Quarterly Report — Small Business — Form 10-QSB Filing Table of Contents
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Check
whether the issuer (1) filed all reports required to be filed by Section 13
or
15(d) of the Exchange Act during the last 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 o
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes x No o
The
number of shares of Common Stock, $0.001 par value, outstanding on June 30,2008, was 65,117,807 shares; however, 35,000,000 of these shares are on
administrative hold and in dispute.
Transitional
Small Business Disclosure Format (check one): Yes o
No x
PART
I – FINANCIAL INFORMATION
Item
1. Financial Statements
MOORE
& ASSOCIATES, CHARTERED
ACCOUNTANTS
AND ADVISORS
PCAOB
REGISTERED
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
the
Board of Directors
Brisam
Corporation
(Formerly
Skynet Telematics, Inc.)
We
have
reviewed the accompanying condensed balance sheet of Brisam Corporation as
of
June 30, 2007, and the related condensed statements of operations and cash
flows
for the three-month and six-month periods ended June 30, 2007 and 2006. These
interim financial statements are the responsibility of the Corporation’s
management.
We
conduct our reviews in accordance with the standards of the Public Company
Accounting Oversight Board (United States). A review of interim financial
information consists of principally applying analytical procedures and making
inquiries of persons responsible for the financials and accounting matters.
It
is substantially less in scope than an audit conducted in accordance with the
standards of the Public Company Accounting Oversight Board (United States),
the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an
opinion.
Based
on
our reviews, we are not aware of any material modifications that should be
made
to such condensed financial statements for them to be in conformity with
accounting principles generally accepted in the United States of
America.
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company has incurred a net loss of approximately $19,566,071
through June 30, 2007, which raises substantial doubt about its ability to
continue as a going concern. Management’s plans concerning these matters are
also described in Note 2. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
We
have
previously audited, in accordance with standards of the Public Company
Accounting Oversight Board (United States), the balance sheet of Brisam
Corporation (formerly Skynet Telematics, Inc.) as of December 31, 2006 and
2005,
and the related statements of operations, stockholders’ equity and cash flows
for the years then ended (not presented herein); and in our report dated April26, 2007, we expressed an unqualified opinion with a going concern paragraph
on
those financial statements. In our opinion, the information set forth in the
accompanying balance sheet as of December 31, 2006 is fairly stated, in all
material respects, in relations to the balance sheet from which it has been
derived.
Adjustments
to reconcile net (loss) to net cash (used) in operating
activities:
Prepaid
expenses and other current assets
(1,966
)
-
Accounts
payable and accrued expenses
(8,894
)
-
Net
cash (used) by operating activities
(18,669
)
-
Cash
flows from investing activities
Net
cash (used) by investing activities
-
-
Cash
flows from financing activities
Proceeds
from notes payable – related party
10,000
-
Net
cash provided by financing activities
10,000
-
Net
increase (decrease) in cash
(8,669
)
-
Cash
– beginning
8,669
11,719
Cash
– ending
$
-
$
11,719
Supplemental
disclosures:
Interest
paid
$
-
$
-
Income
taxes paid
$
-
$
-
The
Accompanying Notes are an Integral Part of These Financial
Statements.
5
Brisam
Corporation
(formerly
Skynet Telematics, Inc.)
Notes
to Condensed Financial Statements
(Unaudited)
Note
1 – Basis of presentation
The
consolidated interim financial statements included herein, presented in
accordance with United States generally accepted accounting principles and
stated in US dollars, have been prepared by the Company, without audit, pursuant
to the rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although the
Company believes that the disclosures are adequate to make the information
presented not misleading.
These
statements reflect all adjustments, consisting of normal recurring adjustments,
which, in the opinion of management, are necessary for fair presentation of
the
information contained therein. It is suggested that these consolidated interim
financial statements be read in conjunction with the financial statements of
the
Company for the year ended December 31, 2006 and notes thereto. The Company
follows the same accounting policies in the preparation of interim
reports.
Results
of operations for the interim periods are not indicative of annual
results.
Reclassifications
Certain
reclassifications have been made to the prior years’ financial statements to
conform to the current year presentation. These reclassifications had no effect
on previously reported results of operations or retained earnings.
Note
2 – Going concern
The
accompanying financial statements have been prepared on a going concern basis,
which contemplates the realization of assets and the satisfaction of liabilities
in the normal course of business. The Company has incurred net losses of
approximately $19,566,071 through June 30, 2007.
These
conditions give rise to doubt about the Company’s ability to continue as a going
concern. These financial statements do not include adjustments relating to
the
recoverability and classification of reported asset amounts or the amount and
classification of liabilities that might be necessary should the Company be
unable to continue as a going concern. The Company’s continuation as a going
concern is dependent upon its ability to obtain additional financing or sale
of
its common stock as may be required and ultimately to attain
profitability.
Note
3 – Related party transactions
During
the period ended June 30, 2007, our sole officer and director, Mr. Kitts,
advanced $10,000 directly to our auditor for professional fees in connection
with the audit and review of out financial statements for the period of December31, 2002 though December 31, 2005. We have recorded a note payable to Mr. Kitts
in the amount of $10,000. The note is non-interest bearing and due on
demand.
6
Note
4 –
Stockholders’ equity
The
Company is authorized to issue 20,000,000 shares of $0.001 par value preferred
stock and 500,000,000 shares of $0.001 par value common stock.
On
August10, 2007, the Company authorized a 100:1 reverse split of its issued and
outstanding shares of common stock. All share information has been retroactively
restated.
Note
5 – Subsequent events
On
July31, 2007, the Company authorized the issuance of 35,000 shares of its common
stock to an individual for services valued at $350 to be issued after the August10, 2007 reverse stock split.
On
October 2, 2007, the Company entered into a Business Development and Consulting
Agreement with Reber America, Inc. a Canadian corporation whereby the Company
has agreed to provide marketing and development services in exchange for a
monthly fee of $20,000. Further the Company agreed to accrue all payments until
such time Reber has obtained sufficient working capital resources.
On
November 11, 2007, the Company issued 25,471,450 shares of its restricted common
stock to its then sole officer and director for services valued at
$25,472.
On
January 21, 2008, the Company issued 1,550,000 shares of its restricted common
stock for legal, accounting and consulting services valued at $1,550.
On
February 14, 2008, the Company formed Brisam Energy, Inc., a wholly owned
subsidiary and entered into an agreement with Trillium Management Ltd. a
Canadian Corporation specializing in providing capital globally to companies
focused in the natural resource sector.
On
May 6,2008, the former officer and director of the Company had 35,000,000 shares
of
the Company’s common stock issued to himself for purported services valued at
$35,000. These shares have been placed on administrative hold with the Company’s
transfer agent and are in dispute. However, as of the date hereof neither party
has initiated a legal action regarding this issue.
On
May15, 2008, the Company issued 1,000,000 shares of its class A preferred stock
to
its sole officer and director for services.
7
FORWARD-LOOKING
STATEMENTS
This
document contains “forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements other than statements
of historical fact are “forward-looking statements” for purposes of federal and
state securities laws, including, but not limited to, any projections of
earnings, revenue or other financial items; any statements of the plans,
strategies and objections of management for future operations; any statements
concerning proposed new services or developments; any statements regarding
future economic conditions or performance; any statements or belief; and any
statements of assumptions underlying any of the foregoing.
Forward-looking
statements may include the words “may,”“could,”“estimate,”“intend,”“continue,”“believe,”“expect” or “anticipate” or other similar words. These
forward-looking statements present our estimates and assumptions only as of
the
date of this report. Accordingly, readers are cautioned not to place undue
reliance on forward-looking statements, which speak only as of the dates on
which they are made. We do not undertake to update forward-looking statements
to
reflect the impact of circumstances or events that arise after the dates they
are made. You should, however, consult further disclosures we make in future
filings of our Annual Report on Form 10-KSB, Quarterly Reports on Form 10-QSB
and Current Reports on Form 8-K.
Although
we believe that the expectations reflected in any of our forward-looking
statements are reasonable, actual results could differ materially from those
projected or assumed in any of our forward-looking statements. Our future
financial condition and results of operations, as well as any forward-looking
statements, are subject to change and inherent risks and uncertainties. The
factors impacting these risks and uncertainties include, but are not limited
to:
·
inability
to raise additional financing for working
capital;
·
inability
to locate potential mergers and acquisitions and integrate acquired
companies into our organization;
·
deterioration
in general or regional economic, market and political
conditions;
·
the
fact that our accounting policies and methods are fundamental to
how we
report our financial condition and results of operations, and they
may
require management to make estimates about matters that are inherently
uncertain;
·
adverse
state or federal legislation or regulation that increases the costs
of
compliance, or adverse findings by a regulator with respect to existing
operations;
·
changes
in U.S. GAAP or in the legal, regulatory and legislative environments
in
the markets in which we operate;
·
inability
to efficiently manage our
operations;
·
inability
to achieve future operating
results;
·
the
unavailability of funds for working capital;
·
our
ability to recruit and hire key employees;
·
the
inability of management to effectively implement our strategies and
business plans; and
·
the
other risks and uncertainties detailed in this
report.
For
a
detailed description of these and other factors that could cause actual results
to differ materially from those expressed in any forward-looking statement,
please see “Factors That May Affect Our Results of Operation” in this
document.
Item
2. Management’s Discussion and Analysis
Overview
of Current Operations
Brisam
Corporation (“Brisam” or the “Company”) was incorporated under the laws of
Nevada on March 14, 1990 under the name Peripheral Connections, Inc. In 1998,
the name was changed to Skynet Telematics, Inc., then to Skynet Telematics.com,
Inc. in 2000 and again back to Skynet Telematics, Inc. in 2002. Finally, in
July
2007 the name was changed to Brisam Corporation.
The
original business plan of the Company, during the period it was known as Skynet,
was the development, marketing, and distribution of integrated modular
automotive telematic systems and providing monitoring services to users of
those
products. Automotive telematic systems combine the technologies for mobile
phones (GSM), global positioning satellite systems (GPS) and the Internet to
enable customers to identify the exact location and status information about
vehicles, to receive certain theft protection, personal security measures,
e-mail, Internet access and concierge services through a monitoring station,
and
to receive a variety of information through communication with the monitoring
station.
Skynet’s
original business plan was not financially successful through the period ended
June 30, 2007 and the Company was assessing various options and new business
strategies. The analysis of new businesses opportunities and evaluating new
business strategies will be undertaken by or under the supervision of the
Company’s President. In analyzing prospective business opportunities, management
will consider, to the extent applicable, the available technical, financial
and
managerial resources of any given business venture. Management will also
consider the nature of present and expected competition; potential advances
in
research and development or exploration; the potential for growth and expansion;
the likelihood of sustaining a profit within given time frames; the perceived
public recognition or acceptance of products, services, trade or service marks;
name identification; and other relevant factors. The Company anticipates that
the results of operations of a specific business venture may not necessarily
be
indicative of the potential for future earnings, which may be impacted by a
change in marketing strategies, business expansion, modifying product emphasis,
changing or substantially augmenting management, and other factors.
The
Company will analyze all relevant factors and make a determination based on
a
composite of available information, without reliance on any single factor.
The
period within which the Company will decide to participate in a given business
venture cannot be predicted and will depend on certain factors, including the
time involved in identifying businesses, the time required for the Company
to
complete its analysis of such businesses, the time required to prepare
appropriate documentation and other circumstances.
The
Company has not achieved profitability to date, and the Company anticipates
that
it will continue to incur net losses for the foreseeable future. As of June30,2007, the Company had an accumulated deficit of $19,566,071 dollars. There
can
be no assurances that the Company can achieve or sustain profitability or that
the Company’s operating losses will not increase in the future.
Subsequent
to the quarter ended June 30, 2007, the Company’s prior management located an
individual, Mr. Brian Kitts, which it thought had the necessary skills and
business acumen necessary to develop a new business plan and enhance stockholder
value. On October 1, 2007, Mr. Kitts was appointed as the Company’s sole officer
and director. As his first endeavor, Mr. Kitts located a private company in
need
of business development consulting to enhance its products and services. On
October 2, 2007, the Company entered into a business development agreement
with
Reber America, Inc., whereby the Company, primarily through Mr. Kitts, provides
business development consulting services for Reber in exchange for compensation
of $20,000 per month. A copy of the Reber agreement is attached hereto as
Exhibit 10.1.
In
addition to the agreement described above, subsequent to the quarter ended
June30, 2007, the Company located a potential strategic partner for locating and
participating in natural resource opportunities in Canada. To pursue this
opportunity the Company formed Brisam Energy, Inc. as a wholly owned subsidiary
and on February 14, 2008 Brisam Energy entered into a letter agreement with
Trillium Management Ltd., whereby Trillium will locate certain opportunities
for
review by Brisam Energy and Brisam Energy will use its best efforts to fund
Trillium with up to $5 million to be used for funding and development
opportunities. To date, Trillium has not located or proposed any definitive
opportunities; however, the parties are in continual discussions regarding
locating and funding an opportunity during fiscal 2008. A copy of the Trillium
letter agreement was attached as Exhibit 10.7 to the Form 8-K filed on March6,2008.
Results
of Operations
During
the periods ended June 30, 2007 and June 30, 2006, the Company did not generate
any revenues while it was in search of opportunities to expand or enhance its
business operations. However, on October 2, 2007, the Company entered into
an
agreement with Reber America, Inc. to provide business development consulting
services for $20,000 per month. The Company intends on pursuing similar types
of
consulting agreements along with entering the natural resource and energy
industry through its wholly owned subsidiary, Brisam Energy, Inc.
During
the quarter ended June 30, 2007, the Company had a net loss $22,437 as compared
to no loss or expenses for the same period in 2006. The $22,437 in expenses
for
the quarter ended June 30, 2007 represented general and administrative expenses
and
professional fees.
Satisfaction
of our cash obligations for the next 12 months.
Management
believes the Company can sustain itself for the next twelve months. Management
has agreed to keep the Company funded at its own expense, without seeking
reimbursement for expenses paid. The Company’s need for capital may change
dramatically if it moves forward in developing a new business strategy or it
acquires an interest in a business opportunity. In the event the Company
requires additional funds, the Company will have to seek loans or equity
placements to cover such cash needs. There is no assurance additional capital
will be available to the Company on acceptable terms.
Going
Concern
The
condensed financial statements included in this filing have been prepared in
conformity with generally accepted accounting principles that contemplate the
continuance of the Company as a going concern. The Company’s cash position may
be inadequate to pay all of the costs associated with its intended business
plan. Management intends to use borrowings and security sales to mitigate the
effects of its cash position, however no assurance can be given that debt or
equity financing, if and when required, will be available. The financial
statements do not include any adjustments relating to the recoverability and
classification of recorded assets and classification of liabilities that might
be necessary should the Company be unable to continue existence.
Summary
of any product research and development that we will perform for the term of
our
plan of operation.
We
do not
anticipate performing any additional significant product research and
development under our current plan of operation.
Expected
purchase or sale of plant and significant equipment.
We
do not
anticipate the purchase or sale of any plant or significant equipment; as such
items are not required by us at this time.
Significant
changes in the number of employees.
As
of
June 30, 2007, we did not have any employees. We are dependent upon Brian Kitts,
our sole officer and a director for our future business development. As our
operations expand we anticipate the need to hire additional employees,
consultants and professionals; however, the exact number is not quantifiable
at
this time.
LIQUIDITY
AND CAPITAL RESOURCES
A
critical component of our operating plan impacting our continued existence
is
the ability to obtain additional capital through additional equity and/or debt
financing. We do not anticipate generating sufficient positive internal
operating cash flow until such time as we can expand our consulting services,
complete company acquisitions or successfully enter the energy industry and
generate substantial revenues, which may take the next few years to fully
realize. In the event we cannot obtain the necessary capital to pursue our
strategic plan, we may have to cease or significantly curtail our operations.
This would materially impact our ability to continue operations.
The
Company has limited financial resources available, which has had an adverse
impact on the Company’s liquidity, activities and operations. These limitations
have adversely affected the Company’s ability to obtain certain projects and
pursue additional business. Without realization of additional capital, it would
be unlikely for the Company to continue as a going concern. In order for the
Company to remain a Going Concern it will need to find additional capital.
Additional working capital may be sought through additional debt or equity
private placements, additional notes payable to banks or related parties
(officers, directors or stockholders), or from other available funding sources
at market rates of interest, or a combination of these. The ability to raise
necessary financing will depend on many factors, including the nature and
prospects of any business to be acquired and the economic and market conditions
prevailing at the time financing is sought. No assurances can be given that
any
necessary financing can be obtained on terms favorable to the Company, or at
all.
As
a
result of the Company’s current limited available cash, no officer or director
received compensation through the quarter ended June 30, 2007. The Company
has
no employment agreements in place with its officers.
Off-Balance
Sheet Arrangements
We
do not
have any off-balance sheet arrangements that have or are reasonably likely
to
have a current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results or operations, liquidity, capital
expenditures or capital resources that is material to investors.
Critical
Accounting Policies and Estimates
Revenue
Recognition:
We
recognize revenue from product sales once all of the following criteria for
revenue recognition have been met: pervasive evidence that an agreement exists;
the services have been rendered; the fee is fixed and determinable and not
subject to refund or adjustment; and collection of the amount due is reasonable
assured.
New
Accounting Standards
In
September 2006, the FASB issued Statement of Financial Accounting Standards
No. 157, Fair
Value Measurements,
(“SFAS
157”). SFAS 157 provides a framework for measuring fair value when such
measurements are used for accounting purposes. The framework focuses on an
exit
price in the principal (or, alternatively, the most advantageous) market
accessible in an orderly transaction between willing market participants. SFAS
157 establishes a three-tiered fair value hierarchy with Level 1 representing
quoted prices for identical assets or liabilities in an active market and Level
3 representing estimated values based on unobservable inputs. Under SFAS 157,
related disclosures are segregated for assets and liabilities measured at fair
value based on the level used within the hierarchy to determine their fair
values. We anticipate adopting SFAS 157 on its effective date of January 1,2008 and the financial impact, if any, upon adoption has not yet been
determined.
In
February 2007, the FASB issued Statement of Financial Accounting Standards
No. 159, The
Fair Value Option for Financial Assets and Financial Liabilities, including
an
amendment of FASB Statement No. 115, (“SFAS
159”). SFAS 159 permits fair value accounting to be irrevocably elected for
certain financial assets and liabilities on an individual contract basis at
the
time of acquisition or at a remeasurement event date. Upon adoption of SFAS
159,
fair value accounting may also be elected for existing financial assets and
liabilities. For those instruments for which fair value accounting is elected,
changes in fair value will be recognized in earnings and fees and costs
associated with origination or acquisition will be recognized as incurred rather
than deferred. SFAS 159 is effective January 1, 2008, with early adoption
permitted as of January 1, 2007. We anticipate adopting SFAS 159 concurrent
with the adoption of SFAS 157 on January 1, 2008, but have not yet
determined the financial impact, if any, upon adoption.
FACTORS
THAT MAY AFFECT OUR RESULTS OF OPERATION
Risks
Relating To Our Business and Marketplace
An
evaluation of us extremely difficult. At this stage of our business operations,
even with our good faith efforts, potential investors have a high probability
of
losing their investment.
There
is
nothing at this time on which to base an assumption that our business operations
will prove to be successful or that we will ever be able to operate profitably.
Our future operating results will depend on many factors, including our ability
to raise adequate working capital, demand and acceptance of our business plan,
the level of our competition and our ability to attract and maintain key
management and employees.
While
Management believes its estimates of projected occurrences and events are within
the timetable of its business plan, there can be no guarantees or assurances
that the results anticipated will occur.
Our
auditor’s report reflects the fact that without realization of additional
capital, it would be unlikely for us to continue as a going concern. If we
are
unable to continue as a going concern, it is likely that we will not be able
to
continue in business.
As
a
result of our deficiency in working capital and other factors, our auditors
have
included a paragraph in their report regarding substantial doubt about our
ability to continue as a going concern. Our plans in this regard are to seek
additional funding through future equity private placements or debt
facilities.
We
may not be able to retain our key personnel or hire the personnel we need to
sustain and grow our business.
Our
performance is highly dependent upon our ability to attract, retain, and
motivate highly skilled, talented employees. These professionals are regularly
recruited by other firms and may choose to change firms. Given our relatively
small size compared to some of our anticipated competitors, the performance
of
our business may be more adversely affected than our competitors would be if
we
lose well-performing employees and are unable to attract new ones.
Risks
Relating To Our Common Stock
Because
our common stock is deemed a low-priced “Penny” stock, an investment in our
common stock should be considered high risk and subject to marketability
restrictions.
Since
our
common stock is a penny stock, as defined in Rule 3a51-1 under the Securities
Exchange Act, it will be more difficult for investors to liquidate their
investment even if and when a market develops for the common stock. Until the
trading price of the common stock rises above $5.00 per share, if ever, trading
in the common stock is subject to the penny stock rules of the Securities
Exchange Act specified in rules 15g-1 through 15g-10. Those rules require
broker-dealers, before effecting transactions in any penny stock,
to:
·
Deliver
to the customer, and obtain a written receipt for, a disclosure
document;
·
Disclose
certain price information about the
stock;
·
Disclose
the amount of compensation received by the broker-dealer or any associated
person of the broker-dealer;
·
Send
monthly statements to customers with market and price information
about
the penny stock; and
·
In
some circumstances, approve the purchaser’s account under certain
standards and deliver written statements to the customer with information
specified in the rules.
Consequently,
the penny stock rules may restrict the ability or willingness of broker-dealers
to sell the common stock and may affect the ability of holders to sell their
common stock in the secondary market and the price at which such holders can
sell any such securities. These
additional procedures could also limit our ability to raise additional capital
in the future.
We
have the ability to issue additional shares of our common stock and shares
of
preferred stock without asking for stockholder approval, which could cause
your
investment to be diluted.
Our
Articles of Incorporation authorizes the Board of Directors to issue up to
500,000,000 shares of common stock and 20,000,000 shares of preferred stock.
The
power of the Board of Directors to issue shares of common stock, preferred
stock
or warrants or options to purchase shares of common stock or preferred stock
is
generally not subject to stockholder approval. Accordingly, any additional
issuance of our common stock, or preferred stock that may be convertible into
common stock, may have the effect of diluting one’s investment.
By
issuing preferred stock, we may be able to delay, defer or prevent a change
of
control.
Our
board
of directors is authorized to issue, without approval from our stockholders,
a
total of 20,000,000 shares of preferred stock. In June 2008, our board of
directors issued 1,000,000 shares of Class A preferred stock that have super
voting and conversion rights. Our Board of Directors can determine the rights,
preferences, privileges and restrictions granted to, or imposed upon, the shares
of preferred stock and to fix the number of shares constituting any series
and
the designation of such series. It is possible that our Board of Directors,
in
determining the rights, preferences and privileges to be granted when the
preferred stock is issued, may include provisions that have the effect of
delaying, deferring or preventing a change in control, discouraging bids for
our
common stock at a premium over the market price, or that adversely affect the
market price of and the voting and other rights of the holders of our common
stock.
FINRA
sales practice requirements may also limit a stockholder’s ability to buy and
sell our stock.
In
addition to the “penny stock” rules described above, FINRA has adopted rules
that require that in recommending an investment to a customer, a broker-dealer
must have reasonable grounds for believing that the investment is suitable
for
that customer. Prior to recommending speculative low priced securities to their
non-institutional customers, broker-dealers must make reasonable efforts to
obtain information about the customer’s financial status, tax status, investment
objectives and other information. Under interpretations of these rules, the
FINRA believes that there is a high probability that speculative low priced
securities will not be suitable for at least some customers. The FINRA
requirements make it more difficult for broker-dealers to recommend that their
customers buy our common stock, which may limit your ability to buy and sell
our
stock and have an adverse effect on the market for our shares.
Item
3. Controls and Procedures
We
maintain disclosure controls and procedures designed to ensure that information
required to be disclosed in reports filed under the Securities Exchange Act
of
1934, as amended, is recorded, processed, summarized and reported within the
specified time periods.
As
of the
end of the period covered by this report, Brian Kitts, our President and
Principal Financial Officer, evaluated the effectiveness of the design and
operation of our disclosure controls and procedures pursuant to Exchange Act
Rule 13a-15. Based upon his evaluation, Mr. Kitts concluded that our
disclosure controls and
procedures were not effective in timely alerting him to material
information required to be included in our periodic
SEC reports. We were unable to meet our requirements to timely file our Exchange
Act reports for the quarter ended June 30, 2007 through March 31, 2008.
Management evaluated the impact of our inability to timely file periodic reports
with the Securities and Exchange Commission on our assessment of our disclosure
controls and procedures and has concluded that the control deficiency that
resulted in the inability to timely make these filings represented a material
weakness.
Other
than the deficiency and weakness described above, Mr. Kitts concluded that
our
disclosure controls and procedures are otherwise effective.
PART
II—OTHER INFORMATION
Item
1. Legal Proceedings
From
time
to time, we may become involved in various lawsuits and legal proceedings,
which
arise in the ordinary course of business. However, litigation is subject to
inherent uncertainties, and an adverse result in these or other matters may
arise from time to time that may harm our business.
On
May 6,2008, Ira Lyons, our previous sole officer and director, issued 35,000,000
shares of common stock to himself. Prior to the issuance, Mr. Lyons had been
removed as a director of the Company by a super majority vote of our
stockholders. Therefore, Mr. Lyons did not have the authority to issue the
35,000,000 shares of common stock. We have placed an administrative hold on
the
shares of common stock and have instructed our transfer agent to place a stop
transfer order on the shares of common stock. Our new sole officer and director,
Brian Kitts, is currently in discussions with Mr. Lyons for the return of the
shares of common stock for cancellation. However, if Mr. Lyons does not return
the shares, we may be forced to initiate legal action against Mr. Lyons for
the
return of the shares, along with any other remedies allowable by
law.
Other
than the potential legal action with Mr. Lyons, we are not presently a party
to
any material litigation, nor to the knowledge of management is any litigation
threatened against us, which may materially affect us.
Item
2. Unregistered Sales of Equity Securities and Use of
Proceeds
On
August10, 2007, we effectuated a hundred-for-one (100:1) reverse Stock Split of our
outstanding shares of common stock, where any stockholder who owned 100 or
fewer
common shares received ten (10) shares. (See Schedule 14c filed with the
Commission on July 13, 2007 regarding this corporate action.)
Subsequent
Issuances
On
July31, 2007, we authorized the issuance of 35,000 shares of common stock for
consulting services valued at $350, which were issued following completion
of
the August 10, 2007 reverse stock split. We believed the issuance of the shares
was exempt from the registration and prospectus delivery requirement of the
Securities Act of 1933 by virtue of Section 4(2). The shares were issued
directly by us and did not involve a public offering or general solicitation.
The recipient of the shares was afforded an opportunity for effective access
to
our files and records that contained the relevant information needed to make
her
investment decision, including our financial statements and 34 Act reports.
We
reasonably believed that the recipient had such knowledge and experience in
her
financial and business matters that she was capable of evaluating the merits
and
risks of her investment.
On
November 16, 2007, we issued 25,471,450 shares of common stock to Brian Kitts
for his services as our sole officer and director valued at $25,471. We believed
the issuance of the shares was exempt from the registration and prospectus
delivery requirement of the Securities Act of 1933 by virtue of Section 4(2).
The shares were issued directly by us and did not involve a public offering
or
general solicitation. The recipient of the shares was afforded an opportunity
for effective access to our files and records that contained the relevant
information needed to make his investment decision, including our financial
statements and 34 Act reports. We reasonably believed that the recipient had
such knowledge and experience in his financial and business matters that he
was
capable of evaluating the merits and risks of his investment. The recipient
was
our sole officer and director at the time of the issuance and his investment
decision.
On
January 21, 2008, we issued 1,550,000 shares of common stock for legal,
accounting and consulting services valued at $1,550. We believed the issuance
of
the shares was exempt from the registration and prospectus delivery requirement
of the Securities Act of 1933 by virtue of Section 4(2). The shares were issued
directly by us and did not involve a public offering or general solicitation.
The recipients of the shares were afforded an opportunity for effective access
to our files and records that contained the relevant information needed to
make
their investment decision, including our financial statements and 34 Act
reports. We reasonably believed that the recipients had such knowledge and
experience in their financial and business matters that they were capable of
evaluating the merits and risks of their investment.
On
May 6,2008, Ira Lyons, our previous sole officer and director, issued 35,000,000
shares of common stock to himself. Prior to the issuance, Mr. Lyons had been
removed as a director of the Company by a super majority vote of our
stockholders. Therefore, Mr. Lyons did not have the authority to issue the
35,000,000 shares of common stock. We have placed an administrative hold on
the
shares of common stock and have instructed our transfer agent to place a stop
transfer order on the shares of common stock. Our new sole officer and director,
Brian Kitts, is currently in discussions with Mr. Lyons for the return of the
shares of common stock for cancellation.
On
May15, 2008, we issued 1,000,000 shares of Super Voting Class A Preferred Stock
(“Class A Preferred Stock”) to Brian Kitts for resuming his services as our sole
officer and director. We believe the issuance of the shares was exempt from
the
registration and prospectus delivery requirement of the Securities Act of 1933
by virtue of Section 4(2). The shares were issued directly by us and did not
involve a public offering or general solicitation. The recipient of the shares
was afforded an opportunity for effective access to our files and records that
contained the relevant information needed to make his investment decision,
including our financial statements and 34 Act reports. We reasonably believed
that the recipient had such knowledge and experience in his financial and
business matters that he was capable of evaluating the merits and risks of
his
investment. The recipient was the sole officer and director of the Registrant
at
the time of the issuance and his investment decision.
The
rights, preferences, restrictions and other matters relating to the Class A
Preferred Stock are as follows:
Section
I.Designation
and Amount.
There
is hereby authorized to be issued out of the authorized and unissued shares
of
preferred stock of the Corporation a class of preferred stock designated as
the
“Class A – Super Voting Preferred Stock” (“Class A Preferred Stock”) and the
number of shares constituting such class shall be 1,000,000.
Section
II.Voting
Rights.
Holders
of the Class A Preferred Stock shall be entitled to cast five hundred (500)
votes for each share held of the Class A Preferred Stock on all matters
presented to the stockholders of the Corporation for stockholder vote which
shall vote along with holders of the Corporation’s Common Stock on such matters.
Section
III.Redemption
Rights.
The
Class A Preferred Stock may be redeemed only by separate written agreement
by
and between the Holder and the Corporation.
Section
IV.Conversion
Rights.
The
Class A Preferred Stock is convertible, at any time or from time to time, at
the
sole option of the Holder, into shares of Common Stock on a one-for-one hundred
basis (i.e.- for every share of Class A Preferred Stock converted, the Holder
would receive one hundred (100) shares of Common Stock).
Section
V.Protective
Provisions.
So long
as any shares of Class A Preferred Stock are outstanding, this Corporation
shall
not without first obtaining the approval (by vote or written consent, as
provided by law) of the Holders of the Class A Preferred Stock which is
entitled, other than solely by law, to vote with respect to the matter, and
which Preferred Stock represents at least a majority of the voting power of
the
then outstanding shares of such Class A Preferred Stock:
(a) sell,
convey, or otherwise dispose of or encumber all or substantially all of its
property or business or merge into or consolidate with any other corporation
(other than a wholly-owned subsidiary corporation) or effect any transaction
or
series of related transactions in which more than fifty percent (50%) of the
voting power of the Corporation is disposed of;
(b) alter
or
change the rights, preferences or privileges of the shares of Class A Preferred
Stock so as to affect adversely the shares;
(c) increase
or decrease (other than by redemption or conversion) the total number of
authorized shares of preferred stock;
(d) authorize
or issue, or obligate itself to issue, any other equity security, including
any
other security convertible into or exercisable for any equity security (i)
having a preference over, or being on a parity with, the Class A Preferred
Stock
with respect to dividends or upon liquidation, or (ii) having rights similar
to
any of the rights of the Class A Preferred Stock; or
Section
VI.Other
Rights.
Except
as otherwise stated herein, there are no other rights, privileges, or
preferences attendant or relating to in any way the Class A Preferred Stock,
including by way of illustration but not limitation, those concerning dividend,
ranking, other conversion, other redemption, participation, or anti-dilution
rights or preferences.
Section
VII.Definitions.
As used
in herein, the following terms shall have the following meanings (with terms
defined in the singular having comparable meanings when used in the plural
and
vice versa), unless the context otherwise requires:
“Common
Stock” means any and all shares of the Corporation’s $0.001 par value common
stock.
“Corporation”
means Brisam Corporation, a Nevada corporation, and its successors.
“Class
A
Preferred Stock” has the meaning ascribed to it in Section I
hereof.
“Holder”
means a holder of a share or shares of Class A Preferred Stock as reflected
in
the stock books of the Corporation.
Issuer
Repurchases during the Quarter.
We
did
not repurchase any of our securities during the quarter ended June 30,2007.
Item
3.
Defaults Upon Senior Securities
None.
Item
4.
Submission of Matters to a Vote of Security Holders
We
did
not submit any matters to a vote of our security holders during the quarter
ended June 30, 2007.
Item
5.
Other Information
On
July18, 2007, we filed a Certificate of Amendment to Articles of Incorporation
with
the Nevada Secretary of State to change our corporate name from Skynet
Telematics, Inc. to Brisam Corporation. (See Schedule 14c filed with the
Commission on July 13, 2007 regarding this corporate action).
In
accordance with the requirements of the Exchange Act, the registrant caused
this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
