SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB |X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period ended June 30, 2003 OR |_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 33-18099-NY and 33-23169-NY QUEST PRODUCTS CORPORATION (Exact Name of small business issuer as specified in its charter) DELAWARE 11-2873662 State or other jurisdiction of (IRS Employer I.D. No.) Incorporation or organization) 6900 Jericho Turnpike, Syosset, New York 11791 (Address of principal executive offices) Issuer's telephone number, including area code: (516) 364 - 3500 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934, during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES |X| NO |_| Indicate the number of shares outstanding of each of the issuer's classes of Common Stock, as of the last practicable date. Class Outstanding at June 30, 2003 ----------------------- ---------------------------- Common Stock, par value 233,038,334 $.00003 per share QUEST PRODUCTS CORPORATION AND SUBSIDIARIES INDEX PART 1 - FINANCIAL INFORMATION Page ---- Item 1 Consolidated Financial Statements Report of Independent Accountants 3 Consolidated Balance Sheet (unaudited) 4 - 5 Consolidated Statements of Operations (unaudited) 6 - 7 Consolidated Statements of Cash Flows (unaudited) 8 Notes to Consolidated Financial Statements 9 - 12 Item 2 Management's Discussion and Analysis 13 - 15 Item 3 Controls and Procedures 15 PART II - OTHER INFORMATION Item 1 Legal Proceedings 15 Item 2 Changes in Securities 16 Item 3 Defaults upon Senior Securities 16 Item 4 Submission of Matters to a Vote of Security Holders 16 Item 5 Other Information 16 Item 6 Exhibits and Reports on Form 8-K 17 Signatures 17 2 PART I - FINANCIAL INFORMATION Item 1. Consolidated Financial Statements REPORT OF INDEPENDENT ACCOUNTANTS To the Board of Directors and Stockholders Quest Products Corporation and Subsidiaries We have reviewed the accompanying consolidated balance sheet of Quest Products Corporation and Subsidiaries as of June 30, 2003 and the related consolidated statements of operations for each of the three and six month periods ended June 30, 2003 and 2002 and consolidated cash flows for the six months ended June 30, 2003 and 2002 as set forth in the accompanying unaudited consolidated financial statements. These consolidated financial statements are the responsibility of the Company's management. We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States of America, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made in the accompanying consolidated financial statements for them to be in conformity with accounting principles generally accepted in the United States of America. The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has had recurring net operating losses since its inception, has relied upon debt and equity financing to provide funds for operations and, as of June 30, 2003, current liabilities exceed current assets by $1,999,574. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. RAICH ENDE MALTER & CO. LLP East Meadow, New York August 8, 2003 3 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES Consolidated Balance Sheet June 30, 2003 (Unaudited) Assets Current Assets Cash $ 13,866 Inventory 843 Prepaid expenses 383 ---------- 15,092 ---------- Investment in Unconsolidated Subsidiary 1,513 Furniture and Equipment - at cost - net of accumulated depreciation of $65,787 6,186 License - at estimated fair value 1,000 Patents - at cost - net of accumulated amortization of $2,500 7,500 ---------- 16,199 ---------- $ 31,291 ========== See accompanying notes and accountants' report. 4 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES Consolidated Balance Sheet June 30, 2003 (Unaudited) Liabilities and Shareholders' (Deficit) Current Liabilities 1992 convertible debentures - including accrued interest of $11,400 $ 21,400 Accounts payable 291,219 Due to officers and directors 1,343,826 Loans from shareholders - including accrued interest of $33,439 259,929 Accrued expenses and other current liabilities 98,292 ----------- 2,014,666 ----------- Deferred rent payable 6,676 Commitments and Contingencies Shareholders' (Deficit) Convertible Preferred Stock - par value $.00003 - authorized 10,000,000 shares - no shares issued and outstanding -- Common Stock - par value $.00003 - authorized 390,000,000 shares - 233,038,334 shares issued and outstanding 6,991 Capital in excess of par 6,073,233 Accumulated (deficit) (8,070,275) ----------- (1,990,051) ----------- $ 31,291 =========== See accompanying notes and accountants' report. 5 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations (Unaudited) For the Six Months Ended June 30, -------------------------------- 2003 2002 -------------------------------- Sales - net $ 7,862 $ 4,282 Cost of Sales 968 279 ------------- ------------- 6,894 4,003 ------------- ------------- Research and Development Expenses 78,928 78,550 Selling Expenses 12,573 17,569 General and Administrative Expenses 238,680 259,189 ------------- ------------- 330,181 355,308 ------------- ------------- (Loss) Before Other Income (Expenses) (323,287) (351,305) ------------- ------------- Other Income (Expenses) Write-off of discount on debt -- (34,000) Interest (expense) (10,375) (7,095) Loss on investment in unconsolidated subsidiary (82) (82) ------------- ------------- (10,457) (41,177) ------------- ------------- Net (Loss) $ (333,744) $ (392,482) ============= ============= Basic and Diluted Net (Loss) Per Share $ NIL $ NIL ============= ============= Weighted Average Number of Shares Outstanding (to nearest 1,000,000) 233,000,000 232,000,000 ============= ============= See accompanying notes and accountants' report. 6 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations (Unaudited) For the Quarter Ended June 30, -------------------------------- 2003 2002 -------------------------------- Sales - net $ 2,670 $ 1,784 Cost of Sales 242 118 ------------- ------------- 2,428 1,666 ------------- ------------- Research and Development Expenses 38,295 36,575 Selling Expenses 4,888 8,278 General and Administrative Expenses 124,972 118,372 ------------- ------------- 168,155 163,225 ------------- ------------- (Loss) Before Other Income (Expenses) (165,727) (161,559) ------------- ------------- Other Income (Expenses) Write-off of discount on debt -- -- Interest (expense) (5,520) (3,950) Loss on investment in unconsolidated subsidiary (41) (41) ------------- ------------- (5,561) (3,991) Net (Loss) $ (171,288) $ (165,550) ============= ============= Basic and Diluted Net (Loss) Per Share $ NIL $ NIL ============= ============= Weighted Average Number of Shares Outstanding (to nearest 1,000,000) 233,000,000 228,000,000 ============= ============= See accompanying notes and accountants' report. 7 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flows (Unaudited) For the Six Months Ended June 30, ------------------------ 2003 2002 ------------------------ Cash Flows from Operating Activities Net (loss) $(333,744) $(392,482) Adjustments to reconcile net (loss) to net cash (used for) operating activities: Depreciation 2,122 3,788 Amortization 2,500 3,953 Warrants issued for compensation 73,150 73,150 Write-off of discount on debt -- 34,000 Write-off of security deposit 405 -- Equity in net loss of unconsolidated subsidiary 82 82 (Increase) decrease in: Inventories 781 278 Prepaid expenses 91 573 Deferred rent payable 1,331 -- Increase (decrease) in: Accounts payable 21,052 19,024 Accrued interest 10,375 7,095 Accrued officer compensation 167,246 171,230 Accrued expenses and other current liabilities 20,838 (3,846) --------- --------- (33,771) (83,155) --------- --------- Cash Flows from Financing Activities Proceeds from issuance of common stock -- 1,333 Proceeds of loans from shareholders 46,490 48,000 --------- --------- 46,490 49,333 --------- --------- Net Increase (Decrease) in Cash 12,719 (33,882) Cash - beginning 1,147 35,644 --------- --------- Cash - end $ 13,866 $ 1,822 ========= ========= See accompanying notes and accountants' report. 8 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) June 30, 2003 1. BACKGROUND AND STATUS OF THE COMPANY Quest Products Corporation (the "Company") was organized as a Delaware Corporation on July 17, 1987 and operated as a development stage company through 1993. The Company has one wholly-owned subsidiary, The ProductIncubator.Com, Inc. ; and a majority-owned subsidiary, Wynn Technologies, Inc., through which it intends to identify and bring to the marketplace unique proprietary consumer products. The Company also continues to distribute its patented "Phase-Out" system smoking cessation device (the "PhaseOut device") both domestically and internationally. During 1999, the Company entered into a License Agreement with the holders of a patent for the exclusive worldwide license to make, use and sell inventions related to an adjustable lens product such as sunglasses, ski goggles or diving masks. In June 2000, the Company entered into a comprehensive agreement with Opsales and its President and Vice President, Sidney and Dean Friedman, to manufacture and distribute the Company's rotatable variable polarized lenses to be used in the Company's new sunglass product. In January 2001, the Company made its final selection of frame designs for its Rainbow Shades(TM) sunglasses. The initial line of Rainbow Shades(TM) sunglasses consists of three separate frames created and designed in Italy. The Rainbow Shades(TM) sunglasses feature Quest's patented and revolutionary new lens system which allows the wearer to select up to three different lens colors by simply moving a slider on the frame. The slider causes the lens to rotate which, in turn, changes the lens color. With the Rainbow Shades(TM) sunglasses, there is no need to remove or replace the lens. On November 11, 2002 the Board of Directors decided that, until the Company begins to generate revenue from other sources, not to put additional marketing effort into both the PhaseOut and the sunglass projects. As such, the Company determined that the value of the PhaseOut patent, the deferred royalties and the License related to the sunglass project were impaired and were written down to their fair values based on the future cash flows expected from the PhaseOut device and the estimated fair value of the License. During 2000, the Company acquired the rights to and developed a multi-account card system which will allow a subscribing card holder to access all of their Credit card, Debit card, frequent flyer, telephone calling card and other membership accounts by using one plastic "smart" credit card which will be commercialized and marketed under the name "BIG1CARD"(TM). On March 1, 2001, the Company signed a five-year Consulting Agreement with Alex W. Hart to serve as a Special Consultant to the Company on the development and commercialization of the Company's patented BIG1CARD(TM) technology. Quest, through its subsidiary, Wynn Technologies, Inc., owns all rights to the BIG1CARD(TM) patent, U. S. Patent No. 5,859,419. Mr. Hart's duties will be to use his best efforts to locate and approach appropriate organizations to participate in the Company's BIG1CARD(TM) SmartCard project. This will include introducing the Company and assisting in completing agreements with all such organizations. 9 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) June 30, 2003 As part of the BIG1CARD(TM), a new corporation was formed by the Company, named Wynn Technologies Inc. ("Wynn Tech"), which acquired all right, title and interest to the Wynn patent. Therefore, Wynn Technologies Inc. has the exclusive rights in the United States to make, use, offer and sell this new multi-account card system. Wynn Tech is owned 65% by Quest Products Corporation and 35% by Mr. Wynn. The Company's 65% interest is subject to the resolution of certain contingencies. Accordingly, the Company is not currently consolidating this subsidiary. On June 10, 2003, the United States Patent Office issued U.S. Patent No. RE 38,137 on Quest's multiple account smart card system. The new Patent which contains 35 separate claims replaces the Company's original U.S. Patent No. 5,859,419 which had 7 claims. In January 2001, the Company had filed a Reissue Application with the United States Patent Office to add these additional patent claims to the Company's patent for a multiple account smart card system. The new claims were allowed in their entirety. On March 1, 2001, the Company signed a five-year Consulting Agreement with Alex W. Hart to serve as a Special Consultant to the Company on the development and commercialization of Wynn Technologies, Inc.'s patented BIG1CARD(TM) technology. The five-year Consulting Agreement called for Mr. Hart to receive options to purchase 5 million shares of the Company's stock, which can be exercised at any time during the five-year Agreement, either on a cash or cashless basis. Two million options have been issued at $.10; 1 million options issued at $.15; 1 million options at $.20; and 1 million options at $.30. The fair value of these options is being amortized over the life of the consulting agreement. Quest, through its unconsolidated subsidiary, Wynn Technologies, Inc., owns all rights to the BIG1CARD(TM) patent, U. S. Patent No. 5,859,419. Mr. Hart's duties are to use his best efforts to locate and approach appropriate organizations to participate in the Company's BIG1CARD(TM) project. This will include introducing the Company and assisting in completing agreements with all such organizations. The consolidated financial statements have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable length of time. The Company has had recurring net operating losses since its inception and has made use of privately-placed debt and equity financing to provide funds for operations. As of June 30, 2003, current liabilities exceed current assets by $1,999,574. Those factors, as well as the Company's inability thus far to establish a marketable product, create an uncertainty about the Company's ability to continue as a going concern. The Company has intentions of expanding and refining its marketing efforts to include other products. In addition, the Company is continuing its efforts to obtain long-term financing through the issuance of long-term debt and equity securities. The consolidated financial statements do not include any adjustments that might be necessary should the above or other factors affect the Company's ability to continue as a going concern. 10 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) June 30, 2003 2. UNAUDITED INTERIM STATEMENTS The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with the instructions to Form 10-QSB and do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (which consist only of normal recurring adjustments) necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2003 are not necessarily indicative of the results to be expected for the year ending December 31, 2003. These consolidated financial statements and notes should be read in conjunction with the financial statements and notes thereto included in the Company's annual report on Form 10-KSB for the year ended December 31, 2002. Certain amounts from prior years have been restated to conform to the current year's presentation. Those reclassifications have no effect on the previously reported loss. 3. STOCK-BASED COMPENSATION Employees - When stock based compensation is issued to employees and directors in connection with their services as directors, Statement of Financial Accounting Standards ("SFAS") No. 123 Accounting for Stock-Based Compensation, as amended by SFAS No. 148 Accounting for Stock - Based Compensation -Transition and Disclosure, encourages, but does not require companies to record compensation cost for stock-based employee compensation plans at fair value. The Company has chosen to continue to account for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board Opinion ("APB") No. 25, Accounting for Stock Issued to Employees. APB No. 25 requires no recognition of compensation expense for the stock-based compensation arrangements provided by the Company where the exercise price is equal to or greater than the market price at the date of the grants. Non-Employees - When stock based compensation is issued to non-employees, the Company records these transactions at the fair market value of the equity instruments issued or the goods or services received, whichever is more reliably measurable. 11 The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value recognition provisions of SFAS No. 123 Accounting for Stock - Based Compensation, to stock - based employee compensation: For the six months ended June 30, 2003 2002 ---- ---- Net loss, as reported $(333,744) $(392,482) Deduct: total stock - based employee compensation expense determined under fair value based method for all awards, net of related tax effects (51,463) (156,126) --------- --------- $(385,207) $(548,608) --------- --------- Earnings per share (basic and diluted: As reported -0- -0- Pro forma -0- -0- 4. BASIC AND DILUTED EARNINGS (LOSS) PER SHARE Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average numbers of shares of common stock outstanding during the period. Diluted earnings (loss) per share is computed giving effect to all dilutive potential common shares that were outstanding during the period. Dilutive potential common shares consist of the incremental common shares issuable upon the exercise of warrants. For the six months ended June 30, 2003 and 2002, potentially dilutive securities of approximately 1,951,000 and 9,000,000 shares that related to shares issuable upon the exercise of warrants and options granted by the Company were excluded, as their effect was antidilutive. 5. RELATED PARTY TRANSACTIONS AND ISSUANCES OF EQUITY SECURITIES The Company received loans from Shareholders in the amount of $46,490 during the six months ended June 30, 2003. The loans are payable on demand plus accrued interest at 10% per annum. 12 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES Item 2 - Management's Discussion and Analysis The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. All statements other than statements of historical fact in this report are forward-looking statements. Such forward-looking statements are based on the current beliefs of management and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Quest Products Corporation to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: Quest's history of losses; the need to obtain additional financing and the ability to obtain such financing; and uncertainties relating to business and economic conditions in markets in which Quest operates. The words, believe, expect, anticipate, intend and plan and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. The Company intends, through its newly incorporated subsidiaries, to identify and bring to the marketplace, unique proprietary consumer products. Results of Operations Six Months Ended June 30, 2003 Compared to Six Months Ended June 30, 2002 The Company incurred a net loss of $333,744 for the six months ended June 30, 2003 as compared to a loss of $392,482 for the six months ended June 30, 2002. Sales increased by $3,580 from $4,282 in 2002 to $7,862 in 2003 as a result of a increase in international sales. The Company`s sales continue to be primarily generated via e-commerce. The Company sold 485 PhaseOut units in 2003 at an average price of approximately $16 per unit and 173 PhaseOut units in 2002 at an average price of approximately $20 per unit. The average cost per unit sold in 2003 and 2002 remained $1.61 plus shipping and handling. The Company's research and development expenses were approximately $79,000 in both 2003 and 2002. The Company's selling expenses decreased by $4,996 from $17,569 in 2002 to $12,573 in 2003. This decrease is primarily due to a decrease in travel -related expenses. The Company's general and administrative expenses decreased by $20,509 from $259,189 in 2002 to $238,680 in 2003. This decrease is attributable to a decrease in salaries, insurance and rent, net of sublease income. Interest expense increased by $3,280 from $7,095 in 2002 to $10,375 in 2003 due to interest on additional loans from shareholders received during the fourth quarter of 2002 and the first and second quarter of 2003. 13 QUEST PRODUCTS CORPORATION AND SUBSIDIARIES Management's Discussion and Analysis Liquidity and Capital Resources The Company has a working capital deficit at June 30, 2003 of $1,999,574 as compared to a working capital deficit at December 31, 2002 of $1,745,420. During the six months ended June 30, 2003, the Company used $33,812 in operating activities and generated $46,490 from financing activities from loans from officers. The Company currently has $13,866 in cash. The Company's working capital deficiency increased primarily due to accrued officers compensation and loans from shareholders. Working capital and current ratios were: June 30, December 31, 2003 2002 ---- ---- Working capital (deficiency) $(1,999,574) $(1,745,420) Current ratios 0.002:1 0.02:1 In order to meet short-term marketing goals, in July 1997 certain officers and directors agreed to acquire an aggregate of 10,000,000 shares of the Company's common stock (representing 8% of total shares outstanding) for an aggregate purchase price of $100,000. Through December 31, 2002, the Company received $1,158,700 of financing under the same terms offered to the Directors and Officers. There is no assurance that the Company will be able to obtain additional financing. In October 1999, the Company successfully completed development of adjustable polarized sunglasses which allow the wearer to change the color of the sunglass lenses to a variety of colors without changing the lenses or altering the frame. Cash paid for further research and development expenditures related to the sunglass project is not expected to exceed $50,000 during 2003. During 2000, the Company acquired the rights to and developed a multi-account card system which will allow a subscribing card holder to access all of their Credit card, Debit card, frequent flyer, telephone calling card and other membership accounts by using one plastic "smart" credit card which will be commercialized and marketed under the name "BIG1CARD"(TM). On March 1, 2001, the Company signed a five-year Consulting Agreement with Alex W. Hart to serve as a Special Consultant to the Company on the development and commercialization of the Company's patented BIG1CARD(TM) technology. Quest, through its unconsolidated subsidiary, Wynn Technologies, Inc., subject to the resolution of certain contingencies, owns all rights to the BIG1CARD(TM) patent, U. S. Patent No. 5,859,419. Mr. Hart's duties will be to use his best efforts to locate and approach appropriate organizations to participate in the Company's BIG1CARD(TM) SmartCard project. This will include introducing the Company and assisting in completing agreements with all such organizations. The Company believes the issuance of the enhanced patent on the Big1Card will give it the ability to raise additional funds through revenue, debt or equity financing, which, in turn will enable it to expand and refine its marketing efforts to improve the efficiency of these efforts and to increase revenues for its other products. 14 On June 10, 2003, the United States Patent Office issued U.S. Patent No. RE 38,137 on Quest's multiple account smart card system. The new Patent which contains 35 separate claims replaces the Company's original U.S. Patent No. 5,859,419 which had 7 claims. In January 2001, the Company filed a Reissue Application with the United States Patent Office to add these additional patent claims to the Company's patent for a multiple account smart card system. The new claims were allowed in their entirety. The Company's management believes the Patent Office action allowing these additional 28 claims significantly broadens and strengthens the Company's patent and materially increases its value in the marketplace. The new claims allowed by the Patent Office, when combined with the original claims, make it extremely unlikely that a competitor will be able to design around or otherwise circumvent the Company's patent in launching a smart card multi-account credit card system and best insures that no one else in the United States will be able to commercialize a multi-account credit card system without obtaining license rights from the Company. The Company's patent which has a 1995 priority date is, to their knowledge, the only U.S. patent which covers a multi-account credit card system employing a processing chip and on-board memory. In addition, Quest Products Corporation is in the process of contacting corporations in order to apply the Company's patented multi-account credit card system to the myriad of security issues facing Government and industry. Cash paid for further research and development expenditures related to the BIG1CARD(TM) smart card project in 2003 is not expected to exceed $25,000. ITEM 3. CONTROLS AND PROCEDURES The Company, under the supervision of the chief executive and chief financial officers, has conducted an evaluation of the effectiveness of the design and operation of the Company's disclosure controls and procedures within 90 days of the filing date of this quarterly report. Based upon the results of this evaluation, the chief executive and chief financial officers believe that the Company maintains proper procedures for gathering, analyzing and disclosing all information in a timely fashion that is required to be disclosed in its Exchange Act reports. There have been no significant changes in the Company's controls subsequent to the evaluation date. PART II - OTHER INFORMATION Item 1. Legal Proceedings None 15 Item 2. Changes in Securities Recent Sales of Unregistered Securities During the six months ended June 30, 2003, we made the following sales of unregistered securities: Consideration Received and If Option, Warrant Description of Underwriting or Convertible or Other Discounts to Exemption from Security, Terms of Date of Type of Number Market Price Afforded to Registration Exercise or Sale Security Sold Purchasers Claimed Conversion ---- -------- ---- ---------- ------- ---------- 2/15/03 Warrant 2,250,000 Warrants issued to Directors in 4(2) Exercisable through connection with Board February 15, 2006 at services. No cash consideration an exercise price of received until exercise. $.015 per share. 5/29/03 Warrant 3,500,000 Warrants issued to Directors in 4(2) Exercisable through connection with Board May 29, 2008 at an services. No cash consideration exercise price of received until exercise. $.015 per share. Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matters to a Vote of Security Holders None Item 5. Other Information None 16 Item 6. Exhibits and Reports on Form 8-K A) Exhibits 31.1 - Certification of CEO pursuant to Section 302 of Sarbanes-Oxley Act of 2002 31.2 - Certification of CFO pursuant to Section 302 of Sarbanes-Oxley Act of 2002 32.1 - Certification of CEO pursuant to Section 906 of Sarbanes-Oxley Act of 2002 32.2 - Certification of CFO pursuant to Section 906 of Sarbanes-Oxley Act of 2002 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. QUEST PRODUCTS CORPORATION Dated: August 12, 2003 /s/ Herbert M. Reichlin ------------------------------------ Herbert M. Reichlin, President 17