<PAGE>
Form 10-SB
U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL
BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
SPECTRUM VENTURES LTD.
(Name of Small Business Issuer in its charter)
COLORADO N/A
- -------- ---
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
402-625 Howe Street
- -------------------
Vancouver, B.C. V6C 2T6
- --------------- -------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (604) 602-6732
OTCBB
-----
Securities to be registered under Section Name of each exchange on which
12(b) of the Act: Title of each class each class is to be registered
to be so registered N/A
N/A
Securities to be registered under Section 12(g) of the Act:
Common Stock, $0.001 Par Value
------------------------------
(Title of class)
(Title of class)
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
(Registration)
Date February 23, 1999
(Signature)
By /s/ Emmanuel Aligizakis
Emmanuel Aligizakis
President
Print the name and title of each signing officer under his or her signature.
<PAGE>
SPECTRUM VENTURES LTD.
FORM 10-SB
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Item 1. Description of Business 1
Item 2. Management Discussion and Analysis or Plan of Operation 3
Item 3. Description of Property 4
Item 4. Security Ownership of Certain Beneficial Owners and Management 4
Item 5. Directors, Executive Officers, Promoters and Control Persons 4
Item 6. Executive Compensation 6
Item 7. Certain Relationships and Related Transactions 6
Item 8. Legal Proceedings 7
Item 9. Market for Common Stock and Related Stockholder Matters 7
Item 10. Recent Sales of Unregistered Securities 7
Item 11. Description of Securities 7
Item 12. Indemnification of Directors and Officers 8
Item 13. Financial Statements 8
Item 14. Changes In and Disagreements With Accountants on Accounting and
Financial Disclosure 8
Item 15. Financial Statements and Exhibits 8
</TABLE>
<PAGE>
ITEM 1 DESCRIPTION OF BUSINESS
Spectrum Ventures Ltd.(the" Company") is a development stage company formed
under the laws of the State of Colorado in March 1998. The company has not
generated any revenues from operations to date. From the date of inception, the
company has been organizing its affairs to becoming a publicly trading entity on
the NASDAQ OTCBB.
The issuer's specific business plan was to look at opportunities that had
combinations of the following;
- - cash flow (immediately or in the very short term of business plan
implementation)
- - asset acquisition and/or development due to business plan implementation
- - ability to self finance after initial injection of funding
- - exploit niche markets that would achieve a significant market share
- - have current sales or contracts in place
- - have proprietary technology, systems or knowledge that will be the
foundation for high-growth, high-margin businesses
In September of 1998, the issuer bought Rhodes Wines & Spirits Imports
Ltd.(Rhodes). The acquisition of Rhodes met the majority of the above criteria
in that the purchase price ($20,000 US) was mainly asset and inventory based;
The company would only require funding to purchase additional inventory and any
further growth and expenses would be from the sales of inventory; The
acquisition's business plans calls for the exploitation of unique packaging
formats that will expand current product lines and offer greater bottom line
margins to the company; Rhodes had current product lines already established but
was deficient in marketing funds; Definite niche markets exist that require
marketing funds for exploitation and which can be partly funded from projected
cash flows.
Rhodes is a private corporation formed under the laws of the Province of British
Columbia in 1981 and is in the business of importing and exporting wines,
spirits and specialty beers. Rhodes products are currently being supplied from
vintners in Greece, Italy and France and are being sold in British Columbia
(nine product lines) and Alberta (over fifty product lines). In Canada, products
are distributed through government registered liquor outlets. Negotiations are
also under way for product distribution into the States of Washington,
California and Florida.
In September 1998, the Company completed its initial private offering in British
Columbia selling a total of 5,307,000 common shares for total proceeds of
$114,250 US.
On September 2, 1996, the Government of Alberta announced that the Alberta
Liquor Control Board (ALCB) would close all of its retail liquor stores and
private outlets were to become the only retailers of liquor in the province.
This announcement has now been carried out and the private distribution system
is
-1-
<PAGE>
in effect. The ALCB will act as a wholesaler and will carry products requested
by the Agents. Consequently any registered agent will have to market directly to
the private liquor stores to encourage them to carry the company's products.
Agents will also be responsible for addressing quality control issues with the
retailers.
In essence, the role of the ALCB will be to house, at a cost to the agent, and
ship products demanded by the private retail distribution system. It is our
understanding that the ALCB will not in any way influence the products to be
carried by the private retailers.
The Company will list in any product, any size from any part of the world; that
is considered to be a fast consumption product. Alberta will be the base of
operations. From there it is anticipated that all products will be exposed
across Canada through Government Liquor Control Boards, and in U.S.A through
major/multinational Liquor Distributors.
It is also anticipated that Rhodes will also be the first company to introduce
into the Canadian wine market the 16L boxes/kegs coming directly from the source
(Europe). It is believed that only in this size of packaging can one achieve
unbeatable competitive advantages in pricing and profitability.
There was a time imported products could not enter Canadian Liquor Boards in
sizes larger than 1L or 1.5L bottles. Products in 16L packaging were allowed to
enter Canada on the condition that it was to be re-packaged by a local/domestic
wine producer/manufacturer.
The 16L carton-boxes and the 16L plastic liners are only manufactured in three
countries in the whole world, Canada, U.S.A. and Australia.
In Europe, the 16L packaging is a non-existing concept. Rhodes anticipates
introducing this packaging in the European market in an attempt to capture a
bigger share of their market.
Rhodes was incorporated in 1981 in the Province of British Columbia.
The Company remained largely inactive until 1986 when the owner, Mr. Dimitrios
Savvis started importing Greek wines and spirits into the British Columbia
market.
While the Company has remained small and until recently was primarily serving
the thriving Greek community, there has been steady growth. The Company now has
nine listings with the British Columbia Liquor Board (BCLB). Mr. Savvis has been
actively promoting the Company over the past eighteen months and is now in a
position to take on more products for distribution. To that end, Rhodes has
entered into representation agreements with Greek, Spanish, German and Italian
producers.
Rhodes plans to aggressively grow in the Alberta market. A starting point will
be the introduction of the products now listed in British Columbia. As these
products gain market share and as other products become available for
distribution, they will be added. These products will complement our existing
ones and will provide the Company an opportunity to appeal to a wider audience.
There are two distinct market segments that the Company intends to pursue:
. Home Consumption
. Licensed Premises
-2-
<PAGE>
The home consumption market is highly competitive, but highly fragmented as
well. According to Liquor Board statistics, wine purchases for home consumption
continues to increase, in stark contrast to other segments of the market.
The other major market is sales to licensed premises. This market is highly
fragmented. Rhodes has concentrated on the Greek community in British Columbia.
However, with the expansion of product lines, we will be concentrating our
promotional efforts in North America in many different communities.
Rhodes intends to sell its products through direct and indirect sales
organizations implementing a number of marketing programs, including direct mail
campaigns, advertising through the internet and trade publications, distributor
incentive programs in the U.S. and volume purchase agreements.
Rhodes carries six different wines, a line of beer, as well as brandy and ouzo
liquor. They are sole distributors for these products in North America.
ITEM 2 MANAGEMENT DISCUSSION and ANALYSIS or PLAN of OPERATION
The following discussion should be read in conjunction with the financial
statements and accompanying notes included elsewhere in this registration
statement.
Spectrum Ventures Ltd. (the Company) was incorporated in the State of Colorado
in March 1998 and commenced its search for viable business ventures immediately
thereafter. In September 1998, Rhodes Wines & Spirits Imports Ltd. (Rhodes) was
acquired (see attached Share Purchase Agreement).
The Company is a development stage entity with activities focused on business
planning, product research and marketing. The plan of Spectrum Ventures Ltd. is
to provide exclusive services to Rhodes to develop and expand its current client
base as well as having available resources to pursue proprietary packaging
systems to further increase the bottom line on the current product lines.
During fiscal 1998, the Company provided financial resources to Rhodes, enabling
Rhodes the opportunity to negotiate the acquisition of additional inventory as
well as place orders for the 16L packaging.
The Company was able to finance its operations for fiscal 1998 through the
issuance of 5,307,000 of its common shares for proceeds of $114,250 US. After
taking into account operating expenses and start up costs, the Company showed a
consolidated deficit of ($52,776) as at fiscal year end.
In addition to funds on hand as at December 31,1998, of $32,316, the Company has
potential revenues from existing inventory as well as receivables of $23,767.
Fixed overheads for the Company are minimal and management is of the belief
ongoing operations for the Company can be adequately maintained from current
operations. Without financial pressures of cash draining fixed expenses, growth
and expansion will be funded through internally generated cash flow from sales
of product.
-3-
<PAGE>
ITEM 3 DESCRIPTION OF PROPERTY
The Company is currently leasing 500 square feet of office space at:
402-625 Howe Street
Vancouver, British Columbia, Canada
V6C 2T6
Telephone number is (604) 602-6732
Fax number is (604) 602-6619
The lease rate is $500.00 US per month and is sufficient to carry on the day to
day activities.
The lease is month to month.
Rhodes also shares the same facilities.
ITEM 4 SECURITY OWNERSHIP OF CERTAIN BENIFICIAL OWNERS AND MANAGEMENT
The table below sets forth information, as of December 31,1998, with respect to
beneficial ownership of the Company's Common Stock by each person known by the
Company to be the beneficial owner of more than 5% of its outstanding Common
Stock, by each director of the Company, by each named Executive Officer and by
all officers and directors of the Company as a group. Unless otherwise noted,
each shareholder has sole investment and voting power over the shares owned.
<TABLE>
<CAPTION>
Name and Address Type of Number of Percent of Class
Of Beneficial Owner Ownership Shares
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Emmanuel Aligizakis Record and 2,000,000 37.7%
509 Tempe Cres Beneficial
N.Vancouver, B.C.
V7N 1E7
- ----------------------------------------------------------------------------
Officers & Directors Record and 2,424,000 45.7%
As a Group (4 persons) Beneficial
- ----------------------------------------------------------------------------
</TABLE>
ITEM 5 DIRECTORS,EXECUTIVE OFFICERS,PROMOTERS AND CONTROL PERSONS
Following are the names of the directors and officers of the Company:
Mr. Emmanuel Aligizakis, age 51,President and Director
For the past ten years, Mr. Aligizakis has been in the financial services
industry as an Account Executive assisting numerous start up ventures and small
corporations in acquiring venture capital. He has been lead underwriter on
numerous financings.
-4-
<PAGE>
Mr. Dimitrios Savvis, age 51, Director
Mr. Savvis has been the president of Rhodes Wines and Spirits Imports Ltd. for
the past sixteen years. He has his Diploma of Technology from the British
Columbia Institute of Technology.
Mr. Salvatore Palidda, age 52, Director
Mr. Palidda has been the Program Director for the Committee for Italian Language
Instructions for the past eighteen years as well as a school board trustee for
five years. He also has his Masters Degree in Modem Languages, a B.A. Honours in
Italian and a degree in teaching second languages.
Mr. Harvey Lawson, age 50, Director/Secretary
Mr. Lawson is currently an Account Executive in the financial services industry.
He is currently sitting as a director of Regeena Resources Ltd. (since 06/98) as
well as being on the board of SRR Mercantile Ltd. (since 08/98). (Both these
companies are Vancouver Stock Exchange listed).
The current Board of Directors have all been in their present capacities with
the Company since September 1998 and will be there till the next annual general
meeting or till such time that they choose to resign. All terms to the Board are
for a maximum one year period and must be renewed annually at the Company's
annual meeting.
The Company's management team is comprised of members of the Board of Directors
and is assisted at this time by independently engaged consultants in the areas
of finance, marketing and administration. It is contemplated that additional
management will be hired as the Company commences its project development
activities.
All officers and directors will be reimbursed for any expenses incurred on
behalf of the Company. Directors will be reimbursed for expenses pertaining to
attendance at meetings, including travel, lodging and meals. It is contemplated
that additional management will be hired as the Company commences its project
development activities and that any salaries paid these individuals will be
consistent with the salaries of others in similar positions in the industry.
None of the directors, officers or other members of management of the issuer
have, within the last five years, been declared bankrupt or made a voluntary
assignment in bankruptcy, made a proposal under any legislation relating to
bankruptcy or insolvency, or been subject to or instituted any proceedings,
arrangement or compromise with creditors, or had a receiver, receiver manager or
trustee appointed to hold the assets of that individual.
The following sets forth, as of the date of this Memorandum, the number and
percentage of shares of Common Stock owned of record and beneficially by persons
or firms that own more than five percent (5%) of the Company's outstanding
Common Stock:
Emmanuel Aligizakis 2,000,000 Common Shares purchased for $0.001 for proceeds
to the company of $2,000.00. If the total Offering is subscribed for in this
Offering Memorandum, Mr. Aligizakis will control 33.33% of the issued and
outstanding shares of the Corporation.
-5-
<PAGE>
ITEM 6 EXECUTIVE COMPENSATION
Particulars of compensation paid to Emmanuel Aligizakis, who acts as the Company
President, for the period from the date of incorporation (March 98) to the end
of the most recently completed financial year end December 31,1998, are set out
in the summary compensation table below:
Summary Compensation Table
--------------------------
<TABLE>
<CAPTION>
(As at year ended December 31,1998)
- --------------------------------------------------------------------------------
ANNUAL COMPENSATION Long Term
------------
Compensation
------------
Securities
Underlying
Options/
Name and Principal Salary Bonus Other SARS
Position Year $ $ Compensation Granted
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
E. Aligizakis 1998 10,000(1) 0 0 0
President
- --------------------------------------------------------------------------------
</TABLE>
(1) Mr. Aligizakis began drawing a management salary of $2,500 per month in
September of 1998 pursuant to a management agreement dated September 1,1998
with the Company.
The Company has no Long Term Incentive Plan and made no awards under any such
plan in the period from the date of incorporation to December 31,1998.
The Company has not set out any options nor any SARS from the date of
incorporation to December 31,1998.
No insiders and promoters of the Company, or any associates or affiliates of the
foregoing, have an interest in any material transactions in which the Company
has participated or intends to participate at this time, save and except that
Mr. Aligizakis receives a monthly payment of $2,500 for management fees.
Except for the management fee paid to Mr. Aligizakis, no other compensation is
proposed to be paid to any other individual or entity.
ITEM 7 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There are no reportable events under this item.
-6-
<PAGE>
ITEM 8 LEGAL PROCEEDINGS
The Officers and Directors of the Company certify that to the best of their
knowledge, neither the Company nor any of its officers and directors are parties
to any legal proceeding or litigation. Further, the officers and directors know
of no threatened or contemplated legal proceedings or litigation. None of the
Officers and Directors have been convicted of a felony or none have been
convicted of a felony or none have been convicted of any criminal offense,
felony and misdemeanor relating to securities or performance in corporate
office. To the best of the knowledge of the Officers and Directors, no
investigations of felonies, misfeasance in office or securities investigations
are either pending or threatened at the present time.
ITEM 9 MARKET FOR COMMON EQUITY and RELATED STOCKHOLDER MATTERS
There is currently no public market for the Common stock of the Company.
As of December 31,1998, there were 5,307,000 shares of Common stock outstanding,
held by 49 shareholders of record. The shares of the directors, officers and
principle shareholders totalling 2,424,000 of the Company are considered
restricted and allowed for release under Rule 144. The remaining 2,883,000
shares were issued under Regulation 504 and are considered free trading
To date the Company has not paid any dividends on its Common stock and does not
expect to declare or pay any dividends on such common stock in the foreseeable
future. Payment of any dividends will be dependent upon future earnings, if any,
the financial condition of the Company, and other factors as deemed relevant by
the Company's Board of Directors.
The Company has not granted any shares under options.
ITEM 10 RECENT SALES OF UNREGISTERED SECURITIES
Since the Company was incorporated in March 1998, there have been 5,307,000
shares of
Common Stock sold to 49 shareholders for total cash proceeds of $114,250 US. All
of these shares were sold to friends and acquaintances of the Company's Officers
and Directors in September 1998 under Rule 504 of Regulation D. No underwriting
fees or commissions were paid in connection with this offering.
ITEM 11 DESCRIPTION OF SECURITIES
The Company is authorized to issue 100,000,000 shares of Common Stock with a par
value of $0.001. The holders of the shares are entitled to vote at all meetings
of the shareholders, to receive dividends if, as and when declared by the
directors, and to participate ratably in any distribution of property or assets
on the liquidation, winding up or dissolution of the Company.
-7-
<PAGE>
Holders are entitled to one vote for each share owned. The shares have no
preemptive or
conversion rights. As of December 31,1998, 5,307,000 shares have been issued
and are outstanding.
ITEM 12 INDEMNIFICATION OF DIRECTORS AND OFFICERS
The corporation shall indemnify, to the maximum extent permitted by Colorado
law, any person who is or was a director, officer, agent, fiduciary or employee
of the corporation against any claim, liability or expense arising against or
incurred by such person made party to a proceeding because he is or was a
director, officer, agent, fiduciary or employee of the corporation or because he
is or was serving another entity or employee benefit plan as a director,
officer, partner, trustee, employee, fiduciary or agent at the corporation's
request. The corporation shall further have the authority to the maximum extent
permitted by Colorado law to purchase and maintain insurance providing such
indemnification.
Limitation on Director's Liability. No director of this corporation shall have
any personal liability for monetary damages to the corporation or its
shareholders for breach of his fiduciary duty as a director, except that this
provision shall not eliminate or limit the personal liability of a director to
the corporation or its shareholders for monetary damages for any breach, act,
omission or transaction as to which the Colorado Business Corporation Act (as in
effect from time to time) prohibits expressly the elimination or limitation of
liability. Nothing contained herein will be construed to deprive any director of
his right to all defenses ordinarily available to a director nor will anything
herein be construed to deprive any director of any right he may have for
contribution from any other director or other person.
ITEM 13 FINANCIAL STATEMENTS
ITEM 14 CHANGES IN and DISAGREEMENTS WITH ACCOUNTANTS on ACCOUNTING and
FINANCIAL DISCLOSURES
Since the Company was incorporated in March 1998, there have been no
disagreements with the accountants on any matters of accounting.
ITEM 15 FINANCIAL STATEMENTS and EXHIBITS
Independent Auditors Report of Minni, Bella & CO.
Financial Statements
Consolidated Balance Sheet
Consolidated Statement of Loss and Deficit
Consolidated Statement of Cash Flows
-8-
<PAGE>
SPECTRUM VENTURES LTD.
CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1998
(Expressed in U.S. Dollars)
AUDITORS' REPORT
CONSOLIDATED BALANCE SHEET
CONSOLIDATED STATEMENT OF LOSS AND DEFICIT
CONSOLIDATED STATEMENT OF CASH FLOWS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
<PAGE>
[LETTERHEAD OF MINNI, BELLA & CO.]
AUDITORS' REPORT
To the Directors
Spectrum Ventures Ltd.
We have audited the consolidated balance sheet of SPECTRUM VENTURES LTD. as at
December 31, 1998 and the consolidated statements of loss, deficit and cash
flows for the period from March 23, 1998 (Date of Incorporation) to December 31,
1998. These consolidated financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform an audit to obtain reasonable
assurance 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.
In our opinion, these financial statements present fairly, in all material
respects, the financial position of the Company as at December 31, 1998 and the
results of its operations and changes in cash flows for the period then ended in
accordance with generally accepted accounting principles.
MINNI, BELLA & CO.
CERTIFIED GENERAL ACCOUNTANTS
Vancouver, B.C.
January 23, 1999
<PAGE>
SPECTRUM VENTURES LTD.
CONSOLIDATED BALANCE SHEET AS AT DECEMBER 31, 1998
(Expressed in U.S. Dollars)
ASSETS
------
<TABLE>
<CAPTION>
Spectrum Rhodes Wines
Ventures & Spirits Consolidated
Ltd. Imports Ltd. Adjustments Amounts
-------- ------------ ----------- ------------
<S> <C> <C> <C> <C>
CURRENT
Cash $ 31,357 $ 959 $ - $ 32,316
Accounts receivable - 23,767 - 23,767
Loan receivable 1,000 - - 1,000
Deposits - 132 - 132
Inventory - 9,101 - 9,101
Investment in Rhodes
Wines & Spirits Imports
Ltd. (Note 3) 20,000 - (20,000) -
-------- -------- --------- --------
52,357 33,959 (20,000) 66,316
DUE BY RELATED PARTIES 22,870 - (22,649) 221
CAPITAL ASSETS (NOTE 2) - 1,860 - 1,860
-------- -------- -------- --------
$ 75,227 $ 35,819 $ (42,649) $ 68,397
========= ========= ========== =========
LIABILITIES
-----------
CURRENT
Accounts Payable $ 2,996 $ 3,927 $ - $ 6,923
DUE TO RELATED PARTIES - 143,683 (143,683) -
-------- -------- ---------- --------
2,996 147,610 (143,683) 6,923
======== ======== ========== ========
SHAREHOLDERS' EQUITY
--------------------
SHARE CAPITAL (Note 4) 114,250 1 (1) 114,250
DEFICIT (42,019) (111,792) 101,035 (52,776)
--------- --------- -------- ---------
72,231 (111,791) 101,034 61,474
-------- --------- -------- ---------
$ 75,227 $ 35,819 $ (42,649) $ 68,397
========= ========= ========== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
SPECTRUM VENTURES LTD.
CONSOLIDATED STATEMENT OF LOSS AND DEFICIT
FOR THE PERIOD MARCH 23, 1998 (DATE OF INCORPORATION) TO DECEMBER 31, 1998
(Expressed in U.S. Dollars)
<TABLE>
<CAPTION>
Spectrum Rhodes Wines
Ventures & Spirits Consolidated
Ltd. Imports Ltd. Adjustments Amount
-------- ------------ ----------- ------------
<S> <C> <C> <C> <C>
SALES $ - $ 3,869 $ 2,145 $ 1,724
COST OF SALES - 4,053 (1,398) 2,655
-------- -------- -------- --------
GROSS LOSS - (184) 747 (931)
-------- -------- -------- --------
EXPENSES
Advertising and promotion 316 2,151 (1,518) 949
Amortization - 465 (310) 155
Auto - 733 (473) 260
Bad debt - 8,533 (1,266) 7,267
Bank charges 56 619 (581) 94
Business plan 12,052 - - 12,052
Consulting fees 10,000 - - 10,000
Foreign exchange difference (68) 30 (4) (42)
Licenses and fees - 83 (83) -
Office and miscellaneous 1,044 885 (645) 1,284
Professional fees 5,845 667 (667) 5,845
Rent 10,400 410 - 10,810
Telephone 597 2,128 (1,331) 1,394
Transfer agent 1,777 - - 1,777
-------- -------- -------- --------
42,019 16,704 (6,878) 51,845
-------- -------- -------- --------
NET LOSS FOR THE PERIOD (42,019) (16,888) 6,131 (52,776)
DEFICIT, BEGINNING OF PERIOD - (94,904) 94,904 -
-------- --------- -------- --------
DEFICIT, END OF PERIOD $(42,019) $(111,792) $101,035 $(52,776)
======== ========= ======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
SPECTRUM VENTURES LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD MARCH 23, 1998 (DATE OF INCORPORATION) TO DECEMBER 31, 1998
(Expressed in U.S. Dollars)
<TABLE>
<S> <C>
OPERATING ACTIVITIES
Net loss for the period $ (52,776)
Add items not involving cash:
Amortization 155
Cash provided (used) by net
changes in non-cash
working capital items
(net of effects of acquisition
of subsidiary)
(9,313)
--------
(61,934)
--------
FINANCING ACTIVITIES
Issuance of shares 114,250
--------
INVESTING ACTIVITIES
Acquisition of subsidiary (20,000)
--------
INCREASE IN CASH 32,316
CASH, BEGINNING OF PERIOD -
--------
CASH, END OF PERIOD $ 32,316
========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
SPECTRUM VENTURES LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1998
(Expressed in U.S. Dollars)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a) Principles of Consolidation
---------------------------
These consolidated financial statements include the accounts of the
Company and its wholly owned subsidiary Rhodes Wines & Spirits
Imports Ltd.
b) Inventory
---------
Inventory is valued at the lower of cost and net realizable value.
c) Amortization
------------
Capital assets are recorded at cost. Annual rates of amortization
are as follows:
Furniture & fixture - 20% declining balance
Equipment - 20% declining balance
Vehicle - 20% declining balance
d) Foreign Currency Translation
----------------------------
Monetary assets and liabilities expressed in foreign currency are
transacted at rate of exchange in effect at the end of the period.
Revenue and expenses items are translated at the average rate for
the period. Exchange gains and losses arising from the translation
are included in the operations.
2. CAPITAL ASSETS
<TABLE>
<CAPTION>
Accumulated Unamort.
Cost Amortization Cost
---- ------------ --------
<S> <C> <C> <C>
Furniture $ 1,000 $ 590 $ 410
Office & Fixture equipment 1,667 984 683
Vehicle 1,666 899 767
-------- ---------- -------
$ 4,333 $ 2,473 $ 1,860
-------- ---------- -------
</TABLE>
<PAGE>
SPECTRUM VENTURES LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1998
(Expressed in U.S. Dollars) Page 2
3. ACQUISITION OF RHODES WINES & SPIRITS IMPORTS LTD.
By agreement dated September 1, 1998, the Company acquired 100 common
shares, representing 100% of the issued and outstanding shares, of
Rhodes Wines & Spirits Imports Ltd. for $20,000.
4. SHARE CAPITAL
a) Authorized
-----------
100,000,000 Common shares, $0.001 par value per share.
b) Issued and Paid Up
------------------
<TABLE>
<CAPTION>
Number of
Shares Amount
--------- ------
<S> <C> <C>
Issued for cash 5,307,000 $114,250
========
</TABLE>
5. RELATED PARTY TRANSACTIONS
During the period ended December 31, 1998 the Company paid $10,000 to a
director for consulting fees.
During the period ended December 31, 1998 the Company paid $1,400 to a
director for office rent and administration services.
6. INCORPORATION
The Company was incorporated on March 23, 1998 under the laws of the
State of Colorado.
<PAGE>
PART III
INDEX TO EXHIBITS
2.1 Share Purchase Agreement between Rhodes Wines & Spirits Imports Ltd. and
Spectrum Ventures Ltd.
3.1 Articles of Incorporation of Spectrum Ventures Ltd.
3.2 Bylaws of Spectrum Ventures Ltd.
4.1 Speciman Share Certificate
10.1 Consulting Agreement between Emmanuel Aligizakis and Spectrum Ventures Ltd.
27.1 Financial Data Schedule
<PAGE>
EXHIBIT 2.1
SHARE PURCHASE AGREEMENT
------------------------
THIS AGREEMENT dated as of Tuesday, September 1,1998.
BETWEEN:
Spectrum Ventures Ltd. (hereinafter "Spectrum") of 509 Tempe
-----------------------
Crescent, North Vancouver, British Columbia, V7N 1E7.
OF THE FIRST PART
AND:
The undersigned shareholders in Rhodes Wines & Spirits Imports
------------------------------
Ltd(hereinafter collectively called the "Principal"),of P.O. Box
---
27016 Collingwood, Vancouver, British Columbia, V5R 6A8
OF THE SECOND PART
AND:
Rhodes Wines & Spirits Imports Ltd.: (hereinafter"Rhodes") of Box
---------------------------------------
27016 Collingwood, Vancouver, British Columbia, V5R 6A8
OF THE THIRD PART
WHEREAS:
A. The Principal owns all of the issued and outstanding shares of Rhodes
and has agreed to sell to Spectrum and Spectrum has agreed to buy all of the
Principal's shares in Rhodes on the terms and conditions set out in this
agreement.
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of one
dollar (the receipt and sufficiency of which is hereby acknowledged) and the
mutual promises contained herein the parties agree as follows:
ARTICLE 1
Definitions
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1.1 In this Agreement, unless the context otherwise requires:
(a) "Agreement" means this agreement, its schedules and any amendment to
------------
any of them;
<PAGE>
(b) "Closing" means the closing of the purchase and sale of the Rhodes
---------
Shares on the Closing Date as provided in Article 9;
(c) "Closing Date" means the tenth business day following the day on which
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Spectrum obtains the final approval required to permit to complete
the transactions contemplated herein;
(d) "Encumbrances" means mortgages, charges, pledges, security interests,
--------------
liens, encumbrances, actions, claims, demands and equities of any
nature;
(e) "Rhodes Assets" means all of the assets of Rhodes listed in Schedule
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"1";
(f) "Rhodes Shares" means all of the issued and outstanding shares of
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Rhodes.
(g) "Purchase Price" means the purchase price for the Rhodes Shares to be
----------------
paid by Spectrum.
(h) "Regulatory Authorities" means any government agency having
------------------------
jurisdiction over the transactions contemplated in this Agreement;
ARTICLE 2
List of Schedules
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2.1 Description Schedule
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Rhodes Assets 1
Rhodes Financial Statements 2
ARTICLE 3
Purchase And Sale
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3.1 Purchased Shares. Relying upon the representations and warranties
-----------------
herein contained, and subject to the terms and conditions hereof, at the
Closing, Principal will deliver to Spectrum and Spectrum will accept and acquire
from Principal all of the issued and outstanding Rhodes Shares in exchange for
the Purchase Price.
3.2 Purchase Price. The purchase price for the Rhodes Shares is Twenty
---------------
Thousand Dollars ($20,000 US.)
3.3 Delivery of Purchase Price. The Purchase Price will be delivered upon
---------------------------
Closing.
<PAGE>
ARTICLE 4
Representations, Warranties and Covenants Of
--------------------------------------------
Rhodes and Principal
--------------------
4.1 Representations and Warranties. Rhodes and Principal represent and
-------------------------------
warrant to Spectrum that:
(a) Rhodes Wines & Spirits Imports Ltd. is provincially incorporated and
validly existing and in good standing under the laws of the Province
of British Columbia and has all necessary power to own the Rhodes
Assets, a list of which is attached hereto and to conduct its business
as such business is now being conducted;
(b) the authorized share capital of Rhodes consists of an unlimited number
of Class A common voting shares;
(c) there are no outstanding share purchase options, rights to acquire
shares or other contractual rights pursuant to which Rhodes is
obligated to issue additional Rhodes Shares;
(d) Principal owns of record and at the Closing will own all of the Rhodes
Shares and at the Closing will have the full and lawful right, and
authority to sell the Rhodes Shares to Spectrum and that upon payment
of the Purchase Price, Spectrum will own the Rhodes Shares free and
clear of all Encumbrances;
(e) the execution and delivery of this Agreement and the consummation of
the transaction contemplated hereby have been duly authorized by the
Board of Directors;
(f) no person other than Spectrum has any agreement, option, understanding
or commitment, or any right or privilege (whether by law, pre-emptive
or contractual) capable of becoming an agreement, option or commitment
for the purchase of any of the Rhodes Shares;
(g) Rhodes now owns and possesses the Rhodes Assets free and clean of all
Encumbrances and, at the Closing, Rhodes will own and possess the
Rhodes Assets free and clear of any and all encumbrances;
(h) neither Principal nor Rhodes is aware of any adverse claim or claims
which may affect title to or exclusive possession and use of the
Rhodes Assets by Rhodes;
<PAGE>
(i) neither the execution and delivery of this Agreement, nor the
completion of the purchase and sale contemplated herein will conflict
with or result in any breach of any of the terms and provisions of the
constating documents or articles of Rhodes, or any order, decree,
statute, regulation, covenant or restriction applicable to Rhodes;
(j) there are no actions, suits or proceedings, judicial or administrative
(whether or not purportedly on behalf of Rhodes) pending or threatened
by or against Rhodes or affecting any of the Rhodes Assets, at law or
in equity, or before or by any federal, provincial, state, municipal
or other government court, department, commission, board, bureau,
agency or instrumentality, domestic or foreign and neither Principal
or Rhodes is aware of any existing ground on which any such action,
suit or proceeding might be commenced with any reasonable likelihood
of success;
(k) Rhodes is not in default or breach of its obligations under any one or
more material contracts to which it is a party, and to the knowledge
of Rhodes and Principal, there exists no state of facts which, after
notice of lapse of time or both, would constitute such a default or
breach, and all such material contracts are now in good standing and
in full force and effect without amendment thereto and Rhodes is
entitled to all benefits thereunder. Neither Principal nor Rhodes is
aware of any client of Rhodes having an intention to terminate, either
by notice or breach, any material contract made with or arranged by
Rhodes;
(l) Rhodes has filed with appropriate taxation authorities, federal,
state, provincial and local, all returns, reports and declarations
which are required to be filed by it and has paid all taxes which have
become due and no taxing authority is asserting or has, to the
knowledge of Rhodes or Principal threatened to assert, or has any
basis for asserting against Rhodes any claim for additional taxes or
interest thereon or penalty;
(m) the financial statements of Rhodes attached hereto have been based on
the books and records of Rhodes fairly present the financial condition
of Rhodes at the date thereof and the results of the operations for
such period; and
(n) Rhodes has no liabilities or obligations, secured or unsecured
(whether accrued, absolute, contingent or otherwise) which are not
disclosed in the financial statements attached hereto, except for
those incurred in the ordinary course of business.
4.2 Covenants of Rhodes and Principal. Rhodes and Principal will:
----------------------------------
<PAGE>
(a) not, from the date hereof to the Closing, without the prior consent of
Spectrum enter into any contractual commitment respecting the Rhodes
Shares or enter into any transactions or incur any obligations that
could, individually or in the aggregate adversely affect the rights or
interests of Spectrum in and to the Rhodes Shares pursuant to the
terms of this Agreement;
(b) from the date hereof to the Closing Date, permit the representatives
of Spectrum to make such further investigation respecting the Rhodes
Shares and the Assets as Spectrum may consider necessary or desirable
and Rhodes will make available all information, books and records
required in this connection.
ARTICLE 5
Representations, Warranties And Covenants Of
--------------------------------------------
Spectrum
--------
5.1 Representations and Warrants. Spectrum represents and warrants to
-----------------------------
Principal and Rhodes that:
(a) Spectrum is a corporation duly incorporated and validly existing and
in good standing under the laws of Colorado;
(b) The execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by the
Board of Directors;
(c) Neither the execution and delivery of this Agreement nor consummation
of the transactions contemplated hereby will conflict with or result
in the breach of any of the terms or provisions of, or constitute a
default under, the Memorandum or Articles of Spectrum or any
indenture, mortgage or other agreement or instrument to which Spectrum
is a party of by which it is bound or any order, decree, statute,
regulation, covenant or restriction applicable to Spectrum;
(d) Spectrum has no liabilities or obligations, secured or unsecured
(whether accrued, absolute, contingent or otherwise) which are not
disclosed hereto, except for those incurred in the ordinary course of
business.
ARTICLE 6
Survival Of Representations, Warranties And Covenants
-----------------------------------------------------
6.1 Survival. The representations, warranties and covenants made by
---------
Rhodes, Principal and Spectrum in this Agreement will survive the Closing and,
notwithstanding
<PAGE>
such Closing or any investigation made by or on behalf of either Rhodes,
Principal, Spectrum or any other person acting on their behalf, will continue in
full force and effect.
ARTICLE 7
Conditions Precedent To The Obligations Of
------------------------------------------
Spectrum
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7.1 Conditions. The obligations of Spectrum to complete the transactions
-----------
provided for in this Agreement are subject to the fulfillment prior to or
concurrently with the Closing of the following conditions:
(a) The representations and warranties of Principal and Rhodes contained
hereunder will be true and accurate and not misleading in any material
respect at the time of the Closing with the same effect as if such
representations and warranties had been made at the Closing;
(b) Principal and Rhodes will have complied with or performed all of the
terms, covenants and conditions contained in this Agreement which are
to be complied with or performed by Principal and Rhodes on or before
the Closing;
(c) The transactions contemplated hereby will have been approved by all
regulatory authorities having jurisdiction including, without
limitation, the Regulatory Authorities;
(d) An officer of Rhodes will have certified to the best of his knowledge
that the representations and warranties of Rhodes hereunder are true
and accurate and not misleading in any material respect at the time of
Closing with the same effect as if such representations and warranties
had been made at the Closing;
(e) Spectrum will have received a satisfactory opinion from the legal
counsel of Rhodes as to the corporate status and affairs of Rhodes;
(f) The transactions contemplated hereby will have been approved by all
regulatory authorities having jurisdiction including, without
limitation, the Regulatory Authorities;
(g) Spectrum's employees, counsel, auditors, consultants, officers and
directors will have had free access to the premises, corporate
financial and technical records and documents of Rhodes and will have
obtained such cooperation and assistance from Principal and Rhodes as
is reasonably requested; provided that any information so obtained by
Spectrum concerning the affairs of Rhodes will be considered
confidential and will
<PAGE>
not be disclosed prior to the Closing without the prior approval of
Principal and Rhodes.
7.2 Waiver of Conditions. The conditions contained in Section 7.1 are
---------------------
inserted for the exclusive benefit of Spectrum and may be waived in whole or in
part by Spectrum at any time without prejudice to the right of Spectrum to rely
on all covenants, agreements, representations and warranties in this Agreement
and all conditions contained in Section 7.1, except to the extent so waived in
writing by Spectrum. In case any of the conditions contained in Section 7.1 are
not fulfilled or complied with as provided, Spectrum may, on or prior to the
Closing Date at its option, rescind this Agreement by notice in writing to
Principal and in such event Spectrum, Principal and Rhodes will each be released
from all obligations in this Agreement, except for any loans and loan security
agreements made between the parties.
ARTICLE 8
Conditions Precedent to The Obligations Of
------------------------------------------
Principal
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8.1 Conditions. The obligations of Principal to complete the transactions
-----------
provided for in this Agreement are subject to the fulfillment prior or
concurrently with the Closing, of the following conditions:
(a) the representations and warranties of Spectrum contained hereunder
will be true and accurate and not misleading in any material respect
at the time of the Closing with the same effect as if such
representations and warranties had been made at the Closing;
(b) Spectrum will have complied with or performed all of the terms,
covenants and conditions contained in this Agreement which are to be
completed or performed by Spectrum on or before the Closing;
(c) An officer of Spectrum, will have certified to the best of his
knowledge that the representations and warranties of Spectrum
contained hereunder are true and accurate and not misleading in any
material respect at the time of Closing with the same effect as if
such representations and warranties had been made at the Closing;
8.2 Waiver of Conditions. The conditions contained in Section 8.1 are
---------------------
inserted for the exclusive benefit of Principal and may be waived in
whole or in part by Principal at any time without prejudice to the
right of Principal to rely on all covenants, agreements,
representations and warranties in this Agreement and all conditions
contained in Section 8.1, except to the extent so waived in writing by
Principal. In case any of the conditions contained in Section 8.1 will
not be fulfilled or complied with, Principal may, on or prior to the
Closing at his option, rescind this
<PAGE>
Agreement by notice in writing to Spectrum and in such event Spectrum,
Rhodes and Principal will each be released from all obligations
hereunder, except for any loans and loan security agreements made
between the parties.
ARTICLE 9
Appointment and Authority of Manager
------------------------------------
9.1 Appointment of Manager. Principal shall be retained as Manager of
----------------------
Rhodes to administer the affairs of Rhodes in connection with the sale and
distribution of Rhodes products. The Manager, at the expense of and on behalf
of Rhodes, shall implement or cause to be implemented all decisions of the
Directors and shall conduct or cause to be conducted the ordinary and usual
business and affairs of Rhodes. The Manager shall at all times conform to the
policies and directives established and approved by the Directors. The Manager
shall at all times be subject to the direction of the Directors and shall keep
the Directors informed as to all matters concerning Rhodes.
9.2 Independent Contractor. In performing its services, the Manager
----------------------
shall be an independent contractor and NOT an employee or agent of Rhodes NOR
Spectrum except that the Manager shall be the agent of Rhodes solely to perform
the Director's obligations.
9.3 Compensation of Manager. As compensation for its management services
-----------------------
under Articles 9.1 & 9.2 the Manager will be able to draw up to $2,500 CDN ONLY
AND IF sales have been made AND there is appropriate profits from such sales to
justify any compensation.
9.4 Appointment to Board of Spectrum. Upon the signing of this agreement,
--------------------------------
Principal will be also appointed to the Board of Directors of Spectrum Ventures
Ltd.
ARTICLE 10
Closing
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10.1 Time and Place. Subject to the terms and conditions hereof, the
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transactions contemplated by Article 3 will be completed and closed at the
Closing to be held at Vancouver.
10.2 Deliveries by Principal. At the Closing, Principal or its nominee
------------------------
will deliver to Spectrum:
(a) the share certificates representing the Rhodes Shares, duly executed
for transfer in favour of Spectrum.
10.3 Received by Principal. At the Closing, Principal or its nominee will
----------------------
receive:
<PAGE>
(a) the Purchase Price in the manner set out in Article 3; and
10.4 Delivered by Rhodes and Principal. At closing, Principal and Rhodes
----------------------------------
will deliver to Spectrum:
(a) the certificate as provided in 7.1(d); and
(b) the opinion provided for in 7.1(e).
ARTICLE 11
General
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11.1 Interim Secured Loans. It is agreed that if any interim loans are
----------------------
made by Spectrum to Rhodes, such loans will be secured upon the assets of Rhodes
and Rhodes shall execute and deliver promissory notes and security agreements
for any such loans.
11.2 Transactional Expenses. It is agreed that each party to this
-----------------------
Agreement will bear their own respective costs incurred in negotiating and
preparing this Agreement, in closing and carrying out the transaction
contemplated hereunder. All costs related to satisfying any condition or
fulfilling any covenant contained in this Agreement will be borne by the party
whose responsibility it is to satisfy the provision in question. By way of
example and without limiting the foregoing, the expenses of any independent
legal advice received by Principal regarding the execution of this Agreement
shall be borne by Principal.
11.3 Further Assurances. Each of the parties hereby covenants and agrees
-------------------
that at any time and from time to time either before or after the Closing Date
it will, upon the request of the other party, do, execute, acknowledge and
deliver or cause to be done, executed, acknowledged and delivered all such
further acts, deeds, assignments, transfers, conveyances, powers of attorney and
assurances as may be required for the better carrying out and performance of all
the terms of this Agreement.
11.4 Notice. Any notice required or permitted to be given or delivery
-------
required to be made to any party may be effectively given or delivered if it is
delivered personally or by telex or telecopy:
(a) In the case of Rhodes and Principal:
P.O Box 27016 Collingwood
Vancouver, British Columbia
V5R 6A8
Attention: Dimitrios Savvis
----------
<PAGE>
(b) In the case of Spectrum:
509 Tempe Crescent
North Vancouver, British Columbia
V7N 1E7
Attention: Emmanuel Aligizakis
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or to such other address as the party entitled to or receiving such notice may
notify the other party as provided for herein.
11.5 Governing law. This Agreement will be governed by and construed in
--------------
accordance with the laws of British Columbia.
11.6 Successors and Assigns. This Agreement will be binding upon and enure
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to the benefit of the parties hereto and their respective heirs and executors
and successors and assigns as the case may be.
11.7 Entire Agreement. This Agreement constitutes the entire agreement
-----------------
between the parties and supersedes all prior letters of intent,
agreements, representations, warranties, statements, promises,
information, arrangements and understandings, whether oral or written,
express or implied.
11.8 Publicity. All news releases or other public announcements or
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disclosures to clients of the parties or others will be mutually
agreed upon and in any event will be subject to regulatory
requirements.
11.9 Amendment. No modification or amendment to this Agreement may be
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made unless agreed to by the parties thereto in writing.
11.10 Severability. In the event any provision of this Agreement will be
-------------
deemed invalid or void, in whole or in part, by any court of competent
jurisdiction, the remaining terms and provisions will remain in full force and
effect.
11.11 Headings. The headings contained herein are inserted for convenience
---------
only and will not be construed as part of the Agreement.
<PAGE>
11.12 Counterparts. This Agreement may be executed in any number of
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counterparts with the same effect as if all parties to this Agreement had signed
the same document and all counterparts will be construed together and will
constitute one and the same instrument and any facsimile signature shall be
taken as an original.
IN WITNESS WHEREOF the parties hereto have duly executed this Agreement as
of the day and year first above written.
Rhodes Wines & Spirits Imports Ltd.
/s/ Dimitrious J. Savvis
______________________________
Per: Authorized Signatory
DIMITRIOUS J. SAVVIS
______________________________
Name
Dimitrios Savvis as Principal
/s/ Dimitrious J. Savvis
______________________________
Rhodes Wines & Spirits Imports Ltd. as Principal
/s/ Dimitrious J. Savvis
______________________________
Per: Authorized Signatory
DIMITRIOUS J. SAVVIS
______________________________
Name
Spectrum Ventures Ltd.
/s/ Emmanuel Augizakis
_______________________________
Per: Authorized Signatory
EMMANUEL AUGIZAKIS
_______________________________
Name
<PAGE>
SCHEDULE "I"
The Rhodes Assets will consist of:
Patents, patents pending, trademarks, copyrights, any right to patent,
trademark or copyright in any Country, title, engineering designs,
concepts, models, prototypes, parts, manufacturing machines and tools,
trade secrets, designs, parts, test equipment for, equipment required for
use with, inventory, customer lists, advertising brochures, supplier lists
and goodwill.
<PAGE>
Rhodes Wines & Spirits Imports/Exports Int'l Ltd
The undersigned, being all the directors of Rhodes Wines & Spirits
Imports/Exports Int'l Ltd. (the "Company") hereby consent to and adopt the
following resolutions as of......................
WHEREAS the Company has negotiated an agreement (the "Purchase Agreement") for
the sale of all of the shares of the Company to Spectrum Ventures Ltd. on the
terms and conditions as set forth in the Purchase Agreement attached hereto.
AND WHEREAS the board of directors believe it would be in the best interests of
the Company to enter and complete the Purchase Agreement.
BE IT RESOLVED THAT:
1. The negotiation, execution and delivery by any director or officer of the
Company of the Purchase Agreement and any amendments thereto on such terms
and conditions as are acceptable to the directors of the Company in their
absolute discretion and the shareholders of the Company, be and are hereby
authorized for and behalf the Company to execute under seal or otherwise
all other instruments, documents, things and writings, and perform and do
all such other acts and things as in their discretion they deem advisable
for the purpose of giving effect to the Purchase Agreement.
2. These resolutions may be signed in counterpart, which taken together shall
constitute one and the same instrument, and any facsimile signature shall
be taken as an original.
______________________________
<PAGE>
Exhibit 3.1
ARTICLES OF INCORPORATION
OF
SPECTRUM VENTURES LTD.
The undersigned, who, if a natural person, is eighteen years of age or
older, hereby establishes a corporation pursuant to the Colorado Business
Corporation Act as amended and adopts the following Articles of Incorporation:
FIRST: The name of the corporation is Spectrum Ventures Ltd.
SECOND: The corporation shall have and may exercise all of the rights,
powers and privileges now or hereafter conferred upon corporations organized
under the laws of Colorado. In addition, the corporation may do everything
necessary, suitable or proper for the accomplishment of any of its corporate
purposes. The corporation may conduct part or all of its business in any part of
Colorado, the United States or the world and may hold, purchase, mortgage, lease
and convey real and personal property in any of such places.
THIRD: (a) The aggregate number of shares which the corporation shall have
authority to issue is 100,000,000 shares of common stock, $.001 par value. The
shares of this class of common stock shall have unlimited voting rights and
shall constitute the sole voting group of the corporation, except to the extent
any additional voting group or groups may hereafter be established in accordance
with the Colorado Business Corporation Act. The shares of this class shall also
be entitled to receive the net assets of the corporation upon dissolution.
(b) Each Shareholder of record shall have one vote for each share of
stock standing in his name on the books of the corporation and entitled to vote,
except that in the election of directors each shareholder shall have as many
votes for each share held by him as there are directors to be elected and for
whose election the shareholder has a right to vote. Cumulative voting shall not
be permitted in the election of directors or otherwise.
(c) Unless otherwise ordered by a court of competent jurisdiction, at
all meetings of shareholders a majority of the shares of a voting group entitled
to vote at such meeting, represented in person or by proxy, shall constitute a
quorum of that voting group.
FOURTH: The number of directors of the corporation shall be fixed by the
bylaws, or if the bylaws fail to fix such a number, then by resolution adopted
from time to time by the board of directors.
FIFTH: The street address of the initial registered office of the
corporation is 1560 Broadway, Denver, Colorado 80202. The name of the initial
registered agent of the corporation at such address is Corporation Service
Company.
SIXTH: The address of the initial principal office of the corporation is
1128-789 West Pender Street, Vancouver, British Columbia, Canada V6C 1H2.
<PAGE>
SEVENTH: The following provisions are inserted for the management of the
business and for the conduct of the affairs of the corporation, and the same are
in furtherance of and not in limitation or exclusion of the powers conferred by
laws.
(a) Conflicting Interest Transactions. As used in this paragraph,
"conflicting interest transaction" means any of the following: (i) a loan or
other assistance by the corporation to a director of the corporation or to an
entity in which a director of the corporation is a director or officer or has a
financial interest; (ii) a guaranty by the corporation of an obligation of a
director of the corporation or of an obligation of an entity in which a director
of the corporation is a director or officer or has a financial interest; or
(iii) a contract or transaction between the corporation and a director of the
corporation or between the corporation and an entity in which a director of the
corporation is a director or officer or has a financial interest. To the full
extent permitted by Colorado law, no conflicting interest transaction shall be
void or voidable, be enjoined, be set aside, or give rise to an award of damages
or other sanctions in a proceeding by a shareholder or by or in the right of the
corporation, solely because the conflicting interest transaction involves a
director of the corporation or any entity in which a director of the corporation
is a director of officer or has a financial interest, or solely because the
director is present at or participates in the meeting of the corporation's board
of directors or of the committee of the board of directors which authorizes,
approves or ratifies a conflicting interest transaction, or solely because the
director's vote is counted for such purpose if: (A) the material facts as to the
director's relationship or interest and as to the conflicting interest
transaction are disclosed or are known to the board of directors or the
committee, and the board of directors or committee in good faith authorizes,
approves or ratifies the conflicting interest transaction by the affirmative
vote of a majority of the disinterested directors, even though the disinterested
directors are less than a quorum; or (B) the material facts as to the director's
relationship or interest and as to the conflicting interest transaction are
disclosed or are known to the shareholders entitled to vote thereon, and the
conflicting interest transaction is specifically authorized, approved or
ratified in good faith by a vote of the shareholders; or (C) a conflicting
interest transaction is fair as to the corporation as of the time it is
authorized, approved or ratified in good faith by a vote of the shareholders; or
(D) a conflicting interest transaction is fair as to the corporation as of the
time it is authorized, approved or ratified by the board of directors, a
committee thereof, or the shareholders. Common or interested directors may be
counted in determining the presence of a quorum at a meeting of the board of
directors or of a committee which authorizes, approves or ratifies the
conflicting interest transaction.
(b) Indemnification. The corporation shall indemnify, to the
maximum extent permitted by Colorado law, any person who is or was a director,
officer, agent, fiduciary or employee of the corporation against any claim,
liability or expense arising against or incurred by such person made party to a
proceeding because he is or was a director, officer, agent , fiduciary or
employee of the corporation or because he is or was serving another entity or
employee benefit plan as a director, officer, partner, trustee, employee,
fiduciary or agent at the corporation's request. The corporation shall further
have the authority to the maximum extent permitted by Colorado law to purchase
and maintain insurance providing such indemnification.
2
<PAGE>
(c) Limitation on Director's Liability. No director of this corporation
shall have any personal liability for monetary damages to the corporation or its
shareholders for breach of his fiduciary duty as a director, except that this
provision shall not eliminate or limit the personal liability of a director to
the corporation or its shareholders for monetary damages for any breach, act,
omission or transaction as to which the Colorado Business Corporation Act (as in
effect from time to time) prohibits expressly the elimination or limitation of
liability. Nothing contained herein will be construed to deprive any director
of his right to all defenses ordinarily available to a director nor will
anything herein be construed to deprive any director of any right he may have
for contribution from any other director or other person.
EIGHTH: The name and address of the incoporator is:
Sandra L. Wainer
1801 California Street, Suite 3600
Denver, CO 80202
DATED the 23rd day of March, 1998
/s/ Sandra L. Wainer
----------------------------
Incorporator
Corporation Service Company hereby consents to the appointment as the
initial registered agent for Spectrum Ventures Ltd.
/s/ ILLEGIBLE
-----------------------------
Initial Registered Agent
<PAGE>
EXHIBIT 3.2
BYLAWS
OF
SPECTRUM VENTURES LTD.
(A Colorado Corporation)
ARTICLE 1
OFFICES
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Section 1. PRINCIPAL EXECUTIVE OFFICE
--------------------------
The Board of Directors is hereby granted full power and authority to
fix and locate and to change the principal executive office of the Corporation
from one location to another within or outside the State of Colorado or Province
of British Columbia. If the principal executive office is located outside this
state, and the Corporation has one or more business offices in this state, the
Board of Directors shall fix and designate a principal business office in the
Province of British Columbia, the location of which principal business office
shall be noted on the bylaws by the secretary, opposite this, or this section
may be amended to state the new location.
Section 2. OTHER OFFICES
-------------
Other business offices may at any time be established by the Board
of Directors at any place or places within or outside the State of Colorado, or
the Province of British Columbia.
ARTICLE II
MEETING OF SHAREHOLDERS
-----------------------
Section 1. PLACE OF MEETINGS
-----------------
All annual or other meetings of shareholders shall be held at the
principal executive office of the Corporation, or at any other place within or
without the State of Colorado or the Province of British Columbia or which may
be designated either by the Board of Directors or by the written consent of all
persons entitled to vote thereat and not present at the meeting, given either
before or after the meeting, and filed with the secretary of the Corporation.
Section 2. ANNUAL MEETINGS
---------------
The annual meetings of shareholders shall be held on the first
Tuesday of June in each year at 11:00 a.m. or at such date and/or time as shall
be determined by the Board of Directors provided, however, that should said day
fall upon a legal holiday, then any such annual meeting of shareholders shall be
held at the same time and place on the next day thereafter ensuing which is a
full business day At such meetings directors shall be elected, reports of the
affairs of the Corporation shall be considered, and any other business may be
transacted which is within the powers of the shareholders.
Written notice of each annual meeting shall be given to each
shareholder entitled to vote, either personally or by mail or other means of
written communication, charges prepaid, addressed to such shareholder at his
address appearing on the books of the Corporation or given by him to the
Corporation for the purpose of notice. If any notice or report addressed to the
shareholder at the address of such shareholder appearing on the books of the
Corporation is returned to the Corporation by the United States
<PAGE>
Postal Service marked to indicate that the United States Postal Service is
unable to deliver the notice or report to the shareholder at such address all
future notices or reports shall be deemed to have been duly given without
further mailing if the same shall be available for the shareholder upon written
demand of the shareholder at the principal executive office of the Corporation
for a period of one (1) year from the date of the giving of the notice or report
to all other shareholders. If a shareholder gives no address, notice shall be
deemed to have been given if sent by mail or other means of written
communication addressed to the place where the principal executive of the
Corporation is situated, or if published at least once in some newspaper of
general circulation in the country in which said principal executive office is
located.
All such notices shall be given to each shareholder entitled thereto
not less than ten (10) days nor more than sixty (60) days before each annual
meeting. Any such notice shall be deemed to have been given at the time when
delivered personally or deposited in the mail or sent by other means of written
communication. An affidavit of mailing of any such notice in accordance with the
foregoing provisions, executed by the secretary, assistant secretary or any
transfer agent of the Corporation shall be prima facie evidence of the giving of
----- -----
notice.
Such notice shall specify:
a) the place the date, and the hour of such meeting;
b) those flatters which time board, at the time of mailing of the
notice, intends to present tar action by the shareholders;
c) if directors are to be elected, the names of nominees intended
at the time of the notice to be presented by management for
election;
d) the general nature of a proposal, if any, to take action with
respect to approval of (i) a contract or other transaction with
an interested director, (ii) amendment of the Articles of
Incorporation, (iii) a reorganization of the Corporation, (iv)
voluntary dissolution of the Corporation, of (v) a distribution
in dissolution other than in accordance with the rights of
outstanding preferred shares, if any; and
e) such other matters, if any, as may be expressly required by
statute.
Section 3. SPECIAL MEETINGS
----------------
Special meetings of the shareholders, for the purpose of taking any
action permitted by the shareholders under the General Corporation Law and the
Articles of Incorporation of this corporation, may be called at any time by the
chairman of the board or the president, or by the Board of Directors, or by one
or more shareholders holding not less than ten percent (10%) of the votes at the
meting. Upon request, in writing that a special meeting of shareholders be
called for any proper purpose, directed to the chairman of the board, president,
vice president or secretary by any person (other than the board) entitled to
call a special meeting of shareholders, the officer forthwith shall cause notice
to be given to shareholders entitled to vote that a meting will be held at a
time requested by the person or persons calling the meeting, not less than
thirty-five (35) nor more than sixty (60) days after receipt of the request.
Except in special cases where other express provision is made by statute, notice
of such special meetings shall be given in the same manner as for annual
meetings of shareholders. In addition to the matters required by items (a) and,
if applicable, (c) of the preceding Section, notice of any special meeting shall
specify the general nature of the business to be transacted, and no other
business may be transacted at such meeting.
<PAGE>
Section 4. QUORUM
------
The presence in person or by proxy of the persons entitled to vote a
majority of the voting shares at any meeting shall constitute a quorum for the
transaction of business. The shareholders present at a duly called or held
meeting at which a quorum is present may continue to do business until
adjournment, notwithstanding the withdrawal of enough shareholders to leave less
than a quorum, if any action taken (other than adjournment) is approved by at
least a majority of the shares required to constitute a quorum.
Section 5. ADJOURNED MEETING AND NOTICE THEREOF
------------------------------------
Any shareholder's meeting, annual or special, whether or not a
quorum is present, may be adjourned from time to time by the vote of a majority
of the shares, the holders of which are either present in person or represented
by proxy thereat, but in the presence of a quorum no other business may
thereafter be transacted at such meeting, except as provided in Section 4 above.
When any shareholder's meeting, either annual or special, is
adjourned for forty-five (45) days or more, or if after adjournment a new record
date is fixed for the adjourned meeting, notice of the adjourned meeting shall
be given as in the case of an original meeting. Except as provided above, it
shall not be necessary to give any notice of the time and place of the adjourned
meeting or of the business to be transacted thereat, other than by announcement
of the time and place thereof at the meeting at which such adjournment is taken.
Section 6. VOTING
------
Unless a record date for voting purposes be fixed as provided in
Section 1 of Article VI of these bylaws then, subject to the provisions of the
General Corporation Law relating to voting of shares held by a fiduciary, in the
name of a Corporation or in joint ownership only persons in whose names shares
entitled to vote stand on the stock records of the Corporation at the close of
business on the business day next preceding the day on which the meeting of
shareholders is held shall be entitled to vote at such meeting, and such day
shall be the record date for such meeting. Such vote may be viva voce or by
---- ----
ballot; provided, however, that all elections for directors must be by ballot
upon demand made by a shareholder at any election and before the voting begins.
If a quorum is present, except with respect to election of directors, the
affirmative vote of the majority of the shares represented at the meeting and
entitled to vote on any matter shall be the act of the shareholders!, unless the
vote of a greater number or voting by classes is required by the General
Corporation Law or the Articles of Incorporation. Subject to the requirements of
the next sentence, every shareholder entitled to vote at any election for
directors shall have the right to cumulate his votes and give one candidate a
number of votes equal to the number of directors to be ejected multiplied by the
number of votes to which his shares are entitled, or to distribute his votes on
the same principle among as many candidates as he shall think fit. No
shareholder shall be entitled to cumulate votes unless the name of the candidate
or candidates for whom such votes would be cast has been placed in nomination
prior to the voting and any shareholder has given notice at the meeting prior to
the voting, of such shareholder's intention to cumulate his votes. The
candidates receiving the highest number of votes of shares entitled to be voted
for them, up to a number of directors to be elected, shall be elected.
Section 7. VALIDATION OF DEFECTIVELY CALLED OR NOTICED MEETINGS
----------------------------------------------------
The transactions of any meetings of shareholders, either annual or
special, however called and noticed, shall be as valid as though had at a
meeting duly held after regular call and notice, if a quorum be present either
in person or by proxy, and if, either before or after the meeting, each of the
persons entitled to vote, not present in person or by proxy, or who, though
present, has, at the beginning of the meeting, not properly objected to the
transaction of any business because the meeting was not lawfully called or
convened, or to particular matters of business legally required to be included
in the notice, but not so included, signs a written waiver of notice, or a
consent to the holding of such meeting, or an approval of
<PAGE>
the minutes thereof. All such waivers, consents or approvals shall be filed with
the corporate records or made a part of the minutes of the meeting.
Section 8. ACTION WITHOUT MEETING
----------------------
Directors may be elected without a meeting by a consent in writing,
setting forth the action so taken, signed by all of the persons who would be
entitled to vote for the election of directors, provided that without notice
except as hereinafter se forth, a director may be elected at any time by the
written consent of persons holding a majority of the outstanding shares entitled
to vote for the election of directors to fill a vacancy on the Board of
Directors that has not been filled by the directors.
Any other action which, under any provision of the General
Corporation Law, may be taken at a meeting of the shareholders may be taken
without a meeting, and without notice except as hereinafter set forth, if a
consent in writing, setting forth the action so taken, is singed by the holders
of outstanding shares having not less than the minimum number of votes that
would be necessary to authorize or take such action at a meeting at which all
shares entitled to vote thereon were present and voted. Unless the consents of
all shareholders entitled to vote have been solicited in writing:
(a) Notice of any proposed shareholder approval of, (i) a contract
or other transaction with an interested director, (ii) indemnification of any
person authorized by Section 15 of Article III of these bylaws, (iii) a
reorganization of the Corporation as defined in the General Corporation Law, or
(iv) a distribution in dissolution other than in accordance with the rights of
outstanding preferred shares, if any, without a meeting by less than unanimous
written consent, shall be given at least ten (10) days before the consummation
of the action authorized by such approval; and
(b) Prompt notice shall be given of the taking of any other
corporate action approved by shareholders without a meeting by less than
unanimous written consent, to those shareholders entitled to vote who have not
consented in writing. Such notices shall be given in the manner and shall be
deemed to have been given as provided in Section 2 of Article II of these
bylaws.
Unless, as provided in Section 1 of Article VI of these bylaws, the
Board of Directors has fixed a record date for the determination of shareholders
entitled to notice of and to give such written consent, the record date for such
determination shall be the day on which the first written consent is given. All
such written consents shall be filed with the secretary of the Corporation.
Any shareholder giving a written consent, or the shareholder's
proxyholders, or a transferee of the shares or a personal representative of the
shareholder or their respective proxyholders, may revoke the consent by a
writing received by the Corporation prior to the time that written consents of
the number of share required to authorize the proposed action have been filed
with the secretary of the Corporation, but may not do so thereafter. Such
revocation is effective upon its receipt by the secretary of the Corporation.
Section 9, PROXIES
-------
Every person entitle to vote or execute consents shall have the
right to do so either person or by one (1) or more agents authorized by a
written proxy executed by such person or his duly authorized agent and filed
with the secretary of the Corporation. Any proxy duly executed is not revoked
and continues in full force and effect until, (i) an instrument revoking it or a
duly executed proxy bearing a later date is filed with the secretary of the
Corporation prior to the vote pursuant thereto, (ii) the person executing the
proxy attends the meeting and votes in person or (iii) written notice of the
dearth or incapacity of the maker of such proxy is received by the Corporation
before the vote pursuant thereto is counted; provided that no such proxy shall
be valid after the expiration of eleven (11) months from the date of its
execution, unless the person executing it specified therein the length of time
for which such proxy is to continue in force.
<PAGE>
Section 10. INSPECTORS OF ELECTION
----------------------
In advance of any meeting of shareholders, the Board of Directors
may appoint any persons other than nominees for office as inspectors of election
to act at such meeting of any adjournment thereof. If inspectors of election be
not so appointed, the chairman of any such meeting may, and on request of any
shareholder or his proxy shall, make such appointment at the meeting. The number
of inspectors shall be either one (1) or three)3). It appointed at a meeting on
the request of one (1) or more shareholders or proxies, the majority of shares
represented in person or by proxy shall determine whether one (1) or three (3)
inspectors are to be appointed. In case any person appointed as inspector fails
to appear or fails or refuses to act, the vacancy may, and on the request of any
shareholder or a shareholder's proxy shall, be filled by appointment by the
Board of Directors in advance of the meeting, or at the meeting by the chairman
of the meeting.
The duties of such inspectors shall be as prescribed by the General
Corporation Law and shall include: determining the number of shares outstanding
and the voting power of each, the shares represented at the meeting, the
existence of a quorum, the authenticity, validity and effect of proxies;
receiving votes, ballots or consents; hearing and determining all challenges and
questions in any way arising in connection with the right to vote; counting and
tabulating all votes or consents; determining when the polls shall close;
determining the result; and such acts as determination of the validity and
effect or proxies, the dates contained on the forms of proxy shall presumptively
determine the order of execution of the proxies, regardless of the postmark
dates on the envelopes in which they are mailed.
The inspectors of election shall perform their duties impartially in
good faith, to the best of their ability and as expeditiously as a practical. If
there are three (3) inspectors or election, the decision, act or certificate of
a majority is effective in all respects as the decision, act or certificate of
all. Any report or certificate made by the inspectors of election is prima facie
----- -----
evidence of the facts stated therein
ARTICLE III
DIRECTORS
---------
Section 1. POWERS
------
Subject to limitations in the Articles of Incorporation and to the
provisions of the General Corporation Law as to action to be authorized or
approved by the shareholders or by the outstanding shares, and subject to the
duties of directors as prescribed by the bylaws, all corporate powers shall be
exercised by or under the authority of, and the business and affairs of the
Corporation shall be controlled by, the Board of Directors. Without prejudice
to such general powers, but subject to the dame provisions and limitations, it
is hereby expressly declared that the directors shall have the following powers,
to wit:
First - To select and remove all the officers, agents and employees
-----
of the Corporation, prescribe such powers and duties for them as may
not be inconsistent with law, with the Articles of Incorporation or
the bylaws, fix their compensation and require security for faithful
service.
Second - To conduct, manage and control the affairs and business of
------
the Corporation, and to make such rules and regulations therefor not
inconsistent with law, or with the Articles of Incorporation or the
bylaws, as they may deem best.
Third - To change the principal executive office and principal
-----
office for the transaction of the business of the Corporation from
one location to another as provided in Article 1,
<PAGE>
Section 1, hereof; to fix and locate from time to time one or more
subsidiary offices of the Corporation within or without the State of
Colorado as provided in Article 1, Section 2, hereof; to designate
any place within or without the State of Colorado or Province of
British Columbia to hold shareholders meeting or meetings; and to
adopt, make and use a corporate seal, and to prescribe the forms of
certificates from time to time, as in their judgement they may deem
best, provided such seal and such certificates shall at all times
comply with the provisions of law.
Fourth - To authorize the issue of shares of stock of the
------
Corporation from time to time, upon such terms as may be lawful.
Fifth - To borrow money and incur indebtedness for the purposes of
-----
the Corporation, and to cause to be executed and delivered therefor,
in the corporate name, promissory notes, bonds, debentures, deeds of
trust, mortgages, pledges, hypothecations or other evidence of debt
and securities therefor.
Sixth - By resolution adopted by a majority of the authorized
-----
number of directors, to designate an executive and other committees,
each consisting of two (2) or more directors, to serve at the
pleasure of the board, and to prescribe the manner in which
proceedings of such committee shall be conducted. Unless the Board
of Directors shall otherwise prescribe the manner of proceedings of
any such committee meetings of such committee may be regularly
scheduled in advance and may be called at any time by any two (2)
members thereof; otherwise, the provisions of these bylaws with
respect to notice and conduct of meetings of the board shall govern.
Any such committee, to the extent provided in a resolution of the
board shall have all of the authority of the board, except with
respect to:
(a) the approval of any action for which the General
Corporation Law or the Articles of Incorporation also
require shareholder approval
(b) the filing of vacancies on the board or any committee;
(c) the fixing of compensation of the directors for serving on
the board or on any committee
(d) the adoption, amendment or repeal of bylaws;
(e) the amendment of repeal of any resolution of the board;
(f) any distribution to the shareholders, except at a rate or
in a periodic amount or within a price range determined by
the board; and
(g) the appointment of other committees of the board or the
members thereof.
Section 2. NUMBER AND QUALIFICATION OF DIRECTORS
-------------------------------------
The authorized number of directors of the Corporation shall be not
less than one (1) nor more than five (5). The exact number of authorized
directors shall be one (1) until changed, within the limits specified above, by
a bylaw amending this section, duly adopted by the board of directors or by the
shareholders. The maximum or minimum number of directors cannot be changed nor
can a fixed number be substituted for the maximum and minimum numbers, except by
a duly adopted amendment to the articles of incorporation or by an amendment to
this bylaw duty approved by a majority of the outstanding shares entitled to
vote.
<PAGE>
Section 3. ELECTION AND TERM OF OFFICE
---------------------------
The directors shall be elected at each annual meeting of
shareholders but, if any such annual meeting is not held or the directors are
not elected thereat, the directors may be elected at any special meeting of
shareholders held for that purpose. All directors shall hold office until their
respective successors are elected, subject to the General Corporation Law and
the provisions of these bylaws with respect to vacancies on the board.
Section 4. VACANCIES
---------
A vacancy in the Board of Directors shall be deemed to exist in case
of the death, resignation or removal of any director, if a director has been
declared of unsound mind by order of court or convicted of a felony, if the
authorized number of directors be increased, or if the shareholders tail, at any
annual or special meeting of shareholders at which any director or directors are
elected, to elect the full authorized number of directors to be voted for at
that meeting.
Vacancies in the Board of Directors, except for a vacancy created by
the removal of any directors, may be filled by a majority of the remaining
directors, though less than a quorum, or by a sole remaining director, and each
director so elected shall hold office until his successor is selected at an
annual or a special meeting of the shareholders. A vacancy in the Board of
Directors created by the removal of a director may only be filled by the vote of
a majority of the shares entitled to vote represented at a duly held meeting at
which a quorum is present, or by the written consent of the holders of a
majority of the outstanding shares.
The shareholders may elect a director or directors at any time to
fill any vacancy or vacancies not filled by the directors. Any such election by
written consent shall require the consent of holders of a majority of the
outstanding shares entitled to vote.
Any director may resign effective upon giving written notice to the
chairman of the board, the president, the secretary or the Board of Directors of
the Corporation, unless the notice specifies a later time for the effectiveness
of such resignation. If the Board of Directors accepts the resignation of a
director tendered to take effect at a future time, the board or the shareholders
shall have the power to elect a successor to take office when the resignation is
to become effective.
No reduction of the authorized number of directors shall have the
effect of removing any director prior to the expiration of his term of office.
Section 5. PLACE OF MEETINGS AND MEETINGS BY TELEPHONE
-------------------------------------------
Regular meetings of the Board of Directors shall be held at any
place within or without the State of Colorado which has been designated from
time to time by resolution of the board or by written consent of all members of
the board. In the absence of such designation, regular meetings shall be held at
the principal executive office of the Corporation. Special meetings of the board
may be held either at a place so designated or at the principal executive office
of the Corporation. Any meeting, regular or special, may e held by conference,
telephone or similar communications equipment, so long as all directors
participating in the meeting can hear one another and all such directors shall
be deemed to be present at the meeting.
Section 6. ANNUAL MEETING
--------------
Immediately following each annual meeting of shareholders, the Board
of Directors shall hold a regular meeting at the place of said annual meeting or
at such other place as shall be fixed by the
<PAGE>
Board of Directors, for the purpose of organization, election of officers, and
the transaction of other business. Call and notice of such meetings are hereby
dispensed with.
Section 7. OTHER REGULAR MEETINGS
----------------------
Other regular meetings of the Board of Directors shall be held
without call at such time as shall from time to time be fixed by the Board of
Directors. Such regular meetings may be held without notice.
Section 8. SPECIAL MEETINGS
----------------
Special meetings of the Board of Directors for any purpose or
purposes shall be called at any time by the chairman of the board, president,
any vice president, the secretary or by any two (2) directors.
Written notice of the time and place of special meetings shall be
delivered personally to each director communicated to each director by
telephone, or by telegraph or mail, charges prepaid, addressed to him at his
address as it is shown upon the records of the Corporation or, if it is not so
shown on such records or is not readily ascertainable, at the place at which the
meetings of the directors are regularly held. In case such notice is mailed or
telegraphed, it shall be deposited in the United States mail or delivered to the
telegraph company in the place in which the principal executive office of the
Corporation is located at least forty-eight (48) hours prior to the time of the
holding of the meeting. In case such notice is delivered, personally or by
telephone, as above provided, it shall be delivered at least twenty-four (24)
hours prior to the time of the holding of the meeting. Such mailing,
telegraphing or delivery, personally or by telephone, as above provided, shall
be due, legal and personal notice to such director.
Any notice shall state the date, place and hour of the meeting and
the general nature of the business to be transacted, and no other business may
be transacted at the meeting.
Section 9. ACTION WITHOUT MEETING
----------------------
Any action by the Board of Directors may be taken without a meeting
if a quorum of the members of the board shall individually or collectively
consent in writing to such action. Such written consent or consents shall be
filed with the minutes of the proceedings of the board and shall have the same
force and effect as a quorum vote of such directors.
Section 10. ACTIONS AT A MEETING: QUORUM AND REQUIRED VOTE
----------------------------------------------
Presence of a majority of the authorized number of directors at a
meeting of the Board of Directors constitutes a quorum for the transaction of
business, except as hereinafter provided. Members of the board may participate
in a meeting through use of conference telephone or similar communications
equipment, so long as all members participating in such meeting can hear one
another. Participation in a meeting as permitted in the preceding sentence
constitutes presence in person at such meeting. Every act or decision done or
made by a majority of the directors present at a meeting duly held at which a
quorum is present shall be regarded as the act of the Board of Directors, unless
a greater number, or the same number after disqualifying one (1) or more
directors from voting, is required by law, by the Articles of Incorporation, or
by these bylaws. A meeting at which a quorum is initially present may continue
to transact business notwithstanding the withdrawal of a director, provided that
any action taken is approved by at least a majority of the required quorum for
such meeting.
Section 11. VALIDATION OF DEFECTIVELY CALLED OR NOTICE MEETING
--------------------------------------------------
The transactions of any meeting of the Board of Directors, however
called and noticed or wherever held, shall be as valid as though had at a
meeting duly held after regular call and notice, if a
<PAGE>
quorum is present and if, either before or after the meeting, each of the
directors not present or who, though present, has prior to the meeting or at its
commencement, protested the lack of proper notice to him, signs a written waiver
of notice or a consent to holding such meeting or an approval of the minutes
thereof. All such waivers, consents or approvals shall be filed with the
corporate records or made a part of the minutes of the meeting.
Section 12. ADJOURNMENT
-----------
A quorum of the directors may adjourn any directors' meeting to meet
again at a stated day and hour; provided however, that in the absence of a
quorum, a majority of the directors present at any directors' meeting, either
regular or special, may adjourn from time to time until the time fixed for the
next regular meeting of the board.
Section 13. NOTICE OF ADJOURNMENT
---------------------
If the meeting is adjourned for more than twenty-four (24) hours,
notice of any adjournment to another time or place shall be given prior to the
time of the adjourned meeting to the directors who were not present at the time
of adjournment. Otherwise, notice of the time and place of holding an adjourned
meeting need not be given to absent directors if the time and place be fixed at
the meeting adjourned.
Section 14. FEES AND COMPENSATION
---------------------
Directors and members of committees may receive such compensation,
if any, for their services, and such reimbursement for expenses, as may be fixed
or determined by resolution of the board.
Section 15. INDEMNIFICATION OF AGENTS OF THE CORPORATION:
---------------------------------------------
PURCHASE OF LIABILITY INSURANCE
-------------------------------
(a) Upon and in the event of a determination by the Board of
Directors of this Corporation, this Corporation shall have the
power to indemnify any person who is or was a director,
officer, employee, or other agent of this Corporation or of its
predecessor, or is or was serving as such of another
Corporation, partnership joint venture, trust, or other
enterprise, at the request of this Corporation against
expenses, judgements, fines, settlements, and other amounts
actually and reasonably incurred in connection with any
threatened, pending, or completed action or proceeding, whether
civil criminal administrative, or investigative, to the fullest
extent permitted under law.
(b) Upon and in the event of a determination by the Board of
Directors of this Corporation to purchase liability insurance,
this Corporation shall have the power to purchase and maintain
insurance on behalf of any agent of the Corporation against any
liability asserted against or incurred by the agent in such
capacity or arising out of the agent's status as such whether
or not this Corporation would have the power to indemnify the
agent against such liability under the provisions of this
section.
ARTICLE VI
OFFICERS
--------
Section 1. OFFICERS
--------
<PAGE>
The officers of the Corporation shall be a president, a secretary
and a chief financial officer. The Corporation may also have, at the discretion
of the Board of Directors, a chairman of the board, one or more vice presidents,
one or more assistant secretaries, one or more assistant treasurers, and such
other officers as may be appointed in accordance with the provisions of Section
3 of this Article. Any number of offices may be held by the same person.
Section 2. ELECTIONS
---------
The officers of the Corporation, except such officers as may be
appointed in accordance with the provisions of Section 3 or Section 5 of this
Article, shall be chosen annually by the Board of Directors, and each such
officer shall hold office until he shall resign or shall be removed or otherwise
disqualified to serve, or his successor shall be elected and qualified.
Section 3. SUBORDINATE OFFICERS, ETC.
--------------------------
The Board of Directors may appoint, and may empower the president to
appoint, such other officers as the business of the Corporation may require,
each of whom shall hold office, for such period, have such authority and perform
such duties as are provided in the bylaws or as the Board of Directors may from
time to time determine.
Section 4. REMOVAL AND RESIGNATION
-----------------------
Any officer may be removed, either with or without cause, by the
Board of Directors, at any regular or special meeting thereof, or, except in
case of an officer chosen by the Board of Directors, by any officer upon whom
such power of removal may be conferred by the Board of Directors, by any officer
upon whom such power of removal may be conferred by the Board of Directors
(subject, in each case, to the rights, if any, of an officer under any contract
of employment).
Any officer may resign at any time by giving written notice to the
Board of Directors or to the president, or to the secretary of the Corporation,
without prejudice, however, to the rights, if any, of the Corporation under any
contract to which such officer is a party. Any such resignation shall take
effect at the date of the receipt of such notice or at any later time specified
therein, and, unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.
Section 5. VACANCIES
---------
A vacancy in any office because of death, resignation, removal,
disqualification or any other cause shall be filled in the manner prescribed in
the bylaws for regular appointment to such office.
Section 6. CHAIRMAN OF THE BOARD
---------------------
The chairman of the board, if there shall be such an officer, shall,
if present, preside at all meetings of the Board of Directors and exercise and
perform such other powers and duties as may be from time to time assigned to him
by the Board of Directors or prescribed by the bylaws.
Section 7. PRESIDENT
---------
Subject to such supervisory powers, if any, as may be given by the
Board of Directors to the chairman of the board if there be such an officer, the
president shall be the chief executive officer of the Corporation and shall,
subject to the control of the Board of Directors, have general supervision,
direction and control of the business and officers of the Corporation. He shall
preside at all meetings of the shareholders and, in the absence of the chairman
of the board, or if there be none, at all meetings of the Board of Directors. He
shall be ex officio a member of all the standing committees, including the
-- -------
executive committee, if any, and shall have the general powers, and duties of
management usually vested
<PAGE>
in the office of president of a Corporation, and shall have such other powers
and duties as may be prescribed by the Board of Directors or the bylaws.
Section 8. VICE PRESIDENT
--------------
In the absence or disability of the president, the vice presidents
in order of their rank as fixed by the Board of Director or, if not ranked, the
vice president designated by the Board of Directors, shall perform all the
duties of the president, and when so acting, shall have all the powers of, and
be subject to all the restrictions upon, the powers of the president and perform
such other duties as from time to time may be prescribed for them respectively
by the Board of Directors or the bylaws.
Section 9. SECRETARY
---------
The secretary shall record or cause to be recorded, and shall keep
or cause to be kept, at the principal executive office and such other place as
the Board of Directors may order, a book of minutes of actions taken at all
meetings of directors and shareholders, with the time and place of holding,
whether regular or special, and, if special, how authorized, the notice thereof
given, the names of those present at directors' meetings, the number of shares
present or represented at shareholders meetings and the proceedings thereof.
The secretary shall keep, or cause to be kept, at the principal
executive office or at the office of the Corporation's transfer agent, a share
register, or a duplicate share register, showing the names of the shareholders
and their addresses, the number and classes of shares held by each, the number
and date of certificates issued for the same, and the number and date of
cancellation of every certificate surrendered for cancellation.
The secretary shall give, or cause to be given, notice of all the
meetings of the shareholders and of the Board of Directors required by the
bylaws or by law to be given, and he shall keep the seal of the Corporation safe
custody, and shall have such other powers and perform such other duties as may
be prescribed by the Board of Directors or by the bylaws.
Section 10. CHIEF FINANCIAL OFFICER
-----------------------
The chief financial officer, who shall also be deemed to be the
treasurer when a treasurer may be required, shall keep and maintain or cause to
be kept and maintained, adequate and correct accounts of the properties and
business transactions of the Corporation including accounts of its assets,
liabilities, receipts, disbursements, gains, losses, capital, surplus and
shares. Any surplus, including earned surplus, paid-in surplus and surplus
arising from a reduction of stated capital, shall be classified according to
source and shown in a separate account. The books of account shall at all
reasonable times be open to inspection by any director.
The chief financial officer shall deposit all moneys and other
valuables in the names and to the credit of the Corporation with such
depositories as may be designated by the Board of Directors, shall render to the
president and directors whenever they request it, an account of all of his
transactions as treasurer and of the financial condition of the Corporation, and
shall have such other powers and perform such other duties as may be prescribed
by the Board of Directors or the bylaws.
ARTICLE V
RECORDS AND REPORTS
- -------------------
Section 1. MAINTENANCE AND INSPECTION OF SHARE REGISTER
--------------------------------------------
<PAGE>
The Corporation shall keep at its principal executive office, or at
the office of its transfer agent or registrar, if either be appointed, and as
determined by resolution of the Board of Directors, a record of its
shareholders, giving the names and addresses of all shareholders and the number
and class of shares held by each shareholder.
A shareholder or shareholders of the Corporation holding at least
five percent (5%) in the aggregate of the outstanding voting shares of the
Corporation may (i) inspect and copy the records of shareholders' names and
addresses and shareholdings during usual business hours on five (5) days prior
written demand on the Corporation, and (ii) obtain from the transfer agent of
the Corporation on written demand and on the tender of such transfer agent's
usual charges for such list, a list of the shareholders' names and addresses,
who are entitled to vote for the election of directors, and their shareholdings,
as of the most recent record date for which that list has been compiled or as of
a date specified by the shareholder after the date of demand. This list shall be
made available to any such shareholder by the transfer agent on or before the
later of five (5) days after the demand is received or the date specified in the
demand as the date as of which the list is to be compiled. The record of
shareholders shall also be open to inspection on the written demand of any
shareholder or holder of a voting trust certificate, at any time during usual
business hours, for a purpose reasonably related tot he holder's interest as a
shareholder or as the holder of a voting trust certificate. Any inspection and
copying under this Section 1 may be made in person or by an agent or attorney of
the shareholder or holder of a voting trust certificate making the demand.
Section 2. MAINTENANCE AND INSPECTION OF BYLAWS
------------------------------------
The Corporation shall keep at its principal executive office or if
its principal executive office is not in the State of Colorado at its principal
business office in this State, the original or a copy of the bylaws as amended
to date, which shall be open to inspection by the shareholders at all reasonable
times during office hours, if the principal executive office of the Corporation
is outside the State of Colorado and the Corporation has no principal business
office in this state, the Secretary shall, upon the written request of any
shareholder, furnish to that shareholder a copy of the bylaws as amended to
date.
Section 3. MAINTENANCE AND INSPECTION OF OTHER CORPORATE RECORDS
-----------------------------------------------------
The accounting books and records and minutes of proceedings of the
shareholders and the Board of Directors and any committee of the Board of
Directors shall be kept at such place or places designated by the Board of
Directors, or, in the absence of such designation at the principal executive
office of the Corporation. The minutes shall be kept in written form or any
other form capable of being converted into written form. The minutes and
accounting books and records shall be open to inspection upon the written
demand of any shareholder or holder of a voting trust certificate, at any
reasonable time during usual business hours, for a purpose reasonably related to
the holder's interests as a shareholder or as the holder of a voting trust
certificate. The inspection may be made in person or by an agent or attorney,
and shall include the right to copy and make extracts. These rights of
inspection shall extend to the records of each subsidiary Corporation of the
Corporation.
Section 4. INSPECTION BY DIRECTORS
-----------------------
Every director shall have the absolute right at any reasonable time
to inspect all books, records, and documents of every kind and the physical
properties of the Corporation and each of its subsidiary Corporations. This
inspection by a director may be made in person or by an agent or attorney and
the right of inspection includes the right to copy and make extracts of
documents.
Section 5. ANNUAL REPORT TO SHAREHOLDERS
-----------------------------
The Board of Directors of the Corporation shall not be required to
cause an annual report to be sent to the shareholders so long as there are less
than one hundred (100) holders of record of its
<PAGE>
shares. If the Board of Directors so resolves, by a vote of a majority of the
directors, the Board of Directors shall cause an annual report to be sent to the
shareholders not later than one hundred twenty (120) days after the close of the
fiscal or calendar year. Such report shall contain a balance sheet as of the end
of such fiscal year, accompanied by any report thereon of independent
accountants, or, if there is no such report, the certificate of authorized
officer of the Corporation that such statements were prepared without audit from
the books and records of the Corporation. Nothing herein shall be interpreted as
prohibiting the Board of Directors from issuing other periodic reports to the
shareholders of the Corporation as the Board of Directors consider appropriate.
Section 6. FINANCIAL STATEMENTS
--------------------
A copy of any annual financial statement and any Income statement of
the Corporation for each quarterly period of each fiscal year, and any
accompanying balance sheet of the Corporation as of the end of each such period
that has been prepared by the Corporation shall be kept on file in the principal
executive office of the Corporation for twelve (12) months and each such
statement shall be exhibited at all reasonable times to any shareholder
demanding an examination of any such statement or a copy shall be mailed to any
such shareholder.
For the three-month, six-month or nine-month period of the then
current fiscal year ended more than thirty (30) days before the date of the
request, and a balance sheet of the Corporation as of the end of that period,
the chief financial officer shall cause that statement to be prepared, if not
already prepared, and shall deliver personally or mail that statement or
statements to the person making the request within thirty (30) days after
receipt of the request. If the Corporation has not sent to the shareholders its
annual report for the last fiscal year, this report shall likewise be delivered
or mailed to the shareholder or shareholders within thirty (30) days after the
request. If a shareholder or shareholders holding at least five percent (5%) of
the outstanding shares of any class of stock of the Corporation makes a written
request to the Corporation for an income statement of the Corporation
The quarterly income statements and balance sheets referred to i n
this section shall be accompanied by the report of the independent accountants
if any engaged by the Corporation or the certificate of an authorized officer of
the Corporation that the financial statements were prepared without audit from
the books and records of the Corporation.
ARTICLE VI
GENERAL CORPORATE MATTERS
-------------------------
Section 1. RECORD DATE
-----------
The Board of Directors may fix a time in the future as a record date
for the determination of the shareholders entitled to notice of and to vote at
any meeting of shareholders to receive any dividend or distribution, or any
allotment of rights, or to exercise rights in respect to any change, conversion,
or exchange of shares. The record date so fixed shall be not more than sixty
(60) days prior to any other event for the purposes of which it is fixed. When a
record date is so fixed, only shareholders of record on that date are entitled
to notice of and to vote at any such meeting, to give consent without a meeting,
to receive any report, to receive a dividend, distribution, or allotment of
rights, or to exercise the rights, as the case may be, notwithstanding any
transfer of any shares on the books of the Corporation after the record date,
except as otherwise provided in the Articles of Incorporation or bylaws.
Section 2. CHECKS, DRAFTS, ETC.
--------------------
All checks, drafts or other orders for payment of money, notices or
other evidences of indebtedness, issued in the name of or payable to the
Corporation, shall be signed or endorsed by such
<PAGE>
person or persons and in such manner as, from time to time shall be determined
by resolution of the Board of Directors.
Section 3. CORPORATE CONTRACTS AND INSTRUMENTS HOW EXECUTED
------------------------------------------------
The Board of Directors, except as otherwise provided in the bylaws,
may authorize any officer or officers, agent or agents, to enter into any
contract or execute any instrument in the name of and on behalf of the
Corporation, and such authority may be general or confined to specific
instances; and, unless so authorized by the Board of Directors, no officer,
agent or employee shall have any power or authority to bind the Corporation by
any contract or engagement or to pledge its credit or to render it liable for
any purpose or to any amount.
Section 4. CERTIFICATE FOR SHARES
----------------------
Every holder of shares in the Corporation shall be entitled to have
a certificate signed in the name of the Corporation by the chairman or vice
chairman of the board or the president or vice president and by the chief
financial officer or an assistant treasurer or the secretary or any assistant
secretary, certifying the number of shares and the class or series of shares
owned by the shareholder. Any of the signatures on the certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificate is
issued, it may be issued by the Corporation with the same effect as if such
person were an officer, transfer agent or registrar at the date of issue.
Any such certificate shall also contain such legend or other
statement as may be required by the Colorado Revised Statutes, the federal
securities laws, and any agreement between the Corporation and the issue
thereof.
Certificates for shares may be issued trio to full payment under
such restrictions and for such purposes as the Board of Directors or the bylaws
may provide; provided, however, that any such certificate so issued prior to
full payment shall state on the face thereof the amount remaining paid and the
terms of payment thereof.
No new certificate for shares shall be issued in lieu of an old
certificate unless the latter is surrendered and cancelled at the same time;
provided, however, that a new certificate will be issued without the surrender
and cancellation of the old certificate if (1) the old certificate is lost,
apparently destroyed or wrongfully taken; (2) the request for the issuance of
the new certificate is made within a reasonable time after the owner of the old
certificate has notice of its loss, destruction, or theft; (3) the request for
the issuance of a new certificate is made prior to the receipt of notice by the
Corporation that the old certificate has been acquired by a bona fide purchaser;
(4) the owner of the old certificate files a sufficient indemnity bond with or
provides other adequate security to the Corporation; and (5) the owner satisfies
any other reasonable requirements imposed by the Corporation.
Section 5. REPRESENTATION OF SHARES OF OTHER CORPORATIONS
----------------------------------------------
The president or any vice president and the secretary or any assistant secretary
of this Corporation are authorized to vote, represent and exercise on behalf of
this Corporation all rights incident to any and all shares of any other
corporation or corporations standing in the name of this Corporation. The
authority herein granted to said officers to vote or represent on behalf of this
Corporation any and all shares held by this Corporation in any other corporation
or corporations may be exercised either by such officers in person or by any
other person authorized to do so by proxy or power of attorney duly executed by
said officers.
<PAGE>
Section 6. CONSTRUCTION AND DEFINITIONS
----------------------------
Unless the context otherwise requires, the general provisions, rules
of construction and definitions contained in the Colorado Revised Statutes shall
govern the construction of these bylaws. Without limiting the generality of the
foregoing, the masculine gender includes the feminine and neuter, the singular
number includes the plural and the plural number includes the singular, and the
term "person" includes a Corporation as well as a natural person.
ARTICLE VII
AMENDMENTS
----------
Section 1. POWER OF SHAREHOLDERS
---------------------
New bylaws may be adopted or these bylaws may be amended or repealed
by the affirmative vote of a majority of the outstanding shares entitled to
vote, or by the written assent of the shareholders entitled to vote such shares,
except as otherwise provided by law or by the Articles of Incorporation;
provided, however, that if the Articles of Incorporation set forth the number of
authorized directors of the Corporation the authorized number of directors may
be changed only by an amendment of the Articles of Incorporation.
Section 2. POWER OF DIRECTORS
------------------
Subject to the right of shareholders as provided Section 1 of this
Article VII to adopt, amend or repeal bylaws, other than a bylaw or amendment
thereof changing the authorized number of directors, may be adopted, amended or
repealed by the Board of Directors.
CERTIFIED TO BE THE BYLAWS OF:
SPECTRUM VENTURES LTD.
By:
---------------------------
Secretary
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
NUMBER SHARES
- ------------ ------------
SPECTRUM VENTURES LTD.
- ------------ INCORPORATED UNDER THE TERMS OF THE STATE OF COLORADO ------------
100.000 000 SHARED
--------------------
CUSIP 84763T 10 7
--------------------
SEE REVERSE
FOR CERTAIN DEFINITIONS
</TABLE>
THIS CERTIFIES THAT
Is The Owner of
FULLY PAID AND NON-ASSESSABLE SHARES OF $.001 PAR VALUE COMMON STOCK OF
SPECTRUM VENTURES LTD.
transferable only on the books of the Company in person or by authorized
attorney upon surrender of this Certificate properly endorsed. This Certificate
is not valid unless countersigned by the Transfer Agent and Registrar.
IN WITNESS WHEREOF, the said Company has caused this Certificate to be
executed by the facsimile signatures of its duly authorized officers and to be
sealed with the facsimile seal of the Company.
Dated:
SPECTRUM VENTURES LTD.
CORPORATE
SEAL
SECRETARY COLORADO PRESIDENT
COUNTERSIGNED AND REGISTERED:
AMERICAN SECURITIES TRANSFER & TRUST, INC.
P.O. Box 1598
Denver, Colorado 80201
By:
---------------------------------------------
Transfer Agent & ______ Authorized Signature
<PAGE>
EXHIBIT 10.1
CONSULTING AGREEMENT
THIS AGREEMENT made the First day of September, 1998.
BETWEEN:
Emmanuel Aligizakis, an individual residing in the city of Vancouver
in the Province of British Columbia.
(hereinafter referred to as the "Consultant")
--"and --
SPECTRUM VENTURES LTD., a corporation incorporated under the laws of
the State of Colorado and having its head office in Vancouver.
(hereinafter referred to as the "Corporation")
The Corporation is desirous of retaining the Consultant to provide
consulting services in connection with the Business of the Corporation;
The Consultant is desirous of providing such services to the Corporation, on
the terms and subject to the conditions herein set out;
In consideration of the respective covenants and agreements of the parties
contained herein, the sum of one dollar paid by each party to each other and
other good and valuable consideration (the receipt and sufficiency of which is
hereby acknowledged by each of the parties hereto), it is agreed as follows:
Retainer. The Corporation hereby agrees to retain the Consultant to provide the
Corporation with consulting services consisting of managerial Services, labor
negotiations, contract negotiations, financial Services, and such other
consulting Services as the Corporation and the Consultant may from time to time
agree upon, (the "Services") and the Consultant hereby agrees to provide such
Services to the Corporation.
Term of Agreement. This Agreement shall remain in full force and effect from
September 1,998 to December 31, 1999, subject to earlier termination as
hereinafter provided, with the said term being capable of extension by mutual
written agreement of the parties hereto.
Provision of Services. The Services to be provided hereunder to the Corporation
by the Consultant shall be provided by the Consultant. It is agreed and
acknowledged that the Consultant may provide services to other persons, firms
and corporations, provided that the Consultant shall at no time while this
agreement remains in force provide ongoing managerial services to any competitor
of the Corporation that is not an affiliate (for the purposes of this Agreement
"Affiliate" shall mean any person, firm or corporation that is affiliated with
the Corporation).
Board Policy and Instructions. The Consultant covenants with the Corporation
that he will act in accordance with any policy of and carry out all reasonable
instructions of the board of directors of the Corporation. The Consultant
acknowledges that such policies and instructions may limit, restrict or remove
any power or discretion which might otherwise have been exercised by the
Consultant.
<PAGE>
-2-
Remuneration. In consideration for the services rendered by the Consultant
hereunder, the Corporation shall pay to the Consultant consulting fees of two
thousand five hundred dollars ($2,500 US) per month.The Consulting fees shall be
paid on the last day of each month and the Corporation shall receive an invoice
from the Consultant prior to these dates.
Discretionary Bonus. A discretionary bonus payment shall be agreed to by the
Corporation and the Consultant no less than once per year and shall be paid by
the Corporation to the Consultant as additional consulting fees immediately
following their determination.
The Consultant shall be reimbursed from time to time for all out of pocket
expenses, including travel costs, actually and properly incurred by the
Consultant in connection with providing the Services hereunder. The Consultant
shall furnish statements and vouchers to the Corporation for all such expenses.
No Delegation of Services. The Consultant covenants and agrees with the
Corporation that it shall not delegate performance of the Services to anyone
without the prior written or verbal consent of the Corporation.
Provision of Amenities. The Corporation covenants and agrees with the Consultant
to provide, for the use of the Consultant, the following:
Office and Administrative Support - a reasonably furnished office,
administrative, and reception services at the offices of the Corporation.
The office shall have a minimum of three walls and include a computer
compliant to the Corporation system with provision for consistent software,
hardware, network, and utilities such as printer access (access to a color
capable printer is requested). A telephone system consistent with the
Corporation system and access to a facsimile machine will also be included.
Other Amenities - The Corporation agrees to provide, at no additional
charge to the Consultant, access to parking in the near vicinity of the
offices of the Corporation.
Confidential Information. The Consultant covenants and agrees that he shall not
disclose to anyone any confidential information with respect to the business or
affairs of the Corporation except as may be necessary or desirable to further
the business interests of the Corporation. This obligation shall survive the
expiry or termination of this Agreement.
Return of Property. Upon expiry or termination of this Agreement the Consultant
shall return to the Corporation any property, documentation, or confidential
information which is the property of the Corporation, unless it has previously
been agreed upon for other arrangements.
Promotion of Corporation's Interests. The Consultant shall and will faithfully
serve and use his best efforts to promote the interests of the corporation. The
Consultant shall not use any information he may acquire with respect to the
business and affairs of the Corporation or its affiliates for his own purposes
or for any purposes other than those of the Corporation or its affiliate
<PAGE>
-3-
Termination of Agreement. The Corporation may terminate this Agreement by giving
the Consultant thirty (30) days' written notice or in lieu of such written
notice by paying the Consultant a consulting fee equivalent to thirty (30) days
of consulting as determined pursuant to Section @.S hereof. The Consultant may
terminate this Agreement at any time by giving the Corporation thirty (30) days'
written notice. The obligations of the consultant under this Agreement shall
terminate upon the earlier of the Consultant ceasing to be retained by the
Corporation or the termination of this Agreement by the Corporation or the
Consultant.
Capacity of Consultant. It is acknowledged by the parties hereto that the
Consultant is being retained by the Corporation in the capacity of independent
contractor and not as an employee of the Corporation. The Consultant and
Corporation acknowledge and agree that this Agreement does not create a
partnership or joint venture between them.
Governing Law. The terms of this Agreement are governed by and construed in
accordance with the laws of the Province of British Columbia and the Federal
laws of Canada applicable therein and each of the parties hereto agrees
irrevocably to conform to the non-exclusive jurisdiction of the Courts of such
Province.
Notices. All notice, request, demands or other communications (collectively,
"Notices") by the terms hereof required or permitted to be given by one party
to any other party, or to any other person shall be given in writing by
personal delivery or by registered mail, postage prepaid, or by facsimile
transmission to such other party as follows:
a) To the Corporation at: attention: Emmanuel Aligizakis
Spectrum Ventures Ltd.
402-625 Howe Street
Vancouver, B.C. V6C 2T6
b) To the Consultant at: Emmanuel Aligizakis
509 Tempe Cres.
North Vancouver, B.C. V7N 1E7
or at such other address as may be given by such person to the other parties
hereto in writing from time to time.
All such Notices shall be deemed to have been received when delivered or
transmitted, or, if mailed, 48 hours after 1:01 a.m. on the day following the
day of the mailing thereof. If any Notice shall have been mailed and if regular
mail service shall be interrupted by strikes or other irregularities, such
Notice shall be deemed to have been received 18 hours after 12:01 a.m. on the
day day following the resumption of normal mail service, provided that during
the period that regular mail service shall be interrupted all Notices shall be
given by personal delivery or by facsimile transmission.
Language. The parties acknowledge that they have required this agreement to be
drawn in the English language.
Additional Conditions.'..,. The parties shall sign such further and other
documents, cause such meeting to be held, resolutions passed and by-laws
enacted, exercise their vote and influence, do and perform and cause to be done
and performed such further and other acts and things as may be necessary or
desirable in order to give full effect to this Agreement and every part thereof.
Counterparts. This agreement may be executed in several counterparts, each of
which so executed shall be deemed to be an original and such counterparts
together shall be but one and the same instrument.
<PAGE>
-4-
Severability. If any Article, Section or any portion of any Section of this
Agreement is determined to be unenforceable or invalid for any reason whatsoever
that unenforceability or invalidity shall not affect the enforceability or
validity of the remaining portions of this Agreement and such unenforceable or
invalid Article, Section or portion thereof shall be severed from the remainder
of this Agreement.
Time of the Essence. Time shall be of the essence of this Agreement and of every
part here of and no extension or variation of this Agreement shall operate as a
waiver of this provision.
Amendments. No modification, amendment or variation hereof shall be of effect or
binding upon the parties hereto unless agreed to in writing by each of them and
thereafter such modification, amendment or variation shall have the same effect
as if it had originally formed part of this Agreement.
Entire Agreement. This Agreement constitutes the entire Agreement between the
parties with respect to all of the matters herein and its execution has not been
induced by, nor do any of the parties rely upon or regard as material, any
representations or writings whatever not incorporated herein and made a part
hereof and may not be amended or modified in any respect except by written
instrument signed by the parties hereto. Any schedules referred to herein are
incorporated herein by reference and form part of the Agreement.
Enurement. This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective legal personal representatives, heirs,
executors administrators or successors.
Assignment. This Agreement is personal to the Consultant and may not be
assigned by the Consultant.
Currency. Unless otherwise provided for herein, all monetary amounts referred
to herein shall refer to the lawful money of Canada.
Transmission by Facsimile. The parties hereto agree that this Agreement may be
transmitted by facsimile or such similar device and that the reproduction of
signature by facsimile or such similar device will be treated as binding as if
originals and each party hereto undertakes to provide each and every other part
hereto with a copy of the Agreement bearing original signatures forthwith upon
demand.
<PAGE>
-5-
IN WITNESS WHEREOF the parties have duly executed this Consulting Agreement this
First day of September , 1998.
SIGNED,
SEALED AND DELIVERED
WITNESS Emmanuel Aligizakis
WITNESS Spectrum Ventures Ltd.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<CASH> $32,316
<SECURITIES> 0
<RECEIVABLES> 23,767
<ALLOWANCES> 0
<INVENTORY> 9,101
<CURRENT-ASSETS> 66,316
<PP&E> 1,860
<DEPRECIATION> 0
<TOTAL-ASSETS> 68,397
<CURRENT-LIABILITIES> 6,923
<BONDS> 0
0
0
<COMMON> 5,307,000
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 68,397
<SALES> 1,724
<TOTAL-REVENUES> (931)
<CGS> 2,655
<TOTAL-COSTS> 2,655
<OTHER-EXPENSES> 51,845
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (52,776)
<EPS-PRIMARY> (0.009)
<EPS-DILUTED> (0.009)
</TABLE>
