FORM 10-KSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934 (FEE REQUIRED)
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
Commission File Number: 0-9562
Impact Energy, Inc.
(Exact name of Registrant as specified in its charter)
Colorado 84-0818655
(Jurisdiction of Incorporation) (I.R.S. Employer Identification No.)
PO Box 980459, Houston Texas 77098-0459
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(713) 526-8224
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None:
Yes[ ] No[x] (Indicate by check mark whether the 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.)
Not[X] (Indicate by check mark whether if disclosure of delinquent filers
(ss.229.405) is not and will not to the best of Registrant's knowledge be
contained herein, in definitive proxy or information statements incorporated
herein by reference or any amendment hereto.)
As of December 31, 1997, the aggregate number of shares held by non-affiliates
was approximately 33,931,739 shares. Due to the limited market for the Company
securities, no estimate is being supplied herewith of the market value for such
securities.
As of December 31, 1997, the number of shares outstanding of the Registrant's
Common Stock was 74,955,530.
Exhibit Index is found on page 7
Form 10-KSB
Exhibit Index is on page 7
Impact Energy, Inc. December 31, 1997 Sequential Page 1
<PAGE>
- --------------------------------------------------------------------------------
PART I
- --------------------------------------------------------------------------------
Item 1. Business.
(a) Organization of the Issuer.
Impact Energy, Inc. is a Colorado corporation organized April 1, 1980,
originally formed to engage in exploration for, development and sale of, oil and
gas. On or about September 6, 1980, the Company made its initial private
placement of 14,075,000 of its no par common stock for cash, services and
property. In February 1981, the Company completed its initial public offering of
13,750,000 shares of common stock, of no par value. During 1987, the Company
issued 6,466,996 for Southwest Sites, Inc. In 1988, the Company repurchased
3,486,800 shares, and, during May, 1988, the Company completed a private
placement of 44,176,804 restricted unregistered common stock, for a total issued
and outstanding of 75,000,000 shares. It was determined that 44,470 previously
issued but undelivered shares had not been paid for, and were returned for
cancellation, with the resulting total issued and outstanding 74,955,530 shares
of common stock, issued and outstanding, as of the date of this report.
(b) The Business of Registrant.
Impact Energy, Inc. is a Colorado corporation organized April 1, 1980,
originally formed to engage in exploration for, development and sale of, oil and
gas. During March of 1988, Impact contributed all its producing oil and gas
properties to Southwest Sites, Inc., and distributed the ownership of Southwest
to the shareholders of Impact. After the disposition, Impact began pursuing
investment opportunities in the financial services industry. Impact made public
announcements during 1988 of its intention to pursue the acquisition of failed
Banks and Savings and Loans, in the State of Texas. No acquisitions were made in
1988, although Impact did provide funding with respect to two Texas Banks. The
Company became inactive in 1989 and has remained so to date.
(c) Employees and Facilities.
The Company has no employees or facilities, and enjoys the non-exclusive
office services of its President and Majority Shareholder.
Item 2. Facilities.
The Company has no employees or facilities, and enjoys the non-exclusive
office services of its Officers and Principal Shareholders.
Form 10-KSB
Exhibit Index is on page 7
Impact Energy, Inc. December 31, 1997 Sequential Page 2
<PAGE>
Item 3. Legal Proceedings.
There are no legal or other proceedings pending against the Company, as of
the preparation of this Report, and no facts are known or suspected which would
give rise to any anticipation of any such proceedings in the foreseeable future.
Item 4. Submission of Matters to a Vote of Security Holders.
There have been no matters submitted to a vote of shareholders during the
annual period covered by this report.
PART II
Item 5. Market for Common Equity and Stockholder Matters.
(a) Market Information.
The Registrant Company has one class of securities, No Par Common Stock
("Common Stock"). As of the date of this Annual Report, the securities of the
Issuer are not traded over the counter or on any trading exchange. It is
foreseeable that the common stock of this issuer may be traded in the
foreseeable future over the counter. If so shareholders and the public would
experience a young, sporadic and potentially volatile trading market for them.
Quotations for, and transactions in the Securities so traded are capable of
rapid fluctuations, resulting from the influence of supply and demand on
relatively thin volume. There may be buyers at a time when there are no sellers,
and sellers when there are no buyers, resulting in significant variations of bid
and ask quotations by market-making dealers, attempting to adjust changes in
demand and supply. A young market is also particularly vulnerable to "short
selling", sell orders by persons owning no shares of stock, but intending to
drive down the market price so as to purchase the shares to be delivered at a
price below the price at which the shares were sold "short". Such future and
foreseeable trading may not occur. There is no assurance of any future trading
in or of the securities of this Issuer.
Of the Company's issued and outstanding 74,955,530 shares of Common Stock
as of December 31, 1998, there stands of record 11,728,620 unrestricted
free-trading, and 63,226,910 issued as Restricted Securities. Many of these
latter shares, so issued, have been held continuously by non-affiliates for more
than two years, and are no longer Restricted Securities, as defined by Rule
144(a) promulgated by the Securities and Exchange Commission pursuant to ss.3(b)
of the Securities Act of 1933, and might be re-sold in compliance with Rule 144,
in brokerage transactions, at such time as there may be trading in the common
stock of this Issuer. Rule 144 provides among other things and subject to
certain limitations that a person holding "Restricted Securities" for a period
of two years, who is not an affiliate of the Issuer, may sell those securities,
free of restriction in brokerage transactions. Further, shares issued pursuant
to 1933 Act Registration, again subject to exceptions for affiliate ownership,
are not "Restricted Securities" and are freely tradeable in brokerage
transaction. Affiliates are permitted by Rule 144 to sell affiliate-owned
securities (Restricted Securities held for more than one year and Registered
Affiliate Control Securities however long held) in limited amounts. Possible or
actual sales of the Company's Common Stock under Rule 144 or otherwise might
have a depressive effect upon the price of the Company's
Form 10-KSB
Exhibit Index is on page 7
Impact Energy, Inc. December 31, 1997 Sequential Page 3
<PAGE>
Common Stock, at such time, if and when the common stock of this Issuer might be
tradeable in brokerage transactions.
(b) Holders.
Management calculates that the approximate number of holders of the
Company's Common Stock, as of December 31, 1997 was 1,167.
(c) Dividends.
No cash dividends have been paid by the Company on its Common Stock and no
such payment is anticipated in the foreseeable future. No other dividends have
been paid or declared by the Issuer and none are anticipated.
Item 6. Selected Financial Data.
The following information is provided as of the Date of this Report:
================================================================================
December 31, 1997 1997 1996 1995
================================================================================
Total Assets 0 0 0
- --------------------------------------------------------------------------------
Revenues 0 0 0
- --------------------------------------------------------------------------------
Operating Expenses 4,893 4,893 4,893
- --------------------------------------------------------------------------------
Net Earnings or (Loss) (4,893) (4,893) (4,893)
- --------------------------------------------------------------------------------
Per Share Earnings
or (Loss) (-) (-) (-)
- --------------------------------------------------------------------------------
Average Common Shares
Outstanding 74,955,530 74,955,530 74,955,530
================================================================================
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
(a) Results of Operations.
The Issuer (and its wholly-owned subsidiary) has no current business, and
has had no operations in the last fiscal year.
(b) Liquidity and Capital Resources.
The Issuer (and its wholly-owned subsidiary) has no capital resource and no
liquidity. (Reference is made to Auditors Report of July 31, 1998, December 31,
1997, and 1996, filed herewith.
Form 10-KSB
Exhibit Index is on page 7
Impact Energy, Inc. December 31, 1997 Sequential Page 4
<PAGE>
(c) Plan of Operation. The Company is seeking a business opportunity, in the
nature of a business combination, joint venture, or structured acquisition,
which, if effective, would create profitability for the Company and its
shareholders.
Item 8. Financial Statements and Supplementary Data.
Auditors Report of July 31, 1998 is filed herewith. Those financial
statements, attached thereto are incorporated herein by this reference as though
fully set forth herein. By virtue of the late filing of this Report, the
Auditors Report includes information through July 31, 1998.
Item 9. Change of Registrant's Auditor.
The last previous Audit, conducted for the Registrant, was dated May 11,
1989, for the years ended December 31, 1988, 1987 and 1986. Todd D. Chisholm,
CPA, and the firm of Crouch, Bierwolf & Chisholm, has been retained to provide,
and has provided the current Auditor's report. There has been no disagreement or
dispute of any kind or sort with any auditor as to any matter.
PART III
Item 10. Directors and Executive Officers.
The Directors and Executive Officers of the Company are set forth below.
All Officers and Directors shall serve until the next meeting of shareholders or
until their successors be elected or appointed.
JACK WELLS President/Director
JOE KANE Secretary/Director
Item 11. Executive Compensation.
Officers, Directors and Management of this Issuer presently serve without
compensation.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
COMMON STOCK
To the best of Registrant's knowledge and belief the following disclosure
presents, as of the date of this report, December 31, 1997, the total beneficial
security ownership of all Directors and Nominees,
Form 10-KSB
Exhibit Index is on page 7
Impact Energy, Inc. December 31, 1997 Sequential Page 5
<PAGE>
naming them, and by all Officers and Directors as a group, without naming them,
of Registrant, known to or discoverable by Registrant, and the total security
ownership of all persons, entities and groups, known to or discoverable by
Registrant, to be the beneficial owner or owners of more than five percent of
any voting class of Registrant's stock. More than one person, entity or group
could be beneficially interested in the same securities, so that the total of
all percentages may accordingly exceed one hundred percent. Registrant has only
one class of stock, namely Common Voting Equity Shares.
SECURITY OWNERSHIP OF OFFICERS AND DIRECTORS AND 5% OWNERS
<TABLE>
<CAPTION>
==========================================================================================================
Name and Address of Beneficial Owner Amount and Nature Percent
of Ownership of Class
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Jack Wells president/director -0- 0.00
PO Box 980459
Houston Texas 77098-0459
- ----------------------------------------------------------------------------------------------------------
Joe Kane secretary/director -0- 0.00
PO Box 980459
Houston Texas 77098-0459
==========================================================================================================
All Officers and Directors as a Group 0 0.00
==========================================================================================================
T.M. Skillern (1) 14,400,000 19.21
PO Box 980459
Houston Texas
- ----------------------------------------------------------------------------------------------------------
R. Ray Rankin (1) 16,046,996 21.41
5700 Bentree
Coreyville TX 76034
- ----------------------------------------------------------------------------------------------------------
James S. Clifton (1) 10,576,804 14.11
5335 Desota-D
Houston TX 77091
==========================================================================================================
Total Shares Issued and Outstanding 74,955,530 100.00
==========================================================================================================
</TABLE>
(1) For purposes of this Report the share ownership of family members with the
same surnames have been attributed to the named shareholder, without regard to
same or separate addresses, and without any investigation of actual relationship
or current affiliation.
Item 13. Certain Relationships and Related Transactions.
None.
Form 10-KSB
Exhibit Index is on page 7
Impact Energy, Inc. December 31, 1997 Sequential Page 6
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) Financial Statements. Reference is made to Auditors Report of July 31,
1998 and December 31, 1997, and 1996, filed with
herewith. Those financial statements, attached as
Exhibit "F" thereto are incorporated herein by this
reference as though fully set forth herein.
(b) Form 8-K Reports. No Reports on Form 8-K were filed during the last
quarter covered by this Annual Report.
(c) Exhibits. Please see Exhibit Index, following.
Exhibit Index
Financial Statements and Documents
Furnished as a part of this Annual Report
Exhibit F. Audited Financial Statements - July 31, 1998,
December 31, 1997 and 1996.
Form 10-KSB
Exhibit Index is on page 7
Impact Energy, Inc. December 31, 1997 Sequential Page 7
<PAGE>
---------------
Supplementary Information to be Furnished With
Reports Filed Pursuant to Section 15(d) of the Act by
Registrants which Have Not Registered Securities
Pursuant to Section 12 of the Act.
No annual report or proxy material has been sent to security holders.
---------------
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the individual capacities and on the date indicated.
Dated: January 16, 1998
Impact Energy, Inc.
A COLORADO CORPORATION
by
/s/ Jack Wells /s/ Joe Kane
- ----------------------- -----------------------
Jack Wells Joe Kane
PRESIDENT/DIRECTOR SECRETARY/TREASURER
Form 10-KSB
Exhibit Index is on page 7
Impact Energy, Inc. December 31, 1997 Sequential Page 8
<PAGE>
- --------------------------------------------------------------------------------
Exhibit F
Audited Financial Statements - December 31, 1998, 1997 and 1996.
- --------------------------------------------------------------------------------
<PAGE>
Impact Energy, Inc.
(a Development Stage Company)
Consolidated Financial Statements
July 31, 1998, December 31, 1997 and 1996
<PAGE>
C O N T E N T S
Accountants' Report ....................................................... 3
Consolidated Balance Sheets ............................................... 4
Consolidated Statements of Operations ..................................... 5
Consolidated Statements of Stockholders' Equity ........................... 6
Consolidated Statements of Cash Flows ..................................... 7
Notes to the Consolidated Financial Statements ........................... 8
<PAGE>
[CROUCH, BIERWOLF & CHISHOLM LETTERHEAD]
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders of
Impact Energy, Inc.
We have audited the accompanying consolidated balance sheets of Impact Energy,
Inc. (a Development Stage Company) as of July 31, 1998, December 31, 1997 and
1996 and the related consolidated statements of operations, stockholders' equity
and cash flows for the seven months ended July 31, 1998 and the years ended
December 31, 1997, 1996 and 1995. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Impact Energy, Inc.
(a Development Stage Company) as of July 31, 1998, December 31, 1997 and 1996
and the results of its operations and cash flows for the seven months ended July
31, 1998 and the years ended December 31, 1997, 1996 and 1995 in conformity with
generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has no assets and no operations and is
dependent upon financing to continue operations. These factors raise substantial
doubt about its ability to continue as a going concern. Management's plans in
regard to these matters are also described in the Note 2. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
/s/ CROUCH, BIERWOLF & CHISHOLM
Salt Lake City, Utah
August 26, 1998
- --------------------------------------------------------------------------------
MEMBER AMERICAN INSTITUTE OF CPAS, SEC PRACTICE SECTION,
AND UTAH ASSOCIATION OF CPAS
<PAGE>
Impact Energy, Inc.
(a Development Stage Company)
Consolidated Balance Sheets
Assets
<TABLE>
<CAPTION>
July 31, December 31,
------------ ----------------------------
1998 1997 1996
------------ ------------ ------------
<S> <C> <C> <C>
Current assets
Cash $ -- $ -- $ --
------------ ------------ ------------
Total Current Assets -- -- --
------------ ------------ ------------
Total Assets $ -- $ -- $ --
============ ============ ============
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable 48,932 48,932 48,932
Accrued interest 37,106 34,252 29,359
------------ ------------ ------------
Total Current Liabilities 86,038 83,184 78,291
------------ ------------ ------------
Stockholders' Equity
Common Stock, authorized
75,000,000 shares of no par value,
issued and outstanding 74,955,530
shares respectively -- 749,555 749,555
Additional Paid in Capital/(Discount on stock) (48,932) 12,360,560 12,360,560
Deficit Accumulated During the
Development Stage (37,106) (13,193,299) (13,188,406)
------------ ------------ ------------
Total Stockholders' Equity (86,038) (83,184) (78,291)
------------ ------------ ------------
Total Liabilities and Stockholders' Equity $ -- $ -- $ --
============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements
4
<PAGE>
Impact Energy, Inc.
(a Development Stage Company)
Consolidated Statements of Operations
<TABLE>
<CAPTION>
For the Deficit
Seven Months Accumulated
Ended For the years ended December 31, during the
July 31, -------------------------------------------- development
1998 1997 1996 1995 Stage
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Revenues: $ -- $ -- $ -- $ -- $ --
Expenses:
Interest Expense 2,854 4,893 4,893 4,893 37,106
------------ ------------ ------------ ------------ ------------
Total Expenses 2,854 4,893 4,893 4,893 37,106
------------ ------------ ------------ ------------ ------------
Net (Loss) $ (2,854) $ (4,893) $ (4,893) $ (4,893) $ (37,106)
============ ============ ============ ============ ============
Net Loss Per Share $ (--) $ (--) $ (--) $ (--) $ (--)
============ ============ ============ ============ ============
Weighted average shares outstanding 74,955,530 74,955,530 74,955,530 74,955,530 74,955,530
============ ============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements
5
<PAGE>
Impact Energy, Inc.
(a Development Stage Company)
Consolidated Statement of Stockholders' Equity
<TABLE>
<CAPTION>
Additional Deficit
Paid-in Accumulated
Capital During the
Common Stock (Discount on Development
Shares Amount Stock) Stage
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Balance at beginning of development
stage - January 1, 1990 74,955,530 $ 749,555 $ 12,360,560 $(13,159,047)
Net loss December 31, 1990-1994 -- -- -- (19,573)
Net loss December 31, 1995 -- -- -- (4,893)
Net loss December 31, 1996 -- -- -- (4,893)
------------ ------------ ------------ ------------
Balance, December 31, 1996 74,955,530 749,555 12,360,560 (13,188,406)
Net loss December 31, 1997 -- -- -- (4,893)
------------ ------------ ------------ ------------
Balance, December 31, 1997 74,955,530 749,555 12,360,560 (13,193,299)
Reorganization - April 28, 1998 -- (749,555) (12,311,628) 13,159,047
Net loss for the seven months ended
July 31, 1998 -- -- -- (2,854)
------------ ------------ ------------ ------------
Balance, July 31, 1998 74,955,530 $ -- $ (48,932) $ (37,106)
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements
6
<PAGE>
Impact Energy, Inc.
(a Development Stage Company)
Consolidated Statement of Cash Flows
<TABLE>
<CAPTION>
January 1,
For the 1990 (inception
Seven of the
Months development
Ended For the years ended December 31, stage) to
July 31, ------------------------------------ July 31,
1998 1997 1996 1995 1998
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Cash Flows form Operating
Activities
Net loss $ (2,854) $ (4,893) $ (4,893) $ (4,893) $(37,106)
Adjustments to reconcile
net loss to net cash
provided by operations
Accrued expenses 2,854 4,893 4,893 4,893 37,106
-------- -------- -------- -------- --------
Net Cash Flows used in
Operating Activities -- -- -- -- --
-------- -------- -------- -------- --------
Cash Flows from Investment
Activities: -- -- -- -- --
Cash Flows from Financing
Activities: -- -- -- -- --
Net increase (decrease) in cash -- -- -- -- --
Cash, beginning of year -- -- -- -- --
-------- -------- -------- -------- --------
Cash, end of year $ -- $ -- $ -- $ -- $ --
======== ======== ======== ======== ========
Supplemental Cash Flow Information
Cash Paid for:
Interest $ -- $ -- $ -- $ -- $ --
Taxes $ -- $ -- $ -- $ -- $ --
</TABLE>
The accompanying notes are an integral part of these financial statements
7
<PAGE>
Impact Energy, Inc.
(a Development Stage Company)
Notes to The Consolidated Financial Statements
July 31, 1998, December 31, 1997 and 1996
NOTE 1 - Summary of Significant Accounting Policies
a. Organization
Impact Energy, Inc., ("the Company") is a Colorado corporation
organized on April 1, 1980. Impact was originally formed to engage in
exploration for, and development, production and sale of, oil and gas.
During March, 1988 Impact contributed all its producing oil and gas
properties to Southwest Sites Inc. and distributed the Ownership of
Southwest to Impact's shareholders. After the disposition of the oil and
gas properties, Impact began pursuing investment opportunities in the
financial services industry.
Impact made public announcements during 1988 stating its intent to
pursue the acquisition of failed Banks and Savings and Loans in the state
of Texas. No acquisitions were made in 1988 although Impact did provide the
financing for the recapitalization of one Texas bank and provide the
capital to refinance the control group of another.
The Company went inactive in 1989 and has been dormant ever since.
On April 23, 1998, the Company merged with Impact Energy, Inc. a Texas
corporation organized on April 22, 1998. The Texas corporation has
75,000,000 no par value shares authorized, and a share for share exchange
took place. A reorganization adjustment was made on the books and records
and the retained deficit was eliminated.
b. Accounting Method
The Company recognizes income and expenses on the accrual basis of
accounting.
c. Earnings (Loss) Per Share
The computation of earnings per share of common stock is based on the
weighted average number of shares outstanding at the date of the financial
statements.
d. Cash and Cash Equivalents
The Company considers all highly liquid investments with maturities of
three months or less to be cash equivalents.
8
<PAGE>
Impact Energy, Inc.
(a Development Stage Company)
Notes to the Consolidated Financial Statements
July 31, 1998, December 31, 1997 and 1996
NOTE 1 - Summary of Significant Accounting Policies (Continued)
e. Provision for Income Taxes
No provision for income taxes has been recorded due to net operating
loss carryforwards totaling approximately $1,700,000 that will be offset
against future taxable income. These NOL carryforwards have already begun
to expire. No tax benefit has been reported in the financial statements
because the Company believes there is a 50% or greater chance the
carryforward will expire unused.
Deferred tax assets and the valuation account is as follows at July
31, 1998 and December 31, 1997 and 1996.
July 31, December 31,
1998 1997 1996
--------- --------- ---------
Deferred tax asset:
NOL carrryforward $ 578,000 $ 578,000 $ 578,000
Valuation allowance (578,000) (578,000) (578,000)
--------- --------- ---------
Total $ -- $ -- $ --
========= ========= =========
f. Use of estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the
financial statements and revenues and expenses during the reporting period.
In these financial statements, liabilities involve extensive reliance on
management's estimates. Actual results could differ from those estimates.
g. Principles of Consolidation
The Consolidated Financial Statements include the accounts of Impact
Energy, Inc. a Colorado corporation and its wholly owned subsidiary Impact
Energy, Inc. a Texas corporation. All intercompany accounts and
transactions have been eliminated in the consolidation.
NOTE 2 - Going Concern
The accompanying financial statements have been prepared assuming that
the Company will continue as a going concern. The Company has no assets and
no operating activity and is dependent upon financing to continue
operations. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty. It is management's plan
to find an operating company to merge with providing necessary operating
capital.
NOTE 3 - Development Stage Company
The Company is a development stage company as defined in Financial
Accounting Standards Board Statement No. 7. It is concentrating
substantially all of its efforts in raising capital and developing its
business operations in order to generate significant revenues. Management
has elected to use January 1, 1990 as the date the Company began the
development stage.
9
<PAGE>
Impact Energy, Inc.
(a Development Stage Company)
Notes to the Consolidated Financial Statements
July 31, 1998, December 31, 1997 and 1996
NOTE 4 - Liens and Judgements
The Company has two tax liens and one outstanding judgement. Taxes are
owed to the IRS and the State of Texas in the amount of $9,812. An
outstanding judgement of $39,120 is also outstanding on the records of the
County Clerk of Dallas County, Texas. These liabilities are reflected on
the records as accounts payable and estimated accrued interest on these
obligations have also been recorded through July 31, 1998.
10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 83,184
<BONDS> 0
0
0
<COMMON> 749,555
<OTHER-SE> (832,739)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,893
<INCOME-PRETAX> (4,893)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,893)
<EPS-PRIMARY> (0.00)
<EPS-DILUTED> (0.00)
</TABLE>
