HOLOBEAM, INC.
217 First Street
P.O. Box 287
Ho-Ho-Kus, New Jersey 07423-0287
February 11, 2003
U.S. Securities and Exchange Commission
6432 General Green Way
Alexandria, VA 22312
Attn: File Support
Re: Holobeam, Inc. File No. 0-3385
Dear Sir or Madam:
Enclosed you will find one (1) paper format copy of Holobeam,
Inc. Quarterly Report Form 10Q for the quarter ended December 31,
2002 which has been previously filed/transmitted via the EDGAR
system.
Kindly acknowledge receipt by signing the enclosed photocopy
of this letter and return it to us in the enclosed stamped, self-
addressed envelope.
Very truly yours,
W. M. Hackett
Treasurer
mjb
Enc.
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, 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, 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.
294,985 Common Shares at January 31, 2003
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, 7
PART II
Signatures 8
Computation of Earnings Per Common Share Exhibit A
PART I
HOLOBEAM, INC.
Condensed Balance Sheets
ASSETS
Dec. 31, 2002 Sept. 30, 2002
Current Assets
Cash and Cash Equivalents $ 436,969 $ 836,042
Short Term Investments 288,506 -0-
Other Current Assets 50,593 54,597
----------- -----------
Total Current Assets 776,068 890,639
----------- -----------
Investments in Real Estate, Net 5,037,567 5,087,576
Machinery & Equipment, Net 74,732 76,113
Unbilled Accounts Receivable 1,165,654 1,181,345
Other Non-Current Assets 388,536 402,149
----------- ----------
Total Assets $ 7,442,557 $ 7,637,822
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable $ 63,371 $ 7,669
Accrued Expenses 285,315 279,346
Income Taxes Payable 33,265 -0-
Current Portion of Mortgage Payable 423,348 414,221
---------- ----------
Total Current Liabilities 805,299 701,236
---------- ----------
Mortgage Payable, Net of Current
Portion 4,402,004 4,511,321
Deferred Income Taxes 472,538 472,538
---------- ----------
Total Liabilities 5,679,841 6,685,095
---------- ----------
Shareholders' Equity
Common Stock 28,769 28,769
Paid-In-Capital 9,540,472 9,540,472
Accumulated Deficit ( 7,491,763) ( 7,541,784)
Treasury Stock, At Cost ( 314,762) ( 74,730)
---------- ----------
Shareholders' Equity 1,762,716 1,952,727
---------- ----------
Total Liabilities and
Shareholders Equity $7,442,557 $7,637,822
========== ==========
1
HOLOBEAM, INC.
Condensed Statement of Income
3 Months Ended
December 31
2002 2001
Revenue
Rental Income $504,475 $496,104
Interest Income 1,368 5,614
Other -0- -0-
-------- --------
Total Revenue 505,843 501,718
Costs and Expenses
Rental Expenses 57,790 55,350
General and Administrative Expenses 208,754 182,731
Research and Development 44,523 41,964
Interest 109,124 116,764
Other 2,366 -0-
-------- --------
Total Costs and Expenses 422,557 396,809
-------- --------
Income Before Income Taxes 83,286 104,909
Income Tax Expense 33,265 41,900
-------- -------
Net Income $ 50,021 $ 63,009
======== ========
Weighted Average Number of Common
Shares Outstanding 278,277 290,317
Net Income Per Share $0.18 $0.22
===== =====
2
HOLOBEAM, INC.
Condensed Statements of Cash Flows
Increase (Decrease) in Cash and Cash Equivalents
3 Months 3 Months 12 Months
Ended Ended Ended
12/31/02 12/31/01 9/30/02
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income, (Loss) $ 50,021 $ 63,009 $ 166,399
----------- ---------- ---------
Adjustments to Reconcile Net
Income to Net Cash Provided
by Operating Activities:
Depreciation 52,988 52,988 216,888
Amortization 14,909 12,260 55,535
Decrease, (Increase) In:
Patent and Patent
Application Costs ( 30)( 60)( 10,002)
Accounts Receivable -0- -0- ( 56)
Unbilled Rents Receivable 15,691 -0- ( 25,465)
Prepaid Income Taxes 33,265 ( 122,510)( 3,782)
Increase, (Decrease) In
Accounts Payable and
Accrued Expenses 61,671 219,534 28,126
Other 5,008 167 27,732
----------- ---------- ----------
Total Adjustments 183,502 162,379 288,976
----------- ---------- ----------
Net Cash Provided (Used) by
Operating Activities 233,523 225,388 455,375
----------- ---------- ----------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital Expenditures ( 1,596) -0- ( 49,082)
Purchase of Short Term
Investments ( 290,779) -0- -0-
Sale of Capital Assets -0- -0- 4,000
---------- --------- ----------
Net Cash Flows from Investing
Activities ( 292,375) -0- ( 45,082)
----------- --------- ----------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Principal Payments on First
Mortgage ( 100,190)( 91,820)( 379,609)
Purchase of Treasury Stock ( 240,031)( 12,225)( 119,105)
Other -0- -0- -0-
---------- --------- ----------
Net Cash Flows Provided (Used)
by Financing Activities ( 340,221)( 104,045)( 498,714)
----------- ---------- ----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS ( 399,073) 121,343 ( 88,421)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 836,042 924,463 924,463
----------- ---------- ----------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 436,969 $ 1,045,806 $ 836,042
=========== ========== ==========
3
HOLOBEAM, INC.
Notes to Condensed Financial Statements
Form 10Q
December 31, 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 December 31, 2002 and 2001 and the results
of operations for the three months then ended and the statement of
cash flows for the three months ended December 31, 2002.
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, 2002 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, 2002
(1) Material Changes in Financial Condition
Cash flows for the three months ended December 31, 2002
from operating activities, principally real estate rental
activities, were $293,375.00, up $67,987.00 from the three
months ended December 31, 2001.
During the three months ended December 31, 2002, the
Registrant's working capital decreased $218,634.00 to
($29,231.00). This decrease resulted primarily from the
Registrant's purchase of treasury stock amounting to
$240,031.00 during October 2002. The Registrant does not
anticipate any significant additional purchases of treasury
stock for the balance of the fiscal year.
It is the intention of the Registrant to continue funding
of the testing associated with the medical staples project.
(Reference is made to the Registrant's Annual Reports, Form
10K, Item 7 for the years ended September 30, 1998, 1999,
2000, 2001 and 2002.) During the quarter ended December 31,
2002, the Registrant incurred costs and expenses in connection
with the testing in the amount of $44,523.00. The Registrant
anticipates funding of the project for the balance of the
fiscal year begun October 21, 2002 will approximate
$206,000.00 and is not expected to have any materially adverse
effect upon the financial condition of the Registrant.
(2) Material Changes in the Results of Operations
5
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
December 31, 2002
The Registrant's after-tax income for the three months
ended December 31, 2002 was $50,021.00, which decreased
$12,988.00 when compared to the three months ended December
31, 2001. The decrease resulted from lower interest income
from the Registrant's cash equivalents, which are held in
money market funds, and from increases in costs that are
routine and incidental to the Registrant's real estate rental
activities.
As previously reported, the Registrant intends to
continue funding of the surgical staple project during the
fiscal year begun October 1, 2002.
Final tests are underway but there are no definitive
conclusions at this point. As soon as results are available,
the Registrant will decide upon additional commitments. If
the tests do not produce satisfactory results, the project
will be abandoned.
The Registrant spent $44,523.00 on the project during the
quarter ended December 31, 2002 and has budgeted an additional
$206,000.00 for the balance of the fiscal year in support of
the present testing phase. When definitive results are
obtained, the Registrant will decide upon additional financial
support for the project.
Further, the Registrant contributed approximately
$96,800.00 to the defined benefit pension plan during the
6
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
December 31, 2002
quarter ended December 31, 2002. The contributions are
charged to operations and included in administrative expenses
on the Condensed Statement of Income.
Funding of the surgical staples project and the continued
funding of the pension plan are not expected to have any
materially adverse effect upon the financial condition of the
Registrant.
7
PART II
HOLOBEAM, INC.
Signatures
Form 10Q
December 31, 2002
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, 2003
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, 2003
By: William M. Hackett
William M. Hackett
Director and Treasurer
Date: February 11, 2003
By: Beverly Cook
Beverly Cook
Director and Secretary
Date: February 11, 2003
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, 2002 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, 2002, including corrective actions with regard to
significant deficiencies and material weaknesses. As of December
31, 2002, 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,
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: 02/11/03
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.;
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
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: 02/11/03
Melvin S. Cook, President
Melvin S. Cook
President
Exhibit A
HOLOBEAM, INC.
Statement of Computation of Per Common Share Earnings
Form 10Q
DECEMBER 31, 2002
Three Months Ended
December 31,
2002 2001
PRIMARY
Net Income $ 50,021 $ 63,009
SHARES
Weighted Average Number of Common
Shares of Outstanding 278,277 290,317
Earnings Per Share $0.18 $0.22