<PAGE>
FORM 10-KSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31,1997
Commission File number 0-13597
ASDAR INC
-----------------------------------------------------
(Exact name of Registrant as specified in its charter)
Nevada 88-0195105
- ------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
2124 Glasgow Avenue 92007
- --------------------- ----------
(Registrant's Address) (Zip Code)
Registrant's telephone number, including area code: (619) 792-7300
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.001 par value
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the Securities
Exchange Act of 1934 during the preceding 12 months, and (2) has been
subject to such filing requirements for the past 90 days. Yes No X
----- -----
As of March 31, 1998 (the required filing date of the report),
although the Registrant's Common stock was quoted on the NASDAQ ("Bulletin
Board"), the common stock was not subject of any meaningful trading in the
over-the-counter market. Accordingly, the Registrant does not believe
there is a determinable market value for its outstanding shares of Common
Stock as of such date. The number of shares outstanding of the
Registrant's $.001 par value Common Stock as of March 31, 1998 was
1,734,499.
Documents incorporated by reference: None
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the Registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this
Form 10-KSB or any amendment to this Form 10-KSB. Yes X No
----- -----
</Page>
<PAGE>
PART I
-------
THIS REPORT ON FORM 10-KSB IS FOR THE FISCAL YEAR ENDED DECEMBER 31,
1997, HOWEVER, THE REPORT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION IN APRIL 2000. TO THE EXTENT PRACTICABLE, THE DISCLOSURE
CONTAINED HEREIN HAS BEEN PREPARED TO SPEAK AS OF MARCH 31, 1998, THE
REQUIRED FILING DATE OF THIS REPORT.
Item 1. Business
- -----------------
(a) General Development of the Business.
ASDAR INC (the "Company") was formed under the laws of the State of
Nevada on November 29, 1983 under the name Venture Group, Inc. In April
1985, the Company conducted an initial public offering of its securities
pursuant to a Registration Statement on Form S-18.
In 1987, the Company announced its Registration Distribution Program
("RDP"). The RDP was designed to assist privately-owned companies in
becoming publicly held. In exchange for financial consulting and other
services, the Company's RDP clients issued to the Company shares of common
stock and common stock purchase warrants, some or all of which were to be
subsequently registered by the client with the Securities and Exchange
Commission ("SEC") in order to facilitate the public distribution of those
securities by the Company to its shareholders. Subsequently, the client
would attempt to raise equity capital from the exercise of the common stock
warrants.
In 1988, the SEC and the National Association of Securities Dealers,
Inc., ("NASD") reviewed the RDP and insisted on certain changes to the
program which reduced the overall benefits and incentives to the Company.
As a result of the SEC and NASD review, the Company determined it was
impracticable to continue the RDP and discontinued all efforts in its
business venture in 1990.
From 1990 to the filing of this report in April 2000, the Company has
conducted no business operations other than the pursuit of a merger, or
reverse acquisition with an active business operation interested in
restructuring itself as a publicly-held company and the define and
litigation of certain federal and state actions.
(b) Financial Information About Industry Segments
Inapplicable
(c) Narrative Description of Business.
See Item 1(a) above. Since 1990, the Company has had no employees
other than the members of management identified in Part III, Item 10 of
this report.
(d) Financial Information About Foreign and Domestic Operations and
Export Sales.
Inapplicable
</Page>
<PAGE>
Item 2. Properties
- -------------------
The Company's offices are currently located in the residence of its
Secretary. The Company's Secretary does not charge the Company any rent or
overhead for its use of his residence or utilities.
Item 3. Legal Proceedings
- --------------------------
In 1995, the Plaintiffs in a securities class action lawsuit obtained
a judgement against the Company in the amount of $2,500,000. In June,
1996, the Company's Secretary negotiated a Settlement whereby the
Plaintiffs released the Company in Consideration of the payment of $150,000
to the class and the issuance of 50,000 (post 1 for 100 reverse split
stock) to the Plaintiffs. In August, 1996, this transaction was approved
by the San Diego Superior Court, Judge Terry O'Rourke presiding, and was
finalized in March of 1997. As a result of this settlement the Company no
longer has a judgement against it.
In January, 1997, a shareholder of the Company filed a lawsuit against
the Registrant which was never served. The shareholder, however, attempted
to obtain a Default Judgement. The Default was granted but subsequently
reversed when the Registrant received notice of the Judgement and had it
set aside. In November, 1997, Registrant answered the complaint and filed
a counter claim neither of which, to date, have been responded to. The
Registrant intends to vigorously pursue this action.
Item 4. Submission of Matters to a vote of Securities Holders.
- ---------------------------------------------------------------
Inapplicable
PART II
--------
Item 5. Market for the Company's Common Equity and Related Stockholder
Matters.
- ------------------------------------------------------------------------
(a) Market Information.
Management of the Company believes that its Common Stock has not been
traded in any meaningful amount from, at least, 1990 to the date of this
report.
(b) Holders.
The approximate number of holders of the outstanding shares of the
Company's common stock as of December 31, 1997 is 1,500.
(c) Dividends.
The Company has never declared or paid any dividends on its common
stock. The Company does not intend to declare or pay any dividends in the
foreseeable future.
Item 6. Selected Financial Data.
- ---------------------------------
Inapplicable. See Item 8 - Financial Statements and Supplementary
Data.
</Page>
<PAGE>
Item 7. Management's Discussion and Analysis of Financial Condition and
Result of Operations
- --------------------------------------------------------------------------
The Company was formed under the laws of the State of Nevada on
November 29, 1983, under the name Venture Group, Inc. In April, 1985, the
Company conducted an initial public offering of its securities pursuant to
a Registrant Statement on Form S-18.
In 1987, the Company announced its Registration Distribution Program
("RDP"). The RDP was designed to assist privately owned companies in
becoming publicly held. In exchange for financial consulting and other
services, the Company's RDP clients issued to the Company shares of common
stock and common stock purchase warrants, some or all of which were to be
subsequently registered by the client with the Securities and Exchange
Commission ("SEC") in order to facilitate the public distribution of those
securities by the Company to its shareholders. Subsequently, the client
would attempt to raise equity capital from the exercise of the common stock
purchase warrants.
In 1988, the SEC and the National Association of Securities Dealers,
Inc., ("NASD") reviewed the RDP and insisted on certain changes to the
program which reduced the overall benefits and incentives to the Company.
As a result of the SEC and NASD review, the Company determined it was
impracticable to continue the RDP and discontinued all efforts in its
business venture in 1990.
From 1990 to the filing of this report in April 2000, the Company has
conducted no business operations other than the pursuit of a merger or
reverse acquisition with an active business operation interested in
restructuring itself as a publicly-held company. In 1992, the Company
attempted to acquire the assets and operations of Royal Hill Resources
Corporation ("Royal Hill"). This acquisition failed when management of the
Registrant learned that Royal Hills had improperly accounted for its
assets. In the last half of 1992, the Company attempted to acquire certain
theme restaurants in Las Vegas, Nevada. These acquisitions never reached
fruition and were abandoned in January, 1995. On May 13, 1996, the
Company entered into an agreement with James A. Egide (the "Egide
Agreement") by which Mr. Egide agreed to advance $1,000,000 to the Company
to settle its class action lawsuit (referenced in Item 3 of this report)
and to initiate acquisition of a software license from Casino World
Holdings, Ltd. The Egide Agreement further required Mr. Egide to raise an
additional $4,000,000 to develop and operate an online casino operation.
After executing the Egide Agreement, the Company on May 13, 1996, entered
into an agreement with Casino World Holdings, Ltd., to purchase this
license by which the Company agreed to pay cash and issue stock to Casino
World Holdings, Ltd., in consideration for the license. The acquisition
failed due to adverse publicity and several questions concerning the
viability of the software and value of the license.
On January 25, 1997, the Company reached a settlement with James A.
Egide and Casino World Holdings, Ltd., by which the Company issued 500,000
share of its common stock to persons and issued a note in the amount of
$50,000 to James A. Egide. In addition, certain agreements were made
between Mr. Egide and Casino World Holdings, Ltd. Contemporaneously, each
of the parties issued full general releases to each other. A detailed copy
of the Settlement Agreement appears as Exhibit 10.9 of this filing.
</Page>
<PAGE>
Item 9. Changes in and Disagreements with Accountant's on Accounting and
Financial Disclosure
- --------------------------------------------------------------------------
Inapplicable
Item 10. Directors and Executive Officers of the Registrant.
- -------------------------------------------------------------
(a) (b) Identification of Directors and Executive Officers.
The officers and directors of the Company are as follows;
NAME AGE POSITION
Stephen J. Nemergut 49 President, Director
Nicholas F. Coscia 45 Secretary, Director
George J. Coleman 75 Director
All directors of the Company hold office until the next annual meeting
of until their successors have been elected and qualified. All officers
serve at the discretion of the Board of Directors.
(c) Identification of Certain Significant Employees.
Mr. Nemergut and Mr. Coscia are significant employees of the Company.
(d) Family Relationships.
Inapplicable
(e) Business Experience
Mr. Nemergut has served as President since June, 1996. Mr Nemergut
has had various executive positions, including president and Chairman of
the Board with several public companies since 1979.
Mr. Coscia has served as Secretary since 1989. Mr. Coscia is a
licensed attorney practicing in the San Diego, California area.
(f) Involvement in Certain Legal Proceedings.
(g) Promoter and Control Persons.
Mr. Coscia and Mr. Nemergut are control persons in that they are both
officers and director of the Company.
(h) Compliance with Section 16(a) of the Exchange Act.
During the fiscal year ended December 31, 1997, there were no Forms
3,4, and 5 filed with the Securities and Exchange Commission pursuant to
Section 16 of the Securities Exchange Act of 1934 by management or any
other beneficial owner of more than ten percent (10%) of the Company's
Common Stock.
</Page>
<PAGE>
Item 11. Executive Compensation
- --------------------------------
(a) - (f) and (h) - (l) General
In 1997, Mr. Nemergut and Mr. Coscia accrued salaries of $2,000 per
month.
(g)
In 1997, Directors of the Company receive, as compensation, 5,000
shares of the Company's restricted Common Stock.
Item 12. Security Ownership of Certain Beneficial Owners and Managment.
- -------- -------------------------------------------------------------
(a) - (b) Security Ownership
The following table sets forth information as of December 31, 1997,
with respect to the ownership of the Company's Common Stock by each person
known by the Company to be the beneficial owner of more than five percent
(5%) of the Company's Common Stock, by each director and by all officers
and directors as a group.
<TABLE>
<CAPTION>
Name and Address of Amount of Shares % of Outstanding
Beneficial Holder Beneficially Owned Common Stock
- ------------------------- ---------------------- ------------------
<S> <C> <C>
Nicholas F. Coscia 392,744 25.9%
2124 Glasgow Avenue
Cardiff, CA. 92007
Sterling Venture, Inc. 250,000 16.5%
James A. Egide 165,000 10.9%
P.O. Box 11927
Zephyr Cove, NV 89448
Wepawaug, Inc. 100,000 6.7%
Prospect Creek Ltd. 85,000 5.6%
183 Queens Rd, 50th Fl
Hong Kong
Stephen J. Nemergut 8,000 .5%
1750 Barbara Lane
Leucadia, CA. 92024
George Coleman 7,000 .5%
1750 Barbara Lane
Leucadia, CA. 92024
All directors and Officers 407,744 26.9%
as a group (3 people)
</TABLE>
(c) Changes in Control
Item 13. Certain Restriction and Related Transactions.
- -------- ---------------------------------------------
Inapplicable
</Page>
<PAGE>
Part IV
---------
Item 14. Exhibits, Financial Statement Schedules, and Report on Form 8-K.
- -------- ----------------------------------------------------------------
(a) (1) List of Financial Statements Filed as Part of this Report
Independent Auditors' Report
Balance Sheets as of December 31, 1997 and 1996
Statements of Operations for the years ended December 31, 1997, 1996
and 1995
Statements of Changes in Stockholders' Equity for the years ended
December 31, 1997, 1996 and 1995
Statement of Cash Flows for the years ended December 31, 1997, 1996
and 1995
Notes to Financial Statements
(a) (2) List of Financial Statement Schedule Filed as Part of this
Report.
Inapplicable
(a) (3) Exhibits.
3.1 Second Amended and Restated Articles of Incorporation,
incorporated by reference to Exhibit 3 (a) to the Company's
Annual Report on Form 10-K for the fiscal year ended December 31,
1986, ("1984 Form 10-K"0, Commission File No. 0-13577.
3.2 Certificate of Amendment to the Articles of Incorporation,
incorporated by reference to Exhibit 3 (a) (1) of the Company's
annual report on Form 10-K for the fiscal year ended December 31,
1985, Commission File No. 0-13577.
3.3 Certificate of Amendment to the Articles of Incorporation, dated
December 10, 1987.
3.4 Bylaws, incorporated by reference to Exhibit 3 (b) to the
Company's 1984 Form 10-K.
3.5 Amendment to Bylaws, incorporated by reference to Exhibit 3.4 to
the Company's annual report on Form 10-K for the fiscal year
ended December 31, 1986.
3.6 Amendment to Bylaws and Certificate of Secretary, dated November
9, 1987.
9.1 Agreement dated December 31, 1987, by and among ASDAR
corporation, Multnomah Capital Corporation and James Williams,
incorporated by reference to the Exhibit to Form BY filed by
Hamilton, Williams, dated March 7, 1988.
10.1 Venture Group, Inc., Employee Incentive Stock Option Plan (1984)
incorporate by reference to Exhibit 10 (b) to the Company's 1984
Form 10-K
10.2 Venture Group, Inc., Director's Warrants Plan, incorporated by
reference to Exhibit 10 (b) to the Company's 1984 Form 10-K
10.3 Indemnification Agreement dated January 1, 1988, between ASDAR
Group and Phillip S. Sindler.
</Page>
<PAGE>
10.4 Letter Agreement dated January 19, 1987, incorporated by
reference to the Exhibit to the Schedule 13D filed by James L.
Williams on February 11, 1987.
10.5 Agreement of Sale dated November 30, 1987, between Multnomah
Capital Corporation and Consolidated Securities Corporation,
incorporated by reference to Item 2 of the Company's report on
Form 8-K filed on November 30, 1987.
10.6 Plan and Agreement of Merger dated November 12, 1987, between
National Telephone Information Network, Inc., and Marlin
Enterprises, Inc. incorporated by referenced to Item 5 to the
Company's report on Form 8-k filed on November 30, 1987.
10.7 Agreement dated may 13, 1996, between Registrant and James A.
Egide.
10.8 Agreement dated June 13, 1996 between Registrant and Casino World
Holdings, Ltd.
10.9 Settlement Agreement by and among ASDAR INC., James A. Egide and
Casino World Holdings, Ltd.
27 Financial Data Schedule
*The Exhibit Numbers used refer to the appropriate subsection in
paragraph (b) of 601 of Regulation S-K.
</Page>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities
Exchange Act of 1934, the Registrant has duly caused to be signed on its
behalf by the undersigned, whereunto duly authorized.
Date: April 24, 2000 ASDAR INC.
By: /S/ Nicholas F. Coscia
---------------------------
Nicholas F. Coscia
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this report has been signed below by the following persons on behalf of he
registrant and in the capacities and on the dates included.
/S/ Nicholas F. Coscia Date: April 24, 2000
- ---------------------- --------------------
NICHOLAS F. COSCIA
Director, Secretary
/S/ Stephen J. Nemergut Date: April 24, 2000
- ---------------------- --------------------
STEPHEN J. NEMERGUT
Director, President
</Page>
<PAGE>
ASDAR INC
DECEMBER 31, 1997 & 1996
</Page>
<PAGE>
[Letterhead]
Independent Auditors Report
Board of Directors
ASDAR INC
I have audited the accompanying balance sheets of ASDAR INC, as of December
31, 1997 & 1996, and the related statements of operations, stockholders'
equity, and cash flows for the year ended December 31, 1997 & 1996. 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 I plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatements. 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 the significant estimates made by management, as well as
evaluating the overall financial statements presentation. I believe that
my audit provides a reasonable basis for my opinion.
In my opinion, the aforementioned financial statements present fairly, in
all material respects, the financial position of ASDAR INC, as of December
31, 1997 & 1996, and the results of its operations and its cash flows for
the year ended December 31, 1997 & 1996, 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 #4 to the
financial statements, the Company has an accumulated deficit and a negative
net worth at December 31, 1997. These factors raise substantial doubt
about the Company's ability to continue as a going concern. Management's
plans in regard to these matters are also discussed in Note #4. The
financial statements do not include any adjustments that might result from
the outcome of this uncertainty.
/S/ Schvaneveldt & Company
Salt Lake City, Utah
April 19, 2000
</Page>
<PAGE>
ASDAR INC
Balance Sheets
December 31, 1997 & 1996
<TABLE>
<CAPTION>
December December
31, 1997 31, 1996
----------- -----------
<S> <C> <C>
ASSETS
Current Assets
- --------------
Cash $ 67 $ 2,250
----------- -----------
Total Assets $ 67 $ 2,250
=========== ===========
Current Liabilities
- -------------------
Accounts Payable 24,500 81,500
Note Payable -0- 475,000
----------- -----------
Total Current Liabilities 24,500 556,500
Stockholders' Equity
- --------------------
Common Stock, 50,000,000 Shares
Authorized, at $0.001 Par Value;
1,519,499 & 549,499 Shares
Issued & Outstanding Respectively 1,519 549
Paid In Capital 7,454,013 6,831,233
Treasury Stock ( 199,167) ( 199,167)
Accumulated Deficit (7,280,798) ( 7,186,865)
----------- ------------
Total Stockholders' Equity ( 24,433) ( 554,250)
----------- ------------
Total Liabilities & Stockholders' Equity $ 67 $ 2,250
=========== ============
</TABLE>
The accompanying notes are an integral part of these financial
</Page>
<PAGE>
ASDAR INC
Statements of Operations
December 31, 1997 & 1996
<TABLE>
<CAPTION>
December December
31, 1997 31, 1996
------------ ------------
<S> <C> <C>
Revenues
- --------
Interest Income $ -0- $ 1,834
------------ ------------
Total Revenues -0- 1,834
Expenses
- --------
Interest -0- 4,000
Consulting Fees 90,250 108,250
Other Administrative Fees 3,683 22,298
Professional Fees -0- 218,222
Travel -0- 32,914
Litigation Settlement -0- 2,342,382
------------ ------------
Total Expenses 93,933 2,728,066
------------ ------------
Net Loss ($ 93,933) ($2,726,232)
============ ============
Loss Per Share ($ 0.03) ($ 5.12)
Weighted Average Shares Outstanding 1,680,743 532,832
</TABLE>
The accompanying notes are an integral part of these financial statements
</Page>
<PAGE>
ASDAR INC
Statements of Stockholders' Equity
From January 1, 1996 to December 31, 1997
<TABLE>
<CAPTION>
(Deficit)
Common Stock Paid In Treasury Retained
Shares Amount Capital Stock Earnings
---------------------------------------------------------------
<S <C> <C> <C> <C> <C>
Balance,
January 1, 1996
Retroactively
Restated 499,499 $ 499 $4,361,401 ($ 199,167) ($ 4,460,633)
Shares Issued to
Settle Litigation
Retroactively
Restated 50,000 50 2,469,832
Net Loss for
Year Ended
December 31, 1996 ( 2,726,232)
--------------------------------------------------------------
Balance,
December 31, 1996
Retroactively
Restated 549,499 549 6,831,233 ( 199,167) ( 7,186,865)
Shares Issued to
Settle Note Payable
& Accrued Interest 500,000 500 476,500
Shares Issued for
Services at $0.75
Per Share 55,000 55 41,195
Shares Issued for
Services at $0.25
Per Share 415,000 415 105,085
Net Loss for
Year Ended
December 31, 1997 ( 93,933)
--------------------------------------------------------------
Balance,
December 31, 1997 1,519,499 $ 1,519 $7,454,013 ($ 199,167) ($ 7,280,798)
==============================================================
</TABLE>
The accompanying notes are an integral part of these financial statements
</Page>
<PAGE>
ASDAR INC
Statements of Cash Flows
For the Years Ended December 31, 1997 & 1996
<TABLE>
<CAPTION>
December December
31, 1997 31, 1996
------------ ------------
<S> <C> <C>
Cash Flows from Operating Activities
- ------------------------------------
Net Loss ($ 93,933) ($ 2,726,232)
Adjustments to Reconcile Net Loss to Net
Cash Used by Operating Activities;
Non Cash Expenses 146,750 2,292,382
Changes in Operating Liabilities:
Increase (Decrease) in Accounts Payable ( 55,000) ( 38,900)
------------ ------------
Net Cash Used by Operating Activities ( 2,183) ( 472,750)
Cash Flows from Investing Activities -0- -0-
- ------------------------------------ ------------ ------------
Cash Flows from Financing Activities
- ------------------------------------
Increase Notes Payable -0- 475,000
------------ ------------
Increase in Cash ( 2,183) 2,250
Cash at Beginning of Period 2,250 -0-
------------ ------------
Cash at End of Period $ 67 $ 2,250
============ ============
Disclosures from Operating Activities
- -------------------------------------
Interest $ -0- $ -0-
Taxes -0- -0-
Significant Non Cash Transactions
- ---------------------------------
Issued 50,000 Shares to Settle Litigation -0- 2,469,882
Issued 500,000 Shares to Settle Debts
& Accrued Interest 477,500 -0-
Issued 470,000 Shares for Services 146,750 -0-
</TABLE>
The accompanying notes are integral part of these financial statements
</Page>
<PAGE>
ASDAR INC
Notes to Financial Statements
NOTE #1 - Corporate Data
- ------------------------
ASDAR INC, (the Company), formerly known as the ASDAR Corporation, was
incorporated under the laws of the State of Nevada on November 29, 1983.
Its initial public offering was completed in April, 1985.
In 1987, the Company announced its Registration Distribution Program (RDP).
This Program was designed to assist privately owned companies to become
publicly-held. In exchange for financial consulting and other services,
the Company's shareholders received shares and warrants for the right to
purchase additional shares, which are registered and issued by the client
Company. The Company also may receive a certain percentage of the shares
and warrants offered by the client Company. Subsequently, the client
Company may raise equity capital via proceeds from the exercise of its
common stock purchase warrants.
During 1988, the Securities & Exchange Commission (SEC) and the National
Association of Securities Dealers, Inc., (NASD) reviewed and recommended
changes to the RDP structure, reducing certain benefits and incentives to
the Company and its principals, and improving the benefits to the public
shareholders of the Company.
In 1990, the Company discontinued its efforts in this business venture.
NOTE #2 - Significant Accounting Policies
- -----------------------------------------
1 The Company uses the accrual method of accounting.
2 Revenues and directly related expenses are recognized in the period
when the goods are shipped to the customer.
3 The Company considers all short term, highly liquid investments that
are readily convertible, within three months, to known amounts as cash
equivalents. The Company currently has no cash equivalents.
4 Primary Earnings Per Share amounts are based on the weighted average
number of shares outstanding at the dates of the financial statements.
Fully Diluted Earnings Per Shares shall be shown on stock options and
other convertible issues that may be exercised within ten years of the
financial statement dates.
5 The cost of furniture and equipment was depreciated over an estimated
useful life of five years using the straight-line method. It is the
general practice of the Company to charge maintenance and repairs to
expense; major expenditures for renewals and betterments are
capitalized and are subjected to depreciation over their useful lives.
Upon disposal or retirement, the cost of assets and related
accumulated depreciation are eliminated and any gain or loss is
included in operations.
6 Estimates: The preparation of the financial statements in conformity
with generally accepted accounting principles requires management to
make estimates and assumptions that affect the amounts reported in the
financial statements and accompanying notes. Actual results could
defer from those estimates.
</Page>
<PAGE>
ASDAR INC
Notes to Financial Statements -Continued-
NOTE #3 - Note Payable
- ----------------------
During 1996, the Company attempted a merger/acquisition with Casino World
Holding, LTD., a Delaware Corporation. The Company borrowed from CWH
$425,000 to pay costs and fees associated with the merger/acquisition. The
attempted merger/acquisition did not occur and the Company has committed to
issue to CWH 500,000 shares of its common stock and a note of $50,000 due
May 1, 1997, at 8% interest.
NOTE #4 - Going Concern
- -----------------------
As of December 31, 1995, the Company had no operations from which it could
receive working capital. Since December 31, 1991, the Company has been
dormant and dependent upon its officers and others for loans for its
operating costs. The Company seeks through merger or acquisition to
acquire a company with operations to provide assets and operating capital.
NOTE #5 - Employee Incentive Stock Option Plan & Directors Warrant Plan
- -----------------------------------------------------------------------
The Company adopted an Employee Incentive Stock Option Plan in March 1984,
pursuant to which 1,000,000 shares of common stock may be issued by the
Company to its officers and other key employees. The Company also adopted
a warrant plan, pursuant to which 1,000,000 shares of common stock may be
issued to the directors of the Company. As of December 31, 1997, no
options or warrants have been granted under either of these plans.
NOTE #6 - Income Taxes & Net Operating Loss Carryforwards
- ---------------------------------------------------------
The Company has adopted SFAS 109 to account for income taxes current and
deferred, and any tax benefit (assets) or cost (liabilities) that may arise
from the application of SFAS 109.
Scheduled below are the losses that the Company can carryforward for future
tax benefit.
<TABLE>
<CAPTION>
Year of
Year of Loss Amount Expiration
- ---------------- ------------- ------------
<S> <C> <C>
1987 and Prior $ 1,594,000 2002
1988 199,167 2003
1989 -0- 2004
1990 122,731 2005
1991 288,042 2006
1992 228,826 2007
1993 4,163 2008
1994 100 2009
1995 100 2010
1996 2,726,232 2011
1997 93,933 2012
</TABLE>
Utilization of these losses depend upon the Company's compliance with
provisions of the IRS code. Changes in majority shareholders and changes
in business activities, will result in the loss of availability of the
losses to offset taxable income.
</Page>
<PAGE>
ASDAR INC
Notes to Financial Statements -Continued-
NOTE #6 - Income Taxes & Net Operating Loss Carryforwards -Continued-
- ---------------------------------------------------------------------
Because of uncertainties as to its future and future majority shareholders
the Company has created an evaluation allowance at 100% of any future tax
asset that may occur from application of the net operating loss
carryforward provisions.
<TABLE>
<CAPTION>
1997 1996
----------- -----------
<S> <C> <C>
Maximum Tax Benefit at Current Prevailing Rates $1,765,737 $ 931,610
Evaluation Allowance Net Tax Benefit (Asset) (1,765,737) (931,610)
----------- -----------
Net Tax Benefit (Asset) $ -0- $ -0-
=========== ===========
Current Tax Liability $ -0- $ -0-
Deferred Tax Liability -0- -0-
</Table
NOTE #7 - Account Payable
- -------------------------
During 1996, the Company accrued consulting fees of $79,500 annually,
payable to an Officer for services in attempting to acquire a business
opportunity and bring the Company current with various government agencies.
The Company also owes $500 in filing fees and $2,000 in accrued interest
expenses.
</Page>
</TABLE>
<PAGE>
AGREEMENT
This AGREEMENT, entered into and made effective this 25th day of
January 1997 (the "Execution Date"), by and among (i) James A. Egide, an
individual ("Egide"), (ii) a group of investors led by Egide which consist
of the persons identified in Exhibit A to this Agreement ("the Egide
Group"), (iii) Casino World Holdings, Ltd., a Delaware corporation ("CWH"),
(iv) Casino World International Limited ("CWI"), a Delaware corporation,
(v) Cyber Games Limited, an Irish corporation ("CGL"), (vi) Kendall R.
Lang, an individual ("Lang"), (vii) ASDAR, Group, a Nevada Corporation,
("ASDAR"), and (viii) Nicholas Coscia, an individual ("Coscia"),
(collectively, the "Parties", and individually a "Party"). Egide and the
Egide Group are sometimes referred to collectively herein as the Egide
Parties. CWH, CWI, CGL and Lang are sometimes referred to collectively
herein as the CWH Parties. ASDAR and Coscia are sometimes referred to
collectively herein as the ASDAR Parties.
WHEREAS, by a separate license agreement ("the License"), CWH has
licensed to CGL certain technology relating to the operation of a virtual
casino on the Internet (the "Technology");
WHEREAS, on or about April 29, 1996, ASDAR, by its Secretary and
Director, Coscia and CWH by its Chief Executive Officer, Lang, entered into
a certain letter of intent (the "Letter of Intent") concerning inter alia,
the licensing by ASDAR of the Technology from CWH through CWH's licensee,
CGL;
WHEREAS, in contemplation of a definitive agreement between ASDAR and
CWH based upon the Letter of Intent, the Egide Group advanced to ASDAR the
sum of US $1.15 million and advanced to CWH $300,000 and ASDAR advanced to
CWH through CGL the sum of US $725,000 as evidenced by certain promissory
notes made by CWH and payable to ASDAR as follows (i)$400,000 dated July
22, 1996; (ii) $75,000 dated August 15, 1996, $250,000 dated August 28,
1996 (collectively, the "Promissory Notes");
WHEREAS, pursuant to an Amendment dated July 22, 1996, the Letter of
Intent provides that it expires and is of no force and effect if no
definitive agreement dated between ASDAR and CWH was signed by October 1,
1996;
WHEREAS, no definitive agreement between ASDAR and CWH has been
signed, and CGL and CWH have determined due to certain publicity concerning
ASDAR that it is in their best interest for CGL not to issue any sublicense
under the License to the Technology to ASDAR;
WHEREAS, in contemplation of the execution of this Agreement, CWH sold
to the Egide Group, and the Egide Group has purchased from CWH for
$1,025,000, 410,000 shares of CWH common stock (which $1,025,000 was paid
through cancellation and conversion of the $300,000 unpaid advance, and
assignment to CWH of the Egide Group's claim for $725,000 against ASDAR),
pursuant to the terms of a separate subscription agreement;
1
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<PAGE>
WHEREAS, ASDAR has commenced an action, Case No. 00705687 against CWH,
Lang and Kurt Fornal in the Superior Court of the State of California,
County of San Diego concerning the Notes; and
WHEREAS, the Parties wish to resolve any and all claims and disputes
between of among them relating to or arising out of License, the Notes, the
Technology and the Letter of Intent, including, without limitation, claims
relating to or arising out of actions contemplated under the Letter of
Intent, or actions taken by reason of the Letter of Intent;
NOW, THEREFORE, in consideration of the mutual promises and agreements
se forth herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties, hereby agree as
follows;
1. Representations and Warranties
------------------------------
Each of the Parties represents and warrants to each of the other
Parties that;
1.1 it is represented by counsel and has made such independent
investigation of the facts pertaining to this Agreement, as it
deems necessary;
1.2 it had read this Agreement and understands its contents;
1.3 it has the power and authority to execute and deliver this
Agreement and perform its obligations hereunder;
1.4 the execution, delivery and performance of this Agreement has
been duly and validity authorized by it;
1.5 upon mutual execution and delivery, this Agreement will
constitute a valid and binding agreement of it; and
1.6 its execution, delivery and performance of this Agreement will
not result in the breach of, or give rise to, the termination of
any other agreement to which it is a party.
Each of the signatories to this Agreement represents and warrants to each
of the Parties that he is authorized to execute this Agreement on behalf
of the persons for whom he is signing the Agreement.
2. Acknowledgment of Right, Title and Interest
-------------------------------------------
2.1 The Parties acknowledge that CWH is the exclusive owner of all
rights to the Technology, including without limitation the
MindWire (TM) and CWH software and improvements thereto. None of
the Parties, except for CWH, has the right to use such Technology
in any manner, including, without limitation, for the operation
of virtual casinos on the Internet, except to the extent that it
is validity licensed to do so by CWH.
2
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<PAGE>
3. Covenants
---------
3.1 ASDAR acknowledges its current indebtedness of $425,000 to the
EGIDE Group and in order to discharge such debt shall issue to
Egide and/or the Egide Group pursuant to a schedule to be
provided to ASDAR by Egide 500,000 shares of its Common Stock and
a note for $50,000 due not later than May 1, 1997, bearing
interest at the rate of eight percent (8%) per annum from July 1,
1996.
3.2 Contemporaneously with the execution of this Agreement, CWH will
convert and cancel ASDAR's $725,000 indebtedness to CWH and ASDAR
will assign the Promissory Notes all rights and liabilities under
them to CWH, pursuant to the assignment agreement attached hereto
as Exhibit B.
3.3 Contemporaneously with the execution of this Agreement, ASDAR
will execute and file the Stipulation of Dismissal with Prejudice
attached hereto as Exhibit C.
3.4 Contemporaneously with the execution of this Agreement, Lang will
issue to Coscia warrants to purchase up to 50,000 shares of CWH
common stock at $2.50 per share and warrants to purchase 200,000
additional shares of CWH common stock at $2.50 per share. The
warrants for the additional 200,000 shares shall be conditional
on the closing of a financing agreement between CWH, Egide, and
the Egide Group or any person or entity referred to CWH by Egide
of not less than $5,000,000. The warrants for all shares are
subject to any restrictions or encumbrances on such shares now
existing or existing at the time the warrant is exercised,
including, without limitation, the pledge of those shares to
secure a debt. The parties precise rights and obligations with
respect to the warrants described herein are set forth in a
separate agreement attached hereto as Exhibit D. Nothing
contained in this paragraph shall, alter or modify, or otherwise
be used to construe or interpret the terms of the separate
agreement attached hereto as Exhibit D;
3.5 Contemporously with the execution of this Agreement, CWH will
issue to Egide warrants to purchase 100,000 shares of CWH common
stock at $2.50 per share, such sale of shares to be pursuant to
the terms of a separate agreement attached hereto as Exhibit E.
Egide has previously received warrants to purchase 500,000 shares
of CWH common stock at $2.50 per share pursuant to the term of
the separate Finders' Fee Agreement; and
3.6 The parties contemplate that there may be a second stage
financing involving the CWH Parties. In the event that such
financing occurs, Egide will use reasonable efforts to assist in
such financing.
3
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<PAGE>
4. Termination of Letter of Intent
-------------------------------
The Letter of Intent is hereby terminated and of no further force or
effect.
5. Mutual Releases and Indemnities
-------------------------------
5.1 By the ASDAR Parties - The ASDAR Parties, and each of their
respective Privies hereby release and forever discharge each and
every other Party and each and all of the other Parties' present
or former Privies, from each and every liability, claim, share,
cause of action, and demand of any sort, whether known or
unknown, contingent, accrued, inchoate, or otherwise, from the
beginning of time up to the Execution Date of this Agreement.
5.2 By the Egide Parties - Egide, on behalf of himself and each and
every person in the Egide Group, and each of their respective
Privies hereby release and forever discharge each and every other
Party and each and all of the Parties' present or former Privies,
from each and every liability, claim, charge, cause of action,
and demand of any sort, whether known or unknown, contingent,
accrued, inchoate, or otherwise, from the beginning of time up to
the Execution Date of this Agreement. Egide represents and
warrants that he is authorized to provide this Release on behalf
of the Egide Group.
5.3 By the CWH Parties - The CWH Parties, and each of their
respective Parties, hereby release and forever discharge each and
every other Party, and each and all of the other Parties' present
or former Privies, from each and every liability, claim, charge,
cause of action, and demand of any sort, whether known or
unknown, contingent, accrued, inchoate, or otherwise, from the
beginning of time to the Execution Date of this Agreement.
5.4 Privies. As used in this Agreement, the term "Privies" refers
to: administrators, affiliates, agents, assigns, attorneys,
consultants, directors, employees, executors, heirs, insurers,
officers, predecessors, principals, representatives, reinsurers,
servants, shareholders, subsidiaries, successors, sureties and
trustees.
5.5 With respect to all releases in this Agreement:
5.5.1. the releases are the results of a compromise and will
never at any time for any purpose be considered an admission as
to the fact or amount of any liability or responsibility of any
of the Parties;
5.5.2 the release does not operate to release any rights, or
obligations arising out of this Agreement, and
4
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<PAGE>
5.5.3 the Parties expressly waive the application of
California Civil Code 1542 and/or any similar state or federal
law. California Civil Code 1542 provides;
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH
THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN
HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR.
It is the intention of the Parties that the releases executed
hereunder will be, and remain, in effect as full and complete
releases of those matters set forth in the releases,
notwithstanding the discovery of any additional or different
facts or claims that existed prior to the date of the releases.
5.6 Indemnities
-----------
5.6.1. Each party agrees to defend, indemnify and hold each other
Party harmless from any later assertion of any right or claim which
(i) the indemnifying Party is representing it is releasing hereunder
of (ii) arises out of or is related to any breach by the indemnifying
party of the covenant, representation or warranty hereunder.
5.6.2. In addition to the indemnifying set forth in section 5.6.1,
the ASDAR Parties, jointly and severally agree to indemnify and hold
the CWH Parties harmless from any assertion of any right or claim by
any past or current shareholder of ASDAR arising out of or relating to
violation of any federal or state securities laws and based upon any
act of omission by Coscia or ASDAR, provided, however, that Coscia
shall not be obligated to indemnify Lang, CWH, CWI or CGL for any
attorneys fees relating to any assertion of such right or claim,
except to the extent that he agrees to assume and control the defense
of any action as provided in section 5.6.4.2 below.
5.6.3. In addition to the indemnity set forth in section 5.6.1,
Egide agrees to indemnify and hold the ASDAR Parties and the CWH
Parties from any assertion of any right or claim by any past or
current member of the Egide Group arising out of or relating to
violation of any federal of state securities laws.
5.6.4. Procedure for Indemnification - The following procedures
shall apply to indemnification under this Agreement:
5
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<PAGE>
5.6.4.1 Promptly after receipt by an indemnities of written notice
of the assertion of any claim subject to indemnification, the
indemnities shall give written notice to the indemnitor and shall
thereafter keep the indemnitor reasonably informed with respect
thereto, provided that failure of the indemnities to give the
indemnitor prompt notice as provided herein shall not relieve the
indemnitor of any of its obligations unless such failure materially
prejudices the Indemnitor.
5.6.4.2 The Indemnitor shall be entitled to assume and control the
defense of any action based upon a claim subject to indemnification by
providing written notice to the indemnities within thirty days from
receipt of notice of the commencement of such action of its intention
to do so, with counsel reasonably satisfactory to the indemnities and
at indemnitor's own expense. Notwithstanding the assumptions by the
indemnitor of the defense of any such action as provided herein, the
indemnities shall be permitted to join in the defense of such action
and to employ counsel at its own expense.
5.6.4.3 If the indemnitor shall assume defense of any such action,
it shall not settle such action unless such settlement includes as an
unconditional term thereof, the giving by the claimant of a release of
the indemnities, satisfactory to the indemnities, from all liability
with respect to such action.
5.6.4.4 If the indemnitor fails to notify the indemnities of its
desire to assume the defense of any such action within the prescribed
period of time, then the indemnities may assume the defense of such
action and the indemnitor shall be bound by any determinations made in
such action or any settlement effected by the indemnities.
6. Miscellaneous Provisions
------------------------
6.1 Confidentiality - Neither the terms of this Agreement nor any
non-public information communications and writings between or
among the Parties of their Privies relating to, concerning or
arising from the Letter of Intent or the transactions
contemplated thereby will be disclosed by any Party, except with
the specific written consent of the other Parties, provided,
however, that nothing in this Agreement will be construed to
prevent any Party from disclosing the terms of this Agreement:
6
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<PAGE>
6.1.1 as required by any court or other governmental body,
provided that the disclosing Party will use all reasonable efforts to
obtain confidential treatment of materials so disclosed;
6.1.2 as otherwise required by law, provided that the disclosing
Party uses all reasonable efforts to obtain confidential treatment of
materials so disclosed;
6.1.3 to legal counsel of the Parties, in confidence, to
accountants, banks, and financing sources, and other advisors or
consultants of the Parties;
6.1.4 in connection with the enforcement of this Agreement or
rights under this Agreement, provided that the disclosing Party will
give reasonable advance notice to the other Parties for the purpose of
affording them the opportunity to seek a protective order; or
6.1.5 in confidence, in connection with an actual or proposed
license, merger, acquisition, or similar transaction.
6.2 Entire agreement; amendment - This Agreement is the entire agreement
between the Parties with respect to the matters set forth herein and
supersedes all other prior agreements or understandings, whether
written or oral. No representation, oral or otherwise, express or
implied, other than those expressly set forth herein have been made by
any Party to any other Party concerning the subject matter of this
Agreement. This Agreement may not be modified or amended other than
in writing signed by the Party(ies) whose rights or obligations are
modified or amended.
6.3 Waiver - The failure of a Party to insist upon another Party's strict
adherence to any term of this Agreement on any occasion will not be
construed as a waiver or deprive that Party of the right thereafter to
insist upon strict adherence to that term of any other term or this
Agreement.
6.4 Severability - If any provision or sub-provision of this Agreement is
found invalid of unenforceable, the balance of the Agreement, and all
provisions thereof, will remain in full force and effect.
6.5 Interpretation
6.5.1 All headings throughout this Agreement have been inserted
for the purpose of ease of reference only and do not define, limit or
affect the meaning or interpretation of this Agreement or of any
instrument created pursuant hereto or in accordance herewith.
7
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<PAGE>
6.5.2 Each Party has been provided with an opportunity to
participate in the drafting and preparation of this Agreement.
Therefore, in any construction to be made of this Agreement, the same
will not be construed against any Party.
6.6 Governing Law - This Agreement is governed by, and is to be construed
in accordance with the laws of the State of California, without giving
effect to that State's conflict-of-laws rules.
6.7 Dispute Resolutions - The Parties agree that all disputes,
controversies or claims arising out of, relating to or in connection
with this Agreement, including the formation, breach, default,
termination or invalidity thereof ("Disputes") will be finally settled
under the Commercial Arbitration Rules of the American Arbitration
Association. The Dispute will be decided be a single arbitrator
agreed upon by the Parties. If the Parties are unable to agree upon
an arbitrator within 30 days of the filing of the Demand for
Arbitration, the Parties may agree to have the single arbitrator
appointed by the American Arbitration Association in accordance with
its rules. If the parties do not agree to have a single arbitrator
appointed, the Dispute shall be decided by the majority decision of
three arbitrators. The Claimant(s) and Defendant(s) shall each
appoint one arbitrator with 15 days. The third arbitrator shall be
selected by agreement of the party-appointed arbitrators within 15
days of the appointment of the last to be appointed arbitrator. If
either party fails to select its arbitrator or the party appointed
arbitrators fail to agree upon a third arbitrator, within the time
limit set out above, the missing arbitrator(s) shall be appointed by
the American Arbitration Association in accordance with its rules. The
proceeding will be conducted in San Diego, California in the English
language. The arbitrator(s) will have the power to award costs and
attorneys' fees, and will award attorneys' fees to the prevailing
Party in any arbitration. The Parties waive objection to venue and
submit to the jurisdiction of the United States District Court for the
Southern District of California, for the resolution of any dispute
arising out of or relating to this agreement to arbitrate or the
enforcement thereof, or, in the event that such court does not have
subject matter jurisdiction of any such dispute, the Parties waive
objection to venue and submit to the jurisdiction of the Superior
Court of the State of California, County of San Diego. Prior to the
selection of the arbitral panel, nothing in this agreement to
arbitrate will prevent the Parties from applying to a court that would
otherwise have jurisdiction for provisional or interim measures.
After the arbitral panel is selected, it will have sole jurisdiction
to hear such applications, except that the Parties agree that any
measure ordered by the arbitrator may be immediately and specifically
enforced by a court otherwise having jurisdiction over the Parties.
Each Party hereto hereby agrees that the arbitration procedures
provided herein will be the sole and exclusive method of resolving any
of the aforesaid disputes, controversies or claims.
8
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<PAGE>
6.8 Counterparts - This Agreement may be executed in one or more
counterparts, and, when each Party has signed and delivered at least
one such counterpart, each counterpart shall be deemed an original,
and, when taken together with the other signed counterparts, shall
constitute one Agreement, which shall be binding upon and effective as
to each of the Parties.
[REMAINDER OF THE PAGE LEFT INTENTIONALLY BLANK]
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<PAGE>
IN WITNESS WHEREOF, the Parties have executed this Agreement or caused this
Agreement to be executed by their duly authorized representatives as of the
date first set out above.
CYBER GAMES LIMITED
/S/ Nicolas F. Coscia By: /S/ Kendall R. Lang
- --------------------- ------------------------
Nicholas F. Coscia Its: Attorney In Fact
ASDAR GROUP
/S/ James A. Egide By:/S/ Stephen J. Nemergut
- -------------------- --------------------------
James A. Egide Its: Secretary & Director
EGIDE GROUP
/S/ Kendall R. Lang By: /S/ James A. Egide
- -------------------- --------------------------
Kendall R. Lang Its: Authorized Agent for the
Group and Each of its Members
CASINOWORLD HOLDINGS, LTD.
By: /S/ Kendall R. Lang
- ------------------------
Its: CEO
CASINOWORLD
INTERNATIONAL LIMITED
By: /S/ Kendall R. Lang
- ------------------------
Its: /S/ Attorney in Fact
10
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<PAGE>
<TABLE>
<CAPTION>
EXHIBIT A
EGIDE GROUP
-----------
<S> <C>
- ------------------------------ ------------------------------
Paul Soll William Richards
17624 Corinthian Drive
Encino, CA 91316
5,000 Shares 5,000 Shares
- ------------------------------ ------------------------------
Alex Moscowitz Rich Taylor
22620 Hatteras Street 555 California St., 22nd Flr.
Woodland Hills, CA 91367 San Francisco, CA 94104
5,000 Shares 5,000 Shares
- ------------------------------ ------------------------------
Eli Haber Henry Weingarten
4820 Quedo Place 5034 Odesa Avenue
Woodland Hills, CA 91364 Encino, CA 91316
5,000 Shares 8,000 Shares
- ------------------------------ ------------------------------
Eli Schneidman Jack & Carolyn Weingarten
506 No. Palm Drive 12365 Ridge Circle
Beverly Hills, CA 90210 Los Angeles, CA 90049
3,000 Shares 5,000 Shares
- ------------------------------ ------------------------------
Don Gruberger Gordon Benson
5543 Partridge Court 16830 Ventura Blvd. #500
Westland Village, CA 91362 Encino, CA 91436
3,000 Shares 2,000 Shares
- ------------------------------ ------------------------------
Tod Gruberger Gerald Guez
15906 Valley Vista 992 North Apline
Encino, CA 91436 Beverly Hills, CA 90210
3,000 Shares 10,000 Shares
- ------------------------------ ------------------------------
11
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<PAGE>
<PAGE>
- ------------------------------ ------------------------------
Joel Weingarten Todd & Kimberly Kay
1150 Summit Drive
Beverly Hills, CA 90210
5,000 Shares 10,000 Shares
- ------------------------------ ------------------------------
Barry Thirot Calls International, Inc.
3933 Southview Terrace 15303 Ventura Blvd. #1075
Medford, OR 97504 Sherman Oaks, CA 91403
10,000 Shares 20,000 Shares
- ------------------------------ ------------------------------
C.J. Overseas Robert Domush
c/o Glenn Hartman 60 Via Navarro
2728 Teton Pines Drive Greenbrae, CA 94904
Jackson, WY 83001
60,000 Shares 8,000 Shares
- ------------------------------ ------------------------------
Steve Campango Manfred Stuvole
900 Mission Avenue 5770 Snowshoe Circle
San Rafeal, CA 94901 Bloomfield Hills, MI 48301
40,000 Shares 8,000 Shares
- ------------------------------ ------------------------------
Marin Catholic High School Ken Egide
675 Sir Francis Drake Blvd
Kentfield, CA 94904
25,000 Shares 7,000 Shares
- ------------------------------ ------------------------------
Gerald Richardson Prospect Creek Ltd.
80 Palomino Circle c/o Boo Binden
Novato, CA 94947 50th Flr., Hopewell Center
183 Owens Road East
Hong Kong
20,000 Shares 50,000 Shares
- ------------------------------ ------------------------------
Tom Clark Mary Ann Egide
9 Silo Ridge Road P.O. Box 11927
North Salem, NY 10560 Zephyr Cove, NJ 89448
20,000 Shares 15,000 Shares
- ------------------------------ ------------------------------
</TABLE>
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<PAGE>
EXHIBIT C
RUSSELL M. DE PHILLIPS (CSB #95034)
SEAN C. COUGHLIN (CSB #167900)
MILBERG & DE PHILLIPS, P.C.
2163 Newcastle Avenue, Suite 200
Cardiff by the Sea, CA 92007-1824
Telephone: (619) 943-7103
Attorneys for Plaintiff, ASDAR GROUP, INC.
SUPERIOR COURT OF THE STATE OF CALIFORNIA, COUNTY OF SAN DIEGO
SAN DIEGO BRANCH
ASDAR GROUP, INC., a Nevada Corporation, ) CASE NO. 00705687
)
Plaintiff ) STIPULATION
) OF DISMISSAL WITH
v. ) PREJUDICE
) ------------------
)
CASINO WORLD HOLDINGS, LTD., a )
Delaware corporation, KENDALL LANG; )
KURT FORNAL and Does 1 to 100, inclusive )
)
Defendants )
- ----------------------------------------- )
)
)
IT IS HEREBY STIPULATED AND AGREED by and between ASDAR GROUP ("ASDAR") and
CASINO WORLD HOLDINGS, LTD., KENDALL LANG, and KURT FORNAL that the
Complaint and each and every claim which was or could have been asserted by
ASDAR in the above captioned action against any of the defendants be, and
the same hereby are, DISMISSED WITH PREJUDICE, each party to bear its own
costs and expenses.
Dated: January 1997,
BAKER & McKENZIE MILBERG & DE PHILLIPS
By:/S/ David C. Doyle By: /S/ Russell M. De Phillips
------------------ --------------------------
David C. Doyle Russell M. De Phillips
Sean C. Coughlin
Attorneys for CASINO WORLD HOLDINGS Attorneys for ASDAR GROUP
LTD, KENDALL LANG and KURT FORNAL
13
<PAGE>
ASDAR GROUP
P.O. BOX 789
CARDIFF, CA. 92007
May 13, 1996
Jim Egide
P.O. Box 11907
Zephyr Cove, Nev 89449
Dear Jim,
As we have discussed ASDAR agrees to the following terms for its
proposed fundings;
1. You or your designee shall loan ASDAR $1,000,000 to be
repaid on or before September 1, 1996. Such loan shall
be secured by 500,000 shares (post reverse split) of
ASDAR stock. This $1,000,000 will be close by May 31,
1996.
2. You shall arrange for the purchase of an additional
$4,000,000 of stock at a tentative price as follows:
a) Fifty percent (50%) at a price of $5.00 per share
b) Fifty percent (50%) at a price to be determined by
mutual consent of the parties, price based upon the
market price at the time but not less than $5.00 as
long as the public stock price is at least $5.000;
c) Closing shall be on or about September 1, 1996 and
the 1 for 100 reverse stock split will be complete.
3. You shall purchase 60,000 shares of the free trading
stock at $.02 per share.
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<PAGE>
4. You shall be granted an option to purchase 250,000
shares (post split) at $5.00 per share from current share
holders. Such shares shall have "piggy back" registration
rights with any future public offering subject to normal
broker lockup agreements.
ASDAR GROUP
/S/ Nicholas F. Coscia
------------------------
by: Nicholas F. Coscia
Secretary and Director
</Page>
<PAGE>
[Letterhead]
June 13, 1996
Mr. Nick Coscia, Secretary
ASDAR GROUP
P.O. Box 789
Cardiff, CA 92007
RE: CASINOWORLD HOLDINGS, LTD./LICENSE AGREEMENT
Dear Mr. Coscia,
We confirm the intent of CasinoWorld Holdings, Ltd. (Licensor) to
grant a non exclusive license and to cause a foreign gambling license
from the country of Ecuador to be issued to ASDAR Group (Licensee), a
publicly-held corporation, to utilize, market, and bankroll the Virtual
CasinoWorld (TM) software and hardware applications, know-how, trade
secrets, copyrights, and trademarks of Licensor and for Licensor to
grant a non-exclusive sub-license to the MindWire (TM) software
technology to Licensee under the following terms and conditions:
1. CONSIDERATION
-------------
The total license fee for the use of the Virtual CasinoWorld (TM)
application and the creation of a foreign gaming sub-license to be
issued from the country of Ecuador shall be Two Million Dollars
($2,000,000) and shall be payable as follows:
1.1 ASDAR shall issue Forty Million (40,000,000) (pre-reverse
split) or Four Hundred Thousand (400,000) (post-reverse split)
shares of Licensee's common stock. Common stock shall be
issued to licensor on or before September 1, 1996.
1
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<PAGE>
Nick Coscia
June 13, 1996
Page 2
2. CONDITIONS PRECEDENT
--------------------
Licensor's grant of a nonexclusive license to Licensee shall be subject
to the following terms and conditions:
2.1 Licensee's execution of this Letter of Intent.
2.2 Licensee's certification that if a corporation in good
standing and validly existing under the laws of its
jurisdiction of incorporation.
2.3 Licensee's certification that its action entering this License
has been duly authorized by Licensee's board of directors and
any governmental agencies of any kind having jurisdiction over
Licensee and its activities.
2.4 Licensee's submission to Licensor, in a form and manner
acceptable to Licensor, of a commitment for a bankroll amount
irrevocably available to Licensee's site of not less than One
Million Dollars ($1,000,000) in U.S. Funds, and a marketing
plan acceptable to Licensor and Licensee's marketing budget of
not less than Two Million Dollars ($2,000,000).
2.5 Licensee's certification that entering this License will not
violate any other agreements of any kind to which Licensee is
a party and that this License will be enforceable by its
terms.
2.6 Licensee's counsel's opinion, in a form and content
satisfactorily to Licensor, of Paragraphs 2.2 through 2.5
above.
2.7 Licensee's acknowledgment of the proprietary nature of
Licensor's technology by execution of Licensor's standard
confidentially agreement.
2.8 Licensee's agreement that all publicity, press releases, and
public announcements of any kind, by whatever means of
dissemination, shall be subject to the prior approval of
Licensor.
2
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<PAGE>
<PAGE>
Nick Coscia
June 13, 1996
Page 3
3. LICENSE AGREEMENT TERMS AND CONDITIONS
--------------------------------------
The License shall contain the following terms and conditions:
3.1 It shall be nonexclusive and shall provide for an initial term
of Ten (10) years and shall be renewable thereafter year-to year
for an additional Five (5) year term.
3.2 It shall provide for a covenant not to compete to be binding
upon the Licensee and it shall incorporate provisions to
protect the confidentially of Licensor's trade secrets and
other technology.
3.3 It shall require the Licensee promptly to notify the Licensor
of any infringement by or upon any third parties and the
Licensor shall take such action it may deem reasonably
required, at law or equity, against the actions of any third
party infringements reported by the Licensee.
3.4 It shall require the Licensor to provide administrative
support and operational assistance through its affiliate, a
Republic of Ireland corporation now in formation and it shall
require Licensor to provide a copy of its Joint Venture
Agreement with Monacall with an opinion of counsel the
agreement has been duly executed, is valid, and is binding
according to its terms.
3.5 It shall require Licensor to cause a foreign gaming license to
be issued to the Licensee from the country of Ecuador.
3.6 It shall include provisions acceptable to the Licensor and the
Licensee for arbitration of their disputes in lieu of
litigation, assignability, amendments, choice of law,
indemnification, and related matters.
3.7 It shall require the Licensee to negotiate only with the
Licensor for all future rights for any telephone or satellite
on-line gambling technology and the required sub-licenses for
any virtual casino to be located in sovereign Indian Nations;
who are clients of the Licensee.
3
</Page>
<PAGE>
Nick Coscia
June 13, 1996
Page 4
4. REVENUE SHARING TERMS AND CONDITIONS
------------------------------------
Simultaneously with execution of the license agreement, the
Licensee shall also execute a Revenue Sharing Agreement which shall
define revenues as the net win (gross revenues less pay-outs and
jackpots) and which shall provide for payment of thirty-three (33%)
percent of such net win to the Licensee and for payment of the balance
of such net win (sixty-seven (67%) percent) to the Licensor.
5. SCHEDULE OF EXECUTIONS
----------------------
5.1 Within thirty (30) days after execution of this Letter of
Intent, the Parties shall complete the exchange of all
documents, including a draft License, and the completion of
all steps identified in this Letter of Intent.
5.2 On or before September 1, 1996 the Parties shall execute the
License.
If the above meets with your approval, please sign below.
Cordially yours,
/S/ Kendall R. Lang
- --------------------
Kendall R. Lang
Chief Executive Officer
ACCEPTED BY ASDAR GROUP
By: /S/ Nicholas F. Coscia (SEAL)
----------------------
Its Authorized Agent
4
</Page>
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<ARTICLE> 5
<CIK> 0000746631
<NAME> ASDAR INC
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<CASH> 67
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 67
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 67
<CURRENT-LIABILITIES> 24,500
<BONDS> 0
0
0
<COMMON> 1,519
<OTHER-SE> (25,952)
<TOTAL-LIABILITY-AND-EQUITY> 67
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 93,933
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (93,933)
<INCOME-TAX> 0
<INCOME-CONTINUING> (93,933)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (93,933)
<EPS-BASIC> (0.03)
<EPS-DILUTED> (0.03)
</TABLE>
