Form 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549


[X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

For the quarterly period ended                 March 31, 1999                  
                              --------------------------------------------------

                                       OR

[ ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
       EXCHANGE ACT OF 1934

For the transition period from                         to                
                               -----------------------    ----------------------

                  -------------------------------------------

For Quarter Ended March 31, 1999                  Commission File Number 811-407
                  --------------                                         -------

                          1150 LIQUIDATING CORPORATION
                             (formerly SBM Company)
             (Exact name of registrant as specified in its charter)

                MINNESOTA                                 41-0557530   
----------------------------------------       ---------------------------------
    (State or other jurisdiction of            (IRS Employer Identification No.)
     incorporation or organization)

             4440 IDS Center
         Minneapolis, Minnesota                              55402    
----------------------------------------       ---------------------------------
(Address of principal executive offices)                  (Zip Code)

Registrant's telephone number, including area code       (612) 338-5254    
                                                  ------------------------------


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 ___

2,179,714 Common Shares were outstanding as of March 31, 1999
---------


<PAGE>


                          1150 LIQUIDATING CORPORATION


                                    I N D E X


                                                                            Page

PART I.   FINANCIAL INFORMATION

   Item 1.   Financial Statements (Unaudited)

                   Statements of Net Assets in Liquidation                    1

                   Statement of Changes in Net Assets in Liquidation          2

                   Notes to Condensed Financial Statements                  3-6


   Item 2.   Management's Discussion and Analysis of Financial
                Condition and Changes in Net Assets in Liquidation            7


PART II.  OTHER INFORMATION                                                 8-9


<PAGE>


                          Part I. FINANCIAL INFORMATION
                          Item 1. FINANCIAL STATEMENTS

                          1150 LIQUIDATING CORPORATION
                     (formerly SBM COMPANY AND SUBSIDIARIES)

                     STATEMENT OF NET ASSETS IN LIQUIDATION
<TABLE>
<CAPTION>
                                                                   March 31,     December 31,
                                                                     1999            1998        
                                                                  ----------      ----------
                   ASSETS                                        (Unaudited)       (Audited)
<S>                                                               <C>             <C>       
Cash and cash equivalents                                         $  746,024      $  819,931
Federal income tax refund                                             70,000          70,000
Other assets                                                           2,611             412
                                                                  ----------      ----------
            Total assets                                             818,635         890,343

                 LIABILITIES

Reserve for post-dissolution expenses                                 15,000              --
Accounts payable                                                      80,395          83,814
Reserve for estimated costs during the period of liquidation          36,073          86,358
                                                                  ----------      ----------
            Total liabilities                                        131,468         170,172

Common stock held by employee benefit plans
   or plan participants - 304,693 shares (see Note 2)                121,932         126,545
                                                                  ----------      ----------

            Net assets                                            $  565,235      $  593,626
                                                                  ==========      ==========

Common shares outstanding - 2,179,714 less 304,693 shares
   held by employee benefit plans or plan participants             1,875,021       1,875,021
                                                                  ==========      ==========

Net assets per common share outstanding                           $      .30      $      .32
                                                                  ==========      ==========
</TABLE>

See Notes to Financial Statements.


                                       1
<PAGE>


                          1150 LIQUIDATING CORPORATION

                STATEMENT OF CHANGES IN NET ASSETS IN LIQUIDATION
             For the Period from December 31, 1994 to March 31, 1999

<TABLE>
<CAPTION>

<S>                                                                                     <C>          
NET ASSETS (DEFICIT) AT DECEMBER 31, 1994                                               $(31,976,759)

Income from liquidating activities                                                        42,662,596

Preferred stock liquidation amount in excess
     of carrying value                                                                    (1,279,805)

Common stock dividend distribution - $2.75 per share                                      (5,994,214)

Allocation of common stock dividend distribution to
     common stock held by employee benefit plans                                             837,906

Allocation of net loss and carrying value to common
     stock held by employee benefit plans                                                    442,472
                                                                                        ------------

NET ASSETS AT DECEMBER 31, 1995                                                            4,692,196

Income (loss) from liquidating activities                                                   (330,740)

Special allocation of carrying value to common stock held by
     employee benefit plans under settlement agreement (Note 2)                           (1,000,000)

Allocation of net loss and carrying value to
     common stock held by employee benefit plans                                              11,286
                                                                                        ------------

NET ASSETS AT DECEMBER 31, 1996                                                            3,372,742

Income from liquidating activities                                                           529,599

Allocation of net income and carrying value to common stock
     held by employee benefit plans                                                          (74,030)

NET ASSETS AT DECEMBER 31, 1997                                                            3,828,311

Income (loss) from liquidating activities                                                     66,629

Common stock dividend distribution                                                        (3,292,000)

Allocation of net income and carrying value to common stock
     previously held by employee benefit plans                                                (9,314)
                                                                                        ------------

NET ASSETS AT DECEMBER 31, 1998                                                              593,626

Income (loss) from liquidating activities (January 1, 1999 through March 31, 1999)           (33,004)

Allocation of net income and carrying value to common stock
     previously held by employee benefit plans                                                 4,613
                                                                                        ------------

NET ASSETS AT MARCH 31, 1999 (unaudited)                                                $    565,235
                                                                                        ============
</TABLE>

See Notes to Financial Statements.


                                       2
<PAGE>


                          1150 LIQUIDATING CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


Note 1.   Sale and Liquidation of the Company:

          Effective May 31, 1995, SBM Company (the "Company") sold substantially
          all of the business operations and assets of the Company to ARM
          Financial Group, Inc. (ARM) (the Transaction) for a purchase price of
          $34.5 million, net of $4.1 million of liabilities assumed, pursuant to
          an Amended and Restated Stock and Asset Purchase Agreement dated
          February 16, 1995 between the Company and ARM. As part of the
          Transaction, ARM acquired all of the outstanding stock of the
          Company's wholly owned subsidiaries (State Bond and Mortgage Life
          Insurance Company ("SBM Life"), SBM Certificate Company ("SBMC") and
          SBM Financial Services, Inc.) and certain assets of the Company,
          including the investment adviser function of six mutual funds, and
          assumed certain liabilities of the Company. The following summarizes
          the proceeds from and net assets sold of the Transaction:

               Proceeds from the sale                            $ 34,445,877

               Assets sold:
                 Investments                                      808,543,939
                 Receivable from reinsurer                         85,202,588
                 Deferred acquisition costs                        61,683,713
                 Other assets                                      14,863,970
                                                                 ------------
                                                                  970,294,210

               Liabilities assumed:
                 Future policy benefits                           861,067,924
                 Face amount certificate reserves                  56,439,745
                 Accounts payable and other liabilities            12,508,983
                                                                 ------------
                                                                  930,016,652
                                                                 ------------

               Net assets sold                                     40,277,558
               Less costs of the Transaction, including income
                 taxes of $408,000                                    710,927
                                                                 ------------

               Net loss on sale of Company operations            $(6,542,608)
                                                                 ============

          The Company intends to wind up and liquidate the Company as soon as
          practicable. The Company has adopted a Plan of Dissolution effective
          May 31, 1995. At closing, the Series A Preferred Stock was redeemed
          for $20.5 million (including $1.5 million of dividends in arrears) as
          a result of its senior rights over the common stock.

          The Company's shareholders approved the Transaction and the Plan of
          Dissolution (the "Plan") at their regular shareholder meeting on May
          18, 1995. The Company also changed its name to "1150 Liquidating
          Corporation" effective June 14, 1995.

          As a result, the Company adopted the liquidation basis of accounting
          effective January 1, 1995. Assets have been valued at estimated net
          realizable value and liabilities provide for all expenses to be
          incurred during the period of liquidation. The reserve for estimated
          costs during the period of liquidation includes what management
          anticipates are reasonable estimates of costs required to liquidate
          the Company's remaining assets and to defend known legal claims, as
          well as the estimated costs of directors and officers and legal, audit
          and other professional fees and expenses expected to be incurred
          during the period of liquidation. The net assets ultimately available
          for distribution to shareholders will depend almost entirely upon the
          remaining time involved in winding up the affairs of the Company, and
          any now unknown liabilities or additional litigation and the expenses
          and liabilities incurred in connection therewith.


                                       3
<PAGE>


                          1150 LIQUIDATING CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (Unaudited)


Note 1.  Sale and Liquidation of the Company (Continued):

          The statement of net assets in liquidation at March 31, 1999 includes
          accruals for general and administrative expenses anticipated by
          management with respect to resolving such known matters in a
          reasonably timely fashion, as expected at that date. Net assets
          ultimately available for distribution will be reduced by the amount of
          any other unknown liabilities as may arise in the future, and to any
          extent general and administrative expenses incurred exceed the
          estimates included in the statement of net assets in liquidation at
          March 31, 1999. In addition, the financial statements do not reflect
          any investment income that is anticipated to be earned subsequent to
          March 31, 1999.

          The financial statements included in this Form 10-Q have been prepared
          by the Company without audit. In the opinion of management, all
          adjustments necessary to present fairly the statement of net assets in
          liquidation and changes therein for all periods presented have been
          made.

          Certain information and footnote disclosures normally included in the
          financial statements prepared in accordance with generally accepted
          accounting principles have been condensed or omitted. It is suggested
          that these financial statements be read in conjunction with the
          financial statements and notes thereto included in the 1150
          Liquidating Corporation's Annual Report on Form 10-K for the year
          ended December 31, 1998.

          The preparation of financial statements in accordance 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 amount of revenues
          and expenses during the reporting period. For example, estimates and
          assumptions are used in determining the Reserve for Estimated Costs
          During the Period of Liquidation and Common Stock held by the Employee
          Benefit Plans or plan participants. While these estimates are based on
          the best judgment of management, actual results and revised estimates
          could differ from current estimates and are reflected in the period of
          change.


Note 2.   Common Stock Held by Employee Benefit Plans or Plan Participants:

          The Company's two employee benefit plans ("Plans") or plan
          participants owned 304,693 shares of Company common stock. The value
          of such shares has been classified as a separate line outside of net
          assets in liquidation on the Company's statement of net assets in
          liquidation as of March 31, 1999 and as of December 31, 1998 because
          of the Company's obligation to repurchase such shares, under certain
          circumstances, under a stock agreement ("Stock Agreement"), between
          the Company and the Plans' trustee dated September 30, 1993.

          On the December 31, 1998 and March 31, 1999 statement of net assets in
          liquidation, the liability to the Plans' participants has been shown
          as the estimated liquidation value of their shares of common stock
          under the settlement agreement discussed below.

          In January 1995, the trustee of the Plans notified the Company that it
          was tendering all shares held by the Plans to the Company for purchase
          by the Company under the Stock Agreement. Under the Stock Agreement,
          in certain circumstances, the Company has agreed to purchase common
          shares tendered to it by the Plans at a price equal to the higher of
          adjusted book value (as defined in the Stock Agreement) or fair market
          value. The Plans' trustee asserted in its tender that the correct
          basis under the Stock Agreement to determine the price of the shares
          for purposes of the Company's repurchase obligation is to


                                       4
<PAGE>


                          1150 LIQUIDATING CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (Unaudited)


Note 2.   Common Stock Held by Employee Benefit Plans or Plan Participants 
          (Continued):

          determine their adjusted book value at December 31, 1994 based on the
          books of the Company but using the amortized cost of the Company's
          investment portfolios, rather than their fair market value. The
          Company maintains that such price under the Stock Agreement must be
          based on the books of the Company which, after the effectiveness of
          the SFAS 115 on January 1, 1994, must use the market value, rather
          than the amortized cost, of the substantial portion of the Company's
          investment portfolios which must be classified as "available-for-sale"
          under applicable accounting principles. In the alternative, the
          Company maintains that the tender was invalid in the circumstances
          under which it was made and, even if valid, that the correct price
          under such circumstances is the pro-rata estimated liquidation value
          of all of the Company's common shares pursuant to the Plan of
          Dissolution, rather than any value based upon the books of the Company
          as prepared on the going concern historical cost basis.

          The Company declined to repurchase such shares at the price demanded
          by the Trustee for various reasons, including those stated above, and
          commenced a declaratory judgment action in Minnesota District Court in
          March 1995 to determine its repurchase obligation and the applicable
          price under the Stock Agreement ("Plan Litigation").

          On November 13, 1995, the Company, the Trustee, and the Schonlau Trust
          agreed upon a settlement of the litigation and executed a settlement
          agreement in principle. A draft of a final and more formal settlement
          agreement (the Settlement Agreement) was subsequently prepared and
          circulated. In general, the Settlement Agreement contemplates payment
          by the Company of $1.15 million to the Plans in addition to the pro
          rata amounts otherwise distributable in liquidation with respect to
          the 304,693 shares of Common Stock held by the Plans. This amount
          includes $150,000 in partial payment of attorneys' fees incurred by
          the Trustee. The Settlement Agreement also provides for the payment by
          the Company of up to $100,000 of the litigation costs incurred by the
          Schonlau Trust. The amounts payable as part of the settlement would be
          in addition to the pro rata amounts payable to Plan shareholders
          (determined without regard to the settlement amounts) and would be
          payable out of the amount otherwise available for pro rata
          distribution in liquidation to non-Plan shareholders.

          By April 1996, both the Trustee and the Schonlau Trust had indicated
          that they had no significant issues with respect to the economic terms
          of the Settlement Agreement. The Schonlau Trust did, however, indicate
          that it was unwilling to proceed to settlement unless a class
          consisting of all non-Plan shareholders was certified and unless it
          was named as representative of the class. The Company and the Trustee
          have agreed to these terms as part of the Settlement Agreement.

          During 1996, the Department of Labor (DOL) advised the Company of
          certain alleged violations of ERISA (of breach of fiduciary duty under
          Sections 404(a)(1)(A), (B), and (D) of ERISA and prohibited
          transactions based upon Section 406(b)(2) of ERISA) in connection with
          the Company's handling of the repurchase of shares owned by the Plans
          under the Put Agreement and the Internal Revenue Service (IRS) opened
          an audit alleging that the Company could be liable for certain excise
          taxes in connection with such matters. The Company objected to such
          allegations and, on February 27, 1997, received a letter from the DOL
          which advised it would take no further action in connection with the
          allegations if the litigation with the Plans is resolved pursuant to
          the Settlement Agreement and the Company subsequently was advised that
          the IRS would close its audit and not assess excise tax liabilities on
          the Company. These matters delayed implementation of the Settlement
          Agreement.


                                       5
<PAGE>


                          1150 LIQUIDATING CORPORATION

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (Unaudited)


Note 2.   Common Stock Previously Held by Employee Benefit Plans (Continued):

          In October 1996, the Company, the Schonlau Trust and the Trustee
          agreed to sign the Settlement Agreement and proceed with its
          implementation at such time as the allegations of the DOL and IRS were
          resolved in a manner satisfactory to all parties to the Plan
          litigation. In June 1997, these allegations of the DOL and IRS having
          been resolved, the Settlement Agreement was signed by all parties and
          was submitted to the court for approval. A hearing was held on August
          21, 1997 and Judge William R. Howard approved the settlement and
          entered the Order Approving Settlement. The Settlement became
          effective on November 21, 1997.

          Pursuant to the terms of the Settlement Agreement, on or about
          December 1, 1997, the Company made settlement payments totaling $1.15
          million to the Plan's Trustee and a settlement payment of $100,000 to
          the Schonlau Trust. Also, on or about December 1, 1997, the Company's
          initial liquidating distribution to the Trustee, which had been held
          in escrow pending resolution of the Plan litigation, was released to
          the Trustee.

          On February 16, 1998, the 304,693 shares of common stock held by the
          Employee Benefit Plans were distributed to plan participants.


Note 3.   Other Matters:

          The Company was notified that The Trust Under the Will of T.H.
          Schonlau ("Schonlau Trust"), its largest shareholder, had retained
          legal counsel for the purpose of investigating whether the Schonlau
          Trust had claims or rights against current or former officers,
          directors, employees, shareholders, representatives, agents, auditors,
          accountants, attorneys or anyone acting on its behalf (i) arising out
          of or relating to its ownership of SBM common shares and (ii) arising
          out of or relating to the management of SBM, or otherwise. The Trust
          had requested the Company to produce certain corporate records and
          documents in connection with its investigation.

          Any such shareholder action, even if successful in the long-term,
          would have the effect of delaying the liquidation and dissolution of
          the Company and of increasing its administrative and professional
          expenses in the short-term. No provision has been made to support any
          actual litigation by the Schonlau Trust, any possible liability of the
          Company, claims for indemnity by present or former officers or
          directors, or related litigation which may result, because the
          Schonlau Trust has not decided at this time to bring any such action.

          Company counsel has now been advised by counsel to the Schonlau Trust
          that its investigation of potential claims has been terminated and
          that the Trustees have no present intention of "commencing litigation
          on behalf of the Schonlau Trust against any person or entity arising
          from or related to the conduct and events that resulted in the sale of
          SBM's assets in 1995." Representatives of other significant
          shareholders have made similar statements to management.


                                       6
<PAGE>


                          1150 LIQUIDATING CORPORATION

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


RESULTS OF OPERATIONS


                                       7
<PAGE>


                           PART II. OTHER INFORMATION


Item 4.   Submission of Matters to a Vote of Securities Holders

          None


Item 6.   Exhibits and Reports on Form 8-K

          None


                                       8
<PAGE>


                                    SIGNATURE


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.


                                      1150 LIQUIDATING CORPORATION



Date  May 14, 1999                    By: /s/ Charles A. Geer
    -------------------------             --------------------------------------
                                          Charles A. Geer

                                      Its: President and Chief Financial Officer


                                       9