exhibit991_10qsb-033103
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2003
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE TRANSITION PERIOD FROM _______________ TO _________________
Commission file number: 001-31679
TETON PETROLEUM COMPANY
(Exact Name of Small Business Issuer as Specified in its Charter)
Delaware 84-1482290
-------- ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
(970) 870-1417
(Issuer's Telephone Number)
1600 Broadway, Suite 2400
Denver, Colorado 80202-4921
(Address of Principal Executive Office)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such report), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
--- -----
Applicable only to corporate issuers:
As of May 12, 2003, 6,781,509 shares of the issuer's common stock were
outstanding.
Transitional Small Business Disclosure Format: Yes __ No X
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TETON PETROLEUM COMPANY
PART I. FINANCIAL INFORMATION
Table of Contents
Unaudited Consolidated Financial Statements
Consolidated Balance Sheets March 31, 2003 (Unaudited) and December 31, 2002
Unaudited Consolidated Statements of Operations and Comprehensive Loss Three months ended March 31, 2003 and 2002
Unaudited Consolidated Statements of Cash Flows Three months ended March 31, 2003 and 2002
Notes to Unaudited Consolidated Financial Statements
TETON PETROLEUM COMPANY
Consolidated Balance Sheets
December 31,
March 31, 2003 2002
------------ ------------
(Unaudited)
Assets
Current assets
Cash ........................................................ $ 405,765 $ 712,013
Proportionate share of Goloil accounts receivable ........... 796,242 642,525
Proportionate share of Goloil VAT and other accounts
receivable ................................................ 1,248,822 913,583
Stock subscriptions receivable .............................. 25,000 1,939,610
Proportionate share of Goloil inventory ..................... 483,885 502,989
Prepaid expenses and other assets ........................... 16,000 91,446
------------ ------------
Total current assets .................................... 2,975,714 4,802,166
------------ ------------
Non-current assets
Oil and gas properties, net (successful efforts) ............ 7,478,577 4,896,308
Fixed assets, net ........................................... 540,894 313,921
------------ ------------
Total non-current assets ................................ 8,019,471 5,210,229
------------ ------------
Total assets .................................................. $ 10,995,185 $ 10,012,395
============ ============
Liabilities and Stockholders' Deficit
Current liabilities
Accounts payable and accrued liabilities .................... $ 456,753 $ 650,356
Proportionate share of Goloil accounts payable and
accrued liabilities (Note 2) .............................. 2,539,287 1,534,344
Current portion of proportionate share of notes
payable owed to affiliate (Note 2) ........................ 2,844,711 2,441,424
------------ ------------
Total current liabilities ............................... 5,840,751 4,626,124
------------ ------------
Non-current liabilities
Proportionate share of notes payable advances owed to
affiliate ................................................. -- 507,001
------------ ------------
Total non-current liabilities ........................... -- 507,001
------------ ------------
Total liabilities ....................................... 5,840,751 5,133,125
------------ ------------
Commitments and contingencies
Stockholders' equity
Common stock, $0.001 par value, 250,000,000 and
100,000,000 shares authorized, 6,586,942 and
6,289,520 shares issued and outstanding at March
31, 2003 and December 31, 2002 ............................ 6,587 6,290
Additional paid-in capital .................................. 26,880,017 26,165,214
Accumulated deficit ......................................... (22,548,670) (22,022,734)
Foreign currency translation adjustment ..................... 816,500 730,500
------------ ------------
Total stockholders' equity .............................. 5,154,434 4,879,270
------------ ------------
Total liabilities and stockholders' equity .................... $ 10,995,185 $ 10,012,395
============ ============
See notes to unaudited consolidated financial statements.
TETON PETROLEUM COMPANY
Unaudited Consolidated Statements of Operations and Comprehensive Loss
For the Three Months Ended
March 31,
--------------------------
2003 2002
----------- -----------
Sales .......................................... $ 3,408,718 $ 821,000
Cost of sales and expenses
Oil and gas production ...................... 885,545 146,392
Transportation and marketing ................ 280,965 78,662
Taxes other than income taxes ............... 1,427,572 368,855
General and administrative - Goloil ......... 219,557 93,000
General and administrative - Teton Petroleum 772,899 562,311
Depreciation, depletion and amortization .... 170,737 24,000
----------- -----------
Total cost of sales and expenses .......... 3,757,275 1,273,220
----------- -----------
(Loss) income from operations .................. (348,557) (452,220)
----------- -----------
Other income (expense)
Other income ................................ 21,688 125
Financing charges ........................... -- (104,591)
Interest expense ............................ (94,225) (77,126)
----------- -----------
(72,537) (181,592)
----------- -----------
Net loss before taxes .......................... (421,094) (633,812)
Foreign income tax ............................. (104,842) --
Net loss ....................................... (525,936) (633,812)
Other comprehensive (loss) income, net of tax
Effect of exchange rates .................... 86,000 (42,000)
----------- -----------
Other comprehensive (loss) income .............. 86,000 (42,000)
----------- -----------
Comprehensive loss ............................. $ (439,936) $ (675,812)
=========== ===========
Basic and diluted weighted average common shares
outstanding ................................ 6,321,218 2,374,046
=========== ===========
Basic and diluted (loss) income per common share $ (0.08) $ (0.27)
=========== ===========
See notes to unaudited consolidated financial statements.
TETON PETROLEUM COMPANY
Unaudited Consolidated Statements of Cash Flows
For the Three Months Ended
March 31,
--------------------------
2003 2002
----------- -----------
Cash flows from operating activities
Net loss .......................................... $ (525,936) $ (633,812)
----------- -----------
Adjustments to reconcile net (loss) income to net
cash used in operating activities
Depreciation, depletion, and amortization ........ 170,737 24,000
Stock and stock options issued for services and
interest ........................................... -- 46,582
Amortization of note payable discount ............ -- 58,009
Changes in assets and liabilities
Accounts receivable ............................ (488,956) (334,000)
Prepaid expenses and other assets .............. 75,446 34,000
Inventory ...................................... 19,104 (23,500)
Accounts payable and accrued liabilities ....... 1,034,540 122,432
----------- -----------
810,871 (72,477)
----------- -----------
Net cash used in operating activities ......... 284,935 (706,289)
----------- -----------
Cash flows from investing activities
Oil and gas properties and equipment expenditures . (2,979,979) (128,044)
----------- -----------
Net cash used in investing activities ......... (2,979,979) (128,044)
----------- -----------
Cash flows from financing activities
Net (repayments) proceeds from advances under notes
payable from affiliate ............................ (103,714) 305,600
Proceeds from deposits on convertible debentures .. -- 1,071,500
Proceeds from issuance of stock, net of issue costs
of $98,100 .......................................... 2,406,510 --
Payments on notes payable ......................... -- (269,210)
----------- -----------
Net cash provided by financing activities ..... 2,302,796 1,107,890
----------- -----------
Effect of exchange rates ............................ 86,000 (10,065)
----------- -----------
Net (decrease) increase in cash ..................... (306,248) 263,492
Cash - beginning of year ............................ 712,013 182,502
----------- -----------
Cash - end of year .................................. $ 405,765 $ 445,994
=========== ===========
See notes to unaudited consolidated financial statements.
Supplemental disclosure of non-cash activity:
During 2003, the Company had the following transactions:
7,408 shares of stock were issued to a consultant for services valued at
$20,000 provided in 2001 and accrued in accounts payable.
73,422 shares of stock and 66,667 warrants exercisable at $6.00 were issued
to a consultant for services provided in 2002 valued at $200,000 and
accrued in accounts payable.
$25,000 of stock subscriptions receivable outstanding at March 31, 2003
were collected in April 2003.
During 2002, the Company had the following transactions:
In exchange for the extension of principal payments on four notes payable,
the Company modified expiration dates of certain warrants previously held
by the note holders and issued an additional 10,417 such warrants. The fair
value of the extension of the warrants and of the issued warrants totaled
$46,582 and has been included in financing costs.
TETON PETROLEUM COMPANY
Notes to Unaudited Consolidated Financial Statements
Note 1 - Basis of Presentation and Significant Accounting Policies
The March 31, 2003 financial statements are unaudited and reflect all
adjustments (consisting only of normal recurring adjustments), which are, in the
opinion of management, necessary for a fair presentation of the financial
position and operating results for the interim periods. The unaudited financial
statements as of March 31, 2003, as is customary in the oil and gas industry,
reflect a pro rata consolidation of the Company's 50% interest in ZAO Goloil, a
Russian closed joint-stock company. The unaudited financial statements contained
herein should be read in conjunction with the financial statements and notes
thereto contained in the Company's financial statement for the year ended
December 31, 2002. The results of operations for the period ended March 31, 2002
are not necessarily indicative of the results for the entire fiscal year.
Foreign Currency Exchange Rates
The consolidated financial statements reflect the Company's pro-rata share of
its subsidiary Goloil. The conversion of the functional currency of Goloil (a
Russian Company) in rubles to the reporting currency of U.S. dollars is based
upon the exchange rates in effect. The exchange rates in effect at March 31,
2003 and 2002 were 31.40 and 31.22 rubles to the U.S. dollar, respectively. The
average rates in effect during the three-month periods ended March 31, 2003 and
2002, were 31.67 and 30.84 rubles to the U.S. dollar, respectively.
Earnings Per Share
At the March 19, 2003 meeting, the Company's shareholders approved a reverse 1
for 12 stock split. All share amounts and earnings per share have been adjusted
to reflect the split.
All potential dilutive securities have an antidilutive effect on earnings (loss)
per share and accordingly, basic and dilutive weighted average shares are the
same.
Note 2 - Proportionate Share of Liabilities
The proportionate share of accounts payable and accrued liabilities of
$2,539,287 at March 31, 2003 are obligations of Goloil and not Teton Petroleum
nor have they been guaranteed by Teton Petroleum.
The following notes reflect the Company's 50% pro-rata share of notes payable
advances made of Goloil owed to an affiliate. These advances are also
obligations of Goloil at March 31, 2003 and not Teton Petroleum nor have they
been guaranteed by Teton Petroleum.
Pro-rata share of Goloil notes payable owed to an affiliate. The
proceeds were used to pay certain operating expenses and capital
expenditures of Goloil. These notes provide for interest rates of 8%,
with quarterly interest payments, maturing through February 2004.
These notes are secured by substantially all Goloil assets. The notes
payable will be repaid from cash flow from ZAO Goloil as available, or
extended to future periods. $ 2,844,711
-----------
Less current portion (2,844,711)
-----------
$ -
===========
Note 3 - Stockholder's Equity
In March 2003, the stockholder's approved an increase in the amount of
authorized common shares from 100,000,000 to 250,000,000 and also approved
25,000,000 of preferred stock authorized for future issuances.
During the quarter ended March 31, 2003, the Company received $466,900 of
proceeds (net of costs of $98,100) from the issuance of 207,416 shares of common
stock. The Company also issued 9,178 shares of common stock under a stock
subscription agreement for $25,000 that was collected in April of 2003. The
Company also received $1,939,610 during the quarter related to outstanding stock
subscriptions receivable at December 31, 2002.
The Company issued 1,009,870 warrants during the quarter in connection with the
private placement to investors. The Company also has an obligation to issue
58,498 warrants to an entity for its services directly related to raising
capital under private placements during the quarter.
FORWARD LOOKING STATEMENTS
To the extent that financial information and management's discussion and
analysis or plan of operation contain forward looking statements, such
statements involve risks and uncertainties which could cause Teton's actual
result to differ materially from the anticipated results discussed herein.
Factors that might cause such a difference are set forth in the "Significant
Factors in Company Operations" section of Teton's Registration Statement on Form
10-SB/A filed with the Securities and Exchange Commission ("SEC") on July 11,
2001 (SEC File Number: 000-31170) and in Teton's Annual Report on Form 10-KSB
filed with the SEC on April 15, 2003. You are cautioned not to place undue
reliance on the forward-looking statements made herein.
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
WITH THE EXCEPTION OF HISTORICAL MATTERS, THE MATTERS DISCUSSED HEREIN ARE
FORWARD LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES. FORWARD LOOKING
STATEMENTS INCLUDE, BUT ARE NOT LIMITED TO STATEMENTS CONCERNING ANTICIPATED
TRENDS IN REVENUES. OUR ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THE RESULTS
DISCUSSED IN SUCH FORWARD LOOKING STATEMENTS. THERE IS ABSOLUTELY NO ASSURANCE
THAT WE WILL ACHIEVE THE RESULTS EXPRESSED OR IMPLIED IN FORWARD LOOKING
STATEMENTS.
Results of Operations
Three Months Ended March 31, 2003 compared to March 31, 2002
The Company had revenues from oil and gas production of $3,408,718 for the three
months ended March 31, 2003 as compared to $821,000 for the three months ended
March 31, 2002. The change in sales is related to the increase in production
from 54,675 bbls. to 151,300 bbls., net to Teton after 50% production payment
and an increase in the average price per bbl. received from $15.00 to $22.53
from 2002 to 2003.
The cost of oil production, including export duties, increased to $885,545 for
the three months ended March 31, 2003 from $146,392 for the three months ended
March 31, 2002 due to the Company's increased production and significantly
higher per barrel export duties. The average cost per barrel of production,
excluding taxes, increased from $3.18 to $5.85. Of this increase, the change in
export duties accounted for $2.67 per barrel. A new insurance policy for
Goloil's oil pipeline also added to production costs. Teton's share of this cost
during the quarter amounted to $50,000 or $0.33 per bbl.
Transportation and marketing expenses rose from $78,662 for the three months
ended March 31, 2002 to $280,965 in the current quarter. The increase was due
mainly to the increased sales volume and increased transportation rates.
The average cost per bbl. of Russian taxes other than income increased from
$6.75 to $9.44 per bbl. This tax increase is due principally to an increase in
the Russian mining (extraction) tax, which is indexed to the world price of
Urals Blend crude and applied to all production, regardless of where sold.
Since Teton absorbs its share of the cost of producing the oil paid under the
production payment (included in the above cost amounts), the impact of changes
is doubled in the "net to Teton" per bbl. costs.
General and administrative expenses for Teton itself of $772,899 were incurred
for the three months ended March 31, 2003 as compared to $562,311 for the three
months ended March 31, 2002. The increase of general and administrative expenses
of $210,588 reflects the increase in consulting costs of approximately $42,000,
increase in travel and entertainment costs of approximately $100,000 and
increase in fees paid for research reports on Teton Petroleum of approximately
$85,000. The increase in consulting is a result of additional oil and gas
consultants used to assist with Company's Russian operations and financial
consultants involved in creating additional market awareness of the Company as
well as identifying additional sources for future capital raising.
Teton also absorbs it pro-rata share of Goloil's G&A expense. Because of the
significant increase in activity, Goloil's G&A expenses increased and Teton's
share of the increase was $126,557.
With the increased activity, including the addition of executive personnel
mentioned below, it is now anticipated Teton's General and Administrative
expenses will be higher than the $2,000,000 budget disclosed in our previously
filed 10-KSB for the year ended December 31, 2002.
Interest expense for the three months ended March 31, 2003 was $94,225 as
compared to $77,126 for the three months ended March 31, 2002. This interest
expense is principally from the pro-rata consolidation of Teton's ownership
portion of Goloil's loans. Financing charges in 2002 arose from the issuance of
Convertible Debt and warrants, which were recorded at "fair value", there were
none of these charges in 2003.
Liquidity and Capital Resources
The Company has cash balances of $405,765 at March 31, 2002, with a working
capital deficit of $2,865,037. Approximately $460,000 of the working capital
deficit is in Teton, with the remainder arising from the pro-rata consolidation
of Goloil. Teton is not liable for Goloil's debts. Cash flow from operations
totaled $284,935, with non-cash adjustments to cash flow from operations of
$810,871 including depreciation and depletion of $170,737.
The Company used $2,979,979 of cash in investing activities, which was all
associated with oil and gas property and equipment expenditures. In particular,
the Company financed its half of a new gas-powered electrical generating plant
in the amount of $1,500,000 which will be operational in the third quarter of
this year. The plant will provide substantial increases in electrical capacity
as compared to the diesel generators that will be replaced and at a lower cost.
The plant will be fueled by natural gas from our wells, reducing or eliminating
the need to "flare" the gas. The Company financed the expenditures with existing
cash and sale of Common Stock. The Company continues to expect significant
additional investments to be made in the future to drill and develop additional
producing wells.
The Company had cash provided by financing activities of $2,302,796, which
consisted of $2,406,510 from the sale of Common Stock, which were partially
offset by the repayment of notes payable to affiliate of $103,714.
The Company anticipates future operations and significant oil and gas property
expenditures will be able to be funded through a combination of note payable
advances from an affiliate, cash raised from raising debt and equity financing
and production of oil and gas reserves.
Other Matters:
The Company developed a plan of action to list its stock on the American Stock
Exchange (AMEX) and began implementation in the first quarter of 2003. The
program included the implementation of a 12 for 1 reverse stock split as well as
a listing. This program was successfully completed May 6, 2003.
The Company is currently exploring possibilities to acquire additional petroleum
licenses in Russia.
Subsequent Events:
In April of 2003, H. Howard Cooper, Chairman and CEO and the Board of Directors
concluded that the Chairman position and the CEO position should be separated
for workload considerations as the growth of the Company warrants additional
executive time and attention. Karl F. Arleth, a Director, joined the Company
full-time, as President and CEO. Mr. Arleth is an experienced oil & gas
executive with substantial experience in Russia and the ex-Soviet states. Mr.
Cooper will continue as a full-time executive Chairman focusing on the financing
of the growth of the Company as well as a search for additional petroleum
licenses in Russia.
In addition, Thomas F. Conroy, currently Chief Financial Officer, Secretary and
Director, informed the Board that he could not increase his time commitment to
Teton as required by the Company's growth, and would need to be replaced as
Chief Financial Officer. Mr. Conroy agreed to remain in his current position
until an orderly transition could be made. Mr. Conroy will remain as an outside
Director after the transition is completed.
On May 12, the Company announced that Mr. John J. Mahar, Managing Director of
Gladstone Capital, LLC in New York would assume the role of Chief Financial
Officer effective May 20, replacing Mr. Conroy. Mr. Mahar brings ten years of
experience in the financing of oil and gas projects, and a total of twenty-five
years of experience in the general financial sector.
ITEM 3. CONTROLS AND PROCEDURES
As of March 31, 2003, an evaluation was performed under the supervision and with
the participation of the Company's management, including the Chief Executive
Officer and the Chief Accounting Officer, of the effectiveness of the design and
operation of the Company's disclosure controls and procedures. Based on that
evaluation, the Company's management, including the Chief Executive Officer and
the Chief Accounting Officer, concluded that the Company's disclosure controls
and procedures were effective as of March 31, 2003. There have been no
significant changes in the Company's internal controls or in other factors that
could significantly affect internal controls subsequent to March 31, 2003.
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not applicable.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
On March 19, 2003, Teton's shareholders approved a reverse 1 for 12 stock split.
All share amounts have been adjusted to reflect the split.
The securities described below represent our securities sold by us for the
period starting January 1, 2002 and ending March 31, 2003 that were not
registered under the Securities Act of 1933, as amended, all of which were
issued by us pursuant to exemptions under the Securities Act. Underwriters were
involved in none of these transactions.
PRIVATE PLACEMENTS OF COMMON STOCK AND WARRANTS FOR CASH
Not applicable
SALES OF DEBT AND WARRANTS FOR CASH
Not applicable.
OPTION GRANTS
Not applicable.
ISSUANCES OF STOCK FOR SERVICES OR IN SATISFACTION OF OBLIGATIONS
On January 14, 2003, we issued the following shares of our common stock to the
following parties for services rendered:
1. 20,191 shares of common stock and 18,334 warrants exercisable at $6.00 to
Rockwell Capital Ventures in consideration of $55,000 for capital raising
services rendered.
2. 406 shares of common stock to Ivy L. Frederick in consideration of $12,000
for capital raising services rendered.
3. 380 shares of common stock to John P. O'Shea in consideration of $11,250
for capital raising services rendered.
4. 76 shares of common stock to Henry S. Kraus in consideration of $2,250 for
capital raising services rendered.
5. 76 shares of common stock to Daniel Luskind in consideration of $2,250 for
capital raising services rendered.
6. 76 shares of common stock to Arthur Niebaur in consideration of $2,250 for
capital raising services rendered.
On January 22, 2003, we issued 44,052 shares of our common stock and 40,000
warrants exercisable at $6.00 to Current Capital Corporation in consideration of
$120,000 for capital raising services rendered.
On March 23, 2003, we issued 7,408 shares of our common stock to Karl F. Arleth,
our director, in consideration of $20,000 for services rendered.
On March 27, 2003, we issued 6,898 shares of our common stock and 6,274 warrants
exercisable at $6.00 to Ilia Gurevich in consideration of $18,790 for consulting
services rendered.
On March 27, 2003, we issued 11,013 shares of our common stock and 10,000
warrants exercisable at $6.00 to Maxim Partners in consideration of $30,000 for
financial services rendered.
On March 28, 2003, we issued 73,422 shares of our common stock and 66,667
warrants exercisable at $6.00 to Strategic Partners Ltd. in consideration of
$200,000 for capital raising services rendered.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
1. The Annual Meeting was on March 19, 2003 at 5:00 PM.
2. There were present in person or by proxy 45,204,977 shares of Common Stock,
of a total of 69,423,319 shares of Common Stock entitled to vote.
3. The number of shares voted in favor of the election of the following
nominees for director is set forth opposite each nominee's name:
Nominee No. of Shares
------- -------------
H. Howard Cooper 45,089,762
Thomas F. Conroy 45,204,975
Karl F. Arleth 45,225,709
James J. Woodcock 45,204,977
4. 34,739,525 shares were voted in favor of the amendment of the Company's
Certificate of Incorporation to increase the authorized number of shares of
common stock from 100,000,000 shares to 250,000,000 shares and creation of
25,000,000 shares of blank check preferred.
5. 34,363,240 shares were voted in favor of 2003 Stock Option Plan.
6. 43,914,680 shares were voted in favor of the 1 for 12 reverse stock split.
7. 45,106,056 shares were voted in favor of the appointment of Ehrhardt Keefe
Steiner & Hottman PC as auditors.
ITEM 5. OTHER INFORMATION
Not Applicable.
ITEM 6. EXHIBITS AND REPORTS ON 8-K:
99.1 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
99.2 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
SIGNATURES
In accordance with the requirements of the Exchange Act of 1933, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
TETON PETROLEUM COMPANY, a Delaware Corporation
Date: May 15, 2003 By: /s/Karl F. Arleth
-----------------
Karl F. Arleth, President and CEO
Date: May 15, 2003 By: /s/Thomas F. Conroy
-------------------
Thomas F. Conroy, CFO
CERTIFICATION
I, Karl F. Arleth, CEO, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Teton Petroleum
Company;
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 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 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 functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
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.
May 15, 2003
/s/ Karl F. Arleth
-----------------------
Karl F. Arleth
Chief Executive Officer
CERTIFICATION
I, Thomas F. Conroy, CFO, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Teton Petroleum
Company;
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 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 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 functions):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
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.
May 15, 2003
/s/ Thomas F. Conroy
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Thomas F. Conroy
Chief Financial Officer