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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 3
INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES
Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934,
Section 17(a) of the Public Utility Holding Company Act of 1935 or
Section 30(f) of the Investment Company Act of 1940
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1. Name and Address of Reporting Person*
CAPITOL BAY MANAGEMENT, INC.
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(Last) (First) (Middle)
2424 PROFESSIONAL DRIVE
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(Street)
ROSEVILLE, CALIFORNIA 95661
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(City) (State) (Zip)
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2. Date of Event Requiring Statement (Month/Day/Year)
JULY 9, 1999
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3. I.R.S. Identification Number of Reporting Person, if an entity (voluntary)
680308736
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4. Issuer Name and Ticker or Trading Symbol
MORROW SNOWBOARDS, INC.
(MRRWE)
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5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
[ ] Director [X] 10% Owner
[ ] Officer (give title below) [ ] Other (specify below)
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6. If Amendment, Date of Original (Month/Year)
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7. Individual or Joint/Group Filing (Check applicable line)
[ ] Form Filed by One Reporting Person
[X] Form Filed by More than One Reporting Person
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<TABLE>
<CAPTION>
Table I - Non-Derivative Securities Beneficially Owned
1. Title of Security 2. Amount of Securities 3. Ownership Form: Direct 4. Nature of Indirect Beneficial Ownership
(Instr.4) Beneficially Owned (D) or Indirect (I) (Instr. 5)
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Common Stock No Par Value 02 02 02 02
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<S> <C> <C> <C>
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Table II Derivative Securities Beneficially Owned (E.G., puts, calls,
warrants, options, convertible securities)
1. Title of Derivative 2. Date Exercisable 3. Title and Amount of Securities 4. Conversion 5. Ownership 6. Nature of Indirect
Security and Expiration Date Underlying Derivative Security Exercise Form of Beneficial Ownership
(Month, Day, Year) (Inst. 4) Price of Derivative (Instr. 5)
Derivative Security:
Date Exercisable Expiration Date Title Amount or Security Direct (D) or
Number of Indirect (I)
Shares (Instr. 5)
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Stock Option 03 03 Common Stock, No Par Value 01 01 02 02
(Right to Buy) 01
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Instruction 5(b)(v) list of other Reporting Persons:
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This statement is being filed by Capitol Bay Management, Inc. ("CBM");
Capitol Bay Securities, Inc. ("CBS"); Capitol Bay Group, Inc. ("CBG"); and
Stephen C. Kircher ("Mr. Kircher") (collectively the "Reporting Persons"). The
principal business address of each of the Reporting Persons is 2424 Professional
Drive, Roseville, CA 95661.
Explanation of Responses:
01: On March 30, 1999, certain trade creditors of Morrow Snowboards, Inc.
("MSI") filed an involuntary petition for relief under Chapter 7 of the United
States Bankruptcy Code in the District of Oregon ("Involuntary Petition"). MSI
reached a settlement with such creditors pursuant to which MSI and the creditors
filed a joint motion to dismiss the Involuntary Petition. On April 27, 1999,
MSI's Board of Directors authorized MSI to enter into a binding Memorandum of
Understanding ("MOU") with CBM whereby CBM would provide MSI with additional
financing to be used as working capital. Pursuant to the MOU, CBM purchased from
MSI's then lender, Foothill Capital Corporation ("Foothill"), Foothill's secured
lender position. As set forth in the MOU, upon dismissal of the Involuntary
Petition, which became final on June 28, 1999, CBM may elect to convert $500,000
of the Foothill loan into 2,000,000 shares (as presently constituted),
contingent upon CBM performing its agreements under the MOU. On July 9, 1999,
MSI's Board of Directors determined that such conditions have been met to allow
the conversion of the loan and also authorized the sale of an additional
1,000,000 shares at $.25 per share.
02: CBS may be deemed to own beneficially and directly 180,400 shares. CBS
is a wholly-owned subsidiary of CBG and CBG is majority-owned by Mr.
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Kircher. CBG and Mr. Kircher may be deemed to own beneficially and indirectly
such 180,400 shares. CBG and Mr. Kircher each disclaim beneficial ownership of
such shares owned by CBS except to the extent of pecuniary interest therein.
CBM may be deemed to own beneficially and directly 3,000,000 shares.
CBM is a wholly-owned subsidiary of CBG and CBG is majority-owned by Mr.
Kircher. CBG and Mr. Kircher may be deemed to own beneficially and indirectly
such 3,000,000 shares. CBG and Mr. Kircher each disclaim beneficial ownership of
such shares owned by CBM except to the extent of pecuniary interest therein.
03: There are no exercise or expiration dates restricting the purchase of
derivative securities set forth herein.
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Signatures:
Date: July 21, 1999
CAPITOL BAY MANAGEMENT, INC.
By: /s/ Stephen C. Kircher
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Stephen C. Kircher
President
CAPITOL BAY SECURITIES, INC.
By: /s/ Stephen C. Kircher
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Stephen C. Kircher
President
CAPITOL BAY GROUP, INC.
By: /s/ Stephen C. Kircher
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Stephen C. Kircher
President
STEPHEN C. KIRCHER
By: /s/ Stephen C. Kircher
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Stephen C. Kircher
as an individual
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** Intentional misstatements or omissions of facts constitute Federal Criminal
Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually
signed. If space provided is insufficient, See Instruction 6
for procedure.
Alternatively, this form is permitted to be submitted to the Commission
in electronic format at the option of the reporting person pursuant to Rule
101(b)(4) of Regulation S-T.
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