UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE PERIOD ENDED June 30, 2003
OR
[] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD From to .
-------------------- ----------------------
Commission File Number 333-88480
PRIME RESOURCE, INC.
--------------------
(Exact name of registrant as specified in its charter)
Utah 04-3648721
------------------------------- -----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1245 East Brickyard Road, Suite 590
Salt Lake City, Utah 84106
----------------------------
(Address of principal executive officers)
(801) 433-2000 (Registrant's
telephone number, including area code)
None
(Former name, former address and former fiscal year,
if changed since last report)
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant has filed all documents and reports required to be
filed by Sections 12, 13, or 15(d) of the Securities Exchange Act of 1934
subsequent to the distribution of securities under a plan confirmed by the
court. Yes No Not Applicable
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APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date.
Common Stock: 2,950,000 shares issued as of August 13, 2003, No Par Value.
Authorized 50,000,000 common voting shares.
INDEX
Prime Resource, Inc.
For The Quarter Ending June 30, 2003
Part I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheet - June 30, 2003 (Unaudited).
Consolidated Statements of Operations (Unaudited) - For the three
months and six months ended June 30, 2003 and for the three months and
six months ended June 30, 2002.
Consolidated Statements of Cash Flows (Unaudited) - For the six months
ended June 30, 2003, and for the six months ended June 30, 2002.
Notes to Consolidated Financial Statements (Unaudited) - June 30,
2003.
Item 2. Management's Discussion and Analysis o Financial Condition or Plan
of Operation.
Controls and Procedures
Part II. Other Information
Item 2. Changes in Securities and Use of Proceeds
Item 5. Other Matters
Item 6. Exhibits and Reports on Form 8-K
Signatures
Certifications
Part I - Financial Information
Item 1. Financial Statements
PRIME RESOURCE, INC. AND SUBSIDIARIES
(Formerly Prime Resource, LLC and Subsidiaries)
CONSOLIDATED BALANCE SHEET (Unaudited)
June 30, 2003
Assets
Current Assets:
Cash and cash equivalents $ 698,399
Accounts receivable 436,121
---------------
Total current assets 1,134,520
Fixed Assets:
Furniture and fixtures 123,963
Office equipment 33,365
Computer equipment 44,025
Software 18,914
Vehicles 110,591
---------------
Total fixed assets 330,858
Less accumulated depreciation (161,824)
---------------
Net fixed assets 169,034
Advances and notes receivable from related parties 117,368
Other assets 35,503
---------------
Total assets $ 1,456,425
===============
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $ 17,533
Accrued expenses 273,134
Current portion of notes payable, related parties 87,149
---------------
Total current liabilities 377,816
Deferred income taxes 25,138
Notes payable to related party, less current portion 34,502
Common stock, no par value; authorized 50,000,000 shares;
issued and outstanding 2,950,000 shares 750,000
Additional paid-in capital 197,763
Retained earnings 71,206
---------------
1,018,969
---------------
Total liabilities and stockholders' equity $ 1,456,425
===============
See notes to consolidated financial statements.
PRIME RESOURCE, INC. AND SUBSIDIARIES
(Formerly Prime Resource, LLC and Subsidiaries)
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Six months ended June 30, Three months ended June 30,
2003 2002 2003 2002
-------------- ------------- ------------- -------------
Net Revenues
Commissions $ 1,647,232 $ 864,225 $ 827,286 $ 429,373
Investment and business advisory fees 159,199 252,742 72,814 162,096
-------------- ------------- ------------- -------------
Total net revenues 1,806,431 1,116,967 900,100 591,469
Operating Expenses
Commissions 690,474 283,839 443,011 152,787
Compensation and benefits 571,012 688,069 292,248 304,629
General and administrative 265,528 163,028 147,426 48,228
Occupancy and equipment 57,859 52,205 28,489 26,480
Depreciation and amortization 23,717 23,172 12,329 11,007
-------------- ------------- ------------- -------------
Total operating expenses 1,608,590 1,210,313 923,503 543,131
-------------- ------------- ------------- -------------
Income (loss) from operations 197,841 (93,346) (23,403) 48,338
Interest and dividend income 1,068 7,398 808 5,453
Interest expense (2,327) (1,746) (1,305) (1,746)
Other income (expense) (15,024) - (4,696) -
-------------- ------------- ------------- -------------
Total other income (expense) (16,283) 5,652 (5,193) 3,707
Net income (loss) before income taxes 181,558 (87,694) (28,596) 52,045
-------------- ------------- ------------- -------------
Income tax expense (benefit) 102,652 19,801 18,957 19,801
-------------- ------------- ------------- -------------
Net income (loss) $ 78,906 $ (107,495) $ (47,553) $ 32,244
============== ============= ============== =============
Earnings per weighted average
shares outstanding $ 0.03 $ (0.08) $ (0.02) $ 0.01
============== ============= ============== =============
Weighted shares outstanding to
calculate earnings per share 2,862,155 1,345,856 2,923,626 2,676,923
See notes to consolidated financial statements.
PRIME RESOURCE, INC. AND SUBSIDIARIES
(Formerly Prime Resource, LLC and Subsidiaries)
CONSOLIDATED STATEMENTS OF MEMBERS' AND STOCKHOLDERS' EQUITY
(Unaudited)
January 1, 2002 to June 30, 2003
Members' Common Stock Paid-in Retained
Equity Shares Amount Capital Deficit
-------------- ----------- ----------- ----------- ------------
Balance, January 1, 2002 $ 220,338 - $ - $ - $ -
Net loss through date of
incorporation (April 4, 2002) (135,575) - - - -
Member contribution 113,000 - - - -
Reorganization from LLC to
corporation (April 4, 2002) (197,763) 2,800,000 - 197,763 -
Net loss from April 4, 2002
through December 31, 2002 - - - - (7,700)
-------------- ----------- ----------- ----------- ------------
Balance, December 31, 2002 - 2,800,000 - 197,763 (7,700)
Shares issued in IPO - 150,000 750,000 - -
Net income - - - - 78,906
-------------- ----------- ----------- ----------- ------------
Balance, June 30, 2003 $ - 2,950,000 $ 750,000 $ 197,763 $ 71,206
============== =========== =========== =========== ============
See notes to consolidated financial statements.
PRIME RESOURCE, INC. AND SUBSIDIARIES
(Formerly Prime Resource, LLC and Subsidiaries)
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended June 30, 2003 and 2002
2003 2002
--------------- ---------------
OPERATING ACTIVITIES
Net Income (loss) $ 78,906 $ (107,495)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation 23,717 23,172
Write-off of notes receivable from related parties 5,768 194,181
Change in deferred taxes 51,644 15,774
Changes in operating assets and liabilities
Accounts receivable (295,494) (26,818)
Other assets (22,399) (67,687)
Accounts payable (54,819) 34,586
Accrued expenses 105,229 (176,553)
--------------- ---------------
NET CASH USED IN OPERATING ACTIVITIES (107,448) (110,840)
INVESTING ACTIVITIES
Purchase of property and equipment (28,888) (11,381)
Proceeds from sale of investment - 50,125
--------------- ---------------
NET CASH PROVIDED BY (USED IN) INVESTING
ACTIVITIES (28,888) 38,744
FINANCING ACTIVITIES
Proceeds from notes payable to related parties - 52,349
Stock issuance 750,000 -
Member investments - 113,000
--------------- ---------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 750,000 165,349
INCREASE (DECREASE) IN CASH 613,664 93,253
Cash and cash equivalents, beginning of period 84,735 32,102
--------------- ---------------
Cash and cash equivalents, end of period $ 698,399 $ 125,355
=============== ===============
Additional required disclosures:
Interest paid in cash $ 2,327 $ -
See notes to consolidated financial statements.
PRIME RESOURCE, INC. AND SUBSIDIARIES
(Formerly Prime Resource, LLC and Subsidiaries)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2003
(1) INTERIM FINANCIAL STATEMENT POLICIES AND DISCLOSURES
The unaudited, consolidated, condensed financial statements of Prime Resource,
Inc. and Subsidiaries (the Company) included herein have been prepared pursuant
to the rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally required in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although the
Company believes that the disclosures are adequate to make the information
presented not misleading.
These consolidated, condensed financial statements reflect all adjustments that,
in the opinion of management, are necessary to present a fair statement of the
results of operations for the interim periods presented. All of the adjustments
that have been made in these consolidated, condensed financial statements are of
a normal recurring nature.
It is suggested that these condensed financial statements be read in conjunction
with the financial statements and the notes thereto included in the Company's
latest Annual Report.
(2) INITIAL PUBLIC OFFERING
The Company commenced an initial public offering of its shares on April 16,
2003, when its registration became effective. The Company raised $750,000
through the sale of 150,000 shares and closed the offering on July 16, 2003.
Item 2. Management's Discussion and Analysis of Financial Condition or Plan of
Operation
Forward-Looking Information
Certain statements in this Section and elsewhere in this report are
forward-looking in nature and relate to trends and events that may affect the
Company's future financial position and operating results. Such statements are
made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. The terms "expect,""anticipate,""intend," and "project" and
similar words or expressions are intended to identify forward-looking
statements. These statements speak only as of the date of this report. The
statements are based on current expectations, are inherently uncertain, are
subject to risks, and should be viewed with caution. Actual results from
experience may differ materially from the forward-looking statements as a result
of many factors, including changes in economic conditions in the markets served
by the company, increasing competition, fluctuations in raw materials and energy
prices, and other unanticipated events and conditions. It is not possible to
foresee or identify all such factors. The company makes no commitment to update
any forward-looking statement or to disclose any facts, events, or circumstances
after the date hereof that may affect the accuracy of any forward- looking
statement.
Plan of Operation
Prime Resource, Inc. ("Prime") is a Utah Corporation which was organized and
filed of record on March 29, 2002 as a successor entity to Prime, LLC. Prime is
an integrated business entity that conducts all of its actual business
activities through its wholly owned subsidiaries: Belsen Getty, LLC ("Belsen
Getty") and Fringe Benefit Analysts, LLC ("Fringe"). Unless otherwise
specifically described in this offering, the reference to Prime shall
collectively mean both Prime and its two operating subsidiaries. Prime has
recently created a new subsidiary, described under Item 5, but which limited
liability company has not yet commenced business operations.
The principal business activity of Prime has been, and will continue to be,
providing insurance and related insurance products principally in the health,
life, dental and disability areas, as well as implementing and managing various
employee related benefit programs and plans, such as 401(k) retirement accounts.
The insurance activities of Prime are primarily conducted through Fringe. Belsen
Getty supplies collateral services related primarily to pension and investment
management programs, as well as retirement planning and general business
consulting.
Management intends to attempt to grow the company primarily through the
acquisition of other insurance providers into the Fringe Benefit entity.
Concurrently, Belsen Getty is attempting to expand its financial and business
consulting and pension planning services principally by creating a more
extensive investment advisory role and aggressive marketing.
The company completed an initial public offering of its shares on June 16, 2003
in which it
raised $750,000 in gross proceeds and $709,664 in net proceeds. It intends to
employ these funds for acquisitions to grow its core insurance services and
products as generally discussed above. A more detailed description of the use of
proceeds is contained in the prospectus for the completed public offering. Any
person wishing to obtain a copy of that prospectus material, including the use
of proceeds outline, may obtain a copy online at the Securities and Exchange
Commission ("SEC") website at www.sec.gov\edgar. Alternatively, a copy of the
prospectus will be made available to any shareholder, or other interested party,
upon request to the company at its principal address at 1245 East Brickyard
Road, Suite 590, Salt Lake City, UT 84106.
To date, the company has expended only a minimal portion of offering proceeds
which is reported under Item 5 of this report pursuant to SEC Rule 463. It is
intended that most of the offering proceeds will be used for acquiring other
insurance providers in an effort to grow our business.
The company's long term growth and potential to realize profits is substantially
dependent upon the ability of management of the company to successfully employ
the proceeds of the recent public offering in a manner which will generate
additional revenues and potential net income to Prime. No assurance or warranty
of the success of Prime can be made or implied at this time. The proceeds of the
offering have just recently been received and have not been significantly
employed in any manner. This section is not included in this 10-QSB because none
of the proceeds, as of the date of this report, have been expended, except for
costs of the offering which totaled approximately $40,336.00 of the gross
proceeds.
As may be noted from the foregoing financial statements, the company experienced
a net loss of $107,495 for the six months ended June 30,2002. In the first six
months of 2003 the company realized a small net profit of $ 78,906 primarily due
to increased insurance revenues. In the current quarter we had net loss of $
47,553 on gross revenues of $ 900,100. We attribute this growth in revenue
primarily to aggressive marketing of our services and products to new clients.
Each person reviewing this report should understand that the company has not had
historical profits and that the first six months of 2003 evidences the first
profit realized by the company since inception. The failure of the company to
have historical profits should be considered as a potential risk factor to any
person acquiring securities of the company in that it does not have a proven or
sustained profit history.
At present, the outstanding current liabilities of the company are presently $
377,816 as of June 30, 2003. The company has accumulated retained earnings from
its inception as a corporate entity to June 30, 2003 of $ 71,206 .
Products and Markets
As generally described above, the revenue sources to Prime are primarily divided
into two categories. The first being the sale of a broad line of insurance
products and services through Fringe with a primary emphasis on group health,
disability and life policies. The insurance activities of Prime are primarily
offered within twelve western states. Prime acts as a general agent through
Fringe for various companies in supplying the insurance policies and services.
However, four companies account, collectively, for almost all of the policies
provided. These four principal suppliers of policies to Prime are Altius
Insurance, (previously Pacific Health Care); United Health Care; Intermountain
Health Care and Regence Blue Cross. Commissions for the placement of these
products range from approximately 2-20%. The company currently
has, as of March 31, 2003, approximately 829 customers who are receiving ongoing
insurance coverage and related services from Fringe. Fringe also has what it
believes to be a unique program related to its insurance activities in which it
provides at little or no cost to the client the administration for various
insurance programs such as COBRA, HIPAA and State continuation plans and other
insurance related plans that require ongoing filing and consulting/management
services. Fringe believes it has been successful in growing its business through
supplying these services to the insurance policy client. The company believes it
has been successful in maintaining a profit while providing these services
without additional cost by obtaining discounts from its insurance providers on
insurance products in partial consideration for providing these ongoing
management services. This program is generally called the "Advantage Program".
Belsen Getty supplies investment advisory and pension management services to
various clients of Prime. Some, but not all, of these clients are referred by
Fringe incident to completion of insurance funded products sold to various
individuals and entities which then require pension fund management. The
compensation for these valuable services are derived on a fee basis. The fees
range from 38 basis points to 125 basis points per year depending upon the size
of the portfolio or program managed. There are no commissions paid on investment
products and the assets are held by third party custodians, such as various
brokerage firms. It is anticipated that the Belsen Getty portion of the business
will grow concurrently with the growth of the Fringe business, but for the
foreseeable future will generate revenues substantially less than the Fringe
component of the business. At present, Belsen Getty has approximately 437
customers as of June 30, 2003.
Liquidity and Sources of Capital
As previously noted, the parent entity, Prime Resource, Inc., completed a public
offering as of April 16, 2003 resulting in net proceeds to the company of
$709,664. It is believed and anticipated that these proceeds will be sufficient
to implement the general growth plan of the company, as generally described
above, and which includes primarily acquisition of other insurance companies or
insurance lines of business, as well as the recruitment and training of
insurance agents with existing books of business and clients. No warranty or
assurance of the success of this proposed plan of operation can be made, but it
is believed that there is sufficient existing capital in the company to
implement this plan from the proceeds of the offering. Prime is presently in a
position where it believes that its general revenues can sustain other business
operations, including salaries, rent, utilities and other overhead costs,
without the employment of offering proceeds for those general operating
purposes.
The company has no present plans for any additional offering of its securities
or other capital formation activities for the foreseeable future.
Further, the company does not significantly rely on lines of credit or other
bank loans for its present operations and has total outstanding debt
obligations, as of June 30, 2003, of approximately $ 437,456.
Controls and Procedures
(a) Prime maintains controls and procedure designed to ensure that
information required to be disclosed in the reports that the Company
files or submits under the Securities Exchange Act of 1934 is
recorded, processed, summarized and reported within the time periods
specified in the rules and forms of the Securities and Exchange
Commission. Based upon their evaluation of those controls and
procedures performed within 90 days of the filing date of this report,
the chief executive officer and the principal financial officer of the
Company concluded that the Company's disclosure controls and
procedures were adequate for its present activities.
(b) Changes in internal controls. The Company made no significant changes
in its internal controls since completing its public offering. The
company is presently seeking a listing of its stock on the National
Association of Securities Dealers ("NASD") sponsored Electronic
Bulletin Board, but does not view such listing as requiring a change
in its accounting or auditing practices at the present time.
(c) Should the company subsequently seek a listing on an exchange or any
established NASD listing, such as the NASDAQ small cap markets, it is
aware that other accounting/auditing standards, such as the
establishment of an independent audit committee, would be required.
(d) The company is aware of the general standards and requirements of the
recent Sarbanes-Oxley Act of 2002 and has implemented procedures and
rules to comply so far as applicable, such as a prohibition on company
loans to management and affiliates.
Part II - Other Information
Item 5. Other Matters
(1) Public Offering & Use of Proceeds. As generally noted above, Prime
completed its initial public offering of 150,000 shares to 17 new shareholders
as of June 16, 2003. Pursuant to SEC Rule 463, the use or employment of the
proceeds are periodically disclosed as part of this report. We have elected to
set-out such information in a tabular format:
1. Offering Effective Date 4/16/2003
2. Offering Closed 6/16/2003 $ 750,000 $ 709,664
Gross Proceeds Net Proceeds
3. Costs of offering including legal,
accounting, filing fees, consulting
and miscellaneous (No commissions
were paid) $ 40,336
4. No direct payments were made to any
officer, director or affiliated
person. The offering was a
self-underwriting with no
commissions. 0 0
5. Of the net proceeds, the following
expenditures have been made:
(i) Marketing Advantage Program $ 2,915.00
(ii) Management Fees to Prime $ 10,000.00
(2) Formation of New Subsidiary. Prime reports, as a subsequent event,
the creation of a new wholly owned subsidiary on July 3, 2003 known as Prime
Retirement Services, LLC. This entity is a wholly owned Utah Limited Liability
Company which intends to license from BenefitStreet, Inc. certain qualified
retirement plan software, websites, and related services to offer daily
valuation services to pension plans with an open investment platform, which
provides potentially over 12,000 mutual funds to plan sponsors at a competitive
cost. This subsidiary has not yet actively engaged in its intended business
activities.
(3) Appointment of New Auditors. . The company announced that,
effective as of August 1, 2003, it has retained Child, Sullivan & Company of
Kaysville, Utah as its new independent auditors. This notice is being filed as a
substitute notice for an 8-K filing of this contemporary event. The new firm
replaces the firm of Carver & Hovey, which resigned
concurrently with the substitution of the new auditors. The company has no
differences of opinion with its prior or current auditors.
(4) Trading. The company presently does not have any active trading
market and, as of the date of this report, is engaged in attempting to complete,
through a Salt Lake City brokerage firm, a filing for NASD listing on the
Electronic Bulletin Board. The Electronic Bulletin Board is essentially an
informal trading mechanism managed by the National Association of Securities
Dealers, but does not constitute a regular NASDAQ exchange or listing, but is
essentially an electronic intra-dealer quotation system for small public
companies not meeting the requirements for regular NASDAQ listing. The company
cannot presently give any warranty or assurance that it will be successful in
completing such listing, but is presently actively engaged through a designated
broker/dealer in attempting to obtain this listing and will, subsequently,
report the completion of any listing requirements as an 8-K filing.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
99.1 Certification under Section 906 of the Sarbanes Oxley Act of 2002 (18
U.S.C. SECTION 1350)
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the reporting period.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
Date: August 14, 2003 By: /s/ Terry M. Deru
----------------------------------
Mr. Terry M. Deru President,
Director
Date: August 14, 2003 By: /s/ Andrew W. Limpert
----------------------------------
Mr. Andrew W. Limpert
Director, Treasurer/CFO
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Prime Resource, Inc. (the "Company")
on Form 10-QSB for the period ending June 30, 2003, as filed with the Securities
and Exchange Commission on the date hereof (the "Report"), we, Mr. Terry Deru,
President and Chief Executive Officer and Mr. Andrew Limpert, Chief Financial
Officer, certify to the best of our knowledge, pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
that:
(1) The report fully complies with the requirements of section 13 (a)
or 15 (d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Company.
Date: August 14, 2003 /s/ Terry M. Deru
----------------------------------
Mr. Terry M. Deru President,
Director
Date: August 14, 2003 /s/ Andrew W. Limpert
----------------------------------
Mr. Andrew W. Limpert CFO, Director
Attachment A
CERTIFICATION
I, Terry M. Deru, President and Director of Prime Resource, Inc certify that:
(1) I have reviewed this quarterly report on Form 10-QSB of Prime
Resource, Inc;
(2) Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
(3) Based on my knowledge, the financial statements, and other
financial information included in this quarterly report fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this quarterly
report;
(4) The registrant's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and 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 quarterly
report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date'); and
(c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
(5) The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):
(a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
(b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
(6) The registrant's other certifying officers and I have indicated in
this quarterly report whether or not 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: August 14, 2003 /s/ Terry M. Deru
----------------------------------
Mr. Terry M. Deru President
Attachment A
CERTIFICATION
I, Andrew W. Limpert, Chief Financial Officer and Director of Prime Resource,
Inc certify that:
(1) I have reviewed this quarterly report on Form 10-QSB of Prime
Resource, Inc.;
(2) Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
(3) Based on my knowledge, the financial statements, and other
financial information included in this quarterly report fairly present in all
material respects the financial condition, results of operations and cash flows
of the registrant as of, and for, the periods presented in this quarterly
report;
(4) The registrant's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and 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 quarterly
report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date'); and
(c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
(5) The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):
(a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
(b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
(6) The registrant's other certifying officers and I have indicated in
this quarterly report whether or not 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: August 14, 2003 /s/ Andrew W. Limpert
----------------------------------
Mr. Andrew W. Limpert Chief
Financial Officer, Director