UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-QSB

(Mark one)
[X} Quarterly Report Under Section 13 or 15(d) of The Securities Exchange
    Act of 1934

    For the quarterly period ended June 30, 2002

[ ] Transition Report Under Section 13 or 15(d) of The Securities Exchange
    Act of 1934

         For the transition period from ______________ to _____________

                         Commission File Number: 0-32829


                            PALOMAR ENTERPRISES, INC.
        (Exact name of small business issuer as specified in its charter)


       Nevada                                                  88-0470235
(State of incorporation)                                (IRS Employer ID Number)


              7898 E. Acoma Drive, Suite 209, Scottsdale, AZ 85260
                    (Address of principal executive offices)


                                 (480) 444-0081
                           (Issuer's telephone number)


             8930 E. Raintree Drive, Suite 100, Scottsdale, AZ 85260
              (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 Section
13 or 15(d) of the  Exchange  Act during the past 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 [ ]

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: July 30, 2002: 9,990,000

Transitional Small Business Disclosure Format (check one): YES  [ ]  NO [X]
<PAGE>
                            PALOMAR ENTERPRISES, INC.

                 Form 10-QSB for the Quarter ended June 30, 2002

                                Table of Contents

                                                                         Page
                                                                         ----
PART I - FINANCIAL INFORMATION

   Item 1 - Financial Statements                                           3

   Item 2 - Management's Discussion and Analysis or Plan of Operation     11

PART II - OTHER INFORMATION

   Item 1 - Legal Proceedings                                             14

   Item 2 - Changes in Securities                                         14

   Item 3 - Defaults on Senior Securities                                 14

   Item 4 - Submission of Matters to a Vote of Security Holders           14

   Item 5 - Other Information                                             14

   Item 6 - Exhibits and Reports on Form 8-K                              14


SIGNATURES                                                                14

                                       2
<PAGE>
ITEM 1 - PART 1 - FINANCIAL STATEMENTS

                            PALOMAR ENTERPRISES, INC.
                          (a development stage company)

                                 BALANCE SHEETS
                             June 30, 2002 and 2001

                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                               June 30,         June 30,
                                                                                 2002             2001
                                                                               --------         --------
<S>                                                                            <C>              <C>
                                     ASSETS
CURRENT ASSETS
  Cash on hand and in bank                                                     $  6,342         $  2,918
  Advances due from officers and affiliated entities                             19,500               --
  Prepaid expenses                                                                4,378               --
                                                                               --------         --------

       TOTAL CURRENT ASSETS                                                      30,220            2,918
                                                                               --------         --------

OTHER ASSETS
  Deposits and other                                                              2,423               --
                                                                               --------         --------

TOTAL ASSETS                                                                   $ 32,643         $  2,918
                                                                               ========         ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable - trade                                                     $    520         $     --
                                                                               --------         --------

       TOTAL CURRENT LIABILITIES                                                    520               --
                                                                               --------         --------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
  Common stock - $0.001 par value. 50,000,000 shares authorized
   9,990,000 and 9,440,000 shares issued and outstanding, respectively            9,990            9,440
  Additional paid-in capital                                                     56,810            2,360
  Deficit accumulated during the development phase                              (34,677)          (8,882)
                                                                               --------         --------

       TOTAL STOCKHOLDERS' EQUITY                                                32,123            2,918
                                                                               --------         --------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                     $ 32,643         $  2,918
                                                                               ========         ========
</TABLE>

The financial  information  presented  herein has been  prepared  by  management
without audit by independent certified public accountants.

The accompanying notes are an integral part of these financial statements.

                                       3
<PAGE>
                            PALOMAR ENTERPRISES, INC.
                          (a development stage company)

                 STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
               Six and Three months ended March 31, 2002 and 2001
               and Period from March 10, 1999 (date of inception)
                              through June 30, 2002

                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                                      Period from
                                                                                                     March 11, 1999
                                Six months       Six months       Three months     Three months   (date of inception)
                                  ended            ended             ended             ended            through
                              June 30, 2002    June 30, 2001     June 30, 2002     June 30, 2001     June 30, 2002
                              -------------    -------------     -------------     -------------     -------------
<S>                         <C>                <C>               <C>                 <C>            <C>
REVENUES                      $        --       $        --       $        --       $        --       $        --
                              -----------       -----------       -----------       -----------       -----------

OPERATING EXPENSES
  Rent to affiliated entity        10,000                --            10,000                --            10,000
  Consulting, legal
   and professional fees           11,211             1,239             8,848               239            13,370
  Other general and
   administrative expenses          1,666             1,337             1,666               358            11,307
                              -----------       -----------       -----------       -----------       -----------
TOTAL OPERATING EXPENSES           22,877             2,576            20,514               597            34,677
                              -----------       -----------       -----------       -----------       -----------

LOSS FROM OPERATIONS              (22,877)           (2,576)          (20,514)             (597)          (34,877)

OTHER INCOME                           --                --                --                --                --
                              -----------       -----------       -----------       -----------       -----------
LOSS BEFORE PROVISION
 FOR INCOME TAXES                 (22,877)           (2,576)          (20,514)             (597)          (34,877)

PROVISION FOR INCOME TAXES             --                --                --                --                --
                              -----------       -----------       -----------       -----------       -----------

NET LOSS                          (22,877)           (2,576)          (20,514)             (597)          (34,877)

OTHER COMPREHENSIVE
   INCOME                              --                --                --                --                --
                              -----------       -----------       -----------       -----------       -----------

COMPREHENSIVE LOSS            $   (22,877)      $    (2,576)      $   (20,514)      $      (577)      $   (34,877)
                              ===========       ===========       ===========       ===========       ===========

Net loss per weighted-average
 share of common stock
 outstanding,  calculated on
 Net Loss - basic and fully
 diluted                              nil               nil               nil               nil       $     (0.01)
                              ===========       ===========       ===========       ===========       ===========

Weighted-average number
 of shares of common
 stock outstanding              9,520,110         9,440,000         9,599,341         9,440,000         5,749,345
                              ===========       ===========       ===========       ===========       ===========
</TABLE>
The financial  information  presented  herein has been  prepared  by  management
without audit by independent certified public accountants.

The accompanying notes are an integral part of these financial statements.

                                       4
<PAGE>
                            PALOMAR ENTERPRISES, INC.
                          (a development stage company)

                            STATEMENTS OF CASH FLOWS
                   Six months ended June 30, 2002 and 2001 and
             Period from March 10, 1999 (date of inception) through
                                  June 30, 2002

                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                            Period from
                                                                                           March 10, 1999
                                                         Six months        Six months    (date of inception)
                                                            ended            ended            through
                                                        June 30, 2002     June 30, 2001    June 30, 2002
                                                        -------------     -------------    -------------
<S>                                                        <C>              <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net loss for the period                                  $(22,877)        $ (2,576)        $(34,677)
  Adjustments to reconcile net loss to net
   cash provided by operating activities
    Depreciation                                                 --               --               --
    Common stock issued for services                             --               --            6,000
    (Increase) Decrease in Prepaid expenses                  (4,378)              --           (4,378)
    Security deposits                                        (2,423)              --           (2,423)
    Increase (Decrease) in Accounts payable - trade             520               --              520
                                                           --------         --------         --------

NET CASH USED IN OPERATING ACTIVITIES                       (29,158)          (2,576)         (34,958)
                                                           --------         --------         --------
CASH FLOWS FROM INVESTING ACTIVITIES
  Cash advances to officers and affiliated entities         (19,500)              --          (19,500)
                                                           --------         --------         --------
CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from sales of common stock                        55,000               --           60,800
                                                           --------         --------         --------

NET CASH USED IN FINANCING ACTIVITIES                        55,000               --           60,800
                                                           --------         --------         --------

INCREASE (DECREASE) IN CASH                                   6,342           (2,576)           6,342

Cash at beginning of period                                      --            5,494               --
                                                           --------         --------         --------

CASH AT END OF PERIOD                                      $  6,342         $  2,918         $  6,342
                                                           ========         ========         ========

SUPPLEMENTAL DISCLOSURE OF INTEREST AND
INCOME TAXES PAID
  Interest paid for the period                             $     --         $     --         $     --
                                                           ========         ========         ========
  Income taxes paid for the period                         $     --         $     --         $     --
                                                           ========         ========         ========
</TABLE>
The financial  information  presented  herein has been  prepared  by  management
without audit by independent certified public accountants.

The accompanying notes are an integral part of these financial statements.

                                       5
<PAGE>
                            PALOMAR ENTERPRISES, INC.
                          (a development stage company)

                          NOTES TO FINANCIAL STATEMENTS


NOTE A - ORGANIZATION AND DESCRIPTION OF BUSINESS

Palomar  Enterprises,  Inc.  (Company)  was  incorporated  on March 10,  1999 in
accordance  with the laws of the State of  Nevada.  The  Company  was  initially
formed for the purpose of  developing  an aircraft  service  company for private
aircraft  owners that would offer on-site  preventative  maintenance  and repair
services.  The Company has had no substantial  operations or substantial  assets
since inception.

In November  2001, the Company  abandoned the initial  business plan and adopted
one whereby the Company will obtain  non-performing  debt owed by debtors  which
allegedly cannot be located from unrelated third-party  financial  institutions.
The  Company   anticipates   using  the  services  of  various  debtor  location
organizations to aid in the collection of the acquired debt. As of June 30, 2002
and subsequent  thereto,  the Company has not reached an operational  level with
this business plan.

Due to the  lack  of  sustaining  operations  from  inception,  the  Company  is
considered in the  development  stage and, as such, has generated no significant
operating revenues and has incurred cumulative operating losses of approximately
$35,000.

The  Company  follows  the  accrual  basis  of  accounting  in  accordance  with
accounting principles generally accepted in the United States of America and has
adopted a year-end of December 31.

During interim periods, the Company follows the accounting policies set forth in
its annual  audited  financial  statements  filed with the U. S.  Securities and
Exchange  Commission  on its  Annual  Report on Form  10-KSB  for the year ended
December 31, 2001.  The  information  presented  within these interim  financial
statements  may not  include all  disclosures  required  by  generally  accepted
accounting  principles  and the  users of  financial  information  provided  for
interim periods should refer to the annual  financial  information and footnotes
when reviewing the interim financial results presented herein.

In the opinion of management,  the accompanying  interim  financial  statements,
prepared in  accordance  with the U. S.  Securities  and  Exchange  Commission's
instructions   for  Form  10-QSB,   are   unaudited  and  contain  all  material
adjustments,  consisting  only of  normal  recurring  adjustments  necessary  to
present fairly the financial condition,  results of operations and cash flows of
the Company for the respective  interim  periods  presented.  The current period
results of operations are not necessarily indicative of results which ultimately
will be reported for the full fiscal year ending December 31, 2002.

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

NOTE B - GOING CONCERN UNCERTAINTY

The Company is fully  dependent  upon either  future sales of securities or upon
its current management and/or advances or loans from controlling shareholders or
corporate  officers  to  provide  sufficient  working  capital to  preserve  the
integrity of the corporate entity during the development phase.

                                       6
<PAGE>
                            PALOMAR ENTERPRISES, INC.
                          (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED


NOTE B - GOING CONCERN UNCERTAINTY - CONTINUED

There is no assurance that the Company will be able to obtain additional funding
through the sales of additional  securities or, that such funding, if available,
will be obtained on terms  favorable to or affordable by the Company.  It is the
intent of management and controlling  shareholders to provide sufficient working
capital necessary to support and preserve the integrity of the corporate entity.

However,  there is no legal obligation for either management and/or  controlling
shareholders to provide such additional funding.


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. CASH AND CASH EQUIVALENTS

   The Company  considers all cash on hand and in banks,  including  accounts in
   book overdraft  positions,  certificates  of deposit and other  highly-liquid
   investments  with maturities of three months or less,  when purchased,  to be
   cash and cash equivalents.

2. ORGANIZATION COSTS

   The Company has adopted the  provisions of AICPA  Statement of Position 98-5,
   "Reporting on the Costs of Start-Up  Activities" whereby all organization and
   initial costs incurred with the incorporation  and initial  capitalization of
   the Company were charged to operations as incurred.

3. RESEARCH AND DEVELOPMENT EXPENSES

   Research and development expenses are charged to operations as incurred.

4. ADVERTISING EXPENSES

   Advertising and marketing expenses are charged to operations as incurred.

5. INCOME TAXES

   The Company  utilizes the asset and liability method of accounting for income
   taxes.  At June 30, 2002 and 2001,  the  deferred  tax asset and deferred tax
   liability  accounts,  as recorded when  material,  are entirely the result of
   temporary  differences.  Temporary  differences  represent differences in the
   recognition  of  assets  and  liabilities  for  tax and  financial  reporting
   purposes, primarily accumulated depreciation and amortization. As of June 30,
   2002 and 2001, respectively,  the deferred tax asset is related solely to the
   Company's net operating loss carryforward and is fully reserved.

                                       7
<PAGE>
                            PALOMAR ENTERPRISES, INC.
                          (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

6. EARNINGS (LOSS) PER SHARE

   Basic earnings (loss) per share is computed by dividing the net income (loss)
   by the  weighted-average  number of shares of common  stock and common  stock
   equivalents  (primarily  outstanding  options  and  warrants).  Common  stock
   equivalents  represent  the  dilutive  effect of the assumed  exercise of the
   outstanding stock options and warrants,  using the treasury stock method. The
   calculation of fully diluted  earnings  (loss) per share assumes the dilutive
   effect of the  exercise of  outstanding  options  and  warrants at either the
   beginning  of the  respective  period  presented  or the  date  of  issuance,
   whichever is later. As of June 30, 2002, the Company's  outstanding  warrants
   are  considered  anti-dilutive  due  to  the  Company's  net  operating  loss
   position.  At June 30,  2002,  the  Company had no  warrants  and/or  options
   outstanding.

NOTE D - FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amount of cash,  accounts  receivable,  accounts  payable and notes
payable, as applicable,  approximates fair value due to the short term nature of
these items  and/or the current  interest  rates  payable in relation to current
market conditions.

NOTE E - ADVANCES DUE FROM OFFICERS AND AFFILIATED ENTITIES

During  June 2002,  subsequent  to the sale of equity  securities,  the  Company
advanced an aggregate of $19,500 to affiliated  entities and corporate  officers
as follows:  Energy River Corporation - $11,000;  FutureCarz,  Inc. - $7,500 and
Terry Neild - $1,000. These advances are non-interest bearing and repayable upon
demand.

NOTE F - INCOME TAXES

The components of income tax (benefit) expense for the six months ended June 30,
2002 and 2001 and for the period from March 10, 1999 (date of inception) through
June 30, 2002, respectively, are as follows:

                                                                Period from
                                                              March 10, 1999
                         Six months         Six months     (date of inception)
                           ended              ended              through
                       June 30, 2002       June 30, 2001       June 30, 2002
                       -------------       -------------       -------------
     Federal:
       Current             $    --            $    --            $    --
       Deferred                 --                 --                 --
                           -------            -------            -------
     State:
       Current                  --                 --                 --
       Deferred                 --                 --                 --
                           -------            -------            -------

       Total               $    --            $    --            $    --
                           =======            =======            =======

                                       8
<PAGE>
                            PALOMAR ENTERPRISES, INC.
                          (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED


NOTE F - INCOME TAXES - CONTINUED

As of June 30,  2002,  the  Company has a net  operating  loss  carryforward  of
approximately  $35,000  to offset  future  taxable  income.  Subject  to current
regulations,  this  carryforward  will  begin to expire in 2015.  The amount and
availability  of  the  net  operating  loss  carryforwards  may  be  subject  to
limitations set forth by the Internal  Revenue Code.  Factors such as the number
of shares ultimately issued within a three year look-back period;  whether there
is a deemed more than 50 percent change in control; the applicable long-term tax
exempt bond rate;  continuity of historical  business;  and subsequent income of
the  Company  all  enter  into  the  annual   computation  of  allowable  annual
utilization of the carryforwards.

The  Company's  income tax expense  (benefit)  for the six months ended June 30,
2002 and 2001 and for the period from March 10, 1999 (date of inception) through
June 30, 2002,  respectively,  differed  from the  statutory  federal rate of 34
percent as follows:

<TABLE>
<CAPTION>
                                                                                                 Period from
                                                                                                March 10, 1999
                                                               Six months       Six months    (date of inception)
                                                                 ended             ended           through
                                                             June 30, 2002     June 30, 2001    June 30, 2002
                                                             -------------     -------------    -------------
<S>                                                          <C>              <C>              <C>
     Statutory rate applied to loss before income taxes         $ (7,800)        $   (875)        $(11,800)
     Increase (decrease) in income taxes resulting from:
       State income taxes                                             --               --               --
       Other, including reserve for deferred tax asset             7,800              875           11,800
                                                                --------         --------         --------

           Income tax expense                                   $     --         $     --         $     --
                                                                ========         ========         ========
</TABLE>

Temporary  differences,  consisting primarily of statutory deferrals of expenses
for organizational costs and statutory  differences in the depreciable lives for
property and equipment, between the financial statement carrying amounts and tax
bases of assets and liabilities give rise to deferred tax assets and liabilities
as of June 30, 2002 and 2001, respectively:

                                                 June 30,         June 30,
                                                   2002             2001
                                                 --------         --------
     Deferred tax assets
       Net operating loss carryforwards          $ 11,800         $  3,020
       Less valuation allowance                   (11,800)          (3,020)
                                                 --------         --------

     Net Deferred Tax Asset                      $     --         $     --
                                                 ========         ========

During the six months ended June 30, 2002 and 2001, the reserve for the deferred
current tax asset increased by approximately $7,780 and $875, respectively.


                (Remainder of this page left blank intentionally)

                                       9
<PAGE>
                            PALOMAR ENTERPRISES, INC.
                          (a development stage company)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED


NOTE G - CAPITAL STOCK TRANSACTIONS

On May 15, 2002, the Company issued a Private  Placement  Memorandum to offer to
accredited  investors up to 2,500,000  Units at a price of $0.10 per Unit.  Each
unit shall consist of one (1) share of restricted, unregistered common stock and
a warrant to purchase an additional share at a price of $1.00 per share.

In May and June 2002,  pursuant to a Private Placement  Memorandum dated May 15,
2002, the Company sold an aggregate  550,000 shares of restricted,  unregistered
common stock at a price of $0.10 per share for gross proceeds of $55,000.

NOTE H - STOCK WARRANTS

In May and June 2002, in connection with the sale of Units pursuant to a Private
Placement Memorandum, dated May 15, 2002, the Company issued stock warrants (PPM
Warrants) to the  purchasers of 550,000 shares of common stock to purchase up to
an additional 550,000 shares of restricted, unregistered common stock at a price
of $1.00 per share.

                                 Warrants         Warrants
                                originally     outstanding at
                                  issued        June 30, 2002     Exercise price
                                  ------        -------------     --------------

     PPM Warrants                 550,000          550,000       $1.00 per share
                                  -------          -------

     Totals at June 30, 2002      550,000          550,000
                                  =======          =======

                (Remainder of this page left blank intentionally)

                                       10
<PAGE>
PART I - ITEM 2

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

(1) CAUTION REGARDING FORWARD-LOOKING INFORMATION

Certain  statements  contained  in this  quarterly  filing,  including,  without
limitation, statements containing the words "believes", "anticipates", "expects"
and  words  of  similar  import,  constitute  forward_looking  statements.  Such
forward_looking  statements  involve known and unknown risks,  uncertainties and
other factors that may cause the actual results,  performance or achievements of
the Company,  or industry  results,  to be materially  different from any future
results,   performance   or   achievements   expressed   or   implied   by  such
forward_looking statements.

Such factors include, among others, the following:  international,  national and
local general economic and market conditions:  demographic  changes; the ability
of the Company to sustain,  manage or  forecast  its growth;  the ability of the
Company to successfully make and integrate acquisitions;  raw material costs and
availability;  new product  development and  introduction;  existing  government
regulations  and  changes  in,  or  the  failure  to  comply  with,   government
regulations;  adverse publicity;  competition; the loss of significant customers
or suppliers;  fluctuations  and  difficulty in forecasting  operating  results;
changes in business strategy or development  plans;  business  disruptions;  the
ability  to attract  and  retain  qualified  personnel;  the  ability to protect
technology; and other factors referenced in this and previous filings.

Given  these  uncertainties,  readers  of this Form  10_QSB  and  investors  are
cautioned not to place undue reliance on such  forward_looking  statements.  The
Company  disclaims  any  obligation  to update any such  factors or to  publicly
announce the result of any  revisions to any of the  forward_looking  statements
contained herein to reflect future events or developments.

(2) GENERAL

Palomar  Enterprises,  Inc. was incorporated in Nevada on March 10, 1999 for the
purpose of developing an aircraft  service  company for private  aircraft owners
that would offer on-site preventative maintenance and repair services.

Palomar initially intended to enter the aircraft inspection and repair business.
According to research  conducted by Industrial  Maintenance  & Plant  Operation,
aircraft  maintenance  has  shifted in focus from  overhaul  to  inspection  and
repair.  Successful aircraft  maintenance is a combination of strict scheduling,
meticulous documentation,  preventative and predictive measures and adherence to
FAA regulations.  Maintenance programs for new aircraft are developed along with
Reliability  Centered Maintenance (RCM) plans. RCM is based upon the probability
that an item will survive  without  failure to a specific  operating  age, under
specified  operating  conditions  and  under  a  strict  maintenance   schedule.
Predictive  maintenance  techniques  provide  valuable insight into an airplanes
long-term health and preventative activities keep it safe and reliable.

During the initial  phase of this  business  plan,  we completed  the process of
registering our securities with the Securities and Exchange  Commission in order
to make our  financial  information  equally  available  to  investors  or other
interested  parties.  In the next phase of our business,  we planned to obtain a
listing  for  public  trading  of our stock on the Over the  Counter  Electronic
Bulletin  Board and seek capital of $2,000,000  through the sale of common stock
in a private  placement.  While we believe we have made good faith  estimates of
Palomar's  ability to secure additional  capital,  there is no guarantee that we
will receive sufficient funding to implement any future business plan steps.

We received  our initial  funding of $5,800  through the sale of common stock to
investors from the period of  approximately  August 1, 2000 until  September 30,
2000.  We offered  and sold  58,000  common  stock  shares at $0.10 per share to
non-affiliated private investors.  From inception until the date of this filing,
we have had no material operating  activities.  Our audited financial statements
for the period from March 10,  1999 (our date of  inception)  through  March 31,
2002 report no cumulative  revenues and a cumulative  net loss of  approximately
$14,000.

                                       11
<PAGE>
In October 2001, we issued a Press Release announcing "Palomar Enterprises, Inc.
launches new debt acquisition business". On November 26, 2001, we issued a Press
Release announcing "Palomar Enterprises, Inc. appoints Arnold Wenzloff President
and COO of New Debt  Acquisition  Venture  d/b/a Regency  Horizon  Corporation".
Further,  on January 24, 2002,  the Company  issued a Press  Release  announcing
"Palomar  Enterprises,  Inc. appoints Carl MacBride and Kyle Arneson to Board of
New Debt Acquisition Venture d/b/a Regency Horizon  Corporation;  Terry W. Neild
steps down as Interim President"

With these  announcements,  we  abandoned  the  aircraft  inspection  and repair
business and Terry Westergard resigned as a corporate officer and director.

On December 5, 2001,  we issued an aggregate  3,000,000  shares to Mr.  MacBride
(2,000,000  shares) and Mr. Arneson (1,000,000 shares) in escrow in anticipation
of a business combination transaction with a newly-formed  corporation,  Regency
Horizon Corporation.  Regency Horizon Corporation,  wholly-owned by MacBride and
Arneson,  was formed to create funding to acquire a portfolio of  non-performing
debt of previously  non-locatable debtors from unrelated financial  institutions
at a  discounted  amount.  Regency  Horizon  intended to build its  portfolio of
acquired debt, and through managing collections, return exceptional profits on a
proportionally  small capital investment.  Regency Horizon also had an agreement
to utilize the services of People Locator,  Inc., a debtor information  provider
for non-locatable  debtors controlled by MacBride. On February 6, 2002, we filed
a Current Report on Form 8-K to report this information.

On April 15, 2002,  we filed a Current  Report on Form 8-K to disclose  that the
proposed business  combination  transaction with Regency Horizon Corporation was
abandoned by mutual consent of all affiliated  parties and the 3,000,000  shares
issued to Mr. MacBride and Mr. Arneson in escrow in anticipation of the business
combination transaction were returned to the Company,  cancelled and returned to
unissued status.

As a result of the April 15, 2002 events,  Anthony Wiser resigned as a member of
our Board of Directors and as a corporate officer.  Terry W. Neild was appointed
as our sole officer and member of the Board of Directors.

We intend to continue  with the business plan of acquiring  non-performing  debt
from  financial  institutions  and use the services of various  debtor  location
services to attempt collection of these purchased amounts.

We also  intend to comply  with the  periodical  reporting  requirements  of the
Securities  Exchange Act of 1934 and to seek to complete a business  acquisition
transaction.

During  the  period  before we fully  develop  our  business  plan and  commence
operations,  we may be referred to as a shell corporation and as we trade on the
NASD  Bulletin  Board,  a  trading  and  reporting  shell   corporation.   Shell
corporations  have zero or nominal  assets and typically no stated or contingent
liabilities.  Private  companies  wishing to become publicly trading may wish to
merge with a shell (a reverse  merger)  whereby the  shareholders of the private
Company become the majority of the  shareholders  of the combined  Company.  The
private  Company may  purchase  for cash all or a portion of the common share of
the shell  corporation  from its major  stockholders.  Typically,  the Board and
officers  of the  private  Company  become  the new  Board and  officers  of the
combined  Company and often the name of the private  Company becomes the name of
the combined Company.

The Company has very limited  capital,  and it is unlikely that the Company will
be able to take  advantage  of more  than one  such  business  opportunity.  The
Company intends to seek  opportunities  demonstrating the potential of long-term
growth as opposed to short-term  earnings.  At the present time, the Company has
not identified  any business  opportunity  that it plans to pursue,  nor has the
Company  reached  any  agreement  or  definitive  understanding  with any person
concerning an acquisition.

(3) RESULTS OF OPERATIONS, LIQUIDITY AND CAPITAL RESOURCES

The Company had no operating  revenue  during the  respective  six month periods
ended  June 30,  2002 and 2001 and for the period  from March 10,  1999 (date of
inception) through June 30, 2002, respectively.

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<PAGE>
General and  administrative  expenses for the six month  periods  ended June 30,
2002 and 2001 were approximately $23,000 and $2,600, respectively.  Net loss for
these periods was approximately  $(23,000) and $(2,600).  Earnings per share for
the six months ended June 30, 2002 and 2001,  was nil for each period.  Included
in  operating  expenses for the three months ended June 30, 2002 is $10,000 paid
to an entity controlled by a member of the Company's Board of Directors.

The  Company  does not  expect  to  generate  any  meaningful  revenue  or incur
operating  expenses for purposes  other than  fulfilling  the  obligations  of a
reporting  company  under The  Securities  Exchange Act of 1934 unless and until
such time that the Company begins meaningful operations.

At June 30, 2002 and 2001,  respectively,  the  Company  had working  capital of
approximately $29,700 and $2,900.

During  June 2002,  subsequent  to the sale of equity  securities,  the  Company
advanced an  aggregate  of $19,500 to  affiliated  individuals  and  entities as
follows: Energy River Corporation - $11,000; FutureCarz, Inc. - $7,500 and Terry
Neild - $1,000.  These  advances are  non-interest  bearing and  repayable  upon
demand.

It  is  the  intent  of  management  and  significant  stockholders  to  provide
sufficient  working  capital,  when  necessary,  to  support  and  preserve  the
integrity of the corporate  entity.  However,  there is no legal  obligation for
either  management or  significant  stockholders  to provide  additional  future
funding.  Should  this  pledge  fail to provide  financing,  the Company has not
identified any alternative  sources.  Consequently,  there is substantial  doubt
about the Company's ability to continue as a going concern.

The  Company's  need for  capital  may  change  dramatically  as a result of the
implementation of the Company's  business plan or the initiation of any business
acquisition  or  combination  transaction.  There can be no  assurance  that the
Company will identify any such business, product, technology or company suitable
for  acquisition  in the future.  Further,  there can be no  assurance  that the
Company would be successful in  consummating  any acquisition on favorable terms
or that it will be able to profitably manage the business,  product,  technology
or company it acquires.

The current  management  group may also seek,  investigate  and,  if  warranted,
acquire an interest in one or more business opportunities or ventures. As of the
date  hereof,   the  Company  has  no  operating  assets  and  has  no  business
opportunities  or ventures under  contemplation  for acquisition but proposes to
investigate  potential  opportunities  in the form of investors or entrepreneurs
with a concept  which has not yet been  placed in  operation,  or in the form of
firms which are  developing  companies in need of limited  additional  funds for
expansion into new products or services,  and which are seeking to develop a new
product or service.  The Company may also seek out established  businesses which
may be experiencing financial or operational difficulties and are in need of the
limited  additional capital the Company could provide.  The Company  anticipates
that it will seek to merge with an  existing  business.  After the  merger,  the
surviving  entity will be the  Company;  however,  management  from the acquired
entity will in all likelihood  operate the Company.  There is, however, a remote
possibility  that the  Company  may  seek to  acquire  and  operate  an  ongoing
business,  in which case the existing  management might be retained.  Due to the
absence  of  capital  available  for  investment  by the  Company,  the types of
businesses  seeking to be acquired  by the Company  will no doubt be smaller and
higher risks of  businesses.  In all  likelihood,  a business  opportunity  will
involve  the  acquisition  of or merger with a  corporation  which does not need
additional  cash but which desires to establish a public  trading market for its
Common  Stock.  Accordingly,  the  Company's  ability to acquire any business of
substance may be extremely limited.

                                       13
<PAGE>
                          PART II - OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

     None

ITEM 2 - CHANGES IN SECURITIES

On May 15, 2002, the Company issued a Private  Placement  Memorandum to offer to
accredited  investors up to 2,500,000  Units at a price of $0.10 per Unit.  Each
Unit shall consist of one (1) share of restricted, unregistered common stock and
a warrant to purchase an additional share at a price of $1.00 per share.

On May 22, 2002,  the Company  sold 25,000  shares of  restricted,  unregistered
common  stock and issued  25,000  warrants to purchase  an  additional  share of
restricted,  unregistered  common  stock at a price of $1.00  per share to Chris
Mendoza,  pursuant to a Private  Placement  Memorandum  dated May 15, 2002, at a
price of $0.10 per Unit for gross proceeds of $2,500.

On May 22, 2002,  the Company  sold 25,000  shares of  restricted,  unregistered
common  stock and issued  25,000  warrants to purchase  an  additional  share of
restricted, unregistered common stock at a price of $1.00 per share to Al Mayor,
pursuant to a Private  Placement  Memorandum  dated May 15, 2002,  at a price of
$0.10 per Unit for gross proceeds of $2,500.

On June 6, 2002,  the Company sold 500,000  shares of  restricted,  unregistered
common  stock and issued  500,000  warrants to purchase an  additional  share of
restricted,  unregistered  common  stock at a price of $1.00 per share to George
Howard,  pursuant to a Private  Placement  Memorandum  dated May 15, 2002,  at a
price of $0.10 per Unit for gross proceeds of $50,000.

ITEM 3 - DEFAULTS ON 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

     Exhibits - None

     Reports on Form 8-K - None

                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                          PALOMAR ENTERPRISES, INC.

Dated: July 30, 2002                      By: /s/ Terry W. Neild
       -------------                         -----------------------------------
                                                                  Terry W. Neild
                                              President, Chief Executive Officer
                                                    and Chief Accounting Officer

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