UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB


[x]      QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002

[ ]      TRANSITION REPORT UNDER SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE
         ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO

                        Commission file number 000-25663
                                               ----------

                            ULTRASTRIP SYSTEMS, INC.
        (Exact name of small business issuer as specified in its charter)

                   Florida                                65-0841549
       (State or other jurisdiction of                 (I.R.S. employer
       incorporation or organization)                 identification no.)

                            3515 S.E. Lionel Terrace
                              Stuart, Florida 34997
                    (Address of principal executive offices)

                                 (772) 287-4846
                (Issuer's telephone number, including area code)


                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 42,542,394 shares of common stock
were outstanding as of September 30, 2002.

Transitional Small Business Disclosure Format (check one):  Yes [ ]   No  [x]


Note: The information contained in this Form 10-QSB relates only to the covered
period. The Company has not provided supplemental or revised information after
the period covered by this report, but instead has disclosed such information in
its quarterly reports on Form 10-QSB and annual reports on Form 10-KSB, as
appropriate for periods subsequent to September 30, 2002.


<PAGE>
                            ULTRASTRIP SYSTEMS, INC.

                                   FORM 10-QSB


                                TABLE OF CONTENTS
                                -----------------


                                                                            Page
                                                                            ----
PART I. FINANCIAL INFORMATION

        Item 1. Financial Statements (unaudited)
                   Condensed Balance Sheet.................................. 1
                   Condensed Statements of Operations....................... 2
                   Condensed Statements of Cash Flows......................  3
                   Notes to Condensed Financial Statements.................  4
        Item 2. Management's Discussion and Analysis of Financial Condition
                and Results of Operations and Plan of Operation............. 10
        Item 3. Controls and Procedures..................................... 17

PART II. OTHER
INFORMATION

        Item 1. Legal Proceedings........................................... 17
        Item 2. Changes in Securities....................................... 18
        Item 3. Defaults Upon Senior Securities............................. 18
        Item 4. Submission of Matters to a Vote of Security Holders......... 18
        Item 5. Other Information........................................... 18
        Item 6. Exhibits and Reports on Form 8-K............................ 19

                Signatures.................................................. 23

                Certifications.............................................. 24

                                       ii
<PAGE>
                         PART I - FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS.

                            ULTRASTRIP SYSTEMS, INC.
                        UNAUDITED CONDENSED BALANCE SHEET


================================================================================
September 30,                                                          2002
--------------------------------------------------------------------------------

CURRENT ASSETS
   Cash and cash equivalents                                      $    116,340
   Accounts receivable                                                 196,571
   Prepaid expenses and other                                           29,264
--------------------------------------------------------------------------------

TOTAL CURRENT ASSETS                                                   342,175

PROPERTY AND EQUIPMENT, NET                                          2,104,419

PATENTS, NET                                                            96,806
--------------------------------------------------------------------------------

                                                                  $  2,543,400
================================================================================

LIABILITIES, REDEEMABLE CONVERTIBLE CUMULATIVE PREFERRED STOCK
AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
   Accounts payable and accrued expenses                          $  1,876,511
   Accounts payable - related parties                                  494,522
   Notes payable to related parties                                  2,269,854
   Notes payable - current portion                                     199,509
--------------------------------------------------------------------------------

TOTAL CURRENT LIABILITIES                                            4,840,396

NOTES PAYABLE, LESS CURRENT PORTION                                     82,878
--------------------------------------------------------------------------------


TOTAL LIABILITIES                                                    4,923,274

REDEEMABLE CONVERTIBLE CUMULATIVE PREFERRED STOCK SERIES A
   28 shares outstanding, $25,000 per share redemption amount
   plus dividends in arrears                                         1,177,598

REDEEMABLE CONVERTIBLE CUMULATIVE PREFERRED STOCK SERIES B
   1,054 shares outstanding, $2,500 per share redemption amount
   plus dividends in arrears                                         3,179,900

COMMITMENTS AND CONTINGENCIES (Note 9)

STOCKHOLDERS' DEFICIT

COMMON STOCK, $0.01 par value; 100,000,000 shares authorized;
  42,542,394 shares issued and outstanding                             425,424
ADDITIONAL PAID-IN CAPITAL                                          18,088,307
DEFERRED COMPENSATION                                                  (48,508)
ACCUMULATED DEFICIT                                                (25,202,595)
--------------------------------------------------------------------------------

TOTAL STOCKHOLDERS' DEFICIT                                         (6,737,372)
--------------------------------------------------------------------------------

                                                                  $  2,543,400
================================================================================

                                       1
<PAGE>
                           ULTRASTRIP SYSTEMS, INC.

                  UNAUDITED CONDENSED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                         FOR THE THREE MONTHS ENDED     FOR THE NINE MONTHS ENDED
                                                                SEPTEMBER 30,                  SEPTEMBER 30,
                                                            2002            2001            2002           2001
-------------------------------------------------------------------------------------------------------------------
<S>                                                    <C>             <C>             <C>             <C>
REVENUES:
     Equipment sales                                   $  2,346,508    $         --    $  2,419,093    $         --
     Hydrojetting contracts                                  94,721          77,724         344,106         737,524
-------------------------------------------------------------------------------------------------------------------

TOTAL REVENUES                                            2,441,229          77,724       2,763,199         737,524

OPERATING EXPENSES:
     Cost of equipment sales                              1,242,825         210,933       1,282,226         210,933
     Cost of hydrojetting contracts                          91,278         131,603         304,873         695,127
     Selling, general and administrative, excluding
         non-cash compensation (benefit) expense            931,651       1,298,724       3,210,399       4,356,885
     Non-cash compensation expense (benefit)                  5,510       4,512,790      (1,261,732)      8,737,160
-------------------------------------------------------------------------------------------------------------------

Total operating expenses                                  2,271,264       6,154,050       3,535,766      14,000,105
-------------------------------------------------------------------------------------------------------------------

Income (loss) from operations                               169,965      (6,076,326)       (772,567)    (13,262,581)

Other (income) expense:
     Other income                                              (473)             --          (6,493)             --
     Interest expense                                       113,580           5,161         239,856          20,233
-------------------------------------------------------------------------------------------------------------------

Net income (loss)                                            56,858      (6,081,487)     (1,005,930)    (13,282,814)

Preferred stock dividends                                   (92,125)        (97,875)       (279,222)       (300,000)
-------------------------------------------------------------------------------------------------------------------

Net income (loss) applicable to common stock           $    (35,267)   $ (6,179,362)   $ (1,285,152)   $(13,582,814)
===================================================================================================================

Net income (loss) per common share (basic and
   diluted)                                            $      (0.00)   $     (0.15)    $      (0.03)   $      (0.33)
===================================================================================================================

Weighted average number of common shares outstanding     42,415,220      42,154,009      42,443,754      41,438,544
===================================================================================================================
</TABLE>

                                       2
<PAGE>
                            ULTRASTRIP SYSTEMS, INC.
                  UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
For the nine months ended September 30                         2002           2001
---------------------------------------------------------------------------------------
<S>                                                        <C>             <C>
OPERATING ACTIVITIES:
   Net loss                                                $ (1,005,930)   $(13,282,814)

   Adjustments to reconcile net loss to
     net cash used in operating activities:
       Depreciation and amortization                            522,514         552,649
       Accretion of discount on notes payable                   171,852              --
       Common stock issued for services                              --       2,320,000
       Issuance of equity instruments for services                   --         173,160
       Non-cash compensation (benefit) expense               (1,278,800)      6,244,000
       Deferred compensation expense                             17,068              --
       Provision for impairment of equipment                         --         210,933
   Change in operating assets and liabilities:
         Accounts receivable                                   (188,772)       (908,624)
         Inventories                                            456,678              --
         Prepaid expenses and other                              79,276         (64,750)
         Accounts payable and accrued expenses                  (13,299)      1,241,093
         Accounts payable - related parties                    (236,705)             --
         Deferred revenue                                      (125,000)         78,365
---------------------------------------------------------------------------------------

Net cash used in operating activities                        (1,601,118)     (3,435,988)
---------------------------------------------------------------------------------------

INVESTING ACTIVITIES:
   Patent expenditures                                           (3,324)        (17,601)
   Purchase of property and equipment                           (37,904)     (1,122,361)
   Repayment of note receivable from officer                     50,000              --
---------------------------------------------------------------------------------------

Net cash provided by (used in) investing activities               8,772      (1,139,962)
---------------------------------------------------------------------------------------

FINANCING ACTIVITIES:
   Proceeds from issuance of long-term debt and warrants        200,000          34,913
   Repayment of long-term debt                                   (8,748)        (11,544)
   Proceeds from issuance of long-term debt and
     warrants to related parties                              1,547,500         454,360
   Repayment of long-term debt to related parties            (1,355,000)       (102,901)
   Proceeds from issuance of preferred stock                         --         200,000
   Proceeds from issuance of common stock                       281,000       4,007,158
   Proceeds from issuance of warrants                           500,000              --
---------------------------------------------------------------------------------------

Net cash provided by financing activities                     1,164,752       4,581,986
---------------------------------------------------------------------------------------

Net increase (decrease) in cash and cash equivalents           (427,594)          6,036

Cash and cash equivalents, beginning of year                    543,934         300,304
---------------------------------------------------------------------------------------

Cash and cash equivalents, end of period                   $    116,340    $    306,340
=======================================================================================
</TABLE>

                             See Note 10 for supplemental cash flow disclosures.

                                       3
<PAGE>
                            ULTRASTRIP SYSTEMS, INC.
               NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

1.  SUMMARY OF SIGNIFICANT
    ACCOUNTING POLICIES

    BASIS OF                The accompanying  unaudited condensed financial
    PRESENTATION            statements have been prepared in accordance with
                            accounting principles generally accepted in the
                            United States of America for interim financial
                            information and with Item 310 of Regulation S-B.
                            Accordingly, they 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. The
                            financial statements reflect all normal recurring
                            adjustments which, in the opinion of management, are
                            considered necessary for a fair presentation of the
                            results for the periods shown. The results of
                            operations for the periods presented are not
                            necessarily indicative of the results expected for
                            the full fiscal year or for any future period. The
                            information included in these unaudited condensed
                            financial statements should be read in conjunction
                            with Management's Discussion and Analysis of
                            Financial Condition and Results of Operations
                            contained in this report and the audited financial
                            statements and accompanying notes included in the
                            UltraStrip Systems, Inc. (the "Company") Annual
                            Report on Form 10-KSB for the fiscal year ended
                            December 31, 2001.

                            Certain amounts in prior periods have been
                            reclassified to conform with the current period
                            presentation.

2.  GOING CONCERN           The accompanying unaudited condensed financial
                            statements were prepared assuming that the Company
                            will continue as a going concern. This basis of
                            accounting contemplates the realization of assets
                            and the satisfaction of liabilities in the normal
                            course of operations. During the nine months ended
                            September 30, 2002, the Company incurred losses of
                            approximately $1.3 million, had a working capital
                            deficiency of $4.5 million, had outstanding
                            redeemable convertible preferred stock that became
                            eligible for redemption at the holder's option for
                            $4.3 million [including accrued dividends] after
                            June 2002 and had not attained a level of revenues
                            sufficient to support recurring expenses. These
                            factors, among others, raise substantial doubt about
                            the Company's ability to continue as a going
                            concern.

                            The Company's continued existence is dependent upon
                            its ability to resolve its liquidity problems,
                            principally by obtaining additional debt financing
                            and equity capital, and ultimately achieving
                            profitable operations. While pursuing additional


                                       4
<PAGE>
                            ULTRASTRIP SYSTEMS, INC.
               NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

                            debt and equity funding, the Company must continue
                            to operate on limited cash flow generated
                            internally.

                            The unaudited condensed financial statements do not
                            include any adjustments to reflect the possible
                            future effects on the recoverability and
                            classification of assets or the amounts and
                            classification of liabilities that may result from
                            the inability of the Company to continue as a going
                            concern. There are no assurances that the Company
                            will be successful in achieving the above plans, or
                            that such plans, if consummated, will enable the
                            Company to obtain profitable operations or continue
                            as a going concern.


3.  NOTE RECEIVABLE         In March 2002, the Company collected a $50,000
    FROM OFFICER            unsecured demand note from an officer, which
                            included interest at 6% per annum.

4.  NOTES PAYABLE TO        Notes payable to related parties consist of the
    RELATED PARTIES         following:

                            September 30,                                   2002
                            ----------------------------------------------------

                            Unsecured notes payable to
                            employee/shareholder, interest at prime
                            plus 2% (6.75% at September 30, 2002).
                            As a result of the Company not making a
                            $450,000 payment due March 31, 2002,
                            the creditor can now demand immediate
                            repayment.                                 $ 454,044

                            Unsecured note payable to
                            employee/shareholder, interest at prime
                            plus 2% (6.75% at September 30, 2002),
                            due April 10, 2003                           517,893

                            $1,000,000 note payable to
                            shareholder/Advisory Board member,
                            balloon payment due on January 17, 2003
                            in the amount of $1,000,000 including
                            interest at 16%, secured by all
                            existing equipment and machinery
                            utilized to manufacture the Company's
                            product, net of unamortized discount (a)     992,917

                            Unsecured notes payable to
                            employee/shareholder, interest at prime
                            plus 2% (6.75% at September 30, 2002),
                            $25,000 due December 27, 2002 and
                            $50,000 due April 19, 2003                    75,000

                            Unsecured note payable to related
                            party, interest at prime plus 2% (6.75%
                            at September 30, 2002), $40,000 due
                            May 8, 2003                                   40,000

                            Unsecured notes payable to officer,
                            interest at prime plus 2% (6.75% at
                            September 30, 2002), $30,000 due April
                            15, 2003; $15,000 due July 11, 2003;
                            $15,000 due September 17, 2003                60,000

                            Unsecured note payable to Director,
                            interest at prime plus 2% (6.75% at
                            September 30, 2002), due March 31, 2003      130,000
                            ----------------------------------------------------

                                                                      $2,269,854
                            ====================================================

                                 5
<PAGE>
                            ULTRASTRIP SYSTEMS, INC.
               NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

                                 (a) On October 18, 2002, the due date for this
                                     note was extended until January 17, 2003 in
                                     exchange for the granting of 62,500
                                     additional warrants to purchase the
                                     Company's Common Stock at an exercise price
                                     of $0.07 per share, that were fully vested
                                     at the date of grant and expire in 2022.

                            In July 2002, the Company issued a promissory note
                            and 25,000 warrants to purchase the Company's Common
                            Stock at an exercise price of $0.07 per share to a
                            shareholder and member of the Company's Board of
                            Advisors for aggregate proceeds of $200,000. This
                            note was repaid by the Company in September 2002.

5.  NOTES PAYABLE           In connection with a $186,000 note payable, the
                            Company granted warrants to acquire 8,001 shares of
                            common stock and valued such warrants at $14,000
                            based on the relative fair value of the warrants.
                            The warrants are exercisable at $0.07 per share,
                            were fully vested at the date of grant and expire in
                            2022. As such the Company recorded $186,000 as debt,
                            net of the allocation of the proceeds to the
                            warrants, which is included in additional paid-in
                            capital in the accompanying unaudited condensed
                            balance sheet of $14,000. The Company amortizes to
                            interest expense the value ascribed to the warrants
                            over the term of the debt.

                            On September 19, 2002, the creditor extended the
                            maturity date of the note to February 21, 2003. In
                            connection with this extension, the Company granted
                            warrants to acquire 12,309 shares of Common Stock
                            and estimated the fair value at $14,765 using the
                            Black-Scholes options pricing model. The warrants
                            are exercisable at $0.07 per share, were fully
                            vested at the date of grant and expire in 2022. As
                            such, the Company recorded $14,765 as debt discount
                            which is included in notes payable in the
                            accompanying unaudited condensed balance sheet. The
                            Company amortizes to interest expense the value of
                            the warrants over the extended term of the debt.


6.  COMMON STOCK            Between January and March 2002, 145,670 shares of
                            Common Stock were issued upon the conversion of
                            Series A and Series B Redeemable, Convertible,
                            Cumulative Preferred Stock.

                                       6
<PAGE>
                            ULTRASTRIP SYSTEMS, INC.
               NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

                            In May 2002, 400,000 restricted, unregistered shares
                            of Common Stock, which had been issued in May 2000
                            pursuant to the terms of an agreement with a service
                            provider, were voluntarily surrendered to the
                            Company.

                            In June 2002, the Company sold 115,385 restricted,
                            unregistered shares of Common Stock to an accredited
                            investor for $150,000 in a transaction exempt under
                            Section 4(2) of the Securities Act of 1933. In
                            September 2002, the Company also sold 100,000
                            restricted, unregistered shares of Common Stock to
                            an accredited investor for $131,000 in a transaction
                            exempt under Section 4(2) of the Securities Act of
                            1933.

                            In June 2002, two holders of warrants to purchase
                            shares of the Company's Common Stock exercised their
                            rights pursuant to a cashless conversion provision
                            in the warrants and were issued 103,000 and 55,462,
                            respectively, restricted, unregistered shares of
                            Common Stock.

                            In September 2002, the Company issued 40,000
                            restricted, unregistered shares of Common Stock to
                            an investor pursuant to a pre-existing subscription
                            agreement.

                            Shares reserved for issuance
                            ----------------------------

                            At September 30, 2002, 12,222,400 shares of Common
                            Stock were reserved for issuance under the Company's
                            two fixed stock option plans, outstanding non-plan
                            options, warrants and upon conversion of the
                            outstanding Series A and Series B Redeemable
                            Convertible Cumulative Preferred Stock.


7.  REDEEMABLE              Series A
    CONVERTIBLE             --------
    CUMULATIVE              At September 30, 2002, there are 28 shares of Series
    PREFERRED STOCK         A Redeemable Convertible Cumulative Preferred Stock
                            outstanding. The shares are redeemable at the option
                            of the Company at $27,500 per share plus accrued
                            dividends, and the shares became redeemable at the
                            option of the holder in June 2002 at $25,000 per
                            share plus accrued dividends.

                            Series B
                            --------
                            At September 30, 2002, there are 1,054 shares of
                            Series B Redeemable Convertible Cumulative Preferred


                                       7
<PAGE>
                            ULTRASTRIP SYSTEMS, INC.
               NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

                            Stock outstanding. The shares are redeemable at the
                            option of the Company at $3,000 per share plus
                            accrued dividends, and the shares became redeemable
                            at the option of the holder in June 2002 at $2,500
                            per share plus accrued dividends.


8.  LOSS PER SHARE          Basic loss per common share is computed on the basis
                            of the weighted average number of common shares
                            outstanding during each period presented. Diluted
                            loss per common share is computed on the basis of
                            the weighted average number of common shares and
                            dilutive securities outstanding. Dilutive securities
                            having an antidilutive effect on diluted loss per
                            common share are excluded from the calculation.

                            The statement of operations for the three months
                            ended September 30, 2001 has been restated to
                            correct a mechanical error in the computation of the
                            non-cash compensation amount provided for variable
                            options with cashless features. Such amount was
                            previously reported as an expense of $4,090,267 and
                            has been adjusted to an expense of $4,415,400.
                            Likewise, net loss per common share was previously
                            reported as $(0.14) and has been adjusted to
                            $(0.15). In addition, a reclassification has been
                            made between accumulated deficit and additional
                            paid-in capital at January 1, 2001 of $2.81 million.

                            The statement of operations for the nine months
                            ended September 30, 2001 has been restated to
                            correct a mechanical error in the computation of the
                            non-cash compensation amount provided for variable
                            options with cashless features. Such amount was
                            previously reported as an expense of $5,721,378 and
                            has been adjusted to an expense of $6,244,000.
                            Likewise, net loss per common share was previously
                            reported as $(0.32) and has been adjusted to
                            $(0.33).

                            The following reconciles the components of the loss
                            per common share computation:
<TABLE>
<CAPTION>
                            For the nine months ended September 30,               2002                                      2001
                            ----------------------------------------------------------------------------------------------------

                                                                     Weighted                                 Weighted
                                                       Income         Average     Per-          Income         Average      Per-
                                                       (Loss)          Shares    Share          (Loss)          Shares     Share
                                                  (Numerator)   (Denominator)   Amount     (Numerator)   (Denominator)    Amount
                            ----------------------------------------------------------------------------------------------------
                            <S>                  <C>               <C>         <C>       <C>                <C>          <C>
                            Loss per common share
                              Net (loss)
                              available to
                              common
                              shareholders       $(1,285,152)      42,443,754  $(0.03)   $(13,582,814)      41,438,544   $(0.33)

                            Effect of Dilutive
                              Securities:
                                Stock
                                options/warrants           --              --       --              --              --        --
                            ----------------------------------------------------------------------------------------------------
                            Net (loss) available
                              to common
                              shareholders
                              plus assumed
                              conversions        $(1,285,152)      42,443,754  $(0.03)   $(13,582,814)      41,438,544   $(0.33)
                            ====================================================================================================
</TABLE>

                                       8
<PAGE>
                            The Company's outstanding options and warrants to
                            acquire common stock and shares of common stock
                            issuable upon conversion of outstanding redeemable
                            convertible cumulative preferred stock (all
                            aggregating 12,222,400 and 18,337,760 shares of
                            common stock at September 30, 2002 and 2001,
                            respectively) are not included in the computation of
                            loss per common share because the effects of
                            inclusion would be anti-dilutive.


9.  COMMITMENT AND          In December 2001, the Company filed a complaint in
    CONTINGENCIES           the Circuit Court in and for Palm Beach County,
                            Florida against Mark H. Mirkin and Mirkin & Woolf,
                            P.A., the Company's former corporate and securities
                            counsel and transfer agent, seeking a declaration
                            from the court that a warrant to purchase 1,653,800
                            shares of the Company's common stock for $0.625 per
                            share was improperly obtained by Mirkin & Woolf,
                            P.A. in April 1998 and is void. Mirkin & Woolf
                            attempted to exercise the warrant in April of 2001.
                            The Company has not issued the underlying shares of
                            common stock. In May 2002, the complaint was amended
                            to remove Mark H. Mirkin as an individual defendant.
                            The Company and its counsel believe that they will
                            prevail in this action and that it will suffer no
                            materially adverse impact as a result of Mirkin &
                            Woolf's counterclaims with respect to the warrant.

                            The Company has commitments with NREC and Carnegie
                            Mellon University, amounting to approximately
                            $464,000 for the purchase of equipment.


10. SUPPLEMENTAL CASH       Supplemental disclosure is as follows:
    FLOW INFORMATION
<TABLE>
<CAPTION>
                            For the nine months ended September 30,           2002      2001
                            ----------------------------------------------------------------
                            <S>                                           <C>        <C>
                            Cash paid for interest                        $ 17,521   $15,072

                            Non-cash investing and financing activities:

                            Conversion of redeemable, convertible,
                              cumulative preferred stock to common stock  $155,000   $255,000

                            Accrued preferred stock dividends             $279,222   $300,000
</TABLE>

                                       9
<PAGE>

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS AND PLAN OF OPERATION.

Certain statements in "Management's Discussion and Analysis of Financial
Condition and Results of Operations" are forward-looking statements that involve
risks and uncertainties. Words such as may, will, should, would, anticipates,
expects, intends, plans, believes, seeks, estimates and similar expressions
identify such forward-looking statements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which reflect management's
analysis only as of the date hereof. The Company assumes no obligation to update
these forward-looking statements to reflect actual results or changes in factors
or assumptions affecting forward-looking statements.

RESULTS OF OPERATIONS

THREE MONTHS ENDED SEPTEMBER 30, 2002
COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2001

REVENUES
--------

Revenues were $2,441,229 for the three months ended September 30, 2002, as
compared to $77,724 for the three months ended September 30, 2001. Revenues for
the three months ended September 30, 2002 were generated largely by the sale of
a prototype automated hydrojetting system to Metro Machine Corporation of
Norfolk, Virginia. On May 13, 2002, the Company entered into an agreement with
Metro Machine Corporation of Norfolk, Virginia for the sale of a prototype
automated hydrojetting system for $2,000,000. A deposit of $500,000 was received
on May 14, 2002. Spare parts and accessories were subsequently added to the
order, increasing the purchase price to $2.3 million. $1.5 million was paid on
August 21, 2002, upon delivery and testing of the equipment at the buyer's
shipyard. The balance was paid on September 25, 2002. In September 2002, the
Company contracted with Metro Machine to provide hydrojetting services,
including additional training and maintenance services.

Revenues for 2002 were generated by equipment sales and service contracts. In
this connection, the Company had equipment sales of $2,346,508 and service
contract revenue of $94,721 for the three months ended September 30, 2002, while
revenues for the three months ended September 30, 2001 were generated solely by
hydrojetting service contracts. The Company currently has no pending orders for
new equipment purchases or service contracts with its customers other than those
discussed in this report.

OPERATING EXPENSES
------------------

Operating expenses decreased from $6,154,050 for the three months ended
September 30, 2001 to $2,271,264 for the three months ended September 30, 2002
as a result of decreases in cost of service contracts, selling, general and
administrative expenses, and non-cash compensation expenses, offset by an
increase in cost of equipment sales. The primary components of operating
expenses were cost of equipment sales, cost of service contracts, selling,
general and administrative expenses and non-cash compensation expenses.

                                       10
<PAGE>

Cost of equipment sales increased from $210,933 for the three months ended
September 30, 2001 to $1,242,825 for the three months ended September 30, 2002
because of equipment sold in the current period. Cost of equipment sales was 53%
of equipment sales in the current period. The Company believes that this
percentage relationship will remain relatively stable in the future, as the
Company expects that future reductions in cost of equipment achieved through
volume purchases may be offset by reductions in equipment retail pricing.

Cost of service contracts decreased from $131,603 for the three months ended
September 30, 2001 to $91,278 for the three months ended September 30, 2002 as a
result of the Company's improved efficiency in the operation of its automated
systems, requiring less expenditure for consumable parts and labor to perform
its services. Cost of hydrojetting service contracts decreased by 73%, from 169%
of service contract revenue in 2001 to 96% of service contract revenue in 2002.
This percentage decrease was the result of improved operational efficiency and
planning. If the Company is able to generate a consistent stream of substantial
service contracts, the Company believes that this percentage relationship will
decrease to the levels achieved in the first three months of 2002 and remain
relatively stable as the Company maintains its operational planning and
execution improvements.

Selling, general and administrative expenses, excluding non-cash compensation,
decreased from $1,298,724 for the three months ended September 30, 2001 to
$931,651 for the three months ended September 30, 2002. The decrease is a result
of the Company's planned reduction in some executive salaries and the Company's
cost-reduction initiatives for discretionary expenses.

Non-cash compensation expense amounted to $5,510 for the three months ended
September 30, 2002, a decrease of $4,507,280 from the prior comparative period.
Non-cash compensation expense for the three months ended September 30, 2002
primarily resulted from stock options and warrants granted to service providers.
The Company no longer requires variable accounting treatment for stock options
to employees and directors with cashless conversion provisions, as these options
expired or were exercised in June 2002.

INCOME (LOSS) FROM OPERATIONS
-----------------------------

Income (loss) from operations for the three months ended September 30, 2002 was
$169,965 as compared to $(6,076,326) for the three months ended September 30,
2001, largely as a result of the increases in revenues and decreases in expenses
described above.

INTEREST EXPENSE
----------------

Interest expense increased from $5,161 to $113,580 for the three months ended
September 30, 2001 and 2002, respectively. This increase was primarily
attributable to interest accretions related to the Company's $1 million note
payable with a shareholder/Advisory Board member.

PREFERRED STOCK DIVIDENDS
-------------------------

Preferred Stock dividends were $92,125 for the three months ended September 30,
2002 and $97,875 for the three months ended September 30, 2001. These dividends
reflect Company obligations to preferred shareholders but have not been paid.

                                       11
<PAGE>

NET LOSS APPLICABLE TO COMMON STOCK
-----------------------------------

Net loss applicable to Common Stock was $35,267 for the three months ended
September 30, 2002, compared to $6,179,362 for the three months ended September
30, 2001. Loss per common share was $0.00 for the three months ended September
30, 2002 and $0.15 for the three months ended September 30, 2001.

NINE MONTHS ENDED SEPTEMBER 30, 2002
COMPARED TO NINE MONTHS ENDED SEPTEMBER 30, 2001

REVENUES
--------

Revenues were $2,763,199 for the nine months ended September 30, 2002, as
compared to $737,524 for the nine months ended September 30, 2001. Revenues for
the nine months ended September 30, 2002 were generated largely by the sale of a
prototype automated hydrojetting system to Metro Machine Corporation of Norfolk,
Virginia. On May 13, 2002, the Company entered into an agreement with Metro
Machine Corporation of Norfolk, Virginia for the sale of a prototype automated
hydrojetting system for $2,000,000. Spare parts and accessories were
subsequently added to the order, increasing the purchase price to $2.3 million.
In August 2002, the Company delivered its automated hydrojetting system. In
September 2002, the Company contracted with Metro Machine to provide
hydrojetting services, including additional training and maintenance services.

Revenues for 2002 were generated by equipment sales and service contracts. In
this connection, the Company had equipment sales of $2,419,093 and service
contract revenue of $344,106 for the nine months ended September 30, 2002, while
revenues for the nine months ended September 30, 2001 were generated solely by
hydrojetting service contracts. The Company currently has no pending orders for
new equipment purchases or service contracts with its customers other than those
discussed in this report.

OPERATING EXPENSES
------------------

Operating expenses decreased from $14,000,105 for the nine months ended
September 30, 2001 to $3,535,766 for the nine months ended September 30, 2002 as
a result of decreases in cost of service contracts, selling, general and
administrative expenses, and non-cash compensation expenses, offset by an
increase in cost of equipment sales. The primary components of operating
expenses were cost of equipment sales, cost of service contracts, selling,
general and administrative expenses and non-cash compensation expenses.

Cost of equipment sales increased from $210,933 for the nine months ended
September 30, 2001 to $1,282,226 for the nine months ended September 30, 2002
because of equipment sold in the current period. Cost of equipment sales was 53%
of equipment sales in the current period. The Company believes that this
percentage relationship will remain constant in the future, as the Company
expects that future reductions in cost of equipment achieved through volume
purchases may be offset by reductions in equipment retail pricing.

Cost of service contracts decreased from $695,127 for the nine months ended
September 30, 2001 to $304,873 for the nine months ended September 30, 2002 as a


                                       12
<PAGE>
result of a lower volume of service contracts performed. Cost of hydrojetting
service contracts decreased by 5%, from 94% of service contract revenue in 2001
to 89% of service contract revenue in 2002. This percentage decrease was the
result of improved operational efficiency and planning. If the Company is able
to generate a consistent stream of substantial service contracts, the Company
believes that this percentage relationship will decrease to the levels achieved
in the first three months of 2002 and remain relatively stable as the Company
maintains its operational planning and execution improvements.

Selling, general and administrative expenses, excluding non-cash compensation,
decreased from $4,356,885 for the nine months ended September 30, 2001 to
$3,210,399 for the nine months ended September 30, 2002. The decrease is a
result of the Company's planned reduction in some executive salaries and the
Company's cost-reduction initiatives for discretionary expenses.

Non-cash compensation expenses (benefit) decreased from $8,737,160 for the nine
months ended September 30, 2001 to $(1,261,732) for the nine months ended
September 30, 2002. Non-cash stock compensation expense (benefit) arises due to
variable option accounting charges pursuant to APB No. 25 in connection with
stock options granted to employees and directors with cashless conversion
provisions. The number of shares of common stock that may be acquired by the
option holder cannot be determined prior to the exercise of the option,
therefore estimates of compensation expense for these options are recorded based
upon the estimated fair value of the stock at each intervening financial
statement date. The Company no longer requires variable accounting treatment for
stock options to employees and directors with cashless conversion provisions, as
these options expired or were exercised in June 2002.

LOSS FROM OPERATIONS
--------------------

Loss from operations for the nine months ended September 30, 2002 was $772,567
as compared to $13,262,581 for the nine months ended September 30, 2001, largely
as a result of the increases in revenues and decreases in expenses described
above.

PREFERRED STOCK DIVIDENDS
-------------------------

Preferred Stock dividends were $279,222 for the nine months ended September 30,
2002 and $300,000 for the nine months ended September 30, 2001. These dividends
reflect Company obligations to preferred shareholders but have not been paid.

NET LOSS APPLICABLE TO COMMON STOCK
-----------------------------------

Net loss applicable to Common Stock was $1,285,152 for the nine months ended
September 30, 2002, compared to $13,582,814 for the nine months ended September
30, 2001. Loss per common share was $0.03 for the nine months ended September
30, 2002 and $0.33 for the nine months ended September 30, 2001.

LIQUIDITY AND CAPITAL RESOURCES

The Company continues to experience losses from operations and is primarily
dependent on outside sources of funding to continue its operations.

                                       13
<PAGE>
At September 30, 2002, the Company's cash and cash equivalents on hand were
$116,340, compared to $543,934 at December 31, 2001. This decrease in cash and
cash equivalents was primarily due to the Company's net loss, increases in
accounts receivable, and decreases in accounts payable-related parties
and deferred revenue, offset partly by the issuance of long-term debt, warrants,
and Common Stock, described below. In light of this increase, management
recognizes that the Company has a continuing need to raise capital to fund its
daily operations and research and development activities.

Since inception, the Company has relied principally upon the proceeds of private
equity financings and loans to fund its working capital requirements and capital
expenditures. Net cash used in operating activities was $1,601,118 for the nine
months ended September 30, 2002, compared to $3,435,988 for the nine months
ended September 30, 2001. This decrease resulted from decreases in the Company's
net loss and customer deposits, and increases in accounts receivable, offset by
decreases in inventories, accounts payable and accrued expenses, accounts
payable-related parties, and deferred revenue.

The Company's net cash provided by (used in) investing activities increased from
$(1,139,962) for the nine months ended September 30, 2001 to $8,772 for the nine
months ended September 30, 2002, primarily as a result of a decrease in new
machinery and equipment purchases.

The Company's net cash provided by financing activities decreased to $1,164,752
for the nine months ended September 30, 2002 from $4,581,986 for the nine months
ended September 30, 2001. The decrease is primarily attributable to a reduction
in $3.4 million proceeds from the issuance of common stock, preferred stock, and
warrants, as well as repayments of long-term debt to related parties of
$1,355,000, offset by an increase in new borrowings from related parties of
$1,547,500 and other borrowings of $200,000.

The Company lacks financial resources to meet its September 30, 2002 working
capital deficit of $4,498,221 and future operating costs.

Due to insufficient cash generated from operations, the Company presently does
not have cash or other resources available to pay its debts, accounts payable
and other liabilities. Some of the Company's debts are past due, and the
preferred stock is presently redeemable at the option of the shareholders.
Obligations are being paid on a month-to-month basis as cash becomes available.
There can be no assurances that the Company's present flow of cash will be
sufficient to meet current and future obligations. The Company has incurred
losses since its inception, and continues to require additional capital to fund
operations and development. As such, the Company's ability to pay its already
incurred obligations is mostly dependent on the Company raising additional
capital in the form of equity or debt.

The Company's short-term and long-term liquidity requirements are expected to
result from working capital needs to purchase inventory, retire existing trade
liabilities and redeemable preferred stock and to pay other operating expenses.
Although the Company cannot accurately predict the precise timing of its future
capital expenditures, the Company estimates that it will need to expend over $4
million, primarily for research and development and operating expenses, within
the next twelve months.

                                       14
<PAGE>
PLAN OF OPERATIONS

The Company's plan of operation for the next twelve months continues to be to
focus on sales and marketing efforts to place its automated hydrojetting systems
into use in the ship maintenance and repair and above ground storage tank
maintenance markets. The Company believes the most effective marketing effort
for its product will be to conduct live demonstrations at shipyards and storage
tank facilities in the United States and in shipyards throughout the world which
are leaders in environmental protection, thereby introducing the marine industry
to automated hydrojetting and demonstrating its superiority to existing surface
preparation methods and competitive technologies.

The Company offers three primary sales options: outright equipment sales,
long-term rental contracts, and contract services. By offering these
alternatives, customers can select the relationship that best matches their
capital allocation plan. The Company also intends to increase the focus of its
marketing efforts on the U.S. market. The Company believes that environmental
regulations are currently a very strong influence on shipyard operations in the
United States and may provide an impetus to shipyards to consider the Company's
products. No such agreements or commitments are currently in place. Under the
Company's business plan, future revenues are also expected, although not
assured, from the sale of spare parts and accessories to those customers that
have purchased or rented robotic hydrojetting systems. No such spare parts
purchase agreement or commitment has been made to date.

In the event that the Company executes future sales orders or rental contracts,
the Company has had discussions with lenders who may provide project finance
funds to cover the costs associated with equipment manufacture. The proceeds
from orders or contracts, the Company's work-in-process and the manufactured
equipment will serve as collateral.

In September 2001, the Company signed an exclusive distributor agreement with
Robotic Environmental Services, LLC (RES) of Baton Rouge, Louisiana for the sale
of the Company's patented automated hydrojetting systems in Louisiana and Texas
and the purchase of one automated hydrojetting system. The distribution
agreement is for a term of five years and established minimum purchase
requirements and other terms necessary to maintain RES' exclusivity in the two
states. RES also received an option from the Company to acquire the exclusive
distribution rights in Venezuela. To exercise this option RES was required to
purchase four additional automated hydrojetting systems by June 30, 2002,
which it has failed to do. RES also failed to meet certain contract requirements
under this distribution agreement in March 2002. The Company informed RES that
it no longer holds exclusive distributor status in Louisiana and Texas. While
the foregoing default may materially affect the Company's future sales to RES,
it also provided the Company with an opportunity to recover the distribution
rights to the exclusive territories and afforded greater flexibility in
negotiating with future customers and distributors. The Company has been in
discussion with RES to explore ways to facilitate the sale of its automated
hydrojetting systems.

                                       15
<PAGE>
On June 11, 2002, the Company announced the sale of a high production prototype
automated hydrojetting system to Metro Machine Corp. of Norfolk, Virginia, the
details of which have been previously discussed in this report. Pursuant to the
terms of its agreement with Metro, the Company also granted to Metro the
non-exclusive right to market the Company's paint removal system in connection
with the marketing of the Metro Ship Coating System. Over the term of the
agreement, which is a period of 16 years, the Company believes the future
systems sales, offered to customers in connection with the Metro system, may be
likely.

Should the number of purchase orders or rental contracts be less than currently
forecasted, or should the sales or rental prices be less than currently
forecasted, there can be no assurance that the Company will be able to generate
sufficient cash flow to sustain operations and meet all payable obligations for
the next twelve months.

The Company has continued to reduce costs. In addition to deferring salaries for
some members of senior management since February 2002, the Company has also
reduced annual salaries for three members of senior management by $300,000, a
reduction of 29% in total senior management salaries. The Company will also
reduce its advertising, travel and entertainment, consulting and office
expenses, among other areas, for further cost reductions.

The Company does not currently anticipate any significant changes in its total
number of employees over the next twelve months. However, should the demand for
the Company's products or contract services increase significantly, the Company
anticipates the need to hire additional employees in the areas of equipment
operation for the performance of contract services, equipment maintenance, field
support and component and spare parts manufacturing.

The Company will seek additional equity capital from private offerings. There is
no assurance that the Company will be able to raise such additional capital. If
the Company is unable to obtain the necessary additional capital, it may be
required to change its business plan and decrease the planned operations, which
could have a material adverse effect upon the business, financial condition, or
results of operations.

In the event that the Company is unable to obtain the requisite funds to
continue its operations as planned, it will be necessary for the Company to
curtail its expenditures and refocus its business plan with a view toward
containing costs. Specific actions to this end might include a reduction in
staff, research and development and marketing expenditures. There can be no
assurance, however, that such cost reductions will be achieved.

GOING CONCERN

The Company's independent auditors stated in their reports that the financial
statements of the Company for the years ended December 31, 2001 and 2000 were
prepared assuming that the Company will continue as a going-concern. For the
years ended December 31, 2001 and 2000, the Company incurred net annual losses
of $4,901,465 and $12,329,568, respectively, had a working capital deficit of
$2,888,483 and $483,670, respectively, and had significant outstanding


                                       16
<PAGE>
redeemable preferred stock that became eligible for redemption at the holder's
option after June 2002. These factors raised substantial doubt about the ability
of the Company to continue as a going concern. Although there are no assurances,
management believes that resources will be available from private sources in
2003 to carry out its business plan described above. The aforementioned
financial statements do not include any adjustments relating to the
recoverability and classification of recorded assets, or the amounts and
classification of liabilities that might be necessary in the event the Company
cannot continue in existence.

Management has established plans intended to increase the sales of the Company's
products. Management intends to seek new capital from new equity securities and
loans to provide funds needed to increase liquidity, fund growth and implement
its business plan; however, no assurance can be given that the Company will be
able to achieve these objectives. If the Company is unable to obtain needed
sources of funds or effect sufficient cost reductions, the Company's liquidity
would be materially adversely affected and it is unlikely that the Company would
continue as a going concern.


ITEM 3.  CONTROLS AND PROCEDURES

The Company carried out an evaluation of the effectiveness of the design and
operation of the Company's disclosure controls and procedures within 90 days
prior to the filing date of this Quarterly Report. Based on that evaluation, the
Chief Executive Officer and Senior Vice President of Finance concluded that the
Company's disclosure controls and procedures are effective in ensuring that
information required to be disclosed in the reports the Company files under the
Exchange Act are recorded, processed and reported as required.

There have been no significant changes in the Company's internal controls or in
other factors that could significantly affect such internal controls subsequent
to the date of the evaluation.

                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

On December 21, 2001, the Company filed a complaint in the Circuit Court in and
for Palm Beach County, Florida against Mark H. Mirkin and Mirkin & Woolf, P.A.,
the Company's former corporate and securities counsel and transfer agent,
seeking a declaration from the court that a warrant to purchase 1,653,800 shares
of the Company's common stock for $0.625 per share obtained by Mirkin & Woolf,
P.A. in April 1998 is void. In May 2002, the Company amended the complaint to
remove Mr. Mirkin as an individual defendant in the complaint. Mirkin & Woolf
attempted to exercise the warrant in April 2001, but shares have not been issued
as the exercise is subject to the resolution of the aforementioned action. The
Company is also seeking the return of all corporate books, files and stock
records, including original stock transfer records, which the defendants
continue to hold in their possession. The Company believes, after consultation


                                       17
<PAGE>
with its counsel, that it will prevail in this action and that it will suffer no
materially adverse impact as a result of Mirkin & Woolf's claims with respect to
the warrant.

ITEM 2.  CHANGES IN SECURITIES.

There has been no change in the rights, preferences or privileges of any
security of the Company during the three months ended September 30, 2002. In
September 2002, the Company sold 100,000 restricted, unregistered shares of
Common Stock to an accredited investor for $131,000 in a transaction exempt
under Section 4(2) of the Securities Act of 1933. In September 2002, the Company
issued 40,000 restricted, unregistered shares of the Company's Common Stock to a
non-accredited investor pursuant to a pre-existing subscription agreement.

During the three months ended September 30, 2002, options to purchase 37,309
shares of the Company's Common Stock were issued in connection with loans to the
Company. The options have exercise prices of $0.07 per share and are exercisable
through 2022. Also during the three months ended September 30, 2002, options to
purchase 2,400,000 shares of the Company's Common Stock which had previously
been issued to directors, officers and service providers expired or were
forfeited.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

During the three months ended September 30, 2002, the Company remained in
default on a promissory note to an employee/shareholder by missing a required
payment of $450,000 for accrued interest and principal due March 31, 2002. As a
result of this, the creditor can demand immediate repayment of the entire debt.
As of September 30, 2002, $435,000 had been repaid on this note. On October 3,
2002, the remaining $15,000 outstanding on this note was converted, with other
amounts loaned to the Company by the employee/shareholder, to a new promissory
note payable on demand.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There were no matters submitted to a vote of security holders during the three
months ended September 30, 2002.

ITEM 5.  OTHER INFORMATION.

On July 30, 2002, Dennis E. McGuire was awarded U.S. Patent #6,425,340 B1 which
granted exclusive use of the method and apparatus for removing coatings from the
hulls of vessels using a magnetic-attraction vehicle and an ultra-high pressure
water jet system. On September 4, 2002, Mr. McGuire assigned this patent to the
Company.

                                       18
<PAGE>
On November 27, 2002, the Company announced that it had been awarded a contract
with the General Services Administration for water jetting services for the
paint preparation of metal surfaces, such as naval shipping, ship decks, storage
tanks, and fuel tanks. The GSA contract is a five-year multiple awards schedules
contract with three-five year options to extend. Federal government agencies may
order equipment and services from the Company on the terms specified in this
contract, however, no orders by federal government agencies have been placed at
this time.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a) EXHIBITS.

<TABLE>
<CAPTION>
Exhibit                                                                                     Prior Filing or
Number                                   Description                                      Sequential Page No.
-------                                  -----------                                      -------------------
<S>                  <C>                                                    <C>
3.1                  Articles of Incorporation, as amended                  Incorporated by reference to Exhibit 2.1 to the
                                                                            Company's Registration Statement on Form 10-SB
                                                                            (the "Form 10-SB").
3.2                  Bylaws                                                 Incorporated by reference to Exhibit 2.2 to the
                                                                            Form 10-SB.
4.1                  Certificate of Designation for the Series A            Incorporated by reference to Exhibit 3.1 to the
                     Preferred Stock                                        Form 10-SB.
4.2                  Certificate of Designation for the Series B            Incorporated by reference to Exhibit 3.2 to the
                     Preferred Stock                                        Form 10-SB.
10.1                 Employment Agreement - Scott Baratta                   Incorporated by reference to Exhibit 10.1 to
                                                                            the Form 10-SB.
10.2                 Employment Agreement - Jacqueline K. McGuire           Incorporated by reference to Exhibit 10.2 to
                                                                            the Form 10-SB.
10.3                 Employment Agreement - John P. Odwazny                 Incorporated by reference to Exhibit 10.3 to
                                                                            the Form 10-SB.
10.4                 Employment Agreement - Michael R. Donn                 Incorporated by reference to Exhibit 10.4 to
                                                                            the Form 10-SB.
10.5                 Employment Agreement - Kevin P. Grady                  Incorporated by reference to Exhibit 10.5 to
                                                                            the Form 10-SB.
10.6                 Employment Agreement - Michael Cristoforo              Incorporated by reference to Exhibit 10.6 to
                                                                            the Form 10-SB.
</TABLE>


                                       19
<PAGE>
<TABLE>
<CAPTION>
Exhibit                                                                                     Prior Filing or
Number                                   Description                                      Sequential Page No.
-------                                  -----------                                      -------------------
<S>                  <C>                                                    <C>
10.7                 Employment Agreement - Robert O. Baratta               Incorporated by reference to Exhibit 10.7 to
                                                                            the Form 10-SB.
10.8                 Development Agreement with Carnegie Mellon             Incorporated by reference to Exhibit 10.8 to
                     University Robotics Institute                          the Form 10-SB.
10.9                 Agreement for Robotic Coatings Removal with Wallem     Incorporated by reference to Exhibit 10.9 to
                     Shipmanagement Ltd.                                    the Form 10-SB.
10.10                Consulting Agreement with T.A.S.T. Corporation         Incorporated by reference to Exhibit 10.10 to
                                                                            the Form 10-SB.
10.11                Consulting Agreement with D.M. Ransom Associates,      Incorporated by reference to Exhibit 10.11 to
                     Inc.                                                   the Form 10-SB.
10.12                1999 Outside Directors Stock Option Plan               Incorporated by reference to Exhibit 10.12 to
                                                                            the Form 10-SB.
10.13                2000 Long Term Incentive Program                       Incorporated by reference to Exhibit 10.13 to
                                                                            the Form 10-SB.
10.14                License Agreement dated July 17, 2000 by and           Incorporated by reference to Exhibit 10.14 to
                     between UltraStrip Systems, Inc. and Ocean Futures     the Form 10-SB.
                     Society
10.15                Promissory Note executed by UltraStrip Systems,        Incorporated by reference to Exhibit 10.15 to
                     Inc. in favor of Kevin P. Grady dated March 16, 2001   the Form 10-SB.
10.16                Full-time Employment Agreement - Robert O. Baratta     Incorporated by reference to Exhibit 10.14 to
                                                                            the Form 10-QSB for the quarter ended March 31,
                                                                            2001.
10.17                Employment Agreement - Dennis McGuire                  Incorporated by reference to Exhibit 10.15 to
                                                                            the Form 10-QSB for the quarter ended March 31,
                                                                            2001.
10.18                Consulting Agreement with George Sterner               Incorporated by reference to Exhibit 10.18 to
                                                                            the Form 10-KSB for the year ended December 31,
                                                                            2001.
10.19                Consulting Agreements (4)                              Incorporated by reference to Exhibit 2.3 to the
                                                                            Form 10-SB.
10.20                Option to Purchase Assets and License Agreement        Incorporated by reference to Exhibit 2.6 to the
                                                                            Form 10-SB
10.21                Subcontract Agreement dated February 9, 2001 by and    Incorporated by reference to Exhibit 10.21 to
                     between Corrosion Engineering Services, Inc. and       the Form 10-QSB/A for the quarter ended March
                     UltraStrip Systems, Inc.                               31, 2001.
</TABLE>


                                       20
<PAGE>
<TABLE>
<CAPTION>
Exhibit                                                                                     Prior Filing or
Number                                   Description                                      Sequential Page No.
-------                                  -----------                                      -------------------
<S>                  <C>                                                    <C>
10.22                Lease and Option to Purchase Agreement dated August    Incorporated by reference to Exhibit 10.22 to
                     9, 2001 between UltraStrip Systems, Inc. and Tecor     the Form 10-QSB/A for the quarter ended
                     - Tecnologia Anticorrosao S.A.                         September 30, 2001.
10.23                Exclusive Distribution Agreement dated September       Incorporated by reference to Exhibit 10.23 to
                     11, 2001 by and between UltraStrip Systems, Inc.       the Form 10-QSB/A for the quarter ended
                     and Robotic Environmental Services, L.L.C.             September 30, 2001.
10.24                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.24 to
                     and Michael Cristoforo dated December 27, 2001         the Form 10-QSB for the quarter ended March 31,
                                                                            2002.
10.25                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.25 to
                     and Dennis McGuire dated March 1, 2002                 the Form 10-QSB for the quarter ended March 31,
                                                                            2002.
10.26                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.26 to
                     and George Sterner dated March 1, 2002                 the Form 10-QSB for the quarter ended March 31,
                                                                            2002.
10.27                Development and Supply Agreement dated May 13, 2002    Incorporated by reference to Exhibit 10.27 to
                     by and between Metro Machine Corp. and UltraStrip      the Form 10-QSB for the quarter ended June 30,
                     Systems, Inc.                                          2002.
10.28                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.28 to
                     and Dennis McGuire dated April 11, 2002                the Form 10-QSB for the quarter ended June 30,
                                                                            2002.
10.29                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.29 to
                     and Kevin Grady dated April 11, 2002                   the Form 10-QSB for the quarter ended June 30,
                                                                            2002.
10.30                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.30 to
                     and Robert Baratta dated April 15, 2002                the Form 10-QSB for the quarter ended June 30,
                                                                            2002.
10.31                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.31 to
                     and Michael Cristoforo dated April 19, 2002            the Form 10-QSB for the quarter ended June 30,
                                                                            2002.
10.32                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.32 to
                     and Dennis and Jacqueline McGuire dated April 25,      the Form 10-QSB for the quarter ended June 30,
                     2002                                                   2002.
10.33                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.33 to
                     and AmClean, Inc. dated May 8, 2002                    the Form 10-QSB for the quarter ended June 30,
                                                                            2002.
</TABLE>


                                       21
<PAGE>
<TABLE>
<CAPTION>
Exhibit                                                                                     Prior Filing or
Number                                   Description                                      Sequential Page No.
-------                                  -----------                                      -------------------
<S>                  <C>                                                    <C>
10.34                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.34 to
                     and Dennis and Jacqueline McGuire dated May 30, 2002   the Form 10-QSB for the quarter ended June 30,
                                                                            2002.
10.35                Promissory Note between UltraStrip Systems, Inc.       Incorporated by reference to Exhibit 10.35 to
                     and Robert Baratta dated June 7, 2002                  the Form 10-QSB for the quarter ended June 30,
                                                                            2002.
10.36                Assignment of U.S. Patent Serial No. 08/854,384        Filed herewith.
                     from Dennis McGuire to UltraStrip Systems, Inc.
10.37                Promissory Note between UltraStrip Systems, Inc.       Filed herewith.
                     and Eugene Rainis dated July 3, 2002
10.38                Promissory Note between UltraStrip Systems, Inc.       Filed herewith.
                     and Robert Baratta dated July 11, 2002
10.39                Promissory Note between UltraStrip Systems, Inc.       Filed herewith.
                     and Robert Baratta dated September 17, 2002
</TABLE>

(b) REPORTS ON FORM 8-K. One report was filed on Form 8-K during the three
months ended September 30, 2002. On August 16, 2002, the Company filed a Form
8-K announcing its financial results for the year ended December 31, 2001, as
well as a restatement of its previously reported financial results for 1999 and
2000 and its previously reported quarterly financial statements for prior
periods.

                                       22
<PAGE>

                                   SIGNATURES

         In accordance with the requirements of the Securities and Exchange Act
of 1934, as amended, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.


                                    ULTRASTRIP SYSTEMS, INC.

         June 4, 2003               /s/ Robert O. Baratta
                                    ----------------------------------------
                                    Robert O. Baratta
                                    President, Chief Executive Officer
                                    and Vice Chairman of the Board


         June 4, 2003               /s/ Scott R. Baratta
                                    ----------------------------------------
                                    Scott R. Baratta
                                    Senior Vice President - Finance
                                    (Chief Financial and Accounting Officer)

                                       23
<PAGE>

                                  CERTIFICATION

In connection with the Quarterly Report of UltraStrip Systems, Inc. (the
"Company") on Form 10-QSB for the period ended September 30, 2002, as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), the
undersigned certify pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
to his knowledge that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.



/s/ Robert O. Baratta
---------------------------------------------------------
President and Chief Executive Officer


/s/ Scott R. Baratta
---------------------------------------------------------
Senior Vice President - Finance (Chief Financial Officer)

                                       24
<PAGE>
                                 CERTIFICATIONS

I, Robert O. Baratta, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of UltraStrip Systems,
Inc;

2. Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3. Based on my knowledge, the unaudited, condensed financial statements, and
other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the small business issuer as of, and for, the periods presented in this
report;

4. The small business issuer's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures and internal
controls and procedures for financial reporting (as defined in Exchange Act
Rules 13a-14 and 15d-14) for the small business issuer and we have:

         a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the issuer is made known to us by
others within the Company, particularly during the period in which this report
is being prepared;

         b) Designed such internal controls and procedures for financial
reporting, or caused such internal controls and procedures for financial
reporting to be designed under their supervision, to provide reasonable
assurances that the small business issuer's financial statements are fairly
presented in conformity with accounting principles generally accepted in the
United States of America;

         c) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and internal controls and procedures for
financial reporting as of the end of the period covered by this report
("Evaluation Date");

         d) Presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures and internal controls and procedures for
financial reporting based on our evaluation as of the Evaluation Date;

         e) Disclosed to the small business issuer's auditors and the audit
committee of the board of directors (or persons fulfilling the equivalent
function);

                  i) All significant deficiencies and material weaknesses in the
design or operation of internal controls and procedures for financial reporting


                                       25
<PAGE>
which could adversely affect the small business issuer's ability to record,
process, summarize and report financial information required to be disclosed by
the small business issuer in the reports that it files or submits under the Act
(15 U.S.C. 78a et seq.), within the time periods specified in the U.S.
Securities and Exchange Commission's rules and forms; and

                  ii) Any fraud, whether or not material, that involves
management or other employees who have a significant role in the small business
issuer's internal controls and procedures for financial reporting; and

         f) Indicated in this report any significant changes in the small
business issuer's internal controls and procedures for financial reporting or in
other factors that could significantly affect internal controls and procedures
for financial reporting made during the period covered by this report, including
any actions taken to correct significant deficiencies and material weaknesses in
the small business issuer's internal controls and procedures for financial
reporting.



Date:  June 4, 2003                         /s/ Robert O. Baratta
                                            ----------------------------------
                                            Robert O. Baratta
                                            President, Chief Executive Officer
                                            and Vice Chairman of the Board

                                       26
<PAGE>
                                 CERTIFICATIONS

I, Scott R. Baratta, certify that:

1. I have reviewed this quarterly report on Form 10-QSB of UltraStrip Systems,
Inc;

2. Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;

3. Based on my knowledge, the unaudited, condensed financial statements, and
other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash flows
of the small business issuer as of, and for, the periods presented in this
report;

4. The small business issuer's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures and internal
controls and procedures for financial reporting (as defined in Exchange Act
Rules 13a-14 and 15d-14) for the small business issuer and we have:

         a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the issuer is made known to us by
others within the Company, particularly during the period in which this report
is being prepared;

         b) Designed such internal controls and procedures for financial
reporting, or caused such internal controls and procedures for financial
reporting to be designed under their supervision, to provide reasonable
assurances that the small business issuer's financial statements are fairly
presented in conformity with accounting principles generally accepted in the
United States of America;

         c) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and internal controls and procedures for
financial reporting as of the end of the period covered by this report
("Evaluation Date");

         d) Presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures and internal controls and procedures for
financial reporting based on our evaluation as of the Evaluation Date;

         e) Disclosed to the small business issuer's auditors and the audit
committee of the board of directors (or persons fulfilling the equivalent
function);

                  i) All significant deficiencies and material weaknesses in the
design or operation of internal controls and procedures for financial reporting


                                       27
<PAGE>
which could adversely affect the small business issuer's ability to record,
process, summarize and report financial information required to be disclosed by
the small business issuer in the reports that it files or submits under the Act
(15 U.S.C. 78a et seq.), within the time periods specified in the U.S.
Securities and Exchange Commission's rules and forms; and

                  ii) Any fraud, whether or not material, that involves
management or other employees who have a significant role in the small business
issuer's internal controls and procedures for financial reporting; and

         f) Indicated in this report any significant changes in the small
business issuer's internal controls and procedures for financial reporting or in
other factors that could significantly affect internal controls and procedures
for financial reporting made during the period covered by this report, including
any actions taken to correct significant deficiencies and material weaknesses in
the small business issuer's internal controls and procedures for financial
reporting.



Date:  June 4, 2003                           /s/ Scott R. Baratta
                                              -------------------------------
                                              Scott R. Baratta
                                              Senior Vice President - Finance
                                              (Chief Financial Officer)

                                       28