$10k for that car is fair. $7k would be theft if its as straight as it looks. Take it to a body shop and have them put it up on the lift and check it over with a paint thickness gauge for bondo. If it comes out clean I'd offer $7k and bring $9k, cash. I wouldn't like to pay more than $8k for it, but I'm cheap.
$5k is an insulting offer. Don't even attempt to start there.
As far as upgrades. you'd have to know the provenance of the car before going forward. If its currently in its original state then I wouldn't mess with it much (factory 4 speed is a big win). Maybe H/C/I swap and keep the original stuff on a shelf, packing in grease, for the next buyer.
Last edited by Maxwelhse; 07-03-2014 at 04:56 PM.