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Microcap & Penny Stocks : Tokyo Joe's Cafe / Societe Anonyme/No Pennies -- Ignore unavailable to you. Want to Upgrade?

To: Silicon Trader who wrote (51416)	2/3/1999 2:33:00 PM
From: Sir Auric Goldfinger	Read Replies (1) \| Respond to of 119973

Did you hear the rumor that the SEC may halt the stock? Did you see that the FBI raided their Beverly Hills office? Didn't think so... ) On August 19, 1997, a search warrant was served at the Beverly Hills, California corporate offices of the Company and its subsidiary, JBOC, pursuant to a request made by the Federal Bureau of Investigation. The Company and certain of its officers and employees were also served with Grand Jury subpoenas. The search warrant and subpoenas were issued in connection with an investigation being conducted by the U.S. Attorney's Office in Los Angeles. A focus of the investigation appears to be the prior relationship and activities of Irving Kott and Oeri Finance, Inc. with the Company and possible market manipulation. The Company cannot, however, say with any certainty that these are the only issues involved in the investigation. Mr. Kott is an individual who had been retained through an entity named Turret Consultants as a consultant to the Company. In connection with this investigation, the Swiss branch office of JBOC as well as the offices of Oeri Finance, Inc. were searched by French and Swiss authorities pursuant to a request made by the U.S. Justice Department. Felix A. Oeri, the former Chairman of the Board of Directors of the Company, serves as President of Oeri Finance, Inc. On or about the same date, the Company, its directors, JBOC and certain of its officers and employees were served with subpoenas duces tecum issued by the SEC in connection with an investigation conducted by that agency entitled In the matter of Reynolds Kendrick Stratton, Inc. The subpoenas generally call for the production of documents relating apparently to the same issues which are the subject of the Grand Jury investigation. The Company has retained counsel in the above matters and has cooperated with the U.S. Attorney's Office and the SEC in their on-going investigations. Pursuant to the subpoenas served by the U.S. Attorney's Office and the SEC, the Company has and is continuing to produce various documents responsive to such subpoenas. At this stage of both investigations, it is not possible to predict their ultimate outcome or the financial impact on the Company, if any. In September of 1997, the Company ended its consulting relationship with Turret Consultants and Mr. Kott. Under an existing Directors' and Officers' liability insurance policy held by the Company, a claim was filed with the insurer for the reimbursement of legal fees incurred in connection with the federal investigations. The policy calls for a maximum reimbursement to the Company of $2 million. The insurance company preliminarily denied the Company's claim under their interpretation of the terms of the policy. The Company believes that the insurance company has improperly denied the Company's claim and has filed an action alleging breach of contract. The Company believes that it currently can fund the ongoing legal costs associated with the investigations regardless of the outcome of the Company's claim.