UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-------------------
FORM 10-K
ANNUAL REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
DATE OF REPORT: July 31, 2000
RIGID AIRSHIP USA, INC.
--------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Nevada 88-0410474
--------------------------------- ---------------------- ------------------
(STATE OR OTHER JURISDICTION NO.) COMMISSION FILE NUMBER) IRS EMPLOYER I.D.)
130 87th Street
Stone Harbor, NJ 08247
Telephone Number (609) 368-1106
Fax Number (609) 368-6446
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(ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES)
1800 East Sahara Avenue
Suite # 107
Las Vegas, Nevada 89104
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(FORMER NAME OR FORMER ADDRESS, OF CHANGE SINCE LAST ADDRESS)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on Which Registered
(NONE)
------------------------------ -----------------------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 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. [X] Yes [ ] No
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of regulation S-K (&229.405 of this chapter) is not contained herein, and
will not 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-K or any amendment to this Form 10-K. [X] (AMENDED BY EXCHANGE ACT REL
NO 28869, UTIL ACT REL NO 25254, INV CO ACT REL NO 17791, EFF 5/1/91.)
The aggregate market value of the voting stock held by non-affiliates of
the registrant as of 12/31/99 was $653,030 based on existence of 2,968,316
shares non-affiliated with $0.22 average price per share.
The number of shares of the registrant's common stock $.001 par value
outstanding as of December 31, 1999 was 28,968,316.
1
<PAGE>
PART I
Item 1. BUSINESS
The Company intends to construct and have certified, then market, manufacture,
and operate 180-meter rigid airships in the US. Based upon design specifications
of Rigid Airship Design N.V. in The Netherlands, rigid airships to be
constructed by Rigid Airship USA will be intended principally for use as air
cruising ships. The size and configuration of subsequent airships to be built in
the US will be in response to market demand and certification specifications as
developed by the FAA.
On November 9, 1998, Rigid Airship Holdings NV, a Curacao Corporation, acquired
26,000,000 shares of common stock and 20,000,000 of preferred stock of the
company. The common shares acquired represented approximately (89.89) % of the
total outstanding common stock and 100% of the preferred shares of the
registrant, and effectively constituted a majority stockholding position.
The Company changed from previous its business operations, majority ownership,
and name on November 10,1998. Rigid Airship USA is in the business of operating,
marketing, and manufacturing classic Rigid Airships. Designed to operate in the
lower altitude below 12,000 feet, which is nearly free of commercial air
traffic, the first Rigid Airships will convey 100-200 passengers. Cruising at
approximately 75 miles per hour, the Rigid Airship employs six engines which
power large, slowly-turning propellers, producing a small fraction of the noise
level common to conventional commercial aircraft. Distinctly different from
pressurized airships known as blimps, the Rigid Airship's rigid structure
provides hull space for the comforts associated with ocean cruise ships.
Employing some of the technology and design of the famous Zeppelins which began
the world's first airline in 1919, the Rigid Airship will exploit modern
improvements in engines, fabrics, electronics, aluminum, modern day radar, and
avionics. Employing fire retardant helium as a lifting gas, the Rigid Airship
will provide spacious, comfortable, hotel-like amenities to passengers enjoying
smooth, quiet cruising. With elegant dining, lounging, and entertainment
centers, the airships provide incomparable panoramic enjoyment through large
viewing windows.
Item 2. PROPERTIES
None
Item 3. LEGAL PROCEEDINGS
None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On September 9, 1999, Director and the majority shareholder took shareholders
action without a meeting of shareholders to rescind 1,800,000 restricted shares
previously issued for services subsequently not performed. The Company then
issued 1,800,000 shares to Atlas Free Enterprise Corporation to assume $463,643
in accounts payable liabilities, removing the liabilities from the Company's
balance sheet on September 9, 1999.
See Item 7. MANAGEMENTS DISCUSSION OF ANALYSIS OF FINANCIAL DATA
PART II
Item 5. MARKET FOR COMMON SHARES
Symbol RAIR OTC: Bulletin Board
As of 12/31/99:
28,968,316 shares outstanding of which 366,319 were free-trading. 1,908
shareholders.
2
<PAGE>
Item 6. SELECTED FINANCIAL DATA
RIGID AIRSHIP USA, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
DECEMBER 31, 1999
3
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To The Board of Directors
Rigid Airship USA, Inc.
Stone Harbor, New Jersey
We have audited the accompanying balance sheet of Rigid Airship USA, Inc. (a
development stage company) as of December 31, 1999 and the statements of
operations, stockholders' equity, and cash flows for the year ended December 31,
1999. 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. The financial statements of Rigid Airship USA,
Inc. as of December 31, 1998 were audited by other auditors whose report was
dated May 8, 1999, on those statements included an explanatory paragraph that
described the company's ability to continue as a going concern discussed in Note
5 to the financial statements.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit 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 1999 financial statements referred to above present fairly,
in all material respects, the financial position of Rigid Airship USA, Inc. as
of December 31, 1999, and the results of its operations and its cash flows for
the year ended December 31, 1999 in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 5 to the
financial statements, the Company does not have the working capital necessary to
pay its debts and for any future planned activity. Those conditions raise
substantial doubt about its ability to continue as a going concern. Management's
plans regarding those matters are also described in Note 5. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
Abington, Pennsylvania
July 11, 2000 Certified Public Accountants
4
<PAGE>
<TABLE>
<CAPTION>
RIGID AIRSHIP USA, INC.
(A Development Stage Company)
Balance Sheets
December 31, 1999 and 1998
1999 1998
----------- -----------
ASSETS
<S> <C> <C>
Current assets
Cash $ -- $ --
----------- -----------
Total current assets -- --
----------- -----------
Other assets
Airship license (Note 3) -- --
----------- -----------
Total assets $ -- $ --
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Current liabilities
Accounts payable $ -- $ 465,643
Due to shareholder 29,109 --
----------- -----------
Total current liabilities 29,109 465,643
----------- -----------
Stockholders' equity
Preferred stock $.001 par value; 20,100,000 voting shares
authorized, 20,000,012 shares issued and outstanding 20,000 20,000
Common stock $.001 par value; 50,000,000 authorized,
28,964,316 shares issued and outstanding 28,964 28,964
Capital in excess of par value 4,350,193 3,884,550
Deficit accumulated during the development stage (4,428,266) (4,399,157)
----------- -----------
Total stockholders' equity (29,109) (465,643)
----------- -----------
Total liabilities and stockholders' equity $ -- $ --
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
<TABLE>
<CAPTION>
RIGID AIRSHIP USA, INC.
(A Development Stage Company)
Statements of Operations
For the years ended December 31, 1999, 1998 and 1997
and the Period September 22, 1983 (date of inception) to December 31, 1999
September 23,
1983 (Date of
Inception) to
December 31, December 31, December 31, December 31,
1999 1998 1997 1999
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Revenues $ -- $ 3,411 $ 56,300 $ 132,986
Expenses 29,109 514,868 221,662 2,836,190
------------- ------------- ------------- -------------
Net loss - operations (29,109) (511,457) (165,362) (2,703,204)
Other losses
Provision for reduction in value of assets
and losses on sale of assets -- (683,330) (730,907) (1,725,062)
------------- ------------- ------------- -------------
Net loss $ (29,109) $ (1,194,787) $ (896,269) $ (4,428,266)
============= ============= ============= =============
Net loss per common share
Basic $ 0.00 $ (0.53) $ (7.24)
============= ============= =============
Average shares outstanding
Basic 28,964,316 2,235,174 123,876
============= ============= =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
<TABLE>
<CAPTION>
RIGID AIRSHIP USA, INC.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
For the years ended December 31, 1999, 1998 and 1997
Common Stock Preferred Stock Capital in
----------------- --------------- excess of Accumlated
Shares Amount Shares Amount par value Deficit Total
------ ------ ------ ------ --------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balances - December 31, 1996 73,343 $ 74 12 $ -- $ 3,142,658 $(2,308,101) $ 834,631
Issuance of common shares for
advertising - February 1997 73 -- -- -- 4,350 -- 4,350
Issuance of common shares for
cash - March 1997 417 -- -- -- 10,000 -- 10,000
Issuance of common shares for
services - April 1997 43 -- -- -- 26,000 -- 26,000
Issuance of common shares for real
property - Plaquemine, LA - August 1997 64,917 65 -- -- 7,725 -- 7,790
Issuance of common shares for
services - December 1997 8,333 8 -- -- 242 -- 250
Additional value of common shares
issued for Itex Trade Credits -- -- -- -- 57,604 -- 57,604
Net operating loss for the year ended
December 31, 1997 -- -- -- -- -- (896,269) (896,269)
------- ------ ----- ---- ---------- ----------- -----------
Balance December 31, 1997 147,126 $ 147 12 -- $3,248,579 $(3,204,370) $ 44,356
Issuance of common shares for
expenses - January and April - 1998 48 -- -- -- 72 -- 72
Issuance of common shares for
services at $1.50 - May and August - 1998 34,334 34 -- -- 51,466 -- 51,500
Issuance of common shares for shares
of Col North Rail - January and August -
1998 at $1.50 20,000 20 -- -- 29,990 -- 30,010
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
<TABLE>
<CAPTION>
RIGID AIRSHIP USA, INC.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
For the years ended December 31, 1999, 1998 and 1997
----------------------------------------------------
Common Stock Preferred Stock Capital in
----------------- ------------------ excess of Accumlated
Shares Amount Shares Amount par value Deficit Total
------ ------ ------ ------ ----------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Issuance of common shares for services and
expenses at $1.50 Oct. and Nov. 1998 148,501 $ 149 -- $ -- $ 222,602 $ -- $ 222,751
Issuance of common stock for cash at $4.00
- Nov. 1998 (under Reg D exemption) 50,00 50 -- -- 199,950 -- 200,000
Issuance of common shares for services at
$.02 - Dec. 1998 2,413,250 2,413 -- -- 45,852 -- 48,265
Issuance of common shares for purchase of
airship license - Dec. 1998 - Note 3 26,000,000 26,000 -- -- (26,000) -- --
Issuance of preferred shares for purchase of
airship license - Dec. 1998 - Note 3 -- -- 20,000,000 20,000 (20,000) -- --
Issuance of common shares for services at
$.20 - 1998 150,000 150 -- -- 29,850 -- 30,000
Issuance of common shares resulting from
reverse stock split - 1998 1,057 1 -- -- (1) -- --
Additional value of common shares issued
for Itex Trade Credits -- -- -- -- 102,190 -- 102,190
Net operating loss for the year ended
December 31, 1998 -- -- -- -- -- (1,194,787) (1,194,787)
---------- ------- ---------- -------- ----------- ----------- ----------
Balance December 31, 1998 28,964,316 $28,964 20,000,012 $ 20,000 $ 3,884,550 $(4,399,157) $ (465,643)
</TABLE>
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
<TABLE>
<CAPTION>
RIGID AIRSHIP USA, INC.
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
Common Stock Preferred Stock Capital in
---------------------- ----------------------- excess of Accumlated
Shares Amount Shares Amount par value Deficit Total
---------- ---------- ----------- ---------- ----------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Rescinding and re-issuance of common
shares for assumption of liabilities - $ - - $ - $ 465,643 $ - $ 465,643
Net operating loss for the year
ended December 31, 1999 - - - - - ( 29,109) (29,109)
---------- ---------- ---------- ---------- ---------- ----------- ---------
BALANCE DECEMBER 31, 1999 28,964,316 $ 28,964 20,000,012 $ 20,000 $4,350,193 $(4,428,266) $ (29,109)
========== ========== ========== ========== ========== =========== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
<TABLE>
<CAPTION>
RIGID AIRSHIP USA, INC.
(A Development Stage Company)
Statements of Cash Flows
For the Years Ended December 31, 1999, 1998, and 1997
And for the Period September 22, 1983 (date of inception) to December 31, 1999
September 23,
1983 (Date of
Inception) to
1999 1998 1997 December 31, 1999
----------- ----------- ----------- -----------------
<S> <C> <C> <C> <C>
Cash flows from operating activities
Net loss $ (29,109) $(1,194,787) $ (896,269) $(4,428,266)
Adjustments to reconcile net loss
to net cash provided by (used in):
operating activities:
Bad debts -- 5,134 5,700 --
Depreciation and amortization -- -- 950 --
Provision for reduction in value of
assets and losses on sale of assets -- 683,330 730,907 1,725,062
Changes in assets and liabilities:
(Increase) decrease
Accounts receivable -- -- (1,434) --
Increase (decrease)
Accounts payable -- 11,440 26,512 --
Due to shareholder 29,109 29,109
Capital stock issued for expenses
and services -- 294,780 115,019 1,968,233
----------- ----------- ----------- -----------
Net cash used in operating activities -- (200,103) (18,615) (705,862
----------- ----------- ----------- -----------
Cash flows from investing activities
Purchase of securities -- -- (16,548) --
Purchase of real property and leases -- -- (72,727) --
----------- ----------- ----------- -----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
<TABLE>
<CAPTION>
RIGID AIRSHIP USA, INC.
(A Development Stage Company)
Statement of Cash Flows (Continued)
For the Years Ended December 31, 1999, 1998, 1997
And for the Period September 22, 1983 (date of inception) to December 31, 1999
September 23,
1983 (date of
inception) to
1999 1998 1997 December 31, 1999
-------- --------- --------- -----------------
<S> <C> <C> <C> <C>
Net cash used in investing activities -- -- (89,275) --
Cash flows from financing activities
Net change in notes payable -- -- 94,576 --
Proceeds from issuance of common stock -- 200,000 10,000 705,862
-------- --------- --------- ---------
Net cash provided by financing activities -- 200,000 104,576 705,862
-------- --------- --------- ---------
Net decrease in cash -- (103) (3,314) --
-------- --------- --------- ---------
Cash - beginning of period -- 103 3,417 --
-------- --------- --------- ---------
Cash - end of period $ -- $ -- $ 103 $ --
======== ========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
11
<PAGE>
<TABLE>
<CAPTION>
RIGID AIRSHIP USA, INC.
(A Development Stage Company)
Statements of Cash Flows
For the Years Ended December 31, 1999, 1998, and 1997
And for the Period September 22, 1983 (Date of Inception) to December 31, 1999
Schedule of Non-Cash Operating, Investing and Financing Activities
Stated in Post Split Shares
<S> <C>
Issuance of 9 common shares for shares in Fruitee, Inc. - 1984 $ 8,400
Issuance of 13 common shares for payment of debt - 1986 110,500
Issuance of 12 common shares for mining claims - 1988 169,920
Issuance of 23 preferred shares for payment of debt - 1988 54,929
Issuance of 59 common shares for rights for magnetic device - 1989 53,000
Issuance of 124 common shares for services and expenses - 1990 111,900
Issuance of 100 common shares for assets, payment of debt, service & expenses - 1991 99,000
Issuance of 5 common shares for assets, payment of debt, and services - 1992 10,500
Issuance of 360 common shares for services - 1994 3,244
Issuance of 167 common shares for services - 1995 1,500
Issuance of 986 common shares for assets, services and expenses - 1995 475,835
Issuance of 22 common shares for services - 1996 21,200
Issuance of 167 common shares for prepaid telephone time 20,000
Issuance of 423 common shares for services - 1996 405,601
Issuance of 1,322 common shares for coal leases - Sheridan County, Wyoming - 1996 16,520
Issuance of 2,500 common shares for 24,000 preferred shares - 1996 106,500
Issuance of 167 common shares for services - 1996 75,000
Issuance of 417 common shares for Itex Trade credits - 1996 200,225
Issuance of 46,666 common shares for real property - Dickinson, TX - 1996 180,000
Issuance of 41 common shares for services - 1996 22,000
Issuance of 1,994 common shares for equity in real property - Louisiana -1996 660,912
Issuance of 73 common shares for advertising - 1997 4,350
Issuance of 43 common shares for services - 1997 26,000
Issuance of 64,917 common shares for real property - Plaquermine, PA - 1997 7,790
Issuance of 8,333 common shares services - 1997 250
Issuance of 48 common shares for expenses - 1998 72
Issuance of 34,334 common shares for services - 1998 51,500
Issuance of 20,000 common shares in Col North Rail - 1998 30,010
Issuance of 148,501 common shares for services and expenses - 1998 222,751
Issuance of 2,413,250 common shares for services - 1998 48,265
Issuance of 26,000,000 common shares for airship license - 1998 -
Issuance of 26,000,000 preferred shares for airship license - 1998 -
Issuance of 150,000 common shares for services - 1998 30,000
Issuance of 4,000 common shares for services - 1999 -
Rescinding of 1,800,000 common shares for failure to perform services - 1999 ( 1,800)
Issuance of 1,800,000 common shares for assumption of liabilities - 1999 465,643
</TABLE>
The accompanying notes are an integral part of these financial statements.
12
<PAGE>
RIGID AIRSHIP USA, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
1. ORGANIZATION
The Company was incorporated on September 22, 1983 under the laws of the
state of Utah with authorized common capital stock of 50,000,000 shares
of $0.001 par value with the name of Charter Resources, Inc. On April 7,
1988 the articles of incorporation were amended to authorize 20,000,000
shares of non-voting, non-convertible, cumulative preferred stock at
$0.001 par value. During 1988 the cumulative provision on the preferred
stock was deleted and the non voting was changed to voting and during
1999 the authorized was increased to 20,100,000 shares.
On January 13, 1995 the company changed its domicile to the state of
Nevada in connection with a name change to CTRI, Inc. On April 20, 1995
the name was changed to Synfuel Technology, Inc. and on November 9, 1998
the name was changed to Rigid Airship USA, Inc.
Since inception the Company completed five reverse stock splits of its
common capital stock and its preferred capital stock. This report has
been prepared showing after stock split shares from inception.
Since inception the Company has been in the development stage and has
been engaged in seeking business opportunities. During 1998 the Company
transferred all of its remaining assets (Note 6) and during 1999,
disposed of most of its liabilities.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ACCOUNTING METHODS
The Company recognizes income and expenses based on the accrual method
of accounting.
DIVIDEND POLICY
The Company has not yet adopted a policy regarding payment of dividends.
INCOME TAXES
At December 31, 1999, the Company had a net operating loss carry forward
of approximately $4,000,000. The tax benefit from the loss carry forward
has been fully offset by a valuation reserve because of use of the
future tax benefit is doubtful since the Company has no operations and
there has been a substantial change in stockholders.
The loss carry forward expires starting in the years 1999 through 2019.
13
<PAGE>
RIGID AIRSHIP USA, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
EARNINGS (LOSS) PER SHARE
Earnings (loss) per share amounts are computed based on the weighted
average number of shares actually outstanding, after the stock splits.
FINANCIAL INSTRUMENTS
The carrying amounts of financial instruments, including accounts
payable, are considered by management to be their estimated fair values.
The values are not necessarily indicative of the amount that the Company
could realize in a current market exchange.
ESTIMATES AND ASSUMPTIONS
Management uses estimates and assumptions in preparing financial
statements in accordance with generally accepted accounting principles.
Those estimates and assumptions affect the reported amounts of assets
and liabilities, the disclosure of contingent assets and liabilities,
and the reported revenues and expenses. Actual results could vary from
the estimates that were assumed in preparing these financial statements.
3. AIRSHIP LICENSE
On November 4, 1998 the company purchased a license from a related party
(to become effective on the delivery of the first airship outlined
below) to manufacture and sell an airship by the issuance of 26,000,000
common shares and 20,000,000 preferred shares, a payment of $1,000,000
(past due at the report date), and a 3% royalty on future sales.
Part of the license agreement included the purchase of two completed
airships for a purchase price of 120,000,000 Netherlands Guilders and
provided for an advance deposit of $4,000,000 to start construction of
the airships. At the report date the company did not have the working
capital to complete the terms of the contract, and the license agreement
was terminated.
4. RELATED PARTIES
Rigid Airship Holdings, N.V. owns 26 million (89.8%) of the outstanding
common shares and all of the preferred shares of the Company.
The Company owed a shareholder $29,109 at December 31, 1999.
14
<PAGE>
RIGID AIRSHIP USA, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
5. GOING CONCERN
Continuation of the Company as a going concern is dependent upon
obtaining the working capital necessary to pay its debts and for any
planned activity and the management of the Company has developed a
strategy, which it believes will accomplish this objective through
additional equity funding and long term financing, which will enable the
company to operate in the future.
Management recognizes that if it is unable to raise additional capital,
the Company cannot operate in the future.
6. TRANSFER OF REMAINING ASSETS AND ASSUMPTION OF LIABILITIES
On November 1, 1998 the Company sold and transferred all of its
remaining assets in exchange for the assumption of its liabilities, the
issuance of 150,000 shares of its common capital stock, and a payment of
$150,000. After the transfer date there was a dispute over the assumed
liabilities which had not been settled, and therefore they continue to
be carried on the books of the Company as of year-end 1998.
On November 9, 1998, Rigid Airship USA's predecessor company (Synfuel
Technology Inc.) agreed to transfer all of its existing assets and
business to San Pedro Securities whereby the Company paid San Pedro
Securities the sum of $200,000, in exchange for the assumption of any
and all liabilities of the Company, in order for the Company to explore
new business opportunities. Subsequent to the transfer date, there was a
dispute over the assumed liabilities. totaling $465,643 in accounts
payable. The liabilities continued to be carried on the books of the
Company until September 9, 1999, when the Company issued shares to a
third party in exchange for the third party's assumption of all
previously existing liabilities.
On September 9, 1999, the Company rescinded 1,800,000 restricted common
shares issued to Prime Capital Holdings in November of 1998 due to Prime
Capital's failure to perform contracted services, which included
arranging for the 1998 transfer of the predecessor company's assets in
exchange for the assumption of all of its liabilities. The Company then
issued 1,800,000 restricted common shares to Atlas Free Enterprise,
Inc., a Panamanian company, in exchange for the assumption of $465,643
accounts payable liabilities that had remained on the Company's balance
sheet through September 8, 1999.
7. CONTINUING AND CONTINGENT LIABILITIES
On April 10, 1998 the Company issued 23 (post split) preferred shares,
as payment for debt. On December 1, 1991 the board of directors approved
the retirement on the preferred stock by the issuance of common stock at
the rate of one share of common for two shares of preferred, and during
December 1991 and January 1992, 11 shares of the preferred stock were
retired. Since that time the Company has been unable to locate the
remaining owners of the preferred shares and has reserved 6 shares of
its common stock to make the exchange. If the exchange cannot be made
the liquidation value of the preferred shares still outstanding could
amount to in excess of $140,000, however management believes there will
be no claims.
15
<PAGE>
RIGID AIRSHIP USA, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1999
7. CONTINUING AND CONTINGENT LIABILITIES (Continued)
See Note 3 for contractual payments due in the future.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
None.
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
DOW W. STEWART, 55, President, Treasurer, and Director, appointed
November 16, 1998. Formerly 19 years Merrill Lynch, Chief Financial and
Administrative Officer Global Institutional Sales and Trading, Global Equities
and Research Divisions, Group Manager Office of Corporate Strategy. RJ Walls &
Company, Senior Managing Partner, Treasurer and CFO. Stone & McCarthy Research
Associates, Chief Operating Officer and Treasurer. Graduate of Dartmouth
College.
ELENORA SHUMSKI, 34, Secretary. Formerly publicly traded real estate
development firm, architectural and interior furnishings. Background in investor
relations, SEC filings, receivables, payables, purchasing, payroll, business
software, office management, inventory control, client and vendor relations.
Item 11. EXECUTIVE COMPENSATION
Not applicable.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Not applicable.
Item 13. CERTAIN RELATIONSHIPS
A majority of Company shares are owned by Rigid Airship Holdings NV, a
Curacao corporation, which in 1998 acquired 26,000,000 shares of common stock
and 20,000,000 of preferred shares.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: July 31, 2000 By: /s/ DOW W. STEWART
-------------------- ----------------------------------------
Dow W. Stewart, Director and
President
Date: July 31, 2000 By: /s/ ELENORA SHUMSKI
-------------------- ----------------------------------------
Elenora Shumski, Secretary
16
