FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended March 31, 1999
AND
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 0-9562
Colonial Industries, Inc.
formerly Impact Energy, Inc.
(Exact name of Registrant as specified in its charter)
Texas 84-0818655
(Jurisdiction of Incorporation) (I.R.S. Employer Identification No.)
2284 West Holcombe, Houston Texas 77030
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 526-8223
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Yes [X] No [ ] (Indicate by check mark whether the Registrant (1) has filed all
report 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.)
As of March 31, 1999, the number of shares outstanding of the Registrant's
Common Stock was 6,802,434.
<PAGE>
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements
Attached hereto and incorporated herein by this reference are consolidated
unaudited financial statements for the Quarter ended March 31, 1999, as Exhibit
QF 99 #3.
Item 2. Management's Discussion and Analysis of
Financial Condition and Plan of Operations
(a) Management's Discussion and Analysis of Financial Condition and Results of
Operations
The Issuer has no current business, and has had no operations in the last
fiscal year. The Issuer has no assets or revenue, and has accrued liabilities of
$81,961. The Issuer has no present capital resource and accordingly no
liquidity.
(b) Plan of Operation
The Issuer has no alternative but to pursue the possibility of one or more
potential business combinations to achieve profitability for its shareholders.
PART II: OTHER INFORMATION
Item 5. Other Information
Colonial Industries, Inc., formerly Impact Energy, Inc., is a Texas
corporation, originally a Colorado corporation organized April 1, 1980, 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.
Item 6. Exhibits and Reports on Form 8-K
Exhibit QF #3 Financial Statements (Un-Audited) March 31, 1999
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Form 10-Qsb Report for the Quarter ended March 31, 1999, has been signed below
by the following person on behalf of the Registrant and in the capacity and on
the date indicated.
March 31, 1999
Colonial Industries, Inc.
formerly Impact Energy, Inc.
by
/s/ Jack Wells /s/ Joe Kane
- ------------------------------ ------------------------------
Jack Wells Joe Kane
PRESIDENT/DIRECTOR SECRETARY/TREASURER
3
<PAGE>
Exhibit QF 99 #1
UN-AUDITED FINANCIAL STATEMENTS
for the Three Months Ended
March 31, 1999
4
<PAGE>
<TABLE>
COLONIAL INDUSTRIES, INC.
BALANCE SHEETS (UNAUDITED)
for the fiscal years ended December 31, 1997 and 1998
and the three months ended March 31, 1999
<CAPTION>
December 31,
March 31, ----------------------------
1999 1998 1997
------------ ------------ ------------
ASSETS
<S> <C> <C> <C>
CURRENT ASSETS
Cash $ 57 $ 57 -0-
TOTAL CURRENT ASSETS 57 57 -0-
------------ ------------ ------------
TOTAL ASSETS $ 57 $ 57 -0-
============ ============ ============
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 48,932 $ 48,932 $ 48,932
Accrued interest 40,368 39,145 34,252
------------ ------------ ------------
Total Current Liabilities 89,300 88,077 83,184
------------ ------------ ------------
STOCKHOLERS' EQUITY
Common Stock, no par value; authorized 75,000,000
shares; issued and outstanding, 6,802,100 shares, 26,976,068 26,976,068 749,555
Additional paid-in Capital 0 0 12,360,560
Accumulated Surplus (Deficit) (65,311) (64,088) (13,193,299)
------------ ------------ ------------
Total 26,910,757 26,911,980
------------ ------------
Less: Subscriptions receivable (27,000,000) (27,000,000)
Total Stockholders' Equity (89,243) (88,020) (83,184)
------------ ------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 57 $ 57 $ 0
============ ============ ============
</TABLE>
The accompanying notes are an integral part
of these financial statements.
page F-1
<PAGE>
<TABLE>
<CAPTION>
COLONIAL INDUSTRIES, INC.
STATEMENTS OF LOSS AND ACCUMULATED DEFICIT (UNAUDITED)
for the fiscal years ended December 31, 1997 and 1998
and the three months ended March 31, 1999
<CAPTION>
December 31,
March 31, --------------------------------------- Cumulative
1999 1998 1997 Amounts
------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
REVENUES $ -0- $ -0- $ -0- $ -0-
------------------ ------------------ ------------------ ------------------
EXPENSES
Auditor fees 800 800
Incorporation costs (Texas) 620 620
Miscellaneous phone, fax, fedex, etc. 2,500 2,500
Professional fees 5,470 5,470
SEC filing fees 1,800 1,800
Transfer agency fees 11,268 11,268
Travel 2,485 2,485
Interest Expense 1,223 4,893 4,893 37,933
------------------ ------------------ ------------------ ------------------
Total Operating Expense 1,223 29,836 4,893 62,876
------------------ ------------------ ------------------ ------------------
NET INCOME (LOSS) $ 1,223 $ 29,836 $ 4,893 $ 62,876
================== ================== ================== ==================
NET (LOSS) PER SHARE $ (0.00018) $ (0.00439) $ (0.00007) $ (0.00084)
================== ================== ================== ==================
Weighted average shares outstanding 6,802,434 6,802,100 74,955,530 74,955,530
================== ================== ================== ==================
</TABLE>
The accompanying notes are an integral part
of these financial statements.
page F-2
<PAGE>
<TABLE>
COLONIAL INDUSTRIES, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (UNAUDITED)
for the period from inception of the Development Stage on January 1, 1990,
for the fiscal years ended December 31, 1991, through 1998
and for the three months ended March 31, 1999
<CAPTION>
Additional Deficit
Paid-in Accumulated
Capital During the
Common Stock (Discount on Subscriptions Development
Shares Amount Stock) Receivable Stage
--------------- ------------- --------------- ----------------- ----------------
<S> <C> <C> <C> <C> <C>
Balance at beginning of development 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) (12,409,492) 13,159,047
Common shares reverse split
1 share for 75,000 shares (74,954,531)
Common shares reserved for
rounding up to whole shares 1,101
Common shares issued for cash 5,000,000 25,000
Common shares issued for
subscriptions receivable 1,800,000 27,000,000
Shares issued in roundup 334
Less: subscriptions receivable (27,000,000)
Net (Loss) for the year ended
December 31, 1998 (29,836)
--------------- ------------- --------------- ----------------- ----------------
Balance at December 31, 1998 6,802,434 0 $ 26,976,068 $ (27,000,000) $ (64,088)
Net (Loss) for the period ended
March 31, 1999 (1,223)
--------------- ------------- --------------- ----------------- ----------------
Balance at March 31, 1999 6,802,434 0 $ 26,976,068 $ (27,000,000) $ (65,311)
</TABLE>
The accompanying notes are an integral part
of these financial statements.
page F-3
<PAGE>
<TABLE>
COLONIAL INDUSTRIES, INC.
STATEMENTS OF CASH FLOW (UNAUDITED)
for the fiscal years ended December 31, 1997 and 1998
and the three months ended March 31, 1999
<CAPTION>
December 31,
March 31, ------------------------ Cumulative
1999 1998 1997 Amounts
-------- -------- -------- --------
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss) $ (1,223) $(29,836) $ (4,893) $(38,329)
Add item not requiring the use of cash 1,223 4,893 4,893 38,329
-------- -------- -------- --------
Net use of cash from operating activities 0 (24,943) 0 0
-------- -------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Issuance of common stock 25,000
NET INCREASE IN CASH
CASH AT BEGINNING OF PERIOD 57 0 -0- -0-
-------- -------- -------- --------
CASH AT END OF PERIOD $ 0 $ 57 $ 0 $ 0
======== ======== ======== ========
</TABLE>
The accompanying notes are an integral part
of these financial statements.
page F-4
<PAGE>
Colonial Industries, Inc.
(a Development Stage Company)
Notes to The Consolidated Financial Statements
March 31, 1999, December 31, 1998 and 1997
NOTE I - Summary of Significant Accounting Policies
a. Organization
Colonial Industries, Inc. ("the Company) was incorporated as Impact
Energy, Inc., a Colorado corporation 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
provided 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. In October of 1998
the Company acquired Colonial Industries, Inc. and changed its name to
Colonial Industries, Inc.
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.
<PAGE>
Colonial Industries, Inc.
(a Development Stage Company)
Notes to the Consolidated Financial Statements
March 31, 1999, December 31, 1998 and 1997
NOTE I - Summary of Significant Accounting Policies (Continued)
d. Cash and Cash Equivalents
The Company considers all highly liquid investments with maturities of
three months or less to be cash equivalents.
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 March
31, 1999 and December 31, 1998 and 1997.
March 31, December 31,
1999 1998 1997
--------- --------- ---------
Deferred tax asset:
NOL carrryforward $ 578,000 $ 578,000 $ 578,000
Valuation allowance (578,000) (578,000) (578,000)
--------- --------- ---------
Total -0- -0- -0-
========= ========= =========
f. Use of estimates
The preparation of financial statements is 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.
<PAGE>
Colonial Industries, Inc.
(a Development Stage Company)
Notes to the Consolidated Financial Statements
March 31, 1999, December 31, 1998 and 1997
NOTE I - Summary of Significant Accounting Policies (Continued)
g. Principles of Consolidation
The Consolidated Financial Statements include the accounts of
Colonial Industries, Inc (formerly Impact Energy, Inc.) a Colorado
corporation, its wholly owned subsidiary Impact Energy, Inc. a Texas
corporation and its wholly owned subsidiary Colonial Industries, Inc.
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.
NOTE 4 - Liens and Judgments
The Company has two tax liens and one outstanding judgment. Taxes are
owed to the IRS and the State of Texas in the amount of $9,812. An
outstanding judgment 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 accrued on these
obligations have also been recorded through March 31, 1999.
<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> 57
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 57
<CURRENT-LIABILITIES> 89300
<BONDS> 0
0
0
<COMMON> 26910757
<OTHER-SE> (27000000)
<TOTAL-LIABILITY-AND-EQUITY> 57
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1223
<INCOME-PRETAX> (1223)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1223)
<EPS-PRIMARY> .000
<EPS-DILUTED> .000
</TABLE>
