BAD ASS COFFEE - FDD UFOC ITEM 4 Detail

BANKRUPTCY

Royal Aloha Bankruptcy. On April 16, 1999, Royal Aloha filed a Chapter 7 Bankruptcy Petition in the United States Bankruptcy Court for the District of Utah entitled In Re: Royal Aloha Coffee Tea and Spice Company, Inc., Case No. 99A-24191. Mr. Bilanzich was a principal officer of Royal Aloha at the time it filed for Bankruptcy. Mr. J. Kevin Bird was appointed as the Chapter 7 Bankruptcy Trustee for the estate of Royal Aloha.

On or about April 12, 2001, Mr. Bird filed several adversary proceedings against several persons including Mr. Bilanzich, as part of the administration of Royal Aloha''s bankruptcy estate. Two of those adversary proceedings concern BACH: Bird v. Bad Ass Coffee Company of Hawaii, Inc., (Adv. Proceeding No. 01P02101) (which sought to recover several payments made by Royal Aloha to BACH) and Bird v. Bilanzich, et al (Adv. Proceeding No. 01P-2105) (which sought to recover amounts for the Trademark). Mr. Bird and BACH reached an agreement to settle these claims whereby, inter alia, Mr. Bird acknowledges ownership of the Trademark and we paid a monetary amount to the trustee. This settlement agreement was approved by the Utah Bankruptcy Court on July 5, 2002.

Other than the above action, no bankruptcies are required to be disclosed in this disclosure document.