<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K/A NO. 2
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 28, 1997
AMERICAN TIRE CORPORATION
----------------------------
(Exact name of registrant as specified in its charter)
NEVADA 33-94318-C 87-0535207
- ---------------------------- ----------------------- --------------------
(State or other jurisdiction (Commission File Number) (IRS Employer ID No.)
of incorporation)
446 West Lake Street, Ravenna, Ohio 44266
- -------------------------------------------
(Address of principal executive office)
Registrant's telephone number, including area code: (330) 296-8778
--------------
N/A
------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE> 2
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS, AND EXHIBITS
(a)(1) Financial Statements of Business Acquired.
Financial Statements for UTI-UK for its fiscal years ended December 31,
1996, 1995, and 1994, as required under Item 310(3)(c) of Regulation S-B.
(b)(1) Pro Forma Financial Statements.
Pro forma financial information related to the acquisition of UTI-UK as
required under Item 310(3)(d) of Regulation S-B.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunder duly authorized.
AMERICAN TIRE CORPORATION
Date: January 14, 1998 /s/ Richard A. Steinke, C.E.O.
-----------------------------------
Richard A. Steinke, C.E.O.
<PAGE> 3
REPORT OF THE DIRECTORS AND
FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1996
FOR UTI CHEMICALS (EUROPE) LIMITED
UTI CHEMICALS (EUROPE) LIMITED
COMPANY INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1996
DIRECTORS: H. Sims-Hilditch
R. A. Steinke
SECRETARY: H. Sims-Hilditch
REGISTERED OFFICE: 50 West Street
Farmham, Surrey
GU9 7DX
REGISTERED NUMBER: 2546817
AUDITORS: Wise & Company
Chartered Accountants
Registered Auditors
50 West Street
Farmham, Surrey
GU9 7DX
<PAGE> 4
UTI CHEMICALS (EUROPE) LIMITED
REPORT OF THE DIRECTORS
FOR THE YEAR ENDED DECEMBER 31, 1996
The directors present their report with the financial statements of the
company for the year ended December 31, 1996.
PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of
promotion and development of products within the chemical industry, and the
sale of puncture proof tyres made from polyurethane.
REVIEW OF BUSINESS
The results for the year and financial position of the company are as shown
in the annexed financial statements.
DIVIDENDS
No dividends will be distributed for the year ended December 31, 1996.
EVENTS SINCE THE END OF THE YEAR
Information relating to events since the end of the year is given in the
financial statements.
DIRECTORS
The directors during the year under review were:
H. Sims-Hilditch
A. Welsh
The directors holding office at December 31, 1996 did not hold any beneficial
interest in the issued share capital of the company at January 1, 1996 or
December 31, 1996.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company and of the profit or loss of the company for that period. In
preparing those financial statements, the directors are required to:
- select suitable accounting policies and then apply them consistently;
- make judgments and estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it
is inappropriate to presume the company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and to enable them to ensure that the financial statements comply with
the Companies Act 1985. They are also responsible for safeguarding the assets
of the company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
AUDITORS
The auditors, WISE & CO., will be proposed for reappointment in accordance
with Section 385 of the Companies Act 1985.
ON BEHALF OF THE BOARD:
/s/ H. Sims-Hilditch, Secretary Dated: April 9, 1997
<PAGE> 5
UTI CHEMICALS(EUROPE)LIMITED
REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF
UTI CHEMICALS(EUROPE)LIMITED
We have audited the financial statements on pages four to fourteen which have
been prepared under the historical cost convention and the accounting policies
set out on page ten.
RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS
As described on page two, the company's directors are responsible for the
preparation of financial statements. It is our responsibility to form an
independent opinion, based on our audit, on those statements and to report our
opinion to you.
BASIS OF OPINION
We conducted our audit in accordance with Auditing Standards issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the financial statements.
It also includes an assessment of the significant estimates and judgments made
by the directors in preparation of the financial statements, and whether the
accounting policies are appropriate to the company's circumstances,
consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
OPINION
In our opinion the financial statements give a true and fair view of the state
of the company's affairs as at December 31, 1996 and of its profit for the
year then ended and have been properly prepared in accordance with the
Companies Act 1985.
Wise & Company
Chartered Accountants
Registered Auditors
50 West Street
Farmham, Surrey
GU9 7DX Dated: April 9, 1997
<PAGE> 6
<TABLE>
<CAPTION>
UTI CHEMICALS(EUROPE)LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED DECEMBER 31, 1996
12-31-96 12-31-95
------------------- -------------------
<S> <C> <C> <C> <C>
Notes * * * *
TURNOVER 2 261,524 282,324
Cost of Sales 113,289 119,028
------- -------
GROSS PROFIT 148,235 163,296
Distribution costs 49,157 46,026
Administrative expenses 96,293 85,193
------ ------
145,450 131,219
------- -------
OPERATING PROFIT 4 2,785 32,077
Interest receivable and 5 42 -
similar income ----- ------
PROFIT ON ORDINARY ACTIVITES
BEFORE TAXATION 2,827 32,077
Tax on profit on ordinary 6 416 -
activities ----- ------
PROFIT FOR THE FINANCIAL
YEAR AFTER TAXATION 2,411 32,077
Deficit brought forward (11,804) (43,881)
------ ------
DEFICIT CARRIED FORWARD (9,393) (11,804)
===== ======
</TABLE>
CONTINUING OPERATIONS
None of the company's activities were acquired or discontinued during the
current and previous years.
TOTAL RECOGNIZED GAINS AND LOSSES
The company has no recognized gains or losses other than the profits for the
current and previous years.
* All figures are in pounds sterling
The notes form part of these financial statements
<PAGE> 7
<TABLE>
<CAPTION>
UTI CHEMICALS(EUROPE)LIMITED
BALANCE SHEET
DECEMBER 31, 1996
12-31-96 12-31-95
------------------- -------------------
<S> <C> <C> <C> <C>
Notes * * * *
FIXED ASSETS:
Tangible assets 7 19,079 17,027
CURRENT ASSETS:
Stocks 8 99,115 67,352
Debtors 9 109,155 79,376
Cash at bank and in hand 19 2,649
------- -------
208,289 149,377
CREDITORS:
Amounts falling due
within one year 10 136,355 78,208
------- ------
NET CURRENT ASSETS: 71,934 71,169
------ ------
TOTAL ASSETS LESS
CURRENT LIABILITIES: 91,013 88,196
PROVISIONS FOR LIABILITIES
AND CHARGES: 13 406 -
------ ------
90,607 88,196
====== ======
CAPITAL AND RESERVES:
Called up share capital 14 100,000 100,000
Profit and loss account (9,393) (11,804)
------- -------
Shareholders' funds 18 90,607 88,196
====== ======
</TABLE>
ON BEHALF OF THE BOARD:
/s/ H. Sims-Hilditch, Director
Approved by the Board on April 9, 1997
* All figures are in pounds sterling
The notes form part of these financial statements
<PAGE> 8
<TABLE>
<CAPTION>
UTI CHEMICALS(EUROPE)LIMITED
CASH FLOW STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1996
12-31-96 12-31-95
------------------- -------------------
<S> <C> <C> <C> <C>
* * * *
Net cash outflow from
operating activities (24,278) (57,593)
Returns on investments and
servicing of finance
nterest received 42 -
------ ------
Net cash inflow from
returns on investments and
servicing of finance 42 -
TAXATION
Corporation tax paid - -
------ ------
Tax Paid - -
INVESTING ACTIVITIES
Purchase of tangible fixed assets (7,788) (2,281)
Sales of tangible fixed assets 1,200 30
------ ------
Net cash flow from
investing activities (6,588) (2,251)
------ ------
Net cash flow before
financing (30,824) (59,844)
Financing - -
------ ------
Net cash inflow from
financing - -
------ ------
Decrease in cash and
cash equivalents (30,824) (59,844)
====== ======
</TABLE>
* All figures are in pounds sterling
The notes form part of these financial statements
<PAGE> 9
<TABLE>
<CAPTION>
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE CASH FLOW STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1996
1. RECONCILIATION OF OPERATING PROFIT TO THE NET CASH FLOW FROM OPERATING
ACTIVITIES
12-31-96 12-31-95
------------------- -------------------
<S> <C> <C>
* *
Operating profit 2,785 32,077
Depreciation charges 4,559 4,735
Profit on sale of fixed assets (22) -
Increase in stocks (31,763) (18,804)
Increase in debtors (29,779) (58,692)
Increase/(decrease) in creditors 29,942 (16,909)
------ ------
Net cash flow from
operating activities (24,278) (57,593)
====== ======
</TABLE>
2. ANALYSIS OF CHANGES IN CASH AND CASH EQUIVALENTS DURING THE YEAR
YEAR ENDED DECEMBER 1, 1996
Balance at January 1, 1996 2,649
Net cash outflow (30,825)
------
Balance at December 31,1996 (28,176)
======
YEAR ENDED DECEMBER 31, 1995
Balance at January 1, 1995 62,493
Net cash outflow (59,844)
------
Balance at December 31, 1995 2,649
=====
<TABLE>
<CAPTION>
3. ANALYSIS OF THE BALANCES OF CASH AND CASH EQUIVALENTS AS SHOWN IN THE
BALANCE SHEET
12-31-96 1-1-96 Change in year
-------- ------ --------------
<S> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1996
Cash at bank and in hand 19 2,649 (2,630)
Bank overdrafts (28,195) - (28,195)
------ ----- ------
(28,176) 2,649 (30,825)
====== ===== ======
12-31-95 1-1-95 Change in year
-------- ------ --------------
<S> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1995
Cash at bank and in hand 2,649 62,493 (59,844)
===== ====== ======
</TABLE>
4. ANALYSIS OF CHANGES IN FINANCING DURING THE YEAR
There were no changes in financing during the year ended December 31, 1996 nor
during the year ended December 31, 1995.
<PAGE> 10
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1996
1. ACCOUNTING POLICIES
Accounting Convention
The financial statements have been prepared under the historical cost
convention.
Turnover
Turnover represents net invoiced sales of goods, excluding value added tax.
Tangible Fixed Assets
Depreciation is provided at the following annual rates in order to write off
each asset over its estimated useful life.
Plant & machinery - 25% on reducing balance
Fixtures and fittings - 15% on reducing balance
Motor vehicles - 25% on reducing balance
Stocks
Stock is valued at the lower of cost and net realizable value, after making
due allowance for obsolete and slow moving items.
Deferred Taxation
Provision is made at current rates for taxation deferred in respect of all
material timing differences except to the extent that, in the opinion of the
directors, there is reasonable probability that the liability will not arise
in the foreseeable future.
2. TURNOVER
The turnover and profit before taxation are attributable to the one principal
activity of the company.
3. STAFF COSTS
12-31-96 12-31-95
-------- --------
Wages and salaries 51,677 48,626
====== ======
Average monthly number
of employees during year in
administration and production 5 5
====== ======
4. OPERATING PROFIT
12-31-96 12-31-95
-------- --------
Operating profit is
stated after charging/(crediting):
Hire of plant and machinery 2,059 -
Depreciation - owned assets 4,559 4,734
Profit on disposal of
fixed assets (22) -
Auditors' renumeration 2,000 1,750
===== =====
Directors' emoluments 2,520 2,600
<PAGE> 11
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1996
5. INTEREST RECEIVABLE AND SIMILAR INCOME
12-31-96 12-31-95
-------- --------
Deposit account interest 42 -
===== =====
6. TAXATION
12-31-96 12-31-95
-------- --------
Tax charge on the profit
on ordinary activities:
UK Corporation Tax 10 -
Deferred taxation 406 -
----- -----
416 -
===== =====
UK Corporation Tax has been charged at 24.25% (1995-not applicable).
7. TANGIBLE FIXED ASSETS
<TABLE>
Plant & Fixtures & Motor
Machinery Fittings Vehicles Totals
--------- ---------- -------- ------
<C> <C> <C> <C>
<S>
COST:
At January 1, 1996 24,679 9,496 5,750 39,925
Additions - 3,793 3,995 7,788
Disposals - - (3,000) (3,000)
------ ----- ------ -----
At December 31, 1996 24,679 13,289 6,745 44,713
====== ====== ===== ======
DEPRECIATION:
At January 1, 1996 16,111 3,462 3,324 22,897
Charge for year 1,891 1,591 1,077 4,559
Eliminated on disposals - - (1,822) (1,822)
------ ----- ----- -----
18,002 5,053 2,579 25,634
At December 31, 1996 ====== ===== ===== ======
NET BOOK VALUE:
At December 31, 1996 6,677 8,236 4,166 19,079
===== ===== ===== ======
At December 31, 1995 8,568 6,033 2,426 17,027
===== ===== ===== ======
</TABLE>
8. STOCKS
12-31-96 12-31-95
-------- --------
Stock 99,115 67,352
====== ======
<PAGE> 12
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1996
9. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
12-31-96 12-31-95
-------- --------
Trade debtors 73,681 72,501
Prepayments & accrued income 1,903 3,953
Other debtors 5,316 2,922
Amounts owed by group companies 28,255 -
------ ------
109,155 79,376
======= ======
10. CREDITORS: AMOUNTS FALLING DUE WITHIN ON YEAR
12-31-96 12-31-95
-------- --------
Bank loans and overdrafts
(see note 11) 28,195 -
Trade creditors 47,926 16,268
Accruals 3,375 4,038
Other creditors 54,181 54,181
Amount owed to group companies - 2,982
Social security and other taxes 2,668 739
Taxation 10 -
------ ------
136,355 78,208
======= ======
11. LOANS AND OVERDRAFTS
An analysis of the maturity of loans and overdrafts is given below:
12-31-96 12-31-95
-------- --------
Amounts falling due within
one year or on demand - -
Bank overdrafts 28,195 -
====== ======
12. SECURED DEBTS
The following secured debts are included within creditors:
12-31-96 12-31-95
-------- --------
Bank overdrafts 28,195 -
====== ======
The bank overdraft facility is secured by a debenture on the Bank's standard
form dated August 1, 1996.
13. PROVISIONS FOR LIABILITIES AND CHARGES
12-31-96 12-31-95
-------- --------
Deferred taxation 406 -
====== ======
Accelerated capital allowances 406 -
------ ------
Balance at December 31, 1996 406 -
====== ======
<PAGE> 13
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1996
14. CALLED UP SHARE CAPITAL
Authorized, allotted, issued and fully paid:
Nominal
Number Class Value 12-31-96 12-31-95
- ------ ----- ------- -------- --------
100,000 Ordinary 1 100,000 100,000
15. ULTIMATE PARENT COMPANY
Coronel Investments Limited, a company incorporated in Jersey, is regarded by
the directors as being the company's ultimate parent company.
16. RELATED PARTY TRANSACTIONS
For the year under review, the company was under the control of its parent
company, Coronel Investments Limited. The directors are not aware of any
ultimately controlling party. H. Sims-Hilditch is the managing director of
Coronel Investments Limited and also UTI Chemicals Europe Limited.
Fees receivable for the year include 79,753 from Coronel Investments Limited.
At the balance sheet date, 28,255 was still owing from Coronel Investments.
H. Sims-Hilditch is also the managing director of Dateline Investments
Limited, a company incorporated in Jersey. Fees receivable for the year
include 2,000 from Dateline Investments Limited.
At the balance sheet date, 36,487 was still owing from Dateline Investments.
17. POST BALANCE SHEET EVENTS
Since the balance sheet date, the immediate holding company has been American
Tire Corporation, a company incorporated in Nevada, U.S.A.
18. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
12-31-96 12-31-95
-------- --------
Profit for the financial year 2,411 32,077
------ ------
Net addition to shareholders' funds 2,411 32,077
Opening shareholders' funds 88,196 56,119
------ ------
Closing Shareholders' Funds 90,607 88,196
====== ======
Equity Interests 90,607 88,196
====== ======
<PAGE> 14
REPORT OF THE DIRECTORS AND
FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1995
FOR UTI CHEMICALS (EUROPE) LIMITED
UTI CHEMICALS (EUROPE) LIMITED
COMPANY INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1995
DIRECTORS: H. Sims-Hilditch
A. Welsh
SECRETARY: H. Sims-Hilditch
REGISTERED OFFICE: 50 West Street
Farmham, Surrey
GU9 7DX
REGISTERED NUMBER: 2546817
AUDITORS: Wise & Company
Chartered Accountants
Registered Auditors
50 West Street
Farmham, Surrey
GU9 7DX
<PAGE> 15
UTI CHEMICALS (EUROPE) LIMITED
REPORT OF THE DIRECTORS
FOR THE YEAR ENDED DECEMBER 31, 1995
The directors present their report with the financial statements of the
company for the year ended December 31, 1995.
PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of
promotion and development of products within the chemical industry.
REVIEW OF BUSINESS
The results for the year and financial position of the company are as shown
in the annexed financial statements.
DIVIDENDS
No dividends will be distributed for the year ended December 31, 1995. The
retained profit transferred to reserves will be 32,077.
DIRECTORS
The directors during the year under review were:
H. Sims-Hilditch
A. Welsh
The directors holding office at December 31, 1995 did not hold any beneficial
interest in the issued share capital of the company at January 1, 1995 or
December 31, 1995.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company and of the profit or loss of the company for that period. In
preparing those financial statements, the directors are required to:
- select suitable accounting policies and then apply them consistently;
- make judgments and estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it
is inappropriate to presume the company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and to enable them to ensure that the financial statements comply with
the Companies Act 1985. They are also responsible for safeguarding the assets
of the company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
AUDITORS
The auditors, WISE & CO., will be proposed for reappointment in accordance
with Section 385 of the Companies Act 1985.
ON BEHALF OF THE BOARD:
/s/ H. Sims-Hilditch, Secretary Dated: July 11, 1996
<PAGE> 16
UTI CHEMICALS(EUROPE)LIMITED
REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF
UTI CHEMICALS(EUROPE)LIMITED
We have audited the financial statements on pages five to thirteen which have
been prepared under the historical cost convention and the accounting policies
set out on page ten.
RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS
As described on page two, the company's directors are responsible for the
preparation of financial statements. It is our responsibility to form an
independent opinion, based on our audit, on those statements and to report our
opinion to you.
BASIS OF OPINION
We conducted our audit in accordance with Auditing Standards issued by the
Auditing Practices Board, except that the scope of our work was limited as
explained below.
An audit includes examination, on a test basis, of evidence relevant to the
amounts and disclosures in the financial statements. It also includes an
assessment of the significant estimates and judgments made by the directors in
preparation of the financial statements, and whether the accounting policies
are appropriate to the company's circumstances, consistently applied and
adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. However, the evidence available to us to support stock
at December 31, 1994 was limited. We are unable to confirm the opening stock
stated at 48,548 and the financial statements for the year ended December 31,
1994 were qualified in this respect. Any adjustment to this figure would have
a consequential significant effect on the profit for the year.
In forming our opinion we also evaluated the overall adequacy of the
presentation of information in the financial statements.
QUALIFIED OPINION ARISING FROM LIMITATIONS IN AUDIT SCOPE
In our opinion the financial statements give a true and fair view of the state
of the company's affairs as at December 31, 1995.
Except for any adjustments that might have been found necessary had we been
able to obtain sufficient evidence concerning opening stock, in our opinion
the accounts give a true and fair view of the company's profit for the year
ended December 31, 1995 and have been properly prepared in accordance with the
Companies Act 1985.
In respect solely of the limitation on our work relating to opening stock;
proper accounting records have not been maintained; and we have not obtained
all the information and explanations that we consider necessary for the
purpose of our audit.
<PAGE> 17
UTI CHEMICALS(EUROPE)LIMITED
REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF
UTI CHEMICALS(EUROPE)LIMITED
Wise & Company
Chartered Accountants
Registered Auditors
50 West Street
Farmham, Surrey
GU9 7DX Dated: July 7, 1996
<PAGE> 18
<TABLE>
<CAPTION>
UTI CHEMICALS(EUROPE)LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED DECEMBER 31, 1995
12-31-95 12-31-94
-------- --------
<S> <C> <C> <C> <C>
Notes * * * *
TURNOVER 2 282,324 302,409
Cost of Sales 119,028 141,824
------- -------
GROSS PROFIT 163,296 160,585
Distribution costs 46,026 47,860
Administrative expenses 85,193 118,843
------ -------
131,219 166,703
------- -------
OPERATING PROFIT/(LOSS) 32,077 (6,118)
ON ORDINARY ACTIVITIES
BEFORE TAXATION 4 - -
Tax on profit/(loss) on ordinary
activities 5 - 6
------ ------
PROFIT/(LOSS)FOR THE FINANCIAL
YEAR AFTER TAXATION 32,077 (6,124)
Deficit brought forward (43,881) (37,757)
------ ------
DEFICIT CARRIED FORWARD (11,804) (43,881)
====== ======
</TABLE>
CONTINUING OPERATIONS
None of the company's activities were acquired or discontinued during the
current and previous years.
TOTAL RECOGNIZED GAINS AND LOSSES
The company has no recognized gains or losses other than the profits for the
current and previous years.
* All figures are in pounds sterling
The notes form part of these financial statements
<PAGE> 19
<TABLE>
<CAPTION>
UTI CHEMICALS(EUROPE)LIMITED
BALANCE SHEET
DECEMBER 31, 1995
12-31-95 12-31-94
-------- --------
<S> <C> <C> <C> <C>
Notes * * * *
FIXED ASSETS:
Tangible assets 6 17,027 19,510
CURRENT ASSETS:
Stocks 7 67,352 48,548
Debtors 8 79,376 20,683
Cash at bank and in hand 2,649 62,493
------- ------
149,377 131,724
CREDITORS:
Amounts falling due
within one year 9 78,208 95,115
------ ------
NET CURRENT ASSETS: 71,169 36,609
------ ------
TOTAL ASSETS LESS
CURRENT LIABILITIES: 88,196 56,119
====== ======
CAPITAL AND RESERVES:
Called up share capital 10 100,000 100,000
Profit and loss account (11,804) (43,881)
------- -------
Shareholders' funds 12 88,196 56,119
====== ======
</TABLE>
ON BEHALF OF THE BOARD:
/s/ H. Sims-Hilditch, Director
Approved by the Board on July 11, 1996
* All figures are in pounds sterling
The notes form part of these financial statements
<PAGE> 20
<TABLE>
<CAPTION>
UTI CHEMICALS(EUROPE)LIMITED
CASH FLOW STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1995
12-31-95 12-31-94
-------- --------
<S> <C> <C> <C> <C>
* * * *
Net cash outflow from
operating activities (57,593) 25,575
Returns on investments and
servicing of finance - -
- -
Net cash inflow from
returns on investments and
servicing of finance
- - -
TAXATION
Corporation tax paid - (6)
------ ------
Tax paid
- - (6)
INVESTING ACTIVITIES
Purchase of tangible fixed assets (2,281) (3,961)
Sales of tangible fixed assets 30 -
------ ------
Net cash flow from
investing activities (2,251) (3,961)
------ ------
Net cash (outflow)/inflow before
financing (59,844) 21,608
Financing
Cash receipt re share issue - 25,000
------ ------
Net cash inflow from
financing - 25,000
------ ------
Decrease in cash and
cash equivalents (59,844) 46,608
====== ======
</TABLE>
* All figures are in pounds sterling
The notes form part of these financial statements
<PAGE> 21
<TABLE>
<CAPTION>
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE CASH FLOW STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1995
1. RECONCILIATION OF OPERATING PROFIT/(LOSS) TO THE NET CASH FLOW FROM
OPERATING ACTIVITIES
12-31-95 12-31-94
-------- --------
<S> <C> <C>
* *
Operating profit/(loss) 32,077 (6,118)
Depreciation charges 4,735 6,009
Increase in stocks (18,804) (13,382)
Increase in debtors (58,692) (18,071)
Increase/(decrease) in creditors (16,909) 57,137
------ ------
Net cash flow from
operating activities (57,593) 25,575
====== ======
</TABLE>
2. ANALYSIS OF CHANGES IN CASH AND CASH EQUIVALENTS DURING THE YEAR
YEAR ENDED DECEMBER 1, 1995
Balance at January 1, 1995 62,493
Net cash outflow (59,844)
------
Balance at December 31,1995 2,649
======
YEAR ENDED DECEMBER 31, 1994
Balance at January 1, 1994 15,885
Net cash outflow 46,608
------
Balance at December 31, 1995 62,493
======
<TABLE>
<CAPTION>
3. ANALYSIS OF THE BALANCES OF CASH AND CASH EQUIVALENTS AS SHOWN IN THE
BALANCE SHEET
12-31-95 1-1-95 Change in year
-------- ------- --------------
<S> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1995
Cash at bank and in hand 2,649 62,493 (59,844)
===== ====== ======
12-31-94 1-1-94 Change in year
-------- ------- --------------
<S> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1994
Cash at bank and in hand 62,493 15,885 46,608
====== ====== ======
</TABLE>
4. ANALYSIS OF CHANGES IN FINANCING DURING THE YEAR
Year ended December 31, 1995
Share Capital
-------------
Balance at January 1, 1995 100,000
Share capital issued at par -
-------
Balance at December 31, 1995 100,000
=======
<PAGE> 22
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE CASH FLOW STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1995
Year ended December 31, 1994
Share Capital
-------------
Balance at January 1, 1994 75,000
Share capital issued at par 25,000
------
Balance at December 31, 1994 100,000
=======
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1995
1. ACCOUNTING POLICIES
Accounting Convention
The financial statements have been prepared under the historical cost
convention.
Turnover
Turnover represents net invoiced sales of goods, excluding value added tax.
Tangible Fixed Assets
Depreciation is provided at the following annual rates in order to write off
each asset over its estimated useful life.
Plant & machinery - 25% on reducing balance
Fixtures and fittings - 15% on reducing balance
Motor vehicles - 25% on reducing balance
Stocks
Stock is valued at the lower of cost and net realizable value, after making
due allowance for obsolete and slow moving items.
Deferred Taxation
Provision is made at current rates for taxation deferred in respect of all
material timing differences except to the extent that, in the opinion of the
directors, there is reasonable probability that the liability will not arise
in the foreseeable future.
2. TURNOVER
The turnover and profit (1994 - loss) before taxation are attributable to the
one principal activity of the company.
3. STAFF COSTS
12-31-95 12-31-94
-------- --------
Wages and salaries 48,626 47,860
====== ======
Average weekly number
of employees during year in
administration and production 5 5
====== ======
4. OPERATING PROFIT
12-31-95 12-31-94
-------- --------
Operating profit (1994 -
loss) is stated
after charging:
Depreciation - owned assets 4,734 6,009
Auditors' remuneration 1,750 1,750
===== =====
Directors' emoluments 2,600 -
===== =====
<PAGE> 23
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1995
5. TAXATION
12-31-95 12-31-94
-------- --------
Tax charge on the profit on
ordinary activities, based on
the adjusted results of the year:
Under Provision of Taxation -
6 ======
======
6. TANGIBLE FIXED ASSETS
<TABLE>
Plant & Fixtures & Motor
Machinery Fittings Vehicles Totals
--------- ---------- -------- ------
<C> <C> <C> <C>
<S>
COST:
At January 1, 1995 23,995 7,936 5,750 37,681
Additions 683 1,598 - 2,281
Disposals - (39) - (39)
------ ----- ----- -----
At December 31, 1995 24,678 9,495 5,750 39,923
====== ===== ===== ======
DEPRECIATION:
At January 1, 1995 13,255 2,401 2,515 18,171
Charge for year 2,855 1,070 809 4,734
Eliminated on disposals - (9) - (9)
------ ----- ----- -----
At December 31, 1995 16,110 3,462 3,324 22,896
====== ===== ===== ======
NET BOOK VALUE:
At December 31, 1995 8,568 6,033 2,426 17,027
===== ===== ===== ======
At December 31, 1994 10,740 5,535 3,235 19,510
====== ===== ===== ======
</TABLE>
7. STOCKS
12-31-95 12-31-94
-------- --------
Stock 67,352 48,548
====== ======
<PAGE> 24
UTI CHEMICALS(EUROPE)LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1995
8. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
12-31-95 12-31-94
-------- --------
Trade debtors 72,501 12,945
Prepayments & accrued income 3,953 3,126
Other debtors 2,922 4,612
------ ------
79,376 20,683
====== ======
9. CREDITORS: AMOUNTS FALLING DUE WITHIN ON YEAR
12-31-95 12-31-94
-------- --------
Trade creditors 16,268 12,988
Accruals 4,038 4,750
Other creditors 54,181 -
Amount owed to group companies 2,982 49,482
Directors Loan Accounts - 16,778
Social security and other taxes 739 11,117
------ ------
78,208 95,115
====== ======
10. CALLED UP SHARE CAPITAL
Authorized, allotted, issued and fully paid:
Nominal
Number Class Value 12-31-95 12-31-94
- ------ ----- ------- -------- --------
100,000 Ordinary 1 100,000 100,000
11. ULTIMATE PARENT COMPANY
Coronel Investments Limited, a company incorporated in Jersey, is regarded by
the directors as being the company's ultimate parent company.
12. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
12-31-95 12-31-94
-------- --------
Profit/(Loss) for the financial year 32,077 (6,124)
Issue of share capital - 25,000
------ ------
Net addition to shareholders' funds 32,077 18,876
Opening shareholders' funds 56,119 37,243
------ ------
Closing Shareholders' Funds 88,196 56,119
====== ======
Equity Interests 88,196 56,119
====== ======
<PAGE> 25
ACCOUNTANTS' REPORT
Board of Directors
UTI Chemicals (Europe) Limited
The accompanying balance sheets of UTI Chemicals (Europe) Limited as of
December 31, 1996 and 1995 and the related statements of operations for the
years ended December 31, 1996 and 1995 were not audited by us and,
accordingly, we do not express an opinion on them.
Jones, Jensen & Company
September 23, 1997
<PAGE> 26
UTI CHEMICALS (EUROPE) LIMITED
Balance Sheets
(Unaudited)
[All figures are in US Dollars]
ASSETS
- ------
December 31,
-------------------------
1996 1995
----------- -----------
CURRENT ASSETS
Cash and cash equivalents $ 32 $ 4,106
Accounts receivable 185,564 123,033
Inventory 168,496 104,395
----------- -----------
Total Current Assets 354,092 231,534
----------- -----------
PROPERTY AND EQUIPMENT - NET 35,196 26,392
----------- -----------
TOTAL ASSETS $ 389,288 $ 257,926
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
December 31,
-------------------------
1996 1995
----------- -----------
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 140,386 $ 37,241
Related party payables 92,108 83,981
----------- -----------
Total Current Liabilities 232,494 121,222
----------- -----------
STOCKHOLDERS' EQUITY
Share capital, 100,000 shares issued and
outstanding 170,000 155,000
Accumulated deficit (13,491) (18,296)
Foreign currency translation adjustment 285 -
----------- -----------
Total Stockholders' Equity 156,794 136,704
----------- -----------
TOTAL LIABILITY AND STOCKHOLDERS' EQUITY $ 389,288 $ 257,926
=========== ===========
See Accountants' Report
<PAGE> 27
UTI CHEMICALS (EUROPE) LIMITED
Statements of Operations
(Unaudited)
[All figures are in US Dollars]
ASSETS
- ------
December 31,
-------------------------
1996 1995
----------- -----------
NET SALES $ 305,611 $ 313,602
COST OF SALES 192,592 184,493
----------- -----------
GROSS MARGIN 113,019 129,109
----------- -----------
EXPENSES
Selling, general and administrative 232,541 192,725
Depreciation and amortization 7,750 7,339
----------- -----------
Total Expenses 240,291 200,064
----------- -----------
LOSS BEFORE OTHER INCOME (EXPENSES) (127,272) (70,955)
----------- -----------
OTHER INCOME (EXPENSES)
Consulting income 138,980 124,000
Interest income 71 -
Interest expense (7,011) (3,325)
Gain on sale of asset 37 -
----------- -----------
Total Other Income (Expenses) 132,077 120,675
----------- -----------
Net Income Before Income Taxes 4,805 49,720
Income Tax Expense - -
----------- -----------
NET INCOME $ 4,805 $ 49,720
=========== ===========
See Accountants' Report
<PAGE> 28
AMERICAN TIRE CORPORATION
Proforma Consolidated Statement of Operations
June 30, 1996
[All figures are in US Dollars]
(Unaudited)
For the Year Ended
June 30, 1996
----------- ----------- -----------
American UTI Chemicals
Tire (Europe) Proforma
Corporation Limited Combined
----------- ----------- -----------
NET SALES $ - $ 311,205 $ 311,205
COST OF SALES - 186,923 186,923
----------- ----------- -----------
GROSS MARGIN - 124,282 124,282
----------- ----------- -----------
EXPENSES
Consulting 43,261 - 43,261
Payroll and payroll taxes 222,757 75,008 297,765
Administrative 190,864 97,024 287,888
Travel and entertainment 55,554 30,795 86,349
Marketing consulting - 1,843 1,843
Depreciation expense 37,994 7,463 45,457
----------- ----------- -----------
Total Expenses 550,430 212,133 762,563
----------- ----------- -----------
LOSS BEFORE OTHER INCOME
(EXPENSES) (550,430) (87,851) (638,281)
----------- ----------- -----------
OTHER INCOME (EXPENSES)
Other income (expenses) - 127,570 127,570
Interest income 8,161 21 8,182
Interest expense (53,821) (4,431) (58,252)
----------- ----------- -----------
Total Other Income
(Expenses) (45,660) 123,160 77,500
----------- ----------- -----------
NET INCOME $ (596,090) $ 35,309 $ (560,781)
=========== =========== ===========
LOSS PER SHARE $ (0.15) $ 0.01 $ (0.14)
=========== =========== ===========
<PAGE> 29
AMERICAN TIRE CORPORATION
Proforma Consolidated Statement of Operations
March 31, 1997
[All figures are in US Dollars]
(Unaudited)
For the Nine Months Ended
March 31, 1997
----------- ----------- -----------
American UTI Chemicals
Tire (Europe) Proforma
Corporation Limited Combined
----------- ----------- -----------
NET SALES $ 25,637 $ 262,013 $ 287,650
COST OF SALES 8,439 158,878 167,317
----------- ----------- -----------
GROSS MARGIN 17,198 103,135 120,333
----------- ----------- -----------
EXPENSES
Consulting 140,690 - 140,690
Payroll and payroll taxes 344,253 81,835 426,088
Administrative 233,281 95,642 328,923
Travel and entertainment 35,741 26,883 62,624
Marketing consulting - 600 600
Depreciation expense 37,508 7,178 44,686
----------- ----------- -----------
Total Expenses 791,473 212,138 1,003,611
----------- ----------- -----------
LOSS BEFORE OTHER INCOME
(EXPENSES) (774,275) (109,003) (883,278)
----------- ----------- -----------
OTHER INCOME (EXPENSES)
Other income (expenses) - 97,312 97,312
Interest income 13,492 50 13,542
Interest expense (24,508) (8,738) (33,246)
----------- ----------- -----------
Total Other Income
(Expenses) (11,016) 88,624 77,608
----------- ----------- -----------
NET INCOME $ (785,291) $ (20,379) $ (805,670)
=========== =========== ===========
LOSS PER SHARE $ (0.19) $ (0.00) $ (0.19)
=========== =========== ===========
