<PAGE>   1

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                 FORM 10-QSB/A

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the quarterly period ended December 31, 2000

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the transition period from _______ to _______.

                         Commission File Number 0-28745

                         NATIONAL SCIENTIFIC CORPORATION


                             Texas                           86-0837077

            4455 East Camelback Road, E-160, Phoenix, AZ        85018

                                  602-954-1492

         Indicate by check mark 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 [ ]

There were 48,607,498 shares of Common Stock, par value $.01 per share, were
outstanding at February 13, 2001.

Transitional Small Business Disclosure Format (Check One):  Yes [ ] No [X]
<PAGE>   2
                         NATIONAL SCIENTIFIC CORPORATION

                                   FORM 10-QSB

                                      INDEX

Part I - Financial Information

         Item 1 - Financial Statements (unaudited)

           Balance Sheet - December 31, 2000

           Statements of Operations - Three Months ended December 31, 2000, 1999
           and 1998 and Cumulative from October 1, 1997 (Inception) through
           December 31, 2000

           Statements of Cash Flows - Three Months ended December 31, 2000, 1999
           and 1998 and Cumulative from October 1, 1997 (Inception) through
           December 31, 2000

           Statements of Changes in Shareholders' Equity - Fiscal Years ended
           September 30, 2000, 1999 and 1998 and three months ended December 31,
           2000

           Notes to Financial Statements

         Item 2 - Management's Discussion and Analysis of Financial Condition
         and Results of Operations

Part II - Other Information

         Item 2 - Changes in Securities and Use of Proceeds

         Item 5 - Other Information

         Item 6 - Exhibits and reports on Form 8-K

Signatures
<PAGE>   3
                         PART I - FINANCIAL INFORMATION

                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

                        Unaudited Condensed Balance Sheet
                                December 31, 2000

<TABLE>
<CAPTION>
                                                                        2000
                                                                    ------------
<S>                                                                 <C>
                                     ASSETS

Current assets:
     Cash and cash equivalents                                      $  2,952,867
     Loan to officer                                                     200,000
     Other assets                                                         65,219
                                                                    ------------
        Total current assets                                           3,218,086
                                                                    ------------
Property and equipment, net of accumulated depreciation at $6,878         47,244
                                                                    ------------
                                                                    $  3,265,330
                                                                    ============

                 LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

Current liabilities:
     Accounts payable and accrued expenses                          $     11,720
     Other accrued liabilities                                         1,000,000
                                                                    ------------
        Total current liabilities                                      1,011,720

Commitments, contingencies and subsequent events (see notes)

Shareholders' equity (deficit):
     Common stock, par value $.01; 80,000,000 shares authorized,
        48,607,498 shares issued and outstanding
        at December 31, 2000                                             486,075
     Additional paid-in-capital                                       20,287,453
     Common stock options exercisable                                    263,760
    Accumulated deficit                                              (18,783,678)
                                                                    ------------
                                                                       2,253,610
                                                                    ------------
                                                                    $  3,265,330
                                                                    ============
</TABLE>
<PAGE>   4
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

                  Unaudited Condensed Statements of Operations
               For the Quarters Ended December 31, 2000, 1999 and
      For the Period from October 1, 1997 (Inception of Development Stage)
                            Through December 31, 2000

<TABLE>
<CAPTION>
                                                                                        Cumulative
                                                                                        Development
                                                      2000               1999              Stage
                                                  ------------       ------------       ------------
<S>                                               <C>                <C>                <C>
Revenues                                          $         --       $         --       $         --
                                                  ------------       ------------       ------------
Costs and expenses
     Consulting fees, related party                    422,008          1,398,270          8,158,323
     Compensation and benefits                         203,231                 --            276,937
     Research and development                          186,435             78,027          2,071,716
     Stock compensation                              5,093,160             50,320          5,248,436
     Other                                             234,609             62,324            704,406
                                                  ------------       ------------       ------------
                                                     6,139,443          1,588,941         16,459,818
                                                  ------------       ------------       ------------
Net loss from operations                            (6,139,443)        (1,588,941)       (16,459,818)
                                                  ------------       ------------       ------------
Other income (expense)
     Interest and other income                          42,744              4,074            115,691
     Interest expense                                       --             (2,750)           (16,316)
     Loss on disposal of assets                             --                 --            (28,555)
                                                  ------------       ------------       ------------
                                                        42,744              1,324             70,820
                                                  ------------       ------------       ------------
Net loss before income tax benefit                  (6,096,699)        (1,587,617)       (16,388,998)
Provision for income taxes (benefit)                        --                 --                 --
                                                  ------------       ------------       ------------
Net loss                                          $ (6,096,699)      $ (1,587,617)      $(16,388,998)
                                                  ============       ============       ============
Net loss per common share, basic and diluted      $      (0.13)      $      (0.04)
                                                  ============       ============
</TABLE>
<PAGE>   5
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

                  Unaudited Condensed Statements of Cash Flows
             For the Quarters Ended December 31, 2000 and 1999, and
      For the Period from October 1, 1997 (Inception of Development Stage)
                            Through December 31, 2000

<TABLE>
<CAPTION>
                                                                                                                Cumulative
                                                                                                                Development
                                                                              2000               1999               Stage
                                                                          ------------       ------------       ------------
<S>                                                                       <C>                <C>                <C>
Cash flows from operating activities:
     Net loss                                                             $ (6,096,699)      $ (1,587,617)      $(16,388,998)
     Adjustments to reconcile net loss to net
        cash used in operating activities:
        Depreciation                                                             1,746                334             11,765
        Loss on disposal of assets                                                  --                 --             28,555
        Stock and options issued for services                                2,124,180          1,468,090         12,683,427
        Amortization of deferred stock compensation                          3,062,500                 --          1,000,000
        Decrease (increase) in receivables                                          --                 --             30,000
        Decrease (increase) in other assets                                     40,337                 --            (54,648)
        Increase (decrease) in accounts payable and accrued expenses           (14,234)            (4,371)           (10,859)
        Increase (decrease) in accrued interest                                     --              2,750                 --
                                                                          ------------       ------------       ------------
            Net cash used in operating activities                             (882,170)          (120,814)        (2,700,758)
                                                                          ------------       ------------       ------------
Cash flows from investing activities:
     Acquisition of property and equipment                                     (41,593)                              (47,442)
     Proceeds from the sale of furniture and equipment                              --                 --              4,660
     Loan to officer                                                                --                 --           (200,000)
                                                                          ------------       ------------       ------------
                                                                               (41,593)                --           (242,782)
Cash flows from financing activities:                                     ------------       ------------       ------------
     Repayment of debt                                                              --                 --           (110,000)
     Repayment of shareholder loans                                                 --                 --            (10,000)
     Repayment of capital lease obligations                                         --                 --             (1,819)
     Proceeds from the issuance of common stock                              1,291,730            761,150          5,532,108
     Proceeds from the issuance of preferred stock                                  --                 --            482,500
                                                                          ------------       ------------       ------------
           Net cash provided by financing activities                         1,291,730            761,150          5,892,789
                                                                          ------------       ------------       ------------
Net increase in cash and cash equivalents                                      367,967            640,336          2,949,249
Cash and cash equivalents, beginning of year                                 2,584,900             62,185              3,618
                                                                          ------------       ------------       ------------
Cash and cash equivalents, end of the quarter                             $  2,952,867       $    702,521       $  2,952,867
                                                                          ============       ============       ============
</TABLE>
<PAGE>   6
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

                  Unaudited Condensed Statements of Cash Flows
             For the Quarters Ended December 31, 2000 and 1999, and
      For the Period from October 1, 1997 (Inception of Development Stage)
                            Through December 31, 2000


Supplementary Disclosure of Cash Flow Information
<TABLE>
<CAPTION>
                                                                       Cumulative
                                                                       Development
                                                    2000       1999       Stage
                                                    -----      -----   -----------

<S>                                                 <C>        <C>     <C>
Cash paid during the year for interest              $  --      $  --      $2,597
                                                    =====      =====       =====
Cash paid during the year for income taxes          $  --      $  --      $   --
                                                    =====      =====       =====
</TABLE>

Summary of Non-Cash Investing and Financing Activities

During 1998, the Company sold equipment for $4,660 in cash, with the purchaser
assuming $9,252 in lease obligations.

During the year-ended September 30, 1999, the Company issued 451,440 shares of
     restricted common stock to a Director in exchange for 320,000 shares of
     unrestricted common stock.

During the quarter-ended December 31, 1999, the Company issued 1,128,600 shares
      of restricted common stock to a Director's family member in exchange for
      580,000 shares of unrestricted common stock.
<PAGE>   7
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

        Unaudited Statements of Changes in Shareholders' Equity (Deficit)
           For the Years Ended September 30, 2000, 1999 and 1998, and
                     For the Quarter Ended December 31, 2000


<TABLE>
<CAPTION>
                                            Common Stock           Preferred Stock
                                      -----------------------   -----------------------   Additional
                                      Number of        Par      Number of       Par        Paid-In     Accumulated
                                       Shares         Value      Shares        Value       Capital       Deficit
                                      ----------   ----------   ----------   ----------   ----------   -----------

<S>                                   <C>          <C>          <C>          <C>          <C>          <C>
Balance September 30, 1997            17,847,292   $  178,473           --   $       --    2,160,780    (2,394,680)
Stock issued for services              3,487,557       34,875           --           --      335,473            --
Private placement of preferred stock          --           --       49,500        4,950      242,550            --
Exercise of warrants and options         547,000        5,470           --           --      100,888            --
Conversion of preferred to
    common stock                       3,450,000       34,500      (34,500)      (3,450)     (31,050)           --
Contributed capital                           --           --           --           --       14,850            --
Net loss                                      --           --           --           --           --      (772,545)
                                      ----------   ----------   ----------   ----------   ----------    ----------
Balance, September 30, 1998           25,331,849   $  253,318       15,000   $    1,500    2,823,491    (3,167,225)
                                      ----------   ----------   ----------   ----------   ----------    ----------
</TABLE>



<TABLE>
<CAPTION>
                                           Total
                                          --------
<S>                                       <C>
Balance September 30, 1997                 (55,427)
Stock issued for services                  370,348
Private placement of preferred stock       247,500
Exercise of warrants and options           106,358
Conversion of preferred to
    common stock                                --
Contributed capital                         14,850
Net loss                                  (772,545)
                                          --------
Balance, September 30, 1998                (88,916)
                                          --------
</TABLE>
<PAGE>   8
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

     Statements of Changes in Shareholders' Equity (Deficit), continued
          For the Years Ended September 30, 2000, 1999 and 1998, and
                     For the Quarter Ended December 31, 2000

<TABLE>
<CAPTION>
                                                    Common Stock         Preferred Stock
                                               ---------------------   -------------------    Additional
                                                Number of      Par      Number of     Par      Paid-In     Accumulated
                                                 Shares       Value      Shares      Value     Capital       Deficit
                                               ----------    -------   ----------   ------    ----------   -----------

<S>                                            <C>          <C>        <C>          <C>       <C>          <C>
Balance, September 30, 1998                    25,331,849   $253,318      15,000    $1,500     2,823,491    (3,167,225)
Stock issued for services                       3,165,000     31,650          --        --       561,349            --
Preferred stock offering                               --         --      47,000     4,700       230,300            --
Exercise of warrants and options                  496,000      4,960          --        --        27,490            --
Private placement of common stock                 400,000      4,000          --        --        96,000            --
Conversion of preferred to
    common stock                                6,200,000     62,000     (62,000)   (6,200)      (55,800)           --
Common stock issued to collateralize loan         500,000      5,000          --        --            --            --
Stock converted by director's family member       451,440      4,515          --        --        (4,515)           --
Net loss                                               --         --          --        --            --      (944,455)
                                               ----------    -------     -------    ------    ----------    ----------
Balance, September 30, 1999                    36,544,289   $365,443          --        --     3,678,315    (4,111,680)
                                               ----------    -------     -------    ------    ----------    ----------
</TABLE>


<TABLE>
<CAPTION>
                                                     Total
                                                   --------

<S>                                                <C>
Balance, September 30, 1998                         (88,916)
Stock issued for services                           592,999
Preferred stock offering                            235,000
Exercise of warrants and options                     32,450
Private placement of common stock                   100,000
Conversion of preferred to
    common stock                                         --
Common stock issued to collateralize loan             5,000
Stock converted by director's family member              --
Net loss                                           (944,455)
                                                   --------
Balance, September 30, 1999                         (67,922)
                                                   --------
</TABLE>
<PAGE>   9
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

       Statements of Changes in Shareholders' Equity (Deficit), continued
           For the Years Ended September 30, 2000, 1999 and 1998, and
                    For the Quarter Ended December 31, 2000


<TABLE>
<CAPTION>
                                                  Common Stock            Preferred Stock
                                              ---------------------   ----------------------  Additional
                                              Number of       Par       Number of     Par       Paid-In    Accumulated
                                               Shares        Value       Shares       Value     Capital      Deficit
                                              ----------   --------   -----------  ---------  -----------  -----------

<S>                                           <C>          <C>        <C>          <C>        <C>          <C>
Balance, September 30, 1999                   36,544,289   $365,443            --         --    3,678,315   (4,111,680)
Stock issued for services                      2,817,629     28,176            --         --   11,268,044           --
Exercise of warrants and options               3,440,250     34,403            --         --    3,151,997           --
Private placement of common stock              3,765,000     37,650            --         --      712,350           --
Stock converted by director's family member    1,128,600     11,286            --         --      (11,286)           --
Common stock to collateralize loan - retired    (500,000)    (5,000)           --         --           --           --
Deferred stock compensation                           --         --            --         --   (3,712,500)          --
Net loss                                              --         --            --         --           --   (8,575,299)
                                              ----------   --------     ---------  ---------  -----------   ----------
Balance, September 30, 2000                   47,195,768   $471,958            --         --   15,086,920  (12,686,979)
                                              ==========   ========     =========  =========  ===========   ==========
</TABLE>


<TABLE>
<CAPTION>
                                                   Total
                                                 ----------

<S>                                              <C>
Balance, September 30, 1999                         (67,922)
Stock issued for services                        11,296,220
Exercise of warrants and options                  3,186,400
Private placement of common stock                   750,000
Stock converted by director's family member              --
Common stock to collateralize loan - retired         (5,000)
Deferred stock compensation                      (3,712,500)
Net loss                                         (8,575,299)
                                                 ----------
Balance, September 30, 2000                       2,871,899
                                                 ==========
</TABLE>
<PAGE>   10
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

       Statements of Changes in Shareholders' Equity (Deficit), continued
           For the Years Ended September 30, 2000, 1999 and 1998, and
                    For the Quarter Ended December 31, 2000


<TABLE>
<CAPTION>
                                          Common Stock           Preferred Stock
                                      ---------------------    --------------------    Additional
                                      Number of       Par       Number of     Par       Paid-In     Accumulated
                                        Shares       Value       Shares      Value      Capital       Deficit
                                      ----------   --------    ----------  --------    ----------   -----------

<S>                                   <C>          <C>         <C>         <C>         <C>          <C>
Balance, September 30, 2000           47,195,768   $471,958            --        --    15,086,920   (12,686,979)
Stock issued for services                120,000      1,200            --        --       209,220            --
Exercise of warrants and options       1,291,730     12,917            --        --     1,278,813            --
Amortization of stock compensation            --         --            --        --     3,712,500            --
Common stock options exercisable              --         --            --        --       263,760            --
Net loss                                      --         --            --        --            --    (6,096,699)
                                      ----------   --------       -------  --------    ----------    ----------
Balance, December 31, 2000            48,607,498   $486,075            --        --    20,551,213   (18,783,678)
                                      ==========   ========       =======  ========    ==========    ==========
</TABLE>


<TABLE>
<CAPTION>
                                           Total
                                         ----------

<S>                                      <C>
Balance, September 30, 2000               2,871,899
Stock issued for services                   210,420
Exercise of warrants and options          1,291,730
Amortization of stock compensation        3,712,500
Common stock options exercisable            263,760
Net loss                                 (6,096,699)
                                         ----------
Balance, December 31, 2000                2,253,610
                                         ==========
</TABLE>
<PAGE>   11
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

                     Notes to Unaudited Financial Statements
                    Quarter Ended December 31, 2000 and 1999


1.   Basis of Presentation

     The accompanying financial statements have been prepared by the Company,
         without audit, and reflect all adjustments that are, in the opinion of
         management, necessary for a fair statement of the results for the
         interim periods. The statements have been prepared in accordance with
         generally accepted accounting principles for interim financial
         reporting and Securities and Exchange Commission regulations. Certain
         information and footnote disclosures normally included in financial
         statements prepared in accordance with generally accepted accounting
         principles have been condensed or omitted pursuant to such rules and
         regulations. In the opinion of management, the financial statements
         reflect all adjustments (of a normal and recurring nature) which are
         necessary for a fair presentation of the financial position, results of
         operations and cash flows for the interim periods. The results of
         operations for the three months ended December 31, 2000 are not
         necessarily indicative of the results to be expected for the entire
         fiscal year.

     The financial statements included in this 10-Q have been amended to reflect
         a change in the estimated value of the restricted shares issued as
         compensation for services. The Company has reduced the discount from
         the open market price from 50% to 10% based on SEC Staff comments to a
         filing made in August 2001. Management believes the discount, which
         reflects the lack of marketability of the restricted stock, plus the
         lack of market volume to absorb a large block of stock to be a
         reasonable estimate of value.

     These financial statements 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 fiscal year ended September 30, 2000.

2.   Employment Agreement

     The employment agreement with the President is still under negotiation. The
         shares of restricted common stock granted to the President are
         currently being restructured, to be exchanged for options to purchase
         common stock. The employment agreement currently being negotiated
         contemplates granting options to purchase approximately 2,100,000 and
         666,700 shares of common stock at exercise prices proposed to be $.46
         per share and $.29 per share, or 25% of the market value of common
         stock on December 1, 2000 and January 1, 2001, respectively. At the
         date of filing this Form 10-QSB, the contract had not yet been
         finalized.

     The Company is accruing additional compensation of $1,000,000 to reflect
         the probability that the final option agreement will be greater in
         value than the restricted common shares to be exchanged.

3.   Issuance of Common Stock

     During the three months ended December 31, 2000, the Company received
         $1,291,730 and issued 1,291,730 shares of restricted common stock in
         connection with the exercise of its $1.00 common stock warrants. The
         Company also issued 100,000 shares of restricted common stock valued at
         $165,600 to consultants and principals as compensation for services.
         The Company issued 20,000 shares of restricted common stock valued at
         $44,820 to consultants as compensation for services. This restricted
         stock was valued at 90% of the market price of the stock on the dates
         granted and earned.
<PAGE>   12
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

                     Notes to Unaudited Financial Statements
                    Quarter Ended December 31, 2000 and 1999


3.   Issuance of Common Stock (continued)

     During the quarter ended December 31, 1999, the Company received $750,000
         from a private placement of common stock. In conjunction with the
         offering, the Company issued 600,000 shares of restricted stock valued
         at $1,062,720 to a principal and a consultant of the Company. The
         Company also issued 500,000 shares of restricted common stock to
         consultants as compensation for services.

4.   Stock Options

     The Company from time to time issues stock options for the purchase of
         restricted stock to directors, officers, employees and consultants. The
         Company adopted a qualified stock option plan for its executives and
         employees in December 2000.

     The Company adopted APB Opinion 25 and related interpretations in
         accounting for the plan. Accordingly, compensation expense is equal to
         the difference between the exercise price of the options granted and
         the fair value of the common stock at the date of grant. Compensation
         of $263,760 has been recognized for the quarter ended December 31,
         2000. Under the terms of the Company's stock options granted to certain
         directors, officers, employees and consultants, the Board of Directors,
         at its sole discretion, will determine when certain options granted
         shall be fully vested and exercisable. At December 31, 2000, all
         outstanding stock options had been deemed vested, and were fully
         exercisable.

     In  accordance with APB Opinion 25, the fair value of option grants is
         estimated on the date of grant using the Black-Scholes option-pricing
         model for proforma footnote purposes with the following assumptions
         used for grants in all years; dividend yield of 0%, risk-free interest
         rate of 6%, and expected option life of 5 years. Expected volatility
         was assumed to be 100% as of the date of issue.


<TABLE>
<CAPTION>
                                                                  Weighted
                                                    Number         Average
                                                      Of          Exercise
                                                    Shares          Price
                                                   ---------      --------

<S>                                                <C>            <C>
     Options Outstanding, September 30, 2000              --
         Granted                                   1,207,667       $  1.63
         Exercised                                        --            --
                                                   ---------
     Options Outstanding, December 31, 2000        1,207,667       $  1.63
                                                   =========
</TABLE>


     Had the Company fully adopted SFAS 123, the first quarter loss from
         operations would have been $(7,974,606) and basic loss per share would
         have been $(0.17).
<PAGE>   13
                         NATIONAL SCIENTIFIC CORPORATION
                          (A Development Stage Company)

                     Notes to Unaudited Financial Statements
                    Quarter Ended December 31, 2000 and 1999

5.   Loan to Officer

     During the quarter ended December 31, 2000 the Company renewed a loan with
         a Director and Officer for $200,000, bearing interest at 10% per annum
         and due on December 1, 2001.

6.   Net Loss Per Share

     Net loss per share is computed by dividing the loss attributable to common
         shareholders by the weighted average number of shares outstanding
         during the period, which was assumed to be 47,661,601 and 40,532,808
         for the three months ended December 31, 2000 and 1999, respectively.
         Stock options and warrants are considered anti-dilutive and were not
         considered in the calculation.

7.   Subsequent Event

     On  January 19, 2001, the Company loaned $100,000 to an entity at 12%
         interest. The Chairman of the Board of the entity is also a director of
         the Company. The loan is to be repaid in two $50,000 installments,
         which are due March 1 and April 1, 2001.

Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations

SAFE HARBOR STATEMENT

Certain statements in this Form 10-QSB, including information stated under Item
2 Management's Discussion and Analysis of Financial Condition and Results of
Operations constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995 (the Act). We desire to make
available to ourselves certain "safe harbor" provisions of the Act and we are
including this special note to enable us to do so.

Forward-looking statements in the Form 10-QSB or those included in other
publicly available documents filed with the Securities and Exchange Commission,
reports to our stockholders and other publicly available statements issued or
released by us involve known and unknown risks, uncertainties and other factors
which could cause our actual results, performance (financial or operating) or
achievements to differ from the future results, performance (financial or
operating) or achievements expressed or implied by such forward-looking
statements. Such future results are based upon management's best estimates based
upon current conditions and the most recent results of operations.

Three Months Ended December 31, 2000 Compared to Three Months Ended December 31,
1999

We are a development stage company and, therefore, have no revenues to report
for the periods indicated above.

We believe that our cash position of approximately $3.0 million as of December
31, 2000, to be sufficient to continue operations for the next twelve months.
Such future requirements are based upon management's best estimates based upon
current conditions and the most recent results of operations.

In the next twelve months, we expect to continue to increase our research and
development expenditures with additional staffing. The purpose of these
additional expenditures is to bring our existing products closer to the point of
market readiness by producing working prototypes along with design and process
specifications. Additionally, these expenditures will be used for continued
research into RF technologies that are anticipated to provide wireless products
into next generation electronic devices. There can be no assurance that we will
be successful in completing these tasks in the time period estimated.

Operating expenses for the three months ended December 31, 2000 of approximately
$6.1 million are up from the similar period ended December 31, 1999, which were
approximately $1.6 million. This increase, over the similar period last year,
was primarily due to the increase in stock compensation of approximately $3.7
million in lieu of cash to the Company's President. The employment agreement
with the President is still under negotiation. The shares of restricted common
stock granted to the President are currently being restructured, to be exchanged
for options to purchase common stock. The employment agreement currently being
negotiated contemplates
<PAGE>   14
granting options to purchase approximately 2,100,000 and 666,700 shares of
restricted common shares of common stock at exercise prices proposed to be $.46
per share and $.29 per share, or 25% of the market value of common stock on
December 1, 2000 and January 1, 2001, respectively.

Compensation and benefits have increased by approximately $203,000 due to the
addition of the Chief Operating and Financial Officers, the Global Director of
Marketing and the Director of Research in our San Jose research facility. In
addition, research and development costs increased approximately $108,000.
Research and development costs increased due primarily to our opening our San
Jose, California research facility and hiring an additional research scientist.

Liquidity and Capital Resources

For the three months ended December 31, 2000, additional capital of
approximately $1.3 million was received as a result of the exercise of
approximately 1.3 million of the warrants to acquire a total of 9,650,000 shares
of restricted common stock that were issued in conjunction with our private
offering of March 15, 1998, at an exercise price of $1.00 per share. The
remaining unexercised warrants that were issued in connection with this offering
expired on December 31, 2000.

Warrants to acquire 4,250,000 shares of restricted common stock, which expire on
December 31, 2001, were issued in conjunction with our private offering of
August 1, 1999, at an exercise price of $1.50 per share. Prior to the fiscal
quarter ended December 31, 2000, 120,000 of these warrants were exercised,
raising $180,000 in equity and cash. We expect that more of these warrants will
be exercised prior to their expiration; however, there can be no assurance that
any more of these warrants will be exercised.

Cash used in operations was approximately $882,000 for the three months ended
December 31, 2000 compared with approximately $121,000 for the three month
period ended December 31, 1999. The increase in cash used in operations resulted
significantly from the employment several new employees, including the Chief
Operating and Financial Officers, both of whom were hired in October 2000, the
Global Director of Marketing who was hired on December 1, 2000 and a research
scientist in San Jose, California who was hired on November 1, 2000. In
addition, the President of NSC, as an independent consultant, was engaged on
September 1, 2000. The fiscal quarter ended December 31, 2000 represents the
first entire quarter that includes regular contractor payments to the President.


                           PART II - OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds

On December 31, 1999, we completed our private offering of August 1, 1999. A
total of $850,000 was raised during the offering. We sold 4,165,000 shares of
restricted common stock
<PAGE>   15
at an average price of $.20 per share for the entire offering. Of these totals,
$750,000 was raised and 3,765,000 shares were sold during the quarter ended
December 31, 1999.

As part of this offering, we also issued 4,250,000 warrants to purchase one
restricted share of common stock at a price of $1.50 for each warrant. These
warrants are immediately exercisable and they all expire on December 31, 2001.
One hundred twenty thousand (120,000) of these warrants have been exercised as
of the date of this filing. The shares were sold in reliance on the exemption
provided by Sections 4 (2) and 4 (6) of the Securities Act of 1933 and Rule 506
of Regulation D.

During the three months ended December 31, 2000, approximately 1.3 million
warrants were exercised at $1.00 each. These represent a portion of the
9,650,000 warrants issued in conjunction with our Private Offering of March 15,
1998. The remaining and unexercised warrants issued during this Private Offering
expired on December 31, 2000. The shares were sold in reliance on the exemption
provided by Sections 4 (2) and 4 (6) of the Securities Act of 1933 and Rule 506
of Regulation D.

In addition, during the three months ended December 31, 2000, 100,000 restricted
shares of common stock were issued to the Chief Operating Officer, in accordance
with his employment agreement, and 15,000 shares were granted to a consultant
for services rendered.

On December 1, 2000, the Board of Directors instituted a Stock Option Plan (2000
Plan). The Board is of the opinion that it is in the best interest of NSC to
reserve not less than 7,000,000 Common Shares to provide adequate Common Shares
for the issuance to qualified individuals under the 2000 Plan to encourage them
to remain in the service of NSC and to promote its business and growth strategy.
The full text of the Amended and Restated 2000 Stock Option Plan is set forth as
Exhibit 10.1 to this Form 10-QSB.

Item 5.  Other Information

Subsequent to our latest filings with the SEC, we have learned that the U.S.
Patent and Trademark Office issued patent number 6,171,920 for our Hetrojunction
Bipolar Transistor. In June 1999, we had received a patent on the novel design
and architecture for the product. This most recent patent relates to the
intellectual property required to manufacture the transistor. Additionally, on
January 2, 2001, the U.S. Patent and Trademark Office granted patent number
6,169,467 for our Mode Dielectric Resonator. The Mode Dielectric Resonator is
unique in its design allowing for a significant reduction in size and an
increase in the Quality factor.

In January 2001, we executed several distribution contracts with Korean
technology manufacturers that we believe will allow the Company to expand its
business infrastructure and start the transformation from a pure research and
development company to a more complete and operational full-line business. We
currently anticipate that the contracts will produce in excess of $5.0 million
in revenue for the current fiscal year.
<PAGE>   16
During the three months ended December 31, 2000, the Company rounded out is
Board of Directors with the addition of Michael A. Grollman, Sam H. Carr, both
officers of the Company, as well as Richard C. Kim and Charles E. Martin, who
both serve as outside directors. In addition to the Board of Directors, we have
begun a technical advisory board, currently consisting of two prominent and
respected scientists, which are called upon to advise the Company on its
technology strategies and functionality.

Item 6.  Exhibits and reports on Form 8-K

(a) Exhibits
         Exhibit 10.1 Amended and Restated 2000 Stock Option Plan
         Exhibit 10.2 Master Purchase & License Contract - Sun Il Computec
         Exhibit 10.3 Master Purchase & License Contract - Maroo Electrotech
            Co. Ltd.
         Exhibit 10.4 Master Purchase & License Contract - Ozaki Korea Co., Ltd.

(b) Reports on Form 8-K - No reports on Form 8-K were filed during the quarter.
<PAGE>   17
                                   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.


                                NATIONAL SCIENTIFIC CORPORATION

February 13, 2001                  /s/ L.L. Ross
     DATE                          ---------------
                                    L.L Ross
                                   Chairman of the Board, President & C.E.O.

                                   /s/ Sam H. Carr
                                   ---------------
                                   Sam H. Carr
                                   Corporate Secretary
<PAGE>   18
                                INDEX TO EXHIBITS


Exhibit 10.1 Amended and Restated 2000 Stock Option Plan
Exhibit 10.2 Master Purchase & License Contract - Sun Il Computec
Exhibit 10.3 Master Purchase & License Contract - Maroo Electrotech Co. Ltd.
Exhibit 10.4 Master Purchase & License Contract - Ozaki Korea Co., Ltd.