<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1996
[ ] 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: 0-24690
----------
CLARION HOUSE, INC.
----------------------------------------------
(Name of small business issuer in its charter)
Nevada 91-1407411
- ------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1901 North Roselle Road, Suite 1030, Schaumburg, Illinois 60195
---------------------------------------------------------------
(Address of principal executive offices)
Issuer's telephone number: (847) 490-5977
-------------------
Securities registered under Section 12(b) of the Exchange Act: None
-------
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $.01 Par Value
----------------------------
(Title of Class)
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
Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB.[ X ]
State issuer's revenues for its most recent fiscal year. $0
State the aggregate market value of the voting and non-voting common
equity held by non-affiliates computed by reference to the price at which the
common equity was sold, or the average bid and asked price of such common
equity, as of a specified date within the past 60 days. $1,845,924 (based upon
the average bid and asked price as of September 24, 1998).
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date. As of August 27, 1998,
9,933,657 shares of common stock were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE: None
Transitional Small Business Disclosure Format (check one):
Yes _____ No X
<PAGE>
PART I
ITEM 1. DESCRIPTION OF BUSINESS
The Company was originally incorporated in Nevada as KAR VENTURES on
March 17, 1988. The Company changed its name to Clarion House, Inc. (a Nevada
corporation) on January 28, 1991 when it acquired, in a reverse acquisition, the
publishing business conducted by Clarion House, Inc. (a Georgia corporation).
The Company's publishing activities, which never progressed beyond the
development stage, consisted of two books distributed primarily through direct
sales to the public through mailings and advertising. The Company's publishing
business ceased active operations by 1992 due to lack of financing and was
terminated in March of 1993 when the Company transferred to its former principal
shareholder, Wallis Wood, in redemption of 148,000 shares of common stock, all
of the issued and outstanding capital stock of its wholly-owned subsidiary,
Clarion House, Inc., a Georgia corporation ("Clarion-Georgia"). The value of the
stock of Clarion-Georgia was deemed of negligible value due to cessation of
operations. Mr. Wood is no longer an affiliate of the Company, but remains a
less than 1% shareholder.
On September 20, 1993, the Company acquired Insecta Sales, Inc., a
Florida corporation ("Insecta") pursuant to an Agreement and Plan of
Reorganization ("Plan") between the Company, Insecta and Gaelic Investments,
Inc., a Bahamian corporation ("Gaelic"). Under the Plan (i) the Company acquired
100% of the issued and outstanding capital stock of Insecta; (ii) the Company
issued Gaelic, the sole shareholder of Insecta, 1,040,000 shares of the
Company's common stock; and (iii) Gaelic granted Insecta an exclusive worldwide
license to use the insecticidal coating technology and the Insecta trademark
owned by Gaelic.
Following consummation of the Plan, the Company, through Sales, engaged
in the distribution of Insecta(R) products to the consumer, industrial,
commercial and agricultural markets primarily in the United States. The Company
never achieved sufficient revenues to support its operations. As a result, the
Company lost its license rights to the insecticidal coating technology and the
Insecta (R) trademark in December 1995 due to the non-payment of royalties.
As of December 31, 1995, the Company had no active operations.
On April 22, 1996, the Company entered into an Agreement and Plan of
Reorganization and Corporate Separation (the "Reorganization") with exchanging
stockholders of the Company. Pursuant to the Reorganization which was not
actually consummated until December 1997, the exchanging stockholders exchanged
all of their Company common stock (an aggregate of 800,000 shares) for all of
the issued and outstanding common stock of Insecta Sales & Research, Inc., a
Delaware corporation and a wholly-owned subsidiary of the Company. The Company
had no active operations during 1996.
1
<PAGE>
ITEM 2. DESCRIPTION OF PROPERTY
The Company had no real property interests during fiscal 1996.
ITEM 3. LEGAL PROCEEDINGS
Inapplicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Inapplicable.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
(a) Market Information.
-------------------
The Company's common stock, $.01 par value per share (the "Common
Stock") is traded in the over-the-counter market, however, there is no
established public trading market and reliable high and low bid quotations are
not available. The nominal volume of the trading and price do not reflect any
significant market. All references to Common Stock in their report reflect the
April 1996 one-for-five reverse split.
(b) Holders.
--------
As of August 27, 1998, there were approximately 118 record holders of
the Common Stock. The Company believes that a significant number of its
beneficial owners are holding their Common Stock in "street name."
(c) Dividends.
----------
The Company has never declared or paid any cash dividends on its Common
Stock and does not intend to declare or pay any cash dividend in the foreseeable
future.
2
<PAGE>
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Company had no active operations during fiscal 1996. Since January
1, 1996, the Company has incurred accounting expenses associated with
preparation of financial statements, legal expenses in connection with proposed
reorganizations with operating companies, transfer agent fees and other general
and administrative costs of maintaining the corporate entity for eventual sale.
The expenses incurred in the fiscal year ended December 31, 1996 for such
activities was approximately $62,711.
The Company's cash requirements during fiscal 1996 were funded by
advances from a stockholder of the Company. The stockholder advanced funds
pursuant to five demand promissory notes issued as follows: 5/1/96 in the
original principal amount of $5,000; 5/21/96 in the original principal amount of
$1,000; 6/6/96 in the original principal amount of $1,000; 7/5/96 in the
original principal amount of $5,000 and 8/7/96 in the original principal amount
of $5,000.
The Company had no revenues for the year ended December 31, 1996 and
had a net loss of $4,865 in fiscal 1996.
3
<PAGE>
ITEM 7. FINANCIAL STATEMENTS
CLARION HOUSE, INC. AND SUBSIDIARY
- CONTENTS -
PAGE NUMBER
-----------
Accountants' Compilation Report (Unaudited) 5
Financial Statements:
Consolidated Balance Sheet 6
Consolidated Statement of Changes in
Stockholders' Deficit 7
Consolidated Statement of Operations and Accumulated
Deficit 8
Consolidated Statement of Cash Flows 9
Notes to Consolidated Financial Statements 10-12
4
<PAGE>
To the Board of Directors
Clarion House, Inc. and Subsidiary
Schaumburg, Illinois
We have compiled the accompanying balance sheets of CLARION HOUSE, INC. AND
SUBSIDIARY as of December 31, 1996 and 1995, and the related statements of
changes in stockholders' deficit, operations and accumulated deficit and cash
flows for the years then ended, in accordance with Statements on Standards for
Accounting and Review Services issued by the American Institute of Certified
Public Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. We have not audited or
reviewed the accompanying financial statements and, accordingly, do not express
an opinion or any other form of assurance on them.
PERRIN, FORDREE & COMPANY, P.C.
/s/ Perrin, Fordee & Company, P.C.
April 22, 1998
5
<PAGE>
<TABLE>
CLARION HOUSE, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET
(SEE ACCOUNTANTS' COMPILATION REPORT)
(UNAUDITED)
<CAPTION>
DECEMBER 31,
------------
1996 1995
----------- -----------
ASSETS
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 19 $ 1,119
Accounts receivable - 7,087
Inventory - 33,347
Prepaid expenses - 15,357
----------- -----------
Total current assets 19 56,910
EQUIPMENT, net of accumulated depreciation 838 9,283
OTHER ASSETS -
Organization costs, net of accumulated
amortization of $2,907 483 483
----------- -----------
TOTAL ASSETS $ 1,340 $ 66,676
=========== ===========
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 57,978 $ 141,921
Notes payable 72,715 55,715
Accrued expenses 6,472 -
----------- -----------
Total current liabilities 137,165 197,636
STOCKHOLDERS' DEFICIT:
Common stock - $.01 par value
Authorized - 50,000,000 and
10,000,000 at December 31, 1996
and 1995
Issued and outstanding - 1,532,900 and
7,614,384 at December 31, 1996 and
1995 15,329 76,244
Paid-in capital 1,043,267 982,352
Accumulated deficit (1,194,421) (1,189,556)
----------- -----------
(135,825) (130,960)
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 1,340 $ 66,676
=========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
CLARION HOUSE, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT
(SEE ACCOUNTANTS' COMPILATION REPORT)
(UNAUDITED)
<TABLE>
<CAPTION>
COMMON PAID-IN ACCUMULATED
STOCK CAPITAL DEFICIT TOTAL
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
BALANCE - January 1, 1995 $ 76,244 $ 982,352 $ (725,494) $ 333,102
NET LOSS - - (464,062) (464,062)
------------ ------------ ----------- ------------
BALANCE - December 31, 1995 76,244 982,352 (1,189,556) (130,960)
NET LOSS - - (4,865) (4,865)
RECAPITALIZATION (60,915) 60,915 - -
------------ ------------ ----------- ------------
$ 15,329 $ 1,043,267 $(1,194,421) $ (135,825)
============ ============ =========== ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
7
<PAGE>
CLARION HOUSE, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
(SEE ACCOUNTANTS' COMPILATION REPORT)
(UNAUDITED)
YEAR ENDED DECEMBER 31,
------------------------
1 9 9 6 1 9 9 5
------- -------
SALES $ - $ 121,190
COST OF GOODS SOLD 33,347 117,797
------------ ------------
GROSS PROFIT (33,347) 3,393
ADMINISTRATIVE EXPENSES 62,711 468,128
------------ ------------
OPERATING INCOME (96,058) (464,735)
OTHER INCOME (EXPENSE):
Interest income - 673
Forgiveness of debt 91,193 -
------------ ------------
91,193 673
------------ ------------
NET LOSS (4,865) (464,062)
ACCUMULATED DEFICIT:
Balance - beginning of year (1,189,556) (725,494)
------------ ------------
Balance - end of year $(1,194,421) $(1,189,556)
============ ============
The accompanying notes are an integral part of the financial statements.
8
<PAGE>
<TABLE>
CLARION HOUSE, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(SEE ACCOUNTANTS' COMPILATION REPORT)
(UNAUDITED)
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------
1996 1995
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers $ 7,087 $ 119,957
Cash paid to suppliers and employees (116,380) (396,955)
Miscellaneous income received 91,193 -
Interest income received - 673
------------ ------------
Net cash to operating activities (18,100) (276,325)
CASH FLOWS FROM FINANCING ACTIVITIES -
Proceeds from long term debt 17,000 55,715
------------ ------------
NET DECREASE IN CASH AND
CASH EQUIVALENTS (1,100) (220,610)
CASH AND CASH EQUIVALENTS:
Balance - January 1 1,119 221,729
------------ ------------
Balance - December 31 $ 19 $ 1,119
============ ============
RECONCILIATION OF NET LOSS TO NET CASH TO OPERATING ACTIVITIES
NET LOSS $ (4,865) $ (464,062)
Adjustments -
Depreciation 8,445 -
Changes in assets and liabilities:
Decrease (Increase) in accounts receivable 7,087 (1,233)
Decrease in inventory 33,347 62,621
Decrease in prepaid expenses 15,357 21,501
Increase (decrease) in accounts payable and
accrued expenses (77,471) 104,848
------------ ------------
NET CASH TO OPERATING ACTIVITIES $ (18,100) $ (276,325)
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
9
<PAGE>
CLARION HOUSE, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1996
(SEE ACCOUNTANTS' COMPILATION REPORT)
(UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
This summary of significant accounting policies of Clarion House,
Inc. and Subsidiary is presented to assist in understanding the
Company's financial statements. The financial statements and
notes are representations of the Company's management which is
responsible for their integrity and objectivity. These accounting
policies conform to generally accepted accounting principles and
have been consistently applied in the preparation of the
financial statements.
PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements include the
results of operations of Clarion House, Inc. and Insecta Sales,
Inc. its wholly owned subsidiary, for the years ended December
31, 1996 and 1995. All significant intercompany activities
between Clarion House, Inc. and its wholly-owned subsidiary have
been eliminated in consolidation.
BUSINESS ACTIVITY
Clarion House, Inc. is a holding company.
Insecta Sales, Inc. (the Subsidiary) is principally engaged in
the manufacture and distribution of insecticidal products within
the United States.
CASH AND CASH EQUIVALENTS
For purposes of the statement of cash flows, cash equivalents
include all highly liquid debt instruments with original
maturities of three months or less.
INVENTORIES
Inventories are valued on the first-in, first-out method based on
the lower of cost or market.
PROPERTY AND EQUIPMENT
Improvements and equipment are carried at cost. Major
replacements and refurbishings are charged to the property
accounts while replacements, maintenance and repairs which do not
improve or extend the life of the respective assets are expensed
currently.
DEPRECIATION
Depreciation is calculated by use of the straight-line and
accelerated cost recovery methods over useful lives of 5 to 10
years.
10
<PAGE>
CLARION HOUSE, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
DECEMBER 31, 1996
(SEE ACCOUNTANTS' COMPILATION REPORT)
(UNAUDITED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIE - CONTINUED:
INCOME TAXES
Deferred income taxes are reported using the liability method.
Deferred tax assets are recognized for deductible temporary
differences and deferred tax liabilities are recognized for
taxable temporary differences. Temporary differences are the
differences between the reported amounts of assets and
liabilities and their tax bases. Deferred tax assets are reduced
by a valuation allowance when, in the opinion of management, it
is more likely than not that some portion or all of the deferred
tax assets will not be realized. Deferred tax assets and
liabilities are adjusted for the effects of changes in tax laws
and rates on the date of enactment.
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 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 2 - NOTES PAYABLE:
Notes payable consists of accounts payable that were converted to
notes payable. The notes are due on demand and bear interest at
10%.
NOTE 3 - FEDERAL INCOME TAX:
The Company accounts for income taxes under the provisions of
Statement of Financial Accounting Standards (SFAS) No. 109,
ACCOUNTING FOR INCOME TAXES, which requires an asset and
liability approach to financial accounting and reporting for
income taxes. The difference between financial statement and tax
basis of assets and liabilities is determined annually. Deferred
income tax assets and liabilities are computed for those
differences that have future tax consequences using the currently
enacted tax laws and rates that apply to the periods in which
they are expected to effect taxable income. Valuation allowances
are established, if necessary, to reduce the deferred tax asset
to the amount that will more likely than not be realized. Income
tax expense is the current tax payable or refundable for the
period plus or minus the net change in the income reported for
financial statement purposes which differs from income reported
for tax purposes principally because of the methods of
recognizing depreciation expense. Deferred income taxes have been
provided for timing differences.
11
<PAGE>
CLARION HOUSE, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
DECEMBER 31, 1996
(SEE ACCOUNTANTS' COMPILATION REPORT)
(UNAUDITED)
NOTE 3 - FEDERAL INCOME TAX - CONTINUED:
The Company's total deferred tax asset and deferred tax asset
valuation allowances resulting from net operating loss
carryforwards at December 31, 1996 and 1995 are as follows:
<TABLE>
<CAPTION>
1996 1995
------------ ------------
<S> <C> <C>
Total deferred tax assets $ 292,700 $ 291,000
Less valuation allowance 292,700 291,000
------------ ------------
Total deferred tax assets (current) $ - $ -
============ ============
</TABLE>
Future profits are not reasonably expected to be generated.
Therefore, a valuation allowance has been recorded. For tax
return purposes, the Company has approximately $860,900 and
$856,000 of net operating loss carryforwards as of December 31,
1996 and 1995. The net operating loss carryforwards expire as
follows:
2006 $ 24,300
2007 14,100
2008 43,400
2009 310,100
2010 464,100
2011 4,900
------------
$ 860,900
============
12
<PAGE>
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Inapplicable.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
(a) Identify Directors and Executive Officers.
------------------------------------------
The directors and executive officers of the Company are as follows:
NAME AGE POSITION
- --------------------- --------- ----------------------------------------
Troy D. Wiseman 32 Chairman, Chief Executive Officer and
Director
Brian C. Manoogian 49 Director
R. Townley Rose, Jr. 44 Executive Vice President and Director
Robert C. Copple 44 Vice President - Finance
TROY D. WISEMAN has been the Chairman and a Director of the Company since
February 1998 and Chief Executive Officer since April 1998. Mr. Wiseman is the
principle founder and President of Invest L'Inc., a company specializing in
providing financial consulting services and bridge financing to emerging growth
companies preparing for an initial public offering. Mr. Wiseman also serves as
the Manager of Invest L'Inc. Bridge Fund, LLC, a privately held investment fund
which provides short term financing to both privately and publicly held
companies. Mr. Wiseman is founder and President of Apportum Consulting Corp., a
New York based business consulting firm currently specializing in assisting
micro-cap companies in "going public" through reverse mergers. Mr. Wiseman was
co-founder of CAMI'Z Inc., a publicly traded retail company where he served as a
member of the Board of Directors and held various executive officer positions
including Vice President, Chief Operating Officer, Chief Financial Officer and
Secretary from 1987 to 1994. In 1994, CAMI'Z Inc. acquired Chauvin
International, Ltd. by merger and became B.U.M. International, Inc.
<PAGE>
BRIAN C. MANOOGIAN has been a Director of the Company since November 1997. From
November 1997 to July 1998 he also served as President. Prior to joining the
Company, Mr. Manoogian practiced corporate and business law for over 20 years in
Michigan. Mr. Manoogian began his legal career as the Assistant Corporate
Counsel of Masco Corporation, a position he held for three years, and has been a
partner in small and medium size law firms. Mr. Manoogian received a Bachelors
degree from the University of Michigan and a Juris Doctor from the Detroit
College of Law.
R. TOWNLEY ROSE, JR. has been a Director of the Company since February 1998 and
Executive Vice President since April 1998. Mr. Rose has over 26 years of
experience as a sales representative in plastics and metal fabrication in
numerous industries, with specialization in the heavy duty truck market.
ROBERT C. COPPLE has been the Vice President - Finance of the Company since
December 1997. From May 1992 to December 1997, Mr. Copple was the Division
Controller for the Plastics Division of Plastech (formerly Bryan Custom
Plastics, a division of United Screw & Bolt Corporation). Prior to joining
Plastech in 1992, Mr. Copple was the Diversified Products Controller for
Aeroquip-Vickers (formerly Trinova Corporation). Mr. Copple began his career as
a Certified Public Accountant with a firm located in Elkhart, Indiana. Mr.
Copple has sixteen years of experience in the plastics industry.
Directors serve terms of one year or until their successors are duly elected and
qualified.
(b) Identify Significant Employees.
-------------------------------
Inapplicable.
(c) Family Relationships.
---------------------
Inapplicable.
(d) Involvement in Certain Legal Proceedings.
-----------------------------------------
Inapplicable.
(e) Compliance with Section 16(a) of the Exchange Act.
--------------------------------------------------
No person was subject to Section 16 of the Exchange Act with respect to
the Company and failed to file a report required by Section 16(a) on a timely
basis during the most recent fiscal year.
13
<PAGE>
ITEM 10. EXECUTIVE COMPENSATION
No person received any compensation for services rendered to the
Company during the fiscal year ended December 31, 1996.
Compensation Pursuant to Plans.
-------------------------------
There were no grants or awards of stock options or stock appreciation
rights to any named executive officer during the fiscal year ended December 31,
1996. In addition, during the fiscal year ended December 31, 1996 there were no
options or stock appreciation rights exercised by, nor any long term incentive
plan awards made to, any named executive officer.
Compensation of Directors.
--------------------------
Directors of the Company are not compensated for any services provided
as a director.
Termination of Employment and Change in Control Arrangements.
-------------------------------------------------------------
Inapplicable.
14
<PAGE>
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
ownership of the Company's Common Stock as August 27, 1998 by (i) each person
who is known to own beneficially more than 5% of the outstanding shares of
Common Stock; (ii) by each of the Company's directors, executive officers and
nominees for director; and (iii) by all directors and executive officers of the
Company as a group. Unless otherwise indicated below, the person or persons
named have sole voting and dispositive power.
Shareholder Shares Percent
- --------------------------------------- --------------- -------------
Brian C. Manoogian 950,000 9.6%
Troy D. Wiseman(1) 1,858,029 18.7%
R. Townley Rose, Jr. 1,200,000 12.1%
Robert C. Copple(2) 145,000 1.5%
Bryan C. Cressey 1,000,000 10.1%
Terence M. Graunke 1,000,000 10.1%
Robert J. Skandalaris(3) 1,424,255 14.3%
All Executive Officers and Directors 4,153,029 41.8%
as a Group (4 persons)
- ---------------
(1) Includes 799,444 shares held by Invest L'Inc. Bridge Fund, LLC, a private
investment fund for which Mr. Wiseman acts as Manager and holds an equity
interest; 116,000 shares held by Apportum Consulting Corp., and entity of
which Mr. Wiseman is an officer, director and the sole shareholder; 874,255
held by Mr. Wiseman's family trust; 20,000 shares held as custodian for Mr.
Wiseman's children and 48,330 shares held by Invest L'Inc., an entity of
which Mr. Wiseman in an officer, director and the sole shareholder.
(2) Includes 50,000 shares held in escrow pending satisfaction of certain
earnings conditions pursuant to Mr. Copple's employment agreement with the
Company.
(3) Includes 250,000 held as custodian for Mr. Skandalaris' children and
874,255 shares held by Invest L'Inc. Bridge Fund, LLC, a private investment
fund in which Mr. Skandalaris holds an equity interest.
15
<PAGE>
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Inapplicable.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits and index of exhibits.
-------------------------------
3.1 Articles of Incorporation of the Company
3.2 Bylaws of the Company
4.1 Sample Stock Certificate
(b) Reports on Form 8-K.
--------------------
Inapplicable.
16
<PAGE> 20
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
CLARION HOUSE, INC.
Dated: September 24, 1998 By: /s/ Troy D. Wiseman
----------------------------
Troy D. Wiseman,
Chief Executive Officer
In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Troy D. Wiseman Chief Executive Officer September 24, 1998
- ------------------------ Chairman of the Board of
Troy D. Wiseman Directors
/s/ R. Townley Rose, Jr. Executive Vice-President September 24, 1998
- ------------------------ and Director
R. Townley Rose, Jr.
/s/ Brian C. Manoogian Director September 24, 1998
- ------------------------
Brian C. Manoogian
/s/ Robert C. Copple Executive Vice-President September 24, 1998
- ------------------------ Finance
Robert C. Copple
17
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 19
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 19
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1340
<CURRENT-LIABILITIES> 137165
<BONDS> 0
0
0
<COMMON> 15329
<OTHER-SE> (151154)
<TOTAL-LIABILITY-AND-EQUITY> 1340
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 33347
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 62711
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (4865)
<INCOME-TAX> 0
<INCOME-CONTINUING> (4865)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4865)
<EPS-PRIMARY> (.003)
<EPS-DILUTED> (.003)
</TABLE>
