UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS
Pursuant to Section 12(b) or (g) of the Securities and Exchange
Act of 1934
BACH-HAUSER, INC.
(Exact name of registrant as specified in its charter)
Nevada 88-0390697
(State of organization) (I.R.S. Employer Identification No.)
3675 Pecos-McLeod, Suite 1400, Las Vegas, NV 89121
(Address of principal executive offices)
Registrant's telephone number, including area code (702) 866-2500
Registrant's Attorney: Daniel G. Chapman, Esq., 2080 E. Flamingo
Road, Suite 112, Las Vegas, NV 89119
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, $0.001 par value per share
ITEM 1. DESCRIPTION OF BUSINESS
Background
Bach-Hauser, Inc. (the "Company") is a Nevada corporation formed
on October 10, 1995. Its principal place of business is located
at 3675 Pecos-McLeod, Suite 1400, Las Vegas, NV 89121. The
Company was organized to engage in any lawful corporate business,
including but not limited to, participating in mergers with and
acquisitions of other companies. The Company has been in the
developmental stage since inception and has no operating history
other than organizational matters.
On October 16, 1995, the Company issued 6,000,000 shares of its
Common Stock, at a price of $0.001 per share, to its three
founders. The initial founders gifted some of their shares to a
total of 5 persons, who then gifted some of their shares to a
total of 23 additional persons. All of these transfers were
issued in accordance with the exemption from registration
requirements of Section 5 of the Securities Exchange Act of 1934,
as amended, as provided in Section 4 of the Act.
On April 29, 1999, the Company approved reorganizing the capital
structure by forward splitting the outstanding shares of the
corporation on a 2.5:1. The forward split had a net result of
7,500,000 shares held by non-officers and 7,500,000 restricted
shares held by officers for a total of 15,000,000 issued and
outstanding shares.
The primary activity of the Company currently involves seeking a
company or companies that it can acquire or with whom it can
merge. The Company has not selected any company as an acquisition
target or merger partner and does not intend to limit potential
candidates to any particular field or industry, but does retain
the right to limit candidates, if it so chooses, to a particular
field or industry. The Company's plans are in the conceptual
stage only.
The Board of Directors has elected to begin implementing the
Company's principal business purpose, described below under "Item
2, Plan of Operation". As such, the Company can be defined as a
"shell" company, whose sole purpose at this time is to locate and
consummate a merger or acquisition with a private entity.
The proposed business activities described herein classify the
Company as a "blank check" company. Many states have enacted
statutes, rules, and regulations limiting the sale of securities
of "blank check" companies in their respective jurisdictions.
Management does not intend to undertake any efforts to cause a
market to develop in the Company's securities until such time as
the Company has successfully implemented its business plan.
The Company is filing this registration statement on a voluntary
basis, pursuant to section 12(g) of the Securities Exchange Act
of 1934 (the "Exchange Act"), in order to ensure that public
information is readily accessible to all shareholders and
potential investors, and to increase the Company's access to
financial markets, and in order to adhere to the new Eligibility
Rules adopted by the NASD. In the event the Company's obligation
to file periodic reports is suspended pursuant to the Exchange
Act, the Company anticipates that it will continue to voluntarily
file such reports.
Risk Factors
The Company's business is subject to numerous risk factors,
including the following:
NO OPERATING HISTORY OR REVENUE AND MINIMAL ASSETS. The Company
has had no operating history and has received no revenues or
earnings from operations. The Company has no significant assets
or financial resources. The Company will, in all likelihood,
sustain operating expenses without corresponding revenues, at
least until it completes a business combination. This may result
in the Company incurring a net operating loss which will increase
continuously until the Company completes a business combination
with a profitable business opportunity. There is no assurance
that the Company will identify a business opportunity or complete
a business combination.
SPECULATIVE NATURE OF COMPANY'S PROPOSED OPERATIONS. The success
of the Company's proposed plan of operation will depend to a
great extent on the operations, financial condition, and
management of the identified business opportunity. While
management intends to seek business combinations with entities
having established operating histories, it cannot assure that the
Company will successfully locate candidates meeting such
criteria. In the event the Company completes a business
combination, the success of the Company's operations may be
dependent upon management of the successor firm or venture
partner firm together with numerous other factors beyond the
Company's control.
SCARCITY OF AND COMPETITION FOR BUSINESS OPPORTUNITIES AND
COMBINATIONS. The Company is, and will continue to be, an
insignificant participant in the business of seeking mergers and
joint ventures with, and acquisitions of small private entities.
A large number of established and well-financed entities,
including venture capital firms, are active in mergers and
acquisitions of companies which may also be desirable target
candidates for the Company. Nearly all such entities have
significantly greater financial resources, technical expertise,
and managerial capabilities than the Company. The Company is,
consequently, at a competitive disadvantage in identifying
possible business opportunities and successfully completing a
business combination. Moreover, the Company will also compete
with numerous other small public companies in seeking merger or
acquisition candidates.
NO AGREEMENT FOR BUSINESS COMBINATION OR OTHER TRANSACTION - NO
STANDARDS FOR BUSINESS COMBINATION. The Company has no
arrangement, agreement, or understanding with respect to engaging
in a business combination with any private entity. There can be
no assurance the Company will successfully identify and evaluate
suitable business opportunities or conclude a business
combination. Management has not identified any particular
industry or specific business within an industry for evaluations.
The Company has been in the developmental stage since inception
and has no operations to date. Other than issuing shares to its
original shareholders, the Company never commenced any
operational activities. There is no assurance the Company will be
able to negotiate a business combination on terms favorable to
the Company. The Company has not established a specific length of
operating history or a specified level of earnings, assets, net
worth or other criteria which it will require a target business
opportunity to have achieved, and without which the Company would
not consider a business combination in any form with such
business opportunity. Accordingly, the Company may enter into a
business combination with a business opportunity having no
significant operating history, losses, limited or no potential
for earnings, limited assets, negative net worth, or other
negative characteristics.
CONTINUED MANAGEMENT CONTROL, LIMITED TIME AVAILABILITY. While
seeking a business combination, management anticipates devoting
up to twenty hours per month to the business of the Company. The
Company's officers have not entered into written employment
agreements with the Company and are not expected to do so in the
foreseeable future. The Company has not obtained key man life
insurance on its officers or directors. Notwithstanding the
combined limited experience and time commitment of management,
loss of the services of any of these individuals would adversely
affect development of the Company's business and its likelihood
of continuing operations. See "MANAGEMENT."
CONFLICTS OF INTEREST - GENERAL. The Company's officers and
directors participate in other business ventures which compete
directly with the Company. Additional conflicts of interest and
non "arms-length" transactions may also arise in the event the
Company's officers or directors are involved in the management of
any firm with which the Company transacts business. The Company's
Board of Directors has adopted a resolution which prohibits the
Company from completing a combination with any entity in which
management serve as officers, directors or partners, or in which
they or their family members own or hold any ownership interest.
Management is not aware of any circumstances under which this
policy could be changed while current management is in control of
the Company. See "Item 5". DIRECTORS, EXECUTIVE OFFICERS,
PROMOTERS AND CONTROL PERSONS - CONFLICTS OF INTEREST."
REPORTING REQUIREMENTS MAY DELAY OR PRECLUDE ACQUISITION.
Companies subject to Section 13 of the Securities Exchange Act of
1934 (the "Exchange Act") must provide certain information about
significant acquisitions, including certified financial
statements for the company acquired, covering one or two years,
depending on the relative size of the acquisition. The time and
additional costs that may be incurred by some target entities to
prepare such statements may significantly delay or even preclude
the Company from completing an otherwise desirable acquisition.
Acquisition prospects that do not have or are unable to obtain
the required audited statements may not be appropriate for
acquisition so long as the reporting requirements of the 1934 Act
are applicable.
LACK OF MARKET RESEARCH OR MARKETING ORGANIZATION. The Company
has not conducted or received results of market research
indicating that market demand exists for the transactions
contemplated by the Company. Moreover, the Company does not have,
and does not plan to establish, a marketing organization. If
there is demand for a business combination as contemplated by the
Company, there is no assurance the Company will successfully
complete such transaction.
LACK OF DIVERSIFICATION. In all likelihood, the Company's
proposed operations, even if successful, will result in a
business combination with only one entity. Consequently, the
resulting activities will be limited to that entity's business.
The Company's inability to diversify its activities into a number
of areas may subject the Company to economic fluctuations within
a particular business or industry, thereby increasing the risks
associated with the Company's operations.
REGULATION. Although the Company will be subject to regulation
under the Securities Exchange Act of 1934, management believes
the Company will not be subject to regulation under the
Investment Company Act of 1940, insofar as the Company will not
be engaged in the business of investing or trading in securities.
In the event the Company engages in business combinations which
result in the Company holding passive investment interests in a
number of entities, the Company could be subject to regulation
under the Investment Company Act of 1940. In such event, the
Company would be required to register as an investment company
and could be expected to incur significant registration and
compliance costs. The Company has obtained no formal
determination from the Securities and Exchange Commission as to
the status of the Company under the Investment Company Act of
1940 and, consequently, any violation of such Act would subject
the Company to material adverse consequences.
PROBABLE CHANGE IN CONTROL AND MANAGEMENT. A business combination
involving the issuance of the Company's common stock will, in all
likelihood, result in shareholders of a private company obtaining
a controlling interest in the Company. Any such business
combination may require management of the Company to sell or
transfer all or a portion of the Company's common stock held by
them, or resign as members of the Board of Directors of the
Company. The resulting change in control of the Company could
result in removal of one or more present officers and directors
of the Company and a corresponding reduction in or elimination of
their participation in the future affairs of the Company.
REDUCTION OF PERCENTAGE SHARE OWNERSHIP FOLLOWING BUSINESS
COMBINATION. The Company's primary plan of operation is based
upon a business combination with a private concern which, in all
likelihood, would result in the Company issuing securities to
shareholders of such private company. Issuing previously
authorized and unissued common stock of the Company will reduce
the percentage of shares owned by present and prospective
shareholders, and a change in the Company's control and/or
management.
DISADVANTAGES OF BLANK CHECK OFFERING. The Company may enter into
a business combination with an entity that desires to establish a
public trading market for its shares. A target company may
attempt to avoid what it deems to be adverse consequences of
undertaking its own public offering by seeking a business
combination with the Company. The perceived adverse consequences
may include, but are not limited to, time delays of the
registration process, significant expenses to be incurred in such
an offering, loss of voting control to public shareholders, and
the inability or unwillingness to comply with various federal and
state securities laws enacted for the protection of investors.
These securities laws primarily relate to registering securities
and full disclosure of the Company's business, management, and
financial statements.
TAXATION. Federal and state tax consequences will, in all
likelihood, be major considerations in any business combination
the Company may undertake. Typically, these transactions may be
structured to result in tax-free treatment to both companies,
pursuant to various federal and state tax provisions. The Company
intends to structure any business combination so as to minimize
the federal and state tax consequences to both the Company and
the target entity. Management cannot assure that a business
combination will meet the statutory requirements for a tax-free
reorganization, or that the parties will obtain the intended tax-
free treatment upon a transfer of stock or assets. A non-
qualifying reorganization could result in the imposition of both
federal and state taxes, which may have an adverse effect on both
parties to the transaction.
REQUIREMENT OF AUDITED FINANCIAL STATEMENTS MAY DISQUALIFY
BUSINESS OPPORTUNITIES. Management believes that any potential
target company must provide audited financial statements for
review, and for the protection of all parties to the business
combination. One or more attractive business opportunities may
forego a business combination with the Company, rather than incur
the expenses associated with preparing audited financial
statements.
BLUE SKY CONSIDERATIONS. Because the securities registered
hereunder have not been registered for resale under the blue sky
laws of any state, and the Company has no current plans to
register or qualify its shares in any state, holders of these
shares and persons who desire to purchase them in any trading
market that might develop in the future, should be aware that
there may be significant state blue sky restrictions upon the
ability of new investors to purchase the securities. These
restrictions could reduce the size of any potential market. As a
result of recent changes in federal law, non-issuer trading or
resale of the Company's securities is exempt from state
registration or qualification requirements in most states.
However, some states may continue to restrict the trading or
resale of blind-pool or "blank-check" securities. Accordingly,
investors should consider any potential secondary market for the
Company's securities to be a limited one.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
NOTE REGARDING PROJECTIONS AND FORWARD LOOKING STATEMENTS
This statement includes projections of future results and
"forward-looking statements" as that term is defined in Section
27A of the Securities Act of 1933 as amended (the "Securities
Act"), and Section 21E of the Securities Exchange Act of 1934 as
amended (the "Exchange Act"). All statements that are included in
this Registration Statement, other than statements of historical
fact, are forward-looking statements. Although Management
believes that the expectations reflected in these forward-looking
statements are reasonable, it can give no assurance that such
expectations will prove to have been correct. Important factors
that could cause actual results to differ materially from the
expectations are disclosed in this Statement, including, without
limitation, in conjunction with those forward-looking statements
contained in this Statement.
Plan of Operation - General
The Company's plan is to seek, investigate, and if such
investigation warrants, acquire an interest in one or more
business opportunities presented to it by persons or firms
desiring the perceived advantages of a publicly held corporation.
At this time, the Company has no plan, proposal, agreement,
understanding, or arrangement to acquire or merge with any
specific business or company, and the Company has not identified
any specific business or company for investigation and
evaluation. No member of Management or any promoter of the
Company, or an affiliate of either, has had any material
discussions with any other company with respect to any
acquisition of that company. The Company will not restrict its
search to any specific business, industry, or geographical
location, and may participate in business ventures of virtually
any kind or nature. Discussion of the proposed business under
this caption and throughout this Registration Statement is
purposefully general and is not meant to restrict the Company's
virtually unlimited discretion to search for and enter into a
business combination.
The Company may seek a combination with a firm which only
recently commenced operations, or a developing company in need of
additional funds to expand into new products or markets or
seeking to develop a new product or service, or an established
business which may be experiencing financial or operating
difficulties and needs additional capital which is perceived to
be easier to raise by a public company. In some instances, a
business opportunity may involve acquiring or merging with a
corporation which does not need substantial additional cash but
which desires to establish a public trading market for its common
stock. The Company may purchase assets and establish wholly-owned
subsidiaries in various businesses or purchase existing
businesses as subsidiaries.
Selecting a business opportunity will be complex and extremely
risky. Because of general economic conditions, rapid
technological advances being made in some industries, and
shortages of available capital, management believes that there
are numerous firms seeking the benefits of a publicly-traded
corporation. Such perceived benefits of a publicly traded
corporation may include facilitating or improving the terms on
which additional equity financing may be sought, providing
liquidity for the principals of a business, creating a means for
providing incentive stock options or similar benefits to key
employees, providing liquidity (subject to restrictions of
applicable statutes) for all shareholders, and other items.
Potentially available business opportunities may occur in many
different industries and at various stages of development, all of
which will make the task of comparative investigation and
analysis of such business opportunities extremely difficult and
complex.
Management believes that the Company may be able to benefit from
the use of "leverage" to acquire a target company. Leveraging a
transaction involves acquiring a business while incurring
significant indebtedness for a large percentage of the purchase
price of that business. Through leveraged transactions, the
Company would be required to use less of its available funds to
acquire a target company and, therefore, could commit those funds
to the operations of the business, to combinations with other
target companies, or to other activities. The borrowing involved
in a leveraged transaction will ordinarily be secured by the
assets of the acquired business. If that business is not able to
generate sufficient revenues to make payments on the debt
incurred by the Company to acquire that business, the lender
would be able to exercise the remedies provided by law or by
contract. These leveraging techniques, while reducing the amount
of funds that the Company must commit to acquire a business, may
correspondingly increase the risk of loss to the Company. No
assurance can be given as to the terms or availability of
financing for any acquisition by the Company. During periods when
interest rates are relatively high, the benefits of leveraging
are not as great as during periods of lower interest rates,
because the investment in the business held on a leveraged basis
will only be profitable if it generates sufficient revenues to
cover the related debt and other costs of the financing. Lenders
from which the Company may obtain funds for purposes of a
leveraged buy-out may impose restrictions on the future
borrowing, distribution, and operating policies of the Company.
It is not possible at this time to predict the restrictions, if
any, which lenders may impose, or the impact thereof on the
Company.
The Company has insufficient capital with which to provide the
owners of businesses significant cash or other assets. Management
believes the Company will offer owners of businesses the
opportunity to acquire a controlling ownership interest in a
public company at substantially less cost than is required to
conduct an initial public offering. The owners of the businesses
will, however, incur significant post-merger or acquisition
registration costs in the event they wish to register a portion
of their shares for subsequent sale. The Company will also incur
significant legal and accounting costs in connection with the
acquisition of a business opportunity, including the costs of
preparing post-effective amendments, Forms 8-K, agreements, and
related reports and documents. Nevertheless, the officers and
directors of the Company have not conducted market research and
are not aware of statistical data which would support the
perceived benefits of a merger or acquisition transaction for the
owners of a businesses. The Company does not intend to make any
loans to any prospective merger or acquisition candidates or to
unaffiliated third parties.
The Company will not restrict its search for any specific kind of
firms, but may acquire a venture which is in its preliminary or
development stage, which is already in operation, or in
essentially any stage of its corporate life. It is impossible to
predict at this time the status of any business in which the
Company may become engaged, in that such business may need to
seek additional capital, may desire to have its shares publicly
traded, or may seek other perceived advantages which the Company
may offer. However, the Company does not intend to obtain funds
in one or more private placements to finance the operation of any
acquired business opportunity until such time as the Company has
successfully consummated such a merger or acquisition. The
Company also has no plans to conduct any offerings under
Regulation S.
Sources of Opportunities
The Company will seek a potential business opportunity from all
known sources, but will rely principally on personal contacts of
its officers and directors as well as indirect associations
between them and other business and professional people. It is
not presently anticipated that the Company will engage
professional firms specializing in business acquisitions or
reorganizations.
Management, while not especially experienced in matters relating
to the new business of the Company, will rely upon their own
efforts and, to a much lesser extent, the efforts of the
Company's shareholders, in accomplishing the business purposes of
the Company. It is not anticipated that any outside consultants
or advisors, other than the Company's legal counsel and
accountants, will be utilized by the Company to effectuate its
business purposes described herein. However, if the Company does
retain such an outside consultant or advisor, any cash fee earned
by such party will need to be paid by the prospective
merger/acquisition candidate, as the Company has no cash assets
with which to pay such obligation. There have been no
discussions, understandings, contracts or agreements with any
outside consultants and none are anticipated in the future. In
the past, the Company's management has never used outside
consultants or advisors in connection with a merger or
acquisition.
As is customary in the industry, the Company may pay a finder's
fee for locating an acquisition prospect. If any such fee is
paid, it will be approved by the Company's Board of Directors and
will be in accordance with the industry standards. Such fees are
customarily between 1% and 5% of the size of the transaction,
based upon a sliding scale of the amount involved. Such fees are
typically in the range of 5% on a $1,000,000 transaction ratably
down to 1% in a $4,000,000 transaction. Management has adopted a
policy that such a finder's fee or real estate brokerage fee
could, in certain circumstances, be paid to any employee,
officer, director or 5% shareholder of the Company, if such
person plays a material role in bringing a transaction to the
Company.
The Company will not have sufficient funds to undertake any
significant development, marketing, and manufacturing of any
products which may be acquired. Accordingly, if it acquires the
rights to a product, rather than entering into a merger or
acquisition, it most likely would need to seek debt or equity
financing or obtain funding from third parties, in exchange for
which the Company would probably be required to give up a
substantial portion of its interest in any acquired product.
There is no assurance that the Company will be able either to
obtain additional financing or to interest third parties in
providing funding for the further development, marketing and
manufacturing of any products acquired.
Evaluation of Opportunities
The analysis of new business opportunities will be undertaken by
or under the supervision of the officers and directors of the
Company (see "Item 5"). Management intends to concentrate on
identifying prospective business opportunities which may be
brought to its attention through present associations with
management. In analyzing prospective business opportunities,
management will consider, among other factors, such matters as;
1. the available technical, financial and managerial resources
2. working capital and other financial requirements
3. history of operation, if any
4. prospects for the future
5. present and expected competition
6. the quality and experience of management services which may
be available and the depth of that management
7. the potential for further research, development or
exploration
8. specific risk factors not now foreseeable but which then may
be anticipated to impact the proposed activities of the Company
9. the potential for growth or expansion
10. the potential for profit
11. the perceived public recognition or acceptance of products,
services or trades
12. name identification
Management will meet personally with management and key personnel
of the firm sponsoring the business opportunity as part of their
investigation. To the extent possible, the Company intends to
utilize written reports and personal investigation to evaluate
the above factors. The Company will not acquire or merge with any
company for which audited financial statements cannot be
obtained.
Opportunities in which the Company participates will present
certain risks, many of which cannot be identified adequately
prior to selecting a specific opportunity. The Company's
shareholders must, therefore, depend on Management to identify
and evaluate such risks. Promoters of some opportunities may have
been unable to develop a going concern or may present a business
in its development stage (in that it has not generated
significant revenues from its principal business activities prior
to the Company's participation.) Even after the Company's
participation, there is a risk that the combined enterprise may
not become a going concern or advance beyond the development
stage. Other opportunities may involve new and untested products,
processes, or market strategies which may not succeed. Such risks
will be assumed by the Company and, therefore, its shareholders.
The investigation of specific business opportunities and the
negotiation, drafting, and execution of relevant agreements,
disclosure documents, and other instruments will require
substantial management time and attention as well as substantial
costs for accountants, attorneys, and others. If a decision is
made not to participate in a specific business opportunity the
costs incurred in the related investigation would not be
recoverable. Furthermore, even if an agreement is reached for the
participation in a specific business opportunity, the failure to
consummate that transaction may result in the loss by the Company
of the related costs incurred.
There is the additional risk that the Company will not find a
suitable target. Management does not believe the Company will
generate revenue without finding and completing a transaction
with a suitable target company. If no such target is found,
therefore, no return on an investment in the Company will be
realized, and there will not, most likely, be a market for the
Company's stock.
Acquisition of Opportunities
In implementing a structure for a particular business
acquisition, the Company may become a party to a merger,
consolidation, reorganization, joint venture, franchise, or
licensing agreement with another corporation or entity. It may
also purchase stock or assets of an existing business. Once a
transaction is complete, it is possible that the present
management and shareholders of the Company will not be in control
of the Company. In addition, a majority or all of the Company's
officers and directors may, as part of the terms of the
transaction, resign and be replaced by new officers and directors
without a vote of the Company's shareholders.
It is anticipated that securities issued in any such
reorganization would be issued in reliance on exemptions from
registration under applicable Federal and state securities laws.
In some circumstances, however, as a negotiated element of this
transaction, the Company may agree to register such securities
either at the time the transaction is consummated, under certain
conditions, or at specified time thereafter. The issuance of
substantial additional securities and their potential sale into
any trading market which may develop in the Company's Common
Stock may have a depressive effect on such market.
While the actual terms of a transaction to which the Company may
be a party cannot be predicted, it may be expected that the
parties to the business transaction will find it desirable to
avoid the creation of a taxable event and thereby structure the
acquisition in a so called "tax free" reorganization under
Sections 368(a)(1) or 351 of the Internal Revenue Code of 1986,
as amended (the "Code"). In order to obtain tax free treatment
under the Code, it may be necessary for the owners of the
acquired business to own 80% or more of the voting stock of the
surviving entity. In such event, the shareholders of the Company,
including investors in this offering, would retain less than 20%
of the issued and outstanding shares of the surviving entity,
which could result in significant dilution in the equity of such
shareholders.
As part of the Company's investigation, officers and directors of
the Company will meet personally with management and key
personnel, may visit and inspect material facilities, obtain
independent analysis or verification of certain information
provided, check references of management and key personnel, and
take other reasonable investigative measures, to the extent of
the Company's limited financial resources and management
expertise.
The manner in which the Company participates in an opportunity
with a target company will depend on the nature of the
opportunity, the respective needs and desires of the Company and
other parties, the management of the opportunity, and the
relative negotiating strength of the Company and such other
management.
With respect to any mergers or acquisitions, negotiations with
target company management will be expected to focus on the
percentage of the Company which the target company's shareholders
would acquire in exchange for their shareholdings in the target
company. Depending upon, among other things, the target company's
assets and liabilities, the Company's shareholders will, in all
likelihood, hold a lesser percentage ownership interest in the
Company following any merger or acquisition. The percentage
ownership may be subject to significant reduction in the event
the Company acquires a target company with substantial assets.
Any merger or acquisition effected by the Company can be expected
to have a significant dilutive effect on the percentage of shares
held by the Company's then shareholders, including purchasers in
this offering.
Management has advanced, and will continue to advance, funds
which shall be used by the Company in identifying and pursuing
agreements with target companies. Management anticipates that
these funds will be repaid from the proceeds of any agreement
with the target company, and that any such agreement may, in
fact, be contingent upon the repayment of those funds.
Competition
The Company is an insignificant participant among firms which
engage in business combinations with, or financing of,
development-stage enterprises. There are many established
management and financial consulting companies and venture capital
firms which have significantly greater financial and personal
resources, technical expertise and experience than the Company.
In view of the Company's limited financial resources and
management availability, the Company will continue to be at
significant competitive disadvantage vis-a-vis the Company's
competitors.
Year 2000 Compliance
The Company is aware of the issues associated with the
programming code in existing computer systems as the year 2000
approaches. The Company has assessed these issues as they relate
to the Company, and since the Company currently has no operating
business and does not use any computers, and since it has no
customers, suppliers or other constituents, it does not believe
that there are any material year 2000 issues to disclose in this
Form 10-SB.
Regulation and Taxation
The Investment Company Act of 1940 defines an "investment
company" as an issuer which is or holds itself out as being
engaged primarily in the business of investing, reinvesting or
trading securities. While the Company does not intend to engage
in such activities, the Company may obtain and hold a minority
interest in a number of development stage enterprises. The
Company could be expected to incur significant registration and
compliance costs if required to register under the Investment
Company Act of 1940. Accordingly, management will continue to
review the Company's activities from time to time with a view
toward reducing the likelihood the Company could be classified as
an "investment company".
The Company intends to structure a merger or acquisition in such
manner as to minimize Federal and state tax consequences to the
Company and to any target company.
Employees
The Company's only employees at the present time are its officers
and directors, who will devote as much time as the Board of
Directors determine is necessary to carry out the affairs of the
Company. (See "Item 5").
ITEM 3. DESCRIPTION OF PROPERTY.
The Company neither owns nor leases any real property at this
time. The Company does have the use of a limited amount of office
space located at 3675 Pecos-McLeod, Suite 1400, Las Vegas, NV
89121, at no cost to the Company, and Management expects this
arrangement to continue. The Company pays its own charges for
long distance telephone calls and other miscellaneous
secretarial, photocopying, and similar expenses.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
The following table sets forth each person known to the Company,
as of June 15, 1999, to be a beneficial owner of five percent
(5%) or more of the Company's common stock, by the Company's
directors individually, and by all of the Company's directors and
executive officers as a group. Except as noted, each person has
sole voting and investment power with respect to the shares
shown. (Note: Other than management, no other individuals hold
more than 5% of the Company's common stock.)
<TABLE>
<S> <C> <C> <C>
Title of Name/Address Shares Percentage
Class of Owner Beneficially Ownership
Owned
Common Bobby Combs 2,500,000 16.67%
6669 Five Pennies
Circle
Las Vegas, NV 89129
Common Charles F. Richards, 2,500,000 16.67%
Jr.
1903 Orange Blvd.
Palm Harbor, FL 34683
Common David L. Christensen 2,500,000 16.67%
7900 Four Seasons Drive
Las Vegas, NV 89129
Common Total Ownership over 5% 7,500,000 50.00%
and Officers and
Directors
</TABLE>
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
PERSONS
The members of the Board of Directors of the Company serve until
the next annual meeting of the stockholders, or until their
successors have been elected. The officers serve at the pleasure
of the Board of Directors.
There are no agreements for any officer or director to resign at
the request of any other person, and none of the officers or
directors named below are acting on behalf of, or at the
direction of, any other person.
The Company's officers and directors will devote their time to
the business on an "as-needed" basis, which is expected to
require 5-10 hours per month.
Information as to the directors and executive officers of the
Company is as follows:
<TABLE>
<S> <C> <C>
Name/Address Age Position
Bobby Combs 62 President/Direc
6669 Five Pennnies tor
Circle
Las Vegas, NV 89120
Charles F. Richards, 56 Secretary/Director
Jr.
1903 Orange Blvd.
Palm Harbor, FL 34683
David L. Christensen 51 Treasurer/Director
7900 Four Seasons Drive
Las Vegas, NV 89129
</TABLE>
Bobby Combs; President
Mr. Bobby Combs has been a Director and President of the Company
since inception, October 16, 1995.
Since October 1995, Mr. Combs has been a Director and Officer of
Silvercrest International, Inc. Since March 1994, Mr. Combs has
been president and majority stockholder of Par One Mortgage, Las
Vegas, Nevada. From January 1994, through February 1994, he was a
loan officer for Summit Capital, Las Vegas, Nevada. Since 1989,
Mr. Combs has been an Officer and Director of Bobby Combs &
Associates. From September 1993 through December 1993, Mr. Combs
was a loan officer for Vegas Valley Mortgage. From March 1993
through August 1993, he was employed at Royal Kinfield Country
Club, Las Vegas, Nevada. From September 1990 until December
1991, Mr. Combs was engaged in building and remodeling homes for
Rauhut Construction, Inc., Las Vegas, Nevada, of which he was a
partner. From March 1989 through August 1990, he was engaged as
a salesman in the ornamental iron industry.
Charles F. Richards, Jr.; Secretary
Mr. Charles F. Richards, Jr. has been a Director and Secretary of
the Company since inception, October 16, 1995.
From March 1992 to March 1997, he was owner of and served as a
Loan Officer for Equity First Associates, Inc. (formerly Security
Mortgage), Las Vegas, Nevada, where he sold and processed
residential mortgage loans for sale to FNMA/FHLMC, and VA. He
was also accountable for loan packages from initial application
to funding as well as being in charge of hiring, firing, and
managing of loan officers and support staff as owner/manager.
From September 1989 to March 1992, he was a Loan Officer and
Owner MMI Home Loans, Lancaster, CA, where he sold and processed
residential mortgage loans for sale to FNMA/FHLMC, and VA. He
was also accountable for loan packages from initial application
to funding as well as being in charge of hiring, firing, and
managing of loan officers and support staff as owner/manager.
From July, 1988 to September 1989, He was a loan officer for
Public Home Loans, Sherman Oaks, CA, where he created and
maintained an FHA Title 1 loan division and Sold and Processed
loans for sale to FNMA.
From November 1971 to June 1988, he was employed as a Tax
Auditor, Collector, and Supervisor for Texas Employment
Commission, Austin, TX, where he audited and collected taxes for
unemployment insurance, testified in court for the State of Texas
as an expert witness, served as supervisor in charge of
Enforcement Actions Unit for six years, and managed the daily
activities of a seven person support staff for seven years.
From June 1971 to November 1971, he was employed as an Assistant
Manager for Wyatt Cafeteria, Dallas, TX.
Education highlights include a B.B.A. degree in Industrial
Management from Texas Tech University (1971), a California Real
Estate Broker License (1990), being an electronics technician in
the United States Air Force from 1961 to 1965, and Attending
Premier Schools for Real Estate, Culver City, California (June
1990).
David L. Christensen; Treasurer
Mr. David L. Christensen has been a Director and Treasurer of the
Company since inception, October 16, 1995.
Since 1992, he has been a Senior Loan Officer for Citibank
(Nevada) N.A. where he is the Citibank Western Region Top
Producer.
From 1989 to 1992, he was loan officer for Security Mortgage,
Inc.
From 1980 to 1989, he was a Vice President of American Farms,
Inc. where he worked with international and U.S. Government
financial institutions on the implementation and development of
projects. He also developed and managed projects in third world
countries.
From 1977 to 1980, he served as Vice President of Finance and
Administration of International Development Corporation, Inc.
where he implemented and directed all financial affairs,
interfaced with domestic and international institutions regarding
project development in Middle East Nations, and administrated the
coordination of all corporate department heads.
From 1974 to 1977, he served as the manager for the loan
department at First Security Bank of Idaho where he originated
and serviced commercial and mortgage loans, including
conventional, FHA, and VA loan types. Additionally, he supervised
department activities.
He holds a Bachelor of Science degree in Business Administration
with a concentration in finance as well as having attended
numerous management and financial seminars through ABI, AMA,
Advanced Management Research International, and universities.
Blank Check Experience
In addition to the experience described above, Mr. Bobby Combs is
or has been an officer and/or director of a number of blank check
companies.
B-N-B Enterprises, Inc. - Treasurer from November 1994
through May 1997. He resigned as part of a merger
agreement with Allwest Systems International, Inc. Mr.
Combs received no compensation as part of the merger,
other than shares in the surviving entity, which were
granted in the same amount as all other shareholders
received.
Polyspherics, Inc. - Officer and Director since September
1996.
M-80's, Inc. - Officer and Director since May 1998.
Professional Mining Consultants, Inc. - Officer and Director
since 1999.
Nevada Stock Transfer Corporation - Officer and Director
since April 1987. However, this company is no longer in
existence.
In addition to the experience described above, Mr. Charles F.
Richards, Jr. is or has been an officer and/or director of a
number of blank check companies.
Caye Chapel, Inc. - Officer and Director from September 1995
through October 1998. He resigned as part of a merger
agreement in October 1998. Mr. Richards received no
compensation as part of the merger, other than shares in
the surviving entity, which were granted in the same
amount as all other shareholders received.
Charter Group International, Inc. - Officer and Director
from November 1991 through August 1997. He resigned as
part of a merger agreement with Signature Brands, Inc.
Mr. Richards received no compensation as part of the
merger, other than shares in the surviving entity, which
were granted in the same amount as all other shareholders
received.
Travel Masters - Treasurer from March 1995 through May 1999.
He resigned as part of a merger agreement with Progress
Watch Corp. Mr. Richards received no compensation as part
of the merger, other than shares in the surviving entity,
which were granted in the same amount as all other
shareholders received.
Cherokee Leather, Inc. (name changed to Popstar
Communications, Inc.) - Officer and Director since 1995.
Sporlox Corporation - President since May 1998.
Quicksilver Investments, Inc. - Officer and Director since
January 1994.
In addition to the experience described above, Mr. David L.
Christensen is or has been an officer and/or director of a number
of blank check companies.
Charter Group International, Inc. - Officer and Director
from November 1990 through August 1997. He resigned as
part of a merger agreement with Signature Brands, Inc.
Mr. Christensen received no compensation as part of the
merger, other than shares in the surviving entity, which
were granted in the same amount as all other shareholders
received.
Cherokee Leather, Inc. (name changed to Popstar
Communications, Inc.) - President since 1995.
Las Vegas Sports and Celebrity Hall of Fame, Inc. - Officer
and Director since February 1991.
Relational Concepts, Inc. - President since April 1998.
There is no family relationship between any of the officers and
directors of the Company. The Company's Board of Directors has
not established any committees.
Conflicts of Interest
Insofar as the officers and directors are engaged in other
business activities, management anticipates it will devote only a
minor amount of time to the Company's affairs. The officers and
directors of the Company may in the future become shareholders,
officers or directors of other companies which may be formed for
the purpose of engaging in business activities similar to those
conducted by the Company. The Company does not currently have a
right of first refusal pertaining to opportunities that come to
management's attention insofar as such opportunities may relate
to the Company's proposed business operations.
The officers and directors are, so long as they are officers or
directors of the Company, subject to the restriction that all
opportunities contemplated by the Company's plan of operation
which come to their attention, either in the performance of their
duties or in any other manner, will be considered opportunities
of, and be made available to the Company and the companies that
they are affiliated with on an equal basis. A breach of this
requirement will be a breach of the fiduciary duties of the
officer or director. Subject to the next paragraph, if a
situation arises in which more than one company desires to merge
with or acquire that target company and the principals of the
proposed target company have no preference as to which company
will merge or acquire such target company, the company of which
the President first became an officer and director will be
entitled to proceed with the transaction. Except as set forth
above, the Company has not adopted any other conflict of interest
policy with respect to such transactions.
Investment Company Act of 1940
Although the Company will be subject to regulation under the
Securities Act of 1933 and the Securities Exchange Act of 1934,
management believes the Company will not be subject to regulation
under the Investment Company Act of 1940 insofar as the Company
will not be engaged in the business of investing or trading in
securities. In the event the Company engages in business
combinations which result in the Company holding passive
investment interests in a number of entities, the Company could
be subject to regulation under the Investment Company Act of
1940. In such event, the Company would be required to register as
an investment company and could be expected to incur significant
registration and compliance costs. The Company has obtained no
formal determination from the Securities and Exchange Commission
as to the status of the Company under the Investment Company Act
of 1940 and, consequently, any violation of such Act would
subject the Company to material adverse consequences.
ITEM 6. EXECUTIVE COMPENSATION
None of the Company's officers and/or directors receive any
compensation for their respective services rendered to the
Company, nor have they received such compensation in the past.
They have agreed to act without compensation until authorized by
the Board of Directors, which is not expected to occur until the
Registrant has generated revenues from operations after
consummation of a merger or acquisition. As of the date of this
registration statement, the Company has no funds available to pay
directors. Further, none of the directors are accruing any
compensation pursuant to any agreement with the Company.
It is possible that, after the Company successfully consummates a
merger or acquisition with an unaffiliated entity, that entity
may desire to employ or retain one or more members of the
Company's management for the purposes of providing services to
the surviving entity, or otherwise provide other compensation to
such persons. However, the Company has adopted a policy whereby
the offer of any post-transaction remuneration to members of
management will not be a consideration in the Company's decision
to undertake any proposed transaction. Each member of management
has agreed to disclose to the Company's Board of Directors any
discussions concerning possible compensation to be paid to them
by any entity which proposes to undertake a transaction with the
Company and further, to abstain from voting on such transaction.
Therefore, as a practical matter, if each member of the Company's
Board of Directors is offered compensation in any form from any
prospective merger or acquisition candidate, the proposed
transaction will not be approved by the Company's Board of
Directors as a result of the inability of the Board to
affirmatively approve such a transaction.
It is possible that persons associated with management may refer
a prospective merger or acquisition candidate to the Company. In
the event the Company consummates a transaction with any entity
referred by associates of management, it is possible that such an
associate will be compensated for their referral in the form of a
finder's fee. It is anticipated that this fee will be either in
the form of restricted common stock issued by the Company as part
of the terms of the proposed transaction, or will be in the form
of cash consideration. However, if such compensation is in the
form of cash, such payment will be tendered by the acquisition or
merger candidate, because the Company has insufficient cash
available. The amount of such finder's fee cannot be determined
as of the date of this registration statement, but is expected to
be comparable to consideration normally paid in like
transactions. No member of management of the Company will receive
any finders fee, either directly or indirectly, as a result of
their respective efforts to implement the Company's business plan
outlined herein. Persons "associated" with management is meant to
refer to persons with whom management may have had other business
dealings, but who are not affiliated with or relatives of
management.
No retirement, pension, profit sharing, stock option or insurance
programs or other similar programs have been adopted by the
Registrant for the benefit of its employees.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Board of Directors has passed a resolution which contains a
policy that the Company will not seek an acquisition or merger
with any entity in which any of the Company's Officers,
Directors, principal shareholders or their affiliates or
associates serve as officer or director or hold any ownership
interest. Management is not aware of any circumstances under
which this policy may be changed through their own initiative.
The proposed business activities described herein classify the
Company as a "blank check" company. Many states have enacted
statutes, rules and regulations limiting the sale of securities
of "blank check" companies in their respective jurisdictions.
Management does not intend to undertake any efforts to cause a
market to develop in the Company's securities until such time as
the Company has successfully implemented its business plan
described herein.
ITEM 8. LEGAL PROCEEDINGS
The Company is not a party to any material pending legal
proceedings and, to the best of its knowledge, no such action by
or against the Company has been threatened.
ITEM 9. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS.
The Company's common stock is quoted on the over-the-counter
market in the United States under the symbol BHAS. Management has
not undertaken any discussions, preliminary or otherwise, with
any prospective market maker concerning the participation of such
market maker in the after-market for the Company's securities and
management does not intend to initiate any such discussions until
such time as the Company has consummated a merger or acquisition.
There is no assurance that a trading market will ever develop or,
if such a market does develop, that it will continue.
After a merger or acquisition has been completed, any or all of
the Company's officers and directors will most likely be the
persons to contact prospective market makers. It is also possible
that persons associated with the entity that merges with or is
acquired by the Company will contact prospective market makers.
The Company does not intend to use consultants to contact market
makers.
Market Price
The Registrant's Common Stock has not traded recently, therefore
no quotes are available.
Effective August 11, 1993, the Securities and Exchange Commission
adopted Rule 15g-9, which established the definition of a "penny
stock," for purposes relevant to the Company, as any equity
security that has a market price of less than $5.00 per share or
with an exercise price of less than $5.00 per share, subject to
certain exceptions. For any transaction involving a penny stock,
unless exempt, the rules require: (i) that a broker or dealer
approve a person's account for transactions in penny stocks; and
(ii) the broker or dealer receive from the investor a written
agreement to the transaction, setting forth the identity and
quantity of the penny stock to be purchased. In order to approve
a person's account for transactions in penny stocks, the broker
or dealer must (i) obtain financial information and investment
experience and objectives of the person; and (ii) make a
reasonable determination that the transactions in penny stocks
are suitable for that person and that person has sufficient
knowledge and experience in financial matters to be capable of
evaluating the risks of transactions in penny stocks. The broker
or dealer must also deliver, prior to any transaction in a penny
stock, a disclosure schedule prepared by the Commission relating
to the penny stock market, which, in highlight form, (i) sets
forth the basis on which the broker or dealer made the
suitability determination; and (ii) that the broker or dealer
received a signed, written agreement from the investor prior to
the transaction. Disclosure also has to be made about the risks
of investing in penny stocks in both public offerings and in
secondary trading, and about commissions payable to both the
broker-dealer and the registered representative, current
quotations for the securities and the rights and remedies
available to an investor in cases of fraud in penny stock
transactions. Finally, monthly statements have to be sent
disclosing recent price information for the penny stock held in
the account and information on the limited market in penny
stocks.
The National Association of Securities Dealers, Inc. (the
"NASD"), which administers NASDAQ, has recently made changes in
the criteria for initial listing on the NASDAQ Small Cap market
and for continued listing. For initial listing, a company must
have net tangible assets of $4 million, market capitalization of
$50 million or net income of $750,000 in the most recently
completed fiscal year or in two of the last three fiscal years.
For initial listing, the common stock must also have a minimum
bid price of $4 per share. In order to continue to be included on
NASDAQ, a company must maintain $2,000,000 in net tangible assets
and a $1,000,000 market value of its publicly-traded securities.
In addition, continued inclusion requires two market-makers and a
minimum bid price of $1.00 per share.
Management intends to strongly consider undertaking a transaction
with any merger or acquisition candidate which will allow the
Company's securities to be traded without the aforesaid
limitations. However, there can be no assurances that, upon a
successful merger or acquisition, the Company will qualify its
securities for listing on NASDAQ or some other national exchange,
or be able to maintain the maintenance criteria necessary to
insure continued listing. The failure of the Company to qualify
its securities or to meet the relevant maintenance criteria after
such qualification in the future may result in the discontinuance
of the inclusion of the Company's securities on a national
exchange. In such events, trading, if any, in the Company's
securities may then continue in the non-NASDAQ over-the-counter
market. As a result, a shareholder may find it more difficult to
dispose of, or to obtain accurate quotations as to the market
value of, the Company's securities.
Holders
There are 29 holders of the Company's Common Stock. On October
16, 1995, the Company issued 6,000,000 of its $0.001 par value
Common Stock for $6,000 in cash. On April 29, 1999, the stock
underwent a 2.5:1 forward stock split, resulting in a total of
15,000,000 shares issued and outstanding. All of the issued and
outstanding shares of the Company's Common Stock were issued in
accordance with the exemption from registration afforded by
Section 4(2) of the Securities Act of 1933.
Dividends
The Registrant has not paid any dividends to date, and has no
plans to do so in the immediate future.
ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES.
With respect to the sales made, the Registrant relied on Section
4(2) of the Securities Act of 1933, as amended. No advertising or
general solicitation was employed in offering the shares. The
securities were offered for investment only and not for the
purpose of resale or distribution, and the transfer thereof was
appropriately restricted.
Of the 15,000,000 shares presently outstanding, a total of
7,500,000 are restricted and may not be sold other than pursuant
to registration statement being in effect, pursuant to an
exemption from registration, or in accordance with Rule 144. In
general, under Rule 144, a person (or persons whose shares are
aggregated) who has satisfied a one year holding period, under
certain circumstances, may sell within any three-month period a
number of shares which does not exceed the greater of one percent
of the then outstanding Common Stock or the average weekly
trading volume during the four calendar weeks prior to such sale.
Rule 144 also permits, under certain circumstances, the sale of
shares without any quantity limitation by a person who has
satisfied a two-year holding period and who is not, and has not
been for the preceding three months, an affiliate of the Company.
ITEM 11. DESCRIPTION OF SECURITIES.
Common Stock
The Company's Articles of Incorporation authorizes the issuance
of 50,000,000 shares of Common Stock, $0.001 par value per share,
of which 15,000,000 are issued and outstanding. The shares are
non-assessable, without pre-emptive rights, and do not carry
cumulative voting rights. Holders of common shares are entitled
to one vote for each share on all matters to be voted on by the
stockholders. The shares are fully paid, non-assessable, without
pre-emptive rights, and do not carry cumulative voting rights.
Holders of common shares are entitled to share ratably in
dividends, if any, as may be declared by the Company from time-to-
time, from funds legally available. In the event of a
liquidation, dissolution, or winding up of the Company, the
holders of shares of common stock are entitled to share on a pro-
rata basis all assets remaining after payment in full of all
liabilities.
Management is not aware of any circumstances in which additional
shares of any class or series of the Company's stock would be
issued to management or promoters, or affiliates or associates of
either.
ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company and its affiliates may not be liable to its
shareholders for errors in judgment or other acts or omissions
not amounting to intentional misconduct, fraud, or a knowing
violation of the law, since provisions have been made in the
Articles of incorporation and By-laws limiting such liability.
The Articles of Incorporation and By-laws also provide for
indemnification of the officers and directors of the Company in
most cases for any liability suffered by them or arising from
their activities as officers and directors of the Company if they
were not engaged in intentional misconduct, fraud, or a knowing
violation of the law. Therefore, purchasers of these securities
may have a more limited right of action than they would have
except for this limitation in the Articles of Incorporation and
By-laws.
The officers and directors of the Company are accountable to the
Company as fiduciaries, which means such officers and directors
are required to exercise good faith and integrity in handling the
Company's affairs. A shareholder may be able to institute legal
action on behalf of himself and all others similarly stated
shareholders to recover damages where the Company has failed or
refused to observe the law.
Shareholders may, subject to applicable rules of civil procedure,
be able to bring a class action or derivative suit to enforce
their rights, including rights under certain federal and state
securities laws and regulations. Shareholders who have suffered
losses in connection with the purchase or sale of their interest
in the Company in connection with such sale or purchase,
including the misapplication by any such officer or director of
the proceeds from the sale of these securities, may be able to
recover such losses from the Company.
ITEM 13. FINANCIAL STATEMENTS.
The financial statements and supplemental data required by this
Item 13 follow the index of financial statements appearing at
Item 15 of this Form 10-SB.
ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
The Registrant has not changed accountants since its formation,
and Management has had no disagreements with the findings of its
accountants.
ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS.
FINANCIAL STATEMENTS
Report of Independent Auditors, Barry L. Friedman,
P.C., August July 6, 1999.
Balance Sheet as of June 30, 1999 and year Ended
December 31, 1998.
Statement of Operation for the three month and six
month periods ending June 30, 1999, and June 30,
1998, and the two years ended December 31, 1998 and
December 31, 1997, and for the period October 10,
1995 (inception) to June 30, 1999.
Statement of Stockholders' Equity
Statement of Cash Flows for the three month and six
month periods ending June 30, 1999, and June 30,
1998, and the two years ended December 31, 1998 and
December 31, 1997, and for the period October 10,
1995 (inception) to June 30, 1999.
Notes to Financial Statements
INDEPENDENT AUDITORS' REPORT
Board of Directors August 6, 1999
Bach-Hauser, Inc.
Las Vegas, Nevada
I have audited the accompanying Balance Sheets of Bach-Hauser,
Inc. (A Development Stage Company), as of June 30, 1999, and
December 31, 1998, and the related statements of stockholders'
equity for June 30, 1999, and December 31, 1998, and statements
of operation and cash flows for the three months ending June 30,
1999, and June 30, 1998, for the six months ended June 30, 1999,
and June 30, 1998, and the two years ended December 31, 1998, and
December 31, 1997, and the period October 10, 1995 (inception),
to June 30, 1999. These financial statements are the
responsibility of the Company's management. My responsibility is
to express an opinion on these financial statements based on my
audit.
I conducted my audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation. I believe that my
audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Bach-
Hauser, Inc. (A Development Stage Company), as of June 30, 1999,
and December 31, 1998, and the related statements of
stockholders' equity for June 30, 1999, and December 31, 1998,
and statements of operation and cash flows for the three months
ending June 30, 1999, and June 30, 1998, for the six months ended
June 30, 1999, and June 30, 1998, and the two years ended
December 31, 1998, and December 31, 1997, and the period October
10, 1995 (inception), to June 30, 1999, in conformity with
generally accepted accounting principles.
The accompanying financial statements have been prepared assuming
the Company will continue as a going concern. As discussed in
Note #5 to the financial statements, the Company has suffered
recurring losses from operations and has no established source of
revenue. This raises substantial doubt about its ability to
continue as a going concern. Management's plan in regard to these
matters is described in Note #5. These financial statements do
not include any adjustments that might result from the outcome of
this uncertainty.
/s/ Barry L. Friedman
Barry L. Friedman
Certified Public Accountant
BACH-HAUSER, INC.
(A Development Stage Company)
BALANCE SHEET
<TABLE>
<S> <C> <C>
6 Mos. Ending Year Ended Dec.
June 30, 1999 31, 1998
ASSETS
CURRENT ASSETS: 0 0
TOTAL CURRENT ASSETS 0 0
OTHER ASSETS; 54 78
TOTAL OTHER ASSETS 54 78
TOTAL ASSETS 54 78
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES;
Officers Advances $1,075 $1,075
TOTAL CURRENT LIABILITIES $1,075 $1,075
STOCKHOLDERS' EQUITY;
Common stock, $0.001 par value, $6,000
authorized 25,000,000 shares
issued and outstanding
December 31, 1998 - 6,000,000
shares
June 30, 1999 - 6,000,000 shares $6,000
Additional paid-in Capital 0 0
Accumulated loss -7,021 -6,997
TOTAL STOCKHOLDERS' EQUITY $ -1,021 $ -997
TOTAL LIABILITIES AND 54 78
STOCKHOLDERS' EQUITY
</TABLE>
BACH-HAUSER, INC.
(A Development Stage Company)
STATEMENT OF OPERATION
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
3 Mos. 3 Mos. Ending 6 Mos. Ending 6 Mos. Ending Year Ended Year Ended Oct. 10, 1995
Ending June 30, 1998 June, 30, 1999 June 30, 1998 Dec. 31, 1998 Dec. 31, 1997 (Inception) to
June June 30, 1999
30,
1999
INCOME:
Revenue 0 0 0 0 0 0 0
EXPENSES:
General, Selling and 0 $725 0 $1,075 $1,075 0 $6,840
Administrative
Amortization 12 12 24 24 47 47 181
Total Expenses $12 $737 $24 $1,099 $1,122 $47 $7,021
Net Profit/Loss(-) $ -12 $ -737 $-24 $ -1,099 $ -1,122 $ -47 $ -7,021
Net Profit/Loss NIL $ -.0001 NIL $ -.0002 $ -.0002 NIL $ -.0012
(-) Per weighted Share
(Note 2)
Weighted average 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000 6,000,000
Number of common
Shares outstanding
</TABLE>
See accompanying notes to financial statements & audit report
BACH-HAUSER, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
<TABLE>
<S> <C> <C> <C> <C>
Common Shares Stock Amount Additional paid- Accumulated
in Capital Deficit
Balance, 6,000,000 $6,000 $0 $ -5,875
December 31, 1997
Net loss, Year -1,122
Ended
December 31, 1998
Balance, 6,000,000 $6,000 $0 $ -6,997
December 31, 1998
Net Loss January 1, -24
1999, to June 30,
1999
Balance, 6,000,000 $6,000 $0 $ -7,021
June 30, 1999
</TABLE>
See accompanying notes to financial statements & audit report.
BACH-HAUSER, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
3 Mos. 3 Mos. Ended 6 Mos. Ended 6 Mos. Ended Year Ended Year Ended Oct. 10, 1995
June 30, June 30, 1998 June 30, 1999 June 30, 1998 Dec. 31, 1998 Dec. 31, 1997 (Inception) to
1999 June 30, 1999
Cash Flows from
Operating
Activities:
Net Loss $ -12 $ -737 $ -24 $ -1,099 $ -1,122 $ -47 $ -7,021
Adjustment to
Reconcile net loss
to cash provided by
operating
activities:
Amortization +12 +12 +24 +24 +47 +47 +181
Changes in Assets and
Liabilities:
Organization Costs 0 0 0 0 0 0 -235
Increase in current
Liabilities:
Officers Advances 0 +725 0 -1,075 -1,075 0 +1,075
Cash Flows from 0 0 0 0 0 0 0
Investing Activities
Cash Flows from
Financing
Activities:
Issuance of common 0 0 0 0 0 0 +6,000
stock
Net increase 0 0 0 0 0 0 0
(decrease) in cash
Cash, Beginning of 0 0 0 0 0 0 0
period
Cash, end of period 0 0 0 0 0 0 0
</TABLE>
See accompanying notes to financial statements & audit report
BACH-HAUSER, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1999, and December 31, 1998
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized October 10, 1995, under the laws of the
State of Nevada as Bach-Hauser, Inc. The Company currently has no
operations and in accordance with SFAS #7, is considered a
development company.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Method
The Company records income and expenses on the accrual method.
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 revenue and expenses during the reporting
period. Actual results could differ from those estimates.
Cash and equivalents
The Company maintains a cash balance in a non-interest-bearing
bank that currently does not exceed federally insured limits. For
the purpose of the statements of cash flows, all highly liquid
investments with the maturity of three months or less are
considered to be cash equivalents. There are no cash equivalents
as of June 30, 1999.
Income Taxes
Income taxes are provided for using the liability method of
accounting in accordance with Statement of Financial Accounting
Standards No. 109 (SFAS #109) "Accounting for Income Taxes". A
deferred tax asset or liability is recorded for all temporary
difference between financial and tax reporting. Deferred tax
expense (benefit) results from the net change during the year of
deferred tax assets and liabilities.
Organization Costs
Costs incurred to organize the Company are being amortized on a
straight-line basis over a sixty-month period.
Loss Per Share
Net loss per share is provided in accordance with Statement of
Financial Accounting Standards No. 128 (SFAS #128) "Earnings Per
Share". Basic loss per share is computed by dividing losses
available to common stockholders by the weighted average number
of common shares outstanding during the period. Diluted loss per
share reflects per share amounts that would have resulted if
dilative common stock equivalents had been converted to common
stock. As of June 30, 1999, the Company had no dilative common
stock equivalents such as stock options.
Year End
The Company has selected December 31st as its year-end.
Year 2000 Disclosure
The year 2000 issue is the result of computer programs being
written using two digits rather than four to define the
applicable year. Computer programs that have time sensitive
software may recognize a date using "00" as the year 1900 rather
than the year 2000. This could result in a system failure or
miscalculations causing disruption of normal business activities.
Since the Company currently has no operating business and does
not use any computers, and since it has no customers, suppliers
or other constituents, there are no material Year 2000 concerns.
NOTE 3 - INCOME TAXES
There is no provision for income taxes for the period ended June
30, 1999, due to the net loss and no state income tax in Nevada,
the state of the Company's domicile and operations. The Company's
total deferred tax asset as of December 31, 1998 is as follows:
Net operation loss carry forward $6,997
Valuation allowance $6,997
Net deferred tax asset $ 0
The federal net operation loss carry forward will expire in 2015
and 2018.
This carry forward may be limited upon the consummation of a
business combination under IRC Section 381.
NOTE 4 - STOCKHOLDERS' EQUITY
Common Stock
The authorized common stock of the corporation consists of
50,000,000 shares with a par value of $0.001 per share.
Preferred Stock
Bach-Hauser, Inc. has no preferred stock.
On October 16, 1995, the Company issued 6,000,000 shares of its
$0.001 par value common stock in consideration of $6,000.00 in
cash.
NOTE 5 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern
which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. However, the
Company does not have significant cash or other material assets,
nor does it have an established source of revenues sufficient to
cover its operating costs and to allow it to continue as a going
concern. It is the intent of the Company to seek a merger with an
existing, operating company. Until that time, the
stockholders/officers and or directors have committed to
advancing the operating costs of the Company interest free.
NOTE 6 - RELATED PARTY TRANSACTIONS
The Company neither owns nor leases any real or personal
property. An officer of the corporation provides office services
without charge. Such costs are immaterial to the financial
statements and accordingly, have not been reflected therein. The
officers and directors of the Company are involved in other
business activities and may, in the future, become involved in
other business opportunities. If a specific business
opportunity becomes available, such persons may face a conflict
in selecting between the Company and their other business
interests. The Company has not formulated a policy for the
resolution of such conflicts.
NOTE 7 - WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any
additional share of common stock.
EXHIBITS
3.1 Articles of Incorporation
3.2 By-Laws
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the Registrant has duly caused this
registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
Bach-Hauser, Inc.
By:/s/Bobby Combs
Bobby Combs, President
ARTICLES OF INCORPORATION
of
Bach-Hauser, Inc.
Know all men by these present;
That the undersigned, have this day voluntarily associated
ourselves together for the purpose of forming a corporation under
and pursuant to the provisions of Nevada Revised Statutes 78.010.
to Nevada Revised Statutes 78.090 inclusive, as amended, and
certify that;
1. The name of this corporation is:
Bach-Hauser, Inc.
2. Offices for the transaction of any business of the
Corporation, and where meetings of the Board of Directors and of
Stockholders may be held, may be established and maintained in
any part of the State of Nevada, or in any other state,
territory, or possession of the United States.
3. The nature of the business is to engage in any lawful
activity.
4. The Capital Stock shall consist of 50,000,000 shares of
common stock, $0.001 par value.
5. The members of the governing board of the corporation shall
be styled directors, of which there shall be no less than 1. The
Directors of this corporation need not be stockholders. The first
Board of Directors is: Charles T. Ward, whose address is 4025
Wake Forest Drive, Las Vegas, NV 89129.
6. This corporation shall have perpetual existence.
7. The name and address of each of the incorporators signing
these Articles of Incorporation are as follows: Charles T. Ward,
whose address is 4025 Wake Forest Drive, Las Vegas, NV 89129.
8. This Corporation shall have a president, a secretary, a
treasurer, and a resident agent, to be chosen by the Board of
Directors, any person may hold two or more offices.
9. The resident agent of this Corporation shall be Charles T.
Ward, whose address is 4025 Wake Forest Drive, Las Vegas, NV
89129.
10. The Capital Stock of the corporation, after the fixed
consideration thereof has been paid or performed, shall not be
subject to assessment, and the individual liable for the debts
and liabilities of the Corporation, and the Articles of
Incorporation shall never be amended as the aforesaid provisions.
11. No director or officer of the corporation shall be
personally liable to the corporation of any of its stockholders
for breach of fiduciary duty as a director or officer involving
any act or omission of any such director or officer provided,
however, that the foregoing provision shall not eliminate or
limit the liability of a director or officer for acts or
omissions which involve intentional misconduct, fraud, or a
knowing violation of law, or the payment of dividends in
violation of Section 78.300 of the Nevada Revised Statutes. Any
repeal or modification of this Article of the Stockholders of the
Corporation shall be prospective only, and shall not adversely
affect any limitation on the personal liability of a director or
officer of the Corporation for acts or omissions prior to such
repeal or modification.
I, the undersigned, being the incorporator herein above 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 within stated are true, and accordingly have hereunto
set my hand this 4th day of October, 1995.
/s/ Charles T. Ward
Charles T. Ward
Bylaws
of
Bach-Hauser, Inc.
(the "Corporation")
Article I
Office
The Board of Directors shall designate and the Corporation shall
maintain a principal office. The location of the principal office
may be changed by the Board of Directors. The Corporation also
may have offices in such other places as the Board may from time
to time designate. The location of the initial principal office
of the Corporation shall be designated by resolution.
Article II
Shareholders Meetings
1. Annual Meetings
The annual meeting of the shareholders of the Corporation
shall be held at such place within or without the State of
Nevada as shall be set forth in compliance with these Bylaws.
The meeting shall be held on the Third Monday of October of
each year. If such day is a legal holiday, the meeting shall
be on the next business day. This meeting shall be for the
election of Directors and for the transaction of such other
business as may properly come before it.
2. Special Meetings
Special meetings of shareholders, other than those regulated
by statute, may be called by the President upon written
request of the holders of 50% or more of the outstanding
shares entitled to vote at such special meeting. Written
notice of such meeting stating the place, the date and hour of
the meeting, the purpose or purposes for which it is called,
and the name of the person by whom or at whose direction the
meeting is called shall be given.
3. Notice of Shareholders Meeting
The Secretary shall give written notice stating the place,
day, and hour of the meeting, and in the case of a special
meeting, the purpose or purposes for which the meeting is
called, which shall be delivered not less than ten or more
than fifty days before the date of the meeting, either
personally or by mail 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 their address as it
appears on the books of the Corporation, with postage thereon
prepaid. Attendance at the meeting shall constitute a waiver
of notice thereof.
4. Place of Meeting
The Board of Directors may designate any place, wither within
or without the State of Nevada, 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 Nevada, as the
place for the holding of such meeting. If no designation is
made, or if a special meeting is otherwise called, the place
of meeting shall be the principal office of the Corporation.
5. Record Date
The Board of Directors may fix a date not less than ten nor
more than fifty days prior to any meeting as the record date
for the purpose of determining shareholders entitled to notice
of and to vote at such meetings of the shareholders. The
transfer books may be closed by the Board of Directors for a
stated period not to exceed fifty day for the purpose of
determining shareholders entitled to receive payment of and
dividend, or in order to make a determination of shareholders
for any other purpose.
6. 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 a
meeting resumed after any such adjournment 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.
7. Voting
A shareholder of outstanding shares, entitled to vote at a
meeting, may vote at such meeting in person or by proxy.
Except as may otherwise be provided in the currently filed
Articles of Incorporation, every shareholder shall be entitled
to one vote for each share standing their name on the record
of shareholders. Except as herein or in the currently filed
Articles of Incorporation otherwise provided, all corporate
action shall be determined by a majority of the votes cast at
a meeting of shareholders by the holders of shares entitled to
vote thereon.
8. Proxies
At all meetings of shareholders, a shareholder may vote in
person or by proxy executed in writing by the shareholder or
by their 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
months from the date of its execution.
9. Informal Action by Shareholders
Any action required to 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
a majority of the shareholders entitled to vote with respect
to the subject matter therof.
Article III
Board of Directors
1. General Powers
The business and affairs of the Corporation shall be managed
by its Board of Directors. The Board of Directors may adopt
such rules and regulations for the conduct of their meetings
and the management of the Corporation as they appropriate
under the circumstances. The Board shall have authority to
authorize changes in the Corporation's capital structure.
2. Number, Tenure and Qualification
The number of Directors of the Corporation shall be a number
between one and five, as the Directors may by resolution
determine from time to time. Each of the Directors shall hold
office until the next annual meeting of the shareholders and
until their successor shall have been elected and qualified.
3. Regular Meetings
A regular meeting of the Board of Directors shall be held
without other notice than by this Bylaw, 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 this resolution.
4. Special Meetings
Special meetings of the Board of Directors may be called by
order of the Chairman of the Board or the President. The
Secretary shall give notice of the time, place and purpose or
purposes of each special meeting by mailing the same at least
two days before the meeting or by telephone, telegraphing or
telecopying the same at least one day before the meeting to
each Director. Meeting of the Board of Directors may be held
by telephone conference call.
5. Quorum
A majority of the members of the Board of Directors shall
constitute a quorum for the transaction of business, but less
than a quorum may adjourn any meeting from time to time until
a quorum shall be present, whereupon the meeting may be held,
as adjourned, without further notice. At any meeting at which
every Director shall be present, even though without any
formal notice any business may be transacted.
6. Manner of Acting
At all meetings of the Board of Directors, each Director shall
have one vote. The act of a majority of Directors present at
a meeting shall be the act of the full Board of Directors,
provided that a quorum is present.
7. Vacancies
A vacancy in the Board of Directors shall be deemed to exist
in the case of death, resignation, or removal of any Director,
or if the authorized number of Directors is increased, or if
the shareholders fail, at any meeting of the shareholders, at
which any Director is to be elected, to elect the full
authorized number of Directors to be elected at that meeting.
8. Removals
Directors may be removed, at any time, by a vote of the
shareholders holding a majority of the shares outstanding and
entitled to vote. Such vacancy shall be filled by the
Directors then in office, though less than a quorum, to hold
office until the next annual meeting or until their successor
is duly elected and qualified, except that any directorship to
be filled by election by the shareholders at the meeting at
which the Director is removed. No reduction of the authorized
number of Directors shall have the effect of removing any
Director prior to the expiration of their term of office.
9. Resignation
A director may resign at any time by delivering written
notification thereof to the President or Secretary of the
Corporation. A resignation shall become effective upon its
acceptance by the Board of Directors; provided, however, that
if the Board of Directors has not acted thereon within ten
days from the date of its delivery, the resignation shall be
deemed accepted.
10. 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(s)
taken unless their dissent shall be placed in the minutes of
the meeting or unless he or she shall file their 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.
11. Compensation
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 or a stated salary as Director. No
such payment shall preclude any Director from serving the
Corporation in any other capacity and receiving compensation
therefor.
12. Emergency Power
When, due to a natural disaster or death, a majority of the
Directors are incapacitated or otherwise unable to attend the
meetings and function as Directors, the remaining members of
the Board of Directors shall have all the powers necessary to
function as a complete Board, and for the purpose of doing
business and filling vacancies shall constitute a quorum,
until such time as all Directors can attend or vacancies can
be filled pursuant to the Bylaws.
13. Chairman
The Board of Directors may elect from its own number a
Chairman of the Board, who shall preside at all meetings of
the Board of Directors, and shall perform such other duties as
may be prescribed from time to time by the Board of Directors.
The Chairman may by appointment fill any vacancies on the
Board of Directors.
Article IV
Officers
1. Number
The officers of the Corporation shall be a President, one or
more Vice Presidents, a Secretary, and a Treasurer, each of
whom shall be elected by a majority of 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. In its discretion, the Board of Directors may
leave unfilled for any such period as it may determine any
office except those of President and Secretary. Any two or
more offices may be held by the same person. Officers may or
may not be Directors or shareholders of the Corporation.
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 convenient. Each Officer
shall hold officer until their successor shall have been duly
elected and shall have qualified or until their death or until
they shall resign or shall have been removed in the manner
hereinafter provided.
3. Resignations
Any Officer may resign at any time by delivering a written
resignation either to thePresident or to the Secretary.
Unless otherwise specified therein, such resignation shall
take effect upon delivery.
4. 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. Any such removal shall
require a majority vote of the Board of Directors, exclusive
of the Officer in question if he or she is also a Director.
5. Vacancies
A vacancy in any office because of death, resignation,
removal, disqualificaton or otherwise, or is a new officer
shall be created, may be filled by the Board of Directors for
the un-expired portion of the term.
6. President
The president shall be the chief executive and administrative
Officer of the Corporation. He or she shall preside at all
meetings of the stockholders and in the absence of the
Chairman of the Board, at meetings of the Board of Directors.
He or she shall exercise such duties as customarily pertain to
the office of President and shall have general and active
supervision over the property, business, and affairs of the
Corporation and over its several Officers, agents, or
employees other than those appointed by the Board of
Directors. He or she may sign, execute and deliver in the
name of the Corporation powers of attorney, contracts, bonds
and other obligations, and shall perform such other duties as
may be prescribed from time to time by the Board of Directors
or by the Bylaws.
7. Vice President
The Vice President shall have such powers and perform such
duties as may be assigned to him by the Board of Directors or
the President. In the absence or disability of the President,
the Vice President designated by the Board or the President
shall perform the duties and exercise the powers of the
President. A Vice President may sign and execute contracts
any other obligations pertaining to the regular course of
their duties.
8. Secretary
The Secretary shall keep the minutes of all meetings of the
stockholders and of the Board of Directors and, to the extent
ordered by the Board of Directors or the President, the
minutes of meeting of all committees. He or she shall cause
notice to be given of meetings of stockholders, of the Board
of Directors, and of any committee appointed by the Board. He
or she shall have custody of the corporate seal and general
charge of the records, documents and papers of the Corporation
not pertaining to the performance of the duties vested in
other Officers, which shall at all reasonable times be open to
the examination of any Directors. He or she may sign or
execute contracts with the President or a Vice President
thereunto authorized in the name of the Corporation and affix
the seal of the Corporation thereto. He or she shall perform
such other duties as may be prescribed from time to time by
the Board of Directors or by the Bylaws.
9. Treasurer
The Treasurer shall have general custody of the collection and
disbursement of funds of the Corporation. He or she shall
endorse on behalf of the Corporation for collection check,
notes and other obligations, and shall deposit the same to the
credit of the Corporation in such bank or banks or
depositories as the Board of Directors may designate. He or
she may sign, with the President or such other persons as may
be designated for the purpose of the Board of Directors, all
bills of exchange or promissory notes of the Corporation. He
or she shall enter or cause to be entered regularly in the
books of the Corporation full and accurate account of the
Corporation; shall at all reasonable times exhibit his (or
her) books and accounts to any Director of the Corporation
upon application at the office of the Corporation during
business hours; and, whenever required by the Board of
Directors or the President, shall render a statement of his
(or her) accounts. The Treasurer shall perform such other
duties as may be prescribed from time to time by the Board of
Directors or by the Bylaws.
10. Other Officers
Other Officers shall perform such duties and shall have such
powers as may be assigned to them by the Board of Directors.
11. Salaries
Salaries or other compensation of the Officers of the
Corporation shall be fixed from time to time by the Board of
Directors, except that the Board of Directors may delegate to
any person or group of persons the power to fix the salaries
or other compensation of any subordinate Officers or agents.
No Officer shall be prevented from receiving any such salary
or compensation by reason of the fact that he or she is also a
Director of the Corporation.
12. Surety Bonds
In case the Board of Directors shall so require, any Officer
or agent of the Corporation shall execute to the Corporation a
bond in such sums and with such surety or sureties as the
Board of Directors may direct, conditioned upon the faithful
performance of his (or her) duties to the Corporation,
including responsibility for negligence and for the accounting
for all property, monies or securities of the Corporation,
which may come into his (or her) hands.
Article V
Contracts, Loans, Checks and Deposits
1. Contracts
The Board of Directors may authorized 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.
2. Loans
No loan or advance shall be contracted on behalf of the
Corporation, no negotiable paper or other evidence of its
obligation under any loan or advance shall be issued in its
name, and no property of the Corporation shall be mortgaged,
pledged, hypothecated or transferred as security for the
payment of any loan, advance, indebtedness or liability of the
Corporation unless and except as authorized by the Board of
Directors. Any such authorization may be general or confined
to specific instances.
3. 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 depositories as the
Board of Directors may select, or as may be selected by an
Officer or agent of the Corporation authorized to do so by the
Board of Directors.
4. Checks and Drafts
All notes, drafts, acceptances, checks, endorsements and
evidence of indebtedness of the Corporation and in such manner
as the Board of Directors from time to time may determine.
Endorsements for deposits to the credit of the Corporation in
any of its duly authorized depositories shall be made in such
manner as the Board of Directors may from time to time
determine.
5. Bonds and Debentures
Every bond or debenture issued by the Corporation shall be in
the form of an appropriate legal writing, which shall be
signed by the President or Vice President and by the Treasurer
or by the Secretary, and sealed with the seal of the
Corporation. The seal may be facsimile, engraved or printed.
Where such bond or debenture is authenticated with the manual
signature of an authorized Officer of the Corporation or other
trustee designated by the indenture of trust or other
agreement under which such security is issued, the signature
of any of the Corporation's Officers named thereon may be
facsimile. In case any Officer who signed, or whose facsimile
signature has been used on any such bond or debenture, shall
cease to be an Officer of the Corporation, such bond or
debenture may nevertheless be adopted by the Corporation and
issued and delivered as though the person who signed it or
whose facsimile signature has been used thereon had not ceased
to be such Officer.
Article VI
Capital Stock
1. Certificate of Share
The shares of the Corporation shall be represented by
certificates prepared by the Board of Directors and signed by
the President. The signatures of such Officers upon a
certificate may be facsimiles if the certificate is
countersigned by a transfer agent or registered by a registrar
other than the Corporation itself or one of its employees.
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
except that in case of a lost, destroyed or mutilated
certificate, a new one may be issued therefore upon such terms
and indemnity to the Corporation as the Board of Directors may
prescribe.
2. Transfer of Shares
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 (or her) legal representative, who
shall furnish proper evidence of authority to transfer, or by
his (or her) 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 dates. The person in whose name share
stand on the books of the Corporation shall be deemed by the
Corporation to be the owner thereof for all purposes.
3. Transfer Agent and Registrar
The Board of Directors of the Corporation shall have the power
to appoint one or more transfer agents and registrars for the
transfer and registration of certificates of stock of any
class, and may require that stock certificates shall be
countersigned and registered by one or more of such transfer
agents and registrars.
4. Lost or Destroyed Certificates
The Corporation may issue a new certificate to replace any
certificate theretofore issued by it alleged to have been lost
or destroyed. The Board of Directors may require the owner of
such a certificate or his (or her) legal representative to
give the Corporation a bond in such sum and with such sureties
as the Board of Directors may direct to indemnify the
Corporation as transfer agents and registrars, if any, against
claims that may be made on account of the issuance of such new
certificates. A new certificate may be issued without
requiring any bond.
5. Registered Shareholders
The Corporation shall be entitled to treat the holder of
record of any share or shares of stock as the holder thereof,
in fact, and shall not be bound to recognize any equitable or
other claim to or on behalf of this Corporation to any and all
of the rights and powers incident to the ownership of such
stock at any such meeting, and shall have power and authority
to execute and deliver proxies and consents on behalf of this
Corporation in connection with the exercise by this
Corporation of the rights and powers incident to the ownership
of such stock. The Board of Directors, from time to time, may
confer like powers upon any other person or persons.
Article VII
Indemnification
No Officer or Director shall be personally liable for any
obligations of the Corporation or for any duties or obligations
arising out of any acts or conduct of said Officer or Director
performed for or on behalf of the Corporation. The Corporation
shall and does hereby indemnify and hold harmless each person and
their heirs and administrators who shall serve at any time
hereafter as a Director or Officer of the Corporation from and
against any and all claims, judgments and liabilities to which
such persons shall become subject by reason of their having
heretofore or hereafter been a Director or Officer of the
Corporation, or by reason of any action alleged to have
heretofore or hereafter taken or omitted to have been taken by
him as such Director or Officer, and shall reimburse each such
person for all legal and other expenses reasonably incurred by
him in connection with any such claim or liability, including
power to defend such persons from all suits or claims as provided
for under the provisions of the Nevada Revised Statutes;
provided, however, that no such persons shall be indemnified
against, or be reimbursed for, any expense incurred in connection
with any claim or liability arising out of his (or her) own
negligence or willful misconduct. The rights accruing to any
person under the foregoing provisions of this section shall not
exclude any other right to which he or she may lawfully be
entitled, nor shall anything herein contained restrict the right
of the Corporation to indemnify or reimburse such person in any
proper case, even though not specifically herein provided for.
The Corporation, its Directors, Officers, employees and agents
shall be fully protected in taking any action or making any
payment, or in refusing so to do in reliance upon the advice of
counsel.
Article VIII
Notice
Whenever any notice is required to be given to any shareholder or
Director of the Corporation under the provisions of the Articles
of Incorporation, or under the provisions of the Nevada Revised
Statutes, a waiver thereof in writing signed by the person or
persons entitled to such notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such
notice. Attendance at any meeting shall constitute a waiver of
notice of such meetings, except where attendance is for the
express purpose of objecting to the holding of that meeting.
Article IX
Amendments
These Bylaws may be altered, amended, repealed, or new Bylaws
adopted by a majority of the entire Board of Directors at any
regular or special meeting. Any Bylaw adopted by the Board may
be repealed or changed by the action of the shareholders.
Article X
Fiscal Year
The fiscal year of the Corporation shall be fixed and may be
varied by resolution of the Board of Directors.
Article XI
Dividends
The Board of Directors may at any regular or special meeting, as
they deem advisable, declare dividends payable out of the surplus
of the Corporation.
Article XII
Corporate Seal
The seal of the Corporation shall be in the form of a circle and
shall bear the name of the Corporation and the year of
incorporation per sample affixed.
Dated Monday, October 16, 1995 Bach-Hauser, Inc.
/s/ Charles F. Richards, Jr.
Charles F. Richards, Jr.
Secretary
