U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB-A2
Registration Statement on Form 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL
BUSINESS ISSUERS
NATIONAL AIR CORPORATION
(Name of Small Business Issuer as specified in its charter)
NEVADA 87-0565948
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) ID. No.)
0-22711
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(SEC File No.)
5525 South 900 East, Suite 110
Salt Lake City, Utah 84117
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(Address of Principal Executive Office)
Issuer's Telephone Number, including Area Code: (801) 262-8844
Securities registered pursuant to Section 12(b) of the Exchange Act: None
Securities registered pursuant to Section 12(g) of the Exchange Act:
$0.001 par value common stock
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Title of Class
DOCUMENTS INCORPORATED BY REFERENCE: See the Exhibit Index herein.
PART I
Item 1. Description of Business.
Business Development.
National Air Corporation (the "Company") was organized under the laws of
the State of Nevada on January 9, 1985. The Company was incorporated to engage
in any lawful activity. The Company is not in the airline business and is not
necessarily looking to acquire or be acquired by a company in that business or
with any relation to that business. National Air Corporation is not related to
any other company with a similar name.
The Company was initially authorized to issue a total of 20,000,000 shares
of common stock having a par value of one mill ($0.001) per share, with
fully-paid stock not to be liable for further call or assessment. Copies of the
Company's initial Articles of Incorporation and Bylaws are attached as exhibits
to this Registration Statement and are incorporated herein by this reference.
See the Exhibit Index, Part III.
Following the Company's inception, the Board of Directors authorized the
issuance of 100,000 "unregistered" and "restricted" shares of its common stock
to directors, executive officers and persons who may be deemed to have been
promoters or founders of the Company for the total consideration of $1,000.
Commencing in February, 1985, and pursuant to an exemption provided by Rule
504 of Regulation D of the Securities Act of 1933, as amended (the "1933 Act"),
and the securities laws of the State of Nevada, the Company publicly offered and
sold an aggregate total of 2,000,000 Units to public investors who were
residents of the State of Nevada, at a price of 2 1/2 cents ($0.025) per Unit,
each unit consisting of one share of the Company's common stock par value $.001
per share and one common share purchase warrant. The offering was subsequently
completed, with the Company receiving aggregate gross proceeds of $50,000,
before payment of legal, accounting and printing expenses. None of the warrants
were exercised and are now void due to their expiration six months after the
offering, as outlined in the terms under the Offering Circular. A copy of the
Company's original Offering Circular is attached herein by this reference. See
the Exhibit Index, Part III.
On September 26, 1985, the Company filed with the Secretary of State of the
State of Nevada a Certificate of Amendment to the Articles of Incorporation,
which (i) changed Article IV of the Articles of Incorporation to read as; "IV.
AUTHORIZATION OF CAPITAL STOCK: The amount of the total authorized capital stock
of the Corporation shall be Three Hundred and Seventy Thousand Dollars
($370,000.00) consisting of Twenty Million (20,000,000) shares of common stock
with a par value of one tenth of one cent ($0.001) per share; one million
(1,000,000) shares of Class A Preferred Stock with a par value of twenty five
cents ($0.25) per share each with designations, preferences, limitations and
relative rights described below and one million (1,000,000) Class B Preferred
Stock with a par value of ten cents ($0.10) per share each with designations,
preferences, limitations and relative rights described below. All shares of
common stock have identical rights and privileges in every respect." All rights
and preferences assigned to the preferred shares are outlined under the caption
"Description of Securities", Part I, Item 8, herein. A copy of the Amendment of
the Articles of Incorporation is incorporated herein by this reference. See the
Exhibit Index, Part III.
From 1985 to approximately 1992 the Company engaged in the business of
leasing and/or chartering of aircraft to provide air transportation services.
These operations were unsuccessful and the Company ceased all activities in
1992. Due to the substantial lapse of time since the occurrence of these events,
management does not anticipate that they will have any adverse impact on any
future operations in which the Company may engage.
On April 25, 1995, the Board of Directors resolved to issue 750,000 shares
of "unregistered" and "restricted" common stock to the current officers and
directors. Accordingly, Jeff D. Jenson, President and Director; Jason R. Lewis,
Vice President and Director; and Wendy Moler-Lewis, Secretary / Treasurer and
Director; were each issued 250,000 shares of "unregistered" and "restricted"
common stock.
On July 14, 1996, the Board of Directors of the Company unanimously
resolved to opt out of the provisions of Sections 78.378 to 78.3793, Nevada
Revised Statutes, which relates to "control share acquisitions" (the
"Acquisitions Act").
Sections 78.378 to 78.3793, Nevada Revised Statutes, which apply only to
certain types of publicly-held corporations, provide that "control shares"
acquired under certain circumstances shall have the same voting rights as they
had before the acquisition only to the extent that the stockholders of the
corporation have approved such rights. The Nevada Revised Statutes also give
dissenter's rights to the stockholders in the event that full voting rights are
accorded to shares acquired in a "control share acquisition" and the acquiring
person has acquired "control shares" with at least a majority of all voting
power. Sections 78.738 to 78.3793 permit a corporation's articles of
incorporation or bylaws to provide for an exemption from the Acquisitions Act.
The net effect of the Company's exemption from the Acquisitions Act is to remove
the need for stockholder approval of acquisitions of controlling interests in
the Company. The Company will still be subject to the provisions of Regulation
14A of the Securities and Exchange Commission, regarding proxy solicitations.
However, these provisions deal with the nature and extent of disclosure required
when a matter is to be voted on, but not whether a matter is to be voted on;
accordingly, Regulation 14A in no way negates the effect of the exemption from
the Acquisitions Act. See the heading "Need for any Governmental Approval of
Principal Products or Services" under the caption "Business," herein.
The Company does not foresee providing shareholders with any disclosure
documents, including audited financial statements, of a target company and its
business prior to consummation of a merger.
Acting without a meeting, pursuant to Section 78.207(4) of the Nevada
Revised Statutes, on July 14, 1996, the Board of Directors of the Company
unanimously resolved: (i) to effect a 1 share for 20 reverse split of the
Company's 6,750,000 then-outstanding shares of common stock, effective as of the
close of business, on July 31, 1996, retaining the authorized capital at
20,000,000 shares and the par value at one mill ($0.001) per share, with
appropriate adjustments being made in the additional paid in capital and stated
capital accounts of the Company and with fractional shares to be rounded to the
nearest whole share. All shares referred to herein after this point reflect the
aforementioned reverse split. No change was made to the authorized number of
shares of preferred stock or the par value thereof.
On October 26, 1996, The Board of Directors, resolved to issue 400,000
post-split "unregistered" and "restricted" shares of the Company's common stock
to Jenson Services, Inc., consultant to the Company, in consideration of the sum
of $2,557.25. These funds were used by Jenson Services to pay costs associated
with legal fees and accounting costs, on behalf of the Company. Following the
issuance of the aforementioned shares, 737,505 post-split shares of common stock
are currently outstanding.
Business.
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The Company has had no business operations since approximately 1992. To the
extent that the Company intends to continue to seek the acquisition of assets,
property or business that may benefit the Company and its stockholders, the
Company is essentially a "blank check" company. Because the Company has no
assets, conducts no business and has no employees, management anticipates that
any such acquisition would require the Company to issue shares of its common
stock as the sole consideration for the acquisition. This may result in
substantial dilution of the shares of current stockholders. The Company's Board
of Directors shall make the final determination whether to complete any such
acquisition; the approval of stockholders will not be sought unless required by
applicable laws, rules and regulations, the Company's Articles of Incorporation
or Bylaws, or contract. Even if stockholder approval is sought, Jeff D. Jenson,
who is a director and the President of the Company, beneficially owns
approximately fifty-six percent (56%) of the outstanding shares of common stock
of the Company, and could approve any acquisition, reorganization or merger he
deemed acceptable. The Company makes no assurance that any future enterprise
will be profitable or successful.
The Company is not currently engaging in any substantive business activity
and has no plans to engage in any such activity in the foreseeable future. In
its present form, the Company may be deemed to be a vehicle to acquire or merge
with a business or company. The Company does not intend to restrict its search
to any particular business or industry, and the areas in which it will seek out
acquisitions, reorganizations or mergers may include, but will not be limited
to, the fields of high technology, manufacturing, natural resources, service,
research and development, communications, transportation, insurance, brokerage,
finance and all medically related fields, among others. The Company recognizes
that because of its total lack of resources, the number of suitable potential
business ventures which may be available to it will be extremely limited, and
may be restricted to entities who desire to avoid what these entities may deem
to be the adverse factors related to an initial public offering ("IPO"). The
most prevalent of these factors include substantial time requirements, legal and
accounting costs, the inability to obtain an underwriter who is willing to
publicly offer and sell shares, the lack of or the inability to obtain the
required financial statements for such an undertaking, limitations on the amount
of dilution public investors will suffer to the benefit of the stockholders of
any such entities, along with other conditions or requirements imposed by
various federal and state securities laws, rules and regulations. Any of these
types of entities, regardless of their prospects, would require the Company to
issue a substantial number of shares of its common stock to complete any such
acquisition, reorganization or merger, usually amounting to between 80 and 95
percent of the outstanding shares of the Company following the completion of any
such transaction; accordingly, investments in any such private entity, if
available, would be much more favorable than any investment in the Company.
Management intends to consider a number of factors prior to making any
decision as to whether to participate in any specific business endeavor, none of
which may be determinative or provide any assurance of success. These may
include, but will not be limited to an analysis of the quality of the entity's
management personnel; the anticipated acceptability of any new products or
marketing concepts; the merit of technological changes; its present financial
condition, projected growth potential and available technical, financial and
managerial resources; its working capital, history of operations and future
prospects; the nature of its present and expected competition; the quality and
experience of its management services and the depth of its management; its
potential for further research, development or exploration; risk factors
specifically related to its business operations; its potential for growth,
expansion and profit; the perceived public recognition or acceptance of its
products, services, trademarks and name identification; and numerous other
factors which are difficult, if not impossible, to properly analyze without
referring to any objective criteria.
Regardless, the results of operations of any specific entity may not
necessarily be indicative of what may occur in the future, by reason of changing
market strategies, plant or product expansion, changes in product emphasis,
future management personnel and changes in innumerable other factors. Further,
in the case of a new business venture or one that is in a research and
development mode, the risks will be substantial, and there will be no objective
criteria to examine the effectiveness or the abilities of its management or its
business objectives. Also, a firm market for its products or services may yet
need to be established, and with no past track record, the profitability of any
such entity will be unproven and cannot be predicted with any certainty.
Management will attempt to meet personally with management and key
personnel of the entity sponsoring any business opportunity afforded to the
Company, visit and inspect material facilities, obtain independent analysis or
verification of information provided and gathered, check references of
management and key personnel and conduct other reasonably prudent measures
calculated to ensure a reasonably thorough review of any particular business
opportunity; however, since the Company has no current assets or cash reserves,
these activities may be limited, and if undertaken, the cost and expense thereof
will be advanced by management, and may further dilute the interest of the
stockholders of the Company.
The Company is unable to predict the time as to when and if it may actually
participate in any specific business endeavor. The Company anticipates that
proposed business ventures will be made available to it through personal
contacts of directors, executive officers and principal stockholders,
professional advisors, broker dealers in securities, venture capital personnel,
members of the financial community and others who may present unsolicited
proposals. In certain cases, the Company may agree to pay a finder's fee or to
otherwise compensate the persons who submit a potential business endeavor in
which the Company eventually participates. Such persons may include the
Company's directors, executive officers, beneficial owners or their affiliates.
In this event, such fees may become a factor in negotiations regarding a
potential acquisition and, accordingly, may present a conflict of interest for
such individuals. See the caption "Conflicts of Interest; Related Party
Transactions," below.
Although the Company has not identified any potential acquisition target,
the possibility exists that the Company may acquire or merge with a business or
company in which the Company's executive officers, directors, beneficial owners
or their affiliates may have an ownership interest. Current Company policy does
not prohibit such transactions. Because no such transaction is currently
contemplated, it is impossible to estimate the potential pecuniary benefits to
these persons.
Although it currently has no plans to do so, depending on the nature and
extent of services rendered, the Company may compensate members of management in
the future for services that they may perform for the Company. Because the
Company currently has no resources, and is unlikely to have any resources until
it has completed a merger or acquisition, management expects that any such
compensation would take the form of an issuance of the Company's stock to these
persons; this would have the effect of further diluting the holdings of the
Company's other stockholders.
Further, substantial fees are often paid in connection with the completion
of these types of acquisitions, reorganizations or mergers, ranging from a small
amount to as much as $250,000. These fees are usually divided among promoters or
founders, after deduction of legal, accounting and other related expenses, and
it is not unusual for a portion of these fees to be paid to members of
management or to principal stockholders as consideration for their agreement to
retire a portion of the shares of common stock owned by them. Such fees may
become a factor in negotiations regarding any potential acquisition by the
Company and, accordingly, may present a conflict of interest for such
individuals. See the caption "Conflicts of Interest; Related Party
Transactions."
Involvement in Other "Blank Check" Companies.
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None of the Officer's and Director's are or have ever been involved in a
blank check public offerings and have no plans to do such an offering.
Furthermore, none of the current Officers or Directors were involved when the
Company had operations. However, future involvement in other public companies
is very likely, but presently unplanned.
Jeff Jenson, President and Director. Other than the Company, Mr. Jenson was
appointed in February 1997 as President and Director of United States Mining and
Exploration, a Utah Corpoation, in which capacity he presently serves. In
addition, Mr. Jenson was an Officer and Director of Blackwater, Inc., a
Nevada Corporation, from March 1993 until his resignation was accepted by the
Board of Directors in August of 1994. In addition, Mr. Jenson was an Officer
and Director of Westcott Financial Corporation, a Delaware Corporation,
from November of 1993 until his resignation was accepted by the Board of
Directors in April of 1995. Mr. Jenson was also an Officer and Director
of Onasco, Inc., a Utah Corporation, from June of 1994 until his resignation was
accepted by the Board of Directors in May of 1995. Mr. Jenson was an Officer
and Director of Opell, Inc., a Nevada Corporation, from November 1994
until his resignation was accepted by the Board of Directors in October of 1996.
Mr. Jenson was an Officer and Director of Summa Vest, Inc., a Utah
Corporation, from December 1994 until his resignation was accepted by the Board
of Directors in December of 1996. Other than the aforementioned, Mr. Jenson has
been neither an Officer, Director or affiliate of any other public companies in
the past 10 years.
The following table summarizes the companies for which Mr. Jenson has
served as a director, executive officer or consultant and the consideration
received in connection with each reorganization:
<TABLE>
<CAPTION>
Original Company Name New Company Name Symbol Reorg. Date Consideration
- --------------------- ---------------- ------ ----------- -------------
<S> <C> <C> <C> <C>
Opell, Inc. Wall Street Group OPLL 11/96 18,000 shares (1)
Triple Chip Systems, Inc. Miller Services, Inc. MILL 12/96 44,634 shares (1)
41,417 shares (2)
Summa Vest, Inc. Advanced Voice AVRI 12/96 92,200 shares (2)
Recognition, Inc.
React Systems, Inc. Infrastructure none 9/10/96 - 0 -
International, Inc.
Jungle Street, Inc. Jungle Street, Inc. JUNS 9/1/96 450,000 shares (2)
Nevada Resource Technology TCP Reliable, Inc. TCPN 1/96 - 0 -
T.W.A.R., Inc. Len-Tec none 9/28/94 - 0 -
Unix Source America, Inc. Man Sang Holdings, Inc. MSHI 1/9/96 15,000 shares (1)
Verazzana Ventures, Ltd. Pacific Aerospace and PCTH 1/13/95 100,000 shares (1)
Electronics, Inc. 112,000 shares (2)
Westcott Financial Entertainment ETPI 4/14/95 254,294 shares (1)
Technologies and
Programs, Inc.
Onasco Companies, Inc. Tengasco, Inc. TNGO 5/2/95 52,500 shares (3)
(1) These shares are "unregistered" and "restricted."
(2) These shares were issued pursuant to a Registration Statement on Form S-8.
(3) These "unregistered" and "restricted" shares were issued pursuant to Rule 701 of the
Securities and Exchange Commission.
Nick Lovato, Vice President and Director. Other than the Company, Mr.
Lovato was an Officer and Director of Sun Tech Enterprises, a Nevada
Corporation, from May 4, 1996 until his resignation was accepted by the Board of
Directors on May 15, 1996. Other than the aforementioned, Mr. Lovato has been
neither an Officer, Director or affiliate of any other public companies in the
past 10 years. Mr. Lovato received no consideration in connection with his
service with Sun Tech Enterprises or its subsequent merger with MedTrak Electronics.
Kirsten Lovato, Secretary, Treasurer and Director. Other than the Company,
Mrs. Lovato was an Officer and Director of Sun Tech Enterprises, a Nevada
Corporation, from May 4, 1996 until her resignation was accepted by the
Board of Directors on May 15, 1996. Other than the aforementioned, Mrs. Lovato
was neither an Officer, Director or affiliate of any other public companies in
the past 10 years. Ms. Lovato received no consideration in connection with her
service with Sun Tech Enterprises or its subsequent merger with MedTrak Electronics.
Risk Factors.
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The Company's auditor, Mantyla, McReynolds & Associates, has included a
"going concern" paragraph in the Company's audited financials for the year
ending December 31, 1996. The auditor states: "The accompanying financial
statements have been prepared assuming that National Air Corporation will
continue as a going concern. As discussed in note 2 to the financial statements,
the Company has accumulated losses from operations, has no assets, and has a net
working capital deficiency that raise substantial doubt about its ability to
continue as a going concern. Management's plans in regard to these matters are
also described in note 2. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty." See the
Index to Financial Statements, Part F/S herein.
In any business venture, there are substantial risks specific to the
particular enterprise and which cannot be ascertained until a potential
acquisition, reorganization or merger candidate has been identified; however, at
a minimum, the Company's present and proposed business operations will be highly
speculative and subject to the same types of risks inherent in any new or
unproven venture, and will include those types of risk factors outlined below
and in the initial Offering Circular of the Company, a copy of which is
incorporated herein by this reference as an exhibit to this Registration
Statement on Form 10-SB. See the Exhibit Index, Part III.
No Assets; No Source of Revenue. The Company has no assets and has had no
revenue in either of its two most recent calendar years or to the date hereof.
Nor will the Company receive any revenues until it completes an acquisition,
reorganization or merger, at the earliest. The Company can provide no assurance
that any acquired business will produce any material revenues for the Company or
its stockholders or that any such business will operate on a profitable basis.
Discretionary Use of Proceeds; "Blank Check" Company. Because the Company
is not currently engaged in any substantive business activities, as well as
management's broad discretion with respect to the acquisition of assets,
property or business, the Company may be deemed to be a "blank check" company.
Although management currently has no intentions of raising capital, there are no
guidelines governing the use of such proceeds due to its status as a "blank
check" company.
Absence of Substantive Disclosure Relating to Prospective Acquisitions.
Because the Company has not yet identified any assets, property or business that
it may potentially acquire, potential investors in the Company will have
virtually no substantive information upon which to base a decision whether or
not to invest in the Company. Potential investors would have access to
significantly more information if the Company had already identified a potential
acquisition or if the acquisition target had made an offering of its securities
directly to the public. The Company can provide no assurance that any investment
in the Company will not ultimately prove to be less favorable than such a direct
investment.
Disclosure Relating to Reporting Obligations: Management believes that the
majority of potential acquisition candidates is comprised of companies that are
seeking to report under Regulation 12G. See "Need for any Governmental Approval
of Principal Products and Services".
Upon the effectiveness of its Registration Statement on Form 10-SB,
as amended, on or about August 17, 1997, the Company became subject to the
periodic reporting obligations of Section 13 of the 1934 Act. This Section
requires the Company to file (i) an annual report on Form 10-KSB with the
Securities and Exchange Commission within 90 days of the close of each fiscal
year (Reg. Sections 240.13a-1 and 249.310b); (ii) a quarterly report on Form
10-QSB within 45 days of the end of each of the first three quarters of its
fiscal year (Reg. Sections 240.13a-13 and 249.308b); and (iii) a current
report on Form 8-K within 15 days of the occurrence of certain material events
(e.g., changes in accountants, acquisitions or dispositions of a substantial
amount of assets not in the ordinary course of business) (Reg. Sections
240.13a-11 and 249.308). In addition, annual reports on Form 10-KSB must be
accompanied by audited financial statements as of the end of the issuer's most
recent fiscal year. These reporting requirements may deter potential
reorganization candidates that are not willing to undergo the public and
agency scrutiny resulting therefrom.
Unspecified Industry and Acquired Business; Unascertainable Risks. To date,
the Company has not identified any particular industry or business in which to
concentrate its acquisition efforts. Accordingly, prospective investors
currently have no basis to evaluate the comparative risks and merits of
investing in the industry or business in which the Company may invest. To the
extent that the Company may acquire a business in a highly risky industry, the
Company will become subject to those risks. Similarly, if the Company acquires a
financially unstable business or a business that is in the early stages of
development, the Company will become subject to the numerous risks to which such
businesses are subject. Although management intends to consider the risks
inherent in any industry and business in which it may become involved, there can
be no assurance that it will correctly assess such risks.
Uncertain Structure of Acquisition. Management has had no preliminary
contact or discussions regarding, and there are no present plans, proposals or
arrangements to acquire any specific assets, property or business. Accordingly,
it is unclear whether such an acquisition would take the form of an exchange of
capital stock, a merger or an asset acquisition. However, because the Company
has no resources as of the date of this Registration Statement, management
expects that any such acquisition would take the form of an exchange of capital
stock. See Part I, Item 2 of this Registration Statement.
State Restrictions on "Blank Check" Companies. A total of 36 states
prohibit or substantially restrict the registration and sale of "blank check"
companies within their borders. Additionally, 36 states use "merit review
powers" to exclude securities offerings from their borders in an effort to
screen out offerings of highly dubious quality. See Paragraph 8221, NASAA
Reports, CCH Topical Law Reports, 1990. The Company intends to comply fully with
all state securities laws, and plans to take the steps necessary to ensure that
any future offering of its securities is limited to those states in which such
offerings are allowed. However, these legal restrictions may have a material
adverse impact on the Company's ability to raise capital because potential
purchasers of the Company's securities must be residents of states that permit
the purchase of such securities.
By regulation or policy statement, eight states (Idaho, Maryland, Missouri,
Nevada, New Mexico, Pennsylvania, Utah and Washington), some of which are
included in the group of 36 states mentioned above, place various restrictions
on the sale or resale of equity securities of "blank check" or "blind pool"
companies. These restrictions include, but are not limited to, heightened
disclosure requirements, exclusion from "manual listing" registration exemptions
for secondary trading privileges and outright prohibition of public offerings of
such companies.
In most jurisdictions, "blank check" and "blind pool" companies are not
eligible for participation in the Small Corporate Offering Registration ("SCOR")
program, which permits an issuer to notify the Securities and Exchange
Commission of certain offerings registered in such states by filing a Form D
under Regulation D of the Securities and Exchange Commission. All states (with
the exception of Alabama, Delaware, Florida, Hawaii, Illinois, Minnesota,
Nebraska and New York) have adopted some form of SCOR. States participating in
the SCOR program also allow applications for registration of securities by
qualification by filing a Form U-7 with the states' securities commissions.
Nevertheless, the Company does not anticipate making any SCOR offering or other
public offering in the foreseeable future, even in any jurisdiction where it may
be eligible for participation in SCOR despite its status as a "blank check" or
"blind pool" company. The National Securities Markets Improvement Act of 1996
provides an exemptin from state regulation of offerings of "covered securities".
"Covered Securities" include, among other things, transactions by persons other
than issuers, underwriters or dealers, and certain transactions by dealers, in
securities of issuers that file reports with the Securities and Exchange
Commission pursuant to Section 13 or 15(d) of the Exchange Act. Upon the
effectiveness of this Registration Statement, the Company will be subject to the
reporting requirements of Section 13 of the Exchange Act, and management
believes that such transactions will be exempt from state regulation, with the
possible exception of certain notice filings and payment of fees.
The net effect of the above-referenced laws, rules and regulations will be
to place significant restrictions on the Company's ability to register, offer
and sell shares of the Company's common stock in virtually every jurisdiction in
the United States.
Management to Devote Insignificant Time to Activities of the Company.
Members of the Company's management are not required to devote their full time
to the affairs of the Company. Because of their time commitments, as well as the
fact that the Company has no business operations, the members of management
anticipate that they will devote an insignificant amount of time to the
activities of the Company, at least until such time as the Company has
identified a suitable acquisition target.
Conflicts of Interest; Related Party Transactions. Although the Company has
not identified any potential acquisition target, the possibility exists that the
Company may acquire or merge with a business or company in which the Company's
executive officers, directors, beneficial owners or their affiliates may have an
ownership interest. Such a transaction may occur if management deems it to be in
the best interests of the Company and its stockholders, after consideration of
the above referenced factors. A transaction of this nature would present a
conflict of interest to those parties with a managerial position and/or an
ownership interest in both the Company and the acquired entity, and may
compromise management's fiduciary duties to the Company's stockholders. An
independent appraisal of the acquired company may or may not be obtained in the
event a related party transaction is contemplated. Furthermore, because
management and/or beneficial owners of the Company's common stock may be
eligible for finder's fees or other compensation related to potential
acquisitions by the Company, such compensation may become a factor in
negotiations regarding such potential acquisitions.
Voting Control. Due to his beneficial ownership of a majority of the shares
of the Company's outstanding common stock, Jeff D. Jenson has the ability to
elect all of the Company's directors, who in turn elect all executive officers,
without regard to the votes of other stockholders.
No Market for Common Stock; No Market for Shares. The Company's common
stock is not currently listed on the OTC Bulletin Board of the National
Association of Securities Dealers, Inc., (the "NASD"), and has not been listed
on the aforementioned market for the previous five years. Therefore, there is
currently no "established trading market" for such shares; there can be no
assurance that such a market will ever develop or be maintained. Any future
market price for shares of common stock of the Company is likely to be very
volatile, and numerous factors beyond the control of the Company may have a
significant effect. In addition, the stock markets generally have experienced,
and continue to experience, extreme price and volume fluctuations which have
affected the market price of many small capital companies and which have been
unrelated to the operating performance of these companies. These broad market
fluctuations, as well as general economic and political conditions, may
adversely affect the market price of the Company's common stock in any market
that may develop.
Risks of "Penny Stock." The Company's common stock may be deemed to be
"penny stock" as that term is defined in Reg. Section 240.3a51-1 of the
Securities and Exchange Commission. Penny stocks are stocks (i) with a price of
less than five dollars per share; (ii) that are not traded on a "recognized"
national exchange; (iii) whose prices are not quoted on the NASDAQ automated
quotation system (NASDAQ-listed stocks must still meet requirement (i) above);
or (iv) is an issuer with net tangible assets less than $2,000,000 (if the
issuer has been in continuous operation for at least three years) or $5,000,000
(if in continuous operation for less than three years), or with average revenues
of less than $6,000,000 for the last three years.
There has been no "established public market" for the Company's common
stock during the past five years. At such time as the Company completes a merger
or acquisition transaction, if at all, it may attempt to qualify for listing on
either NASDAQ or a national securities exchange. However, at least initially,
any trading in its common stock will most likely be conducted in the
over-the-counter market in the "pink sheets" or the "Electronic Bulletin Board"
of the National Association of Securities Dealers, Inc. (the "NASD").
Section 15(g) of the Securities Exchange Act of 1934, as amended, and Reg.
Section 240.15g-2 of the Securities and Exchange Commission require
broker-dealers dealing in penny stocks to provide potential investors with a
document disclosing the risks of penny stocks and to obtain a manually signed
and dated written receipt of the document before effecting any transaction in a
penny stock for the investor's account. Potential investors in the Company's
common stock are urged to obtain and read such disclosure carefully before
purchasing any shares that are deemed to be "penny stock."
Moreover, Reg. Section 240.15g-9 of the Securities and Exchange Commission
requires broker-dealers in penny stocks to approve the account of any investor
for transactions in such stocks before selling any penny stock to that investor.
This procedure requires the broker-dealer to (i) obtain from the investor
information concerning his or her financial situation, investment experience and
investment objectives; (ii) reasonably determine, based on that information,
that transactions in penny stocks are suitable for the investor and that the
investor has sufficient knowledge and experience as to be reasonably capable of
evaluating the risks of penny stock transactions; (iii) provide the investor
with a written statement setting forth the basis on which the broker-dealer made
the determination in (ii) above; and (iv) receive a signed and dated copy of
such statement from the investor, confirming that it accurately reflects the
investor's financial situation, investment experience and investment objectives.
Compliance with these requirements may make it more difficult for investors in
the Company's common stock to resell their shares to third parties or to
otherwise dispose of them.
Principal Products and Services.
- --------------------------------
The limited business operations of the Company, as now contemplated,
involve those of a "blank check" company. The only activity to be conducted by
the Company is to seek out and investigate the acquisition of any viable
business opportunity by purchase and exchange for securities of the Company or
pursuant to a reorganization or merger through which securities of the Company
will be issued or exchanged.
Distribution Methods of the Products or Services.
- -------------------------------------------------
Management will seek out and investigate business opportunities through
every reasonably available fashion, including personal contacts, professionals,
securities broker dealers, venture capital personnel, members of the financial
community and others who may present unsolicited proposals; the Company may also
advertise its availability as a vehicle to bring a company to the public market
through a "reverse" reorganization or merger.
Status of any Publicly Announced New Product or Service.
- --------------------------------------------------------
None; Not applicable.
Competitive Business Conditions.
- ---------------------------------------
There are literally thousands of "blank check" companies engaged in
endeavors similar to those engaged in by the Company; many of these companies
have substantial current assets and cash reserves. Competitors also include
thousands of other publicly-held companies whose business operations have proven
unsuccessful, and whose only viable business opportunity is that of providing a
publicly-held vehicle through which a private entity may have access to the
public capital markets. There is no reasonable way to predict the competitive
position of the Company or any other entity in the strata of these endeavors;
however, the Company, having no assets and no cash reserves, will no doubt be at
a competitive disadvantage in competing with entities which have recently
completed IPO's, have cash resources and have limited operating histories when
compared with the history and past failures of the Company.
Sources and Availability of Raw Materials and Names of Principal Suppliers.
- --------------------------------------------------------------------------------
None; Not applicable.
Dependence on One or a Few Major Customers.
- --------------------------------------------------------
None; Not applicable.
Patents, Trademarks, Licenses, Franchises, Concessions, Royalty Agreements
or Labor Contracts.
- --------------------------------------------------------------------------------
None; Not applicable.
Need for any Governmental Approval of Principal Products or Services.
- --------------------------------------------------------------------------------
On the effectiveness of the Company's Registration Statement on Form 10-SB,
the Company became subject to Regulation 14A regarding proxy solicitations
promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended (the "1934 Act"). Section 14(a) of the 1934 Act
requires all companies with securities registered pursuant to Section 12(g)
thereof to comply with the rules and regulations of the Securities and Exchange
Commission regarding proxy solicitations outlined in Regulation 14A. Matters
submitted to stockholders of the Company at a special or annual meeting thereof
or pursuant to a written consent shall require the Company to provide its
stockholders with the information outlined in Schedules 14A or 14C of Regulation
14; preliminary copies of this information must be submitted to the Securities
and Exchange Commission at least 10 days prior to the date that definitive
copies of this information are forwarded to stockholders.
Management intends to conduct a full evaluation of the worthiness of any
business proposal presented to it; nonetheless, it believes this process may
provide additional time within which to evaluate any business proposal presented
to it, and may eliminate proposals from entities not willing to undergo the
public and agency scrutiny involved in providing and filing information required
under Regulation 14A. Management recognizes that this filing process may deter
other potential business venturers by reason of their inability to predict the
timeliness of their potential acquisition, reorganization or merger due to the
uncertainty related to the time involved in reviewing Regulation 14A filings by
the Securities and Exchange Commission; however, acquisitions or reorganizations
not requiring stockholder approval may be completed by management, in its sole
discretion, with the submission by management of an Information Statement
pursuant to Regulation 14C outlining any remedial proposals attendant to any
such acquisition or reorganization, including changing the name of the Company
or increasing or decreasing the number of authorized or outstanding shares of
the Company's common stock.
The Company is also subject to the periodic reporting obligations imposed by
Section 13 of the 1934 Act, including the obligations to file the following
documents in a timely manner: Form 10-KSB Annual Reports (due 90 days after the
end of every fiscal year); Form 10-QSB Quarterly Reports (due 45 days after the
end of the first three quarters of every fiscal year); and Current Reports on
Form 8-K (due 15 days after the occurrence of certain material events
(e.g., changes in accountants, acquisitions or dispositions of a substantial
amount of assets not in the ordinary course of business). See the heading
"Disclosure Relating to Reporting Obligations" of the caption "Risk Factors" of
this Registration Statement.
Prior to the completion of any merger or acquisition transaction, costs
associated with filings required by the Company under Section 13 of the 1934
Act and Regulation 14A of the Securities and Exchange Commission will have to be
advanced by management, the Company's principal stockholders or any potential
business venturer, and may further dilute the interest of the public
stockholders. In the case of a merger requiring prior stockholder approval and
the submission of financial statements of the Company and other party or parties
to the merger, legal and accounting costs will be significantly higher, even
though the adoption, ratification and the approval of any such merger will be
virtually assured if recommended by Jeff D. Jenson, the principal stockholder of
the Company.
Effect of Existing or Probable Governmental Regulations on Business.
- --------------------------------------------------------------------------------
Since the Company was initially incorporated, federal and state securities
laws, rules and regulations have made the participation in or the conducting of
an IPO substantially easier for certain small and developmental stage companies,
reducing the time constraints previously involved, the legal and accounting
costs and the financial periods required to be included in the financial
statements. Rule 504 of Regulation D of the Securities and Exchange Commission
no longer requires the filing of a Registration Statement with any state or
territory as a condition to its use; however, this Rule is no longer available
to "blank check" companies. Accordingly, because the Company is presently deemed
to be a "blank check" company, this method of raising funds is foreclosed to it.
Rule 504 is also not available to "reporting issuers," which the Company will
become on the effectiveness of this Registration Statement.
The integrated disclosure system for small business issuers adopted by the
Securities and Exchange Commission in Release No. 34-30968 and effective as of
August 13, 1992, substantially modified the information and financial
requirements of a "Small Business Issuer," defined to be an issuer that has
revenues of less than $25 million; is a U.S. or Canadian issuer; is not an
investment company; and if a majority owned subsidiary, the parent is also a
small business issuer; provided, however, an entity is not a small business
issuer if it has a public float (the aggregate market value of the issuer's
outstanding securities held by non-affiliates) of $25 million or more.
A number of state securities commissions have adopted the use of Form U-7
for SCOR, which also substantially simplifies the registration process for
IPO's; Form U-7 is primarily used in connection with offerings conducted
pursuant to Rule 504 of the Securities and Exchange Commission, but is not
limited to this use. To the extent that Rule 504 and the use of SCOR are
unavailable to the Company due to its status as a "blank check" company, the use
of Form U-7 will also be unavailable in this regard.
The Securities and Exchange Commission, state securities commissions and
the North American Securities Administrators Association, Inc., ("NASAA") have
expressed an interest in adopting policies that will streamline the registration
process and make it easier for a small business issuer to have access to the
public capital markets. The present laws, rules and regulations designed to
promote availability for the small business issuer to these capital markets and
similar laws, rules and regulations that may be adopted in the future will
substantially limit the demand for "blank check" companies like the Company, and
may make the use of these companies obsolete.
Research and Development.
- ---------------------------------
None; Not applicable.
Cost and Effects of Compliance with Environmental Laws.
- ---------------------------------------------------------------------
None; Not applicable. However, environmental laws, rules and regulations
may have an adverse effect on any business venture viewed by the Company as an
attractive acquisition, reorganization or merger candidate, and these factors
may further limit the number of potential candidates available to the Company
for acquisition, reorganization or merger.
Number of Employees.
- --------------------------
None; Not Applicable.
Item 2. Management's Discussion and Analysis or Plan of Operation.
- --------------------------------------------------------------------------------
Plan of Operation.
- ---------------------
The Company has not engaged in any material operations or had any revenues
from operations during the last four calendar years. The Company's plan of
operation for the next 12 months is to continue to seek the acquisition of
assets, property or business that may benefit the Company and its stockholders.
Because the Company has no resources, management anticipates that to achieve any
such acquisition, the Company will be required to issue shares of its common
stock as the sole consideration for such acquisition.
During the next 12 months, the Company's only foreseeable cash requirements
will relate to maintaining the Company in good standing or the payment of
expenses associated with reviewing or investigating any potential business
venture, which may be advanced by management or principal stockholders as loans
to the Company. Because the Company has not identified any such venture as of
the date of this Registration Statement, it is impossible to predict the amount
of any such loan. However, any such loan will not exceed $25,000 and will be on
terms no less favorable to the Company than would be available from a commercial
lender in an arm's length transaction. As of the date of this Registration
Statement, the Company has not begun seeking any acquisition.
Because the Company is not currently making any offering of its securities,
and does not anticipate making any such offering in the foreseeable future,
management does not believe that Rule 419 promulgated by the Securities and
Exchange Commission under the Securities Act of 1933, as amended, concerning
offerings by blank check companies, will have any effect on the Company or any
activities in which it may engage in the foreseeable future.
Item 3. Description of Property.
- -------------------------------------
The Company has no assets, property or business; its principal executive
office address and telephone number are the business office address and
telephone number of its President, Director, and principal shareholder, Jeff D.
Jenson, and are provided at no cost. Because the Company has no business, its
activities have been limited to keeping itself in good standing in the State of
Nevada and, recently, with preparing this Registration Statement and the
accompanying financial statements. These activities have consumed an
insignificant amount of management's time; accordingly, the costs to Mr. Jenson
of providing the use of his office and telephone have been minimal.
Item 4. Security Ownership of Certain Beneficial Owners and Management.
- --------------------------------------------------------------------------------
Security Ownership of Certain Beneficial Owners.
The following table sets forth the shareholdings of those persons who own
more than five percent of the Company's common stock as of May 1, 1997:
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Number Percentage
Name and Address of Shares Beneficially Owned of Class
- ---------------------- ----------------------------------- --------
Michael Caswell 52,500 7%
3637 W. Alabama, Ste. 400
Houston, TX 77027
Jenson Services, Inc.* 400,000 54%
5525 S. 900 E. Suite 110
S.L.C., UT 84117
Jeff D. Jenson 12,500 1.6%
5525 S. 900 E. Suite 110
S.L.C., UT 84117
</TABLE>
*Jeff D. Jenson, President and Director may be deemed a beneficial owner of
these shares due to his current position as Vice-President and Director of
Jenson Services, Inc. (Distribution of ownership; Jeff D. Jenson and Duane S.
Jenson, 50% each).
Security Ownership of Management.
- ---------------------------------
The following table sets forth the shareholdings of the Company's directors
and executive officers as of May 1, 1997.
<TABLE>
<CAPTION>
Number Percentage
Name and Address of Shares Beneficially Owned of Class
- ---------------------- ----------------------------------- ----------
<S> <C> <C>
Jeff D. Jenson 12,500 1.7%
5525 S. 900 E. #110
S.L.C., UT 84117
Jenson Services, Inc. 400,000 54%
Jeff D. Jenson*
5525 S. 900 E. #110
S.L.C., UT
Nick Lovato 0 0
8667 Snow Mountain Dr.
Sandy, Utah 84093
Kirsten Lovato 0 0
8667 Snow Mountain Dr.
Sandy, Utah 84093
All directors and executive 412,500 56%
officers as a group (3)
</TABLE>
*Jeff D. Jenson, President and Director may be deemed a beneficial owner of
these shares due to his current position as Vice-President and Director of
Jenson Services, Inc. (Distribution of ownership; Jeff D. Jenson and Duane S.
Jenson, 50% each).
See Item 5, Part I, below, for information concerning the offices or other
capacities in which the foregoing persons serve with the Company.
Changes in Control.
- -------------------
There are no present arrangements or pledges of the Company's securities
which may result in a change in control of the Company.
Item 5. Directors, Executive Officers, Promoters and Control Persons.
- --------------------------------------------------------------------------------
Identification of Directors and Executive Officers.
- ---------------------------------------------------
The following table sets forth the names of all current directors and
executive officers of the Company. These persons will serve until the next
annual meeting of the stockholders (held in December of each year) or until
their successors are elected or appointed and qualified, or their prior
resignation or termination.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Date of Date of
Positions Election or Termination
Name Held Designation or Resignation
- ------- ---------- --------------- ---------------
Jeff D. Jenson President 04-19-95 *
5525 S. 900 E. #110 & Director
S.L.C., UT 84117
Nick Lovato Vice President 05-04-96 *
8667 S. Snow Mtn. Dr. & Director
Sandy, UT 84093
Kirsten Lovato Secretary/ 05-04-96 *
8667 S. Snow Mtn. Dr. Treasurer
Sandy, UT 84093 & Director
</TABLE>
* These persons presently serve in the capacities indicated.
Business Experience.
- ------------------------
Jeff D. Jenson, President and Director. Mr. Jenson graduated form
Westminster College of Salt Lake City in September 1992, with degrees in
Business Management and Aviation Management. Prior to his graduation, Mr. Jenson
was the owner/operator of two small businesses in the Salt Lake area. Mr. Jenson
has been employed by Jenson Services from 1991 until present. In March 1993, Mr.
Jenson became Vice President and Director of Jenson Services. Jenson Services
specializes in the reorganization and recapitalization of public companies and
is a consultant to the Company.
Nick Lovato, Vice-President and director. Mr. Lovato graduated from the
University of Utah in June 1992, with a B.A. in Political Science. Prior to his
graduation, Mr. Lovato served as an Policy Intern with the United States Senate
in Washington DC. From May 1993 to August 1994, Mr. Lovato served as an Loan
Officer/Assistant Manager for Transamerica Financial and from August 1994 to
July 1995 was an Senior Loan Officer/Assistant Treasurer for American Investment
Bank, both companies are located in Salt Lake City, Utah. Currently, Mr. Lovato
is a Senior Underwriter for Franklin Capital Corporation, also of Salt Lake.
Kirsten Lovato, Secretary, Treasurer and Director. Mrs. Lovato graduated
from the University of Iowa in 1993 with a B.S. in Dental Hygiene. Mrs. Lovato
also attended the University of Utah and Salt Lake Community College. From July
1993 until present, Mrs. Lovato has worked as a dental hygienist in the greater
Salt Lake City area.
Significant Employees.
- ----------------------
The Company has no employees who are not executive officers, but who are
expected to make a significant contribution to the Company's business.
Family Relationships.
- ---------------------
Nick Lovato and Kirsten Lovato, Vice-President and Director and Secretary,
Treasurer and Director, respectively, are husband and wife. Other than the
aforementioned, there are no family relationships among the officers and
directors of the Company.
Involvement in Certain Legal Proceedings.
- -----------------------------------------
During the past five years, no present or former director, executive
officer or person nominated to become a director or an executive officer of the
Company:
(1) was a general partner or executive officer of any business against
which any bankruptcy petition was filed, either at the time of the bankruptcy or
two years prior to that time;
(2) was convicted in a criminal proceeding or named subject to a pending
criminal proceeding (excluding traffic violations and other minor offenses);
(3) was subject to any order, judgment or decree, not subsequently
reversed, suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or otherwise limiting
his involvement in any type of business, securities or banking activities; or
(4) was found by a court of competent jurisdiction (in a civil action), the
Securities and Exchange Commission or the Commodity Futures Trading Commission
to have violated a federal or state securities or commodities law, and the
judgment has not been reversed, suspended or vacated.
Item 6. Executive Compensation.
- ---------------------------------------
The following table sets forth the aggregate compensation paid by the
Company for services rendered during the periods indicated:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
<S> <C> <C> <C> <C> <C> <C> <C>
<C>
Long Term Compensation
Annual Compensation Payouts
(a) (b) (c) (d) (e) (f) (g) (h)
(i)
Name and Years or Other Restricted Option/ LTIP All
Principal Periods $ Annual Stock SAR's Payouts Other
Position Ended Salary Bonus Compen- Awards ($) (#) ($) Compensa-
1994, sation($) tion
1995 &
1996
- --------- -------- ------ ----- ------- ----------- ------ ----- -----
Jeff D. Jenson 12/31/94 0 0 0 0 0 0 0
President, 12/31/95 0 0 0 12,500* 0 0 0
Director 12/31/96 0 0 0 0 0 0 0
Nick Lovato 12/31/94 0 0 0 0 0 0 0
Vice Pres., 12/31/95 0 0 0 0 0 0 0
Director 12/31/96 0 0 0 0 0 0 0
Kirsten Lovato 12/31/94 0 0 0 0 0 0 0
Sec./Treas., 12/31/95 0 0 0 0 0 0 0
Director 12/31/96 0 0 0 0 0 0 0
</TABLE>
*Reflects a one for 20 (1:20) reverse split of the Company's common stock
effective July 14, 1996. See Part I, Item 1 of this Registration Statement.
No cash compensation, deferred compensation or long-term incentive plan
awards were issued or granted to the Company's management during the calendar
years ended December 31, 1996, or 1995, or the period ending on the date of this
Registration Statement. Further, no member of the Company's management has been
granted any option or stock appreciation right; accordingly, no tables relating
to such items have been included within this Item.
Compensation of Directors.
- --------------------------
There are no standard arrangements pursuant to which the Company's
directors are compensated for any services provided as director. No additional
amounts are payable to the Company's directors for committee participation or
special assignments.
There are no arrangements pursuant to which any of the Company's directors
was compensated during the Company's last completed calendar year for any
service provided as director.
Employment Contracts and Termination of Employment and Change-in-Control
Arrangements.
- --------------------------------------------------------------------------------
There are no employment contracts, compensatory plans or arrangements,
including payments to be received from the Company, with respect to any director
or executive officer of the Company which would in any way result in payments to
any such person because of his or her resignation, retirement or other
termination of employment with the Company or its subsidiaries, any change in
control of the Company, or a change in the person's responsibilities following a
change in control of the Company.
Item 7. Certain Relationships and Related Transactions.
- --------------------------------------------------------
Transactions with Management and Others.
- ----------------------------------------
There have been no material transactions, series of similar transactions,
currently proposed transactions, or series of similar transactions, to which the
Company or any of its subsidiaries was or is to be a party, in which the amount
involved exceeded $60,000 and in which any director or executive officer, or any
security holder who is known to the Company to own of record or beneficially
more than five percent of the Company's common stock, or any member of the
immediate family of any of the foregoing persons, had a material interest.
However, on October 26, 1996, the Board of Directors of the Company resolved to
issue 400,000 post-split "unregistered" and "restricted" shares of common stock
to Jenson Services, Inc., a consultant to the Company, in consideration of
$2,557.25 in accounting and other expenses incurred by the Company and settled
by Jenson Services, Inc. Jeff D. Jenson, President and Director may be deemed a
beneficial owner of these shares due to certain business relationships. Mr.
Jenson is Vice-President and Director of Jenson Services, Inc. See Part I, Item
1 and Part II, Item 4 of this Registration Statement.
Certain Business Relationships.
- -------------------------------
Except as stated under the caption "Transactions with Management and
Others", above, there have been no material transactions, series of similar
transactions, currently proposed transactions, or series of similar
transactions, to which the Company or any of its subsidiaries was or is to be a
party, in which the amount involved exceeded $60,000 and in which any director
or executive officer, or any security holder who is known to the Company to own
of record or beneficially more than five percent of the Company's common stock,
or any member of the immediate family of any of the foregoing persons, had a
material interest. However, see Part I, Item 1 of this Registration Statement.
Indebtedness of Management.
- ---------------------------
Except as stated under the caption "Transactions with Management and
Others", above, there have been no material transactions, series of similar
transactions, currently proposed transactions, or series of similar
transactions, to which the Company or any of its subsidiaries was or is to be a
party, in which the amount involved exceeded $60,000 and in which any director
or executive officer, or any security holder who is known to the Company to own
of record or beneficially more than five percent of the Company's common stock,
or any member of the immediate family of any of the foregoing persons, had a
material interest. However, see Part I, Item 1 of this Registration Statement.
Parents of the Issuer.
- ----------------------
The Company has no parents, except to the extent that Jeff D. Jenson, the
principal stockholder, due to beneficial ownership, may be deemed to be a parent
of the Company. See Part I, Item 1 of this Registration Statement.
Transactions with Promoters.
- ----------------------------
Except as stated under the caption "Transactions with Management and
Others, above, there have been no material transactions, series of similar
transactions, currently proposed transactions, or series of similar
transactions, to which the Company or any of its subsidiaries was or is to be a
party, in which the amount involved exceeded $60,000 and in which any promoter
or founder, or any member of the immediate family of any of the foregoing
persons, had a material interest. See Part I, Item 1 and Part II, Item 4 of this
Registration Statement.
Item 8. Description of Securities.
- -----------------------------------
The amount of the total authorized capital stock of the Company is Twenty
Million (20,000,000) shares of common stock with a par value of one tenth of one
cent ($0.001) per share; one million (1,000,000) shares of Class A Preferred
tock with a par value of twenty five cents ($0.25) per share each with
designations, preferences, limitations and relative rights, and one million
(1,000,000) shares of Class B Preferred Stock with a par value of ten cents
($0.10) per share each with designations, preferences, limitations and relative
rights. A summary description of the Class A and Class B Preferred stock is
included as follows. For a detailed description of these securities as described
in the Certificate of Amendment of Articles of Incorporation of the Company, see
Part III, Item 1, Exhibit 3.2 of this Registration Statement.
(1) Liquidation Preference.
In the event of voluntary or involuntary liquidation of the
corporation, the holders of the Class A and Class B Preferred Stock, after
payment or provision for payment of debts, but before any distribution of
assets to the holders of Common Stock, at the rate of twenty cents ($.20)
per share plus cumulated and unpaid dividends thereon to the date fixed
for the liquidation. See Part III, Item 1, Exhibit 3.2.
(2) Redemption of Class A Preferred Stock
The Corporation, at the option of the board of directors, upon ten
days prior written notice to the holders of the Class A Preferred Stock,
may redeem all or any part of the Calass A Preferred Stock outstanding as
of the designated date of redemption (10 days after the date of Notice) at
a price of $.001 per share. See Part III, Item 1, Exhibit 3.2.
(3) Redemption of Class B Preferred Stock.
The Corporation, at the option of the board of directors, upon each
anniversary of the issuance of a share of Class B Preferred Stock may
redeem all of the Class B Preferred Stock then outstanding after payment in
cash of all cumulated and uppaid dividends up to the date fixed for
redemption and subject to additional terms as outlined in the Certificate
of Amendment of the Articles of Incorporation. See Part III, Item 1,
Exhibit 3.2.
(4) Voting if Dividends in Arrears.
If at any time the cumulated and unpaid dividends on the Class B
Preferred Stock equal or exceed $.05 a share (two quarterly dividends), the
holders of fifty-one percent (51%) of the Class B Preferred Stock will have
the right immediately to call a special meeting of the shareholders to
elect two directors of the Corporation, subject to approval by a majority
of the board of directors. Such voting rights will terminate only when all
cumulated and unpaid dividends on the then outstanding shares of Class B
Preferred Stock are paid and the full dividends thereon for the then
current quartely dividend period are paid. The directors elected by the
holders of Class B Preferred Stock may be removed only by vote of such
holders so long as their voting rights have not terminated. See Part III,
Item 1, Exhibit 3.2.
According to the Company's Transfer Agent, American Registrar and Transfer,
there has never been any type of capital stock, either issued or outstanding,
other than Common Voting Stock.
Stockholders of the Company have no pre-emptive rights to acquire
additional shares of common stock or other securities. The common stock is not
subject to redemption rights and carries no subscription or conversion rights.
In the event of liquidation of the Company, the shares of common stock are
entitled to share equally in corporate assets after satisfaction of all
liabilities. All shares of the common stock now outstanding are fully paid and
non-assessable.
There are no outstanding options, warrants or calls to purchase any of the
authorized securities of the Company.
There is no provision in the Company's Articles of Incorporation, as
amended, or Bylaws, as amended, that would delay, defer, or prevent a change in
control of the Company.
PART II
Item 1. Market Price of and Dividends on the Company's Common Equity and
Other Stockholder Matters.
- -------------------------------------------
Market Information.
- -----------------------
The Company's common stock is not currently listed on the OTC Bulletin
Board of the NASD or any other recognized securities market. There has been no
trading symbol or "established trading market" for shares of the Company's
common stock during the first two quarters of 1997, or at any point in 1996 or
1995, and management does not expect any such market to develop unless and until
the Company completes an acquisition or merger. In any event, no assurance can
be given that any "established trading market" for the Company's common stock
will develop or be maintained. If such a market ever develops in the future, the
sale of "unregistered" and "restricted" shares of common stock pursuant to Rule
144 of the Securities and Exchange Commission by Michael Caswell, Jeff D. Jenson
or Jenson Services, Inc., may have a substantial adverse impact on any such
public market. See the caption "Business" of Part I, Item 1 of this Registration
Statement.
Future sales of any of these securities or any securities of the Company
issued in any acquisition, reorganization or merger may have a future adverse
effect on any "public market" that may develop in the common stock of the
Company. See Part I, Item 1 of this Registration Statement.
Holders.
- --------
The number of record holders of the Company's common stock as of the date
of this Registration Statement is approximately 81.
Dividends.
- ----------
There have been no cash dividends declared on any class of common equity
for the last two fiscal years or in any subsequent period that required
financial information. The Company has no forseeable dividends.
The holders of the Class B Preferred Stock will be entitled to receive,
when and as declared by the board of directors out of any funds legally
available therefor, cumulative preferential dividends in cash. Except as
otherwise provided herein such dividends will be paid at the annual rate of, but
not exceeding, $.10 per share, payable quarterly on November 30, February 28,
May 31 and August 31 in each year. Such dividends shall accrue on each share
from day to day from and after the date of initial issuance of such share
whether or not declared, and shall be cumulative so that if any accrued
dividends at said rate per share per annum shall not have been paid or declared
and set apart for all shares' of Class B preferred Stock at the time
outstanding, the deficiency shall be fully paid on or declared and set apart for
such shares before the Corporation declares or pays any dividends (except a
dividend in shares of the Corporation) on the Class A Preferred Stock or Common
Stock of the Corporation. As verified by the Company's Transfer Agent, American
Registrar and Transfer, the Company does not have any shares of its Class A or
Class B Preferred stock either issued or outstanding.
Item 2. Legal Proceedings.
- ---------------------------
The Company is not a party to any pending legal proceeding. No federal,
state or local governmental agency is presently contemplating any proceeding
against the Company. No director, executive officer or affiliate of the Company
or owner of record or beneficially of more than five percent of the Company's
common stock is a party adverse to the Company or has a material interest
adverse to the Company in any proceeding.
To date, Jenson Services, Inc. has provided all Company loans totaling
approximately $6,000. Management does not believe that the Company will incur an
additional $19,000 worth of expenses before entering into a merger or
acquisition. If the company does need additional funding, such funding will be
sought through an arms length transaction with a banking institution.
Item 3. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
- -----------------------------------
Not Applicable; The Company's relationship with Mantyla, McReynolds &
Associates, Certified Public Accountants, of Salt Lake City, Utah, has not
changed. Prior to the engagement of Mantyla , McReynolds & Associates, the
Company had no independant auditor for approximately 12 years. For the auditor's
going-concern opinion, see the Auditor's Opinion letter in the F/S and the
Section "Risk Factors".
Item 4. Recent Sales of Unregistered Securities.
- -------------------------------------------------
On April 25, 1995, the Board of Directors resolved to issue 12,500* shares
of "unregistered" and "restricted" common voting stock to Jeff D. Jenson,
President and Director, Jason Lewis, Vice President and Director and Wendy
Moler-Lewis, Secretary, Treasurer and Director, for services rendered to the
Comopany. On October 26, 1996, the Company's Board of Directors unanimously
voted to issue 400,000* "unregistered" and "restricted" shares of common stock
to Jenson Services, Inc., in consideration of $2,577.25 in accounting and other
expenses incurred by the Company and settled by Jenson. See Part I, Item 1 of
this Registration Statement. *These shares are represented in post-split values.
Management believes that Jenson Services, Inc. is an "accredited investor"
as that term is defined under applicable federal and state securities laws,
rules and regulations. Further, the Board of Directors and Jenson Services,
Inc., a consultant to the Company, had access to all material information
regarding the Company prior to the offer or sale of these securities. The offers
and sales of these securities are believed to have been exempt from the
registration requirements of Section 5 of the Securities Act of 1933 pursuant to
Section 4(2) thereof, and from similar states' securities laws, rules and
regulations requiring the offer and sale of securities by available state
exemptions from such registration.
Item 5. Indemnification of Directors and Officers.
- ----------------------------------------------------------
The Company's Officers and Directors are indemnified to the extent that the
applicable laws allow, as summarized below:
Section 78.751(1) of the Nevada Revised Statutes ("NRS") authorizes a
Nevada corporation to indemnify any director, officer, employee, or corporate
agent "who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, except an action by or in the right
of the corporation" due to his or her corporate role. Section 78.751(1) extends
this protection "against expenses, including attorneys' fees, judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with the action, suit or proceeding if he acted in good faith and in
a manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful."
Section 78.751(2) of the NRS also authorizes indemnification of the
reasonable defense or settlement expenses of a corporate director, officer,
employee or agent who is sued, or is threatened with a suit, by or in the right
of the corporation. The party must have been acting in good faith and with the
reasonable belief that his or her actions were not opposed to the corporation's
best interests. Unless the court rules that the party is reasonably entitled to
indemnification, the party seeking indemnification must not have been found
liable to the corporation.
To the extent that a corporate director, officer, employee, or agent is
successful on the merits or otherwise in defending any action or proceeding
referred to in Section 78.751(1) or 78.751(2), Section 78.751(3) of the NRS
requires that he or she be indemnified "against expenses, including attorneys"
fees, actually and reasonably incurred by him in connection with the defense."
Section 78.751(4) of the NRS limits indemnification under Sections
78.751(1) and 78.751(2) to situations in which either (i) the stockholders; (ii)
the majority of a disinterested quorum of directors; or (iii) independent legal
counsel determine that indemnification is proper under the circumstances.
Pursuant to Section 78.751(5) of the NRS, the corporation may advance an
officer's or director's expenses incurred in defending any action or proceeding
upon receipt of an undertaking. Section 78.751(6)(a) provides that the rights to
indemnification and advancement of expenses shall not be deemed exclusive of any
other rights under any bylaw, agreement, stockholder vote or vote of
disinterested directors. Section 78.751(6) extends the rights to indemnification
and advancement of expenses to former directors, officers, employees and agents,
as well as their heirs, executors, and administrators.
Regardless of whether a director, officer, employee or agent has the right
to indemnity, Section 78.752 allows the corporation to purchase and maintain
insurance on his or her behalf against liability resulting from his or her
corporate role.
Article XI of the Company's Bylaws provides for the mandatory
indemnification and reimbursement of any director or executive officer for
actions or omissions in such capacity, except for claims or liabilities arising
out of his or her own negligence or willful misconduct.
PART F/S
Index to Financial Statements
Report of Certified Public Accountants
Financial Statements
- --------------------
(i) Audited Financial Statements
December 31, 1996 and 1995
--------------------------
Independent Auditors' Report
Balance Sheet, December 31, 1996 and 1995
Statements of Stockholders' Deficit
for the years ended December 31, 1996
and 1995
Statements of Operations for the
years ended December 31, 1996 and
1995
Statements of Cash Flows for the
years ended December 31, 1996 and
1995
Notes to Financial Statements
(ii) Unaudited Financial Statements
April 30, 1997
-----------------
Balance Sheet, April 30, 1997
Statements of Operations
for the four months ended April 30, 1997
Statements of Cash Flows for the
four months ended April 30, 1997
PART III
Item 1. Index to Exhibits.
- -------------------------------
The following exhibits are filed as a part of this Registration Statement:
<TABLE>
<CAPTION>
Exhibit
Number Description*
- ------ ------------
<S> <C>
3.1 Articles of Incorporation,
filed on January 15, 1985*
3.2 Certificate of Amendment of Articles of
Incorporation, filed on September 26, 1985*
3.3 Bylaws*
4 Original Offering Circular* (Exhibits to the Original Offering
Circular are not included but are available upon request)
</TABLE>
* Exhibits referenced within this Registration Statement are incorporated
in the Form 10-SB as filed on June 17,1997.
SIGNATURES
In accordance with Section 12 of the Securities
Exchange Act of 1934, the Registrant has caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto
duly authorized.
NATIONAL AIR CORPORATION
Date: 2/11/98 By /s/ Jeff D. Jenson
---------------- ------------------------
Jeff D. Jenson, Director
and President
Date: 2/11/98 By /s/ Nick Lovato
---------------- ------------------------
Nick Lovato,
Director and Vice
President
Date: 2/11/98 By /s/ Kirsten Lovato
---------------- ------------------------
Kirsten Lovato,
Director and
Secretary/Treasurer
<PAGE>
NATIONAL AIR CORPORATION
FINANCIAL STATEMENTS
December 31, 1996
[WITH INDEPENDENT AUDITORS' REPORT]
<PAGE>
National Air Corporation
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Page
Independent Auditors' Report. . . . . . . . . . . . . 1
Balance Sheet - December 31, 1996 . . . . . . . . . . 2
Statements of Operations for the
years ended December 31, 1996 and
December 31, 1995 . . . . . . . . . . . . . . . . . . 3
Statements of Stockholders' Deficit for
the years ended December 31, 1996 and
December 31, 1995 . . . . . . . . . . . . . . . . . . 4
Statements of Cash Flows for the
years ended December 31, 1996 and
December 31, 1995 . . . . . . . . . . . . . . . . . . 5
Notes to Financial Statements . . . . . . . . . . . . 6-8
</TABLE>
<PAGE>
Independent Auditors' Report
The Board of Directors and Shareholders
National Air Corporation:
We have audited the accompanying balance sheet of National Air Corporation as of
December 31, 1996, and the related statements of operations, stockholders'
deficit, and cash flows for the years ended December 31, 1996 and December 31,
1995. 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 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 financial statements referred to above present fairly,
in all material respects, the financial position of National Air Corporation as
of December 31, 1996, and the results of their operations and their cash flows
for the years ended December 31, 1996 and December 31, 1995 in conformity with
generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that
National Air Corporation will continue as a going concern. As discussed in
note 2 to the financial statements, the Company has accumulated losses from
operations, has no assets, and has a net working capital deficiency that raise
substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in note 2.
The financial statements do not include any adjustment that might result from
the outcome of this uncertainty.
MANTYLA, McREYNOLDS & ASSOCIATES
Salt Lake City, Utah By/s/ Mantyla, McReynolds &Associates
February 5, 1997
1
<PAGE>
National Air Corporation
Balance Sheet
December 31, 1996
<TABLE>
<CAPTION>
<S> <C>
ASSETS
------
Assets $ -0-
------
Total Assets $ -0-
======
LIABILITIES AND STOCKHOLDERS' DEFICIT
-------------------------------------
Current Liabilities
Payable to Stockholders $ 2,119
-------
Total Current Liabilities 2,119
-----
Total Liabilities 2,119
Stockholders' Deficit: (Note 4)
Common stock, $.001 par value;
authorized 20,000,000 shares; issued
and outstanding 737,505 shares 738
Additional paid in capital 57,469
Accumulated deficit (60,326)
-------
Total Stockholders' Deficit (2,119)
------
Total Liabilities and
Stockholders Deficit $ -0-
======
</TABLE>
See accompanying notes to financial statements
2
<PAGE>
National Air Corporation
Statements of Operations
For the Years Ended December 31, 1996 and December 31, 1995
<TABLE>
<CAPTION>
<S> <C> <C>
1996 1995
---- ----
Revenue:
Revenues from operations $ -0- $ -0-
------ -------
Total Revenue -0- -0-
General and Administrative Expenses 4,676 750
----- ---
Net Income Before Taxes (4,676) (750)
Income taxes -0- -0-
- -
Net income $ (4,676) $ (750)
========= =========
Loss per share $ (.01) $ (.01)
========= =========
Weighted Average Shares Outstanding 4,141,498 6,515,625
========= =========
</TABLE>
See accompanying notes to financial statements
3
<PAGE>
National Air Corporation
Statements of Stockholders' Deficit
For the Years Ended December 31, 1996 and December 31, 1995
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
<C>
Additional
Net
Common Common Paid in
Accumulated Stockholders'
Shares Stock Capital Deficit
Deficit
------ ----- ------- -------
-------
Balance, December 31, 1994 6,000,000 $ 6,000 $ 48,900 $ (54,900)
$ -0-
Issued 750,000 shares of common
stock to Directors for expenses,
April 25, 1995 750,000 750
750
Net loss for the year ended
December 31, 1995 (750)
(750)
--------- ------- ------ --------
-----
Balance, December 31, 1995 6,750,000 $ 6,750 $ 48,900 $ (55,650)
$ -0-
Reverse split (20 for 1 share)
July 31, 1996 (6,412,495) (6,412) 6,412
-0-
Issued 400,000 shares of common
stock to stockholder for expenses,
October 28, 1996 400,000 400 2,157
2,557
Net loss for the year ended
December 31, 1996 (4,676)
(4,676)
------- ------ ------ -------
-------
Balance, December 31, 1996 737,505 $ 738 $ 57,469 $ (60,326)
$ (2,119)
======= ======== =========== ===========
==========
</TABLE>
See accompanying notes to financial statements
4
<PAGE>
National Air Corporation
Statements of Cash Flows
For the Years Ended December 31, 1996 and December 31, 1995
<TABLE>
<CAPTION>
<S> <C> <C>
1996 1995
---- ----
Cash Flows Provide by/(Used for)
Operating Activities:
Net Loss $ (4,676) $ (750)
Adjustments to reconcile net income
to net cash used for operating
activities:
Issuance of common stock as
payment for services rendered
by stockholder 2,557 750
Expenses paid on behalf
of company by a
stockholder 2,119 -0-
------ ------
Net Cash Used for Operating
Activities -0- -0-
Net Increase in cash -0- -0-
------ ------
Beginning Cash -0- -0-
------ ------
Ending Cash $ -0- $ -0-
====== =======
Supplemental Disclosure of Cash Flow Information
- ------------------------------------------------
Cash paid during the periods for:
Interest $ -0- $ -0-
====== =======
Taxes $ -0- $ -0-
====== =======
</TABLE>
See accompanying notes to financial statements
5
<PAGE>
National Air Corporation
Notes to Financial Statements
December 31, 1996
Note 1 Organization and Summary of Significant Accounting Policies
(a) Organization
National Air Corporation [Company] incorporated under the laws of
the State of Nevada on January 9, 1985. The Company was dormant
for several years but was revived March 1, 1996.
The Company was originally organized to engage in any lawful
activity. The Company entered the business of providing air
transportation services on a lease and/or charter basis, but was
unsuccessful in the endeavor.
(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 bases and tax bases of the Company's assets
and liabilities at enacted tax rates expected to be in effect
when such amounts are realized or settled. The cumulative effect
of this change in accounting for income taxes as of December 31,
1996 is $0 due to the valuation allowance established as
described below.
(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 the bank to be cash. The Company
has $0 cash at December 31, 1996.
6
<PAGE>
NATIONAL AIR CORPORATION
Notes to Financial Statements
December 31, 1996
[continued]
Note 2 Liquidity
The Company has accumulated losses through December 31, 1996
amounting to $60,326, has no assets, has no working capital at
December 31, 1996, and does not anticipate generating sufficient
cash flows from operations to meet the Company's cash
requirements. These factors raise substantial doubt about the
Company's ability to continue as a going concern.
Management plans include finding a well-capitalized merger
candidate to commence operations. The financial statements do
not include any adjustments that might result from the outcome
of this uncertainty.
Note 3 Income Taxes
The Company adopted Statement No. 109 as of April 1, 1993. Prior
years' financial statements have not been restated to apply the
provisions of Statement No. 109. No provision has been made in
the financial statements for income taxes because the Company has
accumulated substantial losses from operations.
The tax effects of temporary differences that give rise to
significant portions of the deferred tax asset at December 31,
1996 have no impact on the financial position of the Company. A
valuation allowance is provided when it is more likely than not
that some portion of the deferred tax asset will not be realized.
Because of the lack of taxable earnings history, the Company has
established a valuation allowance for all future deductible
temporary differences.
7
<PAGE>
NATIONAL AIR CORPORATION
Notes to Financial Statements
December 31, 1996
[continued]
Note 4 Common of Stock
On April 25, 1995, the Board of Directors authorized the issuance
of 250,000 shares of common stock to each of three directors for
services rendered, on the basis of one mill ($.001) per share.
On July 14, 1996, the Board of Directors resolved to effect a 20
for one reverse split of the 6,750,000, then outstanding,
securities of the Company, while retaining the present authorized
capital and par value, and making appropriate adjustments in the
stated capital and additional paid-in-capital accounts.
Fractional shares were to be rounded to the nearest whole share.
The effective date of the reverse split was the close of
business, July 31, 1996.
On October 26, 1996 the Company issued 400,000 post reverse-split
shares of common stock to a shareholder for expenses incurred on
behalf of the company.
8
<PAGE>
NATIONAL AIR CORORATION
BALANCE SHEETS
April 30, 1997
<TABLE>
<CAPTION>
<S> <C>
4/30/97
----------------
[Unaudited]
ASSETS
Current Assets $ 0
TOTAL ASSETS $ 0
================
LIABILITIES & EQUITY
LIABILITIES
Current Liabilities
Loans from stockholders $ 3,835
Total Current Liabilities 3,835
----------------
----------------
TOTAL LIABILITIES 3,835
EQUITY
Common Stock 738
Paid-in Capital 57,469
Accumulated Deficit (62,042)
----------------
TOTAL EQUITY (3,835)
----------------
TOTAL LIABILITIES & EQUITY $ 0
================
</TABLE>
<PAGE>
NATIONAL AIR CORPORATION
STATEMENTS OF OPERATIONS
For the Four-Month Periods Ended April 30, 1997 and 1996
<TABLE>
<CAPTION>
<S> <C> <C>
Four Months Four Months
Ended Ended
4/30/97 4/30/96
------------------ ------------------
[Unaudited] [Unaudited]
REVENUE
Income $ 0 $ 0
------------------ ------------------
NET REVENUE 0 0
OPERATING EXPENSES
Office Expenses 253 1,475
Professional Fees 1,463 0
------------------ ------------------
TOTAL OPERATING EXPENSES 1,716 1,475
------------------ ------------------
NET INCOME/(LOSS) $ (1,716) $ (1,475)
================== ==================
NET LOSS PER SHARE $ (0.01) (0.01)
================== ==================
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING 737,505 6,412,495
================== ==================
</TABLE>
<PAGE>
NATIONAL AIR CORPORATION
STATEMENTS OF CASH FLOWS
For the Four-Month Periods Ended April 30, 1997 and 1996
<TABLE>
<CAPTION>
<S> <C> <C>
Four Months
Four Months
Ended
Ended
4/30/97
4/30/96
-------------------
- ------------------
[Unaudited]
[Unaudited]
Cash Flows Used For Operating Activities
- -------------------------------------------------------------------
Net Loss $ (1,617) $
(1,475)
Adjustments to reconcile net loss to net cash
used in operating activities:
Increase/(Decrease) in loans from shareholder 1,617
1,475
-------------------
- ------------------
Net Cash Used For Operating Activities 0
0
Cash Flows Provided by Financing Activities 0
0
- -------------------------------------------------------------------
Net Increase In Cash 0
0
Beginning Cash Balance 0
0
-------------------
- ------------------
Ending Cash Balance $ 0 $
0
===================
==================
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000768216
<NAME> NATIONAL AIR CORPORATION
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C> <C>
<PERIOD-TYPE> 4-MOS YEAR
<FISCAL-YEAR-END> DEC-31-1997 DEC-31-1996
<PERIOD-START> JAN-01-1997 JAN-01-1996
<PERIOD-END> APR-30-1997 DEC-31-1996
<EXCHANGE-RATE> 1 1
<CASH> 0 0
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 0 0
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 0 0
<CURRENT-LIABILITIES> 3,835 2,119
<BONDS> 0 0
0 0
0 0
<COMMON> 738 738
<OTHER-SE> (4,573) (2,857)
<TOTAL-LIABILITY-AND-EQUITY> 0 0
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 1,716 4,676
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> 0 0
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (1,716) (4,676)
<EPS-PRIMARY> (.01) (.01)
<EPS-DILUTED> (.01) (.01)
</TABLE>
