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August 6, 2002
U.S. Securities and Exchange Commission
6432 General Green Way
Alexandria, VA 22312
Attn: File Support
Re: Holobeam, Inc. File No. 0-3385
Gentlemen:
Enclosed you will find one (1) paper format copy of Form 10Q
for the Quarter ended June 30, 2002, which has been previously
filed via the Edgar system.
Kindly acknowledge receipt by signing the enclosed copy of
this letter and returning it to us in the accompanying stamped,
self-addressed envelope.
Very truly yours,
William M. Hackett
Treasurer
mjb
Encs.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTER ENDED: June 30, 2002
COMMISSION FILE NUMBER: 0-3385
HOLOBEAM, INC.
(Exact name of Registrant as specified in its charter)
Delaware 22-1840647
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) I.D. Number
217 First Street, P.O. Box 287, Ho-Ho-Kus, New Jersey 07423-0287
(Address of principal executive offices) (Zip Code)
201-445-2420
(Registrant's telephone no., including area code)
(Former name, former address and former fiscal year, if changed
since last report)
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.
yes x no
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
285,897 Common Shares at August 4, 2002
HOLOBEAM, INC.
INDEX
PART I PAGE NO.
Financial Statements
Condensed Balance Sheets 1
Condensed Statements of Income 2
Condensed Statements of Cash Flows 3
Notes to Condensed Financial Statements 4
Management's Discussion and Analysis of
the Financial Condition and Results of
Operations 5 - 7
PART II
Signatures 8
Computation of Earnings Per Common Share Exhibit A
PART I
HOLOBEAM, INC.
Condensed Balance Sheets
ASSETS
June 30,2002 Sept. 30, 2001
Current Assets
Cash and Cash Equivalents $ 923,132 $ 924,463
Short Term Investments -0- -0-
Other Current Assets 46,111 72,305
---------- -----------
Total Current Assets 969,243 996,768
---------- -----------
Investments in Real Estate, Net 5,137,505 5,277,534
Machinery & Equipment, Net 80,110 43,960
Unbilled Accounts Receivable 1,155,880 1,155,880
Other Non-Current Assets 413,411 447,683
---------- ----------
Total Assets $7,756,149 $ 7,931,825
========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable $ 83,295 $ 24,894
Accrued Expenses 242,912 233,995
Income Taxes Payable -0- -0-
Current Portion of Mortgage Payable 405,278 379,611
---------- ----------
Total Current Liabilities 731,485 638,500
---------- ----------
Mortgage Payable, Net of Current
Portion 4,618,293 4,925,540
Deferred Income Taxes 462,352 462,352
---------- ----------
Total Liabilities 5,812,130 6,026,392
---------- ----------
Shareholders' Equity
Common Stock 30,559 30,559
Paid-In-Capital 9,825,498 9,825,498
Accumulated Deficit ( 7,585,743) ( 7,708,183)
Treasury Stock, At Cost ( 326,295) ( 242,441)
---------- ----------
Shareholders' Equity 1,944,019 1,905,433
---------- ----------
Total Liabilities and
Shareholders Equity $7,756,149 $7,931,825
========== ==========
1
HOLOBEAM, INC.
Condensed Statement of Income
Three Months Ended Nine Months Ended
June 30, June 30,
------------------ -----------------
2002 2001 2002 2001
---- ---- ---- ----
Revenue
Rental Income $496,105 $496,105 $1,488,313$1,488,313
Interest Income 2,990 9,343 10,781 39,246
Other -0- -0- -0- -0-
-------- -------- --------------------
Total Revenue 499,095 505,448 1,499,094 1,527,559
------- ------- --------- --------
Costs and Expenses
Rental Expenses 55,200 55,447 165,750 165,847
General & Admin. Expenses 209,438 185,576 619,599 556,603
Research & Development 50,292 44,055 165,511 139,262
Interest 112,670 119,208 344,173 365,814
Other 18 113 121 133
-------- -------- --------------------
Total Costs & Expenses 427,618 404,399 1,295,154 1,227,659
-------- -------- --------------------
Income (Loss) Before Income
Taxes 71,477 101,049 203,940 299,900
Income Tax Expense 28,585 40,355 81,500 119,780
-------- -------- --------------------
Net Income, (Loss) $ 42,892 $ 60,694 $ 122,440 $ 180,120
======== ======== ========= =========
Weighted Average Number of
Shares Outstanding 286,738 290547 288,379 291,110
Net Income (Loss) Per Share $0.15 $0.21 $0.43 $0.62
===== ===== ===== =====
2
HOLOBEAM, INC.
Condensed Statements of Cash Flows
Increase (Decrease) in Cash and Cash Equivalents
9 Months 9 Months 12 Months
Ended Ended Ended
6/30/02 6/30/01 9/30/01
------- ------- -------
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income, (Loss) $ 122,440 $ 180,120 $ 168,830
--------- --------- ---------
Adjustments to Reconcile Net
Income to Net Cash Provided
by Operating Activities:
Depreciation 158,963 158,963 209,890
Amortization 40,680 40,680 54,638
Decrease, (Increase) In:
Patent and Patent
Application Costs (6,407) (5,261) (7,933)
Accounts Receivable -0- -0- -15)
Unbilled Rents Receivable -0- -0- (33,486)
Prepaid Income Taxes -0- -0- (45,000)
Increase, (Decrease) In:
Accounts Payable and
Accrued Expenses 67,318 (132,930) (15,659)
Other 26,192 (15,578) 10,684
---------- ------- ---------
Total Adjustments 286,746 45,874 173,299
---------- --------------------
Net Cash Provided (Used) by
Operating Activities 409,186 225,994 342,129
---------- --------------------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital Expenditures (49,083) (27,224) (39,320)
Sale of Short Term Investments -0- 750,000 738,517
Sale of Capital Assets 4,000 -0- 11,100
---------- --------------------
Net Cash Flows from Investing
Activities (45,083) 722,776 710,297
------- --------------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Principal Payments on First
Mortgage (281,580) (258,055) (347,895)
Purchase of Treasury Stock (83,854) (30,468) (30,468)
Other -0- -0- -0-
---------- --------------------
Net Cash Flows Provided (Used)
by Financing Activities (365,434) (288,523) (378,363)
-------- -------- --------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (1,331) 660,247 674,063
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 924,463 250,400 250,400
---------- --------------------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 923,132 $ 901,647$ 924,463
========== ====================
3
HOLOBEAM, INC.
Notes to Condensed Financial Statements
Form 10Q
June 30, 2002
In the opinion of the Registrant, the accompanying unaudited,
condensed financial statements contain all adjustments, consisting
of routine, recurring accruals, necessary to present fairly its
financial position as of June 30, 2002 and 2001 and the results of
operations for the three months and nine months then ended and the
statement of cash flows for the nine months ended June 30, 2002 and
2001.
For purposes of reporting cash flows, all liquid investments
with maturities of three months or less are considered temporary
cash investments.
The results of operations for the three months and nine months
ended June 30, 2002 are not necessarily indicative of the results
of operations to be expected for a full year.
4
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
June 30, 2002
(1) Material Changes in Financial Condition
During the three months and nine months ended June 30,
2002, the Registrant's Working Capital decreased $18,100.00
and $102,410.00 respectively. Treasury Stock purchases for
the period totaled $83,854.00, representing a significant
factor in the reduction in Working Capital, while Capital
expenditures were $49,083.00.
Cash flows resulting from the Registrant's operating
activities increased $183,192.00 when compared to the nine
months ended June 30, 2001 and resulted in a net decrease in
cash and equivalents of $1,331.00 for the nine months ended
June 30, 2002.
The Registrant intends to continue funding the surgical
staples project for the balance of the current fiscal year.
Expenditures at June 30, 2002 were $165,511.00 and are
expected to approximate $250,000.00 at the end of the fiscal
year begun October 1, 2001. The continued funding of the
surgical staples and application project is not expected to
have any materially adverse effect upon the Registrant's
financial condition. Revenues from the
5
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
June 30, 2002
Registrant's real estate rental activities are expected to
provide the funds necessary to sustain support for the
project. (Reference is made to Annual Report, Form 10K, Item
7 for the years ended September 30, 1999, 2000 and 2001.)
(2) Material Changes in the Results of Operations
In the three months and nine months ended June 30, 2002,
the Registrant recorded after-tax income of $42,892.00 and
$122,440.00 respectively, representing decreases of $17,802.00
and $57,720.00 when compared to the same period one year ago.
Causal factors in the decrease include: (a) reduced interest
income on the Registrant's cash and equivalents resulting from
lower interest rates (the Registrant's cash and equivalents
are invested in money market funds); (b) increased costs and
expenses associated with Registrant's research and development
efforts; and (c) increases in administrative expenses
incidental to the Registrant's business activities.
It is the intention of the Registrant to continue
financial support for the surgical staples project until
6
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
June 30, 2002
the end of the year when a decision on the economic potential
of the staple will be made. The project has entered a final
phase of testing, which should yield definitive results by
December 31, 2002. At that time, the Registrant will decide
whether additional testing and funding will be committed to
the project. Funding for the project during the current
fiscal year amounted to $165,511.00 and is expected to be less
than $250,000.00 for the full fiscal year.
The Registrant also provided funding for its defined
benefit pension plan during the three months and nine months
ended June 30, 2002 in the amounts of $96,771.75 and
$290,315.00 respectively. Such contributions are expensed to
operations and are included on the administrative expenses for
statement purposes.
Continued funding of the Registrant's defined benefit
pension plan and the surgical staple project is not expected
to have any materially adverse effect upon the Registrant's
operations or financial condition.
7
PART II
HOLOBEAM, INC.
Signatures
Form 10Q
June 30, 2002
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.
Date: August 6, 2002
Holobeam, Inc.
Registrant
William M. Hackett
William M. Hackett
Treasurer and Director
Melvin S. Cook
Melvin S. Cook
President and Chairman of
the Board of Directors
Beverly Cook
Beverly Cook
Secretary and Director
Exhibit A
HOLOBEAM, INC.
Computation of Earnings Per Common Share
Form 10Q
June 30, 2002
Nine Months Ended
June 30
2002 2001
PRIMARY
Net Income (Loss) $122,440 $180,120
SHARES
Weighted Average Number of Common
Shares of Outstanding 288,379 291,110
Primary Earnings Per Share $0.43 $0.62