U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON D.C. 20549

                                   FORM 10-QSB

             QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934


                   For the fiscal quarter ended: June 30, 2002
                         Commission file number:0-27842


                                  COLMENA CORP.
             (Exact name of registrant as specified in its charter)

         Delaware                                         54-1778587
         (State or other jurisdiction of                (I.R.S. Employer
         incorporation or organization)               Identification No.)

                      2500 N. Military Trail, Suite 225-C
                           Boca Raton, Florida 33431
                    (Address of principal executive offices)
                                   (Zip code)

                                 (561) 998-2031
              (Registrant's telephone number, including area code)


Indicate by check mark whether  registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during
the  preceding 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 ____
                                                  --

APPLICABLE TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practical date:

On August  13,  2002,  the issuer had  outstanding  25,084,131  shares of common
stock, $.01 par value per share.






<PAGE>





                                  COLMENA CORP.
                                   FORM 10-QSB
                      QUARTERLY PERIOD ENDED June 30, 2002

                                      INDEX

                                                                       Page

PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements

Balance Sheet (Unaudited)
       As of June 30, 2002..............................................  3
Statements of Operations (Unaudited)
       For the Three and Nine Months Ended June 30, 2002................  4
Statements of Cash Flows (Unaudited)
       For the Nine Months Ended June 30, 2002..........................  5

Condensed Notes to Financial Statements.................................  6-11

Item 2 - Management's Discussion and Analysis and Plan of
         Operation......................................................  10-15


PART II - OTHER INFORMATION

Item 1 - Legal Proceedings..............................................  15

Item 2 - Changes in Securities and Use of Proceeds......................  16

Item 3 - Default Upon Senior Securities.................................  17

Item 4 - Submission of Matters to a Vote of Security Holders............. 17

Item 5 - Other Information............................................... 18

Item 6 - Exhibits and Reports on Form 8-K................................ 19

Signatures............................................................... 20


<PAGE>

                                  COLMENA CORP.
                                  BALANCE SHEET
                                  June 30, 2002
                                   (Unaudited)



                                     ASSETS
<TABLE>
<S>                                                                               <C>
      Total Assets                                                                 $ -
                                                                                   ===


                                 LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES:
    Convertible Bond Payable                                                       $ 40,000
    Accounts Payable and Accrued Expenses                                           117,825
    Loans Payable - Related Party                                                   162,153
    Loan Payable                                                                     80,633
    Due to Related Party                                                            126,972
                                                                                   -------

        Total Current Liabilities                                                   527,583
                                                                                    -------

STOCKHOLDERS' DEFICIT:
    Preferred Stock ($.01 Par Value; 10,000,000 Share Authorized ;
        No Shares Issued and Outstanding)                                                 -
    Convertible Preferred Stock ($.01 Par Value; 1,000,000 Share Authorized ;
        27,563 Shares Issued and Outstanding)                                            28
    Common Stock ($.01 Par Value; 650,000,000 Shares Authorized;
        24,874,317 Shares Issued and Outstanding)                                   248,743
    Common Stock Issuable, $.01 Par Value (11,820,712 Shares)                       120,421
    Additional Paid-in Capital                                                   17,545,555
    Accumulated Deficit                                                         (18,442,330)
                                                                                ------------

        Total Stockholders' Deficit                                                (527,583)
                                                                                 -----------

        Total Liabilities and Stockholders' Deficit                                     $ -
                                                                                 ===========

</TABLE>

<PAGE>

                                  COLMENA CORP.
                            STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<S>                                              <C>                     <C>                       <C>              <C>

                                                    For the Three Months                        For the Nine Months
                                                Ended June 30,      Ended June 30,
                                                ----------------------------------------------------------------------------
                                                  2002                 2001                 2002                2001
                                                -------------------- ------------------------------------  -----------------

REVENUES                                        $    -              $    -              $    -              $   -
                                                ------                ----                 ----               ---

OPERATING EXPENSES:
    Compensation Expense                        66,124              25,878              170,368             25,878
    Consulting                                       -             459,333              146,963            548,133
    Professional and Legal Fees                  5,589               8,274               22,891             18,959
    Selling, General and Administrative         13,705                 366               20,746              3,237
                                                -------                ----              -------             -----

        Total Operating Expenses                85,418             493,851              360,968            596,207
                                                -------            --------             --------           -------

LOSS FROM OPERATIONS                           (85,418)           (493,851)            (360,968)          (596,207)
                                               --------           ---------            ----------         ---------


OTHER INCOME (EXPENSES):
    Settlement Income                          344,108                   -              338,287                  -
    Gain on Agreement Rescission                30,000                   -               30,000                  -
    Interest Expense, net                       (3,389)            (12,000)             (31,671)           (45,000)
                                               -------            --------              ---------           ---------

TOTAL OTHER INCOME (EXPENSES)                  370,719              (12,000)            336,616             (45,000)
                                               --------             --------            --------            --------

NET INCOME (LOSS)                            $ 285,301           $ (505,851)           $ (24,352)        $ (641,207)
                                              ==========          ===========           ==========        ===========


BASIC AND DILUTED:
      Net Income (Loss) Per Common Share:    $ 0.01              $ (0.03)             $ (0.00)           $ (0.04)
                                             =======             ========             ========           ========

      Weighted Common Shares Outstanding     35,169,371          16,487,074           33,015,687         16,063,864
                                             ===========         ===========          ===========        ==========
</TABLE>

<PAGE>


                                 COLMENA CORP.
                            STATEMENTS OF CASH FLOWS
                                  (Unaudited)

<TABLE>
<S>                                                                                              <C>                     <C>
                                                                                               For the Nine Months Ended June 30,
                                                                                           ----------------------------------------
                                                                                                  2002                   2001
                                                                                           --------------------   -----------------
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net Loss                                                                                    $ (24,352)            $ (641,207)
    Adjustments to Reconcile Net Loss  To Net Cash Used in Operations

           Stock Based Compensation                                                                 16,301                 15,000
           Stock Options and Warrants Issued to Consultants and Directors                           97,023                473,133
           Settlement (Income) Expense                                                            (333,193)                15,000

           Increase in:
              Accounts Payable and Accrued Expenses                                                114,274                 55,879
                                                                                                  --------                ------

Net Cash Flows Used in Operating Activities                                                       (129,947)               (82,195)
                                                                                                  ---------               --------


CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from Loans Payable - Related Party                                                    105,962                      -
    Due to Related Party                                                                            23,963                 80,139
                                                                                                   -------                ------

Net Cash Flows Provided by Financing Activities                                                    129,925                 80,139
                                                                                                   --------                ------

Net Decrease in Cash                                                                                  (22)                (2,056)

Cash - Beginning of Period                                                                             22                  2,078
                                                                                                       ---                 -----

Cash - End of Period                                                                            $       -             $       22
                                                                                                   ========                ======

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid during the year for:
   Interest                                                                                     $       -             $        -
                                                                                                   ========                 ======
   Income Taxes                                                                                 $       -             $        -
                                                                                                   ========                 ======

NON-CASH INVESTING AND FINANCING ACTIVITIES:
    Note Payable - Related Party Reclassified to Convertible Bond                               $   40,000            $        -
                                                                                                   ========                 ======
    Issuance of Common Stock for Settlement of Debt                                             $  130,966            $        -
                                                                                                   ========                 ======
</TABLE>


<PAGE>


                                  COLMENA CORP.
                          NOTES TO FINANCIAL STATEMENTS


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  to Form  10-QSB and Item 310(b) of  Regulation  S-B.
Accordingly,  the financial statements 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 have been
included and all adjustments  considered  necessary for a fair presentation have
been included and such adjustments are of a normal recurring nature.

These  financial  statements  should  be read in  conjunction  with the  audited
financial  statements  for the year ended  September  30, 2001 and notes thereto
contained  in the Report on Form  10-KSB,  as amended,  of Colmena  Corp.  ("our
Company" or the "Company") as filed with the Securities and Exchange  Commission
(the "Commission"). The results of operations for the nine months ended June 30,
2002 are not  necessarily  indicative  of the  results  for the full fiscal year
ending September 30, 2002.

NOTE 2 - CONSULTING AGREEMENT

Consulting Agreement between Our Company and the Yankee Companies, Inc.

On  January  5,  1999  (the  "Effective  Date"),  a  consulting  agreement  (the
"Agreement") was entered into between our Company and the Yankee Companies, Inc.
("Yankees"), a Florida corporation.  The Agreement was established for a term of
730 days from the Effective Date, to be renewed  automatically,  on a continuing
annual  basis,  unless  terminated  by one of the  parties  30 days prior to the
termination  of the then current  term.  The  services  provided by Yankees were
agreed to be the services, on a reasonable,  as required, basis, consistent with
Yankees'  other  business  activities.  Yankees'  areas of expertise  are mainly
comprised of corporate  structure,  organization,  and reorganization,  mergers,
acquisitions  and  divestitures,   strategic  corporate  development,  corporate
financial and equity analysis, and other corporate matters. Furthermore, Yankees
agreed to be  responsible  for  administering  the  expenditure  of the proceeds
derived by the Company  from the  exercise of options that were given to Yankees
as part of its  compensation  for the services  rendered (see below) in order to
implement the strategic  plans  developed by Yankees and to settle and discharge
the  corporate  obligations  of the  Company.  In this role,  Yankees  agreed to
establish and operate bank accounts for the Company,  using such  signatories as
Yankees deemed appropriate.




<PAGE>


                                  COLMENA CORP.
                         NOTES TO FINANICIAL STATEMENTS


NOTE 2 - CONSULTING AGREEMENT

Consulting Agreement between Our Company and Yankees

As  consideration  for the first  200  hours of  services  provided  (valued  at
$20,000),  the Company  agreed to issue to Yankees  options  (designated  as the
Class  A  Options  and  generically   referred  to  hereinafter  as  "consultant
warrants")  to purchase  shares of the  Company's  common  stock at an aggregate
exercise  price of $40,000.  The amount of underlying  shares was to be equal to
51% of the Company's common stock at such time as exercise was completed. At the
date of the consulting  agreement,  8,066,326  shares of common stock would have
been issuable,  had the consultant warrants been exercised in full on such date.
Any increase or decrease in the outstanding or reserved shares would result in a
corresponding adjustment of the consultant warrants' quantity and exercise price
per share. The consultant warrants were originally exercisable from the 10th day
until the 365th day following the effective date of a registration  statement to
have been filed with the Commission, registering the shares to be issued.

On January 4, 2000,  the Agreement was amended to: modify the required  payments
to Yankees based on the Yankees' standard hourly rates, by permitting Yankees to
accept payment in capital stock at the conversion rate of 50% of the fair market
value of such stock;  increase Yankees' ownership after exercise of the warrants
to 75% from 51% and the aggregate exercise price to $80,000 from $40,000; and to
clarify Yankees' preferential rights to subscribe for additional securities at a
purchase price of 50% of their fair market value.

On January 4, 2001,  an  additional  amendment  changed  the  consulting  fee to
$10,000 per month,  eliminating  hourly and document licensing fees, and changed
the  discounts  as noted in item  (a)(ii)  above to a  discount  of 10% from the
lowest  price at which  such  securities  are  offered to any other  person,  if
issuable  as free  trading  securities,  or a  discount  of 50% if  issuable  as
restricted  securities,  and it eliminated the 5%  introduction  fee. During the
quarter  ended June 30, 2002,  Yankees and the Company  confirmed  that they had
mutually  agreed to terminate  the  Agreement  effective  December 31, 2001.  In
connection with this amendment,  the Company  recorded a gain from the agreement
rescission of $30,000 during the quarter ended June 30, 2002.



<PAGE>


                                  COLMENA CORP.
                         NOTES TO FINANICIAL STATEMENTS



NOTE 3 - BONDS PAYABLE

On December 31, 2001 (the `exchange date'), the Company issued a Class A, Series
A,  Convertible  Bond (the "Class A Bond") to The Yankee Companies LLC ("Yankees
LLC") in exchange  for the warrant  discussed  in Note 2 and a series of matured
and  past-due  promissory  notes held by Yankees LLC. The exchange was an exempt
transaction  pursuant  to Section  3(a)(9)  of the  Securities  Act of 1933,  as
amended, and essentially  consolidated the warrant and promissory notes into the
Class A Bond.  Originally,  the Class A Bond had a principal  amount of $80,000.
The Class A Bond has a term of one-year,  with interest payable upon maturity at
the annualized  rate of 2% over the prime rate charged during the Class A Bond's
term by Citibank,  N.A.  (New York City).  The Class A Bond is secured by all of
the Company's assets, and may be subdivided, at the holders' option, into two or
more separate obligations in the principal amount of at least $10, 000 each. The
Class  A Bond  is  convertible,  at the  holders'  option,  into  shares  of the
Company's securities such that, upon complete  conversion,  the number of shares
owned by the  holders'  will be equal to 75% of the  Company's  outstanding  and
reserved  capital  stock  at  the  time  conversion  is  completed,  subject  to
anti-dilutive rights for three months thereafter.  Conversion may be effected in
whole or in part, and to date the holders have converted $40,000 in principal of
the Class A Bond into  approximately  40% of the Company's  common stock. At the
exchange date,  the fair market value of the conversion  feature of the Bond was
equal to the fair market value of the warrants  cancelled and  therefore,  there
was  no  charge  or  credit  to  operations  for  the  exchange.  In  substance,
anti-dilutive  changes in the  conversion  ratio will be considered a consulting
expense pursuant to the consulting  agreement on which the issuance of the prior
warrants was based. On May 31, 2002, the bond was assigned by Yankees LLC to the
Tucker Family  Spendthrift Trust and the Calvo Family Spendthrift Trust in equal
shares.

NOTE 4 - LOANS PAYABLE - RELATED PARTIES

On September  24, 2001,  the Company  entered into a $150,000  revolving  credit
agreement with Yankees,  Inc. Each loan under the agreement will be due one year
from the date of the loan and bears  interest at an  annualized  rate of 2% over
the prime rate charged  during the period by Citibank,  N.A. and is payable upon
demand after the one year term. The line of credit was cancelled on December 31,
2001. A new revolving credit  agreement was entered into with Yankee  Companies,
LLC containing terms identical to the agreement with Yankees, Inc. The revolving
credit agreement  expires in January 2004,  subject to automatic annual renewal,
and is secured by all of the Company's  assets. As of June 30, 2002, the Company
entered into several loans under these credit agreements.  Additional  borrowing
under the revolving  credit  agreements  aggregated  $39,444  during the quarter
ended June 30, 2002. At June 30, 2002, the total  outstanding  principal balance
was  $137,732.  The notes have been  assigned to the Tucker  Family  Spendthrift
Trust and the Calvo Family Spendthrift Trust in equal amounts.


<PAGE>


                                  COLMENA CORP.
                         NOTES TO FINANICIAL STATEMENTS


NOTE 4 - LOANS PAYABLE - RELATED PARTIES (Continued)

On March 28,  2002,  the Company  borrowed an  aggregate of $24,000 from related
parties.  Each  promissory  note is due one  year  from the date of the loan and
bears  interest at an annualized  rate of 2% over the prime rate charged  during
the period by Citibank, N.A. and is payable upon demand after the one year term.
The loans are secured by the Company's  assets. As of June 30, 2002, the Company
entered into two loan agreements with an aggregate outstanding principal balance
of $24,000.

NOTE 5 - LOAN PAYABLE

On May 1, 2002,  the Company  entered into a settlement  agreement with Deutsche
Financial Services Corporation  ("Deutsche").  Deutsche's claim was for $331,000
plus interest at the per annum rate of prime plus 6.5% since August 1, 1998, and
was based on a guaranty by the Company of a promissory  note  executed by one of
our divested  subsidiaries.  In exchange for the parties' general release of all
claims and  obligations  up to the date of the agreement,  Deutsche  received an
initial payment of $20,000 as of the filing of this report,  and is receiving an
additional  $2,500 (plus interest at the per annum rate of U.S. prime) per month
for 32 months  beginning June 15, 2002 and ending January 15, 2005 (an aggregate
additional  amount of $80,000 plus interest).  Additionally,  the Company issued
2,500,000  common shares in connection  with this  settlement  (see Note 6). The
settlement  agreement requires  accelerated  payments if the quarterly cash flow
exceeds $7500.00


NOTE 6 - COMMON STOCK TRANSACTIONS AND STOCK OPTIONS AND WARRANTS GRANTED

In connection with the consulting  agreement  between the Company and Yankees as
discussed in note 2 above, an additional 3,091,485 shares of common stock became
subject to the Class A Bonds  during the nine  months  ended June 30,  2002 as a
result of their  anti-dilutive  provisions.  The fair  value of the  option  was
estimated  on the date of grant using the  intrinsic  method of  option-pricing.
Accordingly, consulting expense of $86,963 was recognized during the nine months
ended June 30, 2002. Since Yankees  previously paid for 50% of these shares, the
Company included 1,545,742 shares in common stock issuable as of June 30, 2002.

As of May 2001, the Company  became  obligated to issue 200,000 common shares to
Anthony Q. Joffe, a former  president and current  chairman of the board,  under
his employment agreement,  which has terminated. On November 15, 2001, 24,788 of
the shares  issuable  under this  agreement  were issued.  On June 13, 2002, the
remaining 175,212 shares were issued.

<PAGE>

                                  COLMENA CORP.
                         NOTES TO FINANICIAL STATEMENTS


NOTE 6 - COMMON  STOCK  TRANSACTIONS  AND STOCK  OPTIONS  AND  WARRANTS  GRANTED
(Continued)

On December 31, 2001, the Company's board of directors determined that it was in
the best  interests  of the Company to enter into a  settlement  agreement  with
Strategica  Services  Corporation (the "Settlement  Agreement" and "Strategica,"
respectively).  In exchange for the cancellation of any and all prior agreements
between  the  parties  and their  affiliates,  including  but not  limited to an
"Investment  Banking and Advisory  Services  Agreement"  dated May 7, 1998,  and
subject to the  effectiveness of a sufficient  increase in capitalization by the
Company's  stockholders,  the Company issued Strategica  1,030,495 shares of its
common  stock,  which  will  represent  4.9%  of the  common  stock  outstanding
immediately after such issuance based on the 20,000,000 shares outstanding as of
the date of the Settlement Agreement (the "Strategica  Shares").  The Strategica
Shares have anti-dilution  rights tied  proportionately only to the Class A Bond
held by the Yankee  Companies,  LLC (or any successor  instrument  thereto) upon
complete  conversion  of the Class A Bond.  The Class A Bond,  in the  principal
amount of $80,000 plus accrued  interest,  gives Yankees the right to acquire up
to 75% of the  Company's  authorized  and reserved  common  stock (the  "Yankees
Shares"),  and the  Strategica  Shares  will be  reduced  below 4.9% only to the
extent the  Yankees  Shares are  reduced  below  75%,  and in direct  proportion
thereto.  The Settlement  Agreement's  anti-dilution  terms further provide that
upon  complete  conversion  of the  Class A Bond and the  payment  of  specified
liabilities of the Company, the Strategica Shares will not be diluted below 2.5%
of the Company's  then-outstanding common stock but that Strategica will have no
further  anti-dilutive  rights thereafter.  On June 13, 2002, the Company issued
the Strategica  Shares.  In connection with the settlement  shares,  the Company
recorded  settlement expense of $30,915 or $.03 per share during the nine months
ended June 30, 2002 which  represents the fair market value of the common shares
issuable as of the date of the agreement.

On March 6, 2002, the Company entered into a settlement  agreement with a vendor
and paid $2,750 in full settlement of debt. In connection with this  settlement,
the Company recorded  settlement  income of $25,094 during the nine months ended
June 30, 2002.

On May 13, 2002, the Company settled the claims asserted by Prime Source Leasing
Inc. ("Prime Source") and General  Electric Capital Corp.  ("GE").  Prime Source
had sued GE for, among other things, $80,000 on a stop-payment check, and GE has
asserted a contingent  third-party claim against our Company for that amount. In
addition, Prime Source had asserted a direct claim against the Company, alleging
good sold and failure to pay a promissory note for $85,606,  plus interest since
November 30, 1998 and attorney's fees. Prime Source and GE settled their primary
claim,  and  so  the  contingent  third-party  claim  against  our  Company  was
dismissed.  In  addition,  the  Company  settled its direct  dispute  with Prime
Source.  In exchange  for a general  release,  the Company  issued  Prime Source
1,000,000  shares of restricted  common stock,  to be held is escrow pending the
receipt of a signed general  release from Prime Source.  In connection with this
settlement, the Company recorded settlement income of $20,606.


<PAGE>

                                  COLMENA CORP.
                         NOTES TO FINANICIAL STATEMENTS



NOTE 6 - COMMON  STOCK  TRANSACTIONS  AND STOCK  OPTIONS  AND  WARRANTS  GRANTED
(Continued)

On May 1, 2002,  the Company  entered into a settlement  agreement with Deutsche
Financial Services Corporation ("Deutsche") (See Note 5). In June 2002, Deutsche
received  2,500,000 shares of restricted common stock,  these shares were valued
at a fair market value of $0.035 per share.  In connection  with the  settlement
agreement the Company recorded settlement income of $323,502 for the nine months
ended June 30, 2002.

On May 10, 2002, the stockholders  approved a change in the authorized shares of
the  Company  to  authorize  650,000,000  common  shares  at $0.01 par value and
10,000,000  preferred  shares at $0.001 par value.  On May 30, 2002, the Company
filed a  Certificate  of  Designation  (the  "Designation")  with  the  State of
Delaware to designate 1,000,000 Class A Non-Voting, Convertible Preferred Shares
("Class A Shares").  The Class A Shares may receive dividends as declared by the
Board of  Directors.  Each Class A Share is  convertible  into 100 common shares
except that such  conversion  is limited such that the holder may only hold less
than 5% of the common stock of the Company. The conversion rate will be adjusted
if any  recapitalization  of the Company occurs,  as defined in the Designation.
The holder of Class A Shares may not be an officer or director of the Company.

On June 18, 2002, a  stockholder  exchanged  2,756,251  common shares for 27,563
Class A Non-Voting,  Convertible  Preferred Shares,  which is an amount equal to
1/100th  the  number  of shares of  Preferred  Stock as the  number of shares of
Common  Stock  exchanged.  The  purpose  of  the  exchange  was  to  reduce  the
stockholders  common stock holdings so that stockholder will not be considered a
control  person under item 403(d) of Regulation  SB. The exchange was transacted
at the fair market value so that there was no gain or loss on the transaction.

The Company  issued  2,924,861  common  shares for debt of  $130,965  related to
accrued compensation.

During June 2002, the Company issued 221,500 shares of common stock to directors
for services  rendered.  In connection with these shares,  the Company  recorded
compensation  expense of $16,301.  As of June 30, 2002,  the shares had not been
issued. The shares are included in common stock issuable at June 30, 2002.

NOTE 7 - GOING CONCERN

The  accompanying  financial  statements  have been  prepared  assuming that the
Company will  continue as a going  concern.  Other than the  recently  initiated
consulting activities,  the Company has no other day-to-day business operations,
has recurring  losses,  and had a working capital  deficiency of $527,583 and an
accumulated  deficit of $18,442,330  at June 30, 2002.  These  conditions  raise
substantial doubt about the Company's ability to continue as a going concern.


<PAGE>

                                  COLMENA CORP.
                         NOTES TO FINANICIAL STATEMENTS


NOTE 8 - EMPLOYMENT AGREEMENTS

In July 2002, the Company engaged its Chief Financial Officer and Controller who
is paid hourly for services  performed  and $1,000 worth of common shares of the
Company  per month  computed  based on the average  closing  price for the month
ended.

Effective May 9, 2002, the Company  entered into an agreement with 7 individuals
(the "Directors") pursuant to which they will serve as Corporate Directors.  The
agreement  is for a term  of one  year.  As  consideration  for  the  Director's
services,  the members of the  Company's  board of  directors  will each receive
10,000  shares per month of the  Company's  Common  Stock plus 5,000  additional
shares for service on the audit and executive  committee,  2,500 shares for each
additional  committee  of the board of  directors  on which  they  serve,  2,000
additional  shares for service on the audit or executive  committee of the board
of directors on which they serve as chair, and 1,000 additional  shares for each
committee of the board of directors on which they serve as chair plus shares for
attending meetings.

As a material subsequent event,  effective July 1, 2002, the Company amended its
engagement agreement with Kevin W. Dornan, Esquire, who will henceforth serve as
the Company's  part-time  securities counsel. As consideration for his services,
the Company has agreed to  compensate  him  according to the  Company's pro rata
share (which is currently 50%, based on the number of Yankee clients for whom he
is providing  legal services) of (1) his current base salary of $700 per week in
cash and (2) $400 per week in Common  Stock.  The equity  portion is paid at the
end of the month, and is paid by equivalent amount of the Company's common stock
calculated by using closing transaction price for the month then ended.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION

OVERVIEW

These  financial  statements  should be read in  conjunction  with the financial
statements for the year ended September 30, 2001 and notes thereto  contained in
the Report on Form  10-KSB of our Company as filed with the  Commission.  During
November  1997,  our Company  became  engaged in the business of  marketing  and
distributing   long-distance   telephone   service  calling  cards  and  in  the
manufacture and distribution of premium hand-rolled cigars, in each case through
wholly owned  subsidiaries.  In September  1998,  following a default in payment
obligations totaling  approximately $5.6 million by the company that handled the
billing and collection for our Company's long- distance telephone services,  our
Company and its  subsidiaries  were forced to  discontinue  day-to-day  business
operations.  During  March 1999,  our  Company's  board of  directors  concluded
negotiations  to divest our  Company of all of its  wholly  owned  subsidiaries,
positioning our Company to undertake new business  endeavors or to become a more
attractive acquisition candidate.

In January 1999, our Company's board of directors signed a consulting  agreement
with  Yankees,  calling for Yankees to provide our Company with working  capital
and assistance in development and implementation of new strategic plans. Yankees
assisted our Company in  identifying  persons with claims and  potential  claims
against our  Company  and in  negotiating  with them to  amicably  resolve  such
claims. As indicated above (Note 2), this agreement has been terminated.

PLAN OF OPERATIONS

Almost all claims and  potential  claims  against our Company and our  Company's
divested  subsidiaries  identified  by Yankees and  amounting  to  approximately
$644,000  have been  amicably  resolved  through the  issuance of  approximately
6,475,000  shares of common stock through June 2002.  Yankees,  on behalf of our
Company, is currently  conducting  negotiations with certain remaining claimants
and has made offers of settlement  for claims.  While  management  believes that
there  is a  reasonable  likelihood  that  such  offers  will  be  accepted,  no
assurances  to that  effect  can be  provided.  As of  August  13,  2002 we have
identified the following claims on which we have pending offers of settlement:

                                   Basis for         Amount        Compromise
Claimant                            Claim            of Claim       Offered
Diners Club                          (1)            $  14,206.        (1)
Federal Express                      (2)           $    7,299.        (2)
----------
(1)  On March 14, 2001, the circuit court for Palm Beach County, Florida entered
     a final judgement in favor of Citicorp Diners Club in the amount of $14,206
     for  expenses  incurred  by Madhu  Sethi,  a former  officer  of one of our
     Company's  former  subsidiaries.  Our Company has offered  $1,400 to settle
     this claim.

(2)  Overnight  shipping costs incurred in 1998. Our Company has offered $750 to
     settle this claim.

Except for recently initiated consulting  activities,  our Company currently has
no day-to-day business operations other than those pertaining to the maintenance
of our corporate  existence and the filing of reports required by the Commission
and our  efforts to become an active  reseller of  BellSouth  telecommunications
services, as discussed more fully in Item 5.

<PAGE>

Consulting Activities

During August 2001, in response to Yankees' suggestions,  our Company's board of
directors authorized our Company's officers to negotiate  consulting  agreements
with third parties that desire to avail  themselves of our Company's  experience
as a reporting  company under the Exchange  Act. Such  assistance is expected to
involve  the  recruitment  and  supervision  of  professional  advisors  such as
attorneys, auditors, investment bankers, transfer agents, officers and directors
who have the desired  experience in operating  public  companies,  and access to
procedures  and policies that Yankees has made  available for use by our Company
in complying with federal and state securities and corporate laws.


Our Company expects,  in exchange for such services,  that the consulting client
will  register a percentage  of its common  stock for issuance to our  Company's
stockholders,  as  of  an  agreed-upon  date  following  the  execution  of  the
consulting  agreement.  The amount of such common stock will vary depending upon
the circumstances of each  transaction.  The issuance of shares to our Company's
stockholders will be conditioned on prior registration with the Commission,  and
the failure to conclude such registration would void the agreement.

Registration  of shares  directly to our Company's  stockholders is necessary in
order for our Company to avoid inadvertently becoming an investment company, and
provides a major benefit to consulting  clients in that they obtain a large base
of stockholders, including all of our Company's market makers. The major benefit
of the consulting services to our Company is that it will be continually exposed
to emerging companies,  some of which should prove to be attractive  acquisition
candidates or candidates for strategic operating alliances (cooperative business
activities  not  involving  shares of equity  ownership)  that fit our Company's
strategic objectives.

Our Company does not yet have any consulting clients,  although it is discussing
such possibility with several candidates.

The foregoing plan of operation  contains  forward-looking  statements  that are
subject to risks and  uncertainties,  which could cause actual results to differ
materially  from those  discussed  in the  forward-looking  statements  and from
historical results of operations. Among the risks and uncertainties, which could
cause such a difference,  are those  relating to our Company's  dependence  upon
certain key personnel,  our ability to manage our growth,  our Company's success
in implementing our business strategy,  our success in arranging financing where
required,  and the risk of economic and market factors  affecting our Company or
our  customers.  Many of such risk factors are beyond the control of our Company
and its management.

NINE MONTHS ENDED JUNE 30, 2002 COMPARED TO NINE MONTHS ENDED JUNE 30, 2001

Our  Company  reported  net losses for the nine  months  ended June 30,  2002 of
$(24,352)  and net loss for the nine months  ended June 30, 2001 of  $(641,207).
This  translates  to a per-share  loss of $(0.00) for the nine months ended June
30,  2002 and a per share loss of  $(0.04)  for the nine  months  ended June 30,
2001.

Our Company had no  revenues  for the nine months  ended June 30, 2002 and 2001,
respectively. Operating expenses decreased to $360,968 for the nine months ended
June 30, 2002 as compared to $596,207  for the nine months  ended June 30, 2001.
The decrease was due to decreased consulting fees resulting from the issuance of
common  stock  warrants  and the accrual of  consulting  fees to Yankees,  which
aggregated  $176,963  and  $533,133  for the nine months ended June 30, 2002 and
2001,  respectively.  Also,  effective  December  31,  2001,  we  cancelled  our
consulting agreement with Yankees.

Professional  fees were  $22,891  for the nine  months  ended  June 30,  2002 as
compared to $18,959 for the nine months  ended June 30, 2001,  and  compensation
expense  increased  to  $153,694  for the nine  months  ended  June 30,  2002 as
compared  $25,878 for the nine months ended June 30, 2001.  The increase was due
to increased director and officer activities related to the restructuring of the
Company.

During the nine months ended June 30,  2002,  we recorded  settlement  income of
$338,287  consisting of $33,665  settlement  expense in connection with the cash
payments  and the  issuance  of common  shares  offset by  settlement  income of
$371,952.

For the nine months ended June 30, 2002,  we recorded a gain of $30,000  related
to the cancellation of our consulting agreement with Yankees.

No additional meaningful  comparisons can be made for the nine months ended June
30, 2002 as compared to the nine months ended June 30, 2001.

<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

As of June  30,  2002,  our  Company  had  limited  cash  on  hand  to meet  our
obligations. Our Company has financed our operating activities through loans and
advances from Yankees, LLC.

At June 30,  2002,  our Company  had a  stockholders'  deficit of  approximately
$527,583.  Our  Company's  future  operations  and growth are  dependent  on our
ability, with the assistance of Yankees, LLC, to raise capital for expansion and
to implement our strategic plan.

On May 1, 2002,  our Company  entered into a settlement  agreement with Deutsche
Financial Services Corporation  ("Deutsche").  Deutsche's claim was for $331,000
plus interest at the per annum rate of prime plus 6.5% since August 1, 1998, and
was based on a guaranty by our Company of a promissory  note  executed by one of
our divested  subsidiaries.  In exchange for the parties' general release of all
claims and  obligations  up to the date of the agreement,  Deutsche  received an
initial payment of $20,000 as of the filing of this report,  and is receiving an
additional  $2,500 (plus interest at the per annum rate of U.S. prime) per month
for 32 months  beginning June 15, 2002 and ending January 15, 2005 (an aggregate
additional  amount of $80,000 plus interest).  Deutsche also received  2,500,000
shares of restricted common stock.

Net cash used in operations  was  $(129,947)  for the nine months ended June 30,
2002 as  compared to  $(82,195)  for the nine months  ended June 30,  2001.  The
difference  is  primarily  due to the  increase in accounts  payable and accrued
expenses offset by settlement income. Net cash provided by financing  activities
for the nine  months  ended June 30,  2002 was  $129,925 as compared to net cash
provided by financing  activities  of $80,139 for the nine months ended June 30,
2001. The difference was  attributable to the increase in funding from a related
party.

We currently have no material commitments for capital  expenditures.  Other than
advances  received  from Yankees LLC, we have no external  sources of liquidity.
Accordingly,   we  may  not  have   sufficient  cash  flow  from  operations  to
sufficiently  meet all of our cash  requirements  for the  next 12  months.  Our
Company's  future  operations  and growth are  dependent on our ability to raise
capital for expansion,  and to seek additional  revenue sources.  If our Company
decides   to  pursue   any   acquisition   opportunities   or  other   expansion
opportunities, we may need to raise additional capital, although there can be no
assurance such capital-raising activities would be successful.

RECENT ACCOUNTING PRONOUNCEMENTS

Statement  No. 141  "Business  Combinations"  ("SFAS 141")  establishes  revised
standards for accounting for business combinations.  Specifically, the statement
eliminates the pooling method,  provides new guidance for recognizing intangible
assets  arising  in  a  business  combination,   and  calls  for  disclosure  of
considerably  more information about a business  combination.  This statement is
effective  for business  combinations  initiated  on or after July 1, 2001.  The
adoption of this pronouncement on July 1, 2001 did not have a material effect on
our Company's financial position, results of operations or liquidity.

Statement No. 142 "Goodwill and Other  Intangible  Assets" ("SFAS 142") provides
new guidance  concerning  the accounting  for the  acquisition  of  intangibles,
except those acquired in a business  combination,  which is subject to SFAS 141,
and the  manner  in which  intangibles  and  goodwill  should be  accounted  for
subsequent  to their  initial  recognition.  Generally,  intangible  assets with
indefinite  lives, and goodwill,  are no longer  amortized;  they are carried at
lower of cost or market and subject to annual impairment evaluation,  or interim
impairment  evaluation if an interim  triggering event occurs,  using a new fair
market value  method.  Intangible  assets with finite lives are  amortized  over
those lives,  with no stipulated  maximum,  and an impairment  test is performed
only when a triggering event occurs.  This statement is effective for all fiscal
years  beginning  after December 15, 2001. The Company  believes that the future
implementation of SFAS 142 on October 1, 2002 will not have a material effect on
our Company's financial position, results of operations or liquidity.

Statement  No. 144  "Accounting  for the  Impairment  or Disposal  of  Long-Live
Assets" ("SFAS 144") supercedes Statement No. 121 "Accounting for the Impairment
of Long-Lived  Assets and for Long-Lived Assets to be Disposed of" ("SFAS 121").
Although it retains the basic requirements of SFAS 121 regarding when and how to
measure  an  impairment  loss,  SFAS  144  provides  additional   implementation
guidance.  SFAS 144 excludes  goodwill and intangibles not being amortized among
other exclusions.  SFAS 144 also supercedes the provisions of APB 30, "Reporting
the Results of  Operations,"  pertaining to  discontinued  operations.  Separate
reporting of a discontinued  operation is still  required,  but SFAS 144 expands
the  presentation  to include a component of an entity,  rather than  strictly a
business  segment as  defined in SFAS 131,  "Disclosures  about  Segments  of an
Enterprise  and  Related  Information."  SFAS 144 also  eliminates  the  current
exemption  to  consolidation  when  control  over a  subsidiary  is likely to be
temporary.  This  statement is effective  for all fiscal years  beginning  after
December 15, 2001.  The  implementation  of SFAS 144 on October 1, 2002 will not
have  a  material  effect  on  our  Company's  financial  position,  results  of
operations or liquidity.

<PAGE>

Going Concern

The accompanying  financial  statements have been prepared assuming that the our
Company  will  continue  as a  going  concern.  Except  for  recently  initiated
consulting activities,  the Company has no other active business operations, has
recurring  losses,  had cash used in  operations of $129,947 for the nine months
ended  June 30,  2002,  had a working  capital  deficiency  of  $527,583  and an
accumulated  deficit of $18,442,330  at June 30, 2002.  These  conditions  raise
substantial doubt about our Company's ability to continue as a going concern.

Our Company is taking  steps to address  this  situation,  however.  Our Company
maintains an agreement  as a telephone  service  reseller  with  BellSouth,  our
application  for a ALEC license in Florida  received final approval in May 2002,
and   management   looks   to   expand   on  such   operations,   or   locate  a
merger/acquisition  candidate. In the meantime, management will continue to rely
on loans from Yankees LLC to fund operations  until other income is derived from
an acquisition,  consulting activities, or our telecommunications resale license
and agreements.  No assurances can be provided,  however,  that such alternative
sources  will ever  generate  income or that  Yankees  will  continue to provide
loans.

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

     On May 1, 2002,  our  Company  entered  into a  settlement  agreement  with
Deutsche Financial Services Corporation  ("Deutsche").  Deutsche's claim was for
$331,000  plus interest at the per annum rate of prime plus 6.5% since August 1,
1998,  and was based on a guaranty by our Company of a promissory  note executed
by one of our  divested  subsidiaries.  In  exchange  for the  parties'  general
release of all claims and obligations up to the date of the agreement,  Deutsche
has received an initial payment of $20,000 as of the filing of this report,  and
is to receive an additional  $2,500 (plus interest at the per annum rate of U.S.
prime) per month for 32 months  beginning  June 15, 2002 and ending  January 15,
2005 (an aggregate  additional  amount of $80,000 plus interest).  Deutsche also
received  2,500,000 shares of restricted  common stock. A copy of the settlement
agreement was filed as an exhibit to the Company's report on Form 10-QSB for the
quarter  ended  March  31,  2002 and is  incorporated  herein  by  reference  in
accordance with Commission Rule 12b-23.

     On May 13,  2002,  our Company  also  settled the claims  asserted by Prime
Source Leasing Inc. ("Prime Source") and General Electric Capital Corp.  ("GE").
Prime  Source had sued GE for,  among other  things,  $80,000 on a  stop-payment
check,  and GE has asserted a contingent  third-party  claim against our Company
for that amount.  In addition,  Prime Source had asserted a direct claim against
our  Company,  alleging  good  sold and  failure  to pay a  promissory  note for
$85,605.07,  plus interest since November 30, 1998 and  attorney's  fees.  Prime
Source and GE settled their primary  claim,  and so the  contingent  third-party
claim against our Company was dismissed.  In addition,  our Company  settled its
direct dispute with Prime Source. In exchange for a general release, our Company
issued Prime Source 1,000,000  shares of restricted  common stock, to be held in
escrow pending the receipt of a signed General Release from Prime Source.

Item 2.  Changes in Securities

     In connection with the consulting agreement between the Company and Yankees
as discussed in note 2 above,  an  additional  3,091,485  shares of common stock
became subject to the Class A Bonds during the three months ended March 31, 2002
as a result of their anti-dilutive provisions.  The fair value of the Shares was
estimated  on the date of grant using the  intrinsic  method of  option-pricing.
Accordingly,  consulting  expense of  $86,963  was  recognized  during the three
months ended December 31, 2001.

     As of May 2001, our Company became obligated to issue 200,000 common shares
to Anthony Q. Joffe, a former president and current chairman of the board, under
his employment agreement,  which has terminated. On November 15, 2001, 24,788 of
the shares  issuable  under this  agreement  were issued.  On June 13, 2002, the
remaining 175,212 shares were issued.

     On June 13, 2002, in connection  with a settlement  agreement,  the Company
issued a prior  consultant to the Company  1,030,495 shares of its common stock.
In  connection  with the  settlement  shares,  the Company  recorded  settlement
expense of $30,915 or $.03 per share during the nine months ended June 30, 2002,
which  represents the fair market value of the common shares  issuable as of the
date of the agreement.

<PAGE>

     On May 14, 2002, our Company's board of directors  adopted a certificate of
designation  for 1,000,000  shares of the 10,000,000  shares of preferred  stock
authorized  by the  shareholders  at the Annual  Meeting  (the  "Certificate  of
Designation").  A copy of the Certificate of Designation was filed as an exhibit
to the  Company's  10-QSB  report for the  quarter  ended  March 31, 2002 and is
incorporated  herein by reference in  accordance  with  Commission  Rule 12b-23.
Subject to the  effectiveness  of the Certificate of Amendment  authorizing such
preferred stock, the Certificate of Designation  designates  1,000,000 shares as
"Class A Non-Voting,  Convertible  Preferred Stock" (the "Preferred Stock"). The
holder  of shares of the  Preferred  Stock  will be  entitled  to all  dividends
declared by the board of  directors  at a rate per share 100 times that paid per
share of common  stock,  and will be entitled to convert each share of Preferred
Stock for 100 shares of common stock (subject to adjustment  upon the occurrence
of certain events as specified in the Certificate of  Designation),  but only to
the  extent  that the  aggregate  number of shares of common  stock  held by the
holder  (and any other  person with whom the holder  must  aggregate  shares for
purposes of Commission  Rule 144) is less than 5% of our  Company's  outstanding
common stock so that the holder will not be deemed to have "control"  within the
meaning of Commission Rule 405. The Certificate of Designation further provides:
(1) for liquidation rights that treat one share of Preferred Stock as if it were
100  shares of  common  stock in the event of the  liquidation,  dissolution  or
winding  up of our  Company;  (2) that the  Preferred  Stock will have no voting
rights;  and (3) that no holder of  Preferred  Stock may serve as an  officer or
director of our Company,  or serve in any  capacity  with our Company that would
render such person a "control  person"  within the meaning of the Securities Act
or the Exchange Act.

     On May 13, 2002,  our Company  settled the claims  asserted by Prime Source
Leasing Inc.  ("Prime Source") and General  Electric  Capital Corp.  ("GE").  In
exchange for a general release, our Company issued Prime Source 1,000,000 shares
of restricted common stock, to be held is escrow pending the receipt of a signed
general  release from Prime Source.  In  connection  with this  settlement,  the
Company recorded settlement income of $20,606.

     On May 1, 2002,  our  Company  entered  into a  settlement  agreement  with
Deutsche Financial Services Corporation ("Deutsche") (See Note 5). In June 2002,
Deutsche received 2,500,000 shares of restricted common stock, these shares were
valued at a fair market value of $0.035 per share.

     On May 14, 2002, our Company entered into an "Exchange  Agreement" with the
Calvo Family  Spendthrift Trust ("CFST"),  whereby the CFST exchanged all of its
shares of our Company's  common stock which it holds in excess of one share less
than 5% of our  Company's  outstanding  common stock for shares of our Company's
non-voting  Preferred  Stock (as  discussed  in the  preceding  paragraph).  The
exchange was effected in reliance on the exemption from registration provided by
Section  3(a)(9) of the  Securities  Act and Section  517.061(6)  of the Florida
Securities and Investor Protection Act. Pursuant to the Exchange Agreement,  the
CFST  exchanged  2,756,251 of the 3,756,250  shares of common stock it currently
holds  for  27,563  shares  of the  non-voting  Preferred  Stock.  The  Exchange
Agreement is incorporated herein by reference in accordance with Commission Rule
12b-23.

     Our Company issued  2,924,861 common shares for debt of $130,965 related to
accrued compensation.

     During June 2002,  our Company  issued  221,500  shares of common  stock to
directors for services  rendered.  In connection with these shares,  our Company
recorded  compensation  expense of $16,301.  As of June 30, 2002, the shares had
not been issued.  The shares are  included in common stock  issuable at June 30,
2002.

Item 3.  Defaults Upon Senior Securities

     As  permitted  by  Commission  Rule  12b-23,  the  response to this item is
incorporated by reference from the corresponding item in our Company's report of
Form 10-KSB for the fiscal year ended September 30, 2001.

<PAGE>

Item 4.  Submission of Matters to a Vote of Security Holders.

     On May 10, 2002, our Company held its Annual Meeting of  Stockholders  (the
"Annual Meeting") in Boca Raton, Florida, pursuant to the notice provided in the
Definitive  Schedule 14C filed with the Commission on April 11, 2002, and mailed
to all stockholders of record on April 12, 2002. At the Annual Meeting,  after a
quorum was validly established, the shareholders took the following actions: (1)
ratified the reactivation of our Company's  corporate  charter;  (2) elected the
following  seven  directors:  Anthony Q. Joffe;  Edward C.  Dmytryk;  Vanessa H.
Lindsey;  Charles J. Champion;  Robert S. Gigliotti;  Lawrence Van Etten; and G.
Richard Chamberlin;  (3) ratified the appointment of Salberg & Company,  P.A. as
our Company's independent accountants;  (4) approved a written compensation plan
for directors;  (5) approved a  non-qualified  stock option and stock  incentive
plan for use in compensating  officers and employees of our Company during 2002;
(6)  ratified  a  series  of  amendments  to  our   Company's   certificate   of
incorporation (a copy of the Certificate of Amendment was filed as an exhibit to
the  Company's  Report on Form 10-QSB for the  quarter  ended March 31, 2002 and
incorporated herein by reference in accordance with Commission Rule 12b-23): (a)
limiting and  clarifying our Company's  purposes;  (b) increasing our authorized
common stock from 20,000,000 shares to 650,000,000  shares,  with a par value of
$0.01 per share;  (c)  authorizing  10,000,000  additional  shares as  preferred
stock,  with  a  par  value  of  $0.001,   and  with  all  the  preferences  and
characteristics  to be  determined  by the board of directors on a  case-by-case
basis prior to issuance and subject to the requirements of Sections 103, 151 and
102 (4) of Delaware's  General  Corporation  Law; (d)  authorizing  the board of
directors,  without further shareholders  approval,  to amend the certificate of
incorporation  from time to time for specified  purposes;  (e)  establishing the
required  quorum for future  stockholders  meetings at  one-third  of the shares
entitled  to  vote;  (f)  adopting  traditional  Delaware  corporate  provisions
relating to  compromise  and  arrangement;  and (g)  providing for the automatic
expiration  of the term of any director who fails to maintain a certain level of
attendance  at  regular  or  special  meetings  of the  board  and of any  board
committee on which the member sits; (7) ratified an additional  amendment to the
certificate of incorporation,  effecting a reverse split of our Company's common
stock on the basis of  between  1 share for every 5 shares  held and 1 share for
every 20 shares held,  with a resulting par value per share of between $0.05 and
$0.20,  to be filed by the board at a time the board deems most  appropriate  to
the needs of our Company and  authorizing  the board to abandon the amendment at
any time before it becomes effective;  and (8) approved a series of shareholders
proposals  offered at the Annual  Meeting:  (a) authorizing the board to acquire
one or more businesses  during the next 4 fiscal  quarters;  (b) authorizing the
board  during  the next 4 fiscal  quarters  to dispose  of any  investments  and
subsidiaries  our  Company  may have;  (c)  authorizing  the  board to  finalize
settlements with our Company's  creditors,  restructure any settlements to date,
and to negotiate to obtain any funds required to carry out such settlements; (d)
ratifying  and  confirming  all  settlements  that  have  been  negotiated  with
creditors,   and  authorizing  the  board  to  finalize  currently  contemplated
settlements;  (e)  authorizing  the board to adopt an insider trading policy for
our Company;  (f) authorizing the board to change our Company's  domicile to one
in which it is easier  for the  stockholders  to amend our  Company's  corporate
charter  without prior approval by the board;  and (g)  authorizing the board to
appoint a select committee to recommend a change in the name of the corporation,
which the board may adopt without further shareholder approval. The shareholders
also approved an amendment to Article I, Section 6 (a) of our Company's by-laws,
setting the required quorum for shareholders  meetings at no less than one-third
of the shares  entitled to vote at the meeting,  to make the by-laws  consistent
with the newly-adopted Certificate of Amendment.

Item 5.  Other Information

     On April 8, 2002, the Florida Public Service  Commission (the "PSC") issued
our Company  Certificate No. 8047,  authorizing us to provide  Alternative Local
Exchange  Telecommunications  ("ALEC")  services in the State of Florida.  Under
Florida law,  the basic local  telecommunications  services  provided by an ALEC
must include access to operator services, "911" services, and relay services for
the hearing impaired. The PSC issued a final consummating order on May 6, 2002.

     On May 10,  2002,  our  Company  signed a  renewal  of our  agreement  with
BellSouth Telecommunications, Inc. ("BellSouth"). The agreement is for a term of
three (3) years (with any renewal  thereof to be negotiated at least six to nine
months in advance of expiration), and authorizes our Company to resell BellSouth
retail telecommunications  services and products in Florida, as well as in eight
other states provided we receive the necessary  regulatory  permits and licenses
to operate in those states (Alabama, Georgia, Kentucky, Louisiana,  Mississippi,
North Carolina, South Carolina and Tennessee). BellSouth's services will be made
available  to our Company,  according to a schedule of discounts  that vary from
state to state as set forth in the  agreement,  for resale by our Company to end
users. The BellSouth services available to our Company for resale include all of
the  telecommunications  services  BellSouth  makes  available  pursuant  to its
"General  Subscriber Services Tariff" and "Private Line Services Tariff," unless
any  exclusions  apply in a given state,  and include  business and  residential
service as well as mobile services (where not excluded).


<PAGE>

     On May 10,  2002,  our  Company's  board  of  directors  met and  took  the
following actions: (a) elected Anthony Q. Joffe as President and Chief Executive
Officer;   Vanessa  H.   Lindsey  as  Vice   President,   Secretary   and  Chief
Administrative   Officer;   Adam  Wasserman  as  Chief  Financial   Officer  and
Controller;  and Kevin W. Dornan,  Esq. as General  Counsel;  (b)  appointed the
following  directors  to  committees  of the board:  Anthony  Joffe and  Vanessa
Lindsey to the Executive Committee;  independent  directors Charles Champion and
Robert  Gigliotti to the Audit  Committee;  and outside  directors  Lawrence Van
Etten,  G. Richard  Chamberlin,  and Bob Gigliotti to the 2002 Stock Option Plan
Committee;  (c)  adopted  an  insider  trading  policy  for  all  employees  and
independent  contractors of our Company, a copy of which was filed as an exhibit
to the Company's  Report on Form 10-QSB for the quarter ended March 31, 2002 and
is  incorporated  herein by reference in accordance with Commission Rule 12b-23,
warning all such persons of the  illegality  of "insider  trading" and "tipping"
and requiring them to maintain any material,  nonpublic  information they may be
privy  to  as   confidential   in  accordance   with   regulation   FD,  Section
243.100(b)(2)(ii), and to refrain from trading in our Company's securities while
in possession  of any such  information  until it has been made public;  and (d)
entered  into  an  agreement  with  Yankees,   our  Company's  former  strategic
consultant, to control the use of material nonpublic information (the "Nonpublic
Information Agreement"). A copy of the Nonpublic Information Agreement was filed
as an exhibit to the Company's Report of Form 10-QSB for the quarter ended March
31, 2002 and is  incorporated  herein by reference in accordance with Commission
Rule  12b-23,  and is  designed  to ensure  that our  Company and Yankees are in
continuing full compliance with Regulation FD. Our Company has agreed to provide
Yankees with prompt  written notice  whenever it provides  Yankees with material
nonpublic  information,  and Yankees  agrees to  maintain  such  information  in
confidentiality  pursuant to Regulation FD, Section 243.100  (b)(2)(ii),  for at
least forty-eight hours and to refrain from trading in our Company's securities,
until such information has been made public through our Company's  issuance of a
press release or an appropriate  filing with the  Commission.  This agreement is
intended to  supplement,  and not replace,  our Company's and Yankees'  existing
obligations under federal and state securities laws.

Item 6.  Exhibits and Reports on Form 8-K.

   (a)      Exhibits and Index of Exhibits

     As  permitted  by  Commission  Rule  12b-23,  the  response to this item is
incorporated by reference from the corresponding item in our Company's report of
Form 10-KSB for the fiscal year ended September 30, 2001 and Form 10-QSB for the
quarter ended March 31, 2002, except for the follow exhibits:

 10.49    Amended Engagement Agreement with Kevin W. Dornan, dated July 1, 2002.

 99.6     Sarbanes-Oxley CEO Certification

 99.7     Sarbanes-Oxley CFO Certification

   (b)      Reports on Form 8-K

     Our Company  filed a current  report on Form 8-K on June 28, 2002, in which
in Item 5, we  reported  the  issuance  of  common  shares  in  connection  with
settlement agreements and debt conversions and the exchange of common shares for
preferred shares.

                                   SIGNATURES

     In accordance with the requirements of the Exchange Act, our Company caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                  COLMENA CORP.

Dated:  August 14, 2002               By:  /s/ Anthony Q. Joffe
                                      Anthony Q. Joffe, President,
                                      Chief Executive Officer and Director

Dated:  August 14, 2002               By:  /s/ Adam Wasserman
                                      Adam Wasserman
                                      Chief Financial Officer and Controller


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