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The following is an excerpt from a SB-2 SEC Filing, filed by SENSUS CAPITAL CORP on 3/23/2000.
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SENSUS CAPITAL CORP - SB-2 - 20000323 - CERTAIN_TRANSACTIONS

CERTAIN TRANSACTIONS

On February 10, 2000, the Company raised $62,000 in a private placement through the sale of 124,000 shares of its Common Stock to the OM Security Holders. The Company agreed to allow OM Security Holders to offer to sell the 124,000 Shares in this Offering. If applicable, the registration period shall commence 120 days after the effective date of this registration statement and will expire on the first to occur of three years from the effective date or when the OM Security Holders are able to otherwise sell such amount of shares under Rule 144 promulgated under the Securities Act.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Not Applicable.

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CONFLICTS

Sensus

Except as disclosed herein, there are no material interests, direct or indirect, of directors, senior officers or any shareholders who beneficially own, directly or indirectly, more than 10% of the outstanding Sensus Shares or any known associates or affiliates of such persons, in any transaction since incorporation or in any proposed transaction which has materially affected or would materially affect Sensus. See "TargetCo Acquisition Agreement."

Alberta Corp.

The directors, officers and principal shareholders of Alberta Corp. (and the known associates and affiliates of such persons) have no direct or indirect interest in any material transaction involving Alberta Corp. since its incorporation.

The directors of Alberta Corp. are engaged and will continue to be engaged in other projects. Conflicts of interest, if any, which arise will be subject to, and governed by, procedures prescribed by the ABCA, which require a director or officer of a corporation who is a party to, or is a director or an officer of, or has a material interest with any person who is a party to, a material contract or proposed material contract with the corporation, to disclose his interest and, in the case of directors, to refrain from voting on any matter in respect of such contract unless otherwise permitted under the ABCA.

OPTION GRANTS IN LAST FISCAL YEAR

Both Sensus and Alberta Corp. were formed in 1999 and have not granted any options prior to the date of this offering.

INDEBTEDNESS OF SENSUS' AND ALBERTA CORP.'S DIRECTORS AND SENIOR OFFICERS

Since incorporation, no indebtedness has been incurred nor does any indebtedness currently exist between Sensus or Alberta Corp. and the directors or officers of Sensus or Alberta Corp. or any of their associates or affiliates.

EMPLOYMENT AGREEMENTS

Not applicable.

1999 PRIVATE PLACEMENTS

On February 10, 2000, the Company consummated the sale, in a private placement, of 124,000 shares of Common Stock for $0.50 per share to OM Security Holders, for which the Company received proceeds of $62,000. A portion of the proceeds from this sale will be used to finance the expenses associated with this Offering.

44

PRINCIPAL STOCKHOLDERS

The following table sets forth information with respect to the beneficial ownership of the Company's Common Stock as of February 18, 2000, and as adjusted to reflect the sale of the shares of Common Stock offered under this Prospectus by: (1) each person who we know owns beneficially more than 5% of our Common Stock, (2) each of our directors individually, (3) each of our executive officers individually and (4) all of our executive officers and directors as a group.

Unless otherwise indicated, to our knowledge, all persons listed below have sole voting and investment power with respect to their shares of Common Stock. Shares of Common Stock that an individual or group has the right to acquire within 60 days of February 18, 2000 pursuant to the exercise of options are deemed to be outstanding for the purpose of computing the percentage ownership of such person or group, but are not deemed outstanding for the purpose of calculating the percentage owned by any other person listed.

Beneficial Ownership of Common Stock

See "Beneficial Ownership of Common Stock."

DESCRIPTION OF CAPITAL STOCK

Sensus

General

As of the date of this Prospectus, Sensus is authorized to issue 25,000,000 shares of Common Stock (the "Sensus Shares"). There are 10,156,500 shares of Common Stock issued and outstanding. All shares are fully paid and non-assessable. In connection with this Offering, the board of directors has authorized the issuance of up to 1,000,000 Shares to be issued to the investors.

The following is a general description of the material rights, privileges, restrictions and conditions attached to each class of shares:

Subject to the provisions of the Nevada Corporations Code, the holders of the Sensus Shares are entitled to receive notice of, to attend and vote at all meetings of the shareholders of Sensus (other than meetings of a class or series of shares other than the Sensus Shares as such) and are entitled to one vote for each Sensus Share held, except as required by law.

Subject to the payment of preferred rights attaching to any other class or series of shares of Sensus, the holders of the Sensus Shares are entitled to receive, if, as and when declared by the directors of Sensus, dividends in such amount and payable on such date as may be determined from time to time by the directors of Sensus. Subject to the preferential rights attaching to any other class or series of shares of Sensus, if any, on the liquidation, dissolution or winding-up of Sensus, or any other distribution of the assets of Sensus among its shareholders for the purpose of winding-up its affairs, the holders of the Sensus Shares shall be entitled to share, on a per share basis, the remaining property and assets of Sensus.

Dividends

Holders of Common Stock will be entitled to receive, when, as and if declared by the board of directors out of legally available funds, cash dividends. The Common Stock will not have priority as to

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dividends over any other series or class of the Company's stock that ranks senior as to dividends to the Common Stock.

Voting Rights

Holders of Common Stock shall have the right to one vote per share upon all matters presented for the vote of holders of the Common Stock.

Alberta Corp.

General

The authorized share capital of Alberta Corp. consists of an unlimited number of: (a) Class "A" Shares; (b) Class "B" Shares; and (c) Class "C" Preferred Shares. As of the date of this Prospectus, there are 10,000,000 issued and outstanding Class "A" Shares that were issued for aggregate consideration of $50,000 CDN. There are no Class "B" Shares issued and outstanding. There are no Class "C" Preferred Shares issued and outstanding. All of the Class "A" Shares issued and outstanding are fully paid and non-assessable.

The following is a general description of the material rights, privileges, restrictions and conditions which attach to each class of shares.

CLASS "A" SHARES OF ALBERTA CORP.

Subject to the provisions of the Alberta Business Corporations Act (the "ABCA"), the holders of the Class "A" Shares are entitled to receive notice of, to attend and vote at all meetings of the shareholders of Alberta Corp. (other than meetings of a class or series of shares other than the Class "A" Shares, as required under the ABCA) and are entitled to one vote for each Class "A" Share held, except as required by law.

Subject to the preferential rights attaching to any other class or series of shares of the corporation, the holders of the Class "A" Shares are entitled to receive, if, as and when declared by the directors of Alberta Corp., dividends in such amount and payable on such date as may be determined from time to time by the directors of Alberta Corp. No dividend may be declared or paid on the Class "A" Shares if payment of the dividend would cause the realizable value of the corporation's assets to be less than the aggregate of its liabilities and the amount required to redeem all shares of the corporation then outstanding having attached thereto a redemption or retraction right.

Subject to the preferential rights attaching to any other class or series of shares of the corporation, if any, on the liquidation, dissolution or winding-up of Alberta Corp., or any other distribution of the assets of Alberta Corp. among its shareholders for the purpose of winding-up its affairs, the holders of the Class "A" Shares shall be entitled to share, on a per share basis, the remaining property and assets of Alberta Corp.

CLASS "B" SHARES OF ALBERTA CORP.

Subject to the provisions of the ABCA, the holders of the Class "B" Shares are not entitled to receive notice of, to attend and/or vote at meetings of the shareholders of Alberta Corp.

Subject to the preferential rights attaching to any other class or series of shares of the corporation, the holders of the Class "B" Shares are entitled to receive, if, as and when declared by the directors of Alberta Corp., dividends in such amount and payable on such date as may be determined

46

from time to time by the directors of Alberta Corp. No dividend may be declared or paid on the Class "B" Shares if payment of the dividend would cause the realizable value of the corporation's assets to be less than the aggregate of its liabilities and the amount required to redeem all shares of the corporation then outstanding having attached thereto a redemption or retraction right.

Subject to the preferential rights attaching to any other class or series of shares of the corporation, if any, on the liquidation, dissolution or winding-up of Alberta Corp., or any other distribution of the assets of Alberta Corp. among its shareholders for the purpose of winding-up its affairs, the holders of the Class "A" Shares shall be entitled to share, on a per share basis, the remaining property and assets of Alberta Corp.

CLASS "C" PREFERRED SHARES OF ALBERTA CORP.

The Class "C" Preferred Shares may be issued from time to time in one or more series in the number and with the designation, rights, privileges, restrictions and conditions as determined by the directors of Alberta Corp. in their sole discretion. The Class "C" Preferred Shares will be entitled to preference, as to the payment of dividends and the distribution of the remaining property of Alberta Corp. on dissolution, over the Class "A" Shares and the Class "B" Shares.

Dividend

Alberta Corp. has not paid any dividends on its securities and has no present intention of paying dividends on its securities. The future payment of dividends will be dependent upon the financial requirements of Alberta Corp. to fund future growth, the financial condition of Alberta Corp. and other factors the Board of Directors of Alberta Corp. may consider appropriate in the circumstances.

ANTI-TAKEOVER EFFECTS OF VARIOUS PROVISIONS OF NEVADA LAW.

Upon the closing of this Offering, we will be subject to the provisions of Section 438 of the Nevada General Corporation Law. Subject to specific exceptions, Section 438 prohibits a publicly-held Nevada corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the transaction in which such stockholder became an "interested stockholder" is approved by the board of directors prior to the date the "interested stockholder" attained that status;

"Business combinations" include mergers, acquisitions, asset sales and other transactions resulting in a financial benefit to the "interested stockholder." Subject to various exceptions, an "interested stockholder" is a person who, together with his or her affiliates and associates, owns, or within three years did own, 15% or more of the corporation's voting stock. The restrictions in this statute could prohibit or delay the accomplishment of mergers or other takeover or change-in-control attempts with respect to the Company and, therefore, may discourage attempts to acquire us.

Limitations On Liability and Indemnification of Directors and Officers

Our Articles of incorporation contains the following provision with respect to indemnification of our directors and officers:

The personal liability of the directors of the Company is hereby eliminated to the fullest extent permitted by the provisions of Section 78.037 of the General Corporation Law of the State of Nevada, as the same may be amended or supplemented.

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This provision does not eliminate or limit the liability of a director for violating the following:

o duty of loyalty (which includes a director's obligation to refrain from self dealing with Sensus improperly competing with Sensus or usurping Sensus' opportunities);

o failing to act in good faith;

o engaging in intentional misconduct or knowingly violating a law; or

o participating in the payment of a dividend or a stock repurchase or redemption for himself.

This provision does not affect any director's liability under federal securities laws or the availability of equitable remedies such as an injunction or rescission for breach of fiduciary duty.

We intend to purchase directors' liability insurance for our officers and directors. However, there can be no assurance that such insurance will be available to us at commercially reasonable terms, or at all.

Authorized but Unissued Shares

The authorized but unissued shares of Common Stock is available for future issuance without stockholder approval. We may use these additional shares for a variety of corporate purposes, including future public offerings to raise additional capital, corporate acquisitions and employee benefit plans. The existence of authorized but unissued shares of Common Stock and preferred stock could render more difficult or discourage an attempt to obtain control of the Company by means of a proxy contest, tender offer, merger or otherwise.

SELLING SHAREHOLDERS

An aggregate of 10,156,500 Shares of Common Stock may be offered for resale by the Selling Security Holders. See "The Offering." These Shares of Common Stock include shares issued to the OM Security Holders pursuant to a private placement of shares consummated on February 10, 2000.

There are no material relationships between any of the Selling Shareholders and the Company or any of its predecessors or affiliates, nor have any such material relationships existed within the past three years.

TRANSFER AGENT AND REGISTRAR OF SENSUS

The transfer agent and registrar of the Company is

MARKET FOR TRADING OF SENSUS SHARES

The shares of Sensus are not listed on any exchange and there is currently no market for its shares.

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SHARES ELIGIBLE FOR FUTURE SALE

Currently, Sensus has 10,156,500 shares of Common Stock outstanding, and the Company intends to issue another 1,000,000 shares. All are intended to be registered pursuant to this registration statement and the 1,000,000 new shares to be issued will be freely transferable without restriction or further registration under the Securities Act.

The outstanding Common Stock are "restricted securities," as that term is defined in Rule 144 promulgated under the Securities Act, and may only be sold pursuant to an effective registration statement under the Securities Act, or in compliance with the exemption provisions of Rule 144 or pursuant to another exemption under the Securities Act.

In general, under Rule 144 as currently in effect, any person (or persons whose shares are aggregated) who has beneficially owned restricted securities for at least one year is entitled to sell, within any three-month period, a number of shares that does not exceed the greater of 1% of the then outstanding shares of the issuer's common stock or the average weekly trading volume during the four calendar weeks preceding such sale, provided that certain public information about the issuer as required by Rule 144 is then available and the seller complies with certain other requirements. Affiliates may sell unrestricted securities in compliance with Rule 144 subject to the holding period requirement. A person who is not an affiliate, has not been an affiliate within three months prior to sale, and has beneficially owned the restricted securities for at least two years, is entitled to sell such shares under Rule 144 without regard to any of the limitations described above.

Prior to this registration, there has been no public trading market for the Common Stock and we cannot predict the effect, if any, that public sales of shares of Common Stock or the availability of shares for sale will have on the market prices of the Common Stock and warrants. Nevertheless, the possibility that a substantial amount of Common Stock or warrants may be sold in the public market may adversely effect prevailing market prices and could impair our ability to raise capital through the sale of its equity securities.

PLAN OF DISTRIBUTION

The Selling Security Holders (or pledgees, donees, transferees or successors in interest) may sell all or a portion of the respective Secondary Shares held by them from time to time while the registration statement of which this Prospectus is a part remains effective. The aggregate proceeds to the Selling Security Holders from the sale of the respective Secondary Shares offered by the Selling Security Holders hereby will be the prices at which such securities are sold, less any commissions. There is no assurance that the Selling Security Holders will sell any or all of the Secondary Shares offered hereby.

The 1,000,000 Shares being offered in this Offering are being sold directly by the Company and without an underwriter. The Company intends to market the 1,000,000 Shares through general advertising medium but only in those states where the Offering is authorized. For information on how to subscribe, call (403) 242-9703 and ask for J. Timothy Bowes.

The Company intends to list its securities on the NASD OTC Bulletin Board and if it is successful, the Shares may be sold in transactions on the NASD OTC Bulletin Board, in negotiated transactions, or by a combination of these methods, at fixed prices that may be changed, at market prices prevailing at the time of sale, at prices related to such market prices or at negotiated prices or through the writing of options on the Secondary Shares. The Selling Security Holders may elect to engage a broker or dealer to effect sales in one or more of the following transactions:

49

(a) block trades in which the broker or dealer so engaged will attempt to sell the Secondary Shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;

(b) purchases by a broker or dealer as principal and resale by such broker or dealer for its account pursuant to this Prospectus; and

(c) ordinary brokerage transactions and transactions in which the broker solicits purchasers. In effecting sales, brokers and dealers engaged by the Selling Security Holders may arrange for other brokers or dealers to participate. Brokers or dealers may receive commissions or discounts from the Selling Security Holders in amounts to be negotiated (and, if such broker-dealer acts as agent for the purchaser of such Secondary Shares, from such purchaser). Broker-dealers may agree with the Selling Security Holders to sell a specified number of such Secondary Shares, at a stipulated price per share. To the extent that such broker-dealer is unable to sell all of the shares, it may, as agent for the Selling Security Holders, purchase the unsold shares as principal at the price required to fulfill the broker-dealer's commitment to the Selling Security Holders. Broker-dealers who acquire shares as principal may thereafter resell such shares from time to time in transactions (which may involve crosses and block transaction and sales to and through other broker-dealers, including transactions of the nature described above) in the over-the-counter market, or otherwise on terms then prevailing at the time of sale, at prices then related to the then-current market price or in negotiated transactions, and in connection with such resales, may pay to, or receive from, the purchasers of such shares, commissions as described above.

The Selling Security Holders and any broker-dealers or agents who participate in the sale of the shares may be deemed to be "underwriters" within the meaning of the Securities Act of 1933 in connection with such sales. In such event, any commissions received by such broker-dealers or agent and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act of 1933.

The Company will not pay any expenses related to the sale of such securities to the public.

The Selling Security Holders have been advised that during the time they are engaged in "distribution" (as defined under Regulation M under the Securities Exchange Act of 1934, as amended) of the securities covered by this Prospectus, they must comply with Regulation M under the Securities Exchange Act of 1934, as amended, and pursuant thereto: (i) shall not engage in any stabilization activity in connection with the Company's securities; and (ii) shall not bid for or purchase any securities of the Company or attempt to include any person to purchase any of the Company's securities other than as permitted under the Securities Exchange Act of 1934, as amended. Any Selling Security Holders who are "affiliated purchasers" of the Company, as defined in Regulation M, have been further advised that they and their affiliates must coordinate their sales under this Prospectus and otherwise with the Company and any other "affiliated purchasers" of the Company for purposes of Regulation M. The Selling Security Holders selling shares must also furnish each broker through which their securities are sold copies of this Prospectus.

LEGAL MATTERS

The validity of the shares of Common Stock offered by this Prospectus will be passed upon for us by Jeffer, Mangels, Butler & Marmaro LLP, Los Angeles, California.

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EXPERTS

The financial statements and schedules audited by Ernst & Young, LLP have been included in reliance on their report (which contains an explanatory paragraph describing conditions that raise substantial doubt about the Company's ability to continue as a going concern as described in note 1 to the consolidated financial statements) given with their authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the Securities and Exchange Commission a Registration Statement on Form SB-2, including exhibits, schedules and amendments to that registration statement, under the Securities Act with respect to the shares of Common Stock to be sold in this Offering. This Prospectus does not contain all the information included in our Registration Statement. For further information with respect to us and the shares of Common Stock to be sold in this Offering, we refer you to the Registration Statement. Statements contained in this Prospectus as to the contents of any contract, agreement or other document referred to are not necessarily complete, and in each instance we refer you to the copy of that contract, agreement or other document to the extent filed as an exhibit to the Registration Statement.

You may read and copy all or any portion of the Registration Statement or any other information we file at the Securities and Exchange Commission's public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. You can request copies of these documents, upon payment of a duplicating fee, by writing to the Securities and Exchange Commission. Please call the Securities and Exchange Commission at 1-800-SEC-0330 for further information on the operation of the public reference room. Our Securities and Exchange Commission filings, including the Registration Statement, are also available to you over the Internet on the Securities and Exchange Commission's Web site located at http://www.sec.gov. As a result of this Offering, we will become subject to the information and reporting requirements of the Exchange Act and, in accordance with the Exchange Act, we will file periodic reports, proxy statements and other information with the Securities and Exchange Commission. Upon approval of the Common Stock for quotation on the Nasdaq SmallCap Market those reports, proxy statements and other information may also be inspected at the offices of [Nasdaq Operations, 1735 K Street, N.W., Washington, D.C. 20006. We intend to furnish our stockholders with annual reports containing audited financial statements and with quarterly reports for the first three quarters of each fiscal year containing unaudited interim financial information.

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TABLE OF CONTENTS OF FINANCIAL INFORMATION

Page

Auditor's Report of SENSUS CAPITAL CORP.

Audited Consolidated Financial Statements of SENSUS CAPITAL CORP.

Notes to Financial Statements of SENSUS CAPITAL CORP.

CONSOLIDATED FINANCIAL STATEMENTS
(A DEVELOPMENT STAGE COMPANY)

SENSUS CAPITAL CORP.

FEBRUARY 18, 2000

INDEPENDENT AUDITORS' REPORT

To the Board of Directors of
SENSUS CAPITAL CORP.

We have audited the accompanying consolidated balance sheet of SENSUS CAPITAL CORP. (a development stage company) (and its subsidiary) as of February 18, 2000, and May 26, 1999 and the related statements of loss and deficit, changes in stockholders' equity and cash flows from the date of commencement of operations on May 27, 1999 to February 18, 2000. These financial statements are the responsibility of the Corporation's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audits in accordance with auditing standards generally accepted in the United States. 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 Sensus Capital Corp. (a development stage company) (and its subsidiary) as of February 18, 2000, and May 26, 1999 and the consolidated results of their operations and their cash flows for the period from date of commencement of operations on May 27, 1999 to February 18, 2000 in conformity with accounting principles generally accepted in the United States.

As discussed in Note 1 to the financial statements, the Corporation's loss from operations raise substantial doubts about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. 

Calgary, Canada                                           /s/ Ernst & Young LLP
February 20, 2000                                         Chartered Accountants
(except for note 12
which is as at
March 23, 2000)

SENSUS CAPITAL CORP.
(a development stage company)

CONSOLIDATED BALANCE SHEETS
(all amounts are expressed in U.S. dollars)

(see basis of presentation - note 1) 

                                                                   FEBRUARY 18,      MAY 26,
                                                                       2000            1999
                                                                        $               $

ASSETS
CURRENT
Cash                                                                   83,351          34,270
Stock subscriptions receivable                                          6,000              --
Prepaid expenses and deposits                                           5,000              --
                                                                      -------          ------
                                                                       94,351          34,270
                                                                      -------          ------
Goodwill, net of $9,104 accumulated amortization [note 4]              15,173              --
                                                                      -------          ------
                                                                      109,524          34,270
                                                                      =======          ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued liabilities                                7,077              --
                                                                      -------          ------
                                                                        7,077              --
                                                                      -------          ------
COMMITMENTS & CONTINGENCIES (note 1 and 11)
STOCKHOLDERS' EQUITY
Authorized
25,000,000 common shares at $0.001 par value
Common stock issued and paid-up [note 5]                               10,157          34,270
Additional paid in capital  [note 5]                                  113,401              --
Deficit accumulated during the development stage                      (21,111)             --
                                                                      -------          ------
                                                                      102,447          34,270
                                                                      -------          ------
                                                                      109,524          34,270
                                                                      =======          ======

See accompanying notes 

On behalf of the Board:       /s/ J. TIMOTHY BOWES        /s/ STEFAN SCOTT
                                    Director                  Director

SENSUS CAPITAL CORP.
(a development stage company)

CONSOLIDATED STATEMENTS OF LOSS AND DEFICIT
(all amounts are expressed in U.S. dollars) 

                                                                               PERIOD FROM MAY
                                                                                 27, 1999 TO
                                                                              FEBRUARY 18, 2000
                                                                                      $

REVENUE                                                                                  --
                                                                                 ----------
EXPENSES
General and administrative                                                           12,007
Amortization                                                                          9,104
                                                                                 ----------
                                                                                     21,111
                                                                                 ----------
NET LOSS AND ENDING DEFICIT FOR THE PERIOD [NOTE 7]                                  21,111
                                                                                 ----------
Net loss per common share [note 7]                                                   --
Weighted average number of shares outstanding                                    10,026,944
                                                                                 ==========

See accompanying notes

SENSUS CAPITAL CORP.
(a development stage company)

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(all amounts are expressed in U.S. dollars) 

                                                    NUMBER OF   COMMON STOCK    CAPITAL IN          TOTAL
                                                     SHARES       PAR VALUE    EXCESS OF PAR     STOCKHOLDERS'
                                                   ----------                     VALUE             EQUITY
                                                                       $            $                 $
                                                                 ------------  -------------     ------------
BALANCE, MAY 26, 1999 -
Founder's shares of 830245 Alberta Ltd. [NOTE 3]     10,000,000      34,270         --              34,270


June 21, 1999 change in shares and
share capital as a result of reverse
acquisition [note 3]                                      7,500     (24,262)       51,397            27,135
                                                     ----------      ------       -------           -------
   BALANCE JUNE 21, 1999                             10,007,500      10,008        51,397            61,405
                                                     ----------      ------       -------           -------
   Common stock issued for services
   [note 11]                                             25,000          25           128               153
   Common stock issued for cash                         124,000         124        61,876            62,000
                                                     ----------      ------       -------           -------
   BALANCE, FEBRUARY 18, 2000                        10,156,500      10,157       113,401           123,558
                                                     ==========      ======       =======           =======

See accompanying notes

SENSUS CAPITAL CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(all amounts are expressed in U.S. dollars) 

                                                                    PERIOD FROM MAY 27, 1999 TO
                                                                         FEBRUARY 18, 2000
                                                                                 $
                                                                    ---------------------------

CASH FLOWS USED IN OPERATING ACTIVITIES
Net loss for the period                                                            (21,111)
Adjustments to reconcile loss to cash flows used in operating
activities:
Amortization of goodwill                                                             9,104
Marketing expense not involving the payment of cash [note 5]                           153
Changes in non-cash working capital balances [note 8]                              (11,065)
                                                                                   -------
                                                                                   (22,919)
                                                                                   -------

CASH FLOWS GENERATED BY FINANCING ACTIVITIES
Proceeds from the issuance of common stock                                          62,000
                                                                                   -------
                                                                                    62,000
                                                                                   -------
CASH FLOWS USED IN  INVESTING ACTIVITIES
Cash acquired on acquisition of subsidiary [note 3]                                 10,000
                                                                                   -------
                                                                                    10,000
                                                                                   -------
INCREASE IN CASH                                                                    49,081
Cash, beginning of period                                                           34,270
                                                                                   -------
CASH, END OF PERIOD                                                                 83,351
                                                                                   =======

See accompanying notes

SENSUS CAPITAL CORP.
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(all amounts are expressed in U.S. dollars)

May 27, 1999 to February 18, 2000

1. BASIS OF PRESENTATION AND GOING CONCERN UNCERTAINTY

Sensus Capital Corp., ("Sensus" or the "Corporation") was incorporated on May 21, 1999 under the laws of the State of Nevada, and was inactive from the date of incorporation to May 26, 1999. On June 21, 1999, the Corporation purchased all of the outstanding shares of 830245 Alberta Ltd. which has been accounted for as a reverse takeover (see Note 3). Accordingly the comparative balance sheet as at May 26, 1999 in the accompanying financial statements is that of 830245 Alberta Ltd.

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the financial statements, the Corporation has incurred a significant operating loss, and net operating cash outflows of $22,919 for the period from May 27, 1999 to February 18, 2000. The Corporation's continuation as a going concern is dependent on its ability to generate sufficient cash flow, to meet its obligations on a timely basis, to obtain additional financing as may be required, and ultimately to attain successful operations. However, no assurance can be given at this time as to whether the Corporation will achieve any of these conditions. These factors, among others, raise substantial doubt about the Corporation's ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Corporation be unable to continue as a going concern.

Management intends to seek additional financing through future private or public offerings of stock.

The accompanying financial statements reflect all adjustments which are, in the opinion of management, necessary to reflect a fair presentation for the periods being presented.

2. SIGNIFICANT ACCOUNTING POLICIES

The financial statements have, in management's opinion, been properly prepared in accordance with accounting principles generally accepted in the United States.

USE OF ESTIMATES

Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which would affect the amount of recorded assets, liabilities, revenues and expenses. Actual amounts could differ from these estimates.

SENSUS CAPITAL CORP.
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(all amounts are expressed in U.S. dollars)

May 27, 1999 to February 18, 2000

CONSOLIDATION

The consolidated financial statements include the accounts of the Corporation and its wholly owned subsidiary, 830245 Alberta Ltd., an Alberta, Canada corporation ("830245"), after elimination of intercompany accounts and transactions.

LONG-LIVED ASSETS

The Corporation follows financial Accounting Standards Board Statement No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be disposed of," which requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present.

GOODWILL

Goodwill is recorded at cost and is being amortized on a straight-line basis over two years. The recoverability of goodwill is assessed periodically based on management estimates of undiscounted future operating income from each of the acquired businesses to which the goodwill relates.

INCOME TAXES

The Corporation follows the liability method of accounting for the tax effect of temporary differences between the carrying amount and the tax basis of the company's assets and liabilities. Temporary differences arise when the realization of an asset or the settlement of a liability would give rise to either an increase or decrease in the Corporation's income taxes payable for the year or later period. Deferred income taxes are recorded at the income tax rates that are expected to apply when the deferred tax liability is settled or the deferred tax asset is realized. When necessary, valuation allowances are established to reduce deferred income tax assets to the amount expected to be realized. Income tax expense is the tax payable for the period and the change during the period in deferred income tax assets and liabilities.

FOREIGN CURRENCY TRANSLATION

The functional currency of the Corporation is the Canadian dollar. Accordingly, assets and liabilities are translated at the year-end exchange rate and revenues and expenses are translated at average exchange rates. Gains and losses arising from the translation of the financial statements are recorded in a "Cumulative Translation Adjustment" account in stockholders' equity.

SENSUS CAPITAL CORP.
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(all amounts are expressed in U.S. dollars)

May 27, 1999 to February 18, 2000

EARNINGS (LOSS) COMMON SHARE

The loss per common share has been calculated based on the weighted average number of common shares outstanding during the period. Diluted earnings per share, assuming all warrants, options and conversion features were exercised, does not differ from basic earnings per share.

3. ACQUISITION

On June 21, 1999 the Corporation purchased all of the outstanding common shares of 830245 in exchange for 10,000,000 Sensus shares to the shareholders of 830245 Alberta Ltd., on the basis of 1 Sensus share for each Class "A" share of 830245.

The purchase of 830245 Alberta Ltd. shares has been accounted for as a reverse acquisition by 830245 of Sensus, and has been recorded using the purchase method of accounting whereby the purchase price in excess of the carrying value of the net assets acquired has been allocated to goodwill. 

                                                                                   PURCHASE
                                                                                  ALLOCATION
                                                                                       $
                                                                                  ----------
Cash                                                                                 10,000
Goodwill                                                                             24,276
                                                                                  ----------
Purchase price                                                                       34,276
                                                                                  ==========

Legal and audit fees of $7,141 incurred to complete the reverse acquisition, have been allocated to goodwill.

The operating results of Sensus are included in the consolidated statements of loss and deficit from the date of acquisition.

SENSUS CAPITAL CORP.
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(all amounts are expressed in U.S. dollars)

May 27, 1999 to February 18, 2000

4. GOODWILL 

                                                                FEBRUARY 18, 2000
                                                    -----------------------------------------
                                                                   ACCUMULATED     NET BOOK
                                                     COST          AMORTIZATION      VALUE
---------------------------------------------------------------------------------------------
Goodwill                                            24,276            9,104            15,173
---------------------------------------------------------------------------------------------

5. SHARE CAPITAL

AUTHORIZED

25,000,000 common shares at $0.001 par value

COMMON STOCK ISSUED

During the period ended February 18, 2000, the Corporation issued 25,000 common stock pursuant to the terms of the agreement described in note 11. The shares were recorded at book value as the fair market value was undeterminable.

6. EARNINGS (LOSS) PER SHARE

Loss per common share is loss for the period divided by the weighted average number of common shares outstanding.

7. INCOME TAXES

The income tax benefit differs from the amount computed by applying the U.S. federal statutory tax rates to the loss before income taxes for the following reasons: 

                                                                                    FEBRUARY 18,
                                                                                        2000
                                                                                          $
------------------------------------------------------------------------------------------------
   Income tax benefit at U.S. statutory rate (34%)
   Increase (decrease) in taxes resulting from:                                         (7,178)
------------------------------------------------------------------------------------------------
     Change in deferred tax asset valuation allowance                                    7,178
   Income tax benefit                                                                       --
================================================================================================

SENSUS CAPITAL CORP.
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(all amounts are expressed in U.S. dollars)

May 27, 1999 to February 18, 2000

For financial reporting purposes, loss before income taxes includes the following components: 

                                                                                  FEBRUARY 18,
                                                                                      2000
                                                                                        $
                                                                                  -----------
Pre-tax loss:
United States                                                                         21,111
Foreign                                                                                   --
                                                                                  -----------
                                                                                      21,111
                                                                                  ===========

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The components of the Company's deferred tax assets are as follows: 

                                                                               FEBRUARY 18,
                                                                                   2000
                                                                                     $
                                                                          ------------------


Deferred tax assets (liabilities):
Net operating loss carryforwards                                                      4,633
Amortization                                                                          2,545
                                                                                  -----------
Net deferred tax assets                                                               7,178
Valuation allowance                                                                  (7,178)
                                                                                  -----------
Net deferred tax assets                                                                  --
                                                                                  ===========

The Company has provided a valuation allowance for the full amount of deferred tax assets in light of its history of operating losses since its inception.

The Company has U.S. operating losses carried forward of $13,625 which expire as follows:

$
2020 13,625

The availability of these loss carryforwards to reduce future taxable income could be subject to limitations under the Internal Revenue Code of 1986, as amended. Certain ownership changes can significantly limit the utilization of net operating loss carryforwards in the period following the ownership change. The Company has not determined whether such changes have occurred and the effect such changes could have on its ability to carry forward all or some of the U.S. net operating losses.

SENSUS CAPITAL CORP.
(a development stage company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(all amounts are expressed in U.S. dollars)

May 27, 1999 to February 18, 2000

8. NET CHANGE IN NON-CASH WORKING CAPITAL 

                                                                                    FEBRUARY 18,
                                                                                        2000
                                                                                         $
                                                                                     -----------
Stock subscription receivable                                                             (6,000)
Prepaid expenses and deposits                                                             (5,000)
Accounts payable and accrued liabilities                                                     (65)
                                                                                     -----------
Change relating to operating activities                                                  (11,065)
                                                                                     ===========

9. FINANCIAL INSTRUMENTS

Financial instruments comprising cash, stock subscription receivable, accounts payable and accrued liabilities, approximate their fair value. It is management's opinion that the Corporation is not exposed to significant currency or credit risks arising from these financial instruments.

10. RECENT PRONOUNCEMENTS

In June, 1998, the FASB issued SFAS No. 133, "Accounting for Derivatives and Hedging Activities", which will be effective for fiscal years beginning after June 15, 2000. The Corporation does not acquire derivatives or engage in hedging activities.

11. COMMITMENT

In July 1999, the Corporation signed an agreement with Allteam Online Inc. ("AOI") to develop and operate an internet web site in exchange for 25,000 common shares of the Corporation (which were issued during the period ended February 18, 2000) and payments of $25,000 per month, commencing on or before December 31, 2000. Once developed, the Corporation is required to pay AOI a management fee equal to 10% of gross revenues.

12. SUBSEQUENT EVENT

On March 23, 2000 the Corporation issued a prospectus and filed a Form SB-2 Registration Statement with the U.S. Securities and Exchange Commission to seek registration of 11,156,500 shares of its common stock, including 1,000,000 shares to be issued and sold by the Corporation pursuant to such registration.

PROSPECTIVE INVESTORS MAY RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. SENSUS CAPITAL CORP. HAS NOT AUTHORIZED ANYONE TO PROVIDE PROSPECTIVE INVESTORS WITH DIFFERENT OR ADDITIONAL INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL NOR IS IT SEEKING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. THE INFORMATION CONTAINED IN THIS PROSPECTUS IS CORRECT ONLY AS OF THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF THE DELIVERY OF THIS PROSPECTUS OR ANY SALE OF THESE SECURITIES.

NO ACTION IS BEING TAKEN IN ANY JURISDICTION OUTSIDE THE US TO PERMIT A PUBLIC OFFERING OF THE COMMON STOCK OR POSSESSION OR DISTRIBUTION OF THIS PROSPECTUS IN ANY OF THESE JURISDICTIONS. PERSONS WHO COME INTO POSSESSION OF THIS PROSPECTUS IN JURISDICTIONS OUTSIDE THE US AND CANADA ARE REQUIRED TO INFORM THEMSELVES ABOUT AND TO OBSERVE THE RESTRICTIONS OF THAT JURISDICTION RELATED TO THIS OFFERING AND THE DISTRIBUTION OF THIS PROSPECTUS.

TABLE OF CONTENTS

Page

Prospectus Summary....................................... Risk Factors............................................. Use of Proceeds.......................................... Dividend Policy.......................................... Capitalization........................................... Dilution................................................. Selected Financial Data.................................. Management's Discussion and Analysis of Financial Condition and Results of Operations...................... Business................................................. Management............................................... Principal Stockholders................................... Transactions with Management and Others.................. Description of Capital Stock............................. Selling Shareholders..................................... Registration Rights...................................... Shares Eligible for Future Sale.......................... Underwriting............................................. Legal Matters............................................ Experts.................................................. Where You Can Find More Information......................

Index to Financial Statements............................

Dealer Prospectus Delivery Obligation:

Until April 17, 2000 (25 days after the date of this Prospectus), all dealers that buy, sell or trade these shares of Common Stock, whether or not participating in this Offering, may be required to deliver a Prospectus. This is in addition to the dealers' obligation to deliver a Prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

11,156,500 SHARES

SENSUS CAPITAL CORP.

COMMON STOCK

PROSPECTUS

MARCH 23, 2000

52

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table indicates the expenses to be incurred in connection with the Offering described in this Registration Statement, all of which will be paid by the Company. All amounts are estimates, other than the Securities and Exchange Commission registration fee, the National Association of Securities Dealers, Inc. fee and the [Nasdaq] listing fee. 

Securities and Exchange Commission registration fee.................................................... $_____
National Association of Securities Dealers, Inc. fee................................................... $_____
Accounting fees and expenses........................................................................... $_____
Legal fees and expenses................................................................................ $_____
Director and officer insurance expenses................................................................ $_____
Printing and engraving expenses........................................................................ $_____
Transfer agent and registrar fees and expenses......................................................... $_____
Blue Sky fees and expenses (including counsel fees).................................................... $_____
Miscellaneous expenses................................................................................. $_____

          Total........................................................................................ $_____

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Article VII of the Company's Certificate of Incorporation, contains the following provision with respect to the indemnification of directors of the Company:

Every person who was or is a party to, or is threatened to be made a party to, or is involved in any such action, suit or proceeding, whether civil, criminal, administrative or investigative, by the reason of the fact that he or she, or a person with whom he or she is a legal representative, is or was a director of the corporation, or who is serving at the request of the corporation as a director or officer of another corporation, or is a representative in a partnership, joint venture, trust or other enterprise, shall be indemnified and held harmless to the fullest extent legally permissible under the laws of the State of Nevada from time to time against all expenses, liability and loss (including attorneys' fees, judgements, fines, and therewith. Such right of indemnification shall be a contract right which may be enforced in any manner desired by such person. The expenses of officers and directors incurred in defending a civil suit or proceeding must be paid by the corporation as incurred and in advance of the final disposition of the action, suit, or proceeding, under receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that he or she is not entitled to be indemnified by the corporation. Such right of indemnification shall not be exclusive of any other right of such directors, officers or representatives may have or hereafter acquire, and, without limiting the generality of such statement, they shall be entitled to their respective rights of indemnification under any bylaw, agreement, vote of stockholders, provision of law, or otherwise, as well as their rights under this article.

Without limiting the application of the foregoing, the Board of Directors may adopt By-Laws from time to time without respect to indemnification, to provide at all times the fullest indemnification permitted by the laws of the State of Nevada, and may cause the corporation to purchase or maintain insurance on behalf of any person who is or was a director or officer.

The Company's By-laws do not contain any specific provisions with respect to the indemnification of directors, officers and authorized representatives:

53

The Board of Directors may from time to time adopt further Bylaws with respect to indemnification and may amend these and such Bylaws to provide at all times the fullest indemnification permitted by the General Corporation Law of the State of Nevada. It is the intention of the Board of Directors to amend the by-laws as soon as possible.

The Nevada Revised Corporate and Securities Statutes also contain provisions entitling directors and officers of the corporation to indemnification from judgments, fines, amounts paid in settlement and reasonable expenses, including attorneys' fees, as the result of an action or proceeding in which they may be involved by reason of being or having been a director or officer of the corporation (or, at the request of the corporation, a director or officer of another corporation or other enterprise); provided the officers or directors acted in good faith. The corporation also may obtain an insurance policy which will cover officers and directors for any liability arising out of their actions in such capacity.

The foregoing do not and will not eliminate or limit the liability of a director for violating his duty of loyalty (which includes the obligation of a director of the corporation to refrain from self-dealing with respect to the corporation, improperly competing with the corporation or usurping corporation opportunities), failing to act in good faith, engaging in intentional misconduct or knowingly violating a law or participating in the payment of a dividend or a stock repurchase or redemption for himself. The foregoing also do not and will not affect any director's liability under federal securities laws or the availability of equitable remedies such as an injunction or rescission for breach of fiduciary duty.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(A) EXHIBITS 

Exhibit
Number                                               Description

3.1(a)              Articles of Incorporation of Sensus.
3.1(b)              Articles of Incorporation of Alberta Corp.
3.2(a)              By-laws of Sensus.
3.2(b)              By-laws of Alberta Corp.
4.                  Stock Certificate specimen of the Company.
5.                  Opinion of Jeffer, Mangels, Butler & Marmaro LLP. (*)
10.1                AOI Acquisition Agreement
10.2                TargetCo Acquisition Agreement.

23.1                Consent of Ernst & Young.
23.2                Consent of Jeffer, Mangels, Butler & Marmaro LLP.
 24.                Power of attorney (included on the Signature Page).
-------------------------------

(*) To be filed by amendment.

ITEM 17. UNDERTAKINGS.

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:

(i) To include any Prospectus required by section 10(a)(3) of the Securities Act of 1933;

54

(ii) To reflect in the Prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually, or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement; notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of Prospectus filed with the Commission pursuant to Rule 424(b) (? 230.424(b) of this Chapter) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate Offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement.

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new Registration Statement relating to the securities offered therein, and the Offering of such securities at that time shall be deemed to be the initial bona fide Offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the Offering.

Insofar as indemnification for liabilities arising from the Securities Act of 1933 (the "Act") may be permitted to directors, officers, and controlling persons of the Registrant, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of Prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of Prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or Rule 497(h) under the Act shall be deemed to be part of this Registration Statement as of the time it was declared effective.

For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of Prospectus shall be deemed to be a new Registration Statement relating to the securities offered therein, and the Offering of such securities at that time shall be deemed to be the initial bona fide Offering thereof.

55

SIGNATURES

In accordance with the requirements of the Securities Act of 1933, we certify that we have reasonable grounds to believe that we meet all of the requirements of filing on Form SB-2 and authorize this registration statement to be signed on our behalf by the undersigned, in Calgary, Alberta, on March 23, 2000.

SENSUS CAPITAL CORP. 

By: /s/ J. Timothy Bowes
    ---------------------------
    J. Timothy Bowes, President,
    Chief Executive Officer

By: /s/ Stefan Scott
    ---------------------------
    Stefan Scott, Director

POWER OF ATTORNEY

We, the undersigned officers and directors of SENSUS CAPITAL CORP., hereby severally constitute and appoint Stefan Scott and J. Timothy Bowes, and each of them (with full power to each of them to act alone), our true and lawful attorneys-in-fact and agents, with full power of substitution, for us and in our stead, in any and all capacities, to sign any and all amendments (including pre-effective and post-effective amendments) to this registration statement and all documents in connection thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing necessary or advisable to be done in and about the premises, as full to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all the said attorneys-in-fact and agents, or any of them, or their substitute or substitutes may lawfully do or cause to be done by virtue hereof.

In accordance with the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates stated. 

NAME                             TITLE                            DATE


/s/ J. Timothy Bowes             President, Chief Executive       March 23, 2000
-----------------------------    Officer, Secretary, Treasurer
    J. Timothy Bowes             and Director


/s/ Stefan Scott                 Director                         March 23, 2000
-----------------------------
    Stefan Scott

56 
                                 Exhibit Index

3.1(a)              Articles of Incorporation of Sensus.
3.1(b)              Articles of Incorporation of Alberta Corp.
3.2(a)              By-laws of Sensus.
3.2(b)              By-laws of Alberta Corp.
4.                  Stock Certificate specimen of the Company.
5.                  Opinion of Jeffer, Mangels, Butler & Marmaro LLP. (*)
10.1                AOI Acquisition Agreement
10.2                TargetCo Acquisition Agreement.

23.1                Consent of Ernst & Young.
23.2                Consent of Jeffer, Mangels, Butler & Marmaro LLP.
 24.                Power of attorney (included on the Signature Page).
-------------------------------

(*) To be filed by amendment.

Exhibit 3.1(a)

ARTICLES OF INCORPORATION
OF
SENSUS CAPITAL CORP.

1. NAME OF COMPANY:

Sensus Capital Corp.

2. RESIDENT AGENT: 

The resident agent of the Company is:    Campbell Mello Associates, Inc.
                                         3110 S. Valley View, Suite 105
                                         Las Vegas, Nevada 89102

3. BOARD OF DIRECTORS:

The Company shall initially have one director (1) who is John S. Huckell, Ste. 500, Scotia One, 10600 Jasper Ave.; Edmonton, AB T5J 3R8. This individual shall serve as director until their successor or successors have been elected and qualified. The number of directors may be increased or decreased by a duly adopted amendment to the By-Laws of the Corporation.

4. AUTHORIZED SHARES:

The aggregate number of shares which the corporation shall have authority to issue shall consist of 25,000,000 shares of Common Stock having a $.001 par value. The Common Stock of the Company may be issued from time to time without prior approval by the stockholders. The Common Stock may be issued for such consideration as may be fixed from time to time by the Board of Directors. The Board of Directors may issue such share of Common and/or Preferred Stock in one or more series, with such voting shares, designations, preferences and rights or qualifications, limitations or restrictions thereof as shall be stated in the resolution or resolutions.

5. PREEMPTIVE RIGHTS AND ASSESSMENT OF SHARES:

Holders of Common Stock or Preferred Stock of the corporation shall not have any preference, preemptive right or right of subscription to acquire shares of the corporation authorized, issued, or sold, or to be authorized, issued or sold, or to any obligations or shares authorized or issued or to be authorized or issued, and convertible into shares of the corporation, nor to any right of subscription thereto, other than to the extent, if any, the Board of Directors in its sole discretion, may determine from time to time.

The Common Stock of the Corporation, after the amount of the subscription price has been fully paid in, in money, property or services, as the directors shall determine, shall not be subject to assessment to pays the debts of the corporation, nor for any other purpose, and no Common Stock issued as fully paid shall ever be assessable or assessed, and the Articles of Incorporation shall not be amended to provide for such assessment.

6. DIRECTORS' AND OFFICERS LIABILITY

A director or officer of the corporation shall be personally liable to this corporation or its stockholders for damages for breach of fiduciary duty as a director or officer, but this Article shall not eliminate or limit the liability of a director or officer for (i) acts or omissions which involve intentional misconduct, fraud or a knowing violation of the law or (ii) the unlawful payment of dividends. Any repeal or modification of this Article by stockholders of the corporation shall be prospective only, and shall not adversely affect an limitation on the personal liability of a director or officer of the corporation for acts or omissions prior to such repeal or modification.

7. INDEMNITY

Every person who was or is a party to, or is threatened to be made a party to, or is involved in any such action, suit or proceeding, whether civil, criminal, administrative or investigative, by the reason of the fact that he or she, or a person with whom he or she is a legal representative is or was a director of the corporation, or who is serving at the request of the corporation as a director or officer of another corporation or is a representative in a partnership, joint venture, trust or other enterprise, shall be indemnified and held harmless to the fullest extent legally permissible under the laws of the State of Nevada from time to time against all expenses, liability and loss (including attorneys' fees, judgements, fines, and amounts paid or to be paid in a settlement) reasonably incurred or suffered by him or her in connection therewith. Such right of indemnification shall be a contract right which may be enforced in any manner desired by such person. The expenses of officers and directors incurred in defending a civil suit or proceeding must be paid by the corporation as incurred and in advance of the final disposition of the action, suit, or proceeding, under receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that he or she is not entitled to be indemnified by the corporation. Such right of indemnification shall not be exclusive of any other right of such directors, officers or representatives may have or hereafter acquire, and, without limiting the generality of such statement, they shall be entitled to their respective rights of indemnification under any bylaw, agreement, vote of stockholders provision of law, or otherwise, as well as their rights under this article.

Without limiting the application of the foregoing, the Board of Directors may adopt By-Laws form time to time without respect to indemnification, to provide at all times the fullest indemnification permitted by the laws of the State of Nevada, and may cause the corporation to purchase or maintain insurance on behalf of any person who is or was a director or officer.

8. AMENDMENTS

Subject at all times to the express provisions of Section 5 on the Assessment of Shares, this corporation reserves the right to amend, alter, change, or repeal any provision contained in these Articles of Incorporation or its By-Laws, in the manner now or hereafter prescribed by statute or the Articles of Incorporation or said By-Laws, and all rights conferred upon shareholders are granted subject to this reservation.

9. POWER OF DIRECTORS

In furtherance, and not in limitation of those powers conferred by statute, the Board of Directors is expressly authorized:

(a) Subject to the By-Laws, if any, adopted by the shareholders, to make, alter or repeal the By-Laws of the corporation;

(b) To authorize and caused to be executed mortgages and liens, with or without limitations as to amount, upon the real and personal property of the corporation;

(c) To authorize the guaranty by the corporation of the securities, evidences of indebtedness and obligations of other persons, corporations or business entities;

(d) To set apart out of any funds of the corporation available for dividends a reserve or reserves for any proper purpose and to abolish any such reserve;

(e) By resolution adopted by the majority of the whole board, to designate one or more committees to consist of one or more directors of the of the corporation, which, to the extent provided on the resolution or in the By-Laws of the corporation, shall have and may exercise the powers of the Board of Directors in the management of the affairs of the corporation, any may authorize the seal of the corporation to be affixed to all papers which may require it. Such committee or committees shall have name and names as may be stated in the By-Laws of the corporation or as may be determined from time to time by resolution adopted by the Board of Directors.

All the corporate powers of the corporation shall be exercised by the Board of Directors except as otherwise herein or in the By-Laws or by law.

IN WITNESS WHEREOF, I hereunder set my hand on Thursday, May 20, 1999, hereby declaring and certifying that the facts stated hereinabove are true.

SIGNATURE OF INCORPORATOR 

Name:     Thomas C. Cook Esq.
Address:  3110 S. Valley View, Suite 105
          Las Vegas, Nevada 89102

SIGNATURE: /S/ THOMAS C. COOK ESQ.

STATE OF NEVADA )
COUNTY OF CLARK )

This instrument was acknowledged before me on May 20, 1999, by Thomas C. Cook. 

/S/ MATTHEW J. BLEVINS
Notary Public Signature

CERTIFICATE OF ACCEPTANCE OF APPOINTMENT AS RESIDENT AGENT: I, Ted D. Campbell
II, as a principal of Nevada Internet Corporation Enterprises, Inc.'' (NICE),
hereby accept appointment of NICE as the resident agent for the above referenced
company.

                      SIGNATURE: /S/ ANTHONY M. MELLO III

SECRETARY OF STATE

[SEAL OF THE STATE OF NEVADA]

STATE OF NEVADA

CORPORATE CHARTER

I, DEAN HELLER, the duly elected and qualified Nevada Secretary of State, do hereby certify that SENSUS CAPITAL CORP. did on MAY 21, 1999, file in this office the original Articles of Incorporation; that said Articles are now on file and of record in the office of the Secretary of State of the State of Nevada, and further, that said Articles contain all the provisions required by the law of said State of Nevada.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Great Seal of State, at my office, in Las Vegas, Nevada, on MAY 21, 1999. 

                                        /s/ DEAN HELLER

                                        Secretary of State
[SEAL OF THE STATE OF NEVADA]

By [SIGNATURE ILLEGIBLE]

Certification Clerk

Exhibit 3.1(b) 

                            Articles of Incorporation
                                       For
                               830245 ALBERTA LTD.

CLASSES OF SHARES:                  SEE ATTACHED SCHEDULE "A"

NUMBER OF DIRECTORS:

MAXIMUM NUMBER OF DIRECTORS:        9

MINIMUM NUMBER OF DIRECTORS:        1

RESTRICTIONS ON BUSINESS TO:        NONE

RESTRICTIONS ON BUSINESS FROM:      NONE

RESTRICTIONS ON SHARE TRANSFERS:    SEE ATTACHED SCHEDULE "B"

OTHER RULES OR PROVISIONS:          SEE ATTACHED SCHEDULE "C"

REGISTRATION AUTHORIZED BY:         JOHN S. HUCKELL
                                    AGENT OF CORPORATION

SCHEDULE A TO THE ARTICLES OF INCORPORATION SHARE STRUCTURE SECTION

1 CLASSES

The Corporation is authorized to issue an unlimited number of each of the following classes of shares: (a) Class "A" Common - One (1) class of voting shares to be designated as Class "A" Common shares;

(b) Class "B" Common - One (1) class of non-voting shares to be designated as Class "B" Common shares;

(c) Class "C" Preferred - One (1) class of shares issuable in series, to be designated as Class "C" Preferred shares, with the rights, privileges, restrictions and conditions attaching to each series, to be determined by the Board of Directors before the issuance of the first shares in each series of shares in such class, subject to the limitations contained in the Act and these articles.

SECTION 2 - INTERPRETATION In these Articles;

(a) "Act" means the Business Corporations Act of Alberta, as amended from time to time, or any legislation substituted therefore;

(b) "common shares" means the shares of the Corporation of classes that have a designation that includes the word "Common";

(c) "preferred shares" means the shares of the Corporation of classes that have a designation that includes the word "Preferred";

(d) "redeemable share" has the meaning set forth in the Act although, for the purposes of interpretation in the event that the word "retract" or any derivation of that word is ever used in relation to shares, a "retractable share" means a share issued by the Corporation that the Corporation, by these Articles, is required to purchase or redeem on the demand of a shareholder, and to "retract" means to so demand.

(e) words and expressions defined in the Act have the same meaning when used in these Articles unless inconsistent with that meaning in the context of these Articles.

SECTION 3 - CLASS RIGHTS, PRIVILEGES, RESTRICTIONS & CONDITIONS

3. The rights, privileges, restrictions and conditions attaching to the shares of the Corporation are as follows:

3.1 COMMON SHARES

3.1.1 The holders of Class "A" Common shares shall be entitled to vote in person or by proxy at any meeting of the shareholders of the Corporation or otherwise.

3.1.2 Except as is otherwise specifically provided in the Act, the holders of Class "B" Common shares shall not be entitled to attend or vote in person or by proxy at any meeting of the shareholders of the Corporation or otherwise.

3.1.3 At the discretion of the directors of the Corporation, dividends may be declared and paid from time to time out of the monies of the Corporation properly applicable to the payment of dividends on the issued and outstanding shares of any one or more classes of common shares without declaring a ratably equal dividend or dividends, or any dividend at all, on the then issued and outstanding shares of any of the other classes of common shares PROVIDED ALWAYS that this right shall always be subject to the provisions of the Act and the rights specifically granted in these Articles to the holders of preferred shares.

3.1.4 Except to the extent otherwise specified, each common share of the Corporation shall rank equally with each of the other common shares of the Corporation regardless of class including, without limitation, the right to receive the remaining property of the Corporation on the dissolution or winding-up of the Corporation or other distribution of the assets of the Corporation amongst its shareholders for the purpose of winding-up its affairs.

3.2 CLASS C PREFERRED SHARES

3.2.1 Subject to the Act, the directors shall determine, prior to the issuance of any shares of a series in the Class "C Preferred shares:

3.2.1.1 whether or not the holders of that series of shares shall be entitled to receive a dividend, out of the monies of the Corporation properly applicable to the payment of dividends; and if so, whether the same will be fixed or discretionary, non-cumulative or cumulative, or payable annually or on the basis of some other period of time, and the directors shall specify the basis upon which the dividends may be calculated, which may specify, without limitation, that the dividend shall be payable annually, semi-annually or quarterly, and that the dividend shall be determined on the basis of a percentage on the Redemption Amount (as

hereinafter defined). If the directors determine the holders of such shares will be entitled to receive a non- cumulative dividend, and if, within four months after the expiration of any fiscal year end of the Corporation, the directors in their discretion shall not have declared the stated non-cumulative dividend or any part of that dividend, then the rights of the holders of that series of shares, to the dividend or to any undeclared part thereof for that fiscal year shall be forever extinguished

3.2.1.2 whether or not the shares of that series of shares are to be redeemable or retractable, and if so, the Redemption Amount, payable in lawful money of Canada, at which that series of shares shall be redeemed or purchased (the "Redemption Amount");

3.2.1.3 Whether or not the shares of that series of shares shall possess any rights to convert the same into shares of another class and if so the conversion rights and the rate at which such conversion shall take place;

3.2.1.4 whether or not the shares of that series of shares are to be voting or non-voting and if voting, the number of votes per share and if applicable, any limitations on such voting rights;

3.2.1.5 any other rights, privileges, restrictions and conditions attaching to a series which are permitted to specified by the directors under the Act.

3.2.2 Notwithstanding the above, no rights, privileges, restrictions or conditions attached to a series of shares authorized to be issued hereunder shall confer on shares of a series:

3.2.2.1 greater voting rights than are attached to shares of any other series of Class "C" Preferred shares then outstanding;

3.2.2.2 a priority in respect of dividends or return of capital over shares of any other series of Class "C" Preferred shares then outstanding; provided however the limitation above does not apply to a right or privilege exchange a share or shares for, or to convert a share or shares into, a share or shares of another Class.

3.2.3 If the shares of any series are to be redeemable at the option of the Corporation, the Corporation may, upon giving notice as provided in section 3.2.5, redeem all or any one or more of the redeemable shares held by any one or more shareholders on payment for each share to be redeemed of the Redemption Amount, together with the amount of all declared and unpaid

dividends thereon (the amount so established being called in this section 3.2 the "Redemption Price").

3.2.4 If the shares are to be retractable at the option of the holder, the holder may require the Corporation to retract the Preferred shares upon the written demand (the "demand") of the holder, which demand shall contain the information required by section 3.2.5, following which the Corporation shall, within ten (l0) days following receipt of such demand, retract, in the manner provided for in section 3.2.5, all of the outstanding Preferred shares included in the demand, for a sum equal to the aggregate Redemption Price.

3.2.5 In the event that shares are being redeemed at the instance of the Corporation:

3.2.5.1 then the Corporation shall, at least thirty (30) days before the date specified for redemption or such lesser period of time as may be unanimously agreed upon by the holders of all the shares that are then being redeemed, mail to each person who at the date of mailing is a registered holder of the shares to be redeemed a notice in writing of the election of the Corporation to redeem such shares. Such notice shall be mailed by single registered letter, postage prepaid, addressed to each shareholder at that shareholder's address as it appears on the books of the Corporation or, in the event of the address of any shareholder not so appearing, then the last known address of the shareholder PROVIDED HOWEVER that an accidental failure or omission to give notice to one or more of the holders shall not affect the validity of the redemption as to the other holders. A notice sent by the corporation under Section 3.2.5.1, or a demand by a shareholder under
Section 3.2.4, shall set out the Redemption Price, the date on which the redemption or retraction is to take place and, if only some of the shares held by the shareholder in question are to be redeemed or retracted, the number thereof to be redeemed or retracted.

3.2.5.3 on or after the date specified for redemption or retraction, the Corporation shall pay or cause to be paid to or to the order of the registered holders of the shares to be redeemed or retracted the Redemption Price on presentation and surrender at the head office of the Corporation of the certificates for the shares to be redeemed or retracted. If only part of the shares represented by any certificate are to be redeemed or retracted, a new certificate for the balance shall be forthwith issued at the expense of the Corporation.

3.2.5.4 From and after the date specified in any notice or demand, the shares called for redemption or retraction shall cease to be

entitled to dividends not declared by that date and the holders shall not be entitled to exercise any of their rights as shareholders in respect of those shares. However, if the Redemption Price shall not be paid upon the presentation of certificates in accordance with the foregoing provisions, the rights of the holders of the shares not then paid for shall remain unaffected, except that the dividends that the holders are entitled to receive on those shares shall thereupon become cumulative and, for the purpose of calculating the Redemption Price of those shares, those accrued dividends shall be considered to have been declared.

3.2.5.5 In the event that all of the certificates for the shares to be redeemed or retracted are not presented and surrendered as required, the Corporation shall have the right at any time after the date specified for redemption or retraction in any notice or demand to deposit to a special account in any chartered bank or trust company in Canada named in the notice or demand, the Redemption Price of the number of shares represented by certificates which have not at the date of the deposit been surrendered by the holders in connection with the redemption or retraction. The deposit shall be made in such a manner that it will be paid without interest to or to the order of the respective holders of the shares called for redemption or retraction upon presentation and surrender to the bank or trust company of the share certificate or certificates representing the same. Upon the deposit being made, or upon the date specified for the redemption or retraction in the notice or demand, whichever is the latter, the shares in respect whereof the deposit shall have been made shall be, and shall be deemed to be, redeemed or retracted. The rights of the holder of the shares after the deposit or the redemption or retraction date, as the case may be, shall be limited to receiving without interest their proportionate share of the total Redemption Price so deposited against presentation and surrender of the certificates representing the shares held by them respectively, and any interest allowed on any deposit shall belong to the Corporation.

3.2.5.6 In the event that the shares are being redeemed or retracted pursuant to a requirement that they be so retracted or redeemed at a specified time or on the happening of a certain event, the provisions of this section 3.2.6 shall apply as if the shares were being redeemed at the instance of the Corporation unless the holder has accepted an obligation to notify the Corporation, or on an objective basis the event in question would be more within the knowledge or control of the holder, in which case, for the purpose of this section 3.2, the Corporation shall be considered to be

required to retract the shares on the earlier of the notice by the Corporation or the demand of the holder.

3.2.6 Subject to the Act, if only part of the outstanding redeemable Class "C" Preferred shares are to be redeemed at the election of the Corporation at any one time, the directors may in their absolute discretion determine the shares so to be redeemed and the redemption need not be pro-rata to the holding of any shareholder or on any other fixed basis.

3.2.7 The Redemption Amount for a series of Class "C" Preferred shares may be changed by the directors after issuance, as follows:

3.2.7.1 In the event that the shares were issued as partial or total consideration for the purchase by the Corporation of any assets including goodwill (hereafter called "the Purchased Assets") and it is determined at any time to the satisfaction of the directors in consultation with the auditors or accounting advisors of the Corporation, as the case may be, and representatives of Revenue Canada that the fair market value of the Purchased Assets at the date of purchase by the Corporation is a greater or a lesser amount than the Redemption Amount of the redeemable shares plus, if applicable, the fair market value of any non-share consideration issued by the Corporation in consideration for the Purchased Assets, then the Redemption Amount shall be increased or decreased, as required, to eliminate such difference. Any consequential overpayment by the Corporation to the holders of the shares (whether by way of earlier dividend, redemption, purchase or otherwise) shall be a debt due to the Corporation by the holder of the shares and shall be repaid to the Corporation forthwith. Any consequential underpayment by the Corporation to the holders of the shares (whether by way of earlier dividend, redemption, purchase or otherwise) shall be a debt due by the Corporation to the holders of the shares and shall be paid forthwith to the holders.

3.2.7.2 In all cases other than those covered by section 3.2.7.1 above, by resolution of the directors, subject always to obtaining any required consents and approvals.

3.2.8 In the event that the redemption or retraction of all those outstanding Class "C" Preferred shares in respect of which the Corporation has received or given notices or demands for redemption or retraction would, at any given time, cause the Corporation to be in contravention of the provisions of the Act, or any regulations or other legislation promulgated thereunder or

substituted therefore, the Corporation shall, at that time, redeem or retract, on a pro-rata basis, disregarding fractions, only such number of those shares as can be redeemed or retracted without causing a contravention. Thereafter the Corporation shall, at such time or times as the redemption or retraction can be made without causing the Corporation to contravene the aforesaid statutory requirements, redeem or retract the balance or a pro-rata portion of the outstanding shares in respect of which the Corporation has received or given redemption or retraction notices.

3.2.9 Notwithstanding anything to the contrary herein contained, and as a further restriction to that contained in the Act, no dividends or other payment or distribution shall be made to the holders of the common shares or any shares of any other class of the capital stock of the Corporation ranking junior to the Class "C" Preferred shares, if the payment or distribution thereof would result in the fair market value of the Corporation's assets, net of its liabilities, being less than the aggregate of the Redemption Price of all Class "C" Preferred shares then outstanding.

3.2.10 In the event of the liquidation, dissolution, or winding-up of the Corporation, or other distribution of the assets of the Corporation amongst its shareholders for the purpose of the winding-up of its affairs, the holder of each Class "C" Preferred share shall be entitled to receive the Redemption Price thereof in priority to any distribution whatsoever to the holders of common shares or the holders of any other class of the capital stock of the Corporation ranking junior to the Class "C" Preferred shares. After payment of the fore- going amounts to the holder of each such Class "C" Preferred share, that holder shall not, as a holder of Class "C" Preferred shares, be entitled to share in any further distribution of the property or assets of the Corporation.

SCHEDULE B RESTRICTIONS ON SHARE TRANSFERS

The right of shareholders to transfer or dispose of their shares shall be subject to the following restrictions: (i) a share or shares may be transferred by a shareholder or by any other person entitled to transfer the same if such transfer is first approved by the Corporation's Board of Directors.

SCHEDULE C OTHER PROVISIONS

1. PRIVATE CORPORATION

It is intended that the Corporation, to the extent permitted by law, not be required to comply with the Securities Act of Alberta or any legislation substituted therefore. Accordingly, the restrictions required by that legislation or any substitution thereof in the nature of limiting the issuance of the Corporations securities, as is currently set forth in the definition of "private company" therein, are incorporated as restrictions on the Corporation. At the date these Articles are signed, such restrictions are, in addition to there being restrictions on the right to transfer the Corporation's shares as set forth or referred to in Schedule B to these Articles:

(a) The number of the Corporation's shareholders, exclusive of

(i) persons who are in the Corporation's employment or that of an affiliate, and

(ii) persons who, having being formerly in the Corporation's employment or that of an affiliate, were, while in that employment, shareholders of the Corporation and have continued to be shareholders of that Corporation after termination of that employment,

is limited to not more than 50 persons, 2 or more persons who are the joint registered owners of 1 or more shares being counted as 1 shareholder.

Any invitation to the public to subscribe for the securities of the Corporation is prohibited.

2. DIRECTORS

The precise number of directors of the Corporation within the minimum and maximum number of directors provided for in the Articles of the Corporation shall be determined from time to time by resolution of the Board of Directors.

The directors may, between annual general meetings, resolve to appoint l or more additional directors to the Board of Directors to serve until the next annual general meeting provided that the number of additional directors does not exceed l/3 of the number of directors who held office at the expiration of the last annual general meeting of the Corporation.

3. LIENS ON SHARES

The Corporation shall have a first and paramount lien or charge on all the shares registered in the name of a shareholder, whether solely or jointly with others, for all their debts, liabilities and engagements to the Corporation, whether solely or jointly with another person, whether a shareholder of the Corporation or not, whether incurred or entered into before or after notice to the Corporation of any equitable or other interest in any person other than a shareholder and whether the period for the payment, discharge or fulfilment of such debt, liability or engagement has actually arrived or not. Such lien shall extend to all dividends or bonuses from time to time declared in respect of such shares.

CORPORATE ACCESS NUMBER: 208302455

ALBERTA

BUSINESS CORPORATIONS ACT

CERTIFICATE

OF

INCORPORATION

830245 ALBERTA LTD.
WAS INCORPORATED IN ALBERTA ON 1999/05/10.

[SEAL OF THE REGISTRAR

OF CORPORATIONS]

Exhibit 3.2(a)

BY-LAWS

OF
SENSUS CAPITAL CORP.

A NEVADA CORPORATION

ARTICLE ONE

OFFICES

Section 1.1 Registered Office - The registered office of this corporation shall be in the County of ____________________________ , State of Nevada.

Section 1.2 Other Offices - The corporation may also have offices at such other places both within and without the State of Nevada as the Board of Directors may from time to time determine or the business of the corporation may require.

ARTICLE TWO

MEETINGS OF STOCKHOLDERS

Section 2.1 Place - All annual meetings of the stockholders shall be held at registered office of the corporation or at such other place within or without the State of Nevada as the directors shall determine. Special meetings of the stockholders may be held at such time and place within or without the State of Nevada as shall be stated in the notice of the meeting, or in a duly executed waiver of notice thereof.

Section 2.2 Annual Meetings - Annual meetings of the stockholders, commencing with the year ____________________, shall be held on the ______________ day of _____________________ each year if not legal holiday and, if a legal holiday, then on the next secular day following, or at such other time as may be set by the Board of Directors from time to time, at which the stockholders shall elect by vote a Board of Directors and transact such other business as may properly be brought before the meeting.

Section 2.3 Special Meetings - Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute or by the Articles of Incorporation, may be called by the President or the Secretary by resolution of the Board of Directors or at the request in writing of stockholders owning a majority in amount of the entire capital stock of the corporation issued and outstanding and entitled to vote. Such request shall state the purpose of the purposed meeting.

Section 2.4 Notices of Meetings - Notices of meetings shall be in writing and signed by the President or a Vice-President or the Secretary or an Assistant Secretary or by such other person or persons as the directors shall designate. Such notice shall state the purpose or purposes for which the meeting is called and the time and the place, which may be within or without this State, where it is to be held. A copy of such notice shall be either delivered personally to or shall be mailed, postage prepaid, to each stockholder of record entitled to vote at such meeting not less than ten nor more than sixty days before such meeting. If mailed, it shall be directed to a stockholder at his address as it appears upon the records of the corporation and upon such mailing of any such notice, the service thereof shall be complete and the time of the notice shall being to run from the date upon which such notice is deposited in the mail for transmission to such stockholder. Personal delivery of any such notice to any

officer of a corporation or association or to any member of a partnership shall constitute delivery of such notice to such notice of and prior to the holding of the meeting it shall not be necessary to deliver or mail notice of the meeting to the transferee.

Section 2.5. Purpose of Meetings - Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice.

Section 2.6. Quorum - The holders of a majority of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute or by the Articles of Incorporation. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned 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 notified.

Section 2.7. Voting - When a quorum is present or represented at any meeting, the vote of the holders of a majority of the stock having voting power present in person or represented by proxy shall be sufficient to elect directors or to decide any questions brought before such meeting, unless the question is one upon which by express provision of the statutes or of the Articles of Incorporation, a different vote is required in which case such express provision shall govern and control the decision of such question.

Section 2.8. Share Voting - Each stockholder of record of the corporation shall be entitled at each meeting of stockholders to one vote for each share of stock standing in his name on the books of the corporation. Upon the demand of any stockholder, the vote for directors and the vote upon any question before the meeting shall be by ballot.

Section 2.9. Proxy - At the meeting of the stockholders any stockholder may be presented and vote by a proxy or proxies appointed by an instrument in writing. In the event that any such instrument in writing shall designate two or more persons to act as proxies, a majority of such persons present at the meeting, or, if only one shall be present, then that one shall have and may exercise all of the powers conferred by such written instrument upon all of the persons so designated unless the instrument shall otherwise provide. No proxy or power of attorney to vote shall be used to vote at a meeting of the stockholders unless it shall have been filed with the secretary of the meeting when required by the inspectors of election. All questions regarding the qualification of voters, the validity of proxies and the acceptance or rejection of votes shall be decided by the inspectors of election who shall be appointed by the Board of Directors, or if not so appointed, then by the presiding officer of the meeting.

Section 2.10. Written Consent in Lieu of Meeting - Any action which may be taken by the vote of the stockholders at a meeting may be taken without a meeting if authorized by the written consent of stockholders holding at least a majority of the voting power, unless the provisions of the statutes or of the Articles of Incorporation require a greater proportion of voting power to authorize such action in which case such greater proportion of written consents shall be required.

ARTICLE THREE

DIRECTORS

Section 3.1. Powers - The business of the corporation shall be managed by its Board of Directors which may exercise all such powers of the corporation and do all such lawful acts and things as are not by statute or by the Articles of Incorporation or by these Bylaws directed or required to be exercised or done by the stockholders.

Section 3.2. Number of Directors - The number of directors which shall constitute the whole board shall be one (1). The number of directors may from time to time be increased or decreased to not less than one nor more than fifteen by action of the Board of Directors. The directors shall be elected at the annual meeting of the stockholders and except as provided in Section 2 of this Article, each director elected shall hold office until his successor is elected and qualified. Directors need not be stockholders.

Section 3.3. Vacancies - Vacancies in the Board of Directors including those caused by an increase in the number of directors, may be filled by a majority of the remaining directors, though less than a quorum, or by a sole remaining director, and each director so elected shall hold office until his successor is elected at an annual or a special meeting of the stockholders. The holders of a two-thirds of the outstanding shares of stock entitled to vote may at any time peremptorily terminate the term of office of all or any of the directors by vote at a meeting called for such purpose or by a written statement filed with the secretary or, in his absence, with any other officer. Such removal shall be effective immediately, even if successors are not elected simultaneously and vacancies on the Board of Directors resulting therefrom shall be filled only by the stockholders.

A vacancy or vacancies in the Board of Directors shall be deemed to exist in case of the death, resignation or removal of any directors, or if the authorized number of directors be increased, or if the stockholders fail at any annual or special meeting of stockholders at which any director or directors are elected to elect the full authorized number of directors to be voted for at that meeting.

The stockholders may elect a director or directors at any time to fill any vacancy or vacancies not filled by the directors. If the Board of Directors accepts the resignation of a director tendered to take effect at a future time, the Board or the stockholders shall have power to elect a successor to take office when the resignation is to become effective.

No reduction of the authorized number of directors shall have the effect of removing any director prior to the expiration of his term of office.

ARTICLE FOUR

MEETINGS OF THE BOARD OF DIRECTORS

Section 4.1. Place - Regular meetings of the Board of Directors shall be held at any place within or without the State which has been designated from time to time by resolution of the Board or by written consent of all members of the Board. In the absence of such designation regular meetings shall be held at the registered office of the corporation. Special meetings of the Board may be held either at a place so designated or at the registered office.

Section 4.2. First Meeting - The first meeting of each newly elected Board of Directors shall be immediately following the adjournment of the meeting of stockholders and at the place thereof. No notice of such meeting shall be necessary to the directors in order legally to constitute the meeting, provided a quorum be present. In the event such meeting is not so held, the meeting may be held at such time and place as shall be specified in a notice given as hereinafter provided for special meetings of the Board of Directors.

Section 4.3. Regular Meetings - Regular meetings of the Board of Directors may be held without call or notice at such time and at such place as shall from time to time be fixed and determined by the Board of Directors.

Section 4.4. Special Meetings - Special Meetings of the Board of Directors may be called by the Chairman or the President or by any Vice-President or by any two directors.

Written notice of the time and place of special meetings shall be delivered personally to each director, or sent to each director by mail or by other form of written communication, charges prepaid, addressed to him at his address as it is shown upon the records or is not readily ascertainable, at the place in which the meetings of the directors are regularly held. In case such notice is mailed or telegraphed, it shall be deposited in the United States mail or delivered to the telegraph company at least forty-eight (48) hours prior to the time of the holding of the meeting. In case such notice is delivered as above provided, it shall be so delivered at least twenty-four (24) hours prior to the time of holding of the meeting. Such mailing, telegraphing or delivery as above provided shall be due, legal and personal notice to such director.

Section 4.5. Notice - Notice of the time and place of holding an adjourned meeting need not be given to the absent directors if the time and place be fixed at the meeting adjourned.

Section 4.6. Waiver - The transactions of any meeting of the Board of Directors, however called and noticed or wherever held, shall be as valid as though had a meeting duly held after regular call and notice, if a quorum be present, and if, either before or after the meeting, each of the directors not present signs a written waiver of notice, or a consent to holding such meeting, or an approval of the minutes thereof. All such waivers, consents or approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

Section 4.7. Quorum - A majority of the authorized number of directors shall be necessary to constitute a quorum for the transaction of business, except to adjourn as hereinafter provided. Every act or decision done or made by a majority of the directors present at a meeting duly held at which a quorum is present shall be regarded as the act of the Board of Directors,

unless a greater number is required by law or by the Articles of Incorporation. Any action of a majority, although not at a regularly called meeting, and the record thereof, if assented to in writing by all of the other members of the Board shall be as valid and effective in all respects as if passed by the Board in regular meeting.

Section 4.8. Adjournment - A quorum of the directors may adjourn any directors meeting to meet again at a stated day and hour; provided, however, that in the absence of a quorum, a majority of the directors present at any directors meeting, either regular or special, may adjourn from time to time until the time fixed for the next regular meeting of the Board.

ARTICLE FIVE

COMMITTEES OF DIRECTORS

Section 5.1. Power to Designate - The Board of Directors may, by resolution adopted by a majority of whole Board, designate one or more committees of the Board of Directors, each committee to consist of one or more of the directors of the corporation which, to the extent provided in the resolution, shall have and may exercise the power of the Board of Directors in the management of the business and affairs of the corporation and may have power to authorize the seal of the corporation to be affixed to all papers which may require it. Such committees shall have such name or names as may be determined from time to time by the Board of Directors. The members of any such committee present at any meeting and not disqualified from voting may, whether or not they constitute a quorum, unanimously appoint another member of the Board of Directors to act at the meeting in the place of any absent or disqualified member. At meetings of such committees, a majority of the members or alternate members shall constitute a quorum for the transaction of business, and the act of a majority of the members or alternate members at any meeting at which there is a quorum shall be the act of the committee.

Section 5.2. Regular Minutes - The committees shall keep regular minutes of their proceedings and report the same to the Board of Directors.

Section 5.3. Written Consent - 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 a written consent thereto is signed by all members of the Board of Directors or of such committee, as the case may be, and such written consent is filed with the minutes of proceedings of the Board or committee.

ARTICLE SIX

COMPENSATION OF DIRECTORS

Section 6.1. Compensation - The directors may be paid their expenses of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as director. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like reimbursement and compensation for attending committee meetings.

ARTICLE SEVEN

NOTICES

Section 7.1. Notice - Notices to directors and stockholders shall be in writing and delivered personally or mailed to the directors or stockholders at their addresses appearing on the books of the corporation. Notice by mail shall be deemed to be given at the time when the same shall be mailed. Notice to directors may also be given by telegram.

Section 7.2. Consent - Whenever all parties entitled to vote at any meeting, whether of directors or stockholders, consent, either by a writing on the records of the meeting or filed with the secretary, or by presence at such meeting and oral consent entered on the minutes, or by taking part in the deliberations at such meeting without objection, the doings of such meetings shall be as valid as if had at a meeting regularly called and noticed, and at such meeting any business may be transacted which is not excepted from written consent or to the consideration of which no objection for want of notice is made at the time, and if any meeting be irregular for want of notice or of such consent, provided a quorum was present at such a meeting, the proceedings of said meeting may be ratified and approved and rendered likewise valid and the irregularity of defect therein waived by a writing signed by all parties having the right to vote at such meeting; and such consent or approval of stockholders may be by proxy or attorney, but all such proxies and powers of attorney must be in writing.

Section 7.3. Waiver of Notice - Whenever any notice whatever is required to be given under the provisions of the statutes, of the Articles of Incorporation or of these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent thereto.

ARTICLE EIGHT

OFFICERS

Section 8.1. Appointment of Officers - The officers of the corporation shall be chosen by the Board of Directors and shall be President, a Secretary and a Treasurer. Any person may hold two or more offices.

Section 8.2. Time of Appointment - The Board of Directors at its first meeting after each annual meeting of stockholders shall choose a Chairman of the Board who shall be a director, and shall choose a President, a Secretary and a Treasurer, none of whom need be directors.

Section 8.3. Additional Officers - The Board of Directors may appoint a Vice-Chairman of the Board, Vice-Presidents and one or more Assistant Secretaries and Assistant Treasurers and such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors.

Section 8.4. Salaries - The salaries and compensation of all officers of the corporation shall be fixed by the Board of Directors.

Section 8.5. Vacancies - The officers of the corporation shall hold office at the pleasure of the Board of Directors. Any officer elected or appointed by the Board of Directors. Any vacancy occurring in any office of the corporation by death, resignation, removal or otherwise shall be filled by the Board of Directors.

Section 8.6. Chairman of the Board - The Chairman of the Board shall preside at meetings of the stockholders and the Board of Directors, and shall see that all orders and resolutions of the Board of Directors are carried into effect.

Section 8.7. Vice-Chairman - The Vice-Chairman shall, in the absence or disability of the Chairman of the Board, perform the duties and exercise the powers of the Chairman of the Board and shall perform such other duties as the Board of Directors may from time to time prescribe.

Section 8.8. President - The President shall be the chief executive officer of the corporation and shall have active management of the business of the corporation. He shall execute on behalf of the corporation all instruments requiring such execution except to the extent the signing and execution thereof shall be expressly designated by the Board of Directors to some other officer or agent of the corporation.

Section 8.9. Vice-President - The Vice-President shall act under the direction of the President and in the absence or disability of the President shall perform the duties and exercise the powers of the President. They shall perform such other duties and have such other powers as the President or the Board of Directors may from time to time prescribe. The Board of Directors may designate one or more Executive Vice-Presidents or may otherwise specify the order of seniority of the Vice-Presidents. The duties and powers of the President shall descend to the Vice-Presidents in such specified order of seniority.

Section 8.10. Secretary - The Secretary shall act under the direction of the President. Subject to the direction of the President he shall attend all meetings of the Board of Directors and all meetings of the stockholders and record the proceedings. He shall perform like duties for the standing committees when required. He shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the Board of Directors, and shall perform such other duties as may be prescribed by the President or the Board of Directors.

Section 8.11. Assistant Secretaries - The Assistant Secretaries shall act under the direction of the President. In order of their seniority, unless otherwise determined by the President or the Board of Directors, they shall, in the absence or disability of the Secretary, perform such other duties and exercise the powers of the Secretary. They shall perform such other duties and have such other powers as the President or the Board of Directors may from time to time prescribe.

Section 8.12. Treasurer - the Treasurer shall act under the direction of the President. Subject to the direction of the President he 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 deposit all monies and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the Board of Directors. He shall disburse the funds of the corporation as may be ordered by the President or the Board of Directors, taking proper vouchers for such disbursements, and shall render to the President and the Board of Directors, at its regular meetings, or when the Board of directors so

requires, an account of all his transactions as Treasurer and of the financial condition of the corporation.

Section 8.13. Surety - If required by the Board of Directors, he shall give the corporation a bond in such sum surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of his office and for the restoration to the corporation, in case of his death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his possession or under his control belonging to the corporation.

Section 8.14. Assistant Treasurer - The Assistant Treasurer in the order of their seniority, unless otherwise determined by the President or the Board of Directors, shall, in the absence or disability of the Treasurer, perform the duties and exercise the powers of the Treasurer. They shall perform such other duties and have such other powers as the President or the Board of Directors may from time to time prescribe.

ARTICLE NINE

CERTIFICATES OF STOCK

Section 9.1. Share Certificates - Every stockholder shall be entitled to have a certificate signed by the President or a Vice-President and the Treasurer or an Assistant Treasurer, or the Secretary of the corporation, certifying the number of shares owned by him in the corporation. If the corporation shall be authorized to issue more than once class of stock or more than one series of any class, the designations, preferences and relative, participating, optional or other special rights of the various classes of stock or series thereof and the qualifications, limitations or restrictions of such rights, shall be set forth in full or summarized on the face or back of certificate which the corporation shall issue to represent such stock.

Section 9.2. Transfer Agents - If a certificate is signed (a) by a transfer agent other than the corporation or its employees or (b) by a registrar other than the corporation or its employees, the signatures of the officers of the corporation may be facsimiles. In case any officers who has signed or whose facsimile signature has been placed upon a certificate shall cease to be such officer before such certificate is issued, such certificate may be issued with the same effect as though the person had not ceased to be such officer. The seal of the corporation, or a facsimile thereof, may, but need not be, affixed to certificates of stock.

Section 9.3. Lost or Stolen Certificates - The Board of directors may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the corporation alleged to have been lost or destroyed upon the making of an affidavit or that fact by the person claiming the certificate of stock to be lost or destroyed. When authorizing such issue of a new certificate or certificates, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or give the corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost or destroyed.

Section 9.4. Share Transfers - Upon surrender to the corporation or the transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, it shall be the duly of the corporation, if it is satisfied that all provisions of the laws and regulations applicable to the corporation regarding transfer and ownership of shares have been complied with, to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books.

Section 9.5. Voting Shareholder - The Board of Directors may fix in advance a date not exceeding sixty (60) days nor less than ten (10) days preceding the date of any meeting of stockholders, or the date for the payment of any dividend, or date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect, or a date in connection with obtaining the consent of stockholders for any purpose, as a record date for determination of the stockholders entitled to receive payment of any such meeting, and any adjournment thereof, or entitled to receive payment of any such dividend, or to give such consent, and in such case, such stockholders, and only such stockholders as shall be stockholder of record on the date so fixed, shall be entitled to notice of and to vote at such meeting, or any adjournment thereof, or to receive payment of such dividend, or to receive such allotment of rights, or to exercise such rights, or to give such consent, as the case may be, notwithstanding any transfer of any stock on the books of the corporation after any such record date fixed as aforesaid.

Section 9.6. Shareholders Record - The corporation shall be entitled to recognize the person registered on its books as the owner of shares to be the exclusive owner for all purposes including voting and dividends, and the corporation shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as other wise provided by the laws of Nevada.

ARTICLE TEN

GENERAL PROVISIONS

Section 10.1. Dividends - Dividends upon the capital stock of the corporation, subject to the provisions of the Articles of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property or in shares of the capital stock, subject to the provisions of the Articles of Incorporation.

Section 10.2. Reserves - Before payment of any dividend, there may be set aside out of any funds of the corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends or for repairing or maintaining any property of the corporation or for such other purpose as the directors shall think conducive to the interest of corporation, and the directors may modify or abolish any such reserve in the manner in which it was created.

Section 10.3. Checks - All checks or demands for money and notes of the corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

Section 10.4. Fiscal Year - The fiscal year of the corporation shall be fixed by resolution of the Board of Directors.

Section 10.5. Corporate Seal - The corporation may or may not have a corporate seal, as may from time to time be determined by resolution of the Board of Directors. If a corporate seal is adopted, it shall have inscribed thereon the name of the Corporation and the words "Corporate Seals" and "Nevada". The seal may be used by causing it or a facsimile thereof to be impressed or affixed or in any manner reproduced.

ARTICLE ELEVEN

INDEMNIFICATION

Every person who was or is a party or is threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or a person of whom he is the legal representative is or was a director or officer of the corporation or is or was serving at the request of the corporation or for its benefit as a director or officer of another corporation, or as its representative in a partnership, joint venture, trust or other enterprise, shall be indemnified and held harmless to the fullest extent legally permissible under the General Corporation Law of the State of Nevada from time to time against all expenses, liability and loss (including attorneys' fees, judgments, fines and amounts paid or to be paid in settlement) reasonably incurred in defending a civil or criminal action, suit or proceeding must be paid by the corporation as they are incurred and in advance of the final disposition of the action, suit or proceeding upon receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that he is not entitled to be indemnified by the corporation. Such right of indemnification shall be a contract right which may be enforced in any manner desired by such person. Such right of indemnification shall not be exclusive of any other right which such directors, officers or representatives may have or hereafter acquire and, without limiting the generality of such statement, they shall be entitled to their respective rights of indemnification under any bylaw, agreement, vote of stockholders, provision of law or otherwise, as well as their rights under this Article.

The Board of Directors may cause the corporation to purchase and maintain insurance on behalf of any person who is or was a director or officer of the corporation, or is or was serving at the request of the corporation as a director or officer of another corporation, or as its representative in a partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred in any such capacity or arising out of such status, whether or not the corporation would have the power to indemnify such person.

The Board of Directors may from time to time adopt further Bylaws with respect to indemnification and may amend these and such Bylaws to provide at all times the fullest indemnification permitted by the General Corporation Law of the State of Nevada.

ARTICLE TWELVE

AMENDMENTS

Section 12.1. By Shareholder - The Bylaws may be amended by a majority vote of all the stock issued and outstanding and entitled to vote at any annual or special meeting of the stockholders, provided notice of intention to amend shall have been contained in the notice of the meeting.

Section 12.2. By Board of Directors - The Board of Directors by a majority vote of the whole Board at any meeting may amend these Bylaws, including Bylaws adopted by the stockholders, but the stockholders may from time to time specify particular provisions of the Bylaws which shall not be amended by the Board of Directors.

APPROVED AND ADOPTED this 25th day of May, 1999. 

/s/ John M. Hall
-------------------------------
Secretary, John M. Hall

CERTIFICATE OF SECRETARY

I hereby certify that I am the Secretary of Sensus Capital Corp., and that the foregoing Bylaws, consisting of 11 pages, constitute the code of Bylaws of Sensus Capital Corp., as duly adopted at a regular meeting of the Board of Directors of the corporation held May 25, 1999.

IN WITNESS WHEREOF, I have hereunto subscribed my name this 25th day of May, 1999. 

/s/ John M. Hall
-----------------------------------
Secretary, John M. Hall

1

Exhibit 3.2(b)

BY-LAW NO. 1

A BY-LAW RELATING GENERALLY TO THE TRANSACTION OF THE
BUSINESS AND AFFAIRS OF
830245 ALBERTA LTD.

TABLE OF CONTENTS 

                           SUBJECT                                                   PAGE
                           -------                                                   ----

ARTICLE I      -   INTERPRETATION ......................................................1
                           1.01 - Definitions ..........................................1
ARTICLE II     -   EXECUTION OF INSTRUMENTS ............................................2
ARTICLE III    -   DIRECTORS ...........................................................2
                           3.01 - Election and Term  ...................................2
                           3.02 - Removal of Directors..................................2
                           3.03 - Vacation of Office ...................................2
                           3.04 - Vacancies ............................................3
                           3.05 - Substitute Directors..................................3
                           3.06 - Additional Directors..................................3
ARTICLE IV     -   DIRECTORS MEETINGS AND RESOLUTIONS...................................3
                           4.01 - Actions by Directors..................................3
                           4.02 - Place of Meeting .....................................3
                           4.03 - Calling of Meetings...................................4
                           4.04 - Notice of Meeting  ...................................4
                           4.05 - First Meeting of New Board............................4
                           4.06 - Adjourned Meeting ....................................4
                           4.07 - Regular Meetings .....................................4
                           4.08 - Chairman .............................................4
                           4.09 - Quorum ...............................................5
                           4.10 - Votes ................................................5
                           4.11 - Meetings by Telephone.................................5
ARTICLE V      -   COMMITTEES ..........................................................5

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                           5.01 - Executive Committee...................................5
                           5.02 - Other Committees of Directors.........................6
                           5.03 - Procedure ............................................6
ARTICLE VI    -  OFFICERS ..............................................................6
                           6.01 - Appointment ..........................................6
                           6.02 - Chairman of the Board.................................6
                           6.03 - Vice Chairman of the Board............................6
                           6.04 - Managing Director ....................................7
                           6.05 - President ............................................7
                           6.06 - Vice President .......................................7
                           6.07 - Secretary ............................................7
                           6.08 - Treasurer ............................................7
                           6.09 - Powers and Duties of Other Officers...................8
                           6.10 - Term of Office .......................................8
ARTICLE VII   -  PROTECTION OF DIRECTORS, OFFICERS AND OTHERS
                           7.01 - Conflict of Interest..................................8

                                            TABLE OF CONTENTS (Cont'd)
                                            -----------------


                           SUBJECT                                                     PAGE
                           -------                                                     ----

                           7.02 - Limitation of Liability ..............................8
                           7.03 - Indemnity ............................................9
                           7.04 - Insurance ............................................9
ARTICLE VIII  -  SHAREHOLDERS-MEETINGS..................................................10
                           8.01 - Annual Meetings.......................................10
                           8.02 - Special Meetings......................................10
                           8.03 - Place of Meetings.....................................10
                           8.04 - Notice of Meetings....................................10
                           8.05 - Chairman, Secretary and Scrutineers...................10
                           8.06 - Persons Entitled to be Present........................11

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                           8.07 - Quorum ...............................................11
                           8.08 - Proxies ..............................................11
                           8.09 - Voting ...............................................11
                           8.10 - Joint Shareholders....................................12
                           8.11 - Show of Hands.........................................12
                           8.12 - Ballots ..............................................12
                           8.13 - Adjournment...........................................12
                           8.14 - Resolution in Lieu of a Meeting.......................13
                           8.15 - Participation in Meeting by Telephone ................13
ARTICLE IX   -   SHARES ................................................................13
                           9.01 - Maintenance of Register...............................13
                           9.02 - Share Certificates....................................13
                           9.03 - Replacement of Share Certificates.....................13
                           9.04 - Non-Recognition of Trusts.............................14
                           9.05 - Joint Shareholders....................................14
                           9.06 - Deceased Shareholders.................................14
                           9.07 - Lien For Indebtedness.................................14
ARTICLE X    -   DIVIDENDS .............................................................14
                           10.01 - Dividend Cheques.....................................14
                           10.02 - Non-Receipt of Cheques...............................15
                           10.03 - Unclaimed Dividends..................................15
ARTICLE XI   -   NOTICES ...............................................................15
                           11.01 - Manner of Giving Notice..............................15
                           11.02 - Notice of Joint Shareholders.........................16
                           11.03 - Computation of Time..................................16
                           11.04 - Omissions and Errors.................................16
                           11.05 - Persons Entitled by Death or
                                   Operation of Law.....................................16
                           11.06 - Waiver of Notice.....................................16
ARTICLE XII  -   EFFECTIVE DATE ........................................................17
                           12.01 - Effective Date ......................................17

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ARTICLE I
INTERPRETATION

1.01 DEFINITIONS. In this By-law No. 1 and all other By-laws of the Corporation, unless otherwise specified, or unless the context otherwise requires:

(a) "Act" means the Business Corporations Act, Chapter B-l5, S.A. l98l, or any statute that may be substituted therefor, as from time to time amended;

(b) "appoint" includes "elect" and vice versa;

(c) "Articles" means the Articles of Incorporation or the Articles of Continuance of the Corporation, as the case may be, as from time to time amended or restated;

(d) "board"means the board of directors of the Corporation;

(e) "By-laws" means this By-law No. l and all other By-laws of the Corporation from time to time in effect;

(f) "Corporation" means 830245 ALBERTA LTD.;

(g) "meeting of shareholders" includes an annual meeting of shareholders and a special meeting of shareholders; "special meeting of shareholders" includes a meeting of any class or classes of shareholders and a special meeting of all shareholders entitled to vote at an annual meeting of shareholders;

(h) "recorded address" means, in the case of a shareholder, his address as recorded in the securities register; in the case of joint shareholders, the address appearing in the securities register in respect of such joint holding or the first address so appearing if there is more than one; and in the case of a director, officer, auditors or member of a committee of the board, his latest address as recorded in the records of the Corporation;

(i) "signing officer" means, in relation to any instrument, any person authorized to sign or certify the same on behalf of the Corporation by Section 2.01 of this

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By-law No. 1 or by a resolution passed pursuant thereto;

Save as aforesaid, words and expressions defined in the Act have the same meaning when used in the By-Laws; and words importing gender include the masculine, feminine and neuter genders; and words importing persons include individuals, bodies corporate, partnerships, trusts and unincorporated organizations.

ARTICLE II
EXECUTION OF INSTRUMENTS

2.01 EXECUTION OF INSTRUMENTS. Deeds, transfers, assignments, contracts, obligations, certificates and other documents requiring execution by the Corporation may be signed by the Corporation by the hands of such person or persons and in such manner as the Board may from time to time designate by resolution.

ARTICLE III
DIRECTORS

3.01 ELECTION AND TERM. The election of directors shall take place at each annual meeting of shareholders and all the directors then in office shall retire but, if qualified, shall be eligible for re-election. The shareholders shall elect directors to the Board in compliance with any residency requirements in the Act and the number of directors to be elected at any such meeting shall be the number of directors then in office or, subject to the Act, the number the directors or the shareholders otherwise determine. The election shall be by ordinary resolution. A director need not be a shareholder of the Corporation.

3.02 REMOVAL OF DIRECTORS. Subject to the Act, the shareholders may by ordinary resolution passed at a meeting specially called for such purpose remove any director from office and the vacancy created by the removal may be filled at the same meeting, failing which it may be filled by the Board.

3.03 VACATION OF OFFICE. A director ceases to hold office when:

(a) he dies;
(b) he is removed from office by the shareholders;
(c) he ceases to be qualified for election as a director; or

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(d) his written resignation is sent or delivered to the Corporation, or, if a time is specified in such resignation, at the time so specified, whichever is later.

3.04 VACANCIES. Subject to the Act, a quorum of the Board may fill a vacancy in the Board.

3.05 SUBSTITUTE DIRECTORS. A director being absent either temporarily or permanently from the Province of Alberta may, if consented to by a majority of the other directors, appoint and authorize in writing, for a period not exceeding one (1) year from the date of such appointment, any person to attend and vote as fully and effectively as if such director were personally present at any meeting of the directors of the Corporation, and to accept any notice of such meeting. A person so appointed shall be known as and referred to as a "substitute director". For the purpose of computing a quorum of the Board for any meeting, a substitute director attending thereat shall be deemed to be a director. The appointment of a substitute director shall be executed by the director making the appointment. Such appointment may be revoked at any time upon written notice to the Corporation.

3.06 ADDITIONAL DIRECTORS. If the Articles so provide, the Board may, between annual meetings, appoint one or more additional directors of the Corporation to serve until the next annual meeting, but the number of additional directors shall not at any time exceed l/3 of the number of directors who held office at the expiration of the last annual meeting of the Corporation.

ARTICLE IV
DIRECTORS MEETINGS AND RESOLUTIONS

4.01 ACTIONS BY DIRECTORS. The Board shall manage the business and affairs of the Corporation. Subject to the restrictions contained in the Act, the powers of the Board and, if applicable, a committee of the Board, may be exercised by resolution passed at a meeting at which a quorum is present or by resolution in writing signed by all the directors entitled to vote on that resolution at a meeting of the Board or, if applicable, a committee of the Board.

4.02 PLACE OF MEETING. Meetings of the Board may be held within or outside Alberta.

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4.03 CALLING OF MEETINGS. Meetings of the Board shall be held at such time and place as the Chairman of the Board, the Vice-Chairman of the Board, the Managing Director, the President or any two (2) directors may determine.

4.04 NOTICE OF MEETING. Notice of the time and place of each meeting of the Board shall be given in the manner provided in Section 11.01 to each director not less than forty-eight (48) hours before the time when the meeting is to be held. A notice of a meeting of the Board shall specify such matters to be dealt with at the meeting as are required by the Act to be specified therein but need not otherwise specify the purpose of or the business to be transacted at the meeting. A director may in any manner and at any time waive notice of or otherwise consent to a meeting of the Board.

4.05 FIRST MEETING OF NEW BOARD. Provided a quorum is present, a newly elected Board may, without notice, hold their first meeting immediately following the meeting of shareholders at which that Board is elected.

4.06 ADJOURNED MEETING. Notice of an adjourned meeting of the Board is not required if a quorum was present at the original meeting and the time and place of the adjourned meeting is announced at the original meeting. Where a meeting is adjourned because a quorum is not present, a quorum will be deemed to be present at the adjourned meeting if notice of the time and place of the adjourned meeting, as well as notice that it is a meeting adjourned due to the lack of a quorum at the original meeting, is given to those entitled to notice of the originally scheduled meeting.

4.07 REGULAR MEETINGS. The Board may appoint a day or days in any month or months for regular meetings of the Board at a place and hour to be named. A copy of any resolution of the Board fixing the place and time of such regular meetings shall be sent to each director forthwith after being passed, and forthwith to each director subsequently elected or appointed, but no other notice shall be required for any such regular meeting except where the Act or the By-laws require that the purpose thereof or the business to be transacted thereat be specified.

4.08 CHAIRMAN. The chairman of any meeting of the Board shall be the first mentioned of such of the following officers as have been appointed and who is a director and is present at the meeting: Chairman of the Board, Vice Chairman of the Board, Managing Director or President. If no such officer is present, the directors present shall choose one of their number to be chairman.

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4.09 QUORUM. Subject always to any provisions to the contrary in the Articles or the Bylaws and to the requirements of the Act; the quorum for the transaction of business at any meeting of the Board shall consist of the greater of the minimum number of directors specified in the Articles or a majority of the directors; Provided that the Board may from time to time increase such quorum for a limited time or purpose. Notwithstanding any vacancy among the directors, a quorum of the Board may exercise all the powers of the Board.

4.10 VOTES. At all meetings of the Board every question shall be decided by a majority of the votes cast on the question. The chairman of the meeting, who shall have an original vote, shall not have a second or casting vote.

4.11 MEETINGS BY TELEPHONE. A director may participate in a meeting of the Board or, if applicable, a committee of the Board, by means of such telephone or other communication facilities as permit all persons participating in the meeting to hear each other.

ARTICLE V
COMMITTEES

5.01 EXECUTIVE COMMITTEE. Subject to any residency requirements contained in the Act, the Board may appoint an executive committee consisting of three (3) directors, or such larger number of directors as the Board may from time to time determine, to hold office until their successors are appointed. During the intervals between meetings of the Board, the executive committee shall possess and may exercise (subject to any restrictions contained in the Act or imposed from time to time by the Board) all of the powers of the Board to manage the business and affairs of the Corporation in such manner as the executive committee shall deem to be in the best interests of the Corporation. All proceedings of the executive committee shall be open to examination by the Board, or any of the directors, and shall be reported to the Board if and when the Board so directs. The Board may from time to time remove any member from the executive committee and may also from time to time fill any vacancy which may occur in the membership thereof.

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5.02 OTHER COMMITTEES OF DIRECTORS. The Board may appoint one or more other committees of directors, however designated, and delegate to such committees any of the powers of the Board except those which, under the Act, a committee of directors has no authority to exercise.

5.03 PROCEDURE. Unless otherwise determined in the By-laws or by the Board, each committee shall have the power to fix its quorum at not less than a majority of its members, and also to elect its chairman and to regulate its procedure.

ARTICLE VI
OFFICERS

6.01 APPOINTMENT. The Board may from time to time appoint a Chairman of the Board, a Vice Chairman of the Board, a Managing Director, a President, one (1) or more Vice Presidents (to which title may be added words indicating seniority or function), a Secretary, a Treasurer and such other officers as the Board may determine, including one (1) or more assistants to any of the officers so appointed. The Board may specify the duties of and, in accordance with this By-law No. 1 and subject to the provisions of the Act, delegate to such officers powers to manage the business and affairs of the Corporation. Unless otherwise specifically provided for herein, an officer may but need not be a director and two (2) or more offices may be held by the same person.

6.02 CHAIRMAN OF THE BOARD. The Chairman of the Board shall be a director, and shall, when present, preside at all meetings of the Board, and of the shareholders. In addition the Board may assign to him any of the powers and duties that are by the By-laws assigned to the Managing Director or to the President; and he shall have such other powers and duties as the Board may specify.

6.03 VICE CHAIRMAN OF THE BOARD. The Vice Chairman of the Board shall be a director and, during the absence or disability of the Chairman of the Board, the Vice Chairman of the Board shall perform the duties and exercise the powers of the Chairman of the Board; and he shall have such other powers and duties as the Board may specify.

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6.04 MANAGING DIRECTOR. The Managing Director shall be a resident Canadian and a director. If appointed, he shall be the chief executive officer of the Corporation and shall (subject to the authority of the Board or any restrictions contained in the Act) have full power to manage and direct the business and affairs of the Corporation; and he shall have such other powers and duties as the Board may specify. During the absence or disability of the President, or if no President has been appointed, the Managing Director shall also have the powers and duties of that office.

6.05 PRESIDENT. The President shall (subject to the authority of the Board and the Managing Director, if any) have full power to manage and direct the business and affairs of the Corporation; and he shall have such other powers and duties as the Board may prescribe or the Managing Director, within his powers, may delegate. During the absence or disability of the Managing Director, or if no Managing Director has been appointed, the President shall also have the powers and duties of that office.

6.06 VICE PRESIDENT. During the absence or disability of the President, if a Managing Director has not been appointed or is absent or disabled, the President's duties shall be performed and his powers exercised by the Vice President or, if there are more than one, by the Vice President designated from time to time by the Board. A Vice President shall have such other powers and duties as the Board may prescribe or the President, within his powers, may delegate.

6.07 SECRETARY. The Secretary, as and when requested to do so, shall attend and be the secretary of all meetings of the Board, shareholders and committees of the Board, and shall enter or cause to be entered in records kept for that purpose minutes of all proceedings thereat. He shall give or cause to be given, as and when instructed, all notices to shareholders, directors, officers, auditors and members of committees of the Board. He shall be the official custodian of the stamp or mechanical device generally used for affixing the corporate seal of the Corporation, if any, and of all books, papers, records, documents and instruments belonging to the Corporation, except when some other officer or agent has been appointed for that purpose. The Secretary shall also have such other powers and duties as the Board may prescribe or the Managing Director, within his powers, may delegate.

6.08 TREASURER. The Treasurer shall keep proper accounting records in compliance with the Act and shall be responsible for the deposit of monies, the safekeeping of securities and the disbursements of the funds of the Corporation. He shall render to the Board whenever required an account of all his transactions as Treasurer. The Treasurer shall also have such other powers and duties as the Board may prescribe or the Managing Director, within his powers, may delegate.

8

6.09 POWERS AND DUTIES OF OTHER OFFICERS. The powers and duties of all other officers shall be such as the terms of their engagement call for or as the Board may prescribe or the Managing Director, within his powers, may delegate. Any of the powers and duties of an officer to whom an assistant has been appointed may be exercised and performed by such an assistant, unless the Board or the Managing Director otherwise directs.

6.10 TERM OF OFFICE. The Board, in its discretion, may remove any officer of the Corporation. Otherwise each officer appointed by the Board shall hold office until his successor is appointed, or until his earlier resignation.

ARTICLE VII
PROTECTION OF DIRECTORS, OFFICERS AND OTHERS

7.01 CONFLICT OF INTEREST. A director or officer shall not be required to vacate his office by reason only that he is a party to, or is a director or officer or has a material interest in any person who is a party to a material contract or proposed material contract with the Corporation or a subsidiary thereof. Such a director or officer shall, however, disclose the nature and extent of his interest in the contract at the time and in the manner provided by the Act. Subject to the provisions of the Act, a director shall not by reason only of his office be accountable to the Corporation or to its shareholders for any profit or gain realized from such a contract or transaction, and such contract or transaction shall not be void or voidable by reason only of the director's interest therein, provided that the required declaration and disclosure of interest is properly made, the contract or transaction is approved by the Board or the shareholders, and it is fair and reasonable to the Corporation at the time it was approved and, if required by the Act, the director refrains from voting as a director on the contract or transaction and absents himself from the director's meeting at which the contract is authorized or approved by the directors, except attendance for the purpose of being counted in the quorum.

7.02 LIMITATION OF LIABILITY. No director or officer shall be liable for the acts, receipts, neglects or defaults of any other director, officer or employee, or for joining in any receipt or other act for conformity, or for any loss, damage or expense happening to the Corporation through the insufficiency or deficiency of title to any property acquired for or on behalf of the Corporation, or for the insufficiency or deficiency of any security in or upon which any of the monies of the corporation shall be invested, or for any loss or damage arising from the bankruptcy, insolvency or tortious acts of any person with whom any of the monies, securities or effects of the Corporation shall be deposited, or for any loss occasioned by any error of judgment or oversight on his part or for any other loss, damage or misfortune whatever which shall happen in the execution

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of the duties of his office or in relation thereto, unless the same are occasioned by his own wilful neglect or default; provided that nothing herein shall relieve any director or officer from the duty to act in accordance with the Act and the regulations thereunder or from liability for any breach thereof.

7.03 INDEMNITY. Subject to the Act, the Corporation shall indemnify a director or officer, a former director or officer, or a person who acts or acted at the Corporation's request as a director or officer of a body corporate of which the Corporation is or was a shareholder or creditor, and his heirs, executors, administrators and other legal representatives, from and against:

(a) any liability and all costs, charges and expenses that he sustains or incurs in respect of any action, suits or proceeding that is proposed or commenced against him for or in respect of anything done or permitted by him in respect of the execution of the duties of his office, and,
(b) all other costs, charges and expenses that he sustains or incurs in respect of the affairs of the Corporation,

except where such liability related to his failure to act honestly and in good faith with a view to the best interests of the Corporation; and, in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful.

7.04 INSURANCE. Subject to the Act, the Corporation may purchase and maintain insurance for the benefit of any person referred to in the preceding section against any liability incurred by him in his capacity as a director or officer of the Corporation or of any body corporate where he acts or acted in that capacity at the Corporation's request.

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ARTICLE VIII
SHAREHOLDERS-MEETINGS

8.01 ANNUAL MEETINGS. The annual meeting of shareholders shall be held at such time in each year as the Board may from time to time determine for the purpose of considering the financial statements and reports required by the Act to be placed before the annual meeting, electing directors and appointing auditors (if required by the Act or the Articles) and for the transaction of such other business as may properly be brought before the meeting.

8.02 SPECIAL MEETINGS. The Board may call a special meeting of shareholders at any time.

8.03 PLACE OF MEETINGS. Meetings of shareholders shall be held at the registered office or any place within Alberta if the Board by resolution determines such place or, if all the shareholders entitled to vote at the meeting so agree, outside Alberta.

8.04 NOTICE OF MEETINGS. Notice of the time and place of each meeting of shareholders shall be given, in the manner provided in Section 11.01 not less than twenty-one (21) or more than fifty (50) days before the date on which the meeting is to be held, to each director, to the auditors if any and if required, and to each shareholder entitled to receive notice of the meeting. Notice of a meeting of shareholders called for any purpose other than consideration of the financial statements and auditors' reports, if any, election of directors and re-appointment of the incumbent auditors at an Annual Meeting shall state the nature of such business in sufficient detail to permit the shareholder to form a reasoned judgment thereon and shall state the text of any special resolution to be submitted to the meeting.

8.05 CHAIRMAN, SECRETARY AND SCRUTINEERS. The chairman of any meeting of shareholders shall be the first mentioned of such of the following persons who are present at the meeting: Chairman of the Board, Vice Chairman of the Board, Managing Director, President or a Vice President who is a shareholder. If no such person is present within fifteen (15) minutes from the time fixed for holding the meeting, the persons present and entitled to vote shall choose one
(1) of their number to be chairman of the meeting. If the Secretary of the Corporation is absent, the chairman of the meeting shall appoint some person, who need not be a shareholder, to act as secretary of the meeting. One (1) or more scrutineers, who need not be shareholders, may be appointed by ordinary resolution of the shareholders or by the chairman of the meeting with the consent of the meeting.

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8.06 PERSONS ENTITLED TO BE PRESENT. The only persons entitled to be present at a meeting of shareholders shall be those entitled to vote thereat, the directors and auditors (if any) of the Corporation and others who, although not entitled to vote, are entitled or required under the provisions of the Act, the Articles or the By-laws to be present at the meeting. Any other person may be admitted only on the invitation of the chairman of the meeting or with the consent of the meeting.

8.07 QUORUM. A quorum for the transaction of business at any meeting of the shareholders shall be:

(a) where the Corporation has only one (1) shareholder, or one (1) shareholder holds a majority of the shares entitled to vote at the meeting, that shareholder, in person or represented by proxy;
(b) in all other cases two (2) shareholders personally present and owning or representing by proxy at least twenty-five (25%) per cent of the shares entitled to vote at the meeting;

If a quorum is not present at the opening of a meeting of shareholders, the shareholders present or represented by proxy may adjourn the meeting to a fixed time and place but may not transact any other business.

8.08 PROXIES. Every shareholder entitled to vote at a meeting of shareholders may by means of a proxy appoint a proxyholder, or one or more alternate proxyholders, who need not be a shareholder or shareholders to attend and act at the meeting in the manner and to the extent authorized and with the authority conferred by the proxy. A proxy shall be in writing executed by the shareholder or his attorney authorized in writing and shall conform with the requirements of the Act. A proxy is valid only at the meeting in respect of which it is given or at any adjournment thereof and may be revoked in accordance with the provisions of the Act.

8.09 VOTING. At any meeting of shareholders every question shall, unless otherwise required by the Act, Articles or Bylaws, be determined by the majority of the votes cast on the question. The chairman of the meeting, who shall have an original vote, shall not have a second or casting vote.

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8.10 JOINT SHAREHOLDERS. If two or more persons hold a share jointly, any one of them present in person or duly represented at a meeting of shareholders may, in the absence of the other or others, vote that share; but if two or more of those persons are present in person or represented and vote, they shall vote as one the share jointly held by them.

8.11 SHOW OF HANDS. Subject to the Act, any question at a meeting of shareholders shall be decided by a show of hands unless a ballot thereon is required or demanded as hereafter provided. Upon a show of hands every person who is present and entitled to vote shall have one (1) vote. Whenever a vote by show of hands shall have been taken upon a question, unless a ballot thereon is so required or demanded, a declaration by the chairman of the meeting that the vote upon the question has been carried or carried by a particular majority or not carried, if such declaration is evidenced by an entry to that effect in the minutes of the meeting, shall be prima facie evidence of the disposition of that question without proof of the number of votes recorded in favour of or against any resolution or other proceeding in respect of the said question.

8.12 BALLOTS. On any question proposed for consideration at a meeting of shareholders, and whether or not a show of hands has been taken thereon, any shareholder or proxyholder entitled to vote at the meeting may require or demand a ballot. If a ballot is demanded on the election of a chairman of the meeting or on the question of adjournment it shall be taken forthwith without an adjournment. A ballot required or demanded on any other question shall be taken in such manner as the chairman of the meeting shall direct. A requirement or demand for a ballot may be withdrawn at any time prior to the taking of the ballot. If a ballot is taken each person present shall be entitled, in respect of the shares which he is entitled to vote at the meeting upon the question, to that number of votes provided by the Act or the Articles.

8.13 ADJOURNMENT. If a quorum is present at the opening of a meeting of the shareholders and, if such meeting is adjourned for a specific period less than thirty (30) days, it shall not be necessary to give notice of the adjourned meeting other than by announcement at the earlier meeting that is adjourned, and a quorum shall be deemed to be present at the adjourned meeting. Where a meeting is adjourned because a quorum is not present a quorum shall be deemed to be present at the adjourned meeting if not less than seven (7) days notice of the time and place fixed for the adjourned meeting, as well as notice that it is a meeting adjourned due to the lack of a quorum at the originally scheduled meeting, is given to those entitled to notice of the originally scheduled meeting.

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8.14 RESOLUTION IN LIEU OF A MEETING. Notwithstanding anything contained in this By-law No. 1, a resolution in writing signed by all the shareholders entitled to vote on that resolution at a meeting of shareholders is as valid as if it had been passed at a meeting of the shareholders.

8.15 PARTICIPATION IN MEETINGS BY TELEPHONE. A shareholder or any other person entitled to attend a meeting of shareholders may participate in a meeting of the shareholders by means of such telephone or other communication facilities as permit all persons participating in the meeting to hear each other.

ARTICLE IX
SHARES

9.01 MAINTENANCE OF REGISTER. The Board may from time to time appoint an agent to maintain the central securities register and branch securities registers, if any. The Board may at any time terminate any such appointment.

9.02 SHARE CERTIFICATES. Share certificates and the form of stock transfer power on the reverse side thereof shall (subject to the Act) be in such form as the Board may by resolution approve and such certificates shall be signed manually by the Chairman of the Board, or the President, or the Vice President, or the Secretary, or by on behalf of a registrar, transfer agent or branch transfer agent of the Corporation, if any. The corporate seal of the Corporation, if any, need not be impressed upon a share certificate issued by the Corporation.

9.03 REPLACEMENT OF SHARE CERTIFICATES. The Board, or any officer or agent designated by the Board for that purpose, may in their discretion, direct the issue of a new share certificate in lieu of and upon cancellation of a share certificate that has been mutilated or in substitution for a share certificate claimed to have been lost, destroyed or wrongfully taken, on such terms as to indemnity, reimbursement of expenses and evidence of loss and of title as the Treasurer (or, in the absence of or failure to act by the Treasurer, the Board) may from time to time prescribe, whether generally or in any particular case.

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9.04 NON-RECOGNITION OF TRUSTS. Subject to the Act, the Corporation may treat the registered holder of any share as the person exclusively entitled to vote, to receive notices, to receive any dividend or other payments in respect of the share, and otherwise to exercise all the rights and powers of an owner of the share.

9.05 JOINT SHAREHOLDERS. If two or more persons are registered as joint holders of any share, the Corporation shall not be bound to issue more than one certificate in respect thereof, and delivery of such certificate to one of such persons shall be sufficient to all of them. Any one of such persons may give effectual receipts for the certificate issued in respect thereof or for any dividend, bonus, return of capital or other money payable or warrant issuable in respect of such share.

9.06 DECEASED SHAREHOLDERS. In the event of the death of a holder, or of one (1) or more of the joint holders, of any share, the Corporation shall not be required to make any entry in the securities register in respect thereof or to make payment of any dividends thereon except upon production of all such documents as may be required by the Act or otherwise by law and/or upon compliance with the reasonable requirements of the Corporation and its transfer agents.

9.07 LIEN FOR INDEBTEDNESS. If the Articles provide that the Corporation shall have a lien on shares registered in the name of a shareholder indebted to the Corporation, such lien may be enforced, subject to the Articles, by the sale of the shares thereby affected or by any other action, suit, remedy or proceeding authorized or permitted by law or by equity and, pending such enforcement, the Corporation may refuse to register a transfer of the whole or any part of the shares and withhold the payment of dividends on the shares.

ARTICLE X
DIVIDENDS

10.01 DIVIDEND CHEQUES. A dividend payable in cash shall be paid by cheque to the order of each registered holder of shares of the class or series of which it has been declared and mailed by pre-paid ordinary mail to such registered holder at his recorded address, unless such holder otherwise directs. In the case of joint holders the cheque shall, unless such joint holders otherwise direct, be made payable to the order of all such joint holders and mailed to them at their recorded address. The mailing of such cheque as aforesaid, unless the same is not paid on due presentation, shall satisfy and discharge the liability for the dividend to the extent of the sum represented thereby plus the amount of any tax which the Corporation is required to and does withhold.

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10.02 NON-RECEIPT OF CHEQUES. In the event of non-receipt of any dividend cheque by the person to whom it is sent as aforesaid, the Corporation shall issue to such person a replacement cheque for a like amount on such terms as to indemnity, reimbursement of expenses and evidence of non-receipt and of title as the Treasurer (or, in the absence of or failure to act by the Treasurer, the Board) may from time to time prescribe, whether generally or in any particular case.

10.03 UNCLAIMED DIVIDENDS. Any dividend unclaimed after a period of six (6) years from the date on which the same has been declared to be payable shall be forfeited and shall revert to the Corporation.

ARTICLE XI
NOTICES

11.01 MANNER OF GIVING NOTICE. Any notice (which term includes any communication or document) to be given (which term includes sent, delivered or served) pursuant to the Act, the regulations thereunder, the Articles, the By-laws or otherwise to a shareholder, director, officer, auditor or member of a committee of the Board shall be sufficiently given if delivered personally to the person to whom it is to be given or if delivered to his recorded address or if mailed to him at his recorded address by prepaid mail or if sent to him at his recorded address by means of telex, telecopier, telegram or any means of transmitted or recorded communication. A notice so delivered shall be deemed to have been given when it is delivered personally or to the recorded address as aforesaid. A notice so mailed shall be deemed to have been received as provided in the Act, and a notice so sent by any means of transmitted or recorded communication shall be deemed to have been given when actually transmitted by the person giving such notice or, if dispatched or delivered, to the communication company or agency or its representative for dispatch. The Secretary shall change or cause to be changed the recorded address of any shareholder, director, officer, auditor or member of a committee Board in accordance with any information believed by him to be reliable.

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11.02 NOTICE OF JOINT SHAREHOLDERS. If two (2) or more persons are registered as joint holders of any share, any notice shall be addressed to all such joint holders but notice to one (1) of such persons shall be sufficient notice to all of them.

11.03 COMPUTATION OF TIME. In computing the date when notice must be given under any provision requiring a specified number of days notice of any meeting or other event, the date of giving the notice shall be excluded and the date of the meeting or other event shall be included.

11.04 OMISSIONS AND ERRORS. The accidental omission to give any notice to any shareholder, director, officer, auditor or member of a committee of the Board or the non-receipt of any notice by any such person or any error in any notice not affecting the substance thereof shall not invalidate any action taken at any meeting held pursuant to such notice or otherwise founded thereon.

11.05 PERSONS ENTITLED BY DEATH OR OPERATION OF LAW. Every person who, by operation of law, transfer, death of a shareholder or any other reason whatsoever, shall become entitled to any share, shall be bound by every notice in respect of the share which shall have been duly given to the shareholder from whom he derives his title to the share prior to his name and address being entered on the securities register (whether such notice was given before or after the happening of the event upon which he became so entitled) and prior to his furnishing to the Corporation the proof of authority or evidence of his entitlement prescribed by the Act.

11.06 WAIVER OF NOTICE. Any shareholder (or his duly appointed proxyholder), director, officer, auditor or member of a committee of the Board may at any time waive any notice, or waive or abridge the time for any notice, required to be given to him under any provision of the Act, the regulations thereunder, the Articles, the By-laws or otherwise and such waiver or abridgement shall cure any default in the giving or in the time of such notice, as the case may be. Any such waiver or abridgement shall be in writing except a waiver of notice of a meeting of shareholders or of the board or of a committee of the Board which may be given in any manner.

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ARTICLE XII
EFFECTIVE DATE

12.01 EFFECTIVE DATE. This By-law No. 1 shall become effective on the date that it is made by the Board of Directors, unless the resolution making this By-law No. 1 sets forth another effective date.

MADE by the First Director and Confirmed by the Board of Directors of the 10th day of May, 1999, and EFFECTIVE ON THAT DATE. 

/s/ Tim Bowes
-----------------------------

TIM BOWES

Exhibit 4

INCORPORATED UNDER THE LAWS OF THE STATE OF NEVADA

SENSUS CAPITAL CORP.

TOTAL AUTHORIZED ISSUE
25,000,000 SHARES PAR VALUE $.001 EACH

COMMON STOCK

SEE REVERSE FOR
CERTAIN DEFINITIONS

THIS IS TO CERTIFY THAT _____________________________ IS THE OWNER OF ____________ fully paid and non-assessable shares of the above Corporation transferable only on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this Certificate properly endorsed.

WITNESS, the seal of the Corporation and the signatures of its duly authorized officers.
DATED _____________

SEAL
SECRETARY PRESIDENT

1999 CORPEX BANKNOTE CO., BAY SHORE N.Y.

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws of regulations:

TEN COM - as tenants in common

TEN ENT - as tenants by the entireties

JT TEN - as joint tenants with right of survivorship and not as tenants in common

UNIF GIFT MIN ACT - __________ Custodian __________

(Cust) (Minor)

under Uniform Gifts to Minors ACT ______ __________ ______
(State)

Additional abbreviations may also be used though not in the above list

For value received ______________ hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE

(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING
POSTAL ZIP CODE OF ASSIGNEE)

________________________________________________________________________ Shares represented by the within Certificate, and do hereby irrevocably constitute and appoint

______________________________________________________________________ Attorney, to transfer the said Shares on the books of the within named Corporation with full power of substitution in the premises.

Dated __________________ _______ In presence of

NOTICE THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND HAVE BEEN TAKEN BY THE ISSUEE FOR INVESTMENT PURPOSES. SAID SHARES MAY NOT BE SOLD OR TRANSFERRED UNLESS (a) THEY HAVE BEEN REGISTERED UNDER SAID ACT (b) THE TRANSFER AGENT (OR THE COMPANY IF IT IS ACTING AS ITS OWN TRANSFER AGENT) IS PRESENTED WITH (i) A WRITTEN OPINION REASONABLY SATISFACTORY TO THE COMPANY, OR (ii) A "NO ACTION" OR INTERPRETIVE LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION TO THE EFFECT THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE CIRCUMSTANCES OF SUCH SALE OR TRANSFER OR

(iii) OTHER EVIDENCE SATISFACTORY TO THE COMPANY.

Exhibit 10.1

THIS AGREEMENT dated the 31st day of July, 1999,

BETWEEN:

SENSUS CAPITAL CORP.
("Sensus")

- and -

ALLTEAM ONLINE INC.
(the "Developer")

NOW THEREFORE in consideration of the respective covenants contained herein, Sensus and the Developer agree as follows:

1. MAKE-UP OF AGREEMENT

1.1 The complete agreement between the parties with respect to the acquisition of the idea and the development of the technology required to operate an internet web-site to be operated as the HIGHLIGHTREEL.COM web-site and all related domain names generally in accordance with the Business Plan attached as Schedule "A" (herein called the "AOI Network") and for the support of the web-site and any related services (herein called the "Agreement") shall be made up of the following documents described under paragraphs (1) through (3):

(1) This "Head Agreement" which contains all of the terms, conditions and provisions under which Sensus will acquire the technology and the rights to the web-site address including any computer software and related services from the Developer;

(2) The "Business Plan" which outlines the Custom Developed web-site which is to be developed on behalf of Sensus which attached as Schedule "A"; and

(3) The "Technology Support Services Schedule" which sets out the Technology Support Services to be provided by the Developer to Sensus which is attached hereto as Schedule "B".

1.2 In the event of any inconsistency between this Head Agreement and any of the Schedules, the Head Agreement shall prevail.

2. DEFINITIONS AND SCHEDULES

2.1 General -- Unless otherwise expressly defined herein, all data procession industry terms in this agreement shall have the meaning applied to them by the
[American National Dictionary for Information Processing Systems] (ANSI - X3.172 - 1990) and published by the American National Standards Institute, Inc., 1430 Broadway, New York, N.Y., 10018 Copyright 1991].

2.2 Specific -- As used in this agreement, and any schedule hereto, and any amendment hereof, and any documents to be executed and delivered pursuant to this agreement and in any documents executed and delivered in connection with the completion of the transaction contemplated herein, the following words and phrases shall have the following meanings, respectively:

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(a) "AOI Network" means the web-site to be developed by the Developer in accordance with the Business Plan attached as Schedule "A";

(b) "Business Day" means each of Monday, Tuesday, Wednesday, Thursday and Friday except where any such day occurs on any federal or provincial statutory holiday observed in the Province of Alberta;

(c) "Custom Developed Technology" means those new computer programs and associated Documentation provided in conjunction with the development of the AOI Network by the Developer described in the Business Plan attached as Schedule "A";

(d) "Documentation" means all written instructions, procedures and practices regarding the operation of the Technology which are required to enable Sensus to operate, maintain and manage the Technology upon Sensus' Hardware and which includes, but is not necessarily limited to, all of the manuals, handbooks, maintenance libraries, operating instructions, overviews and guides for the Technology;

(e) "Equipment" means the aggregate of electronic information processing equipment and related components, including but not limited to all processors, servers, workstations and tape drives, all as acquired by Sensus for the specific purpose of operating the Technology;

(f) "Sensus' Affiliates" means all corporations, companies, trusts, and other entities controlled directly or indirectly, by means of a trust, a corporation, or otherwise by Sensus;

(g) "Hardware" means the Equipment and the System Technology;

(h) "Implementation Period" means the period of time through which Sensus pays the Developer for the development of the AOI Network pursuant to the Implementation Plan;

(i) "Implementation Plan" has the meaning ascribed to it in Paragraph 4.2;

(j) "Installation Sites" means those sites as may be designated in this agreement and as designated from time to time by Sensus for both installation and operation of the Technology;

(k) "Enhancements" means the changes and additions to the Custom Developed Technology;

(l) "Functional Specifications" has the meaning ascribed to it in Paragraph 5;

(m) "Party" or "Parties" means either Sensus or the Developer if used in the singular and both the Developer and Sensus if used in the Plural;

(n) "Products and Services" means those Technology products, services and assistance described in paragraph 3.1 and 3.2 and the Schedules;

(o) "Source Code" means the counterpart human readable version of the Custom Developed Technology required to be provided hereunder in machine readable object code, and being capable, upon compilation, of being translated into machine executable object code when operated upon the computer system;

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(p) "Source Materials" means the Source Code and System Design Specifications, logic diagrams, and all other relevant documentation relating to the Technology;

(q) "System Design Specifications" means those technical specifications for the Technology developed or to be developed by the Developer for the purpose of enabling any persons reasonably skilled in software design, analysis or programming to maintain, and further develop, the Technology;

(r) "System Technology" means those operating systems, compilers, development software, utilities and related documentation hereafter specifically acquired by Sensus from third party Technology Developers for the specific purpose of operating the Technology upon the Equipment.

(s) "Technology" includes the computer programs comprised of Custom Developed Technology and the Hardware to operate the AOI Network as described in the Business Plan;

(t) "Technology Support Services" means the provision by the Developer of Technology maintenance services upon the terms set out in paragraph 8 of this Head Agreement and the Technology Support Services Schedule;

3. DELIVERABLES

3.1 Single complete transaction -- Subject to the terms and conditions of this Head Agreement, Sensus is hereby granted the following rights:

(a) All rights to the AOI Network and the Custom Developed Technology, including, without limitation:

(i) all intellectual property rights arising in respect of the operation of the web-site and the AOI Network;

(ii) any copyright in any software or any creative works developed by the Developer as part of developing the web-site and the AOI Network;

(b) the rights to the INTERNIC domain names described in the Business Plan;

(c) the right to further develop the web-site and the AOI Network, and in this respect, the Developer hereby waives any moral rights it may have in respect of any software or other copyright property developed for Sensus hereunder;

(d) to the extent the Developer provides any sublicense of System Technology, which is specifically authorised hereunder, it shall contemporaneously provide a letter addressed to Sensus, from the owner of that Technology, in which that owner irrevocably undertakes to directly license Sensus to use the Technology on substantially the same terms and conditions as those contained herein should any Head License from which or through which Sensus derives its rights to that Technology, be terminated;

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(e) the right to be provided project management assistance and services in accordance with paragraph 6;

(f) the right to be supplied training services in accordance with paragraph 11;

(g) the right to be supplied Technology Support Services as specified in Schedule "B".

3.2 Developer responsibility -- By entering into this agreement, the Developer agrees that it will, during the Implementation Period and in accordance with the terms and conditions of the agreement:

(a) assume overall contractual responsibility to Sensus for the development of the AOI Network and for the delivery and installation of all Technology components regardless of origin or manufacture;

(b) assume contractual responsibility to Sensus for all web-site and AOI Network development activities, which include, identifying and obtaining any required Technology and correcting all Technology failures, including failures relating to performance and functionality;

(c) secure the full time services of Graham Heal and such other employees of the Developer as are necessary to work on the development of the web-site and the AOI Network on behalf of the Developer in accordance with the Implementation Plan as provided below.

3.4 Customer's responsibilities -- Except as otherwise provided in this agreement, Sensus shall be responsible for performing the following activities:

(a) the furnishing of all supplies, including, without limitation, all Hardware;

(b) furnishing the Developer with all information mutually determined by the Developer and Sensus to be necessary for the performance of those services to be provided by the Developer as specified in this agreement.

3.5 Technology support -- Paragraph 8, together with the Technology Support Services Schedule, specify the nature and cost to Sensus of any ongoing Technology Support Services following expiration of the Implementation Period of Technology Support Services.

4. CHARGES AND PAYMENTS

4.1 In order for Sensus to secure the rights described in paragraph 3 Sensus shall be required, on or before November 1, 1999, to issued 25,000 Sensus Shares to the Developer. Thereafter, for Sensus to be able to maintain the rights so described, and to secure the services of the Developer:

(a) Sensus is required, on or before December 31, 2000, to commence funding the development of the AOI Network, by making monthly payments of $25,000 US to AOI, in exchange for which AOI will be required to arrange for the full time services of Graham Heal, who shall be obligated to use his best efforts to develop the web-site as efficiently as possible (provided however that if Sensus does not make the first payment of $25,000 US, on or before December 31, 2000, all rights to the web-site and any related technology will revert to AOI).

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(b) After the development is completed and an operating web-site has been completed, Sensus will be required to pay AOI a management fee equal to 10% of the gross revenues derived from the AOI Network, in exchange for which AOI will be required to provide the services of Graham Heal to manage the AOI Network, subject to Sensus directions;

provided however that if the parties do not agree on the Implementation Plan or if Sensus does not provide the first advance of $25,000 before December 31, 2000, the Developer's only recourse against Sensus will be for the reversion of the rights acquired by Sensus pursuant to paragraph 3.

4.2 Price all inclusive and terms of payment - It is estimated that it will take the Developer four (4) months for the first version of the web-site to be developed after Sensus commences funding development with the first advance of $25,000. Prior to commencing work on the development of the AOI Network web-site, Sensus and the Developer will meet to complete a web-site development implementation plan that will form the basis of the work to be performed by the Developer (the "Implementation Plan"). The actual cost of development shall be based upon the actual time it takes the Developer to complete the web-site and train Sensus' employees to use, the Technology (and the cost to be billed to Sensus for any development work representing a portion of a month shall be prorated based on the portion of the month so worked).

4.3 Taxes and other charges -- The price for all of the deliverables described in paragraph 3.1 and 3.2, shall have added thereto, all applicable customs duties, goods and services taxes, provincial sales taxes and any other sales or use taxes as well as any applicable transportation, insurance and freight charges.

5. FUNCTIONAL SPECIFICATIONS

The Parties agree that the AOI Network shall be developed in the manner set forth in the Business Plan which describes the functional way in which the AOI Network will operate (the "Functional Specifications").

6. PROJECT RESPONSIBILITIES

6.1 Developer project co-ordinator -- The Developer shall appoint Graham Heal, as the Project Co-ordinator. The Developer Project Co-ordinator shall assume his or her duties and responsibilities upon execution of this agreement and continue performing them until expiration of the Implementation Period and thereafter the Developer shall provide project management services on a time and materials basis at their then current published rates. The Developer Project Co-ordinator shall have the following responsibilities:

(a) ensure the products and services provided under this agreement conform to the requirements under this agreement;

(b) ensure compliance with the requirements set out under paragraph 3.3;

(c) schedule meetings at a time mutually agreed to by Sensus Project Co-ordinator, to review the project status or communicate problems or difficulties that may be of concern to Sensus or affect Sensus' activities;

(d) attend meetings initiated by Sensus Project Co-ordinator, and

(e) prepare monthly status reports and submit them to Sensus Project Co-ordinator.

6.2 Customer project co-ordinator -- Sensus shall appoint one individual as the Primary Project Co-

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ordinator. Sensus Project Co-ordinator shall assume his or her duties and responsibilities upon execution of this agreement and continue to perform them until the Technology Acceptance Date. Sensus Project Co-ordinator shall have the following responsibilities:

(a) schedule meetings at a time mutually agreed to by the Developer Project Co-ordinator, to review the project status or communicate problems or difficulties that may be of concern to the Developer or affect the Developer's activities;

(b) attend the meetings initiated by the Developer Project Co-ordinator;

(c) facilitate the availability and co-operation of Sensus' personnel;

(d) designate desk space for the Developer Project Co-ordinator, the Developer personnel as determined sufficient by the Developer Project Co-ordinator,

(e) provide controlled access for the Developer to Sensus locations as is necessary to develop the Technology; and

(f) purchase and arrange for the delivery, in a timely fashion, of all of the Hardware necessary, as specified by the Developer Project Co-ordinator, to allow the Technology to be developed and thereafter to allow for the Technology to function according to the Technology Specifications.

6.3 Mutual project responsibilities -- The following are responsibilities that to both the Developer and Sensus Project Co-ordinators:

(a) schedule and attend meetings at least once a week during the Implementation Period;

(b) provide the vehicle for communication of any concerns of their respective staff as far as is practicable.

6.4 Management level meetings -- At Sensus request and with Sensus designated personnel in attendance, the Developer and Sensus shall hold management level meetings to review the general progress of the implementation and specific management related issues. For purposes of such meetings, the Developer and Sensus shall each provide at least one authorised representative with decision-making authority who shall be fully authorised to make commitments on behalf of the Developer and Sensus, respectively, at such meetings.

6.5 Changes -- The Technology and the Custom Developed Technology shall be furnished to Sensus together with all Enhancements. Prior to installation of the Technology on the Hardware, the Developer shall make all required additions and modifications to ensure conformity with the Functional Specifications and the Developer further agrees, that it will, whether requested prior or subsequent to installation to make any minor additions, modifications, or other fine tuning changes upon the written request of Sensus.

7. IMPLEMENTATION AND ACCEPTANCE

7.1 Scheduling -- The installation and testing functions specified in this paragraph 7 and all deliveries of Documentation shall be in accordance with the Implementation Plan, unless otherwise agreed to by the Parties in writing.

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7.2 Installation and site preparation -- Sensus agrees to provide a suitable installation environment in accordance with installation procedures communicated in writing by the Developer to Sensus. Sensus shall give notice to the Developer once the installation environment has been prepared.

7.3 Conditional acceptance of AOI Network

(1) Sensus will throughout the Implementation Period conduct such tests as it deems appropriate to enable it to verify that the Technology functions and performs in accordance with the Functional Specifications on the Computer System (the "Test Period").

(2) If Sensus notifies the Developer in writing during the Test Period that Technology has failed any of the tests set out in paragraph (1), and demonstrates such failure to the Developer, then:

(a) the Developer shall have seven (7) Business Days (the "Cure Period") during which to correct the deficiencies listed by Sensus, and

(b) upon installation of the correction by the Developer, the tests set out in paragraph (1) shall be repeated by Sensus using the same test data.

(4) If the Technology fails the re-test specified in paragraph (3)(b), then the complete process of cure and re-testing as set out in Paragraph (3) shall be repeated once only.

(5) If the Technology fails the final re-test specified in paragraph (4), or if the Developer fails to deliver corrected Technology by the end of either of the Cure Periods, then, at Sensus' option, Sensus may invoke the remedies specified in paragraph 12.

(6) If no written notice of failure has been given by Sensus to the Developer by the end of the initial Test Period, or the re-test set out in paragraph (3), then the Technology shall be deemed to have been conditionally accepted by Sensus.

7.4 Computer system acceptance test

(1) Installation - Installation shall be considered to be complete upon satisfaction of the following conditions:

(a) all the Technology has been conditionally accepted by Sensus pursuant to paragraph 7.3; and

(b) Sensus' staff has received the Training, or at Sensus' request, the Training has been scheduled to occur after the conditional acceptance;

(d) the Developer has delivered all of the Documentation, and

(e) the Developer has certified to Sensus in writing that it has verified that the Technology performs in accordance with the Functional Specifications.

(2) Computer system acceptance test

(a) Sensus shall have thirty Business Days commencing from the day next following the Date

8

of Conditional Acceptance (the "Computer System Test Period") during which it shall be entitled to perform those processes, procedures, and other testing methodologies and results to be obtained therefrom, to verify that all of the components of the Computer System function together in accordance with the Functional Specifications.

(b) The Computer System shall be deemed to have been accepted by Sensus if, at the end of the Computer System Test Period, Sensus has not notified the Developer of any deficiency in the Computer System, the term "deficiency" being a failure of the Computer System, or any of its components, to function together in accordance with the Functional Specifications or a failure to successfully fulfil Sensus' Acceptance Criteria. If Sensus does notify the Developer of any deficiency, the Developer shall have a further twenty Business Day period (the "Computer System Cure Period") during which to correct said deficiencies. The Computer System shall be considered to have been accepted by Sensus if Sensus has not notified the Developer of the continuing existence of such deficiencies or other previously identified, corrected but recurring deficiencies in the Computer System, within five Business Days after the Developer notified Sensus that the deficiency was corrected.

(c) If deficiencies which have been identified by Sensus to the Developer have not been corrected at the end of the Computer System Cure Period, or a plan of correction agreed upon before the end of the Computer System Cure Period, the provisions of paragraph 13 shall apply.

(d) The date upon which Sensus unconditionally accepts or is deemed to have unconditionally accepted the Computer System, the Computer System shall be known as the "Date of Computer System Acceptance".

(e) Where any activity is measured in the Implementation Plan as occurring within a specified number of Business Days, the Developer agrees that it will to the best of its ability undertake and pursue, the required activities as close to the day from the period of time is measured, it being understood and agreed that any such specified period merely delineates the agreed upon time frame for completion of a task and is not to be interpreted as merely an allowance with a terminal date by which a task must be completed.

8. TECHNOLOGY SUPPORT SERVICES

8.1 The Developer shall be responsible for providing, or arranging to have one of its sub-contractors provide, Technology Support Services in accordance with the terms and conditions of the Technology Support Services Schedule, for a period of six (6) months following expiration of the Implementation Period, at the lowest rates at which they provide such services to others.

9. WARRANTIES

9.1 Length of warranties -- The warranties in this paragraph 9 shall:

(1) extend to all updates, upgrades and enhancements made to the Technology pursuant to this agreement, and

(2) apply for a period of one year from the Date of Computer System Acceptance, except as may be otherwise expressly stated in this paragraph.

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9.2 Operational warranties -- the Developer warrants that:

(1) the Custom Designed Technology will be original in design and any rights to be granted hereunder are and will remain proprietary to Sensus and, at the date of this agreement, there are no claims made nor actions pending or threatened regarding the ownership of the Custom Designed Technology or rights to be granted hereunder;

(2) the Technology has been or will be developed, installed and implemented in a proper and workmanlike manner;

(3) the Technology will function in accordance with the Functional Specifications and for a period of one year from the Date of Computer System Acceptance of the Technology;

(4) the Developer has all the rights as are necessary for it to grant the licenses for the use of the Technology as set out in paragraph 10.1;

(5) Sensus shall hold and enjoy the rights to the Technology without any claim, interference or demand whatsoever by the Developer, its successors or any third party;

(6) the Developer shall indemnify Sensus against all liabilities, costs and damages including but not limited to indirect and consequential damages arising out of Sensus' inability to possess and enjoy the license as set out in paragraph 9.2 (5); and

(7) the Documentation is and will continue to be accurate, complete and reflect all changes made to the Technology.

9.3 Limitation of warranty -- The warranties provided in paragraph 9.2 do not apply to modifications to the Technology, other than modifications made by the Developer or its sub-contractors.

10. PROPRIETARY RIGHTS

10.1 Technology Rights

(1) The Developer hereby transfers all rights itemised in Paragraph 3, subject to receiving the 25,000 Sensus shares, and agrees that the rights granted shall be the exclusive rights granted for the use of the Technology.

(2) This License authorises Sensus and Sensus' Affiliates to use the Technology in such applications as they may desire:

(a) to copy the Technology and Documentation in support of the use of the Technology;

(b) to modify or alter the Technology and to merge it into other systems or software as necessary to maximise the use of the Technology and to adjust for changing business conditions; and

to use, copy, modify and enhance the Technology using the Source Materials.

(3) Sensus is entitled to make use of the Technology for Sensus' and Sensus' Affiliates' administrative,

10

accounting and management purposes, without any restrictions.

(4) This Technology is not CPU or machine dependent and may be freely transferred by Sensus by any other class or category of compatible Hardware, without additional payment or charge therefor to the Developer.

(5) The provisions of this paragraph 10 shall apply to all Custom Developed Technology, and Enhancements.

10.2 Patent and copyright indemnity -- The Developer will defend at its own expense any suit or proceedings brought against Sensus based on a claim that any equipment or software product constitutes an infringement of any patent or copyright anywhere in the world, provided that the Developer is notified promptly in writing and given full and complete authority, information and assistance from Sensus for the defence of same. If the foregoing provision is complied with, the Developer will pay damages and costs awarded against Sensus, but the Developer will not be responsible for any compromise made without its consent. If such equipment or software product is held to constitute infringement and its use is enjoined the Developer may, at its election and expense, obtain for Sensus the right to continue using such equipment or software product, modify the same so that it is not infringing, or remove the same and grant Sensus a credit therefore. the Developer will not be liable to Sensus if any infringement claim is based upon the interconnection or use of such equipment or software product in combination with equipment, software products or other devices not made by the Developer use in any matter for which such equipment or software product was not designed.

10.3 Survival -- Paragraph 10.2 shall survive termination of this agreement.

11. TRAINING

11.1 Training schedule -- the Developer shall provide the Training services set out in the Implementation Plan to be developed by the Parties. The Training Schedule shall consist of separate and distinct pre-Installation and post-Installation programs.

11.2 Commencement of training -- Training shall commence from the date of upon which the AOI Network is operational to such extent as would allow commencing the Training activities set out in the Training Schedule.

11.3 Experienced trainers -- All Training will be conducted by experienced personnel of the Developer and the presentations will be adjusted, where possible, to the general level of knowledge and experience of Sensus staff.

12. CONFIDENTIALITY 

12.1     Definition

(1)      "Confidential Material of Sensus" means:

         (a)   any information of a proprietary or confidential nature,
               including but not limited to financial and business information
               relating to Sensus or any Sensus customers which are communicated
               to the Developer at any time;

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(b) any business systems, methodologies or computer programs of Sensus of which the Developer may acquire knowledge in connection with or while performing its obligations under this agreement, and

(c) any other information or data received by the Developer from Sensus that is identified as proprietary or confidential.

(2) "Confidential Material of the Developer" means the Developer portion of the Technology, Documentation and Source Materials.

12.2 Confidentiality obligations

(1) Sensus acknowledges that the Confidential Material of the Developer is confidential and constitutes a valuable asset of the Developer. The Developer acknowledges that the Confidential Material of Sensus is confidential and constitutes a valuable asset of Sensus. Unless otherwise provided under this agreement, Sensus and the Developer shall:

(a) treat the Confidential Material of the other as confidential;

(b) exercise at least the same degree of care and discretion with respect to the Confidential Material of the other as it exercises in protecting its own Confidential Material;

(c) take all necessary steps including but not limited to instruction of employees and agents of the Developer and Sensus to ensure that the confidentiality of the Confidential Material of the other is maintained;

(d) not disclose, publish, display or otherwise make available to other persons any of the Confidential Material of the other, or copies thereof; and

(e) not duplicate, copy or reproduce any of the Confidential Material of the other without the prior written consent of the other.

(2) This paragraph 12.2 does not apply to:

(a) information that is in the public domain or enters the public domain through no breach of confidence by Sensus or by the Developer;

(b) information that is available to one Party from some source other than the other Party without a breach of confidence with the other Party;

(c) general computer technology, ideas, concepts or tools;

(d) information which has been provided in the first instance to someone other than Sensus or the Developer; and

(e) any disclosure as may be required to be made by a court of competent jurisdiction.

13. REMEDIES

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13.1 Remedies

(1) Should the Technology fail to meet or exceed the criteria as set out in the Functional Specifications within the Implementation Period, then at Sensus' option, and without prejudice to any of Sensus' rights under this agreement or at law or in equity, Sensus shall be entitled terminate this agreement and employ its own contractors to complete the work required to allow the Technology to meet the Functional Specifications. In such case Sensus shall be required to pay the Developer for its costs incurred to the date of termination but shall be entitled to deduct therefrom, the added expenses it had to incur over and above that which it would have incurred had the Developer completed the Technology.

(2) If the Developer is delayed by more than ten Business Days in its performance of any activity which is specified for completion by a Performance Date or any extension thereof agreed to by Sensus, then in the absence of Sensus having agreed to any further extension, Sensus may, upon notice in writing to the Developer, terminate this agreement and thereupon the provisions of paragraph 13 shall apply.

(3) If the Developer is unable to correct any deficiency under any of paragraph 7 within the applicable Cure Period, then in addition to any other remedy available to Sensus under this agreement or otherwise available at law or in equity, Sensus shall have the right to terminate this agreement and correct itself or to arrange with someone else to correct any deficiencies, at the Developer's cost and expense.

(4) The remedies of Sensus herein or elsewhere in this agreement are neither exclusive nor mutually exclusive for breaches of other terms and conditions of this agreement or shall any delay or failure of Sensus to exercise any right or remedy available to it in respect of other breaches operate as a waiver thereof, except where specifically provided to the contrary.

(5) If Sensus terminates this agreement as a result of the Developer's default it will, without charge, afford Sensus perpetual use of such components of the Technology as Sensus shall determine.

13.2 Refund -- Upon rejection by Sensus of the Technology pursuant to paragraph 7, or upon termination of this agreement pursuant as a result of the Developer's default, the Developer shall provide a refund, to Sensus, of the additional expenses Sensus has had to incur to ensure the Technology meets the Functional Specifications.

13.3 Obligations on termination -- Any termination of this agreement by Sensus pursuant to any of the provisions of this agreement shall result in:

(1) Subject to the provisions of paragraph 13.1, the termination of all agreements for Technology Support Services. The Developer agrees to indemnify Sensus against all claims, actions or proceedings that may be made or taken against Sensus by any person in connection with the said licenses, subcontracts, and agreements; and

(2) The Developer's obligation to deliver to Sensus all Sensus copies of all available working papers, and all computer programs, documentation, files and output then in the possession of the Developer relating to the Technology.

13.4 Developer default -- In the event of a breach of this agreement by the Developer, Sensus shall be entitled to resort to any remedy or remedies available at law or in equity or any combination of remedies as Sensus may in its discretion determine. No delay or failure of Sensus to exercise any right or remedy will operate as a waiver thereof, except where specifically provided to the contrary. Sensus shall have the right

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to terminate this agreement on written notice to the Developer if the Developer breaches any provision of this agreement and fails to remedy the breach within thirty (30) days after receipt of written notice from Sensus.

13.5 Customer Default - If Sensus fails to make any payment when due and such non-payment shall continue for a period of ten (10) days after notice of default in payment is sent to Sensus, the license to use the Technology shall thereupon terminate, and Sensus shall thereafter have no right to use the Technology or any components thereof. In such event, Sensus shall thereupon be required to:

(1) delete from its Hardware, all copies of the Technology;

(2) return all copies of the Documentation to the Developer.

13.6 Referral of disputes to referee

(1) The Parties acknowledge that for the purposes of amicable resolution of any dispute which may occur between the Parties relating to the interpretation and implementation of any of the provisions of this agreement, it will be in the best interests of the Parties to first refer such dispute for determination to an informal referee. The Parties agree that the purpose of such reference is for the economical and expedient resolution of the dispute and that it shall not be in the nature of arbitration as contemplated by the Arbitration Act, R.S.A. 1990, and that the decision of the referee shall not be binding upon the Parties but shall be considered as a bona fide attempt by the referee to judiciously resolve the matter in dispute. In the pursuance thereof the Parties further agree that either Party may compel the attendance of the other Party before a referee by serving the other Party with notice of such intention which notice shall contain the proposed time and location of the reference and a list of at least three and not more than five proposed referees.

(2) Upon receipt of the said notice, the notified Party shall within five Business Days following receipt select one of the proposed individuals as the referee. In the event that it should fail to do so within five Business Days of receiving such notice, the compelling Party shall be free to select the referee of its choice from the same list. The referee shall be required to proceed to hear and to referee the matter and shall, within the next ensuing ten Business Days or so soon thereafter as may be practical, render his decision in writing.

(3) The compelling Party shall act reasonably in designating the three to five proposed referees and shall in such designation be guided by considerations such as impartiality, industry knowledge, expertise and experience.

(4) The cost of such reference, as determined by the referee, shall be borne equally between the Parties.

13.7 Backup and disaster availability -- In the event that any item of Hardware upon which there is a Technology dependency becomes non-operational at any time for a period of time sufficient to require the use by Sensus of another computer facility in order to maintain business operations, or if any item of Hardware for any reason becomes permanently non-operational, the Developer shall:

(1) use reasonable efforts to promptly provide computer processing time on a fully compatible system which is the property of the Developer, if available at mutually agreed to prices, or

(2) at the request of Sensus, actively participate in the arrangements for the rental of computer time from another the Developer customer with substantially compatible Hardware.

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14. GENERAL

14.1 Order of interpretation -- In the event of any dispute relating to the terms and conditions of this agreement, or the interpretation of this agreement in relation to the obligations of the Parties, or any other matter or thing relating to the Technology, the Functional Specifications and the Integrated Network Configuration, the following shall govern the order of interpretation:

(1) this Head Agreement;

(2) the Business Plan, then

(3) any other component of this agreement.

14.2 Notices -- Any notice, direction or other instrument required or permitted to be given hereunder shall be in writing and may be given by mailing the same postage prepaid or delivering the same addressed to the following addresses:

Developer
Sensus

Any notice, direction or other instrument aforesaid if delivered shall be deemed to have been given or made on the date on which it was delivered or if mailed shall be deemed to have been given or made on the fifth (5th) business day following the day on which it was mailed. Any party hereto may change its address for service of notice by giving notice in writing to the other parties hereto as above provided.

14.3. Time Of The Essence -- Time shall be of the essence in relation to interpretation of this Agreement.

14.4 Laws -- This Agreement shall be governed by and construed and enforced in accordance with the laws of the Province of Alberta.

14.5 Successors -- All the terms, covenants, representations, warranties and conditions of this Agreement shall be binding upon, and enure to the benefit of and be enforceable by the parties hereto and their respective administrators, successors or assigns. This Agreement and the rights and obligations hereunder shall not be assignable by Sensus without the prior written consent of the Developer.

14.6 Amendments -- This Agreement may be amended, modified, superseded or cancelled, and any of the terms, covenants, agreements, representations, warranties or conditions hereof may be waived, only by a written instrument executed by all parties or in the case of a waiver by the party or parties waiving compliance.

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14.7 Waiver -- The failure of any party at any time or times to require performance of any provision hereof shall in no manner affect the right at a later time to enforce the same. No waiver by any party of any condition or of any breach of any term, covenant, agreement, representation or warranty under this Agreement, whether by conduct or otherwise, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such condition or breach or a waiver of any other condition or of any breach of any other term, covenant, representation or warranty under this Agreement.

14.8 Headings -- The headings contained in this Agreement are inserted for convenience of reference only and shall not otherwise affect the meaning or interpretation or be deemed a substantive part of this Agreement.

14.9 Severability -- If any provision of this Agreement shall hereafter be held to be invalid or unenforceable for any reason, that provision shall be reformed to the maximum extent permitted to preserve the parties' original intent, failing which, it shall be severed from this Agreement with the balance of this Agreement continuing in full force and effect. Such occurrence shall not have the effect of rendering the provision in question invalid in any other jurisdiction or in any other case or circumstances, or rendering invalid any other provision contained herein to the extent that such other provisions are not themselves actually in conflict with any applicable law.

14.10 Counterparts -- For convenience, this Agreement may be executed in several counterparts, each of which so executed shall be deemed to be an original and such counterparts together shall constitute but one and the same instrument.

In witness whereof the parties have executed this agreement with effect the date and year first above written.

SENSUS CAPITAL CORP. 

Per: /s/ (signature illegible)
     _____________________________________

ALLTEAM ONLINE INC.

Per: /s/ (signature illegible)
     ___________________________________

SCHEDULE "A"

BUSINESS PLAN

ALLTeam Online, Inc. (AOI)

An online media company to bring out the star in all of us.

TABLE OF CONTENTS

Executive Summary

Mission Statement 

1.       Business Definition

2.       Market Definition

         2.1      Internet Industry & Growth
         2.2      E-Commerce Industry & Growth
         2.3      Streaming Media - What is it and how will it grow?
         2.4      HighlightReel.com - A User Profile
         2.5      Encoding for Streaming Media - A Revenue Opportunity
         2.6      Business & Market Assumptions

3.       Programming

3.1      Content

         3.1.1    HighlightReel.com Site Structure & Functionality
         3.1.2    User Incentives
         3.1.3    Other Content Offerings & Services

         3.2      Content Partnerships
         3.3      Community Service & Relations
         3.4      Premium Content Store
         3.5      Data Acquisition - A Streaming Media Encoding Partnership
         3.6      Future Market Development

4. Revenue Model Summary

5. Market & Distribution

5.1 Image & Positioning
5.2 Strategic Distribution Partnerships
5.3 Affiliate Program
5.4 Direct Marketing
5.5 Advertising

6. Operations

6.1 Corporate Finance
6.2 Organization
6.3 Principals

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6.4 Other Key Hires
6.5 Contracted Services
6.6 Directors

7. Major Cost Items

8. Risks

9. Competition

10. Critical Keys to Success

11. Second Stage Content Channels & Businesses

12. Financials

13. Appendices

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EXECUTIVE SUMMARY - ALLTEAM ONLINE, INC.

Online content and new media development is an exciting and wide open industry made possible by the emerging acceptance of the Internet as the mass-market communications and information medium of the 90's and the coming 21st Century. ALLTeam Online, Inc. (AOI) is a Seattle based online and Internet media & commerce company that will be the most recognized network of niche Internet portal sites and WebTV/set top channels utilizing streaming media to present original, copyright-free, entertainment content in multiple categories including sports, film and comedy. This collection of sites and channels will become the AOI Network.

AOI's objective is to build a scalable, easily replicated platform from which the innovative and entertaining theme sites and communities can be developed and introduced on the Worldwide Web. AOI will launch its first branded property from its family of sites known as HighlightReel.com. This property will become an online mecca for athletes and sports enthusiasts of all ages that are entertaining, interactive, and fun. In simple terms, HighlightReel.com users are asked to submit their very own sports highlights captured on their vide camcorder or other video capture device. HighlightReel.com houses and hosts the copyright-free highlights on its web site or channel arranged by sport or activity and state/province so that any family member, friend or fan can access it via a regular Internet connection to the Worldwide Web. Regular corporate sponsored promotions will take place at the site where highlights are judged by the audience and winners are awarded great prizes, merchandise and scholarships to academic institutions. One might say it's like the online "StarSearch" of the 90's. The spirit of competition, desire to be seen, show off your talents and winning valuable prizes and awards keep participants coming back over and over.

Sports is one of the top three areas of interest for Internet users. While there is a multitude of Internet sites catering to all aspects of professional sports today (e.g. ESPN Sportszone, CBS Sportsline there are very few online properties bringing non-professional athletics and sports activities together in a compelling entertainment package. Sports played in schools or community leagues is a strong rallying point in North American society and everyone likes to be recognized for their achievements. HighlightReel.com will appeal to anyone's desire to be a star and be seen literally anyone surfing the Web, now a potential audience of 100 million plus users worldwide and growing. Through HighlightReel.com anyone or any team can have a channel to showcase their game-winning touchdown or buzzer-beating basket.

In the US and Canada there are over 60 million participants in amateur sporting activities whether it be as part of school athletics, community centers and associations or city leagues. With this large pool of potential players, contributors and audience members already owning or able to easily access video capture equipment and almost anyone can participate. As hosting of the

4

content online is provided essentially as a free service in order to drive rapid growth of the sites' body of content, revenues will be generated by:

o Advertising;
o Merchandising Partnerships;
o Corporate Sponsorship;
o Encoding fees (involves the specific conversion process of standard video to "encoded" internet-ready streaming content -- a must for broadcasting online);
o Value-added and copyrighted entertainment content sold on a per use and perpetual license basis from the HighlightReel.com Streaming Store;
o Production and broadcast of live and taped sports events via streaming on the Internet.

Families with sports participants and vide camcorders represent a very attractive demographic that advertisers and merchandisers want and parents are very enthusiastic about their children's participation in sports and athletics and will embrace ways to raise their child's profile and recognition. Parents will also appreciate HighlightReel.com's association with scholarship and its focus on offering awards that can impact children's futures. Result -- motivated users hunger for a visibility form that is also entertaining and fun! And what kid doesn't like to see him or herself on screen or call friends and say "check out my personal HighlightReel.com site! AOI will be there to serve, entertain and reward them.

The Company will benefit greatly by establishing its operations in Seattle, the streaming media technology and content nexus led by industry giants RealNetworks, Microsoft and Disney's Starwave. An initial key strategic partnership has already been forged with a streaming media encoding leader and Seattle neighbor. The greater Seattle area also offers a strong, skilled pool of talent with experience in online streaming content development and publishing. Further the principals have large personal contact bases of Internet and E-commerce professionals who can be attracted to the venture as key hires or contractors. Similarly the principals will use their extensive industry contact bases with key management personnel at major Internet media and traffic leaders to establish "anchor" distribution arrangements ensuring a strong audience and user base.

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MISSION STATEMENT

"To be the recognized network of branded niche Internet portal sites and WebTV/set-top channel leveraging streaming media technologies to showcase original, copyright-free, entertainment content in multiple categories including sports, film and comedy. In short an entertainment network and online community for everyone, populated with content produced by anyone."

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1. BUSINESS DEFINITION

Online content and new media development is an exciting and wide open industry made possible by the emerging acceptance of the Internet as the mass-market communications and information medium of the 90's and the coming 21st Century. ALLTeam Online, Inc. (AOI) is a Seattle-based online and Internet media & commerce company that will be the most recognized network of niche Internet portal sites and WebTV/set top channels utilizing streaming media to present original, copyright-free, entertainment content in multiple categories including sports, film and comedy. This collection of sites and channels will become the AOI Network.

AOI's objective is to build a scalable, easily replicated platform from which innovative and entertaining theme sites and communities can be developed and introduced on the Worldwide Web. AOI will launch its first branded property from its family of sites known as HighlightReel.com. This property will become an online mecca for athletes and sports enthusiasts of all ages that is entertaining, interactive, and fun. In simple terms, HighlightReel.com houses and hosts the copyright-free highlights on its web site or channel arranged by sport or activity and state/province so that any family member, friend or fan can access it via a regular Internet connection to the Worldwide Web. Regular corporate sponsored promotions will take place the site where highlights are judged by the audience and winners are awarded great prizes, merchandise and scholarships to academic institutions. One might say its like the online "StarSearch" of the 90's. The spirit of competition, desire to be see, show off your talents and winning valuable prizes and awards keep participants coming back over and over.

Sports is one of the top three areas of interest for Internet users. While there is a multitude of Internet sites catering to all aspects of professional sports today (e.g. ESPN Sportszone, CBS Sportsline) there are very few online properties bringing non-professional athletics and sports activities together in a compelling entertainment package. Sports played in schools or community leagues is a strong rallying point in North American society and everyone likes to be recognized for their achievements. HighlightReel.com will appeal to anyone's desire to be a star and be seen by literally anyone surfing the Web, now a potential audience of 100 million plus users worldwide and growing. Through HighlightReel.com anyone or any team can have a channel to showcase their game-winning touchdown or buzzer-beating basket.

In the US and Canada there are over 60 million participants in amateur sporting activities whether it be as part of school athletics, community centers and associations or city leagues. With this large pool of potential players, contributors and audience members already owning or able to easily access video capture equipment almost anyone can participate. As hosting of the content online is provided essentially as a free service in order to drive rapid growth of the sites body of content, revenues will be generated by:

7

o Advertising;
o Merchandising;
o Corporate Sponsorship;
o Encoding fees (involves the specific conversion process of standard video to "encoded" Internet-ready streaming content - a must for broadcasting online);
o Value-added and copyrighted entertainment content sold on a per use and perpetual license basis from the HighlightReel.com Streaming Store;
o Production and broadcast of live and taped sports events via streaming on the Internet.

Families with sports participants and video camcorders represent a very attractive demographic that advertisers and merchandisers want and parents are very enthusiastic about their children's participation in sports and athletics and will embrace ways to raise their children's profile and recognition. Parents will also appreciate HighlightReel.com's association with scholarship and its focus on offering awards that can impact children's futures. Result - motivated users hungry for a visibility form that is also entertaining and fun! And what kid doesn't like to see him or herself on screen or call friends and say "check out my personal HighlightReel.com site?! AOI will be there to serve, entertain and reward them.

2. MARKET DEFINITION

The growth and future of the Internet as a medium of mass communication, information and entertainment is no longer a matter of speculation as it was in 1994 or 95, but a self-evident reality. As network bandwidth pipelines expend and increase speed to keep pace with market and technology demands a wider range of compelling content will not only be available but home consumers will be equipped to receive and enjoy in very high quality. Sure the big media players like Time Warner and Disney will be there producing excellent mainstream entertainment like they always have but independent new media companies like AOI will fill the niches. And these niches will represent the majority of all content available on the Internet making AOI an exciting opportunity.

Let's review some basic yardsticks of Internet growth, usage, commercial activity and multimedia content development to understand the scale of the opportunity:

2.1 INTERNET INDUSTRY & GROWTH

o Fewer than 40 million worldwide were connected to the Internet in 1996. By the end of 1997, more than 100 million people were using the Internet. Some experts believe that one billion people may be connected by 2005.
- US Dept. of Commerce, "The Emerging Digital Economy". 4/98

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o As of the 12/96, about 627,000 Internet domain names had been registered. By the end of 1997, the number domain names more than doubled to reach 1.5 million.
- US Dept. of Commerce, the "Emerging Digital Economy". 4/98

o Traffic on the Internet has been doubling every 100 days.
- US Dept. of Commerce, "The Emerging Digital Economy". 4/98

o More than 58 million adults in the US & Canada use the Internet representing 45% of the potential market.
- CommerceNet & Nielsen Media Research, 5/98

o Nearly 45 million PCs in the US access the Internet regularly, a 43% increase from 1st quarter of 97 to 1st quarter 98.
- Ziff-Davis, 5/27/98

o The number of PCs that use the Internet has grown more than 140% in the past two years, from 18.6 million in 1/98 to 45 million in 1/98.
- Ziff-Davis, 5/27/98

o "About one in three workplace PCs access the Internet, and nearly one in tow home PCs does the same. In just two years, the Internet has become a home PC mainstay.
- Ziff-Davis, 5/27/98

o "The average Internet PC was connected to the net 4.5 hours a week therefore Internet "eye-ball hours" increased some 80% in the last year. It's no wonder that more and more companies are looking to the Internet as an advertising medium to reach their customers. What other medium grew 80% in the past year?"
- Ziff-Davis, 5/27/98

o Online traffic momentum based on web page views grew 430% in the past year at Excite.com
- Excite, Inc., 2/9/98

o Ad spending grew on average 27% in one quarter (Q3-Q4 97) at the four largest search engines/web portals (Excite, Yahoo, Lycos, Infoseek).
- Excite, Inc., 2/9/98

o Total Internet ad spending was $907 million in 1997. It is projected to top $1.4 billion in 1998, an increase of 55%.
- Internet Advertising Bureau, 6/98

o Sports sites overall were winners in June, 98 in terms of total traffic and visitors.

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- June Web Report, Relevant Knowledge. 6/98

o Venture Capitalists provided $12 billion to hundreds of IT start-ups in 1996 and 1997.
- US Dept. of Commerce, "The Emerging Digital Economy", 4/98

o Venture Capitalists poured a record $567 million into Internet start-ups Q2 1997 and another $460 million in Q1 1998. Michael Moritz of Silicon Valley's Sequoia Capital says "I don't think we have yet seen even 10% of all the interesting new ideas related to the emergence of the Internet".
- Wired Technology News, 7/15/98

2.1 E-COMMERCE INDUSTRY & GROWTH

Here are some facts that point to the emergence, growth entrenchment of commerce and retailing online:

o By 2002, the Internet may be used for more than $300 billion worth of commerce between businesses.
- US Dept. of Commerce, "The Emerging Digital Economy". 4/98

o A total of 10 million PCs used the Internet to shop for e-purchases in 1997.
- Ziff-Davis, 5/27/98

o Internet users are split 55.8% males, 44.2% females with median household income at $55,740 who will spend $360/yr just on Internet access in 2001.
- Forrester Research, Inc., 12/97

o Today it's mass-market book titles (that are selling new), reflecting the mainstream consumers now on-line.
- Forrester Research, Inc. 12/97

o Today's online shoppers are satisfied and ready for more. They are hooked on the convenience of this new experience.
- Forrester Research, Inc., 12/97

o During the next five years, the market will quadruple in size to 43 million on-line shoppers, slightly less than 50% of the on-line audience.
- Forrester Research, Inc., 12/97

o By 2000, web households will purchase on-line an average of ten times per month.
- Excite, Inc., 2/98

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o In 1996, Amazon.com, the first Internet bookstore, recorded sales of less than $16 million. In 1997 it sold $148 million in books to Internet customers.
- US Dept. of Commerce, "The Emerging Digital Economy", 4/98

o In January 1997, Dell Computers was selling less than $1 million of computers per day online. During the December 97 holiday period Dell reported reaching $6 million in daily sales several times.
- US Dept. of Commerce, "The Emerging Digital Economy", 4/98

o Categories leading ad spending during Q1 98 were computing (27%), consumer products (25%), telecom (14%), financial services (13%) and new media (10%). Banner advertisements continue to dominate spending at 55% with sponsorships making up 40%.
- Internet Advertising Bureau, 6/98

o Use of the Internet and online services by the American public is reducing the time devoted to other prominent daily activities such as watching TV, exercise and reading. 64% of Internet users report the use of the Internet has reduced the amount of time they spend watching TV or using a VCR.
- Strategies Group Internet User Trends Report, 6/98

o Total Internet spending by businesses and consumers will increase to $500 billion worldwide in 2002.
- IDC White Paper, 6/98

2.3 STREAMING MEDIA - WHAT IS IT AND HOW WILL GROW?

As recently as 1995 the prospect of listening to high quality audio or watching passable video over the Internet was limited to discussions at cocktail parties. With the great majority of Internet users still suffering through online sessions at modem speeds of 14.4 kps, or maybe 28.8 kps, a real opportunity to develop a solution to "stream" audio and video within existing bandwidth constraints arose. While a variety of innovators jumped into the fray it was RealNetworks of Seattle that developed a technology, the RealPlayer, which at the end of 1997 had over 20 million unique users. Further RealNetworks' RealSystem and servers are now used to deliver content on more than 85% of all streaming media enabled web pages. Microsoft also waded into the streaming technology market and invested in RealNetworks, licensed its technology and released its own streaming media platform, Netshow. Seattle is now the worldwide streaming technology nexus and the home to a burgeoning number of online content developers and media companies leveraging these streaming technologies.

What's the impact of high quality streaming? In the 4th quarter of 1997 alone, total web pages containing streaming media doubled. Every week 145,000

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hours of sports, music, news and entertainment are broadcast over the Internet. For broadcasters like Seattle's Starwave (recently purchased by Disney) who produces ESPN Sportszone, CNN and Playbill Online, live and on-demand streaming programming is one its most popular features. What sites like Starwave have found is that by enhancing the experience with streaming media they INCREASE TRAFFIC, KEEP VISITORS COMING BACK AND STAYING LONGER WHILE GENERATING MORE SALES. Unlike text and pictures the Internet comes alive with streaming media and can deliver on its potential to become a mass medium comparable on scope with TV and radio.

Streaming media enhances and expands the quality and scope of offerings for online content producers, broadcasters, advertisers and merchandisers. As Streaming takes greater hold it is expected to increase consumer demand by greatly improving the users' experience, and accelerate a shift in advertising revenues away from traditional media to the Internet. In fact Forrester Research predicts that advertising revenues from online content businesses will grow to $8.5 billion by 2201 or 5% of all ad spending valued at $175 billion in 1996.

But while streaming will be a catalyst to many facets of online growth it requires help from bandwidth providers to fulfill its promise - and there is good news! Standard Internet access via 28.8 kps or 56k modems puts limitations on streaming quality and the race is on from a host of telecommunications players to lay the infrastructure and offerings for the next generation of high speed Internet gateways. Whether it be DSL technologies from major telcos like GT, cable modems from consortiums like AT&T/TCI?@Home or wireless, satellite or even electric utilities, high speed access will be available throughout North America shortly. Once these service offerings, ranging up to 10 Mps, are embraced by bandwidth hungry consumers opportunities for content providers to deliver superior products will be countless. When bandwidth is coupled with ever-improving streaming technologies we expect more and more people will want to put their own audio and video clips online. AOI will be ready to maximize this opportunity.

2.4 HIGHLIGHTREEL.COM - A USER PROFILE

It is worth noting some online user dynamics recently identified by Forrester Research. HIGHLIGHTREEL.COM will appeal to a huge user base including online segments Forrester calls "Neo-hearthminders", who are families with kids and multimedia starved, entertainment-oriented "Mouse Potatoes". These segments currently cover 43.3 million people in the US, of which only 45% are currently on the Internet today.

It is this piece of the Internet usage market that we believe will be most affected by the emergence and growth of the TV set-top box access roll-out. Notably Microsoft acquired WebTV in 1997 based on its belief that a great number of new users who may not be power computer users would readily adopt the Internet

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through their televisions. America Online has also announced the launch of its "AOL Anywhere" service which target new and existing users who will access the Internet through new devices including screen phones, handheld PCs and especially the TV. It is particularly the "Neo-hearthminders" with children that will seriously consider Internet access through what may be more convenient or familiar devices and the bulk of WebTV/set-top access services will be directed at them. This is an opportunity for AOI in that we will position HighlightReel.com to appeal to this market by creating entertaining web properties as well as targeted WebTV/set-top "channels". A speedy build-out by AOI will allow it to ride this growth curve.

HIGHLIGHTREEL.COM'S potential user base can be segmented into a variety of groups:

Players: HIGHLIGHTREEL.COM'S participants or "Players" (highlight subjects) represent a huge and diverse group including k-12 kids participating in school or community sports, university and college student-athletes and adults in city, community or corporate leagues. These groups participate in a huge range of activities in sports and athletics and represents 60 million individuals in North America. Many would enjoy, and be entertained, by the exposure HIGHLIGHTREEL.COM offers them. They will also be able to compare their talents with other players in their age group or league and continue friendly competition and sportsmanship online.

Behaviour Trait - "They want to be stars, or at least have a shot".

Capture-Meisters: This sub-set as all those with video capture equipment like camcorder who will be seeking the best highlight or shot of their child, student or school pal. It is in this group's hands not only to get best highlight but also capture it with the highest level of quality, skill and clarity. Parents, coaches and team mates are the artists in this group. With video camcorders already a staple household appliance entry costs are low and the ability to capture and broadcast a large body of highlight content from a multitude of contributors is viable. Another encouraging trend is that digital camcorders are the fastest growing segment of the home movie market and are expected to reach $2.7 billion is sales in 1998 and 50% of all camcorders sales by 2002.

Behaviour Trait - "They want to ensure their Players get their shot and are recognized for their efforts", or "consider themselves damn good directors".

Family, Friends, & Fans (F3's): This is highly a motivated audience group for HIGHLIGHTREEL.COM as they are closely associated with participants and are keen to follow their progress and see how they stack up. They are also often spread out geographically and viewing video of loved ones on the Internet is much more convenient and immediate than mailing around a bunch of VHS tapes. Give this

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group new highlights of their favorite star and they will return over and over again.

Behaviour Trait - Very nurturing and territorial - "Jimmy next door is on that site so Johnny Jr. should be too" or "Let's check out that Granddaughter's latest soccer goal highlight".

Recruiters: While this may be a smaller user sub-set it is a very motivated one. By viewing highlights at our site Recruiters from colleges or junior hockey for example may find a diamond in the rough. Another proposed AOI property will be introduced later to leverage this group. At CentralScouting.com highlights will be archived by age, sport and state/province on a release basis so that registered coaches and recruiters may review highlights of potential talent moving up to the next level and make contact with them.

Behaviour Trait - "That kid up in Maine was phenomenal but have you checked out that winger from Boston? Wow!!"

2.5 ENCODING FOR STREAMING MEDIA -- A REVENUE OPPORTUNITY

HIGHLIGHTREEL.COM can host highlight clips in a superior destination site but there is a critical step in highlight clip preparation prior to presenting audio and video on the Internet as streaming media. Every audio and video transmission over the Internet requires compression and conversion from the original recording or production format. This is called "encoding" and it is required for all video recording formats from traditional VHS or Beta formats to the many new digital formats including QuickTime, Microsoft NetShow or RealNetworks RealVideo. Beyond the actual conversion process a skilled encoder can also enhance the original content quality with a variety of techniques and use of state of the art digital encoding equipment.

It is possible for home users to purchase encoding equipment and software required to publish their video and audio content on the Internet. However the cost is high and the time required to master the skill is considerable. It's the perfect process for an "as-needed" service business rather than making an investment in rapidly changing technologies and "moving target" standards. In many respects it's like "FotoMat" for the Internet where your original audio and video is "developed" for streaming onto the Internet. It is AOI'S assessment that a strategic partnership with a market leader providing optimized encoding services is crucial both in terms of offering a comprehensive package for our users and establishing a predictable, ongoing revenue stream. A partnership with a qualified firm has been secured and will be discussed in Section 4.

2.6 BUSINESS & MARKET ASSUMPTIONS

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o        HIGHLIGHTREEL.COM can be successfully positioned and marketed as the
         "COOL" site for players and teams to showcase their highlight clips and
         let their friends, family and fans follow their sports journeys and
         endeavors;

o        Players, teams and coaches are motivated by the pursuit of recognition
         of their achievements to the extent they will capture, submit, encode
         and publish their highlights at HIGHLIGHTREEL.COM;

o        Players will be further motivated to play by the potential of winning
         exciting prizes, like sports equipment from top manufacturers, and
         athletic and academic scholarships at top institutions;

o        University and college-level athletic recruiters will value a large
         archive and clearinghouse for player highlights as a resource for
         identifying up and coming talent;

o        Advertisers and merchandisers will value the site's large and diverse
         user group projected to be over 90 million in North America. As the
         Player group includes the "hard to crack" teen demographic advertisers
         and merchandisers will actively attempt to establish long term brand
         loyalties at the site;

o        Compelling sponsorship products will entice corporations to associate
         and partner with HIGHLIGHTREEL.COM for visibility, brand-building and
         will actively participate in the provision of valuable merchandise and
         prizes and underwrite coveted scholarships at academic institutions;

o        Leaders in online content, media and access will wish to license or
         share ad revenues in exchange for use of HIGHLIGHTREEL.COM branded
         content. These partnerships will also be integral for increasing
         visibility of the site, entrenching brand awareness and driving high
         player participation;

o        Other strategic partnerships and associations with organizations such
         as DARE, the NCAS, Net Nanny or Pop Warner, will enhance
         HIGHLIGHTREEL.COM'S credibility and standing with its main users and
         constituents;

o        A HIGHLIGHTREEL.COM interface and we site with easy to use templates
         and formatting can be created with off-the-shelf tools and relatively
         little development and creative time and cost;

o        A variety of outsourced providers can be contracted as alternatives to
         building systems in-house such as Web servers and hosting, data
         warehousing, bandwidth management etc.;


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o        Hosting highlight clips free will quickly populate the site with
         content and audience. Encoding services can be offered at price points
         appealing to the user while maintaining margins for the service
         supplier-partners and revenue shares for AOI.

3.       PROGRAMMING

AOI will become an online partner synonymous with entertaining users who are the authors of their own fun. By giving our Players a simple to use online channel where their sports highlights are available for viewing by a worldwide audience 24 hours a day we offer anyone a chance to be a star. AOI has secured the following Internet web site domain names which will form the family of properties to be built-out and leveraged: 

HIGHLIGHTREEL.COM                   STUDENTATHLETE.NET
HIGHLIGHTPACKAGE.COM                CENTRALSCOUTING.COM
LEAGUEZONE.COM                      ATHLETICSCHOLARSHIP.COM
STUDENTATHLETE.COM

Initially HIGHLIGHTREEL.COM will be the charter property to be developed by AOI. Here is how we propose to do it.

3.1 CONTENT

In the simplest terms HIGHLIGHTREEL.COM will leverage its user base to populate itself with content by hosting and broadcasting highlight clips submitted by Players and Capture-Meisters. This methodology will also give rise to a loyal audience of F3's who are pulled to HIGHLIGHTREEL.COM to view each Player highlight clip. A further benefit is that the majority of content for the site will be acquired at virtually no cost. Players will be incented to participate and submit view clips on a repeat basis through a series of monthly and annual competitions to select the best highlights. Winners will be awarded with a variety of valuable prizes and scholarships to academic institutions of their choice. AOI feels very strongly about the positive relationship between athletics and scholarship and believes this focus will be viewed very positively by Players, F3's and indeed all site visitors.

3.1.1. HIGHLIGHTREEL.COM SITE STRUCTURE AND FUNCTIONALITY

Player highlight clip submissions of up to 3 minutes will be accepted from any state or province in the US or Canada and hosted absolutely free of charge (Encoding for streaming media will be offered for a fee and is detailed in 3.4). This site will be arranged into an easy to navigate and browse graphical interface so site visitors will be able to find what they want quickly. Generally speaking the interface and highlight clip archive will be segmented and organized by:

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- Gender;
- Sport of activity;
- Age Groups (3) (Child - p to 12, Teen - 13 - 18, Adult).

This site will not distinguish between levels of athletics eg. Varsity, JV, Intramurals, etc., but will accept and judge clips on their level of skill, endeavor and even uniqueness.

Once a highlight clip has been received by the site it will be assigned a specific URL and posted to the main site index. The Player and/or person making the clip submission will be notified by e-mail of the URL. As part of the free hosting service the site will also as the user if he or she would like HIGHLIGHTREEL.COM to notify any others about the URL which it will do if supplied with the addresses. Basic Player profiles will be requested but due to sensitivity regarding minors' personal information only data supplied will be posted. Completely confidential clips without Player profiles are acceptable but unpublished registration information is mandatory. At the time of writing the highlight clips will be hosted at HIGHLIGHTREEL.COM for two months before they are removed. AOI may adjust free hosting period based on the data loads and bandwidth optimization as the quantity of content grows.

It should be noted that once users have a URL for a particular clip they also require a "viewer", or software to enjoy this or any other clips hosted at the site or anywhere on the Internet. Already 20 million Internet users have versions of REALNETWORK'S, "REALPLAYER" or MICROSOFT'S NETSHOW so the ability to view clips is already firmly entrenched within the computer desktop. For those users still requiring a "viewer" a link to download free versions from multiple courses will be offered at the site. The site will also host an educational step-by-step streaming tutorial on how to shoot better, winning highlight clips with tips on editing and submitting video in the proper format. The better the quality of videos received the better the content will be at HIGHLIGHTREEL.COM.

3.1.2 USER INCENTIVES

While simply offering free hosting of highlight clips and the opportunity to be broadcast as part of a new media "channel" may be enough incentive for many Players to joint in at HIGHLIGHTREEL.COM we will not leave this to chance. To keep players posting new highlights on a regular basis and to keep F3's and our audience at large highly involved AOI has devised a valuable incentive program for all of our constituents. The cornerstone incentives will be in-house and 3rd party corporate sponsorship programs where the best highlight clips will be rewarded with compelling prizes and academic/athletic scholarships. One possible reward program is as follows:

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o Three monthly highlight clip awards, one per age category (Child, Teen, Adult) for each major sport. Awards to be $1000 approx. in merchandise or scholarship value;

o Three annual Grand Champion highlight awards, one per age category for each major sport. Awards to be $10,000 approx. in merchandise or scholarship value.

A combination of judging formats are being considered will be utilized including in-house HIGHLIGHTREEL.COM editors, celebrity judges such as pro athletes & coaches and an audience voting process via automated online balloting and selection i.e. like Major League Baseball All-Star Game voting. The audience voting format is an interesting one in terms of driving additional audience traffic. If promoted that awards were based on highest "click-thru's (literally how many times it was seen) we can expect that Players will ensure that everyone they know visits their personal highlight URL to check out their latest highlight clip. This judging process is ultimately the most democratic, least subjective and is tied to a standard online measurement parameter that is verifiable (multiple viewings by the same address will be excluded). These techniques will be explored in detail.

A comprehensive sponsorship program will be created and marketed to online advertisers and merchandisers who will want to associate their company and products with the HIGHLIGHTREEL.COM brand its diverse usership. While the bulk of the sponsorship fee will secure a minimum level of enhanced visibility at the site a portion will cover the award cost commitment. Sponsorships will be priced for varying visibility values including annual and monthly positions. A wide range of award sponsorship packages outside the main monthly and annual offerings are possible. There are some hypothetical examples:

Nike sponsors an ongoing, annual "anchor" feature known as the "HIGHLIGHTREEL.COM GRAND CHAMPIONSHIPS" involving high visibility and placement and contribution of $30,000 for three major awards. Tie-ins with complementary TV and in-store advertising programs run by Nike are possible;

Rawlings sponsors "Golden Glove Award" for defensive play in baseball for monthly highlight clip winner during baseball season;

CompUSA sponsors a monthly award sponsorship for best football highlight and awards a new PC package to winner;

Sony sponsor a video clinic online with a streaming tutorial including tips on capturing better highlights and features its latest digital AV equipment packages.

As part of general site programming regular features such as rotating viewing buttons of top highlights archived at HIGHLIGHTREEL.COM will always be available.

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Sponsorship packages such as "Top 10" clips of the month, "Simply the Best" clips from all archives or "Hot out of the Can" featuring the latest submissions will also be programmed and marketed. These will give users a yardstick of quality to shoot for and ensure that above average content is always a mouse click away.

Scholarship will be heavily promoted as one of the main missions of HIGHLIGHTREEL.COM - to promote athletics as a vehicle to achieving, and as an integral part of, academic success and growth. It is the intention of AOI to give award winners the ability to select merchandise or a scholarship as their prize. Scholarship funds for post-secondary institutions will be held in trust until valid proof of enrollment is submitted by winners. An appointed trustee (such as Ernst & Young) will be entrusted with scholarship funds and responsible for their disbursement towards tuitions or other acceptable academic costs or expenses. The winner is free to select which post-secondary institution the scholarship funds will be used at. An adult winner is free to allocate scholarship prizes toward their child or anyone of their choosing.

3.1.2. OTHER CONTENT OFFERINGS & SERVICES

In addition to its core content focus HIGHLIGHTREEL.COM will also integrate a variety of entertaining offerings, many of which will provide additional sponsorship opportunities:

o Develop branded "HIGHLIGHTREEL.COM" sporting events for "webcasting" to an Internet audience such as the "HIGHLIGHTREEL.COM High School Basketball All-Star Game" featuring seniors who submitted the best highlights clips form the just concluded season. AOI will also seek out opportunities to simul-webcast 3rd party produced sports events, such as the NCAA Ice Hockey National Championship Series, and build sponsorship vehicles around them;

o Integrate entertaining chat rooms into content that is conducive comparison and discussions about highlight clips;

o Publish sports-related information and multimedia presentations including coaching tips and clinics, training methods and regiments, injury prevention and treatment;

o Merchandise a wide variety of offerings for sports equipment, team apparel and gear, or video capture and editing equipment targeted to HIGHLIGHTREEL.COM'S community of loyal, repeat users;

o Establish a HIGHLIGHTREEL.COM discount club with major sporting goods merchandiser for athletes and teams;

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This site will also launch other co-branded sites and channels that branch from HIGHLIGHTREEL.COM, offering complementary content that is of interest to our core usership and audience. Here are two possibilities under consideration:

ATHLETIC SCHOLARSHIP.COM WILL OFFER:

o Academic development tools and information including study skills enhancement, tutoring resources, time management, SAT preparation, goal setting, etc.;

o Resources to assist student athletes access and win athletic and academic scholarships by providing a clearinghouse and database of available programs. Information concerning potential financial support and sponsorship from sports foundations will also be available;

CENTRALSCOUTING.COM WILL OFFER:

o A special zone for athletic recruiters from university and college institutions searching highlight archives for high school recruits. High school players will have the opportunity to submit additional personal information along with their highlight clip in this zone such as statistics, profiles, GPA's, SAT's etc.

o AOI has already identified two new and innovative online services targeted at university and college athletic departments and allowing them to search databases of high school recruits and their profiles. Online Scouting Network (www.osn.com) and Scout Net (www.scout-net.com) both offer players the opportunity to post their profile and video clip for a fee of $70 - 150. AOI has already initiated discussions with these firms and is hopeful to establish commercial partnerships with one or both. In this case HIGHLIGHTREEL.COM would co-brand and offer these value-added services to its users on a revenue share basis.

3.2 CONTENT PARTNERSHIPS

In addition to the "backbone" content and services previously discussed AOI will seek partnerships with a wide variety of organizations to supply compelling and entertaining content targeted at our core usership. It will be AOI'S continuing challenge to offer the most valuable content possible to its users and audience and partnerships to secure and offer these elements are a major key to success.

Some examples may include:

o The National Coaches Association and a corporate sponsored property such as Gillette's "You Make the Call" team up to provide content on clinics, training and rules;

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o NCAA and its divisions such as "The Big Ten", offer content related to qualifying for and becoming an intercollegiate athlete, and in promoting specific institutions for college consideration;

o Previously discussed partnerships with recruitment services such as Online Scouting Network or ScoutNet;

o Major online sports properties, like CNNSI or ESPN Sportszone offer specific pro sports content that is complementary to HIGHLIGHTREEL.COM in exchange for traffic. An excellent example - Sports Illustrated Magazine print version has a well known feature known as "High School Roundup" featuring outstanding student athletes from across the nation each week. This could be leveraged online at HIGHLIGHTREEL.COM;

o Team up with Broadcast.com and simulcast the video portion of a major sports event it is providing via radio webcast for eg. NCAA Baseball Championships.

o Leverage the RealNetworks' Site Partner Program as a one of a family sites fully embracing and extending usage of the Real streaming media platform for content, advertising and merchandising. This will quickly position HIGHLIGHTREEL.COM as a streaming content leader along with other members including Wall Street Journal Interactive and Rolling Stone Network. An outstanding opportunity presents itself for RealNetworks to host a content area at HIGHLIGHTREEL.COM devoted to tips for capturing and producing the best highlight clips possible.

3.3 COMMUNITY SERVICE & RELATIONS

AOI, INC. intends to develop the "HIGHLIGHTREEL.COM Foundation" to create key relationships and initiatives which enhance and extend its profile in the community while helping student athletes:

o Develop partnerships with "grassroots" community programs like "D.A.R.E." and "Stay in School";

o Create a corporate sponsorship program to award coveted "HIGHLIGHTREEL.COM Academic All American Scholarships" to academically high achieving student-athletes;

o Partner with pro athletes who are active and visible in their communities for promoting scholarships, athletics or community service eg. "Stay in School", The United Way etc.

3.4 PREMIUM CONTENT STORE

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While HIGHLIGHTREEL.COM'S users and audience will return over and over to review new highlights that they have a personal connection to our user-base also loves professional and tier one college sports. They already have a long history of consuming this content in television as spectators and consider it one of the ways they would most like to spend free time.

An emerging market for premium streaming content is now taking hold along with the ability to merchandise these products on a per view or perpetual license basis. It is AOI'S intention to build a branded HIGHLIGHTREEL.COM STREAMING STORE within the site where these products are merchandised and a revenue share is paid by the content's license holder to AOI. Here are some examples:

o Sports Illustrated's "NFL Crunch Course" featuring top "hits" of the year;
o Don Cherry of Hockey Night In Canada hosts his annual "Rockem Sockem Hockey" Featuring the NHL's toughest hockey clips;
o NBA Final Series Review footage from NBA Licensing;
o HIGHLIGHTREEL.COM'S own branded compilation of "The Year's Best Highlights".

It is expected that the quantity of premium digital streaming content will increase dramatically over the next several years and AOI will aggressively seek out the best products and offer them to its users. To increase buyer interest and brand loyalty some very innovative "purchaser incentive" programs are being launched online by a host of aggressive technology companies. One in particular, NetCentives, Inc. of San Francisco, has devised a scheme allowing merchandisers to offer online buyers major airline frequent flyer points for each purchase. AOI will establish a variety of these programs to entrench HIGHLIGHTREEL.COM as a destination merchandising property.

Finally it should be noted that as the site collects submissions from users it will be in a position to build a comprehensive user database from which merchandise offerings and advertising messages can be tightly targeted. The tools to target on the Internet continue to improve allowing direct marketers to build buyer histories and preference profiles. AOI will leverage these techniques and tools at the HIGHLIGHTREEL.COM STREAMING STORE and in other merchandising efforts to be discussed later.

3.5 DATA ACQUISITION
- A STREAMING MEDIA ENCODING PARTNERSHIP

HIGHLIGHTREEL.COM is really a content channel run by its users, who populate it with entertaining content - their own highlight clips. For this reason it is imperative that AOI build a highlight submission system that is both easy to use and cost conscious, reducing barriers and allowing the largest number of potential users to play and compete. Returning to section 2.5 there is also the

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additional step of encoding original video highlights into streaming media ready for broadcast online. Submission and encoding must be executed flawlessly.

Rather than divert its attention from its core business of building entertaining content sites and channels frequented by loyal users AOI has determined that a strategic partnership with a leader and specialist is the best way to fulfill the encoding requirements of its users. Such a firm has been identified and discussions are now underway to position Seattle-based ENCODING.COM (www.encoding.com) as the AOI'S streaming media encoding supply house led by Microsoft alumnus and e-commerce visionary, Martin Tobias, ENCODING.COM was launched in September 1997 out of the belief that streaming media online was here to stay. The company has invested heavily in production equipment and throughput systems to produce the clearest, sharpest sound and pictures available. Their technologies are multi-platform both in terms of support for all original capture formats (Beta, VHS, etc.) and streaming technologies (RealNetworks' RealSystem.Microsoft's Netshow etc.).

At this time a fee structure for encoding is being developed. It is anticipated that costs will be based on a maximum of three (3) minutes of encoded streaming video at a price point of $9.95. As AOI is directing considerable traffic volume for retail encoding to Encoding.com it will keep a pre-determined percentage of each encoding fee. Further revenue potential lies in upselling users to higher bit streams which are clearer and these opportunities should increase as streaming media usage approaches critical mass on the Internet.

As part of the partnership ENCODING.COM would build a seamless interface for HIGHLIGHTREEL.COM users to submit their video clips with registration information via electronic file transfer (FTP) for required encoding prior to posting the main site index and archive. For the large number of users not capturing video with the latest digital camcorders a process of easy delivery of actual video media such as VHS tape cartridges will be offered. A registration form will be available at the site online for printing and inclusion with the submitted tape. The original master will be returned to the customer for a nominal shipping charge. To offer other submission alternatives to our users the AOI plans to leverage ENCODING.COM'S growing number of retail outlet relationships where physical drop off for tapes is possible. The company has also had initial discussions with one large retailing chain for photographic products about the potential of a partnership to accept tape submission. Chain operations like Wal-Mart, Costco etc. are excellent prospects for this kind of tie-up and it will be a priority to build a network of relationships to facilitate retail drop off.

Of course the company will accept video clips from users that have already been encoded and post them free of charge as normal. However we anticipate that the great majority of consumers/users will not possess the required equipment and software for high quality encoding for many years to come. Not to mention it's just not very easy and most consumers don't have the time to fuss with

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formats, protocols and optimization tool sets. By offering users with an easy, "one stop shop", per use cost approach that takes original video to broadcast as painlessly as possible most HIGHLIGHTREEL.COM users will opt for our encoding solution.

3.6 FUTURE MARKET DEVELOPMENT

For the purposes of this business concept we have confined HIGHLIGHTREEL.COM'S activities to the North American markets of the US and Canada, where online usage for sports entertainment is most entrenched. However this does not mean that great opportunities do not exist in other markets where online usage is at or approaching critical mass Australians and rabid about rugby and cricket, British are the same about soccer as are all European markets and the Japanese love baseball. All of these markets and many others have a variety of sports played at multiple levels from children to adults. Once HIGHLIGHTREEL.COM has is built-out and operating successfully at home we anticipate a wealth of opportunities to leverage the basic platform in a host of new, ready-to-play markets.

4. REVENUE MODEL SUMMARY

o ADVERTISING

As HIGHLIGHTREEL.COM'S usership and traffic ramps we will be in a position to offer a wide variety of standard, animated and streaming banner advertising opportunities to a diverse range of potential advertisers. Particularly good advertiser prospects are sports equipment (Foot Locker), electronics/computer (NEC Now, Sony), apparel (Gap, Levis), music (CDNow), books (Amazon.com), ticket agencies, (TicketMaster), Travel (Preview Travel) and image seekers (Coke, RayBan) etc. A standard rate card for national, regional and local targeting will be developed based on a cost per thousand basis. It is the company's intention to partner with one or more of the web media placement agencies such as DoubleClick or 24/7 to sell its advertising positions and leverage these firms large advertiser-client bases. Both have affinity marketing programs for sports, family and technology sites and channels.

All efforts to leverage the highly desirable demographics of the site will be taken while ensuring the quality of the overall presentation of the property. This will be partially achieved by integrating streaming media banner technology alongside HIGHLIGHTREEL.COM'S core streaming content. Studies show that streaming ads generally produce "click-thru" rates (the percentage of served ads actually clicked upon) twice that of standard "flat" banners. Also the ability now exists to take existing TV advertising campaigns and move them to the Internet with streaming media is here. Known as "webisodes" this ad tool will be seen much more in 1999. To make the most of this opportunity the site will joint the RealNetwork's

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"Site Partner Program" by supporting streaming ads and extending its positioning as a true streaming media proponent and advocate.

o MERCHANDISING PARTNERSHIPS

The web has become the new arena of direct marketers who have moved online now merchandising literally anything on the Internet. Sales numbers grow monthly and one only need look to brands like Amazon.com, CDNow, Cyberion Outpost and Dell to see Internet merchandising success stories. Just recently a joint study from IDC and RelevantKnowledge now predicts online purchases will explode to $54 billion by 2002 from $4.3 billion in 1997!

Why is it working? ACCESS SELECTION, IMMEDIACY AND DELIVERY. Particularly it is the medium's immediacy which is fully exploited when merchandising offers are tightly integrated with content. When Elmo Dolls can be pitched in a live chat session with Rosie O'Donnell or "Parent's Soup" baby name finder brings up special offers for price reduced cribs you have a compelling sales tool indeed and remember our "Neo-Hearthminders" ? According to Forrester Research this HIGHLIGHTREEL.COM friendly segment will grab hold of online purchasing in the next few years and push it to new heights.

Given these trends large, traditional bricks & mortar retailers like Sears and new breed players like Cyberion Outpost are both paying big dollars for prime positioning partnerships with top online traffic aggregators (eg. New York Times Online) and web portals (eg. Lycos, Yahoo), Software.net recently paid AOL $21 million to be the exclusive seller of software at the online giant through 2001 and CDNow just paid MTV Online $22.5 million for a complex three-year music retailing partnership involving TV and online promotions to name two examples.

While its market power will not compare with likes of AOL excellent opportunities exist for AOI to leverage its audience into a wide variety of multiple category merchandising partnerships where specific product offers are made to HIGHLIGHTREEL.COM users. In exchange for aggregating demand and building a compelling brand the company will structure deals that combine a monthly minimum fee and a revenue share from products sold by the merchandiser partner positioned at the site. AOI will also be able to offer its user database to extend direct product offers via e-mail pushing recipients back to HIGHLIGHTREEL.COM and its merchandiser-partner for the purchase. Product categories that come to mind immediately are sports equipment & gear (eg. Nike, Foot Locker), AV equipment (eg. Sony), music eg. CDNow, Music Blvd.), books (eg. Amazon.com, Barnes & Noble) and apparel e.g. The Gap, Levis). All active online merchandisers are looking for new sources of "eyeballs" for their online offers and HIGHLIGHTREEL.COM intends to be one of these sought after positions.

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o CORPORATE SPONSORSHIP VEHICLES

When considering HIGHLIGHTREEL.COM's user and audience segments including children, teens, parents, relatives, friends and fans there are promotional opportunities for a very wide range of companies wishing to extend their message. The company will create a range of compelling and visibility catching sponsorship vehicles allowing sponsors to build brand awareness, introduce and merchandise products and services and build an effective association with HIGHLIGHTREEL.COM's entertainment-seeking audience. Here is a brief summary of vehicles under consideration:

Award Sponsor - Annual Grand Championship or Monthly Championship positions including contribution for scholarship and/or merchandise. Example - Reebok buys a permanent position sponsoring the Grand Championship;

Content Feature Sponsor - regular feature spot for well-known property from traditional media. Example - Sport Illustrated's Weekly High School Round-up;

"Best of" Highlight Sponsor - Positions to sponsor special content features such as monthly "Top 10 Clips" or "Top Football Clip of the Year". Example - ESPN Sportszone buys a monthly position for "Top 10 Clips";

Clinic Sponsor - Positions to sponsor special multimedia streaming clinics and tutorials related to sports and athletic coaching clinics and educational sessions detailing video capture how to's, editing and the do's and don'ts of streaming media. Example - Spalding buys an annual position for basketball coaching clinics;

Merchandising Sponsor - Special feature areas will be programmed to allow merchandise partners to introduce and explain products with streaming ads and build a following at HIGHLIGHTREEL.COM. Example - JVC buys a position to host the "JVC AV Station";

HIGHLIGHTREEL.COM Streaming Store Sponsors - a number of media companies with products stocked at the store will be approached to sponsor particular content categories and features. A range of coop vehicles will also be developed. Example - NFL Films heads up the stores football section;

All vehicles will be priced based on traffic, visibility and overall promotional value.

o ENCODING FEES

As previously discussed the great majority of HIGHLIGHTREEL.COM users will not have the ability or the inclination to encode their video highlight clips for streaming online. Through ENCODING.COM the company will offer encoding service at an attractive consumer price point of $9.95 for a 3 minute clip and earn

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a revenue share for each. This is an easy to establish, volume-based revenue stream which is positioned as a requirement for participation at HIGHLIGHTREEL.COM or for any streaming vehicle on the Internet.

In the future as users become more sophisticated and skilled at video capture and demand more clarity we expect an opportunity to upsell higher quality encoding processing at higher through put bit streams.

o HIGHLIGHTREEL.COM STREAMING STORE

The company will operate a branded online storefront at the site offering premium entertainment content for streaming sold on a per use and perpetual license basis. In addition to focusing on sports content other complementary content products in multiple categories will be available including such diverse subjects such as eg. Cooking with Martha Stewart, Home Renovations with Bob Vilas etc.

o EVENT WEBCAST PRODUCTION

As the company advances its business it will actively seek out opportunities to secure digital rights for, and develop, produce and webcast, branded live sport events which will be compelling and entertaining for its audience. Under consideration are events like the Pop Warner National Football Championships.

o RECRUITMENT NETWORK PARTNERSHIPS

Due to the high number of high school students expected as Players and audience at HIGHLIGHTREEL.COM the site is an attractive demand aggregation point for online student-athlete recruitment services. The company would receive a revenue share from each new recruit signed up through the site.

o USER DATABASE LEVERAGING

As HIGHLIGHTREEL.COM'S usership and audience grows the company will own and manage a large database of highly coveted online consumers that can be utilized by a whole range of direct marketers. AOI will market this database and develop partnership programs to share in merchandise sales directed at its loyal users.

5. MARKETING & DISTRIBUTION

5.1 IMAGE & POSITIONING

AOI'S challenge will be to position HIGHLIGHTREEL.COM with the following key elements and messages:

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o "A place to bring out the star in everyone";
o "A sports channel by you for you";
o "Everyone gets a shot, and it's so easy";
o "Scholarship and Sports - a Great Partnership";
o "Families and Sports - another Great Partnership";
o "Interactive Programming is here - You select what you want".

To drive these points home the first steps is to push forward with an attention catching media launch and blitz. A suitable high tech media and press relations firm will be retained to design and execute an awareness program for the company. The program elements will include:

o Holding a press launch event with an AV presentation demonstrating HIGHLIGHTREEL.COM'S content offering;
o Distribute media kits to press contact database in media, technology, sports, publishing and general categories;
o Principals to participate in press tour to interview with selected media outlets in New York, Washington DC, Los Angeles and San Francisco;
o Participation in a selection of Internet, streaming and interactive publishing trade shows including hosting several media awareness events within them;
o To drive home the positive aspects of the site build an association through corporate sponsorship or some other means to secure a "signature anchor" affiliation(s) with a household name professional athlete who embodies the core values of AOI (eg. Troy Aikman, David Robinson, Ken Griffey Jr. etc.)

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5.2 STRATEGIC DISTRIBUTION PARTNERSHIPS

The principals have considerable experience establishing strategic partnerships for commerce and traffic generation with online leaders and will seek to build HIGHLIGHTREEL.COM'S exposure and audience through positioning the property within appropriate large media properties online.

A range of strategic partnership classes can be identified, sought and implemented by the company;

o DISTRIBUTION & TRAFFIC

The Internet "Gold Rush" or "Land Grab" is on and a whole host of traditional media organizations and youthful, Internet-bred web portals and content leaders are fighting it out to be destination "home bases" for users online now and the massive host still to come. Activity is so fierce that a whole new round of acquisitions are now in play such as Disney's recent buy-out of Infoseek. It has now become clear that the way to win or lead this battle is to offer the most compelling, entertaining and informative content, services and tools available. AOI will position HIGHLIGHTREEL.COM as a new content feature that online content leaders can simply plug into their menu of offerings. Given the site's appeal to such a wide range of ages and demographics the potential should interest a wide variety of new media players. Here are some examples:

Excite, Yahoo, Lycos, AOL, Disney/Infoseek, MSN, Snap!Online/NBC etc.

Alternatively the best possibilities may exist with well-financed new portals and properties, that may be late to the game as content players and are now moving fast to extend their brand online and catch up with their full featured programming menus. Some examples are:

Alta Vista, GeoCities, Mindspring, AT&T/TCI/@Home. USWest Internet, Go2Net, Time new Media, Washington Post Online, BellSouth.net. etc.

In the case of the telcos and cable organizations providing their subscribers access and bandwidth, such as AT&T and USWest, there are interesting opportunities to demonstrate what streaming media is, and can achieve with new high speed offerings such as cable modems and DSL. The company will seek partnerships with this group allowing it to offer an initial hosted and encoded clip as a promotion enclosed with monthly billing statements.

HIGHLIGHTREEL.COM is also a good fit with any sports category site or channel such as CBS Sportsline, ESPN Sportszone and The Sporting News and these will be explored as tie-up targets. The same can be said for family-friendly

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properties such as Net Nanny and Ziff Davis' Family PC Online due to their heavy traffic from parents and educators.

The nature of any potential tie-up would likely involve co-branding and licensing HIGHLIGHTREEL.COM'S content free of charge to the partner and sharing ad revenues generated within the partner's domain. Commerce partnership deals will also be offered to traffic partners who will be incented by receiving a 10-20% revenue share of encoding fees payable to the site. The company is also keen to establish exciting launch promotions with its partners including offering a first highlight clip with free hosting and encoding included.

A final note is that AOI/HIGHLIGHTREEL.COM may be an excellent acquisition target for a wide range of online content players looking to broaden and extent their offerings. A recent example of smallish content takeover had Go2Net offering $36 million in stock to the popular, 2-person, Silicon Investor.

o TECHNOLOGY PROMOTION

Another tie-up possibility for the company involves promoting streaming media as a new mainstream communications vehicle that is both accessible and easy to use. Both RealNetworks and Microsoft will be approached on the basis of highlighting the site as a real-world example of the power of streaming for leveraging the Internet as an entertainment medium. Both companies have launched "Site Partner Programs" and HIGHLIGHTREEL.COM will grow these associations to the greatest extent possible.

o EDUCATION & COMMUNITY PARTNERSHIPS

In keeping with the value placed on athletics as a vehicle to academic achievement the company will establish a range of affiliations that position it within the educational community and neighbourhoods everywhere. After building awareness and buy-in from this constituency the company will seek to promote itself through association with organizations such as the:

o NCAA;
o NCAA Athletic Conferences;
o National & State High School Coaches Associations;
o National and State Principals Associations;
o "Stay in School Program";
o DARE etc.

5.3 AFFILIATE PROGRAM

Many web sites and online content publishers are looking for new and exciting content to compliment their online offerings in the struggle to attract traffic and revenue. AOI will develop an affiliate program that allows independent sites to

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quickly build and activate a co-branded version of HIGHLIGHTREEL.COM for presentation at their sites at no cost or obligation. Particular attention will be given to sites devoted to streaming media development and presentation AV merchandising, and family content players like Parent's Soup. Adult pornographic sites will be excluded.

5.4 DIRECT MARKETING

To build awareness quickly and make a promotional offer to play the company will execute a highly targeted direct response campaign via traditional mail and electronic mail vehicles. This organization's target lists are suitable to convey the HIGHLIGHTREEL.COM opportunity to their constituents.

Specific databases that may be considered include:

o K-12 Schools and Athletic Departments;
o Regional representatives for Pop Warner Football, Little League Baseball, Minor Hockey;
o Community Centers;
o Cable, Telco and ISP subscribers;
o Web portals and major traffic properties;
o Online Merchandising Leaders.

5.5 ADVERTISING

The company is prepared to consider a range of paid advertising vehicles to build awareness and make promotional and special offers. Family, parenting and youth print publications are one alternative. Online advertising programs provided through media placement companies like the DoubleClick Network and 24/7 are particularly interested based on the ability to make ad buys from a range of affinity sites in specific categories like family, sports or technology. The necessity or utilizing paid advertising will be determined by the success of other visibility and distribution programs mentioned previously.

6. OPERATIONS

6.1 CORPORATE FINANCE

It is the intention of AOI to secure financing by being acquired by a listed public vehicle which may be trading on either an exchange in the US or Canada. Alternatively AOI may establish itself by listing as a small cap venture from the outset. Several corporate finance groups have expressed interest in the project and AOI is assessing proposals at this time.

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6.2 ORGANIZATION

AOI is based in Seattle, Washington and intends to further build its operations from there once corporate financing arrangements are in place. Seattle is the optimal location for AOI due to its focus on streaming media and entertainment. With leaders such as RealNetworks, Microsoft and Disney's Starwave situated locally, and its prime strategic alliance with Seattle-based Encoding.com in place, AOI will take advantage of many benefits by growing within the world's streaming media nexus. Modest, well-located premises with the latest Internet connection infrastructure will be secured for the operation.

6.3 PRINCIPALS

Both principals have requisite Internet and e-commerce experience gained in online technology ventures dating back to 1994, including management positions in marketing, business development, software and product licensing and corporate finance.

GRAHAM HEAL (37), CEO & PRESIDENT

Graham Heal has online industry experience dating back to 1994 when he was a founding member of Net Nanny Software, the well known Internet filtering tool. At that time he wore a variety of hats as Vice President, Marketing including steering marketing, sales, channel development, online commerce, licensing, strategic partner development and assisting in corporate finance and funding. He then went on to fulfill management roles at two e-commerce companies, firstly as Director, Business Development at DownloadWAREHOUSE, an innovator and leader in operating Internet stores reselling downloadable software. Most recently he was Director, business Development at online software distributor, Digital River Inc., where he was responsible for establishing key partnerships with online traffic leaders wishing to merchandise software from their sites. He has very current relationships with a variety of Internet leaders including Excite, Yahoo, Lycos, Infoseek/Disney, Alta Vista, Mecklermedia, RealNetworks, Cnet, DoubleClick, Time New Media, GTE, USWest etc.

Prior to entering the online arena Graham spent six years as a management consultant where he acted on behalf of telecommunications companies, forest product giants and firms particularly focused on trade to Asia. He also spent three years in Japan in the mid 80's where he worked in PR and trade development positions for an international brewer and the Province of British Columbia, Canada.

It will be Graham's responsibility to direct AOI'S initial development and growth while being directly involved in corporate finance, investor development and relations, marketing, PR and strategic relationship development.

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COO & GENERAL MANAGER

TBD

6.4 OTHER KEY HIRES

Both principals have strong knowledge and experience in building an online start-up company, e-commerce business development and strategic partner acquisition and licensing. From previous ventures both principals have a wide range of skilled contacts looking for new venture opportunities who they may call upon. It is expect that the following key hires will be required and can be secured locally in Seattle:

o Chief Technology Officer (Networking, Web design and database experience required);
o Director - Content/Chief Web Designer;
o Director - Marketing & Business Development;
o Office Manager (Admin, Accounting, HR, Customer Support).

6.5 CONTRACTED SERVICES

It is AOI'S objective to hold hiring down to 10 persons maximum in year one. The CEO has very recent experience directing an Internet software start-up based on the premise of minimizing in-house staff and maximizing outsourced specialists. The key benefits of this strategy is to hold down overheads and allow for fleet of foot flexibility given changing market conditions and technologies in the online industry. Too many high tech start-ups never get beyond the first 10% of their build out due to expending the majority of their funding on high salaries and office expenses. Contracted service positions will be allocated for:

o Accounting;
o Public Relations/Media Placement;
o Legal;
o Customer Service.

6.6 DIRECTORS

AOI anticipates gaining considerable Internet and e-commerce experience through the skill-sets of its directors. At this time it is expected that board members with management experience from a variety of backgrounds including companies like Microsoft, Net Nanny and Online Interactive will join the board.

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7. MAJOR COST ITEMS

An online content business requires sophisticated systems and technology to deliver product seamlessly to its audience. Many technology companies in this space allocate huge sums to build their technical infrastructure and data handling facilities. This will NOT be the course followed by AOI. Here is a summary of major cost items:

FIXED COSTS

o In-house computer systems and network;
o Office fit-out & furniture

VARIABLE COSTS

o Web site hosting and data warehousing;
o Marketing and advertising;
o Salaries & Overhead.

8. RISKS

The business as described may encounter a host of risks given the online industry changes rapidly. As the roll-out of the operation precedes the mass-market for streaming media the company is taking a leading edge approach in building its opportunity before large players are focused. Here are a few items to consider:

o Developing internet content and publishing businesses is complex;
o Acceptance by users;
o Ability to attract users, traffic and compelling content;
o Use of data/images concerning minors.

9. COMPETITION

While sport content sites are plentiful online no other property has been identified in this specific niche of sports entertainment.

10. CRITICAL KEYS TO SUCCESS

o Building a community and audience of loyal users with considerable size and scale;
o Developing key alliances to drive traffic and aggregate "eye balls";
o Ability to offer compelling and entertaining content, services and offers that are updated often;
o Selecting the best strategic partners in the online space;

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o Executing flawlessly on content acquisition and fulfillment of services, products and merchandise to our constituents and users;
o Provide superior customer service and care.

11. SECOND STAGE CONTENT CHANNELS AND BUSINESSES

HIGHLIGHTREEL.COM is the initial offering from AOI that will build a scalable platform from which other online entertainment properties can be launched. Other content categories under consideration for 2nd Stage AOI channels are jokes/comedy and independent short films. Again the company will employ a model of populating the channels with user-created content and award incentives to ensure repeat submission.

12. FINANCIALS

AOI REVENUE & EXPENSE
PROJECTIONS
Reflected as $US 000's 

SALES                                                   YR1      YR2        YR3         YR4         YR5
-----                                                   ---      ---       -----       -----       -----
Banner Ads                                              160       960       1900        3700        7200
Merchandising                                           500      3500       8200       19800       46900
Partnerships
Sponsorships                                            115       990       1960        5000       10400
Encoding ($5.00 revenue share per user)                  60       180        350         500        1100
Content Stores                                          225       850       2950        3500        7000
Event Broadcast & Sponsorships                            0       340       1190        1400        2900
                                                        ---      ----      -----       -----       -----
TOTAL SALES                                             960      6820      14650       33900       75500

Notes: Merchandising Partnership Revenue share is 15%, Content Store Margins are 40% avg. 

EXPENSES                                                YR1        YR2        YR3         YR4         YR5
--------                                                ----       ----      -----       -----       -----
Cost of Sales                                            560       3500       8200       18900       45100
Mkt, sales, Advertising                                  500       1300       1800        2400        2900
R&D/Ops                                                  300        800       1400        2400        2900
Awards/Scholarships                                      100        200        350         500        1000
General & Admin                                          300        750       1000        2100        2400
Total Expenses                                          1760       6550      12750       26300       54300
Net Income Before Taxes                                 -800        270       1900        7600       21200
Taxes                                                               120        855        3420        9540
                                                        ----       ----      -----       -----       -----
NET INCOME AFTER TAXES                                  -800        150       1045        4180       11660

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13. APPENDICES

- US Department of Commerce Study, "The Emerging Digital Economy" April 1998

- Interactive Week Article, Subject - "Encoding.com" - June 16, 1998

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SCHEDULE "B"

TECHNOLOGY SUPPORT SERVICES

1. SUPPORT SERVICES

For the monthly fee specified in paragraph 3, the Developer agrees to provide the Technology Support Services to Sensus. The Technology Support Services shall be performed during the hours of 9:00 a.m. to 5:00 p.m. in each Business Day and shall consist of the following:

1.1 Telephone assistance -- the Developer will supply telephone assistance to Sensus regarding the Technology, which telephone assistance shall include the following:

(1) explanation of functions and features of the Technology;

(2) clarification of any documentation relating to the Technology;

(3) guidance in the operation of the Technology;

(4) consultation on processing problems in connection with the Technology;

(5) correction of errors and assistance in recovering lost date under paragraph 1.1 and 1.2 of this Schedule if correction can be made by telephone, and

(6) assistance in the installation of enhancements.

1.2 Correction of program errors -- the Developer will promptly correct errors in the Technology of which it is notified, orally or in writing, by Sensus. the Developer will proceed diligently and expeditiously in correcting suspected errors. Sensus will provide particulars of the suspected errors and the circumstances in which they occur.

1.3 Assistance in recovering lost data -- If data relating to, produced by, or used in connection with the Technology is lost owing to a malfunction of hardware or software, the Developer will assist Sensus in recovering the data. This assistance will include providing advice on how to restore files from backup media, including damaged media to the extent that the data is recoverable, and on how to reconstruct date which is unrecoverable.

1.4 Enhancements -- the Developer will provide enhancements to Sensus at no extra cost. Subject to paragraph 1.1(6), Sensus will be responsible for installing the enhancements. However, the Developer shall provide to Sensus instructions that can be understood by a non-technical person on how to install the Enhancements.

1.5 Performance evaluation -- Once in each calendar year, a senior consultant of the Developer will visit Sensus for a period of four hours to evaluate the performance of the Technology and to provide general advice to Sensus.

1.6 Table and logic changes -- the Developer will forthwith provide such changes regarding existing tables and such minor logic changes to the Technology as are necessary to reflect legislative and regulatory amendments affecting the Technology (for example, variation of quantum of payroll deductions).

2

2. RESPONSE TIME

2.1 the Developer shall respond to requests for service by Sensus under paragraph 1.1, 1.2 and 1.3 no later than the second hour after the request is received. However, if a request for service is received by the Developer on a day other than a Business Day, or before 9:00 a.m. or after 5:00 p.m. on a Business Day, the Developer shall respond to the request for service no later than the later of 9:00 a.m. of the next Business Day.

2.2 For the purposes of paragraph 2.1, a request for service made by telephone to an employee of the Developer, to an answering service employed by the Developer, or to a telephone recording device used by the Developer shall be deemed to be received at the time it is made.

3. AUTHORIZED REPRESENTATIVES

Sensus shall designate in writing to the Developer three persons who will act as representatives for Sensus. Sensus may replace its representatives at any time by notice to the Developer. In general, the Developer will supply telephone assistance to Sensus under paragraph 1.1 only through Sensus' representatives.

4. ADDITIONAL SERVICES

Any consulting or development services, in addition to the Technology Support Services, provided by the Developer to Sensus, at the request of Sensus, will be provided at the best rates provided to the Developer's other customers.

Exhibit 10.2

TARGETCO ACQUISITION AGREEMENT entered into this 31st day of May, 1999.

BETWEEN:

SENSUS CAPITAL CORP. (a Nevada corporation)

(hereinafter called "Sensus")

OF THE FIRST PART

- and -

830245 ALBERTA LTD. (an Alberta Corporation)

(hereinafter called "830245")

OF THE SECOND PART

RECITALS

WHEREAS:

1. The Board of Directors of 830245 wish to encourage Sensus to make a take-over bid to the shareholders of 830245 by offering to purchase all of the outstanding Class "A" Common Voting Shares to assist in creating an enhanced liquidity for shareholders of 830245 .

2. The Board of Directors of 830245 have determined that it will recommend acceptance of the Sensus offer to the shareholders of 830245 .

3. Sensus is willing to make an offer subject to the terms and conditions of this Agreement.

NOW THEREFORE IN CONSIDERATION of the mutual covenants hereinafter set out, the parties hereby agree as follows:

-2-

ARTICLE 1
THE OFFER

1.1 THE OFFER

(a) Subject to the terms and conditions of this Agreement, Sensus agrees to mail on or about May 31, 1999, or so soon as the documentation is available to the holders of Class "A" Common Voting Shares of 830245 an offer to purchase all of the outstanding Class "A" Common Voting Shares of 830245 , by the exchange of one (1) Sensus Common Share for each issued and outstanding 830245 Class "A" Common Voting Share subject to the terms and conditions set out in the Offer marked as Schedule "A" to this Agreement (as such Offer may be amended from time to time as permitted under this Agreement). Sensus expressly reserves the right to modify the terms of the Offer except that, without the prior written consent of 830245 , Sensus shall not reduce the Offer price; change the form of consideration payable under the Offer; or add to, amend or change any of the offer terms in any manner adverse to the holders of Shares;

(b) The Offering shall expiry approximately 21 calendar days after it is commenced (or, if such date is not a business day, on the next following business day), provided that the Offer may be extended, at the sole discretion of Sensus, if the conditions thereto set forth in Schedule "A" hereto are not satisfied on the expiry day of the Offer. Subject to the satisfaction or waiver of the conditions set forth in Schedule "A" hereto, Sensus shall within the time periods required by law take up and pay for all Class "A" Common Voting Shares validly tendered (and not properly withdraw) pursuant to the Offer. Sensus shall use its reasonable commercial efforts to consummate the Offer, subject only to the terms and conditions hereof.

1.2 830245 APPROVAL OF THE OFFER

830245 represents that its Board of Directors, upon consultation with its advisors, has determined unanimously that the Board of Directors will recommend that 830245 Shareholders accept the Offer.

1.3 POST OFFER COVENANTS

If Sensus takes up and pays for Class "A" Common Voting Shares pursuant to the Offer, Sensus and 830245 agree to use all reasonable commercial efforts to enable Sensus to acquire the balance of the Class "A" Common Voting Shares as soon as practicable after completion of the Offer by way of compulsory acquisition, arrangement, amalgamation or other type of acquisition transaction

-3-

carried out for a consideration at least of equal value of the consideration paid in the Offer.

ARTICLE II
COVENANTS OF 830245

2.1 ORDINARY COURSE OF BUSINESS

830245 covenants and agrees that:

(a) 830245 shall conduct its business only, and not take any action except in, the usual, ordinary and regular course of business and consistent with past practice;

(b) 830245 shall not directly or indirectly do or permit to occur any of the following:

(i) issue, sell, pledge, lease, dispose of, encumber or agree to issue, sell, pledge, lease, dispose of or encumber:

(A) any additional shares of, or any options, warrants, calls, conversion privileges or rights of any kind to acquire any shares of, any capital stock of 830245 (other than pursuant to the exercise, or

(B) except with the usual, ordinary and regular course of business and consistent with past practice, any assets of 830245 .

ii) amend or propose to amend its articles or by-laws;

iii) split, combine or re-classify any outstanding Class "A" Common Voting Shares, or declare, set aside or pay any dividend or other distribution payable in cash, stock, property or otherwise with respect to the Class "A" Common Voting Shares;

iv) redeem, purchase or offer to purchase any Class "A" Common Voting Shares or other securities of 830245 ;

v) reorganize, amalgamate or merge 830245 with any other person, corporation, partnership or other business organization whatsoever;

vi) acquire or agree to acquire (by merger, amalgamation, acquisition of stock or assets or otherwise) any person, corporation,

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partnership, joint venture or other business organization or division or acquire or agree to acquire any material assets;

vii) except in the usual, ordinary and regular course of business and consistent with past practice, satisfy any material claims or liabilities except such as have been reserved against in 830245 's financial statements delivered to Sensus, relinquish any material contractual rights or enter into any interest rate, currency or commodity swaps, hedges or other similar financial instruments; or

viii) incur or commit to incur any indebtedness for borrowed money or issue any debt securities except for the borrowing of working capital in the ordinary course of business and consistent with past practice.

(c) 830245 shall cooperate with Sensus in structuring the acquisition by Sensus of 830245 in a tax efficient manner provided that no such cooperation shall be required where such structuring shall have any adverse effect on 830245 .

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF 830245

3.1 REPRESENTATIONS

830245 hereby represents to Sensus that the information as it relates to 830245 as set forth in Schedule "B" to this Agreement (being a draft Takeover Bid Circular dated May 31, 1999) are accurate and 830245 hereby warrants the accuracy of the representations contained therein (and acknowledge that Sensus is relying upon those representations and warranties in connection with entering into this Agreement).

3.2 INVESTIGATION

Any investigation by Sensus and its advisors shall not mitigate, diminish or affect the representations and warranties of 830245 provided pursuant to this Agreement. Where the provisions of Schedule "B" or elsewhere in this Agreement refer to disclosure in writing, such disclosure shall be made expressly in response to the applicable provision and shall be signed by a senior officer of 830245 .

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SENSUS

4.1 REPRESENTATIONS

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Sensus hereby represents and warrants to 830245 that the information as it relates to Sensus as set forth in the Circular attached as Schedule "B" to this Agreement are accurate and Sensus hereby warrants the accuracy of the representations contained therein (and acknowledges that 830245 is relying upon such representations and warranties in connection with the entering into of this Agreement).

ARTICLE V
MUTUAL COVENANTS

5.1 FURTHER ASSURANCES

Subject to the terms and conditions herein, Sensus and 830245 agree to use their respective commercially reasonable efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations, to consummate the transactions contemplated by this Agreement and the Offer. 830245 and Sensus will use their commercially reasonable efforts: (I) to obtain all necessary waivers, consents and approvals from other parties to material loan agreements, leases, and other contracts or agreements (including in particular but without limitation, the agreement of any persons as may be required pursuant to any agreement, arrangement or understanding relating to 830245 's operations); (ii) to obtain all necessary consents, approvals and authorizations as are required to be obtained under any federal, provincial or foreign law or regulations with respect to this Agreement or the Offer; (iii) to lift or rescind any injunction or restraining order or other order adversely affecting the ability of the parties to consummate the transactions contemplated hereby or by the Offer; and
(iv) to fulfil all conditions and satisfy all provisions of this Agreement and the Offer.

ARTICLE VI
TERMINATION

6.1 TERMINATION

This Agreement may be terminated at any time prior to the Effective Time:

(a) by mutual written consent of Sensus and 830245 ;

(b) by either Sensus or 830245 after June 21, 1999 if Sensus has not purchased Class "A" Common Voting Shares pursuant to the Offer;

(c) by either Sensus or 830245 , if the conditions of the Offer have not been satisfied or waived on the Expiry Date.

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In the event of the termination of this Agreement as provided in this
Section 6.1, this Agreement shall forthwith become void and there shall be no liability on the part of Sensus or 830245 .

ARTICLE VII
MISCELLANEOUS

7.1 ENTIRE AGREEMENT

This Agreement and the documents referred to herein constitute the entire agreement between the parties with respect to the subject matter hereof and supersede all prior agreements, arrangements or understandings with respect thereto.

7.2 COUNTERPARTS

This Agreement may be executed in any number of counterparts and each such counterpart shall be deemed to be an original instrument but all such counterparts together shall constitute but one Agreement.

7.3 SEVERABILITY

If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired, or invalidated and the parties shall negotiate in good faith to modify the Agreement to preserve each party's anticipated benefits under the Agreement.

7.4 CHOICE OF LAW

This Agreement shall be governed by, construed and in accordance with the laws of the Province of Alberta.

7.5 REMEDIES

The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to remedy or prevent non-compliance or breaches with the terms of this Agreement and to enforce specifically the terms and provisions hereof in any court of the Province of Alberta having jurisdiction; provided that such remedies shall be in addition to, and not in substitution for, any other remedy to which the parties may be entitled at law or in equity.

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IN WITNESS WHEREOF the parties hereto have caused this Agreement to be executed on their behalf by their officers thereunto duly authorized as of the date first above written.

SENSUS CAPITAL CORP.
(a Nevada corporation) 

PER: /s/ John M. Hall
     --------------------------
John M. Hall, President

830245 ALBERTA LTD.
(an Alberta corporation) 

PER: /s/ J. Timothy Bowes
     -------------------------
J. Timothy Bowes, President

Exhibit 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the reference to our firm under the caption "Experts" and to the use of our report dated February 20, 2000, in the Registration Statement (Form SB-2 No. 333--) and related Prospectus of Sensus Capital Corp., dated March 23, 2000 for the registration of 11,156,500 shares of its common stock. 

Calgary, Canada                                   /s/ Ernst & Young LLP
March 23, 2000                                    Chartered Accountants

Exhibit 23.2

CONSENT OF JEFFER, MANGELS, BUTLER & MARMARO, LLP

We consent to the reference to our firm and to the inclusion of our opinion as an exhibit to the Form SB-2 Registration Statement of Sensus Capital Corp., a Nevada corporation, as filed with the Securities and Exchange Commission on March 23, 2000

JEFFER, MANGELS, BUTLER & MARMARO LLP

ARTICLE 5


PERIOD TYPE 9 MOS
FISCAL YEAR END MAY 31 2000
PERIOD START MAY 27 1999
PERIOD END FEB 18 2000
CASH 83,351
SECURITIES 0
RECEIVABLES 6,000
ALLOWANCES 0
INVENTORY 0
CURRENT ASSETS 94,351
PP&E 0
DEPRECIATION 0
TOTAL ASSETS 109,524
CURRENT LIABILITIES 7,077
BONDS 0
PREFERRED MANDATORY 0
PREFERRED 0
COMMON 10,157
OTHER SE 113,401
TOTAL LIABILITY AND EQUITY 109,524
SALES 0
TOTAL REVENUES 0
CGS 0
TOTAL COSTS 0
OTHER EXPENSES 21,111
LOSS PROVISION 0
INTEREST EXPENSE 0
INCOME PRETAX (21,111)
INCOME TAX 0
INCOME CONTINUING 0
DISCONTINUED 0
EXTRAORDINARY 0
CHANGES 0
NET INCOME 0
EPS BASIC (21,111)
EPS DILUTED 0
BROKERAGE PARTNERS
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