<PAGE> 1

Date Filed:  April 7, 1997                            SEC File No.


SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

AMERICAN TIRE CORPORATION
----------------------------------------------
(Name of small business issuer in its Charter)

             Nevada                                           87-0535207
------------------------------                          ----------------------
(State or jurisdiction of                               (I.R.S. Employer 
incorporation or organization)                          Identification Number)

446 West Lake Avenue, Ravenna, Ohio  44266 (216) 296-8778
-------------------------------------------------------------
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)


3011
--------------------------------------------------------
(Primary Standard Industrial Classification Code Number)

Copies to:                                Registered Agent:
Elliott N. Taylor, Esq.                   Laughlin Associates, Inc.
Taylor and Associates, Inc.               2533 North Carson Street
3090 East 3300 South, Suite 400           Carson City, Nevada  89706
Salt Lake City, Utah  84109               (800) 648-0966
Phone (801) 463-6080                      ------------------------------------
Fax (801) 463-6085                        (Name, address, including zip code,
                                          and telephone number, including area
                                          code, of agent for service)

     Approximate date of proposed sale to the public:  As soon as practicable 
after the effective date of this Registration Statement.

<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE

Title of Each                         Proposed Maximum   Proposed Maximum     
Amount of
Class of Securities   Amount to       Offering Price     Aggregate Offering   
Registration
to be Registered      be Registered   per Share (1)      Price (1)            
Fee
-------------------   -------------   ----------------   ------------------   
------------
<S>                 <C>            <C>                <C>                  <C>
Shares of Common
Stock, $0.001 par
value                 155,000 Shares  $6.375             $988,125.00          
$299.48

</TABLE>

(1)  Estimated solely for purposes of calculating the registration fee 
pursuant to Rule 457.  This amount is based upon the average of the high and 
low prices ($6.375) of the common stock of the Registrant as reported on the 
NASD's OTC Bulletin board on April 4, 1997.


<PAGE> 2   

If any of the securities being registered on this form are to be offered on a 
delayed or continuous basis pursuant to Rule 415 under the Securities Act of 
1933, check the following box.  [X]

The Registrant hereby amends this registration statement on such dates as may 
be necessary to delay its effective date until the registrant shall file a 
further amendment which specifically states that this registration statement 
shall thereafter become effective in accordance with section 8(a) of the 
Securities Act of 1933 or until the registration statement shall become 
effective on such date as the Commission, acting pursuant to said section 
8(a), may determine.

Exhibit Index appears on consecutively numbered page 67.
PAGE
<PAGE> 3
AMERICAN TIRE CORPORATION
Cross Reference Sheet Pursuant to Rule 404(a)

Cross reference between items of Part I of Form S-1 and the Prospectus filed 
by American Tire Corporation, as part of the Registration Statement.

REGISTRATION STATEMENT ITEM NUMBER                    PROSPECTUS
AND HEADING                                           HEADING
----------------------------------                    ----------

1.     Forepart of the Registration Statement and
     Outside Front Cover Page of Prospectus......... Front Cover

2.     Inside Front and Outside Back Cover Page
     of Prospectus.................................. Inside Front Cover and
                                                      Outside Back Cover

3.     Summary Information; Risk Factors; and
      Ration of Earnings to Fixed Charges............ INTRODUCTION; RISK
                                                      FACTORS; Not Applicable
                                                     
4.     Use of Proceeds................................ Not Applicable

5.     Determination of Offering Price................ Not Applicable
                                                      
6.     Dilution....................................... Not Applicable
                                                      
7.     Selling Security Holders....................... SELLING 
SHAREHOLDERS    

8.     Plan of Distribution........................... PLAN OF DISTRIBUTION

9.     Legal Proceedings.............................. LITIGATION

10.     Directors and Executive Officers............... MANAGEMENT
     
11.     Security Ownership of Certain Beneficial
     Owners and Management.......................... PRINCIPAL SHAREHOLDERS

12.     Description of the Securities to
     to be Registered............................... DESCRIPTION OF
                                                      CAPITAL STOCK

13.     Interest of Named Experts and Counsel.......... EXPERTS and 
LEGAL                                                               MATTERS

14.     Statement as to Indemnification................ UNDERTAKINGS

15.     Organization Within Five Years................. BUSINESS

16.     Description of Business........................ BUSINESS

17.     Description of Property........................ PROPERTY

     (A)  Description of Property-Issuers Engaged
           In Significant Mining Operations.......... Not Applicable
     (B)  Supplementary Financial Information
           About Oil and Gas Producing Activities.... Not Applicable
PAGE
<PAGE> 4

REGISTRATION STATEMENT ITEM NUMBER                    PROSPECTUS
AND HEADING                                           HEADING
----------------------------------                    ----------

18.     Interest of Management and Others
     in Certain Transactions........................ CERTAIN TRANSACTIONS

19.     Certain Market Information..................... Not 
Applicable                                                                      
         
20.     Executive Compensation......................... EXECUTIVE 
COMPENSATION                                                                   

21.     Financial Statements........................... FINANCIAL STATEMENTS

PAGE
<PAGE> 5

PROSPECTUS


SUBJECT TO COMPLETION -- DATED APRIL 7, 1997


155,000 Shares

AMERICAN TIRE CORPORATION

Common Stock


     All of the shares of Common Stock offered hereby are being sold by 
certain shareholders of the Company (the"Selling Shareholders").  See SELLING 
SHAREHOLDERS.  The Company will not receive any proceeds from the sale of the 
shares offered hereby.

     The Common Stock of the Company is traded in the over-the-counter market 
and is quoted on the National Association of Securities Dealers, Inc. OTC 
Bulletin Board (the "OTC Bulletin Board") under the symbol "ATYR".  On April 
4, 1997, the last reported sales price of the Common Stock was $6.50 per 
share.
 
     THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES 
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION; NOR HAS THE 
COMMISSION PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING; NOR HAS ANY 
STATE SECURITIES DIVISION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS 
PROSPECTUS.  ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.


==============================================================================
                          Price to      Underwriting       Proceeds to Selling
                          Public        Discounts (1)      Shareholders (1)
------------------------------------------------------------------------------
Per Share...............  $             $0.00              $
Total...................  $             $0.00              $
==============================================================================

(1)  Any commissions or discounts paid in connection with the sale of the 
Common Stock will be paid by the Selling Shareholders and will be determined 
through negotiations between them and the broker-dealer through or to which 
the shares are sold and may vary depending on the broker-dealer's fee 
schedule, the size of the transaction, and other factors.  The Selling 
Shareholders and any broker, dealer, or agent that participates with the 
Selling Shareholders in the sale of the Common Stock may be deemed 
"underwriters" within the meaning of the Securities Act of 1933, as amended 
(the "Securities Act") and any commissions or discounts received by them and 
any profit on the resale of the Common Stock purchased by them may be deemed 
to be underwriting commissions under the Securities Act.  See PLAN OF 
DISTRIBUTION.



The date of this Prospectus is __________, 1997
PAGE
<PAGE> 6

     No person has been authorized in connection with any offering made hereby 
to give any information or to make any representation not contained in this 
Prospectus, and, if given or made, such information or representation must not 
be relied upon as having been authorized by the Company.  This Prospectus does 
not constitute an offer to sell or a solicitation of an offer to buy any 
security other than the Common Stock offered by this Prospectus, nor does it 
constitute an offer to sell or a solicitation of any offer to buy any Common 
Stock offered hereby to any person in any jurisdiction where it is unlawful to 
make such an offer or solicitation to such person.  Neither the delivery of 
this Prospectus nor any sale hereunder shall under any circumstances create 
any implication that information contained herein is correct as of any time 
subsequent to the date hereof.

     Changes in the Offering which occur after the date hereof, if any, will 
necessitate the filing with the Securities and Exchange Commission (the 
"Commission") of an amendment to the registration statement of which this 
Prospectus forms a part (the "Registration Statement") and review and 
declaration of effectiveness by the Commission of such amendment.  There can 
be no assurance that any such amendment will become effective.  Should the 
Company file a post-effective amendment and such amendment is not declared 
effective by the Commission, Selling Shareholders will be precluded from 
making offers and from selling the Shares of Common Stock.
PAGE
<PAGE> 7

PROSPECTUS SUMMARY


     The following summary is qualified in its entirety by the more detailed 
information and the financial statements and notes thereto appearing elsewhere 
in this Prospectus.

The Company

     American Tire Corporation, a Nevada corporation (the "Company"), was 
organized on January 30, 1995, to take advantage of existing proprietary and 
non-proprietary technology available for the manufacturing of specialty tires. 
The Company has had limited operations since its organization and is a 
"development stage" company.  The Company is engaged in the manufacturing, 
marketing, distribution, licensing, and sales of airless "specialty" tires 
utilizing a "liquid phase" technology.  "Liquid Phase" technology refers to a 
production process where the materials that are utilized in the process are 
initially in a liquid state and, through a reaction (primarily chemical), the 
liquid materials are transformed into a solid state. See BUSINESS.

     The Company has spent extensive time analyzing the tire industry, its 
perceived major competitors, potential markets, and its own strengths and 
weaknesses.  The Company believes that the tire industry is dominated by 
several large competitors, has competitive pressures from cheaper imported 
tires from the Pacific Rim, and maintains a commitment to the traditional 
pneumatic tire with innovations focusing on tread design, not tire design.  
The Company also feels that the tire industry can be divided into several 
segments each with its own dynamics, dominant companies, target customers, and 
competitive pressures.  See BUSINESS.

     The Company feels its strengths are in its technology and research and 
development capabilities.  Its weaknesses are in its size and financial 
capabilities and in changing original equipment manufacturer ("OEM") and 
consumer views on pneumatic tires and the advantages airless tires offer over 
pneumatic tires.  Based on this analysis of the tire industry by the Company, 
a two-pronged approach has been formulated by the Company's management to 
manufacture and market its airless tire concept.

     First, the Company has identified certain industry segments where it 
feels the cost of the tires, the consumer, and the competition will allow it 
to compete effectively against existing pneumatic tires and the companies that 
produce them.  Second, in industry segments where the Company feels it will 
not initially have the financial or manufacturing resources to compete 
effectively, the Company will seek industry partners to manufacture and market 
tires and tire-wheel assemblies developed from the Company's technology. 

     The Company believes that its two-pronged approach for manufacturing and 
marketing its airless tire technology and products will be the most cost 
effective means for the Company to be successful.  The Company is in the 
development stage and since its inception in January 1995 to December 31, 
1996, the Company has had an operating loss of $1,231,453 due to the cost and 
expenses associated with beginning operations.  The report of the Company's 
auditor at June 30, 1996 contains a going concern modification as to the 
ability of the Company to continue.  However, since that time, the Company has 
obtained substantial equity funding which the Company believes is sufficient 
to meet its working capital requirements.  The Company is currently operating 
at a loss of approximately $80,000 per month and expects operating expenses to 
continue at such rate until such time as the Company begins to receive 
revenues from the sale of its products. 
<PAGE> 8

     The Company's principal offices are located at 446 West Lake Avenue, 
Ravenna, Ohio  44266.  The Company's telephone number is (216) 296-8778. See 
RISK FACTORS and BUSINESS. 

The Offering

Selling Shareholders................ 155,000 shares of Common Stock

Shares Outstanding as of
 Prospectus Date.................... Common Stock:     4,546,748
                                     Preferred Stock:  -0-

Shares Outstanding after Offering... Common Stock:     4,546,748
                                     Preferred Stock:  -0-

Use of Proceeds..................... The Company will not receive any proceeds
                                     from the sale of the Common Stock by the
                                     Selling Shareholders.

Risk Factors........................ There are certain substantial risks
                                     associated with an investment in the
                                     Common Stock, including among others,
                                     risks associated with the absence of
                                     operating revenues or profitable
                                     operations.  See RISK FACTORS.

OTC Bulletin Board Symbol........... Common Stock:  ATYR

PAGE
<PAGE> 9

Summary Financial Information

     The following table sets forth selected summarized financial data for the 
Company at the dates and for the periods indicated.  The data should be read 
in conjunction with the financial statements and notes thereto set forth 
elsewhere in this Prospectus.

<TABLE>
<CAPTION>

     
                                                                                
            From
                                      For the Six                   For the 
Years           Inception on 
                                      Months Ended                  Years 
Ended             January 30,
                                      December 31,                  June 
30,                1995 through
                                    ------------------            
-------------------       December 31,
                                    1996          1995 (2)        
1996           1995 (2)       1996
                                 ----------    ----------      ----------     
----------    ------------
<S>                              <C>           <C>             <C>            
<C>           <C>
STATEMENT OF OPERATIONS DATA:
-----------------------------                                             
 Interest income................. $   7,480     $   4,655       $   8,161      
$   3,611     $  18,252
 Operating Expenses..............   394,213       275,068         
604,251        252,241     1,250,705
 Net Income (Loss)...............  (386,733)     (270,413)       
(596,090)      (248,630)   (1,231,453)
 Net Earnings (Loss) per share...     (0.09)        (0.07)          
(0.16)         (0.06)        (0.30)
 Weighted Average Number
  of Shares Outstanding.......... 4,118,480(1)  3,840,642       3,840,642      
3,800,000     4,118,480



                                       Actual as of
                                   ---------------------
                                   December 31   June 30
                                   -----------   -------
                                      1996 (1)     1996
                                   ----------   ----------
<S>                               <C>          <C>
BALANCE SHEET DATA:
------------------
 Cash, cash equivalent............ $  634,337   $    4,467
 Working Capital (Deficit)........    860,696     (385,521)
 Total Assets.....................  1,542,795      921,119
 Total Liabilities................     68,895      664,348
 Shareholders' Equity.............  1,473,900      256,771


(1)  Does not give effect to the issuance of 200,000 shares of restricted 
common stock and the payment of $400,000 in cash for the acquisition of UTI 
Chemicals (Europe), Ltd., effective February 28, 1997; the issuance of 15,000 
shares of common stock pursuant to the exercise of options granted under the 
Company's 1997 Non Qualified Stock Option Plan dated January 29, 1997; or the 
sale of 155,000 shares of restricted common stock and the receipt by the 
Company of $930,000, the proceeds therefrom in February 1997.

(2)  The Company was incorporated on January 30, 1995, therefore the six-month 
period and fiscal year ended June 30, 1995 represent partial periods.

</TABLE>


PAGE
<PAGE> 10

RISK FACTORS

     THE PURCHASE OF THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF 
RISK.  PROSPECTIVE INVESTORS SHOULD CONSIDER, IN ADDITION TO THE NEGATIVE 
IMPLICATIONS OF ALL MATERIAL SET FORTH HEREIN, THE FOLLOWING RISK FACTORS.

RISK FACTORS RELATING TO THE BUSINESS OF THE COMPANY

Start-up or Development Stage Company

     The Company has had limited operations since its organization and is a 
"start-up" or "development stage" company.  Although certain of the Company's 
Officers have had prior experience in the business of developing, 
manufacturing, and marketing tires and other products, no assurance can be 
given that the Company will be able to compete with other manufacturers of 
such products, virtually all of whom have substantially greater financial 
resources than the Company.  The purchase of the shares of Common Stock 
offered hereby must be regarded as the placing of funds at a high risk in a 
new or "start-up" venture with all the unforeseen costs, expenses, problems, 
and difficulties to which such ventures are subject.  Accordingly, the shares 
of Common Stock offered hereby should not be purchased by persons who cannot 
afford the loss of their entire investment.  See BUSINESS.

Ability of Company to Continue as a Going Concern 

     The report of the Company's auditors at June 30, 1996, contains a 
modification as to the ability of the Company to continue as a going concern. 
However, since the date of that report the Company has obtained substantial 
funding from the sale of its equity securities which the Company believes is 
adequate to satisfy its current working capital requirements to continue in 
business.  See FINANCIAL STATEMENTS. 

No Assurance of Profitability and Working Capital Deficit

      The Company had an operating loss of $1,231,435 since its inception 
through December 31, 1996 due to the costs and expenses associated with a 
start-up operation.  As of December 31, 1996, the date of the Company's most 
recent financial statements included in this Prospectus, the Company has 
experienced no revenues from the sale of any products, however the Company had 
working capital of $860,696.  The Company has only recently commenced the 
commercial sale of its products and has not received substantial revenues from 
operations.  There can be no assurance the Company will be able to develop 
into a successful or profitable business.  See BUSINESS.

Dependence on Management and Key Personnel 

     The Company has been substantially dependent on the services of Richard 
A. Steinke and Dennis S. Chrobak, two of the Company's Officers and Directors, 
and for some time will be dependent on the general business acumen and 
experience of all of its Officers and Directors and the application of such 
skills to the business decisions required on behalf of the Company.   The 
Company has entered into employment agreements with Messrs. Steinke and 
Chrobak for a three year period, however, the Company does not carry key-man 
insurance on either Mr. Steinke or Mr. Chrobak, thus, the loss of a key 
employee's services could have a material adverse effect on the Company's 
operations.  See MANAGEMENT.
PAGE
<PAGE> 11

Patents and Trademarks  

     The Company has acquired license rights to certain technology, 
proprietary data, and know-how relating to both a method for manufacturing a 
combined tire-wheel assembly ("DSS Technology") and for manufacturing a 
non-pneumatic tire ("Airless Tire Technology") for which applications for 
United States Letters Patent have been filed and are currently pending. The 
DSS Technology and Airless Tire Technology were invented by affiliates of the 
Company.  The DSS Technology and the Airless Tire Technology were obtained by 
the Company at no cost through technology license agreements with American 
Mobility Systems ("AMS"), an entity controlled by Richard A. Steinke and 
Dennis S. Chrobak.  The DSS Technology agreement provides for a royalty 
payment to AMS of either $1.00 for each unit of production manufactured and 
sold directly by the Company or eight percent (8%) of any royalty the Company 
should receive from third party licensees that utilize the DSS Technology.  
The Company will pay AMS a royalty of $0.25 for each tire sold by the Company 
utilizing the Airless Tire Technology.  In addition, to the extent that such 
technologies have not been developed to the point of practical application or 
that the safety and efficiency of the technologies has not yet been 
established, the Company has agreed to hold AMS harmless from all liabilities, 
costs, and fees relating to any claim, demand, or suit and the defense thereof 
arising from the use, sale, or license of the technologies. The DSS Technology 
and the Airless Tire Technology agreements were not negotiated at arms length. 
In addition, the Company has not obtained an opinion of an independent third 
party as to the fairness of the terms of the technology license agreements 
with AMS. See CERTAIN TRANSACTIONS.

     There can be no assurance that any patents relating to the DSS Technology 
or the Airless Tire Technology will in fact be issued to AMS or, if issued, 
that such patents will give the Company any protection against competitors or 
that such patents will not be infringed upon or modified by others.  The 
Company has not retained intellectual property counsel to render an opinion 
regarding the DSS Technology and the Airless Tire Technology as to whether the 
Company is infringing on the intellectual property rights of others.  In that 
regard, the Company believes that the DSS Technology is unique. See BUSINESS.

Dependence on AMS for Technical Assistance 

     The Company has acquired its technology from AMS, a corporation 
controlled by Richard A. Steinke and Dennis S. Chrobak, two of the Company's 
Officers and Directors.  It is probable that all new technology obtained by 
the Company may originate from AMS and will be licensed to the Company for 
development in exchange for the payment of a royalty.  The Company will be 
relying significantly on AMS to provide it with technical assistance, however, 
any new technology developed by the Company's employees within the scope of 
their employment or that otherwise relates to the nature of the Company's 
business will be considered the Company's proprietary technology.  The license 
agreements between the Company and AMS may be terminated by AMS upon the 
occurrence or continuance of any one or more events of default (e.g., failure 
to pay royalties when due) following written notice from AMS and the Company's 
failure to cure the default within 30 days of such notice.  See CERTAIN 
TRANSACTIONS.





<PAGE> 12

Product Liability Insurance 

     The sale of the Company's products may expose it to liability claims 
resulting from the use of such products.  Such claims may be expected to be 
larger in the specialty tire manufacturing area, where product failure may 
result in property and other damages, including injury to persons or loss of 
life. The Company has obtained product liability insurance which it believes 
to be sufficient to cover its existing product manufacturing requirements, 
however, no assurance can be given that such insurance will be adequate to 
cover potential claims or, that if a claim or claims are made, such insurance 
will not be canceled. 
     
Competition 

     The Company believes, that currently there are three foreign bicycle tire 
manufacturers that utilize a liquid phase technology manufacturing process to 
produce airless bicycle tires with only one marketing its tires in the United 
States.  In addition to manufacturers of airless bicycle tires, the Company 
will be competing directly with  firms that manufacture and/or market 
pneumatic bicycle tires.   The Company estimates that over 98% of all domestic 
bicycle tire sales are pneumatic tires.  The bicycle tire industry is highly 
competitive and there are several of the Company's competitors that have 
financial resources which substantially exceed those of the Company.

     Currently, there are no spare, passenger car, light, medium or heavy 
truck tire manufacturers that utilize the liquid phase technology 
manufacturing process to produce tires. Should the Company obtain FMVSS 129 
approval for its tire-wheel assembly and Hayes commences manufacturing and 
selling such tire-wheel assemblies,  the Company will be competing indirectly 
with companies that manufacture and/or market pneumatic tires for passenger 
vehicles and light trucks. Many of these companies have company owned outlets 
or franchised stores that sell products manufactured by these companies.   The 
Company believes that the motor vehicle tire market will be highly competitive 
and there could be several companies that manufacture pneumatic tires that 
have financial resources which exceed those of Hayes. Although the Company's 
tire-wheel assemblies will be unique in the tire marketplace, Hayes may be at 
a disadvantage in competing with older, larger, and more established companies 
while attempting to establish itself in the tire industry in general. See 
BUSINESS.

Potential Conflicts of Interest 

     The Company has in the past engaged in various transactions with its 
Officers, Directors, principal shareholders, and affiliates, including 
obtaining short-term loans, purchasing the Company's manufacturing facility, 
and obtaining licenses to certain technology.  Consequently, it is possible 
that potential conflicts of interest may arise in the future in connection 
with the interpretation and/or enforcement of the underlying agreements.  For 
example, the Company has recently entered into agreements with AMS to license 
certain technology.  It is probable that all technology obtained by the 
Company will originate from AMS and licensed to the Company for development of 
the technology in exchange for the payment of a royalty.  In addition, the DSS 
Technology and Airless Tire Technology agreements provide that AMS be paid for 
any technical assistance it provides the Company in further developing such 
technologies, if any. 



<PAGE> 13

     The Company will be relying significantly on AMS to provide it with 
technical assistance, however, any new technology developed by the Company's 
employees within the scope of their employment or that otherwise relates to 
the nature of the Company's business will be considered the Company's 
proprietary technology.  In this regard, Messrs. Steinke and Chrobak and/or 
AMS could retain possible business opportunities for themselves at the 
potential expense of the Company.  As a result, the Company may experience 
conflicts of interest relating to the appropriation of business opportunities 
by its Officers and Directors, the payment of royalties due under the 
agreement with AMS, and other matters.  If conflicts do arise, they will not 
be resolved through arms length negotiations, but through reliance on and 
enforcement of employment and confidentiality and non-disclosure agreements 
with Company employees and the exercise of management's judgment consistent 
with its fiduciary responsibility to the Shareholders.  All future 
transactions with affiliates will be for a bona fide business purpose and be 
on terms no less favorable than could be obtained from unaffiliated parties.  
See CERTAIN TRANSACTIONS.

Limited Liability of Management 

     The Nevada Revised Statutes generally provide that a company's directors 
shall have no personal liability to the company or its stockholders for 
monetary damages for breaches of their fiduciary duties as Directors, except 
for breaches of their duty of loyalty, acts or omissions not in good faith or 
which involve intentional misconduct or a knowing violation of law, acts 
involving unlawful payment of dividends or unlawful stock purchases or 
redemptions, or any transaction from which a director derives an improper 
personal benefit.  Accordingly, Shareholders may have no recourse against 
Directors of the Company for bad business decisions.  However, liability of 
Directors for violation of the federal securities laws is not limited by these 
provisions.

Regulation and Environmental Considerations 

     The Company is subject to various local, state, and federal laws and 
regulations including, without limitation, regulations promulgated by federal 
and state environmental, health, and labor agencies, and has engaged a 
consultant to advise it with respect to compliance with applicable 
environmental regulations.  Prior to commencing operations the Company spent 
$5,140 to comply with various environmental regulations and no additional 
expenditures by the Company have been required. However, changes in the laws 
and regulations governing the Company's business may impose an increased financi
al burden upon the Company that could adversely affect the Company's business 
or operations.  Actions by federal, state, and local governments concerning 
environmental or other matters could result in regulations that could increase 
the cost of producing the products to be manufactured and sold by the 
Company. 

      Certain of the Company's operations will be subject to federal, state, 
and local laws and environmental regulations that impose limitations on the 
discharge of pollutants into the air and/or water.  The Company believes that 
it will be able to operate in compliance with such regulations.  While the 
Company has not had to make significant capital expenditures relating to 
environmental compliance, the Company cannot predict with any certainty its 
future capital expenditure requirements relating to environmental compliance 
because of its limited operations and continually changing compliance 
standards and technology.  See BUSINESS. 

<PAGE> 14

Lack of Insurance for Environmental Liabilities

     The Company does not have insurance coverage for environmental 
liabilities and does not anticipate obtaining such coverage in the future.  
See BUSINESS. 

Issuance of Additional Common Stock and Preferred Stock 

     The Company currently has authorized 25,000,000 shares of Common Stock, 
par value $0.001 per share, of which 4,546,748 shares were issued and 
outstanding prior to this Offering.  The Company currently has authorized 
5,000,000 shares of Preferred Stock, par value $0.001 per share, of which no 
shares were issued and outstanding.  Although the Company's Board of Directors 
has no present intention to do so, the Board of Directors has authority, 
without action by or vote of the Company's Shareholders, to issue all or part 
of the authorized but unissued shares.  In addition, the Company's Board of 
Directors has authority, without action by or vote of the Company's Shareholders
, to fix and determine the rights, preferences, and privileges of the 
Preferred Stock, which may be given voting rights superior to that of the 
Common Stock, which power may be used to hinder or deter a takeover proposal, 
should any occur.  Any issuance of additional shares of Common Stock or 
Preferred Stock will dilute the percentage ownership interest of Shareholders 
and may further dilute the book value of the Company's shares.  See 
DESCRIPTION OF CAPITAL STOCK. 

Common Stock Could Become a Designated Security/Penny Stock 

     Should the bid price for the Company's Common Stock fall below $5.00 per 
share, the Company's Common Stock would become subject to special sales 
practice requirements applicable to "designated securities" and "penny 
stock".  No assurance can be given that the bid price for the Company's Common 
Stock will continue to be above $5.00 per share. If such $5.00 minimum bid 
price is not maintained and another exemption is not available, the Company's 
Common Stock would become subject to additional sales practice requirements 
imposed on broker-dealers who sell the Common Stock to persons other than 
established customers and accredited investors (generally institutions with 
assets in excess of $5,000,000 or individuals with net worth in excess of 
$1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their 
spouse).  

     For transactions covered by these rules, the broker-dealer must make a 
special suitability determination for the purchaser and have received the 
purchaser's written agreement to the transaction prior to the sale.  These 
rules may be anticipated to affect the ability of broker-dealers to sell the 
Company's Common Stock, which may in turn be anticipated to have an adverse 
impact on the market price for the Common Stock and the ability of purchasers 
to sell their shares in the secondary market.  The Company believes that if 
the bid price should fall below $5.00 per share it would continue to be exempt 
from the sales practice requirements because it would meet certain minimum 
asset and net worth tests.  No assurance can be given however, that the 
Company will be able to meet the terms of such exemption or that, if met 
initially, it would continue to meet the terms of such exemption in the 
future.

Lack of Dividends 

     The Company has not paid, and does not plan to pay, dividends in the 
foreseeable future even if the Company is profitable.  Earnings, if any, are 
expected to be used to expand the Company's operations and for general 
corporate purposes, rather than to make distributions to Shareholders.
<PAGE> 15

Possible Sale of Common Stock Pursuant to Rule 144 

     The Company has previously issued shares of Common Stock that constitute 
"restricted securities" as that term is defined in Rule 144 adopted under the 
Securities Act.  Subject to certain restrictions, such securities may 
generally be sold in limited amounts two years after their acquisition.     
The Commission has recently adopted a proposal to reduce the holding period 
prior to which shares may be eligible for resale under Rule 144 from two years 
to one year.  The amendments to Rule 144 take effect on April 29, 1997, and 
once effective, the rule will allow the above mentioned restricted securities 
to be eligible for resale one year earlier.

     The Company issued 2,510,000 shares of Common Stock to initial 
Shareholders in connection with its organization.  The Company issued an 
additional 300,000 shares of Common Stock to various individuals for 
professional and consulting services during February 1995.  In April 1995, the 
Company issued 170,000 shares to certain Officers and 100,000 shares for 
professional services.  In May 1995, the Company issued 720,000 shares in a 
private placement.  The shares issued to insiders (2,510,000 shares to 
founders and 170,000 shares to other Officers) are currently eligible for 
resale under Rule 144.  However, in connection with the Company's initial 
public offering, the Company's Officers, Directors, and Shareholders owning 
more than 5% of the Company's issued and outstanding shares of Common Stock 
agreed not to sell any shares owned directly or indirectly by them for a 
period of up to four years, subject to the Company obtaining certain net 
earnings requirements.

     The 400,000 shares of Common Stock issued to consultants for professional 
services in February and April 1995 were issued pursuant to an exemption from 
registration available under Rule 701 of the Securities Act, and are now 
eligible for resale pursuant to the resale limitations set forth in Rule 
701(c) which provides that 90 days after the Company becomes subject to the 
reporting requirements of Section 13 or Section 15(d) of the Securities 
Exchange Act of 1934 (i.e., May 28, 1996), securities issued in a Rule 701 
transaction may be resold by persons other than affiliates in reliance on Rule 
144, without compliance with (1) current information, (2) holding period, (3) 
volume limitation, and (4) notice requirements of Rule 144; and by affiliates 
without compliance with the holding period requirements of Rule 144.

     The 720,000 shares of restricted Common Stock sold by the Company in the 
May 1995 will become eligible for sale under Rule 144 in May 1997. Sales of 
these restricted securities under Rule 144 or otherwise may have a depressive 
effect on the price of the Company's Common Stock in any trading market that 
may develop following this Offering.  After the implementation of the 
amendment to Rule 144, securities held for two years may be sold by 
nonaffiliates without limitation.  See PRINCIPAL SHAREHOLDERS and DESCRIPTION 
OF CAPITAL STOCK. 

PAGE
<PAGE> 16

PLAN OF DISTRIBUTION

Selling Shareholders

     The Selling Shareholders may sell up to 155,000 shares of Common Stock 
from time to time directly to purchasers.  Alternatively, the Selling 
Shareholders may, from time to time, offer the Common Stock to underwriters, 
dealers, or agents, which may receive compensation in the form of underwriting 
discounts, concessions, or commissions from the Selling Shareholders and/or 
the purchasers of the Common Stock from whom they may act as agent, as the 
case may be.  The Selling Shareholders and any underwriters, dealers, or 
agents that participate in the distribution of such securities, may be deemed 
to be "underwriters," and any profits on the sale of these securities by them 
and any discounts, commissions, or concessions received by any underwriters, 
dealers, or agents may be deemed to be underwriting discounts and commissions 
under the Securities Act.

     The Common Stock may be sold by the Selling Shareholders, as the case may 
be, from time to time, in one or more transactions at a fixed offering price, 
which may be changed, or at varying prices determined at the time of sale or 
at negotiated prices.  The Company does not intend to enter into any 
arrangements with any securities dealers concerning solicitation of offers to 
purchase the Common Stock.  The Selling Shareholders will pay all separate 
expenses incurred by them incident to the offer and sale of the Common Stock, 
including commissions and discounts to broker-dealers.

     Commissions and discounts paid in connection with the sale of the Common 
Stock by the Selling Shareholders will be determined through negotiations 
between them and the broker-dealers through or to which the securities are to 
be sold and may vary, depending on the broker-dealers fee schedule, the size 
of the transaction, and other factors.  The separate costs of the Selling 
Shareholders will be borne by them.  The Selling Shareholders and any 
broker-dealer or agent that participates with the Selling Shareholder in the 
sale of the Common Stock by them may be deemed "underwriters" within the 
meaning of the Securities Act, and any commissions or discounts received by 
them and any profits on the resale of Common Stock purchased by them may be 
deemed to be underwriting commissions under the Securities Act.

     The Company has agreed to pay all expenses incurred by the Company in 
registering the Common Stock for resale by the Selling Shareholders.  In 
addition, the Company has agreed to utilize its best efforts to keep the 
registration statement effective until February 16, 1998.  The Company is 
under no obligation to maintain the effectiveness of any registration 
statement beyond February 16, 1998, or that date following the date on which 
all the shares of Common Stock registered pursuant to this registration 
statement have been sold by the Selling Shareholders, which ever occurs 
first.  PAGE
<PAGE> 17

SELLING SHAREHOLDERS

     The following table provides certain information with respect to the 
Common Stock held by each Selling Shareholder.  None of the Selling 
Shareholders has had a material relationship with the Company.  The percent of 
Common Stock is calculated on the number of the Company's shares issued and 
outstanding as of the date of this Prospectus.  None of the shares of Common 
Stock may be offered and sold by the Selling Shareholders after February 16, 
1998.  The Common Stock offered by the Selling Shareholders under this 
Prospectus may be offered from time to time by the following persons:

Name of Shareholder                       Number of Shares  % of Common Stock
-------------------                       ----------------  -----------------
Lowell L. Leishman                               12,000               .26 
2156 Associates, a Utah partnership              20,000               .44
William L. Jiler                                 15,000               .33 
Matthew L. & Erin S. Haynie, JTWRS                3,000               .07 
Graphic Arts Management Profit Sharing Plan      15,000               .33 
Frank Lankey                                      5,000               .11 
Jay M. Grossman                                   3,000               .07 
Richard K. & Janice S. Milne, JTWRS               5,000               .11 
James & Carolee Okland, JTWRS                     4,000               .09 
Henry D. Moyle                                   20,000               .44 
David P. Scheffenacker                            4,000               .09 
Theodore S. Green & Debra Beneck                  3,000               .07 
Adele Gilchrist                                   1,000               .02 
Carol H. Tate                                     1,000               .02 
Jeffrey W. Gold, IRA                              6,000               .13
Jeffrey W. & Robyn Gold, JTWRS                   14,000               .31
Louis M. Haynie                                  14,000               .31 
Joseph S. Haynie                                  1,000               .02 
Michael L. Haynie                                 3,000               .07 
Gae B. Haynie                                     2,000               .04 
Gary R. Howe, IRA                                 1,000               .02
Gary R. & Sharon F. Howe, JTWRS                   3,000               .07
                                           ------------   ----------------
Totals                                          155,000              3.42 
                                           ============   ================

PAGE
<PAGE> 18

MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Plan of Operation

     The Company's is engaged in the manufacturing, marketing, distribution, 
and sale of airless specialty tires utilizing "liquid phase" technology.  
"Liquid Phase" technology refers to a production process where the materials 
that are utilized in the process are initially in a liquid state and, through 
a reaction (usually chemical), the liquid materials are transformed into a 
solid state.

     The Company operates "centrifugal molding machines" and other related 
specialized manufacturing equipment to produce the airless bicycle tires. The 
Company has utilized funds from its initial public offering to purchase 
additional molding machines and related production equipment, which is 
currently being installed and will be ready for production during April 1997.

     The Company is in the development stage and has only recently began 
manufacturing operations. The Company has had an operating loss of $1,231,453 
since its inception through  December 31, 1996 due to the costs and expenses 
associated with beginning operations.  The Company's audited financial 
statements at June 30, 1996, contained a going concern modification as to the 
ability of the Company to continue.  However, In October 1996, the Company 
received $2,064,498 from its initial public offering, which the Company 
believes will provide it with sufficient working capital to fund operations.  
The Company is currently operating at a loss of approximately $80,000 per 
month and expects operating losses to continue at such rate until such time as 
the Company begins to receive revenues from the sale of its products.

     At December 31, 1995, the Company had only been organized for eleven 
months and had no significant operations, therefore management's discussion 
and analysis of the prior period ended December 31, 1995 with the current 
period ended December 31, 1996, would not be conducive to an understanding of 
the Company and its fiscal condition or have any meaningful significance.

     On November 11, 1996, the Company received a commitment for a line of 
credit of $500,000 from a commercial lender for working capital and equipment 
purchases.  This line of credit will bear an interest rate of 3/4% over prime 
and will be secured by the Company's accounts receivable, inventory, equipment 
and a first mortgage on the Company's Ravenna facility.  At December 31, 1996, 
the Company had not made any draws against the line of credit.

     On October 31, 1996, the Company approved the issuance of 27,000 shares 
of the Company's restricted common stock in exchange for the cancellation of 
approximately $56,735 in principal and accrued interest due certain of its 
officers and directors. 

     In February 1997, the Company raised offering proceeds of $930,000 from 
the sale of 155,000 shares of restricted common stock in a private placement.  
The 155,000 shares of Common Stock sold in that private placement are the same 
155,000 shares of Common Stock being offered hereunder by the Selling 
Shareholders.  See SELLING SHAREHOLDERS. 

     The Company will be relying on the proceeds from the Company's recent 
securities offerings and the Company's line of credit to meet further 
operating requirements should the Company fail to receive sufficient revenues 
from the sale of products to meet its operational needs.  

<PAGE> 19

     On January 2, 1997, the Company entered into an Agreement in Principle 
with Coronel Investments Limited ("Coronel") to purchase all of Coronel's 
ownership interest in the capital stock of UTI Chemicals (Europe) Ltd., a 
United Kingdom company ("UTI-UK"), in exchange for 200,000 shares of the 
Company's common stock and a cash payment of $400,000.  UTI-UK is a 
distributor of urethane products in the United Kingdom and Europe.  Effective 
February 28, 1997, the Company completed the acquisition of UTI-UK. 

BUSINESS

Organization and Corporate History

     The Company was organized on January 30, 1995, by Richard Steinke and 
Dennis Chrobak to take advantage of existing proprietary and non-proprietary 
technology available for the manufacturing of specialty tires. Mr. Steinke has 
several years experience in top-management positions in public companies 
engaged in manufacturing products utilizing emerging technology and personally 
holds patents on urethane products and processes.  In addition, Mr. Chrobak 
has over 30 years of tire industry experience in tire design, manufacturing, 
and marketing as an engineer for Goodyear Tire and Rubber Company and 
personally holds patents on tire structures and manufacturing processes. The 
Company has had limited operations since its organization and is a 
"development stage" company.  However, the Company believes that the 
experience and intellectual contributions of Mr. Steinke and Mr. Chrobak to 
the Company are key components to the future success of the Company.

     Following its organization, in May 1995 the Company completed a private 
placement of 720,000 shares of Common Stock to a limited number of investors, 
raising net proceeds of $641,729, after deducting sales commissions of 
$70,000, and $8,271 in offering expenses.  The funds received by the Company 
were utilized to purchase a manufacturing facility in Ravenna, Ohio, and to 
purchase specialized manufacturing equipment. In September 1995, the Company 
sold an additional 40,642 shares in a private placement raising gross proceeds 
of  $243,852.   No commissions were paid, directly or indirectly, in 
connection with the sale of those shares.   The proceeds from these prior 
offerings have been utilized by the Company to fund its ongoing operations.  
The 40,642 shares of Common Stock sold in September 1995 have been subject to 
a Recision Offer and in October 1996, the Company repurchased from investors 
34,977 shares for an aggregate of $193,704, which amount includes all accrued 
interest.   

     In October 1996, the Company completed an initial public offering of 
344,083 shares of Common Stock at a purchase price of $6.00 per share for 
gross offering proceeds of $2,064,498.  The Company has used the proceeds from 
the offering to initiate production of airless tires which will compete with 
the traditional pneumatic tires (i.e., tires with an inner tube or tubeless 
tires inflated with air), repurchase the shares of Common Stock subject to the 
Recision Offer, repay loans from Officers, and for working capital.

     Effective February 28, 1997, the Company completed the acquisition of all 
of the capital stock of UTI-UK.  The acqusition was made pursuant to a Share 
Purchase Agreement, wherein the Company agreed to acquire UTI-UK from Coronel 
in exchange for the payment of 200,000 shares of the Company's restricted 
common stock and a cash payment of $400,000. The Company utilized proceeds 
derived from the February 1997 private placement to make the cash portion of 
the purchase price.  The closing bid price for the Company's common stock on 
February 28, 1997 (the "Closing Date") was $7.75.

<PAGE> 20

     Based on the closing bid price for the Company's common stock and the 
$400,000 cash, the purchase price of UTI-UK was valued at $1,950,000.  For 
purposes of accounting treatment, the acquisition of UTI-UK will be treated as 
a purchase by the Company.

     UTI-UK has since 1990 been a distributor of urethane bicycle, wheelchair 
and other specialty tires in the United Kingdom and Europe.  UTI-UK 
distributes urethane bicycle tires under the trade name "Urathon TM" in 
approximately 540 Michelin Tire Company owned ATS stores in England, Scotland 
and Wales.  UTI-UK also sells product in France, Denmark, Austria, the 
Netherlands and Germany through independent representatives and distributors.

     In connection with the acquisition of UTI-UK, the Company and Coronel 
entered into a lock-up agreement, wherein Coronel agreed not to sell during 
the 24 month period following the Closing Date (i.e., through March 1, 1999), 
more than 50,000 shares of the Company's common stock acquired, provided 
however, all such sales of the Company's common stock during the lock-up 
period are made in a market transaction pursuant to an effective registration 
statement or in reliance on an exemption from registration under the 
Securities Act of 1933, as amended.

     In addition, the Company entered into a management agreement with 
Coronel, wherein Coronel has been retained to manage the day-to-day operations 
of UTI-UK for a 12-month period beginning February 1, 1997, in exchange for a 
monthly fee of US$9,990, and Hugh-Sims Hilditch, the principal shareholder of 
Coronel was appointed to the Company's board of directors and to serve as 
Managing Director for European Operation.

Business in General

     The Company has spent extensive time analyzing the tire industry, its 
perceived major competitors, potential markets, and its own strengths and 
weaknesses.  The Company believes that the tire industry is dominated by 
several large competitors, has competitive pressures from cheaper imported 
tires from the Pacific Rim, and maintains a commitment to the traditional 
pneumatic tire with innovations focusing on tread design not tire design.  The 
Company also feels that the tire industry can be divided into several segments 
each with its own dynamics, dominant companies, target customers, and 
competitive pressures. The Company believes that its technology will allow it 
to produce an airless tire which offers the same safety and ride as the 
traditional pneumatic tire, at competitive prices, without the associated 
problems resulting from a flat tire.  The ability to avoid down time from flat 
tires will be particularly appealing to industrial concerns where down time 
can be readily equated into lost dollars.

     The Company feels its strengths are in its technology and research and 
development capabilities.  Its weaknesses are in its size and financial 
capabilities and in changing Original Equipment Manufacturer ("OEM") and 
consumer views on pneumatic tires and the advantages of going airless.  Based 
on this analysis of the tire industry, a two-pronged approach has been 
formulated by the Company's management to manufacture and market its airless 
tire concept.
PAGE
<PAGE> 21

     First, the Company has identified certain industry segments where it 
feels the cost of the tires, the consumer, and the competition will allow it 
to compete effectively against existing pneumatic tires and the companies that 
produce them.  These industry segments are segments the Company feels will be 
accessible, its products will be readily acceptable, and the Company will not 
be at an insurmountable competitive disadvantage.  One such area is the 
bicycle tire market where almost all tires are currently imported.  The 
Company feels it can offer the end user the advantage of not having to worry 
about flats or leaks.

     Second, in industry segments where the Company feels it will not 
initially have the financial or manufacturing resources to compete 
effectively, the Company will seek an industry partner to manufacture and 
market  tires products developed from the Company's technology.  The Company 
will, therefore, have a very fluid organization that will not be bound to the 
traditional role as strictly a manufacturer and marketer of products, but 
instead, a company exploring the non-traditional avenues, including joint 
ventures for developing and licensing the Company's technology.  The Company 
feels that through these means, with respect to some products developed 
utilizing the Company's technology, the Company will be able to attain broader 
public recognition without incurring the additional equipment and related 
costs and expenses associated with being strictly a manufacturer and marketer. 
With respect to products developed through joint ventures and license 
agreements, the Company will maintain a profit interest by having a royalty or 
other carried interest in every unit of production sold through such 
arrangements based on gross sales price.

Hayes Development and License Agreement

     In September 1995, the Company and Hayes Wheels International ("Hayes") 
entered into a Development and License Agreement (the "Hayes Development and 
License Agreement") wherein the Company and Hayes have agreed to jointly 
develop a prototype tire-wheel assembly utilizing the DSS Technology, together 
with associated molds and equipment, for submission to the United States 
Department of Transportation ("DOT") for DOT's approval under FMVSS 129. Under 
the joint development aspect of the Hayes Development and License Agreement, 
the Company will, at its cost, develop and manufacture the molds and process 
for applying side coverings, elastomeric tread, and a cap stabilizer onto the 
Hayes manufactured DSS.  Hayes, at its cost, will develop and manufacture 
molds and equipment to manufacture the steel portion of the DSS.  FMVSS 129 is 
the applicable U.S. safety standard for non-pneumatic tires used on passenger 
vehicles and describes the energy cycle a non-pneumatic tire/wheel must absorb 
to be provided for commercial sale in the United States.  The Company has 
received prototype wheels from Hayes, built the molds for applying the side 
coverings, tread, and stabilizing cap, and produced several tire-wheel 
assembly prototypes that have been delivered to an independent lab for testing 
to ensure that the tire/wheel assembly complies with FMVSS 129. The Company 
has submitted for testing 7 of 10 planned submissions to an independent 
laboratory.  The tests performed have been designed to provide the Company 
with data relating to the dynamics, material composition, and performance of 
the tire-wheel assembly. From the data developed from testing of the first 
seven prototypes, the Company has established what the Company and Hayes 
believe to be the best design and polymer compound for the tire-wheel assembly 
to meet the requirements of FMVSS 129.  The final three submissions will be 
based on that design and polymer compound. Because of limited working capital, 
the Company had suspended prototype testing until completion of its initial 
public offering.  The Company plans to resume prototype testing beginning in 
May 1997.

<PAGE> 22

Airless Bicycle Tires

     Airless bicycle tires differ from pneumatic tires in that pneumatic tires 
are made from rubber and require an inner tube which is inflated with air, 
while the Company's airless bicycle tires are manufactured from polyurethane, 
have no inner tube (solid throughout), and do not require inflation.  The 
airless bicycle tire is mounted on the bicycle rim in much the same way a 
pneumatic tire is mounted, with the assistance of a special tire lever.  The 
Company will provide with each tire, special tire levers, (about 12 inches 
long to provide for sufficient leverage), to assist  the cyclist in mounting 
the tire to the wheel rim.  The airless bicycle tires are approximately the 
same weight as pneumatic tires and tubes and ride characteristics are 
comparable. Apart from cleaning, the Company's bicycle tires are maintenance 
free.  This is of particular importance in relation to braking performance.  
Pneumatic tires normally require regular attention to maintain full inflation 
pressure to ensure correct brake operation.  The Company's airless bicycle 
tires eliminate tedious puncture repair or the need for a bicycle pump.  They 
are designed  for use by  "On/Off" road and "Highway" bicycles.  The Company 
will initially market the airless bicycle tires in two colors, fluorescent 
yellow and conventional black, however, it may choose to introduce additional 
colors in the future.

     The Company's marketing strategy will be to initially introduce the 
bicycle tires through sales to OEMs and direct advertising to consumers 
through television commercials. The Company intends to target two main 
consumer segments of the bicycle tire market:

     (1)  Original Equipment Manufacturers.  Based on 1993 data, OEM purchases 
of bicycle tires made up one-third of the total volume of the bicycle tire 
market.  By selling to OEM's, the Company believes it will be able to develop 
product identification and consumer demand by emphasizing "Made in the USA," 
the "airless," "maintenance free," and "puncture proof" characteristics of the 
bicycle tires while relying on the efforts of the OEM in marketing their 
bicycles.   The Company has made production molds to produce bicycle tires for 
Huffy Bicycle, Celina, Ohio to produce eight lines in four sizes (i.e., 26", 
24", 20", and 16" x 1.95") for use with Huffy's 1997 production bicycles. 
Huffy has prepared its 1997 Bicycle Catalog featuring bicycles equipped with 
the Company's airless tires.  Huffy is marketing the airless tires as the 
EnviroSafety Tire ("EST") that never goes flat and has placed an open order 
with the Company to deliver 50,000 tires in varying sizes during 1997, subject 
to meeting mutually agreeable pricing for the product.

     (2)  Direct Advertising.  In April 1995, the Company entered into a 
television commercial agreement with American Independent Network of Ft. 
Worth, Texas ("AIN"), to air a commercial (the "Commercial") produced by the 
Company for a one year period beginning as soon as airless bicycle tires are 
available for shipment.  AIN covers 129 stations, in 75 markets, covering 
34,668,949 households.  AIN will air the Commercial at times selected by it 
and the Company at time slots between 6:00 AM and 12:00 Midnight on an average 
of once an hour, with particular emphasis placed during the airing of 
afternoon children's programs, news reports, and sports programming.  The 
total program will give the Company approximately 10 airings per day during 
the one year term.  The Company has established an 800 telephone number that 
will allow customers to call the Company to make purchases direct from the 
Company utilizing a credit card.  The Company has agreed to pay AIN a 
commission of $2.00 for each bicycle tire sold by the Company resulting from 
direct advertising effort.  The Company has not made any substantive studies 
to determine the degree of market penetration it can reasonably expect to 
obtain from the airing of the Commercial, nor has it established an exact date 
to begin airing the Commercial.
<PAGE> 23

Competition

     Currently, there are three tire manufacturers that utilize a liquid phase 
technology manufacturing process to produce airless bicycle tires (Green Tire, 
Norwich, UK; Woo Tire, Waihai, China; and Krypton-India, Calcutta, India), and 
very limited numbers of their airless bicycle tires have been marketed  in the 
United States.  The technology that these companies use to manufacture their 
bicycle tires was originally developed by Vincent Panaroni, who has in the 
past provided consulting services to the Company, and the co-inventor of the 
Company's Airless Tire Technology. See MANAGEMENT.

     The Company's Airless Tire Technology differs from the existing 
technology in (1) the formulation of the polyurethane; (2) the manner in which 
the polyurethane is distributed throughout the mold; (3) and implementation of 
a circumferential steel cord; (4) the manner in which the tire seats in the
wheel rim; and (5) the manner in which the tire is manufactured to comply with 
ISO and U.S. tire and rim specifications and U.S. truth-in-labeling laws.  In 
addition to manufacturers of airless tires, the Company will be competing 
directly with firms that manufacture and market pneumatic bicycle tires.

     The Company estimates that over 98% of all domestic bicycle tire sales 
are pneumatic tires.  The bicycle tire  industry is highly competitive and 
there are several of the Company's competitors that have financial resources 
which substantially exceed those of the Company.  In addition, many 
competitors are large companies (i.e. Michelin [France], Kenda [Japan], and 
Chengshin Rubber [China]) that have established name recognition of their 
product, have established distribution networks for their products, and 
developed consumer loyalty to such products.  The Company knows of no domestic 
manufacturer of pneumatic bicycle tires.  Principal factors in marketing the 
Company's bicycle tire will be that it is domestically produced with "airless" 
and "puncture proof" characteristics.  This may give the Company a competitive 
advantage against pneumatic bicycle tires produced by foreign manufacturers 
that are subject to puncture and loss of air.

     Currently, there are no spare, passenger car, light, medium or heavy 
truck tire manufacturers that utilize the liquid phase technology 
manufacturing process to produce tires and the Company knows of no other 
company that has developed a combined tire-wheel assembly for motor vehicles.  
The Company is utilizing an established industry partner to bear the cost of 
manufacturing and marketing spare, passenger car, and light truck tires 
developed from DSS technology.  Therefore, the Company will be competing 
indirectly with companies that manufacture and/or market pneumatic passenger 
vehicle and light truck tires [i.e., Goodyear, Michelin, and Bridgestone].  
Many of these companies have company owned outlets or franchised stores that 
sell products manufactured by these companies. The Company feels that the car 
and truck tire market will be highly competitive and there may be several 
companies that manufacture pneumatic tires that have financial resources which 
exceed those of the Company and its industry partners.  Although the Company's 
airless automobile and truck tires will be unique in the tire market place, 
the Company will be at a disadvantage in competing with older, larger, and 
more established companies while attempting to establish itself in the tire 
industry in general.
PAGE
<PAGE> 24

Manufacturing, Supplies, and Quality Control

     The Company manufactures the airless bicycle tires utilizing single 
and/or multiple head, centrifugal molding machines.  These machines 
centrifugally mold elaster products, such as the bicycle tires, by pouring a 
predetermined amount of polyurethane into a mold, which is then spread out in 
the mold through centrifugal force.  The molding process occurs when the 
liquid polyurethane formula (made up of isocyanide and polyol) is combined 
with a catalyst. This combination causes a chemical reaction that results in 
the cross linking of the chemicals, which thereafter become solid.  The mold 
then moves to the next station where the tire is removed and the process 
continues.

     The Company has recently installed an additionaly 12-station carousel and 
the Company estimates that a crew of three persons will be able to produce 
approximately 4,000 tires in an 8 hour shift, or approximately 1,000,000 tires 
per year utilizing the Company's existing production equipment.  The Company 
estimates that it could produce about 12 to 15 million tires per year without 
expansion from its Ravenna facility. At that level of production, the Company 
would require approximately 200 employees.  The Company will train its 
employees in the use of this specialized manufacturing equipment and process, 
which will be utilized for other types of specialty tires as well.  The 
Company intends to utilize multiple suppliers to purchase polyurethane and 
believes that it will be able to obtain significant quantities of polyurethane 
and other chemicals without significant problems or delays.

     All products produced by the Company will be inspected following the 
manufacturing process and prior to shipment to ensure quality.  Products 
considered by the Company's quality control personnel to be defective could be 
ground into pellets, which can be melted and reused in the Company's 
manufacturing process to make new products and reduce waste of raw materials.

Patents

     Dynamic Steerable Spring

     On June 5, 1995, the Company entered into a technology license agreement 
(the "DSS License Agreement") with American Mobility Systems, Inc., a Nevada 
corporation ("AMS"), controlled by Dennis S. Chrobak and Richard A. Steinke, 
affiliates of the Company, to develop DSS Technology.  DSS Technology is a 
combination of a spring compressively loaded and a one piece spiral hoop load 
in tension.  DSS Technology can be utilized in tire-wheel assemblies for many 
types of mobile products including spare tires, passenger car tires, and 
light, medium, and heavy truck tires.  AMS is the owner of the DSS Technology 
for which an application for United States Letters Patent has been filed and 
issuance of a patent is pending. The term of the DSS License Agreement will be 
for  the life of the underlying U.S. patent when issued.  The Company is 
required to pay a royalty to AMS of either $1.00 for each unit of production 
manufactured and sold directly by the Company or eight percent (8%) of any 
royalty the Company should receive from third party licensees that utilize the 
DSS Technology.
PAGE
<PAGE> 25

     Airless Bicycle Tires

     On October 27, 1995, the Company entered into a technology license 
agreement (the "Airless Tire License Agreement") with AMS, to develop certain 
technology relating to an airless bicycle tire for which AMS has filed an 
application for United States Letters Patent and the issuance of a patent is 
pending.  The term of the Airless Tire License Agreement will be for the life 
of the underlying U.S. patent when issued.  The Company is required to pay a 
royalty to AMS of $0.25 for each bicycle tire manufactured and sold by the 
Company utilizing the technology.

     The Company has not yet received from the United States Patent Office any 
response passing on the patentability of the claims of the case with respect 
to the either the DSS Technology or the Airless Bicycle Tire Technology.  The 
Company is unable to predict when any office action will be taken or a patent 
issued.  Although a patent has a statutory presumption of validity in the 
United States, the issuance of a patent is not conclusive as to its validity, 
nor as to the enforcement scope of the claims contained therein.  The Company 
intends to, but has not as of the date of this Prospectus, applied for patent 
protection in other countries.  The Company intends to vigorously police its 
patent and there can be no assurance that its patent will not be infringed 
upon or modified by others.

     The Company has not retained intellectual property counsel to render an 
opinion regarding the DSS Technology and the Airless Tire Technology as to 
whether the Company is infringing on the intellectual property rights of 
others.  In that regard, the Company believes the DSS Technology is unique in 
that the Company knows of no other manufacturer of  airless passenger vehicle 
tires or tire-wheel assemblies.  With respect to the Airless Bicycle Tire 
Technology, the Company believes that its technology substantially differs 
from the existing technology currently being utilized to produce airless 
bicycle tires.  The Company believes that although its patents are important, 
such factors as product innovation, technical expertise and experience, and 
the confidentiality of proprietary data and trade secrets are equally as 
important.  The Company will attempt to preserve and protect its proprietary 
technology principally through trade secret protection and has obtained 
confidentiality/nondisclosure agreements with all of its employees.

Trademark

     Through its wholly owned subsidiary UTI-UK, the Company owns the U.S. 
registered trademark "Urathon TM" which has been utilized by UTI-UK on 
urethane tire products distributed in the United Kingdom and Europe.
PAGE
<PAGE> 26

Regulation and Environmental Compliance

     In connection with the manufacturing of airless bicycle tires, the 
Company knows of no particular federal or state regulations applicable to its 
manufacturing process.  However, the Company intends to manufacture its 
bicycle tires in compliance with any applicable ISO standards.  Certain tire 
wheel assemblies designed to be manufactured for use on passenger vehicles and 
light trucks are required to meet certain Department of Transportation, 
Federal Motor Vehicle Safety Standards ("FMVSS"), including FMVSS 129, which 
applies to non-pneumatic tires for passenger cars.  This standard specifies 
tire dimensions and laboratory tests requirements for lateral strength, 
endurance, and high speed performance, defines the tire load rating, and 
specifies labeling requirements for non-pneumatic spare tires.  All tire-wheel 
assemblies for use in passenger car and light truck applications developed by 
the Company will be engineered to meet applicable FMVSS standards. 

     The Company is subject to various local, state, and federal laws and 
regulations including, without limitation, regulations promulgated by federal 
and state environmental and health agencies, the federal Occupational Safety 
and Health Administration, and laws pertaining to hiring, treatment, safety, 
and discharge of employees.  The Company's manufacturing operations must also 
meet federal, state, and local regulatory standards in the areas of labor, 
safety, and health.  Since its inception, the Company has spent $5,140 to 
comply with various environmental regulations and no additional expenditures 
by the Company have been required.  The Company believes that it will be able 
to operate in compliance with such regulations, including laws related to the 
handling and use of environmentally hazardous materials.

Employees

     As of March 31, 1997, the Company had 16 full-time employees.  All of the 
Company's Officers and key personnel are employees at will, except Messrs. 
Steinke and Chrobak.  None of the Company's employees is represented by a 
labor union.  The Company believes that it will be able to hire a sufficient 
quantity of qualified laborers in the local area to meet the Company's 
employment needs.  The Company's manufacturing process does not require 
special training, other than orientation to the Company's production 
techniques and specific equipment. 


PROPERTIES

Offices

     The Company's 26,000 sq. ft. manufacturing/distribution/office facility 
is located on 4.15 acres of real property at 446 West Lake Street, Ravenna, 
Ohio, and consists of 1,000 sq. ft. of administrative offices and 25,000 sq. 
ft. of manufacturing space. The facility is constructed of masonry and steel 
and is equipped with a one-half ton chain hoist, overhead sprinkler system, 
and two loading docks. The Ravenna facility will be utilized for tire 
production and management of the Company believes that the Ravenna facility 
will be sufficient to handle projected  production needs for the next five 
years.  It is the opinion of management that the Company maintains adequate 
insurance coverage for loss or damage to its facility under its existing 
insurance policy.PAGE
<PAGE> 27

MANAGEMENT

Directors and Executive Officers

     The following table sets forth as of March 31, 1997, the name, age, and 
position of each executive officer and director and the term of office of each 
Director of the Company.

   Name            Age  Position                    Director or Officer Since
   ----            ---  --------                    -------------------------

Richard Steinke    54   Chairman, Director,
                         and C.E.O.                 January 1995

Dennis S. Chrobak  57   President and Director      January 1995

Roger A. Fleming   56   Vice-President, Technology  January 1997

Hugh Sims-Hilditch 58   V.P., European Operations
                         and Director               February 1997

Ping Zhang         31   V.P., China Operations
                         and Director               February 1997

David K. Griffiths 59   Treasurer                   February 1995

Marcy L. Janus     29   Secretary                   March 1997


     The term of office of each Director is one year and until his successor 
is elected and qualified at the Company's annual meeting, subject to removal 
by the Shareholders.  The term of office for each Officer is one year and 
until a successor is elected at the annual meeting of the Board of Directors 
and is qualified, subject to removal by the Board of Directors.  The Company 
will reimburse Directors for their expenses associated with attending 
Directors' meetings.  However, Directors have not, nor is it anticipated they 
will, receive any additional compensation for attending Directors' meetings.

Biographical Information

     Set forth below is certain biographical information for each of the 
Company's Officers and Directors and other key personnel.

     Richard Steinke is a founder of the Company and currently serves as its 
Chairman and Chief Executive Officer.  From January 1992 to December 1994, Mr 
Steinke served as Chairman and C.E.O. of Alanco Environmental Resources, Inc. 
[NASDAQ: ALAN], a manufacturer of environmental/pollution control equipment, 
Salt Lake City, Utah.  From June 1985 to December 1991, he was the Chairman 
and C.E.O. of UTI Chemicals, Inc.[NASDAQ: UTEC],  a developer and manufacturer 
of urethane chemicals, El Toro, California.  Mr. Steinke brings to the Company 
several years of top level management experience in public companies involved 
in the use of emerging technologies.  Mr. Steinke received a B.A. in Political 
Science and Economics from the University of Arizona, Tucson, Arizona, in 
1967.
PAGE
<PAGE> 28

     Dennis S. Chrobak is a founder of the Company and currently serves as its 
President and is a Director.  From January to December 1994, Mr. Chrobak was 
self-employed as an engineer/consultant.  Prior to his retirement in 1994, Mr. 
Chrobak was employed by Goodyear Tire and Rubber Company, Akron, Ohio, for 33 
years.  During that time, Mr. Chrobak served in various employment capacities, 
including Staff Engineer, 1962; Senior Project Engineer, 1963-1968; Section 
Leader, Military Aircraft Tire Engineering, 1968-1970; Chief Engineer, Race 
Tire Engineering, 1970-1974; General Manager, International Race Tyre
Division, UK, 1974-1979; Product Manager, New Passenger Tire Products, 1981 to 
1983; Chief Engineer; Tire/Wheel Systems Engineering, 1983-1985; Chief
Engineer, Technology Forecasting, Planning, and Business Coordination, 1985
to 1987; and Chief Engineer, Specialty Tire Programs, 1987 to 1994.  Mr. 
Chrobak received a B.S. in Chemical Engineering, Case Institute of Technology, 
Cleveland, Ohio, in 1961, and MBA (then Case-Western) in 1989.  In addition, 
Mr. Chrobak has received several certifications relating to additional 
education and training in the chemical/tire industry.  Mr. Chrobak is the 
inventor of 9 patents relating to tire technology and has published several 
papers relating to issues in the tire industry.  Mr. Chrobak is active in his 
church and community, including 40 years devoted to various positions in the 
Boy Scouts. 

     Roger A. Fleming, joined the Company in February 1997 as its 
Vice-President of Technology.  Prior to joining the Company Mr. Fleming was a 
senior engineer at Goodyear Tire & Rubber Company, Akron, Ohio, were Mr. 
Fleming had worker for over 31 years.  Mr. Fleming holds many patents in 
product and process design and has managed the development of Goodyear's 
liquid phase united spare tire. Mr. Fleming received a degree in Chemical 
Engineering from North Carolina State University, Raleigh, North Caroline in 
1963.

     Hugh-Sims Hilditch joined the Company as its Vice-President of European 
Operations and a Director in February 1997 in connection with the Company's 
acquisition of UTI-UK.  Mr. Sims-Hilditch has in excess of the past five years 
served as the Manager of UTI-UK, Hilmarton, England, a distributor of urethane 
products in the United Kingdom and Europe.

     Ping Zhang was named the Company's Vice-President of China operations and 
a director in February 1997.  Mr. Zhang has for the past three years been 
actively involved in promoting U.S.- China business and trade relationships.  
Mr. Zhang received a Masters Degree in Manufacturing and Industrial Technology 
from Arizona State University, Tempe, Arizona, in 1993, and a degree in 
Mechanical Engineering from Shanghai Jiatong University, Shanghai, China, in 
1991.

     David K. Griffiths currently serves as the Company's Treasurer and 
principal accounting officer and has since 1960 been self-employed as an 
accountant/consultant for various small businesses.  Mr. Griffiths offers the 
Company 36 years experience in accounting and accounting related systems.

     Marcy L. Janus currently serves as the Company's Secretary.  In December 
1989, Marcy received a B.A. in Communications from Kent State University, 
Kent, Ohio.  Ms. Janis brings to the Company seven years experience in 
executive office management and computer services.
PAGE
<PAGE> 29

KEY EMPLOYEES

     Shanley Brown joined the Company in January 1997 and serves as the 
Company's domestic sales manager.  Mr. Brown brings to the Company over 20 
years of experience in both domestic and international sales for bicycles and 
light duty pneumatic tires.  From 1994 to 1996, Mr. Brown, was Vice President 
of the Industrial Tire Division of Shinko USA, Carson City, California, a 
division of Shin Hung Co., Ltd., Osaka, Japan.  From 1991 to 1994, he was the 
National Sales Manager for Kenda Tire USA, Columbus, Ohio.  From 1984 to 1991, 
Mr. Brown was the Midwest Regional Manager for Greenball Corporation, Long 
Beach, California, a distributor of products for Cheng Shin Rubber, Taipei, 
Taiwan and from 1976 to 1984, Mr. Brown was the District Manager for Carlisle 
Tire and Rubber, Carlisle, Pennsylvania.  Mr. Brown received an Associate 
degree in Business Administration at Ohio University at Lancaster, Ohio in 
1970.

     Derek A. Bowers, joined the Company in June 1995.  From May 1994 to June 
1995, Mr. Bowers was employed by Huffy Bicycle Company, Celina, Ohio, as an 
engineer.  Mr. Bowers received a M.S. in Mechanical Engineering from Carnegie 
Mellon University, Pittsburgh, Pennsylvania, in May 1994 and a B.S. in 
Mechnical Engineering from Old Dominion University, Norfolk, Virginia, in May 
1993.


COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

     The Company is not subject to the requirements of Section 16(a) of the 
Exchange Act.
PAGE
<PAGE> 30

EXECUTIVE COMPENSATION

     The following tables set forth certain summary information concerning the 
compensation paid or accrued for each of the Company's last two completed 
fiscal years to the Company's or its principal subsidiaries chief executive 
officer and each of its other executive officers that received compensation in 
excess of $100,000 during such period (as determined at June 30, 1996, the end 
of the Company's last completed fiscal year):

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
 
                                                       Long Term Compensation
                                                       ----------------------

                     Annual Compensation               Awards       Payouts
                                           Other      Restricted
Name and                                   Annual      Stock     Options 
LTIP     All other
Principal Position Year  Salary  Bonus($) Compensation Awards   /SARs   
Payout  Compensation
------------------ ----  ------  -------- ------------ ------   ------- 
------  ------------
<S>              <C>     <C>    <C>      <C>          <C>      <C>     <C>     
<C>
Richard A. Steinke  1996   $-0-     -0-       -0-         -0-      -0-     
-0-       -0-
C.E.O. and Chairman 1995    -0-     -0-       -0-         -0-      -0-     
-0-       -0-


</TABLE>

Employment Agreements and Benefits

      The Company has entered into Employment Agreements with Richard A. 
Steinke, its Chief Executive Officer, and Dennis S. Chrobak, its President.  
Beginning October 1, 1996, the Employment Agreements call for Mr. Steinke and 
Mr. Chrobak to be employed for a term of 36 months, with monthly compensation 
of $10,000, each, subject to increase at the discretion of the Board of 
Directors.  The Company is to provide group health, medical, and life 
insurance, similar to that which will be made available to all full time 
employees and reimburse Messrs. Steinke and Chrobak for out-of-pocket expenses 
incurred in connection with the Company's business.  In the event of 
termination of either Mr. Steinke's or Mr. Chrobak's employment, for reasons 
other than cause, as defined in each employment agreement, the terminated 
parties monthly salary would continue throughout the balance of the term of 
the employment agreement.   The Company does not have employment agreements 
with any other officer and director or other key personnel. 

     At the request of Dennis Chrobak, the Company's President, the Company 
has accrued his monthly employment compensation for October, November and 
December 1996.  Mr. Chrobak has requested the Company to continue to accrue 
his monthly employment compensation until further notice.  In January 1997, 
the Company deposited $30,000 into a separate account  and will continue to 
deposit Mr. Chrobak's accrued employment compensation into this account until 
such time as the Company receives notice from Mr. Chrobak that he desires to 
receive it.
PAGE
<PAGE> 31

     As a condition to employment, all the Company's managers and key 
personnel are required to sign a nondisclosure and noncompetition agreement.  
Under the terms of the nondisclosure and noncompetition agreement, employees 
will not be able to provide services or information deemed confidential by the 
Company to any other company or person which directly or indirectly competes 
with the Company in the tire industry or an industry which at the time of the 
employees' employment, the Company intended to enter.  There is no time 
limitation on the nondisclosure aspect of the agreement.  The noncompetition 
clause is for a period of two years and prevents a former employee or 
consultant of the Company from acting as an employee, consultant or in any 
other capacity for a competitor of the Company.  Additionally, all employees 
will be required, as a condition of their employment, to enter into a 
nondisclosure agreement related to any information or process deemed 
confidential by the Company.

Consulting Agreement with Vincent Panaroni

     In August 1995, the Company entered into a consulting agreement with 
Vincent Panaroni, wherein Mr. Panaroni has agreed to provide the Company with 
technical advice relating to chemical formulations and the development of 
polyurethane compounds for use in products manufactured or licensed by the 
Company for manufacture by third parties.  The term of the Company's 
consulting arrangement with Mr. Panaroni is one year, subject to renewals for 
like periods, and provides for monthly payments of $3,000.  The consulting 
agreement restricts Mr. Panaroni from  disclosing to third parties proprietary 
information regarding the Company's products and keeping confidential 
information and knowledge gained as a result of the services provided. This 
Agreement was terminated at July 31, 1996 and the Company and Mr. Panaroni 
have agreed to utilize Mr. Panaroni's services on an ad hoc basis with Mr. 
Panaroni's compensation to be determined on a project by project basis.

Pension Table


     None.

Compensation of Directors

     None.


Termination of Employment and Change of Control Arrangement

     Unless otherwise disclosed above, there are no compensatory plans or 
arrangements, including payments to be received from the Company, with respect 
to any person named in Cash Compensation set out above which would in any
way result in payments to any such person because of his resignation, 
retirement, or other termination of such person's employment with the Company 
or its subsidiaries, or any change in control of the Company, or a change in 
the person's responsibilities following a changing in control of the Company.

PAGE
<PAGE> 32

PRINCIPAL SHAREHOLDERS

     The following table sets forth as of March 31, 1997, the name and the 
number of shares of the Company's Common Stock, par value $0.001 per share, 
held of record or beneficially by each person who held of record, or was known 
by the Company to own beneficially, more than 5% of the 4,546,748 issued and 
outstanding shares of the Company's Common Stock, and the name and 
shareholdings of each director and of all officers and directors as a group.

Security Ownership of Certain Beneficial Owners

Title  
 of      Name and Address              Amount and Nature of     Percentage 
Class    Beneficial Owner              Beneficial Ownership(1)   of Class
-----    ----------------              --------------------     ----------
Common   Dennis S. Chrobak             D     1,255,000             27.6
         2914 Silver Lake Blvd.        I (2)    50,000              1.1
         Silver Lake, OH 44224   

Common   Richard A. Steinke            I (3)   455,000             10.0
         446 West Lake Street          I (4)   800,000             17.6
         Ravenna, OH  44266

Security Ownership of Management of the Company 

Title  
 of      Name and Position of          Amount and Nature of     Percentage 
Class    Officer and/or Director       Beneficial Ownership(1)   of Class
-----    -----------------------       --------------------     ----------
Common   Dennis S. Chrobak, President        ---See Table Above---
         and Director

Common   Richard A. Steinke, C.E.O.          ---See Table Above---
         and Director

Common   Hugh Sims-Hilditch, Director  I (5)   245,000              5.4

Common   Ping Zhang, Director          D          -                  -

         All Officers and Directors
          as a Group (7 person)        D     1,275,000             28.0
                                       I     1,550,000             34.1
                                             ---------             ----
         Total Beneficial Ownership          2,825,000             62.1
                                             =========             ====
    
(1) Indirect and Direct ownership are referenced by an "I" or "D", 
respectively.  All shares owned directly are owned beneficially and of record 
and such shareholder has sole voting, investment, and dispositive power, 
unless otherwise noted.

(2) Represent shares owned beneficially and of record by Bonnie Chrobak, the 
wife of Dennis S. Chrobak, and which Mr. Chrobak may be deemed to have 
indirect beneficial ownership over such shares.

(3) Represent shares owned beneficially and of record by Gemini Funding 
Services Profit Sharing Account, of which Richard A. Steinke is the principal 
beneficiary.
[Footnotes continue on next page]
<PAGE> 33

(4) Represent shares owned beneficially and of record by S102 Irrevocable 
Trust, for which Richard A. Steinke is the trustee.

(5) Represent shares owned beneficially and of record by Coronel Investments 
Limited, a Jersey Corporation, of which Mr. Sims-Hilditch is the principal 
owner.

CERTAIN TRANSACTIONS

Technology License Agreements

     DSS License Agreement

     On June 5, 1995, the Company entered into a technology license agreement 
(the "DSS License Agreement") with AMS, an entity controlled by Dennis S. 
Chrobak and Richard A. Steinke, affiliates of the Company.  AMS is the owner 
of certain technology known as the "Dynamic Steerable Spring" ("DSS") for 
which an application for United States Letters Patent has been filed and is 
currently pending. The License Agreement grants the Company an exclusive to 
use, sell, license, or otherwise exploit the DSS Technology worldwide in 
exchange for a royalty of either $1.00 for each unit of production produced 
and sold by the Company or eight percent (8%) of any royalty the Company 
should receive from third party licensees that utilize the DSS Technology.  
Due to the relationship of Mr. Steinke and Mr. Chrobak with the Company, the 
DSS License Agreement cannot be considered to have been negotiated at arm's 
length.

     Airless Tire License Agreement

     On October 27, 1995, the Company entered into a technology license 
agreement (the "Airless Tire License Agreement") with AMS.  AMS is the owner 
of certain technology for producing an airless tire for which an application 
for United States Letters Patent has been filed and is currently pending.   
The Airless Tire License Agreement grants the Company an exclusive license to 
use, sell, license, or otherwise exploit the technology worldwide in exchange 
for a royalty of $0.25 for each bicycle tire produced and sold by the Company 
utilizing the technology.  Due to the relationship of Mr. Steinke and Mr. 
Chrobak with the Company, the Airless Tire License Agreement cannot be 
considered to have been negotiated at arm's length.

     Stock Subscriptions

     In April 1995, the Company entered into subscription agreements with Gary 
Dalton, Philip Chrobak, and David Griffiths, three of its Officers, to acquire 
an aggregate of 170,000 shares of its Common Stock at a purchase price of 
$1.00 per share, in exchange for promissory notes bearing interest at 8% per 
annum, payable in 36 months.  The promissory notes were subsequently amended 
to become due on April 10, 1997. The Company has adopted a policy that any 
future loans or similar arrangements to its officers, directors, or 5% 
shareholders will not occur unless approved by a majority of the disinterested 
directors and for a bona fide business purpose.  Set forth below are the names 
of the Officers, the number of shares issued, the consideration to be received 
for such shares, and their relationship with the Company.
PAGE
<PAGE> 34


                        Number of      Consideration  Balance   Relationship
Name of Shareholder     Shares Issued  to be Paid     Due (3)   to the Company
-------------------     -------------  -------------  -------   --------------

Gary Dalton (1)            100,000       $100,000     $40,000   Former Officer
Philip J. Chrobak (2)       50,000         50,000      45,000   Former Officer
David Griffiths             20,000         20,000       -0-     Officer
                           -------       --------     -------
Totals                     170,000       $170,000     $85,000
                           =======       ========     =======

(1)  As of March 31, 1997, Mr. Dalton had paid $50,000 cash and provided 
services to the Company valued at $10,000, which amounts have been applied 
against the principal and interest to be paid under the promissory note.

(2)  As of March 31, 1997, Mr. Chrobak has provided services to the Company 
valued at $5,000, which amount has been applied against the principal and 
interest to be paid under the promissory note.

(3)  Amount due does not include any accrued interest.


DESCRIPTION OF CAPITAL STOCK

Common Stock

     The Company's Articles of Incorporation authorize 25,000,000 shares of 
Common Stock, $0.001 par value per share.  The shares of Common Stock have no 
preemptive or other subscription rights, have no conversion rights, and are 
not subject to redemption.  All shares of Common Stock will be, when and if 
issued, fully paid and nonassessable.  No personal liability will attach to 
the ownership thereof.  The holders of Common Stock are entitled to one vote 
for each share held.  The Common Stock has noncumulative voting rights.

Preferred Stock

     The Company's Articles of Incorporation authorize 5,000,000 shares of 
Preferred Stock, $0.001 par value per share (the "Preferred Stock").  The 
authority to issue the Preferred Stock is vested in the Board of Directors, 
which has authority to fix and determine the powers, qualifications, 
limitations, restrictions, designations, rights, preferences, or other 
variations of each class or series within each class which the Company is 
authorized to issue.  The above described authority of the Board of Directors 
to fix and determine may be exercised by corporate resolution from time to 
time as the Board of Directors sees fit.

Shares Eligible for Future Sale

     The Company has 4,546,748 shares of Common Stock issued and outstanding.  
All of the 155,000 shares of Common Stock registered to be sold by Selling 
Shareholders will be freely transferable by persons other than "affiliates" of 
the Company, as that term is defined under the Securities Act, without further 
registration under the Securities Act.
PAGE
<PAGE> 35

     The Company has previously issued shares of Common Stock that constitute 
"restricted securities" as that term is defined in Rule 144 adopted under the 
Securities Act.  Subject to certain restrictions, such securities may 
generally be sold in limited amounts two years after their acquisition.     
The Commission has recently adopted a proposal to reduce the holding period 
prior to which shares may be eligible for resale under Rule 144 from two years 
to one year.  The amendments to Rule 144 take effect April 29, 1997 and once 
effective, the rule will allow the above mentioned restricted securities to be 
eligible for resale one year earlier. 

     The Company issued 2,510,000 shares of Common Stock to initial 
Shareholders in connection with its organization.  The Company issued an 
additional 300,000 shares of Common Stock to various individuals for professiona
l and consulting services during February 1995.  In April 1995, the Company 
issued 170,000 shares to certain Officers and 100,000 shares for professional 
services.  In May 1995, the Company issued 720,000 shares in a private 
placement.  The shares issued to insiders (2,510,000 shares to founders and 
170,000 shares to other Officers) are currently eligible for resale under Rule 
144.  However, in connection with the Company's initial public offering, the 
Company's Officers, Directors, and Shareholders owning more than 5% of the 
Company's issued and outstanding shares of Common Stock agreed not to sell any 
shares owned directly or indirectly by them for a period of up to four years, 
subject to the Company obtaining certain net earnings requirements.

     The 400,000 shares of Common Stock issued to consultants for professional 
services in February and April 1995 were issued pursuant to an exemption from 
registration available under Rule 701 of the Securities Act, and are now 
eligible for resale pursuant to the resale limitations set forth in Rule 
701(c) which provides that 90 days after the Company becomes subject to the 
reporting requirements of Section 13 or Section 15(d) of the Securities 
Exchange Act of 1934 (i.e., May 28, 1996), securities issued in a Rule 701 
transaction may be resold by persons other than affiliates in reliance on Rule 
144, without compliance with (1) current information, (2) holding period, (3) 
volume limitation, and (4) notice requirements of Rule 144; and by affiliates 
without compliance with the holding period requirements of Rule 144.

     The 720,000 shares of restricted Common Stock sold by the Company in the 
May 1995 will become eligible for sale under Rule 144 in May 1997. Sales of 
these restricted securities under Rule 144 or otherwise may have a depressive 
effect on the price of the Company's Common Stock in any trading market that 
may develop following this Offering.  After the implementation of the 
amendment to Rule 144, securities held for two years may be sold by 
nonaffiliates without limitation.  See PRINCIPAL SHAREHOLDERS and DESCRIPTION 
OF CAPITAL STOCK. 

     The Company is unable to estimate the total number of shares that may be 
sold in the future by its existing Shareholders or the effect, if any, that 
sales of shares by such Shareholders will have on the market price of the 
Common Stock prevailing from time to time.  Sales of substantial amounts of 
Common Stock by existing Shareholders could adversely affect prevailing market 
prices.

PAGE
<PAGE> 36 

Dividend Policy

     The holders of Common Stock are entitled to dividends when, and if, 
declared by the Board of Directors from funds legally available therefor, 
subject to any preference on preferred stock, if applicable, which may then be 
outstanding.  The Company has not paid a dividend since its incorporation.  
Because the Company is in the formative stage and will be engaged in start-up 
operations for the next several years, it is not anticipated that funds will 
be available for the issuance of dividends in the foreseeable future.

Transfer and Warrant Agent

     The Company's transfer agent is Interwest Transfer Company, 1981 East 
Murray-Holladay Road, Holladay, Utah  84117, Telephone (801) 272-9294.

LITIGATION

     The Company is not a party to any pending legal proceedings and no such 
action by or against it, to the best of its knowledge, has been threatened.


LEGAL MATTERS

     Taylor and Associates, Inc., Attorneys and Counselors at Law, Salt Lake 
City, Utah,  counsel to the Company, will render an opinion that the Common 
Stock being offered hereby, has been fully paid and nonassessable under the 
corporate laws of the state of Nevada.

EXPERTS

     The financial statements included herein and elsewhere in this 
Registration Statement, to the extent and for the periods indicated in its 
report, have been included in this Prospectus and the Registration Statement, 
in reliance on the report of Saltz, Shamis & Goldfarb, Inc., Certified Public 
Accountants, Akron, Ohio, given on the authority of said firm as experts in 
accounting and auditing.

ADDITIONAL INFORMATION

     The Company has filed this Registration Statement on Form S-1 under the 
Securities Act with the Commission with respect to the securities offered by 
this Prospectus.  This Prospectus omits certain information contained in the 
Registration Statement.  For further information, reference is made to the 
Registration Statement and to the exhibits and other schedules filed 
therewith.  Statements contained in this Prospectus as to the contents of any 
contract or other document referred to are not necessarily complete, and where 
such contract or document is an exhibit to the Registration Statement, each 
such statement is deemed to be qualified and amplified in all respects by the 
provisions of the exhibit.  Copies of the complete Registration Statement, 
including exhibits, may be examined without charge at the Commission's 
principal offices in Washington, D.C., and copies of all or any part of the 
filed materials may be obtained from the Public Reference Section of the 
Commission, at 450 Fifth Street, N.W., Washington, D.C.  20549, on payment the 
ususal fees for reproduction.

PAGE
<PAGE> 37

FINANCIAL STATEMENTS

INDEX TO FINANCIAL STATEMENTS

Title to Document                                                         Page
-----------------                                                         ----

Independent Auditor's Report of Saltz, Shamis & Goldfarb, Inc.             38

Balance Sheets as of June 30, 1996 and 1995                                39

Statements of Operations for the year ended June 30, 1996 and
the period from January 30, 1995 (inception) to June 30, 1996
and 1995                                                                   41

Statements of Shareholders' Equity for the year ended June 30,
1996 and the period from January 30, 1995 (inception) to June
30, 1996 and 1995                                                          42

Statements of Cash Flows for the year ended June 30, 1996 and
for the period from January 30, 1995 (inception) to June 30,
1996 and 1995                                                              43

Notes to Financial Statements                                              44

                                            
Balance Sheet at June 30, 1996 and December 31, 1996 (Unaudited)           50

Statements of Operations for the three months ended December
 31, 1996 and 1995, for the six months ended December 31, 1996
 and 1995 and from January 30, 1995 (Inception) to December 31,
 1996 (Unaudited)                                                          52

Statements of Shareholders' Equity for the Period from January 30,
 1995 (Inception) to December 31, 1996 (Unaudited)                         53

Statements of Cash Flows for the three months ended December 31,
 1996 and 1995, for the six months ended December 31, 1996 and
 1995 and from January 30, 1995 (Inception) to December 31, 1996
 (Unaudited)                                                               54

Notes to the Financial Statements                                          55







PAGE
<PAGE> 38

INDEPENDENT AUDITOR'S REPORT

To the Shareholders and Board of Directors
of American Tire Corporation

We have audited the accompanying balance sheets of American Tire Corporation 
(a development stage company) as of June 30, 1996 and 1995, and the related 
statements of operations, shareholders' equity, and cash flows for the year 
ended June 30, 1996 and for the period from January 30, 1995 (inception) to 
June 30, 1996 and 1995.  These financial statements are the responsibility of 
the Company's management.  Our responsibility is to express an opinion on 
these financial statements based on our audit.

We conducted our audits in accordance with generally accepted auditing 
standards.  Those standards require that we plan and perform the audits to 
obtain reasonable assurance about whether the financial statements are free of 
material misstatement.  An audit includes examining, on a test basis, evidence 
supporting the amounts and disclosures in the financial statements.  An audit 
also includes assessing the accounting principles used and significant 
estimates made by management, as well as evaluating the overall financial 
statement presentation.  We believe that our audits provide a reasonable basis 
for our opinion.

In our opinion, the financial statements referred to above present fairly, in 
all material respects, the financial position of American Tire Corporation as 
of June 30, 1996 and 1995, and the results of its operations and its cash 
flows for the year ended June 30, 1996 and for the period from January 30, 
1995 (inception) to June 30, 1996 and 1995, in conformity with generally 
accepted accounting principles.

The accompanying financial statements have been prepared assuming the company 
will continue as a going concern.  As described in Note A to the financial 
statements, the Company's ability to bring its product to market are dependent 
on its successful obtainment of capital to fund its activities.  In the event 
the Company is unsuccessful in obtaining sufficient capital, there is 
substantial doubt about the Company's ability to continue as a going concern.  
The financial statements do not include any adjustments that might result from 
the outcome of this uncertainty.


/S/ SALTZ, SHAMIS & GOLDFARB, INC.

Akron, Ohio
October 9, 1996














<PAGE> 39

AMERICAN TIRE CORPORATION
(A Development Stage Company)
<TABLE>
<CAPTION>BALANCE SHEETS
JUNE 30, 1996 AND 1995
ASSETS
                                             1996        
1995                                                            ---------    
--------- 
<S>                                   <C>          <C> 
CURRENT ASSETS:
 Cash                                   $    4,467   $   92,729
 Other receivables                          22,767        4,419
 Receivable - officers                        -          50,000
 Inventory                                 131,285         -
 Prepaid royalties - related party          17,725        8,550
 Prepaid expenses                           15,182       19,563
 Deposits on inventory                      87,401      201,838
                                         ---------    ---------
 Total Current Assets                      278,827      377,099
                                         ---------    ---------
PROPERTY, PLANT AND EQUIPMENT
 Land                                       59,000       59,000
 Building and building improvements        229,996      228,305
 Equipment                                 225,968       73,906
 Furniture and fixtures                      7,692        6,940
 Construction in progress                     -          14,000
                                         ---------    ---------
                                           522,656      382,151
  Less: accumulated depreciation            39,299        1,305
                                         ---------    ---------
                                           483,357      380,846
OTHER ASSETS:
 Deposits                                    1,834        1,854
 Accrued interest receivable                 9,993        2,991
 Deferred offering costs                   147,108       71,824
                                         ---------    ---------
                                           158,935       76,669 
                                         ---------    ---------
                                        $  921,119   $  834,614
                                         =========    =========


</TABLE>














(See accompanying notes to the financial statements)
<PAGE> 40
AMERICAN TIRE CORPORATION
(A Development Stage Company)
<TABLE>
<CAPTION>BALANCE SHEETS
JUNE 30, 1996 AND 1995
LIABILITIES AND SHAREHOLDERS' EQUITY

                                             1996        
1995                                                            ---------    
--------- 
<S>                                   <C>          <C>
CURRENT LIABILITIES:
 Line of credit                         $   299,838  $  201,838
 Accounts payable and accrued expenses       98,680      24,908
 Due to officer                                -          6,159
 Notes payable - officers and
  accrued interest                          265,830        -
                                         ----------   ---------
 Total Current Liabilities                  664,348     232,905

SHAREHOLDERS' EQUITY:
 Preferred stock, par value $0.001,
  5,000,000 shares authorized,
  0 shares issued and outstanding              -           -
 Common stock $.001 par value, 25,000,000 
  shares authorized, 3,840,642 and 
  3,800,000 shares issued and outstanding,
  respectively                                3,841       3,800
 Additional paid-in capital               1,182,650     940,439
 Deficit accumulated during the 
  development stage                        (844,720)   (248,630)
                                          ---------   ---------  
                                            341,771     695,609
 Less: Receivable - shareholder (officers)  (85,000)    (93,900)
                                          ---------   ---------
                                            256,771     601,709
                                          ---------   ---------
                      
                                        $   921,119  $  834,614
                                         ==========   =========
</TABLE>


















(See accompanying notes to the financial statements)
<PAGE> 41

AMERICAN TIRE CORPORATION 
(A Development Stage Company)

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>                                                                       
   January 30, 1995
                                                         For the    January 
30, 1995  (Inception)   
                                                       Year Ended     
(Inception)          to
                                                        June 30,     to June 
30,        June 30, 
                                                           1996           
1995             1996      
                                                      ------------   
------------    ------------
<S>                                                   <C>            
<C>             <C>
INCOME
 Interest income                                      $      8,161   $      
3,611    $     11,772
                                                      ------------   
------------    ------------
EXPENSES:
 Consulting                                                 43,261        
135,818         179,079
 Payroll and payroll taxes                                 222,757         
29,817         252,574
 Administrative                                            190,864         
28,126         218,990
 Travel and entertainment                                   55,554         
40,774          96,328
 Marketing consulting                                         -            
13,300          13,300
 Interest                                                   53,821          
3,101          56,922
 Depreciation                                               37,994          
1,305          39,299 
                                                      ------------   
------------    ------------
    Total Expenses                                         604,251        
252,241         856,492
                                                      ------------   
------------    ------------
LOSS BEFORE INCOME TAXES                                  (596,090)      
(248,630)       (844,720)

 Income taxes                                                 -              
-              -     
                                                      ------------   
------------    ------------
NET LOSS                                              $   (596,090)  $   
(248,630)   $   (844,720)
                                                      ============   
============    ============

WEIGHTED AVERAGE SHARES OUTSTANDING                      3,840,642      
3,800,000       3,840,642
                                                      ============   
============    ============

NET LOSS PER SHARE                                    $      (0.16)  $      
(0.06)   $      (0.22)
                                                      ============     
==========    ============
</TABLE>




















(See accompanying notes to the financial statements)

<PAGE> 42
AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENT OF SHAREHOLDERS' EQUITY
FROM THE DATE OF INCEPTION (JANUARY 30, 1995) TO JUNE 30, 1996
<TABLE>
<CAPTION>                                                   Accumulated
                                                            Deficit    
                                                 Additional During         
Notes         Total
                              Common Stock        Paid-in   Development   
Receivable   Shareholders'
                            Shares      Amount    Capital   Stage        
Shareholders    Equity
                          ----------  ---------  ---------  -----------  
------------  -------------
<S>                      <C>        <C>        <C>        <C>          
<C>           <C>

BALANCE, January 30, 1995
 (Inception)                    -     $    -     $     -     $     -     
$       -     $       -

Sale of common stock for
 cash of $.01 per share    2,510,000      2,510        -           
-             -            2,510

Common stock issued for
 services in February
 1995                        300,000        300      29,700        
-             -           30,000

Common stock issued for
 services in April 1995      100,000        100      99,900        
-             -          100,000

Common stock issued for
 notes receivable, of 
 which $50,000 was paid
 in August 1995 and
 $50,000 included in
 current assets at June
 30, 1995                    170,000        170     169,830        -         
(120,000)       50,000

Repayment of notes
 receivable by providing
 services                       -          -           -           -           
26,100        26,100

Sale of common stock for
 cash of $1.00 per share
 pursuant to a private
 placement, net of stock
 issuance costs of $78,271   720,000        720     641,009        
-             -          641,729

Net loss for the period         -          -           -       
(248,630)         -         (248,630)
                          ----------  ---------  ----------  ----------  
------------  ------------ 
Balance at June 30, 1995   3,800,000      3,800     940,439    (248,630)      
(93,900)      601,709

Repayment of notes
 receivable by providing
 services                       -          -           -           
-            8,900         8,900

Sale of common stock for
 cash of $6.00 per share
 pursuant to a private
 placement                    40,642         41     243,811        
-            -           243,852

Stock issuance costs            -          -         (1,600)       
-            -            (1,600)

Net loss for the year           -          -           -       
(596,090)        -          (596,090)
                          ----------  ---------  ---------- -----------  
-----------   ------------ 
Balance at June 30, 1996   3,840,642  $   3,841  $1,182,650 $  (844,720) $   
(85,000)  $    256,771
                          ==========  =========  ========== ===========  
===========   ============
</TABLE>
(See accompanying notes to the financial statements)
<PAGE> 43
AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                                
   January 30, 1995
                                                         For the   January 30, 
1995  (Inception)   
                                                       Year Ended     
(Inception)          to  
                                                        June 30,     to June 
30,        June 30,
                                                          1996           
1995             1996     
                                                      ------------   
------------    ------------
<S>                                                   <C>            
<C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net loss                                             $   (596,090)  $   
(248,630)   $   (844,720)

 Adjustments to reconcile net loss to net cash
  used by operating activities:
    Depreciation                                            37,994          
1,305          39,299
    Stock issued in lieu of cash payment for
     certain services                                         -           
129,000         129,000
    Services provided in lieu of cash payment
     on receivables - officers                               8,900         
26,100          35,000
  (Increase) decrease in:
     Other receivables                                     (18,348)        
(4,419)        (22,767)
     Inventory                                            (131,285)          
-           (131,285)
     Prepaid royalties                                      (9,175)        
(8,550)        (17,725)
     Prepaid expenses                                        4,381        
(19,563)        (15,182)
     Deposits on inventory and other                       114,457       
(203,692)        (89,235)
     Accrued interest receivable                            (7,002)        
(2,991)         (9,993)
  Increase (decrease) in:
     Accounts payable and accrued expenses                  78,602         
24,908         103,510
     Due to officer                                         (6,159)         
6,159            -  
                                                      ------------   
------------    ------------
NET CASH USED BY OPERATING ACTIVITIES                     (523,725)      
(300,373)       (824,098)

CASH FLOWS FROM (USED) IN INVESTING ACTIVITIES:
     Purchase of property, plant and equipment            (140,505)      
(382,151)       (522,656)
                                                      ------------   
------------    ------------
NET CASH USED BY INVESTING ACTIVITIES                     (140,505)      
(382,151)       (522,656)

CASH FLOWS FROM FINANCING ACTIVITIES:
     Borrowing on line of credit                           196,000        
201,838         397,838
     Repayment on line of credit                           (98,000)          
-            (98,000)
     Proceeds from notes payable - officers                267,000           
-            267,000
     Repayment of notes payable - officers                  (6,000)          
-             (6,000)
     Proceeds from mortgage note payable                      -           
188,000         188,000
     Repayment of mortgage note payable                       -          
(188,000)       (188,000)
     Proceeds from issuance of common stock
      (net of stock issuance costs of $79,871)             292,252        
644,239         936,491
     Deferred offering costs                               (75,284)       
(70,824)       (146,108)
                                                      ------------   
------------    ------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                  575,968        
775,253       1,351,221
                                                      ------------   
------------    ------------
NET INCREASE (DECREASE) IN CASH                            (88,262)        
92,729           4,467

CASH AT BEGINNING OF PERIOD                                 92,729           
-               -   
                                                      ------------     
----------    ------------
CASH AT END OF PERIOD                                 $      4,467     $   
92,729    $      4,467
                                                      ============     
==========    ============
</TABLE>



(See accompanying notes to the financial statements)
<PAGE> 44
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------- 

NATURE OF BUSINESS: American Tire Corporation, a Nevada corporation ("the 
Company"), was organized on January 30, 1995, to take advantage of existing 
proprietary and non-proprietary technology available for the manufacturing of 
specialty tires.  The Company has had limited operations since its 
organization and is a "development stage" company.  The Company intends to 
engage in the manufacturing, marketing, distribution, and sales of airless 
"specialty" tires and tire-wheel assemblies utilizing "liquid phase" 
technology.  Initially, the Company will manufacture airless bicycle tires at 
the Company manufacturing facility located in Ravenna, Ohio.  The Company's 
year end is June 30.

BASIS OF PRESENTATION:  The accompanying financial statements have been 
prepared on a going concern basis, which contemplates the realization of 
assets and the satisfaction of liabilities in the normal course of business.  
The Company has a very limited operating history, has not generated operating 
revenues to date and must be considered promotional and in its early 
development stages.

Through an initial public offering the Company is offering at a cash price of 
$6.00 per share, up to 550,000 shares (250,000 share minimum) of the Company's 
common stock.  The Company's continuation as a going concern is dependent upon 
its ability to generate sufficient capital resources from its initial public 
offering or other sources to carry out its business plan and to commence and 
continue operations.

REVENUE RECOGNITION:  The Company expects to recognize revenue upon the 
shipment of product.

INVENTORY:  Inventory is stated at the lower of cost or market, using the 
first-in, first-out method.  The inventory at June 30, 1996 consists of 
finished goods purchased for resale.

PROPERTY, PLANT AND EQUIPMENT:  Property, plant and equipment are recorded at 
cost.  Depreciation is provided using the straight-line method over the 
estimated useful lives of the assets, as follows:

          Building                    40 years
          Equipment                    5 years
          Furniture and fixtures       7 years

INCOME TAXES: Deferred tax assets and liabilities are recognized for the 
expected future tax consequences of events that have been recognized in the 
financial statements and tax returns.  The Company has provided a 100% 
valuation allowance for the benefit associated with the Company's net 
operating loss carryforward of approximately $856,000 and $246,000 at June 30, 
1996 and June 30, 1995, respectively.

DEFERRED OFFERING COSTS:  The initial public offering costs have been deferred 
pending completion of such offering at which time such costs will be netted 
against the offering proceeds received.  Should the offering be unsuccessful, 
these costs will be expensed.

<PAGE> 45
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
---------------------------------------------------------------

NET LOSS PER SHARE: The net loss per share has been computed in accordance 
with regulations of the Securities and Exchange Commission.  Accordingly, 
stock issued at prices less than the proposed offering price within one year 
of the offering have been treated as outstanding for the period presented in 
the accompanying statements of operations.

CONCENTRATIONS OF CREDIT RISK: Financial instruments that potentially subject 
the Company to concentrations of credit risk consist principally of temporary 
cash investments.  The Company places its temporary cash investments with 
financial institutions and, although at times during 1996 they had balances in 
excess of federal insurance limits, management does not feel the Company is 
exposed to substantial credit risk.

RECENT PRONOUNCEMENTS: In March 1995, the FASB issued Statement No. 121 (SFAS 
121), "Accounting for the Impairment of Long-Lived Assets and for Long-Lived 
Assets to be Disposed of." SFAS 121 becomes effective for fiscal years 
beginning after December 15, 1995 and addresses the accounting for the 
impairment of long-lived assets, certain identifiable intangibles, and 
goodwill related to those assets to be held and used for long-lived assets and 
certain identifiable intangibles to be disposed of.  The Company believes this 
pronouncement will not have a significant impact on the Company's financial 
statements. 

USE OF ESTIMATES:  Management uses estimates and assumptions in preparing 
these financial statement in accordance with generally accepted accounting 
principles.  Those estimates and assumptions affect the reported amounts of 
assets and liabilities, the disclosure of contingent assets and liabilities, 
and the reported revenues and expenses.  Actual results could vary from the 
estimates that were used.

NOTE B - RECEIVABLES - OFFICERS
-------------------------------

In April 1995, the Company entered into subscription agreements for three of 
its officers to acquire an aggregate of 170,000 shares of common stock at a 
purchase price of $1.00 per share, in exchange for promissory notes bearing 
interest at 8% per annum, principal and interest payable in April 1998.  The 
officers provided accounting and consulting services valued at $26,100 which 
have been charged to operations during the period ended June 30, 1995, and 
offset against the amount owed under the promissory notes.  At June 30, 1995, 
the total amount receivable was $143,900, of which $50,000 was classified as a 
current asset. This represents cash received after June 30, 1995, but prior to 
issuance of the financial statements, with the remaining $93,900 reflected as 
a reduction of shareholders' equity, as the receivable was not settled prior 
to the issuance of the financial statements.  At June 30, 1996 and 1995, 
accrued interest receivable on these notes amounted to $9,993 and $2,991, 
respectively.  The promissory notes were amended to become due no later than 
six months from the close of the Company's initial public offering.

During the year ended June 30, 1996, an officer provided $8,900 of accounting 
services, which were offset against the amounts owed under the promissory 
note, and another officer paid $50,000 toward his note receivable.  At June 
30, 1996, $85,000 was owed under these notes, which has been presented as a 
reduction of shareholders' equity.

<PAGE> 46
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

NOTE C - TECHNOLOGY LICENSE AGREEMENT
-------------------------------------

On June 5, 1995, the Company entered into a technology licensing agreement 
with a related company owned by certain shareholders of the Company.  This 
agreement provides the Company the exclusive license to use, sell and license 
the technology for manufacturing a wheel-tire assembly known as the "Dynamic 
Steerable Spring".  The agreement specifies that a royalty of either $1.00 per 
unit sold directly by the Company or 8% percent of any royalty the Company 
should receive from any third party licensee to be paid quarterly.  At June 
30, 1996 and June 30, 1995, $17,725 and $8,550, respectively, have been  
advanced pursuant to and in anticipation of this agreement and is recorded in 
prepaid royalties.

NOTE D - DEPOSITS ON INVENTORY
------------------------------

At June 30, 1995, the Company had deposited $201,838 for purchase of bicycle 
tires.  This amount is recorded as a deposit on the June 30, 1995 balance 
sheet.  As of June 30, 1996, inventory of $114,437 has been received.  The 
remaining tires are expected to be received upon the availability of such 
tires from the manufacturer after the completion of the initial public 
offering.  In the event the manufacturer is unable to provide the tires, the 
manufacturer will refund such deposit to the Company.

NOTE E - LINE OF CREDIT
-----------------------

The Company has entered into a line of credit agreement with a bank.  Under 
the terms of the agreement, the Company may borrow up to $300,000 at the 
interest rate of prime plus 1%.  This line is personally guaranteed either 
entirely or in part by the Chief Executive Officer and the President of the 
Company and is secured by the accounts receivable, inventory and equipment of 
the Company.  At June 30, 1996 and 1995, $299,838 and $201,838, respectively 
was outstanding under this agreement.          

The weighted average interest rate during the year ended June 30, 1996 and the 
period ended June 30, 1995 was 9.71% and 10%, respectively.

NOTE F - INCOME TAXES
---------------------

The Company's total deferred tax asset, deferred tax liability and valuation 
allowance at June 30, 1996 and 1995 is:

                                         1996                  1995
                                        --------              --------
Total deferred tax asset                $308,000              $ 78,600
Total deferred tax liability              (7,400)                 -
Valuation allowance for deferred taxes  (300,600)              (78,600)
                                        --------              --------
  Deferred taxes, net                   $   -                 $   -
                                        ========              ========   

The deferred tax asset results from net operating loss carryforwards of 
approximately $856,000 and $246,000 at June 30, 1996 and 1995, respectively,

<PAGE> 47
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

which begin to expire in 2010.  The deferred tax liability results from the 
use of accelerated methods of depreciation for tax purposes.

NOTE G - SHAREHOLDERS' EQUITY
-----------------------------

Shareholders' equity is comprised of the following at June 30, 1996 and 1995:

PREFERRED STOCK: The Company has authorized 5,000,000 shares of $.001 par 
value preferred stock.  At June 30, 1996 and 1995, no shares of preferred 
stock were issued or outstanding, respectively.

COMMON STOCK: The Company was initially capitalized by issuing 2,510,000 
shares of $.001 par value common stock in exchange for a stock subscription 
receivable in lieu of cash.  The stock subscription receivable was paid on 
June 30, 1995.

In February 1995, the Company issued 300,000 shares of $.001 par value common 
stock to certain individuals in lieu of cash payments for consulting services 
provided to the Company by such individuals valued at $30,000.  $29,000 has 
been charged to operations during the period ended June 30, 1995.  $1,000 has 
been capitalized and is included in deferred offering costs at June 30, 1996 
and 1995.

In April 1995, the Company issued 100,000 shares of $.001 par value common 
stock to the spouses of two officers of the Company in lieu of cash payment 
for consulting services provided to the Company by such individuals.  The 
Company's management has charged $100,000 to operations for the period ended 
June 30, 1995 for the services provided.

In April 1995, the Company entered into subscription agreements with three of 
its officers for them to acquire an aggregate of 170,000 shares of $.001 par 
value common stock at a purchase price of $1.00 per share, in exchange for 
promissory notes bearing interest at 8% per annum, payable in April, 1998 (See 
Note B).

In May 1995, pursuant to a private placement, the Company issued 720,000 
shares of $.001 par value common stock for $1.00 per share, which resulted in 
proceeds of $720,000.  Stock issuance costs associated with this private 
placement amounted to $79,871.

In September 1995, pursuant to a private placement, the Company issued 40,642 
shares of $.001 par value common stock for $6.00 per share, which resulted in 
proceeds of $243,852.

NOTE H - RELATED PARTY TRANSACTIONS
-----------------------------------

The land and building of the Company were acquired personally by an officer of 
the Company for $287,305.  The officer was subsequently reimbursed at his cost 
upon transfer of the title of the land and building to the Company.




<PAGE> 48
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

In August, 1995, the Company entered into employment agreements with two of 
its officers, which will not take effect until the proceeds of the initial 
public offering have been received by the Company.  The agreements are for 36 
months at a monthly compensation of $10,000 each upon the consummation of the 
proposed public offering.

In October 1995, the Company entered into an agreement with a related company 
providing for a royalty of $.25 to be paid for each tire sold by the Company 
utilizing the "airless tire technology" as defined by the agreement.

From February 1996 to June 1996, certain officers loaned the Company a total 
of $261,000.  These notes are due on demand and bear interest at rates ranging 
from 9.25% to 9.5% per annum.  At June 30, 1996, accrued interest amounted to 
$4,830 and is included with the notes payable - officers on the balance 
sheet.  The Company intends to repay a portion, if not all, of these loans 
from the proceeds of the initial public offering.

In June 1996, the Company revised the promissory notes from certain officers 
of the Company (see Note B) to be due no more than six months from the closing 
date of the Company's initial public offering, rather than in April 1998.

NOTE I - COMMITMENTS AND CONTINGENCIES
--------------------------------------

As of June 30, 1995, the Company has entered into agreements to purchase 
manufacturing equipment totaling $27,780.  Deposits of $14,000 had been paid 
on these commitments and are included in construction in progress.  Payment in 
full on this agreement was made during the year ended June 30, 1996, and is 
included in equipment at June 30, 1996.

In April 1995, the Company entered into a television commercial agreement to 
air an advertising commercial produced for the Company for a one year period 
beginning as soon as the airless bicycle tires are available for shipment.   
During this period, the Company will pay $2 for each bicycle tire sold through 
its retail customers.  The agreement can be extended for an additional year 
upon the agreement of both parties.

In July 1995, the Company entered into a Trade Mark License agreement which 
grants the Company the exclusive right to use the licensor's trade mark 
"Urathon" in the territory, as defined by the agreement.  The Company shall 
pay the licensor a royalty of $.35 per airless bicycle tire sold during the 
term of the agreement, which expires on December 31, 2005.

In August 1995, the Company entered into a consulting agreement with an 
individual for a one year period, subject to one year renewals, which provides 
for monthly payments of $3,000.  The consulting agreement was terminated on 
July 31, 1996.

Due to the timing of the Company's September 1995 private placement during the 
pendency of the Company's registration statement, the Company's reliance on an 
exemption from registration could possibly be challenged.  The Company has 
offered to repurchase such shares sold in the September 1995 private placement 
at the price originally paid plus interest at a 12% annual interest rate from 
the date of original purchase through the date of the repurchase of such 
shares.  At June 30, 1996, the Company estimates its obligation to such 
shareholders, if all shareholders request the Company to reaquire all 40,642

<PAGE> 49
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

shares, at $265,788.  Payment of such obligation of the Company has been 
personally guaranteed by the Chief Executive Officer and the President of the 
Company.  Included in accounts payable and accrued expenses at June 30, 1996, 
is $21,936 of accrued interest related to the shares of common stock subject 
to the recision offer.

NOTE J - SUPPLEMENTAL CASH FLOW INFORMATION
-------------------------------------------

During the year ended June 30, 1996 and the period ended June 30, 1995, cash 
paid for interest amounted to $26,654 and $1,828, respectively.

In February 1995, the Company issued 300,000 shares of common stock in lieu of 
cash payment for consulting services valued at $30,000 of which $29,000 was 
charged to operations during the period ended June 30, 1995, and $1,000 was 
included in deferred offering costs.

In April 1995, the Company issued 170,000 shares of stock at $1.00 per share 
in exchange for notes receivable.  During the period ended June 30, 1995, 
services were provided valued at $26,100, which were offset against the notes 
receivable.  During the year ended June 30, 1996, an additional $8,900 of 
services were provided, which were offset against the notes receivable.

Additionally, in April 1995, the Company issued 100,000 shares of common stock 
in lieu of cash payment for consulting services valued at $100,000 provided by 
the spouses of two officers of the Company.

NOTE K - EVENTS SUBSEQUENT TO THE DATE OF THE REPORT OF INDEPENDENT AUDITOR
---------------------------------------------------------------------------
(UNAUDITED)
-----------

On October 10, 1996, the Company closed its initial public offering.  The 
Company received gross offering proceeds of $2,064,498 in exchange for the 
issuance of 344,083 shares of common stock.  In connection with the offering, 
shareholders owning 34,977 shares elected to accept the Company's recision 
offer and received an aggregate of $193,704.  This amount includes all accrued 
interest due them in connection with the recision offer.PAGE
<PAGE> 50



AMERICAN TIRE CORPORATION
(A Development Stage Company)


<TABLE>
<CAPTION>
BALANCE SHEETS
ASSETS
                                                  DECEMBER 31,
                                                     1996           JUNE 30,
                                                  (Unaudited)         1996
                                                 ------------     ------------
<S>                                              <C>             <C>
Current Assets:
     Cash.......................................   $  634,337      $    4,467
     Trade receivables..........................       26,570          22,767
     Accrued interest receivable................       13,420            -   
     Inventory..................................      131,285         131,285
     Prepaid royalties - related party..........       17,725          17,725
     Prepaid expenses                                  18,853          15,182
     Deposits on inventory......................       87,401          87,401 
                                                   ----------      ----------
          Total current assets..................      929,591         278,827
                                                   ----------      ----------
Property, Plant and Equipment
     Land.......................................       59,000          59,000
     Building and building improvements.........      233,570         229,996
     Equipment..................................      373,176         225,968
     Furniture and fixtures.....................        7,692           7,692
                                                   ----------      ----------
                                                      673,438         522,656
      Less: accumulated depreciation............       62,793          39,299
                                                   ----------      ----------
                                                      610,645         483,357
Other Assets:
     Deposits...................................        2,559           1,834
     Accrued interest receivable................         -              9,993
     Deferred offering costs....................         -            147,108
                                                   ----------      ----------
                                                        2,559         158,935
                                                   ----------      ----------
                                                   $1,542,795      $  921,119
                                                   ==========      ==========














(See accompanying notes to the financial statements)
<PAGE> 51
AMERICAN TIRE CORPORATION
(A Development Stage Company)

</TABLE>
<TABLE>
<CAPTION>
BALANCE SHEETS (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY

                                                  DECEMBER 31,
                                                     1996           JUNE 30,
                                                  (Unaudited)         1996
                                                 ------------     ------------
<S>                                              <C>             <C>
Current Liabilities:
     Line of credit.............................   $     -         $  299,838
     Accounts payable and accrued expenses......       38,895          98,680
     Notes payable-officers and accrued interest         -            265,830
     Accrued payroll - officer..................       30,000            -
                                                   ----------      ----------
          Total current liabilities.............       68,895         664,348

Stockholder Equity:
     Preferred stock, par value $0.001,
      5,000,000 shares authorized, 0 shares
      issued and outstanding                             -               -
     Common stock, par value $0.001, 25,000,000
      shares authorized, 4,176,748 and 3,840,642
      shares issued and outstanding, respectively       4,177           3,841
     Additional paid-in capital..................   2,786,176       1,182,650
     Deficit accumulated during the
      development stage............. ............  (1,231,453)       (844,720)
                                                    ---------      ----------
                                                    1,558,900         341,771
      Less: Receivable-shareholder (officers)         (85,000)        (85,000)
                                                    ---------      ----------
                                                    1,473,900         256,771
                                                    ---------      ----------
                                                   $1,542,795      $  921,119
                                                   ==========      ==========
</TABLE>





















(See accompanying notes to the financial statements)
<PAGE>  52
 AMERICAN TIRE CORPORATION
(A Development Stage Company)
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS 
(Unaudited)

                                                                                
             From
                                   For the Three                 For the 
Six             Inception on 
                                   Months Ended                  Months 
Ended             January 30,
                                   December 31,                  December 
31,            1995 through
                                 ------------------            
-------------------       December 31,
                                 1996          1995            1996           
1995           1996
                              ----------    ----------      ----------     
----------    ------------
<S>                           <C>           <C>             <C>            
<C>           <C>
REVENUE:                                             
 Interest income.............. $   5,763     $   2,117       $   7,480      
$   4,655     $  18,252
                               ---------     ---------       ---------      
---------     ---------
                                   5,763         2,117           
7,480          4,655        18,252
                               ---------     ---------       ---------      
---------     ---------
EXPENSES:
 Consulting...................      -            6,000            -            
14,000       179,079
 Payroll and payroll taxes....    43,814        50,356         110,317         
99,063       362,891
 Administrative...............   173,124        47,206         216,211         
95,453       435,201
 Travel and entertainment.....    15,187        18,427          21,023         
37,522       117,351
 Marketing consulting.........      -             -               
-              -           13,300
 Interest.....................       424         6,125          23,169         
12,800        80,091
 Depreciation.................    12,623         8,861          23,493         
16,230        62,792
                               ---------     ---------       ---------      
---------     ---------
     Total Expenses...........   245,172       134,859         394,213        
275,068     1,250,705
                               ---------     ---------       ---------      
---------     ---------
LOSS BEFORE INCOME TAXES......  (239,409)     (134,859)       (386,733)      
(270,413)   (1,231,453)

 Income taxes.................      -             -               
-              -             -
                               ---------     ---------       ---------      
---------     ---------

NET LOSS...................... $(239,409)    $(134,859)      $(386,733)     
$(270,413)  $(1,231,453)
                               =========     =========       =========      
=========     =========


NET LOSS PER SHARE............ $   (0.05)    $   (0.04)      $   (0.09)     
$   (0.07)    $   (0.30)
                               =========     =========       =========      
=========     =========

WEIGHTED AVERAGE SHARES
 OUTSTANDING.................. 4,176,748     3,840,642       4,118,480      
3,840,642     4,118,480
                               =========     =========       =========      
=========     =========
                                             
</TABLE>





















(See accompanying notes to the financial statements)
<PAGE> 53
AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENTS OF SHAREHOLDERS' EQUITY
FROM THE DATE OF INCEPTION (JANUARY 30, 1995) TO DECEMBER 31, 1996
(UNAUDITED)
<TABLE>
<CAPTION>                                                   Accumulated
                                                            Deficit    
                                                 Additional During         
Notes         Total
                              Common Stock        Paid-in   Development   
Receivable   Shareholders'
                            Shares      Amount    Capital   Stage        
Shareholders    Equity
                          ----------  ---------  ---------  -----------  
------------  -------------
<S>                      <C>        <C>        <C>        <C>          
<C>           <C>
BALANCE, January 30, 1995
 (Inception).............       -     $    -     $     -     $     -     
$       -     $       -
Sale of common stock for
 cash of $.01 per share..  2,510,000      2,510        -           
-             -            2,510
Common stock issued for
 services in February
 1995....................    300,000        300      29,700        
-             -           30,000
Common stock issued for
 services in April 1995..    100,000        100      99,900        
-             -          100,000
Common stock issued for
 notes receivable, of 
 which $50,000 was paid
 in August 1995 and
 $50,000 included in
 current assets at June
 30, 1995................    170,000        170     169,830        -         
(120,000)       50,000
Repayment of notes
 receivable by providing
 services................       -          -           -           -           
26,100        26,100
Sale of common stock for
 cash of $1.00 per share
 pursuant to a private
 placement, net of stock
 issuance costs of
 $78,271.................    720,000        720     641,009        
-             -          641,729
Net loss for the period         -          -           -       
(248,630)         -         (248,630)
                          ----------  ---------  ----------  ----------  
------------  ------------ 
Balance at June 30, 1995   3,800,000      3,800     940,439    (248,630)      
(93,900)      601,709
Repayment of notes
 receivable by providing
 services................       -          -           -           
-            8,900         8,900
Sale of common stock for
 cash of $6.00 per share
 pursuant to a private
 placement...............     40,642         41     243,811        
-            -           243,852
Stock issuance costs.....       -          -         (1,600)       
-            -            (1,600)
Net loss for the year           -          -           -       
(596,090)        -          (596,090)
                          ----------  ---------  ---------- -----------  
-----------   ------------ 
Balance at June 30, 1996   3,840,642      3,841   1,182,650    (844,720)     
(85,000)       256,771
Purchase shares per
 recision offer..........    (34,977)       (35)   (209,827)       
-            -          (209,862)
Sale of common stock for
 cash of $6.00 per share
 pursuant to initial public
 offering (net of stock
 issuance cost of $34,200)   344,083        344   2,029,954        
-            -         2,030,298
Deferred offering costs..       -          -       (273,309)       
-            -          (273,309)
Common Stock issued for 
 debt at $2.10 per share.     27,000         27      56,708        
-            -            56,735
Net loss for period 
 ended December
 31, 1996................       -          -           -       
(386,733)        -          (386,733)
                          ----------  ---------  ---------- -----------  
-----------   ------------
Balance at December 31,
 1996                      4,176,748  $   4,177  $2,786,176 $(1,231,453) $   
(85,000)  $  1,473,900
                          ==========  =========  ========== ===========  
===========   ============
</TABLE>
(See accompanying notes to the financial statements)
<PAGE> 54
AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
                                                                                
                 From inception
                                                   FOR THE                    
FOR THE            On January 30,
                                             THREE MONTHS ENDED           SIX 
MONTHS ENDED        1995 through
                                                DECEMBER 31,                
DECEMBER 31,          December 31,
                                             1996          1995          
1996           1995          1996
                                         ------------  ------------  
------------   ------------  ------------
<S>                                     <C>           <C>           
<C>            <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net loss................................$ (239,409)   $ (134,859)   $  
(386,733)   $  (270,413)  $(1,231,453)
Adjustments to reconcile net loss to net 
 cash used by operating activities:
  Depreciation...........................    12,623         8,861         
23,493         16,230        62,793
  Stock issued in lieu of cash payment for
   certain services......................      -             -              
-              -          129,000
  Services provided in lieu of cash payment
   on receivables - officers                   -            8,900           
-             8,900        35,000
 (Increase) decrease in:
  Other receivable.......................        65          (689)        
(3,803)        (1,024)      (26,570)
  Inventory..............................      -           (6,018)          
-          (131,285)     (131,285)
  Prepaid royalties......................      -           (4,940)          
-            (9,175)      (17,725)
  Prepaid expenses.......................    (6,454)       (6,292)        
(3,671)        (2,414)      (18,853)
  Deposits on inventory and other........      (180)         -              
(725)       114,437       (89,960)
  Accrued interest receivable............    (1,713)       (1,714)        
(3,427)        (3,612)      (13,420)
 Increase (decrease) in:
  Accounts payable and accrued expenses..    25,751        (4,001)       
(60,879)         4,527        38,895
  Due to officer.........................    30,000        (2,114)        
30,000         (8,159)       30,000
                                         ----------     ---------    
-----------    -----------   -----------
     Net cash used by
      Operating activities...............  (179,317)     (142,646)      
(405,745)      (279,988)   (1,232,578)
                                         ----------     ---------    
-----------    -----------   -----------
CASH FLOWS FROM (USED IN)
 INVESTING ACTIVITIES:
 Purchase of property, plant
  and equipment..........................  (148,681)      (17,713)      
(150,782)      (123,581)     (673,438)
                                         ----------     ---------    
-----------    -----------   -----------
     Net cash used by
      Investing activities...............  (148,681)      (17,713)      
(150,782)      (123,581)     (673,438)
                                         ----------     ---------    
-----------    -----------   -----------
CASH FLOWS PROVIDED BY
 FINANCING ACTIVITIES:
 Borrowing on line of credit.............      -           98,000           
-           196,000       397,838
 Repayment on line of credit.............      -          (98,000)      
(299,838)       (98,000)     (397,838)
 Proceeds from notes payable - officers..      -             -           
110,000           -          377,000
 Repayment of notes payable - officers...      -             -          
(317,000)          -         (323,000)
 Proceeds from mortgage note payable.....      -             -              
-              -          188,000
 Repayment of mortgage note payable......      -             -              
-              -         (188,000)
 Proceeds from issuance of
  common stock (net of stock
  issuance costs of $114,071)............   300,012       157,452      
2,030,298        292,252     2,969,524
 Purchase stock per recision offer.......      -             -          
(209,862)          -         (209,862)
 Deferred offering costs.................  (101,025)      (14,929)      
(127,201)       (31,981)     (273,309)
                                         ----------    ----------    
-----------    -----------   -----------
     Net cash provided by
      Financing activities...............   198,987       142,623      
1,186,397        358,271     2,540,353
                                         ----------    ----------    
-----------    -----------   -----------
NET INCREASE (DECREASE) IN CASH..........  (129,011)      (18,036)       
629,870        (45,298)      634,337

Cash at beginning of period..............   763,348        65,467          
4,467         92,729          -
                                         ----------    ----------    
-----------    -----------   -----------
Cash at end of period....................$  634,337    $  47,431     $   
634,337         47,431       634,337
                                         ==========    =========     
===========    ===========   ===========

</TABLE>


(See accompanying notes to the financial statements)
<PAGE>  55
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------- 

NATURE OF BUSINESS: American Tire Corporation, a Nevada corporation ("the 
Company"), was organized on January 30, 1995, to take advantage of existing 
proprietary and non-proprietary technology available for the manufacturing of 
specialty tires.  The Company has had limited operations since its organization 
and is a "development stage" company.  The Company is engaged in 
manufacturing, marketing, and distributing airless bicycle tires.  The 
Company's fiscal year end is June 30.

BASIS OF PRESENTATION:  The accompanying financial statements have been 
prepared on a going concern basis, which contemplates the realization of 
assets and the satisfaction of liabilities in the normal course of business.  
The Company has a very limited operating history, has not generated operating 
revenues to date and must be considered promotional and in its early 
development stages.

On October 10, 1996, the Company closed its initial public offering having 
sold 344,083 shares of common stock for aggregate offering proceeds of 
$2,064,498. The Company's continuation as a going concern is dependent upon 
its ability to utilize the working capital from its initial public offering to 
carry out its business plan and to commence and continue operations.

REVENUE RECOGNITION:  The Company expects to recognize revenue upon the 
shipment of product.

INVENTORY:  Inventory is stated at the lower of cost or market, using the 
first-in, first-out method.  The inventory at December 31, 1996 consists of 
finished goods purchased for resale.

PROPERTY, PLANT AND EQUIPMENT:  Property, plant and equipment are recorded at 
cost.  Depreciation is provided using the straight-line method over the 
estimated useful lives of the assets, as follows:

          Building                    40 years
          Equipment                    5 years
          Furniture and fixtures       7 years

NOTE B - RECEIVABLES - OFFICERS
-------------------------------

In April 1995, the Company entered into subscription agreements with three of 
its officers to acquire an aggregate of 170,000 shares of common stock at a 
purchase price of $1.00 per share, in exchange for promissory notes bearing 
interest at 8% per annum, principal and interest payable in April 1998. At 
December 31, 1996, accrued interest receivable on these notes amounted to 
$13,420. The promissory notes were amended to become due no later than six 
months from the close of the Company's initial public offering (April 10, 
1997). At December 31, 1996, $85,000 was owed under these notes, which has 
been presented as a reduction of shareholders' equity.

PAGE
<PAGE> 56
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)

NOTE C - TECHNOLOGY LICENSE AGREEMENT
-------------------------------------

On June 5, 1995, the Company entered into a technology licensing agreement 
with a related company owned by certain shareholders of the Company.  This 
agreement provides the Company the exclusive license to use, sell and license 
the technology for manufacturing a wheel-tire assembly known as the "Dynamic 
Steerable Spring".  The agreement specifies that a royalty of either $1.00 per 
unit sold directly by the Company or 8% percent of any royalty the Company 
should receive from any third party licensee to be paid quarterly.  At 
December 31, 1996, $17,725 has been advanced pursuant to and in anticipation 
of this agreement and is recorded in prepaid royalties.

NOTE D - RELATED PARTY TRANSACTIONS
-----------------------------------

On October 31, 1996, two of the Company's officers agreed to cancel 
approximately $56,827 in principal and accrued interest due them under certain 
promissory notes (See Note D) in exchange for the issuance of 27,000 shares of 
the Company's restricted common stock at an exchange valued at approximately 
$2.10 per share.


NOTE E - COMMITMENTS AND CONTINGENCIES
--------------------------------------

On November 11, 1996, the Company received a commitment for a line of credit 
of $500,000 from a commercial lender for working capital and equipment 
purchases.  The line of credit will bear an interest rate of 3/4% over prime 
and will be secured by the Company's accounts receivable, inventory, equipment 
and a first mortgage on the Company's Ravenna facility.

At the request of Dennis Chrobak, the Company's President, the Company has 
accrued his monthly employment compensation for October, November and December 
1996.  Mr. Chrobak has requested the Company to continue to accrue his monthly 
employment compensation until further notice.  In January 1997, the Company 
deposited $30,000 into a separate account  and will continue to deposit Mr. 
Chrobak's accrued employment compensation into this account until such time as 
the Company receives notice from Mr. Chrobak that he desires to receive it.

NOTE F - EVENTS SUBSEQUENT TO DECEMBER 31, 1996 
------------------------------------------------

On January 2, 1997, the Company entered into an Agreement in Principle with 
Coronel Investments Limited ("Coronel") to purchase all of Coronel's ownership 
interest in the capital stock of UTI Chemicals (Europe) Ltd., a United Kingdom 
company ("UTI"), engaged in the distribution of urethane tires in the United 
Kingdom and Europe.  The terms of the Agreement in Principle require the 
Company to issue 200,000 shares of its common stock and make a cash payment of 
$400,000 to Coronel and is subject to and conditioned upon the Company and 
Coronel entering into a definitive agreement with respect thereto. 
PAGE
<PAGE> 57 BACK COVER

AMERICAN TIRE CORPORATION

155,000 Shares
Common Stock

PROSPECTUS
_________, 1997


No dealer, salesman or any other person has been authorized to give 
information or to make any representations other than those contained in this 
Prospectus, and, if given or made, such information or representation must not 
be relied upon as having been authorized by the Company. Neither the delivery 
of the Prospectus nor any sale made hereunder shall under any circumstances 
create any implication that there has been no change in the affairs of the 
Company since the date hereof.  This Prospectus does not constitute an offer 
to sell or the solicitation of an offer to buy any securities covered by this 
Prospectus in any state or other jurisdiction to any person to whom it is 
unlawful to make such offer in such state or jurisdiction.

Table of Contents
Section                                                                   Page
-------                                                                   ----
PROSPECTUS SUMMARY.........................................................
RISK FACTORS...............................................................
PLAN OF DISTRIBUTION.......................................................
SELLING SHAREHOLDERS.......................................................
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
 AND RESULTS OF OPERATIONS.................................................
BUSINESS...................................................................
PROPERTY...................................................................
MANAGEMENT.................................................................
EXECUTIVE COMPENSATION.....................................................
PRINCIPAL SHAREHOLDERS.....................................................
CERTAIN TRANSACTIONS.......................................................
DESCRIPTION OF CAPITAL STOCK...............................................
LITIGATION.................................................................
LEGAL MATTERS..............................................................
EXPERTS....................................................................
ADDITIONAL INFORMATION.....................................................
INDEX TO FINANCIAL STATEMENTS..............................................
FINANCIAL STATEMENTS.......................................................

Until February 16, 1998, all dealers effecting transactions in the Common 
Stock, whether or not participating in the distribution, may be required to 
deliver a Prospectus.  This is in addition to the obligation of dealers to 
deliver a Prospectus when acting as underwriters and with respect to their 
unsold allotments or subscriptions.
PAGE
<PAGE> 58
 PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24.  INDEMNIFICATION OF DIRECTORS AND OFFICERS

     Section 78.751 of the Nevada Revised Statutes confers on a director or 
officer an absolute right to indemnification for expenses, including 
attorneys' fees, actually and reasonably incurred by him to the extent he is 
successful on the merits or otherwise in defense of any action, suit, or 
proceeding.  This section also entitles a director or officer to partial 
indemnification against expenses to the extent that he has been successful in 
defending any claim, issue, or matter asserted in such proceeding.  The Nevada 
indemnification section further permits the corporation to indemnify officers 
and directors in circumstances where indemnification is not mandated by the 
statute and certain statutory standards are satisfied.  The Nevada statute 
expressly makes indemnification contingent upon a determination that 
indemnification is proper in the circumstances.   Such determination must be 
made by the board of directors, the shareholders, or independent legal 
counsel.  Nevada law also permits a corporation, in its articles of 
incorporation, bylaws, or an agreement, to pay attorneys' fees and other 
litigation expenses on behalf of a corporate official in advance of the final 
disposition of the action upon receipt of an undertaking by or on behalf of 
the corporate official to repay such expenses to the corporation if it is 
ultimately determined that he is not entitled to be indemnified by the 
corporation.  The corporation may also purchase and maintain insurance to 
provide indemnification.  The  Nevada statute also provides that 
indemnification authorized by the statute is not exclusive of, but is in 
addition to, indemnification rights granted under a corporation's articles of 
incorporation, an agreement, or pursuant to a vote of shareholders or 
disinterested directors.

     The foregoing discussion of indemnification merely summarizes certain 
aspects of indemnification provisions and is limited by reference to Section 
78.751 of the Nevada Revised Statues.

     The Company's articles of incorporation and bylaws do not contain 
specific provisions relating to indemnification of directors, officers, 
employees, and/or agents of the Company.  However, it is anticipated that the 
Company will indemnify its officers and directors to the full extent permitted 
by the above referenced statute.  Insofar as indemnification for liabilities 
arising under the Securities Act may be permitted to directors, officers, and 
controlling persons of the small business issuer pursuant to the foregoing 
provisions, or otherwise, the small business issuer has been advised that in 
the opinion of the Securities and Exchange Commission such indemnification is 
against public policy as expressed in the Securities Act and is, therefore, 
unenforceable.  In the event that a claim for indemnification against such 
liabilities (other than the payment by the small business issuer of expenses 
incurred or paid by a director, officer or controlling person in connection 
with the securities being registered), the small business issuer will, unless 
in the opinion of its counsel the matter has been settled by controlling 
precedent, submit to a court of appropriate jurisdiction the question whether 
such indemnification by the Company is against public policy as expressed in 
the Securities Act and will be governed by the final adjudication of such 
issue.  (See "ITEM 28.  UNDERTAKINGS.")





<PAGE> 59

ITEM 25.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

     The following table sets forth the estimated expenses(*) to the Company 
in connection with the offering described in the Registration Statement:

     Registration Fee............................................$   299.43
     Accounting Fees and Expenses................................  2,500.00*
     Legal Fees and Expenses..................................... 20,000.00*
     Blue Sky Fees...............................................  3,725.00* 
     Printing and Engraving......................................  2,500.00* 
     Transfer Agent Fees.........................................  1,000.00* 
                                                                  ----------  
     Total Expenses..............................................$30,024.43
                                                                  ==========  
(*)     All figures are estimates.


ITEM 26.  RECENT SALES OF UNREGISTERED SECURITIES

     Securities issued in the foregoing transaction were issued in reliance on 
the exemption from registration and the prospectus delivery requirements of 
the Securities Act of 1933, as amended (the "Securities Act"), set forth in 
Section 3(b) and/or Section 4(2) of the Securities Act, and Rule 701 and the 
regulations promulgated thereunder.  All of the individuals receiving shares 
pursuant to Rule 701 did so pursuant to a written agreement relating to the 
compensation of such persons.  No cash consideration was received by the 
issuer and the aggregate offering price for the securities was determined to 
be the fair market value for the consulting services provided.  None of the 
purchasers were officers and directors of the issuer at the time of the 
issuance of the securities.

     In connection with the Company's organization the Company issued an 
aggregate of 2,510,000 shares to its founders, Richard A. Steinke and Dennis 
S. Chrobak.  In February 1995, the Company entered into consulting agreements 
with seven individuals to provided professional advice and services to the 
Company in connection with developing the Company's business operations and 
strategic planning.  The Company issued an aggregate of 300,000 shares of 
common stock for such services.  The value of the services provided was 
$30,000, resulting in a calculated per share value of 300,000 shares at $0.10 
per share.  Set forth below are the names of the individuals, the number of 
shares issued, the value of the services provided, and a brief description of 
the services provided to the Company.

                          Number    Value of    Description    Relationship
                          of        Services    of Services    to the
Name of Shareholder       Shares    Provided    Provided       Company
-------------------       ------    --------    -----------    ------------
Bob L. McGiboney          100,000   $10,000     Financial      Consultant
Jerry Burns                 7,000       700     Financial      Consultant
Todd Hooks                 95,000     9,500     Marketing      Consultant
Craig Hooks                30,000     3,000     Marketing      Consultant
Hugh Sims-Hilditch         50,000     5,000     Technical      Consultant
Brad Delp                   8,000       800     Marketing      Consultant
Elliott N. Taylor          10,000     1,000     Legal          Legal Counsel
                          -------   -------
Totals                    300,000   $30,000
                          =======   =======

<PAGE> 60  

     In April, 1995, the Company entered into consulting agreements with 
Beverly J. Steinke, the former wife of Richard A. Steinke, C.E.O. of the 
Company,  and Bonnie Chrobak, wife of Dennis S. Chrobak, President of the 
Company, to provide the Company with secretarial and media/graphic services, 
respectively, during the Company's developmental  stages.  The Company paid 
both Ms. Steinke and Mrs. Chrobak 50,000 shares each, valued at $1.00 per 
share, for total consideration of $100,000.

     In April, the Company entered into subscription agreements with Gary 
Dalton, Philip Chrobak, and David Griffiths, three of its Officers, to acquire 
an aggregate of 170,000 shares of its Common Stock at a purchase price of 
$1.00 per share, in exchange for promissory notes bearing interest at 8% per 
annum, payable in 36 months. The promissory notes were subsequently amended to 
become due prior to April 10, 1997.  The Company has adopted a policy that any 
future loans or similar arrangements to its officers, directors, or 5% 
shareholders will not occur unless approved by a majority of the disinterested 
directors and for a bona fide business purpose.  Set forth below are the names 
of the Officers, the number of shares issued, the consideration to be received 
for such shares, and their relationship with the Company. 

                         Number of    Consideration  Balance   Relationship
Name of Shareholder      Shares       to be Paid     Due (3)   to the Company
-------------------      ---------    -------------  -------   --------------
Gary Dalton (1)          100,000      $100,000       $40,000   Former Officer
Philip J. Chrobak (2)     50,000        50,000        45,000   Former Officer
David Griffiths           20,000        20,000          -0-    Officer
                         -------      --------       -------
Totals                   170,000      $170,000       $85,000
                         =======      ========       =======

(1)  As of March 31, 1997, Mr. Dalton had paid $50,000 cash and provided 
services to the Company valued at $10,000, which amounts have been applied 
against the principal and interest to be paid under the promissory note.  Mr. 
Dalton resigned as an officer and director of the Company effective February 
25, 1997.

(2)  As of March 31, 1997, Mr. Chrobak had provided services to the Company 
valued at $5,000, which amount has been applied against the principal and 
interest to be paid under this promissory note.  Mr. Chrobak resigned as an 
officer of the Company effective February 25, 1997.

(3)  Amount due does not include any accrued interest.


PAGE
<PAGE> 61

     In May, 1995, the Company issued 720,000 shares of its Common Stock at 
purchase price of $1.00 per share.  Set forth below are the names of the 
purchasers, the consideration paid, and the number of shares purchased:

Name of Shareholder                       Consideration   Number of Shares
-------------------                       -------------   ----------------
John E. Roberts                           $      10,000             10,000
Donald W. Kuchenbecker                           10,000             10,000
Jon Orban                                        10,000             10,000
Robert Orban                                     35,000             35,000
Bob McGiboney                                   110,000            110,000
First London Securities Corporation             110,000            110,000
Edward J. Anderson                               23,000             23,000
M. Priscilla Goodwyn                              5,000              5,000
Michael K. MacCloskey                            80,000             80,000
Mark MacCloskey                                  10,000             10,000
David R. Brod & Laurie A. Strickland, JTWRS       5,000              5,000
Michael P. & Debra B. Anderson                   10,000             10,000
Corporacion de Inversiones Diversificadas       100,000            100,000
Vicent P. Menard                                 10,000             10,000
Jamie M. Nugent                                  10,000             10,000
Arnass Group, Ltd.                              100,000            100,000
Everett Coon, Jr.                                20,000             20,000
Drake, Goodwin & Co., Inc.                       25,000             25,000
James Mathis                                      2,000              2,000
Delaware Charter Guarantee Trust Co.(1)          20,000             20,000
Dorothy D. Winchester Trust                      15,000             15,000
                                           ------------   ----------------
Totals                                     $    720,000            720,000
                                           ============   ================ 

(1) Represents shares held in IRA Accounts at Delaware Charter Guarantee Trust 
Co., FBO Robert M. MacCloskey, 3,000 shares; Karen L. MacCloskey, 2,000 
shares; Mical Lee MacCloskey, 3,000 shares; Michael K. MacCloskey, 2,000 
shares; and Rush B. Winchester, 10,000 shares.

     First London Securities Corporation acted as placement agent in the 
foregoing private placement and received a commission of $70,000 representing 
10% of the offering proceeds from the sale of 700,000 shares.  No commission 
was paid in connection with the sale of 20,000 shares of the foregoing private 
placement.

     Securities issued in the foregoing transaction  were issued in reliance 
on the exemption from registration and the prospectus delivery requirements of 
the Securities Act of 1933, set forth in either Rule 505 or 506 of Regulation 
D and/or Section 4(2) thereof and the regulations promulgated thereunder.  The 
purchasers represented that they were "accredited investors" as that term is 
defined under Rule 501 of Regulation D of the Securities Act.  None of the 
purchasers were Officers and Directors of the issuer at the time of the 
issuance of the securities or currently hold such positions with the issuer.  
Such purchasers were provided information regarding the Company and its 
business and financial condition and met and/or were given opportunity to ask 
questions of the Company's officers and directors.  Subscription agreements 
containing investment and suitability letters and representations were 
executed by each of the purchasers in which they acknowledged that they were 
acquiring "restricted securities" as defined in Rule 144 under the Securities 
Act; that the securities could not be transferred without registration or an 
exemption therefrom; that the securities were being acquired for investment; 
and that the purchasers would not sell the securities without registration or 
the availability of an exemption therefrom.  No general advertising or 
solicitation was used in connection therewith.
<PAGE> 62  

     The placement agent confirmed that solicitation of purchasers of the 
securities were made through contacts by its registered representatives 
without any form of general solicitation or general advertising, including, 
but not limited to, any advertisement, article, notice, or other communication 
published in any newspaper, magazine, or similar media or broadcast over 
television or radio or any seminar or meeting whose attendees were invited by 
any general solicitation or general advertising.

     The Company sold 40,642 shares of Common Stock in September 1995, at a 
purchase price of $6.00 per share.  Set forth below are the names of the 
purchasers, the consideration paid, and the number of shares  purchased:

Name of Shareholder                       Consideration   Number of Shares
-------------------                       -------------   ----------------
James A. & Mary Jo Chrobak                $         600                100
Rolyn, Inc.                                       5,556                926
Rebecca Ann Bradley                                 600                100
William B. & Paunez A. Howell                     5,010                835
Lance R. or Laura MacKeown                          600                100
Robert J. Kieres                                  1,200                200
Kurt R. or Zorianna M. Sterbenz                   9,600              1,600
Eric R. Sterbenz                                  3,000                500
Patrick Kelble                                      600                100
Kevin Kelble & Dee Kennedy                        7,200              1,200
Michael or Rosa Kelble                              600                100
Shawn Kelble                                      1,200                200
Gerald D. Kelble, D.D.S.                         18,000              3,000
Paine Webber IRA Custodian FBO Gerald Kelble     12,000              2,000
Richard or Esther Abramson                        1,200                200
Dennis M. & Karen S. Jenkins                      1,200                200
Joan E. Khatib                                    1,590                265
Sandra S. & Earl W. Crissman                      1,800                300
Ann or Gary Tilly                                 1,800                300
Barbara A. Simpson                                2,100                350
Christley, Harington & Pierce                     2,400                400
Jason W. Sarnow                                   3,000                500
Ken Jones                                         3,000                500
Andy & Marcella Lantzman                          4,998                833
Karen Schaefer                                    4,998                833
Andres & Anita Peterson                           6,000              1,000
Wanda Sharrett, M.D.                              6,000              1,000
Thomas H. & Mary Kaye Laabs-Johnson              18,000              3,000
John P. or Kathy M. Malik                        12,000              2,000
Charles R. & Eileen C. Gant                      18,000              3,000
Dr. Paul Schreibman                              30,000              5,000
Paul Rush                                        60,000             10,000
                                           ------------   ----------------
Totals                                     $    243,852             40,642
                                           ============   ================

     The foregoing shares of Common Stock were offered by the Company's 
Officers and Directors and no commissions, directly or indirectly, were paid 
in connection with their sale.






<PAGE> 63

     Securities issued in the foregoing transaction were issued in reliance on 
the exemption from registration and the prospectus delivery requirements of 
the Securities Act of 1933, set forth in either Rule 505 or 506 of Regulation 
D and/or Section 4(2) thereof and the regulations promulgated thereunder.  
Fifteen  of the thirty purchasers represented that they were "accredited 
investors" as that term is defined under Rule 501 of Regulation D of the 
Securities Act.  None of the purchasers were Officers and Directors of the 
Company at the time of the issuance of the securities or currently hold such 
positions with the issuer.  Such purchasers were provided information 
regarding the Company and its business and financial condition and met and/or 
were given opportunity to ask questions of the Company's Officers and 
Directors. 

     Subscription agreements containing investment and suitability letters and 
representations were executed by each of the purchasers in which they 
acknowledged that they were acquiring "restricted securities" as defined in 
Rule 144 under the Securities Act; that the securities could not be 
transferred without registration or an exemption therefrom; that the 
securities were being acquired for investment; and that the purchasers would 
not sell the securities without registration or the availability of an 
exemption therefrom.  No general advertising or solicitation was used in 
connection therewith.

     The foregoing private placement was made at a time when the Company had a 
registration statement on file with the Commission.  Although the Company took 
steps to ensure that the sale of the common stock would not become part of the 
Company's proposed public offering, due to the timing of the private placement 
during the pendency of the public registration process, the Company's reliance 
on Section 4(2) possibly could have been challenged.  In connection with the 
Company's initial public offering, the Company made a recision offer to the 
purchasers of the 40,642 shares of common stock in an effort to remove and 
reduce as much as possible any liability the Company may have had or could 
have incurred relating to the sale of the common stock.  On termination of the 
recision offer, the Company has received notices of acceptance of the recision 
offer for an aggregate of 34,977 shares.  The Company issued checks to the 
rescinding purchasers in the aggregate of $193,704, which amount included all 
accrued interest in connection therewith.

     On October 31, 1996, Dennis S. Chrobak and Gary Dalton, two of the 
Company's officers and directors, agreed to cancel approximately $56,735 in 
principal and accrued interest due them under certain promissory notes in 
exchange for the issuance of 27,000 shares of the Company's restricted common 
stock at an exchange valued at approximately $2.10 per share.

     Effective February 28, 1997, the Company completed the acquisition of UTI 
Chemicals (Europe), Ltd, a United Kingdom corporation ("UTI-UK"), from Coronel 
Investment Limited, a Jersey corporation ("Coronel").  The acquisition was 
made pursuant to a Share Purchase Agreement, which provided that the Company 
issue to Coronel 200,000 shares of the Company's restricted common stock as a 
portion of the consideration for the purchase of UTI-UK.  The shares issued to 
Coronel were valued at $7.75 per share, the closing bid price for the 
Company's common stock on February 28, 1997.

     The securities issued in the foregoing transactions were issued in 
reliance on the exemption from registration and the prospectus delivery 
requirements of the Securities Act under section 4(2) thereof and the 
regulations promulgated thereunder.
PAGE
<PAGE> 64  

     The Company sold 155,000 shares of Common Stock in February 1997, at a 
purchase price of $6.00 per share.  Set forth below are the names of the 
purchasers, the consideration paid, and the number of shares  purchased:

Name of Shareholder                       Consideration   Number of Shares
-------------------                       -------------   ----------------
Lowell L. Leishman                        $      72,000             12,000
2156 Associates, a Utah partnership             120,000             20,000
William L. Jiler                                 90,000             15,000
Matthew L. & Erin S. Haynie, JTWRS               18,000              3,000
Graphic Arts Management Profit Sharing Plan      90,000             15,000
Frank Lankey                                     30,000              5,000
Jay M. Grossman                                  18,000              3,000
Richard K. & Janice S. Milne, JTWRS              30,000              5,000
James & Carolee Okland, JTWRS                    24,000              4,000
Henry D. Moyle                                  120,000             20,000
David P. Scheffenacker                           24,000              4,000
Theodore S. Green & Debra Beneck                 18,000              3,000
Adele Gilchrist                                   6,000              1,000
Carol H. Tate                                     6,000              1,000
Jeffrey W. Gold, IRA                             36,000              6,000
Jeffrey W. & Robyn Gold, JTWRS                   84,000             14,000
Louis M. Haynie                                  84,000             14,000
Joseph S. Haynie                                  6,000              1,000
Michael L. Haynie                                18,000              3,000
Gae B. Haynie                                    12,000              2,000
Gary R. Howe, IRA                                 6,000              1,000
Gary R. Howe & Sharon F. Howe, JTWRS             18,000              3,000
                                           ------------   ----------------
Totals                                     $    930,000            155,000
                                           ============   ================

     The foregoing shares of Common Stock were offered by the Company's 
Officers and Directors and no commissions, directly or indirectly, were paid 
in connection with their sale.

     Securities issued in the foregoing transaction were issued in reliance on 
the exemption from registration and the prospectus delivery requirements of 
the Securities Act of 1933, set forth in Rule 506 of Regulation D and/or 
Section 4(2) thereof and the regulations promulgated thereunder.  The 
purchasers represented that they were "accredited investors" as that term is 
defined under Rule 501 of Regulation D of the Securities Act.  None of the 
purchasers were Officers and Directors of the Company at the time of the 
issuance of the securities or currently hold such positions with the issuer.  

     Subscription agreements containing investment and suitability letters and 
representations were executed by each of the purchasers in which they 
acknowledged that they were acquiring "restricted securities" as defined in 
Rule 144 under the Securities Act; that the securities could not be 
transferred without registration or an exemption therefrom; that the 
securities were being acquired for investment; and that the purchasers would 
not sell the securities without registration or the availability of an 
exemption therefrom.  No general advertising or solicitation was used in 
connection therewith.





<PAGE> 65  


ITEM 27.  EXHIBITS

     Copies of the following documents have been included as exhibits to this 
Registration Statement, pursuant to Item 601 of Regulation S-B.  The index to 
exhibits required by such item appears at consecutively numbered page 67.

         SEC
Exhibit  Reference
No.      No.        Title of Document                          Location
-------  ---------  -----------------                          --------

  1      3(i)       Articles of Incorporation and Amendments   Incorporated by
                                                               Reference (1)

  2      3(ii)      Bylaws                                     Incorporated by
                                                               Reference (1)

  3      5          Opinion of Taylor and Associates, Inc.
                    Attorneys and Counselors at Law            This Filing

  4      23         Consent of Saltz, Shamis & Goldfarb, Inc.,
                    Certified Public Accountants               This Filing

  5      23         Consent of Taylor and Associates, Inc.,
                    Attorneys and Counselors at Law            This Filing

 
(1)  Incorporated by reference to the Company's registration statement on Form 
SB-2, SEC file no. 33-94318-C, and all amendments thereto.


ITEM 28.  UNDERTAKINGS

     The undersigned Registrant hereby undertakes that it will:

     (1)  File, during any period in which offers or sales are being made, a 
post-effective amendment to this Registration Statement to (i) include any 
Prospectus required by Section 10(a)(3) of the Securities Act; (ii) reflect in 
the Prospectus any facts or events which, individually or in the aggregate, 
represent a fundamental change to the information in the Registration 
Statement; and (iii) include any material information with respect to the plan 
of distribution not previously disclosed in the Registration Statement or any 
material change to such information in the Registration Statement.

     (2)  For the purpose of determining liability under the Securities Act, 
each post-effective amendment will be treated as a new Registration Statement 
of the securities offered, and the offering of the securities at that time 
shall be the initial bona fide offering.

     (3)  If, applicable, file a post-effective amendment to remove from 
registration any of the securities that remain unsold at the end of the 
offering.

     Insofar as indemnification for liabilities arising under the Securities 
Act may be permitted to directors, officers, and controlling persons of the 
Registrant pursuant to the foregoing provisions, or otherwise, the small 
business issuer has been advised that in the opinion of the Securities and 
Exchange Commission such indemnification is against public policy as expressed 
in the Securities Act and is, therefore, unenforceable.
PAGE
<PAGE> 66  

     In the event that a claim for indemnification against such liabilities 
(other than the payment by the Registrant of expenses incurred or paid by a 
director, officer or controlling person in connection with the securities 
being registered), the Registrant will, unless in the opinion of its counsel 
the matter has been settled by controlling precedent, submit to a court of 
appropriate jurisdiction the question whether such indemnification by the 
Registrant is against public policy as expressed in the Securities Act and 
will be governed by the final adjudication of such issue.

     The undersigned Registrant hereby undertakes that it will:

     (1)  For determining any liability under the Securities Act, treat the 
information omitted from the form of Prospectus filed as part of this 
Registration Statement in reliance upon Rule 430A and contained in a form of 
Prospectus filed by the Registrant under Rule 424(b)(1), or (4), or 497(h) 
under the Securities Act as part of this Registration Statement as of the time 
the Commission declared it effective.

     (2)  For determining any liability under the Securities Act, each post 
effective amendment that contains a form of Prospectus will be treated as a 
new Registration Statement for the securities offered in the Registration 
Statement, and that offering of the securities at that time as the initial 
bona fide offering of those securities.
PAGE
<PAGE> 67

AMERICAN TIRE CORPORATION

INDEX TO EXHIBITS

         SEC
Exhibit  Reference
No.      No.        Title of Document                          Location
-------  ---------  -----------------                          --------

  1      3(i)       Articles of Incorporation and Amendments   Incorporated by
                                                               Reference (1)

  2      3(ii)      Bylaws                                     Incorporated by
                                                               Reference (1)

  3      5          Opinion of Taylor and Associates, Inc.
                    Attorneys and Counselors at Law            Exhibit No. 3

  4      23         Consent of Saltz, Shamis & Goldfarb, Inc.,
                    Certified Public Accountants               Exhibit No. 4 

  5      23         Consent of Taylor and Associates, Inc.,
                    Attorneys and Counselors at Law            See Exhibit
                                                               No. 5

 
(1)  Incorporated by reference to the Company's registration statement on Form 
SB-2, SEC file no. 33-94318-C, and all amendments thereto.
[{"type": "S-1", "sequence": "1", "secsgml_size_bytes": 198421}]
{"company-data": {"conformed-name": "AMERICAN TIRE CORP", "cik": "0000945828", "assigned-sic": "3011", "irs-number": "870535207", "state-of-incorporation": "NV", "fiscal-year-end": "0630"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-24665", "film-number": "97575670"}, "business-address": {"street1": "446 W LAKE AVENUE", "city": "RAVEENA", "state": "OH", "zip": "44266", "phone": "330-296-87"}, "mail-address": {"street1": "446 WEST LAKE AVENUE", "city": "RAVENNA", "state": "OH", "zip": "44266"}}
1

Date Filed:  April 7, 1997                            SEC File No.

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

AMERICAN TIRE CORPORATION
----------------------------------------------
(Name of small business issuer in its Charter)

             Nevada                                           87-0535207
------------------------------                          ----------------------
(State or jurisdiction of                               (I.R.S. Employer 
incorporation or organization)                          Identification Number)

446 West Lake Avenue, Ravenna, Ohio  44266 (216) 296-8778
-------------------------------------------------------------
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)

3011
--------------------------------------------------------
(Primary Standard Industrial Classification Code Number)

Copies to:                                Registered Agent:
Elliott N. Taylor, Esq.                   Laughlin Associates, Inc.
Taylor and Associates, Inc.               2533 North Carson Street
3090 East 3300 South, Suite 400           Carson City, Nevada  89706
Salt Lake City, Utah  84109               (800) 648-0966
Phone (801) 463-6080                      ------------------------------------
Fax (801) 463-6085                        (Name, address, including zip code,
                                          and telephone number, including area
                                          code, of agent for service)

     Approximate date of proposed sale to the public:  As soon as practicable 
after the effective date of this Registration Statement.
CALCULATION OF REGISTRATION FEE

Title of Each                         Proposed Maximum   Proposed Maximum     
Amount of
Class of Securities   Amount to       Offering Price     Aggregate Offering   
Registration
to be Registered      be Registered   per Share (1)      Price (1)            
Fee
-------------------   -------------   ----------------   ------------------   
------------
Shares of Common
Stock, $0.001 par
value                 155,000 Shares  $6.375             $988,125.00          
$299.48
(1)  Estimated solely for purposes of calculating the registration fee 
pursuant to Rule 457.  This amount is based upon the average of the high and 
low prices ($6.375) of the common stock of the Registrant as reported on the 
NASD's OTC Bulletin board on April 4, 1997.
2   

If any of the securities being registered on this form are to be offered on a 
delayed or continuous basis pursuant to Rule 415 under the Securities Act of 
1933, check the following box.  [X]

The Registrant hereby amends this registration statement on such dates as may 
be necessary to delay its effective date until the registrant shall file a 
further amendment which specifically states that this registration statement 
shall thereafter become effective in accordance with section 8(a) of the 
Securities Act of 1933 or until the registration statement shall become 
effective on such date as the Commission, acting pursuant to said section 
8(a), may determine.

Exhibit Index appears on consecutively numbered page 67.
PAGE
3
AMERICAN TIRE CORPORATION
Cross Reference Sheet Pursuant to Rule 404(a)

Cross reference between items of Part I of Form S-1 and the Prospectus filed 
by American Tire Corporation, as part of the Registration Statement.

REGISTRATION STATEMENT ITEM NUMBER                    PROSPECTUS
AND HEADING                                           HEADING
----------------------------------                    ----------

1.     Forepart of the Registration Statement and
     Outside Front Cover Page of Prospectus......... Front Cover

2.     Inside Front and Outside Back Cover Page
     of Prospectus.................................. Inside Front Cover and
                                                      Outside Back Cover

3.     Summary Information; Risk Factors; and
      Ration of Earnings to Fixed Charges............ INTRODUCTION; RISK
                                                      FACTORS; Not Applicable
                                                     
4.     Use of Proceeds................................ Not Applicable

5.     Determination of Offering Price................ Not Applicable
                                                      
6.     Dilution....................................... Not Applicable
                                                      
7.     Selling Security Holders....................... SELLING 
SHAREHOLDERS    

8.     Plan of Distribution........................... PLAN OF DISTRIBUTION

9.     Legal Proceedings.............................. LITIGATION

10.     Directors and Executive Officers............... MANAGEMENT
     
11.     Security Ownership of Certain Beneficial
     Owners and Management.......................... PRINCIPAL SHAREHOLDERS

12.     Description of the Securities to
     to be Registered............................... DESCRIPTION OF
                                                      CAPITAL STOCK

13.     Interest of Named Experts and Counsel.......... EXPERTS and 
LEGAL                                                               MATTERS

14.     Statement as to Indemnification................ UNDERTAKINGS

15.     Organization Within Five Years................. BUSINESS

16.     Description of Business........................ BUSINESS

17.     Description of Property........................ PROPERTY

     (A)  Description of Property-Issuers Engaged
           In Significant Mining Operations.......... Not Applicable
     (B)  Supplementary Financial Information
           About Oil and Gas Producing Activities.... Not Applicable
PAGE
4

REGISTRATION STATEMENT ITEM NUMBER                    PROSPECTUS
AND HEADING                                           HEADING
----------------------------------                    ----------

18.     Interest of Management and Others
     in Certain Transactions........................ CERTAIN TRANSACTIONS

19.     Certain Market Information..................... Not 
Applicable                                                                      
         
20.     Executive Compensation......................... EXECUTIVE 
COMPENSATION                                                                   

21.     Financial Statements........................... FINANCIAL STATEMENTS

PAGE
5

PROSPECTUS

SUBJECT TO COMPLETION -- DATED APRIL 7, 1997

155,000 Shares

AMERICAN TIRE CORPORATION

Common Stock

     All of the shares of Common Stock offered hereby are being sold by 
certain shareholders of the Company (the"Selling Shareholders").  See SELLING 
SHAREHOLDERS.  The Company will not receive any proceeds from the sale of the 
shares offered hereby.

     The Common Stock of the Company is traded in the over-the-counter market 
and is quoted on the National Association of Securities Dealers, Inc. OTC 
Bulletin Board (the "OTC Bulletin Board") under the symbol "ATYR".  On April 
4, 1997, the last reported sales price of the Common Stock was $6.50 per 
share.
 
     THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES 
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION; NOR HAS THE 
COMMISSION PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING; NOR HAS ANY 
STATE SECURITIES DIVISION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS 
PROSPECTUS.  ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

==============================================================================
                          Price to      Underwriting       Proceeds to Selling
                          Public        Discounts (1)      Shareholders (1)
------------------------------------------------------------------------------
Per Share...............  $             $0.00              $
Total...................  $             $0.00              $
==============================================================================

(1)  Any commissions or discounts paid in connection with the sale of the 
Common Stock will be paid by the Selling Shareholders and will be determined 
through negotiations between them and the broker-dealer through or to which 
the shares are sold and may vary depending on the broker-dealer's fee 
schedule, the size of the transaction, and other factors.  The Selling 
Shareholders and any broker, dealer, or agent that participates with the 
Selling Shareholders in the sale of the Common Stock may be deemed 
"underwriters" within the meaning of the Securities Act of 1933, as amended 
(the "Securities Act") and any commissions or discounts received by them and 
any profit on the resale of the Common Stock purchased by them may be deemed 
to be underwriting commissions under the Securities Act.  See PLAN OF 
DISTRIBUTION.

The date of this Prospectus is __________, 1997
PAGE
6

     No person has been authorized in connection with any offering made hereby 
to give any information or to make any representation not contained in this 
Prospectus, and, if given or made, such information or representation must not 
be relied upon as having been authorized by the Company.  This Prospectus does 
not constitute an offer to sell or a solicitation of an offer to buy any 
security other than the Common Stock offered by this Prospectus, nor does it 
constitute an offer to sell or a solicitation of any offer to buy any Common 
Stock offered hereby to any person in any jurisdiction where it is unlawful to 
make such an offer or solicitation to such person.  Neither the delivery of 
this Prospectus nor any sale hereunder shall under any circumstances create 
any implication that information contained herein is correct as of any time 
subsequent to the date hereof.

     Changes in the Offering which occur after the date hereof, if any, will 
necessitate the filing with the Securities and Exchange Commission (the 
"Commission") of an amendment to the registration statement of which this 
Prospectus forms a part (the "Registration Statement") and review and 
declaration of effectiveness by the Commission of such amendment.  There can 
be no assurance that any such amendment will become effective.  Should the 
Company file a post-effective amendment and such amendment is not declared 
effective by the Commission, Selling Shareholders will be precluded from 
making offers and from selling the Shares of Common Stock.
PAGE
7

PROSPECTUS SUMMARY

     The following summary is qualified in its entirety by the more detailed 
information and the financial statements and notes thereto appearing elsewhere 
in this Prospectus.

The Company

     American Tire Corporation, a Nevada corporation (the "Company"), was 
organized on January 30, 1995, to take advantage of existing proprietary and 
non-proprietary technology available for the manufacturing of specialty tires. 
The Company has had limited operations since its organization and is a 
"development stage" company.  The Company is engaged in the manufacturing, 
marketing, distribution, licensing, and sales of airless "specialty" tires 
utilizing a "liquid phase" technology.  "Liquid Phase" technology refers to a 
production process where the materials that are utilized in the process are 
initially in a liquid state and, through a reaction (primarily chemical), the 
liquid materials are transformed into a solid state. See BUSINESS.

     The Company has spent extensive time analyzing the tire industry, its 
perceived major competitors, potential markets, and its own strengths and 
weaknesses.  The Company believes that the tire industry is dominated by 
several large competitors, has competitive pressures from cheaper imported 
tires from the Pacific Rim, and maintains a commitment to the traditional 
pneumatic tire with innovations focusing on tread design, not tire design.  
The Company also feels that the tire industry can be divided into several 
segments each with its own dynamics, dominant companies, target customers, and 
competitive pressures.  See BUSINESS.

     The Company feels its strengths are in its technology and research and 
development capabilities.  Its weaknesses are in its size and financial 
capabilities and in changing original equipment manufacturer ("OEM") and 
consumer views on pneumatic tires and the advantages airless tires offer over 
pneumatic tires.  Based on this analysis of the tire industry by the Company, 
a two-pronged approach has been formulated by the Company's management to 
manufacture and market its airless tire concept.

     First, the Company has identified certain industry segments where it 
feels the cost of the tires, the consumer, and the competition will allow it 
to compete effectively against existing pneumatic tires and the companies that 
produce them.  Second, in industry segments where the Company feels it will 
not initially have the financial or manufacturing resources to compete 
effectively, the Company will seek industry partners to manufacture and market 
tires and tire-wheel assemblies developed from the Company's technology. 

     The Company believes that its two-pronged approach for manufacturing and 
marketing its airless tire technology and products will be the most cost 
effective means for the Company to be successful.  The Company is in the 
development stage and since its inception in January 1995 to December 31, 
1996, the Company has had an operating loss of $1,231,453 due to the cost and 
expenses associated with beginning operations.  The report of the Company's 
auditor at June 30, 1996 contains a going concern modification as to the 
ability of the Company to continue.  However, since that time, the Company has 
obtained substantial equity funding which the Company believes is sufficient 
to meet its working capital requirements.  The Company is currently operating 
at a loss of approximately $80,000 per month and expects operating expenses to 
continue at such rate until such time as the Company begins to receive 
revenues from the sale of its products.
8

     The Company's principal offices are located at 446 West Lake Avenue, 
Ravenna, Ohio  44266.  The Company's telephone number is (216) 296-8778. See 
RISK FACTORS and BUSINESS. 

The Offering

Selling Shareholders................ 155,000 shares of Common Stock

Shares Outstanding as of
 Prospectus Date.................... Common Stock:     4,546,748
                                     Preferred Stock:  -0-

Shares Outstanding after Offering... Common Stock:     4,546,748
                                     Preferred Stock:  -0-

Use of Proceeds..................... The Company will not receive any proceeds
                                     from the sale of the Common Stock by the
                                     Selling Shareholders.

Risk Factors........................ There are certain substantial risks
                                     associated with an investment in the
                                     Common Stock, including among others,
                                     risks associated with the absence of
                                     operating revenues or profitable
                                     operations.  See RISK FACTORS.

OTC Bulletin Board Symbol........... Common Stock:  ATYR

PAGE
9

Summary Financial Information

     The following table sets forth selected summarized financial data for the 
Company at the dates and for the periods indicated.  The data should be read 
in conjunction with the financial statements and notes thereto set forth 
elsewhere in this Prospectus.
From
                                      For the Six                   For the 
Years           Inception on 
                                      Months Ended                  Years 
Ended             January 30,
                                      December 31,                  June 
30,                1995 through
                                    ------------------            
-------------------       December 31,
                                    1996          1995 (2)        
1996           1995 (2)       1996
                                 ----------    ----------      ----------     
----------    ------------
STATEMENT OF OPERATIONS DATA:
-----------------------------                                             
 Interest income................. $   7,480     $   4,655       $   8,161      
$   3,611     $  18,252
 Operating Expenses..............   394,213       275,068         
604,251        252,241     1,250,705
 Net Income (Loss)...............  (386,733)     (270,413)       
(596,090)      (248,630)   (1,231,453)
 Net Earnings (Loss) per share...     (0.09)        (0.07)          
(0.16)         (0.06)        (0.30)
 Weighted Average Number
  of Shares Outstanding.......... 4,118,480(1)  3,840,642       3,840,642      
3,800,000     4,118,480

                                       Actual as of
                                   ---------------------
                                   December 31   June 30
                                   -----------   -------
                                      1996 (1)     1996
                                   ----------   ----------
BALANCE SHEET DATA:
------------------
 Cash, cash equivalent............ $  634,337   $    4,467
 Working Capital (Deficit)........    860,696     (385,521)
 Total Assets.....................  1,542,795      921,119
 Total Liabilities................     68,895      664,348
 Shareholders' Equity.............  1,473,900      256,771

(1)  Does not give effect to the issuance of 200,000 shares of restricted 
common stock and the payment of $400,000 in cash for the acquisition of UTI 
Chemicals (Europe), Ltd., effective February 28, 1997; the issuance of 15,000 
shares of common stock pursuant to the exercise of options granted under the 
Company's 1997 Non Qualified Stock Option Plan dated January 29, 1997; or the 
sale of 155,000 shares of restricted common stock and the receipt by the 
Company of $930,000, the proceeds therefrom in February 1997.

(2)  The Company was incorporated on January 30, 1995, therefore the six-month 
period and fiscal year ended June 30, 1995 represent partial periods.
PAGE
10

RISK FACTORS

     THE PURCHASE OF THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF 
RISK.  PROSPECTIVE INVESTORS SHOULD CONSIDER, IN ADDITION TO THE NEGATIVE 
IMPLICATIONS OF ALL MATERIAL SET FORTH HEREIN, THE FOLLOWING RISK FACTORS.

RISK FACTORS RELATING TO THE BUSINESS OF THE COMPANY

Start-up or Development Stage Company

     The Company has had limited operations since its organization and is a 
"start-up" or "development stage" company.  Although certain of the Company's 
Officers have had prior experience in the business of developing, 
manufacturing, and marketing tires and other products, no assurance can be 
given that the Company will be able to compete with other manufacturers of 
such products, virtually all of whom have substantially greater financial 
resources than the Company.  The purchase of the shares of Common Stock 
offered hereby must be regarded as the placing of funds at a high risk in a 
new or "start-up" venture with all the unforeseen costs, expenses, problems, 
and difficulties to which such ventures are subject.  Accordingly, the shares 
of Common Stock offered hereby should not be purchased by persons who cannot 
afford the loss of their entire investment.  See BUSINESS.

Ability of Company to Continue as a Going Concern 

     The report of the Company's auditors at June 30, 1996, contains a 
modification as to the ability of the Company to continue as a going concern. 
However, since the date of that report the Company has obtained substantial 
funding from the sale of its equity securities which the Company believes is 
adequate to satisfy its current working capital requirements to continue in 
business.  See FINANCIAL STATEMENTS. 

No Assurance of Profitability and Working Capital Deficit

      The Company had an operating loss of $1,231,435 since its inception 
through December 31, 1996 due to the costs and expenses associated with a 
start-up operation.  As of December 31, 1996, the date of the Company's most 
recent financial statements included in this Prospectus, the Company has 
experienced no revenues from the sale of any products, however the Company had 
working capital of $860,696.  The Company has only recently commenced the 
commercial sale of its products and has not received substantial revenues from 
operations.  There can be no assurance the Company will be able to develop 
into a successful or profitable business.  See BUSINESS.

Dependence on Management and Key Personnel 

     The Company has been substantially dependent on the services of Richard 
A. Steinke and Dennis S. Chrobak, two of the Company's Officers and Directors, 
and for some time will be dependent on the general business acumen and 
experience of all of its Officers and Directors and the application of such 
skills to the business decisions required on behalf of the Company.   The 
Company has entered into employment agreements with Messrs. Steinke and 
Chrobak for a three year period, however, the Company does not carry key-man 
insurance on either Mr. Steinke or Mr. Chrobak, thus, the loss of a key 
employee's services could have a material adverse effect on the Company's 
operations.  See MANAGEMENT.
PAGE
11

Patents and Trademarks  

     The Company has acquired license rights to certain technology, 
proprietary data, and know-how relating to both a method for manufacturing a 
combined tire-wheel assembly ("DSS Technology") and for manufacturing a 
non-pneumatic tire ("Airless Tire Technology") for which applications for 
United States Letters Patent have been filed and are currently pending. The 
DSS Technology and Airless Tire Technology were invented by affiliates of the 
Company.  The DSS Technology and the Airless Tire Technology were obtained by 
the Company at no cost through technology license agreements with American 
Mobility Systems ("AMS"), an entity controlled by Richard A. Steinke and 
Dennis S. Chrobak.  The DSS Technology agreement provides for a royalty 
payment to AMS of either $1.00 for each unit of production manufactured and 
sold directly by the Company or eight percent (8%) of any royalty the Company 
should receive from third party licensees that utilize the DSS Technology.  
The Company will pay AMS a royalty of $0.25 for each tire sold by the Company 
utilizing the Airless Tire Technology.  In addition, to the extent that such 
technologies have not been developed to the point of practical application or 
that the safety and efficiency of the technologies has not yet been 
established, the Company has agreed to hold AMS harmless from all liabilities, 
costs, and fees relating to any claim, demand, or suit and the defense thereof 
arising from the use, sale, or license of the technologies. The DSS Technology 
and the Airless Tire Technology agreements were not negotiated at arms length. 
In addition, the Company has not obtained an opinion of an independent third 
party as to the fairness of the terms of the technology license agreements 
with AMS. See CERTAIN TRANSACTIONS.

     There can be no assurance that any patents relating to the DSS Technology 
or the Airless Tire Technology will in fact be issued to AMS or, if issued, 
that such patents will give the Company any protection against competitors or 
that such patents will not be infringed upon or modified by others.  The 
Company has not retained intellectual property counsel to render an opinion 
regarding the DSS Technology and the Airless Tire Technology as to whether the 
Company is infringing on the intellectual property rights of others.  In that 
regard, the Company believes that the DSS Technology is unique. See BUSINESS.

Dependence on AMS for Technical Assistance 

     The Company has acquired its technology from AMS, a corporation 
controlled by Richard A. Steinke and Dennis S. Chrobak, two of the Company's 
Officers and Directors.  It is probable that all new technology obtained by 
the Company may originate from AMS and will be licensed to the Company for 
development in exchange for the payment of a royalty.  The Company will be 
relying significantly on AMS to provide it with technical assistance, however, 
any new technology developed by the Company's employees within the scope of 
their employment or that otherwise relates to the nature of the Company's 
business will be considered the Company's proprietary technology.  The license 
agreements between the Company and AMS may be terminated by AMS upon the 
occurrence or continuance of any one or more events of default (e.g., failure 
to pay royalties when due) following written notice from AMS and the Company's 
failure to cure the default within 30 days of such notice.  See CERTAIN 
TRANSACTIONS.
12

Product Liability Insurance 

     The sale of the Company's products may expose it to liability claims 
resulting from the use of such products.  Such claims may be expected to be 
larger in the specialty tire manufacturing area, where product failure may 
result in property and other damages, including injury to persons or loss of 
life. The Company has obtained product liability insurance which it believes 
to be sufficient to cover its existing product manufacturing requirements, 
however, no assurance can be given that such insurance will be adequate to 
cover potential claims or, that if a claim or claims are made, such insurance 
will not be canceled. 
     
Competition 

     The Company believes, that currently there are three foreign bicycle tire 
manufacturers that utilize a liquid phase technology manufacturing process to 
produce airless bicycle tires with only one marketing its tires in the United 
States.  In addition to manufacturers of airless bicycle tires, the Company 
will be competing directly with  firms that manufacture and/or market 
pneumatic bicycle tires.   The Company estimates that over 98% of all domestic 
bicycle tire sales are pneumatic tires.  The bicycle tire industry is highly 
competitive and there are several of the Company's competitors that have 
financial resources which substantially exceed those of the Company.

     Currently, there are no spare, passenger car, light, medium or heavy 
truck tire manufacturers that utilize the liquid phase technology 
manufacturing process to produce tires. Should the Company obtain FMVSS 129 
approval for its tire-wheel assembly and Hayes commences manufacturing and 
selling such tire-wheel assemblies,  the Company will be competing indirectly 
with companies that manufacture and/or market pneumatic tires for passenger 
vehicles and light trucks. Many of these companies have company owned outlets 
or franchised stores that sell products manufactured by these companies.   The 
Company believes that the motor vehicle tire market will be highly competitive 
and there could be several companies that manufacture pneumatic tires that 
have financial resources which exceed those of Hayes. Although the Company's 
tire-wheel assemblies will be unique in the tire marketplace, Hayes may be at 
a disadvantage in competing with older, larger, and more established companies 
while attempting to establish itself in the tire industry in general. See 
BUSINESS.

Potential Conflicts of Interest 

     The Company has in the past engaged in various transactions with its 
Officers, Directors, principal shareholders, and affiliates, including 
obtaining short-term loans, purchasing the Company's manufacturing facility, 
and obtaining licenses to certain technology.  Consequently, it is possible 
that potential conflicts of interest may arise in the future in connection 
with the interpretation and/or enforcement of the underlying agreements.  For 
example, the Company has recently entered into agreements with AMS to license 
certain technology.  It is probable that all technology obtained by the 
Company will originate from AMS and licensed to the Company for development of 
the technology in exchange for the payment of a royalty.  In addition, the DSS 
Technology and Airless Tire Technology agreements provide that AMS be paid for 
any technical assistance it provides the Company in further developing such 
technologies, if any.
13

     The Company will be relying significantly on AMS to provide it with 
technical assistance, however, any new technology developed by the Company's 
employees within the scope of their employment or that otherwise relates to 
the nature of the Company's business will be considered the Company's 
proprietary technology.  In this regard, Messrs. Steinke and Chrobak and/or 
AMS could retain possible business opportunities for themselves at the 
potential expense of the Company.  As a result, the Company may experience 
conflicts of interest relating to the appropriation of business opportunities 
by its Officers and Directors, the payment of royalties due under the 
agreement with AMS, and other matters.  If conflicts do arise, they will not 
be resolved through arms length negotiations, but through reliance on and 
enforcement of employment and confidentiality and non-disclosure agreements 
with Company employees and the exercise of management's judgment consistent 
with its fiduciary responsibility to the Shareholders.  All future 
transactions with affiliates will be for a bona fide business purpose and be 
on terms no less favorable than could be obtained from unaffiliated parties.  
See CERTAIN TRANSACTIONS.

Limited Liability of Management 

     The Nevada Revised Statutes generally provide that a company's directors 
shall have no personal liability to the company or its stockholders for 
monetary damages for breaches of their fiduciary duties as Directors, except 
for breaches of their duty of loyalty, acts or omissions not in good faith or 
which involve intentional misconduct or a knowing violation of law, acts 
involving unlawful payment of dividends or unlawful stock purchases or 
redemptions, or any transaction from which a director derives an improper 
personal benefit.  Accordingly, Shareholders may have no recourse against 
Directors of the Company for bad business decisions.  However, liability of 
Directors for violation of the federal securities laws is not limited by these 
provisions.

Regulation and Environmental Considerations 

     The Company is subject to various local, state, and federal laws and 
regulations including, without limitation, regulations promulgated by federal 
and state environmental, health, and labor agencies, and has engaged a 
consultant to advise it with respect to compliance with applicable 
environmental regulations.  Prior to commencing operations the Company spent 
$5,140 to comply with various environmental regulations and no additional 
expenditures by the Company have been required. However, changes in the laws 
and regulations governing the Company's business may impose an increased financi
al burden upon the Company that could adversely affect the Company's business 
or operations.  Actions by federal, state, and local governments concerning 
environmental or other matters could result in regulations that could increase 
the cost of producing the products to be manufactured and sold by the 
Company. 

      Certain of the Company's operations will be subject to federal, state, 
and local laws and environmental regulations that impose limitations on the 
discharge of pollutants into the air and/or water.  The Company believes that 
it will be able to operate in compliance with such regulations.  While the 
Company has not had to make significant capital expenditures relating to 
environmental compliance, the Company cannot predict with any certainty its 
future capital expenditure requirements relating to environmental compliance 
because of its limited operations and continually changing compliance 
standards and technology.  See BUSINESS.
14

Lack of Insurance for Environmental Liabilities

     The Company does not have insurance coverage for environmental 
liabilities and does not anticipate obtaining such coverage in the future.  
See BUSINESS. 

Issuance of Additional Common Stock and Preferred Stock 

     The Company currently has authorized 25,000,000 shares of Common Stock, 
par value $0.001 per share, of which 4,546,748 shares were issued and 
outstanding prior to this Offering.  The Company currently has authorized 
5,000,000 shares of Preferred Stock, par value $0.001 per share, of which no 
shares were issued and outstanding.  Although the Company's Board of Directors 
has no present intention to do so, the Board of Directors has authority, 
without action by or vote of the Company's Shareholders, to issue all or part 
of the authorized but unissued shares.  In addition, the Company's Board of 
Directors has authority, without action by or vote of the Company's Shareholders
, to fix and determine the rights, preferences, and privileges of the 
Preferred Stock, which may be given voting rights superior to that of the 
Common Stock, which power may be used to hinder or deter a takeover proposal, 
should any occur.  Any issuance of additional shares of Common Stock or 
Preferred Stock will dilute the percentage ownership interest of Shareholders 
and may further dilute the book value of the Company's shares.  See 
DESCRIPTION OF CAPITAL STOCK. 

Common Stock Could Become a Designated Security/Penny Stock 

     Should the bid price for the Company's Common Stock fall below $5.00 per 
share, the Company's Common Stock would become subject to special sales 
practice requirements applicable to "designated securities" and "penny 
stock".  No assurance can be given that the bid price for the Company's Common 
Stock will continue to be above $5.00 per share. If such $5.00 minimum bid 
price is not maintained and another exemption is not available, the Company's 
Common Stock would become subject to additional sales practice requirements 
imposed on broker-dealers who sell the Common Stock to persons other than 
established customers and accredited investors (generally institutions with 
assets in excess of $5,000,000 or individuals with net worth in excess of 
$1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their 
spouse).  

     For transactions covered by these rules, the broker-dealer must make a 
special suitability determination for the purchaser and have received the 
purchaser's written agreement to the transaction prior to the sale.  These 
rules may be anticipated to affect the ability of broker-dealers to sell the 
Company's Common Stock, which may in turn be anticipated to have an adverse 
impact on the market price for the Common Stock and the ability of purchasers 
to sell their shares in the secondary market.  The Company believes that if 
the bid price should fall below $5.00 per share it would continue to be exempt 
from the sales practice requirements because it would meet certain minimum 
asset and net worth tests.  No assurance can be given however, that the 
Company will be able to meet the terms of such exemption or that, if met 
initially, it would continue to meet the terms of such exemption in the 
future.

Lack of Dividends 

     The Company has not paid, and does not plan to pay, dividends in the 
foreseeable future even if the Company is profitable.  Earnings, if any, are 
expected to be used to expand the Company's operations and for general 
corporate purposes, rather than to make distributions to Shareholders.
15

Possible Sale of Common Stock Pursuant to Rule 144 

     The Company has previously issued shares of Common Stock that constitute 
"restricted securities" as that term is defined in Rule 144 adopted under the 
Securities Act.  Subject to certain restrictions, such securities may 
generally be sold in limited amounts two years after their acquisition.     
The Commission has recently adopted a proposal to reduce the holding period 
prior to which shares may be eligible for resale under Rule 144 from two years 
to one year.  The amendments to Rule 144 take effect on April 29, 1997, and 
once effective, the rule will allow the above mentioned restricted securities 
to be eligible for resale one year earlier.

     The Company issued 2,510,000 shares of Common Stock to initial 
Shareholders in connection with its organization.  The Company issued an 
additional 300,000 shares of Common Stock to various individuals for 
professional and consulting services during February 1995.  In April 1995, the 
Company issued 170,000 shares to certain Officers and 100,000 shares for 
professional services.  In May 1995, the Company issued 720,000 shares in a 
private placement.  The shares issued to insiders (2,510,000 shares to 
founders and 170,000 shares to other Officers) are currently eligible for 
resale under Rule 144.  However, in connection with the Company's initial 
public offering, the Company's Officers, Directors, and Shareholders owning 
more than 5% of the Company's issued and outstanding shares of Common Stock 
agreed not to sell any shares owned directly or indirectly by them for a 
period of up to four years, subject to the Company obtaining certain net 
earnings requirements.

     The 400,000 shares of Common Stock issued to consultants for professional 
services in February and April 1995 were issued pursuant to an exemption from 
registration available under Rule 701 of the Securities Act, and are now 
eligible for resale pursuant to the resale limitations set forth in Rule 
701(c) which provides that 90 days after the Company becomes subject to the 
reporting requirements of Section 13 or Section 15(d) of the Securities 
Exchange Act of 1934 (i.e., May 28, 1996), securities issued in a Rule 701 
transaction may be resold by persons other than affiliates in reliance on Rule 
144, without compliance with (1) current information, (2) holding period, (3) 
volume limitation, and (4) notice requirements of Rule 144; and by affiliates 
without compliance with the holding period requirements of Rule 144.

     The 720,000 shares of restricted Common Stock sold by the Company in the 
May 1995 will become eligible for sale under Rule 144 in May 1997. Sales of 
these restricted securities under Rule 144 or otherwise may have a depressive 
effect on the price of the Company's Common Stock in any trading market that 
may develop following this Offering.  After the implementation of the 
amendment to Rule 144, securities held for two years may be sold by 
nonaffiliates without limitation.  See PRINCIPAL SHAREHOLDERS and DESCRIPTION 
OF CAPITAL STOCK. 

PAGE
16

PLAN OF DISTRIBUTION

Selling Shareholders

     The Selling Shareholders may sell up to 155,000 shares of Common Stock 
from time to time directly to purchasers.  Alternatively, the Selling 
Shareholders may, from time to time, offer the Common Stock to underwriters, 
dealers, or agents, which may receive compensation in the form of underwriting 
discounts, concessions, or commissions from the Selling Shareholders and/or 
the purchasers of the Common Stock from whom they may act as agent, as the 
case may be.  The Selling Shareholders and any underwriters, dealers, or 
agents that participate in the distribution of such securities, may be deemed 
to be "underwriters," and any profits on the sale of these securities by them 
and any discounts, commissions, or concessions received by any underwriters, 
dealers, or agents may be deemed to be underwriting discounts and commissions 
under the Securities Act.

     The Common Stock may be sold by the Selling Shareholders, as the case may 
be, from time to time, in one or more transactions at a fixed offering price, 
which may be changed, or at varying prices determined at the time of sale or 
at negotiated prices.  The Company does not intend to enter into any 
arrangements with any securities dealers concerning solicitation of offers to 
purchase the Common Stock.  The Selling Shareholders will pay all separate 
expenses incurred by them incident to the offer and sale of the Common Stock, 
including commissions and discounts to broker-dealers.

     Commissions and discounts paid in connection with the sale of the Common 
Stock by the Selling Shareholders will be determined through negotiations 
between them and the broker-dealers through or to which the securities are to 
be sold and may vary, depending on the broker-dealers fee schedule, the size 
of the transaction, and other factors.  The separate costs of the Selling 
Shareholders will be borne by them.  The Selling Shareholders and any 
broker-dealer or agent that participates with the Selling Shareholder in the 
sale of the Common Stock by them may be deemed "underwriters" within the 
meaning of the Securities Act, and any commissions or discounts received by 
them and any profits on the resale of Common Stock purchased by them may be 
deemed to be underwriting commissions under the Securities Act.

     The Company has agreed to pay all expenses incurred by the Company in 
registering the Common Stock for resale by the Selling Shareholders.  In 
addition, the Company has agreed to utilize its best efforts to keep the 
registration statement effective until February 16, 1998.  The Company is 
under no obligation to maintain the effectiveness of any registration 
statement beyond February 16, 1998, or that date following the date on which 
all the shares of Common Stock registered pursuant to this registration 
statement have been sold by the Selling Shareholders, which ever occurs 
first.  PAGE
17

SELLING SHAREHOLDERS

     The following table provides certain information with respect to the 
Common Stock held by each Selling Shareholder.  None of the Selling 
Shareholders has had a material relationship with the Company.  The percent of 
Common Stock is calculated on the number of the Company's shares issued and 
outstanding as of the date of this Prospectus.  None of the shares of Common 
Stock may be offered and sold by the Selling Shareholders after February 16, 
1998.  The Common Stock offered by the Selling Shareholders under this 
Prospectus may be offered from time to time by the following persons:

Name of Shareholder                       Number of Shares  % of Common Stock
-------------------                       ----------------  -----------------
Lowell L. Leishman                               12,000               .26 
2156 Associates, a Utah partnership              20,000               .44
William L. Jiler                                 15,000               .33 
Matthew L. & Erin S. Haynie, JTWRS                3,000               .07 
Graphic Arts Management Profit Sharing Plan      15,000               .33 
Frank Lankey                                      5,000               .11 
Jay M. Grossman                                   3,000               .07 
Richard K. & Janice S. Milne, JTWRS               5,000               .11 
James & Carolee Okland, JTWRS                     4,000               .09 
Henry D. Moyle                                   20,000               .44 
David P. Scheffenacker                            4,000               .09 
Theodore S. Green & Debra Beneck                  3,000               .07 
Adele Gilchrist                                   1,000               .02 
Carol H. Tate                                     1,000               .02 
Jeffrey W. Gold, IRA                              6,000               .13
Jeffrey W. & Robyn Gold, JTWRS                   14,000               .31
Louis M. Haynie                                  14,000               .31 
Joseph S. Haynie                                  1,000               .02 
Michael L. Haynie                                 3,000               .07 
Gae B. Haynie                                     2,000               .04 
Gary R. Howe, IRA                                 1,000               .02
Gary R. & Sharon F. Howe, JTWRS                   3,000               .07
                                           ------------   ----------------
Totals                                          155,000              3.42 
                                           ============   ================

PAGE
18

MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Plan of Operation

     The Company's is engaged in the manufacturing, marketing, distribution, 
and sale of airless specialty tires utilizing "liquid phase" technology.  
"Liquid Phase" technology refers to a production process where the materials 
that are utilized in the process are initially in a liquid state and, through 
a reaction (usually chemical), the liquid materials are transformed into a 
solid state.

     The Company operates "centrifugal molding machines" and other related 
specialized manufacturing equipment to produce the airless bicycle tires. The 
Company has utilized funds from its initial public offering to purchase 
additional molding machines and related production equipment, which is 
currently being installed and will be ready for production during April 1997.

     The Company is in the development stage and has only recently began 
manufacturing operations. The Company has had an operating loss of $1,231,453 
since its inception through  December 31, 1996 due to the costs and expenses 
associated with beginning operations.  The Company's audited financial 
statements at June 30, 1996, contained a going concern modification as to the 
ability of the Company to continue.  However, In October 1996, the Company 
received $2,064,498 from its initial public offering, which the Company 
believes will provide it with sufficient working capital to fund operations.  
The Company is currently operating at a loss of approximately $80,000 per 
month and expects operating losses to continue at such rate until such time as 
the Company begins to receive revenues from the sale of its products.

     At December 31, 1995, the Company had only been organized for eleven 
months and had no significant operations, therefore management's discussion 
and analysis of the prior period ended December 31, 1995 with the current 
period ended December 31, 1996, would not be conducive to an understanding of 
the Company and its fiscal condition or have any meaningful significance.

     On November 11, 1996, the Company received a commitment for a line of 
credit of $500,000 from a commercial lender for working capital and equipment 
purchases.  This line of credit will bear an interest rate of 3/4% over prime 
and will be secured by the Company's accounts receivable, inventory, equipment 
and a first mortgage on the Company's Ravenna facility.  At December 31, 1996, 
the Company had not made any draws against the line of credit.

     On October 31, 1996, the Company approved the issuance of 27,000 shares 
of the Company's restricted common stock in exchange for the cancellation of 
approximately $56,735 in principal and accrued interest due certain of its 
officers and directors. 

     In February 1997, the Company raised offering proceeds of $930,000 from 
the sale of 155,000 shares of restricted common stock in a private placement.  
The 155,000 shares of Common Stock sold in that private placement are the same 
155,000 shares of Common Stock being offered hereunder by the Selling 
Shareholders.  See SELLING SHAREHOLDERS. 

     The Company will be relying on the proceeds from the Company's recent 
securities offerings and the Company's line of credit to meet further 
operating requirements should the Company fail to receive sufficient revenues 
from the sale of products to meet its operational needs.
19

     On January 2, 1997, the Company entered into an Agreement in Principle 
with Coronel Investments Limited ("Coronel") to purchase all of Coronel's 
ownership interest in the capital stock of UTI Chemicals (Europe) Ltd., a 
United Kingdom company ("UTI-UK"), in exchange for 200,000 shares of the 
Company's common stock and a cash payment of $400,000.  UTI-UK is a 
distributor of urethane products in the United Kingdom and Europe.  Effective 
February 28, 1997, the Company completed the acquisition of UTI-UK. 

BUSINESS

Organization and Corporate History

     The Company was organized on January 30, 1995, by Richard Steinke and 
Dennis Chrobak to take advantage of existing proprietary and non-proprietary 
technology available for the manufacturing of specialty tires. Mr. Steinke has 
several years experience in top-management positions in public companies 
engaged in manufacturing products utilizing emerging technology and personally 
holds patents on urethane products and processes.  In addition, Mr. Chrobak 
has over 30 years of tire industry experience in tire design, manufacturing, 
and marketing as an engineer for Goodyear Tire and Rubber Company and 
personally holds patents on tire structures and manufacturing processes. The 
Company has had limited operations since its organization and is a 
"development stage" company.  However, the Company believes that the 
experience and intellectual contributions of Mr. Steinke and Mr. Chrobak to 
the Company are key components to the future success of the Company.

     Following its organization, in May 1995 the Company completed a private 
placement of 720,000 shares of Common Stock to a limited number of investors, 
raising net proceeds of $641,729, after deducting sales commissions of 
$70,000, and $8,271 in offering expenses.  The funds received by the Company 
were utilized to purchase a manufacturing facility in Ravenna, Ohio, and to 
purchase specialized manufacturing equipment. In September 1995, the Company 
sold an additional 40,642 shares in a private placement raising gross proceeds 
of  $243,852.   No commissions were paid, directly or indirectly, in 
connection with the sale of those shares.   The proceeds from these prior 
offerings have been utilized by the Company to fund its ongoing operations.  
The 40,642 shares of Common Stock sold in September 1995 have been subject to 
a Recision Offer and in October 1996, the Company repurchased from investors 
34,977 shares for an aggregate of $193,704, which amount includes all accrued 
interest.   

     In October 1996, the Company completed an initial public offering of 
344,083 shares of Common Stock at a purchase price of $6.00 per share for 
gross offering proceeds of $2,064,498.  The Company has used the proceeds from 
the offering to initiate production of airless tires which will compete with 
the traditional pneumatic tires (i.e., tires with an inner tube or tubeless 
tires inflated with air), repurchase the shares of Common Stock subject to the 
Recision Offer, repay loans from Officers, and for working capital.

     Effective February 28, 1997, the Company completed the acquisition of all 
of the capital stock of UTI-UK.  The acqusition was made pursuant to a Share 
Purchase Agreement, wherein the Company agreed to acquire UTI-UK from Coronel 
in exchange for the payment of 200,000 shares of the Company's restricted 
common stock and a cash payment of $400,000. The Company utilized proceeds 
derived from the February 1997 private placement to make the cash portion of 
the purchase price.  The closing bid price for the Company's common stock on 
February 28, 1997 (the "Closing Date") was $7.75.
20

     Based on the closing bid price for the Company's common stock and the 
$400,000 cash, the purchase price of UTI-UK was valued at $1,950,000.  For 
purposes of accounting treatment, the acquisition of UTI-UK will be treated as 
a purchase by the Company.

     UTI-UK has since 1990 been a distributor of urethane bicycle, wheelchair 
and other specialty tires in the United Kingdom and Europe.  UTI-UK 
distributes urethane bicycle tires under the trade name "Urathon TM" in 
approximately 540 Michelin Tire Company owned ATS stores in England, Scotland 
and Wales.  UTI-UK also sells product in France, Denmark, Austria, the 
Netherlands and Germany through independent representatives and distributors.

     In connection with the acquisition of UTI-UK, the Company and Coronel 
entered into a lock-up agreement, wherein Coronel agreed not to sell during 
the 24 month period following the Closing Date (i.e., through March 1, 1999), 
more than 50,000 shares of the Company's common stock acquired, provided 
however, all such sales of the Company's common stock during the lock-up 
period are made in a market transaction pursuant to an effective registration 
statement or in reliance on an exemption from registration under the 
Securities Act of 1933, as amended.

     In addition, the Company entered into a management agreement with 
Coronel, wherein Coronel has been retained to manage the day-to-day operations 
of UTI-UK for a 12-month period beginning February 1, 1997, in exchange for a 
monthly fee of US$9,990, and Hugh-Sims Hilditch, the principal shareholder of 
Coronel was appointed to the Company's board of directors and to serve as 
Managing Director for European Operation.

Business in General

     The Company has spent extensive time analyzing the tire industry, its 
perceived major competitors, potential markets, and its own strengths and 
weaknesses.  The Company believes that the tire industry is dominated by 
several large competitors, has competitive pressures from cheaper imported 
tires from the Pacific Rim, and maintains a commitment to the traditional 
pneumatic tire with innovations focusing on tread design not tire design.  The 
Company also feels that the tire industry can be divided into several segments 
each with its own dynamics, dominant companies, target customers, and 
competitive pressures. The Company believes that its technology will allow it 
to produce an airless tire which offers the same safety and ride as the 
traditional pneumatic tire, at competitive prices, without the associated 
problems resulting from a flat tire.  The ability to avoid down time from flat 
tires will be particularly appealing to industrial concerns where down time 
can be readily equated into lost dollars.

     The Company feels its strengths are in its technology and research and 
development capabilities.  Its weaknesses are in its size and financial 
capabilities and in changing Original Equipment Manufacturer ("OEM") and 
consumer views on pneumatic tires and the advantages of going airless.  Based 
on this analysis of the tire industry, a two-pronged approach has been 
formulated by the Company's management to manufacture and market its airless 
tire concept.
PAGE
21

     First, the Company has identified certain industry segments where it 
feels the cost of the tires, the consumer, and the competition will allow it 
to compete effectively against existing pneumatic tires and the companies that 
produce them.  These industry segments are segments the Company feels will be 
accessible, its products will be readily acceptable, and the Company will not 
be at an insurmountable competitive disadvantage.  One such area is the 
bicycle tire market where almost all tires are currently imported.  The 
Company feels it can offer the end user the advantage of not having to worry 
about flats or leaks.

     Second, in industry segments where the Company feels it will not 
initially have the financial or manufacturing resources to compete 
effectively, the Company will seek an industry partner to manufacture and 
market  tires products developed from the Company's technology.  The Company 
will, therefore, have a very fluid organization that will not be bound to the 
traditional role as strictly a manufacturer and marketer of products, but 
instead, a company exploring the non-traditional avenues, including joint 
ventures for developing and licensing the Company's technology.  The Company 
feels that through these means, with respect to some products developed 
utilizing the Company's technology, the Company will be able to attain broader 
public recognition without incurring the additional equipment and related 
costs and expenses associated with being strictly a manufacturer and marketer. 
With respect to products developed through joint ventures and license 
agreements, the Company will maintain a profit interest by having a royalty or 
other carried interest in every unit of production sold through such 
arrangements based on gross sales price.

Hayes Development and License Agreement

     In September 1995, the Company and Hayes Wheels International ("Hayes") 
entered into a Development and License Agreement (the "Hayes Development and 
License Agreement") wherein the Company and Hayes have agreed to jointly 
develop a prototype tire-wheel assembly utilizing the DSS Technology, together 
with associated molds and equipment, for submission to the United States 
Department of Transportation ("DOT") for DOT's approval under FMVSS 129. Under 
the joint development aspect of the Hayes Development and License Agreement, 
the Company will, at its cost, develop and manufacture the molds and process 
for applying side coverings, elastomeric tread, and a cap stabilizer onto the 
Hayes manufactured DSS.  Hayes, at its cost, will develop and manufacture 
molds and equipment to manufacture the steel portion of the DSS.  FMVSS 129 is 
the applicable U.S. safety standard for non-pneumatic tires used on passenger 
vehicles and describes the energy cycle a non-pneumatic tire/wheel must absorb 
to be provided for commercial sale in the United States.  The Company has 
received prototype wheels from Hayes, built the molds for applying the side 
coverings, tread, and stabilizing cap, and produced several tire-wheel 
assembly prototypes that have been delivered to an independent lab for testing 
to ensure that the tire/wheel assembly complies with FMVSS 129. The Company 
has submitted for testing 7 of 10 planned submissions to an independent 
laboratory.  The tests performed have been designed to provide the Company 
with data relating to the dynamics, material composition, and performance of 
the tire-wheel assembly. From the data developed from testing of the first 
seven prototypes, the Company has established what the Company and Hayes 
believe to be the best design and polymer compound for the tire-wheel assembly 
to meet the requirements of FMVSS 129.  The final three submissions will be 
based on that design and polymer compound. Because of limited working capital, 
the Company had suspended prototype testing until completion of its initial 
public offering.  The Company plans to resume prototype testing beginning in 
May 1997.
22

Airless Bicycle Tires

     Airless bicycle tires differ from pneumatic tires in that pneumatic tires 
are made from rubber and require an inner tube which is inflated with air, 
while the Company's airless bicycle tires are manufactured from polyurethane, 
have no inner tube (solid throughout), and do not require inflation.  The 
airless bicycle tire is mounted on the bicycle rim in much the same way a 
pneumatic tire is mounted, with the assistance of a special tire lever.  The 
Company will provide with each tire, special tire levers, (about 12 inches 
long to provide for sufficient leverage), to assist  the cyclist in mounting 
the tire to the wheel rim.  The airless bicycle tires are approximately the 
same weight as pneumatic tires and tubes and ride characteristics are 
comparable. Apart from cleaning, the Company's bicycle tires are maintenance 
free.  This is of particular importance in relation to braking performance.  
Pneumatic tires normally require regular attention to maintain full inflation 
pressure to ensure correct brake operation.  The Company's airless bicycle 
tires eliminate tedious puncture repair or the need for a bicycle pump.  They 
are designed  for use by  "On/Off" road and "Highway" bicycles.  The Company 
will initially market the airless bicycle tires in two colors, fluorescent 
yellow and conventional black, however, it may choose to introduce additional 
colors in the future.

     The Company's marketing strategy will be to initially introduce the 
bicycle tires through sales to OEMs and direct advertising to consumers 
through television commercials. The Company intends to target two main 
consumer segments of the bicycle tire market:

     (1)  Original Equipment Manufacturers.  Based on 1993 data, OEM purchases 
of bicycle tires made up one-third of the total volume of the bicycle tire 
market.  By selling to OEM's, the Company believes it will be able to develop 
product identification and consumer demand by emphasizing "Made in the USA," 
the "airless," "maintenance free," and "puncture proof" characteristics of the 
bicycle tires while relying on the efforts of the OEM in marketing their 
bicycles.   The Company has made production molds to produce bicycle tires for 
Huffy Bicycle, Celina, Ohio to produce eight lines in four sizes (i.e., 26", 
24", 20", and 16" x 1.95") for use with Huffy's 1997 production bicycles. 
Huffy has prepared its 1997 Bicycle Catalog featuring bicycles equipped with 
the Company's airless tires.  Huffy is marketing the airless tires as the 
EnviroSafety Tire ("EST") that never goes flat and has placed an open order 
with the Company to deliver 50,000 tires in varying sizes during 1997, subject 
to meeting mutually agreeable pricing for the product.

     (2)  Direct Advertising.  In April 1995, the Company entered into a 
television commercial agreement with American Independent Network of Ft. 
Worth, Texas ("AIN"), to air a commercial (the "Commercial") produced by the 
Company for a one year period beginning as soon as airless bicycle tires are 
available for shipment.  AIN covers 129 stations, in 75 markets, covering 
34,668,949 households.  AIN will air the Commercial at times selected by it 
and the Company at time slots between 6:00 AM and 12:00 Midnight on an average 
of once an hour, with particular emphasis placed during the airing of 
afternoon children's programs, news reports, and sports programming.  The 
total program will give the Company approximately 10 airings per day during 
the one year term.  The Company has established an 800 telephone number that 
will allow customers to call the Company to make purchases direct from the 
Company utilizing a credit card.  The Company has agreed to pay AIN a 
commission of $2.00 for each bicycle tire sold by the Company resulting from 
direct advertising effort.  The Company has not made any substantive studies 
to determine the degree of market penetration it can reasonably expect to 
obtain from the airing of the Commercial, nor has it established an exact date 
to begin airing the Commercial.
23

Competition

     Currently, there are three tire manufacturers that utilize a liquid phase 
technology manufacturing process to produce airless bicycle tires (Green Tire, 
Norwich, UK; Woo Tire, Waihai, China; and Krypton-India, Calcutta, India), and 
very limited numbers of their airless bicycle tires have been marketed  in the 
United States.  The technology that these companies use to manufacture their 
bicycle tires was originally developed by Vincent Panaroni, who has in the 
past provided consulting services to the Company, and the co-inventor of the 
Company's Airless Tire Technology. See MANAGEMENT.

     The Company's Airless Tire Technology differs from the existing 
technology in (1) the formulation of the polyurethane; (2) the manner in which 
the polyurethane is distributed throughout the mold; (3) and implementation of 
a circumferential steel cord; (4) the manner in which the tire seats in the
wheel rim; and (5) the manner in which the tire is manufactured to comply with 
ISO and U.S. tire and rim specifications and U.S. truth-in-labeling laws.  In 
addition to manufacturers of airless tires, the Company will be competing 
directly with firms that manufacture and market pneumatic bicycle tires.

     The Company estimates that over 98% of all domestic bicycle tire sales 
are pneumatic tires.  The bicycle tire  industry is highly competitive and 
there are several of the Company's competitors that have financial resources 
which substantially exceed those of the Company.  In addition, many 
competitors are large companies (i.e. Michelin [France], Kenda [Japan], and 
Chengshin Rubber [China]) that have established name recognition of their 
product, have established distribution networks for their products, and 
developed consumer loyalty to such products.  The Company knows of no domestic 
manufacturer of pneumatic bicycle tires.  Principal factors in marketing the 
Company's bicycle tire will be that it is domestically produced with "airless" 
and "puncture proof" characteristics.  This may give the Company a competitive 
advantage against pneumatic bicycle tires produced by foreign manufacturers 
that are subject to puncture and loss of air.

     Currently, there are no spare, passenger car, light, medium or heavy 
truck tire manufacturers that utilize the liquid phase technology 
manufacturing process to produce tires and the Company knows of no other 
company that has developed a combined tire-wheel assembly for motor vehicles.  
The Company is utilizing an established industry partner to bear the cost of 
manufacturing and marketing spare, passenger car, and light truck tires 
developed from DSS technology.  Therefore, the Company will be competing 
indirectly with companies that manufacture and/or market pneumatic passenger 
vehicle and light truck tires [i.e., Goodyear, Michelin, and Bridgestone].  
Many of these companies have company owned outlets or franchised stores that 
sell products manufactured by these companies. The Company feels that the car 
and truck tire market will be highly competitive and there may be several 
companies that manufacture pneumatic tires that have financial resources which 
exceed those of the Company and its industry partners.  Although the Company's 
airless automobile and truck tires will be unique in the tire market place, 
the Company will be at a disadvantage in competing with older, larger, and 
more established companies while attempting to establish itself in the tire 
industry in general.
PAGE
24

Manufacturing, Supplies, and Quality Control

     The Company manufactures the airless bicycle tires utilizing single 
and/or multiple head, centrifugal molding machines.  These machines 
centrifugally mold elaster products, such as the bicycle tires, by pouring a 
predetermined amount of polyurethane into a mold, which is then spread out in 
the mold through centrifugal force.  The molding process occurs when the 
liquid polyurethane formula (made up of isocyanide and polyol) is combined 
with a catalyst. This combination causes a chemical reaction that results in 
the cross linking of the chemicals, which thereafter become solid.  The mold 
then moves to the next station where the tire is removed and the process 
continues.

     The Company has recently installed an additionaly 12-station carousel and 
the Company estimates that a crew of three persons will be able to produce 
approximately 4,000 tires in an 8 hour shift, or approximately 1,000,000 tires 
per year utilizing the Company's existing production equipment.  The Company 
estimates that it could produce about 12 to 15 million tires per year without 
expansion from its Ravenna facility. At that level of production, the Company 
would require approximately 200 employees.  The Company will train its 
employees in the use of this specialized manufacturing equipment and process, 
which will be utilized for other types of specialty tires as well.  The 
Company intends to utilize multiple suppliers to purchase polyurethane and 
believes that it will be able to obtain significant quantities of polyurethane 
and other chemicals without significant problems or delays.

     All products produced by the Company will be inspected following the 
manufacturing process and prior to shipment to ensure quality.  Products 
considered by the Company's quality control personnel to be defective could be 
ground into pellets, which can be melted and reused in the Company's 
manufacturing process to make new products and reduce waste of raw materials.

Patents

     Dynamic Steerable Spring

     On June 5, 1995, the Company entered into a technology license agreement 
(the "DSS License Agreement") with American Mobility Systems, Inc., a Nevada 
corporation ("AMS"), controlled by Dennis S. Chrobak and Richard A. Steinke, 
affiliates of the Company, to develop DSS Technology.  DSS Technology is a 
combination of a spring compressively loaded and a one piece spiral hoop load 
in tension.  DSS Technology can be utilized in tire-wheel assemblies for many 
types of mobile products including spare tires, passenger car tires, and 
light, medium, and heavy truck tires.  AMS is the owner of the DSS Technology 
for which an application for United States Letters Patent has been filed and 
issuance of a patent is pending. The term of the DSS License Agreement will be 
for  the life of the underlying U.S. patent when issued.  The Company is 
required to pay a royalty to AMS of either $1.00 for each unit of production 
manufactured and sold directly by the Company or eight percent (8%) of any 
royalty the Company should receive from third party licensees that utilize the 
DSS Technology.
PAGE
25

     Airless Bicycle Tires

     On October 27, 1995, the Company entered into a technology license 
agreement (the "Airless Tire License Agreement") with AMS, to develop certain 
technology relating to an airless bicycle tire for which AMS has filed an 
application for United States Letters Patent and the issuance of a patent is 
pending.  The term of the Airless Tire License Agreement will be for the life 
of the underlying U.S. patent when issued.  The Company is required to pay a 
royalty to AMS of $0.25 for each bicycle tire manufactured and sold by the 
Company utilizing the technology.

     The Company has not yet received from the United States Patent Office any 
response passing on the patentability of the claims of the case with respect 
to the either the DSS Technology or the Airless Bicycle Tire Technology.  The 
Company is unable to predict when any office action will be taken or a patent 
issued.  Although a patent has a statutory presumption of validity in the 
United States, the issuance of a patent is not conclusive as to its validity, 
nor as to the enforcement scope of the claims contained therein.  The Company 
intends to, but has not as of the date of this Prospectus, applied for patent 
protection in other countries.  The Company intends to vigorously police its 
patent and there can be no assurance that its patent will not be infringed 
upon or modified by others.

     The Company has not retained intellectual property counsel to render an 
opinion regarding the DSS Technology and the Airless Tire Technology as to 
whether the Company is infringing on the intellectual property rights of 
others.  In that regard, the Company believes the DSS Technology is unique in 
that the Company knows of no other manufacturer of  airless passenger vehicle 
tires or tire-wheel assemblies.  With respect to the Airless Bicycle Tire 
Technology, the Company believes that its technology substantially differs 
from the existing technology currently being utilized to produce airless 
bicycle tires.  The Company believes that although its patents are important, 
such factors as product innovation, technical expertise and experience, and 
the confidentiality of proprietary data and trade secrets are equally as 
important.  The Company will attempt to preserve and protect its proprietary 
technology principally through trade secret protection and has obtained 
confidentiality/nondisclosure agreements with all of its employees.

Trademark

     Through its wholly owned subsidiary UTI-UK, the Company owns the U.S. 
registered trademark "Urathon TM" which has been utilized by UTI-UK on 
urethane tire products distributed in the United Kingdom and Europe.
PAGE
26

Regulation and Environmental Compliance

     In connection with the manufacturing of airless bicycle tires, the 
Company knows of no particular federal or state regulations applicable to its 
manufacturing process.  However, the Company intends to manufacture its 
bicycle tires in compliance with any applicable ISO standards.  Certain tire 
wheel assemblies designed to be manufactured for use on passenger vehicles and 
light trucks are required to meet certain Department of Transportation, 
Federal Motor Vehicle Safety Standards ("FMVSS"), including FMVSS 129, which 
applies to non-pneumatic tires for passenger cars.  This standard specifies 
tire dimensions and laboratory tests requirements for lateral strength, 
endurance, and high speed performance, defines the tire load rating, and 
specifies labeling requirements for non-pneumatic spare tires.  All tire-wheel 
assemblies for use in passenger car and light truck applications developed by 
the Company will be engineered to meet applicable FMVSS standards. 

     The Company is subject to various local, state, and federal laws and 
regulations including, without limitation, regulations promulgated by federal 
and state environmental and health agencies, the federal Occupational Safety 
and Health Administration, and laws pertaining to hiring, treatment, safety, 
and discharge of employees.  The Company's manufacturing operations must also 
meet federal, state, and local regulatory standards in the areas of labor, 
safety, and health.  Since its inception, the Company has spent $5,140 to 
comply with various environmental regulations and no additional expenditures 
by the Company have been required.  The Company believes that it will be able 
to operate in compliance with such regulations, including laws related to the 
handling and use of environmentally hazardous materials.

Employees

     As of March 31, 1997, the Company had 16 full-time employees.  All of the 
Company's Officers and key personnel are employees at will, except Messrs. 
Steinke and Chrobak.  None of the Company's employees is represented by a 
labor union.  The Company believes that it will be able to hire a sufficient 
quantity of qualified laborers in the local area to meet the Company's 
employment needs.  The Company's manufacturing process does not require 
special training, other than orientation to the Company's production 
techniques and specific equipment. 

PROPERTIES

Offices

     The Company's 26,000 sq. ft. manufacturing/distribution/office facility 
is located on 4.15 acres of real property at 446 West Lake Street, Ravenna, 
Ohio, and consists of 1,000 sq. ft. of administrative offices and 25,000 sq. 
ft. of manufacturing space. The facility is constructed of masonry and steel 
and is equipped with a one-half ton chain hoist, overhead sprinkler system, 
and two loading docks. The Ravenna facility will be utilized for tire 
production and management of the Company believes that the Ravenna facility 
will be sufficient to handle projected  production needs for the next five 
years.  It is the opinion of management that the Company maintains adequate 
insurance coverage for loss or damage to its facility under its existing 
insurance policy.PAGE
27

MANAGEMENT

Directors and Executive Officers

     The following table sets forth as of March 31, 1997, the name, age, and 
position of each executive officer and director and the term of office of each 
Director of the Company.

   Name            Age  Position                    Director or Officer Since
   ----            ---  --------                    -------------------------

Richard Steinke    54   Chairman, Director,
                         and C.E.O.                 January 1995

Dennis S. Chrobak  57   President and Director      January 1995

Roger A. Fleming   56   Vice-President, Technology  January 1997

Hugh Sims-Hilditch 58   V.P., European Operations
                         and Director               February 1997

Ping Zhang         31   V.P., China Operations
                         and Director               February 1997

David K. Griffiths 59   Treasurer                   February 1995

Marcy L. Janus     29   Secretary                   March 1997

     The term of office of each Director is one year and until his successor 
is elected and qualified at the Company's annual meeting, subject to removal 
by the Shareholders.  The term of office for each Officer is one year and 
until a successor is elected at the annual meeting of the Board of Directors 
and is qualified, subject to removal by the Board of Directors.  The Company 
will reimburse Directors for their expenses associated with attending 
Directors' meetings.  However, Directors have not, nor is it anticipated they 
will, receive any additional compensation for attending Directors' meetings.

Biographical Information

     Set forth below is certain biographical information for each of the 
Company's Officers and Directors and other key personnel.

     Richard Steinke is a founder of the Company and currently serves as its 
Chairman and Chief Executive Officer.  From January 1992 to December 1994, Mr 
Steinke served as Chairman and C.E.O. of Alanco Environmental Resources, Inc. 
[NASDAQ: ALAN], a manufacturer of environmental/pollution control equipment, 
Salt Lake City, Utah.  From June 1985 to December 1991, he was the Chairman 
and C.E.O. of UTI Chemicals, Inc.[NASDAQ: UTEC],  a developer and manufacturer 
of urethane chemicals, El Toro, California.  Mr. Steinke brings to the Company 
several years of top level management experience in public companies involved 
in the use of emerging technologies.  Mr. Steinke received a B.A. in Political 
Science and Economics from the University of Arizona, Tucson, Arizona, in 
1967.
PAGE
28

     Dennis S. Chrobak is a founder of the Company and currently serves as its 
President and is a Director.  From January to December 1994, Mr. Chrobak was 
self-employed as an engineer/consultant.  Prior to his retirement in 1994, Mr. 
Chrobak was employed by Goodyear Tire and Rubber Company, Akron, Ohio, for 33 
years.  During that time, Mr. Chrobak served in various employment capacities, 
including Staff Engineer, 1962; Senior Project Engineer, 1963-1968; Section 
Leader, Military Aircraft Tire Engineering, 1968-1970; Chief Engineer, Race 
Tire Engineering, 1970-1974; General Manager, International Race Tyre
Division, UK, 1974-1979; Product Manager, New Passenger Tire Products, 1981 to 
1983; Chief Engineer; Tire/Wheel Systems Engineering, 1983-1985; Chief
Engineer, Technology Forecasting, Planning, and Business Coordination, 1985
to 1987; and Chief Engineer, Specialty Tire Programs, 1987 to 1994.  Mr. 
Chrobak received a B.S. in Chemical Engineering, Case Institute of Technology, 
Cleveland, Ohio, in 1961, and MBA (then Case-Western) in 1989.  In addition, 
Mr. Chrobak has received several certifications relating to additional 
education and training in the chemical/tire industry.  Mr. Chrobak is the 
inventor of 9 patents relating to tire technology and has published several 
papers relating to issues in the tire industry.  Mr. Chrobak is active in his 
church and community, including 40 years devoted to various positions in the 
Boy Scouts. 

     Roger A. Fleming, joined the Company in February 1997 as its 
Vice-President of Technology.  Prior to joining the Company Mr. Fleming was a 
senior engineer at Goodyear Tire & Rubber Company, Akron, Ohio, were Mr. 
Fleming had worker for over 31 years.  Mr. Fleming holds many patents in 
product and process design and has managed the development of Goodyear's 
liquid phase united spare tire. Mr. Fleming received a degree in Chemical 
Engineering from North Carolina State University, Raleigh, North Caroline in 
1963.

     Hugh-Sims Hilditch joined the Company as its Vice-President of European 
Operations and a Director in February 1997 in connection with the Company's 
acquisition of UTI-UK.  Mr. Sims-Hilditch has in excess of the past five years 
served as the Manager of UTI-UK, Hilmarton, England, a distributor of urethane 
products in the United Kingdom and Europe.

     Ping Zhang was named the Company's Vice-President of China operations and 
a director in February 1997.  Mr. Zhang has for the past three years been 
actively involved in promoting U.S.- China business and trade relationships.  
Mr. Zhang received a Masters Degree in Manufacturing and Industrial Technology 
from Arizona State University, Tempe, Arizona, in 1993, and a degree in 
Mechanical Engineering from Shanghai Jiatong University, Shanghai, China, in 
1991.

     David K. Griffiths currently serves as the Company's Treasurer and 
principal accounting officer and has since 1960 been self-employed as an 
accountant/consultant for various small businesses.  Mr. Griffiths offers the 
Company 36 years experience in accounting and accounting related systems.

     Marcy L. Janus currently serves as the Company's Secretary.  In December 
1989, Marcy received a B.A. in Communications from Kent State University, 
Kent, Ohio.  Ms. Janis brings to the Company seven years experience in 
executive office management and computer services.
PAGE
29

KEY EMPLOYEES

     Shanley Brown joined the Company in January 1997 and serves as the 
Company's domestic sales manager.  Mr. Brown brings to the Company over 20 
years of experience in both domestic and international sales for bicycles and 
light duty pneumatic tires.  From 1994 to 1996, Mr. Brown, was Vice President 
of the Industrial Tire Division of Shinko USA, Carson City, California, a 
division of Shin Hung Co., Ltd., Osaka, Japan.  From 1991 to 1994, he was the 
National Sales Manager for Kenda Tire USA, Columbus, Ohio.  From 1984 to 1991, 
Mr. Brown was the Midwest Regional Manager for Greenball Corporation, Long 
Beach, California, a distributor of products for Cheng Shin Rubber, Taipei, 
Taiwan and from 1976 to 1984, Mr. Brown was the District Manager for Carlisle 
Tire and Rubber, Carlisle, Pennsylvania.  Mr. Brown received an Associate 
degree in Business Administration at Ohio University at Lancaster, Ohio in 
1970.

     Derek A. Bowers, joined the Company in June 1995.  From May 1994 to June 
1995, Mr. Bowers was employed by Huffy Bicycle Company, Celina, Ohio, as an 
engineer.  Mr. Bowers received a M.S. in Mechanical Engineering from Carnegie 
Mellon University, Pittsburgh, Pennsylvania, in May 1994 and a B.S. in 
Mechnical Engineering from Old Dominion University, Norfolk, Virginia, in May 
1993.

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

     The Company is not subject to the requirements of Section 16(a) of the 
Exchange Act.
PAGE
30

EXECUTIVE COMPENSATION

     The following tables set forth certain summary information concerning the 
compensation paid or accrued for each of the Company's last two completed 
fiscal years to the Company's or its principal subsidiaries chief executive 
officer and each of its other executive officers that received compensation in 
excess of $100,000 during such period (as determined at June 30, 1996, the end 
of the Company's last completed fiscal year):

SUMMARY COMPENSATION TABLE
Long Term Compensation
                                                       ----------------------

                     Annual Compensation               Awards       Payouts
                                           Other      Restricted
Name and                                   Annual      Stock     Options 
LTIP     All other
Principal Position Year  Salary  Bonus($) Compensation Awards   /SARs   
Payout  Compensation
------------------ ----  ------  -------- ------------ ------   ------- 
------  ------------
Richard A. Steinke  1996   $-0-     -0-       -0-         -0-      -0-     
-0-       -0-
C.E.O. and Chairman 1995    -0-     -0-       -0-         -0-      -0-     
-0-       -0-
Employment Agreements and Benefits

      The Company has entered into Employment Agreements with Richard A. 
Steinke, its Chief Executive Officer, and Dennis S. Chrobak, its President.  
Beginning October 1, 1996, the Employment Agreements call for Mr. Steinke and 
Mr. Chrobak to be employed for a term of 36 months, with monthly compensation 
of $10,000, each, subject to increase at the discretion of the Board of 
Directors.  The Company is to provide group health, medical, and life 
insurance, similar to that which will be made available to all full time 
employees and reimburse Messrs. Steinke and Chrobak for out-of-pocket expenses 
incurred in connection with the Company's business.  In the event of 
termination of either Mr. Steinke's or Mr. Chrobak's employment, for reasons 
other than cause, as defined in each employment agreement, the terminated 
parties monthly salary would continue throughout the balance of the term of 
the employment agreement.   The Company does not have employment agreements 
with any other officer and director or other key personnel. 

     At the request of Dennis Chrobak, the Company's President, the Company 
has accrued his monthly employment compensation for October, November and 
December 1996.  Mr. Chrobak has requested the Company to continue to accrue 
his monthly employment compensation until further notice.  In January 1997, 
the Company deposited $30,000 into a separate account  and will continue to 
deposit Mr. Chrobak's accrued employment compensation into this account until 
such time as the Company receives notice from Mr. Chrobak that he desires to 
receive it.
PAGE
31

     As a condition to employment, all the Company's managers and key 
personnel are required to sign a nondisclosure and noncompetition agreement.  
Under the terms of the nondisclosure and noncompetition agreement, employees 
will not be able to provide services or information deemed confidential by the 
Company to any other company or person which directly or indirectly competes 
with the Company in the tire industry or an industry which at the time of the 
employees' employment, the Company intended to enter.  There is no time 
limitation on the nondisclosure aspect of the agreement.  The noncompetition 
clause is for a period of two years and prevents a former employee or 
consultant of the Company from acting as an employee, consultant or in any 
other capacity for a competitor of the Company.  Additionally, all employees 
will be required, as a condition of their employment, to enter into a 
nondisclosure agreement related to any information or process deemed 
confidential by the Company.

Consulting Agreement with Vincent Panaroni

     In August 1995, the Company entered into a consulting agreement with 
Vincent Panaroni, wherein Mr. Panaroni has agreed to provide the Company with 
technical advice relating to chemical formulations and the development of 
polyurethane compounds for use in products manufactured or licensed by the 
Company for manufacture by third parties.  The term of the Company's 
consulting arrangement with Mr. Panaroni is one year, subject to renewals for 
like periods, and provides for monthly payments of $3,000.  The consulting 
agreement restricts Mr. Panaroni from  disclosing to third parties proprietary 
information regarding the Company's products and keeping confidential 
information and knowledge gained as a result of the services provided. This 
Agreement was terminated at July 31, 1996 and the Company and Mr. Panaroni 
have agreed to utilize Mr. Panaroni's services on an ad hoc basis with Mr. 
Panaroni's compensation to be determined on a project by project basis.

Pension Table

     None.

Compensation of Directors

     None.

Termination of Employment and Change of Control Arrangement

     Unless otherwise disclosed above, there are no compensatory plans or 
arrangements, including payments to be received from the Company, with respect 
to any person named in Cash Compensation set out above which would in any
way result in payments to any such person because of his resignation, 
retirement, or other termination of such person's employment with the Company 
or its subsidiaries, or any change in control of the Company, or a change in 
the person's responsibilities following a changing in control of the Company.

PAGE
32

PRINCIPAL SHAREHOLDERS

     The following table sets forth as of March 31, 1997, the name and the 
number of shares of the Company's Common Stock, par value $0.001 per share, 
held of record or beneficially by each person who held of record, or was known 
by the Company to own beneficially, more than 5% of the 4,546,748 issued and 
outstanding shares of the Company's Common Stock, and the name and 
shareholdings of each director and of all officers and directors as a group.

Security Ownership of Certain Beneficial Owners

Title  
 of      Name and Address              Amount and Nature of     Percentage 
Class    Beneficial Owner              Beneficial Ownership(1)   of Class
-----    ----------------              --------------------     ----------
Common   Dennis S. Chrobak             D     1,255,000             27.6
         2914 Silver Lake Blvd.        I (2)    50,000              1.1
         Silver Lake, OH 44224   

Common   Richard A. Steinke            I (3)   455,000             10.0
         446 West Lake Street          I (4)   800,000             17.6
         Ravenna, OH  44266

Security Ownership of Management of the Company 

Title  
 of      Name and Position of          Amount and Nature of     Percentage 
Class    Officer and/or Director       Beneficial Ownership(1)   of Class
-----    -----------------------       --------------------     ----------
Common   Dennis S. Chrobak, President        ---See Table Above---
         and Director

Common   Richard A. Steinke, C.E.O.          ---See Table Above---
         and Director

Common   Hugh Sims-Hilditch, Director  I (5)   245,000              5.4

Common   Ping Zhang, Director          D          -                  -

         All Officers and Directors
          as a Group (7 person)        D     1,275,000             28.0
                                       I     1,550,000             34.1
                                             ---------             ----
         Total Beneficial Ownership          2,825,000             62.1
                                             =========             ====
    
(1) Indirect and Direct ownership are referenced by an "I" or "D", 
respectively.  All shares owned directly are owned beneficially and of record 
and such shareholder has sole voting, investment, and dispositive power, 
unless otherwise noted.

(2) Represent shares owned beneficially and of record by Bonnie Chrobak, the 
wife of Dennis S. Chrobak, and which Mr. Chrobak may be deemed to have 
indirect beneficial ownership over such shares.

(3) Represent shares owned beneficially and of record by Gemini Funding 
Services Profit Sharing Account, of which Richard A. Steinke is the principal 
beneficiary.
[Footnotes continue on next page]
33

(4) Represent shares owned beneficially and of record by S102 Irrevocable 
Trust, for which Richard A. Steinke is the trustee.

(5) Represent shares owned beneficially and of record by Coronel Investments 
Limited, a Jersey Corporation, of which Mr. Sims-Hilditch is the principal 
owner.

CERTAIN TRANSACTIONS

Technology License Agreements

     DSS License Agreement

     On June 5, 1995, the Company entered into a technology license agreement 
(the "DSS License Agreement") with AMS, an entity controlled by Dennis S. 
Chrobak and Richard A. Steinke, affiliates of the Company.  AMS is the owner 
of certain technology known as the "Dynamic Steerable Spring" ("DSS") for 
which an application for United States Letters Patent has been filed and is 
currently pending. The License Agreement grants the Company an exclusive to 
use, sell, license, or otherwise exploit the DSS Technology worldwide in 
exchange for a royalty of either $1.00 for each unit of production produced 
and sold by the Company or eight percent (8%) of any royalty the Company 
should receive from third party licensees that utilize the DSS Technology.  
Due to the relationship of Mr. Steinke and Mr. Chrobak with the Company, the 
DSS License Agreement cannot be considered to have been negotiated at arm's 
length.

     Airless Tire License Agreement

     On October 27, 1995, the Company entered into a technology license 
agreement (the "Airless Tire License Agreement") with AMS.  AMS is the owner 
of certain technology for producing an airless tire for which an application 
for United States Letters Patent has been filed and is currently pending.   
The Airless Tire License Agreement grants the Company an exclusive license to 
use, sell, license, or otherwise exploit the technology worldwide in exchange 
for a royalty of $0.25 for each bicycle tire produced and sold by the Company 
utilizing the technology.  Due to the relationship of Mr. Steinke and Mr. 
Chrobak with the Company, the Airless Tire License Agreement cannot be 
considered to have been negotiated at arm's length.

     Stock Subscriptions

     In April 1995, the Company entered into subscription agreements with Gary 
Dalton, Philip Chrobak, and David Griffiths, three of its Officers, to acquire 
an aggregate of 170,000 shares of its Common Stock at a purchase price of 
$1.00 per share, in exchange for promissory notes bearing interest at 8% per 
annum, payable in 36 months.  The promissory notes were subsequently amended 
to become due on April 10, 1997. The Company has adopted a policy that any 
future loans or similar arrangements to its officers, directors, or 5% 
shareholders will not occur unless approved by a majority of the disinterested 
directors and for a bona fide business purpose.  Set forth below are the names 
of the Officers, the number of shares issued, the consideration to be received 
for such shares, and their relationship with the Company.
PAGE
34

                        Number of      Consideration  Balance   Relationship
Name of Shareholder     Shares Issued  to be Paid     Due (3)   to the Company
-------------------     -------------  -------------  -------   --------------

Gary Dalton (1)            100,000       $100,000     $40,000   Former Officer
Philip J. Chrobak (2)       50,000         50,000      45,000   Former Officer
David Griffiths             20,000         20,000       -0-     Officer
                           -------       --------     -------
Totals                     170,000       $170,000     $85,000
                           =======       ========     =======

(1)  As of March 31, 1997, Mr. Dalton had paid $50,000 cash and provided 
services to the Company valued at $10,000, which amounts have been applied 
against the principal and interest to be paid under the promissory note.

(2)  As of March 31, 1997, Mr. Chrobak has provided services to the Company 
valued at $5,000, which amount has been applied against the principal and 
interest to be paid under the promissory note.

(3)  Amount due does not include any accrued interest.

DESCRIPTION OF CAPITAL STOCK

Common Stock

     The Company's Articles of Incorporation authorize 25,000,000 shares of 
Common Stock, $0.001 par value per share.  The shares of Common Stock have no 
preemptive or other subscription rights, have no conversion rights, and are 
not subject to redemption.  All shares of Common Stock will be, when and if 
issued, fully paid and nonassessable.  No personal liability will attach to 
the ownership thereof.  The holders of Common Stock are entitled to one vote 
for each share held.  The Common Stock has noncumulative voting rights.

Preferred Stock

     The Company's Articles of Incorporation authorize 5,000,000 shares of 
Preferred Stock, $0.001 par value per share (the "Preferred Stock").  The 
authority to issue the Preferred Stock is vested in the Board of Directors, 
which has authority to fix and determine the powers, qualifications, 
limitations, restrictions, designations, rights, preferences, or other 
variations of each class or series within each class which the Company is 
authorized to issue.  The above described authority of the Board of Directors 
to fix and determine may be exercised by corporate resolution from time to 
time as the Board of Directors sees fit.

Shares Eligible for Future Sale

     The Company has 4,546,748 shares of Common Stock issued and outstanding.  
All of the 155,000 shares of Common Stock registered to be sold by Selling 
Shareholders will be freely transferable by persons other than "affiliates" of 
the Company, as that term is defined under the Securities Act, without further 
registration under the Securities Act.
PAGE
35

     The Company has previously issued shares of Common Stock that constitute 
"restricted securities" as that term is defined in Rule 144 adopted under the 
Securities Act.  Subject to certain restrictions, such securities may 
generally be sold in limited amounts two years after their acquisition.     
The Commission has recently adopted a proposal to reduce the holding period 
prior to which shares may be eligible for resale under Rule 144 from two years 
to one year.  The amendments to Rule 144 take effect April 29, 1997 and once 
effective, the rule will allow the above mentioned restricted securities to be 
eligible for resale one year earlier. 

     The Company issued 2,510,000 shares of Common Stock to initial 
Shareholders in connection with its organization.  The Company issued an 
additional 300,000 shares of Common Stock to various individuals for professiona
l and consulting services during February 1995.  In April 1995, the Company 
issued 170,000 shares to certain Officers and 100,000 shares for professional 
services.  In May 1995, the Company issued 720,000 shares in a private 
placement.  The shares issued to insiders (2,510,000 shares to founders and 
170,000 shares to other Officers) are currently eligible for resale under Rule 
144.  However, in connection with the Company's initial public offering, the 
Company's Officers, Directors, and Shareholders owning more than 5% of the 
Company's issued and outstanding shares of Common Stock agreed not to sell any 
shares owned directly or indirectly by them for a period of up to four years, 
subject to the Company obtaining certain net earnings requirements.

     The 400,000 shares of Common Stock issued to consultants for professional 
services in February and April 1995 were issued pursuant to an exemption from 
registration available under Rule 701 of the Securities Act, and are now 
eligible for resale pursuant to the resale limitations set forth in Rule 
701(c) which provides that 90 days after the Company becomes subject to the 
reporting requirements of Section 13 or Section 15(d) of the Securities 
Exchange Act of 1934 (i.e., May 28, 1996), securities issued in a Rule 701 
transaction may be resold by persons other than affiliates in reliance on Rule 
144, without compliance with (1) current information, (2) holding period, (3) 
volume limitation, and (4) notice requirements of Rule 144; and by affiliates 
without compliance with the holding period requirements of Rule 144.

     The 720,000 shares of restricted Common Stock sold by the Company in the 
May 1995 will become eligible for sale under Rule 144 in May 1997. Sales of 
these restricted securities under Rule 144 or otherwise may have a depressive 
effect on the price of the Company's Common Stock in any trading market that 
may develop following this Offering.  After the implementation of the 
amendment to Rule 144, securities held for two years may be sold by 
nonaffiliates without limitation.  See PRINCIPAL SHAREHOLDERS and DESCRIPTION 
OF CAPITAL STOCK. 

     The Company is unable to estimate the total number of shares that may be 
sold in the future by its existing Shareholders or the effect, if any, that 
sales of shares by such Shareholders will have on the market price of the 
Common Stock prevailing from time to time.  Sales of substantial amounts of 
Common Stock by existing Shareholders could adversely affect prevailing market 
prices.

PAGE
36 

Dividend Policy

     The holders of Common Stock are entitled to dividends when, and if, 
declared by the Board of Directors from funds legally available therefor, 
subject to any preference on preferred stock, if applicable, which may then be 
outstanding.  The Company has not paid a dividend since its incorporation.  
Because the Company is in the formative stage and will be engaged in start-up 
operations for the next several years, it is not anticipated that funds will 
be available for the issuance of dividends in the foreseeable future.

Transfer and Warrant Agent

     The Company's transfer agent is Interwest Transfer Company, 1981 East 
Murray-Holladay Road, Holladay, Utah  84117, Telephone (801) 272-9294.

LITIGATION

     The Company is not a party to any pending legal proceedings and no such 
action by or against it, to the best of its knowledge, has been threatened.

LEGAL MATTERS

     Taylor and Associates, Inc., Attorneys and Counselors at Law, Salt Lake 
City, Utah,  counsel to the Company, will render an opinion that the Common 
Stock being offered hereby, has been fully paid and nonassessable under the 
corporate laws of the state of Nevada.

EXPERTS

     The financial statements included herein and elsewhere in this 
Registration Statement, to the extent and for the periods indicated in its 
report, have been included in this Prospectus and the Registration Statement, 
in reliance on the report of Saltz, Shamis & Goldfarb, Inc., Certified Public 
Accountants, Akron, Ohio, given on the authority of said firm as experts in 
accounting and auditing.

ADDITIONAL INFORMATION

     The Company has filed this Registration Statement on Form S-1 under the 
Securities Act with the Commission with respect to the securities offered by 
this Prospectus.  This Prospectus omits certain information contained in the 
Registration Statement.  For further information, reference is made to the 
Registration Statement and to the exhibits and other schedules filed 
therewith.  Statements contained in this Prospectus as to the contents of any 
contract or other document referred to are not necessarily complete, and where 
such contract or document is an exhibit to the Registration Statement, each 
such statement is deemed to be qualified and amplified in all respects by the 
provisions of the exhibit.  Copies of the complete Registration Statement, 
including exhibits, may be examined without charge at the Commission's 
principal offices in Washington, D.C., and copies of all or any part of the 
filed materials may be obtained from the Public Reference Section of the 
Commission, at 450 Fifth Street, N.W., Washington, D.C.  20549, on payment the 
ususal fees for reproduction.

PAGE
37

FINANCIAL STATEMENTS

INDEX TO FINANCIAL STATEMENTS

Title to Document                                                         Page
-----------------                                                         ----

Independent Auditor's Report of Saltz, Shamis & Goldfarb, Inc.             38

Balance Sheets as of June 30, 1996 and 1995                                39

Statements of Operations for the year ended June 30, 1996 and
the period from January 30, 1995 (inception) to June 30, 1996
and 1995                                                                   41

Statements of Shareholders' Equity for the year ended June 30,
1996 and the period from January 30, 1995 (inception) to June
30, 1996 and 1995                                                          42

Statements of Cash Flows for the year ended June 30, 1996 and
for the period from January 30, 1995 (inception) to June 30,
1996 and 1995                                                              43

Notes to Financial Statements                                              44

                                            
Balance Sheet at June 30, 1996 and December 31, 1996 (Unaudited)           50

Statements of Operations for the three months ended December
 31, 1996 and 1995, for the six months ended December 31, 1996
 and 1995 and from January 30, 1995 (Inception) to December 31,
 1996 (Unaudited)                                                          52

Statements of Shareholders' Equity for the Period from January 30,
 1995 (Inception) to December 31, 1996 (Unaudited)                         53

Statements of Cash Flows for the three months ended December 31,
 1996 and 1995, for the six months ended December 31, 1996 and
 1995 and from January 30, 1995 (Inception) to December 31, 1996
 (Unaudited)                                                               54

Notes to the Financial Statements                                          55

PAGE
38

INDEPENDENT AUDITOR'S REPORT

To the Shareholders and Board of Directors
of American Tire Corporation

We have audited the accompanying balance sheets of American Tire Corporation 
(a development stage company) as of June 30, 1996 and 1995, and the related 
statements of operations, shareholders' equity, and cash flows for the year 
ended June 30, 1996 and for the period from January 30, 1995 (inception) to 
June 30, 1996 and 1995.  These financial statements are the responsibility of 
the Company's management.  Our responsibility is to express an opinion on 
these financial statements based on our audit.

We conducted our audits in accordance with generally accepted auditing 
standards.  Those standards require that we plan and perform the audits to 
obtain reasonable assurance about whether the financial statements are free of 
material misstatement.  An audit includes examining, on a test basis, evidence 
supporting the amounts and disclosures in the financial statements.  An audit 
also includes assessing the accounting principles used and significant 
estimates made by management, as well as evaluating the overall financial 
statement presentation.  We believe that our audits provide a reasonable basis 
for our opinion.

In our opinion, the financial statements referred to above present fairly, in 
all material respects, the financial position of American Tire Corporation as 
of June 30, 1996 and 1995, and the results of its operations and its cash 
flows for the year ended June 30, 1996 and for the period from January 30, 
1995 (inception) to June 30, 1996 and 1995, in conformity with generally 
accepted accounting principles.

The accompanying financial statements have been prepared assuming the company 
will continue as a going concern.  As described in Note A to the financial 
statements, the Company's ability to bring its product to market are dependent 
on its successful obtainment of capital to fund its activities.  In the event 
the Company is unsuccessful in obtaining sufficient capital, there is 
substantial doubt about the Company's ability to continue as a going concern.  
The financial statements do not include any adjustments that might result from 
the outcome of this uncertainty.

/S/ SALTZ, SHAMIS & GOLDFARB, INC.

Akron, Ohio
October 9, 1996
39

AMERICAN TIRE CORPORATION
(A Development Stage Company)
BALANCE SHEETS
JUNE 30, 1996 AND 1995
ASSETS
                                             1996        
1995                                                            ---------    
---------
CURRENT ASSETS:
 Cash                                   $    4,467   $   92,729
 Other receivables                          22,767        4,419
 Receivable - officers                        -          50,000
 Inventory                                 131,285         -
 Prepaid royalties - related party          17,725        8,550
 Prepaid expenses                           15,182       19,563
 Deposits on inventory                      87,401      201,838
                                         ---------    ---------
 Total Current Assets                      278,827      377,099
                                         ---------    ---------
PROPERTY, PLANT AND EQUIPMENT
 Land                                       59,000       59,000
 Building and building improvements        229,996      228,305
 Equipment                                 225,968       73,906
 Furniture and fixtures                      7,692        6,940
 Construction in progress                     -          14,000
                                         ---------    ---------
                                           522,656      382,151
  Less: accumulated depreciation            39,299        1,305
                                         ---------    ---------
                                           483,357      380,846
OTHER ASSETS:
 Deposits                                    1,834        1,854
 Accrued interest receivable                 9,993        2,991
 Deferred offering costs                   147,108       71,824
                                         ---------    ---------
                                           158,935       76,669 
                                         ---------    ---------
                                        $  921,119   $  834,614
                                         =========    =========
(See accompanying notes to the financial statements)
40
AMERICAN TIRE CORPORATION
(A Development Stage Company)
BALANCE SHEETS
JUNE 30, 1996 AND 1995
LIABILITIES AND SHAREHOLDERS' EQUITY

                                             1996        
1995                                                            ---------    
---------
CURRENT LIABILITIES:
 Line of credit                         $   299,838  $  201,838
 Accounts payable and accrued expenses       98,680      24,908
 Due to officer                                -          6,159
 Notes payable - officers and
  accrued interest                          265,830        -
                                         ----------   ---------
 Total Current Liabilities                  664,348     232,905

SHAREHOLDERS' EQUITY:
 Preferred stock, par value $0.001,
  5,000,000 shares authorized,
  0 shares issued and outstanding              -           -
 Common stock $.001 par value, 25,000,000 
  shares authorized, 3,840,642 and 
  3,800,000 shares issued and outstanding,
  respectively                                3,841       3,800
 Additional paid-in capital               1,182,650     940,439
 Deficit accumulated during the 
  development stage                        (844,720)   (248,630)
                                          ---------   ---------  
                                            341,771     695,609
 Less: Receivable - shareholder (officers)  (85,000)    (93,900)
                                          ---------   ---------
                                            256,771     601,709
                                          ---------   ---------
                      
                                        $   921,119  $  834,614
                                         ==========   =========
(See accompanying notes to the financial statements)
41

AMERICAN TIRE CORPORATION 
(A Development Stage Company)

STATEMENTS OF OPERATIONS
January 30, 1995
                                                         For the    January 
30, 1995  (Inception)   
                                                       Year Ended     
(Inception)          to
                                                        June 30,     to June 
30,        June 30, 
                                                           1996           
1995             1996      
                                                      ------------   
------------    ------------
INCOME
 Interest income                                      $      8,161   $      
3,611    $     11,772
                                                      ------------   
------------    ------------
EXPENSES:
 Consulting                                                 43,261        
135,818         179,079
 Payroll and payroll taxes                                 222,757         
29,817         252,574
 Administrative                                            190,864         
28,126         218,990
 Travel and entertainment                                   55,554         
40,774          96,328
 Marketing consulting                                         -            
13,300          13,300
 Interest                                                   53,821          
3,101          56,922
 Depreciation                                               37,994          
1,305          39,299 
                                                      ------------   
------------    ------------
    Total Expenses                                         604,251        
252,241         856,492
                                                      ------------   
------------    ------------
LOSS BEFORE INCOME TAXES                                  (596,090)      
(248,630)       (844,720)

 Income taxes                                                 -              
-              -     
                                                      ------------   
------------    ------------
NET LOSS                                              $   (596,090)  $   
(248,630)   $   (844,720)
                                                      ============   
============    ============

WEIGHTED AVERAGE SHARES OUTSTANDING                      3,840,642      
3,800,000       3,840,642
                                                      ============   
============    ============

NET LOSS PER SHARE                                    $      (0.16)  $      
(0.06)   $      (0.22)
                                                      ============     
==========    ============
(See accompanying notes to the financial statements)
42
AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENT OF SHAREHOLDERS' EQUITY
FROM THE DATE OF INCEPTION (JANUARY 30, 1995) TO JUNE 30, 1996
Accumulated
                                                            Deficit    
                                                 Additional During         
Notes         Total
                              Common Stock        Paid-in   Development   
Receivable   Shareholders'
                            Shares      Amount    Capital   Stage        
Shareholders    Equity
                          ----------  ---------  ---------  -----------  
------------  -------------
BALANCE, January 30, 1995
 (Inception)                    -     $    -     $     -     $     -     
$       -     $       -

Sale of common stock for
 cash of $.01 per share    2,510,000      2,510        -           
-             -            2,510

Common stock issued for
 services in February
 1995                        300,000        300      29,700        
-             -           30,000

Common stock issued for
 services in April 1995      100,000        100      99,900        
-             -          100,000

Common stock issued for
 notes receivable, of 
 which $50,000 was paid
 in August 1995 and
 $50,000 included in
 current assets at June
 30, 1995                    170,000        170     169,830        -         
(120,000)       50,000

Repayment of notes
 receivable by providing
 services                       -          -           -           -           
26,100        26,100

Sale of common stock for
 cash of $1.00 per share
 pursuant to a private
 placement, net of stock
 issuance costs of $78,271   720,000        720     641,009        
-             -          641,729

Net loss for the period         -          -           -       
(248,630)         -         (248,630)
                          ----------  ---------  ----------  ----------  
------------  ------------ 
Balance at June 30, 1995   3,800,000      3,800     940,439    (248,630)      
(93,900)      601,709

Repayment of notes
 receivable by providing
 services                       -          -           -           
-            8,900         8,900

Sale of common stock for
 cash of $6.00 per share
 pursuant to a private
 placement                    40,642         41     243,811        
-            -           243,852

Stock issuance costs            -          -         (1,600)       
-            -            (1,600)

Net loss for the year           -          -           -       
(596,090)        -          (596,090)
                          ----------  ---------  ---------- -----------  
-----------   ------------ 
Balance at June 30, 1996   3,840,642  $   3,841  $1,182,650 $  (844,720) $   
(85,000)  $    256,771
                          ==========  =========  ========== ===========  
===========   ============
(See accompanying notes to the financial statements)
43
AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
January 30, 1995
                                                         For the   January 30, 
1995  (Inception)   
                                                       Year Ended     
(Inception)          to  
                                                        June 30,     to June 
30,        June 30,
                                                          1996           
1995             1996     
                                                      ------------   
------------    ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net loss                                             $   (596,090)  $   
(248,630)   $   (844,720)

 Adjustments to reconcile net loss to net cash
  used by operating activities:
    Depreciation                                            37,994          
1,305          39,299
    Stock issued in lieu of cash payment for
     certain services                                         -           
129,000         129,000
    Services provided in lieu of cash payment
     on receivables - officers                               8,900         
26,100          35,000
  (Increase) decrease in:
     Other receivables                                     (18,348)        
(4,419)        (22,767)
     Inventory                                            (131,285)          
-           (131,285)
     Prepaid royalties                                      (9,175)        
(8,550)        (17,725)
     Prepaid expenses                                        4,381        
(19,563)        (15,182)
     Deposits on inventory and other                       114,457       
(203,692)        (89,235)
     Accrued interest receivable                            (7,002)        
(2,991)         (9,993)
  Increase (decrease) in:
     Accounts payable and accrued expenses                  78,602         
24,908         103,510
     Due to officer                                         (6,159)         
6,159            -  
                                                      ------------   
------------    ------------
NET CASH USED BY OPERATING ACTIVITIES                     (523,725)      
(300,373)       (824,098)

CASH FLOWS FROM (USED) IN INVESTING ACTIVITIES:
     Purchase of property, plant and equipment            (140,505)      
(382,151)       (522,656)
                                                      ------------   
------------    ------------
NET CASH USED BY INVESTING ACTIVITIES                     (140,505)      
(382,151)       (522,656)

CASH FLOWS FROM FINANCING ACTIVITIES:
     Borrowing on line of credit                           196,000        
201,838         397,838
     Repayment on line of credit                           (98,000)          
-            (98,000)
     Proceeds from notes payable - officers                267,000           
-            267,000
     Repayment of notes payable - officers                  (6,000)          
-             (6,000)
     Proceeds from mortgage note payable                      -           
188,000         188,000
     Repayment of mortgage note payable                       -          
(188,000)       (188,000)
     Proceeds from issuance of common stock
      (net of stock issuance costs of $79,871)             292,252        
644,239         936,491
     Deferred offering costs                               (75,284)       
(70,824)       (146,108)
                                                      ------------   
------------    ------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                  575,968        
775,253       1,351,221
                                                      ------------   
------------    ------------
NET INCREASE (DECREASE) IN CASH                            (88,262)        
92,729           4,467

CASH AT BEGINNING OF PERIOD                                 92,729           
-               -   
                                                      ------------     
----------    ------------
CASH AT END OF PERIOD                                 $      4,467     $   
92,729    $      4,467
                                                      ============     
==========    ============
(See accompanying notes to the financial statements)
44
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------- 

NATURE OF BUSINESS: American Tire Corporation, a Nevada corporation ("the 
Company"), was organized on January 30, 1995, to take advantage of existing 
proprietary and non-proprietary technology available for the manufacturing of 
specialty tires.  The Company has had limited operations since its 
organization and is a "development stage" company.  The Company intends to 
engage in the manufacturing, marketing, distribution, and sales of airless 
"specialty" tires and tire-wheel assemblies utilizing "liquid phase" 
technology.  Initially, the Company will manufacture airless bicycle tires at 
the Company manufacturing facility located in Ravenna, Ohio.  The Company's 
year end is June 30.

BASIS OF PRESENTATION:  The accompanying financial statements have been 
prepared on a going concern basis, which contemplates the realization of 
assets and the satisfaction of liabilities in the normal course of business.  
The Company has a very limited operating history, has not generated operating 
revenues to date and must be considered promotional and in its early 
development stages.

Through an initial public offering the Company is offering at a cash price of 
$6.00 per share, up to 550,000 shares (250,000 share minimum) of the Company's 
common stock.  The Company's continuation as a going concern is dependent upon 
its ability to generate sufficient capital resources from its initial public 
offering or other sources to carry out its business plan and to commence and 
continue operations.

REVENUE RECOGNITION:  The Company expects to recognize revenue upon the 
shipment of product.

INVENTORY:  Inventory is stated at the lower of cost or market, using the 
first-in, first-out method.  The inventory at June 30, 1996 consists of 
finished goods purchased for resale.

PROPERTY, PLANT AND EQUIPMENT:  Property, plant and equipment are recorded at 
cost.  Depreciation is provided using the straight-line method over the 
estimated useful lives of the assets, as follows:

          Building                    40 years
          Equipment                    5 years
          Furniture and fixtures       7 years

INCOME TAXES: Deferred tax assets and liabilities are recognized for the 
expected future tax consequences of events that have been recognized in the 
financial statements and tax returns.  The Company has provided a 100% 
valuation allowance for the benefit associated with the Company's net 
operating loss carryforward of approximately $856,000 and $246,000 at June 30, 
1996 and June 30, 1995, respectively.

DEFERRED OFFERING COSTS:  The initial public offering costs have been deferred 
pending completion of such offering at which time such costs will be netted 
against the offering proceeds received.  Should the offering be unsuccessful, 
these costs will be expensed.
45
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
---------------------------------------------------------------

NET LOSS PER SHARE: The net loss per share has been computed in accordance 
with regulations of the Securities and Exchange Commission.  Accordingly, 
stock issued at prices less than the proposed offering price within one year 
of the offering have been treated as outstanding for the period presented in 
the accompanying statements of operations.

CONCENTRATIONS OF CREDIT RISK: Financial instruments that potentially subject 
the Company to concentrations of credit risk consist principally of temporary 
cash investments.  The Company places its temporary cash investments with 
financial institutions and, although at times during 1996 they had balances in 
excess of federal insurance limits, management does not feel the Company is 
exposed to substantial credit risk.

RECENT PRONOUNCEMENTS: In March 1995, the FASB issued Statement No. 121 (SFAS 
121), "Accounting for the Impairment of Long-Lived Assets and for Long-Lived 
Assets to be Disposed of." SFAS 121 becomes effective for fiscal years 
beginning after December 15, 1995 and addresses the accounting for the 
impairment of long-lived assets, certain identifiable intangibles, and 
goodwill related to those assets to be held and used for long-lived assets and 
certain identifiable intangibles to be disposed of.  The Company believes this 
pronouncement will not have a significant impact on the Company's financial 
statements. 

USE OF ESTIMATES:  Management uses estimates and assumptions in preparing 
these financial statement in accordance with generally accepted accounting 
principles.  Those estimates and assumptions affect the reported amounts of 
assets and liabilities, the disclosure of contingent assets and liabilities, 
and the reported revenues and expenses.  Actual results could vary from the 
estimates that were used.

NOTE B - RECEIVABLES - OFFICERS
-------------------------------

In April 1995, the Company entered into subscription agreements for three of 
its officers to acquire an aggregate of 170,000 shares of common stock at a 
purchase price of $1.00 per share, in exchange for promissory notes bearing 
interest at 8% per annum, principal and interest payable in April 1998.  The 
officers provided accounting and consulting services valued at $26,100 which 
have been charged to operations during the period ended June 30, 1995, and 
offset against the amount owed under the promissory notes.  At June 30, 1995, 
the total amount receivable was $143,900, of which $50,000 was classified as a 
current asset. This represents cash received after June 30, 1995, but prior to 
issuance of the financial statements, with the remaining $93,900 reflected as 
a reduction of shareholders' equity, as the receivable was not settled prior 
to the issuance of the financial statements.  At June 30, 1996 and 1995, 
accrued interest receivable on these notes amounted to $9,993 and $2,991, 
respectively.  The promissory notes were amended to become due no later than 
six months from the close of the Company's initial public offering.

During the year ended June 30, 1996, an officer provided $8,900 of accounting 
services, which were offset against the amounts owed under the promissory 
note, and another officer paid $50,000 toward his note receivable.  At June 
30, 1996, $85,000 was owed under these notes, which has been presented as a 
reduction of shareholders' equity.
46
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

NOTE C - TECHNOLOGY LICENSE AGREEMENT
-------------------------------------

On June 5, 1995, the Company entered into a technology licensing agreement 
with a related company owned by certain shareholders of the Company.  This 
agreement provides the Company the exclusive license to use, sell and license 
the technology for manufacturing a wheel-tire assembly known as the "Dynamic 
Steerable Spring".  The agreement specifies that a royalty of either $1.00 per 
unit sold directly by the Company or 8% percent of any royalty the Company 
should receive from any third party licensee to be paid quarterly.  At June 
30, 1996 and June 30, 1995, $17,725 and $8,550, respectively, have been  
advanced pursuant to and in anticipation of this agreement and is recorded in 
prepaid royalties.

NOTE D - DEPOSITS ON INVENTORY
------------------------------

At June 30, 1995, the Company had deposited $201,838 for purchase of bicycle 
tires.  This amount is recorded as a deposit on the June 30, 1995 balance 
sheet.  As of June 30, 1996, inventory of $114,437 has been received.  The 
remaining tires are expected to be received upon the availability of such 
tires from the manufacturer after the completion of the initial public 
offering.  In the event the manufacturer is unable to provide the tires, the 
manufacturer will refund such deposit to the Company.

NOTE E - LINE OF CREDIT
-----------------------

The Company has entered into a line of credit agreement with a bank.  Under 
the terms of the agreement, the Company may borrow up to $300,000 at the 
interest rate of prime plus 1%.  This line is personally guaranteed either 
entirely or in part by the Chief Executive Officer and the President of the 
Company and is secured by the accounts receivable, inventory and equipment of 
the Company.  At June 30, 1996 and 1995, $299,838 and $201,838, respectively 
was outstanding under this agreement.          

The weighted average interest rate during the year ended June 30, 1996 and the 
period ended June 30, 1995 was 9.71% and 10%, respectively.

NOTE F - INCOME TAXES
---------------------

The Company's total deferred tax asset, deferred tax liability and valuation 
allowance at June 30, 1996 and 1995 is:

                                         1996                  1995
                                        --------              --------
Total deferred tax asset                $308,000              $ 78,600
Total deferred tax liability              (7,400)                 -
Valuation allowance for deferred taxes  (300,600)              (78,600)
                                        --------              --------
  Deferred taxes, net                   $   -                 $   -
                                        ========              ========   

The deferred tax asset results from net operating loss carryforwards of 
approximately $856,000 and $246,000 at June 30, 1996 and 1995, respectively,
47
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

which begin to expire in 2010.  The deferred tax liability results from the 
use of accelerated methods of depreciation for tax purposes.

NOTE G - SHAREHOLDERS' EQUITY
-----------------------------

Shareholders' equity is comprised of the following at June 30, 1996 and 1995:

PREFERRED STOCK: The Company has authorized 5,000,000 shares of $.001 par 
value preferred stock.  At June 30, 1996 and 1995, no shares of preferred 
stock were issued or outstanding, respectively.

COMMON STOCK: The Company was initially capitalized by issuing 2,510,000 
shares of $.001 par value common stock in exchange for a stock subscription 
receivable in lieu of cash.  The stock subscription receivable was paid on 
June 30, 1995.

In February 1995, the Company issued 300,000 shares of $.001 par value common 
stock to certain individuals in lieu of cash payments for consulting services 
provided to the Company by such individuals valued at $30,000.  $29,000 has 
been charged to operations during the period ended June 30, 1995.  $1,000 has 
been capitalized and is included in deferred offering costs at June 30, 1996 
and 1995.

In April 1995, the Company issued 100,000 shares of $.001 par value common 
stock to the spouses of two officers of the Company in lieu of cash payment 
for consulting services provided to the Company by such individuals.  The 
Company's management has charged $100,000 to operations for the period ended 
June 30, 1995 for the services provided.

In April 1995, the Company entered into subscription agreements with three of 
its officers for them to acquire an aggregate of 170,000 shares of $.001 par 
value common stock at a purchase price of $1.00 per share, in exchange for 
promissory notes bearing interest at 8% per annum, payable in April, 1998 (See 
Note B).

In May 1995, pursuant to a private placement, the Company issued 720,000 
shares of $.001 par value common stock for $1.00 per share, which resulted in 
proceeds of $720,000.  Stock issuance costs associated with this private 
placement amounted to $79,871.

In September 1995, pursuant to a private placement, the Company issued 40,642 
shares of $.001 par value common stock for $6.00 per share, which resulted in 
proceeds of $243,852.

NOTE H - RELATED PARTY TRANSACTIONS
-----------------------------------

The land and building of the Company were acquired personally by an officer of 
the Company for $287,305.  The officer was subsequently reimbursed at his cost 
upon transfer of the title of the land and building to the Company.
48
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

In August, 1995, the Company entered into employment agreements with two of 
its officers, which will not take effect until the proceeds of the initial 
public offering have been received by the Company.  The agreements are for 36 
months at a monthly compensation of $10,000 each upon the consummation of the 
proposed public offering.

In October 1995, the Company entered into an agreement with a related company 
providing for a royalty of $.25 to be paid for each tire sold by the Company 
utilizing the "airless tire technology" as defined by the agreement.

From February 1996 to June 1996, certain officers loaned the Company a total 
of $261,000.  These notes are due on demand and bear interest at rates ranging 
from 9.25% to 9.5% per annum.  At June 30, 1996, accrued interest amounted to 
$4,830 and is included with the notes payable - officers on the balance 
sheet.  The Company intends to repay a portion, if not all, of these loans 
from the proceeds of the initial public offering.

In June 1996, the Company revised the promissory notes from certain officers 
of the Company (see Note B) to be due no more than six months from the closing 
date of the Company's initial public offering, rather than in April 1998.

NOTE I - COMMITMENTS AND CONTINGENCIES
--------------------------------------

As of June 30, 1995, the Company has entered into agreements to purchase 
manufacturing equipment totaling $27,780.  Deposits of $14,000 had been paid 
on these commitments and are included in construction in progress.  Payment in 
full on this agreement was made during the year ended June 30, 1996, and is 
included in equipment at June 30, 1996.

In April 1995, the Company entered into a television commercial agreement to 
air an advertising commercial produced for the Company for a one year period 
beginning as soon as the airless bicycle tires are available for shipment.   
During this period, the Company will pay $2 for each bicycle tire sold through 
its retail customers.  The agreement can be extended for an additional year 
upon the agreement of both parties.

In July 1995, the Company entered into a Trade Mark License agreement which 
grants the Company the exclusive right to use the licensor's trade mark 
"Urathon" in the territory, as defined by the agreement.  The Company shall 
pay the licensor a royalty of $.35 per airless bicycle tire sold during the 
term of the agreement, which expires on December 31, 2005.

In August 1995, the Company entered into a consulting agreement with an 
individual for a one year period, subject to one year renewals, which provides 
for monthly payments of $3,000.  The consulting agreement was terminated on 
July 31, 1996.

Due to the timing of the Company's September 1995 private placement during the 
pendency of the Company's registration statement, the Company's reliance on an 
exemption from registration could possibly be challenged.  The Company has 
offered to repurchase such shares sold in the September 1995 private placement 
at the price originally paid plus interest at a 12% annual interest rate from 
the date of original purchase through the date of the repurchase of such 
shares.  At June 30, 1996, the Company estimates its obligation to such 
shareholders, if all shareholders request the Company to reaquire all 40,642
49
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS

shares, at $265,788.  Payment of such obligation of the Company has been 
personally guaranteed by the Chief Executive Officer and the President of the 
Company.  Included in accounts payable and accrued expenses at June 30, 1996, 
is $21,936 of accrued interest related to the shares of common stock subject 
to the recision offer.

NOTE J - SUPPLEMENTAL CASH FLOW INFORMATION
-------------------------------------------

During the year ended June 30, 1996 and the period ended June 30, 1995, cash 
paid for interest amounted to $26,654 and $1,828, respectively.

In February 1995, the Company issued 300,000 shares of common stock in lieu of 
cash payment for consulting services valued at $30,000 of which $29,000 was 
charged to operations during the period ended June 30, 1995, and $1,000 was 
included in deferred offering costs.

In April 1995, the Company issued 170,000 shares of stock at $1.00 per share 
in exchange for notes receivable.  During the period ended June 30, 1995, 
services were provided valued at $26,100, which were offset against the notes 
receivable.  During the year ended June 30, 1996, an additional $8,900 of 
services were provided, which were offset against the notes receivable.

Additionally, in April 1995, the Company issued 100,000 shares of common stock 
in lieu of cash payment for consulting services valued at $100,000 provided by 
the spouses of two officers of the Company.

NOTE K - EVENTS SUBSEQUENT TO THE DATE OF THE REPORT OF INDEPENDENT AUDITOR
---------------------------------------------------------------------------
(UNAUDITED)
-----------

On October 10, 1996, the Company closed its initial public offering.  The 
Company received gross offering proceeds of $2,064,498 in exchange for the 
issuance of 344,083 shares of common stock.  In connection with the offering, 
shareholders owning 34,977 shares elected to accept the Company's recision 
offer and received an aggregate of $193,704.  This amount includes all accrued 
interest due them in connection with the recision offer.PAGE
50

AMERICAN TIRE CORPORATION
(A Development Stage Company)
BALANCE SHEETS
ASSETS
                                                  DECEMBER 31,
                                                     1996           JUNE 30,
                                                  (Unaudited)         1996
                                                 ------------     ------------
Current Assets:
     Cash.......................................   $  634,337      $    4,467
     Trade receivables..........................       26,570          22,767
     Accrued interest receivable................       13,420            -   
     Inventory..................................      131,285         131,285
     Prepaid royalties - related party..........       17,725          17,725
     Prepaid expenses                                  18,853          15,182
     Deposits on inventory......................       87,401          87,401 
                                                   ----------      ----------
          Total current assets..................      929,591         278,827
                                                   ----------      ----------
Property, Plant and Equipment
     Land.......................................       59,000          59,000
     Building and building improvements.........      233,570         229,996
     Equipment..................................      373,176         225,968
     Furniture and fixtures.....................        7,692           7,692
                                                   ----------      ----------
                                                      673,438         522,656
      Less: accumulated depreciation............       62,793          39,299
                                                   ----------      ----------
                                                      610,645         483,357
Other Assets:
     Deposits...................................        2,559           1,834
     Accrued interest receivable................         -              9,993
     Deferred offering costs....................         -            147,108
                                                   ----------      ----------
                                                        2,559         158,935
                                                   ----------      ----------
                                                   $1,542,795      $  921,119
                                                   ==========      ==========

(See accompanying notes to the financial statements)
51
AMERICAN TIRE CORPORATION
(A Development Stage Company)
BALANCE SHEETS (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY

                                                  DECEMBER 31,
                                                     1996           JUNE 30,
                                                  (Unaudited)         1996
                                                 ------------     ------------
Current Liabilities:
     Line of credit.............................   $     -         $  299,838
     Accounts payable and accrued expenses......       38,895          98,680
     Notes payable-officers and accrued interest         -            265,830
     Accrued payroll - officer..................       30,000            -
                                                   ----------      ----------
          Total current liabilities.............       68,895         664,348

Stockholder Equity:
     Preferred stock, par value $0.001,
      5,000,000 shares authorized, 0 shares
      issued and outstanding                             -               -
     Common stock, par value $0.001, 25,000,000
      shares authorized, 4,176,748 and 3,840,642
      shares issued and outstanding, respectively       4,177           3,841
     Additional paid-in capital..................   2,786,176       1,182,650
     Deficit accumulated during the
      development stage............. ............  (1,231,453)       (844,720)
                                                    ---------      ----------
                                                    1,558,900         341,771
      Less: Receivable-shareholder (officers)         (85,000)        (85,000)
                                                    ---------      ----------
                                                    1,473,900         256,771
                                                    ---------      ----------
                                                   $1,542,795      $  921,119
                                                   ==========      ==========
(See accompanying notes to the financial statements)
52
 AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENTS OF OPERATIONS 
(Unaudited)

                                                                                
             From
                                   For the Three                 For the 
Six             Inception on 
                                   Months Ended                  Months 
Ended             January 30,
                                   December 31,                  December 
31,            1995 through
                                 ------------------            
-------------------       December 31,
                                 1996          1995            1996           
1995           1996
                              ----------    ----------      ----------     
----------    ------------
REVENUE:                                             
 Interest income.............. $   5,763     $   2,117       $   7,480      
$   4,655     $  18,252
                               ---------     ---------       ---------      
---------     ---------
                                   5,763         2,117           
7,480          4,655        18,252
                               ---------     ---------       ---------      
---------     ---------
EXPENSES:
 Consulting...................      -            6,000            -            
14,000       179,079
 Payroll and payroll taxes....    43,814        50,356         110,317         
99,063       362,891
 Administrative...............   173,124        47,206         216,211         
95,453       435,201
 Travel and entertainment.....    15,187        18,427          21,023         
37,522       117,351
 Marketing consulting.........      -             -               
-              -           13,300
 Interest.....................       424         6,125          23,169         
12,800        80,091
 Depreciation.................    12,623         8,861          23,493         
16,230        62,792
                               ---------     ---------       ---------      
---------     ---------
     Total Expenses...........   245,172       134,859         394,213        
275,068     1,250,705
                               ---------     ---------       ---------      
---------     ---------
LOSS BEFORE INCOME TAXES......  (239,409)     (134,859)       (386,733)      
(270,413)   (1,231,453)

 Income taxes.................      -             -               
-              -             -
                               ---------     ---------       ---------      
---------     ---------

NET LOSS...................... $(239,409)    $(134,859)      $(386,733)     
$(270,413)  $(1,231,453)
                               =========     =========       =========      
=========     =========

NET LOSS PER SHARE............ $   (0.05)    $   (0.04)      $   (0.09)     
$   (0.07)    $   (0.30)
                               =========     =========       =========      
=========     =========

WEIGHTED AVERAGE SHARES
 OUTSTANDING.................. 4,176,748     3,840,642       4,118,480      
3,840,642     4,118,480
                               =========     =========       =========      
=========     =========
(See accompanying notes to the financial statements)
53
AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENTS OF SHAREHOLDERS' EQUITY
FROM THE DATE OF INCEPTION (JANUARY 30, 1995) TO DECEMBER 31, 1996
(UNAUDITED)
Accumulated
                                                            Deficit    
                                                 Additional During         
Notes         Total
                              Common Stock        Paid-in   Development   
Receivable   Shareholders'
                            Shares      Amount    Capital   Stage        
Shareholders    Equity
                          ----------  ---------  ---------  -----------  
------------  -------------
BALANCE, January 30, 1995
 (Inception).............       -     $    -     $     -     $     -     
$       -     $       -
Sale of common stock for
 cash of $.01 per share..  2,510,000      2,510        -           
-             -            2,510
Common stock issued for
 services in February
 1995....................    300,000        300      29,700        
-             -           30,000
Common stock issued for
 services in April 1995..    100,000        100      99,900        
-             -          100,000
Common stock issued for
 notes receivable, of 
 which $50,000 was paid
 in August 1995 and
 $50,000 included in
 current assets at June
 30, 1995................    170,000        170     169,830        -         
(120,000)       50,000
Repayment of notes
 receivable by providing
 services................       -          -           -           -           
26,100        26,100
Sale of common stock for
 cash of $1.00 per share
 pursuant to a private
 placement, net of stock
 issuance costs of
 $78,271.................    720,000        720     641,009        
-             -          641,729
Net loss for the period         -          -           -       
(248,630)         -         (248,630)
                          ----------  ---------  ----------  ----------  
------------  ------------ 
Balance at June 30, 1995   3,800,000      3,800     940,439    (248,630)      
(93,900)      601,709
Repayment of notes
 receivable by providing
 services................       -          -           -           
-            8,900         8,900
Sale of common stock for
 cash of $6.00 per share
 pursuant to a private
 placement...............     40,642         41     243,811        
-            -           243,852
Stock issuance costs.....       -          -         (1,600)       
-            -            (1,600)
Net loss for the year           -          -           -       
(596,090)        -          (596,090)
                          ----------  ---------  ---------- -----------  
-----------   ------------ 
Balance at June 30, 1996   3,840,642      3,841   1,182,650    (844,720)     
(85,000)       256,771
Purchase shares per
 recision offer..........    (34,977)       (35)   (209,827)       
-            -          (209,862)
Sale of common stock for
 cash of $6.00 per share
 pursuant to initial public
 offering (net of stock
 issuance cost of $34,200)   344,083        344   2,029,954        
-            -         2,030,298
Deferred offering costs..       -          -       (273,309)       
-            -          (273,309)
Common Stock issued for 
 debt at $2.10 per share.     27,000         27      56,708        
-            -            56,735
Net loss for period 
 ended December
 31, 1996................       -          -           -       
(386,733)        -          (386,733)
                          ----------  ---------  ---------- -----------  
-----------   ------------
Balance at December 31,
 1996                      4,176,748  $   4,177  $2,786,176 $(1,231,453) $   
(85,000)  $  1,473,900
                          ==========  =========  ========== ===========  
===========   ============
(See accompanying notes to the financial statements)
54
AMERICAN TIRE CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
From inception
                                                   FOR THE                    
FOR THE            On January 30,
                                             THREE MONTHS ENDED           SIX 
MONTHS ENDED        1995 through
                                                DECEMBER 31,                
DECEMBER 31,          December 31,
                                             1996          1995          
1996           1995          1996
                                         ------------  ------------  
------------   ------------  ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net loss................................$ (239,409)   $ (134,859)   $  
(386,733)   $  (270,413)  $(1,231,453)
Adjustments to reconcile net loss to net 
 cash used by operating activities:
  Depreciation...........................    12,623         8,861         
23,493         16,230        62,793
  Stock issued in lieu of cash payment for
   certain services......................      -             -              
-              -          129,000
  Services provided in lieu of cash payment
   on receivables - officers                   -            8,900           
-             8,900        35,000
 (Increase) decrease in:
  Other receivable.......................        65          (689)        
(3,803)        (1,024)      (26,570)
  Inventory..............................      -           (6,018)          
-          (131,285)     (131,285)
  Prepaid royalties......................      -           (4,940)          
-            (9,175)      (17,725)
  Prepaid expenses.......................    (6,454)       (6,292)        
(3,671)        (2,414)      (18,853)
  Deposits on inventory and other........      (180)         -              
(725)       114,437       (89,960)
  Accrued interest receivable............    (1,713)       (1,714)        
(3,427)        (3,612)      (13,420)
 Increase (decrease) in:
  Accounts payable and accrued expenses..    25,751        (4,001)       
(60,879)         4,527        38,895
  Due to officer.........................    30,000        (2,114)        
30,000         (8,159)       30,000
                                         ----------     ---------    
-----------    -----------   -----------
     Net cash used by
      Operating activities...............  (179,317)     (142,646)      
(405,745)      (279,988)   (1,232,578)
                                         ----------     ---------    
-----------    -----------   -----------
CASH FLOWS FROM (USED IN)
 INVESTING ACTIVITIES:
 Purchase of property, plant
  and equipment..........................  (148,681)      (17,713)      
(150,782)      (123,581)     (673,438)
                                         ----------     ---------    
-----------    -----------   -----------
     Net cash used by
      Investing activities...............  (148,681)      (17,713)      
(150,782)      (123,581)     (673,438)
                                         ----------     ---------    
-----------    -----------   -----------
CASH FLOWS PROVIDED BY
 FINANCING ACTIVITIES:
 Borrowing on line of credit.............      -           98,000           
-           196,000       397,838
 Repayment on line of credit.............      -          (98,000)      
(299,838)       (98,000)     (397,838)
 Proceeds from notes payable - officers..      -             -           
110,000           -          377,000
 Repayment of notes payable - officers...      -             -          
(317,000)          -         (323,000)
 Proceeds from mortgage note payable.....      -             -              
-              -          188,000
 Repayment of mortgage note payable......      -             -              
-              -         (188,000)
 Proceeds from issuance of
  common stock (net of stock
  issuance costs of $114,071)............   300,012       157,452      
2,030,298        292,252     2,969,524
 Purchase stock per recision offer.......      -             -          
(209,862)          -         (209,862)
 Deferred offering costs.................  (101,025)      (14,929)      
(127,201)       (31,981)     (273,309)
                                         ----------    ----------    
-----------    -----------   -----------
     Net cash provided by
      Financing activities...............   198,987       142,623      
1,186,397        358,271     2,540,353
                                         ----------    ----------    
-----------    -----------   -----------
NET INCREASE (DECREASE) IN CASH..........  (129,011)      (18,036)       
629,870        (45,298)      634,337

Cash at beginning of period..............   763,348        65,467          
4,467         92,729          -
                                         ----------    ----------    
-----------    -----------   -----------
Cash at end of period....................$  634,337    $  47,431     $   
634,337         47,431       634,337
                                         ==========    =========     
===========    ===========   ===========
(See accompanying notes to the financial statements)
55
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------- 

NATURE OF BUSINESS: American Tire Corporation, a Nevada corporation ("the 
Company"), was organized on January 30, 1995, to take advantage of existing 
proprietary and non-proprietary technology available for the manufacturing of 
specialty tires.  The Company has had limited operations since its organization 
and is a "development stage" company.  The Company is engaged in 
manufacturing, marketing, and distributing airless bicycle tires.  The 
Company's fiscal year end is June 30.

BASIS OF PRESENTATION:  The accompanying financial statements have been 
prepared on a going concern basis, which contemplates the realization of 
assets and the satisfaction of liabilities in the normal course of business.  
The Company has a very limited operating history, has not generated operating 
revenues to date and must be considered promotional and in its early 
development stages.

On October 10, 1996, the Company closed its initial public offering having 
sold 344,083 shares of common stock for aggregate offering proceeds of 
$2,064,498. The Company's continuation as a going concern is dependent upon 
its ability to utilize the working capital from its initial public offering to 
carry out its business plan and to commence and continue operations.

REVENUE RECOGNITION:  The Company expects to recognize revenue upon the 
shipment of product.

INVENTORY:  Inventory is stated at the lower of cost or market, using the 
first-in, first-out method.  The inventory at December 31, 1996 consists of 
finished goods purchased for resale.

PROPERTY, PLANT AND EQUIPMENT:  Property, plant and equipment are recorded at 
cost.  Depreciation is provided using the straight-line method over the 
estimated useful lives of the assets, as follows:

          Building                    40 years
          Equipment                    5 years
          Furniture and fixtures       7 years

NOTE B - RECEIVABLES - OFFICERS
-------------------------------

In April 1995, the Company entered into subscription agreements with three of 
its officers to acquire an aggregate of 170,000 shares of common stock at a 
purchase price of $1.00 per share, in exchange for promissory notes bearing 
interest at 8% per annum, principal and interest payable in April 1998. At 
December 31, 1996, accrued interest receivable on these notes amounted to 
$13,420. The promissory notes were amended to become due no later than six 
months from the close of the Company's initial public offering (April 10, 
1997). At December 31, 1996, $85,000 was owed under these notes, which has 
been presented as a reduction of shareholders' equity.

PAGE
56
AMERICAN TIRE CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)

NOTE C - TECHNOLOGY LICENSE AGREEMENT
-------------------------------------

On June 5, 1995, the Company entered into a technology licensing agreement 
with a related company owned by certain shareholders of the Company.  This 
agreement provides the Company the exclusive license to use, sell and license 
the technology for manufacturing a wheel-tire assembly known as the "Dynamic 
Steerable Spring".  The agreement specifies that a royalty of either $1.00 per 
unit sold directly by the Company or 8% percent of any royalty the Company 
should receive from any third party licensee to be paid quarterly.  At 
December 31, 1996, $17,725 has been advanced pursuant to and in anticipation 
of this agreement and is recorded in prepaid royalties.

NOTE D - RELATED PARTY TRANSACTIONS
-----------------------------------

On October 31, 1996, two of the Company's officers agreed to cancel 
approximately $56,827 in principal and accrued interest due them under certain 
promissory notes (See Note D) in exchange for the issuance of 27,000 shares of 
the Company's restricted common stock at an exchange valued at approximately 
$2.10 per share.

NOTE E - COMMITMENTS AND CONTINGENCIES
--------------------------------------

On November 11, 1996, the Company received a commitment for a line of credit 
of $500,000 from a commercial lender for working capital and equipment 
purchases.  The line of credit will bear an interest rate of 3/4% over prime 
and will be secured by the Company's accounts receivable, inventory, equipment 
and a first mortgage on the Company's Ravenna facility.

At the request of Dennis Chrobak, the Company's President, the Company has 
accrued his monthly employment compensation for October, November and December 
1996.  Mr. Chrobak has requested the Company to continue to accrue his monthly 
employment compensation until further notice.  In January 1997, the Company 
deposited $30,000 into a separate account  and will continue to deposit Mr. 
Chrobak's accrued employment compensation into this account until such time as 
the Company receives notice from Mr. Chrobak that he desires to receive it.

NOTE F - EVENTS SUBSEQUENT TO DECEMBER 31, 1996 
------------------------------------------------

On January 2, 1997, the Company entered into an Agreement in Principle with 
Coronel Investments Limited ("Coronel") to purchase all of Coronel's ownership 
interest in the capital stock of UTI Chemicals (Europe) Ltd., a United Kingdom 
company ("UTI"), engaged in the distribution of urethane tires in the United 
Kingdom and Europe.  The terms of the Agreement in Principle require the 
Company to issue 200,000 shares of its common stock and make a cash payment of 
$400,000 to Coronel and is subject to and conditioned upon the Company and 
Coronel entering into a definitive agreement with respect thereto. 
PAGE
57 BACK COVER

AMERICAN TIRE CORPORATION

155,000 Shares
Common Stock

PROSPECTUS
_________, 1997

No dealer, salesman or any other person has been authorized to give 
information or to make any representations other than those contained in this 
Prospectus, and, if given or made, such information or representation must not 
be relied upon as having been authorized by the Company. Neither the delivery 
of the Prospectus nor any sale made hereunder shall under any circumstances 
create any implication that there has been no change in the affairs of the 
Company since the date hereof.  This Prospectus does not constitute an offer 
to sell or the solicitation of an offer to buy any securities covered by this 
Prospectus in any state or other jurisdiction to any person to whom it is 
unlawful to make such offer in such state or jurisdiction.

Table of Contents
Section                                                                   Page
-------                                                                   ----
PROSPECTUS SUMMARY.........................................................
RISK FACTORS...............................................................
PLAN OF DISTRIBUTION.......................................................
SELLING SHAREHOLDERS.......................................................
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
 AND RESULTS OF OPERATIONS.................................................
BUSINESS...................................................................
PROPERTY...................................................................
MANAGEMENT.................................................................
EXECUTIVE COMPENSATION.....................................................
PRINCIPAL SHAREHOLDERS.....................................................
CERTAIN TRANSACTIONS.......................................................
DESCRIPTION OF CAPITAL STOCK...............................................
LITIGATION.................................................................
LEGAL MATTERS..............................................................
EXPERTS....................................................................
ADDITIONAL INFORMATION.....................................................
INDEX TO FINANCIAL STATEMENTS..............................................
FINANCIAL STATEMENTS.......................................................

Until February 16, 1998, all dealers effecting transactions in the Common 
Stock, whether or not participating in the distribution, may be required to 
deliver a Prospectus.  This is in addition to the obligation of dealers to 
deliver a Prospectus when acting as underwriters and with respect to their 
unsold allotments or subscriptions.
PAGE
58
 PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24.  INDEMNIFICATION OF DIRECTORS AND OFFICERS

     Section 78.751 of the Nevada Revised Statutes confers on a director or 
officer an absolute right to indemnification for expenses, including 
attorneys' fees, actually and reasonably incurred by him to the extent he is 
successful on the merits or otherwise in defense of any action, suit, or 
proceeding.  This section also entitles a director or officer to partial 
indemnification against expenses to the extent that he has been successful in 
defending any claim, issue, or matter asserted in such proceeding.  The Nevada 
indemnification section further permits the corporation to indemnify officers 
and directors in circumstances where indemnification is not mandated by the 
statute and certain statutory standards are satisfied.  The Nevada statute 
expressly makes indemnification contingent upon a determination that 
indemnification is proper in the circumstances.   Such determination must be 
made by the board of directors, the shareholders, or independent legal 
counsel.  Nevada law also permits a corporation, in its articles of 
incorporation, bylaws, or an agreement, to pay attorneys' fees and other 
litigation expenses on behalf of a corporate official in advance of the final 
disposition of the action upon receipt of an undertaking by or on behalf of 
the corporate official to repay such expenses to the corporation if it is 
ultimately determined that he is not entitled to be indemnified by the 
corporation.  The corporation may also purchase and maintain insurance to 
provide indemnification.  The  Nevada statute also provides that 
indemnification authorized by the statute is not exclusive of, but is in 
addition to, indemnification rights granted under a corporation's articles of 
incorporation, an agreement, or pursuant to a vote of shareholders or 
disinterested directors.

     The foregoing discussion of indemnification merely summarizes certain 
aspects of indemnification provisions and is limited by reference to Section 
78.751 of the Nevada Revised Statues.

     The Company's articles of incorporation and bylaws do not contain 
specific provisions relating to indemnification of directors, officers, 
employees, and/or agents of the Company.  However, it is anticipated that the 
Company will indemnify its officers and directors to the full extent permitted 
by the above referenced statute.  Insofar as indemnification for liabilities 
arising under the Securities Act may be permitted to directors, officers, and 
controlling persons of the small business issuer pursuant to the foregoing 
provisions, or otherwise, the small business issuer has been advised that in 
the opinion of the Securities and Exchange Commission such indemnification is 
against public policy as expressed in the Securities Act and is, therefore, 
unenforceable.  In the event that a claim for indemnification against such 
liabilities (other than the payment by the small business issuer of expenses 
incurred or paid by a director, officer or controlling person in connection 
with the securities being registered), the small business issuer will, unless 
in the opinion of its counsel the matter has been settled by controlling 
precedent, submit to a court of appropriate jurisdiction the question whether 
such indemnification by the Company is against public policy as expressed in 
the Securities Act and will be governed by the final adjudication of such 
issue.  (See "ITEM 28.  UNDERTAKINGS.")
59

ITEM 25.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

     The following table sets forth the estimated expenses(*) to the Company 
in connection with the offering described in the Registration Statement:

     Registration Fee............................................$   299.43
     Accounting Fees and Expenses................................  2,500.00*
     Legal Fees and Expenses..................................... 20,000.00*
     Blue Sky Fees...............................................  3,725.00* 
     Printing and Engraving......................................  2,500.00* 
     Transfer Agent Fees.........................................  1,000.00* 
                                                                  ----------  
     Total Expenses..............................................$30,024.43
                                                                  ==========  
(*)     All figures are estimates.

ITEM 26.  RECENT SALES OF UNREGISTERED SECURITIES

     Securities issued in the foregoing transaction were issued in reliance on 
the exemption from registration and the prospectus delivery requirements of 
the Securities Act of 1933, as amended (the "Securities Act"), set forth in 
Section 3(b) and/or Section 4(2) of the Securities Act, and Rule 701 and the 
regulations promulgated thereunder.  All of the individuals receiving shares 
pursuant to Rule 701 did so pursuant to a written agreement relating to the 
compensation of such persons.  No cash consideration was received by the 
issuer and the aggregate offering price for the securities was determined to 
be the fair market value for the consulting services provided.  None of the 
purchasers were officers and directors of the issuer at the time of the 
issuance of the securities.

     In connection with the Company's organization the Company issued an 
aggregate of 2,510,000 shares to its founders, Richard A. Steinke and Dennis 
S. Chrobak.  In February 1995, the Company entered into consulting agreements 
with seven individuals to provided professional advice and services to the 
Company in connection with developing the Company's business operations and 
strategic planning.  The Company issued an aggregate of 300,000 shares of 
common stock for such services.  The value of the services provided was 
$30,000, resulting in a calculated per share value of 300,000 shares at $0.10 
per share.  Set forth below are the names of the individuals, the number of 
shares issued, the value of the services provided, and a brief description of 
the services provided to the Company.

                          Number    Value of    Description    Relationship
                          of        Services    of Services    to the
Name of Shareholder       Shares    Provided    Provided       Company
-------------------       ------    --------    -----------    ------------
Bob L. McGiboney          100,000   $10,000     Financial      Consultant
Jerry Burns                 7,000       700     Financial      Consultant
Todd Hooks                 95,000     9,500     Marketing      Consultant
Craig Hooks                30,000     3,000     Marketing      Consultant
Hugh Sims-Hilditch         50,000     5,000     Technical      Consultant
Brad Delp                   8,000       800     Marketing      Consultant
Elliott N. Taylor          10,000     1,000     Legal          Legal Counsel
                          -------   -------
Totals                    300,000   $30,000
                          =======   =======
60  

     In April, 1995, the Company entered into consulting agreements with 
Beverly J. Steinke, the former wife of Richard A. Steinke, C.E.O. of the 
Company,  and Bonnie Chrobak, wife of Dennis S. Chrobak, President of the 
Company, to provide the Company with secretarial and media/graphic services, 
respectively, during the Company's developmental  stages.  The Company paid 
both Ms. Steinke and Mrs. Chrobak 50,000 shares each, valued at $1.00 per 
share, for total consideration of $100,000.

     In April, the Company entered into subscription agreements with Gary 
Dalton, Philip Chrobak, and David Griffiths, three of its Officers, to acquire 
an aggregate of 170,000 shares of its Common Stock at a purchase price of 
$1.00 per share, in exchange for promissory notes bearing interest at 8% per 
annum, payable in 36 months. The promissory notes were subsequently amended to 
become due prior to April 10, 1997.  The Company has adopted a policy that any 
future loans or similar arrangements to its officers, directors, or 5% 
shareholders will not occur unless approved by a majority of the disinterested 
directors and for a bona fide business purpose.  Set forth below are the names 
of the Officers, the number of shares issued, the consideration to be received 
for such shares, and their relationship with the Company. 

                         Number of    Consideration  Balance   Relationship
Name of Shareholder      Shares       to be Paid     Due (3)   to the Company
-------------------      ---------    -------------  -------   --------------
Gary Dalton (1)          100,000      $100,000       $40,000   Former Officer
Philip J. Chrobak (2)     50,000        50,000        45,000   Former Officer
David Griffiths           20,000        20,000          -0-    Officer
                         -------      --------       -------
Totals                   170,000      $170,000       $85,000
                         =======      ========       =======

(1)  As of March 31, 1997, Mr. Dalton had paid $50,000 cash and provided 
services to the Company valued at $10,000, which amounts have been applied 
against the principal and interest to be paid under the promissory note.  Mr. 
Dalton resigned as an officer and director of the Company effective February 
25, 1997.

(2)  As of March 31, 1997, Mr. Chrobak had provided services to the Company 
valued at $5,000, which amount has been applied against the principal and 
interest to be paid under this promissory note.  Mr. Chrobak resigned as an 
officer of the Company effective February 25, 1997.

(3)  Amount due does not include any accrued interest.

PAGE
61

     In May, 1995, the Company issued 720,000 shares of its Common Stock at 
purchase price of $1.00 per share.  Set forth below are the names of the 
purchasers, the consideration paid, and the number of shares purchased:

Name of Shareholder                       Consideration   Number of Shares
-------------------                       -------------   ----------------
John E. Roberts                           $      10,000             10,000
Donald W. Kuchenbecker                           10,000             10,000
Jon Orban                                        10,000             10,000
Robert Orban                                     35,000             35,000
Bob McGiboney                                   110,000            110,000
First London Securities Corporation             110,000            110,000
Edward J. Anderson                               23,000             23,000
M. Priscilla Goodwyn                              5,000              5,000
Michael K. MacCloskey                            80,000             80,000
Mark MacCloskey                                  10,000             10,000
David R. Brod & Laurie A. Strickland, JTWRS       5,000              5,000
Michael P. & Debra B. Anderson                   10,000             10,000
Corporacion de Inversiones Diversificadas       100,000            100,000
Vicent P. Menard                                 10,000             10,000
Jamie M. Nugent                                  10,000             10,000
Arnass Group, Ltd.                              100,000            100,000
Everett Coon, Jr.                                20,000             20,000
Drake, Goodwin & Co., Inc.                       25,000             25,000
James Mathis                                      2,000              2,000
Delaware Charter Guarantee Trust Co.(1)          20,000             20,000
Dorothy D. Winchester Trust                      15,000             15,000
                                           ------------   ----------------
Totals                                     $    720,000            720,000
                                           ============   ================ 

(1) Represents shares held in IRA Accounts at Delaware Charter Guarantee Trust 
Co., FBO Robert M. MacCloskey, 3,000 shares; Karen L. MacCloskey, 2,000 
shares; Mical Lee MacCloskey, 3,000 shares; Michael K. MacCloskey, 2,000 
shares; and Rush B. Winchester, 10,000 shares.

     First London Securities Corporation acted as placement agent in the 
foregoing private placement and received a commission of $70,000 representing 
10% of the offering proceeds from the sale of 700,000 shares.  No commission 
was paid in connection with the sale of 20,000 shares of the foregoing private 
placement.

     Securities issued in the foregoing transaction  were issued in reliance 
on the exemption from registration and the prospectus delivery requirements of 
the Securities Act of 1933, set forth in either Rule 505 or 506 of Regulation 
D and/or Section 4(2) thereof and the regulations promulgated thereunder.  The 
purchasers represented that they were "accredited investors" as that term is 
defined under Rule 501 of Regulation D of the Securities Act.  None of the 
purchasers were Officers and Directors of the issuer at the time of the 
issuance of the securities or currently hold such positions with the issuer.  
Such purchasers were provided information regarding the Company and its 
business and financial condition and met and/or were given opportunity to ask 
questions of the Company's officers and directors.  Subscription agreements 
containing investment and suitability letters and representations were 
executed by each of the purchasers in which they acknowledged that they were 
acquiring "restricted securities" as defined in Rule 144 under the Securities 
Act; that the securities could not be transferred without registration or an 
exemption therefrom; that the securities were being acquired for investment; 
and that the purchasers would not sell the securities without registration or 
the availability of an exemption therefrom.  No general advertising or 
solicitation was used in connection therewith.
62  

     The placement agent confirmed that solicitation of purchasers of the 
securities were made through contacts by its registered representatives 
without any form of general solicitation or general advertising, including, 
but not limited to, any advertisement, article, notice, or other communication 
published in any newspaper, magazine, or similar media or broadcast over 
television or radio or any seminar or meeting whose attendees were invited by 
any general solicitation or general advertising.

     The Company sold 40,642 shares of Common Stock in September 1995, at a 
purchase price of $6.00 per share.  Set forth below are the names of the 
purchasers, the consideration paid, and the number of shares  purchased:

Name of Shareholder                       Consideration   Number of Shares
-------------------                       -------------   ----------------
James A. & Mary Jo Chrobak                $         600                100
Rolyn, Inc.                                       5,556                926
Rebecca Ann Bradley                                 600                100
William B. & Paunez A. Howell                     5,010                835
Lance R. or Laura MacKeown                          600                100
Robert J. Kieres                                  1,200                200
Kurt R. or Zorianna M. Sterbenz                   9,600              1,600
Eric R. Sterbenz                                  3,000                500
Patrick Kelble                                      600                100
Kevin Kelble & Dee Kennedy                        7,200              1,200
Michael or Rosa Kelble                              600                100
Shawn Kelble                                      1,200                200
Gerald D. Kelble, D.D.S.                         18,000              3,000
Paine Webber IRA Custodian FBO Gerald Kelble     12,000              2,000
Richard or Esther Abramson                        1,200                200
Dennis M. & Karen S. Jenkins                      1,200                200
Joan E. Khatib                                    1,590                265
Sandra S. & Earl W. Crissman                      1,800                300
Ann or Gary Tilly                                 1,800                300
Barbara A. Simpson                                2,100                350
Christley, Harington & Pierce                     2,400                400
Jason W. Sarnow                                   3,000                500
Ken Jones                                         3,000                500
Andy & Marcella Lantzman                          4,998                833
Karen Schaefer                                    4,998                833
Andres & Anita Peterson                           6,000              1,000
Wanda Sharrett, M.D.                              6,000              1,000
Thomas H. & Mary Kaye Laabs-Johnson              18,000              3,000
John P. or Kathy M. Malik                        12,000              2,000
Charles R. & Eileen C. Gant                      18,000              3,000
Dr. Paul Schreibman                              30,000              5,000
Paul Rush                                        60,000             10,000
                                           ------------   ----------------
Totals                                     $    243,852             40,642
                                           ============   ================

     The foregoing shares of Common Stock were offered by the Company's 
Officers and Directors and no commissions, directly or indirectly, were paid 
in connection with their sale.
63

     Securities issued in the foregoing transaction were issued in reliance on 
the exemption from registration and the prospectus delivery requirements of 
the Securities Act of 1933, set forth in either Rule 505 or 506 of Regulation 
D and/or Section 4(2) thereof and the regulations promulgated thereunder.  
Fifteen  of the thirty purchasers represented that they were "accredited 
investors" as that term is defined under Rule 501 of Regulation D of the 
Securities Act.  None of the purchasers were Officers and Directors of the 
Company at the time of the issuance of the securities or currently hold such 
positions with the issuer.  Such purchasers were provided information 
regarding the Company and its business and financial condition and met and/or 
were given opportunity to ask questions of the Company's Officers and 
Directors. 

     Subscription agreements containing investment and suitability letters and 
representations were executed by each of the purchasers in which they 
acknowledged that they were acquiring "restricted securities" as defined in 
Rule 144 under the Securities Act; that the securities could not be 
transferred without registration or an exemption therefrom; that the 
securities were being acquired for investment; and that the purchasers would 
not sell the securities without registration or the availability of an 
exemption therefrom.  No general advertising or solicitation was used in 
connection therewith.

     The foregoing private placement was made at a time when the Company had a 
registration statement on file with the Commission.  Although the Company took 
steps to ensure that the sale of the common stock would not become part of the 
Company's proposed public offering, due to the timing of the private placement 
during the pendency of the public registration process, the Company's reliance 
on Section 4(2) possibly could have been challenged.  In connection with the 
Company's initial public offering, the Company made a recision offer to the 
purchasers of the 40,642 shares of common stock in an effort to remove and 
reduce as much as possible any liability the Company may have had or could 
have incurred relating to the sale of the common stock.  On termination of the 
recision offer, the Company has received notices of acceptance of the recision 
offer for an aggregate of 34,977 shares.  The Company issued checks to the 
rescinding purchasers in the aggregate of $193,704, which amount included all 
accrued interest in connection therewith.

     On October 31, 1996, Dennis S. Chrobak and Gary Dalton, two of the 
Company's officers and directors, agreed to cancel approximately $56,735 in 
principal and accrued interest due them under certain promissory notes in 
exchange for the issuance of 27,000 shares of the Company's restricted common 
stock at an exchange valued at approximately $2.10 per share.

     Effective February 28, 1997, the Company completed the acquisition of UTI 
Chemicals (Europe), Ltd, a United Kingdom corporation ("UTI-UK"), from Coronel 
Investment Limited, a Jersey corporation ("Coronel").  The acquisition was 
made pursuant to a Share Purchase Agreement, which provided that the Company 
issue to Coronel 200,000 shares of the Company's restricted common stock as a 
portion of the consideration for the purchase of UTI-UK.  The shares issued to 
Coronel were valued at $7.75 per share, the closing bid price for the 
Company's common stock on February 28, 1997.

     The securities issued in the foregoing transactions were issued in 
reliance on the exemption from registration and the prospectus delivery 
requirements of the Securities Act under section 4(2) thereof and the 
regulations promulgated thereunder.
PAGE
64  

     The Company sold 155,000 shares of Common Stock in February 1997, at a 
purchase price of $6.00 per share.  Set forth below are the names of the 
purchasers, the consideration paid, and the number of shares  purchased:

Name of Shareholder                       Consideration   Number of Shares
-------------------                       -------------   ----------------
Lowell L. Leishman                        $      72,000             12,000
2156 Associates, a Utah partnership             120,000             20,000
William L. Jiler                                 90,000             15,000
Matthew L. & Erin S. Haynie, JTWRS               18,000              3,000
Graphic Arts Management Profit Sharing Plan      90,000             15,000
Frank Lankey                                     30,000              5,000
Jay M. Grossman                                  18,000              3,000
Richard K. & Janice S. Milne, JTWRS              30,000              5,000
James & Carolee Okland, JTWRS                    24,000              4,000
Henry D. Moyle                                  120,000             20,000
David P. Scheffenacker                           24,000              4,000
Theodore S. Green & Debra Beneck                 18,000              3,000
Adele Gilchrist                                   6,000              1,000
Carol H. Tate                                     6,000              1,000
Jeffrey W. Gold, IRA                             36,000              6,000
Jeffrey W. & Robyn Gold, JTWRS                   84,000             14,000
Louis M. Haynie                                  84,000             14,000
Joseph S. Haynie                                  6,000              1,000
Michael L. Haynie                                18,000              3,000
Gae B. Haynie                                    12,000              2,000
Gary R. Howe, IRA                                 6,000              1,000
Gary R. Howe & Sharon F. Howe, JTWRS             18,000              3,000
                                           ------------   ----------------
Totals                                     $    930,000            155,000
                                           ============   ================

     The foregoing shares of Common Stock were offered by the Company's 
Officers and Directors and no commissions, directly or indirectly, were paid 
in connection with their sale.

     Securities issued in the foregoing transaction were issued in reliance on 
the exemption from registration and the prospectus delivery requirements of 
the Securities Act of 1933, set forth in Rule 506 of Regulation D and/or 
Section 4(2) thereof and the regulations promulgated thereunder.  The 
purchasers represented that they were "accredited investors" as that term is 
defined under Rule 501 of Regulation D of the Securities Act.  None of the 
purchasers were Officers and Directors of the Company at the time of the 
issuance of the securities or currently hold such positions with the issuer.  

     Subscription agreements containing investment and suitability letters and 
representations were executed by each of the purchasers in which they 
acknowledged that they were acquiring "restricted securities" as defined in 
Rule 144 under the Securities Act; that the securities could not be 
transferred without registration or an exemption therefrom; that the 
securities were being acquired for investment; and that the purchasers would 
not sell the securities without registration or the availability of an 
exemption therefrom.  No general advertising or solicitation was used in 
connection therewith.
65  

ITEM 27.  EXHIBITS

     Copies of the following documents have been included as exhibits to this 
Registration Statement, pursuant to Item 601 of Regulation S-B.  The index to 
exhibits required by such item appears at consecutively numbered page 67.

         SEC
Exhibit  Reference
No.      No.        Title of Document                          Location
-------  ---------  -----------------                          --------

  1      3(i)       Articles of Incorporation and Amendments   Incorporated by
                                                               Reference (1)

  2      3(ii)      Bylaws                                     Incorporated by
                                                               Reference (1)

  3      5          Opinion of Taylor and Associates, Inc.
                    Attorneys and Counselors at Law            This Filing

  4      23         Consent of Saltz, Shamis & Goldfarb, Inc.,
                    Certified Public Accountants               This Filing

  5      23         Consent of Taylor and Associates, Inc.,
                    Attorneys and Counselors at Law            This Filing

 
(1)  Incorporated by reference to the Company's registration statement on Form 
SB-2, SEC file no. 33-94318-C, and all amendments thereto.

ITEM 28.  UNDERTAKINGS

     The undersigned Registrant hereby undertakes that it will:

     (1)  File, during any period in which offers or sales are being made, a 
post-effective amendment to this Registration Statement to (i) include any 
Prospectus required by Section 10(a)(3) of the Securities Act; (ii) reflect in 
the Prospectus any facts or events which, individually or in the aggregate, 
represent a fundamental change to the information in the Registration 
Statement; and (iii) include any material information with respect to the plan 
of distribution not previously disclosed in the Registration Statement or any 
material change to such information in the Registration Statement.

     (2)  For the purpose of determining liability under the Securities Act, 
each post-effective amendment will be treated as a new Registration Statement 
of the securities offered, and the offering of the securities at that time 
shall be the initial bona fide offering.

     (3)  If, applicable, file a post-effective amendment to remove from 
registration any of the securities that remain unsold at the end of the 
offering.

     Insofar as indemnification for liabilities arising under the Securities 
Act may be permitted to directors, officers, and controlling persons of the 
Registrant pursuant to the foregoing provisions, or otherwise, the small 
business issuer has been advised that in the opinion of the Securities and 
Exchange Commission such indemnification is against public policy as expressed 
in the Securities Act and is, therefore, unenforceable.
PAGE
66  

     In the event that a claim for indemnification against such liabilities 
(other than the payment by the Registrant of expenses incurred or paid by a 
director, officer or controlling person in connection with the securities 
being registered), the Registrant will, unless in the opinion of its counsel 
the matter has been settled by controlling precedent, submit to a court of 
appropriate jurisdiction the question whether such indemnification by the 
Registrant is against public policy as expressed in the Securities Act and 
will be governed by the final adjudication of such issue.

     The undersigned Registrant hereby undertakes that it will:

     (1)  For determining any liability under the Securities Act, treat the 
information omitted from the form of Prospectus filed as part of this 
Registration Statement in reliance upon Rule 430A and contained in a form of 
Prospectus filed by the Registrant under Rule 424(b)(1), or (4), or 497(h) 
under the Securities Act as part of this Registration Statement as of the time 
the Commission declared it effective.

     (2)  For determining any liability under the Securities Act, each post 
effective amendment that contains a form of Prospectus will be treated as a 
new Registration Statement for the securities offered in the Registration 
Statement, and that offering of the securities at that time as the initial 
bona fide offering of those securities.
PAGE
67

AMERICAN TIRE CORPORATION

INDEX TO EXHIBITS

         SEC
Exhibit  Reference
No.      No.        Title of Document                          Location
-------  ---------  -----------------                          --------

  1      3(i)       Articles of Incorporation and Amendments   Incorporated by
                                                               Reference (1)

  2      3(ii)      Bylaws                                     Incorporated by
                                                               Reference (1)

  3      5          Opinion of Taylor and Associates, Inc.
                    Attorneys and Counselors at Law            Exhibit No. 3

  4      23         Consent of Saltz, Shamis & Goldfarb, Inc.,
                    Certified Public Accountants               Exhibit No. 4 

  5      23         Consent of Taylor and Associates, Inc.,
                    Attorneys and Counselors at Law            See Exhibit
                                                               No. 5

 
(1)  Incorporated by reference to the Company's registration statement on Form 
SB-2, SEC file no. 33-94318-C, and all amendments thereto.