UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
November 13, 1998
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended: September 30, 1998
Commission file number 0-26322
Eagle Capital International, Ltd.
(Formerly IAC, Inc.)
Incorporated pursuant to the Laws of the State of Nevada
Internal Revenue Service Employer Identification No. 88-0303769
2916 Brookburn Drive
Salt Lake City, UT 89104
(801) 272-9119
Check whether issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 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 _X__ No __
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under the plan confirmed by the court. Yes __X__ No
----
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
1,997,918 shares.
Transitional Small Business Disclosure Format (Check one): Yes ___ No _X_
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
Eagle Capital International, Ltd.
(Formerly IAC, Inc.)
BALANCE SHEET
September 30, 1998
(Unaudited)
ASSETS
CURRENT ASSETS
Cash in bank
-----------------
-----------------
TOTAL CURRENT ASSETS
-----------------
OTHER ASSETS
Organizational costs, net of amortization
-----------------
-----------------
TOTAL ASSETS
=================
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable $ 2,800
Other liabilities 7,852
-----------------
TOTAL CURRENT LIABILITIES $ 10,652
-----------------
STOCKHOLDERS' EQUITY
Preferred stock, no par value, 5,000,000 shares authorized; 2,500
300,000 outstanding
Capital stock, $.001 par value, 75,000,000 shares 1,997
authorized; 1,997,918 shares outstanding
Additional paid in capital 754,986
Accumulated deficit (748,831)
---------------
$ (10,652)
----------------
total liabilities and stockholders' equity
=================
See notes to unaudited financial statements.
Eagle Capital International, Ltd.
(Formerly IAC, Inc.)
STATEMENT OF OPERATIONS
AND ACCUMULATED DEFICIT
(Unaudited)
Three Months Ended
September 30
1998 1997
REVENUES
Management fees $ 30,244
Other income 0
--------------------
$ 30,244
OPERATING AND GENERAL EXPENSES
Compensation and employee benefits
Promotion and trade shows
Administrative expenses $ (39,349) (2,599)
-------------------- --------------------
INCOME (LOSS) FROM OPERATIONS (39,349) 32,843
-------------------- --------------------
INCOME TAXES 0 0
-------------------- --------------------
NET INCOME (LOSS) (39,349) 32,843
Accumulated deficit-beginning of period (709,482) (748,149)
-------------------- --------------------
Accumulated deficit-end of period $ (748,831) $ (715,306)
==================== ====================
Income (Loss) per share $ (0.02) $ 0.01
See notes to unaudited financial statements.
Eagle Capital International, Ltd.
(Formerly IAC, Inc.)
STATEMENT OF OPERATIONS AND DEFICIT
(Unaudited)
Nine Months Ended
September 30
1998 1997
REVENUES
Management fees $ 87,674
Other income 26
---------------------------------------
87,700
---------------------------------------
OPERATING AND GENERAL EXPENSES
Compensation and employee benefits 43,581
Promotion and advertising 3,224
Administrative expenses $ 39,349 75,623
---------------------------------------
39,349 122,428
---------------------------------------
LOSS FROM OPERATIONS (39,349) (34,728)
---------------------------------------
---------------------------------------
INCOME TAXES (800) (800)
---------------------------------------
NET INCOME (LOSS) (40,149) (35,528)
Accumulated deficit-beginning of period (708,682) (679,778)
---------------------------------------
Accumulated deficit-end of period $ (748,831) $ (715,306)
=======================================
Income (Loss) per share $ (0.02) $ (0.01)
=======================================
See notes to unaudited financial statements.
Eagle Capital International, Ltd.
(Formerly IAC, Inc.)
STATEMENT OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30
1998 1997
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss $ (40,149) $ (35,528)
Adjustment to reconcile net loss to net cash provided
by (used in) operating activities:
Amortization 1,429 12,953
Increase in receivable from related party (811)
Decrease in refundable payroll taxes
Increase in accounts payable and other liabilities (1,382) 11,762
Decrease in receivable from related party
Issuance of shares of common stock for services 32,250
--------------------------------
--------------------------------
Net Cash Used In Operating Activities (7,852) (11,624)
--------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Sale of investment securities
--------------------------------
Net Cash Used In Investing Activities 0 0
--------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Loan 7,852
--------------------------------
Net Cash Provided By Financing Activities 7,852 0
--------------------------------
Net Increase (Decrease) In Cash 0 (11,624)
Cash At Beginning Of Period 11,713
================================
Cash At End Of Period $ 0 $ 89
================================
Income taxes paid during period $ 800
================================
See notes to unaudited financial statements.
Eagle Capital International, Ltd.
(Formerly IAC, Inc.)
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIODS ENDED SEPTEMBER 30, 1998 AND 1997
Note 1 - Organization, operations and summary of significant accounting
policies:
Organization:
Eagle Capital International, Ltd. ("Eagle")(formerly IAC, Inc.)is a
Nevada corporation that has changed its name effective November 5, 1998.
Corporate offices have been moved to Salt Lake City, Utah.
The Company agreed to acquire the assets of IMSI Cap Fund, Inc. These
assets consist primarily of agreements with Integrated Masonry Systems
International, Inc. ("IMSI") to supply, on a first right of refusal basis,
capital equipment to IMSI for its joint ventures worldwide. IMSI holds
international patents for a unique block construction system and has contracts
with a variety of foreign governments to supply block to their development
projects. Additionally, IAC will have the right to employ IMSI's products to
supply block to its own development projects. The original agreement to acquire
IMSI was revoked in favor of this acquisition. IAC will issue 1,656,000 shares
of its Series A Preferred Stock, valued at $414,000 to acquire these assets.
Basis of Presentation
The consolidated financial statements have been prepared on the going
concern basis. IAC has reported a net loss during the past two years.
Effective August 14, 1998 the Company reverse split its common stock on
a 4 to 1 basis.
Effective August 31, 1998 Douglas A. Dent was elected to the Board of
Directors and became its Chairman and the President of the Company.
Note 2 - Summary of significant accounting policies:
The process of preparing financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions regarding certain types of assets, liabilities, revenues and
expenses. Such estimates primarily relate to unsettled transactions and events
as of the date of the financial statements. Accordingly, upon settlement, actual
results may differ from the estimated amounts.
Revenues are recorded when collected.
Expenses are recorded on the accrual basis of accounting.
The carrying value of cash, marketable equity securities, note
receivable, accounts payable and accrued liabilities is a reasonable estimate of
fair value of these financial instruments.
Note 3 - Preferred stock:
Each share of preferred stock is entitled to one vote per share and is
convertible into 2.5 shares of common stock; the preferred stock is entitled to
20% of the Company's after-tax profits and has no preference in liquidation.
Note 4 - Income taxes:
At December 31, 1997, a valuation allowance of approximately $110,000
was provided for deferred tax assets relating primarily to the future tax
benefit of Eagle's net operating loss carryforwards. As a result, the future tax
benefit of Eagle's net operating losses has not been recognized in the
accompanying financial statements.
At December 31, 1997, Eagle's consolidated net operating loss carry
forwards (NOL's) amounted to approximately $545,000 for federal tax purposes.
These NOL's will expire from 1999 through 2012. For California franchise tax
purposes, the NOL is approximately $287,000 and expires in 2002.
Note 5 - Subsequent Events:
Effective November 5, 1998 the Company changed its name to
Eagle Capital International, Ltd.
Item 2. Management's Discussion and Analysis or Plan of Operation.
The following discussion relates to the unaudited financial statements
for the three-month periods ended September 30, 1998 and 1997, which are
included in Item 1 above.
Basis of presentation:
The financial statements as of September 30, 1998 have been prepared on
the going concern basis. Eagle has reported a loss during the last two years.
In addition, its current liabilities substantially exceed its available cash.
The Company is completing its acquisition of the assets of IMSI Cap Fund, Inc.
Liquidity:
Eagle has used all of its cash in its operations with the result
that cash reserves were depleted at December 31, 1997. As of September 30,
1998, Eagle's current liabilities of $10,652 exceed its cash resources.
Discussion of quarterly results:
The Company ceased operations effective December 31, 1997 and is completing
the acquisition as stated above. The Company's ability to execute its new
business plan will depend on a number of factors, including its ability to
obtain additional funding. There can be no assurance that such funding will be
obtained.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
NA.
Item 2. Changes in Securities.
The Company's common stock was reverse split on a 4 for 1 basis,
effective August 14, 1998. The Series A Preferred Stock is convertible into 2.5
shares of common stock and is entitled to 20% of the Company's after-tax
profits.
Item 3. Defaults Upon Senior Securities.
NA.
Item 4. Submission of Matters to a Vote of Security Holders.
NA.
Item 5. Other Information.
NA.
Item 6. Exhibits and Reports on Form 8-K.
a. Exhibits
NA
b. Reports on Form 8-K.
No reports have been filed on Form 8-K during this quarter.
/S/ Douglas A. Dent, President
August 13, 1998