**FORM 10-QSB**

 

**Securities and Exchange Commission**

## **Washington,D. C. 20549**

 

**(Mark One)**

**ý****        QUARTERLYREPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF1934**

 

**For thequarterly period ended June 30, 2005**

 

**OR**

 

**o****        TRANSITIONREPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934**

 

**For thetransition period from             to             .**

 

**Commissionfile number  0-16257**

 

**Pace Medical, Inc.**

(Exact name of small businessissuer as specified in its charter)

 
| **Massachusetts**                | ** ** | **04-2867416**       |
|----------------------------------|------------|----------------------|
| (State or  other jurisdiction of |       | (I.R.S.  Employer    |
| incorporation  or organization)  |       | identification  No.) |

 

**391 Totten Pond Road, Waltham, Massachusetts 02451**

(Address of principal executive offices)

 

**(781) 890-5656**

(Issuer’s telephone number,

including area code)

 

Check whether the issuer (1) filed allreports required to be filed by Section 13 or 15(d) of the ExchangeAct during the past 12 months (or for such shorter period that the registrantwas required to file such reports), and (2) has been subject to suchfiling requirements for the past 90 days.                                    Yes   ý    No   o

 

Indicate the number of shares outstanding ofeach of the issuer’s classes of common equity, as of August 12, 2005.

 

3,354,870 shares of Common Stock, par value$.01 per share

 

Transitional Small Business Disclosureformat:    Yes o  No ý

 

 

----

 

**PART I- FINANCIAL INFORMATION**

 
| **Item 1.** | **Financial Statements.** |                                                 |
|-------------|---------------------------|------------------------------------------------------|
|        |                      |                                                 |
|        | a)                        | Condensed Consolidated Balance Sheets                |   |
|        |                      |                                                 |   |
|        | b)                        | Condensed Consolidated Statements of Operations      |   |
|        |                      |                                                 |   |
|        | c)                        | Condensed Consolidated Statements of Cash Flows      |   |
|        |                      |                                                 |   |
|        | d)                        | Notes to Condensed Consolidated Financial Statements |   |

 

2

----

 

**PACEMEDICAL, INC. AND SUBSIDIARY**

**CONDENSED CONSOLIDATED BALANCE SHEETS**

 
| ** **                                                                   | ** ** | **JUNE 30, 2005** | ** ** | **DECEMBER 31, 2004** | ** ** |
|------------------------------------------------------------------------------|------------|------------------------|------------|----------------------------|------------|
| ** **                                                                   | ** ** | **(Unaudited)**        | ** ** | **(See note below)**       | ** ** |
| ASSETS                                                                       | ** ** | ** **             | ** ** | ** **                 | ** ** |
|                                                                         |       |                   |       |                       |       |
| Current  assets:                                                             |       |                   |       |                       |       |
| Cash and  cash equivalents                                                   |       | $                      | 614,746    |                       | $          | 902,198 |   |
| Accounts  receivable                                                         |       | 419,741                |       | 215,504                    |       |
| Inventories:                                                                 |       |                   |       |                       |       |
| Raw  materials                                                               |       | 280,469                |       | 271,812                    |       |
| Work-in-process                                                              |       | 114,162                |       | 119,876                    |       |
| Finished  goods                                                              |       | 88,013                 |       | 79,707                     |       |
|                                                                         |       | 482,644                |       | 471,395                    |       |
| Other  current assets                                                        |       | 38,088                 |       | 39,309                     |       |
| Total  current assets                                                        |       | 1,555,219              |       | 1,628,406                  |       |
|                                                                         |       |                   |       |                       |       |
| Property and  equipment, net                                                 |       | 11,630                 |       | 18,812                     |       |
| Other assets                                                                 |       | 254,025                |       | 248,626                    |       |
| TOTAL ASSETS                                                                 |       | $                      | 1,820,874  |                       | $          | 1,895,844 |   |
|                                                                         |       |                   |       |                       |       |
| LIABILITIES  AND SHAREHOLDERS’ EQUITY                                   |       |                   |       |                       |       |
|                                                                         |       |                   |       |                       |       |
| Current  liabilities:                                                        |       |                   |       |                       |       |
| Accounts  payable                                                            |       | $                      | 240,665    |                       | $          | 241,779 |   |
| Accrued  expenses                                                            |       | 64,190                 |       | 118,396                    |       |
| Total  current liabilities                                                   |       | 304,855                |       | 360,175                    |       |
|                                                                         |       |                   |       |                       |       |
| Shareholders’  equity:                                                  |       |                   |       |                       |       |
| Common stock, $.01 par value, 5,000,000  shares authorized, 3,400,870 issued |       | 34,009                 |       | 34,009                     |       |
| Additional  paid-in capital                                                  |       | 3,147,151              |       | 3,147,151                  |       |
| Accumulated  other comprehensive income                                      |       | 253,235                |       | 355,011                    |       |
| Accumulated  deficit                                                         |       | (1,886,629             | )          | (1,968,755                 | )          |
|                                                                         |       | 1,547,766              |       | 1,567,416                  |       |
| Less  Treasury Stock, at Cost, 46,000 shares                                 |       | (31,747                | )          | (31,747                    | )          |
| Total  Shareholders’ Equity                                             |       | 1,516,019              |       | 1,535,669                  |       |
|                                                                         |       |                   |       |                       |       |
| TOTAL  LIABILITIES AND SHAREHOLDERS’ EQUITY                             |       | $                      | 1,820,874  |                       | $          | 1,895,844 |   |

 

Note:                             Thebalance sheet at December 31, 2004 has been taken from the auditedfinancial statements at that date.

 

The accompanying notes are anintegral part of these condensed consolidated financial statements.

 

3

----

 

#### **PACE MEDICAL, INC. AND SUBSIDIARY**

## **CONDENSED CONSOLIDATEDSTATEMENTS OF OPERATIONS**

**(Unaudited)**

 
| ** **                     | ** ** | **For the three months   ended June 30** | ** ** | **For the six months   ended June 30** | ** ** |
|--------------------------------|------------|-----------------------------------------------|------------|---------------------------------------------|------------|
| ** **                     | ** ** | **2005**                                      | ** ** | **2004**                                    | ** ** | **2005** | ** ** | **2004** | ** ** |
| ** **                     | ** ** | ** **                                    | ** ** | ** **                                  | ** ** | ** ** | ** ** | ** ** | ** ** |
| Net sales                      |       | $                                             | 441,398    |                                        | $          | 228,161 |   | $ | 915,491 |   | $ | 609,914 |   |
|                           |       |                                          |       |                                        |       |   |   |   |   |
| Cost of  sales                 |       | 170,858                                       |       | 193,055                                     |       | 386,448 |   | 352,075 |   |
|                           |       |                                          |       |                                        |       |   |   |   |   |
|                           |       | 270,540                                       |       | 35,106                                      |       | 529,043 |   | 257,839 |   |
|                           |       |                                          |       |                                        |       |   |   |   |   |
| Operating  expenses            |       | 249,591                                       |       | 211,269                                     |       | 472,762 |   | 401,783 |   |
|                           |       |                                          |       |                                        |       |   |   |   |   |
| Income  (loss) from operations |       | 20,949                                        |       | (176,163                                    | )          | 56,281 |   | (143,944 | ) |
|                           |       |                                          |       |                                        |       |   |   |   |   |
| Other income                   |       | 20,635                                        |       | 2,081                                       |       | 25,845 |   | 8,292 |   |
|                           |       |                                          |       |                                        |       |   |   |   |   |
| Net Income  (loss)             |       | $                                             | 41,584     |                                        | $          | (174,082 | ) | $ | 82,126 |   | $ | (135,652 | ) |
|                           |       |                                          |       |                                        |       |   |   |   |   |
| Net Income  (loss) per share:  |       |                                          |       |                                        |       |   |   |   |   |
|                           |       |                                          |       |                                        |       |   |   |   |   |
| Basic                          |       | $                                             | .01        |                                        | $          | (.05 | ) | $ | .02 |   | $ | (.04 | ) |
|                           |       |                                          |       |                                        |       |   |   |   |   |
| Diluted                        |       | $                                             | 01         |                                        | $          | (.05 | ) | $ | .02 |   | $ | (.04 | ) |

 

The accompanying notes are anintegral part of these condensed consolidated financial statements.

 

4

----

 

#### **PACE MEDICAL, INC. AND SUBSIDIARY**

**CONDENSEDCONSOLIDATED STATEMENTS OF CASH FLOWS**

**(Unaudited)**

 
| ** **                                                                            | ** ** | **SIX MONTHS ENDED** | ** ** |
|---------------------------------------------------------------------------------------|------------|----------------------|------------|
| ** **                                                                            | ** ** | **JUNE 30**     | ** ** |
| ** **                                                                            | ** ** | **2005**             | ** ** | **2004** | ** ** |
| ** **                                                                            | ** ** | ** **           | ** ** | ** ** | ** ** |
| CASH FLOWS  FROM OPERATING ACTIVITIES:                                                |       |                 |       |   |   |
|                                                                                  |       |                 |       |   |   |
| Net income  (loss)                                                                    |       | $                    | 82,126     |   | $ | (135,652 | ) |
| Adjustments  to reconcile net income (loss) to net cash used in operating activities: |       |                 |       |   |   |
| Depreciation  and amortization                                                        |       | 7,182                |       | 1,024 |   |
| Changes in  assets and liabilities, net:                                              |       | (376,760             | )          | (95,440 | ) |
|                                                                                  |       |                 |       |   |   |
| Net cash  used in operating activities                                                |       | (287,452             | )          | (230,068 | ) |
|                                                                                  |       |                 |       |   |   |
| CASH FLOWS  FROM INVESTING ACTIVITIES:                                                |       |                 |       |   |   |
|                                                                                  |       |                 |       |   |   |
| Purchases of  property and equipment                                                  |       | —               |       | 1,450 |   |
|                                                                                  |       |                 |       |   |   |
| CASH FLOWS  FROM FINANCING ACTIVITIES                                                 |       | —               |       | — |   |
|                                                                                  |       |                 |       |   |   |
| NET DECREASE  IN CASH AND CASH EQUIVALENTS                                            |       | (287,452             | )          | (31,518 | ) |
|                                                                                  |       |                 |       |   |   |
| CASH AND  CASH EQUIVALENTS AT BEGINNING OF PERIOD                                     |       | 902,198              |       | 1,060,791 |   |
|                                                                                  |       |                 |       |   |   |
| CASH AND  CASH EQUIVALENTS AT END OF PERIOD                                           |       | $                    | 614,746    |   | $ | 829,273 |   |

 

The accompanying notes are anintegral part of these condensed consolidated financial statements.

 

5

----

 

**PACEMEDICAL, INC. AND SUBSIDIARY**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

 

1.                                       Theaccompanying unaudited consolidated financial statements and these notes havebeen condensed and do not contain all disclosures required by generallyaccepted accounting principles.  Seenotes to audited consolidated financial statements contained in the Company’sannual report.

 

2.                                       Inthe opinion of the Company, the accompanying unaudited condensed financialstatements contain all adjustments, all of which are normal and recurring,necessary to present fairly the financial position of the Company and itssubsidiary as of June 30, 2005 and the results of their operations for thethree and six months ended June 30, 2005 and June 30, 2004 and theircash flows for the six months ended June 30, 2005 and June 30, 2004.

 

3.                                       Theresults of operations for the three and six months ended June 30, 2005 arenot necessarily indicative of the results to be expected for the full year.

 

4.                                       Basicnet income per share is computed by dividing net income by the weighted averagenumber of common shares outstanding during the period.  Diluted net income (loss) per share iscomputed by dividing net income by the weighted average number of common anddilutive common equivalent shares outstanding during the period, except wherethe effect would be anti-dilutive.  Thenumber of dilutive common equivalent shares outstanding during the period hasbeen determined in accordance with the treasury-stock method.  Common equivalent shares consist of commonstock issuable upon the exercise of outstanding options.

 
| ** **                           | ** ** | **Three Months Ended   June 30,** | ** ** | **Six Months Ended   June 30,** | ** ** |
|--------------------------------------|------------|----------------------------------------|------------|--------------------------------------|------------|
| ** **                           | ** ** | **2005**                               | ** ** | **2004**                             | ** ** | **2005** | ** ** | **2004** | ** ** |
| ** **                           | ** ** | ** **                             | ** ** | ** **                           | ** ** | ** ** | ** ** | ** ** | ** ** |
| Net income  (loss)                   |       | $                                      | 41,584     |                                 | $          | (174,082 | ) | $ | 82,126 |   | $ | (135,652 | ) |
|                                 |       |                                   |       |                                 |       |   |   |   |   |
| Weighted-average  shares outstanding |       | 3,354,870                              |       | 3,354,870                            |       | 3,354,870 |   | 3,354,870 |   |
|                                 |       |                                   |       |                                 |       |   |   |   |   |
| Effect of  dilutive securities       |       | 351,727                                |       |                                 |       | 351,727 |   |   |   |
|                                 |       |                                   |       |                                 |       |   |   |   |   |
| Total Shares                         |       | 3,706,597                              |       | 3,354,870                            |       | 3,706,597 |   | 3,354,870 |   |
|                                 |       |                                   |       |                                 |       |   |   |   |   |
| Basic net  income (loss) per share   |       | $                                      | .01        |                                 | $          | (.05 | ) | $ | .02 |   | $ | (.04 | ) |
|                                 |       |                                   |       |                                 |       |   |   |   |   |
| Diluted net  income (loss) per share |       | $                                      | .01        |                                 | $          | (.05 | ) | $ | .02 |   | $ | (.04 | ) |

 

6

----

 

For both thethree and six month periods ended June 30, 2004, options to purchase340,000 common shares were outstanding, but not included in the dilutedweighted average common share calculation as the effect would have beenantidilutive.

 

5.                                       Comprehensiveloss includes net income (loss) and foreign currency translationadjustments.  Comprehensive loss for thethree and six months ended June 30, 2005 and 2004 was as follows:

 
| ** **                       | ** ** | **Three Months Ended   June 30,** | ** ** | **Six Months Ended   June 30,** | ** ** |
|----------------------------------|------------|----------------------------------------|------------|--------------------------------------|------------|
| ** **                       | ** ** | **2005**                               | ** ** | **2004**                             | ** ** | **2005** | ** ** | **2004** | ** ** |
|                             |       |                                   |       |                                 |       |   |   |   |   |
| Net income  (loss)               |       | $                                      | 41,584     |                                 | $          | (174,082 | ) | $ | 82,126 |   | $ | (135,652 | ) |
|                             |       |                                   |       |                                 |       |   |   |   |   |
| Currency  Translation Adjustment |       | (79,351                                | )          | (26,237                              | )          | (101,776 | ) | 19,206 |   |
|                             |       |                                   |       |                                 |       |   |   |   |   |
| Total                            |       | $                                      | (37,767    | )                                    | $          | (200,319 | ) | $ | (19,650 | ) | $ | (116,446 | ) |

 

6.               Stock-BasedCompensation

 

The Company applies Statement of Financial Accounting Standards (“SFAS”)No. 123, *Accounting for Stock-Based Compensation*,as amended by SFAS No. 148, *Accounting for Stock BasedCompensation Transition and Disclosure, an amendment to FASB Statement No. 123*,to its stock compensation arrangements, which requires entities to recognize asexpense over the vesting period the fair value of stock-based awards on thedate of grant or measurement date.  Foremployee stock-based awards, however, SFAS Nos. 123 and 148 allow entities tocontinue to apply the intrinsic value method under the provisions of AccountingPrinciples Board (“APB”) Opinion No. 25 and provide pro forma net earningsdisclosures as if the fair-value-based method defined in SFAS No. 123 hadbeen applied.  The Company has elected toapply the provisions of APB Opinion No. 25 and provide the pro formadisclosures of SFAS Nos. 123 and 148.

 

Had compensation expense for awards under the Company’ s Stock OptionPlans been determined based on the fair value method set forth in SFAS No. 123,the effect on the Company’s net income (loss) and per share amounts would havebeen as follows (in thousands, except per share data):

 

7

----

 
| ** **                                                                               | ** ** | **Three Months Ended   June 30,** | ** ** | **Six Months Ended   June 30,** | ** ** |
|------------------------------------------------------------------------------------------|------------|----------------------------------------|------------|--------------------------------------|------------|
| ** **                                                                               | ** ** | **2005**                               | ** ** | **2004**                             | ** ** | **2005** | ** ** | **2004** | ** ** |
|                                                                                     |       |                                   |       |                                 |       |   |   |   |   |
| Net income  (loss), as reported                                                          |       | $                                      | 41,584     |                                 | $          | (174,082 | ) | $ | 82,126 |   | $ | (135,652 | ) |
|                                                                                     |       |                                   |       |                                 |       |   |   |   |   |
| Less:  Compensation expense for option awards determined under fair value based  method. |       | (27,991                                | )          | 0                                    |       | (55,945 | ) | 0 |   |
|                                                                                     |       |                                   |       |                                 |       |   |   |   |   |
| Pro forma  net income (loss)                                                             |       | $                                      | 13,593     |                                 | $          | (174,082 | ) | $ | 26,181 |   | $ | (135,652 | ) |
|                                                                                     |       |                                   |       |                                 |       |   |   |   |   |
| Net income  (loss) per share:                                                            |       |                                   |       |                                 |       |   |   |   |   |
| As reported—basic  and diluted                                                      |       | $                                      | .01        |                                 | $          | (.05 | ) | $ | .02 |   | $ | (.04 | ) |
| Pro forma—basic  and diluted                                                        |       | $                                      | .00        |                                 | $          | (.05 | ) | $ | .01 |   | $ | (.04 | ) |

 

8

----

 

**Item 2.****                                   Management’sDiscussion and Analysis of Financial Condition and Results of Operations.**

 

**General**

 

The second quarter of2005 represented the second consecutive quarter of positive results for theCompany as measured both by revenues and earnings.  Revenues for the quarter were nearly doublethe prior year level, and the Company achieved net income for the quarter of$41,584, compared to a loss of $(174,082) in the corresponding prior year period.

 

### **Liquidity and Capital Resources**

### ** **

As of June 30, 2005, the Company had cash and cash equivalents of$614,746 and working capital of $1,250,364. The working capital at June 30, 2005 was approximately $17,867 lessthan the amount at December 31, 2004, owing primarily to exchange ratevariations.  The Company’s cash flowshave historically tracked its operating results.

 

Managementbelieves that its working capital should suffice to ensure that its on-goingoperations are financed adequately.  Inthe short term, however, additional equity and or debt financing may be soughtto continue funding research and development, capital equipment, replacementinventories, and to expand the Company’s marketing operations.  The obtaining of additional capital through theissuance of equity securities may result in dilution of existing shareholders’interests.

 

**Results of Operations - Three Months ended June 30,2005 versus Three Months ended June 30, 2004**

 

Net sales in the second quarter of 2005 increased 93% from the sales inthe second quarter of 2004.  This was dueprimarily to improved delivery of key components from our vendors, increasedproduct availability, strong international sales and attending major industrytrade shows.  The 2004 results wereadversely affected by component shortages and the voluntary suspension ofproduction of the Company’s Model 4170 Temporary Pacemaker for a period ofapproximately 5 months.  While theCompany has had success in addressing the component shortages, there can be noassurance that the Company will not encounter component shortages in futurequarters.

 

The Company’s margins in the second quarter were substantially higherthan those seen in 2004 (61% in 2005 compared to 15% in 2004).  This occurred due to the resumption of productionof the Model 4170 following the end of the second quarter in 2004.

 

Operating expenses increased 28% during the three months ended June 30,2005 versus the three months ended June 30, 2004, primarily due to thehiring of additional management personnel. Management anticipates some increase in its operating expendituresduring the balance of 2005.

 

No tax provision was recorded for the three months ended June 30,2005 owing to the Company’s ability to use net operating loss carryforwards inthe United States.

 

Netincome for the quarter was $41,584 or $.01 per share in contrast to a net lossof $(174,082) or $(.05) per share in the second quarter of 2004.

 

9

----

 

**Results of Operations - Six Months ended June 30,2005 versus Six Months ended June 30, 2004**

 

Net sales in the six months ended June 30, 2005 increased 50% fromthe sales in the six months ended June 30, 2004.  This was due primarily to improved deliveryof key components from our vendors, increased product availability, stronginternational sales and attending major industry trade shows.

 

The Company’s margins in the first half of 2005 were higher than thoseseen in 2004 (58% in 2005 compared to 42% in 2004).  This occurred due to a change in productmix.  It should be noted that pricing hasremained firm on all products.

 

Operating expenses increased 18% during the six months ended June 30,2005 compared to the six months ended June 30, 2004, primarily due to thehiring of additional management personnel. Management anticipates some increase in its operating expendituresduring the balance of 2005.

 

Notax provision was recorded for the six months ended June 30, 2005 owing tothe Company’s ability to use net operating loss carryforwards in the UnitedStates.

 

Netincome for the first half of 2005 was $82,126 or $.02 per share in contrast toa net loss of $(135,652) or $(.04) per share in the first half of 2004.

 

**Factors That May Affect Future Results**

 

From time to time, information provided by the Company or statementsmade by its employees may contain “forward-looking” information which involvesrisks and uncertainties.  In particular,statements contained in this report which are not historical facts (includingbut not limited to the Company’s expectations regarding business strategy, newproduct availability, pricing, anticipated operating results, market share, therate at which backlogs of orders can be filled, operating expenses andanticipated working capital) may be “forward-looking” statements.  The Company’s actual results may differ fromthose stated in any forward-looking statements. Factors that may cause such differences include, but are not limited to,risks associated with the introduction of new products including supplierperformance, risks associated with the manufacture of existing products,including supplier performance, development of markets for new products andexisting products offered by the Company, personnel requirements, the Company’srelationships with distributors and OEM’s, the economic health of such OEM’s,government regulation, competition and general economic conditions.

 

**Item 3. Controls and Procedures**

 

Asof the end of the period covered by this report, our President and ChiefExecutive Officer and our Treasurer performed an evaluation of theeffectiveness of the design and operation of the Company’s disclosure controlsand procedures pursuant to Exchange Act Rule 13a-14.  Based upon that evaluation, the President andChief Executive Officer and the Treasurer concluded 

 

10

----

 

thatthe Company’s disclosure controls and procedures are effective in ensuring thereporting of material information required to be included in the Company’speriodic filings with the Securities and Exchange Commission.  There were no significant changes in theCompany’s internal controls over financial reporting or in other factors thatcould significantly affect these internal controls over financial reportingsubsequent to the date of the most recent evaluation.

 

**PART II- OTHER INFORMATION**

 

**Item 4.****           Exhibits**

 

Exhibits:

 
| 31.1   |   | Certification of the President and Chief  Executive Officer pursuant to Rules 13a -14 and 15d -14  promulgated under the Securities Exchange Act of 1934, as amended, as adopted  pursuant to section 302 of the Sarbanes-Oxley Act of 2002. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                   |
| 31.2   |   | Certification of the Treasurer pursuant to Rules 13a  -14 and 15d -14 promulgated under the Securities Exchange Act of  1934, as amended, as adopted pursuant to section 302 of the Sarbanes-Oxley  Act of 2002.                             |
|   |   |                                                                                                                                                                                                                                                   |
| 32     |   | Certifications pursuant to 18 U.S.C. Section 1350,  as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                    |

 

11

----

 

**SIGNATURES**

 

Pursuant to the requirements of the SecuritiesExchange Act of 1934, the registrant has duly caused this report to be signedon its behalf by the undersigned thereunto duly authorized.

 
| ** ** | ** **                       | **PACE MEDICAL, INC.**            |
|------------|----------------------------------|-----------------------------------|
|       |                             | (Registrant)                      |
|       |                             |                              |   |
|       |                             |                              |   |
| Date:      |   August 12, 2005 |                              | /s/ Steven E. Hanson |   |
|       |                             | Steven E. Hanson, President       |   |
|       |                             |  and Chief Executive Officer |   |
|            |                                  |                                   |  |  |

 

12

----

 

PACE MEDICAL, INC.

FORM 10-QSB

June 30, 2005

EXHIBIT INDEX

 
| **Exhibit No.** | ** ** | **Description**                                                                                                                                                                                                                                              |
|----------------------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** **           | ** ** | ** **                                                                                                                                                                                                                                                   |
| 31.1                 |       | Certification  of President and Chief Executive Officer pursuant to Rules 13a –14 and  15d –14 promulgated under the Securities Exchange Act of 1934, as amended, as  adopted pursuant to section 302 of the Sarbanes-Oxley Act of 2002. |
|                 |       |                                                                                                                                                                                                                                                         |
| 31.2                 |       | Certification  of Treasurer pursuant to Rules 13a –14 and 15d –14 promulgated under the  Securities Exchange Act of 1934, as amended, as adopted pursuant to section 302  of the Sarbanes-Oxley Act of 2002.                             |
|                 |       |                                                                                                                                                                                                                                                         |
| 32                   |       | Certifications  pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906  of the Sarbanes-Oxley Act of 2002                                                                                                                          |

 

----