##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-QSB
  þ
    
    Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended August 31, 2006
 or
 o
    
    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: 1-13484
 COHESANT TECHNOLOGIES INC.
  Delaware
    
    34-1775913(State or other jurisdiction of 
Incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 5845 West 82nd Street, Suite 102, Indianapolis, Indiana
    
    46278(Address of principal executive offices)
    
    (Zip Code)
 317-871-7611
 
  þ o
 o þ
  o þ




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##### 



COHESANT TECHNOLOGIES INC.
 INDEX
 TABLE OF CONTENTS
 PAGEPART IItem 1.
    
    Financial InformationCohesant Technologies Inc. Condensed Consolidated Balance Sheets as of August 31, 2006 and November 30, 2005
    
    3Cohesant Technologies Inc. Condensed Consolidated Statements of Operations for the Three Months Ended August 31, 2006 and August 31, 2005
    
    4Cohesant Technologies Inc. Condensed Consolidated Statements of Operations for the Nine Months Ended August 31, 2006 and August 31, 2005
    
    5Cohesant Technologies Inc. Condensed Consolidated Statements of Cash Flows for the Nine Months Ended August 31, 2006 and August 31, 2005
    
    6Notes to Condensed Consolidated Financial Statements
    
    7Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    16Item 3.
    
    Controls and Procedures
    
    23PART IIItem 4.
    
    Submission of Matters to Vote of Security Holders
    
    23Item 5.
    
    Other information
    
    24Item 6.
    
    Exhibits and Reports on Form 8-K
    
    24SignaturesEX-31.1EX-31.2EX-32
  2




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##### Table of Contents



PART I
 
 ITEM 1. FINANCIAL INFORMATION
 COHESANT TECHNOLOGIES INC.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 August 31, 2006
    
    
    November 30, 2005(Unaudited)ASSETS:Cash and cash equivalents
    
    $
    826,373
    
    
    $
    2,238,281Accounts receivable, net of allowance for doubtful
accounts of $312,803 and $284,628, respectively
    
    
    4,508,585
    
    
    
    4,125,062Inventories, net of allowance for obsolete and slow-moving
inventories of $225,316 and $195,425, respectively
    
    
    4,027,756
    
    
    
    3,490,087Prepaid expenses and other
    
    
    466,643
    
    
    
    333,751Deferred tax assets
    
    
    240,200
    
    
    
    240,200Total Current Assets
    
    
    10,069,557
    
    
    
    10,427,381Property, plant and equipment, net
    
    
    2,009,777
    
    
    
    991,730License agreements, patents and other intangibles, net
    
    
    1,151,062
    
    
    
    1,392,499Goodwill
    
    
    8,150,090
    
    
    
    8,223,913Other noncurrent assets
    
    
    8,935
    
    
    
    8,484Total Assets
    
    $
    21,389,421
    
    
    $
    21,044,007LIABILITIES AND SHAREHOLDERS EQUITY:Accounts payable
    
    $
    1,726,899
    
    
    $
    1,622,153Accrued salaries, benefits and commissions
    
    
    629,171
    
    
    
    1,047,938Accrued income taxes
    
    
    766,786
    
    
    
    387,242Billings in excess of costs and estimated earnings
    
    
    31,701
    
    
    
    133,844Due to former owners of acquired business
    
    
    
    
    
    
    473,707Other current liabilities
    
    
    327,502
    
    
    
    480,787Total Current Liabilities
    
    
    3,482,059
    
    
    
    4,145,671Deferred tax liability
    
    
    243,700
    
    
    
    243,700Total Liabilities
    
    
    3,725,759
    
    
    
    4,389,371Commitments and ContingenciesShareholders Equity:Common stock ($.001 par value, 10,000,000 shares
authorized and 3,153,264 and 3,123,089 shares issued
and outstanding, respectively)
    
    
    3,153
    
    
    
    3,123Additional paid-in capital
    
    
    11,402,879
    
    
    
    11,230,959Accumulated other comprehensive income
    
    
    33,943
    
    
    
    11,384Retained earnings
    
    
    6,223,687
    
    
    
    5,409,170Total Shareholders Equity
    
    
    17,663,662
    
    
    
    16,654,636Total Liabilities and Shareholders Equity
    
    $
    21,389,421
    
    
    $
    21,044,007
  3




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 For the Three Months EndedAugust 31, 2006
    
    
    August 31, 2005NET SALES
    
    $
    6,370,753
    
    
    $
    5,620,990COST OF SALES
    
    
    3,362,318
    
    
    
    2,904,038Gross profit
    
    
    3,008,435
    
    
    
    2,716,952RESEARCH AND DEVELOPMENT EXPENSES
    
    
    310,359
    
    
    
    256,095SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    2,099,524
    
    
    
    1,764,980TOTAL OPERATING EXPENSES
    
    
    2,409,883
    
    
    
    2,021,075Income from operations
    
    
    598,552
    
    
    
    695,877OTHER INCOME:Interest income
    
    
    2,595
    
    
    
    27,136Other income, net
    
    
    9,973
    
    
    
    8,701INCOME BEFORE TAXES
    
    
    611,120
    
    
    
    731,714INCOME TAX PROVISION
    
    
    (232,147
    )
    
    
    (280,470
    )NET INCOME
    
    $
    378,973
    
    
    $
    451,244EARNINGS PER COMMON SHARE:BASIC
    
    $
    0.12
    
    
    $
    0.16DILUTED
    
    $
    0.12
    
    
    $
    0.16AVERAGE SHARES OF COMMON STOCK
OUTSTANDING:BASIC
    
    
    3,151,045
    
    
    
    2,753,320DILUTED
    
    
    3,284,140
    
    
    
    2,839,734COMPREHENSIVE INCOMENet income
    
    $
    378,973
    
    
    $
    451,244Foreign currency translation adjustment
    
    
    (11,780
    )
    
    
    3,370NET COMPREHENSIVE INCOME
    
    $
    367,193
    
    
    $
    454,614
  4




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 For the Nine Months EndedAugust 31, 2006
    
    
    August 31, 2005NET SALES
    
    $
    19,628,750
    
    
    $
    15,584,746COST OF SALES
    
    
    10,624,739
    
    
    
    8,239,998Gross profit
    
    
    9,004,011
    
    
    
    7,344,748RESEARCH AND DEVELOPMENT EXPENSES
    
    
    861,305
    
    
    
    727,226SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    6,140,511
    
    
    
    4,942,778TOTAL OPERATING EXPENSES
    
    
    7,001,816
    
    
    
    5,670,004Income from operations
    
    
    2,002,195
    
    
    
    1,674,744OTHER INCOME:Interest income
    
    
    14,364
    
    
    
    77,294Other income, net
    
    
    17,150
    
    
    
    19,388INCOME BEFORE TAXES
    
    
    2,033,709
    
    
    
    1,771,426INCOME TAX PROVISION
    
    
    (772,810
    )
    
    
    (675,561
    )NET INCOME
    
    $
    1,260,899
    
    
    $
    1,095,865EARNINGS PER COMMON SHARE:BASIC
    
    $
    0.40
    
    
    $
    0.41DILUTED
    
    $
    0.39
    
    
    $
    0.40AVERAGE SHARES OF COMMON STOCK
OUTSTANDING:BASIC
    
    
    3,135,317
    
    
    
    2,674,008DILUTED
    
    
    3,262,860
    
    
    
    2,769,287CASH DIVIDENDS PER SHARE
    
    $
    0.14
    
    
    $
    0.135COMPREHENSIVE INCOMENet income
    
    $
    1,260,899
    
    
    $
    1,095,865Foreign currency translation adjustment
    
    
    22,559
    
    
    
    3,370NET COMPREHENSIVE INCOME
    
    $
    1,283,458
    
    
    $
    1,099,235
  5




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 For the Nine Months EndedAugust 31, 2006
    
    
    August 31, 2005CASH FLOWS PROVIDED BY
OPERATING ACTIVITIES:Net income
    
    $
    1,260,899
    
    
    $
    1,095,865Adjustments to reconcile net income to net cash
provided by operating activities -Depreciation and amortization
    
    
    362,609
    
    
    
    172,108Non-cash compensation
    
    
    97,155
    
    
    
    115,645Loss on asset disposal
    
    
    1,090
    
    
    
    126Provision for doubtful accounts
    
    
    28,175
    
    
    
    10,205Net change in assets and liabilities-Accounts receivable
    
    
    (486,598
    )
    
    
    (249,660
    )Inventories
    
    
    (551,587
    )
    
    
    (320,184
    )Prepaid expenses and other
    
    
    (132,892
    )
    
    
    (71,771
    )Accounts payable
    
    
    104,746
    
    
    
    1,037,306Other current liabilities
    
    
    (144,534
    )
    
    
    316,027Billings in excess of costs and estimated earnings
    
    
    (102,143
    )
    
    
    Other noncurrent assets
    
    
    (26,915
    )
    
    
    (12,516
    )Net cash provided by operating activities
    
    
    410,005
    
    
    
    2,093,151CASH FLOWS USED IN INVESTING ACTIVITIES:Property and equipment additions
    
    
    (1,260,415
    )
    
    
    (170,831
    )Proceeds from sale of property & equipment
    
    
    350
    
    
    
    13,370Acquisition of CuraFlo
    
    
    
    
    
    
    (4,548,092
    )Payment to former owners of acquired business
    
    
    (342,136
    )
    
    
    Return of cash paid for acquisition of CuraFlo
    
    
    77,250
    
    
    
    Net cash used in investing activities
    
    
    (1,524,951
    )
    
    
    (4,705,553
    )CASH FLOWS USED IN FINANCING ACTIVITIES:Proceeds from note receivable  restricted stock
    
    
    40,262
    
    
    
    Proceeds from exercise of stock options
    
    
    109,158
    
    
    
    91,705Cash dividends paid to stockholders
    
    
    (446,382
    )
    
    
    (710,780
    )Net cash used in financing activities
    
    
    (296,962
    )
    
    
    (619,075
    )NET DECREASE IN CASH
AND CASH EQUIVALENTS
    
    
    (1,411,908
    )
    
    
    (3,231,477
    )CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD
    
    
    2,238,281
    
    
    
    5,036,582CASH AND CASH EQUIVALENTS AT
END OF PERIOD
    
    $
    826,373
    
    
    $
    1,805,105
  6




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Note 1  Background
     7




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  Note 2  Basis of Presentation
     Note 3  Acquisition of CuraFlo
  8




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
    Current assets
    
    $
    959,682Property & equipment
    
    
    227,483Intangible assets
    
    
    1,160,303Goodwill
    
    
    7,309,836Total assets acquired
    
    
    9,657,304Liabilities assumed
    
    
    (768,022
    )Net assets acquired
    
    $
    8,889,282
 Unaudited pro forma results
  9




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Three Months Ended August 31,
    
    Nine Months Ended August 31,2006
    
    2005
    
    2006
    
    2005Revenue
    
    $
    6,370,753
    
    
    $
    7,003,879
    
    
    $
    19,628,750
    
    
    $
    19,340,671Net Income
    
    
    378,973
    
    
    
    703,043
    
    
    
    1,260,899
    
    
    
    1,438,331Basic earnings per share
    
    
    0.12
    
    
    
    0.23
    
    
    
    0.40
    
    
    
    0.46Diluted earnings per share:
    
    
    0.12
    
    
    
    0.22
    
    
    
    0.39
    
    
    
    0.45
  Note 4  Earnings per Share
   Three Months Ended August 31,
    
    Nine Months Ended August 31,2006
    
    2005
    
    2006
    
    2005Income available to common
stockholders
    
    $
    378,973
    
    
    $
    451,244
    
    
    $
    1,260,899
    
    
    $
    1,095,865Basic earnings per share:Weighted-average number of
common shares outstanding
    
    
    3,151,045
    
    
    
    2,753,320
    
    
    
    3,135,317
    
    
    
    2,674,008Basic earnings per share
    
    $
    0.12
    
    
    $
    0.16
    
    
    $
    0.40
    
    
    $
    0.41Diluted earnings per share:Weighted-average number of
common shares outstanding
    
    
    3,151,045
    
    
    
    2,753,320
    
    
    
    3,135,317
    
    
    
    2,674,008Stock Options
    
    
    103,707
    
    
    
    79,975
    
    
    
    100,558
    
    
    
    87,048Restricted Stock
    
    
    29,388
    
    
    
    6,439
    
    
    
    26,985
    
    
    
    8,231Diluted weighted-average
number of
common shares outstanding
    
    
    3,284,140
    
    
    
    2,839,734
    
    
    
    3,262,860
    
    
    
    2,769,287Diluted earnings per share
    
    $
    0.12
    
    
    $
    0.16
    
    
    $
    0.39
    
    
    $
    0.40
 10




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Note 5  Accounting for Stock-Based Compensation
  3 Months Ended
    
    
    9 Months EndedAugust 31
    
    
    August 312006
    
    
    2005
    
    
    2006
    
    
    2005Net income, as reported
    
    $
    378,973
    
    
    $
    451,244
    
    
    $
    1,260,899
    
    
    $
    1,095,865Add: Stock-based
employee compensation
expense included in
reported net income,
net of related tax
effects
    
    
    19,699
    
    
    
    21,532
    
    
    
    60,237
    
    
    
    71,700Deduct: Total
stock-based employee
compensation expense
determined under fair
value based method for
all awards, net of
related tax effects
    
    
    (64,912
    )
    
    
    (34,063
    )
    
    
    (222,098
    )
    
    
    (109,293
    )Pro forma net income
    
    $
    333,760
    
    
    $
    438,713
    
    
    $
    1,099,038
    
    
    $
    1,058,272Earnings per share:Basicas reported
    
    $
    0.12
    
    
    $
    0.16
    
    
    $
    0.40
    
    
    $
    0.41Basicpro forma
    
    $
    0.11
    
    
    $
    0.16
    
    
    $
    0.35
    
    
    $
    0.40Dilutedas reported
    
    $
    0.12
    
    
    $
    0.16
    
    
    $
    0.39
    
    
    $
    0.40Dilutedpro forma
    
    $
    0.10
    
    
    $
    0.15
    
    
    $
    0.34
    
    
    $
    0.38
    11




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Note 6  Costs and Estimated Earnings on Uncompleted Contracts
  Costs incurred on uncompleted contracts
    
    $
    1,268,336Estimated earnings to date
    
    
    434,365Subtotal
    
    
    1,702,701Less  Billings to date
    
    
    (1,734,402
    )Total
    
    $
    (31,701
    )Included in the accompanying balance sheet under the following caption:Costs and estimated earnings in excess of billings
    
    $
    Billings in excess of costs and estimated earnings
    
    
    (31,701
    )Total
    
    $
    (31,701
    )
  Note 7  Revolving Line of Credit
  Note 8  Segment Information
  12




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
   Three Months EndedAugust 31, 2006
    
    CIPAR
    
    CMI
    
    GCI
    
    Corporate
    
    Eliminations
    
    ConsolidatedNet Sales:External customers
    
    $
    2,426,123
    
    
    $
    66,724
    
    
    $
    3,877,906
    
    
    $
    
    
    
    $
    
    
    
    $
    6,370,753Intersegment sales
    
    
    
    
    
    
    843,433
    
    
    
    
    
    
    
    
    
    
    
    (843,433
    )
    
    
    Total net sales
    
    
    2,426,123
    
    
    
    910,157
    
    
    
    3,877,906
    
    
    
    
    
    
    
    (843,433
    )
    
    
    6,370,753Depreciation and
amortization:
    
    
    34,748
    
    
    
    10,145
    
    
    
    84,097
    
    
    
    1,020
    
    
    
    
    
    
    
    130,010Net income (loss):
    
    
    64,486
    
    
    
    89,821
    
    
    
    502,031
    
    
    
    (277,365
    )
    
    
    
    
    
    
    378,973Identifiable assets:
    
    
    11,511,587
    
    
    
    1,126,406
    
    
    
    7,263,747
    
    
    
    1,487,681
    
    
    
    
    
    
    
    21,389,421Capital expenditures:
    
    
    175,472
    
    
    
    5,869
    
    
    
    165,695
    
    
    
    167,061
    
    
    
    
    
    
    
    514,097
 Three Months EndedAugust 31, 2005
    
    CIPAR
    
    CMI
    
    GCI
    
    Corporate
    
    Eliminations
    
    ConsolidatedNet Sales:External customers
    
    $
    1,824,814
    
    
    $
    134,782
    
    
    $
    3,661,394
    
    
    $
    
    
    
    $
    
    
    
    $
    5,620,990Intersegment sales
    
    
    
    
    
    
    963,109
    
    
    
    
    
    
    
    
    
    
    
    (963,109
    )
    
    
    Total net sales
    
    
    1,824,814
    
    
    
    1,097,891
    
    
    
    3,661,394
    
    
    
    
    
    
    
    (963,109
    )
    
    
    5,620,990Depreciation and
amortization:
    
    
    16,589
    
    
    
    4,772
    
    
    
    42,701
    
    
    
    914
    
    
    
    
    
    
    
    64,976Net income (loss):
    
    
    167,835
    
    
    
    138,418
    
    
    
    418,947
    
    
    
    (273,956
    )
    
    
    
    
    
    
    451,244Identifiable assets:
    
    
    11,507,227
    
    
    
    946,066
    
    
    
    6,289,393
    
    
    
    2,079,058
    
    
    
    
    
    
    
    20,821,744Capital expenditures:
    
    
    1,767
    
    
    
    6,114
    
    
    
    48,080
    
    
    
    447
    
    
    
    
    
    
    
    56,408
 Nine Months EndedAugust 31, 2006
    
    CIPAR
    
    CMI
    
    GCI
    
    Corporate
    
    Eliminations
    
    ConsolidatedNet Sales:External customers
    
    $
    8,501,787
    
    
    $
    204,269
    
    
    $
    10,922,694
    
    
    $
    
    
    
    $
    
    
    
    $
    19,628,750Intersegment sales
    
    
    
    
    
    
    2,530,464
    
    
    
    
    
    
    
    
    
    
    
    (2,530,464
    )
    
    
    Total net sales
    
    
    8,501,787
    
    
    
    2,734,733
    
    
    
    10,922,694
    
    
    
    
    
    
    
    (2,530,464
    )
    
    
    19,628,750Depreciation and
amortization:
    
    
    148,228
    
    
    
    23,843
    
    
    
    188,063
    
    
    
    2,475
    
    
    
    
    
    
    
    362,609Net income (loss):
    
    
    482,917
    
    
    
    298,670
    
    
    
    1,294,168
    
    
    
    (814,856
    )
    
    
    
    
    
    
    1,260,899Identifiable assets:
    
    
    11,511,587
    
    
    
    1,126,406
    
    
    
    7,263,747
    
    
    
    1,487,681
    
    
    
    
    
    
    
    21,389,421Capital expenditures:
    
    
    198,423
    
    
    
    122,143
    
    
    
    543,435
    
    
    
    396,414
    
    
    
    
    
    
    
    1,260,415
 13




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Nine Months EndedAugust 31, 2005
    
    CIPAR
    
    CMI
    
    GCI
    
    Corporate
    
    Eliminations
    
    ConsolidatedNet Sales:External customers
    
    $
    4,828,503
    
    
    $
    402,783
    
    
    $
    10,353,460
    
    
    $
    
    
    
    $
    
    
    
    $
    15,584,746Intersegment sales
    
    
    
    
    
    
    2,525,657
    
    
    
    
    
    
    
    
    
    
    
    (2,525,657
    )
    
    
    Total net sales
    
    
    4,828,503
    
    
    
    2,928,440
    
    
    
    10,353,460
    
    
    
    
    
    
    
    (2,525,657
    )
    
    
    15,584,746Depreciation and
amortization:
    
    
    26,329
    
    
    
    17,576
    
    
    
    123,169
    
    
    
    5,034
    
    
    
    
    
    
    
    172,108Net income (loss):
    
    
    383,309
    
    
    
    332,780
    
    
    
    1,140,081
    
    
    
    (760,305
    )
    
    
    
    
    
    
    1,095,865Identifiable assets:
    
    
    11,507,227
    
    
    
    946,066
    
    
    
    6,289,393
    
    
    
    2,079,058
    
    
    
    
    
    
    
    20,821,744Capital expenditures:
    
    
    3,350
    
    
    
    7,248
    
    
    
    158,393
    
    
    
    1,840
    
    
    
    
    
    
    
    170,831
  Three Months Ended August 31,2006
    
    2005Equipment and Parts
    
    $
    3,931,145
    
    
    
    61.7
    %
    
    $
    3,698,434
    
    
    
    65.8
    %Coatings
    
    
    1,526,965
    
    
    
    24.0
    
    
    
    1,746,288
    
    
    
    31.1Licensee
    
    
    28,034
    
    
    
    0.4
    
    
    
    15,638
    
    
    
    0.2Rehabilitation
    
    
    884,609
    
    
    
    13.9
    
    
    
    160,630
    
    
    
    2.9Total
    
    $
    6,370,753
    
    
    
    100
    %
    
    $
    5,620,990
    
    
    
    100
    %
 Nine Months Ended August 31,2006
    
    2005Equipment and Parts
    
    $
    11,568,061
    
    
    
    58.9
    %
    
    $
    10,782,690
    
    
    
    69.2
    %Coatings
    
    
    4,537,086
    
    
    
    23.1
    
    
    
    4,601,585
    
    
    
    29.5Licensee
    
    
    133,472
    
    
    
    0.7
    
    
    
    39,841
    
    
    
    0.3Rehabilitation
    
    
    3,390,131
    
    
    
    17.3
    
    
    
    160,630
    
    
    
    1.0Total
    
    $
    19,628,750
    
    
    
    100
    %
    
    $
    15,584,746
    
    
    
    100
    %
  Nine Months
    
    Nine MonthsThree Months Ended
    
    Three Months Ended
    
    Ended
    
    EndedRegion
    
    August 31, 2006
    
    August 31, 2005
    
    August 31, 2006
    
    August 31, 2005United States
    
    
    57
    
    
    
    65
    
    
    
    57
    
    
    
    67Canada
    
    
    20
    
    
    
    8
    
    
    
    19
    
    
    
    7Asia/Pacific Rim
    
    
    10
    
    
    
    12
    
    
    
    10
    
    
    
    11Europe
    
    
    9
    
    
    
    10
    
    
    
    9
    
    
    
    10Other
    
    
    4
    
    
    
    5
    
    
    
    5
    
    
    
    5Total
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
 14




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Note 9  Contingencies
  Note 10  Dividends
  Note 11  Common Stock
  Note 12  Subsequent Event
  15




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
 Acquisition of CuraFlo
   Reconfiguration of Business Units
  16




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
     Results of Operations
 Three months ended August 31, 2006 as compared to the same period in the prior year.
  17




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
        18




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
 Nine months ended August 31, 2006 as compared to the same period in the prior year.
       19




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
  Liquidity and Capital Resources
      20




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
    Critical Accounting Policies and Estimates
    Revenue Recognition.
  21




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
   Accounts receivable.
 Inventory .
  Goodwill.
  Forward Looking Statements
  22




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
  
 ITEM 3. CONTROLS AND PROCEDURES
    
 PART II
 
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 a)
    
    The Companys annual meeting of stockholders was held on June 16, 2006.b)
    
    At the annual meeting, the Companys stockholders reelected Morton A. Cohen, Dwight
D. Goodman, Michael L. Boeckman, Richard L. Immerman, Terrence R. Ozan, and Morris H.
Wheeler as Directors for a term that expires at the annual meeting of stockholders in
2007.c)
    
    At the annual meeting, the Companys stockholders ratified the appointment of Ernst
& Young LLP as auditors of the Company for fiscal 2006. The holders of 3,030,185 shares
of Common Stock voted to ratify the appointment, the holders of 2,444 shares voted
against the ratification and the holders of 130 shares abstained.
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##### Table of Contents



COHESANT TECHNOLOGIES INC.
  WithheldFor
    
    AuthorityMichael L. Boeckman
    
    
    2,943,327
    
    
    
    89,432Morton A. Cohen
    
    
    2,973,311
    
    
    
    59,448Dwight D. Goodman
    
    
    2,920,592
    
    
    
    112,167Richard L. Immerman
    
    
    2,983,366
    
    
    
    49,393Terrence R. Ozan
    
    
    3,027,215
    
    
    
    5,544Morris H. Wheeler
    
    
    2,972,773
    
    
    
    59,986
 
 ITEM 5. OTHER INFORMATION
  
 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
 (a)
    
    Exhibit
 31.1
    
    302 Certification of Chief Executive Officer31.2
    
    302 Certification of Chief Financial Officer32
    
    906 Certification of Chief Executive Officer and Chief Financial Officer
 (b)
    
    Reports on Form 8-KAn 8-K was filed on June 20, 2006 to report the following; earnings for the second
quarter and six months ended May 31, 2006 (Items 2.02 and 9.01), the announcement of the
Companys stock repurchase program and the election of Morton A. Cohen as Chairman of the
Board of Directors effective September 1, 2006 (Item 8.01 and 9.01).
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##### Table of Contents



SIGNATURES
   COHESANT TECHNOLOGIES INC.BY:
    
    /s/ Morris H. WheelerMorris H. Wheeler
President & Chief Executive OfficerBY:
    
    /s/ Robert W. PawlakRobert W. Pawlak
Chief Financial Officer
 25