UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1998
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 Nos.: 33-60662
FUND AMERICA INVESTORS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 84-1070310
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) identification number)
6400 S. Fiddler's Green Circle, Suite 1200A, Englewood, Colorado 80111
(Address of principal executive offices)
Registrant's telephone number including area code: (303) 290-6024
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 May 15, 1998 -- 1,000 shares
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FUND AMERICA INVESTORS CORPORATION
FORM 10-Q FOR THE
THREE MONTHS ENDED MARCH 31, 1998
INDEX
PART I. FINANCIAL INFORMATION PAGE NO.
Item 1. Financial Statements 3
Item 2. Management's Discussion and
Analysis of Financial Condition
and Results of Operations 6
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 7
Item 2. Changes in Securities 7
Item 3. Defaults upon Senior Securities 7
Item 4. Submission of Matters to a Vote
of Security Holders 7
Item 5. Other Information 7
Item 6. Exhibits and Reports 7
SIGNATURES 8
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<TABLE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
FUND AMERICA INVESTORS CORPORATION
BALANCE SHEETS
(Unaudited)
<CAPTION>
March 31, December 31,
1998 1997
-------- -----------
<S> <C> <C>
Assets
Cash $ 111,907 $ 117,269
Deferred offering costs 38,903 38,903
--------- ---------
Total assets $ 150,810 $ 156,172
========= =========
Liabilities - accounts payable $ 7,140 $ 106
--------- ---------
Shareholder's equity
Common stock, par value $.01
per share; 10,000 shares
authorized; 1,000 shares
issued and outstanding 10 10
Additional paid-in capital 369,990 369,990
Accumulated deficit (226,330) (213,934)
--------- ---------
Total shareholder's equity 143,670 156,066
--------- ---------
Total liabilities and
shareholder's equity $ 150,810 $ 156,172
========= =========
<FN>
See notes to financial statements
Page 3
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<TABLE>
FUND AMERICA INVESTORS CORPORATION
Statements of Operations
(Unaudited)
<CAPTION>
Three months ended
March 31,
_________________________
1998 1997
-------- --------
<S> <C> <C>
Revenue
Interest income $ 1,304 $ 1,226
--------- ---------
Total revenue 1,304 1,226
--------- ---------
Expenses
General and administrative 7,700 6,621
Legal fees - 132
Management fees 6,000 6,000
--------- ---------
Total expenses 13,700 12,753
--------- ---------
Net loss $ (12,396) $ (11,527)
========= =========
<FN>
See notes to financial statements
Page 4
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<TABLE>
FUND AMERICA INVESTORS CORPORATION
Statements of Cash Flows
(Unaudited)
<CAPTION>
Three months ended
March 31,
--------------------------
1998 1997
-------- --------
<S> <C> <C>
Net cash flow used in
operating activities:
Net loss $(12,396) $(11,527)
Adjustments to reconcile
net loss to net cash flow
from operating activities:
Changes in operating assets
and liabilities:
Accounts payable 7,034 6,282
-------- --------
Net cash flow used in operating
activities (5,362) (5,245)
-------- --------
Net decrease in cash (5,362) (5,245)
Cash at beginning of period 117,269 147,076
-------- --------
Cash at end of period $111,907 $141,831
======== ========
<FN>
See notes to financial statements
Page 5
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FUND AMERICA INVESTORS CORPORATION
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Three months ended March 31, 1998 and 1997
1. Basis of Presentation
Organization
Fund America Investors Corporation (the "Company") was incorporated in the
State of Delaware on October 19, 1987 as a limited purpose finance corporation.
The company was established to engage in the issuance and administration of
Collateralized Mortgage Obligations ("CMOs") which are secured by mortgage
loans or by mortgage loan pass-through certificates backed by mortgage loans
(collectively referred to as the "Collateral"). The Collateral may be issued
and/or guaranteed by agencies, including the Government National Mortgage Asso-
ciation, the Federal National Mortgage Association and the Federal Home Loan
Mortgage Corporation, or other entities. To issue such CMOs, the Company may
acquire, hold, sell or pledge the Collateral, but typically these activities
are transacted through trusts beneficially owned and created by the Company.
The Company may not, either directly or indirectly through a beneficially
owned trust, engage in any business or investment activity other than (1)
issuing and selling bonds; (2) investing cash balances on an interim basis
in high quality short-term securities; (3) purchasing, owning, holding,
pledging or selling the collateral or other mortgage-related assets; and
(4) engaging in other activities which are necessary or convenient to accomp-
lish the foregoing and are incidental thereto.
During the first quarter ended March 31, 1998, there was no activity on the
Company's fourth Registration Statement No. 33-60662. The Company is, however,
planning to update the Registration Statement through amendments in order to
utilize the $141 million of remaining and unissued CMOs. After all updates are
completed, the Company expects that an affiliated mortgage company will utilize
the remaining balance by securitizing mortgage loans generated from their
operations.
2. Unaudited Financial Statements
In the opinion of management, the accompanying unaudited financial state-
ments contain all adjustments necessary to present fairly the financial
position of the Company at March 31, 1998, and the results of its operations
and cash flows for the periods ended March 31, 1998 and 1997.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Liquidity and Capital Resources
The Company expects to fund its ongoing operations from its cash balances,
revenue derived from CMO offerings and, if necessary, with borrowings from its
sole shareholder. As of March 31, 1998, $500,000 was available to be borrowed
from the Company's sole shareholder. Any borrowings will be subordinate and
junior to any issued mortgage securities.
Results of Operations
The Company reported a net loss for the three months ended March 31, 1998
of $12,396 as compared to a net loss for the three months ended March 31, 1997
of $11,527. An increase in General and Administrative expenses is the primary
difference in the results of operations between the two reporting periods.
Page 6
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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
Exhibit 27. Financial Data Schedule
B. Form 8-K - None
Page 7
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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.
FUND AMERICA INVESTORS CORPORATION
(Registrant)
Date: May 15, 1998 By: /s/ Helen M. Dickens
----------------- -----------------------------------
Helen M. Dickens
Vice President and Secretary
(Duly authorized and Principal
Financial Officer)
Page 8
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 111907
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 111907
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 150810
<CURRENT-LIABILITIES> 7140
<BONDS> 0
0
0
<COMMON> 10
<OTHER-SE> 143670
<TOTAL-LIABILITY-AND-EQUITY> 150810
<SALES> 0
<TOTAL-REVENUES> 1304
<CGS> 0
<TOTAL-COSTS> 13700
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (12396)
<INCOME-TAX> 0
<INCOME-CONTINUING> (12396)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (12396)
<EPS-PRIMARY> 0<F1>
<EPS-DILUTED> 0<F1>
<FN>
<F1>
Not presented since all shares of common stock are held by a sole
shareholder.
</FN>
</TABLE>
