U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED
DECEMBER 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
______________ TO ______________
COMMISSION FILE NUMBER: 000-28083
NOSTALGIA MOTORCARS, INC.
(Exact name of registrant as specified in its charter)
Nevada 88-0362112
(State or jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
4502 East Karen Drive, Phoenix, Arizona 85032
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (602) 404-3557
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $0.001 Par Value
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) been subject to such filing
requirements for the past 90 days. Yes X No .
Indicate by check mark if disclosure of delinquent
filers pursuant to Item 405 of Regulation S-K 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-KSB or any
amendment to this Form 10-KSB [ ].
The Registrant had no revenues for the fiscal year ended on
December 31, 1999. The aggregate market value of the voting
stock held by non-affiliates of the Registrant as of March 31,
2000: Common Stock, par value $0.001 per share -- $1,662,500. As
of March 31, 2000, the Registrant had 5,000,000 shares of common
stock issued and outstanding.
TABLE OF CONTENTS
PART I PAGE
ITEM 1. BUSINESS 3
ITEM 2. PROPERTIES 5
ITEM 3. LEGAL PROCEEDINGS 6
ITEM 4. SUBMISSION TO MATTERS TO VOTE OF SECURITY HOLDERS 6
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS 6
ITEM 6. PLAN OF OPERATION 7
ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 10
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE 10
PART III
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT 10
ITEM 10. EXECUTIVE COMPENSATION 12
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT 12
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 13
PART IV
ITEM 13. EXHIBITS, FINANCIAL STATEMENTS SCHEDULES,
AND REPORTS ON FORM 8-K 14
SIGNATURES 15
PART I.
ITEM 1. BUSINESS.
A. Business Development.
Nostalgia Motorcars, Inc., a Nevada corporation ("Company"), was
originally organized on November 23, 1993 as Amexan, Inc.; the
name was changed on June 1, 1998 to Nostalgia Motorcars, Inc.
Prior to the name change, Amexan was an inactive company from the
date of incorporation. The business office of the Company is
located at 4502 East Karen Drive, Phoenix, Arizona 85032. The
Company's fiscal year ends on December 31. Currently, the
Company has one full time and two part time employees (two in
sales and one in accounting), but anticipates adding two full
time and one part time additional employees in the near future
for administrative support.
B. Business of the Registrant.
The Company intends to sell up to 10,000 new "old style"
Volkswagen Beetles in the United States, Canada, and certain
other countries beginning in the first quarter of 2000. The
vehicles that the Company intends to sell differ significantly
from Volkswagens "new style" bug introduced in 1998. The
Company's vehicles are based on the rear engine, air cooled, "old
style" bugs last sold in the United States in 1979. These new
"old style" bugs, although basic in operation and styling, remain
faithful to the personality, charm and friendly quirks of the bug
best known by America.
With over 22 million cars sold worldwide over the years, the
"old style" bug is generally acknowledged to be the most
successful car line in automotive history. Unfortunately, a new
"old style" bug has not been available in the U.S. market for 20
years, leaving an unprecedented number of loyal and sometimes
fanatical admirers to contend with owning old, reconditioned
cars.
The "old style" bugs' incredible success, combined with an
undying used market, steady parts sales and significant Internet
interest, leads management of the Company to believe that a
viable market exists for the new "old style" bugs in the U.S.
Research by management supports the premise that the old style
bug is one of the most recognized production automobiles and its
legend is continually supported by clubs, trade organizations,
and magazines with a large following. Twenty years after the
last bug was sold in the U.S., loyal owners continue to support
the re-sale values of the old style bug. According to Hemmings
Motor News and other industry publications, prices of used old
style bugs in good condition can command over 4 times the
original sales price.
The market for old style bugs goes far beyond the new beetle
in terms of competition. Although some of the Company's
potential customers will be those who choose the old style bug
over the new style bug, the Company will most often find itself
competing with a wide range of cars and in an area of the market
that demands a higher degree vehicle personality as well as sound
structural and performance characteristics. Both new and old
style beetles share the same basic design. Subtle changes to the
new bug offer a slightly more contemporary appearance. The new
beetle is a liquid cooled front engine and front wheel drive
automobile providing 115 horse power whereas the old style bug is
an air cooled rear engine rear wheel drive automobile delivering
60 horsepower. Although basically the same, new production
technologies developed over the past two decades have made the
old style bug a better car. The fit and finish of a new old
style bug manufactured today is, in the opinion of management,
superior to the same car manufactured 25 years ago. Therefore, a
customer who prefers to the styling of the older style bug, while
obtaining the benefits of a modern, well constructed automobile,
will be inclined to choose the new "old style" bug.
Although the new "old style" bug will have obvious and
intrinsic similarities to its predecessor, significant
competition will most likely come from vehicles in a similar
price range. As stated above, some of the Company's customers
may choose the old style bug over the new style, however, the
Company will most often find that its competitive environment
will exist within a wide range of vehicles and not specifically
the new style beetle. The marketing and promotion behind the new
bug continues to reinforce the simple fact that the new exists
because of the success of the old.
The "old style" bug has remained in full production at
Volkswagen's state of the art automotive plant in Pueblo, Mexico,
and over the years Volkswagen has refined the car, producing a
first class fit, finish and overall quality never before offered
in a Bug. New upgrades such as Bosch fuel injection, front disc
brakes, three way catalytic converter, and a remote security
system have been added to ensure it keeps pace with the needs of
today's consumer. Despite this, however, the "old style" bug
remains unavailable for sale in the U.S., because it does not
meet current U.S. Department of Transportation ("DOT"), U.S.
Environmental Protection Agency ("EPA") and California Air
Resources Board ("CARB") standards.
Fortunately, current Federal laws permit the importation,
conversion and sale of virtually any automobile, provided that
the finished cars meet strict DOT and EPA standards and proper
licensing is secured. Accordingly, the Company intends to
purchase new Bugs directly from the Pueblo, Mexico VW factory (or
from several of the over 200 dealers in Mexico) and modify each
car so that it fully complies with U.S. safety and emission
standards, making them fully legal for sale in the U.S.
There are several ways for the Company to obtain the
necessary regulatory clearances for new Bug certification;
however, the Company has chosen to pursue what it believes to be
the most respected and credible license, known as a "small volume
manufacturer" ("SVM") license, If granted by the EPA, a SVM
license would permit the Company to modify and sell in the U.S.
up to 10,000 cars per, year.
The Company expects to sell the cars through direct sales to
automotive dealers, national wholesale car auctions and through
the Internet (on a site to be developed). Current management of
the Company will be initially responsible for securing such
sales. The Company expects to secure letters of credit from
contracted buyers, and proposes to borrow sufficient capital
through a revolving credit facility to finance the purchase,
modification and transportation of the cars on order. The
Company has not as yet secured such a credit facility.
To the Company's knowledge, there are currently no other
manufacturers or suppliers of new "old style" bugs in the U.S.;
however, there is direct competition by Volkswagen who sell a
"new style" bug, and indirect competition by numerous other
"economical" cars offered by established manufactures.
The Company proposes to offer "old style" bugs with a 2 year
limited, bumper to bumper warranty, which will be self
administered by the Company (made possible by the well documented
and proven reliability of the car over many years).
The Company expects that the Bugs will retail for
approximately $13,000. The purchase cost of each car from
sources in Mexico (as discussed below) will be approximately
$6,500. The cost of converting each vehicle, as set forth in the
contract with LPC of New York, Inc., will not exceed $1,600 per
car for the following structural modifications and the emissions
modifications necessary to meet all regulatory requirements
(including the cost of all parts):
(a) Bumper modifications
(b) O.B. II Computer System
(c) Emission Vapor Canister
(d) Required temperature and pressure sensors
(e) Modified speedometer
(f) Warning lights and buzzers for seat belts, parking
brakes, etc.
(g) Proper labeling
(h) Door beams
(i) Dual air bags
Other approximate costs will be $500 for shipping, $700 for
insurance reserves, and $700 for accessories. This will leave a
profit margin of approximately $3,000 per vehicle.
ITEM 2. PROPERTIES.
The Company currently owns approximately $25,000 in general office equipment
and furniture.
The Company neither owns nor leases any real or personal
property. Mr. Randolph provides office space to the Company
without charge. This office space consists of one room of
approximately 250 square feet in the home of Mr. Randolph,
located at 4502 East Karen Drive, Phoenix, Arizona 85032.
This office space is not suitable for the purposes of the
Company (there is adequate insurance coverage on the assets of
the Company at this location). On that basis, the Company is
currently seeking other office space (the Company was able to
cancel a five year lease which it entered into on October 12,
1999 for office space to be located at 15750 Northsite Boulevard,
Scottsdale, Arizona 85260).
ITEM 3. LEGAL PROCEEDINGS.
The Registrant is not a party to any material pending legal
proceedings and, to the best of its knowledge, no such action by
or against the Registrant has been threatened.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not Applicable.
PART II.
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
(a) Market Information.
From June 15, 1998 to October 21, 1999, the Company's common
stock was traded on the Over the Counter Bulletin Board. On
October 21, 1999 the shares were delisted to the National
Quotation Bureau's "Pink Sheets" since the Registrant had not
complied with the new eligibility rules of the Bulletin Board;
that is, all companies must be reporting companies. On January
12, 2000 the Registrant's common stock was relisted on the
Bulletin Board (symbol CRRZ) after its Form 10-SB registration
statement cleared comments with the Securities and Exchange
Commission. The range of closing prices shown below is reported
while trading on the Bulletin Board and the Pink Sheets. The
quotations shown reflect inter-dealer prices, without retail
mark-up, mark-down or commission and may not necessarily
represent actual transactions.
Per Share Common Stock Bid Prices by Quarter
For the Fiscal Year Ending on December 31, 1999
High Low
Quarter Ended December 31, 1999 * 0.44 0.20
Quarter Ended September 30, 1999 0.69 0.17
Quarter Ended June 30, 1999 0.56 0.09
Quarter Ended March 31, 1999 1.25 0.12
* The shares only traded on 13 days during this quarter.
Per Share Common Stock Bid Prices by Quarter
For the Fiscal Year Ended December 31, 1998
High Low
Quarter Ended December 31, 1998 3.00 1.12
Quarter Ended September 30, 1998 4.00 2.62
Quarter Ended June 30, 1998 ** 3.37 3.12
** The Shares commenced trading on the Bulletin Board on June
15, 1998.
(b) Holders of Common Equity.
As of March 31, 2000, there were 33 shareholders of record of the
Registrant's common stock.
(c) Dividends.
The Registrant has not declared or paid a cash dividend to
stockholders since it became a "C" corporation. The Board of
Directors presently intends to retain any earnings to finance
Registrant operations and does not expect to authorize cash
dividends in the foreseeable future. Any payment of cash
dividends in the future will depend upon the Registrant's
earnings, capital requirements and other factors.
(d) Equity Securities Sold Without Registration.
Commencing on January 6, 2000 and up to March 12, 2000, the
Registrant sold debentures in a total amount of $100,000 to five
individuals. No commissions or fees were paid in connection with
these sales. All of these sales were undertaken pursuant to the
limited offering exemption from registration under the Securities
Act of 1933 as provided in Rule 506 under Regulation D. These
sales met the requirements of Rule 506 in that: (a) there are no
more than, or the issuer reasonably believes that there are no
more than, 35 purchasers of securities from the issuer in any
offering under this section; and (b) each purchaser who is not an
accredited investor is a "sophisticated investor," that is, the
investor either alone or with his purchaser representative(s) has
such knowledge and experience in financial and business matters
that he is capable of evaluating the merits and risks of the
prospective investment, or the issuer reasonably believes
immediately prior to making any sale that such purchaser comes
within this description.
ITEM 6. PLAN OF OPERATION.
The following Plan of Operation should be read in conjunction
with the financial statements and accompanying notes included in
this Form 10-KSB.
Twelve Month Plan of Operation.
The Company expects to sell its cars through automobile
wholesalers, new car dealers, and the Internet. The Company has
not yet secured any sales or contracted specific distributors.
The Company has undertaken the necessary steps to begin the
process of securing such a SVM license and has contracted a very
reputable vehicle certification laboratory, LPC of New York, Inc.
("LPC"), of Ronkonkoma, New York. LPC is currently conducting
the necessary testing and assessments to determine the exact
modifications necessary to ensure DOT and EPA certification and a
SVM license. Upon completion of all necessary government
licensing and the issuance of a SVM license, the Company would be
in a position to legally import new bugs from Mexico, modify each
car and retail them as new "classic bugs" in the U.S.
marketplace.
The LPC contract, which has an effective date of September
29, 1999, guarantees certification and a SVM license within 3 to
6 months and will cost $375,000,00. LPC has indicated that
although original crash tests on the VW Beetle are still
available and valid, updated crash tests might have to be
conducted, which would entail an additional cost to the Company
under that contract of up to $175,000. The Company has secured a
total of $300,000 in invested capital from the two principals of
the Company to date (as evidenced by two Promissory Notes
attached as Exhibits to this Form 10-SB); these individuals have
committed to contributing up to an additional total of $250,000
to the capital of the Company in order to complete the LPC
contract and fund initial operations of the Company.
The Company has no direct control over the testing and
licensing necessary to complete the certification and is
dependent on the successful completion of the testing and
modifications. Once completed, LPC and the Company will file the
appropriate documentation with DOT, EPA, and CARB; the Company
has been advised that the final approval process takes
approximately one month to complete (counted in the guaranteed
timeframe quoted by LPC). Once all tests are completed, then it
will be determined the exact modifications that will be needed
for the Bugs to be purchased.
The Company intends to purchase vehicles directly from the
Volkswagen manufacturing plant in Pueblo, Mexico and/or from
several of the more than 200 dealers throughout Mexico ( there
are approximately 100,000 "old style" bugs manufactured and they
are primarily sold in Mexico per year). There are no contracts
in place with any supplier at this time. However, from the
production at this plant, as well as excess supply, it is the
opinion of management that there will be adequate supply of
automobiles for purchase by the Company. There is no license or
other agreement needed from Volkswagen in order for the Company
to buy and convert these automobiles for sale in the U.S. once
the SVM license is in place.
Once the car is purchased from Volkwagen, it will be
converted to meet DOT, EPA, and CARB standards. The Company
intends to subcontract out all modifications and certification
work to a qualified third party conversion facility. There are
several such facilities available and the company to be
contracted by the Company. Although there is no firm agreement
with any such firm, the Company has contacted International Auto
Processors, based in Brunswick, Georgia, about converting the
Company purchased automobiles. This is a large and credible
company which has substantial experience with large volume
conversion facilities, which currently converts approximately
175,000 automobiles per year for such companies BMW and Ford
Motor Company. It is anticipated that a contract with this firm
can be concluded within thirty days from the time that the
Company advised this firm that cars are ready to be shipped.
Although the Company has no major customers, it believes
that will not be dependent on such. Sales are expected to be
geographically widespread and with many small orders.
Except for those outlined above, the Company is not aware of
any government regulations required or any probable governmental
regulation change which would have an adverse effect on the
company.
Year 2000 Issue.
The Year 2000 issue arises because many computerized systems
use two digits rather than four to identify a year. Date
sensitive systems may recognize the year 2000 as 1900 or some
other date, resulting in errors when information using the year
2000 date is processed. In addition, similar problems may arise
in some systems which use certain dates in 1999 to represent
something other than a date. The effects of the Year 2000 issue
may be experienced after January 1, 2000, and if not addressed,
the impact on operations and financial reporting may range from
minor errors to significant system failure which could affect the
Registrant's ability to conduct normal business operations. This
creates potential risk for all companies, even if their own
computer systems are Year 2000 compliant. It is not possible to
be certain that all aspects of the Year 2000 issue affecting the
Registrant, including those related to the efforts of customers,
suppliers, or other third parties, will be fully resolved.
The Registrant currently believes that its systems are Year 2000
compliant in all material respects. The Registrant estimates
that it has incurred minimal costs of less than $10,000 related
to its Year 2000 initiative. Although management is not aware of
any material operational issues or costs associated with
preparing its internal systems for the Year 2000, the Registrant
may experience serious unanticipated negative consequences (such
as significant downtime for one or more of its suppliers) or
material costs caused by undetected errors or defects in the
technology used in its internal systems. Furthermore, the
purchasing patterns of customers may be affected by Year 2000
issues. The Registrant does not currently have any information
about the Year 2000 status of its potential material suppliers.
The Registrant's Year 2000 plans are based on management's best
estimates.
Forward Looking Statements.
The foregoing Plan of Operation "forward looking statements"
within the meaning of Rule 175 under the Securities Act of 1933,
as amended, and Rule 3b-6 under the Securities Act of 1934, as
amended, including statements regarding, among other items, the
Registrant's business strategies, continued growth in the
Registrant's markets, projections, and anticipated trends in the
Registrant's business and the industry in which it operates. The
words "believe," "expect," "anticipate," "intends," "forecast,"
"project," and similar expressions identify forward-looking
statements. These forward-looking statements are based largely
on the Registrant's expectations and are subject to a number of
risks and uncertainties, certain of which are beyond the
Registrant's control. The Registrant cautions that these
statements are further qualified by important factors that could
cause actual results to differ materially from those in the
forward looking statements, including, among others, the
following: reduced or lack of increase in demand for the
Registrant's products, competitive pricing pressures, changes in
the market price of ingredients used in the Registrant's products
and the level of expenses incurred in the Registrant's
operations. In light of these risks and uncertainties, there can
be no assurance that the forward-looking information contained
herein will in fact transpire or prove to be accurate. The
Registrant disclaims any intent or obligation to update "forward
looking statements."
ITEM 7. FINANCIAL STATEMENTS.
Financial statements as of and for the year ended December
31, 1999, for the year ended December 31, 1998, and the year
ended December 31, 1997 are presented in a separate section of
this report following Part IV.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
Not Applicable
PART III.
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS AND COMPLIANCE WITH
SECTION 16(A) OF THE EXCHANGE ACT.
(a) Officers and Directors.
The names, ages, and respective positions of the directors
and officers of the Company are set forth below. These persons
have held their respective positions since May 20, 1999. The
Directors named below will serve until the next annual meeting of
the Registrant's stockholders or until their successors are
duly elected and have qualified. Directors will be elected
for a one-year term at the annual stockholders' meeting.
Officers will hold their positions at the will of the board of
directors, absent any employment agreement, of which none
currently exist or are contemplated. There are no arrangements,
agreements or understandings between non-management shareholders
and management under which non-management shareholders may
directly or indirectly participate in or influence the management
of the Registrant's affairs.
(a) Brad Randolph, President/Secretary/Director.
Mr. Randolph, age 40, received his Bachelor of Science
degree in 1983 from Kent State University, Kent, Ohio. From June
1994 to May 1999, he was employed as a Vice President and
Operations Manager of Shakti Investments, Ltd. Shakti
Investments, Inc. is an international investment, import/export,
and trading company based in Phoenix, Arizona. Mr. Randolph's
principal responsibilities included the research, qualification
and negotiation of new business opportunities internationally.
In this position, he gained extensive experience. with the
planning, coordination and regulatory compliance required for the
import and export of commodities with the U.S. and with several
foreign countries.
For the period of October 1988 to May 1994, Mr. Randolph
served as the President/co-founder of EyeLevel, Inc. At the
time, EyeLevel, Inc. was the nations highest volume promotional
sunglass manufacturing company. Mr. Randolph secured exclusive
rights for North America from Avery International, now Avery
Dennison, to utilize a patented printing technology for EyeLevel,
Inc. His responsibilities at this firm included the
administration, marketing, and distribution for the company's two
largest product groups, licensed products and national
promotions. The Licensed Product group acquired licenses from
The National Football League, Major League Baseball, The National
Basketball Association, and over 60 colleges and universities
throughout the United States. Mr. Randolph personally developed
a distribution network for this company that covered all major
markets utilizing major retailers like Wal-Mart, Kmart, J.C.
Penny Company, as well as numerous grocery chains. The
promotional group developed and implemented successful national
campaigns for Pepsi Cola, The National Football League, and
America West Airlines.
(b) Anoop Pittalwala, Vice President/Treasurer/Director
Mr. Pittalwala, age 42, earned his Bachelor of Science
Degree in Mechanical Engineering in 1981 from University of
British Columbia. From 1997 to May 1999, he served as
President/Director of Shatki Investments, Inc., the same firm
that employed Mr. Randolph. In this position, Mr. Pittalwala
performed executive level management and administration of
diverse business, trading, and investment activities. He was
involved in the promotion, marketing, and penetration of
international markets through the trade of commodities, consumer
products, and financial instruments. Mr. Pittalwala also
successfully coordinated the complete start-up of this company
and negotiated and secured contracts with other international and
domestic client base.
For the period of 1985 to 1997, Mr. Pittalwala was employed
as a Senior Vice President/Director of Geepe Holdings,
Inc./Pacific Homes Inc., a firm specializing in single and multi-
family housing developments. In this position, he directed and
supervised product marketing, financial management and new
product development functions for the entire organization. Mr.
Pittalwala also sourced and secured financing, maintained
financial and internal controls, managed cash flow and collection
procedures, and supervised the complete construction of all
projects from groundbreaking to completion. He also successfully
developed and launched effective advertising and marketing
campaigns.
(b) Compliance with Section 16(a) of the Exchange Act.
Section 16(a) of the Securities Exchange Act of 1934 requires
executive officers and directors, and persons who beneficially
own more than 10% of any class of the Registrant's equity
securities to file initial reports of ownership and reports of
changes in ownership with the Securities and Exchange Commission
("SEC"). Executive officers, directors and beneficial owners of
more than 10% of any class of the Registrant's equity securities
are required by SEC regulations to furnish the Registrant with
copies of all Section 16(a) forms they file.
Based solely on a review of the copies of such forms furnished to
the Registrant during or with respect to fiscal 1999, and certain
written representations from executive officers and directors,
the Registrant is aware that each such reporting persons
inadvertently failed to file a Form 3 at the time the Registrant
became registered under Section 12 of such act (December 4,
1999). Such forms have been prepared and filed.
ITEM 10. EXECUTIVE COMPENSATION.
SUMMARY COMPENSATION TABLE
Annual Long-Term
Compensation Compensation
Awards Payouts
Securi
Other ties
Name and annual under All
Principal Year compen lying other
Position Salary Bonus sation Restrict options/ LTIP compen
stock SARs pay sation
award outs
($) ($) ($) ($) (#) ($) ($)
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Brad Randolph
President/ 1999 $ 40,000 0 0 $750,000 0 0 0
1998 0 0 0 0 0 0 0
Anoop
Pittalwala 1999 $ 30,000 0 0 $ 87,500 0 0 0
V.P./Treas 1998 0 0 0 0 0 0 0
Other Compensation.
(a) There are no annuity, pension or retirement benefits
proposed to be paid to officers, directors, or employees of the
Registrant in the event of retirement at normal retirement date
as there is no existing plan provided for or contributed to by
the Registrant.
(b) No remuneration is proposed to be paid in the future
directly or indirectly by the Registrant to any officer or
director since there is no existing plan which provides for such
payment, including a stock option plan.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
The following table sets forth information regarding the
beneficial ownership of shares of the Registrant's common stock
as of March 31, 2000 (5,000,000 issued and outstanding) by (i)
all stockholders known to the Registrant to be beneficial owners
of more than 5% of the outstanding common stock; and (ii) the
officers and directors of the Company (each person has sole
voting power and sole dispositive power as to all of the shares
shown as beneficially owned by them):
Title of Name and Address Amount of Percent of
Class Beneficial Owner Beneficial Class
Ownership
Common
Stock Brad Randolph 1,500,000 30%
4502 East Karen Drive
Phoenix, Arizona 85032
Common
Stock Anoop Pittalwala 175,000 3.5%
11931 North 69th Avenue
Glendale, Arizona 85308
Common
Stock Shares of all directors and 1,675,000 33.5%
executive officers as a
group (2 persons)
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Other than as set forth below, there are no relationships,
transactions, or proposed transactions to which the registrant
was or is to be a party, in which any of the named persons set
forth previously had or is to have a direct or indirect material
interest.
(a) Loans by Principals.
As indicated under Description of Business, the two
principals of the Company, have each loaned the Company $150,000.
Each of these loans is evidenced by a promissory note dated June
11, 1999 and bearing interest at a rate equal to the prime rate
as announced by the Wall Street Journal as of the last business
day prior to the first day of each calendar quarter and adjusted
as of the first day of each calendar quarter during the term of
the promissory note. Under the terms of the promissory notes,
the entire outstanding principal balance, together with all
accrued and unpaid interest, shall be due and payable in full not
later than the Maturity Date, which is two years from the date of
the promissory note.
Under the terms of the promissory notes, the principals
may, at their option and at any time and from time to time,
convert all or any portion of the then outstanding principal
amount and accrued interest hereunder into that number of fully
paid and nonassessable Shares equal to 25% of the then
outstanding principal amount of the note as of the date of
conversion. For example, if the principal amount on the date of
conversion is $100,000, and the stock is trading at $1.00 per
share on that date, then he would receive 25,000 Shares. The
principals may exercise this option an more than one occasion, so
long as there still remains an outstanding principal balance
under the promissory notes.
In case of any reorganization or recapitalization of
the Company (by reclassification of its outstanding Shares or
otherwise), or its consolidation or merger with or into another
corporation, the principals will, upon conversion, be entitled to
receive the shares of stock, cash or other consideration which
they would receive upon such reorganization, recapitalization,
consolidation or merger if immediately prior thereto the
conversion had occurred and the principals had exchanged the
Shares in accordance with the terms of such reorganization,
recapitalization, consolidation or merger.
(b) Office Space.
The Company neither owns nor leases any real or personal
property. Mr. Randolph provides office space to the Company
without charge. This office space consists of one room of
approximately 250 square feet in the home of Mr. Randolph,
located at 4502 East Karen Drive, Phoenix, Arizona 85032. This
office space is not suitable for the purposes of the Company
(there is adequate insurance coverage on the assets of the
Company at this location). See "Item 2. Properties."
PART IV.
ITEM 13. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K.
(a) Index to Financial Statements and Schedules Page
Report of Independent Auditor 15
Balance Sheets of the Registrant as of
December 31, 1999, 1998, and 1997 16
Statements of Operations for the years ended
December 31, 1999, 1998, and 1997 18
Statements of Shareholders' Equity for the years
ended December 31, 1999, 1998, and 1997 19
Statements of Cash Flows for the years ended
December 31, 1999, 1998, and 1997 20
Notes to Financial Statements 21
(b) Reports on Form 8-K. There were no reports on Form 8-K
filed during the last quarter of the fiscal year covered by this
report.
(c) Exhibits included or incorporated by reference herein: See
Exhibit Index
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.
NOSTALGIA MOTORCARS, INC.
Dated: April 13, 2000 By: /s/ Brad Randolph
Brad Randolph, President
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the Registrant and in the capacities and on the date
indicated:
Signature Title Date
/s/ Brad Randolph President/Secretary/Director April 13, 2000
Brad Randolph
/s/ Anoop Pittalwala Vice President/Treasurer April 13, 2000
Anoop Pittalwala (Principal Financial and
Accounting Officer)/Director
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Nostalgia Motorcars, Inc.
Phoenix, Arizona
I have audited the accompanying Balance Sheets of Nostalgia
Motorcars, Inc. (A Development Stage Company), as of December 31,
1999, December 31, 1998, and December 31, 1997, and the related
statement of stockholder's equity for December 31, 1999, December
31, 1998, and December 31, 1997 and the statements of operations
and cash flows for the three years ended December 31, 1999,
December 31, 1998, and December 31, 1997 and the period August
30, 1995 (inception) to December 31, 1999. These financial
statements are the responsibility of the Company's management. My
responsibility is to express an opinion on these financial
statements based on my audit.
I conducted my 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. I believe that my
audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of
Nostalgia Motorcars, Inc. (A Development Stage Company), as of
December 31, 1999, December 31, 1998, and December 31, 1997, and
the related statement of stockholder's equity for December 31,
1999, December 31, 1998, and December 31, 1997 and the statements
of operations and cash flows for the three years ended December
31, 1999, December 31, 1998, and December 31, 1997 and the period
August 30, 1995 (inception) to December 31, 1999, in conformity
with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming
the Company will continue as a going concern. As discussed in
Note #5 to the financial statements, the Company has suffered
recurring losses from operations and has no established source of
revenue. This raises substantial doubt about its ability to
continue as a going concern. Management's plan in regard to these
matters is described in Note #5. These financial statements do
not include any adjustments that might result from the outcome of
this uncertainty.
/s/ Barry L. Friedman
Barry L. Friedman
Certified Public Accountant
Las Vegas, Nevada
April 12, 2000
NOSTALGIA MOTORCARS, INC.
(Formerly Amexan, Inc.)
(A Development Stage Company)
BALANCE SHEET
ASSETS
December December December
31, 1999 31, 1998 31, 1997
CURRENT ASSETS
CASH $ 25,954 $ 0 $ 0
TOTAL CURRENT ASSETS $ 25,954 $ 0 $ 0
FIXED ASSETS
Automobile (Net) $ 8,900 $ 0 $ 0
Equipment-Computer (Net) 6,771 0 0
TOTAL FIXED ASSETS $ 15,671 $ 0 $ 0
OTHER ASSETS
Research and Development $ 16,920 $ 0 $ 0
Deposits 47,426 0 0
Organization Costs (Net) 0 0 36
TOTAL OTHER ASSETS $ 64,346 $ 0 $ 36
TOTAL ASSETS $105,971 $ 0 $ 36
The accompanying notes are an integral part of these financial
statements
NOSTALGIA MOTORS CARS, INC.
(Formerly Amexan, Inc.)
(A Development Stage Company)
BALANCE SHEET
LIABILITIES AND STOCKHOLDERS' EQUITY
December December December
31, 1999 31, 1998 31, 1997
CURRENT LIABILITIES
Accounts Payable $ 22,750 $ 0 $ 0
Officer's Loans (Note #5) 300,000 0 0
Officer's Advances (Note #5) 14,195 1,945 485
TOTAL CURRENT LIABILITIES $336,945 $ 1,945 $ 485
STOCKHOLDERS' EQUITY (Note #4)
Common stock
Par value $0.001
Authorized 50,000,000 shares
Issued and outstanding at
December 31, 1997 -
5,000,000 shares $ 5,000
December 31, 1998 -
5,000,000 shares $ 5,000
December 31, 1999 -
5,000,000 shares $ 5,000
Additional Paid-In Capital 0 0 0
Deficit accumulated during
the development stage (235,974) (6,945) (5,449)
TOTAL STOCKHOLDERS' EQUITY $(230,974) $ (1,945) $ (449)
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 105,971 $ 0 $ 36
The accompanying notes are an integral part of these financial
statements
NOSTALGIA MOTORS CARS, INC.
(Formerly Amexan, Inc.)
(A Development Stage Company)
STATEMENT OF OPERATIONS
Year Year Year Nov. 23,1993
Ended Ended Ended (Inception)
Dec. 31 Dec. 31 Dec. 31 to Dec. 31
1999 1998 1997 1999
INCOME
Revenue $ 0 $ 0 $ 0 $ 0
EXPENSES
General, Selling and
Administrative $227,339 $ 1,460 $ 0 $234,089
Depreciation 1,690 0 0 1,690
Amortization 0 36 39 195
TOTAL EXPENSES $229,029 $ 1,496 $ 39 $235,974
NET PROFIT/LOSS (-) $(229,029)$(1,496) $ (39) $(235,974)
Net Profit/Loss(-)
per weighted share
(Note #2) $ (.05)$ Nil $ Nil $ (.05)
Weighted average
Number of common
shares outstanding 5,000,000 5,000,000 5,000,000 5,000,000
The accompanying notes are an integral part of these financial
statements
NOSTALGIA MOTORCARS, INC.
(Formerly Amexan, Inc.)
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Additional Accumu-
Common Stock paid-in lated
Shares Amount Capital Deficit
Balance,
December 31, 1996 5,000,000 $5,000 $ 0 $ (5,410)
Net loss year ended
December 31, 1997 (39)
Balance,
December 31, 1997 5,000,000 $5,000 $ 0 $ (5,449)
Net loss year ended
December 31, 1998 (1,496)
Balance,
December 31, 1998 5,000,000 $5,000 $ 0 $(6,945)
Net loss year ended
December 31, 1999 (229,029)
Balance,
December 31, 1999 5,000,000 $5,000 $ 0 $(235,974)
The accompanying notes are an integral part of these financial
statement
NOSTALGIA MOTORCARS, INC.
(Formerly Amexan, Inc.)
(A Development Stage Company)
STATEMENT OF CASH FLOWS
Year Year Year Nov. 23,1993
Ended Ended Ended (Inception)
Dec. 31 Dec. 31 Dec. 31 to Dec. 31
1999 1998 1997 1999
Cash Flows from
Operating Activities
Net Loss $ (229,029) $ (1,496) $ (39) $ (235,974)
Adjustment to
Reconcile net loss
To net cash provided
by operating
Activities
Amortization 0 36 39 195
Depreciation 1,690 0 0 1,690
Increase in Current
Assets
Organization Costs 0 0 0 (195)
Research & Development (16,920) 0 0 (16,920)
Deposits (47,426) 0 0 (47,426)
Automobile (7,473) 0 0 (7,473)
Computer (9,888) 0 0 (9,888)
Increase in current
Liabilities
Accounts Payable 22,750 0 0 22,750
Officer's Loan 300,000 0 0 300,000
Officer's Advances 12,250 1,460 0 14,195
Net cash used in
Operating activities 25,954 0 0 20,954
Cash Flows from
Investing Activities 0 0 0 0
Cash Flows from
Financing Activities
Issuance of Common
Stock for Cash 0 0 0 5,000
Net Increase (decrease) 25,954 0 0 25,954
Cash,
Beginning of period 0 0 0 0
Cash, End of period 25,954 0 0 25,954
The accompanying notes are an integral part of these financial
statement
NOSTALGIA MOTORCARS, INC.
(Formerly Amexan, Inc.)
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
December 31, 1999, December 31, 1998, and December 31, 1997
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized November 23, 1993, under the laws of
the State of Nevada as Amexan, Inc. The Company currently has no
operations and in accordance with SFAS #7, is considered a
development company. On June 1, 1998 the Company changed its
name to Nostalgia Motorcars, Inc.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Method
The Company records income and expenses on the accrual method.
Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of revenue and expenses during the reporting
period. Actual results could differ from those estimates.
Cash and equivalents
The Company maintains a cash balance in a non-interest-bearing
bank that currently does not exceed federally insured limits. For
the purpose of the statements of cash flows, all highly liquid
investments with the maturity of three months or less are
considered to be cash equivalents. There are no cash equivalents
as of December 31, 1999.
Income Taxes
Income taxes are provided for using the liability method of
accounting in accordance with Statement of Financial Accounting
Standards No. 109 (SFAS #109) "Accounting for Income Taxes". A
deferred tax asset or liability is recorded for all temporary
difference between financial and tax reporting. Deferred tax
expense (benefit) results from the net change during the year of
deferred tax assets and liabilities.
Organization Costs
Costs incurred to organize the Company were amortized on a
straight-line basis over a sixty-month period.
Loss Per Share
Net loss per share is provided in accordance with Statement of
Financial Accounting Standards No. 128 (SFAS #128) "Earnings Per
Share". Basic loss per share is computed by dividing losses
available to common stockholders by the weighted average number
of common shares outstanding during the period. Diluted loss per
share reflects per share amounts that would have resulted if
dilative common stock equivalents had been converted to common
stock. As of December 31, 1998, the Company had no dilative
common stock equivalents such as stock options.
Year End
The Company has selected December 31 as its year-end.
Year 2000 Disclosure
The year 2000 issue is the result of computer programs being
written using two digits rather than four to define the
applicable year. Computer programs that have time sensitive
software may recognize a date using "00" as the year 1900 rather
than the year 2000. This could result in a system failure or
miscalculations causing disruption of normal business activities.
Since the Company currently has no operating business and does
not use any computers, and since it has no customers, suppliers
or other constituents, there are no material Year 2000 concerns.
NOTE 3 - INCOME TAXES
There is no provision for income taxes for the period ended
December 31, 1999, due to the net loss and no state income tax in
Nevada, the state of the Company's domicile and operations. The
Company's total deferred tax asset as of December 31, 1999 is as
follows:
Net operation loss carry forward $ 235,974
Valuation allowance $ 235,974
Net deferred tax asset $ 0
The federal net operation loss carry forward will expire in
various amounts from 2013 to 2019. This carry forward may be
limited upon the consummation of a business combination under IRC
Section 381.
NOTE 4 - STOCKHOLDERS' EQUITY
Common Stock
The authorized common stock of the corporation consists of
50,000,000 shares with a par value of $0.001 per share.
Preferred Stock
The corporation has no preferred stock.
On November 30, 1993, the Company issued 5,000,000 shares of its
$0.001 par value common stock in consideration of $5,000 in cash.
NOTE 5 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern,
which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. However, the
Company does not have significant cash or other material assets,
nor does it have an established source of revenues sufficient to
cover its operating costs and to allow it to continue as a going
concern. It is the intent of the Company to seek a merger with an
existing, operating company. Until that time, the
stockholders/officers and or directors have committed to
advancing or loaning the operating costs of the Company interest
free.
NOTE 6 - RELATED PARTY TRANSACTIONS
The officers and directors of the Company are involved in other
business activities and may, in the future, become involved in
other business opportunities. If a specific business
opportunity becomes available, such persons may face a conflict
in selecting between the Company and their other business
interests. The Company has not formulated a policy for the
resolution of such conflicts.
NOTE 7 - WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any
additional shares of common stock.
EXHIBIT INDEX
Exhibit No. Description
3.1 Article of Incorporation of the Registrant (incorporated by
reference to Exhibit 3.1 of the Form 10-SB/A filed on December 8,
1999).
3.2 Certificate of Amendment of Articles of Incorporation
(incorporated by reference to Exhibit 3.2 of the Form 10-SB/A
filed on December 8, 1999).
3.3 Bylaws of the Registrant (incorporated by reference to
Exhibit 3.3 of the Form 10-SB/A filed on December 8, 1999).
10.1 Agreement to Provide Services for Certification between the
Registrant and LPC of New York, Inc., dated September 28, 1999
(incorporated by reference to Exhibit 10.1 of the Form 10-SB/A
filed on December 8, 1999).
10.2 Promissory Note made by Brad Randolph in favor of the
Registrant, dated June 11, 1999 (incorporated by reference to
Exhibit 10.2 of the Form 10-SB/A filed on December 8, 1999).
10.3 Promissory Note made by Anoop Pittalwala in favor of the
Registrant, dated June 11, 1999 (incorporated by reference to
Exhibit 10.3 of the Form 10-SB/A filed on December 8, 1999).
27 Financial Data Schedule (see below).
<TABLE> <S> <C>
<S> <C>
<PAGE>
<ARTICLE>5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE AUDITED FINANCIAL STATEMENTS IN REGISTRANT'S FORM 10-KSB
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER>1
<S>
<C>
<PERIOD-TYPE>
YEAR YEAR
<FISCAL-YEAR-END> DEC-31-1999 DEC-31-1998
<PERIOD-START> JAN-01-1999 JAN-01-1998
<PERIOD-END> DEC-31-1999 DEC-31-1998
<CASH> 25,954 0
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 25,594 0
<PP&E> 15,671 0
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 105,971 0
<CURRENT-LIABILITIES> 336,945 1,945
<BONDS> 0 0
0 0
0 0
<COMMON> 5,000 5,000
<OTHER-SE> (230,974) (1,945)
<TOTAL-LIABILITY-AND-EQUITY> 105,971 0
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 229,029 1,496
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (229,029) (1,496)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (229,029) (1,496)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (229,029) (1,496)
<EPS-BASIC> (.05) (.00)
<EPS-DILUTED> (.05) (.00)
</TABLE>
