Attached files
| file | filename |
|---|---|
| EX-31.1 - EXHIBIT 31.1 - Princeton Security Technologies, Inc. | ex31111609.htm |
| EX-32.1 - EXHIBIT 32.1 - Princeton Security Technologies, Inc. | ex321111609.htm |
| EX-31.2 - EXHIBIT 31.2 - Princeton Security Technologies, Inc. | ex312111609.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
[X]
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the
quarterly period ended September 30, 2009
[ ]
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the
transition period from __________ to __________
Commission
File Number 333-141482
Princeton Security
Technologies, Inc.
(Exact
name of registrant as specified in its charter)
Nevada 20-5506885
(State or
other jurisdiction
of (IRS
Employer Identification No.)
incorporation or organization)
303C College Road,
Princeton, New Jersey 08540
(Address
of principal executive offices) (Zip
Code)
609-924-7310
(Registrant’s
telephone number, including area code)
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
past 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
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). The registrant has not been
fazed into the Interactive Data reporting system.
Yes
[ ] No [ ]
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definitions of “large accelerated filer,” “accelerated
filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange
Act.
Large Accelerated filer ¨ Accelerated
filer ¨
Non-accelerated filer ¨ (Do not check if a
smaller reporting
company) Smaller
reporting company x
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).
Yes
[ ] No [X]
Indicate
the number of shares outstanding of each of the issuer’s classes of common
equity, as of the latest practicable date.
12,100,375 shares of $0.001
par value common stock on November 1, 2009
Transitional
Small Business Disclosure Format (Check One): Yes
[ ] No [X]
Part
I - FINANCIAL INFORMATION
Item
1. Financial Statements
Princeton
Security Technologies, Inc.
FINANCIAL
STATEMENTS
(UNAUDITED)
September
30, 2009
The
financial statements included herein have been prepared by the Company, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. However, in the
opinion of management, all adjustments (which include only normal recurring
accruals) necessary to present fairly the financial position and results of
operations for the periods presented have been made. These financial
statements should be read in conjunction with the accompanying notes, and with
the historical financial information of the Company.
|
PRINCETON
SECURITY TECHNOLOGIES, INC.
|
||||||||
|
CONSOLIDATED
BALANCE SHEETS
|
||||||||
|
|
September
30, 2009
|
December
31, 2008
|
||||||
|
ASSETS
|
(Unaudited)
|
|||||||
|
Current
Assets
|
||||||||
|
Cash
|
$ | 116,406 | $ | 40,490 | ||||
|
Accounts
receivable (net of allowance for doubtful accounts of $16,426 for both
periods)
|
173,686 | 119,016 | ||||||
|
Other
receivables
|
18,831 | 77,831 | ||||||
|
Inventory
|
304,638 | 460,741 | ||||||
|
Prepaid
expenses
|
44,951 | 54,059 | ||||||
|
Total
Current Assets
|
658,512 | 752,137 | ||||||
|
Property,
plant & equipment (net of accumulated depreciation of $1,366,534 and
$1,353,231 respectively)
|
37,177 | 50,480 | ||||||
|
Deposits
|
49,282 | 11,450 | ||||||
|
Total
Assets
|
$ | 744,971 | $ | 814,067 | ||||
|
LIABILITIES
|
||||||||
|
Current
Liabilities
|
||||||||
|
Accounts
payable and accrued liabilities
|
$ | 583,053 | $ | 554,972 | ||||
|
Accrued
other liabilities
|
906 | 10,185 | ||||||
|
Accrued
vacation expenses
|
33,988 | 25,443 | ||||||
|
Deferred
sales revenue
|
91,290 | 31,679 | ||||||
|
Total
Current Liabilities
|
709,237 | 622,279 | ||||||
|
Notes
payable
|
235,105 | 212,303 | ||||||
|
Total
Liabilities
|
944,342 | 834,582 | ||||||
|
STOCKHOLDERS’ DEFICIT
|
||||||||
|
Preferred
stock; $.001 par value, 10,000,000 shares authorized; no shares issued and
outstanding
|
- | - | ||||||
|
Common
stock; $.001 par value, 90,000,000 shares authorized; 12,100,375 and
11,781,375 shares issued and outstanding as of June 30, 2009 and December
31, 2008, respectively
|
12,100 | 11,781 | ||||||
|
Additional
paid-in capital
|
1,486,390 | 1,406,959 | ||||||
|
Retained
earnings (deficit)
|
(1,697,861 | ) | (1,439,255 | ) | ||||
|
Total
Stockholders’ Deficit
|
(199,371 | ) | (20,515 | ) | ||||
|
Total
Liabilities and Stockholders’ Deficit
|
$ | 744,971 | $ | 814,067 | ||||
|
The
accompanying notes are an integral part of these unaudited consolidated
Financial Statements.
|
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| PRINCETON SECURITY TECHNOLOGIES, INC. | ||||||||||||||||
| UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
|
|
For
theThree Months Ended September 30,
|
For
the Nine Months ended September 30,
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||||||||||||||
|
2009
|
2008
|
2009
|
2008
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|||||||||||||
|
Revenues
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||||||||||||||||
|
Sales (net of returns)
|
$ | 595,833 | $ | 594,654 | $ | 1,500,714 | $ | 2,007,347 | ||||||||
|
Costs of goods sold
|
372,320 | 441,474 | 906,974 | 1,312,328 | ||||||||||||
|
Gross
Profit
|
223,513 | 153,180 | 593,740 | 695,019 | ||||||||||||
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Expenses
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||||||||||||||||
|
Depreciation and amortization
|
2,233 | 6,195 | 13,303 | 18,153 | ||||||||||||
|
Selling and marketing
|
19,102 | 71,159 | 49,732 | 197,840 | ||||||||||||
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General and administrative
|
88,443 | 130,946 | 455,153 | 443,099 | ||||||||||||
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Research and development
|
96,139 | 97,571 | 284,740 | 318,352 | ||||||||||||
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Total
Expenses
|
205,917 | 305,871 | 802,928 | 977,444 | ||||||||||||
|
Gain
(loss) from operations
|
17,596 | (152,691 | ) | (209,188 | ) | (282,425 | ) | |||||||||
|
Other
income/(expenses)
|
(14,459 | ) | (3,680 | ) | (49,418 | ) | (5,758 | ) | ||||||||
|
Provision
for income taxes
|
0 | 0 | 0 | 0 | ||||||||||||
|
Net
income (loss)
|
$ | 3,137 | $ | (156,371 | ) | $ | (258,606 | ) | $ | (288,183 | ) | |||||
|
Net
income (loss) per share of common stock
|
$ | 0.00 | $ | (0.01 | ) | $ | (0.02 | ) | $ | (0.02 | ) | |||||
|
Weighted
average number of common shares
|
12,100,375 | 11,781,375 | 11,899,060 | 11,781,375 | ||||||||||||
|
The
accompanying notes are an integral part of these unaudited consolidated
Financial Statements.
|
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PRINCETON
SECURITY TECHNOLOGIES, INC.
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UNAUDITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
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||||||||
|
For
the Nine Months ending September 30, 2009 and 2008
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|
||||||||
|
|
2009
|
2008
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||||||
|
Cash
flow from operating activities
|
||||||||
|
Net
loss
|
$ | (258,606 | ) | $ | (288,183 | ) | ||
|
Adjustments
to reconcile net loss to net cash provided by (used in) operating
activities:
|
||||||||
|
Depreciation
and amortization
|
13,303 | 18,157 | ||||||
|
Provision
for allowance on accounts receivable
|
- | (2,232 | ) | |||||
|
Accrued
interest
|
27,630 | - | ||||||
|
Stock
issued for services
|
79,750 | - | ||||||
|
Change
in non-cash working capital items:
|
||||||||
|
Accounts
receivable
|
(54,670 | ) | 44,213 | |||||
|
Other
receivables and deposits
|
21,168 | (87,781 | ) | |||||
|
Inventory
|
156,103 | 109,536 | ||||||
|
Prepaid
expenses
|
9,108 | (35,026 | ) | |||||
|
Accounts
payable
|
28,081 | 20,984 | ||||||
|
Accrued
expenses
|
(734 | ) | (24,708 | ) | ||||
|
Lines
of credit
|
(4,828 | ) | 210,607 | |||||
|
Deferred
services contracts
|
- | (4,708 | ) | |||||
|
Deferred
sales
|
59,611 | (27,131 | ) | |||||
|
Cash
flow used in operating activities
|
75,916 | (66,272 | ) | |||||
|
Cash
flow provided by investing activities
|
- | - | ||||||
|
Cash
flow provided by financing activities
|
- | - | ||||||
|
(Increase)
decrease in cash position
|
75,916 | (66,272 | ) | |||||
|
Cash
position at beginning of period
|
40,490 | 81,179 | ||||||
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Cash
position at end of period
|
$ | 116,406 | $ | 14,907 | ||||
|
Supplemental
disclosure of cash flow information:
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||||||||
|
Cash
paid for:
|
||||||||
|
Interest
|
$ | 21,788 | $ | 5,758 | ||||
|
Income
taxes
|
$ | - | $ | - | ||||
|
The
accompanying notes are an integral part of these unaudited consolidated
Financial Statements.
|
||||||||
Item
2. Management’s Discussion and Analysis of Financial Condition and Results of
Operations
Special
Note Regarding Forward-Looking Statements
This
periodic report contains certain forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995 with respect to the Plan
of Operations provided below, including information regarding the Company’s
financial condition, results of operations, business strategies, operating
efficiencies or synergies, competitive positions, growth opportunities, and the
plans and objectives of management. The statements made as part of the Plan of
Operations that are not historical facts are hereby identified as
"forward-looking statements."
Business of the
Company
Corporate
Information
Princeton
Security Technologies, Inc. (“Princeton” or the “Company”) a Nevada corporation
is the parent company of Princeton Gamma Tech Instruments, Inc. (“PGTI”) which
develops and manufactures detection equipment used in the homeland security and
industrial marketplaces. When used herein Princeton or the Company
includes PGTI. PGTI is a Princeton, New Jersey based
corporation founded in February 2005. PGTI acquired all the business assets for
its Detector and Microanalysis systems from a subsidiary of a global stainless
steel company, Outokumpu Oyj, in February 2005. Since then, PGTI has
restructured its operation, sold its undesired Microanalysis business to a
subsidiary of Bruker Biosciences Corp., and focused its efforts towards the
detector business and its existing homeland security and industrial
marketplaces.
Products
Through
the purchase of the detector business, Princeton acquired X-ray and Gamma-ray
Detectors and Spectroscopy systems, and portable Radioisotope
Identifiers. More importantly, we also acquired the management and
scientific teams responsible for the development of this
technology. Currently we produce both individual detection units as
well as component parts for larger units manufactured and sold by other
companies.
The uses
for our products encompass a variety of industrial, commercial and security
concerns ranging from the homeland security need to detect concealed
radioactive material, to silicon wafer fabrication companies that use our
products and components to analyze silicon wafers for defects.
The
nature of our technology allows our products to encompass a variety of
uses. Our products typically have three basic technologies that
can be combined to create a detection unit or system. Each of
our products contains a sensor, electronic circuitry to process the signal from
the sensor and firmware or software to analyze and interpret the processed
signal. Princeton has design, development and manufacturing
capability in all three technology areas. By focusing on these three
core competencies used in detectors and components, we are able to design
products for multiple industries and users.
As part
of our core technology, we have developed the internal capability to produce a
high purity germanium radiation sensor , Sodium Iodide and Lanthanum Bromide
scintillators, which are the key component
in Gamma-ray detection systems. We do also have an
internal capability to process x-ray detectors, as well. These capabilities
allow us to compete with the limited number of companies who have the
ability to work with these types of sensors. These sensors are
used to detect radioactive isotopes.
Currently,
our product line includes the following component and detectors:
|
-
|
Category 1:
Radioactive Isotope Identifier
Products.
|
The
current product is termed the SAM Defender. This hand-held instrument
is a self-contained radiation detector, low-noise signal processor, and user
interface. Our proprietary analysis software provides an intuitive
color display suitable for both First Responders as well as more technically
trained Health Physicists. This product and product versions are
mainly used for large homeland security market applications, as well as for
environmental, industrial and medical purposes. This product detects
neutron and gamma radiation from over 100 isotopes. The SAM
Defender
was designed to meet the latest American National Standards Institute “ANSI” and
other government standards for portable radiation detection
equipment
We have
added a Fixed Installation unit, called Area Monitor, to our product offering.
It is being offered and used in building security
applications, hospitals, industrial applications and generally in
security applications where an identified area or facility needs to be
secured.
|
-
|
Category 2: Nuclear/
Gamma-ray detectors and
spectrometers:
|
PGTI is
one of the handful of companies worldwide that manufacturers High Purity
Germanium Detectors and associated electronics and software for the most
sensitive and accurate detection and analysis of radioactive samples in a
laboratory environment. A typical application is the measurement of
very low-levels of radioisotopes in soil, water or geological samples to
determine the efficacy of radioactive waste cleanup or to conduct geophysics
research. This type of lab-based instrumentation is also used by the
nuclear power industry for on-line monitoring. Customers include
Federal and State governmental authorities, research laboratories and large
corporations.
|
-
|
Category 3: X-ray
detectors and spectrometers.
|
These
products address the research and industrial analysis need in the Microanalysis
or XRF market. The Microanalysis Market is the branch of industry and scientific
research that requires the non-destructive analysis of materials on a
sub-millimeter dimensional scale.
The
non-destructive testing of materials by X-ray analysis utilizes a range of
detector products from small hand-held units to large systems installed on a
Synchrotron and used for the fundamental research of materials. PGTI
supplies both detector components as an OEM supplier and also complete X-ray
spectrometer systems. Applications include quality control (e.g., for
Silicon wafer fabrication), fundamental material research (e.g., on a
synchrotron), and industrial control and monitoring, (e.g., engine wear
analysis). A typical application is analyzing various metals for quality or
research purposes.
Discussion and Analysis of
Financial Condition and Results of Operations
Critical Accounting Policies
and Estimates
The
preparation of financial statements and related disclosures in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the amounts
reported in the unaudited Condensed Consolidated Financial Statements and
accompanying notes. Management bases its estimates on historical
experience and on various other assumptions that are believed to be reasonable
under the circumstances. Actual results could differ from these estimates
under different assumptions or conditions. The Company believes
there have been no significant changes during the year ended December 31,
2008.
The
Company’s accounting policies are more fully described in Note 1 of the
consolidated financial statements. As discussed in Note 1, the
preparation of financial statements and related disclosures in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions about the future events
that affect the amounts reported in the consolidated financial statements and
the accompanying notes. Management bases its estimates on historical experience
and on various other assumptions that are believed to be reasonable under the
circumstances. Actual differences could differ from these estimates
under different assumptions or conditions. The Company believes that
the following addresses the Company’s most critical accounting
policies.
We
recognize revenue in accordance with FASC 605-10-S25,“Revenue Recognition.
Revenue is recognized at the point of passage to the customer of title and risk
of loss, when there is persuasive evidence of an arrangement, the sales price is
determinable, and collection of the resulting receivable is reasonably
assured. We recognize revenue as services are provided with specific
long lead time orders.
Our
allowance for doubtful accounts is maintained to provide for losses arising from
customers’ inability to make required payments. If there is
deterioration of our customers’ credit worthiness and/or there is an increase in
the length of time that the receivables are past due greater than the historical
assumptions used, additional allowances may be required. For example, at
September 30, 2009, every additional one percent of our accounts receivable that
becomes uncollectible would reduce our operating income by approximately
$1,901.
We
account for income taxes in accordance with FASC 718-740-20, “Accounting for
Income Taxes”. Deferred tax assets and liabilities are measured using
enacted tax rates in effect for the year in which the differences are expected
to reverse. Deferred tax assets will be reflected on the balance
sheet when it is determined that it is more likely than not that the asset will
be realized. A valuation allowance has currently been recorded to
reduce our deferred tax asset to $0.
Our Business
Growth
For the
quarter ended September 30, 2009 our sales increased to $595,833 from $594,654
for the quarter ended September 30, 2008. Our gross profit increased
to $223,513 compared to the same period in 2008 when gross profits were
$153,180. Our Radioactive Isotope Identifier products sales had the
biggest sales volume of all product categories, totaling about 54% of
the total sales; Nuclear Detectors sales was about 34% of the total sales and
X-ray Detector sales was about 12% of the total sales for the quarter ended
September 30, 2009. The largest growth in the nine months ended September 30,
2009, was Radioactive Isotope Identifier Products, due to new product
applications of Area Monitor family products, which mostly addresses Homeland
Security market demand as well as nuclear power plant security
applications. We anticipate growth across our product line in 2009,
however biggest growth continues to be in Radioactive Isotope Identifier Product
line, where we still have a strong order backlog.
Results of
Operations
Total
sales increased for the three month period ending September 30, 2009. Sales
increased from $594,654 to $595,833 compared to the same period
during 2008. Our gross profit margin increased by 45.9% compared to
the same period in 2008. Our expenses decreased by $99,949, or 32.7%,
compared to the quarter ended September 30, 2008, from $305,871to
$205,922 for the quarter ended September 30, 2009. The
reduction in expenses for the quarter was due to overall cost cutting
implemented by the company earlier in 2009. As a result of lower
expenses and an increase in sales, the net profit
was $3,137 for the quarter ended September 30, 2009 from a net loss
of $156,371 for the same period in 2008.
Total
sales decreased $506,633 for the comparable nine months ending September 30,
2009 from 2008. Our gross profit margins increased 5% due to more profitable SAM
Isotope Identifier sales. Our expenses decreased by $174,516 for the
comparable nine months ending September 30, 2009 from 2008 reducing
expenses for the nine months in 2009 to $802,928 from
$977,444 for the nine months ending September 30, 2008 . As a result
of the reduced expenses our net loss narrowed to $258,606 for the nine months
ending September 30, 2009 from $288,183 in 2008. The deceased loss was a
reflection of reduced expenses with higher gross margin but lower sales
volume. We continue to invest in our research and
development activities which partially affects our quarterly profitability but
is an essential part of our long term strategy. We have been able to
reduce our cost of goods sold and will continue to keep working on
that. We are hopeful, as our R&D will generate new products, we
are able to increase sales as well as improve the profitability which can be
reached with moderately higher sales revenue.
We
anticipate general and administrative expenses to remain at present levels or
slightly higher in the future. General and administrative expenses
decreased 53.7% from $130,946for the September 30, 2008 quarter to $85,161 for
the quarter ended September 30, 2009. We expect general and
administrative expenses to remain at present level in future quarters, however
if the sales revenue increases we may have to expand our
operations.
Since we keep investing in
R&D and are in the initial phases of product sales for some new products, we
are hopeful sales will increase and be able to cover operating
cost. We will be dependent on sales to increase before we will
be able to cover ongoing cost. Until we are able to increase sales,
we may have to seek additional financing to fund operations.
Seasonality and
Cyclicality
In our
business, we have experienced lower sales volume during the past years in the
beginning of the first quarter as well as summer months in
general. We believe this trend may continue in the future, as
well.
Liquidity and Capital
Resources
Historically,
we have financed our working capital requirements through internally generated
funds and sales of equity
and debt
securities. Since inception through September 30, 2009, we raised approximately
$1.486 million from the sale of equity securities. As we continue to
expand our operations, we anticipate seeking additional capital through the sale
of equity securities. Our goal is to position Princeton to be able to
raise larger amounts of equity capital through the public markets or through
private investments. At this time we do not know the extent of the
overall financing will need in the future. Financing will depend on
how well our products are received in the marketplace.
At
September 30, 2009, we had negative working capital of $50,725. A big
component of our current liabilities as of September 30, 2009, was our accounts
payable of $583,053. We feel we will be able to service ongoing
payables with current revenue and existing capital. Our current
assets consist of $116,406 in cash, increase of $75,916 from the
previous quarter, $173,686 in accounts receivable and our inventory was
$304,638 so we will be dependent on collecting accounts receivable
and selling our inventory to cover ongoing payables. We
may be forced to seek additional debt or equity capital to cover any liquidity
issues that may arise as we try and increase sales and collect on accounts
receivables.
We
anticipate the same level of profitability to continue for the year but to
increase as our sales begin to expand. However, it is our goal to
increase marketing and sales which will require additional capital beyond any
revenue anticipated. In the future, we may issue additional debt or equity
securities to satisfy our cash needs. Any debt incurred or issued may
be secured or unsecured, at a fixed or variable interest rates and may contain
other terms and conditions that our board of directors deems
prudent. Any sales of equity securities may be at or below existing
market prices. We cannot assure you that we will be successful in
generating sufficient capital to adequately fund our liquidity
needs.
Off-Balance
Sheet Arrangements
We have
no off balance sheet arrangements as of September 30, 2009.
Forward-looking
Statements
The
Private Securities Litigation Reform Act of 1995 (the “Act”) provides a safe
harbor for forward-looking statements made by or on behalf of our Company. Our
Company and our representatives may from time to time make written or oral
statements that are “forward-looking,” including statements contained in this
Annual Report and other filings with the Securities and Exchange Commission and
in reports to our Company’s stockholders. Management believes that all
statements that express expectations and projections with respect to future
matters, as well as from developments beyond our Company’s control including
changes in global economic conditions are forward-looking statements within the
meaning of the Act. These statements are made on the basis of management’s views
and assumptions, as of the time the statements are made, regarding future events
and business performance. There can be no assurance, however, that management’s
expectations will necessarily come to pass. Factors that may affect forward-
looking statements include a wide range of factors that could materially affect
future developments and performance, including the following:
Changes
in Company-wide strategies, which may result in changes in the types or mix of
businesses in which our Company is involved or chooses to invest; changes in
U.S., global or regional economic conditions, changes in U.S. and global
financial and equity markets, including significant interest rate fluctuations,
which may impede our Company’s access to, or increase the cost of, external
financing for our operations and investments; increased competitive pressures,
both domestically and internationally, legal and regulatory developments, such
as regulatory actions affecting environmental activities, the imposition by
foreign countries of trade restrictions and changes in international tax laws or
currency controls; adverse weather conditions or natural disasters, such as
hurricanes and earthquakes, labor disputes, which may lead to increased costs or
disruption of operations.
This list
of factors that may affect future performance and the accuracy of
forward-looking statements is illustrative, but by no means exhaustive.
Accordingly, all forward-looking statements should be evaluated with the
understanding of their inherent uncertainty.
Item
3. Quantitative and Qualitative Disclosures About Market
Risk.
This item
is not required for Small Reporting Companies.
Item
4T. Controls and Procedures.
Evaluation
of Disclosure Controls and Procedures
Our
management, with the participation of our President and CFO, evaluated the
effectiveness of our disclosure controls and procedures as of the end of the
period covered by this report. Based on that evaluation, our President and CFO
concluded that our disclosure controls and procedures as of the end of the
period covered by this report were effective such that the information required
to be disclosed by us in reports filed under the Exchange Act is
(i) recorded, processed, summarized and reported within the time periods
specified in the SEC’s rules and forms and (ii) accumulated and
communicated to our management, including our President and CFO, as appropriate
to allow timely decisions regarding disclosure. A controls system cannot provide
absolute assurance, however, that the objectives of the controls system are met,
and no evaluation of controls can provide absolute assurance that all control
issues and instances of fraud, if any, within a company have been
detected.
Management’s
Report on Internal Control over Financial Reporting
Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting (as defined in Rule 13a-15(f) under the
Exchange Act). Our internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes of
accounting principles generally accepted in the United
States.
Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Therefore, even those systems determined to be
effective can provide only reasonable assurance of achieving their control
objectives.
Our
management, with the participation of the President and CFO, evaluated the
effectiveness of our internal control over financial reporting as of September
30, 2009. Based on this evaluation, our management, with the participation
of the President and CFO, concluded that, as of September 30, 2009, our internal
control over financial reporting was effective.
Changes
in internal control over financial reporting
There
have been no changes in internal control over financial reporting.
PART
II - OTHER INFORMATION
ITEM
1. Legal Proceedings
None
ITEM
2. Unregistered Sales of Equity Securities and Use of
Proceeds
Recent Sales of Unregistered
Securities
We sold
319,000 restricted common shares during the nine months
ended September 30, 2009.
Use
of Proceeds of Registered Securities
None; not
applicable.
The
proceeds from sold shares were being used for sales and promotional purposes of
the company. The shares were issued directly to the vendors of the
company.
Purchases
of Equity Securities by Us and Affiliated Purchasers
During
the three months ended September 30, 2009, we have not purchased any equity
securities nor have any officers or directors of the Company.
ITEM
3. Defaults Upon Senior Securities
We are
not aware of any defaults upon senior securities.
ITEM
4. Submission of Matters to a Vote of Security Holders
No
matters were submitted to a vote of security holders during the quarter ended
September 30, 2009.
ITEM
5. Other Information.
None
ITEM
6. Exhibits
(a)
Exhibits.
Item
4
Exhibit
No.
Instruments
Defining the Rights of Security Holders
Location
4.01
4 Specimen
Stock
Certificate Incorporated
by
reference*
31.01 31
CEO certification Pursuant
to
18 USC Section 1350, as
adopted
pursuant to Section 302
of
Sarbanes-Oxley Act of
2002 This
Filing
31.02 31
CFO certification Pursuant
to 18 USC Section 1350,
as
adopted
pursuant to Section 302
of
Sarbanes-Oxley Act of
2002
This Filing
32.01 32 CEO
Certification pursuant to
section
906 This
Filing
32.02 32 CFO
Certification pursuant to
Section
906 This
Filing
*
Incorporated by reference from the Company's registration statement on Form SB-2
filed with the Commission, SEC file no. 333-141482.
SIGNATURES
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.
Princeton Security
Technologies, Inc.
(Registrant)
Date: November
16,
2009 By: /s/ Juhani
Taskinen
Juhani
Taskinen, CEO and CFO