10-Q 1 g8151a.txt 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 December 31, 2015 [ ] 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.) 9018 Balboa Ave. #558, Northridge, CA 91325 (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 February 19, 2016, 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 ------ PART I - FINANCIAL INFORMATION Item 1. Consolidated Financial Statements (Unaudited) 3 Consolidated Balance Sheets - December 31, 2015 and September 30, 2014 3 Consolidated Statements of Operations - For the three ended December 31, 2015 and 2014 4 Consolidated Statements of Cash Flows - For the three months ended December 31, 2015 and 2014 5 Notes to Consolidated Financial Statements 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Item 3. Qualitative and Quantitative Disclosures About Market Risk 10 Item 4. Controls and Procedures 11 Item 4T. Controls and Procedures 11 PART II - OTHER INFORMATION Item 1. Legal Proceedings 11 Item 1A. Risk Factors 12 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 12 Item 3. Defaults Upon Senior Securities 12 Item 4. Mine Safety Disclosures 12 Item 5. Other Information 12 Item 6. Exhibits 12 SIGNATURES 12 2 PART I - FINANCIAL INFORMATION ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) AMERICAN SOIL TECHNOLOGIES, INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED)

~~June~~December 3031, September 30, 2015 ~~2014~~2015 ------------ ------------ Assets: Current assets Cash and cash equivalents $ 31,~~596~~912 $ 34,~~157~~531 Accounts receivable, net of allowance of $35,088 at ~~June~~December 3031, 2015 and September 30, ~~2014~~2015, respectively -- 4,446 ~~1,403~~ Prepaid expenses and other current assets 676 676 ------------ ------------ Total assets $ 82,~~718~~588 $ 59,~~236~~653 ============ ============ Liabilities and Stockholders' Deficit: Current liabilities Accounts payable $ 1,~~399~~365,~~834~~365 $ 1,~~401~~396,~~376~~382 Accrued liabilities 34,~~921~~064,~~922~~056 34,~~533~~051,~~308~~835 Notes payable 1,747,585 1,747,585 Notes payable to related parties 1,~~134~~160,842 1,~~097~~146,842 ------------ ------------ Total liabilities 8,~~204~~337,~~183~~848 78,~~780~~342,~~111~~644 ------------ ------------ Stockholders' deficit: Series A preferred stock, $0.50 stated value, 25,000,000 shares authorized, 2,763,699 shares issued and outstanding at ~~June~~December 3031, 2015 and September 30, ~~2014~~2015, 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~~December 3031, ~~2014~~2015 and September 30, ~~2014~~2015, respectively 68,091 68,091 Additional paid-in capital 19,831,800 19,831,800 Accumulated deficit (29,~~477~~617,~~206~~000) (29,~~056~~614,~~615~~731) ------------ ------------ Total stockholders' deficit (8,~~195~~335,~~466~~260) (78,~~774~~332,~~875~~991) ------------ ------------ Total liabilities and stockholders' deficit $ 82,~~718~~588 $ 59,~~236~~653 ============ ============

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~~December ~~Ended June 30~~31, ~~June~~December 3031, ~~June 30, June 30,~~ 2015 2014 ~~2015 2014~~ ------------ ------------ ~~------------ ------------~~ Revenue $ ~~3,043~~-- $ ~~2,575~~-- ~~$ 3,043 $ 29,568~~ Cost of goods sold ~~(excluding amortization of intangible assets) 3,395 822 5,045 4,093~~ --~~----------~~ ~~------------~~922 ------------ ------------ Gross profit (~~352~~loss) ~~1,753~~-- (~~2,002~~922) ~~25,475~~ ------------ ------------ ~~------------ ------------~~ Operating expenses: General and administrative ~~123~~8,~~517~~861 ~~119~~117,~~306~~324 ~~367,103 368,005 Sales and marketing~~ -- -- -- ~~125 Amortization of intangible assets~~ -- -- -- ~~10,362~~ ------------ ~~------------ ------------ ------------~~ Total operating expenses ~~123~~8,~~517~~861 ~~119~~117,~~306~~324 ~~367,103 378,492~~ ------------ ------------ ~~------------ ------------~~ Loss from operations (~~123~~8,~~869~~861) (~~117~~118,~~553~~246) ~~(369,105) (353,017)~~ Other (income) expense: Interest expense 17,~~222~~444 17,~~144~~314 ~~51,485 60,415~~ Gain on Extinguishment of Debt ~~-- -- --~~ (~~635~~24,~~903~~036) --~~----------~~ ------------ ------------ ~~------------~~ Income (loss) before income taxes (~~141~~2,~~092~~269) (~~134~~135,~~697~~560) ~~(420,591) 222,471~~ Provision for income taxes -- -- -- -- --------~~----~~ ------------ ~~------------ ------------ Net~~ Income (loss) $ (~~141~~2,~~092~~269) $ (~~134~~135,~~697~~560) ~~$ (420,591) $ 222,471~~ ============ ============ ~~============ ============~~ Net ~~income (~~loss) per share basic $and ~~(0.00) $ (0.00) $ (0.01) $ 0.00 ============ ============ ============ ============ Net income (loss) per share~~ diluted $ (0.00) $ (0.00) ~~$ (0.01) $ 0.00~~ ============ ============ ~~============ ============~~ Weighted average common shares outstanding used in per share calculations - basic ~~68,090,590~~and ~~68,090,590 68,090,590 68,090,590 ============ ============ ============ ============ Weighted average common shares outstanding used in per share calculations -~~ diluted 68,090,590 68,090,590 ~~68,090,590 70,854,289~~ ============ ============ ~~============ ============~~

See accompanying Notes to Consolidated Financial Statements. 4 AMERICAN SOIL TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

~~Nine~~Three Months ~~Nine~~Three Months Ended Ended ~~June~~December 3031, ~~June~~December 3031, 2015 2014 ---------- ---------- Cash flows from operating activities: Net loss $ (~~420~~2,~~591~~269) $ ~~222~~(135,~~471~~560) Adjustments to reconcile net ~~income (~~loss) to net cash Depreciation and amortization -- -- Gain on ~~extinguishment~~estinquishment of ~~liabilities~~debt -- (~~635~~24,~~903~~036) ~~Depreciation and amortization~~ -- ~~10,436~~ Changes in operating assets and liabilities: Accounts receivable (34,~~043)~~446 ~~704~~-- Accounts payable (111,~~542~~633) ~~(34,778)~~375 Accrued ~~liabilities~~expenses ~~388~~16,~~614~~873 ~~396~~129,~~929~~595 ---------- ---------- Net cash used in operating activities (3616,~~562~~619) (405,~~141~~590) ---------- ---------- Cash flows from financing activities: Proceeds from related party notes 3714,000 405,000 ---------- ---------- Net cash provided by financing activities 3714,000 405,000 ---------- ---------- Net ~~decrease~~change in cash and cash equivalents ~~439~~(2,619) (~~141~~590) Cash and cash equivalents at beginning of period 34,~~157~~531 3,~~070~~157 ---------- ---------- Cash and cash equivalents at end of period $ 31,~~596~~912 $ 2,~~929~~567 ========== ========== Supplemental disclosure of cash flow information: Cash paid during the period for interest $ ~~827~~573 $ ~~1,003~~984 ========== ========== Cash paid during the period for income taxes $ -- $ -- ========== ==========

See accompanying Notes to Consolidated Financial Statement 5 AMERICAN SOIL TECHNOLOGIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2015 (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 Smart World Organics ("Smart World") and a patent to a slow release fertilizer. The Company also has exclusive license rights to the use of patented polymer application technique, as well as numerous patents on a unique machine designed to inject polymer and other liquid products into existing turf and some crops. 2. GOING CONCERN AND MANAGEMENT'S PLAN The Company has sustained significant losses and has an accumulated deficit of $29,617,000 and negative working capital of $8,335,260 as of December 31, 2015. 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 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 2015 as reported in the Company's Form 10-K have been omitted. The results of operations for the three month period ended December 31, 2015 and 2014 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 adjustments, necessary to present fairly the Company's financial position, results of operations and cash flows. These statements should be read in conjunction with the consolidated financial statements and related notes which are part of the Company's Annual Report on Form 10-K for the year ended September 30, 2015. 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. NET INCOME (LOSS) PER SHARE Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average common shares outstanding during the period. Diluted net income (loss) per share reflects the potential dilution to basic net income (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 6 period. Series A convertible preferred stock totaling 2,763,699 shares have been excluded in the calculation of diluted net income (loss) per share for the three months ended December31, 2015 and 2014 as the effect of potential common shares is antidilutive. NEW ACCOUNTING PRONOUNCEMENTS The Financial Accounting Standards Board issues Accounting Standards Updates ("ASUs") to amend the authoritative literature in Accounting Standards Codification ("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 As of December 31, 2015 and September 30, 2015, the Company's inventories were fully reserved. 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 initiate claims of any amounts they might be owed has now elapsed. Based on our determinations and findings, we eliminated $24,036 in creditor liabilities during the three months ended December 31, 2015 which were all previously included in accounts payable and accrued liabilities in the accompanying balance sheets. The Company will continue to conduct this analysis going forward and eliminate obligations when such obligations are no longer enforceable based on applicable law. 6. ACCRUED EXPENSES Accrued expenses consist of the following at: December 31, September 30, 2015 2015 ---------- ---------- Interest $ 385,025 $ 378,308 Interest to related parties 287,374 277,219 Compensation and related 3,391,657 3,396,308 ---------- ---------- $4,064,056 $4,051,835 ========== ========== 7. NOTES PAYABLES AND RELATED PARTY TRANSACTIONS RELATED PARTY TRANSACTIONS During the three months ended December 31, 2015, the Company's secretary, Ms. Visco loaned the Company an additional $14,000 for working capital. The previous note for $1,008,842 was amended to increase the principal due to $1,022,842. The principal is due in June 2016 and interest is payable monthly, at prime rate. The note is currently in default for non-payment of interest. Subsequent to quarter end, Ms. Visco loaned the Company an additional $2,500, see Note 10. 8. COMMON STOCK There were no stock issuances during the three months ended December 31, 2015 and 2014. 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 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 7 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. On February 21, 2011, we agreed to pay interest on the settlement amount at 4% per annum. A creditor of Smart World Organics had taken four Florida judgments against it as well as American Soil. On November 11, 2015 a judgment was domesticated and entered in California against the Company and Smart World Organics in the amount of $54,300. This amount had been carried as a debt of the Company. To the best knowledge of our management, there are no other significant legal proceedings pending against us. 10. SUBSEQUENT EVENTS On January 28, 2016 Ms. Visco loaned the Company an additional $2,500. The terms of the loan as similar to those outlined in Note 7. 8 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 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: Three Months Three Months Ended Ended December 31, December 31, 2015 2014 ------------ ------------ (Unaudited) (Unaudited) STATEMENT OF OPERATIONS DATA: Revenue $ 0 $ 0 Net loss (2,269) (135,560) Net loss per share basic and diluted $ (0.00) $ (0.00) December 31, September 30, 2015 2015 ------------ ------------ (Unaudited) BALANCE SHEET DATA: Current Assets $ 2,588 $ 9,653 Current liabilities 8,337,848 8,342,644 Accumulated deficit $(29,617,000) $(29,614,731) THREE MONTHS ENDED DECEMBER 31, 2015 COMPARED TO THREE MONTHS ENDED DECEMBER 31, 2014 REVENUES There were no revenues for the three months ended December 31, 2015 and 2014. Lack of funds limits our efforts in sales and marketing. COST OF SALES Cost of goods sold decreased to zero for the three months ended December 31, 2015 from $922, for the three months ended December 31, 2014. Costs of goods sold are primarily related to storage fees incurred to store our remaining inventory, which has been fully reserved as of September 30, 2014. 9 OPERATING EXPENSES Operating expenses decreased to $8,861 from $117,324 for the three-month period ended December 31, 2015 and 2014, respectively. This decrease in operating expenses was primarily a result of a decrease of approximately $110,000 as a result of discounting the accrual of payroll for the three months ended December 31, 2015. The Company determined that due to minimal operations, payroll will only be accrued when services are provided by remaining employees going forward. The current employees have significant amounts of accrued compensation that is unpaid. NET LOSS We experienced net loss from operations of $2,269 for the three months ended December 31, 2015 as compared to net loss of $135,560 for the three months ended December 31, 2014. The difference in the three months ended on December 31, 2015 was primarily a result the discontinuance of payroll. In addition, 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. There was a $24,036 gain recognized during the three months ended December 31, 2015. The Company will continue to analyze past due payables in future periods. LIQUIDITY AND CAPITAL RESOURCES Cash and cash equivalents totaled $1,912 and $4,531 at December 31, 2015 and September 30, 2015, respectively. Net cash used in operating activities was $16,619 for the period ended December 31, 2015 compared to $5,590 during the period ended December 31, 2014. Net cash provided by financing activities was $14,000 for the period ended December 31, 2015 compared to $5,000 for the comparable period ended December 31, 2014. We have historically relied upon one of our officers and significant shareholders to provide cash to meet short term operating cash requirements. During the three months ended December 31, 2015, the Company's secretary, Ms. Visco loaned the Company an additional $14,000 for working capital. The previous note for $1,008,842 was amended to increase the principal due to $1,022,842. Interest expense for the three months ended December 31, 2015 and 2014 was $17,444 and $17,314, respectively. We have a working capital deficit of $8,335,260 as of December 31, 2015 compared to working capital deficit of $8,332,991 as of September 30, 2015. As shown in the accompanying financial statements, we have incurred an accumulated deficit of $29,617,000 and a working capital deficit of approximately $8,335,260 as of December 31, 2015. 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, 2015. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Not applicable 10 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 management has evaluated, under the supervision and with the participation of our chief executive officer and chief financial officer ("Certifying Officers"), the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (the "Exchange Act"). Based on that evaluation, our Certifying Officers have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures are effective in ensuring that information required to be disclosed in our Exchange Act reports is (1) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and (2) accumulated and communicated to our management, including Certifying Officers, as appropriate to allow timely decisions regarding required disclosure. 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 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 March 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. A creditor of Smart World Organics had taken four Florida judgements against it as well as American Soil Technologies. On November 11, 2015 a judgment was domesticated and entered in California against the Company and Smart World Organics in the amount of $54,300. This amount has been carried as a debt of the Company. To the best knowledge of our management, there are no other legal proceedings pending against us. 11 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. ITEM 4. MINE SAFETY DISCLOSURES 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 SIGNATURES In accordance with the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, duly authorized. DATED: February 19, 2016 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) 12

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