ITEM 1. BUSINESS
(a) General Development of Business.
During fiscal 1994 Applied Spectrum Technologies, Inc. began implementing a plan of voluntary dissolution pursuant to Minn. Statute #302A.721 that was approved by its shareholders at a Special Shareholders' Meeting held on November 30, 1993. Under the Company's Plan of Dissolution most of its assets were sold during 1994 with some payments deferred into 1995 and beyond. The recovery period ran through 1997. During fiscal 1995 most of the tangible asset sales were collected and only technology licenses remained to be collected. During fiscal 1996 the Company continued to collect license fees and payments on one equipment lease. The results of the plan of dissolution were successful and all liabilities and expenses were either paid or are covered in reserves. On November 17, 2000 a Special Meeting of the shareholders of AST was held at which time the Plan of Dissolution was revoked. Pursuant to the proposal for revocation, a liquidating dividend of approximately $204,000 was paid pro-rata to shareholders in August, 2001.
Prior to implementation of the Dissolution Plan, AST was engaged in the development, manufacture, marketing and sale of digital business communication systems. In its final years of operation, the Company allocated most of its available resources to the marketing and sale of its T-l Multiplexer product which was a communication system that allowed many individual telephone and data services to be transmitted and received over one high speed digital transmission line. The CENTRA Series of T-1 systems included channel banks and T-1 Multiplexers which supported voice, data and video communications for point to point interoffice requirements, as well as digital access to long distance carrier networks.
The Company was organized as a Minnesota corporation on February 17, 1982. The Company's principal executive office located at 65 Norwood Avenue, Upper Montclair, NJ 07034, and its telephone number is (973) 783-1117.
(b) Financial Information About Industry Segments.
Since its inception, the Company has operated in one industry segment - the development, manufacture, marketing and sales of communications products and networks some of which transmit digital data over existing local telephone wires simultaneously with normal voice communications.
(c) Narrative Description of Business.
BACKGROUND
The technology on which the Company's original products were based, including Spread Spectrum Technology, permit data and telemetry to be transmitted simultaneously over telephone wire without interfering with normal voice service. The Company's products were known as data/voice multiplexing ("DVM") equipment and were aimed at operating telephone companies (Telco market).
The Company's Alarm and DVM-400 products were introduced to a Telco marketplace which was slow to develop. Consistent with a strategy begun in 1988, the Company redirected its efforts towards the commercial marketplace, with emphasis on the T-1 Multiplexer market.
During 1989 and early 1990 the Company worked on the development of the T-1 product which was introduced to the market in 1990 and became the Company's primary product.
The Company's lack of financial resources caused the Company to pursue a plan of dissolution as approved by the Board of Directors and approved by the shareholders on November 30, 1993. For more information see Item 7 - Management Discussion and Analysis of Financial Condition.
PRODUCTS
After AST ceased operations in 1993, as part of the implementation of the Dissolution Plan, the Company's products were eliminated through the dissolution process.
MARKETS
During the Dissolution Plan, the Company ceased to pursue any of its former markets.
SALES AND DISTRIBUTION
After ceasing operations and implementing the Dissolution Plan in 1993, the Company did not pursue Sales and Distribution efforts.
Between 1991 and 1993, the Company entered into four agreements with OEM customers which provide for non-exclusive rights to sales, manufacturing and technology of the T-1 Multiplexer product.
During fiscal 1994, two of these OEM agreements were terminated by the customer. The other two OEM agreements expired in fiscal 1997.
PRODUCT DEVELOPMENT
During fiscal 1995 and 1996, there were no product development activities because of the implementation of the Plan of Dissolution.
During fiscal 1996, the Company continued to support its OEM Licenses by use of former employees as consultants.
MANUFACTURING, SERVICE AND SUPPORT
Prior to ceasing operations and implementing the Dissolution Plan, the Company's manufacturing operations consisted primarily of assembly, test and quality control of components and subassemblies and final testing of completed products. Subcontractors assembled printed circuit boards for he Company's products.
Due to a lack of resources, the Company ceased manufacturing and service operations at the end of fiscal 1993. The Company entered into agreements with third parties which protected its customer base from a manufacturing and service standpoint.
A one-year warranty was given on all historic products, and longer warranties were sometimes granted on products sold to distributors and OEMs. During 1992 the Company extended the warranty on its CENTRA T-1 Multiplexer products from one year to five years. Warranty coverage on the CENTRA T-1 Product has been assigned to a third party. Under the terms of the sale of its T-1 inventory as part of the Dissolution Plan, the Company granted extended warranty coverage to the buyer, which expired in 1997.
The Company had a customer service department which provided training, installation and product support. The customer service department administered customer warranties and repairs and provided telephone and on-site assistance. The Company sold its customer service department to a third party in September, 1993.
COMPETITION
The Company implemented its Plan of Dissolution in 1993 and therefore has not been tracking any competitors the past eight years.
BACKLOG
At September 30, 2001 and 2000, the Company's backlog of orders was zero.
GOVERNMENT REGULATION
Communications equipment is subject to federal regulations which require that they be tested and then approved or certified by the Federal Communications Commission (the "FCC") prior to their use, sale, lease or distribution. When required or appropriate, the Company's products were tested and approved by the FCC and were authorized for distribution.
EMPLOYEES
As September 30, 2001, the Company had no employees.
PATENTS, TRADEMARKS AND LICENSES
Prior to adopting the Dissolution Plan, the Company had obtained a number of United States and foreign parts. The 17-year terms of the Company's United States patents expire from the years 2001 to 2004. The Company believed, however, that its principal technological advantage, if any, over existing and prospective competitors was in the ability of its personnel to apply a broad range of techniques, some of which may have been trade secrets of the Company, to the resolution of the customer needs. The Company attempted to protect its trade secrets by requiring each of its employees to execute a confidentiality agreement and by other measures common to technical industries. There was no assurance that any of the Company's patents or other proprietary rights of the Company would be sufficient to prevent effective competition with its products.
The Company's product names "DWV-200" and "SPECTRA" were registered as trademarks in the United States. The Company also claimed common law trademark rights with respect to the name "DVM-400".
During 1994, the Company stopped paying for any further patent or trademark applications or renewals. The Company believes that it has exhausted all efforts of future value for its technologies.
(d) Financial Information About Foreign and Domestic Operation and Export Sales.
Substantially all of the Company's revenue, operating profit and identifiable assets have been attributable to the United States.
ITEM 2.
ITEM 2. PROPERTY
On September 16, 1993, the company vacated its former headquarters and manufacturing facilities located at 450 Industrial Boulevard, Minneapolis, Minnesota. Since 1993, the Company has conducted business through voice mail, P. O. box and facsimile machines. From 1993 to 1997 the Company obtained approximately 300
square feet space for storage of its assets at reasonable monthly rental amounts. In November 1997, the Company vacated its storage space and transferred all of its important records to a storage site in New York.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Company is a party or to which any of its property is the subject.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On November 17, 2000 a special meeting of the shareholders was held, at which the Plan of Dissolution was revoked.
ITEM 4A. EXECUTIVE OFFICERS OF THE REGISTRANT
Year First Elected or Name Age Appointed Position Currently Held ---- --- --------- ----------------------- Mark R. Littell 50 1998 Chief Executive Officer
Mr. Littell has been Chief Executive Office of the Company since January, 1998. Mr. Littell has been President of Norwood Venture Corp. since May 1, 1988.
PART II
ITEM 5.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATD SHAREHOLDER MATTERS
AST's common stock was traded on the national, over-the-counter market under the symbol ASTI after its initial public offering in January, 1988. However the Company was notified by NASD that, due to low trading volume, it would not report transactions in the Company's stock after October 13, 1989.
As of October 1, 2001, there were approximately 792 holders of record of the Company's common stock.
Other than the liquidating dividend paid in August, 2001, the Company has never declared or paid cash dividends on its common stock.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA
APPLIED SPECTRUM TECHNOLOGIES, INC. SUMMARY FINANCIAL INFORMATION (THOUSANDS)
FOR THE FIVE YEARS ENDED SEPTEMBER 30, ---------------------------------------------- Statements of Operations Data: 2001 2000 1999 1998 1997 - ----------------------------- ------ ------ ------ ------ ------
Net Sales $ -- $ -- $ -- $ -- $ 4 Sublicensing revenues -- -- -- -- 8 ------ ------ ------ ------ ------
Total Revenues $ -- $ -- $ -- $ -- $ 12
Operating profit (loss) $ (16) $ -- $ (4) $ -- $ (22) Other income (expense) 11 14 11 12 75 ------ ------ ------ ------ ------ Net Profit loss (5) 14 7 12 53
Net Profit (loss) per share $ -- $ -- $ -- $ -- $ 0.02
Weighted average number of shares outstanding 2,954 2,954 2,954 2,954 2,954
Balance Sheets Data:
Cash and short-term investments $ 37 $ 262 $ 255 $ 248 $ 324 Working capital $ 10 $ 245 $ 227 $ 220 $ 208 Total Assets $ 37 $ 262 $ 255 $ 248 $ 324 Long-term liabilities -- -- -- -- -- Shareholders' equity $ 10 $ 245 $ 227 $ 220 $ 208
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ALALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
All amounts in the following discussion have been rounded to the nearest $1,000.
GENERAL - -------
In its latest audited financial statement, September 30, 1992, the Company's auditors issued a qualified opinion regarding the Company's ability to continue as a going concern. Revenues had been insufficient to generate cash flows sufficient to support operations and pay liabilities. The Company was declared to be in default on its secured credit line in May 1993. A reduction in staffing and departure of key employees such as the President and CEO, Director of Operations and Service Department Manager also negatively impacted the Company's operations.
The Company disclosed in its 10-K for the year ended September 30, 1992, that its liquidity was dependent on its ability to generate additional revenues and make use of the credit line of Norwood. The Company was unsuccessful in its attempts to raise additional equity financing or find a strategic partner. During the second fiscal quarter of 1993, the Company's secured lender Norwood Venture Corp. acquired all of the Company's stock and became the majority (77.3%) owner of the Company.
During March, 1993 the Company reduced its work force from 20 employees to 13 employees and placed its engineering development plans on hold as a means of matching fixed costs to revenues. The Company's President and CEO, James J. Szeliga, resigned as an officer of the Company on May 7, 1993.
For the first nine months of fiscal year 1993 revenues decreased $276,000. Cash decreased $31,000 to $3,000, net working capital excluding cash and credit line borrowing decreased $48,000 to $99,000 and the Company borrowed an additional $88,000 under its Norwood Credit Line. At June 30, 1993 the balance owing on the Norwood Credit Line was $195,000.
In light of the above, the Company embarked upon an extensive search for additional equity or debt investment and for a strategic partner with which to merge, or a purchaser of the Company as a going concern. When neither additional funding nor a strategic partner were located, liquidation pursuant to Chapter 7 or Reorganization under Chapter 11 of the United States Bankruptcy Code was considered. However, the Company believed a greater monetary return would be realized if the Company conducted a controlled dissolution and the assets were sold pursuant to independently negotiated agreements. The Company also concluded that attempted reorganization under Chapter 11, given the Company's inability to generate sufficient revenue to sustain its operations, would only serve to further erode the value of the Company's existing assets.
As a result, the Board of Directors, as a means of attempting to maximize recovery to its creditors and shareholders, adopted a plan of dissolution such that a payment plan to creditors could be implemented and foreclosure by its secured lender could be avoided. As part of the dissolution plan, the Company attempted to sell its assets contingent on future payments. Results were successful and all liabilities and expenses were satisfied. Therefore, funds were available from which to pay a liquidating dividend to AST's shareholders. The Board of Directors of the Company did not seek or obtain an independent report, appraisal or fairness opinion in connection with the proposed dissolution due to the lack of funds required to obtain such an opinion.
Search for Strategic Partner - ----------------------------
Between late 1992 and mid-1993, the Company contacted approximately 60 entities, including HT Communications, Inc. ("HT" or "HT Communications"), seeking equity or debt investment or a strategic partner with respect to a possible merger. Such searches were unsuccessful. Contacts were made with OEM customers, competitors and numerous other companies in the data communications industry regarding the sale of the
Company as an operating concern. The majority of these contacts expressed no interest and none resulted in a feasible offer that would have paid all of AST's outstanding liabilities, nor did any of these contacts culminate in a letter of intent or a definitive agreement.
Shareholder Approval - --------------------
Shareholder approval of the Dissolution Plan was received at a special shareholders' meeting held on November 30, 1993.
Transaction with HT Communications, Inc. - ----------------------------------------
Having received no positive results from its search for a strategic partner, the Company again contacted a number of these same entities to discuss a possible licensing arrangement and/or asset sale. HT Communications was the only company which expressed an interest in pursing further discussions with AST.
In August, 1993, AST entered into a Licensing Agreement with HT Communications granting HT a non-exclusive, perpetual, world-wide license to manufacture those T-1 digital Multiplexer products marketed under the name CENTRA Series 4000 and CENTRA Series 3000. In consideration, HT paid to AST royalties on its sale of certain AST products for a period of three (3) years. With respect to its general terms, the License Agreement with HT was negotiated along the lines of AST's previously existing License Agreements.
In addition to the License Agreement already in place with HT, AST entered into an agreement in December of 1993 with HT Communications for the acquisition of the majority of the T-1 assets of AST. The Agreement called for HT to purchase the fixed assets and inventory at the fair market value and standard cost respectively in installments over approximately nine (9) months commencing in December, 1993. In addition, HT agreed to assume obligations associated with certain AST contracts and to offer some AST employees jobs. Due to HT's cash flow problems, the payment terms of the Agreement were amended such that AST was given a secured interest in HT's assets and the payments were extended to December, 1995 including interest on the unpaid balance at the rate of 12% per annum, with HT having the right to prepay any balance owing.
FINANCIAL INFORMATION FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 1999, - -------------------------------------------------------------------- 2000 AND 2001 - -------------
Revenues - --------
Revenues in 2001, 2000 and 1999 were $0, as a result of the Dissolution Plan.
Cost of Product Sold - --------------------
There were no cost of products sold in 2001, 2000 and 1999 because of the Dissolution Plan.
Expenses - --------
General and administrative expenses in 2001, 2000 and 1999 related to the implementation of the Dissolution Plan and preserving the corporate shell.
Other Income/Expenses - ---------------------
Other income in 2001, 2000 and 1999 consisted of interest income.
Federal Income Tax Consequences of the Transaction - --------------------------------------------------
In 1993, the Company was unable to determine with specificity what the income tax consequences of the proposed dissolution of the Company would be given the uncertainty as to the actual dollars which would be realized upon liquidation of the Company's assets as well as questions regarding how the net operating loss carried forward would be dealt with in light of the changes in control of the Company. However, the company did make the following estimate in this regard:
(i) The extent of net operating loss available to offset income is unknown due to changes in ownership and the difficulty in determining fair market value of the Company;
(ii) The 1993 fiscal year's operating loss will probably offset any gain on the recapture of depreciation or value from the sale of fixed assets;
(iii) Inventory will be sold at approximately the same value as cost, so there will be no income tax consequences; and
(iv) Future royalties will be taxable at normal tax rates unless they can be offset by net operating loss.
The Company has now filed all of its Income Tax Returns and has been able to offset all income from the dissolution recovery process with net operating loss carry forwards. The Company's income tax returns have not been audited by the Internal Revenue Services. The Company believes that the net liquidating dividend to be paid to shareholders in August, 2001 will be treated as a return of capital.
Capital Resources and Liquidity - -------------------------------
Substantially all of the Company's working capital needs have been funded through proceeds from the sales of common stock and preferred stock, or from loans from or guaranteed by certain shareholders. During 1987, all three series of preferred stocks were converted to common stock. In January 1988, the Company's initial public offering
(IPO) was completed. Net proceeds from the IPO were $3,841,000. The funds from the IPO were used to repay $691,000 of convertible debentures and to fund activities in product development and sales and market development during 1988, 1989 and the first half of 1990. The Company also pursued some unsuccessful acquisition strategies during 1989 and 1990.
In the second quarter of fiscal 1990 the Company underwent a restructuring and recapitalization to concentrate primarily on its new CENTRA T-1 Multiplexer product line. The restructuring resulted in substantially all resources being directed towards penetration of the commercial T-1 marketplace. The recapitalization resulted in a 1 for 100 reverse split of the Company's voting common stock. Following the reverse split the Company issued 1,268,000 new shares of voting Common Stock on March 26, 1990 to private investors at $0.50 per share which resulted in $643,000 of equity funding.
In addition to the sale of stock in March 1990, the Company obtained a revolving credit line of up to $500,000 from Norwood Venture Corp. The credit line which was secured by all assets was available based on a borrowing formula equal to 90% of eligible receivables. The agreement with Norwood was modified three times. The most recent modification in March 1992 increased the total line from $500,000 to $600,000 and increased the borrowing base by including up to $100,000 of T-1 Multiplexer inventory. As part of these modifications, Norwood was granted an increase to 1,000,000 shares in its warrants to purchase the Company's common stock at $0.50 per share. Another condition of the modification was a provision that reduced Norwood's Warrant price from $.50 per share to $0.01 per share upon the notice of default by the Company. The company defaulted on its agreement with Norwood in 1993 and then the warrant price was reduced to $0.01 per share. As of June 30, 1993, the Company had $195,000 outstanding against the credit line. During the fourth quarter of 1993, the Company was able to repay the balance owed to Norwood on its credit line as part of the early stages of the dissolution process.
Through September 30, 2001, the Company had incurred net cumulative losses of $16,064,267.
The implementation of the Dissolution Plan has resulted in a reduction of liabilities of $515,000 between fiscal 1993 and 1999. As of September 30, 2001, the Company had cash of $37,000 and booked liabilities of $27,000. The net book value of the Company at September 30, 2001, was $10,000.
The Company's CFO and major shareholder voted to revoke the dissolution of AST and to retain the corporate shell for an unspecified time in hope that it has some additional future value for AST's shareholders. The Company paid a liquidating dividend to shareholders in August, 2001 of approximately $229,000. The Company estimates that $37,000 of undistributed cash, plus future interest income will be sufficient to cover the future carrying costs of the corporate shell.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO FINANCIAL DATA
FINANCIAL STATEMENTS PAGE - -------------------- ----
Statements of Operations - Years ended 13 September 30, 2001, 2000, 1999
Balance Sheets - September 30, 2001, 2000, 1999 14
Statements of Cash Flows - Years ended 15 September 30, 2001, 2000, 1999
Statements of Shareholders' Equity - Years ended 16 September 30, 2001, 2000, 1999
Notes to Financial Statements 17-19
The following data are included herein and should be read in conjunction with the financial statements referred to above.
FINANCIAL STATEMENTS SCHEDULES: - -------------------------------
VIII - Valuation and Qualifying Accounts 20 X - Supplementary Income Statement Information 21
All other schedules are omitted as the required information in inapplicable or the information is presented in the consolidated financial statements or related notes.
APPLIED SPECTRUM TECHNOLOGIES, INC. STATEMENT OF OPERATIONS (UNAUDITED)
See notes to financial statements
APPLIED SPECTRUM TECHNOLOGIES, INC. BALANCE SHEETS (UNAUDITED)
See notes to financial statements
APPLIED SPECTRUM TECHNOLOGIES, INC. STATEMENT OF CASH FLOWS (UNAUDITED)
See notes to financial statements
APPLIED SPECTRUM TECHNOLOGIES, INC. STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)
See notes to financial statements
APPLIED SPECTRUM TECHNOLOGIES, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE A - BASIS OF FINANCIAL STATEMENT PRESENTATION
The September 30, 2001, 2000 and 1999, financial statements are "unaudited" and include a reserve for administration expenses.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Prior to implementing the Plan of Dissolution, the Company was engaged in the development, manufacture, marketing and sale of products for the digital transmission of data.
Revenue Recognition: Revenues from sales were recognized on shipment of the product. Revenues pertaining to development contracts and sub-license fees were recognized when billed. The billings were done on a progress basis to cover expenses incurred or achievement of certain contract milestones and specifications. Expenses in excess of related development contract revenues were charged to product development costs because the Company believes that such contracts may result in future product sales. The Company entered into development contracts to perform feasibility studies and to develop certain products.
Warranties: The Company's products were generally under warranty against defects in material and workmanship for a period of one year. During 1992, the Company increased the warranty period on its CENTRA T-1 Multiplexer products to five years. Under the terms of the sale of the Company's T-1 inventory in 1994, an extended warranty was granted to the Buyer. The Company maintained an accrual for these anticipated future warranty costs based on management's estimates of such costs. The final liability for warranty costs expired in 1997 when the Company's agreement with the buyer expired.
Property and Equipment: During 1997, the Company disposed of all remaining property and equipment.
Profit (Loss) Per Share: Profit (Loss) per share is computed by dividing the net profit (loss) for the period by the weighted average number of shares of Common Stock. Outstanding stock options and warrants are not included in the loss per share calculations as they are anti-dilutive.
NOTE C - REVOLVING CREDIT LINE
The Company had a revolving credit line with Norwood Venture Corp. The revolving credit line secured by all assets was called by Norwood during the third fiscal quarter of 1993, because the Company was in default on its borrowing conditions. As part of the dissolution process, the Company was able to repay the secured lender, Norwood, as of September 30, 1993.
NOTE D - COMMON STOCK
On January 29, 1988, the Company completed its initial public offering and as a result issued 328,073 shares of Common Stock and 164,036 warrants. The Company received net proceeds of $3,841,222.
On March 23, 1990, the shareholders approved a one-for-one hundred reverse stock split of the Company's Common Stock and an amendment to the Articles of Incorporation reducing the authorized Common Stock available for issuance from 175,000,000 common shares to 10,000,000 common shares.
On March 26, 1990, the Company issued 1,268,000 shares of Common Stock to private investors and received net proceeds of $634,000. The Company also granted warrants to purchase up to 600,000 shares of the Company's Common Stock at $0.50 per share to Norwood as a condition to Norwood's revolving credit line.
As a condition to amendments to Norwood's revolving credit line on March 29, 1991, and March 19, 1992, the Company granted additional warrants to purchase an additional 400,000 shares of the Company's Common Stock at $0.50 per share to Norwood. When the Company defaulted on the Norwood loan on 1993, the Warrant price was automatically reduced to $0.01 per share. Norwood exercised its rights to the warrants in January 1995 and purchased 957,877 shares of common stock.
NOTE E - STOCK OPTIONS AND WARRANTS
Edward F. Mackay has a warrant, expiring 7/26/03 to purchase 200,000 common shares at $0.10 per share.
NOTE F - MAJOR CUSTOMERS
Not applicable.
NOTE G - INCOME TAXES
Due to the change in ownership and plan of dissolution it is estimated that most of the Company's net operating loss carryforwards will not be utilized.
NOTE H - LEASES
The Company's previously leased facility was vacated on September 16, 1993. The facility leases expired on March 31, 1993 and the Company extended the use of the space on a month-to-month basis through August 31, 1993.
During fiscal 2001, 2000 and 1999, the Company obtained practically rent-free space for storage of its assets and operation of its business through voice mail, post office box, and facsimile machines.
NOTE I - CHANGE IN CONTROL OF THE COMPANY
During the second fiscal quarter of 1993, Norwood Venture Corp., acquired all of the Company stock owned by Oxford Venture Fund Limited Partnership and Oxford Venture Fund II Limited Partnership placing Norwood in voting control of the majority of the outstanding common stock of the Company.
NOTE J - SIGNIFICANT EVENTS
During 1991 and 1992 the Company entered into OEM sub-licensing agreements with three T-1 customers and during 1993 the Company entered into an OEM sub-licensing agreement with one T-1 customer. These agreements required the Company to transfer certain non-exclusive manufacturing, sales and technology rights to the OEMs. In exchange for the rights, the Company received sub-licensing fees, future royalties and development contract revenues. During 1997, 1996, and 1995, the Company recognized $8,000, $58,000, and $71,000 respectively in sub-licensing revenues from these agreements.
In December 1993, the Company completed an Agreement to sell the majority of its assets to HT Communications.
Based on the results of the Dissolution Plan the Company paid a partial liquidating dividend to shareholders in August, 2001.
APPLIED SPECTRUM TECHNOLOGIES, INC.
SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS
(Not Applicable)
APPLIED SPECTRUM TECHNOLOGIES, INC.
SCHEDULE X - SUPPLEMENTARY INCOME STATEMENT INFORMATION
(Not Applicable)
ITEM 9.
ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCUSSIONS
Not Applicable.
PART III
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT
(a) Directors of the Company ------------------------
Principal Occupation Name of Director Age and Business Experience - ---------------- --- ---------------------------
Mark R. Littell 50 President, Norwood Venture Corp., 1988 a firm which manages venture capital funds. Mr. Littell is also a Director of Video Services Acquisition Corp.
(b) Executive Officers of the Company ---------------------------------
The information required by this Item 10 regarding executive officers is included in this Report under Item 4A, "Executive Officers of the Registrant."
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ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION
(a) Cash Compensation -----------------
The following table provides information as to the compensation of the executive officers for services rendered in all capacities during the fiscal year ended September 30, 2001 and to all executive officers as a group.
Name of Individual Capacities in Cash or Number in Group Which Served Compensation - ------------------ ------------ ------------
Mark R. Littell Chief Executive Officer $ 0
All Executive Officers as a Group (1 Person) $ 0
(b) Compensation Pursuant to Plans
(None)
(c) Director's Compensation
Mr. Littell has waived his directors fees.
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ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) Security Ownership of Certain Beneficial Owners and Management --------------------------------------------------------------
The following table sets forth information pertaining to directors, executive officers and persons who, to the best of AST's knowledge owned beneficially more than five percent (5%) of the voting common stock of AST as of September 30, 2001.
SHARES OF COMMON NAME OF STOCK BENEFICIALLY BENEFICIAL OWNER AMOUNT PERCENT OF CLASS OWNED(1)(2) - ---------------- ------ ---------------- -----------
Norwood Venture Corp.(6) 2,282,564(3) 77.27
Mark R. Littell(7) 2,282,564(4) 77.27
Edward F. Mackay 216,718(5) 6.87
All Directors and 2,499,282 79.24 Officers as a Group
(1) Shares not outstanding but beneficially owned by virtue of the right of an individual or entity to acquire them within sixty (60) days are treated as outstanding only when determining the amount and percentage owned by such individual or entity. Fractional shares have been rounded to the nearest whole share.
(2) Unless otherwise noted, each person or group identified possesses sole voting and investment power with respect to the shares opposite the name of such person or group.
(3) Consists of 2,282,564 shares owned by Norwood Venture Corp. (Norwood).
(4) Includes 2,282,564 shares owned by Norwood. Mr. Littell may be a beneficial owner of Norwood shares.
(5) Includes 200,000 shares Mr. Mackay has the right to acquire within sixty (60) days upon the exercise of options which expire on 7/26/03.
(6) Norwood Venture Corp. is located at 65 Norwood Avenue, Upper Montclair, N.J. 07043.
(7) Mr. Littell's business address is 65 Norwod Avenue, Upper Montclair, N.J. 07043.
(b) Changes in Control ------------------
None
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None
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PART IV
ITEM 14.
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K
PAGE ---- No. - ---
(a) 1. Financial Statements: Reference is made to the Index to Financial Data contained in this Report 12
2. Financial Statement Schedules: Reference is made to the Index to Financial Data contained in this Report 12
3. Reference is made to the Exhibit Index contained in this Report 27-31
A copy of any of the Exhibits listed or referred to in the Exhibit Index will be furnished at a reasonable cost to any person upon a written request for any such exhibit. Such requests should be sent to Applied Spectrum Technologies, Inc., c/o Norwood Venture Corp., 65 Norwood Avenue, Upper Montclair, N.J. 07043.
(b) Reports on form 8-K: None were filed during the fourth quarter of the fiscal year covered by this Report.
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ITEM 14.(A)3.EXHIBITS
The following is a complete list of Exhibits filed or incorporated by reference as a part of this Report:
APPLIED SPECTRUM TECHNOOGIES, INC.
EXHIBIT INDEX TO ANNUAL REPORT ON FORM 10-K FOR FISCAL YEAR ENDED SEPTEMBER 30, 2001
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
Dated: 2/28/02 APPLIED SPECTRUM TECHNOLOGIES, INC.
By /s/ Mark R. Littell ----------------------------------- Mark R. Littell Chief Executive Officer
Pursuant to the requirements of the Securities and 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:
Dated: 2/28/02 By /s/ Mark R. Littell ----------------------------------- Mark R.Littell Chief Executive Officer
Dated: 2/28/02 By /s/ Mark R. Littell ----------------------------------- Mark R. Littell Director