<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

                     ANNUAL REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002

                                    333-73286
                            (Commission file number)

                             CARCORP USA CORPORATION
        (Exact name of small business issuer as specified in its charter)

                DELAWARE                                      26-0003788
      (State or other jurisdiction                           (IRS Employer
    of incorporation or organization)                     Identification No.)

         1300 EAST HILLSBORO BLVD., SUITE 102 DEERFIELD BEACH, FL 33441
               (Address of principal executive offices) (Zip Code)

                                 (888) 735-5557
                           (Issuer's telephone number)

        SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE

           SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:

                               TITLE OF EACH CLASS
                          COMMON STOCK, $.001 PAR VALUE

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark if there is no disclosure of delinquent filers in
response to Item 405 of Regulation S-B is not contained in this form, and no
disclosure will be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by referenced in Part
III of this Form 10-KSB or any amendment to this Form 10-KSB. [ ]

Revenue for the year ended December 31, 2002: $2,119,211.

The aggregate market value of the voting stock held by non-affiliates computed
by reference to the average bid and asked prices of such stock on April 14, 2003
was $1,197,145.

The number of shares outstanding of the registrant's Common Stock as of April
14, 2003 was 21,751,033.

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      None

Transitional Small Business Disclosure Format (check one):  Yes [   ]   No [X]

<PAGE>

                                     PART I

CAUTIONARY STATEMENT FOR PURPOSES OF "SAFE HARBOR PROVISIONS" OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995.

Certain statements contained in this Annual Report on Securities and Exchange
Commission ("SEC") Form 10-KSB ("Form 10-KSB") constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements involve known and unknown risks, uncertainties and
other factors that may cause our or our industry's actual results, levels of
activity, performance or achievements to be materially different than any
expressed or implied by these forward-looking statements. These statements may
be contained in our filings with the SEC, press releases, and written or oral
presentations made by our representatives to analysts, rating agencies,
stockholders, news organizations and others. In some cases, you can identify
forward-looking statements by terminology such as "may," "will," "should,"
"intend", "expects," "plans," "anticipates," "believes," "estimates,"
"predicts," "potential," "continue," or the negative of these terms or other
comparable terminology. Although we believe that the expectations in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements

ITEM 1. DESCRIPTION OF BUSINESS

We were incorporated in Delaware on February 4, 1999 under the name of Hydrox
Sales Corp. Carcorp USA Inc. was incorporated under the laws of Florida on
January 27, 2000. Pursuant to an agreement dated January 26, 2001, and amended
on November 8, 2001, Carcorp. was acquired by Hydrox in a transaction accounted
for as a reverse merger. Hydrox issued 15,000,000 shares of its common stock for
all of the issued and outstanding common stock of Carcorp. As a result,
Carcorp's former stockholder exercised control over Hydrox. Prior to the merger,
Hydrox had no business activity. For accounting purposes, Carcorp. has been
treated as the accounting acquirer and, accordingly, is presented as the
continuing entity, and the historical financial statements are those of Carcorp.
Hydrox changed its name to Carcorp USA Corporation

We are a Florida-based transportation finance company that provided full payout
lease financing for a wide range of commercial and personal vehicles, including
middle market autos, luxury sports and specialty cars, limousines, trucks, and
coach buses. From our inception, we had specialized in the near-prime credit
sector, which is strategically positioned immediately below prime, but
significantly above sub-prime, representing the B+ to C+ credit quality
borrower. The near-prime vehicle leasing sector remains underserved and interest
rates of 15% to 20% per annum are accepted industry standards. The interest
rates earned on our portfolio of leases ranged from 13% to 18% with the average
being approximately 15%.

However, in December 2002, we lost the only funding source with Citicapital
(formerly European American Bank), for our vehicle leasing activities and were
unable to obtain any other funding sources. Furthermore, Citicapital confiscated
all leased vehicles returned to and/or repossessed by us, which were financed by
Citicapital. As a result of the foregoing factors, we discontinued our vehicle
leasing activities as of December 31, 2002. We have accounted for this
discontinuance as discontinued operations in accordance with Statement of
Financial Accounting Standards No. 144. (See Note 2 to the financial statements
included elsewhere in this document for additional discussion). We have plans to
sell the net assets and liabilities related to the vehicle leasing activities to
our Chief Executive Officer and majority shareholder in exchange for shares of

                                       2
<PAGE>

our common stock that he currently owns. The terms of this sale have not been
finalized, however, no gain or loss will be recognized upon the completion of
this sale. We believe we will finalize the sale with our Chief Executive Officer
and majority shareholder by the end of the second quarter of 2003. As a result
of the discontinued operations of our vehicle leasing activities, our only
activity as of December 31, 2002 was maintaining our corporate affairs.

Following the actions of Citicapital, we aggressively sought to commence an
acquisition or merger with a private entity. On February 4, 2003, we entered
into a Share Exchange Agreement with Elite Flight Solutions, Inc. whereby, we
will issue 27,607,500 shares of our common stock in exchange for all the issued
and outstanding shares of Elite. Elite is a provider of public air
transportation and air jet charter services. This transaction is expected to
close on or before April 30, 2003. However, there can be no assurance that the
conditions that must be fulfilled prior to closing this transaction will occur
in a timely manner or at all.

We have, and will continue to have, very little capital with which to provide
the owners of business opportunities with any significant cash or other assets.
However, we believe we will be able to offer owners of acquisition candidates
the opportunity to acquire a controlling ownership interest in a company who has
complied with the 1934 Act and currently trading on the OTCBB without incurring
the cost and time required to conduct an initial public offering.


                                  RISK FACTORS

WE WILL INCUR EXPENSES EVEN THOUGH WE HAVE NO CURRENT SOURCE OF REVENUE

We were forced to discontinue our auto leasing business due to our primary
lender not allowing us to originate any new leases and confiscating all leased
vehicles returned to and/or repossessed by us, which were financed by
Citicapital. We are currently seeking to acquire to merge with another private
entity. Currently, we have no significant assets or financial resources. We
will, in all likelihood, sustain operating expenses without corresponding
revenues, at least until the consummation of a business combination. This may
result in us incurring a net operating loss which will increase continuously
until we can consummate a business combination with a profitable business
opportunity.


WE HAVE IDENTIFIED A POTIENTAL MERGE CANDIDATE BUT THERE CAN BE NO ASSURANCE WE
CAN CLOSE THIS TRANSACTION

On February 4, 2003, we entered into a Share Exchange Agreement with Elite
Flight Solutions, Inc. This transaction is expected to close on or before April
30, 2003. However, there can be no assurance that the conditions that must be
fulfilled prior to closing this transaction will occur in a timely manner or at
all.


OUR FUTURE OPERATION MAY NOT GENERATE PROFITS AND CASH FLOW TO SUSTAIN FUTURE
OPERATIONS

The success of our proposed plan of operation will depend to a great extent on
the operations, financial condition and management of the identified business

                                       3
<PAGE>

opportunity. While we intend to seek business combination(s) with entities
having established operating histories, there can be no assurance that we will
be successful in locating candidates meeting such criteria. In the event we
complete a business combination, of which there can be no assurance, the success
of our operations may be dependent upon management of the successor firm and
numerous other factors beyond our control.


WE EXPECT THAT EXISITING SHAREHOLDERS WILL BE DILUTED UPON THE CONSUMMATION OF A
BUSINESS COMBINATION.

Our primary plan of operation is based upon a business combination with a
private concern which, in all likelihood, would result in us issuing securities
to shareholders of any such private company. The issuance of previously
authorized and unissued common shares would result in reduction in percentage of
shares owned by present and prospective shareholders and may result in a change
in control or management.


OUR CHIEF EXECUTIVE OFFICER CONTROLS OUR COMPANY WHICH RESULTS IN OUTSIDE
INVESTORS HAVING A MINORITY OWNERSHIP POSITION AND VERY LITTLE CONTROL OVER OUR
COMPANY

Our chief executive officer own 60.7% of our issued and outstanding share of
common stock and will be able to elect a majority of the board of directors and
will control our business operations and policies and be able to decide on
potential merger or acquisition candidates.


OUR CHIEF EXECUTIVE OFFICER WAS INVOLVED IN A SIMILAR AUTO LEASE FINANCE
BUSINESS THAT FILED FOR BANKRUPTCY ON MAY 18, 2001.

Our chief executive officer, Michael DeMeo, is an officer and sole shareholder
of CarCorp, Inc. that filed for bankruptcy on May 18, 2001. CarCorp, Inc. was
incorporated in Florida in January 1990 and is licensed by the State of Florida
as a motor vehicle dealer. The operations of CarCorp, Inc. are similar to our
operations. The bankruptcy filing by CarCorp, Inc. resulted from alleged
liabilities due to CarCorp, Inc.'s primary funding source resulting from a 1997
master purchase agreement. On December 7, 2001, CarCorp, Inc. filed a Debtor's
Disclosure Statement with the United States Bankruptcy Court for the Southern
District of Florida.

WE RELY UPON OUR CHIEF EXECUTIVE OFFICER TO EXPAND OUR BUSINESS AND THE LOSS OF
THIS INDIVIDUAL WOULD HAVE A NEGATIVE IMPACT ON OUR BUSINESS.

Our success is dependent, in large part, on the active participation of our
chief executive officer, Michael DeMeo. The loss of his services would
materially adversely affect our business and future success. We do not have an
employment agreement with Mr. DeMeo. We do not have key-man life insurance in
effect at the present time; however, we are seeking information and quotations
regarding the same and may obtain such coverage, if the cost is reasonable.

IT IS UNLIKELY THAT DIVIDENDS WILL BE PAID ON OUR STOCK RESULTING IN AN
INVESTORS ONLY RETURN ON AN INVESTMENT IN OUR COMMON STOCK IS THE APPRECIATION
OF THE PER SHARE PRICE.

                                       4
<PAGE>

Payment of dividends on our stock is within the discretion of the Board of
Directors and will depend upon our earnings, our capital requirements and
financial condition, and other relevant factors. We do not currently intend to
declare any dividends on our common stock in the foreseeable future. At the
present time, we intend to use earnings, if any, which may be generated to
finance the growth of our business. An investors return on an investment in our
common stock is only likely to be the appreciation of the per share price of our
common stock.


EMPLOYEES

As of April 14, 2003, we employed 5 full time individuals. Our employees are not
unionized, and we consider our relations with our employees to be favorable.


ITEM 2. DESCRIPTION OF PROPERTY

We lease office space in Deerfield Beach, FL from a related party on a month to
month basis at a rate of $1,200 per month.


ITEM 3. LEGAL PROCEEDINGS

In a lawsuit filed by Citicorp Leasing, Inc., as the assignee of European
American Bank ("EAB") against Carcorp USA, Inc., (our wholly owned subsidiary)
on or about October 18, 2002 and thereafter transferred to Broward County,
Florida on or about November 26, 2002, Case Number: 02-021680-CA (13), Citicorp
Leasing obtained a temporary restraining order wherein all matters regarding the
EAB portfolio originated or purchased by Carcorp USA, Inc., has been halted. A
final judgment was entered into in New York against Carcorp USA, Inc. on March
9, 2003. The judgment provided an award in favor of Citicorp Leasing, Inc. in
the amount of $14,706,912. The temporary restraining order previously entered in
favor of Citicorp Leasing, Inc. was made permanent. Carcorp USA, Inc. has filed
an Answer and Counter Claim and a responsive pleading is due by Citicorp
Leasing, Inc. on or before April 30, 2003. We believe that the total amount
awarded by the New York Court will be reduced by the amount of the value of the
lease portfolio. Accordingly, we believe we have recorded a sufficient amount
due to Citicorp Leasing, Inc. as of December 31, 2002 to account for this claim.
Nevertheless, Carcorp USA, Inc., believes is has a number of counterclaims to
this judgment and intends to defend against this action vigorously.

An Adversarial Proceeding has been filed in the Bankruptcy Court for the
Southern District of Florida by the Trustee of Carcorp Inc., Soneet Kapila,
Trustee, against Carcorp USA, Inc., Case Number 01-23742-BKC-PGH. In this
action, the Trustee seeks the turnover of motor vehicles or the value thereof,
for vehicles owned at one point in time by Carcorp Inc., and thereafter sold to
Carcorp USA, Inc., prior to the Chapter 11 filing by Carcorp Inc. In the opinion
of counsel retained by Carcorp USA, Inc., this matter was filed by the Trustee
in Bankruptcy to foreclose any transfers which may have occurred after the bar
date in the Chapter 11 proceeding filed by Carcorp Inc. Since no evidence of
improper transfers have been found to occur after the bar date, it is the
expectation of our counsel that this action will be settled to the satisfaction
of all parties.


ITEM 4. SUBMISSION OR MATTERS TO A VOTE OF SECURITY HOLDERS

Not Applicable

                                       5
<PAGE>

                                     PART II


ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Our common stock began trading on the NASD Electronic Bulletin Board under the
symbol CUSA on July 30, 2003. The following table sets forth the range of high
and low bid quotations for each fiscal quarter from inception of trading until
March 31, 2003. The quotations represent inter-dealer quotations without
adjustment for retail mark-ups, mark-downs or commissions and may not represent
actual transactions.


                  ------------------------ ----------------- ------------------
                                                  High               Low
                  ------------------------ ----------------- ------------------
                  3rd Quarter 2002               $ 3.38             $ 0.11
                  ------------------------ ----------------- ------------------
                  4th Quarter 2002               $ 0.24             $ 0.04
                  ------------------------ ----------------- ------------------
                  1st Quarter 2003               $ 0.44             $ 0.05
                  ------------------------ ----------------- ------------------


RECORD HOLDERS

As of April 14, 2003 we had 1,319 shareholders of record. This does not include
shares held in street names.


DIVIDENDS

We has never declared or paid any cash dividends on our common stock. We
currently intend to retain all available funds for use in our business and
therefore does not anticipate paying any cash dividends in the foreseeable
future. Any future determination relating to dividend policy will be made at the
discretion of our Board of Directors and will depend on a number of factors,
including the future earnings, capital requirements, financial condition and
future prospects and such other factors as the Board of Directors may deem
relevant.

EQUITY COMPENSATION PLANS

None

                                       6
<PAGE>

ITEM 6.  MANAGEMENT'S DISCUSSIONS AND ANALYSIS OR PLAN OF OPERATIONS

OVERVIEW AND BACKGROUND

We were incorporated in Delaware on February 4, 1999 under the name of Hydrox
Sales Corp. Carcorp USA Inc. was incorporated under the laws of Florida on
January 27, 2000. Pursuant to an agreement dated January 26, 2001, and amended
on November 8, 2001, Carcorp. was acquired by Hydrox in a transaction accounted
for as a reverse merger. Hydrox issued 15,000,000 shares of its common stock for
all of the issued and outstanding common stock of Carcorp. As a result,
Carcorp's former stockholder exercised control over Hydrox. Prior to the merger,
Hydrox had no business activity. For accounting purposes, Carcorp. has been
treated as the accounting acquirer and, accordingly, is presented as the
continuing entity, and the historical financial statements are those of Carcorp.
Hydrox changed its name to Carcorp USA Corporation

We are located in Deerfield Beach, Florida and were a full service financing
company. We were founded by our Chief Executive Officer, Michael DeMeo. We
specialized in the financing of automobiles, exotic automobiles, limousines,
buses and trucks for commercial and consumer accounts on a national basis. We
provided all leases on a full-payout basis. During our time in business, we
developed a nationwide network of dealers and brokers that provide an
ever-growing volume of lease financing activity. The market sector that we
served was a B+ to C+ quality borrower. This segment has provided a rate range
of approximately 15% to 20% with limited downside exposure to us, do to our high
credit standards and successful collection practices, which are backed up by
well-managed and highly integrated Asset Recovery and Redistribution System.

However, in December 2002, we lost the only funding source with Citicapital
(formerly European American Bank), for our vehicle leasing activities and were
unable to obtain any other funding sources. Furthermore, Citicapital confiscated
all leased vehicles returned to and/or repossessed by us, which were financed by
Citicapital. As a result of the foregoing factors, we discontinued our vehicle
leasing activities as of December 31, 2002. We have accounted for this
discontinuance as discontinued operations in accordance with Statement of
Financial Accounting Standards No. 144. (See Note 2 to the financial statements
included elsewhere in this document for additional discussion). Accordingly, we
have reflected all activities related to vehicle leasing operations as
discontinued operations in the accompanying financial statements. We have plans
to sell the net assets and liabilities related to the vehicle leasing activities
to our Chief Executive Officer and majority shareholder in exchange for shares
of our common stock that he currently owns. The terms of this sale have not been
finalized however, no gain or loss will be recognized upon the completion of
this sale. We believe we will finalize the sale with our Chief Executive Officer
and majority shareholder by the end of the second quarter of 2003. As a result
of the discontinued operations of our vehicle leasing activities, our only
activity as of December 31, 2002 was maintaining our corporate affairs.

Following the actions of Citicapital, we aggressively sought to commence an
acquisition or merger with a private entity. On February 4, 2003, we entered
into a Share Exchange Agreement with Elite Flight Solutions, Inc. whereby, we
will issue 27,607,500 shares of our common stock in exchange for all the issued
and outstanding shares of Elite. Elite is a provider of public air
transportation and air jet charter services. This transaction is expected to
close on or before April 30, 2003. However, there can be no assurance that the
conditions that must be fulfilled prior to closing this transaction will occur
in a timely manner or at all.

                                       7
<PAGE>

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our discussion and analysis of our financial condition and results of operations
are based upon our consolidated financials statements, which have been prepared
in accordance with accounting principles generally accepted in the United States
of America. The preparation of these financial statements requires us to make
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses, and related disclosures of contingent assets and
liabilities. On an ongoing basis, we evaluate our estimates, including those
related to valuation allowances, and the carrying value of our vehicle
inventory. We base our estimates on historical experience and on various other
assumptions that we believe to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying value of
assets and liabilities that are not readily apparent from other sources. Actual
results may differ from these estimates under different assumptions or
conditions; however, we believe that our estimates, including those for the
above-described items, are reasonable.


RESULTS OF OPERATIONS

OPERATING EXPENSES

Stock based compensation and expenses for the year ended December 31, 2002
increased by $1,426,149 from $3,851 for the year ended December 31, 2001 to
$1,430,000 for the year ended December 31, 2002. The significant increase is due
to the issuance of 1,100,000 shares of common stock to pay consultants. The
shares were valued based on the market value of our stock at the date the shares
were issued.

General and administrative for the year ended December 31, 2002 decreased by
$22,359 or 17.7% from $126,610 for the year ended December 31, 2001 to $104,251
for the year ended December 31, 2002. These expenses represent costs associated
with operating the holding company. There were more professional fees incurred
in 2001, the year the transaction with Carcorp USA, Inc. took place, than were
incurred in 2002.

DISCONTINUED OPERATIONS

Revenues from discontinued operations for the year ended December 31, 2002
decreased by $3,215,348 or 60.3% from $5,334,559 for the year ended December 31,
2001 to $2,119,211 for the year ended December 31, 2002. The decrease is due to
us not originating as many leases in the 2nd half of 2002 as compared to the 2nd
half of 2001 and a higher number of repossessed and available for sale vehicles.

Expenses from discontinued operations for the year ended December 31, 2002
increased by $4,274,278 or 99.6% from $4,291,522 for the year ended December 31,
2001 to $8,565,800 for the year ended December 31, 2002. The increase is due an
increase in the allowance for credit losses and the write off of the vehicles
available for sale that were confiscated by Citicapital.

LIQUIDITY AND CAPITAL RESOURCES

From our inception we have financed our working capital needs principally from a
note payable to our founder and Chief Executive Officer. We also obtained notes
payable from Citicapital (formerly European American Bank) to purchase vehicles
that we could lease to our customers. As note above, we lost our only funding

                                       8
<PAGE>

source for our vehicle leasing activities and were unable to obtain any other
funding sources. In addition, Citicapital confiscated all leased vehicles
returned to and/or repossessed by us, which were financed by Citicapital. As a
result, we discontinued our vehicle leasing activities as of December 31, 2002.

We currently have no cash and no prospects to generate cash from our
discontinued operations. We will have to raise capital through the sale of
equity or debt to outside third parties, continue to be funded by our Chief
Executive Officer or merge with or acquire a private entity that generates
positive cash flows from operations to remain in existence.


ITEM 7.  FINANCIAL STATEMENTS

SEE "INDEX TO CONSOLIDATED FINANCIAL STATEMENTS" BEGINNING ON PAGE F-1.


ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

Our Board of Directors made a change to retain L.L. Bradford & Company, LLC, as
our independent public accountants. On November 13, 2002, our Board of Directors
approved a resolution to engage the services of L.L. Bradford and to dismiss
Merdinger, Fruchter, Rosen & Company, P.C as our independent public accountants.
The Board notified Merdinger, Fruchter, Rosen & Company, P.C of their dismissal
on approximately November 13, 2002.

The reports of Merdinger, Fruchter, Rosen & Company, P.C. on ours financial
statements for the past 2 fiscal years did not contain an adverse opinion or a
disclaimer of opinion nor were the statements qualified or modified as to audit
scope or accounting principles nor were we classified as a going concern.
Further, the financial statements were not qualified or modified as to any other
uncertainties.

Merdinger, Fruchter, Rosen & Company, P.C. and us did not, in connection with
the audit of our financial statements for the previous 2 fiscal years, or for
any subsequent interim periods prior to and including November 13, 2002 have any
disagreements on any matter of accounting principles or practices, financial
statement disclosures, or auditing scope or procedures, which disagreement, if
not resolved to Merdinger, Fruchter, Rosen & Company, P.C. 's satisfaction,
would have caused Merdinger, Fruchter, Rosen & Company, P.C. make reference to
the subject matter of the disagreement in connection with its reports.

We had no relationship with L.L. Bradford & Company, L.L.C. required to be
reported pursuant to Regulation S-B Item 304 (a) (2) during the previous 2
fiscal years, or the subsequent interim periods prior to and including November
13, 2002.

                                       9
<PAGE>

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTER AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT

The following table sets forth the name, age and position with the Company of
each officer and director as of the date of this Report.

Our current directors, executive officers and key employees are as follows:


          NAME           AGE                      POSITION
    Michael J. DeMeo     51     Chairman, President, and Chief Executive Officer


MICHAEL J. DEMEO. Mr. DeMeo is the President and CEO and founder of CarCorp USA,
Inc. He is responsible for overseeing the daily operation of the Company and
helping in the development of the Company's growth plan and strategy. Mr.
DeMeo's business career spans over eighteen years. He has gained experience in
all phases of Lease Financing, Retail and Commercial Lending. In January of
1990, Mr. DeMeo established CarCorp, Inc. as a full recourse lender, as well as
an independent finance/lease company specializing in standard and high end
autos, limousines, coach buses, and heavy duty trucks and trailers. On May
18,2001, CarCorp, Inc. filed for bankruptcy.

Pursuant to Section 16 (a) of the Securities Exchange Act of 1934, and the rules
issued thereunder, our directors and executive officers are required to file
with the Securities and Exchange Commission and the National Association of
Securities Dealers, Inc. reports of ownership and changes in ownership of common
stock and other equity securities of the Company. Copies of such reports are
required to be furnished to us. Based solely on a review of the copies of such
reports furnished to us, or written representations that no other reports were
required, we believe that, during our fiscal year ended December 31, 2001, all
of our executive officers and directors complied with the requirements of
Section 16 (a).


ITEM 10.  EXECUTIVE COMPENSATION

The following table sets forth the annual compensation paid to our executive
officers for the fiscal years ended December 31, 2002, 2001 and 2000. No other
executive officer received salary and bonus compensation in excess of $100,000
in the two most recent completed fiscal years.

<TABLE>
<CAPTION>
                                                                               Other           Long-term
           Name and                                                           Annual          Compensation
      Principal Position          Year      Salary ($)      Bonus ($)      Compensation          Awards
------------------------------- ---------- -------------- -------------- ------------------ -----------------
<S>                               <C>         <C>               <C>              <C>               <C>
Michael J. DeMeo                  2002         93,607           -                -                 -
Chairman, President               2001        100,000           -                -                 -
and Chief Executive Officer       2000           -              -                -                 -
</TABLE>

                                       10
<PAGE>

ITEM 11.  SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information as of April 14, 2003
regarding the record and beneficial ownership of our common stock by: (i) any
individual or group (as that term is defined in the federal securities laws) of
affiliated individuals or entities who is known by us to be the beneficial owner
of more than five percent of the outstanding shares of our common stock; (ii)
each of our executive officers and directors; and (iii) the our executive
officers and directors as a group.

Name and Address of                   Number of Shares             Percent
 Beneficial Owner                    Beneficially Owned (1)       of Class (2)
 ----------------                    ----------------------       ------------


Michael J. DeMeo                          13,200,000                 60.7%
1300 E. Hillsboro Blvd, # 102
Deerfield Beach, FL  33441


All directors and officers               13,2000,000                 60.7%
as a group (1 person)


(1) Except as otherwise indicated, we believe that the beneficial owners of our
common stock listed above, based on information furnished by such owners, have
sole investment and voting power with respect to such shares, subject to
community property laws where applicable.

(2) Percent of class is based on 21,751,033 shares of common stock outstanding
as of April 14, 2003.


ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

We are engaged in several transactions with a related party. This party is
another corporation, wholly owned by our majority stockholder.

We lease staff from the related party. For the period ending December 31, 2000,
we expensed $74,000 as salaries expense and $137,139 as sales commissions.

In 2000, the related party paid $150,000 as a down payment on the purchase of
the lease portfolio described in Note 5 to the financial statements contained
elsewhere is this Annual Report.

In 2000, we also purchased computer equipment and phone system equipment from
the related party in the total amount of $212,000.

In 2001, the related party advanced funds and paid certain of our expenses for
$170,023.

In 2001 we purchased a lease portfolio from the related party for $3,259,050.
The purchase price was equal to the outstanding bank note on the lease
portfolio.

During 2001 we leased office space owned by our Chief Executive Officer and
majority shareholder in the amount of $60,000 per year.

                                       11
<PAGE>

During 2002, we did not pay any rent on the office space owned by our Chief
Executive Officer and majority shareholder


ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K


                                  EXHIBIT INDEX

       The following exhibits are filed as part of this Annual Report on Form
10-KSB or are incorporated herein by reference:


<TABLE>
<CAPTION>
   EXHIBIT                                        DESCRIPTION                                       FILED
<S>             <C>                                                                                  <C>
3.1             Article of Incorporation of CarCorp USA Corporation (formerly Hydrox
                Sales Corp.), a Delaware corporation (1)                                             (1)
3.2             By-Laws of CarCorp USA Corporation (formerly Hydrox Sales Corp.), a
                Delaware corporation (1)                                                             (1)
5.1             Opinion of Warren Soloski, Esq. (1)                                                  (1)
10.1            Share Exchange Agreement dated January 26, 2001 (1)                                  (1)
10.2            Amendment to Share Exchange Agreement dated November 8, 2001 (1)                     (1)
10.3            Commercial Lease Agreement dated February 1, 2000 (2)                                (2)
10.4            Loan and Security Agreement between European American Bank and CarCorp USA,
                Inc. dated June 1, 2000 (2)                                                          (2)
99.1            Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
                Section 906 of the Sarbanes-Oxley Act of 2002 of Chief Executive Officer             (3)
</TABLE>


(1)      Incorporated by reference to the Exhibits to the Registration Statement
         filed by the Registrant on Form SB-2 (Commission File No. 333-73286)
         dated November 13, 2001.
(2)      Incorporated by reference to the Exhibits to the Registration Statement
         filed by the Registrant on Form SB-2 (Commission File No. 333-73286)
         dated January 10, 2002.
(3)      Filed herewith.


REPORTS FILED ON FORM 8-K

We filed a current report on Form 8-K on December 2002, announcing the change in
our independent public accountants, the change of our address and the
resignation of Mr. Claude Kirk as director on September 9, 2002 and the
resignation of Mr. Robert Minson as director on October 20, 2002.

                                       12
<PAGE>

ITEM 14. CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including
our Chief Executive Officer, we conducted an evaluation of the effectiveness of
our disclosure controls and procedures as defined in Rule 13a-14(c) promulgated
under the Securities Exchange Act of 1934 within 90 days of the filing date of
this report. Based on their evaluation, our Chief Executive Officer concluded
that the design and operation of our disclosure controls and procedures were
effective as of the date of the evaluation.

There have been no significant changes (including corrective actions with regard
to significant deficiencies or material weaknesses) in our internal controls or
in other factors that could significantly affect these controls subsequent to
the date of the evaluation referenced in the preceding paragraph.


                                   SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Action of 1934, as amended, the registrant has duly caused this Report to be
signed on its behalf by the undersigned, thereunto duly authorized.


                                             CARCORP USA CORPORATION

        April 24, 2003         By:           /s/ MICHAEL J. DEMEO
        --------------         -------------------------------------------------
             Date                                Michael J. DeMeo
                                               CHAIRMAN, PRESIDENT
                                           AND CHIEF EXECUTIVE OFFICER


     Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this Report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.


          SIGNATURE                         TITLE                     DATE

    /s/ MICHAEL J. DEMEO
------------------------------   Chairman, President and CEO      April 23, 2003
      Michael J. DeMeo           (principal accounting officer)

                                       13

<PAGE>

                                  EXHIBIT INDEX

       The following exhibits are filed as part of this Annual Report on Form
10-KSB or are incorporated herein by reference:

<TABLE>
<CAPTION>
   EXHIBIT                                        DESCRIPTION                                       FILED

<S>             <C>                                                                                  <C>
3.1             Article of Incorporation of CarCorp USA Corporation (formerly Hydrox
                Sales Corp.), a Delaware corporation (1)                                             (1)
3.2             By-Laws of CarCorp USA Corporation (formerly Hydrox Sales Corp.), a
                Delaware corporation (1)                                                             (1)
5.1             Opinion of Warren Soloski, Esq. (1)                                                  (1)
10.1            Share Exchange Agreement dated January 26, 2001 (1)                                  (1)
10.2            Amendment to Share Exchange Agreement dated November 8, 2001 (1)                     (1)
10.3            Commercial Lease Agreement dated February 1, 2000 (2)                                (2)
10.4            Loan and Security Agreement between European American Bank and CarCorp USA,
                Inc. dated June 1, 2000 (2)                                                          (2)
99.1            Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
                Section 906 of the Sarbanes-Oxley Act of 2002 of Chief Executive Officer             (3)
</TABLE>


(1)      Incorporated by reference to the Exhibits to the Registration Statement
         filed by the Registrant on Form SB-2 (Commission File No. 333-73286)
         dated November 13, 2001.
(2)      Incorporated by reference to the Exhibits to the Registration Statement
         filed by the Registrant on Form SB-2 (Commission File No. 333-73286)
         dated January 10, 2002.
(3)      Filed herewith.

                                       14
<PAGE>


                             CARCORP USA CORPORATION

                              FINANCIAL STATEMENTS

                           DECEMBER 31, 2002 AND 2001

        (With Report of Independent Certified Public Accountants Thereon)




                          L.L. Bradford & Company, LLC
                   Certified Public Accountants & Consultants
<PAGE>

                                TABLE OF CONTENTS

                                                                      Page No.
                                                                      --------

Report of Independent Certified Public Accountants                      F-1

Financial Statements

     Balance Sheet                                                      F-2

     Statements of Operations                                           F-3

     Statement of Stockholders' Deficit                                 F-4

     Statements of Cash Flows                                           F-5

Notes to Financial Statements                                           F-6

<PAGE>

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


To the Stockholders and Board of Directors
Carcorp USA Corporation
Fort Lauderdale, Florida

We have audited the accompanying balance sheet of Carcorp USA Corporation as of
December 31, 2002, and the related statements of operations, stockholders'
defcit and cash flows for the year then ended. 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. The financial
statements of the Company for the year ended December 31, 2001 were audited by
other auditors whose report dated April 12, 2002, expressed an unqualified
opinion on those statements.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit 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 audit 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 Carcorp USA Corporation as of
December 31, 2002, and the results of its operations and cash flows for the year
then ended in conformity with accounting principles generally accepted in the
United States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has suffered losses and current liabilities
exceed current assets, all of which raise substantial doubt about its ability to
continue as a going concern. Management's plans in regards to these matters are
also described in Note 1. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.


/s/ L.L. Bradford & Company, LLC
L.L. Bradford & Company, LLC
Las Vegas, Nevada
April 18, 2002

                                      F-1
<PAGE>

                            CARCORP USA CORPORATION
                                 BALANCE SHEET
                               DECEMBER 31, 2002


                                     ASSETS

Assets of discontinued operations held for sale                    $ 14,161,890
                                                                   -------------

TOTAL ASSETS                                                       $ 14,161,890
                                                                   =============


                      LIABILITIES AND STOCKHOLDERS' DEFICIT

Liabilities
    Liabilities of discontinued operations held for sale           $ 20,535,745
                                                                   -------------

      Total liabilities                                              20,535,745

Commitments and contingencies                                                --

Stockholders' deficit
    Common stock, $0.001 par value; 100,000,000 shares
      authorized, 19,951,033 shares issued and outstanding               19,951
    Additional paid-in capital                                        1,428,900
    Accumulated deficit                                              (7,822,706)
                                                                   -------------
      Total stockholders' deficit                                    (6,373,855)
                                                                   -------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                        $ 14,161,890
                                                                   =============

                 See Accompanying Notes to Financial Statements

                                      F-2
<PAGE>
<TABLE>

                                               CARCORP USA CORPORATION
                                              STATEMENTS OF OPERATIONS
<CAPTION>

                                                                          For the Year Ended        For the Year Ended
                                                                           December 31, 2002         December 31, 2001
                                                                           ----------------          ----------------

<S>                                                                        <C>                       <C>
Revenue                                                                    $            --           $            --

Operating expenses
    Stock based compensation and expenses                                        1,430,000                     3,851
    General and administrative                                                     104,251                   126,610
                                                                           ----------------          ----------------

      Total operating expenses                                                   1,534,251                   130,461
                                                                           ----------------          ----------------

Loss from continuing operations before provision for income taxes               (1,534,251)                 (130,461)

Provision for income taxes                                                              --                        --
                                                                           ----------------          ----------------

Loss from continuing operations                                                 (1,534,251)                 (130,461)

Income (loss) from discontinued operations, net of taxes                        (6,446,589)                1,061,816
                                                                           ---------------           ---------------

Net income (loss)                                                          $    (7,980,840)          $       931,355
                                                                           ================          ================

Earnings (loss) per common share - basic and diluted
    Loss from continuing operations                                        $         (0.08)          $         (0.01)
                                                                           ================          ================

    Income (loss) from discontinued operations                             $         (0.34)          $          0.06
                                                                           ================          ================

    Net income (loss)                                                      $         (0.08)          $          0.05
                                                                           ================          ================

Weighted average common shares outstanding -
    Basic and diluted                                                           19,236,786                18,851,033
                                                                           ================          ================

                                   See Accompanying Notes to Financial Statements

                                                         F-3
</TABLE>
<PAGE>
<TABLE>
                                                CARCORP USA CORPORATION
                                          STATEMENT OF STOCKHOLDERS' DEFICIT
                                    FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<CAPTION>

                                                 Common Stock              Additional                          Total
                                          ---------------------------       Paid-in        Accumulated     Stockholders'
                                             Shares          Amount         Capital          Deficit          Deficit
                                          ------------    ------------    ------------    ------------     ------------
<S>                                        <C>            <C>             <C>             <C>              <C>
Balance, December 31, 2000                 15,000,000     $    15,000     $        --     $  (773,221)     $  (758,221)

Issuance of common stock                    3,851,033           3,851              --              --            3,851
   in connection with the merger
   with Hydrox Sales Corp.

Net income                                         --              --              --         931,355          931,355
                                          ------------    ------------    ------------    ------------     ------------

Balance, December 31, 2001                 18,851,033          18,851              --         158,134          176,985

Issuance of common stock for services       1,100,000           1,100       1,428,900              --        1,430,000

Net loss                                           --              --              --      (7,980,840)      (7,980,840)
                                          ------------    ------------    ------------    ------------     ------------

Balance, December 31, 2002                 19,951,033     $    19,951     $ 1,428,900     $(7,822,706)     $(6,373,855)
                                          ============    ============    ============    ============     ============

                                    See Accompanying Notes to Financial Statements

                                                          F-4
</TABLE>
<PAGE>
<TABLE>
                                               CARCORP USA CORPORATION
                                              STATEMENTS OF CASH FLOWS
<CAPTION>

                                                                          For the Year Ended        For the Year Ended
                                                                           December 31, 2002         December 31, 2001
                                                                           ----------------          ----------------
<S>                                                                        <C>                       <C>
CASH FLOWS FROM OPERATING ACTIVITIES
    Net income (loss)                                                      $    (7,980,840)          $       931,355
    Less: income (loss) from discontinued operations                            (6,446,589)                1,061,816
                                                                           ----------------          ----------------
      Loss from continuing operations                                           (1,534,251)                 (130,461)
    Adjustments to reconcile net income (loss) to net cash
      used in operating activities:
        Stock based compensation and expenses                                    1,430,000                     3,851
                                                                           ----------------          ----------------

   Net cash used in operating activities of continuing operations                 (104,251)                 (126,610)

NET CASH PROVIDED BY DISCONTINUED OPERATIONS                                       104,251                   126,610
                                                                           ----------------          ----------------

NET CHANGE IN CASH                                                                      --                        --

CASH AT BEGINNING OF YEAR                                                               --                        --
                                                                           ----------------          ----------------

CASH AT END OF YEAR                                                        $            --           $            --
                                                                           ================          ================

SUPPLEMENTAL INFORMATION:
    Income taxes paid                                                      $            --           $            --
                                                                           ================          ================

                                   See Accompanying Notes to Financial Statements

                                                         F-5
</TABLE>
<PAGE>

                             CARCORP USA CORPORATION
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------

ORGANIZATION - Carcorp USA Corporation (the "Company"), formerly Hydrox Sales
Corp., was incorporated in the state of Delaware on February 4, 1999. Pursuant
to an agreement dated January 26, 2001, and amended on November 8, 2001, the
Company acquired Carcorp USA, Inc. ("Carcorp Inc."), a Florida corporation in a
transaction accounted for as a reverse merger. The Company issued 15,000,000
shares of its common stock for all of the issued and outstanding common stock of
Carcorp Inc. As a result, Carcorp Inc.'s former stockholder exercised control
over the Company. Prior to the merger, the Company had no business activity. The
accounting for the acquisition is identical to that resulting from a reverse
acquisition, except goodwill or other intangible assets are not recorded.
Accordingly, these financial statements are the historical financial statements
of Carcorp, Inc.

In December 2002, the Company loss the only funding source with Citicapital
formerly European American Bank ("Citi"), for it's vehicle leasing activities
and was unable to obtain any other funding sources. Furthermore, Citi
confiscated all leased vehicles returned to and/or repossessed by the Company,
which was financed by Citi. As a result of the foregoing factors, the Company
discontinued its vehicle leasing activities as of December 31, 2002. The Company
has accounted for this discontinuance as discontinued operations in accordance
with Statement of Financial Accounting Standards ("SFAS") No. 144, see Note 2
for additional discussion. Accordingly, the Company has reflected all activities
related to vehicle leasing operations as discontinued operations in the
accompanying financial statements. The Company has plans to sell the net assets
and liabilities related to the vehicle leasing activities to its Chief Executive
Officer and majority stockholder in exchange for shares of common stock in the
Company to which he owns. The terms of this sale have not been finalized
however, no gain or loss will be recognized upon the completion of this sale.
The Company believes it will finalize the sale with its Chief Executive Officer
and majority stockholder by the end of the second quarter of 2003.

As a result of the discontinued operations of the Company's vehicle leasing
activities, the Company's only activity as of December 31, 2002 is maintaining
its corporate affairs. On February 4, 2003, entered into a Share Exchange
Agreement with Elite Flight Solutions, Inc. ("Elite"), subject to the Company's
stockholders approval, whereby the Company will acquire all the outstanding
capital stock of Elite in exchange for 27,607,500 shares of the Company's common
stock, see Note 6 for additional discussion.

GOING CONCERN - The Company incurred a net loss of approximately $7,981,000 for
the year ended December 31, 2002. The Company's liabilities exceed its assets by
approximately $6,374,000 as of December 31, 2002. The Company's vehicle leasing
operations has been discontinued with no other source of operating revenues.
These factors create substantial doubt about the Company's ability to continue
as a going concern. The Company's management plans to continue as a going
concern revolves around its ability to complete the Share Exchange Agreement
with Elite, as well as, fund its operations with short term with a combination
of debt and equity financing.

The ability of the Company to continue as a going concern is dependent on
securing additional sources of capital and the success of the Company's plan.
The financial statements do not include any adjustments that might be necessary
if the Company is unable to continue as a going concern.

USE OF ESTIMATES - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenue and
expenses during the periods presented. Actual results could differ from those
estimates.

                                      F-6
<PAGE>

                             CARCORP USA CORPORATION
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
---------------------------------------------------

PROPERTY AND EQUIPMENT - Fixed assets are stated at cost less accumulated
depreciation. Depreciation is provided principally on the straight-line method
over the estimated useful lives of the assets, which are generally 5 to 7 years.
The amounts of depreciation provided are sufficient to charge the cost of the
related assets to operations over their estimated useful lives. The cost of
repairs and maintenance is charged to expense as incurred. Expenditures for
property betterments and renewals are capitalized. Upon sale or other
disposition of a depreciable property, cost and accumulated depreciation are
removed from the accounts and any gain or loss is reflected in other income.

The Company periodically evaluates whether events and circumstances have
occurred that may warrant revision of the estimated useful life of fixed assets
or whether the remaining balance of fixed assets should be evaluated for
possible impairment. The Company uses an estimate of the related undiscounted
cash flows over the remaining life of the fixed assets in measuring their
recoverability.

COMPREHENSIVE INCOME - In June 1998, the Financial Accounting Standards Board
("FASB") issued SFAS No. 130, "Reporting Comprehensive Income" was issued. SFAS
No. 130 establishes standards for the reporting and display of comprehensive
income and its components in the financial statements. As of December 31, 2002
and 2001, the Company has no items that represent comprehensive income and,
therefore, has not included a schedule of Comprehensive Income in the
accompanying financial statements.

INCOME TAXES - The Company accounts for its income taxes in accordance with SFAS
No. 109, which requires recognition of deferred tax assets and liabilities for
future tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their
respective tax bases and tax credit carryforwards. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in operations in the period that includes the
enactment date.

As of December 31, 2002, the Company has available net operating loss carryovers
of approximately $7,981,000 that will expire in various periods through 2022.
Such losses may not be fully deductible due to the significant amounts of
non-cash service costs. The Company has established a valuation allowance for
the full tax benefit of the operating loss carryovers due to the uncertainty
regarding realization.

STOCK-BASED COMPENSATION - The Company applies Accounting Principles Board
("APB") Opinion No. 25, Accounting for Stock Issued to Employees, and Related
Interpretations, in accounting for stock options issued to employees. Under APB
No. 25, employee compensation cost is recognized when estimated fair value of
the underlying stock on date of the grant exceeds exercise price of the stock
option. For stock options and warrants issued to non-employees, the Company
applies SFAS No. 123, Accounting for Stock-Based Compensation, which requires
the recognition of compensation cost based upon the fair value of stock options
at the grant date using the Black-Scholes option pricing model.

The Company issued no stock, neither granted warrants or options, to employees
for compensation for the years ended 2002 and 2001.

In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation-Transition and Disclosure". SFAS No. 148 amends the transition and
disclosure provisions of SFAS No. 123. The Company is currently evaluating SFAS
No. 148 to determine if it will adopt SFAS No. 123 to account for employee stock
options using the fair value method and, if so, when to begin transition to that
method.

FAIR VALUE OF FINANCIAL INSTRUMENTS - The carrying amounts of net liabilities of
discontinued operations approximate fair value because of the short-term nature
of this instrument.

                                      F-7
<PAGE>

                             CARCORP USA CORPORATION
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
---------------------------------------------------

NET INCOME (LOSS) PER COMMON SHARE - The Company computes net income (loss) per
share in accordance with SFAS No. 128, Earnings per Share and SEC Staff
Accounting Bulletin ("SAB") No. 98. Under the provisions of SFAS No. 128 and SAB
No. 98, basic net loss per share is computed by dividing the net loss available
to common stockholders for the period by the weighted average number of shares
of common stock outstanding during the period. The calculation of diluted net
loss per share gives effect to common stock equivalents, however, potential
common shares are excluded if their effect is antidilutive.

NEW ACCOUNTING PRONOUNCEMENTS - In November 2002, the Financial Accounting
Standards Board issued FASB Interpretation No. 45 ("FIN No. 45"), Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others an interpretation of SFAS No. 5, 57, and
107 and rescission of FASB Interpretation No. 34, was issued. FIN No. 45
clarifies the requirements of SFAS No. 5, Accounting for Contingencies, relating
to a guarantor's accounting for, and disclosure of, the issuance of certain
types of guarantees. The adoption of the provisions of FIN No. 45 did not have a
material impact on the Company's results of operations, financial position or
cash flows.

RECLASSIFICATION - The financial statements for 2001 reflect certain
reclassifications, which have nominal effect on net income, to conform to
classifications in the current year.

NOTE 2 - DISCONTINUED OPERATIONS
--------------------------------

As discussed in Note 1, the Company loss the only funding source for it's
vehicle leasing activities, unable to obtain any other funding sources, and Citi
confiscated all leased vehicles returned to and/or repossessed by the Company.
As a result of the foregoing factors, the Company discontinued its vehicle
leasing activities as of December 31, 2002. The Company has accounted for this
discontinuance as discontinued operations in accordance with SFAS No. 144.
Accordingly, the Company has reflected all activities related to vehicle leasing
operations as discontinued operations in the accompanying financial statements.
The Company has plans to sell the net assets and liabilities related to the
vehicle leasing activities to its Chief Executive Officer and majority
stockholder in exchange for shares of common stock in the Company to which he
owns. The terms of this sale have not been finalized however, no gain or loss
will be recognized upon the completion of this sale. The Company believes it
will finalize the sale with its Chief Executive Officer and majority stockholder
by the end of the second quarter of 2003.

The following is a summary of assets and liabilities from discontinued
operations by major classes as of December 31, 2002:

<TABLE>
<CAPTION>
<S>                                                                                     <C>
     Assets of discontinued operations held for sale:
       Investment in direct financing and operating leases, net                         $       14,061,230
       Property and equipment, net                                                                  96,440
       Other assets                                                                                  4,220
                                                                                        -------------------

         Total assets of discontinued operations held for sale                          $       14,161,890
                                                                                        ===================
     Liabilities of discontinued operations held for sale:
       Notes payable related to vehicle leases                                          $       19,728,028
       Accounts payable and accrued liabilities                                                    405,262
       Other liabilities                                                                           402,455
                                                                                        -------------------

         Total liabilities of discontinued operations held for sale                     $       20,535,745
                                                                                        ===================
</TABLE>

                                      F-8
<PAGE>

                             CARCORP USA CORPORATION
                          NOTES TO FINANCIAL STATEMENTS


NOTE 2 - DISCONTINUED OPERATIONS (continued)
--------------------------------

The following is a summary of activities from discontinued operations for the
year ended December 31, 2002 and 2001:

<TABLE>
<CAPTION>
<S>                                                          <C>                <C>
     Revenues                                                $     2,119,211    $     5,334,559
     Expenses                                                      8,565,800          4,291,522
                                                             ----------------   ----------------
       Income (loss) before provision for income taxes            (6,446,589)         1,043,037
     Provision for income taxes                                           --            111,682
                                                             ----------------   ----------------

       Income (loss) from discontinued operations            $    (6,446,589)   $       931,355
                                                             ================   ================
</TABLE>

NOTE 3 - RELATED PARTY TRANSACTIONS
-----------------------------------

During 2001 the Company leased an office space owned by its Chief Executive
Officer and majority stockholder in the amount of $60,000 per year. During 2002,
the Company was not required and did not pay any rent on the office space owned
by the Chief Executive Officer and majority stockholder.

In 2001, an entity owned by the Chief Executive Officer and majority stockholder
advanced funds and paid expenses on behalf of the Company for $170,023.

NOTE 4 - COMMITMENTS AND CONTINGENCIES
--------------------------------------

CITICORP LEASING, INC. LAWSUIT - In a lawsuit filed by Citicorp Leasing, Inc.,
as the assignee of European American Bank ("EAB") against Carcorp USA, Inc., on
or about October 18, 2002 and thereafter transferred to Broward County, Florida
on or about November 26, 2002, Case Number: 02-021680-CA (13), Citicorp Leasing
obtained a temporary restraining order wherein all matters regarding the EAB
portfolio originated or purchased by Carcorp USA, Inc., has been halted. A final
judgment was entered into in New York against Carcorp USA, Inc. on March 9,
2003. The judgment provided an award in favor of Citicorp Leasing, Inc. in the
amount of $14,706,912. The temporary restraining order previously entered in
favor of Citicorp Leasing, Inc. was made permanent. Carcorp USA, Inc. has filed
an Answer and Counter Claim and a responsive pleading is due by Citicorp
Leasing, Inc. on or before April 30, 2003. The Company believes that the total
amount awarded by the New York Court will be reduced by the amount of the value
of the lease portfolio. Accordingly, the Company believes it has recorded a
sufficient amount due to Citicorp Leasing, Inc. as of December 31, 2002 to
account for this claim. Nevertheless, Carcorp USA, Inc., believes is has a
number of counterclaims to this judgment and intends to defend against this
action vigorously.

BANKRUPTCY ACTION - An Adversarial Proceeding has been filed in the Bankruptcy
Court for the Southern District of Florida by the Trustee of Carcorp Inc.,
Soneet Kapila, Trustee, against Carcorp USA, Inc., Case Number 01-23742-BKC-PGH.
In this action, the Trustee seeks the turnover of motor vehicles or the value
thereof, for vehicles owned at one point in time by Carcorp Inc., and thereafter
sold to Carcorp USA, Inc., prior to the Chapter 11 filing by Carcorp Inc. In the
opinion of counsel retained by Carcorp USA, Inc., this matter was filed by the
Trustee in Bankruptcy to foreclose any transfers which may have occurred after
the bar date in the Chapter 11 proceeding filed by Carcorp Inc. Since no
evidence of improper transfers have been found to occur after the bar date, it
is the expectation of the Company's counsel that this action will be settled to
the satisfaction of all parties.

PAYROLL TAXES - The Company has been delinquent in making payroll deposits and
in filing of payroll tax returns for the year ended December 31, 2002. The
Company has accrued payroll taxes of $263,094, interest of $26,268, and
penalties of $28,342 in connection therewith.

                                      F-9
<PAGE>


                             CARCORP USA CORPORATION
                          NOTES TO FINANCIAL STATEMENTS


NOTE 5 - INCOME TAXES
---------------------

The Company did not record any current or deferred income tax provision or
benefit for any of the periods presented due to continuing net losses and
nominal differences.

The Company has provided a full valuation allowance on the deferred tax asset,
consisting primarily of net operating losses, because of uncertainty regarding
its realizability.

As of December 31, 2002, the Company had a net operating loss carry forward of
approximately $7,981,000 for federal income tax purposes to offset future
taxable income, if any. Utilization of the net operating loss carry forward,
which will expire in various periods through 2022, may be subject to certain
limitations under Section 382 of the Internal Revenue Code of 1986, as amended,
and other limitations under state and foreign tax laws. To the extent that net
operating losses of approximately $7,981,000, when realized, relate to stock
options and warrants, the resulting benefits will be credited to stockholders'
equity.

Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. As of December 31, 2002,
significant components of the Company's deferred tax assets are approximately as
follows:

Net operating loss                                             $      7,980,840
Stock based compensation                                             (1,430,000)
                                                               -----------------
         Total deferred tax assets                                    6,550,840
         Valuation allowance for deferred tax assets                 (6,550,840)
                                                               -----------------

         Net deferred tax assets                               $             --
                                                               =================

NOTE 6 - SUBSEQUENT EVENT
-------------------------

On January 15, 2003, the Company consummated a consulting agreement with its
Chief Executive Officer and majority stockholder whereby he will provide
business advice, management, and product development and marketing services in
exchange for 1,800,000 shares of the Company's common stock. The fair value of
this consulting agreement totals $162,000 or $0.09 per share.

As discussed in Note 1, on February 4, 2003, the Company entered into a Share
Exchange Agreement with Elite, subject to the Company's stockholders approval,
whereby the Company will acquire all the outstanding capital stock of Elite in
exchange for 27,607,500 shares of the Company's common stock. Upon completion of
this transaction, the Company will account for this business combination under
the purchase accounting method in accordance with SFAS No. 141, whereby the
Company will record the purchase of Elite using the fair value of common stock
issued and record the difference with the net book value of Elite as intangible
assets. Elite is a provider of public air transportation and air jet charter
services.

                                      F-10