United States
U. S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-SB12G/A
GENERAL FORM FOR REGISTRATION OF
SECURITIES OF SMALL BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
Blini Hut, Inc.
Formerly "Bargain Products, Inc."
(Exact name of registrant as specified in its charter)
Nevada 88-0335902
________________________________ ________________
(State or other jurisdiction of (I.R.S. employer identification
incorporation or organization) number)
2920 North Green Valley Parkway, Building 3, Suite 321 Henderson, Nevada 89014
(Address of principal executive offices)
Issuer's Telephone Number: (702) 458-4153
Securities to be registered under Section 12(b) of the Act:
Title of each class to be so registered: n/a
Name of exchange on which each class is to be registered: n/a
Securities to be registered under Section 12(g) of the Act:
Common Stock, par value $.03 per share
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 1 - DESCRIPTION OF BUSINESS
GENERAL
Blini Hut, Inc., formerly Bargain Products, Inc. (the "Company") was
organized as a Nevada corporation on April 6, 1995. The Company was engaged in
the business of selling low cost consumer products at the retail level through
its wholly owned subsidiary, Dollar Mania, Inc., from June 1995 through
September 1996. Dollar Mania was unable to financially support its rapid
expansion and in order to protect its assets filed chapter 11 bankruptcy
on March 28, 1996.Because the company's obligations were far in excess of its
assets, after a number of months of review, examination, and discussions
between major creditors, the bankruptcy trustee, the company's bankruptcy
counsel, and its corporate counsel, the company decided to spin off its wholly
owned subsidiary, Dollar Mania, by transferring all of the issued and
outstanding common stock of Dollar Mania to the Bankruptcy Trustee. The
Company has been inactive without operations since September 1996, but on
May 18, 1999 the Company changed its name to Blini Hut,
Inc., and now intends to engage in the marketing and distribution of
various specialty Eastern/European fast food restaurants. The Company
proposes to develop specialty Eastern/European fast foods restaurants
through creating company owned restaurants and through franchising. The Company
has no current operations in the marketing and development of specialty foods
or fast food restaurants, and current management has no experience in this line
of business.
PRINCIPAL MARKETS AND PRODUCTS
The principal market at this time is proposed to be in the New York
Metropolitan area. The products are specialty Eastern/European foods which
will be sold through fast food restaurants. The Company has no existing
committments related to opening new restaurants nor has the Company sought to
market its proposed business to potential franchisees at this time. The Company
hopes to be able to open restaurants and/or engage in franchising efforts during
the first quarter of 2000.
METHODS OF DISTRIBUTION
The Company proposes to expand through development of company owned
stores and franchising in ethnic quick serve restaurants.
SUPPLIERS
The Company will be supplied by food wholesalers in the New York
Metropolitan area.
COMPETITION
The market for the establishment of specialty Eastern/European fast food
restaurant operations is expanding. The company will be at a disadvantage with
other companies having larger technical staffs, established market shares and
greater financial and operational resources than the company. There can be no
assurance that the Company will be able to successfully compete.
YEAR 2000 ISSUES AND DISCLOSURE
Management has determined that the issues/problems associated with the
'Year 2000' computer bug will not have a material effect on the Company's
business, results of operations, or financial condition. The Company does not
own, lease, or operate any equipment at this time. Management will use
precaution in the future when purchasing equipment to make sure it meets any and
all compliance standards. Although management deems it highly improbable, a
risk associated with the Y2K issue would be that vendors who supply products to
the Company could be affected, and thereby could affect its operations.
Although The company is not currently operating, it plans to commence operations
in the first quarter of 2000. Transportation could be affected which could cause
us to receive supplies late, and could cease or slow operations, resulting in a
detrimental effect on the Company.
SEASONALITY
The Company is not measurably affected by a seasonal trend.
EMPLOYEES
The Company has no employees at this time. Upon initial operations, the
Company anticipates that it will need five employees to develop menus, find and
secure site locations, negotiate leases, design layout of restaurants, set up
operational procedures and develop training guidelines for future
employees.
The Company proposes to have five employees upon initial operation and
expects that it will require eight to ten employees per restaurant. The
company plans to open five restaurants during the year 2000.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
GENERAL
Blini Hut, Inc, formerly Bargain Products, Inc., (the "Company") was
organized as a Nevada corporation on April 6, 1995. The Company was engaged in
the business of selling low cost consumer products at the retail level through
its wholly owned subsidiary of Dollar Mania from June 1995 through
September 1996. The Company has been inactive without operations since
September 1996. May 18, 1999 the Company changed its name to Blini Hut, Inc.,
and now intends to engage in the marketing and distribution of various
Eastern/European specialty food through fast food restaurants. The Company has
entered into an agreement to acquire Troika Food, Inc., a Delaware
Corporation ("Troika") which currently has no business operations but plans
to market and distribute various specialty foods through fast food
restaurants.
POTENTIAL ACQUISITION
On April 10, 1999, the Company entered into an agreement with the
shareholders of Troika to issue them 6,000,000 shares of common stock in
exchange for all the outstanding shares of common stock of Troika, which when
closed, would make Troika a wholly owned subsidiary of the Company. This
agreement has not closed and there is no assurance that it will do so.
Troika has no business operations at this time but plans to open and operate
specialty fast food restaurants focusing on Eastern/European menus.
The Blini Hut/Troika acquisition, although not consumated, was negotiated
by the shareholders of Troika and their counsel and the management of Blini
Hut and their counsel. While an acquisition agreement has been signed by Blini
Hut and the shareholders of Troika, there is no assurance that this transaction
will be consumated. The consideration to be issued was negotiated by the above
parties based upon an arrangement whereby six Bargain Products shares were to be
issued for each of the Troika shares. The Troika shares were valued higher
based on the management expertise of Troika in the Eastern European fast food
business. Blini Hut has not issued any shares to the Troika Shareholders, but
if and when issued, it is expected that Blini Hut will rely on the exemptions of
Regulation D and Section 4(2) of the Securities Act of 1933.
There are 2 principal shareholders of Troika; Simon Kublanov owning 300,000
shares and Leonid Kuvykin who owns 700,000 shares. The Troika shareholders hold
no positions in Blini Hut.
Blini Hut has not had any revenues from operations in each of the last two
fiscal years. The Company plans to open 5 restaurants during the year 2000, at a
cost of approximately $200,000 per restaurant, which amount is anticipated to be
expended in the following manner:
Initial Lease Payments...................$40,000
(including 3mo. security dep.)
Leasehold Improvements...................$50,000
Equipment................................$80,000
Inventory................................$10,000
Advertising/Promotions...................$20,000
==========
TOTAL...................$200,000
The cost of opening a restaurant may vary depending on location, price of rent,
condition of structure and existing equiment. The company does not have
sufficient capital at this time to open any restaurants, but anticipates raising
capital for its restaurant operations through public and/or private financing
either through stock offerings or loans from private parties. There is no
assurance that the Company will be successful in raising capital for its
restaurant operations. The Company may also consider leasing its restaurant
equipment. The Company may also consider acquiring other quick serve operations
and convert them to Eastern Euorpean fast food specialty restaurants.
Acquisitions may be made through a combination of stock and cash. The Company
has no agreements to acquire other quick serve restaurants at this time.
ITEM 3-DESCRIPTION OF PROPERTY
The Company does not own or lease any property at this time but is using
without charge the office address of its President for mailing purposes only.
Using the address has no intrinsic value and is done as a convenience to the
President of the Company. The mailing address is 2920 North Green Valley
Parkway, Building 3, Suite 321 Henderson, Nevada 89014, telephone no. (702)
458-4153, fax no. (702) 898-7103.
ITEM 4-SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following tables sets forth, as of the March 15, 1999 Offering
Memorandum, the outstanding shares of common Stock of the company owned of
record or beneficially by each person who owned of record, or was known by
the Company to own beneficially, more than 5% of the Company's Common Stock,
and the name and share holding of each officer and director and all officers
and directors as a group.
Title of
Class Name & Address Amount & Nature Percent of Class
of Beneficial Owner(1) of Beneficial Owner(1)
______ ____________________ ______________________ _____________
Common Dimitri Gratchev 500,000 14.3%
42A Altvfevskoe Shsse#74
Moscow, Russia 127566
Common Max Tanner 496,000 14.1%
2950 E. Flamingo Rd. Ste.G
Las Vegas, Nevada 89121
___________
(1) If Blini Hut completes the acquisition of Troika Foods, Inc., Simon
Kublanov, a principle shareholder of Troika, will own 1,800,000 shares or 20% of
Blini Hut and Leonid Kuvykin, also a principle shareholder of Troika will own
4,200,000 shares of Blini Hut, or 46.6%. In addition, if the acquisition of
Troika were consumated, the beneficial ownership of Dimitri Gratchev and Max
Tanner would be reduced to 5.5% each.
CHANGES IN CONTROL
If the agreement to acquire Troika Foods, Inc. is consumated, Mr. Simon
Kublanov, a principle shareholder of Troika, will own 1,800,000 shares or 20% of
Blini Hut and Leonid Kuvykin, also a principle shareholder of Troika will own
4,200,000 shares of Blini Hut, or 46.6%.
ITEM 5-DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS
The following table sets forth certain information with respect to each
of the Directors, Executive Officers of the Company, their ages, and all
positions with the Company.
Name Age Position
___________________________ _______ ______________________________
Mont E. Tanner 36 President, Secretary/Treasurer
2920 North Green Valley Parkway Director
Building 3, Suite 321
Henderson, Nv 89014
Simon Kublanov (1) 58 President & CEO
2675 York Ave. #1614
NYC,NY 10128
Leonid Kuvykin (1) 49 Secretary/Treasurer
1222 Ave. Y
Brooklyn, NY 11235
____________________
(1) If Blini Hut is successful in acquiring Troika, Messrs Kublanov and
Kuvykin will be officers and directors as disclosed.
Mont E. Tanner, age 36, is Secretary/Treasurer and a director of the
Company. Mr. Tanner received a Bachelor of Arts degree from Brigham Young
University in 1985 and Juris Doctorate from the University of Idaho College
of Law in 1990. Mr. Tanner's law school honors and activities include a
University Langroise Scholarship from 1989 to 1990; and Student Writing
Editor of the Idaho Law Review. From 1985 to 1987, Mr.Tanner worked for
Concord Mortgage Corporation as a mortgage loan officer. Mr.Tanner worked as
a law clerk for the Law Offices of Marc S. Tanner in Boise, Idaho in the
summer of 1988 and the United States Department of the Interior in the Pacific
Northwest Region and as a Judicial Clerk in the Eighth Judicial District Court
for the District of Idaho-Chief Judge Harold Ryan in the summer of 1989. Mr.
Tanner was a Judicial Clerk for the Eighth Judicial District Court-Judge
Stephan Huffaker in Las Vegas, Nevada where he practiced general litigation,
estate planning, tax and pension law. Mr. Tanner has since opened his own
practice in Las Vegas, Nevada, practicing general litigation, estate planning,
tax and pension law.
Simon Kublanov, age 58, is president and co-founder of the Troika Food, Inc. Mr
Kublanov obtained a B.S. degree in economics and in Russian cuisine from the
University of Food Industry and Trade, St. Petersburg, Russia, in 1962. From
1993 to present, Mr. Kublanov was the founder of Da Pie, Russian Chef, and
Rush'n Express all of which have focused on Russian fast food. From 1984 to
1987, Mr. Kublanov founded "k's Fried Chicken". From 1962 to 1984 Mr. Kublanov
worked in a number of restaurants both in the U.S. and Russia in management and
chef capacities.
Leonid Kuvykin, age 49, is secretary, treasurer, director and co-founder
of Troika Food,Inc. Mr. Kuvykin received a B.S. in business administration and
an associates degree in Economics from the college of trade and marketing,
Ukraine. From October of 1997 to the present, Mr. Kuvykin also serves as a
member of the board to Russian Chef, Inc. Mr. Kuvykin from 1979 until 1987 has
been involved with several transportation businesses most of which were
franchise based. In 1979, Mr. Kuvykin immigrated to the United States from
Odessa, Ukraine where from 1971 until 1978 he held several management positions
in government owned food businesses.
FAMILY RELATIONSHIPS
Not applicable.
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
To the best of management's knowledge, during the past five years, no
present or former director or executive officer of the company:
(1) Has filed a petition under federal bankruptcy laws or any state
insolvency law, had a receiver, fiscal agent or similar officer appointed by a
court for the business or property of such person, or any partnership in which
he was a general partner at or within two years before the time of such filing,
or any corporation or business association of which he was an executive officer
at or within two years before the time of such filing;
(2) Was convicted in a criminal proceeding or named the subject of a
pending criminal proceeding (excluding traffic violations and other minor
offences);
(3) Was the subject of any order judgment or decree, not subsequently
reversed, suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining him from otherwise limiting his
involvement in any type of business, securities or banking activities; or
(4) Was found by a court of competent jurisdiction in a civil action,
by the Securities and Exchange Commodity Futures Trading Commission
to have violated any federal or state securities law.
ITEM 6-EXECUTIVE COMPENSATION
Any compensation received by officers or directors of the Company will be
determined from time to time by the board of Directors.
Name and Principal All other
Position Compensation Year
________________________ ___________ ________
Mont E.Tanner - Pres./Sec./Tres. 0 1999
Simon Kublanov - (1) 0 1999
Leonid Kuvykin -(2) 0 1999
________________
(1) to be president upon closing Troika acquisition
(2) to be sec./tres. upon closing Troika acquisition
OPTION/SAR GRANTS
None
AGGREGATE OPTIONS/SAR EXERCISES AND FISCAL YEAR END OPTION/SAR
VALUE TABLE
None
LONG TERM INCENTIVE PLANS
None
COMPENSATION OF DIRECTORS
None
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND
CHANGE OF CONTROL ARRANGEMENTS
None
ITEM 7 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Each of the officers and directors of the Company are engaged in other
businesses, either individually or through partnerships and corporations in
which they have an interest, hold an office or serve on boards of directors.Mont
Tanner is engaged in the full-time practice of law.
Certain conflicts of interest may arise between the Company and its
officers and directors. Mont Tanner has a conflict in devoting time to Company
matters because of his full-time law practice. Simon Kublanov and Leonid Kuvykin
have not taken on their respective positions as executive officers and directors
of the Company because the Troika acquisition has not yet closed. Messrs
Kublanov and Kuvykin are the owners and operators of Russian Chef, a privately
owned company which makes and distributes private labeled food for gourmet food
stores in New York City. Upon completing the acquisition of Troika, there may be
potential conflicts with Russian Chef in supplying food to gourmet food stores
as well as to Blini Hut's restaurants particularly should there be a shortage of
some food items. There may also be a conflict with the time in which messrs
Kublanov and Kuvykin have to devote to the Company as a result of their time
committment to Russian Chef.
The Company has retained one of the shareholders as legal counsel in
connection with the preparation of the offering memorandum for the May, 1995
securities offering and paid him $24,000 for those services and $5,000 for
other legal services rendered to the Company.
The Company retained one of its shareholders as legal counsel in connection
with the on going legal services required by the Company. The total amount
due for those services was $21,561 for the years 1995 and 1996. In December
of 1996, the Company issued to its shareholder 1,000,000 shares of common
stock as payment for those services. Those services were valued at
$.021561 per share or $21,561.
The Company retained one of its shareholders as legal counsel in connection
with a proposed securities offering and other legal matters during 1998. The
proposed securities offering was abandoned. The legal fees incurred by the
Company of $49,500 for preparation of the offering memorandum and other legal
services was paid by issuing 495,000 shares of its common stock for these
services which were valued at $.10 per share or $49,500.
The Company will attempt to resolve any such conflicts of interest in
favor of the Company. An attempt will be made to resolve any conflicts by
bringing such conflicts to the attention of independent board members or
advisors. In addition, any such conflicts may be raised at any annual or
special meeting of the Shareholders.
The officers and directors of the company are accountable to it and its
shareholders as fiduciaries, which requires that such officers and directors
exercise good faith and integrity in handling the Company's affairs. A
Shareholder may be able to institute legal action on behalf of the Company
or on behalf of itself and all other similarly situated shareholders to
recover damages or for other relief in cases of the resolution of conflicts
in any manner prejudicial to the Company.
TRANSACTIONS BETWEEN THE COMPANY AND MANAGEMENT
None
ITEM 8-LEGAL PROCEEDINGS
The Company is not a party to any material pending legal proceedings
and, to the best of its knowledge, no such action by or against the Company
has been threatened. None of the Company's officers, directors, or
beneficial owners of 5% or more of the Company's outstanding securities is a
party adverse to the Company nor do any of the foregoing individuals have
a material interest adverse to the Company.
ITEM 9-MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTER
MARKET INFORMATION
The Company's common stock is traded on the Pink Sheets under the symbol
"BHUT". The 52 week high is 6 1/2 and the 52 week low is 1/32. The approximate
last 90 day period from Aug 17, 1999 to November 10,1999 has a high of 6 1/2
and a low of 4 3/4.
STOCKHOLDERS
The Company's transfer agent, Silver State Registrar and Transfer
Corporation, confirms that as of September 9, 1999, there are approximately
300 shareholders of record for the Company including those shares held in
street name.
DIVIDENDS
The payment by the company of dividends, if any in the future, rests
within the discretion of its Board of Directors and will depend among other
things, upon the Company's earning, its capital requirements and its financial
condition, as well as other relevant factors. The company has not paid or
declared any dividends to date due to its present financial status.
ITEM 10 - RECENT SALES OF UNREGISTERED SECURITIES
On March 25, 1999, the company sold three million shares of common stock to
approximately thirty shareholders at $.03 per share pursuant to an Offering
Memorandum dated March 25, 1999. The shares were offered pursuant to an
exemption from Registration under Regulation D Rule 504.
The following is a list of shareholders who purchased in this offering:
Shareholder Date Type of Number of
Security Shares
_____________________________________________________________________________
Alexandre Bardeev 4/6/99 Common Stock 76,666
Natalia Belogourova 4/6/99 Common Stock 103,333
Nataliy Bobkova 4/6/99 Common Stock 70,000
Lidiy Butova 4/6/99 Common Stock 42,667
Dana Fedrova 4/6/99 Common Stock 33,333
Nataliya Gerasina 4/6/99 Common Stock 60,000
Tanya Gerosimeko 4/6/99 Common Stock 53,333
Irina Goncharova 4/6/99 Common Stock 116,667
Vadim Gratchev 4/6/99 Common Stock 16,666
Tamara Gratcheva 4/6/99 Common Stock 116,000
Viatchesiav, Ivanov 4/6/99 Common Stock 79,000
Andrey Kagramanov 4/6/99 Common Stock 100,000
Andrey Kuvichinsky 4/6/99 Common Stock 93,333
Maria Kuznetsova 4/6/99 Common Stock 65,666
Tatiana Lapina 4/6/99 Common Stock 116,667
Maxim Lavrov 4/6/99 Common Stock 38,333
Dimitry Nazarov 4/6/99 Common Stock 63,333
Alexandr Obukov 4/6/99 Common Stock 96,666
Margo Petrunina 4/6/99 Common Stock 53,333
Galina Ratner 4/6/99 Common Stock 63,666
Mark Ratner 4/6/99 Common Stock 70,000
Irina Romanova 4/6/99 Common Stock 83,333
Kapitolina Smirnova 4/6/99 Common Stock 75,000
Max Tanner 4/6/99 Common Stock 495,000
Viarkov Valeriy 4/6/99 Common Stock 80,000
Total Number of Investors: 25
On September 1, 1997, the Company sold Kristine Gornichec 50,000 shares
of common stock at $.01 per share pursuant to an exemption from Registration
under Section 4(2) of the Securities Act of 1933. After taking into account a
1 for 10 reverse stock split on April 10, 1998, these 50,000 shares are
currently only 5,000 shares.
ITEM 11-DESCRIPTION OF SECURITIES
The authorized capital stock of the Company consists of 10,000,000 Shares
of Common Stock. The holders of Common Stock (i) have equal ratable rights to
dividends from funds legally available therefore, when, as and if declared
by the Board of Directors of the Company; (ii) are entitled to share ratably
in all of the assets of the Company available for distribution or winding up
of the affairs of the Company; (iii) do not have preemptive subscription or
conversion rights and there are no redemption or sinking fund applicable
thereto; and (iv) are entitled to one non-cumulative vote per share, on all
matters which shareholders may vote on at all meetings of shareholders.
NON-CUMULATIVE VOTING
Holders of Shares of Common Stock of the Company do not have cumulative
voting rights which means that the holders of more than 50% of such outstanding
Shares, voting for the election of directors, can elect all of the directors
to be elected, if they so choose, and, in such event, the holders of the
remaining Shares will not be able to elect any of the Company's directors.
ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS
A. Indemnification provided by statute:
Sections 78.037, 78.295, 78.300, 78.7502, 78.751 and 78.752 of the Nevada
Revised Statutes offer limitation of liability protection for officers and
directors and/or indemnification protection of officers, directors, employees
and agents of the Company, and provide as follows:
NRS 78.037. Articles of incorporation: Optional provision. The articles of
incorporation may also contain:
1. A provision eliminating or limiting the personal liability of a
director or officer to the corporation or its stockholders for damages for
breach of fiduciary duty as a director or officer, but such a provision must
not eliminate or limit the liability of a director or officer for:
(a) Acts or omissions which involve intentional misconduct, fraud or
a knowing violation of the law; or
(b) The payment of distributions in violation of NRS 78.300.
2. Any provision, not contrary to the laws of this state, for the
management of the business and for the conduct of the affairs of the
corporation, and any provision creating, defining, limiting or regulating the
powers of the corporation or the rights, powers or duties of the directors, and
the stockholders, or any class of the stockholders, or the holders of bonds or
other obligations of the corporation, or governing the distribution or division
of the profits of the corporation.
NRS 78.295. Liability of directors for declaration of distributions. A director
is fully protected in relying in good faith upon the books of account of the
corporation or statements prepared by any of its officials as to the value and
other facts pertinent to the existence and amount of money from which
distributions may properly be declared.
NRS 78.300. Liability of directors for unlawful distributions.
1. The directors of a corporation shall not make distributions to
stockholders except as provided by this chapter.
2. In case of any willful or grossly negligent violation of the provisions
of this section, the directors under whose administration the violation
occurred, except those who caused their dissent to be entered upon the minutes
of the meeting of the directors at the time, or who not then being present
caused their dissent to be entered on learning of such action, are jointly and
severally liable, at any time within 3 years after each violation, to the
corporation, and, in the event of its dissolution or insolvency, to its
creditors at the time of the violation, or any of them, to the lesser of the
full amount of the distribution made or of any loss sustained by the
corporation by reason of the distribution to stockholders.
NRS 78.7502. Discretionary and mandatory indemnification of officers,
directors, employees and agents: General provisions.
1. A corporation may indemnify any person who was or is a party of is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative,
except an action by or in the right of the corporation, by reason of the fact
that he is or was a director, officer, employee or agent of the corporation,
or is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses,including attorneys fees, judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with the action, suit or proceeding if he acted in good faith and in
a manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent, does not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and that, with respect to any criminal action or
proceeding, he had reasonable cause to believe that his conduct was unlawful.
2. A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action
or suit by or in the right of the corporation to procure a judgment in its
favor by reason of the fact that he is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses,
including amounts paid in settlement and attorneys fees actually and
reasonably incurred by him in connection with the defense or settlement of
the action or suit if he acted in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation. Indemnification may not be made for any claim, issue of matter
as to which such a person has been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals therefrom, to be liable to
the corporation or for amounts paid in settlement to the corporation,
unless and only to the extent that the court in which the action or suit
was brought or other court of competent jurisdiction determines upon
application that in view of all the circumstances of the case, the person
is fairly and reasonably entitled to indemnity for such expenses as the
court deems proper.
3. To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections 1 and 2, or in defense of
any claim, issue or matter therein, the corporation shall indemnify him against
expenses, including attorneys fees, actually and reasonably incurred by him
in connection with the defense.
NRS 78.751. Authorization required for discretionary indemnification;
advancement of expenses; limitation on indemnification and advancement of
expenses.
1. Any discretionary indemnification under NRS 78.7502 unless ordered by
a court or advanced pursuant to subsection 2, may be made by the corporation
only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is proper in the
circumstances. The determination must be made:
(a) By the stockholders;
(b) By the board of directors by majority vote of a quorum
consisting of directors who were not parties to the action, suit
or proceeding;
(c) If a majority vote of a quorum consisting of directors
who were not parties to the action, suit or proceeding so orders, by
independent legal counsel in a written opinion; or
(d) If a quorum consisting of directors who were not
parties to the action, suit or proceeding cannot be obtained, by
independent legal counsel in a written opinion.
2. The articles of incorporation, the bylaws or an agreement made by the
corporation may provide that 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. The provisions of this subsection do not
affect any rights to advancement of expenses to which corporate personnel
other than directors or officers may be entitled under any contract or
otherwise by law.
3. The indemnification and advancement of expenses authorized in or
ordered by a court pursuant to this section:
(a) Does not exclude any other rights to which a person
seeking indemnification or advancement of expenses may be entitled
under the articles of incorporation or any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, for either an
action in his official capacity or an action in another capacity
while holding his office, except that indemnification, unless ordered
by a court pursuant to NRS 78.7502 or for the advancement of expenses
made pursuant to subsection 2, may not be made to or on behalf of
any director or officer if a final adjudication establishes that his
acts or omissions involved intentional misconduct, fraud or a knowing
violation of the law and was material to the cause of action.
(b) Continues for a person who has ceased to be a director,
officer, employee or agent and inures to the benefit of the heirs,
executors and administrators of such a person.
NRS 78.752. Insurance and other financial arrangements against liability of
directors, officers, employees and agents.
1. A corporation may purchase and maintain insurance or make other
financial arrangements on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise for
any liability asserted against him and liability and expenses incurred by him
in his capacity as a director, officer, employee or agent, or arising out of
his status as such, whether or not the corporation has the authority to
indemnify him against such liability and expenses.
2. The other financial arrangements made by the corporation pursuant to
subsection 1 may include the following:
(a) The creation of a trust fund.
(b) The establishment of a program of self-insurance.
(c) The securing of its obligation of indemnification by
granting a security interest or other lien on any assets of the
corporation.
(d) The establishment of a letter of credit, guaranty or
surety.
No financial arrangement made pursuant to this subsection may provide
protection for a person adjudged by a court of competent jurisdiction,
after exhaustion of all appeals therefrom, to be liable for intentional
misconduct, fraud or a knowing violation of law, except with respect to
the advancement of expenses or indemnification ordered by a court.
3. Any insurance or other financial arrangement made on behalf of a person
pursuant to this section may be provided by the corporation or any other person
approved by the Board of Directors, even if all or part of the other person
stock or other securities is owned by the corporation.
4. In the absence of fraud:
(a) The decision of the board of directors as to the
propriety of the terms and conditions of any insurance or other
financial arrangement made pursuant to this section and the choice of
the person to provide the insurance or other financial arrangement is
conclusive; and
(b) The insurance or other financial arrangement:
(1) Is not void or voidable; and
(2) Does not subject any director approving it to
personal liability for his action, even if a director approving
the insurance or other financial arrangement is a beneficiary of
the insurance or other financial arrangement.
5. A corporation or its subsidiary which provides self-insurance for
itself or for another affiliated corporation pursuant to this section is not
subject to the provisions of Title 57 of NRS.
B. Indemnification provided by the Articles of Incorporation
The NINTH article of the Company's Articles of Incorporation limits the
liability exposure of officers and directors of the Company for damages. It
provides as follows: No director or officer of the Corporation shall be
personally liable to the Corporation or any of its stockholders for damages
for breach of fiduciary duty as a director or officer involving any act or
omission of any such director of officer; provided however, that the foregoing
provision shall not eliminate or limit the liability or a director or officer
(i) for acts or omissions which involve intentional misconduct, fraud or a
knowing violation of law, or (ii) the payment of dividends in violation of
Section 78.300 of the Nevada Revised Statutes. 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 of omissions prior to such
repeal or modification.
C. Indemnification provided by the By-Laws of the Company
Article VII, INDEMNIFICATION, of the Company's By-Laws provides for the
following indemnification protections: Except as hereinafter stated
otherwise, the Corporation shall indemnify all of its officers and directors,
past, present and future, against any and all expenses incurred by them, and
each of them including but not limited to legal fees, judgments and penalties
which may be incurred, rendered or levied in any legal action brought against
any or all of them for or on account of any act or omission alleged to have
been committed while acting within the scope of their duties as officers or
directors of this Corporation.
As of the date hereof, the Company has no contracts in effect providing any
indemnitee with any specific rights of indemnification although the Company's
bylaws authorize its Board of Directors to enter into and deliver such
contracts to provide an indemnitee with specific rights of indemnification in
addition to the rights provided in the Articles and Bylaws to the fullest
extent provided under Nevada law. The Company has no special insurance
against liability although the Company's Bylaws provide that the Company may,
unless prohibited by Nevada law, maintain such insurance.
ITEM 13. FINANCIAL STATEMENTS
BLINI HUT, INC. & TROIKA FOOD, INC.
(DEVELOPMENT STAGE COMPANIES)
PROFORMA BALANCE SHEET
SEPTEMBER 30, 1999
Assets
Cash $80,237
Deferred Offering Costs $19,000
Organizational Costs less accumulated
amortization of $570 430
-------
Total Assets $99,667
=======
Liabilities & Stockholders' Equity
Liabilities
Accounts Payable $350
Advances from Shareholder $1500
--------
Total Liabilities $1850
------
Stockholders' Equity
Common Stock - Authorized 10,000,000 shares
at $.01 par value, issued and outstanding 9,508,461 950,843
Additional Paid-In Capital 909,277
Deficit accumulated during the development stage (1,762,303)
-------------
97,817
----------
Total Liabilities and Stockholders' Equity $99,667
NOTE A: The proforma balance sheet shows a consolidation of Troika Food, Inc.
with Blini Hut, Inc. as of September 30, 1999.
<PAGE>
TROIKA FOOD, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
sEPTEMBER 30, 1999
(UNAUDITED)
Assets
Cash $437
Deferred Offering Costs $19,000
Organizational Costs less accumulated
amortization of $128 372
-------
Total Assets $19,809
========
Liabilities & Stockholders' Equity
Liabilities
Advances from Shareholder $1500
Stockholders' Equity
Common Stock - Authorized 4,000,000 shares
at $.01 par value, issued and outstanding 1,000,000 10,000
Preferred Stock - authorized 1,000,000 shares
at $.01 par value
Additional Paid-In Capital 90,000
Deficit accumulated during the development stage (81,691)
-------------
Total Stockholders' Equity $18,309
----------
Total Liabilities and Stockholders' Equity $19,809
=========
<PAGE>
TROIKA FOOD, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF LOSS AND STOCKHOLDERS'DEFICIT
FOR THE NINE MONTHS ENDED SEPTEMBER 30,1999 FROM MAY 1998
(INCEPTION) TO SEPTEMBER 30, 1999
(UNAUDITED)
Cumulative during
development stage
-----------------
Revenues $0 $0
Operating Expenses
Rent $76,500 76,500
Development Costs 4,907 4,907
Miscellaneous expenses 284 228
-------- ------
Total Operating Expenses 81,691 81,635
----- ------
Net Loss (81,691) (81,635)
=========
Retained Deficit - January 1,1999 (56)
Retained Deficit - September 30, 1999 (81,691)
==========
<PAGE>
TROIKA FOOD INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENT
SEPTEMBER 30, 1999
(UNAUDITED)
History: The Company was incorporated in Deleware on May 15, 1998. To date,
there has been no operations. However, the Company is in negotiations to merge
with a public entity in a tax free exchange.
Deferred Offering Costs: The Company has incurred costs in discussions on the
merger with Blini Hut,Inc. Upon the completion of the transaction, these costs
will be written off to stockholders' equity.
Lease: The Company has entered into a 10 year lease for its premises. The future
rental payments will be as follows on a calendar year basis.
2000 - $102,255
2001 - $105,323
2002 - $108,486
2003 - $111,735
subsequent to 2003 $733,019
-------
TOTAL $1,160,818
===========
The Company commenced paying rent in January 1999, with the first seven months
of rent being waived by the landlord.
<PAGE>
November 10, 1999
The enclosed statements have been prepared by me.
/s/ Simon Kublanov, President
Simon Kublanov, President
Troika Food, Inc.
Note: This is in reference to the unaudited Troika Food financial statements
<PAGE>
BLINI HUT, INC.
(FORMERLY BARGAIN PRODUCTS)
(A DEVELOPMENTAL STAGE COMPANY)
FINANCIAL STATEMENTS
September 30, 1999
(unaudited)
<PAGE>
Table of Contents
Page Number
FINANCIAL STATEMENT
Balance Sheet.................................... 1
Statement of Operations and Equity
Accumulated During the Development Stage........ 2
Statement of Changes in Stockholders............ 3
Statement of Cash Flows......................... 4
Notes to the Financial Statements............... 5
<PAGE>
BLINI HUT, INC.
(A DEVELOPMENTAL STAGE COMPANY)
BALANCE SHEETS
September 30, 1999
(unaudited)
Sept. 30, Sept 30,
1999 1999
---------- ---------
ASSETS
Cash $79,800 $164
Organizational costs less accumulated
amortization of $442 50 150
________ _______
Total Assets $79,800 164
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY
Accounts Payable $350 $100
---- -----
Total Liabilities $350 $100
Stockholders Equity
Common stock, authorized 10,000,000 shares
at $.10 par value, issued and outstanding
3,508,461 shares 50,843
Additional paid-in capital $80,843
Deficit Accumulated during the $1,679,277 1,629,676
developmental stage (1,680,620) (1,680,305)
----------- -----------
Total Stockholder's Equity 79,500 214
Total Liabilities and Stockholder's Equity $79,858 314
========= =====
The accompanying notes are an integral part of these financial statements.
-1-
<PAGE>
BLINI HUT, Inc.
(A DEVELOPMENTAL STAGE COMPANY)
STATEMENT OF OPERATIONs AND DEFICIT
(Unaudited)
January 1, 1999 January 1, 1998
to September 30, 1999 to September 30, 1998
--------------------- ------------------
Income $ 0 $ 0
Expenses
Amortization 75 75
Bank Charges 10 194
Office Expenses 140 0
Legal 0 49,500
---- -------
Total operating expenses 225 49,769
Net loss (225) (49,769)
Retained Earnings (1,680,395) (1,630,536)
------------ -----------
Deficit accumulated during
the developmental stage $ (1,680,620) (1,680,305)
============= ==========
The accompanying notes are an integral part of these financial statements.
-2-
<PAGE>
BLINI HUT, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
PERIOD From April 6, 1995 (date of inception)
(unaudited)
Additional
Common Stock paid-in
Shares Amount Capital Total
(adjusted for
stock splits)
-------- ---------- ----------- ----------
Issuance of common
stock for cash 2,600 $ 2,600 147,500 $ 150,100
Issuance of common
stock for stock 4,828 4,828 0 4,828
Contributed Capital 0 0 1,255,600 1,255,600
Less Offering Costs 0 0 (30,070) (30,070)
Net Loss 0 0 0 (1,386,670)
---------- --------- --------- ------------
Balance,
December 31, 1995 7,428 7,428 1,373,030 (6,212)
Issuance of Common
stock for services 1,000 1,000 20,561 21,561
Contributed Capital 0 0 224,000 224,000
Net Loss 0 0 0 (238,573)
--------- ------- --------- -----------
Balance,
December 31, 1996 8,428 8,428 1,617,591 776
Reverse Stock Split
100 to 1 8,344 0 0 0
Issuance of Common
Stock for cash 5,000 5,000 0 5,000
Net Loss 0 0 0 (5,293)
--------- --------- ------ ---------
Balance
December 31, 1997 134,295 13,428 1,617,591 483
Reverse Stock Split
10 t0 1 (120,834) (12,085) 12,085 0
Issuance of common
stock for services 495,000 49,500 0 49,500
Net loss 0 0 0 (49,858)
--------- --------- ----- -----------
Balance
December 31, 1998 508,461 50,843 1,629,676 125
Net Loss 0 0 0 (225)
Less Offering Costs 0 0 (10,400) (10,400)
Issuance of common
stock for cash 3,000,000 30,000 60,000 90,000
--------- --------- ----- -----------
Balance
September 30,1999 $3,508,461 $ 80,843 $ 1,679,277 $ 79,500
========= ======= ======== =======
the accompanying notes are an integral part of these financial statements.
-3-
<PAGE>
BLINI HUT, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
(Unaudited)
January 1, 1999 Jan. 1 1998
to Sept. 30 1999 to Sept. 30, 1998
------------------- -----------------
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES
Net Loss $ (225) $ (49,769)
Noncash items included in net loss
amortization 75 75
Stock issued for legal services 0 49,500
Increase in accounts payable 250 100
---- ------
NET CASH PROVIDED BY
OPERATING ACTIVITIES 100 (94)
CASH FLOWS USED BY INVESTING ACTIVITIES 0 0
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock 30,000 0
Additional paid-in capital 60,000 0
Less offering costs (10,400) 0
--------- ---------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 79,600 0
NET INCREASE IN CASH 79,700 (94)
-----
CASH AT BEGINNING OF PERIOD 100 258
--------- ------
CASH AT END OF PERIOD $79,800 $164
The accompanying notes are an integral part of these financial statements.
-4-
<PAGE>
BLINI HUT, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
September 30, 1999
NOTES TO THE FINANCIAL STATEMENTS
Blini Hut, Inc., (formerly Bargain Products, Inc.) (the Company) has
elected to omit substantially all footnotes to the financial statements for the
nine months ended September 30, 1999 and September 30, 1998. The share
information in the Statement to Changes in Stockholder's Equity has been
revised retroactively to take into account a 1 for 100 reverse stock split on
July 29, 1999 and a 1 for 10 reverse stock split on April 10, 1998.
UNAUDITED INFORMATION
The information furnished herein was taken from the books and records of
the Company without audit. However, such information reflects all adjustments
which are, in the opinion of management, necessary to properly reflect the
results of the period presented. The information presented is not necessarily
indicative of the results from operations expected for the full fiscal years.
NAME CHANGE
On May 6, 1999, the Company changed its name from "Bargain Products, Inc."
to "Blini Hut, Inc."
<PAGE>
AUDITED FINANCIAL STATEMENTS
BARGAIN PRODUCTS, INC.
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
December 31, 1998
<PAGE>
TABLE OF CONTENTS
Page Number
-----------
ACCOUNTANT'S REPORT........................................1
FINANCIAL STATEMENT:
Balance Sheet.........................................2
Statement of Operations and Deficit
Accumulated During the Development Stage..............3
Statement of Changes in Stockholders' Equity..........4
Statement of Cash Flows...............................5
Notes to the Financial Statements....................6-8
<PAGE>
DAVID E. COFFEY 3651 Lindell Rd. - Suite H Las Vegas, NV 89103
CERTIFIED PUBLIC ACCOUNTANT (702) 871-3979
To the Board of Directors and Stockholders of
Bargain Products, Inc.
Las Vegas, Nevada
I have audited the accompanying balance sheet of Bargain Products, Inc.
(a development stage company) as of December 31, 1998 and the related
statements of operations, changes in stockholders' equity and cash flows
for the period from April 6, 1995 (date of inception) to December 31, 1998.
These financial statements are the responsibility of Bargain Products Inc.'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
audited standards. Those standards require that I 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 of the
financial statements provide a reasonable basis for my opnion.
In my opinion, the accompanying financial statements present fairly, in
all material respects, the financial position of Bargain Products, Inc. as of
December 31, 1998 and the results of operations, cash flows and changes in
stockholders' equity for the year then ended in conformity with generally
accepted accounting principles.
/s/ DAVID COFFEY C.P.A.
David Coffey C.P.A.
Las Vegas, Nevada
April 7, 1999
<PAGE>
BARGAIN PRODUCTS, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
December 31, 1998
ASSETS
Cash $ 100
Organizational costs less accumulated
amortization of $375 125
-----
Total Assets $ 225
=====
LIABILITIES & STOCKHOLDERS' EQUITY
Accounts payable $ 100
-----
Total Liabilities 100
Stockholders' Equity
Common stock, authorized 10,000,000 shares
at $.10 par value, issued and outstanding
508,461 shares 50,843
Additional paid-in capital 1,629,676
Deficit accumulated during the
development stage (1,680,394)
-----
Total Stockholders' Equity 125
Total Liabilities and Stockholders' Equity $ 225
=====
The accompanying notes are an integral part of
these financial statements.
-2-
<PAGE>
BARGAIN PRODUCTS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS AND DEFICIT
ACCUMULATED DURING THE DEVELOPMENT STAGE
FOR THE YEAR ENDED December 31, 1998
(With Cumulative Figures From Inception)
From Inception
January 1, 1998 April 6, 1995
To December 31, 1998 To Dec. 31, 1998
----------------- ----------------
Income $ 0 $ 0
Expenses
Amortization 100 375
Bank Charges 258 1,278
Consulting 0 216,200
Licenses 0 85
Legal 49,500 93,477
Travel 0 500
Write off of investment in
wholly owned subsidiary;
stock 0 4,828
capital contributions 0 1,363,651
----- --- -----
Total expenses 49,858 1,680,394
Net loss (49,858)
------
net loss (49,858)
Retained earnings,
beginning of period (1,630,536)
----------
Deficit accumulated during
the development state $(1,680,394)
===========
The accompanying notes are an integral part of these financial statements.
-3-
<PAGE>
BARGAIN PRODUCTS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
PERIOD FROM April 6, 1995 (Date of Inception)
To December 31, 1998
Additional
Common Stock Paid-in
Shares Amount Capital Total
---------- ------ ------- -----
Issuance of common
stock for cash 100,000 $ 100 $ 0 $ 100
Issuance of common
stock for cash 2,500,000 2,500 147,500 150,000
Issuance of common
stock for stock 4,828,571 4,828 0 4,828
Contributed capital 0 0 1,255,600 1,255,600
Less offering costs 0 0 (30,070) (30,070)
Net loss 0 0 0 (1,386,670)
--------- ----- --------- ---------
December 31, 1993 7,428, 571 7,428 1,373,030 (6,212)
Issuance of common
stock for services 1,000,000 1,000 20,561 21,561
Contributed capital 0 0 224,000 224,000
Less net loss 0 0 0 (238,573)
--------- ------ ------- -------
Balance,
December 31, 1996 8,428,571 8,428 1,617,591 776
Reverse stock split
100 to 1 (8,344,276) 0 0 0
Issuance of common
stock for cash 50,000 5,000 0 5,000
Net loss 0 0 (5,293)
-------- ----- ----- -----
Balance,
December 31, 1997 134,295 13,428 1,617,591 483
Reverse stock split
10 to 1 (120,834) (12,085) 12,085 0
Issuance for common
stock for services 495,000 49,500 0 0
Net loss 0 0 0 (49,858)
--------- ----- ----- -----
Balance,
December 31, 1998 508,461 $ 50,843 $ 1,629,676 $ 125
======= ====== ========= ===
The accompanying notes are an integral part of
these financial statements.
-4-
<PAGE>
BARGAIN PRODUCTS, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED December 31, 1998
(With Cumulative Figures Fom Inception)
From Inception,
Year ended April 6, 1995
December 31, 1998 To Dec. 31, 1998
----------------- ----------------
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES
Net loss $ (49,858) $ (1,680,394)
Noncash expenses included in net loss
Amortization 100 375
Stock issued for legal services 49,500 76,061
Write off stock in
wholly owned subsidiary 0 4,828
Increase in accounts payable 100 100
------ ---------
NET CASH USED BY
OPERATING ACTIVITIES (158) (1,599,030)
CASH FLOWS USED BY INVESTING ACTIVITIES
Organizational costs 0 500
----- ---
NET CASH USED BY
INVESTING ACTIVITIES 0 5400
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock 0 2,600
Additional paid-in capital 0 1,627,100
Less offering costs 0 (30,070)
------ ------
NET CASH PROVIDED BY
FINANCING ACTIVITY 0 1,599,630
NET INCREASE IN CASH (158) $ 100
===
CASH AT BEGINNING OF PERIOD 258
---
CASH AT END OF PERIOD $ 100
===
Supplemental disclosures of cash flow information:
Issuance of common stock in exchange
for services 49,500 $ 71,061
====== ======
The accompanying notes are an integral part of
these financial statements.
-5-
<PAGE>
BARGAIN PRODUCTS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
NOTE A SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company was incorporated on April 6, 1995 under
the laws of the state of Nevada. The business purpose of
Company is to engage in retail sales of low cost consumer
products at the retail level.
The Company will adopt accounting policies and procedures
based upon the nature of future transactions.
NOTE B ORGANIZATION COSTS
Organization costs are capitalized and amortized over 60
months.
NOTE C OFFERING COSTS
The offering costs which were incurred by the Company in
connection with the public stock offering were deducted
from the net proceeds of that offering.
NOTE D WHOLLY OWNED SUBSIDIARY
The Company entered into an agreement on June 20, 1995 to
exchange 4,828,571 shares of its common stock to acquire 25,000 shares
of common stock in Dollar Mania, Inc., a Nevada corporation. After
this exchange, Dollar Mania, Inc. became a wholly owned subsidiary of
Bargain Products, Inc. On March 28, 1996, the wholly owned subsidiary
filed for protection under the bankruptcy laws in the State of Nevada.
In December of 1996, the Company abandoned the 25,000 shares of common
stock in Dollar Mania, Inc., its wholly owned sdubsidiary, to the
trustees in the bankruptcy proceedings and there by disposed of the
wholly owned subsidiary. The cost of the stock was written off as an
extraordinary item in the amount of $4,828.
NOTE E PUBLIC STOCK OFFERING
In may of 1995, a public stock offering was made and the
net proceedws of that offering will be used for the purpose
of engaging in retail sales of low cost consumer products
at the retail level. The Company sold 2,500,000 shares of
the common stock for $150,000.
-6-
<PAGE>
BARGAIN PRODUCTS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
NOTE F CAPITAL CONTRIBUTIONS TO WHOLLY OWNED SUBSIDIARY
On March 28, 1996 Dollar Mania, Inc. filed for protection
under the bankruptcy laws in the State of Nevada. All of
the capital contributions made in 1995 and 1996, in the
amount of $1,363,651 were written off as an extraordinary
item.
NOTE G RELATED PARTY TRANSACTIONS
The Company has retained one of the shareholders as legal
counsel in connection with the preparation of the offering
memorandum for the May, 1995 securities offering and paid
him $24,000 for those services and $5,000 for other legal
services rendered to the Company.
The Company retained one of its shareholders as legal
counsel in connection with the on going legal services
required by the Company. The total amount due for those
services was $21,561 for the years 1995 and 1996. In
December of 1996, the Company issued to its shareholder
1,000,000 shares of common stock as payment for those
services. Those services were valued at $.021561 per share
or $21,561.
The Company retained one of its shareholders as legal
counsel in connection with a proposed securities offering
and other legal matters during 1998. The proposed
securities offering was abandoned. The legal fees incurred
by the company of $49,500 for preparation of the offering
memorandum and other legal services was paid by issuing
495,000 shares of its common stock for these services which
were valued at $.10 per share of $49,500 in addition to the
$5,000 referenced above.
NOTE H REVERSE STOCK SPLIT
On July 15, 1997, the Company approved a one for one hundred
reverse stock split of the common stock, decreasing the
authorized common stock from 25,000,000 shares, $.001 par
value per share to 250,000 shares of common stock, $.10 par
value. There were 8,428,571 shares of common stock issued
and outstanding before the reverse stock split and 84,295
after the reverse stock split. The company raised the
authorized common stock to 10,000,000 shares effective July
29, 1997.
-7-
<PAGE>
BARGAIN PRODUCTS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
NOTE I PRIVATE STOCK PLACEMENT
In December of 1997, the Company sold 50,000 shares of its
common stock for $.10 per share or $5,000. The proceeds
were used to pay legal expenses of the Company.
NOTE J REVERSE STOCK SPLIT
On April 10, 1998 the Company approved a one for ten
reverse stock split of the common stock, decreasing the
authorized common stock from 10,000,000 shares, $.001 par
value per share to 1,000,000 shares of common stock, $.10
par value. There were 134,295 shares of common stock issued
and outstanding before the reverse stock split and 13,429
after the reverse stock split. The Company raised the
authorized common stock to 10,000,000 shares effective May
2, 1998.
On March 24, 1999, the company amended its articles of
incorporation to change the par value of its common
stock from $.10 to $.01 per share. In March of 1999, the
Company approved a securities offering of 3,000,000 shares
of its common stock to be sold at $.03 per share.
ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND
FINANCIAL DISCLOSURE
The Company has used the same independent accountant since its inception
in April of 1995 and has not had any disagreements with said independent
accountant.
ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS
(a) The Company's financial statements for the period from inception to
December 31, 1998 are included herein under Item 13 of this Registration
Statement.
(b) The following exhibits are furnished as required by Item 601 of Regulation
S-B.
Exhibit No. Description
3.0 Certificate of Incorporation of Bargain Products, Incorporated
consisting of Articles of Incorporation filed with the Secretary
of State of the State of Nevada on April 6, 1995, filed with
SEC in this Registration Statement.
3.1 By-Laws of Bargain Products, Incorporated, dated April 6, 1995 ,
are attached hereto, filed with SEC in this Registration
Statement.
3.2 Amendment to the Articles of Incorporation, dated July 15, 1997.
3.3 Amendment to the Articles of Incorporation, dated April 16, 1998.
3.4 Amendment to the Articles of Incorporation, dated May 11, 1999.
4.0 Common Stock certificate, filed with SEC in this Registration
Statement.
10.0 Stock for Stock Agreement between Troika Food, Inc. & Blini Hut
27.0 Financial Data Schedule for the period ending 12/31/98, filed
with the SEC in this Registration Statement.
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant has caused this registration statement to be signed on its behalf
by the undersigned, thereunto duly authorized.
Bargain Products, Inc.
(Registrant)
Date: November 10, 1999 By: /s/Mont Tanner
--------------------------------
President and Director
CERTIFICATE
I, DEAN HELLER, Secretary of State of the State of Nevada, do hereby certify
that BARGAIN PRODUCTS, INC. did on the SIXTH day of APRIL, 1995, file in this
office the original Articles of Incorporation; that said Articles are now on
file and of record in the office of the Secretary of State of Nevada, and
further, that said Articles contain all the provisions required by the law
of said State of Nevada.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Great Seal of
State, at my office in Carson City, Nevada, this SIXTH day of APRIL,
A.D. 1995.
/s/ DEAN HELLER
Secretary of state
By
/s/ DEANNA MARGUEW
Certification Clerk
[Filed stamped as follows: "Filed in the office of the Secretary
of State of the State of Nevada, April 6, 1995]
ARTICLES OF INCORPORATION
OF
BARGAIN PRODUCTS,INC.
KNOW ALL MEN BY THESE PRESENTS:
That we, the undersigned, have this day voluntarily associated ourselves
together for the purpose of forming a Corporation under and pursuant to the
laws of the State of Nevada, and we do hereby certify that:
ARTICLE I - NAME: The exact name of this Corporation is:
Bargain Products, Inc.
ARTICLE II - RESIDENT AGENT:
The Resident Agent of the Corporation is Max C. Tanner,Esq., The
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Law Offices of Max C. Tanner, 2950 East Flamingo Road, Suite G, Las Vegas,
Nevada 89121.
ARTICLE III - DURATION: The Corporation shall have perpetual existence.
ARTICLE IV - PURPOSES: The purpose, object and nature of the business for
which this Corporation is organized are:
(a) To engage in any lawful activity;
(b) To carry on such business as may be necessary, convenient, or
desirable to accomplish the above purposes, and to do all other
things incidental thereto which are not forbidden by law or by
these Articles of Incorporation.
ARTICLE V - POWERS: The powers of the Corporation shall be those powers
granted by 78.060 and 78.070 of the Nevada Revised Statutes under which this
corporation is formed. In addition, the Corporation shall have the following
specific powers:
(a) To elect or appoint officers and agents of the Corporation and
to fix their compensation;
(b) To act as an agent for any individual, association, partnership,
corporation or other legal entity;
(c) To receive, acquire, hold, exercise rights arising out of the
ownership or possession thereof, sell, or otherwise dispose of,
shares or other interests in, or obligations of, individuals,
associations, partnerships, corporations, or governments;
(d) To receive, acquire, hold, pledge, transfer, or otherwise
dispose of shares of the corporation, but such shares may only
be purchased, directly or indirectly, out of earned surplus;
(e) To make gifts or contributions for the public welfare or for
charitable, scientific or educational purposes, and in time of
war, to make donations in aid of war activities.
ARTICLE VI - CAPITAL STOCK:
Section 1. Authorized Shares. The total number of shares which this
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Corporation is authorized to issue is 25,000,000 shares of Common Stock
at $.001 par value per share.
Section 2. Voting Rights of Shareholders. Each holder of the Common
Stock shall be entitled to one vote for each share of stock standing in
his name on the books of the Corporation.
Section 3. Consideration for Shares. The Common Stock shall be issued
for such consideration, as shall be fixed from time to time by the Board
of Directors. In the absence of fraud, the judgment of the Directors as
to the value of any property for shares shall be conclusive. When
shares are issued upon payment of the consideration fixed by the Board
of Directors, such shares shall be taken to be fully paid stock and
shall be non-assessable. The Articles shall not be amended in this
particular.
Section 4. Pre-emotive Rights. Except as may otherwise be provided by
the Board of Directors, no holder of any shares of the stock of the
Corporation, shall have any preemptive right to purchase, subscribe for,
or otherwise acquire any shares of stock of the Corporation of any class
now or hereafter authorized, or any securities exchangeable for or
convertible into such shares, or any warrants or other instruments
evidencing rights or options to subscribe for, purchase, or otherwise
acquire such shares.
Section 5. Stock Rights and Options. The Corporation shall have the
power to create and issue rights, warrants, or options entitling the
holders thereof to purchase from the corporation any shares of its
capital stock of any class or classes, upon such terms and conditions
and at such times and prices as the Board of Directors may provide,
which terms and conditions shall be incorporated in an instrument or
instruments evidencing such rights. In the absence of fraud, the
judgment of the Directors as to the adequacy of consideration for the
issuance of such rights or options and the sufficiency thereof shall be
conclusive.
ARTICLE VII - ASSESSMENT OF STOCK: The capital stock of this Corporation,
after the amount of the subscription price has been fully paid in, shall not
be assessable for any purpose, and no stock issued as fully paid up shall
ever be assessable or assessed. The holders of such stock shall not be
individually responsible for the debts, contracts, or liabilities of the
Corporation and shall not be liable for assessments to restore impairments in
the capital of the Corporation.
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ARTICLE VIII - DIRECTORS: For the management of the business, and for the
conduct of the affairs of the Corporation, and for the future definition,
limitation, and regulation of the powers of the Corporation and its directors
and shareholders, it is further provided:
Section 1. Size of Board. The members of the governing board of the
Corporation shall be styled directors. The number of directors of the
Corporation, their qualifications, terms of office, manner of election,
time and place of meeting, and powers and duties shall be such as are
prescribed by statute and in the by-laws of the Corporation. The name
and post office address of the directors constituting the first board of
directors, which shall be Two (2) in number are:
NAME ADDRESS
Terry Fields 2115 Main Street
Santa Monica, California
90405
Ron Drake 2950 East Flamingo Road
Suite F
Las Vegas, Nevada 89121
Section 2. Powers of Board. In furtherance and not in limitation of
the powers conferred by the laws of the State of Nevada, the Board of
Directors is expressly authorized and empowered:
(a) To make, alter, amend, and repeal the By-Laws subject to the
power of the shareholders to alter or repeal the By-Laws made by
the Board of Directors.
(b) Subject to the applicable provisions of the ByLaws then in
effect, to determine, from time to time, whether and to what
extent, and at what times and places, and under what conditions
and regulations, the accounts and books of the Corporation, or
any of them, shall be open to shareholder inspection. No
shareholder shall have any right to inspect any of the accounts,
books or documents of the Corporation, except as permitted by
law, unless and until authorized to do so by resolution of the
Board of Directors or of the Shareholders of the Corporation;
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(c) To issue stock of the Corporation for money, property, services
rendered, labor performed, cash advanced, acquisitions for other
corporations or for any other assets of value in accordance with
the action of the board of directors without vote or consent of
the shareholders and the judgment of the board of directors as to
value received and in return therefore shall be conclusive and
said stock, when issued, shall be fully-paid and non-assessable.
(d) To authorize and issue, without shareholder consent, obligations
of the Corporation, secured and unsecured, under such terms and
conditions as the Board, in its sole discretion, may determine,
and to pledge or mortgage, as security therefore, any real or
personal property of the Corporation, including after-acquired
property;
(e) To determine whether any and, if so, what part, of the earned
surplus of the Corporation shall be paid in dividends to the
shareholders, and to direct and determine other use and
disposition of any such earned surplus;
(f) To fix, from time to time, the amount of the profits of the
Corporation to be reserved as working capital or for any other
lawful purpose;
(g) To establish bonus, profit-sharing, stock option, or other types
of incentive compensation plans for the employees, including
officers and directors, of the Corporation, and to fix the amount
of profits to be shared or distributed, and to determine the
persons to participate in any such plans and the amount of
their respective participations.
(h) To designate, by resolution or resolutions passed by a majority
of the whole Board, one or more committees, each consisting of
two or more directors, which, to the extent permitted by law and
authorized by the resolution or the By-Laws, shall have and may
exercise the powers of the Board;
(i) To provide for the reasonable compensation of its own members by
By-Law, and to fix the terms and conditions upon which such
compensation will be paid;
(j) In addition to the powers and authority herein before, or by
statute, expressly conferred upon it, 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, subject,
nevertheless, to the provisions of the laws of the State of
Nevada, of these Articles of Incorporation, and of the By-Laws
of the Corporation.
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Section 3. Interested Directors. No contract or transaction between
this Corporation and any of its directors, or between this Corporation
and any other corporation, firm, association, or other legal entity
shall be invalidated by reason of the fact that the director of the
Corporation has a direct or indirect interest, pecuniary or otherwise,
in such corporation, firm, association, or legal entity, or because the
interested director was present at the meeting of the Board of Directors
which acted upon or in reference to such contract or transaction, or
because he participated in such action, provided that: (1) the
interest of each such director shall have been disclosed to or known by
the Board and and a disinterested majority of the Board shall have
nonetheless ratified and approved such contract or transaction (such
interested director or directors may be counted in determining
whether a quorum is present for the meeting at which such ratification
or approval is given); or (2) the conditions of N.R.S. 78.140 are met.
ARTICLE IX - LIMITATION OF LIABILITY OF OFFICERS OR DIRECTORS:
The personal liability of a director or officer of the corporation to the
corporation or the Shareholders for damages for breach of fiduciary duty as a
director or officer shall be limited to acts or omissions which involve
intentional misconduct, fraud or a knowing violation of law.
ARTICLE X - INDEMNIFICATION: Each director and each officer of the
corporation may be indemnified by the corporation as follows:
(a) The corporation may indemnify any person who was or is a party,
or is threatened to be made a party,to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the
right of the corporation), by reason of the fact that he is or was
a director, officer, employee or agent of the corporation, or is
or was serving at the request of the corporation as a director,
officer, employee or agent of other corporation, partnership, joint
venture, trust or other enterprise, against expenses (including
attorneys' (fees), judgments, fines and amounts paid in settlement,
actually and reasonably incurred by him in connection with the
action, suit or proceeding, if he acted in good faith and in a
manner which he reasonably believed to be in or not opposed to the
best interests of the corporation and with respect to any criminal
action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suite or
proceeding, by judgment, order, settlement, conviction or upon a
plea of nolo contendere or its equivalent, does not of itself
create a presumption that the person did not act in good faith and
in a manner which he reasonably believed to be in or not opposed to
the best interests of the corporation, and that, with respect to
any criminal action or proceeding, he had reasonable cause to
believe that his conduct was unlawful.
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(b) The corporation may indemnify any person who was or is a party, or
is threatened to be made a party, to any threatened, pending or
completed action or suit by or in the right of the corporation, to
procure a judgment in its favor by reason of the fact that he is or
was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses including
amounts paid in settlement and attorneys' fees actually and
reasonably incurred by him in connection with the defense or
settlement of the action or suit, if he acted in good faith and in
a manner which he reasonably believed to be in or not opposed to the
best interests of the corporation. Indemnification may not be made
for any claim, issue or matter as to which such a person has been
adjudged by a court of competent jurisdiction, after exhaustion of
all appeals there from, to be liable to the corporation or for
amounts paid in settlement to the corporation, unless and only to
the extent that the court in which the action or suit was brought
or other court of competent jurisdiction determines upon
application that in view of all the circumstances of the case the
person is fairly and reasonably entitled to indemnity for such
expenses as the court deems proper.
(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in
defense for any action, suit or proceeding referred to in
subsections (a) and (b) of this Article, or in defense of any
claim, issue or matter therein, he must be indemnified by the
corporation against expenses, including attorney's fees,
actually and reasonably incurred by him in connection with the
defense.
(d) Any indemnification under subsections (a) and (b) unless ordered by
a court or advanced pursuant to subsection (e), must be made by the
corporation only as authorized in the specific case upon a
determination that indemnification of the director, officer,
employee or agent is proper in the circumstances. The
determination must be made:
(i) By the stockholders;
(ii) By the board of directors by majority vote of a quorum
consisting of directors who were not parties to the act,
suit or proceeding;
(iii) If a majority vote of a quorum consisting of directors who
were not parties to the act, suit or proceeding so orders,
by independent legal counsel in a written opinion; or
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(iv) If a quorum consisting of directors who were not parties to
the act, suit or proceeding cannot be obtained, by
independent legal counsel in a written opinion.
(e) 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. The
provisions of this subsection do not affect any rights to
advancement of expenses to which corporate personnel other than
directors or officers may be entitled under any contract or
otherwise by law.
(f) The indemnification and advancement of expenses authorized in or
ordered by a court pursuant to this section:
(i) Does not exclude any other rights to which a person seeking
indemnification or advancement of expenses may be entitled
under the certificate or articles of incorporation or any
bylaw, agreement, vote of stockholders or disinterested
directors or otherwise, for either an action in his official
capacity or an action in another capacity while holding his
office, except that indemnification, unless ordered by a court
pursuant to subsection (b) or for the advancement of expenses
made pursuant to subsection (e) may not be made to or on
behalf of any director or officer if a final adjudication
establishes that his acts or omissions involved intentional
misconduct, fraud or a knowing violation of the law and was
material to the cause of action.
(ii) Continues for a person who has ceased to be a director,
officer, employee or agent and inures to the benefit of the
heirs, executors and administrators of such a person.
ARTICLE XI - PLACE OF MEETING; CORPORATE BOOKS: Subject to the laws of
the
State of Nevada, the shareholders and the Directors shall have power to hold
their meetings, and the Directors shall have power to have an office or
offices and to maintain the books of the Corporation outside the State of
Nevada, at such place or places as may from time to time be designated in the
By-Laws or by appropriate resolution.
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ARTICLE XII - AMENDMENT OF ARTICLES: The provisions of these Articles of
Incorporation may be amended, altered or repealed from time to time to the
extent and in the manner prescribed by the laws of the State of Nevada, and
additional provisions authorized by such laws as are then in force may be
added. All rights herein conferred on the directors, officers and
shareholders are granted subject to this reservation.
ARTICLE XIII - INCORPORATOR: The name and address of the sole incorporator
signing these Articles of Incorporation is as
follows:
NAME POST OFFICE ADDRESS
1. Max C. Tanner 2950 East Flamingo Road, Suite G
Las Vegas, Nevada 89121
IN WITNESS WHEREOF, the undersigned incorporator has executed
these Articles of Incorporation this 17th day of August, 1993.
/s/ MAX C. TANNER
Max C. Tanner
STATE OF NEVADA )
)ss:
COUNTY OF CLARK )
On April 6, 1995, personally appeared before me, a Notary Public,
Max C. Tanner, who acknowledged to me that he executed the foregoing Articles
of Incorporation for Bargain Products, Inc., a Nevada corporation.
/s/ WENDY PULLMAN
Notary Public
[Filed stamped as follows: "FILED IN THE OFFICE OF THE SECRETARY
OF STATE OF THE STATE OF NEVADA, APR 08 1995]
CERTIFICATE OF ACCEPTANCE
OF APPOINTMENT BY RESIDENT AGENT
IN THE MATTER OF BARGAIN PRODUCTS, INC.
We, The Law Offices of Max C. Tanner, do hereby certify that on the 17th
day of August, 1993, we accepted the appointment as Resident Agent of
the above-entitled corporation in accordance with Sec. 78.090, NRS 1957.
Furthermore, that the principal office in this state is located at
The Law Offices of Max C. Tanner, 2950 East Flamingo Road, Suite G, City
of Las Vegas 89121, County of Clark, State of Nevada.
IN WITNESS WHEREOF, I have hereunto set my hand this 6th day of
April, 1995.
THE LAW OFFICES OF MAX C. TANNER
By: /s/MAX C. TANNER
Max C. Tanner, Esq.
Resident Agent
BY-LAWS OF
BLINI HUT, INC.
(FORMERLY BARGAIN PRODUCTS, INC.)
ARTICLE I
SHAREHOLDERS
Section 1.01 Annual Meeting. The annual meeting of the shareholders
shall be held at such date and time as shall be designated by the board of
directors and stated in the notice of the meeting or in a duly-executed waiver
of notice thereof. If the corporation shall fail to provide notice of the
annual meeting of the shareholders as set forth above, the annual meeting of
the shareholders of the corporation shall be held during the month of November
or December of each year as determined by the Board of Directors, for the
purpose of electing directors of the corporation to serve during the ensuing
year and for the transaction of such other business as may properly come
before the meeting. If the election of the directors is not held on the day
designated herein for any annual meeting of the shareholders, or at any
adjournment thereof, the president shall cause the election to be held at a
special meeting of the shareholders as soon thereafter as is convenient.
Section 1.02 Special Meetings. Special meetings of the shareholders may
be called by the president or the Board of Directors and shall be called by
the president at the written request of the holders of not less than 51% of
the issued and outstanding shares of capital stock of the corporation.
All business lawfully to be transacted by the shareholders may be
transacted at any special meeting at any adjournment thereof. However, no
business shall be acted upon at a special meeting, except that referred to in
the notice calling the meeting, unless all of the outstanding capital stock of
the corporation is represented either in person or by proxy. Where all of the
capital stock is represented, any lawful business may be transacted and the
meeting shall be valid for all purposes.
Section 1.03 Place of Meetings. Any meeting of the shareholders of the
corporation may be held at its principal office in the State of Nevada or such
other place in or out of the United States as the Board of Directors may
designate. A waiver of notice signed by the shareholders entitled to vote may
designate any place for the holding of such meeting.
Section 1.04 Notice of Meetings.
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(a) The secretary shall sign and deliver to all shareholders
of record written or printed notice of any meeting at least ten (10)
days, but not more than sixty (60) days, before the date of such
meeting; which notice shall state the place, date and time of the
meeting, the general nature of the business to be transacted, and, in
the case of any meeting at which directors are to be elected, the names
of nominees, if any, to be presented for election.
(b) In the case of any meeting, any proper business may be
presented for action, except that the following items shall be valid only
if the general nature of the proposal is stated in the notice or written
waiver of notice:
(1) Action with respect to any contract or transaction
between the corporation and one or more of its directors or
another firm, association, or corporation in which one or more of
its directors has a material financial interest;
(2) Adoption of amendments to the Articles of
Incorporation; or
(3) Action with respect to the merger, consolidation,
reorganization, partial or complete liquidation, or dissolution of
the corporation.
(c) The notice shall be personally delivered or mailed by
first class mail to each shareholder of record at the last known address
thereof, as the same appears on the books of the corporation, and the
giving of such notice shall be deemed delivered the date the same is
deposited in the United States mail, postage prepaid. If the address of
any shareholder does not appear upon the books of the corporation, it will
be sufficient to address any notice to such shareholder at the principal
office of the corporation.
(d) The written certificate of the person calling any meeting,
duly sworn, setting forth the substance of the notice, the time and place
the notice was mailed or personally delivered to the several shareholders,
and the addresses to which the notice was mailed shall be prima facie
evidence of the manner and fact of giving such notice.
Section 1.05 Waiver of Notice. If all of the shareholders of the
corporation shall waive notice of a meeting, no notice shall be required, and,
whenever all of the shareholders shall meet in person or by proxy, such
meeting shall be valid for all purposes without call or notice, and at such
meeting any corporate action may be taken.
Section 1.06 Determination of Shareholders of Record.
(a) The Board of Directors may at any time fix a future date
as a record date for the determination of the shareholders entitled to
notice of any meeting or to vote or entitled to receive payment of any
dividend or other distribution or allotment of any rights or entitled to
exercise any rights in respect of any other lawful action. The record date
so fixed shall not be more than sixty (60) days prior to the date of such
meeting nor more than sixty (60) days prior to any other action. When a
record date is so fixed, only shareholders of record on that date are
entitled to notice of and to vote at the meeting or to receive the
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dividend, distribution or allotment of rights, or to exercise their rights,
as the case may be, notwithstanding any transfer of any shares on the
books of the corporation after the record date.
(b) If no record date is fixed by the Board of Directors, then
(1) the record date for determining shareholders entitled to notice of or
to vote at a meeting of shareholders shall be at the close of business on
the business day next preceding the day on which notice is given or, if
notice is waived, at the close of business on the day next preceding the
day on which the meeting is held; (2) the record date for determining
shareholders entitled to give consent to corporate action in writing
without a meeting, when no prior action by the Board of Directors is
necessary, shall be the day on which written consent is given; and (3)
the record date for determining shareholders for any other purpose shall
be at the close of business on the day on which the Board of Directors
adopts the resolution relating thereto, or the sixtieth (60th) day prior
to the date of such other action, whichever is later.
Section 1.07 Quorum: Adjourned Meetings.
(a) At any meeting of the shareholders, a majority of the issued
and outstanding shares of the corporation represented in person or by
proxy, shall constitute a quorum.
(b) If less than a majority of the issued and outstanding shares
are represented, a majority of shares so represented may adjourn from time
to time at the meeting, until holders of the amount of stock required to
constitute a quorum shall be in attendance. At any such adjourned meeting
at which a quorum shall be present, any business may be transacted which
might have been transacted as originally called. When a shareholders'
meeting is adjourned to another time or place, notice need not be given of
the adjourned meeting if the time and place thereof are announced at the
meeting at which the adjournment is taken, unless the adjournment is for
more than ten (10) days in which event notice thereof shall be given.
Section 1.08 Voting.
(a) Each shareholder of record, such shareholder's duly
authorized proxy or attorney-in-fact shall be entitled to one (1) vote for
each share of stock standing registered in such shareholder's name on the
books of the corporation on the record date.
(b) Except as otherwise provided herein, all votes with respect
to shares standing in the name of an individual on the record date
(included pledged shares) shall be cast only by that individual or such
individual's duly authorized proxy or attorney-in-fact. With respect to
shares held by a representative of the estate of a deceased shareholder,
guardian, conservator, custodian or trustee, votes may be cast by such
holder upon proof of capacity, even though the shares do not stand in
the name of such holder.In the case of shares under the control of a
receiver, the receiver may cast votes carried by such shares even though
the shares do not stand in the name of the receiver provided that the
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order of the court of competentjurisdiction which appoints the receiver
contains the authority to cast votes carried by such shares. If shares
stand in the name of a minor, votes may be cast only by the duly-
appointed guardian of the estate of such minor if such guardian has
provided the corporation with written notice and proof of such
appointment.
(c) With respect to shares standing in the name of a corporation
on the record date, votes may be cast by such officer or agents as the
by-laws of such corporation prescribe or, in the absence of an applicable
by-law provision, by such person as may be appointed by resolution of the
Board of Directors of such corporation. In the event no person is so
appointed, such votes of the corporation may be cast by any person
(including the officer making the authorization) authorized to do so by the
Chairman of the Board of Directors, President or any Vice President of
such corporation.
(d) Notwithstanding anything to the contrary herein contained,
no votes may be cast by shares owned by this corporation or its
subsidiaries, if any. If shares are held by this corporation or its
subsidiaries, if any, in a fiduciary capacity, no votes shall be cast with
respect thereto on any matter except to the extent that the beneficial
owner thereof possesses and exercises either a right to vote or to give
the corporation holding the same binding instructions on how to vote.
(e) With respect to shares standing in the name of two or more
persons, whether fiduciaries, members of a partnership, joint tenants,
tenants in common, husband and wife as community property, tenants by the
entirety, voting trustees, persons entitled to vote under a shareholder
voting agreement or otherwise and shares held by two or more persons
(including proxy holders) having the same fiduciary relationship respect in
the same shares, votes may be cast in the following manner:
(1) If only one such person votes, the votes of such person
binds all.
(2) If more than one person casts votes, the act of the
majority so voting binds all.
(3) If more than one person casts votes, but the vote is
evenly split on a particular matter, the votes shall be deemed cast
proportionately as split.
(f) Any holder of shares entitled to vote on any matter may cast
a portion of the votes in favor of such matter and refrain from casting the
remaining votes or cast the same against the proposal, except in the case
of elections of directors. If such holder entitled to vote fails to
specify the number of affirmative votes, it will be conclusively presumed
that the holder is casting affirmative votes with respect to all shares
held.
(g) If a quorum is present, the affirmative vote of holders of
a majority of the shares represented at the meeting and entitled to vote
on any matter shall be the act of the shareholders, unless a vote of
<PAGE>
greater number or voting by classes is required by the laws of the State
of Nevada, the Articles of Incorporation and these By-Laws.
Section 1.09 Proxies. At any meeting of shareholders, any holder of
shares entitled to vote may authorize another person or persons to vote by
proxy with respect to the shares held by an instrument in writing and
subscribed to by the holder of such shares entitled to vote. No proxy shall
be valid after the expiration of six (6) months from the date of execution
thereof, unless coupled with an interest or unless otherwise specified in the
proxy. In no event shall the term of a proxy exceed seven (7) years from the
date of its execution. Every proxy shall continue in full force and effect
until its expiration or revocation. Revocation may be effected by filing an
instrument revoking the same or a duly-executed proxy bearing a later date
with the secretary of the corporation.
Section 1.10 Order of Business. At the annual shareholders meeting, the
regular order of business shall be as follows:
(1) Determination of shareholders present and existence
of quorum;
(2) Reading and approval of the minutes of the previous
meeting or meetings;
(3) Reports of the Board of Directors, the president,
treasurer and secretary of the corporation, in the order named;
(4) Reports of committee;
(5) Election of directors;
(6) Unfinished business;
(7) New business;
(8) Adjournment.
Section 1.11 Absentees Consent to Meetings. Transactions of any meeting
of the shareholders are as valid as though had at a meeting duly-held after
regular call and notice if a quorum is present, either in person or by proxy,
and if, either before or after the meeting, each of the persons entitled to
vote, not present in person or by proxy (and those who, although present,
either object at the beginning of the meeting to the transaction of any
business because the meeting has not been lawfully called or convened or
expressly object at the meeting to the consideration of matters not included
in the notice which are legally required to be included
<PAGE>
therein), signs a written waiver of notice and/or consent to the holding of
the meeting or an approval of the minutes thereof. All such waivers,
consents, and approvals shall be filed with the corporate records and made a
part of the minutes of the meeting. Attendance of a person at a meeting shall
constitute a waiver of notice of such meeting, except when the person objects
at the beginning of the meeting to the transaction of any business because the
meeting is not lawfully called or convened and except that attendance at a
meeting is not a waiver of any right to object to the consideration of matters
not included in the notice if such objection is expressly made at the
beginning. Neither the business to be transacted at nor the purpose of any
regular or special meeting of shareholders need be specified in any written
waiver of notice, except as otherwise provided in Section 1.04(b) of these
By-Laws.
Section 1.12 Action Without Meeting. Any action which may be taken by
the vote of the shareholders at a meeting may be taken without a meeting if
consented to by the holders of a majority of the shares entitled to vote or
such greater proportion as may be required by the laws of the State of Nevada,
the Articles of Incorporation, or these ByLaws. Whenever action is taken by
written consent, a meeting of shareholders needs not be called or noticed.
ARTICLE II
DIRECTORS
Section 2.01 Number, Tenure and Qualification. Except as otherwise
provided herein, the Board of Directors of the corporation shall consist of at
least one (1) but no more than nine (9) persons, who shall be elected at the
annual meeting of the shareholders of the corporation and who shall hold
office for one (1) year or until their successors are elected and qualify.
Section 2.02 Resignation. Any director may resign effective upon giving
written notice to the chairman of the Board of Directors, the president, or
the secretary of the corporation, unless the notice specifies a later time for
effectiveness of such resignation. If the Board of Directors accepts the
resignation of a director tendered to take effect at a future date, the Board
or the shareholders may elect a successor to take office when the resignation
becomes effective.
Section 2.03 Reduction in Number. No reduction of the number of
directors shall have the effect of removing any director prior to the
expiration of his term of office.
Section 2.04 Removal.
(a) The Board of Directors or the shareholders of the
corporation, by a majority vote, may declare vacant the office of a
director who has been declared incompetent by an order of a court of
competent jurisdiction or convicted of a felony.
<PAGE>
Section 2.05 Vacancies.
(a) A vacancy in the Board of Directors because of death,
resignation, removal, change in number of directors, or otherwise may be
filled by the shareholders at any regular or special meeting or any
adjourned meeting thereof or the remaining director(s) by the affirmative
vote of a majority thereof. A Board of Directors consisting of less than
the maximum number authorized in Section 2.01 of ARTICLE II constitutes
vacancies on the Board of Directors for purposes of this paragraph and
may be filled as set forth above including by the election of a majority
of the remaining directors. Each successor so elected shall hold office
until the next annual meeting of shareholders or until a successor shall
have been duly-elected and qualified.
(b) If, after the filling of any vacancy by the directors, the
directors then in office who have been elected by the shareholders shall
constitute less than a majority of the directors then in office, any
holder or holders of an aggregate of five percent (5%) or more of the
total number of shares entitled to vote may call a special meeting of
shareholders to be held to elect the entire Board of Directors. The
term of office of any director shall terminate upon such election of a
successor.
Section 2.06 Regular Meetings. Immediately following the adjournment
of, and at the same place as, the annual meeting of the shareholders, the
Board of Directors, including directors newly elected, shall hold its annual
meeting without notice, other than this provision, to elect officers of the
corporation and to transact such further business as may be necessary or
appropriate. The Board of Directors may provide by resolution the place, date
and hour for holding additional regular meetings.
Section 2.07 Special Meetings. Special meetings of the Board of
Directors may be called by the chairman and shall be called by the chairman
upon the request of any two (2) directors or the president of the corporation.
Section 2.08 Place of Meetings. Any meeting of the directors of the
corporation may be held at its principal office in the State of Nevada, or at
such other place in or out of the United States as the Board of Directors may
designate. A waiver or notice signed by the directors may designate any place
for the holding of such meeting.
Section 2.09 Notice of Meetings. Except as otherwise provided in
Section 2.06, the chairman shall deliver to all directors written or printed
notice of any special meeting, at least three (3) days before the date of such
meeting, by delivery of such notice personally or mailing such notice first
class mail, or by telegram. If mailed, the notice shall be deemed delivered
two (2) business days following the date the same is deposited in the United
States mail, postage prepaid. Any director may waive notice of any meeting,
and the attendance of a director at a meeting shall constitute a waiver of
notice of such meeting, unless such attendance is for the express purpose of
objecting to the transaction of business threat because the meeting is not
<PAGE>
properly called or convened.
Section 2.10 Quorum: Adjourned Meetings.
(a) A majority of the Board of Directors in office shall
constitute a quorum.
(b) At any meeting of the Board of Directors where a quorum is not
present, a majority of those present may adjourn, from time to time,
until a quorum is present, and no notice of such adjournment shall be
required. At any adjourned meeting where a quorum is present, any
business may be transacted which could have been transacted at the
meeting originally called.
Section 2.11 Action Without Meeting. Any action required or permitted
to be taken at any meeting of the Board of Directors or any committee thereof
may be taken without a meeting if a written consent thereto is signed by all
of the members of the Board of Directors or of such committee. Such written
consent or consents shall be filed with the minutes of the proceedings of the
Board of Directors or committee. Such action by written consent shall have
the same force and effect as the unanimous vote of the Board of Directors or
committee.
Section 2.12 Telephonic Meetings. Meetings of the Board of Directors
may be held through the use of a conference telephone or similar
communications equipment so long as all members participating in such meeting
can hear one another at the time of such meeting. Participation in such a
meeting constitutes presence in person at such meeting.
Section 2.13 Board Decisions. The affirmative vote of a majority of the
directors present at a meeting at which a quorum is present shall be the act
of the Board of Directors.
Section 2.14 Powers and Duties.
(a) Except as otherwise provided in the Articles of
Incorporation or the laws of the State of Nevada, the Board of Directors
is invested with the complete and unrestrained authority to manage the
affairs of the corporation, and is authorized to exercise for such
purpose as the general agent of the corporation, its entire corporate
authority in such manner as it sees fit. The Board of Directors may
delegate any of its authority to manage, control or conduct the current
business of the corporation to any standing or special committee or to
any officer or agent and to appoint any persons to be agents of the
corporation with such powers, including the power to sub-delegate, and
upon such terms as may be deemed fit.
(b) The Board of Directors shall present to the shareholders at
annual meetings of the shareholders, and when called for by a majority
vote of the shareholders at a special meeting of the shareholders, a full
and clear statement of the condition of the corporation, and shall, at
request, furnish each of the shareholders with a true copy thereof.
<PAGE>
(c) The Board of Directors, in its discretion, may submit any
contract or act for approval or ratification at any annual meeting of the
shareholders or any special meeting properly called for the purpose of
considering any such contract or act, provided a quorum is present. The
contract or act shall be valid and binding upon the corporation and upon
all the shareholders thereof, if approved and ratified by the affirmative
vote of a majority of the shareholders at such meeting.
(d) In furtherance and not in limitation of the powers conferred
by the laws of the State of Nevada, the Board of Directors is expressly
authorized and empowered to issue stock of the Corporation for money,
property, services rendered, labor performed, cash advanced, acquisitions
for other corporations or for any other assets of value in accordance
with the action of the Board of Directors without vote or consent of the
shareholders and the judgment of the Board of Directors as to the value
received and in return therefore shall be conclusive and said stock, when
issued, shall be fully-paid and non-assessable.
Section 2.15 Compensation. The directors shall be allowed and paid all
necessary expenses incurred in attending any meetings of the Board.
Section 2.16 Board Officers.
(a) At its annual meeting, the Board of Directors shall elect,
from among its members, a chairman to preside at the meetings of the
Board of Directors. The Board of Directors may also elect such other
board officers and for such term as it may, from time to time, determine
advisable.
(b) Any vacancy in any board office because of death,
resignation, removal or otherwise may be filled by the Board of
Directors for the unexpired portion of the term of such office.
Section 2.17 Order of Business. The order of business at any meeting of
the Board of Directors shall be as follows:
(1) Determination of members present and existence of quorum;
(2) Reading and approval of the minutes of any previous meeting
or meetings;
(3) Reports of officers and committeemen;
(4) Election of officers;
(5) Unfinished business;
<PAGE>
(6) New business;
(7) Adjournment.
ARTICLE III
OFFICERS
Section 3.01 Election. The Board of Directors, at its first meeting
following the annual meeting of shareholders, shall elect a president, a
secretary and a treasurer to hold office for one (1) year next coming and
until their successors are elected and qualify. Any person may hold two or
more offices. The Board of Directors may, from time to time, by resolution,
appoint one or more vice presidents, assistant secretaries, assistant
treasurers and transfer agents of the corporation as it may deem advisable;
prescribe their duties; and fix their compensation.
Section 3.02 Removal; Resignation. Any officer or agent elected or
appointed by the Board of Directors may be removed by it whenever, in its
judgment, the best interest of the corporation would be served thereby. Any
officer may resign at any time upon written notice to the corporation without
prejudice to the rights, if any, of the corporation under any contract to
which the resigning officer is a party.
Section 3.03 Vacancies. Any vacancy in any office because of death,
resignation, removal, or otherwise may be filled by the Board of Directors
for the unexpired portion of the term of such office.
Section 3.04 President. The president shall be the general manager and
executive officer of the corporation, subject to the supervision and control
of the Board of Directors, and shall direct the corporate affairs, with full
power to execute all resolutions and orders of the Board of Directors not
especially entrusted to some other officer of the corporation. The president
shall preside at all meetings of the shareholders and shall sign the
certificates of stock issued by the corporation, and shall perform such other
duties as shall be prescribed by the Board of Directors.
Unless otherwise ordered by the Board of Directors, the president shall
have full power and authority on behalf of the corporation to attend and to
act and to vote at any meetings of the shareholders of any corporation in
which the corporation may hold stock and, at any such meetings, shall possess
and may exercise any and all rights and powers incident to the ownership of
such stock. The Board of Directors, by resolution from time to time, may
confer like powers on any person or persons in place of the president to
represent the corporation for these purposes.
Section 3.05 Vice President. The Board of Directors may elect one or
more vice presidents who shall be vested with all the powers and perform all
the duties of the president whenever the president is absent or unable to act,
including the signing of the certificates of stock
<PAGE>
issued by the corporation, and the vice president shall perform such other
duties as shall be prescribed by the Board of Directors.
Section 3.06 Secretary. The secretary shall keep the minutes of all
meetings of the shareholders and the Board of Directors in books provided for
that purpose. The secretary shall attend to the giving and service of all
notices of the corporation, may sign with the president in the name of the
corporation all contracts authorized by the Board of Directors or appropriate
committee, shall have the custody of the corporate seal, shall affix the
corporate seal to all certificates of stock duly issued by the corporation,
shall have charge of stock certificate books, transfer books and stock
ledgers, and such other books and papers as the Board of Directors or
appropriate committee may direct, and shall, in general perform all duties
incident to the office of the secretary. All corporate books kept by the
secretary shall be open for examination by any director at any reasonable
time.
Section 3.07 Assistant Secretary. The Board of Directors may appoint an
assistant secretary who shall have such powers and perform such duties as may
be prescribed for him by the secretary of the corporation or by the Board of
Directors.
Section 3.08 Treasurer. The treasurer shall be the chief financial
officer of the corporation, subject to the supervision and control of the
Board of Directors, and shall have custody of all the funds and securities of
the corporation. When necessary or proper, the treasurer shall endorse on
behalf of the corporation for collection checks, notes and other obligations,
and shall deposit all monies to the credit of the corporation in such bank or
banks or other depository as the Board of Directors may designate, and shall
sign all receipts and vouchers for payments made by the corporation. Unless
otherwise specified by the Board of Directors, the treasurer shall sign with
the president all bills of exchange and promissory notes of the corporation,
shall also have the care and custody of the stocks, bonds, certificates,
vouchers, evidence of debts, securities and such other property belonging to
the corporation as the Board of Directors shall designate, and shall sign all
papers required by law, by these By-laws or by the Board of Directors to be
signed by the treasurer. The treasurer shall enter regularly in the books of
the corporation, to be kept for that purpose, full and accurate accounts of
all monies received and paid on account of the corporation and whenever
required by the Board of Directors, the treasurer shall render a statement of
any or all accounts. The treasurer shall at all reasonable times exhibit the
books of account to any directors of the corporation and shall perform all
acts incident to the position of treasurer subject to the control of the Board
of Directors. The treasurer shall, if required by the Board of Directors,give
a bond to the corporation in such sum and with such security as shall be
approved by the Board of Directors for the faithful performance of all the
duties of the treasurer and for restoration to the corporation in the event of
the treasurer's death, resignation, retirement, or removal from office, of all
books, records, papers, vouchers, money and other property belonging to the
corporation. The expense of such bond shall be borne by the corporation.
<PAGE>
Section 3.09 Assistant Treasurer. The Board of Directors may appoint an
assistant treasurer who shall have such powers and perform such duties as may
be prescribed by the treasurer of the corporation or by the Board of
Directors, and the Board of Directors may require the assistant treasurer to
give a bond to the corporation in such sum and with such security as it may
approve,for the faithful performance of the duties of assistant treasurer, and
for the restoration to the corporation, in the event of the assistant
treasurer's death, resignation, retirement or removal from office, of all
books, records, papers, vouchers, money and other property belonging to the
corporation. The expense of such bond shall be borne by the corporation.
ARTICLE IV
CAPITAL STOCK
Section 4.01 Issuance. Shares of capital stock of the corporation shall
be issued in such manner and at such times and upon such conditions as shall
be prescribed by the Board of Directors.
Section 4.02 Certificates. Ownership in the corporation shall be
evidenced by certificates for shares of stock in such form as shall be
prescribed by the Board of Directors, shall be under the seal of the
corporation and shall be signed by the president or the vice president and
also by the secretary or an assistant secretary. Each certificate shall
contain the name of the record holder, the number, designation, if any, class
or series of shares represented, a statement of summary of any applicable
rights, preferences, privileges, or restrictions thereon, and a statement that
the shares are assessable, if applicable. All certificates shall be
consecutively numbered. The name and address of the shareholder, the number
of shares, and the date of issue shall be entered on the stock transfer books
of the corporation.
Section 4.03 Surrender: Lost or Destroyed Certificates. All
certificates surrendered to the corporation, except those representing shares
of treasury stock, shall be canceled and no new certificates shall be issued
until the former certificate for a like number of shares shall have been
canceled, except that in case of a lost, stolen, destroyed or mutilated
certificate, a new one may be issued therefor. However, any shareholder
applying for the issuance of a stock certificate in lieu of one alleged to
have been lost, stolen, destroyed or mutilated shall, prior to the issuance of
a replacement, provide the corporation with his, her or its affidavit of the
facts surrounding the loss, theft, destruction or mutilation and an indemnity
bond in an amount and upon such terms as the treasurer, or the Board of
Directors, shall require. In no case shall the bond be in amount less than
twice the current market value of the stock and it shall indemnify the
corporation against any loss, damage, cost or inconvenience arising as a
consequence of the issuance of a replacement certificate.
<PAGE>
Section 4.04 Replacement Certificate. When the Articles of
Incorporation are amended in any way affecting the statements contained in the
certificates for outstanding shares of capital stock of the corporation or it
becomes desirable for any reason, including, without limitation, the merger or
consolidation of the corporation with another corporation or the
reorganization of the corporation, to cancel any outstanding certificate for
shares and issue a new certificate therefor conforming to the rights of the
holder, the Board of Directors may order any holders of outstanding
certificates for shares to surrender and exchange the same for new
certificates within a reasonable time to be fixed by the Board of Directors.
The order may provide that a holder of any certificate(s) ordered to be
surrendered shall not be entitled to vote, receive dividends or exercise any
other rights of shareholders until the holder has complied with the order
provided that such order operates to suspend such rights only after notice and
until compliance.
Section 4.05 Transfer of Shares. No transfer of stock shall be valid as
against the corporation except on surrender and cancellation by the
certificate therefor, accompanied by an assignment or transfer by the
registered owner made either in person or under assignment. Whenever any
transfer shall be expressly made for collateral security and not absolutely,
the collateral nature of the transfer shall be reflected in the entry of
transfer on the books of the corporation.
Section 4.06 Transfer Agent. The Board of Directors may appoint one or
more transfer agents and registrars of transfer and may require all
certificates for shares of stock to bear the signature of such transfer agent
and such registrar of transfer.
Section 4.07 Stock Transfer Books. The stock transfer books shall be
closed for a period of ten (10) days prior to all meetings of the shareholders
and shall be closed for the payment of dividends as provided in Article V
hereof and during such periods as, from time to time, may be fixed by the
Board of Directors, and, during such periods, no stock shall be transferable.
Section 4.08 Miscellaneous. The Board of Directors shall have the power
and authority to make such rules and regulations not inconsistent herewith as
it may deem expedient concerning the issue, transfer and registration of
certificates for shares of the capital stock of the corporation.
ARTICLE V
DIVIDENDS
Section 5.01 Dividends may be declared, subject to the provisions of
the laws of the State of Nevada and the Articles of Incorporation, by the
Board of Directors at any regular or special meeting and may be paid in cash,
property, shares of corporate stock, or any other medium. The Board of
Directors may fix in advance a record date, as provided in Section 1.06 of
these By-laws, prior to the dividend payment for the purpose of determining
shareholders entitled to receive payment of any dividend. The Board of
Directors may close the stock transfer books for such
<PAGE>
purpose for a period of not more than ten (10) days prior to the payment date
of such dividend.
ARTICLE VI
OFFICES; RECORDS; REPORTS; SEAL AND FINANCIAL MATTERS
Section 6.01 Principal Office. The principal office of the corporation
in the State of Nevada shall be the Law Offices of Max C. Tanner, 2950 East
Flamingo Road, Suite G, Las Vegas, Nevada 89121, and the corporation may have
an office in any other state or territory as the Board of Directors may
designate.
Section 6.02 Records. The stock transfer books and a certified copy of
the By-laws, Articles of Incorporation, any amendments thereto, and the
minutes of the proceedings of the shareholders, the Board of Directors, and
committees of the Board of Directors shall be kept at the principal office of
the corporation for the inspection of all who have the right to see the same
and for the transfer of stock. All other books of the corporation shall be
kept at such places as may be prescribed by the Board of Directors.
Section 6.03 Financial Report on Request. Any shareholder or
shareholders holding at least five percent (5%) of the outstanding shares of
any class of stock may make a written request for an income statement of the
corporation for the three (3) month, six (6) month, or nine (9) month period
of the current fiscal year ended more than thirty (30) days prior to the date
of the request and a balance sheet of the corporation as of the end of such
period. In addition, if no annual report for the last fiscal year has been
sent to shareholders, such shareholder or shareholders may make a request for
a balance sheet as of the end of such fiscal year and an income statement and
statement of changes in financial position for such fiscal year. The
statement shall be delivered or mailed to the person making the request within
thirty (30) days thereafter. A copy of the statements shall be kept on file
in the principal office of the corporation for twelve (12) months, and such
copies shall be exhibited at all reasonable times to any shareholder demanding
an examination of them or a copy shall be mailed to each shareholder. Upon
request by any shareholder, there shall be mailed to the shareholder a copy of
the last annual, semiannual or quarterly income statement which it has
prepared and a balance sheet as of the end of the period. The financial
statements referred to in this Section 6.03 shall be accompanied by the report
thereon, if any, of any independent accountants engaged by the corporation or
the certificate of an authorized officer of the corporation that such
financial statements were prepared without audit from the books and records of
the corporation.
Section 6.04 Right of Inspection.
(a) The accounting books and records and minutes of proceedings
of the shareholders and the Board of Directors and committees of the
Board of Directors shall be open to inspection upon the written demand of
any shareholder or holder of a voting
<PAGE>>
trust certificate at any reasonable time during usual business hours for
a purpose reasonably related to such holder's interest as a shareholder
or as the holder of such voting trust certificate. This right of
inspection shall extend to the records of the subsidiaries, if any, of
the corporation. Such inspection may be made in person or by agent or
attorney, and the right of inspection includes the right to copy and make
extracts.
(b) Every director shall have the absolute right at any
reasonable time to inspect and copy all books, records and documents of
every kind and to inspect the physical properties of the corporation
and/or its subsidiary corporations. Such inspection may be made in
person or by agent or attorney, and the right of inspection includes the
right to copy and make extracts.
Section 6.05 Corporate Seal. The Board of Directors may, by
resolution, authorize a seal, and the seal may be used by causing it, or a
facsimile, to be impressed or affixed or reproduced or otherwise. Except when
otherwise specifically provided herein, any officer of the corporation shall
have the authority to affix the seal to any document requiring it.
Section 6.06 Fiscal Year. The fiscal year-end of the corporation shall
be the calendar year or such other term as may be fixed by resolution of the
Board of Directors.
Section 6.07 Reserves. The Board of Directors may create, by
resolution, out of the earned surplus of the corporation such reserves as the
directors may, from time to time, in their discretion, think proper to provide
for contingencies, or to equalize dividends or to repair or maintain any
property of the corporation, or for such other purpose as the Board of
Directors may deem beneficial to the corporation, and the directors may modify
or abolish any such reserves in the manner in which they were created.
ARTICLE VII
INDEMNIFICATION
Section 7.01 Indemnification. The corporation shall, unless prohibited
by Nevada Law, indemnify any person (an "Indemnitee") who is or was involved
in any manner (including, without limitation, as a party or a witness) or is
threatened to be so involved in any threatened, pending or completed action
suit or proceeding, whether civil, criminal, administrative, arbitrative or
investigative, including without limitation, any action, suit or proceeding
brought by or in the right of the corporation to procure a judgment in its
favor (collectively, a "Proceeding") by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust, employee benefit plan
or other entity or enterprise, against all Expenses and Liabilities actually
and reasonably incurred by him.
<PAGE>
in connection with such Proceeding. The right to indemnification conferred in
this Article shall be presumed to have been relied upon by the directors,
officers, employees and agents of the corporation and shall be enforceable as
a contract right and inure to the benefit of heirs, executors and
administrators of such individuals.
Section 7.02 Indemnification Contracts. The Board of Directors is
authorized on behalf of the corporation, to enter into, deliver and perform
agreements or other arrangements to provide any Indemnitee with specific
rights of indemnification in addition to the rights provided hereunder to the
fullest extent permitted by Nevada Law. Such agreements or arrangements may
provide (i) that 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
any such action, suit or proceeding provided that, if required by Nevada Law
at the time of such advance, the officer or director provides an undertaking
to repay such amounts if it is ultimately determined by a court of competent
jurisdiction that such individual is not entitled to be indemnified against
such expenses, (iii) that the Indemnitee shall be presumed to be entitled to
indemnification under this Article or such agreement or arrangement and the
corporation shall have the burden of proof to overcome that presumption, (iii)
for procedures to be followed by the corporation and the Indemnitee in making
any determination of entitlement to indemnification or for appeals therefrom
and (iv) for insurance or such other Financial Arrangements described in
Paragraph 7.02 of this Article, all as may be deemed appropriate by the Board
of Directors at the time of execution of such agreement or arrangement.
Section 7.03 Insurance and Financial Arrangements. The corporation may,
unless prohibited by Nevada Law, purchase and maintain insurance or make other
financial arrangements ("Financial Arrangements") on behalf of any Indemnitee
for any liability asserted against him and liability and expenses incurred by
him in his capacity as a director, officer, employee or agent, or arising out
of his status as such, whether or not the corporation has the authority to
indemnify him against such liability and expenses. Such other Financial
Arrangements may include (i) the creation of a trust fund, (ii) the
establishment of a program of self-insurance, (iii) the securing of the
corporation's obligation of indemnification by granting a security interest or
other lien on any assets of the corporation, or (iv) the establishment of a
letter of credit, guaranty or surety.
Section 7.04 Definitions. For purposes of this Article:
Expenses. The word "Expenses" shall be broadly construed and,
without limitation, means (i) all direct and indirect costs incurred,
paid or accrued, (ii) all attorneys' fees, retainers, court costs,
transcripts, fees of experts, witness fees, travel expenses, food and
lodging expenses while traveling, duplicating costs, printing and binding
costs, telephone charges, postage, delivery service, freight or other
transportation fees and expenses, (iii) all other disbursements and
out-of-pocket expenses, (iv) amounts paid in settlement, to the extent
permitted by Nevada Law, and (v) reasonable compensation for time spent
by the Indemnitee for which he is otherwise not
<PAGE>
compensated by the corporation or any third party, actually and
reasonably incurred in connection with either the appearance at or
investigation, defense, settlement or appeal of a Proceeding or
establishing or enforcing a right to indemnification under any agreement
or arrangement, this Article, the Nevada Law or otherwise; provided,
however, that "Expenses" shall not include any judgments or fines or
excise taxes or penalties imposed under the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or other excise taxes or
penalties.
Liabilities. "Liabilities" means liabilities of any type
whatsoever, including, but not limited to, judgments or fines, ERISA or other
excise taxes and penalties, and amounts paid in settlement.
Nevada Law. "Nevada Law" means Chapter 78 of the Nevada Revised
Statutes as amended and in effect from time to time or any successor or other
statutes of Nevada having similar import and effect.
This Article. "This Article" means Paragraphs 7.01 through 7.04 of
these bylaws or any portion of them.
Power of Stockholders. Paragraphs 7.01 through 7.04, including this
Paragraph, of these Bylaws may be amended by the stockholders only by vote of
the holders of sixty-six and two-thirds percent (66 2/3%) of the entire number
of shares of each class, voting separately, of the outstanding capital stock
of the corporation (even though the right of any class to vote is otherwise
restricted or denied); provided, however, no amendment or repeal of this
Article shall adversely affect any right of any Indemnitee existing at the
time such amendment or repeal becomes effective.
Power of Directors. Paragraphs 7.01 through 7.04 and this Paragraph
of these Bylaws may be amended or repealed by the Board of Directors only by
vote of eighty percent (80%) of the total number of Directors and the holders
of sixty-six and two-thirds percent (66 2/3) of the entire number of shares of
each class, voting separately, of the outstanding capital stock of the
corporation (even though the right of any class to vote is otherwise
restricted or denied); provided, however, no amendment or repeal of this
Article shall adversely affect any right of any Indemnitee existing at the
time such amendment or repeal becomes effective.
<PAGE>
ARTICLE VIII
BY-LAWS
Section 8.01 Amendment. Amendments and changes of these By-Laws may be
made at any regular or special meeting of the Board of Directors by a vote of
not less than all of the entire Board, or may be made by a vote of, or a
consent in writing signed by the holders of a majority of the issued and
outstanding capital stock.
Section 8.02 Additional By-Laws. Additional by-laws not inconsistent
herewith may be adopted by the Board of Directors at any meeting of the Board
of Directors at which a quorum is present by an affirmative vote of a majority
of the directors present or by the unanimous consent of the Board of Directors
in accordance with Section 2.11 of these By-laws.
CERTIFICATION
I, the undersigned, being the duly elected secretary of the Corporation,
do hereby certify that the foregoing By-laws were adopted by the Board of
Directors on the 6th day of April, 1995.
/s/ MONT TANNER
Mont Tanner, Secretary
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
FOR
BARGAIN PRODUCTS, INC.
Pursuant to NRS 78.385, 78/390 and 78.207, the undersigned President
and Secretary of Bargain Products, Inc. do hereby certify:
That the following amendments to the articles of incorporation were
approved by the Board of Directors of said corporation by written consent in
lieu of a special meeting of the Board of Directors, dated July 14, 1997,
and by a positive vote of a majority of the outstanding shares entitled to
vote on July 14, 1997, there being 8,428,571 shares authorized to vote and
4,802,500 shares having voted in favor of the amended articles.
1. CHANGE OF AUTHORIZED CAPITAL
After giving effect to a on for one hundred (1 for 100) reverse stock
stock split of the common stock, the authorized common stock shall be
decreased from 25,000,000 shares, $.001 par value per share to 250,000
shares of common stock, $.10 par value per share, which stock split and
subsequent decrease in the number of authorized shares shall be effective
on July 29, 1997 pending approval from the NASD. Any fractions created
by one for one hundred (1 for 100) reverse stock split of the common stock
shall be rounded up. Subsequent to the one for one hundred (1 for 100)
reverse stock split, the authorized common stock shall be increased from
250,000 shares of common stock, $.10 par value per share to 10,000,000
shares of common stock, $.10 par value per share, also effective on
July 29, 1997.
Accordingly,
Effective July 29, 1997, pending approval from the NASD, Article VI,
Section 1, is hereby amended to read as follows:
Section 1. AUTHORIZED SHARES. The total number of shares which this
Corporation is authorized to issue is 10,000,000 shares of common stock,
$.10 par value per share, after giving effect to a one for one hundred
(1 for 100) reverse stock split and a subsequent increase in the authorized
shares of common stock.
The Certificate of Amendment of Articles of Incorporation may be executed in
two or more counterparts.
/s/Max C. Tanner /s/Mont E. Tanner
___________________________ _________________________
President Secretary
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
FOR
BARGAIN PRODUCTS, INC.
Pursuant to NRS 78.207, the undersigned President and Secretary of
Bargain Products, Inc. do hereby certify:
That the following amendment to the articles of incorporation were
approved by the Board of Directors of said corporation by written consent
in lieu of a special meeting of the Board of Directors, dated April 10, 1998,
there being 84,286 shares authorized to vote and 48,025 shares having
voted in favor of the amended articles.
1. CHANGE OF PAR VALUE AND AUTHORIZED CAPITAL.
After giving effect to a one for ten (1 for 10) reverse stock split of
common stock, the authorized common stock shall be decreased from 10,000,000
share, $.10 par value per share to 1,000,000 shares of common stock, $.10 par
value per share, which stock split and subsequent decrease in the number of
authorized shares, shall be effective on May 2, 1998 pending approval from
NASD. Any fractions created by the one for ten (1 for 10) reverse stock
split of the common stock shall be rounded up.
Accordingly,
Effective May 2, 1998, pending approval from NASD, Article VI, Section 1,
is hereby amended to read as follows:
Section 1. AUTHORIZED SHARES. The total number of shares which this
Corporation is authorized to issue is 1,000,000 shares of common stock, $.10
par value per share, after giving effect to a one for ten (1 for 10) reverse
stock split of common stock.
This Certificate of Amendment of Articles of Incorporation may be executed
in two or more counterparts.
/s/Max C. Tanner /s/Mont E. Tanner
______________________________ _____________________________
President Secretary
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
FOR PROFIT NEVADA CORPORATIONS
(Pursuant to NRS 78.385 and 78.390 After Issuance of Stock)
Remit in Duplicate
1. Name of corporation: Bargain Products, Inc.
2. The articles have been amended as follows:
NAME CHANGE FROM BARGAIN PRODUCTS, INC, TO BLINI HUT, INC.
3. The vote by which the stockholders holding shares in the corporation
entitling them to exercise at least a majority of the voting power, or
such greater proportion of the voting power as may be required in the case
of a vote by classes or series, or as may be required by the provisions
of the articles of incorporation have voted in favor of the amendments is:
OVER 50%
4. Signatures:
By: /s/Mont E. Tanner
_______________________
President
State of: NEVADA
County of: CLARK
This instrument was acknowledged before me on
5/18/1999 by
Mont Tanner
as President
as designated to sign this certificate
of BARGAIN PRODUCTS, INC.
By: /s/Max C. Tanner
- --------------------
Notary Public
Note: If any proposed amendment would alter or change any preference or any
relative or other right given to any class or series of outstanding shares,
then the amendment must be approved by the vote, in addition to the
affirmative vote otherwise required, of the holders of shares representing
a majority of the voting power of each class or series affected by the
amendment regarkless of limitation or restriction on the voting power
thereof.
(in form of certificate, two-sided)
Blini Hut, Inc.
INCORPORATED UNDER THE LAWS OF THE STATE OF NEVADA
25,000,000 SHARES OF COMMON STOCK AUTHORIZED, $.001 PAR VALUE
NUMBER_________ SHARES________
CUSIP 093544104
This certifies that
is the owner of
FULLY PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK
OF
Blini Hut, Inc
transferable on the books of the corporation in person or by duly authorized
attorney upon surrender of this certificate properly endorsed. This
certificate and the shares represented hereby are subject to the laws of the
State of Nevada, and to the Certificate of Incorporation and Bylaws by the
Corporation, as now or hereafter amended. This certificate is not valid unless
countersigned by the Transfer Agent.
WITNESS the facsimile seal of the Corporation and the signature of its duly
authorized officers.
DATED
(seal as follows: "BARGAIN PRODUCTS, INC. CORPORATE SEAL, NEVADA")
/s/RONALD L DRAKE /s/TERRY FIELDS
PRESIDENT SECRETARY
Countersigned and Registered
PACIFIC STOCK TRANSFER COMPANY
P.O. Box 93385
Las Vegas, NV 89193
By:____________________________________
AUTHORIZED SIGNATURE
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT--Custodian--
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right of under Uniform Gifts to Minors
survivorship and not as tenants Act_______________________
in common (State)
Additional abbreviations may also be used though not in the above list.
For Value Received, __________hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
__________________________________
- -----------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP
CODE, OF ASSIGNEE)
- ----------------------------------------------------------------------------
- ----------------------------------------------------------------------------
- -----------------------------------------------------------------------Shares
of the capital stock represented by the within certificate, and do hereby
irrevocably constitute and appoint___________________________________Attorney
to transfer the said stock on the books of the within named Corporation with
full power of substitution in the premises.
Dated__________________
_________________________________________________________________________
NOTICE: SIGNATURE MUST CORRESPOND TO THE NAME AS WRITTEN
UPON THE FACE OF
THIS CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERNATION OR
ENLARGEMENT OR
ANY CHANGE WHATSOEVER, AND MUST BE GUARANTEED BY A BANK,
BROKER OR ANY OTHER
ELIGIBLE GUARANTOR INSTITUTION THAT IS AUTHORIZED TO DO SO
UNDER THE
SECURITIES TRANSFER AGENTS MEDALLION PROGRAM (STAMP) UNDER
RULES PROMULGATED
BY THE U.S. SECURITIES AND EXCHANGE COMMISSION.
STOCK-FOR-STOCK AGREEMENT
REORGANIZATION AGREEMENT between Bargain Products, Inc., a Nevada
corporation (hereinafter referred to as "BRGN"), and shareholders of Troika, a
Delaware corporation (hereinafter referred to as "Troika").
For the Acquisition by BRGN of all the outstanding stock of Troika, in
exchange for stock of BRGN.
AGREEMENT, dated as of this 10th day of April, 1999, between BRGN and all
of the Shareholders of Troika (hereinafter collectively referred to as the
"Troika Shareholders").
WHEREAS, the Troika Shareholders own 1,000,000 shares of common stock, $.01
par value per share, of Troika, and which constitutes all of the outstanding
shares of common stock of Troika.
of the outstanding common stock of Troika, for a total of 1,000,000 issued and
outstanding shares of common stock of Troika.
WHEREAS, the Troika Shareholders own and have the right to sell, transfer
and exchange all of the shares for the purchase of the capital stock of Bargain
Products, Inc., Bargain Products, Inc. hereby offers 6,000,000 shares of its
restricted common stock to the Troika Shareholders for all of the outstanding
common stock of Troika and Bargain Products will have $80,000 in its corporate
account at the time of the exchange. The Troika Shareholders wish to make said
exchange.
WHEREAS, the parties hereto intend that the securities exchange described
herein between Bargain Products, Inc. and the Shareholders of Troika will be tax
free in accordance with the provisions of Section 368(a)(1)(B) of the Internal
Revenue Code.
NOW THEREFORE, in consideration of the premises and of the mutual covenants
hereinafter set forth, the parties hereto have agreed and by these present do
hereby agree as follows:
1.Exchange of Securities. Subject to the terms and conditions
hereinafter set forth, at the time of the closing referred to in Section 6
hereof (the "Closing Date"), Bargain Products, Inc. will issue and deliver, or
cause to be issued and delivered to the Troika Shareholders, in exchange for all
of the issued and outstanding shares of Troika, 6,000,000 shares of its common
stock.The shares of Bargain Products, Inc. will be allocated as set forth in
Schedule I, attached hereto. The shares of Troika Shareholders will be
exchanged for shares in Bargain Products, Inc. on a six-for-one (6 for 1)
basis.
2.Representations and Warranties by Troika and Troika Shareholders.
Troika and Troika Shareholders each represent and warrant to Bargain Products,
Inc., all of which representations and warranties shall be true at the time of
closing, and shall survive the closing for a period of six (6) months from the
date of closing, except as to the warranties and representations set forth in
subsection (i) herein, which shall survive for a period of three (3) years from
the date of closing, and those set forth in subsection (l) herein, which shall
survive for a period of six (6) months from the date of closing, or from the
date when the accounts receivable may become due and payable, whichever shall
occur later, that:
(a)Troika is a corporation duly organized and validly existing and
in good standing under the laws of the State of Delaware and has the
corporate powers to own its property and carry on its business as and where
it is now being conducted. Copies of the Certificate of Incorporation and
the By-Laws of Troika, which have heretofore been furnished by Troika
Shareholders to Bargain Products, Inc., are true and correct copies of said
Certificate of Incorporation and By-Laws including all amendments to the
date hereof.
(b)The authorized capital stock of Troika consists of 4,000,000
shares of common stock, $.01 par value ("Common Stock of Troika"), of which
1,000,000 shares have been validly issued and are now outstanding.
(c)Troika Shareholders have full power to exchange the shares to
purchase the capital stock of Bargain Products, Inc. on behalf of
themselves upon the terms provided for in this Agreement, and said shares
have been duly and validly issued and are free and clear of any lien or
other encumbrance.
(d)From the date hereof, and until the date of closing, no
dividends or distributions of capital, surplus, or profits shall be paid or
declared by Troika in redemption of their outstanding shares or otherwise,
and except as described herein no additional shares shall be issued by said
corporation.
(e)Since the date hereof, Troika has not engaged in any transaction
other than transactions in the normal course of the operations of their
business, except as specifically authorized by Bargain Products, Inc. in
writing.
(f)Troika is not involved in any pending or threatened litigation
which would materially affect its financial condition disclosed to Bargain
Products, Inc. in writing.
(g)Troika has and will have on the Closing Date, good and
marketable title to all of its property and assets shown on Schedule II,
attached hereto, free and clear of any and all liens or encumbrances or
restrictions, except as shown on Schedule II, attached hereto and except
for taxes and assessments due and payable after the Closing Date and
easements or minor restrictions with respect to its property which do not
materially affect the present use of such property.
(h)(1)The inventories of Troika as reflected in Schedule II,
furnished by Troika Shareholders to Bargain Products, Inc. prior to the
execution hereof, are valued at book value.
(2)The inventory of Troika listed on the schedule referred
to in (h) (1) above is hereinafter collectively referred to as the
"Inventory." The Inventory is in good and usable condition.
(i)As of the date hereof, there are no accounts receivable of
Troika of a material nature, except for those accounts receivable set forth
in Schedule II, attached hereto.
(j)Troika does not now have, nor will it have on the Closing Date,
any long-term contracts ("long-term" being defined as more than one year)
except those set forth in Schedule II attached hereto.
(k)Troika does not now have, nor will it have on the Closing Date
any pension plan, profit-sharing plan, or stock purchase plan for any of
its employees except those set forth in Schedule II, attached hereto and
certain options to proposed executive officers.
(l)Troika does not now have, nor will it have on the Closing Date,
any known liabilities or contingent liabilities.
(m)Upon completion of the stock exchange described herein, the
former Troika shareholders who will be receiving the 6,000,000 shares of BRGN
restricted common stock will not cause or allow BRGN to undertake a reverse
stock split until all options to purchase any currently outstanding common stock
have been exercised.
3.Representations and Warranties by Bargain Products, Inc.. Bargain
Products, Inc. represents and warrants to the Troika Shareholders, all of which
representations and warranties shall be true at the time of closing, and shall
survive the closing for a period of six (6) months from the date of closing, as
follows:
(a)Bargain Products, Inc. is a corporation duly organized and
validly existing and in good standing under the laws of the State of Nevada
and has the corporate power to own its properties and carry on its business
as now being conducted and has authorized capital stock consisting of
10,000,000 shares of common stock, $.01 par value per share, of which there
are 508,461 shares presently outstanding.
(b)Bargain Products, Inc. has the corporate power to execute and
perform this Agreement, and to deliver the stock required to be delivered
to Troika Shareholders hereunder.
(c)The execution and delivery of this Agreement, and the issuance
of the stock required to be delivered hereunder have been duly authorized
by all necessary corporate actions, and neither the execution nor delivery
of this Agreement, nor the issuance of the stock, nor the performance,
observance or compliance with the terms and provisions of this Agreement
will violate any provision of law, any order of any court or other
governmental agency, the Certificate of Incorporation or By-Laws of Bargain
Products, Inc. or any indenture, agreement or other instrument to which
Bargain Products, Inc. is a party, or by which Bargain Products, Inc. is
bound, or by which any of its property is bound.
(d)The shares of Common Stock of Bargain Products, Inc. deliverable
pursuant hereto will on delivery in accordance with the terms hereof, be
duly authorized, validly issued, and fully paid, and non-assessable.
(e)Bargain Products, Inc., agrees not to undertake a reverse stock
split until such time as all options to purchase any currently outstanding
common stock have been exercised.
4.Conditions to the Obligations of Bargain Products, Inc.. The
obligations of Bargain Products, Inc. hereunder shall be subject to the
conditions that:
(a)Bargain Products, Inc. shall not have discovered any material
error or misstatement in any of the representations and warranties by the
Troika Shareholders herein, and all the terms and conditions of this
Agreement to be performed and complied with shall have been performed and
complied with.
(b)There shall have been no substantial adverse changes in the
conditions, financial, business otherwise of Troika from the date of this
Agreement, and until the date of closing, except for changes resulting from
those operations in the usual and ordinary course of business, and between
such dates the business and assets of Troika shall not have been materially
adversely affected as the result of any fire, explosion, earthquake, flood,
accident, strike, lockout, combination of workmen, taking over of any such
assets by any governmental authorities, riot, activities of armed forces,
or acts of God or of the public enemies.
(c)Bargain Products, Inc. shall upon request and at the time of
closing, receive an opinion of counsel to the effect that: (1) Troika is
duly organized and validly existing under the laws of the State of Delaware
and has the power and authority to own its properties and to carry on its
respective business wherever the same shall be located and operated as of
the Closing Date; and, (2) this Agreement has been duly executed and
delivered by Troika Shareholders and constitutes a legal, valid and binding
obligation of the Troika Shareholders enforceable in accordance with its
terms.
(d)Troika does not now have, nor will it have on the date of
closing, any known or unknown liabilities or contingent liabilities, except
as specifically set forth on Schedule II, attached hereto.
5.Conditions to the Obligations of Troika Shareholders. The obligations
of the Troika Shareholders hereunder are subject to the conditions that:
(a)Troika Shareholders shall not have discovered any material error
or misstatement in any of the representations and warranties made by
Bargain Products, Inc. herein and all the terms and conditions of this
Agreement to be performed and complied with by Bargain Products, Inc. shall
have been performed and complied with.
(b)The Troika Shareholders shall upon request, at the time of
closing, receive an opinion of counsel to the effect that: (1) Bargain
Products, Inc. is a corporation duly organized and validly existing under
the laws of the State of Nevada, and has the power to own and operate its
properties wherever the same shall be located as of the Closing Date; (2)
the execution, delivery and performance of this Agreement by Bargain
Products, Inc. has been duly authorized by all necessary corporate action
and constitutes a legal, valid and binding obligation of Bargain Products,
Inc., enforceable in accordance with its terms; (3) the securities to be
delivered to Troika Stockholders pursuant to the terms of this Agreement
has been validly issued, is fully paid and non-assessable; (4) the exchange
of the securities herein contemplated does not require the registration of
the Bargain Products, Inc. securities pursuant to any Federal law dealing
with the issuance, sale, transfer, and/or exchange of corporate
securities;
(5) that Bargain Products, Inc. is not under investigation by the SEC, the
NASD or any state securities commission; (6) that there are no known
securities violations; (7) all shares issued by Bargain Products, Inc. have
been validly issued in accordance with Nevada or Federal law, are fully
paid and non-assessable; and (8) there are no outstanding options, rights,
warrants, conversion privileges or other agreements which would require
issuance of additional shares.
6.Closing Date. The closing shall take place on or before April 9,
1999, or as soon thereafter as is practicable, at the Law Offices of Max C.
Tanner, 2950 East Flamingo Road, Suite G, Las Vegas, Nevada 89121, or at such
other time and place as the parties hereto shall agree upon.
7.Actions at the Closing. At the closing, Bargain Products, Inc. and
Troika Shareholders will each deliver, or cause to be delivered to the other,
the securities to be exchanged in accordance with Section I of this Agreement
and each party shall pay any and all Federal and State taxes required to be
paid in connection with the issuance and the delivery of their own securities.
All stock certificates shall be in the name of the party to which the same are
deliverable.
8.Conduct of Business, Board of Directors, etc. Between the date hereof
and the Closing Date, Troika will conduct its business in the same manner in
which it has heretofore been conducted and the Troika Shareholders will not
permit Troika to: (1) enter into any contract, etc., other than in the ordinary
course of business; or (2) declare or make any distribution of any kind to the
stockholders of Troika, without first obtaining the written consent of Bargain
Products, Inc..
Upon closing, the old officers and members of the board of directors of
Bargain Products, Inc. will tender their resignations and a new Board of
Directors will be elected by the shareholders of Bargain Products, Inc., which
shall consist of the following individuals:
Simon Kublanov
Leonid Kuvykin
Upon election of the above Board of Directors, and subject to the authority
of the Board of Directors as provided by law and the By-Laws of Bargain Products
Inc., the new officers of Bargain Products, Inc., after the closing date of this
Agreement shall be as follows:
Simon KublanovPresident and Chief Executive Officer
Leonid KuvykinSecretary & Treasurer
9.Access to the Properties and Books of Troika. The Troika Shareholders
hereby grant to Bargain Products, Inc., through their duly authorized
representatives and during normal business hours between the date hereof and the
Closing Date, the right of full and complete access to the properties of Troika
and full opportunity to examine their books and records.
10.Miscellaneous
(a)This Agreement shall be controlled, construed and enforced in
accordance with the laws of the State of Nevada.
(b)Each of the Constituent Corporations shall bear and pay all
costs and expenses incurred by it or on its behalf in connection with the
consummation of this Agreement, including, without limiting the generality
of the foregoing, fees and expenses of financial consultants, accountants
and counsel and the cost of any documentary stamps, sales and excise taxes
which may be imposed upon or be payable in respect to the transaction.
(c)At any time before or after the approval and adoption by the
respective stockholders of the Constituent Corporations, if required, this
Reorganization Agreement may be amended or supplemented by additional
written agreements, as may be determined in the judgment of the respective
Boards of Directors of the Constituent Corporations to be necessary,
desirable or expedient to further the purpose of this Reorganization
Agreement, to clarify the intention of the parties, to add to or to modify
the covenants, terms or conditions contained herein, or otherwise to
effectuate or facilitate the consummation of the transaction contemplated
hereby. Any written agreement referred to in this paragraph shall be
validly and sufficiently authorized for the purposes of this Reorganization
Agreement if signed on behalf of Troika or Bargain Products, Inc., as the
case may be, by its Chairman of the Board, or its President.
(d)This Reorganization Agreement may be executed in any number of
counterparts and each counterpart hereof shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
Reorganization Agreement.
(e)This Agreement shall be binding upon and shall inure to the
benefit of the heirs, executors, administrators and assigns of the Troika
Shareholders and upon the successors and assigns of Bargain Products, Inc..
(f)All notices, requests, instructions, or other documents to be
given hereunder shall be in writing and sent by registered mail:
If to Troika
Shareholders, then:Simon Kublanov
47-39 49th Street
Woodside, NY 11377
If to Bargain Products, Inc.,
then:Bargain Products, Inc.
2959 E. Flamingo Road, Ste. G
Las Vegas, NV 89121
The foregoing Reorganization Agreement, having been duly approved or adopted
by the Board of Directors, and duly approved or adopted by the stockholders of
the constituent corporation, as required, in the manner provided by the laws of
the State of Nevada, the Chairman of the Board, the President or the Secretary
of said corporations, and the Shareholders of Troika do now execute this
Reorganization Agreement under the respective seals of said corporation by the
authority of the directors and stockholders of each, as required, as the act,
deed and agreement of each of said corporations. This Stock-For-Stock Agreement
may be signed in two or more counterparts.
BARGAIN PRODUCTS, INC.
By:/s/Mont E. Tanner
Mont Tanner, President
SHAREHOLDERS
/s/Simon Kublanov
Simon Kublanov
/s/Leonid Kuvykin
Leonid Kuvykin
SHAREHOLDERS OF TROIKA
Name Number of Shares
Simon Kublanov 300,000
Leonid Kuvykin 700,000
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM AUDITED
FINANCIAL STATEMENT DATED DECEMEBER 31, 1998 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000943912
<NAME> BARGAIN PRODUCTS INC / UT
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> AUG-31-1999
<CASH> 100
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 79800
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 79858
<CURRENT-LIABILITIES> 350
<BONDS> 0
0
0
<COMMON> 80843
<OTHER-SE> (1335)
<TOTAL-LIABILITY-AND-EQUITY> 79858
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 312133
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
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