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, 1995
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.
-------------------------
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 30, 1995
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, 1995 and December 31, 1994 1
Condensed Statements of Operations
for the period from March 18, 1994
(inception) to June 30, 1995, the
three months ended June 30, 1995
and 1994, the six month period
ended June 30, 1995 and the period
from March 18, 1994 (inception) to
June 30, 1994. 2
Statement of Stockholders' Equity
for the period from March 18, 1994
(inception) to June 30, 1995 3
Condensed Statements of Cash Flows
for the period from March 18, 1994
(inception) to June 30, 1995, the
six months ended June 30, 1995 and
the period from March 18, 1994
(inception) to June 30, 1994. 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,
1995 1994
_________ __________
ASSETS
CURRENT ASSETS:
Cash $ 1,480 $ 8,147
Prepaid expense 7,000 -
---------- ----------
Total current assets 8,480 8,147
---------- ----------
OTHER ASSETS:
Deferred offering costs 22,752 11,796
Cash held in escrow 133,110 -
---------- ----------
Total other assets 155,862 11,796
---------- ----------
$ 164,342 $ 19,943
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,031 $ -
---------- ----------
ESCROWED COMMON STOCK 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 20,621
(Deficit) accumulated during
the development stage (5,214) (682)
---------- -----------
Total stockholders' equity 30,201 19,943
---------- ----------
$ 164,342 $ 19,943
========== ==========
Note: The balance sheet at December 31, 1994, 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, March 18,
1994 1994
Six Months (Inception) (Inception)
Three Months Ended Ended to to
June 30, June 30, June 30, June 30,
1995 1994 1995 1994 1995
------- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ - $ -
EXPENSES:
General and administrative 3,097 175 4,532 175 5,214
-------- -------- -------- -------- ________
NET (LOSS) $ (3,097) $ (175) $ (4,532) $ (175) $ (5,214)
======== ======== ======== ======== ========
NET (LOSS) PER SHARE OF
COMMON STOCK $ (.07) $ (a) $ (.10) $ (a)
======== ======== ======== ========
Weighted average number
of common shares outstanding 44,000 33,707 44,000 33,707
======== ======== ======== ========
(a) Less than $.01 per share
</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, 1995
(Unaudited)
<TABLE>
<CAPTION>
(Deficit)
Accumulated
Additional During The
Common Stock 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
(see note 2) - - 14,790 -
Net (loss) for the period - - - (4,532)
-------- ------ -------- ---------
Balances, June 30, 1995 44,000 $ 4 $ 35,411 $ (5,214)
======== ====== ======== =========
</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, March 18,
1994 1994
Six Months (Inception) (Inception)
Ended to to
June 30, June 30, June 30,
1995 1994 1995
---------- ---------- ----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net (loss) $ (4,532) $ (175) $ (5,214)
Adjustments to reconcile
net (loss) to net cash
used by operating
activities:
(Increase) in prepaid
expenses (7,000) - (7,000)
-------- ---------- ---------
Net cash (used) by
operating activities (11,532) (175) (12,214)
-------- ---------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES: - - -
-------- ---------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from sale of
common stock - 18,000 20,625
Proceeds from sale of
escrowed common stock
(see note 2) 14,790 - 14,790
Deferred offering costs (9,925) (5,000) (21,721)
-------- ---------- ---------
Net cash provided by
financing activities 4,865 13,000 13,694
-------- ---------- ---------
NET INCREASE (DECREASE) IN
CASH (6,667) 12,825 1,480
CASH, beginning of period 8,147 - -
-------- ---------- ---------
CASH, end of period $ 1,480 $ 12,825 $ 1,480
======== ========== =========
</TABLE>
-4-
_____________________________________________________________________________
<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, 1995, and the condensed
statements of operations and cash flows for the six months ended June 30,
1995, and the period March 18, 1994 (inception), to June 30, 1995, 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, 1995, 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, 1994 financial statements and notes thereto included in the
Company's Prospectus dated April 13, 1995. The results of operations for
the period ended June 30, 1995 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 following summarizes the public offering:
Gross proceeds from sale of
common stock $ 170,000
Underwriter commissions and
nonaccountable expenses paid
directly from proceeds (22,100)
Funds received by the Company
as permitted under Rule 419 (14,790)
---------
Net proceeds held in escrow $ 133,110
=========
-5-
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<PAGE>
THREE-L ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS (Concluded)
(Unaudited)
2. INITIAL PUBLIC OFFERING (Continued)
Because the conditions of Rule 419 have not been met, the Company is
reporting the sale of the 32,381 shares of common stock between the
liability and stockholders' equity sections of the balance sheet.
The Company also 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.
-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 $1,480 and working capital of $7,449 at June 30, 1995,
and cash of $8,147 at December 31, 1994.
As discussed in note 2 to the accompanying financial statements, the Company
sold 32,381 shares of common stock in a public offering under Rule 419 of
Regulation C. The Company received $14,790 which represents 10% of the gross
proceeds after deducting underwriter commissions and nonaccountable expenses.
The balance of $133,110 is being held in escrow until the requirements of Rule
419 have been met.
Results of Operations
For the period from March 18, 1994 (inception) to June 30, 1995, the Company was
inactive. The Company is in the development stage and its activities through
June 30, 1995 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-
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<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
FORM 8-K REGARDING LETTER OF INTENT TO MERGE WITH VALUE TEL, INC.
FILED JUNE 17, 1995. LETTER OF INTENT HAS SUBSEQUENTLY BEEN
WITHDRAWN.
-8-
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<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: October 13, 1995 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-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<CASH> 1,480
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 8,480
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 164,342
<CURRENT-LIABILITIES> 1,031
<BONDS> 133,110
0
0
<COMMON> 4
<OTHER-SE> 30,197
<TOTAL-LIABILITY-AND-EQUITY> 164,342
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,097
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (3,097)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,097)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,097)
<EPS-PRIMARY> (.07)
<EPS-DILUTED> (.07)
</TABLE>
