KINGSLEY COACH, INC. FIRST QUARTER 10QSB
U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-QSB/A1
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File No. 0-21733
KINGSLEY COACH, INC.
(Formerly Micro-Hydro Power, Inc.)
(Name of Small Business Issuer in its Charter)
DELAWARE 87-0369035
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
64 Old Route 522
Middleburg, PA 17842
(Address of Principal Executive Offices)
Issuer's Telephone Number: (570)837-7114
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Sections 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.
(1) Yes X No (2) Yes X No
---- ---- ---- ----
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS
None; not applicable.
APPLICABLE ONLY TO CORPORATE ISSUERS Indicate the number of
shares outstanding of each of the Registrant's classes of common stock,
as of the latest practicable date:
March 31, 1999
Common Voting Stock
11,401,010
March 31, 1999
Preferred Stock
-0-
PART I - FINANCIAL INFORMATION
Item 1.Financial Statements.
The Financial Statements of the Registrant required to be filed with
this 10-QSB Quarterly Report were prepared by management and
commence on the following page, together with related Notes. In the opinion
of management, the Financial Statements fairly present the financial
condition of the Registrant.
<TABLE>
KINGSLEY COACH, INC.
(FORMERLY Micro-Hydro Power, Inc.)
BALANCE SHEET
March 31, 1999 and December 31, 1998
(Unaudited)
<CAPTION>
ASSETS
3/31/99 12/31/98
<S> <C> <C>
Current Assets:
Cash $ 87,841 $ 67,724
Accounts Receivable 22,959 22,959
Inventory 847,636 800,172
------- -------
Total Current Assets 958,436 890,855
Property & Equipment, net 98,682 98,682
Other Assets:
Deposits 3,650 3,650
--------- -------
TOTAL ASSETS $1,060,768 $ 993,187
========= =======
LIABILITIES & STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts Payable $ 102,768 $ 145,334
Accrued Liabilities 22,187 22,187
Payable - Related Party 104,878 80,414
Payroll Taxes Payable 45,076 44,596
Customer Deposits 687,260 540,868
Note Payable - Manufacturers 335,000 200,000
Note Payable - Other 470,502 479,523
Note Payable - Shareholder 537,846 537,846
Deferred Credits 52,367 0
--------- ---------
Total Current Liabilities 2,357,884 2,050,768
Stockholders' Deficit
Preferred stock, $.00001 par value;
authorized 5,000,000 shares; issued
and outstanding -0- shares 0 0
Common stock, $.00001 par value;
authorized 30,000,000 shares;
issued and outstanding 11,401,010
at 3/31/99, 10,100,010 at 12/31/98 114 101
Additional Paid-in Capital 224,390 191,878
Accumulated Deficit (1,249,560) (1,249,560)
Current Year Deficit ( 272,060) -
--------- ---------
Total Stockholders' Deficit (1,297,116) (1,057,581)
TOTAL LIABILITIES
AND STOCKHOLDERS' DEFICIT $1,060,768 $ 993,187
========= ========
</TABLE>
See accompanying notes to financial statements.
<TABLE>
KINGSLEY COACH, INC.
(Formerly Micro-Hydro Power, Inc.)
STATEMENTS OF OPERATIONS
For the Three Month Periods Ended March 31, 1999 and 1998
(Unaudited)
<CAPTION>
Three Months Three Months
Ended Ended
3/31/99 3/31/98
<S> <C> <C>
REVENUE
Sales $ 133,306 $ 0
Cost of Sales (128,211) 0
------- -------
Gross Margin 5,095 0
General and Administrative Expenses 252,232 2,029
------- ------
Net Loss from Operations (247,137) (2,029)
Other Income/Expense
Interest Expense (24,923) 0
------ ------
Total Other Income/Expense (24,923) 0
Net Loss Before Taxes (272,060) (2,029)
Income Taxes 0 0
------- ------
Net Loss $(272,060) $(2,029)
======= ======
Loss Per Share $ (.02) $(.0003)
======= ======
Weighted Average
Shares Outstanding 11,401,010 7,300,010
========== =========
</TABLE>
See accompanying notes to the financial statements.
<TABLE>
KINGSLEY COACH, INC.
(Formerly Micro-Hydro Power, Inc.)
STATEMENT OF STOCKHOLDERS' DEFICIT
FOR THE QUARTER ENDED MARCH 31, 1999
<CAPTION>
Addit'l Accum- Total
Shares Common Paid-in ulated Stockholders'
Issued Stock Capital Deficit Deficit
<S> <C> <C> <C> <C> <C>
Balance, December
31, 1998 10,100,010 $ 101 $191,878 $(1,249,560) $(1,057,581)
Common stock issued
for services
rendered 1,301,000 13 32,512 32,525
Net Loss for the
Period Ended
March 31, 1999 (272,060) (272,060)
---------- ----- -------- ---------- ----------
Balance, March 31,
1999 11,401,010 $ 114 $224,390 $(1,521,620) $(1,297,116)
========== ===== ======== ========== ==========
</TABLE>
See accompanying notes to the financial statements.
<TABLE>
KINGSLEY COACH, INC.
(Formerly Micro-Hydro Power, Inc.)
STATEMENTS OF CASH FLOWS
For the Three Month Periods Ended March 31, 1999 and 1998
(Unaudited)
<CAPTION>
Three Months Three Months
Ended Ended
3/31/99 3/31/98
<S> <C> <C>
Cash Flows Provided By/Used For
Operating Activities
Net Loss $ (272,060) $ (2,029)
Adjustments to reconcile
net loss to net cash provided by/
used in operating activities:
Increase in inventory (47,464) 0
Increase in payroll liabilities 480 0
Decrease in accounts payable (42,566) (100)
Increase in customer deposits 146,392 0
Increase in deferred credits 52,367 0
Services rendered for stock 32,525 0
------- -----
Net Cash Provided By/Used
for Operating Activities (130,326) (2,129)
Cash Flows Provided By/Used for
Financing Activities
Principal increase in notes payable 150,443 0
Investment by shareholder 0 2,129
------- -----
Net Cash Provided By Financing
Activities 150,443 2,129
------- -----
Net Increase in Cash 20,117 0
Beginning Cash Balance 67,724 0
------ -----
Ending Cash Balance 87,841 0
====== =====
Supplemental Disclosure
Interest paid 24,923 0
Income taxes paid 0 0
</TABLE>
NOTES TO FINANCIAL STATEMENTS: Interim financial statements reflect
all adjustments which are, in the opinion of management, necessary to
a fair statement of the results for the periods. The December 31, 1998
balance sheet has been derived from the audited financial statements. These
interim financial statements conform with the requirements for interim
financial statements and consequently do not include all the disclosures
normally required by generally accepted accounting principles.
Item 2. Management Discussion and Analysis or Plan of Operation for the
Period Ended March 31, 1999, including material events as applicable
The Company was essentially dormant for ten years until an Agreement and
Plan of Reorganization was executed on December 18, 1998, between the
Company and Kingsley Coach, LLC, a Louisiana limited liability company,
following the execution of a Letter of Intent between the companies on
November 8, 1998. The result was the acquisition of the assets and
liabilities of The Kingsley Coach, LLC.
We accumulated losses through December 31, 1998 amounting to
$(1,249,560) and had a net working capital deficiency of $(1,057,581) at
December 31, 1998. We accumulated losses through March 31, 1999 amounting to
$(272,060) and have a net working capital deficiency of $(1,297,116) at March
31, 1999. Research and development activities and costs in the amounts of
$375,000 for 1997 and $600,000 for 1998 are represented in this deficiency.
We moved our operations, including inventory, equipment and staff during
the quarter ended March 31, 1999. The costs related to the move, including the
related loss of sales revenue, resulted in the loss for the quarter of
$(272,060).
We issued 1,301,000 shares of common stock during the quarter to board
members, officers, and employees of Kingsley Coach, Inc. for services rendered
to us.
Management believes it can satisfy cash requirements through the end of
the year from cash flow from operations without needing to raise additional
funds. We are considering raising additional capital in order to
increase inventory and thereby speed up delivery time of our product to our
customers, and also to improve our marketing efforts. No specific
plans for such capital raising have been made at this time.
We are pursuing product research and development on more high-end
and exotic materials for installation on the interior of our coaches, which
we expect will create higher per-unit sales and produce greater
profit margins.
We are considering upgrading our paint and graphic design facility, which
would provide more space and would allow for more computer-based design and
application of our graphics and paints, which we expect will create higher
per-unit sales and produce greater profit margins.
We recognize that our product is considered a luxury item, and that as
the economy has enjoyed remarkable growth for some time, the growth cycle may
end, detrimentally affecting consumer interest in luxury items. However, we
have not seen a decrease in interest or in sales, and expect, as more
babyboomers begin consider retirement, that sales will continue to increase
for the foreseeable future, even if the economy experiences a downturn.
The Year 2000, or Y2K problem concerns potential failure of certain
computer software to correctly process information because of the software's
inability to calculate dates. We rely minimally on computers or computer
applications and software, and believe that our manual systems can serve as
adequate backup should a Y2K issue develop. We have reviewed and tested our
computer systems and applications and believe that they are Y2K compliant. We
can give no assurance that third parties with whom we do business or intend to
do business will ensure Year 2000 compliance in a timely manner or that, if
they do not, their computer systems will not have an adverse effect on us.
However, we do not believe that Year 2000 compliance issues of such third
parties will result in a material adverse effect on our financial condition or
results of operations. We have only one vendor, Thor America, Inc., a
subsidiary of Thor Industries, Inc., upon which we rely upon substantially for
our operations. Thor disclosed in its 10Q for the quarter ended April 30,
1999, that its computer systems are 76% Y2K compliant, and that it intends to
have all systems compliant by July 31, 1999.
PART II - OTHER INFORMATION
Item 1.Legal Proceedings.
On March 1, 1999 Neil Rand d/b/a Corporate Imaging v. Kingsley Coach, Inc.,
et al was filed against Kingsley Coach, Inc.Corporate Imaging ("CI") filed this
lawsuit against Kingsley Coach, Inc. ("Kingsley") in the Supreme Court of
Maricopa County, Arizona. CI alleges that Russell Ratliff, on behalf of
Kingsley, contracted with CI for CI to provide certain "management services" in
exchange for 15,000 shares of free trading Kingsley common stock. CI further
alleges that Kingsley failed to pay CI the 15,000 shares of stock. CI seeks
approximately $52,000 in damages, plus attorney fees.
Kingsley maintains that Ratliff had no authority to execute on behalf of
Kingsley any contract with CI. Kingsley further maintains that CI did not
provide any service. Kingsley has joined Ratliff as a third-party defendant.
This matter is currently set for trial in May, 2000.
Item 2.Changes in Securities.
None; not applicable.
Item 3.Defaults Upon Senior Securities.
None; not applicable.
Item 4.Submission of Matters to a Vote of Security Holders.
None; not applicable.
Item 5.Other Information.
None; not applicable.
Item 6.Exhibits and Reports on Form 8-K.
(a)Exhibits.*
[S] [C]
Where Incorporated
in this Report
--------------
(i)
Amendment to Report on Material or Part I
Corporate Events on Form 8-K/A,
as filed on January 12, 1999**
Amendment to Report on Material or Part I
Corporate Events on Form 8-K/A,
as filed on March 3, 1999**
Exhibit Number Description
- --------------- -----------
(27) Financial Date Schedule.
(b)Reports on Form 8-K.
**This exhibit has previously been filed with the Securities and
Exchange Commission.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf
by the undersigned thereunto duly authorized.
KINGSLEY COACH, INC.
Date: 12-17-99 By /S/Ralph Dickenson
---------------------
Ralph Dickenson, Chairman and President
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 87,841
<SECURITIES> 0
<RECEIVABLES> 22,959
<ALLOWANCES> 0
<INVENTORY> 847,636
<CURRENT-ASSETS> 958,436
<PP&E> 98,682
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,060,768
<CURRENT-LIABILITIES> 2,357,884
<BONDS> 0
0
0
<COMMON> 114
<OTHER-SE> (1,297,002)
<TOTAL-LIABILITY-AND-EQUITY> 1,060,768
<SALES> 133,306
<TOTAL-REVENUES> 133,306
<CGS> 128,211
<TOTAL-COSTS> 252,232
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 24,923
<INCOME-PRETAX> (272,060)
<INCOME-TAX> 0
<INCOME-CONTINUING> (272,060)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (272,060)
<EPS-BASIC> (.02)
<EPS-DILUTED> (.02)
</TABLE>
