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 December 31, 1999.
[ ] Transition report under Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from ______ to ______ .
Commission file number: 33-2128-D
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ERLY INDUSTRIES, INC.
(Exact name of small business issuer as specified in its charter)
California 95-2312900
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8641 United Plaza Blvd., Suite 300, Baton Rouge, LA 70809
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Address of principal executive office) (Zip Code)
(225) 922-4540
(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
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The number of outstanding shares of the issuer's common stock, $0.001 par value
(the only class of voting stock), as of December 4, 2000 was 15,000,000.
1
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TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS..................................................3
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS..................................4
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.....................................................5
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K......................................5
SIGNATURES.....................................................................6
INDEX TO EXHIBITS..............................................................7
[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]
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ITEM 1. FINANCIAL STATEMENTS
As used herein, the term "Company" refers to Erly Industries, Inc., a California
corporation, its consolidated entities, and predecessors unless otherwise
indicated. Unaudited, condensed consolidated interim financial statements
including a balance sheet for the Company as of the quarter ended December 31,
1999 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 December 31, 1999, are attached hereto as Pages F-1
through F-5 and are incorporated herein by this reference.
[THIS SPACE HAS BEEN LEFT BLANK INTENTIONALLY.]
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INDEX TO FINANCIAL STATEMENTS
PAGE
Condensed Consolidated Balance Sheet.........................................F-2
Statements of Unaudited Condensed Consolidated Operations....................F-3
Statements of Unaudited Condensed Consolidated Cash Flows....................F-4
Notes to Unaudited Financial Statements......................................F-5
F-1
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Erly Industries, Inc.
(A Development Stage Company)
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
December 31, 1999
Unaudited
December 31, 1999
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ASSETS
CURRENT ASSETS
Cash $ 0
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Total Current Assets 0
TOTAL ASSETS $ 0
=======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 0
Compensation payable to Officer 0
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Total Current Liabilities 0
TOTAL LIABILITIES 0
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SHAREHOLDERS' EQUITY/ (DEFICIT)
Preferred stock, $100 par value, 6,000 shares
authorized; issued and outstanding -0- shares 0
Common stock, $0.01 par value, 15,000,000 shares
authorized, issued and outstanding 5,762,088 0
Deficit accumulated during the development stage 0
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Total Stockholders' Equity (Deficit) 0
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT) $ 0
========
See Notes To Financial Statements.
F-2
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<TABLE>
Erly Industries, Inc.
(A DEVELOPMENT STAGE COMPANY)
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
From August 21, 1999 (Date of Inception) through December 31, 1999
<CAPTION>
From inception,
Three Months August 21, 1999,
Ended through
December 31, December 31,
1999 1999
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<S> <C> <C>
Sales $ 0 $ 0
General and Administrative 0 0
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Income (Loss) From Operations 0 0
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Other Income (Expense)
Refund of funds previously expended 0 0
Interest income 0 0
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Total Other Income (Expense) 0 0
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Net gain (loss) 0 0
Income taxes 0 0
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Net Income (Loss) $ 0 $ 0
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Income (Loss) per share $ .00 $ .00
Weighted average shares outstanding 5,762,088 5,762,088
============ ============
</TABLE>
See Notes to Financial Statements.
F-3
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<TABLE>
ERLY INDUSTRIES, INC.
(A DEVELOPMENT STAGE COMPANY)
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
From August 21, 1999 (Date of Inception) through December 31, 1999
<CAPTION>
From inception,
For the three August 21, 1999,
months ended through
December 31, December 31,
1999 1999
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<S> <C> <C>
Cash Flows from Operating Activities
Net Gain (Loss) $ 0 $ 0
Adjustments to reconcile net loss to
net cash provided (used in) operating activities:
Increase (decrease) in accounts payable 0 0
Increase (decrease) in other current liabilities 0 0
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Net Cash Provided (Used in) Operating Activities 0 0
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Cash flow from Investing Activities 0 0
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Cash flow from Financing Activities 0 0
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Net Increase (Decrease) in Cash 0 0
Cash at Beginning of Period 0 0
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Cash at End of Period $ 0 $ 0
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Supplemental Disclosures
Interest paid $ 0 $ 0
Income taxes paid 0 0
</TABLE>
See Notes to Financial Statements.
F-4
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ERLY INDUSTRIES, INC.
(A Development Stage Company)
Notes to the Unaudited Consolidated Financial Statements
December 31, 1999
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
condensed financial statements be read in conjunction with the
financial statements and notes thereto included in the form 8-K dated
November 8, 1999.
In accordance with the American Institute of Certified Public
Accountants (AICPA) Statement of Position 90-7, Financial Reporting by
Entities in Reorganization under the Bankruptcy Code, which requires
that assets and liabilities be adjusted to their fair values ("fresh
start values"), the company has valued the assets, liabilities, and
equity to the values determined as a result of the restructuring plan
approved by the Bankruptcy Court on August 20, 1999.
NOTE 2 -INCOME TAXES
The Company is not able to determine its net operating loss (NOL)
carryforwards due to significant tax sharing agreements with its former
subsidiary, American Rice, Inc. Due to the inability of management to
determine the amount of NOL as well as the uncertainty of future
taxable income, management has established the valuation allowance to
be any amount necessary to reduce the tax benefit of any NOL to zero.
Related to the uncertainty associated with NOLs, the possibility exists
that the Company could ultimately be liable for income taxes. Although
management believes that the Company should not have taxable income or
liabilities, the possibility does exist. These financial statements do
not provide for any possible income taxes that could ultimately be owed
by the Company.
NOTE 3 -COMPARABLE PERIODS
Normally, the presentation of financial statements for an interim
period include comparable amounts from the previous year. However,
since the Company emerged from Chapter 11 Bankruptcy on August 20,
1999, as a development stage company, comparable period financial
statements are not presented as they would not represent a valid
comparison.
NOTE 4 -CONSOLIDATED ENTITIES
The presentation of financial statements represents amounts
consolidated from the following subsidiaries many of which have been
defunct for some time:
* Watch-Edge International (WEI, formerly known as Chemonics
Industries, Inc)
* Chemonics International, Inc. 100% owned by WEI
F-5
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* Chemonics Fire-Trol, Inc. 100% owned by WEI
* Chemonics Industries LTD (Canada) 100% owned by WEI
* Transcontinental Distribution Company LTD (South Africa) 100%
owned by WEI
* The Beverage Source (discontinued FY 1990)
* Erly Juice, Inc. (discontinued 1993)
* Worldmark, Inc. 99% owned by ERLY, Inc (discontinued Dec. 1993)
* Eau Claire Packing Co., 100% owned by Worldmark, Inc.
(discontinued Dec. 1993)
F-6
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Plan of Operations
As used herein the term "Company" refers to Erly Industries, Inc., a California
corporation, its consolidated entities, and its predecessors, unless the context
indicates otherwise. The Company emerged from bankruptcy on August 21, 1999. The
Company is currently a shell company whose purpose will be to acquire operations
through an acquisition, merger or begin its own start-up business.
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 ERLY's common stock
to a group of investors. As of the date of this filing that transaction has not
been finalized and therefore the parties involved are undisclosed until the
transaction is consummated and the appropriate Form 8-K is filed. There can be
no assurance offered that ERLY will be successful in developing a viable
business plan and obtaining capital necessary to carry out a business plan or to
continue as a going concern.
The Company has no plans for the purchase or sale of any plant or equipment.
The Company is a development stage company and currently has no employees. The
Company has no current plans to make any changes in the number of employees.
Results of Operations
The Company had no sales revenues for the three months ended December 31, 1999.
The Company had no sales in for the three months ended December 31, 1999 because
it emerged from bankruptcy on August 21, 1999, without operations as a
development stage company.
The Company had no costs of sales revenues for the three months ended December
31, 1999 because it emerged from bankruptcy on August 21, 1999, without
operations as a development stage company.
General and administrative expenses were $0 three months ended December 31,
1999. Since there were no operations during the periods, no expenses were
incurred.
The Company recorded net income of $0 for the three months ended December 31,
1999.
Capital Resources and Liquidity
At December 31, 1999, the Company had current assets of $0 and total assets of
$0. The Company had neither a working capital surplus or deficit as of December
31, 1999.
Net stockholders' equity in the Company was $0 as of December 31, 1999.
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PART II-OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On August 9, 1999, the Bankruptcy Court enclosed in order (the "Confirmation
Order") which confirmed a Chapter 11 Joint Plan of Reorganization as modified by
ERLY and WEI (the "Debtors"). The Confirmation Order provides that all entities
who have held, hold or may hold a claim against the debtors are permanently
enjoined on or after the confirmation date (August 20, 1999) from making demand
on, commencing, or continuing in any manner any action or proceeding of any kind
with respect to any claim against the Debtors.
Since emerging from bankruptcy on August 20, 1999, the Company is not aware of
any legal proceedings that have been brought or may be brought against the
Company.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits Exhibits required to be attached by Item 601 of Regulation S-B
are listed in the Index to Exhibits on page 6 of this Form 10-QSB, and
are incorporated herein by this reference.
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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 4th day of December, 2000.
Erly Industries, Inc.
/s/ Richard Surber
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Richard Surber, Vice President
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INDEX TO EXHIBITS
EXHIBIT PAGE
NO. NO. DESCRIPTION
27 7 Financial Data Schedule "CE"
7
