UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
-------- OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
OR
------- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
------------- -------------
Commission file number 33-853963
THREE-L ENTERPRISES, INC.
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Exact Name of Registrant as Specified in its Charter
Delaware 72-1265159
----------------------------- ---------------------------
State or Other Jurisdiction of IRS Employer Identification
Incorporation or Organization Number
1109 Andrews, Metairie, Louisiana 70005
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(Address of principal executive offices) (Zip Code)
(504) 831-8760
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Registrant's Telephone Number, Including Area Code
N/A
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(Former Name, Former Address and Formal Fiscal Year, if Changed
Since Last Report.)
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.
Yes No X
------- -------
The number of shares outstanding of each of the issuer's classes of
common shares, as of the latest practicable date:
$.0001 Par Value Outstanding at August 31, 1996
Common Shares
44,000
---------------------- ----------------------
Class of Securities Outstanding Securities
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<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
INDEX
Page
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets
June 30, 1996 and December 31, 1995 1
Condensed Statements of Operations
for the three months ended June 30,
1996 and 1995, the six months ended
June 1996 and 1995, and the period
from March 18, 1994 (inception) to
June 30, 1996. 2
Statement of Stockholders' Equity
for the period from March 18, 1994
(inception) to June 30, 1996 3
Condensed Statements of Cash Flows
for the six months ended June 30,
1996 and 1995 and the period from
March 18, 1994 (inception) to
June 30, 1996. 4
Notes to Condensed Financial Statements 5-6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 7
Part II. OTHER INFORMATION 8
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<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
CONDENSED BALANCE SHEET
(Unaudited)
June 30, December 31,
1996 1995
---- ----
ASSETS
------
CURRENT ASSETS:
Cash $ 328 $ 395
OTHER ASSETS:
Deferred offering costs 59,359 36,825
Cash held in escrow 133,110 133,110
---------- ----------
$ 192,797 $ 170,330
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 32,455 $ 4,990
Note payable - officer 7,500 5,000
---------- ----------
Total Liabilities 39,955 9,990
---------- ----------
COMMITMENTS AND CONTINGENCIES
ESCROWED COMMON STOCK 133,110 133,110
---------- ----------
STOCKHOLDERS' EQUITY:
Preferred stock, $.0001 par
value; 25,000,000 shares
authorized; none issued - -
Common stock, $.0001 par
value; 100,000,000 shares
authorized; 44,000 issued
and outstanding 4 4
Additional paid-in capital 35,411 35,411
(Deficit) accumulated during
the development stage (15,683) (8,185)
---------- ----------
Total stockholders' equity 19,732 27,230
---------- ----------
$ 192,797 $ 170,330
========== ==========
Note: The balance sheet at December 31, 1995, has been taken from
the audited financial statements at that date and condensed.
-1-
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<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
March 18,
1994
Three Months Ended Six Months Ended (Inception)
------------------- ----------------- to
June 30, June 30, June 30, June 30, June 30,
1996 1995 1996 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ - $ -
------- ------- ------- ------- --------
EXPENSES:
General and
administrative 3,157 3,097 7,498 4,532 15,683
------- ------- ------- ------- --------
NET (LOSS) $(3,157) $(3,097) $(7,498) $(4,532) $(15,683)
======= ======= ======= ======= =======
NET (LOSS) PER SHARE
OF COMMON STOCK $ (.07) $ (.07) $ (.17) $ (.10)
======= ======= ======= =======
Weighted average
number of common
shares outstanding 44,000 44,000 44,000 44,000
======= ======= ======= =======
</TABLE>
-2-
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<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
For the Period March 18, 1994 (Inception)
To June 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
(Deficit)
Accumulated
Common Stock Additional During The
--------------- Paid-In Development
Shares Amount Capital Stage
------ ------ --------- ----------
<S> <C> <C> <C> <C>
Balances, March 18, 1994
(inception) - $ - $ - $ -
Issuance of common stock
for cash, $.46875 per
share 44,000 4 20,621 -
Net (loss) for period
March 18, 1994
(inception) to
December 31, 1994 - - - (682)
------- ----- -------- --------
Balances, December 31,
1994 44,000 4 20,621 (682)
Net proceeds received
from public offering
(note 2) - - 14,790 -
Net (loss) for the
period - - - (7,503)
------- ----- -------- --------
Balances, December 31,
1995 44,000 4 35,411 (8,185)
Net (loss) for the
period - - - (7,498)
------- ----- -------- --------
Balances, June 30, 1996 44,000 $ 4 $ 35,411 $(15,683)
======= ===== ======== ========
</TABLE>
-3-
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<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
March 18,
1994
Six Months Ended (Inception)
--------------------- to
June 30, June 30, June 30,
1996 1995 1996
---- ---- ----
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net (loss) $ (7,498) $ (4,532) $ (15,683)
(Increase)/decrease in
prepaid expenses - (7,000) -
Increase in accounts
payable 27,465 - 32,455
--------- --------- ---------
Net cash provided (used)
by operating activities 19,967 (11,532) 16,772
--------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES: - - -
--------- --------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from sale of
common stock - - 20,625
Proceeds from sale of
escrowed common stock
(note 2) - 14,790 14,790
Proceeds from borrowings
on note payable - officer 2,500 - 7,500
Deferred offering costs (22,534) (9,925) (59,359)
--------- --------- ---------
Net cash provided (used)
by financing activities (20,034) 4,865 (16,444)
--------- --------- ---------
NET INCREASE (DECREASE) IN
CASH (67) (6,667) 328
CASH, beginning of period 395 8,147 -
--------- --------- ---------
CASH, end of period $ 328 $ 1,480 $ 328
========= ========= ==========
</TABLE>
-4-
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<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. CONDENSED FINANCIAL STATEMENTS
------------------------------
The condensed balance sheet as of June 30, 1996, and the condensed
statements of operations and cash flows for the three months ended
June 30, 1996, the six months ended June 30, 1996, and the period
March 18, 1994 (inception), to June 30, 1996, have been prepared by
the Company without audit. In the opinion of management, all
adjustments (which include only normal recurring adjustments)
necessary to present fairly the financial position, results of
operations and cash flows at June 30, 1996, and for all periods
presented have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these condensed financial statements be read in conjunction with
the December 31, 1995 financial statements and notes thereto included
in the Company's Form 10-K dated March 28, 1996. The results of
operations for the period ended June 30, 1996 are not necessarily
indicative of the operating results for the full year.
2. INITIAL PUBLIC OFFERING
-----------------------
In April 1995, the Company completed an initial public offering of
32,381 shares of $.0001 par value common stock, through an underwriter
on a "firm commitment" basis at $5.25 per share. The offering, which
was made under Rule 419 of Regulation C, requires that the proceeds,
less certain allowable deductions and all the securities purchased by
investors, be placed into an escrow account until the offering has
been reconfirmed by the Company's shareholders and the Company becomes
a party to a merger or acquisition with another business in accordance
with the provisions of Rule 419. In the event an acquisition is not
consummated within 18 months of the effective date of this offering,
which was April 13, 1995, the proceeds held in escrow will be returned
to all investors.
The Company paid the underwriter a commission of 10% of the gross
proceeds of the offering. In addition, the Company issued the
underwriter warrants to purchase 3,238 shares of common stock, which
will be exercisable for a period of four years, commencing one year
from the date of closing, which was April 13, 1995, at an exercise
price of $6.30 per share, subject to adjustment in certain events.
The shares underlying the warrants are subject to piggybank
registration rights, expiring seven years after the effective date of
the offering.
-5-
________________________________________________________________________
<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
3. PROPOSED BUSINESS COMBINATION
-----------------------------
On November 20, 1995, the Company entered into a letter of intent to
acquire all of the issued and outstanding shares of Intelicom
International Corporation (Intelicom). Consummation of the
transaction is dependent upon the shareholders of the Company
reconfirming their investment in the Company in accordance with Rule
419 and approving the issuance of 1,420,687 shares of the Company's
common stock to the holders of Intelicom's common stock. The Company
filed the required Amendment to its registration statement on July 12,
1996 to comply with Rule 419. A meeting is scheduled for September
10, 1996 to obtain the shareholders' consent.
-6-
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<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
- -------------------------------
The Company had cash of $328 and a working capital deficit at June 30, 1996
of $39,627, and cash of $395 at December 31, 1995.
Results of Operations
- ---------------------
For the period from March 18, 1994 (inception) to June 30, 1996, the
Company was inactive. The Company is in the development stage and its
activities through June 30, 1996 consisted primarily of efforts to complete
the public offering and pursue a merger.
The Company's limited expenditures consist of minimal operating expenses
and deferred offering costs. Management expects the Company will continue
to incur losses until such time as a merger or acquisition candidate is
identified and a merger or acquisition is completed.
Management does not expect inflation or changing prices to have any effect
on the Company's financial condition.
-7-
________________________________________________________________________
<PAGE>
THREE-L ENTERPRISES, INC.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
-----------------
NONE.
ITEM 2. CHANGES IN SECURITIES
---------------------
NONE.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
-------------------------------
NONE.
ITEM 4. SUBMISSION OF MATTER TO A VOTE OF SECURITY HOLDERS.
--------------------------------------------------
NONE.
ITEM 5. OTHER INFORMATION.
-----------------
NONE.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
--------------------------------
NONE.
-8-
________________________________________________________________________
<PAGE>
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 hereunto duly authorized.
THREE-L ENTERPRISES, INC.
Date: September 10, 1996 By: /s/ HERMAN K. WATSKY, PRESIDENT
-----------------------------------
Herman K. Watsky, President
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 328
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 328
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 192,797
<CURRENT-LIABILITIES> 39,955
<BONDS> 0
0
0
<COMMON> 4
<OTHER-SE> 19,728
<TOTAL-LIABILITY-AND-EQUITY> 192,797
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 7,498
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (7,498)
<INCOME-TAX> 0
<INCOME-CONTINUING> (7,498)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,498)
<EPS-PRIMARY> (.17)
<EPS-DILUTED> (.17)
</TABLE>
