<PAGE> 1
U.S. 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, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____________ to ______________.
Commission File Number 0-17772
CORSAIRE, INC.
---------------------------------------
(Exact name of small business issuer as
specified in its charter)
DELAWARE 56-0672633
--------------------------------- -------------------
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
62 Indian Trace, Suite 286
Weston, FL 33326
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(Address of principal executive offices)
CORSAIRE SNOWBOARD, INC.
------------------------
(Former Name)
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 No X*
-------- ---------
Number of shares outstanding of each of the issuer's classes of common
equity, as of March 31, 1998: 3,391,859 shares of common stock, $0.001 par
value per share.
*See Financial Statements Footnote 2
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CORSAIRE, INC.
(FORMERLY CORSAIRE SNOWBOARD, INC.)
FORM 10-QSB
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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Part I
<S> <C> <C>
Item 1. Financial Statements......................................................................1
Balance Sheets (Unaudited) As of March 31, 1998 and December 31, 1997..............................2
Statement of Operations (Unaudited) for the Three Month Periods ended
March 31, 1998 and March 31, 1997.........................................................3
Statement of Changes in Stockholders' Equity (Unaudited) for the Three
Month Periods ended March 31, 1998 and March 31, 1997.....................................4
Statement of Cash Flows (Unaudited) for the Three Month Periods ended
March 31, 1998 and March 31, 1997.........................................................5
Notes to Financial Statements (Unaudited) for the Three Month Periods ended
March 31, 1998 and March 31, 1997.........................................................6
Item 2: Management's Discussion and Analysis or Plan of Operation.................................8
Part II
Item 1. Legal Proceedings.........................................................................9
Item 2. Changes in Securities.....................................................................9
Item 3. Defaults Upon Senior Securities...........................................................9
Item 4. Submission of Matters to Vote of Security Holders.........................................9
Item 5. Other Information.........................................................................9
Item 6. Exhibits and Reports on Form 8-K..........................................................9
Signatures .........................................................................................10
</TABLE>
-i-
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PART I
ITEM 1. FINANCIAL STATEMENTS
In the opinion of management, the accompanying balance sheets and
related interim statements of operations and cash flows (unaudited) include all
adjustments (consisting only of normal recurring items) necessary for their
fair presentation in conformity with generally accepted accounting principles.
Preparing financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets, liabilities, revenues,
and expenses. Actual results may differ from these estimates. Interim results
are not necessarily indicative of results for the full year.
The information included in this Form 10-QSB should be read in
conjunction with Management's Discussion and Analysis and financial statements
and notes thereto included in the Company's Form 10-KSB for December 31, 1997.
1
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CORSAIRE, INC.
(formerly Corsaire Snowboard, Inc.)
BALANCE SHEETS (UNAUDITED)
AS OF MARCH 31, 1998 AND DECEMBER 31, 1997
<TABLE>
<CAPTION>
March 31, 1998 December 31, 1997
----------------- ------------------
<S> <C> <C>
ASSETS
Current Assets
Cash and cash equivalents $ 0 $ 20
----------- ------------
Total Current Assets 0 20
----------- ------------
Total Assets 0 20
=========== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable and accrued liabilities 0 0
----------- ------------
Total Current Liabilities 0 0
----------- ------------
Total Liabilities 0 0
=========== ============
Stockholders' Equity
Common Stock, $0.001 par value, authorized
25,000,000 shares: 3,391,859 and 3,041,859 issued and
outstanding in March 31, 1998 and December 31, 1997,
respectively 3,392 3,042
Paid-in capital 3,273,273 3,076,748
Accumulated deficit (3,276,665) (3,079,770)
----------- ------------
Total Stockholders' Equity 0 20
=========== ============
Total Liabilities and Stockholders' Equity $ 0 $ 20
=========== ============
</TABLE>
See accompanying notes to financial statements.
2
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CORSAIRE, INC.
(formerly Corsaire Snowboard, Inc.)
STATEMENT OF OPERATIONS (UNAUDITED) FOR THE THREE MONTH PERIODS ENDED
MARCH 31, 1998 AND MARCH 31, 1997
<TABLE>
<CAPTION>
March 31, 1998 March 31, 1997
-------------- --------------
<S> <C> <C>
Revenues $ 0 $ 0
========== ==========
Expenses
Officers' compensation 0 51,309
Consulting services 0 0
Legal fees and expenses 196,875 0
Other general and administrative expenses 20 15
---------- ----------
Total expenses 196,895 51,324
---------- ----------
Loss before provision for taxes (196,895) (51,324)
Provision for income taxes 0 0
---------- ----------
Net loss (196,895) (51,324)
========== ==========
Net loss per share $ (0.06) $ (0.02)
========== ==========
Weighted average shares outstanding 3,216,859 3,041,859
========== ==========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE> 6
CORSAIRE, INC.
(formerly Corsaire Snowboard, Inc.)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) FOR THE THREE MONTH
PERIODS ENDED MARCH 31, 1998 AND MARCH 31, 1997
<TABLE>
<CAPTION>
COMMON STOCK
-----------------------------------------------
Additional Total
Number of Par Paid-in Accumulated Subscription Stockholders'
Shares Value Capital Deficit Receivable Equity
--------- ----- ----------- ----------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Balance,
March 31, 1997 3,041,859 $3,042 $3,076,748 $ (3,028,446) $(51,309) $ 35
--------- ------ ---------- ------------- -------- ------
Balance,
March 31, 1998 3,391,859 $3,392 $3,273,273 $ (3,276,665) $ 0
--------- ------ ---------- ------------- -------- ------
</TABLE>
See accompanying notes to financial statements.
4
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CORSAIRE, INC.
(formerly Corsaire Snowboard, Inc.)
STATEMENT OF CASH FLOWS (UNAUDITED) FOR THE THREE MONTH PERIODS
ENDED MARCH 31, 1998 AND MARCH 31, 1997
<TABLE>
<CAPTION>
March 31, 1998 March 31, 1997
-------------- --------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(196,895) $(51,324)
Adjustments to reconcile net loss to net cash
used for operating activities
Issuance of common stock for consulting and
legal services and satisfaction of
amounts due officer 196,875 51,309
--------- --------
Cash used from operations (20) (15)
--------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Contributions from shareholder 0 0
--------- --------
Cash used from financial activities 0 0
Decrease in cash (20) (15)
CASH AND CASH EQUIVALENTS, beginning of period 20 35
--------- --------
CASH AND CASH EQUIVALENTS, end of period $ 0 $ 20
========= ========
</TABLE>
See accompanying notes to financial statements.
5
<PAGE> 8
CORSAIRE, INC.
(FORMERLY KNOWN AS CORSAIRE SNOWBOARD, INC.)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) FOR THE THREE MONTH PERIODS ENDED
MARCH 31, 1998 AND MARCH 31, 1997
(1) Summary of Significant Accounting Principles
Corsaire, Inc. (formerly known as Corsaire Snowboard, Inc.) (the
"Company") was incorporated in Delaware in 1987 under the name Acunet
Corporation. It became inactive in 1990, and there are no corporate records or
minutes available to document the activities of the corporation until January
1994.
In January 1994, the Company reestablished good standing with the
State of Delaware, and brought current the filings required by the Securities
and Exchange Commission (the "SEC").
In March 1995, the Company changed its name from Acunet Corporation to
Corsaire Snowboard, Inc., with offices in Canada. The Company became inactive
on March 1, 1997 and remained so until July 15, 1997 when it was revived in
Delaware under the name Corsaire, Inc.
The Company's principal business purpose has been the identification
and evaluation of prospective merger and acquisition opportunities.
The Company is publicly traded and its shares are quoted in the
over-the-counter (bulletin board) market.
(a) CASH AND CASH EQUIVALENTS.
Cash equivalents consist of short-term, highly liquid investments that
are readily convertible into cash and were purchased with maturities of less
than three months.
(b) CURRENCY TRANSLATION.
The accompanying financial statements are expressed in U.S. dollars.
The Company maintains an office in Fort Lauderdale, Florida and no longer has
operations in Canada. Any expenditures and obligations in Canadian currency
were translated at the exchange rate prevailing when they were incurred. Assets
and liabilities at December 31, 1996 and 1997, where applicable, have been
translated at the year-end exchange rates. There were no significant exchange
or translation gains or losses during these years.
(c) VALUATION OF SHARES ISSUED FOR SERVICES.
The Company accounts for stock-based compensation at fair market
value, in accordance with SFAS No. 123, "Accounting for Stock-Based
Compensation" (SFAS 123). SFAS 123 establishes a fair value based method of
accounting for stock-based compensation.
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(d) BASIC AND DILUTED LOSS PER SHARE.
Net loss per share is determined by dividing net loss by the weighted
average number of common shares outstanding during the year.
(e) USE OF ESTIMATES.
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 the
disclosure of contingent assets and liabilities at the date of the financial
statements and that affect revenues and expenses during the period reported.
Estimates are adjusted to reflect actual experience when necessary. Significant
estimates are used to account for fair market value of the Company's common
stock exchanged for services of consultants and professionals.
(f) NEW ACCOUNTING STANDARDS.
Effective January 1, 1998, the Company adopted Statement of Financial
Accounting Standard No. 131, "Disclosures about Segments of an Enterprise and
Related Information" (SFAS 131). SFAS 131 establishes standards for defining
operating segments and for reporting information about operating segments in
financial statements. It also establishes standards for related disclosures
about products, geographic areas, and major customers. The Company's reportable
operating segments did not change as a result of adopting SFAS 131.
(2) STATUS OF ENTITY
During the course of preparing the delinquent Forms 10-QSB and Forms
10-KSB for the period from December 31, 1996 through December 31, 1998, and the
10-QSB for the quarter ended March 31, 1999, present management uncovered the
following:
(1) that the State of Delaware requires that the revival and
renewal of a Certificate of Incorporation of an administratively dissolved
corporation be effectuated through the execution and filing of a certificate on
the authority of those who were the directors of the corporation at the time of
its expiration;
(2) that Mr. Parshall apparently did not file such a
certificate, but instead filed an original Certificate of Incorporation under
the same name as the dormant corporation which was to have been revived (i.e.
Acunet) and then continued to file reports with the SEC under the SEC file
number of the non-revived company;
(3) that Mr. Parshall had, on other occasions, incorporated
new companies with the same name as dissolved (or dormant companies) that had
common stock registered under Section 12(g) of the Exchange Act, continued to
file reports under the non-revived companies' file number, and in the process,
issued a significant amount of shares in these companies to himself; and
(4) that in September 1996, Mr. Parshall had been enjoined by
the United States District Court of Utah (SEC v. Axiom Securities Solutions,
Inc. and Paul L. Parshall, Civil Action No. 2-96CV-08245J) from violating the
anti-fraud provisions of the federal securities laws and was barred from serving
as an officer or director of a company filing reports with the SEC. In addition,
in September 1996, he was the subject of administrative proceedings before the
SEC barring him from participating in penny stock offerings and association with
a broker/dealer, investment company, investment advisor, transfer agent or
municipal securities dealer.
The Company, validly existing as a corporation under Delaware law,
while continuing to report under SEC File No. 0-17772, has determined to file a
Form 10-SB covering its common stock in order to properly register its common
stock under the Exchange Act and correct the existing deficiency.
7
<PAGE> 10
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Company is an inactive company and had limited operations
during the quarter ended March 31, 1998. The Company had no revenue during the
three month period ended March 31, 1998 but did incur substantial expenses for
legal services. Similarly, in the same period in 1997, the Company had no
revenue and incurred expenses relating to compensation of its officer.
Substantially all of the expense during the period in 1998 and 1997 were paid
through the issuance of stock of the Company.
8
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PART II
ITEM 1. LEGAL PROCEEDINGS:
None.
ITEM 2. CHANGES IN SECURITIES:
The Company issued 350,000 shares of common stock to a third
party in exchange for legal services rendered. The shares were
issued pursuant to an exemption from registration provided by
Section 4(2) of the Securities Act of 1933, as amended. The
Company did not pay any fees or commissions in connection with
their issuance.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES:
None.
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS:
None.
ITEM 5. OTHER INFORMATION:
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K:
a. Exhibits:
Exhibit No. Description
----------- -----------
27 Financial Data Schedule
b. Reports on Form 8-K:
None.
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SIGNATURES
Pursuant to the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.
CORSAIRE, INC.
Dated: May 24, 1999
By: /s/ Robert I. Chalnick
------------------------------------------
Robert I. Chalnick
Vice President and Chief Executive Officer
10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 3,392
<OTHER-SE> 3,273,273
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 196,895
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (196,895)
<INCOME-TAX> 0
<INCOME-CONTINUING> (196,895)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (196,895)
<EPS-BASIC> (.06)
<EPS-DILUTED> (.06)
</TABLE>
