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 September 30, 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 September 30, 1999, the number of shares outstanding of the Registrant's
Common Stock was 6,802,100.
<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 September 30, 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, and most recent two quarters of the current fiscal year. Its
recorded "operating expenses" of $21,709 consist of corporate maintenance
expenses, legal, professional, certificate and transfer agency, accounting,
auditing and interest. This Issuer has no business or productive assets and
remains essentially dormant, its activities limited to maintaining its corporate
franchise in Texas, and making required periodic filings and disclosure. The
Issuer has no assets or revenue. The Issuer has no present capital resource and
accordingly no liquidity. It has accrued liabilities of $108,631, of which
$67,039 is principal, and $41,592 is accrued interest.
(b) Plan of Operation. The Company is a candidate for a business combination,
joint venture, or structured acquisition, which, if effective, would create
profitability for the Company and its shareholders.
(c) Reverse Acquisitions. A reverse acquisition is one in which a private
business is acquired by a public corporation in exchange for a transfer of
control of the public company to the owners of the private targeted acquisition
company. The public company acquires the private company, in form, but the
private company acquires the public company in substance. This corporation, by
its very nature and current status, is a potential participant in one or more
reverse acquisition transactions, at some undetermined future time. There are no
present activities, discussions or negotiations, planned or in progress, with
any entity or interest group, for any direct or reverse acquisitions, or
business combinations, of any kind.
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
Exhibit QF 99 #3 Financial Statements (Un-Audited) September 30, 1999
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Form 10-Qsb Report for the Quarter ended September 30, 1999, has been signed
below by the following person on behalf of the Registrant and in the capacity
and on the date indicated.
September 30, 1999
Colonial Industries, Inc.
formerly Impact Energy, Inc.
by
/s/ /s/
- ----------------------------------- -----------------------------------
Joe Kane Jack Wells
PRESIDENT/DIRECTOR SECRETARY/TREASURER
3
<PAGE>
Exhibit QF 99 #3
UN-AUDITED FINANCIAL STATEMENTS
for the Nine Months Ended
September 30, 1999 & 1998
4
<PAGE>
COLONIAL INDUSTRIES, INC.
BALANCE SHEETS (UNAUDITED)
for the nine months ended September 30, 1999 and 1998
<TABLE>
<CAPTION>
September 30, September 30,
1999 1998
------------ ------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash $ -0- -0-
TOTAL CURRENT ASSETS -0- -0-
------------ ------------
TOTAL ASSETS $ -0- $ -0-
============ ============
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 67,039 $ 48,932
Accrued interest 42,816 34,252
------------ ------------
Total Current Liabilities 109,855 83,184
------------ ------------
STOCKHOLDERS' EQUITY
Common Stock, no par value; authorized 75,000,000
shares of no par value, issued and outstanding; 13,110,115
6,802,434, 6,802,434 ans 999 shares respectively
Additional paid-in Capital (Discount on stock) (47,132)
Accumulated Surplus (Deficit) (62,723) (13,193,299)
------------ ------------
Total Stockholders' Equity (109,855) (83,184)
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ -0- $ -0-
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
page F-1
<PAGE>
COLONIAL INDUSTRIES, INC.
STATEMENTS OF LOSS AND ACCUMULATED DEFICIT (UNAUDITED)
for the nine months ended September 30, 1999 and 1998
<TABLE>
<CAPTION>
September 30, September 30, Cumulative
1999 1998 Amounts
------------ ------------ ------------
<S> <C> <C> <C>
REVENUES $ -0- $ -0- $ -0-
------------ ------------ ------------
EXPENSES
Professional fees 15,787 15,787
Transfer Agent 2,267 2,267
Accountant 1,208 1,208
Interest Expense 3,671 2,447 40,368
------------ ------------ ------------
Total Operating Expense 22,933 2,447 59,630
------------ ------------ ------------
NET INCOME (LOSS) $ (22,933) $ (2,447) $ (59,630)
============ ============ ============
NET (LOSS) PER SHARE $ (0.00337) $ (0.00003) $ (0.00080)
============ ============ ============
Weighted average shares outstanding 6,802,434 74,955,530 74,955,530
============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
page F-2
<PAGE>
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 nine months ended September 30, 1999
<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 999 $ 13,110,115 $ $(13,159,047)
stage - January 1, 1990
Net Loss December 31, 1990-1997 (34,252)
------------ ------------ ------------ ------------
Balance December 31, 1997 999 13,110,115 0 (13,193,299)
Fractional shares from stock split 1,435
Shares issued for acquisition of
Colonial Industries and reorganization 6,800,000 (13,110,115) (48,932) 13,159,047
Net Loss December 31, 1998 (5,538)
------------ ------------ ------------ ------------
Balance December 31, 1998 6,802,434 (48,932) (39,790)
Cash received in 1999 as compensation for
1,800,000 shares issued in 1998 for
acquisition of Colonial Industries and 1,800
reorganization @ $0.001 each
Net (Loss) for the period ended
June 30, 1999 (22,933)
------------ ------------ ------------ ------------
Balance at September 30, 1999 6,802,434 $ 0 $ (47,132) $ (62,723)
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
page F-3
<PAGE>
COLONIAL INDUSTRIES, INC.
STATEMENTS OF CASH FLOW (UNAUDITED)
for the nine months ended September 30, 1999 and 1998
<TABLE>
<CAPTION>
September 30, September 30, Cumulative
1999 1998 Amounts
------------- ------------- ----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss) $(22,933) $(4,893) $(62,723)
Add item not requiring the use of cash 3,671 4,893 43,461
-------- ------- --------
Net use of cash from operating activities (19,262) -0- (19,262)
-------- ------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Issuance of common stock 1,800
Increase (decrease) in accounts payable 17,462
NET INCREASE IN CASH
CASH AT BEGINNING OF PERIOD -0- -0- -0-
-------- ------- --------
CASH AT END OF PERIOD $-0- $-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
September 30, 1999 and 1998
NOTE I - Summary of Significant Accounting Policies
a. Organization
Colonial Industries, Inc. ("the Company) formerly known as Impact
Energy, Inc., (a Colorado corporation organized on April 1, 1980) 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 with the Texas corporation being the survivor. Then on the same
date, the Company merged with Colonial Industries, Inc. a Texas corporation
on April 22, 1998 and changed the name of the Company to Colonial
Industries, Inc. Colonial 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.
<PAGE>
Colonial Industries, Inc.
(a Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 1999 and 1998
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
September 30, 1999 and December 31, 1998 and 1997. September 30, 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
September 30, 1999 and 1998
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 September 30, 1999.
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<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JUL-01-1999
<PERIOD-END> SEP-30-1999
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<SECURITIES> 0
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0
0
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<EPS-DILUTED> (0.00)
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