WTA Signs Master Licenses for $4M, Mexico, Caribbean deal will bring over $5M annually
7 July 1999
WTA Signs Master Licenses for $4M, Mexico, Caribbean deal will bring over $5M annually
EL CAJON, Calif.--July 6, 1999--Composite Auto(OTC Bulletin Board:CARHF) World Transport Authority (WTA), a wholly-owned subsidiary of Composite Automobile Research, Ltd. (OTC BB:CARHF) announced today it has executed two "Master License" agreements with Industria Automotriz Mexicana, S.A. de C.V. (IAM) of Tijuana, Mexico, for $4 million cash.The agreements, signed June 29, 1999, grant IAM the right to built the proprietary WorldStar automobile manufacturing facilities and the WorldStar "factories to build factories" throughout Mexico and the Caribbean.
Emilio Sacal, IAM President, described his vision for the WorldStar in his country. "The WorldStar is the most durable, affordable, environmentally friendly, and economical-to-own vehicle in the world. It is a timely, cost-efficient solution to the needs of large commercial transport fleets and modest-income populations. IAM will aggressively market the WorldStar, in custom configurations, to meet the large-volume needs of cargo carriers like Federal Express and DHL. Further, we will bring the first truly reliable, easy-to-own car to the masses in both Mexico and the Caribbean."
IAM plans to install 10 factories over the next 60 months, in strategic locations throughout Mexico and the Caribbean. Conservative estimates call for production of 3,240 cars-per-year from the factories, with potential capacity of 9,750 vehicles-per-year. The cars will retail at approximately $7,000U.S.
Under the terms of the Master License agreements, WTA retains a 20% interest in each factory that manufactures factories to build the WorldStar cars, and a 6% interest in each auto manufacturing facility. WTA is the sole supplier of raw material and proprietary auto components and parts to each manufacturing facility. The annual recurring revenue from the ownership interest and parts sales for each one-car-per day factory is $194,000US. Annual residual income projections for WTA from the IAM Master Licenses exceed $5 million.
World Transport Authority is the designer and manufacturer of the WorldStar Vehicle. The vehicle, in four configurations, represents four years and $3.44-million of investment in research and development to produce a highly resilient composite automobile that can be easily manufactured using locally available labor in emerging-world nations. The vehicles are produced under distributed manufacturing licensing agreements with local entrepreneurs in the nations in which the vehicles are sold.
Standardization and quality control are built-in to the "cookie-cutter" facilities delivered to site locations "ready-to-install," under the supervision of WTA engineers who train key personnel in all facets of manufacturing of the unique automobiles. The company provides ongoing training and management information support to the local factories, and controls all inventory delivery of raw materials and component parts.
The company is strategically positioned to satisfy the rapidly emerging requirement for reliable transportation in geographic regions ignored by major auto manufactures such as Ford , Chrysler , and General Motors .
WTA has completed its research and development cycle and is operationally profitable entering its production and marketing stage. The company has no debt.
The MacArthur Foundation of Zurich has selected Composite Automobile Research, Ltd and World Transport Authority for an in-depth "Special Situation" report, which can be viewed at www.macarthurfoundation.com. Additionally, CARHF and WTA are profiled on the premier investor information site, Market Infocom at www.market-infocom.com.
This press release contains forward-looking statements within the definition of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are based on the beliefs of the company's management as well as on assumptions made by and information currently available to the company at the time such statements were made. Actual results could differ materially from those included in such forward-looking statements.