Attached files
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 2013
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Commission File Number: 000-22855
AMERICAN SOIL TECHNOLOGIES, INC.
(Exact name of small business issuer as specified in its charter)
Nevada 95-4780218
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
7745 Alabama Ave #9 Canoga Park, CA 91304
(Address of principal executive offices)
(818) 899-4686
(Issuer's telephone number)
N/A
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act 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 during the
preceding 12 months (or for such shorter period that the registrant was required
to submit and post such files). Yes [X] 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
the 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 [ ] Smaller reporting company [X]
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell Company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
As of August 12, 2013, the number of shares of common stock issued and
outstanding was 68,090,590.
Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]
INDEX
Page
Number
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PART I - FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements (Unaudited) 3
Consolidated Balance Sheets -
June 30, 2013 and September 30, 2012 3
Consolidated Statements of Operations -
For the three and nine months ended June 30, 2013 and 2012 4
Consolidated Statements of Cash Flows -
For the nine months ended June 30, 2013 and 2012 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 11
Item 3. Qualitative and Quantitative Disclosures About Market Risk 14
Item 4. Controls and Procedures 14
Item 4T. Controls and Procedures 14
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 15
Item 1A. Risk Factors 15
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 15
Item 3. Defaults Upon Senior Securities 15
Item 4. Mine Safety Disclosures 16
Item 5. Other Information 16
Item 6. Exhibits 16
SIGNATURES 17
2
PART I - FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
AMERICAN SOIL TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
June 30, 2013 September 30, 2012
------------- ------------------
Assets:
Current assets
Cash and cash equivalents $ 12,043 $ 3,846
Accounts receivable, net of allowance of $35,088 at
June 30, 2013 and September 30, 2012, 14,725 387
Inventories 4,934 5,144
Prepaid and other current assets 676 1,235
------------ ------------
Total current assets 32,378 10,612
Property and equipment, net 111 219
Intangible assets 20,723 51,808
------------ ------------
Total assets $ 53,212 $ 62,639
============ ============
Liabilities and Stockholders' Deficit:
Current liabilities
Accounts payable $ 1,483,192 $ 1,678,065
Accrued liabilities 3,121,470 2,708,576
Notes payable 1,919,585 1,919,585
Notes payable to related parties 1,228,866 1,149,866
------------ ------------
Total liabilities 7,753,113 7,456,092
------------ ------------
Stockholders' deficit:
Series A preferred stock, $0.50 stated value, 25,000,000 shares authorized,
2,763,699 shares issued and outstanding at June 30, 2013 and
September 30, 2012, respectively 1,381,849 1,381,849
Common stock, $0.001 par value, 100,000,000 shares authorized,
68,090,590 shares issued and outstanding at June 30, 2013 and
September 30, 2012, respectively 68,091 68,091
Additional paid-in capital 19,831,800 19,831,800
Accumulated deficit (28,981,641) (28,675,193)
------------ ------------
Total stockholders' deficit (7,699,901) (7,393,453)
------------ ------------
Total liabilities and stockholders' deficit $ 53,212 $ 62,639
============ ============
See accompanying Notes to Consolidated Financial Statements.
3
AMERICAN SOIL TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Three Months Nine Months Nine Months
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2013 2012 2013 2012
------------ ------------ ------------ ------------
Revenue $ 33,558 $ 22,483 $ 55,806 $ 63,586
Cost of goods sold (excluding
amortization of intangible assets) 19,065 9,958 22,086 23,000
------------ ------------ ------------ ------------
Gross profit 14,493 12,525 33,720 40,586
------------ ------------ ------------ ------------
Operating expenses:
General and administrative 122,226 133,988 372,701 406,963
Sales and marketing 75 -- 224 231
Amortization of intangible assets 10,362 10,362 31,085 31,085
------------ ------------ ------------ ------------
Total operating expenses 132,663 144,350 404,010 438,279
------------ ------------ ------------ ------------
Loss from operations (118,170) (131,825) (370,290) (397,693)
Other (income) expense:
Interest expense 26,135 26,333 78,218 78,124
Gain on extinguishment of debt -- -- (142,060) --
------------ ------------ ------------ ------------
Loss before income taxes (144,305) (158,158) (306,448) (475,817)
Provision for income taxes -- -- -- --
------------ ------------ ------------ ------------
Net loss $ (144,305) $ (158,158) $ (306,448) $ (475,817)
============ ============ ============ ============
Net loss per share basic and diluted $ (0.00) $ (0.00) $ (0.00) $ (0.01)
============ ============ ============ ============
Weighted average common shares outstanding
used in per share calculations 68,090,590 68,090,590 68,090,590 68,090,590
============ ============ ============ ============
See accompanying Notes to Consolidated Financial Statements.
4
AMERICAN SOIL TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine Months Nine Months
Ended Ended
June 30, June 30,
2013 2012
---------- ----------
Cash flows from operating activities:
Net loss $ (306,448) $ (475,817)
Adjustments to reconcile net loss to net cash
Gain on extinguishment of liabilities (142,060) --
Depreciation and amortization 31,193 31,492
Changes in operating assets and liabilities:
Accounts receivable (14,338) 18,917
Inventory 210 361
Prepaid expenses and other assets 559 344
Accounts payable (52,813) (15,226)
Accrued expenses 412,894 412,042
---------- ----------
Net cash used in operating activities (70,803) (27,887)
---------- ----------
Cash flows from financing activities:
Proceeds from related party notes 79,000 45,000
---------- ----------
Net cash provided by financing activities 79,000 45,000
---------- ----------
Net increase in cash and cash equivalents 8,197 17,113
Cash and cash equivalents at beginning of period 3,846 4,356
---------- ----------
Cash and cash equivalents at end of period $ 12,043 $ 21,469
========== ==========
See accompanying Notes to Consolidated Financial Statements.
5
AMERICAN SOIL TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2013
(UNAUDITED)
1. BUSINESS
The Company is primarily engaged in the marketing of polymer and other soil
amendments to the agricultural turf and horticulture industries. The Company's
products are used to decrease water usage, increase nutrient retention in soil,
enhance seed germination and sprout emergence, clarify ponds and increase the
effectiveness of chemical fertilizers and biological additives. In 2006, the
Company acquired the patent to a slow release fertilizer. The Company also has
exclusive license rights to the use of patented polymer application techniques,
as well as numerous patents on a unique machine designed to inject polymer and
other liquid products into existing turf and some crops.
The Company has a wholly owned subsidiary, Smart World Organics, Inc. (Smart
World) which has insignificant operations. The Company has several debt
obligations that are past the contractual maturity date or are due and payable
due to non payment of interest.
2. GOING CONCERN AND MANAGEMENT'S PLAN
The Company has sustained significant losses and has an accumulated deficit of
$28,981,641 and negative working capital of $7,720,735 as of June 30, 2013. The
ability of the Company to continue as a going concern is dependent upon
obtaining additional capital and financing, and ultimately generating positive
cash flows from operations. Management intends to seek additional capital either
through debt or equity offerings. Due to the current economic environment and
the Company's current financial condition, management cannot be assured there
will be adequate capital available when needed and on acceptable terms. These
factors raise substantial doubt about the Company's ability to continue as a
going concern. The consolidated financial statements do not include any
adjustments relating to the recoverability and classification of asset carrying
amounts or the amount and classification of liabilities that might result should
the Company be unable to continue as a going concern.
3. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The consolidated financial statements of the Company are unaudited and have been
prepared in accordance with accounting principles generally accepted in the
United States of America for interim financial information, pursuant to the
rules and regulations of the Securities and Exchange Commission. Notes to the
consolidated financial statements which would substantially duplicate the
disclosures contained in the audited financial statements for the most recent
fiscal year 2012 as reported in the Company's Form 10-K have been omitted. The
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results of operations for the three and nine month periods ended June 30, 2013
and 2012 are not necessarily indicative of the results to be expected for the
full year. In the opinion of management, the consolidated financial statements
include all adjustments, consisting of normal recurring accruals, necessary to
present fairly the Company's financial position, results of operations and cash
flows. These statements should be read in conjunction with the financial
statements and related notes which are part of the Company's Annual Report on
Form 10-K for the year ended September 30, 2012.
USE OF ESTIMATES
The preparation of consolidated financial statements in conformity with
accounting principles generally accepted in the United States of America,
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting periods. Actual results could differ
from those estimates. The Company's significant estimates made in connection
with the preparation of the accompanying financial statements include the
carrying value of the intangible assets.
CONCENTRATION OF CREDIT RISK
Accounts receivable from individual customers representing 100% or more of the
net accounts receivable balance consists of the following as of June 30:
2013 2012
---- ----
Percent of accounts receivable 100% 59%
Number of customers 2 2
Sales from individual customers representing 10% or more of sales consist of the
following customers for the three months ended June 30:
2013 2012
---- ----
Percent of sales 98% 90%
Number of customers 3 2
Sales from individual customers representing 10% or more of sales consist of the
following customers for the nine months ended June 30:
2013 2012
---- ----
Percent of sales 97% 100%
Number of customers 3 2
7
As a result of the Company's concentration of its customer base, the loss or
cancellation of business from, or significant changes in scheduled deliveries of
product sold to the above customer or a change in their financial position could
materially and adversely affect the Company's consolidated financial position,
results of operations and cash flows.
NET LOSS PER SHARE
Basic net loss per share is calculated by dividing net loss by the weighted
average common shares outstanding during the period. Diluted net loss per share
reflects the potential dilution to basic net loss per share that could occur
upon conversion or exercise of securities, options or other such items to common
shares using the treasury stock method, based upon the weighted average fair
value of our common shares during the period. For each period presented, basic
and diluted net loss per share amounts are identical as the effect of potential
common shares is antidilutive.
The following is a summary of outstanding securities which have been excluded
from the calculation of diluted net loss per share because the effect would have
been antidilutive for the three and nine months ended June 30:
2013 2012
--------- ---------
Series A convertible preferred stock 2,763,699 2,763,699
--------- ---------
2,763,699 2,763,699
========= =========
In addition, the company excluded zero and 1,976,000 options from the
computation as of June 30, 2013 and 2012, respectively, as the option exercise
prices were in excess of the average market price of the Company's common stock
during the respective periods.
NEW ACCOUNTING PRONOUNCEMENTS
The FASB issues ASUs to amend the authoritative literature in ASC. There have
been a number of ASUs to date that amend the original text of ASC. The Company
believes those issued to date either (i) provide supplemental guidance, (ii) are
technical corrections, (iii) are not applicable to the Company or (iv) are not
expected to have a significant impact on the Company.
4. INVENTORIES
Inventories consist of the following at:
June 30, 2013 September 30, 2012
------------- ------------------
Finished goods $ 4,934 $ 5,144
-------- --------
$ 4,934 $ 5,144
======== ========
8
5. DEBT MITIGATION PROGRAM
The Company has significant liabilities that have been incurred due to continued
operating losses and the acquisition of Smart World in 2006. In order to attract
potential capital, the Company has conducted analysis on past due obligations to
creditors. We determined that the statute of limitations for certain of our
creditors to enforce collection of any amounts they might be owed has now
elapsed. Based on our determinations and findings, during the nine months ended
June 30, 2013, we have eliminated $142,060 in creditor liabilities which were
all previously included in accounts payable in the accompanying balance sheet.
The Company will continue to conduct analysis on creditor obligations to
determine when and if they are no longer enforceable.
6. ACCRUED EXPENSES
Accrued expenses consist of the following at:
June 30, 2013 September 30, 2012
------------- ------------------
Interest $ 449,122 $ 415,861
Interest to related parties 291,924 252,086
Compensation and related 2,380,424 2,040,629
---------- ----------
$3,121,470 $2,708,576
========== ==========
7. NOTES PAYABLES AND RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS
During the three months ended June 30, 2013, the Company's secretary, Ms. Visco
loaned the Company an additional $30,000 for working capital. The previous note
for $883,842 was amended to increase the principal due to $913,842. The
principal is due in May 2014 and interest is payable monthly, at prime rate. The
note is currently in default for non-payment of interest.
8. COMMON STOCK
STOCK OPTIONS
All stock options expired in September and November 2012. There were no
issuances of common stock, options or warrants during the period presented in
fiscal 2012.
9. LITIGATION
On or about September 21, 2007, Stockhausen, Inc. ("Stockhausen") filed a
Complaint in the United States District Court, for the Middle District of North
Carolina, against us seeking damages. The parties entered into a settlement
agreement on June 2, 2010. Under the settlement agreement, we agreed to pay
9
Stockhausen $250,000 on or before June 23, 2010 as a compromise to Stockhausen's
claims that currently total $603,921. We further agreed that we would consent to
the entry of a Judgment against us in favor of Stockhausen in the amount of
$603,921 if we failed to make complete and timely payment as agreed. The Company
was unable to make the agreed upon payment and on July 8, 2010 Stockhausen
entered a judgment for the above stated amount against the Company.
On or about October 4, 2007, Raymond J. Nielsen and Cheryl K. Nielsen
(collectively, "Plaintiffs"), filed a Complaint in the Circuit Court in the
Sixth Judicial District of Pasco County, Florida, against us and Smart World
(collectively "Defendants") seeking damages, declaratory, and injunctive relief.
Plaintiffs allege that Defendants failed to pay interest when due on the
Convertible Debenture from Defendants to Plaintiffs and, thus, the entire amount
of the Convertible Debenture is accelerated and Plaintiffs are seeking a
judgment in the amount of $1,500,000 plus interest. On December 29, 2009, the
matter was settled for $400,000 and the Company had 60 days in which to remit
the amount or a judgment in the entire amount claimed will be entered against
us. The Company was not able to meet the terms of the settlement and have been
actively communicating with the Plaintiffs to extend the terms of the
settlement. On February 21, 2011, we agreed to pay interest on the settlement
amount at 4% per annum.
To the best knowledge of our management, there are no other significant legal
proceedings pending against us.
10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis should be read in conjunction with our
financial statements, including the notes thereto, appearing elsewhere in this
Report.
FORWARD-LOOKING STATEMENTS
The following information contains certain forward-looking statements.
Forward-looking statements are statements that estimate the happening of future
events and are not based on historical fact. Forward-looking statements may be
identified by the use of forward-looking terminology, such as "may," "could,"
"expect," "estimate," "anticipate," "plan," "predict," "probable," "possible,"
"should," "continue," or similar terms, variations of those terms or the
negative of those terms. The forward-looking statements specified in the
following information have been compiled by our management on the basis of
assumptions made by management and considered by management to be reasonable.
Our future operating results, however, are impossible to predict and no
representation, guaranty, or warranty is to be inferred from those
forward-looking statements.
OVERVIEW
We develop, manufacture and market cutting-edge technology that decreases the
need for water and improves the soil in the "Green Industry" consisting of
agriculture, turf and horticulture.
RESULTS OF OPERATIONS
The following table sets forth, for the periods indicated, our selected
financial information:
Nine Months Nine Months
Ended Ended
June 30, June 30,
2013 2012
------------ ------------
(Unaudited) (Unaudited)
STATEMENT OF OPERATIONS DATA:
Revenue $ 55,806 $ 63,586
Net Loss (306,448) (475,817)
Net Loss per Share $ (0.00) $ (0.01)
June 30, September 30,
2013 2012
------------ ------------
(Unaudited)
BALANCE SHEET DATA:
Current Assets $ 32,378 $ 10,612
Total Property & Equipment, Net 111 219
Intellectual Property, Net 20,723 51,808
Total Assets 53,212 62,639
Total Current Liabilities 7,753,113 7,456,092
Accumulated Deficit $(28,981,641) $(28,675,193)
11
NINE MONTHS ENDED JUNE 30, 2013 COMPARED TO NINE MONTHS ENDED JUNE 30, 2012
REVENUES
Revenues for the nine months ended June 30, 2013 were $55,806 compared to
$63,586 for the nine months ended June 30, 2012, a decrease of 12%. This
decrease in revenue is a direct result of the temporary loss of sales of all but
one of our proprietary products. Lack of funds reduces are efforts in sales and
marketing.
COST OF SALES
Cost of goods sold decreased to $22,086 for the nine months ended June 30, 2013
from $23,000, for the nine months ended June 30, 2012. The decrease in the cost
of sales is the result of a decrease in revenue during this period. Our gross
margins were 60% and 64% for the nine months ended June 30, 2013 and 2012,
respectively. The decrease in our gross margins was due to a decrease in the
proportion of revenues from royalties as opposed to sales of product in the
current period. Revenues associated with royalties have relatively minor costs
when compared to the costs of product sales.
OPERATING EXPENSES
Operating expenses decreased 8% to $404,010 from $438,279 for the nine month
period ended June 30, 2013 and 2012, respectively.
This decrease in operating expenses was a result of decreased operations. Our
general and administrative expenses decreased to $372,701 for the nine months
ended June 30, 2013 from $406,963 for the nine months ended June 30, 2012 due to
the continued reduction in rent and certain administrative costs.
NET LOSS
We experienced a net loss from operations of $306,448 for the nine months ended
June 30, 2013 as compared to a net loss of $475,817 for the nine months ended
June 30, 2012. The decrease in net loss was primarily a result of the gain
realized in the amount of $142,060 for the extinguishment of liabilities. As
part of our debt mitigation program, we reviewed our long outstanding
liabilities for, among other things, the expiration of the Statute of
Limitations for creditors to make claims on amounts owed. The analysis was based
on applicable law in the state where the liability originated. The Company will
continue to analyze past due payables in future periods.
LIQUIDITY AND CAPITAL RESOURCES
Cash and cash equivalents totaled $12,043 at June 30, 2013. Net cash used in
operating activities was $70,803 for the period ended June 30, 2013 compared to
$27,887 during the period ended June 30, 2012. Net cash provided by financing
12
activities was $79,000, for the period ended June 30, 2013 compared to $45,000
for the comparable period ended June 30, 2012. We have historically relied upon
one of our officers and significant shareholders to provide cash to meet short
term operating cash requirements.
At June 30, 2013, the outstanding balance of all notes payable was $3,148,451.
The notes payable include: a) debenture of $1,500,000, 8% per annum (b) various
debentures totaling $419,585 with interest per annum from 8-10%; (c) a loan from
an officer and shareholder for $913,842 bearing interest at prime; (d) various
loans from related parties totaling $315,024 bearing interest from prime to 12%.
Interest expense for the nine months ended June 30, 2013 and 2012 was $78,218
and $78,124, respectively.
We have a working capital deficit $7,720,735 as of June 30, 2013 compared to
working capital deficit of $7,287,975 as of September 30, 2012. Our increase in
current liabilities is directly related to an increase in our notes payable and
accrued liabilities.
As shown in the accompanying financial statements, we have incurred an
accumulated deficit of $28,981,641 and a working capital deficit of
approximately $7,720,735 as of June 30, 2013. Our ability to continue as a going
concern is dependent on obtaining additional capital and financing and operating
at a profitable level. We intend to seek additional capital either through debt
or equity offerings and to increase sales volume and operating margins to
achieve profitability. Our working capital and other capital requirements during
the next fiscal year and thereafter will vary based on the sales revenue
generated.
We will consider both the public and private sale of securities and/or debt
instruments for expansion of our operations if such expansion would benefit our
overall growth and income objectives. Should sales growth not materialize, we
may look to these public and private sources of financing. There can be no
assurance, however, that we can obtain sufficient capital on acceptable terms,
if at all. Under such conditions, failure to obtain such capital likely would at
a minimum negatively impact our ability to timely meet our business objectives.
Our auditors issued an explanatory paragraph regarding substantial doubt about
the Company's ability to continue as a going concern in our most recent 10-K for
the year ended September 30, 2012.
13
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable
ITEM 4. CONTROLS AND PROCEDURES
We maintain disclosure controls and procedures that are designed to provide
reasonable assurance that information required to be disclosed in our Exchange
Act reports is recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms and that such information is
accumulated and communicated to our management, including our Chief Executive
Officer, as appropriate, to allow timely decisions regarding required
disclosure. In designing and evaluating the disclosure controls and procedures,
management recognizes that any controls and procures, no matter how well
designed and operated, can provide only reasonable assurance of achieving the
desired control objectives and in reaching a reasonable level of assurance
management necessarily was required to apply its judgment in evaluating the cost
benefit relationship of possible controls and procedures.
Our President and Chief Financial Officer (the "Certifying Officers") Is
responsible for establishing and maintaining our disclosure controls and
procedures. The Certifying Officer has designed such disclosure controls and
procedures to ensure that material information is made known to him particularly
during the period in which this report was prepared. The Certifying Officer has
evaluated the effectiveness of our disclosure controls and procedures and has
determined that they are effective.
There has been no other change in our internal controls over financial reporting
during our most recent fiscal quarter that has materially affected, or is
reasonably likely to materially affect, our internal controls over financial
reporting.
ITEM 4T. CONTROLS AND PROCEDURES
Not applicable
14
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On or about September 21, 2007, Stockhausen, Inc. ("Stockhausen") filed a
Complaint in the United States District Court, for the Middle District of North
Carolina, against us seeking damages. The parties entered into a settlement
agreement on June 2, 2010. Under the settlement agreement, we agreed to pay
Stockhausen $250,000 on or before June 23, 2010 as a compromise to Stockhausen's
claims that currently total $603,921. We further agreed that we would consent to
the entry of a Judgment against us in favor of Stockhausen in the amount of
$603,921 if we failed to make complete and timely payment as agreed. The company
was unable to make the agreed upon payment, and on July 8, 2010, Stockhausen
entered a judgment for the above stated amount against the company.
On or about October 4, 2007, Raymond J. Nielsen and Cheryl K. Nielsen
(collectively, "Plaintiffs"), filed a Complaint in the Circuit Court in the
Sixth Judicial District of Pasco County, Florida, against us and Smart World
(collectively "Defendants") seeking damages, declaratory, and injunctive relief.
Plaintiffs allege that Defendants failed to pay interest when due on the
Convertible Debenture from Defendants to Plaintiffs, and, thus, the entire
amount of the Convertible Debenture is accelerated and Plaintiffs are seeking a
judgment in the amount of $1,500,000 plus interest. On December 29, 2009, the
matter was settled for $400,000 and the Company had 60 days in which to remit
the amount or a judgment in the entire amount claimed will be entered against
us. The Company was not able to meet the terms of the settlement and have been
actively communicating with the Plaintiffs to extend the terms of the
settlement.
To the best knowledge of our management, there are no other legal proceedings
pending against us.
ITEM 1A. RISK FACTORS
Not applicable.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
15
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS
The following Exhibits are filed herein:
No. Title
--- -----
31.1 Certification of Chief Executive Officer Pursuant to the Securities
Exchange Act of 1934, Rules 13a-14 and 15d-14, as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
31.2 Certification of Chief Financial Officer Pursuant to the Securities
Exchange Act of 1934, Rules 13a-14 and 15d-14, as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
32 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
101 Interactive data files pursuant to Rule 405 of Regulation S-T
16
SIGNATURES
In accordance with the Exchange Act, the registrant caused this report to be
signed on its behalf by the undersigned, duly authorized.
DATED: August 12, 2013 AMERICAN SOIL TECHNOLOGIES, INC.
By: /s/ Carl P. Ranno
-----------------------------------
Carl P. Ranno
Its: President, Chief Executive Officer,
Chief Financial Officer
(Principal Executive Officer,
Principal Financial Officer and
Principal Accounting Officer)
1