AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is
made this 24th day of December, 2001, among Bethurum Laboratories, Ltd., a
corporation organized under the laws of the British Virgin Islands
("Bethurum"); Global Starlink Group, Inc., a corporation organized under the
laws of the Cayman Islands, British West Indies ("GSL"); and Allstate
Development Ltd., a Hong Kong business entity that is the sole GSL stockholder
(the "GSL Stockholder"), as listed on Exhibit A hereto;
WITNESSETH:
RECITALS
WHEREAS, the respective Boards of Directors of Bethurum and GSL
have adopted resolutions pursuant to which Bethurum shall acquire and the GSL
Stockholder shall exchange 100% of the outstanding common stock of GSL; and
WHEREAS, the sole consideration for 100% of the outstanding common
stock of GSL shall be the exchange shares of no par value common stock of
Bethurum (which shares are all "restricted securities" as defined in Rule 144
of the Securities and Exchange Commission) as outlined in Exhibit A; and
WHEREAS, the GSL Stockholder shall acquire in exchange such
"restricted securities" of Bethurum in a reorganization within the meaning of
Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended, and/or
any other "tax free" exemptions thereunder that may be available for this
exchange, if and only to the extent that the Internal Revenue Code applies to
this Agreement and the transactions contemplated thereby ;
NOW, THEREFORE, in consideration of the mutual covenants and
promises contained herein, it is agreed:
Section 1
Exchange of Stock
1.1 Transfer and Number of Shares. The GSL Stockholder agrees
to transfer to Bethurum at the closing (the "Closing") 100% of the outstanding
common stock of GSL listed in Exhibit A, which is attached hereto and
incorporated herein by reference (the "GSL Shares"), in exchange for
30,400,000 shares of common stock of Bethurum, as outlined in Exhibit A. At
the Closing, there will be 32,000,750 post-Agreement outstanding shares of
common stock of the reorganized Bethurum, which takes into account the
cancellation of 1,700,000 shares of Bethurum's pre-Agreement outstanding
common stock held in the name of Benchmark Merchant Partners, LLP as outlined
in Section 1.5 hereof.
1.2 Exchange of Certificates by GSL Stockholder. The transfer
of the GSL Shares shall be effected by the delivery to Bethurum at the Closing
of a stock certificate or certificates duly endorsed in blank or accompanied
by stock powers executed in blank with all signatures witnessed or guaranteed
to the satisfaction of Bethurum and with all necessary transfer taxes and
other revenue stamps affixed and acquired at the GSL Stockholder's expense.
1.3 Further Assurances. At the Closing and from time to time
thereafter, the GSL Stockholder shall execute such additional instruments and
take such other action as Bethurum may request in order to exchange and
transfer clear title and ownership in the GSL Shares to Bethurum.
1.4 Reverse Split of Post-Agreement Outstanding Bethurum Common
Stock and Increase in Capitalization. Within 45 days of the Closing, the
reorganized Bethurum shall have approved: (i) a reverse split of Bethurum's
outstanding common stock on a basis of one share for four shares; and (ii) an
increase in Bethurum's authorized capital from 100,000,000 shares of common
stock to 1,000,000,000 shares of common stock.
1.5 Cancellation of Shares in the Name of Benchmark Merchant
Partners, LLP. Prior to Closing, Bethurum was required to have met all
conditions for the cancellation of 1,700,000 shares of its outstanding common
stock held in the name of Benchmark Merchant Partners, LLP. These shares were
canceled on the books and records of Bethurum's transfer agent, American
Registrar & Transfer Co., on or about November 30, 2001.
1.6 Resignations of Present Directors and Executive Officers and
Designation of New Directors and Executive Officers. On Closing, the present
directors and executive officers of Bethurum shall designate the directors and
executive officers nominated by the GSL Stockholder to serve in their place
and stead, until the next respective annual meetings of the stockholders and
the Board of Directors of the reorganized Bethurum, and until their respective
successors shall be elected and qualified or until their respective prior
resignations or terminations, who shall be: Mai Wong, Director; Luis Chang,
Director, President and CEO; and Murray Findley, Director, Vice President and
Secretary; and then, the current directors and executive officers shall
resign, in seriatim.
1.7 Change of Name. At or simultaneous to the Closing, the
Board of Directors of Bethurum shall adopt the resolutions necessary to amend
Bethurum's Articles of Association to change Bethurum's name to "GSL Group,
Inc."
1.8 Assets and Liabilities of Bethurum at Closing. Bethurum shall
have no assets at Closing; and with the exception of the liabilities
referenced in Section 1.9, no liabilities at Closing, and all costs incurred
by Bethurum incident to the Agreement shall have been paid or satisfied.
1.9 Outstanding Secured Promissory Notes, Approval and Non-
Contestability. Bethurum is indebted to William A. Silvey, Jr. and W. Scott
Thompson for the aggregate sum of $350,000, as evidenced by Exhibit B (a
Promissory Note in the amount of $175,000 payable to the order of Mr. Silvey);
and Exhibit B-1 (a Promissory Note in the amount of $175,000 payable to the
order of Mr. Thompson). GSL and the GSL Stockholder hereby (i) approve and
agree not to contest the Promissory Notes in any manner whatsoever singly or
on behalf of Bethurum; (ii) to cause Bethurum to pay these Promissory Notes in
accordance with their terms, and if not paid when due, to assume and guarantee
all obligations of Bethurum under these Promissory Notes and to pay the entire
balance due thereunder within 10 days after any such default; and (iii) to
reserve or cause to be reserved by Bethurum a sufficient number of shares of
common voting stock of Bethurum from its authorized capital for issuance to
Messrs. Silvey and Thompson so that in the event of any default and
foreclosure on the Promissory Notes, that Messrs. Silvey and Thompson can
collectively be issued an amount of common voting stock of Bethurum that will
then represent not less than 51% of the post-Agreement outstanding voting
securities of Bethurum which is one of the options on default provided for in
the Promissory Notes, and in the event that this default option is applicable,
then to indemnify and hold Bethurum harmless from and against any and all
liabilities that were incurred by Bethurum from the Closing of this Agreement
to the finalization of any such foreclosure under the said Promissory Notes.
1.10 No Reverse Splits for a Period of Three Years. Except as
provided in Section 1.4 hereof, the reorganized Bethurum shall not reverse
split its post-Agreement outstanding common stock for a period of three years
from the Closing without the prior unanimous written consent of the current
Board of Directors of Bethurum, and in the event any reverse split is effected
during that period without such prior written consent, all pre-Agreement
common stockholders of Bethurum who are also still stockholders of Bethurum
shall be immediately issued without further consideration additional shares of
Bethurum common stock so that the reverse split will have had no effect on the
number of their pre-reverse split shares of Bethurum common stock that are
still owned by any of such persons.
1.11 Limitations on other Registration Statements on
Forms S-8 or S-3 of the Securities and Exchange Commission. No registration
statements on Forms S-8 or S-3 of the Securities and Exchange Commission shall
be filed by the reorganized Bethurum for a period of three years from the
Closing to issue more than 10%, per year, of the then outstanding shares of
Bethurum common stock without the prior unanimous written consent of the
current Board of Directors of Bethurum.
1.12 Present Outstanding Securities of Bethurum and Acceptance
of Opinions of Counsel. GSL shall not contest the validity of any of the
presently outstanding shares of Bethurum common stock; and GSL, subject
to concurrence by its legal counsel with any such opinion, agrees to accept
opinions covering the resale of any of the Bethurum securities in accordance
with Rule 144 of the Securities and Exchange Commission from Leonard W.
Burningham, Esq. or Branden T. Burningham, Esq., provided that all of the
terms and provisions of Rule 144 have been or are intended to be complied with
by any selling stockholder relying on Rule 144 for whom any such opinion
has been rendered.
1.13 Condition Precedent to the Closing. The GSL Stockholder
and GSL shall have provided Bethurum with satisfactory evidence that GSL has
acquired all of the outstanding securities of Coast Drapery Service, Inc., a
Nevada corporation ("Coast Drapery"), free and clear of any liens or
encumbrances of any type or nature whatsoever, and that all of the outstanding
shares of Coast Drapery have been delivered to GSL, free and clear of any
liens or encumbrances whatsoever.
1.14 Closing. This Agreement will be deemed to be completed
on the execution and delivery of the Agreement by the sole GSL Stockholder.
Section 2
Closing
The Closing contemplated by Section 1 shall be held at the offices
of Leonard W. Burningham, Esq., Suite 205 Hermes Building, 455 East 500 South,
Salt Lake City, Utah 84111, on or before ten days following the execution and
delivery of this Agreement, unless another place or time is agreed upon in
writing by the parties. The Closing may also be accomplished by wire, express
mail or other courier service, conference telephone communications or as
otherwise agreed by the respective parties or their duly authorized
representatives.
Section 3
Representations and Warranties of Bethurum
Bethurum represents and warrants to, and covenants with, the GSL
Stockholder and GSL as follows:
3.1 Corporate Status; Compliance with Securities Laws. Bethurum
is a corporation duly organized, validly existing and in good standing under
the laws of the British Virgin Islands and is licensed or qualified as a
foreign corporation in all jurisdictions in which the nature of its business
or the character or ownership of its properties makes such licensing or
qualification necessary. Bethurum is a publicly-held company, having
previously and lawfully offered and sold a portion of its securities in
accordance with applicable United States federal and state securities laws,
rules and regulations; and Bethurum is not in violation of any such securities
laws, rules or regulations. Bethurum's common stock is quoted on the OTC
Bulletin Board of the National Association of Securities Dealers, Inc. (the
"NASD") under the symbol "BTRU," though there no "established trading market"
for these securities.
3.2 Capitalization. The current pre-Agreement authorized capital
stock of Bethurum consists of 100,000,000 shares of no par value common voting
stock, of which 1,600,750 shares are issued and outstanding, all fully paid
and non-assessable. Except as otherwise provided herein, there are no
outstanding options, warrants or calls pursuant to which any person has the
right to purchase any authorized and unissued common or other securities of
Bethurum.
3.3 Financial Statements. The financial statements of Bethurum
furnished to the GSL Stockholder and GSL, consisting of audited financial
statements for the years ended December 31, 2000 and 1999, and unaudited
financial statements for the period ended September 30, 2001, attached hereto
as Exhibits C and C-1 and incorporated herein by reference, are correct and
fairly present the financial condition of Bethurum at such dates and for the
periods involved; such statements were prepared in accordance with generally
accepted accounting principles consistently applied, and no material change
has occurred in the matters disclosed therein, except as indicated in Exhibit
D, which is attached hereto and incorporated herein by reference. Such
financial statements do not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements made,
in light of the circumstances under which they were made, not misleading.
3.4 Undisclosed Liabilities. Bethurum has no liabilities of any
nature except to the extent reflected or reserved against in its balance
sheets, whether accrued, absolute, contingent or otherwise, including, without
limitation, tax liabilities and interest due or to become due, except as set
forth in Exhibit D and Section 1.9 hereof.
3.5 Interim Changes. Since the dates of its balance sheets,
except as set forth in Exhibit D and Section 1.9 hereof, there have been no
(i) changes in financial condition, assets, liabilities or business of
Bethurum which, in the aggregate, have been materially adverse; (ii) damages,
destruction or losses of or to property of Bethurum, payments of any dividend
or other distribution in respect of any class of stock of Bethurum, or any
direct or indirect redemption, purchase or other acquisition of any class of
any such stock; or (iii) increases paid or agreed to in the compensation,
retirement benefits or other commitments to its employees.
3.6 Title to Property. Bethurum has good and marketable title to
all properties and assets, real and personal, reflected in its balance sheets,
and the properties and assets of Bethurum are subject to no mortgage, pledge,
lien or encumbrance, except for liens shown therein or in Exhibit D, with
respect to which no default exists.
3.7 Litigation. There is no litigation or proceeding pending, or
to the knowledge of Bethurum, threatened, against or relating to Bethurum, its
properties or business, except as set forth in Exhibit D. Further, no
officer, director or person who may be deemed to be an "affiliate" of Bethurum
is party to any material legal proceeding which could have an adverse effect
on Bethurum (financial or otherwise), and none is party to any action or
proceeding wherein any has an interest adverse to Bethurum.
3.8 Books and Records. From the date of this Agreement to the
Closing, Bethurum will (i) give to the GSL Stockholder and GSL or their
respective representatives full access during normal business hours to all of
Bethurum's offices, books, records, contracts and other corporate documents
and properties so that they or their respective representatives may inspect
and audit them; and (ii) furnish such information concerning the properties
and affairs of Bethurum as they or their respective representatives may
reasonably request.
3.9 Tax Returns. Bethurum has filed all United States federal
and state income or franchise tax returns required to have been filed by its
predecessor, Bethurum Laboratories, Inc., a Utah corporation; and all similar
filings required under the laws of the British Virgin Islands have been also
been filed.
3.10 Confidentiality. Until the Closing (and thereafter if
there is no Closing), Bethurum and its representatives will keep confidential
any information which they obtain from the GSL Stockholder or from GSL
concerning the properties, assets and business of GSL. If the transactions
contemplated by this Agreement are not consummated by December 31, 2001,
Bethurum will return to GSL all written matter with respect to GSL obtained by
Bethurum in connection with the negotiation or consummation of this Agreement.
3.11 Corporate Authority. Bethurum has full corporate power
and authority to enter into this Agreement and to carry out its obligations
hereunder and will deliver to the GSL Stockholder and GSL or their respective
representatives at the Closing a certified copy of resolutions of its Board of
Directors authorizing execution of this Agreement by Bethurum's officers and
performance thereunder, and that the directors adopting and delivering such
resolutions are the duly elected and incumbent directors of Bethurum.
3.12 Due Authorization. Execution of this Agreement and
performance by Bethurum hereunder have been duly authorized by all requisite
corporate action on the part of Bethurum, and this Agreement constitutes a
valid and binding obligation of Bethurum and performance hereunder will not
violate any provision of the Articles of Association or other Charter
documents, Bylaws, agreements, mortgages or other commitments of Bethurum,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
now or hereafter in effect relating to or affecting the enforcement of
creditors' right generally and the application of general equitable principles
in any action, legal or equitable.
3.13 Environmental Matters. Bethurum has no knowledge of any
assertion by any governmental agency or other regulatory authority of any
environmental lien, action or proceeding, or of any cause for any such lien,
action or proceeding related to the business operations of Bethurum. In
addition, to the best knowledge of Bethurum, there are no substances or
conditions which may support a claim or cause of action against Bethurum or
any of Bethurum' current or former officers, directors, agents or employees,
whether by a governmental agency or body, private party or individual, under
any Hazardous Materials Regulations. "Hazardous Materials" means any oil or
petrochemical products, PCB's, asbestos, urea formaldehyde, flammable
explosives, radioactive materials, solid or hazardous wastes, chemicals, toxic
substances or related materials, including, without limitation, any substances
defined as or included in the definition of "hazardous substances," "hazardous
wastes," "hazardous materials" or "toxic substances" under any applicable
federal or state laws or regulations. "Hazardous Materials Regulations" means
any regulations governing the use, generation, handling, storage, treatment,
disposal or release of hazardous materials, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, the
Resource Conservation and Recovery Act and the Federal Water Pollution Control
Act.
3.14 Access to Information Regarding GSL. Bethurum
acknowledges that it has been delivered copies of what has been represented to
be documentation containing all material information respecting GSL (including
its wholly-owned subsidiary, Coast Drapery), and GSL's present and
contemplated business operations, potential acquisitions, management and other
factors; that it has had a reasonable opportunity to review such documentation
and discuss it, to the extent desired, with its legal counsel, directors and
executive officers; that it has had, to the extent desired, the opportunity to
ask questions of and receive responses from the directors and executive
officers of GSL, and with the legal and accounting firms of GSL, with respect
to such documentation; and that to the extent requested, all questions raised
have been answered to Bethurum's complete satisfaction.
Section 4
Representations, Warranties and Covenants of GSL,
the GSL Stockholder and Coast Drapery, a Wholly- Owned Subsidiary of
GSL
GSL, the GSL Stockholder and Coast Drapery represent and
warrant to, and covenant with, Bethurum as follows:
4.1 Ownership of GSL. The GSL Stockholder owns the GSL Shares free
and clear of any liens or encumbrances of any type or nature whatsoever, and
has full right, power and authority to convey the GSL Shares that are owned by
it without qualification.
4.2 Ownership of Coast Drapery. GSL owns 100% of the Coast Drapery
shares free and clear of any liens or encumbrances of any type or nature
whatsoever, and has full right, power and authority to convey the Coast
Drapery shares that it owns without qualification.
4.3 Corporate Status of GSL. GSL is a corporation duly organized,
validly existing and in good standing under the laws of the Cayman Islands,
British West Indies, and is licensed or qualified as a foreign corporation in
all jurisdictions or foreign countries and provinces in which the nature of
GSL's business or the character or ownership of GSL properties makes such
licensing or qualification necessary. It has one subsidiary that is
wholly-owned, Coast Drapery.
4.4 Corporate Status of Coast Drapery. Coast Drapery is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Nevada, United States, and is licensed or qualified as a
foreign corporation in all states of the United States or foreign countries
and provinces in which the nature of its business or the character or
ownership of its properties makes such licensing or qualification necessary.
4.5 Capitalization of GSL. The authorized capital stock of GSL
consists of 50,000 shares of common stock, $1.00 par value per share, of which
one (1) share is issued and outstanding, and which is fully paid and
non-assessable. Except for an option with no expiration date to acquire
250,000 shares of GSL common stock at $1.00 per share that was granted to
Sobel Westex, a Nevada corporation ("Sobel"), from which the GSL Stockholder
acquired Coast Drapery prior to its acquisition by GSL, there are no
outstanding options, warrants or calls pursuant to which any person has the
right to purchase any authorized and unissued common or other securities of
GSL.
4.6 Capitalization of Coast Drapery. The authorized capital stock
of Coast Drapery consists of 2,500 shares of common stock, no par value per
share, of which 100 shares are issued and outstanding, all fully paid and
non-assessable. Except as provided herein, there are no outstanding options,
warrants or calls pursuant to which any person has the right to purchase any
authorized and unissued common or other securities of Coast Drapery.
4.7 Financial Statements. The financial statements of GSL, which
consist solely of the financial statements of Coast Drapery furnished to
Bethurum, consisting of an unaudited compiled balance sheet and income
statement for the period ended March 31, 2001, attached hereto as Exhibit E
and incorporated herein by reference, are correct and fairly present the
combined financial condition of GSL and Coast Drapery as of these dates and
for the periods involved; such statements were prepared in accordance with
generally accepted accounting principles consistently applied, and no material
change has occurred in the matters disclosed therein, except as indicated in
Exhibit F, which is attached hereto and incorporated herein by reference.
These financial statements do not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements made, in light of the circumstances under which they were made, not
misleading.
4.8 Undisclosed Liabilities of GSL. GSL has no material
liabilities of any nature except to the extent reflected or reserved against
in the Coast Drapery balance sheet, whether accrued, absolute, contingent or
otherwise, including, without limitation, tax liabilities and interest due or
to become due, except as set forth in Exhibit F.
4.9 Undisclosed Liabilities of Coast Drapery. Coast Drapery has no
material liabilities of any nature except to the extent reflected or reserved
against in its balance sheet, whether accrued, absolute, contingent or
otherwise, including, without limitation, tax liabilities and interest due
or to become due, except as set forth in Exhibit F.
4.10 Interim Changes of GSL. Since the dates of its
balance sheet, except as set forth in Exhibit F, there have been no (i)
changes in the financial condition, assets, liabilities or business of
GSL, which in the aggregate, have been materially adverse; (ii) damages,
destruction or loss of or to the property of GSL, payment of any dividend or
other distribution in respect of the capital stock of GSL, or any direct or
indirect redemption, purchase or other acquisition of any such stock; or (iii)
increases paid or agreed to in the compensation, retirement benefits or other
commitments to their employees.
4.11 Interim Changes of Coast Drapery. Since the dates of its
balance sheet, except as set forth in Exhibit F, there have been no (i)
changes in the financial condition, assets, liabilities or business of Coast
Drapery, which in the aggregate, have been materially adverse; (ii) damages,
destruction or loss of or to the property of Coast Drapery, payment of any
dividend or other distribution in respect of the capital stock of Coast
Drapery, or any direct or indirect redemption, purchase or other acquisition
of any such stock; or (iii) increases paid or agreed to in the compensation,
retirement benefits or other commitments to their employees.
4.12 Title to Property of GSL. GSL has good and marketable
title to all properties and assets, real and personal, proprietary or
otherwise, reflected in the Coast Drapery balance sheet, and the properties
and assets of GSL are subject to no mortgage, pledge, lien or encumbrance,
except as reflected in the balance sheet or in Exhibit F, with respect to
which no default exists.
4.13 Title to Property of Coast Drapery. Coast Drapery has
good and marketable title to all properties and assets, real and personal,
proprietary or otherwise, reflected in its balance sheet, and the properties
and assets of Coast Drapery are subject to no mortgage, pledge, lien or
encumbrance, except as reflected in the trial balance sheet or in Exhibit F,
with respect to which no default exists.
4.14 Litigation of GSL. There is no litigation or proceeding
pending, or to the knowledge of GSL, threatened, against or relating to GSL or
its properties or business, except as set forth in Exhibit F. Further, no
officer, director or person who may be deemed to be an affiliate of GSL
is party to any material legal proceeding which could have an adverse effect
on GSL (financial or otherwise), and none is party to any action or proceeding
wherein any has an interest adverse to GSL.
4.15 Litigation of Coast Drapery. There is no litigation or
proceeding pending, or to the knowledge of Coast Drapery, threatened, against
or relating to Coast Drapery or its properties or business, except as set
forth in Exhibit F. Further, no officer, director or person who may be deemed
to be an affiliate of Coast Drapery is party to any material legal proceeding
which could have an adverse effect on Coast Drapery (financial or otherwise),
and none is party to any action or proceeding wherein any has an interest
adverse to Coast Drapery.
4.16 Books and Records of GSL. From the date of this Agreement
to the Closing, the GSL Stockholder will cause GSL to (i) give to Bethurum and
its representatives full access during normal business hours to all of its
offices, books, records, contracts and other corporate documents and
properties so that Bethurum may inspect and audit them; and (ii) furnish such
information concerning the properties and affairs of GSL as Bethurum may
reasonably request.
4.17 Books and Records of Coast Drapery. From the date of this
Agreement to the Closing, the Coast Drapery will (1) give to Bethurum and its
representatives full access during normal business hours to all of its
offices, books, records, contracts and other corporate documents and
properties so that Bethurum may inspect and audit them; and (2) furnish such
information concerning the properties and affairs of Coast Drapery as Bethurum
may reasonably request.
4.18 Tax Returns of GSL. GSL has filed all income or
franchise tax returns required to be filed or has received currently effective
extensions of the required filing dates.
4.19 Tax Returns of Coast Drapery. Coast Drapery has filed all
United States federal and state income or franchise tax returns required to be
filed or has received currently effective extensions of the required filing
dates.
4.20 Confidentiality. Until the Closing (and continuously if
there is no Closing), GSL, the GSL Stockholder and Coast Drapery will keep
confidential any information which they obtain from Bethurum concerning its
properties, assets and business. If the transactions contemplated by this
Agreement are not consummated by December 31, 2001, GSL and the GSL
Stockholder will return to Bethurum all written matter with respect to
Bethurum obtained by them in connection with the negotiation or consummation
of this Agreement.
4.21 Investment Intent. The GSL Stockholder is acquiring the
securities to be exchanged and delivered to it under this Agreement for
investment and not with a view to the sale or distribution thereof, and it has
no commitment or present intention to sell or distribute the Bethurum
securities to be received hereunder. The GSL Stockholder shall execute and
deliver to Bethurum on the Closing an Investment Letter attached hereto as
Exhibit G and incorporated herein by reference.
4.22 Corporate Authority of GSL. GSL and the GSL Stockholder
have full corporate power and authority to enter into this Agreement and to
carry out their obligations hereunder and will deliver to Bethurum or its
representative at the Closing a certified copies of resolutions of their
Boards of Directors authorizing execution of this Agreement by their officers
and performance thereunder.
4.23 Due Authorization. Execution of this Agreement and
performance by GSL and the GSL Stockholder hereunder have been duly authorized
by all requisite corporate action on the part of GSL and the GSL Stockholder,
and this Agreement constitutes a valid and binding obligation of GSL
and the GSL Stockholder and performance hereunder will not violate any
provision of the Articles of Incorporation or other Charter documents, Bylaws,
agreements, mortgages or other commitments of GSL or the GSL Stockholder,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
now or hereafter in effect relating to or affecting the enforcement of
creditors' right generally and the application of general equitable principles
in any action, legal or equitable.
4.24 Environmental Matters. GSL has no knowledge of any
assertion by any governmental agency or other regulatory authority of any
environmental lien, action or proceeding, or of any cause for any such lien,
action or proceeding related to the business operations of GSL or its
predecessors. In addition, to the best knowledge of GSL, there are no
substances or conditions which may support a claim or cause of action against
GSL or any of its current or former officers, directors, agents, employees or
predecessors, whether by a governmental agency or body, private party or
individual, under any Hazardous Materials Regulations. "Hazardous Materials"
means any oil or petrochemical products, PCB's, asbestos, urea formaldehyde,
flammable explosives, radioactive materials, solid or hazardous wastes,
chemicals, toxic substances or related materials, including, without
limitation, any substances defined as or included in the definition of
"hazardous substances," "hazardous wastes," " hazardous materials" or "toxic
substances" under any applicable federal or state laws or regulations.
"Hazardous Materials Regulations" means any regulations governing the use,
generation, handling, storage, treatment, disposal or release of hazardous
materials, including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act, the Resource Conservation and
Recovery Act and the Federal Water Pollution Control Act.
4.25 Access to Information Regarding Bethurum. GSL and the GSL
Stockholder acknowledge that they have been delivered copies of what has been
represented to be documentation containing all material information respecting
Bethurum and its present and contemplated business operations, potential
acquisitions, management and other factors, by delivery to them and/or by
access to such information in the EDGAR Archives of the Securities and
Exchange Commission at www.sec.gov; that they have had a reasonable
opportunity to review such documentation and to discuss it, to the extent
desired, with their legal counsel, directors and executive officers; that they
have had, to the extent desired, the opportunity to ask questions of and
receive responses from the sole director and executive officer of Bethurum,
and with the legal and accounting firms of Bethurum, with respect to such
documentation; and that to the extent requested, all questions raised have
been answered to their complete satisfaction.
Section 5
Conditions Precedent to Obligations of GSL
and the GSL Stockholder
All obligations of GSL and the GSL Stockholder under this Agreement are
subject, at their option, to the fulfillment, before or at the Closing, of
each of the following conditions:
5.1 Representations and Warranties True at Closing. The
representations and warranties of Bethurum contained in this Agreement shall
be deemed to have been made again at and as of the Closing and shall then be
true in all material respects and shall survive the Closing.
5.2 Due Performance. Bethurum shall have performed and complied
with all of the terms and conditions required by this Agreement to be
performed or complied with by it before the Closing.
5.3 Officers' Certificate. GSL shall have been furnished with a
certificate signed by the President of Bethurum, in such capacity, attached
hereto as Exhibit H and incorporated herein by reference, dated as of the
Closing, certifying (i) that all representations and warranties of Bethurum
contained herein are true and correct; and (ii) that since the date of the
financial statements (Exhibits C and C-1 hereto), there has been no material
adverse change in the financial condition, business or properties of Bethurum,
taken as a whole.
5.4 Assets and Liabilities of Bethurum. Unless otherwise agreed,
Bethurum shall have no assets and no liabilities at Closing, and all costs,
expenses and fees incident to the Agreement shall have been paid, except as
set forth in Exhibit D and Section 1.9.
5.5 Resignations of Present Directors and Executive Officers and
Designation of New Directors and Executive Officers. At or simultaneous with
the Closing, corporate resolutions of Bethurum shall have adopted all action
necessary to accomplish the resignation of Bethurum's directors and executive
officers and the designation of the nominees of the GSL Stockholder to the
Board of Directors and to serve as officers as outlined in Section 1.6 hereof.
5.6 Change of Name and Capitalization. At or simultaneous to the
Closing of this Agreement, the Board of Directors of Bethurum shall change its
name to "GSL Group, Inc."; and within 45 days of Closing, the reverse split
and changes to the capitalization of Bethurum outlined in Section 1.4 shall
have been completed.
Section 6
Conditions Precedent to Obligations of Bethurum
All obligations of Bethurum under this Agreement are subject, at
Bethurum's option, to the fulfillment, before or at the Closing, of each of
the following conditions:
6.1 Representations and Warranties True at Closing. The
representations and warranties of GSL, the GSL Stockholder and Coast Drapery
contained in this Agreement shall be deemed to have been made again at and as
of the Closing and shall then be true in all material respects and shall
survive the Closing.
6.2 Due Performance. GSL and the GSL Stockholder shall have
performed and complied with all of the terms and conditions required by this
Agreement to be performed or complied with by them before the Closing.
6.3 Officers' Certificate. Bethurum shall have been furnished with
a certificate signed by the President of GSL, in such capacity, attached
hereto as Exhibit I and incorporated herein by reference, dated as of the
Closing, certifying (i) that all representations and warranties of GSL and
the GSL Stockholder contained herein are true and correct; and (ii) that since
the date of the financial statements (Exhibit E), there has been no material
adverse change in the financial condition, business or properties of GSL,
taken as a whole.
6.4 Books and Records. The GSL Stockholder or the Board of
Directors of GSL shall have caused GSL to make available all books and records
of GSL, including minute books and stock transfer records; provided, however,
only to the extent requested in writing by Bethurum at Closing.
6.5 Compliance With Specific Conditions of Section 1. All of the
requirements of Section 1.9 are conditions precedent to the Closing of this
Agreement and obligations of Bethurum hereunder, and must be fully satisfied
at or prior to the Closing; and Sections 1.10, 1.11 and 1.12 are conditions
subsequent that the current members of the Board of Directors of Bethurum may
obtain specific performance of in the event of default in any of the matters
covered thereby, along with the default provisions of Exhibits B and B-1 that
are outlined in Section 1.9.
6.6 Stockholder's Consent. The sole stockholder of the outstanding
GSL Shares shall have executed and delivered the Agreement.
Section 7
Termination
Prior to Closing, this Agreement may be terminated (1) by mutual
consent in writing; (2) by either the directors of Bethurum or GSL if there
has been a material misrepresentation or material breach of any warranty or
covenant by the other party; or (3) by either the directors of Bethurum or GSL
and the GSL Stockholder, if the Closing shall not have taken place, unless
adjourned to a later date by mutual consent in writing, by the date fixed in
Section 2.
Section 8
General Provisions
8.1 Further Assurances. At any time, and from time to time, after
the Closing, each party will execute such additional instruments and take such
action as may be reasonably requested by the other party to confirm or perfect
title to any property transferred hereunder or otherwise to carry out
the intent and purposes of this Agreement.
8.2 Waiver. Any failure on the part of any party hereto to comply
with any its or their obligations, agreements or conditions hereunder may be
waived in writing by the party to whom such compliance is owed.
8.3 Brokers. Each party represents to the other parties hereunder
that no broker or finder has acted for it in connection with this Agreement,
and agrees to indemnify and hold harmless the other parties against any fee,
loss or expense arising out of claims by brokers or finders employed or
alleged to have been employed by he/she/it.
8.4 Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been given if delivered in person or
sent by prepaid first-class registered or certified mail, return receipt
requested, as follows:
If to Bethurum: 6371 Richmond Avenue, Suite 200
Houston, Texas 77057
With a copy to: Leonard W. Burningham, Esq.
455 East 500 South, #205
Salt Lake City, Utah 84111
If to GSL: Scotia Centre, 4th Floor
P. O. box 2804
George Town, Grand Cayman
Cayman Islands, British West Indies
With a copy to: Christopher H. Dieterich, Esq.
Dieterich & Associates
11300 W. Olympic Boulevard, Suite 800
Los Angeles, California 90064
If to the GSL c/o Mai Wong
Stockholder: 17F/D Lok Moon Mansion
39-41 Queen's Road
East Wanchi, Hong Kong
8.5 Entire Agreement. This Agreement constitutes the entire
agreement between the parties and supersedes and cancels any other agreement,
representation or communication, whether oral or written, between the parties
hereto relating to the transactions contemplated herein or the subject
matter hereof.
8.6 Headings. The section and subsection headings in this
Agreement are inserted for convenience only and shall not affect in any way
the meaning or interpretation of this Agreement.
8.7 Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the British Virgin
Islands, except to the extent that it is preempted by United States law or the
laws of any state of the United States, in which event (and to that
extent only), United States or such state law shall govern. Any actions
permitted hereunder that are not governed by the laws of the British Virgin
Islands shall be brought in the State of Texas in the county in which the
present principal executive offices of Bethurum are situated only.
8.8 Assignment. This Agreement shall inure to the benefit of, and
be binding upon, the parties hereto and their successors and assigns.
8.9 Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
8.10 Default. In the event of any default hereunder, the
prevailing party in any action to enforce the terms and provisions hereof
shall be entitled to recover reasonable attorney's fees and related costs.
IN WITNESS WHEREOF, the parties have executed this Agreement and
Plan of Reorganization effective the latest date hereof.
BETHURUM LABORATORIES, LTD.
Date: 12/20/01 By/s/William A. Silvey, Jr.
William A. Silvey, Jr., President
GLOBAL STARLINK GROUP, INC.
Date: 12/21/01 By/s/Mai Wong
Mai Wong, Chairman
THE GSL STOCKHOLDER
ALLSTATE DEVELOPMENT LTD.
Dare: 12/21/01 By/s/Mai Wong
Mai Wong, Chairman
EXHIBIT A
Number of Shares of
Number of Shares Bethurum
Owned of to be
Name GSL Received in Exchange
Allstate Development Ltd. 1 30,400,000
Scotia Centre, 4th Floor
P. O. Box 2804
George Town, Grand Cayman
Cayman Islands, British West Indies
EXHIBIT B
PROMISSORY NOTE
FOR VALUE RECEIVED, the undersigned, Bethurum Laboratories, Ltd. ("BTRU")
jointly and severally promise to pay to the order of William A. Silvey,
Jr.("Silvey" or "Holder") the sum of ONE-HUNDRED SEVENTY-FIVE THOUSAND U.S.
Dollars ($175,000 usd). Said sum shall be paid in the manner following:
1. Payment in certified or readily available funds of $25,000 usd to be
deposited in the trust account of Leonard W. Burningham, Esq. on or
before close of business, 5:00 PM Pacific Standard Time, December 31,
2001, which shall be in turn paid by Leonard W. Burningham, Esq.,
Trustee, to the designees of BTRU, solely as directed by William A.
Silvey, Jr.
2. Payment in certified or readily available funds of $75,000 usd to be
deposited in the trust account of Leonard W. Burningham, Esq. on or
before close of business, 5:00 PM Pacific Standard Time, March 1, 2002,
which shall be in turn paid by Leonard W. Burningham, Esq., Trustee, to
the designees of BTRU, solely as directed by William A. Silvey, Jr.
3. Payment in certified or readily available funds of $75,000 usd to be
deposited in the trust account of Leonard W. Burningham, Esq. on or
before close of business, 5:00 PM Pacific Standard Time, June 1, 2002,
which shall be in turn paid by Leonard W. Burningham, Esq., Trustee, to
the designees of BTRU, solely as directed by William A. Silvey, Jr.
All payments shall be first applied to principal.
This note may be prepaid, at any time, in whole or in part, without penalty.
This Promissory Note can be assigned as directed by William A. Silvey, Jr.
upon closing of the Agreement and Plan of Reorganization among and between
Global Starlink Holdings, Inc., a Cayman Islands, BWI corporation ("GSL"), the
GSL sole stockholder, Allstate Development Ltd., a Hong Kong business entity
(the "GSL Stockholder"), and BTRU (the "Plan").
Th Promissory Note obligation can be assumed with the mutual consent of BTRU
and William A. Silvey, Jr. of Bethurum. Such consent shall not be
unreasonably withheld.
This note shall at the option of any holder hereof be immediately due and
payable upon the occurrence of any of the following:
1. Failure to make any payment due hereunder within 10 days of its due
date.
2. Breach of any condition of any security interest, mortgage, pledge
agreement or guarantee granted as collateral security for this note.
3. Breach of any condition of any security agreement or mortgage, if any,
having a priority over any security agreement or mortgage on collateral
granted, in whole or in part, as collateral security for this note.
4. Upon the death, dissolution or liquidation of any of the undersigned, or
any endorser, guarantor or surety hereto.
5. Upon the filing be any of the undersigned of an assignment for the
benefit of creditors, bankruptcy, or for relief under any provisions of
the Bankruptcy Code; or by suffering an involuntary petition in
bankruptcy or receivership not vacated within thirty days.
In the event BTRU fails to make a timely scheduled payment to Silvey, BTRU
shall pay liquidated damages of $15,000 which shall be payable with the next
scheduled payment. In the event BTRU misses a second consecutive payment,
Silvey shall have the right to foreclose on BTRU or to receive additional
liquidated damages from BTRU in the amount of $30,000. In the event that the
current Board of Directors of BTRU forecloses on BTRU, the current Board of
Directors shall receive the greater of (i)(a) the number of shares outstanding
less 1,600,750 shares multiplied by (b) payments made by BTRU divided by
$500,000 or (ii) shares consisting of 51% of the issued and outstanding shares
of BTRU whichever is greater.
The $175,000 shall pay Silvey (i) non-accountable expenses including but not
limited to, costs accrued in the reinstatement and maintenance of the BTRU's
corpus; any and all outstanding obligations of BTRU pre-Plan, legal,
accounting, management and other professional fees and costs incurred by BTRU
pursuant to the Plan determined by the current Board of Directors in its sole
discretion, (ii) BTRU's current Board of Directors for their representations,
warranties, and indemnifications, as to BTRU having no material liabilities,
parenthetical, contingent or real at Closing of the Agreement and Plan of
Reorganization among and between BTRU and GSL and the GSL Stockholder.
If is understood by the Parties that Leonard W. Burningham, Esq. shall nave no
liability by reason of acting as Escrow Agent except for acts of malfeasance
or intentional wrongdoing and will act only in good faith and pursuant to the
written instructions of the current Board of Directors of BTRU.
In the event this note shall be in default, and placed with an attorney for
collection, then the undersigned agree to pay all reasonable attorney fees and
costs of collection. Payments not made within five days of due date shall be
subject to a late charge of ten percent (10%) of said payment. All payments
hereunder shall be made to such address as may from time to time be designated
by any holder hereof.
The undersigned and all other parties to this note, whether as endorsers,
guarantors or sureties, agree to remain fully bound hereunder until this note
shall be fully paid and waive demand, presentment and protest and all notices
thereto, and further agree to remain bound, notwithstanding any extension,
modification, waiver, or other indulgence by any holder or upon the discharge
or
release of any obligor hereunder or to this note, or upon the exchange,
substitution, or release of any collateral granted as security for this note.
No modification or indulgence by any holder hereof shall be binding unless in
writing; and any indulgence on any one occasion shall not be an indulgence for
any other of future occasion. Any modification or change of terms, hereunder
granted by any holder hereof, shall be valid and binding upon each of the
undersigned, notwithstanding the acknowledgment of any of the undersigned, and
each of the undersigned does hereby irrevocably grant to each of the others a
power of attorney to enter into any such modification on their behalf. The
rights of any holder hereof shall be cumulative and not necessarily
successive.
This note shall take effect as a sealed instrument and shall be construed,
governed and enforced in accordance with the laws of the State of Utah.
Undersigned,
BETHURUM LABORATORIES, LTD.
Dated: 12/20/01 /S/W. A. Silvey, Jr.
By:W. A. Silvey, Jr. President
EXHIBIT B-1
PROMISSORY NOTE
FOR VALUE RECEIVED, the undersigned, Bethurum Laboratories, Ltd. ("BTRU")
jointly and severally promise to pay to the order of W. Scott Thompson (the
"Thompson" or "Holder") the sum of ONE-HUNDRED SEVENTY-FIVE THOUSAND U.S.
Dollars ($175,000 usd). Said sum shall be paid in the manner following:
1. Payment in certified or readily available funds of $25,000 usd to be
deposited in the trust account of Leonard W. Burningham, Esq. on or
before close of business, 5:00 PM Pacific Standard Time, December 31,
2001, which shall be in turn paid by Leonard W. Burningham, Esq.,
Trustee, to the designees of BTRU, solely as directed by W. Scott
Thompson
2. Payment in certified or readily available funds of $75,000 usd to be
deposited in the trust account of Leonard W. Burningham, Esq. on or
before close of business, 5:00 PM Pacific Standard Time, March 1, 2002,
which shall be in turn paid by Leonard W. Burningham, Esq., Trustee, to
the designees of BTRU, solely as directed by W. Scott Thompson
3. Payment in certified or readily available funds of $75,000 usd to be
deposited in the trust account of Leonard W. Burningham, Esq. on or
before close of business, 5:00 PM Pacific Standard Time, June 1, 2002,
which shall be in turn paid by Leonard W. Burningham, Esq., Trustee, to
the designees of BTRU, solely as directed by W. Scott Thompson
All payments shall be first applied to principal.
This note may be prepaid, at any time, in whole or in part, without penalty.
This Promissory Note can be assigned as directed by W. Scott Thompson upon
closing of the Agreement and Plan of Reorganization among and between Global
Starlink Holdings, Inc., a Cayman Islands, BWI corporation ("GSL"), the GSL
sole stockholder, Allstate Development Ltd., a Hong Kong business entity (the
"GSL Stockholder"), and BTRU (the "Plan").
The Promissory Note obligation can be assumed with the mutual consent of BTRU
and W. Scott Thompson of Bethurum. Such consent shall not be unreasonably
withheld.
This note shall at the option of any holder hereof be immediately due and
payable upon the occurrence of any of the following:
1. Failure to make any payment due hereunder within 10 days of its due
date.
2. Breach of any condition of any security interest, mortgage, pledge
agreement or guarantee granted as collateral security for this note.
3. Breach of any condition of any security agreement or mortgage, if any,
having a priority over any security agreement or mortgage on collateral
granted, in whole or in part, as collateral security for this note.
4. Upon the death, dissolution or liquidation of any of the undersigned, or
any endorser, guarantor or surety hereto.
5. Upon the filing be any of the undersigned of an assignment for the
benefit of creditors, bankruptcy, or for relief under any provisions of
the Bankruptcy Code; or by suffering an involuntary petition in
bankruptcy or receivership not vacated within thirty days.
In the event BTRU fails to make a timely scheduled payment to Thompson, BTRU
shall pay liquidated damages of $15,000 which shall be payable with the next
scheduled payment. In the event BTRU misses a second consecutive payment,
Thompson shall have the right to foreclose on BTRU or to receive additional
liquidated damages from BTRU in the amount of $30,000. In the event that the
current Board of Directors of BTRU forecloses on BTRU, the current Board of
Directors shall receive the greater of (i)(a) the number of shares outstanding
less 1,600,750 shares multiplied by (b) payments made by BTRU divided by
$500,000 or (ii) shares consisting of 51% of the issued and outstanding shares
of BTRU whichever is greater.
The $175,000 shall pay Thompson (i) non-accountable expenses including but not
limited to, costs accrued in the reinstatement and maintenance of the BTRU's
corpus; any and all outstanding obligations of BTRU pre-Plan, legal,
accounting, management and other professional fees and costs incurred by BTRU
pursuant to the Plan determined by the current Board of Directors in its sole
discretion, (ii) BTRU's current Board of Directors for their representations,
warranties, and indemnifications, as to BTRU having no material liabilities,
parenthetical, contingent or real at Closing of the Agreement and Plan of
Reorganization among and between BTRU and GSL and the GSL Stockholder.
If is understood by the Parties that Leonard W. Burningham, Esq. shall nave no
liability by reason of acting as Escrow Agent except for acts of malfeasance
or intentional wrongdoing and will act only in good faith and pursuant to the
written instructions of the current Board of Directors of BTRU.
In the event this note shall be in default, and placed with an attorney for
collection, then the undersigned agree to pay all reasonable attorney fees and
costs of collection. Payments not made within five days of due date shall be
subject to a late charge of ten percent (10%) of said payment. All payments
hereunder shall be made to such address as may from time to time be designated
by any holder hereof.
The undersigned and all other parties to this note, whether as endorsers,
guarantors or sureties, agree to remain fully bound hereunder until this note
shall be fully paid and waive demand, presentment and protest and all notices
thereto, and further agree to remain bound, notwithstanding any extension,
modification, waiver, or other indulgence by any holder or upon the discharge
or release of any obligor hereunder or to this note, or upon the exchange,
substitution, or release of any collateral granted as security for this note.
No modification or indulgence by any holder hereof shall be binding unless in
writing; and any indulgence on any one occasion shall not be an indulgence for
any other of future occasion. Any modification or change of terms, hereunder
granted by any holder hereof, shall be valid and binding upon each of the
undersigned, notwithstanding the acknowledgment of any of the undersigned, and
each of the undersigned does hereby irrevocably grant to each of the others a
power of attorney to enter into any such modification on their behalf. The
rights of any holder hereof shall be cumulative and not necessarily
successive. This note shall take effect as a sealed instrument and shall be
construed, governed and enforced in accordance with the laws of the State of
Utah.
Undersigned,
BETHURUM LABORATORIES, LTD.
Dated: 12/20/01 /S/W. A. Silvey, Jr.
By: W. A. Silvey, Jr., President
EXHIBIT C
BETHURUM LABORATORIES, LTD.
AUDITED FINANCIAL STATEMENTS
FOR THE YEARS ENDED
DECEMBER 31, 2000 and 1999
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
December 31, 2000
C O N T E N T S
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . 3
Balance Sheet. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Statements of Operations . . . . . . . . . . . . . . . . . . . . . . . 5
Statements of Stockholders' Equity (Deficit) . . . . . . . . . . . . . 6
Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . 9
Notes to the Financial Statements. . . . . . . . . . . . . . . . . . . 10
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Bethurum Laboratories, Inc.
(A Development Stage Company)
Salt Lake City, Utah
We have audited the accompanying balance sheet of Bethurum Laboratories, Inc.,
(a development stage company), as of December 31, 2000 and the related
statements of operations, stockholders' equity (deficit), and cash flows for
the years ended December 31, 2000 and 1999 and for the period from inception
on April 22, 1983 through December 31, 2000. These financial statements are
the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the 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. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Bethurum Laboratories, Inc.
(a development stage company), as of December 31, 2000 and the results of its
operations and its cash flows for the years ended December 31, 2000 and 1999
and for the period from inception on April 22, 1983 through December 31, 2000
in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company is a development stage company with no
significant operating results to date, which raises substantial doubt about
its ability to continue as a going concern. Management's plans in regard to
these matters are also described in Note 2. The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
HJ & Associates, LLC
Salt Lake City, Utah
March 29, 2000
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Balance Sheet
ASSETS
December 31,
2000
CURRENT ASSETS
Cash $ -
Total Current Assets -
TOTAL ASSETS $ -
LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 3,007
Total Liabilities 3,007
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock; authorized 100,000,000 common
shares at $0.001 par value; 3,300,750
shares issued and outstanding 3,301
Additional paid-in capital 346,174
Subscription receivable (100,000)
Deficit accumulated during development stage (252,482)
Total Stockholders' Equity (Deficit) (3,007)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ -
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Statements of Operations
From
Inception on
April 22,
For the Years Ended 1983 Through
December 31, December 31,
2000 1999 2000
REVENUES $ - $ - $ -
EXPENSES
General and administrative 244,787 4,404 288,727
Total Expenses 244,787 4,404 288,727
LOSS FROM OPERATIONS (244,787) (4,404) (288,727)
OTHER (EXPENSE) INCOME
Other income 40,000 - 40,000
Interest expense - (1,647) (3,755)
Total Other (Expense) Income 40,000 (1,647) 36,245
NET LOSS $ (204,787) $ (6,051) $(252,482)
BASIC AND DILUTED LOSS PER SHARE $ (0.10) $ (0.02)
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 1,970,832 350,750
BETHURUM LABORATORIES, INC.
(A Development Company)
Statements of Stockholders' Equity (Deficit)
From Inception on April 22, 1983 to December 31, 2000
Deficit
Accumulated
Additional Stock During the
Common Stock Paid-in Subscription Development
Shares Amount Capital Receivable Stage
Balance on inception - $ - $ - $ - $ -
Issuance of common
stock for cash at
inception at
approximately $.05
per share 30,000 30 1,470 - -
Issuance of common
stock for cash at
$0.06 per share 250,000 250 14,750 - -
Common stock issued
during
reorganization
agreement 1,000,000 1,000 (1,000) - -
Cancellation of
common stock
from divestiture
agreement (975,000) (975) 975 - -
Net loss from
inception on
April 22, 1983
through
December 31, 1986 - - - - (18,049)
Balance,
December 31, 1986 305,000 305 16,195 - -
Net loss for
the year ended
December 31, 1987 - - - - (124)
Balance,
December 31, 1987 305,000 305 16,195 - (18,173)
Net loss for
the year ended
December 31, 1988 - - - - (134)
Balance,
December 31, 1988 305,000 305 16,195 - (18,307)
Net loss for
the year ended
December 31, 1989 - - - - (144)
Balance,
December 31, 1989 305,000 305 16,195 - (18,451)
Net loss for
the year ended
December 31, 1990 - - - - (156)
Balance,
December 31, 1990 305,000 $ 305 $ 16,195 $ - $ (18,607)
Net loss for
the year ended
December 31, 1991 - - - - (169)
Balance,
December 31, 1991 305,000 305 16,195 - (18,776)
Net loss for
the year ended
December 31, 1992 - - - - (182)
Balance,
December 31, 1992 305,000 305 16,195 - (18,958)
Net loss for
the year ended
December 31, 1993 - - - - (196)
Balance,
December 31, 1993 305,000 305 16,195 - (19,154)
Net loss for
the year ended
December 31, 1994 - - - - (213)
Balance,
December 31, 1994 305,000 305 16,195 - (19,367)
Net loss for
the year ended
December 31, 1995 - - - - (229)
Balance,
December 31, 1995 305,000 305 16,195 - (19,596)
Expenses paid
on the Company's
behalf - - 473 - -
Net loss for
the year ended
December 31, 1996 - - - - (6,385)
Balance,
December 31, 1996 305,000 305 16,668 - (25,981)
Expenses paid on
the Company's
behalf - - 3,167 - -
Net loss for
the year ended
December 31, 1997 - - - - (422)
Balance,
December 31, 1997 305,000 $ 305 $ 19,835 $ - $ (26,403)
Expenses paid on
the Company's
behalf - - 1,218 - -
Common stock issued
for services at
$0.10 per share 45,750 46 4,529 - -
Net loss for
the year ended
December 31, 1998 - - - - (15,241)
Balance,
December 31, 1998 350,750 351 25,582 - (41,644)
Expenses paid
on the Company's
behalf (unaudited) - - 5,754 - -
Net loss for
the year
ended December
31, 1999 - - - - (6,051)
Balance,
December 31, 1999 350,750 $ 351 $ 31,336 $ - $ (47,695)
Expenses paid on
Company's behalf - - 5,288 - -
Common stock issued for
cash at $0.01 per
share 1,250,000 1,250 11,250 - -
Common stock issued
for cash at $0.12 per
share 1,700,000 1,700 298,300 (100,000) -
Net loss for the year
ended December 31,
2000 - - - - (204,787)
Balance, December 31,
2000 3,300,750 $ 3,301 $ 346,174 $(100,000) $(252,482)
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Statements of Cash Flows
From
Inception on
April 22,
For the Years Ended 1983 Through
December 31, December 31,
2000 1999 2000
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (204,787) $ (6,051) $ (252,482)
Adjustments to reconcile net loss to
net cash (used) by operating activities:
Common stock issued for services - - 4,575
Changes in operating assets and
liabilities:
Increase (decrease) in accounts payable (11,354) (1,350) 3,007
Increase (decrease) in accrued interest (1,647) 1,647 -
Net Cash (Used) by Operating
Activities (217,788) (5,754) (244,900)
CASH FLOWS FROM INVESTING ACTIVITIES - - -
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of common stock 212,500 - 229,000
Additional paid-in capital 5,288 5,754 15,900
Net Cash Provided by Financing
Activities 217,788 5,754 244,900
NET INCREASE IN CASH - - -
CASH AT BEGINNING OF PERIOD - - -
CASH AT END OF PERIOD $ - $ - $ -
CASH PAID FOR:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
SCHEDULE OF NON-CASH FINANCING ACTIVITIES
Common stock issued for services $ - $ - $ 4,575
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Notes the Financial Statements
December 31, 2000 and 1999
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
The financial statements presented are those of Bethurum
Laboratories, Inc., (a development stage company). The Company was
incorporated in the State of Utah on April 22, 1983 under the name
Lion Resources, Inc. The Company was incorporated for the purpose of
seeking business opportunities by mergers, acquisitions and/or asset
purchases. The Company has redomiciled to the British Virgin
Islands.
On October 24, 1983, the Company acquired 100% of the outstanding
stock of Bethurum Laboratories, Inc. (a Texas corporation) (BLI)
through the issuance of 10,000,000 shares of its restricted common
stock. In connection with the acquisition, the Company changed its
name to Bethurum Laboratories, Inc. on October 27, 1983. In January
1985, the acquisition agreement was canceled due to non-performance
of BLI. Ownership of BLI was returned to its former shareholders,
and the shares issued by the Company in connection with the
acquisition were canceled with the exception of 250,000 shares which
were not returned.
On October 24, 1983 and in conjunction with the reorganization
agreement the Company's shareholders approved a forward split
agreement, whereby the outstanding common shares were exchanged at a
rate of 1.6667 shares for every 1 share outstanding. This increased
the outstanding shares to 2,500,000 immediately prior to the
reorganization agreement.
On July 31, 2000 management approved a 1 for 10 reverse split of its
outstanding common stock. All references to shares outstanding and
losses per share have been retroactively restated.
b. Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting. The Company has selected a December 31 year
end.
c. Basic Loss Per Common Share
Basic loss per common share has been calculated based on the weighted
average number of shares of common stock outstanding during the
period.
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Notes the Financial Statements
December 31, 2000 and 1999
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
d. Provision for Taxes
At December 31, 2000, the Company had net operating loss
carryforwards of approximately $250,000 that may be offset against
future taxable income through 2020. No tax benefits has been
reported in the financial statements, because the potential tax
benefits of the net operating loss carry forwards are offset by a
valuation allowance of the same amount.
The income tax benefit differs from the amount computed at federal
statutory rates of approximately 38% as follows:
For the Years Ended
December 31,
2000 1999
Income tax benefit at statutory rate $ 77,819 $ 2,299
Change in valuation allowance (77,819) (2,299)
$ - $ -
Deferred tax assets (liabilities) are comprised of the following:
For the Years Ended
December 31,
2000 1999
Income tax benefit at statutory rate $ 95,943 $ 18,124
Change in valuation allowance (95,943) (18,124)
$ - $ -
Due to the change in ownership provisions of the Tax Reform Act of
1986, net operating loss carryforwards for Federal income tax
reporting purposes are subject to annual limitations. Should a
change in ownership occur, net operating loss carryforwards may be
limited as to use in the future.
d. Cash Equivalents
The Company considers all highly liquid investments with a maturity
of three months or less when purchased to be cash equivalents.
e. Cash Equivalents
The Company considers all highly liquid investments with a maturity
of three months or less when purchased to be cash equivalents.
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Notes the Financial Statements
December 31, 2000 and 1999
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
f. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of
revenues and expenses during the reported period. Actual results
could differ from those estimates.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of liabilities
in the normal course of business. However, the Company does not have
significant cash or other material assets, nor does it have an
established source of revenues sufficient to cover its operating
costs and to allow it to continue as a going concern. It is the
intent of the Company to seek a merger with an existing, operating
company.
NOTE 3 - MATERIAL EVENTS
Effective July 19, 2000, pursuant to a Securities Purchase Agreement
(the Benchmark Agreement) with Benchmark Merchant Partners, LC
("Benchmark"), Bethurum Laboratories, Inc., a Utah corporation
("Bethurum"), offered and sold an aggregate of 2,950,000 shares of
its "restricted securities" (common stock) for an aggregate of
$312,500, $100,000 of which was represented by a promissory note.
1,250,000 of these shares were sold at $0.01 per share to persons who
had assisted Bethurum since the recommencement of its development
stage approximately three years ago (the "Consulting Group"); and
1,700,000 of these shares were issued at $0.12 per share to
Benchmark, an entity believed by Bethurum's management to be capable
of assisting Bethurum in acquiring businesses engaged in the
industries encompassed by its new Business Plan.
Substantially all of the funds ($312,500), net of offering expenses,
will be expended for payment of services and outstanding liabilities,
past and present, and current legal and accounting expenses of
Bethurum.
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Notes the Financial Statements
December 31, 2000 and 1999
NOTE 3 - MATERIAL EVENTS (Continued)
In addition, the Benchmark Agreement provided that: (i) all 1,700,000
shares issued to Benchmark would be pledged to secure payment of the
$100,000 promissory note of Benchmark that was executed and delivered
to Bethurum as partial payment of the purchase price of the 1,700,000
shares, and which promissory note is due and payable on the earlier
of the completion of an Agreement and plan of Reorganization (the
"Acquisition Agreement") with a wireless telecommunications network
company serving developing foreign markets with strong growth
potential and limited competition that has annual revenues of no less
than $50,000,000 USD, earnings before interest, taxes, depreciation
and amortization of no less than $12,500,000 USD and stockholders'
equity of not less than $10,000,000 USD *the "Suitable Reorganization
Candidate"); (ii) if the Acquisition Agreement is not completed by
December 31, 2000, the 1,700,000 shares issued to benchmark shall be
canceled to Bethurum's treasury, the promissory note will be canceled
and Bethurum will pay Benchmark the sum of $75,000, retaining the
$125,000 balance of the purchase price of the 1,700,000 shares as
liquidated damages; (iii) all 2,950,000 shares issued were accorded
"registration rights" providing for the filing of a registration
statement covering such securities and all securities heretofore
issued by Bethurum during any period when it may have been deemed to
have been a "shell" company within 45 days of the completion of the
Acquisition Agreement.
As of December 31, 2000, the promissory note with Benchmark was not
received. The 1,700,000 shares issued to Benchmark were still
outstanding. A total amount of $240,000 was retained by the Company,
which represents $200,000 paid through stock issuance and $40,000
used to cover legal expenses and costs.
The Company is still in negotiations with Benchmark to finalize the
agreement.
EXHIBIT C-1
BETHURUM LABORATORIES, LTD.
UNAUDITED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED
SEPTEMBER 30, 2001
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
September 30, 2001 and December 31, 2000
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Balance Sheets
ASSETS
September 30, December 31,
2001 2000
(Unaudited)
CURRENT ASSETS
Cash $ - $ -
----------- -----------
Total Current Assets - -
----------- -----------
TOTAL ASSETS $ - $ -
=========== ===========
LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 19,077 $ 3,007
----------- -----------
Total Liabilities 19,077 3,007
----------- -----------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock; authorized 100,000,000 common
shares at $0.001 par value; 3,300,750 shares
issued and outstanding 3,301 3,301
Additional paid-in capital 347,089 346,174
Subscription receivable (100,000) (100,000)
Deficit accumulated during development stage (269,467) (252,482)
----------- ----------
Total Stockholders' Equity (Deficit) (19,077) (3,007)
----------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ - $ -
=========== ==========
The accompanying notes are an integral part of these financial statements.
2
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
From
Inception on
For the For the October 9,
Nine Months Ended Three Months Ended 1968 Through
September 30, September 30, September 30,
2001 2000 2001 2000 2001
REVENUES $ - $ - $ - $ - $ -
--------- --------- -------- --------- ----------
EXPENSES
General and administrative 16,985 218,941 1,426 213,485 305,712
--------- --------- -------- --------- ----------
Total Expenses 16,985 218,941 1,426 213,485 305,712
--------- --------- -------- --------- ----------
LOSS FROM OPERATIONS (16,985) (218,941) (1,426) (213,485) (305,712)
--------- --------- -------- --------- ----------
OTHER (EXPENSE) INCOME
Other income - - - - 40,000
Interest expense - - - - (3,755)
--------- --------- -------- --------- ----------
Total Other (Expense)
Income - - - - 36,245
--------- --------- -------- --------- ----------
NET LOSS $ (16,985)$(218,941)$ (1,426)$(213,485)$ (269,467)
========= ========= ======== ========= ==========
BASIC AND DILUTED LOSS PER
SHARE $ (0.00)$ (0.23)$ (0.00)$ (0.12)
========= ========= ======== =========
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 3,300,750 964,800 3,300,750 1,825,750
========= ========= ========= =========
The accompanying notes are an integral part of these financial statements
3
BETHURUM LABORATORIES, INC.
(A Development Company)
Statements of Stockholders' Equity (Deficit)
From Inception on April 22, 1983 to September 30, 2001
Deficit
Accumulated
Additional Stock During the
Common Stock Paid-in Subscription Development
Shares Amount Capital Receivable Stage
Balance on inception - $ - $ - $ - $ -
Issuance of common
stock for cash at
inception at
approximately $.05
per share 30,000 30 1,470 - -
Issuance of common
stock for cash at
$0.06 per share 250,000 250 14,750 - -
Common stock issued
during
reorganization
agreement 1,000,000 1,000 (1,000) - -
Cancellation of
common stock
from divestiture
agreement (975,000) (975) 975 - -
Net loss from
inception on
April 22, 1983
through
December 31, 1986 - - - - (18,049)
Balance,
December 31, 1986 305,000 305 16,195 - (18,049)
Net loss for
the year ended
December 31, 1987 - - - - (124)
Balance,
December 31, 1987 305,000 305 16,195 - (18,173)
Net loss for
the year ended
December 31, 1988 - - - - (134)
Balance,
December 31, 1988 305,000 305 16,195 - (18,307)
Net loss for
the year ended
December 31, 1989 - - - - (144)
Balance,
December 31, 1989 305,000 305 16,195 - (18,451)
Net loss for
the year ended
December 31, 1990 - - - - (156)
Balance,
December 31, 1990 305,000 $ 305 $ 16,195 $ - $ (18,607)
The accompanying notes are an integral part of these financial statements.
4
BETHURUM LABORATORIES, INC.
(A Development Company)
Statements of Stockholders' Equity (Deficit)
From Inception on April 22, 1983 to September 30, 2001
Deficit
Accumulated
Additional Stock During the
Common Stock Paid-in Subscription Development
Shares Amount Capital Receivable Stage
Balance, December 31,
1990 305,000 305 16,195 - $ (18,607)
Net loss for
the year ended
December 31, 1991 - - - - (169)
Balance,
December 31, 1991 305,000 305 16,195 - (18,776)
Net loss for
the year ended
December 31, 1992 - - - - (182)
Balance,
December 31, 1992 305,000 305 16,195 - (18,958)
Net loss for
the year ended
December 31, 1993 - - - - (196)
Balance,
December 31, 1993 305,000 305 16,195 - (19,154)
Net loss for
the year ended
December 31, 1994 - - - - (213)
Balance,
December 31, 1994 305,000 305 16,195 - (19,367)
Net loss for
the year ended
December 31, 1995 - - - - (229)
Balance,
December 31, 1995 305,000 305 16,195 - (19,596)
Expenses paid
on the Company's
behalf - - 473 - -
Net loss for
the year ended
December 31, 1996 - - - - (6,385)
Balance,
December 31, 1996 305,000 305 16,668 - (25,981)
Expenses paid on
the Company's
behalf - - 3,167 - -
Net loss for
the year ended
December 31, 1997 - - - - (422)
Balance,
December 31, 1997 305,000 $ 305 $ 19,835 $ - $ (26,403)
The accompanying notes are an integral part of these financial statements.
5
BETHURUM LABORATORIES, INC.
(A Development Company)
Statements of Stockholders' Equity (Deficit)
From Inception on April 22, 1983 to September 30, 2001
Deficit
Accumulated
Additional Stock During the
Common Stock Paid-in Subscription Development
Shares Amount Capital Receivable Stage
Balance, December 31,
1997 305,000 $ 305 $19,835 $ - $ (26,403)
Expenses paid on
the Company's
behalf - - 1,218 - -
Common stock issued
for services at
$0.10 per share 45,750 46 4,529 - -
Net loss for
the year ended
December 31, 1998 - - - - (15,241)
Balance,
December 31, 1998 350,750 351 25,582 - (41,644)
Expenses paid
on the Company's
behalf - - 5,754 - -
Net loss for
the year
ended December
31, 1999 - - - - (6,051)
Balance,
December 31, 1999 350,750 $ 351 $ 31,336 $ - $ (47,695)
Expenses paid on
Company's behalf - - 5,288 - -
Common stock issued for
cash at $0.01 per
share 1,250,000 1,250 11,250 - -
Common stock issued
for cash at $0.12 per
share 1,700,000 1,700 298,300 (100,000) -
Net loss for the year
ended December 31,
2000 - - - - (204,787)
Balance, December 31,
2000 3,300,750 $ 3,301 $ 346,174 $(100,000) $(252,482)
Expenses paid on
Company's behalf
(unaudited) - - 915 - -
Net loss for the nine
months ended September 30,
2001 (unaudited) - - - - (16,985)
Balance, September 30,
2001 (unaudited) 3,300,750 $ 3,301 $ 347,089 $(100,000) $(269,467)
The accompanying notes are an integral part of these financial statements.
6
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
From
Inception on
April 22,
For the Nine Months Ended 1983 Through
September 30, September 30,
2001 2000 2001
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (16,985) $(218,941) $ (269,467)
Adjustments to reconcile net loss to
net cash (used) by operating activities:
Common stock issued for services - - 4,575
Changes in operating assets and
liabilities:
Increase (decrease) in accounts payable 16,070 1,153 19,077
--------- --------- -----------
Net Cash (Used) by Operating
Activities (915) (217,788) (245,815)
CASH FLOWS FROM INVESTING ACTIVITIES - - -
--------- --------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of common stock - 212,500 229,000
Additional paid-in capital 915 5,288 16,815
---------- --------- ----------
Net Cash Provided by Financing
Activities 915 217,788 245,815
---------- --------- ----------
NET INCREASE IN CASH - - -
CASH AT BEGINNING OF PERIOD - - -
---------- --------- ----------
CASH AT END OF PERIOD $ - $ - $ -
========== ========= ==========
CASH PAID FOR:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
SCHEDULE OF NON-CASH FINANCING
ACTIVITIES:
Common stock issued for services $ - $ - $ 4,575
The accompanying notes are an integral part of these financial statements.
7
BETHURUM LABORATORIES, INC.
(A Development Stage Company)
Notes the Financial Statements
September 30, 2001 and December 31, 2000
NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION
The accompanying unaudited condensed consolidated financial
statements have been prepared by the Company pursuant to the rules
and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted in accordance with such
rules and regulations. The information furnished in the interim
condensed consolidated financial statements include normal recurring
adjustments and reflects all adjustments, which, in the opinion of
management, are necessary for a fair presentation of such financial
statements. Although management believes the disclosures and
information presented are adequate to make the information not
misleading, it is suggested that these interim condensed consolidated
financial statements be read in conjunction with the Company's most
recent audited financial statements and notes thereto included in its
December 31, 2000 Annual Report on Form 10-KSB. Operating results
for the nine months ended September 30, 2001 are not necessarily
indicative of the results that may be expected for the year ending
December 31, 2001.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of liabilities
in the normal course of business. However, the Company does not have
significant cash or other material assets, nor does it have an
established source of revenues sufficient to cover its operating
costs and to allow it to continue as a going concern. It is the
intent of the Company to seek a merger with an existing, operating
company.
8
EXHIBIT D
None, except Exhibits B and B-1, as outlined in Section 1.9.
EXHIBIT E
GLOBAL STARLINK GROUP, INC. AND
COAST DRAPERY SERVICE, INC.
UNAUDITED BALANCE SHEET AND INCOME STATEMENT
FOR THE YEAR ENDED
MARCH 31, 2001
Richard C. Hanseen, CPA (letterhead)
To The Board of Directors
COAST DRAPERY SERVICE, INC.
Las Vegas, NV
I have compiled the accompanying balance sheet of COAST DRAPERY SERVICE, INC.
as of March 31, 2001, and the related statement of income for the one year
then ended, in accordance with Statements on Standards for Accounting and
Review Services issued by the American Institute of Certified Public
Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. I have not audited or
reviewed the accompanying financial statements and accordingly, do not express
an opinion or any other form of assurance on them.
Management has elected to omit substantially all of the disclosures and the
statement of cash flows required by generally accepted accounting principles.
If the omitted disclosures were included in the financial statements, they
might influence the user's conclusions about the Company's financial position,
results of operations, and cash flows. Accordingly, these financial
statements are not designed for those who are not informed about such matters.
/s/Richard C. Hanseen
Richard C. Hanseen
May 15, 2001
COAST DRAPERY SERVICE, INC.
BALANCE SHEET
March 31, 2001
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 337,059
Accounts Receivable $1,144,657
Less: Allowance for bad debts (17,170)
----------
1,127,487
Employee Advances 8,200
Interco-Sobel-Westex 1,268,465
Inventory 449,216
----------
Total current assets 3,180,427
FIXED ASSETS
Equipment 82,957
Vehicles 103,422
Leasehold improvements 6,931
----------
193,310
Accumulated depreciation (85,843)
----------
Total fixed assets 107,467
OTHER ASSETS
Cash surrender value 33,064
Prepaid expenses 11,444
----------
Total other assets 44,508
----------
Total assets $3,332,402
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Customer deposits $393,734
Accounts payable 227,423
Accrued workers compensation 733
Accrued Union fees 163
Accrued vacation 10,384
Sales tax payable 32,318
Accrued bonus 75,000
Accrued federal income tax 348,655
--------
Total current liabilities $1,088,409
STOCKHOLDERS' EQUITY
Common stock $ 53,145
Retained Earnings 1,595,141
Current net income(loss) 595,707
---------
Total stockholders' equity 2,243,993
----------
Total liabilities and stockholders' equity $3,332,402
==========
See accountant's compilation report.
COAST DRAPERY SERVICE, INC.
INCOME STATEMENT
March 31, 2001
Current Month One Year
March 31, 2001 March 31, 2001
INCOME
Sales-Wholesale $ 22,787 $ 1,894,341
Sales-Retail 451,751 5,047,127
--------- -----------
Total Sales $ 474,538 $ 6,941,468
ADJUSTMENTS
Miscellaneous income (24,725) (22,631)
Bad Debts 148 (10,998)
--------- -----------
Total adjustments (24,725) (33,629)
--------- -----------
Net Income 449,961 6,907,839
--------- -----------
COST OF SALES
Outside labor 9,000 99,542
Subcontractors 121,647 2,296,533
Supplies 235,818 2,019,529
Commissions 0 23,327
Reimbursed expenses 1,397 8,143
Freight 6,041 113,830
-------- -----------
Total cost of sales 373,903 4,560,904
-------- -----------
Gross Profit $ 76,058 $ 2,346,935
OPERATING EXPENSES 85,000 1,360,883
-------- -----------
Net income (loss) from operations (8,942) 986,052
-------- -----------
OTHER (INCOME) AND EXPENSES
Interest income (1,049) (20,275)
Fines and penalties 510 510
Officers life insurance 1,138 8,850
Bonus expense (44,751) 75,000
Gain/loss on sale of asset 0 2,933
Other income 0 (2,416)
-------- -----------
Total other (income) expense (44,152) 64,602
-------- -----------
NET INCOME (LOSS) BEFORE TAXES 35,210 921,450
-------- -----------
PROVISION FOR INCOME TAXES
Federal income tax 29,054 325,743
-------- -----------
Net income (loss) $ 64,264 $ 595,707
======== ===========
See accountant's compilation report.
To The Board of Directors
COAST DRAPERY SERVICE, INC.
Las Vegas, Nevada
My report on my compilation of the accompanying balance sheet of COAST DRAPERY
SERVICE, INC. as of March 31, 2001, and the related statement of income for
the one year then ended, appears on page 2. The information on page S-2 of
this report is presented only for purposes of additional analysis and has been
compiled by me in accordance with the Statement on Standards for Accounting
and Review Services issued by the American Institute of Certified Public
Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. I have not audited or
reviewed such information and accordingly, do not express an opinion or any
other form of assurance on them.
/s/Richard C. Hanseen
May 15, 2001
COAST DRAPERY SERVICE, INC.
OPERATING EXPENSES
March 31, 2001
Current Month One Year
March 31, 2001 March 31, 2001
OPERATING EXPENSES
Auto and truck $ 2,919 $ 40,222
Bank fees 54 80
Contributions 0 1,710
Depreciation expense 1,621 13,909
Director fees (5,000) 197,511
Dues and subscriptions 0 354
Equipment rental 2,088 17,405
Leased employees 12,398 178,257
Salaries and wages 41,334 477,255
Payroll taxes 5,227 68,251
Insurance 6,548 61,964
Interest expense 0 1,462
Licenses and permits 25 6,739
Legal and accounting 4,477 41,414
Miscellaneous expenses 1,706 3,752
Office Expense 1,115 5,864
Payroll Service fees 323 4,087
Postage 0 699
Property Taxes 0 280
Rent 8,911 94,575
Repairs and maintenance 0 8,796
Supplies 0 4,928
Telephone expense 543 9,744
Travel 0 45,888
Utilities 548 5,559
Union fees 163 70,178
------- ----------
Total operating expenses $85,000 $1,360,883
======= ==========
The accountant's supplemental compilation report should be read in connection
with this supplemental schedule.
S-2
EXHIBIT F
None.
EXHIBIT G
American Registrar & Transfer Co.
342 East 900 South
Salt Lake City, Utah 84111
Bethurum Laboratories, Ltd.
6371 Richmond, #200
Houston, Texas 77057
Re: Exchange of shares of Global Starlink Group, Inc., a
corporation organized under the laws of the Cayman
Islands, BWI ("GSL"), for shares of Bethurum
Laboratories, Ltd., a corporation organized under the
laws of the British Virgin Islands ("Bethurum" or the
"Company")
Dear Ladies and Gentlemen:
Pursuant to that certain Agreement and Plan of Reorganization (the
"Agreement") between the undersigned, GSL and Bethurum, as the duly
authorized representative of the undersigned, I acknowledge that I have
approved this exchange; that I am aware of all of the terms and conditions of
the Agreement; and I represent and warrant that (i) I am an "accredited
investor" or, either alone or with the aid of a "purchaser representative" am
a "sophisticated investor"; (ii) I understand the "unregistered" and
"restricted" nature of the shares or options of Bethurum being received under
the Agreement in exchange for the GSL Shares; (iii) I have received and
reviewed a copy of any and all material documents regarding the Company,
including, but not limited to the Company's 10-KSB Annual Report for the year
ended December 31, 2000; and its 10-QSB Quarterly Reports for the quarters
ended March 30, 2001, June 30, 2001, and September 30, 2001; (iv) I hereby
waive and compromise any pre-emptive rights relating to the prior issuance of
shares of any of the GSL Shares; and (v) I hereby compromise and/or waive any
claims I have or may have against GSL by reason of the purchase of any
securities of GSL prior to the Closing of the Agreement.
I understand that you have and will make books and records of your
Company available to me for my inspection in connection with the contemplated
exchange of my shares, and that I have been encouraged to review the
information and ask any questions I may have concerning the information of any
director or officer of the Company or of the legal and accounting firms for
the Company. I understand that the accounting firm for Bethurum is H J &
Associates, 50 South Main Street, #1450, Salt Lake City, Utah 84144, Telephone
(801) 328-4408; and that legal counsel for Bethurum is Leonard W. Burningham,
Esq., 455 East 5th South, Suite 205, Salt Lake City, Utah 84111, Telephone
#801-363-7411.
I also understand that I must bear the economic risk of ownership
of any of the Bethurum shares for a long period of time, the minimum of which
will be one (1) year, as these shares are "unregistered" shares and may not be
sold unless any subsequent offer or sale is registered with the United States
Securities and Exchange Commission or otherwise exempt from the registration
requirements of the Securities Act of 1933, as amended (the "Act"), or other
applicable laws, rules and regulations.
I intend that you rely on all of my representations made herein
and those in the personal questionnaire (if applicable) I provided to GSL for
use by Bethurum as they are made to induce you to issue me the shares of
Bethurum under the Agreement, and I further represent (of my personal
knowledge or by virtue of my reliance on one or more personal
representatives), and agree as follows, to-wit:
1. That the shares being acquired are being received for
investment purposes and not with a view toward further distribution;
2. That I have a full and complete understanding of the phrase
"for investment purposes and not with a view toward further distribution";
3. That I understand the meaning of "unregistered shares" and
know that they are not freely tradeable;
4. That any stock certificate issued by you to me in connection
with the shares being acquired shall be imprinted with a legend restricting
the sale, assignment, hypothecation or other disposition unless it can be made
in accordance with applicable laws, rules and regulations;
5. I agree that the stock transfer records of your Company
shall reflect that I have requested the Company not to effect any transfer of
any stock certificate representing any of the shares being acquired unless I
shall first have obtained an opinion of legal counsel to the effect that the
shares may be sold in accordance with applicable laws, rules and regulations,
and I understand that any opinion must be from legal counsel satisfactory to
the Company and, regardless of any opinion, I understand that the exemption
covered by any opinion must in fact be applicable to the shares;
6. That I shall not sell, offer to sell, transfer, assign,
hypothecate or make any other disposition of any interest in the shares being
acquired except as may be pursuant to any applicable laws, rules and
regulations;
7. I fully understand that my shares which are being exchanged
for shares of the Company are "risk capital," and I am fully capable of
bearing the economic risks attendant to this investment, without
qualification; and
8. I also understand that without approval of counsel for
Bethurum, all shares of Bethurum to be issued and delivered to me in exchange
for my shares of GSL shall be represented by one stock certificate only and
which such stock certificate shall be imprinted with the following legend or a
reasonable facsimile thereof on the front and reverse sides thereof:
The shares of stock represented by this certificate
have not been registered under the Securities Act of
1933, as amended, and may not be sold or otherwise
transferred unless compliance with the registration
provisions of such Act has been made or unless
availability of an exemption from such registration
provisions has been established, or unless sold
pursuant to Rule 144 under the Act.
Any request for more than one stock certificate must be
accompanied by a letter signed by the requesting stockholder setting forth all
relevant facts relating to the request. Bethurum will attempt to accommodate
any stockholders' request where Bethurum views the request is made for valid
business or personal reasons so long as in the sole discretion of Bethurum,
the granting of the request will not facilitate a "public" distribution of
unregistered shares of common voting stock of Bethurum.
You are requested and instructed to issue a stock certificate as
follows, to-wit:
________________________________________________________
(Name(s) and Number of Shares)
________________________________________________________
(Address)
________________________________________________________
(City, State and Zip Code)
Dated this 21 day of December, 2001.
Very truly yours,
ALLSTATE DEVELOPMENT LTD.
By/s/Mai Wong
Its Chairman
EXHIBIT H
CERTIFICATE OF OFFICER PURSUANT TO
AGREEMENT AND PLAN OF REORGANIZATION
The undersigned, the President of Bethurum Laboratories, Ltd., a
corporation organized under the laws of the British Virgin Islands
("Bethurum"), represents and warrants the following as required by the
Agreement and Plan of Reorganization (the "Agreement") between Bethurum and
Global Starlink Group, Inc., a corporation organized under the laws of the
Cayman Islands, BWI ("GSL"), and the sole stockholder of GSL (the "GSL
Stockholder"):
1. That he is the President of Bethurum and has been authorized
and empowered by its Board of Directors to execute and deliver this
Certificate to GSL and the GSL Stockholder.
2. Based on his personal knowledge, information, belief and
opinions of counsel for Bethurum regarding the Agreement:
(i) All representations and warranties of Bethurum
contained within the Agreement are true and correct;
(ii) Bethurum has complied with all terms and provisions
required of it pursuant to the Agreement; and
(iii) There have been no material adverse changes in the
financial position of Bethurum as set forth in its
financial statements for the years ended December 31,
2000 and 1999, and for the period ended September 30,
2001, except as set forth in Exhibit C to the
Agreement.
BETHURUM LABORATORIES, LTD.
Date: 12/20/01 By/S/William A. Silvey, Jr.
William A. Silvey, Jr., President
EXHIBIT I
CERTIFICATE OF OFFICER PURSUANT TO
AGREEMENT AND PLAN OF REORGANIZATION
The undersigned, the Chairman of Global Starlink Group, Inc., a
corporation organized under the laws of the Cayman Islands, BWI ("GSL"),
represents and warrants the following as required by the Agreement and Plan of
Reorganization (the "Agreement") between GSL, the sole stockholder of GSL (the
"GSL Stockholder") and Bethurum Laboratories, Ltd., a corporation organized
under the laws of the British Virgin Islands ("Bethurum"):
1. That he is the CEO of GSL and has been authorized and
empowered by its Board of Directors to execute and deliver this Certificate to
Bethurum.
2. Based on his personal knowledge, information, belief:
(i) All representations and warranties of GSL contained
within the Agreement are true and correct;
(ii) GSL has complied with all terms and provisions
required of it pursuant to the Agreement; and
(iii) There have been no material adverse changes in the
financial position of GSL as set forth in its
unaudited balance sheet and income statement for the
period ended March 31, 2001, except as set forth in
Exhibit E to the Agreement.
GLOBAL STARLINK GROUP, INC.
Date: 12/21/2001 By/S/Mai Wong
Mai Wong, Chairman