-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QIdjXJWdM/Fzzye9N2Jq5HsOsVyaw7P/NS7EIpph6FbXUkAhG1OXSQoLhzzCYWNq tjYtLQDaea+DT7cRh5IOrQ== 0000788738-02-000182.txt : 20020807 0000788738-02-000182.hdr.sgml : 20020807 20020807150723 ACCESSION NUMBER: 0000788738-02-000182 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20020630 FILED AS OF DATE: 20020807 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TORCHMAIL COMMUNICATIONS INC CENTRAL INDEX KEY: 0000030966 STANDARD INDUSTRIAL CLASSIFICATION: GRAIN MILL PRODUCTS [2040] IRS NUMBER: 952312900 STATE OF INCORPORATION: CA FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 001-07894 FILM NUMBER: 02721721 BUSINESS ADDRESS: STREET 1: 268 WEST 400 SOUTH SUITE 300 CITY: SALT LAKE CITY STATE: U0 ZIP: 84101 BUSINESS PHONE: 801-575-8073 MAIL ADDRESS: STREET 1: 268 WEST 400 SOUTH SUITE 300 CITY: SALT LAKE CITY STATE: U0 ZIP: 84101 FORMER COMPANY: FORMER CONFORMED NAME: EARLY CALIFORNIA FOODS INC DATE OF NAME CHANGE: 19700114 FORMER COMPANY: FORMER CONFORMED NAME: EARLY CALIFORNIA INDUSTRIES INC DATE OF NAME CHANGE: 19851202 FORMER COMPANY: FORMER CONFORMED NAME: ERLY INDUSTRIES INC DATE OF NAME CHANGE: 19920703 10QSB 1 torchmail10qjune02.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB (Mark One) [X] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended June 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: 001-07894 ----------- TORCHMAIL COMMUNICATIONS, INC. -------------------------------- (Exact name of small business issuer as specified in its charter) Delaware 95-2312900 -------- ---------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 268 West 400 South, Suite 300, Salt Lake City, Utah 84101 ---------------------------------------------------------------------- (Address of principal executive office) (Zip Code) (801) 575-8073 (Issuer's telephone number) Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ----- ------ The number of outstanding shares of the issuer's common stock, $0.001 par value (the only class of voting stock), as of August 1, 2002 was 3,773,375. TABLE OF CONTENTS PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS................................................3 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION...........4 PART II - OTHER INFORMATION ITEM 3. CHANGES IN SECURITIES AND USE OF PROCEEDS...........................5 SIGNATURES...................................................................6 INDEX TO EXHIBITS............................................................7 [THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK] 2 ITEM 1. FINANCIAL STATEMENTS As used herein, the term "Company" refers to Torchmail Communications, Inc., a Delaware corporation, its consolidated entities, and predecessors unless otherwise indicated. Unaudited, condensed interim financial statements including a balance sheet for the Company as of the quarter ended June 30, 2002, and statements of operations, and statements of cash flows for the interim period up to the date of such balance sheet and the period from inception, August 21, 1999, through June 30, 2002, are attached hereto as Pages F-1 through F-5 and are incorporated herein by this reference. [THIS SPACE HAS BEEN LEFT BLANK INTENTIONALLY.] 3 INDEX TO FINANCIAL STATEMENTS PAGE Condensed Unaudited Balance Sheet......................................F-2 Statements of Unaudited Condensed Operations...........................F-3 Statements of Unaudited Condensed Cash Flows...........................F-4 Notes to Unaudited Financial Statements................................F-5 F-1 TORCHMAIL COMMUNICATIONS, INC. (A Development Stage Company) UNAUDITED CONDENSED BALANCE SHEET June 30, 2002 Unaudited June 30, 2002 ----------- ASSETS CURRENT ASSETS Investments, available for sale $ 12,500 ----------- Total Current Assets 12,500 TOTAL ASSETS $ 12,500 ----------- ----------- LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts Payable 17,614 Related party payable 21,332 ----------- Total Current Liabilities 38,946 TOTAL LIABILITIES $ 38,946 ----------- ----------- SHAREHOLDERS' EQUITY Preferred stock, $.001 par value, 10,000,000 shares authorized; issued and outstanding -0- shares - Common stock, $0.001 par value, 200,000,000 shares authorized, 3,773,375 shares issued and outstanding 3,773 Additional Paid in Capital 181,922 Deficit accumulated during the development stage (212,141) ----------- Total Stockholders' Deficit (26,446) ----------- TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 12,500 -----------
See Notes To Financial Statements. F-2 TORCHMAIL COMMUNICATIONS, INC. (A Development Stage Company) UNAUDITED STATEMENTS OF OPERATIONS
From inception (August 21, For the three months ended 1999) June 30, to June 30, 2002 2001 2002 ----------- ----------- ------------- Sales $ - $ - $ - General and Administrative 2,330 33,728 505,083 ----------- ----------- ------------- Loss From Operations (2,330) (33,728) (505,083) ----------- ----------- ------------- Other Income Refund of funds previously expended - - 194,382 Interest income - - 7,329 ----------- ----------- ------------- Total Other Income - - 201,711 ----------- ----------- ------------- Loss before taxes and extraordinary items (2,330) (33,728) (303,372) Provision for income taxes - - - ----------- ----------- ------------- Loss before extraordinary items (2,330) (33,728) (303,372) Extraordinary items - gain on forgiveness of debt, net of $0 taxes - - 91,231 Net Loss $ (2,330) $ (33,728) $ (212,141) Loss per share $ - $ (0.22) Weighted average shares outstanding* 3,773,000 153,000 ----------- ----------- * adjusted for 5 for 1 forward split
See Notes to Financial Statements. F-3 TORCHMAIL COMMUNICATIONS, INC. (A Development Stage Company) UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
From inception For the Three Months (August 21, Ended 1999) June 30, to June 30, 2002 2001 2002 -------- ----------- ---------- Cash Flows from Operating Activities Net Loss (2,330) $ (33,728) $ 212,141) Adjustments to reconcile net loss to net cash used in operating activities: Increase in accounts payable - - 17,614 Issuance of common stock for services - 33,728 46,228 Increase in related party payable 2,330 - 28,299 -------- ----------- ---------- Net Cash Used in Operating Activities - - 120,000) -------- ----------- ---------- Cash flow from Investing Activities - - - -------- ----------- ---------- Cash flow from Financing Activities Issuance of common stock for cash - - 120,000 -------- ----------- ---------- Net Cash Provided by Financing Activities - - 120,000 -------- ----------- ---------- Net Increase (Decrease) in Cash - - - Cash at Beginning of Period - - - -------- ----------- ---------- Cash at End of Period $ - $ - $ - -------- ----------- ---------- Supplemental Disclosures Interest paid $ - $ - $ - Income taxes paid - - -
See Notes to Financial Statements. F-4 TORCHMAIL COMMUNICATIONS, INC. (A Development Stage Company) Notes to the Unaudited Financial Statements June 30, 2002 NOTE 1 - PRELIMINARY NOTE The accompanying condensed financial statements have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in the financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. These financial statements reflect all adjustments which, in the opinion of management, are necessary to present a fair statement of the results for the periods included. It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto included in the Company's Annual Report on Form 10KSB for the period ended March 31, 2002. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Marketable Securities The Company classifies its marketable debt and equity securities as "held to maturity" if it has the positive intent and ability to hold the securities to maturity. All other marketable debt and equity securities are classified as "available for sale." Securities classified as "available for sale" are carried in the financial statements at fair value. Realized gains and losses, determined using the specific identification method, are included in operations; unrealized holding gains and losses are reported as a separate component of equity. Securities classified as held to maturity are carried at amortized cost. For both categories of securities, declines in fair value below amortized cost NOTE 3 - COMMON STOCK SPLITS On March 17, 2002, the Company approved a 5-for-1 common stock split and on January 26, 2001, as part of the merger agreement between Torchmail and Erly, the Company completed a 1-for-100 reverse common stock split. All common share amounts and per share information have been retroactively adjusted to reflect these common stock splits in the accompanying consolidated financial statements. F-5 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION Plan of Operations As used herein the term "Company" refers to Torchmail Communications, Inc., a Delaware corporation, its consolidated entities, and its predecessors, unless the context indicates otherwise. The Company emerged from bankruptcy on August 21, 1999 as Erly Industries, Inc. The Company's business plan is to acquire operations through an acquisition, merger or to begin its own start-up business. The Company has no current operations and no significant current cash needs. One of the Company's major shareholders, Hudson Consulting Group, Inc. has been funding cash needs due to the lack of assets and is expected to continue funding needs at least through the end of the coming year. The Company is in the process of attempting to identify and acquire a favorable business opportunity. On March 22, 2000, the Board of Directors accepted the terms of an agreement to provide a controlling interest of the Company's common stock to a subsidiary of Axia Group, Inc. (Hudson Consulting Group, Inc.) for $120,000 cash. This transaction was ratified at a special board meeting on October 9, 2000. The Company then issued 9,237,912 shares of common stock to Hudson. The Company's board of directors then appointed Richard Surber to the board on November 14, 2000. All other members of the Company's Board of Directors then resigned leaving Richard D. Surber as the sole member of the Company's Board of Directors. On January 24, 2001, the Company merged with Torchmail Communications Inc., a Delaware corporation ("Torchmail"). In the merger, shareholders of Erly Industries, Inc. common stock received 1 share of Torchmail common stock for every 100 shares of Erly stock owned. Fractional shares were rounded up to the next whole share. The authorized number of shares of Torchmail is 200,000,000 shares. Following the reverse stock split, the Company had a total of 150,000 shares issued and outstanding. On June 15, 2001, the Company issued 500,000 shares of common stock (post-reverse split) to Hudson Consulting Group, Inc., a Nevada Corporation for services rendered in preparing financial statements and also to pay for expenses previously paid by Hudson in the Company's behalf. The Company is currently a 78.5% owned subsidiary of Nexia Holdings, Inc., which is a subsidiary of Axia Group, Inc. On March 17, 2002, the Company effected a 5 for 1 forward split to all shareholders of record on the date March 15, 2002. Fractional shares were rounded up to the nearest share. The Company's plan of operation for the coming year is to identify and acquire a favorable business opportunity. The Company does not plan to limit its options to any particular industry, but will evaluate each opportunity on its merits. The Company recently signed a letter of intent to merge with a company in California. However, since the deal has not been finalized, management believes it would be premature to disclose the specifics of the letter of intent. It is expected that this will be completed within the 2nd quarter of the year. Since the Company has no operations at present, its cash needs are minimal. The Company believes it can meet its cash needs for the foreseeable future from its current assets or from payments made in its behalf by Hudson Consulting Group, Inc. The Company has no plans for the purchase or sale of any plant or equipment during the coming fiscal year. 4 The Company was briefly a holding company but is now, at the time of this filing, a development stage company and currently has no employees. The Company has no current plans to make any changes in the number of employees. PART II-OTHER INFORMATION ITEM 3. CHANGES IN SECURITIES AND USE OF PROCEEDS None. SIGNATURES In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, this 1st day of August, 2002. Torchmail Communications, Inc. /s/ Rowan S. Campbell ---------------------------- Rowan S. Campbell, President In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. /s/ Rowan S. Campbell - -------------------------------------- Rowan S. Campbell, President & Director August 7, 2002 /s/ Christina Barnes - ------------------------- Christina Barnes, Director August 7, 2002 /s/ Richard Surber - ----------------------- Richard Surber, Director August 7, 2002 5 INDEX TO EXHIBITS EXHIBIT PAGE NO. NO. DESCRIPTION 3(i) * Articles of Incorporation of Torchmail Communications, Inc. (Incorporated by reference from Form 14C filed 12/19/2000). 3(ii) * Agreement of Merger of Erly Industries, Inc. into Torchmail Communications, Inc. (Incorporated by reference from Form 10-QSB filed August 1, 2001). * Incorporated by reference from previous filings of the Company. 6 -----END PRIVACY-ENHANCED MESSAGE-----