U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 March 31, 2003
--------------
[ ] Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from __________ to __________
Commission File Number 0-21279
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THERMACELL TECHNOLOGIES, INC.
-----------------------------
(Exact Name of Small Business Issuer as Specified in Its Charter)
FLORIDA 59-3223708
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
901 Chestnut St., Suite A Clearwater, Florida 33756
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(Address of Principal Executive Offices)
(727) 443-7388
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(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 a
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 No X
---- -----
The number of shares outstanding of the Issuer's Common Stock, $.0001
Par Value, as of March 31, 2003 was 1,000,000.
Transitional Small Business Disclosure Format:
Yes __ No X
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THERMACELL TECHNOLOGIES, INC.
Index
Three and Six Months Ended March 31, 2003 and 2002
(Unaudited)
Page
----
Part I - Financial Information
Item 1. Financial Statements
Balance Sheet -
March 31, 2003................................................ 1
Statements of Operations -
Three and six months ended
March 31, 2003 and 2002....................................... 2
Statements of Changes in Stockholders' Deficit
Six months ended March 31, 2003............................... 3
Statements of Cash Flows -
Six months ended
March 31, 2003 and 2002....................................... 4
Notes to Financial Statements................................... 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations........................... 8
Item 3. Controls and Procedures.......................................... 13
Part II - Other Information
Item 1. Legal Proceedings................................................ 14
Item 2. Changes in Securities and Use of Proceeds........................ 14
Item 3. Defaults Upon Senior Securities.................................. 14
Item 4. Submission of Matters to a Vote of Security Holders.............. 14
Item 5. Other Information................................................ 14
Item 6. Exhibits and reports on Form 8-K................................. 14
Signatures............................................................... 15
i
THERMACELL TECHNOLOGIES, INC.
Balance Sheet
March 31, 2003
(Unaudited)
Assets
Cash $ 131
=====================
Liabilities and Stockholders' Deficit
Current liabilities:
Accounts payable 106,704
Accrued payroll taxes 55,251
Shareholder advances 81,425
---------------------
Total current liabilities 243,380
---------------------
Accrued payroll taxes - long-term 140,561
---------------------
Stockholders' deficit:
Common stock; $.0001 par value; 20,000,000 shares authorized;
1,000,000 shares issued and outstanding 100
Additional paid-in capital 12,525,213
Common stock payable 4,165,954
Accumulated deficit (17,075,077)
---------------------
Total stockholders' deficit (383,810)
---------------------
$ 131
=====================
The accompanying notes are an intregral part of the financial statements.
1
THERMACELL TECHNOLOGIES, INC.
Statements of Operations
(Unaudited)
Three Months Ended March 31, Six Months Ended March 31,
---------------------------------- ---------------------------------
2003 2002 2003 2002
------------- -------------- ------------- -------------
Sales $ - $ - $ - $ -
------------- -------------- ------------- -------------
Cost of sales - - - -
------------- -------------- ------------- -------------
Gross profit - - - -
------------- -------------- ------------- -------------
Selling, general and administrative
expenses 21,831 254,542 89,674 501,802
------------- -------------- ------------- -------------
Loss from operations (21,831) (254,542) (89,674) (501,802)
------------- -------------- ------------- -------------
Other expense:
Interest expense - (53,687) - (127,348)
Other expense - - - -
------------- -------------- ------------- -------------
- (53,687) - (127,348)
Net loss $ (21,831) $ (308,229)$ (89,674) $ (629,150)
============= ============== ============= =============
Net loss per share $ (0.02) $ (0.31)$ (0.09) $ (0.63)
============= ============== ============= =============
Weighted average number of
common shares outstanding 1,000,000 1,000,000 1,000,000 997,029
============= ============== ============= =============
The accompanying notes are an intregral part of the financial statements.
2
THERMACELL TECHNOLOGIES, INC.
Statements of Changes in Stockholders' Deficit
(Unaudited)
Six Months Ended March 31, 2003
Common Stock
--------------------------- Additional Common
Number of Paid-in Stock Accumulated
Shares Amount Capital Payable Deficit Total
--------------- ---------- -------------- -------------- --------------- ---------------
Balance, September 30, 2002 1,000,000 $ 100 $ 12,525,213 $ 4,165,954 $ (16,985,403) $ (294,136)
Net loss for the period - - - - (89,674) (89,674)
--------------- ---------- -------------- -------------- --------------- ---------------
Balance, March 31, 2003 1,000,000 $ 100 $ 12,525,213 $ 4,165,954 $ (17,075,077) $ (383,810)
=============== ========== ============== ============== =============== ===============
The accompanying notes are an intregral part of the financial statements.
3
THERMACELL TECHNOLOGIES, INC.
Statements of Cash Flows
(Unaudited)
Six Months Ended March 31,
----------------------------------------
2003 2002
------------------ ------------------
Operating activities
Net loss $ (89,674) $ (629,150)
------------------ ------------------
Adjustments to reconcile net loss to net cash used by operating
activities:
Amortization of discount on notes payable - 54,352
Decrease in:
Prepaid and other assets - 41,325
Increase (decrease) in:
Accounts payable 11,681 (1,684)
Accrued payroll expenses 4,861 232,996
------------------ ------------------
Total adjustments 16,542 326,989
------------------ ------------------
------------------ ------------------
Net cash used by operating activities (73,132) (302,161)
------------------ ------------------
Investing activities
------------------ ------------------
Net cash provided by investing activities - -
------------------ ------------------
Financing activities
Bank overdraft (8,162) 1,814
Proceeds from shareholder advance 81,425 -
Proceeds from issuance of notes payable - 294,250
------------------ ------------------
Net cash provided by financing activities 73,263 296,064
------------------ ------------------
Net decrease in cash 131 (6,097)
Cash at beginning of period - 6,097
------------------ ------------------
Cash at end of period $ 131 $ -
================== ==================
The accompanying notes are an intregral part of the financial statements.
4
THERMACELL TECHNOLOGIES, INC.
Notes to Financial Statements
Three and Six Months Ended March 31, 2003
(Unaudited)
1. Basis of Presentation
In the opinion of management, all adjustments consisting only of normal
recurring adjustments necessary for a fair statement of (a) the results of
operations for the three and six months ended March 31, 2003 and 2002, (b) the
financial position at March 31, 2003, and (c) cash flows for the six months
ended March 31, 2003 and 2002, have been made.
The unaudited financial statements and notes are presented as permitted by Form
10-QSB. Accordingly, certain information and note disclosures normally included
in the financial statements prepared in accordance with accounting principles
generally accepted in the United States of America have been omitted. The
accompanying financial statements and notes of ThermaCell Technologies, Inc.
(the "Company") should be read in conjunction with the audited financial
statements and notes of the Company for the fiscal year ended September 30,
2002. The results of operations for the three and six month periods ended March
31, 2003 are not necessarily indicative of those to be expected for the entire
year.
Certain minor reclassifications have been made to the 2003 financial statements
to conform to the classifications used in 2003.
2. Bankruptcy Filing and Going Concern Considerations
In November 2001, the Company filed a voluntary petition for reorganization
under Chapter 11 of the U. S. Bankruptcy Code with the U.S. Bankruptcy Court. On
August 30, 2002, the United States Bankruptcy Court for the Middle District of
Florida, Tampa Division, Case No. 01-20854-8G1 issued an order confirming
ThermaCell's Plan of Reorganization under Chapter 11 of the Bankruptcy Code,
dated as of February 25, 2002 (the "Plan of Reorganization").
The key elements of the Plan of Reorganization are as follows:
- - The Plan of Reorganization provides for the issuance or reservation for
future issuance of ten million (10,000,000) new shares of ThermaCell Common
Stock in the aggregate. Previously issued shares of ThermaCell common stock
will be cancelled and replaced by the new shares authorized under the Plan
of Reorganization.
- - Pac Funding, LLC, a Florida limited liability company ("Pac"), whose
members are Augustine Capital Funding, L.P. and Private Capital Group is
entitled to 5,000,000 new common shares pursuant to the Plan of
Reorganization. Pac was the debtor-in-possession funding source and
supplied funds necessary to operate the business while it was a
debtor-in-possession and avoid liquidation.
- - General unsecured creditors and unsecured claims pursuant to the Plan of
Reorganization are entitled to 4,000,000 new ThermaCell common shares.
5
THERMACELL TECHNOLOGIES, INC.
Notes to Financial Statements
Three and Six Months Ended March 31, 2003
(Unaudited)
2. Bankruptcy Filing and Going Concern Considerations(continued)
- - The existing shareholders of ThermaCell are entitled to 1,000,000 new
common shares pursuant to the Plan of Reorganization. As of August 30,
2002, there were approximately 13,000,000 shares of ThermaCell common stock
outstanding. Thus, pursuant to the Plan of Reorganization and action by the
board of directors, existing ThermaCell common stockholders would be
entitled to one (1) new ThermaCell common share for every 13.034 ThermaCell
common shares previously held, subject to adjustment for the actual number
of shares outstanding as of August 30, 2002, pursuant to records maintained
by the transfer agent and ThermaCell.
- - The existing assets and business of ThermaCell are transferred to a newly
formed subsidiary free and clear of any and all debts, claims, liens,
demands and interest of creditors, equity security holders and parties and
interests, except as provided forth in the Plan of Reorganization.
Accordingly, ThermaCell will be a holding company and the existing assets
of its business relating to the manufacturing and production of evacuated
microspheres technology will be held in a new subsidiary. As of March 31,
2003, this transaction has not been completed.
- - All debts, claims or demands that arose before the date of the Plan of
Reorganization's confirmation, are discharged, except for priority tax
claims and certain administrative claims. Priority tax claims are paid over
a six (6) year period from the date of assessment. The IRS has made a claim
for approximately $120,000. In addition, ThermaCell is obligated for
administrative claims payable to the government, lawyers and accountants,
estimated at approximately $100,000.
Although the Plan became effective on August 30, 2002 and the Company commenced
implementation of the Plan on that date, distributions of common stock to its
pre-bankruptcy creditors have not been completed. As noted above the Company is
going to issue 9,000,000 shares in accordance with the Plan of Reorganization.
These shares are valued at the original cost of the forgiven liabilities and
recorded as a common stock payable.
The accompanying financial statements have been prepared on a going concern
basis that contemplates the realization of assets and liabilities. In the
ordinary course of business, operating losses have been incurred each year since
inception, resulting in an accumulated deficit of approximately $17,075,000 and
negative working capital of approximately $243,250 as of March 31, 2003, and
total liabilities exceeding total assets by approximately $384,000 as of March
31, 2003. Currently, management is soliciting additional equity investors to
fund these deficits. However, these conditions raise substantial doubt about the
Company's ability to continue as a going concern. The financial statements of
the Company do not include any adjustments relating to the recoverability of
liabilities that might be necessary should the Company be unable to continue as
a going concern.
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THERMACELL TECHNOLOGIES, INC.
Notes to Financial Statements
Three and Six Months Ended March 31, 2003
(Unaudited)
3. Per Share Calculations
Per share data was computed by dividing net loss by the weighted average number
of shares outstanding during the three and six month periods ended March 31,
2003 and 2002. The weighted average shares outstanding for the three month
periods ended March 31, 2002 and 2003 was 1,000,000. The weighted average shares
outstanding for the six month period ended March 31, 2002 was 997,029 as
compared to 1,000,000 for the six month period ended March 31, 2003.
4. Shareholder Advances
During the six-month period ended March 31, 2003, PAC Funding, LLC. advanced
$81,425 to the Company to cover operating expenses. This advance is unsecured
and has no specific repayment terms.
The above transaction is not necessarily indicative of a transaction that would
have been entered into had a comparable transaction been entered into with
independent parties.
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THERMACELL TECHNOLOGIES, INC.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The statements contained in this Report on Form 10-QSB, that are not purely
historical, are forward-looking information and statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These include statements regarding the Company's
expectations, intentions, or strategies regarding future matters. All
forward-looking statements included in this document are based on information
available to the Company on the date hereof. It is important to note that the
Company's actual results could differ materially from those projected in such
forward-looking statements contained in this Form 10-QSB. The forward-looking
statements contained here in are based on current expectations that involve
numerous risks and uncertainties. Assumptions relating to the foregoing involve
judgments regarding, among other things, the Company's ability to secure
financing or investment for capital expenditures, future economic and
competitive market conditions, and future business decisions. All these matters
are difficult or impossible to predict accurately and many of which may be
beyond the control of the Company. Although the Company believes that the
assumptions underlying its forward-looking statements are reasonable, any of the
assumptions could be inaccurate and, therefore, there can be no assurance that
the forward-looking statements included in this form 10-QSB will prove to be
accurate.
GENERAL
The Company has operated as a debtor-in-possession under Chapter 11 of the
United States Code (the "Bankruptcy Code") since November 2001. In November
2001, the Company filed a voluntary petition for reorganization under Chapter 11
of the U. S. Bankruptcy Code with the U.S. Bankruptcy Court. On August 30, 2002,
the United States Bankruptcy Court for the Middle District of Florida, Tampa
Division, Case No. 01-20854-8G1 issued an order confirming ThermaCell's Plan of
Reorganization under Chapter 11 of the Bankruptcy Code, dated as of February 25,
2002 (the "Plan of Reorganization"). Although the Plan became effective on
August 30, 2002 and the Company commenced implementation of the Plan on that
date, distributions of common stock to its pre-bankruptcy creditors have not
been completed.
OVERVIEW
We were incorporated in Florida in August 1993, for the purpose of developing,
manufacturing, and marketing insulating materials and coatings using partially
evacuated glass microspheres (sometimes referred to as "shells"). The process of
evacuation removes air and other gases from the sphere and thereby creates a
vacuum. A shell is a very small glass sphere (generally the size of a grain of
salt) made by crushing glass particles. The insertion of shells into various
materials and products ("shell technology") can substantially improve the
thermal resistive characteristics of such materials and products resulting in
improved insulation ("R") values. The more a shell is evacuated, the higher the
thermal resistive characteristics of the product or material to which the shells
are added. Shells can also be used as filler material for products such as
bowling balls.
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THERMACELL TECHNOLOGIES, INC.
Our management's long-term business strategy is to (i) develop and manufacture
our own shells and (ii) use our shell technology to improve the "R" values in a
number of applications that create new and improved products. These products may
include, but are not limited to, paints and coatings, drywall, gypsum board,
home siding materials and space foam insulation. Other markets in which we may
utilize our technology include refrigeration and cooling systems, automotive and
transportation applications, cups and thermoses. There is no assurance that we
will be successful in penetrating these markets and developing commercially
viable manufacturing techniques for our shell technology. In our 1995 fiscal
year, we completed the development of our first product line that consisted of
paints and coatings containing shells in order to reduce heat transmission and
improve the insulation values of these products. The products were marketed
under the ThermaCool(TM) label. There have been limited sales of this product
since its introduction due to our financial limitations.
BUSINESS STRATEGY
Our business strategy is to develop and commercialize shell technology and
products incorporating shell technology. An important element in our past
strategy was to acquire paint manufacturers and distributors to introduce our
technology into the paint and coating industry. That strategy has been abandoned
because of our financial condition. One of our current objectives will re-start
our marketing of microspheres incorporating our shell technology. Our
restructuring strategy of developing a commercially viable manufacturing process
for shells and expansion into markets for our shell technology will result in
incurring additional losses due to the costs associated with these strategies.
We expect to incur losses until we are able produce shells consistently on a
production-wide basis and are able to market these shells to generate revenues.
The Company's business strategy is dependent upon the successful implementation
of the following:
(i) Develop and manufacture the Company's own shells
The Company's manufacturing process allows for the production
of insulating shells in a manner to enable the evacuation of gases or the
addition of low conductive gas into the shells. Such evacuation results in lower
gas pressure or gases within the shells that can reduce thermal conductivity,
thus providing improved insulating qualities. The manufacturing process involves
the formation of water vapor in the shells and then the subsequent evacuation of
the shells by heating the shells. This process causes out-permeation of the
water vapor.
To the best of management's knowledge, no one has been able to
develop a commercially viable process for the production of fully evacuated
glass shells, due to, among other factors, manufacturing and technical
restraints. Currently, there are three large multinational companies that
manufacture shells. The essential difference between the manufacturing process
for partially evacuated shells, as compared to substantially or fully evacuated
shells, is the technique employed to evacuate gases from the shells which
improve its thermal conductivity or insulating value. Our plans to market
9
THERMACELL TECHNOLOGIES, INC.
non-evacuated shells for several uses will compete directly with others in this
market. We plan to have non-evacuated shells available to sell in the general
market because not all shells during the manufacturing process will be
evacuated. These non-evacuated shells will be separated and sold for general use
as fillers, but will be produced at a substantially reduced cost.
Our present expertise and equipment can be used to manufacture
partially evacuated shells. To-date we have manufactured pilot plant quantities
of shells but have not produced commercial quantities.
(ii) Expand the shell technology to other products
We believe the potential exists to commercially exploit other
markets suitable for our shell technologies. These include filler materials for
bowling balls, aroma therapy applications and construction components such as
drywall, gypsum board, prefabricated cement products, home siding materials and
space foam insulation as potential markets. Other potential markets include
refrigeration and cooling systems, automotive and transportation applications,
and cups and thermoses. There is no assurance that we will be able to attract
capital to manufacture our products or successfully penetrate any of these
markets. We will only be able to implement this strategy if we are able to
economically manufacture highly or partially evacuated shells.
RESULTS OF OPERATIONS
FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 2003 COMPARED TO THE THREE-MONTH
PERIOD ENDED MARCH 31, 2002
Sales
- -----
There were no sales for the three-month periods ended March 31, 2003 and 2002.
We produced limited quantities of microspheres and have not generated any
revenues from these products during the periods ended March 31, 2003 and 2002.
There are no assurances that we will be able to generate significant revenues
from these products or products incorporating this technology in the future.
Selling, General and Administrative Expenses
- --------------------------------------------
For the three-month period ended March 31, 2003, total selling, general, and
administrative expenses were $21,831 as compared to $254,542 for the three-month
period ended March 31, 2002, a decrease of $232,711 or 91%. This decrease is
related primarily to a reduction in payroll expenses, insurance costs,
consulting expenses, legal fees, and rent experienced during the current period.
Interest Expense
- ----------------
Interest expense, net of interest income, decreased 100%, or $53,687 to $0 for
the three-month period ended March 31, 2003 from $53,687 in the previous
three-month period ended March 31, 2002. Interest expense primarily related to
our outstanding convertible debentures, which were converted to common stock
payable as pursuant to the confirmation of the Plan of Reorganization. These
shares of common stock have not been issued as of March 31, 2003.
10
THERMACELL TECHNOLOGIES, INC.
Net Loss
- --------
The net loss and the net loss per share was $21,831 and $0.02, respectively, for
the three-month period ended March 31, 2003, as compared to a net loss and net
loss per share of $308,229 and $0.31, respectively, for the three-month period
ending March 31, 2002. This decrease is primarily related to a reduction in
selling, general and administrative and interest expense during the current
period. On a weighted average basis, there were 1,000,000 shares outstanding for
three-month period ending March 31, 2003 and 2002.
FOR THE SIX-MONTH PERIOD ENDED MARCH 31, 2003 COMPARED TO THE SIX-MONTH PERIOD
ENDED MARCH 31, 2002
Sales
- -----
There were no sales for the six-month periods ended March 31, 2003 and 2002. We
produced limited quantities of microspheres and have not generated any revenues
from these products during the periods ended March 31, 2003 and 2002. There are
no assurances that we will be able to generate significant revenues from these
products or products incorporating this technology in the future.
Selling, General and Administrative Expenses
- --------------------------------------------
For the six-month period ended March 31, 2003, total selling, general, and
administrative expenses were $89,674 as compared to $501,802 for the six-month
period ended March 31, 2002, a decrease of $412,128 or 82%. This decrease is
related primarily to a reduction in payroll expenses, insurance costs,
consulting expenses, legal fees, and rent experienced during the current period.
Interest Expense
- ----------------
Interest expense, net of interest income, decreased 100%, or $127,348 to $0 for
the six-month period ended March 31, 2003 from $127,348 in the previous
six-month period ended March 31, 2002. Interest expense primarily related to our
outstanding convertible debentures, which were converted to common stock payable
as pursuant to the confirmation of the Plan of Reorganization. These shares of
common stock have not been issued as of March 31, 2003.
Net Loss
- --------
The net loss and the net loss per share was $89,674 and $0.09, respectively, for
the six-month period ended March 31, 2003, as compared to a net loss and net
loss per share of $629,150 and $0.63, respectively, for the six-month period
ending March 31, 2002. This decrease is primarily related to a reduction in
selling, general and administrative and interest expense during the current
period. On a weighted average basis, there were 1,000,000 shares outstanding for
six-month period ending March 31, 2003 as compared to 997,029 shares outstanding
for six-month period ended March 31, 2002.
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THERMACELL TECHNOLOGIES, INC.
LIQUIDITY AND CAPITAL RESOURCES
To date, we have funded our capital requirements and business operations,
including product development activities with funds provided by the sale of our
securities and from borrowings. During the six month period ended March 31,
2003, Pac Funding advanced us $81,425 to cover operating expenses.
We continue to experience operating losses. Our net working capital deficiency
and stockholders' deficit are $243,250 and $383,810 at March 31, 2003. We have
not historically generated sufficient revenues from operations to self-fund our
capital requirements. Management is focusing on raising additional capital to
fund its present development. We do not have sufficient working capital to meet
our immediate needs.
Historically, our business has not generated sufficient cash flow from
operations and we are uncertain that future capital will be available to us to
enable us to fund our business and capital expenditure needs. Even though the
Plan of Reorganization is confirmed, ThermaCell will be dependent upon continued
funding through Pac Funding. There is no assurance that Pac Funding will
continue funding ThermaCell. Although management of ThermaCell is optimistic
that it will be able to generate revenues in the near future, there is no
assurance that such revenues will be substantial or allow us to continue our
existence.
We will not be able to meet our future cash requirements unless new financing is
obtained. Moreover, we will require substantial capital to execute our Plan of
Reorganization to remain a going concern. We will need short term outside
investments on a continuing basis to finance our current operations. Our
revenues for the foreseeable future may not be sufficient to attain
profitability. We expect to continue to experience losses in the near future. If
we do not obtain short-term financing, we may not be able to continue as a going
concern. We do not have a bank line of credit and there can be no assurance that
any required or desired financing will be available through bank borrowings,
debt, or equity offerings, or otherwise, on acceptable terms. If future
financing requirements are satisfied through the issuance of equity securities,
investors may experience significant dilution in the net book value per share of
common stock and there is no guarantee that a market will exist for the sale of
the Company's shares.
Critical Accounting Policies
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
The estimated fair value of the Company's liabilities approximated their
carrying value at the period end.
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THERMACELL TECHNOLOGIES, INC.
The Company issues stock in lieu of cash for certain transactions. The fair
value of the stock, which is based on comparable cash purchases or the value of
services, whichever is more readily determinable, is used to value the
transaction.
The Company records the receipt of payment for common stock that has not been
issued to the stockholder as a common stock payable in the financial statements.
Inflation
Inflation has not proven to be a factor in our business since our inception and
is not expected to have a material impact on our business in the foreseeable
future.
Going Concern Assumption
Our losses and other factors resulted in most of our available cash resources
being used to support operating activities. In addition, the Company has assumed
significant commitments and obligations as described in the financial
statements. These factors, among others, raise substantial doubt about the
Company's ability to continue as a going concern.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
Management has taken certain steps to revise the operating and financial
requirements of the Company, which it believes are sufficient to provide the
Company with the ability to continue in existence. Management believes that the
Chapter 11 filing has allowed the Company to reorganize and rethink its
direction, and to attract additional financing to sustain its business during
this fiscal year.
13
THERMACELL TECHNOLOGIES, INC.
Item 3. Controls and Procedures
Within 90 days prior to the date of filing of this report, we carried out an
evaluation, under the supervision and with the participation of our Chief
Executive Officer, of the design and operation of our disclosure controls and
procedures. Based on this evaluation, our Chief Executive Officer concluded that
our disclosure controls and procedures are effective for gathering, analyzing
and disclosing the information that we are required to disclose in the reports
we file under the Securities Exchange Act of 1934 within the time periods
specified in the SEC's rules and forms. Our Chief Executive Officer also
concluded that our disclosure controls and procedures are effective in timely
alerting them to material information relating to our company required to be
included in our periodic SEC filings. In connection with the new rules, we are
in the process of further reviewing and documenting our disclosure controls and
procedures, including our internal controls and procedures for financial
reporting, and may from time to time make changes designed to enhance their
effectiveness and to ensure that our systems evolve with our business. There
have been no significant changes in our internal controls or in other factors
that could significantly affect internal controls subsequent to the date of this
evaluation.
14
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
In November 2001, we filed a voluntary petition for relief under Chapter 11 of
the United States Bankruptcy Code in the United States Bankruptcy Court for the
Middle District of Florida in Tampa, Florida. Since November 2001, we had
arranged for debtor-in-possession financing with our largest shareholder. Our
plan of reorganization was approved on August 30, 2002, which requests creditors
to accept our shares and to have the debtor-in-possession funding source also
accept our shares as part of this reorganization. Management believes that the
shell technology is viable and that there are substantial markets for its
products. The organization proceedings will help ThermaCell achieve its
objectives and retain some shareholder value.
Item 2. Changes in Securities and Use of Proceeds
None
Item 3. Defaults Upon Senior Securities.
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and reports on Form 8-K
(a) Exhibits
99.1 Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by
ThermaCell Technologies' Chief Executive Officer.
(b) Reports of Form 8-K -none
15
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the Registrant had
duly caused the report to be signed on its behalf by the undersigned thereunto
duly authorized.
ThermaCell Technologies, Inc.
Dated 6/11/2003
/s/ Steven Hinsley
--------------------
Steven Hinsley
President