UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For Quarter Ended September 30, 2005
[] 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: 000-25809
SICLONE INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 87-0426999
- -------------------------------- --------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
378 North Main, #124; Layton, UT 84041
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(Address of principal executive offices)
Registrant's telephone number including area code: (801) 497-9075
--------------
6269 Jamestown Court; Salt Lake City, UT 84121
Former Address, 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 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
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23,810,000
Number of shares the issuer had outstanding as of October 25, 2005.
PART I
ITEM 1 - FINANCIAL STATEMENTS
The condensed financial statements included herein have been prepared
by the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations, although the Company believes that the disclosures are
adequate to make the information presented not misleading.
In the opinion of the Company, all adjustments, consisting of only
normal recurring adjustments, necessary to present fairly the financial position
of the Company as of September 30, 2005 and the results of its operations and
changes in its financial position from December 31, 2004 through September 30,
2005 have been made. The results of its operations for the interim periods are
not necessarily indicative of the results to be expected for the entire year.
2
SICLONE INDUSTRIES, INC.
(A Development Stage Company)
Financial Statements
September 30, 2005 and December 31, 2004
3
SICLONE INDUSTRIES, INC.
(A Development Stage Company)
Balance Sheets
September 30, December 31,
2005 2004
---------------------- ----------------------
(Unaudited)
Assets
Current Assets
Cash $ 24 $ 124
---------------------- ----------------------
Total Current Assets 24 124
---------------------- ----------------------
Total Assets $ 24 $ 124
====================== ======================
Liabilities and Stockholders' Equity (Deficit)
Current liabilities
Accounts payable $ 4,969 $ 840
Notes payable 36,412 33,212
Accrued interest payable 9,993 7,339
---------------------- ----------------------
Total Current Liabilities 51,374 41,391
---------------------- ----------------------
Stockholders' Equity (Deficit)
Preferred stock; $.001 par value, 5,000,000 shares
authorized, 0 issued and outstanding - -
Common stock; $.001 par value, 30,000,000 shares
authorized, 23,810,000 issued and outstanding 23,810 23,810
Additional paid in capital 583,693 583,693
Accumulated deficit (658,853) (648,770)
---------------------- ----------------------
Total Stockholders' Equity (Deficit) (51,350) (41,267)
---------------------- ----------------------
Total Liabilities and Stockholders' Equity (Deficit) $ 24 $ 124
====================== ======================
The accompanying notes are an integral part of these
financial statements.
SICLONE INDUSTRIES, INC.
(A Development State Company)
Statements of Operations
(Unaudited)
From
Inception
November
For the Three Months For the Nine Months 1, 1985
Ended Ended through
September September September September September
30, 30, 30, 31, 30,
2005 2004 2005 2004 2005
--------------- ----------------- --------------- --------------- ----------------
Revenue $ - $ - $ - $ - $ -
--------------- ----------------- --------------- --------------- ----------------
Expenses
Expenses 4,267 2,152 10,083 9,115 (63,350)
--------------- ----------------- --------------- --------------- ----------------
Total Expenses 4,267 2,152 10,083 9,115 (63,350)
--------------- ----------------- --------------- --------------- ----------------
Loss before Discontinued Operations (4,267) (2,152) (10,083) (9,115) (63,350)
Loss from Discontinued Operations - - - - (595,503)
--------------- ----------------- --------------- --------------- ----------------
Net Loss $ (4,267) $ (2,152) $ (10,083) $ (9,115) $ (658,853)
=============== ================= =============== =============== ================
Basic Loss Per Share $ (0.00) $ $ (0.00) $ (0.00) $ (0.00)
=============== ================ =============== ===============
Weighted Average Outstanding
Shares 23,810,000 23,810,000 23,810,000 23,810,000
=============== ================ =============== ===============
The accompanying notes are an integral part of these
financial statements.
SICLONE INDUSTRIES, INC.
(A Development State Company)
Statements of Cash Flows
(Unaudited)
From
Inception
November 1,
For the Nine months Ended 1985 through
September 30, September 30, September 30,
2005 2004 2005
------------------ ------------------ -----------------
Cash Flows from Operating Activities
Net income (loss) $ (10,083) $ (9,115) $ (658,853)
Adjustments to reconcile net income to net cash (used in)
operating activities:
Change in cash from operating assets and liabilities:
Common stock issued for services - - 50
Increase in accounts payable 4,129 702 4,969
Increase in accrued interest payable 2,654 2,277 9,993
------------------ ------------------ -----------------
Net cash (used in ) operating activities (3,300) (6,136) (652,841)
----------------- ------------------ -----------------
Cash Flows from Investing Activities
Net cash (used in) investing activities - - -
------------------ ------------------ -------------------
Cash Flows From Financing Activities:
Proceeds from notes payable - related party 3,200 5,875 36,412
Additional capital contributed - - 10,180
Stock offering costs - - (18,678)
Issuance of common stock for cash - - 615,951
------------------ ------------------ -----------------
Net cash provided by financing activities 3,200 5,875 643,865
------------------ ------------------ -----------------
Net increase (decrease) in cash (100) (261) 24
Cash, Beginning of Period 124 352 -
------------------ ------------------ -----------------
Cash, End of Period $ 24 $ 91 $ 24
================== ================== =================
Supplemental Disclosures of Cash Flow Information
Interest paid $ - $ - $ -
Taxes - - -
Common stock issued for services - - 50
The accompanying notes are an integral part of these financial statements.
Siclone Industries, Inc.
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
September 30, 2005
(Unaudited)
NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION
The accompanying unaudited condensed financial statements have been prepared by
the Company pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed or omitted in
accordance with such rules and regulations. The information furnished in the
interim condensed financial statements include normal recurring adjustments and
reflects all adjustments, which, in the opinion of management, are necessary for
a fair presentation of such financial statements. Although management believes
the disclosures and information presented are adequate to make the information
not misleading, it is suggested that these interim condensed financial
statements be read in conjunction with the Company's most recent audited
financial statements and notes thereto included in its December 31, 2004 Annual
Report on Form 10-KSB of Siclone Industries, Inc. Operating results for the
three months ended September 30, 2005 are not necessarily indicative of the
results that may be expected for the year ending December 31, 2005.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using accounting principles
generally accepted in the United States of America applicable to a going concern
which contemplates the realization of assets and liquidation of liabilities in
the normal course of business. The Company has not yet established an ongoing
source of revenues sufficient to cover its operating costs and allow it to
continue as a going concern. The ability of the Company to continue as a going
concern is dependent on the Company obtaining adequate capital to fund operating
losses until it becomes profitable. If the Company is unable to obtain adequate
capital, it could be forced to cease operations.
In order to continue as a going concern, develop a reliable source of revenues,
and achieve a profitable level of operations the Company will need, among other
things, additional capital resources. Management's plans to continue as a going
concern include raising additional capital through sales of common stock.
However, management cannot provide any assurances that the Company will be
successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent upon its
ability to successfully accomplish the plans described in the preceding
paragraph and eventually secure other sources of financing and attain profitable
operations. The accompanying financial statements do not include any adjustment
that might be necessary if the Company is unable to continue as a going concern.
6
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.
Safe Harbor for Forwardlooking Statements
The discussion and analysis contained herein should be read in
conjunction with the preceding financial statements and the information
contained in the Company's Form 10-QSB and the Company's most recent Form
10-KSB. Except for the historical information contained herein, the matters
discussed in this Form 10- QSB contain forward looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, and the Private
Securities Litigation Reform Act of 1995, including, among others (I) expected
changes in the Company's revenues and profitability, (ii) the effects of
cost-reduction measures, (iii) prospective business opportunities and (iv) the
Company's strategy for improving and funding its business, that are based on
management's beliefs and assumptions, current expectations, estimates, and
projections. Statements that are not historical facts, including, without
limitation, statements which are preceded by, followed by, or include the words
"believes," "anticipates," "plans," "expects," "may," "should" or similar
expressions are forward-looking statements. Many of the factors that will
determine the Company's future results are beyond the ability of the Company to
control or predict. These statements are subject to risks and uncertainties and,
therefore, actual results may differ materially. All subsequent written and oral
forward-looking statements attributable to the Company, or persons acting on its
behalf, are expressly qualified in their entirety by these cautionary
statements. The Company disclaims any obligation to update any forward-looking
statements whether as a result of new information, future events, or otherwise.
Description of Business
Siclone Industries, Inc. originally incorporated in Delaware on November 1,
1985 as McKinnely Investments, Inc. The Company changed its name to Accoline
Industries, Inc. on November 5, 1986 and again changed its name to Siclone
Industries, Inc. on May 24, 1988.
The Company has not had active business operations since its inception
and is considered a development stage company.
The Company intends to seek, investigate, and if warranted, acquire an
interest in a business opportunity. It will not restrict its search to
any particular industry or geographical area and may, therefore, engage in
essentially any business in any industry. Its management has
unrestricted discretion in seeking and participating in a business opportunity,
subject to the availability of such opportunities, economic conditions and other
factors.
The selection of a business opportunity in which to participate is
complex and extremely risky and will be made by management in the exercise of
its business judgment. There is no assurance that it will be able to
identify and acquire any business opportunity which will ultimately prove to be
beneficial to the Company and its shareholders.
The Company's activities are subject to several significant risks which
arise primarily as a result of the fact that it has no specific business and may
acquire or participate in a business opportunity based on the decision of
management which will, in all probability, act without the consent, vote, or
approval of its shareholders.
7
Plan of Operations
Management intends to actively seek business opportunities during the
next twelve months. If they identify a suitable business opportunity during the
year, the need for capital may change dramatically. Should the Company require
additional capital, it may seek additional advances from officers, sell common
stock or find other forms of debt financing. To date the Company has not pursued
any business opportunities and there can be no assurance that the management
will identify a business venture suitable for acquisition in the future. In
addition, it cannot assure that it will be successful in consummating any
acquisition on favorable terms or that it will be able to profitably manage any
business venture it acquires.
The current operating plan is to continue searching for potential
businesses, products, technologies and companies for acquisition and to handle
the administrative and reporting requirements of a public company.
Sources of Opportunities
The Company anticipates that business opportunities may arise from
various sources, including its officers and directors, professional advisers,
securities broker-dealers, venture capitalists, members of the financial
community, and others who may present unsolicited proposals.
The Company will seek potential business opportunities from all known
sources, but will rely principally on the personal contacts of its officers and
directors as well as indirect associations between them and other business and
professional people. Although management does not anticipate engaging
professional firms specializing in business acquisitions or reorganizations,
such firms may be retained if management deems it in the Company's best
interests. In some instances, the Company may publish notices or
advertisements seeking a potential business opportunity in financial or trade
publications.
Criteria
The Company will not restrict its search to any particular business,
industry or geographical location. The Company may acquire or enter into a
business in any industry and in any stage of development. This may
include a business or opportunity involving a "start up" or new company.
In seeking a business venture, management's decision will not be
controlled by an attempt to take advantage of an anticipated or perceived appeal
of a specific industry, management group, or product or industry, but will be
based upon the business objective of seeking long-term capital appreciation in
the real value of the Company.
In analyzing prospective business opportunities, management will
consider such matters as the available technical, financial and managerial
resources; working capital and other financial requirements; the history of
operations, if any; prospects for the future; the nature of present and expected
competition; the quality and experience of management services which may be
available and the depth of the management; the potential for further research,
development or exploration; the potential for growth and expansion; the
potential for profit; the perceived public recognition or acceptance of
products, services, trade or service marks, name identification; and other
relevant factors.
Generally, management will analyze all available factors in the
circumstances and make a determination based upon a composite of available
facts, without reliance upon any single factor as controlling.
8
Methods of Participation of Acquisition
Specific business opportunities will be reviewed and, on the basis of
that review, the legal structure or method of participation deemed by management
to be suitable will be selected. Such structures and methods may
include, but are not limited to, leases, purchase and sale agreements, licenses,
joint ventures, other contractual arrangements, and may involve a
reorganization, merger or consolidation transaction. The Company may act
directly or indirectly through an interest in a partnership, corporation, or
other form of organization.
Procedures
As part of the ongoing investigation of business opportunities,
officers and directors may meet personally with management and key personnel of
the firm sponsoring the business opportunity, visit and inspect material
facilities, obtain independent analysis or verification of certain information
provided, check references of management and key personnel, and conduct other
reasonable measures.
Management will generally request that it be provided with written
materials regarding the business opportunity containing such items as a
description of product, service and company history; management resumes;
financial information; available projections with related assumptions upon which
they are based; an explanation of proprietary products and services; evidence of
existing patents, trademarks or service marks or rights thereto; present and
proposed forms of compensation to management; a description of transactions
between the prospective entity and its affiliates; relevant analysis of risks
and competitive conditions; a financial plan of operation and estimated capital
requirements; and other information deemed relevant.
Competition
The Company expects to encounter substantial competition in its efforts
to acquire a business opportunity. The primary competition is from other
companies organized and funded for similar purposes, small venture capital
partnerships and corporations, small business investment companies and wealthy
individuals.
Employees
The Company does not currently have any employees. It relies upon the
efforts of its officers and directors to conduct its business.
Results of Operations for the Three-Month Period Ended September 30, 2005
and 2004
The Company has not generated any revenues since its inception on
November 1, 1985. Expenses for the three-month period ended September 30, 2005
were $4,267 compared to expenses of $2,152, during the same period in 2004.
Expenses during both periods consisted mainly of professional, legal and
accounting costs related to the Company's public filings.
As a result of the foregoing factors, the Company realized a net loss
of $4,267 for the three-month period ended September 30, 2005, compared to a net
loss of $2,152 for the three-month period ended September 30, 2004.
9
Results of Operations for the Nine-Month Period Ended September 30, 2005
and 2004
Expenses for the nine-month period ended September 30, 2005 were
$10,083 compared to expenses of $9,115, during the same period in 2004. Expenses
during both periods consisted mainly of professional, legal and accounting costs
related to the Company's public filings.
As a result of the foregoing factors, the Company realized a net loss
of $10,083 for the nine-month period ended September 30, 2005, compared to a net
loss of $9,115 for the nine-month period ended September 30, 2004.
Liquidity and Capital Resources
At September 30, 2005 the Company's total assets consisted of $24 in
cash. Total liabilities at September 30, 2005 were $51,374 consisting of
$4,969 in accounts payable, $36,412 in notes payable to an unrelated third party
and $9,993 in accrued interest.
In recent years the Company has relied on advances from the former
president to cover its operating costs. The Company has little or no operations
and no funds with which to develop operations. The Company is currently in the
process of seeking short term capital while it investigates business
opportunities to merge with or acquire. The Company currently has no agreement
or arrangement of merger or acquisition.
There is no guarantee that the Company will be successful in developing
any business opportunities or acquiring any operational capital. Any investment
in the Company would be a highly speculative investment and should only be made
by those investors who are capable of bearing the risk of losing the entire
value of their investment.
ITEM 3 - CONTROLS AND PROCEDURES.
(a) Evaluation of disclosure controls and procedures. The Company
maintains disclosure controls and procedures designed to ensure that information
required to be disclosed in the reports that the Company files or submits under
the Securities Exchange Act of 1934, is recorded, processed, summarized and
reported within the time period specified in the rules and forms of the
Securities and Exchange Commission. The Company's management including its
principal executive officer and its principal financial officer, based on their
evaluation of the Company's disclosure controls over financial reporting and
procedures (as defined in Exchange Act Rules 13a-14c)) in connection with the
Annual Report on Form 10-KSB as of December 31, 2004, have concluded that the
Company's disclosure controls over financial reporting and procedures are
adequate and effective as of September 30, 2005 for the purposes set forth in
the definition in Exchange Act rules.
(b) Changes in internal controls over financial reporting. There were
not any significant changes in the Company's internal controls over financial
reporting or in other factors that could materially affect or is reasonably
likely to materially affect, or significantly affect the Company's internal
controls subsequent to the date of their evaluation
10
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 Matters to a Vote of Security Holders........None
Item 5. Other Information . . . . . . . . . . . . . . . . . . . . None
Item 6. Exhibits and Reports on Form 8-K
1). The following exhibits are filed with this report:
31. Written statement of Chief Executive Officer and Chief
Financial Officer with respect to the compliance with Section 302 of the
Sarbanes-Oxley Act of 2002.
32. Written statement of Chief Executive Officer and Chief
Financial Officer with respect to the compliance with Section 13 (a) and 15(d)
of the Securities Exchange Act of 1934 and pursuant to the 19 U.S.C. 1350, as
adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002.
2). Form 8-K's filed during the period covered by this report:
None.
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 authorized officer.
Date: November 11, 2005 Siclone Industries, Inc.
By /s/ Paul Adams
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11