10-Q/A 1 d24968_10q-a.txt QUARTERLY REPORT FORM 10-Q/A SECURITIES & EXCHANGE COMMISSION WASHINGTON, DC 20549 Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended: June 30, 2000 Commission File Number: 000-29945 The Oxbow Fund, LLC New Jersey 22-09695 223 Wanaque Avenue Pompton Lakes, New Jersey 07442 (973) 831-8020 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 [ ] No [x] As of June 30, 2000, there were 2180 of the Limited Liability Company's Units, at $100 per Unit, outstanding. PART 1 Financial Information Item 1. Financial Statements (unaudited) The Oxbow Fund, LLC Statement of Assets and Liabilities Quarter Ended: June 30, 2000 -------------------------------------------------------------------------------- The Oxbow Fund, LLC Statement of Operations Quarter Ended: June 30, 2000 -------------------------------------------------------------------------------- The Oxbow Fund, LLC Statement of Cash Flows Quarter Ended: June 30, 2000 -------------------------------------------------------------------------------- June 30, 2000 ------------- (unaudited) Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. The Oxbow Fund, LLC (the "Fund") is a New Jersey limited liability company organized on September 15, 1999. The Fund has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended (the "Act"). The Fund will operate as a non-diversified closed-end management investment company as defined in the Act. The Fund's principal investment objective is to seek long-term capital appreciation by investing primarily in securities of private U.S. companies, although the Fund may make other types of investments. The Fund's Investment Manager is C.J.M. Asset Management, LLC (the "Investment Manager"). Four Independent Directors and three persons affiliated with the Investment Manager serve as Directors of the Fund. The Investment Manager is responsible for the Fund's investments, subject to the supervision of the Directors. The Fund is offering up to 250,000 Units of ownership interests in the Fund in an aggregate amount of up to $25,000,000 (the "Units"). The offering commenced on June 13, 2000. There is no minimum offering amount. The Units are being offered and sold through C.J.M. Planning Corp., a registered Broker-Dealer and an affiliate of the Investment Manager. The offering will terminate on August 31, 2001, unless terminated earlier at the discretion of the Fund's Board of Directors. As of June 30, 2000 the Fund has not commenced investment operations. The Fund's fiscal year-end is December 31. The Fund will continue until March 31, 2010, subject to the right of the Directors to extend the term for up to two additional two-year periods. Liquidity and Capital Resources On March 1, 2000 the Investment Manager purchased 1,000 Units for $100,000. The Company began the initial public offering of Units on June 13, 2000. As of June 30, 2000, the Company has accepted subscriptions for 1,180 Units in an aggregate amount of $118,000. To date, the Fund received proceeds of $218,000 from sales of investor units, of which $100,000 was from Investment Managers' capital contributions. Cash and cash equivalents at June 30, 2000, totaled $125,773. Future proceeds from the sales of Units and operating cash reserves are expected to be adequate to fund the Fund's operations. Item 3. Quantitative and Qualitative Disclosure About Market Risk. Not applicable PART 2 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 A. INVESTMENTS IN OXBOW CREDIT AND KAMAAS Two entities in which the Fund invested subsequent to June 30, 2000, Oxbow Credit Company, LLC ("Oxbow Credit") and The Kamaas Group ("Kamaas"), were formed with the assistance of Dan Dyer, the Chief Executive Officer of the Fund. Oxbow Capital Partners, LLC, an affiliate of Mr. Dyer (the "Affiliate"), loaned start-up capital to these entities. The Affiliate loaned approximately $535,000 to Oxbow Credit and approximately $86,000 to Kamaas. To date, approximately $236,000 of the loan by the Affiliate to Oxbow Credit was repaid by Oxbow Credit to the Affiliate without interest. No portion of the loan by the Affiliate to Kamaas has been repaid to Kamaas. Although the Affiliate was an original member of Oxbow Credit, the Affiliate relinquished all interest in Oxbow Credit prior to the date on which the Fund invested in Oxbow Credit. A similar arrangement existed with respect to the formation of Kamaas. When counsel for the Fund reviewed the Fund's investment in Oxbow Credit and Kamaas with Mr. Dyer and the Board, a question arose as to whether, because of Mr. Dyer's involvement in the formation of these entities, the investments might be governed by the statutes and rules of the Investment Company Act of 1940 concerning affiliate transactions. Though it has not been determined that the subject statutes and rules are applicable to the transactions, the Board and Mr. Dyer have decided to rescind the investments. Mr. Dyer is assisting Oxbow Credit and Kamaas in securing other capital in order to return the monies invested by the Fund as soon as practicable. The Fund invested a total of $489,186 in Oxbow Credit and $60,000 in Kamaas. As of February 20, 2001, $108,650 of the Fund's investment in Oxbow Credit and the Fund's entire investment in Kamaas have been returned to the Fund. B. POST-EFFECTIVE AMENDMENT The Fund intends to file a post-effective amendment to its Registration Statement on Form N-2 with the Securities and Exchange Commission to update certain information including financial statements regarding the Fund. As part of this process, the Fund has requested its new auditors to re-certify the financial statements in the Registration Statement. Until the SEC review of the post-effective amendment is completed, the Fund has decided to suspend temporarily the sale of units in the Fund. It is the Fund's intention to resume selling shares immediately upon the effectiveness of the post-effective amendment. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits. None. (b) The following reports on Form 8-K were filed during the quarter ended June 30, 2000. The Fund did not file any reports on Form 8-K during the quarter ended June 30, 2000. The Fund changed its accounting firm from Moss Adams LLP to Rothstein, Kass & Company, P.C., as disclosed in Reports on Form 8-K filed by the Fund on October 30, 2000 and November 8, 2000. 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. The Oxbow Fund, LLC a New Jersey limited partnership By: /S/ Daniel D. Dyer Date: February 17, 2001 ---------------------------- ----------------- Daniel D. Dyer, Chairman and Chief Executive Officer By: /S/ Joseph Musumeci Date: February 20, 2001 ---------------------------------------- ----------------- Joseph Musumeci, Chief Financial Officer and Vice President OXBOW FUND, LLC (A Development Stage Company) FINANCIAL STATEMENTS AND INDEPENDENT ACCOUNTANTS' REVIEW REPORT JUNE 30, 2000 Oxbow Fund, LLC (A Development Stage Company) CONTENTS ================================================================================ Independent Accountants' Review Report F-1 Financial Statements Statement of Assets, Liabilities and Members' Deficit F-2 Statement of Operations F-3 Statement of Changes in Members' Deficit F-4 Statement of Cash Flows F-5 Notes to Financial Statements F-6 - F-9 1177 Avenue of the Americas Rothstein, Kass & Company, P.C. New York, N.Y. 10036-2714 Certified Public Accountants INDEPENDENT ACCOUNTANTS' REVIEW REPORT Board of Directors Oxbow Fund, LLC (A Development Stage Company) We have reviewed the accompanying statements of assets, liabilities and members' deficit, statements of operations, changes in members' deficit and cash flows of Oxbow Fund, LLC (a development stage company) as of June 30, 2000, and for the three months then ended and the period of September 15, 1999 (date of inception) through June 30, 2000. These financial statements are the responsibility of the Fund's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States of America, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements for them to be in conformity with auditing principles generally accepted in the United States of America. /s/ Rothstein, Kass & Company, P.C. Roseland, New Jersey January 10, 2001 F - 1 Oxbow Fund, LLC (A Development Stage Company) STATEMENT OF ASSETS, LIABILITIES AND MEMBERS' DEFICIT (UNAUDITED) ================================================================================ June 30, 2000 -------------------------------------------------------------------------------- ASSETS Cash $ 125,773 Deferred offering costs 136,058 --------- $ 261,831 ========= LIABILITIES AND MEMBERS' DEFICIT Liabilities Accounts payable $ 222,476 Accrued expenses 104,636 --------- 327,112 Members' deficit, accumulated during development stage (65,281) --------- $ 261,831 ========= Membership interest outstanding 2,180 --------- Members' deficit per unit $ (29.95) ========= See accompanying notes to financial statements. F - 2 STATEMENT OF OPERATIONS (UNAUDITED) ================================================================================ For the periods -------------------------------------------------------------------------------- September 15, Three months 1999 (date of ended inception) to June 30, June 30, 2000 2000 ------------ ------------- Expenses Officers compensation $ 75,000 $ 75,000 Professional fees 8,000 75,027 Travel 10,000 20,000 Management fees 1,376 1,376 Other 9,207 9,227 --------- --------- Net loss $(103,583) $(180,630) ========= ========= See accompanying notes to financial statements. F - 3 Oxbow Fund, LLC (A Development Stage Company) STATEMENT OF CHANGES IN MEMBERS' DEFICIT (UNAUDITED)

See accompanying notes to financial statements. F - 4 Oxbow Fund, LLC (A Development Stage Company) STATEMENT OF CASH FLOWS (UNAUDITED)

See accompanying notes to financial statements. F - 5 Oxbow Fund, LLC (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS (UNAUDITED) ================================================================================ 1. Nature of operations and summary of significant accounting policies Nature of Operations The Oxbow Fund, LLC (a development stage company) (the "Fund") is a New Jersey limited liability company organized on September 15, 1999. The Fund has elected to be regulated as a "business development company" under the Investment Company Act, which means that it is required to make certain types of investments and must offer "significant managerial assistance", as defined in the prospectus, to many of the companies in which it intends to invest. The Fund's principal investment objective is to seek long-term capital appreciation by investing primarily in securities of private U.S. companies, although the Fund may make other types of investments. The Fund's Investment Manager is C.J.M. Asset Management, LLC (the "Investment Manager"). Four Independent Directors and three persons affiliated with the Investment Manager serve as directors of the Fund. The Investment Manager is responsible for the Fund's investments, subject to the supervision of the Directors. Financial Statements The accompanying unaudited financial statements of the Fund have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by generally accepted accounting principles. All adjustments that are of a normal and recurring nature and, in the opinion of the Fund's management, necessary for a fair presentation have been included. Development Stage The Fund is in the development stage as defined in statement of Financial Accounting Standards No. 7 "Accounting and Reporting for Development Stage Enterprises". To date, the Fund has not generated revenues and devoted its efforts to various start-up activities including development and capital raising. Valuation of Investment in Private Equities Privately-placed securities will be carried at fair values determined in good faith by or under the direction of the Board of Directors. Generally, the fair value of each security will initially be based primarily upon its original cost to the Fund. Cost will be the primary factor used to determine fair value on an ongoing basis until significant developments or other factors affecting the investment (such as results of the portfolio company's operations, changes in general market conditions, subsequent financings or the availability of market quotations) provide a basis for value other than cost valuation. F - 6 Oxbow Fund, LLC (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS (UNAUDITED) ================================================================================ 1. Nature of operations and summary of significant accounting policies (continued) Deferred offering costs The Fund has deferred professional and other fees incurred in connection with a proposed public offering. If the offering is complete, these costs will be charged to members' capital (Note 5). Income taxes The Fund does not record a provision for income taxes because the individual members report their share of the Fund's income or loss on their individual income tax returns. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts disclosed in the financial statements. Actual results could differ from those estimates. 2. Members' deficit The Fund is offering up to 250,000 units of ownership interests in the Fund in an aggregate amount of up to $25,000,000. As of June 30, 2000 there were 2,180 units outstanding. The minimum investment in the Fund is 20 units at $100 per unit. The units are being offered and sold through C.J.M. Planning Corp., a registered Broker-Dealer and an affiliate of the Investment Manager, who receives a 7% sales charge per unit sold. The offering will terminate on August 31, 2001, unless terminated earlier at the discretion of the Fund's Board of Directors. The Fund's fiscal year-end is December 31. The Fund will continue until March 31, 2010, subject to the right of the Fund's Board of Directors to extend the term for up to two additional two-year periods. As of June 30, 2000, the Fund has incurred approximately $230,000 of offering costs of which approximately $94,000 has been allocated to the 2,180 units of issued capital and approximately $136,000, has been deferred. F - 7 Oxbow Fund, LLC (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS (UNAUDITED) ================================================================================ 3. Investment advisory and operating agreements The Investment Manager is responsible for oversight of asset management and administration of the Fund. The Fund pays the Investment Manager an annual management fee equal to 2.5% of total investor "adjusted capital contributions", as defined in the prospectus, payable quarterly in arrears. The Fund will also pay the Investment Manager an annual fee for its services as fund administrator which will equal approximately .25% of total investor "adjusted capital contributions", as defined in the prospectus. Additionally, after the members (including the Investment Manager) have received aggregate distributions from the Fund equal to the amount of their initial investments in the Fund, the Fund will pay the Investment Manager an "incentive fee", as defined in the prospectus. The incentive fee will become payable commencing with the fiscal year of the Fund during which members have received such distributions equal to their initial investments and for each fiscal year thereafter. The amount of the fee will equal 20% of the taxable income of the Fund during the relevant fiscal year (calculated without giving effect to payment of the incentive fee) less unrealized capital depreciation for the year. For the three months ended June 30, 2000 and the period of September 15, 1999 (date of inception) through June 30, 2000, accrued management fees payable to the Investment manager were approximately $1,400. 4. Restatement of unaudited As previously reported in the Fund's June financial statements 30, 2000 unaudited financial statements included in Form 10-Q, filed on August 14, 2000, the Fund charged all professional fees in connection with the offering to operations. The Fund has now determined that those fees should have been charged directly to equity or deferred. Also, additional accruals were made to capture all expenses that were incurred prior to June 30, 2000. Net loss previously reported of $83,093 was reduced by $102,651 and charged to members' equity. The net loss was further reduced by $136,058 and capitalized as deferred offering costs. In addition, accruals of $336,246 where made for additional expenses uncovered during the review. As a result, the June 30, 2000 unaudited financial statements have been restated from amounts previously reported to properly reflect these transactions. F - 8 Oxbow Fund, LLC (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS (UNAUDITED) ================================================================================ 4. Restatement of unaudited financial statements (continued) A summary of the significant effects of the restatement is as follows: As Previously As Reported Restated June 30, 2000 Assets: Cash $ 125,773 $ 125,773 Prepaid expenses 9,207 Deferred offering costs 136,058 --------------------------- $ 134,980 $ 261,831 =========================== Liabilities: Accounts payable $ 235,341 $ 222,476 Accrued expenses 104,636 --------------------------- 235,341 327,112 Members' deficit (100,361) (65,281) --------------------------- $ 134,980 $ 261,831 =========================== September 15, 1999 (Date of Inception) to June 30, 2000 Net loss $ (83,093) $(180,630) =========================== Membership interest outstanding 2,180 2,180 --------------------------- Net loss per unit $ (38.12) $ (82.86) =========================== 5. Subsequent event As of October 31, 2000, the Fund has issued an additional 9,774 units of members' capital resulting in net proceeds of approximately $909,000. F - 9

OXBOW FUND LLC 10-Q/A