August 13, 1999
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, 1999, 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.
<PAGE>
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, 1999
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.
297,393 Common Shares at August 6, 1999
<PAGE>
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
<PAGE>
PART I
HOLOBEAM, INC.
Condensed Balance Sheets
ASSETS
June 30,1999 Sept. 30,1998
------------ -------------
Current Assets
Cash and Cash Equivalents $ 789,931 $ 301,623
Short Term Investments -0- 421,282
Other Current Assets 4,892 13,915
------- -------
Total Current Assets 794,823 736,820
Investments in Real Estate, Net 5,737,381 5,887,410
Machinery & Equipment, Net 40,570 44,771
Deferred Tax Asset -0- -0-
Other Non-Current Assets 552,233 586,081
--------- --------
Total Assets $ 7,125,007 $ 7,225,082
========== =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable $ 37,544 $ 6,832
Accrued Expenses 67,665 109,937
Income Taxes Payable 21,898 5,580
Current Portion of Long Term Debt 311,951 292,195
-------- ---------
Total Current Liabilities 439,058 414,544
Mortgage Payable, Net of Current
Portion 5,735,380 5,971,869
Real Estate Commissions Payable 12,133 12,133
--------- ---------
Total Liabilities 6,186,571 6,398,546
Shareholders' Equity
Common Stock 30,559 30,559
Paid-In-Capital 9,825,498 9,825,498
Accumulated Deficit ( 8,791,944) ( 8,947,666)
Treasury Stock, At Cost ( 125,677) ( 51,855)
------------ ----------
Shareholders' Equity 938,436 856,536
----------- ---------
Total Liabilities and
Shareholders Equity $ 7,125,007 $7,355,082
=========== ==========
1
<PAGE>
HOLOBEAM, INC.
Condensed Statement of Income
Three Months Ended Nine Months Ended
June 30, June 30,
--------------------- ---------------------
1999 1998 1999 1998
---- ---- ---- ----
Revenue
Rental Income $472,480 $472,480 $1,433,188 $1,417,438
Interest Income 7,958 12,918 23,766 32,723
Other -0- -0- -0- 50
--------- ------- --------- --------
Total Revenue 480,438 485,398 1,456,954 1,450,211
-------- ------- --------- ---------
Costs and Expenses
Rental Expenses 55,583 56,101 165,709 166,090
General & Admin. Expenses 155,356 390,991 467,793 552,629
Research & Development 54,552 45,227 156,332 159,451
Interest 133,175 140,925 407,438 427,121
Other -0- -0- 360 -0-
-------- -------- --------- ---------
Total Costs & Expenses 398,666 633,244 1,197,632 1,305,291
-------- -------- --------- ---------
Income (Loss) Before Income
Taxes 81,772 (147,846) 259,322 144,820
Income Tax Expense 32,685 ( 67,889) 103,600 58,000
------- -------- ------- ------
Net Income, (Loss) $ 49,087 $( 79,957) $ 155,722 $ 86,920
====== ======= ======= =======
Weighted Average Number of
Shares Outstanding 297,512 303,325 298,332 304,930
Net Income (Loss) Per Share $0.16 $(0.26) $0.52 $0.29
====== ====== ===== =====
2
<PAGE>
HOLOBEAM, INC.
Condensed Statements of Cash Flows
Increase (Decrease) in Cash and Cash Equivalents
9 Months 9 Months 12 Months
Ended Ended Ended
6/30/99 6/30/98 9/30/98
-------- -------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income, (Loss) $ 155,722 $ 86,920 $ 166,891
Adjustments to Reconcile Net
Income to Net Cash Provided
by Operating Activities:
Depreciation 154,230 163,041 214,427
Amortization 41,100 41,550 54,442
Decrease, (Increase) In:
Deferred Tax Asset -0- -0- -0-
Patent and Patent
Application Costs ( 7,252) ( 4,729) ( 5,495)
Accounts Receivable -0- -0- -0-
Real Estate Brokers
Commissions -0- -0- ( 33,863)
Increase, (Decrease) In
Accounts Payable and
Accrued Expenses 4,758 ( 30,604)( 104,454)
Other 9,023 ( 76,966)( 216)
------- --------- -------
Total Adjustments 201,859 92,292 124,841
------- -------- -------
Net Cash Provided (Used) by
Operating Activities 357,581 179,212 291,732
------- -------- -------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Capital Expenditures -0- ( 5,893)( 7,976)
Proceeds from Sale of Assets -0- -0- -0-
Proceeds/Purchase of Short
Term Investments 421,282 -0- ( 21,282)
------- -------- ---------
Net Cash Flows from Investing
Activities 421,282 ( 5,893)( 29,258)
------- -------- ----------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Principal Payments on First
Mortgage ( 216,733) ( 198,632) ( 267,784)
Principal Payments on Loan
Payable - Tandy -0- -0- -0-
Purchase of Treasury Stock ( 73,822) ( 58,375) ( 58,375)
Other -0- -0- -0-
----------- -------- ---------
Net Cash Flows Provided (Used)
by Financing Activities ( 290,555) ( 257,007) ( 326,159)
---------- -------- ---------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 488,308 ( 83,688) ( 63,685)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 301,623 365,308 365,308
---------- -------- ---------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 789,931 $ 281,620 $ 301,623
========= ========= =========
3
<PAGE>
HOLOBEAM, INC.
Notes to Condensed Financial Statements
Form 10Q
June 30, 1999
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, 1999 and 1998 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, 1999 and
1998.
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, 1999 are not necessarily indicative of the results
of operations to be expected for a full year.
4
<PAGE>
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
June 30, 1999
(1) Material Changes in Financial Condition
---------------------------------------
During the quarter ended June 30, 1999, the Registrant
contributed to its defined benefit pension plan in the amount
of $76,943.00. Total contributions for the current fiscal
year commenced on October 1, 1999 has amounted to $230,830.00.
(Reference is made to the Registrant's Annual Report, Form
10K, Item 7(2) for the fiscal year ended September 30, 1998).
The Registrant has continued funding of the surgical
staples project, with costs during the quarter ended June 30,
1999 amounting to $54,522.00. Expenditures for the project
during the nine months ended June 30, 1999 have totaled
$156,332.00.
The Registrant anticipates continuing funding further
research and development efforts associated with the surgical
staples project during the balance of the current fiscal year
and into the next fiscal year provided that Registrant
believes results are sufficiently positive in nature.
The Registrant anticipates significant additional time,
effort and expenditures will be necessary before being in a
position to decide if the technology offers sufficient
advantages such that commercialization by the Registrant is
5
<PAGE>
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
June 30, 1999
feasible in view of the significant competition that can be
anticipated from firms established in the business area that
are substantially larger and have much greater resources than
the Registrant. The Registrant has had discussions of a
preliminary nature with firms presently active in this
business area to determine if a business relationship is
feasible, but no conclusions have been reached as of the
present and it is anticipated that significant testing of
Registrant's technology would be required by such a firm
before entering into a relationship. Further, the medical
device area is one which very active research and development
takes place, and there is no assurance that technology
competing with and possibly superior to the technology of the
Registrant will not be developed by others.
During the three months and the nine months ended June
30, 1999, Registrant's Working Capital increased $23,478.00
and $28,597.00, respectively, and totaled $350,873.00 at June
30, 1999. Changes in Cash and Cash Equivalents occurred as a
result of redemption of the Registrant's short-term
investments and subsequent conversion to Cash Equivalents
(Certificate of Deposit).
The Registrant expects to continue funding of the
6
<PAGE>
HOLOBEAM, INC.
Form 10Q
Management's Discussion and Analysis of Financial Condition
and Results of Operations
June 30, 1999
surgical staples project and of the defined benefits pension
plan, and anticipates no materially adverse effect upon its
financial condition.
(2) Material Changes in the Results of Operations
---------------------------------------------
Results of Operations for the three months and nine
months ended June 30, 1999 indicate after-income-tax earnings
in the amount of $49,087.00 and $155,722.00, respectively, as
compared to a loss of $79,957.00 and after-income-tax earnings
of $86,920.00 for the three months and nine months ended June
30, 1998.
Revenues associated with the Registrant's real estate
rental activities for the nine month period ended June 30,
1999 increased somewhat as a result of an increase in rental
income received as per an escalation clause in one of the
Registrant's leases.
The Registrant anticipates that earnings associated with
the existing leases on its properties will continue during the
next twelve months and during the remaining terms of these
leases.
7
<PAGE>
PART II
HOLOBEAM, INC.
Signatures
Form 10Q
June 30, 1999
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 13, 1999
Holobeam, Inc.
Registrant
William M. Hackett
Treasurer and Director
8
<PAGE>
Exhibit A
HOLOBEAM, INC.
Computation of Earnings Per Common Share
Form 10Q
June 30, 1999
Nine Months Ended
June 30
----------------------
1999 1998
----- -------
PRIMARY
- -------
Net Income (Loss) $155,722 $ 86,920
SHARES
- ------
Weighted Average Number of Common
Shares of Outstanding 298332 304930
Primary Earnings Per Share $0.52 $0.29
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-END> JUN-30-1999
<CASH> 789,931
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 794,823
<PP&E> 7,501,587
<DEPRECIATION> 1,723,636
<TOTAL-ASSETS> 7,125,007
<CURRENT-LIABILITIES> 439,058
<BONDS> 0
0
0
<COMMON> 30,559
<OTHER-SE> 907,877
<TOTAL-LIABILITY-AND-EQUITY> 7,125,007
<SALES> 0
<TOTAL-REVENUES> 1,456,954
<CGS> 0
<TOTAL-COSTS> 322,041
<OTHER-EXPENSES> 468,153
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 407,438
<INCOME-PRETAX> 259,322
<INCOME-TAX> 103,600
<INCOME-CONTINUING> 155,722
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 155,722
<EPS-BASIC> .52
<EPS-DILUTED> .52
</TABLE>
