UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
__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 33-41809-D
Auburn Equities, Inc.
---------------------
(Exact name of registrant as specified in its charter)
Colorado 84-1118262
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6909 South Holly, Suite 235 Englewood, Colorado 80112
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(Address of principal executive offices)
(303) 220-5001
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(Issuer's telephone number)
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(Former name, former address and former
fiscal year if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Sections
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 _____
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Check whether the registrant filed all documents and reports required to be
filed by Sections 12, 13, or 15(d) of the Securities Exchange Act of 1934 after
the distribution of securities under a plan confirmed by a court. Yes ___ No____
APPLICABLE ONLY TO CORPORATE ISSUERS:
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date:
213,618 common shares outstanding as of August 14, 1996
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<PAGE>
The document is comprised of 10 pages.
Auburn Equities, Inc.
(a development stage enterprise)
Index
Part I Page
Item 1. Financial Statements
Condensed balance sheet as of
June 30, 1996.............................. 2
Condensed statements of operations,
three months ended June 30, 1996 and 1995,
the six months ended June 30, 1996
and 1995 and January 24, 1989 through
June 30, 1996.............................. 3
Condensed statements of cash flows, three months ended June
30, 1996 and 1995, the six months ended June 30, 1996
and 1995 and January 24, 1989 through
June 30, 1996.............................. 4
Notes to condensed financial
statements.................................. 5
Item 2. Plan of operation............................. 7
Part II
Other information............................. 8
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote
of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
Signatures.................................... 9
-1-
<PAGE>
Part I. Item 1. Financial Statements
Auburn Equities,_Inc.
(a Development Stage Enterprise)
Condensed Balance Sheet
ASSETS
June 30,
1996
------------
Assets
Cash............................................... $ 224
============
LIABILITIES AND SHAREHOLDERS'_DEFICIT
Liabilities
Accounts payable................................... $ 12,970
Shareholder advances............................... 9,440
Note payable....................................... 5,000
Accrued interest payable........................... 225
------------
Total liabilities............................... 27,635
------------
Shareholders' deficit
Preferred stock.................................... -
Common stock....................................... 2
Other shareholders' deficit........................ (27,413)
------------
Total shareholders' deficit ..................... (27,411)
------------
$ 224
============
See accompany notes to financial statements
-2-
<PAGE>
<TABLE>
<CAPTION>
Auburn Equities, Inc.
(a Development Stage Enterprise)
Condensed Statements of Operations
January 24, 1989
(Inception)
Three Months Ended Six Months Ended through
June 30, June 30, June 30,
1996 1995 1996 1995 1996
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Research and development........................ $ - $ - $ - $ - $ 13,000
Amortization.................................... - - - - 1,000
General and administrative...................... 4,245 5,238 15,130 5,550 108,285
Consulting fees-related party................... - - - - 22,952
Provision for uncollectible accounts receivable. - - - - 130,000
Costs of unsuccessful offering.................. - - - - 12,274
Operating loss................................ (4,245) (5,238) (15,130) (5,550) (287,511)
------------ ------------ ------------ ------------ ------------
Non operating income
Investment income............................. - - - - 6,457
Interest expense................................ (75) - (225) - (225)
------------ ------------ ------------ ------------ ------------
Net (loss)...................................... $ (4,320) $ (5,238) $ (15,335) $ (5,550) $ (281,279)
============ ============ ============ ============ ============
Net loss per share of common stock.............. $ (0.02) $ (0.03) $ (0.07) $ (0.03) $ (1.91)
============ ============ ============ ============ ============
Weighted average shares outstanding............. 213,618 184,478 213,618 184,478 146,903
============ ============ ============ ============ ============
See accompanying notes to financial statements.
-3-
<PAGE>
<CAPTION>
Auburn Equities, Inc.
(A Development Stage Enterprise)
Condensed Statements of Cash Flows
January 24, 1989
(Inception)
Six Months Ended through
June 30, June 30,
1996 1995 1996
------------ ------------ ------------
<S> <C> <C> <C>
Operating activities
Net cash used in operating activities................................... $ (14,307) $ - $ (109,206)
------------ ------------ ------------
Investing activities
Organization costs incurred............................................. - - (1,000)
Investment in common stock.............................................. - - (130,000)
------------ ------------ ------------
Net cash used in investing activities................................. - - (131,000)
------------ ------------ ------------
Cash flows from financing activities
Proceeds from sale of common stock...................................... - - 194,645
Proceeds from shareholder loan.......................................... - - 4,000
Proceeds from cash advances by officer.................................. 9,440 - 9,440
Contributed capital..................................................... - - 27,345
Proceeds from debt issue................................................ - - 10,000
Repayment of debt issue................................................. (5,000) - (5,000)
------------ ------------ ------------
Net cash provided in financing activities............................. 4,440 - 240,430
Net increase (decrease) in cash and cash equivalents...................... (9,867) - 224
Cash and cash equivalents, beginning of period............................ 10,091 91 -
------------ ------------ ------------
Cash and cash equivalents, end of period.................................. $224 $ 91 $ 224
============ ============ ============
</TABLE>
See accompanying notes to financial statements.
-4-
<PAGE>
Auburn Equities, Inc.
(a Development Stage Enterprise)
Notes to Condensed Financial Statements
June 30, 1995
Note A: Basis of presentation
The financial statements presented herein have been prepared by the
Company in accordance with the accounting policies in its annual Form 10-K
report for the year ended December 31, 1995 and should be read in conjunction
with the notes thereto.
In the opinion of management, all adjustments (consisting only of
normal recurring adjustments) which are necessary to provide a fair presentation
of operating results for the interim periods presented have been made.
Interim financial data presented herein are unaudited.
Note B: Related party transactions
A shareholder of the Company paid expenses on behalf of the Company and
infused cash to cover expenses of the Company during the quarter to which this
Quarterly Report is filed. These amounts totalled $8,440 and are reflected as
shareholder advances in the accompanying condensed financial statements.
Note C: Stock distribution
Pursuant to a settlement agreement with the Colorado Division of
Securities, the Company distributed 750,000 (unaudited) shares of Vanguard
common stock to shareholders of record as of November 30, 1995. The distribution
was completed on February 15, 1996. At that time, the Vanguard stock had no
market value. The transaction had no impact on the Company's operations or
financial position.
Note D: Reclassifications
Certain reclassifications have been made in the June 30, 1995 financial
information to conform with the classifications used in the current year.
-5-
<PAGE>
Auburn Equities, Inc.
(a Development Stage Enterprise)
Notes to Condensed Financial Statements, Concluded
June 30, 1995
Note E: Going concern
The accompanying condensed financial statements were prepared under the
assumption that the Company is a going concern. In the course of development,
the Company has sustained continuing operating losses and has a net working
capital deficiency. Its independent accountants' continue to question the
Company's ability to continue as a going concern.
The Company's ability to continue as a going concern is dependent upon
successful completion of additional financing and ultimately, upon achieving
profitable operations. There is no assurance that the Company will be successful
in completing additional financing or becoming an operating company.
-6-
<PAGE>
Part I. Item 2. Plan of Operation
The Company entered into a binding letter of intent with Environmental
Remediation Funding Corporation (ERF) on January 5, 1996, which provides for the
reverse acquisition by the Company in a tax-free exchange of all 2,403,450
issued and outstanding shares of common stock of ERF in consideration for the
issuance by Auburn pro rata to the shareholders of ERF of an aggregate of
6,008,625 shares of the Company's common stock. After the consummation of the
business combination, the shareholders of ERF would own approximately 82.4
percent of the issued and outstanding shares of common stock of the Company. The
consummation of the proposed business combination between the Company and ERF is
specifically subject to certain conditions, including the closing of the
transaction on or prior to May 17, 1996, and the approval by the company's
shareholders at a special meeting of the proposed reorganization together with
the following matters: (1) a forward split in the Company's issued and
outstanding shares of common stock on the basis of six shares of common stock
for each one share then issued and outstanding, (2) a reduction in the Company's
authorized shares of capital stock from 900,100,000 to 50,100,000 authorized
shares, composed of 50,000,000 shares of common stock and 100,000 shares of
preferred stock, $.01 par value per share, and (3) a change in the name of the
Company to "Environmental Remediation Funding Corporation." The executive
officers and directors will be required to resign their positions with the
Company in connection with the reorganization.
No other material changes occurred during the quarter to which this Quarterly
Report is filed. The Company continues to be unable to satisfy its cash
requirements. The Company's existence continues to be dependent upon the ability
and willingness of investors to advance funds to the Company and the continued
forbearance of certain creditors.
No operations were conducted during the most recent quarter. Expenses consisted
of legal and accounting fees and other miscellaneous costs.
The Company has not conducted any product research or development, has no plans
to purchase plant or significant equipment, and does not expect significant
changes in the number of employees.
-7-
<PAGE>
Part II. Other Information
Item 1. Legal Proceedings
not applicable
Item 2. Changes In Securities
not applicable
Item 3. Defaults Upon Senior Securities
not applicable
Item 4. Submission Of Matters To A Vote Of Security Holders
not applicable
Item 5. Other Information
not applicable
Item 6. Exhibits And Reports On Form 8-K
a) Exhibits
not applicable
b) Reports On Form 8-K
not applicable
-8-
<PAGE>
SIGNATURES
The financial information furnished herein has not been audited by an
independent accountant; however, in the opinion of management, all adjustments
(only consisting of normal recurring accruals) necessary for a fair presentation
of the results of operations for the three months ended June 30, 1996 have been
included.
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.
Auburn Equities, Inc.
(Registrant)
/s/ A. Jay Boisdrenghien
Date: _________________ -----------------------------
A. Jay Boisdrenghien
President
-9-
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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<ARTICLE> 5
<CIK> 0000851273
<MULTIPLIER> 1
<CURRENCY> US Dollars
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<EXCHANGE-RATE> 1.000
<CASH> 224
<SECURITIES> 0
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<CURRENT-LIABILITIES> 27,635
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0
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<COMMON> 0
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<TOTAL-LIABILITY-AND-EQUITY> (27,411)
<SALES> 0
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<CGS> 0
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<OTHER-EXPENSES> 14,307
<LOSS-PROVISION> 0
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</TABLE>
