<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 0-10695
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REGENCY EQUITIES CORP.
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(Exact name of registrant as specified in its charter)
Delaware 23-2298894
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(State or other jurisdiction (I.R.S. employer
of incorporation or organization) identification no.)
11845 WEST OLYMPIC BOULEVARD, SUITE 900 LOS ANGELES, CA 90064
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code 310-827-9604
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Former name, former address and former 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 X No
---- ----
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date. Number of Shares of Common
Stock outstanding as of October 31, 1996 is 87,283,661.<PAGE>
<PAGE>
REGENCY EQUITIES CORP.
INDEX
Page
----
Part I Financial information
Item 1. Financial statements
Balance sheets as of September 30, 1996
(unaudited) and December 31, 1995 . . . . . . . . . 1
Statements of operations for the three
months and nine months ended September 30, 1996
and 1995 (unaudited) . . . . . . . . . . . . . . . . 2
Statement of changes in shareholders' equity
for the nine months ended September 30, 1996
(unaudited) . . . . . . . . . . . . . . . . . . . . . 3
Statements of cash flows for the nine months
ended September 30, 1996 and 1995 (unaudited) . . . . 4
Notes to financial statements (unaudited) . . . . . . . 5
Item 2. Management's discussion and analysis
of financial condition and results
of operations . . . . . . . . . . . . . . . . . . . . . 6
Part II Other information
Item 6. Exhibits and reports on Form 8-K . . . . . . . . . . . . 7
Signature page . . . . . . . . . . . . . . . . . . . . . . . . . 8
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
REGENCY EQUITIES CORP.
BALANCE SHEETS
SEPTEMBER 30, DECEMBER 31,
1996 1995
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(unaudited)
ASSETS
Cash and cash equivalents $ 2,911,621 $ 2,975,808
Rent receivable 93,814 100,989
Rental property owned, net of write
down for possible loss of $215,000 and
accumulated depreciation of $282,141
in 1996 and $245,340 in 1995 974,300 1,011,101
Deferred income taxes 122,068 151,822
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$ 4,101,803 $ 4,239,720
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LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable and accrued expenses $ 18,229 $ 211,778
Income taxes payable 1,720 1,320
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19,949 213,098
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SHAREHOLDERS' EQUITY
Preferred stock, par value $.01 per
share, authorized 5,000,000 shares;
none issued
Common stock, par value $.01 per
share, authorized 125,000,000 shares;
issued and outstanding 87,283,661
shares 872,836 872,836
Additional paid-in capital 47,660,331 47,660,331
Accumulated (deficit) (44,451,313) (44,506,545)
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4,081,854 4,026,622
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$ 4,101,803 $ 4,239,720
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See accompanying notes to financial statements
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<PAGE>
REGENCY EQUITIES CORP.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------------------ -------------------------
1996 1995 1996 1995
------------ ----------- ------------ -----------
<S> <C> <C> <C> <C>
REVENUES
Interest income $ 28,585 $ 22,461 $ 91,254 $ 129,984
Rental income 70,124 70,504 204,830 201,018
------------ ----------- ------------ -----------
Total revenues 98,709 92,965 296,084 331,002
------------ ----------- ------------ -----------
EXPENSES
Administrative expense 24,184 26,262 75,003 190,824
Professional fees 8,158 15,547 49,507 393,107
Rental expense 29,803 30,186 83,668 79,945
------------ ----------- ------------ -----------
Total expenses 62,145 71,995 208,178 663,876
------------ ----------- ------------ -----------
Income (loss)
before income
taxes 36,564 20,970 87,906 ( 332,874)
PROVISION (BENEFIT) FOR
INCOME TAXES 15,088 259 32,674 1,721
------------ ----------- ------------ -----------
Net income (loss) $ 21,476 $ 20,711 $ 55,232 ($ 334,595)
------------ ----------- ------------ -----------
------------ ----------- ------------ -----------
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 87,283,661 87,283,661 87,283,661 87,283,661
------------ ----------- ------------ -----------
------------ ----------- ------------ -----------
INCOME (LOSS) PER SHARE $ .000 $ .000 $ .001 ($ .004)
------------ ----------- ------------ -----------
------------ ----------- ------------ -----------
</TABLE>
See accompanying notes to financial statements
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<PAGE>
REGENCY EQUITIES CORP.
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(Unaudited)
<TABLE>
<CAPTION>
COMMON STOCK
----------------------- ADDITIONAL
NUMBER OF PAID-IN ACCUMULATED
SHARES AMOUNT CAPITAL DEFICIT
----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
BALANCE AT
December 31, 1995 87,283,661 $ 872,836 $47,660,331 ($44,506,545)
Net income for the
nine months ended
September 30, 1996 55,232
----------- ----------- ------------ ------------
BALANCE AT
September 30, 1996 87,283,661 $ 872,836 $47,660,331 ($44,451,313)
----------- ----------- ------------ ------------
----------- ----------- ------------ ------------
</TABLE>
See accompanying notes to financial statements
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<PAGE>
REGENCY EQUITIES CORP.
STATEMENTS OF CASH FLOWS
(Unaudited)
NINE MONTHS ENDED
SEPTEMBER 30,
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1996 1995
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CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Net income (loss) $ 55,232 ($ 334,595)
Adjustments to reconcile net
income (loss) to net cash provided
by (used in) operating activities:
Depreciation 36,801 36,801
Change in operating assets and
liabilities:
Rent receivable 7,175 8,190
Deferred income taxes 29,754 ( 1)
Accounts payable and accrued expenses ( 193,549) 145,126
Income taxes payable 400 ( 4,400)
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NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES: ( 64,187) ( 148,879)
CASH FLOW FROM FINANCING
ACTIVITIES:
Dividends paid 13,092,549
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NET (DECREASE) INCREASE IN CASH ( 64,187) ( 13,241,428)
CASH - BEGINNING OF PERIOD 2,975,808 15,298,990
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CASH - END OF PERIOD $ 2,911,621 $ 2,057,562
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See accompanying notes to financial statements
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<PAGE>
Regency Equities Corp.
Notes to Financial Statements
September 30, 1996
(Unaudited)
1. Significant accounting policies
Significant accounting policies of Regency Equities Corp. (the Company) are
set forth in its Annual Report on Form 10-K as filed by the Company for the
year ended December 31, 1995, together with certain procedural disclosures.
2. Basis of reporting
The balance sheet as of September 30, 1996, the statements of operations
for the three month periods ended September 30, 1996 and 1995 and the nine
month periods ended September 30, 1996 and 1995, the statement of changes
in shareholders' equity for the nine months ended September 30, 1996 and
the statements of cash flows for the nine month periods ended September 30,
1996 and 1995 have been prepared by the Company without audit. The
accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and
Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statement presentation. In the opinion
of management, such statements include all adjustments (consisting only of
normal recurring items) which are considered necessary for a fair
presentation of the financial position of the Company at September 30, 1996
and the results of its operations and cash flow for the three month and
nine month periods then ended. It is suggested that these financial
statements be read in conjunction with the financial statements and the
notes thereto included in the Company's Annual Report on Form 10-K for the
year ended December 31, 1995.
3. Rental property
Real estate owned consists of a shopping center in Grand Rapids, Michigan.
Two tenants lease space in the shopping center. The leases expire on July
10, 1997 and August 31, 1999.
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<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Material changes in financial condition
There was a material change in the Company's financial condition during the
quarter ended March 31, 1995 arising from the payment of a cash dividend of
$13,092,549 (see "Dividend" below).
Results of Operations
During the third quarter of 1996, the Company recorded net income of $36,564
before income taxes compared to income of $20,970 for the same period of 1995.
The increase resulted principally from a decrease in professional fees of $7,389
and an increase in interest income of $6,124 primarily attributable to an
increase in cash earning interest of $64,187.
During the nine months ended September 30, 1996, the Company recorded net income
of $87,906 before income taxes compared to a net loss of $332,874 for the same
period of 1995. The increase in net income resulted principally from (i) a
decrease of administrative expenses of $115,821 primarily due to decreases in
shareholders' meeting costs and directors' fees attributable to a proxy contest
involving the Company; and (ii) a decrease in professional fees of $343,600
primarily attributable to legal fees incurred in connection with the proxy
contest. The increase in income was offset in part by a decrease in interest
income of $38,730 caused by the decrease in cash earning interest attributable
to the $13,092,549 dividend. Reference is made to the Company's annual report
on Form 10-K for the year ended December 31, 1995 for a more detailed discussion
of the proxy contest.
Dividend
The Company paid a cash dividend on February 7, 1995 of $13,092,549 ($.15 per
share) to shareholders which represented approximately 77.5% and 77.8% of the
Company's assets and shareholders' equity, respectively, as of December 31,
1994.
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<PAGE>
PART II - Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit 27.1 Financial Data Schedule (included only in the
electronic filing).
(b) Reports on Form 8-K
None.
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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 thereunto duly authorized.
REGENCY EQUITIES CORP.
---------------------------------------
(Registrant)
DATE: November 8, 1996 By /s/ ALLAN L. CHAPMAN
------------------------------------
Allan L. Chapman,
Chairman of the Board, Chief
Executive Officer and President
(Principal Executive Officer)
DATE: November 8, 1996 By /s/ MORRIS ENGEL
------------------------------------
Morris Engel
Chief Financial Officer and Treasurer
(Principal Financial and Accounting
Officer)
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<PAGE>
REGENCY EQUITIES CORP.
QUARTERLY REPORT ON FORM 10-Q
INDEX TO EXHIBITS
Exhibit
Number
27.1 Financial Data Schedule (included only in the electronic filing)
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<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF REGENCY EQUITIES CORP. FOR THE PERIOD ENDED SEPTEMBER
30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 2,911,621
<SECURITIES> 0
<RECEIVABLES> 93,814
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,005,435
<PP&E> 1,256,441
<DEPRECIATION> 282,141
<TOTAL-ASSETS> 4,101,803
<CURRENT-LIABILITIES> 19,949
<BONDS> 0
0
0
<COMMON> 872,836
<OTHER-SE> 3,209,018
<TOTAL-LIABILITY-AND-EQUITY> 4,101,803
<SALES> 0
<TOTAL-REVENUES> 296,084
<CGS> 0
<TOTAL-COSTS> 83,668
<OTHER-EXPENSES> 124,510
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 87,906
<INCOME-TAX> 32,674
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 55,232
<EPS-PRIMARY> .001
<EPS-DILUTED> .001
</TABLE>
