-----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, Wannp/x7lmgYk8YLiwBfuWuEHgCwnlZ3OZNqNhfr5LoJWlw4gownfkPwg4i4qrOM fZ9WXKMc7XyOAVFXfdbwCg== 0000950110-01-500253.txt : 20010618 0000950110-01-500253.hdr.sgml : 20010618 ACCESSION NUMBER: 0000950110-01-500253 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010430 FILED AS OF DATE: 20010615 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TASTY FRIES INC CENTRAL INDEX KEY: 0000791885 STANDARD INDUSTRIAL CLASSIFICATION: PATENT OWNERS & LESSORS [6794] IRS NUMBER: 650159052 STATE OF INCORPORATION: NV FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 033-04460-NY FILM NUMBER: 1661466 BUSINESS ADDRESS: STREET 1: 650 SENTRY PKWY STE ONE CITY: BLUE BELL STATE: PA ZIP: 19422 BUSINESS PHONE: 6109412109 MAIL ADDRESS: STREET 1: 650 SENTRY PARKWAY STREET 2: SUITE ONE CITY: BLUE BELL STATE: PA ZIP: 19422 10QSB 1 e85445_10qsb.txt U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB [X] QUARTERLY REPORT OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended April 30, 2001 Commission File No. 33-4460-NY ------------------------------- TASTY FRIES, INC. (Exact name of registrant as specified in its charter) ------------------------------- NEVADA 65-0259052 State or other jurisdiction (I.R.S. Employer incorporation or organization Identification No.) 650 SENTRY PARKWAY, SUITE ONE BLUE BELL, PENNSYLVANIA 19422 (Address Of Principal Executive Offices) (Zip Code) (610) 941-2109 (Registrant's telephone number, include area code) ADELAIDE HOLDINGS, INC. 11098 Biscayne Boulevard, Suite 403 Miami, Florida (305) 899-0200 (Former name and address) Check whether the registrant (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 --- --- As of April 30, 2001: 43,891,511 shares of common stock were outstanding. TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) BALANCE SHEETS - -------------------------------------------------------------------------------------------------
APRIL 30, January 31, 2001 2001 ------------ ------------ (UNAUDITED) ASSETS CURRENT ASSETS Cash $ 27,650 $ 86,978 ------------ ------------ TOTAL CURRENT ASSETS 27,650 86,978 FURNITURE AND OFFICE EQUIPMENT, net of accumulated depreciation of $69,245, April 30, 2001 and $67,641, January 31, 2001 8,450 10,054 ------------ ------------ TOTAL ASSETS $ 36,100 $ 97,032 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIENCY CURRENT LIABILITIES Accounts payable and accrued expenses $ 427,439 $ 565,064 Stockholder loans payable 325,000 270,000 ------------ ------------ TOTAL CURRENT LIABILITIES 752,439 835,064 ------------ ------------ UNEARNED REVENUE 320,000 320,000 ------------ ------------ COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY DEFICIENCY Common stock, $.001 par value Authorized 100,000,000 shares Issued and outstanding 43,891,511 shares, April 30, 2001 and 40,734,011 shares, January 31, 2001 43,892 40,734 Additional paid-in capital 25,634,201 24,400,084 Deficit accumulated in the development stage (26,714,432) (25,498,850) ------------ ------------ TOTAL STOCKHOLDERS' EQUITY DEFICIENCY (1,036,339) (1,058,032) ------------ ------------ TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY DEFICIENCY $ 36,100 $ 97,032 ============ ============
See notes to financial statements 2 TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF OPERATIONS THREE MONTHS ENDED APRIL 30, 2001 AND 2000 AND OCTOBER 18, 1985 (INCEPTION) TO APRIL 30, 2001 - --------------------------------------------------------------------------------------------------
Cumulative Three Months Ended April 30 Since ---------------------------- Inception 2001 2000 ------------ ----------- ----------- (Unaudited) (UNAUDITED) (Unaudited) REVENUES $ -- $ -- $ -- ------------ ----------- ---------- COSTS AND EXPENSES Research, machine and product development 4,196,462 428,060 169,951 Selling, general and administrative 18,499,069 456,450 538,488 ------------ ----------- ---------- TOTAL COSTS AND EXPENSES 22,695,531 884,510 708,439 ------------ ----------- ---------- LOSS BEFORE OTHER INCOME (EXPENSE) (22,695,531) (884,510) (708,439) ------------ ----------- ---------- OTHER INCOME (EXPENSE) Interest income 21,274 -- -- Forfeited distributor deposits 15,000 -- -- Stock purchase discount (2,093,052) (319,000) (254,850) Interest expense (1,962,123) (12,072) (16,619) ------------ ----------- ---------- TOTAL OTHER INCOME (EXPENSE) (4,018,901) (331,072) (271,469) ------------ ----------- ---------- NET LOSS $(26,714,432) $(1,215,582) $ (979,908) ============ =========== ========== NET LOSS PER SHARE OF COMMON STOCK ($0.03) ($0.03) =========== ========== WEIGHTED AVERAGE SHARES OUTSTANDING 42,342,694 28,505,746 =========== ==========
See notes to financial statements 3 TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY DEFICIENCY OCTOBER 18, 1985 (INCEPTION) TO APRIL 30, 2001
- ----------------------------------------------------------------------------------------------------- Deficit Accumulated Total in the Stockholders' Common Additional Development Equity Stock Paid-in Capital Stage (Deficiency) ------------ --------------- ----------- -------------- BALANCE, FEBRUARY 1, 1991 $ 157,307 $ (156,307) $ -- $ 1,000 ISSUED 1,114,679 SHARES FOR NOTE CONVERSION 11,147 113,853 -- 125,000 NET LOSS FOR THE YEAR ENDED JANUARY 31, 1992 -- -- (198,425) (198,425) ----------- ----------- ----------- ----------- BALANCE, JANUARY 31, 1992 168,454 (42,454) (198,425) (72,425) ISSUED 4,275,000 SHARES 42,750 457,250 -- 500,000 ISSUED 150,000 SHARES FOR SERVICES 1,500 36,000 -- 37,500 NET LOSS FOR THE YEAR ENDED JANUARY 31, 1993 -- -- (773,304) (773,304) ----------- ----------- ----------- ----------- BALANCE, JANUARY 31, 1993 212,704 450,796 (971,729) (308,229) ISSUED 7,600,000 SHARES 76,000 464,000 -- 540,000 ISSUED 220,000 SHARES FOR SERVICES 2,200 -- -- 2,200 REDEEMED 3,145,000 SHARES (31,450) 31,450 -- -- NET LOSS FOR THE YEAR ENDED JANUARY 31, 1994 -- -- (658,820) (658,820) ----------- ----------- ----------- ----------- BALANCE, JANUARY 31, 1994 259,454 946,246 (1,630,549) (424,849) ISSUED 3,129,999 SHARES 31,300 547,950 -- 579,250 ISSUED 2,151,622 SHARES FOR SERVICES 21,516 121,294 -- 142,810 ISSUED 1,000,000 SHARES FOR LITIGATION SETTLEMENT 10,000 460,000 -- 470,000 NET LOSS FOR THE YEAR ENDED JANUARY 31, 1995 -- -- (2,148,933) (2,148,933) ----------- ----------- ----------- ----------- BALANCE, JANUARY 31, 1995 (CARRIED FORWARD) 322,270 2,075,490 (3,779,482) (1,381,722)
(continued) See notes to financial statements 4 TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY DEFICIENCY OCTOBER 18, 1985 (INCEPTION) TO APRIL 30, 2001 - -------------------------------------------------------------------------------- (continued)
Deficit Accumulated Total in the Stockholders' Common Additional Development Equity Stock Paid-in Capital Stage (Deficiency) -------- --------------- ----------- ------------- BALANCE, JANUARY 31, 1995 (BROUGHT FORWARD) 322,270 2,075,490 (3,779,482) (1,381,722) ISSUED 21,815,000 SHARES 218,150 1,054,350 -- 1,272,500 ISSUED 6,733,502 SHARES FOR SERVICES 67,335 381,880 -- 449,215 ISSUED 625,000 SHARES FOR LOAN CONVERSION 6,250 43,750 -- 50,000 ISSUED 1,000,000 SHARES FOR REPURCHASE OF DISTRIBUTORSHIP 10,000 90,000 -- 100,000 REVERSE STOCK SPLIT (620,885) 620,885 -- -- NET LOSS FOR THE YEAR ENDED JANUARY 31, 1996 -- -- (1,384,488) (1,384,488) -------- --------- ---------- ---------- BALANCE, JANUARY 31, 1996 3,120 4,266,355 (5,163,970) (894,495) ISSUED 1,455,000 SHARES 1,455 1,506,045 -- 1,507,500 ISSUED 125,000 SHARES FOR SERVICES 125 324,875 -- 325,000 NET LOSS FOR THE YEAR ENDED JANUARY 31, 1997 -- -- (2,172,260) (2,172,260) -------- --------- ---------- ---------- BALANCE, JANUARY 31, 1997 (CARRIED FORWARD) 4,700 6,097,275 (7,336,230) (1,234,255)
(continued) See notes to financial statements 5 TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY DEFICIENCY OCTOBER 18, 1985 (INCEPTION) TO APRIL 30, 2001 - -------------------------------------------------------------------------------- (continued)
Deficit Accumulated Total in the Stockholders' Common Additional Development Equity Stock Paid-in Capital Stage (Deficiency) ------ --------------- ------------ ------------- BALANCE, JANUARY 31, 1997 (BROUGHT FORWARD) 4,700 6,097,275 (7,336,230) (1,234,255) ISSUED 1,500,000 SHARES FOR NON-RECURRING COMPENSATION 1,500 1,029,750 -- 1,031,250 ISSUED 167,083 SHARES 167 80,650 -- 80,817 ISSUED 955,000 SHARES FOR SERVICES 955 1,317,545 -- 1,318,500 ISSUED 43,750 SHARES FOR LITIGATION SETTLEMENT 44 54,644 -- 54,688 ISSUED 700,000 SHARES FOR CONVERTIBLE NOTES 700 566,979 -- 567,679 ISSUED 452,772 SHARES FOR REPAYMENT OF NOTES PAYABLE 452 523,587 -- 524,039 ISSUED 120,000 SHARES FOR REPAYMENT OF NOTES PAYABLE, OFFICER/DIRECTOR 120 175,830 -- 175,950 NET LOSS FOR THE YEAR ENDED JANUARY 31, 1998 -- -- (5,074,155) (5,074,155) ------ ---------- ----------- ---------- BALANCE, JANUARY 31, 1998 8,638 9,846,260 (12,410,385) (2,555,487) ISSUED 2,251,307 SHARES 2,252 1,299,526 -- 1,301,778 ISSUED 5,586,150 SHARES FOR CONVERTIBLE NOTES 5,586 3,129,504 -- 3,135,090 ISSUED 42,704 SHARES FOR INTEREST ON CONVERTIBLE NOTES 43 26,385 -- 26,428 ISSUED 1,226,815 SHARES FOR SERVICES 1,227 490,652 -- 491,879 ISSUED 250,000 SHARES FOR REPURCHASE OF DISTRIBUTORSHIP 250 124,750 -- 125,000 NET LOSS FOR THE YEAR ENDED JANUARY 31, 1999 -- -- (3,512,124) (3,512,124) ------ ---------- ----------- ---------- BALANCE, JANUARY 31, 1999 (CARRIED FORWARD) 17,996 14,917,077 (15,922,509) (987,436)
(continued) See notes to financial statements 6 TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY DEFICIENCY OCTOBER 18, 1985 (INCEPTION) TO APRIL 30, 2001 - -------------------------------------------------------------------------------- (continued)
Deficit Accumulated Total in the Stockholders' Common Additional Development Equity Stock Paid-in Capital Stage (Deficiency) -------- --------------- ------------ ------------- BALANCE, JANUARY 31, 1999 (AS RESTATED) (BROUGHT FORWARD) 17,996 14,917,077 (15,922,509) (987,436) ISSUED 3,789,000 SHARES 3,789 1,624,291 -- 1,628,080 ISSUED 250,000 SHARES FOR LITIGATION SETTLEMENT 250 124,750 -- 125,000 ISSUED 6,184,405 SHARES FOR SERVICEs 6,184 2,799,214 -- 2,805,398 ISSUED 500,000 SHARES FOR REPURCHASE OF DISTRIBUTORSHIP 500 249,500 -- 250,000 NET LOSS FOR THE YEAR ENDED JANUARY 31, 2000 -- -- (5,783,657) (5,783,657) -------- ------------ ------------ ------------ BALANCE, JANUARY 31, 2000 28,719 19,714,832 (21,706,166) (1,962,615) ISSUED 3,660,000 SHARES 3,660 1,228,140 -- 1,231,800 ISSUED 3,155,000 SHARES FOR SERVICES 3,155 1,312,312 -- 1,315,467 ISSUED 4,000,000 SHARES FOR REPAYMENT OF NOTE PAYABLE 4,000 1,596,000 -- 1,600,000 ISSUED 1,200,000 SHARES FOR PAYMENT OF ACCRUED EXPENSES 1,200 548,800 -- 550,000 NET LOSS FOR THE YEAR ENDED JANUARY 31, 2001 -- -- (3,792,684) (3,792,684) -------- ------------ ------------ ------------ BALANCE, JANUARY 31, 2001 40,734 24,400,084 (25,498,850) (1,058,032) ISSUED 1,200,000 SHARES (UNAUDITED) 1,200 168,800 -- 170,000 ISSUED 1,957,500 SHARES FOR SERVICES (UNAUDITED) 1,958 1,065,317 -- 1,067,275 NET LOSS FOR THE THREE MONTHS (UNAUDITED) -- -- (1,215,582) (1,215,582) -------- ------------ ------------ ------------ BALANCE, APRIL 30, 2001 (UNAUDITED) $ 43,892 $ 25,634,201 $(26,714,432) $ (1,036,339) ======== ============ ============ ============
See notes to financial statements 7 TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED APRIL 30, 2001 AND 2000 AND OCTOBER 18, 1985 (INCEPTION) TO APRIL 30, 2001 - --------------------------------------------------------------------------------
Cumulative Three Months Ended April 30 Since --------------------------- Inception 2001 2000 ----------- ----------- ----------- (Unaudited) (UNAUDITED) (Unaudited) ----------- ----------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES $(26,714,432) $ (1,215,582) $ (979,908) Net loss Adjustments to reconcile net loss to net cash used in operating activities Depreciation and amortization 306,101 1,604 2,796 Common stock issued for services 8,902,856 748,275 239,700 Common stock issued for litigation settlement 649,689 - - Stock purchase discount 2,093,052 319,000 254,850 Common stock issued for interest on convertible notes 1,129,196 - - Common stock issued for repurchase of distributorships 250,000 - - Accrued interest on notes and convertible notes payable 398,576 - - Increase in assets Other assets - - (5,000) Increase (decrease) in liabilities Accounts payable and accrued expenses 977,439 (137,625) (76,051) Unearned revenue 320,000 - 120,000 ------------ ------------ ------------ NET CASH USED IN OPERATING ACTIVITIES (11,687,523) (284,328) (443,613) ------------ ------------ ------------ CASH FLOWS FROM INVESTING ACTIVITIES Purchase of furniture and office equipment (77,695) - - Loan costs (236,856) - - ------------ ------------ ------------ NET CASH USED IN INVESTING ACTIVITIES (314,551) - - ------------ ------------ ------------ CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from convertible notes payable 2,600,000 - - Issuance of common stock 8,250,173 170,000 600,000 Costs of raising capital (318,700) - - Loan payable, shareholder 55,000 55,000 - Note payable, current 1,363,251 - 24,000 Officer/director note 80,000 - - ------------ ------------ ------------ NET CASH PROVIDED BY FINANCING ACTIVITIES 12,029,724 225,000 624,000 ------------ ------------ ------------ INCREASE (DECREASE) IN CASH (CARRIED FORWARD) 27,650 (59,328) 180,387
(continued) See notes to financial statements 8 TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED APRIL 30, 2001 AND 2000 AND OCTOBER 18, 1985 (INCEPTION) TO APRIL 30, 2001 - -------------------------------------------------------------------------------- (continued)
Cumulative Three Months Ended April 30 Since --------------------------- Inception 2001 2000 ----------- ----------- ----------- (Unaudited) (UNAUDITED) (Unaudited) ----------- ----------- ----------- INCREASE (DECREASE) IN CASH (BROUGHT FORWARD) 27,650 (59,328) 180,387 CASH, BEGINNING OF PERIOD - 86,978 10,703 ---------- ---------- ---------- CASH, END OF PERIOD $ 27,650 $ 27,650 $ 191,090 ========== ========== ========== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Cash paid during the period for interest $ 54,803 $ - $ - ========== ========== ========== SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES Issuance of common stock for services $8,902,856 $ 748,275 $ 239,700 Issuance of common stock for conversion of note payable 2,675,000 - - Issuance of common stock for repurchase of distributorship 475,000 - - Issuance of common stock for litigation settlement 649,689 - - Accrued interest on notes payable 398,577 - - Issuance of common stock to pay accrued expenses 550,000 - - Issuance of common stock to pay note payable 900,000 - -
See notes to financial statements 9 TASTY FRIES, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED APRIL 30, 2001 (UNAUDITED) NOTE 1. BASIS OF PRESENTATION The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended April 30, 2001 are not necessarily indicative of the results that may be expected for the year ended January 31, 2002. The unaudited financial statements should be read in conjunction with the financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended January 31, 2001. NOTE 2. DESCRIPTION OF BUSINESS The Company is a development stage company, having not yet completed the process of manufacturing and marketing its sole product, a vending machine which will cook and dispense french fries. The Company has incurred research and development costs from inception to April 30, 2001 totaling $4,196,000. The Company is currently in the process of completing its first 25 machines. The costs associated with the production of the machines have been charged to research, machine and product development costs. The Company had no revenues from operations since inception and its ability to continue as a going concern is dependent on the continuation of equity financing to fund the expenses relating to successfully manufacturing and marketing the vending machine. ITEM 2. PLAN OF OPERATION General ------- The Company is a development-stage company having not yet completed the exercise of manufacturing, marketing and selling its sole product, a vending machine, which will cook and dispense French fries (the "Machine"). The Company has tested the Machine both internally and on various beta locations since December of 1995. During the period ending April 30, 2001, the Company entered into the production stage of its lifecycle, having spent the latter half of fiscal 2000 preparing for commercial manufacturing through the process of pre-production tooling and completion of final production design work. 10 Liquidity and Capital Resources ------------------------------- Since its inception, the Company has had no revenues from operations and has relied almost exclusively on shareholder loans, limited distribution deposits and sale of securities to raise working capital to fund operations. At April 30, 2001 the Company had approximately $28,000 in cash. While management currently anticipates that the April 1998 financing will allow it to complete the Company's initial production run of machines, no assurances can be given that the Company will be able to do so. Further, the Company will need to secure additional funds to allow it to enter into its second production run of machines, in line with management's current plan of operation. No assurances can be given that the Company will be able to secure adequate financing from any source to pursue its current plan of operation, to meet its obligations or to expand its marketing efforts over the next 12 months. Based upon its past history, management believes that it may be able to obtain funding in such manner but is unable to predict with any certainty the amount and terms thereof. If the Company is unable to obtain needed funds, it could be forced to curtail or cease its activities. The Company has, in the past, issued shares of common stock and warrants to purchase common stock to various parties as payment for services rendered. The Company intends to continue this practice. ITEM 3. FORWARD-LOOKING STATEMENTS When used in this report and in future filings by the Company with the Commission, in the Registrant's press releases or other public or stockholder communications, and in oral statements made with the approval of an authorized executive officer, the words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project" or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including the Company's liquidity constraints, potential increases in manufacturing costs and delays, pending litigation, availability of raw materials, competition, demand for the Machine and other proprietary products, and delays in the distribution process that could cause actual results to differ materially from those presently anticipated or projected. The Company wishes to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. The Company wishes to advise readers that actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods in any current statements. The Company does not undertake - and specifically, declines any obligation - -- to publicly release the result of any revisions, which may be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events. 11 PART II -- OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS In May 1991, the Company entered into a joint venture agreement with California Food and Vending, Inc. ("CFV"), another vending and food service company with a high interest in the research and development of a french fry vending machine. The companies planned to work together in the manufacturing and marketing of a french fry machine. Disputes arose between the parties, litigation was instituted by CFV and in July 1999 the disputes were settled and the litigation dismissed. Pursuant to the settlement agreement, the Company regained our distributorship rights for the State of California; agreed to pay CFV the sum of $1,000,000, which has been paid; issue 250,000 shares of our common stock to CFV; and CFV will receive $350 for each of the first 500 machines produced and $450 thereafter and $.25 for each pound of potato product sold by Tasty Fries. On August 28, 1996, the Company, Edward C. Kelly and Premier Design, Ltd., were added as defendants to a civil lawsuit in the Riverside County Branch of the Superior Court of the State of California brought by Prize Frize, Inc., William Bartfield and Larry Wirth. The suit also named as defendants approximately 25 other parties, all allegedly involved, in some manner, in the pursuit of the french fry vending machine concept and/or business. The case was removed to Federal Court. The Company successfully moved for dismissal of the claim on behalf of itself and Mr. Kelly; the case was dismissed on June 2, 1997. The dismissal was reversed on appeal by the Federal Court and the case was remanded to State Court. The plaintiffs' claim against Tasty Fries was severed. The claims against Edward C. Kelly and Premier Design, Ltd. were dismissed. The claim brought by Prize Frize asserts that the Company had usurped its basic trade secrets by developing a french fry vending machine, which utilizes the Basic American Food potato product. The Company denies the allegations and is vigorously defending the litigation. It is the opinion of the Company's counsel that Prize Frizes' lawsuit lacks merit and that the Company will prevail. ITEM 2. CHANGES IN SECURITIES None ITEM 3. DEFAULTS UPON SENIOR SECURITIES None ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None ITEM 5. OTHER INFORMATION See Part II, Item 1. Above ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K None 12 SIGNATURES In accordance with the requirements of the exchange act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. TASTY FRIES, INC. Edward C. Kelly President and Principal Financial Officer Date: June 13, 2001 Officer 13 -----END PRIVACY-ENHANCED MESSAGE-----