<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
[_] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ____________________ to ____________________
Commission file number: 000-28112
MOTORVAC TECHNOLOGIES, INC.
(Exact Name of Small Business Issuer as Specified in Its Charter)
STATE OF DELAWARE 33-0522018
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1431 S. VILLAGE WAY
SANTA ANA, CALIFORNIA 92705
(Address of Principal Executive Offices)
(714) 558-4822
(Issuer's Telephone Number, Including Area Code)
N/A
- --------------------------------------------------------------------------------
(Former Name, Former Address and Former Fiscal Year, if Changed
Since Last Report)
Check whether the issuer (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
past 12 months (or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing requirements for the
past 90 days. Yes X No
----- -----
(APPLICABLE ONLY TO CORPORATE ISSUERS)
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date.
<TABLE>
<CAPTION>
Title Date Outstanding
<S> <C> <C>
Common Stock, $.01 par value June 30, 1996 4,514,918
</TABLE>
Transitional Small Business Disclosure Format (check one);
Yes No X
---- ----
<PAGE>
MOTORVAC TECHNOLOGIES, INC
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30
1995 1996
------------- -------------
<S> <C> <C>
ASSETS
------
CURRENT ASSETS
Cash $ 5,008 $ 4,140,414
Accounts receivable, net of allowance for doubtful accounts of $186,599
(December 31, 1995) and $61,903 (June 30, 1996) 773,329 1,023,706
Inventories, net 1,109,250 1,265,927
Other Current Assets 166,778 124,628
------------- -------------
Total Current Assets 2,054,365 6,554,675
PROPERTY AND EQUIPMENT, net 288,527 266,636
INTANGIBLE ASSETS, (net of accumulated amortization of $152,095
(December 31, 1995) and $334,538 (June 30, 1996) 1,672,348 1,489,904
OTHER ASSETS 25,000 25,000
------------- -------------
$ 4,040,240 $ 8,336,215
============= =============
LIABILITIES AND STOCKHOLDERS (DEFICIENCY) EQUITY
------------------------------------------------
CURRENT LIABILITIES
Accounts payable and other accrued liabilities $ 1,364,490 $ 1,237,062
Accrued interest-related parties 649,901 26,665
Amounts payable to ex-licensor 219,250 199,250
------------- -------------
Total current liabilities 2,233,641 1,462,977
AMOUNTS PAYABLE TO EX-LICENSOR 219,295 125,538
NOTES PAYABLE TO RELATED PARTIES 5,273,872 1,420,000
COMMITMENTS AND OTHER CONTINGENCIES
STOCKHOLDERS' (DEFICIENCY) EQUITY
Cumulative Series A preferred stock ($.01 par); 95,295 shares
authorized and outstanding. (liquidation preference $4,764,750) at 953 0
December 31, 1995, 0 outstanding at June 30, 1996
Cumulative Series B preferred stock ($.01 par); 55,000 shares
authorized 54,300 shares outstanding (liquidation preference
$2,715,000)at December 31, 1995, 0 outstanding at June 30, 1996 543 0
Common stock, $.01 par value; 10,000,000 shares authorized;
948,000 shares issued and outstanding at December 31, 1995
4,514,918 shares issued and outstanding at June 30, 1996 9,480 45,149
Additional paid in capital 6,995,448 16,527,629
Accumulated deficit (10,692,992) (11,245,078)
------------- -------------
Total Shareholders' (deficiency) equity (3,686,568) 5,327,700
------------- -------------
$ 4,040,240 $ 8,336,215
============= =============
</TABLE>
2
<PAGE>
MOTORVAC TECHNOLOGIES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
-------------------------- -------------------------
JUNE 30 JUNE 30 JUNE 30 JUNE 30
1996 1995 1996 1995
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
NET SALES 1,823,311 1,009,915 3,170,840 2,043,795
COST OF SALES 1,029,357 627,871 1,567,108 1,223,007
----------- ----------- ----------- -----------
GROSS PROFIT 793,954 382,044 1,603,732 820,788
OPERATION EXPENSES
Selling, General and Administrative Expenses 981,993 794,723 1,929,217 1,946,867
Research and Development Expenses 30,704 94,577 44,836 230,946
----------- ----------- ----------- -----------
1,012,697 889,300 1,974,053 2,177,813
----------- ----------- ----------- -----------
LOSS FROM OPERATIONS (218,743) (507,256) (370,321) (1,357,025)
INTEREST EXPENSE-RELATED PARTIES 35,900 128,694 181,765 241,002
----------- ----------- ----------- -----------
LOSS BEFORE PROVISION FOR INCOME TAXES (254,643) (635,949) (552,086) (1,598,026)
PROVISION FOR INCOME TAXES 0 0 0 0
----------- ----------- ----------- -----------
NET LOSS (254,643) (635,949) (552,086) (1,598,026)
=========== =========== =========== ===========
SUPPLEMENTAL DATA (NOTE 3)
Historical Loss (254,643) (552,086)
Proforma reduction in interest expense 26,153 132,416
----------- -----------
PRO FORMA NET LOSS (228,490) (419,670)
=========== ===========
PRO FORMA NET LOSS PER COMMON SHARE (0.05) (0.09)
=========== ===========
PRO FORMA WEIGHTED AVERAGE OUTSTANDING
COMMON AND COMMON EQUIVALENT SHARES 4,439,540 4,442,914
=========== ===========
</TABLE>
3
<PAGE>
MOTORVAC TECHNOLOGIES, INC
STATEMENT OF CASH FLOW
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
------------------------ ------------------------
JUNE 30 JUNE 30 JUNE 30 JUNE 30
1996 1995 1996 1995
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
CASH FLOW FROM OPERATION ACTIVITIES:
Net Loss (254,643) (635,949) (552,086) (1,598,026)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization 116,523 45,389 231,719 102,664
Loss on disposal of long term assets 0 0 0 0
Net change in operation assets and liabilities:
Accounts receivable 258,249 (56,564) (250,377) 155,721
Inventories (51,563) (83,994) (156,677) (47,901)
Other current assets, intangibles and other assets 293,249 34,367 42,150 (79,315)
Interest payable to related parties (769,139) 128,743 (623,236) 254,514
Accounts payable and other current liabilities (282,997) (4,272) (127,428) (299,265)
---------- ---------- ---------- ----------
net cash used in operating activities (690,321) (572,280) (1,435,935) (1,511,608)
---------- ---------- ---------- ----------
CASH FLOW FROM INVESTING ACTIVITIES
Purchase of equipment (15,074) (35,736) (27,384) (47,171)
CASH FLOW FROM FINANCING ACTIVITIES
Net proceeds from issuance of 1,210,000 common stock 5,156,054 0 5,156,054 0
proceeds from issuance of notes payable to related parties 0 806,199 680,000 1,546,463
(Increase) decrease in receivable from licensor 0 1,215 0 168,547
Payments to ex-licensor (89,701) 0 (113,757) 0
Repayment of notes to related parties (223,572) 0 (123,572) 0
---------- ---------- ---------- ----------
net cash provided by financing activities 4,842,781 807,414 5,598,725 1,715,010
---------- ---------- ---------- ----------
NET INCREASE (DECREASE) IN CASH 4,137,386 199,398 4,135,406 156,231
CASH, Beginning of period 3,028 17,196 5,008 60,363
---------- ---------- ---------- ----------
CASH, End of period 4,140,414 216,594 4,140,414 216,594
========== ========== ========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION
Interest paid 836,423 0 836,423 0
========== ========== ========== ==========
Income taxes paid 0 0 0 0
========== ========== ========== ==========
Conversion of Preferred Series A Stock to Common Stock (net) 4,659,499 0 4,659,499 0
========== ========== ========== ==========
Conversion of Preferred Series B Stock to Common Stock (net) 2,170,425 0 2,170,425 0
========== ========== ========== ==========
Conversion of Notes Payable to related parties to Common Stock 4,410,300 0 4,410,300 0
========== ========== ========== ==========
</TABLE>
4
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Notes to Unaudited Financial Statements:
----------------------------------------
1. Basis of Presentation
---------------------
The information set forth in these financial statements as of June 30, 1996
is unaudited and may be subject to normal year-end adjustments. In the
opinion of management, the unaudited financial statements reflect all
adjustments, consisting only of normal recurring adjustments, necessary to
present fairly the financial position of MotorVac Technologies, Inc. (the
"Company" or "MTI") for the period indicated. Results of operations for
the interim period ended June 30, 1996 are not necessarily indicative of
the results of operations for the full fiscal year.
Certain amounts in the prior years' Consolidated Financial Statements have
been reclassified to conform to the current fiscal year's presentation.
Certain information normally included in footnote disclosures to the
financial statements has been condensed or omitted in accordance with the
rules and regulations of the Securities and Exchange Commission.
2. Initial Public Offering
-----------------------
On May 1, 1996, the Company completed an initial public offering of
1,100,000 shares of its common stock at $5.375 per share, netting proceeds
to the Company, after underwriter's discounts and expenses, of
approximately $5,143,875. On June 13, 1996, the Company completed the sale
to the underwriter upon exercise of the underwriter's overallotment option
of an additional 110,000 shares at $5.375 per share, netting to the
Company, after underwriter's discounts and expenses, an additional amount
of approximately $514,388. Proceeds to the Company were used to repay
approximately $836,000 of accrued interest and approximately $124,000 of
offering expense reimbursement to the Company's major shareholder. The
remaining proceeds are anticipated to be used to expand the Company's
advertising and marketing efforts, acquire related products or product
lines, and for working capital.
3. Pro Forma Data
--------------
Pro Forma Net Loss
Pro forma net loss represents the results of operations adjusted to reflect
the impact of the elimination of interest expense related to the $4,410,300
in debt due Erin Mills International Investment Corporation ("EMIIC"), a
related party, and The WH & NC Eighteen Corporation ("WH & NC"), an
affiliate of EMIIC, which was exchanged for common stock immediately prior
to the consummation of the initial public offering.
5
<PAGE>
Pro Forma Net Loss Per Share
Historical net income per common share is not presented because it is not
indicative of the ongoing entity. Pro forma net loss per share has been
computed by dividing pro forma net loss by the weighted average number of
shares of common stock outstanding during the period.
4. Inventories
-----------
Inventories, which include materials, supplies, labor and manufacturing
overhead, are summarized as follows:
<TABLE>
<CAPTION>
December 31, 1995 June 30, 1996
----------------- -------------
<S> <C> <C>
Materials and supplies 617,741 916,635
Work in process 100,750 100,751
Finished product 390,759 248,541
--------- ---------
1,109,250 1,265,927
========= =========
</TABLE>
6
<PAGE>
MOTORVAC TECHNOLOGIES, INC.
---------------------------
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
GENERAL
MotorVac Technologies, Inc. (the "Company") designs, develops, assembles,
markets and sells the MotorVac CarbonClean System for the diagnosis, maintenance
and repair of internal combustion engine fuel systems primarily for the
automotive after-market repair and service industry. The Company markets and
sells its fuel system cleaning machines and detergents through various
distribution channels, both in the United States and Canada ("Domestic") under
the trade name MotorVac, and outside the United States and Canada
("International") under the trade name CarbonClean.
The following discussion and analysis addresses the results of the
Company's operations for the six months ended June 30, 1996, and for the three
months ended June 30, 1996, as compared to the Company's results of operations
for the six months ended June 30, 1995, and for the three months ended June 30,
1995. On May 1, 1996, the Company consummated an initial public offering (the
"IPO") of 1,100,000 shares of its common stock, resulting in gross proceeds of
approximately $5,912,500. On June 13, 1996, the Company completed the sale of
an additional 110,000 shares of its Common Stock upon exercise of the
underwriter's overallotment option (the "Overallotment"), resulting in gross
proceeds to the Company of approximately $591,250.
This Quarterly Report on Form 10-QSB contains certain forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), and the
Company intends that such forward-looking statements be subject to the safe
harbors created thereby. The Company may experience significant fluctuations in
future operating results due to a number of factors, including, among other
things, the size and timing of customer orders, new or increased competition,
delays in new product enhancements and new product introductions, quality
control difficulties, changes in market demand, market acceptance of new
products, product returns, seasonality in product purchases by distributors and
end users, and pricing trends in the automotive after-market industry in
general, and in the specific markets in which the Company is active. Any of
these factors could cause operating results to vary significantly from prior
periods. Significant variability in orders during any period may have a
material adverse impact on the Company's cash flow or work flow, and any
significant decrease in orders could have a material adverse impact on the
Company's results of operations and financial condition. As a result, the
Company believes that period-to-period comparisons of its results of operations
are not necessarily meaningful and should not be relied upon as any indication
of future performance. Fluctuations in the Company's operating results could
cause the price of the Company's Common Stock to fluctuate substantially.
Assumptions relating to the foregoing involve judgments with respect to,
among other things, future economic, competitive and market conditions, all of
which are difficult or impossible to predict accurately, and many of which are
beyond the control of the Company. In addition, the business and operations of
the Company are subject to substantial risks which increase the uncertainty
inherent in the forward-looking statements. In light of the significant
uncertainties inherent in the forward-looking information included herein, the
inclusion of such information should not be regarded as a representation by the
Company or any other person that the objectives or plans of the Company will be
achieved.
7
<PAGE>
RESULTS OF OPERATIONS
Comparison of Three Months Ended June 30, 1996 and 1995
Net Sales. Net sales for the three months ended June 30, 1996 increased
----------
$813,396 (approximately 80.5%) to $1,823,311 from $1,009,915 for the three
months ended June 30, 1995. This sales increase was due to increases in both
Domestic and International sales, with Domestic sales up 92.3% and International
sales up 52.5% over the same period last year. This was due to an increase in
both machine and detergent sales to a major customer in the U.S., and an
increase in machine and detergent sales to a number of customers in
International.
For the three months ended June 30, 1996, Domestic sales were $1,368,218
and International sales were $455,093. For the three months ended June 30,
1995, Domestic sales were $711,475, and International sales were $298,441.
Gross Profit. Gross profit for the three months ended June 30, 1996
-------------
increased by $411,910 (108%) to $793,954 from $382,044 for the three months
ended June 30, 1995. The primary reason for the increase is the increase in
sales, but the Company also experienced a slightly higher margin, as a percent
of sales from 37.8% of sales for the three months ended June 30, 1995, to 43.5%
of sales for the three months ended June 30, 1996. This increase was primarily
due to shift in product mix to detergent (which has a higher gross margin than
machines) as a percent of total sales.
Operating Expenses. Operating expenses increased by $123,397
-------------------
(approximately 13.9%) from $889,300 for the three months ended June 30, 1995, to
$1,012,697 for the three months ended June 30, 1996. The increase was primarily
attributable to increased legal expense and miscellaneous costs associated with
being a public company.
Loss From Operations. As a result of the above, the loss from operations
---------------------
for the three months ended June 30, 1996 of $218,743 improved by $288,513
(56.9%) from a loss of $507,256 for the three months ended June 30, 1995.
Interest. Interest (net) expense for the three months ended June 30, 1996
---------
of $35,900 improved by $92,794 (approximately 72.1%) from $128,694 for the three
months ended June 30, 1995. This improvement was a result of the conversion of
$4,410,300 of notes payable to EMIIC which were converted to Common Stock at the
IPO price on April 25, 1996, and interest income the Company earned on the IPO
proceeds.
Net Loss. The net loss for the three months ended June 30, 1996 of
---------
$254,643 improved by $381,306 (approximately 60.0%) from a net loss of $635,949
for the three months ended June 30, 1995.
Comparison of Six Months Ended June 30, 1996 and 1995
Net Sales. Net sales for the six months ended June 30, 1996 increased
----------
$1,127,045 (approximately 55.1%) to $3,170,840 from $2,043,795 for the six
months ended June 30, 1995. This is due to an increase in both machine and
detergent sales.
Domestic sales for the six months ended June 30, 1996 were $1,762,585, and
International sales for the same period were $1,408,255. For the six months
ended June 30, 1995, Domestic sales were $1,070,868, and International sales
were $972,928.
Gross Profit. Gross profit for the six months ended June 30, 1996
-------------
increased $782,944 (approximately 95.4%) to $1,603,732 from $820,788 for the six
months ended June 30, 1995. The primary reason for this increase was an
increase in sales volume and a shift in sales mix to detergent (which has a
higher gross margin than machines) as a percent of total sales.
8
<PAGE>
Operating Expenses. Operating expenses for the six months ended June 30,
-------------------
1996 of $1,974,053 decreased by $203,760 (approximately 9.4%) from $2,177,813
for the six months ended June 30, 1996. This decrease was due mostly to savings
in R & D costs (because of the R & D cycle being mostly completed by 1996), and
some savings in other expense groupings.
Loss From Operations. As a result of the above, the loss from operations
---------------------
for the six months ended June 30, 1996 improved by $986,704 (approximately
72.7%) to a loss of $370,321 from $1,357,025 for the six months ended June 30,
1995.
Interest. Interest (net) expense for the six months ended June 30, 1996
---------
improved by $59,237 (approximately 24.6%) to $181,765 from $241,002 for the six
months ended June 30, 1995. The primary reason for the improvement was the
conversion of $4,410,300 of EMIIC debt at the time of the IPO, and interest
revenue earned on cash on hand for the six months ended June 30, 1996.
Net Loss. The net loss for the six months ended June 30, 1996 improved by
---------
$1,045,940 (65.5%) to $552,086 from a loss of $1,598,026 for the six months
ended June 30, 1995.
LIQUIDITY AND CAPITAL RESOURCES
As of June 30, 1996, the Company had working capital of $5,091,698. At
December 31, 1995, the Company had a working capital deficit of $179,276.
For the Three Months Ended June 30, 1996
- ----------------------------------------
Cash at April 1, 1996 was $17,196. Cash used in operating activities
during the three months ended June 30, 1996, which includes current assets and
current liabilities, was $690,321. Cash used in investing activities was
$15,074, which represented the purchase of fixed assets. Cash flow from
financing activities was $4,842,781 representing the net proceeds from the
issuance of 1,210,000 common shares in the IPO and the Overallotment of
$5,156,054, less repayment of notes payable to related parties of $223,572 and
payments to ex-licensor of $89,701. The net increase in cash for the three
months ended June 30, 1996 was $4,137,386, resulting in ending cash of
$4,140,414.
For the Six Months Ended June 30, 1996
- --------------------------------------
Cash at January 1, 1996 was $5,008. Cash used in operating activities for
the six months ended June 30, 1996 was $1,435,935. Cash used in investing
activities was $27,384, which represents the purchase of fixed assets. Cash
from financing activities was $5,598,725 which consisted of $680,000 of proceeds
from the issuance of notes payable to related parties, and $5,156,054 of net
proceeds from the issuance of 1,210,000 of common stock at the IPO price of
$5.375, less commissions, expenses and fees, and repayment of notes payable to
related parties of $123,572 and payments to ex-licensor of $113,757. The net
increase in cash for the six months ended June 30, 1996 was $4,135,406.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Reference is hereby made to the discussion under the heading "Item 1.
Legal Proceedings" in the Company's Form 10-QSB for the quarter ended March 31,
1996 for information regarding the matter entitled DeCarbon Australia Pty. Ltd.
----------------------------
v. MotorVac Technologies, Inc. (Case No. 764248). The Company is in the process
- ------------------------------
of vigorously defending the allegations in the complaint, and is currently
reviewing taking actions against DeCarbon, including filing a cross-complaint.
Written discovery in this matter has commenced and is continuing.
9
<PAGE>
Reference is hereby made to the discussion under the heading "Legal
Proceedings" contained on page 38 of the Company's Prospectus dated April 25,
1996 with regard to the action filed by the Company in the United States
District Court of the Northern District of Ohio, Eastern Division, against
Richard R. Green, individually and doing business as P&R Equipment Company,
Gregory M. Phillips, C.S.P. International, Inc. and certain other defendants,
and the counterclaim filed by certain of the defendants in connection with such
proceeding.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) 3.1 Amended and Restated Certificate of Incorporation (incorporated herein
by reference to Exhibit No. 3.1 to the Registrant's Registration Statement on
Form SB-2 filed with the Securities and Exchange Commission (the "SEC") on
February 29, 1996 (the "Form SB-2").
3.2 Third Amended and Restated Bylaws of Registrant (incorporated by
reference to Exhibit No. 3.2 to the Form SB-2).
3.3 Amendment to the Third Amended and Restated Bylaws of Registrant
(incorporated by reference to Exhibit No. 3.3 to Amendment No. 1 to the Form SB-
2 filed with the SEC on March 29, 1996) (the "Amendment No. 1 to Form SB-2").
4.1 Form of Underwriter's Warrant Agreement by and between the Registrant
and Meridian Capital Group, Inc. (incorporated by reference to Exhibit No. 4.1
to Amendment No. 2 to Form SB-2 filed with the SEC on April 25, 1996) (the
"Amendment No. 2 to Form SB-2").
4.2 Form of certificate evidencing shares of Registrant's common stock
(incorporated by reference to Exhibit No. 4.2 to Amendment No. 1 to Form SB-2).
10.1 Letter Agreement dated April 5, 1996 between the Registrant and
Shrader Packaging Co., Inc. amending the Exclusive Supply Agreement and granting
a right of first refusal to the Registrant (incorporated by reference to Exhibit
10.55 to Amendment No. 2 to Form SB-2).
10.2 Products Distribution Agreement dated May 1, 1996 by and between the
Registrant and Sun Electric De Mexico, S.A. De C.V., covering the territory of
Mexico (incorporated by reference to Exhibit 10.11 to Registrant's Form 10-QSB
for the quarter ended March 31, 1996).
10.3 Products Distribution Agreement dated March 28, 1996, by and between
the Registrant and Cameo (QLD) Pty. Ltd., covering the territory of Australia.
11.1 Statement of Calculation of Pro Forma Net Loss Per Share and Net Loss
Per Share.
27.1 Financial Data Schedule in accordance with Article 5 of Regulation SX.
(b) No reports on Form 8-K were filed during the quarter ended June 30, 1996.
10
<PAGE>
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
MOTORVAC TECHNOLOGIES, INC.,
a Delaware corporation
By: /s/ LEE W. MELODY
-----------------------------------------
Lee W. Melody, President
Date: August 5 , 1996
------------------------------
By: /s/ ALLAN T. MAGUIRE
-----------------------------------------
Allan T. Maguire, Vice President of Finance,
Chief Financial Officer, Treasurer and Secretary
Date: August 5 , 1996
------------------------------
11
<PAGE>
MOTORVAC TECHNOLOGIES, INC.
---------------------------
EXHIBIT INDEX
-------------
3.1 Amended and Restated Certificate of Incorporation (incorporated herein
by reference to Exhibit No. 3.1 to the Registrant's Registration Statement on
Form SB-2 filed with the Securities and Exchange Commission (the "SEC") on
February 29, 1996 (the "Form SB-2").
3.2 Third Amended and Restated Bylaws of Registrant (incorporated by
reference to Exhibit No. 3.2 to the Form SB-2).
3.3 Amendment to the Third Amended and Restated Bylaws of Registrant
(incorporated by reference to Exhibit No. 3.3 to Amendment No. 1 to the Form SB-
2 filed with the SEC on March 29, 1996) (the "Amendment No. 1 to Form SB-2").
4.1 Form of Underwriter's Warrant Agreement by and between the Registrant
and Meridian Capital Group, Inc. (incorporated by reference to Exhibit No. 4.1
to Amendment No. 2 to Form SB-2 filed with the SEC on April 25, 1996) (the
"Amendment No. 2 to Form SB-2").
4.2 Form of certificate evidencing shares of Registrant's common stock
(incorporated by reference to Exhibit No. 4.2 to Amendment No. 1 to Form SB-2).
10.1 Letter Agreement dated April 5, 1996 between the Registrant and
Shrader Packaging Co., Inc. amending the Exclusive Supply Agreement and granting
a right of first refusal to the Registrant (incorporated by reference to Exhibit
10.55 to Amendment No. 2 to Form SB-2).
10.2 Products Distribution Agreement dated May 1, 1996 by and between the
Registrant and Sun Electric De Mexico, S.A. De C.V., covering the territory of
Mexico (incorporated by reference to Exhibit 10.11 to Registrant's Form 10-QSB
for the quarter ended March 31, 1996).
10.3 Products Distribution Agreement dated March 28, 1996, by and between
the Registrant and Cameo (QLD) Pty. Ltd., covering the territory of Australia.
11.1 Statement of Calculation of Pro Forma Net Loss Per Share.
27.1 Financial Data Schedule in accordance with Article 5 of Regulation SX.
12
<PAGE>
MOTORVAC TECHNOLOGIES, INC.
PRODUCTS DISTRIBUTION AGREEMENT
THIS PRODUCTS DISTRIBUTION AGREEMENT ("AGREEMENT") is made and entered into
this 28th day of March, 1996, by and between MOTORVAC TECHNOLOGIES, INC., a
Delaware Corporation ("MTI"), with its principal place of business located at
1431 S. Village Way, Santa Ana, California, U.S.A. and CAMEO (QLD) PTY. LTD.
("Distributor") with its principal place of business located at 121 Newmarket
Road, Unit 3, Windsor, Queensland, 4030, Australia, with reference to the
following facts:
RECITALS
--------
A. MTI markets a range of products and replacement parts for cleaning gasoline
and diesel engines that are sold under the brand names listed in the
schedule attached hereto as Exhibit A, hereinafter referred to as the
"Products."
B. Distributor hereby represents that it possesses the facilities and ability
to promote the sale and distribution of the Products, in accordance with
the Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the covenants and
agreements contained herein, the parties hereto hereby agree as follows:
1. APPOINTMENT OF SOLE AND EXCLUSIVE DISTRIBUTOR:
----------------------------------------------
a. The territory (the "Territory") covered by this Agreement is
Australia.
(I) For the term of this Agreement and in accordance with all of
the terms, and subject to the conditions herein set forth,
MTI hereby appoints Distributor as the sole and exclusive
distributor for the sale and distribution of the Products
within the Territory.
b. Distributor hereby accepts its appointment as a distributor of
the Products to develop a demand for, and to the best of its
ability, sell and distribute the Products within the Territory,
and Distributor hereby represents and warrants that it will make
all sales hereunder in accordance with the terms contained in
this Agreement. Distributor's obligations under this Agreement
shall include, but not be limited to:
(I) Establishing and maintaining Distributor owned facilities
located within the Territory for display and demonstration of
the Products;
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
1
<PAGE>
(ii) Hiring, training and maintaining adequately trained sales
and technical personnel to develop a market and service the
demand for the Products in the Territory:
(iii) Undertaking advertising campaigns and trade shows;
(iv) Concurrent with execution hereof, Distributor shall provide
to MTI an Annual Minimum Performance Goal ("Annual Goal"), which
Annual Goal represents the minimum amount of Products to be
purchased by the Distributor from MTI for the first year of this
Agreement. The Distributor agrees that the Annual Goal shall be
required to be purchased by Distributor from MTI as follows:
(a) 50% of the Annual Goal or greater must be purchased
during the first 180 days of this Agreement and
subsequent years of this Agreement (the "First 180-Day
Goal"), and the balance of the Annual Goal must be
purchased during the second 180 days of this Agreement
and subsequent years of this Agreement (the "Second
180-Day Goal") (collectively called the "Annual Goal"),
which Annual Goal shall be deemed to be added to
Section 3b of this Agreement. During the remainder of
the term of this Agreement, the Distributor shall
provide MTI with an Annual Goal for all subsequent
years, and such Annual Goals shall be delivered to MTI
at least 60 days in advance of the start of each
respective year. All Annual Goals are subject to
acceptance by MTI at its sole discretion. In the event
that MTI does not accept the Annual Goal set by the
Distributor, MTI and the Distributor shall attempt to
come to an agreement on an Annual Goal. In the event
that (A) the Distributor does not timely deliver an
Annual Goal to MTI or (B) MTI does not accept an Annual
Goal set by the Distributor, or MTI and the Distributor
are unable to agree upon a replacement Annual Goal,
within 30 days of the date that the Distributor
communicates the Annual Goal to MTI (collectively, an
"Annual Goal Default"), then MTI may terminate this
Agreement in accordance with the provisions of Section
8b hereof;
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
2
<PAGE>
(v) Conducting its business in a manner that will reflect favorably
at all times on Distributor, MTI and the Products and the good
name, good will and reputation of MTI and its authorized
distributors. Distributor shall not itself or with others
participate in any illegal, deceptive, misleading or unethical
advertising or other practices or techniques that are or might be
detrimental to MTI, the Products or the public; and
(vi) Complying with all applicable laws and with the terms of
this Agreement in connection with the distribution of the
Products.
2. TERM OF AGREEMENT:
------------------
a. The initial term of this Agreement shall be for three (3) years
unless earlier terminated as provided in this Agreement. Thereafter,
the term of this Agreement shall be automatically extended for
successive one-year periods unless either party to this Agreement
gives the other party to this Agreement notice of its intent to
terminate this Agreement, and such notice is received by the non-
terminating party at least sixty (60) days prior to the expiration of
the initial term or renewal term, as applicable.
3. DISTRIBUTOR PURCHASES:
----------------------
a. Exclusivity. Distributor shall obtain its requirements of Products
-----------
only from MTI.
b. Minimum Purchases/Performance Goals. Distributor acknowledges that
------------------------------------
it has represented to MTI that it possesses the facilities and the
ability to generate sales of and distribute the Products, in
accordance with this Agreement, and that based upon these
representations, MTI has entered into this Agreement with the
understanding that Distributor shall make the minimum purchases of
Product, in accordance with the Annual Goals set forth in this
Agreement or as periodically required by this Agreement. The
Distributor and the Company hereby agree that the Annual Goals, as set
forth following, are expressed in U.S. dollars and Units of Product.
If the Distributor meets or exceeds the Annual Goals or the First 180-
day Goal or the Second 180-day Goal, as defined in Section 1.b. of
this Agreement, for the first year or subsequent years of this
Agreement, in either U. S. dollar purchases or Units of Product
Purchases, that particular Goal will be deemed to have been met. For
the first year of this Agreement, set forth below are the ANNUAL GOALS
AS AGREED TO BETWEEN MTI AND THE DISTRIBUTOR:
INITIAL:
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REVISION DATE: 5/28/96
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THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
3
<PAGE>
<TABLE>
<CAPTION>
FOR THE FIRST YEAR:
------------------------
PRODUCTS
------------------------
<S> <C>
Equipment:
Units of Petrol Machines 180
--------
Units of Diesel Machines 20
--------
Cleaning Solution:
Cases of Gasoline Fuel
System Cleaner or Drum
Equivalent 1,800
--------
Cases of Diesel Fuel
System Cleaner or Drum
Equivalent 200
--------
U. S. Dollar Annual Goal $432,700
--------
</TABLE>
NOTE: MINIMUM PURCHASES OF 50% OF THE ABOVE TOTALS (IN EITHER PRODUCT OR IN
- -----
DOLLARS) MUST BE ACHIEVED WITHIN THE FIRST 180 DAYS FOR THIS FIRST YEAR OF THIS
AGREEMENT.
INITIAL:
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THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
4
<PAGE>
c. Minimum Performance Goals / Subsequent Years. The form of schedule
---------------------------------------------
shown below should be used by the Distributor to submit Annual Goals
for the Year as specified in Section 1.b.iv.
Set forth below is the ANNUAL GOAL as agreed between MTI and the
Distributor:
FOR THE YEAR FROM _________________ TO ________________ :
<TABLE>
<CAPTION>
PRODUCTS
--------
<S> <C>
Equipment:
Units of Petrol Machines
-----------------
Units of Diesel Machines
-----------------
Cleaning Solution:
Cases of Gasoline Fuel
System Cleaner or Drum
Equivalent
-----------------
Cases of Diesel Fuel
System Cleaner or Drum
Equivalent
-----------------
U. S. Dollar Annual Goal
-----------------
</TABLE>
ANNUAL GOAL IS REQUIRED TO BE SUBMITTED BY THE DISTRIBUTOR TO MTI AT LEAST
60 DAYS BEFORE THE EXPIRATION OF EACH YEARLY ANNIVERSARY OF THE DATE OF
SIGNING OF THAT CERTAIN PRODUCTS DISTRIBUTION AGREEMENT BETWEEN DISTRIBUTOR
AND MOTORVAC TECHNOLOGIES, INC. ("MTI") AND THIS ANNUAL GOAL IS SUBJECT TO
ACCEPTANCE BY MTI IN ITS SOLE DISCRETION.
<TABLE>
<S> <C>
SUBMITTED BY: ________________ DATE: ________________
DISTRIBUTOR NAME: ________________
ACCEPTED BY: ________________ DATE: ________________
ON BEHALF OF MTI
</TABLE>
INITIAL:
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DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
5
<PAGE>
d. Normal Retail Price. Concurrent with each submission of Annual
--------------------
Goal by the Distributor under this Agreement, the Distributor shall
also submit to MTI the "Normal Retail Price" of each and all Products
in the Distributor's Territory. Such Normal Retail Price shall be the
price at which the Products are sold to the end user of the Products,
normally a repair garage or service center. Notwithstanding the
foregoing, Distributor is free to set its own resale prices
unilaterally. No employee or representative of MTI has any authority
to tell Distributor what its resale prices must be, nor to inhibit in
any way a Distributor's independent pricing decision.
e. Non-compete. During the term of this Agreement, Distributor will not
------------
not, directly or indirectly, supply, sell, promote or distribute in
the Territory any other products that are similar to, or competitive
with, the Products. Distributor agrees that during the term of this
Agreement, and for a period of three (3) years after the termination
of this Agreement , Distributor will not attempt to replicate, sell,
promote, distribute or manufacture any cleaning solution or fuel
system cleaning machines for use, under any circumstances, with MTI's
patented and proprietary systems , and that any such actions by
Distributor would substantially and permanently damage MTI, and result
in the immediate termination of this Agreement (if applicable), and,
in connection therewith, MTI will be entitled to seek any remedy
available at law or in equity.
f. Restrictions With Respect to Proprietary Information.
-----------------------------------------------------
(I) Trade Secrets. Distributor hereby acknowledges and agrees
-------------
that MTI owns certain trade secrets and other confidential and/or
proprietary information and intellectual property which
constitute valuable property rights, which MTI has developed
through a substantial expenditure of time and money, which are
and will continue to be utilized in MTI's business and which are
not generally known to the trade. This proprietary information
expressly includes, but is not limited to, the list of names of
the distributors, dealers, customers and suppliers of MTI, the
identities of key personnel of the distributors, dealers,
customers and suppliers of MTI, and other information concerning
the Products, finances, personnel contractors processes, pricing
information, production schedules and other types of proprietary
information relating to MTI's operations. In recognition of these
facts, Distributor hereby agrees that the Distributor, both
during and after the term of this Agreement:
(a) Will not use or disclose, directly or indirectly, and
will keep secret and confidential, all trade secrets and
proprietary
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
6
<PAGE>
information of MTI, including but not limited to
those items specifically mentioned above;
(b) Will not, directly or indirectly, either on
Distributor's own behalf or on behalf of any other person or
entity, solicit or attempt to solicit any employee,
contractor, dealer or distributor of MTI to leave their
employment, contractor, dealer or distributor relationship
with MTI;
(c) Upon the termination of this Agreement or at anytime at
MTI's request, Distributor shall return all documents or
materials which have been furnished to Distributor by MTI in
connection with this Agreement; and
(d) All uses by Distributor of MTI's name or any trademarks
or tradenames (or any other marks or names closely
resembling the same) now and hereafter owned by MTI or its
affiliates shall be subject to prior written approval by
MTI. Distributor is not authorized to use MTI's names or
trademarks in connection with any aspect of its business
other than in the sales, marketing and advertising of the
Products.
g. Distributor Further Acknowledges and Agrees :
---------------------------------------------
(I) Copying, duplicating, or imitating the Products by
Distributor is illegal and would result in permanent
irreparable injury to MTI. Any such activities will cause an
immediate termination of this Agreement, and MTI will be
entitled to seek any remedy available at law or in equity.
(ii) Distributor may sell the Products only in the Territory. If
Distributor sells any Products outside said Territory, either
directly or indirectly, the Distributor shall be in breach of
this Agreement and MTI shall have the right to terminate this
Agreement at its sole discretion by providing the Distributor
with 90 days advance written notice. MTI shall not be
required to sell to the Distributor any further Products
after notification of termination has been sent by MTI to the
Distributor.
h. Purchase Price. MTI will sell to the Distributor the Products at
---------------
the prices shown in Exhibit B of this Agreement. These prices are
consistent with those given to MTI's international distributors.
MTI reserves the right to adjust prices from time to time, but may
not increase prices more than two times per
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
7
<PAGE>
year, and each such price increase shall be effective only on
delivery of 30 days prior written notice by MTI to the
Distributor.
i. Payment. The payment of the purchase price for Products purchased
--------
by the Distributor from MTI may be made by cash, irrevocable
letter of credit, sight draft, electronic bank transfer or other
such methods as may be negotiated and accepted by MTI. No
shipments of Product will be made by MTI until method of payment
has been accepted by MTI.
j. Brochures. MTI shall, at its expense, provide Distributor with an
----------
initial supply of MTI's current sales brochures and descriptive
materials in English, which materials include negatives, color
separations and ad slicks, as may be reasonably requested by
Distributor in connection with fulfilling Distributor's
obligations hereunder.
k. Orders. Distributor shall transmit written orders for Products to
-------
MTI. Distributor reserves the right to cancel an order if and when
any of the following circumstances occur and adversely affect the
Distributor or its business:
(I) War;
(ii) Cancellation of Most Favored Nation Treaty and Article 301; or
(iii) Anti-dumping duty charge.
l. Orders. MTI reserves the right to cancel any orders of the
-------
Distributor if and when any of the following circumstances occur and
adversely affect MTI or its business:
(I) War;
(ii) Orders by the government of the United States of America
banning foreign shipments; or
(iii) Acts of God that prevent MTI from completing an order.
MTI also reserves the right to cancel any order placed by the
Distributor or to refuse to ship or to delay the shipment thereof if
1. Distributor:
(I) shall fail to make any payments for Products in accordance with
the terms of this Agreement or in accordance with terms agreed
to between MTI and the Distributor, from time to time;
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
8
<PAGE>
(ii) shall fail to meet the Annual Goal, or the First 180-day Goal
or the Second 180-day Goal set forth as part of this Agreement
or otherwise established from time to time;
(iii) has been notified of MTI's intent to terminate Distributor as a
distributor of MTI pursuant to this Agreement; or
(iv) is not in good financial condition, as determined by MTI; or
2. this Agreement shall have terminated pursuant to the provisions
hereof.
m. Shipments. MTI shall ship the Products or cause the Products to be
----------
shipped as ordered by Distributor upon MTI's acceptance of
Distributor's order and payment terms. MTI will not be responsible
for delays caused by shortage of materials, strikes, shortage of
shipping facilities, acts of God, or other causes not within the
reasonable control of MTI.
4. TRAINING:
---------
a. MTI shall provide initial training in the use of the Products to
Distributor except as specified below. MTI shall be responsible for
paying all expenses, salaries, travel and other costs incurred by
MTI's employees in connection with providing such training.
Distributor shall be responsible for the following expenses :
(I) Local transportation
(ii) Room and board (under special circumstances)
(iii) Any expenses related to the training which occurred in the
Territory.
Following the completion of the initial training and upon reasonable
request of Distributor, MTI shall make its personnel or consultants
available at locations to be selected by MTI for the purpose of
providing additional training in the use of the Products upon
reasonable request of Distributor. MTI shall, at its expense, supply
to Distributor a reasonable number of MTI's current operator manuals,
service bulletins and other materials for use in connection with the
use of the Products.
5. WARRANTIES:
-----------
a. Exclusive Warranties. MTI shall provide Distributor with the
---------------------
manufacturer's warranty applicable for the Products. Such warranty
generally provides that the equipment shall be in good working order
for a period of one (1) year from the date the Product is first
placed in service provided that the end of
--------
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
9
<PAGE>
the Warranty period shall not be later than eighteen (18) months from
the date of shipment of such Product to the Distributor or the
Distributor's customer by MTI (The "Warranty Period").
b. Warranty Repairs. It will be the responsibility of the Distributor
-----------------
to effect repairs to the Products during the Warranty Period.
c. Parts Warranty Claims. All warranty claims must be submitted by
----------------------
the Distributor to MTI for approval. During the Warranty Period, MTI
will replace defective parts on a case by case basis at no charge to
Distributor with an agreed to freight allowance.
d. Sale of Replacement Parts. Nothing contained herein shall be
--------------------------
deemed to prohibit Distributor from selling replacement parts for the
Products within the Territory, provided that subject parts are
purchased from MTI.
e. Other. Distributor further acknowledges that said warranty is
------
effective only if the Products are used with CarbonClean/MotorVac
cleaning solutions listed in Exhibit A attached hereto. Distributor
acknowledges that no Warranties are created by this Agreement and,
with respect to the Products, MTI hereby disclaims all implied
warranties of merchantability and fitness for use for a particular
purpose.
6. INDEPENDENT CONTRACTOR:
-----------------------
This Agreement does not create the relationship of employer and employee,
partnership or agency between MTI and Distributor. Distributor, in
connection with all of its obligations hereunder, shall be an independent
contractor of MTI and under no circumstances is Distributor to be
considered to be the employee, partner or agent of MTI. Distributor is not
granted any right by this Agreement to create any obligation or
responsibility, on behalf of or in the name of MTI. Distributor covenants
that it is and will remain in compliance with all federal, state and local
laws and regulations applicable to its business including, without
limitation, all labor regulations, and foreign, and United States federal
and state tax requirements.
7. MODIFICATIONS AND IMPROVEMENTS:
-------------------------------
Upon making or discovering any improvements to the Product, Distributor
shall:
a. provide MTI with all details of such improvements;
INITIAL:
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REVISION DATE: 5/28/96
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THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
10
<PAGE>
b. acknowledge that such improvements and the right to obtain any
patent, trademark, copyright or other similar protection belong
exclusively to MTI; and
c. provide such assistance to MTI as MTI may reasonably require to
obtain patents, copyrights or other similar protection.
8. TERMINATION:
------------
This Agreement may be terminated for any of the following reasons:
a. Expiration. After the expiration of the term of this Agreement, in
-----------
accordance with Section 2 hereof.
b. Goals. In the event that Distributor fails to provide the required
------
Annual Goals in accordance with Section 1(b(iv) hereof or fails to
purchase the required First 180-day Goal or Second 180-day Goal
amounts at any time, MTI may terminate this Agreement, at its sole
discretion, by providing the Distributor with thirty (30) days
advance written notice of its intent to terminate this Agreement.
c. Default. If, during the term of this Agreement, Distributor
--------
defaults in the performance of any of its other obligations under
this Agreement, or any of the representations or warranties made
by Distributor are determined to be untrue, MTI may give
Distributor notice of default and if Distributor fails to cure
such default within thirty (30) days (or if such default cannot be
cured within thirty (30) days, no diligent effort has been made to
cure such default), this Agreement shall be deemed terminated as
of the end of such ninety (90) day period without any further
action on the part of MTI . Distributor will then accept no
further orders for the Products from the Territory and MTI shall
have no further obligations to Distributor hereunder.
d. Insolvency. This Agreement will automatically terminate if either
-----------
party should become bankrupt, insolvent, or cease to do business,
or make an assignment for the benefit of creditors.
e. Competition This Agreement shall automatically terminate in the
-----------
event that the Distributor breaches any of the covenants against
competition contained in Sections 3.e. and 3.f.(i) hereof;
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
11
<PAGE>
f. Sales Outside the Territory. In the event that the Distributor
----------------------------
breaches the sales covenants contained in Section 3.g.(ii) hereto,
then MTI may terminate this Agreement in accordance with the
notice provisions contained in Section 3.g.(ii) hereof.
g. No Waivers. The failure of MTI to terminate this Agreement
-----------
pursuant to any of the subparagraphs in this Section shall not be
considered to be a waiver by MTI of its right to terminate this
Agreement in the future pursuant to this section for such default
or any similar default.
h. Repurchase. In the event of termination of this Agreement by
-----------
either party for any reason, MTI may at its option repurchase from
Distributor at the net price paid by the Distributor to MTI, less
a 25% restocking charge and actual freight, duties and taxes on
the shipment thereof to the Distributor, any MTI Products at the
Distributor's place of business or in the possession of the
Distributor. On demand and at the tender of the repurchase price
and related cost, shipping and handling expenses and charges
incurred by the Distributor, Distributor shall deliver such
Products to MTI. The payment shall be by negotiable instrument.
9. MISCELLANEOUS:
--------------
a. Modification-Waiver. No cancellation, modification, amendment,
--------------------
deletion, addition, or other change in this Agreement or any
provision hereof, or waiver of any right or remedy herein
provided, shall be effective for any purpose unless specifically
set forth in a writing signed by the party to be bound thereby. No
waiver of any right or remedy in respect of any occurrence or
event shall be deemed nor shall constitute a continuing waiver or
a waiver of any similar occurrence or event on any other occasion.
b. Final Agreement. This Agreement shall be deemed for all purposes
----------------
to have been made in California. This Agreement supersedes and
terminates all prior or contemporaneous other agreements, oral or
written, between the parties hereto with respect to the subject
matter hereof and the transactions contemplated hereby and
discharges any liability of MTI or any affiliated or predecessor
corporation in respect of any such prior agreements, and, together
with the Exhibits hereto, contains the entire agreement of the
parties with respect to the subject matter hereof.
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
12
<PAGE>
c. Controlling Law. This Agreement and the performance of the
----------------
obligations imposed upon the parties hereunder shall be governed by
and construed in accordance with the laws of the State of California,
to the exclusion of all other laws. The parties each
(I) confer sole and exclusive jurisdiction upon, and agree that
the proper venue of any such action shall be in, the courts
located in Orange County, California, in connection with all
disputes arising under or related to this Agreement, and
(ii) waive any and all objections that they may have with respect
to jurisdiction of, or venue in, such court.
d. Successors and Assigns. The provisions of this Agreement shall be
-----------------------
binding upon and insure to the benefit of MTI and Distributor and
their respective successors and permitted assigns. Distributor may
not assign this Agreement (by operation of law or otherwise) without
the prior written consent of MTI. MTI may assign this Agreement to its
subsidiaries or parent company or to any related company upon 30 days
advance written notice provided by MTI to the Distributor.
e. Confidentiality. The parties mutually agree that any confidential
----------------
information furnished to the other, so labeled or described shall
remain confidential and not be made available to any other party,
without written permission from the party furnishing said information.
f. Notices. Any notice required or permitted hereunder shall be given
--------
by mailing the same in a sealed envelope, postage paid and sent via
registered mail addressed as follows:
MTI: MOTORVAC TECHNOLOGIES, INC.
1431 S. Village Way
Santa Ana, California, USA 92705
Distributor: CAMEO (QLD) PTY. LTD.
121 Newmarket Road, Unit 3
Windsor, Queensland, 4030
Australia
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
13
<PAGE>
Either party may change its address for notices hereunder by written
notice to the other party.
g. Limitation of Liability. MTI's liability to Distributor hereunder
------------------------
with respect to any order, MTI's performance thereof, or the Products
sold hereunder shall not exceed the purchase price paid by Distributor
for the Products. In no event shall MTI be liable to Distributor for
special, incidental or consequential damages.
h. Extraordinary Circumstances. Except for any payment obligations of
----------------------------
either party hereunder, neither MTI nor Distributor shall be liable
for any delay or failure to perform on account of any cause beyond
such party's reasonable control, including, but not limited to, work
stoppages, work slow-downs, strikes or other industrial disputes;
fire, explosions, floods, earthquakes or other acts of God; riots or
civil disturbances, war or other acts of civil or military
authorities; and delays caused by suppliers or material shortages.
i. Changes to Products. The Distributor hereby agrees and
--------------------
acknowledges the Company may, at its sole discretion, withdraw or
replace or add products to Exhibit A or B attached hereto at any time.
The distributor waives any right or notice on such a change.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
MotorVac Technologies, Inc., Cameo (QLD) Pty. Ltd.
a Delaware corporation
By: /s/ LEE W. MELODY By: /s/ DAVID ELMSLIE
----------------------------- -------------------------------
Its: President Its: Director
----------------------------- -------------------------------
Date: 6/14/96 Date: 6-3-96
------------------------------ -------------------------------
INITIAL:
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REVISION DATE: 5/28/96
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THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
14
<PAGE>
EXHIBIT A
---------
PRODUCTS
--------
SUMMARY
-------
<TABLE>
<CAPTION>
PART # BRAND NAME
- ------ ----------
<C> <C>
500-0301 ECS-300i CarbonClean Gasoline Fuel System Cleaning
Machine
Includes: 200-3000 Basic Adaptor Kit
200-3000 Foreign Adaptor Kit
Instruction Manual
One Year Warranty
0500-4010 IDT 4000i CarbonClean Diesel Fuel System Cleaning
Machine
Includes: 200-3040 Adaptor Kit
User & Service Guide
One Year Warranty
400-0010 CarbonClean Diesel Fuel System Cleaner
(12) 16oz Cans
400-0020 CarbonClean Gasoline Fuel System Cleaner
(12) 8oz. Bottles
400-0030 CarbonClean Intake Cleaner (12) 8oz. Bottles
400-DRUM-D CarbonClean Diesel Fuel System Cleaner
55 Gallon Drum
400-DRUM-G CarbonClean Gasoline Fuel System Cleaner
55 Gallon Drum
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
15
<PAGE>
EXHIBIT A
---------
PRODUCTS
--------
EQUIPMENT AND SOLVENT
---------------------
<TABLE>
<CAPTION>
PART # DESCRIPTION
- ------ -----------
<C> <C>
400-0010 Diesel Fuel System Cleaner - (12) 16oz. Cans
1 case = 12" x 10" x 8" (15 lbs)
30.5cm x 25.4cm x 20.3cm (6.8 kg)
400-0020 Gasoline Fuel System Cleaner - (12) 8oz. Bottles
1 case = 9" x 7" x 6" (7 lbs)
22.8cm x 17.8cm x 15.2cm (3.2 kg)
400-0030 Intake Cleaning Solvent - (12) 8oz. Bottles
1 case = 9" x 7" x 6" (7 lbs)
22.8cm x 17.8cm x 15.2cm (3.2 kg)
200-6000 Intake Cleaning Kit - (12) 8oz Bottle & Sprayer
1 case = 17" x 17" x 11" (15 lbs)
43.2cm x 43.2cm x 27.9cm (6.8 kg)
400-DRUM-D Diesel Fuel System Cleaner - 55 Gallon Drum
24" x 24" x 35" (462 lbs)/61.0cm x 61.0cm x 88.9cm
(210 kg)
500-0301 ECS-300i Gasoline Fuel System Cleaning Machine
Includes: 200-3000 Basic Adaptor Kit
200-3009 Foreign Adaptor Kit
User Guide
One Year Warranty
16" x 15" x 38" (82 lbs)
40.6cm x 38.1cm x 96.5cm (37.2 kg)
500-4010 IDT 4000i Diesel Fuel System Cleaning Machine
Includes: 200-3040 Adaptor Kit
User and Service Guide
One Year Warranty
24" x 20" x 41" (115 lbs)
61.0cm x 50.8cm x 104cm (52.2 kg)
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
16
<PAGE>
<TABLE>
<C> <C>
500-0200 CCS II - CarbonClean System II
Includes: 200-8085 CCS II Basic Adaptor Kit
200-8059 CCS II - Deluxe Adaptor Kit
400-DRUM-G Gasoline Fuel System Cleaner - 55 Gallon Drum
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
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THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
17
<PAGE>
EXHIBIT A
---------
PRODUCTS
--------
CARBON CLEAN REPLACEMENT PARTS
-----------------------------
SERIES 200 & 300
<TABLE>
<CAPTION>
PART # DESCRIPTION
- ------ -----------
<S> <C>
010-0005B XOLOX SHIELD
010-0006B TANK CAP
010-0007B P-200 CASTER
010-0008B P-200 HANDLE
010-0009B TANK RESERVOIR
010-0017B ECS 300i OVERLAY
010-0019B ECS HANDLE
010-0020B ECS AXLE
010-0021B ECS WHEEL
010-0022B ECS BASE LEG
010-0024B ECS HOSE BRACKET
010-0025B ECS CORD BRACKET
020-0010B BUZZER
020-0030B EXTERNAL WIRING HARNESS
020-0035B 5 AMP CIRCUIT BREAKER
020-0037B 10 AMP CIRCUIT BREAKER
020-0038B 15 AMP CIRCUIT BREAKER
020-0040B INTERNAL WIRING HARNESS
020-0063B ELEC. LAMP AMBER
020-0067B ELEC. LAMP WHITE
020-0073B ELEC. LAMP GREEN
020-0083B ELEC. LAMP RED
020-0090B RELAY 8 TRIM, EAR MOUNT
020-0100B ONOFF & PS/LEAK SWITCH
020-0110B PURGE SWITCH, 1/2 MT
020-0120B START SWITCH, 1/2 MT
020-0150B TIMER 60 MIN 3/8 W/NUT
020-0151B TIMER FACE PLATE
020-0152B TIMER KNOB BLACK
020-0374B STRAIN RELIEF 1/2 MT
030-0002B F.CONN 1/4 X 1/8 FPT NI
030-0004B P-200 FM UNION 5/16 X 1/4 NT (NY)
030-0005B MALE ELBOW 1/4 X 1/4 MPT
030-0006B MALE ELBOW 1/4 X 1/8 MPT
030-0013B HEX NIPPLE 1/4 P NI
030-0015B MALE ELBOW 5/16 X 1/8 MPT NY
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
18
<PAGE>
<TABLE>
<CAPTION>
PART # DESCRIPTION
- ------ -----------
<C> <S>
030-0016B M. CONN 5/16 X 1/8 MPT NY
030-0017B M. CONN 5/16 X 1/4 MPT NY
030-0020B M. CONN 3/8 X 1/4 MPT NAB NI
030-0021B ECS F CONN 5/16 X 1/8 FPT NI
030-0022B F. CONN 5/16T X 1/4 P NI
030-0023B M. CONN 5/16T X 1/4 P NI
030-0024B M. ELBOW 5/16T X 1/8 NI
030-0025B M. CONN 3/8T X 1/4P NI
030-0026B ECS F. CONN 1/4 BARB X 1/8 NI
030-0030B F. CONN 3/8 X 1/4 FPT NI
030-0031B ELBOW 1/4 MPT X 1/4 FPT NI
030-0050B M. CONN 3/8 X 1/8 MPT NI
030-0090B P-200 JUNCTION BLOCK 2 WAY 1/8 FPT
030-0095B ECS JUNCTION BLOCK, 2 WAY 1/4
030-0100B P-200 JUNCTION BLOCK-5 WAY 1/8
030-0105B ECS JUNCTION BLOCK-5 WAY 1/4
030-0130B MALE ELBOW 3/8 X 1/4 MPT NI
030-0131B FEMALE ELBOW 3/8 X 1/4 MPT NI
030-0140B MALE ELBOW 3/8 X 1/8 MPT NI
030-0150B MALE ELBOW 5/16 X 1/4 MPT NI
030-0160B M. CONN 5/16 X 1/8 MPT NI
030-0189B F. CONN 1/4 FPT X MPT NI
030-0192B COMP ALIGN NUT 5/16
030-0205B P-200 CROSS 1/8 FPT NI
030-0206B CROSS 1/4 FPT NI
030-0208B J. CONN 3/8 X 1/4 MPT NI
030-0209B TEE 3/8 NT X 1/4 MPT X 3/8 (NY)
USED WITH VACUUM SWITCH
030-0210B UNION 1/8 MPT X 1/4 MPT (NY)
030-0211B F. CONN 90 3/8 X 1/4 FPT NY
040-0401B XOLOX PUMP MOUNT NUT
040-0500B ECS GRAB HANDLE LOCKWASHER
040-0502B ECS "E' CLIP FOR AXLE
040-0503B ECS AXLE SPACER
040-0505B ECS GRAB HANDLE NUT
040-0506B ECS LEG CAP
040-0507B ECS AXLE BUSHING NY
040-0508B ECS VAC HOSE SNAP BUSHING
040-0509B ECS GRAB HANDLE BOLT
040-5326B 3/32 X 4 NYLON CABLE TIE
050-0010B PSI GAUGE
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
19
<PAGE>
<TABLE>
<CAPTION>
PART # DESCRIPTION
- ------ -----------
<C> <S>
050-0011B BAR GAUGE
050-0012B ECS VACUUM GAUGE
050-0013B ECS BAR VACUUM GAUGE
050-0008B VACUUM SWITCH 1/4 MPT
050-0015B 3 WAY SOLENOID 3/32
050-0017B PRESSURE SWITCH 1/8
050-0021B STAINLESS CK VALUE
050-0052B REG NEEDLE VALVE
050-0065B CONTROL VALVE
050-0074B FILTER, INLINE
050-0075B FILTER, SPIN-ON
050-0076B FILTER & BASE 1/4 FPT
050-0088B RELIEF VALVE 105 PSI
060-0440B HOSE CLAMP
060-0450B HOSE CLAMP
060-1000B 1/4 MALE TUBE ADAPTOR
060-1100B 5/16 MALE TUBE ADAPTOR
060-1200B 3/8 MALE TUBE ADAPTOR
060-1300B 1/4 FEMALE ADAPTOR (Open-end hose)
060-1400B 5/16 FEMALE ADAPTOR (Open-end hose)
060-1500B 3/8 FEMALE ADAPTOR (Open-end hose)
060-1600B 12 MM BANJO
060-1700B 90 TUBE 5/16 MPT FUEL INLET ADAPTOR
060-1800B 90 TUBE 3/8 MPT FUEL INLET ADAPTOR
060-1900B 12 MM BANJO BOLT
060-1901B 12 MM WASHER
060-1902B 12 MM CAP NUT
060-2000B 5/16 LOOP MALE ADAPTOR
060-2100B 3/8 PLUG COLLAR
060-2101B 3/8 CARB PLUG ADAPTOR
060-2200B 5/16 PLUG COLLAR
060-2201B 5/16 CARB PLUG ADAPTOR
060-2300B 14 MM FEMALE
060-2400B 1C MM BANJO
060-2401B 8 MM BANJO
060-2402B 14 MM BANJO
060-2501B FQD LOOP ADAPTOR
060-2502B TEE
060-2600B 16 MM FEMALE
060-2720B 10 MM BANJO BOLT
060-2800B 1/4 MALE CONNECTOR (Ford,GM,Chrysler,Jeep)
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
20
<PAGE>
<TABLE>
<CAPTION>
PART # DESCRIPTION
- ------ -----------
<C> <S>
060-2900B 5/16 MALE NYLON (Ford,Lincoln,Mercury)
060-3000B 1/8 MPT ADAPTOR (Ford,Lincoln,Mercury)
060-3100B TBI & PFI INLET (GM)
060-3105B FEMALE SIDE OF 3100 (GM)
060-2700B 14 MM X 16 MM MALE UNION
060-2710B 8 MM BANJO BOLT
060-2711B 8 MM WASHER (Set of 3)
060-3200B 1/4 MPT ADAPTOR (Ford,Lincoln,Mercury)
060-3300B TBI & PFI OUTLET (GM)
060-3304B TBI & PFI USED W/1700 (GM)
060-3305B FEMALE SIDE OF 3300 (GM) (Replaces 060-4000)
060-3500B 3/8 MALE ADAPTOR (Ford,Lincoln,Mercury)
060-3505B 3/8 FEMALE ADAPTOR (Ford,Lincoln,Mercury)
060-3508B SHRADER VALVE (Ford,Lincoln,Mercury)
060-3600B 1/2 MALE ADAPTOR (Ford,Lincoln,Mercury)
060-3605B 1/2 FEMALE ADAPTOR (Ford,Lincoln,Mercury)
060-3700B SHRADER VALVE (GM,Chrysler,Jeep)
060-3800B VOLVO ADAPTOR
060-3900B 5/16 FQD (Ford,Lincoln,Mercury)
060-3901B 3/8 FQD (Ford,Lincoln,Mercury)
060-3902B 1/4 FQD (Ford,Lincoln,Mercury)
060-4100B HYUNDAI ADAPTOR
060-4200B 5/16 MALE METAL (GM,Chrysler,Jeep)
060-4205B 5/16 FQD (GM,Chrysler,Jeep)
060-4300B 3/8 MALE CONNECTOR(Ford,GM,Chrysler,Jeep)
060-4305B 3/8 FQD (GM,Chrysler,Jeep)
060-4405B 1/4 FQD (GM,Chrysler,Jeep)
070-0080B 1/4 NYLON TUBE
070-0085B 5/16 NYLON TUBE
070-0086B 3/8 NYLON TUBE
070-0100B HOSE VACUUM
080-0230B 1/4 FPT FQD NI
080-3301B O-RING VITON USED w/3304
080-3302B SM. O-RING VITON Used w/3300,3304
080-3402B LG. O-RING VITON Used w/3100,3500,4100
080-3501B SMALL CLIP & TETHER (Ford,Lincoln,Mercury)
080-3601B LARGE CLIP & TETHER (Ford,Lincoln,Mercury)
080-3602B O-RING VITON Used w/3600
080-3701B VITON SEAL,3700
080-3903B 5/16 RETAINER (Ford,Lincoln,Mercury)
080-3904B 3/8 RETAINER (Ford,Lincoln,Mercury)
</TABLE>
INITIAL:
-------
-------
REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
21
<PAGE>
<TABLE>
<CAPTION>
PART # DESCRIPTION
- ------ -----------
<C> <S>
080-3905B 1/4 RETAINER (Ford,Lincoln,Mercury)
080-4206B 5/16 RETAINER (GM,Chrysler,Jeep)
080-4306B 3/8 RETAINER (GM,Chrysler,Jeep)
080-4408B 1/4 RETAINER (GM,Chrysler,Jeep)
100-0090B ECS INTERNATIONAL MANUAL
100-0300B CHINESE OVERLAY
100-0104B FUEL INJECTOR PULSER IT100 (MQ)
100-4047B SPANNER NUT
100-4048B SPANNER WRENCH
100-5001B ICS TUBING (30")
200-0006B P-200 LOW FM ASSEMBLY
200-0007B P-200 HIGH FM ASSEMBLY
200-0011B P-200 BAR GAUGE ASSEMBLY
200-0050B P-200 2-WAY BLOCK ASSEMBLY
200-0064B P-200 5-WAY ASSEMBLY
200-0076B P-200 OUTPUT REGULATOR ASSEMBLY
(All"D"machines)
200-0083B P-200 RETURN REGULATOR ASSEMBLY
200-0093B TEE ASSEMBLY
200-0200B IN-LINE FILTER ASSEMBLY
200-0203B FILTER & TANK 5/16" ASSEMBLY
200-0204B TUTHILL FILTER & TANK 3/8" ASSEMBLY
200-0280B P-200 VACUUM SWITCH ASSEMBLY
200-0300B ECS/P-200 RETURN HOSE ASSEMBLY
200-0400B ECS/P-200 OUTPUT HOSE ASSEMBLY
200-0704B TUTHILL PUMP 5/16" ASSEMBLY
(With plumbing fittings)
200-0705B TUTHILL PUMP 3/8" ASSEMBLY
(With plumbing fittings)
200-0706B XOLOX PUMP ASSEMBLY
(With plumbing fittings)
200-0800B P-200 CONTROL VALVE ASSEMBLY
200-1002B ECS BAR GAUGE ASSEMBLY
200-1004B ECS BAR VACUUM GAUGE ASSEMBLY
200-1008B ECS 2-WAY ASSEMBLY
200-1010B ECS 5-WAY ASSEMBLY
200-1011B ECS OUTPUT REGULATOR ASSEMBLY
200-1012B ECS RETURN REGULATOR ASSEMBLY
200-1013B ECS CONTROL VALVE ASSEMBLY
200-1014B ECS TEE ASSEMBLY
200-1175B FUEL QD TOOL KIT
</TABLE>
INITIAL:
-------
-------
REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
22
<PAGE>
<TABLE>
<CAPTION>
PART # DESCRIPTION
- ------ -----------
<C> <S>
200-3000B BASIC ADAPTOR KIT
200-3006B FORD ADAPTOR KIT
200-3008B GM ADAPTOR KIT
200-3009B ASIAN/EURO ADAPTOR KIT
200-4007B TIMER ASSEMBLY
200-4008B FILTER & BASE 3/8" ASSEMBLY
200-4009B FILTER & BASE 5/16" ASSEMBLY
200-5000B SOLENOID REPAIR KIT
200-8009B P-200 REGULATOR RETROFIT
300-3000B BASIC ORGANIZER BAG (GREEN)
300-3006B FORD ORGANIZER BAG (RED)
300-3008B GM ORGANIZER BAG (BLUE)
300-3009B ASIAN/EURO ORGANIZER BAG (ORANGE)
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
23
<PAGE>
EXHIBIT A
---------
IDT 4000i REPLACEMENT PARTS
---------------------------
<TABLE>
<CAPTION>
PART # DESCRIPTION
- ------ -----------
<C> <S>
010-0034B TANK CAP
010-0026B WHEEL
010-0037B LEG
010-0040B FOOT GLIDE
010-0461B LOWER SENDING UNIT ADAPTOR
020-0049B ALARM HORN
020-4045B LOWER SENDING UNIT
020-0043B ELECTRICAL HARNESS, LOWER UNIT
020-0045B ELECTRICAL HARNESS, INTERNAL MAIN
020-0046B ELECTRICAL HARNESS, EXT. BATTERY
020-0047B ELECTRICAL HARNESS, EXT. SHUTDOWN
020-0091B RELAY
050-0018B PRESSURE SWITCH
050-0044B HYDRAULIC PUMP 12v (Diesel)
050-0086B FILTER ELEMENT REPLACEMENTS (20)
060-0590B FQD (Supply Tank)
060-0592B MQD (Supply Tank)
080-0230B FQD (Hose End)
100-0200B CHINESE OVERLAY
200-1471B OUTPUT HOSE ASSEMBLY
200-1472B RETURN HOSE ASSEMBLY
200-1960B UNIVERSAL ADAPTOR KIT
200-4003B OUTPUT SOLENOID ASSEMBLY
200-4004B PUMP ASSEMBLY
200-4031B ELECTRONIC HEAD ASSEMBLY
200-4032B FILTER ASSEMBLY
200-4038B PRESSURE SWITCH ASSEMBLY
</TABLE>
INITIAL:
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-------
REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
24
<PAGE>
EXHIBIT B
---------
PRICING
-------
EFFECTIVE JANUARY 1, 1996
Home Office:
1431 S. Village Way
Santa Ana, CA 92705
Tel: (714) 558-4822
Fax: (714) 558-2756
INITIAL:
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-------
REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
25
<PAGE>
EXHIBIT B
---------
PRICING
-------
F.O.B. WAREHOUSE
<TABLE>
<CAPTION>
PART # DESCRIPTION COST
- ------ ------------- --------
<C> <S> <C>
400-0010 Diesel Fuel System Cleaner - (12) 16oz Cans 95.00
1 case = 12" x 10" x 8" (15 lbs)
30.5cm x 25.4cm x 20.3cm (6.8 kg)
400-0020 Gasoline Fuel System Cleaner - (12) 8oz Bottles 62.00
1 case = 9" x 7" x 6" (7 lbs)
22.8cm x 17.8cm x 15.2cm (3.2 kg)
400-0030 Intake Cleaning Solvent - (12) 8oz Bottles 65.00
1 case = 9" x 7" x 6" (7 lbs)
22.8cm x 17.8cm x 15.2cm (3.2 kg)
200-6000 Intake Cleaning Kit - (12) 360.00
8oz Bottle & Sprayer
1 case = 17" x 17" x 11" (15 lbs)
43.2cm x 43.2cm x 27.9cm (6.8 kg)
400-DRUM-D Diesel Fuel System Cleaner - 55 Gallon Drum 2,050.00
24" x 24" x 35" (462 lbs)
61.0cm x 61.0cm x 88.9cm (210 kg)
500-0200 System II CarbonClean Machine w/Standard 825.00
Adaptor Set
200-8059 Adaptor Set - Deluxe for System II 150.00
(when purchased w/machine)
200-8059 Adaptor Set - Deluxe for System II 200.00
(when purchased without machine)
500-0307 ECS-300e Fuel System Cleaning Machine for Gasoline 1,495.00
Includes:
200-3000 Basic Adaptor Kit
200-3009 Euro/Asia Kit
User Guide
One Year Warranty
16" x 15" x 38" (82 lbs)
40.6cm x 38.1cm x 96.5cm (37.2 kg)
</TABLE>
INITIAL:
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-------
REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
26
<PAGE>
<TABLE>
<CAPTION>
<C> <S> <C>
500-4000i IDT-4000i Fuel System Cleaning Machine for Diesel 1,650.00
Includes:
200-3040 Adaptor Kit
User & Service Guide
One Year Warranty
23 1/4" x 18" x 39 1/2" (98 lbs.)
59.0cm x 45.7cm x 100.3cm (44.5 kg)
200-3006 U.S. Ford Adaptor Kit 315.00
200-3008 U.S. G.M. Adaptor Kit 197.00
400-DRUM-G Gasoline Fuel System Cleaner - 55 Gallon Drum 2,950.00
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
27
<PAGE>
EXHIBIT B
---------
CARBONCLEAN REPLACEMENT PARTS PRICING
-------------------------------------
SERIES 200 & 300
<TABLE>
<CAPTION>
PART # DESCRIPTION PRICE
- ------- -------------- ------
<S> <C> <C>
010-0005B XOLOX SHIELD 15.65
010-0006B TANK CAP 7.75
010-0007B P-200 CASTER 9.50
010-0008B P-200 HANDLE 18.75
010-0009B TANK RESERVOIR 105.00
010-0017B ECS 300i OVERLAY 28.25
010-0019B ECS HANDLE 45.00
010-0020B ECS AXLE 23.70
010-0021B ECS WHEEL 12.55
010-0022B ECS BASE LEG 14.60
010-0024B ECS HOSE BRACKET 11.80
010-0025B ECS CORD BRACKET 14.05
020-0010B BUZZER 18.00
020-0030B EXTERNAL WIRING HARNESS 25.00
020-0035B 5 AMP CIRCUIT BREAKER 7.05
020-0037B 10 AMP CIRCUIT BREAKER 7.05
020-0038B 15 AMP CIRCUIT BREAKER 7.05
020-0040B INTERNAL WIRING HARNESS 60.00
020-0063B ELEC. LAMP AMBER 4.75
020-0067B ELEC. LAMP WHITE 4.75
020-0073B ELEC. LAMP GREEN 4.75
020-0083B ELEC. LAMP RED 4.75
020-0090B RELAY 8 TRIM, EAR MOUNT 18.65
020-0100B ONOFF & PS/LEAK SWITCH 4.20
020-0110B PURGE SWITCH, 1/2 MT 6.30
020-0120B START SWITCH, 1/2 MT 11.55
020-0150B TIMER 60 MIN 3/8 W/NUT 26.80
020-0151B TIMER FACE PLATE 3.05
020-0152B TIMER KNOB BLACK 1.75
020-0374B STRAIN RELIEF 1/2 MT 0.25
030-0002B F.CONN 1/4 X 1/8 FPT NI 2.18
030-0004B P-200 FM UNION 5/16 X 1/4 NT (NY) 6.55
030-0005B MALE ELBOW 1/4 X 1/4 MPT 2.50
030-0006B MALE ELBOW 1/4 X 1/8 MPT 2.18
030-0013B HEX NIPPLE 1/4 P NI 1.45
030-0015B MALE ELBOW 5/16 X 1/8 MPT NY 5.25
</TABLE>
INITIAL:
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-------
REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
28
<PAGE>
<TABLE>
<CAPTION>
PART # DESCRIPTION PRICE
- ------- -------------- ------
<C> <S> <C>
030-0016B M. CONN 5/16 X 1/8 MPT NY 2.55
030-0017B M. CONN 5/16 X 1/4 MPT NY 2.65
030-0020B M. CONN 3/8 X 1/4 MPT NAB NI 2.33
030-0021B ECS F CONN 5/16 X 1/8 FPT NI 2.40
030-0022B F. CONN 5/16T X 1/4 P NI 3.30
030-0023B M. CONN 5/16T X 1/4 P NI 2.35
030-0024B M. ELBOW 5/16T X 1/8 NI 2.75
030-0025B M. CONN 3/8T X 1/4P NI 2.90
030-0026B ECS F. CONN 1/4 BARB X 1/8 NI 2.20
030-0030B F. CONN 3/8 X 1/4 FPT NI 2.89
030-0031B ELBOW 1/4 MPT X 1/4 FPT NI 2.26
030-0050B M. CONN 3/8 X 1/8 MPT NI 2.56
030-0090B P-200 JUNCTION BLOCK 2 WAY 1/8 FPT 8.50
030-0095B ECS JUNCTION BLOCK, 2 WAY 1/4 6.25
030-0100B P-200 JUNCTION BLOCK-5 WAY 1/8 10.50
030-0105B ECS JUNCTION BLOCK-5 WAY 1/4 8.25
030-0130B MALE ELBOW 3/8 X 1/4 MPT NI 3.10
030-0131B FEMALE ELBOW 3/8 X 1/4 MPT NI 4.39
030-0140B MALE ELBOW 3/8 X 1/8 MPT NI 2.91
030-0150B MALE ELBOW 5/16 X 1/4 MPT NI 2.88
030-0160B M. CONN 5/16 X 1/8 MPT NI 2.09
030-0189B F. CONN 1/4 FPT X MPT NI 1.95
030-0192B COMP ALIGN NUT 5/16 0.97
030-0205B P-200 CROSS 1/8 FPT NI 3.97
030-0206B CROSS 1/4 FPT NI 6.31
030-0208B J. CONN 3/8 X 1/4 MPT NI 3.96
030-0209B TEE 3/8 NT X 1/4 MPT X 3/8 (NY) 7.70
USED WITH VACUUM SWITCH
030-0210B UNION 1/8 MPT X 1/4 MPT (NY) 1.06
030-0211B F. CONN 90 3/8 X 1/4 FPT NY 6.12
040-0401B XOLOX PUMP MOUNT NUT 0.05
040-0500B ECS GRAB HANDLE LOCKWASHER 0.05
040-0502B ECS "E' CLIP FOR AXLE 0.10
040-0503B ECS AXLE SPACER 0.45
040-0505B ECS GRAB HANDLE NUT 0.05
040-0506B ECS LEG CAP 0.20
040-0507B ECS AXLE BUSHING NY 0.15
040-0508B ECS VAC HOSE SNAP BUSHING 0.10
040-0509B ECS GRAB HANDLE BOLT 0.10
040-5326B 3/32 X 4 NYLON CABLE TIE 0.05
050-0008B VACUUM SWITCH 1/4 MPT 61.75
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
29
<PAGE>
<TABLE>
<CAPTION>
PART # DESCRIPTION PRICE
- ------- -------------- ------
<C> <S> <C>
050-0010B PSI GAUGE 34.75
050-0011B BAR GAUGE 37.45
050-0012B ECS VACUUM GAUGE 37.45
050-0013B ECS BAR VACUUM GAUGE 38.75
050-0015B 3 WAY SOLENOID 3/32 68.52
050-0017B PRESSURE SWITCH 1/8 46.75
050-0021B STAINLESS CK VALUE 78.63
050-0052B REG NEEDLE VALVE 50.00
050-0065B CONTROL VALVE 45.00
050-0074B FILTER, INLINE 14.95
050-0075B FILTER, SPIN-ON 15.95
050-0076B FILTER & BASE 1/4 FPT 56.90
050-0088B RELIEF VALVE 105 PSI 74.48
060-0440B HOSE CLAMP 1.40
060-0450B HOSE CLAMP 1.50
060-1000B 1/4 MALE TUBE ADAPTOR 9.24
060-1100B 5/16 MALE TUBE ADAPTOR 9.94
060-1200B 3/8 MALE TUBE ADAPTOR 10.64
060-1300B 1/4 FEMALE ADAPTOR (Open-end hose) 7.21
060-1400B 5/16 FEMALE ADAPTOR (Open-end hose) 7.42
060-1500B 3/8 FEMALE ADAPTOR (Open-end hose) 7.63
060-1600B 12 MM BANJO 21.70
060-1700B 90 TUBE 5/16 MPT FUEL INLET ADAPTOR 16.10
060-1800B 90 TUBE 3/8 MPT FUEL INLET ADAPTOR 15.61
060-1900B 12 MM BANJO BOLT 8.00
060-1901B 12 MM WASHER 0.42
060-1902B 12 MM CAP NUT 4.00
060-2000B 5/16 LOOP MALE ADAPTOR 7.07
060-2100B 3/8 PLUG COLLAR 3.57
060-2101B 3/8 CARB PLUG ADAPTOR 9.31
060-2200B 5/16 PLUG COLLAR 2.38
060-2201B 5/16 CARB PLUG ADAPTOR 9.31
060-2300B 14 MM FEMALE 13.58
060-2400B 1C MM BANJO 16.80
060-2401B 8 MM BANJO 16.24
060-2402B 14 MM BANJO 22.82
060-2501B FQD LOOP ADAPTOR 37.00
060-2502B TEE 40.80
060-2600B 16 MM FEMALE 14.98
060-2700B 14 MM X 16 MM MALE UNION 13.30
060-2710B 8 MM BANJO BOLT 10.60
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
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THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
30
<PAGE>
<TABLE>
<CAPTION>
PART # DESCRIPTION PRICE
- ------- -------------- ------
<C> <S> <C>
060-2711B 8 MM WASHER (Set of 3) 0.28
060-2720B 10 MM BANJO BOLT 11.90
060-2800B 1/4 MALE CONNECTOR (Ford,GM,Chrysler,Jeep) 19.67
060-2900B 5/16 MALE NYLON (Ford,Lincoln,Mercury) 19.67
060-3000B 1/8 MPT ADAPTOR (Ford,Lincoln,Mercury) 9.87
060-3100B TBI & PFI INLET (GM) 21.00
060-3105B FEMALE SIDE OF 3100 (GM) 19.32
060-3200B 1/4 MPT ADAPTOR (Ford,Lincoln,Mercury) 9.87
060-3300B TBI & PFI OUTLET (GM) 22.86
060-3304B TBI & PFI USED W/1700 (GM) 9.95
060-3305B FEMALE SIDE OF 3300 (GM) (Replaces 060-4000) 19.32
060-3500B 3/8 MALE ADAPTOR (Ford,Lincoln,Mercury) 34.26
060-3505B 3/8 FEMALE ADAPTOR (Ford,Lincoln,Mercury) 19.74
060-3508B SHRADER VALVE (Ford,Lincoln,Mercury) 13.68
060-3600B 1/2 MALE ADAPTOR (Ford,Lincoln,Mercury) 34.56
060-3605B 1/2 FEMALE ADAPTOR (Ford,Lincoln,Mercury) 20.72
060-3700B SHRADER VALVE (GM,Chrysler,Jeep) 17.92
060-3800B VOLVO ADAPTOR 16.80
060-3900B 5/16 FQD (Ford,Lincoln,Mercury) 18.62
060-3901B 3/8 FQD (Ford,Lincoln,Mercury) 14.91
060-3902B 1/4 FQD (Ford,Lincoln,Mercury) 14.70
060-4100B HYUNDAI ADAPTOR 34.93
060-4200B 5/16 MALE METAL (GM,Chrysler,Jeep) 19.67
060-4205B 5/16 FQD (GM,Chrysler,Jeep) 19.10
060-4300B 3/8 MALE CONNECTOR(Ford,GM,Chrysler,Jeep) 19.67
060-4305B 3/8 FQD (GM,Chrysler,Jeep) 14.70
060-4405B 1/4 FQD (GM,Chrysler,Jeep) 19.67
070-0080B 1/4 NYLON TUBE 0.82ft
070-0085B 5/16 NYLON TUBE 1.18ft
070-0086B 3/8 NYLON TUBE 1.56ft
070-0100B HOSE VACUUM 0.75ft
080-0230B 1/4 FPT FQD NI 12.65
080-3301B O-RING VITON USED w/3304 0.55
080-3302B SM. O-RING VITON Used w/3300,3304 0.55
080-3402B LG. O-RING VITON Used w/3100,3500,4100 0.50
080-3501B SMALL CLIP & TETHER (Ford,Lincoln,Mercury) 4.00
080-3601B LARGE CLIP & TETHER (Ford,Lincoln,Mercury) 4.00
080-3602B O-RING VITON Used w/3600 0.60
080-3701B VITON SEAL,3700 4.25
080-3903B 5/16 RETAINER (Ford,Lincoln,Mercury) 0.30
080-3904B 3/8 RETAINER (Ford,Lincoln,Mercury) 0.30
</TABLE>
INITIAL:
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-------
REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
31
<PAGE>
<TABLE>
<CAPTION>
PART# DESCRIPTION PRICE
- ------- -------------- ------
<C> <S> <C>
080-3905B 1/4 RETAINER (Ford,Lincoln,Mercury) 0.40
080-4206B 5/16 RETAINER (GM,Chrysler,Jeep) 0.75
080-4306B 3/8 RETAINER (GM,Chrysler,Jeep) 0.80
080-4408B 1/4 RETAINER (GM,Chrysler,Jeep) 0.70
100-0090B ECS INTERNATIONAL MANUAL
100-0300B CHINESE OVERLAY 28.00
100-0104B FUEL INJECTOR PULSER IT100 (MQ) 144.00
100-4047B SPANNER NUT 5.00
100-4048B SPANNER WRENCH 12.00
100-5001B ICS TUBING (30") 0.75
200-0006B P-200 LOW FM ASSEMBLY 20.75
200-0007B P-200 HIGH FM ASSEMBLY 21.80
200-0011B P-200 BAR GAUGE ASSEMBLY 39.65
200-0050B P-200 2-WAY BLOCK ASSEMBLY 9.40
200-0064B P-200 5-WAY ASSEMBLY 119.31
200-0076B P-200 OUTPUT REGULATOR ASSEMBLY
(All"D"machines) 231.72
200-0083B P-200 RETURN REGULATOR ASSEMBLY 53.00
200-0093B TEE ASSEMBLY 16.35
200-0200B IN-LINE FILTER ASSEMBLY 14.95
200-0203B FILTER & TANK 5/16" ASSEMBLY 150.00
200-0204B TUTHILL FILTER & TANK 3/8" ASSEMBLY 160.00
200-0280B P-200 VACUUM SWITCH ASSEMBLY 62.95
200-0300B ECS/P-200 RETURN HOSE ASSEMBLY 27.00
200-0400B ECS/P-200 OUTPUT HOSE ASSEMBLY 27.00
200-0704B TUTHILL PUMP 5/16" ASSEMBLY
(With plumbing fittings) 215.00
200-0705B TUTHILL PUMP 3/8" ASSEMBLY
(With plumbing fittings) 215.00
200-0706B XOLOX PUMP ASSEMBLY
(With plumbing fittings) 215.00
200-0800B P-200 CONTROL VALVE ASSEMBLY 50.00
200-1002B ECS BAR GAUGE ASSEMBLY 39.95
200-1004B ECS BAR VACUUM GAUGE ASSEMBLY
200-1008B ECS 2-WAY ASSEMBLY 9.20
200-1010B ECS 5-WAY ASSEMBLY 198.50
200-1011B ECS OUTPUT REGULATOR ASSEMBLY 256.00
200-1012B ECS RETURN REGULATOR ASSEMBLY 53.00
200-1013B ECS CONTROL VALVE ASSEMBLY 50.00
200-1014B ECS TEE ASSEMBLY 20.45
200-1175B FUEL QD TOOL KIT 19.95
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
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THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
32
<PAGE>
<TABLE>
<CAPTION>
PART DESCRIPTION PRICE
- ------- -------------- ------
<C> <S> <C>
200-3000B BASIC ADAPTOR KIT 325.00
200-3006B FORD ADAPTOR KIT 315.00
200-3008B GM ADAPTOR KIT 197.00
200-3009B ASIAN/EURO ADAPTOR KIT 263.00
200-4007B TIMER ASSEMBLY 31.60
200-4008B FILTER & BASE 3/8" ASSEMBLY 59.55
200-4009B FILTER & BASE 5/16" ASSEMBLY 58.25
200-5000B SOLENOID REPAIR KIT 35.00
200-8009B P-200 REGULATOR RETROFIT 60.00
300-3000B BASIC ORGANIZER BAG (GREEN) 22.95
300-3006B FORD ORGANIZER BAG (RED) 22.95
300-3008B GM ORGANIZER BAG (BLUE) 22.95
300-3009B ASIAN/EURO ORGANIZER BAG (ORANGE) 22.95
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
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THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
33
<PAGE>
EXHIBIT B
---------
IDT 4000i REPLACEMENT PARTS PRICING
-----------------------------------
<TABLE>
<CAPTION>
PART # DESCRIPTION PRICE
- ------- ------------ ------
<C> <S> <C>
010-0034B TANK CAP 15.00
010-0026B WHEEL 12.50
010-0037B LEG 25.00
010-0040B FOOT GLIDE 3.75
010-0461B LOWER SENDING UNIT ADAPTOR 12.50
020-0049B ALARM HORN 22.50
020-4045B LOWER SENDING UNIT 81.25
020-0043B ELECTRICAL HARNESS, LOWER UNIT 12.50
020-0045B ELECTRICAL HARNESS, INTERNAL MAIN 87.50
020-0046B ELECTRICAL HARNESS, EXT. BATTERY 25.00
020-0047B ELECTRICAL HARNESS, EXT. SHUTDOWN 37.50
020-0091B RELAY 18.95
050-0018B PRESSURE SWITCH 50.00
050-0044B HYDRAULIC PUMP 12v (Diesel) 121.25
050-0086B FILTER ELEMENT REPLACEMENTS (20) 125.25
060-0590B FQD (Supply Tank) 24.96
060-0592B MQD (Supply Tank) 17.19
080-0230B FQD (Hose End) 12.65
100-0200B CHINESE OVERLAY 28.00
200-1471B OUTPUT HOSE ASSEMBLY 45.50
200-1472B RETURN HOSE ASSEMBLY 45.50
200-1960B UNIVERSAL ADAPTOR KIT 368.30
200-4003B OUTPUT SOLENOID ASSEMBLY 54.70
200-4004B PUMP ASSEMBLY 201.80
200-4031B ELECTRONIC HEAD ASSEMBLY 676.81
200-4032B FILTER ASSEMBLY 151.56
200-4038B PRESSURE SWITCH ASSEMBLY 49.70
</TABLE>
INITIAL:
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REVISION DATE: 5/28/96
--------------
THIS AGREEMENT IS INVALID UNLESS ALL PAGES ARE INITIALED BY THE COMPANY AND THE
DISTRIBUTOR AND EXHIBITS A AND B ARE ATTACHED
34
<PAGE>
MOTORVAC TECHNOLOGIES, INC.
CALCULATION OF PROFORMA NET LOSS PER SHARE
FOR THE THREE MONTHS ENDED JUNE 30, 1996 AND
FOR THE SIX MONTHS ENDED JUNE 30, 1996
<TABLE>
<CAPTION>
Three Months Three Months Six Months
Ended Ended Ended
March 31, 1996 June 30, 1996 June 30, 1996
-------------- -------------- ---------------
<S> <C> <C> <C>
Proforma Net Loss:
Net Loss (297,443) (254,643) (552,086)
Proforma Reduction of Interest Expense 106,263 26,153 132,416
-------------- -------------- ---------------
Proforma Net Loss (191,180) (228,490) (419,670)
============== ============== ===============
Proforma Weighted Average Outstanding Common and
Common Equivalent Shares:
Common Stock Outstanding December 31, 1995 948,000
Common stock equivalents:
Conversion of Series A Preferred Stock 966,247
Conversion of Series B Preferred Stock 570,150
Common Shares issued in Initial Public Offering 1,100,000
Conversion of $4,410,300 of Notes Payable to Related party 820,521
--------------
Common Stock Equivalents before below 4,404,918 4,404,918 4,404,918
Common stock issued in Overallotment on June 15, 1995 110,000 110,000
Weighting of overallotment Stock (15 days) 18,132 9,066
Incremental Shares, assuming exercise of options granted
after June 30, 1996 6,467 11,624 4,294
Incremental Shares Related to repayment of Interest 19,770 4,866 24,636
-------------- -------------- ---------------
Total Incremental Shares 26,237 34,622 37,996
-------------- -------------- ---------------
Proforma Weighted Average Outstanding Common and
Common Equivalent Shares 4,431,155 4,439,540 4,442,914
============== ============== ===============
Proforma Net Loss per Common Share and Common
Share equivalent (0.0431) (0.0515) (0.0945)
============== ============== ===============
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF MOTORVAC TECHNOLOGIES, INC. AS OF AND FOR
THE PERIOD ENDED JUNE 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> APR-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 4,140,414
<SECURITIES> 0
<RECEIVABLES> 1,117,720
<ALLOWANCES> 86,903
<INVENTORY> 1,265,927
<CURRENT-ASSETS> 6,554,675
<PP&E> 502,660
<DEPRECIATION> 236,025
<TOTAL-ASSETS> 8,336,215
<CURRENT-LIABILITIES> 1,462,977
<BONDS> 0
0
0
<COMMON> 45,149
<OTHER-SE> 16,527,629
<TOTAL-LIABILITY-AND-EQUITY> 8,336,215
<SALES> 1,823,311
<TOTAL-REVENUES> 1,823,311
<CGS> 1,029,357
<TOTAL-COSTS> 1,029,357
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 67,508
<INCOME-PRETAX> (254,643)
<INCOME-TAX> 0
<INCOME-CONTINUING> (254,643)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (254,643)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
