The Vancouver Sun
June 21, 2000, Wednesday, FINAL
Action Poker promoters pull out stops for 'Net game: Five Playboy bunnies demonstrate company's marquee game to potential investors in Vancouver.
David Baines, Sun Business Reporter
BODY: The old Howe Street, Murray-Pezim days of stocks and blondes were revived Tuesday by two long-time Vancouver promoters trying to introduce their public company to the new millennium, or at least to a few potential investors.
Jacob Kalpakian and his uncle, Bedo Kalpakian held a reception at the Four Seasons Hotel to unveil their made-over junior exploration company, Las Vegas From Home.com Entertainment Inc., to the Vancouver investment community.
Dozens of brokers, prospective investors and just plain gawkers streamed through the Pavilion Room to watch five Playboy bunnies demonstrate the company's marquee game, Action Poker, and sign eight- by-ten glossy, deep-cleavage photos of themselves.
At the same time, six winsome hostesses handed out promotional brochures, and the Kalpakians plied the attendees with booze and regaled reporters with plans to create the ESPN of gaming companies on the Internet.
We are the only publicly- traded multi-player poker-software provider in the world, trumpeted Jacob, leaving the interviewer to ponder the financial ramifications, if any.
Asked whether the event is a throw-back to the old days, when promoters behaved more like carnies, Jacob assumed an introspective pose:
Did Howe Street really change? Isn't this business the same all the time? You have to build a business and you need to promote it. Nobody will buy shares unless you promote it.
Jacob Kalpakian has been successfully promoting Vancouver junior stocks for nine years and Bedo for 16, but they haven't built any successful businesses.
Las Vegas from Home.Com is an example. It started in the mid-1980s as an exploration company named Armeno Resources Ltd. (The Kalpakian family is originally from Armenia).
In subsequent years, the company went through several name changes and countless business ventures, including an American Express affinity card for Armenians.
By the end of last year, it had raised and lost $6.7 million of shareholders' money, including a $25,000 donation to the Canadian embassy in Armenia.
Meanwhile, another Kalpakian company, AG Armeno Mines & Minerals Inc., raised and lost $20 million of shareholders' money, much of it through a hugely-unprofitable silver mine in Ecuador.
Financial statements show the losses were exacerbated by heavy expenditures on stock promotion, most notably by hiring a string of stock touts. They included Ron Irwin Productions of Burbank, Calif.; Nastek Marketing Group of Delaware; Corporate Relations Group Inc., of Florida; Strategic Relations Group, also of Florida; S.A. Advisory of Salt Lake City; BHF Corporate Relations; Financial News Network; WMP Enterprises Inc.; and, James O. Gray of North Vancouver.
However, the promotional effort waned in the face of mounting losses and the company -- now called Golden Nugget Exploration Inc. -- has joined the long list of nearly dormant exploration companies on the CDNX. Even after a 1- for-15 share consolidation, the stock is trading at only 54 cents.
Another Kalpakian company, Trans Atlantic Enterprises Inc, similarly faded into oblivion.
Asked whether any of their public companies have ever made a profit, Bedo said AG Armeno was profitable in 1997.
However, a check of the financial statements show it actually suffered an operating loss that year. It managed to show a profit only after it defaulted on a $3.2 million loan and the lender agreed not to pursue collection. (The loan amount was added back to income, turning the loss into a profit.)
In July 1999, the Kalpakians announced Las Vegas From Home.com -- by this time a nearly-dead exploration company called Bronx Minerals Inc. -- would get into the gaming business by licensing a turnkey gaming system from Starnet Communications International Inc. of Vancouver.
However, the company abandoned that plan after RCMP raided Starnet's offices on grounds it was running an illegal gaming operation.
The company also announced it had acquired an Internet gaming licence from the Republic of Armenia. However, the company decided not to pursue it and the licence has since expired.
The company asked shareholders for permission to spend $800,000 US marketing the company's Web site during the next year and $200,000 to inform brokers and investors of . . . the merits of investing in the company's publicly-trading securities. Some of this money was apparently used to hire Jodi Ann Paterson, Playboy playmate of 2000, and four of her bunny colleagues for Tuesday's event.
The company is now developing its own gaming software through a Antiguan-based subsidiary, Endzone Inc., and plans to license it to third parties.
Jacob said the company has a test site at which people can wager play money only. In about four weeks, he said, they will be able to wager real money.
He said the company will not allow Canadian residents to wager real money because, under Canadian law, it is illegal to do so but he said it will allow American residents to play.
We're not taking bets from them. They are betting against each other, and that's legal under the current laws in the United States.
He said the company will generate revenues by taking a small rake off every hand.
The company's share price closed Monday at $1.20, up 14 cents on the day. That's nearly half its April high of $2.31.
GRAPHIC: CP Color Photo: Ward Perrin, Vancouver Sun / WEB GAME: Jacob Kalpakian (left), Bedo Kalpakian and three Playboy bunnies introduce Poker Action, a new Internet card game promoted by CDNX-listed Las Vegas From Home.com Entertainment.