THE KINGSLEY COACH, INC. 10KSB
U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-KSB
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File No. 0-21733
THE KINGSLEY COACH, INC.
(Name of Small Business Issuer in its Charter)
DELAWARE 87-0369035
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
64 Old Route 522
Middleburg, PA 17842
(Address of Principal Executive Offices)
Issuer's Telephone Number: (570)837-7114
Securities Registered under Section 12(b) of the Exchange Act: None.
Securities Registered under Section 12(g) of the Exchange Act:
One Hundredth of One Mill ($0.00001) par value common voting
stock and One Tenth of One Mil ($0.0001) par value preferred stock.
Indicate by check mark whether the Registrant (1) has
filed all reports required to be filed by Sections 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 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.
(1) Yes X No (2) Yes X No
---- ---- ---- ----
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. [ ]
State Issuer's revenues for its most recent fiscal year:
December 31, 1999 - $2,810,632 -
State the aggregate market value of the common
voting stock held by non-affiliates computed by reference to
the price at which the stock was sold, or the average bid and
asked prices of such stock, as of a specified date within the
past 60 days:
December 31, 1999 - $12,080,715.94. Based on the 8,403,977
shares issued and outstanding on April 13, 2000, and the stock
price of $1.4375 per share at the close of trading on April 13,
2000. There are no shares of the Company's preferred either
issued or outstanding.
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
None; not applicable.
APPLICABLE ONLY TO CORPORATE ISSUERS Indicate the
number of shares outstanding of each of the Registrant's
classes of common stock, as of the latest practicable date:
December 31, 1999
Common Voting Stock
8,403,977
December 31, 1999
Preferred Stock
-0-
DOCUMENTS INCORPORATED BY REFERENCE
A description of "Documents Incorporated by Reference" is
contained in Item 13 of this Report.
Transitional Small Business Issuer Format Yes X No
--- ---
PART I
Item 1. Description of Business.
Business Development
- --------------------
Form and year of organization
------------------------------
For a discussion of the activities of the Company's
predecessor Micro-Hydro Power, Inc. prior to the period covered
by this Report, see the Company's Registration Statement on
Form 10-SB-A1, filed with the Securities and Exchange
Commission on March 4, 1997, its Annual Report on Form 10-KSB,
for the calendar year ended December 31, 1996, filed March
31, 1997, and its annual report for the calendar year ended
December 31, 1996, filed March 31, 1998.
Bankruptcy or similar proceedings
---------------------------------
Not applicable
Material reclassification, merger, etc.
---------------------------------------
The Company was essentially dormant for ten years until an
Agreement and Plan of Reorganization was executed on December 18,
1998, between the Company and The Kingsley Coach, LLC, a
Louisiana limited liability company, following the execution of a
Letter of Intent between the companies on November 8, 1998. The
result was the acquisition of the assets and liabilities of The
Kingsley Coach, LLC, which was formed in 1996. The equity
interest holders of The Kingsley Coach, LLC became the
controlling stockholders in a transaction viewed as a reverse
acquisition. The respective Boards of Directors of Micro-Hydro
Power and Kingsley and the respective stockholders of each entity
adopted resolutions whereby Micro-Hydro Power acquired Kingsley
assets in exchange for stock, and changed its name to The
Kingsley Coach, Inc. Details of this transaction are fully
described in Form 8-K-A2, filed January 13, 1999 with the
Securities and Exchange Commission.
The Company is traded on the OTC Bulletin Board as "KNGS.OB"
The Company is a manufacturer of custom and standard
recreational and specialized vehicles utilizing a stretched semi-
truck chassis, based upon the concept of matching the durability,
flexibility, serviceability, strength, power and safety of a
tractor cab / chassis with the convenience and comfort of an RV
body. The finished Kingsley Coach is essentially a stretched
truck chassis with an recreational vehicle motor home body unit
attached for either recreational or commercial use. The Company
has, to date, produced fifty-seven units, all different as each
unit has been custom produced to the buyer's specifications.
This customization was necessary in the development phase of the
Company's existence, as Kingsley sought to learn both what the
customer desired and what worked best in terms of stability and
safety. The Company utilized these customized orders to develop,
and then fine-tune, the various design and production
considerations of its product.
The Company commenced business in 1996, with first-year
sales of approximately $300,000. Sales increased to
approximately $825,000 in 1997, $2,046,121 in 1998, and
$2,810,632 in 1999. The Company estimates that 2000 sales will
increase substantially.
Distribution methods of the products or services
-------------------------------------------------
The typical Kingsley customer, targeted to date, has been
either: 1) an individual in the trucking industry; and 2) a
company or municipality whose specific application needs were
best satisfied by Kingsley's truck chassis design. The Company
will continue to service these customers, but the Company also
intends to begin targeting the RV buyer who wants uniqueness,
power, speed and strength combined with the interior luxury
typically available in a Class A motorhome.
The Company's marketing efforts to date have been limited to
advertising in trucking magazines and participation in trucking
trade shows. The Company intends to increase its marketing
efforts substantially as it expands its marketing focus to
include the larger RV market. This marketing expansion would
include advertising in RV magazines and participation at RV trade
shows.
Kingsley also plans to pursue a more aggressive promotional
campaign, attempting to utilize media such as, local newspapers,
local television channel and select cable channels for coverage
of certain Kingsley events, such as the planned unveiling of new
standard models, the Annual Kingsley Coach Rally, and Kingsley's
planned participation in World Land Record event. Kingsley also
would like to align itself with a spokesperson in the field of
auto racing.
There are presently several independent sales
representatives in the United States. The Company is planning to
expand its dealer and representative network.
Status of any new and existing product or service
--------------------------------------------------
The Company is presently completing designs of a set of
standard production vehicles built specifically for the RV
market, to be called the "Camelot" series. These units, while
benefitting from the Kingsley truck chassis/ RV body design, will
offer high quality motor home interiors built in standardized RV
lengths. The Company's present plans include a forty-five-foot
model built on a Class 8 truck chassis and a forty-foot model
built on a Class 7 truck chassis. The Company expects to
introduce these models in the second and third quarter of 2000.
Industry and competitive position in the industry
--------------------------------------------------
The Company considers its products to be unique at this time
as the Company is the only known manufacturer to build coaches on
an existing truck chassis. The Company considers competitive
pressures to be insignificant at this time.
Kingsley's planned "Camelot" series standardized production
RV models will compete with the "Class A Motorhome" segment, as
defined by the National Dealers Association (NADA). There were
approximately 50,000 Class A Motorhome units sold in the United
States in 1999. Kingsley's planned Camelot series entry into the
RV marketplace is designed to effectively compete with the mid-
range ($200,000 to $400,000) standard RV models. Kingsley's
marketing strategy is to promote the product's uniqueness and its
enhanced features and benefits.
Suppliers and alliances
------------------------
The Company utilizes a wide range of materials and supplies
that are provided through the automotive and recreational vehicle
industry suppliers. Kingsley uses select outside providers for
the chassis and RV body. Kingsley's RV body is manufactured in
Middleburg, Pennsylvania by Thor America ("Thor"), a division of
Thor Industries, Inc., the nation's second largest RV
manufacturer. The Company has an agreement with Thor whereby
Thor will provide the Company with shared production space in
exchange for exclusive production of the "Camelot" series units
for a three-year period. The Company began operating in the
Middleburg, Pennsylvania facility in January 1999.
Dependence on one or a few major customers
-------------------------------------------
The Company does not have any dependence on one or a few of
any major customers.
Patents, trademarks, licenses, franchises, concessions,
royalty agreements or labor contracts, including duration
----------------------------------------------------------
None.
Need for any government approval of principal products or
services
-----------------------------------------------------------
None; not applicable.
Effect of existing or probable governmental regulations on
the business
-------------------------------------------------------------
None; not applicable
Amount spent during the last two fiscal years on research
and development activities
----------------------------------------------------------
1998: $600,000.00
1999: $800,000.00
Costs and effects of compliance with environmental laws
--------------------------------------------------------
Insignificant.
Employees/contractors
----------------------
The Company has one employee, Terry Watkins, CEO. Kingsley
has a five-year contract with DRK Inc. to provide its remaining
management and production services and staff, with contract
contains performance-based incentives, including monthly fixed
base payments equal to actual cost, and incentive based payments
calculated quarterly. At Kingsley's Anoka, Minnesota location,
there are eighteen staff members, including two engineers and one
manager. At Kingsley's Middleburg, Pennsylvania location, there
are presently three staff members, including two engineers. The
Company presently to begin production at its Minnesota location
by the end of June 2000; The Company is presently recruiting a
work force at this location.
Item 2. Description of Property
- ---------------------------------
Location, condition, limitations on ownership of principal
plants and property.
-----------------------------------------------------------
Kingsley is utilizing two manufacturing facilities, one co-
located with Thor America's plant in Middleburg, Pennsylvania,
the other located in Anoka, Minnesota.
The Company has facilities that it rents at 14010 Sunfish
Lake Blvd., Anoka, Minnesota, which includes approximately 10,000
square feet of space located on 1.2 acres of land. The facility
is used for administrative offices, engineering, design, assembly
and repair.
The Company has a 2500 square foot office facility that it
rents at 64 Old Route 522, Middleburg, Pennsylvania. The Company
also has an 8,000 square foot facility co-located with Thor
America's plant at 37 Old Route 522, Middleburt, Pennsylvania.
Item 3. Legal Proceedings
- -------------------------
On March 1, 1999, a lawsuit was filed against the Company in
the Supreme Court of Maricopa County, Arizona, alleging that an
individual, on behalf of Kingsley, contracted with a consultant
to provide certain "management services" in exchange for 15,000
shares of free trading Kingsley common stock. The plaintiff
further alleges that Kingsley failed to pay the 15,000 shares of
stock and is seeking approximately $52,000 in damages, plus
attorney fees. The Company maintains that the individual had no
authority to execute on its behalf and further that "management
services" were not provided.
On December 23, 1999, the lawsuit entitled Ratliff et a. v.
The Kingsley Coach, Inc. et al. filed in Roane County, Chancery
Court and the United States District Court for the Eastern
District of Tennessee, was settled pursuant to a Settlement
Agreement between Kingsley Coach, Inc. and Russell A. Ratliff,
whereby Ratliff agreed to pay Kingsley $550,000 secured by
550,000 shares of Kingsley common stock previously issued to
Ratliff.
Item 4. Submission of Matters to a Vote of Security Holders
- ------------------------------------------------------------
A meeting of the shareholders was held on January 4, 1999 to
change the name of the Company to Kingsley Coach, Inc., and to
effect a 2-to-1 reverse split of the common stock of the Company.
Part II
Item 5. Market for Common Equity and Related Stockholder Matters
- ----------------------------------------------------------------
The Company's common stock is quoted on the National
Association of Securities Dealers Electronic Bulletin Board under
the symbol "KNGS.OB" Set forth below are the high and low bid
prices for the Company's common stock during the year 1999.
Prior to 1999 there was no market for the Company's stock in the
previous two years. The prices listed below reflect inter-dealer
prices, without retail mark-up, mark-down or commissions, and may
not represent actual transactions.
Quarter Ended High Bid Low Bid
March 31, 1999 6.00 0.00
June 30, 1999 4.00 1.63
September 30, 1999 1.75 .83
December 31, 1999 1.25 .50
There are currently 8,403,977 shares of common stock issued
and outstanding, held by 463 shareholders of the Company. There
are no preferred shares of the Company either issued or
outstanding.
The Company has not declared any cash dividends, and none are
expected to be declared in the near future.
Item 6. Management Discussion and Analysis or Plan of Operation
- ----------------------------------------------------------------
Management Discussion and Analysis or Plan of Operation for
the Year Ended December 31, 1999, including material events as
applicable
------------------------------------------------------------
The Company was essentially dormant for ten years until an
Agreement and Plan of Reorganization was executed on December 18,
1998, between the Company and The Kingsley Coach, LLC, a
Louisiana limited liability company, following the execution of a
Letter of Intent between the companies on November 8, 1998. The
result was the acquisition of the assets and liabilities of the
The Kingsley Coach, LLC.
The Company accumulated losses through December 31, 1999
amounting to $1,251,078 and has a net working capital deficiency
of $115,423 at December 31, 1999.
Management Discussion and Analysis or Plan of Operation for
the Year Ended December 31, 1999, including material events as applicable
----------------------------------------------------------------
In 1999, the Company's sales increased by approximately 39%,
from $2,046,121 to $2,810,632. In 1999, the Company's Net Loss
Before Taxes was $551,518 as compared to a Net Loss Before Taxes
in 1998 of $585,691. In 1999, the Company incurred
approximately $800,000 on research and development costs as
compared to approximately $650,000 in 1998.
The Company was still developing its product through
December 31, 1999, and the Company does not expect to be ready
for high-volume, assembly-line production of its planned standard
RV models until July 2000. As such, the Company did not, and
does not presently, anticipate profits until July 2000. When
taking into consideration the Company's development expenses
incurred in 1999 and 1998, the Company actually would have
experienced a profit in both years had these development costs
not been incurred. Since the Company had sales of only
$2,810,632 in 1999 and $2,046,121 in 1998, the Company's
profitable breakeven point is low, both in terms of dollars and
unit sales. This fact should serve the Company well in the
future, especially in the event of any economic downturns which
might adversely affect the RV industry.
Further, the Company has managed to complete full
development of its product without substantial leveraging of its
future, incurring relatively little interest-bearing debt over
its first four years of operation, approximately $1,085,000 at
December 31, 1999.
The Company expects sales to increase substantially in 1999,
reflecting the benefits of standardizing production at its
Middleburg, Pennsylvania facility and expanding its market scope
to include the RV market.
The Company recognizes that its products may be considered
luxury items, that any downturn in the economy may detrimentally
impact demand for it product. However, the Company does not
expect any decrease in sales as its expanded market efforts
should more than offset any reasonable economic downturn.
Item 7. Financial Statements and Exhibits.
- ------------------------------------------
(a) Financial Statements
The Kingsley Coach, Inc.
Independent Auditors' Report
Balance Sheet dated December 31, 1999
Statement of Operations for the years ended
December 31, 1999 and 1998
Statements of Stockholders' Deficit for the years
ended December 31, 1999 and 1998
Statements of Cash Flows for the years ended
December 31, 1999 and 1998
Notes to Financial Statements
The Kingsley Coach, Inc.
Independent Auditors' Report
and
Financial Statements
December 31, 1999
The Kingsley Coach, Inc.
TABLE OF CONTENTS
Page
Independent Auditors' Report . . . . . . . . . . . . 1
Balance Sheet - December 31, 1999 .. . . . . . . . . 2-3
Statements of Operations for the
years ended December 31, 1999 and 1998 . . . . . . . 4
Statements of Stockholders' Deficit for
the years ended December 31, 1999 and 1998 . . . . 5
Statements of Cash Flows for the
years ended December 31, 1999 and 1998 . . . . . . . 6
Notes to Financial Statements . . . . . . . . . . . 7-13
Independent Auditors' Report
The Board of Directors and Shareholders
The Kingsley Coach, Inc.
We have audited the accompanying balance sheet of The Kingsley
Coach, Inc., as of December 31, 1999, and the related statements of
operations, stockholders' deficit, and cash flows for the years
ended December 31, 1999 and 1998. These financial statements are
the responsibility of the Company's management. Our responsibility
is to express an opinion on these financial statements based on our
audit.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of The
Kingsley Coach, Inc. as of December 31, 1999, and the results of
operations and cash flows for the years ended December 31, 1999 and
1998, in conformity with generally accepted accounting principles.
/s/
Mantyla McReynolds
Salt Lake City, Utah
January 21, 2000
<TABLE>
The Kingsley Coach, Inc.
Balance Sheet
December 31, 1999
<CAPTION>
ASSETS
<S> <C>
Current Assets:
Cash $ 77,729
Accounts Receivable
(net of allowance of $5,500) 28,132
Inventory - Note 11 735,359
Settlement Receivable - Note 13 550,000
---------
Total Current Assets 1,391,220
Property & Equipment, net - Note 8 200,245
Other Assets:
Prepaid expense - Note 14 590,890
Deposits 3,650
---------
Total Other Assets 594,540
TOTAL ASSETS $2,186,005
=========
</TABLE>
See accompanying notes to financial statements
<TABLE>
The Kingsley Coach, Inc.
Balance Sheet (continued)
December 31, 1999
<CAPTION>
LIABILITIES & STOCKHOLDERS' DEFICIT
<S> <C>
Current Liabilities:
Accounts payable $ 179,204
Accrued liabilities 363,029
Payroll taxes payable 53,450
Customer deposits - Note 5 732,634
Note payable - manufacturer - Note 9 139,340
Current portion long-term debt - Note 10 38,986
---------
Total Current Liabilities 1,506,643
Long-Term Liabilities:
Note payable - other - Note 10 408,663
Note payable - shareholder - Note 4 537,846
---------
Total Long-Term Liabilities 946,509
---------
Total Liabilities 2,453,152
Stockholders' Deficit - Note 7
Preferred stock, $.0001 par value;
authorized 5,000,000 shares; issued
and outstanding -0- shares -
Common stock, $.00001 par value;
authorized 30,000,000 shares;
issued and outstanding 7,250,527 73
Additional paid-in capital 983,858
Accumulated Deficit (1,251,078)
---------
Total Stockholders' Deficit (267,147)
---------
TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIT $2,186,005
=========
</TABLE>
See accompanying notes to financial statements.
<TABLE>
The Kingsley Coach, Inc.
Statements of Operations
For the Years December 31, 1999 and 1998
<CAPTION>
<S> <C> <C>
Revenues: 1999 1998
----------- -----------
Sales $ 2,810,632 $ 2,046,121
Cost of Sales (1,919,851) (1,787,792)
--------- ---------
Gross Margin 890,781 258,329
General and administrative expenses 1,315,383 757,192
Net Loss from Operations (424,602) (498,863)
Other Income/(Expense):
Rental income -0- 29,800
Interest expense (104,190) (116,628)
Loss on disposal of assets (22,726) -0-
--------- --------
Total Other Income/(Expense) (126,916) (86,828)
--------- --------
Net Loss Before Taxes (551,518) (585,691)
Income taxes -0- -0-
Extraordinary income - Note 13 550,000 -0-
--------- --------
Net Loss $ (1,518) $(585,691)
========= ========
Loss Per Share $ (.01) $ (.16)
========= ========
Weighted Average Shares Outstanding 6,475,422 3,708,339
========= =========
</TABLE>
See accompanying notes to the financial statements.
<TABLE>
The Kingsley Coach, Inc.
Statement of Stockholders' Deficit
For the Years Ended December 31, 1999 and 1998
<CAPTION>
Add'l Accum- Total
Shares Common Paid-in ulated Stockholders'
Issued Stock Capital Deficit Deficit
<S> <C> <C> <C> <C> <C>
Balance,
December
31, 1997 7,300,010 $ 73 $163,906 $( 663,869) $( 499,890)
---------- ------ -------- ---------- ----------
Issued
stock for
services 2,800,000 28 27,972 28,000
Net Loss
for the
Year Ended
December 31,
1998 (585,691) (585,691)
---------- ------ --------- ---------- ---------
Balance,
December
31, 1998 10,100,010 101 191,878 (1,249,560) (1,057,581)
Issued
stock for
services 1,301,000 14 195,138 195,152
Issued
stock for
property 1,000,000 10 149,990 150,000
Issued
stock for
management
services
contract 2,000,000 20 378,080 378,100
Issued
stock for
services 100,000 1 68,699 68,700
Reverse
split 1:2
shares (7,250,483) (73) 73 0
Net Loss
for the
Year Ended
December 31,
1999 (1,518) (1,518)
---------- ------ ------- ---------- ----------
Balance,
December 31,
1999 7,250,527 $ 73 $983,858 $(1,251,078) $ (267,147)
========== ====== ======= ========== ==========
</TABLE>
See accompanying notes to the financial statements.
<TABLE>
The Kingsley Coach, Inc.
Statement of Cash Flows
For the Years Ended December 31, 1999 and 1998
<CAPTION>
<S> <C> <C>
1999 1998
------ ------
Cash Flows Provided by/(Used for)
Operating Activities
Net Loss $ (1,518) $ (585,691)
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 72,835 21,217
Bad debt expense 5,500 17,286
Loss on disposal of assets 22,726
Gain on legal settlement (550,000)
Issued stock for services 173,050 28,000
Decrease (increase) in prepaid exp. (164,000) 0
Decrease (increase) in
accounts receivable (10,673) 35,221
Decrease in other receivable 0 16,571
Increase in inventory 64,814 (417,255)
Increase in payroll liabilities 8,854 3,755
Increase (decrease) in
accounts payable 33,867 142,715
Increase in accrued liabilities 264,771 22,087
Increase in customer deposits 191,766 339,368
------- -------
Net Cash Provided by/(used for)
Operating Activities 111,992 (376,726)
Cash Flows Provided by/(used by)
Investing Activities
Acquisition of property and equipment (5,113) (90,568)
-------- -------
Net Cash Used for Investing
Activities (5,113) (90,568)
Cash Flows Provided by/(used for)
Financing Activities
Principal increase in notes payable 75,000 508,317
Principal payments/reductions (171,874)
Investment by shareholder 0 15,441
------- -------
Net Cash Provided by Financing
Activities (96,874) 523,758
------- -------
Net Increase/(Decrease) in Cash 10,005 56,464
Beginning Cash Balance 67,724 11,260
------ ------
Ending Cash Balance $77,729 $67,724
====== ======
Supplemental Disclosures
Interest paid $104,190 $116,628
Income taxes paid -0- -0-
Stock issued for assets 576,890 -0-
</TABLE>
See accompanying notes to the financial statements.
The Kingsley Coach, Inc.
Notes to Financial Statements
December 31, 1999
Note 1 Organization and Summary of Significant Accounting Policies
(a) Organization
The Kingsley Coach, Inc., ("Company") incorporated under the
laws of the State of Utah in 1980 as Micro-Hydro Power, Inc.
[MHP]. MHP changed its domicile from the State of Utah to
the State of Delaware by merging with and into its wholly-
owned subsidiary, Micro-Hydro Power, Inc., a Delaware
corporation in December of 1997. MHP was essentially
dormant for ten years until an Agreement and Plan of
Reorganization was executed on December 18, 1998, between
MHP and The Kingsley Coach, LLC, a Louisiana limited
liability company [Kingsley]. The result was the
acquisition of the assets and liabilities of Kingsley, also
known as a reverse acquisition, accounted for herein on the
purchase basis. Kingsley is a manufacturer of customized
luxury recreational and commercial vehicles known as The
Kingsley Coach. With the acquisition of Kingsley, MHP
changed its name to The Kingsley Coach, Inc.
The financial statements of the Company have been prepared
in accordance with generally accepted accounting principles.
The following summarizes the more significant of such
policies:
(b) Income Taxes
Effective April 1, 1993, the Company adopted the provisions
of Statement of Financial Accounting Standards No. 109 [the
Statement], "Accounting for Income Taxes." The Statement
requires an asset and liability approach for financial
accounting and reporting for income taxes, and the
recognition of deferred tax assets and liabilities for the
temporary differences between the financial reporting basis
and tax basis of the Company's assets and liabilities at
enacted tax rates expected to be in effect when such amounts
are realized or settled.
(c) Net Loss Per Common Share
Net loss per common share is based on the weighted average
number of shares outstanding.
(d) Statement of Cash Flows
For purposes of the statements of cash flows, the Company
considers cash on deposit in banks to be cash. The Company
has $77,729 cash at December 31, 1999.
(e) Use of Estimates in Preparation of Financial Statements
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 disclosure of
contingent 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.
(f) Property and Equipment
Property and equipment are stated at cost. Depreciation is
provided using the straight-line and modified accelerated
cost recovery (income tax) basis over the useful lives of
the related assets. Expenditures for maintenance and
repairs are charged to expense as incurred.
(g) Inventory
Inventory consists of parts, work-in-process, and finished
units. Inventory is valued at the lower of cost or market
using the first-in first-out (FIFO) costing method.
Note 2 LIQUIDITY
The Company has accumulated losses through December 31, 1999
amounting to $1,251,078, and has a net working capital
deficiency of $115,423 at December 31, 1999. However, in
Management's opinion, the Company expended substantial
amounts for non-recurring development costs through 1999 in
the refinement of its product and production methods. The
Company does not believe that similar costs will be
necessary in the future. Further, the Company believes
standard product design and methods will permit increased
productivity in future years. Outstanding orders with
deposits has increased from nine to fifteen from 1998 to
1999 year end. Additionally, the Company entered a
purchase agreement (see Note 16) which represents a
commitment for 50 additional orders to be produced in the
next 18 months.
To meet working capital needs, the Company has established a
$500,000 line of credit to be used in production. The
Company has issued shares of common stock for services of a
professional firm which will assist in developing and
marketing its product. Management plans also include
additional issuances of shares of common stock for
production capital; however, they do not believe such
issuance is necessary for the Company to continue operations
or to meet its current obligations.
Note 3 INCOME TAXES
The Company adopted Statement No. 109 as of April 1, 1993.
Prior years' financial statements have not been restated to
apply the provisions of Statement No. 109. No provision has
been made in the financial statements for income taxes
because the Company has accumulated substantial losses from
operations.
The tax effects of temporary differences that give rise to
significant portions of the deferred tax asset at December
31, 1999 have no impact on the financial position of the
Company. A valuation allowance is provided when it is more
likely than not that some portion of the deferred tax asset
will not be realized. Because of the lack of taxable
earnings history, the Company has established a valuation
allowance for all future deductible temporary differences.
Deferred tax assets Balance Tax Rate
Loss carryforward(expires through 2019) $369,888 $125,762 34%
Valuation allowance ($125,762)
--------
Deferred tax asset $0
========
The valuation allowance has increased $516 from $125,246 in
the prior year. Principally all operations through December
31, 1998 were attributable to a limited liability
corporation which is taxed to its members. Thus, tax
returns for those periods presented in this report have been
or will be filed accordingly.
Note 4 RELATED PARTY TRANSACTIONS/STOCKHOLDER LOANS
To pay for the original development and formation of The
Kingsley Coach, LLC, and to fund ongoing operating expenses,
a shareholder/officer has advanced funds to the Company as
evidenced by executed notes summarized as follows.
Description Principal Terms Rate of
Interest
- ----------- --------- ------------------ --------
For original development 175,000 Interest only, 10%
principal due 12/15/02
Operating advances 199,537 Interest only, 10%
principal due 12/15/02
Additional operating
advances 163,309 Interest only, 10%
------- principal due 12/15/02
Total 537,846
=======
Note 5 CUSTOMER DEPOSITS
When a customer signs a contract to have the Company
manufacture a Kingsley Coach, a deposit or down payment is
required of the customer. The amount of deposit varies
based on the terms of the contract. The Company treats
these deposits as unearned revenue until the Coach is
delivered to the customer. At December 31, 1999, deposits
had been collected on 15 Kingsleys in various stages of
completion.
Note 6 PREFERRED STOCK
The Certificate of Incorporation of Micro-Hydro Power, Inc.,
a Delaware corporation, authorizes the issuance of 5,000,000
shares of $.0001 par value preferred stock. The Board of
Directors may issue the shares in series and may designate
the powers, preferences and rights of such shares by
resolution, without the vote of stockholders. No shares are
issued and outstanding as of December 31, 1999.
Note 7 PLAN OF REORGANIZATION/ISSUANCE OF STOCK
As referenced in Note 1 the Agreement and Plan of
Reorganization set forth that Micro-Hydro Power would issue
7,000,000 shares to equity interest holders of Kingsley. At
the time of said issuance, Micro-Hydro Power had 300,010
shares outstanding and issued additional shares as follows:
(1) 300,000 pre-split shares of common stock to individuals
including directors and executive officers who have provided
non-capital raising services to the Company, pursuant to
Form S-8 filed on or about December 18, 1998 with the
Securities and Exchange Commission; (2) 100,000 "restricted
securities" for other services rendered; and (3), 2,400,000
"restricted securities" (approximately 80% of which to be
held in escrow subject to funding of the reorganized Company
through the sale of an additional 2,000,000 pre-split shares
of "restricted securities" in consideration of $2,000,000).
In January, 1999, the Company resolved to compensate its
directors and officers, on an annual basis, by issuing
50,000 "restricted" common shares. These shares would be
restricted for one year. In February, 1999, 600,000 pre-
split shares were issued to said officers and directors for
services in 1999 and 2000, valued at $0.15 per share for a
total of $90,000. Approximately $45,000 has been deferred
to be charged against 2000 earnings.
Also in January, 1999, the board authorized and directed the
Company to issue 75,000 pre-split shares of "restricted "
common stock to a related party as compensation for services
promoting public awareness of the Company. The value of
this service has been recorded at $0.15 per share or
$11,250.
In February, 1999, the Company issued 626,000 "restricted"
pre-split common shares to certain employees and affiliates
of the Company for services rendered. These shares were
valued at $.15 per share, or $93,900.
On September 17, 1999, the Company issued 100,000 tradable,
pre-split common shares to a consultant as compensation for
future services to be rendered beyond involvement in capital
raising or secondary offering activities, valued at $.687
per share or $68,700. Approximately $45,800 has been
deferred to be charged against 2000 earnings.
In November, 1999, the Company effected a reverse split of
all outstanding common shares on a 1 for 2 (1:2) basis while
retaining the stated par value of $.00001 and authorized
shares; all fractional shares being rounded up to the
nearest whole share with appropriate adjustments being made
in the additional paid-in capital and stated capital
accounts of Company.
Note 8 PROPERTY AND EQUIPMENT
The major classes of assets as of the balance sheet date are
as follows:
Accumulated Net Method/
Asset Class Cost Depreciation Book Life
----------------------------------------------------------------
Furniture $ 1,329 $ (515) $ 814 MACRS/7
Electronic Equipment 4,840 (2,517) 2,323 MACRS/5
Tools 94,293 (49,522) 44,771 MACRS/5
Leasehold Improvements 2,357 (20) 2,337 SL/39
Intangible property 150,000 -0- 150,000 Per unit
------- ------- ------- Prod.
Total $252,819 $(52,574) $200,245
======= ======= =======
Depreciation expense was $30,824, in 1999, and $21,217 in
1998.
In May of 1999, the Company acquired intellectual property
from a related party (DRK, Inc., or "DRK"), which shares
common ownership with the Company, representing 100%of the
rights to an extended sleeper cab with slide-outs, unique in
the trucking industry. The rights to the intellectual
property were purchased for 1,000,000 pre-split shares of
restricted common stock. The asset was valued at $0.15 per
share for a total of $150,000. This cost is being amortized
at $250 per unit over an estimated 600 units to be produced
in the next eight to ten years. No units were produced in
1999. The first units were produced in 2000.
Note 9 PLANT LEASE/NOTE PAYABLE
In January, 1999, the Company relocated its production
facility to Middleburg, Pennsylvania, to a plant that is
shared by a subcontractor who participates in the
production of Kingsley Coaches. The Company entered into an
agreement for a period of three years with annual rent
charges of $1 plus a prorated share of common expenses such
as taxes and insurance. Prior to relocation, the Company
leased a facility in Houston, Texas, on a month-to-month
basis. The Company is leasing additional office/operating
space, in Middleburg, on a month-to-month basis for
approximately $3,357 per month. Total rent paid for the
periods ended December 31, 1999 and 1998 were $43,144 and
$30,167.
In connection with the plant lease, the Company accepted a
loan for $200,000 from the subcontractor and granted it
exclusive recreational vehicle manufacturing rights for the
agreement period (effective September 10, 1998 for three
years). Repayment of the loan is based on a $5,000 per body
charge to be billed as units are built for Kingsley. In
1999, an additional $75,000 was loaned to the Company.
However, the loan balance has been reduced to $165,000 as of
December 31, 1999 due to production activity. In the event
that the loan is not repaid through the per-body charge, it
is payable on demand. The loan is non-interest bearing.
Note 10 NOTE PAYABLE/RENTAL INCOME
A relative of an officer of the Company has purchased
several Kingsley Coaches. In 1998, he sold two back to the
Company in exchange for a note. The note, dated May 1,
1998, bears interest at 9% and has a monthly payment of
$6,474. The original amount of the note is $502,000. The
Company repaid approximately $22,477 during 1998 and $36,214
during 1999. The two Kingsley Coaches are still owned by
the Company as of December 31, 1999, and through the date of
this report. One Kingsley was rented for a period of time
to an individual/customer on a month-to-month basis during
1998 and is now being used as a demonstrator model. Total
rents received during 1998 were $29,800. The other Kingsley
is on display as a demo-unit for the Company until it is
sold.
Scheduled maturities of long-term debt are as follows:
Year Ending October 31: Amount
---------------------- ------
2000 $ 38,983
2001 42,635
2002 46,639
2003 51,014
2004 and thereafter 268,378
-------
$ 447,649
========
Note 11 INVENTORY
As of December 31, 1999, inventory consists of parts, work-
in-process, and finished units. Most parts are purchased
and charged to the job. However, other items are purchased
in bulk and can be used on all Kingsleys. As of December
31, 1999, cost approximates market value and no adjustment
has been recorded. Work-in-process inventory consists of
several Kingsley Coaches at various stages of production.
Total inventory as of December 31, 1999 is as follows:
Parts inventory $ 29,895
Work-in-process 203,464
Finished Units/Demos 502,000
-------
$735,359
=======
Note 12 LEGAL CONTINGENCIES
The Company is involved in various claims and legal actions
arising in the ordinary course of business. In the opinion
of management and legal counsel, the ultimate disposition of
these matters will not have a material adverse effect on the
Company's financial position.
On March 1, 1999, a lawsuit was filed against the Company in
the Supreme Court of Maricopa County, Arizona, alleging
that an individual, on behalf of Kingsley, contracted with a
consultant to provide certain "management services" in
exchange for 15,000 shares of free trading Kingsley common
stock. The plaintiff further alleges that Kingsley failed
to pay the 15,000 shares of stock, and is seeking
approximately $52,000 in damages, plus attorney fees. The
Company maintains that the individual had no authority to
execute on its behalf and further that "management services"
were not provided.
Note 13 LEGAL SETTLEMENT RECEIVABLE
On August 16, 1999, the Company was served with a lawsuit
alleging that consultants (Plaintiffs) located investors and
investment opportunities for the Company, but that the
Company did not cooperate in finalizing these investments,
and as a result, the Plaintiffs were injured and could not
receive common stock of the Company being held in escrow for
their benefit (see Note 7). The Company counterclaimed
against the Plaintiff, and subsequently reached a settlement
of all related claims and causes. The terms of the
settlement provided that The Kingsley Coach, Inc., would
receive $550,000, payable from the proceeds of the sale of
stock which had been placed in escrow in the previous
agreement. 550,000 post-split shares of Kingsley stock were
placed with an escrow agent designated by the Company.
Plaintiffs were to execute an irrevocable stock power
allowing said escrow agent to sell the stock as directed by
Plaintiffs, provided that any sale should be at a price not
less than $1.00 per share; the first $1.00 per share of
sales proceeds to be remitted to the Company and any excess
over $1.00 to be remitted to Plaintiffs. The Company was to
be responsible for payment of escrow fees and costs. Any
unsold shares in escrow, after 90 days from the settlement
date, should revert to The Kingsley Coach, Inc. In February
and March, 2000, the Company collected $503,750 from the
sale of these shares. On February 29, 2000, 50,000 shares
were transferred to a securities company for services. The
Company considers the settlement receivable satisfied for
the full $550,000.
Note 14 PREPAID EXPENSES/MANAGEMENT SERVICES CONTRACT
Prepaid expenses as of December 31, 1999, consist of
the following:
Prepaid outside professional fees - Notes 7 & 15 $ 204,800
Management services retainer (see below) 336,090
Prepaid officer and director fees - Note 7 45,000
Other expenses 5,000
-------
Total $590,890
=======
In May of 1999, the Company entered into a management
services agreement with DRK, which is a group of individuals
who have been directly involved in the research,
development, design, engineering, sales and manufacture of
Kingsley Coaches since inception. The six-year contract
(which is based on five years of production) provides for
management and production services with performance-based
incentives, including monthly fixed base payments equal to
actual cost, and incentive-based payments calculated
quarterly. The Company issued 2,000,000 pre-split shares of
restricted common stock for partial payment of this
agreement. This agreement is significant and could effect a
change in control of The Kingsley Coach, Inc. Total monthly
fixed base payments for 1999 were approximately $343,000.
All performance-based incentives were waived for 1999. The
value of the issued shares was calculated at a discounted
price of approximately $0.19 per share or $378,102.
The management agreement allows for half of the 2,000,000
(or 1,000,000) pre-split common shares to revert back to the
treasury of the Company if performance goals are not met
over the five year period beginning January 1, 2000. To
allocate the cost of the management service over the
contract period, the Company will amortize the expense on a
straight line basis at approximately $5,251 per month.
Amortization for 1999 was $42,011.
Note 15 PROFESSIONAL SERVICES LIABILITY/SUBSEQUENT EVENT
On December 13, 1999, the Company resolved to compensate six
professionals with common stock in lieu of cash. As of
December 31, 1999, a liability was accrued for $318,000 as
the amount of which the value would not exceed.
Approximately half of the services were provided in 1999 and
the balance is to be provided in 2000. On January 6, 2000,
the Company filed a Form S-8 statement under the Securities
Act of 1933 to register 955,000 shares of common stock which
were issued in satisfaction of this liability.
Note 16 PURCHASE AGREEMENT/SUBSEQUENT EVENT
On December 28, 1999, the Company signed a purchase
agreement with a trucking company which essentially provides
that for a deposit of $300,000, ($6,000 for 50 units) the
Company will reserve the next order slots for production of
Kinglsey Coaches over the next eighteen (18) months. The
$300,000 was collected in January of 2000. The agreement is
automatically renewable by mutual consent.
Note 17 LINE OF CREDIT
The Company entered into an Agreement for Wholesale
Financing on November 1, 1999, with a financial services
corporation. The terms allow the Company up to $500,000 of
credit, to purchase inventory from approved vendors and "for
other purposes." Advances are secured by the inventory
and/or components financed. Further, an individual, who is
also a shareholder of the Company, has signed a personal
guaranty to the Agreement Terms for credit are not set
forth in the Agreement but are determined with each advance
and depend, in part, on availability of vendor discounts,
payment terms or other incentives, prevailing economic
conditions or other such factors which may vary from time to
time. During 1999 the Company received approximately four
advances totaling $149,132 with interest at approximately
8.875%, which they repaid. The balance due on the Agreement
as of December 31, 1999 was $109.
Item 8. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.
None; Not Applicable.
PART III
Item 9. Directors, Executive Officers, Promoters and Control
Persons; Compliance with Section 16(a) of the Exchange Act.
- ---------------------------------------------------------------
Identification of Directors and Executive Officers
--------------------------------------------------
The following table sets forth, in alphabetical order,
the names and the nature of all positions and offices held by all
directors and executive officers of the Company for the Company
year ending December 31, 1999, and the period or periods
during which each such director or executive officer served in
his or her respective positions.
Management
Names Title or Position Age
Terry Watkins CEO 49
Ralph Dickenson CEO, Chairman and President 60
Verdo Lancaster Vice President and Director 60
Richard Duston Sec/Tres and Director 50
Catherine Rimes Director 38
James Whitehead Director 57
Officers and Directors
Ralph Dickenson. Mr. Dickenson is the Chairman and
co-founder of the Kinglsey Coach line of vehicles. With over 30
years in the transportation industry, Mr. Dickenson has been
involved in the transit bus, charter bus, school bus industry as
well as transit bus re-manufacturing, sales and service of all
types of buses and trucks.
Terry Watkins. Mr. Watkins is the Chief Executive Officer.
Mr. Watkins graduated from Purdue University in 1974 with a BA in
English Literature. He also earned Masters Degrees from
University of Texas (Creative Writing) and from Bowling Green
State University (Accountancy). He spent three years in US Army
and another four years teaching English and Accounting at two
major universities. His career in the transportation industry
began fifteen years ago and includes employment in various
financial and operational capacities with such companies as US
Transportation Systems, Tem-Cole Systems and Greater Southwest
Transport Company. He also has an extensive background in
agriculture, acting as the General Manager of the country's
largest red radish producer. Mr. Watkins joined Kingsley as CEO
on March 1, 2000.
Verdo Lancaster. Mr. Lancaster is Vice President of Sales
and a director. Mr. Lancaster has many years of experience in
the mobile home industry and has owned recreational vehicles over
the last 30 years.
Richard Duston, Director. Mr. Duston currently works for
Waters Truck & Tractor Co., Inc. as a comptroller. Waters Truck
& Tractor is the 2nd largest Navistar dealer in the southeast
U.S. and is a 60 year old family-owned company. BS Degree from
Mississippi State University in accounting in 1975. MPA Degree
from Mississippi State University in 1976 and a Graduate Degree
from the School of Banking of the South in 1985.
Catherine Rimes, Director. Ms. Rimes is the daughter of
Ralph Dickenson and basically grew up in the transportation
industry working with and learning from her father. She came up
through the ranks working as a bus cleaner and general office
assistant to eventually being put in charge of special projects
and ultimately asked to serve as the President of several
divisions. Her responsibilities include customer relations,
contract negotiations, lease fleet management, personnel,
marketing and advertising.
James Whitehead, Director. Mr. Whitehead is currently CEO
of Whitehead Brothers, a nationwide freight trucking company with
fifty trucks and 62 employees. He is also co-owner of Lake City
Logistics in Eufaula, Alabama.
Significant employees
----------------------
None
Family relationships
---------------------
Catherine Rimes is the daughter of Ralph Dickenson
Officer/Director bankruptcies, criminal convictions orders or
violations re: securities, business or banking laws
-----------------------------------------------------------
None
Compliance with Section 16(a) of the Securities Exchange Act
of 1934
-----------------------------------------------------------
The following reports were not filed by officer, directors or
10% shareholder during 1999:
DRK: Form 3, due 2/21/99
Form 4, due 6/7/99
Form 4, due 1/9/00
Form 5, due 2/14/00
Catherine Rimes: Form 3, due 2/21/99
Form 4, due 6/7/99
Form 4, due 1/9/00
Form 5, due 2/14/00
George Carlson: Form 3, due 2/21/99
Form 4, due 6/7/99
Form 4, due 1/9/00
Form 5, due 2/14/00
Richard Duston: Form 3, due 2/27/99
Form 4, due 1/9/00
Form 5, due 2/14/00
Verdo Lancaster: Form 3, due 7/29/99
Form 4, due 1/9/00
Form 5, due 2/14/00
Item 10. Executive Compensation
- --------------------------------
No compensation was paid to any officer or director in 1999
other than the issuance to each director of 100,000 shares of
Kingsley common stock, which was to pay for director services for
1999 and 2000.
Mr. Watkins' compensation in 2000 has been established at
$100,000 per year plus common stock issuance of up to 100,000
shares, dependent upon certain performance criteria of the
Company.
No other information is applicable to the Company under Item
10 of this disclosure.
Item 11. Security Ownership of Certain Beneficial Owners and
Management
- ---------------------------------------------------------------
The following table sets forth the shareholdings of those
persons who own more than five percent of the Company's common
stock as of the date hereof:
<TABLE>
<CAPTION>
Number and Percentage*
of Shares Beneficially Owned
----------------------------
Name and Address # of Shares % of Class
- ---------------- -------------------- ---------
<S> <C> <C>
Verdo Lancaster 1,581,250 18.82%
33236 Walker N. Rd
Walker, LA 70785
Richard Duston 367,490 4.37%
904 College St.
Columbus, MS 39701
DRK, Inc.*
14010 Sunfish Lake Blvd 2,501,385 29.76%
Anoka, MN 55303
Cede & Co. 1,385,359 16.48%
Depository Trust Co.
55 Water St. 2SL
New York, NY 10041
*owned by Catherine Rimes (50%) and George Carlson (50%)
</TABLE>
The following table sets forth the shareholdings of those
persons who are officers and directors of the Company as of the
date hereof:
<TABLE>
<CAPTION>
Number and Percentage*
of Shares Beneficially Owned
----------------------------
Name and Address # of Shares % of Class
- ---------------- -------------------- ---------
<S> <C> <C>
Ralph Dickenson 0 0%
14010 Sunfish Lake Blvd
Anoka, MN 55303
Terry Watkins 0 0%
64 Old Route 522
Middleburg, PA 17842
George Carlson 92,500 directly 1.10%
5091 143rd Ave. 1,250,693 beneficially* 14.88%
Ramsey, MN 55303
Verdo Lancaster 1,581,250 18.82%
33236 Walker N. Rd
Walker, LA 70785
Richard Duston 367,490 4.37%
904 College St.
Columbus, MS 39701
James Whitehead 33,995 .40%
14010 Sunfish Lake Blvd
Anoka, MN 55303
Catherine Rimes 1,000 directly .01%
1828 Halloway Road 1,250,693 beneficially* 14.88%
Lebanon, TN 37090
*Catherine Rimes and George Carlson each have a 50% interest in
DRK, Inc.
</TABLE>
Arrangements that may result in loss of control of Company
-----------------------------------------------------------
None; not applicable
Item 12. Certain Relationships and Related Transactions.
- -------------------------------------------------------
With directors or executive officers
------------------------------------------
In 1999, Directors were issued 100,000 restricted shares of
common stock as compensation for director services for 1999 and
2000. Directors were not involved in any material transactions
with the Company, other than the Company's agreement to pay for
Ralph Dickenson's costs to relocate to Pennsylvania.
In 1999, Kingsley entered into a five-year contract with DRK
Inc. to provide its remaining management and production services
and staff, with contract contains performance-based incentives,
including monthly fixed base payments equal to actual cost, and
incentive based payments calculated quarterly. Catherine Rimes
and George Carlson each control 50% of DRK, Inc.
With nominees
--------------
None
With security holders named in response to Item 11
-----------------------------------------------------
Verdo Lancaster is a holder of notes in the amount of
$537,846 due to him from the Company
With immediate family members
-----------------------------
Wilbur Rimes, husband of Catherine Rimes, is owed $408,663 by
the Company
Transactions with promoters
----------------------------------------------
Pursuant to a Settlement Agreement between Kingsley Coach,
Inc. and Russell A. Ratliff, dated December 23, 1999, Ratliff
agreed to pay Kingsley $550,000 secured by 550,000 shares of
Kingsley common stock previously issued to Ratliff.
Item 13. Exhibits and Reports on Form 8-K.
- ------------------------------------------
Reports on Form 8-K
-------------------
An 8-K/A2 was filed on 1/12/99, disclosing the Agreement and
Plan of Reorganization signed between the parties on 12/18/98,
and a meeting of the shareholders set for January 4, 1999 to
change the name of the Company to Kingsley Coach, Inc., and to
effect a 2-to-1 reverse split of the common stock of the Company.
An 8-K/A3 was filed on 3/3/99, disclosing the auditor's
report for the Company for the year ended December 31, 1998.
Exhibits*
- --------
Where Incorporated in this Report
- ------------------------------
Exhibit Number Description
- -------------- -----------
Ex-27 Financial Date Schedule.
* Summaries of all exhibits contained within this Report
are modified in their entirety by reference to these Exhibits.
** These documents and related exhibits have been
previously filed with the Securities and Exchange Commission and
are incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly
caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
KINGSLEY COACH, INC.
Date: By/S/4-19-00 By/S/Terry Watkins
CEO
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, this Report has been signed below by the
following persons on behalf of the Registrant and in the
capacities and on the dates indicated:
KINGSLEY COACH, INC.
Date: By/S/4-19-00 By/S/Terry Watkins
CEO
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> DEC-31-1999
<CASH> 77,729
<SECURITIES> 0
<RECEIVABLES> 28,132
<ALLOWANCES> 0
<INVENTORY> 735,359
<CURRENT-ASSETS> 1,391,220
<PP&E> 200,245
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,186,005
<CURRENT-LIABILITIES> 1,506,643
<BONDS> 0
0
0
<COMMON> 73
<OTHER-SE> (267,220)
<TOTAL-LIABILITY-AND-EQUITY> 2,186,005
<SALES> 2,810,632
<TOTAL-REVENUES> 2,810,632
<CGS> 1,919,851
<TOTAL-COSTS> 1,315,383
<OTHER-EXPENSES> 524,274
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 104,190
<INCOME-PRETAX> (1,518)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,518)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,518)
<EPS-BASIC> (.01)
<EPS-DILUTED> (.01)
</TABLE>
