UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
------- OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
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 number 33-25253
TRIANGLE, INC.
---------------------------------------------------
Exact Name of Registrant as Specified in its Charter
Colorado 93-0969365
------------------------------ ---------------------------
State or Other Jurisdiction of IRS Employer Identification
Incorporation or Organization Number
830 Northeast Loop 410, Suite 305B, San Antonio, TX 78209
--------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(210) 821-5577
--------------------------------------------------
Registrant's Telephone Number, Including Area Code
N/A
--------------------------------------------------------------
(Former Name, Former Address and Formal 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
--------- ---------
The number of shares outstanding of each of the issuer's classes of
common shares, as of the latest practicable date:
No Par Value Outstanding at July 31, 1996
Common Shares 57,003,090 shares
-------------------- ----------------------------
Class of Securities Outstanding Securities
______________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
INDEX
Page
----
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets
June 30, 1996, and December 31,
1995 1
Condensed Statements of Operations
for the period from December 8, 1981
(inception), to June 30, 1996, the
three months ended June 30, 1996 and
1995, and the six months ended June 30,
1996 and 1995 2
Statement of Stockholders' Equity (Deficit)
for the period from December 8, 1981
(inception), to June 30, 1996 3 - 7
Condensed Statements of Cash Flows
for the period from December 8, 1981
(inception), to June 30, 1996, and
the six months ended June 30, 1996
and 1995 8
Notes to Condensed Financial Statements 9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 10
Part II. OTHER INFORMATION 11
______________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
CONDENSED BALANCE SHEETS
(Unaudited)
June 30, December 31,
1996 1995
---- ----
ASSETS
------
Current assets:
Cash $ 5 $ 136
========= =========
LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------
Current liabilities:
Accounts payable $ 4,106 $ 10,840
--------- ---------
Stockholders deficit:
Preferred stock - -
Common stock 216,924 213,324
Deficit accumulated during
development stage (221,025) (224,028)
--------- ---------
(4,101) (10,704)
--------- ---------
$ 5 $ 136
========= =========
Note: The balance sheet at December 31, 1995 has been taken from the
audited financial statements at that date and condensed.
-1-
______________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
December 8,
1981
Inception
Three Months Ended Six Months Ended to
June 30, June 30, June 30,
----------------- --------------- --------
1996 1995 1996 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Interest income $ - $ - $ - $ - $ 3,230
Operating expenses:
Legal and accounting 2,751 - 2,975 1,242 55,013
Filing fees 1,448 - 1,448 - 8,309
Public relations - - - - 14,414
Other (7,455) 156 (7,426) 423 27,409
--------- --------- --------- --------- ---------
(3,256) 156 (3,003) 1,665 105,145
--------- --------- --------- --------- ---------
3,256 (156) 3,003 (1,665) (101,915)
Writeoff of advances/
recision of merger - - - - (119,110)
--------- --------- --------- --------- ---------
Net income/(loss) $ 3,256 $ (156) $ 3,003 $ (1,665) $(221,025)
========= ========= ========= ========= =========
Net income/(loss) per
share (a) (a) (a) (a)
========= ========= ========= =========
Weighted average
number of shares
outstanding 57,003,090 56,217,424 56,904,518 56,151,507
========== ========== ========== ==========
(a) Less than $.01 per
share
</TABLE>
-2-
_____________________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
For the Period December 8, 1981 (Inception)
To June 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Class B Deficit
Common Stock Common Stock Accumulated
------------------- -------------------- During
Number of Number of Development
Shares Amount Shares Amount Stage
------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C>
Balance at inception
December 8, 1981 - $ - - $ - $ -
Issuance of stock to
officers and
directors March,
1988:
for cash ($.003
per share) 2,118,640 6,355 - - -
Issuance of stock
March, 1988:
for cash ($.003
per share) 2,881,360 8,645 - - -
Net loss for the
year ended December
31, 1988 - - - - (7,179)
---------- --------- ---------- --------- ---------
Balances, December
31, 1988 5,000,000 15,000 - - (7,179)
Issuance of stock in
public offering, net
of expenses of
$71,435 20,316,000 131,725 - - -
Issuance of stock to
underwriter 677,200 100 - - -
Issuance of stock to
affiliated entities - - 1,000,000 10,000 -
Conversion of stock 15,000,000 10,000 (1,000,000) (10,000) -
Shares not returned
in merger reversal 10,000,000 - - - -
</TABLE>
-3-
_______________________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (Continued)
For the Period December 8, 1981 (Inception)
To June 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Class B Deficit
Common Stock Common Stock Accumulated
----------------------------------------- During
Number of Number of Development
Shares Amount Shares Amount Stage
------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C>
Net loss for the year
ended December 31,
1989 - - - - (154,955)
---------- --------- ---------- --------- --------
Balances, December
31, 1989 50,993,200 156,825 - - (162,134)
Net loss for the year
ended December 31,
1990 - - - - (4,622)
---------- --------- ---------- --------- --------
Balances, December
31, 1990 50,993,200 156,825 - - (166,756)
Net loss for the year
ended December 31,
1991 - - - - (330)
---------- --------- ---------- --------- ---------
Balances, December
31, 1991 50,993,200 156,825 - - (167,086)
Issuance of stock
to officers and
directors, for
cash, June, 1992,
($.01 per share) 731,910 7,319 - - -
Net loss for the
year ended
December 31, 1992 - - - - (10,929)
---------- --------- ---------- --------- --------
Balances, December
31, 1992 51,725,110 164,144 - - (178,015)
</TABLE>
-4-
_______________________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (Continued)
For the Period December 8, 1981 (Inception)
To June 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Class B Deficit
Common Stock Common Stock Accumulated
----------------------------------------- During
Number of Number of Development
Shares Amount Shares Amount Stage
------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C>
Issuance of stock
to officers and
directors, for
cash, during 1993
($.01 per share) 1,375,000 13,750 - - -
Issuance of stock
for cash, April,
1993
($.01 per share) 90,480 905 - - -
Issuance of stock
for officer
compensation,
November, 1993
($.01 per share) 2,500,000 25,000 - - -
Net (loss) for the
year ended December
31, 1993 - - - - (33,944)
---------- --------- ---------- --------- --------
Balances, December
31, 1993 55,690,590 203,799 - - (211,959)
Issuance of stock
to an officer/
director and a
shareholder for
cash, November,
1994 ($.01 per
share) 230,000 2,300 - - -
Issuance of stock
to officer for
reimbursement of
expenses, November,
1994 ($.01 per
share) 142,500 1,425 - - -
</TABLE>
-5-
______________________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (Continued)
For the Period December 8, 1981 (Inception)
To June 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Class B Deficit
Common Stock Common Stock Accumulated
----------------------------------------- During
Number of Number of Development
Shares Amount Shares Amount Stage
------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C>
Net (loss) for the
year ended December
31, 1994 - - - - (5,216)
---------- --------- ---------- --------- ---------
Balances, December
31, 1994 56,063,090 207,524 - - (217,175)
Issuance of stock
to officer for
cash, January, 1995,
($.01 per share) 20,000 200 - - -
Issuance of stock
to officer for
cash, May, 1995,
($.01 per share) 200,000 2,000 - - -
Issuance of stock
to officer for
cash, August, 1995
($.01 per share) 60,000 600 - - -
Issuance of stock
to officer for
cash, September, 1995 300,000 3,000 - - -
($.01 per share)
Net (loss) for the
year ended December
31, 1995 - - - - (6,853)
---------- --------- ---------- --------- ---------
Balances, December
31, 1995 56,643,090 213,324 - - (224,028)
Issuance of stock
to officer for
cash, January, 1996 100,000 1,000 - - -
($.01 per share)
</TABLE>
-6-
______________________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (Concluded)
For the Period December 8, 1981 (Inception)
To June 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Class B Deficit
Common Stock Common Stock Accumulated
----------------------------------------- During
Number of Number of Development
Shares Amount Shares Amount Stage
------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C>
Issuance of stock
to officer for
cash, February, 1996 260,000 2,600 - - -
($.01 per share)
Net income for the
six months ended
June 30, 1996 - - - - 3,003
---------- --------- ---------- --------- ---------
Balance, June 30,
1996 57,003,090 $ 216,924 - $ - $(221,025)
========== ========= ========== ========= =========
</TABLE>
-7-
_______________________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
December 8,
1981
Six Months Ended (Inception)
June 30, to
--------------------- June 30,
1996 1995 1996
---- ---- ----
Cash flows from operating
activities:
Net income/(loss) $ 3,003 $ (1,665) $(221,025)
Adjustments to reconcile
net (loss) to net cash
used by operating
activities:
Amortization - - 750
Stock issued for services - - 26,425
Change in assets and
liabilities:
(Decrease) in accounts
payable (6,734) (446) 4,106
--------- --------- ---------
Net cash used by
operating activities (3,731) (2,111) (189,744)
--------- --------- ---------
Cash flows from investing
activities:
Organization costs - - (750)
--------- --------- ---------
Cash flows from financing
activities:
Proceeds from issuance
of common stock 3,600 2,225 251,934
Proceeds from issuance
of Class B common
stock - - 10,000
Deferred offering costs - - (71,435)
--------- --------- ---------
Net cash provided by
financing activities 3,600 2,225 190,499
--------- --------- ---------
Net increase (decrease) in
cash (131) 114 5
Cash, beginning of period 136 116 -
--------- --------- ---------
Cash, end of period $ 5 $ 230 $ 5
========= ========= =========
-8-
_____________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. CONDENSED FINANCIAL STATEMENTS
------------------------------
The condensed balance sheet as of June 30, 1996, the condensed
statements of operations for the three months ended June 30, 1996 and
1995, the six months ended June 30, 1996 and 1995, and the period
December 8, 1981 (inception), to June 30, 1996, and cash flows for the
six months ended June 30, 1996, and the period December 8, 1991
(inception), to June 30, 1996, 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 June
30, 1996, and for all periods presented have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these condensed financial statements be read in conjunction with
the December 31, 1995, financial statements and notes thereto included
in the Company's Form 10-K. The results of operations for the periods
ended June 30, 1996 and 1995, are not necessarily indicative of the
operating results for the full year.
2. PROPOSED MERGER
---------------
On November 21, 1995, the Company signed a letter of intent to acquire
Texas Quick Service, Inc. (TQSI) in exchange for common stock of the
Company. Under the terms of the letter of intent, the Company plans
to acquire 100% of TQSI's stock in exchange for 90% of the Company's
outstanding common stock. TQSI is a holding company with no
operations and was formed to acquire the assets of Red Line Burgers,
Inc. under a reorganization plan. Red Line Burgers, Inc. owns,
operates or franchises several hamburger restaurant chains in Texas
and is presently in reorganization under Chapter 11 of the U.S.
Bankruptcy Code.
-9-
_____________________________________________________________________
<PAGE>
TRIANGLE, INC.
(A Development Stage Company)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
- -------------------------------
The Company had cash of $5 and no working capital at June 30, 1996, and
cash of $136 and no working capital at December 31, 1995.
Results of Operations
- ---------------------
For the period from December 8, 1981 (inception), to March of 1988, the
Company was inactive. The Company is in the development stage and its
activities through June 30, 1996, consisted primarily of efforts to
complete the public offering and pursue a merger.
The Company's limited expenditures consist of minimal operating expenses.
Management expects the Company will continue to incur small losses until
such time as a merger or acquisition is completed. The net income for the
six months ended June 30, 1996, was the result of a writeoff of some
previously accrued expenses that were disputed and the statute of
limitations has terminated the obligation.
Management does not expect inflation or changing prices to have any effect
on the Company's financial condition.
-10-
_____________________________________________________________________
<PAGE>
TRIANGLE, INC.
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 MATTER TO A VOTE OF SECURITY HOLDERS.
--------------------------------------------------
NONE.
ITEM 5. OTHER INFORMATION.
-----------------
NONE.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
--------------------------------
NONE.
-11-
_____________________________________________________________________
<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 hereunto duly authorized.
TRIANGLE, INC.
Date: September 10, 1996 By: /s/ ROBERT ELLIS, PRESIDENT
--------------------------------
Robert Ellis, President
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 5
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 5
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 5
<CURRENT-LIABILITIES> 4,106
<BONDS> 0
0
0
<COMMON> 216,924
<OTHER-SE> (221,025)
<TOTAL-LIABILITY-AND-EQUITY> 5
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> (3,003)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 3,003
<INCOME-TAX> 0
<INCOME-CONTINUING> 3,003
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,003
<EPS-PRIMARY> 0<F1>
<EPS-DILUTED> 0<F1>
<FN>
<F1>LESS THAN $.01 PER SHARE.
</FN>
</TABLE>
