SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS UNDER SECTION 12(b)
OR 12(g) OF THE SECURITIES EXCHANGE OF 1934
Global Seafood Technologies, Inc.
---------------------------------
(Name of Small Business Issuer in Its Charter)
State of Nevada 95-4117828
- --------------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
555 Bayview Avenue, Biloxi, Mississippi 39530
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(Address of Principal Executive Offices)
(228) 435-3632
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Issuers telephone number
Securities to be registered pursuant to Section 12(b) of the Act: None
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock
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(Title of class)
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PART I
ITEM 1. DESCRIPTION OF THE BUSINESS
GENERAL
The company's principal line of business is the full-service processing,
packaging, and storage of shrimp and other seafood. This business is principally
conducted through a wholly-owned subsidiary, Custom Pack, Inc. ("Custom Pack").
The company maintains an Aquaculture Division within Custom Pack, which is
engaged in the production of freshwater prawns. The company also packages and
distributes recreational fishing bait products through its Killer Bee, Inc.
subsidiary.
Custom Pack was incorporated under the laws of the State of Mississippi on
February 15, 1988. Through a reverse merger completed on October 31, 1995,
Custom Pack became a wholly-owned subsidiary of International Custom Pack, Inc.,
the successor in name to predecessor entities Enviro Solutions International,
Inc. and Rue de Rivoli Perfumeries of America, Ltd., incorporated in Nevada on
May 29, 1986. On December 21, 1998 the company changed its name to Global
Seafood Technologies, Inc. to reflect the expansion of business activities
beyond the core business of seafood processing and packaging. The expanded
activities include production of seafood, and processing, packaging, and
distribution of bait products for recreational fishing.
INDUSTRY OVERVIEW AND COMPETITION
According to data provided by the United Nations Food and Agricultural
Organization, the annual worldwide market for seafood products is in excess of
$50 billion, of which the United States market is approximately $8 billion.
Consumption demand for seafood products, and principally shrimp, has risen
steadily throughout the last two decades.
The worldwide market for shrimp is the largest segment of the industry at
$30 billion. The United States shrimp market was estimated at $2.5 billion.
Shrimp is the number one seafood in this country, with annual consumption
averaging 2.7 lbs per person in 1997. Approximately 75% of the shrimp consumed
worldwide are caught in the oceans, and about 25% are grown in aquaculture.
The seafood industry is very fragmented. It is characterized by thousands
of suppliers and middlemen throughout the distribution chain from product
procurement, to wholesale distributors, and to retail food stores or
restaurants. Seafood is sold fresh or frozen in blocks or by Individual Quick
Freeze ("IQF") methods. The company is one of the IQF processors of seafood in
the United States.
There is no major player in the seafood industry that commands a
significantly large market share, creates a nationally recognized brand name, or
establishes descriptive product standards. Products like shrimp are sold on a
commodity-type basis with little uniformity of size or species. Restaurants,
supermarkets, and other outlets buy a variety of products from a variety
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of suppliers. Product availability and consistency of quality are important
factors in the service provided.
The company does not operate under government contracts or other long-term
contracts and has no backlog.
The recreational bait industry represents a $1.0 billion sales market
annually in the United States, according to Department of Commerce Wildlife and
Fisheries 1996 data. The company is not aware of any single dominant company or
nationally recognized brand name for bait products.
STATUTORY AND REGULATORY CHANGES
Hazard Analysis and Critical Control Point ("HACCP") regulations took
effect in the seafood processing industry in December 1997. The company's plants
were in compliance in advance of the effective date and are fully approved.
Compliance with HACCP will not affect the company's operations, but compliance
may affect competition, which might not be in the same position.
The discharge of water wastes from company facilities is in full compliance
with existing government regulations and standards. The company does not
envision that any significant capital expenditures will be required for
environmental control procedures for the foreseeable future.
COMPANY STRATEGY
In its core business activities, the company has established itself to
provide an increasing variety of seafood items, which are of consistent quality
and are conveniently packaged for commercial or consumer use. The company will
continue to focus on packaging innovations and value-added specialty entrees to
expand sales and increase margins in these areas.
The recreational bait segment of the business is seen as offering great
potential to utilize the established business strengths of the company in
procuring and processing bait products, and in making the products available
through distribution to convenient outlets.
As a long term strategy, the company will entertain strategic mergers and
acquisitions of both processing and sales entities, which would increase market
share, improve profit margins, and facilitate unified marketing efforts that
create brand identification.
PRODUCTS AND SERVICES
The company's core operations involve the utilization of state-of-the-art
equipment for IQF freezing, processing, and packaging of frozen shrimp and
seafood. The products are distributed to many of the nation's largest seafood
restaurant chains and retail grocery outlets. This business is conducted through
the Custom Pack subsidiary.
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The seafood products and packaging are well developed. Frozen, headless
shrimp (with shell on) is the principal product processed, which is frequently
packaged in consumer friendly, one pound and two pound packages. Peeled shrimp
is also processed under private labels for customers or for distribution to
restaurants. Frozen fish fillets are packaged for distribution, as well.
In 1997 the company acquired CoMar Foods, which produces breaded and
stuffed shrimp, stuffed lobster, cooked shrimp rings (with cocktail sauce) and
other value-added, ready-to-cook, ready-to-eat seafood products. The operations
of CoMar Foods are in the process of being consolidated into Custom Pack during
the March 31, 2000 fiscal year.
The company's Aquaculture subsidiary is engaged in the development of farm
grown seafood, principally freshwater prawns, at its facility in Ocean Springs,
MS, which was acquired in 1997. The facility hatches and nurses shrimp larvae
for stocking in ponds operated by independent growers in Mississippi.
In 1998 the principals of the company developed a full line of branded
frozen bait products for recreational fishermen. These products include
varieties of bait shrimp, catfish bait, eels, cut squid, cigar minnows,
ballyhoo, frozen chum, and menhaden oil. In April, 1999 this activity was
incorporated as a wholly-owned subsidiary, Killer Bee, Inc., and was
consolidated into the company. The products are packaged in the Custom Pack
facility and in contracted independent facilities in Pascagoula, MS. The "Killer
Bee Bait" name is a registered trade name, and the products are sold through Wal
Mart, K Mart, and independent marinas and bait stores.
MARKETING
All of the company's sales were to the United States for the last three
fiscal years. Foreign or export sales are not expected to be a material factor
in future revenues.
CUSTOMER SUPPORT
For fiscal years ended March 31, 1996 and 1997, one customer, Ocean To
Ocean Seafood Sales, generated 85% of total revenues for each year. For the
fiscal years ended March 31, 1998 and 1999, the sales to two customers, Ocean To
Ocean Seafood Sales and Seacoast Foods, amounted to 47% and 95% in the
respective years. In the opinion of management, the loss of these customers
would have a material, short-term impact on the company, but this business could
be generated from other sources, if necessary.
SUPPLIERS
Seafood products are readily available in the domestic and international
markets. company operations rely on outside sources for seafood product. Current
product is usually purchased at the dock source or trucked in for processing.
Buying agents are employed in the States along the South Atlantic Coast and Gulf
of Mexico from North Carolina to Texas. The company also imports seafood from
Asia and Central and South America. The aquaculture subsidiary does not supply a
material amount of product to the company, but it is the company's intention to
develop this business as a consistent source of supply for the future.
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In fiscal year ending March 31, 1996 no supplier accounted for more than
10% of purchases. In fiscal years ending March 31, 1997 , March 31, 1998, and
March 31, 1999 three suppliers accounted for a total of 43%, 56%, and 49% of
purchases, respectively. In the opinion of management, the loss of these
suppliers would have a material, short-term impact on the company, but the
purchases could be generated from other sources, if necessary.
The company utilizes many of the supply sources for its seafood products to
supply the "Killer Bee Bait" line of bait products. Because of its established
sources of supply for seafood products and the relative volume of existing
business, the company believes that it is in a position to acquire abundant
supplies of recreational fishing bait products to support this line of business.
PROPRIETARY RIGHTS
The company has acquired a federally-registered service mark for the
"Killer Bee Bait" name and for its bait products. In addition, the company
relies upon common law rights to establish and protect its intellectual
property. There can be no assurance that the company's measures to protect its
intellectual property will deter or prevent the unauthorized use of the
company's intellectual property. If the company is unable to protect its
intellectual property rights, including existing trademarks and service marks,
it could have a material adverse effect upon the company's results of
operations.
REGULATION
The terms and conditions under which the company prepares, packs and
distributes its seafood products are subject to government regulation. Federal
laws and FTC regulations apply to interstate distribution of frozen seafood
products, while particular state regulatory authorities have jurisdiction over
seafood distribution and sale within their borders.
EMPLOYEES
As of October 31, 1999 there were approximately 120 persons employed by the
company. This number does not include its independent commission salesmen, who
are classified by the company as independent contractors rather than employees.
The company's employees are not unionized, and the company believes that its
relationship with its employees is good.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION
The following information has been derived from the financial statements of
the company. Such information should be read in conjunction with the audited
financial statements of the company for the years ended March 31, 1999 and 1998
and the six months ended September 30, 1999, appearing elsewhere in this
Registration Statement. Information as of and for the six months ended September
30, 1999 is unaudited, but reflects, in the opinion of
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management, all adjustments (which include only normal recurring accruals)
necessary to present fairly the financial information for such period.
SELECTED FINANCIAL DATA
(Dollars in thousands, except per share data)
AS OF AND FOR THE YEARS ENDED MARCH 31
Audited Percentage Audited Percentage
3/31/99 of Net Sales 3/31/98 of Net Sales
INCOME STATEMENT
REVENUE: $ 13,841 100.00 $ 14,055 100.00
COST OF SALES: $ 10,214 73.80 $ 11,169 79.47
GROSS MARGIN: $ 3,627 26.20 $ 2,886 20.53
OPER. EXPENSES $ 3,544 25.61 $ 2,699 19.20
INCOME BEFORE
OTHER ITEMS $ 82 0.59 $ 187 1.33
OTHER INC (EXP) $ (44) (0.32) $ 32 0.23
NET INCOME
BEFORE TAX $ 38 0.27 $ 219 1.56
PROVISION FOR
INCOME TAX $ 9 0.07 $ 87 0.62
-------- ------- -------- -------
NET INCOME $ 29 0.21 $ 131 0.94
NET INCOME (LOSS)
PER SHARE (1) $ 0.00 $ 0.01
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AS OF AND FOR THE SIX MONTHS ENDED SEPTEMBER 30
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Unaudited Percentage Unaudited Percentage
9/30/99 of Net Sales 9/30/98 of Net Sales
INCOME STATEMENT
REVENUE: $ 7,546 100.00 $ 6,349 100.00
COST OF SALES: $ 4,753 62.99 $ 4,145 65.28
GROSS MARGIN: $ 2,793 37.01 $ 2,204 34.72
OPER. EXPENSES $ 2,845 37.70 $ 1,991 31.37
INCOME BEFORE
OTHER ITEMS $ (52) (0.68) $ 213 3.35
OTHER INC (EXP) $ (39) (0.52) $ (3) 0.04
NET INCOME
BEFORE TAX $ (91) (1.20) $ 210 3.31
PROVISION FOR
INCOME TAX $ 1 0.01 $ 0 0.00
------- ------- ------- -------
NET INCOME $ (91) (1.21) $ 210 3.31
NET INCOME (LOSS)
PER SHARE (1) $ (0.01) $ 0.02
Audited Audited Unaudited Unaudited
3/31/99 3/31/98 9/30/99 9/30/98
BALANCE SHEET:
TOTAL ASSETS: $4,282 $3,178 $6,847 $4,538
LONG-TERM
OBLIGATIONS: (2) $1,653 $1,126 $1,694 $1,720
(1) Net Income (Loss) from continuing operations per share includes the
weighted average number of shares of the company's common capital
outstanding
(2) Long-term Obligations includes the current portion of long-term debt and
capital leases.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion is provided to afford the reader an understanding
of the major elements of the company's financial condition, results of
operation, capital resources and liquidity. It should be read in conjunction
with the financial statements and notes thereto and other information appearing
elsewhere in this Registration Statement.
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OVERVIEW
The core seafood packaging business of the company does not require
significant inventory requirements, as products are either sold immediately from
processing or are packaged for third-party accounts. However, subsequent to
March 31, 1999, the company acquired Killer Bee, Inc. and began packaging and
distributing frozen bait products for the recreational fishing industry. The
recreational bait products require that the company acquire, process, and have
available for distribution an adequate supply of product in inventory. As this
segment of business expands, the company's relative levels of inventory will
expand accordingly. The balance sheet as of September 30, 1999 reflects an
increase in inventory from $-0- at March 31, 1999 to $502,125 due to the
operations of Killer Bee.
Subsequent to its fiscal year end, the company entered into several
financial transactions which provided additional liquidity to support the
anticipated growth of inventory and accounts receivable assets (See "Liquidity
and Capital Resources" below).
Net Sales
Net Sales primarily reflects the results of processing and packaging
operations. The amount of revenues recognized in any given year is a function of
whether the products are: a) purchased, processed, and packaged by the company,
or; b) processed and packaged for third parties on a consignment basis. In the
first instance, revenues would be higher, reflecting the cost of the product,
and in the latter case revenues would only reflect a processing charge. Gross
Margins are relatively unaffected by either scenario, but the reported Net Sales
figures can be greatly affected.
Net Sales for the year ended March 31, 1999 declined from the previous year
from $14,054,926 to $13,841,059. However, Gross Margin increased from $2,885,526
to $3,627,002, an increase of 25.7%. This increase in Gross Margin properly
reflects the higher level of production activity in the March 31, 1999 year,
where gross profits were earned from a higher level of products which were
processed on consignment in that year relative to the previous year. The company
attributes the increased production activity to the continued expansion of its
customer base for packaged seafood by its Custom Pack subsidiary.
Net Sales for the six months period ended September 30, 1999 increased
14.7% to $4,753,155 from $4,144,599 in the comparable period ended September 30,
1998. This increase reflects $548,182 in Net Sales from Killer Bee, which
accounts for 90.1% of the growth.
Cost of Sales sets forth the processing and packaging costs, including
plant labor, in-bound and out-bound freight, and the raw material (seafood)
costs where the products are processed for the company's own account. Where
processing is done for a third-party account, the raw material (seafood) costs
are not carried on the company's books. Approximately 20% of Net Sales is
reflected in processing for third parties, where the company charges a
processing fee and does not maintain any inventory level of product for its own
account. The decline in Cost of Sales from $11,169,400 to $10,214,057 (minus
8.6%) reflects the higher level of consignment processing in the March 31, 1999
year. The six months periods ending September 30, 1999 and
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1998 reflects relatively static volumes of third party processing. The increase
in Gross Margins to 37.0% from 34.7% reflects the additional contribution of
Killer Bee products.
Selling, general and administrative expenses increased from $791,944 to
$1,206,928, an increase of 52.4% in the latest fiscal year. CoMar Foods was
acquired in October 1997, and therefore approximately $100,000 of the increase
is a direct result of recognition of a full year's operations of CoMar in the
March 31, 1999 year. The balance of the increase reflects the company's
investment in expanded corporate overhead in anticipation of future revenue
growth from aquaculture and expanded seafood processing. In comparing September
30, 1999 to 1998, the activities of Killer Bee added $319,920 or 91.2% of the
$350,864 increase.
Other Income (Expenses)
The company reported other income of $66,822 and $142,833 in the two fiscal
years ended March 31, 1999 and 1998, respectively. Other income predominantly
reflects lease payments received from rental of company-owned property to the
Casino industry in Biloxi, Mississippi. For the interim periods ending September
30, 1999 and 1998 other income was $23,933 and $36,989, respectively.
Net Income
Net Income from the core business of Custom Pack, Inc. has been used by the
company to offset operating losses from CoMar Foods and the Aquaculture Division
for the fiscal years ending March 31, 1999 and 1998, when net income declined
from $131,393 to $28,600. In the last fiscal year, losses of $227,734 and
$185,340, respectively from those areas, offset $495,400 net profit from Custom
Pack. The company is consolidating the CoMar operations to improve the
performance of that subsidiary, and it views the initial losses in the
Aquaculture Division as an investment in the future for the company. For the
interim six months ending September 30, 1999 the loss in CoMar Foods was reduced
to $105,117 and the Aquaculture Division loss declined to $34,256. Operations of
Killer Bee, also in a beginning phase, contributed $275,328 to the reported
$91,472 net loss for the six months period ending September 30, 1999. These
operating losses offset $343,685 net income from Custom Pack. Killer Bee was not
included in the September 30, 1998 results, and the company expects Killer Bee
to be a net income provider in the near future.
SEASONALITY
Because of the availability of seafood throughout the world markets, there
is only a modest seasonal factor for the company's business. Typically, the
company's operating activities increase slightly during the Spring and Fall
domestic shrimp harvesting seasons, depending on the abundance of the crop which
is found in the wild. The company expects that the operations of Killer Bee will
demonstrate seasonality which reflects the higher recreational fishing
activities in the warmer months of the year.
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INFLATION
The company's business is not significantly affected by inflation. The
company anticipates that any increased costs would be passed on to its
customers.
NEW PRODUCTS AND SERVICES
On April 1, 1999 the company purchased the assets and brand name of Killer
Bee, Inc. Killer Bee packages and distributes over 30 brand name bait products
for recreational fishermen. These products are currently sold along the United
States Gulf Coast and the Atlantic coast from Florida to Virginia through
selected K Mart and Wal Mart stores and independent outlets. The company
believes that these bait products compliment existing seafood operations and
will enhance Net Sales significantly.
On June 25, 1999 the company purchased the assets and brand name of Drag N
Bait, Inc., which is a recognized supplier of ballyhoo to the recreational
fishing market, particularly in Florida. Ballyhoo is considered a premium bait
product. The operations of Drag N Bait after June 25, 1999 have been
consolidated with those of Killer Bee in the six months interim financial
reports.
LIQUIDITY AND CAPITAL RESOURCES
The operations of the company and its subsidiaries have historically been
provided principally from cash flow from operations of Custom Pack. Financing
activities have more recently provided significant capital resources.
Operating Activities
The company's Consolidated Statement of Cash Flows reported $685,572
generated from Operating Activities in the March 31, 1999 fiscal year.
Depreciation provided $350,639 and net changes in working capital accounts
contributed $334,933. For the six months ended September 30, 1999, Operation
Activities used $1,163,233 in funds, primarily in increased Accounts Receivable
($427,346) and increased inventories for Killer Bee ($502,125). Depreciation
provided $205,695 in the latest six month period.
Investing Activities
The company purchased additional property and equipment of $475,333 and
$391,535 in the last fiscal years from March 31, 1999 to 1998, respectively.
Sales of property and equipment generated $31,000 in the latest year only.
Purchases of property and equipment in the September 30, 1999 and 1998 six month
periods were $488,993 and $429,360, respectively.
Financing Activities
Financing activities have become a much more significant source of net cash
for the company and the expansion of the business activities of its
subsidiaries. $2,833,329 was
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provided from this source in the six months ended September 30, 1999, primarily
from additional capital contributed.
Net cash of $463,848 was provided in the 1999 fiscal year from Financing
Activities. $100,000 was provided from sale of additional preferred stock, and
$363,848 was provided from net changes in notes payable and lease obligations.
Subsequently, on April 1, 1999 the company issued 152,564 common shares for
the acquisition of Killer Bee, Inc. assets valued at $238,000. On April 7, 1999
the company issued 114,800 common shares to buy out the balance of $143,500 in
payments due under the outstanding non-compete agreement, and issued 32,000
common shares for services rendered, which had a value of $40,000.
Prior to March 31, 1999 the company issued 1,050,000 shares of common stock
into escrow until $650,000 in cash proceeds was received. A total of $371,100
has been received through October 31, 1999.
During April 1999 the company issued additional preferred stock for
$2,000,000 cash consideration. These funds are designated by the company to
support working capital requirements for the expansion of the Killer Bee bait
products.
Summary Discussion of Liquidity
The net increase in cash from Operating Activities, Investing Activities,
and Financing Activities for the March 31, 1999 fiscal year totaled $705,087.
Subsequent Operating Activities, Investing Activities, and Financing Activities
between March 31 and September 30, 1999 have contributed an additional
$1,218,603 in net cash.
Lines of Credit from banks totaling $1,000,000 are available for normal
business activities.
ITEM 3. PROPERTIES
The seafood processing and packaging business is conducted through the
Custom Pack subsidiary at its plant located at 555 Bayview Avenue, Biloxi, MS.
The plant facility occupies over 50,000 square feet of floor space, including
processing areas, coolers, and freezers and is on 3.7 acres of property.
Certain value-added, ready-to cook, ready-to-eat food items are packaged at
the company-owned CoMar Foods, Inc. plant location at 10200 Cody Driskell Road,
Irvington, AL. There is 12,800 square feet of processing space on 10 acres of
property.
The company's aquaculture business is conducted at its Ocean Springs, MS
facility, which occupies 25 acres, with 10.7 acres developed, and includes three
geothermal water wells.
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YEAR 2000
The company believes that it has addressed potential technological concerns
related to the "Year 2000". The company hired an independent consultant to
evaluate internal computer needs and "Y2K" compliance, and, as a result, the
company has replaced its computer systems and software within the last year.
Additionally, the company has communicated with its major vendors and customers
and has ascertained their respective readiness to address potential "Y2K"
problems. No problems are expected.
Should the company's freezing and storage capacity be affected by
widespread municipal power shortages, the company would have a period of five to
seven days to address such loss of power through alternative means before any
losses would be experienced.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
This table describes the ownership of our outstanding common stock as of
September 30, 1999 by (i) each of our officers and directors; (ii) each person
who is known by us to own more than 5% of the company's outstanding Common
Stock; and (iii) all of our officers and directors as a group:
Name and Address Amount and Nature of Percentage of
Of Beneficial Owner Beneficially Owner Class
------------------- ------------------ -----
Brent Gutierrez 3,217,522(1) 24.05%
555 Bayview Avenue
Biloxi, MS 39530
Clayton Gutierrez 3,217,521(2) 24.05%
555 Bayview Avenue
Biloxi, MS 39530
Frank and Anita Gutierrez 2,666,666 20.71%
JTWROS
555 Bayview Avenue
Biloxi, MS 39530
William Schofield 4,509,804(3) 25.94%
15340 Fiddlesticks Blvd.
Ft. Meyers, FL 33912
Equity Advisors, Inc. 1,000,000(4) 7.77%
14502 N. Dale Mabry Hwy.
Tampa, FL 33618
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All officers and directors
as a group (5 persons) 13,611,513(1)(2)(3) 74.03%
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(1) Includes 500,000 shares which may be obtained by Brent Gutierrez upon the
exercise of warrants owned by Mr. Gutierrez in the like amount.
(2) Includes 500,000 shares which may be obtained by Clayton Gutierrez upon the
exercise of warrants owned by Mr. Gutierrez in the like amount.
(3) Consists of 2,509,804 shares which may be obtained by Mr. Schofield upon
the conversion of preferred shares as of September 30, 1999 and 2,000,000
shares which may be obtained by Mr. Schofield upon the exercise of Warrants
owned by Mr. Schofield in the like amount.
(4) Includes 1,000,000 shares which may be obtained by Equity Advisors, Inc.
upon the exercise of Warrants owned by it in the like amount.
As ownership of shares of the company's common stock by each of the
company's directors and executive officers is included within the foregoing
table, and as the company currently employs no additional executive officers, no
separate table has been provided to identify company stock ownership by
management personnel.
ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS
Years of Service
Name Age Position with Company
- ---- --- -------- -------------
Brent Gutierrez 37 Director, Chief Executive 11
Officer, President, Chief
Financial Officer and
Treasurer
Clayton F. Gutierrez 34 Director, Senior Vice 11
President and Secretary
Frank C. Gutierrez 64 Director 11
Anita K. Gutierrez 57 Director 11
William Schofield 62 Director 6 mos.
Mr. Brent Gutierrez is a founder of the company and has served as its Chairman
of the Board of Directors, Chief Executive Officer and President since its
activation in February 1988 as Custom Pack, Inc. Prior to his involvement with
the company he was attending Mississippi State University.
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Mr. Clayton F. Gutierrez is also a founder of the company and has served as a
member of the Board of Directors and Senior Vice President since 1988. Prior to
his involvement with the company he was attending the University of Southern
Mississippi.
Mr. Frank Gutierrez is a founding Director of the company. Prior to his
involvement he was an owner and manager of Biloxi Freezing Company.
Mrs. Anita Gutierrez is a founding Director of the company. Prior to her
involvement she served as Controller of Biloxi Freezing Company.
Mr. William Schofield was elected to the Board of Directors of the company on
April 12, 1999. For a period in excess of five years Mr. Schofield has been the
Chairman and Chief Executive Officer of Schofield & Associates, an entity
engaged in pet food raw materials brokerage.
The company's Bylaws indicate that the company will hold an annual
shareholder meeting within the third or fourth calendar month following the
conclusion of its preceding fiscal year of operations, the specific date to be
determined by the incumbent directors, at which company directors shall be
elected. Accordingly, the normal term of office of each director is fixed at one
year, commencing on the date of his election at such shareholder meeting and
continuing until his reelection or replacement at the succeeding such meeting.
The company conducted its 1999 annual shareholder meeting during the month of
June 1999.
Each of the company's principal officers is elected by and serves at the
pleasure of the Board of Directors.
ITEM 6. EXECUTIVE COMPENSATION
No Director is specially compensated for the performance of duties in that
capacity or for his/her attendance at Director meetings. Neither the company's
bylaws nor Nevada law requires the Board of Directors to conduct regular
meetings during an operating period. As the company's Directors, in their
separate capacities as the company's operating officers, meet daily to review
company activities, no regular or special meetings of the company's Board of
Directors were called or conducted during 1999, nor within the portion of the
current fiscal year preceding the filing of this Registration Statement. No
Board of Directors Committees operated during 1999 or prior thereto.
The following table sets forth certain information regarding the
compensation paid to each of the company's officers during the calendar years
indicated:
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SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
Long Term Compensation
Annual Compensation Awards Payouts
------------------------------------------------------------------------------------------------
Name and Other Restricted All Other
Principal Compen- Stock Options/ Compen-
Position Year Salary Bonus sation Awards SAR's Payouts sation
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Brent 1998 $104,000 $0 $0 $0 0 $0 $0
Gutierrez 1997 $95,000 $0 $0 $0 0 $0 $0
President, 1996 $78,000 $0 $0 $0 0 $0 $0
CEO & CFO
Clayton 1998 $104,000 $0 $0 $0 0 $0 $0
Gutierrez 1997 $95,000 $0 $0 $0 0 $0 $0
Senior Vice 1996 $78,000 $0 $0 $0 0 $0 $0
President
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
The referenced periodic compensation was set by the company's directors.
The company has no form of employment agreement with either senior officer, nor
any contractual arrangement under which, upon the individual's resignation or
other termination of service, or upon the occurrence of any change in the
control of the company, the individual would receive any special compensation.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Except as set forth below, there have neither occurred within the preceding
three year period, nor are there pending or proposed, any direct or indirect
material transactions between the company and any of its directors, executive
officers or controlling shareholders outside the ordinary course of the
company's business.
On April 1, 1999 the company issued 152,564 shares of its outstanding
common stock to purchase the assets, brand name, and customer lists of Killer
Bee, Inc., a company jointly controlled by Brent Gutierrez and Clayton
Gutierrez. On the same date, the company granted warrants to purchase 1,000,000
shares of common stock (500,000 each) to Brent Gutierrez and Clayton Gutierrez
in connection with such purchase.
During April, 1999 William F. Schofield was elected as a director of the
company, and he purchased 200,000 shares of preferred stock and 2,000,000 common
stock purchase warrants exercisable at the rate of $1.00 per share until July
15, 2001, which was issued by the company for $2,000,000 cash consideration.
The company purchases some of its product from a related company and
derives a portion of its revenues from sales to that related company.
15
<PAGE>
ITEM 8. DESCRIPTION OF SECURITIES
The company's only authorized classes of capital stock consist of:
i) 50,000,000 shares of common stock, par value $.001, of which
12,876,915 shares were issued and outstanding as of September 30, 1999
and 11,678,082 shares as of March 31, 1999; and,
ii) 25,000,000 shares of preferred stock, par value $.001, of which
200,000 shares were issued and outstanding as of September 30, 1999
and 30,000 shares as of March 31, 1999.
VOTING RIGHTS
Each holder of common stock is entitled to cast one vote for each share
held on all issues requiring a shareholder vote, but may not cumulate his, her
or its votes for the election of directors or for any other purpose. The
company's bylaws authorize the holders of 10% or more of the outstanding capital
stock to call a shareholder meeting, and the Nevada General Corporation Act
separately authorizes a state district court to order the conduct of a
shareholder meeting, upon application of any shareholder, when the company has
failed to hold an annual meeting within the 30 day period succeeding occurrence
of the last date designated therefore. To the date of this filing, no such
application has been made.
RESTRICTIONS ON TRANSFERABILITY
As of October 25, 1999 there were 8,574,246 shares of the company's issued
and outstanding shares which are recorded as restricted on the books of the
transfer agent.
DISTRIBUTIONS IN RESPECT OF SHAREHOLDINGS
The company has not declared or paid a dividend on its common shares.
The future dividend or distribution policy of the company will be
determined at the discretion of the Board of Directors, and will depend upon a
number of factors, including future earnings, financial conditions, liquidity
and general business conditions. Each share will participate equally in
dividends or other distributions, which will be payable when and as declared by
the Board of Directors out of funds legally available for that purpose.
LIQUIDATION RIGHTS
In any liquidation of substantially all of the company's assets,
dissolution of its corporate existence or winding up of its operations or
affairs, each holder of one or more common shares of the company's outstanding
capital stock will be entitled to a ratable portion of all assets available for
distribution after the company's payment and satisfaction of all of its debts,
liabilities and preferences.
16
<PAGE>
VOTE REQUIRED TO AMEND
Under the Nevada General Corporation Act, the company's Articles of
Incorporation are subject to amendment at any regular or special meeting of the
shareholders by the affirmative vote of the holders of a majority of the
company's outstanding shares of capital stock, unless the vote of the holders of
a greater number of shares is required by the specific terms of such
Certificate. The company's Articles of Incorporation contains no such
requirement.
PREEMPTIVE RIGHTS
Generally, holders of shares of the company's capital stock do not have any
preemptive or other right to subscribe for additional shares on a pro rata basis
when and if such additional shares are offered for sale.
FULLY PAID AND NON-ASSESSABLE
No share of the company's common stock may be issued before being fully
paid. Consequently, once issued, the holders of such shares may not be subjected
to further assessment by the company for the purpose of restoring impaired
capital or otherwise.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for outstanding shares of the company's
capital stock is: Fidelity Transfer Agency, 1800 South West Temple, Suite 301,
Salt Lake City, UT 84115.
17
<PAGE>
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON
EQUITY AND RELATED STOCKHOLDER MATTERS
As of March 31, 1999, the company reported 11,678,082 outstanding shares of
common stock, $.001 par value. As a result of financing transactions occurring
after the close of the company's fiscal year on March 31, 1999, outstanding
shares of the company's common stock as of the date hereof, increased to
12,876,915 and the number of outstanding preferred shares increased to 200,000.
The company has outstanding 4,500,000 warrants to purchase additional
common shares at prices between $1.00 to $1.56 and expiring on or before July
15, 2001 to April 1, 2009.
Presently, the company's securities are traded Over-the counter under the
symbol "GSFT". Prior to December 22, 1998, the company's securities traded under
the symbol "IPCK". The shares have not been eligible for listing on any
securities exchange or under the NASDAQ system. The company's directors expect
to undertake such actions as may be required as a condition precedent to
achieving such NASDAQ listing.
The following table sets forth the high ask and low bid prices for the
periods indicated:
Quarter ended High Ask Low Bid
------------- -------- -------
September 30, 1999 1 7/8 1 5/16
June 30, 1999 2 1/2 1 1/8
March 31, 1999 2 3/4 1
December 31, 1998 1 5/16 0.61
September 30, 1998 2 1 1/8
June 30, 1998 2 5/8 1 7/16
March 31, 1998 2 11/16 1 7/16
December 31, 1997 3 1/16 1 3/8
There were 285 shareholders of record as of October 25, 1999. There were
1,287 reported beneficial owners of the company's common stock as of November 4,
1999.
The company has not paid cash dividends on its common stock and does not
expect to pay cash dividends on its common stock in the future.
ITEM 2. LEGAL PROCEEDINGS
In the ordinary course of its business, the company is periodically made a
party to routine proceedings or litigation, the expected results of which will
have no material adverse affect upon its financial or operating condition. At
the present time, neither the company nor any of its
18
<PAGE>
directors or executive officers, nor any controlling shareholder, is a party to
any pending legal or administrative proceeding having the potential for any
material affect upon any matter herein discussed, nor are any of the company's
properties the subject of such a proceeding, and no such proceeding is known to
be overtly threatened.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
There have been no changes and disagreements with accountants on accounting
and financial disclosure.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES
On or about June 1, 1997 we issued 300,000 shares to Daniel Jackson, Esq.
in exchange for legal services performed by Mr. Jackson on our behalf. We relied
on the exemption from registration at Section 4(2) of the Securities Act of 1933
for non-public offerings.
On October 1, 1997 we issued an aggregate of 422,492 to shareholders of
CoMar Foods, Inc. These shares were issued in connection with the acquisition by
us of all of the outstanding shares of CoMar. We relied on the exemption from
registration at Section 4(2) of the Securities Act of 1933 for non-public
offerings.
Between January 20, 1998 and May 13, 1998 we issued 30,000 shares of
preferred stock to three individuals for an aggregate of $300,000. We relied on
the exemption from registration at Section 4(2) of the Securities Act of 1933
for non-public offerings. On June 14, 1999 all 30,000 shares of preferred stock
were converted into an aggregate of 300,000 shares of our Common Stock.
On November 1, 1998 we issued 1,000,00 common stock purchase warrants to
Equity Advisors, Inc. exercisable at the rate of $1.00 per share. The Warrants
are exercisable until July 1, 2008. We relied on the exemption from registration
at Section 4(2) of the Securities Act of 1933 for non-public offerings.
On March 5, 1999 we issued 50,000 shares of our common stock to the I.R.
Firm, Inc. in exchange for financial public relations services. We relied on the
exemption from registration under Regulation D, Rule 504 of the Securities Act
of 1933.
On March 5, 1999 we issued 1,050,000 shares to four investors to be held in
escrow until cash proceeds of $650,000 was received by the company. As of the
date hereof, we received $477,600 and an aggregate of 771,508 shares were
delivered to the investors. We intend on canceling the balance of the
subscriptions and returning 278,492 shares to our treasury. The offering was
conducted under Regulation D, Rule 504 of the Securities Act of 1933.
On April 1, 1999 we issued an aggregate of 152,564 shares and an aggregate
of 1,500,000 common stock purchase warrants exercisable at the rate of $1.56 to
Brent Gutierrez
19
<PAGE>
(50,855 shares and 500,000 warrants), Clayton Gutierrez (50,855 shares and
500,000 warrants) and Larry Gollott (50,854 shares and 500,000 warrants) in
connection with the purchase of the assets, brand name and customer lists of
Killer Bee, Inc. Mr. Brent Gutierrez is the company's CEO, President, CFO,
Treasurer and a Director. Mr. Clayton Gutierrez is the company's Senior Vice
President, Secretary and a Director. We relied on the exemption from
registration at Section 4(2) of the Securities Act of 1933 for non-public
offerings.
On April 7, 1999 we issued 114,800 shares of the company's common stock to
Henry Gutierrez in lieu of future payments of $143,500 which were due under a
certain non-compete agreement between the company and Mr. Gutierrez. We relied
on the exemption from registration at Section 4(2) of the Securities Act of 1933
for non-public offerings.
On June 23, 1999 we issued 32,000 shares of the company's common stock to
Finch Enterprises, LLC in lieu of consulting services valued at $40,000. We
relied on the exemption from registration at Section 4(2) of the Securities Act
of 1933 for non-public offerings.
During April 1999 we issued 200,000 shares of preferred stock valued at
$10.00 per share an 2,000,000 Warrants exercisable at the rate of $1.00 per
share, expiring on July 15, 2001 for $2,000,000 in cash to William Schofield, a
Director of the company. We relied on the exemption from registration at Section
4(2) of the Securities Act of 1933 for non-public offerings.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Nevada General Corporation Act (the "Nevada Act") provides that each
existing or former director and officer of a corporation may be indemnified in
certain instances against certain liabilities which he or she may incur,
inclusive of fees, costs and other expenses incurred in connection with such
defense, by virtue of his or her relationship with the corporation, or with
another entity to the extent that such latter relationship shall have been
undertaken at the request of the corporation; and may have advanced such
expenses incurred in defending against such liabilities upon undertaking to
repay the same in the event an ultimate determination is made denying
entitlement to indemnification. The company's bylaws incorporate the statutory
form of indemnification by specific reference. The company has never acquired or
applied for any policy of directors' and officers' liability insurance as a
means of offsetting its obligation for indemnity.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements of the company, which are furnished herein as of
March 31, 1999 and 1998, have been audited by Jones, Jensen & company,
independent auditors, as described in its reports with respect thereto. The
accompanying financial reports for the six months reporting period as of and
ending September 30, 1999 and 1998 are unaudited. In the opinion of management,
the amounts reflected in the interim reports include all adjustments, which are
consist of normal recurring adjustments, necessary for a fair presentation of
the results of operations presented for the period.
20
<PAGE>
The following list sets forth a brief description of each of the company's
financial statements and exhibits being filed as a part of this Registration
Statement, as well as the page number on which each statement or exhibit
commences:
Financial Statements
Audited Fiscal Year End March 31, 1999 and 1998
1. Index to Financial Statements F-2
2. Independent Auditor's Report F-3
3. Balance Sheets, March 31, 1999 and 1998 F-4-5
4. Consolidated Statements of Operations for each of
the years ended March 31, 1999 and 1998 F-6
5. Consolidated Statements of Shareholder's Equity
since March 31, 1996 F-7
6. Consolidated Statements of Cash Flows for each of
the years ended March 31, 1999, 1998, and 1997 F-8-9
7. Notes to Financial Statements F-10-21
Unaudited Financial Statements for six months ended September 30, 1999 and 1998
8. Company cover letter of November 15, 1999 F-22
9. Index to financial Statements F-23
10. Balance Sheets, September 30, 1999 and 1998 F-24-25
11. Consolidated Statements of Operations for each of
the six months ended September 30, 1999 and 1998 F-26
12. Consolidated Statements of Shareholder's Equity
since March 31, 1999 F-27
13. Consolidated Statements of Cash Flows for each of
the six months ended September 30, 1999, and 1998 F-28
14. Notes to Financial Statements F-29-39
21
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Consolidated Financial Statements
March 31, 1999 and 1998
<PAGE>
CONTENTS
Independent Auditor's Report ................................................ 3
Consolidated Balance Sheets ................................................. 4
Consolidated Statements of Operations ....................................... 6
Consolidated Statements of Stockholders' Equity ............................. 7
Consolidated Statements of Cash Flows ....................................... 8
Notes to the Consolidated Financial Statements .............................. 10
<PAGE>
[JONES, JENSEN & COMPANY LETTERHEAD]
INDEPENDENT AUDITORS' REPORT
Board of Directors
Global Seafood Technologies, Inc.
(Formerly International Custom Pack, Inc.)
Biloxi, Mississippi
We have audited the accompanying consolidated balance sheets of Global Seafood
Technologies, Inc. (formerly International Custom Pack, Inc.) as of March 31,
1999 and 1998 and the related consolidated statements of operations,
stockholders' equity and cash flows for the years ended March 31, 1999, 1998 and
1997. 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 audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our 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 consolidated financial position of Global
Seafood Technologies, Inc. (formerly International Custom Pack, Inc.) as of
March 31, 1999 and 1998 and the results of their operations and their cash flows
for the years ended March 31, 1999, 1998 and 1997, in conformity with generally
accepted accounting principles.
[Signature]
Jones, Jensen, & Company
Salt Lake City, Utah
June 25, 1999
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Consolidated Balance Sheets
ASSETS
<TABLE>
<CAPTION>
March 31,
-------------------------
1999 1998
---------- ----------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents (Note 1) $ 743,718 $ 38,631
Accounts receivable - net (Note 1) 477,247 388,055
Accounts receivable, related parties - net (Note 1) 153,771 46,139
Prepaid income taxes (Note 8) 46,111 38,572
Prepaid expenses 50,000 6,045
Inventories (Note 1) -- 153,655
Deferred tax asset, current (Note 8) 2,300 --
---------- ----------
Total Current Assets 1,473,147 671,097
---------- ----------
PROPERTY AND EQUIPMENT - NET (Notes 1 and 2) 2,785,230 2,503,885
---------- ----------
OTHER ASSETS
Deferred tax asset (Note 8) 12,300 --
Deposits 11,144 3,089
---------- ----------
Total Other Assets 23,444 3,089
---------- ----------
TOTAL ASSETS $4,281,821 $3,178,071
========== ==========
The accompanying notes are an integral part of these consolidated financial statements
</TABLE>
4
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Consolidated Balance Sheets (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
March 31,
-------------------------
1999 1998
---------- ----------
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable - trade $ 689,875 $ 336,637
Accounts payable - related party (Note 1) 71,583 980
Accrued expenses 27,185 35,823
Income taxes payable (Note 8) 918 17,144
Notes payable, current portion (Note 3) 140,051 556,702
Notes payable to related parties (Note 4) 113,500 114,211
Obligations under capital leases, current portion (Note 6) 93,581 138,012
---------- ----------
Total Current Liabilities 1,136,693 1,199,509
---------- ----------
LONG-TERM LIABILITIES
Notes payable (Note 3) 1,337,806 349,883
Obligations under capital leases (Note 6) 81,501 81,458
---------- ----------
Total Long-Term Liabilities 1,419,307 431,341
---------- ----------
Total Liabilities 2,556,000 1,630,850
---------- ----------
COMMITMENTS AND CONTINGENCIES (Note 9)
STOCKHOLDERS' EQUITY
Preferred stock: 25,000,000 shares authorized
of $0.001 par value, 30,000 and 20,000 shares
issued and outstanding, respectively 30 20
Common stock: 50,000,000 shares authorized
of $0.001 par value, 11,678,082 and 11,628,082
shares issued and outstanding, respectively 11,678 11,628
Additional paid-in capital 1,289,316 1,139,376
Retained earnings 424,797 396,197
---------- ----------
Total Stockholders' Equity 1,725,821 1,547,221
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $4,281,821 $3,178,071
========== ==========
The accompanying notes are an integral part of these consolidated financial statements
</TABLE>
5
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Consolidated Statements of Operations
<TABLE>
<CAPTION>
For the Years Ended March 31,
------------------------------------------------
1999 1998 1997
------------ ------------ ------------
<S> <C> <C> <C>
NET SALES $ 13,841,059 $ 14,054,926 $ 15,909,617
COST OF SALES 10,214,057 11,169,400 13,371,954
------------ ------------ ------------
GROSS MARGIN 3,627,002 2,885,526 2,537,663
------------ ------------ ------------
EXPENSES
Salaries, wages and commissions 1,954,309 1,612,521 1,553,951
Non-complete covenant 32,800 32,800 32,800
Depreciation expense 350,639 258,465 221,204
Bad debt expense -- 3,288 --
Selling, general and administrative 1,206,928 791,944 423,836
------------ ------------ ------------
Total Expenses 3,544,676 2,699,018 2,231,791
------------ ------------ ------------
INCOME BEFORE OTHER
INCOME (EXPENSES) 82,326 186,508 305,872
------------ ------------ ------------
OTHER INCOME (EXPENSES)
Other income 66,822 142,833 77,841
Interest income 5,482 1,800 1,135
Gain on disposition of assets 25,326 -- --
Interest expense (141,740) (112,421) (101,591)
------------ ------------ ------------
Total Other Income (Expenses) (44,110) 32,212 (22,615)
------------ ------------ ------------
NET INCOME BEFORE
INCOME TAXES 38,216 218,720 283,257
PROVISION FOR INCOME
TAXES (Note 8) 9,616 87,327 105,506
------------ ------------ ------------
NET INCOME $ 28,600 $ 131,393 $ 177,751
============ ============ ============
BASIC EARNINGS PER SHARE $ 0.00 $ 0.01 $ 0.02
============ ============ ============
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 11,628,082 11,414,278 10,905,590
============ ============ ============
FULLY DILUTED EARNINGS
PER SHARE $ 0.00 $ 0.01 $ 0.02
============ ============ ============
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 11,824,148 11,458,113 10,905,590
============ ============ ============
The accompanying notes are an integral part of these consolidated financial statements
</TABLE>
6
<PAGE>
<TABLE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Consolidated Statements of Stockholders' Equity
<CAPTION>
Preferred Stock Common Stock Additional
---------------------- ------------------------- Paid-in Retained
Shares Amount Shares Amount Capital Earnings
------ ----------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Balance, March 31, 1996 -- $ -- 10,905,590 $ 10,906 $ 4,252 $ 87,053
Additional capital contributed -- -- -- -- 2,159 --
Net income for the year ended
March 31, 1997 -- -- -- -- -- 177,751
------ ----------- ---------- ----------- ----------- -----------
Balance, March 31, 1997 -- -- 10,905,590 10,906 6,411 264,804
Common stock issued in
connection with the original
acquisition of Enviro Solutions
International, Inc. -- -- 300,000 300 (300) --
Common stock issued
to purchase CoMar Foods, Inc.
on October 1, 1997 -- -- 422,492 422 933,285 --
Preferred stock issued for cash
during 1997 20,000 20 -- -- 199,980 --
Net income for the year ended
March 31, 1998 -- -- -- -- -- 131,393
------ ----------- ---------- ----------- ----------- -----------
Balance, March 31, 1998 20,000 20 11,628,082 1,628 1,139,376 396,197
Preferred stock issued for
cash during 1998 10,000 10 -- -- 99,990 --
Common stock issued for
prepaid consulting services
on March 31, 1999 -- -- 50,000 50 49,950 --
Net income for the year ended
March 31, 1999 -- -- -- -- -- 28,600
------ ----------- ---------- ----------- ----------- -----------
Balance, March 31, 1999 30,000 $ 30 11,678,082 $ 11,678 $ 1,289,316 $ 424,797
====== =========== ========== =========== =========== ===========
The accompanying notes are an integral part of these consolidated financial statements
</TABLE>
7
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
For the Years Ended March 31,
-----------------------------------------
1999 1998 1997
----------- ----------- -----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 28,600 $ 131,393 $ 177,751
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Depreciation 350,639 258,465 221,204
(Gain) loss on sale of assets (25,326) -- 2,517
Bad debts -- 3,288 --
Changes in Assets and Liabilities:
(Increase) decrease in accounts receivable
and accounts receivable - related (196,824) (141,581) (31,335)
(Increase) decrease in taxes receivable (7,539) (38,572) --
(Increase) decrease in deferred tax asset (14,600) 16,075 5,167
(Increase) decrease in inventories 153,655 (46,724) (25,958)
(Increase) decrease in prepaid expenses 6,045 15,690 (21,735)
(Increase) decrease in deposits (8,055) (3,089) 45,000
Increase (decrease) in accounts payable
and accounts payable - related 423,841 157,099 (33,293)
Increase (decrease) in taxes payable (16,226) (73,583) 68,027
Increase (decrease) in accrued expenses (8,638) 14,505 (3,083)
----------- ----------- -----------
Net Cash Provided by Operating Activities 685,572 292,966 404,262
----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Sale of property and equipment 31,000 -- --
Purchase of property and equipment (475,333) (391,535) (117,415)
----------- ----------- -----------
Net Cash Used in Investing Activities (444,333) (391,535) (117,415)
----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Additional capital contributed -- -- 2,159
Proceeds from sale of preferred stock 100,000 200,000 --
Payments on notes payable and leases payable (956,152) (280,539) (247,721)
Proceeds of notes payable and leases payable 1,320,000 -- 62,631
----------- ----------- -----------
Net Cash Provided (Used by)
Financing Activities 463,848 (80,539) (182,931)
----------- ----------- -----------
NET INCREASE (DECREASE) IN CASH 705,087 (179,108) 103,916
CASH AND CASH EQUIVALENTS AT
BEGINNING OF YEAR 38,631 217,739 113,823
----------- ----------- -----------
CASH AND CASH EQUIVALENTS AT
END OF YEAR $ 743,718 $ 38,631 $ 217,739
=========== =========== ===========
The accompanying notes are an integral part of these consolidated financial statements
</TABLE>
8
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Consolidated Statements of Cash Flows (Continued)
For the Years Ended March 31,
------------------------------
1999 1998 1997
-------- -------- --------
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for:
Interest $141,740 $112,421 $103,402
Income taxes $ 27,126 $183,407 $ 37,479
NON CASH FINANCING ACTIVITIES
Property and equipment purchased under
capital leases $118,860 $ 21,905 $ --
Property and equipment acquired by assuming
notes payable $ -- $200,000 $ --
Common stock issued for the purchase of
CoMar Foods, Inc. $ -- $933,707 $ --
The accompanying notes are an integral part
of these consolidated financial statements
9
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
The consolidated financial statements include those of Global Seafood
Technologies, Inc. (formerly International Custom Pack, Inc.) (ICP) and
its wholly-owned subsidiaries, Custom Pack, Inc. and CoMar Foods, Inc.
Custom Pack, Inc. has a separate division that is accounted for as the
"Aguaculture Division" in the consolidated financial statements,
although it is not a separate subsidiary. Collectively, they are
referred to herein as "the Company".
Global Seafood Technologies, Inc. (GST) was incorporated under the laws
of the State of Nevada on May 29, 1986 under the name of Rue de Rivoli
Perfumeries of America, Ltd. It later changed its name to Enviro
Solutions International, Inc. on November 21, 1994 in contemplation of
a merger with Enviro Solutions International, Inc. of Utah. The merger
was never completed. However, the name was still changed.
On October 31, 1995, the Company completed an Agreement and Plan of
Reorganization whereby GST issued 8,000,000 shares of its common stock
in exchange for all of the outstanding common stock of Custom Pack,
Inc. (Custom). Pursuant to the reorganization, the name was changed to
International Custom Pack, Inc. The Company later changed its name to
Global Seafood Technologies, Inc. during 1998.
The reorganization was accounted for as a recapitalization of Custom
because the shareholders of Custom control the Company after the
acquisition. Therefore, Custom is treated as the acquiring entity.
Accordingly, there was no adjustment to the carrying value of the
assets or liabilities of GST. GST is the acquiring entity for legal
purposes and Custom is the surviving entity for accounting purposes.
On October 1, 1997, the Company completed an Agreement and Plan of
Reorganization whereby GST issued 422,492 shares of its common stock
and $300,000 of cash in exchange for all of the outstanding common
stock of CoMar Foods, Inc. (CoMar). The acquisition has been accounted
for as a purchase.
GST was incorporated for the purpose of creating a vehicle to obtain
capital to seek out, investigate and acquire interests in products and
businesses which may have a potential for profit.
Custom, a wholly-owned subsidiary, was incorporated under the laws of
the State of Mississippi on February 15, 1988. It was incorporated for
the purpose of being a full service processor, packager, and storage
provider of shrimp and other seafood.
CoMar, a wholly-owned subsidiary, was incorporated under the laws of
the State of Alabama on February 26, 1993. It was incorporated for the
purpose of being a full service processor and packager of shrimp and
other seafood products.
b. Accounting Method
The Company's consolidated financial statements are prepared using the
accrual method of accounting. The Company has elected a March 31 year
end.
10
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
c. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with
maturities of three months or less at the time of acquisition. The
Company's cash accounts at its banks are insured by the FDIC up to
$100,000. The amount in excess of the insured limits at March 31, 1999
was $639,845.
d. Basic and Fully Diluted Earnings Per Share
The computations of basic earnings per share of common stock are based
on the weighted average number of shares outstanding during the period
of the consolidated financial statements. Common stock equivalents,
consisting of the preferred shares, have been included in the fully
diluted earnings per share.
e. Principles of Consolidation
The consolidated financial statements include those of Global Seafood
Technologies, Inc. and its wholly-owned subsidiaries, Custom Pack, Inc.
and CoMar Foods, Inc. All significant intercompany accounts and
transactions have been eliminated.
f. Inventories
Inventory supplies are stated at the lower of cost (computed on a
first-in, first-out basis) or market. The inventory consists of
seafood, seafood storage bags, packing boxes and other miscellaneous
packaging materials.
g. Property and Equipment
Property and equipment are stated at cost. Expenditures for small
tools, ordinary maintenance and repairs are charged to operations as
incurred. Major additions and improvements are capitalized.
Depreciation is computed using the straight-line and accelerated
methods over estimated useful lives as follows:
Machinery and equipment 5 to 7 years
Furniture and fixtures 5 to 7 years
Buildings 3 to 7 years
Vehicles 5 years
Water well 7 years
h. Accounts Receivable
Accounts receivable are recorded net of the allowance for doubtful
accounts of $5,886 and $5,886 for the years ended March 31, 1999 and
1998, respectively.
i. Related Party Transactions
The Company purchases some of its product and supplies from a related
company. The amounts owed to this Company at March 31, 1999 and 1998
was $71,583 and $980, respectively.
The Company also sells some of its product to the same related company.
The amounts owed from this company at March 31, 1999 and 1998 was
$153,771 and $46,139, respectively.
11
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
j. Revenue Recognition
Revenue is recognized upon shipment of goods to the customer.
k. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
l. Reclassifications
Certain prior period amounts have been reclassified to conform to the
March 31, 1999 financial statement presentation.
m. Advertising
The Company follows the policy of charging the costs of advertising to
expense as incurred.
n. Change in Accounting Principle
The Company adopted Statement of Financial Accounting Standards (SFAS)
No. 128, "Earnings Per Share" during the year ended March 31, 1999. In
accordance with SFAS No. 128, diluted earnings per share must be
calculated when an entity has convertible securities, warrants,
options, and other securities that represent potential common shares.
The purpose of calculating diluted earnings (loss) per share is to show
(on a pro forma basis) per share earnings or losses assuming the
exercise or conversion of all securities that are exercisable or
convertible into common stock and that would either dilute or not
affect basis EPS. As permitted by SFAS No. 128, the Company has
retroactively applied the provisions of this new standard by showing
the fully diluted earnings per common share for all years presented.
12
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly Global Seafood Technologies, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 2 - PROPERTY AND EQUIPMENT
Property and equipment at March 31, 1999 and 1998 consisted of the
following:
March 31,
--------------------------------
1999 1998
----------- -----------
Land $ 102,926 $ 102,926
Buildings and improvements 2,057,887 1,950,207
Furniture and fixtures 26,780 26,780
Machinery and equipment 2,618,001 2,129,745
Vehicles 27,820 27,820
Water well 121,441 121,441
----------- -----------
Total 4,954,855 4,358,919
Less accumulated depreciation (2,169,625) (1,855,034)
----------- -----------
Property and equipment - net $ 2,785,230 $ 2,503,885
=========== ============
Depreciation expense for the years ended March 31, 1999, 1998 and 1997
was $350,639, $258,465 and $221,204, respectively.
NOTE 3 - NOTES PAYABLE
Notes payable at March 31, 1999 and 1998 consisted of the following:
<TABLE>
<CAPTION>
March 31,
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Note payable to a bank, secured by property and equipment,
interest at 8.25%, interest and principal payments of $8,530 due
monthly, matured on March 5, 1998. $ -- $ 307,278
Line of credit with a bank, maximum balance of $200,000, secured
by property and equipment, interest at the bank's prime rate
(8.5% as of March 31, 1998), interest payments due monthly,
principal amount due March 10, 1998. -- 172,530
Note payable, secured by property, interest at 9.0%,
interest and principal payments of $1,497 due monthly,
matures on July 1, 2012. 141,435 143,974
Note payable, secured by property, interest at 8.0%,
interest and principal payments of $702 due monthly,
matures on November 23, 2003. 32,413 37,999
Note payable, secured by property, interest at 12.0%,
interest and principal payments of $3,337 due monthly,
matured on November 1, 2002. -- 140,631
---------- ----------
Balance forward $ 173,848 $ 802,412
========== ==========
</TABLE>
13
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly Global Seafood Technologies, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 3 - NOTES PAYABLE (Continued)
<TABLE>
<CAPTION>
March 31,
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Balance forward $ 173,848 $ 802,412
Note payable, secured by property, interest at 14.5%,
interest and principal payments of $4,136 due monthly,
matured on August 15, 2000. -- 99,348
Note payable, secured by property, interest at 8.05%,
interest and principal payments of $16,124 due monthly,
matures on July 5, 2003. 1,260,603 --
Note payable, secured by property, interest at 7.5%,
interest and principal payments of $399 due monthly,
matures on November 15, 2002. 15,285 --
Note payable, secured by property, interest at 7.5%,
interest and principal payments of $737 due monthly,
matures on October 15, 2002. 27,000 --
Note payable, secured by property, interest at 15.77%,
interest and principal payments of $47 due monthly,
matures December 16, 2001. 493 1,060
Note payable, secured by property, interest at 11.09%,
interest and principal payments of $628 due monthly,
matures during April 1999. 628 3,765
---------- ----------
Total notes payable 1,477,857 906,585
Less: current portion (140,051) (556,702)
---------- ---------
Long-term notes payable $1,337,806 $ 349,883
========== ==========
</TABLE>
Maturities of long-term debt are as follows:
Year Ending
March 31, Amount
------------ ----------
2000 $ 140,051
2001 152,359
2002 166,884
2003 184,354
2004 834,209
2005 and thereafter -
----------
Total $1,477,857
==========
14
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 4 - NOTES PAYABLE - RELATED PARTIES
Notes payable to related parties at March 31, 1999 and 1998 consisted
of the following:
<TABLE>
<CAPTION>
March 31,
------------------------
1999 1998
---------- ----------
<S> <C> <C>
Note payable to a related individual, unsecured, interest
at 10%, interest and principal payments of $200 due
quarterly, matured on March 31, 1999. $ -- $ 711
Note payable to shareholder, unsecured, interest at 10%,
interest payments due quarterly and annually, principal
amount is due on demand. 113,500 113,500
---------- ----------
Total notes payable - related parties $ 113,500 $ 114,211
========== ==========
</TABLE>
NOTE 5 - LINE OF CREDIT
The Company has a line of credit with a bank. The loan is secured,
accrues interest at 7.5% per annum, and has a maximum balance of
$500,000. The balance outstanding on the line of credit at March 31,
1999 was $-0-.
NOTE 6 - CAPITAL LEASES
The Company leases certain equipment with lease terms ending in October
1999 through September 2003. Obligations under these capital leases
have been recorded in the accompanying consolidated financial
statements at the present value of future minimum lease payments. The
capitalized cost of $945,388 less accumulated depreciation of $705,621
is included in property and equipment in the accompanying consolidated
financial statements at March 31, 1999.
Obligations under capital leases at March 31, 1999 and 1998 consisted
of the following:
March 31,
---------------------
1999 1998
-------- ---------
Total $175,082 $ 219,470
Less: current portion (93,581) (138,012)
-------- ---------
Long-term portion $ 81,501 $ 81,458
======== =========
15
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 6 - CAPITAL LEASES (Continued)
The future minimum lease payments under these capital leases and the
net present value of the future minimum lease payments are as follows:
Year Ending
March 31, Amount
----------- ------------
2000 $ 106,242
2001 34,710
2002 19,578
2003 19,578
2004 9,789
2005 and thereafter --
-----------
Total future minimum lease payments 189,897
Less, amount representing interest (14,815)
-----------
Present value of future minimum lease payments $ 175,082
===========
NOTE 7 - MAJOR CUSTOMERS AND SUPPLIERS
For the years ended March 31, 1999 and 1998, two customers generated
sales in excess of 10% of the Company's total sales. Sales to these two
customers made up approximately 95% and 47% of total revenues for the
years ended March 31, 1999 and 1998, respectively.
The Company purchased product from three suppliers during the years
ended March 31, 1999 and 1998 that generated costs in excess of 10% of
the Company's total purchases. Purchases from these three suppliers
combined made up approximately 49% and 56% of total purchases for the
years ended March 31, 1999 and 1998, respectively.
NOTE 8 - INCOME TAXES
Provision for income taxes for the years ended March 31, 1999, 1998 and
1997 consisted of the following: March 31,
1999 1998 1997
--------- -------- ---------
Current:
Federal income taxes $ 19,376 $ 70,670 $ 86,292
State income taxes 4,840 17,144 14,047
Deferred:
Federal income taxes (14,600) (487) 5,167
--------- -------- ---------
Total provision for income taxes $ 9,616 $ 87,327 $ 105,506
========= ======== =========
16
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 8 - INCOME TAXES (Continued)
As of March 31, 1999 and 1998, the Company owed $918 and $17,144 in
state income taxes, respectively.
As of March 31, 1999 and 1998, the Company overpaid its federal income
taxes by $46,111 and $38,572, respectively.
As of March 31, 1999 and 1998, a deferred tax asset of $14,600 and $-0-
was recognized and recorded.
A reconciliation of income taxes at the federal statutory rate to the
effective tax rate is as follows:
1999 1998 1997
--------- -------- ---------
Income taxes computed at the
federal statutory rate $ 24,216 $ 81,079 $ 109,422
Non-deductible allowance for
bad debts (2,300) -- --
Other non-deductible items -- 6,248 11,085
Accelerated depreciation expense (12,300) -- (15,001)
--------- -------- ---------
Income Tax Expense $ 9,616 $ 87,327 $ 105,506
========= ======== =========
NOTE 9 - COMMITMENTS AND CONTINGENCIES
Non-Compete Agreement
The Company entered into a covenant-not-to-compete during the year
ended March 31, 1991. The original agreement required $492,000 to be
paid over 10 years at $49,200 each year. The agreement was amended in
1994 due to an examination by the Internal Revenue Service. The current
agreement calls for annual payments of $32,800. Future minimum payments
are required as follows:
Year Ending
March 31, Amount
----------- ---------
2000 $ 32,800
2001 32,800
2002 32,800
2003 32,800
2004 32,800
2005 10,500
Thereafter --
---------
Total $ 174,500
=========
Subsequent to March 31, 1999, the Company issued 114,800 shares of its
outstanding common stock in lieu of the future payments required under
the non-compete agreement (see Note 13).
17
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 9 - COMMITMENTS AND CONTINGENCIES (Continued)
Common Stock Contingency
The Company is aware of numerous possible claims by individuals that
received either through purchase or otherwise, 850,000 forged shares of
the Company's common stock that purport to represent issued and
outstanding shares. The shares are not listed on the Company's
shareholder records and do not represent duly issued and outstanding
shares of the Company's common stock. Although no litigation is pending
in relation to these shares, it is possible that the Company may have
to honor these 850,000 shares of common stock in the future. The shares
have not been recorded by the Company at March 31, 1999 since the
ultimate outcome is currently not estimatable.
The Company is also in the process of trying to recover 1,700,000
common shares. The holder of the shares is claiming breach of contract
and claims that he is entitled to the shares. The claim is currently in
litigation and management intends on vigorously contesting the claim.
The Company has filed an answer and a counterclaim against the holder
seeking specific performance of a settlement agreement previously
entered into. While the possibility that an unfavorable outcome exists,
the Company has determined that the potential loss is remote and fully
intends on recovering the entire 1,700,000 shares. It is remotely
possible, however, that the Company may have to honor these shares in
the future, although the shares have not been recorded by the Company
as outstanding shares as of March 31, 1999.
Leases
The Company has entered into several non-cancelable leases, accounted
for as operating leases, of certain machinery and equipment used in
operations. The minimum future payments required under the operating
leases are as follows:
Year Ending
March 31, Amount
----------- ---------
2000 $ 152,424
2001 113,204
2002 10,894
2003 10,894
2004 5,147
2005 and thereafter --
---------
Total $ 292,563
=========
NOTE 10 - WARRANTS OUTSTANDING
On November 1, 1998, the Company granted warrants to a consultant to
purchase 1,000,000 shares of common stock at $1.00 per share. The
warrants are exercisable until July 1, 2008.
18
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 11 - CONSOLIDATING STATEMENT OF OPERATIONS
The Company's consolidating statement of operations for the year ended
March 31, 1999 is detailed in the following schedule:
<TABLE>
<CAPTION>
Custom Aquaculture CoMar
Pack, Inc. Division Foods, Inc. Eliminations Totals
----------- ----------- ---------- ------------ -----------
<S> <C> <C> <C> <C> <C>
NET SALES $13,070,875 $ 15,114 $ 826,059 $(70,989) $13,841,059
COST OF SALES 9,915,256 12,532 357,258 (70,989) 10,214,057
----------- --------- ---------- -------- -----------
GROSS MARGIN 3,155,619 2,582 468,801 -- 3,627,002
----------- --------- ---------- -------- -----------
EXPENSES
Salaries, wages and
commissions 1,453,044 68,021 433,244 -- 1,954,309
Non-compete covenant 32,800 -- -- -- 32,800
Depreciation expense 259,426 58,907 32,306 -- 350,639
Selling, general and
administrative 914,949 60,994 230,985 -- 1,206,928
----------- --------- ---------- -------- -----------
Total Expenses 2,660,219 187,922 696,535 -- 3,544,676
----------- --------- ---------- -------- -----------
INCOME (LOSS)
BEFORE OTHER
INCOME (EXPENSES) 495,400 (185,340) (227,734) -- 82,326
----------- --------- ---------- -------- -----------
OTHER INCOME (EXPENSES)
Other income 65,822 -- 1,000 -- 66,822
Interest income 5,482 -- -- -- 5,482
Interest expense (89,814) (9,282) (42,644) -- (141,740)
Gain on disposition
of assets 9,289 -- 16,037 -- 25,326
----------- --------- ---------- -------- -----------
Total Other Income
(Expenses) (9,221) (9,282) (25,607) -- (44,110)
----------- --------- ---------- -------- -----------
NET INCOME (LOSS)
BEFORE INCOME
TAXES 486,179 (194,622) (253,341) -- 38,216
PROVISION FOR
INCOME TAXES 9,616 -- -- -- 9,616
----------- --------- ---------- -------- -----------
NET INCOME (LOSS) $ 476,563 $(194,622) $ (253,341) $ -- $ 28,600
=========== ========= ========== ======== ===========
</TABLE>
19
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 12 - CONSOLIDATED PROFORMA STATEMENT OF OPERATIONS
The historical information contained herein has been consolidated on a
proforma basis and is presented as unaudited. The purchase of assets
and liabilities from CoMar on October 1, 1997 are described in Note 1.
The purchase has been presented in this footnote as though it was
effective April 1, 1997. All significant accounting policies for CoMar
are the same as the Company's as defined in Note 1.
<TABLE>
<CAPTION>
For the Year Ended March 31, 1998
---------------------------------------------------------------------------
International
Custom Custom Pack, CoMar Proforma
Pack, Inc. Inc. Foods, Inc. Eliminations Combined
------------- ------------ ----------- ------------ ------------
(Unaudited)
<S> <C> <C> <C> <C> <C>
NET SALES $ -- $ 13,872,075 $ 746,495 $ (283,979) $ 14,334,591
COST OF SALES -- 11,180,499 505,731 (283,979) 11,402,251
------------ ------------ ----------- ------------ ------------
GROSS MARGIN -- 2,691,576 240,764 -- 2,932,340
------------ ------------ ----------- ------------ ------------
EXPENSES
Salaries, wages and
commissions -- 1,342,677 212,343 -- 1,555,020
Repairs and maintenance -- 181,940 12,090 -- 194,030
Non-compete covenant -- 32,800 -- -- 32,800
Depreciation expense -- 240,832 27,213 -- 268,045
Selling, general and
administrative -- 685,182 229,221 -- 914,403
------------ ------------ ----------- ------------ ------------
Total Expenses -- 2,483,431 480,867 -- 2,964,298
------------ ------------ ----------- ------------ ------------
INCOME (LOSS)
BEFORE OTHER
INCOME (EXPENSES) -- 208,145 (240,103) -- (31,958)
------------ ------------ ----------- ------------ ------------
OTHER INCOME
(EXPENSES)
Other income -- 142,326 1,748 -- 144,074
Interest income -- 1,800 -- -- 1,800
Interest expense -- (97,121) (68,608) -- (165,729)
Bad debt expense -- -- (3,654) -- (3,654)
------------ ------------ ----------- ------------ ------------
Total Other Income
(Expenses) -- 47,005 (70,514) -- (23,509)
------------ ------------ ----------- ------------ ------------
NET INCOME (LOSS)
BEFORE INCOME
TAXES -- 255,150 (310,617) -- (55,467)
PROVISION FOR
INCOME TAXES -- 87,327 -- -- 87,327
------------ ------------ ----------- ------------ ------------
NET INCOME (LOSS) $ -- $ 167,823 $ (310,617) $ -- $ (142,794)
============ ============ =========== ============ ============
</TABLE>
20
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
March 31, 1999 and 1998
NOTE 13 - SUBSEQUENT EVENTS
Subsequent to March 31, 1999, the following significant events
occurred:
1) On April 1, 1999, the Company issued 152,564 shares of its
outstanding common stock to purchase the assets, brand name and
customer lists of Killer Bee, Inc., a Mississippi corporation.
The acquisition will be accounted for as a purchase. On the same
date, the Company granted warrants to purchase a total of
1,500,000 shares of common stock (500,000 each) at $1.56 per
share for a period of 10 years to Brent Gutierrez, Clay Gutierrez
and Larry Gollott, the original owners of Killer Bee, Inc. Brent
Gutierrez and Clay Gutierrez are also current officers and
directors of Global Seafood Technologies, Inc.
2) On April 7, 1999, the Company issued 114,800 shares of its
outstanding common stock in lieu of future payments under the
non-compete agreement (Note 9), in the amount of $143,500.
3) During April 1999, the Company issued to a director 200,000
shares of its outstanding preferred stock valued at $10.00 per
share for $2,000,000 in cash. In connection with the preferred
issuance, the Company also granted warrants to purchase 2,000,000
shares of common stock to the director. The warrants are
exercisable at $1.00 per share until July 15, 2001.
4) Prior to March 31, 1999, the Company issued 1,050,000 shares of
its outstanding common stock to be held in escrow until the cash
proceeds of $650,000 was received. Through the date of our audit
report, a total of $371,100 had been received.
5) On April 7, 1999, the Company authorized the issuance of 32,000
shares of common stock for services rendered valued at $40,000.
6) The 30,000 shares of preferred stock outstanding at March 31,
1999 were converted into 300,000 shares of common stock.
7) On June 25, 1999, the Company entered into an agreement to
purchase the assets, brand name and customer lists of Drag N'
Baits, Inc., a Florida corporation, for a cash price of $339,000.
The acquisition will be accounted for as a purchase.
21
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Consolidated Financial Statements
September 30, 1999 and 1998
CONTENTS
Company Letter ............................................................. 3
Consolidated Balance Sheets ................................................ 4
Consolidated Statements of Operations ...................................... 6
Consolidated Statements of Stockholders' Equity ............................ 7
Consolidated Statements of Cash Flows ...................................... 8
Notes to the Consolidated Financial Statements ............................. 10
<PAGE>
CONSOLIDATED FINANCIAL STATEMENTS
November 15, 1999
The accompanying consolidated balance sheets of Global Seafood Technologies,
Inc. as of September 30, 1999 and 1998 and the related consolidated statements
of operations, stockholders' equity and cash flows for the six months periods
ending September 30, 1999 and 1998 are the responsibility of the Company's
management.
The data has not been subjected to audit and has been derived from the Company's
internally produced financial records. While the Company believes such interim
data to be materially correct, their failure to be subjected to independent
audit or to auditing standards should be noted. All such data should be read
only in conjunction with, and is qualified in their entirety by reference to,
the Company's financial statements and accompanying notes.
Management believes that the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position of
Global Seafood Technologies, Inc. (formerly International Custom Pack, Inc.) as
of September 30, 1999 and 1998 and the results of its operations and cash flows
for the six months periods ended September 30, 1999 and 1998 consistent with
previously prepared financial reports.
Brent Gutierrez, Chairman and President
Global Seafood Technologies, Inc.
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
ASSETS UNAUDITED
September 30
----------------------------
1999 1998
----------- -----------
CURRENT ASSETS
Cash and cash equivalents (Note 1) 1,962,321 319,573
Accounts Receivable- net (Note 1) 891,356 1,240,754
Accounts Receivable - Related, net (Note 1) 167,007 0
Pre-paid income taxes 46,111 38,572
Pre-paid Expenses 212,355 6,045
Inventories (Note 1) 502,125 153,655
Deferred tax asset, current 2,300 0
----------- -----------
TOTAL CURRENT ASSETS $ 3,783,576 $ 1,758,600
PROPERTY AND EQUIPMENT
Land 102,926 102,926
Buildings and Improvements 2,057,888 1,989,036
Furniture and Fixtures 26,780 26,780
Machinery and Equipment 3,069,494 2,502,277
Vehicles 27,820 27,820
Water Well 121,441 121,441
----------- -----------
TOTAL FIXED ASSETS 5,406,348 4,770,279
Less Accumulated Depreciation (2,375,320) (1,993,473)
----------- -----------
PROPERTY AND EQUIPMENT, NET (Notes 1 and 2) $ 3,031,028 $ 2,776,806
OTHER ASSETS
Deferred tax asset 12,300 0
Deposits 20,014 3,089
----------- -----------
Total Other Assets $ 32,314 $ 3,089
TOTAL ASSETS $ 6,846,918 $ 4,538,495
The accompanying notes are an integral part of these consolidated financial
statements
4
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
UNAUDITED
September 30
----------------------------
1999 1998
------------ ------------
CURRENT LIABILITIES
Accounts Payable 510,749 525,733
Accounts Payable - Related (Note 1) 71,583 0
Accrued expenses 29,551 26,216
Income taxes payable 918 (4,539)
Notes Payable, short-term (Note 5) 0 300,000
Notes Payable, current portion (Note 3) 178,992 103,909
Notes Payable - Related (Note 4) 113,500 114,011
Obligations under capital leases (Note 6) 33,080 149,164
------------ ------------
TOTAL CURRENT LIABILITIES $ 938,373 $ 1,214,495
LONG-TERM LIABILITIES
Notes Payable (Note 3) 1,417,642 1,380,307
Obligations under capital leases (Note 6) 63,954 86,446
------------ ------------
TOTAL LONG-TERM LIABILITIES $ 1,481,596 $ 1,466,753
TOTAL LIABILITIES $ 2,419,969 $ 2,681,248
STOCKHOLDER'S EQUITY
Preferred stock 200 30
(Issued and outstanding) 200,000 30,000
Common stock 12,877 11,628
(Issued and outstanding) 12,876,915 11,628,082
Additional Paid-in Capital 4,080,547 1,239,365
Treasury Stock 0 0
Retained Earnings 333,325 606,224
------------ ------------
TOTAL STOCKHOLDER'S EQUITY $ 4,426,949 $ 1,857,247
TOT. LIAB. AND EQUITY $ 6,846,918 $ 4,538,495
COMMITMENTS AND CONTINGENCIES (Note 8)
The accompanying notes are an integral part of these consolidated financial
statements
5
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
UNAUDITED
Six Months Ended September 30
-------------------------------
1999 1998
------------ ------------
Processing Sales 1,973,844 1,260,381
Sales of Product 5,572,598 5,088,491
------------ ------------
NET SALES $ 7,546,442 $ 6,348,872
COST OF SALES $ 4,753,155 $ 4,144,599
GROSS MARGIN $ 2,793,287 $ 2,204,273
EXPENSES
Salaries, wages and commissions 1,180,278 744,764
Non-compete covenant 7,972 8,200
Depreciation expense 205,695 138,440
Bad debt expense 0 0
Selling, general and administrative 1,450,908 1,100,044
------------ ------------
TOTAL EXPENSES $ 2,844,854 $ 1,991,447
INCOME BEFORE OTHER ITEMS ($ 51,567) $ 212,827
Other income 23,933 36,989
Interest income 11,751 3,936
Gain of disposition of assets 0 18,000
Interest expense (74,672) (61,727)
------------ ------------
TOTAL OTHER INCOME (EXPENSE) ($ 38,987) ($ 2,802)
NET INCOME BEFORE TAXES ($ 90,554) $ 210,025
PROVISION FOR TAXES $ 918 $ 0
NET INCOME ($ 91,472) $ 210,025
BASIC EARNINGS PER SHARE ($ 0.01) $ 0.02
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 12,671,383 11,628,082
FULLY DILUTED EARNINGS
PER SHARE ($ 0.00) $ 0.02
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 19,886,719 11,961,415
The accompanying notes are an integral part of these consolidated financial
statements
6
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
Consolidated Statements of Shareholders' Equity
<TABLE>
<CAPTION>
Preferred Stock Common Stock Additional
---------------------------- ---------------------------- Paid-in Retained
Shares Amount Shares Amount Capital Earnings
------------ ------------ ------------ ------------ ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Balance, March 31, 1999 30,000 $ 30 11,678,082 $ 11,678 $ 1,289,316 $ 424,797
Common stock issued on
April 1, 1999 to purchase the
assets of Killer Bee, Inc. 152,564 $ 153 $ 237,847
Common stock issued in lieu
of future payments under
non-compete agreement 114,800 $ 115 $ 143,385
Preferred stock issued for cash
in April, 1999 200,000 $ 200 $ 1,999,800
Cash received for common stock
issued into escrow prior to
March 31, 1999 599,469 $ 599 $ 370,501
Common stock issued for
prepaid promotional services in
April, 1999 32,000 $ 32 $ 39,968
Outstanding preferred stock (30,000) ($ 30) ($ 299,970)
converted to common stock 300,000 $ 300 $ 299,700
Net income for six months ended
September 30, 1999 ($ 91,472)
Balance, September 30, 1999 200,000 $ 200 12,876,915 $ 12,877 $ 4,080,547 $ 333,325
============ ============ ============ ============ ============ ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
7
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
Six Months Ended September 30
--------------------------
1999 1998
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income ($ 91,472) $ 210,025
Adjustments to Net Income:
Depreciation 205,695 138,440
(Gain) Loss on Sale of Assets 0 0
Bad Debts 0 0
----------- -----------
Total Adjustments to Net Income $ 205,695 $ 138,440
Changes in Assets and Liabilities:
(Increase) Decrease in Accounts Receivable
and Accounts Receivable Related (427,346) (806,560)
(Increase) Decrease in Taxes Receivable 0 0
(Increase) Decrease in Deferred Tax Asset 0 0
(Increase) Decrease in Inventories (502,125) 0
(Increase) Decrease in Pre-paid Expenses (162,355) 0
(Increase) Decrease in Deposits (8,870) 0
Increase (Decrease) in Accounts Payable
and Accounts Payable Related (179,125) 188,116
Increase (Decrease) in Taxes Payable 0 (21,683)
Increase (Decrease) in Accrued Expenses 2,366 (9,607)
----------- -----------
Total Changes in Assets and Liabilities (1,277,456) (649,734)
Net Cash Provided by Operating Activities ($1,163,233) ($ 301,269)
CASH FLOWS FROM INVESTING ACTIVITIES:
Sale of Property and Equipment 37,500 18,000
Purchase of Property and Equipment (488,993) (429,360)
----------- -----------
Net Cash Used in Investing Activities ($ 451,493) ($ 411,360)
CASH FLOWS FROM FINANCING ACTIVITIES:
Additional Capital Contributed 792,600 0
Proceeds From Sale of Preferred Stock 2,000,000 100,000
Payments on Notes Payable and Leases Payable (728,802) 0
Proceeds From Notes Payable and Leases Payable 769,531 893,572
----------- -----------
Net Cash Provided (Used by)Financing Activities $ 2,833,329 $ 993,572
NET INCREASE (DECREASE) IN CASH $ 1,218,603 $ 280,942
BEGINNING CASH AND CASH EQUIVALENTS $ 743,718 $ 38,631
ENDING CASH AND CASH EQUIVALENTS $ 1,962,321 $ 319,573
The accompanying notes are an integral part of these consolidated financial
statements
8
<PAGE>
CONSOLIDATING STATEMENT OF OPERATIONS
GLOBAL SEAFOOD TECHNOLOGIES, INC.
<TABLE>
<CAPTION>
UNAUDITED
6 mos ended
Custom Aquaculture Killer Combined September 30
Pack CoMar Division Bee Totals Eliminations 1999
--------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Processing Sales 1,973,844
Sales of Product 4,725,779 279,183 19,454 548,182 5,572,598
--------------------------------------------------------------------------------------------------
NET SALES 6,699,623 279,183 19,454 548,182 7,546,442 7,546,442
COST OF SALES 4,380,746 32,406 9,960 330,043 4,753,155 4,753,155
--------------------------------------------------------------------------------------------------
GROSS MARGIN $2,318,877 $246,777 $9,494 $218,139 $2,793,287 $2,793,287
EXPENSES
Salaries, wages and
commissions 806,094 230,805 (386) 143,766 1,180,278 1,180,278
Non-compete covenant 7,972 0 0 0 7,972 7,972
Depreciation expense 118,520 18,745 22,591 25,383 185,239 20,456 205,695
Bad debt expense 0 0 0 0 0 0
Selling, general and
administrative 1,039,260 77,215 14,513 319,920 1,450,908 1,450,908
--------------------------------------------------------------------------------------------------
TOTAL EXPENSES $1,971,846 $326,765 $36,718 $489,069 $2,824,398 $20,456 $2,844,854
INCOME BEFORE OTHER ITEMS $347,031 ($79,988) ($27,224) ($270,930) ($31,111) ($20,456) ($51,567)
Other income 23,933 0 0 0 23,933 23,933
Interest income 11,751 0 0 0 11,751 11,751
Gain on disposition of assets 0 0 0 0 0 0
Interest expense (39,031) (24,210) (7,032) (4,399) (74,672) (74,672)
--------------------------------------------------------------------------------------------------
TOTAL OTHER INCOME (EXPENSE) ($3,346) ($24,210) ($7,032) ($4,399) ($38,987) $0 ($38,987)
NET INCOME BEFORE TAXES $343,685 ($104,199) ($34,256) ($275,328) ($70,098) ($20,456) ($90,554)
PROVISION FOR TAXES 0 918 0 0 918 918
NET INCOME $343,685 ($105,117) ($34,256) ($275,328) ($71,016) ($20,456) ($91,472)
</TABLE>
9
<PAGE>
GLOBAL SEAFOOD TECHNOLOGIES, INC.
(Formerly International Custom Pack, Inc.)
Notes to the Consolidated Financial Statements
September 30, 1999 and 1998
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
The consolidated financial statements include those of Global Seafood
Technologies, Inc. (formerly International Custom Pack, Inc.) and its
wholly owned subsidiaries: Custom Pack, Inc., CoMar Foods, Inc., and
Killer Bee, Inc. Custom Pack, Inc. has a separate division that is
accounted for as the "Aquaculture Division" in the consolidated
financial statements, although it is not a separate subsidiary.
Collectively, they are referred to herein as "the Company".
Global Seafood Technologies, Inc. (GSFT) was incorporated under the
laws of the State of Nevada on May 29, 1986 under the name of Rue de
Rivoli Perfumeries of America, LTD. It later changed its name to
Enviro Solutions International, Inc. on November 21, 1994 in
contemplation of a merger with Enviro Solutions International, Inc. of
Utah. The merger was never completed. However, the name was still
changed.
On October 31, 1995, the Company completed an Agreement and Plan of
Reorganization whereby GSFT issued 8,000,000 shares of its common
stock in exchange for all of the outstanding common stock of Custom
Pack, Inc. (Custom). Pursuant to the reorganization, the name was
changed to International Custom Pack, Inc. The Company later changed
its name to Global Seafood Technologies, Inc. during 1998.
The reorganization was accounted for as a recapitalization of Custom
because the shareholders of Custom control the Company after the
acquisition. Therefore, Custom is treated as the acquiring entity.
Accordingly, there was no adjustment to the carrying value of the
assets or liabilities of GSFT. GSFT is the acquiring entity for legal
purposes and Custom is the surviving entity for accounting purposes.
On October 1, 1997, the Company completed an Agreement and Plan of
Reorganization whereby GSFT issued 422,492 shares of its common stock
and $300,000 of cash in exchange for all of the outstanding common
stock of CoMar Foods, Inc. (CoMar). The acquisition was accounted for
as a purchase.
On April 1, 1999, the Company issued 152,564 shares of its common
stock to purchase the assets of a related company, Killer Bee, Inc.
(Killer Bee). The physical assets consisted of product inventory,
which was recorded at historical cost.
GSFT was incorporated for the purpose of creating a vehicle to obtain
capital to seek out, investigate and acquire interests in products and
businesses which may have a potential for profit.
10
<PAGE>
NOTE 1- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Custom, a wholly-owned subsidiary, was incorporated under the laws of
Mississippi on February 15, 1988. It was incorporated for the purpose
of being a full service processor, packager, and storage provider of
shrimp and other seafood.
Comar, a wholly-owned subsidiary, was incorporated under the laws of
the State of Alabama on February 26, 1993. It was incorporated for the
purpose of being a full service processor and packager of shrimp and
other seafood products.
Killer Bee, a wholly-owned subsidiary, was incorporated September 18,
1998. It was incorporated for the purpose of being a full service
processor, packager and distributor of bait and other recreational
fishing products.
b. Accounting Method
The Company's consolidated financial statements are prepared using the
accrual method of accounting. The Company has elected a March 31 year
end.
c. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with
maturities of three months or less at the time of acquisition. The
Company's cash accounts at its banks are insured by the FDIC up to
$100,000. The Company's bank employs an overnight "sweep" to invest
cash balances which are in excess of daily operating needs.
d. Basic and Fully Diluted Earnings Per Share
The computations of basic earnings per share of common stock are based
on the weighted average number of shares outstanding during the period
of the consolidated financial statements. Common stock equivalents,
consisting of the preferred shares and outstanding warrants, have been
included in the fully diluted earnings per share.
e. Principles of Consolidation
The consolidated financial statements include those of Global Seafood
Technologies, Inc. and its wholly-owned subsidiaries; Custom Pack,
Inc., CoMar Foods, Inc., and Killer Bee, Inc. All significant
intercompany accounts and transactions have been eliminated.
11
<PAGE>
NOTE 1- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
f. Inventories
Inventory supplies are stated at the lower of cost (computed on a
first-in, first-out basis) or market. The inventory consists of
seafood, bait products, seafood storage bags, packing boxes and other
miscellaneous packaging materials.
g. Property and Equipment
Property and equipment are stated at cost. Expenditures for small
tools, ordinary maintenance and repairs are charged to operations as
incurred. Major additions and improvements are capitalized.
Depreciation is computed using the straight-line and accelerated
methods over estimated useful lives as follows:
Machinery and equipment 5 to 7 years
Furniture and fixtures 5 to 7 years
Buildings 3 to 7 years
Vehicles 5 years
Water Well 7 years
h. Accounts Receivable
Accounts receivable are recorded net of allowance for doubtful
accounts of $5,886 and $5,886 for the periods ending September 30,
1999 and 1998, respectively.
i. Related Party Transactions
The Company purchases some of its product and supplies from a related
company. The amounts owed to this company at September 30, 1999 and
1998 was $45,379 and $184,279, respectively.
The Company also sells some of its product to the same related
company. The amounts owed to this Company at September 30, 1999 and
1998 was $53,442 and $78,923, respectively.
j. Revenue Recognition
Revenue is recognized upon shipment of goods to the customer.
12
<PAGE>
NOTE 1- ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
k. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
l. Reclassifications
Certain prior period amounts have been reclassified to conform to the
September 30, 1999 financial statement presentation.
m. Advertising
The Company follows the policy of charging the costs of advertising to
expense as incurred.
n. Change in Accounting Principle
The Company adopted Statement of Financial Accounting Standards (SFAS)
No. 128, "Earnings Per Share" during the year ended March 31, 1999. In
accordance with SFAS No. 128, diluted earnings per share must be
calculated when an entity has convertible securities, warrants,
options, and other securities that represent potential common shares.
The purpose of calculating diluted earnings (loss) per share is to
show (on a pro forma basis) per share earnings or losses assuming the
exercise or conversion of all securities that are exercisable or
convertible into common stock and that would either dilute or not
affect basis EPS. As permitted by SFAS No. 128, the Company has
retroactively applied the provisions of this new standard by showing
the fully diluted earnings per common share for all periods presented.
13
<PAGE>
NOTE 2 - PROPERTY AND EQUIPMENT
Property and equipment at September 30, 1999 and 1998 consisted of the
following:
September 30
1999 1998
----------- -----------
Land $ 102,926 $ 102,926
Buildings and improvements 2,057,888 1,989,036
Furniture and fixtures 26,780 26,780
Machinery and equipment 3,069,494 2,502,277
Vehicles 27,820 27,820
Water Well 121,441 121,441
----------- -----------
Total $ 5,406,348 $ 4,770,279
Less accumulated depreciation (2,375,320) (1,993,473)
Property and equipment- net $ 3,031,028 $ 2,776,806
Depreciation expense for the six month periods ended September 30,
1999 and 1998 was $205,695 and $138,440, respectively.
NOTE 3 - NOTES PAYABLE
Notes payable at September 30, 1999 and 1998 consisted of the
following:
September 30
-------------------------
1999 1998
---------- ----------
Note payable, secured by property,
interest at 9.0%, interest and principal
payments of $1,497 due monthly, matures
July 1, 2012. 138,285 143,114
Note payable, secured by property,
interest at 8.0%, interest and principal
payments of $702 due monthly, matures
November 23, 2003. 29,401 35,223
Note payable, secured by property,
interest at 8.05%, interest and principal
payments of $16,124 due monthly, matures
July 5, 2003. 1,214,975 1,305,103
Note payable, secured by property,
interest at 7.5%, interest and principal
payments of $399 due monthly, matures
November 15, 2002. 13,447 --
---------- ----------
Balance forward $1,396,108 $1,483,440
14
<PAGE>
NOTE 3 - NOTES PAYABLE (Continued)
September 30
-------------------------
1999 1998
---------- ----------
Balance forward $1,396,108 $1,483,440
Note payable, secured by property,
interest at 7.5%, interest and principal
payments of $737 due monthly, matures
October 15, 2002. 24,218 -
Note payable, secured by property,
interest at 15.77%, interest and
principal payments of $47 due monthly,
matures December 16, 2001. 209 776
Note payable, secured by property,
interest at 11.09%, interest and
principal payments of $628 due monthly,
matured April , 1999. 173 628
Note payable, secured by property,
interest at 9.25%, interest and principal
payments of $440 due monthly, matures
September 22, 2002. 13,766 -
Note payable, secured by property,
interest at 7.5%, interest and principal
payments of $492 due monthly, matures
April 1, 2004. 21,764 -
Note payable, secured by property,
interest at 8.12%, interest and principal
payments of $1,531 due monthly, matures
June 25, 2004. 72,175 -
Note payable, secured by property,
interest at 8.12%, interest and principal
payments of $1,447 due monthly, matures
June 25, 2004. 68,221
Total notes payable 1,596,634 1,484,844
Less: current portion ( 178,992) ( 103,909)
---------- ----------
Long-term notes payable $1,417,642 $1,380,935
15
<PAGE>
Maturities of long-term debt are as follows:
Period Amount
------ ------
Six months ending March 31, 2000 $ 99,508
Year ending March 31, 2001 187,630
Year ending March 31, 2002 205,152
Year ending March 31, 2003 223,143
Year ending March 31, 2004 872,498
2005 and thereafter 8,703
----------
Total $1,596,634
NOTE 4 - NOTES PAYABLE RELATED PARTIES
Notes payable to related parties at September 30, 1999 and 1998
consisted of the following:
September 30
1999 1998
----------------------
Notes payable to shareholders, unsecured,
interest at 10%, interest payments due
quarterly and annually, principal amount
is due on demand. 113,500 114,011
NOTE 5 - LINE OF CREDIT
The Company has a line of credit with a bank. Borrowings, if any,
would be secured and would have a maximum balance outstanding of
$500,000. As of September 30, 1999 and 1998, the balance outstanding
under the line was $ -0- and $300,000, respectively.
NOTE 6 - CAPITAL LEASES
The Company leases certain equipment with lease terms ending in
October 1999 through September 2003. Obligations under these capital
leases have been recorded in the accompanying consolidated financial
statements at the present value of future minimum lease payments. The
capitalized cost of $945,388 less accumulated depreciation of $705,621
was included in property and equipment in the audited consolidated
financial statements at March 31, 1999.
16
<PAGE>
Obligations under capital leases at September 30, 1999 and 1998 were
as follows:
September 30
1999 1998
-----------------------
Total $ 97,034 $ 100,000
Less: current portion ( 33,080) ( 30,000)
--------- ---------
Long-term portion $ 63,954 $ 70,000
The future minimum lease payments under these capital leases from
September 30, 1999 and the net present value of the future minimum
lease payments are as follows:
Six months ending
-----------------
March 31, 2000 $ 22,724
Year ending
-----------
March 31, 2001 $ 35,838
March 31, 2002 24,091
March 31, 2003 24,091
March 31, 2004 11,314
March 31, 2005 and thereafter 0
--------
Total future minimum lease payments $118,058
Less, amount representing interest ( 21,024)
--------
Present value of future minimum lease payments $ 97,034
NOTE 7 - MAJOR CUSTOMERS AND SUPPLIERS
Customers generating in excess of 10% of the Company's total sales
were as follows: For the six months ended September 30, 1999 one
customer generated sales of approximately 13% of total revenues. For
the six months ended September 30, 1998, two customers generated
combined sales of approximately 74% of total revenues.
The Company purchased product from three suppliers during the six
months periods ending September 30, 1999 and 1998 that generated costs
in excess of 10% of the Company's total purchases. Purchases from
these three suppliers combined made up 45% and 54% of total purchases
for the six months ended September 30, 1999 and 1998, respectively.
17
<PAGE>
NOTE 8 - COMMITMENTS AND CONTINGENCIES
Common Stock Contingency
The Company is aware of numerous possible claims by individuals that
received either through purchase or otherwise, 850,000 forged shares
of the Company's common stock that purport to represent issued and
outstanding shares. The shares are not listed on the Company's
shareholder records and do not represent duly issued and outstanding
shares of the Company's common stock. Although no litigation is
pending in relation to these shares, it is possible that the Company
may have to honor these 850,000 shares of common stock in the future.
The shares have not been recorded by the Company at September 30, 1999
since the outcome is currently not estimatable.
Leases
The Company has entered into several non-cancelable leases, accounted
for as operating leases, of certain machinery and equipment used in
operations. The minimum future payments required under the operating
leases are as follows:
Six months ending
-----------------
March 31, 2000 $ 86,788
Year ending
-----------
March 31, 2001 $ 113,204
March 31, 2002 10,894
March 31, 2003 10,894
March 31, 2004 5,147
March 31, 2005 and thereafter 0
---------
Total future minimum lease payments $ 226,927
NOTE 9 - WARRANTS OUTSTANDING
On November 1, 1998, the Company granted warrants to a consultant to
purchase 1,000,000 shares of the Company's common stock at $1.00 per
share. The warrants are exercisable until July 1, 2008.
On March 23, 1999, the Company granted warrants to an investor to
purchase 2,000,000 shares of the Company's common stock at $1.00 per
share. The warrants are exercisable until March 23, 2009.
On April 1, 1999, the Company granted warrants to purchase 1,500,000
shares of the Company's common stock at $1.56 per share in connection
with the purchase of the assets of Killer Bee, Inc. Warrants of
500,000 shares were granted to each of the sellers (three individuals,
which included two executive officers and directors of the Company).
The warrants are exercisable until April 1, 2009.
18
<PAGE>
NOTE 10 - CONSOLIDATING STATEMENT OF OPERATIONS
The Company's consolidating statement of operations for the six months
ended September 30, 1999 is detailed in the attached schedule.
19
<PAGE>
PART III
ITEM 1 Index to Exhibits
<TABLE>
<CAPTION>
Exhibit
Number Description Location
- ------ ----------- --------
<S> <C> <C>
2.0 Stock for Stock Acquisition Agreement Filed electronically
between Enviro Solution Int'l. and Custom herewith
Pack dated October 31, 1995
3.0 Articles of Incorporation dated May 29, 1986 Filed electronically
herewith
3.1 Certificate of Amendment of Articles of Filed electronically
Incorporation dated July 18, 1994 herewith
3.2 Certificate of Amendment of Articles of Filed electronically
Incorporation dated November 21, 1994 herewith
3.3 Certificate of Amendment of Articles of Filed electronically
Incorporation dated November 22, 1995 herewith
3.4 Certificate of Amendment of Articles of Filed electronically
Incorporation dated November 25, 1997 herewith
3.5 Certificate of Amendment of Articles of Filed electronically
Incorporation dated December 22, 1998 herewith
3.6 By-Laws Filed electronically
herewith
4.0 Specimen of common stock certificate Filed electronically
herewith
4.1 Common stock purchase warrant dated Filed electronically
November 1, 1998 herewith
4.2 Form of common stock purchase warrant Filed electronically
dated April 1, 1999 herewith
4.3 Form of common stock purchase warrant Filed electronically
dated July 16, 1999 herewith
10.0 Agreement and Plan of Reorganization dated Filed electronically
October 1, 1997 between the company and herewith
shareholders of CoMar Foods, Inc.
</TABLE>
22
<PAGE>
<TABLE>
<CAPTION>
Exhibit
Number Description Location
- ------ ----------- --------
<S> <C> <C>
10.1 Asset Purchase Agreement dated June 25, 1999 Filed electronically
herewith
21.0 List of Company's Subsidiaries Filed electronically
herewith
27 Financial Data Schedule Filed electronically
herewith
</TABLE>
23
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this amendment to be signed on its behalf by the undersigned,
thereunto duly authorized.
Global Seafood Technologies, Inc.
Date: December 13, 1999 By: /s/ Brent Gutierrez
-----------------------
Brent Guttierrez, President
STOCK-FOR-STOCK ACQUISITION AGREEMENT
This Stock-For-Stock Acquisition Agreement ("the Agreement"), entered into this
31st day of October 1995, by, between, and among Enviro Solutions International
Inc., a publicly held Nevada corporation (hereinafter the "Purchaser"), Custom
Pack, Inc., a privately held Mississippi corporation (hereinafter the
"Company"), and the shareholders of the Company whose names and signatures are
set forth upon the signature page of this Agreement (the "Shareholders").
Witnesseth
WHEREAS, the Purchaser wishes to acquire, and the shareholders are
willing to sell, all of the outstanding stock of the Company in the exchange
solely for a part of the voting stock of the Purchaser whereby the Shareholder
would acquire a controlling interest of the Purchaser;
NOW, THEREFORE, in consideration of the mutual terms and covenants set
forth herein, the Purchaser, the Company, and the Shareholders approve and adopt
this Agreement and mutually covenant and agree with each other as follows:
1. Shares to be Transferred and Shares to be issued.
1.1 On the closing date the Shareholders shall transfer to the
Purchaser certificates for the number of shares of the common stock of the
Company described in Schedule "A", attached hereto and incorporated herein,
which in the aggregate shall represent all of the issued and outstanding
shares of the common stock of the Company. Such certificates shall be duly
endorsed in blank by the Shareholder or accompanied by duly executed stock
powers in blank with signatures guaranteed.
1.2 In exchange for the transfer of the common stock of the Company
pursuant to subsection 1.1. hereof, the Purchaser shall, on the closing
date and contemporaneously with such transfer of the common stock of the
Company to it by the Shareholders, issue and deliver to the Shareholders
the number of shares of common stock of the Purchaser specified on Schedule
"A" hereof such that the Shareholders shall own not less than eighty
percent (80%) of the outstanding common stock of the Purchaser.
2. Representations and Warranties of the Shareholders. The Shareholders,
severally and not jointly represent and warrant as follows:
2.1 Ownership of Stock
a. Each of the Shareholders is the record owner and holder of the
number of fully paid and nonassessable shares of the common stock
of the Company listed in Schedule "A: hereto as of the date
hereof and will continue to own such shares of the common stock
of the Company until the delivery thereof to the Purchaser on the
closing date and all such shares of common stock are or will be
on the closing date owned free and clear of
<PAGE>
all liens, encumbrances, charges and assessments of every nature
and subject to no restrictions with respect to transferablility.
Each of the Shareholders will have full power and authority to
assign and transfer his, her, or its shares of the Company in
accordance with the terms hereof.
b. Except for this Agreement, there are no outstanding options,
contracts, calls, commitments, agreements or demands of any
character relating to the stock of the Company owned by the
Shareholders or the stock of the Purchaser to be received by the
Shareholders.
3. Representations and Warranties of the Company. The Company represents
and warrants as follows:
3.1 Organization and Authority
a. The Company is a corporation duly organized, validly existing
and in good standing under the laws of the state of Mississippi
with the full power and authority to enter into and perform the
transactions contemplated by this Agreement.
b. The outstanding shares of the Company are legally and validly
issued, fully paid and nonassessable.
c. The minute book of the Company made available to the Purchaser
contains the Articles of Incorporation of the Company as amended,
Bylaws, and complete and accurate records of all meetings and
other corporate actions of the shareholders and the board of
directors (and any committee thereof) of the Company.
3.2 Financials. True copies of the Financial statements of the Company
for the years ended March 31, 1994 and 1993, and the period ended September
30, 1995, have been furnished to the Purchaser. Said financial statements
are true and correct in all material respects and present an accurate and
complete disclosure of the financial condition of the Purchaser as of
September 30, 1994, and the earnings for the periods covered, in accordance
with generally accepted accounting principles applied on a consistent
basis.
3.3 Liabilities. There are no material liabilities of the Company,
whether accrued, absolute, contingent, or otherwise, which arose or relate
to any transaction of the Company, its agents or servants occurring prior
to September 30, 1994, which are not disclosed by or reflected in said
financial statements.
<PAGE>
3.4 Litigation. There are no legal, administrative or other
proceedings, investigations, or inquiries, product liability' or other
claims, judgments, injunctions, or restrictions, either threatened,
pending, or outstanding against involving the Company or its subsidiaries,
if any, or their assets, properties, or business, nor does the Company or
its subsidiaries know, or have reasonable grounds to know, of any basis for
any such proceedings, investigations or inquiries, product liability or
other claims, judgments, injunctions or restrictions, except as disclosed
in the disclosure schedule. In addition, there are no material proceedings
existing, pending or reasonably contemplated to which any officer,
director, or affiliate of the Company or as to which the Shareholder is a
party adverse to the Company or any of its subsidiaries or has a material
interest adverse to the Company or any of its subsidiaries.
3.5 Taxes. All federal, state, foreign, county and local income,
profits, franchise, occupation, property, sales, use, gross receipts and
other taxes (including any interest or penalties relating thereto) and
assessments which are due and payable have been duly reported, fully paid
and discharged as reported by the Company, and there are no unpaid taxes
which are, or could become a lien on the properties and assets of the
Company, except as provided for in the financial statements of the Company,
or have been incurred in the normal course of business of the company since
that date. All tax returns of any king required to be filed have been filed
and the taxes paid or accrued.
3.6 Accuracy of All Statements Made by Company. No representation or
warranty by the Company and the Shareholder in this Agreement, nor any
statement, certificate, schedule or exhibit hereto furnished or to be
furnished by or on behalf of the Company or the Shareholder pursuant to
this Agreement, nor any document or certificate delivered to the Purchaser
pursuant to this Agreement or in connection with actions contemplated
hereby, contains or shall contain any untrue statement of material fact or
omits or shall omit a material fact necessary to make the statement
contained therein not misleading.
4. Representations and Warranties of the Purchaser. The Purchaser
represents and warrants as follows:
4.1 Organization and Good Standing. The Purchaser is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Nevada with full power and authority to enter into and perform the
transactions contemplated by this Agreement. The Purchaser has
approximately 211 shareholders of record, each of whom is reasonably
believed to be the beneficial owner of his, hers, or its shares with no
prearrangement to sell such shares in connection with this transaction.
4.2 Performance of This Agreement. The execution and performance of
this Agreement and the issuance of stock contemplated hereby have been
authorized by the board of directors of the Purchaser.
<PAGE>
4.3 Financials. True copies of the financial statements of the
Purchaser for the years ended May 31, 1993 and 1992, and the period ended
May 31, 1995, have been delivered by the Purchaser of the Company. Said
financial statements are true and correct in all material respects and
present an accurate and complete disclosure of the financial condition of
the Purchaser as of May 31, 1995 and the earnings for the periods covered,
in accordance with generally accepted accounting principles applied on a
consistent basis.
4.4 Liabilities. There are no material liabilities of the Purchaser,
whether accrued, absolute, contingent or otherwise, which arose or relate
to any transaction of the Purchaser, its agents or servants which are not
disclosed by or reflected in said financial statements. As of the date
hereof, there are no known circumstances, conditions, happenings, events or
arrangements, contractual or otherwise, which may hereafter give rise to
liabilities, except in the normal course of business of the Purchaser.
4.5 Litigation. There are no legal, administrative or other
proceedings, investigations or inquiries, product liability or other
claims, judgments, injunctions or restrictions, either threatened, pending
or outstanding against or involving the Purchaser or its subsidiaries, if
any, or their assets, properties, or business, nor does the Purchaser or
its subsidiaries know, or have reasonable grounds to know, of any basis for
any such proceedings, investigations or inquiries, product liability or
other claims, judgments, injunctions or restrictions.
4.6 Taxes. All federal, state, foreign, county and local income,
profits, franchise, occupation, property, sales, use, gross receipts and
other taxes (including any interest or penalties relating thereto) and
assessments which are due and payable have been duly reported, fully paid
and discharged as reported by the Purchaser, and there are no unpaid taxes
which are, or could become a lien on the properties and assets of the
Purchaser. All tax returns of any kind required to be filed have been filed
and the taxes paid or accrued.
4.7 Legality of Shares to be Issued. The shares of common stock of the
Purchaser to be delivered pursuant to this Agreement, when so delivered,
will have been duly and validly authorized and issued by the Purchaser and
will be fully paid and nonassessable.
4.8 No Covenant as to Tax Consequences. It is expressly understood and
agreed that neither the Purchaser nor its officers or agents has made any
warranty or agreement, expressed or implied, as to the tax consequences of
the transactions contemplated by this Agreement or the tax consequences of
any action pursuant to or growing out of this Agreement.
4.9 Accuracy of All Statements Made by the Purchaser. No
representation or warranty by the Purchaser in this Agreement, nor any
statement, certificate, schedule or exhibit hereto furnished or to be
furnished by the Purchaser pursuant to this Agreement, nor any document or
certificate delivered to the Company or the Shareholder pursuant to this
Agreement or in connection with actions contemplated hereby, contains or
shall contain any untrue statement of material fact or omits or shall omit
a material fact necessary to make the statement contained therein not
misleading.
<PAGE>
5. Conditions Precedent to the Purchaser's Obligations. Each and every
obligation of the Purchaser to be performed on the closing date shall be subject
to the satisfaction prior thereto of the following conditions:
5.1 Truth of Representations and Warranties. The representations and
warranties made by the Company and the Shareholder in this Agreement or
given on their behalf hereunder shall be substantially accurate in all
material respects on and as of the closing date with the same effect as
though such representations and warranties had been made or given on and as
of the closing date.
5.2 No Material Adverse Change. As of the closing date there shall not
have occurred any material adverse change which materially impairs the
ability of the Company to conduct its business or the earning power thereof
on the same basis as in the past.
5.3 Accuracy of Financial Statements. The Purchaser and its
representatives shall be satisfied as to the accuracy of all balance
sheets, statements of income and other financial statements of the Company
furnished to the Purchaser herewith.
5.4 Time Limit on Closing. Closing shall have taken place by October
31, 1995.
6. Conditions Precedent to Obligations of the Company and the Shareholders.
Each and every obligation of the Company and the Shareholders to be performed on
the closing date shall be subject to the satisfaction prior thereto of the
following conditions:
6.1 Truth of Representations and Warranties. The representations and
warranties made by the Purchaser in the Agreement or given on its behalf
hereunder shall be substantially accurate in all material respects on and
as of the closing date with the same effect as though such representations
and warranties had been made or given on and as of the closing date.
6.2 No Material Adverse Change. As of the closing date there shall not
have occurred any material adverse change which materially impairs the
ability of the Purchaser to conduct its business.
6.3 Accuracy of Financial Statements. The Company and the Shareholder
shall be satisfied as to the accuracy of all balance sheets, statements of
income and other financial statements of the Purchaser furnished to the
Company herewith.
6.4 Time Limit on Closing. Closing shall have taken place by October
31, 1995.
<PAGE>
7. Security Act Provisions.
7.1 Restrictions on Disposition of Shares. Each of the Shareholders,
severally and not jointly, covenants and warrants that the shares received
are acquired for his, her, or its own account and not with the present view
towards the distribution thereof and he, she, or it will not dispose of
such shares except (i) pursuant to an effective registration statement
under the Securities Act of 1933, as amended, or (ii) in any other
transaction which, in the opinion of counsel, acceptable to the Purchaser,
is exempt from registration under the Securities Act of 1933, as amended,
or the rules and regulations of The Securities and Exchange Commission
thereunder. In order to effectuate the covenants of this sub-section 6.1.,
an appropriate endorsement will be placed upon each of the certificates of
common stock of the Purchaser at the time of distribution of such shares by
the Company pursuant to this Agreement, and stop transfer instructions
shall be placed with the transfer agent for the securities.
7.2 Evidence of Compliance with Private Offering Exemption. Each of
the Shareholders, severally and not jointly, agrees to supply the Purchaser
with evidence of the financial sophistication of the Shareholder or
evidence of appointment of a sophisticated investment representative and
such other items as counsel for the Purchaser may require in order to
evidence the private offering character of the distribution of shares made
pursuant to the Agreement.
7.3 Notice of Limitation Upon Disposition. Each of the Shareholders,
severally and not jointly, represents that he, she, or it is aware that the
shares distributed to him, her or it will not have been registered pursuant
to the Securities Act of 1933, as amended; and, therefore, under current
interpretations and applicable rules, he, she, or it will probably have to
retain such shares for a period of at least two years and at the expiration
of such two year period his, her, or its sales may be confined to brokerage
transactions of limited amounts requiring certain notification filings with
the Securities and Exchange Commission and such disposition may be
available only if the Purchaser is current in its filings with the
Securities and Exchange Commission under the Securities Exchange Act of
1934, as amended, or other public disclosure requirements, and the other
limitations imposed thereby on the disposition of shares of the Purchaser.
8. Appointment of New Officers and Directors. Upon and as a condition of
closing this Agreement:
8.1 At closing the Purchaser will deliver the resignation of Alan
Pausner, Stephen Velte and Mary Francis Pausner as the officers and
directors of the Purchaser, and shall increase the number of directors to
persons.
8.2 Prior to closing the Company will furnish material information of
Brent Gutierrez, Clay Gutierrez, and Anita Gutierrez as nominees to be
appointed to fill the vacancies created by the foregoing resignation and
the increase in the number of directors.
<PAGE>
9. Closing.
9.1 Time and Place. The closing of this transaction ("closing") shall
take place at _____________________at_______.m., October 31, 1995, or at
such other time and place as the parties hereto shall agree upon. Such date
is referred to in this agreement as the "closing date."
9.2 Documents To Be Delivered by the Company and the Shareholders. At
the closing the Company and the Shareholders shall deliver to the Purchaser
the following documents:
a. Certificates for the number of shares of common stock of the
Company in the manner and form required by sub-section 1.1 hereof
b. A certificate signed by the Company that the representations and
warranties made by the Company in this Agreement are true and correct
on and as of the closing date with the same effect as though such
representations and warranties had been made on or given on and as of
the closing date.
c. Such other documents of transfer, certificates of authority and
other documents as the Purchaser may reasonably request.
9.3 Documents To Be Delivered by the Purchaser. At the closing the
Purchaser shall deliver to the Company and the Shareholders the following
documents:
a. Certificates for the number of shares of common stock of the
Purchaser as determined in sub-section 1.2. hereof
b. A certificate signed by the Purchaser that the representations and
warranties made by the Purchaser in this Agreement are true and
correct on and as of the closing date with the same effect as though
such representations and warranties had been made on or given on and
as of closing date.
10. Finder's Fee. The parties hereto agree that there are no finder's fees
payable directly or indirectly in connection with this transaction by any party
hereto.
11. Default. Should any party to this Agreement default in any of the
covenants, conditions, or promises contained herein, the defaulting party shall
pay all costs and expenses, including a reasonable attorney's fee, which may
arise or accrue from enforcing this Agreement, or in pursuing any remedy provide
hereunder.
a. Financial Consultant Agreement. For a period of Two years following
the closing, PNC Investments LTD Inc. will be engaged by Enviro
Solutions International Inc. as the Investment Bankers for Enviro
Solutions International Inc.
<PAGE>
12. Assignment. This Agreement may not be assigned in whole or in part by
the parties hereto without the prior written consent of the other party or
parties, which consent shall not be unreasonably withheld.
13. Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto, their heirs, executors,
administrators, successors and assigns.
14. Partial Invalidity. If any term covenant, condition or provision of the
Agreement or the application thereof to any person or circumstance shall to any
extent be invalid or unenforceable, the remainder of this Agreement or
application of such term or provision to persons or circumstances other than
those as to which it is held to be invalid or unenforceable shall not be
affected thereby and each term, covenant, condition or provision of this
Agreement shall be valid and shall be enforceable to the fullest extent
permitted by law.
15. No Other Agreements. This Agreement constitutes the entire Agreement
between the parties and there are and will be not oral representations which
will be binding upon any of the parties hereto.
16. Survival of Covenants. Etc. All Covenants, representations, and
warranties made herein to any parties or in any statement or document delivered
to any party hereto, shall survive the making of this Agreement and shall remain
in full force and effect until the obligations of such party hereunder have been
fully satisfied.
17. Further Action. The parties hereto agree to execute and deliver such
additional documents and to take such other and further action as may be
required to carry out fully the transaction(s) contemplated herein.
18. Amendment. This Agreement or any provision hereof may not be changed,
waived, terminated or discharged except by means of a written supplemental
instrument signed by the party or parties against whom enforcement of the
change, waiver, termination, or discharge is sought.
19. Headings. The descriptive headings of the various Sections or parts of
this Agreement are convenience only and shall not affect the meaning or
construction of any of the provisions hereof
20. Counterparts. This agreement may be executed in two or more partially
or fully executed counterparts, each of which shall be deemed an original and
shall bind the signatory, but all of which together shall constitute but one and
the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties hereto executed the foregoing
Stock-For-Stock Acquisition Agreement as of the day and year first above
written.
PURCHASER: ENVIRO SOLUTIONS INTERNATIONAL INC.
By /s/ Alan Pausner
--------------------------------
Alan Pausner, President/Director
By /s/ Mary Francis Pausner
---------------------------
Mary Francis Pausner,
Secretary/Treasurer/Director
By /s/ Stephen Velte 10/31/95
--------------------------------
Stephen Velte, Director
<PAGE>
SHAREHOLDERS:
/s/ Brent C. Gutierrez
--------------------------
Brent C. Gutierrez
/s/ Clayton F Gutierrez
--------------------------
Clayton F. Gutierrez
/s/ Anita K. Gutierrez
--------------------------
Anita K. Gutierrez
/s/ Frank Gutierrez
--------------------------
Frank Gutierrez
COMPANY: Custom Pack, Inc.
By /s/ Brent Gutierrez, President
---------------------------------
Brent Gutierrez
<PAGE>
DEFINITIONS
1. Arrangement means any plan, contract, authorization or understanding,
whether or not set forth in a formal document.
2. Associate, as used throughout this questionnaire, means (a) any
corporation or organization (other than the Company or any of its subsidiaries)
of which I am an officer, director, or partner or of which I am, directly or
indirectly, the beneficial owner of 10 percent or more of any class of equity
securities, (b) any trust or other estate in which I have been a substantial
beneficial interest or as to which I serve as trustee or in a similar fiduciary
capacity, or (c) my spouse or any other member of my immediate family (see
definition).
3. Beneficially, when used in connection with the ownership of securities,
means (a) any interest in a security which entitles me to any of the rights or
benefits of ownership even though I may not be the owner of record, or (b)
securities owned by me directly or indirectly, including those held by me for my
own benefit (regardless of how registered) and securities held by others for my
benefit (regardless of how registered), such as custodians, brokers, nominees,
pledges, etc., and including securities held by an estate or trust in which I
have an interest as legatee or beneficiary, securities owned by a partnership of
which I am a member, securities held by a personal holding company of which I am
a stockholder, etc., and securities held in the name of my spouse or any other
member if my immediate family. (See definition.) A beneficial owner of a
security includes any person, who, directly or indirectly, through any contract,
arrangement understanding, relationship or otherwise has or shares
A. voting power which includes the power to vote, or to direct the
disposition, or such security.
B. investment power which includes the power to dispose, or to direct
the disposition of, such security.
In addition, you will be deemed to be the beneficial owner of any security
for which you have the right to acquire the voting or investment power within 60
days, including any right to acquire such security (a) through the exercise of
any option, warrant or right (b) through the conversion of a security, (c)
pursuant to the power to revoke a trust, discretionary account or similar
arrangement, or (d) pursuant to the automatic termination of a trust,
discretionary account or other similar arrangement.
4. Control means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a person,
whether through the ownership of voting securities, by contract or otherwise.
5. Family Relationship means any relationship by blood, marriage or
adoption, including spouses, parents, children, siblings, mothers and
fathers-in-law, sons and daughters-in-law, and brother and sisters-in-law.
6. Material when used in this questionnaire to qualify a requirement for
the furnishing of information as to any subject, limits the information required
to those matters as to which an average prudent investor ought reasonably to be
informed before purchasing the common stock of the Company.
7. Material relationship has not been defined by the Securities and
Exchange Commission. However, the Commission has indicated that it will probably
construe as a "material relationship" any dealings with a company, whether
arising from a close business connection or family relationship, a relationship
of control or otherwise. It seems prudent, therefore, to consider that I would
have such relationship, for example, with any organization of which I am an
officer, director, or trustee or partner or in which I own, directly or
indirectly, 10 percent or more of the outstanding voting stock, or in which I
have some other substantial interest, and with any person or organization with
whom I have, or with whom any relative or spouse (or any other person or
organization as to which I have any of the foregoing other relationships) has, a
contractual relationship.
<PAGE>
8. Promoter is any person who, acting alone or in concert with one or more
persons, directly or indirectly takes initiative in founding and organizing the
business or enterprise of a company. It also includes any person who, in
connection with the founding and organizing of the business or enterprise of a
company, directly or indirectly receives in consideration of services or
property (or both) 10 percent or more of any class of securities of the company
or 10 percent or more of the proceeds from the sale of any class of securities.
However, a person who receives such securities or proceeds either solely as
underwriting commissions or solely in consideration of property shall not be
deemed a "promoter" if such person does not otherwise take part in founding and
organizing the enterprise.
9. Plan includes all plans, contracts, authorizations or arrangements,
whether or not set forth in any formal document.
<PAGE>
SCHEDULE "A"
TO THE
STOCK-FOR-STOCK ACQUISITION AGREEMENT
NO. OF SHARES OF NO. OF SHARES OF
CUSTOM PACK, INC. ENVIRO SOLUTIONS INTL INC.
NAME OF SHAREHOLDER TO BE TRANSFERRED TO BE ISSUED
- ------------------- ----------------- ------------
Brent Carroll Gutierrez 25 2,666,667
Clayton F. Gutierrez 25 2,666,666
Frank and Anita Gutierrez, 25 2,666,666
as joint tenants with full
rights of survivorship
----- ---------
TOTALS 75 8,000,000
== =========
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
MAY 29 1986
[ILLEGIBLE], SECRETARY OF STATE
/s/ [ILLEGIBLE]
No. C 3652-86
ARTICLES OF INCORPORATION
OF
RUE DE RIVOLI PERFUMERIES OF AMERICA, LTD.
* * * * *
FIRST. The name of the corporation is
RUE DE RIVOLI PERFUMERIES OF AMERICA, LTD.
SECOND. Its principal office in the State of Nevada is located at 6555
Plumas, #171, Reno, Nevada 89509. The name and address of its resident agent is
Suzy Frost, 6555 Plumas, #171, Reno, Nevada 89509.
THIRD. The nature of the business, or objects or purposes proposed to be
transacted, promoted or carried on are: to engage in any lawful activity.
FOURTH. The amount of the total authorized capital stock of the corporation
is Twenty-Five Thousand Dollars ($25,000) consisting of twenty-five million
(25,000,000) shares of stock of the par value of One Thousandth Cent ($0.001)
each.
No shareholder of the corporation shall have any preemptive or preferential
right of subscription to any shares of any class of the corporation, whether now
or hereafter authorized, or to any obligations convertible into shares of the
corporation, issued or sold, nor any right of subscription to any thereof other
than such right, if any, and at such price as the Board of Directors, in its
discretion from time to time may determine, pursuant to the authority hereby
conferred by the
<PAGE>
Articles of Incorporation, and the Board of Directors may issue shares of
the corporation or obligations convertible into shares without offering such
issue either in whole or in part to the shareholders of the corporation, and not
holder of preferred shares of the corporation shall have any preemptive or
preferential right to receive any of such shares or obligations declared by way
of dividend. Should the Board of Directors as to any portion of the shares of
the corporation, whether now or hereafter authorized, or to any obligation
convertible into shares of the corporation, offer the same to the shareholders
or any class thereof, such offer shall not in any way constitute a waiver or
release of the right to the Board of Directors subsequently to dispose of other
portions of such shares or obligations without so offering the same to the
shareholders. The acceptance of shares in the corporation shall be a waiver of
any such preemptive or preferential right which in the absence of this provision
might otherwise be asserted by shareholders of the corporation or any of them.
FIFTH. The governing board of this corporation shall be known as directors,
and the number of directors may from time to time be increased or decreased in
such manner as shall be provided by the by-laws of this corporation, provided
that the number of directors shall not be reduced to less than three (3), except
that in cases where all the shares of the corporation are owned beneficially and
of record by either one or two stockholders, the number of directors may be less
than three (3) but not less than the number of stockholders.
-2-
<PAGE>
The names and post-office addresses of the first board of directors, which
shall be three (3) in number, are as follows;
NAME POST-OFFICE ADDRESS
- ----------------------- ---------------------------
Harold Johnson 416 W. 8th St., Ste. 330
Los Angeles, Calif. 90014
Mike Conti 416 W. 8th St., Ste. 330
Los Angeles, Calif. 90014
Tom Devine 416 W. 8th St., Ste. 330
Los Angeles, Calif. 90014
SIXTH. The capital stock, after the amount of the subscription price, or
par value, has been paid in shall not be subject to assessment to pay the debts
of the corporation.
SEVENTH. The name and post-office address of each of the incorporator
signing the articles of incorporation are as follows:
NAME POST-OFFICE ADDRESS
- ----------------------- ---------------------------
Suzy Frost 6555 Plumas, #171
Reno, Nevada 89509
EIGHTH. The corporation is to have perpetual existence.
NINTH. In furtherance, and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized:
Subject to the by-laws, if any, adopted by the stockholders, to make, alter
or amend the by-laws of the corporation.
To fix the amount to be reserved as working capital over and above its
capital stock paid in, to authorize and cause to be executed mortgages and liens
upon the real and personal property of this corporation.
-3-
<PAGE>
By resolution passed by a majority of the whole board, to designate one (1)
or more committees, each committee to consist of one (1) or more of the
directors of the corporation, which, to the extent provided in the resolution or
in the by-laws of the corporation, shall have and may exercise the powers of the
Board of Directors in the management of the business and affairs of the
corporation, and may authorize the seal of the corporation to be affixed to all
papers which may require it. Such committee or committees shall have such name
or names as may be stated in the by-laws of the corporation or as may be
determined from time to time by resolution adopted by the Board of Directors.
To enact by-laws, subject to any by-law enacted by the shareholders,
providing for the appointment of an executive committee of the Board of
Directors. The Board of Directors may define the duties of the executive
committee, but if not otherwise defined by the Board of Directors, it shall have
and exercise such of the powers of the Board of Directors, during the period of
time between meetings of the Board of Directors, as may be lawfully delegated.
The directors in their discretion may submit any contract or act for
approval or ratification at any annual meeting of the shareholders or at any
meeting of the shareholders called for the purpose of considering any such act
or contract, and any contract or act that shall be approved or be ratified by
the vote of the holders of a majority of the shares of the corporation
represented in person or by proxy at such meeting (provided that a lawful quorum
of shareholders is represented in person or by proxy) shall be as valid and as
-4-
<PAGE>
binding upon the corporation and upon all the shareholders, as though it had
been approved or ratified by every shareholder of the corporation, whether or
not the contract or act would otherwise be open to legal attack because of the
directors' interest, or for any other reason.
TENTH. The corporation, by resolution or resolutions of its Board of
Directors, shall have power to create and issue, whether or not in connection
with the issue and sale of any shares or any other securities of the
corporation, warrants, rights, or options entitling the holders thereof to
purchase from the corporation any shares of any class or classes or any other
securities of the corporation, such warrants, rights, or options to be evidenced
by or in such instrument or instruments as shall be approved by the Board of
Directors. The terms upon which, the time or times, which may be limited or
unlimited in duration, at or within which, and the price or prices (not less
than the minimum amount prescribed by law, if any) at which any such warrants,
rights, or options may be issued and any such shares or other securities may be
purchased from the corporation upon the exercise of any such warrant, right, or
option shall be such as shall be fixed and stated in the resolution or
resolutions of the Board of Directors providing for the creation and issue of
such warrants, rights, or options. The Board of Directors is hereby authorized
to create and issue any such warrants, rights, or options from time to time for
such consideration, and to such persons, firms, or corporations, as the Board of
Directors may determine.
-5-
<PAGE>
ELEVENTH. The corporation shall indemnify any and all persons who may serve
or who have served at any time as directors or officers, or who at the request
of the Board of Directors of the corporation may serve or at any time have
served as directors or officers of another corporation in which the corporation
at such time owned or may own shares of stock or of which it was or may be a
creditor, and their respective heirs, administrators, successors, and assigns,
against any and all expenses, including amounts paid upon judgments, counsel
fees, and amounts paid in settlement (before or after suit is commenced),
actually and necessarily incured by such persons in connection with the defense
or settlement of any claim, action, suit, or proceeding in which they, or any of
them, are made parties, or a party, or which may be asserted against them or any
of them, by reason of being or having been directors or officers or a director
or officer of the corporation, or of such other corporation, except in relation
to matters as to which any such director or officer or former director or
officer or person shall be adjudged in any action, suit, or proceeding to be
liable for his own negligence or misconduct in the performance of his duty. Such
indemnification shall be in addition to any other rights to which those
indemnified may be entitled under any law, bylaw, agreement, vote of
stockholders, or otherwise.
TWELFTH. Meetings of stockholders may be held outside the State of Nevada,
if the by-laws so provide. The books of the corporation may be kept (subject to
any provision contained in the statutes) outside the State of Nevada at such
place or places as may be designated from time to time by the Board of Directors
or in the by-laws of the corporation.
-6-
<PAGE>
THIRTEENTH. This corporation reserves the right to amend, alter, change or
repeal any provision contained in the articles of incorporation, in the manner
now or hereafter prescribed by statute, or by the articles of incorporation, and
all rights conferred upon stockholders herein are granted subject to this
reservation.
I, THE UNDERSIGNED, being the incorporator hereinbefore named, for the
purpose of forming a corporation pursuant to the General Corporation Law of the
State of Nevada, do make and file these articles of incorporation, hereby
declaring and certifying that the facts herein stated are true, and accordingly
have hereunto set my hand this 29th day of May, 1986.
/s/ Suzy Frost
-----------------------------
SUZY FROST
STATE OF NEVADA
COUNTY OF
On this 29th day of May, 1986, before me, a Notary Public, personally
appeared Suzy Frost, who severally acknowledged that they executed the above
instrument.
- -----------------------------------
[ILLEGIBLE INFORMATION IN A BOX
- -----------------------------------
/s/ [ILLEGIBLE]
-----------------------------
NOTARY PUBLIC
-7-
<PAGE>
- ------------------------------------------
STATE OF NEVADA
DEPARTMENT OF
STATE
I hereby certify that this is a
true and complete copy of the document
as filled in this office.
DATED: MAY 29 1986
/s/ Wm. D. Swackhamer
WM. D. SWACKHAMER
Secretary of State
BY /s/ Nancy McCain
- ------------------------------------------
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
JUL 18 1994
No. 3652-86
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
(After Issuance of Stock) Filed by:
RUE DE RIVOLI PERFUMERIES OF AMERICA, LTD
- --------------------------------------------------------------------------------
Name of Corporation
and the undersigned Charles Ellington III and
- --------------------------------------------------------------------------------
President or Vice President
EJ Rothchild of RUE DE RIVOLI PERFUMERIES OF AMERICA, LTD
- --------------------------------------------------------------------------------
Secretary or Assistant Secretary Name of Corporation
do hereby certify:
That the Board of Directors of said corporation at a meeting duly convened,
held on the 13th day of July, 1994, adopted a resolution to amend the original
articles as follows:
The amount of the total authorized Capital Common Stock of the Corp. is
50,000,000 with a par value of $.001
The number of shares of the corporation outstanding and entitled to vote on
an amendment to the Articles of Incorporation is 8,740,000, that the said
change(s) and amendment have been consented to and approved by a majority vote
of the stockholders holding at least a majority of each class of stock
outstanding and entitiled to vote thereon.
/s/ Charles Ellington III
-------------------------------
President or Vice President
/s/ EJ Rothchild
-------------------------------
Secretary or Assistant Secretary
RECEIVED
JUL 15 1994
Secretary of State
State of Utah )
County of Salt Lake )ss.
On July 13, 1994, personally appeared before me, a Notary Public, Charles
Ellington and EJ Rothchild, who acknowledged that they executed the above
instrument.
/s/ [ILLEGIBLE]
------------------------
Signature of Notary
[NOTARY SEAL]
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE C44869 DF
STATE OF NEVADA E75678
NOV 21 1994
[ILLEGIBLE], SECRETARY OF STATE
/s/ [ILLEGIBLE]
No. 3652-86
CERTIFICATE OF AMENDMENT OF INCORPORATION
after issuance of stock
RUE DE RIVOLI PERFUMERIES OF AMERICA LTD.
Name of Corporation
We the undersigned CHARLES ELLINGTON III, PRESIDENT and
E.J. ROTHCHILD, SECRETARY of RUE DE RIVOLI PERFUMERIES OF AMERICA LTD., do
hereby certify:
THAT THE BOARD OF DIRECTORS OF SAID CORPORATION AT A MEETING CONVENED, HELD
ON THE 10TH DAY OF NOV., 1994, ADOPTED A RESOLUTION TO AMEND THE ORIGINAL
ARTICLES AS FOLLOW:
ARTICLE I IS HEREBY AMENDED TO READ AS FOLLOWS:
THE NAME OF THE CORPORATION IS
"ENVIRO SOLUTIONS INTERNATIONAL, INC.:"
THE NUMBER OF SHARES OF THE CORPORATION OUTSTANDING G AND ENTITLED TO VOTE
ON AN AMENDMENT TO THE ARTICLES OF INCORPORATION IS 6,508,740, THAT THE SAID
CHANGE(S) AND AMENDMENT HAVE BEEN CONSENTED TO AND APPROVED BY A MAJORITY VOTE
OF THE STOCKHOLDERS HOLDING AT LEAST A MAJORITY OF EACH CLASS OF STOCK
OUTSTANDING AND ENTITLED TO VOTE THEREON.
/s/ Charles Ellington III
PRESIDENT
SECRETARY
/s/ E.J. Rothchild
STATE OF UTAH
COUNTRY OF SALT LAKE
ON [ILLEGIBLE] 1994, PERSONALLY APPEARED BEFORE ME A NOTARY PUBLIC,
Charles Ellington III E.J. Rothchild,
(NAMES APPEARING AND SIGNING DOCUMENT)
WHO ACKNOWLEDGED THAT THEY EXECUTED THE ABOVE INSTRUMENT.
/s/ [ILLEGIBLE]
SIGNATURE OF NOTARY
- -------------------------------------
NOTARY PUBLIC
SHELLIE MANZANARES
[SEAL] 4461 Mt. Tuscanora Dr. #309
Murray, UT 84123
My Commssion Expires
May 8, 1998
STATE OF UTAH
- -------------------------------------
RECEIVED
(ILLEGIBLE)
NOV 21, 1994
Secretary of State
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
FILED (After Issuance of Stock) Filed by:
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
NOV 22 1995
3652-86
DEAN HELLER SECRETARY OF STATE
/s/ Dean Heller
ENVIRO SOLUTIONS INTERNATIONAL, INC. C-30841
----------------------------------------------------
Name of Corporation
BRENT CARROLL GUTIERREZ
We the undersigned------------------------------------------- and
President or Vice President
No ANITA K. GUTIERREZ of ENVIRO SOLUTIONS INTERNATIONAL, INC.
- ------------------------------ -----------------------------------------
Secretary or Assistant Secretary Name of Corporation
do hereby certify
That the Board of Directors of said corporation at a meeting duly convened
held on the 1st day of NOVEMBER, 1995 adopted a resolution to amend the
original articles as follows:
Article 1 is hereby amended to read as follows:
INTERNATIONAL CUSTOM PACK, INC.
NOV 22 1995
The number of shares of the corporation outstanding and entitled to vote on
an amendment to the Articles of Incorporation is 10,005,590 that the said
change(s) and amendment have been consented to and approved by a majority vote
of the stockholders holding at least a majority of each class of stock
outstanding and entitled to vote thereon.
/s/ Brent Gutierrez, President
-------------------------------
President or Vice President
/s/ Anita Gutierrez, Secretary
-------------------------------
Secretary or Assistant Secretary
State of Mississippi)
)ss.
County of Harrison )
On November 21, 1995, personally appeared before me, a Notary Public
Brent Gutierrez and Anita Gutierrez who acknowledged
that they executed the above instrument.
/s/ Kelly Anne [ILLEGIBLE]
-------------------------------
Signature of Notary
NOTARY PUBLIC STATE OF MISSISSIPPI AT LARGE,
MY COMMISSION EXPIRES May 9, 1999.
BONDED THRU NOTARY PUBLIC UNDERWRITERS
(NOTARY STAMP OR SEAL)
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
NOV 25 1997
No. C 3652-86
/s/ Dean Heller
DEAN HELLER, SECRETARY OF STATE
CERTIFICATE OF AMENDMENT TO THE
ARTICLES OF INCORPORATION OF INTERNATIONAL CUSTOM PACK, INC.
***********************
INTERNATIONAL CUSTOM PACK, INC., a Nevada corporation (the "Corporation"),
hereby certifies as follows:
1. The capitalization of the Corporation is modified to (a) increase
the number of authorized shares of the Corporation's single class of common
voting stock, $.001 par value, from 25,000,000 to 50,000,000 shares, and
(b) authorize the future issuance of up to 25,000,000 shares of preferred
stock, $.001 par value, in one or more separate series hereafter to be
established by director resolution or written action, each of which may
contain different designations, preferences, limitations, restrictions and
relative rights and shall be evidenced by a certificate of designations
which shall be filed with the office of the Nevada Secretary of State; and
Article Fourth of the Corporation's Articles of Incorporation is hereby
deleted in its entirety and there is substituted in lieu thereof, also to
be designated Article Fourth, the following material:
"FOURTH. The aggregate number of shares of capital stock
authorized to be issued by the Corporation shall be 50,000,000 shares
of common stock, each with a par value of $.001 (the "Common Stock"),
and 25,000,000 shares of preferred stock, each with a par value of
$.001 (the "Preferred Stock"). Each share of issued and outstanding
Common Stock shall entitle the holder thereof to fully participate in
all shareholder meetings, to cast one vote on each matter with respect
to which shareholders have the right to vote, and to share ratably in
all dividends and other distributions declared and paid with respect
to the Common Stock, as well as in the net assets of the Corporation
upon liquidation or dissolution, but each such share shall be subject
to the rights and preferences of the Preferred Stock as hereinafter
set forth.
The Preferred Stock may be issued from time to time in one or
more series in any manner permitted by law, as determined from time to
time by the Board of Directors and stated in any resolution providing
for the issuance of such shares adopted by the Board of Directors
pursuant to authority hereby vested in it, each series to be
appropriately designated, prior to the issuance of any shares thereof,
by some distinguishing letter, number or title. All shares of each
series of Preferred Stock shall be alike in every particular and of
equal rank, have the same powers, preferences and rights and be
subject to the same qualifications, limitations and restrictions,
without distinction between the shares of different series thereof,
except in regard to the following particulars, which may differ as to
different series:
(a) the periodic or other rate of dividends payable and the
dates from which such dividends shall commence to accrue, if at
all;
(b) the manner in which, if at all, shares of a particular
series may be redeemed and the amount payable upon a share
redemption;
<PAGE>
(c) the amount payable upon any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation;
(d) the provisions of any sinking fund established with
respect to the shares of a series;
(e) the terms and rates of conversion or exchange, if shares
of a series are convertible or exchangeable; and
(f) the provisions as to voting rights, if any, associated
with shares of a series.
Before any shares of a particular series of Preferred Stock are
issued, the designations of such series and its terms in respect of
the foregoing particulars shall be fixed and determined by the Board
of Directors in any manner permitted by law and stated in a resolution
providing for the issuance of such shares adopted by the Board of
Directors pursuant to authority hereby vested in it. Such designations
and terms shall be set forth in full or summarized in the certificate
for such series. The Board of Directors may increase the number of
such shares by providing that any unissued shares of Preferred Stock
shall constitute part of such series, or may decrease (but not below
the number of shares thereof then outstanding) the number of shares of
any series of Preferred Stock already created by providing that any
unissued shares previously assigned to such series shall no longer
constitute part thereof. The Board of Directors is hereby empowered to
classify or reclassify any unissued shares of Preferred Stock by
fixing or altering the terms thereof in respect of the
above-referenced particulars and by assigning the same to an existing
or newly established series from time to time before the issuance of
such shares.
The holders of shares of each series shall be entitled to
receive, out of any funds legally available therefor, when and as
declared by the Board of Directors, cash dividends at such rate per
annum as shall be fixed by resolution of the Board of Directors for
such series, payable periodically on the dates fixed by the Board of
Directors for the series. Such dividends may be cumulative or
non-cumulative, deemed to accrue from day to day regardless of whether
or not earned or declared, and may commence to accrue on each share of
Preferred Stock from such date or dates, all as may be determined and
stated by the Board of Directors prior to the issuance thereof. The
Corporation shall make dividend payments ratably upon all outstanding
shares of Preferred Stock in proportion to the amount of dividends
accrued thereon to the date of such dividend payment, if any.
As long as any shares of Preferred Stock shall remain
outstanding, no dividend (other than a dividend payable in shares
ranking junior to such Preferred Stock with respect to the payment of
dividends or liquidating assets) shall be declared or paid upon, nor
shall any distribution be made or ordered in respect of, shares of the
Common Stock
2
<PAGE>
or any other class of shares ranking junior to the shares of such
Preferred Stock as to the payment of dividends or liquidating assets,
nor shall any monies (other than the net proceeds received from the
sale of shares ranking junior to the shares of such Preferred Stock as
to the payment of dividends or liquidating assets) be set aside for or
applied to the purchase or redemption (through a sinking fund or
otherwise) of shares of the Common Stock or of any other class of
shares ranking junior to the shares of such Preferred Stock as to
dividends or assets unless:
(a) all dividends accrued with respect to the shares of
Preferred Stock of all series for past dividend periods shall
have been paid and the full dividend on all outstanding shares of
Preferred Stock of all series for the then current dividend
period shall have been paid or declared and set apart for
payment; and
(b) the Corporation shall have set aside all amounts, if
any, required to be set aside as and for sinking funds, if any,
for the shares of Preferred Stock of all series for the then
current year, and all defaults, if any, in complying with any
such sinking fund requirements in respect of previous years shall
have been cured.
The Corporation, at the option of the Board of Directors, may at
any time redeem the whole, or from time to time any part, of any
series of Preferred Stock, subject to such limitations as may be
adopted by the Board authorizing the issuance of such shares, by
paying therefor in cash the amount which shall have been determined by
the Board of Directors, in the resolution authorizing such series, to
be payable upon the redemption of such shares at such time. Redemption
may be made of the whole or any part of the outstanding shares of any
one or more series, in the discretion of the Board of Directors; but
if the redemption shall be effected only with respect to a part of a
series, the shares to be redeemed may be selected by lot, or all of
the shares of such series may be redeemed pro rata, in such manner as
may be prescribed by resolution of the Board of Directors.
Subject to the foregoing provisions and to any qualifications,
limitations or restrictions applicable to any particular series of
Preferred Stock which may be stated in the resolution providing for
the issuance of such series, the Board of Directors shall have
authority to prescribe from time to time the manner in which any
series of Preferred Stock shall be redeemed.
Upon any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the shares of Preferred
Stock of each series shall be entitled, before any distribution shall
be made with respect to shares of Common Stock or to any other class
of shares junior to the shares of Preferred Stock as to the payment of
dividends or liquidating assets, to be paid the full preferential
amount fixed by the Board of Directors for such series as herein
authorized; and thereafter shall be entitled to such further payment,
if any, as shall be specified in the Board of Director resolution
3
<PAGE>
establishing the series. If upon such liquidation or dissolution of
the Corporation, whether voluntary or involuntary, the net assets of
the Corporation shall be insufficient to permit the payment to all
outstanding shares of Preferred Stock of all series of the full
preferential amounts to which they are respectively entitled, the
entire net assets of the Corporation shall be distributed, in the
order of seniority, fully as to each series with respect to which
there are adequate net assets to satisfy the preferential amount and,
as to the most senior series with respect to which there are
inadequate net assets, ratably in proportion to the full preferential
amount to which each share of that series is entitled. Neither a
consolidation nor a merger of the Corporation with or into any other
entity nor the sale of all or substantially all of the assets of the
Corporation shall be deemed to be a liquidation or dissolution within
the meaning of this paragraph."
. . . . . . . . . . . . .
2. The foregoing amendment shall become effective as of the close of
business on the date this Certificate of Amendment is approved by the office of
the Nevada Secretary of State and all filing fees then due have been paid, all
in accordance with the corporation laws of the State of Nevada.
3. The amendment recited in Section 1. above has been duly adopted in
accordance with the provisions of ss.ss.78.385, .390, .315 and .320, Nevada
Revised Statutes, the Board of Directors of the Corporation having adopted a
resolution setting forth such amendment and declaring its advisability, and the
holders of a majority of the issued and outstanding shares of the Corporation's
single class of common voting stock having approved of such amendment by
executed written action, all as of August 30, 1997.
IN WITNESS WHEREOF, INTERNATIONAL CUSTOM PACK, INC. has caused this
Certificate of Amendment to and Restatement of its Articles of Incorporation to
be prepared under the signature of its President and the acknowledgement of its
Secretary this __th day of August 1997.
Signature Acknowledged by: INTERNATIONAL CUSTOM PACK, INC.
/s/ Clayton F. Gutierrez, Sec. By: /s/ Brent Gutierrez, President
- --------------------------------- ---------------------------------
Clayton F. Gutierrez, Secretary Brent Gutierrez, President
STATE OF MISSISSIPPI
COUNTY OF _________________
Before me, the undersigned authority, this day personally appeared Brent
Gutierrez and Clayton F. Gutierrez, who, being known to me and being placed
under oath, identified themselves, respectively, as the President and Secretary
of International Custom Pack, Inc., a Nevada corporation, and acknowledged the
authenticity of the foregoing Certificate and of their
4
<PAGE>
execution of the same, pursuant to authority vested in each, for the uses and
purposes therein described.
Dated: August 30, 1997 /s/ Tammy Lynn Bosarge
---------------------------------
(signature of notary)
Tammy Lynn Bosarge
---------------------------------
(printed name)
Notary Public, State of Mississippi
My commission expires: 10-19-97
5
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
DEC 22 1998
No. C 3652-86
/s/ Dean Heller
DEAN HELLER, SECRETARY OF STATE
CERTIFICATE OF AMENDMENT
OF
ARTICLES OF INCORPORATION
OF
INTERNATIONAL CUSTOM PACK, INC.
We the undersigned as President and Secretary of International Custom Pack,
Inc. do hereby certify:
That the Board of Directors of International Custom Pack Inc. adopted
a Resolution by written consent to amend the original Articles as follows:
A. Delete Article I in its entirety and substitute in its place
the following:
Article One: The name of the Corporation is Global Seafood
Technologies, Inc.
Said amendment has been consented to and approved by the owners
of majority of the duly issued and outstanding shares of common stock
which represent a majority of the sole class of common stock
outstanding and entitled to vote thereon. The change is effective
immediately upon the filing of this Certificate.
/s/ Brent Gutierrez, President
--------------------------------------
BRENT GUTIERREZ, PRESIDENT
/s/ Anita Gutierrez, Secretary
--------------------------------------
ANITA GUTIERREZ, SECRETARY
STATE OF MISSISSIPPI )
):ss.
COUNTY OF HARRISON )
On this day 15th day of December, 1998, personally appeared before me Brent
Gutierrez and Anita Gutierrez, personally known to me or provided to me on the
basis of satisfactory evidence to be the persons whose names are signed on the
preceding document, and acknowledged to me that they signed it voluntarily for
its stated purpose.
/s/ Tammy Lynn Bosarge
10-19-2001
BY-LAWS
OF
INTERNATIONAL CUSTOM PACK, INC.
ARTICLE I. OFFICES
The principal office of the corporation in the State of Ms. shall be
located in the City of Biloxi, County of Harrison. The corporation may have such
other offices, either within or without the State of Ms., as the Board of
Directors may designate or as the business of the corporation may require from
time to time.
ARTICLE II. SHAREHOLDERS
SECTION 1. Annual Meeting. The annual meeting of the shareholders shall be
held on the Second Monday in the month of February in each year, beginning with
the year 1996, at the hour Of 2:00 o'clock P.M., for the purpose of electing
Directors and for the transaction of such other business as may come before the
meeting. If the day fixed for the annual meeting shall be a legal holiday in the
State of Mississippi, such meeting shall be held on the next succeeding business
day. If the election of Directors shall not be held on the day designated herein
for any annual meeting of the shareholders, or at any adjournment thereof, the
Board of Directors shall cause the election to be held at a special meeting of
the shareholders as soon thereafter as conveniently may be.
SECTION 2. Special Meetings. Special meetings of the shareholders, for any
purpose or purposes, unless otherwise prescribed by statute, may be called by
the President or by the Board of Directors, and shall be called by the President
at the request of the holders of not less than _____ per cent of all
<PAGE>
the outstanding shares of the corporation entitled to vote at the meeting.
SECTION 3. Place of Meeting. The Board of Directors may designate any
place, either within or without the State of Mississippi unless otherwise
prescribed by statute, as the place of meeting for any annual meeting or for any
special meeting called by the Board of Directors. A waiver of notice signed by
all shareholders entitled to vote at a meeting may designate any place, either
within or without the State of Mississippi, unless otherwise prescribed by
statute, as the place for the holding of such meeting. If no designation is
made, or if a special meeting be otherwise called, the place of meeting shall be
the principal office of the corporation in the State of Mississippi.
SECTION 4. Notice of Meeting. Written notice stating the place, day and
hour of the meeting and, in case of special meeting, the purpose or purposes for
which the meeting is called, shall unless otherwise prescribed by statute, be
delivered not less than 3 days nor more than 30 days before the date of the
meeting, either personally or by mail, by or at the direction of the President,
or the Secretary, or the persons calling the meeting, to each shareholder of
record entitled to vote at such meeting. If mailed, such notice shall be deemed
to be delivered when deposited in the United States mail, addressed to the
shareholder at his address as it appears on the stock transfer books of the
corporation, with postage thereon prepaid.
SECTION 5. Closing of Transfer Books or Fixing of Record Date. For the
purpose of determining shareholders entitled to notice of or to vote at any
meeting of shareholders or any adjournment thereof, or shareholders entitled to
receive payment of any
<PAGE>
dividend, or in order to make a determination of shareholders for any other
proper purpose, the Board of Directors of the corporation may provide that the
stock transfer books shall be closed for a stated period but not to exceed, in
any case, _____ days. If the stock transfer books shall be closed for the
purpose of determining shareholders entitled to notice of or to vote at a
meeting of shareholders, such books shall be closed for at least _____ days
immediately preceding such meeting. In lieu of closing the stock transfer books,
the Board of Directors may fix in advance a date as the record date for any such
determination of shareholders, such date in any case to be not more than _____
days and, in case of a meeting of shareholders, not less than _____ days prior
to the date on which the particular action, requiring such determination of
shareholders, is to be taken. If the stock transfer books are not closed and no
record date is fixed for the determination of shareholders entitled to notice of
or to vote at a meeting of shareholders, or shareholders entitled to receive
payment of a dividend, the date on which notice of the meeting is mailed or the
date on which the resolution of the Board of Directors declaring such dividend
is adopted, as the case may be, shall be the record date for such determination
of shareholders. When a determination of shareholders entitled to vote at any
meeting of shareholders has been made as provided in this section, such
determination shall apply to any adjournment thereof.
SECTION 6. Voting Lists. The officer or agent having charge of the stock
transfer books for shares of the corporation shall make a complete list of the
shareholders entitled to vote at each meeting of shareholders or any adjournment
thereof, arranged in alphabetical order, with the address of and the number of
shares
<PAGE>
held by each. Such list shall be produced and kept open at the time and place of
the meeting and shall be subject to the inspection of any shareholder during the
whole time of the meeting for the purposes thereof.
SECTION 7. Quorum. A majority of the outstanding shares of the corporation
entitled to vote, represented in person or by proxy, shall constitute a quorum
at a meeting of shareholders. If less than a majority of the outstanding shares
are represented at a meeting, a majority of the shares so represented may
adjourn the meeting from time to time without further notice. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
noticed. The shareholders present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum.
SECTION 8. Proxies. At all meetings of shareholders, a shareholder may vote
in person or by proxy executed in writing by shareholder or by his duly
authorized attorney in fact. Such proxy shall be filed with the secretary of the
corporation before or at the time of the meeting. No proxy shall be valid after
_____ months from the date of its execution, unless otherwise provided in the
proxy.
SECTION 9. Voting of Shares. Subject to the provisions of Section 12 of
this Article II, each outstanding share entitled to vote shall be entitled to
one vote upon each matter submitted to a vote at a meeting of shareholders.
SECTION 10. Voting of Shares by Certain Holders. Shares standing in the
name of another corporation may be voted by such
<PAGE>
officer, agent or proxy as the by-laws of such corporation may prescribe, or, in
the absence of such provision, as the board of directors of such corporation may
determine.
Shares held by an administrator, executor, guardian or conservator may be
voted by him either in person or by proxy, without a transfer of such shares
into his name. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him without a transfer of such shares into his name.
Shares standing in the name of a receiver may be voted by such receiver,
and shares held by or under the control of a receiver may be voted by such
receiver without the transfer thereof into his name if authority so to do be
contained in an appropriate order of the court by which such receiver was
appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, and
thereafter the pledges shall be entitled to vote the shares so transferred.
Shares of its own stock belonging to the corporation shall not be voted,
directly or indirectly, at any meeting, and shall not be counted in determining
the total number of outstanding shares at any given time.
SECTION 11. Informal Action by Shareholders. Unless otherwise provided by
law, any action required to be taken at a meeting of the shareholders, or any
other action which may be taken at a meeting of the shareholders, may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all of the shareholders entitled to vote with respect to the
subject matter thereof.
<PAGE>
SECTION 12. Cumulative Voting. Unless otherwise provided by law, at each
election for Directors every shareholder entitled to vote at such election shall
have the right to vote, in person or by proxy, the number of shares owned by him
for as many persons as there are Directors to be elected and for whose election
he has a right to vote, or to cumulate his votes by giving one candidate as many
votes as the number of such Directors multiplied by the number of his shares
shall equal, or by distributing such votes on the same principle among any
number of candidates.
ARTICLE III. BOARD OF DIRECTORS
SECTION 1. General Powers; The business and affairs of the corporation
shall be managed by its Board of Directors.
SECTION 2. Number, Tenure and Qualifications. The number of directors of
the corporation shall be three(3). Each director shall hold office until the
next annual meeting of shareholders and until his successor shall have been
elected and qualified.
SECTION 3. Regular Meetings. A regular meeting of the Board of Directors
shall be held without other notice than this by-law immediately after, and at
the same place as, the annual meeting of shareholders. The Board of Directors
may provide, by resolution, the time and place for the holding of additional
regular meetings without other notice than such resolution.
SECTION 4. Special Meetings. Special meetings of the Board of Directors may
be called by or at the request of the President or any two directors. The person
or persons authorized to call special meetings of the Board of Directors may fix
the place for holding any special meeting of the Board of Directors called by
them.
SECTION 5. Notice. Notice of any special meeting shall be given at least 3
days previously thereto by written notice
<PAGE>
delivered personally or mailed to each director at his business address, or by
telegram. If mailed, such notice shall be deemed to be delivered when deposited
in the United States mail so addressed, with postage thereon prepaid. If notice
be given by telegram, such notice shall be deemed to be delivered when the
telegram is delivered to the telegraph company. Any director may waive notice of
any meeting. The attendance of a director at a meeting shall constitute a waiver
of notice of such meeting, except where a director attends a meeting for the
express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened.
SECTION 6. Quorum. A majority of the number of directors fixed by Section 2
of this Article III shall constitute a quorum for the transaction of business at
any meeting of the Board of Directors, but if less than such majority is present
at a meeting, a majority of the directors present may adjourn the meeting from
time to time without further notice.
SECTION 7. Manner of Acting. The act of the majority of the directors
present at a meeting at which a quorum is present shall be the act of the Board
of Directors.
SECTION 8. Action Without A Meeting. Any action that may be taken by the
Board of Directors at a meeting may be taken without a meeting if a consent in
writing, setting forth the action so to be taken, shall be signed before such
action by all of the Directors.
SECTION 9. Vacancies. Any vacancy occurring in the Board of Directors may
be filled by the affirmative vote of a majority of the remaining directors
though less than a quorum of the Board of Directors, unless otherwise provided
by law. A director elected to fill a vacancy shall be elected for the unexpired
term of his
<PAGE>
predecessor in office. Any directorship to be filled by reason of an increase in
the number of directors may be filled by election by the Board of Directors for
a term of office continuing only until the next election of Directors by the
shareholders.
SECTION 10. Compensation. By resolution of the Board of Directors, each
Director may be paid his expenses, if any, of attendance at each meeting of the
Board of Directors, and may be paid a stated salary as director or a fixed sum
for attendance at each meeting of the Board of Directors or both. No such
payment shall preclude any director from serving the corporation in any other
capacity and receiving compensation therefor.
SECTION 11. Presumption of Assent. A director of the corporation who is
present at a meeting of the Board of Directors at which action on any corporate
matter is taken shall be presumed to have assented to the action taken unless
his dissent shall be entered in the minutes of the meeting or unless he shall
file his written dissent to such action with the person acting as the secretary
of the meeting before the adjournment thereof or shall forward such dissent by
registered mail to the Secretary of the corporation immediately after the
adjournment of the meeting. Such right to dissent shall not apply to a Director
who voted in favor of such action.
ARTICLE IV. OFFICERS
SECTION 1. Number. The officers of the corporation shall be a President, a
Vice-President, a Secretary and a Treasurer, each of whom shall be elected by
the Board of Directors. Such other officers and assistant officers as may be
deemed necessary may be elected or appointed by the Board of Directors.
<PAGE>
SECTION 2. Election and Term of Office. The officers of the corporation to
be elected by the Board of Directors shall be elected annually by the Board of
Directors at the first meeting of the Board of Directors held after each annual
meeting of the shareholders. If the election of officers shall not be held at
such meeting, such election shall be held as soon thereafter as conveniently may
be. Each officer shall hold office until his successor shall have been duly
elected and shall have qualified or until his death or until he shall resign or
shall have been removed in the manner hereinafter provided.
SECTION 3. Removal. Any officer or agent may be removed by the Board of
Directors whenever in its judgment, the best interests of the corporation will
be served thereby, but such removal shall be without prejudice to the contract
rights, if any, of the person so removed. Election or appointment of an officer
or agent shall not of itself create contract rights.
SECTION 4. Vacancies. A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, may be filled by the Board
of Directors for the unexpired portion of the term.
SECTION 5. President. The President shall be the principal executive
officer of the corporation and, subject to the control of the Board of
Directors, shall in general supervise and control all of the business and
affairs of the corporation. He shall, when present, preside at all meetings of
the shareholders and of the Board of Directors. He may sign, with the Secretary
or any other proper officer of the corporation thereunto authorized by the Board
of Directors, certificates for shares of the corporation, any deeds, mortgages,
bonds, contracts, or other instruments which the Board of
<PAGE>
Directors has authorized to be executed, except in cases where the signing and
execution thereof shall be expressly delegated by the Board of Directors or by
these By-laws to some other officer or agent of the corporation, or shall be
required by law to be otherwise signed or executed; and in general shall perform
all duties incident to the office of President and such other duties as may be
prescribed by the Board of Directors from time to time.
SECTION 6. Vice-President. In the absence of the President or in event of
his death, inability or refusal to act, the Vice-President shall perform the
duties of the President, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the President. The Vice-President shall
perform such other duties as from time to time may be assigned to him by the
President or by the Board of Directors.
SECTION 7. Secretary. The Secretary shall: (a) keep the minutes of the
proceedings of the shareholders and of the Board of Directors in one or more
books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these By-Laws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation and see
that the seal of the corporation is affixed to all documents the execution of
which on behalf of the corporation under its seal is duly authorized; (d) keep a
register of the post office address of each shareholder which shall be furnished
to the Secretary by such shareholder; (e) sign with the President, certificates
for shares of the corporation, the issuance of which shall have been authorized
by resolution of the Board of Directors; (f) have general charge of the stock
transfer books of the corporation; and (g) in general perform all duties
incident to the office of Secretary and such other duties as
<PAGE>
from time to time may be assigned to him by the President or by the Board of
Directors.
SECTION 8. Treasurer. The Treasurer shall: (a) have charge and custody of
and be responsible for all funds and securities of the corporation; (b) receive
and give receipts for moneys due and payable to the corporation from any source
whatsoever, and deposit all such moneys in the name of the corporation in such
banks, trust companies or other depositaries as shall be selected in accordance
with the provisions of Article V of these By-Laws; and (c) in general perform
all of the duties incident to the office of Treasurer and such other duties as
from time to time may be assigned to him by the President or by the Board of
Directors. If required by the Board of Directors, the Treasurer shall give a
bond for the faithful discharge of his duties in such sum and with such surety
or sureties as the Board of Directors shall determine.
SECTION 9. Salaries. The salaries of the officers shall be fixed from time
to time by the Board of Directors and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
corporation.
ARTICLE V. CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. Contracts. The Board of Directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the corporation, and such authority
may be general or confined to specific instances.
SECTION 2. Loans. No loans shall be contracted on behalf of the corporation
and no evidences of indebtedness shall be issued in its name unless authorized
by a resolution of the Board of Directors. Such authority may be general or
confined to specific instances.
<PAGE>
SECTION 3. Checks, drafts, etc. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
resolution of the Board of Directors.
SECTION 4. Deposits. All funds of the corporation not otherwise
employed shall be deposited from time to time to the credit of the corporation
in such banks, trust companies or other depositaries as the Board of Directors
may select.
ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
SECTION 1. Certificates for Shares. Certificates representing shares of the
corporation shall be in such form as shall be determined by the Board of
Directors. Such certificates shall be signed by the President and by the
Secretary or by such other officers authorized by law and by the Board of
Directors so to do, and sealed with the corporate seal. All certificates for
shares shall be consecutively numbered or otherwise identified. The name and
address of the person to whom the shares represented thereby are issued, with
the number of shares and date of issue, shall be entered on the stock transfer
books of the corporation. All certificates surrendered to the corporation for
transfer shall be canceled and no new certificate shall be issued until the
former certificate for a like number of shares shall have been surrendered and
canceled, except that in case of a lost, destroyed or mutilated certificate a
new one may be issued therefor upon such terms and indemnity to the corporation
as the Board of Directors may prescribe.
SECTION 2. Transfer of Shares. Transfer of shares of the corporation shall
be made only on the stock transfer books of the
<PAGE>
corporation by the holder of record thereof or by his legal representative, who
shall furnish proper evidence of authority to transfer, or by his attorney
thereunto authorized by power of attorney duly executed and filed with the
Secretary of the corporation, and on surrender for cancellation of the
certificate for such shares. The person in whose name shares stand on the books
of the corporation shall be deemed by the corporation to be the owner thereof
for all purposes.
ARTICLE VII. FISCAL YEAR
The fiscal year of the corporation shall begin on the 1st day of April and
end on the 31st day of March in each year.
ARTICLE VIII. DIVIDENDS
The Board of Directors may from time to time declare, and the corporation
may pay, dividends on its outstanding shares in the manner and upon the terms
and conditions provided by law and its articles of incorporation.
ARTICLE IX. CORPORATE SEAL
The Board of Directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words, "Corporate Seal".
ARTICLE X. WAIVER OF NOTICE
Unless otherwise provided by law, whenever any notice is required to be
given to any shareholder or director of the corporation under the provisions of
these By-Laws or under the provisions of the articles of incorporation or under
the provisions of the Business Corporation Act, a waiver thereof in writing,
signed by the person or persons entitled to such notice, whether before or after
<PAGE>
the time stated therein, shall be deemed equivalent to the giving of such
notice.
ARTICLE XI. AMENDMENTS
These By-Laws may be altered, amended or repealed and new By-Laws may be
adopted by the Board of Directors at any regular or special meeting of the Board
of Directors.
<PAGE>
BY-LAWS
OF
RUE DE RIVOLI PERFUMERIES OF AMERICA, LTD.
ARTICLE I
Name of Corporation
Section 1: This corporation shall be known as Rue de Rivoli Perfumeries of
America, Ltd.
ARTICLE II
Offices
Section 1: The principal offices of the corporation will be located at 6121
Lakeside Dr., Suite 250, Reno, Nevada. The corporation may maintain such other
offices as the Board of Directors may designate from time to time.
ARTICLE III
Stockholders
Section 1: The annual meeting of the stockholders shall be held in December of
each year, at a date and time to be specified by the Board of Directors. Said
meeting shall be for the purpose of electing directors for the ensuing year and
for the transaction of such other business as may come before the meeting. If
the election of directors shall not be held on the day designated for the annual
meeting of the stockholders, or at any adjournment thereof the Board of
Directors shall cause the election to be held at a special meeting of the
stockholders as soon thereafter as possible.
Section 2: Special meetings of the stockholders, for any purpose or purposes,
unless otherwise prescribed by Statute, may be called by the President or by the
Board of Directors and shall be called by the President at the request of the
holders of not less than one-tenth of all the outstanding shares of the
corporation entitled to vote at the meeting.
Section 3: The Board of Directors may designate any place within or without the
State of Nevada as the site for any annual or special stockholders meeting. A
waiver of notice signed by all stockholders entitled to vote at a meeting may
designate any place, either within or without the State of Nevada, as the site
for any meeting hereinabove authorized. If no designation is made, the place of
the meeting shall be at the principal office of the corporation in the State of
Nevada.
Section 4: Written or printed notice stating the site, date and time of the
meeting and, in case of a special meeting, the
<PAGE>
purpose or purposes for which the meeting is called, shall be delivered not less
than ten (10) days nor more than sixty (60) days before the date of the meeting,
either personally or by mail, by or at the direction and over the signature of
the President, or the Secretary, or the officer or person calling the meeting,
to each stockholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States mail,
addressed to the stockholder at his address as it appears on the stock transfer
books of the corporation, with postage thereon prepaid.
Section 5: For the purpose of determining stockholders entitled to notice of or
to vote any meeting of stockholders, or any adjournment thereof, or stockholders
entitled to receive payment of any dividend, or in order to make a determination
of stockholders for any other proper purpose, the Board of Directors of the
corporation may provide that the stock transfer books shall be closed for a
stated period, not to exceed twenty (20) days. In lieu of closing the stock
transfer books, the Board of Directors may fix in advance a date as the record
date for any such determination of stockholders, such date in any case to be not
more than sixty (60) days and, in case of a meeting of stockholders, not less
than fifteen (15) days prior to the date on which the particular action
requiring such determination of stockholders is to be taken. If the stock
transfer books are not closed and no record dates fixed for the determination of
stockholders entitled to notice of or to vote, or entitled to receive payment of
a dividend, the date on which notice of the meeting is mailed or the date on
which the resolution of the Board of Directors declaring such dividend is
adopted, as the case may be, shall be the record date for such determination of
stockholders. When a determination of stockholders entitled to vote at any
meeting of stockholders has been made as provided in this section, such
determination shall apply to any adjournment thereof, except where the
determination has been made through the closing of the stock transfer books and
the stated period of closing has expired.
Section 6: The officer or agent having charge of the stock transfer books for
share of the corporation shall make, at least ten (10) days before each meeting
of stockholders, a complete list of the stockholders entitled to vote at such
meeting, or any adjournment thereof, arranged in alphabetical order, with the
address of, and the number of shares held by, each, which list, for a period of
(10) days prior to such meeting, shall be kept on file at the principal office
of the corporation and shall be subject to the inspection of any stockholder
during the meeting.
Section 7: A majority of the outstanding shares of the corporation entitled to
vote, represented in person or by proxy, shall constitute a quorum at a meeting
of stockholders. If less than a majority of the outstanding shares are
represented at a meeting, a majority of the shares so represented may adjourn
the meeting, from time to time without further notice. At such
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<PAGE>
adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally notified. The stockholders present at a duly organized meeting may
continue to transact business until adjournment, notwithstanding the withdrawal
of enough stockholders to leave less than a quorum.
Section 8: At all meetings of stockholders, a stockholder may vote by proxy
which shall be executed in writing by the stockholder or by his duly
authorized attorney in fact. Such proxy shall be filed with the Secretary of
the corporation before or at the time of the meeting. No proxy shall be valid
after six (6) months from the date of its execution, unless otherwise provided
in the proxy or coupled with an interest.
Section 9: Each outstanding share otherwise entitled to vote shall be entitled
to one (1) vote upon each matter submitted to a vote at a meeting of
stockholders. A majority vote of those shares present and voting at a duly
organized meeting shall suffice to defeat or enact any proposal unless the
Statutes of the State of Nevada require a greater-than-majority vote, in which
event the higher vote shall be required for the action to constitute the action
of the corporation.
Section 10: Shares held by an administrator, executor, guardian or conservator
may be voted by him, either in person or by proxy, without the transfer of such
shares into his name. Shares standing in the name of a trustee may be voted by
him, either in person or by proxy, but no trustee shall be entitled to vote
shares held by him without transfer of such shares into his name.
Shares standing in the name of a receiver may be voted by such receiver, and
shares held by or under the control of a receiver may be voted by such receiver
without the transfer thereof into his name if authority to do so be contained in
an appropriate order of the court by which such receiver was appointed.
A stockholder whose shares are pledged shall be entitled to vote such shares
until the shares are transferred into the name of the pledgee, and thereafter
the pledgee shall be entitled to vote the shares so transferred.
Shares of its own stock belonging to the corporation or held by it in a
fiduciary capacity shall not be voted, directly or indirectly, at any meeting,
and shall not be counted in determining the total number of outstanding shares
at any given time.
Section 11.(text cut off)
stockholders, or any other action which may be taken at a meeting of the
stockholders, may be taken without a meeting, if a consent in writing, setting
forth the action so taken, shall be signed by a majority of the stockholders
entitled to vote with respect to the subject matter thereof, unless a
greater-than-majority vote would be required at a duly organized meeting, in
which event said greater-than-majority stockholder approval must be obtained.
3
<PAGE>
Such consent shall be filed with the Minutes of Proceedings.
Section 12: The following order of business shall be observed at all meetings of
the stockholders, so far as practicable:
(a) Calling the roll;
(b) Reading, correcting and approving of minutes of previous meeting;
(c) Reports of officers;
(d) Reports of Committees;
(e) Election of Directors;
(f) Unfinished business;
(g) New business; and
(h) Adjournment.
ARTICLE IV
Board of Directors
Section 1: The business and affairs of the corporation shall be managed by its
Board of Directors.
Section 2: As provided in the Articles of Incorporation, the Board of Directors
shall consist of three (3) persons, but may be increased by resolution of the
Board of Directors. The directors shall hold office until the next annual
meeting of stockholders and until their successor shall have been elected and
qualified. Directors need not be residents of the State of Nevada or
stockholders of the corporation.
Section 3: Directors shall be elected at an annual or special stockholders'
meeting by secret ballot of those stockholders present and entitled to vote, a
plurality of the vote being cast being required to elect. Each stockholder shall
be entitled to one (1) vote for each share of stock owned. If there is but one
(1) nominee for any office, it shall be in order to move that the Secretary cast
the elective ballot to elect the nominee.
Section 4: A regular meeting of the Board of Directors shall be held without
notice, other than this By-Law immediately after, and at the same place as, the
annual meeting of stockholders. The Board of Directors may provide, by
resolution, the day, time and place for the holding of additional regular
meetings without other notice than such resolution. The Secretary of the
corporation shall serve as Secretary for the Board of Directors and shall issue
notices for all meetings as required by the By-Laws; shall keep a record of the
minutes of the proceedings of the meetings of directors; and shall perform such
other duties as may be properly required of him by the Board of Directors.
4
<PAGE>
Section 5: Special meetings of the Board of Directors may be called by or at the
request of the President or any director. The person or persons authorized to
call special meetings of the Board of Directors may fix any place, within or
without the State of Nevada, as the place for holding any special meeting of the
Board of Directors called by them.
Section 6: Notice of any special meeting shall be given at least two (2) days
prior thereto by written notice delivered personally or mailed to each director
at his business address, or by telegram. If mailed, such notice shall be deemed
to be delivered when deposited in the United States mail so addressed, with
postage prepaid thereon. If notice be given by telegram, such notice shall be
deemed to be delivered when the telegram is delivered to the telegraph company.
Any director may waive notice of any meeting. The attendance of a director at a
meeting shall constitute a waiver of notice of such meeting, except where a
director attends a meeting for the express purpose of objecting to the
transaction of any business to be transacted at, nor the purpose of, any regular
or special meeting of the Board of Directors need be specified in the notice or
waiver of such meeting.
Section 7: A majority of the number of directors fixed according to Section 2 of
this Article IV shall constitute a quorum for the transaction of business at any
meeting of the Board of Directors, but if less than such majority is present at
a meeting, a majority of the directors present may adjourn the meeting from time
to time without further notice. Once a quorum has been established at a duly
organized meeting, the Board of Directors may continue to transact corporate
business until adjournment, notwithstanding the withdrawal of enough members to
leave less than a quorum.
Section 8: The act of the majority of the Directors present at a meeting at
which a quorum is present shall be the act of the Board of Directors unless the
Statutes of the State of Nevada require a greater-than-majority vote, in which
case, such greater vote shall be required for the act to be that of the Board of
Directors.
Section 9: Any vacancy occurring in the Board of Directors may be filled by the
affirmative vote of a majority of the remaining directors, though less than a
quorum of the Board of Directors. A director elected to fill a vacancy shall be
elected for the unexpired term of his predecessor in office. Any directorship to
be filled by reason of an increase in the number of directors shall be filled by
election at an annual meeting or at a special meeting of the stockholders called
for that purpose.
Section 10: By resolution of the Board of Directors, the directors may be paid
their expenses, if any, of attendance at each meeting of the Board of Directors,
and may be paid a fixed sum for attendance at each meeting of the Board of
Directors or a stated salary as director. No such payment shall preclude any
director from serving the corporation in any other capacity and
5
<PAGE>
receiving compensation therefor.
Section 11: A director of the corporation who is present at at meeting of the
Board of Directors at which action on any corporate matter is taken shall be
presumed to have assented to the action taken unless his dissent shall be
entered in the minutes of the meeting or unless he shall file his written
dissent to such action with the Secretary of the meeting before the adjournment
thereof or shall express such dissent by written notice sent by registered mail
to the Secretary of the corporation within one (1) day after the adjournment of
the meeting. Such right to dissent shall not apply to a director who voted in
favor of such action.
Section 12: Any action required to be taken at a meeting of the Board of
Directors, or any other action which may be taken at a meeting of the Board of
Directors, may be taken without a meeting if a written consent thereto is signed
by all the members of the Board. Such written consent shall be filed with the
minutes of proceedings of the Board. Any meeting of the Board of Directors may
be held by conference telephone call, with minutes thereof duly prepared and
entered into the Minute Book.
ARTICLE V
Officers
Section 1: The officers of the corporation shall be a President, a
Vice-President, a Secretary, a Treasurer, and a Resident Agent, each of whom
shall be elected by the Board of Directors. Other officers and assistant
officers may be authorized and elected or appointed by the Board of Directors.
Any two (2) or more offices may be held by the same person.
Section 2: The officers of the corporation shall be elected annually by the
Board of Directors at the first meeting of the Board of Directors held after
each annual meeting of the stockholders. If the election of officers shall not
be held at such meeting, such election shall be held as soon thereafter as
convenient. Each officer shall hold office until his successor shall have been
duly elected and shall have qualified or until his death or until he shall
resign or shall be been removed in the manner hereinafter provided. Each officer
shall serve for a term of one (1) year, or until his successor is chosen and
qualified.
Section 3: Any officer or agent elected or appointed by the Board of Directors
may be removed by the Board of Directors whenever in its judgment the best
interests of the corporation would be served thereby, but such removal shall be
without prejudice to the contract rights, if any, of the person so removed.
Section 4: A vacancy in any office because of death, resignation, removal,
disqualification or otherwise, may be
6
<PAGE>
filed by majority vote of the Board of Directors for the unexpired portion of
the term of such office.
Section 5: The President shall preside at all meetings of the directors and the
stockholders and shall have general charge and control over the affairs of the
corporation subject to the Board of Directors. He shall sign or countersign all
certificates, contracts and other instruments of the corporation as authorized
by the Board of Directors and shall perform such other duties as are incident to
his office or are required of him by the Board of Directors.
Section 6: The vice-president shall exercise the functions of the President, in
the President's absence, and shall have such powers and duties as may be
assigned to him from time to time by the Board of Directors.
Section 7: The Secretary shall issue notices for all meetings as required by the
By-Laws, shall keep a record of the minutes of the proceedings of the meetings
of stockholders and directors, shall have charge of the seal and of the
corporate books, and shall make such reports and perform such other duties as
are incident to his office, or properly required of him by the Board of
Directors.
Section 8: The Treasurer shall have the custody of all monies and securities of
the corporation and shall keep regular books of account. He shall disburse the
funds of the corporation in payment of the just demands against the corporation,
or as may be ordered by the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the Board of Directors from time to time as
may be required of him, an account of all his transactions as Treasurer and of
the financial condition of the corporation. He shall perform all duties incident
to this office or which are properly required of him by the Board of Directors.
Section 9: The Resident Agent shall be in charge of the corporation's registered
office, upon whom process against the corporation may be served, an shall
perform, all duties required of him by statute.
Section 10: The salaries of all officers shall be fixed by the Board of
Directors, and may be changed from time to time by a majority vote of the Board
of Directors.
ARTICLE VI
Agreements and Finances
Section 1: The Board of Directors may authorize any officer or officers, agent
or agents, to enter into any contracts or execute and deliver any instrument in
the name of and on behalf of the corporation, and such authority may be general
or confined to specific instances.
7
<PAGE>
Section 2: No loans shall be contracted on behalf of the corporation and no
evidence of indebtedness shall be issued in its name unless authorized by a
resolution of the Board of Directors. Such authority may be general or confined
to specific instances.
Section 3: All checks, drafts or other orders for the payment of money, notes or
other evidences of indebtedness issued in the name of the corporation shall be
signed by such duly authorized officer or officers, or agent or agents of the
corporation and in such manner as shall from time to time be determined by
resolution of the Board of Directors.
Section 4: All funds of the corporation not otherwise employed shall be
deposited from time to time to the credit of the corporation in such banks,
trust companies or other depositories as the Board of Directors may select.
ARTICLE VII
Certificate of Shares
Section 1: Certificates representing shares of the corporation shall be in such
form as shall be determined by the Board of Directors. Such certificates shall
be signed by the President and by the Secretary. All certificates for shares
shall be consecutively numbered or otherwise identified. The name and address of
the person to whom the shares represented thereby are issued, with the number of
shares and date of issue, shall be entered on the stock transfer books of the
corporation. All certificates surrendered to the corporation for transfer shall
be cancelled and no new certificate shall be issued until the former certificate
for a like number of shares shall have been surrendered and cancelled, except in
case of a lost, destroyed or mutilated certificate, a new one may be issued
therefor upon such terms and indemnity to the corporation as the Board of
Directors may prescribe.
Section 2: Transfer of shares of the corporation shall be made only on the stock
transfer books of the corporation by the holder of record thereof or by his
legal representative, who shall furnish proper evidence of authority to
transfer, or by his attorney authorized by power of attorney duly executed and
filed with the Secretary of the corporation, and on surrender for cancellation
of the certificate for such shares. The person in whose name shares stand on the
books of the corporation shall be deemed by the corporation to be the owner
thereof for all purposes, unless otherwise notified by such person in writing.
ARTICLE VIII
Fiscal Year
Section 1: The fiscal year of the corporation shall be fixed by resolution of
the Board of Directors.
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<PAGE>
ARTICLE IX
Seal
Section 1: The corporation may or may not have a corporate seal, as may from
time to time be determined by resolution of the Board of Directors. If a
corporate seal is adopted, it shall have inscribed thereon the name of the
corporation and the words "Corporate Seal" and "Nevada". The seal may be sued by
causing it or a facsimile thereof to be impressed or affixed or in any manner
reproduced.
ARTICLE X
Amendments
Section 1: Those By-Laws may be amended by a majority vote of all the stock
issued and outstanding and entitled to vote at any annual or special meeting of
the stockholders, provided notice of intention to amend shall have been
contained in the notice of the meeting.
Section 2: The Board of Directors, by a majority vote of the entire Board at any
meeting, may amend these By-Laws, including By-Laws adopted by the stockholders.
ARTICLE XI
Indemnification of Directors and Officers
Section 1: Every person who was or is a party to, or is threatened to be made a
part to, or is involved in any action, suit or proceedings, whether civil,
criminal, administrative or investigative, by reason of the fact that he or a
person of whom he is the legal representative is or was a director or officer of
the corporation or is or was serving at the request of the corporation as a
director or officer of another corporation, or as its representative in a
partnership, joint venture, trust or other enterprise, shall be indemnified and
held harmless to the fullest extent legally permissible under the laws of the
State of Nevada from time to time against all expenses, liability and loss,
including attorneys' fees, judgments, fines and amounts paid or to be paid in
settlement, reasonably incurred or suffered by him in connection therewith,
pursuant to NRS 78.151. Such right of indemnification shall be a contract right
which may be enforced in any manner desired by such person.
This indemnification is intended to provide at all times the fullest
indemnification permitted by the laws of the State of Nevada and the corporation
may purchase and maintain insurance on behalf of any person who is or was a
director or officer of the corporation, or is or was serving at the request of
the corporation as a director or officer of another corporation, or as its
representative in a partnership, joint venture, trust or other enterprise
against any liability asserted against such person and incurred in any such
capacity or arising out of such status, whether or not the corporation would
have the power to indemnify such person.
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CERTIFICATE OF SECRETARY
I hereby certify that I am the Secretary of Rue de Rivoli Perfumaries of
America, Inc., and that the foregoing By-Laws were adopted as the By-Laws of the
corporation by the Board of Directors of the corporation on this 11th day of
June, 1986.
IN WITNESS WHEREOF, I have hereunto subscribed my name this 11th day of
June, 1986.
/s/ [ILLEGIBLE]
---------------------------
<PAGE>
BY-LAWS
OF
CUSTOM PACK, INC.
ARTICLE I
Offices
Section 1. The principal office of the corporation is 600 East Bayview
Avenue, Biloxi, Mississippi 39530.
Section 2. The corporation may also have such other offices at such other
places as the Board of Directors may from time to time determine or the business
of the corporation may require.
ARTICLE II
Stockholders Meetings
Section 1. All meetings of the stockholders for the transaction of business
shall be held at the principal office of the corporation as above designated, or
at such place within or without the State as may be designated.
Section 2. The annual meeting of stockholders shall be held at the
principal office of the corporation or at such other place as may be designated
on the second Monday of February each year. If such Monday be a legal holiday,
said annual meeting shall be held on the next succeeding business day following.
Section 3. Three days' notice shall be given by the Secretary to the
stockholders prior to each annual meeting. Said notice may be given in person or
by mail, and, if by mail, the address that appears on the books of the
corporation may be used. Attendance by all extant stockholders constitutes a
waiver of said notice. Any form of communication authorized under the laws of
the State of Mississippi may be utilized for providing such notice.
Section 4. Special meetings of the stockholders shall be called by the
President upon the request of a majority of the directors or of the stockholders
owning a majority of the stock outstanding and entitled to vote. Such request
shall state the time, place, and purpose of the meetings.
Section 5. Written notice of a special stockholders' meeting shall be given
at least three (3) days in advance thereof. Such meeting may be held at any time
upon waiver of notice by all of the stockholders. Attendance by all extant
stockholders shall constitute a valid waiver of any notice that may otherwise be
required. Any form of communication authorized
<PAGE>
under the laws of the State of Mississippi may be utilized for providing such
notice.
Section 6. The holders of a majority of the stock issued and entitled to
vote, present in person or represented by proxy, will be requisite and
constitute a quorum at all meetings of the stockholders for the transaction of
business.
Section 7. Business transacted at special meetings shall not be confined to
the objects of the call.
Section 8. When a quorum is present at any meeting, the vote of the holders
of a majority of the stock present in person or by proxy shall decide any
questions brought before such meeting unless the question is such that a
different vote is required by statute or by the charter of incorporation.
Section 9. Each stockholder shall be entitled to one (l) vote for every
share of capital stock standing in his name on the books of the corporation, and
such vote may be cast either in person or by proxy.
ARTICLE III
Directors
Section 1. The business affairs and property of this corporation shall be
managed by a Board of Directors consisting of four (4) members who shall serve
for one (l) year and may succeed themselves. The directors shall be elected at
the annual meeting of the stockholders, and each such director shall be elected
to serve until his successor shall be elected and shall qualify. Three members
of the Board shall constitute a quorum for the transaction of business, and a
quorum shall be sufficient to pass any measure before the meeting. Directors
need not be stockholders. The initial directors of the corporation shall hold
office until the next annual meeting of the stockholders following their
appointment.
Section 2. In the event of a vacancy on said Board of Directors, a majority
of the members of the Board may fill such vacancy by a majority vote, and such
elections shall be good until the next annual or special meeting of the
stockholders. Additional members may in like manner be added to said Board.
Section 3. All of the books of the corporation shall be kept at the
principal office of the corporation or at such other place as the directors may
determine from time to time, and said books shall be open at all times to the
stockholders and directors for their inspection.
Section 4. The President and Secretary shall act as Chairman and Secretary,
respectively, of the Board of Directors.
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Section 5. At all meetings of the Board of Directors, each director shall
be entitled to one (l) vote.
ARTICLE IV
Meetings of the Board
Section 1. Regular meetings of the Board of Directors shall be held
immediately following the annual meeting of stockholders and at such time as
shall be determined by the Board of Directors. No notice shall be required for
regular meetings.
Section 2. Special meetings of the Board of Directors may be called by the
President or any two (2) members of the Board of Directors. Notice of any
special meetings of the Board of Directors shall be given at least two (2) days
prior thereto either personally, by mail, or by any other form of communication
authorized under the laws of the State of Mississippi for such purpose.
Section 3. All regular or special meetings shall be held at the principal
office of the corporation or at such other places, within or without the state,
as the Board may designate.
ARTICLE V
Notices
Section 1. Notices for a stockholders' or director's meeting shall, in all
cases, be sufficient if notice in writing is mailed to the director or
stockholder at the last address known to the corporation at least two (2) days
in advance of any meeting and shall in no wise be deemed to require personal
notice unless otherwise provided in these By-Laws. In addition, any form of
communication authorized under the laws of the State of Mississippi may be
utilized to provide such notice.
Section 2. In all cases, notice requirements may be waived and written
waiver of notice shall be sufficient whether signed before or after the meeting
to which said notice is applicable and, if said meeting is attended by the full
membership of the particular body meeting, said written waivers are not
necessary.
ARTICLE VI
Officers
Section 1. The President shall be the chief executive of the corporation;
he shall preside at all meetings of the stockholders and directors and shall
have general and active management of the business of the corporation and shall
see that all resolutions and orders of the Board are carried into effect. He
shall make and execute all agreements and contracts in the name of the
corporation as authorized by the Board of Directors
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under the seal of the corporation. He shall execute and also carry out all other
duties as are required by law and as may be from time to time assigned to him by
the Board of Directors.
Section 2. The President and other officers of the corporation may be
appointed and their duties assigned and compensation fixed by the Board of
Directors.
Section 3. The Vice-President of this corporation, if any, shall generally
assist the President and shall perform such duties as may be assigned to him by
the Board of Directors. In the event of the death, resignation, absence, or
inability to act of the President, the Vice-President shall assume and discharge
pro tempore the powers and duties of the President of this corporation.
Section 4. The Secretary shall be ex officio secretary of the Board of
Directors. He shall keep the minutes of all meetings of the Board of Directors
and shareholders. He shall have charge of the corporate books and records. He
shall keep in safe custody the seal of this corporation, and, when authorized by
the Board of Directors, shall affix the seal to any instrument requiring the
same. He shall be authorized to sign certificates of stock with the President
and Vice-President. He shall keep accounts of stock registered and transferred
in the manner prescribed by law. He shall give and serve all notices to the
shareholders and directors.
Section 5. The Treasurer shall have the care and custody of and be
responsible for all the funds, securities, evidences of indebtedness, and other
valuable documents of the corporation, and deposit all such funds in the name of
the corporation in such banks, or trust companies, or other depositories, or in
such safe deposit vaults as the Board of Directors may designate.
ARTICLE VII
Certificates of Stock
Section 1. Certificates of stock shall be numbered as issued and shall
exhibit the holder's name and number of shares. They shall be signed by the
President and sealed with the seal of the corporation in a form approved by the
Board of Directors and in accordance with law.
Section 2. They shall be transferred by delivery of the certificate
endorsed either in blank or to a specified person by the person appearing by the
certificate to be the owner of the shares represented thereby, or by delivery of
the certificate and a separate document containing a written assignment of the
certificate, or a power of attorney to sell, transfer the same or the shares
represented thereby signed by the person appearing by the certificate to be the
owner of the shares represented
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thereby. Such assignment or power of attorney may be either in blank or to a
specified person.
Section 3. In case a stockholder shall desire to sell his shares of stock,
he must first offer them for sale at book value to the remaining stockholders,
it being the intention hereof to give them a preference in the purchase of same,
and any attempted sale in violation of this provision is null and void.
A stockholder desiring to sell his stock shall file notice in writing of
his intention with the Secretary of the corporation stating the terms of sale,
and, unless his terms are accepted by any and all of the other stockholders
within thirty (30) days thereafter, they shall be deemed to have waived their
privilege of purchasing, and he be at liberty so to sell to anyone else.
ARTICLE VIII
Lost Certificates
Section 1. The Board of Directors may direct a new certificate or
certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost or destroyed
upon the making of an affidavit by such person claiming the certificate to have
been lost or destroyed.
ARTICLE IX
CONTRACTS, CHECKS, DRAFTS,
BANK ACCOUNTS, ETC.
Section 1. Execution of Contracts. The Board of Directors, except as otherwise
provided in these By-laws, may authorize any officer or officers, employee or
employees, agent or agents, of the Corporation to enter into any contract or
execute and deliver any instrument in the name of and on behalf of the
Corporation, and such authority may be general or confined to specific
instances, and unless so authorized by the Board of Directors, no officer, agent
or employee shall have any power or authority to bind the Corporation.
Section 2. Loans. No loans shall be contracted on behalf of the Corporation and
no negotiable papers shall be issued in its name unless authorized by the Board
of Directors. When so authorized, any officer, employee or agent of the
Corporation may effect loans and advances at any time for the Corporation from
any bank, trust company, or other institution or from any firm, corporation, or
individual; and for such loans and advances may make, execute and deliver
promissory notes or other evidences of indebtedness of the Corporation; and when
authorized as aforesaid, as security for the payment of any and all of the
aforesaid loans, advances, indebtedness and liabilities of the
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Corporation, such person may mortgage, pledge, hypothecate, or transfer any real
or personal property at any time held by the Corporation, and to that end may
execute instruments of mortgage or pledge or otherwise transfer said property.
Such authority may be general or confined to specific instances.
Section 3. Checks, Drafts, Etc. All checks, drafts, or other orders for the
payment of money, notes, or other evidences of indebtedness issued in the name
of the Corporation shall be signed by such person or persons in such manner as
shall from time to time be designated by the Board of Directors.
Section 4. Deposits. All funds of the Corporation shall be deposited from time
to time to the credit of the Corporation under such conditions and in such
banks, trust companies, or other depositories as the Board of Directors may
designate or as may be designated by an officer or officers, agent or agents, of
the Corporation to whom such power may from time to time be delegated by the
Board of Directors, and for the purpose of such deposit any person or persons to
whom such power is so delegated may endorse, assign and deliver checks, drafts,
and other orders for the payment of money which are payable to the order of the
Corporation.
ARTICLE X
Seal
Section 1. The Directors shall provide a suitable corporate seal which
shall be in the charge of the Secretary and used as authorized by the Board of
Directors.
ARTICLE XI
Amendments
Section 1. The shareholders may make, amend, and repeal the By-Laws of the
corporation at any annual meeting or at the special meeting called for the
purpose, and all by-Laws made by the Directors may be altered or repealed by the
shareholders by a majority vote of the issued and outstanding capital stock.
Subject as aforesaid, the Board of Directors shall have power to make, amend,
and repeal the By-Laws of the corporation by vote of a majority of all the
directors at any regular or special meeting of the board. Any additions or
amendments of these By-Laws shall not be effective until they are set down in
writing and physically appended to these By-Laws as a part thereof.
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BY-LAWS OF
COMAR FOODS, INC.
ARTICLE I
SHAREHOLDERS' MEETINGS
Section 1. Place of Meetings. All meetings of the shareholders shall be
held at the office of the Corporation in the State of Alabama, or elsewhere, as
may be designated from time to time by the Board of Directors.
Section 2. Annual Meetings. The annual meeting of the shareholders shall be
held an the second (2nd) Monday in the month of January in each year (exclusive
of the year of incorporation if such date would occur within six (6) months
after the date of incorporation), if not a legal holiday, and if a legal
holiday, then on the next succeeding business day, at the hour of 1:00 P.M.
local time, at which time the shareholders shall elect a Board of Directors,
consider reports of the affairs of the Corporation, and transact such other
business as may be brought before the meeting.
Section 3. Special Meetings. Special meetings of the shareholders, for any
purpose or purposes whatsoever, may be called at any time by the President, or
by the Board of Directors, or by any two or more members thereof, or by one or
more shareholders holding not less than 20% of the voting power of the
corporation.
Section 4. Notice of Meetings. Notices of meetings, annual or special,
shall be given in writing to shareholders entitled to vote by the Secretary or
the Assistant Secretary, or if there be no such officer, or in the case of his
neglect or refusal, by the officer or person calling the meeting.
Such notices shall be sent to the shareholder's address appearing on the
books of the Corporation, or supplied by him to the corporation, not less than
ten (10) days before the date of the meeting.
Notice of any meeting of shareholders shall specify the place, day and hour
of the meeting, and in case of a special meeting, or a meeting which is required
by the Alabama Business corporation Act to be held for any special purpose or of
any annual meeting at which special action is to be taken, such notice shall
also state the purpose or purposes, for which the meeting is called, or the
special action which is proposed to be taken, in such details as may be required
by the applicable provisions of the Alabama Business Corporation Act.
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When a meeting is adjourned for thirty (30) days or more, notice of the
adjourned meeting shall be given as in case of an original meeting. Save, as
aforesaid, it shall not be necessary to give any notice of the adjournment or of
the business to be transacted at an adjourned meeting other than by announcement
at the meeting at which such adjournment is taken.
Section 5. Waiver of Notice by Stockholder. Whenever any notice is required
to be given to any stockholder under the Provisions of the Constitution of the
State of Alabama, the Alabama Business Corporation Act, the Articles of
Incorporation or the By-Laws, a waiver thereof in writing signed by the person
or persons entitled to such notice, whether before or after the time stated
therein or before or after the meeting, shall be equivalent to the giving of
such notice.
Section 6. Action by Shareholders Without Meeting. Any action required by
the Alabama Business Corporation Act to be taken at a meeting of the
shareholders, or any action which may be taken at a meeting of shareholders, may
be taken without a meeting if a consent in writing, setting forth the action
taken, shall be signed by all of the shareholders entitled to vote with respect
to the subject matter thereof. Such consent shall have the same force and effect
as an unanimous vote of shareholders, and may be stated as such in the minutes
and in any writing or documents required to be filed under the Alabama Business
Corporation Act or in any certificate.
Section 7. Quorum. The holders of 51% of the shares entitled to vote
thereat, present in person, or represented by proxy, shall constitute a quorum
at all meetings of the shareholders for the transaction of business except as
otherwise provided by law, by the Articles of Incorporation, or by these
By-Laws. If, however, such quorum shall not be present or represented at any
meeting of the shareholders, the shareholders entitled to vote thereat, present
in person, or by proxy, shall have power to adjourn the meeting from time to
time, until the requisite amount of voting shares shall be present. At such
adjourned meeting at which the requisite amount of voting shares shall be
represented, any business may be transacted which might have been transacted at
the meeting as originally notified.
Section 8. Voting Rights. Only persons in whose names shares entitled to
vote stand on the stock records of the corporation on the day of which notice of
the meeting is mailed, unless some other day be fixed by the Board of Directors
for the determination of shareholders of record, then on such other day, shall
be entitled to vote at such meeting.
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Every shareholder entitled to vote, as provided in the Alabama Business
Corporation Act, shall be entitled to one vote for each share of stock.
Section 9. Proxies. Every shareholder entitled to vote, or to execute
consents, may do so, either in person or by written proxy, filed with the
Secretary of the Corporation, in accordance with the provisions of the Alabama
Business Corporation Act.
ARTICLE II
DIRECTORS / MANAGEMENT
Section 1. Powers. Subject to the limitations of the Articles of
Incorporation, of the By-Laws, and of the limitations and powers of the laws of
the State of Alabama as to action to be authorized or approved by the
shareholders, the business and affairs of this Corporation shall be managed by
the Board of Directors.
Section 2. Number and Qualification. The authorized number of directors of
the Corporation shall be three (3).
Section 3. Election and Tenure of Office. The directors shall be elected at
the annual meeting of the shareholders, to serve for one year and until their
successors are elected and have qualified. Their term of office shall begin
immediately after election.
Section 4. Vacancies. Vacancies in the Board of Directors may be filled by
the affirmative vote of a majority of the remaining directors, though less than
a quorum of the Board of Directors or by a sole remaining director, and each
director so elected shall hold office until his successor is elected at an
annual meeting of shareholders or a special meeting called for that purpose.
The shareholders may at any time elect a director to fill any vacancy not
filled by the directors. The shareholders may elect the additional directors at
the annual meeting at which an amendment of the By-Laws is adopted authorizing
an increase in the number of directors and at a special meeting provided that is
one of the stated purposes given in the notice of the special meetings
If the Board of Directors accepts the resignation of a director tendered to
take effect at a future time, the Board, or the shareholders, shall have power
to elect a successor to take office when the resignation shall become effective.
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No reduction of the number of directors shall have the effect of removing
any director prior to the expiration of his term of office.
Section 5. Removal of Directors. The entire Board of Directors or any
individual director may be removed from office with or without cause at any time
by 100% of the shareholders.
Section 6. Place of Meetings. Meetings of the Board of Director shall be
held at the office of the Corporation in the State of Alabama, or elsewhere,
either within or without the State, as the Board of Directors may from time to
time designate. Any meeting shall be valid, wherever held, if held by the
written consent of all members of the Board of Directors, given either before or
after the meeting and filed with the Secretary of the Corporation,
Section 7. Regular Meeting. The regular meeting of the Board of Directors
shall be held immediately following the adjournment of the annual meetings of
the shareholders without notice.
Section 8. Special Meetings - Notices. Special meetings of the Board of
Directors for any purpose or purposes shall be called at any time by the
President or if he is absent or unable or refuses to act, by any Vice President,
or by any director.
Written notice of the time and place of special meetings shall be delivered
personally to the directors or sent to each director by letter or by telegram,
charges prepaid, addressed to him at his last known address or as it is shown
upon the records of the Corporation, or if it is not shown on such records and
is not readily ascertainable at the place in which the meetings of the directors
are regularly held. In case such notice is mailed or telegraphed, it shall be
deposited in the United States mail or delivered to the telegraph company at
least seventy-two (72) hours prior to the time of the holding of the meeting. In
case such notice is personally delivered as above provided, it shall be so
delivered at least twenty-four (24) hours prior to the time of the holding of
the meeting. Such mailing, telegraphing or personal delivery as above provided
shall be due, legal and personal notice to such director. Attendance of a
director at a meeting shall constitute a waiver of notice of such meeting,
except where a director attends a meeting for the express purpose of objecting
to the transaction of any business because the meeting is now lawfully called or
convened.
Section 9. Waiver of Notice. When all the directors are present at any
directors' meeting, however called or noticed, and signed a written consent
thereto on the records of such
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meeting, or, if a majority of the directors are present, and if those not
present sign in writing a waiver of notice of such meeting, whether prior to or
after the holding of such meeting, which said waiver shall be filed with the
Secretary of the Corporation, the transactions thereof are as valid as if had a
meeting regularly called and noticed.
Whenever any notice is required to be given to any director under the
provisions of the Constitution of the State of Alabama, the Alabama Business
Corporation Act, the Articles of Incorporation or the By-Laws, a waiver thereof
in writing signed by the director or directors entitled to such notice whether
before or after the time stated therein or before or after the meeting, shall be
equivalent to the giving of such notice.
Section 10. Notice of Adjournment. Notice of the time and place of holding
an adjourned meeting need not be given to absent directors if the time and place
be fixed at the meeting adjourned.
Section 11. Quorum. A majority of the number of directors at the time in
office and constituting the then Board of Directors, shall be necessary to
constitute a quorum for the transaction of business, and the action of a
majority of the directors at any meeting at which there is a quorum is valid as
a corporate act; provided that the directors there present in the absence of a
quorum, may adjourn the meeting from time to time but may not transact any other
business.
Section 12. Action of Board Without Meeting. Any action required or
permitted to be taken by the Board of Directors may be taken without a meeting
if all members of the board shall, individually or collectively, consent in
writing to such action.
Section 13. Compensation of Director and Members of Committee. Directors
and members of committees shall receive such compensation for attendance at
meetings as the Board may from time to time prescribe.
ARTICLE III
OFFICERS
Section 1. Officers. The officers of the Corporation shall be a President,
a Vice-President, a Secretary and a Treasurer. The Corporation may also have, at
the discretion of the Board of Directors, a Chairman of the Board, one or more
additional Vice Presidents, or Assistant Vice Presidents, one or more Assistant
Secretaries, one or more Assistant
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Treasurers, and such other officers as may be appointed in accordance with the
provisions of Section 3 of this Article. One person may hold two or more
offices, except those as President and Secretary. However, if the Corporation
has only one shareholder, then that shareholder may hold any number of offices
without exception.
Section 2. Election. The officers of the Corporation, except such officers
as may be appointed in accordance with the provisions of Section 3 or Section 5
of this Article, shall be chosen annually by the Board of Directors, and each
shall hold office until he shall resign or shall be removed or otherwise
disqualified to serve, or his successor shall be elected and qualified. Any
officer may be elected at any time during the year.
Section 3. Subordinate Officers, etc. The Board of Directors may appoint or
may authorize the President to appoint such other officers as the business of
the Corporation may require, each of whom shall hold office for such period,
have such authority and perform such duties as are provided in the By-Laws or as
the Board of Directors may from time to time determine.
Section 4. Removal and Resignation. Any officer may be removed, either with
or without cause, by an unanimous vote of the directors in office, at any
regular or special meeting of the board, or, other than in the case of an
officer chosen by the Board of Directors, by any officer upon whom such power or
removal may be conferred by the Board of Directors.
Any officer may resign at any time by giving written notice to the Board of
Directors or to the President, or to the Secretary of the Corporation. Any such
resignation shall take effect at the date of the receipt of such notice or at
any later time specified therein; and, unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it effective.
Solution 5. Vacancies. A vacancy In any office because of death,
resignation, removal, disqualification or any other cause shall be filled in the
manner prescribed in the By-Laws for regular appointments to such office.
Section 6. Chairman of the Board. The Chairman of the Board, if there shall
be such an officer, shall, if present, preside at all meetings of the Board of
Directors, and exercise and perform such other powers and duties as may be from
time to time assigned to him by the Board of Directors or prescribed by the
By-Laws.
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Section 7. President. Subject to such supervisory power, if any, as may be
given by the Board of Directors to the Chairman of the Board, if there be such
an officer, the President shall be the Chief Executive Officer of the
Corporation and shall, subject to the control of the Board of Directors, have
general supervision, direction and control of the business and officers of the
Corporation. He shall preside at all meetings of the shareholders and in the
absence of the Chairman of the Board, or if there be none, at all meetings of
the Board of Directors. He shall be ex officio a member of all the standing
committees, including the executive committee, if any, and shall have the
general powers and duties of management usually vested in the office of
President of a corporation, and shall have such other powers and duties as may
be prescribed by the Board of Directors or the By-Laws.
Section 8. Vice President. In the absence or disability of the President,
the Vice Presidents in order of their rank as fixed by the Board or Directors,
or if not ranked, the Vice President designated by the Board of Directors, shall
perform all the duties of the President, and when so acting shall all the powers
of, and be subject to, all the restrictions upon, the President. The Vice
Presidents shall have the general powers and duties usually vested in the office
of the Vice President of a Corporation and shall have such other powers and
perform such other duties as from time to time may be prescribed for them
respectively by the Board of Directors or the By-Laws.
Section 9. Secretary. The Secretary shall keep, or cause to be kept, a book
of minutes at the principal office or such other place an the Board of Directors
may order, of all meetings of directors and shareholders, with the time and
place of holding, whether regular or special, and if special, how authorized,
the notice thereof given, and the names of those present at directors' meetings,
the number of shares present or represented at shareholders' meetings and the
proceedings thereof.
The Secretary shall give, or cause to be given, notice of all the meetings
of the shareholders and the Board of Directors required by the By-Laws or by law
to be given, and he shall keep the Seal of the Corporation in safe custody, and
shall have the general powers and perform such other duties as may be prescribed
by the Board of Directors or the By-Laws.
Section 10. Treasurer. The Treasurer shall keep and maintain, or cause to
be kept and maintained, adequate and correct accounts of the properties and
business transactions of the corporation, including accounts of its assets,
liabilities, receipts, disbursements, gains, losses, capital, surplus, and
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shares. The books of account shall be open to inspection by any director at all
reasonable times.
The Treasurer shall deposit all moneys and other valuables in the name of
and to the credit of the Corporation with such depositaries as may be designated
by the Board of Directors. He shall disburse the funds of the Corporation in the
manner as may be ordered by the Board of Directors, whenever they request it, an
account of all of his transactions, as Treasurer and of the financial condition
of the Corporation, and shall have such other powers and perform such other
duties as may be prescribed by the Board of Directors or the By-Laws.
ARTICLE IV
EXECUTIVE AND OTHER COMMITTEES
The Board of Directors may by resolutions, passed by a majority Of the
whole Board, designate an executive committee, and such other committees as may
be desirable from time to time, each committee to consist of two or more of the
directors, with such powers as it may designate, consistent with Articles of
Incorporation and By-Laws and the Alabama Business Corporation Act. Such
committees and the membership thereof shall hold office at the pleasure of the
Board.
ARTICLE V
CORPORATE RECORDS AND REPORTS - INSPECTION
Section 1. Records. The corporation shall maintain adequate and correct
accounts, books, and records of its business and properties. All of such books,
records, and accounts shall be kept at its principal place of business in the
State of Alabama or at such other place as may be fixed by the Board of
Directors from time to time.
Section 2. Inspection of Books and Records. All books and records and
records provided to be kept under the Alabama Business Corporation Act shall be
open to inspection of the directors and shareholders from time to time and in
the manner provided in the Alabama Business Corporation Act.
Section 3. Certification and Inspection of By-Laws. The original or a copy
of these By-Laws, as amended or otherwise altered to date, certified by the
Secretary, shall be open to inspection by the shareholders of the company, as
provided in the Alabama Business Corporation Act.
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Section 4. Checks, Drafts, Etc. All checks, drafts, or other orders for
payment of money, notes or other evidences of indebtedness, issued in the name
of or payable to the Corporation, shall be signed or endorsed by such person or
persons and in such manner as shall be determined from time to time by
resolution of the Board of Directors.
Section 5. Contracts. Etc. - How Executed. The Board of Directors, except
as in the By-Laws otherwise provided, may authorize any officer or officers,
agent or agents, to enter into any contract or execute any instrument in the
name of and on behalf of the Corporation. Such authority may be general or
confined to specific instances. Unless so authorized by the Board of Directors,
no officer, agent, or employee shall have any power or authority to bind the
Corporation by any contract or engagement, or to pledge its credit, or to render
it liable for any purpose or to any amount.
ARTICLE VI
CERTIFICATES AND TRANSFER OF SHARES
Section 1. Certificates for Shares. Certificates for shares shall be of
much form and device as the Board of Directors may designate and shall state
that the Corporation is organized under the Laws of the State of Alabama, the
name of the record holder of the shares represented hereby; its number; date of
issuance; the number of shares for which it in issued; the par value, if any, or
a statement that such shares are without par value; a statement of the
designations, rights, privileges, preferences, and restrictions, if any; a
statement as to the redemption or conversion, if any; a statement of liens or
restrictions upon transfer or voting, if any; if the shares be accessible or, if
assessments are collectible by personal action, a plain statement of such facts.
Every certificate for shares must be signed by the President or a Vice
President and the Secretary or an Assistant Secretary or the Treasurer or an
Assistant Treasurer or must be authenticated by facsimiles of the signatures of
its President and the written signature of its Secretary or an Assistant
Secretary or the Treasurer or an Assistant Treasurer. But should a Transfer
Agent or Registrar be appointed as herein provided, the certificate of shares,
in the discretion of the Board of Directors, may be authenticated by facsimiles
of the signature of any two of the above officers provided the certificate is
countersigned by the Transfer Agent or the Registrar.
Section 2. Transfer on the Books. All transfers of shares of stock shall be
made upon the books by the holder of
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the shares in person or by his lawfully constituted representative upon
surrender of the certificates of shares of stock for cancellation. Upon
surrender to the secretary or Transfer Agent of the Corporation of a certificate
for shares duly endorsed or accompanied by proper evidence of succession,
assignment, or authority to transfer, it shall be the duty of the Corporation to
issue a new certificate to the person entitled thereto, cancel the old
certificate and record the transaction upon the books.
Section 3. Lost or Destroyed Certificates. Any person claiming a
certificate of shares of stock to be lost or destroyed shall make an affidavit
or affirmation of that fact that advertise the same in such manner 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, in at least double the value of the shares of stock
represented by said certificate, thereupon a new certificate may be issued of
the same tenor and for the same number of shares as the one alleged to be lost
or destroyed.
Section 4. Transfer Agents and Registrars. The Board of Directors may
appoint one or more Transfer Agents or Transfer Clerks, and one or more
Registrars, which shall be an incorporated bank or trust company, either
domestic or foreign, who shall be appointed at such times and places as the
requirements of the Corporation may necessitate and the Board of Directors may
designate.
Section 5. Closing Stock Transfer Books. The Board of Directors may close
the transfer books, in their discretion, as provided in the Alabama Business
Corporation Act.
Section 6. Shareholders of Record. The Corporation shall be entitled to
treat the holder of record of any share or shares of stock as the holder in fact
thereof and accordingly shall not be bound to recognize any equitable or other
claim to or interest in such share on the part of any other person whether or
not it shall have express or other notice thereof, save as expressly provided by
the laws of the state of incorporation.
Section 7. Restrictions on Stock Transfers. The ownership and transfer of
shares of stock in this Corporation shall be subject to the following:
(a) If the holder of any shares of stock desires to transfer or dispose of
the same, or any part thereof, to any person who is not at such time a
shareholder, he shall give written notice of such desire to the President,
Vice-President and Secretary of the Corporation, stating the number of shares he
desires to transfer, the name of the
10
<PAGE>
prospective purchaser and the price and terms of the prospective sale. Thereupon
the President, Vice President and Secretary shall promptly notify each
shareholder of the Corporation of the receipt of such notice, and each such
shareholder shall have, for a period of twenty (20) days from the date of
receipt of such notice from the President, Vice President and Secretary, an
option to purchase said shares of stock at the same price and upon the same
terms stated in such notice. It is expressly understood that such notice shall
constitute an offer by the shareholder to each other shareholder to sell such
shares of stock at much price and upon such terms and conditions for such period
of time. Upon receipt by the shareholder making such offer of written notice
from one or more shareholders of acceptance of such offer within such period
time, the parties thereto shall have a reasonable time to close the sale and
purchase thereto. In the event that no written notice of acceptance is received
by the shareholder making such offer from any other shareholder within such
period of time, as provided above, the holder thereof may sell and transfer the
same to the person and at the price and terms stated in such notice, but not
otherwise, but in the event that the sale described in such notice is not
consummated, no subsequent sale shall take place until the shares of stock has
again been offered to the other shareholders in accordance therewith. In the
event that more than one shareholder accepts such offer within such period of
time, the shareholder having the smaller interest in the Corporation shall have
the prior right to purchase such shares of stock until his interest equals that
of the other shareholders accepting such offer, after which such shares of stock
shall be divided equally among shareholders having equal interests in the
corporation, so as to maintain such equality.
(b)(1) In the event of the death, insolvency, bankruptcy, general
assignment by, or transfer of shares of stock by any shareholder without
complying with the provisions of Paragraph 7(a) above, each remaining
shareholder shall have an option, within sixty (60) days after ascertainment of
the identity of the person who received title to such shares of stock by
operation of law or otherwise, to purchase any or all of the shares of stock of
such agreement between the person holding title to such shares of stock and the
shareholder exercising such option, but if no agreement can be reached, then the
price shall be fixed by appraisal as provided in Paragraph 7(b)(2) hereof. Such
option shall be exercised by written notice delivered to the owner of such
shares of stock within such time. In the event that more than one shareholder
exercises such option to buy, the shareholder having the smaller interest in the
Corporation shall have the prior right to purchase such shares or stack until
his interest equals that of the other shareholders accepting such offer, after
which such shares of stock shall be divided equally among
11
<PAGE>
shareholders having equal interests in the Corporation, so as to maintain
equality.
(2) In the event that the shareholder or shareholders electing to acquire
such interest as provided herein, and the owner of the shares of stock of such
deceased, insolvent, bankrupt, or assignor shareholder do not agree upon the
reasonable value of such shares of stock to be acquired within thirty (30) days
after the giving of notice of election to exercise such option by the purchasing
shareholder, either or any of them may demand that the reasonable value of such
shares of stock be determined by the written finding of all of or a majority of
three (3) appraisers, one of whom shall be appointed by the shareholder or
shareholders exercising such election to acquire such shares of stock, one by
the owner of such shares of stock to be acquired, and the third by the first two
chosen. If within ten (10) days after written notice by any party entitled to
appoint an appraiser, the appraiser is not chosen, the party giving such notice
shall forthwith name the three appraisers, who shall act with like effect as if
they had mutually been chosen. Should each of the parties select an appraiser as
hereinabove provided for, and the two appraisers so named fail within twenty
(20) days after their selection to name a third appraiser, then the Senior
United States District Judge for the district in which the Corporation owns
realty (or if none then such Judge in Mobile, Alabama) shall, at the request of
either of the appraisers, name a third appraiser, and the one so named by him
shall act thereunder. If vacancies occur in the appraiser appointed and named
hereunder, such vacancies shall be filled in the name way as the appraiser who
ceased to serve was originally appointed. Should the appraiser fail within a
period of thirty (30) days from the appointment of the third appraiser to return
their findings, three (3) new appraisers shall be named in the same manner as
were chosen the original appraisers. Any expense of such appraiser shall be
borne equally by the shareholder or shareholders exercising such election to
acquire such shares of stock and the owner of such shares of stock to be
acquired.
(c) At any time any shareholder may make, in writing, an offer to any other
shareholder (hereinafter called "offeree") stating the price at which the party
making such offer (hereinafter called "offeror") will buy the shares of stock of
the other or to sell to the other his own shares of stock; and upon receipt of
such notice offeree will have thirty (30) days within which to elect whether
offered will buy from or sell to the offeror at the price stated, which election
shall be in writing delivered to offeror within such period of time. If offeree
fails to elect either to buy or sell within the time specified then offeror
shall have fifteen (15) days after the expiration of the first thirty (30) day
period in which to elect whether offeror will buy or sell at the price stated in
the original notice given by the offeror, which election shall be in writing and
delivered to offered within
12
<PAGE>
said period of time. In case any election herein is made the original offer
together with the election by the offeree or offeror (as the case may be) shall
constitute a binding contract of sale and purchase.
(d) Nothing contained herein shall be construed to prevent any shareholder
of the corporation from pledging his shares of stock as security for a debt or
obligation; but in the event that such pledge is foreclosed, the person
acquiring such shares of stock at such foreclosure shall hold the same subject
to the terms and conditions of this paragraph and shall immediately give the
shareholder of the Corporation notice of such purchase and the opportunity to
exercise their option given above.
(e) Each certificate evidencing ownership of shares of stock in this
Corporation shall contain upon its face or reverse a reference to the terms of
this Section 7 of Article VI of the By-Laws, so as to give notice thereof to all
shareholders and, to any purchaser, general representative, heir, devises,
legatee, pledgee, assignee, receiver, trustee in Bankruptcy, or any other person
holding under or in privity to any shareholder.
ARTICLE VII
CORPORATE SEAL
The Corporate Seal shall be circular in form, and shall have inscribed
thereon the name of the Corporation, the words "Corporate Seal" and the word
"Alabama" or the City's name along with "Alabama" and may or may not have the
year of incorporation.
ARTICLE VIII
AMENDMENTS TO BY-LAWS
Section 1. By Shareholders. New By-Laws may be adopted or these By-Laws may
be repealed or amended at the annual meeting of the shareholders or at any
special meeting of the shareholders called for that purpose, by a vote of
shareholders entitled to exercise a majority of the voting power of the
Corporation, or by written assent by such shareholders.
Section 2. By Directors. Subject to the right of the shareholders to adopt,
amend, or repeal any of these By-Laws, the power to alter, amend, or repeal the
By-Laws or to adopt the By-Laws shall be vested in the Board of Directors,
provided, however, that the Board of Directors may not alter, amend, or repeal
any By-Laws establishing the number of directors, the time or place of
shareholders meetings, or what constitutes a quorum at such shareholders'
meetings.
13
INCORPORATED UNDER THE LAWS OF THE
STATE OF NEVADA
SPECIMEN SPECIMEN SPECIMEN
[SEAL] [SEAL]
CUSIP NO. 37938K 10 4
GLOBAL SEAFOOD TECHNOLOGIES, INC.
50,000,000 AUTHORIZED SHARES $0.001 PAR VALUE NON-ASSESSABLE
THIS CERTIFIES THAT
IS THE RECORD HOLDER OF SPECIMEN SPECIMEN
Shares of GLOBAL SEAFOOD TECHNOLOGIES, INC. Common Stock
transferable on the books of the Corporation by the holder hereof in person or
by duly authorized attorney upon surrender of this Certificate properly
endorsed. This Certificate is not valid until countersigned by the Transfer
Agent and registered by the Registrar.
WITNESS the facsimile seal of the Corporation and the facsimile signatures
of its duly authorized officers.
COUNTERSIGNED AND REGISTERED BY
FIDELITY TRANSFER [ILLEGIBLE] (SALT LAKE CITY, UTAH)
Dated: By
TRANSFER AGENT AND REGISTRAR - AUTHORIZED SIGNATURE
SPECIMEN SPECIMEN
/s/ Anita Gutierrez Brent C. Gutierrez
SECRETARY GLOBAL SEAFOOD TECHNOLOGIES, INC. PRESIDENT
[CORPORATE SEAL]
NEVADA
Exhibit 4.1
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE
UPON THE EXERCISE OF THIS WARRANT ARE TRANSFERABLE
ONLY IN ACCORDANCE WITH PARAGRAPH H HEREOF.
Void after 5:00 P.M., New York Time, on July 1, 2008
Warrant to Purchase
1,000,000 Shares
of Common Stock
WARRANT TO PURCHASE COMMON STOCK
This is to Certify That, FOR VALUE RECEIVED, Equity Advisors, Inc. (the
"Holder"), is entitled to purchase, subject to the provisions of this Warrant,
from International Custom Pack, Inc., a Nevada corporation, having an office at
555 Bayview Avenue, Biloxi, Mississippi 39530 (the "Company"), an aggregate of
1,000,000 shares (the "Warrant Shares") of the Company's Common Stock, 0.001 par
value ("Common Stock") at a price of $1.00 per share (or such other price
computed by applying all adjustments made on or before July 1, 2008, in
accordance with Section F hereof, to $1.00 as if it had been the initial
Exercise Price per share hereunder) at any time on or after November 1, 1998
until 5:00 P.M. New York Time, on July 1, 2008. The number of shares of Common
Stock to be received upon the exercise of this Warrant and the price to be paid
for a share of Common Stock may be adjusted from time to time as hereinafter set
forth. The shares of Common Stock deliverable upon such exercise, and as
adjusted from time to time, are hereinafter sometimes referred to as "Warrant
Shares" and the exercise price of a share of Common Stock in effect at any time
and as adjusted from time to time is hereinafter sometimes referred to as the
"Exercise Price."
A. EXERCISE OF WARRANT. Subject to the following conditions precedent and the
provisions of Section H and I hereof, this Warrant may be exercised in
whole or in part at any time or from time to time on or after November 1,
1998, and before 5:00 P.M. New York Time on July 1, 2008, or, if either
such day is a day on which banking institutions are authorized by law to
close, then on the next succeeding day which shall not be such a day, by
presentation and surrender hereof to the Company at any office maintained
by it, or at the office of its Warrant Agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the
Exercise Price for the number of shares specified in such form. If this
Warrant should be exercised in part only, the Company shall, upon surrender
of this Warrant for cancellation, execute and deliver a new Warrant
evidencing the rights of the Holder hereof to purchase the balance of the
shares purchasable hereunder. Upon receipt by the Company of this Warrant
at its office, or by the Warrant Agent of the Company at its office, in
proper form for exercise, the Holder shall be deemed to be the holder of
record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of the Company shall then be
<PAGE>
closed or that certificate representing such shares of Common Stock shall
not then be actually delivered to the Holder.
B. RESERVATION OF SHARES. The Company hereby agrees that at all times there
shall be reserved for issuance and/or delivery upon exercise of this
Warrant such number of shares of its Common Stock as shall be required for
issuance of delivery upon exercise of this Warrant.
C. FRACTIONAL SHARES. No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant. With respect to
any fraction of a share called for upon exercise hereof, the Company shall
issue to the Holder the next whole share.
D. EXCHANGE, ASSIGNMENT OR LOSS OF WARRANT. This Warrant is exchangeable,
without expense, at the option of the Holder, upon presentation and
surrender hereof to the company or at the office of the Warrant Agent for
other Warrants of different denominations entitling the holder thereof to
purchase in aggregate the same number of shares of Common Stock purchasable
hereunder. The term Warrant as used herein includes any Warrants into which
this Warrant may be divided or exchanged. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction, or
mutilation of this Warrant, and (in the case of loss, theft or destruction)
of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and
deliver a new Warrant of like tenor and date. Any such new warrant executed
and delivered shall constitute an additional contractual obligation on the
part of the Company, whether or not this Warrant so lost stolen, destroyed,
or mutilated shall be at any time enforceable by anyone.
E. RIGHTS OF THE HOLDER. The Holder shall not, by virtue here of, be entitled
to any rights of a shareholder in the Company, either at law or equity, and
the rights of the Holder are limited to those expressed in the Warrant and
are not enforceable against the Company except to the extent set forth
herein.
F. STOCK DIVIDENDS, RECLASSIFICATION, REORGANIZATION, ANTI-DILUTION
PROVISIONS, ETC. This Warrant is subject to the following further
provisions:
1. In case, prior to the expiration of this Warrant by exercise or by its
terms, the Company shall issue any shares of its Common Stock as a
stock dividend or subdivide the number of outstanding shares of Common
Stock into a greater number of shares, then, in either of such cases,
the Exercise Price per share of the Warrant Shares purchasable
pursuant to this Warrant in effect at the time of such action shall be
proportionately reduced and the number of Warrant Shares at that time
purchasable pursuant to this Warrant shall be proportionately
increased. In the event the Company shall contract the number of
outstanding shares of
<PAGE>
Common Stock by combining such shares into a smaller number of shares,
then, in such case, the Exercise Price per share of the Warrant Shares
purchasable pursuant to this Warrant in effect at the time of such
action shall be proportionately increased (but not higher than $2.00
per share) and the number of Warrant Shares at that time purchasable
pursuant to this Warrant shall be proportionately decreased. Any
dividend paid or distributed upon the Common Stock in stock of any
other class of securities convertible into shares of Common Stock
shall be treated as a dividend paid in Common Stock to the extent that
shares of Common Stock are issuable upon the conversion thereof.
2. In case, prior to the expiration of this Warrant by exercise or by its
terms, the Company shall be recapitalized by reclassifying its
outstanding Common Stock, no par value, into stock with a different
par value or by changing its outstanding Common Stock with par value
to stock without par, the Company or a successor corporation shall be
consolidated or merge with or convey all or substantially all of its
or of any successor corporation's property and assets to any other
corporation or corporations (any such corporation being included
within the meaning of the term successor corporation in the event of
any consolidation or merger of any such corporation with, or the sale
of all or substantially all of the property of any such corporation
to, another corporation or corporations), in exchange for stock or
securities of a successor corporation, the holder of this Warrant
shall thereafter have the right to purchase upon the terms and
conditions and during the time specified in this Warrant, in lieu of
the Warrant Shares theretofore purchasable upon the exercise of this
Warrant, the kind and amount of shares of stock and other securities
receivable upon such recapitalization or consolidation, merger or
conveyance by a holder of the number of shares of Common Stock which
the holder of this Warrant might have purchased immediately prior to
such recapitalization or consolidation, merger or conveyance.
3. Upon the occurrence of each event requiring an adjustment of the
Exercise Price and of the number of Warrant Shares purchasable at such
adjusted Exercise Price by reason of such event in accordance with the
provisions of this Section F., the Company shall compute the adjusted
Exercise Price and the adjusted number of Warrant Shares purchasable
at such adjusted Exercise Price by reason of such event in accordance
with the provisions of this Section F. and shall prepare a certificate
setting forth such adjusted Exercise Price and the adjusted number of
Warrant Shares and showing in detail the facts upon which such
conclusions are based. The Company shall mail forthwith to each holder
of this Warrant a copy of such certificate, and thereafter said
certificate shall be conclusive and shall be binding upon such holder
unless contested by such holder by written notice to the Company
within thirty (30) days after receipt of the certificate by such
holder.
<PAGE>
4. In case:
(a) the Company shall take a record of the holders of its Common
Stock for the purpose of entitling them to receive a dividend or
any other distribution in respect of the Common Stock (including
cash), pursuant to without limitation, any spin-off, split-off or
distribution of the Company's assets; or
(b) the Company shall take a record of the holders of its Common
Stock for the purpose of entitling them to subscribe for or
purchase any shares of stock of any class or to receive any other
rights; or
(c) of any classification, reclassification or other reorganization
of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, or conveyance of
all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company;
then, and in any such case, the Company shall mail to the Holder, at
least twenty (20) days prior thereto, a notice stating the date or
expected date on which a record is to be taken for the purpose of such
dividend or distribution of rights, or the date on which such
classification, reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation, or winding up is to take
place, as the case may be. Such notice shall also specify the date or
expected date, if any is to be fixed, as of which holders of Common
Stock of record shall be entitled to participate in said dividend on
distribution of rights, or shall be entitled to exchange their shares
of Common stock for securities or other property deliverable upon such
classification, reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation, or winding up, as the
case may be. The failure to give such notice shall not affect the
validity of any such proceeding or transaction and shall not affect
the right of the holder of this Warrant to participate in said
dividend, distribution of rights, or any such exchange and acquire the
kind and amount of cash, securities or other property as the Holder
would have been entitled to acquire if it was the record holder of the
Warrant Shares which could be obtained upon the exercise of the
Warrants immediately before such proceeding or transaction; provided
that, the Holder exercises the Warrants within 30 days after discovery
that such action or proceeding has taken place.
5. In case the Company at any time while this Warrant shall remain unexpired
and unexercised, shall dissolve, liquidate, or wind up its affairs, the
holder of this Warrant may thereafter receive upon exercise hereof in lieu
of each share of
<PAGE>
Common Stock of the Company which it would have been entitled to receive,
the same kind and amount of any securities or assets as may be issuable,
distributable or payable upon any such dissolution, liquidation or winding
up with respect to each share of Common Stock of the Company.
G. OFFICER'S CERTIFICATE. Whenever the Exercise Price shall be adjusted as
required by the provisions of the foregoing Section, the Company shall
forthwith file in the custody of its Secretary at its principal office and
with the Warrant agent, an officer's certificate showing the adjusted
Exercise Price determined as therein provided, setting forth in reasonable
detail the facts requiring such adjustment, including a statement of the
number of additional shares of Common Stock, if any, the consideration for
such shares, determined as such Section F. provided, and such other facts
as shall be necessary to show the reason for and the manner of computing
such adjustment. Each such officer's certificate shall be made available at
all reasonable times for inspection by the holder and the Company shall,
forthwith after each such adjustment, mail a copy of such certificate to
the holder.
H. TRANSFER TO COMPLY WITH THE SECURITIES ACT OF 1933. Neither this Warrant,
the Warrant Shares, nor any other security issued or issuable upon exercise
of this Warrant may be sold or otherwise disposed or except as follows:
1. to a person who, in the opinion of counsel reasonably satisfactory to
the Company, is a person to whom the Warrant or Warrant Shares may
legally be transferred without registration and without the delivery
of a current prospectus under the Securities Act of 1933, as amended
(the "Act") with respect thereto and then only against receipt of an
agreement of such person to comply with the provisions of this Section
H. with respect to any resale or other disposition of such securities;
or
2. to any person upon the filing of a Registration Statement under the
Act and delivery of a prospectus then meeting the requirements of the
Act relating to such securities and the offering thereof for such sale
or disposition.
I. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to the holder as follows:
1. The Company is duly organized and, as of the date of the original
issuance hereof, validly existing and in good standing under the laws
of the state of Nevada.
2. The Company shall at all times reserve and keep available out of its
authorized shares of Common Stock, solely for the purpose of issuing
Warrant Shares upon the exercise of this Warrant, such shares as may
be issuable upon the exercise hereof.
<PAGE>
3. Warrant Shares, when issued and paid for in accordance with the terms
of this Warrant, will be fully paid and not assessable.
4. This Warrant has been duly authorized and approved by all required
corporate action by the Company and does not violate the certificate
of incorporation or by-laws of the Company.
[CORPORATE SEAL] INTERNATIONAL CUSTOM PACK, INC.
By:_________________________________
Brent Gutierrez, President
Dated:
ATTEST:
______________________________________
Anita Gutierrez, Secretary
<PAGE>
PURCHASE FORM
TO BE EXECUTED
UPON EXERCISE OF WARRANTS
TO: International Custom Pack, Inc.
555 Bayview Avenue
Biloxi, MS 39530
The undersigned hereby exercises, according to the terms and conditions
thereof, the right to purchase ___________ Shares of Common Stock, evidenced by
the within Warrant Certificate, and herewith makes payment of the purchase price
in full,
Dated: _________________________________
Name: _________________________________
Address: ________________________________
Signature: ______________________________
UPON EXERCISE OF THIS WARRANT PAYMENT SHOULD BE MADE TO THE ORDER OF
INTERNATIONAL CUSTOM PACK, INC.
Exhibit 4.2
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE
UPON THE EXERCISE OF THIS WARRANT ARE TRANSFERABLE
ONLY IN ACCORDANCE WITH PARAGRAPH H HEREOF.
Void after 5:00 P.M., New York Time, on April 1, 2009
Warrant to Purchase
500,000 Shares
of Common Stock
WARRANT TO PURCHASE COMMON STOCK
This is to Certify That, FOR VALUE RECEIVED, Brent Gutierrez (the "Holder"), is
entitled to purchase, subject to the provisions of this Warrant, from Global
Seafood Technologies, Inc., a Nevada corporation, having an office at 555
Bayview Avenue, Biloxi, Mississippi 39530 (the "Company"), an aggregate of
500,000 shares (the "Warrant Shares") of the Company's Common Stock, 0.001 par
value ("Common Stock") at a price of $1.56 per share (or such other price
computed by applying all adjustments made on or before April 1, 2009, in
accordance with Section F hereof, to $1.56 as if it had been the initial
Exercise Price per share hereunder) at any time on or after April 1, 1999 until
5:00 P.M. New York Time, on April 1, 2009. The number of shares of Common Stock
to be received upon the exercise of this Warrant and the price to be paid for a
share of Common Stock may be adjusted from time to time as hereinafter set
forth. The shares of Common Stock deliverable upon such exercise, and as
adjusted from time to time, are hereinafter sometimes referred to as "Warrant
Shares" and the exercise price of a share of Common Stock in effect at any time
and as adjusted from time to time is hereinafter sometimes referred to as the
"Exercise Price."
A. EXERCISE OF WARRANT. Subject to the following conditions precedent and the
provisions of Section H and I hereof, this Warrant may be exercised in
whole or in part at any time or from time to time on or after April 1,
1999, and before 5:00 P.M. New York Time on April 1, 2009, or, if either
such day is a day on which banking institutions are authorized by law to
close, then on the next succeeding day which shall not be such a day, by
presentation and surrender hereof to the Company at any office maintained
by it, or at the office of its Warrant Agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the
Exercise Price for the number of shares specified in such form. If this
Warrant should be exercised in part only, the Company shall, upon surrender
of this Warrant for cancellation, execute and deliver a new Warrant
evidencing the rights of the Holder hereof to purchase the balance of the
shares purchasable hereunder. Upon receipt by the Company of this Warrant
at its office, or by the Warrant Agent of the Company at its office, in
proper form for exercise, the Holder shall be deemed to be the holder of
record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock transfer books of the Company shall then be
<PAGE>
closed or that certificate representing such shares of Common Stock shall
not then be actually delivered to the Holder.
B. RESERVATION OF SHARES. The Company hereby agrees that at all times there
shall be reserved for issuance and/or delivery upon exercise of this
Warrant such number of shares of its Common Stock as shall be required for
issuance of delivery upon exercise of this Warrant.
C. FRACTIONAL SHARES. No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant. With respect to
any fraction of a share called for upon exercise hereof, the Company shall
issue to the Holder the next whole share.
D. EXCHANGE, ASSIGNMENT OR LOSS OF WARRANT. This Warrant is exchangeable,
without expense, at the option of the Holder, upon presentation and
surrender hereof to the company or at the office of the Warrant Agent for
other Warrants of different denominations entitling the holder thereof to
purchase in aggregate the same number of shares of Common Stock purchasable
hereunder. The term Warrant as used herein includes any Warrants into which
this Warrant may be divided or exchanged. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction, or
mutilation of this Warrant, and (in the case of loss, theft or destruction)
of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and
deliver a new Warrant of like tenor and date. Any such new warrant executed
and delivered shall constitute an additional contractual obligation on the
part of the Company, whether or not this Warrant so lost stolen, destroyed,
or mutilated shall be at any time enforceable by anyone.
E. RIGHTS OF THE HOLDER. The Holder shall not, by virtue here of, be entitled
to any rights of a shareholder in the Company, either at law or equity, and
the rights of the Holder are limited to those expressed in the Warrant and
are not enforceable against the Company except to the extent set forth
herein.
F. STOCK DIVIDENDS, RECLASSIFICATION, REORGANIZATION, ANTI-DILUTION
PROVISIONS, ETC. This Warrant is subject to the following further
provisions:
1. In case, prior to the expiration of this Warrant by exercise or by its
terms, the Company shall issue any shares of its Common Stock as a
stock dividend or subdivide the number of outstanding shares of Common
Stock into a greater number of shares, then, in either of such cases,
the Exercise Price per share of the Warrant Shares purchasable
pursuant to this Warrant in effect at the time of such action shall be
proportionately reduced and the number of Warrant Shares at that time
purchasable pursuant to this Warrant shall be proportionately
increased. In the event the Company shall contract the number of
outstanding shares of
<PAGE>
Common Stock by combining such shares into a smaller number of shares,
then, in such case, the Exercise Price per share of the Warrant Shares
purchasable pursuant to this Warrant in effect at the time of such
action shall be proportionately increased and the number of Warrant
Shares at that time purchasable pursuant to this Warrant shall be
proportionately decreased. Any dividend paid or distributed upon the
Common Stock in stock of any other class of securities convertible
into shares of Common Stock shall be treated as a dividend paid in
Common Stock to the extent that shares of Common Stock are issuable
upon the conversion thereof.
2. In case, prior to the expiration of this Warrant by exercise or by its
terms, the Company shall be recapitalized by reclassifying its
outstanding Common Stock, no par value, into stock with a different
par value or by changing its outstanding Common Stock with par value
to stock without par, the Company or a successor corporation shall be
consolidated or merge with or convey all or substantially all of its
or of any successor corporation's property and assets to any other
corporation or corporations (any such corporation being included
within the meaning of the term successor corporation in the event of
any consolidation or merger of any such corporation with, or the sale
of all or substantially all of the property of any such corporation
to, another corporation or corporations), in exchange for stock or
securities of a successor corporation, the holder of this Warrant
shall thereafter have the right to purchase upon the terms and
conditions and during the time specified in this Warrant, in lieu of
the Warrant Shares theretofore purchasable upon the exercise of this
Warrant, the kind and amount of shares of stock and other securities
receivable upon such recapitalization or consolidation, merger or
conveyance by a holder of the number of shares of Common Stock which
the holder of this Warrant might have purchased immediately prior to
such recapitalization or consolidation, merger or conveyance.
3. Upon the occurrence of each event requiring an adjustment of the
Exercise Price and of the number of Warrant Shares purchasable at such
adjusted Exercise Price by reason of such event in accordance with the
provisions of this Section F., the Company shall compute the adjusted
Exercise Price and the adjusted number of Warrant Shares purchasable
at such adjusted Exercise Price by reason of such event in accordance
with the provisions of this Section F. and shall prepare a certificate
setting forth such adjusted Exercise Price and the adjusted number of
Warrant Shares and showing in detail the facts upon which such
conclusions are based. The Company shall mail forthwith to each holder
of this Warrant a copy of such certificate, and thereafter said
certificate shall be conclusive and shall be binding upon such holder
unless contested by such holder by written notice to the Company
within thirty (30) days after receipt of the certificate by such
holder.
<PAGE>
4. In case:
(a) the Company shall take a record of the holders of its Common
Stock for the purpose of entitling them to receive a dividend or
any other distribution in respect of the Common Stock (including
cash), pursuant to without limitation, any spin-off, split-off or
distribution of the Company's assets; or
(b) the Company shall take a record of the holders of its Common
Stock for the purpose of entitling them to subscribe for or
purchase any shares of stock of any class or to receive any other
rights; or
(c) of any classification, reclassification or other reorganization
of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, or conveyance of
all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company;
then, and in any such case, the Company shall mail to the Holder, at
least twenty (20) days prior thereto, a notice stating the date or
expected date on which a record is to be taken for the purpose of such
dividend or distribution of rights, or the date on which such
classification, reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation, or winding up is to take
place, as the case may be. Such notice shall also specify the date or
expected date, if any is to be fixed, as of which holders of Common
Stock of record shall be entitled to participate in said dividend on
distribution of rights, or shall be entitled to exchange their shares
of Common stock for securities or other property deliverable upon such
classification, reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation, or winding up, as the
case may be. The failure to give such notice shall not affect the
validity of any such proceeding or transaction and shall not affect
the right of the holder of this Warrant to participate in said
dividend, distribution of rights, or any such exchange and acquire the
kind and amount of cash, securities or other property as the Holder
would have been entitled to acquire if it was the record holder of the
Warrant Shares which could be obtained upon the exercise of the
Warrants immediately before such proceeding or transaction; provided
that, the Holder exercises the Warrants within 30 days after discovery
that such action or proceeding has taken place.
5. In case the Company at any time while this Warrant shall remain unexpired
and unexercised, shall dissolve, liquidate, or wind up its affairs, the
holder of this Warrant may thereafter receive upon exercise hereof in lieu
of each share of
<PAGE>
Common Stock of the Company which it would have been entitled to receive,
the same kind and amount of any securities or assets as may be issuable,
distributable or payable upon any such dissolution, liquidation or winding
up with respect to each share of Common Stock of the Company.
G. OFFICER'S CERTIFICATE. Whenever the Exercise Price shall be adjusted as
required by the provisions of the foregoing Section, the Company shall
forthwith file in the custody of its Secretary at its principal office and
with the Warrant agent, an officer's certificate showing the adjusted
Exercise Price determined as therein provided, setting forth in reasonable
detail the facts requiring such adjustment, including a statement of the
number of additional shares of Common Stock, if any, the consideration for
such shares, determined as such Section F. provided, and such other facts
as shall be necessary to show the reason for and the manner of computing
such adjustment. Each such officer's certificate shall be made available at
all reasonable times for inspection by the holder and the Company shall,
forthwith after each such adjustment, mail a copy of such certificate to
the holder.
H. TRANSFER TO COMPLY WITH THE SECURITIES ACT OF 1933. Neither this Warrant,
the Warrant Shares, nor any other security issued or issuable upon exercise
of this Warrant may be sold or otherwise disposed or except as follows:
1. to a person who, in the opinion of counsel reasonably satisfactory to
the Company, is a person to whom the Warrant or Warrant Shares may
legally be transferred without registration and without the delivery
of a current prospectus under the Securities Act of 1933, as amended
(the "Act") with respect thereto and then only against receipt of an
agreement of such person to comply with the provisions of this Section
H. with respect to any resale or other disposition of such securities;
or
2. to any person upon the filing of a Registration Statement under the
Act and delivery of a prospectus then meeting the requirements of the
Act relating to such securities and the offering thereof for such sale
or disposition.
I. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to the holder as follows:
1. The Company is duly organized and, as of the date of the original
issuance hereof, validly existing and in good standing under the laws
of the state of Nevada.
2. The Company shall at all times reserve and keep available out of its
authorized shares of Common Stock, solely for the purpose of issuing
Warrant Shares upon the exercise of this Warrant, such shares as may
be issuable upon the exercise hereof.
<PAGE>
3. Warrant Shares, when issued and paid for in accordance with the terms
of this Warrant, will be fully paid and not assessable.
4. This Warrant has been duly authorized and approved by all required
corporate action by the Company and does not violate the certificate
of incorporation or by-laws of the Company.
GLOBAL SEAFOOD TECHNOLOGIES, INC.
[CORPORATE SEAL]
By:_________________________________
Brent Gutierrez, President
Dated:
ATTEST:
______________________________________
Anita Gutierrez, Secretary
<PAGE>
PURCHASE FORM
TO BE EXECUTED
UPON EXERCISE OF WARRANTS
TO: Global Seafood Technologies, Inc.
555 Bayview Avenue
Biloxi, MS 39530
The undersigned hereby exercises, according to the terms and conditions
thereof, the right to purchase ___________ Shares of Common Stock, evidenced by
the within Warrant Certificate, and herewith makes payment of the purchase price
in full,
Dated: _______________________________
Name: _______________________________
Address: _____________________________
Signature: ____________________________
UPON EXERCISE OF THIS WARRANT PAYMENT SHOULD BE MADE TO THE ORDER OF GLOBAL
SEAFOOD TECHNOLOGIES, INC.
Exhibit 4.3
GLOBAL SEAFOOD TECHNOLOGIES, INC.
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE
EXERCISE OF THIS WARRANT ARE TRANSFERABLE ONLY IN ACCORDANCE
WITH PARAGRAPH H HEREOF.
Void after 5:00 P.M., New York Time, on July 15, 2001
Warrant to Purchase
2,000,000 Shares
of Common Stock
WARRANT TO PURCHASE COMMON STOCK
This is to Certify That, FOR VALUE RECEIVED, William Schofield, Sr., (the
"Holder") is entitled to purchase, subject to the provisions of this Warrant,
from GLOBAL SEAFOOD TECHNOLOGIES, INC., a company organized under the laws of
the State of Nevada, having an office at 555 Bayview Avenue, Biloxi, Mississippi
39530 (the "Company"), the number of shares set forth above (the "Warrant
Shares") of the Company's Common Stock, $.001 par value ("Common Stock") at a
price of $1.00 per share (or such other price computed by applying all
adjustments made on or before July 15, 2001, in accordance with Section F
hereof, to $1.00 as if it had been the initial Exercise Price per share
hereunder) at any time on or after July 16, 1999 until 5:00 P.M. New York Time,
on July 15, 2001. The number of shares of Common Stock to be received upon the
exercise of this Warrant and the price to be paid for a share of Common Stock
may be adjusted from time to time as hereinafter set forth. The shares of Common
Stock deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price."
The Warrants represented by the Certificate are part of an authorized class of
2,000,000 Warrants.
A. EXERCISE OF WARRANT. Subject to the following conditions precedent and the
provisions of Section I hereof, this Warrant may be exercised in whole or
in part at any time or from time to time on or after July 16, 1999, and
before 5:00 P.M. New York Time on July 15, 2001, or, if either such day is
a day on which banking institutions are authorized by law to close, then on
the next succeeding day which shall not be such a day, by presentation and
surrender hereof to the Company at any office maintained by it in Biloxi,
Mississippi, or at the office of its Warrant Agent, if any, with the
Purchase Form annexed hereto duly executed and accompanied by payment of
the Exercise Price for the number of shares specified in such form. If this
Warrant should be exercised in part only, the Company shall, upon surrender
of this Warrant for cancellation, execute and deliver a new Warrant
evidencing the rights of the Holder hereof to purchase the balance of the
shares purchasable hereunder. Upon receipt by the Company of this Warrant
at its office, or by the Warrant Agent of the Company at its office, in
proper form for exercise, the Holder shall be deemed to be the holder of
record of the shares of Common Stock issuable upon such exercise,
notwithstanding that the stock
<PAGE>
transfer books of the Company shall then be closed or that certificate
representing such shares of Common Stock shall not then be actually
delivered to the Holder.
B. RESERVATION OF SHARES. The Company hereby agrees that at all times there
shall be reserved for issuance and/or delivery upon exercise of this
Warrant such number of shares of its Common Stock as shall be required for
issuance of delivery upon exercise of this Warrant.
C. FRACTIONAL SHARES. No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant. With respect to
any fraction of a share called for upon exercise hereof, the Company shall
issue to the Holder the next whole share.
D. EXCHANGE, ASSIGNMENT OR LOSS OF WARRANT. This Warrant is exchangeable,
without expense, at the option of the Holder, upon presentation and
surrender hereof to the company or at the office of the Warrant Agent for
other Warrants of different denominations entitling the holder thereof to
purchase in aggregate the same number of shares of Common Stock purchasable
hereunder. The term Warrant as used herein includes any Warrants into which
this Warrant may be divided or exchanged. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction, or
mutilation of this Warrant, and (in the case of loss, theft or destruction)
of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and
deliver a new Warrant of like tenor and date. Any such new warrant executed
and delivered shall constitute an additional contractual obligation on the
part of the Company, whether or not this Warrant so lost stolen, destroyed,
or mutilated shall be at any time enforceable by anyone.
E. RIGHTS OF THE HOLDER. The Holder shall not, by virtue here of, be entitled
to any rights of a shareholder in the Company, either at law or equity, and
the rights of the Holder are limited to those expressed in the Warrant and
are not enforceable against the Company except to the extent set forth
herein.
F. STOCK DIVIDENDS, RECLASSIFICATION, REORGANIZATION, ANTI-DILUTION
PROVISIONS, ETC. This Warrant is subject to the following further
provisions:
1. In case, prior to the expiration of this Warrant by exercise or by its
terms, the Company shall issue any shares of its Common Stock as a
stock dividend or subdivide the number of outstanding shares of Common
Stock into a greater number of shares, then, in either of such cases,
the Exercise Price per share of the Warrant Shares purchasable
pursuant to this Warrant in effect at the time of such action shall be
proportionately reduced and the number of Warrant Shares at that time
purchasable pursuant to this Warrant shall be proportionately
increased; and conversely, in the event the Company shall contract the
number of outstanding shares of Common Stock by combining such shares
into a smaller number of shares, then, in such case, the Exercise
Price per share of the Warrant Shares purchasable pursuant to this
Warrant in effect at the time of such action shall be proportionately
increased and the number of Warrant Shares at that time purchasable
pursuant to this Warrant shall
2
<PAGE>
be proportionately decreased.
2. In case, prior to the expiration of this Warrant by exercise or by its
terms, the Company shall be recapitalized by reclassifying its
outstanding Common Stock, $.001 par value, into stock with a different
par value or by changing its outstanding Common Stock with par value
to stock without par, the Company or a successor corporation shall be
consolidated or merge with or convey all or substantially all of its
or of any successor corporation's property and assets to any other
corporation or corporations (any such corporation being included
within the meaning of the term successor corporation in the event of
any consolidation or merger of any such corporation with, or the sale
of all or substantially all of the property of any such corporation
to, another corporation or corporations), in exchange for stock or
securities of a successor corporation, the holder of this Warrant
shall thereafter have the right to purchase upon the terms and
conditions and during the time specified in this Warrant, in lieu of
the Warrant Shares theretofore purchasable upon the exercise of this
Warrant, the kind and amount of shares of stock and other securities
receivable upon such recapitalization or consolidation, merger or
conveyance by a holder of the number of shares of Common Stock which
the holder of this Warrant might have purchased immediately prior to
such recapitalization or consolidation, merger or conveyance.
3. Upon the occurrence of each event requiring an adjustment of the
Exercise Price and of the number of Warrant Shares purchasable at such
adjusted Exercise Price by reason of such event in accordance with the
provisions of this Section F, the Company shall compute the adjusted
Exercise Price and the adjusted number of Warrant Shares purchasable
at such adjusted Exercise Price by reason of such event in accordance
with the provisions of this Section F. and shall prepare a certificate
setting forth such adjusted Exercise Price and the adjusted number of
Warrant Shares and showing in detail the facts upon which such
conclusions are based. The Company shall mail forthwith to each holder
of this Warrant a copy of such certificate, and thereafter said
certificate shall be conclusive and shall be binding upon such holder
unless contested by such holder by written notice to the Company
within thirty (30) days after receipt of the certificate by such
holder.
4. In case:
(a) the Company shall take a record of the holders of its Common Stock for
the purpose of entitling them to receive a dividend or any other
distribution in respect of the Common Stock (including cash), pursuant
to without limitation, any spin-off, split-off or distribution of the
Company's assets; or
(b) the Company shall take a record of the holders of its Common Stock for
the purpose of entitling them to subscribe for or purchase any shares
of stock of any class or to receive any other rights; or
3
<PAGE>
(c) of any classification, reclassification or other reorganization of the
capital stock of the Company, consolidation or merger of the Company
with or into another corporation, or conveyance of all or
substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or winding up
of the Company;
then, and in any such case, the Company shall mail to the Holder, at
least twenty (20) days prior thereto, a notice stating the date or
expected date on which a record is to be taken for the purpose of such
dividend or distribution of rights, or the date on which such
classification, reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation, or winding up is to take
place, as the case may be. Such notice shall also specify the date or
expected date, if any is to be fixed, as of which holders of Common
Stock of record shall be entitled to participate in said dividend on
distribution of rights, or shall be entitled to exchange their shares
of Common stock for securities or other property deliverable upon such
classification, reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation, or winding up, as the
case may be. The failure to give such notice shall not affect the
validity of any such proceeding or transaction and shall not affect
the right of the holder of this Warrant to participate in said
dividend, distribution of rights, or any such exchange and acquire the
kind and amount of cash, securities or other property as the Holder
would have been entitled to acquire if it was the record holder of the
Warrant Shares which could be obtained upon the exercise of the
Warrants immediately before such proceeding or transaction; provided
that, the Holder exercises the Warrants within 30 days after discovery
that such action or proceeding has taken place.
5. In case the Company at any time while this Warrant shall remain
unexpired and unexercised, shall dissolve, liquidate, or wind up its
affairs, the holder of this Warrant may thereafter receive upon
exercise hereof in lieu of each share of Common Stock of the Company
which it would have been entitled to receive, the same kind and amount
of any securities or assets as may be issuable, distributable or
payable upon any such dissolution, liquidation or winding up with
respect to each share of Common Stock of the Company.
G. OFFICER'S CERTIFICATE. Whenever the Exercise Price shall be adjusted as
required by the provisions of the foregoing Section, the Company shall
forthwith file in the custody of its Secretary at its principal office and
with the Warrant agent, an officer's certificate showing the adjusted
Exercise Price determined as therein provided, setting forth in reasonable
detail the facts requiring such adjustment, including a statement of the
number of additional shares of Common Stock, if any, the consideration for
such shares, determined as provided in such Section G, and such other facts
as shall be necessary to show the reason for and the manner of computing
such adjustment. Each such officer's certificate shall be made available at
all reasonable times for inspection by the holder and the Company shall,
forthwith after each such adjustment, mail a copy of such certificate to
the holder.
4
<PAGE>
H. TRANSFER TO COMPLY WITH THE SECURITIES ACT OF 1933. Neither this Warrant,
the Warrant Shares, nor any other security issued or issuable upon exercise
of this Warrant may be sold or otherwise disposed or except as follows:
1. to a person who, in the opinion of counsel reasonably satisfactory to
the Company, is a person to whom the Warrant or Warrant Shares may
legally be transferred without registration and without the delivery
of a current prospectus under the Securities Act of 1933, as amended
(the "Act") with respect thereto and then only against receipt of an
agreement of such person to comply with the provisions of this Section
H. with respect to any resale or other disposition of such securities;
or
2. to any person upon delivery of a prospectus then meeting the
requirements of the Act relating to such securities and the offering
thereof for such sale or disposition.
I. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and
warrants to the holder as follows:
1. The Company is duly organized and, as of the date of the original
issuance hereof, validly existing and in good standing under the laws
of the State of Nevada.
2. The Company shall at all times reserve and keep available out of its
authorized shares of Common Stock, solely for the purpose of issuing
Warrant Shares upon the exercise of this Warrant, such shares as may
be issuable upon the exercise hereof.
3. Warrant Shares, when issued and paid for in accordance with the terms
of this Warrant, will be fully paid and not assessable.
4. This Warrant has been duly authorized and approved by all required
corporate action by the Company and does not violate the certificate
of incorporation or by-laws of the Company.
[SIGNATURE PAGE FOLLOWS]
5
<PAGE>
GLOBAL SEAFOOD
TECHNOLOGIES, INC.
[CORPORATE SEAL]
By: ___________________________
Brent Gutierrez, President
Dated:
ATTEST:
__________________________________
Anita Gutierrez, Secretary
HOLDER: William Schofield, Sr.
SHARES: 2,000,000
6
<PAGE>
PURCHASE FORM
TO BE EXECUTED
UPON EXERCISE OF WARRANTS
TO: GLOBAL SEAFOOD TECHNOLOGIES, INC.
555 Bayview Avenue
Biloxi, MS 39530
The undersigned hereby exercises, according to the terms and conditions thereof,
the right to purchase _____________ Shares of Common Stock, evidenced by the
within Warrant Certificate, and herewith makes payment of the purchase price in
full.
Dated: ____________________________
Name: ____________________________
Address: ___________________________
Signature: _________________________
UPON EXERCISE OF THIS WARRANT PAYMENT SHOULD BE MADE TO THE ORDER OF GLOBAL
SEAFOOD TECHNOLOGIES, INC.
7
ACQUISITION AGREEMENT AND
PLAN OF TAX-FREE REORGANIZATION
This agreement and plan dated as of the 1st day of October, 1997, by and
among COMAR FOODS, INC. (the "Target"), an Alabama corporation, and FRANK G.
TERRELL AND JAMES V. COLLIER, JR. (being all of the shareholders of Target),
INTERNATIONAL CUSTOM PACK, INC. (the "Parent", whose symbol is "IPCK" in the OTC
market), a Mississippi corporation; BRENT GUTIERREZ and CLAY GUTIERREZ; and J.
V. COLLIER;
W I T N E S S E T H :
WHEREAS, Target is the owner of all of the assets (the "Assets") listed on
Target's list of assets as of September 30, 1997 (copy of which is marked
Exhibit "A", attached hereto and made a part hereof by this reference), subject
to the liabilities (the "Liabilities") set forth on Exhibits "B-l", "B-2" and
"B-3", attached hereto and made a part hereof by this reference; and
WHEREAS, Parent desires to acquire all of the issued and outstanding stock
of Target (owned 50% by Frank G. Terrell and 50% by James V. Collier, Jr.) in
exchange for voting common stock of Parent;
WHEREAS, the Target shareholders are willing to indemnify Parent for
certain liabilities, with J. V. Collier joining in, and Brent Gutierrez and Clay
Gutierrez are willing to guarantee certain other liabilities; and
WHEREAS, the parties desire that such exchange and matters ancillary
thereto be upon the terms, conditions and plan hereinafter contained;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
of the parties set forth herein, it is hereby agreed as follows:
1. TARGET STOCK. Target's shareholders shall deliver at closing (the "Closing"
hereinafter described) to Parent all of the issued and outstanding stock of
Target, free and clear of all liens and encumbrances (except for the Alabama
Assessment of Share Tax), with each certificate properly endorsed to Parent or
with appropriate stock
1
<PAGE>
powers attached. Target's attorney, Edward A. Hyndman, Jr., shall hold said
stock pending delivery of Parent stock below. When Parent stock is so delivered,
Hyndman shall release the Target stock to Parent.
2. CONSIDERATION. The aggregate consideration for the exchange is $1,500,000.00
of value (plus an assumption of equipment leases), computed as follows:
(a) $300,000.00 OF VALUE: Parent shall contribute to Target $300,000.00
($120,000.00 of which shall be cash at Closing and the $180,000.00 balance of
which shall be provided at the rate of $30,000.00 per month during the six (6)
months next after Closing, the first such payment to be made on October 31,
1997, and a like payment on the last day of each of the succeeding five months
thereafter), to be applied against the Liabilities as follows:
(i) With said $120,000.00, Target shall pay and satisfy at Closing
those Liabilities listed on said Exhibit B-1 (the checks to be made and
mailed at closing); and
(ii) Parent shall assume at Closing those Liabilities listed on said
Exhibit B-2, and Target shall pay and satisfy them with said $180,000.00
over said six (6)-month period (the order and priority of payment, if any,
being set forth on said Exhibit B-2);
(b) $266,289.74 OF VALUE: Parent shall assume at Closing those liabilities
listed on said Exhibit B-3 (the Steiner mortgage and the KBK debt), and shall
cause Target to pay and satisfy them according to their respective terms,
without any extension or amendment;
(c) BALANCE OF VALUE: The remaining $933,710.26 of value is composed of the
following:
(i) To John Carpenter, at Closing, as payment for commission due on
sale, 13,574 shares of the voting common stock of Parent, with Parent's
stock valued at $2.21 per share (net of all discounts);
2
<PAGE>
(ii) To Jamie Collier at Closing, in exchange for the Target stock
described in Section 1 above, 113,122 shares of the voting common stock of
Parent with the Parent's stock valued at $2.21 per share (net of all
discounts); and
(iii) To Frank G. Terrell at Closing, in exchange for the part of his
indebtedness remaining unpaid to him net of the Exhibit B-2 payments to be
made to him above, and also for Terrell's Target stock, 295,796 shares of
the voting common stock of Parent with the Parent's stock valued at $2.21
per share (net of all discounts).
All of said stock shall be (1) validly issued, fully paid and non-assessable,
and countersigned by Parent's transfer agent, Fidelity Transfer Co., and (2)
unrestricted and freely transferrable except for the following legend:
This certificate is transferrable only in compliance with
SEC Rule 144 or an applicable statutory exemption in the
1933 Securities Act or an appropriate investment letter from
a proposed transferee.
Pursuant to the Plan of Reorganization, such Parent stock is being distributed
to Frank G. Terrell (on said remaining part of his debt) and to the shareholders
of Target (with respect to their stock in Target), in accordance with the above.
(Exhibits "C" and "D" are hereby deleted.)
PROVIDED, HOWEVER, if for any reason the aggregate liabilities in Subparagraph
(a) ($300,000.00 of value) and Subparagraph (b) ($266,289.74 of value) total
less than $566,289.74 at Closing, then the number of shares of voting common
stock under Subparagraph (c) ($933,710.26 of value) shall be increased by the
difference between $566,289.74 and such lesser total, valuing such stock at
$2.21 per share for this purpose, such additional stock to be distributed to
Frank G. Terrell.
(d) LEGAL AND ACCOUNTING FEES. Target's legal and accounting fees,
$7,400.00 to Edward A. Hyndman, Jr. and $3,420.00 to Crow & Shields, shall be
listed on said Exhibit B-1 and paid in cash at Closing as part of said
$120,000.00.
(e) EQUIPMENT LEASES. In addition to said $1,500,000.00 of value, Parent
shall assume and agree to pay and perform in accordance with their respective
3
<PAGE>
terms the equipment leases of Target listed on Exhibit "E", attached hereto and
made part hereof by this reference.
(f) RELEASES. Set forth on Exhibit "F" is a list of such of the Liabilities
and leases as to which Target and its shareholders are due to be released from
liability. Parent agrees to cooperate in obtaining such releases after the
assumptions of such as provided in this agreement are reflected on the books and
records of the respective creditors or leasors.
3. TAX-FREE REORGANIZATION. The parties have structured and planned this
transaction to be a tax-free "Reorganization" under I.R.C. ss.368, and the
parties shall each consistently report the transaction as such to the Internal
Revenue Service and the appropriate state taxing authorities. Without limiting
the foregoing, Target shall, at its own cost and expense, prepare and file the
appropriate so-called "ss.368 attachments" to its final income tax return, and
Parent shall account for the transaction as a tax-free reorganization and carry
the Assets at their respective values shown on said Exhibit A, without any
write-up whatsoever, whether or not Target becomes a member of a consolidated
group for federal income tax purposes. In view of the foregoing, no I.R.C.
ss.1060 allocation has been made, since no taxable purchase and sale is to
occur.
4. RESTRICTED STOCK/REGISTRATION RIGHTS. The Parties understand and agree that
the voting common stock of Parent to be delivered to Target's shareholders and
to Frank G. Terrell with respect to his debt at Closing is so-called
"restricted" stock under the 1933 Securities Act, and absent registration of
such stock, Target's stockholders (and Frank G. Terrell with respect to his
Parent stock received for indebtedness) will only be able to sell said stock
pursuant to Rule 144 or a statutory exemption (e.g., ss.4(b) of the 1933
Securities Act). Parent agrees to remain current in its 1934 Securities Act
("Exchange Act") filings, if and when Parent becomes subject to such Act.
If there are any registration statements filed after the one referenced in
paragraph 5 hereof, then Target's shareholders (and Frank G. Terrell with
respect to his Parent stock received for indebtedness) shall have the right (but
not the obligation) to "piggyback" and participate in such to the extent of
422,492 shares of IPCK voting common stock (adjusted for any stock spits,
conversions and the like).
4
<PAGE>
5. LACK OF A PUBLIC MARKET. Target's shareholders understand and agree that
there is an extremely limited public market for Parent's voting common stock at
the present time, such stock being "OTC BB". Parent agrees to use its best
efforts to file a registration statement with the SEC and make a public offering
to the end that, at a minimum, Parent's stock will be regularly listed at least
in the NASDAQ Supplemental List. However, Target's shareholders understand and
agree that there is no guarantee that such best efforts will be successful.
6. CLOSING. Closing shall take place at the offices of Crow & Shields, on 6163
Omni Park Drive, Mobile, Alabama, (or at such other location as the parties may
mutually agree) on or before October 1, 1997, but on a date and time within such
time frame on a regular business day an, at a regular business hour mutually
agreeable to the parties. For purposes of this agreement, the term "Closing"
shall mean the Closing described above.
7. INTERIM CONDUCT. Target agrees to take good care of the Assets prior to
Closing so that there will be no material adverse change in the title or
condition of the Assets pending Closing. In addition, Target shall not declare
any dividends or redeem any of its stock, shall attempt to maintain its
inventory in the ordinary and regular course, and shall continue to compensate
its employees in like manner as it has in the past.
8. GOVERNING LAW. This instrument shall be governed by and construed according
to the laws of the State of Alabama.
9. CAPTIONS. The captions in this instrument are for convenience of reference
only and shall not affect the construction or interpretation of this instrument.
10. BINDING EFFECT. This instrument shall bind and inure to the benefit of the
undersigned and their respective successors and assigns. Parent shall cooperate
in having J. V. Collier and/or James V. Collier, Jr. reflected as transferee
owners of record of any of such stock given to them by Frank G. Terrell, with
appropriate investment letters from such donees.
5
<PAGE>
11. COUNTERPARTS. This instrument may be executed in any number of partial or
fully executed counterparts, each of which shall be deemed an original but all
of which shall constitute but one agreement.
12. CORPORATE GUARANTY. Comes now Parent and as a material inducement to Target
and its shareholders to execute and deliver this instrument, hereby guarantees
the payment and performance of the Liabilities (and said equipment leases) not
paid (or performed) in full at Closing. Said inducement, agreement and guarantee
shall survive the Closing.
13. PERSONAL GUARANTIES. Come now Brent Gutierrez and Clay Gutierrez, and as a
material inducement to Target and its shareholders to execute and deliver this
instrument, hereby (1) guarantee, jointly and severally, the payment and
performance of the Steiner note and mortgage (described on Exhibit B-3) and (2)
agree, jointly and severally, to obtain and deliver to the Target shareholders,
within 120 days next after Closing, releases of the Target shareholders from all
liability (i) to KBK on account of the loan described on Exhibit B-3 and (ii) to
any lessors on account of the leases described on Exhibit E, failing any of
which releases under clauses "(i)" or "(ii)" above (which releases Brent
Gutierrez and Clay Gutierrez agree to use their best efforts to obtain) within
said 120 days, Brent Gutierrez and Clay Gutierrez shall jointly and severally
indemnify and hold harmless each of the Target shareholders from any and all
liability, loss, damage, cost and expense (including court costs and attorney's
fees) at any time arising from any or all of said Exhibit B-3 and Exhibit E
matters. Said inducement, guarantee, agreement to obtain releases and said
indemnities shall survive the Closing.
14. CLAIMS. (a) Parent shall give Frank G. Terrell, J. V. Collier and James V.
Collier, Jr. (the "Indemnitors") specific written notice if any claim is made or
litigation instituted against Target for which Parent in turn intends to make a
claim under this Section 14. Indemnitors shall have the right, to be exercised
within fifteen (15) days after the giving of such notice by Parent, to defend or
otherwise contest such claim or litigation against Target, and to prosecute
appeals in connection therewith, with counsel of their own choosing. Parent
agrees to reasonably cooperate in such defense, including giving Indemnitors
access to any records of Target helpful to such defense.
6
<PAGE>
(b) Subject to the provisions of Section 14(c) below, if any such claim or
litigation is not disputed (or not successfully defended or contested, as the
case may be) by Indemnitors, then Indemnitors shall, within fifteen (15) days
after demand, pay the same, and jointly and severally agree to indemnify and
save Parent harmless in connection therewith.
(c) Anything contained elsewhere in this instrument to the contrary
notwithstanding, (1) Parent shall be entitled to make a claim against
Indemnitors only with respect to liabilities of Target which existed at or
before Closing and which have not been disclosed in Exhibits "B-1", "B-2",
"B-3", "E" or "F" of this instrument; and (2) no Indemnitor shall have any
liability to the extent that any claim is covered by insurance.
IN WITNESS WHEREOF, the corporate parties hereto have caused this
instrument to be executed and their corporate seals affixed by their respective
officers hereunder duly authorized, and the individual parties have hereunto set
their respective hands and seals, all as of the day and year first above
written.
COMAR FOODS, INC.
(AFFIX BY: /s/ James V. Collier, Jr.
CORPORATE -------------------------------
SEAL) AS ITS PRESIDENT
ATTEST:
BY: /s/ James V. Collier, Jr.
-------------------------
AS ITS SECRETARY
INTERNATIONAL CUSTOM PACK, INC.
(AFFIX BY: /s/ Brent Gutierrez
CORPORATE -------------------------------
SEAL) AS ITS PRESIDENT
ATTEST:
BY: /s/ Clay Gutierrez
-------------------------
AS ITS SECRETARY
7
<PAGE>
/s/ Frank G. Terrell (SEAL)
-----------------------------
FRANK G. TERREL
By: [ILLEGIBLE] as Attorney in Fact
/s/ James V. Collier, Jr. (SEAL)
-----------------------------
JAMES V. COLLIER, JR.
/s/ J.V. Collier (SEAL)
-----------------------------
J.V. COLLIER
/s/ Brent Gutierrez (SEAL)
-----------------------------
BRENT GUTIERREZ
/s/ Clay Gutierrez (SEAL)
-----------------------------
CLAY GUTIERREZ
8
<PAGE>
Exhibit A
Cash -
Oper. Acct 1,176.94
P/R Acct. 109.97 1,286.91*
---------
Less EOM service charge
Acct. Rec. 6,666.50
Prepaid Insurance 979.35
Inventory 34,903.22
Land 22,500.00
Fixed Assets (Net) 168,585.48
Deposits -
Utilities 185.00
Leases 2,886.03 3,071.03
---------
All recipes, formulas, customers held by CoMar Foods.
Exhibit A
<PAGE>
<TABLE>
<CAPTION>
RUN DATE: 10/01/97 CoMar Foods, Inc. PAGE 1
RUN TIME: 12:14 PM
DETAIL TRIAL BALANCE
- ------------------------------------------------------------------------------------------------------------------------------------
ACCOUNT RANGE: 10301 TO 10301 PERIOD ENDING 09/30/97
- ---------ACCOUNT------------- -BEGINNING- --------------------------TRANSACTION----------------------- --ENDING--
NUMBER DESCRIPTION BALANCE DESCRIPTION DATE PP PE S REFERENCE AMOUNT BALANCE
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C><C> <C> <C> <C>
10301 AmSouth - Operating 2,128.33
Deposit - Terrell 09/04 09 09 1 10.75
St. Elmo-Irvington Water 09/02 09 09 2 9909 54.32-
Integon National 09/02 09 09 2 9910 519.33-
HealthPlan Services 09/02 09 09 2 9911 290.32-
AmSouth Bank 09/03 09 09 2 9912 5.00-
Clarklift 09/03 09 09 2 9913 11.23-
Postmaster 09/04 09 09 2 9914 21.50-
CoMar Foods P/R Acct. 09/04 09 09 2 9915 3,525.00-
J & L Seafood 09/04 09 09 2 9916 220.00-
John Howard 09/04 09 09 2 9917 220.00-
Fruit Dist. 09/05 09 09 2 9918 163.67-
The Sheffield Fund 09/08 09 09 2 9919 463.00-
SAIA 09/08 09 09 2 9920 174.26-
Fruit Dist. 09/11 09 09 2 9921 363.48-
CoMar Foods P/R Acct. 09/11 09 09 2 9922 3,000.00-
CoMar Foods P/R Acct. 09/12 09 09 2 9923 1,100.00-
Alterman Transport Lines 09/12 09 09 2 9925 288.52-
Mobile Gas Service 09/15 09 09 2 9926 174.76-
HRH Insurance 09/15 09 09 2 9928 535.00-
Restaurant News 09/15 09 09 2 9929 65.00-
KBK Financial, Inc. 09/15 09 09 2 D/M 4,136.00-
NET PAY 09/03 09 09 P 7,333.33-
09/17 09 09 A 1,799.42-
09/17 09 09 R 27,223.53-
09/29 09 09 R 12,682.64-
Sam's 09/16 09 09 2 9930 170.13-
Fruit Dist. 09/17 09 09 2 9931 361.95-
Postmaster 09/17 09 09 2 9932 10.75-
CoMar Foods P/R Acct. 09/18 09 09 2 9933 4,000.00-
Fruit Dist. 09/19 09 09 2 9934 331.80-
Capt. Collier's 09/19 09 09 2 9935 210.00-
Dees Paper 09/19 09 09 2 9936 159.48-
Sam's 09/19 09 09 2 9937 115.83-
Lonnie A. Forrest 09/22 09 09 2 9938 20.00-
Postmaster 09/23 09 09 2 9939 10.75-
Fruit Dist. Co 09/23 09 09 2 9940 256.66-
Alterman Transport 09/23 09 09 2 9941 136.70-
Postmaster 09/24 09 09 2 9942 32.00-
Internal Revenue Service 09/24 09 09 2 9943 846.45-
CoMar Foods P/R Acct. 09/25 09 09 2 9944 4,550.00-
St. Elmo-Irvington Water 09/26 09 09 2 9945 145.19-
HealthPlan Services 09/26 09 09 2 9946 290.32-
AmSouth Bank 09/26 09 09 2 9947 485.94-
Deborah Collier 09/26 o9 o9 2 9950 144.55-
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
RUN DATE: 10/01/97 CoMar Foods, Inc. PAGE 2
RUN TIME: 12:14 PM
DETAIL TRIAL BALANCE
- ------------------------------------------------------------------------------------------------------------------------------------
ACCOUNT RANGE: 10301 TO 10301 PERIOD ENDING 09/30/97
- ---------ACCOUNT------------- -BEGINNING- --------------------------TRANSACTION----------------------- --ENDING--
NUMBER DESCRIPTION BALANCE DESCRIPTION DATE PP PE S REFERENCE AMOUNT BALANCE
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C><C> <C> <C> <C>
10301 AmSouth - Operating (Continued)
Postmaster 09/26 09 09 2 9951 10.75-
Deposit - Keith 09/25 09 09 1 16.66
09/30 09 09 R 3,025.85
Torrence Cablevision 09/26 09 09 2 9952 25.79-
AmSouth 09/26 09 09 2 9953 539.48-
Void 09/29 09 09 2 9954 0.00-
FedEx 09/29 09 09 2 9956 15.00-
Lonnie Forrest 09/29 09 09 2 9957 25.00-
09/30 09 09 A 5,818.72-
09/30 09 09 A 3,312.29-
Deposit - Custom Pack 09/30 09 09 1 7,851.00
Petros Grevenitis 09/30 09 09 2 9958 233.85-
AmSouth 09/30 09 09 2 9959 4,825.45-
Cash - Exp. Reimb. 09/30 09 09 2 9970 213.85-
951.39-* 1,176.94 *
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*** End Of - DETAIL TRIAL BALANCE ***
<PAGE>
<TABLE>
<CAPTION>
RUN DATE: 10/01/97 CoMar Foods, Inc. PAGE 1
RUN TIME: 12:15 PM
DETAIL TRIAL BALANCE
- ------------------------------------------------------------------------------------------------------------------------------------
ACCOUNT RANGE: 10302 TO 10302 PERIOD ENDING 09/30/97
- ---------ACCOUNT------------- -BEGINNING- --------------------------TRANSACTION----------------------- --ENDING--
NUMBER DESCRIPTION BALANCE DESCRIPTION DATE PP PE S REFERENCE AMOUNT BALANCE
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C><C> <C> <C> <C>
10302 AmSouth - Payroll 33.62
CoMar Foods P/R Acct. 09/04 09 09 2 9915 3,525 00
CoMar Foods P/R Acct. 09/11 09 09 2 9922 3,000 00
CoMar Foods P/R Acct. 09/12 09 09 2 9923 1,100.00
NET PAY 09/03 09 09 P 2,116.92-
NET PAY 09/03 09 09 P 1,389.12-
NET PAY 09/10 09 09 P 2,676.49-
NET PAY 09/10 09 09 P 1,422.64-
NET PAY 09/17 09 09 P 2,545.78-
NET PAY 09/17 09 09 P 1,421.68-
NET PAY 09/24 09 09 P 3,057.88-
NET PAY 09/24 09 09 P 1,422.64-
Angel Fields 09/26 09 09 2 3513 3.40-
Cellia Dixon 09/26 09 09 2 3514 42.10-
CoMar Foods P/R Acct. 09/18 09 09 2 9933 4,000.00
CoMar Foods P/R Acat. 09/25 09 09 2 9944 4,550.00
76.35* 109.97*
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*** End Of - DETAIL TRIAL BALANCE ***
<PAGE>
<TABLE>
<CAPTION>
RUN DATE: 09/30/97 CoMar Foods, Inc. PAGE 1
RUN TIME: 11:49 AM Accounts Receivabie
Detailed Aged Receivables Report
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
[ILLEGIBLE]
</TABLE>
<PAGE>
CoMar Foods, Inc.
Prepaid Insurance
1997
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Balance Expense Balance Expense Balance Expense Balance Expense Balance
Coverage 06/30/97 July '97 07/31/97 Aug. '97 08/31/97 Sept.'97 09/30/97 Oct.'97 10/31/97
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Flood Ins.-Satsuma St.
(03/22/96-97)
Cancelled in Dec. Return prem. rcvd April, 1997.
Comm. Pkg./Umbrella 519.29 (519.29) 0.00
(07/28/96-97)
Comm. Pkg. - A/C & Tape 15.19 (15.19) (0.00)
(07/28/96-97)
Comm. Pkg. - Up Eqpt. 99.47 (99.47) 0.00
(08/29/96-07/28/97)
Auto Ins.
(12/01/96-97) 2,456.39 (497.70) 1,958.69 (497.70) 1,460.99 (481.64) 979.35 (497.70) 481.65
Comm. Pkg./Umbrella
(Cancel Satsuma St.) (149.55) 149.55 (0.00)
-------- ------- -------- ------- ------- ------- ------ ------- ------
Totals 2,940.79 (982.10) 1,958.69 (497.70) 1460.99 (481.64) 979.35 (497.70) 481.65
======== ======= ======== ======= ======= ======= ====== ======= ======
</TABLE>
<PAGE>
Date: 9-30-97
-------
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
CODE PRODUCT DESCRIPTION BEGINNING IN OUT ENDING
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------
BO-101 OYSTER - HOME STYLE
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
BC-101 CRAB CLAW-ORIGINAL
- ----------------------------------------------------------------------------------------------------------
BC-102 CRAB CLAW-SEASONED 30 43.26 1297.80
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
CCB-0100 1 SFD-PLATTER CORPUS CHRISTI CRAB 5 30.00 150.00
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
CSB-122B 50/60 SEAS BRD POPCORN
- ----------------------------------------------------------------------------------------------------------
CSB-201B 2-4 oz. BRD CATFISH
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
GB-125B 60/80 BRD SCALLOP 98 49.80 4880.40
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
HS-103 21/25 TAIL ON
- ----------------------------------------------------------------------------------------------------------
HS-105 26/30 TAIL ON 2 35.34 70.68
- ----------------------------------------------------------------------------------------------------------
HS-106 26/30 SEASONED TAIL ON
- ----------------------------------------------------------------------------------------------------------
HS-107 31/35 TAIL ON 1 33.90 33.90
- ----------------------------------------------------------------------------------------------------------
HS-109 38/44 TAIL ON
- ----------------------------------------------------------------------------------------------------------
HS-118 38/44 SEASONED B.T.O.
- ----------------------------------------------------------------------------------------------------------
HS-121 50/60 B.T.O. 2 26.40 52.80
- ----------------------------------------------------------------------------------------------------------
HS-122 50/60 SEASONED B.T.O. 6#
- ----------------------------------------------------------------------------------------------------------
HS-122M 50/60 SEASONED B.T.O. 12#
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
MSB-0100 1 oz. MONTEREY SHRIMP 10 25.80 258.00
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
NOC-0150 1.5 oz. CRAB CAKE
- ----------------------------------------------------------------------------------------------------------
NOC-0160 1.6 oz. BREADED CAKE
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
SFSN-0080 .8 oz. SANTA FE SHRIMP
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
RAW PRODUCT
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
00011 HOME STYLE SHRIMP
- ----------------------------------------------------------------------------------------------------------
00013 BRD TAIL-OFF
- ----------------------------------------------------------------------------------------------------------
00014 3oz. STUFFED CRAB 6 59.76 358.56
- ----------------------------------------------------------------------------------------------------------
00015 ST JALAPENO PEPPER 3 71.76 215.28
- ----------------------------------------------------------------------------------------------------------
00016 BRD CRAWFISH 11 119.76 1317.36
- ----------------------------------------------------------------------------------------------------------
00017 SANTE FE NUGGETS 3 51.00 153.00
- ----------------------------------------------------------------------------------------------------------
00018 MONTEREY BITES 12 51.00 612.00
- ----------------------------------------------------------------------------------------------------------
00019 BRD SCALLOPS 1 102.00 102.00
- ----------------------------------------------------------------------------------------------------------
00020 BRD OYSTERS
- ----------------------------------------------------------------------------------------------------------
00021 BRD CRABCAKES 1 59.76 59.76
- ----------------------------------------------------------------------------------------------------------
00022 [ILLEGIBLE]
- ----------------------------------------------------------------------------------------------------------
00023 MOZZARELLA CHEESE 32 71.76 2296.32
- ----------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CoMar Foods, Inc. PAGE 14
RUN DATE: 09/30/97 Inventory Control
RUN TIME: 4:43 PM Physical Inventory Report
- --------------------------------------------------------------------------------
DEPARTMENT:
ITEM VENDOR VENDOR SELL ---QTY-ON-HAND---
NUMBER DESCRIPTION LOCATION ID ITEM# UNIT CALCULATED ACTUAL COMMENTS
- ------ ----------- -------- ------ ------ ---- ---------- ------ --------
[ILLEGIBLE]
2048 # 552.96
750 # 247.50
197 lb. 281.71
625 lb. 143.75
317 lb. 174.35
1850 lb. 334.85
95 gr. 286.90
.8 # 3.83
700 # 175.00
11.2 1.46
<PAGE>
CoMar Foods, Inc. PAGE 15
RUN DATE: 09/30/97 Inventory Control
RUN TIME: 4:43 PM Physical Inventory Report
- --------------------------------------------------------------------------------
DEPARTMENT:
ITEM VENDOR VENDOR SELL ---QTY-ON-HAND---
NUMBER DESCRIPTION LOCATION ID ITEM# UNIT CALCULATED ACTUAL COMMENTS
- ------ ----------- -------- ------ ------ ---- ---------- ------ --------
[ILLEGIBLE]
1640 # 852.80
350 # 140.00
1750 # 1155.00
280 lb. 170.80
380 # 399.20
70 lb. 161.70
64 oz. 8.32
1785 lb. 1785.00
1450 lb. 739.50
104 lb. 94.64
39 lb. 34.71
275 lb. 286.00
<PAGE>
CoMar Foods, Inc. PAGE 16
RUN DATE: 09/30/97 Inventory Control
RUN TIME: 4:43 PM Physical Inventory Report
- --------------------------------------------------------------------------------
DEPARTMENT:
ITEM VENDOR VENDOR SELL ---QTY-ON-HAND---
NUMBER DESCRIPTION LOCATION ID ITEM# UNIT CALCULATED ACTUAL COMMENTS
- ------ ----------- -------- ------ ------ ---- ---------- ------ --------
[ILLEGIBLE]
315 lb. 138.60
186 # 85.56
215 # 202.10
1344 oz. 147.84
320 oz. 12.80
6 gal. 768oz. 23.04
17 gal. 217oz. 21.76
97 lb. $269.66
2000 100.00
4000 200.00
1200 60.00
192 oz. 7.68
$1,269.04
<PAGE>
CoMar Foods, Inc. PAGE 24
RUN DATE: 09/30/97 Inventory Control
RUN TIME: 4:43 PM Physical Inventory Report
- --------------------------------------------------------------------------------
DEPARTMENT:
ITEM VENDOR VENDOR SELL ---QTY-ON-HAND---
NUMBER DESCRIPTION LOCATION ID ITEM# UNIT CALCULATED ACTUAL COMMENTS
- ------ ----------- -------- ------ ------ ---- ---------- ------ --------
[ILLEGIBLE]
1140 lb. 684.00
840 lb. 1848.00
50 lb.
60 lb. 180.00
214 lb. 1209.10
120 lb.
595 lb. 1338.75
$5,913.35
<PAGE>
CoMar Foods, Inc. PAGE 1
RUN DATE: 09/30/97 Inventory Control
RUN TIME: 4:43 PM Physical Inventory Report
- --------------------------------------------------------------------------------
DEPARTMENT:
ITEM VENDOR VENDOR SELL ---QTY-ON-HAND---
NUMBER DESCRIPTION LOCATION ID ITEM# UNIT CALCULATED ACTUAL COMMENTS
- ------ ----------- -------- ------ ------ ---- ---------- ------ --------
[ILLEGIBLE]
.42 260 109.20
.47 751 352.97
.28 900 252.00
.15 10350 1552.50
.58 3065 1777.70
.43 3142 1351.06
.26 6 1.56
.32 3100 992.00
$6,388.99
<PAGE>
CoMar Foods, Inc. PAGE 2
RUN DATE: 09/30/97 Inventory Control
RUN TIME: 4:43 PM Physical Inventory Report
- --------------------------------------------------------------------------------
DEPARTMENT:
ITEM VENDOR VENDOR SELL ---QTY-ON-HAND---
NUMBER DESCRIPTION LOCATION ID ITEM# UNIT CALCULATED ACTUAL COMMENTS
- ------ ----------- -------- ------ ------ ---- ---------- ------ --------
[ILLEGIBLE]
.44 2600 1144.00
$1,144.00
<PAGE>
CoMar Foods 09-Sep-97
Depreciation 03:59 PM
1997
<TABLE>
<CAPTION>
Date Method/ A/D Depr. A/D
Acquired Cost Life 12/31/96 for 1997 12/31/97
-------- ---- ------- -------- -------- --------
Furniture & Equipment (174)
<S> <C> <C> <C> <C> <C> <C>
Secretarial desk 08/89 500.00 MACRS 7 500.00 0.00 500.00
3-drawer file cabinet 08/89 150.00 MACRS 7 150.00 0.00 150.00
Typewriter 11/90 160.34 MACRS 7 153.20 7.14 160.34
Microwave 12/92 95.04 MACRS 7 65.35 8.49 73.84
Carpet 06/93 2,697.40 MACRS 7 1,854.74 240.88 2,095.62
Stove & Refrigerator 06/93 3,159.06 MACRS 5 2,613.17 363.92 2,977.09
Copier - United Office 06/93 1,084.55 MACRS 5 897.14 124.94 1,022.08
Chairs - Office Max 06/93 698.61 MACRS 7 480.37 62.39 542.76
Chairs - Belinda Brannon 06/93 245.00 MACRS 7 168.46 21.88 190.34
Lobby furniture - McAleers 06/93 608.22 MACRS 7 418.21 54.31 472.52
Awning - Canvas Products 06/93 1,242.80 MACRS 7 854.56 110.98 965.54
Word processor - Wal Mart 08/93 326.86 MACRS 5 270.38 37.65 308.03
Chairs - McAleers 10/93 238.71 MACRS 7 164.13 21.32 185.45
Computer 08/95 965.11 MACRS 5 501.86 185.30 687.16
Printer - Office Depot 09/95 371.68 MACRS 5 193.28 71.36 264.64
Chair - McAleer's 10/95 151.51 MACRS 7 58.75 26.50 85.25
Printers - E. Vrachalus 11/95 315.00 MACRS 5 63.00 100.80 163.80
Alarm System - US Alarms 08/96 419.50 MACRS 5 83.90 134.24 218.14
Magnavox 19" TV- Lowes 10/96 202.23 MACRS 5 40.45 64.71 105.16
Simplex Time Clock 11/96 1,375.28 MACRS 5 275.06 440.09 715.15
--------- -------- -------- ---------
15,006.90 9,806.01 2,076.90 11,882.91
Vehicles (177)
1991 Chev Lumina 12/91 12,870.00 MACRS 5 12,870.00 0.00 12,870.00
1994 GMC Sierra Pickup 01/94 14,950.00 MACRS 5 10,510.00 1,675.00 12,185.00
--------- --------- -------- ---------
27,820.00 23,380.00 1,675.00 25,055.00
</TABLE>
<PAGE>
CoMar Foods 09-Sep-97
Depreciation 03:59 PM
1997
<TABLE>
<CAPTION>
Date Method/ A/D Depr. A/D
Acquired Cost Life 12/31/96 for 1997 12/31/97
-------- ---- ------- -------- -------- --------
Equipment (173)
<S> <C> <C> <C> <C> <C>
SS auto batter/flour sifter 1989 550.00 MACRS 7 550.00 0.00 550.00
4 SS tables 1989 1,560.00 MACRS 7 1,560.00 0.00 1,560.00
Commercial sink 1989 975.00 MACRS 7 975.00 0.00 975.00
9 freezer racks/100 trays 1989 2,250.00 MACRS 7 2,250.00 0.00 2,250.00
Basket 03/90 262.42 MACRS 7 250.71 11.71 262.42
Fire System 09/90 1,011.80 MACRS 7 966.66 45.14 1,011.80
Trays 11/90 384.05 MACRS 7 366.94 17.11 384.05
Trays 03/91 248.41 MACRS 7 223.96 21.74 245.70
Stein Fryer - Deverell Foods 03/93 33,500.00 MACRS 7 23,034.60 2,991.55 26,026 15
5 and 12 ft. turn conveyer belts 06/93 5,700.00 MACRS 7 3,919.32 509.01 4,428.33
IQF tunnel - United Sheet 04/93 11,500.00 MACRS 7 7,907.40 1,026.95 8,934.35
2 brd/batter mach.-United Sheet 06/93 14,000.00 MACRS 7 9,626.40 1,250.20 10,876.60
Air compressor - United Sheer 07/93 500.00 MACRS 7 343.80 44.65 388.45
Batter mixer eqpt. - K. Seaman 06/93 135.00 MACRS 7 92.82 12.06 104.88
Fire extinguisher system 07/93 1,661.20 MACRS 7 1,142.24 148.35 1,290.59
2 ventilators - Grainger 07/93 1,148.89 MACRS 7 789.98 102.60 892.58
Vent - Grainger 08/93 520.56 MACRS 7 357.95 46.49 404.44
Manifold - Airco 08/93 1,890.00 MACRS 7 1,299.56 168.78 1,468.34
Fryer System - Deverell 08/93 3,000.00 MACRS 7 2,062.80 267.90 2,330.70
Prop. Mixer - Rand 08/93 357.31 MACRS 7 245.69 31.91 277.60
Mod. brd machine - Whites 08/93 965.00 MACRS 7 663.54 86.17 749.71
Conversion - Albert's 08/93 400.00 MACRS 7 275.04 35.72 310.76
Scales - Theodore Scales 09/93 756.00 MACRS 7 519.81 67.51 587.32
Fryer recorder - AWC AL 09/93 1,575.75 MACRS 7 1,083.48 140.71 1,224.19
Contactor - Ladnier-Hardy 09/93 1,674.50 MACRS 7 1,151.40 149.53 1,300.93
Workman's Sheet & Plate 10/93 450.00 MACRS 7 309.44 40.19 349.63
(2) Prawnto Machines 01/03/94 800.00 MACRS 7 450.16 99.92 550.08
Mixer - White Fixtures 03/13/95 1,470.00 MACRS 7 570.06 257.10 827.16
Table - Cochran/Sysco 03/17/95 607.07 MACRS 7 235.42 106.18 341.60
Extruder - Thomas Marshall 03/24/95 3,000.00 MACRS 7 1,163.40 524.70 1,688.10
Tank Mixer - W. W. Grainger 08/16/95 385.84 MACRS 7 149.63 3.00 152.63
Platform Scale - Theodore Scales 10/25/95 498.75 MACRS 7 158.41 87.23 245.64
Extruder Spouts - Hinds Bock 1/2 & 1/31/96 2,047.30 MACRS 7 292.56 501.38 793.94
Conveyor Belt - Intralox 04/19/96 1,085.74 MACRS 7 155.15 265.90 421.05
Dock Levelor- ArrowStar 10/01/96 685.91 MACRS 7 98.02 167.98 266.00
Fryers/Heat Lamp - White Fixtures 10/21/96 567.00 MACRS 7 81.02 138.86 219.88
Pallet Jack - Clarklift 11/04/96 463.25 MACRS 7 66.20 113.45 179.65
Pallet Truck - ArrowStar 11/06/96 350.78 MACRS 7 50.13 85.91 136.04
SS Mixer - Rand 11/08/96 295.88 MACRS 7 42.28 72.46 114.74
--------- --------- -------- ---------
99,233.41 65,480.98 9,640.05 75,121.03
</TABLE>
<PAGE>
CoMar Foods 09-Sep-97
Depreciation 03:59 PM
1997
<TABLE>
<CAPTION>
Date Method/ A/D Depr. A/D
Acquired Cost Life 12/31/96 for 1997 12/31/97
-------- ---- ------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Plant-Cody Driscoll Rd. (175) 03/93 127,500.00 SL 31 1/2 15,515.84 4,047.62 19,563.46
Plant Improvements (176)
Southern Ready Mix 05/93 969.02 SL 39 74.55 24.85 99.40
Dixon Backhoe 05/93 1,328.00 SL 39 102.15 34.05 136.20
Willard Electric 06/93 8,837.57 SL 39 679.80 226.60 906.40
Baugh Construction 06/93 1,350.00 SL 39 103.86 34.62 138.48
Gerald Hayden - A/C slab 06/93 250.00 SL 39 19.23 6.41 25.64
Vernell Gillis - A/C frame 06/93 400.00 SL 39 30.78 10.26 41.04
Stevens Htg - Duct work 07/93 7,097.01 SL 39 545.91 181.97 727.88
Keith Mosley - Wall 07/93 4,425.00 SL 39 340.38 113.46 453.84
General Sht. - A/C cover 08/93 325.00 SL 39 24.99 8.33 33.32
Wimmer Tank - Septic System 02/96 2,000.00 SL 39 46.97 51.28 98.25
---------- ---------- --------- ----------
26,981.60 1,968.62 691.83 2,660.45
---------- ---------- --------- ----------
Totals 296,541.91 116,151.45 18,131.40 134,282.85
========== ========== ========= ==========
Land Improvements (178)
Clearing - Greg Landry 03/93 790.00 SL 15 201.91 52.67 254.58
Curtis Donnell - Fence 07/93 1,660.00 SL 15 332.01 110.67 442.68
---------- ---------- --------- ----------
2,450.00 533.92 163.34 697.26
Grand Total 298,991.91 116,685.37 18,294.74 134,980.11
========== ========== ========= ==========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
RUN DATE: 10/01/97 CoMar Foods, Inc. PAGE 1
RUN TIME: 12:36 PM
DETAIL TRIAL BALANCE
- ------------------------------------------------------------------------------------------------------------------------------------
ACCOUNT RANGE: 18601 TO 18603 PERIOD ENDING 09/30/97
- ---------ACCOUNT------------- -BEGINNING- -------------------------TRANSACTION------------------------ --ENDING--
NUMBER DESCRIPTION BALANCE DESCRIPTION DATE PP PE S REFERENCE AMOUNT BALANCE
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C><C> <C> <C> <C>
18601 Mobile Gas Deposit 125.00 0.00* 125.00*
18602 St. Elmo/Irvington Water 60.00 0.00* 60.00*
18603 General Interlease Corp 2,886.03 0.00* 2,886.03*
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*** End Of - DETAIL TRIAL BALANCE ***
<PAGE>
EXHIBIT B-1
- ------------------ ------------
VENDOR AMOUNT
- ------------------ ------------
Steiner - Interest thru 10/01/97 19,479.60
AmSouth - W/C loan 1,333.01
Payroll Taxes - 3rd Qtr 18,964.38
NLRB Settlement 7,338.34
John Carpenter- 25k + interest 27,021.92
Crow & Shields - fees @ closing 3,420.00
Ed Hyndman - fees @ closing 7,400.00
Accrued wages thru 09/30 4,924.39
AmSouth - Visa 433.01
---------
90,314.65
A/P:
All Temp A/C 206.00
Alterman 276.27
M. D. Bell 500.00
BellSouth Mobility 278.42
BOC Gases 2,247.26
Bryant Crab 1,760.00
Capital Pkg. 500.00
Classic Crab 440.00
Colonial Pacific Leasing 2,661.94
Crystal Mountain 73.94
Digital 142.26
Fruit Dist. 406.40
Gold Kist 1,392.50
GTE Mobilnet 1,200.00
Ingredients Corp. 523.32
IOE 2,348.50
Jubilee Foods 849.60
Ed McDonough 500.00
Merchants Co. 442.50
Mobile Fixture 204.93
George Naman 2,500.00
NewlyWeds Foods 680.25
NTFC Capital 717.64
Pel-Pak 629.55
Rand Materials 295.88
Roto-Rooter 430.00
Ryder 3,812.19
SAIA 619.98
Seafood Int'l 600.00
Southern Sfd 720.00
Tech Pak 391.00
EXHIBIT B-1
<PAGE>
EXHIBIT B-1
- ------------------ ------------
VENDOR AMOUNT
- ------------------ ------------
White Fixtures 259.70
Wilson & Sons 300.00
Young Pkg 775.32
----------
29,685.35
TOTAL 120,000.00
<PAGE>
EXHIBIT B-2
<TABLE>
<CAPTION>
--------- --------- --------- --------- --------- --------- ----------
Oct.'97 Nov. 97 Dec.'97 Jan.'98 Feb.'98 Mar.'98 Total
--------- --------- --------- --------- --------- --------- ----------
Vendor Payables:
<S> <C> <C> <C> <C> <C> <C> <C>
Batchelor's Service 230.00 230.00
BellSouth Mobility 278.42 278.42 556.84
BOC Gases 941.66 941.66 941.67 941.67 941.67 941.67 5,650.00
Capital Packaging 741.07 741.07 1,482.14
Crow & Shields, PC 2,000.00 2,000.00 1,950.00 5,950.00
GTE Mobilnet 1,000.00 967.55 1,967.55
Hand, Arendall 530.85 530.85 530.85 530.85 530.85 530.87 3,185.12
IOE 1,166.66 1,166.66 1,166.66 1,166.66 1,166.66 1,166.70 7,000.00
Ed McDonough 1,742.69 1,742.69 1,742.69 1,742.69 1,742.69 1,742.69 10,456.14
George Naman 1,800.00 1,800.00
NTFC Capital 181.96 181.96
Pel-Pak 629.57 629.57 629.57 1,888.71
Peformance Plastics 126.69 126.69
Roto-Rooter 430.00 430.00
Ryder Truck Rental 3,768.93 3,768.93
Sub-Total 15,568.50 8,998.47 6,961.44 4,381.87 4,381.87 4,381.93 44,674.08
Comm. - Food Sales of N.O. 3,300.00 3,300.00 3,300.00 3,300.00 3,300.00 3,300.00 19,800.00
Comm. - Conco Shrv. 493.88 479.76 973.64
0.00
Anticipated Vendor Savings (5,000.00) (5,000.00) (5,000.00) (5,000.00) (5,000.00) (5,000.00) (30,000.00)
0.00
Oct. P/R Taxes 1,122.00 1,122.00
John Carpenter 706.10 706.10 706.10 7,321.62 9,439.92
AmSouth - W/C 650.00 18,259.26 7,479.46 26,388.72
AmSouth - Visa 1,330.00 1,330.00
P/R Tax Penalty - 3rd Qtr. 1,025.00 1,025.00
Bay Marine 3,125.00 2,231.41 3,768.59 9,125.00
Frank Terrell 8,704.52 12,784.41 19,996.51 21,767.22 27,318.07 90,570.73
Custom Pack 5,550.91 5,550.91
Total 30,000.00 30,000.00 30,000.00 30,000.00 30,000.00 30,000.00 180,000.00
</TABLE>
<PAGE>
Exhibit B-3
Ronald O. Steiner $150,000.00
KBK Financial, Inc. 116,289.74
Exhibit B-3
<PAGE>
Exhibit F
None
Exhibit F
STATE OF FLORIDA
COUNTY OF __________________
CONTRACT
This agreement, made and entered into this day by and between DRAG N'
BAITS, INC., a Florida Corporation, hereinafter referred to as the "Seller", and
KILLER BEE, INC., a Mississippi Corporation, a wholly owned subsidiary of Global
Seafood Technologies, a Nevada Corporation, hereinafter referred to as the
"Purchaser",
WITNESSETH:
For and in consideration of the sum of $339,000.00 paid by the Purchaser to
the Seller, the receipt of which is hereby acknowledged, the Seller does hereby
agree to sell to the Purchaser, and the Purchaser agrees to purchase from the
Seller, for the amount and on the terms and conditions hereafter set out, the
following described assets, to-wit:
The inventory*, equipment, furniture, trade fixtures, and other tangible
personal property situated in the premises occupied by the Seller at 1250
Ocean View Avenue, Marathon, Florida more particularly described in Exhibit
"A" attached hereto and made a part hereof.
*Sellers inventory will be valued at the time of sale by a mutual taking of
the inventory by Seller and Buyer. (Said inventory to be valued at cost and
paid for separately by Purchaser at the time of sale).
Included in this sale, and as part of the purchase price, are the two boats
listed in Exhibit "A" which are owned by Marathon Boats, Inc., an affiliate of
Seller.
1. The purchase price for said property shall be the sum of Three Hundred
Thirty-Nine Thousand Dollars ($339,000.00), of which amount One Hundred
Thirty-Nine Thousand Dollars ($139,000.00) shall be paid in cash at closing. The
sum of One Hundred Thousand Dollars ($100,000.00) shall be paid within ninety
(90) days from the date of closing. The balance of purchase price in the amount
of One Hundred Thousand Dollars ($100,000.00) shall be paid within one hundred
eighty (180) days from the date of closing. Possession of the property is to be
<PAGE>
delivered upon closing with Purchaser, and the payment of the initial down
payment. The parties agree that for tax purposes, the initial payment of
$139,000.00 shall be allocated 100% to the boats being sold by Marathon Boats,
Inc.
2. Personal property taxes on equipment and inventory for the current year
shall be prorated at the time of closing.
3. Purchaser acknowledges that he has inspected the assets to be conveyed
and agrees to accept same in their present condition and state of repair. Seller
agrees that inventory levels at closing shall be substantially at present level,
without adjustment for sales in the normal course of business.
4. Seller warrants that they hold good and merchantable fee simple title in
and to the hereinabove described property, free and clear of all liens.
5. In the event the assets covered by this agreement are destroyed or
materially damaged by fire or other cause prior to closing, or in the event
inventory levels are changed outside the normal course of business, the
Purchaser shall have the option of terminating this Contract.
6. Title to said property shall be conveyed by good and sufficient Bill of
Sale free and clear of all liens and encumbrances.
7. Anything to the contrary not withstanding, there is and shall be
excluded from this Contract all accounts receivable and accounts payable of the
Seller, and all cash, bank deposits, and/or cash equivalence belonging to the
Seller, if made or incurred prior to the date of sale. Any sales or accounts
receivables made or incurred after the closing date shall belong to the
Purchaser.
8. It is understood that Five C's Fuel Dock, Inc., a Florida Corporation
and an affiliate of the Seller ("Lessor") shall lease the premises located at
1250 Ocean View Avenue,
<PAGE>
Marathon, Florida to Purchaser for the sum of $3,500.00 per month for five (5)
years with an option for an additional five (5) year lease; prior to the
expiration of the first five (5) years lease the Lessee shall advise in writing
to the Lessor as to whether or not Lessee wishes to exercise their additional
five (5) year lease option. Should Lessee not choose to exercise the second five
(5) year lease, said property will revert back to Lessor. Said lease shall
include the facility, office, and equipment that is not included in the sale,
that the monthly rent shall be prorated at the time of closing; and that the
Purchaser shall be responsible for all rents and rental agreements after the
date of closing. It is further agreed that the Purchaser shall be responsible
for all permits which may be required for the future operation of the business
in said premises.
(A) That Lessee agrees to pay a five (5%) percent increase in the rent each
year to begin after the first year, and a ten (10%) percent increase in the rent
each year to begin after the fifth year in the event the lease is renewed.
(B) If for any unforeseen cause, including but not limited to, a natural
disaster which substantially destroys the premises, and after the first thirty
(30) months of the lease term, a net ban or other adverse government statutes,
and/or regulation(s), or any other unforeseen cause beyond the control of
Purchaser that: would make the continued operation of the business incapable of
making a profit for the purchaser, the purchaser has the option to cancel the
lease of the building without penalty.
9. The Lessee/Purchaser shall carry liability insurance, insurance on the
contents of the leased property for protection of Lessee, Purchaser, and will
carry and/or reimburse Lessor for the cost of flood, wind, and casualty
insurance on the leased building as long as the facility is leased by Purchaser
and property is usable as a facility for packing bait. Each such policy will
name Lessor as an additional insured and loss payee and will not be changed or
terminated
<PAGE>
without thirty (30) days advance notice to Lessor. Lessor shall if he so chooses
carry liability insurance.
10. The Purchaser assumes no liabilities or debts of the Seller of any
nature. The Seller and Purchaser shall each be responsible for their own closing
expenses in connection with this transaction.
11. The Seller agrees to indemnify and hold harmless the Purchaser against
any loss, damages, suits, judgments, and expenses arising out of claims of any
third party for any taxes, services, contracts, or actions by Seller prior to
the closing date. Seller represents that it is not aware of any pending claims
nor basis for future claims which would affect the assets to be conveyed to the
Purchaser.
12. Purchaser shall be responsible for all utility services and claims
arising out of the conduct of the business after the closing date, and Purchaser
shall indemnify and hold Seller harmless in connection therewith.
13. The parties agree that neither the Seller nor the Purchaser have
retained the services of a broker in connection with this transaction and that
no brokerage commissions shall be due as a result thereof.
14. Delivery of the assets described herein shall be made to the Purchaser
at the time of closing, and payment of the initial down payment $139,000.00.
15. If within three (3) years of the closing, the large blast freezer box
rusts out due to salt water intrusion, the Seller will take the responsibility
for the large blast freezer box under the lease.
16. Seller and Gene Culmer, individually agree that they will not compete
directly or indirectly against the Purchaser for a period of ten (10) years.
That Purchaser shall pay the sum
<PAGE>
of $2,000.00 per month to Seller for ten (10) years for his agreement not to
compete. This would not preclude the seller from fishing for and selling bait,
which he may continue to do. Seller agrees to sell the bait, other than bait to
be sold to the fresh market, to Purchaser at market price. Seller is free to
sell his bait elsewhere if current market prices and conditions are not offered.
Should said lease be terminated the agreement not to compete shall end at that
the time of the termination of said lease.
17. The Seller does hereby specifically convey the exclusive right to use
the tradename, Drag N' Baits, Inc., together with all associated brand names,
trademarks, or other identifying marks of advertising of any kind or nature
associated with the Seller. If said lease is terminated by Purchaser said trade
name shall revert back to Seller if said lease is terminated within five (5)
years.
18. The Seller further agrees to convey to the Purchaser copies of their
customer lists and further authorizes the Purchaser to use said lists to
continue the sale of the products of the Seller to said customers.
19. To the extent not included in inventory the Seller further authorizes
the sale of all packing material including, but not limited to boxes, cans,
packages, and labels. This provision also includes all mailing and shipping
materials.
20. This sale shall be closed on or before JUNE 28, 1999. In the event the
Purchaser shall fail to complete his purchase of said property within the time
allowed, except for material damage to said property, all amounts paid hereunder
shall be forfeited to the Seller as liquidated damages and this Contract shall
be terminated and void.
21. The Seller shall maintain a security interest under the UCC and
appropriate Florida Law to secure the payment of the purchase price of the
personal property described in Exhibit "A". Upon final payment by the purchaser
to the Seller, all liens of the Seller, its successors
<PAGE>
and/or assigns shall immediately be released by the Seller.
22. This agreement shall be governed by, and construed in accordance with
the Laws of the State of Florida.
WITNESS OUR SIGNATURES this the _ day of _________________, 1999.
BY:
--------------------------------
DRAG N' BAITS, INC.
By: GENE CULMER, President
Seller
/s/ BRENT GUTIERREZ, President /s/ CLAY GUTIERREZ, President
- --------------------------------- ----------------------------------
GLOBAL SEAFOOD TECHNOLOGIES, KILLER BEE, INC., Purchaser
BY: BRENT GUTIERREZ, President BY: CLAY GUTIERREZ, President
<PAGE>
<TABLE>
<CAPTION>
DRAG N BAIT INVENTORY
<S> <C> <C> <C> <C> <C> <C>
SALT 38 $ 4.40 $ 162.90 Supplies
SODIUM 56 $ 9.80 $ 548.80 Supplies
ICE BAGS 1 $ 0.00 $ 0.00 New Eqpt 139,000 1160-70 nl
OIL 5 GAL 3 $ 23.78 $ 71.33 Oil-Boats
HYD OIL 5 GAL 1 $ 20.03 $ 20.03 Oil-Boats
2 CYCLE OIL 1 QT 4 $ 20.28 $ 84.48 Supplies
SUPER PLUS 40 0 2 $ 30.75 $ 53.81 Supplies
TEA 57 $ 0.33 $ 18.78 Supplies
MT. DEW 32 $ 0.33 $ 10.53 Supplies
ROOT BEER 25 $ 0.33 $ 8.23 Supplies
DIET PEPSI 24 $ 0.33 $ 7.90 Supplies
7 UP 23 $ 0.33 $ 7.57 Supplies 1,827.00 1810-10 ppI
DR PEPPER 10 $ 0.33 $ 3.29 Supplies 426.06 6675-10 Bmt Eip
ORANGE 50 $ 0.33 $ 16.46 Supplies 1897.70 6631-10 Sup. Promot.
PEPSI 50 $ 0.33 $ 16.46 Supplies 1079.34 6630-10 Supplies
BANNER 21 $ 83.70 Supplies 37,049.10 6634-10 Packaging
CHANGE LEFT IN $ 1,757.70 Supplies Promotional 21,292.05 1150-10 Inventory
COKE MACHINE $ 30.00 Supplies
63,571.25
TOTAL INVENTORY $61,744.26
INSURANCE PAID
FLOOD $ 894.00 Prepaid Insurance
WINDSTORM $ 933.00 Prepaid Insurance
</TABLE>
TOTAL $63,571.25
*THIS DOES NOT INCLUDE ANY COST FOR THE FREEZERS, STRAPS, MAINTENACE OR ICE
<PAGE>
DRAG N BAIT INVENTORY
<TABLE>
<CAPTION>
CASE TOTAL
INVENTORY INCOMPLETE INVENTORY BALLYHOO QTY PER CASE COST PER COST PER LABOR HOOK & COST COST
ITEM 6/22/99 CASE COST COST EACH CASE COST BOXES BAGS PER CASE WIRE COST BAG
- ---- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
EXTRA SMALL 23 11 $ 862.30 $0.10 192 $19.20 $0.88 $ 2.64 $ 5.24 $ 0.00 $27.96 $1.75
SMALL 171 9 $ 3,977.73 $0.10 144 $14.40 $0.88 $ 2.64 $ 5.24 $ 0.00 $23.16 $1.93
MED 3 0 $ 75.66 $0.14 120 $16.80 $0.88 $ 2.30 $ 5.24 $ 0.00 $25.22 $2.52
LARGE 0 0 $ 0.00 $0.14 96 $13.44 $0.88 $ 1.84 $ 5.24 $ 0.00 $21.40 $2.68
JUMBO 0 0 $ 0.00 $0.18 60 $10.80 $0.88 $ 6.90 $ 5.24 $ 0.00 $23.82 $0.79
BULK 5LBS 250 0 $ 3,630.00 $1.00 8 $ 8.00 $0.88 $ 0.40 $ 5.24 $ 0.00 $14.52 $1.82
CHUM 418 0 $ 6,069.36 $1.00 8 $12.60 $0.88 $ 0.40 $ 5.24 $ 0.00 $14.52 $1.82
MED 1 HOOK 16 7 $ 1,150.29 $0.14 90 $12.60 $0.88 $ 6.90 $17.18 $33.30 $70.86 $2.36
MED 2 HOOK 40 4 $ 3,764.11 $0.14 90 $12.60 $0.88 $ 6.90 $32.91 $40.50 $93.79 $3.13
MED 1 HOOK MON 4 0 $ 231.24 $0.14 90 $10.08 $0.88 $ 6.90 $17.18 $20.25 $57.81 $1.93
FLYING FISH 49 16 $ 1,683.40 $0.14 72 $ 0.00 $0.88 $18.00 $ 5.24 $ 0.00 $34.20 $0.48
25LBS SQUID 4 0 $ 3.72 $0.00 25LB $ 0.00 $0.88 $ 0.05 $ 0.00 $ 0.00 $ 0.93 $0.93
LARGE SQUID 1 0 $ 6.40 $ 5.52 $ 0.00 $6.40
RAW MATERIAL C1 43 0 $ 37.84 $0.00 30LBS $0.88 $0.88
</TABLE>
TOTAL BAIT INVENTORY $ 21,292.05 Inventory
<TABLE>
<CAPTION>
QTY COST EACH TOTAL
<S> <C> <C> <C>
BOXES TOPS 1991 $ 0.42 $ 836.22 Packaging Material
BOXES BOTTOMS 1819 $ 0.46 $ 836.74 Packaging Material
SMALL BAGS 45030 $ 0.23 $10,356.90 Packaging Material
MED BAGS 81030 $ 0.22 $17,745.57 Packaging Material
JUMBO BAGS 14160 $ 0.21 $ 3,001.92 Packaging Material
SHIRTS 64 $ 6.00 $ 384.00 Packaging Material
HATS 10 $ 4.50 $ 45.00 Supplies Promotional
JACKETS 0 $39.00 $ 0.00
2 HOOK RIGGED 7075 $ 0.45 $ 3,183.75 Packaging Material
WIRE 80 $ 8.80 $ 704.00 Packaging Material
COOLIE CUPS 100 $ 0.95 $ 95.00 Supplies Promotional
SHRINK WRAP 1 $34.70 $ 26.03 Supplies
300 GAL FUEL 300 $ 0.65 $ 196.42 Fuel-Boats
STRAPPING ROLL 2 $52.05 $ 104.10 Supplies
STAPLES 2 $44.25 $ 99.56 Supplies
PAPER BAGS 1 $25.00 $ 18.75 Supplies
</TABLE>
EXHIBIT 21
LIST OF SUBSIDIARIES
Name Date of Incorporation State of Incorporation
- ---- --------------------- ----------------------
CoMar Foods, Inc. February 26, 1993 Alabama
Custom Pack, Inc. February 15, 1988 Mississippi
Killer Bee, Inc. September 18, 1998 Mississippi
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0001080533
<NAME> Global Seafood
<S> <C>
<PERIOD-TYPE> 6-mos
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,962,321
<SECURITIES> 0
<RECEIVABLES> 1,058,363
<ALLOWANCES> 0
<INVENTORY> 502,125
<CURRENT-ASSETS> 3,783,576
<PP&E> 3,031,028
<DEPRECIATION> (2,375,320)
<TOTAL-ASSETS> 6,846,918
<CURRENT-LIABILITIES> 938,373
<BONDS> 0
0
200
<COMMON> 0
<OTHER-SE> 4,426,949
<TOTAL-LIABILITY-AND-EQUITY> 6,846,918
<SALES> 7,546,442
<TOTAL-REVENUES> 7,546,442
<CGS> 4,753,155
<TOTAL-COSTS> 2,844,854
<OTHER-EXPENSES> 38,987
<LOSS-PROVISION> 90,554
<INTEREST-EXPENSE> 74,672
<INCOME-PRETAX> (90,554)
<INCOME-TAX> 918
<INCOME-CONTINUING> (91,472)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (91,472)
<EPS-BASIC> (.01)
<EPS-DILUTED> (.01)
</TABLE>
