U.S. SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
Under Section 12(g) of
The Securities Exchange Act of 1934
SOLAR ENTERPRISES, INC.
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(Name of Small Business Issuer in its charter)
NEVADA 88-0354942
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
16133 VENTURA BOULEVARD, SUITE 635
ENCINO, CALIFORNIA 91436
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(Address of principal executive offices) (Zip code)
Issuer's telephone number: (818) 981-1796
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:
$.001 COMMON STOCK
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(Title of Class)
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TABLE OF CONTENTS
Page
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PART I
Item 1. Description of Business . . . . . . . . . . . . . . . . . 3
Item 2. Plan of Operation . . . . . . . . . . . . . . . . . . . . 9
Item 3. Description of Property. . . . . . . . . . . . . . . . . . 14
Item 4. Security Ownership of Certain
Beneficial Owners and Management . . . . . . . . . . . . 15
Item 5. Directors, Executive Officers, Promoters
and Control Persons. . . . . . . . . . . . . . . . . . . 16
Item 6. Executive Compensation . . . . . . . . . . . . . . . . . . 18
Item 7. Certain Relationships and
Related Transactions. . . . . . . . . . . . . . . . . . 19
Item 8. Description of Securities. . . . . . . . . . . . . . . . . 19
PART II
Item 1. Market for Common Equities and Related Stockholder
Matters . . . . . . . . . . . . . .. . . . . . . . . . . 21
Item 2. Legal Proceedings. . . . . . . . . . . . . . . . . . . . . 23
Item 3. Changes in and Disagreements with Accountants. . . . . . . 23
Item 4. Recent Sales of Unregistered Securities. . . . . . . . . . 23
Item 5. Indemnification of Directors and Officers. . . . . . . . . 26
PART F/S
Financial Statements. . . . . . . . . . . . . . . . . . . . 26
Table of Contents. . . . . . . . . . . . . . . . . . . . . 27
PART III
Item 1. Index to Exhibits. . . . . . . . . . . . . . . . . . . . . 28
Signatures . . . . . . . . . . . . . . . . . . . . . . . . 29
2.
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PART I
Item 1. Description of Business
Solar Enterprises, Inc. (the "Company") was incorporated on
March 12, 1996, under the laws of the State of Nevada to engage in any lawful
corporate activity, including, but not limited to, selected mergers and
acquisitions. 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. 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
Board of Directors of the Company has elected to commence implementation of the
Company's principal business purpose described below under "Item 2 - Plan of
Operation." The proposed business activities described herein may classify the
Company as a "blank check" company.
The Company is filing this registration statement on a voluntary
basis because the primary attraction of the Company as a merger partner or
acquisition vehicle will be its status as a public company. Any business
combination or transaction will likely result in a significant issuance of
shares and substantial dilution to present stockholders of the Company.
In addition, the Company is filing this registration statement
to enhance investor protection and to provide information if a trading market
commences. On December 11, 1997, the National Association of Securities Dealers,
Inc. (NASD) announced that its Board of Governors had approved a series of
proposed changes for the Over The Counter ("OTC") Bulletin Board and the OTC
market. The principal changes, which were approved by the Securities and
Exchange Commission on January 4, 1999 allows only those companies that report
their current financial information to the Securities and Exchange Commission,
banking, or insurance regulators to be quoted on the OTC Bulletin Board. The
rule provides for a phase-in period for those securities already quoted on the
OTC Bulletin Board.
Risk Factors
The Company's business is subject to numerous risk factors, including
the following:
1. Lack of History.
The Company has had no operating history nor any 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 the consummation of a business
combination. This may result in the Company incurring a net operating loss which
will increase continuously until the Company can consummate a business
combination with a profitable business opportunity. There is no assurance that
the Company can identify such a business opportunity and consummate such a
business combination.
3.
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2. The Company's Proposed Operations is Speculative.
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 combination(s) with entities having established operating histories,
there can be no assurance that the Company will be successful in locating
candidates meeting such criteria. In the event the Company completes a business
combination, of which there can be no assurance, the success of the Company's
operations may be dependent upon management of the successor firm or venture
partner firm and numerous other factors beyond the Company's control.
3. 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 with, joint ventures with and
acquisitions of small private and public entities. A large number of established
and well-financed entities, including venture capital firms, are active in
mergers and acquisitions of companies which may be desirable target candidates
for the Company. Nearly all such entities have significantly greater financial
resources, technical expertise and managerial capabilities than the Company and,
consequently, the Company will be at a competitive disadvantage in identifying
possible business opportunities and successfully completing a business
combination. Moreover, the Company will also compete in seeking merger or
acquisition candidates with numerous other small public companies.
4. The Company has No Agreement for a Business Combination or Other
Transaction - No Standards for Business Combination.
The Company has no arrangement, agreement or understanding with
respect to engaging in a merger with, joint venture with or acquisition of, a
private or public entity. There can be no assurance the Company will be
successful in identifying and evaluating suitable business opportunities or in
concluding a business combination. Management has not identified any particular
industry or specific business within an industry for evaluation by the Company.
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.
4.
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5. Continued Management Control, Limited Time Availability.
While seeking a business combination, management anticipates
devoting up to ten hours per month to the business of the Company. None of the
Company's officers has entered into a written employment agreement with the
Company and none is expected to do so in the foreseeable future. The Company has
not obtained key man life insurance on any of 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 "Item 5 - Directors, Executive Officers, Promoters and Control
Persons."
6. There May Be Conflicts of Interest. Officers and directors of the
Company may in the future participate in business ventures which could be deemed
to compete directly with the Company.
Additional conflicts of interest and non-arms length
transactions may also arise in the future in the event the Company's officers or
directors are involved in the management of any firm with which the Company
transacts business. Management has adopted a policy that the Company will not
seek a merger with, or acquisition of, 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.
7. Reporting Requirements May Delay or Preclude Acquisitions.
Sections 13 and 5(d) of the Securities Exchange Act of 1934 (the
"1934 Act"), require companies subject thereto to provide certain information
about significant acquisitions, including certified financial statements for the
company acquired, covering one, two, or three 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
essentially preclude consummation of an otherwise desirable acquisition by the
Company. 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.
8. Lack of Market Research or Marketing Organization.
The Company has neither conducted, nor have others made
available to it, 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. Even in the
event demand is identified for a merger or acquisition contemplated by the
Company, there is no assurance the Company will be successful in completing any
such business combination.
5.
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9. Lack of Diversification.
The Company's proposed operations, even if successful, will in
all likelihood result in the Company engaging in a business combination with a
business opportunity. Consequently, the Company's activities may be limited to
those engaged in by business opportunities which the Company merges with or
acquires. 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 and therefore increase the risks associated with the
Company's operations.
10. Regulation.
Although the Company will be subject to regulation under the
1934 Act, 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.
11. Probable Change in Control and Management.
A business combination involving the issuance of the Company's
Common Shares 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 Shares 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.
12. 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 any such private company. The
issuance of previously authorized and unissued Common Shares of the Company
would result in reduction in percentage of shares owned by present and
prospective shareholders of the Company and may result in a change in control or
management of the Company.
6.
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13. 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 business
opportunity 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. Such 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 laws enacted for the
protection of investors.
14. Taxation. Federal and state tax consequences will, in all likelihood,
be major considerations in any business combination the Company may undertake.
Currently, such transactions may be structured so as 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; however, there can be no assurance that such business combination
will meet the statutory requirements of 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.
15. Requirement of Audited Financial Statements May Disqualify Business
Opportunities.
Management of the Company believes that any potential business
opportunity must provide audited financial statements for review, for the
protection of all parties to the business combination. One or more attractive
business opportunities may choose to forego the possibility of a business
combination with the Company, rather than incur the expenses associated with
preparing audited financial statements.
16. Dilution.
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.
17. No Trading Market.
There is no trading market for the Company's common stock at
present, and there has been no trading market to date. There is no assurance
that a trading market will ever develop or, if such market does develop, that it
will continue. The Company intends to request a broker-dealer to make
application to the NASD Regulation, Inc. to have the Company's securities traded
on the OTC Bulletin Board or published in print and electronic media, or either,
in the National Quotation Bureau LLC "Pink Sheet."
7.
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18. Required Year 2000 Compliance.
A business combination will, in all likelihood, result in the
Company disclosing additional Year 2000 matters. Many existing computer programs
use only two digits to identify a year in the date field. These programs were
designed and developed without considering the impact of the upcoming change in
the century. If not corrected, many computer applications could fail or create
erroneous results by or at the Year 2000. The Year 2000 issue affects virtually
all companies and organizations.
19. Disclosure by Public Companies Regarding the Year 2000 Issue.
The business combination will require specific Year 2000
disclosures. Management of the Company believes that any potential business
opportunity may require a disclosure that many companies must undertake major
projects to address the Year 2000 issue. The disclosure of the potential costs
and uncertainties will depend on a number of factors, including its software and
hardware and the nature of its industry. Companies also must coordinate with
other entities with which they electronically interact, both domestically and
globally, including suppliers, customers, creditors, borrowers, and financial
service organizations. If the Company does not successfully address its Year
2000 issues, the Company may face material adverse consequences. The Company
will be required to review, on an ongoing basis, whether it needs to disclose
anticipated costs, problems and uncertainties associates with Year 2000
consequences, particularly in their filings with the Securities and Exchange
Commission. The Company may have to disclose this information in the Securities
and Exchange Commission filings because (i) the form or report may require the
disclosure, or (ii) in addition to the information that the Company is
specifically required to disclose, the disclosure rules require disclosure of
any additional material information necessary to make the required disclosure
not misleading.
If the Company determines that it should make a Year 2000
disclosure, applicable rules or regulations must be followed. If the Company has
not made an assessment of its Year 2000 issues or has not determined whether it
has material Year 2000 issues, a disclosure of this known uncertainty is
required. In addition, the Securities and Exchange Commission staff believes
that the determination as to whether the Company's Year 2000 issues should be
disclosed should be based on whether the Year 2000 issues are material to the
Company's business, operations, or financial condition, without regard to
related countervailing circumstances (such as Year 2000 remediation programs or
contingency plans). If the Year 2000 issues are determined to be material,
without regard to countervailing circumstances, the nature and potential impact
of the Year 2000 issues as well as the countervailing circumstances will be
required. As part of this disclosure, the following topics will be addressed:
o the Company's general plans to address the Year 2000 issues
relating to its business, its operations (including operating
systems) and, if material, its relationships with customers,
suppliers, and other constituents; and its timetable for
carrying out those plans; and
8.
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o the total dollar amount that the Company estimates will be spent
to remediate its year 2000 issues, if such amount is expected to
be material to the Company's business, operations or financial
condition, and any material impact these expenditures are
expected to have on the Company's results of operations,
liquidity and capital resources.
Item 2. Plan of Operation
The Company intends to seek to acquire assets or shares of an
entity actively engaged in business which generates revenues in exchange for its
securities. The Company has no particular acquisitions in mind and has not
entered into any negotiations regarding such an acquisition. None of the
Company's officers, directors, promoters or affiliates have engaged in any
preliminary contact or discussions with any representative of any other company
regarding the possibility of an acquisition or merger between the Company and
such other company as of the date of this registration statement.
The Company has no full time or part-time employees.
None of the officers and directors anticipates devoting more
than ten (10%) percent of his or her time to Company activities. The Company's
President and Secretary have agreed to allocate a portion of said time to the
activities of the Company, without compensation. These officers anticipate that
the business plan of the Company can be implemented by their devoting minimal
time per month to the business affairs of the Company and, consequently,
conflicts of interest may arise with respect to the limited time commitment by
such officers. See "Item 5 - Directors, Executive Officers, Promoters and
Control Persons - Resumes."
General Business Plan
The Company's purpose is to seek, investigate and, if such
investigation warrants, acquire an interest in business opportunities presented
to it by persons or firms who or which desire to seek the advantages of an
Issuer who has complied with the 1934 Act. The Company will not restrict its
search to any specific business, industry, or geographical location and the
Company may participate in a business venture of virtually any kind or nature.
This discussion of the proposed business is purposefully general and is not
meant to be restrictive of the Company's virtually unlimited discretion to
search for and enter into potential business opportunities. Management
anticipates that it may be able to participate in only one potential business
venture because the Company has nominal assets and limited financial resources.
See Item F/S, "Financial Statements." This lack of diversification should be
considered a substantial risk to shareholders of the Company because it will not
permit the Company to offset potential losses from one venture against gains
from another.
9.
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The Company may seek a business opportunity with entities which
have recently commenced operations, or which wish to utilize the public
marketplace in order to raise additional capital in order to expand into new
products or markets, to develop a new product or service, or for other corporate
purposes. The Company may acquire assets and establish wholly owned subsidiaries
in various businesses or acquire existing businesses as subsidiaries.
The Company anticipates that the selection of a business
opportunity in which to participate will be complex and extremely risky. Due to
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 an Issuer who has complied with the
1934 Act. Such benefits may include facilitating or improving the terms on which
additional equity financing may be sought, providing liquidity for incentive
stock options or similar benefits to key employees, providing liquidity (subject
to restrictions of applicable statutes), for all shareholders and other factors.
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.
The Company has, and will continue to have, no capital with
which to provide the owners of business opportunities with any significant cash
or other assets. However, management believes the Company will be able to offer
owners of acquisition candidates the opportunity to acquire a controlling
ownership interest in an Issuer who has complied with the 1934 Act without
incurring the cost and time required to conduct an initial public offering. The
owners of the business opportunities will, however, incur significant legal and
accounting costs in connection with acquisition of a business opportunity,
including the costs of preparing Form 8-K's, 10-K's or 10-KSB's, agreements and
related reports and documents. The 1934 Act, specifically requires that any
merger or acquisition candidate comply with all applicable reporting
requirements, which include providing audited financial statements to be
included within the numerous filings relevant to complying with the 1934 Act.
Nevertheless, the officers and directors of the Company have not conducted
market research and are not aware of statistical data which would support the
benefits of a merger or acquisition transaction for the owners of a business
opportunity.
The Company has made no determination as to whether or not it
will file periodic reports in the event its obligation to file such reports is
suspended under the 1934 Act. Hagit Bernstein, an officer and director of the
Company, has agreed to provide the necessary funds, without interest, for the
Company to comply with the 1934 Act reporting requirements, provided that she is
an officer and director of the Company when the obligation is incurred.
The analysis of new business opportunities will be undertaken
by, or under the supervision of, the officers and directors of the Company, none
of whom is a professional business analyst. Management intends to concentrate on
identifying preliminary prospective business opportunities which may be brought
to its attention through present associations of the Company's officers and
directors, or by the Company's shareholders. In analyzing prospective business
opportunities, management will consider such matters as the available technical,
financial and managerial resources; working capital and other financial
requirements; history of operations, if any; prospects for the future; nature of
present and expected competition; the quality and experience of management
10.
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services which may be available and the depth of that management; the potential
for further research, development, or exploration; specific risk factors not now
foreseeable but which then may be anticipated to impact the proposed activities
of the Company; the potential for growth or expansion; the potential for profit;
the public recognition of acceptance of products, services, or trades; name
identification; and other relevant factors. Officers and directors of the
Company expect to meet personally with management and key personnel of 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 within a
reasonable period of time after closing of the proposed transaction.
Management of the Company, while not especially experienced in
matters relating to the new business of the Company, will rely upon their own
efforts in accomplishing the business purposes of the Company. It is not
anticipated that any outside consultants or advisors 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 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 contracts or agreements with any outside consultants and none are
anticipated in the future.
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 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.
It is anticipated that the Company will incur nominal expenses
in the implementation of its business plan described herein. Because the Company
has no capital with which to pay these anticipated expenses, present management
of the Company will pay these charges with their personal funds, as interest
free loans to the Company or as capital contributions. However, if loans, the
only opportunity which management has to have these loans repaid will be from a
prospective merger or acquisition candidate. Management has agreed among
themselves that the repayment of any loans made on behalf of the Company will
not impede, or be made conditional in any manner, to consummation of a proposed
transaction.
The Company has no plans, proposals, arrangements, or
understanding with respect to the sale or issuance of additional securities
prior to the location of an acquisition or merger candidate.
11.
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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, or licensing agreement with another corporation
or entity. It may also acquire stock or assets of an existing business. On the
consummation of a transaction, it is probable that the present management and
shareholders of the Company will no longer be in control of the Company. In
addition, the Company's directors may, as part of the terms of the acquisition
transaction, resign and be replaced by new directors without a vote of the
Company's shareholders or may sell their stock in the Company. Any terms of sale
of the shares presently held by officers and/or directors of the Company will be
also afforded to all other shareholders of the Company on similar terms and
conditions. Any and all such sales will only be made in compliance with the
securities laws of the United States and any applicable state.
It is anticipated that any securities issued in any such
reorganization would be issued in reliance upon exemption from registration
under applicable federal and state securities laws. In some circumstances,
however, as a negotiated element of its transaction, the Company may agree to
register all or a part of such securities immediately after the transaction is
consummated or at specified times thereafter. If such registration occurs, of
which there can be no assurance, it will be undertaken by the surviving entity
after the Company has successfully consummated a merger or acquisition and the
Company is no longer considered a "shell" company. The issuance of substantial
additional securities and their potential sale into any trading market which may
develop in the Company's securities may have a depressive effect on the value of
the Company's securities in the future, if such a market develops, of which
there is no assurance.
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 (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, would retain less than 20% of the issued and outstanding shares of the
surviving entity, which would 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 of 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 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 negotiation strength of the
Company and such other management.
12.
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With respect to any merger or acquisition, negotiations with
target company management is expected to focus on the percentage of the Company
which the target company shareholders would acquire in exchange for all of 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 substantially 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.
The Company will participate in a business opportunity only
after the negotiation and execution of appropriate written agreements. Although
the terms of such agreements cannot be predicted, generally such agreements will
require some specific representations and warranties by all of the parties
thereto, will specify certain events of default, will detail the terms of
closing and the conditions which must be satisfied by each of the parties prior
to and after such closing, will outline the manner of bearing costs, including
costs associated with the Company's attorneys and accountants, will set forth
remedies on default and will include miscellaneous other terms.
As stated hereinabove, the Company will not acquire or merge
with any entity which cannot provide independent audited financial statements
within a reasonable period of time after closing of the proposed transaction.
The Company is subject to all of the reporting requirements included in the 1934
Act. Included in these requirements is the affirmative duty of the Company to
file independent audited financial statements as part of its Form 8-K to be
filed with the Securities and Exchange Commission upon consummation of a merger
or acquisition, as well as the Company's audited financial statements included
in its annual report on Form 10-K (or 10-KSB, as applicable). If such audited
financial statements are not available at closing, or within time parameters
necessary to insure the Company's compliance with the requirements of the 1934
Act, or if the audited financial statements provided do not conform to the
representations made by the candidate to be acquired in the closing documents,
the closing documents will provide that the proposed transaction will be
voidable, at the discretion of the present management of the Company. If such
transaction is voided, the agreement will also contain a provision providing for
the acquisition entity to reimburse the Company for all costs associated with
the proposed transaction.
13.
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Competition
The Company will remain an insignificant participant among the
firms which engage in the acquisition of business opportunities. There are many
established venture capital and financial concerns which have significantly
greater financial and personnel resources and technical expertise than the
Company. In view of the Company's combined extremely limited financial resources
and limited management availability, the Company will continue to be at a
significant competitive disadvantage compared to the Company's competitors.
Investment Company Act of 1940
Although the Company will be subject to regulation under the
Securities Act of 1933, as amended, and the 1934 Act, 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. The Company's Board
of Directors unanimously approved a resolution stating that it is the Company's
desire to be exempt from the Investment Company Act of 1940 under Regulation
3a-2 thereto.
Lock-Up Agreement
Each of the officers and directors of the Company has executed
and delivered a "lock-up" letter agreement affirming that they shall not sell
their respective shares of the Company's common stock until such time as the
Company has entered into a merger or acquisition agreement, or the Company is no
longer classified as a "blank check" company, whichever first occurs.
Item 3. Description of Property
The Company has no properties and at this time has no agreements
to acquire any properties.
The Company presently occupies office space supplied by a
shareholder at 16133 Ventura Boulevard, Suite 635, Encino, California 91436.
This space is provided to the Company on a rent-free basis, and it is
anticipated that this arrangement will remain until such time as the Company
successfully consummates a merger or acquisition. Management believes that this
arrangement will meet the Company's needs for the foreseeable future.
14.
<PAGE>
Item 4. Security Ownership of Certain Beneficial Owners and Management
(a) Security Ownership of Certain Beneficial Owners.
The following table sets forth the security and beneficial ownership for
each class of equity securities of the Company beneficially owned by all
directors and officers of the Company.
Name and Amount and
Address of Nature of
Title of Beneficial Beneficial Percent
Class Owner Owner of Class (1)
- --------- ---------- ----------- ---------
Common Hagit Bernstein 320,000 28.55
16133 Ventura Boulevard
Encino, California 91436
Common Raphi Shram 320,000 28.55
41 Edmond Seager Drive
Thornhill, Ontario, Canada L4JSB1
Common Amnon Even 240,000 21.41
11270 Exposition Boulevard
Suite 64151
Los Angeles, California 90064
Common All Officers and 880,000 78.51
Directors as a Group
(three [3] individuals)
(b) Security Ownership of Management.
Name and Amount and
Address of Nature of
Title of Beneficial Beneficial Percent
Class Owner Owner of Class (1)
- --------- ---------- ----------- ---------
Common Hagit Bernstein 320,000 28.55
16133 Ventura Boulevard
Encino, California 91436
Common Raphi Shram 320,000 28.55
41 Edmond Seager Drive
Thornhill, Ontario, Canada L4JSB1
Common Amnon Even 240,000 21.41
11270 Exposition Boulevard
Suite 64151
Los Angeles, California 90064
Common All Officers and 880,000 78.51
Directors as a Group
(three [3] individuals)
(1) Percent of class is based on 1,121,000 shares of Common Stock outstanding
as of January 15, 2000. The total of the Company's outstanding Common
Shares are held by 25 persons.
15.
<PAGE>
Item 5. Directors, Executive Officers, Promoters and Control Persons.
The directors and officers of the Company are as follows:
Name Age Position
---- --- --------
Hagit Bernstein 28 President/Secretary/Director
Raphi Shram 54 Treasurer/Director
Amnon Even 35 Director
The above listed officers and directors will serve until the
next annual meeting of the shareholders or until their death, resignation,
retirement, removal, or disqualification, or until their successors have been
duly elected and qualified. Vacancies in the existing Board of Directors are
filled by majority vote of the remaining Directors. Officers of the Company
serve at the will of the Board of Directors. There are no agreements or
understandings for any officer or director to resign at the request of another
person and no officer or director is acting on behalf of or will act at the
direction of any other person. There is no family relationship between any
executive officer and director of the Company.
Resumes
Hagit Bernstein
- ---------------
Hagit Bernstein has been a major shareholder of the Company since 1996 and has
been its President and a director of the Company since 1999. Ms. Bernstein is
currently a visual presentation designer working as a freelance consultant
internationally. She has been working at the Expo unit of Home Depot for two
years, and was previously employed by Macy's as an interior designer. Ms.
Bernstein is a graduate of the Fashion Institute of Design and Management in Los
Angeles.
Raphi Shram
- -----------
Raphi Shram has been a major shareholder of the Company since 1996 and has been
its Treasurer and a director of the Company since 1999. Mr. Shram has been a
real estate developer in the Toronto metropolitan area for 15 years and has been
involved in different businesses in various industries. Mr. Shram has broad
experienced in numerous industries and in the financial markets.
Amnon Even
- ----------
Amnon Even has been a major shareholder of the Company since 1996 and has been a
director since 1999. Mr. Even is a graduate of the University of California, Los
Angeles and a former military intelligence officer. Mr. Even is founder and CEO
of a successful import and export company and has traveled the world
extensively, specializing in international trade and commerce.
16.
<PAGE>
Previous Blank Check Companies - Current
Blank Check Companies
The officers and directors of the Company have not been officers
and directors in any other blank check offerings. The officers and directors,
however, do anticipate becoming involved with additional blank check companies
who may file registration statements under the Securities Act of 1933, as
amended, and the 1934 Act, or either. In addition, the officers and directors of
the Company may become involved in additional blank check companies which may
request a broker-dealer to request clearance from the NASD Regulation, Inc. for
trading clearance in the applicable quotation medium.
Conflicts of Interest
Members of the Company's management are associated with other
firms involved in a range of business activities. Consequently, there are
potential inherent conflicts of interest in their acting as officers and
directors of the Company. 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 are now and may in the
future become shareholders, officers or directors of other companies which may
be engaged in business activities similar to those conducted by the Company.
Accordingly, additional direct conflicts of interest may arise in the future
with respect to such individuals acting on behalf of the Company or other
entities. Moreover, additional conflicts of interest may arise with respect to
opportunities which come to the attention of such individuals in the performance
of their duties or otherwise. 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.
If the Company or the companies in which the officers and directors are
affiliated with both desire to take advantage of an opportunity, then said
officers and directors would abstain from negotiating and voting upon the
opportunity. However, all directors may still individually take advantage of
opportunities if the Company should decline to do so. Except as set forth above,
the Company has not adopted any other conflict of interest policy with respect
to such transactions.
17.
<PAGE>
Item 6. Executive Compensation.
None of the Company's officers and/or directors receive any
compensation for their respective services rendered unto the Company, nor have
they received such compensation in the past. They all have agreed to act without
compensation until authorized by the Board of Directors, which is not expected
to occur until the Company 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 a number of 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.
18.
<PAGE>
No retirement, pension, profit sharing, stock option or
insurance programs or other similar programs have been adopted by the Company
for the benefit of its employees.
Item 7. Certain Relationships and Related Transactions.
There have been no related party transactions, or any other
transactions or relationships required to be disclosed pursuant to Item 404 of
Regulation S-B.
Hagit Bernstein has agreed to provide the necessary funds,
without interest, for the Company to comply with the 1934 Act provided that she
is an officer and director of the Company when the obligation is incurred. All
advances will be interest-free.
Item 8. Description of Securities.
The Company's authorized capital stock consists of 75,000,000
shares of Common Stock and 10,000,000 shares of Preferred Stock, par value $.001
per share. There are 1,121,000 Common Shares issued and outstanding as of the
date of this filing.
Common Stock
- ------------
All shares of Common Stock have equal voting rights and, when
validly issued and outstanding, are entitled to one vote per share in all
matters to be voted upon by shareholders. The shares of Common Stock have no
preemptive, subscription, conversion or redemption rights and may be issued only
as fully-paid and non-assessable shares. Cumulative voting in the election of
directors is not permitted, which means that the holders of a majority of the
issued and outstanding shares of Common Stock represented at any meeting at
which a quorum is present will be able to elect the entire Board of Directors if
they so choose and, in such event, the holders of the remaining shares of Common
Stock will not be able to elect any directors. In the event of liquidation of
the Company, each shareholder is entitled to receive a proportionate share of
the Company's assets available for distribution to shareholders after the
payment of liabilities and after distribution in full of preferential amounts,
if any. All shares of the Company's Common Stock issued and outstanding are
fully-paid and non-assessable. Holders of the Common Stock are entitled to share
pro rata in dividends and distributions with respect to the Common Stock, as may
be declared by the Board of Directors out of funds legally available therefor.
19.
<PAGE>
Preferred Stock
- ---------------
The Company is authorized to issue 10,000,000 shares of "blank
check" preferred stock, par value $0.001 per share, in one or more series from
time to time with such designations, rights and preferences as may be determined
from time to time by the Board of Directors, including, but not limited to (i)
the designation of such series; (ii) the dividend rate of such series, the
conditions and dates upon which such dividends shall be payable, the relation
which such dividends shall bear to the dividends payable on any other class or
classes or series of our capital stock and whether such dividends shall be
cumulative or non-cumulative; (iii) whether the shares of such series shall be
subject to redemption for cash, property or rights, including securities of any
other corporation, by the Company or upon the happening of a specified event
and, if made subject to any such redemption, the times or events, prices, rates,
adjustments and other terms and conditions of such redemption; (iv) the terms
and amount of any sinking fund provided for the purchase or redemption of the
shares of such series (v) whether or not the shares of such series shall be
convertible into, or exchangeable for, at the option of either the holder or the
Company or upon the happening of a specified event, shares of any other class or
classes or of any other series of the same class of the Company's capital stock
and, if provision be made for the conversion or exchange, the times or events,
prices, rates, adjustments and other terms and conditions of such conversions or
exchanges; (vi) the restrictions, if any, on the issue or reissue of any
additional preferred stock; (vii) the rights of the holders of the shares of
such series upon the voluntary or involuntary liquidation, dissolution or
winding up of the Company; and (viii) the provisions as to voting, optional
and/or other special rights and preferences, if any, including, without
limitation, the right to elect one or more directors. Accordingly, the Board of
Directors is empowered, without stockholder approval, to issue preferred stock
with dividend, liquidation, conversion, voting or other rights which adversely
affect the voting power or other rights of the holders of the common stock. In
the event of issuance, the preferred stock could be utilized, under certain
circumstances, as a way of discouraging, delaying or preventing an acquisition
or change in control of the Company.
20.
<PAGE>
PART II
Item 1. Market Price for Common Equity and Related Stockholder Matters.
There is no trading market for the Company's Common Stock at
present and there has been no trading market to date. There is no assurance that
a trading market will ever develop or, if such a market does develop, that it
will continue. The Company intends to request a broker-dealer to make
application to the NASD Regulation, Inc. to have the Company's securities traded
on the OTC Bulletin Board Systems or published, in print and electronic media,
or either, in the National Quotation Bureau LLC "Pink Sheets."
(a) Market Price. The Company's Common Stock is not quoted at the present
time.
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 stock in both public offering 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.
For the initial listing in the NASDAQ SmallCap market, a company
must have net tangible assets of $4 million or market capitalization of $50
million or a net income (in the latest fiscal year or two of the last fiscal
years) of $750,000, a public float of 1,000,000 shares with a market value of $5
million. The minimum bid price must be $4.00 and there must be 3 market makers.
In addition, there must be 300 shareholders holding 100 shares or more, and the
company must have an operating history of at least one year or a market
capitalization of $50 million.
21.
<PAGE>
For continued listing in the NASDAQ SmallCap market, a company
must have net tangible assets of $2 million or market capitalization of $35
million or a net income (in the latest fiscal year or two of the last fiscal
years) of $500,000, a public float of 500,000 shares with a market value of $1
million. The minimum bid price must be $1.00 and there must be 2 market makers.
In addition, there must be 300 shareholders holding 100 shares or more.
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.
(b) Holders.
There are twenty-five (25) holders of the Company's Common
Stock. In 1996, the Company issued 1,121,000, as adjusted for the stock split,
of its Common Shares for cash. 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, as amended.
As of the date of this report, all of the issued and outstanding
shares of the Company's Common Stock are eligible for sale under Rule 144
promulgated under the Securities Act of 1933, as amended, subject to certain
limitations included in said Rule. Except for the officers and directors of the
Company, no shareholder has executed and delivered to the Company a "lock-up"
letter affirming that he or she shall not sell their respective shares of the
Company's Common Stock until such time as the Company has successfully
consummated a merger or acquisition and the Company is no longer classified as a
"blank check" company.
22.
<PAGE>
As of the date of this registration statement, 241,000 shares of
the Company's Common Stock held by non-affiliates are eligible for sale under
Rule 144 promulgated under the Securities Act of 1933, as amended, subject to
certain limitations included in said Rule. 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.
(c) Dividends.
The Company has not paid any dividends to date, and has no plans
to do so in the immediate future.
Item 2. Legal Proceedings.
There is no litigation pending or threatened by or against the
Company.
Item 3. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure.
The Company has not changed accountants since its formation and
there are no disagreements with the findings of said accountants.
Item 4. Recent Sales of Unregistered Securities.
(a) Securities sold.
The Company has sold and issued its securities during the three
year period preceding the date of this registration statement. All of the shares
of Common Stock of the Company were sold and issued on March 12, 1996 and have
been issued for investment purposes in a "private transaction" and are
"restricted" shares as defined in Rule 144 under the Securities Act of 1933, as
amended. These shares may not be offered for public sale except under Rule 144,
or otherwise, pursuant to said Act.
In summary, Rule 144 applies to affiliates (that is, control
persons) and non-affiliates when they resell restricted securities (those
purchased from the issuer or an affiliate of the issuer in nonpublic
transactions). Non-affiliates reselling restricted securities, as well as
affiliates selling restricted or nonrestricted securities, are not considered to
be engaged in a distribution and, therefore, are not deemed to be underwriters
as defined in Section 2(11) of the Securities Act of 1933, as amended, if six
conditions are met:
23.
<PAGE>
(1) Current public information must be available about the
issuer unless sales are limited to those made by non-affiliates after
two years.
(2) When restricted securities are sold, generally there must be
a one-year holding period.
(3) When either restricted or nonrestricted securities are sold
by an affiliate after one year, there are limitations on the amount of
securities that may be sold; when restricted securities are sold by
non-affiliates between the first and second years, there are identical
limitations; after two years, there are no volume limitations for
resales by non-affiliates.
(4) Except for sales of restricted securities made by
non-affiliates after two years, all sales must be made in brokers'
transactions as defined in Section 4(4) of the Securities Act of 1933,
as amended, or a transaction directly with a "market maker" as that term
is defined in Section 3(a)(38) of the 1934 Act.
(5) Except for sales of restricted securities made by
non-affiliates after two years, a notice of proposed sale must be filed
for all sales in excess of 500 shares or with an aggregate sales price
in excess of $10,000.
(6) There must be a bona fide intention to sell within a
reasonable time after the filing of the notice referred to in (5) above.
(b) Underwriters and other purchasers.
There were no underwriters in connection with the sale and
issuance of any securities.
All of the shareholders have had a pre-existing personal or
business relationship with the Company or its officers and directors. By reason
of their business experience, each have been involved financially and by virtue
of a time commitment in business projects with the officers of the Company.
Further, each of the shareholders have established a pre-existing personal
relationship with the officers and directors of the Company. The following are
the names of the 25 issuees and the number of shares purchased by each of them.
24.
<PAGE>
Name Number of Shares
---- ----------------
Hagit Bernstein 3,200
Raphi Shram 3,200
Amnon Even 2,400
Maya Rubin 205
Robert Godfried 205
Ronald Brown 100
Robert Cohen 100
Nancy Woods 100
Bruce Fawcett 100
Harrold Mandel 100
Rosalinda Warner 100
James Dayan 100
Phil Ladelfa 100
Saul Judah 100
Stanley Reinhart 100
Iris Elhanani 100
Claudio Grissola 100
Jonathan Goodman 100
Robert Salna 100
Glen Bartolini 100
Angela Hardy 100
Michael Savage 100
Calvin Weinryb 100
William Nance 100
Ira Rimer 100
------
11,210
(c) Consideration.
Each of the shares of stock were sold for cash. Prior to the
forward stock split, each shareholder paid $.10 per share for the shares, the
Company sold and issued 11,210 shares, and the aggregate consideration received
by the Company was $1,121.00.
(d) Exemption from Registration Relied Upon.
The sale and issuance of the shares of stock was exempt from
registration under the Securities Act of 1933, as amended, by virtue of section
4(2) as a transaction not involving a public offering. Each of the shareholders
had acquired the shares for investment and not with a view to distribution to
the public. From the date of the issuance to the date of this report, there were
no transfers of the stock sold and issued.
25.
<PAGE>
Item 5. Indemnification of Directors and Officers.
Except for acts or omissions which involve intentional
misconduct, fraud or known violation of law or for the payment of dividends in
violation of Nevada Revised Statutes, there shall be no personal liability of a
director or officer to the Company, or its stockholders for damages for breach
of fiduciary duty as a director or officer. The Company may indemnify any person
for expenses incurred, including attorneys fees, in connection with their good
faith acts if they reasonably believe such acts are in and not opposed to the
best interests of the Company and for acts for which the person had no reason to
believe his or her conduct was unlawful. The Company may indemnify the officers
and directors for expenses incurred in defending a civil or criminal action,
suit or proceeding as they are incurred in advance of the final disposition of
the action, suit or proceeding, upon receipt of an undertaking by or on behalf
of the director or officer to repay the amount of such expenses if it is
ultimately determined by a court of competent jurisdiction in which the action
or suit is brought determined that such person is fairly and reasonably entitled
to indemnification for such expenses which the court deems proper.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended, may be permitted to officers, directors or
persons controlling the Company pursuant to the foregoing, the Company has been
informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933, as amended, and is therefore unenforceable.
PART F/S
The Company's balance sheets as of December 31, 1999, February 28, 1999 and
February 28, 1998, and the related statements of operations, stockholders'
equity and cash flows for the period March 12, 1996 (inception) to December 31,
1999, have been examined to the extent indicated in his report by Barry L.
Friedman, P.C., independent certified accountant, and have been prepared in
accordance with generally accepted accounting principles and pursuant to
Regulation S-B as promulgated by the Securities and Exchange Commission and are
included herein, on the following pages, as Exhibit A, in response to Part F/S
of this Form 10-SB
26
<PAGE>
SOLAR ENTERPRISES, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
December 31, 1999
February 28, 1999
February 28, 1998
TABLE OF CONTENTS
----------------------------------------------------------------
PAGE
----
INDEPENDENT AUDITORS' REPORT ............................. 1
ASSETS ................................................... 2
LIABILITIES AND STOCKHOLDERS EQUITY. ..................... 3
STATEMENT OF OPERATIONS .................................. 4
STATEMENT OF STOCKHOLDERS' EQUITY ........................ 5
STATEMENT OF CASH FLOWS .................................. 6
NOTES TO FINANCIAL STATEMENTS ............................ 7-8
27
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board Of Directors
Solar Enterprises, Inc.
Encino, California
I have audited the accompanying Balance Sheets of Solar Enterprises, Inc. (A
Development Stage Company), as of December 31, 1999, February 28, 1999, and
February 28, 1998, and the related statements of operations, stockholders'
equity and cash flows for the period March 1, 1999, to December 31, 1999, and
the two years ended February 28, 1999, and February 28, 1998. 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 Solar Enterprises, Inc. (A
Development Stage Company), as of December 31, 1999, February 28, 1999, and
February 28, 1998, and the results of its operations and cash flows for the
period March 1, 1999, to December 28, 1999, and the two years ended February 28,
1999, and February 28, 1998, 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 #3 to the financial
statements, the Company 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 are also described in Note #3. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
BARRY L. FRIEDMAN, P.C.
Las Vegas, Nevada
January 13, 2000
F-1
<PAGE>
SOLAR ENTERPRISES, INC.
(A Development Stage Company)
BALANCE SHEET
ASSETS
December February February
31, 1999 28, 1999 28, 1998
-------- -------- --------
CURRENT ASSETS $ 0 $ 0 $ 0
-------- -------- --------
TOTAL CURRENT ASSETS $ 0 $ 0 $ 0
-------- -------- --------
OTHER ASSETS $ 0 $ 0 $ 0
-------- -------- --------
TOTAL OTHER ASSETS $ 0 $ 0 $ 0
-------- -------- --------
TOTAL ASSETS $ 0 $ 0 $ 0
======== ======== ========
The accompanying notes are an integral part of these financial statements
F-2
<PAGE>
SOLAR ENTERPRISES, INC.
(A Development Stage Company)
BALANCE SHEET
LIABILITIES AND STOCKHOLDERS' EQUITY
December February February
31, 1999 28, 1999 28, 1998
-------- -------- --------
CURRENT LIABILITIES $ 0 $ 0 $ 0
-------- -------- --------
TOTAL CURRENT LIABILITIES $ 0 $ 0 $ 0
-------- -------- --------
STOCKHOLDERS' EQUITY (Note #1)
Common stock, no par value
authorized 25,000 shares
issued and outstanding at
February 28, 1998-11,210 shares $ 1,121
February 28, 1999-11,210 shares $ 1,121
December 31, 1999-11,210 shares $ 1,121
Additional paid in Capital 0 0 0
Deficit accumulated during
the development stage -1,121 -1,121 -1,121
-------- -------- --------
TOTAL STOCKHOLDERS EQUITY $ 0 $ 0 $ 0
-------- -------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 0 $ 0 $ 0
======== ======== ========
The accompanying notes are an integral part of these financial statements
F-3
<PAGE>
SOLAR ENTERPRISES, INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS
Mar. 1, Year Year Mar.12,1996
1999, to Ended Ended (inception)
Dec. 31, Feb. 28, Feb. 28, to Dec. 31,
1999 1999 1998 1999
-------- ------ ------- -----------
INCOME
Revenue $ 0 $ 0 $ 0 $ 0
-------- ------ ------- -------
EXPENSES
General, Selling and
Administrative $ 0 $ 0 $ 0 $ 1,121
-------- ------ ------- -------
Total Expenses $ 0 $ 0 $ 0 $ 1,121
-------- ------ ------- -------
Profit/Loss(-) $ 0 $ 0 $ 0 $-1,121
======== ====== ======= =======
Net Profit/Loss(-)
per weighted
share (Note #1) $ NIL $ NIL $ NIL $-.1000
======== ====== ======= =======
Weighted average
number of common
shares outstanding 11,210 11,210 11,210 11,210
======== ====== ======= =======
The accompanying notes are an integral part of these financial statements
F-4
<PAGE>
SOLAR ENTERPRISES, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
Common Stock Additional Accumu-
-------------- paid-in lated
Shares Amount capital Deficit
------ ------ --------- ----------
Balance,
February 28, 1997 11,210 $1,121 $ 0 $ -1,121
Net loss year ended
February 28, 1998 0
------ ------ --------- ---------
Balance,
February 28, 1998 11,210 $1,121 $ 0 $ -1,121
Net loss year ended
February 28, 1999 0
------ ------ --------- ---------
Balance,
February 28, 1999 11,210 $1,121 $ 0 $ -1,121
Net loss March 1,
1999 to December
31, 1999 0
------ ------ --------- ---------
Balance,
December 31, 1999 11,210 $1,121 $ 0 $ -1,121
====== ====== ========= =========
The accompanying notes are an integral part of these financial statements
F-5
<PAGE>
SOLAR ENTERPRISES, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
Mar. 1, Year Year Mar.12,1996
1999, to Ended Ended (inception)
Dec. 31, Feb. 28, Feb. 28, to Dec. 31,
1999 1999 1998 1999
-------- -------- -------- ----------
Cash,Flows from
Operating Activities
Net Loss $ 0 $ 0 $ 0 $ -1,121
Adjustment to
reconcile net loss
to net cash
provided by operating
activities 0 0 0 0
Changes in assets and
liabilities 0 0 0 0
------- ------- ------- ---------
Net cash used in
operating activities $ 0 $ 0 $ 0 $ -1,121
Cash Flows from
Investing activities 0 0 0 0
Cash Flows from
Financing Activities
Issuance of common
Stock 0 0 0 +1,121
------- ------- ------- ---------
Net increase (decrease)
in cash $ 0 $ 0 $ 0 $ 0
Cash, beginning of
period 0 0 0 0
------- ------- ------- ---------
Cash, end of period $ 0 $ 0 $ 0 $ 0
======= ======= ======= ========
The accompanying notes are an integral part of these financial statements
F-6
<PAGE>
SOLAR ENTERPRISES, INC.
(A Development Stage Company
NOTES TO FINANCIAL STATEMENTS
December 31, 1999, February 28, 1999, and February 28, 1998
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized March 12, 1996, under the laws of the State of Nevada,
as Solar Enterprises, Inc. The Company has no operations and in accordance with
SFAS #7, is considered a development stage company.
On March 12, 1996, 11,210 shares of no par value stock were issued for $1,121.00
NOTE 2 - ACCOUNTING POLICIES AND PROCEDURES
Accounting policies and procedures have not been determined except as follows:
1. The Company uses the accrual method of accounting.
2. Net earnings (loss) per share is calculated using the weighted average
number of shares of common stock outstanding.
3. The Company has not yet adopted any policy regarding payment of dividends.
No dividends have been paid since inception.
4. The Company has selected February 28 as its year end
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using the 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 has no current source of revenue. Without
realization of additional capital, it would be unlikely for the Company to
continue as a going concern. It is management's plan to seek additional capital
through a merger with an existing operating company.
NOTE 4 - WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional shares of
common stock.
F-7
<PAGE>
SOLAR ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS CONTINUED
December 31, 1999, February 28, 1999, and February 28 1998
NOTE 4 - RELATED PARTY TRANSACTION
The Company neither owns or leases any real property. Office services are
provided without charge by a director. 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.
F-8
<PAGE>
PART III
Item 1. Exhibit Index
Sequential
No. Page No.
--- ----------
(3) Articles of Incorporation and Bylaws
3.1.1 Articles of Incorporation 37
3.1.2 Amendment of Articles of Incorporation 42
3.2 Bylaws 45
(12) Lock-Up Agreement
12.1 Hagit Bernstein 57
12.2 Raphi Shram 58
12.3 Amnon Even 59
(23) Consents - Expert
23.1 Consent of Barry L. Friedman, P.C. 60
(27) Financial Data Schedule
27.1 Financial Data Schedule 61
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.
Date: January 19, 2000 SOLAR ENTERPRISES, INC.
By: /s/ Hagit Bernstein
-------------------
Hagit Bernstein
President
28.
EXHIBIT 3.1.1
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
MAR 12 1996
NO. 547496
DEAN HELLER
SECRETARY OF STATE
ARTICLES OF INCORPORATION
OF
SOLAR ENTERPRISES, INC.
a Nevada corporation
I, the undersigned, being the original incorporator herein named, for the
purpose of forming a corporation under the General Corporation Laws of the State
of Nevada, to do business both within and without the State of Nevada, do make
and file these Articles of Incorporation, hereby declaring and certifying that
the facts herein stated are true:
ARTICLE I
NAME
The name of the corporation is SOLAR ENTERPRISES, INC.
ARTICLE II
RESIDENT AGENT & REGISTERED OFFICE-
Section 2.01. Resident Agent. The name and address of the Resident Agent
for service of process is Nevada Corporate Headquarters, Inc., 5300 West Sahara,
Suite 101, Las Vegas, Nevada 89102. Mailing Address: P.O. Box 27740, Las Vegas,
NV 89126.
Section 2.02. Registered Office, The address of its Registered Office is
5300 West Sahara, Suite 101, Las Vegas, Nevada 89102.
Section 2.03. Other Offices. The Corporation may also maintain offices for
the transaction of any business at such other places within or without the State
of Nevada as it may from time to time determine. Corporate business of every
kind and nature may be conducted, and meetings of directors and stockholders
held outside the State of Nevada with the same effect as if in the State of
Nevada.
ARTICLE III
PURPOSE
The corporation is organized for the purpose of engaging in any lawful
activity, within or without the State of Nevada.
ARTICLE IV
SHARES OF STOCK
Section 4.01 Number and Class. The total number of shares of authorized
capital stock of the Corporation shall consist of a single class of twenty-five
thousand (25,000) shares of common stock, no par value.
The Common Stock may be issued from time to time without action by the
stockholders. The Common Stock may be issued for such consideration as may be
fixed from time to time by the Board of Directors.
<PAGE>
The Board of Directors may issue such shares of Common Stock in one or more
series, with such voting powers, designations, preferences and rights or
qualifications, limitations or restrictions thereof as shall be stated in the
resolution or resolutions adopted by them,
Section 4.02. No Preemptive Rights.. Holders of the Common Stock of the
corporation shall not have any preference, preemptive right, or right of
subscription to acquire any shares of the corporation authorized, issued or
sold, or to be authorized, issued or sold, and convertible into shares of the
Corporation, nor to any right of subscription thereto, other than to the extent,
if any, the Board of Directors may determine from time to time.
Section 4.03, Non-Assessability of Shares. The Common Stock of the
corporation, after the amount of the subscription price has been paid, in money,
property or services, as the directors shall determine, shall not be subject to
assessment to pay the debts of the corporation, nor for any other purpose, and
no stock issued as fully paid shall ever be assessable or assessed, and the
Articles of Incorporation shall not be amended in this particular.
ARTICLE V
DIRECTORS
Section 5.01. Governing- Board. The members of the Governing Board of the
Corporation shall be styled as directors.
Section 5.02. Initial Board of Directors. The initial Board of Directors
shall consist of one (1) member. The name and address of the initial member of
the Board of Directors is as follows:
NAME ADDRESS
Cort W. Christie P.O. Box 27740
Las Vegas, Nevada 89126
This individual shall serve as Director until the first annual meeting of the
stockholders or until his successor(s) shall have been elected and qualified.
Section 5.03. Change in Number of Directors. The number of directors may be
increased or decreased by a duly adopted amendment to the Bylaws of the
corporation.
ARTICLE VI
INCORPORATOR
The name and address of the incorporator is Nevada Corporate Headquarters,
Inc., P.O. Box 27740, Las Vegas, Nevada 89126,
ARTICLE VII
PERIOD OF DURATION
The corporation is to have a perpetual existence.
<PAGE>
ARTICLE VIII
DIRECTORS' AND OFFICERS' LIABILITY
A director or officer of the corporation shall not be personally liable to
this corporation or its stockholders for damages for breach of fiduciary duty as
a director or officer, but this Article shall not eliminate or limit the
liability of a director or officer for (i) acts or omissions which involve
intentional misconduct, fraud or a knowing violation of law or (H) the unlawful
payment of distributions. Any repeal or modification of this Article by 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.
ARTICLE IX
INDEMNITY
Every person who was or is a party to, or is threatened to be made a party
to, or is involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he, or a person of
whom he is the legal representative, is or was a director or officer of the
corporation, or is or was serving at the request of the corporation as a
director or officer of another corporation, or as its representative in a
partnership, joint venture, trust or other enterprise, shall be indemnified and
held harmless to the fullest extent legally permissible under the laws of the
State of Nevada from time to time against all expenses, liability and loss
(including attorneys fees, judgments, fines and amounts paid or to be paid in
settlement) reasonably incurred or suffered by him in connection therewith. Such
right of indemnification shall be a contract right which may be enforced in any
manner desired by such person. The expenses of officers and directors incurred
in defending a civil or criminal action, suit or proceeding must be paid by the
corporation as they are incurred and in advance of the final disposition of the
action, suit or proceeding, upon receipt of an undertaking by or on behalf of
the director or officer to repay the amount if it is ultimately determined by a
court of competent jurisdiction that he is not entitled to be indemnified by the
corporation. Such right of indemnification shall not be exclusive of any other
right which such directors, officers or representatives may have or hereafter
acquire, and, without limiting the generality of such statement, they shall be
entitled to their respective rights of indemnification under any by-law,
agreement, vote of stockholders, provision of law, or otherwise, as well as
their rights under this Article.
Without limiting the application of the foregoing, the stockholders or
Board of Directors may adopt by-laws from time to time with respect to
indemnification, to provide at all times the fullest indemnification permitted
by the laws of the State of Nevada, and may cause the corporation to purchase
and maintain insurance on behalf of any person who is or was a director or
officer of the corporation, or is or was serving at the request of the
corporation as director or officer of another corporation, or as its
representative in a partnership, joint venture, trust or other enterprises
against any liability asserted against such person and incurred in any such
capacity or arising out of such status, whether or not the corporation would
have the power to indemnify such person.
<PAGE>
The indemnification provided in this Article shall continue as to a person
who has ceased to be a director, officer, employee or agent, and shall inure to
the benefit of the heirs, executors and administrators of such person.
ARTICLE X
AMENDMENTS
Subject at all times to the express provisions of Section 4.03 which cannot
be amended, this corporation reserves the right to amend, alter, change, or
repeal any provision contained in these Articles of Incorporation or its Bylaws,
in the manner now or hereafter prescribed by statute or by these Articles of
Incorporation or said Bylaws, and all rights conferred upon the stockholders are
granted subject to this reservation.
ARTICLE XI
POWERS OF DIRECTORS
In furtherance and not in limitation of the powers conferred by statute the
Board of Directors is expressly authorized:
(1) Subject to the Bylaws, if any, adopted by the stockholders, to make,
alter or repeal the Bylaws of the corporation;
(2) To authorize and cause to be executed mortgages and liens, with or
without limit as to amount, upon the real and personal property of the
corporation;
(3) To authorize the guaranty by the corporation of securities, evidences
of indebtedness and obligations of other persons, corporations and
business entities;
(4) To set apart out of any of the funds of the corporation available for
distributions a reserve or reserves for any proper purpose and to
abolish any such reserve;
(5) By resolution, to designate one or more committees, each committee to
consist of at least one director of the corporation, which, to the
extent provided in the resolution or in the Bylaws of the corporation,
shall have and may exercise the powers of the Board of Directors in
the management of the business and affairs of the corporation, and may
authorize the seal of the corporation to be affixed to all papers
which may require it. Such committee or committees shall have such
name or names as may be stated in the Bylaws of the corporation or as
may be determined from time to time by resolution adopted by the Board
of Directors; and
(6) To authorize the corporation by its officers or agents to exercise all
such powers and to do all such acts and things as may be exercised or
done by the corporation, except and to the extent that any such
statute shall require action by the stockholders of the corporation
with regard to the exercising of any such power or the doing of any
such act or thing.
In addition to the powers and authorities hereinbefore or by statute
expressly conferred upon them, the Board of Directors may exercise all such
powers and do all such acts and things as may be exercised or done by the
corporation, except as otherwise provided herein and by law.
<PAGE>
IN WITNESS WHEREOF, I have hereunto set my hand this 5TH day of MARCH,
1996, hereby declaring and certifying that the facts stated hereinabove are
true.
/s/ Cort W. Christie
(For Nevada Corporate Headquarters, Inc.)
ACKNOWLEDGMENT
STATE OF NEVADA)
)SS.
COUNTY OF CLARK)
On this 5th day of March, 1996, personally appeared before me, a Notary
Public (or judge or other authorized person, as the case may be), CORT W.
CHRISTIE, personally known to me (or proved to me on the basis of satisfactory
evidence) to be the person whose name is subscribed to the within instrument and
acknowledged to me that he/she executed the same in his/her authorized capacity,
and that by his/her signature on the instrument the person, or the entity upon
behalf of which the person acted, executed the instrument.
(Notary Stamp) /s/ Stacey Chrisman
Notary Public in and for
Said County and State
I, NEVADA CORPORATE HEADQUARTERS, INC. hereby accept as Resident Agent for the
previously named Corporation.
March 5, 1996 ----------------------------
Office Administrator
EXHIBIT 3.1.2
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
(After Issuance of Stock)
Filed by:
SOLAR ENTERPRISES, INC.
We the undersigned HAGIT BERNSTEIN, President
HAGIT BERNSTEIN, Secretary of SOLAR ENTERPRISES, INC.
do hereby certify:
That the Board of Directors of said corporation at a meeting duly convened,
held on the 12th day of January, 2000, adopted a resolution to amend the
original articles as follows:
Article of Fourth is hereby amended to read as follows:
"FOURTH, The Aggregate number of shares which the corporation shall
have the authority to issue is Seventy-Five Million (75,000,000)
shares of common stock at $.001 par value, and Ten Million
(10,000,000) shares of Serial Preferred Stock at $.001 par value.
A. Each share of Common Stock shall entitle the holder thereof to
one vote on any matter submitted to a vote of or for consent of
holders of Common Stock. Subject to the provisions of applicable law
and this Article Fourth, any dividends paid or distributed on or with
respect to the Common Stock of the corporation shall be paid or
distributed ratably to the holders of its Common Stock. In the event
of any liquidation, dissolution or winding-up of the corporation,
whether voluntary or involuntary, after payment or provision for
payment of the debts and other liabilities of the corporation and any
amounts to which the holders of any Serial Preferred Stock shall be
entitled, as hereinafter provided, the holders of Common Stock shall
be entitled to share ratably in the remaining assets of the
corporation.
B. Subject to the terms and provisions of this Article Fourth,
the Board of Directors is authorized to provide from time to time for
the issuance of shares of Serial Preferred Stock in series and to fix
and determine from time to time before issuance the designation and
relative rights and preferences of the shares of each series of Serial
Preferred Stock and the restrictions or qualifications thereof,
including, without limiting the generality of the foregoing, the
following:
(1) The series designation and Authorized number of shares;
(2) The dividend rate and the date or dates on which such
dividends will be payable;
<PAGE>
(3) The amount or amounts to be received by the holders in the
event of voluntary or involuntary dissolution or liquidation of the
corporation;
(4) The price or prices at which shares may be redeemed, if any,
and any terms, conditions, limitations upon such redemptions;
(5) The sinking fund provisions, if any, for redemption or
purchase of shares; and
(6) The terms and conditions, if any, on which shares may be
converted at the election of the holders thereof into shares of other
capital stock, or of other series of Serial Preferred Stock, of the
corporation.
C. The holders of the shares of Common Stock or Serial Preferred Stock
shall not be entitled to cumulative voting on any matter.
D. Upon the amendment of this Article Fourth to read as hereinabove
set forth, each one (1) outstanding share of common stock is forward split,
reconstituted and converted into one hundred (100) shares of common stock.
No fractional shares shall be issued.
The number of shares of the corporation outstanding and entitled to vote on
an amendment to the Articles of Incorporation is 11,210; that the said change(s)
and amendment have been consented to and approved by a majority vote of the
stockholders holding at least a majority of each class stock outstanding and
entitled to vote thereon.
/s/ Hagit Bernstein
---------------------
President or Vice President
HAGIT BERNSTEIN
/s/ Hagit Bernstein
-----------------------
Secretary or Assistant Secretary
HAGIT BERNSTEIN
<PAGE>
State of CALIFORNIA
ss.
County of LOS ANGELES
On January 12, 2000, before me, Oscar A. Alvarado, personally appeared HAGIT
BERNSTEIN, proved to me on the basis of satisfactory evidence to be the person
whose name is subscribed to the within instrument and acknowledged to me that
she executed the same in her authorized capacity, and by his signature on the
instrument the person, or the entity upon which the person acted, executed the
instrument.
Witness my hand and official seal.
/s/ Oscar A. Alvarado (Notary Seal)
- -----------------------------
Notary Public in and for said County
And State
EXHIBIT 3.2
BYLAWS
OF
SOLAR ENTERPRISES, INC.
A Nevada Corporation
ARTICLE I
Stockholders
Section 1. Annual Meeting. Annual meetings of the stockholders, commencing with
the year 1996, shall be held on the 12th day of March each year if not a legal
holiday and, if a legal holiday, then on the next secular day following, or at
such other time as may be set by the Board of Directors from time to time, at
which the stockholders shall elect by vote a Board of Directors and transact
such other business as may properly be brought before the meeting.
Section 2. Special Meetings. Special meetings of the stockholders, for any
purpose or purposes, unless otherwise prescribed by statute or by the Articles
of Incorporation, may be called by the President or the Secretary by resolution
of the Board of Directors or at the request in writing of stockholders owning a
majority in amount of the entire capital stock of the corporation issued and
outstanding and entitled to vote. Such request shall state the purpose of the
proposed meeting.
Section 3. Place of Meetings. All annual meetings of the stockholders shall be
held at the registered office of the corporation or at such other place within
or without the State of Nevada as the directors shall determine. Special
meetings of the stockholders may be held at such time and place within or
without the State of Nevada as shall be stated in the notice of the meeting, or
in a duly executed waiver of notice thereof. Business transacted at any special
meeting of stockholders shall be limited to the purposes stated in the notice.
<PAGE>
Section 4. Quorum; Adjourned Meetings. The holders of a majority of the stock
issued and outstanding and entitled to vote thereat, present in person or
represented by proxy, shall constitute a quorum at all meetings of the
stockholders for the transaction of business except as otherwise provided by
statute or by the Articles of Incorporation. If, however, such quorum shall not
be present or represented at any meeting of the stockholders, the stockholders
entitled to vote thereat, present in person or represented by proxy, shall have
the power to adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present or represented. At
such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally notified.
Section 5. Voting. Each stockholder of record of the corporation holding stock
which is entitled to vote at this meeting shall be entitled at each meeting of
stockholders to one vote for each share of stock standing in his name on the
books of the corporation. Upon the demand of any stockholder, the vote for
directors and the vote upon any question before the meeting shall be by ballot.
When a quorum is present or represented at any meeting, the vote of the holders
of a majority of the stock having voting power present in person or represented
by proxy shall be sufficient to elect directors or to decide any question
brought before such meeting, unless the question is one upon which by express
provision of the statutes or of the Articles of Incorporation, a different vote
is required in which case such express provision shall govern and control the
decision of such question.
Section 6. Proxies. At any meeting of the stockholders any stockholder may be
represented and vote by a proxy or proxies appointed by an instrument in
writing. In the event that any such instrument in writing shall designate two or
more persons to act as proxies, a majority of such persons present at the
meeting, or, if only one shall be present, then that one shall have and may
exercise all of the powers conferred by such written instrument upon all of the
persons so designated unless the instrument shall otherwise provide. No proxy or
power of attorney to vote shall be used to vote at a meeting of the stockholders
unless it shall have been filed with the secretary of the meeting. All questions
regarding the qualification of voters, the validity of proxies and the
acceptance or rejection of votes shall be decided by the inspectors of election
who shall be appointed by the Board of Directors, or if not so appointed, then
by the presiding officer of the meeting.
Section 7. Action Without Meeting. Any action which may be taken by the vote of
the stockholders at a meeting may be taken without a meeting if authorized by
the written consent of stockholders holding at least a majority of the voting
power, unless the provisions of the statutes or of the Articles of Incorporation
require a greater proportion of voting power to authorize such action in which
case such greater proportion of written consents shall be required.
<PAGE>
ARTICLES II
Directors
Section 1. Management of Corporation. The business of the corporation shall be
managed by its Board of Directors which may exercise all such powers of the
corporation and do all such lawful acts and things as are not by statute or by
the Articles of Incorporation or by these Bylaws directed or required to be
exercised or done by the stockholders.
Section 2. Number, Tenure and Qualifications. The number of directors which
shall constitute the whole board shall be at least one. The number of directors
may from time to time be increased or decreased to not less than one nor more
than fifteen. The directors shall be elected at the annual meeting of the
stockholders and except as provided in Section 2 of this Article, each director
elected shall hold office until his successor is elected and qualified.
Directors need not be stockholders.
Section 3. Vacancies. Vacancies in the Board of Directors including those caused
by an increase in the number of directors, may be filled by a majority of the
remaining directors, though less than a quorum, or by a sole remaining director,
and each director so elected shall -hold office until his successor is elected
at an annual or a special meeting of the stockholders. The holders of two-thirds
of the outstanding shares of stock entitled to vote may at any time peremptorily
terminate the term of office of all or any of the directors by vote at a meeting
called for such purpose or by a written statement filed with the secretary or,
in his absence, with any other officer. Such removal shall be effective
immediately, even if successors are not elected simultaneously.
A vacancy or vacancies in the Board of Directors shall be deemed to exist
in case of the death, resignation or removal of any directors, or if the
authorized number of directors be increased, or if the stockholders fail at any
annual or special meeting of stockholders at which any director or directors are
elected to elect the full authorized number of directors to be voted for at that
meeting.
If the Board of Directors accepts the resignation of a director tendered to
take effect at a future time, the Board or the stockholders shall have power to
elect a successor to take office when the resignation is to become effective.
No reduction of the authorized number of directors shall have the effect of
removing any director prior to the expiration of his term of office.
<PAGE>
Section 4. Annual and Regular Meetings. Regular meetings of the Board of
Directors shall be held at any place within or without the State which has been
designated from time to time by resolution of the Board or by written consent of
all members of the Board. In the absence of such designation regular meetings
shall be held at the registered office of the corporation. Special meetings of
the Board may be held either at a place so designated or at the registered
office.
Regular meetings of the Board of Directors may be held without call or notice at
such time and at such place as shall from time to time be fixed and determined
by the Board of Directors.
Section 5. First Meeting. The first meeting of each newly elected Board of
Directors shall be held immediately following the adjournment of the meeting of
stockholders and at the place thereof. No notice of such meeting shall be
necessary to the directors in order legally to constitute the meeting, provided
a quorum be present. In the event such meeting is not so held, the meeting may
be held at such time and place as shall be specified in a notice given as
hereinafter provided for special meetings of the Board of Directors.
Section 6. Special Meetings. Special meetings of the Board of Directors may be
called by the Chairman or the President or by any Vice-President or by any two
directors.
Written notice of the time and place of special meetings shall be delivered
personally to each director, or sent to each director by mail or by other form
of written communication, charges prepaid, addressed to him at his address as it
is shown upon the records or if such address is not readily ascertainable, at
the place in which the meetings of the directors are regularly held. In case
such notice is mailed or telegraphed, it shall be deposited in the United States
mail or delivered to the telegraph company at least three (3) days prior to the
time of the holding of the meeting. In case such notice is hand delivered as
above provided, it shall be so delivered at least twenty-four (24) hours prior
to the time of the holding of the meeting. Such mailing, telegraphing or
delivery as above provided shall be due, legal and personal notice to such
director.
Section 7. Business of Meetings. The transactions of any meeting of the Board of
Directors, however called and noticed or wherever held, shall be as valid as
though had at a meeting duly held after regular call and notice, if a quorum be
present, and if, either before or after the meeting, each of the directors not
present signs a written waiver of notice, or a consent to holding such meeting,
or an approval of the minutes thereof. All such waivers, consents or approvals
shall be filed with the corporate records or made a part of the minutes of the
meeting.
<PAGE>
Section 8. Quorum; Adjourned Meetings. A majority of the authorized number of
directors shall be necessary to constitute a quorum for the transaction of
business, except to adjourn as hereinafter provided. Every act or decision done
or made by a majority of the directors present at a meeting duly held at which a
quorum is present shall be regarded as the act of the Board of Directors, unless
a greater number be required by law or by the Articles of Incorporation. Any
action of a majority, although not at a regularly called meeting, and the record
thereof, if assented to in writing by all of the other members of the Board
shall be as valid and effective in all respects as if passed by the Board in
regular meeting.
A quorum of the directors may adjourn any directors meeting to meet again
at a stated day and hour; provided, however, that in the absence of a quorum, a
majority of the directors present at any directors meeting, either regular or
special, may adjourn from time to time until the time fixed for the next regular
meeting of the Board.
Notice of the time and place of holding an adjourned meeting need not be
given to the absent directors if the time and place be fixed at the meeting
adjourned.
Section 9. Committees. The Board of Directors may, by resolution adopted by a
majority of the whole Board, designate one or more committees of the Board of
Directors, each committee to consist of at least one or more of the directors of
the corporation which, to the extent provided in the resolution, shall have and
may exercise the power of the Board of Directors in the management of the
business and affairs of the corporation and may have power to authorize the seal
of the corporation to be affixed to all papers which may require it. Such
committee or committees shall have such name or names as may be determined from
time to time by the Board of Directors. The members of any such committee
present at any meeting and not disqualified from voting may, whether or not they
constitute a quorum, unanimously appoint another member of the Board of
Directors to act at the meeting in the place of any absent or disqualified
member. At meetings of such committees, a majority of the members or alternate
members shall constitute a quorum for the transaction of business, and the act
of a majority of the members or alternate members at any meeting at which there
is a quorum shall be the act of the committee.
The committees shall keep regular minutes of their proceedings and report
the same to the Board of Directors.
Section 10. Action Without Meeting. Any action required or permitted to be taken
at any meeting of the Board of Directors or of any committee thereof may be
taken without a meeting if a written consent thereto is signed by all members of
the Board of Directors or of such committee, as the case may be, and such
written consent is filed with the minutes of proceedings of the Board or
committee.
<PAGE>
Section 11. Special Compensation. The directors may be paid their expenses of
attendance at each meeting of the Board of Directors and may be paid a fixed gum
for attendance at each meeting of the Board of Directors or a stated salary as
director. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor. Members
of special or standing committees may be allowed like reimbursement and
compensation for attending committee meetings.
ARTICLE III
Notices
Section 1. Notice of Meetings. Notices of meetings shall be in writing and
signed by the President or a Vice-President or the Secretary or an Assistant
Secretary or by such other person or persons as the directors shall designate.
Such notice shall state the purpose or purposes for which the meeting is called
and the time and the place, which may be within or without this State, where it
is to be held. A copy of such notice shall be either delivered personally to or
shall be mailed, postage prepaid, to each stockholder of record entitled to vote
at such meeting not less than ten (10) nor more than sixty (60) days before such
meeting. If mailed, it shall be directed to a stockholder at his address as it
appears upon the records of the corporation and upon such mailing of any such
notice, the service thereof shall be complete and the time of the notice shall
begin to run from the date upon which such notice is deposited in the mail for
transmission to such stockholder. Personal delivery of any such notice to any
officer of a corporation or association, or to any member of a partnership shall
constitute delivery of such notice to such corporation, association or
partnership. In the event of the transfer of stock after delivery of such notice
of and prior to the holding of the meeting it shall not be necessary to deliver
or mail notice of the meeting to the transferee.
Section 2. Effect of Irregularly Called Meetings. Whenever all parties entitled
to vote at any meeting, whether of directors or stockholders, consent, either by
a writing on the records of the meeting or filed with the secretary, or by
presence at such meeting and oral consent entered on the minutes, or by taking
part in the deliberations at such meeting without objection, the doings of such
meeting shall be as valid as if had at a meeting regularly called and noticed,
and at such meeting any business may be transacted which is not excepted from
the written consent or to the consideration of which no objection for want of
notice is made at the time, and if any meeting be irregular for want of notice
or of such consent, provided a quorum was present at such meeting, the
proceedings of said meeting may be ratified and approved and rendered likewise
valid and the irregularity or defect therein waived by a writing signed by all
parties having the right to vote at such meeting; and such consent or approval
of stockholders may be by proxy or attorney, but all such proxies and powers of
attorney must be in writing.
<PAGE>
Section 3. Waiver of Notice. Whenever any notice whatever is required to be
given under the provisions of the statutes, of the Articles of Incorporation or
of these Bylaws, a waiver thereof in writing, signed by the person or persons
entitled to said notice, whether before or after the time stated therein, shall
be deemed equivalent thereto.
ARTICLE IV
Officers
Section 1. Election. The officers of the corporation shall be chosen by the
Board of Directors and shall be a President, a Secretary and a Treasurer, none
of whom need be directors. Any person may hold two or more offices. The Board of
Directors may appoint a Chairman of the Board, Vice-Chairman of the Board, one
or more vice presidents, assistant treasurers and assistant secretaries.
Section 2. Chairman of the Board. The Chairman of the Board shall preside at
meetings of the stockholders and the Board of Directors, and shall see that all
orders and resolutions of the Board of Directors are carried into effect.
Section 3. Vice-Chairman of the Board. The Vice-Chairman shall, in the absence
or disability of the Chairman of the Board, perform the duties and exercise the
powers of the Chairman of the Board and shall perform such other duties as the
Board of Directors may from time to time prescribe.
Section 4. President. The President shall be the chief executive officer of the
corporation and shall have active management of the business of the corporation.
He shall execute on behalf of the corporation all instruments requiring such
execution except to the extent the signing and execution thereof shall be
expressly designated by the Board of Directors to some other officer or agent of
the corporation.
Section 5. Vice-President. The Vice-President shall act under the direction of
the President and in the absence or disability of the President shall perform
the duties and exercise the powers of the President. They shall perform such
other duties and have such other powers as the President or the Board of
Directors may from time to time prescribe. The Board of Directors may designate
one or more Executive Vice-Presidents or may otherwise specify the order of
seniority of the Vice-Presidents. The duties and powers of the President shall
descend to the Vice-Presidents in such specified order of seniority.
<PAGE>
Section 6. Secretary. The Secretary shall act under the direction of the
President. Subject to the direction of the President he shall attend all
meetings of the Board of Directors and all meetings of the stockholders and
record the proceedings. He shall perform like duties for the standing committees
when required. He shall give, or cause to be given, notice of all meetings of
the stockholders and special meetings of the Board of Directors, and shall
perform such other duties as may be prescribed by the President or the Board of
Directors.
Section 7. Assistant Secretaries. The Assistant Secretaries shall act under the
direction of the President. In order of their seniority, unless otherwise
determined by the President or the Board of Directors, they shall, in the
absence or disability of the Secretary, perform the duties and exercise the
powers of the Secretary. They shall perform such other duties and have such
other powers as the President or the Board of Directors may from time to time
prescribe.
Section 8. Treasurer. The Treasurer shall act under the direction of the
President. Subject to the direction of the President he shall have custody of
the corporate funds and securities and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the corporation and shall
deposit all monies and other valuable effects in the name and to the credit of
the corporation in such depositories as may be designated by the Board of
Directors. He shall disburse the funds of the corporation as may be ordered by
the President or the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the President and the Board of Directors, at
its regular meetings, or when the Board of Directors so requires, an account of
all his transactions as Treasurer and of the financial condition of the
corporation.
If required by the Board of Directors, he shall give the corporation a bond
in such sum and with such surety or sureties as shall be satisfactory to the
Board of Directors for the faithful performance of the duties of his office and
for the restoration to the corporation, in case of his death, resignation,
retirement or removal from office, of all books, papers, vouchers, money and
other property of whatever kind in his possession or under his control belonging
to the corporation.
Section 9. Assistant Treasurers. The Assistant Treasurers in the order of their
seniority, unless otherwise determined by the President or the Board of
Directors, shall, in the absence or disability of the Treasurer, perform the
duties and exercise the powers of the Treasurer. They shall perform such other
duties and have such other powers as the President or the Board of Directors may
from time to time prescribe.
Section 10. Compensation. The salaries and compensation of all officers of the
corporation shall be fixed by the Board of Directors.
<PAGE>
Section 11. Removal; Resignation. The officers of the corporation shall hold
office at the pleasure of the Board of Directors. Any officer elected or
appointed by the Board of Directors may be removed at any time by the Board of
Directors. Any vacancy occurring in any office of the corporation by death,
resignation, removal or otherwise shall be filled by the Board of Directors.
ARTICLE V
Capital Stock
Section 1. Certificates. Every stockholder shall be entitled to have a
certificate signed by the President or a Vice-President and the Treasurer or an
Assistant Treasurer, or the Secretary or an Assistant Secretary of the
corporation, certifying the number of shares owned by him in the corporation. If
the corporation shall be authorized to issue more than one class of stock or
more than one series of any class, the designations, preferences and relative,
participating, optional or other special rights of the various classes of stock
or series thereof and the qualifications, limitations or restrictions of such
rights, shall be set forth in full or summarized on the face or back of the
certificate, which the corporation shall issue to represent such stock.
If a certificate is signed (1) by a transfer agent other than the corporation or
its employees or (2) by a registrar other than the corporation or its employees,
the signatures of the officers of the corporation may be facsimiles. In case any
officer who has signed or whose facsimile signature has been placed upon a
certificate shall cease to be such officer before such certificate is issued,
such certificate may be issued with the same effect as though the person had not
ceased to be such officer. The seal of the corporation, or a facsimile thereof,
may, but need not be, affixed to certificates of stock.
Section 2. Surrendered; Lost or Destroyed Certificates. The Board of Directors
may direct a new certificate or certificates to be issued in place of any
certificate or certificates theretofore issued by the corporation alleged to
have been lost or destroyed upon the making of an affidavit of that fact by the
person claiming the certificate of stock to be lost or destroyed. When
authorizing such issue of a new certificate or certificates, the Board of
Directors may, in its discretion and as a condition precedent to the issuance
thereof, require the owner of such lost or destroyed certificate or
certificates, or his legal representative, to advertise the same in such manner
as it shall require and/or give the corporation a bond in such sum as it may
direct as indemnity against any claim that may be made against the corporation
with respect to the certificate alleged to have been lost or destroyed.
<PAGE>
Section 3. Replacement Certificates. Upon surrender to the corporation or the
transfer agent of the corporation of a certificate for shares duly endorsed or
accompanied by proper evidence of succession, assignment or authority to
transfer, it shall be the duty of the corporation, if it is satisfied that all
provisions of the laws and regulations applicable to the corporation regarding
transfer and ownership of shares have been complied with, to issue a new
certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its books.
Section 4. Record Date. The Board of Directors may fix in advance a date not
exceeding sixty (60) days nor less than ten (10) days preceding the date of any
meeting of stockholders, or the date for the payment of any distribution, or the
date for the allotment of rights, or the date when any change or conversion or
exchange of capital stock shall go into effect, or a date in connection with
obtaining the consent of stockholders for any purpose, as a record date for the
determination of the stockholders entitled to notice of and to vote at any such
meeting, and any adjournment thereof, or entitled to receive payment of any such
distribution, or to give such consent, and in such case, such stockholders, and
only such stockholders as shall be stockholders of record on the date so fixed,
shall be entitled to notice of and to vote at such meeting, or any adjournment
thereof, or to receive payment of such distribution, or to receive such
allotment of rights, or to exercise such rights, or to give such consent, as the
case may be, notwithstanding any transfer of any stock on the books of the
corporation after any such record date fixed as aforesaid.
Section 5. Registered Owner. The corporation shall be entitled to recognize the
person registered on its books as the owner of shares to be the exclusive owner
for all purposes including voting and distribution, and the corporation shall
not be bound to recognize any equitable or other claim to or interest in such
share or shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise provided by the laws of
Nevada.
ARTICLE VI
General Provisions
Section 1. Registered Office, The registered office of this corporation shall be
in the County of Clark, State of Nevada.
The corporation may also have offices at such other places both within and
without the State of Nevada as the Board of Directors may from time to time
determine or the business of the corporation may require.
<PAGE>
Section 2. Distributions. Distributions upon the capital stock of the
corporation, subject to the provisions of the Articles of Incorporation, if any,
may be declared by the Board of Directors at any regular or special meeting,
pursuant to law. Distributions may be paid in cash, in property or in shares of
the capital stock, subject to the provisions of the Articles of Incorporation.
Section 3. Reserves. Before payment of any distribution, there may be set aside
out of any funds of the corporation available for distributions such sum or sums
as the directors from time to time, in their absolute discretion, think proper
as a reserve or reserves to meet contingencies, or for equalizing distributions
or for repairing or maintaining any property of the corporation or for such
other purpose as the directors shall think conducive to the interest of the
corporation, and the directors may modify or abolish any such reserve in the
manner in which it was created.
Section 4. Checks; Notes. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers or such other person or
persons as the Board of Directors may from time to time designate.
Section 5. Fiscal Year. The fiscal year of the corporation shall be fixed by
resolution of the Board of Directors.
Section 6. Corporate Seal. The corporation may or may not have a corporate seal,
as may from time to time be determined by resolution of the Board of Directors.
If a corporate seal is adopted, it shall have inscribed thereon the name of the
corporation and the words "Corporate Seal" and "Nevada". The seal may be used by
causing it or a facsimile thereof to be impressed or affixed or in any manner
reproduced.
ARTICLE VII
Indemnification
Section 1. Indemnification of Officers and Directors, Employees and Other
Persons. Every person who was or is a party or is threatened to be made a party
to or is involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he or a person of
whom he is the legal representative is or was a director or officer of the
corporation or is or was serving at the request of the corporation or for its
benefit as a director or officer of another corporation, or as its
representative in a partnership, joint venture, trust or other enterprise, shall
be indemnified and held harmless to the fullest extent legally permissible under
the general corporation law of the State of Nevada from time to time against all
expenses, liability and loss (including attorneys' fees, judgments, fines and
amounts paid or to be paid in settlement) reasonably incurred or suffered by him
in connection therewith. The expenses of officers and directors incurred in
defending a civil or criminal action, suit or proceeding must be paid by the
corporation as they are incurred and in advance of the final disposition of the
action, suit or proceeding upon receipt of an undertaking by or on behalf of the
director or officer to
<PAGE>
repay the amount if it is ultimately determined by a court of competent
jurisdiction that he is not entitled to be indemnified by the corporation. Such
right of indemnification shall be a contract right which may be enforced in any
manner desired by such person. Such right of indemnification shall not be
exclusive of any other right which such directors, officers or representatives
may have or hereafter acquire and, without limiting the generality of such
statement, they shall be entitled to their respective rights of indemnification
under any bylaw, agreement, vote of stockholders, provision of law or otherwise,
as well as their rights under this Article.
Section 2. Insurance. The Board of Directors may cause the corporation to
purchase and maintain insurance on behalf of any person who is or was a director
or officer of the corporation, or is or was serving at the request of the
corporation as a director or officer of another corporation, or as its
representative in a partnership, joint venture, trust or other enterprise
against any liability asserted against such person and incurred in any such
capacity or arising out of such status, whether or not the corporation would
have the power to indemnify such person.
Section 3. Further Bylaws. The Board of Directors may from time to time adopt
further Bylaws with respect to indemnification and may amend these and such
Bylaws to provide at all times the fullest indemnification permitted by the
General Corporation Law of the State of Nevada.
ARTICLE VIII
Amendments
Section 2. Amendments by Board of Directors. The Board of Directors by a
majority vote of the whole Board at any meeting may amend these Bylaws,
including Bylaws adopted by the stockholders, but the stockholders may from time
to time specify particular provisions of the Bylaws which shall not be amended
by the Board of Directors.
EXHIBIT 12.1
January 3, 2000
Solar Enterprises, Inc.
16133 Ventura Boulevard, Suite 635
Encino, California 91436
Re Solar Enterprises, Inc
Gentlemen:
The undersigned is the record owner of 320,000 shares of the common stock of
Solar Enterprises, Inc., par value $.001 per share (the "Shares), such Shares
are eligible for sale under Rule 144 promulgated under the Securities Act of
1933, as amended, subject to certain limitations included in said Rule.
The undersigned, together with Raphi Shram and Amnon Even, and each of them,
agree as follows:
1. The undersigned will not sell, contract to sell, or make any other
disposition of, or grant any purchase option for the sale of, any of
the shares of the common stock owned by the undersigned, directly or
indirectly, until such time as the Company has entered into a merger
or acquisition or the Company is no longer classified as a "blank
check" company, as that term is defined in the Form 10SB 12G on file
with the Securities and Exchange Commission, whichever first occurs.
2. The undersigned acknowledges that Pacific Stock Transfer Company, 5855
S. Pecos Road, Suite D, Las Vegas, Nevada 89120, the transfer agent
for the Company, has been advised of the restrictions described herein
and that any attempts by the undersigned to violate said restriction
may result in legal action(s) by the Company. The undersigned further
agrees, upon the request of the Company, that in addition to any other
restrictions reflecting that the Shares have not been registered under
the Securities Act of 1933, as amended, may be placed on individual
certificates issued.
Very truly yours,
/s/ HAGIT BERNSTEIN
HAGIT BERNSTEIN
Solar Enterprises, Inc. Board Director
cc: Pacific Stock Transfer Company
EXHIBIT 12.2
January 3, 2000
Solar Enterprises, Inc.
16133 Ventura Boulevard, Suite 635
Encino, California 91436
Re: Solar Enterprises, Inc
Gentlemen:
The undersigned is the record owner of 320,000 shares of the common stock of
Solar Enterprises, Inc., par value $.001 per share (the "Shares), such Shares
are eligible for sale under Rule 144 promulgated under the Securities Act of
1933, as amended, subject to certain limitations included in said Rule.
The undersigned, together with Hagit Bernstein and Amnon Even, and each of them,
agree as follows:
1. The undersigned will not sell, contract to sell, or make any other
disposition of, or grant any purchase option for the sale of, any of
the shares of the common stock owned by the undersigned, directly or
indirectly, until such time as the Company has entered into a merger
or acquisition or the Company is no longer classified as a "blank
check" company, as that term is defined in the Form 10SB 12G on file
with the Securities and Exchange Commission, whichever first occurs.
2. The undersigned acknowledges that Pacific Stock Transfer Company, 5855
S. Pecos Road, Suite D, Las Vegas, Nevada 89120, the transfer agent
for the Company, has been advised of the restrictions described herein
and that any attempts by the undersigned to violate said restriction
may result in legal action(s) by the Company. The undersigned further
agrees, upon the request of the Company, that in addition to any other
restrictions reflecting that the Shares have not been registered under
the Securities Act of 1933, as amended, may be placed on individual
certificates issued.
Very truly yours,
/s/ RAPHI SHRAM
RAPHI SHRAM
Solar Enterprises, Inc. Board Director
cc: Pacific Stock Transfer Company
EXHIBIT 12.3
January 3, 2000
Solar Enterprises, Inc.
16133 Ventura Boulevard, Suite 635
Encino, California 91436
Re: Solar Enterprises, Inc
Gentlemen
The undersigned is the record owner of 240,000 shares of the common stock of
Solar Enterprises, Inc., par value $.001 per share (the "Shares), such Shares
are eligible for sale under Rule 144 promulgated under the Securities Act of
1933, as amended, subject to certain limitations included in said Rule.
The undersigned, together with Hagit Bernstein and Raphi Shram, and each of
them, agree as follows:
1. The undersigned will not sell, contract to sell, or make any other
disposition of, or grant any purchase option for the sale of, any of
the shares of the common stock owned by the undersigned, directly or
indirectly, until such time as the Company has entered into a merger
or acquisition or the Company is no longer classified as a "blank
check" company, as that term is defined in the Form 10SB12G on file
with the Securities and Exchange Commission, whichever first occurs.
2. The undersigned acknowledges that Pacific Stock Transfer Company, 5855
S. Pecos Road, Suite D, Las Vegas, Nevada 89120, the transfer agent
for the Company, has been advised of the restrictions described herein
and that any attempts by the undersigned to violate said restriction
may result in legal action(s) by the Company. The undersigned further
agrees, upon the request of the Company, that in addition to any other
restrictions reflecting that the Shares have not been registered under
the Securities Act of 1933, as amended, may be placed on individual
certificates issued.
Very truly yours,
/s/ AMNON EVEN
AMNON EVEN
Solar Enterprises, Inc. Board Director
cc: Pacific Stock Transfer Company
EXHIBIT 23.1
[Barry L. Friedman, P.C. letterhead]
January 13, 2000
To Whom It May Concern:
The firm of Barry L. Friedman, P.C., Certified Public Accountant consents to the
inclusion of their report of January 13, 2000, on the Financial Statements of
Solar Enterprises, Inc., as of December 31, 1999, in any filings that are
necessary now or in the near future with the U.S. Securities and Exchange
Commission.
Very truly yours,
BARRY L. FRIEDMAN
Barry L. Friedman
Certified Public Accountant
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