METALLURGICAL INDUSTRIES INC, 10KSB/A, 1996-01-08

METALLURGICAL INDUSTRIES INC
10KSB/A, 1996-01-08
MISCELLANEOUS PRIMARY METAL PRODUCTS

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-KSB/A

Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934
for the fiscal year ended December 31, 1994

Commission file number: Q-2549

BRIA COMMUNICATIONS CORP.
(Name of Small Business Issuer as stated in its Charter)

New Jersey 22-1644111
(State of Incorporation) (I.R.S. Employer I.D. No.)

268 West 400 South, Suite 300, Salt Lake City, Utah 84101
(Address of Principal Executive Offices) (Zip Code)

(801) 575-8073
(Issuer's Telephone Number)

Metallurgical Industries, Inc.
179 Avenue at the Common, Suite 2, Shrewsbury, New Jersey 07702
(Previous name and address of Issuer's principal executive offices,
if changed since the last report)

Securities registered under Section 12(b) of the Exchange Act: None

Securities registered under Section 12(g) of the Exchange Act:
Class A Common Stock, $0.001 Par Value

Check whether the issuer: (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.

Yes [ ] No [X]

Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]

The issuer's total revenues for the year ended December 31, 1994, were
$535,737.

The aggregate market value of the voting stock held by non-affiliates
computed by reference to the average bid and asked prices of such stock, as of
December 31, 1994, was $329,475 and as at November 15, 1995 was $3,498,413.

The number of shares outstanding of each of the issuer's classes of
common stock, as of December 31, 1994 and November 15, 1995, was as follows.
(The November 15, 1995, number of shares of Class A common stock reflects a 1-40
reverse stock split that occurred on February 1, 1995. See "Item 5 - Market for
Common Equity and Related Stockholder Matters.")
12/31/94 11/15/95
Class A Common Stock, (par value $0.001): 8,299,800 26,778,559

Class B Common Stock, (par value $0.001): 98,438.5 213,438.5

Transitional Small Business Format
Yes [ ] No [X]

<PAGE>

TABLE OF CONTENTS

PART I Page

ITEM 1. DESCRIPTION OF BUSINESS 4

ITEM 2. DESCRIPTION OF PROPERTY 6

ITEM 3. LEGAL PROCEEDINGS 7

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 9

PART II

ITEM 5. COMMON EQUITY AND RELATED STOCKHOLDER MATTERS 11

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS 12

ITEM 7. FINANCIAL STATEMENTS 19

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS 37

PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS AND CONTROL PERSONS 38

ITEM 10. EXECUTIVE COMPENSATION 39

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS 40

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 43

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K 47

<PAGE>

PART I

ITEM 1. DESCRIPTION OF BUSINESS

INTRODUCTION

The term the "Company" refers to Metallurgical Industries, Inc., now
known as BRIA Communications Corporation, a New Jersey corporation that is
hereafter referred to as the "Company." See "Item 4 - Submission of Matters to a
Vote of Security Holders" for a discussion on the Company's name change. The
Company's executive offices are located at 268 West 400 South, Suite 300, Salt
Lake City, Utah 84101.

BUSINESS DEVELOPMENT

The Company was incorporated in New Jersey in 1959. Until 1993, the
Company was engaged in the repair of aircraft turbine engine components and the
purchase, processing and selling of specialty refractory metals. In 1993,
competitive pressure from the aircraft turbine engine original equipment
manufacturers ("OEMs") forced the Company to discontinue operations in that
market. In addition, low levels of demand, surplus domestic capacity, and
increased competition from imports reduced the Company's profit margins in the
specialty refractory metals business to below the break-even level. As a result,
the Company began a downsizing process of its existing operations. In August
1993, the Company began to aggressively search for new opportunities or
replacements for its existing businesses.

In early 1994, the Company agreed to merge into MAXMusic, Inc., a
Delaware corporation ("MAX"). (See the Company's reports on Form 8-K filed on
March 11, 1994 and July 12, 1994.) The Company, pursuant to the Agreement and
Plan of Merger dated July 11, 1994 ("Merger Agreement"), began extensive
restructuring and reorganization. Upon the completion of merger and
recapitalization, the shareholders of MAXMusic, Inc. would have exchanged 100%
of their shares for a minimum of 80% of the Class A common stock of the Company.
However, MAX rescinded the merger on November 8, 1994, pursuant to the Merger
Agreement's provisions. See also "Item 6 - Management Discussion and Analysis"
for information regarding MAX and this rescission.

On March 18, 1994, a petition was filed in the U.S. Bankruptcy Court
against the Company requesting an order for relief under Chapter 7 of Bankruptcy
Code (case No: 94-31635). This involuntary bankruptcy petition was filed by
three of the Company's major creditors with claims totaling approximately
$147,000. MAXMusic agreed to purchase the debts of the three creditors and the
original petitioners stipulated to an extension of time to answer the petition
until June 1, 1994. This information was disclosed in Form 8-K Current Report
filed with SEC on April 11, 1994. On June 28, 1994, the Company reached a
settlement with the petitioning creditors and a payment was put in escrow to
settle the debt. On July 27, 1994, the U.S. Bankruptcy Court dismissed the
petition pursuant to 11 U.S.C. Section 303(j) of the United States Bankruptcy
Code.

<PAGE>

The Company ceased all active operations on June 30, 1994. Four
administrative employees remained on the payroll until September 30, 1994, to
facilitate the sale of the final Company assets in preparation for a planned
merger with MAXMusic, Inc. The four employees were terminated on September 30,
1994, after which the Company's officers, directors, and certain consultants
(see Item 6- Management Discussion and Analysis for a description of the
Company's major consultant, Canton Financial Services Corporation) sought to
merge with or acquire a viable entity.

In September 1994, the Company placed its two wholly owned
subsidiaries, Intermet Resources, Inc., and Advanced Welding and Coating
Services, Inc., into Chapter 7 bankruptcy, case numbers 94-36556 and 94-36561,
respectively. The decision to file for bankruptcy stemmed from the fact that
neither subsidiary was profitable or, in management's decision, had prospects of
becoming profitable. A trustee was appointed by the Court. At a hearing before
the U. S. Bankruptcy Court in Trenton, New Jersey, on December 7, 1994, the
Chapter 7 filings were accepted and the assets of both corporations were
liquidated. See also "Item 3 - Legal Proceedings" for information on these
bankruptcies.

In August 1994, the Company repaid its largest secured creditor,
Midlantic National Bank, in full. In September 1994, the Company settled with
another secured creditor, who was an officer and director of the Company, by
selling him the remaining equipment owned by the Company for $5,000. This
settled a debt totaling approximately $92,000 plus interest. The equipment had
not been sold by the Company after diligent efforts on its part for over a year.

On or about June 30, 1994, the Company's charter was involuntarily
dissolved by the State of New Jersey for failure to file its 1994 annual tax
return and remit the necessary fees due to preserve its status as a corporation
in good standing. The Company paid the State of New Jersey $5,652.66 to settle
all outstanding obligations on or about September 30, 1995. On November 29,
1995, the Company filed Form CBT-100 (corporate business tax return) with the
State of New Jersey. The Company received its Certificate of Reinstatement of a
Corporation in Good Standing on December 22, 1995, that was effective on
December 20, 1995.

BUSINESS OF ISSUER (Subsequent to December 31, 1994)

While the Company began searching for merger or acquisition candidates,
it became involved in the barter and trade industry. On March 1, 1995, the
Company appointed Richard Lifschutz ("Lifschutz") as the Company's president and
a director. See "Item 6 - Management's Discussion and Analysis, Change in
Corporate Management" for a discussion on the Company's change in management and
control. Lifschutz is very experienced in the barter industry and has been an
Itex broker for many years. (Itex is America's largest barter exchange.) Soon
after the arrival of Lifschutz, the Company began trading restricted shares of
its publicly traded Class A common stock for other tangible assets such as media
and trade credits. See "Item 6 - Management Discussion and Analysis" for a
discussion of the results of operations.

The Company entered into a Stock Exchange Agreement on December 8,
1995, by and between it and AltaChem Group, Inc., a corporation formed under the
laws of the Republic of Ireland ("AltaChem"). AltaChem is a chemical company
that manufactures, distributes, and sells chemicals used in the building
industry, including a polyurethane foam product used as insulation, sealants and
caulking materials. The Stock Exchange Agreement provides for the Company's
acquisition of 100% of the issued and outstanding capital stock of AltaChem in
exchange for 21,623,996 shares of the Company's Class A common stock, which
equaled 75% of the issued and outstanding shares of Class A common stock on
September 1, 1995, the date of stock issuance.

<PAGE>

The legal and beneficial shareholders of AltaChem's common stock "ACS,"
include James Tilton, the Company's current chief executive officer and one of
its directors, and ADS Group, Inc., a Belgian corporation whose majority
shareholder and president is Aster De Schrijver and whose chief executive
officer is James Tilton. Jane Zheng is the wife of James Tilton. See "Item 9
Directors, Executive Officers and Control Persons" and "Item 12 - Certain
Relationships and Related Transactions" for more information on Tilton, ADS
Group and De Schrijver. These shares were issued with the understanding that
they will be retired in the event the merger did not transpire. The net effect
of this stock exchange (which has been effected as a tax free reorganization
pursuant to Section 368(1)(b) of the Internal Revenue Code of 1986, as amended)
is that ACS owns a 75% interest in the Company and the Company owns 100% of
AltaChem.

To encourage AltaChem and ACS to enter into the Stock Exchange
Agreement, on August 3, 1995, the Company's board of directors unanimously
appointed James Tilton, Jane Zheng and Aster De Schrijver to serve as directors
of the Company. Upon the resignation of Richard D. Surber, on August 5, 1995,
from the position as a director of the Company and as its secretary/treasurer,
the board of directors appointed Ms. Zheng to serve as secretary/treasurer, and
also appointed Mr. Tilton as the chief executive officer of the Company. Mr.
Surber resigned for personal reasons and with no disagreements or disputes with
the Company or its management.

Since May 1995, the Company has been engaged in merger negotiations
with AltaChem Group, Inc., a corporation formed under the laws of the Republic
of Ireland ("AltaChem"). AltaChem is a chemical company that manufactures,
distributes, and sells chemicals used in the building industry, including a
polyurethane foam product used as insulation, sealants and caulking materials.
The document being discussed to formalize this merger is a Stock Exchange
Agreement that would provide for the Company's acquisition of 100% of the issued
and outstanding capital stock of AltaChem from the legal and beneficial owners
of AltaChem's common stock, which shareholders include Mr. James Tilton, ADS
Group, Inc., and indirectly Mr. Aster De Schrijver and shall hereinafter be
referred to as "ACS." In consideration for this proposed stock transfer, the
Company has issued 21,623,996 shares of its Class A common stock, which equaled
75% of the issued and outstanding shares of Class A common stock on September 1,
1995, the date of stock issuance. These shares were issued with the
understanding that they will be retired in the event the merger does not
transpire. The net effect of this stock exchange (which would be effected as a
tax free reorganization pursuant to Section 368(1)(b) of the Internal Revenue
Code of 1986, as amended) is that ACS would own a 75% interest in the Company
and the Company would own 100% of AltaChem.

ITEM 2. DESCRIPTION OF PROPERTY

The Company's principal offices are located at 268 West 400 South,
Suite 300, Salt Lake City, Utah 84101. The Company receives office space,
accounting, secretarial services and office supplies from Canton Financial
Services Corporation, a Nevada corporation ("CFSC"), pursuant to a Consulting
Agreement dated May 16, 1995. According to the agreement, the Company pays CFSC
with shares of the Company's Class A common stock. For another discussion on
this Consulting Agreement, see "Item 6 - Management Discussion and Analysis" and
"Item 12 Certain Relationships and Related Transactions." The Company expects to
relocate its offices upon a successful merger or acquisition.

<PAGE>

ITEM 3. LEGAL PROCEEDINGS

The following discussion describes all material pending legal
proceedings involving the Company.

In September 1994, the Company placed its two wholly-owned
subsidiaries, Intermet Resources, Inc., and Advanced Welding and Coating
Services, Inc., into Chapter 7 bankruptcy, case numbers 94-36556 and 94-36561,
respectively. The decision to file for bankruptcy stemmed from the fact that
neither subsidiary was profitable or, in then-management's decision, had
prospects of becoming profitable. A trustee was appointed by the Court. At a
hearing before the U. S. Bankruptcy Court in Trenton, New Jersey, on December 7,
1994, the Chapter 7 filings were accepted and the assets of both corporations
were liquidated. See "Item 1 - Description of Business" for additional
information on these subsidiaries.

On March 18, 1994, a petition was filed in the U.S. Bankruptcy Court
against the Company requesting an order for relief under Chapter 7 of Bankruptcy
Code (case No: 94-31635). This involuntary bankruptcy petition was filed by
three of the Company's major creditors with claims totaling approximately
$147,000. MAXMusic agreed to purchase the debts of the three creditors and the
original petitioners stipulated to an extension of time to answer the petition
until June 1, 1994. This information was disclosed in a Form 8-KSB filed with
SEC on April 11, 1994. On Jun 28, 1994, the Company reached a settlement with
the petitioning creditors and a payment was put in escrow to settle the debt. On
July 27, 1994, the U.S. Bankruptcy Court dismissed the petition pursuant to 11
U.S.C. Section 303(j) of the United States Bankruptcy Code.

Between November 1986 and March 1994, the Company leased office and
plant site at 1 Coldstream Way, Tinton Falls, New Jersey from Mid-Monmouth
Realty Association, whose principal offices are at 75 Eisenhower Parkway,
Roseland, New Jersey. The Environmental Cleanup and Responsibility Act ("ECRA")
of New Jersey imposed a number of obligations on the Company; however, since the
Company does not own its facility in Tinton Falls, the obligations are jointly
and severally the obligations of the Company and Landlord. On November 29, 1995,
the New Jersey Department of Environmental Protection and Energy (NJDEPE)
completed a review of this site with the cooperation of Company's former
landlord. NJDEPE requested that the Company/landlord do further sampling on
various portions of the site, such as the storage and waste tanks, the former
settling pond, pipe discharges, below-ground-surface soil and groundwater. The
Company/landlord is also required to submit a revised Remedial Action Schedule
and summarized analytical results on the samplings.

<PAGE>

The Company and the Landlord entered into a lease modification in
October 1993 under which, among other things, the landlord agreed to perform
whatever environmental study and remediation would be required to satisfy the
NJDEPE. The Company agreed to reimburse the landlord for the costs associated
with this, all of which is secured. The first $100,000 is secured and
subordinate only to the secured interest of Midlantic National Bank, taxes owed
to Internal Revenue Services, and State of New Jersey taxes. Any liability in
excess of $100,000 is secured but subordinate to security interest of the same
entities plus that of Ira Friedman and Lawrence Friedman. As of November 15,
1995, the landlord has not advised the Company of the cost it has incurred and
has not disclosed to the Company the results of the studies and tests it has
conducted. The company had insurance policies with Greater New York Mutual
Insurance Company which the Company believes should cover approximately $100,000
of the cleanup costs. Although the insurance company has indicated that it would
decline coverage, in the opinion of the Company's special insurance counsel and
with the support of New Jersey case law, the Company believes that it has
insurance coverage for the first $100,000 incurred in remediating the Tinton
Falls plant site. However, no assurance can be given that Greater New York
Mutual Insurance Company will cover any costs incurred at this site.

The Company brought suit in New Jersey Superior Court in September 1991
against Lawrence S. Lorman, the former Executive Vice President and Chief
Financial Officer of the Company, alleging breach of his employment contract
dated June 13, 1990. Mr. Lorman countersued in New Jersey Superior Court against
the Company and Messrs. Ira Friedman, Lawrence Friedman, and Ross Radtke
alleging breach of his employment contract. In August 1994, the countersuit
filed by Lawrence Lorman was dismissed without prejudice by the New Jersey
Superior Court. Mr. Lorman agreed to pay the legal expenses that the Company
incurred in the suit against him (approximately $6,000) and the lawsuit was
dropped.

On August 3, 1993, Praxair Inc., filed a lawsuit against the Company
for the amount of $9,858. The suit was filed with the Union County Superior
Court, docket number is 004773-93, and was dismissed with prejudice by the
court.

North Tool and Manufacturing Company filed a lawsuit against the
Company on August 5, 1993, in Monmouth County Small Claims Court, docket number
93007704, seeking $4,285 in past due bills. A judgment for the amount of $4,285
has been issued against the company and remains unsatisfied; however, the amount
has been accrued on the Company's financial statements for the year ended
December 31, 1994.

Globe Petroleum Inc. filed a lawsuit against the Company on August 17,
1993, in Monmouth County Small Claims Court, docket number 93003632, for the
amount of $1,183. The Company believes that the suit, if the plaintiff were to
prevail, will have no material impact on the Company's financial position due to
the nominal dollar amount involved; however, no such assurances can be given.

On August 18, 1993, Spragues Oil Services Inc. filed a lawsuit against
the Company in Monmouth County Small Claims Court, docket numbers 93003700 for
the amount of $1,075. A judgment for the amount of $1,075 has been issued
against the company and is yet to be satisfied. The Company has accrued this
amount on its 1994 financial statements.
<PAGE>

Jersey Printing Associates Inc. filed a lawsuit against the Company
seeking $871 on August 30, 1993, in Monmouth County Small Claims Court, docket
number 93008510. A judgment for the amount of $269 was sought against the
Company and remains unsatisfied. $269 has been recorded on the Company's 1994
financial statements.

On September 20, 1993, Monmouth Building Center Inc. filed a lawsuit
against the Company in Monmouth County Small Claims Court, docket number
93004174, seeking $926. This case is still pending. The Company believes that
the suit, if the plaintiff were to prevail, will have no material impact on the
Company's financial position due to the nominal dollar amount involved; although
no such assurances can be given.

Budget Rent-A-Car Inc. received an unsatisfied judgment against the
Company in the amount of $3,826 as a result of the lawsuit it filed against the
Company on January 11, 1994, in Monmouth County Small Claims Court, docket
number SC-00000367-94DC. Damages of $3,734 were sought and have been recorded on
the Company's financial statements for the year ended December 31, 1994.

Eaton Financial Corporation filed a lawsuit against the Company on
August 22, 1994, in Monmouth County Superior Court, docket number SL-004706-94,
seeking $27,159. The suit was dismissed with prejudice by the court.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The Company did not submit any matters to a vote of security holders
during the fourth quarter of the fiscal year 1994.

SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS AFTER DECEMBER 31, 1994.

On February 17, 1995, the Company mailed all of its shareholders a
notice of a special meeting to be held on March 14, 1995 and asked them to
consider and vote upon the following matters:

1. PROPOSAL NO. 1 - amend the Company's Articles of Incorporation to
increase the number of the Company's authorized shares of Class A
common stock to two hundred million (200,000,000) and Class B common
stock to two hundred and twenty thousand (220,000);

2. PROPOSAL NO. 2 - amend the Company's Certificate of Incorporation
to reduce the par value per share of Class A and Class B Common
Stock of the Company from $0.10 to $0.001;

3. PROPOSAL NO. 3 - amend the Company's Certificate of Incorporation to
permit amendments to the Company's Certificate of Incorporation by a
majority vote of the Company's shareholders;

4. PROPOSAL NO. 4 - ratify the appointment of Michael L. Roper, CPA, as
the Company's independent auditor for the fiscal year ending December
31, 1994;

5. PROPOSAL NO. 5 - amend the Company's Certificate of Incorporation
to change the Company's name to BRIA Communications Corp;
<PAGE>

6. PROPOSAL NO. 6 - transact such other business as may properly come
before the Special Meeting or any adjournment thereof.

Included with the notice of meeting was a proxy statement furnished in
connection with the solicitation of proxies by the Board to be voted at the
special meeting. Due to an inability to form a proper quorum on March 14, 1995,
the meeting was adjourned to March 21, 1995. As of March 21, 1995, the total
number of shares eligible to vote was approximately 306,516, of which 153,258
(or at least 50%) was required to constitute a quorum. The number of shares
represented at the meeting was 157,544 (or 51%).

The Board of Directors removed Proposal 4 from the agenda of the
Special Meeting because it had decided against engaging Michael L. Roper, CPA,
as its independent auditor for the fiscal year ending December 31, 1994.

This March 14, 1995, Special Meeting was called by the Board of
Directors to effectuate changes management deemed necessary for the Company's
survival. All of the Board of Directors and the owners of at least two-thirds of
the shares voted at the meeting, by actual votes or written consent thereto, and
approved the following proposals: to increase the number of authorized shares of
the Company to two hundred million shares of Class A common stock and two
hundred twenty thousand shares of Class B common stock, par value $0.10; to
amend the Company's Certificate of Incorporation to reduce the par value per
share of Class A and Class B Common Stock of the Company from $0.10 to $0.001;
to amend the Company's Certificate of Incorporation to permit amendments to the
Company's Certificate of Incorporation to be effected by a majority of
shareholders; and to change the company's name to BRIA Communications Corp.,
effective April 1, 1995. Now that the Company is in good standing with the State
of New Jersey, it is in the process of filing a Certificate of Amendment to the
Certificate of Incorporation that sets forth these changes with the State of New
Jersey. See "Item 1 - Description of Business" for an additional discussion on
the Company's corporate status in New Jersey.
<TABLE>

PROPOSALS(1)(2) Number of Shares That Number of Shares That Number of Abstentions
Voted For Proposal Voted Against Proposal Shares Not
Represented1
<S> <C> <C> <C> <C>
Proposal No. 1 143,832 13,712 148,971.5 Not Applicable

Proposal No. 2 143,672 13,872 148,971.5 Not Applicable

Proposal No. 3 143,999 13,545 148,971.5 Not Applicable

Proposal No. 5 145,147 12,397 148,971.5 Not Applicable
</TABLE>

(1) Proposals 1,2,3 and 5 involved an amendment to the Company's articles of
incorporation and therefore required two-thirds majority vote (or 105,029 voting
shares) of the quorum represented at the meeting to pass and thus be approved.

(2) Proposal 4 was withdrawn at the discretion of the board of directors because
it decided against engaging Michael L. Roper, CPA, as its independent auditor
for the fiscal year ending December 31, 1994. See "Item 8 Changes in and
Disagreements with Accountants on Accounting and Financial Disclosure" for a
discussion on the Company's past and present independent auditors.

[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]

<PAGE>

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The following table sets forth the prices of the Company's Class A
common stock in the over-the-counter market for each quarter during fiscal years
1993 and 1994 and the first three quarters of fiscal year 1995. The National
Association of Securities Dealer, Inc. was the source of the information for
these prices. These over-the-counter market quotations are based on inter-dealer
bid prices, without markup, markdown, or commission, and may not necessarily
represent actual transactions.

BID QUOTATION

Fiscal Year 1993 High ($) Low ($)
Quarter ended 03/31/93 3.75 1.25
Quarter ended 06/30/93 1.50 0.50
Quarter ended 09/30/93 1.25 0.03
Quarter ended 12/31/93 0.63 0.09

Fiscal Year 1994
Quarter ended 03/31/94 1.19 0.16
Quarter ended 06/30/94 0.69 0.28
Quarter ended 09/30/94 0.34 0.25
Quarter ended 12/31/94 0.28 0.03

Fiscal Year 1995
Quarter ended 03/31/95 1.87* 1.25*
Quarter ended 06/30/95 1.25* 0.50*
Quarter ended 09/30/95 1.50* 0.50*

* These quotes reflect the 1-for-40 Reverse Stock Split of the Company's Class A
common stock effective February 1, 1995.

On February 1, 1995, the Board of Directors unanimously approved a
1-for-40 reverse stock split of the Class A Common Stock (the "Reverse Stock
Split"). The bid price of the Class A common stock before the Reverse Stock
Split was $1/32, roughly three cents per share whereas after the Reverse Stock
Split, on February 6, 1995, the bid price was $1.13. Simultaneous with the
Reverse Stock Split, the Board of Directors decreased the authorized number of
shares to assure that the rights and preferences of the holders of outstanding
shares of Class A Common Stock were not adversely affected by the reverse split.
The percentage of authorized shares of Class A Common Stock that remained
unissued after the Reverse Stock Split did not significantly exceed the
percentage of authorized shares of Class A Common Stock that was unissued before
the Reverse Stock Split. Pursuant to the Reverse Stock Split, the authorized
number of shares of Class A Common Stock decreased from 10,000,000 to 250,000,
although the total capitalization of the Company and the intrinsic value of each
shareholders' investment did not change significantly when the Reverse Stock
Split took effect. The authorized number of shares of Class A stock was later
raised to 200,000,000 at the March 21, 1995, special shareholders' meeting. See
"Item 4 - Submission of Matters to a Vote of Security Holders" for additional
information on the special meeting.
<PAGE>

STOCKHOLDERS

The approximate number of stockholders (of record) of Class A common
stock was 500 on December 31, 1994, holding 8,299,800 shares. As of November 15,
1995, there were approximately 694 shareholders of record holding approximately
26,778,559 shares of the Company's Class A common stock, which takes the
February 1, 1995, reverse stock split (as discussed above) into account. The
Class B common stock was held by only one stockholder of record as of December
31, 1994, who owned 98,438.5 shares. On November 15, 1995, there were two
stockholders of record owning 213,438.5 shares of the Company's Class B common
stock.

DIVIDENDS

Due to its limited cash flow, the Company has not declared a cash
dividend for the past two fiscal years on either the Class A Common Stock or the
Class B Common Stock and does not anticipate doing so in the near future.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION AND PLAN OF OPERATION

COMPARISON OF FISCAL 1994 AND FISCAL 1993

During June 1994, the Company ceased all active operations. This
cessation significantly affected the Company's performance for fiscal 1994
relative to fiscal 1993.

DISCUSSION OF OPERATIONS

The Company ceased all active operations on June 30, 1994. Four
administrative employees remained on the payroll until September 30, 1994 in
order to facilitate the sale of the final Company assets in preparation for a
proposed merger with MAXMusic, Inc. The services of the four employees were
terminated on September 30, 1994.

On February 14, 1994, the Company signed a Binding Letter of Intent
with MAXMusic, Inc., a Delaware corporation located in Denver, Colorado ("MAX").
The Letter of Intent called for recapitalization of the Company and a subsequent
merger between MAX and the Company. This information was disclosed in a Form 8-K
filed with the Commission on March 11, 1994. On July 11, 1994, MAX and the
Company signed a Definitive Merger Agreement. A current report on Form 8-K and a
press release regarding this definitive agreement were issued on July 12, 1994.
<PAGE>

The Company was advised on November 8, 1994, that MAX was exercising
its option to rescind the Definitive Merger Agreement pursuant to the terms of
the Definitive Merger Agreement. MAX had signed promissory notes totaling over
$776,000 plus accrued interest, that were due on July 31, 1994. These notes
would have been eliminated as part of the merger, however, since the merger was
cancelled, $287,000 worth of the notes, including interest, became immediately
due with the remaining $489,250 worth of notes, plus accrued interest, becoming
due over a twelve month period.

MAX filed Chapter 7 bankruptcy on March 3, 1995, claiming that no
assets were available for bankruptcy liquidation to unsecured creditors such as
the Company. The Company does not expect to receive any portion of the $776,000
worth of promissory notes and will not unless MAX's bankruptcy trustee declares
that assets are available to MAX's unsecured creditors. As of November 15, 1995,
no such declaration had been made and the Company does not expect such a
statement to be made in the future. The Company is currently in negotiations to
settle this matter although no assurances can be given that this will in fact
occur. See "Item 1 - Description of Business" for an additional discussion on
this rescinded merger.

In September 1994, the Company placed its two wholly-owned
subsidiaries, Intermet Resources, Inc., and Advanced Welding and Coating
Services, Inc. ("AWACS"), into Chapter 7 bankruptcy, case numbers 94-36556 and
94-36561, respectively. The decision to file for bankruptcy stemmed from the
fact that neither subsidiary was profitable or, in then-management's decision,
had prospects of becoming profitable. A trustee was appointed by the Court. At a
hearing before the U. S. Bankruptcy Court in Trenton, New Jersey, on December 7,
1994, the Chapter 7 filings were accepted and the assets of both corporations
were liquidated.

Control of the Company shifted to Richard D. Surber in December 1994,
pursuant to a Settlement Agreement dated December 16, 1994, by and among the
Company, Ira L. Friedman, formerly the president, chief executive officer and a
director of the Company ("Friedman"), Richard T. Johnson, formerly the chief
financial officer, vice president of finance and a director of the Company
("Johnson"), The Canton Industrial Corporation, a Nevada corporation ("Canton"),
and A-Z Professional Consultants, Inc., a Utah corporation ("A-Z") (the
"Settlement Agreement"). The Settlement Agreement resolved disputes over
agreements that involved consulting arrangements and organizational
consolidations among the Company, Canton and A-Z, many of which were never
consummated. Richard D. Surber, a director and the chief executive officer of
Canton, is the president and sole director of A-Z. Mr. Surber's control arose
from his appointment as the Company's president and a director, and his indirect
beneficial ownership of voting securities. The basis of Mr. Surber's control is
described below. Canton and A-Z may be deemed affiliates by virtue of being
under common control. See "Item 1 - Description of Business and Item 6
Management Discussion and Analysis, Changes in Corporate Management" for
additional information on this settlement and the change in control of the
Company.

In consideration for the release by Canton and A-Z of the Company,
Friedman and Johnson from any and all claims, causes of action, and obligations
relating to the agreements, Friedman and Johnson appointed Richard D. Surber as
president and director of the Company and agreed to appoint two other persons to
the Company's board that Canton would nominate. Canton nominated Bobby G. Welch,
II and Christopher Swaner as directors of the Company and both were in fact
appointed. The Settlement Agreement also called for Friedman and Johnson to
resign from their positions and request that the Company's other officers and
directors also resign. Effective December 16, 1994, the Company's officers along
with directors Keith R. Garrity and Edward Mentzer resigned. The board of
directors appointed Mr. Surber to fill Mr. Garrity's term as a director.
Effective December 17, 1994, Friedman, Johnson and Lawrence S. Friedman resigned
from the board of directors, leaving Mr. Surber as the Company's sole director,
until the appointments of Mr. Welch and Mr. Swaner in January 1995. See "Item 6
- - Management Discussion and Analysis, Changes in Corporate Management" for
additional information on the change in control of the Company.
<PAGE>

In addition, as payment for services rendered prior to 1995, the
Company agreed to issue Friedman, Johnson, and Lawrence Friedman 10% of the then
issued and outstanding Class A Common Stock on March 24, 1995 after any reverse
stock split excluding any shares owned by Friedman, Johnson, and Lawrence
Friedman. The shares were issued on April 1, 1995 when the number of issued and
outstanding Class A Common Stock was 1,860,080 (excluding shares owned by the
three former officers and directors). The Company issued such shares as follows:
4.9% to Friedman, 4.9% to Johnson, and 0.2% to Lawrence Friedman. Consequently,
Friedman and Johnson each received 91,144 shares and Lawrence Friedman received
3,720 shares.

Immediately after Mr. Surber's December 16, 1994 appointment as
president and a director of the Company, the principal offices of the Company
moved from Tinton Falls, New Jersey, to 268 West 400 South, Suite 300, Salt Lake
City, Utah. The services of Canton Financial Services Corporation, a Nevada
corporation and wholly owned subsidiary of Canton ("CFSC"), were initially
retained pursuant to the Settlement Agreement and later pursuant to a Consulting
Agreement dated May 16, 1995. The Settlement Agreement stipulated Canton's
initial compensation at 1,612,000 restricted shares of the Company's Class A
common stock for services relating to the completion of the Company's proxy
statement. See "Item 4 - Submission of Matters to a Vote of Security Holders"
for more information on this proxy statement. After the relocation of corporate
offices, the Company became largely dependent on CFSC's services. Pursuant to
the Consulting Agreement, which was retroactively effective on February 18,
1995, CFSC has continued to provide a variety of consulting services and
administrative tasks in exchange for a monthly fee based on the rates at which
the services of CFSC's employees are billed that is payable in the restricted
shares of the Company's Class A common stock. The Consulting Agreement's term is
one year; however, it is terminable with 30 days notice and it can be extended
on a monthly basis. CFSC has provided the Company with office space as well as
internal record keeping, the preparation of reports required to be filed with
Securities and Exchange Commission ("SEC"), the negotiation of settlement of the
Company's debts, and the search for a viable merger or acquisition candidate.
The Company was acquainted with AltaChem through CFSC's efforts.

DISCUSSION OF OPERATIONS (Since December 31, 1994)

On February 1, 1995, the Board of Directors unanimously approved a
1-for-40 reverse stock split of the Class A Common Stock (the "Reverse Stock
Split"). The bid price of the Class A common stock before the Reverse Stock
Split was $1/32, roughly three cents per share whereas after the Reverse Stock
Split, on February 6, 1995, the bid price was $1.13. Simultaneous with the
Reverse Stock Split, the Board of Directors decreased the authorized number of
shares to assure that the rights of the holders of outstanding shares of Class A
Common Stock were not adversely affected by the reverse split. The percentage of
authorized shares of Class A Common Stock that remained unissued after the
Reverse Stock Split did not significantly exceed the percentage of authorized
shares of Class A Common Stock that was unissued before the Reverse Stock Split.
Pursuant to the Reverse Stock Split, the authorized number of shares of Class A
Common Stock decreased from 10,000,000 to 250,000, although the total
capitalization of the Company and the intrinsic value of each shareholders'
investment did not change significantly when the Reverse Stock Split took
effect. See "Item 5 - Market for Registrant's Common Equity and Related
Stockholder Matters" for an additional discussion on this stock split.
<PAGE>

A Special Meeting of Shareholders of the Company was scheduled for
March 14, 1995; however, because of the lack of a quorum, it was adjourned to
and completed on March 21, 1995 (the "Meeting"). The Meeting was called by the
board of directors to effectuate changes it deemed necessary for the Company's
survival. All of the directors and the owners of at least two-thirds of the
shares voted at the Meeting, by actual votes or written consent thereto, and
approved the following proposals: to increase the number of authorized shares of
the Company to two hundred million shares of Class A common stock and two
hundred twenty thousand shares of Class B common stock, par value $0.10; to
amend the Company's Certificate of Incorporation to reduce the par value per
share of Class A and Class B Common Stock of the Company from $0.10 to $0.001;
to amend the Company's Certificate of Incorporation to permit amendments to the
Company's Certificate of Incorporation to be effected by a majority of
shareholders; and to change the company's name to BRIA Communications Corp.,
effective April 1, 1995. A Certificate of Amendment to the Certificate of
Incorporation was filed with the Secretary of State of New Jersey on December
20, 1995, which sets forth these changes. See "Item 1 - Description of Business"
for an additional discussion on the Company's corporate status in New Jersey and
see "Item 4 - Submission of Matters to a Vote of Security Holders" for
additional information regarding the special meeting of shareholders.

One of the more important results of the Meeting was to increase the
amount of authorized but unissued shares of common stock. When combined with the
heightened attraction of the Class A common stock due to its increased price,
which stemmed from the Reverse Stock Split, this increase in authorized shares
has made it possible for the Company to issue shares of its common stock to
settle a portion of its debts as well as to trade and barter for other assets.
See immediately below for additional information on the Company's acquisition of
other assets and settlement of debts.

Through the efforts of CFSC, in the Spring of 1995 the Company was able
to settle debts with 16 of the Company's creditors. The terms typically offered
by the Company to its creditors involve the issuance of restricted shares of
common stock in the Company equal to 10% of the amount of each debt in exchange
for the creditors' complete discharge of such liabilities. The Company issued
158,166 restricted shares of the Class A common stock in exchange for the
written discharge of $233,726 in debt. This debt settlement campaign reduced the
Company's accounts payable from over $900,000 on December 31, 1994, to less than
$700,000 on September 30, 1995. Although the Company is still attempting to
settle its existing liabilities, no assurances can be given that any additional
debts will be settled for a number of shares of common stock acceptable to the
Company.

While the Company began searching for merger or acquisition candidates,
it became involved in the barter and trade industry. On March 1, 1995, the
Company appointed Richard Lifschutz ("Lifschutz") as the Company's president and
a director. Lifschutz is very experienced in the barter industry and has been an
Itex broker for many years. (Itex is America's largest barter exchange.) Soon
after the arrival of Lifschutz, the Company began trading its publicly-traded
Class A common stock for other tangible assets such as media and trade credits,
including the following:
<PAGE>

- the purchase of $500,000 worth of media credits on July 31,
1995, from Associated Reciprocal Traders ("ART"), a British Virgin
Island corporation, in exchange for 500,000 restricted shares of
the Company's Class A common stock.

- the sale of 200,000 shares of its Class A restricted common
stock, effective July 11, 1995, to Itex Corporation, a Nevada
corporation, in exchange for 100,000 ITEX Trade Dollars which can
be used on the Itex Barter Exchange to acquire a variety of goods
and services.

On March 1, 1995, the Company entered into two Consulting Agreements,
one with Karston Electronics, Ltd., a corporation formed under the laws of the
British Virgin Islands ("Karston"), and the other with East-West Trading Corp.,
a corporation formed under the laws of the West Indies ("East-West"). The
Company retained East-West and Karston to assist the Company in general business
consulting. As compensation for these services, the Company issued to Karston
and East-West each 120,000 shares of its Class A common stock pursuant to
Regulation S of the Securities Act of 1933. The Company also granted both
Karston and East-West options to purchase up to 250,000 shares of the Company's
common stock at an exercise price of $0.50 per shares to be exercised no later
than August 4, 1996.

Pursuant to a Letter Agreement dated July 7, 1995 and its Addendum
dated July 11, 1995, the parties to the December 16, 1994 Settlement Agreement
modified certain terms of Settlement Agreement to include, among other terms,
the issuance of certain shares of the Company's common stock to Friedman and
Johnson. Ira Friedman was issued 85,800 shares, which include 55,800 shares for
services rendered prior to 1995 and 30,000 shares for the services that Material
Technology, Inc., rendered in 1995, over which Ira Friedman shares control with
Richard Johnson. The Company also issued 79,200 shares to Richard Johnson,
including 55,800 shares for services rendered prior to 1995 and 23,400 shares
for services that Material Technology, Inc. provided during 1995, over which
Richard Johnson shares control with Ira Friedman. In addition, the Company
issued 20,000 shares to Ira Friedman and Richard Johnson, jointly, for their
March 1995 payment of $12,537 to the IRS for payroll taxes. The Company also
agreed to use its best efforts to register said shares (as well as all shares
issued to Friedman, Lawrence Friedman and Johnson pursuant to paragraph 1(b)(v)
of the Settlement Agreement) on an available registration statement format,
which may include Form S-8, as soon as it is feasible for the Company to so
undertake.

The legal and beneficial shareholders, who is also one of the Company's
directors, of AltaChem's common stock "ACS," include James Tilton, the Company's
current chief executive officer and one of its directors, and ADS Group, Inc., a
Belgian corporation. ADS Croup's majority shareholder and president is Aster De
Schrijver, who is also one of the Company's directors, and its chief executive
officer is James Tilton. Jane Zheng is the wife of James Tilton and one of the
Company's directors. See "Item 9 Directors, Executive Officers and Control
Persons" and "Item 12 - Certain Relationships and Related Transactions" for more
information on Tilton, Zheng, ADS Group and De Schrijver. These shares were
issued with the understanding that they would be retired in the event the merger
did not transpire. The net effect of this stock exchange (which has been
effected as a tax free reorganization pursuant to Section 368(1)(b) of the
Internal Revenue Code of 1986, as amended) is that ACS acquired a 75% interest
in the Company and the Company acquired 100% of AltaChem.

<PAGE>

On September 28, 1995, Tianrong Building Material Holding, Ltd., of
which James Tilton is the President and a director, purchased 40,000 shares of
the Company's Class A Common Stock at $0.25 per share. The Company has received
the payment of $10,000. See "Item 9 - Directors, Executive Officers and Control
Persons" and "Item 12 - Certain Relationships and Related Transactions" for more
information on James Tilton and his relationship with ACS and AltaChem.

CHANGES IN CORPORATE MANAGEMENT

As discussed in the preceding paragraphs of this Item 6, the Company
experienced a change in management on December 16, 1994, when the Company's
officers and directors resigned and appointed Richard Surber as the Company's
president and a director. On January 15 and 16, 1995, Bobby G. Welch II and
Christopher Swaner were respectively appointed as a director of the Company.

CHANGES IN CORPORATE MANAGEMENT (Subsequent to December 31, 1994)

On March 1, 1995, Richard Surber resigned as president of the Company.
The board of directors accepted this resignation and appointed him as the
Company's Secretary/Treasurer and appointed Richard Lifschutz ("Lifschutz") as
the President and a director of the Company. See "Item 1 - Description of
Business" and "Item 6 - Management Discussion and Analysis - Discussion of
Operations" for additional information on Lifschutz's appointment.

For personal reasons and with no complaints, disagreements or disputes
with the Company or its management in any respect, Mr. Welch resigned as
director on March 3, 1995. Mr. Swaner resigned due to personal reasons and not
because of any disagreements or disputes with the Company or its management in
any respect, on March 30, 1995. Mark Knudson ("Knudson") was appointed as a
director of the Company on March 30, 1995, to fill the vacancy created by
Christopher Swaner's resignation. Mr. Knudson subsequently resigned on July 31,
1995 without any disagreements with the Company.

To encourage AltaChem and ACS to enter into the Stock Exchange
Agreement, on August 3, 1995, the Company's board of directors unanimously
appointed James Tilton, Jane Zheng and Aster De Schrijver to serve as directors
of the Company. See "Item 1 - Description of Business" and the preceding
paragraphs of this item for additional information regarding this merger. James
Tilton and Aster De Schrijver are officers and directors of AltaChem, and, aside
from these positions, are the beneficial owners, directly or indirectly, of 100%
of AltaChem's common stock. Jane Zheng is the wife of James Tilton. See "Item 11
- - Security Ownership of Certain Beneficial Owners and Management" and "Item 12
Certain Relationships and Related Transactions" for more information on James
Tilton, Jane Zheng and Aster De Schrijver. Upon the resignation of Richard D.
Surber, on August 5, 1995, from the position as a director of the Company and as
its secretary/treasurer, the board of directors appointed Ms. Zheng to serve as
Secretary/Treasurer, and also appointed Mr. Tilton as the chief executive
officer of the Company. Mr. Surber resigned for personal reasons and with no
disagreements or disputes with the Company or its management. For more
information on these officers and directors, please see "Item 9 Directors,
Executive Officers, Promoters and Control Persons; Compliance with Section 16(a)
of the Exchange Act."
<PAGE>

The Company is not aware of any arrangements that may result in a
change in control of the Company in the future.

Results of Operations

Revenues for 1994 were $535,737 compared to $2,758,018 for 1993, a
decrease of $2,222,281, or 81%. The sharp decline is due to the fact that the
Company ceased all active operations on or about June 1994. During 1994, the
Company generated $327,734 from Refractory Metals Division (RMD), $163,371 from
Intermet Resources Inc., and $44,632 from miscellaneous sales. See "Item 1
Description of Business, Business of Issuer" or "Item 6 - Management Discussion
and Analysis" for additional information on these subsidiaries.

Costs of sales decreased from $3,442,695 in 1993 to $559,828 in 1994.
Costs of sales as a percentage of Revenue was 104% for 1994 compared to 125% for
1993. The higher level in 1993 was attributable to reduced level of demand,
surplus domestic capacity, growing level of imports, and acquisition of several
major customers by competitors. The percentage improved in 1994 due to the
cessation of two subsidiaries' operations, AWACS and RMD, which had historically
been low-margin businesses.

Selling, general and administrative expenses for 1994 decreased to
$1,043,582 from $1,765,797 for 1993. The decrease was due to the reduction in
staff and the lower level of activity resulting from the asset liquidation
process.

Interest expense decreased to $31,440 from $102,422 in 1993. The
decline was due to the reduction in principal owed to Midlantic National Bank
(MNB), a secured creditor. In August 1994, the Company repaid the debt owed to
MNB in full.

Loss before extraordinary items as a percentage of sales was 205% for
1994 and 93% for 1993. The actual loss before extraordinary items was $1,099,113
for 1994 compared to 2,552,896 to 1993.

The Company sustained a loss $97,503 from disposition of assets in 1994
compared to $0 for 1993. During 1994, the Company wound up its businesses and
many assets were liquidated at prices significantly below the original costs.

The Company incurred a net loss of $1,135,434 for 1994 as compared to a
net loss of $2,552,896 for 1993. The substantial loss for these years was mainly
attributable to losses sustained as a result of the Company's liquidation of
operations.
<PAGE>

Capital Resources and Liquidity

During 1994 and 1995, the Company settled a portion of its existing
liabilities and issued stock as a means to pay its creditors as well as
consultants and other professionals for various services rendered.

The deficiency in working capital of the Company increased from
$1,131,086 in 1993 to $1,243,431 in 1994 as a result of the liquidation of fixed
assets at prices substantially below the cost.

Net stockholders' deficit in the Company was $1,201,718 in 1994, as
compared to $750,193 in 1993. The decline is primarily attributable to operating
losses and loss on disposition of assets sustained in 1994.

ITEM 7. FINANCIAL STATEMENTS

Please see Pages F-1 through F-17 for the financial statements the
Company is required to file in this report.

[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]

<PAGE>

ITEM 7. FINANCIAL STATEMENTS

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Independent Auditor's Report.................................................F-2

Independent Auditor's Report.................................................F-3

Consolidated Balance Sheets..................................................F-4

Consolidated Statements of Operations........................................F-5

Statements of Consolidated Stockholders Equity...............................F-6

Statements of Consolidated Cash Flows........................................F-7

Notes to Consolidated Financial Statements...................................F-8

F-1
<PAGE>
ANDERSON, ANDERSON & STRONG, L.C.
Certified Public Accountants & Business Consultants
941 East 3300 South, Suite 202
Salt Lake City, Utah 84106

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

The Board of Directors and Stockholders of
Metallurgical Industries, Inc.

We have audited the consolidated balance sheet of Metallurgical Industries, Inc.
and subsidiaries as of December 31, 1994 and the related statements of
operations, stockholders' equity (deficit), and cash flows for the year then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit. The financial statements of
Metallurgical Industries, Inc. and subsidiaries for the years ended December 31,
1993 and December 31, 1992 were audited by other auditors. Their report dated
March 21, 1994 included an explanatory paragraph that described uncertainties as
to the Company's ability to continue as a going concern.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion the financial statements referred to above present fairly, in all
material respects, the financial position of Metallurgical Industries, Inc. and
subsidiaries as of December 31, 1994 and the results of its operations and its
cash flows for the year then ended in conformity with generally accepted
accounting principles.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has suffered recurring losses from operations
and has a net capital deficiency. Those conditions raise substantial doubt about
the Company's ability to continue as a going concern. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.

Salt Lake City, Utah
December 22, 1995

F-2
<PAGE>

BROZA, BLOCK & RUBINO GRAND PLAZA
601 Grand Avenue
CERTIFIED PUBLIC ACCOUNTANTS, P.A. Asbury Park, New Jersey 07712
(908) 774-0100 Fax 774-7242

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
Metallurgical Industries, Inc.

We have audited the accompanying consolidated balance sheets of Metallurgical
Industries, Inc. and Subsidiaries as of December 31, 1993 and 1992 and the
related consolidated statements of operations, stockholders' equity (deficit),
and cash flows for the two years ended December 31, 1993. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Metallurgical
Industries, Inc. and Subsidiaries as of December 31, 1993 and 1992, and the
consolidated results of its operations and its cash flows for the two years
ended December 31, 1993, in conformity with generally accepted accounting
principles.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As shown in the financial
statements, the Company incurred a net loss of $2,552,896 during the year ended
December 31, 1993, and, as of that date, had a working capital deficiency of
$1,131,086 and an accumulated deficit of $5,440,552. As described more fully in
Notes 4 and 15 to the financial statements, the Company is in default on its
loan agreements with a bank and in arrears on accounts with certain vendor
creditors which, among other things, causes the balances to become due on
demand. The Company is not aware of any alternate sources of capital to meet
such demands, if made. Those conditions raise substantial doubt about the
Company's ability to continue as a going concern. The financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.

BROZA, BLOCK & RUBINO
Certified Public Accountants

March 21, 1994

Member of AICPA Division for Certified Public Accountant Firms - SEC and Private
Companies Practice Sections

Abraham E. Block, CPA
Anthony Rubino, CPA
Jerome C. Donovan, CPA
Ralph Ciambrone, Jr., CPA

F-3

<PAGE>
<TABLE>
<CAPTION>
METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31, 1994 and 1993

1994 1993
ASSETS ----------- -----------
<S> <C> <C>

CURRENT ASSETS:
Cash ................................................................................... $ 166 $ 6,006
Accounts receivable .................................................................... 291,221
Inventory .............................................................................. -- 482,089
Other current assets -- 925
----------- -----------
TOTAL CURRENT ASSETS ..................... 166 780,241
----------- -----------

PROPERTY AND EQUIPMENT, at cost:
Machinery and equipment ................................................................ -- 491,168
Leasehold improvements and other equipment ............................................. -- 82,672
----------- -----------

Total Property and Equipment ........................................................ -- 573,840
Less accumulated depreciation .......................................................... -- (226,785)
----------- -----------
NET PROPERTY AND EQUIPMENT ..................... -- 347,055
----------- -----------

OTHER ASSETS 41,713 47,452
----------- -----------
TOTAL ASSETS ..................... $ 41,879 $ 1,174,748
=========== ===========

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
Notes payable - bank ................................................................... $ -- $ 297,130
Notes payable - officers and directors ................................................. 59,310 145,835
Accounts payable ....................................................................... 1,030,592 1,246,673
Other current liabilities .............................................................. 153,695 208,856
Current portion of capital lease obligation -- 12,833
----------- -----------
TOTAL CURRENT LIABILITIES ..................... 1,243,597 1,911,327
----------- -----------

LONG-TERM DEBT - NET OF CURRENT PORTION
Long-term capital leases ............................................................... -- 13,614
----------- -----------
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock:
Class A, $.10 par value, shares issued and outstanding,
8,299,800 and 3,622,654 ........................................................... 829,980 362,265
Class B $.10 par value, shares issued and outstanding,
98,438 (convertible into Class A shares) .......................................... 9,844 9,844
Capital in excess of par value ......................................................... 4,534,444 4,318,250
Accumulated deficit .................................................................... (6,575,986) (5,440,552)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) ..................... (1,201,718) (750,193)
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ ................... $ 41,879 $ 1,174,748
----------- -----------

See accompanying notes to consolidated financial statements.

F-4
</TABLE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1994, 1993 and 1992

1994 1993 1992
----------- ----------- ------------
<S> <C> <C> <C>
REVENUE ............................................... $ 535,737 $ 2,758,018 $ 3,177,901
----------- ----------- ------------

COSTS AND EXPENSES:
Cost of sales .................................... 559,828 3,442,695 3,285,196
Selling, general and administrative .............. 1,043,582 1,765,797 1,536,266
Interest ......................................... 31,440 102,422 108,339
----------- ----------- ------------
1,634,850 5,310,914 4,929,801
----------- ----------- ------------
LOSS BEFORE EXTRAORDINARY ITEMS: ...................... (1,099,113) (2,552,896) (1,751,900)

EXTRAORDINARY ITEMS:
Loss on disposition of assets .................... (97,503) -- --
Gain from elimination of debt .................... 61,182 -- --
----------- ----------- ------------
(36,321) -- --
----------- ----------- ------------
NET LOSS .............................................. $(1,135,434) $ (2,552,896) $ (1,751,900)
=========== =========== ============

NET LOSS PER SHARE:
Loss before extraordinary items .................. $ (0.15) $ (1.03) $ (0.88)
Extraordinary item ............................... (0.01) -- --
----------- ----------- ------------
NET LOSS PER SHARE .................................... $ (0.16) $ (1.03) $ (0.88)
=========== =========== ============

AVERAGE COMMON SHARES OUTSTANDING ..................... 7,206,422 2,486,983 1,989,315

See accompanying notes to consolidated financial statements

F-5
</TABLE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED STOCKHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992

Capital
Class A Class A Class B Class B In Excess Accumulated
Shares Amount Shares Amount Of Par Deficit
----------- ----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
BALANCE, December 31, 1991 ................. 1,549,217 $ 154,922 98,438 $ 9,844 $ 2,776,365 $ (1,135,756)

Shares issued through private
placement ............................ 423,437 42,343 -- -- 1,486,885 --
Net loss for the year .................. -- -- -- -- -- (1,751,900)
----------- ----------- ----------- ----------- ----------- -------------
BALANCE, December 31, 1992 ................. 1,972,654 197,265 98,438 9,844 4,263,250 (2,887,656)

Exercise of stock options .............. 1,400,000 140,000 -- -- 55,000 --

Additional shares issued ............... 250,000 25,000 -- -- -- --

Net loss for the year .................. -- -- -- -- -- (2,552,896)
----------- ----------- ----------- ----------- ----------- -------------
BALANCE, December 31, 1993 ................. 3,622,654 362,265 98,438 9,844 4,318,250 (5,440,552)

Exercise of stock options .............. 4,487,800 448,780 -- -- 216,194 --

Additional shares issued for services .. 189,346 18,935 -- -- -- --

Net loss for the year .................. -- -- -- -- -- (1,135,434)
----------- ----------- ----------- ----------- ----------- -------------
BALANCE, December 31, 1994 ................. 8,299,800 $ 829,980 98,438 $ 9,844 $ 4,534,444 $ (6,575,986)
=========== =========== =========== =========== =========== =============

See accompanying notes to consolidated financial statements.

F-6
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992

1994 1993 1992
---------- ---------- ----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ................................................................ $(1,135,434) $ (2,552,896) $ (1,751,900)
----------- ----------- -----------
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization ........................................ 16,595 206,594 152,718
Common stock issued for services ..................................... 683,909 -- --
Loss on disposal of property ......................................... 97,503 (38,260) (10,606)
Abandonment of fixed assets .......................................... -- 26,722 --
Gain from elimination of debt ........................................ (61,182) -- --
(Increase) decrease in accounts receivable ........................... 291,221 124,070 350,622
(Increase) decrease in inventories ................................... 482,089 1,859,117 (248,135)
(Increase) decrease in other assets .................................. 6,664 32,700 168,449
Increase (decrease) in accounts payable .............................. (154,899) 272,611 562,739
Increase (decrease) in accrued liabilities ........................... (55,161) (20,654) (76,350)
----------- ----------- -----------

Total adjustments ....... 1,306,739 2,462,900 899,437
----------- ----------- -----------

Net cash provided (used) by operating activities ....... 171,305 (89,996) (852,463)
----------- ----------- -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
Cash payments for the purchase of property .............................. -- (9,587) (410,002)
Cash proceeds from the sale of property ................................. 232,957 513,262 90,000
----------- ----------- -----------

Net cash provided (used) by investing activities ....... 232,957 503,675 (320,002)
----------- ----------- -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options and
issuance of additional shares ......................................... -- 220,000 --
Net proceeds from private placement ..................................... -- -- 1,154,228
Repayment of debt ....................................................... -- -- (100,000)
Principal payments on capital leases .................................... (26,447) (4,743) (6,471)
Principal payments on long-term debt .................................... (297,130) (719,537) (33,333)
Loans from officers and directors ....................................... -- 100,000 61,000
Repayment of officers and directors loans ............................... (86,525) (5,165) (45,000)
----------- ----------- -----------

Net cash provided (used) by financing activities ....... (410,102) (409,445) 1,030,424
----------- ----------- -----------
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS ............................ (5,840) 4,234 (142,041)
Cash, beginning ......................................................... 6,006 1,772 143,813
----------- ----------- -----------
Cash, ending ............................................................ $ 166 $ 6,006 $ 1,772
=========== =========== ===========
SUPPLEMENTAL DISCLOSURES:
Interest expense ........................................................ $ 31,440 $ 100,838 $ 113,578
=========== =========== ===========
Noncash financing activities:
Issuance of common stock for services ................................ $ 683,909 $ -- --
=========== =========== ===========

See accompanying notes to consolidated financial statements.

F-7

</TABLE>
<PAGE>
METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Metallurgical
Industries, Inc. and its wholly-owned subsidiaries, Intermet Resources, Inc. and
Advanced Welding & Coating Services, Inc. (collectively, the Company). However,
since the Company's wholly-owned subsidiaries were dissolved during 1994 through
chapter 7 bankruptcies, no accounts of subsidiaries are included in the December
31, 1994 balance sheet. Investment in a joint venture, owned 50% by the Company,
was accounted for by the equity method and is included in the accompanying
consolidated statement of operations. All significant intercompany transactions
have been eliminated.

Nature of Business

The Company is located in the United States and marketed various powdered metals
which it either processed or sold without processing. The Company ceased all
active operations on June 30, 1994. Since then the Company's activity has been
largely restricted to maintaining its corporate legal status, negotiating
creditor settlements and searching for mergers or acquisitions.

Inventory

Inventory is valued at the lower of cost or market. Cost is determined by the
first-in, first-out (FIFO) method.

Property and Equipment

Property and equipment are recorded at cost. Depreciation is provided over the
estimated useful lives of the assets on the straight-line method for financial
reporting purposes and accelerated methods for income tax purposes. Gains and
losses on the disposition of fixed assets are recognized in current operations.
Fully depreciated fixed assets are written off against accumulated depreciation.

Revenue Recognition

The Company prepares its financial statements on the accrual basis of accounting
whereby sales are recognized in the period in which they are shipped. The
Company owned certain patents relating to the processing of metals. The patents
were sold in June 1993. Royalty income was based on a percentage of sales of the
licensed products and was included in income in the period that payments were
scheduled to be received.

F-8
<PAGE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Elimination of debt

The Company's wholly-owned subsidiaries had debt in amount of $61,182 which was
discharged in Chapter 7 bankruptcy filings. This amount is reflected in the
consolidated statements of operations as a gain from elimination of debt during
the year ended December 31, 1994.

Taxes on Income

Effective January 1, 1993 the Company adopted Statement of Financial Accounting
Standards No. 109, Accounting for Income taxes. The cumulative effect of the
change in accounting principle is immaterial.

Research and Development

The cost related to basic research and product development is expensed as
incurred. No research and development costs were incurred during the years 1994,
1993 and 1992.

Net Income Per Share

Net income per share is based on the average number of shares outstanding during
each year retroactively adjusted to give effect to all stock splits. Stock
options and warrants have been excluded from the 1994, 1993 and 1992 per share
calculations due to their anti-dilutive effect.

F-9
<PAGE>

Basis of Financial Statement Presentation

The Company's financial statements have been presented on the basis that it is a
going concern, which contemplates the realization of assets and satisfaction of
liabilities in the normal course of business. The Company incurred losses before
extraordinary items of $1,099,113 in 1994, $2,552,896 in 1993 and $1,751,900 in
1992. At December 31, 1994, the Company's current liabilities exceeded its
current assets by $1,243,431, and the stockholders equity reflects a deficit of
$1,201,718. The Company's continued existence is dependent on its ability to
generate sufficient cash flow to cover operating expenses, to settle its
obligations and develop an active business. As described in Note 14, the
Company's management has started negotiations for a merger with a "going
concern" company.

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)

NOTE 2 - INVENTORY

Inventory consists of the following:

December 31,
1994 1993

Raw materials $ - $163,385
Work-in-process - -
Finished goods 318,704
--------- --------
$ - $482,089
========= ========

NOTE 3 - NOTES PAYABLE - OFFICERS AND DIRECTORS

Notes payable to officers and directors consists of the following:

December 31,
1994 1993

Note payable, with interest at 8% $ 41,760 $ 51,000
Note payable, with interest at 8.5% 17,550 -
Note payable, due $2,149 per month
in 60 monthly installments, with
interest at prime plus 2.5%
secured by all machinery and
equipment - 94,835
-------- --------
$ 59,310 $145,835
======== ========

At December 31, 1994 and 1993 the above notes payable to officers and directors
were in default.

NOTE 4 - NOTES PAYABLE - BANK

In 1993 the bank notified the Company that it was declaring its loans to the
Company in default. Accordingly, all long-term bank debt was reclassified from
long-term to current.

Long-term debt as of December 31, 1993 $297,130
Less current maturity 297,130
--------

Long-term debt $ -
========

F-10
<PAGE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)

NOTE 5 - CAPITAL AND OPERATING LEASE OBLIGATIONS FOR EQUIPMENT

During 1994, the Company defaulted on its capital and operating lease
obligations and the equipment was repossessed.

NOTE 6 - STOCK OPTIONS AND WARRANTS

No options relating to the Company's 1989 stock option plan were exercised
during 1994, and the outstanding options expired on March 22, 1994.

On September 8, 1993, the Company adopted its 1993 stock option plan. Pursuant
to the plan, the Board of Directors of the Company can issue options to purchase
up to 2,587,800 shares of the Class A common stock over a 10 year period. All
options under the plan are non-qualified stock options. The exercise price of
options granted was based on the average of the closing bid/asked prices for the
common stock over the 20 day trading period immediately prior to the grant or
upon the bid price on the date of the grant.

On February 11, 1994, the Company adopted its 1994 stock option plan. Pursuant
to the plan, the Board of Directors of the Company can issue options to purchase
up to 3,300,000 shares of the Class A common stock over a 10 year period. All
options under the plan are non-qualified stock options. The exercise price of
options granted was based on the average of the closing bid/asked prices for the
common stock over the 20 day trading period immediately prior to the grant or
upon the bid price on the date of the grant.

Activity under the Company's plans was as follows:
Number of Option
Shares Price per share
Outstanding at December 31, 1991 39,100 $3.125 - $8.50
Granted - -
Exercised - -
Cancelled - -
---------

Outstanding at December 31, 1992 39,100
Granted ,587,800 .10 - .25
Exercised (1,400,000) .10 - .25
Cancelled -
---------

Outstanding at December 31, 1993 1,226,900 .10 - 8.50
Granted 3,300,000 .10 - .25
Exercised (4,487,800) .10 - .25
Cancelled ( 39,100)
---------

Outstanding at December 31, 1994 -
=========

F-11
<PAGE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)

NOTE 7 - COMMON STOCK

The details of the Company's Common Stock at December 31, 1994, 1993 and 1992
are as follows:
Number of Shares
1994 1993 1992
---------- ---------- ----------
Class A, $.10 par value:
Authorized 10,000,000 10,000,000 10,000,000
Issued and outstanding 8,299,800 3,622,654 1,982,654

Class B, $.10 par value:
Authorized 222,000 222,000 222,000
Issued and outstanding 98,438 98,438 98,438

Class B shares are convertible into Class A shares on a one-for-one basis and
each class has the same rights and privileges with the exception of voting.

Pursuant to a 1966 stock purchase contract, the Company agreed not to issue
additional shares of Class A or B stock as long as a certain major stockholder
owns a minimum of 57,000 shares of Class A Common Stock. This restriction does
not include the issuance of Class A Common Stock for (l) property, (2) options
and warrants, (3) conversion of Class B shares. However in the event of a public
or private offering, the major Class A stockholder is entitled to purchase its
pro-rata share of such placement at the offering price.

NOTE 8 - INCOME TAXES

At December 31, 1994, the Company had a net operating loss (NOL) carryforward
totaling approximately $2,700,000 that may be offset against future taxable
income in varying amounts through 2001. In addition, the Company has certain tax
credit carryforwards of approximately $131,000 which expire in varying amounts
between 2000 and 2005. The Company has a $7,000,000 capital loss carryover that
expires in 1999. Loss carryovers of approximately $6,500,000 and tax credits of
Approximately $122,000 were lost during 1994 when the Company's subsidiaries
were dissolved pursuant to Chapter 7 bankruptcy. No benefit has been reported in
the financial statements, however, because the Company believes there is at
least a 50% chance that the carryforwards will expire unused. Accordingly, the
tax benefit of the loss carryforward has been offset by a valuation allowance of
the same amount. The expected tax benefit resulting from applying federal
statutory tax rates to the pretax loss differs from amounts reported in the
financial statements because of the increase in valuation allowance. Certain
provisions of the tax law may limit the net operating loss, capital loss and
credit carryovers in the event of a significant change in ownership of the
Company.

F-12
<PAGE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENT
(Continued)

NOTE 9 - PROFIT SHARING PLANS

During 1994, 1993, and 1992, the Company made no employer contributions to its
qualified profit-sharing plan or its 401K plan. Contributions are made solely at
the discretion of management.

NOTE 10 - COMMITMENTS AND CONTINGENCIES

The Company leased manufacturing, storage and office facilities under an
operating lease. The lease agreement stated that tenancy was from month to month
after December 31, 1993, terminable by either party on 30 days prior notice but
no later than March 31, 1994. The Company was evicted on or about March 31,
1994. The Company believes that additional charges after that date are not
justified according to the terms of the lease agreement. The landlord has billed
the Company for a variety of charges since that date resulting in a disagreement
over the amount owed by the Company. As of December 31, 1994, the Company has
recorded an obligation of $354,711 as compared to the landlord's claim of
$651,047, resulting in an amount in dispute of approximately $296,000. This
disputed amount does not appear as an obligation on the Company's financial
statements. No law suits have been filed to date regarding the disputed amount,
however, the landlord received a judgment in its favor in 1993 in the amount of
$351,005 representing the Company's obligation at September 24, 1993. The
Company believes that the possibility of an unfavorable outcome regarding this
disputed amount is reasonably possible but not probable.

Additionally, the Company is obligated under its lease agreement to reimburse
the landlord for all costs of environmental clean-up. The Company executed two
security agreements with the landlord as the secured party for the costs of
clean-up. The first $100,000 is subordinate only to the security interest of the
bank debt, if any, taxes owed to Internal Revenue Service, and State of New
Jersey taxes. Any liability in excess of $100,000 is secured but subordinate to
the security interest of the same entities plus that of Ira and Lawrence
Friedman. The Company had insurance policies which it believes should cover
approximately $100,000 of the clean-up costs. The Company cannot determine at
this time what impact, if any, this matter will ultimately have on its financial
position.

F-13
<PAGE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)

NOTE 11 - BUSINESS SEGMENT DATA

The Company's operations were conducted through two business segments: specialty
metals processing and advanced welding technology activities. These segments and
the primary operations of each are described below.

Information concerning this data is as follows: Loss from operations is total
revenue less operating expenses and state income taxes. Identifiable assets are
those assets used in the Company's operation for each segment.

December 31,
1994 1993 1992
----------- ----------- ------------
REVENUE:

Specialty metals
processing $ 535,681 $ 2,302,320 $ 2,094,036
Advanced welding
activities - 444,323 853,642
----------- ----------- -----------

$ 535,681 $ 2,746,643 $ 2,947,678
=========== =========== ===========
LOSS FROM OPERATIONS:

OPERATING LOSSES:

Specialty metals
processing $(1,062,413) $(1,958,979) $( 936,036)
Advanced welding
activities ( 5,316) ( 502,872) ( 937,748)
Interest expense ( 31,440) ( 102,420) ( 108,339)
Other income 56 11,375 230,223
----------- ----------- -----------
LOSS FROM OPERATIONS $(1,099,113) $(2,552,896) $(1,751,900)
=========== =========== ===========
IDENTIFIABLE ASSETS:

Specialty metals
processing $ 41,879 $ 1,016,291 $ 2,761,005
Advances welding
activities - 148,457 1,140,932
----------- ----------- -----------

$ 41,879 $ 1,174,748 $ 3,901,937
=========== =========== ===========

F-14
<PAGE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)

NOTE 11 - BUSINESS SEGMENT DATA (Continued)

CAPITAL SPENDING:
December 31,
1994 1993 1992
Specialty metals
processing $ - $ 9,587 $ 152,068
Advanced welding
activities - - 293,780
---------- ----------- -----------

$ - $ 9,587 $ 445,848
========== =========== ===========

DEPRECIATION:

Specialty metals
processing $ 12,665 $ 100,804 $ 70,182
Advanced welding
Activities 3,930 26,613 82,536
---------- ----------- -----------

16,595 $ 127,417 $ 152,718
========== =========== ===========

F-15
<PAGE>

For the years ended December 31, 1994 and 1993, there were no individual
customers who accounted for sales of 10% or greater.

For the year ended December 31, 1992, one customer comprised 10% of the
Company's sales. Sales to this customer were approximately $417,000.

NOTE 12 - PRIVATE PLACEMENT

During 1992, the Company issued 423,437 shares of Class A common stock through a
private placement offering at $4.00 per share. Total proceeds from the offering
were $1,529,228 net of applicable expenses in the amount of $164,520. Included
in the private placement was the conversion of $375,000 of notes payable to
officers and directors.

In addition, for every share issued, a stock warrant was issued to purchase one
additional share of Class A common stock. The warrants are exercisable over a
five-year period at a price of $4.00 per share.

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)

NOTE 13 - RELATED PARTY TRANSACTIONS

In December of 1994, the Company moved its offices from Tinton Falls, New Jersey
to the offices of Canton Financial Services Corporation (CFSC) in Salt Lake
City, Utah. CFSC is a wholly- owned subsidiary of Canton Industrial Corporation.
At that time the Company entered into a management and consulting agreement with
CFSC and Richard D. Surber became the Company's president and chief executive
officer. Mr Surber is a shareholder of the Company and also Chief Executive
Officer and shareholder of Canton Industrial Corporation.

NOTE 14 - SUBSEQUENT EVENTS

During the first six months of 1995 the Company settled debts with various
creditors in the amount of $233,726 in exchange for the issuance of 158,566
shares of Class A common stock.

On February 1, 1995, the Board of Directors unanimously approved a 1 for 40
reverse stock split of the Class A common stock, and a decrease in the
authorized number of shares of Class A common stock from 10,000,000 to 250,000.
Authorized Class A common stock was subsequently increased to 200,000,000
shares.

Pursuant to an agreement dated February 28, 1995 the Company's president is
entitled to receive as compensation for services rendered 5,000 shares of Class
A common stock per month and an option to purchase 5,000 additional shares per
month at an option price of $0.50 per share. Compensation through July 1995 for
services has been made through the issuance of 37,500 shares in August 1995. On
November 21, 1995, the Company issued another 15,000 shares to Mr. Lifschutz for
services rendered from August to October. In addition 28,463 shares were issued
for a finders fee.

On March 1, 1995, the Company entered into consulting agreements with Karston
Electronics, Ltd. and East-West Trading Corp. As compensation for consulting
services, the Company issued to Karston and East-West each 120,000 shares of its
Class A common stock. The Company also granted both Karston and East-West
options to purchase up to 250,000 shares of the Company's common stock at an
exercise price of $0.50 per share to be exercised no later than August 4, 1996.

On April 1, 1995, the Company issued 186,008 shares of Class A common stock to
officers and directors for services rendered prior to 1995.

F-16
<PAGE>

METALLURGICAL INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)

NOTE 14 - SUBSEQUENT EVENTS (Continued)

A Special Meeting of Shareholders of the Company held on March 21, 1995 approved
the following proposals: to increase the number of authorized shares of the
Company to 200,000,000 of Class A common stock and 220,000 shares of Class B
common stock; to reduce par value per share of Class A and Class B common stock
from $0.10 to $0.001; and to change the Company's name to BRIA Communications
Corp., effective April 1, 1995. On March 24, the Company issued 115,000 shares
of its Class B common stock to Canton Financial Services Corporation for
services rendered in relation to the shareholders' meeting.

On May 16, 1995, the Company entered into a one-year consulting agreement with
Canton Financial Services Corporation (CFSC). This agreement replaces an earlier
agreement dated December 16, 1994 (see Note 13). According to the agreement CFSC
would assist the Company in locating a potential corporate entity for
acquisition or merger, assist with the restructuring of the Company's common
stock, arrange for a public stock offering, and assist in the preparation of
agreements, documents, filings and other material necessary to effectuate the
above services. The agreement also entitled CFSC to receive a finders fee upon
the presentation of a suitable merger or acquisition candidate. Accordingly,
CFSC received shares of the Company's Class A common stock in July, 1995:
1,954,931 shares for services and 1,144,660 as a finders fee related to the
proposed AltaChem transaction discussed below.

During July, 1995, the Company issued 500,000 shares of Class A common stock in
exchange for media credits and 200,000 shares in exchange for trade credits, and
53,400 shares to officers and directors for services.

On September 1, 1995 the Company issued 21,623,996 shares of its Class A common
stock. The issuance represents 75% of the Company's issued and outstanding Class
A common stock and was done pursuant to a proposed Stock Exchange Agreement
which would give the Company 100% ownership of AltaChem Group, Inc. AltaChem is
a chemical company, formed under laws of the Republic of Ireland. AltaChem
manufactures, distributes and sells chemicals used in the building industry. The
Company believes that the exchange will qualify as a tax free reorganization
under the provisions of the Internal Revenue Code. If the exchange is completed,
the present shareholders of AltaChem would own 75% of the Company, and the
Company would own 100% of AltaChem. If the transaction is not completed by
December 31, 1995, the shares will be returned to the Company.

F-17

<PAGE>

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE (Subsequent to December 31, 1994)

On January 11, 1995, the Company relieved its independent accountant,
Broza, Block & Rubino ("Broza") of its duties. Broza had been the Company's
independent accountant for over ten years. The Company filed a Form 8-K on
January 16, 1995, and a Form 8-K/A on February 6, 1995 and also on March 8,
1995. The February 6, 1995 Form 8-K/A was filed to respond to Rule 304(a)(1)(iv)
of Regulation S-B which was not done in the January 16, 1995 report. The March
8, 1995 Form 8-K/A was filed because the Company had then just received Broza's
response to the original Form 8-K.

Neither of Broza's reports on the financial statements for the two
years prior to Broza's discharge contained an adverse opinion or disclaimer of
opinion, or was modified as to uncertainty, audit scope or accounting
principles; however, the financial statements included in the Company's 1993
10-K report, prepared by Broza, included a single sentence expressing its doubt
as to the Company's ability to continue as a going concern.

The decision to change accountants was recommended by the board of
directors and stemmed from a change in the Company's headquarters, which were
moved from Shrewsbury, New Jersey to Salt Lake City, Utah. The board of
directors believed that the vast distance between the Company and Broza made
continuation of the relationship logistically and financially impractical.

There were no disagreements between Broza and the Company on any matter
of accounting principles, financial statement disclosure or auditing scope or
procedure during the two most recent fiscal years and subsequent period.

In January 1995, the Company reached an agreement to have Michael L.
Roper, CPA, become its independent auditor for the fiscal year ending December
31, 1994. Included in the proxy material relating to the March 14, 1995 Special
Meeting was a proposal asking for shareholder ratification of this selection.
However, after the definitive proxy material was distributed to shareholders and
before the Special Meeting, the Company decided against utilizing Mr. Roper's
accounting and auditing skills and therefore never formally engaged Mr. Roper as
its independent auditor.

A new independent auditor, Andersen, Andersen & Strong, was retained by
the Company on August 28, 1995 to perform the Company's audit for the fiscal
year ending December 31, 1994. The need to retain a new auditor for the fiscal
year ending December 31, 1994, contributed to the Company's delay in filing this
Form 10-KSB.

[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]

<PAGE>

PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Directors, Executive Officers and Control Persons

Name Age Position(s) and Office(s)

Richard Lifschutz 49 Director, President

James Tilton 34 Director, Chief Executive Officer

Aster De Schrijver 53 Director

Jane Zheng 33 Director, Secretary and Treasurer

Richard Lifschutz works as a business consultant in several industries
and was appointed the Company's president and one of its directors on March 1,
1995. During the last five years, Mr. Lifschutz has been involved with Lev-Ari
Communications in public relations, advertising and film and video production.
Additionally, Mr. Lifschutz has been a media and barter broker for approximately
the last three years on the "Itex" barter network. Mr. Lifschutz is a member of
the Screen Actors Guild and also works as a consultant to movie production
companies and has appeared in several productions as an actor.

Aster De Schrijver was appointed a director and Chairman of the Board
of the Company on August 3, 1995. Mr. De Schrijver is a plastics engineer with
an MBA degree from the University of Antwerp, Belgium. He has over 15 years of
experience in polyurethane foams and worked in the development and technical
services departments at Shell and ICI Europe. He founded a polyurethane foam
company, PCO A.G. Switzerland, in 1976 and went on to represent Belgium on a
plastic technology exchange mission to China in 1982. Mr. De Schrijver is also a
director of Tianrong Building Material Holdings, Ltd., a Utah corporation, and
OMAP Holdings, Inc., a Nevada corporation. He is the majority shareholder and
president of ADS Group, Inc., a Belgian corporation which owns a majority of the
Company's Class A common stock. For more information on this stock ownership,
see "Item 11 - Security Ownership of Certain Beneficial Owners and Management."

James Tilton was appointed the Company's chief executive officer and
one of its directors on August 3, 1995. Mr. Tilton has extensive business and
marketing experience in the Far East and has worked with his wife, Jane Zheng,
in partnership with the Metallic Building Company ("MBC"), a subsidiary of NCI
Building Systems (a NASDAQ listed company), to market its pre-engineered
building materials and chemicals in the People's Republic of China ("PRC") since
1991. For over the last five years and again with Jane Zheng, he has assisted
Star bright, a division of Ocean Bio-Tech, in establishing a sales distribution
system in PRC for its chemical products. Mr. Tilton is also a director of
Tianrong Building Material Holdings, Ltd., a Utah corporation, and OMAP
Holdings, Inc., a Nevada corporation.
<PAGE>

Jane Zheng was appointed as a director and secretary/treasurer of the
Company on August 3, 1995. Ms. Zheng has extensive business and marketing
experience in the Far East and has worked with her husband, James Tilton, in
partnership with the Metallic Building Company ("MBC"), a subsidiary of NCI
Building Systems (a NASDAQ listed company), to market its pre-engineered
building materials and chemicals in the Peoples Republic of China since 1991.
For over the last five years and again with James Tilton, Ms. Zheng has assisted
Star bright, a division of Ocean Bio-Tech, in establishing a sales distribution
system in PRC for its chemical products. She received her engineering degree
from Shanghai University, in Shanghai, China. Ms. Zheng also has an MBA degree
in Finance from Adelphi University, New York, and serves as a director of
Tianrong Building Material Holdings, Ltd., a Utah corporation, and OMAP
Holdings, Inc., a Nevada corporation.

Compliance with Section 16(a) of the Exchange Act

The Company is not aware of any person who, at any time during the
fiscal year ended December 31, 1994, was a director, officer, or beneficial
owner of more than ten percent of the common stock of the company, and failed to
file on a timely basis reports required by Section 16(a) of the Securities
Exchange Act of 1934 during such fiscal year.

The Company is aware that James Tilton, the Company's chief executive
officer and one of its directors, failed to timely file reports required by
Section 16(a) of the Securities Exchange Act of 1934 as required to have been
filed in August 1995. The Company is aware that Aster De Schrijver, one of the
Company's directors, failed to timely file reports required by Section 16(a) of
the Securities Exchange Act of 1934 as required to have been filed in August
1995. Mr. Tilton and Mr. De Schrijver filed these Forms 3 with the SEC on
December 6, 1995.

ITEM 10. EXECUTIVE COMPENSATION

Executive Compensation

No compensation in excess of $100,000 was awarded to, earned by, or
paid to any executive officer of the Company during the 1994 fiscal year.

The following table provides summary information for each of the last
three fiscal years concerning cash and non-cash compensation paid or accrued by
the Company to or on behalf of Ira Friedman, who, until his resignation in
December of 1994, had served as the president and chief executive officer of the
Company since 1972 and a director since 1967. The Company's current chief
executive officer, James Tilton, has not received any compensation from the
Company.

[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]

SUMMARY COMPENSATION TABLE
Long Term Compensation
-------------------------------------------
Annual Compensation Awards Payouts
------------------------------------- ------------------------------ ---------
Other Annual Restricted Securities All Other
Name and Compen- Stock Underlying LTIP Compen-
Principal Position Year Salary($) Bonus($) sation($) Award(s)($) Options/SARs(#) Payouts($) sation($)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Ira Friedman 1994 100,000(1) - 0 - - - -
Former CEO & 1993 85,157 - 0 - - - -
President 1992 86,833 - 2,000 - - - -

</TABLE>

(1) Mr. Ira Friedman recieved the sum of $50,000 towards his annual salary.

COMPENSATION OF DIRECTORS

There is no standard arrangement by which the Company's directors are
compensated for services provided as directors. No director received any cash
compensation for services as a director in the fiscal year ended December 31,
1994, or as of November 15, 1995. Directors are not precluded from serving in
any other capacity as an officer, agent, employee, or otherwise, and receiving
compensation therefor.

Richard Lifschutz, the Company's president and one of its directors,
has an Letter of Agreement dated February 28, 1995. Pursuant to this Agreement
Mr. Lifschutz is entitled to receive 5,000 restricted shares per month for
services rendered as the Company's president as well as options to purchase
5,000 additional shares per month at an option price of $0.50 per share. As of
November 15, 1995, the Company has issued Mr. Lifschutz 25,000 shares for five
months of service and 12,500 shares that were optioned. The option price was
waived by the board of directors as a bonus. On November 21, 1995, another
15,000 shares ware issued to Mr. Lifschutz for services rendered. In addition,
pursuant to his employment contract, Mr. Lifschutz received 28,463 shares of the
Company's Class A common stock. On August 16, 1995 as finders' fee for
introducing ITEX to the Company. See "Item 11 - Security Ownership of Certain
Beneficial Owners and Management" for additional information on the amount of
shares which Mr. Lifschutz beneficially owned as of November 15, 1995.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

On November 15, 1995, there were 26,778,559 shares of the Company's
Class A common stock and 213,438.5 shares of its Class B common stock issued and
outstanding. The following table sets forth selected information concerning the
stock ownership as of November 15, 1995, with respect to (i) each person who is
known to the Company to be the beneficial owner of more than 5 percent of the
Company's common stock; (ii) all directors; (iii) each of the executive
officers; and (iv) directors and executive officers of the Company as a group
(for more information on the Company's Class A common stock and Class B common
stock, see "Item 5 - Market for Registrant's Common Equity and Related
Stockholder Matters"):

<PAGE>

<TABLE>

- ----------------------- ------------------------------------------ -------------------------------- -----------------
Name and Address Amount and Nature of Percent
Title of Class of Beneficial Owner Beneficial Ownership (*Please of Class
see note below) (*Please see
note below)
<S> <C> <C> <C> <C>
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock ADS Group 18,740,796 69.98%
$0.001 par value 18 St. Georges Street
Douglas, Isle of Man IM11PC
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock Canton Financial Services Corp. 1,487,531 5.55%
$0.001 par value 268 West 400 South, Suite 300
Salt Lake City, UT 84101
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock A-Z Professional Consultants, Inc. 1,612,000 6.02%
$0.001 par value 268 West 400 South, Suite 300
Salt Lake City, UT 84101
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock Richard Surber 3,099,531(1) 11.57%
$0.001 par value 268 West 400 South, Suite 300
Salt Lake City, Utah 84101
- ----------------------- ------------------------------------------ -------------------------------- -----------------
OFFICERS AND DIRECTORS
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock James Tilton(2) 21,663,996(2) 80.90%
$0.001 par value 82-66 Austin Street
Kew Gardens, NY 11415
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock Jane Zheng(3) 40,000(3) 0.15%
$0.001 par value 82-66 Austin Street
Kew Gardens, NY 11415
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock Richard Lifschutz(4) 133,463 0.41%
$0.001 par value 147-17 Newport Avenue
Neponsit, NY 11964
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock Aster De Schrijver(5) 18,780,796(5) 70.13%
$0.001 par value 18 St. Georges Street
Douglas, Isle of Man IM11PC
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class A Common Stock All Officers and Directors as a Group 21,730,139(6) 81.15%(6)
$0.001 par value
- ----------------------- ------------------------------------------ -------------------------------- -----------------
CLASS B COMMON STOCK
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class B Common Stock Ira L. Friedman 98,438 46.12%
$0.001 par value 10 Bingham Hill Circle
Rumson, New Jersey 07760
- ----------------------- ------------------------------------------ -------------------------------- -----------------
Class B Common Stock Canton Financial Services Corp. 115,000 53.88%
$0.001 par value 268 West 400 South, Suite 300
Salt Lake City, UT 84101
- ----------------------- ------------------------------------------ -------------------------------- -----------------
</TABLE>

<PAGE>

* Amounts of beneficial ownership will not collectively reflect the actual
number of shares outstanding and the percentages of class ownership will exceed
100% due to indirect & common beneficial ownership of certain shares.

(1) Includes 1,612,000 shares held by A-Z Professional Consultants, Inc., of
which Mr. Surber is the president and sole director. Mr. Surber disclaims
beneficial ownership of such shares. Also includes 1,487,531 shares owned by
Canton Financial Services Corp., wholly owned subsidiary of The Canton
Industrial Corporation of which Mr. Surber is a director and chief executive
officer. Mr. Surber disclaims beneficial ownership of such shares.

(2) Includes 18,740,796 shares held by ADS Group, a Belgium corporation whose
chief executive officer is Mr. Tilton. Mr. Tilton disclaims beneficial ownership
of such shares. This figure also includes 2,883,200 shares which were issued
pursuant to the Stock Exchange Agreement dated December 8, 1995. See "Item 6 -
Management Discussion & Analysis" for more information on this agreement. In
addition, the figure takes into consideration 40,000 shares purchased by
Tianrong Building Material Holding Ltd., of which James Tilton is the President
and a director. Mr. Tilton disclaims beneficial ownership of such shares.

(3) Includes 40,000 shares owed by Tianrong Building Material Holding Ltd., of
which James Tilton is the Secretary and Treasurer and a director. Ms. Zheng
disclaims beneficial ownership of such shares.

(4) Includes 67,500 shares of Class A common stock which may be acquired
pursuant to options which are exercisable within 60 days.

(5) Includes 18,740,796 shares held by ADS Group, a Belgium corporation of which
Mr. De Schrijver is the majority shareholder and president. The number also
includes 40,000 shares owed by Tianrong Building Material Holding Ltd., of which
Mr. De Schrijver is Chairman of the Board and a director. Mr. De Schrijver
disclaims beneficial ownership of such shares.

(6) Only includes the 18,740,796 shares owned by ADS Group once, despite the
indirect beneficial ownership of both Mr. Tilton and Mr. De Schrijver.
Similarly, the figure only includes 40,000 shares owed by Tianrong Building
Material Holding Ltd. once, despite the indirect ownership of James Tilton,
Aster De Schrijver, and Jane Zheng. See above notes (2) and (5) for additional
information regarding the indirect beneficial ownership of these shares.
<PAGE>

Changes in Control

There are no other arrangements within the knowledge of the Company's
management that may result in a change in control of the Company.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

James Tilton, Jane Zheng, Aster De Schrijver & AltaChem

To encourage AltaChem to enter into the Stock Exchange Agreement, on
August 3, 1995, the Company's board of directors unanimously appointed James
Tilton, Jane Zheng and Aster De Schrijver to serve as directors of the Company.
See "Item 1 - Description of Business" for additional information regarding this
possible merger. James Tilton and Aster De Schrijver are officers and directors
of AltaChem, and, aside from these positions, are the beneficial owners,
directly or indirectly, of 100% of AltaChem's common stock. Jane Zheng is the
wife of James Tilton. See "Item 11 - Security Ownership of Certain Beneficial
Owners and Management" and "Item 12 - Certain Relationships and Related
Transactions" for more information on James Tilton, Jane Zheng and Aster De
Schrijver. Upon the resignation of Richard D. Surber, on August 5, 1995, from
the position as a director of the Company and as its secretary/treasurer, the
board of directors appointed Ms. Zheng to serve as secretary/treasurer, and also
appointed Mr. Tilton as the chief executive officer of the Company. Mr. Surber
resigned for personal reasons and with no disagreements or disputes with the
Company or its management. For more information on these officers and directors,
please see "Item 9 - Directors, Executive Officers, Promoters and Control
Persons; Compliance with Section 16(a) of the Exchange Act."
<PAGE>

Canton and A-Z

Since January 1993, the Company has completed several transactions, as
detailed below, with The Canton Industrial Corporation, a Nevada corporation
("Canton"), and A-Z Professional Consultants, Inc., a Utah corporation ("A-Z").
Richard D. Surber, the Company's former president, is the president and sole
director of A-Z and a director and chief executive officer of Canton. By virtue
of his positions with Canton and A-Z, Mr. Surber may be deemed to have had a
direct interest in transactions with Canton and A-Z.

Canton

On September 23, 1993, the Company signed a Stock Purchase Agreement
allowing Canton to exchange 11,823,006 restricted shares of Canton common stock
for 5,000,000 shares of the Company's restricted Class A common stock. The
Agreement required shareholder approval no later than December 3, 1993, which
was subsequently extended to December 10, 1993. No definitive contract was
signed and, on February 23, 1994, the Company withdrew the proxy it had filed
with the SEC regarding the reorganization with Canton.

Pursuant to the proposed stock exchange with Canton, the Company
issued options for approximately 5,587,000 shares, which were registered
pursuant to either the Company's 1993 Stock Option Plan or 1994 Stock Option
Plan. These options were granted to consultants who assisted the Company in
restructuring its business and helped locate suitable acquisition or merger
candidates. The consultants introduced the Company to several acquisition
candidates, none of which turned out to be suitable. As of March 31, 1994,
options worth 1,728,000 shares had been exercised and of June 1, 1994, all of
the options described above had been exercised. Richard D. Surber was granted
options worth a total of 690,000 options between September 1, 1993 and February
28, 1994 (290,000 from the 1993 Option Plan and 400,000 from the 1994 Option
Plan). Mr. Surber exercised options worth 290,000 shares on September 10, 1993,
options worth 100,000 shares on February 23, 1994, and the final options worth
300,000 shares on March 8, 1994. Mark Wolfson, at the time a consultant to
Canton, was granted options worth 650,000 shares from the 1993 Option Plan. Mark
Wolfson's brother is Allen Z. Wolfson, the sole shareholder of A-Z Professional
Consultants who also may be deemed to be a "control person" of Canton, as that
term is defined by rules and regulations promulgated by the SEC. See this "Item
12 - Certain Relationships and Related Transactions" for additional information
on A-Z Professional Consultants and Allen Wolfson. Mark Wolfson exercised
options worth 300,000 shares on September 10, 1993 and the final options worth
350,000 shares on February 8, 1994.

On September 30, 1993, the Company entered into a real estate sales
agreement with Canton whereby the Company agreed to purchase from Canton certain
real estate in West Virginia for $1,506,174. The form of payment wastwo $100,000
promissory notes signed by the Company, a promissory note in the amount of
$175,000 secured by a mortgage on the land, and 500,000 shares of the Company's
Class A common stock. A modifying addendum to the original agreement dated
February 7, 1994, allowed the Company to return the property if an independent
appraisal valued the real estate at less than $1,506,174. In the event the
property was returned, the Company was to receive shares of Canton's stock equal
in value to the $1,506,174. The addendum also modified the form of the Company's
payment of the purchase price to be equal to 1,142,000 shares of Metallurgical
stock plus a promissory note for $375,000. The Company subsequently notified
Canton that it was dissatisfied with the appraisal and elected not to take the
real estate or shares of Canton stock equivalent to $1,506,174 and thereby
terminated the September 30, 1993 real estate sales agreement and its February
7, 1994 addendum.
<PAGE>

On May 16, 1995, the Company entered into a Consulting Agreement with
Canton Financial Services Corporation ("CFSC"), a wholly-owned subsidiary of
Canton. Pursuant to the agreement, which has a one year term unless thirty days
written notice is provided and can be extended on a monthly basis, CFSC would
assist the Company in locating or forming a public company for a potential
merger or acquisition, assisting in a restructuring of the Company's common
stock, arranging for a public offering, and assisting the Company in the
preparation of agreements, documents, filings and other material necessary to
effectuate the above services. The Company agreed to pay CFSC a monthly
consulting fee which shall be the greater of: (a) $20,000 or (b) actual fee for
services provided by CFSC's professional staff. The Company has the option of
either pay cash or the Company's Class A common stock. This agreement also
provided for CFSC receiving a finders fee upon the presentation of a suitable
merger or acquisition candidate. Pursuant to this consulting agreement, on July
31, 1995, the Company issued 5% of its authorized but unissued Class A common
stock, or 1,144,600 restricted shares, to CFSC as a finders fee for introducing
the Company to AltaChem.

AZ Professional Consultants, Inc. ("A-Z")

Richard Surber, the president and sole director of A-Z, is a director
and the chief executive officer of Canton. He is also the nephew of Allen
Wolfson, the sole shareholder of A-Z. Allen Wolfson may be deemed to be a
"control person" of Canton, as that term is defined by S.E.C. regulations.

In September 1993, A-Z sold the Company a second mortgage on property
located in Lee County (Ft. Myers) Florida, which was valued at $47,411.50, in
exchange for 189,646 restricted Class A shares of the Company's stock. In May
1994, the Company discovered that the property in question had been foreclosed
on by the first mortgagor in August 1993. The Company advised A-Z of this and
A-Z agreed to void the transaction and return the shares to the Company. The
shares were returned in May 1994.

Settlement Agreements Among Canton, A-Z, and the Company

As a result of some of the aforementioned agreements not being
consummated or not being performed as envisioned, several disputes arose among
the Canton, A-Z, and the Company. To avoid legal proceedings and settle all
disputes, the Company, A-Z, Canton, together with Ira L. Friedman, former
president, chief executive officer, and a director of the Company ("Friedman")
and Richard T. Johnson, formerly the chief financial officer, vice president of
finance, and a director of the Company ("Johnson"), executed a Settlement
Agreement dated December 16, 1994 (the "Settlement Agreement"). See "Item 1
Description of Business, Business of Issuer" and "Item 6 - Management Discussion
and Analysis" for additional discussion of this agreement.
<PAGE>

In consideration for the release by Canton and A-Z of the Company,
Friedman and Johnson from any and all claims, causes of action, and obligations
relating to the agreements, Friedman and Johnson appointed Richard D. Surber as
president and director of the Company and agreed to appoint two other persons to
the Company's board that Canton would nominate. Canton nominated Bobby G. Welch,
II and Christopher Swaner as directors of the Company and both were in fact
appointed. The Settlement Agreement also called for Friedman and Johnson to
resign from their positions and request the Company's other officers and
directors also resign. Effective December 16, 1994, the Company's officers along
with directors Keith R. Garrity and Edward Mentzer resigned. The board of
directors appointed Mr. Surber to fill Mr. Garrity's term as a director.
Effective December 17, 1994, Friedman, Johnson and Lawrence S. Friedman resigned
from the board of directors, leaving Mr. Surber as the Company's sole director,
until the appointments of Mr. Welch and Mr. Swaner in January 1995. See "Item 6
- - Management Discussion and Analysis, Changes in Corporate Management" for
additional information on the change in control of the Company.

In addition, as payment for past services rendered, the Company agreed
to issue Friedman, Johnson, and Lawrence Friedman 10% of the issued and
outstanding Class A Common Stock after any reverse stock split excluding any
shares owned by Friedman, Johnson, and Lawrence Friedman. The Company shall
issue such shares as follows: 4.9% to Friedman, 4.9% to Johnson, and 0.2% to
Lawrence Friedman. The shares were issued on April 1, 1995 when the number of
issued and outstanding Class A Common Stock was 186,008 (excluding shares owned
by the three former officers and directors). Consequently, Friedman and Johnson
each received 91,144 shares and Lawrence Friedman received 3,720 shares.

Immediately after Mr. Surber's December 16, 1994 appointment as
president and director of the Company, the principal offices of the Company
moved from Tinton Falls, New Jersey, to 268 West 400 South, Suite 300, Salt Lake
City, Utah. The Settlement Agreement stipulated that Canton would be paid
1,612,000 restricted shares of the Company's Class A common stock for the
services it had rendered to that date and for services it would render in
completing the proxy statement for the Company's March 14, 1995 Special Meeting
of Shareholders. See "Item 4 - Submission of Matters to a Vote of Security
Holders" for more information regarding this proxy statement and the special
meeting.

After this shareholder meeting concluded, Canton continued to provide
consulting services to the Company via its wholly owned subsidiary, Canton
Financial Services Corporation, a Nevada corporation ("CFSC"). These services
were formally retained pursuant to a Consulting Agreement dated May 16, 1995, as
discussed above in "Item 12 - Certain Relationships and Related Transactions,
Canton." CFSC has provided the Company with office space as well as internal
record keeping, the preparation of reports required to be filed with SEC, the
negotiation of settlement of the Company's debts, and the search for a viable
merger or acquisition candidate.

On March 24, 1995, the Company issued 115,000 shares of its Class B
Common Stock to CFSC for substantial services Canton rendered in relation to the
shareholder meeting after the completion of the proxy statement on February 18,
1995, until March 24, 1995. On July 31, 1995, the Company issued 342,931 shares
of its Class A Common stock to CFSC for consulting fees owed. These two
issuances settled outstanding consulting fees from December 16, 1994, through
July 31, 1995, for the amount of $171,4665. When these 342,931 shares were
issued to CFSC, the Company overlooked the 1,612,000 shares of compensation CFSC
received for its services rendered from December 16, 1994, through February 18,
1995. Consequently, CFSC was compensated twice for its services rendered during
this period, which amounted to $64,7543. This credit amount has been applied to
the current balance owed to CFSC. As of November 30, 1995, CFSC incurred
$267,702 in consulting fees and miscellaneous expenses on behalf of the Company,
of which $31,483 is outstanding and due.
<PAGE>

By way of a Letter Agreement dated July 7, 1995, the parties to the
Settlement Agreement modified certain terms of December 1994 Settlement
Agreement to include, among other terms, the issuance of certain shares of the
Company's common stock to Messrs. Friedman and Johnson. The Company agreed to
use its best efforts to register said shares (as well as all shares issued to
Messrs. Ira Friedman, Lawrence Friedman and Richard Johnson pursuant to
paragraph 1(b)(v) of the Settlement Agreement) on Form S-8.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits. Exhibits required to be attached and filed by Item 601 of
Regulation S-B are listed in the Index to Exhibits on page 49 of this Form
10-KSB and are incorporated herein by this reference.

(b) Reports on Form 8-K. The Company filed the following four reports on Form
8-K during the period for which this report is being filed:

December 16, 1994 - Changes in Control of Registrant
January 16, 1995 - Changes in Registrant's Certifying Accountant
February 6, 1995 - Amendment of January 16, 1995 Form 8-K
March 8, 1995 - Amendment of February 6, 1995 Form 8-K

The above mentioned Current Reports on Form 8-K are hereby incorporated by this
reference.

[THIS SPACE HAS BEEN INTENTIONALLY LEFT BLANK]

<PAGE>

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized, this 1st day of December 1995.

Bria Communications Corp.

/s/ Richard Lifschutz
Richard Lifschutz, President

In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.

Signature Title Date

/s/ Richard Lifschutz President and Director December 27, 1995
Richard Lifschutz

/s/ Jane Zheng Director, Secretary December 27, 1995
Jane Zheng and Treasurer

/s/ James Tilton Chief Executive Officer, December 27, 1995
James Tilton Director

<PAGE>

INDEX TO EXHIBITS

EXHIBIT PAGE DESCRIPTION
NO. NO.

3a * Certificate of Incorporation of the Company.
(Incorporated herein by reference from exhibit of
like number with the Company's Form 10-KSB for the
year ended December 31, 1988.)

3b * By-Laws of the Company. (Incorporated herein by
reference from exhibit of like number with the
Company's Form 10-KSB for the year ended December
31, 1988.)

4a * Warrant issued December 31, 1986 by the Company
to Mid-Monmouth Realty Associates (Incorporated
herein by reference from exhibit of like number
with the Company's Form 10-KSB for the year ended
December 31, 1988.)

10(i) *Exhibits

MATERIAL CONTRACTS

10(i)(a) * Letter of Agreement dated March 1, 1995 between the
Company and Richard Lifschutz. Incorporated herein
by reference from exhibit of like number from the
Company's Annual Report on Form 10-KSB filed by the
Company on December 28, 1995).

10(i)(b) * Settlement Agreement dated December 16, 1994
between the Company, Richard T. Johnson, Ira
Freidman, A-Z Professional Consultants and The
Canton Industrial Corporation. (Incorporated herein
by reference from exhibit of like number from the
Company's Annual Report on Form 10-KSB filed by
the Company on December 28, 1995).

10(i)(c) * Consulting Agreement dated August 4, 1995, but
made effective March 1, 1995, between the Company
and East-West Trading Corporation.(Incorporated
herein by reference from exhibit of like number from
the Company's Annual Report on Form 10-KSB filed by
the Company on December 28, 1995).

10(i)(d) * Consulting Agreement dated August 4, 1995, but
made effective March 1, 1995, between the Company
and Karston Electronics, Ltd. (Incorporated herein
by reference from exhibit of like number from the
Company's Annual Report on Form 10-KSB filed by
the Company on December 28, 1995).

10(i)(e) * Consulting Agreement dated May 16, 1995, but
effective February 18, 1995, between the Company and
Canton Financial Services Corporation. (Incorporated
herein by reference from exhibit of like number
from the Company's Annual Report on Form 10-KSB
filed by the Company on December 28, 1995).

10(i)(f) * Letter of Agreement and Settlement of All Claims
dated July 7, 1995, amending the Settlement agreement
dated December 16, 1994, between the Company, The
Canton Industrial Corporation, A-Z Professional
Consultants, Inc., Ira L. Friedman and Richard T.
Johnson. (Incorporated herein by reference from
exhibit of like number from the Company's Annual
Report on Form 10-KSB filed by the Company on
December 28, 1995).

10(i)(g) * Amendment to Letter of Agreement, Settlement of All
Claims, dated July 11, 1995, between the Company, The
Canton Industrial Corporation, A-Z Professional
Consultants, Inc., Ira L. Friedman and Richard T.
Johnson. Incorporated herein by reference from
exhibit of like number from the Company's Annual
Report on Form 10-KSB filed by the Company on
December 28, 1995).

10(i)(h) * Binding Letter of Intent between the Company and
MAXMusic, Inc. dated February 14, 1994.
(Incorporated herein by reference from Exhibit 10
to Current Report on Form 8-K filed by the Company
on March 11, 1994.) Incorporated herein by reference
from exhibit of like number from the Company's
Annual Report on Form 10-KSB filed by the Company
on December 28, 1995).

10(i)(i) 50 Stock Exchange Agreement of December 8, 1994 between
the Company and AltaChem Group, Inc.

27 * Financial Data Schedule

* These exhibits appear in the manually signed original Reports for the periods
indicated by each item and are hereby incorporated by this reference.

STOCK EXCHANGE AGREEMENT

THIS STOCK EXCHANGE AGREEMENT (the "Agreement"), dated this 8th day of
December 1995, between BRIA Communications Corp., a Utah corporation ("BRIA")
and AltaChem Group, Inc., Ireland, a corporation to be formed under the laws of
Ireland with principal offices at 268 West 400 South, Suite 300, Salt Lake City,
Utah 84101 (the "AltaChem"), Aster De-Schrijver, an individual ("De-Schrijver"),
James Tilton, an individual ("Tilton"), and all of the Shareholders of AltaChem
("ACS") (for purposes of this Agreement, BRIA, AltaChem, De-Schrijver, Tilton
and ACS may also be collectively referred to hereinafter as the "Parties").

PREMISES

WHEREAS, ACS represents that they are the legal and beneficial owners of
all of the outstanding shares of capital stock of AltaChem;

WHEREAS, ACS and BRIA desire to exchange 100% of the capital stock of
AltaChem for 75% of the issued and outstanding shares of common stock of BRIA,
all on the terms and conditions hereinafter set forth in such a manner that the
exchange will constitute a tax-free reorganization pursuant to the provisions of
Section 368(1)(B) of the Internal Revenue Code of 1986, as amended.

AGREEMENT

NOW, THEREFORE, on the stated premises, which are incorporated herein by
reference, and for and in consideration of the mutual covenants and agreements
hereinafter set forth, the mutual benefits to the Parties to be derived herein,
and for other valuable consideration, the receipt and adequacy of which are
hereby acknowledged, it is hereby agreed as follows:

1. Delivery of Shares of AltaChem. Upon the terms and subject to the
conditions set forth in this Agreement, ACS agrees to transfer and deliver
to BRIA, and BRIA agrees to acquire, all of the outstanding shares of
capital stock of AltaChem (the "Shares").

2. Consideration for Transfer of Shares. Upon the terms and subject to the
conditions set forth in this Agreement, BRIA agrees to deliver to ACS, in
full consideration of and in exchange for said shares of capital stock of
AltaChem, a number of shares of common stock, $.0001 par value, ("Common
Stock") of BRIA equivalent to 75% of all of the issued and outstanding
Common Stock of BRIA, as of the Closing date, to be delivered at the
Closing provided for in Paragraph 6 hereof. This quantity of Common Stock
shall reflect all other issuances of Common Stock as settlement of outside
debts of BRIA.

3. Miscellaneous Provisions Relating to Delivery of BRIA Common Stock.

a. No fractional shares of Common Stock of BRIA will be delivered. In the
event the ACS, or one of them, are determined to be due a fractional
share, such ACS will receive one full share instead of a fractional
portion.

<PAGE>

b. If, prior to the delivery of any of the shares of BRIA Common Stock
pursuant to Paragraph 2 hereof, BRIA shall have (1) effected one or
more subdivisions, combinations or recapitalization of its Common
Stock; (2) effected any merger, consolidation, reorganization or
business combination in which BRIA is not the surviving entity; (3)
declared or paid any dividend payable in its Common Stock; or (4) made
one or more distributions on the shares of its Common Stock in whole or
partial liquidation of BRIA, then, and in such event, the number and
kind of shares that remain to be delivered pursuant to said Paragraph 2
shall be adjusted for each such subdivision, combination,
reclassification, stock dividend, distribution, merger, consolidation,
reorganization, or business combination. The amount and type of all
such adjustments shall be such as to give each of the ACS the same
rights with respect to the BRIA shares to be delivered pursuant to said
Paragraph 2, that he would have if he had been the record holder of
said shares immediately prior to the date when such subdivision,
combination, reclassification, stock dividend, distribution, merger,
consolidation, reorganization or business combination occurred.

4. Conduct of Business Prior to Closing. From the date hereof until the time
of closing hereunder, ACS and AltaChem covenant and agree that AltaChem
shall at all times conduct its business in the usual and ordinary course
and shall not, without the written consent of BRIA:

a. Purchase, acquire, sell or otherwise dispose of any property or
services of any kind whatsoever, other than purchases and sales in the
ordinary course of business;

b. Mortgage, pledge, create security interests in or otherwise encumber
any of its properties or assets;

c. Make or incur any capital commitment or expenditure or any unusual or
long-term commitment;

d. Pay any debt, obligation or liability, absolute or contingent, except
current liabilities incurred in the ordinary course of business and
current portions of long-term liabilities;

e. Grant or pay any increase in salary or other increased compensation to
any officer, director, agent, consultant or employee;

f. Declare or pay any dividend or make any other distribution to
shareholders;

g. Reveal to third persons any trade secret, invention, customer list or
other confidential or proprietary information, or act otherwise in any
manner which may materially and adversely affect any of its rights,
interests, assets or business;

h. Issue or sell any additional stock or securities, or grant any rights
to subscribe for or to purchase, or any options or warrants for the
purchase of, any additional stock or other securities;

<PAGE>

i. Agree to settle any action or proceeding before any court or
governmental body, except for collection matters instituted or settled
in the ordinary course of business; or

j. Enter into any transaction, contract or other commitment or take any
action that would constitute a material breach of the representations,
warranties or agreements of ACS contained herein or which would
interfere with or prevent the closing provided for herein.

From the date hereof until the time of closing hereunder, ACS and
AltaChem covenant and agree that AltaChem shall duly and timely file all
reports and returns required to be filed by it with the United States
Government, the Republic of Ireland and the jurisdiction or jurisdictions
in which it is doing business; promptly pay when due all federal, state and
local taxes, assessments and government fees, charges, interests and
penalties lawfully levied or assessed upon AltaChem or any of its
properties; to the best of its ability duly observe and conform to all
lawful requirements applicable to its business; to the best of its ability
preserve its business organization intact and retain its present officers
and employees; to the best of its ability preserve the good will of its
suppliers, customers and those having business relations with it; maintain
insurance coverage now in effect on all its properties, and on all
properties for which it is responsible, and carry the same coverage of
public liability, personal injury and property damage that is now in
effect; maintain, keep and preserve all of its properties and assets in
good condition and state of repair; and meet its contractual obligations
and not become in default of any thereof.

5. Access to Books and Records. Except as hereinafter provided, BRIA and its
officers, employees and agents, shall have full access at all reasonable
times from and after the date hereof to the plants, facilities, books and
records of AltaChem and AltaChem shall cooperate fully with BRIA to the end
that it may become familiar with the properties and business of AltaChem.
BRIA agrees to treat any information that is disclosed to BRIA by AltaChem
and is proprietary or confidential to AltaChem, as confidential
information, and in the event the closing does not take place, all
documents will be returned to AltaChem and BRIA and will not make or retain
copies of any documents or make use of any confidential information
disclosed to it in the conduct of its business.

6. Closing. The closing of the exchange provided for herein shall take place
at BRIA's office at 268 West 400 South, Suite 300, Salt Lake City, Utah
84101 on the 20th day of July 1995 at 10:00 a.m., or at such other time and
place as may be mutually agreed upon by the parties hereto, such time and
date being herein referred to as the "Closing Date." At the closing, ACS
shall deliver to BRIA all certificates, assignments, and other instruments
which may be necessary, desirable, or appropriate in order to transfer to
BRIA all of the outstanding shares of capital stock of AltaChem, all in
form and substance reasonably satisfactory to counsel for BRIA. At such
closing, BRIA shall deliver to AltaChem certificates evidencing the shares
of Common Stock of BRIA to be delivered to ACS pursuant to Paragraph 2
hereof, together with such other instruments which may be necessary,
desirable, or appropriate to accomplish such transfers, all in form and
substance satisfactory to counsel for ACS.

<PAGE>

7. Representations and Warranties of ACS & AltaChem. ACS & AltaChem jointly
and severally represent and warrant to and agree with BRIA as follows:

a. Organization and Standing. AltaChem is a corporation duly organized,
validly existing and in good standing under the laws of the Republic of
Ireland, with full corporate power to carry on its business as now
being conducted and to own and operate the property and assets now
owned and operated by it, and is duly qualified to transact business
and in good standing in each jurisdiction where the ownership of its
properties or the conduct of its business requires it to be licensed or
qualified to do business. AltaChem also delivered to BRIA a copy of its
Articles of Incorporation and all amendments thereto, certified by the
appropriate official from the Republic of Ireland, and a copy of its
By-Laws as amended, certified by its Secretary, which documents shall
be complete and correct as of the date of this Agreement.

b. Subsidiaries, Etc. AltaChem has no subsidiaries and is not party to any
partnership, joint venture or similar agreement, except as disclosed in
the schedule referred to in subparagraph (f) of Paragraph 7 hereof.

c. Capital Stock. The authorized capital stock of AltaChem consists of
_____________ shares of Common Stock, $________ par value, of which
___________ shares are validly issued and outstanding. All of said
outstanding shares of AltaChem have been duly authorized and validly
issued, are fully paid and nonassessable. There are no options,
warrants or other agreements or commitments which now or may in the
future obligate AltaChem to issue or purchase any shares of its capital
stock or other securities.

d. Indebtedness. AltaChem will deliver within 180 days following the date
of this Agreement to BRIA a schedule, identified by reference to this
subparagraph, listing all promissory notes payable by AltaChem, all
agreements of AltaChem to borrow money from others, and all commitments
by others to lend money to AltaChem. As to each note, obligation to
borrow and loan commitment, such schedule accurately sets forth the
interest rate, terms of payment of principal and interest, identity of
security (if any) and any other material terms of such indebtedness.
AltaChem is not in default in any respect under, and is not otherwise
in violation or contravention of, any of the terms or provisions of any
note, loan agreement, agreement to borrow money from others or any
commitment by others to lend money.

e. Financial Statements. AltaChem will deliver to BRIA within 180 days
after the date of this Agreement, each's audited year end financial
statements for the three years prior to the execution of this Agreement
or to the time of incorporation if less than three years. Such
statements will be initialed by officers of AltaChem and BRIA for
identification. All of such financial statements are or will be
complete and fairly present the financial position of AltaChem on the
indicated dates and the results of its operations for the indicated
periods. All of such statements will be prepared in accordance with
generally accepted accounting principles consistently applied. AltaChem
will have no liabilities, whether absolute, accrued, contingent or
otherwise, other than (i) liabilities disclosed,

<PAGE>

(ii) incurred in "arms-length" transactions in the ordinary course of
business since the Balance Sheet Date and (iii) liabilities disclosed
in subparagraph (k) of this Paragraph 7 or the schedule referred to in
subparagraph (f) of this Paragraph 7.

f. Contracts and Other Commitments. AltaChem will deliver to BRIA within
180 days after the date of this Agreement a complete and accurate
schedule, identified by reference to this subparagraph, listing and
briefly describing all Material Contracts. For this purpose, the term
"Material Contracts" shall be defined to mean (i) all contracts and
commitments out of the ordinary course of business; (ii) all contracts
and commitments involving an obligation which cannot or, in reasonable
probability, will not be performed or terminated within sixty (60) days
from the date thereof; (iii) all bonus, incentive compensation,
pension, group insurance or employee welfare plans of any nature
whatsoever; (iv) all collective bargaining agreements or other
contracts or commitments to or with any labor unions or other employee
representatives or groups of employees; (v) employment contracts and
other contracts, agreements or commitments to or with individual
employees, agents or consultants extending for a period of more than
three (3) months from the date thereof or providing for earlier
termination only upon the payment of a penalty or equivalent thereof;
or (vi) all other contracts or commitments providing for payments based
in any manner upon the sales, purchases or profits of AltaChem. There
has not been any material default in any obligation to be performed by
AltaChem under any Material Contract listed on the said schedule, and
AltaChem has not waived any material right under any such Material
Contract.

g. Assets. AltaChem will deliver to BRIA within 180 days after the date of
this Agreement a complete and accurate schedule, identified by
reference to this subparagraph, containing (i) a complete list,
together with stock certificates, of all of AltaChem's ownership
interests and options to purchase ownership interests in other entities
(ii) complete legal description of all real property owned, leased or
otherwise used or occupied by it, (iii) a list of all banks and other
institutions in which it has any account or safe deposit showing the
identifying numbers and names of the persons authorized to draw thereon
or have access thereto, (iv) a list of any and all intellectual
property it owns or licenses or otherwise has legal use over and (v) a
list of all capitalized machinery, tools, equipment owned, leased or
otherwise used by it. Except as disclosed on the schedule referred to
in subparagraph (f) of this Paragraph 7, except as disclosed in the
schedule of assets supplied pursuant to this subparagraph, and except
as acquired after the date hereon on terms approved by BRIA, AltaChem
has good and marketable title to all property and assets used in its
business, including all property and assets reflected in the schedule
referred to in this subparagraph and in the Balance Sheet and all
properties and assets acquired after the Balance Sheet Date (other than
assets disposed of since the Balance Sheet Date in the ordinary course
of business), subject to no liens, mortgages, pledges, encumbrances or
charges of any kind. The machinery, equipment and other facilities of
AltaChem are in satisfactory operating condition and repair for the
business now conducted by it. Within 180 days after the date of this
Agreement, AltaChem will deliver to Buyer copies of all records,
including all signatures

<PAGE>

or authorization cards, pertaining to such safe deposit boxes and bank
accounts.

h. Litigation. Except as identified in a complete and accurate schedule,
identified by reference to this subparagraph and delivered to BRIA,
AltaChem is not engaged in or threatened with any legal action or other
proceeding before any court or administrative agency. AltaChem has not
violated any laws, regulations or order applicable to its business or
activities, and the conduct of the present business of AltaChem at the
present location is in conformity with all zoning and building code
requirements.

i. Accounts Receivable. All accounts receivable of AltaChem, whether or
not reflected in the Balance Sheets or the Interim Balance Sheet,
represent sales actually made in the ordinary course of business, and
are current and collectible net of any reserves shown on the Balance
Sheets or the Interim Balance Sheet (which reserves are adequate and
were calculated consistent with past practice). Subject to such
reserves, each of the accounts receivable has been collected in full or
will be collected in full, without any setoff, within ninety days after
the day on which it first becomes due and payable.

j. Inventories. All inventory of AltaChem, whether or not reflected in the
Balance Sheets or the Interim Balance Sheet, consists of a quality and
quantity usable and salable in the ordinary course of business, except
obsolete items and items of below-standard quality, all of which have
been written off or written down to net realizable value in the Balance
Sheets or the Interim Balance Sheet. All inventories not written off
have been recorded at the lower of average cost or market. The
quantities of each type of inventory (whether raw materials,
work-in-process, or finished goods) are not excessive, but are
reasonable and warranted in the present circumstances of AltaChem. All
work in process and finished goods inventory is free from any defect or
other deficiency.

k. Purchase Commitments and Outstanding Bids. No purchase commitment of
AltaChem is in excess of normal, ordinary and usual requirements of its
business, or was made at any price in excess of the then current market
price, or contains terms and conditions more onerous than those usually
and customary in the industry. In the aggregate, the outstanding bids,
sales proposals, contracts or unfilled orders of AltaChem (i) will not
(based on today's costs and reasonably foreseeable increases in such
costs) require AltaChem to supply goods or services at cost to AltaChem
in excess of the revenues to be received therefrom, and (ii) quote
prices which include a markup over reasonably estimated costs
consistent with past markups on similar business.

l. Title to AltaChem Stock. Each ACS represents and warrants for himself
and not for the others: that this Agreement has been duly executed and
delivered by him and is, as to him, a valid agreement binding upon him
in accordance with its terms; that he individually has valid title to
the shares of capital stock of AltaChem set forth opposite his name in
Exhibit "A" hereto, with full right, power and authority to transfer,
sell and deliver such shares pursuant to this Agreement; and that, upon
delivery of his shares pursuant to this Agreement, BRIA will receive
valid and marketable title to his shares, free and clear of all voting
or other trust arrangements, liens, encumbrances, restrictions,

<PAGE>

and adverse claims, whether existing or contingent.

The schedules referred to in this Paragraph 7 will be delivered to BRIA on
or prior to 180 days after the date of this Agreement. In the event that, after
a review of the contents of such schedules and the documents listed or described
therein, BRIA determines in its sole discretion that the contents of such
schedules, or the documents referred to therein or the obligations under such
documents are unacceptable to BRIA, BRIA may terminate this Agreement without
any liability on its part whatsoever by giving written notice of such
termination to AltaChem and ACS on or before 210 days after the date of this
Agreement.

8. Representations and Warranties of BRIA. BRIA represents and warrants to and
agrees with AltaChem as follows:

a. Organization and Standing. BRIA is a corporation duly organized, and
will be validly existing and in good standing under the laws of the
State of New Jersey upon its resolution of its outstanding sales and
gross income tax balances, and will then have full corporate power to
carry on its business as now being conducted and to own and operate the
property and assets now owned and operated by it, and be duly qualified
to transact business and in good standing in each jurisdiction where
the ownership of its properties or the conduct of its business requires
it to be licensed or qualified to do business.

b. Capital Stock. The authorized capital stock of BRIA consists of:
200,000,000 shares of Class A Common Stock, $0.001 par value, 220,000
shares of Class B Common Stock, $0.001 par value. 2,281,424 shares of
Class A Common Stock and 220,000 shares of Class B Common Stock were
issued and outstanding at the close of business on July 11, 1995. All
of said outstanding shares are validly issued, fully paid and
non-assessable.

c. Validity of Shares. The shares of Common Stock to be delivered by BRIA
pursuant to this Agreement will, when so delivered, be validly issued
and outstanding, fully paid and non-assessable.

d. Changes, Dividends, Etc. Prior to the closing hereunder, BRIA will not
split, combine or otherwise change or reclassify its outstanding Common
Stock or declare or distribute any cash or stock dividend upon such
Common Stock.

e. Authorization of Agreement. BRIA's board of directors has duly
authorized the execution, delivery and performance of this Agreement by
BRIA have been duly authorized by its Board of Directors, and will not
result in any breach of or violate or constitute a default under its
Articles of Incorporation or By-Laws or any indenture, mortgage or
other agreement or instrument to which it is a party.

f. No Violation of Law, Etc. Neither the execution nor the delivery of
this Agreement by BRIA, nor the performance of any of its obligations
hereunder will result in a breach or violation of any law, order, rule,
regulation, writ, injunction or decree or any

<PAGE>

governmental instrumentality or court having jurisdiction over BRIA or
any of its assets or rights, or result in the creation or imposition of
any lien, charge or encumbrance of any kind whatever on any of such
assets or rights.

g. Financial Statements. BRIA has delivered to AltaChem its reports on
Forms 10-QSB and 10-KSB for the past two years which contains a
consolidated balance sheet as of December 31, 1994, and the related
statement of consolidated income for the year then ended. Such
financial statements have been initialed by officers of BRIA and
AltaChem for identification. Such financial statements are complete,
have been prepared in accordance with generally accepted accounting
principles consistently applied and fairly present the consolidated
financial position of BRIA at such date, and the results of its
operations for the period therein specified.

9. Conditions to Obligations of BRIA. The obligations of BRIA under this
Agreement are subject to the fulfillment, at or prior to the Closing Date,
of the following conditions precedent:

a. All representations and warranties of ACS and AltaChem contained herein
and in any certificate or other investment delivered pursuant to the
provisions hereof, or in connection with the transactions contemplated
hereby, shall be true on the Closing Date with the same force and
effect as though such representations and warranties had been made on
the Closing Date.

b. ACS and AltaChem shall have performed and complied with all of the
terms, covenants and conditions of this Agreement to be performed or
complied with by them, respectively, on or before the Closing Date.

c. The directors of AltaChem shall have taken all necessary action to
authorize the execution and performance of this Agreement, and AltaChem
shall have delivered to BRIA true and complete copies, certified by the
Secretary, of resolutions of its Board of Directors evidencing such
action.

d. ACS and AltaChem shall have delivered to BRIA such certificates dated
as of the Closing Date, certifying in such detail as BRIA may
reasonably request the fulfillment of the conditions specified in this
Paragraph 9. No legend or other reference to any purported Encumbrance
appears upon any certificate. The delivery of certificates to BRIA
provided in Paragraph 2 will result in BRIA's immediate acquisition of
record and beneficial ownership of the Shares, free and clear of all
Encumbrances (which term shall be hereinafter defined as any security
interest, mortgage, lien, charge, adverse claim or restriction of any
kind, including, but not limited to, any restriction on the use,
voting, transfer, receipt of income or other exercise of any attributes
of ownership).

e. AltaChem shall have delivered to BRIA an opinion of its counsel for ACS
and AltaChem, dated within 180 days of this Agreement, to the effect
that the terms of Paragraph 7 herein have been complied with and are in
fact accurate. In rendering such

<PAGE>

opinion, such counsel may rely on certificates of public officials and
upon certificates of officers of AltaChem and ACS and upon opinions of
counsel retained by AltaChem or ACS in states other than Florida,
copies of which certificates and opinions shall be furnished to BRIA.

f. No action or proceeding by any governmental body or agency shall have
been threatened, asserted or instituted to restrain or prohibit the
carrying out of the transactions contemplated by this Agreement.

g. All corporate and other proceedings and action taken in connection with
the transactions contemplated by this Agreement and all certificates,
opinions, agreements, instruments and documents mentioned in this
Paragraph 9 or incident to any such transaction shall be reasonably
satisfactory in form and substance to BRIA and to its counsel.

The conditions contained in this Paragraph 9 are included herein for the
benefit of BRIA and, without constituting a waiver of any of its rights
hereunder, may be waived, in whole or in party, by BRIA.

10. Conditions to Obligations of AltaChem and ACS. The obligations of AltaChem
and ACS under this Agreement are subject to the fulfillment, on or before
the Closing Date, of the following conditions:

a. All representations and warranties of BRIA contained herein and in any
certificate or other instrument delivered pursuant to the provisions
hereof, or in connection with the transactions contemplated hereby,
shall be true on the Closing Date with the same force and effect as
though such representations and warranties had been made on the Closing
Date.

b. BRIA shall have performed and complied with all of the terms, covenants
and conditions of this Agreement to be performed or complied with by it
on or before the Closing Date.

c. BRIA shall have delivered to ACS a certificate of its President or a
Vice President and its Secretary or an Assistant Secretary, dated as of
the Closing Date, certifying in such detail as ACS may reasonably
request the fulfillment of the conditions specified in this Paragraph
10.

d. The Board of Directors of BRIA shall have taken all necessary action to
authorize the execution and performance of this Agreement, including
the delivery of shares of Common Stock of BRIA to ACS in accordance
with this Agreement, and BRIA shall have delivered to ACS true and
complete copies certified by its Secretary or Assistant Secretary, of
resolutions of its Board of Directors evidencing such action.

e. No action or proceeding by any governmental body or agency shall have
been

<PAGE>

threatened, asserted or instituted to restrain or prohibit the carrying
out of the transactions contemplated by this Agreement.

f. All corporate and other proceedings and actions taken in connection
with the transactions contemplated hereby and all certificates,
opinions, agreements, instruments and documents mentioned in this
Paragraph 10 or incident to any such transaction shall be satisfactory
in form and substance to ACS and their counsel.

The conditions contained in this Paragraph 10 are included herein for the
benefit of ACS and, without constituting a waiver of any of its rights
hereunder, may be waived, in whole or in part, by ACS.

11. Certain Covenants Prior to Closing.

a. ACS will use their best efforts, and take such other action as may be
necessary, to fulfill all of the conditions contained in Paragraph 9
hereof and to authorize and consummate, and cause AltaChem to authorize
and consummate, all of the transactions herein contemplated.

b. BRIA will use its best efforts, and take such other action as may be
necessary, to fulfill all of the conditions contained in Paragraph 10
hereof and to authorize and consummate all of the transactions herein
contemplated.

c. Between the date of this Agreement and the Closing Date, AltaChem and
ACS shall (a) give BRIA and its authorized representatives full access
to all offices, warehouses and other facilities and properties of
AltaChem and to the books and records of AltaChem (and permit BRIA to
make copies thereof), (b) permit BRIA to make inspections thereof, and
(c) cause its officers and its advisors (including, without limitation,
its auditors, attorneys, financial advisors and other consultants,
agents and advisors) to furnish BRIA with such financial and operating
data and other information with respect to the business and properties
of AltaChem, and to discuss with BRIA and its authorized
representatives the affairs of AltaChem, all as BRIA may from time to
time reasonably request.

d. Between the date of this Agreement and the Closing Date, AltaChem and
ACS shall give notice to BRIA promptly upon AltaChem or ACS becoming
aware of (a) any inaccuracy of a representation or warranty set forth
in any schedule or (b) any event or status of facts that, if it had
occurred or existed on or prior to the date of this Agreement, would
have caused any such representation and warranty to be inaccurate, with
such notice to describe such inaccuracy, event or status of facts in
reasonable detail.

e. Between the date of this Agreement and the Closing Date, AltaChem and
ACS shall cause (a) copies of all reports and other documents given to
the members of the Board of Directors (or any committee thereof) of
AltaChem to be delivered to BRIA at the

<PAGE>

same time and (b) copies of the minutes of all meetings of, and actions
taken without a meeting by, the Board of Directors (or any committee
thereof) of AltaChem to be delivered to BRIA promptly after the
preparation thereof. Between the date of this Agreement and the
Closing, AltaChem and ACS shall give BRIA at least 3 days prior notice
of any meeting of or action to be taken without a meeting by, the Board
of Directors or committee thereof of AltaChem and shall cause AltaChem
to permit one individual designated by BRIA to attend each such meeting
as an observer.

f. Between the date of this Agreement and the Closing Date, BRIA, AltaChem
and ACS shall discuss and coordinate with respect to any public filing
or announcement concerning any of the contemplated transactions.

g. BRIA and ACS shall cause AltaChem to, (a) file with applicable
regulatory authorities the applications and related documents required
to be filed by them (and prosecute diligently any related proceedings)
in order to consummate the contemplated transactions and (b) cooperate
with the others as they may reasonably request in connection with the
following.

12. Survival of Representations and Warranties; Indemnification.

a. Survival. All representations, warranties and agreements contained in
this Agreement shall survive the Closing notwithstanding any
investigation conducted with respect thereto; however, a party shall
have no liability with respect to a representation and warranty, or an
agreement to be performed or complied with prior to the Closing Date,
to the extent that the inaccuracy of such representation and warranty
or the failure to perform and comply with such agreement was not
intentional and was disclosed in a schedule delivered pursuant to this
Agreement.

b. Time Limitations. If the Closing occurs, BRIA and ACS shall have no
liability with respect to any representation or warranty, or agreement
to be performed and complied with prior to the Closing Date, other than
those set forth in Paragraphs 4, 7, and 9, unless on or before 210 days
after the date of this Agreement, BRIA, AltaChem or ACS are given
notice asserting a claim with respect thereto and specifying the
factual basis of that claim in reasonable detail to the extent then
known by BRIA. The representations, warranties and agreements in
paragraphs 4, 7 and 9 shall survive the Closing of this Agreement. If
the Closing occurs, BRIA shall have no liability with respect to any
representation or warranty, or agreement to be performed and complied
with prior to the Closing Date, unless on or before 210 days after the
date of this Agreement, BRIA is given notice of a claim with respect
thereto and specifying the factual basis of that claim in reasonable
detail to the extent then known by AltaChem or ACS.

c. Indemnification by AltaChem and ACS. AltaChem and ACS, jointly and
severally, shall indemnify and hold harmless BRIA, and shall reimburse
BRIA for any loss, liability, claim, damage, expense (including, but
not limited to, costs of investigation and defense and reasonable
attorneys' fees) or diminution of value (collectively

<PAGE>

"Damages") arising from or in connection with (a) any inaccuracy in any
of the representations and warranties of AltaChem or ACS in this
Agreement, or any actions, omissions or state of facts inconsistent
with any such representation or warranty, (b) any failure by AltaChem
or ACS to perform or comply with any agreement in this Agreement, (c)
any claim by any person for brokerage or finder's fees or commissions
or similar payments based upon any agreement or understanding alleged
to have been made by any such person with AltaChem or any Shareholder
(or any person acting on their behalf) in connection with any of the
contemplated transactions.

d. Indemnification by BRIA. BRIA shall indemnify and hold harmless
AltaChem and ACS, and shall reimburse AltaChem and ACS for, any Damages
arising from or in connection with (a) any inaccuracy in any of the
representations and warranties of BRIA in this Agreement, or any
actions, omissions or state of acts inconsistent with any such
representation or warranty, (b) any failure by BRIA to perform or
comply with any agreement in this Agreement, or (c) any claim by any
person for brokerage or finder's fees or commissions or similar
payments based upon any agreement or understanding alleged to have been
made by such person with BRIA (or any person acting on its behalf) in
connection with any of the contemplated transactions.

e. Notwithstanding anything hereinabove contained to the contrary in this
Paragraph 12, (i) none of the provisions of this Paragraph 12 shall
apply to any liability (whether by BRIA to one or more of ACS or by one
or more ACS to BRIA) arising out of or by virtue of the Provisions of
Paragraph 13 below or any violation of the provisions of Paragraph 13,
and (ii) the provisions of said Paragraph 13 shall survive the Closing
Date.

13. Investment Representation. Each ACS acknowledges his understanding that
the shares of BRIA Common Stock to be delivered pursuant to this
Agreement will not be registered pursuant to the 1933 Act and each ACS
further represents to and agrees with BRIA as follows:

a. Each ACS is acquiring the shares of BRIA Common Stock pursuant to this
Agreement for his own private personal investment account and with no
present intention of reselling or distributing such shares or any
portion thereof to others.

b. Each ACS fully comprehends that in connection with the issuance of
shares of BRIA Common Stock pursuant to this Agreement, BRIA is relying
to a material degree on the representations, warranties and covenants
contained herein, and with such realization he authorizes BRIA to act
as it may see fit in full reliance hereon.

c. Each ACS agrees that none of such shares will be transferred or
distributed unless (i) they are covered by an effective Registration
Statement prepared in accordance with the 1933 Act and are distributed
in a manner complying with the 1933 Act and with the Rules and
Regulations promulgated thereunder; or (ii) they may be transferred in
accordance with Rule 144 of the Rules and Regulations pursuant to the
1933 Act (or such similar Rule as may be applicable to such shares at
the time of transfer) so long as

<PAGE>

such transfer strictly complies with said Rule 144 and with such
procedures as BRIA may reasonably establish in connection therewith; or
(iii) there is first delivered to BRIA the written legal opinion of
legal counsel in form and substance reasonably satisfactory to BRIA's
legal counsel or a "no action letter" from the SEC indicating that any
of the provisions of the 1933 Act and the Rules and Regulations
promulgated thereunder. In the event such legal opinion is based upon
the exemption now contained in Section 4(2) of the 1933 Act, the person
acquiring the shares or some portion thereof shall execute and deliver
to BRIA a letter agreement complying with the 1933 Act and the Rules
and Regulations promulgated thereunder.

d. Each ACS hereby agrees that the certificate(s) representing such shares
may bear a legend, as set forth below, setting forth the restrictions
upon transfer which are contained in the foregoing subparagraph (c) and
that BRIA may deliver to its transfer agent a "stop transfer order"
directing the transfer agents not to effect any transfer of such shares
without having received the written permission of BRIA and evidence of
compliance with applicable provisions of the 1933 Act and the terms of
this Agreement.

The shares represented by this certificate have not been
registered under the Securities Act of 1933 (the "Act") and are
"restricted securities" as that term is defined in Rule 144 under
the Act. The shares may not be offered for sale, sold or otherwise
transferred except pursuant to an effective Registration Statement
under the Act or pursuant to an exemption from registration under
the Act, the availability of which is to be established to the
satisfaction of BRIA.

e. Each ACS hereby agrees to indemnify BRIA against and hold it harmless
from all losses, liabilities, costs and expenses (including reasonable
attorneys' fees) which shall arise as a result of a sale or
distribution by him of such shares or any portion thereof in violation
of the 1933 Act or the terms of this Agreement.

14. Brokers and Finders. ACS represents to BRIA and BRIA represents to ACS
that other than Canton Financial Services Corporation ("Canton"), no
person, firm or corporation has been requested, authorized or employed
by AltaChem, BRIA or any of the ACS to act as finder, broker or agent
in connection with the subject matter of this Agreement or negotiations
leading thereto. In consideration for Canton's services in introducing
the Parties, BRIA and AltaChem agree that BRIA shall deliver to Canton,
in full consideration of and in complete discharge of Canton's finder's
fee, a number of shares of Common Stock of BRIA equivalent to 5% of all
of the issued and outstanding Common Stock of BRIA, as of the Closing
date, to be delivered at the Closing provided for in Paragraph 6
hereof. This quantity of Common Stock shall reflect all other issuances
of Common Stock as settlement of outside debts of BRIA.

15. Further Assurances.

a. At the request of BRIA, and without further consideration, AltaChem and
ACS will

<PAGE>

execute and deliver such additional instruments of transfer and will
take such other action as BRIA reasonably may request in order more
effectively to transfer to BRIA full ownership and control of AltaChem.

b. At the request of one or more of ACS, and without further
consideration, BRIA will execute and deliver such additional
instruments and will take such other actions as ACS may reasonably
request in order more effectively to carry out the transaction
contemplated hereby.

16. Expenses. AltaChem shall bear all out-of-pocket expenses arising from
this Agreement, including but not limited to, travel, lodging, filing
fees, printing, postage, delivery, shipping, copying, telephone calls,
overnight packages, facsimiles, and other related expenses.

17. Employees of AltaChem. BRIA agrees to maintain the employment of all of
AltaChem's employees in their present positions, with the same salary
and seniority.

18. Directors. All directors of AltaChem whose resignations shall have been
requested by BRIA not less than five days before the Closing Date shall
have submitted their resignations or been removed effective as of the
Closing Date. De-Schrijver and Tilton shall have been appointed as
directors of BRIA prior to or on the Closing Date.

19. Other Matters.

a. No Other Agreements. All terms and conditions of this Agreement are set
forth herein, and there are no warranties, agreements or
understandings, express or implied, except those expressly set forth
herein.

b. Amendment. This Agreement may be amended only by a written instrument
executed on behalf of BRIA, AltaChem and ACS; provided, however, that
after the closing provided for herein BRIA and ACS may amend this
Agreement without the execution or approval of AltaChem.

c. Notices. Any notice or other communication required or permitted to be
given hereunder shall be deemed properly given if personally delivered
or deposited in the United States mail, registered or certified and
postage prepaid, addressed to AltaChem or ACS at 82-66 Austin Street,
Kew Gardens, NY 11415 or to BRIA at 268 West 400 South, Suite 300, Salt
Lake City, UT 84101, or at such other addresses as may from time to
time be designated by the respective parties in writing.

d. Specific Performance. The parties acknowledge that the subject matter
of this Agreement (i.e., the business and assets of AltaChem) is unique
and that no adequate remedy of law would be available for breach of
this Agreement. Accordingly, each party agrees that the other parties
will be entitled to an appropriate decree of specific performance or
other equitable remedies to enforce this Agreement (without any bond

<PAGE>

or other security being required) and each party waives the defense in
any action or proceeding brought to enforce this Agreement that there
exists an adequate remedy at law.

e. Termination.

i. Termination for Default. Without prejudice to other rights and
remedies which a party may have, either party may by notice to the
other given on or at any time prior to the Closing Date terminate
this Agreement if default should be made by the other party in the
observance or in due and timely performance of any of its
covenants and agreements herein contained and if such default
shall not have been fully cured within fifteen (15) days after
receipt of such notice specifying with particularity such default.

ii. Termination for Delay. Without prejudice to other rights and
remedies which a party may have, if the closing shall not have
occurred by December 31, 1995, at 5:00 p.m., Eastern Standard Time
a party who is not then in default in the observance or in the due
and timely performance of any of its covenants and agreements
herein contained, may at any time thereafter terminate this
Agreement by giving written notice of such termination to the
other party.

iii. Termination for Non-compliance. BRIA shall have the right to
terminate this Agreement if it is determined at any time that
AltaChem's financial statements are not, as of the Closing Date,
in conformity with the requirements of Paragraph 7(e) herein.

f. Assignment. Except as specifically permitted by the terms of this
Agreement, neither this Agreement nor any right created hereby shall be
assignable by BRIA. AltaChem or ACS (or their respective successors in
interest) without the prior written consent of all other parties
hereto, and any such attempted assignment shall be void. Nothing in
this agreement, expressed or implied, is intended to confer upon any
person, other than the parties hereto, any rights or remedies under or
by reason of this Agreement. Notwithstanding any other provisions
herein to the contrary, the right of each of ACS to receive shares of
BRIA Common Stock pursuant to Paragraph 2 herein shall not be
assignable except upon the death of such Shareholder by testamentary
disposition or the law of intestate succession.

g. Paragraphs and Other Headings. Paragraphs or other headings contained
in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.

h. Choice of Law. It is the intention of the parties that the laws of the
State of Utah should govern the validity of this Agreement, the
construction of its terms and the interpretation of the rights and
duties of the parties.

<PAGE>

i. No Waiver. The failure of any party to insist upon strict adherence to
any term of this Agreement on any occasion shall not be considered a
waiver or deprive that party of the right thereafter to insist upon
strict adherence to that term or any other term of this Agreement. Any
waiver must be in writing.

j. Severability. In the event that any one or more of the provisions
contained in this Agreement shall for any reason be held to be invalid,
illegal or unenforceable, the same shall not affect any other
provisions of this Agreement, but this Agreement shall be construed as
if such invalid, illegal or unenforceable provisions had never been
contained herein.

k. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.

BRIA Communications Corp. AltaChem Group, Inc., Ireland

/s/ Richard Lifshutz /s/ James Tilton
Richard Lifschutz, President By: James Tilton
Title: President
ACS
James Tilton

/s/ Aster De-Schrijver
By: Aster De-Schrijver /s/ James Tilton
Title: Authorized Representative James Tilton

Aster De-Schrijver

/s/ Aster De-Schrijver
Aster De-Schrijver