EXHIBIT 10.3

                               OPERATING AGREEMENT

This  operating  agreement  is entered  into and becomes  this 15th day of July,
1995, and is by and between ATLANTIC PACIFIC TRUST,  hereinafter  referred to as
"ATLANTIC," and EMTEC, Inc., a Nevada  corporation,  hereinafter  referred to as
"EMTEC."

                                    RECITALS


WHEREAS, ATLANTIC owns eight (8) mineral claims and leases on three (3) patented
mining claims located on Piute Mountain,  Kern County;  and leases on the Weldon
Research Center, located in Weldon, Kern County, California.

WHEREAS, ATLANTIC wishes to employ EMTEC to do conduct all necessary work to put
the mineral properties in to full production on a turn-key basis.

WHEREAS,  EMTEC  wishes to do all the necessary  work  providing a full turn-key
mining and refining operation for ATLANTIC on a cost plus basis.

NOW  THEREFORE,  in  consideration  of mutual  covenants and promises  contained
herein the parties do hereby agree as follows:

                                   AGREEMENT

1.   ATLANTIC  will  reimburse  EMTEC for all  expenses and costs at the rate of
     cost plus 18%. An invoice must be presented to ATLANTIC on the 1st and 15th
     of each month. ATLANTIC will make payment to EMTEC within 5 days of receipt
     of invoice.  Costs shall be defined as all costs  directly  and  indirectly
     related to EMTEC  performing  its duties in the  exploration,  development,
     production and support facilities of the Evening Star Mine and other duties
     requested by ATLANTIC.

2.   EMTEC shall perform all  exploration,  development,  and  production of the
     Evening Star Mine and its ores.  EMTEC will proceed  with  developments  in
     phases.

     Phase I: Determination of ore reserves to be refined.

     Phase  II:  Develop a  working  pilot  plant of one ton per hour or more to
     determine the extraction parameters for a larger refinery.

     Phase III: The construction  and operation of a large  production  refinery
     and  development of a turn-key mining and milling  operation  including all
     support operations and facilities.

3.   EMTEC shall be the operator for all operations.  All permits will be in the
     name of EMTEC.  EMTEC will obtain all  permits  necessary  before  start of
     operations.


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4.   EMTEC will work in an environmentally safe manner. EMTEC will hold ATLANTIC
     harmless for any and all  environmental  violations,  accidents,  or deaths
     which may occur.

5.   EMTEC will carry all the  necessary  insurances  required by law, and carry
     liability  insurance of $5,000,000 for Auto, Trust, Theft and Fire on items
     built or acquired by EMTEC.

6.   EMTEC will be responsible for all security,  and guarding  against theft of
     equipment, refined precious metals, and for public safety.

7.   EMTEC will deliver to ATLANTIC all  precious  metals.  EMTEC may sell other
     base metals and mined  substances upon per written  approval from ATLANTIC.
     All  proceeds  form the sale of other  minerals or  equipment  will be paid
     directly to ATLANTIC.

8.   EMTEC will be solely  responsible  and hold harmless  ATLANTIC  against any
     hazardous  waste  discharges,  whether the  discharges are tailing from the
     refinery  operation  or by  direct  spills  of oils,  fuels,  human  waste,
     garbage,  or any substance  identified by any regulatory body as "Hazardous
     Waste."

9.   EMTEC  will  provide  all  necessary  reclamation  bonding  and  be  solely
     responsible  for all  reclamation  required by the  controlling  regulatory
     agency.

10.  EMTEC will provide total and  unrestricted  access to all books and records
     of EMTEC for  ATLANTIC  auditors  or  representatives  at any time  without
     notice.  If in the event  ATLANTIC's  auditors  discover  any abuse or over
     expensing of items ATLANTIC shall immediately deliver to EMTEC a report and
     documentation  of such abuse and over expensing  along with a demand notice
     to reconcile  the accounts and for  repayment of any  overpayments  made by
     ATLANTIC due to said abuse.  If in the event EMTEC does not immediately pay
     to ATLANTIC any overages or if EMTEC does not correct the abuse within five
     (5) days then  ATLANTIC  shall  immediately  terminate  this  Agreement and
     assume  possession of all facilities and operations and EMTEC hereby agrees
     to vacate all facilities and operations  without protest.  EMTEC will still
     be  liable  to pay to  ATLANTIC  all of the  overages  due to abuse or over
     expensing.

11.  In the  event  of a  default,  termination  of  this  Agreement,  or if any
     unforeseen  event causes a cessation  of  operation  for 60 (sixty) days or
     more,  then in such event of cessation  all  equipment,  support  building,
     machinery, nuts, bolts, office supplies and equipment, reports, permits, or
     more  particularly  any thing acquired by EMTEC during its employment  with
     ATLANTIC that ATLANTIC has reimbursed EMTEC for, will automatically, on the
     61 day after  cessation of  operation,  or sooner if agreed to,  become the
     sole and  absolute  property of  ATLANTIC.  However,  if the  cessation  of
     operations  is due to an act of God, then ATLANTIC will have the sole right
     to determine whether this Agreement is in default. If ATLANTIC does declare
     a default then it must do so in writing to EMTEC stating its declaration of
     default.


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12.  ATLANTIC  will have the right to  examine  and EMTEC  will  provide  during
     regular  business  hours,  all  books,  records,  maps,  assays,   reports,
     engineering  or otherwise or anything  else which the personnel of Atlantic
     wish to  inspect,  and  further  shall be  allowed  to make  copies  of any
     information  that  is  requested.  Failure  to do so  will  result  in  the
     termination of this Agreement.

13.  EMTEC will allow  representative  of ATLANTIC free and unhindered access to
     all operations under the management of EMTEC or its associates.  EMTEC will
     allow and  ATLANTIC  will have the  right to have a  representative  at the
     refinery 24 hours a day for added  security.  The  ATLANTIC  representative
     will have full  access to all  refining  assays,  books,  records,  and all
     mining areas.  The ATLANTIC  representative  will request from time to time
     control  assays  to be  performed  and  other  tests  and means by which to
     determine the accuracy of the recovery of the precious metals.

14.  EMTEC will turn over all  precious  metals to the  ATLANTIC  representative
     daily and the ATLANTIC  representative  will deliver to EMTEC a receipt for
     the precious metals received.

15.  In the event of a default  under this  Agreement  ATLANTIC  will deliver to
     EMTEC a written statement of default by certified United States Mail. EMTEC
     will have up to 30 days to cure said  default.  If in the event  EMTEC does
     not cure said  default  within the 30-day time  period than this  Agreement
     will  be in  default  and  the  remedies  listed  in  Section  10-  shall e
     initiated.  In the  event of an  uncured  default  EMTEC is to  vacate  all
     premises without protest.

15.  NOTICES: Any notices, communication,  request, approval or consent that may
     be given or that is required to be given under the terms of this  Agreement
     shall be in  writing,  and shall be sent  certified  mail,  return  receipt
     requested  or by  overnight  courier,  to the  address  for  each  party as
     follows:

     TO ATLANTIC:  Steven B. Mortensen,  Trustee, 4750 Kelso Creek Road, Weldon,
     CO 92383
     TO EMTEC: William M. Moreland, CEO, 4750 Kelso Creek Road, Weldon, CA 93283

16.  GOVERNING  LAW:  This  Agreement  shall  be  governed  in  its  enforcement
     construction and interpretation by the laws of State of Nevada.

17.  INVALIDITY OF  PROVISIONS:  The  unenforceability,  for any reason,  of any
     term,  condition,  covenant or provision of this  agreement  shall  neither
     limit nor impair the  operation,  enforceability  or  validity of any other
     terms, conditions,  provisions or covenants of the Agreement so long as the
     remaining provisions still fulfill the original intent of the parties.

18.  CAPTIONS:  The captions of this Agreement are for convenience and reference
     only and in no way define, describe, extent or limit the scope or intent of
     this agreement or the intent of any provisions in it.

19.  ENTIRE  AGREEMENT:  This Agreement  constitutes the entire agreement of the
     parties  and may not be amended or modified  except in a writing  signed by
     both parties. All other agreements, drafts, notes, tapes, whether verbal or
     written,  shall  have no force  or  effect  on this  Agreement.  All  prior


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<PAGE>


     understanding  and  agreements  between  the  parties  are  merged  in this
     Agreement, which alone fully and completely expresses their understanding.

20.  Successors:  This Agreement shall be binding on and inure to the benefit of
     the  parties  and  their  respective  successors,   assigned  and  personal
     representatives.

21.  Survival of Representations,  Warranties,  Et Cetera: The  representations,
     warranties, covenants, and agreements of the parties contained herein shall
     survive this Agreement.

IN WITNESS  WHEREOF,  the parties have executed this Operating  Agreement on the
date first above stated.

ATLANTIC PACIFIC TRUST                      EMTEC, INC.

/s/ Steven B. Mortensen                     /s/ William M. Moreland
-----------------------                     ------------------------
Steven B. Mortensen,                        William M. Moreland
Trustee in Trust of                         CEO of EMTEC, INC.
Atlantic Pacific Trust                       




                                                                    EXHIBIT 10.3