US SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
(Mark One)
[x] QUARTERLY REPORT PURSUANT SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: September 30, 1998
[ ]TRANSITION REPORT PURSUANT SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from:
Commission file number: 000-29722
AURORA ENERGY, LTD.
(Exact name of small business issuer as
specified in its charter)
NEVADA
(State or other jurisdiction of incorporation
or organization)
91-1780941
(IRS Employer Identification No.)
3760 North U.S. 31 South, Traverse City, MI 49684
(Address of principal executive offices)
(616) 941-0073
(Issuer's telephone number)
N/A
(Former name, former address and former fiscal
year, if changed since last report
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 __X__ No ___
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEAR
Check whether the registrant filed all documents
and reports required to be filed by Section 12, 13
or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by court.
Yes ____ 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
practicable date: 8,691,697
Transitional Small Business Disclosure Format
(check one); Yes __ No X
Part I - Financial Information
Item 1 - Financial Statements
AURORA ENERGY, LTD.
(a development stage company)
STATEMENT OF FINANCIAL POSITION
<TABLE>
<CAPTION>
(Unaudited) (Unaudited)
September 30, September 30
ASSETS 1998 1997
<S> <S> <C> <C>
Current asset
Cash and cash equivalents $ 404,665 $ 84,093
Accounts receivable 229,451 474,490
Prepaid expenses 6,194 -
Total current assets 640,310 558,583
Oil and gas properties, not subject to
amortization, using full cost accounting 1,986,273 361,741
Investment in oil and gas partnerships 138,222 143,000
Property and equipment, net 62,975 1,500
Total assets $2,827,800 $1,064,82
See notes to financial statement
/<TABLE
LE>
LIABILITIES AND STOCKHOLDERS' EQUITY
</TABLE>
<TABLE>
<CAPTION>
(Unaudited) (Unaudited)
Sept. 30, Sept. 30,
1998 1997
<S> <S> <C> <C>
Current liabilitie
Accounts payable $ 728,277 $ 223,830
Current portion of capital lease
obligations 10,170 --
Line of credit 490,000 --
Loan from Brittania Holdings -- 500,000
Advances from affiliates -- 125,000
Advances from investors 23,265 69,000
Accrued expenses 22,215 29,195
Total current liabilities $1,273,927 $ 947,025
Capital lease obligations, net of
current portion 26,068 --
Total liabilities 1,299,995 947,025
Stockholders' equity
Common stock, $.001 par value;
500,000,000 shares authorized;
8,691,697 shares issued and
outstanding 8,692 6,720
Additional paid-in capital 1,869,073 201,295
Deficit accumulated during the
development Stage (349,980) (90,216)
Total stockholders' equity 1,527,785 117,799
Total liabilities and stockholders' equity $2,827,780 $1,064,82
/<TABLE
See notes to financial statement
AURORA ENERGY, LTD.
(a development stage company)
STATEMENTS OF OPERATIONS
(UNAUDITED)
</TABLE>
<TABLE>
<CAPTION>
For the
For the For the period For the
9 months 3 months 3/12/97 3 month
ended ended (inception) ended
9/30/98 9/30/98 to 9/30/97 9/30/97
<S> <S> <C> <C> <C> <C
Operating revenues $ 19,606 $ 12,079 $ -- $ --
Other revenue 6,976 4,885 13,817 13,817
General and
Administrative expenses 381,162 106,103 95,528 87,607
Operating loss (354,580) (89,139) (81,711) (73,790)
Other income (expense
Equity in loss of
investee partnerships (43,865) 2,942 -- --
Gain on sale of assets 300,000 300,000 -- --
Interest income 11,640 587 -- --
Interest expense (12,331) (8,448) (7,990) (7,990)
Other expense, net 255,444 295,091 (7,990) (7,990)
Net loss $ (99,136) $205,952 $ (89,701) $(81,780)
Net loss per basic an
diluted common share $ (.011) $ .037 $ (.016) $ (.012)
/<TABLE
See notes to financial statements
AURORA ENERGY, LTD.
(a development stage company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM MARCH 12, 1997 (INCEPTION)
THROUGH SEPTEMBER 30, 1998 (UNAUDITED)
</TABLE>
<TABLE>
<CAPTION>
Deficit
Accumulated
Add'l during the
Common Stock Paid in Developmental
Shares Amount Capital Stage Total
<S><S> <C> <C> <C> <C> <C
Common stock issue
for cash at
$.001 per share 514,997 $ 515 $ -- $ -- $ 515
Common stock issue
for cash a
$0.25 per share 580,000 580 13,920 -- 14,500
Common stock issue
in exchange fo
interest in oil an
gas partnership 5,575,200 5,575 137,425 -- 143,000
Common stock issue
for cash at
$1.00 per share 50,000 50 49,950 -- 50,000
Common stock issue
in exchange for
cancellation of
loan at $.7142857
per share 700,000 700 499,300 -- 500,000
Common stock issue
for cash at $.90
per share 1,191,500 1,192 1,071,158 -- 1,072,350
Common stock options
issued to consultant
and non-employee
director -- -- 17,400 -- 17,400
Common stock issue
in exchange for
oil and gas
working interests 80,000 80 79,920 -- 80,000
Net loss -- -- -- (349,980) (349,980)
Balance at
9/30/98 $8,691,697 $ 8,692 $1,869,073 $(349,980)$1,527,785
/<TABLE
See notes to financial statement
AURORA ENERGY, LTD
(a development stage company
STATEMENTS OF CASH FLOW
FOR THE PERIOD FROM MARCH 12, 1997 (INCEPTION)
THROUGH SEPTEMBER 30, 1997 AND FOR THE NINE
MONTHS ENDED SEPTEMBER 30, 1998
<TABLE
<CAPTION
(Unaudited)(Unaudited
1998 1997
<S> <S> <S> <C> <C>
Cash flows from operating activies:
Net loss $ (99,136) $ (89,701)
Adjustments to reconcile net loss to net
cash used in operating activities
Depreciation and amortization 6,279 --
Equity in loss of investee partnership 43,865 --
Services received in exchange for stock options -- --
Changes in operating assets and liabilities
which provided (used) cash
Accounts receivable 74,719 (474,490)
Prepaid expenses (1,244) --
Accounts payable 542,125 233,830
Accrued expense (1,087) (29,195)
Net cash used in operating activities 565,521 (311,166)
Cash flows from investing activities
Acquisition of interests in oil and
gas properties (1,205,423) (361,741)
Acquisition of interests in investe
partnerships (82,773) --
Capital expenditures for propert
and equipment (6,950) (1,500)
Net cash used in investing activiites (1,295,146) (363,241)
Cash flows from financing activiite
Proceeds from the sale of common stock 198,450 64,500
Proceeds of loan from financial institution 490,000 500,000
Advances from affiliate -- 125,000
Repayment of advancement from affiliate -- --
Advances from investors 23,265 69,000
Payments to investors (89,000) --
Payments made to reduce capital lease
obligations 6,833) --
Net cash provided by financing activities 615,882 758,500
Net increase in cash and cash equivalents (113,743) 84,093
Cash and cash equivalents, beginning of period 518,408 --
Cash and cash equivalents, end of period $ 404,665 $ 84,093
/<TABLE
See notes to financial statement
AURORA ENERGY, LTD
(A DEVELOPMENT STAGE COMPANY
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 BASIS OF PRESENTATION
The accompanying unaudited condensed financial
statements have been prepared in accordance with
generally accepted accounting principles for interim
financial information and with the instructions to
form 10-QSB and Article 10 of Regulation S-X. Accordingly,
they do not include all of the information and
footnotes required by generally accepted accounting
principles for complete financial statements. In the
opinion of management, all adjustments (consisting only
of normal recurring accruals and recognition of equity
in the results of operations of affiliates)considered
necessary for a fair presentation have been included.
Operating results for the nine month period ended
September 30, 1998 are not necessarily indicative of
the results that may be expected for the year ended
December 31, 1998. For further information, refer
to the financial statements and footnotes thereto
included in the Company's annual report for the
period March 12, 1997 (inception) through
December 31,1997
NOTE 2 COMPUTATION OF LOSS PER SHARE.
Loss per share is computed for the nine months ended
September 30, 1998 and for the period March 12, 1997
to September 30, 1997, using the weighted average number
of common shares outstanding during the period (8,654,822
and 5,584,764 respectively) determined pursuant to
Statement of Financial Accounting Standards (SFAS) No.
128, "Earnings Per Share". This Statement requires a
dual presentation and reconciliation of "basic" and
"diluted" per share amounts. Diluted reflects the
potential dilution of all common stock equivalents.
Since the assumed exercise of common stock options
would be antidilutive for all periods presented, such
exercise is not assumed for purposes of determining
diluted loss per share. Accordingly, diluted and basic
per share amounts are equal.
Item 2 Plan of Operations
The Company seeks to maximize stock price and
shareholder value through exploration in lower risk
shale natural gas plays and through the acquisition
of properties with proven production and positive cash
flow. The Company's short-term goal (the next 12 months)
is to acquire or to find through exploration and bring
on line enough production and positive cash flows to cover
its general and administrative expenses. The Company's
long term goals include continued building of reserves
and cash flows from production to allow for further
development of existing properties, mortgaging proved
developed reserves to finance continued exploration and
growth in value through development of untapped Antrim
Shale, New Albany Shale or other formations.
The Company should be able to meet its cash requirements
for the rest of the 1998 calendar year. It will be
necessary to raise additional funds for operations into
1999. These funds may be raised in part by selling
additional shares of the Company's common stock through a
private placement, and in part, by the sale of undeveloped
or incomplete oil and gas properties and projects.
The Company is also attempting to obtain recourse financing
for the acquisition of productive properties capable of
adding positive cash flows after servicing the related
debts.
The Company anticipates no change in the number of employees.
Part I
Item 4. Submission of Matters to a Vote of Security Holder
The annual meeting of the shareholders was conducted on
September 30, 1998. The Board of Directors was elected
in its entirety. Thomas W. Tucker, William W. Deneau,
John V. Miller, Jr., and Gary J. Myles were elected
for terms extending until the next annual meeting of
the shareholders. Each director was elected on a
vote of 7,850,192 shares in favor and 11 shares against
Rehmann Robson, P.C. of Traverse City, Michigan, was
appointed to continue to serve as the Company's
independent auditors, with a vote of 7,300,192 shares
in favor and 550,011 shares abstaining
An amendment to the Company's Bylaws was approved,
moving the date for the annual meeting from September 30
to May 15 of each year. The vote was 7,300,137 shares
in favor, with 550,066 shares abstaining.
An amendment to the Company's Bylaws was approved,
deleting a provision that permitted amendment of the
bylaws only by the shareholders, and substituting
the following provision:
These Bylaws may be amended or repealed, or new
bylaws may be adopted, by vote of a majority of the
directors then in office or by the affirmative vote
of a majority of the shares entitled to vote at any
regular or special meeting of the stockholders.
The stockholders may specify particular provisions
of these Bylaws which shall not be altered or repealed
by the Board of Directors.
The vote was 6,545,137 shares in favor, 755,000
shares opposed, and 550,066 shares abstaining.
</TABLE>
<TABLE>
Item 6 Index to Exhibits
<S> <C> <C> <C>
(2) Plan of acquisition None
(3) (i) Restated Articles of Incorporatio
(ii) Bylaw
(4) Instruments defining the Incorporated by reference
rights of security holders from Form 10-SB
(10) Material contracts Incorporated by reference
from Form 10-SB
P Bank Loan Documents Incorporated by reference
from Form 10-QSB
Second Quarter 1998
(11) Statement regarding computation of
per share earnings None
(15) Letter or unaudited interim None
financial information
(18) Letter on change in accounting
principles None
(22) Published report regarding matter
submitted to vote None
(24) Power of Attorney None
(27) Financial Data Schedule
(99) Additional Exhibits None
SIGNATURES
In accordance with the requirements on the
Exchange Act, the registrant caused this report to
be signed on its behalf by the undersigned, thereunto
duly authorized
Date: November 13, 199
AURORA ENERGY, LTD.
by: //William W. Deneau, President//
RESTATED ARTICLES OF INCORPORATION
OF
AURORA ENERGY, LTD
KNOW ALL MEN BY THESE PRESENTS
That we the undersigned, having this day associated
ourselves together for the purpose of forming a
corporation under and by virtue of the laws of the
State of Nevada, hereby adopt the following Articles
of Incorporation:
ARTICLE
The name of the corporation is Aurora Energy, Ltd.
ARTICLE I
The principal place of business of the corporation
located within the State of Nevada shall be 825 N.
Lamb, No. 77, Las Vegas, Nevada. Corporate mail to
be directed to: P. O. Box 70011, Las Vegas, Nevada
89170-0011, in Clark County. The Board of Directors
may establish from time to time other offices within
and without the State of Nevada.
ARTICLE II
The nature of the business or purposes proposed to be
transacted or carried on by the corporation shall be
to engage in any lawful activity
ARTICLE IV
The total authorized capital stock of the corporation
is the amount of Five Hundred Million shares of common
stock having a par value of $.001 per share.
ARTICLE V
The names and post office addresses of the Board of
Directors of Aurora Energy, Ltd. are as follows:
William W. Deneau
President and Director
2533 N. Carson Street
Carson City, NV 89706
Barbara J. Johnson
Secretary
2533 N. Carson Street
Carson City, NV 89706
Thomas W. Tucker
Treasurer and Director
2533 N. Carson Street
Carson City, NV 89706
John V. Miller
Director and Vice President
2533 N. Carson Street
Carson City, NV 89706
Gary J. Myles
Director
2533 N. Carson Street
Carson City, NV 89706
The business and affairs of the Corporation shall
be conducted by a board of directors of such number
as the By-laws may provide: but the directors may
not be less than three. A governing board of directors
may elect to increase the number of directors by a
vote of the board.
ARTICLE V
Consideration for issuance of shares may be paid
in whole or in part, in money, labor, property, or
other things of value to the Corporation. When
payment of the consideration for which said shares
are to be issued shall have been received by the
Corporation, such shares shall be deemed to be fully
paid and non-assessable. In absence of fraud in
the transaction, the judgment of the Board of Directors
as to the value of the consideration for shares
shall be conclusive.
ARTICLE VII
The Board of Directors shall have the power to
authorize from time to time, other classifications
of stock, such as preferred, special, or additional
common, and to designate the number of said shares
and shall fix and determine the designations, rights,
preferences or other variations of each class or
series of stock. The Board of Directors shall also
have the power to authorize the issuance of bonds,
and variations of same for any purpose determined
by the Board, to be in the best interests of the
Corporation, and its shareholders.
ARTICLE VIII
The Corporation shall have perpetual existence.
ARTICLE IX
Any one or more of the directors may be removed,
with or without cause, at any time by a vote or
written consent of the stockholders representing
a majority of the issued and outstanding capital
stock of the Corporation entitled to voting power.
ARTICLE X
The Board of Directors shall elect or appoint
officers: president, secretary, treasurer, etc.,
a resident agent, and such other officers, agents,
advisors or others for the administration of the
business of the Corporation as it shall from time
to time determine. fficers of the Corporation need
not be members of the Board of Directors.
ARTICLE X
In furtherance and not in limitation of the powers
vested by law, the Board of Directors is expressly
authorized:
A. To hold meetings within or without the State of Nevada.
B. If the By-laws so provide, to designate two or
more of its number to constitute an Executive Committee,
which Committee shall have and exercise any or all of
the powers of the Board of Directors in the management
of the business and affairs of the Corporation.
C. Subject to the Bylaws: to make, alter, amend or
change the By-laws of the Corporation.
D. Subject to the By-laws, to appoint a resident
agent of the state of domicile; to dismiss the
registrant agent and file an appointment of another
resident agent, for any valid reason what-so-ever.
ARTICLE XII
To the extent permitted by law, the private property
of each and every stockholder, officer and director
of the Corporation, real or personal, tangible or
intangible, now owned or hereafter acquired by any of
them, is and shall be forever exempt from all debts
and obligations of the Corporation, of any type
what-so-ever.
ARTICLE XIII
The Corporation shall indemnify all of its officers
and directors, present and future, against any and
all expenses incurred by them, and each of them
including, but not limited to, legal fees, judgments,
and penalties which may be incurred, rendered, or
levied in any legal action brought against any or all
of them for or on account of any act or omission alleged
to have been committed while acting within the scope
of their duties as officers or directors of this
Corporation.
ARTICLE XIV
The names and post office addresses of the
incorporators are as follows:
Name Post Office Address
H. Eugene Gerke P.O. Box 70011, Las Vegas, NV 89170
Nicky R. Vaughn P.O. Box 390, Brisbane, CA 9400
Harold D. Blethen P. O. Box 6175, San Jose, CA 9515
ARTICLE X
The Corporation's shareholders do not have a preemptive
right to acquire the Corporation's unissued shares.
ARTICLE XV
A director or officer is not liable for damages for
breach of fiduciary duty as a director or officer except
for: (a) acts or omissions which involve intentional
misconduct, fraud or a knowing violation of the law; or
(b) the payment of a distribution in violation of
NRC 78.300.
BY-LAWS
OF
AURORA ENERGY, LTD.
(A corporation whose domicile is the State of Nevada)
ARTICLE I - OFFICES
Section 1. The registered office of the Corporation
in the State of Nevada shall be at 2533 N. Carson Street,
Carson City, Nevada 89706.
The registered agent in charge thereof shall be:
LAUGHLIN & ASSOCIATES OF CARSON CITY, NEVADA.
Section 2. The Corporation may also have offices
at such other places as the Board of Directors may from
time to time appoint or the business of the Corporation
may require.
ARTICLE II - SEAL
Section 1. The Corporate Seal shall have inscribed
thereon the name of the Corporation, the year of its
organization and the words "Corporate Seal", NEVADA.
However, a Corporate Seal shall not be a requirement.
ARTICLE III - STOCKHOLDERS' MEETING
Section 1. The meetings of stockholders shall be held
at the registered office of the Corporation in the
State of Michigan or such place, either within or
without this State, as may be selected from time to time
by the Board of Directors.
Section 2. ANNUAL MEETINGS: The annual meeting of the
stockholders shall be held on May 15 of each year if
not a Saturday, Sunday or legal holiday, and if a Saturday,
Sunday or legal holiday, then on the next secular day
following, at the time and place designated by the Board.
At the annual meeting, the stockholders shall elect
Directors and transact such other business as may
properly be brought before the meeting.
Section 3. ELECTION OF DIRECTORS: Elections of the
Directors of the Corporation may be by written ballot.
Section 4. SPECIAL MEETINGS; Special meetings of the
stockholders may be called at any time by the President,
or the Board of Directors, or stockholders entitled to
cast at least Twenty-five percent of the votes which all
stockholders are entitled to cast at the particular
meeting. At any time, upon written request of any person
or persons who have duly called a special meeting, it
shall be the duty of the Secretary to fix the date of
the meeting, to be held not more than sixty days after
receipt of the request, and to give due notice thereof.
If the Secretary shall neglect or refuse to fix the
date of the meeting and give notice thereof, the person
or persons calling the meeting may do so.
Business transacted at all special meetings shall be
confined to the objects stated in the call and matters
germane thereto, unless all stockholders entitled to
vote are present and consent, or such shareholders as
control a majority of votes of all outstanding shares.
Written notice of a special meeting of stockholders
stating the time and place and object thereof, shall be
given to each stockholder entitled to vote thereat at
least ten days before such meeting, unless a greater
period of notice is required by statute in a particular
case
Section 5. QUORUM: A majority of the outstanding shares
of the Corporation entitled to vote, represented in person
or by proxy, shall constitute a quorum at a meeting of
stockholders. At the meeting at which a quorum shall be
present or represented, any business may be transacted
which might have been transacted at the meeting as
originally noticed. If less than a majority of the
outstanding shares entitled to vote is represented at a
meeting, a majority of the shares so represented may
adjourn the meeting without further notice. The
stockholders present at a duly organized meeting may
continue to transact business until adjournment,
notwithstanding the withdrawal of enough stockholders
to leave less than a quorum.
Section 6. PROXIES: Each Stockholder entitled to vote
at a meeting of stockholders or to express consent or
dissent to Corporate action in writing without a meeting
may authorize another person or persons to act for him
by proxy, but no such proxy shall be voted or acted upon
after three years from its date, unless the proxy provides
for a longer period
A duly executed proxy shall be irrevocable if it states
that it is irrevocable and if, and only as long as, it
is coupled with interest sufficient to law to support
an irrevocable power. A proxy may be made irrevocable
regardless of whether the interest with which it is coupled
is an interest in the stock itself or an interest in the
Corporation generally. All proxies shall be filed with
the Secretary of the meeting before being voted upon.
Section 7. NOTICE OF MEETINGS: Whenever stockholders are
required or permitted to take any action at a meeting,
a written notice of the meeting shall be given which
shall state the place, date and hour of the meeting and
in the case of a special meeting, the purpose or purposes
for which the meeting is called
Unless otherwise provided by law, written notice of
any meeting shall be given not less than ten nor more
than sixty days before the date of the meeting to each
stockholder entitled to vote at such meeting
Section 8. CONSENT IN LIEU OF MEETINGS: Any action
required to be taken at any annual or special meeting
of stockholders of the Corporation, or any action which
may be taken at any annual or special meeting of such
stockholders, may be taken without a meeting, without
prior notice and without a vote, if a consent in writing,
setting forth the action so taken, shall be signed by
the holders of outstanding stock having not less than a
majority of the number of votes that would be necessary
to authorize or take such action at a meeting at which all
shares entitled to vote thereon were present and voted.
Prompt notice of the taking of the Corporate action
without a meeting by less than unanimous written consent
shall be given to those stockholders who have not
consented in writing.
Section 9. LIST OF STOCKHOLDERS: The officer who has
charge of the stock ledger of the Corporation shall
prepare and make, at least ten days before every meeting
of stockholders, a complete list of stockholders entitled
to vote at the meeting, arranged in alphabetical order,
and showing the address of each stockholder and the number
of shares registered in the name of each stockholder.
No share of stock upon which any installment is due and
unpaid shall be voted at any meeting. The list shall
be open to the examination of any stockholder, for
any purpose germane to the meeting, during ordinary
business hours for a period of at least ten days prior
to the meeting, which place shall be specified in the
notice of the meeting. The list shall also be produced
and kept at the time and place of the meeting during
the whole time thereof, and be inspected by any
stockholder who is present
In event the Corporation has become a publicly held
entity whose shares are currently trading in the
public market place, a certified current list of
the Corporation's shareholders in alphabetical order,
shall be acquired from the Corporation's Transfer Agent,
and the Officer or Agent in charge at the meeting shall
determine that no share of stock upon which any
installment is due and unpaid shall be voted at any
meeting. In all events the list of shareholders shall
be open to the examination of any shareholders, for
any reason germane to the meeting
ARTICLE IV - DIRECTOR
Section 1. The business and affairs of this Corporation
shall be managed by its Board of Directors, number three
or more. The Directors need not be residents of this
State or shareholders in the Corporation. They shall
be elected by the stockholders at the annual meeting of
stockholders of the Corporation, and each Director
shall be elected for a term of: until his successor
shall be elected and shall qualify or until his earlier
resignation or removal. The Board may also increase
its own number of members and a chairman and vice-chairman.
In event of all Board positions being vacated, a majority
vote of the shareholders shall elect a new Board of
Directors.
Section 2. REGULAR MEETINGS: Regular meetings of the
Board shall be held without notice at the Registered Office
of the Corporation, or at such other time and place as
shall be determined by the Board.
Section 3. SPECIAL MEETINGS: Special meetings of the
Board may be called by the President at any time, with
each Director, either personally, by telephone, or by
facsimile transmission, or by mail, or by telegram.
Special meetings shall be called by the President or
Secretary in like manner and on like notice on the
written request of a majority of the Directors in office.
Section 4. QUORUM: A majority of the total number
of Directors shall constitute a quorum for the
transaction of business.
Section 5. CONSENT IN LIEU OF MEETING: Any action
required or permitted to be taken at any meeting of
the Board of Directors, or of any committee thereof,
may be taken without a meeting if all members of the
Board or committee, as the case may be, consent thereto
in writing, and the writing or writings are filed with
the minutes of proceedings of the Board or committee.
The Board of Directors may hold its meetings, and have
an office or offices, outside of this State
Section 6. CONFERENCE TELEPHONE: One or more Directors
may participate in a meeting of the Board, of a
committee of the Board or of the stockholders, by
means of conference telephone or similar communications
equipment by means of which all persons participating
in the meeting can hear each other; participation
in this manner shall constitute presence in person
at such meeting
Section 7. COMPENSATION: Directors shall not receive
any stated salary for their services; however by
resolution of the Board, a fixed sum for attendance
and expenses, if any, may be allowed for attendance
at each regular or special meeting of the Board.
Additionally, options for non-employee directors
as provided in a stock option plan is provided for
herein. Nothing herein contained shall be construed
to preclude any director from serving the Corporation
in any other capacity and receiving compensation thereof.
Section 8. REMOVAL: Any Director or the entire
Board of Directors may be removed, with or without
cause, by holders of a majority of the shares then
entitled to vote at an election of Directors.
ARTICLE V - OFFICERS
Section 1. The executive officers of the Corporation
shall be chosen by the Directors and in event of a
vacancy on the Board the remaining Directors may appoint
a replacement.
The Board of Directors may also choose a President,
one or more Vice Presidents and such other officers
as it shall deem necessary. Any number of offices
may be held by the same person.
Section 2. SALARIES: Salaries of all officers and
agents of the Corporation shall be fixed by the Board
of Directors.
Section 3. TERM OF OFFICE: The officers of the
Corporation shall hold office until their successors
are chosen and have qualified. Any officer or agent
elected or, appointed by the Board may be removed by
the Board of Directors whenever in its judgment the
best interest of the Corporation will be served thereby.
Section 4. PRESIDENT: The President shall be the
Chief Executive Officer of the Corporation; he shall
preside at all meetings of the stockholders and
directors; he shall have general and active management
of the business of the Corporation, shall see that
all orders and resolutions of the Board are carried
into effect, subject, however, to the right of the
directors to delegate any specific powers, except
such as may be by statute exclusively conferred on
the President, to any other officer or officers of
the Corporation. He shall execute bonds, mortgages
and other contracts requiring a seal, under the seal
of the Corporation. He shall be EX-OFFICIO a member
of all committees, and shall have the general power
and duties of supervision and management usually vested
in the office of President of a Corporation
Section 5. SECRETARY: The Secretary shall attend
all sessions of the Board and all meetings of the
stockholders and act as clerk thereof, and record
all the votes of the Corporation and the minutes
of all its transactions in a book to be kept for
that purpose, and shall perform like duties for
all committees of the Board of Directors when
required. He shall give, or cause to be given,
notice of all meetings of the stockholders and of
the Board of Directors, and shall perform such other
duties as may be prescribed by the Board of
Directors or President, and under whose supervision
he shall be. He shall keep in safe custody the
Corporate Seal of the Corporation, and when
authorized by the Board or President, affix the
same to any instrument requiring it.
Section 6. TREASURER: The Treasurer shall have
custody of the Corporate funds and securities and
shall keep full and accurate accounts of receipts
and disbursements in books belonging to the
Corporation, and shall keep the moneys of the
Corporation in a separate account to the credit
of the Corporation. He shall disburse the funds
of the Corporation as may be ordered by the Board,
taking proper vouchers for such disbursements, and
shall render to the President and Directors, at
regular meetings of the Board, or whenever they
may require it, an account of all his transactions
as Treasurer and of the financial condition of the
Corporation.
ARTICLE VI - VACANCIES
Section 1. Any vacancies occurring in any office
of the Corporation by death, resignation, removal
or otherwise, shall be filled by the Board of
Directors. Vacancies and newly created Directorships
resulting from any increase in the authorized number
of Directors may be filled by a majority of the Directors
then in office, although less than a quorum, or by a
sole remaining Director. If at any time, by reason
of death or resignation or other cause, the Corporation
should have no Directors in office, then any officer
or stockholder or an executor, administrator, trustee
or guardian of a stockholder, or other fiduciary
entrusted with the responsibility for the person
or estate of a stockholder, may call a special
meeting of stockholders in accordance with the
provisions of these By-Laws
Section 2. RESIGNATIONS EFFECTIVE AT FUTURE DATE:
When one or more Directors shall resign from the Board,
effective at a future date, a majority of the Directors
then in office, including those who so have resigned,
shall have power to fill such vacancy or vacancies,
the vote thereon to take effect when such resignation
or resignations shall become effective.
ARTICLE VII - CORPORATE RECORDS
Section 1. Any stockholder of record, in person or
by attorney or other agent, shall, upon written demand
under oath stating the purpose thereof, have the right
during the usual hours for business and with such advance
notice to the Corporation as may be set by the State
of Nevada to inspect for any proper purpose the
Corporation's list of its stockholders, and its other
books and records, and to make copies or extract
therefrom. A proper purpose shall mean a purpose
reasonably related to such person's interest as a
stockholder. In every instance where attorney or
other agent shall be the person who seeks the rights
to inspection, the demand under oath shall be
accompanied by a Power of Attorney or such other
writing which authorizes the attorney or other agent
to so act on behalf of the stockholders. The
demand under oath shall be directed to the
Corporation at its registered office in this
State or at its principal place of business.
ARTICLE VIII - STOCK CERTIFICATES, DIVIDENDS, ETC.
Section 1. The stock certificates of the Corporation
shall be numbered and registered, the transfer books
of the Corporation as they are issued, or by the
Corporation's Registrar. They shall bear the Corporate
Seal and shall be signed by the Corporate transfer agent
Section 2. TRANSFERS: Transfers of shares shall be
made on the books of the Corporation by the Registrar
in behalf of the Corporation only upon surrender of
the certificates therefore, endorsed by the person named
in the certificate or by attorney, lawfully constituted
in writing. No transfer shall be made which is
inconsistent with law. A "Do Not Transfer" demand may
be made by the Corporation to its Registrar if for
lawful reasons
Section 3. LOST CERTIFICATES: The Corporation may issue
a new certificate of stock in the place of any certificates
theretofore signed by it, alleged to have been lost,
stolen or destroyed, and the Corporation may require
the owner of the lost, stolen or destroyed certificate,
or his legal representative to give the Corporation a
bond sufficient to indemnify it against any claim that
may be made against it on account of the alleged loss,
theft or destruction of any such certificates or the
issuance of such new certificates.
Section 4. RECORD DATE: In order that the Corporation
may determine the stockholders entitled to notice of or
to vote at any meeting of stockholders or any adjournment
thereof, or to express consent to Corporate action in
writing without a meeting, or entitled to receive payment
of any dividend or other distribution or allotment of
any rights, or entitled to exercise any rights in respect
of any change, conversion or exchange of stock or for
the purpose of any other lawful action, the Board of
Directors may fix, in advance, a record date, which
shall not be more than sixty nor less than ten days
before the date of such meeting, nor more than sixty
days prior to any other action.
If no record date is fixed
(a) The record date for determining stockholders entitled
to notice or to vote a meeting of stockholders shall be
at the close of business on the day next preceding the day on
which notice is given, or, if notice is waived, at the
close of business on the day next preceding the day on
which the meeting is held
(b) The record date for determining stockholders entitled
to express consent to Corporate action in writing without
a meeting, when no prior action by the Board of Directors
is necessary, shall be the day which the first written
consent is expressed.
(c) The record date for determining stockholders for any
other purpose shall be at the close of business on the day
on which the Board of Directors adopts the resolution
relating thereto.
(d) A determination of stockholders of record entitled to
notice of or to vote at a meeting of stockholders shall
apply to any adjournment of the meeting; provided, however,
that the Board of Directors may fix a new record date for
adjourned meeting
Section 5. DIVIDENDS: The Board of Directors may declare
and pay dividends upon the outstanding shares of the
Corporation from time to time and to such extent as they
deem advisable, in the manner and upon the terms and
conditions provided by statute and Certificate of
Incorporation
Section 6. RESERVES: Before payment of any dividends
there may be set aside out of the net profits of the
Corporation such sum or sums as the Directors, from
time to time, in their absolute discretion, think proper
as a reserve fund to meet contingencies, or for repairing
or maintaining any property of the Corporation, or for
such other purposes as the Directors think conducive to
the interests of the Corporation, and the Directors may
abolish any such reserve in the manner in which it was
created.
ARTICLE IX - MISCELLANEOUS PROVISIONS
Section 1. FISCAL YEAR: The fiscal year shall begin on
the first day of the calendar annually.
Section 2. CHECKS: All checks or demands for money
and notes of the Corporation shall be signed by such
officer or officers as the Board of Directors may from
time to time designate.
Section 3. NOTICE: Whenever written notice is required
to be given to any person, it may be given to such person,
either personally or by sending a copy thereof through the
mail, or by telegram, charges prepaid, to this address
appearing on the books of the Corporation, or supplied by
him to the Corporation for the purpose of notice. If the
notice is sent by mail or by telegraph, it shall be deemed
to have been given to the person entitled thereto when deposited
in the United States mail or with a telegraph office for transmission
to such person. Such notice shall specify meeting of
stockholders, the general nature of the business
to be transacted
Section 4. WAIVER OF NOTICE: Whenever any written notice
is required by statute, or by the Certificate or the By-Laws
of this Corporation a waiver thereof in writing, signed by
the person or persons entitled to such notice, whether before
or after the time stated therein, shall be deemed equivalent
to the giving of such notice. Except in the case of a special
meeting of stockholders, neither the business to be transacted
at, nor the purpose of the meeting need be specified in the
waiver of notice or such meeting. Attendance of a person
either in person or by proxy, at any meeting shall constitute
a waiver of notice of such a meeting, except where a person
attends a meeting for the express purpose of objecting to
the transaction of any business because the meeting was
not lawfully called or convened.
Section 5. RESIGNATIONS: Any Director or other Officer
may resign at any time, such resignation to be in writing,
and to take effect from the time of its receipt by the
Corporation, unless some time be fixed in the resignation
and then from that date. The acceptance of a resignation
shall not be required to make it effective
Section 6. GENDER NEUTRAL: Wherever from the context it
appears appropriate, each term stated in the singular or
the plural shall include the singular and the plural, and
pronouns stated in either the masculine, the feminine or
the neuter gender shall include the masculine, feminine
and neuter
ARTICLE X - ANNUAL STATEMENT
Section 1. The President and Board of Directors shall
present at each annual meeting a full and complete statement
of the business and affairs of the Corporation for the
preceding year. Such statement shall be prepared and
presented in whatever manner the Board of Directors shall
deem advisable and need not be verified by a certified
public accountant.
ARTICLE XI - AMENDMENTS
Section 1. These Bylaws may be amended or repealed,
or new bylaws may be adopted, by vote of a majority of
the directors then in office or by the affirmative vote
of a majority of the shares entitled to vote at any
regular or special meeting of the stockholders. The
stockholders may specify particular provisions of these
Bylaws which shall not be altered or repealed by the
Board of Directors.
__________________________________
Secretary
Exhibit 27 - Financial Data Schedule
Article 5 of Regulation S-X
</TABLE>
[ARTICLE] 5
[MULTIPLIER] 1
<TABLE>
<S> <C>
[PERIOD-TYPE] 9-MO
[FISCAL-YEAR-END] DEC-31-1998
[PERIOD-END] SEP-30-1998
[CASH] 404,665
[SECURITIES] 0
[RECEIVABLES] 229,451
[ALLOWANCE] 0
[INVENTORY] 0
[CURRENT-ASSETS] 640,310
[PP&E] 69,986
[DEPRECIATION] 7,011
[TOTAL-ASSETS] 2,827,780
[CURRENT-LIABILITIES] 1,273,927
[BONDS] 26,068
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 8,692
[OTHER-SE] 1,869,073
[TOTAL-LIABILITY-AND-EQUITY] 2,827,780
[SALES] 0
[TOTAL-REVENUES] 16,964
[CGS] 0
[TOTAL-COSTS] 3,533
[OTHER-EXPENSES] 102,570
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 8,448
[INCOME-PRETAX] (205,952)
[INCOME-TAX] 0
<INCOME-DISCONTINUED> 0
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
</TEXT
</DOCUMENT
</SUBMISSION
</TABLE>
