<PAGE> 1
U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[ X ] Quarterly Report Under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended: March 31, 1996
[ ] Transition Report Under Section 13 or 15(d) of the Exchange Act
Commission File Number: 33-19980-D
Gemstar Enterprises, Inc.
(Exact name of small business issuer as specified in its charter)
Nevada 87-0450450
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
73-251 Amber Street
Palm Desert, California 92260
(Address of principal executive offices)
619 - 346 - 4812
(Issuer's telephone number)
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.
(1) Yes [ ] No [ X ] (2) Yes [ X ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the Issuer's classes of
common equity; as of the latest practical date: 10,758,614 shares of its
$0.001 par value common stock as of November 5, 1996.
Transitional Small Business Disclosure Format (check one) Yes [ ] No [ X ]
<PAGE>
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following unaudited financial statements included as a part of this Form
10-QSB Report for the second quarter ended March 31, 1996, have been prepared
by the Company pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. However, in the
opinion of management, all adjustments (which include only normal recurring
accruals) necessary to present fairly the financial position, results of
operations, cash flows and stockholders' equity for the periods presented have
been made. These financial statements should be read in conjunction with the
accompanying notes, and with the historical financial statements and footnotes
thereto and other information contained in the Company's most recent report
on form 10-KSB.<PAGE>
<PAGE> 3
Gemstar Enterprises, Inc.
(A Development Stage Company)
Balance Sheet
March 31, 1996
[Unaudited]
ASSETS
Current Assets:
Cash in bank $ 2,010
-----------
Total Current Assets $ 2,010
-----------
TOTAL ASSETS $ 2,010
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 333
Loans from officers 665
-----------
Total Current Liabilities $ 998
-----------
Stockholders' Equity:
Preferred Stock, none outstanding $ -0-
Common Stock, 6,758,614 shares outstanding 6,759
Additional paid-in capital 908,285
Deficit accumulated prior to the development stage <905,548>
Deficit accumulated during the development stage <8,484>
-----------
Total Stockholders' Equity $ 1,012
-----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,010
===========
The accompanying notes are an integral part of these financial statements.
<PAGE> 4
Gemstar Enterprises, Inc.
(A Development Stage Company)
Statements of Operations
[Unaudited]
<TABLE>
<CAPTION>
From the Date
of Inception
as a Development
Stage Company
For the Three Month For the Six Month (April 10, 1993)
Period Ended Period Ended Through
March 31, March 31, March 31,
1996 1995 1996 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Revenue $ -0- $ -0- $ -0- $ -0- $ -0-
-------- ------- ------- ------- -------
Expenses:
Office Supplies $ 18 $ -0- $ 61 $ -0- $ 61
Filing Fees -0- 300 300 300 1,267
Cost of public entity 360 -0- 360 -0- 940
Travel 268 -0- 268 -0- 281
Taxes, non-income -0- -0- -0- -0- 127
Impairment of assets 5,396 -0- 5,396 -0- 5,396
Amortization -0- -0- -0- -0- 412
------- ------- ------- ------- -------
Total Expenses $ 6,042 $ 300 $ 6,385 $ 300 $ 8,484
------- ------- ------- ------- -------
NET LOSS $<6,042> $ <300> $<6,385> $ <300> $<8,484>
======= ======= ======= ======= =======
NET LOSS PER SHARE $ <0.00> $ <0.00> $ <0.00> $ <0.00> $ <0.00>
======= ======= ======= ======= =======
Common Shares used in
Net Loss Computation 6,758,614 6,758,614 6,758,614 6,758,614 6,758,614
========= ========= ========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 5
Gemstar Enterprises, Inc.
(A Development Stage Company)
Statement of Stockholders' Equity
[Unaudited]
<TABLE>
<CAPTION>
Deficit Deficit
Accum. Accum. Total
Prior to the During the Due Stockholders'
Common Stock Paid-in Development Development From Equity
Shares Amount Capital Stage Stage Officer <Deficit>
------ ------ ------- ------------ ------------ ------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at inception
of Development Stage
April 10, 1993 1,698,864 $ 1,699 $812,150 $<905,548> $ -0- $ -0- $<91,699>
Common stock valued
at $.02 per share
for assumption of
liabilities, amounts
due shareholder and
receivable from
officer
August 16, 1993 5,000,000 5,000 95,000 -0- -0- <7,783> 92,217
Net Loss from the
start of the
Development Stage
to September 30, 1993 -0- -0- -0- -0- <1,300> -0- <1,300>
--------- ------- ------- -------- ------- ------- --------
Balance,
September 30, 1993 6,698,864 $ 6,699 $907,150 $<905,540> $<1,300> $<7,783> $ <612>
Expenses paid by
officer -0- -0- -0- -0- -0- 966 966
Net Loss for the
year ended,
September 30, 1994 -0- -0- -0- -0- <354> -0- <354>
--------- ------- ------- -------- ------- ------- --------
Balance,
September 30, 1994 6,698,864 $ 6,699 $907,150 $<905,540> $<1,484> $<6,817> $ -0-
Common stock issued
for cash at $.02 per
share
October 15, 1994 59,750 60 1,135 -0- -0- -0- -0-
Loan to officer -0- -0- -0- -0- -0- <1,195> <1,195>
Expenses paid by
officer -0- -0- -0- -0- -0- 615 615
Collection of loan
from officer
September 30, 1995 -0- -0- -0- -0- -0- 7,397 7,397
Net Loss for the
year ended,
September 30, 1995 -0- -0- -0- -0- <615> -0- <615>
--------- ------- ------- -------- ------- ------- --------
Balance,
September 30, 1995 6,758,614 $ 6,759 $908,285 $<905,540> $<2,099> $ -0- $ 7,397
Net Loss for the
six month period,
March 31, 1996 -0- -0- -0- -0- <6,385> -0- <6,385>
--------- ------- ------- -------- ------- ------- --------
Balance,
March 31, 1996 6,758,614 $ 6,759 $908,285 $<905,540> $<8,484> $ -0- $ 7,054
========= ======= ======== ========= ======= ======= ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 6
Gemstar Enterprises, Inc.
(A Development Stage Company)
Statements of Cash Flows
[Unaudited]
<TABLE>
<CAPTION>
From the Date
of Inception
as a Development
Stage Company
(April 10, 1993)
For the Six Month Period Through
Ended March 31, March 31,
1996 1995 1996
---- ---- ----
<S> <C> <C> <C>
Cash Flows from
Operating Activities:
Net Loss from Operations $ <6,385> $ <300> $ <8,484>
Amortization -0- -0- 412
Expenses paid by officer -0- -0- 1,581
Increase <Decrease> in
accounts payable 333 -0- <279>
-------- -------- --------
Net Cash Used In
Operating Activities $ <6,052> $ <300> $ <6,770>
-------- -------- --------
Cash Flows from
Financing Activities:
Proceeds from sale of
common stock $ -0- $ 1,195 $ 1,195
Advances from officer 62 300 665
Collection of receivable
from officer -0- -0- 7,397
Advances to officer -0- <1,195> <1,195>
-------- -------- --------
Net Cash Provided by
Financing Activities $ 62 $ 300 $ 8,062
-------- -------- --------
Net Increase <Decrease> In Cash $ <5,990> $ -0- $ 1,292
Cash at beginning of period 8,000 -0- 718
-------- -------- --------
Cash at end of period $ 2,010 $ -0- $ 2,010
======== ======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 7
Gemstar Enterprises, Inc.
(A Development Stage Company)
Notes to Financial Statements
[Unaudited]
NOTE 1 - ACCOUNTING POLICIES AND OTHER DISCLOSURES
The condensed financial statements included in this Form 10-QSB Report have
been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. These financial
statements have been prepared in the ordinary course of business for the
purpose of providing information with respect to the interim three and six
month periods ended March 31, 1996 and 1995, and are not necessarily
indicative of the results to be expected for the entire year. The accounting
policies followed by the Company and other pertinent footnote disclosures are
set forth in the Company's audited financial statements contained in its Form
10-KSB Report.
The loss per common share has been computed using the number of common shares
outstanding as of the end of the latest period presented. Inasmuch as the
Company is a development stage enterprise, using the number of common shares
outstanding as of March 31, 1996, rather than the weighted average number of
common shares outstanding during each of the periods presented, provides a
more conservative approach to the loss per share computation.
NOTE 2 - CHANGE IN STOCKHOLDERS' EQUITY
The Company amended its articles of incorporation on March 25, 1996. The
nature of the amendment was to change the par value of its common stock from
$0.02 per share to $.001 per share.
NOTE 3 - APPLICATION OF NEW ACCOUNTING PRINCIPLE
In applying the Financial Accounting Standards Board's Statement Number 121
(Impairment of Long Lived Assets and of Long Lived Assets to be Disposed Of)
the Company was required to reviewed for impairment its long-lived assets. In
performing the review, the Company is required to estimate the future cash
flows expected to result from the use of such asset. The Company acquired
computer software ("Software") for the purpose of assisting management in
filing reports electronically with the Securities and Exchange Commission.
Even though management believes that the usefulness of the Software is for a
period greater than one year, the Software is not used in conjunction with any
generation of cash flow. Consequently, the Company has charged to expense the
total cost associated with this purchase.
NOTE 4 - SUBSEQUENT EVENTS
In August of 1996, the Company sold to four individuals in a private
transaction, 4,000,000 shares of its common stock at a price of $0.0025 per
share and received therefrom $10,000.00 cash. Thus, after this transaction,
the Company has a total of 10,758,614 shares of $.001 par value common stock
outstanding. Of the shares sold, the Company's sole officer and director
purchased 1,500,000 shares for a total of $3,750.00.
<PAGE> 8
PART I - FINANCIAL INFORMATION
Item 2. Plan of Operations
Statements regarding the Company's expectations as to future operations
and certain other statements presented in this Form 10-QSB Report constitute
forward looking information within the meaning of the Private Securities
Litigation Reform Act of 1995. Although the Company believes that its
expectations are based on reasonable assumptions within the bounds of its
knowledge of its business operations, there can be no assurance that actual
results will not differ materially from the expectations expressed herein. In
addition to matters affecting the Company in general, factors which could
cause expectations to differ are, but not limited to, the following: 1)
changes in federal and/or state securities laws; 2) changes in federal and/or
state income tax laws, in particular as they relate to tax free
reorganizations; 3) economic conditions, particularly as they relate to
securities markets; and 4) the Company's ability to continue to have
sufficient capital available to maintain its operations.
The Company was incorporated under the laws of the state of Nevada in
October of 1987, under the name of North Star Petroleum, Inc. and completed a
public offering of its common stock and warrants in August of 1988. Subsequent
to the public offering, the Company engaged in the exploration, development
and production of oil and gas on a joint venture basis with other industry
partners.
In May of 1990, the Company amended its Articles of Incorporation,
thereby changing its name to Gemstar Enterprises, Inc., increasing its par
value from $0.001 per share to $0.02 per share, and authorizing for issuance
5,000,000 shares of preferred stock. Additionally, the Company reverse split
its common stock on the basis of one $0.02 par value common share for twenty
[20], $0.001 par value common shares [1 for 20 reverse split]. All references
contained herein to the Company's common stock have taken this reverse split
into account. During 1990, the Company also acquired approximately 200 acres
of real property located in Alexander County, North Carolina. The Company's
performance in both its oil and gas business and its investment in real estate
did not generate sufficient revenue to result in profitable operations.
During the fiscal year ending in September, 1993, the Company sold all of
its assets and those liabilities associated with those assets. Thus, the
Company avoided any bankruptcy, receivership or similar proceeding. By April,
1993, all of the Company's assets had been disposed of and since that time the
Company has been considered a new entity for accounting purposes. Prior to the
end of the fiscal year of September, 1993, all liabilities which had remained
after the sale of the Company's assets were assumed by the Company's sole
officer and director, for which the Company issued its common stock at a value
of $0.02 per share and retained a receivable from this individual, which
amounted to less than $10,000. During the Company's latest fiscal year, ending
in September, 1996, and for its preceding two fiscal years ending September,
1995 and 1994, the Company did not engage in any revenue producing business
activity.
<PAGE> 9
The Company recently sold shares of its common stock in a private
transaction for the purpose of paying its operating costs. The Company is now
actively seeking a business to acquire or with which to merge, in order to
establish business operations. The Company can not assure success in this
endeavor and the acquisition of any asset or business enterprise (profitable
or not profitable) will in all likelihood result in a dilution in the
percentage ownership that a current shareholder has in the Company. This
dilution will be a result of the Company issuing additional equity securities
in exchange for the assets or operations being acquired.
If and when such a business reorganization occurs, the resultant dilution
in a current shareholder's ownership percentage in the Company after the
completion of the reorganization will occur because the Company will need to
provide payment or consideration to the previous owners of the operations or
business being acquired. Additionally, an incentive to such owners to have
their business acquired by the Company, is that the Company may sell shares of
its equity securities to have cash available to fulfill certain capital
requirements as contained in the plan of reorganization.
The Company had no employees during each of its last two fiscal years and
it is not anticipated that any employees will be hired during the current
fiscal year. However, if the Company's business operations were to change
through an acquisition of a business operation, then that businesses employees
will be retained and additional employees may be hired. At the present time,
Management is providing the Company with a location for its principal
executive offices on a "rent free basis" and no salaries or other form of
compensation are currently being paid by the Company for the time and efforts
required by management to seek an entity for the purpose of entering into a
reorganization. To the extent that the utilization of management increases,
the Company intends to reimburse management for its out-of-pocket costs and to
compensate management for the time required to fulfill its responsibilities to
the Company. During 1993, the board of directors approved resolutions
authorizing the issuance of the Company's common stock as consideration for
amounts advanced to the Company by its stockholders and may again do so in the
future.
The investigation of specific business opportunities and the negotiation,
drafting and execution of relevant agreements, disclosure documents and other
instruments will require substantial management time and attention and will
require the Company to incur substantial costs for payment of accountants,
attorneys and others, which may include management. If a decision is made not
to participate in or complete the acquisition of a specific business
opportunity, the costs thus incurred may not be recoverable in a subsequent
related investigation. Further, even if agreement is reached for the
participation in a specific business opportunity by way of investment or
otherwise, the failure to consummate the particular transaction may result in
the loss to the Company of all related costs incurred.
Currently, management is not able to determine the time or resources that
will be necessary to complete the participation in or acquisition of any
future business prospect. There is no assurance that the Company will be able
to acquire an interest in any such prospects, products or opportunities that
may exist or that any activity of the Company, regardless of the completion of
any participation in or the acquisition of any business prospect will be
profitable.
<PAGE> 10
Liquidity and Capital Resources
As of March 31, 1996, the Company had cash assets of $2,010 and $603 in
liabilities. The significant decrease in cash was due to the Company acquiring
computer software to assist in its filing of reports electronically with the
Securities and Exchange Commission. Additionally, the Company will incur
substantial legal, accounting and other associated costs to bring its
financial and corporate reporting obligations current. Total costs incurred in
this regard through the fiscal year ended September 31, 1996, amounted to
$10,069, which does not represent all of the costs yet to be incurred in this
regard. Management has not received any compensation for its efforts to bring
the Company's financial and corporate reporting obligations current. It is
anticipated that the Company will incur more cost including legal and
accounting fees, in the location, evaluation and completion of a
reorganization, should such occur. As additional time commitments are being
given to the Company by management or costs associated therewith are incurred
and paid by management, the Company may reimburse such costs through the
issuance of its equity securities or enter into promissory notes, for such
services and costs incurred.
Results of Operations
The Company has not engaged in any business operations, other than as
previously disclosed herein, during the quarters ended December 31, 1995 and
1994. Consequently, no revenue was generated by the Company during the first
quarter of each of those periods. Furthermore, the Company did not generate
any revenue during its fiscal year ended September 30, 1996 and it is not
anticipated that any revenue will be generated until a business reorganization
with an operating entity has occurred.
PART II - OTHER INFORMATION
Item 1 -Legal Proceedings:
None.
Item 2 -Changes in Securities:
The change in the par value of the Company's common stock which occurred
during the quarter being reported upon, has no direct effect on any rights of
the holders of the Company's common shares and effects only the carrying
amounts in the "common stock" and in the "paid-in capital" accounts.
Item 3 -Defaults upon Senior Securities:
None.
Item 4 -Submission of Matters to a Vote of Security Holders:
In compliance with the Nevada Revised Statues, the Company set March 25,
1996 as the record date to obtain the consent of a majority of its
shareholders for the purpose of amending its Articles of Incorporation by
changing the par value of the common stock from $0.02 per share to $0.001 per
share. This Amendment was filed in the office of the Secretary of State of
Nevada on April 29, 1996. The number of shares of the Company's common stock
eligible to vote was 6,758,614 shares, of which consent resolutions
representing 4,915,000 shares (73% of the shares eligible to vote) were voted
for adopting such Amendment.
<PAGE> 11
The form of the consent resolution and the amendment to the articles of
incorporation are made a part of this Form 10-QSB Report as Exhibit number 22
and Exhibit number 3, respectively.
Item 5 - Other Information:
None.
Item 6 - Exhibits and Reports on Form 8-K.
The Company has not filed any Reports on Form 8-K during the quarter being
covered by this Form 10-QSB.
Index of Exhibits:
Number 3: Initial Articles of Incorporation and By-laws
Incorporated by reference to the Company's registration statement on Form
S-18, File No. 33-19980-D
Number 3: Amended Articles of Incorporation
Incorporated by reference to the Company's Form 10-KSB, for the year
ended September 30, 1989
Number 3: Amended Articles of Incorporation
Included in this Report as Exhibit 3
Number 3: Amended Articles of Incorporation
Incorporated by reference to the Company's Form 10-KSB, for the year
ended September 30, 1995
Number 4: Warrant Agent Agreement
Incorporated by reference to the Company's registration statement on Form
S-18, File No. 33-19980-D
Number 4: First Amendment to Warrant Agent Agreement
Included in this Report as Exhibit 4
Number 4: Second Amendment to Warrant Agent Agreement
Incorporated by reference to the Company's Form 10-KSB, for the year
ended September 30, 1995
Number 22: Published Report Regarding Matters Submitted to a Vote
Included in this Report as Exhibit 22
Number 27: Financial Data Schedule
Included in this Report as Exhibit 27
<PAGE> 12
SIGNATURES
In accordance with the requirements of the Exchange Act, the Company
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
GEMSTAR ENTERPRISES, INC.
By: /S/Denny W. Nestripke
Denny W. Nestripke
Chief Executive Officer and
Chief Financial Officer
Date: November 15, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000829323
<NAME> GEMSTAR ENTERPRISES, INC.
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> MAR-31-1996
<CASH> 2,010
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,010
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,010
<CURRENT-LIABILITIES> 998
<BONDS> 0
0
0
<COMMON> 915,044
<OTHER-SE> (914,032)
<TOTAL-LIABILITY-AND-EQUITY> 1,012
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 6,385
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (6,385)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (6,385)
<EPS-PRIMARY> (0.00)
<EPS-DILUTED> (0.00)
</TABLE>
EXHIBIT NO. 3
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
GEMSTAR ENTERPRISES, INC.
Pursuant to the applicable provisions of the Nevada Revised Statutes, the
undersigned officer, duly authorized by the shareholders of GEMSTAR
ENTERPRISES, INC., adopts the following Articles of Amendment to its Articles
of Incorporation by stating the following:
FIRST: The present name of the Corporation is Gemstar Enterprises, Inc.
SECOND: The following Amendment to the Articles of Incorporation was
adopted by a majority vote of the shareholders of the Corporation eligible to
vote on the 25th day of March, 1996 pursuant to Section 78.320 of the Nevada
Revised Statutes.
1. Article IV - Stock is amended only with respect to paragraph A. Common
Stock as follows. Paragraph B. Preferred Stock is not amended by this
Amendment to the Articles of Incorporation.
ARTICLE IV - STOCK
A. Common Stock.
The aggregate number of shares of Common Stock which the Corporation
shall have authority to issue is 100,000,000 shares at a par value of $.001
per share. All stock when issued shall be fully paid and non-assessable. he
Board of Directors of the Corporation may, at its discretion and by resolution
of the majority of all of the members of the Board of Directors at the time of
such resolution, issue any authorized but unissued Common Stock of the
Corporation which has not been reserved for issuance upon the exercise of any
outstanding warrants, options, or other document evidencing the right to
acquire the Common Stock of the Corporation.
Each share of Common Stock shall be entitled to one vote at any meeting
of the Corporation's shareholders duly called for in accordance with the
Nevada Revised Statutes, either in person or by proxy. Cumulative voting shall
not be permitted for the election of individuals to the Corporation's Board of
Directors or for any other matters brought before any meeting of the
Corporation's shareholders, regardless of the nature thereof. Shareholders of
the Corporation's Common Stock shall not be entitled to any pre-emptive or
preferential rights to acquire additional Common Stock of the Corporation.
THIRD: The number of shares of the Corporation outstanding stock eligible
to vote on March 25, 1996, the date that this Amendment was adopted by the
shareholders of the Corporation, was 6,758,614 shares.
FOURTH: The number of shares of the Corporation that voted for the
adoption of this Amendment was 4,915,000 shares, representing 73% of the
shares eligible to vote. There were no shares voted against the adoption of
this Amendment.
[Continued]<PAGE>
DATED this 26th day of April 1996
Attest: GEMSTAR ENTERPRISES, INC.
By: /S/Denny W. Nestripke By: /S/Denny W. Nestripke
Denny W. Nestripke Denny W. Nestripke
Secretary President
AFFIRMATION
State of California
County of Riverside
Subscribed and affirmed before me, Kathleen Jones, Notary Public, on this
26th day of April, 1996, by Denny W. Nestripke, who attests, deposes and
states that he signed this Amendment to the Articles of Incorporation in his
capacity as Secretary and President of Gemstar Enterprises, Inc., that he has
read these Articles of Amendment, that he knows the contents thereof and that
these Articles of Amendment contain the Amendment duly adopted on March 25,
1996, by those shareholders of Gemstar Enterprises, Inc. eligible to vote in
accordance with Section 78.320 of the Nevada Revised Statutes.
WITNESS my hand and official seal.
/S/Kathleen Jones
Kathleen Jones
Signature of Notary
[Official Seal]
EXHIBIT NO. 22
CONSENT RESOLUTION
OF A
SHAREHOLDER
OF
GEMSTAR ENTERPRISES, INC.
This Consent Resolution, dated this 25th day of March, 1996, is being
executed pursuant to Section 78.320 of the Nevada Revised Statutes, which
provides that action so taken shall have the same effect as to cast one's vote
at a Meeting of Shareholders', duly noticed and attended by a majority of
those Shareholders eligible to vote at such a Meeting. The Undersigned,
________________________ acknowledges compliance with and agrees to be
subject to such Section of the Nevada Revised Statutes (hereinafter referred
to as an "Eligible Shareholder").
The Eligible Shareholder of Gemstar Enterprises, Inc. (hereinafter
referred to as the "Corporation") is the record holder of ___________________
shares of the Corporation's issued and outstanding common stock, which amount
represents _______ % of the total 6,758,614 shares of the issued and
outstanding common stock of the Corporation.
The Eligible Shareholder of the Corporation has reviewed the benefits of
revising the par value of the Corporation's common stock from $.02 per share
to $.001 per share and has determined that such a revision would be in the
best interest of the Corporation and of the Corporation's shareholders.
Furthermore, the Eligible Shareholder has been informed by the presently
constituted Board of Directors of the Corporation, that such a revision would
not have an adverse effect with respect to any individual or entity to whom
the Corporation is indebted at the present time, in any form, fashion or
manner.
Accordingly, the Eligible Shareholder approves the following Resolution
to change the par value of the Corporation's common stock by amending the
first paragraph of:
Article IV - Stock
A. Common Stock, of the Articles of Amendment to the Articles
of Incorporation:
RESOLVED: That the par value of the common stock of the Corporation be
revised from $.02 to $.001 per share and that such revision shall take effect
as of the date hereof without any other changes to the Articles of
Incorporation of the Corporation.
FURTHER RESOLVED: That the second paragraph of A. Common Stock, be
revised to eliminate the right of the Board of Directors of the Corporation to
allow "any unissued securities of the corporation [shall] be offered for
subscription solely to the holders of common stock of the corporation or
solely to the holders of any class or classes of such stock, in such
proportions based on stock ownership as said board at its discretion may
determine."
_________________________
Eligible Shareholder
