SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A NO. 1
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For Quarterly Period Ended March 31, 1995
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the Transition Period From to
Commission File Number 1-11046
TOP SOURCE TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 84-1027821
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification Number)
2000 PGA BLVD., SUITE 3200, PALM BEACH GARDENS, FLORIDA
33408
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (407) 775-5756
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
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class
Outstanding at April 30, 1995 Common stock, $.001 par value
27,327,080 shares
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
INDEX
Page
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
Consolidated Balance Sheets as of March 31, 1995
(Unaudited) and September 30, 1994 . . . . . . . . . . . . . . . . 1
Consolidated Statements of Operations for the
Three and Six Months Ended March 31, 1995 and 1994
(Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-3
Consolidated Statements of Cash Flows for the
Six Months Ended March 31, 1995 and 1994
(Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Notes to Unaudited Interim Consolidated
Financial Statements . . . . . . . . . . . . . . . . . . . . . . 5-6
ITEM 2. Management's Discussion and Analysis of Interim
Financial Condition and Results of Operations . . . . . . 6-8
PART II - OTHER INFORMATION
ITEM 4. Submission of Matters to a Vote of Security Holders . . . . . . . . 9
ITEM 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . 9
i
TOP SOURCE TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 1995 AND SEPTEMBER 30, 1994
(UNAUDITED)
March 31, September
ASSETS 1995 1994
Current Assets: (restated)
Cash and cash equivalents 1,328,127 1,429,362
Accounts receivable (net of allowance of $221,126
and $150,000 at March 31,1995 and September 30,
1994, respectively) 2,464,352 3,363,560
Advances to officers 45,765 40,000
Inventories 676,881 356,498
Prepaid expenses 419,555 307,605
Other 160,348 262,875
------------ ------------
Total current assets 5,095,028 5,759,900
Property and equipment, net 2,957,900 2,204,858
Manufacturing and distribution rights and patents, net 376,834 376,799
Capitalized database, net 2,811,110 2,916,527
Intangible assets relating to businesses acquired, net 4,832,490 4,869,746
Deferred income tax assets, net 2,270,000 2,270,000
Other assets, net 733,769 82,125
------------ ------------
TOTAL ASSETS 19,077,131 18,479,955
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable 2,341,025 1,605,322
Accrued liabilities 331,369 657,779
Deferred service revenue 460,000 624,642
Bank debt 500,000 ---
Note payable-affiliate --- 88,042
------------ ------------
Total current liabilities 3,632,394 2,975,785
Commitments and contingencies
Stockholders' equity:
Preferred stock-$.10 par value, 5,000,000 shares
authorized; none outstanding --- ---
Common stock-$.001 par value, 50,000,000 shares
authorized; 27,327,080 and 26,716,395 shares issued
March 31 and September 30, respectively 27,327 26,716
Additional paid-in capital 26,012,694 25,214,445
Accumulated deficit (10,463,499) (9,605,206)
Treasury stock-at cost; 87,534 shares (131,785) (131,785)
------------ ------------
Total stockholders' equity 15,444,737 15,504,170
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 19,077,131 18,479,955
============ ============
See accompanying notes to unaudited interim consolidated financial statements.
TOP SOURCE TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31,
1995 AND 1994 (UNAUDITED)
1995 1994
(restated)
------------ ------------
Product sales 3,836,156 2,366,092
Service revenue 1,461,523 1,642,893
Other --- ---
------------ ------------
Net sales 5,297,679 4,008,985
Cost of product sales 2,399,276 1,313,475
Cost of services 1,276,653 1,182,924
Other --- ---
------------ ------------
Cost of sales 3,675,929 2,496,399
------------ ------------
Gross profit 1,621,750 1,512,586
Expenses:
General and administrative 1,343,115 784,252
Selling and marketing 528,281 268,138
Professional fees 72,192 104,251
Depreciation and amortization 202,466 29,650
Research and development 9,130 33,504
------------ ------------
Total expenses 2,155,184 1,219,795
------------ ------------
Income (loss) from operations (533,434) 292,791
Other income (expense):
Interest income 9,535 5,450
Interest expense (2,427) (51,268)
Interest expense-affiliate --- (2,606)
Other income (expense), net (12,416) 268,898
------------ ------------
Net other income (expense) (5,308) 220,474
------------ ------------
Net income (loss) before income taxes (538,742) 513,265
Income tax benefit --- 2,220,000
------------ ------------
Net income (loss) (538,742) 2,733,265
Net loss per weighted average common share ============
outstanding (0.02)
============
Weighted average common shares outstanding 27,231,190
============
Net income per common and common
equivalent share:
Primary 0.10
============
Fully diluted 0.09
============
Common and common equivalent shares:
Primary 28,562,434
============
Fully diluted 28,789,471
============
See accompanying notes to unaudited interim consolidated financial statements.
TOP SOURCE TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE SIX MONTHS ENDED MARCH 31,
1995 AND 1994 (UNAUDITED)
1995 1994
(restated)
------------ ------------
Product sales 6,962,295 4,238,245
Service revenue 2,831,216 3,425,626
Other --- 29,643
------------ ------------
Net sales 9,793,511 7,693,514
------------ ------------
Cost of product sales 4,309,734 2,462,602
Cost of services 2,410,712 2,383,006
Other --- 9,770
------------ ------------
Cost of sales 6,720,446 4,855,378
------------ ------------
Gross profit 3,073,065 2,838,136
Expenses:
General and administrative 2,664,027 1,399,036
Selling and marketing 801,029 536,593
Professional fees 170,769 217,020
Depreciation and amortization 284,738 57,831
Research and development 19,978 59,154
------------ ------------
Total expenses 3,940,541 2,269,634
------------ ------------
Income (loss) from operations (867,476) 568,502
Other income (expense):
Interest income 27,657 8,320
Interest expense (2,427) (72,309)
Interest expense-affiliate --- (8,004)
Other income (loss), net (16,047) 267,921
------------ ------------
Net other income (expense) 9,183 195,928
------------ ------------
Net income (loss) before income taxes (858,293) 764,430
Income tax benefit --- 2,220,000
------------ ------------
Net income (loss) (858,293) 2,984,430
Net loss per weighted average common share ============ ============
outstanding (0.03)
============
Weighted average common shares outstanding 27,163,209
============
Net income per common and common
equivalent share:
Primary 0.11
============
Fully diluted 0.10
Common and common equivalent shares: ============
Primary 27,894,892
============
Fully diluted 28,516,361
============
See accompanying notes to unaudited interim consolidated financial statements.
TOP SOURCE TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED MARCH 31,
1995 AND 1994 (UNAUDITED)
1995 1994
(restated)
OPERATING ACTIVITIES: ------------ ------------
Net income (loss) (858,293) 2,984,430
Adjustments to reconcile net income (loss) to
net cash used in operating activities:
Depreciation and amortization 588,009 377,084
Discount amortization --- 52,052
Amortization of deferred officers' compensation --- 13,950
Disposal of equipment 29,233 33,446
Deferred income taxes --- (2,220,000)
Advances to officers (45,765) (50,300)
Repayments from officer 40,000 ---
Decrease (increase) in accounts receivable, net 899,208 (1,182,283)
Increase in inventories (320,383) (189,768)
Increase in prepaid expenses (145,845) (85,062)
Decrease (increase) in other assets 132,966 (175,607)
Increase (decrease) in accounts payable and 0
accrued liabilities 244,651 (274,791)
------------ ------------
Net cash provided by (used in) operating activities 563,781 (716,849)
INVESTING ACTIVITIES:
Purchases of property and equipment, net (1,196,864) (786,651)
Additions to patent costs (28,970) (57,100)
Increase in other assets (650,000) ---
Purchase of businesses, net --- (131,889)
------------ ------------
Net cash used in investing activities (1,875,834) (975,640)
FINANCING ACTIVITIES:
Proceeds from sale of common stock, net 798,860 3,862,246
Proceeds from borrowings 1,300,000 600,000
Repayments of borrowings (888,042) (1,622,751)
------------ ------------
Net cash provided by financing activities 1,210,818 2,839,495
------------ ------------
Net increase (decrease) in cash and cash equivalents (101,235) 1,147,006
Cash and cash equivalents at beginning of period 1,429,362 362,351
------------ ------------
Cash and cash equivalents at end of period 1,328,127 1,509,357
============ ============
See accompanying notes to unaudited interim consolidated financial statements.
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying financial statements of Top Source Technologies, Inc. (the
Company) have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to Form
10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all 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 in the accompanying financial statements.
The results of operations of any interim period are not necessarily indicative
of the results of operations for the fiscal year. For further information,
refer to the financial statements and footnotes thereto included in the
Company's annual report on Form 10-K/A No. 1 Amendment for the year ended
September 30, 1994. Certain fiscal year 1994 amounts have been reclassified to
conform to current year presentation.
2. INVENTORIES
Inventories consisted of the following:
March 31 September 30
1995 1994
Raw materials $ 421,909 $ 292,211
Finished goods 254,972 64,287
$ 676,881 $ 356,498
3. BANK DEBT
In November 1994, the Company entered into a $5,000,000 Loan Agreement with
the First Union National Bank of Florida (the "Bank"). The agreement stipulates
that $4,500,000 (OSA Line) of the proceeds are to be used for the purchase of
certain OSAs. The agreement also indicates that $500,000 will be available for
short-term working capital through January 31, 1996. Amounts outstanding under
the Loan Agreement will bear interest at the prime-rate plus .85% and interest
will be payable monthly commencing on December 10, 1994. At March 31, 1995,
$500,000 was outstanding on the short-term working capital portion of the loan.
4. CORRECTION OF REVENUE RECOGNITION PROCEDURES FOR THE COMPANY'S OIL ANALYSIS
SEGMENT
Effective April 1, 1995, the Company changed its method of revenue
recognition for its oil analysis test kits (oil analysis service segment).
Previously, the Company recorded revenue from the advance billing of unprocessed
test kits mailed to customers to collect oil samples. After April 1, 1995, the
Company began correctly recognizing revenue at the time the oil analysis is
rendered.
Through the use of computer modeling techniques, creation of a new software
program to track test kits by identification numbers, and based on an analytic
review of the activity of major customers, the Company has determined that
retroactive application of this revised method to correct the accounting error
from using
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
4. CORRECTION OF REVENUE RECOGNITION PROCEDURES FOR THE COMPANY'S OIL ANALYSIS
SEGMENT, CONT'D
the previous method from the period October 1, 1993 through September 30, 1994
would have resulted in a cumulative zero net change in net income for the
period. Due to the large number of samples processed, the capabilities of the
computer system during this period and the cost prohibitive nature of manually
reconstructing records, the effect on quarterly financial reporting for this
period ended September 30, 1994 is indeterminable. Consequently, the Company
has not restated quarterly financial results for the period ended September 30,
1994. In order to reflect the change in revenue recognition method, the caption
in the liability section of the Company's balance sheet at September 30, 1994
was changed from "Accrued Testing Costs" to "Deferred Service Revenue". Advance
billings for oil analysis services will now be considered deferred revenue until
such time as the oil analysis is rendered.
Application of the correct method of recording oil service revenue for the
period October 1, 1994 through March 31, 1995 results in an increase of
approximately $163,631 in revenue and net income of .01 per share over the
previous method. This increase is included in the year to date revenue and
income for the six month period in the accompanying financial statements for the
period ended March 31, 1995. Approximately $85,088 and .00 per share of the
total increase in revenue occurred in the Company's current reporting period
from January 1, 1995 to March 31, 1995, and is reflected in the accompanying
financial statements for the quarter ended March 31, 1995.
After April 1, 1995, the Company implemented a new computer order entry
system to track samples from the time of mailing unprocessed kits until the
delivery sample results, and has instituted new internal control and accounting
procedures to ensure proper prospective accounting treatment.
5. INCOME TAXES
In February 1992, the Financial Accounting Standards Board adopted
Statement of Financial Accounting Standards ("SFAS") No. 109 "Accounting for
Income Taxes". The Company implemented SFAS No. 109 in
fiscal 1994 by accounting for the cumulative effect of the change in the period
of adoption. The cumulative effect upon adoption was not material. SFAS No.
109 changed the method of computing deferred income taxes from a deferred method
to a liability method. Under the liability method, deferred income taxes are
determined based on temporary differences between the financial statement and
tax bases of assets and liabilities, using enacted tax rates in effect during
the years in which the differences are expected to reverse, and on available tax
carryforwards.
The Company has recorded a deferred income tax benefit and related deferred
income tax asset based on the pre-tax loss in the first six months of fiscal
1995. A valuation allowance in the same amount has been established since the
Company's assessment of future taxable income is unchanged from September 30,
1994. The income tax benefit in the consolidated statement of operations for the
six months ended March 31, 1995 consists primarily of a reduction in the
valuation allowance established upon adoption of SFAS No. 109 of $2,209,874 and
was based on expectations of future taxable income. The Company estimates
future taxable income by projecting the results of its business activities based
on known factors existing at the current date.
The Company's estimate of future taxable income changed from the beginning
of fiscal 1994 due to:
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
5. INCOME TAXES, CONT'D
ogreater certainty regarding the Company's OHSS units for Jeep Cherokee
production installation (this application began in September 1993).
ogreater penetration in the Grand Cherokee OHSS application being attained.
othe decision by Chrysler to convert its Toledo facility to full
utilization for Jeep Cherokee production, thereby increasing the number of
units the Company would be supplying (previously the Toledo facility
produced not only Jeep Cherokees but also other Chrysler models).
oprogress, during mid-fiscal year 1994, in gaining new vehicle applications
for the OHSS.
6. SUBSEQUENT EVENTS
In April 1995, the Company entered into a Loan Agreement (the "Loan") with
First Union National Bank of Florida. The Loan provides for a short-term
working capital line of credit not to exceed $250,000. Amounts outstanding
under the Loan bear interest at the prime-rate plus .85%, with interest payable
monthly. The Loan is secured by the accounts receivable and other assets as
defined in the Loan Agreement. The Company will regularly use this line of
credit and repay it on a regular basis.
On May 10, 1995, the Company entered into an agreement with Adrenaline,
Inc. ("Adrenaline"), the original inventor of the Engine Fuel Economy Emission
Control Reduction System ("EFECS") technology, to sell the proprietary
technology back to Adrenaline. Under the terms of the agreement, the Company
assigned its interest in this technology in return for future royalties.
Beginning in December 31, 1996, the Company will receive an annual royalty equal
to the greater of (i) $50,000, or (ii) an amount based upon royalties received
from sublicensing and a percentage of Adrenaline's net sales derived from the
technology. After the Company receives $400,000 in cumulative royalty payments,
the Company will receive (i) 25% of any royalty income received by Adrenaline
from sublicensing and (ii) 2% of Adrenaline's net sales of the technology. This
technology is currently being tested by a major automotive company, and the
Company believes that this technology is viable.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF INTERIM FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
FINANCIAL CONDITION
Accounts receivable-net, decreased $899,208 which is primarily due to the
receipt in late March of approximately $1,180,000 which normally would have been
received in early April.
Inventories increased $320,383 since September 30, 1994 primarily due to
the increase in finished goods in order to build up inventory levels to meet
anticipated OHSS delivery schedules and to allow for a smooth transition with
continuation of shipments during an anticipated move to a new facility.
Inventory levels at September 30, 1994 were lower than usual.
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF INTERIM FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONT'D
Prepaid expenses increased $111,950 primarily due to the First Union Bank
loan commitment fees of $104,565 which were capitalized and are being amortized
over the term of the loan.
Other assets increased $651,644 which is due to a deposit of $650,000 which
is being held by TJA for security under the agreement between the Company and
TJA.
RESULTS OF OPERATIONS
Net sales increased 32.1% and 27.3% for the three and six months ended
March 31, 1995 compared to the same periods ended March 31, 1994, respectively.
This increase represents record sales for the Company, which is primarily due to
the strong growth in revenue from OHSS whose sales have increased over 60% for
the six months ended March 31, 1995 compared to the same period ended March 31,
1994. UTG's sales volume reflected a continuing decline due to the loss of
accounts caused by competitive pricing and the Company's withdrawal from the
aircraft oil analysis business. A decision was made to withdraw from the
aviation oil analysis business in January 1994 in order to reduce potential
liability. As new business comes
on line, UTG's sales volumes are expected to stabilize at a level comparable to
the quarter ended March 31, 1995.
The overall gross profit margin decreased to 31.4% for the six months ended
March 31, 1995 from 36.9% for the same period ended March 31, 1994. The
decrease was due to a significant decrease in revenue in UTG which was not
offset by a decrease in cost of services as the majority of costs of services
are fixed. Also, the gross profit on product sales declined slightly from 41.9%
to 38.1% in the six months ended March 31, 1995 compared to the same period
ended March 31, 1994 due to the various selling prices and costs of the
component parts of new products introduced for the new model year for the OHSS
speakers.
General and administrative expense increased 71.3% and 90.4% for the three
and six months ended March 31, 1995 compared to the same periods ended March 31,
1994, respectively. This increase is primarily due to the continued expansion
of OSA whose expenses are in excess of $670,000 for the year-to-date period, the
expansion of the Company's business and increases in salary arising from
additional personnel, merit increases and incentive payments.
Selling and marketing expense increased 97.0% and 49.3% for the three and
six months ended March 31, 1995 compared to the same periods ended March 31,
1994, respectively, due to the increased selling and marketing efforts in the
service segments (UTG and OSA) of the Company. UTG has increased their
marketing efforts to generate new customers. OSA's selling expenses have
increased rapidly reflecting the continuing expansion of this segment. OSA has
hired new personnel for the deployment of the OSAs.
Professional fees decreased 30.8% and 21.3% for the three and six months
ended March 31, 1995 compared to the same periods ended March 31, 1994,
respectively, due to the decreased legal fees at UTG. This decrease is
primarily related to the fiscal 1994 legal suit regarding the defense of the UTG
operation against an aviation claim which was settled in September 1994.
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF INTERIM FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONT'D
Depreciation and amortization increased $226,907 for the six months ended
March 31, 1995, compared to the same period ended March 31, 1994. This increase
is due to the additional capital assets acquired of $1,196,864 during the six
months ended March 31, 1995 which includes $173,142 of depreciation expense on
the OSAs. Depreciation and amortization of $303,271 was allocated to cost of
sales as it directly relates to the products and services sold during the six
months ended March 31, 1995.
Research and development decreased 72.7% and 66.2% for the three and six
months ended March 31, 1995 compared to the same periods ended March 31, 1994,
respectively, due to the research and development expenses incurred in fiscal
1994 relating to the ARCS technology which were not incurred in the current
fiscal year.
Interest income increased $19,337 for the six months ended March 31, 1995
compared to the same period ended March 31, 1994. This increase is due to the
interest earned on the increased funds invested in the current fiscal period.
Interest expense decreased $69,882 for the six months ended March 31, 1994
compared to the same period ended March 31, 1995. This is due to the decreased
debt balances compared to the prior year.
Income tax, see Note 5. Income Taxes of Notes to Unaudited Interim
Consolidated Financial Statements for a discussion of income taxes.
Net Income (loss) before income taxes. The reasons for the $858,293 pretax
loss for the six months ended March 31, 1995 versus a $764,430 pretax income for
the same period in the preceding year are mainly due to the continued expansion
of OSA and the decreased profitability at UTG as discussed above.
LIQUIDITY AND CAPITAL RESOURCES
Net cash flows provided by operating activities during the first six months
of the current fiscal year totalled $563,781. This is due to the early
collection of accounts receivable as discussed above. Net cash used in
investing activities was ($1,875,834). The Companyinvested $1,196,864 for
capital assets of which approximately $607,000 were capital assets used in
the OSA operation which is in line with prior investment planning for OSA
needs. Also, a deposit of $650,000 was made to TJA and is being held for
security under the agreement between the Company and TJA. At this time,
the Company cannot determine the number of OSA units which will be deployed
in fiscal 1995. At March 31, 1995, the Company has no material
commitments to purchase capital assets except the OSA requirements which cannot
be determined at this time.
Net cash provided by financing activities was $1,210,818 which primarily
consisted of the exercise of stock options (exercise prices ranged from $.53 to
$5.875) and in total generated $798,860 in net proceeds. During the six months
ended March 31, 1995, the Company borrowed a total of $1,300,000 from its short-
term working capital bank line and repaid $800,000. Also, the Company paid-in-
full the note payable to an affiliate of $88,042.
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF INTERIM FINANCIAL CONDITION
AND RESULTS OF OPERATIONS, CONT'D
LIQUIDITY AND CAPITAL RESOURCES, CONT'D
The Company continues to rely on revenue from its product sales (OHSS) and
service revenue from the Oil Analysis Laboratory (UTG) to provide for its
liquidity needs. In order to meet its short-term liquidity needs and to fund
OSA operating costs, the Company has reached an agreement with Ganz Capital
Management, Inc. for $3,000,000 in Convertible Notes (the "Notes") maturing five
years from date of issue. The Notes bear interest at 9% with interest payable
semi-annually and are convertible into fully registered shares of the Company's
common stock beginning one year after the date of the agreement. The agreement
is expected to be finalized in May 1995. Also, the Company has an additional
$250,000 of available credit from a short-term working capital line (See Note 6.
Subsequent Events of Notes to Unaudited Interim Consolidated Financial
Statements.)
Cash requirements to support currently planned OSA deployment will be
provided by existing bank lines. Depending upon when the Company generates
material revenue from its OSAs and how quickly it ships a substantial number of
OSAs, it may require additional financing to support their rollout. The
Company is in preliminary discussions with prospective investors and strategic
partners should the OSA deployment program be accelerated.
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On March 15th, the shareholder's approved the following at the Annual
Shareholder's Meeting:
Broker
For Against Abstentions Non-Votes
oElected the members to
the board of directors of
the Company to serve until
the Company's next annual 21,383,299 131,651 73,265 0
meeting % 78.54 .48 .27
oRatified the appointment
of Arthur Andersen LLP as
independent auditors for
the fiscal year ended 21,376,930 105,437 105,848 0
September 30, 1995 % 78.52 .38 .39
oApproved the transaction
of other lawful business
that may properly come 20,726,391 436,871 424,953 0
before the meeting. % 76.12 1.61 1.56
Total shares voted: 21,588,215 79.29%
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. EXHIBITS
None
B. REPORTS ON FORM 8-K
A Form 8-K was filed on January 5, 1995 in connection with the
Adoption of the Stockholder Rights Plan.
No other reports on Form 8-K were filed during the quarter ended
March 31, 1995.
TOP SOURCE TECHNOLOGIES, INC.
FORM 10-Q
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.
TOP SOURCE TECHNOLOGIES, INC.
By: /s/ David Natan September 22, 1995
David Natan Date
Vice President & Chief Financial
Officer
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<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1994
<PERIOD-END> MAR-31-1995
<CASH> 1,328,127
<SECURITIES> 0
<RECEIVABLES> 2,510,117
<ALLOWANCES> 221,166
<INVENTORY> 676,881
<CURRENT-ASSETS> 5,095,028
<PP&E> 2,957,900
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0
0
<OTHER-SE> 15,417,410
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<SALES> 9,793,511
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