<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
----------------
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
COMMISSION FILE NUMBER: 0-29185
SAVE THE WORLD AIR INC
(Exact Name of Small Business Issuer as Specified in Its Charter)
----------------
Nevada 52-2088326
------ ----------
(State of incorporation) (I.R.S. Employer Identification No.)
................................................................................
1285 Avenue of the Americas, 35th Floor
New York, NY 10019-6028
(Address of principal executive offices)
Phone 212 - 554 4197
(Issuer's telephone number)
................................................................................
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE.
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
COMMON STOCK, PAR VALUE $.01 PER SHARE
----------------
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
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS
State the numbers of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
Transitional Small Business Disclosure Format (Check one):
Yes No
--- ---
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<PAGE>
PART I
FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
- ------- ---------------------------------
SAVE THE WORLD AIR INC
STATEMENT OF OPERATIONS
FOR THE PERIOD ENDED MARCH 31, 2000
Mar-31 Dec-31
2000 1999
---- ----
INCOME
Sale of Licences for Distributorships - 125,000
Consultancy Fees 9,980 -
-------------- --------------
9,980 125,000
============== ==============
GENERAL AND ADMINISTRATIVE EXPENSES
Bank Charges 144
Consulting Fees 3,867
Filing Fees 965
Mineral Claims Written Off 1,955
Printing 1,053
Professional Fees 420 62,500
Radio and PR Fees 6,000
Secretarial Fees 866 11,164
Transfer Agents Fees 785
Travel Costs 786 46,982
-------------- --------------
TOTAL COSTS 9,822 127,665
-------------- --------------
PROFIT (LOSS) FOR PERIOD $ 158 -$ 2,665
============== ==============
Loss per Common Share
Primary $ 0 $ 0
The accompanying notes are an integral part of these financial accounts
1
<PAGE>
<TABLE>
SAVE THE WORLD AIR, INC.
BALANCE SHEET
AS AT MARCH 31 2000
<CAPTION>
Mar-31 Dec-31
2000 1999
---- ----
ASSETS
<S> <C> <C>
CURRENT ASSETS
Cash at Bank 873 595
-------------- --------------
873 595
FIXED ASSETS
Marketing and Manufacturing Rights
Zero Pollution Fuel Device 5,000 5,000
-------------- --------------
TOTAL ASSETS $ 5,873 $ 5,595
============== ==============
LIABILITIES AND STOCKHOLDERS EQUITY
CURRENT LIABILITIES
-
STOCKHOLDERS EQUITY
Common Stock 200,000,000 shares authorised
at $.001 par value. 15,417,125 issued
and outstanding 15,417 15,297
Capital in excess of par 14,270 14,270
Accumulated Deficit - 23,814 - 23,972
-------------- --------------
TOTAL LIABILITY
AND STOCKHOLDERS EQUITY $ 5,873 $ 5,595
============== ==============
</TABLE>
Approved by the Board
The accompanying notes are an integral part of these financial accounts
2
<PAGE>
<TABLE>
SAVE THE WORLD AIR, INC
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
DATE OF INCEPTION TO MARCH 31, 2000
<CAPTION>
Common stock Capital in Accumulated
in Shares Excess of Deficit
Par Value
<S> <C> <C> <C>
Balance February 18, 1998
(Date of Inception)
Issuance of Common Stock
Cash at $0.015 March 3 1998 4,000,000 2,000 -
Issuance of Common Stock
Cash at $0.003 March 5 1998 6,000,000 12,000
Issuance of Common Stock
Cash at $0.01 per Share 30,000 270
Issuance of Common Stock for
services rendered at $0.001 267,125
Issuance of Common Stock for
exchange of marketing rights 5,000,000
Issuance of Common Stock for
services rendered at $0.001 120,000
Net Accumulated Losses to
31-Mar-00 - 23,814
------------------------------------------------------------------------------
BALANCE AS AT 31 MARCH 2000 15,417,125 $ 14,270 -$ 23,814
==============================================================================
</TABLE>
The accompanying notes are an integral part of these financial accounts
3
<PAGE>
<TABLE>
SAVE THE WORLD AIR, INC.
STATEMENT OF CASHFLOWS
JANUARY 1, 2000 TO MARCH 31, 2000
<CAPTION>
Mar-31 Dec-31
2000 1999
---- ----
<S> <C> <C>
CASHFLOWS FROM OPERATING ACTIVITIES
Cashflow arising from trading activities -9822 -2665
Adjustments to reconcile net loss to net cash
provided by operating activities:
* Write off of Mineral Claims 1955
* Consultancy Fees paid in Shares 120 267
-------------- --------------
NET CASH PROVIDED
BY OPERATIONS -9702 -443
CASHFLOWS FROM INVESTING ACTIVITIES
CASHFLOWS FROM FINANCING ACTIVITIES
Loan J & L Muller 9980
NET INCREASE IN CASH 278 -443
CASH AT BEGINNING OF PERIOD 595 38
CASH AT END OF PERIOD 873 -405
</TABLE>
The accompanying notes are an integral part of these financial accounts
4
<PAGE>
SAVE THE WORLD AIR, INC.
NOTES TO THE FINANCIAL STATEMENTS
March 31 2000
1. DESCRIPTION OF THE BUSINESS
The Company was incorporated under the Corporate Charter issued by the
Secretary of State of Nevada in the United States on February 18, 1998.
The Company is deemed to be an investment company. The company holds
the rights to manufacture and market a device that decreases the carbon
dioxide output on internal combustion engines.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements have been prepared in accordance with
accounting principles generally accepted and include the following
accounting principles.
(a) BASIS OF PRESENTATION - GOING CONCERN
The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realisation of assets and
satisfaction of liabilities in the normal course of business. The
company has been engaged in the identification and development of its
zero pollution device. The Company's ability to meet its obligations
and successfully develop its project and, ultimately, to attain
profitable operations is dependent upon further developing and
marketing the device known as Zero Pollution and obtaining additional
financing from either third parties or its present shareholders.
(b) ACCOUNTING METHODS
The Company recognises income and expenses based on the accrual method
of accounting.
5
<PAGE>
SAVE THE WORLD AIR, INC.
NOTES TO THE FINANCIAL STATEMENTS
March 31 2000
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
(c) DIVIDEND POLICY
The Company has not yet adopted any policy regarding the payment of
dividends.
(d) CASH AND CASH EQUIVALENTS
The Company considers all highly liquid instruments purchased with a
maturity, at the time of purchase, of less than three months, to be
cash equivalents.
(e) LOSS PER SHARE
Primary loss per share amount is computed based on the weighted average
number of shares actually outstanding during the period reported on.
Fully diluted loss per share is computed under the same basis since
there are not warrants or share subscriptions outstanding.
(f) INCOME TAXES
For the period ended March 31 2000 (the date of these financial
statements), the Company had a net operating loss of $9,822. The tax
6
<PAGE>
SAVE THE WORLD AIR, INC.
NOTES TO THE FINANCIAL STATEMENTS
March 31 2000
2. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
(f) INCOME TAXES - CONTINUED
benefits from the loss carried forward is offset by a valuation reserve
because the future tax benefit is indeterminable.
The net operating loss carryover will expire beginning in the year 2000
through 2013.
(g) FOREIGN CURRENCY TRANSLATION
The translations of the Company completed in foreign dollars have been
translated to US dollars. Assets and liabilities are translated at the
year end exchange rates and the income and expenses at the average
rates of exchange prevailing during the period reported on. Any gains
or loss resulting from the translations would be shown in the Statement
of Operations.
(h) FINANCIAL INSTRUMENTS
For cash, deposit and accounts payable and accrued liabilities, the
carrying amount of these financial instruments approximates their fair
value due to their short-term maturity capacity of prompt liquidation
or settlement. The account payable does not bear any interest thereon.
3. RELATED PARTY TRANSACTIONS
On March 30, 2000, the company entered into an option agreement with Mr
Jeff Muller and Mrs Lyn Muller. The company entered into an employment
agreement with Mr and Mrs Muller whereby they surrendered any claims to
reimbursement for employment costs to that date in exchange for 5
million options to share capital each. The option amount was agreed to
be at par of $0.001 per share.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
CHAIRMAN'S REPORT 31ST MARCH 2000
We would like to thank you for supporting Save The World Air Inc. (ZERO) and
would like to take this opportunity to keep you updated with the latest from
management and look forward to your input.
Over the past year Save The World Air Inc. has developed a solid base of support
throughout the international business community due to both gaining exposure in
the media worldwide and the ongoing hard work and commitment of both management
and our very professional team which now includes top rate USA investor
relations people and highly ranked business consultants.
Famous names such as Steven Seagal (Actor/Environmentalist), Sir Jack Brabham (3
x Formula One Champion), and Barry Sheene (3 x World Champion Motorcyclist) and
several other high profile business people including Mr. Robert Sylk of the Sylk
Corporation have joined Save The World Air Inc. as both shareholders and
supporters.
As you may know our share price dropped to a low of US$0.10 cents last year and
has since begun a steady climb back up to as high as US$5.50 despite the recent
stock market crash. Our stock has been doing extremely well, holding steady
through the turmoil on both the NASDAQ and the Dow Jones.
Save The World Air Inc. recently held in Brisbane, Australia, the latest of a
series of worldwide public tests. Over 150 people turned up for the entire test
process and were amazed to see the device successfully achieving Zero results as
predicted. Jeffrey A. Muller, Chairman of STWA arrived in Australia from Los
Angeles in time to oversee the test, which was attended by government
representatives including the Australian Greenhouse Office, E.P.A. and the
Brisbane City Council as well as independent engineers.
CNBC and CNN will soon be commencing an intensive advertising campaign for Save
The World Air Inc. and already the response management has seen is great. The
main focus of this advertising campaign is to spread public awareness that the
ZERO Emission control device does exist and also has the added advantage of
being able to reduce fuel consumption by up to 63 percent. We are also pushing
for the sale of licensing agreements worldwide to fit the Zero Emission Fuel
Saver on any petrol driven vehicle. The Zero Emission Fuel Saver has recently
been featured on the UPN Channel 13 News in Los Angeles. The report can be
viewed on the Save the World Website.
Mr. Muller has been doing live business investment radio program interviews in
the USA and the response has been very positive from both the talkback audience
and the radio show host, Jim DiPelisi.
Save the World Air Inc. was well represented at the recent Earth Day weekend
held in Los Angeles and our people manning our desk have reported very positive
feedback. In San Diego on 18th May a seminar on air pollution from motor
vehicles is being held and is being well attended by many Government officials
and it is our intention to attend.. We will then be holding another
demonstration in Florida on 7th June for stockbrokers and investors and this is
almost fully subscribed at this time, we are then planning to go to New York to
capitalise on the publicity which will be generated by these two events.
A major USA car manufacturer has approached us and seems very interested in our
product and management is hoping to have a meeting with them in the near future.
The Save The World Air Website has been undergoing changes, a Macromedia
Shockwave Flash interface will be implemented to allow a better multimedia
experience. It is recommended to install 4.0 Internet Browsers such as Netscape
4.72 and Internet Explorer 5.02, this will allow for full compatibility. The
Video Archive section has increased and the full length Pro Hart Discovery
Channel clip has been added.
We have been posting regular announcements on the company and this is also
lifting our profile, especially within the USA.
8
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
SAVE THE WORLD AIR, INC.
(REGISTRANT)
Signature Title Date
/s/ Jeffrey A. Muller Chairman and President May 8, 2000
- ---------------------------
(Jeffrey A. Muller)
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<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 873
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 873
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 5,873
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 15,417
<OTHER-SE> (9,544)
<TOTAL-LIABILITY-AND-EQUITY> 5,873
<SALES> 0
<TOTAL-REVENUES> 9,980
<CGS> 0
<TOTAL-COSTS> 9,822
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 158
<INCOME-TAX> 0
<INCOME-CONTINUING> 158
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 158
<EPS-BASIC> 0
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</TABLE>
