-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ObTxFgGogtkEgWF0knovGY0Taz6iCThpuSDktKPTizpNOM05c+1Kz9NCfTuIsW4s 9DIrNPFD2AeJFe6otLofSw== 0001269678-09-000218.txt : 20091130 0001269678-09-000218.hdr.sgml : 20091130 20091130171805 ACCESSION NUMBER: 0001269678-09-000218 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20090731 FILED AS OF DATE: 20091130 DATE AS OF CHANGE: 20091130 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN TELSTAR INC CENTRAL INDEX KEY: 0000799414 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 841052279 STATE OF INCORPORATION: CO FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-52387 FILM NUMBER: 091212878 BUSINESS ADDRESS: STREET 1: 444 PARK FOREST WAY CITY: WELLINGTON STATE: FL ZIP: 33414 BUSINESS PHONE: 5617984294 MAIL ADDRESS: STREET 1: 444 PARK FOREST WAY CITY: WELLINGTON STATE: FL ZIP: 33414 FORMER COMPANY: FORMER CONFORMED NAME: HERITAGE FUNDING LTD DATE OF NAME CHANGE: 19890106 10-K/A 1 amertel10k073109.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K/A (Amendment No. 1) [x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended - July 31, 2009 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from: Commission file number: 000-52387 AMERICAN TELSTAR, INC. (Exact name of registrant as specified in its charter) Colorado 84-1052279 -------- ---------- (State or other jurisdiction of (I.R.S. Employer Identification Number) incorporation or organization) 444 Park Forest Way, Wellington, FL 33414 ----------------------------------------- (Address of principal executive offices) (561) 798-4294 -------------- (Issuer's telephone number) Securities registered under Section 12(b) of the Act: None Securities registered under Section 12(g) of the Act: Common Stock, $.0001 par value per share (Title of class) Indicate by check mark whether the registrant is a well-known seasoned issuer as defined in Rule 405 of the Securities Act. Yes |_| No |X| Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes |_| No |X| Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(D) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes |X| No |_| Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. |_| Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer |_| Accelerated filer |_| Smaller reporting company |X| Non-accelerated filer |_| Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes |X| No |_| State the aggregate market value of the voting stock held by non- affiliates computed by reference to the price at which the stock was sold, or the average bid and asked prices of such stock, as of a specified date within the past 60 days. (See definition of affiliate in Rule 12b-2 of the Exchange Act): $ -0- State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 650,225 as of July 31, 2009. EXPLANATORY NOTE American Telstar, Inc. (the "Company") is filing this Amendment No. 1 to its Annual Report on Form 10-K for the fiscal year ended July 31, 2009, filed with the Securities and Exchange Commission on October 27, 2009, solely for the purpose of referencing "Registrant" rather than "Small business issuer" and filing amended Section 302 certifications. Each certification, as corrected by this Amendment, was true and correct as of the date of the original filing. This Amendment No. 1 does not reflect events occurring after the filing of the original Form 10-K or modify or update in any way disclosures contained in the original Form 10-K. INDEX PART I Page ---- Item 1. Business 1 Item 1A. Risk Factors 2 Item 1B. Unresolved Staff Comments 4 Item 2. Properties 4 Item 3. Legal Proceedings 4 Item 4. Submission of Matters to a Vote of Security Holders 4 PART II Item 5. Market for Common Equity and Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities 4 Item 6. Selected Financial Data 4 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 5 Item 8. Financial Statements and Supplementary Data 7 PART III Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 16 Item 9A. Controls and Procedures 16 Item 9B. Other Information 17 Item 10. Directors, Officers, and Corporate Governance 17 Item 11. Executive Compensation 18 Item 12. Equity Compensation Plan Information and Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matter 19 Item 13. Certain Relationships and Related Transactions, and Director Independence 19 Item 14. Principal Accountant Fees and Services 19 Item 15. Exhibits and Financial Statement Schedules 20 PART I ITEM 1. BUSINESS American Telstar, Inc. (the "Company") was incorporated on August 5, 1986, under the laws of the State of Colorado. The company was in the music distribution business. In February 1995, the Company was dissolved, by administrative action of the Colorado Secretary of State as a result of non-filing of required documents with the State of Colorado. Effective June 21, 1996, the Company reinstated its charter. In February 1999, the Company was dissolved, by administrative action of the Colorado Secretary of State as a result of non-filing of required documents with the State of Colorado. Since 1991, the Company has not engaged in any operations and has been dormant. As such, the Company may presently be defined as a "shell" company, whose sole purpose, at this time, is to locate and consummate a merger or acquisition with a private entity. Effective September 7, 1999, the Company reinstated its charter. Effective March 25, 2005, the Company commenced activities to become reporting with the SEC with the intention to become a publicly trading company. Its purpose is to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. The Company has been in the developmental stage and has no operations since the renewal of its charter. The Company has not commenced any operational activities. The Board of Directors of the Company has elected to commence implementation of the Company's principal business purpose, described below under "General Business Plan". As such, the Company can be defined as a "shell" company, whose sole purpose at this time is to locate and consummate a merger or acquisition with a private entity. Pursuant to the Articles of Incorporation, the Company is authorized to issue 500,000,000 shares of common stock with $0.0001 par value and 40,000,000 shares of $0.10 par value Preferred Stock. As of July 31, 2009, there are 650,225 shares of common stock outstanding. The proposed business activities described herein classify the Company as a "blank check" company. Many states have enacted statutes, rules and regulations limiting the sale of securities of "blank check" companies in their respective jurisdictions. Management does not intend to undertake any offering of the Company's securities, either debt or equity, until such time as the Company has successfully implemented its business plan herein. GENERAL BUSINESS PLAN At this time, the Company's purpose is to seek, investigate and, if such investigation warrants, acquire an interest in business opportunities presented to it by persons or firms who or which desire to seek the perceived advantages of an Exchange Act registered corporation. The Company will not restrict its search to any specific business, industry, or geographical location and the Company may participate in a business venture of virtually any kind or nature. This discussion of the proposed business is purposefully general and is not meant to be restrictive of the Company's virtually unlimited discretion to search for and enter into potential business opportunities. Management anticipates that it may be able to participate in only one potential business venture because the Company has nominal assets and limited financial resources. See Item 7. "FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA." This lack of diversification should be considered a substantial risk to shareholders of the Company because it will not permit the Company to offset potential losses from one venture against gains from another. The Company may seek a business opportunity with entities which have recently commenced operations, or which wish to utilize the public marketplace in order to raise additional capital in order to expand into new products or markets, to develop a new product or service, or for other corporate purposes. The Company may acquire assets and establish wholly-owned subsidiaries in various businesses or acquire existing businesses as subsidiaries. The Company intends to advertise and promote the Company privately. The Company has not yet prepared any notices or advertisement. 1 ITEM 1A. RISK FACTORS The Company anticipates that the selection of a business opportunity in which to participate will be complex and extremely risky. Due to general economic conditions, rapid technological advances being made in some industries and shortages of available capital, management believes that there are numerous firms seeking the perceived benefits of a publicly registered corporation. Such perceived benefits may include facilitating or improving the terms on which additional equity financing may be sought, providing liquidity for incentive stock options or similar benefits to key employees, providing liquidity (subject to restrictions of applicable statutes), for all shareholders and other factors. Potentially, available business opportunities may occur in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex. The Company has, and will continue to have, little or no capital with which to provide the owners of business opportunities with any significant cash or other assets. However, management believes the Company will be able to offer owners of acquisition candidates the opportunity to acquire a controlling ownership interest in a publicly registered company without incurring the cost and time required to conduct an initial public offering. The owners of the business opportunities will, however, incur significant legal and accounting costs in connection with acquisition of a business opportunity, including the costs of preparing Form 8-K's or 10-K's, agreements and related reports and documents. The Securities Exchange Act of 1934 (the "34 Act"), specifically requires that any merger or acquisition candidate comply with all applicable reporting requirements, which include providing audited financial statements to be included within the numerous filings relevant to complying with the 34 Act. Nevertheless, the officers and directors of the Company have not conducted market research and are not aware of statistical data which would support the perceived benefits of a merger or acquisition transaction for the owners of a business opportunity. The analysis of new business opportunities will be undertaken by, or under the supervision of, the officers and directors of the Company. Management intends to concentrate on identifying preliminary prospective business opportunities, which may be brought to its attention through present associations of the Company's officers and directors. In analyzing prospective business opportunities, management will consider such matters as the available technical, financial and managerial resources; working capital and other financial requirements; history of operations, if any; prospects for the future; nature of present and expected competition; the quality and experience of management services which may be available and the depth of that management; the potential for further research, development, or exploration; specific risk factors not now foreseeable but which then may be anticipated to impact the proposed activities of the Company; the potential for growth or expansion; the potential for profit; the perceived public recognition of acceptance of products, services, or trades; name identification; and other relevant factors. Officers and directors of the Company do expect to meet personally with management and key personnel of the business opportunity as part of their investigation. To the extent possible, the Company intends to utilize written reports and investigation to evaluate the above factors. The Company will not acquire or merge with any company for which audited financial statements cannot be obtained within a reasonable period of time after closing of the proposed transaction. The Officers of the Company have limited experience in managing companies similar to the Company and shall rely upon their own efforts, in accomplishing the business purposes of the Company. The Company may from time to time utilize outside consultants or advisors to effectuate its business purposes described herein. No policies have been adopted regarding use of such consultants or advisors, the criteria to be used in selecting such consultants or advisors, the services to be provided, the term of service, or regarding the total amount of fees that may be paid. However, because of the limited resources of the Company, it is likely that any such fee the Company agrees to pay would be paid in stock and not in cash. The Company will not restrict its search for any specific kind of firms, but may acquire a venture that is in its preliminary or development stage, which is already in operation, or in essentially any stage of its corporate life. It is impossible to predict at this time the status of any business in which the Company may become engaged, in that such business may need to seek additional capital, may desire to have its shares publicly traded, or may seek other perceived advantages which the Company may offer. However, the Company does not intend to obtain funds in one or more private placements to finance the operation of any acquired business opportunity until such time as the Company has successfully consummated such a merger or acquisition. It is anticipated that the Company will incur nominal expenses in the implementation of its business plan described herein. The Company has limited capital with which to pay these anticipated expenses. 2 ACQUISITION OF OPPORTUNITIES In implementing a structure for a particular business acquisition, the Company may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity. It may also acquire stock or assets of an existing business. On the consummation of a transaction, it is probable that the present management and shareholders of the Company will no longer be in control of the Company. In addition, the Company's directors may, as part of the terms of the acquisition transaction, resign and be replaced by new directors without a vote of the Company's shareholders or may sell their stock in the Company. Any and all such sales will only be made in compliance with the securities laws of the United States and any applicable state. It is anticipated that any securities issued in any such reorganization would be issued in reliance upon exemption from registration under applicable federal and state securities laws. In some circumstances, however, as a negotiated element of its transaction, the Company may agree to register all or a part of such securities immediately after the transaction is consummated or at specified times thereafter. If such registration occurs, of which there can be no assurance, it will be undertaken by the surviving entity after the Company has successfully consummated a merger or acquisition and the Company is no longer considered a "shell" company. Until such time as this occurs, the Company does not intend to register any additional securities. The issuance of substantial additional securities and their potential sale into any trading market which may develop in the Company's securities may have a depressive effect on the value of the Company's securities in the future, if such a market develops, of which there is no assurance. While the actual terms of a transaction to which the Company may be a party cannot be predicted, it may be expected that the parties to the business transaction will find it desirable to avoid the creation of a taxable event and thereby structure the acquisition in a so-called "tax-free" reorganization under Sections 368(a) (1) or 351 of the Internal Revenue Code (the "Code"). In order to obtain tax-free treatment under the Code, it may be necessary for the owners of the acquired business to own 80% or more of the voting stock of the surviving entity. In such event, the shareholders of the Company would retain less than 20% of the issued and outstanding shares of the surviving entity, which would result in significant dilution in the equity of such shareholders. As part of the Company's investigation, officers and directors of the Company may personally meet with management and key personnel, may visit and inspect material facilities, obtain analysis of verification of certain information provided, check references of management and key personnel, and take other reasonable investigative measures, to the extent of the Company's limited financial resources and management expertise. The manner in which the Company participates in an opportunity will depend on the nature of the opportunity, the respective needs and desires of the Company and other parties, the management of the opportunity and the relative negotiation strength of the Company and such other management. With respect to any merger or acquisition, negotiations with target company management is expected to focus on the percentage of the Company which the target company shareholders would acquire in exchange for all of their shareholdings in the target company. Depending upon, among other things, the target company's assets and liabilities, the Company's shareholders will in all likelihood hold a substantially lesser percentage ownership interest in the Company following any merger or acquisition. The percentage ownership may be subject to significant reduction in the event the Company acquires a target company with substantial assets. Any merger or acquisition effected by the Company can be expected to have a significant dilutive effect on the percentage of shares held by the Company's then shareholders. The Company will participate in a business opportunity only after the negotiation and execution of appropriate written agreements. Although the terms of such agreements cannot be predicted, generally such agreements will require some specific representations and warranties by all of the parties thereto, will specify certain events of default, will detail the terms of closing and the conditions which must be satisfied by each of the parties prior to and after such closing, will outline the manner of bearing costs, including costs associated with the Company's attorneys and accountants, will set forth remedies on default and will include miscellaneous other terms. As stated hereinabove, the Company will not acquire or merge with any entity which cannot provide independent audited financial statements within a reasonable period of time after closing of the proposed transaction. The Company is subject to all of the reporting requirements included in the 1934 Act. Included in these requirements is the affirmative duty of the Company to file independent audited financial statements as part of its Form 8-K to be filed 3 with the Securities and Exchange Commission upon consummation of a merger or acquisition, as well as the Company's financial statements included in its annual report on Form 10-K . If such audited financial statements are not available at closing, or within time parameters necessary to insure the Company's compliance with the requirements of the 1934 Act, or if the audited financial statements provided do not conform to the representations made by the candidate to be acquired in the closing documents, the closing documents will provide that the proposed transaction will be voidable, at the discretion of the present management of the Company. If such transaction is voided, the agreement will also contain a provision providing for the acquisition entity to reimburse the Company for all costs associated with the proposed transaction. The Company does not intend to provide the Company's security holders with any complete disclosure documents, including financial statements, concerning an acquisition or merger candidate and its business prior to the consummation of any acquisition or merger transaction. COMPETITION The Company will remain an insignificant participant among the firms that engage in the acquisition of business opportunities. There are many established venture capital and financial concerns which have significantly greater financial and personnel resources and technical expertise than the Company. In view of the Company's combined extremely limited financial resources and limited management availability, the Company will continue to be at a significant competitive disadvantage compared to the Company's competitors. ITEM 1B. UNRESOLVED STAFF COMMENTS Not applicable. ITEM 2. PROPERTIES The Company currently maintains a mailing address at 444 Park Forest Way, Wellington, FL 33414, which is the address of its Vice-President. The Company pays no rent for the use of this mailing address. The Company does not believe that it will need to maintain an office at any time in the foreseeable future in order to carry out its plan of operations described herein. ITEM 3. LEGAL PROCEEDINGS. There are no known legal proceedings or outstanding judgments against the Company, nor any pending litigation. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. There were no matters submitted to a vote of the security holders of the Company during the year ended July 31, 2009. PART II ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND REGISTRANT PURCHASES OF EQUITY SECURITIES. (a) Market Information. There is not a market for the Company's securities. (b) Holders. As of July 31, 2009, there are approximately 41 holders of the Company's Common Stock. (c) Dividends. The Company has never paid a cash dividend on its Common Stock and has no present intention to declare or pay cash dividends on the Common Stock in the foreseeable future. The Company intends to retain any earnings, which it may realize in the foreseeable future to finance its operations. Future dividends, if any, will depend on earnings, financing requirements and other factors. ITEM 6. SELECTED FINANCIAL DATA The following selected financial data should be read in conjunction with our financial statements and related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations". The statements o operations data for the years ended July 31, 2009 and 2008 and the balance sheet data at July 31, 2009 and 2008 are derived from our financial statements which are included elsewhere in this Form 10-K. The historical results are not necessarily indicative of results to be expected for future periods. 4 Statements of Operations Data: For the Year Ended July 31, ---------------------------- 2009 2008 ------------ ------------ Revenue $ -- $ -- Costs of goods sold -- -- ------------ ------------ Gross profit (loss) -- -- ------------ ------------ Total operating expenses (30,001) (5,410) ------------ ------------ Net (Loss) $ (30,001) $ (5,410) ============ ============ Basic and diluted loss per share $ (.05) $ (0.01) ============ ============ Shares used in calculation of loss per share: Basic and diluted 650,225 650,225 ============ ============ Balance Sheet Data: July 31, ---------------------------- 2009 2008 ------------ ------------ Cash and cash equivalents $ 5,253 $ 13,321 Working capital $ (21,623) $ 8,378 Total Assets $ 5,253 $ 13,321 Long-term obligations $ -- $ -- Total Shareholders' equity (deficit) $ (21,623) $ 8,378 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The following discussion should be read in conjunction with the Financial Statements and Notes thereto. Our fiscal year ends July 31. This document contains certain forward-looking statements including, among others, anticipated trends in our financial condition and results of operations and our business strategy. (See Part I, Item 1A, "Risk Factors"). These forward-looking statements are based largely on our current expectations and are subject to a number of risks and uncertainties. Actual results could differ materially from these forward-looking statements. Important factors to consider in evaluating such forward-looking statements include (i) changes in external factors or in our internal budgeting process which might impact trends in our results of operations; (ii) unanticipated working capital or other cash requirements; (iii) changes in our business strategy or an inability to execute our strategy due to unanticipated changes in the industries in which we operate; and (iv) various competitive market factors that may prevent us from competing successfully in the marketplace. Results of Operations The Company incorporated in Colorado. The Company was dissolved by the Colorado Secretary of State effective November 27, 1989, and the Registrant has been dormant since then. The Company was reinstated by the Secretary of State of Colorado effective February 1995. Effective June 21, 1996, the Company reinstated its charter. In February 1999, the Company was dissolved, by administrative action of the Colorado Secretary of State as a result of non-filing of required documents with the State of Colorado. Since 1991, the Company has not engaged in any operations and has been dormant. Effective September 7, 1999, the Company reinstated its charter. Effective March 25, 2005, the Company commenced activities to become reporting with the SEC with the intention to become a publicly trading company. Its purpose is to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. The Company has been in the developmental stage and has no operations since the renewal of its charter. The Company has not commenced any operational activities. For the year ended July 31, 2009 we incurred a net loss of ($30,001) or ($.05) per share compared to a net loss of ($5,410) or ($.01) per share for the year ended July 31, 2008. The increase in net loss is primarily attributable to an increase in investment banking fees. 5 The Company believes that while there is some doubt as to the Company's continuance as a going concern, its success is dependent upon its ability to meet its financing requirements and the success of its future operations or completion of a successful business combination. Management believes that actions planned and presently being taken to revise the Company's operating and financial requirements provide the opportunity to the Company to continue as a going concern. Liquidity and Capital Resources On July 31, 2009 we had a negative working capital of ($21,623) and cash of $5,253, compared to working capital of $8,378 and cash of $13,321 at July 31, 2008. On March 25, 2005, the date of commencement of the development stage, the Company had 251,475 common shares issued and outstanding. Effective May 23, 2005, the Company issued 65,750,000, pre-split, (328,750 post-split) shares of common stock to Pride Equities, Inc. (Pride) for $30,000 services to assist the Company in becoming fully reporting with the Securities & Exchange Commission and $30,000 cash. It is the opinion of the Company's management that the fair value of stock issued under this arrangement is $60,000. The measurement date for the issuance of stock was May 23, 2005. Also on May 23, 2005, the Company effected a one for two hundred reverse stock split which resulted in Pride owning 328,750 post split shares of common stock. The Company has no operating history as a "blank check" company and no material assets. We presently do not have any available credit, bank financing or other external sources of liquidity. We will need to obtain additional capital in order to commence operations. We are currently investigating other financial alternatives, including additional equity and/or debt financing. In order to obtain capital, we may need to sell additional shares of our common stock or borrow funds from private lenders. However, there can be no assurance that any additional financing will become available to us, and if available, on terms acceptable to us. 6 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. INDEX TO FINANCIAL STATEMENTS AMERICAN TELSTAR, INC. ---------------------- (A Development Stage Company) FINANCIAL STATEMENTS (UNAUDITED) Financial Statements: Balance Sheets 8 Statements of Operations 9 Statement of Changes in Stockholders' Equity (Deficit) 10 Statements of Cash Flows 11 Notes to Financial Statements 12 to 15 7 AMERICAN TELSTAR, INC. ---------------------- (A Development Stage Company) BALANCE SHEETS (Unaudited) July 31, July 31, 2009 2008 ---------- ---------- ASSETS Current Assets: Cash $ 5,253 $ 13,321 ---------- ---------- Total Current Assets 5,253 13,321 ---------- ---------- TOTAL ASSETS $ 5,253 $ 13,321 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current Liabilities: Accounts payable, investment banking services $ 26,250 $ -- Accounts payable, related party 626 4,943 ---------- ---------- Total Current Liabilities 26,876 4,943 ---------- ---------- TOTAL LIABILITIES 26,876 4,943 ---------- ---------- Commitments and contingencies (Notes 1, 2 and 4) Stockholders' Equity (Deficit): Preferred stock, $0.10 par value 40,000,000 shares authorized, none issued and outstanding -- -- Common stock,$0.0001 par value 500,000,000 shares authorized, 650,225 issued and outstanding 65 65 Additional paid-in capital 229,435 229,435 Accumulated (deficit) (163,000) (163,000) Accumulated (deficit) during the development stage (88,123) (58,122) ---------- ---------- TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (21,623) 8,378 ---------- ---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 5,253 $ 13,321 ========== ========== The accompanying notes are an integral part of the financial statements. 8 AMERICAN TELSTAR, INC. ---------------------- (A Development Stage Company) STATEMENTS OF OPERATIONS (Unaudited) For the period from March 25, 2005 (date of development stage) For the Year Ended through July 31, July 31, 2009 2008 2009 ---------- ---------- ----------- Revenue $ -- $ -- $ -- ---------- ---------- ----------- Expenses: Stock issued for reorganization services -- -- 6,500 Consulting fees, related party -- -- 30,000 Investment banking services 26,250 -- 26,250 Professional fees 3,694 4,900 23,321 Other 57 510 2,052 ---------- ---------- ----------- 30,001 5,410 88,123 ---------- ---------- ----------- Net (Loss) $ (30,001) $ (5,410) $ (88,123) ========== ========== =========== Per Share $ (.05) $ (.01) $ (.14) ========== ========== =========== Weighted Average Shares Outstanding 650,225 650,225 635,419 ========== ========== =========== The accompanying notes are an integral part of the financial statements. 9
AMERICAN TELSTAR, INC. ---------------------- (A Development Stage Company) STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY For the Period from August 1, 2004 through July 31, 2009 (Unaudited) Accumulated (Deficit) Additional during the Preferred Stock Common Stock Paid in Accumulated Development No./Shares Amount No./Shares Amount Capital (Deficit) Stage Total ---------- ------ ---------- ------ ---------- ----------- ----------- --------- Balance at August 1, 2004 -- $ -- 251,475 $ 25 $ 162,975 $ (163,000) $ -- $ -- Issuance of stock for services at $.0928 May 23, 2005 -- -- 70,000 7 6,493 -- -- 6,500 Issuance of stock for $30,000 services and $30,000 cash at $.1825, May 23, 2005 -- -- 328,750 33 59,967 -- -- 60,000 Net loss-year ended July 31, 2005 -- -- -- -- -- -- (9,019) (9,019) ---------- ------ ---------- ------ ---------- ----------- ----------- --------- Balance at July 31, 2005 -- -- 650,225 65 229,435 (163,000) (9,019) 57,481 Net loss-year ended July 31, 2006 -- -- -- -- -- -- (2,522) (2,522) ---------- ------ ---------- ------ ---------- ----------- ----------- --------- Balance at July 31, 2006 -- -- 650,225 65 229,435 (163,000) (11,541) 54,959 Net loss-year ended July 31, 2007 -- -- -- -- -- -- (41,171) (41,171) ---------- ------ ---------- ------ ---------- ----------- ----------- --------- Balance at July 31, 2007 -- -- 650,225 65 229,435 (163,000) (52,712) 13,788 Net loss-year ended July 31, 2008 -- -- -- -- -- -- (5,410) (5,410) ---------- ------ ---------- ------ ---------- ----------- ----------- --------- Balances at July 31, 2008 -- -- 650,225 65 229,435 (163,000) (58,122) 8,378 Net loss-year ended July 31, 2009 -- -- -- -- -- -- (30,001) (30,001) ---------- ------ ---------- ------ ---------- ----------- ----------- --------- Balance at July 31, 2009 -- $ -- 650,225 $ 65 $ 229,435 $ (163,000) $ (88,123) $ (21,623) ========== ====== ========== ====== ========== =========== =========== =========
The accompanying notes are an integral part of the financial statements. 10
AMERICAN TELSTAR, INC. ---------------------- (A Development Stage Company) STATEMENTS OF CASH FLOWS (Unaudited) For the period from March 25, 2005 (date of development stage) For the Year Ended through December 31, July 31, 2009 2008 2009 ---------- ---------- ----------- Cash Flows from Operating Activities: Net (Loss) $ (30,001) $ (5,410) $ (88,123) Adjustment to reconcile net (loss) to net cash (used in) operating activities: Stock issued for reorganization services -- -- 6,500 Decrease in prepaid expense -- -- 30,000 Increase (decrease) in accounts payable and accrued expenses 21,933 (6,318) 26,876 ---------- ---------- ----------- Net Cash (Used in) Operating Activities (8,068) (11,728) (24,747) ---------- ---------- ----------- Cash Flows from Investing Activities -- -- -- ---------- ---------- ----------- Cash Flows from Financing Activities: Common stock issued for cash -- -- 30,000 ---------- ---------- ----------- Net Cash Provided by Financing Activities -- -- 30,000 Increase (decrease) in Cash (8,068) (11,728) 5,253 Cash, Beginning of Period 13,321 25,049 -- ---------- ---------- ----------- Cash, End of Period $ 5,253 $ 13,321 $ 5,253 ========== ========== =========== Interest Paid $ -- $ -- $ -- ========== ========== =========== Income Taxes Paid $ -- $ -- $ -- ========== ========== ===========
The accompanying notes are an integral part of the financial statements. 11 AMERICAN TELSTAR, INC. ---------------------- (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS July 31, 2009 (Unaudited) Note 1 - Organization and Summary of Significant Accounting Policies This summary of significant accounting policies of American Telstar, Inc. (Company) is presented to assist in understanding the Company's financial statements. The financial statements and notes are representations of the Company's management who is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles in the United States of America and have been consistently applied in the preparation of the financial statements. (a) Organization and Description of Business The Company (formerly Heritage Funding, Ltd.) was originally incorporated as a Colorado corporation on August 5, 1986. Heritage Funding, Ltd. successfully completed a public offering of securities during the year ended July 31, 1988. On November 28, 1988, the Company issued 185,000 (post reverse-split) shares of its $.0001 par value common stock in exchange for 100% ownership of American Telstar, Inc. American Telstar, Inc. was established as a California corporation in 1986. The Company was engaged in the music video business as well as a movie production business. American Telstar in 1988 became engaged in acquiring music through lease agreements for various record labels. Since 1991, the Company has not engaged in any operations and has been dormant. Heritage Funding, Ltd. changed its name to American Telstar, Inc. effective December 9, 1988. The business combination was accounted for as a reverse purchase since the controlling shareholders of the acquired company control the acquiring company after the transaction. The stockholders' (deficit) section of the financial statements has been retroactively adjusted to give effect to the reorganization as of the date the original shares were issued by American Telstar, Inc., the California corporation. The net monetary assets of Heritage Funding, Ltd. at the time of the transaction have been treated as consideration for the new shares at that time. Effective March 25, 2005, the Company commenced activities to become reporting with the SEC with the intention to become a publicly trading company. (b) Development Stage Activities Based upon the Company's business plan, it is a development stage enterprise since planned principal operations have not yet commenced. Accordingly, the Company presents its financial statements in conformity with the accounting principles generally accepted in the United States of America that apply in establishing operating enterprises. As a development stage enterprise, the Company discloses the deficit accumulated during the development stage and the cumulative statements of operations and cash flows from commencement of development stage to the current balance sheet date. The development stage began March 25, 2005 when the Company commenced activities to become reporting with the SEC with the intention to become a publicly trading company. (c) Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. 12 (d) Basic and Diluted Loss Per Share In accordance with SFAS No. 128 - "Earnings Per Share", the basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. At July 31, 2009, the Company had no stock equivalents that were anti-dilutive and excluded in the earnings per share computation. (e) Basis of Presentation - Going Concern The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplates continuation of the Company as a going concern. However, the Company has negative working capital and no active business operations, which raises substantial doubt about its ability to continue as a going concern. In view of these matters, realization of certain of the assets in the accompanying balance sheet is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to meet its financial requirements, raise additional capital, and the success of its future operations. Management intends to resume the filing of Securities and Exchange Commission (SEC) reporting documentation and then to seek a business combination. Management believes that this plan provides an opportunity for the Company to continue as a going concern. (f) Estimated Fair Value of Financial Instruments The carrying value of the Company's financial instruments, consisting of cash, cash equivalents, accounts payable and accrued liabilities approximate their fair value due to the short-term maturity of such instruments. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial statements. (g) Concentrations Financial instruments that potentially subject the company to concentrations of credit risk consist principally of cash and cash equivalents. At July 31, 2009, the Company had no amounts of cash or cash equivalents in financial institutions in excess of amounts insured by agencies of the U.S. Government. (h) Cash and Cash Equivalents The Company considers all highly liquid debt instruments with an original maturity of three months or less to be cash equivalents. (i) Recent Accounting Pronouncements There were various accounting standards and interpretations issued during 2009 and 2008, none of which are expected to have a material impact on the Company's consolidated financial position, operations or cash flows. (j) Risks and Uncertainties The Company is subject to substantial business risks and uncertainties inherent in starting a new business. There is no assurance that the Company will be able to complete a business combination. (k) Revenue Recognition The Company has had no revenue during its development stage. 13 (l) Income taxes The Company recognizes deferred tax assets and liabilities for temporary differences between the tax bases of assets and liabilities and the amounts at which they are carried in the financial statements, the effect of net operating losses, based upon the enacted tax rates in effect for the year in which the differences are expected to reverse. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized. (m) Unaudited Financial Statements The balance sheets as of July 31, 2009 and 2008, and the statements of operations, changes in stockholders' equity and cash flows for the two years ended July 31, 2009 and 2008, have been prepared by the Company without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Since the Company is an inactive company as defined by Regulation S-X, 210, 3-11, audited financial statements are not required to be presented. In the opinion of management, all adjustments necessary to present fairly the financial position, results of operations and changes in financial position at July 31, 2009 and 2008 and for all periods presented, have been made. (n) Other The Company has selected July 31 as its fiscal year end. The Company has paid no dividends. The Company consists of one reportable business segment. The Company has not entered into any leases. Note 2 - Income Taxes Deferred income taxes arise from temporary timing differences in the recognition of income and expenses for financial reporting and tax purposes. The Company's deferred tax assets consist entirely of the benefit from net operating loss (NOL) carryforwards. The net operating loss carry forwards expire in various years through 2029. The Company's deferred tax assets are offset by a valuation allowance due to the uncertainty of the realization of the net operating loss carryforwards. Net operating loss carryforwards may be further limited by a change in company ownership and other provisions of the tax laws. The Company's deferred tax assets, valuation allowance, and change in valuation allowance are as follows: Estimated Estimated Tax Change in NOL Carry- NOL Benefit Valuation Valuation Net Tax Period Ending forward Expires from NOL Allowance Allowance Benefit - ------------- ------- ------- -------- --------- --------- ------- July 31, 2009 88,123 Various 16,303 (16,303) (5,550) -- July 31, 2008 58,122 Various 10,753 (10,753) (1,001) -- Income taxes at the statutory rate are reconciled to the Company's actual income taxes as follows: Income tax benefit at statutory rate resulting from net operating loss carryforward (15.0%) State tax benefit, net of federal benefit (3.5%) --------------- Deferred income tax valuation allowance 18.5% --------------- Actual tax rate 0% =============== 14 Note 3 - Common and Preferred Stock The Company's Articles of Incorporation authorize the issuance of up to 500,000,000 shares of $0.0001 par value common stock and up to 40,000,000 shares of $0.10 par value preferred stock. As of July 31, 2009, there were 650,225 shares of common stock issued and outstanding and there were no preferred shares issued or outstanding. The terms and preferences of the authorized preferred stock may be determined at the discretion of the Company's board of directors. On May 23, 2005, the Company issued 70,000 shares of its common stock to its President for reorganization services valued by the Board of Directors at $6,500, resulting in a price per share of $.0928. Also on May 23, 2005, the Company issued 328,750 shares of its common stock to Pride Equities, Inc. (Pride), representing approximately 51% of its common stock outstanding, in exchange for future services valued at $30,000 and a cash contribution of $30,000, resulting in a price per share of $.1825. The services provided by Pride consisted principally of services related to the Company's reorganization. Determination of this price per share by the Board of Directors was based on the fact that the shares issued to Pride were majority control shares. This transaction resulted in a change in control of the Company. Also on May 23, 2005, the Company effected a one for 200 reverse stock split. All references in the accompanying financial statements to the number of common shares and per share amounts have been retroactively restated to reflect the reverse stock split. During the three months ended April 30, 2009, the Company issued 492,500 shares of common stock to the two officers and directors of the Company, and in May 2009 canceled these shares because of possible violation of other common shareholders' rights and dilution of their share position. Note 4 - Commitments Effective February 16, 2009, the Company entered into an agreement with an entity, whereby the entity would provide investment banking services in exchange for a retainer of $25,000 due in February 2009. The $25,000 was not paid as of July 31, 2009, and the Company is incurring a 1% monthly fee until paid in full. Note 5 - Related Party Transactions The Company uses the offices of its Chief Financial Officer for its minimal office facility needs for no consideration. No provision for these costs has been provided since it has been determined they are immaterial. 15 PART III ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUTNING AND FINANCIAL DISCLOSURE. None. ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures - ------------------------------------------------ The Company maintains disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) or 15d-15(e)) designed to ensure that information required to be disclosed in reports filed or submitted under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in its reports that it files or submits under the Exchange Act is accumulated and communicated to the Company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. The Company's management, with the participation of its chief executive officer and its chief financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) or 15d-15(e)) as of July 31, 2009. Based on that evaluation, the Company's chief executive officer concluded that, as of that date, the Company's disclosure controls and procedures, were not effective at a reasonable assurance level, due to the identification of a material weakness, as discussed further below under Management's Report on Internal Control over Financial Reporting. Management's Report on Internal Control over Financial Reporting - ---------------------------------------------------------------- Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives. Furthermore, smaller reporting companies face additional limitations. Smaller reporting companies employ fewer individuals and find it difficult to properly segregate duties. Additionally, smaller reporting companies tend to utilize general accounting software packages that lack a rigorous set of software controls. Our management, with the participation of the President, evaluated the effectiveness of the Company's internal control over financial reporting as of July 31, 2009. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control -- Integrated Framework. Based on that evaluation, our management concluded that, as of July 31, 2009, our internal control over financial reporting was not effective due to material weaknesses in the system of internal control. Specifically, management identified the following control deficiencies. (1) The Company has not properly segregated duties as one or two individuals initiate, authorize, and complete all transactions. The Company has not implemented measures that would prevent the individuals from overriding the internal control system. The Company does not believe that this control deficiency has resulted in deficient financial reporting because the Chief Financial Officer is aware of his responsibilities under the SEC's reporting requirements and personally certifies the financial reports. (2) The Company has installed accounting software that does not prevent erroneous or unauthorized changes to previous reporting periods and does not provide an adequate audit trail of entries made in the accounting software. Accordingly, while the Company has identified certain material weaknesses in its system of internal control over financial reporting, it believes that it has taken reasonable steps to ascertain that the financial information contained in this report is in accordance with generally accepted accounting principles. Management has determined that current resources would be appropriately applied elsewhere and when resources permit, they will alleviate material weaknesses through various steps. 16 This Annual Report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management's report in this Annual Report. Changes in Internal Control over Financial Reporting - ---------------------------------------------------- There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal year that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION None ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE Directors and Executive Officers The following table sets forth certain information concerning each of the Company's directors and executive officers: NAME AGE POSITION Charles Calello 71 President, Chief Executive Officer and Director Peter Porath 78 Vice-President, Chief Financial Officer, Secretary, Treasurer and Director CHARLES CALELLO. Charles Calello is President and a Director of American Telstar since 1986. Mr. Calello was President and Chairman of the Board of Cardiff Financial until November 15, 2005. Mr. Calello is currently on the Board of Directors of the Florida Sunshine Pops Orchestra, Inc. since its inception in 1999. Mr Calello is currently on the Board of Directors of The Gold Cost Opera since 2004. Mr. Calello is a music arranger and producer and has had over 100 songs on the Billboard magazine top 100 with 38 of them being top ten. Mr. Calello started his musical career in 1962 with the 4 Seasons as their music arranger. For the years 1965 and 1966 Mr. Calello was one of the 4 Seasons touring the United States. From 1966 thru 1968, Mr. Calello worked as a "Record Producer" for the CBS company, Colombia Records. Mr. Calello has been President of Charles Calello Productions, Inc., a music production company for the past 40 years. The company is currently located in Boca Raton, Florida and provides musical arrangements and productions for Symphonic Pops Orchestras, singers and musicians throughout the United States. Mr. Calello was educated at the Manhattan School of Music in New York City, New York. PETER PORATH. Peter Porath has been Vice-President and a director of the Company since March 2005. Since January 2003, Mr. Porath has been President and a Director of Federal Mortgage Corporation of Puerto Rico (Federal), which was an inactive company until March 31, 2005. Effective March 31, 2005, Federal acquired 100% ownership of Pride Lending, Inc. from a related party. Pride Lending, Inc. principally invests in mortgage loans. He has also, since June 2003, been a President and Director of National Superstars, Inc, an inactive pubic company until May 31, 2005. Effective May 31, 2005, National Superstars, Inc. completed a business combination with MSO Holdings, Inc. resulting in a change in control of National Superstars, Inc. Since January 2005, he has been Vice-President and a director of Springfield Financial, Inc., an inactive company. Mr. Porath was a director of Sun Vacation Properties Corporation (formerly Commonwealth Equities, Inc.), a public company, and was President from November 2000 until February 2001. Mr. Porath was a director and president of Vacation Ownership Marketing, Inc., (a public company) from May 2000 until August 2001. Mr. Porath was a director for Plants For Tomorrow, an environmental mitigation concern through the years from 1989-1991. From 1990 through 2001, Mr. Porath, semi-retired operated a retail magic supply store in Fort Lauderdale, Florida, Merlin's Festival of Magic. From 1978 to 1979, Mr. Porath was executive vice-president and director of International Resort Properties, Inc., a timesharing company in Hillsboro Beach, Florida where he was responsible for the development of a 20-unit project. Prior to 1978, Mr. Porath was Vice President of Investment Corporation of Florida, a public company on the American Stock Exchange, and developer of Wellington and Palm Beach Polo, now a city of 40,000 people. Prior to this, Mr. Porath was President of San Andros, Inc., doing real estate workouts for the Bank of Virginia; Vice-President of Magnuson Corp., a real estate developer; Supervisor of Customer Service for General Development Corp., a New York Stock Exchange Company; and Assistant to the Vice-President of Moody's Investors Service, Chicago, now a New York Stock Exchange Company. Mr. 17 Porath attended Syracuse University in the U.S. Air Force Security Service and holds a Bachelor of the Arts Degree in English from Ripon College and a Juris Doctor from De Paul University in Chicago. Significant Employees - --------------------- The Company has no regular employees. Charles Calello and Peter Porath each devote approximately 5% of their time to the Company's business. Involvement in Certain Legal Proceedings - ---------------------------------------- None. Section 16(a) Beneficial Ownership Reporting Compliance - ------------------------------------------------------- Section 16(a) of the Securities and Exchange Act of 1934 requires any person who is our director or executive officer or who beneficially holds more than ten percent (10%) of any class of our securities which have been registered with the Securities and Exchange Commission. These persons are also required under the regulations of the Securities and Exchange Commission to furnish us with copies of all Section 16(a) reports they file. Code of Ethics - -------------- We have not prepared a written code of ethics and employment standards for our company. Corporate Governance; Audit Committee Financial Expert - ------------------------------------------------------ We currently do not have an audit committee financial expert or an independent audit committee expert due to the fact that our Board of Directors currently does not have an independent audit committee. ITEM 11. EXECUTIVE COMPENSATION. Presently, none of the Company's current officers or directors received any compensation for their respective services rendered unto the Company. They all have agreed to act without compensation until authorized by the Board of Directors, which is not expected to occur until the Company has generated revenues from operations after consummation of a merger or acquisition. The Company currently has no funds available to pay officers or directors. Further, none of the officers or directors are accruing any compensation pursuant to any agreement with the Company. It is possible that, after the Company successfully consummates a merger or acquisition with an unaffiliated entity, that entity may desire to employ or retain one or a number of members of the Company's management for the purposes of providing services to the surviving entity, or otherwise provide other compensation to such persons. However, the Company has adopted a policy whereby the offer of any post-transaction remuneration to members of management will not be a consideration in the Company's decision to undertake any proposed transaction. Each member of management has agreed to disclose to the Company's Board of Directors any discussions concerning possible compensation to be paid to them by any entity that proposes to undertake a transaction with the Company and further, to abstain from voting on such transaction. Therefore, as a practical matter, if each member of the Company's Board of Directors is offered compensation in any form from any prospective merger or acquisition candidate, the proposed transaction will not be approved by the Company's Board of Directors as a result of the inability of the Board to affirmatively approve such a transaction. It is possible that persons associated with management may refer a prospective merger or acquisition candidate to the Company. In the event the Company consummates a transaction with any entity referred by associates of management, it is possible that such an associate will be compensated for their referral in the form of a finder's fee. It is anticipated that this fee will be either in the form of restricted common stock issued by the Company as part of the terms of the proposed transaction, or will be in the form of cash consideration. However, if such compensation is in the form of cash, such payment will be tendered by the acquisition or merger candidate, because the Company has insufficient cash available. The amount of such finder's fee cannot be determined as of the date of this registration statement, but is expected to be comparable to consideration normally paid in like transactions. No member of management of the Company will receive any finder's fee, either directly or indirectly, as a result of their respective efforts to implement the Company's business plan outlined herein. 18 No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have been adopted by the Company for the benefit of its employees. ITEM 12. EQUITY COMPENSATION PLAN INFORMATION AND SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. As of July 31, 2009, there were no equity compensation plans in effect. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The following table sets forth certain information as of July 31, 2009 regarding the beneficial ownership of the Company's Common Stock by (i) each stockholder known by the Company to be the beneficial owner of more than 5% of the Company's Common Stock, (ii) by each Director and executive officer of the Company and (iii) by all executive officer and Directors of the Company as a group. Unless otherwise indicated, the stockholders listed in the table have sole voting and investment power with respect to Common Stock beneficially owned. Common Stock Percentage of Name of Beneficial Owner Beneficially Owned Common Stock - ------------------------------------- ------------------ ------------- Pride Equities, Inc. 328,750 50.56% Charles Calello 165,000 25.38% Ranji Bedi 95,000 14.61% All Officers and Directors as a Group 165,000 25.38% ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE Effective May 23, 2005, Pride Equities, Inc. agreed to provide services valued at $30,000 and to fund the Company with $30,000 in exchange for 328,750 (post reverse-split) shares of the Company's common stock. Securities issued by blank check companies cannot be resold under Rule 144, but must be registered under the Securities Act of 1933. Pride Equities, Inc. is a related party since Mr. Schumacher was formerly a director and officer of the Company, and is the President and Director of Pride, Inc., the parent company of Pride Equities, Inc., and an officer and director of Pride Equities, Inc. The Board of Directors has passed a resolution which contains a policy that the Company will not seek an acquisition or merger with any entity in which any of the Company's Officers, Directors, principal shareholders or their affiliates or associates serve as officer or director or hold any ownership interest. Management is not aware of any circumstances under which this policy, through their own initiative may be changed. The proposed business activities described herein classify the Company as a "blank check" company. Many states have enacted statutes, rules and regulations limiting the sale of securities of "blank check" companies in their respective jurisdictions. Management does not intend at this time to undertake any efforts to cause a market to develop in the Company's securities until such time as the Company has successfully implemented its business plan described herein. Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The Company has not used an independent auditor in the two most recent fiscal years. Since the Company is an inactive company as defined by Regulation S-X, 210, 3-11, audited financial statements are not required to be presented. 19 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 31.1 Section 302 Certification -- Chief Executive Officer 31.2 Section 302 Certification-- Chief Financial Officer 32.1 Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Chief Executive Officer. 32.2 Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Chief Financial Officer. * These documents are rendered as previously filed and incorporated by reference to the Company's previous filings with the Securities and Exchange Commission. 20 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. American Telstar, Inc. Date: November 30, 2009 By: /s/ Charles Calello - ----------------------------------------------- Charles Calello President, Chief Executive Officer and Director By: /s/ Peter Porath - ----------------------------------------------- Peter Porath Vice-President, Secretary, Treasurer, Chief Financial Officer and Director 21
EX-31.1 2 amertel10k073109ex311.txt SECTION 302 CERTIFICATION OF CHIEF EXECUTIVE OFFICER EXHIBIT 31.1 RULE 13a-14(a) CERTIFICATION OF CHARLES CALELLO I, Charles Calello, certify that: 1. I have reviewed this report on Form 10-K of American Telstar, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; 4. The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, is made known to us by others, particularly during the period in which this report is being prepared; b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) evaluated the effectiveness of the Registrant's disclosure controls and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and 5. The Registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to our auditor and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions); (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting. Date: November 30, 2009 By: /s/ Charles Calello ------------------------------------- Charles Calello -- President, Chief Executive Officer 22 EX-31.2 3 amertel10k073109ex312.txt SECTION 302 CERTIFICATION OF CHIEF FINANCIAL OFFICER EXHIBIT 31.2 RULE 13a-14(a) CERTIFICATION OF PETER PORATH I, Peter Porath, certify that: 1. I have reviewed this report on Form 10-K of American Telstar, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; 4. The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, is made known to us by others, particularly during the period in which this report is being prepared; b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) evaluated the effectiveness of the Registrant's disclosure controls and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and 5. The Registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to our auditor and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions); (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting. Date: November 30, 2009 By: /s/ Peter Porath ------------------------------------- Peter Porath - Vice-President, Secretary, Treasurer & Chief Financial Officer 23 EX-32.1 4 amertel10k073109ex321.txt SECTION 906 CERTIFICATION OF CHIEF EXECUTIVE OFFICER EXHIBIT 32.1 CERTIFICATION PURSUANT TO 18 U.S.C. 1350 In connection with the Report of American Telstar, Inc. (the "Company") on Form 10-K for the year ended July 31, 2009, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Charles Calello, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; And (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. Date: November 30, 2009 By: /s/ Charles Calello ------------------------------------- Charles Calello- President and Chief Executive Officer 24 EX-32.2 5 amertel10k073109ex322.txt SECTION 906 CERTIFICATION OF CHIEF FINANCIAL OFFICER EXHIBIT 32.2 CERTIFICATION PURSUANT TO 18 U.S.C. 1350 In connection with the Report of American Telstar, Inc. (the "Company") on Form 10-K for the year ended July 31, 2009, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Peter Porath, Vice President, Secretary, Treasurer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; And (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. Date: November 30, 2009 By: /s/ Peter Porath ------------------------------------- Peter Porath - Vice-President, Secretary, Treasurer & Chief Financial Officer 25
-----END PRIVACY-ENHANCED MESSAGE-----