SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB/A
/X/Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the Fiscal Year
Ended January 2, 1999
Commission File Number: 000-24477
TITAN MOTORCYCLE CO.
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OF AMERICA
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(Name of small business issuer in its charter)
Nevada 86-0776876
- ------------------------------ -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2222 West Peoria Avenue
Phoenix, Arizona 85029
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (602) 861-6977
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Securities registered under Section 12(g) of the Exchange Act: common stock
Check whether the issuer (1) filed all reports required to be filed by
section 13 or 15(d) of the Exchange Act 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
--- ---
Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of registrant's knowledge, in definitive proxy or
informational statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB [ ]
State issuer's revenues for its most recent fiscal year $ 27,913,025
Titan Motorcycle Co. of America
Consolidated Balance Sheet
As of January 2, 1999
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January 2, 1999
Assets
Current Assets:
Cash $ 8,398
Accounts receivable, net of allowance for sales returns of $50,000 3,184,738
Accounts receivable - related party 1,465,624
Inventories 11,838,002
Prepaid expenses 718,459
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Total current assets 17,215,221
Property and equipment, net 1,082,779
Other assets 60,912
Trademarks 61,311
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Total assets $ 18,420,223
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Liabilities and Stockholders' Equity
Current Liabilities:
Bank overdraft $ 77,737
Accounts payable 3,081,992
Accrued expenses 950,562
Current portion of note payable 599,993
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Total current liabilities 4,710,284
Notes payable 8,249,311
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Total liabilities 12,959,595
Commitments and contingencies
Stockholders' Equity
Common stock, par value $.001; 100,000,000 shares
authorized and 16,437,333 shares issued and outstanding 16,438
Additional paid-in capital 7,272,417
Unearned compensation (38,741)
Accumulated deficit (1,789,486)
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Total stockholders' equity 5,460,628
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Total liabilities and stockholders' equity $ 18,420,223
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THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
26
Titan Motorcycle Co. of America
Consolidated Statements of Cash Flows
For the Years ended January 2, 1999 and December 31, 1997
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January 2, December 31,
1999 1997
Cash flows from operating activities:
Net income (loss) $ 237,479 $(1,673,743)
Adjustments to reconcile net income (loss)
to net cash used:
Depreciation and amortization 167,621 89,994
Cumulative effect of change in accounting principle (38,603)
Stock compensation expense 3,134
Net changes in balance sheet accounts:
Accounts receivable (3,675,901) (234,087)
Inventories (5,314,639) (5,013,787)
Other assets 18,908 (423,374)
Accounts payable 1,029,260 1,587,530
Accrued expenses 504,231 110,858
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Net cash used in operating activities (7,068,510) (5,556,609)
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Cash flows from investing activities:
Purchases of property and equipment (626,769) (620,844)
Purchase of trademarks (8,852)
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Net cash used in investing activities (635,621) (620,844)
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Cash flows from financing activities:
Bank overdraft 77,737
Issuance of stock 500,000 4,000,000
Borrowings from related parties -- 1,426,142
Line of credit 7,049,324
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Net cash provided by financing activities 7,627,061 5,426,142
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Net decrease in cash (77,070) (751,311)
Cash and cash equivalents at beginning of year 85,468 836,779
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Cash and cash equivalents at end of year $ 8,398 $ 85,468
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Supplemental cash flow information:
Cash paid for:
Interest $ 251,593 $ --
Income taxes $ -- $ --
Non-cash Investing and Financing Activities:
Stock issued in exchange for advertising $ 250,000 $ --
Inventory in exchange for advertising $ 112,305 $ 124,309
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
29
1998 1997
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Federal income tax rate 34.0% 34.0%
State income tax rate, net of federal benefit 6.0% 6.0%
Non-deductable expenses 7.6%
Effect of valuation allowance (47.6%) (40.0%)
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Effective income tax rate 0% 0%
====================================
The income tax effects of loss carryforwards, tax credit carryforwards
and temporary differences between financial and tax reporting give rise
to the deferred income assets and liabilities. Management believes it
more likely than not that the Company will not realize its tax assets,
and as such, a full valuation allowance is recorded. Deferred income
tax asset (liabilities) at January 2, 1999, consist of the following:
Current:
Allowance for bad debts and sales returns $ 30,160
Inventories 25,941
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56,101
Long-term
Property and equipment (39,748)
Net operating loss carryforwards 617,372
Other 96,799
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730,524
Valuation Allowance (730,524)
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-
Net deferred tax asset ===============
As of January 2, 1999, the Company has federal and state net operating
loss carryforwards of approximately $1,545,930. The federal net
operating loss carryforwards expire in 2011, while the state net
operating loss carryforwards expire in 2002.
7. Related Party Transactions and Balances
The Company has transactions in the normal course of business with
affiliated dealerships that are partially owned by majority
shareholders of the Company. In 1998 and 1997, sales to these
affiliated dealerships were $6,260,963 and $638,290, respectively. At
January 2, 1999, accounts receivable from these affiliated dealerships
were $1,465,624.
8. Commitments and Contingencies
The Company leases its office, manufacturing and warehouse space. Total
rent expense for 1998 and 1997 was $387,201 and $230,824, respectively.
Future minimum lease payments required under the operating lease
agreements are as follows:
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SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized.
Titan Motorcycle Company of America
Date: 4/26/99 By: /s/ Franks S. Keery
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Frank S. Keery
Chief Executive Officer
Date: 4/26/99 By: /s/ Robert P. Lobban
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Robert P. Lobban
Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this registration statement has been signed by the following persons in the
capacities and on the dates indicated.
/s/ Frank S. Keery
- ------------------------------------- April 26 , 1999
Frank S. Keery, Chairman of the Board ----------------
/s/ Patrick Keery
- ------------------------------------- April 26 , 1999
Patrick Keery, Director ----------------
/s/ Barbara Keery
- ------------------------------------- April 26 , 1999
Barbara Keery, Director ----------------
/s/ Frank S. Keery signing for
Harry H. Birkenruth
- ------------------------------------- April 26 , 1999
Harry H. Birkenruth, Director ----------------
/s/Frank S. Keery signing for
Tony Turner
- ------------------------------------- April 26 , 1999
H.B. Tony Turner, Director ----------------
51