<PAGE>

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   FORM 10-KSB

(Mark One)
 X  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
---
1934
 (FEE REQUIRED)
For the fiscal year ended December 31, 2002
                          -----------------

    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
(NO FEE REQUIRED)
For the transition period from _____________  to ______________

                   Commission file number  04863
                                           -----

         SOUTHERN INVESTORS SERVICE COMPANY, INC.
-------------------------------------------------
  (Name of small business issuer in its charter)

       Delaware                                              74-1223691
--------------------------------------------------------------------------------
(State or other jurisdiction of incorporation             (I.R.S. Employer
or organization)                                         Identification No.) ___

2727 North Loop West, Suite 200, Houston, Texas             77008
--------------------------------------------------------------------------------
(Address of principal executive offices)                      (Zip Code)

Issuer's telephone number (713) 869-7800

Securities registered under Section 12(b) of the Exchange Act:
  Title of each class              Name of each exchange on which registered
   None
--------------------------------------------------------------------------------

Securities registered under Section 12(g) of the Exchange Act:
                                             Common Stock $1.00 Par Value
--------------------------------------------------------------------------------
(Title of Class)

  Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes  X    No
                                                              ---

  Check if no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is contained in this form, and no disclosure will be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB  X
                              ---

  State issuer's revenues for its most recent fiscal year.  $65,000
                                                            -------

  State the aggregate market value of the voting and non-voting common equity
held by non-affiliates computed by reference to the price at which the stock was
sold, or the average bid and asked prices of such common equity stock, as of a
specified date within the past 60 days. (See definition of affiliate in Rule
12b-2 of the Exchange Act). $0.00 as of March 26, 2003.
                            --------------------------

  State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date.
3,168,929 shares, Common Stock $1.00 par value per share as of March 26, 2003
-----------------------------------------------------------------------------

_________  DOCUMENTS INCORPORATED BY REFERENCE

  Information contained in the Company's proxy statement to be used in
connection with the 2003 annual meeting of shareholders is incorporated by
reference into Part III.

Transitional Small Business Format (check one) Yes ____  No       X
                                                               ----

<PAGE>

                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

     Southern Investors Service Company, Inc., (the Company), was incorporated
under the laws of the State of Delaware in 1972. Prior to 1990, the Company was
engaged in the ownership and development of real estate primarily in the
Houston, Texas area. The operations of the Company were significantly reduced
during 1990, as a result of various debt settlements with lenders and other
creditors. These settlements resulted in the transfer of substantially all of
the Company's holdings to its creditors. The Company's operations since 1990
have been limited to attempts to settle or restructure the Company's remaining
liabilities. The Company's operations also included the management of
residential developments and two office buildings owned by others. During 1998,
the majority of these residential projects were sold by the owners and therefore
the Company no longer is managing these projects. Effective January 1, 1999, the
Company ceased all management activity and all employees related to this
activity were terminated.

     The Company determined in late 1999 that the sale of Lajitas (a resort
property in west Texas), its sole remaining operating asset, would facilitate
the Company's ability to settle its existing liabilities most favorably. As a
result, the Company retained the National Auction Group, Inc., (National
Auction) to conduct an auction of Lajitas. The auction was conducted on February
24, 2000 and the property was sold for $3,950,000. The sale of the Lajitas
property closed on May 2, 2000. During 2000, the Company realized a gain on the
sale of Lajitas of $755,000 and received net cash proceeds of approximately $2.4
million, after the payment of a mortgage note related to the property sold. See
also Notes 1, 5 and 7 of the Notes to Financial Statements of the Company.

Continued Operations and Ongoing Concern Matters

     The Company has attempted to use the net proceeds from the sale of Lajitas
to settle or restructure existing debt, of which approximately $4,850,000 (plus
accrued interest) has matured and is currently past due, and to realize the
carrying amount of its remaining assets. On March 26, 2002, the Board of
Directors of the Company determined that the best alternative to settle the
Company's existing debt was to file a voluntary petition for relief under
Chapter 11 of Title 11 of the United States Bankruptcy Code (Chapter 11) with
the United States Bankruptcy Court (Bankruptcy Court). The Company currently
anticipates that it will file its voluntary petition during 2003 and that any
plan of liquidation submitted to the Bankruptcy Court in connection therewith
will call for the disposition of the Company's remaining assets and the
distribution of all the net proceeds therefrom to the Company's creditors. The
financial statements have been prepared using the historical cost basis of
accounting. Management of the Company believes the historical cost basis of
accounting states assets at approximately their liquidation values and states
the Company's liabilities at their historical amounts. It is not presently
determinable what amounts the creditors will agree to accept in settlement of
the obligations due them. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty. Accordingly,
the Company believes that the equity of the Company has, and will continue to
have, no value and that any Chapter 11 plan confirmed by the Bankruptcy Court
will result in the elimination of the equity interests of all of the Company's
stockholders. The Company anticipates that it will take approximately nine
months to complete its liquidation process; however, any and all Chapter 11
plans that may be proposed will be subject to obtaining all necessary approvals,
including but not limited to creditor votes and judicial determinations of
confirmability. There can be no assurance, therefore, as to how long it may take
to complete the Company's liquidation process.

<PAGE>

Interest in Real Estate Joint Ventures

     The Company has a 5.8% partnership interest in a ten-story office
building located at 2707 North Loop West in Houston, Texas. The Company also has
a 5% cash flow interest in a seven-story office building located at 2727 North
Loop West, in Houston, Texas, where its corporate headquarters are located.

Employees

     The Company had no paid employees as of December 31, 2002. The
Company's management is conducted pursuant to an oral management agreement with
a company affiliated with the Chairman of the Board and Chief Executive Officer.
The management agreement provides the Company accounting and other
administrative services and related office facilities and supplies in exchange
for a management fee paid by the Company in the amount of $1,000 per month.

ITEM 2. DESCRIPTION OF PROPERTY

     The Company's principal executive offices are located in northwest Houston
and rent and other expenses are included in the management fee paid by the
Company pursuant to the oral management agreement discussed above. The Company
also has a 5% cash flow interest in a seven-story office building located at
2727 North Loop West, in Houston, Texas, where its corporate headquarters are
located. In addition, the Company has a 5.8% partnership interest in a ten-story
office building located at 2707 North Loop West, in Houston, Texas. The Company
has planned no significant additions to its properties for 2003.

ITEM 3. LEGAL PROCEEDINGS

     The information with respect to legal proceedings is contained in Note 6 of
the Notes to Financial Statements of the Company. The Company currently has no
outstanding legal proceedings.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were submitted to a vote of security holders during the quarter
ended December 31, 2002.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     The Company's common stock is not quoted on the National Association of
Securities Dealers Automated Quotation (NASDAQ) system. According to National
Quotation Bureau, Incorporated, the last reported price of the Company's common
stock was $.0625 on June 18, 1993. There were no prices quoted after that date.

     The approximate number of holders of record of the Company's stock as of
March 26, 2002 was 502. No dividends have been paid by the Company since its
inception and the Company has no plans to pay dividends in the foreseeable
future.

<PAGE>

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

     This report contains "forward looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements other than
statements of historical fact included in this section and elsewhere in this
report are forward looking statements and, although the Company believes that
the expectations reflected in such forward looking statements are reasonable, it
can give no assurance that such expectations will prove to have been correct.
The Company's business and financial results are subject to various risks and
uncertainties, including the Company's ability to settle or restructure its
remaining debt and other obligations and to generate positive cash flow to cover
its operating expenses, that may cause actual results to differ materially from
the Company's expectations. The Company does not intend to provide updated
information other than as otherwise required by applicable law. All subsequent
written and oral forward looking statements attributable to the Company or
persons acting on its behalf are expressly qualified in their entirety by the
cautionary statements contained in this paragraph and elsewhere in this report.

Current Business Conditions, Operations, Certain Events and Uncertainties

     The Company has attempted to use the net proceeds from the sale of Lajitas
to settle or restructure existing debt, of which approximately $4,850,000 (plus
accrued interest) has matured and is currently past due, and to realize the
carrying amount of its remaining assets. On March 26, 2002, the Board of
Directors of the Company determined that the best alternative to settle the
Company's existing debt was to file a voluntary petition for relief under
Chapter 11 with the Bankruptcy Court. The Company currently anticipates that it
will file its voluntary petition during 2003 and that any plan of liquidation
submitted to the Bankruptcy Court in connection therewith will call for the
disposition of the Company's remaining assets and the distribution of all the
net proceeds therefrom to the Company creditors. The financial statements have
been prepared using the historical cost basis of accounting. Management of the
Company believes the historical cost basis of accounting states assets at
approximately their liquidation values and states the Company's liabilities at
their historical amounts. It is not presently determinable what amounts the
creditors will agree to accept in settlement of the obligations due them. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty. Accordingly, the Company believes that the equity
of the Company has, and will continue to have, no value and that any Chapter 11
plan confirmed by the Bankruptcy Court will result in the elimination of the
equity interests of all of the Company's stockholders. The Company anticipates
that it will take approximately nine months to complete its liquidation process;
however, any and all Chapter 11 plans that may be proposed will be subject to
obtaining all necessary approvals, including but not limited to creditor votes
and judicial determinations of confirmability. There can be no assurance,
therefore, as to how long it may take to complete the Company's liquidation
process.

Results of Operations

  The Company reported a net loss of ($328,000) for 2002 compared with a net
loss of ($327,000) in 2001.

  Revenues primarily include the recognition of previously deferred gross
profits from the sale of real estate.

  The decrease in interest income is primarily due to the lower interest rates
during 2002.

<PAGE>

Liquidity and Capital Resources

         As of December 31, 2002, the Company was delinquent on notes payable
and other long-term debt of approximately $4,850,000 and interest payments of
$3,065,000. As of December 31, 2002, the Company had recorded accounts payable
and accrued expenses (including interest) and other liabilities of $3.1 million.
Due to the sale of Lajitas, the Company has sufficient funds to pay its current
general and administrative operating expenses; however, the Company is unable to
repay its notes payable at the face amounts and the related accrued interest.

         In assessing the Company's liquidity, the impact of income taxes has
been considered. The Company does not expect its cash flow to be affected by
income taxes in the foreseeable future because of its net operating loss carry
forward. The Company's federal income taxes are disclosed in Note 4 of the Notes
to Financial Statements of the Company.

         The impact of inflation on the Company over the past several years has
not been material.

         No major additions to property, plant and equipment are currently
anticipated.

ITEM 7. FINANCIAL STATEMENTS

     The following financial statement data required pursuant to this item are
included herein:

         Report of Independent Public Accountants

         Report of Former Independent Public Accountants

         Balance Sheet - December 31, 2002

         Statements of Loss for each of the Years Ended December 31, 2002 and
          2001

         Statements of Changes in Stockholders' Deficit for each of the Years
          Ended December 31, 2002 and 2001

         Statements of Cash Flows for each of the Years Ended December 31, 2002
          and 2001

         Notes to Financial Statements

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
        AND FINANCIAL DISCLOSURE

         As previously reported in its Current Report on Form 8-K dated August
26, 2002, on August 12, 2002, the Company dismissed Arthur Andersen LLP
("Andersen") as the Company's independent auditor, upon the unanimous
recommendation of the Company's Audit Committee and the unanimous approval of
its Board of Directors.

         Andersen's audit report on the consolidated financial statements of the
Company and its subsidiaries for the year ended December 31, 2001 contained the
following paragraphs reporting that substantial doubt existed as to the
Company's ability to continue as a going concern:

<PAGE>

                     The Company's cash flow from operations has not been
         adequate to meet the Company's obligations for the past several years.
         As of December 31, 2001, the Company had sold substantially all of its
         operating assets and continues to have a deficit in stockholders'
         equity. As described in Note 1 to the financial statements, even though
         the Company has restructured certain indebtedness in the last several
         years and sold substantially all of its operating assets, it continues
         to be delinquent on $4,831,000 of debt. These factors raise substantial
         doubt about the Company's ability to continue as a going concern. Also
         as described in Note 1 to the financial statements, on March 26, 2002,
         the Board of Directors of the Company determined that the best
         alternative to settle the Company's existing debt was to file a
         voluntary petition for relief under the bankruptcy laws. The Company
         currently anticipates filing a plan of liquidation during 2002.

                     The accompanying financial statements have been prepared
         using the historical cost basis of accounting. Management of the
         Company believes the historical cost basis of accounting states assets
         at approximately their liquidation values and states the Company's
         liabilities at their historical amounts. It is not presently
         determinable what amounts the creditors will agree to accept in
         settlement of the obligations due them. The accompanying financial
         statements do not include any adjustments that might result from the
         outcome of this uncertainty.

         Andersen's audit report on the consolidated financial statements of the
Company and its subsidiaries for the year ended December 31, 2000 contained the
following paragraph reporting that substantial doubt existed as to the Company's
ability to continue as a going concern:

                     The Company's cash flow from operations has not been
         adequate to meet the Company's obligations for the past several years.
         As of December 31, 2000, the Company had sold substantially all of its
         operating assets and still has a deficit in stockholders' equity. As
         described in Note 1 to the Consolidated Financial Statements, even
         though the Company has restructured certain indebtedness in the last
         several years, and sold substantially all of its operating assets, it
         continues to be delinquent on $4,811,000 of debt. There can be no
         assurance the Company will be able to settle or restructure its debts
         and obligations with its existing assets or realize the carrying amount
         of its remaining noncash assets. These factors raise substantial doubt
         about the Company's ability to continue as a going concern and to
         realize the carrying amount of its assets. Management is currently
         reviewing options in regard to these matters as described in Note 1 to
         the Consolidated Financial Statements. There can be no assurance that
         actual events will occur in accordance with any of the options
         management is currently reviewing. The accompanying Consolidated
         Financial Statements have been prepared assuming the Company will
         continue as a going concern and do not include any adjustments, which
         could be significant, relating to the recoverability of asset carrying
         amounts or the amount and classification of liabilities that might be
         necessary if the Company is unable to continue as a going concern.

         Other than as set forth above, Andersen's audit reports on the
Company's financial statements for the fiscal years ended December 31, 2001 and
December 31, 2000 did not contain an adverse opinion or disclaimer of opinion,
and were not modified as to uncertainty, audit scope, or accounting principles.

         In connection with the audits of the years ended December 31, 2001 and
December 31, 2000 and during the interim period from January 1, 2002 up to and
including August 12, 2002, there were no disagreements with Andersen on any
matter of accounting principles or practices, financial statement disclosure, or
auditing scope or procedures, which disagreements, if not resolved to Andersen's
satisfaction, would have caused Andersen to make reference to the subject matter
of the disagreement in connection with Andersen's report.

<PAGE>

     Effective as of August 12, 2002, Weinstein Spira & Company, PC was approved
by the Company's Audit Committee and Board of Directors as the Company's new
independent auditors. Prior to such date management of the Company had not
previously consulted with Weinstein Spira & Company, PC concerning any
accounting, auditing or reporting matter.

     In accordance with Item 304(a)(3) of Regulation S-B, the Company requested
Andersen to furnish a letter addressed to the Securities and Exchange Commission
stating whether it agrees with the statements made by the Company in the Form
8-K referenced above. A representative of Andersen informed the Company that
Andersen was no longer furnishing such letters, and therefore, pursuant to Item
304T of Regulation S-B, no such letter was filed with such Form 8-K.

                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

     The information required by Item 9 is contained in the Company's proxy
statement to be used in connection with its 2003 annual meeting of stockholders
under the captions "Principal Security Holders" and "Nominees for Director,"
which information is incorporated herein by reference.

ITEM 10. EXECUTIVE COMPENSATION

     The information required by Item 10 is contained in the Company's proxy
statement to be used in connection with its 2003 annual meeting of stockholders
under the caption "Executive Compensation," which information is incorporated
herein by reference.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
         MANAGEMENT

     The information required by Item 11 is contained in the Company's proxy
statement to be used in connection with its 2003 annual meeting of stockholders
under the captions "Principal Security Holders" and "Nominees for Director,"
which information is incorporated herein by reference.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information required by Item 12 is contained in the Company's proxy
statement to be used in connection with its 2003 annual meeting of stockholders
under the captions "Principal Security Holders" and "Nominees for Director,"
which information is incorporated herein by reference.

<PAGE>

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

    (A)    Exhibits Required by Item 601 of Regulation S-B

                                                          * Filed Herewith or
                                                             Incorporated by
      Exhibit                                           Reference from Exhibit
      -------                                           ----------------------

      (3)    (a)  Certificate of Incorporation, as      3(a) 1989 Form 10-K
                  Amended, through June 6, 1989
             (b)  Articles of Amendment to              3(b) 1989 Form 10-K
                   Certificate of Incorporation
                   dated June 7, 1989
             (c)  Articles of Amendment to              3(c) 1993 Form 10-KSB
                   Certificate of Incorporation
                   dated May 21, 1993
             (d)  Bylaws, as Amended, through           3(d) June 30, 1989
                   date hereof                             Form 10-Q

      (99.1)   Certifications 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

         The Company filed no reports on Form 8-K during the quarter ended
         December 31, 2002.

ITEM 14.  CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures

      Based on their evaluation as of a date within 90 days of the filing
date of this Annual Report of the Company on Form 10-KSB for the year ended
December 31, 2002, the Company's Chief Executive Officer, its President and its
Senior Vice President - Finance and Principal Financial and Accounting Officer
have concluded that the Company's disclosure controls and procedures (as defined
in Rules 13a-14(c) and 15d-14(c) under the Securities Exchange Act of 1934) are
effective to ensure that information required to be disclosed by the Company in
reports that it files or submits under the Securities Exchange Act of 1934 is
recorded, processed, summarized and reported within the time periods specified
in Securities and Exchange Commission rules and forms.

Changes in internal controls

There were no significant changes in the Company's internal controls or in other
factors that could significantly affect these controls subsequent to the date of
their evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.

<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Southern Investors Service Company, Inc.:

We have audited the accompanying balance sheet of Southern Investors Service
Company, Inc. (a Delaware Corporation) (the Company) as of December 31, 2002,
and the related statements of loss, changes in stockholders' deficit and cash
flows for the year ended December 31, 2002. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit. The 2001 financial
statements were audited by other auditors, who have ceased operations, and whose
report dated March 27, 2002, on those financial statements included an
explanatory paragraph describing conditions that raised substantial doubt about
the Company's ability to continue as a going concern.

We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Southern Investors Service
Company, Inc. as of December 31, 2002, and the results of its operations and its
cash flows for year ended December 31, 2002, in conformity with accounting
principles generally accepted in the United States.

The Company's cash flow from operations has not been adequate to meet the
Company's obligations for the past several years. As of December 31, 2002, the
Company had sold substantially all of its operating assets and continues to have
a deficit in stockholders' equity. As described in Note 1 to the financial
statements, even though the Company has restructured certain indebtedness in the
last several years and sold substantially all of its operating assets, it
continues to be delinquent on $4,850,000 of debt. These factors raise
substantial doubt about the Company's ability to continue as a going concern.
Also as described in Note 1 to the financial statements, on March 26, 2002, the
Board of Directors of the Company determined that the best alternative to settle
the Company's existing debt was to file a voluntary petition for relief under
the bankruptcy laws. The Company currently anticipates filing a plan of
liquidation during 2003.

The accompanying financial statements have been prepared using the historical
cost basis of accounting. Management of the Company believes the historical cost
basis of accounting states assets at approximately their liquidation values and
states the Company's liabilities at their historical amounts. It is not
presently determinable what amounts the creditors will agree to accept in
settlement of the obligations due them. The accompanying financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.

Weinstein Spira & Company
Houston, Texas
March 18, 2003

<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

                    THE FOLLOWING REPORT IS A CONFORMED COPY
             OF THE REPORT PREVIOUSLY ISSUED BY ARTHUR ANDERSEN LLP
                     AND HAS NOT BEEN REISSUED BY THAT FIRM.

To Southern Investors Service Company, Inc.:

We have audited the accompanying balance sheet of Southern Investors Service
Company, Inc. (a Delaware Corporation) (the Company) as of December 31, 2001,
and the related statements of income (loss), changes in stockholders' deficit
and cash flows for each of the two years in the period ended December 31, 2001.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Southern Investors Service
Company, Inc. as of December 31, 2001, and the results of its operations and its
cash flows for each of the two years in the period ended December 31, 2001, in
conformity with accounting principles generally accepted in the United States.

The Company's cash flow from operations has not been adequate to meet the
Company's obligations for the past several years. As of December 31, 2001, the
Company had sold substantially all of its operating assets and continues to have
a deficit in stockholders' equity. As described in Note 1 to the financial
statements, even though the Company has restructured certain indebtedness in the
last several years and sold substantially all of its operating assets, it
continues to be delinquent on $4,831,000 of debt. These factors raise
substantial doubt about the Company's ability to continue as a going concern.
Also as described in Note 1 to the financial statements, on March 26, 2002, the
Board of Directors of the Company determined that the best alternative to settle
the Company's existing debt was to file a voluntary petition for relief under
the bankruptcy laws. The Company currently anticipates filing a plan of
liquidation during 2002.

The accompanying financial statements have been prepared using the historical
cost basis of accounting. Management of the Company believes the historical cost
basis of accounting states assets at approximately their liquidation values and
states the Company's liabilities at their historical amounts. It is not
presently determinable what amounts the creditors will agree to accept in
settlement of the obligations due them. The accompanying financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.

Arthur Andersen LLP
Houston, Texas
March 27, 2002

<PAGE>

                    SOUTHERN INVESTORS SERVICE COMPANY, INC.
                                  BALANCE SHEET
                                DECEMBER 31, 2002
                             (Thousands of Dollars)

<TABLE>
<CAPTION>
                       ASSETS

<S>                                                                             <C>
Cash                                                                            $     2,194

Equity in Real Estate Joint Ventures, Net                                               286

Notes Receivable and Other Assets                                                        39
                                                                                -----------

       Total assets                                                             $     2,519
                                                                                ===========

         LIABILITIES AND STOCKHOLDERS' DEFICIT

Liabilities
   Notes payable, matured                                                       $     4,850
   Accounts payable and accrued expenses                                              3,127
                                                                                -----------

       Total liabilities                                                              7,977
                                                                                -----------

Commitments and Contingencies

Stockholders' Deficit
   Preferred stock, $1 par, 1,000,000 shares authorized, none issued Common
   stock, $1 par, 10,000,000 shares authorized, 3,281,331
     shares issued                                                                    3,281
   Additional paid-in capital                                                         3,031
   Retained deficit                                                                 (11,644)
   Less treasury stock, 112,402 shares, at cost                                        (126)
                                                                                -----------

       Total stockholders' deficit                                                   (5,458)
                                                                                -----------

       Total liabilities and stockholders' deficit                              $     2,519
                                                                                ===========
</TABLE>


   The accompanying notes are an integral part of this financial statement.

<PAGE>

                    SOUTHERN INVESTORS SERVICE COMPANY, INC.
                               STATEMENTS OF LOSS
                (Thousands of Dollars, Except Per Share Amounts)

                                                   Year Ended December 31,
                                               ------------------------------
                                                   2002             2001
                                               ------------    --------------

Revenues                                       $          65   $         31

Operating Expenses                                       129            126
                                               -------------   ------------

Loss from Operations                                     (64)           (95)

Interest Income                                           50             90

Interest Expense                                        (314)          (322)
                                               -------------   ------------

Net Loss                                       $        (328)  $       (327)
                                               =============   ============

Basic and Diluted Loss Per Common Share        $       (0.10)  $      (0.10)
                                               =============   ============

Average Number of Shares Outstanding               3,168,929      3,168,929
                                               =============   ============


   The accompanying notes are an integral part of these financial statements.

<PAGE>

                    SOUTHERN INVESTORS SERVICE COMPANY, INC.
                 STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
                             (Thousands of Dollars)

<TABLE>
<CAPTION>

                                 Common Stock          Additional                                 Total
                         --------------------------     Paid-In      Retained      Treasury    Stockholders'
                            Shares         Amount       Capital       Deficit        Stock        Deficit
                         ----------      ----------   -----------   ----------    ---------   --------------
<S>                      <C>             <C>          <C>           <C>           <C>         <C>
Balance -
  December 31, 2000       3,281,331      $   3,281    $    3,031    $  (10,989)   $   (126)   $     (4,803)

Net Loss                                                                  (327)                       (327)
                         ----------      ---------    ----------    ----------    --------    ------------

Balance -
   December 31, 2001      3,281,331          3,281         3,031       (11,316)       (126)         (5,130)

Net Loss                                                                  (328)                       (328)
                         ----------      ---------    ----------    ----------    --------    ------------

Balance -
   December 31, 2002      3,281,331      $   3,281    $    3,031    $  (11,644)   $   (126)   $     (5,458)
                         ==========      =========    ==========    ==========    ========    ============
</TABLE>

   The accompanying notes are an integral part of these financial statements.

<PAGE>

                    SOUTHERN INVESTORS SERVICE COMPANY, INC.
                            STATEMENTS OF CASH FLOWS
                             (Thousands of Dollars)

<TABLE>
<CAPTION>
                                                                                      Year Ended December 31,
                                                                                --------------------------------
                                                                                   2002                  2001
                                                                                ----------            ----------
<S>                                                                             <C>                   <C>
Cash Flows From Operating Activities:
   Net Loss                                                                     $     (328)           $     (327)
   Change in assets and liabilities:
     (Increase) Decrease in notes receivable and other assets                          (14)                   79
     Increase in accounts payable and accrued expenses                                 294                   261
                                                                                ----------            ----------

       Net cash provided by (used in) operating activities                             (48)                   13
                                                                                ----------            ----------

Cash Flows From Financing Activities:
   Payments on notes payable                                                                                (105)
                                                                                ----------            ----------

       Net cash used in financing activities                                                                (105)
                                                                                ----------            ----------

Net Decrease in Cash                                                                   (48)                  (92)

Beginning Cash                                                                       2,242                 2,334
                                                                                ----------            ----------

Ending Cash                                                                     $    2,194            $    2,242
                                                                                ==========            ==========
</TABLE>

   The accompanying notes are an integral part of these financial statements.

<PAGE>

                    SOUTHERN INVESTORS SERVICE COMPANY, INC.
                          NOTES TO FINANCIAL STATEMENTS

(1)  Current Business Conditions

         Southern Investors Service Company, Inc., (the Company), was
incorporated under the laws of the State of Delaware in 1972. Prior to 1990, the
Company was engaged in the ownership and development of real estate primarily in
the Houston, Texas area. The operations of the Company were significantly
reduced during 1990, as a result of various debt settlements with lenders and
other creditors. These settlements resulted in the transfer of substantially all
of the Company's holdings to its creditors. The Company's operations since 1990
have been limited to attempts to settle or restructure the Company's remaining
liabilities. The Company's operations also included the management of
residential developments and two office buildings owned by others. During 1998,
the majority of these residential projects were sold by the owners and therefore
the Company no longer is managing these projects. Effective January 1, 1999, the
Company ceased all management activity and all employees related to this
activity were terminated.

         The Company determined in late 1999 that the sale of Lajitas (a resort
property in west Texas), its sole remaining operating asset, would facilitate
the Company's ability to settle its existing liabilities most favorably. As a
result, the Company retained the National Auction Group, Inc., (National
Auction) to conduct an auction of Lajitas. The auction was conducted on February
24, 2000 and the property was sold for $3,950,000. The sale of the Lajitas
property closed on May 2, 2000. During 2000, the Company realized a gain on the
sale of Lajitas of $755,000 and received net cash proceeds of approximately $2.4
million, after the payment of a mortgage note related to the property sold. See
also Notes 5 and 7.

         The Company has attempted to use the net proceeds from the sale of
Lajitas to settle or restructure existing debt, of which approximately
$4,850,000 (plus accrued interest) has matured and is currently past due, and to
realize the carrying amount of its remaining assets. On March 26 2002, the Board
of Directors of the Company determined that the best alternative to settle the
Company's existing debt was to file a voluntary petition for relief under
Chapter 11 of Title 11 of the United States Bankruptcy Code (Chapter 11) with
the United States Bankruptcy Court (Bankruptcy Court). The Company currently
anticipates that it will file its voluntary petition with the Bankruptcy Court
during 2003 and that any plan of liquidation submitted to the Bankruptcy Court
in connection therewith will call for the disposition of the Company's remaining
assets and the distribution of all the net proceeds therefrom to the Company's
creditors. These financial statements have been prepared using the historical
cost basis of accounting. Management of the Company believes the historical cost
basis of accounting states assets at approximately their liquidation values and
states the Company's liabilities at their historical amounts. It is not
presently determinable what amounts the creditors will agree to accept in
settlement of the obligations due them. These financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
Accordingly, the Company believes the equity of the Company has, and will
continue to have, no value and that any Chapter 11 plan confirmed by the
Bankruptcy Court will result in the elimination of the equity interests of all
of the Company's stockholders. The Company anticipates that it will take
approximately nine months to complete its liquidation process; however, any and
all Chapter 11 plans that may be proposed will be subject to obtaining all
necessary approvals, including but not limited to creditor votes and judicial
determinations of confirmability. There can be no assurance, therefore, as to
how long it may take to complete the Company's liquidation process.

<PAGE>

(2)  Summary of Significant Accounting Policies

         Income and expenses are recorded on the accrual basis of accounting.
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. The
investments in real estate joint ventures in which the Company's ownership is
less than 20% are carried at cost unless the Company exercises significant
influence. The Company's most significant estimates and assumptions relate to
evaluating its real estate joint ventures for impairment.

CASH AND CASH EQUIVALENTS

         The Company considers all short-term investments with an original
maturity of three months or less to be cash equivalents. The Company had
deposits in excess of federally insured limits totaling $1,880,806 as of
December 31, 2002.

INCOME TAXES

         Income taxes are provided on the liability method whereby deferred tax
assets are recognized for deductible temporary differences, and operating loss
and tax credit carry forwards, and deferred income tax liabilities are
recognized for taxable temporary differences. Temporary differences are the
differences between the reported amounts of assets and liabilities and their tax
bases. Deferred income tax assets are reduced by a valuation allowance when, in
the opinion of management, it is more likely than not that some portion or all
of the deferred income tax assets will not be realized. Deferred income tax
assets and liabilities are adjusted for the effects of changes in tax laws and
rates on the date of enactment.

FAIR VALUE OF FINANCIAL INSTRUMENTS

         The carrying amounts of cash and notes receivable approximate fair
value due to relatively short maturities. It was not practicable to estimate the
fair value of debt and related accrued interest as the debt has matured and the
Company anticipates filing a plan of liquidation in which it will have to settle
the debt for cash payments or transfer of other assets at substantially less
than amounts due.

INCOME (LOSS) PER COMMON SHARE

         Income (loss) per common share was computed in accordance with
Statement of Financial Accounting Standards No. 128, "Earnings Per Share" issued
by the Financial Accounting Standards Board during 1997.

PREFERRED STOCK

         The Company has authorized 1 million shares of $1.00 par value
preferred stock. No such stock has been issued. The preferred stock may be
issued in one or more series, with the shares in each such series having such
voting powers and such designations, preferences and relative participating,
optional redemption, conversion, exchange and other special rights and
restrictions as may be fixed by a resolution of the Company's Board of
Directors.

<PAGE>

(3)  Equity in Real Estate Joint Ventures

         The Company has investments in two ventures accounted for on the cost
method. These ventures had a book value of $286,000 as of December 31, 2002.

         Management continues to monitor the impact of changes in economic
conditions to determine the effect on the carrying value of its equity in real
estate joint ventures. The effect of any significant changes will be reported in
income in the period such effect can be reasonably estimated.

         In August 2001 the Financial Accounting Standards Board (FASB) issued
SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets."
This statement supercedes SFAS No.121 "Accounting for the Impairment of
Long-Lived Assets and Long-Lived Assets to be Disposed Of" and the accounting
and reporting provisions of Accounting Principles Board Opinion (APB) No. 30.
This statement retains the fundamental provision of SFAS No. 121 and the basic
requirements of APB No. 30, however, it establishes a single accounting model to
be used for long-lived assets to be disposed of by sale, and it expands the
presentation of discontinued operations to include more disposal transactions.
The provisions of this statement became effective for the Company beginning
January 1, 2002. The adoption of this statement did not have a material impact
on the Company's financial position or results of operations.

(4)  Federal Income Taxes

         The estimated tax effect of temporary differences and tax attributes
representing deferred tax liabilities and assets is summarized as follows:

                                                                December 31,
                                                                   2002
                                                          ---------------------

                                                          (Thousands of Dollars)

Deferred tax asset due to:
   Tax loss carryforwards                                    $         8,814
   Other                                                                  30
                                                             ---------------

   Gross deferred tax asset                                            8,844

Deferred tax liability due to:
   Basis difference in investment in joint ventures                     (835)
                                                             ---------------

   Net deferred tax asset                                              8,009
   Less: Valuation allowance                                          (8,009)
                                                             ---------------

                                                             $             0
                                                             ===============

<PAGE>

         The Company estimates that as of December 31, 2002, its loss carry
forward for federal income tax reporting purposes, was approximately $25.9
million, of which approximately $2.9 million was a passive activity loss
carryforward and approximately $5.2 million was a capital loss carry forward.
The loss carry forward will begin to expire in 2003. The tax benefit of the
operating loss carry forward has been recognized to the extent of the deferred
taxes provided on temporary differences which are expected to reverse during the
carry forward period. The valuation allowance as of December 31, 2002 totaled
$8,009,000, an increase of approximately $84,000 from December 31, 2001.

         A reconciliation of the provision (benefit) for federal income tax at
the effective statutory rate to the effective rate for financial reporting is as
follows:

<TABLE>
<CAPTION>
                                                                     Year Ended December 31,
                                               ------------------------------------------------------------
                                                           2002                            2001
                                               ----------------------------     ---------------------------
                                               (Thousands of  Dollars)          (Thousands of Dollars)
<S>                                            <C>                              <C>
Tax benefit at statutory rate                  $         (112)          (34)%   $      (111)          (34)%
Unrecognized tax benefit                                  112            34             111            34
                                               --------------     ---------     -----------      --------

Tax provision (benefit) for financial
   reporting                                   $            0            00%    $         0             00%
                                               ==============     ---------     -----------      ---------
</TABLE>

         No income taxes were paid during 2002 or 2001.

(5)      Notes Payable

NOTES PAYABLE

         The Company's notes payable which are all currently past due are
summarized as follows:

<TABLE>
<CAPTION>
                                                                                    December 31,
                                                                                       2002
                                                                                ---------------------

                                                                                (Thousands of Dollars)
<S>                                                                             <C>
Matured notes, bearing interest at rates ranging from 6% to 10%                 $             1,410
Matured notes issued to various debenture holders, bearing interest at 6%
 (See Note 7)                                                                                 3,440
                                                                                -------------------

                                                                                $             4,850
                                                                                ===================
</TABLE>

<PAGE>

     During 1993, the Company restructured debentures with an aggregate
principal balance of $2,331,000, debenture loans advanced by certain debenture
holders with aggregate principal balances of $639,000 and accrued and unpaid
interest with respect to these debentures and debenture loans of approximately
$470,000 in exchange for unsecured promissory notes of the Company. These notes
have an aggregate principal balance of $3,440,000 and bear interest at 6%
compounded annually.

     As of December 31, 2002, the Company had not received any notices of
default or acceleration from any of its lenders.

     As of December 31, 2002, in addition to the past due principal amounts set
forth on the above table, the Company was also delinquent in accrued interest
payments on its notes payable in the aggregate amount of $3,065,000.

     Interest paid on the indebtedness during the years ended December 31, 2002
and 2001 was $0 and $8,000, respectively.

(6) Commitments and Contingencies

     If the Company, in the light of its present circumstances, were required to
make substantial cash expenditures in connection with future lawsuits and other
claims, such expenditures might have a material adverse effect on the Company's
financial position.

(7) Related Party Transactions

     The Company has no paid employees and during 2000 entered into an oral
management agreement with a company affiliated with Walter M. Mischer , Sr. and
Walter M. Mischer, Jr. to provide accounting and other administrative services
and related office facilities and supplies. These services are provided for a
fee of $1,000 per month and totaled $12,000 for each of 2002 and 2001.

     The Lajitas resort property was subject to a mortgage in the amount of
$726,000, including accrued interest, in favor of Walter M. Mischer, Sr.
Chairman of the Board and Chief Executive Officer of the Company. At the closing
of the sale of Lajitas, the Company used a portion of the proceeds to repay this
indebtedness in order to remove the mortgage lien from the property and convey
free and clear title to the buyer. As part of the property sold, the buyer
purchased a portion of the employee housing at the resort previously owned by
Mr. Mischer. Mr. Mischer agreed to provide such employee housing for Lajitas at
a time when the Company was unable to finance its construction on acceptable
terms. Mr. Mischer agreed to sell this housing to the Company for $237,000 which
was the cost incurred by Mr. Mischer in connection with the construction.

     During 1996, the Company executed a note payable to Mr. Mischer which note
was secured by receivables, was payable monthly as collections on the related
receivables were received, and bore interest at the rate of 9%, with a final
maturity of July 2001. During 2000, the Company made principal payments of
$65,000 in connection with this note. As of December 31, 2000, the outstanding
principal balance was $124,000 and the note was paid in full during 2001.

<PAGE>

     During 1993, in connection with the restructure of the Company's
debentures, the Company issued $3,440,000 in unsecured promissory notes to
certain directors, stockholders and affiliates including notes to Mr. Mischer,
Mr. Mischer, Jr., John D. Weil and John W. Storms, Trustee, in the aggregate
principal amount of $2,995,000 to consolidate amounts due for the debentures
held by them and accrued and unpaid interest. These notes bear interest at 6%
compounded annually and were due October 2, 1996.

     Mr. Mischer and Mr. Mischer, Jr. participate in real estate projects in the
Houston area which may compete with the Company's projects.

(8) Accounts Payable and Accrued Expenses

     Accounts payable and accrued expenses included the following:

                                                              December 31,
                                                                  2002
                                                             -------------
                                                             (Thousands of
                                                                Dollars)

Accrued interest payable                                  $             3,065
Other accrued liabilities                                                  62
                                                          -------------------

                                                          $             3,127
                                                          ===================

<PAGE>

                                   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.

                    SOUTHERN INVESTORS SERVICE COMPANY, INC.

                           By:

                           /s/ Walter M. Mischer, Sr
                           ---------------------------------
                           Walter M. Mischer, Sr.
                           Chairman of the Board
                           Chief Executive Officer

                           Date: March 28, 2003

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.

/s/ Walter M. Mischer, Sr.                     Date:  March 28, 2003
---------------------------------------
Walter M. Mischer, Sr.
Chairman of the Board and
Chief Executive Officer
Director


/s/ Walter M. Mischer, Jr.                     Date:  March 28, 2003
---------------------------------------
Walter M. Mischer, Jr.
President and Director
Chief Operating Officer


/s/ Eric Schumann                              Date:  March 28, 2003
---------------------------------------
Eric Schumann
Senior Vice President - Finance and Director
Principal Financial and Accounting Officer

<PAGE>

                                 CERTIFICATIONS

I, Walter M. Mischer, Sr., certify that:

1.   I have reviewed this annual report on Form 10-KSB of Southern Investors
     Service Company, Inc.;

2.   Based on my knowledge, this annual 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 annual report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this annual 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 annual 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 we 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 annual 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
         annual report (the "Evaluation Date"); and

     (c) presented in this annual 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
     annual 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: March 28, 2003            /s/  Walter M. Mischer, Sr.
                                     ------------------------------

                                     Name: Walter M. Mischer, Sr.
                                     Title: Chief Executive Officer

<PAGE>

I, Walter M. Mischer, Jr., certify that:

1.   I have reviewed this annual report on Form 10-KSB of Southern Investors
     Service Company, Inc.;

2.   Based on my knowledge, this annual 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 annual report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this annual 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 annual 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 we 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 annual 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
         annual report (the " Evaluation Date"); and

     (c) presented in this annual 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
     annual 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: March 28, 2003         /s/ Walter M. Mischer, Jr.
                                  ---------------------------------------------

                                  Name: Walter M. Mischer, Jr.
                                  Title: President - Principal Executive Officer

<PAGE>

I, Eric Schumann, certify that:

1.   I have reviewed this annual report on Form 10-KSB of Southern Investors
     Service Company, Inc.;

2.   Based on my knowledge, this annual 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 annual report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this annual 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 annual 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 we 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 annual 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
         annual report (the " Evaluation Date"); and

     (c) presented in this annual 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
     annual 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: March 28, 2003      /s/ Eric Schumann
                               ------------------------------------------

                               Name: Eric Schumann
                               Title: Senior Vice President - Finance
                               Principal Financial and Accounting Officer