U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL
BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
TriTec Industries, Inc.
(Name of Small Business Issuer in its charter)
Nevada 41-1805437
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
7901 Flying Cloud Drive
Eden Prairie, Minnesota 55344
(Address of principal executive office) (Zip Code)
Issuer's telephone number (612) 942-5282
Securities to be registered under Section 12(g) of the Act:
Common Shares
Charles Clayton
527 Marquette
Minneapolis, Minnesota 55402
(612) 338-3738
(Agent for Service)
<PAGE>
ITEM 1. DESCRIPTION OF BUSINESS
TriTec Industries, Inc. was first formed as a Minnesota corporation in
October, 1994. It was formed as a holding company for Placer Recovery Systems,
Inc., Earth Technologies, Inc. and Pit Bull Industries, Inc. The principal
business was the Placer Recovery Systems, Inc., which was a successor to the E.
F. Domine Company, as a manufacturer of placer mining equipment. The domicile of
TriTec Industries, Inc. was moved to Nevada in June, 1996 when it was
incorporated in Nevada.
The Company's line of placer mining equipment was manufactured and sold
by the E. F. Domine Company beginning in 1981. Placer Recovery Systems, Inc.
manufactured and sold the same equipment beginning in 1991, and, since 1994, it
has been manufactured and sold under the name of TriTec Industries, Inc. The
equipment is used for the recovery of precious metals from surface deposits left
by alluvial or glacial activity. The equipment is also used for crushing and the
recovery of precious metals in small hard rock mining.
The equipment is known as "The Gold Claimer" and "The Rotary Riffle,"
with ancillary and supporting recovery and grinding equipment. These come in a
variety of sizes and prices. The rotary riffle design produces high recovery
rates of precious metals and the equipment is portable, self contained and multi
functional. The equipment is in a variety of sizes ranging from five to two
hundred tons per hour, and in price from $6,000 to $360,000.
The Company has also made preliminary steps to begin business in
Guyana, South America. It has established a corporation named Gold Hill
Holdings, Inc. in Barbados. That corporation is owned 47.5% by the Company, 2.5%
by Earth Technologies, Inc. (an affiliated corporation), 20% by A & A
International Industries, Inc., 20% by Pacrim Information Systems, Inc. and 10%
by AIC International Resources Corporation; the last three companies are located
in Vancouver, British Columbia, Canada. Gold Hill Holdings, Inc. is in turn the
100% owner of Gold Hill (Guyana) Incorporated, a Guyana corporation.
Gold Hill (Guyana) Incorporated obtained a membership in the Gold &
Diamond Miners' Association on August 27, 1997, and a license to trade in
valuable minerals and precious stones on September 2, 1997, and has opened an
office in Georgetown, Guyana.
Gold and diamonds are mined in Guyana by many small miners, locally
called "porknockers" who then trade the gold and diamonds they mine for goods in
a barter system. Gold and diamonds are also mined by natives, called
"Amerindians" who also trade the gold and diamonds for goods in a barter system.
The prices charged for the goods bartered to the porknockers and Amerindians are
much higher than charged for similar goods in the United States, with the result
that in many instances it is less expensive to trade for the gold and diamonds
than to mine them.
<PAGE>
The Company is also in negotiations for leases on real estate in Guyana
to mine for gold and diamonds. It is the intent of the Company to use its mining
equipment, after it is sold to Gold Hill (Guyana) Incorporated, which is far
more efficient than the local methods used.
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS
The Company has operated at a loss for several years. Revenues from
sales increased from 1995, $128,862, to 1996, $423,128, however, because of cost
of sales and operating expenses the loss was greater in 1996, $611,263 than in
1995 $312,195. Revenues from sales decreased dramatically in the first 7 months
of 1997 to $30,358, resulting in a loss for the 7 months of $225,234.
Management of the Company feels that the falling sales are a result of
the falling price of gold and the cost of its equipment to miners that are
unable to afford the equipment. Discussions with prospective customers reveal
that the customers like the mining equipment, but are unable to pay for it.
The Company has six loans that comprise its long term debt. All of them
are now in default. In addition the plant where the mining machinery was
manufactured has been foreclosed and is no longer available to the Company. The
Company has been using a subcontractor for manufacturing a substantial portion
of the equipment with the Company's personnel at the site to oversee and
finalize the equipment.
There were amounts due from related parties, which were written off of
$47,414 in 1995 and $361,325 in 1996. The officers' ability to repay their part
of the amount due is based on the future earnings of the Company. The Auditor
for the Company issued a going concern opinion, and because of a deficiency of
assets the amounts were written off.
Management of the Company decided upon a new course of business faced
with the declining sales of its equipment. The result was an alliance with A & A
International Industries, Inc., Pacrim Information Systems, Inc. and AIC
International Resources Corporation to form the Barbados and Guyana companies
and engage in trading for gold and diamonds in Guyana and using the mining
equipment of the Company for mining of gold and diamonds in Guyana.
The Vancouver companies contributed $70,000 to the Guyana company for
the purchase of a mining machine, which was sold to the Guyana company by TriTec
for the $70,000. It is hoped that the mining business in Guyana will be
profitable and will enable returns to be made to the Company. In addition the
Company will attempt to trade goods for gold and diamonds in Guyana at a profit
to bring further cash to the Company, and enable it to survive.
<PAGE>
Management feels that its strongest assets are its mining equipment
with good technology, and its contacts in the mining industry throughout the
world. It is now using both assets to enter into the mining business itself
through its alliance with the Vancouver companies. This will lead to sales of
the equipment to work the mining claims it partially owns, and income from the
mining operations.
ITEM 3. DESCRIPTION OF PROPERTY
The Company owns no property. The Company leases 3,163 square feet of
office space in suburban Minneapolis, Minnesota at a monthly gross rental of
$4,080 through May 31, 2000, with a five year renewal option and additional rent
based on variations in operating costs. The Company is not now current on its
rent at the leased office space.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the information as to the ownership of
each person who owns of record, or is known by the Company to own beneficially,
more than five per cent of the Company's common and preferred stock, and the
officers and directors of the Company.
COMMON STOCK
Name Shares Percent
---- ------ -------
Eugene Chessen 850,000 32%
Willis Black 700,000 26%
John McManus 300,000 11%
Directors and Officers as 1,850,000 58%
a group
PREFERRED STOCK
Eugene Chessen 100,000 40%
Willis Black 100,000 40%
John McManus 50,000 20%
Directors and Officers as 250,000 100%
a group
<PAGE>
The Company has an agreement to issue 1,000,000 of its shares at $.01
per share to A & A International Industries, Inc. In addition the shares include
a one year option to purchase an additional 1,000,000 shares at $1.00 per share;
the shares available through option have warrants to acquire an additional
1,000,000 shares at $1.25 per share for a period of two years. The initial
deposit of $10,000 has been received, however, the related shares have not been
issued.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The executive officers and directors of the company, with a brief
description are as follows:
Name Age Position
- ---- --- --------
Eugene Chessen 56 Chairman of the Board/Director
Willis Black 50 President/Director
John McManus 65 Vice President/Director
James O'Neill 52 Director
Michael Burns 52 Director
Eugene Chessen, Chairman of the Board. Mr. Chessen is a founder of the
Company and has served as CEO of Placer Recovery Systems, Inc. since 1991. He
has also been President of Chessen's Restaurants, Inc. of Minneapolis since
1988.
Willis Black, President and a Director. Mr. Black has been the Vice
President of Placer Recovery Systems, Inc. since 1992.
John McManus, Vice President and a Director. Mr. McManus has been Vice
President of Sales for Placer Recovery Systems, Inc. since 1991. Mr. McManus is
a graduate of Boston University.
James O'Neill, a Director. Mr. O'Neill has been the President, Chief
Operating Officer of the O'Neill Real Estate Group and J. F. O'Neill and
Associates, both real estate companies, since 1983.
Michael Burns, a Director. Mr. Burns is an attorney, he practiced law
in Minneapolis, and for more than the past five years has been the owner of
Burns and Associates, a government relations business.
<PAGE>
ITEM 6. EXECUTIVE COMPENSATION
Eugene Chessen is paid $5,000 per month; he has options to purchase
250,000 shares of common stock of the Company at $2.00. He is also given health
and disability insurance and an automobile allowance.
Willis Black is paid $5,000 per month; he has options to purchase
250,000 shares of common stock of the Company at $2.00. He is also given health
and disability insurance and an automobile allowance.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Eugene Chessen and Willis Black were given advances of $181,239 in
prior years as advances. Their ability to repay the money is dependent on the
future earnings of the Company, and that amount was accordingly written off. The
balances due from related parties carried on the financial statements represent
amounts subsequently received.
ITEM 8. LEGAL PROCEEDINGS
The Southwest Initiative Fund held a mortgage on the Walnut Grove
property of the Company. It filed a foreclosure suit and there was a Sheriff's
sale of the property on March 24, 1997.
There was a mechanic's lien filed by Lamberton Distributing Company in
the amount of $16,866.
There have been judgments entered in debt collection cases in favor of
W. W. Grainger for $7,709, Ron Alley for $830, AT & T Wireless for $1,224 and
Thomas Publishing for $3,515.
ITEM 9. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS
There is not, and there has never been, a market for the common shares
of the Company. There are 78 holders of the common stock of the Company.
ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES
Name Date Shares Cost
Eugene Chessen 12/94 700,000
<PAGE>
Willis Black 12/94 700,000
Mable Lueders and Ardele Chessen 12/94 150,000
John McManus 3/95 150,000
John Oertle 3/95 10,000 10,000
James O'Neill 4/95 25,000
Devon Capital USA 5/95 25,000
Christian and Jean Christensen 10/95 1,000 1,000
Ronald Moline 10/95 5,000 5,000
Harold and Sharon Hoffman 12/95 5,000 5,000
Community National Bank 1/96 15,000 15,000
Christian and Jean Christensen 1/96 9,000 9,000
Robert Penny 1/96 5,000 5,000
Christian and Jean Christensen 1/96 8,000 8,000
Diane Norris 1/96 5,000 5,000
Kenneth Chupita 1/96 4,000 4,000
Sharon Waller 1/96 10,000 10,000
Harold and Sharon Hoffman 1/96 15,000 15,000
Harold and Sharon Hoffman 2/96 5,000 5,000
Gary Huff 2/96 18,888 18,888
Jonathan Swanson 2/96 6,000 6,000
Joseph and Julia Sadek 2/96 5,000 5,000
Prehap Reddy 2/96 5,000 5,000
Steven Cheney 3/96 5,000 5,000
Richard Neslund 10/96 103,507 100,000
Paul and Linda Swanson 3/96 6,250 6,250
Community National Bank 3/96 5,000 5,000
Diana Norris 3/96 15,000 15,000
Michael Burns 3/96 5,000
Harold and Sharon Hoffman 3/96 25,000 25,000
Michael and Carole Greco 3/96 6,000 6,000
Vincent Masucci 3/96 5,000
Leonard Brink 3/96 7,500 7,500
Gary Harms 3/96 5,000 5,000
Richard Shope 4/96 7,500 7,500
Curtis Delgard 4/96 5,000 5,000
Carl and Jean Nyberg 4/96 4,000 4,000
Peter Veldman 4/96 6,000 6,000
Gary Trueblood 4/96 5,000 5,000
Paul and Linda Swanson 4/96 3,500 3,500
Carol Weingeist 4/96 10,000 10,000
Kenneth Chupita 4/96 2,000 2,000
Ronald Moline 4/96 5,000 5,000
Community National Bank 4/96 5,000 5,000
Neil Friedman 4/96 10,000 10,000
George Guritz 4/96 5,000 5,000
Kevin Macken 4/96 5,000 5,000
<PAGE>
Paul and Linda Swanson 4/96 10,250 10,250
Harold and Sharon Hoffman 4/96 10,000 10,000
Harry Vennemann 4/96 5,000 5,000
Leonard and Alvina Brink 4/96 2,500 2,500
David Vennemann 4/96 5,000 5,000
Steven Weiland 4/96 2,500 2,500
Earl Holdridge 4/96 5,000 5,000
Joseph and Marion Vahl 4/96 5,000 5,000
Robert and Debra Greenberg 5/96 5,000 5,000
Christian and Jean Christensen 5/96 3,000 3,000
Dale Meyer 5/96 2,500 2,500
Kenneth Preimesberger 6/96 6,000 6,000
Edward Atkins 6/96 10,000 10,000
Robert Stein 6/96 5,000 5,000
Douglas and Melissa Adler 6/96 5,000 5,000
Charles Rosenberg 6/96 5,000 5,000
Jonathan Swanson 6/96 9,000 9,000
Fred Caslavka 6/96 5,000 5,000
Community National Bank 7/96 15,329 15,329
Gary Huff 7/96 14,000 14,000
Thomas Tutin 7/96 5,000 5,000
Harold and Sharon Hoffman 7/96 8,800 8,800
Shirley Beise 7/96 10,000 10,000
William Kuban 7/96 5,000 5,000
Eugene Matson 7/96 5,000 5,000
Paul Bearman 7/96 5,000 5,000
Peter Veldman 7/96 4,000 4,000
Community National Bank 7/96 4,448 4,448
Christian and Jean Christensen 7/96 24,000 24,000
Community National Bank 8/96 11,428 11,428
Community National Bank 8/96 11,000 11,000
Community National Bank 8/96 14,000 14,000
Community National Bank 8/96 5,000 5,000
Christian and Jean Christensen 9/96 3,000 3,000
Amando Balzer 9/96 5,000 5,000
Christian and Jean Christensen 9/96 2,000 2,000
Michael Wheelock 10/96 15,000
David Eggert 10/96 15,000
Camilia Parrott 10/96 5,000 5,000
Kathleen Trorn 10/96 10,000 10,000
Paul Beamon 10/96 1,000 1,000
Delores Johnson 10/96 5,000 5,000
George Guritz 11/96 20,000
Carol Weingeist 1/97 10,000 10,000
George Guritz 1/97 40,000
Community National Bank 2/97 3,130 3,130
<PAGE>
Arnold Holing 2/97 20,000 20,000
The registrant believes that all transactions were transactions not
involving any public offering within the meaning of Section 4(2) of the
Securities Act of 1933, since (a) each of the transactions involved the offering
of such securities to a substantially limited number of persons; (b) each person
took the securities as an investment for his own account and not with a view to
distribution; (c) each person had access to information equivalent to that which
would be included in a registration statement on the applicable form under the
Act; (d) each person had knowledge and experience in business and financial
matters to understand the merits and risk of the investment; therefore no
registration statement need be in effect prior to such issuances.
ITEM 11. DESCRIPTION OF SECURITIES
The company has authorized 36,000,000 shares of stock, $.001 par value,
35,000,000 shares have been designated as common shares, and the remaining
1,000,000 shares are preferred shares. Each holder of common stock has one vote
per share on all matters voted upon by the shareholders. The voting rights are
cumulative. There are no preemptive rights or other rights of subscription.
Each share of common stock is entitled to participate equally in
dividends as and when declared by the Board of Directors of the company out of
funds legally available, and is entitled to participate equally in the
distribution of assets in the event of liquidation. All shares, when issued and
fully paid, are nonassessable and are not subject to redemption or conversion
and have no conversion rights.
The preferred shares are convertible into 10 common shares at a price
of $1.00 per share for a period of 10 years. The preferred shares have voting
power.
Risk Factor - Penny Stock Regulation. Broker-dealer practices in
connection with transactions in "penny stocks" are regulated by certain penny
stock rules adopted by the Securities and Exchange Commission. Penny stock
generally are equity securities with a price of less than $5.00 (other than
securities registered on certain national securities exchanges or quoted on the
Nasdaq system, provided that current price and volume information with respect
to transactions in such securities is provided by the exchange or system). The
penny stock rules require a broker-dealer, prior to a transaction in a penny
stock not otherwise exempt from the rules, to deliver a standardized risk
disclosure document that provides information about penny stocks and the risks
in the penny stock market. The broker-dealer must also provide the customer with
current bid and offer quotations for the penny stock, the compensation of the
broker-dealer and its salesperson in the transaction, and monthly account
statements showing the market value of each penny stock held in the customer's
account. In addition, the penny stock rules generally require that prior to a
transaction in a penny stock the broker-dealer make a special written
<PAGE>
determination that the penny stock is a suitable investment for the purchaser
and receive the purchaser's written agreement to the transaction. These
disclosure requirements may have the effect of reducing the level of trading
activity in the secondary market for a stock that becomes subject to the penny
stock rules. If the Company's securities become subject to the penny stock
rules, investors in this offering may find it more difficult to sell their
securities.
ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Nevada Statutes, contain an extensive indemnification provision which
requires mandatory indemnification by a corporation of any officer, director and
affiliated person who was or is a party, or who is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the fact that he
is or was a member, director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a member, director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, against expenses, including attorneys' fees, and
against judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted,
or failed to act, in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful. In some instances a court must approve such indemnification.
ITEM 13. FINANCIAL STATEMENTS
Please see the attached Financial Statements.
ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS
(a) Please see the attached Financial Statements
(b) Exhibits:
3. Articles of Incorporation and bylaws
5. Opinion of counsel
<PAGE>
10.1 Gold Hill Holdings, Inc. Articles (Barbados)
10.2 Gold Hill (Guyana) Incorporated
10.3 Joint Venture Agreement
10.4 License to Trade
23.1 Consent of Stirtz Bernards Boyden Surdel & Larter, P.A.
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
TABLE OF CONTENTS
Page
Independent Auditors' Report 1
Consolidated Financial Statements:
Consolidated Balance Sheets 2
Consolidated Statements of Operations 3
Consolidated Statements of Stockholders' Equity (Deficit) 4
Consolidated Statements of Cash Flows 5
Notes to Consolidated Financial Statements 6
<PAGE>
[STIRTZ BERNARDS BOYDEN SURDEL & LARTER, P.A. LETTERHEAD]
To The Board of Directors
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
Minneapolis, Minnesota
INDEPENDENT AUDITORS' REPORT
We have audited the accompanying consolidated balance sheets of TriTec
Industries, Inc. and Subsidiaries as of December 31, 1996 and 1995, and the
related consolidated statements of operations, stockholders' equity (deficit)
and cash flows for the years then ended. These consolidated financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of TriTec Industries,
Inc. and Subsidiaries as of December 31, 1996 and 1995, and the results of their
operations and their cash flows for the years then ended in conformity with
generally accepted accounting principles.
The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
consolidated financial statements, the Company has suffered recurring losses
from operations and has a net capital deficiency, which raise substantial doubt
about its ability to continue as a going concern. Management's plans regarding
those matters also are described in Note 1. The consolidated financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
<PAGE>
We have not audited or reviewed the July 31, 1997 financial statements included
in Form 10SB, however, we did become aware of information that leads us to
conclude that they are not presented in accordance with generally accepted
accounting principles. In March 1997 the stockholders approved issuance of
preferred stock to the officers of the Company (see Note 15). This transaction
has not been reflected in the unaudited financial statements.
/s/ Stirtz Bernards Boyden Surdel & Larter
Edina, Minnesota
July 31, 1997, except for the last paragraph of the Independent
Auditors' Report as to which the date is December 12, 1997
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31,
1996 1995
-------- --------
ASSETS
Current assets:
Cash $ 242 $ 6,850
Accounts receivable - trade, less allowance for
doubtful accounts of $20,658 in 1996 and
$25,061 in 1995 -- --
Due from related parties (less allowance of $408,739
in 1996 and $47,414 in 1995) 17,500 --
Inventories 121,174 117,334
Prepaid expenses 9,711 7,164
-------- --------
Total current assets 148,627 131,348
-------- --------
Property, plant and equipment, net 148,835 132,164
-------- --------
Net of assets of Pitbull, Industries, Inc. -- 6,980
-------- --------
Goodwill, net of accumulated amortization
of $79,608 in 1996 and $63,231 in 1995 160,122 176,499
-------- --------
$457,584 $446,991
======== ========
<PAGE>
DECEMBER 31,
1996 1995
----------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Cash overdraft $ 1,980 $ --
Accounts payable 172,672 72,561
Accounts payable - other 97,310 64,995
Note payable - other 35,700 --
Long-term debt in default 311,420 292,517
Current portion of due to officer 4,001 12,620
Customer deposits 34,100 175,438
Accrued expenses:
Interest 19,656 17,206
Payroll taxes withheld and accrued 75,380 25,280
----------- ---------
Total current liabilities 752,219 660,617
----------- ---------
Long-term due to officer 54,427 68,648
----------- ---------
Stockholders' equity (deficit):
Preferred stock, series A, no par, authorized
1,000,000 shares, issued -0- shares in 1996
and 1995 -- --
Common stock, par value $.001 per share,
authorized 35,000,000 shares, issued
2,663,900 shares in 1996 and 2,044,507
shares in 1995 2,664 2,045
Additional paid-in capital 1,030,345 476,292
Retained earnings (deficit) (1,382,071) (760,611)
----------- ---------
Total stockholders' equity (deficit) (349,062) (282,274)
----------- ---------
$ 457,584 $ 446,991
=========== =========
See Notes to Consolidated Financial Statements.
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 30,
1996 1995
----------- -----------
Net sales $ 423,128 $ 128,862
Cost of sales 336,566 118,662
----------- -----------
Gross profit 86,562 10,200
Operating expense 386,992 269,945
----------- -----------
Loss from operations (300,430) (259,745)
Other income (expense):
Interest income -- 548
Equity in joint venture -- (16,850)
Bad debt - related party (211,325) (47,414)
Rental income 950 936
Interest expense (100,458) (91,253)
----------- -----------
Total other income (expense) (310,833) (154,033)
----------- -----------
Net loss before extraordinary item (611,263) (413,778)
Extraordinary item:
Gain on debt restructure -- 101,583
----------- -----------
Net loss $ (611,263) $ (312,195)
=========== ===========
Loss per common share:
Loss from operations $ (.26) $ (.21)
Extraordinary item -- .05
----------- -----------
Net loss per common share $ (.26) $ (.16)
=========== ===========
Weighted average number of common shares
outstanding 2,389,454 1,887,405
=========== ===========
See Notes to Consolidated Financial Statements.
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
<TABLE>
<CAPTION>
Common Stock
-------------------
Number Additional Retained Stockholders'
Of Paid-In Earnings Equity
Shares Amount Capital (Deficit) (Deficit)
--------- ------ ---------- ----------- ---------
<S> <C> <C> <C> <C> <C>
BALANCE, December 31, 1994 1,700,000 1,700 160,310 (448,416) (286,406)
Net loss -- -- -- (312,195) (312,195)
Stock issued for services 25,000 25 24,975 -- 25,000
Stock warrants issued for debt issue costs -- -- 52,000 -- 52,000
Stock issued for debt service 103,507 104 103,403 -- 103,507
Sale of stock (net of issue costs of $5,330) 216,000 216 135,604 -- 135,820
--------- ------ ---------- ----------- ---------
BALANCE, December 31, 1995 2,044,507 2,045 476,292 (760,611) (282,274)
Net loss -- -- -- (611,263) (611,263)
Stock issued for services 10,000 10 9,990 -- 10,000
Stock options issued for services -- -- 1,300 -- 1,300
Sale of stock (net of issue costs of $66,021) 519,393 519 452,853 -- 453,372
Stock issued for interest expense 60,000 60 59,940 -- 60,000
Stock issued for related party debt 30,000 30 29,970 -- 30,000
Spin-off of Earth Technologies, Inc. and
Pitbull Industries, Inc. -- -- -- (10,197) (10,197)
--------- ------ ---------- ----------- ---------
BALANCE, December 31, 1996 2,663,900 $2,664 $1,030,345 $(1,382,071) $(349,062)
========= ====== ========== =========== =========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
TRITEC INDUSTRIES AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Increase (Decrease) in Cash
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
1996 1995
--------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net loss $(611,263) $(312,195)
Adjustments to reconcile net loss to net
cash flows from operating activities:
Common stock issued for services 10,000 25,000
Common stock issued for interest expense 60,000 3,507
Common stock issued to related company, allowed for 30,000 --
Common stock warrants issued for debt issue costs -- 52,000
Common stock options issued for services 1,300 --
Depreciation and amortization 23,957 24,318
Equity in joint venture -- 16,850
Debt restructure -- (101,583)
Accounts receivable - trade -- (1,440)
Due from related parties (17,500) --
Inventories (3,840) (79,975)
Other current assets (2,547) (2,164)
Accounts payable 132,426 22,965
Customer deposits (141,338) 162,238
Accrued expenses 52,550 25,721
Other net assets - spin-off companies 53 --
--------- ---------
Net cash flows from operating activities (466,202) (164,758)
--------- ---------
Cash flows from investing activities:
Purchase of investments -- (4,850)
Purchase of property (24,251) --
--------- ---------
Net cash flows from investing activities (24,251) (4,850)
--------- ---------
Cash flows from financing activities:
Cash overdraft 1,980 --
Change in due to/from officers and directors (22,840) 32,707
Proceeds on issuance of common stock 453,372 35,820
Notes payable - other 35,700 100,000
Proceeds from long-term debt - bank 61,025 --
Repayment on long-term debt (40,646) (10,486)
Repayments on note payable - bank (1,476) --
Repayments on long-term debt - spin-off companies (3,270) --
--------- ---------
Net cash flows from financing activities 483,845 158,041
--------- ---------
Net change in cash (6,608) (11,567)
Cash, beginning of year 6,850 18,417
--------- ---------
Cash, end of year $ 242 $ 6,850
========= =========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
1. GOING CONCERN
The Company's financial statements for the year ended December 31, 1996
have been prepared on a going concern basis which contemplates the
realization of assets and the settlement of liabilities and commitments
in the normal course of business. The Company incurred a net loss of
$611,263 for the year ended December 31, 1996 and $312,195 for the year
ended December 31, 1995 and as of December 31, 1996 and 1995 had an
accumulated deficit of $1,382,071 and $760,611, respectively. In
addition, the Company is in default on its long-term debt and is
subject to federal and state liens for delinquent payment of payroll
taxes.
In view of these matters, realization of a major portion of the assets
in the accompanying balance sheet is dependent upon continued
operations of the Company, which in turn is dependent upon the
Company's ability to meet its financing requirements, and the success
of its future operations. The Company has been engaged in continuous
efforts to formulate a new operating plan which includes expanding
operations to include mining through possible joint venture
arrangements and raising additional capital. There can be no assurance
that management's plans will improve operations or result in raising
additional capital to the extent necessary to continue as a going
concern.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Operations
The Company was originally incorporated in Minnesota in 1994,
during 1996 it changed its corporate domicile to Nevada. The
Company was a holding company for four (4) wholly-owned
subsidiaries, which included the following:
Placer Recovery Systems, Inc. - a facilities in Walnut Grove,
Minnesota is a manufacturer of equipment, designed to process
from five (5) tons to two hundred (200) tons of ore per hour for
the placer mining industry. The Company markets and sells its
products world-wide both directly to customers and through
distributor/dealers. Terms of sale are 50% deposit with order
and the balance due at time of shipment by cash or, for domestic
sales, by prearranged credit.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Nature of Operations (Continued)
Earth Technologies, Inc. - was formed to pursue the use of
placer mining equipment for remediation of environmentally
hazardous soil that has been contaminated by heavy metals or
volatile organic chemicals.
TEC 2010, Inc - was formed to pursue the use of placer mining
equipment for remediation of environmentally hazardous soil that
has been contaminated by heavy metals or volatile organic
chemicals. As of the report date, the Company was inactive.
Pit Bull Industries, Inc. - ownership was acquired for the
design of an articulating four-wheel drive loader to be
manufactured and sold under the name "Pit Bull". The equipment
is suitable for light earth moving projects.
On November 1, 1996, the Board of Directors declared a dividend to
common stockholders in the form of 2,623,900 shares of common
stock of its wholly-owned subsidiary, Earth Technologies, Inc.
Stockholders of record of the Company on October 31, 1996 received
one share of Earth Technologies, Inc. common stock for each share
of the Company's stock held. This transaction has been accounted
for as a spin-off and, accordingly, retained earnings has been
increased by $677 in 1996, representing the carrying value of the
investment at the spin-off date.
The Company's share of equity in the undistributed earnings of
Earth Technologies, Inc. for 1996 and 1995, through the spin-off
date, was $(677) and $-0-, respectively, and is included in
interest expense.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Nature of Operations (Continued)
Following is a summary of net assets and results of operations of
Earth Technologies, Inc. as of November 1, 1996 and December 31,
1995, and for the periods then ended:
November 1, December 31,
1996 1995
--------- ------------
Cash $ 8 $ --
Inventory 140,000 --
Intangible assets 150,000 --
--------- ------------
Total assets 290,008 --
Due to related party (245,000) --
Notes payable (45,000) --
Other current liabilities (685) --
--------- ------------
Net assets $ (677) $ --
========= ============
For the
Period From
January 1, For the
1996 through Year Ended
November 1, December 31,
1996 1995
--------- ------------
Sales and other revenue $ -- $ --
Costs and expenses 677 --
--------- ------------
Net loss $ (677) $ --
========= ============
On November 1, 1996, the Board of Directors declared a dividend to
common stockholders in the form of 2,623,900 shares of common
stock of its wholly-owned subsidiary, Pitbull Industries, Inc.
Stockholders of record of the Company on October 31, 1996 received
one share of Pitbull Industries, Inc. common stock for each share
of the Company's stock held. This transaction has been accounted
for as a spin-off and, accordingly, retained earnings has been
decreased by $10,874 in 1996, representing the carrying value of
the investment at the spin-off date.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Nature of Operations (Continued)
The Company's share of equity in the undistributed earnings of
Pitbull Industries, Inc. for 1996 and 1995, through the spin-off
date, was $(2,286) and $-0-, respectively, and is included in
interest expense.
Following is a summary of net assets and results of operations of
Pitbull Industries, Inc. as of November 1, 1996 and December 31,
1995, and for the periods then ended:
November 1, December 31,
1996 1995
---------------- ----------------
Cash $ 4 $ -
Due from related party 100
Inventory 42,500 42,500
---------------- ---------------
Total assets 42,604 42,500
---------------- ---------------
Notes payable (31,730) (35,000)
Other current liabilities - (520)
---------------- ---------------
Net assets $ 10,874 $ 6,980
================ ===============
For the
Period From
January 1, For the
1996 through Year Ended
November 1, December 31,
1996 1995
------------------ ---------------
Sales and other revenue $ - $ -
Costs and expenses 2,286 520
---------------- ---------------
Net loss $ (2,286) $ (520)
================ ===============
Net assets of Pitbull Industries, Inc. have been separately
classified in the accompanying balance sheet at December 31, 1995.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Principles of Consolidation
The accompanying consolidated financial statements include the
accounts of the Company and all of its wholly owned subsidiaries.
Intercompany transactions and balances have been eliminated in
consolidation.
Investments
Investments in companies/joint ventures in which the Company has a
20% to 50% interest are reported on the equity method of
accounting.
Goodwill
Goodwill represents the excess of the cost of companies acquired
over the fair value of their net assets at the date of acquisition
and is being amortized on the straight-line method over 15 years.
Amortization expense charged to operations for 1996 and 1995 was
$16,377 and $16,437, respectively.
Inventories
Inventories are stated at the lower of cost, determined by the
FIFO method, or market. (See Note 4.)
Property, Plant and Equipment
The cost of property, plant and equipment is depreciated over the
estimated useful lives of the related assets. Depreciation is
computed on the general depreciation system straight-line method
for financial reporting purposes and for income tax purposes. (See
Note 5.)
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Income Taxes
Income taxes are provided for the tax effects of transactions
reported in the consolidated financial statements and consist of
income taxes currently due plus deferred income taxes. Deferred
income taxes relate to differences between the financial and tax
basis of certain assets and liabilities. Temporary differences
that result in deferred income taxes were net operating loss
carryforwards and the allowance for doubtful accounts.
Accounting Estimates
The process of preparing consolidated financial statements in
conformity with generally accepted accounting principles requires
the use of estimates and assumptions regarding certain types of
assets, liabilities, revenues and expenses. Such estimates
primarily relate to unsettled transactions and events as of the
date of the consolidated financial statements. Accordingly, upon
settlement, actual results may differ from estimated amounts.
Advertising Costs
Advertising costs are charged to expense as incurred. The total
advertising costs were $6,646 for 1996 and $12,493 for 1995.
Net Loss Per Common Share
Net loss per common share is computed by dividing the net loss by
the weighted average number of common shares outstanding. Fully
diluted and primary earnings per common share are the same amounts
for each of the periods presented. In loss periods, dilutive
common equivalent shares are excluded as the effect would be
anti-dilutive.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Stock Based Compensation
In October, 1995, the Financial Accounting Standards Board issued
Statements of Financial Accounting Standards No. 123, Accounting
for Stock-Based Compensation. The Company currently accounts for
its stock-based compensation plans using the accounting prescribed
by Accounting Principles Board Option No. 25, Accounting for Stock
Issued Employees (see Note 3). Since the Company is not required
to adopt the fair value based recognition provisions prescribed
under SFAS No. 123, it has elected only to comply with the
disclosure requirements set forth in the Statements, which
includes disclosing pro forma net income, as if the fair value
based method of accounting had been applied.
Fair Value of Financial Instruments
The carrying amounts for cash, receivables and payables
approximate fair value because of the short maturity, generally
less than three months, of these instruments. As described in Note
9, the Company is in default on its long-term debt. Long-term debt
is carried on the balance sheet at cost.
3. DUE FROM RELATED PARTIES
Due from related parties consisted of the following:
1996 1995
-------------- ------------
Due from officers (net allowance of
$147,469 and $43,644 for December 31,
1996 and 1995, respectively) $ - $ -
Due from related parties (net allowance
of $33,770 and $3,770 for December 31,
1996 and 1995, respectively) - -
Due from related company (net allowance
of $227,500 for December 31, 1996) 17,500 -
------------ ------------
$ 17,500 $ -
============ ============
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
3. DUE FROM RELATED PARTIES (CONTINUED)
Due from officers represent non-interest-bearing advances not evidenced
by written instruments, taken in excess of salaries and other
consulting fees. The officer's primary source for repayment is based on
the future earnings of the Company. The Company is in a going concern
situation with limited operations and a deficiency of assets, therefore
the officers ability to repay is limited. Accordingly, the due from
officers of $147,469 and $43,644 as of December 31, 1996 and 1995,
respectively, has been fully allowed for.
Due from related parties represents amounts due from Black Chess, Ltd.,
a entity owned by two officers of the Company. As stated in the
previous paragraph, the officers ability to repay (and therefore, this
entity's ability to repay) is limited. Accordingly, the due from
related parties in the amount of $33,770 and $3,770 as of December 31,
1996 and 1995, respectively, has been fully allowed for.
Due from related company represents amounts due from Earth
Technologies, Inc., a former wholly-owned subsidiary (see Note 1), for
the production and sale of certain machinery and intellectual rights
associated with the production of the equipment. Earth Technologies,
Inc., has not recorded any sales activity and has few liquid assets,
therefore, its ability to pay is limited. Accordingly, an allowance of
$227,500 has been set-up to record the due from related company at net
realizable value; $77,500 was reserved for a sale of tangible property
and $150,000 was reserved as a reduction to the gain on the intangible
sale which had a historical cost of zero.
4. INVENTORIES
Inventories consisted of the following:
1996 1995
------------------ --------------
Finished goods $ 44,563 $ 49,306
Work in process 57,244 49,474
Raw material 19,367 18,554
---------------- --------------
Total $ 121,174 $ 117,334
================ ==============
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
5. INVESTMENTS
Investments recorded using the equity method consist of the following
at December 31:
1996 1995
------------------ -------------
Ameralt Company $ - $ -
Ameralt is a joint venture between Placer Recovery Systems, Inc. (40%)
and "DACO" Company of Ulaanbaatar, Mongolia (60%) for the manufacturer
of gold recovery machines and other such equipment as mutually agreed
upon and other activities not forbidden by Mongolian law. The Company
has contributed equipment valued at $16,850 through December 31, 1995.
As of December 31, 1996 and 1995, no financial statements have been
prepared for the joint venture, however, it is management's estimate
that the Company's equity share in the earnings (loss) of Ameralt is
$-0- and $(16,850) for 1996 and 1995, respectively.
6. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consisted of the following:
1996 1995
------------------ ---------------
Land $ 5,950 $ 5,950
Buildings 118,064 118,063
Furniture and fixtures 21,668 11,692
Machinery and equipment 37,614 23,340
---------------- ---------------
183,296 159,045
Less: accumulated depreciation (34,461) (26,881)
---------------- ---------------
Total $ 148,835 $ 132,164
================ ===============
Depreciation expense charged to operations was $7,580 and $7,118 in
1996 and 1995 respectively.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
6. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
The useful lives of property, plant and equipment for purposes of
computing depreciation are:
Buildings 31.5 and 40 years
Furniture and fixtures 5 to 10 years
Machinery and equipment 10 years
7. NOTE PAYABLE - OTHER
Note payable consists of three unsecured, informal promises to repay
principal to various individuals. The notes are non-interest bearing,
but contain agreements relating to stock issuance and options. The
total amount outstanding at December 31, 1996 was $35,700.
8. DUE TO OFFICER
At December 31, 1995, due to officer consisted of an unsecured note
payable in monthly installments of $1,808, including interest at 12%..
Future maturities of long-term debt are as follows:
1997 $ 4,001
1998 16,024
1999 18,056
2000 20,347
---------------
$ 58,428
===============
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
9. LONG-TERM DEBT IN DEFAULT
Following is a summary of long-term debt at December 31:
1996 1995
-------- --------
Demand note payable to bank at 10%, due May,
1997, interest due in monthly installments until
May, 1997, secured by inventory, accounts
receivable and equipment $ 50,000 $ --
Note payable to bank at 10.5%, due February,
2000, principal and interest due in monthly
installments of $282.25 per month until
February, 2000, secured by forklift 9,549 --
Demand note payable to Northern Michigan
BIDCO at 11% interest; in default, $80,000 to
be repaid in 36 monthly payments of $2,619
beginning January 15, 1996, including interest
from January 1, 1996. Guaranteed by two
stockholders/officers 62,227 80,000
Note payable to Southwest Minnesota Initiative
Fund at 6% interest, secured by a mortgage on
the property in Walnut Grove and all
inventory, equipment, and accounts 86,436 96,436
Note payable to an individual in monthly
payments of $2,275 including interest at 8%,
secured by the property, plant, equipment and
inventory in Walnut Grove 48,768 65,674
Non-interest bearing note payable to an
individual - net of imputed interest at 8%
Matures September, 1998 54,440 50,407
-------- --------
Total $311,420 $292,517
======== ========
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
9. LONG-TERM DEBT IN DEFAULT (CONTINUED)
During 1995, the Company renegotiated debt to an individual resulting
in a non-interest bearing note payable. At that time, the Company
imputed interest at 8% and recognized a discount on the note of $12,939
which is included as an extraordinary item on the consolidated
statement of operations for 1995 (see Note 17).
During 1995, a demand note payable - bank for $88,644 including
interest of $6,004 was forgiven and is included as an extraordinary
item on the consolidated statement of operations (see Note 17).
As of report date, the Company was in default on all of the above notes
resulting in the entire balance of long-term debt to be classified as
current. Also, as of the report date, the Southwest Minnesota
Initiative Fund foreclosed on the Walnut Grove property (see Note 15).
10. LEASES
The Company leases office space at a monthly gross rental of $4,080
through May 31, 2000, with a five-year renewal option and additional
rent based upon variations in operating costs. Rent expense for 1996
and 1995 was $54,940 and $20,148, respectively.
Future minimum rent payments are as follows:
1997 $ 48,960
1998 48,960
1999 48,960
2000 20,400
---------------
$ 167,280
===============
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
11. INCOME TAXES
At December 31, 1996, the Company has an operating loss carryforward
for tax purposes of approximately $900,000 which expires through 2011.
In addition for tax purposes, the Company has a temporary difference
for the allowance for doubtful accounts of $430,000 at December 31,
1996. The Company has fully reserved the tax benefit of the operating
loss carryforward and the temporary difference related to the allowance
for doubtful accounts, amounting to approximately $530,000, because the
likelihood of realization of the benefit cannot be established.
The Internal Revenue Code contains provisions which may limit the loss
carryforwards available if significant changes in stockholder ownership
of the Company occur.
12. MAJOR CUSTOMERS
Due to the limited number of individual customers comprising sales for
1996 and 1995, substantially all customers exceeded 10% of total sales.
13. SUPPLEMENTAL CASH FLOW INFORMATION
1996 1995
-------------- -------------
Cash paid during the year for:
Interest $ 38,008 $ 17,623
============= =============
Income Taxes $ - $ -
============= =============
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
13. SUPPLEMENTAL CASH FLOW INFORMATION (CONTINUED)
Summary of non-cash transactions is as follows:
During 1995, the Company incurred a $35,000 note payable to an
individual for the purchase of inventory. This note was spun-off
with Pitbull Industries, Inc. (see Note 1).
During 1995, the Company issued 25,000 shares of common stock to
individuals for consulting services valued at $1 per share for a
total of $25,000.
During 1995, $20,680 accrued interest due to an officer was
converted and combined with other amounts due to this officer into
one note payable.
During 1995, the Company issued 200,000 warrants for the purchase
of common stock to an individual for debt issue costs. The
warrants were valued at $.26 per warrant as determined using the
Black-Scholes Model, for a total of $52,000.
During 1995, the Company issued 103,507 shares of common stock to
an individual for debt service of a $100,000 note payable plus
accrued interest of $3,507. The stock was valued at $1 per share
for a total of $103,507.
During 1996, the Company issued 60,000 shares of common stock to
an individual as additional interest for default on loan valued at
$1 per share for a total of $60,000.
During 1996, the Company issued 30,000 shares of common stock to
an individual in lieu of payment for the debt of Black Chess,
Ltd., an entity owned by two officers of the Company. The stock
was valued at $1 per share for a total of $30,000.
During 1996, the Company issued 10,000 shares of common stock to
individuals for consulting services valued at $1 per share for a
total of $10,000.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
14. CAPITALIZATION
Preferred Stock, Series A
The preferred stock, series A, is noncumulative, participating and
is convertible into 10 shares of common stock at the option of the
holder.
Common Stock Exchanged for Services
During the period from inception to December 31, 1996, the Company
issued common stock in exchange for various consulting services.
The value of these services have been based upon the fair value of
the common stock issued as determined by sales of the Company's
common stock during the respective time periods. The cost of the
services have been charged to operations, and additional paid-in
capital has increased by the excess of the costs of services over
the par value of common stock issued.
Date Number of Shares Nature of Services
------------- ---------------- ------------------
October, 1995 25,000 Consulting
March, 1996 10,000 Consulting
Incentive Stock Option
During 1996, the Company approved an incentive stock option plan
which authorizes the granting of stock options to its employees,
directors, and certain key service providers for up to 250,000
shares of common stock. Under the incentive plan, the exercise
price of each option shall not be less than fair market value of
share on the date of grant, and an option's maximum term is ten
years.
The Company has also issued various non-qualifying stock options
since its inception and the terms are at the discretion of the
Board of Directors.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
14. CAPITALIZATION (CONTINUED)
Incentive Stock Option (Continued)
The fair value of each option granted is estimated on the grant
date using the Black-Scholes Model. The following assumptions were
made in estimating fair value:
Assumption Incentive Plan Non-qualifying Plan
---------- -------------- -------------------
Dividend yield 0% 0%
Risk-free interest rate 6% 6%
Expected life 5 years 5 years
Following is a summary of the status of the incentive and
non-qualified stock options from inception to December 31, 1996:
Incentive Stock Options Non-Qualified Options
----------------------- ---------------------
Weighted Weighted
Average Average
Number of Exercise Number of Exercise
Shares Price Shares Price
---------- --------- --------- ---------
Outstanding at
12/31/95 -- $ -- -- $ --
Granted 76,500 1.93 250,000 2.00
Exercised -- -- -- --
---------- --------- --------- ---------
Outstanding at
12/31/96 76,500 $ 1.93 250,000 $ 2.00
========== ========= ========= =========
Options exercisable
at 12/31/96 -- $ -- 250,000 $ 2.00
========== ========= ========= =========
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
14. CAPITALIZATION (CONTINUED)
Incentive Stock Option (Continued)
Number of Weighted Average Weighted Average
Shares Exercise Price Fair Value
Exercise price of options
granted during period
ended 12/31/96:
Greater than market 321,500 $ 2.00 $ -
========= ============= ==========
Equal to market 5,000 $ 1.00 $ 0.26
========= ============= ==========
The 5,000 options with an exercise price of $1.00 were issued to a key
service provider, not an employee. Accordingly, the fair value of the
options of $1,300 has been charged to operations during 1996.
The following table summarizes information about incentive and
non-qualified stock options outstanding at December 31, 1996:
<TABLE>
<CAPTION>
Outstanding Options Exercisable Options
--------------------------------------- ------------------------
Weighted
Average Weighted Weighted
Range of Number of Remaining Average Number Average
Exercise Outstanding Contractual Exercise Exercisable Exercise
Prices at 12/31/97 Life Price at 12/31/97 Price
- -------------- ----------- ---------- -------- ----------- --------
<S> <C> <C> <C> <C> <C>
$1.00 5,000 5.0 years $ 1.00 - $ 1.00
$2.00 321,500 4.5 years 2.00 250,000 2.00
------------ ----------
$1.00 to 2.00 326,500 250,000
============ ==========
</TABLE>
Warrants
The Company has issued various warrants related to bridge loans,
placement services and issuance of common stock.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
14. CAPITALIZATION (CONTINUED)
Warrants (Continued)
The following table summarizes activity for warrants at December 31,
1996:
Number Exercise
Outstanding Price
----------- --------
December 31, 1994 -
Bridge loans 200,000 $1.00
Placement services 4,100 $1.30
--------------
December 31, 1995 204,100
Placement services 46,939 $1.30
--------------
December 31, 1996 251,039
==============
15. SUBSEQUENT EVENTS
Authorized Shares of Stock
In March, 1997, the stockholders also approved the authorization
of 1,000,000 shares of convertible preferred stock, series B. The
preferred stock, series B is convertible into 10 shares of common
stock at a price of $1 per share and has voting rights of 10 votes
per share. The stockholders approved the issuance, for past
services, of 250,000 shares of preferred stock, series B to the
officers of the Company. The value of the compensation is to be
determined, by independent valuation, at the fair value of the
services performed or the stock received. As of the report date,
no independent valuation has been completed.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
15. SUBSEQUENT EVENTS (CONTINUED)
Notes Payable
In 1997, the Company entered into various note payable agreements
with individuals totaling $67,500. The notes are payable April,
1997 to March, 2000, plus interest at 10% to 107%. Certain notes
are convertible, at the note holders option, into 56,500 shares of
common stock of the Company at conversion rates of $1 per share to
$1.50 per share. In addition, certain notes contain warrants to
purchase an additional 50,100 shares of common stock of the
Company at a price $1 per share to $2.25 per share.
Foreclosure
In April, 1997, the SW Minnesota Initiative Fund completed a
mortgage foreclosure action by sheriff's sale on the Company's
Walnut Grove, Minnesota property. The Company has been granted a
redemption right until October, 1997 to redeem the property for
$85,000, plus accrued interest (see Note 9). As of December 31,
1996, the property, net of accumulated depreciation, was $111,310.
Letter of Intent
The Company entered into a letter of intent agreement with a
corporation for the sale of 1,000,000 shares of common stock of
the Company for $.01 share or $10,000. In addition, the letter of
intent granted the corporation, for one year, the option to
purchase an additional 1,000,000 shares at the price of $1 per
share. The shares available through the option have warrants to
acquire an additional 1,000,000 shares at a price of $1.25 per
share for a period of two years. The agreement requires that a
formal agreement incorporating the above be finalized in 1997. If
this formal agreement is not completed, the initial $10,000 shall
be returned to purchaser and the 1,000,000 shares of common stock
returned to the Company. As of the report date the initial deposit
of $10,000 has been received, however, the formal agreement has
not been completed and the related shares have not been issued.
(Continued)
<PAGE>
TRITEC INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996 AND 1995
15. SUBSEQUENT EVENTS (CONTINUED)
Joint Venture
The Company entered into a joint venture agreement to purchase
mining interests in the Upper Mazarumi River Region of Western
Guyana. The agreement calls for initial capital from the Company
of $950,000. The Company's ownership percentage will be 47.5%. As
of the report date, the Company has not invested its share of
capital and the joint venture has not begun operations.
Common Stock Transactions
Subsequent to December 31, 1996 through July 31, 1997, the report
date, the Company sold and issued an additional 23,130 shares of
common stock for $1 per share, incurring $407 of issuing costs.
16. COMMITMENTS AND CONTINGENCIES
As of December 31, 1996, the Company has guaranteed a $31,730 loan
between an individual and Pitbull Industries, Inc., a former
wholly-owned subsidiary of the Company (see Note 2).
Also, as of December 31, 1996, the Company has guaranteed a $45,040
note payable between a bank and Earth Technologies, Inc., a former
wholly-owned subsidiary of the Company (see Note 2).
17. EXTRAORDINARY ITEM
1995 Extraordinary gain is as follows:
Demand note payable to bank plus interest
forgiven (see Note 9) $ 88,644
Renegotiated debt to an individual (see Note 9) 12,939
---------------
Total $ 101,583
===============
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant caused this registration statement to be signed on its behalf by
the undersigned thereunto duly authorized.
Date: January 26, 1998 TriTec Industries, Inc.
/s/ Eugene Chessen
----------------------------------
Eugene Chessen, Chairman
/s/ Willis Black
----------------------------------
Willis Black, President
/s/ John McManus
----------------------------------
John McManus, Vice President
/s/ James O'Neill
----------------------------------
James O'Neill, Director
/s/ Michael Burns
----------------------------------
Michael Burns, Director
Exhibit 3
SECRETARY OF STATE
[SEAL] THE GREAT SEAL OF THE STATE OF NEVADA
STATE OF NEVADA
CORPORATE CHARTER
I, DEAN HELLER, the duly elected and qualified Nevada Secretary of State, do
hereby certify that TRITEC INDUSTRIES, INC. did on June 24, 1996 file in this
office the original Articles of Incorporation; that said Articles are now on
file and of record in the office of the Secretary of State of the State of
Nevada, and further, that said Articles contain all the provisions required by
the law of said State of Nevada.
IN WITNESS WHEREOF, I have hereunto set my
hand and affixed the Great Seal of State, at
my office, in Carson City, Nevada, on June
24, 1996.
[SEAL] /s/ Dean Heller
Secretary of State
By /s/ illegible
Certification Clerk
<PAGE>
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE FILING FEE:
STATE OF NEVADA RECEIPT #:
JUNE 24 1996
ARTICLES OF INCORPORATION
(PURSUANT TO NRS 78)
STATE OF NEVADA
[SEAL]
DEAN HELLER SECRETARY OF STATE
/s/ Dean Heller
No. 13803-96
STATE OF NEVADA
(For filing office use) SECRETARY OF STATE (For filing office use)
IMPORTANT: Read instructions on reverse side before completing this form.
TYPE OR PRINT (BLACK INK ONLY)
1. NAME OF CORPORATION: TriTec Industries, Inc.
2. RESIDENT AGENT: (designated resident agent and his STREET ADDRESS in Nevada
where process may be served)
Name of Resident Agent: Jan Cabot
Street Address: 1517 Goldfield Ave. Carson City 87701
Street No. Street Name City Zip
3. SHARES: (number of shares the corporation is authorized to issue)
Number of shares with par value: See Attached Par value: _______________
Number of shares without par value: _______________
4. GOVERNING BOARD: shall be styled as (check one): _X_ Directors ___ Trustees
The FIRST BOARD OF DIRECTORS shall consist of 2 members and the names and
addresses are as follows:
Willis Black 7901 Flying Cloud Dr. #200, Eden Prairie, MN 55344
Name Address City/State/Zip
Eugene Chessen " "
Name Address City/State/Zip
Name Address City/State/Zip
5. PURPOSE (optional - see reverse side): The purpose of the corporation shall
be:
6. NRS 78.037: States that the articles of incorporation may also contain a
provision eliminating or limiting the personal liability of a director or
office of the corporation or its stockholders for damages for breach of
fiduciary duty as a director or officer except acts or omissions which
include misconduct or fraud. Do you want this provision to be part of your
articles? Please check one of the following: YES X NO ____.
7. OTHER MATTERS: This form includes the minimal statutory requirements to
incorporate under NRS 78. You may attach additional information noted on
separate pages. But, if any of the additional information is contradictory
to this form it cannot be filed and will be returned to you for correction.
Number of pages attached 3.
8. SIGNATURES OF INCORPORATORS: The names and addresses of each of the
incorporators signing the articles: (signatures must be notarized)
Willis Black
Name (print) Name (print)
7901 Flying Cloud Dr. #200, Eden Prairie, MN 55344
Address City/State/Zip Address City/State/Zip
/s/ Willis Black
Signature Signature
Eugene Chessen
Name (print) Subscribed and sworn to
before me this 6 day of
7901 Flying Cloud Dr. #200, Eden Prairie, MN 55344 June, 1996
Address City/State/Zip
/s/ Eugene Chessen /s/ Ted A. Allen
Signature Notary Public
affix notary stamp or seal
[STAMP] Ted A. Allen
NOTARY PUBLIC-MINNESOTA
MY COMMISSION EXPIRES 1-31-2000
9. CERTIFICATE OF ACCEPTANCE OF APPOINTMENT OF RESIDENT AGENT
I, Jan Cabot hereby accept appointment as Resident Agent for the above named
corporation.
6/17/96
Dated
<PAGE>
SHARES OF STOCK
The total authorized shares of all classes that this corporation may issue is
36,000,000 shares, of which 1,000,000 shall be Series A Preferred Shares
(hereinafter "preferred shares").
All shares shall have a par value of $0.001 (1/10 of one cent).
COMMON SHARES
Subject to the right of the Board of Directors to designate an additional class
or series of shares, 35,000,000 shall be Common Shares (hereinafter "common
shares").
PREFERRED SHARES
The designations and the powers, preferences and rights and the qualifications,
limitations or restrictions of the preferred shares are as follows:
a) Dividends. The holders of the preferred shares shall not be entitled to
receive dividends.
b) Voting Rights. Each preferred share shall have, for all purposes, ten votes.
1.) increase the authorized amount of the Series A Preferred Shares; or
authorize or create, or increase the authorized amount of, any additional
class of stock ranking prior to or on a parity with the Series A Preferred
Shares; or
2.) amend, alter or repeal any of the provisions of the Articles of
Incorporation or any of the rights, preferences or powers of the outstanding
Series A Preferred Shares fixed herein; or
3.) merge or consolidate with or into any other corporation or corporations.
c) Conversion. The holders of the preferred shares shall have the right, at
their option, to convert such shares into common shares upon the following
terms and conditions:
1.) Upon payment of the sum of $0.10 (ten cents) per common share to be
issued, each share of the preferred shares shall be convertible at any time
into ten (10) fully paid and non-assessable common shares of this
corporation as constituted at the time of such conversion. Every reference
in this paragraph c) to the common shares of the corporation (unless a
different intention is expressed) shall be to the $0.001 par value common
shares of this corporation as defined in this Article III.
<PAGE>
2.) If at any time, or from time to time, the corporation shall (A) declare
and pay, on or in respect of, common shares any dividend payable in common
shares, or (B) subdivide the outstanding common shares into a greater number
of shares, or contract the number of outstanding preferred shares by
combining such shares into a smaller number of shares, the conversion ratio
in effect at the time of the taking of a record for such dividend or the
taking of such other action shall be proportionately increased as of such
time, and conversely (C) if at any time, or from time to time, the
corporation shall contract the number of common shares by combining such
shares into a smaller number of shares, or subdivide the outstanding
preferred shares into a greater number of shares of preferred shares, the
conversion ratio in effect at the time of the taking of any such action
shall be proportionately decreased as of such time.
3) If the corporation shall consolidate with or merge into any corporation
or reclassify its outstanding common shares (other than by way of
subdivision or contraction of such shares), each preferred share shall
thereafter be convertible into the number of shares of stock or other
securities or property of the corporation, or of the entity resulting from
such consolidation or merger, to which a holder of the number of common
shares deliverable upon conversion of such preferred share would have been
entitled upon such consolidation or merger or reclassification, had the
holder of such preferred share exercised the holder's right of conversion
and had such shares been issued and outstanding and had such holder been the
record holder of such common shares at the time of the consolidation, merger
or reclassification. The corporation shall make lawful provision therefor as
a part of such consolidation, merger or reclassification.
4) The corporation shall, so long as any of the preferred shares are
outstanding, reserve and keep available out of its authorized and unissued
common shares such number of common shares as shall from time to time be
sufficient to effect the conversion of all preferred shares then
outstanding.
d) Liquidation. In the event of a liquidation, dissolution or winding-up of the
corporation, each preferred share shall be converted into ten (10) common
shares of the corporation as of the date immediately preceding such
liquidation, dissolution or winding-up of the corporation, unless the holder
of such preferred shares gives written notice to the corporation, within
thirty (30) days following the earlier of the date upon which such holder is
given written notice of such liquidation, dissolution or winding-up of the
corporation or the date of such liquidation, dissolution or winding-up of
the corporation, to the corporation that the holder does not wish such
conversion to occur. Upon such conversion, the common shares into which each
preferred share is converted shall be subject to a lien in the amount of the
conversion price prescribed in paragraph c) and the amount of such lien
shall be recovered by the corporation out of any liquidation payments with
respect to such common stock. Any preferred shares which are not converted
to common stock shall receive no liquidation payments whatsoever.
e) Redemption. The Corporation shall have no right to redeem the Series A
Preferred Shares.
<PAGE>
DIRECTORS MAY DESIGNATE
The Board of Directors of this Corporation may prescribe one or more classes or
series of stock not designated herein. Such additional classes or series of
stock may be created by a reduction in the number of authorized but unissued
common shares. The Board of Directors shall designate such additional classes or
series, by a resolution which prescribes the voting powers, designations,
preferences, limitations, restrictions and relative rights of each class or
series of stock and shall otherwise conform to law. Except as otherwise provided
in the description of a series of stock, all shares of a series must have voting
powers, designations, preferences, limitations, restrictions and relative rights
identical with those of other shares of the same series.
CUMULATIVE VOTING
Shareholders shall be entitled to cumulative voting for directors of this
Corporation. Cumulative voting shall be accomplished in the manner provided by
statute.
<PAGE>
BYLAWS
OF
TRITEC INDUSTRIES, INC.
ARTICLE ONE
OFFICES
1.1 Offices. The principal executive office of the corporation shall be
7901 Flying Cloud Drive, Suite 245, Eden Prairie, Minnesota 55344, and the
corporation may have offices at such other places within or without the State of
Minnesota as the Board of Directors shall from time to time determine or the
business of the corporation requires.
ARTICLE TWO
MEETINGS OF SHAREHOLDERS
2.1 Regular Meetings. Regular meetings of the shareholders of the
corporation entitled to vote shall be held on an annual or other less frequent
basis as shall be determined by the Board of Directors or by the chief executive
officer; provided, that if a regular meeting has not been held during the
immediately preceding 15 months, a shareholder or shareholders holding 3% or
more of the voting power of all shares entitled to vote may demand a regular
meeting of shareholders by written notice of demand given to an officer of the
corporation. At each regular meeting, the shareholders, voting as provided in
the Articles of Incorporation and these Bylaws, shall elect qualified successors
for directors who serve for an indefinite term or whose terms have expired or
are due to expire within six months after the date of the meeting, and shall
transact such other business as shall come before the meeting. No meeting shall
be considered a regular meeting unless specifically designated as such in the
notice of meeting or unless all shareholders entitled to vote are present in
person or by proxy and none of them objects to such designation.
2.2 Special Meetings. Special meetings of the shareholders entitled to
vote may be called at any time by the Chairman of the Board, the chief executive
officer, the chief financial officer, two or more directors, or a shareholder or
shareholders holding ten percent (10%) or more of the voting power of all shares
entitled to vote.
<PAGE>
2.3 Place of Meetings. Meetings of the shareholders shall be held at
the principal executive office of the corporation or at such other place, within
or without the State of Minnesota, as is designated by the Board of Directors,
except that a regular meeting called by or at the demand of a shareholder shall
be held in the county where the principal executive office of the corporation is
located.
2.4 Notice of Meetings. There shall be mailed to each holder of shares
entitled to vote, at his address as shown by the books of the corporation, a
notice setting out the place, date and hour of any regular or special meeting,
which notice shall be mailed not less than ten (10) days nor more than sixty
(60) days prior to the date of the meeting; provided, that notice of a meeting
at which there is to be considered a proposal (i) to dispose of all, or
substantially all, of the property and assets of the corporation or (ii) to
dissolve the corporation shall be mailed to all shareholders of record, whether
or not entitled to vote; and provided further, that notice of a meeting at which
there is to be considered a proposal to adopt a plan of merger or exchange shall
be mailed to all shareholders of record, whether or not entitled to vote, at
least fourteen (14) days prior thereto. Notice of any special meeting shall
state the purpose or purposes of the proposed meeting, and the business
transacted at all special meetings shall be confined to the purposes stated in
the notice, unless all of the shareholders are present in person or by proxy and
none of them objects to consideration of a particular item of business.
Attendance at a meeting by any shareholder, without objection by him, shall
constitute his waiver of notice of the meeting.
2.5 Quorum and Adjourned Meeting. The holders of a majority of the
voting power of the shares entitled to vote at a meeting, represented either in
person or by proxy, shall constitute a quorum for the transaction of business at
any regular or special meeting of shareholders. If a quorum is present when a
duly called or held meeting is convened, the shareholders present may continue
to transact business until adjournment, even though the withdrawal of a number
of shareholders originally present leaves less than the proportion or number
otherwise required for a quorum. In case a quorum is not present at any meeting,
those present shall have the power to adjourn the meeting from time to time,
without notice other than announcement at the meeting, until the requisite
number of shares entitled to vote shall be represented. At such adjourned
<PAGE>
meeting at which the required amount of shares entitled to vote shall be
represented, any business may be transacted which might have been transacted at
the original meeting.
2.6 Voting. At each meeting of the shareholders, every shareholder
having the right to vote shall be entitled to vote in person or by proxy duly
appointed by an instrument in writing subscribed by such shareholder. Each
shareholder shall have one (1) vote for each share having voting power standing
in his name on the books of the corporation except as may be otherwise required
to provide for cumulative voting (if not denied by the Articles). Upon the
demand of any shareholder, the vote for directors or the vote upon any question
before the meeting shall be by ballot. All elections shall be determined and all
questions decided by a majority vote of the number of shares entitled to vote
and represented at any meeting at which there is a quorum except in such cases
as shall otherwise be required by statute, the Articles of Incorporation or
these Bylaws. Except as may otherwise be required to conform to cumulative
voting procedures, directors shall be elected by a plurality of the votes cast
by holders of shares entitled to vote thereon.
2.7 Record Date. The Board of Directors may fix a time, not exceeding
sixty (60) days preceding the date of any meeting of shareholders, as a record
date for the determination of the shareholders entitled to notice of and
entitled to vote at such meeting, notwithstanding any transfer of any shares on
the books of the corporation after any record date so fixed. In the absence of
action by the Board, only shareholders of record twenty (20) days prior to a
meeting may vote at such meeting.
2.8 Order of Business. The suggested order of business at any regular
meeting, and, to the extent appropriate, at all other meetings of the
shareholders shall, unless modified by the presiding chairman, be:
(a) Call of roll
(b) Proof of due notice of meeting or waiver of notice
(c) Determination of existence of quorum
(d) Reading and disposal of any unapproved minutes
(e) Reports of officers and committees
(f) Election of directors
(g) Unfinished business
(h) New business
(i) Adjournment.
<PAGE>
ARTICLE THREE
DIRECTORS
3.1 General Powers. Except as authorized by the shareholders pursuant
to a shareholder control agreement or unanimous affirmative vote, the business
and affairs of the corporation shall be managed by or under the direction of a
Board of Directors.
3.2 Number, Term and Qualifications. The Board of Directors shall
consist of one or more members. The number of members of the first Board (if not
named in the Articles of Incorporation) shall be determined by the incorporators
or shareholders. Thereafter, at each regular meeting of shareholders, the
shareholders shall determine the number of directors; provided, that between
regular meetings of shareholders the authorized number of directors may be
increased or decreased by the shareholders or increased by the Board of
Directors. Each director shall serve for an indefinite term that expires at the
next regular meeting of shareholders, and until his successor is elected and
qualified, or until his earlier death, resignation, disqualification, or removal
as provided by statute.
3.3 Vacancies. Vacancies on the Board of Directors may be filled by the
affirmative vote of a majority of the remaining members of the Board, though
less than a quorum; provided, that newly created directorships resulting from an
increase in the authorized number of directors shall be filled by the
affirmative vote of a majority of the directors serving at the time of such
increase. Persons so elected shall be directors until their successors are
elected by the shareholders, who may make such election at the next regular or
special meeting of the shareholders.
3.4 Quorum and Voting. A majority of the directors currently holding
office shall constitute a quorum for the transaction of business. Except as
otherwise provided in the Articles of Incorporation or these Bylaws, the acts of
a majority of the directors present at a meeting at which a quorum is present
shall be the acts of the Board of Directors.
3.5 Board Meetings: Place and Notice. Meetings of the Board of
Directors may be held from time to time at any place within or without the State
of Minnesota that the Board of Directors may designate. In the absence of
designation by the Board of Directors, Board meetings shall be held at the
principal
<PAGE>
executive office of the corporation. Any director may call a Board meeting by
giving forty-eight (48) hours notice to all directors of the date and time of
the meeting. The notice need not state the purpose of the meeting, and may be
given by mail, telephone, telegram, or in person. If a meeting schedule is
adopted by the Board, or if the date and time of a Board meeting has been
announced at a previous meeting, no notice is required.
3.6 Absent Directors. A director may give advance written consent or
opposition to a proposal to be acted on at a Board meeting. If the director is
not present at the meeting, consent or opposition to a proposal does not
constitute presence for purposes of determining the existence of a quorum, but
consent or opposition shall be counted as a vote in favor of or against the
proposal and shall be entered in the minutes of the meeting, if the proposal
acted on at the meeting is substantially the same or has substantially the same
effect as the proposal to which the director has consented or objected.
3.7 Compensation. Directors who are not salaried officers of the
corporation shall receive such fixed sum per meeting attended or such fixed
annual sum or both as shall be determined from time to time by resolution of the
Board of Directors. Nothing herein contained shall be construed to preclude any
director from serving this corporation in any other capacity and receiving
proper compensation therefor.
3.8 Committees. The Board of Directors may, by resolution approved by
the affirmative vote of a majority of the Board, establish committees having the
authority of the Board in the management of the business of the corporation only
to the extent provided in the resolution. Each such committee shall consist of
one or more natural persons (who need not be directors) appointed by affirmative
vote of a majority of the directors present, and shall be subject at all times
to the direction and control of the Board. A majority of the members of a
committee present at a meeting shall constitute a quorum for the transaction of
business.
3.9 Committee of Disinterested Persons. The Board may establish a
committee composed of two or more disinterested directors or other disinterested
persons to determine whether it is in the best interests of the corporation to
pursue a particular legal right or remedy of the corporation and whether to
cause the dismissal or discontinuance of a particular proceeding that seeks to
assert a right or remedy on behalf of the corporation. For
<PAGE>
purposes of this section, a director or other person is "disinterested" if the
director or other person is not the owner of more than one percent of the
outstanding shares of, or a present or former officer, employee, or agent of,
the corporation or of a related corporation and has not been made or threatened
to be made a party to the proceeding in question. The committee, once
established, is not subject to the direction or control of, or termination by,
the Board. A vacancy on the committee may be filled by a majority vote of the
remaining members. The good faith determinations of the committee are binding
upon the corporation and its directors, officers and shareholders. The committee
terminates when it issues a written report of its determinations to the Board.
3.10 Order of Business. The suggested order of business at any meeting
of the Board of Directors shall, to the extent appropriate and unless modified
by the presiding chairman, be:
(a) Roll call
(b) Proof of due notice of meeting or waiver of notice, or
unanimous presence and declaration by presiding chairman
(c) Determination of existence of quorum
(d) Reading and disposal of any unapproved minutes
(e) Reports of officers and committees
(f) Election of officers
(g) Unfinished business
(h) New business
(i) Adjournment.
ARTICLE FOUR
OFFICERS
4.1 Number and Designation. The corporation shall have one or more
natural persons exercising the functions of the offices of chief executive
officer and chief financial officer. The Board of Directors may elect or appoint
such other officers or agents as it deems necessary for the operation and
management of the corporation including, but not limited to, a Chairman of the
Board, a President, one or more Vice Presidents, a Secretary and a Treasurer,
each of whom shall have the powers, rights, duties and responsibilities set
forth in these Bylaws unless otherwise determined by the Board. Any of the
offices or functions of those offices may be held by the same person.
<PAGE>
4.2 Election, Term of Office and Qualification. At the first meeting of
the Board following each election of directors, the Board shall elect officers,
who shall hold office until the next election of officers or until their
successors are elected or appointed and qualify; provided, however, that any
officer may be removed with or without cause by the affirmative vote of a
majority of the Board of Directors present (without prejudice, however, to any
contract rights of such officer).
4.3 Resignation. Any officer may resign at any time by giving written
notice to the corporation. The resignation is effective when notice is given to
the corporation, unless a later date is specified in the notice, and acceptance
of the resignation shall not be necessary to make it effective.
4.4 Vacancies in Office. If there be a vacancy in any office of the
corporation, by reason of death, resignation, removal or otherwise, such vacancy
shall be filled for the unexpired term by the Board of Directors.
4.5 Chief Executive Officer. Unless provided otherwise by a resolution
adopted by the Board of Directors, the chief executive officer (a) shall have
general active management of the business of the corporation; (b) shall, when
present and in the absence of the Chairman of the Board, preside at all meetings
of the shareholders and Board of Directors; (c) shall see that all orders and
resolutions of the Board are carried into effect; (d) shall sign and deliver in
the name of the corporation any deeds, mortgages, bonds, contracts or other
instruments pertaining to the business of the corporation, except in cases in
which the authority to sign and deliver is required by law to be exercised by
another person or is expressly delegated by the Articles, these Bylaws or the
Board to some other officer or agent of the corporation; (e) may maintain
records of and certify proceedings of the Board and shareholders; and (f) shall
perform such other duties as may from time to time be assigned to him by the
Board.
4.6 Chief Financial Officer. Unless provided otherwise by a resolution
adopted by the Board of Directors, the chief financial officer (a) shall keep
accurate financial records for the corporation; (b) shall deposit all monies,
drafts and checks in the name of and to the credit of the corporation in such
banks and depositories as the Board of Directors shall designate from time to
time; (c) shall endorse for deposit all notes, checks and drafts received by the
corporation as ordered by the Board, making proper vouchers therefor; (d) shall
disburse corporate funds and issue
<PAGE>
checks and drafts in the name of the corporation, as ordered by the Board; (e)
shall render to the chief executive officer and the Board of Directors, whenever
requested, an account of all of his transactions as chief financial officer and
of the financial condition of the corporation; and (f) shall perform such other
duties as may be prescribed by the Board of Directors or the chief executive
officer from time to time.
4.7 Chairman of the Board. The Chairman of the Board shall preside at
all meetings of the shareholders and of the Board and shall exercise general
supervision and direction over the more significant matters of policy affecting
the affairs of the corporation, including particularly its financial and fiscal
affairs.
4.8 President. Unless otherwise determined by the Board, the President
shall be the chief executive officer. If an officer other than the President is
designated chief executive officer, the President shall perform such duties as
may from time to time be assigned to him by the Board.
4.9 Vice President. Each Vice President shall have such powers and
shall perform such duties as may be specified in these Bylaws or prescribed by
the Board of Directors. In the event of absence or disability of the President,
the Board of Directors may designate a Vice President or Vice Presidents to
succeed to the power and duties of the President.
4.10 Secretary. The Secretary shall, unless otherwise determined by the
Board, be secretary of and attend all meetings of the shareholders and Board of
Directors, and may record the proceedings of such meetings in the minute book of
the corporation and, whenever necessary, certify such proceedings. The Secretary
shall give proper notice of meetings of shareholders and shall perform such
other duties as may be prescribed by the Board of Directors or the chief
executive officer from time to time.
4.11 Treasurer. Unless otherwise determined by the Board, the Treasurer
shall be the chief financial officer of the corporation. If an officer other
than the Treasurer is designated chief financial officer, the Treasurer shall
perform such duties as may be prescribed by the Board of Directors or the chief
executive officer from time to time.
<PAGE>
4.12 Delegation. Unless prohibited by a resolution approved by the
affirmative vote of a majority of the directors present, an officer elected or
appointed by the Board may delegate in writing some or all of the duties and
powers of his office to other persons.
ARTICLE FIVE
INDEMNIFICATION
5.1 The corporation shall indemnify such persons, for such expenses and
liabilities, in such manner, under such circumstances, and to such extent, as
permitted by Minnesota Statutes, Section 302A.521, as now enacted or hereafter
amended.
ARTICLE SIX
SHARES AND THEIR TRANSFER
6.1 Certificate of Stock. Every owner of stock of the corporation shall
be entitled to a certificate, in such form as the Board of Directors may
prescribe, certifying the number of shares of stock of the corporation owned by
him. The certificates for such stock shall be numbered (separately for each
class) in the order in which they are issued and shall, unless otherwise
determined by the Board, be signed by the chief executive officer, the chief
financial officer, or any other officer of the corporation. A signature upon a
certificate may be a facsimile. Certificates on which a facsimile signature of a
former officer, transfer agent or registrar appears may be issued with the same
effect as if such person were such officer, transfer agent or registrar on the
date of issue.
6.2 Stock Record. As used in these Bylaws, the term "shareholder" shall
mean the person, firm or corporation in whose name outstanding shares of capital
stock of the corporation are currently registered on the stock record books of
the corporation. The corporation shall keep, at its principal executive office
or at another place or places within the United States determined by the Board,
a share register not more than one year old containing the names and addresses
of the shareholders and the number and classes of shares held by each
shareholder. The corporation shall also keep at its principal executive office
or at another place or places within the United States determined by the Board,
a record of the dates on which certificates representing shares were issued.
Every certificate surrendered to the corporation for exchange or
<PAGE>
transfer shall be cancelled and no new certificate or certificates shall be
issued in exchange for any existing certificate until such existing certificate
shall have been so cancelled (except as provided for in Section 6.4 of this
Article Six).
6.3 Transfer of Shares. Transfer of shares on the books of the
corporation may be authorized only by the shareholder named in the certificate
(or his legal representative or duly authorized attorney-in-fact) and upon
surrender for cancellation of the certificate or certificates for such shares.
The shareholder in whose name shares of stock stand on the books of the
corporation shall be deemed the owner thereof for all purposes as regards the
corporation; provided, that when any transfer of shares shall be made as
collateral security and not absolutely, such fact, if known to the corporation
or to the transfer agent, shall be so expressed in the entry of transfer; and
provided, further, that the Board of Directors may establish a procedure whereby
a shareholder may certify that all or a portion of the shares registered in the
name of the shareholder are held for the account of one or more beneficial
owners.
6.4 Lost Certificate. Any shareholder claiming a certificate of stock
to be lost or destroyed shall make an affidavit or affirmation of that fact in
such form as the Board of Directors may require, and shall, if the directors so
require, give the corporation a bond of indemnity in form and with one or more
sureties satisfactory to the Board of at least double the value, as determined
by the Board, of the stock represented by such certificate in order to indemnify
the corporation against any claim that may be made against it on account of the
alleged loss or destruction of such certificate, whereupon a new certificate may
be issued in the same tenor and for the same number of shares as the one alleged
to have been destroyed or lost.
ARTICLE SEVEN
GENERAL PROVISIONS
7.1 Distributions: Acquisitions of Shares. Subject to the provisions of
law, the Board of Directors may authorize the acquisition of the corporation's
shares and may authorize distributions wherever and in such amounts as, in its
opinion, the condition and the affairs of the corporation shall render it
advisable.
<PAGE>
7.2 Fiscal Year. The fiscal year of the corporation shall be
established by the Board of Directors.
7.3 Seal. The corporation shall have such corporate seal or no
corporate seal as the Board of Directors shall from time to time determine.
7.4 Securities of Other Corporations.
(a) Voting Securities Held by the Corporation. Unless otherwise ordered
by the Board of Directors, the chief executive officer shall have full power and
authority on behalf of the corporation (i) to attend and to vote at any meeting
of security holders of other companies in which the corporation may hold
securities; (ii) to execute any proxy for such meeting on behalf of the
corporation; and (iii) to execute a written action in lieu of a meeting of such
other company on behalf of this corporation; provided, however, that any vote
cast shall be in direct proportion to the way in which each director of the
corporation would have voted on the matter in question, if given the opportunity
so to vote. At such meeting, by such proxy or by such writing in lieu of
meeting, the chief executive officer shall, subject to the provisions of this
section, possess and may exercise any and all rights and powers incident to the
ownership of such securities that the corporation might have possessed and
exercised if it had been present. The Board of Directors may from time to time
confer like powers upon any other person or persons.
(b) Purchase and Sale of Securities. Upon unanimous approval of the
Board of Directors, the chief executive officer shall have full power and
authority on behalf of the corporation to purchase, sell, transfer or encumber
securities of any other company owned by the corporation which represent not
more than 10% of the outstanding securities of such issuer, and may execute and
deliver such documents as may be necessary to effectuate such purchase, sale,
transfer or encumbrance. The Board of Directors may from time to time confer
like powers upon any other person or persons.
ARTICLE EIGHT
MEETINGS
8.1 Waiver of Notice. Whenever any notice whatsoever is required to be
given by these Bylaws, the Articles of Incorporation or any of the laws of the
State of Minnesota, a waiver thereof given by the person or persons entitled to
such notice, whether
<PAGE>
before, at or after the time stated therein and either in writing, orally or by
attendance, shall be deemed equivalent to the actual required notice.
8.2 Conference Meetings and Participation. A conference among directors
by any means of communication through which the directors may simultaneously
hear each other during the conference constitutes a Board meeting, if the same
notice is given of the conference as would be required for a meeting, and if the
number of directors participating in the conference would be sufficient to
constitute a quorum at a meeting. Participation in a meeting by that means
constitutes presence in person at the meeting. A director may participate in a
Board meeting not heretofore described in this paragraph, by any means of
communication through which the director, other directors so participating, and
all directors physically present at the meeting may simultaneously hear each
other during the meeting. Participation in a meeting by that means constitutes
presence in person at the meeting. The provisions of this section shall apply to
committees and members of committees to the same extent as they apply to the
Board and directors.
8.3 Authorization Without Meeting. Any action of the shareholders, the
Board of Directors, or any committee of the corporation which may be taken at a
meeting thereof, may be taken without a meeting if authorized by a writing
signed by all of the holders of shares who would be entitled to vote on such
action, by all of the directors (unless less than unanimous action is permitted
by the Articles of Incorporation), or by all of the members of such committee,
as the case may be.
ARTICLE NINE
AMENDMENTS OF BYLAWS
9.1 Amendments. Unless the Articles of Incorporation provide otherwise,
these Bylaws may be altered, amended, added to or repealed by the majority vote
of the members of the Board of Directors. Such authority in the Board of
Directors is subject to the power of the shareholders to change or repeal such
Bylaws, and the Board of Directors shall not make or alter any Bylaws fixing a
quorum for meetings of shareholders, prescribing procedures for removing
directors or filling vacancies on the Board, or fixing the number of directors
or their classifications, qualifications or terms of office, but the Board may
adopt or amend a Bylaw to increase the number of directors.
<PAGE>
The undersigned, Secretary of Tri Tec Industries, Inc. hereby certifies
that the foregoing Bylaws were duly adopted as the initial Bylaws of the
corporatin by its Board of Directors as of March 1, 1995.
/s/ John F. McManus
Secretary
<PAGE>
TriTec Industries, Inc.
7901 Flying Cloud Dr Suite 245 Eden Prairie, Minnesota 55344 USA
Telephone: 612/942-5282 Facsimile: 612/942-5357
March 1, 1995
AMENDMENT TO BYLAWS
The Bylaws of TriTec Industries, Inc., adopted on March 1, 1995 is hereby
amended by the Incorporators of TriTec Industries, Inc.
1. Page 4, Paragraph 3.2: The number of possible Directors shall be 9 members.
The above has been approved by election of the Incorporators.
/s/ Eugene Chessen
Eugene Chessen
/s/ Willis Black
Willis Black
[CHARLES CLAYTON LETTERHEAD]
ATTORNEY AT LAW
Exhibit 5
January 29, 1998
TriTec Industries, Inc.
47901 Flying Cloud Drive
Eden Prairie, Minnesota
Gentlemen:
I have acted as counsel for the company in connection with the
preparation of the Registration Statement, and, based on this, I am of the
opinion that:
1. The company is a corporation, duly organized, validly existing, and
in good standing under the laws of the State of Nevada, with corporate authority
to conduct the business in which it is now engaged, and as described in the
Registration Statement.
2. There is not pending, or to the knowledge of counsel, threatened,
any action, suit, or proceeding before or by any court or governmental agency or
body to which the company is a party, or to which any property of the company is
subject, and which, in the opinion of counsel, could result in a material
adverse change in the business, business prospects, financial position or
results of operations, present or prospective, of the company or of its
properties or assets.
3. There is no liquidation preference for any shareholder, common or
preferred, all have the same standing in regard to liquidation.
Cordially,
/s/ CHARLES CLAYTON
Exhibit 10.1
GOVERNMENT OF BARBADOS
No.: 2517
INTERNATIONAL BUSINESS COMPANY LICENCE
This is to certify that GOLD HILL HOLDINGS INC. whose address is Parker
House, Wildey Business Park, Wildey Road, St. Michael is hereby authorised to
conduct international business in accordance with the provisions of the
International Business Companies Act, 1991.
Dated this 30th day of July 1997.
/s/ illegible
MINISTER RESPONSIBLE FOR INTERNATIONAL BUSINESS
<PAGE>
CLARKE & CO.
Attorneys-at-Law
"Parker House"
Wildey Business Park
Wildey Road, St. Michael
Barbados
Telephone No: (246) 436 6287 Facsimile No: (246) 436 9812
FACSIMILE MESSAGE COVER SHEET
Date: 30 July 1997
To: Life Management Corporation
Attention: Mr. Giovanni Camporese
Country: Canada
Fac No.: 1 604 942 0530
From: Ms. Gillian Clarke
No. of pages (this page included): 9
IF YOU DO NOT RECEIVE ALL THE PAGES AS SHOWN ABOVE, PLEASE CALL US BACK
IMMEDIATELY AT 246-436 6287.
Our Ref: CMHC\LIFEMAN\002
Subject: Gold Hill Holdings Inc.
Message:
We attach for your information a copy of the incorporation documents
for Gold Hill Holdings Inc.
Regards
Gillian Clarke
:sr
Encs.
<PAGE>
FORM 3
14023
COMPANY NO.
COMPANIES ACT OF BARBADOS
CERTIFICATE OF INCORPORATION
GOLD HILL HOLDINGS INC.
NAME OF COMPANY
I hereby certify that the above-mentioned Company, the Articles of Incorporation
of which are attached, was incorporated under the Companies Act of Barbados.
/s/ Maureen Crane-Scott
REGISTRAR OF COMPANIES
July 24th, 1997
DATE OF INCORPORATION
<PAGE>
FORM 4
COMPANIES ACT OF BARBADOS
(SECTION 169(1) AND (2))
NOTICE OF ADDRESS
OR
NOTICE OF CHANGE OF ADDRESS
OF REGISTERED OFFICE
1. NAME OF COMPANY 2. COMPANY NO.
Gold Hill Holdings Inc 14023
3. ADDRESS OF REGISTERED OFFICE
Parker House
Wildey Business Park
Wildey Road
St. Michael
4. MAILING ADDRESS
Life Management Corporation
1560 Broadway Street
Port Coquitlam
British Columbia
Canada V3C 6E6
5. IF CHANGE OF ADDRESS, GIVE PREVIOUS ADDRESS OF REGISTERED OFFICE.
N/A
6. DATE SIGNATURE TITLE
/s/ Gillian M.H. Clarke
23 July 1997 GILLIAN M.H. CLARKE Incorporator
FOR MINISTRY USE ONLY REGISTERED CORPORATE AFFAIRS AND
INTELLECTUAL PROPERTY OFFICE
Company No. 14023 Filed 1997-07-24
<PAGE>
FORM 9
COMPANIES ACT OF BARBADOS
(SECTIONS 66 & 74)
NOTICE OF DIRECTORS
OR
NOTICE OF CHANGE OF DIRECTORS
1. NAME OF COMPANY 2. COMPANY NO.
Gold Hill Holdings Inc. 14023
3. NOTICE IS GIVEN THAT ON THE ___________________ DAY OF ____________ 19
__________, THE FOLLOWING PERSON(S) WAS/WERE APPOINTED DIRECTOR(S):
NAME MAILING ADDRESS OCCUPATION
N/A
4. NOTICE IS GIVEN THAT ON THE ____________________ DAY OF ____________ 19
_________, THE FOLLOWING PERSON(S) CEASED TO HOLD OFFICE AS DIRECTOR(S):
NAME MAILING ADDRESS
N/A
5. THE DIRECTORS OF THE COMPANY AS OF THIS DATE ARE:
NAME MAILING ADDRESS OCCUPATION
The attached Schedule is incorporated in this form
REGISTERED CORPORATE AFFAIRS AND
INTELLECTUAL PROPERTY OFFICE
6. DATE SIGNATURE TITLE
/s/ GILLIAN M.H. CLARKE
23 July 1997 GILLIAN M.H. CLARKE Incorporator
<PAGE>
COMPANIES ACT OF BARBADOS
(Sections 66 & 74)
SCHEDULE TO NOTICE OF DIRECTORS
(FORM 9)
1. NAME OF COMPANY 2. COMPANY NO.
Gold Hill Holdings Inc. 14023
5. THE DIRECTORS OF THE COMPANY AS OF THIS DATE ARE:
NAME MAILING ADDRESS OCCUPATION
Giovanni Camporese 3435 Falaise Avenue Businessman
(no middle initial) Vancouver, British
Columbia, Canada
V5M 4L5
Anthony Papalia 1390 Ottawa Avenue Businessman
(no middle initial) W. Vancouver
British Columbia
Canada V7T 2HS
Eugene W. Chessen 7901 Flying Cloud Businessman
Drive, Suite 200
Eden Prairie
Minnesota, USA 55344
Willis E. Black 7901 Flying Cloud Businessman
Drive, Suite 200
Eden Prairie
Minnesota, USA 55344
6. DATE SIGNATURE TITLE
/s/ GILLIAN M.H. CLARKE
23 July 1997 GILLIAN M.H. CLARKE Incorporator
REGISTERED CORPORATE AFFAIRS AND
INTELLECTUAL PROPERTY OFFICE
<PAGE>
FORM 1
COMPANIES ACT OF BARBADOS
(SECTION 5)
ARTICLES OF INCORPORATION
NAME OF COMPANY COMPANY NO:
Gold Hill Holdings Inc. 14023
2. THE CLASSES AND ANY MAXIMUM NUMBER OF SHARES THAT THE COMPANY IS AUTHORIZED
TO ISSUE
100,000,000 common shares without nominal or par value
3. RESTRICTION IF ANY ON SHARE TRANSFERS
The attached Schedule A is incorporated in this form
4. NUMBER (OR MINIMUM AND MAXIMUM NUMBER) OF DIRECTORS
There shall be a minimum of one (1) and a maximum of nine (9)
5. RESTRICTIONS IF ANY ON BUSINESS THE COMPANY MAY CARRY ON
The Company shall not engage in business other than international business as
defined in the International Business Companies Act, 1991-24
6. OTHER PROVISIONS IF ANY
The attached Schedule 8 is incorporated in this form
7. INCORPORATORS DATE 23 July 1997
NAMES ADDRESS Signature
Gillian M.H. Clarke 19 Farringdon Close /s/ Gillian M.H. Clarke
Paradise Heights
St. Michael
Barbados
REGISTERED
SIGNATURE /s/ illegible
DATE 97-07-24
CORPORATE AFFAIRS AND
INTELLECTUAL PROPERTY OFFICE
FOR MINISTRY USE ONLY
Company No. 14023 Filed 1997-07-24
<PAGE>
Companies Act Chapter 308
(Section 5)
Gold Hill Holdings Inc.
Company No. 14023
SCHEDULE TO ARTICLES OF INCORPORATION
(Form 1)
SCHEDULE A
----------
2. Restrictions if any on share transfers
No shares of any class of the Company shall be issued or sold by the Company
unless either all the holders of shares of that class of the Company by an
instrument or instruments in writing signed by all such shareholders consent
thereto or such shares are first offered by the Company, at a price per
share determined or fixed by the directors, in the first instance to all the
holders of shares of that class of the Company as nearly as may be in
proportion to the number of shares of that class held by them respectively
at the date of such offer; such offer shall specify such price, shall limit
the time within which the offer, if not accepted, will be deemed to be
declined (which time shall be not less than 30 days nor more than 60 days
after the date of such offer) and shall state that any shareholder who
desires to subscribe for or purchase a number of shares so offered in excess
of his proportion shall in his reply state how many shares in excess of his
proportion he desires to subscribe for or purchase; and if all the holders
of shares of that class do not claim their respective proportions, the
unclaimed shares so offered shall be used for satisfying the claims of
holders of shares of that class for shares in excess of their proportions
and if the claims in excess are more than sufficient to exhaust such
unclaimed shares the unclaimed shares shall be divided pro rata among the
holders of shares of that class desiring excess shares in proportion to
their existing holdings of such shares but so that no shareholder shall be
bound to take any shares in excess of the amount which he desires; if any
shares shall not be capable of being offered to or being divided among the
7. Incorporator Date: 23 July 1997
NAME ADDRESS SIGNATURE
Gillian M.H. Clarke 19 Farringdon Close /s/ Gillian M.H. Clarke
Paradise Heights
St. Michael
Barbados
REGISTERED CORPORATE AFFAIRS AND
INTELLECTUAL PROPERTY OFFICE
<PAGE>
Companies Act Chapter 308
(Section 5)
Gold Hill Holdings Inc.
Company No. 14023
SCHEDULE TO ARTICLES OF INCORPORATION
(Form 1)
holders of shares of that class in proportion to their existing holdings of such
shares without division into fractions of shares, the same shall be offered to
or divided among the holders of shares of that class as nearly as may be in
proportion to the number of such shares held by them respectively at the date of
such offer as may be determined by the board of directors of the Company; if any
of the shares covered by the offer shall be subscribed for or purchased by
holders of shares of that class pursuant to the foregoing provisions of this
clause then the shares so subscribed for or purchased shall be issued at the
said price; if by the time limited by the said offer all the shares offered
thereby have not been subscribed for or purchased by shareholders at the said
price, the Company may within six calendar months from the date of the said
offer issue such number of shares as shall not have been subscribed for or
purchased by shareholders of the Company pursuant to the provisions of this
clause to any person or persons at a price not less than the said price but not
after the expiration of the said six calendar months without either all the
holders of shares of that class of the Company by an instrument or instruments
in writing signed by all such shareholders consenting thereto or an offer being
again made to holders of shares of that class in respect of the shares not
heretofore issued pursuant to the foregoing provisions.
SCHEDULE B
6. Other Provisions if any
(a) No more than one-tenth of the sums which, on a liquidation of the
Company are recoverable by holders of its share or loan capital shall
be recoverable
7. Incorporator Date: 23 July 1997
NAME ADDRESS SIGNATURE
Gillian M.H. Clarke 19 Farringdon Close
Paradise Heights
St. Michael
Barbados /s/ Gillian M.H. Clarke
REGISTERED CORPORATE AFFAIRS AND
INTELLECTUAL PROPERTY OFFICE
<PAGE>
Companies Act Chapter 308
(Section 5)
Gold Hill Holdings Inc.
Company No. 14023
SCHEDULE TO ARTICLES OF INCORPORATION
(Form 1)
directly or indirectly by or for the benefit of persons resident in
the Caricom region who are holders of its share capital and who do not
carry on an international business;
(b) No more than one-tenth of the assets which, on a liquidation of the
Company, are to be available for distribution after the payment of
creditors shall be available directly or indirectly for distribution
to or for the benefit of individuals resident in the Caricom region;
(c) No more than one-tenth
(i) of the interest payable on the Company's loans and loan capital,
if any; and
(ii) of the dividends payable on the Company's preference shares, if
any; and
(iii) of the dividends payable on any ordinary share of the Company,
would be paid directly or indirectly to or for the benefit of
individuals resident in the Caricom region.
7. Incorporator Date: 23 July 1997
NAME ADDRESS SIGNATURE
Gillian M.H. Clarke 19 Farringdon Close
Paradise Heights
St. Michael
Barbados /s/ Gillian M.H. Clarke
REGISTERED CORPORATE AFFAIRS AND
INTELLECTUAL PROPERTY OFFICE
<PAGE>
STATE OF NEVADA
SECRETARY OF STATE
I HEREBY CERTIFY THAT THIS IS A TRUE AND COMPLETE COPY OF THE DOCUMENT
AS FILED IN THIS OFFICE.
Jun 24 '96
/s/ Dean Heller
DEAN HELLER
SECRETARY OF STATE
BY /s/ Rick illegible
<PAGE>
SIXTY DAY LIST OF OFFICERS, DIRECTORS AND AGENT OF File Number
TRITEC INDUSTRIES, INC. INCORPORATION DATE: 6/24/96 13803-96
A NEVADA CORPORATION. FOR THE FILING PERIOD 6/96 TO 6/97
The Corporation's duly appointed Resident Agent in the State of Nevada upon whom
process can be served is.:
JAN CABOT #32723
1517 GOLDFIELD AVE.
CARSON CITY, NV 89701
[ ] IF THE ABOVE INFORMATION IS INCORRECT, PLEASE CHECK THIS BOX AND A CHANGE OF
RESIDENT AGENT/ADDRESS FORM WILL BE SENT.
PLEASE READ INSTRUCTIONS BEFORE COMPLETING AND RETURNING THIS FORM.
1. Print or type names and addresses, either residence or business, for all
officers and directors. A president, secretary, treasurer and at least one
director must be named.
2. Have an officer sign the form. FORM WILL BE RETURNED IF UNSIGNED.
3. Return the completed form with the $65.00 filing fee. A $15.00 penalty must
be added for failure to file this form within 60 days from the date of
Incorporation.
4. Make your check payable to the Secretary of State. If you need a receipt,
enclose a self-addressed stamped envelope. To receive a certified copy,
enclose a copy of this completed form, an additional $10.00 and appropriate
instructions.
5. Return the completed form to: Jan Cabot 9710 (702) 687-5105
FILING FEE: $65.00 LATE PENALTY: $15.00
THIS FORM MUST BE FILED 60 DAYS FROM THE DATE OF INCORPORATION
NAME TITLE
Willis Black PRESIDENT
P.O. BOX STREET ADDRESS CITY STATE ZIP
104 W. Island Av. Minneapolis MN 55401
NAME TITLE
John McManus SECRETARY
P.O. BOX STREET ADDRESS CITY STATE ZIP
9222 Hyland Creek Rd. Bloomington MN 55437
NAME TITLE
Willis Black TREASURER
P.O. BOX STREET ADDRESS CITY STATE ZIP
104 W. Island Av. Minneapolis MN 55401
NAME TITLE
Willis Black DIRECTOR
P.O. BOX STREET ADDRESS CITY STATE ZIP
104 W. Island Av. Minneapolis MN 55401
NAME TITLE
John McManus DIRECTOR
P.O. BOX STREET ADDRESS CITY STATE ZIP
9222 Hyland Creek Rd. Bloomington MN 55437
NAME TITLE
Eugene Chessen DIRECTOR
P.O. BOX STREET ADDRESS CITY STATE ZIP
4705 Maple Chase Deephaven MN 55331
Hereby certify this 60 day Net.
Title(s) Date
Signature of officer
Exhibit 10.2
FORM 2
4259
COMPANY NO.
COMPANIES ACT OF GUYANA
(SECTION B)
CERTIFICATE OF INCORPORATION
GOLD HILL (GUYANA) INCORPORATED
NAME OF COMPANY
I hereby certify that the above mentioned Company, the Articles of Incorporation
of which are attached, was incorporated under the Companies Act of Guyana.
[SEAL] REGISTRAR OF JOINT STOCK COMPANIES GUYANA
/s/ illegible
Registrar of Companies
6th August, 1997
Date of Incorporation
<PAGE>
COMPANIES ACT OF GUYANA
(SECTION 5)
ARTICLES OF INCORPORATION
1. NAME OF COMPANY: COMPANY NO:
GOLD HILL (GUYANA) INCORPORATED
2. THE CLASSES AND ANY MAXIMUM NUMBER OF SHARES THAT THE COMPANY IS AUTHORIZED
TO ISSUE
1000 (one thousand) shares at $100.00 each
3. RESTRICTION IF ANY ON SHARE TRANSFERS
Right of pre-emption of other members
4. NUMBER (OR MINIMUM AND MAXIMUM NUMBER) OF DIRECTORS
minimum of 2 but not more than 10
5. RESTRICTIONS IF ANY ON BUSINESS THE COMPANY MAY CARRY ON
None
6. OTHER PROVISIONS, IF ANY.
None
[SEAL] REGISTRAR OF JOINT STOCK COMPANIES GUYANA
7. INCORPORATORS: DATE: 31 - 7 - 97
NAMES ADDRESS SIGNATURE
Will Black 7901 Flying Cloud Drive /s/ Will Black
Suite 200, Eden Prairie,
Minnesota, 55344 U.S.A.
Giovanni Camporese 1560 Broadway Street /s/ G. Camporese
Port Coquitlam,
British Columbia V3C 6E6
Canada.
Certified a True Copy
/s/ illegible
Assistant Sworn Clerk
97-08-18
<PAGE>
FORM 3
COMPANIES ACT OF GUYANA
(SECTION 188 (1) AND (2)
NOTICE OF ADDRESS
1. NAME OF COMPANY: 2. COMPANY NO:
GOLD HILL (GUYANA) INCORPORATED
3. ADDRESS OF REGISTERED OFFICE
1 Croal Street,
Stabroek,
Georgetown,
Guyana.
4. MAILING ADDRESS
1 Croal Street,
Stabroek,
Georgetown,
Guyana.
5. IF CHANGE OF ADDRESS, GIVE PREVIOUS ADDRESS OF REGISTERED OFFICE
Not applicable
[SEAL] REGISTRAR OF JOINT STOCK COMPANIES GUYANA
6. DATE SIGNATURE TITLE
31 - 7 - 97
/s/ Will Black
Incorporators
/s/ G. Camporese
Certified a True Copy
/s/ illegible
Assistant Sworn Clerk
<PAGE>
FORM 8
COMPANIES ACT OF GUYANA
(SECTION 67 AND 75)
NOTICE OF DIRECTORS
1. NAME OF COMPANY: 2. COMPANY NO:
GOLD HILL (GUYANA) INCORPORATED
3. NOTICE IS GIVEN THAT ON THE DAY OF JULY, 1997 THE FOLLOWING PERSONS
WERE APPOINTED AND ARE DIRECTORS OF THE COMPANY AS OF THIS DATE.
NAME MAILING ADDRESS OCCUPATION
Will Black 7901 Flying Cloud Drive Businessman
Suite 200, Eden Prairie,
Minnesota, 55344
U.S.A.
Giovanni Camporese 1560 Broadway Street, Businessman
Port Coquitlam,
British Columbia,
V3C 6E6, Canada
[SEAL] REGISTRAR OF JOINT STOCK COMPANIES GUYANA
DATE: SIGNATURE TITLE
31 - 7 - 97 /s/ Will Black
Incorporators
/s/ G. Camporese
Certified a True Copy
/s/ illegible
Assistant Sworn Clerk
<PAGE>
COMPANIES ACT
NO. 29 OF 1991
CONSENT TO ACT AS DIRECTORS
OF
GOLD HILL (GUYANA) INCORPORATED
WE, WILL BLACK of 7901 Flying Cloud Drive, Suite 200, Eden Prairie, Minnesota,
55344 U.S.A. And GIOVANNI CAMPORESE of 1560 Broadway Street, Port Coquitlam,
British Columbia, V3C 6E6 Canada do hereby consent to act as Directors of GOLD
HILL (GUYANA) INCORPORATED.
/s/ Will Black
/s/ G. Camporese
[SEAL] REGISTRAR OF JOINT STOCK COMPANIES GUYANA
DATED this 31st day of July, 1997
Certified a True Copy
/s/ illegible
Assistant Sworn Clerk
<PAGE>
COMPANIES ACT OF GUYANA
NO. 29 OF 1991
(SECTION 67(1)
NOTICE OF SECRETARY
1. NAME OF COMPANY: 2. COMPANY NO:
GOLD HILL (GUYANA) INCORPORATED
3. NOTICE IS GIVEN THAT ON THE DAY OF JULY, 1997 THE FOLLOWING PERSON
WAS APPOINTED SECRETARY.
NAME MAILING ADDRESS OCCUPATION
Giovanni Camporese 1560 Broadway Street, Businessman
Port Coquitlam,
British Columbia,
V3C 6E6. Canada
4. NOTICE IS GIVEN THAT ON THE DAY OF JULY, 1997 THE FOLLOWING PERSON
CEASED TO HOLD OFFICE AS SECRETARY.
NAME MAILING ADDRESS
[SEAL] REGISTRAR OF JOINT STOCK COMPANIES GUYANA
5. THE SECRETARY OF THE COMPANY AS OF THIS DATE IS:
NAME MAILING ADDRESS OCCUPATION
Giovanni Camporese 1560 Broadway Street, Businessman
Port Coquitlam,
British Columbia,
V3C 6E6. Canada
6. DATE SIGNATURE TITLE
31/7/97 /s/ Will Black Incorporators
/s/ G. Camporese
Certified a True Copy
/s/ illegible
Assistant Sworn Clerk
<PAGE>
COMPANIES ACT
NO. 29 OF 1991
CONSENT TO ACT AS SECRETARY
OF
GOLD HILL (GUYANA) INCORPORATED
I, GIOVANNI CAMPORESE of 1560 Broadway Street, Port Coquitlam, British Columbia,
V3C 6E6, Canada do hereby consent to to act as Secretary of GOLD HILL (GUYANA)
INCORPORATED.
/s/ G. Camporese
[SEAL] REGISTRAR OF JOINT STOCK COMPANIES GUYANA
DATED this 31st day of July, 1997
Certified a True Copy
/s/ illegible
Assistant Sworn Clerk
<PAGE>
COMPANIES ACT
NO. 29 OF 1991
DECLARATION OF COMPLIANCE
I, VIDYANAND PERSAUD of Lot 1 Croal Street, Stabroek, Georgetown, Demerara,
being duly sworn, make oath and say as follows:
1. I am the Attorney-at-Law engaged in the formation of GOLD HILL (GUYANA)
INCORPORATED, and I say that all the requirements of the Companies Act No. 29 of
1991 in respect of the matters precedent to the registration of the said Company
and incidental thereto have been complied with.
2. That none of the Directors are less than 18 years or are of unsound mind.
3. That I make this Declaration conscientiously believing the same to be true
and correct and in accordance with the provisions of the Statutory Declarations
Act, Chapter 5:09.
/s/ illegible??
DECLARED to at Georgetown, Demerara
on this 31st day of July, 1997
[SEAL] REGISTRAR OF JOINT STOCK COMPANIES GUYANA
BEFORE ME
/s/ Dr. Pt. Anand:M:Sriram J.P.
A COMMISSIONER FOR OATHS TO AFFIDAVITS
[SEAL]
Dr. Pt. Anand:M:Sriram J.P.
MINISTER OF RELIGION
COMMISSIONER OF OATHS
JUSTICE OF THE PEACE
MARRIAG OFFICER
Certified a True Copy
/s/ illegible
Assistant Sworn Clerk
97-08-18
Exhibit 10.3
JOINT VENTURE AGREEMENT
July 1,1997
BETWEEN:
TRITEC INDUSTRIES, INC. a company duly incorporated under the laws of
the State of Nevada, and having an office at 7901 Flying Cloud Drive,
Suite 200, Eden Prairie, Minnesota, 55344
AND: EARTH TECHNOLOGIES, INC. a company duly incorporated under the laws of
the State of Minnesota, and having an office at 7901 Flying Cloud Drive,
Suite 200, Eden Prairie, Minnesota, 55344
AND: A & A FOODS, LTD. a company duly incorporated under the laws of the
Province of British Columbia, and having an office at 1560 Broadway
Street, Port Coquitlam, B.C., V3C 6E6
AND: AIC INTERNATIONAL RESOURCES CORPORATION, a company duly incorporated
under the laws of the Province of British Columbia, and having an office
at 1560 Broadway Street, Port Coquitlam, B.C., V3C 6E6
AND: PACRIM INFORMATION SYSTEMS, INC. a company duly incorporated under the
laws of the State of California, in the United States of America, with
offices at 1390 Ottawa Avenue, West Vancouver, B.C., V7T 2H5
(hereby called the "Co-Venturers")
RE: GOLD HILL HOLDINGS, INC.
WHEREAS:
A. The Co-Venturers have agreed to enter into a Joint Venture Agreement to
purchase a 100% gross interest (subject to various percentages of
royalty interest) in and to certain mining concessions and/or leases
located in the Upper Mazarumi River Region of Western Guyana (herein
referred to as the "Properties"). The first of which is more
particularly described in Scedule "A".
B. The Co-Venturers wish to establish jointly a corporation, Gold Hill
Holdings, Inc. ("Gold Hill") or any other acceptable name under a
foreign jurisdiction. The Co-Venturers intend to invest and capitalize
the foreign corporation in accordance with the percentage set out in the
agreement and the foreign corporation will acquire and own the
properties.
<PAGE>
NOW THEREFORE THE AGREEMENT WITNESSETH THAT for and in consideration of the
premises, covenants and agreements, herein set forth, the parties hereto agree
as follows.
1. The 100% interest in Gold Hill should be divided among the Co-Venturers
as follows:
TriTec Industries, Inc. 47.5%
Earth Technologies, Inc. 2.5%
A & A Foods, Ltd. 20.0%
Pacrim Information Systems, Inc. 20.0%
AIC International Resources, Inc. 10.0%
-----
100.0%
In the event that Pacrim Information Systems, Inc. and/or AIC
International Resources Corporation will be unable to participate in
this Joint Venture Agreement, A & A Foods, Ltd., will acquire such
interest without any compensation to either company.
2. In consideration for the acquisition of the interest in Gold Hill, the
Co-Venturers hereby agree to pay either in U.S. Dollars and/or in shares
at a deemed value of U.S. $1.00 per share, according to the formula
agreed in paragraph 1. The initial capital shall be U.S. $2,000,000 and
shall be paid and/or allocated by July 31, 1997.
3. Initially four (4) directors shall be appointed as qualified
representatives to the Board of Directors of Gold Hill. TriTec
Industries and Earth Technologies shall each appoint one director, and
A & A Foods shall appoint the remaining two directors.
4. This Joint Venture Agreement is subject to any required regulatory
approval.
IN WITNESS WHEREOF this Joint Venture Agreement has been executed the day and
year first above written.
TRITEC INDUSTRIES, INC. WITNESS
/s/ Will Black /s/ illegible
Will Black, President
<PAGE>
EARTH TECHNOLOGIES, INC. WITNESS
/s/ Will Black /s/ Carol S. Flint
Will Black, President
A&A FOODS, LTD. WITNESS
/s/ Lorne Brown /s/ illegible
Lorne Brown, President
PACRIM INFORMATION SYSTEMS WITNESS
/s/ Anthony Papalia /s/ illegible
Anthony Papalia, President
AIC INTERNATIONAL RESOURCES, INC. WITNESS
/s/ Charles Hutton /s/ illegible
Charles Hutton, President
Exhibit 10.4
GOLD & DIAMOND MINER'S ASSOCIATION
MEMBERSHIP CARD
Name GOLD HILL INC. (WILLIS BLACK)
Address 1 CROAL STREET STABROEK
Mem. I.D. No 1561
Date of Issue 27TH AUGUST, 1997
/s/ Will B. Black
Signature
LICENCE TO TRADE IN VALUABLE MINERALS
AND PRECIOUS STONES
GENERAL 4851 LICENCE REVENUE
Bond No. CASH
(SEAL) GEORGETOWN District
Permission is hereby granted to
GOLD HILL (GUYHNA) INC
of 279 FORSHAW STREET QUEENSTOWN
To purchase or sell Valuable Minerals & Precious Stones under and subject to the
Mining Regulations in a Shop situate at 279 FORSHAW STREET QUEENSTOWN
from the date hereof to the 31st December, 1997 inclusive, he having paid
the sum of FIFTEEN THOUSAND DOLLARS for this Licence.
Value $15,000.00
Date 2ND SEPT. 1997 /s/ illegible
Commissioner
[STAMP]
GUYANA GEOLOGY & MINES COMMISSION
Mines 258.
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANT
We consent to the inclusion in this registration statement Form 10SB of our
report, which includes an explanatory paragraph relating to the unaudited
financial statements as of July 31, 1997, not being in accordance with generally
accepted accounting principles, dated July 31, 1997, except for the explanatory
paragraph as to which the date is December 12, 1997, on our audits of the
financial statements of Tritec Industries, Inc. and Subsidiaries as of December
31, 1996 and 1995 and for the years then ended.
/s/ Stirtz Bernards Boyden Surdel & Larter, P.A.
Stirtz Bernards Boyden Surdel & Larter, P.A.
Edina, Minnesota
December 12, 1997
