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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

COMMISSION FILE NUMBER 333-89061

HOLLEY PERFORMANCE PRODUCTS INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

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

        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 ý    No o

There were 1,000 shares of Common Stock outstanding as of September 29, 2002.

HOLLEY PERFORMANCE PRODUCTS INC.
Quarterly Report on Form 10-Q
For the Nine Months Ended September 29, 2002

TABLE OF CONTENTS

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PART I—FINANCIAL INFORMATION

ITEM 1—FINANCIAL STATEMENTS

HOLLEY PERFORMANCE PRODUCTS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2001 AND SEPTEMBER 29, 2002
(Dollars in Thousands)
(Unaudited)

See accompanying notes.

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HOLLEY PERFORMANCE PRODUCTS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Thousands)
(Unaudited)

See accompanying notes.

4

HOLLEY PERFORMANCE PRODUCTS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY (DEFICIT)
(Dollars in Thousands)
(Unaudited)

See accompanying notes.

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HOLLEY PERFORMANCE PRODUCTS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)

See accompanying notes.

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HOLLEY PERFORMANCE PRODUCTS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share amounts)
(Unaudited)

1. ORGANIZATION AND BASIS OF PRESENTATION

        Holley Performance Products Inc. (the "Company" or "Holley"), a Delaware corporation based in Bowling Green, Kentucky, is a leading manufacturer of a diversified line of performance automotive products, including carburetors, fuel pumps, fuel injection systems, ignition systems, remanufactured carburetors, camshafts, crankshafts, pistons, superchargers, exhaust headers, mufflers, engine plumbing products, and nitrous oxide systems. The products are designed to enhance street, off-road, recreational and competitive vehicle performance through increased horsepower, torque and driveability. In addition to its automotive performance line, Holley manufactures performance products for the powersport, marine and motorcycle markets.

        The consolidated balance sheets of the Company as of December 31, 2001 and September 29, 2002, and the consolidated statements of operations for the three- and nine-month periods ended September 30, 2001 and September 29, 2002, and the consolidated statements of cash flows for the nine month periods ended September 30, 2001 and September 29, 2002 are unaudited, except for the condensed consolidated balance sheet dated December 31, 2001, which is derived from audited financial statements, and have been prepared by the Company in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.

        In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and changes in cash flows at September 30, 2001 and September 29, 2002 and for all periods presented have been made. The results of operations for the periods ended September 29, 2002 and September 30, 2001 are not necessarily indicative of the operating results to be expected for the full year.

        The Company incurred net losses in 1999, 2000, 2001 and the first three quarters of 2002. Management is presently evaluating the performance of the Company's business both in the aggregate and at the separate division levels. To date in 2002, management has implemented actions designed to reduce working capital and improve operating results, and plans further actions during the remainder of 2002. There is no assurance that management's actions will be successful. The consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

2. RESTATEMENT OF FINANCIAL STATEMENTS

        As disclosed in further detail in the Company's Form 10-K for the year ended December 31, 2001, the Company has restated its unaudited financial information for 2001 that had previously been released by the Company. As a result, the comparative information contained in this quarterly report

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on Form 10-Q with respect to the three- and nine-month periods ended September 30, 2001 has been restated. Amounts as previously reported and as restated are as set forth below:

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        The Company has significant intangible assets related to goodwill and other acquired intangible assets. The determination of related estimated useful lives and whether or not these assets are impaired involves significant judgments. Changes in strategy and/or market conditions could significantly impact these judgments and require adjustments to recorded asset balances.

        The Company continually evaluates whether events and circumstances have occurred that indicate the remaining useful lives of the intangible assets may warrant revision or that the remaining balance of such assets may not be recoverable. When factors indicate that such assets should be evaluated for possible impairment, the Company uses an estimate of the related operation's undiscounted cash flows over the remaining lives of the assets in measuring whether the asset is recoverable. If this review indicates that the intangible asset will not be recoverable based on undiscounted cash flows of the related assets, the Company writes down the intangible asset to estimated fair value.

        As of January 1, 2002, the Company adopted Statement of Financial Accounting Standards ("SFAS") No. 142, "Goodwill and Other Intangible Assets", which addresses the financial accounting and reporting standards for the acquisition of intangible assets outside of a business combination and for goodwill and other intangible assets subsequent to their acquisition. This accounting standard requires that goodwill be separately disclosed from other intangible assets in the balance sheet, and no longer be amortized but tested for impairment on a periodic basis.

        In accordance with the transition provisions of SFAS No. 142, the Company has completed the first step of the transitional goodwill impairment test for all the reporting units of the Company. The results of that first step have indicated that goodwill of Holley Performance, Lunati, Hooker, Earl's, and So-Cal, which are included in the reportable segment entitled "Performance Parts", may be impaired and an impairment loss may have to be recognized. The amount of that loss has not been estimated, and the measurement of that loss is expected to be completed prior to the end of the fourth quarter of 2002. Any resulting impairment loss will be recognized as a cumulative effect of a change in accounting principle and reflected in the first quarter of 2002.

        In addition, the Company has reviewed its trade names for impairment in accordance with the transition provisions of SFAS No. 142 using fair value measurement techniques and has recorded a noncash pretax impairment charge of $3,400 related to the "Lunati" and "Holley" trade names. The impairment charge is non-operational in nature and has been reflected as a cumulative effect of an accounting change in the first quarter of 2002.

        In accordance with SFAS No. 142, the Company discontinued the amortization of goodwill and indefinite lived intangible assets effective January 1, 2002. A reconciliation of previously reported net

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loss to the pro forma amounts adjusted for the exclusion of amortization on goodwill and indefinite lived intangibles assets, net of the related income tax effect, follows:

COMPREHENSIVE INCOME

        SFAS No. 130, "Reporting Comprehensive Income", sets forth standards for reporting and displaying components of comprehensive income (loss) in a full set of general purpose financial statements. Comprehensive income (loss) encompasses all changes in stockholder's equity (except those arising from transactions with owners) and includes net income or loss, net unrealized capital gains or losses on available for sale securities and foreign currency translation adjustments. Comprehensive loss for the periods ended September 30, 2001 and September 29, 2002 was the same as net loss for the Company.

RECENT ACCOUNTING PRONOUNCEMENTS

        In August 2001, the Financial Accounting Standards Board ("FASB") issued SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets", which supersedes SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of", and the accounting and reporting provisions of APB Opinion 30, "Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions". SFAS No. 144 removes goodwill from its scope and clarifies other implementation issues related to SFAS No. 121. SFAS No. 144 also provides a single framework for evaluating long-lived assets to be disposed of by sale. The provisions of this Statement were adopted effective January 1, 2002, and had no material effect on the Company's results of operations or financial position.

        SFAS No. 145, "Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13 and Technical Corrections," issued in April 2002, among other things, rescinds SFAS No. 4 which required material gains and losses from extinguishment of debt to be classified as an extraordinary item, net of related income tax effect. SFAS No. 145, which applies to all entities, is effective for fiscal years beginning after May 15, 2002, with early adoption encouraged. The Company early adopted the Statement effective January 1, 2002. Accordingly, the $775 loss from debt extinguishment discussed in Note 7 is included as an ordinary loss in the consolidated statement of operations for the three months and nine months ended September 29, 2002.

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4. INVENTORIES

        Inventories of the Company consist of the following:

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5. PROPERTY, PLANT AND EQUIPMENT

        Property, plant and equipment of the Company consist of the following:

        Depreciation expense was $5,973 and $5,124 for the nine months and $1,966 and $1,567 for the three months ended September 30, 2001 and September 29, 2002, respectively.

6. ACCRUED LIABILITIES

        Accrued liabilities of the Company consist of the following:

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7. LONG-TERM DEBT

        Long-term debt of the Company consists of the following:.

        In December 2000, the Company entered into a credit agreement with Fleet Capital Corporation (the "Fleet Credit Arrangement") which included both a revolving credit facility and a term loan to be utilized for capital expenditures. The Fleet Credit Arrangement required that the Company meet certain interest coverage ratios each quarter. The Company was not in compliance with the interest coverage ratio covenant for the quarters ended March 31, 2002 and June 30, 2002. The Company received a waiver of the interest coverage ratio covenant from Fleet for the quarters ended March 31, 2002 and June 30, 2002. On July 30, 2002, prior to the expiration of the forbearance agreement, the Company replaced the Fleet Credit Arrangement with a $50 million facility provided by Foothill Capital Corporation (the "Credit Agreement").

        The five-year Credit Agreement is comprised of four parts: 1.) a revolving component, with borrowings limited to 85% of eligible trade accounts receivable and the lesser of $16 million or 68% of eligible finished goods inventory plus 17% of eligible work-in-process inventory plus 31% of eligible raw materials inventory; 2.) Subline A with available advances totaling a maximum of $10 million secured by the Company's equipment, real property and trade names; 3.) Subline B of $10 million and 4.) Subline C with available advances totaling $5 million for the purchase of new capital equipment. Maximum borrowings under the Credit Agreement are limited under the terms of the Company's Senior Notes Indenture to $45 million (as amended, See Note 11). The Credit Agreement, as amended, requires that the Company maintain certain fixed charge coverage ratios beginning the twelve months ending June 30, 2003. In connection with the Credit Agreement, the Company wrote-off $775 of deferred financing costs associated with the Fleet Credit Arrangement. Such amount is included in other expense in the accompanying consolidated statements of operations.

        At October 25, 2002, the Company had $8.3 million of unused credit availability under the Credit Agreement.

        On September 20, 1999, the Company issued $150.0 million of 12¹/4% senior notes due 2007 at a discount of 3.7% (the "Senior Notes"). The debt discount is amortized as a non-cash charge to interest expense using the effective interest method over the term of the debt. The Senior Notes are unsecured

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and are subordinate to the Company's other indebtedness. The proceeds from the Senior Notes were used to repay existing indebtedness and to fund the acquisitions of FlowTech, NOS and Earl's in October 1999.

        The Senior Notes Indenture requires the Company to make semi-annual interest payments in March and September at 12¹/4%. On September 15, 2002, the Company delayed making its semi-annual interest payment on the Senior Notes. In September 2002, the Company initially received a $2 million cash infusion from its parent company in the form of a short-term note to meet operating requirements. The Company subsequently received an additional $13 million cash infusion for a total investment of $15 million and the Company made the interest payment on October 15, 2002, before the grace period specified in the Senior Notes Indenture expired (See Note 11). Accordingly, amounts payable under the Senior Notes Indenture are classified as long-term in the accompanying consolidated balance sheet at September 29, 2002.

        The Credit Agreement and the Senior Notes were amended on October 10, 2002. See Note 11.

        In connection with the revolving credit facility, the Credit Agreement requires lock-box agreements which provide for all receipts to be swept daily to reduce borrowings outstanding. These agreements, combined with the existence of a Material Adverse Effect (MAE) clause in the Credit Agreement, cause the revolving credit facility to be classified as a current liability, per guidance in the FASB's Emerging Issues Task Force 95-22, "Balance Sheet Classification of Borrowings Outstanding under Revolving Credit Agreements that Include Both a Subjective Acceleration Clause and a Lock-Box Arrangement." The MAE clause, which is a typical requirement in commercial credit agreements, allows the lender to require the loan to become due if it determines there has been a material adverse effect on the operations, business, properties, assets, liabilities, condition or prospects. The classification of the revolving credit facility as a current liability at September 29, 2002, is a result of the combination of the two aforementioned factors: the lock-box agreements and the MAE clause. However, the revolving credit facility does not expire or have a maturity date within one year, but rather has final expiration date of July 30, 2007.

8. COMMITMENTS AND CONTINGENCIES

        The Company is a party to various lawsuits and claims in the normal course of business. While the lawsuits and claims against the Company cannot be predicted with certainty, management believes that the ultimate resolution of the matters will not have a material effect on the financial position or results of operations of the Company.

        In May 1999, Union Pacific Railroad Company filed an action against Weiand Automotive Industries, Inc., a subsidiary of Holley ("Weiand"), and others in the U.S. District Court for the Central District of California, alleging that certain soil and groundwater contamination discovered on Union Pacific property in Los Angeles had migrated from an adjacent Weiand facility. In December 2000, Union Pacific, Holley, Weiand and Joan Weiand, the owner of the Weiand property, reached a comprehensive settlement in exchange for a cash payment significantly less than the sought amount, resulting in a full dismissal of the lawsuit. A substantial majority of the settlement payment was paid by Weiand's insurers. In connection with the settlement, an additional $550 paid by the settling insurers has been put into a Site Source Control Account to fund investigation and any required remediation of the Weiand property, as may be required by the State of California.

        In 2000, Weiand discovered possibly significant soil contamination on the Weiand property, which has not been fully analyzed by Weiand's environmental consultants. In July 2001, Holley (through Weiand) entered into a Voluntary Cleanup Agreement with the California Department of Toxic Substances Control, pursuant to which Holley is working with the property owner, Joan Weiand, to investigate and, if necessary, remediate the contamination. Holley cannot estimate the potential liability arising from that contamination, if any, or the possible outcome of any state environmental regulatory

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requirements. Holley and Weiand are working vigorously to address regulatory issues arising from the discovered contamination.

        The Company, like others in similar businesses, is subject to extensive federal, state and local environmental laws and regulations. Although Company environmental policies and practices are designed to ensure compliance with these laws and regulations, future developments and increasingly stringent regulation could require the Company to make unforeseen environmental expenditures.

        The Company has established a severance plan for certain members of management. Under the terms of the severance plan, the participants are entitled to certain severance benefits, which include salary continuation, in the event the participant is terminated by the Company without cause.

        During 2002, legislation was passed which allows companies to carry back net operating losses incurred in 2001 and 2002 for up to five years. In years prior to 2001 and years beyond 2002 the period for loss carry back is two years. The Company intends to submit a claim through a tax sharing arrangement with the prior owner to carry back a portion of its 2001 net operating losses and receive a refund for taxes previously paid. As the Company has a full valuation allowance against its net operating losses, any refunds received will result in income tax benefit. As of the date of this report, no claims have been submitted nor have any refunds been received.

9. SEGMENT DATA

        The Company's reportable segments have a common management team and infrastructure, however, due to the different nature of the products sold by each segment, the Company monitors each segment's revenues and gross margin on a standalone basis when making strategic decisions regarding the allocation of Company resources.

        The Company has two reportable segments: Performance Parts and Remanufactured Parts. The Company manufactures high performance aftermarket automotive parts through its Performance Parts segment. Under its Remanufactured Parts segment, the Company refurbishes used automotive part cores and then resells the parts as remanufactured products. Both segments sell primarily to automotive parts distributors throughout the United States.

        The accounting polices of the reportable segments are the same as those described in the Company's annual financial statements and should be read in conjunction with the notes thereto. The Company evaluates the performance of its reportable segments based on gross margin. Intersegment sales and transfers are not significant.

        Summarized financial information concerning the Company's operating measures for the reportable segments are shown in the following table:

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        Summary balance sheet data for inventories and property, plant, and equipment, net for each of the Company's reportable segments as of December 31, 2001 and September 29, 2002 are shown in the following table:

10. FINANCIAL INFORMATION FOR GUARANTORS OF THE COMPANY'S DEBT

        The Senior Notes are guaranteed by substantially all existing and future directly or indirectly wholly-owned domestic restricted subsidiaries of the Company ("the Guarantors"). The Guarantors irrevocably and unconditionally, fully, jointly and severally guarantee the performance and payment, when due, of all obligations under the Senior Notes.

        The condensed consolidating financial information includes certain allocations of revenues and expenses based on management's best estimates which is not necessarily indicative of financial position, results of operations and cash flows that these entities would have achieved on a stand-alone basis and should be read in connection with the consolidated financial statements of the Company. Condensed consolidating financial information for the issuer (Holley Performance Products, Inc.) and the subsidiary Guarantors is set forth below.

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Consolidating Balance Sheet
September 29, 2002

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Consolidating Balance Sheet
December 31, 2001

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Consolidating Statement of Operations
Three Months Ended September 29, 2002

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Consolidating Statement of Operations
Nine Months Ended September 29, 2002