SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-QSB
[X] Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act
of 1934
For the Quarter Ended: September 30, 2002
[ ] Transition Report Under Section 13 or 15(d) of the Securities Exchange Act
of 1934
For the Transition Period from _____________ to ____________
Commission File Number 0-25951
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CONSOLIDATED ENERGY INC.
(formerly Barbecue Capital Corp)
----------------------------------------------
(Name of Small Business Issuer in its charter)
Nevada 86-0852222
- ------------------------------- --------------------------
(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
8800 North Gainey Ranch Center Drive, Suite 256, Scottsdale, Arizona 85258
--------------------------------------------------------------------------
(Address of principal executive offices and Zip Code)
(480) 453-0851
----------------------------------------------------
(Registrant's telephone number, including area code)
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.
(1) Yes X No (2) Yes X No
--- --- --- ---
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Common Stock, Par Value $0.001 7,868,000
- -------------------------------- ----------------------------
Title of Class Number of Shares Outstanding
as of November 25, 2002
1
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION.................................................3
Item 1. Financial Statements................................................. 3
Balance Sheets....................................................... 3
Statements of Operations............................................. 4
Statements of Stockholders' Equity (Deficit)......................... 5
Statements of Cash Flows............................................. 6
Notes to the Financial Statements.................................... 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operation.................................. 7
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.....................................................9
Item 2. Changes in Securities.................................................9
Item 3. Default Upon Senior Securities........................................9
Item 4. Submission of Matters to a Vote of Security Holders...................9
Item 5. Other Information ....................................................9
Item 6. Exhibits and Reports .................................................9
Signatures ...................................................................10
Certifications ...............................................................10
2
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED ENERGY INC.
FINANCIAL STATEMENTS
(UNAUDITED)
The 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. However, in the opinion of
management, all adjustments (which include only normal recurring accruals)
necessary to present fairly the financial position and results of operations for
the periods presented have been made. These financial statements should be read
in conjunction with the accompanying notes, and with the historical financial
information of the Company.
CONSOLIDATED ENERGY INC.
(A Development Stage Company)
Balance Sheets
<table>
<caption>
ASSETS
September 30 December 31,
2002 2001
----------- -----------
(Unaudited)
CURRENT ASSETS
Cash $ - $ -
----------- -----------
Total Current Assets - -
----------- -----------
TOTAL ASSETS $ - $ -
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 14,996 $ 14,921
Accounts payable - related party (Note 5) 10,170 7,918
------------ ----------
TOTAL LIABILITIES 25,166 22,839
------------ ----------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $0.001 par value,
authorized 25,000,000 shares;
1,023,000 shares issued and outstanding 1,023 1,023
Additional paid-in capital 50,371 50,371
Deficit accumulated during the development
stage (76,560) (74,233)
----------- ---------
Total Stockholders= Equity (Deficit) (25,166) (22,839)
----------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ - $ -
=========== =========
</table>
The accompanying notes are an integral part of these financial statements.
3
CONSOLIDATED ENERGY INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
<table>
<caption>
From
Inception on
For the For the December 18,
Three Months Ended Nine Months Ended 1996 Through
September 30, September 30, September 30,
2002 2001 2002 2001 2002
---------- ------ ------- -------- ------------
REVENUE $ - $ - $ - $ - $ -
EXPENSES 559 6,054 2,327 13,498 76,560
-------- ------- ------- -------- --------
NET LOSS $ (559) $(6,054) $(2,327) $(13,498) $(76,560)
========= ======== ======== ========= =========
BASIC LOSS PER SHARE $ (0.01) $ (0.00) $ (0.01) $ (0.01)
========= ======== ======== =========
</table>
The accompanying notes are an integral part of these financial statements.
4
CONSOLIDATED ENERGY INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
<table>
<caption>
Deficit
Accumulated
Common Stock Additional During the
--------------------- Paid-In Development
Shares Amount Capital Stage
---------- --------- ---------- -----------
Inception,
December 18, 1996 - $ - $ - $ -
Common stock issued
for cash at $.02 per share 500,000 500 9,500 -
Net loss from inception
on December 18, 1996
through December 31, 1996 - - - -
-------- --------- --------- ----------
Balance,
December 31, 1996 500,000 500 9,500 -
Net loss for the year
ended December 31, 1997 - - - (458)
-------- --------- --------- ----------
Balance,
December 31, 1997 500,000 500 9,500 ( 458)
Common stock issued for
cash at $0.10 per share 523,000 523 51,777 -
Stock offering costs - - (10,906) -
Net loss for the year
ended December 31, 1998 - - - (13,186)
--------- --------- --------- ----------
Balance,
December 31, 1998 1,023,000 1,023 50,371 (13,644)
Net loss for the year
ended December 31, 1999 - - - (30,724)
--------- --------- --------- ----------
Balance,
December 31, 1999 1,023,000 1,023 50,371 (44,368)
Net loss for the year
ended December 31, 2000 - - - (11,918)
--------- --------- --------- ----------
Balance,
December 31, 2000 1,023,000 1,023 50,371 (56,286)
Net Loss for the year
ended December 31, 2001 - - - (17,947)
--------- --------- --------- ----------
Balance,
December 31, 2001 1,023,000 1,023 50,371 (74,233)
Net loss for the Nine
months ended
Sept 30, 2002(unaudited) - - - (2,327)
--------- --------- --------- ----------
Balance, September 30, 2002
(unaudited) 1,023,000 $ 1,023 $ 50,371 $ (76,560)
=========== ========= ========= ===========
</table>
The accompanying notes are an integral part of these financial statements.
5
CONSOLIDATED ENERGY INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
<table>
<caption>
From
For the Inception on
Nine Months Ended December 18,
September 30, 1996 Through
------------------------ September 30,
2002 2001 2002
---------- -------- --------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (2,327) $ (13,498) $ (76,560)
Adjustments to reconcile net
loss to net cash (used) by
operating activities:
Amortization expense - - 495
Disposal of prototype - - 1,500
Change is operating assets
and liabilities:
Increase (decrease) in
accounts payable and accounts
payable - related party 2,327 13,498 25,166
---------- ---------- ----------
Net Cash (Used) by Operating
Activities - - (49,399)
---------- ---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES
Development of prototype - - (1,500)
Organization costs incurred - - (495)
---------- ---------- ----------
Net Cash Used by Investing
Activities - - (1,995)
---------- ---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Stock offering costs - - (10,906)
Issuance of common stock for cash - - 62,300
---------- ---------- ----------
Net Cash Provided by
Financing Activities - - 51,394
---------- ---------- ----------
INCREASE (DECREASE) IN CASH - - -
CASH AT BEGINNING OF PERIOD - - -
---------- ---------- ----------
CASH AT END OF PERIOD $ - $ - $ -
========== ========== ==========
Cash Paid For:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
</table>
The accompanying notes are an integral part of these financial statements.
6
CONSOLIDATED ENERGY INC.
(A Development Stage Company)
Notes to the Financial Statements
September 30, 2002 and December 31, 2001
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
The accompanying financial statements 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 September 30, 2002 and 2001 and for all
periods presented have been made.
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. It is suggested
that these condensed financial statements be read in conjunction with the
financial statements and notes thereto included in the Company's December 31,
2001 audited financial statements. The results of operations for periods ended
September 30, 2002 and 2001 are not necessarily indicative of the operating
results for the full years.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles 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 established revenues sufficient to cover its
operating costs and allow it to continue as a going concern. The Company is
seeking a merger with an existing operating company. Currently, management is
committed to cover all operating and other costs until sufficient revenues are
generated.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
- -------------------------------------------------
This periodic report contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 with respect to
the financial condition, results of operations, business strategies, operating
efficiencies or synergies, competitive positions, growth opportunities for
existing products, plans and objectives of management. Statements in this
periodic report that are not historical facts are hereby identified as
"forward-looking statements."
Business of the Company
- -----------------------
The Company was incorporated in Nevada on December 18, 1996, to engage in
the manufacture and distribution of commercial size barbecues for individual,
groups, and restaurant use. After two seasonal business cycles of trying to
develop a market for the Company's barbecues, management of the Company
determined that without significant additional funding, the Company would not be
able to compete in the barbecue business. Accordingly, after several
unsuccessful attempts to obtain additional capital, the Company determined that
it was in the Company's and its shareholders best interest to cease the barbecue
business and search for alternative businesses while the Company was still
solvent.
7
The Company intends to take advantage of any reasonable business proposal
presented which management believes will provide the Company and its
stockholders with a viable business opportunity. The board of directors will
make the final approval in determining whether to complete any acquisition, and
unless required by applicable law, the articles of incorporation, bylaws or by
contract, stockholders' approval may not be sought.
The investigation of specific business opportunities and the negotiation,
drafting, and execution of relevant agreements, disclosure documents, and other
instruments will require management time and attention and will require the
Company to incur costs for payment of accountants, attorneys, and others. If a
decision is made not to participate in or complete the acquisition of a specific
business opportunity, the costs incurred in a related investigation will not be
recoverable. Further, even if an agreement is reached for the participation in a
specific business opportunity by way of investment or otherwise, the failure to
consummate the particular transaction may result in the loss to the Company of
all related costs incurred.
Currently, management is not able to determine the time or resources that
will be necessary to complete the participation in or acquisition of any future
business prospect. There is no assurance that the Company will be able to
acquire an interest in any such prospects, products or opportunities that may
exist or that any activity of the Company, regardless of the completion of any
participation in or the acquisition of any business prospect, will be
profitable.
Discussion and Analysis of Financial Condition and Results of Operations
- ------------------------------------------------------------------------
Liquidity and Capital Resources
-------------------------------
As of September 30, 2002, the Company had no assets and liabilities of
$25,166. If the Company cannot find a new business, it will have to seek
additional capital either through the sale of its shares of common stock or
through a loan from its officer. The Company has only incidental ongoing
expenses primarily associated with maintaining its corporate status and
professional fees associated with accounting and legal costs and should not
require substantial money to maintain its SEC filing obligations and corporate
status.
Management anticipates that the Company will incur more cost including
legal and accounting fees to locate and complete a merger or acquisition. At the
present time the Company does not have the assets to meet these financial
requirements. Additionally, the Company does not have substantial assets to
entice potential business opportunities to enter into transactions with the
Company.
Since inception the Company has not generated revenue and it is unlikely
that any revenue will be generated until the Company locates a business
opportunity with which to acquire or merge. Management of the Company will be
investigating various business opportunities. These efforts may cost the Company
not only out of pocket expenses for its management but also expenses associated
with legal and accounting cost. There can be no guarantee that the Company will
receive any benefits from the efforts of management to locate business
opportunities.
8
If and when the Company locates a business opportunity, management of the
Company will give consideration to the dollar amount of that entity's profitable
operations and the adequacy of its working capital in determining the terms and
conditions under which the Company would consummate such an acquisition.
Potential business opportunities, no matter which form they may take, will most
likely result in substantial dilution for the Company's shareholders as it has
only limited capital and no operations.
The Company does not intend to employ anyone in the future, unless its
present business operations were to change. The president of the Company is
providing the Company with a location for its offices on a "rent free basis."
The Company does intend to reimburse its officers and directors for out of
pocket cost.
Results of Operations
---------------------
For the three months ended September 30, 2002, the Company had a net loss
of $559 compared to a loss for the quarter ended September 30, 2001, of $6,256.
The Company anticipates losses to remain at the present level until a business
opportunity is found. The Company had no revenue for the three months ended
September 30, 2002, as a result of the termination of its barbecue business. The
Company does not anticipate any revenue until it locates a new business
opportunity.
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
(a) Exhibits.
- ---------
Item 4 Instruments Defining the Rights of Security Holders
- ------- ---------------------------------------------------
4.01 4 Specimen Stock Certificate Incorporated
by reference*
99.01 99 Certification Pursuant to 906 This Filing
99.02 99 Certification Pursuant to 906 This Filing
* Incorporated by reference from the Company's registration statement on form
10-SB filed with the Commission, SEC file no. 0-25951.
(b) Reports on Form 8-K.
--------------------
None.
9
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 thereunto duly authorized.
CONSOLIDATED ENERGY INC.
[Registrant]
Dated: November 27, 2002 By: /s/ David W. Guthrie
-------------------------------
David W. Guthrie, CEO, President,
Chief Financial Officer, and Director
EXHIBIT 99.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Consolidated Energy Inc. (the
"Company") on Form 10-QSB for the period ending September 30, 2002, as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, David W. Guthrie, Chief Executive Officer of the Company, certify, pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and result of operations of the Company.
/s/ David W. Guthrie
- ------------------------
David W. Guthrie
Chief Executive Officer
EXHIBIT 99.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Consolidated Energy Inc. (the
"Company") on Form 10-QSB for the period ending September 30, 2002, as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, David W. Guthrie, President, Chief Financial Officer of the Company, certify,
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and result of operations of the Company.
/s/ David W. Guthrie
- ------------------------
David W. Guthrie
President, Chief Financial Officer
10