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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Quarterly Report Under Section 13 of 15(d) of
the Securities Exchange Act of 1934
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For Quarter Ended March 31, 2003 Commission File Number 0-16397
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APPLIED SPECTRUM TECHNOLOGIES, INC.
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(Exact name of registrant as specified in its charter)
Minnesota 41-1419457
(State or other jurisdiction of IRS Employer
incorporation or organization) Identification Number
c/o Norwood Venture Corp.
65 Norwood Avenue
Upper Montclair, NJ 07043
Registrant's Telephone Number
Including Area Code
(973) 783-1117
Not Applicable
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(Former name, former address and former fiscal year,
if changed from last report)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 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 [_]
The number of shares of registrant's Common Stock, par value $.01 per share,
outstanding as of April 30, 2003, was 2,953,941.
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APPLIED SPECTRUM TECHNOLOGIES, INC.
INDEX
PAGE
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Part I. Financial Information
Item 1. Financial Statements (Unaudited)
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Statements of Operations for the three and six
months ended March 31, 2003 and 2002 ..................... 3
Balance Sheets as of March 31, 2003 and
September 30, 2002 ....................................... 4
Statements of Cash Flows for the six months
ended March 31, 2003 and 2002 ............................ 5
Notes to Financial Statements - March 31, 2003 ........... 6
Item 2. Management's Discussion and Analysis of
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Financial Condition and Results of Operations ............ 7
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Part II. Other Information ................................................ 8
Signature ................................................................. 9
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PART 1. FINANCIAL INFORMATION
APPLIED SPECTRUM TECHNOLOGIES, INC.
STATEMENT OF OPERATIONS (UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
MARCH 31 MARCH 31
------------------------------ ------------------------------
2003 2002 2003 2002
REVENUES
Net sales $ -- $ -- $ -- $ --
Sublicensing revenues -- -- -- --
Total revenues -- -- -- --
Cost of product sold -- -- -- --
------------ ------------ ------------ ------------
Gross profit -- -- -- --
General and
administrative expense 250 1,337 250 1,467
------------ ------------ ------------ ------------
Operating profit (loss) (250) (1,337) (250) (1,467)
Interest expense -- -- -- --
Interest income 61 127 150 319
Other income (expense) -- -- -- --
------------ ------------ ------------ ------------
Net profit (loss) $ (189) $ (1,210) $ (100) $ (1,148)
Net profit (loss) per share $ (0.00) $ (0.00) $ (0.00) $ (0.00)
Weighted average number of
shares outstanding 2,953,941 2,953,941 2,953,941 2,953,941
See notes to financial statements
3
APPLIED SPECTRUM TECHNOLOGIES, INC.
BALANCE SHEETS
(UNAUDITED)
MARCH 31, SEPTEMBER 30,
2003 2002
------------ ------------
ASSETS
CURRENT ASSETS
Cash $ 29,826 $ 33,422
Other -- --
------------ ------------
Total current assets 29,826 33,422
PROPERTY AND EQUIPMENT
Equipment at fair market value -- --
------------ ------------
$ 29,826 $ 33,422
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 8,034 $ 8,035
Other accrued expenses 15,131 18,626
------------ ------------
Total current liabilities $ 23,165 $ 26,661
SHAREHOLDERS' EQUITY
Common Stock, par value $.01 per share
authorized 10,000,000 shares, issued
and outstanding - 2,953,941 29,539 29,539
Additional paid-in capital 16,044,973 16,044,973
Accumulated deficit (16,075,851) (16,067,751)
------------ ------------
6,661 6,761
------------ ------------
$ 29,826 $ 33,422
See notes to financial statements
4
APPLIED SPECTRUM TECHNOLOGIES, INC.
STATEMENT OF CASH FLOWS
(UNAUDITED)
SIX MONTHS ENDED
MARCH 31
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2003 2002
------------ ------------
OPERATING ACTIVITIES
Net profit (loss) $ (100) $ (1,148)
Net cash flow from (used for)
working capital -- --
Net cash from operating activities (3,496) (1,148)
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INVESTING ACTIVITIES
Net cash from investing activities -- --
------------ ------------
FINANCING ACTIVITIES
Proceeds from issuance of stock -- --
------------ ------------
Net cash from financing activities -- --
INCREASE (DECREASE) IN CASH (3,596) (1,148)
Cash beginning of period 33,422 36,906
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CASH END OF PERIOD $ 29,826 $ 35,758
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See notes to financial statements
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APPLIED SPECTRUM TECHNOLOGIES, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE A -- BASIS OF PRESENTATION
The accompanying unaudited condensed financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. For further information, refer to the financial statements and
footnotes thereto included in the Company's annual report on Form 10-K for the
year ended September 30, 2002.
NOTE B -- WEIGHTED AVERAGE SHARES
Weighted average number of shares includes shares of common stock outstanding
during the period. Outstanding stock options and warrants are not included in
the loss per share calculations as they are considered anti-dilutive.
NOTE C -- SIGNIFICANT EVENTS
At a Special Shareholders' Meeting on November 17, 2000, the Shareholders
revoked the Plan of Dissolution. In August, 2001 a liquidating dividend of
approximately $229,000 was paid pro-rata to shareholders.
NOTE D -- OWNERSHIP
On January 20, 1995, Norwood Venture Corp. (Norwood), the Company's major
shareholder, exercised warrants to 957,877 shares of common stock at a price of
$.01 per share. Following the exercise, Norwood owned 2,282,564 shares or 77.27%
of the Company.
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APPLIED SPECTRUM TECHNOLOGIES, INC.
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OPERATIONS FOR THE THREE AND SIX MONTHS ENDED MARCH 31, 2003
- ------------------------------------------------------------
Revenues
- --------
The Company was inactive and had no sales revenue during the periods.
Expenses
- --------
General and Administrative expenses of $250 for the three and six month periods,
respectively, were for accounting services.
Interest Income
- ---------------
Interest income was $61 and $150 for the three and six month periods,
respectively.
Capital Resources and Liquidity
- -------------------------------
The Company's cash position was reduced by $3,596 during the six month period
due to the payment of accrued legal, filing and accounting expenses.
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PART II. OTHER INFORMATION
None.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Quarterly Report on Form 10-Q for the period
ended March 31, 2002 to be signed on its behalf by the undersigned thereunto
duly authorized.
APPLIED SPECTRUM TECHNOLOGIES, INC.
Date: May 14, 2003 /s/ Mark R. Littell
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Mark R. Littell
Chief Executive Officer
/s/ Mark R. Littell
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Mark R. Littell
Director
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CERTIFICATION PURSUANT TO SECTION 302 OF SARBANES-OXLEY ACT OF 2002
I, Mark R. Littell, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Applied Spectrum
Technologies, 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 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 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 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.
Date: May 14, 2003
/s/ Mark R. Littell
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Mark R. Littell
Chief Executive Officer
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CERTIFICATION PURSUANT TO SECTION 302 OF SARBANES-OXLEY ACT OF 2002
I, Mark R. Littell, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Applied Spectrum
Technologies, 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 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 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 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.
Date: May 14, 2003
/s/ Mark R. Littell
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Mark R. Littell
Chief Financial Officer
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