Utah
|
87-0398877
|
|
(State
or other jurisdiction of
incorporation
or organization)
|
(I.R.S.
employer
identification
number)
|
5225 Wiley Post Way, Suite 500
Salt Lake City, Utah
|
84116
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
N/A
|
(Former
name, former address and former fiscal year, if changed since last
report)
|
Larger
Accelerated Filer ¨
|
Accelerated
Filer ¨
|
Non-Accelerated
Filer x (Do
not check if a smaller reporting company)
|
Smaller
reporting company ¨
|
Page Number
|
||
Disclosure
Regarding Forward-Looking Statements
|
3
|
|
PART
I – FINANCIAL INFORMATION
|
||
Item
1
|
Financial
Statements
|
|
Condensed
Consolidated Financial Statements
|
||
Condensed
Consolidated Balance Sheets as of March 31, 2008 and June 30,
2007
|
4
|
|
Condensed
Consolidated Statements of Income for the three months ended March 31,
2008 and 2007 and the nine months ended March 31, 2008 and
2007
|
5
|
|
Condensed
Consolidated Statements of Cash Flows for the nine months ended March 31,
2008 and 2007
|
7
|
|
Notes
to Condensed Consolidated Financial Statements
|
9
|
|
Item
2
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
14
|
Item
3
|
Quantitative
and Qualitative Disclosures About Market Risk
|
21
|
Item
4
|
Controls
and Procedures
|
21
|
PART
II – OTHER INFORMATION
|
||
Item
1
|
Legal
Proceedings
|
23
|
Item
1A
|
Risk
Factors
|
23
|
Item
2
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
28
|
Item
3
|
Defaults
Upon Senior Securities
|
28
|
Item
4
|
Submission
of Matters to a Vote of Security Holders
|
28
|
Item
5
|
Other
Information
|
29
|
Item
6
|
Exhibits
|
29
|
Signatures
|
29
|
CLEARONE
COMMUNICATIONS, INC.
|
||||||||
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
||||||||
(in
thousands of dollars, except per share amounts)
|
||||||||
(unaudited)
|
(audited)
|
|||||||
March
31,
|
June
30,
|
|||||||
2008
|
2007
|
|||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 8,566 | $ | 2,782 | ||||
Marketable
securities
|
821 | 19,871 | ||||||
Accounts
receivable, net of allowance for doubtful accounts
|
7,005 | 8,025 | ||||||
of
$69 and $54, respectively
|
||||||||
Deposit,
Bond for Preliminary Injunction
|
908 | 0 | ||||||
Note
Receivable
|
85 | 163 | ||||||
Inventories,
net
|
7,318 | 7,263 | ||||||
Income
tax receivable
|
8 | 0 | ||||||
Deferred
income taxes
|
203 | 0 | ||||||
Prepaid
expenses
|
485 | 213 | ||||||
Total
current assets
|
25,399 | 38,317 | ||||||
Long-term
Securities
|
11,486 | 0 | ||||||
Property
and equipment, net
|
2,678 | 2,694 | ||||||
Intangible
Assets, net
|
49 | 0 | ||||||
Note
Receiveable - long-term
|
0 | 43 | ||||||
Other
assets
|
9 | 9 | ||||||
Total
assets
|
$ | 39,621 | $ | 41,063 | ||||
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 1,924 | $ | 1,745 | ||||
Accrued
taxes
|
0 | 660 | ||||||
Accrued
liabilities
|
2,372 | 1,874 | ||||||
Deferred
product revenue
|
4,206 | 4,872 | ||||||
Total
current liabilities
|
8,502 | 9,151 | ||||||
Deferred
rent
|
739 | 855 | ||||||
Deferred
income taxes, net
|
203 | 0 | ||||||
Other
long-term liabilities
|
1,040 | 619 | ||||||
Total
liabilities
|
10,484 | 10,625 | ||||||
Shareholders'
equity:
|
||||||||
Common
stock, par value $0.001, 50,000,000 shares authorized,
|
||||||||
10,444,810
and 10,861,920 shares issued and outstanding, respectively
|
10 | 11 | ||||||
Additional
paid-in capital
|
45,422 | 47,582 | ||||||
Accumulated
other comprehensive loss
|
(764 | ) | 0 | |||||
Accumulated
deficit
|
(15,531 | ) | (17,155 | ) | ||||
Total
shareholders' equity
|
29,137 | 30,438 | ||||||
Total
liabilities and shareholders' equity
|
$ | 39,621 | $ | 41,063 | ||||
See
accompanying notes to condensed consolidated financial
statements
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
March
31,
|
March
31,
|
March
31,
|
March
31,
|
|||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
Product
Revenue:
|
$ | 9,163 | $ | 9,355 | $ | 29,393 | $ | 28,873 | ||||||||
Cost
of goods sold
|
3,439 | 4,190 | 12,153 | 13,366 | ||||||||||||
Gross
profit
|
5,724 | 5,165 | 17,240 | 15,507 | ||||||||||||
Operating
expenses:
|
||||||||||||||||
Sales
& Marketing
|
1,640 | 2,004 | 4,820 | 5,711 | ||||||||||||
General
& administrative
|
1,183 | 763 | 5,276 | 2,260 | ||||||||||||
Research
and product development
|
1,701 | 1,848 | 5,134 | 5,782 | ||||||||||||
Total
operating expenses
|
4,524 | 4,615 | 15,230 | 13,753 | ||||||||||||
Operating
income
|
1,200 | 550 | 2,010 | 1,754 | ||||||||||||
Other
income (expense), net:
|
||||||||||||||||
Interest
income
|
283 | 572 | 893 | 1,163 | ||||||||||||
Other,
net
|
(87 | ) | 5 | (45 | ) | 66 | ||||||||||
Other
income, net:
|
196 | 577 | 848 | 1,229 | ||||||||||||
Income
from continuing operations before income taxes
|
1,396 | 1,127 | 2,858 | 2,983 | ||||||||||||
(Provision)
for income taxes
|
(335 | ) | (167 | ) | (955 | ) | (303 | ) | ||||||||
Income
from continuing operations
|
1,061 | 960 | 1,903 | 2,680 | ||||||||||||
Discontinued
operations:
|
||||||||||||||||
Income
from discontinued operations
|
- | - | - | 495 | ||||||||||||
Gain
(loss) on disposal of discontinued operations
|
- | 420 | 25 | (10 | ) | |||||||||||
Income
tax provision
|
- | (157 | ) | (9 | ) | (181 | ) | |||||||||
Income
from discontinued operations:
|
- | 263 | 16 | 304 | ||||||||||||
Net
income
|
$ | 1,061 | $ | 1,223 | $ | 1,919 | $ | 2,984 | ||||||||
See
accompanying notes to condensed consolidated financial
statements
|
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
March
31,
|
March
31,
|
March
31,
|
March
31,
|
|||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
Basic
earnings per common share from continuing operations
|
$ | 0.10 | $ | 0.09 | $ | 0.18 | $ | 0.23 | ||||||||
Diluted
earnings per common share from continuing operations
|
$ | 0.10 | $ | 0.09 | $ | 0.18 | $ | 0.23 | ||||||||
Basic
earnings per common share from discontinued operations
|
$ | - | $ | 0.02 | $ | 0.00 | $ | 0.03 | ||||||||
Diluted
earnings per common share from discontinued operations
|
$ | - | $ | 0.02 | $ | - | $ | 0.03 | ||||||||
Basic
earnings per common share
|
$ | 0.10 | $ | 0.11 | $ | 0.18 | $ | 0.25 | ||||||||
Diluted
earnings per common share
|
$ | 0.10 | $ | 0.11 | $ | 0.18 | $ | 0.25 | ||||||||
Basic
weighted average shares
|
10,651,352 | 10,994,607 | 10,818,205 | 11,705,853 | ||||||||||||
Diluted
weighted average shares
|
10,747,317 | 11,101,791 | 10,921,932 | 11,770,145 | ||||||||||||
See
accompanying notes to condensed consolidated financial
statements
|
Nine Months Ended
|
||||||||
March
31,
|
March
31,
|
|||||||
2008
|
2007
|
|||||||
Cash
flows from operating activities:
|
||||||||
Net
income from continuing operations
|
$ | 1,903 | $ | 2,680 | ||||
Adjustments
to reconcile net income from continuing operations
|
||||||||
to
net cash provided by (used in) operations:
|
||||||||
Depreciation
and amortization expense
|
580 | 678 | ||||||
Stock-based
compensation
|
551 | 658 | ||||||
(Recovery)
Write-off of inventory
|
(34 | ) | 499 | |||||
Loss
on disposal of assets and fixed assets write-offs
|
4 | 1 | ||||||
Provision
for doubtful accounts
|
15 | 1 | ||||||
Accounts
receivable
|
837 | 936 | ||||||
Deposit
- Bond
|
(908 | ) | - | |||||
Note
receivable - Ken-A-Vision
|
121 | (245 | ) | |||||
Inventories
|
(21 | ) | (838 | ) | ||||
Other
assets
|
(272 | ) | (43 | ) | ||||
Accounts
payable
|
348 | (651 | ) | |||||
Accrued
liabilities
|
497 | (737 | ) | |||||
Income
Taxes
|
(542 | ) | 3,696 | |||||
Other
liabilities
|
- | (55 | ) | |||||
Deferred
product revenue
|
(666 | ) | (760 | ) | ||||
Net
cash provided by continuing operating activities
|
2,413 | 5,820 | ||||||
Net
cash provided by discontinued operating activities
|
- | 47 | ||||||
Net
cash provided by operating activities
|
2,413 | 5,867 | ||||||
Cash
flows from investing activities:
|
||||||||
Purchase
of property and equipment
|
(684 | ) | (732 | ) | ||||
Purchase
of intellectual property
|
(49 | ) | - | |||||
Proceeds
from the sale of property and equipment
|
- | 60 | ||||||
Purchase
of marketable securities
|
(10,570 | ) | (22,650 | ) | ||||
Sale
of marketable securities
|
17,370 | 22,550 | ||||||
Net
cash provided by (used in) continuing investing activities
|
6,067 | (772 | ) | |||||
Net
cash provided by discontinued investing activities
|
16 | 822 | ||||||
Net
cash provided by (used in) investing activities
|
6,083 | 50 | ||||||
Cash
flows from financing activities:
|
||||||||
Proceeds
from common stock
|
591 | 36 | ||||||
Purchase
and retirement of stock
|
(3,370 | ) | (5,881 | ) | ||||
Tax
Benefit attributable to exercise of stock options
|
67 | - | ||||||
Net
cash used in financing activities
|
(2,712 | ) | (5,845 | ) | ||||
Net
increase in cash and cash equivalents
|
5,784 | 72 | ||||||
Cash
and cash equivalents at the beginning of the period
|
2,782 | 1,240 | ||||||
Cash
and cash equivalents at the end of the period
|
$ | 8,566 | $ | 1,312 | ||||
See
accompanying notes to condensed consolidated financial
statements
|
Nine Months Ended
|
||||||||
March
31,
|
March
31,
|
|||||||
2008
|
2007
|
|||||||
Supplemental
disclosure of cash flow information:
|
||||||||
Cash
paid for interest
|
$ | 2 | $ | 1 | ||||
Cash
paid (received) for income taxes
|
$ | 1,439 | $ | (3,176 | ) | |||
Supplemental
disclosure of non-cash financing activities:
|
||||||||
Exchanged
accounts receivable from a vendor with accounts payable to same
vendor
|
$ | 168 | $ | - | ||||
Increase
in accumulated deficit and income tax liability as a result of the
adoption of FIN48 (see Note 4)
|
$ | 295 | $ | - | ||||
Lease
incentive for Edgewater leasehold improvements
|
$ | - | $ | 1,049 | ||||
See
accompanying notes to condensed consolidated financial
statements
|
March 31,
|
June 30,
|
|||||||
2008
|
2007
|
|||||||
Raw
materials
|
$ | 135 | $ | 453 | ||||
Finished
goods
|
5,426 | 4,695 | ||||||
Consigned
inventory
|
1,757 | 2,115 | ||||||
Total
inventory
|
$ | 7,318 | $ | 7,263 |
Description
of Securities
|
Total
- All Less than 12 Months
|
|||||||
Fair
Value
|
Unrealized
Losses
|
|||||||
Auction
Rate Securities
|
11,486 | 764 |
3Q
2008
|
3Q 2007 | |||||||
Balance,
beginning of period
|
$ | - | $ | - | ||||
Unrealized
holding (losses), in equity securities
|
(764 | ) | - | |||||
Balance,
end of period
|
$ | (764 | ) | $ | - |
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||
March
31,
|
March
31,
|
March
31,
|
March
31,
|
|||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
Net
income
|
$ | 1,061 | $ | 1,223 | $ | 1,919 | $ | 2,984 | ||||||||
Other
comprehensive income (loss):
|
||||||||||||||||
Unrealized
gain (loss) on available-for-sale investment, net of taxes
|
(764 | ) | 0 | (764 | ) | 0 | ||||||||||
$ | 297 | $ | 1,223 | $ | 1,155 | $ | 2,984 |
Item
2.
|
MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
Deferred Revenue
|
Deferred Cost of Goods Sold
|
Deferred Gross Profit
|
||||||||||
March
31, 2008
|
$ | 4,206 | $ | 1,757 | $ | 2,449 | ||||||
December
31, 2007
|
4,980 | 1,859 | 3,121 | |||||||||
September
30, 2007
|
5,875 | 2,149 | 3,726 | |||||||||
June
30, 2007
|
4,872 | 2,115 | 2,757 | |||||||||
March
31, 2007
|
5,111 | 2,265 | 2,846 | |||||||||
December
31, 2006
|
4,711 | 2,166 | 2,545 | |||||||||
September
30, 2006
|
5,249 | 2,541 | 2,708 | |||||||||
June
30, 2006
|
5,871 | 2,817 | 3,054 |
·
|
Significant
underperformance relative to projected future operating
results;
|
·
|
Significant
changes in the manner of our use of the acquired assets or the strategy
for our overall business; and
|
·
|
Significant
negative industry or economic
trends.
|
CLEARONE
COMMUNICATIONS, INC.
|
||||||||||||||||||||||||||||||||
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||||||||||||||
(in
thousands of dollars, except per share amounts)
|
||||||||||||||||||||||||||||||||
Three Months Ended
|
Nine Months Ended
|
|||||||||||||||||||||||||||||||
March
31,
|
March
31,
|
March
31,
|
March
31,
|
|||||||||||||||||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||||||||||||||||||
%
of Revenue
|
%
of Revenue
|
%
of Revenue
|
%
of Revenue
|
|||||||||||||||||||||||||||||
Product
Revenue:
|
$ | 9,163 | 100% | $ | 9,355 | 100% | $ | 29,393 | 100% | $ | 28,873 | 100% | ||||||||||||||||||||
Cost
of goods sold
|
3,439 | 38% | 4,190 | 45% | 12,153 | 41% | 13,366 | 46% | ||||||||||||||||||||||||
Gross
profit
|
5,724 | 62% | 5,165 | 55% | 17,240 | 59% | 15,507 | 54% | ||||||||||||||||||||||||
Operating
expenses:
|
||||||||||||||||||||||||||||||||
Sales
& Marketing
|
1,640 | 18% | 2,004 | 21% | 4,820 | 16% | 5,711 | 20% | ||||||||||||||||||||||||
General
& administrative
|
1,183 | 13% | 763 | 8% | 5,276 | 18% | 2,260 | 8% | ||||||||||||||||||||||||
Research
and product development
|
1,701 | 19% | 1,848 | 20% | 5,134 | 17% | 5,782 | 20% | ||||||||||||||||||||||||
Total
operating expenses
|
4,524 | 49% | 4,615 | 49% | 15,230 | 52% | 13,753 | 48% |
·
|
meeting
required specifications and regulatory
standards;
|
·
|
meeting
market expectations for
performance;
|
·
|
hiring
and keeping a sufficient number of skilled
developers;
|
·
|
obtaining
prototype products at anticipated cost
levels;
|
·
|
having
the ability to identify problems or product defects in the development
cycle; and
|
·
|
achieving
necessary manufacturing
efficiencies.
|
·
|
unexpected
changes in, or the imposition of, additional legislative or regulatory
requirements;
|
·
|
unique
environmental regulations;
|
·
|
fluctuating
exchange rates;
|
·
|
tariffs
and other barriers;
|
·
|
difficulties
in staffing and managing foreign sales
operations;
|
·
|
import
and export restrictions;
|
·
|
greater
difficulties in accounts receivable collection and longer payment
cycles;
|
·
|
potentially
adverse tax consequences;
|
·
|
potential
hostilities and changes in diplomatic and trade relationships;
and
|
·
|
disruption
in services due to natural disaster, economic or political difficulties,
quarantines, transportation, or other restrictions associated with
infectious diseases.
|
·
|
statements
or changes in opinions, ratings, or earnings estimates made by brokerage
firms or industry analysts relating to the market in which we do business
or relating to us specifically;
|
·
|
disparity
between our reported results and the projections of
analysts;
|
·
|
the
shift in sales mix of products that we currently sell to a sales mix of
lower-gross profit product
offerings;
|
·
|
the
level and mix of inventory levels held by our
distributors;
|
·
|
the
announcement of new products or product enhancements by us or our
competitors;
|
·
|
technological
innovations by us or our
competitors;
|
·
|
success
in meeting targeted availability dates for new or redesigned
products;
|
·
|
the
ability to profitably and efficiently manage our supplies of products and
key components;
|
·
|
the
ability to maintain profitable relationships with our
customers;
|
·
|
the
ability to maintain an appropriate cost
structure;
|
·
|
quarterly
variations in our results of
operations;
|
·
|
general
consumer confidence or general market conditions or market conditions
specific to technology industries;
|
·
|
domestic
and international economic
conditions;
|
·
|
the
adoption of the new accounting standard, SFAS No. 123R, “Share-Based
Payments,” which requires us to record compensation expense for certain
options issued before July 1, 2005 and for all options issued or modified
after June 30, 2005;
|
·
|
our
ability to report financial information in a timely manner;
and
|
·
|
the
markets in which our stock is
traded.
|
Period
|
Total
Number of Shares Purchased
|
Average
Price Paid per Share
|
Total
Number of Shares Purchased as Part of Publicly Announced Plans or
Programs
|
Maximum
Number (or Approximate Dollar Value) of Shares that May be Purchased Under
the Plans or Programs (1)
|
January
1, 2008 – January 31, 2008
|
61,454
|
$4.94
|
61,454
|
$1,658,000
|
February
1, 2008 – February 28, 2008
|
121,677
|
$5.16
|
121,677
|
$1,030,000
|
March
1, 2008 – March 31, 2008
|
160,427
|
$4.83
|
160,427
|
$255,000
|
Total
|
343,558
|
343,558
|
(1)
|
On
August 30, 2007, the Company announced that its Board of Directors had
approved a stock buy-back program to purchase up $3,625,000 of the
Company’s common stock over the next 12 months in open market and private
block transactions. All repurchased shares will be immediately retired.
The stock buy-back program will expire on August 30,
2008.
|
Exhibit
|
SEC
Ref.
|
||
No.
|
No.
|
Title of Document
|
Location
|
31.1
|
31
|
Section
302 Certification of Chief Executive Officer
|
This
filing
|
31.2
|
31
|
Section
302 Certification of Chief Financial Officer
|
This
filing
|
32.1
|
32
|
Section
906 Certification of Chief Executive Officer
|
This
filing
|
32.2
|
32
|
Section
906 Certification of Chief Financial Officer
|
This
filing
|
CLEARONE
COMMUNICATIONS, INC.
|
||
May
13, 2008
|
By:
|
/s/ Zeynep Hakimoglu
|
Zeynep
Hakimoglu
|
||
President
and Chief Executive Officer
|
||
(Principal
Executive Officer)
|
||
May
13, 2008
|
By:
|
/s/ Greg A. LeClaire
|
Greg
A. LeClaire
|
||
Chief
Financial Officer
|
||
(Principal
Financial and Accounting Officer)
|
1.
|
I
have reviewed this quarterly report on Form 10-Q of ClearOne
Communications, Inc.;
|
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 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.
|
Date: May
13, 2008
|
By:
|
/s/ Zeynep Hakimoglu
|
Zeynep
Hakimoglu
|
||
President
and Chief Executive Officer
|
1.
|
I
have reviewed this quarterly report on Form 10-Q of ClearOne
Communications, Inc.;
|
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 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.
|
Date:
May 13, 2008
|
By:
|
/s/ Greg A. LeClaire
|
Greg
A LeClaire
|
||
Chief
Financial Officer
|
Date: May
13, 2008
|
By:
|
/s/ Zeynep Hakimoglu
|
Zeynep
Hakimoglu
|
||
Chairman,
President and Chief Executive
Officer
|
Date:
May 13, 2008
|
By:
|
/s/ Greg A. LeClaire
|
Greg
A. LeClaire
|
||
Chief
Financial Officer
|