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: December 31, 2004
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, 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.
269,895 Common Shares at February 9, 2005
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, 6
PART II
Signatures 7
Certifications 8, 9, 10
Computation of Earnings Per Common Share Exhibit A
Section 906 Certifications Exhibit B
PART I
HOLOBEAM, INC.
Condensed Balance Sheets
ASSETS
Dec. 31, 2004 Sept. 30, 2004
------------- --------------
Current Assets
Cash and Cash Equivalents $ 849,104 $ 917,971
Short Term Investments -0- -0-
Other Current Assets 9,640 15,413
---------- ----------
Total Current Assets 858,744 933,384
Investments in Real Estate, Net 4,637,648 4,487,657
Machinery & Equipment, Net 38,438 43,543
Unbilled Accounts Receivable 1,012,958 1,055,818
Other Non-Current Assets 253,154 263,404
---------- ----------
Total Assets $6,800,942 $6,983,806
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable $ 185,429 $ 192,364
Accrued Expenses 228,910 227,791
Income Taxes Payable -0- 69,460
Current Portion of Mortgage Payable 504,052 493,177
---------- ----------
Total Current Liabilities 918,391 982,792
---------- ----------
Mortgage Payable, Net of Current
Portion 3,436,010 3,566,176
Deferred Income Taxes 422,327 422,327
---------- ----------
Total Liabilities 4,776,728 4,971,295
---------- ----------
Shareholders' Equity
Common Stock 27,121 27,121
Paid-In-Capital 9,137,868 9,137,868
Accumulated Deficit ( 7,113,775) ( 7,152,478)
Treasury Stock, At Cost ( 27,000) -0-
---------- ----------
Shareholders' Equity 2,024,214 2,012,511
---------- ----------
Total Liabilities and
Shareholders Equity $6,800,942 $6,983,806
========== ==========
1
HOLOBEAM, INC.
Condensed Statement of Income
3 Months Ended
December 31
2004 2003
Revenue
Rental Income $504,475 $504,475
Interest Income 1,445 1,480
Other -0- -0-
-------- --------
Total Revenue 505,920 505,955
Costs and Expenses
Rental Expenses 56,564 55,603
General and Administrative Expenses 296,430 225,613
Research and Development -0- -0-
Interest 88,422 98,461
Other 51 226
-------- --------
Total Costs and Expenses 441,467 379,903
-------- --------
Income Before Income Taxes 64,453 126,052
Income Tax Expense 25,750 50,345
-------- -------
Net Income $ 38,703 $ 75,707
======== ========
Weighted Average Number of Common
Shares Outstanding 270,513 273,420
Net Income Per Share $0.14 $0.28
2
HOLOBEAM, INC.
Condensed Statements of Cash Flows
Increase (Decrease) in Cash and Cash Equivalents
3 Months 3 Months 12 Months
Ended Ended Ended
12/31/04 12/31/03 9/30/04
-------- -------- -------
CASH FLOWS FROM OPERATING
ACTIVITIES
Net Income, (Loss) $ 38,703 $ 75,707 $ 184,936
---------- ---------- ---------
Adjustments to Reconcile Net
Income to Net Cash Provided
By Operating Activities:
Depreciation 55,115 54,250 220,366
Amortization 13,500 10,250 41,109
Loss on Abandonment of
Patents -0- -0- -0-
Decrease, (Increase) In:
Patent and Patent
Application Costs -0- -0- -0-
Accounts Receivable -0- -0- -0-
Unbilled Rents Receivable 42,860 15,691 62,763
Prepaid Income Taxes 3,522 6,341 (10)
Increase, (Decrease) In
Accounts Payable and
Accrued Expenses (75,276) 78,915 59,514
Other (1,000) 1,750 (33,292)
---------- ---------- ---------
Total Adjustments 38,721 167,197 350,450
---------- ---------- ---------
Net Cash Provided (Used) by
Operating Activities 77,424 242,904 535,386
---------- ---------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital Expenditures -0- -0- (3,529)
Purchase of Short Term
Investments -0- -0- -0-
Sale of Short Term
Investments -0- -0- -0-
--------- --------- ---------
Net Cash Flow from Investing
Activities -0- -0- (3,529)
--------- --------- ---------
CASH FLOW FROM FINANCING
ACTIVITIES:
Principal Payments on First
Mortgage (119,291) (109,325) (451,975)
Purchase of Treasury Stock (27,000) (67,657) (75,347)
Other -0- -0- -0-
---------- --------- ---------
Net Cash Flow Provided (Used)
by Financing Activities (146,291) (176,982) (527,322)
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (68,867) 65,922 4,535
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 917,971 913,436 913,436
---------- ---------- ----------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 849,104 $ 979,358 $ 917,971
========== ========== ==========
3
HOLOBEAM, INC.
Notes to Condensed Financial Statements
Form 10Q
December 31, 2004
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
December 31, 2004 and 2003 and the results of operations for the
three months then ended and the statement of cash flows for the
three months ended December 31, 2004.
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 ended
December 31, 2004 are not necessarily indicative of the results
to be expected for a full year.
4
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
December 31, 2004
(1) Material Changes in Financial Condition
Cash flows from operating activities for the three
months ended December 31, 2004 were $77,424.00, down
$165,480.00 when compared to the three months ended
December 31, 2003. The decrease resulted principally from
decreases in accounts payable and accrued expenses
amounting to $154,191.00.
Working capital at December 31, 2004 was $(59,647.00),
down $10,239.00 from that reported at September 30, 2004
and down $67,173.00 when compared to the working capital at
December 31, 2003.
During the three months ended December 31, 2004, the
Registrant purchased treasury stock in the amount of
$27,000.00 which negatively affected the Registrant's
working capital.
As previously reported, the Registrant intends to
identify opportunities for real estate development and
rental in the geographical vicinity of the Registrant's
existing rental properties in Bergen County, New Jersey.
In addition, the Registrant intends to investigate
processes for improving the sites presently owned by the
Registrant for purposes of attracting suitable tenants when
5
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
December 31, 2004
the existing operating leases expire in 2009 and 2012.
At the present time, no specific opportunities have
been identified and the Registrant intends to continue to
search for appropriate properties and improvement
processes. If the Registrant identifies suitable
opportunities, it is the intention of the Registrant to
fund the projects with the equity valuations contained in
the existing rental properties. Funding of any such
project is not expected to have a materially adverse effect
upon the Registrant's financial condition.
(2) Material Changes in the Results of Operations
During the quarter ended December 31, 2004, the
Registrant recorded after-tax income of $38,703.00, down
$37,004.00 when compared to the results of operations for
the three months ended December 31, 2003. The decrease in
income results principally from increases in general and
administrative expenses which are normal, recurring and
incidental to the Registrant's operations.
During the three months ended December 31, 2004, the
Registrant contributed $136,133.00 to the Registrant's
defined benefit pension plan. The contributions are
charged to operations and included in the administrative
expenses on the Condensed Statement of Income.
6
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
December 31, 2004
The Registrant expects to continue funding the plan in
subsequent periods and anticipates no materially adverse
effect upon the Registrant's financial condition.
7
PART II
HOLOBEAM, INC.
Signatures
Form 10Q
December 31, 2004
Signatures
Pursuant to the requirements of Section 13 or 15(d) 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.
Registrant Holobeam, Inc.
By William M. Hackett
Date February 11, 2005
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the Registrant and in the capacities and on the
dates indicated.
HOLOBEAM, INC.
By: Melvin S. Cook
Melvin S. Cook
President and Chairman of the Board
Date: February 11, 2005
By: William M. Hackett
William M. Hackett
Director and Treasurer
Date: February 11, 2005
By: Beverly Cook
Beverly Cook
Director and Secretary
Date: February 11, 2005
8
CERTIFICATIONS
(a) The Registrant maintains disclosure controls and
procedures that provide reasonable assurance that the
Registrant is able to record, process and summarize and
report the information required to comply with the
Registrant's Exchange Act disclosure obligations and for
the Registrant's own internal purposes. The Registrant has
evaluated these controls and procedures at September 31,
2004 and has determined the controls and procedures to be
effective in recording, processing, summarizing and
reporting the information required by the Registrant's
quarterly and annual Exchange Act reports.
(b) There have been no significant changes in the
Registrant's procedures or internal controls or in other
factors that could significantly affect these controls
subsequent to September 30, 2004, including corrective
actions with regard to significant deficiencies and
material weaknesses. As of December 31, 2004, the
examination of controls and procedures did not disclose
any significant deficiencies or material weaknesses.
I, William M. Hackett, Treasurer, certify that:
1. I have reviewed this quarterly report on Form 10-Q
of Holobeam, Inc.;
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,
9
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 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 officers and I
have indicated in this quarterly report whether 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.
Date: February 11, 2005
William M. Hackett,
Treasurer
William M. Hackett
Treasurer
I, Melvin S. Cook, President, certify that:
1. I have reviewed this quarterly report on Form 10-Q
of Holobeam, Inc.;
10
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 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
11
6. The Registrant's other certifying officers and I
have indicated in this quarterly report whether 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.
Date: February 11, 2005
Melvin S. Cook, President
Melvin S. Cook
President
12
Exhibit A
HOLOBEAM, INC.
Statement of Computation of Per Common Share Earnings
Form 10Q
DECEMBER 31, 2004
Three Months Ended
December 31,
------------------
2004 2003
---- ----
PRIMARY
Net Income $ 38,703 $ 75,707
SHARES
Weighted Average
Number of
Common
Shares of
Outstanding 270,513 273,420
Earnings Per
Share $0.14 $0.28