U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
-------------- ---------------
Commission File No. 333-60906
Two Moons Kachinas Corp.
------------------------
(Name of Small Business Issuer in its Charter)
NEVADA 87-0656515
------ ----------
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
9005 Cobble Canyon Lane
Sandy, Utah 84093
-----------------
(Address of Principal Executive Offices)
Issuer's Telephone Number: (801) 942-0555
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 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.
(1) Yes X No (2) Yes X No
--- --- --- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Not applicable.
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the Registrant's classes
of common stock, as of the latest practicable date:
September 30, 2002
579,800
-------
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Financial Statements of the Registrant required to be filed with
this 10-QSB Quarterly Report were prepared by management, and commence on the
following page, together with Related Notes. In the opinion of management,
the Financial Statements fairly present the financial condition of the
Registrant.
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
UNAUDITED CONDENSED FINANCIAL STATEMENTS
SEPTEMBER 30, 2002
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
CONTENTS
PAGE
Unaudited Condensed Balance Sheets,
September 30, 2002 and December 31, 2001 2
Unaudited Condensed Statements of Operations,
for the three and nine months ended September
30, 2002 and 2001 and for the period from
inception on May 19, 2000 through September 30, 2002 3
Unaudited Condensed Statements of Cash Flows,
for the nine months ended September 30, 2002 and 2001
and for the period from inception on May 19, 2000
through September 30, 2002 4
Notes to Unaudited Condensed Financial Statements 5 - 9
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
UNAUDITED CONDENSED BALANCE SHEETS
ASSETS
September 30, December 31,
2002 2001
___________ ___________
CURRENT ASSETS:
Cash $ 9,348 $ 22,441
Interest receivable 9 43
Inventory 70,500 54,000
Prepaid expenses 67 -
----------- ---------
Total Current Assets 79,924 76,484
PROPERTY AND EQUIPMENT, net 6,443 7,964
OTHER ASSETS:
Website development, net 245 445
----------- ---------
$ 86,612 $ 84,893
=========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,853 $ 693
Advances from shareholder 19,746 1,648
----------- ---------
Total Current Liabilities 22,599 2,341
----------- ---------
STOCKHOLDERS' EQUITY:
Common stock, $.001 par value,
50,000,000 shares authorized,
579,800 shares issued and
outstanding 580 580
Capital in excess of par value 93,355 93,355
Deficit accumulated during the
development stage (29,922) (11,383)
----------- ---------
Total Stockholders' Equity 64,013 82,552
----------- ---------
$ 86,612 $ 84,893
=========== =========
Note: The Balance Sheet as of December 31, 2001 was taken from the audited
financial statements at that date and condensed.
The accompanying notes are an integral part of these unaudited condensed
financial statements.
2
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
For the Three For the Nine From Inception
Months Ended Months Ended On May 19,
September 30, September 30, 2000 Through
September 30,
2002 2001 2002 2001 2002
REVENUE $ 3,300 $ - $ 3,300 $ - $ 3,300
COST OF GOODS SOLD 2,000 - 2,000 - 2,000
--------- --------- -------- ------ ---------
GROSS PROFIT 1,300 - 1,300 - 1,300
OPERATING EXPENSES:
Selling - - 4,748 - 4,748
General and
administrative 2,603 2,689 15,217 6,264 27,285
--------- --------- -------- ------ ---------
Total Operating
Expenses 2,603 2,689 19,965 6,264 32,033
--------- --------- -------- ------ ---------
LOSS FROM OPERATIONS (1,303) (2,689) (18,665) (6,264) (30,733)
OTHER INCOME:
Interest 26 19 126 91 811
--------- --------- -------- ------ ---------
Total Other Income 26 19 126 91 811
--------- --------- -------- ------ ---------
LOSS BEFORE INCOME TAXES (1,277) (2,670) (18,539) (6,173) (29,922)
CURRENT TAX EXPENSE - - - - -
DEFERRED TAX EXPENSE - - - - -
--------- --------- -------- ------ ---------
NET LOSS $ (1,277)$ (2,670) $(18,539)$(6,173) $ (29,922)
========= ========= ======== ====== =========
LOSS PER COMMON SHARE $ (.00)$ (.01) $ (.03) $ (.01) $ (.06)
========= ========= ======== ====== =========
The accompanying notes are an integral part of these unaudited condensed
financial statements.
3
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
NET INCREASE (DECREASE) IN CASH
For the Nine From Inception
Months Ended On May 19,
September 30, 2000 Through
September 30,
2002 2001 2002
Cash Flows From Operating Activities:
Net loss $ (18,539) $ (6,173) $ (29,922)
Adjustments to reconcile net loss
to net cash used by
operating activities:
Depreciation and amortization 1,721 1,542 4,016
Changes in assets and liabilities:
(Increase) decrease in
interest receivable 34 23 (9)
(Increase) in inventory (16,500) - (70,500)
(Increase) in prepaid expenses (67) - (67)
Increase in accounts payable 2,160 530 2,853
---------- ---------- ---------
Net Cash (Used) by
Operating Activities (31,191) (4,078) (93,629)
---------- ---------- ---------
Cash Flows From Investing Activities:
Purchase of property and equipment - - (10,171)
Payments for website development - (507) (533)
---------- ---------- ---------
Net Cash (Used) by
Investing Activities - (507) (10,704)
---------- ---------- ---------
Cash Flows From Financing Activities:
Advances from shareholder 18,098 1,460 19,746
Proceeds from issuance of
common stock - - 104,800
Payments for stock offering costs - (10,182) (10,865)
---------- ---------- ---------
Net Cash Provided by
Financing Activities 18,098 (8,722) 113,681
---------- ---------- ---------
Net Increase (Decrease) in Cash (13,093) (13,307) 9,348
Cash at Beginning of Period 22,441 14,063 -
---------- ---------- ---------
Cash at End of Period $ 9,348 $ 756 $ 9,348
========== ========== =========
Supplemental Disclosures of
Cash Flow Information:
Cash paid during the period for:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
Supplemental Schedule of Non-cash Investing and Financing Activities:
For the nine months ended September 30, 2002 and 2001:
None.
The accompanying notes are an integral part of these unaudited condensed
financial statements.
4
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - Two Moons Kachinas, Corp. ("the Company") was organized under
the laws of the State of Nevada on May 19, 2000. The Company has not yet
generated significant revenues from its planned principal operations and is
considered a development stage company as defined in Statement of Financial
Accounting Standards No. 7. The Company is planning to sell Hopi Kachina
Dolls and related artwork. The Company has, at the present time, not paid any
dividends and any dividends that may be paid in the future will depend upon
the financial requirements of the Company and other relevant factors.
Condensed Financial Statements - The accompanying financial statements have
been prepared by the Company without audit. In the opinion of management, all
adjustments (which include only normal recurring adjustments) necessary to
present fairly the financial position, results of operations and cash flows at
September 30, 2002 and 2001 and for the periods then ended have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles in the United States of America have been condensed or omitted. It
is suggested that these condensed financial statements be read in conjunction
with the financial statements and notes thereto included in the Company's
December 31, 2001 audited financial statements. The results of operations for
the periods ended September 30, 2002 and 2001 are not necessarily indicative
of the operating results for the full year.
Cash and Cash Equivalents - The Company considers all highly liquid debt
investments purchased with a maturity of three months or less to be cash
equivalents.
Inventory - Inventory is carried at the lower of cost or market using the
first in, first out method. At September 30, 2002, inventory consists of
twenty three Kachina dolls and related artwork valued at $70,500.
Property and Equipment - Property and equipment are stated at cost.
Expenditures for repairs and maintenance are charged to operating expense as
incurred. Expenditures for additions and betterments that extend the useful
lives of property and equipment are capitalized, upon being placed in service.
When assets are sold or otherwise disposed of, the cost and related
accumulated depreciation or amortization is removed from the accounts and any
resulting gain or loss is included in operations. Depreciation is computed
using the straight-line method over the estimated useful lives of the assets
of five years.
Website Costs - The Company has adopted the provisions of Emerging Issues Task
Force 00-2, "Accounting for Web Site Development Costs." Costs incurred in the
planning stage of a website are expensed as research and development while
costs incurred in the development stage are capitalized and amortized over the
life of the asset, estimated to be two years. As of September 30, 2002 the
Company has capitalized a total of $533 of website costs. The Company did not
incur any planning costs and did not record any research and development costs
for the nine months ended September 30, 2002 and 2001.
5
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Continued]
Revenue Recognition - The Company recognizes revenue upon delivery of the
product. Revenue derived from sales through art dealers and galleries is
recorded net of any commissions to the dealers or galleries.
Advertising Costs - Advertising costs, except for costs associated with
direct-response advertising, are charged to operations when incurred. The
costs of direct-response advertising are capitalized and amortized over the
period during which future benefits are expected to be received.
Loss Per Share - The computation of loss per share is based on the weighted
average number of shares outstanding during the period presented in accordance
with Statement of Financial Accounting Standards No. 128, "Earnings Per
Share".
Accounting Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities, the disclosures of contingent assets and
liabilities at the date of the financial statements, and the reported amount
of revenues and expenses during the reported period. Actual results could
differ from those estimated.
Recently Enacted Accounting Standards - Statement of Financial Accounting
Standards ("SFAS") No. 141, "Business Combinations", SFAS No. 142, "Goodwill
and Other Intangible Assets", SFAS No. 143, "Accounting for Asset Retirement
Obligations", SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets", SFAS No. 145, "Rescission of FASB Statements No. 4, 44,
and 64, Amendment of FASB Statement No. 13, and Technical Corrections", SFAS
No. 146, "Accounting for Costs Associated with Exit or Disposal Activities",
and SFAS No. 147, "Acquisitions of Certain Financial Institutions - an
Amendment of FASB Statements No. 72 and 144 and FASB Interpretation No. 9",
were recently issued. SFAS No. 141, 142, 143, 144, 145, 146 and 147 have no
current applicability to the Company or their effect on the financial
statements would not have been significant.
NOTE 2 - PROPERTY AND EQUIPMENT
The following is a summary of property and equipment at cost, less
accumulated depreciation as of:
September 30, December 31,
2002 2001
_____________ ___________
Computer and office equipment $ 10,171 $ 10,171
Less: accumulated depreciation (3,728) (2,207)
_____________ ___________
$ 6,443 $ 7,964
============= ===========
Depreciation expense for the nine months ended September 30, 2002 and 2001
amounted to $1,521 and $1,521, respectively.
6
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 3 - OTHER ASSETS
The following is a summary of other assets at cost, less accumulated
amortization as of:
September 30, December 31,
2002 2001
_____________ ____________
Website development $ 533 $ 533
Less: accumulated amortization (288) (88)
_____________ ____________
$ 245 $ 445
_____________ ____________
Amortization expense for the nine months ended September 30, 2002 and 2001
amounted to $200 and $21, respectively.
NOTE 4 - CAPITAL STOCK
Common Stock - During December 2000, in connection with its organization, the
Company issued 500,000 shares of its previously authorized, but unissued
common stock. The shares were issued for cash at $25,000 (or $.05 per share).
Public Stock Offering - During November 2001, the Company completed a public
stock offering of 79,800 shares of common stock for cash of $79,800 (or $1.00
per share). Stock offering costs of $10,865 were netted against the proceeds
as a reduction to capital in excess of par value. This offering was
registered with the Securities and Exchange Commission on Form SB-2.
NOTE 5 - INCOME TAXES
The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109 "Accounting for Income Taxes". SFAS
No. 109 requires the Company to provide a net deferred tax asset/liability
equal to the expected future tax benefit/expense of temporary reporting
differences between book and tax accounting methods and any available
operating loss or tax credit carryforwards. The Company has available at
September 30, 2002, operating loss carryforwards of approximately $32,300,
which may be applied against future taxable income and which expires in
various years through 2022.
The amount of and ultimate realization of the benefits from the operating loss
carryforwards for income tax purposes is dependent, in part, upon the tax laws
in effect, the future earnings of the Company, and other future events, the
effects of which cannot be determined. Because of the uncertainty surrounding
the realization of the loss carryforwards, the Company has established a
valuation allowance equal to the tax effect of the loss carryforwards and,
therefore, no deferred tax asset has been recognized for the loss
carryforwards. The net deferred tax assets are approximately $5,700 and
$3,900 as of September 30, 2002 and December 31, 2001, respectively, with an
offsetting valuation allowance of the same amount. The change in the
valuation allowance for the nine months ended September 30, 2002 is
approximately $1,800.
7
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 6 - RELATED PARTY TRANSACTIONS
Management Compensation - As of September 30, 2002, the Company has not paid
any compensation to any officer or director of the Company.
Office Space - The Company has not had a need to rent office space. An
officer/shareholder of the Company is allowing the Company to use his offices
as a mailing address, as needed, at no expense to the Company.
Advances from a shareholder - An officer/shareholder of the Company has made
advances to the Company and has directly paid expenses on behalf of the
Company. At September 30, 2002, the Company owed the shareholder $19,746. No
interest is being accrued on the advances.
NOTE 7 - GOING CONCERN
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles in the United States of America,
which contemplate continuation of the Company as a going concern. However,
the Company was recently formed and has not yet been successful in
establishing profitable operations. These factors raise substantial doubt
about the ability of the Company to continue as a going concern. In this
regard, management is proposing to raise any necessary additional funds not
provided by operations through loans or through additional sales of its common
stock. There is no assurance that the Company will be successful in raising
this additional capital or achieving profitable operations. The financial
statements do not include any adjustments that might result from the outcome
of these uncertainties.
NOTE 8 - LOSS PER SHARE
The following data shows the amounts used in computing loss per share:
For the Three For the Nine From Inception
Months Ended Months Ended On May 19,
September 30, September 30, 2000 Through
_________________________________ September 30,
2002 2001 2002 2001 2002
________________________________________________
Loss from
continuing operations
available to common
shareholders
(numerator) $(1,277) $(2,670) $(18,539) $(6,173) $ (29,922)
======= ======= ======== ======= =========
Weighted average
number of
common shares
outstanding
used in loss per
share for the
period (denominator) 579,800 500,000 579,800 500,000 530,500
======= ======= ======= ======= ========
Dilutive loss per share was not presented, as the Company had no common
stock equivalent shares for all periods presented that would affect the
computation of diluted loss per share.
8
TWO MOON KACHINAS, CORP.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 9 - CONCENTRATION
Significant Customer - During the nine months ended September 30, 2002, the
Company had one customer that accounted for all of the Company's revenues.
The loss of this significant customer could adversely affect the Company's
business and financial position.
9
Item 2. Management's Discussion and Analysis or Plan of Operation.
--------------------------------------------------------------------
Plan of Operation.
------------------
Our plan of operation for the next 12 months is to sell Kachina
dolls, both through our own web site and through Internet auction sites and
consignment to specialty stores.
At the time of our public offering, management estimated that we
would needed minimum cash resources of about $60,000 to begin material
operations. We determined that amount based on the following expected
expenses:
Costs of offering - $15,000;
Web design - $1,000;
Web maintenance - $1,500
Kachinas - $30,000;
Travel - $5,000;
Working Capital - $7,500.
Net proceeds of our public offering exceeded this amount by
approximately $10,000. We have not yet identified any other source of
funding, and we can not assure you that we will have any success in this
regard if additional resources are needed.
From our public offering proceeds, we hired a web site designer to
design our retail web site, which became operational in December, 2001. We
then purchased approximately 25 collector-quality Kachinas from jobbers, who
purchased Kachinas directly from the carvers, at below wholesale prices of
$1,200 to $1,800. In some cases, we will purchase Kachinas directly from
carvers in the $1,000 to $2,000 price range. Currently we have 23 Kachinas in
our inventory.
We have placed photographs of the Kachinas on our web site and, and
we may use auctions, with a minimum bid price, on Internet auction sites. We
also have contractual arrangements with two retail specialty stores, attended
the Spring 2002 San Francisco American Indian Arts Show that was held on March
23 and 24, 2002, and we are actively researching the availability of similar
events to showcase our products. In order to diversify our product offerings,
we also purchased a Zuni fetish, or carving, made of antlers.
As we sell Kachinas, we plan to use the proceeds to buy additional
Kachinas for resale. Our President provides us with rent-free office space,
and our management has verbally agreed not to accept any compensation until we
are operating profitably. Because of our low overhead, we believe that our
cash on hand will be sufficient to continue operations for the next 12 months.
Our officers have contacts through which they can purchase Kachinas at below
wholesale prices. We plan to keep our expenses low and to keep our inventory
rolling over.
Our officers are well-informed about Kachinas and plan to stay up-
to-date on current trends through reading industry publications, visiting
trade shows and communicating with personal contacts. We feel that the
$9,348 that we have in cash on hand and the sales of Kachina dolls will
provide us with sufficient working capital.
Results of Operations.
----------------------
During the quarterly periods ended September 30, 2002 and 2001, we
received total revenues of $3,300 and $0, respectively, and had a net losses
of $(1,277) and $(2,670), respectively.
During the nine months ended September 30, 2002 and 2001, we
received total revenues of $3,300 and $0, respectively, and had a net losses
of $(18,539) and $(6,173), respectively.
Liquidity.
----------
At September 30, 2002, we had $79,924 in current assets,
with total current liabilities of $22,599. Total stockholder's equity was
$64,013.
Forward-Looking Statement.
--------------------------
Statements made in this Form 10-QSB which are not purely historical
are forward-looking statements with respect to the goals, plan objectives,
intentions, expectations, financial condition, results of operations, future
performance and business of our Company, including, without limitation, (i)
our ability to gain a larger share of the kachina doll industry, our ability
to continue to develop products acceptable to the industry, our ability to
retain relationships with suppliers, our ability to raise capital, and the
growth of the Native American arts and crafts industry, and (ii) statements
preceded by, followed by or that include the words "may", "would", "could",
"should", "expects", "projects", "anticipates", "believes", "estimates",
"plans", "intends", "targets" or similar expressions.
Forward-looking statements involve inherent risks and uncertainties,
and important factors (many of which are beyond our Company's control) that
could cause actual results to differ materially from those set forth in the
forward-looking statements, including the following, in addition to those
contained in our Company's reports on file with the Securities and Exchange
Commission; general economic or industry conditions, nationally and/or in the
communities in which our Company conducts business, changes in the interest
rate environment, legislation or regulatory requirements, conditions of the
securities markets, changes in the Native American arts and crafts industry,
the development of products and that may be superior to the products and
services offered by our Company, demand for Kachina dolls, competition,
changes in the quality or composition of our Company's products, our ability
to raise capital, changes in accounting principles, policies or guidelines,
financial or political instability, acts of war or terrorism, other economic,
competitive, governmental, regulatory and technical factors affecting our
Company's operations, products, services and prices.
Accordingly, results actually achieved may differ materially from
expected results in these statements. Forward-looking statements speak only
as of the date they are made. Our Company does not undertake, and
specifically disclaims, any obligation to update any forward-looking
statements to reflect events or circumstances occurring after the date of such
statements.
Item 3. Controls and Procedures.
----------------------------------
(a) Evaluation of Disclosure Controls and Procedures
Two Moon's President and Secretary/Treasurer have evaluated the
company's disclosure controls and procedures as of November 7, 2002, and they
concluded that these controls and procedures are effective.
(b) Changes in Internal Controls
There are no significant changes in internal controls or in other
factors that could significantly affect these controls subsequent to November
7, 2002.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
----------------------------
None; not applicable.
Item 2. Changes in Securities.
--------------------------------
None; not applicable.
Item 3. Defaults Upon Senior Securities.
------------------------------------------
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
--------------------------------------------------------------
None; not applicable.
Item 5. Other Information.
----------------------------
None; not applicable.
Item 6. Exhibits and Reports on Form 8-K.
-------------------------------------------
(a) Exhibits.
None.
(b) Reports on Form 8-K.
None.
SIGNATURES
Pursuant to the requirements 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.
Two Moons Kachinas, Corp.
Date: 11/7/02 By /s/ David C. Merrell
-------------- -------------------------------------
David C. Merrell
President and Director
Date: 11/7/02 By /s/ R. Kip Paul
-------------- -------------------------------------
R. Kip Paul
Secretary, Treasurer and Director
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, David C. Merrell, President of Two Moons Kachinas Corp, certify
that:
1. I have reviewed this Quarterly Report on Form 10-QSB of Two Moons
Kachinas Corp;
2. Based on my knowledge, this Quarterly 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 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 officer 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 officer 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 officer 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.
Dated: November 11, 2002 Signature:/s/David C. Merrell
David C. Merrell
President
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, R. Kip Paul, Secretary/Treasurer of Two Moons Kachinas, Corp., certify
that:
1. I have reviewed this Quarterly Report on Form 10-QSB of Two Moons
Kachinas, Corp.;
2. Based on my knowledge, this Quarterly 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 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 officer 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 officer 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 officer 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.
Dated: November 11, 2002 Signature:/s/R. Kip Paul
R. Kip Paul
Secretary/Treasurer