10QSB 1 p0509-10qsb.txt FORM 10-QSB FOR QUARTER ENDED MARCH 31, 2004 UNITED STATES 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 - March 31, 2004 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission file number 0-31047 RIM HOLDINGS INC. ---------------------------------------------- (Name of small business issuer in its charter) Nevada 86-0995730 ------------------------------- ------------------------------------ (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 7579 E. Main, Suite 600, Scottsdale, AZ 85251 --------------------------------------------------------------- ---------- (Address of Principal executive offices) (as of date of filing) (Zip Code) Issuer's telephone number (480) 970-3336 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 such filing requirements for the past 90 days. Yes [X] No [ ] APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by court. Yes [ ] No [ ] APPLICABLE ONLY TO CORPORATE ISSUERS State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: at May 11, 2004 - 18,740,967 Transitional Small Business Disclosure Format (check one): Yes [ ] No [X] RIM HOLDINGS INC. FORM 10-QSB FOR THE QUARTERLY PERIOD ENDED March 31, 2004 Page ---- Item 1. Financial Statements.............................................. 3 Unaudited Financial Statements: Balance Sheet........................................................ 3 Statement of Operations.............................................. 5 Statement of Changes in Stockholders' Equity (Deficit)............... 6 Statement of Cash Flows.............................................. 7 Notes to Financial Statements........................................ 9 Item 2. Management's Discussion and Analysis or Plan of Operation......... 12 Item 3. Controls and Procedures........................................... 14 PART II Item 1. Legal Proceedings................................................. 15 Item 2. Changes in Securities............................................. 15 Item 3. Defaults Upon Senior Securities................................... N/A Item 4. Submission of Matters to a Vote of Security Holders............... N/A Item 5. Other Information................................................. N/A Item 6. Exhibits and Reports on Form 8-K.................................. 15 SIGNATURE................................................................. 16 2 PART I ITEM 1. FINANCIAL STATEMENTS RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED CONSOLIDATED BALANCE SHEET AS OF MARCH 31, 2004 AND SEPTEMBER 30, 2003 ASSETS March 31, September 30, 2004 2003 ------------ ------------- CURRENT ASSETS Cash and Cash Equivalents $ -- $ -- Accounts Receivable-Trade, Net allowance for doubtful accounts of $913 as of September 30, 2003 2,956 41,824 Prepaid Expenses 27,651 -- Other Current Assets -- 963 ------------ ------------- TOTAL CURRENT ASSETS 30,607 42,787 Property and Equipment-Net 11,370 17,459 OTHER ASSETS License 8,999 9,333 Deposits 1,277 1,277 Cash Surrender Value of Life Insurance 596 1,442 ------------ ------------- $ 52,849 $ 72,298 ============ ============= THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 3 RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED CONSOLIDATED BALANCE SHEET AS OF MARCH 31, 2004 AND SEPTEMBER 30, 2003 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) March 31, September 30, 2004 2003 ------------ ------------- CURRENT LIABILITIES Current Portion of Note Payables $ 1,491 $ 3,990 Current Portion of Capital Leases Obligations -- 2,386 Note Payables - Related Party 8,437 2,473 Bank Line of Credit 72,399 72,399 Accounts Payable -Trade 78,274 81,665 -Other 77,083 175,751 Cash Overdraft 12,433 4,560 Accrued Expenses 56,321 118,937 Deferred Revenues 18,774 27,016 ------------ ------------- TOTAL CURRENT LIABILITIES $ 325,212 $ 489,177 STOCKHOLDERS' EQUITY (DEFICIT) Preferred Stock, 10,000,000 shares authorized; no shares issued or outstanding Common Stock, .001 par value 20,000,000 shares authorized; 18,740,967 and 8,820,873 issued and outstanding at March 31, 2004 and September 30, 2003, respectively 18,741 8,821 Additional Paid In Capital 799,907 531,901 Accumulated Deficit (1,091,011) (957,601) ------------ ------------- TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (272,363) (416,879) ------------ ------------- $ 52,849 $ 72,298 ============ ============= THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 4 RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS SIX AND THREE MONTHS ENDED, MARCH 31, 2004 AND 2003
Six Months Ended March 31, Three Months Ended March 31, 2004 2003 2004 2003 ---------- ---------- ---------- ---------- REVENUE Service $ 106,808 $ 230,303 $ 56,543 $ 99,623 Products 52,176 149,883 3,836 86,263 ---------- ---------- ---------- ---------- 158,984 380,186 60,379 185,886 ---------- ---------- ---------- ---------- COST OF SALES Service 53,941 122,911 30,825 55,742 Products 52,906 110,481 3,905 62,959 ---------- ---------- ---------- ---------- 106,847 233,392 34,730 118,701 ---------- ---------- ---------- ---------- GROSS PROFIT $ 52,137 $ 146,794 $ 25,649 $ 67,185 General and Administrative Expenses 177,429 171,276 99,472 88,642 ---------- ---------- ---------- ---------- LOSS FROM OPERATIONS $ (125,292) $ (24,482) $ (73,823) $ (21,457) OTHER INCOME (EXPENSE) Interest Income -- 24 -- -- Interest Expense (8,118) (15,775) (5,125) (9,526) Other Income -- 2,387 -- -- ---------- ---------- ---------- ---------- (8,118) (13,364) (5,125) (9,526) ---------- ---------- ---------- ---------- NET LOSS $ (133,410) $ (37,846) $ (78,948) $ (30,983) ========== ========== ========== ========== BASIC LOSS PER SHARE $ (0.01) $ (0.00) $ (0.01) $ (0.00) ========== ========== ========== ========== WEIGHTED AVERAGE SHARES OUTSTANDING 10,752,269 8,301,428 12,571,334 8,301,428 ========== ========== ========== ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 5 RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) FOR THE SIX MONTHS ENDED, MARCH 31, 2004
Common Stock Additional Retained Stockholders' ------------------------- Paid-In Earnings Equity Shares Amount Capital (Deficit) (Deficit) ---------- ------------ ------------ ------------ ------------- Balance at September 30, 2002 8,097,933 $ 7,718 $ 499,337 $ (925,229) $ (418,174) Stock Issued for Offering Costs 10,000 10 (10) Issuance of Common Stock for Services 312,940 693 14,954 15,647 Issuance of Common Stock for Cash 200,000 200 9,800 10,000 Common Stock Issued for Licensing Agreement 200,000 200 9,800 10,000 Offering Costs (1,980) (1,980) Net Loss for the Year Ended, September 30, 2003 (32,372) (32,372) ---------- ------------ ------------ ------------ ------------- Balance at September 30, 2003 8,820,873 $ 8,821 $ 531,901 $ (957,601) $ (416,879) ---------- ------------ ------------ ------------ ------------- Issuance of Common Stock for Services 5,920,094 5,920 192,006 197,926 Issuance of Common Stock for Salaries 4,000,000 4,000 76,000 80,000 Net Loss for the Six Months Ended, March 31, 2004 (133,410) (133,410) ---------- ------------ ------------ ------------ ------------- Balance at March 31, 2004 18,740,967 $ 18,741 $ 799,907 $ (1,091,011) $ (272,363) ========== ============ ============ ============ =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 6 RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED, MARCH 31, 2004 AND 2003 For the Three Months Ended March 31, 2004 2003 ------------ ------------ CASH FLOWS FROM OPERATING ACTIVITIES Net Income (Loss) $ (78,948) $ (30,983) Adjustment to Reconcile Net Income to Net Cash Provided By Operating Activities: Depreciation/Amortization 167 7,740 Stock and Options Issued for Services 177,926 10,000 Stock Issued for Wages 80,000 -- Changes in Operating Assets and Liabilities: Accounts Receivable - Trade 16,537 (1,294) Prepaid Expenses (27,651) -- Other Current Assets 963 1,059 Other Assets (69) -- Accounts Payable - Trade (5) 9,370 Accounts Payable - Other (105,308) (492) Accrued Expenses (72,282) (1,516) Deferred Revenue (6,959) (3,221) ------------ ------------ NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES $ (15,629) $ (9,337) ------------ ------------ CASH FLOWS FROM INVESTING ACTIVITIES Purchase of Fixed Assets (544) -- Collection of Related Party Note Receivable -- -- ------------ ------------ NET CASH PROVIDED BY INVESTING ACTIVITIES $ (544) $ -- ------------ ------------ CASH FLOWS FROM FINANCING ACTIVITIES Proceeds From Note Payables-Related Party $ 1,843 $ -- Repayment of Bank Line of Credit -- (100) Repayment on Capital Lease Obligations -- (2,830) Repayment of Debt (999) (1,181) Proceeds From Debt -- -- ------------ ------------ NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES $ 844 $ (4,111) ------------ ------------ NET INCREASE (DECREASE) IN CASH $ (15,329) $ (13,448) CASH AT BEGINNING OF YEAR 2,896 939 ------------ ------------ CASH AS OF MARCH 31, 2004 and 2003 $ (12,433) $ (12,509) ============ ============ Supplementary Cash Flow Information: Cash paid during the period for interest $ 5,125 $ 9,526 ============ ============ THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 7 RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED, MARCH 31, 2004 AND 2003 For the Six Months Ended March 31, 2004 2003 ------------ ------------ CASH FLOWS FROM OPERATING ACTIVITIES Net Income (Loss) $ (133,410) $ (37,846) Adjustment to Reconcile Net Income to Net Cash Provided By Operating Activities: Depreciation/Amortization 6,967 15,071 Stock and Options Issued for Services 197,926 15,647 Stock Issued for Wages 80,000 -- Changes in Operating Assets and Liabilities: Accounts Receivable - Trade 38,868 7,895 Prepaid Expenses (27,651) -- Other Current Assets 963 -- Other Assets 846 -- Accounts Payable - Trade (3,391) (927) Accounts Payable - Other (98,668) 5,171 Accrued Expenses (62,616) (1,519) Deferred Revenue (8,242) (3,217) ------------ ------------ NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES $ (8,408) $ 275 ------------ ------------ CASH FLOWS FROM INVESTING ACTIVITIES Collection of Related Party Note Receivable $ -- $ 1,202 Purchase of Fixed Assets (544) (8,198) ------------ ------------ NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES $ (544) $ (6,996) ------------ ------------ CASH FLOWS FROM FINANCING ACTIVITIES Repayment of Bank Line of Credit $ -- $ (100) Proceeds From Note Payables-Related Party 5,964 -- Repayment on Capital Lease Obligations (2,386) (5,759) Repayment of Debt (2,499) (618) Proceeds From Capital Lease Obligations -- 8,198 ------------ ------------ NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES 1,079 1,721 ------------ ------------ NET INCREASE (DECREASE) IN CASH $ (7,873) $ (5,000) CASH AT BEGINNING OF YEAR (4,560) (7,509) ------------ ------------ CASH AS OF MARCH 31, 2004 AND 2003 $ (12,433) $ (12,509) ============ ============ Supplementary Cash Flow Information: Cash paid during the period for interest $ 8,118 $ 15,775 ============ ============ THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS 8 RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2004 1. SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION: The accompanying financial statements have been prepared by the Company, without audit, and reflect all adjustments that are, in the opinion of management, necessary for a fair statement of the results for the interim periods. The statements have been prepared in accordance with generally accepted accounting principles for interim financial reporting and Securities and Exchange Commission regulations. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the financial statements reflect all adjustments (of a normal and recurring nature) which are necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods. The results of operations for the three months ended March 31, 2004 are not necessarily indicative of the results to be expected for the entire fiscal year. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company's annual report on Form 10K-SB for the fiscal year ended September 30, 2003. PRINCIPLES OF CONSOLIDATION: The consolidated financial statements include the financial position, results of operations, and cash flows of Rim.Com Inc. and its wholly-owned subsidiary, Rimmer Computer, Inc. All material intercompany transactions, accounts and balances have been eliminated in consolidation. NET LOSS PER SHARE: Basic net loss per common share is computed based on weighted average shares outstanding and excludes any potential dilution from stock options, warrants or other common stock equivalents. Basic net loss per share is computed by dividing loss available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted net loss per common share reflects potential dilution from the exercise or conversion of securities into common stock or from other contracts to issue common stock. Diluted earnings per share are not presented, as their effect is antidilutive. 9 RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2004 1. SIGNIFICANT ACCOUNTING POLICIES(CONTINUED) USE OF ESTIMATES: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities at the date the financial statements, and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. STOCK BASED COMPENSATION: The Company has adopted FAS No. 123, "Accounting for Stock-Based Compensation." Under FAS No. 123, companies can, but are not required to, elect to recognize compensation expense for all stock-based awards using a fair value methodology. The Company has adopted the disclosure-only provisions, as permitted by FAS No. 123. The Company applies APB Opinion No. 25 and related interpretations in accounting for its stock-based plans. Accordingly, there is no related compensation expense recorded in the Company's financial statements for the periods presented. Had compensation cost for stock-based compensation been determined based on the fair value of the options at the grant dates consistent with the method of SFAS 123, the Company's net loss and loss per share for the three months ended March 31, 2004 and 2003 would have been reduced to the pro forma amounts presented below: Three Months Ended March 31, ---------------------------- 2004 2003 ------------ ------------ Net Loss: $ (78,948) $ (30,983) As Reported Add: Stock-based employee compensations expense included in reported net income, net of related tax effects $ -- $ -- Deduct: Total stock based employee Compensation expense determined Under fair value based method for all awards, net of related tax effects $ -- $ -- ------------ ------------ Proforma net loss $ (78,948) $ (30,983) ============ ============ Less per share: As reported $ (0.00) $ (0.00) Proforma $ (0.00) $ (0.00) 10 RIM HOLDINGS, INC. AND SUBSIDIARY UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2004 2. ISSUANCES OF NEW SHARES FOR SERVICES During the quarter ended March 31, 2004, the Company issued 5,697,872 shares of common stock to employees and consultants for services and 4,000,000 shares of common stock for salaries. The shares were valued at $257,926. 3. GOING CONCERN The Company's financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has a stockholders' deficit at March 31, 2004, in the amount of $(272,363) and negative working capital in the amount of $(294,605). The Company has also generated losses from operations in the prior years. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. 11 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The statements contained in this document which are not historical are forward-looking statements that are made under the "Safe Harbor" provisions of the Private Securities Reform Act of 1995, and, as such, are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including, but not limited to, the Company's ability to market its products and services and future customer acceptance for its products and services, and other risks detailed in this document and other documents made available to investors. RESULTS OF OPERATION QUARTER ENDING MARCH 31, 2004 During the quarter ended March 31, 2004 the Company produced a net loss of $78,948 on revenues of $60,379, as compared to net loss of $30,983 on revenues of $185,886 for the same quarter of the prior year. The Company's revenues in the quarter ended March 31, 2004 were $125,507 (67.5%) lower than the same quarter of the preceding year, primarily as a result of decreased marketing activity. The Company is hopeful, without assurance, that it will be able to generate more revenues in future quarters. The Company's gross profit in the quarter ended March 31, 2004 decreased by $41,536 (61.8%) over the same quarter of the prior year. The Company's gross profit on its service revenues decreased by $18,163 (41.4%) over the same quarter of the prior year. The Company's gross profit on its products revenues decreased by $23,373 (100.3%) over the same quarter of the prior year. The Company's gross margin on its service revenues was 45.5% and on its product revenues was negative 1.8% during the quarter ended March 31, 2004. The Company hopes to increase its gross margins on its future revenues by increasing its productivity through remote repair technology. The Company's general and administrative expense increased by $10,830 (12.2%) during the quarter ended March 31, 2004 in comparison to the same quarter of the prior year. This cost increase resulted primarily from two new consulting contracts during the quarter. The Company is hopeful of reducing its overhead in the next quarter. Interest expense decreased by $4,401 (46.2%) during the quarter ended March 31, 2004 over the same quarter of the prior year, as a result of decreased capital lease obligations and notes payable. The Company is hopeful this debt can be reduced substantially in the coming year from internally generated cash flow and additional funding sources. The Company is also hoping to consolidate this credit card debt into a debt with a lower interest rate. SIX-MONTH PERIOD ENDING MARCH 31, 2004 During the six-month period ended March 31, 2004 the Company produced a net loss of $133,410 on revenues of $158,984, as compared to a net loss of $37,846 on revenues of $380,186 for the same period of the prior year. The Company's revenues in the six-month period ended March 31, 2004 were $221,196 (58.2%) lower than the same period of the preceding year as a result of decreased marketing activity. The Company is hopeful that it will be able to generate greater revenues in the future. 12 The Company's gross profit in the six-month period ended March 31, 2004 decreased by $94,657 (64.5%) over the same period of the prior year. The Company's gross profit on its service revenues decreased by $54,525 (50.8%) and the gross profit on its products revenues decreased by $40,132 (101.9%) over the same period of the prior year. The Company's gross margin on its service revenues was 49.5% and on its product revenues was negative 1.4% during the six-month period ended March 31, 2004. The Company hopes to increase its gross margins on its future revenues by increasing its productivity through remote repair technology. The Company's general and administrative expense increased by $6,153 (3.6%) during the six-month period ended March 31, 2004 in comparison to the same period of the prior year. This cost increase resulted primarily from two new consulting contracts during the second quarter. The Company is hopeful of reducing its overhead in the next quarter. Interest expense decreased by $7,657 (48.5%) during the six-month period ended March 31, 2004 over the same period of the prior year, as a result of decreased capital lease obligations and notes payable. The Company is hopeful this debt can be reduced substantially in the coming year from internally generated cash flow and additional funding sources. The Company is also hoping to consolidate this credit card debt into a debt with a lower interest rate. LIQUIDITY AND CAPITAL RESOURCES On March 8, 2004 the Company executed a letter of intent and on April 3, 2004 it executed a definitive agreement with Eurofaith Holdings, Inc. and Starway Management Ltd., which provides for the following, among other things: (i) the Company to be recapitalized by means of a 1-for-20 reverse stock split; (ii) the Company to issue approximately 27,408,966 post-split restricted common stock shares to the shareholders of Eurofaith Holdings in exchange for all of the outstanding capital stock of Starway Management; (iii) Starway Management will pay $225,000 to the Company for payment of some of its debts; and (iv) Christina M. Strauch, the Company's Chairman, will transfer 1,200,000 pre-split shares to the Company in exchange for all of the outstanding capital stock of Rimmer Computer, Inc., the Company's wholly-owned subsidiary (collectively, the "Transaction"). See Form 8-K filed by the Company on March 23, 2004. Starway Management Limited generated over $31 Million U.S. in revenues and over $8.9 Million U.S. in net income during its 2003 fiscal year. The parties to the Transaction are presently conducting their due diligence investigations, and there is no assurance when, if ever, the Transaction will be completed. If the Transaction is not completed, in the coming months the Company hopes to secure additional equity financing to further reduce its debt and to finance growth through acquisitions. There is no assurance the Company will be able to secure additional financing, because the Company does not have any commitment for such financing at this time. The Company's current liabilities decreased by $163,905 (33.5%) from September 30, 2003 to March 31, 2004 as a result of paying some accrued legal expenses and salary with its common stock. The Company anticipates its accounts payable situation to improve throughout 2004. However, the Company will continue to seek working capital through equity financing in the coming months. 13 Rimmer's bank debt of $72,399 became due in the last quarter of fiscal year 2000, although the bank has not requested repayment as of May 14, 2004. During 2004 the Company is hopeful of reducing the amount of this debt through internally generated cash flow or, possibly, re-financing the credit card debt at a lower interest rate. During the fourth quarter of 2002 the Internal Revenue Service and the State of Arizona placed tax liens on the Company's assets for the payment of approximately $38,000 of employee tax liability. The Company has been paying interest and some principal on this debt since 2000. ITEM 3. CONTROLS AND PROCEDURES The Company's principal executive officer and principal financial officer, Christina M. Strauch, after reviewing and evaluating Company's disclosure controls and procedures within 90 days prior to the filing of this quarterly report has concluded that Company's disclosure controls and procedures contained no significant deficiencies or material weakness. There have been no significant changes in Company's internal controls that could significantly affect these controls subsequent to the date of their evaluation, including corrective actions. 14 PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. None ITEM 2. CHANGES IN SECURITIES. In February 2004 the Company issued 2,500,000 restricted common stock shares to its legal counsel in conversion of $50,000 of accrued legal services and future legal services in connection with the Transaction. In February 2004 the Company also issued 4,000,000 restricted common stock shares to its Chairman in conversion of $80,000 of accrued salary. These shares were issued under Section 4(2) of the Securities Act of 1933. All other securities issued by Registrant during the quarter ended March 31, 2004 were registered with the SEC. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) EXHIBITS 31.1 Certificate Pursuant to Section 302 of the Sarbanes-Oxley Act 32.1 Certificate Pursuant to Section 906 of the Sarbanes-Oxley Act (b) REPORTS ON FORM 8-K On March 23, 2004, a Report on Form 8-K was filed by the Registrant relating to the Letter of Intent entered into with Starway Management Ltd. 15 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto authorized. RIM HOLDINGS INC. Date: May 18, 2004 By: /s/ Christina M. Strauch ------------------------------------------- Christina M. Strauch Chairman (Principal Executive Officer) and Treasurer (Principal Financial Officer) 16