 3
Statements of Operation 5
Statements of Stockholders' Equity 6
Statements of Cash Flows 7
Notes to Financial Statement 10
MICRO-MEDIA SOLUTIONS, INC.
Consolidated Balance Sheets
ASSETS
June 30 March 31
1998 1998
(unaudited) (audited)
Current Assets
Cash and Cash Equivalents $ 8,084 $ 25,786
Accounts Receivable - Trade 297,738 150,851
Inventory 221,490 285,023
Short-Term investment 1,350,000
Other Receivables - Advances 174,023 86,961
Total Current Assets 2,051,335 1,898,621
Property, Plant and
Equipment (at cost) - Net 940,911 800,831
Total Assets $ 2,992,246 $ 2,699,452
The accompanying notes are an integral part of these financial
statements.
MICRO-MEDIA SOLUTIONS, INC.
Consolidated Balance Sheets
LIABILITIES AND STOCKHOLDERS EQUITY
June 30 March 31
1998 1998
(unaudited) (audited)
Current Liabilities
Accounts Payable - Trade $ 181,202 $ 300,034
Other Accrued Expenses 66,737 153,241
Bank Line of Credit 1,070,000 1,228,966
Current Portion - Long Term Debt 151,267 151,267
Current Portion - Obligation
Under Capital Leases 41,097 41,097
Other notes payable 200,000 200,000
Total Current Liabilities 1,710,303 2,074,605
Long Term Notes
Notes Payable 192,413 367,522
Obligations Under Capital
Leases for Equipment 127,156 149,560
Total Long Term Notes 319,569 517,082
Stockholders Equity
Preferred Stock, 10,000,000 shares
Authorized:
Series B, $5.30 stated value;
490,000 shares authorized,
issued & outstanding 2,597,000 2,597,000
Series C, $10.60 stated value;
99,057 shares authorized,
issued & outstanding 1,050,004 1,050,004
Series D, $10.60 stated value;
198,807 shares authorized,
issued & outstanding 2,107,354
Common Stock at $.10 par value;
Authorized 50,000,000 common shares
10,885,227 and 10,851,261
issued & outstanding 1,086,148 1,085,126
Additional paid-in capital 2,215,490 2,491,459
Accumulated Deficit (8,093,622) (7,115,824)
Total Stockholders Equity 962,374 107,765
TOTAL LIABILITIES AND
STOCKHOLDERS EQUITY $ 2,992,246 $ 2,699,452
The accompanying notes are an integral part of these financial
statements.
MICRO-MEDIA SOLUTIONS, INC.
Consolidated Statements of Operation
(UNAUDITED)
For the Three Months
Ended June 30
1998 1997
Net Revenues $ 601,629 $ 1,229,784
Cost of Goods Sold 542,262 673,075
Gross Margin 59,367 576,709
Selling, General
and Administrative 970,424 580,275
Net Loss $( 911,057) $ ( 3,566)
Basic and diluted
net loss per share $ (0.08) $ (0.01)
Basic and Diluted
weighted average
shares outstanding 10,807,324 10,764,733
The accompanying notes are an integral part of these
financial statements.
MICRO-MEDIA SOLUTIONS, INC. AND SUBSIDIARY
Consolidated Statements of Stockholders' Equity
For the Year Ended March 31, 1998 (Audited), and
For the Three Months Ended June 30, 1998 (Unaudited)
(page 1 of 4)
Preferred Stock
Series B Series C
Shares Amount Shares Amount
Balance
March 31, 1997
Common stock issued:
Interest
Compensation
Preferred
stock dividend
Preferred stock
issued:
Private
Placement 420,000 2,226,000 99,057 1,050,004
Senior Debt 70,000 371,000
Preferred stock
dividend
Stock option for
compensation
Cash received
from stock
Net loss
Balance
March 31, 1998 490,000 $2,597,000 99,057 $1,050,004
Preferred stock
issued:
Private
Placement
Common stock issued:
Preferred
stock dividend
Net loss
Balance
June 30, 1998 490,000 $2,597,000 99,057 $1,050,004
The accompanying notes are an integral part of these
financial Statements.
MICRO-MEDIA SOLUTIONS, INC. AND SUBSIDIARY
Consolidated Statements of Stockholders' Equity
For the Year Ended March 31, 1998 (Audited), and
For the Three Months Ended June 30, 1998 (Unaudited)
(page 2 of 4)
Preferred Stock
Series D
Shares Amount
Balance
March 31, 1997
Common stock issued:
Interest
Compensation
Preferred
stock dividend
Preferred stock
issued:
Private
Placement
Senior Debt
Preferred stock
dividend
Stock option for
compensation
Cash received
from stock
Net loss
Balance
March 31, 1998
Preferred stock
issued:
Private
Placement 198,807 $2,107,354
Common stock issued:
Preferred
stock dividend
Net loss
Balance
June 30, 1998 198,807 $2,107,354
The accompanying notes are an integral part of these
financial Statements.
MICRO-MEDIA SOLUTIONS, INC. AND SUBSIDIARY
Consolidated Statements of Stockholders' Equity
For the Year Ended March 31, 1998 (Audited), and
For the Three Months Ended June 30, 1998 (Unaudited)
(page 3 of 4)
Additional
(Discount on)
Common Stock Paid-In
Shares Amount Capital
Balance
March 31, 1997 10,764,733 1,076,473 (1,046,058)
Common stock issued:
Interest 10,286 1,029 4,114
Compensation 52,500 5,250 46,407
Preferred
stock dividend 23,742 2,374 56,294
Preferred stock
issued:
Private
Placement (688,000)
Senior Debt
Preferred stock
dividend 3,412,502
Stock option for
compensation 193,750
Cash received
from stock 512,449
Net loss
Balance
March 31, 1998 10,851,261 $1,085,126 $2,491,458
Preferred stock
issued:
Private
Placement (341,689)
Common stock issued:
Preferred
stock dividend 10,224 1,022 65,721
Net loss
Balance
June 30, 1998 10,861,485 $1,086,148 $2,215,490
The accompanying notes are an integral part of these
financial Statements.
MICRO-MEDIA SOLUTIONS, INC. AND SUBSIDIARY
Consolidated Statements of Stockholders' Equity
For the Year Ended March 31, 1998 (Audited), and
For the Three Months Ended June 30, 1998 (Unaudited)
(page 4 of 4)
Accumulated
Deficit Total
Balance
March 31, 1997 ( 133,999) (103,584)
Common stock issued:
Interest 5,143
Compensation 51,657
Preferred
stock dividend ( 58,668)
Preferred stock
issued:
Private
Placement 2,588,004
Senior Debt 371,000
Preferred stock
dividend (3,412,502)
Stock option for
compensation 193,750
Cash received
from stock 512,449
Net loss (3,510,653) (3,510,653)
Balance
March 31, 1998 $(7,115,822) $ 107,766
Preferred stock
issued:
Private
Placement 1,765,665
Common stock issued:
Preferred
stock dividend ( 66,743)
Net loss ( 911,057) $( 911,057)
Balance
June 30, 1998 $(8,093,622) $ 962,374
The accompanying notes are an integral part of these
financial statements.
MICRO-MEDIA SOLUTIONS, INC.
Consolidated Statements of Cash Flow
For the Three Months Ended June 30
(UNAUDITED)
1998 1997
Cash Flows from Operating
Activities:
Net Income (Loss) $ ( 911,057) $( 3,566)
Adjustments to reconcile
net loss to net cash,
provided by operating
activities:
Amortization and
Depreciation expense 52,991 29,746
Change in accounts
receivable ( 146,887) ( 320,983)
Change in inventory 63,533 ( 178,618)
Change in account payable( 118,832) 476,489
Change in accrued and
other liabilities ( 86,504) 102,627
Net Cash Provided by (Used by)
Operating Activities (1,146,755) 105,695
Cash Flows from Investment Activities:
Investment in property
& equipment ( 193,071) ( 382,368)
Change in other assets ( 87,062) ( 452,327)
Net Cash Provided by (Used by)
Investing Activities ( 280,133) ( 834,695)
Cash Flows from Financing Activities:
Net change in Line of Credit ( 158,966) 711,090
Increase of long term debt ( 175,109)
Change in capital lease
obligations ( 22,369) -
Proceeds from issuance of
Preferred Stock 1,765,630 -
Net Cash Provided by (Used by)
Financing Activities 1,409,186 711,090
Net Increase (Decrease)
in Cash ( 17,702) ( 17,910)
Cash at Beginning of Period 25,786 47,833
Cash at End of Period $ 8,084 $ 29,923
Supplemental Disclosure:
Cash paid for interest $ 60,276 $ 25,000
The accompanying notes are an integral part of these financial
statements.
MICRO-MEDIA SOLUTIONS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1998
(unaudited)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation:
The accompanying unaudited interim financial statements have
been prepared in accordance with generally accepted accounting
principals and the rules of the Securities and Exchange
Commission (the SEC), and should be read in conjunction with the
audited financial statements and notes thereto contained in the
Company's latest annual Report filed with the SEC on Form 10-KSB.
In the opinion of management, all adjustments consisting of
normal recurring adjustments, necessary for the fair presentation
of financial position and results of operations for the interim
periods presented have been reflected herein. The results of
operation are not necessarily indicative of the results to be
expected for the full year. Notes to the financial statements
which would substantially duplicate the disclosure contained in
the audited financial statements for the year ended March 31,
1998, as reported in the Form 10-KSB have been omitted.
Nature of Business and Organization
MICRO-MEDIA SOLUTIONS, INC.
Micro-Media Solutions, Inc., (formerly Mountain States
Resources Corporation) was organized under the laws of the
state of Utah on April 15, 1969. The operating subsidiary of
MSI was organized in 1993 in Austin, Texas. On June 23,
1997, Mountain States Resources Corporation, a Utah
corporation ("MSRC"), entered into an agreement and plan of
reorganization with the shareholders of Micro-Media
Solutions, Inc., a Texas Corporation whereby the Company
acquired a non-operating company in exchange for common stock
of the Company (the "Combination Agreement"). Pursuant to
the Combination Agreement, MSRC issued 9,310,000 shares of
its Common Stock for all of the outstanding shares of Micro-
Media Solutions, Inc., a Texas corporation. As part of the
reorganization, MSRC changed its name to Micro-Media
Solutions, Inc. on September 29, 1997. The transaction was
accounted for as a recapitalization.
MSI is a technology corporation formed to provide computer
hardware and peripherals, Internet Services, service and
support, maintenance, installation services, Network
Systems Integration, LAN/WAN distribution services, and
related turnkey services to the public and private sectors.
MSI maintains certification as a minority-owned business
enterprise ("MBE") and status as a Historically
Underutilized Business ("HUB"). As such, MSI has been
qualified by a number of City, State and Federal agencies
to provide these services.
MICRO-MEDIA SOLUTIONS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1998
(Continued)
Principles of Consolidation
The consolidated financial statements the years ended March
31, 1998 and 1997, include the accounts and transactions of
MSI and MSI-Texas. All significant inter-company accounts
and transactions have been eliminated in the accompanying
consolidated financial statements. MSI, however, did not
have any material asset or liability accounts or account
balances. With the exception of MSI's equity accounts,
the significant account balances belong to MSI-Texas.
Cash and Cash Equivalents
The Company considers all highly liquid investments purchased
with an original maturity of three months or less to be cash
equivalents.
Loss/Earnings Per Common Share Calculation
The loss/earnings on Common and Common Equivalent shares is
computed on the basis of the weighted average number of Common
shares and Common Equivalent shares outstanding during the
period.
Use of Estimates and Certain Concentrations
Management of the Company has made a number of estimates and
assumptions relating to the valuation and reporting of assets and
liabilities and the disclosure of contingent assets and
liabilities to prepare these consolidated financial statements in
conformity with generally accepted accounting principles.
Although actual results could differ from those estimates,
Management believes its estimates are reasonable. Certain
components, subassemblies and software included in the Company's
computer systems are obtained from sole suppliers or a limited
number of suppliers. The Company relies, to a certain extent,
upon its suppliers' abilities to enhance existing products in a
timely and cost-effective manner, to develop new products to meet
changing customer needs and to respond to emerging standards and
other technological developments in the computer industry.
The Company's reliance on a limited number of suppliers
involves several risks, including the possibility of shortages
and/or increases in costs of components and subassemblies, and
the risk of reduced control over delivery schedules.
The Company has a large number of customers on which it
performs ongoing credit evaluations and generally does not
require collateral from its customers. Historically, the Company
has not experienced significant losses related to receivables
from individual customers or groups of customers in any
particular industry of geographic area.
MICRO-MEDIA SOLUTIONS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1998
(Continued)
NOTE 2. SHORT-TERM BORROWINGS.
The Company has a secured line of credit agreement with
Compass Bank for $1,350,000 secured by two certificates of
deposit aggregating $1,350,000 held in the Company's name by
Compass Bank and payable in monthly installments of interest
only. The balance as of June 30, 1998, was $1,070,000
and the note matures February 5, 1999.
NOTE 3. CAPITAL TRANSACTIONS
During the three months ended June 30, 1998, the Company received
gross proceeds of $2,107,354 from the Private Placement of
198,807 shares of Series D, 6% Cumulative Convertible Non-Voting
Preferred Stock, Stated value $10.60 per share. The Company
issued 9,467 shares of the Series D Preferred Stock as agreed for
payment of commission fees of the Private Placement. Each share
of Preferred D stock is initially convertible into ten shares of
the Company's Common Stock. Total expenses of the Private
Placement including broker fees, commissions, and legal and
accounting expenses totaled $341,741.
NOTE 4. SUBSEQUENT EVENTS
On July 2, 1998, the Company received $708,421 completing the
Private Placement of 80,850 shares of Series D, 6% Cumulative
Convertible Non-Voting Preferred Stock for a purchase price of
10.60 per share. Each share of Preferred C stock is initially
convertible into ten shares of the Company's Common Stock. Total
expense of the Private Placement including broker fees,
commissions, and legal and accounting fees totaled $148,589.
The Company has been notified that holders' of Class A warrants
will convert 420,000 warrants in August 1998. The proceeds from
the conversion of these warrants will approximate $334,000.
NOTE 5. CONTINGENCIES AND LEGAL MATTERS
MSI is engaged in various litigation and has a number of
unresolved claims pending. While the amounts claimed are not
material and the ultimate liability in respect to such litigation
and claims cannot be determined at this time, MSI is of the
opinion that such liability is not to be of material importance
in relation to its accounts.
NOTE 6. GOING CONCERN
As shown in the accompanying consolidated financial statements,
the Company has incurred a net loss in the current quarter of
$911,057. As of that date, the Company's current assets
exceeded its current liabilities by $341,032.
The Company is working to improve its internal
controls through conversion to a new accounting system,
continuing efforts toward efficiency in operations and
development of marketing budgets. Management has
identified and closed substantial contracts in 1999 and
believes it can produce the level of revenue necessary to
return the Company to a positive earnings trend. The
financial statements do not include any adjustments that
might be necessary if the Company is unable to continue as
a going concern.
Part I: Financial Information Item 2: Management's Discussion and
analysis of financial condition and results of operations.
CAUTIONARY STATEMENT REGARDING FACTORS THAT
MAY AFFECT FUTURE RESULTS
The purpose of this discussion is to focus on significant
changes in the financial condition and results of operations
of the Company during the past two years. The discussion and
analysis is intended to supplement and highlight information
contained in the accompanying consolidated financial
statements.
This report may contain forward-looking statements which are
subject to numerous assumptions, risk and uncertainties.
Statements pertaining to future periods are subject to
uncertainty because of the possibility of changes underlying
factors and assumptions. Actual results could differ
materially from those contained in or implied by such
forward-looking statements for a variety of factors
including, but not limited to; significant changes in the
economic conditions from what is currently anticipated;
significant delay in or inability to execute strategic
initiatives designed to grow revenues and/or control
expenses; and significant changes in accounting, tax or
regulatory practices or requirements.
The operating company of MSI was organized in 1993 in Austin,
Texas to provide computer hardware, software programming,
system support, maintenance, media duplication and kitting to
the public and private sectors. MSI maintains certification
as a minority-owned business enterprise and status as a
Historically Underutilized Business. On June 23, 1997, the
shareholders of Micro-Media Solutions, Inc., a Texas
Corporation ("Operating Company"), entered into an agreement
and plan of reorganization with Mountain States Resources
Corporation (now known as Micro-Media Solutions, Inc.),
(MSRC), whereby the Operating Company acquired MSRC in
exchange for the Common Stock of the Operating Company (the
"Combination Agreement"). Pursuant to the Combination
Agreement, MSRC issued 9,310,000 shares of its Common Stock
for all of the outstanding shares of Micro-Media Solutions,
Inc., a Texas corporation (the "Combination"),(the
"Company"). The Combination was accounted for as a
recapitalization.
The Company's sales consist of hardware sales and delivery
of technical services. During the quarter ending June 30,
1997, the sales mix consisted of a significant concentration in
hardware sales with hardware deliveries to one public entity
representing over 50% of the sales for that period. First
quarter fiscal year 1999 reflects a more normal sales mix
although the hardware sales production has decreased somewhat as
a result of the declining hardware profit margins attributable to
the increased competition for the pure hardware sales.
For the quarter ended June 30, 1998 the Company's
total assets were $2,992,246 with liabilities of $2,029,872.
Current liabilities of $1,710,303 represent 83.4% of current
assets of $2,051,335 for a current ratio of 1.20. Improvements
in cash and cash equivalents are a result of collection of
accounts receivable and funds from increases in shareholders
equity. Company liabilities include a cash secured line of credit
that was instituted in 1998 and certain other Company
obligations.
Net shareholders equity as of June 30, 1998 was $962,374. During
the fiscal three months ending June 30, 1998, the Company
partially completed phase III of a private placement of preferred
stock The completion of the funding was on July 2, 1998. Receipt
of these funds enabled the Company to reduce its outstanding debt
and pay delinquent accounts payable. Company expansion will be
funded through additional funds from Phase III of the private
placement, a debt offering and a possible public
offering in 1999.
Revenues for the quarter ended June 30, 1998 of $601,629 reflect
the Company's sales efforts in its markets. Revenues for the
quarter ended June 30, 1998 decreased $628,155 or (49%) from the
$ 1,229,784 recorded in the quarter ended June 30,1997. This
reduction in 1998 occurred as a result of management's attention
being focused on conversion to a publicly traded company,
development of longer term service contracts, expansion of the
technical staff to service the expanded service contracts and
identification of an appropriate source of investment to support the
Company's expansion.These goals have been accomplished and the Company
anticipates an increase in revenue for 1999. Sales efforts for the year
ending March 31, 1999, from larger service contracts are expected
to produce revenue levels that could return the Company to
a more positive earnings trend.
Cost of goods sold for the quarter ended June 30, 1998 declined
$130,813 or 20% from the quarter ended June 30, 1997. Cost of
goods sold for 1998 of $542,262 or 90% of net revenue is
extraordinarily high, Resulting in a gross margin of $59,367 or
10% of revenues for the quarter. The gross margin the quarter
ended June 30, 1997 was $576,709 or 47% of the quarter ended June
30, 1997 revenues. Gross margin percentages experienced in 1997
more closely represent the margins management is working to
attain. Gross margins are expected to improve in 1999.
Selling, General and Administrative Expenses the quarter ended
June 30, 1998 of $970,424 represents 161% of Revenues. The 1998
figure represents an increase over the quarter ended June 30,
1997 of $390,149 or 40%. The majority of the expense increase
represents the increased staff that has been identified to
enable the Company to work on larger service contracts and
accomplish increased marketing of Company products. Staff
additions include service technicians, sales staff,
accounting staff and middle management. The majority of
the remaining increase in expenses is attributable to
training for expansion, marketing cost associated with new
service contracts, and other expenses associated with the
start up of new service contracts.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1998, the Company had a working capital of $341,032
compared to working capital deficit of $175,984 at March 31,
1998. This increase in the Company's working capital was
primarily due to an increase in accounts receivable and a decrease in
short term borrowings and accounts payable.
The Company received a net $1,765,630 in proceeds from outsiders
in the form of a private placement during the three months ended
June 30, 1998. Additional funding of $708,421 was received
through July 2, 1998.
The company has financed its operations primarily through
borrowings. As of June 30, 1998, the Company's sources of
internal financing were limited. It is not expected that internal
sources of liquidity will improve until net cash is provided by
operating activities which is expected in second quarter of
fiscal 1998, and until such time, the company will rely upon
external sources for liquidity.
PART II: Other Information
Item 1: Legal Proceedings
On December 18, 1997, Argus Management, Inc. filed
Plaintiff's Original Petition in the 216th District Court of
Kerr County, Texas. Argus claims the Company and Mr. Jose G.
Chavez, as joint obligors, defaulted on their obligation to
Argus pursuant to two promissory notes for $100,000 each,
both dated June 2, 1997. Argus is seeking a judgment for
$200,000, together with interest on the notes at the rate of
20% per annum from June 2, 1997, through the date the notes
are satisfied. As of June 30, 1998, $65,000 had been
disbursed to third parties in satisfaction of obligations of
Argus Management, Inc. The $65,000 has been recorded in other
receivables in the accompanying financial statements.
On February 6, 1998, the Company filed Plaintiff's Original
Petition in the above-referenced case. The Company asserts
breach of contract, fraud, defamation, usury, and civil
conspiracy claims against Argus Management, Inc. The Company
strongly disagrees with Argus' contentions and denies
liability to Argus under the notes and plans to oppose
vigorously Argus' claims.
A lawsuit was filed by Manpower, Inc. to preserve its claims
for certain delinquent obligations that were reduced to
approximately $38,000. The full amount of the principal and
interest was paid on April 29, 1998, and a Notice of
Dismissal was filed on May 8, 1998.
On January 22, 1998, the Company filed a lawsuit against Bits
Technical Corporation for damages attributable to a breach of
commitment. This matter is still pending.
Item 2: Changes in Securities
From April 22, 1998 to July 2, 1998, the Company completed the
private placement of 279,657 shares of Series D Preferred Stock,
Stated Value $10.60 per share all to "accredited Investors" as
that term is defined in rule 501(a) of Regulation D Promulgated
under the Securities Act of 1933, as amended.
The company is obligated to issue up to 1,500,000 shares of
common stock to employees and consultants.
Item 3: Defaults on Senior Securities
None
Item 4: Submission of matters to a vote of the security holders
None
Item 5: Other Matters
None
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Date____8/14/1998_ By /s/ Jose G Chavez
Jose G. Chavez, President
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of this Registrant and in the capacities and on the
dates indicated.
Signature Capacity Date
/s/ Jose G Chavez 8/14/1998
Jose G. Chavez Chairman of the Board of
Directors and President
/s/ Mitchell Kettrick 8/14/1998
Mitchell Kettrick Vice-President and Director
/s/ Stephen Hoelscher 8/14/1998
Stephen Hoelscher, CPA Controller
/s/ David Hill 8/14/1998
David Hill Chief Financial Officer
/s/ Ernesto Chavarria 8/14/1998
Ernesto Chavarria Director
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