ý
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QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
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COLORADO
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|
90-0224471
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(State or other jurisdiction of
incorporation or organization)
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|
(IRS Employer
Identification No.)
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Large accelerated filer
|
¨
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Accelerated filer
|
ý
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Non-accelerated filer
|
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
|
•
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Inability to strengthen our business and properly manage distractions among our distributors in Japan;
|
•
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Inability to manage existing markets, open new international markets or expand our operations;
|
•
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Inability of new products to gain distributor or market acceptance;
|
•
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Our inability to execute our product launch process due to increased pressure on our supply chain, information systems and management;
|
•
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Disruptions in our information technology systems;
|
•
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Inability to comply with financial covenants imposed by our credit facility;
|
•
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Inability to protect against cyber security risks and to maintain the integrity of data;
|
•
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The impact of our debt service obligations and restrictive debt covenants;
|
•
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Claims against us as a result of our independent distributors failing to comply with applicable legal requirements or our policies and procedures;
|
•
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International trade or foreign exchange restrictions, increased tariffs, foreign currency exchange;
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•
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Deterioration of global economic conditions;
|
•
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Inability to maintain appropriate level of internal control over financial reporting;
|
•
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Inability to raise additional capital if needed;
|
•
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Exposure to environmental liabilities stemming from past operations and property ownership;
|
•
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Significant dependence upon a few products for revenue;
|
•
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Inability to retain independent distributors or to attract new independent distributors on an ongoing basis;
|
•
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High quality material for our products may become difficult to obtain or expensive;
|
•
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Improper actions by our independent distributors that violate laws or regulations;
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•
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Dependence on third parties to manufacture our products;
|
•
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Disruptions to the transportation channels used to distribute our products;
|
•
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We may be subject to a product recall;
|
•
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Government regulations on direct selling activities may prohibit or severely restrict our business model;
|
•
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Unfavorable publicity on our business or products;
|
•
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Our direct selling program could be found to not be in compliance with current or newly adopted laws or regulations;
|
•
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Legal proceedings may be expensive and time consuming;
|
•
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Strict government regulations on our business;
|
•
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Regulations governing the production or marketing of our products;
|
•
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Risk of investigatory and enforcement action by the federal trade commission;
|
•
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Government authorities may question our tax positions or transfer pricing policies or change their laws in a manner that could increase our effective tax rate or otherwise harm our business;
|
•
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Failure to comply with anti-corruption laws;
|
•
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Inability to build and integrate our new management team could harm our business;
|
•
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Loss of, or inability to attract, key personnel;
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•
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We could be held responsible for certain taxes or assessments relating to the activity of our independent distributors;
|
•
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Competition in the dietary supplement market;
|
•
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Our inability to protect our intellectual property rights;
|
•
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Third party claims that we infringe on their intellectual property;
|
•
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Product liability claims against us;
|
•
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Economic, political, foreign exchange and other risks associated with international operations;
|
•
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Volatility of the market price of our common stock;
|
•
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Substantial sales of shares may negatively impact the market price of our common stock;
|
•
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Significant dilution of outstanding voting shares if holders of our existing warrants and options exercise their securities for shares of common stock;
|
•
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We have not paid dividends on our capital stock, and we do not currently anticipate paying dividends in the foreseeable future; and
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•
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Other factors not specifically described above, including the other risks, uncertainties, and contingencies described under “Business”, “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Items 1, 1A and 7 of our Annual Report on Form 10-K for the year ended June 30, 2015 and under "Risk Factors" in Part II, Item 1A of this Quarterly Report on Form 10-Q.
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PAGE
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Item 1.
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||
|
||
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||
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||
|
||
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
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||
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Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 3.
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||
Item 4.
|
||
Item 5.
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||
Item 6.
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||
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As of,
|
||||||
|
September 30, 2015
|
|
June 30, 2015
|
||||
(In thousands, except per share data)
|
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
13,686
|
|
|
$
|
13,905
|
|
Accounts receivable
|
1,144
|
|
|
1,031
|
|
||
Income tax receivable
|
2,811
|
|
|
2,179
|
|
||
Inventory
|
8,538
|
|
|
9,248
|
|
||
Current deferred income tax asset
|
1,086
|
|
|
1,117
|
|
||
Prepaid expenses and deposits
|
3,596
|
|
|
2,995
|
|
||
Total current assets
|
30,861
|
|
|
30,475
|
|
||
|
|
|
|
||||
Property and equipment, net
|
5,267
|
|
|
5,759
|
|
||
Intangible assets, net
|
1,845
|
|
|
1,879
|
|
||
Long-term deferred income tax asset
|
229
|
|
|
235
|
|
||
Other long-term assets
|
1,400
|
|
|
1,433
|
|
||
TOTAL ASSETS
|
$
|
39,602
|
|
|
$
|
39,781
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable
|
$
|
2,502
|
|
|
$
|
2,614
|
|
Commissions payable
|
6,450
|
|
|
6,505
|
|
||
Other accrued expenses
|
7,280
|
|
|
5,600
|
|
||
Current portion of long-term debt
|
11,723
|
|
|
11,141
|
|
||
Total current liabilities
|
27,955
|
|
|
25,860
|
|
||
|
|
|
|
||||
Long-term debt
|
|
|
|
||||
Principal amount
|
6,786
|
|
|
10,484
|
|
||
Less: unamortized discount and deferred offering costs
|
(1,767
|
)
|
|
(1,951
|
)
|
||
Long-term debt, net of unamortized discount and deferred offering costs
|
5,019
|
|
|
8,533
|
|
||
Other long-term liabilities
|
2,051
|
|
|
2,063
|
|
||
Total liabilities
|
35,025
|
|
|
36,456
|
|
||
Commitments and contingencies - Note 6
|
|
|
|
||||
Stockholders’ equity
|
|
|
|
||||
Preferred stock — par value $0.001 per share, 50,000 shares authorized, no shares issued or outstanding
|
—
|
|
|
—
|
|
||
Common stock — par value $0.001 per share, 250,000 shares authorized and 13,981 and 13,958 issued and outstanding as of September 30, 2015 and June 30, 2015, respectively
|
14
|
|
|
14
|
|
||
Additional paid-in capital
|
117,826
|
|
|
117,657
|
|
||
Accumulated deficit
|
(113,029
|
)
|
|
(114,095
|
)
|
||
Accumulated other comprehensive loss
|
(234
|
)
|
|
(251
|
)
|
||
Total stockholders’ equity
|
4,577
|
|
|
3,325
|
|
||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
39,602
|
|
|
$
|
39,781
|
|
|
For the Three Months Ended September 30,
|
||||||
|
2015
|
|
2014
|
||||
(In thousands, except per share data)
|
|
|
|
||||
Revenue, net
|
$
|
45,352
|
|
|
$
|
51,633
|
|
Cost of sales
|
6,975
|
|
|
5,679
|
|
||
Gross profit
|
38,377
|
|
|
45,954
|
|
||
Operating expenses:
|
|
|
|
||||
Commissions and incentives
|
22,043
|
|
|
24,574
|
|
||
Selling, general and administrative
|
13,663
|
|
|
13,615
|
|
||
Total operating expenses
|
35,706
|
|
|
38,189
|
|
||
Operating income
|
2,671
|
|
|
7,765
|
|
||
Other income (expense):
|
|
|
|
||||
Interest expense
|
(749
|
)
|
|
(808
|
)
|
||
Other income (expense), net
|
(216
|
)
|
|
203
|
|
||
Total other income (expense)
|
(965
|
)
|
|
(605
|
)
|
||
Income before income taxes
|
1,706
|
|
|
7,160
|
|
||
Income tax expense
|
(640
|
)
|
|
(2,444
|
)
|
||
Net income
|
$
|
1,066
|
|
|
$
|
4,716
|
|
Net income per share:
|
|
|
|
||||
Basic
|
$
|
0.08
|
|
|
$
|
0.33
|
|
Diluted
|
$
|
0.08
|
|
|
$
|
0.32
|
|
Weighted-average shares outstanding:
|
|
|
|
||||
Basic
|
13,709
|
|
|
14,228
|
|
||
Diluted
|
13,830
|
|
|
14,837
|
|
||
Other comprehensive income, net of tax:
|
|
|
|
||||
Foreign currency translation adjustment
|
17
|
|
|
57
|
|
||
Other comprehensive income, net of tax
|
17
|
|
|
57
|
|
||
Comprehensive income
|
$
|
1,083
|
|
|
$
|
4,773
|
|
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Deficit
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Total
|
|||||||||||||
|
Shares
|
|
Amount
|
|
||||||||||||||||||
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balances, June 30, 2015
|
13,958
|
|
|
$
|
14
|
|
|
$
|
117,657
|
|
|
$
|
(114,095
|
)
|
|
$
|
(251
|
)
|
|
$
|
3,325
|
|
Stock-based compensation
|
—
|
|
|
—
|
|
|
188
|
|
|
—
|
|
|
—
|
|
|
188
|
|
|||||
Exercise of options and warrants
|
—
|
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
|
—
|
|
|
(19
|
)
|
|||||
Issuance of shares related to restricted stock
|
43
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Shares canceled or surrendered as payment of tax withholding
|
(20
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
17
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,066
|
|
|
—
|
|
|
1,066
|
|
|||||
Balances, September 30, 2015
|
13,981
|
|
|
$
|
14
|
|
|
$
|
117,826
|
|
|
$
|
(113,029
|
)
|
|
$
|
(234
|
)
|
|
$
|
4,577
|
|
|
For the Three Months Ended September 30,
|
||||||
|
2015
|
|
2014
|
||||
(In thousands)
|
|
|
|
||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net income
|
$
|
1,066
|
|
|
$
|
4,716
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
531
|
|
|
585
|
|
||
Stock-based compensation
|
192
|
|
|
474
|
|
||
Amortization of deferred financing fees
|
104
|
|
|
61
|
|
||
Amortization of debt discount
|
81
|
|
|
48
|
|
||
Deferred income tax
|
37
|
|
|
—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Decrease / (increase) in receivables
|
(739
|
)
|
|
1,469
|
|
||
Decrease / (increase) in inventory
|
657
|
|
|
(2,379
|
)
|
||
Increase in prepaid expenses and deposits
|
(606
|
)
|
|
(1,467
|
)
|
||
Decrease in long-term assets
|
50
|
|
|
563
|
|
||
Increase / (decrease) in accounts payable
|
(109
|
)
|
|
1,392
|
|
||
Increase / (decrease) in accrued expenses
|
1,304
|
|
|
(379
|
)
|
||
Increase / (decrease) in other long-term liabilities
|
273
|
|
|
(21
|
)
|
||
Net Cash Provided by Operating Activities
|
2,841
|
|
|
5,062
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Purchase of equipment
|
(3
|
)
|
|
(236
|
)
|
||
Net Cash Used in Investing Activities
|
(3
|
)
|
|
(236
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Excess tax benefit from stock-based compensation
|
(19
|
)
|
|
—
|
|
||
Repurchase of company stock
|
—
|
|
|
(2,000
|
)
|
||
Payment on term loan
|
(3,116
|
)
|
|
(1,175
|
)
|
||
Exercise of options and warrants
|
—
|
|
|
35
|
|
||
Net Cash Used in Financing Activities
|
(3,135
|
)
|
|
(3,140
|
)
|
||
Foreign Currency Effect on Cash
|
78
|
|
|
62
|
|
||
(Decrease) Increase in Cash and Cash Equivalents:
|
(219
|
)
|
|
1,748
|
|
||
Cash and Cash Equivalents — beginning of period
|
13,905
|
|
|
20,387
|
|
||
Cash and Cash Equivalents — end of period
|
$
|
13,686
|
|
|
$
|
22,135
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
|
|
|
||||
Cash paid for interest
|
$
|
559
|
|
|
$
|
699
|
|
Cash paid for income taxes
|
$
|
1,207
|
|
|
$
|
372
|
|
|
September 30,
2015 |
|
June 30,
2015 |
||||
Finished goods
|
$
|
4,283
|
|
|
$
|
5,783
|
|
Raw materials
|
4,255
|
|
|
3,465
|
|
||
Total inventory
|
$
|
8,538
|
|
|
$
|
9,248
|
|
|
For the Three Months Ended September 30,
|
||||||
|
2015
|
|
2014
|
||||
Numerator:
|
|
|
|
||||
Net income
|
$
|
1,066
|
|
|
$
|
4,716
|
|
Denominator:
|
|
|
|
||||
Basic weighted-average common shares outstanding
|
13,709
|
|
|
14,228
|
|
||
Effect of dilutive securities:
|
|
|
|
||||
Stock awards and options
|
59
|
|
|
228
|
|
||
Warrants
|
62
|
|
|
381
|
|
||
Diluted weighted-average common shares outstanding
|
13,830
|
|
|
14,837
|
|
||
Net income per share, basic
|
$
|
0.08
|
|
|
$
|
0.33
|
|
Net income per share, diluted
|
$
|
0.08
|
|
|
$
|
0.32
|
|
Year Ending June 30,
|
Amount
|
||
2015 (remaining nine months ending June 30, 2016)
|
$
|
9,048
|
|
2016
|
9,461
|
|
|
|
$
|
18,509
|
|
|
Active Preferred Customers By Region
|
|
|
|
|
||||||||||||
|
September 30,
|
|
|
|
|
||||||||||||
|
2015
|
|
2014
|
|
Change from Prior Year
|
|
Percent Change
|
||||||||||
Americas
|
93,000
|
|
|
81.6
|
%
|
|
104,000
|
|
|
82.5
|
%
|
|
(11,000
|
)
|
|
(10.6
|
)%
|
Asia/Pacific
|
21,000
|
|
|
18.4
|
%
|
|
22,000
|
|
|
17.5
|
%
|
|
(1,000
|
)
|
|
(4.5
|
)%
|
|
114,000
|
|
|
100.0
|
%
|
|
126,000
|
|
|
100.0
|
%
|
|
(12,000
|
)
|
|
(9.5
|
)%
|
|
For the Three Months Ended September 30,
|
|
|
|||||||
|
2015
|
|
2014
|
|
% Change
|
|||||
Japan
|
$
|
8,593
|
|
|
$
|
12,194
|
|
|
(29.5
|
)%
|
Hong Kong
|
1,179
|
|
|
1,624
|
|
|
(27.4
|
)%
|
||
Other
|
854
|
|
|
1,359
|
|
|
(37.2
|
)%
|
||
Asia/Pacific Total
|
$
|
10,626
|
|
|
$
|
15,177
|
|
|
(30.0
|
)%
|
|
For the Three Months Ended September 30,
|
||||||
|
2015
|
|
2014
|
||||
Contractual interest expense:
|
|
|
|
||||
2013 Term Loan
|
$
|
559
|
|
|
$
|
699
|
|
Amortization of deferred financing fees:
|
|
|
|
||||
2013 Term Loan
|
104
|
|
|
61
|
|
||
Amortization of debt discount:
|
|
|
|
||||
2013 Term Loan
|
81
|
|
|
48
|
|
||
Other
|
5
|
|
|
—
|
|
||
Total interest expense
|
$
|
749
|
|
|
$
|
808
|
|
•
|
Have a consolidated EBITDA (as defined in the Financing Agreement) of at least
$14.5 million
for the four consecutive fiscal quarters ending
September 30, 2015
. Our consolidated EBITDA requirement increases over time to
$25.6 million
for the four consecutive fiscal quarters ending September 30, 2016 and each period of four consecutive fiscal quarters ending each December 31, March 31, June 30, and September 30 thereafter;
|
•
|
Have a total leverage ratio (as defined in the Credit Facility) of less than
1.50
to
1.00
for the quarter ended
September 30, 2015
. Our leverage ratio requirement decreases over time to
1.25
to
1.00
for the quarter ended
June 30, 2016
, and remains level thereafter;
|
•
|
Have a fixed charge ratio (as defined in the Credit Facility) of greater than
1.25
to
1.00
for the four consecutive fiscal quarters ending
September 30, 2015
; and
|
•
|
For the fiscal quarter ending
September 30, 2015
have no less than
$7.0 million
in unrestricted cash and cash equivalents at any time when the total leverage ratio is greater than 1.25 to 1.00, and for all fiscal quarters ending subsequent to
September 30, 2015
have no less than
$8.0 million
in unrestricted cash and cash equivalents at any time when the total leverage ratio is greater than 1.25 to 1.00.
|
|
|
|
Payments due by period
|
||||||||||||||||
Contractual Obligations
|
Total
|
|
Less than
1 year
|
|
1-3 years
|
|
3-5 years
|
|
Thereafter
|
||||||||||
Long-term debt obligations
|
$
|
18,509
|
|
|
$
|
11,723
|
|
|
$
|
6,786
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest on long-term debt obligations
|
1,427
|
|
|
1,172
|
|
|
255
|
|
|
—
|
|
|
—
|
|
|||||
Operating lease obligations
|
13,257
|
|
|
2,449
|
|
|
4,732
|
|
|
4,037
|
|
|
2,039
|
|
|||||
Total
|
$
|
33,193
|
|
|
$
|
15,344
|
|
|
$
|
11,773
|
|
|
$
|
4,037
|
|
|
$
|
2,039
|
|
|
LIFEVANTAGE CORPORATION
|
|
|
Date: November 4, 2015
|
/s/
Darren Jensen
|
|
Darren Jensen
Chief Executive Officer
(Principal Executive Officer)
|
|
|
Date: November 4, 2015
|
/s/
Mark Jaggi
|
|
Mark Jaggi
Chief Financial Officer
(Principal Financial Officer)
|
Exhibit No.
|
|
Document Description
|
|
Filed Herewith or Incorporate by Reference From
|
|
|
|
|
|
3.1(a)
|
|
Amended and Restated Articles of Incorporation and Statement of Correction to Amended and Restated Articles of Incorporation
|
|
Exhibit to 4.1 to Registration Statement on Form S-8 (File No. 333-200363) filed on November 19, 2014
|
|
|
|
|
|
3.1(b)
|
|
Articles of Amendment to the Amended and Restated Articles of Incorporation
|
|
Filed herewith
|
|
|
|
|
|
31.1
|
|
Certification of principal executive officer pursuant to Rule 13a-14(a)/15d-14(a)
|
|
Filed herewith
|
|
|
|
|
|
31.2
|
|
Certification of principal financial officer pursuant to Rule 13a-14(a)/15d-14(a)
|
|
Filed herewith
|
|
|
|
|
|
32.1*
|
|
Certification of principal executive officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
Filed herewith
|
|
|
|
|
|
32.2*
|
|
Certification of principal financial officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
Filed herewith
|
|
|
|
|
|
101
|
|
The following financial information from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2015 formatted in XBRL (extensible Business Reporting Language): (i) Unaudited Condensed Consolidated Balance Sheets at September 30, 2015 and June 30, 2015; (ii) Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income for the three months ended September 30, 2015 and 2014; (iii) Unaudited Condensed Consolidated Statement of Stockholders’ Deficit for the three months ended September 30, 2015; (iv) Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2015 and 2014; and (v) Notes to Unaudited Condensed Consolidated Financial Statements, tagged as blocks of text
|
|
Filed herewith
|
*
|
This certification is being furnished solely to accompany this report pursuant to 18 U.S.C. 1350, and is not being filed for purposes of Section 18 of the Exchange Act and is not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing
|
1.
|
I have reviewed this quarterly report on Form 10-Q of LifeVantage Corporation;
|
2.
|
Based on my knowledge, this 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 report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this 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 report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, 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 report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/
Darren Jensen
|
Darren Jensen
|
President and Chief Executive Officer
|
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of LifeVantage Corporation;
|
2.
|
Based on my knowledge, this 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 report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this 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 report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, 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 report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/
Mark Jaggi
|
Mark Jaggi
|
Chief Financial Officer
|
(Principal Financial Officer)
|
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 results of operations of the Company.
|
/s/
Darren Jensen
|
Darren Jensen
|
President and Chief Executive Officer
|
(Principal Executive Officer)
|
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 results of operations of the Company.
|
/s/
Mark Jaggi
|
Mark Jaggi
|
Chief Financial Officer
|
(Principal Financial Officer)
|