UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-KSB

[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended October 31, 2000

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number: 000-29663

RADIANT ENERGY CORPORATION
(Exact name of registrant as specified in its charter)

Canada N/A
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)

40 Centre Drive, Orchard Park, NY 14127
(Address of principal executive offices) (Zip Code)

Issuers telephone number (716) 662-0022

Securities registered pursuant to Section 12(g) of the Act:
Common Stock
(Title of each class)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [x]Yes [ ] No

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

State issuer's revenues for the most recent fiscal year $3,432,583

State the aggregate market value of the voting and non voting common equity held by non-
affiliates computed by reference to the price at which the common equity was sold, or the
average bid and asked  price of such  common equity as of a specified date within the past
60days:

$12,783,490 based on December 29, 2000 closing share price.

State the number of shares outstanding of each of the issuer's classes of common equity, as
of the latest practical date: 14,026,600 shares of Common Stock as of January 19, 2001.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's definitive proxy statement in the form in which it will be filed
with the Securities and Exchange Commission and used in connection with the Registrant's
annual meeting of shareholders to be held on March 29, 2001 are incorporated by reference
into Part III of this report.

Transitional Small Business Disclosure Format (check one): Yes [ _ ] No [ X]

PART I

Item 1.  Description of Business.

General

Radiant Energy Corporation ("REC") is in the business of providing its patented
INFRATEK® deicing technology and services to the commercial airline industry. It
conducts all of its operations through its wholly owned operating subsidiary Radiant
Aviation Services, Inc. ("RAS"). REC and RAS are sometimes referred to herein as the
"Company."  The Company has never generated a profit and, as a result, has accumulated
a significant deficit.

Following four years of development and three years of field tests of the INFRATEK®
technology at the Rhinelander Oneida County Airport in Wisconsin and the Greater Buffalo
International Airport in New York, the Company opened its first major commercial deicing
facility at Newark International Airport ("the Newark Facility") in New Jersey in December
1999. The Newark Facility is being operated by Continental Airlines, Inc. and revenues from
operations at the facility are being shared between the Company and Continental. On
December 20, 1999, the Newark Facility was sold to MDFC Equipment Leasing Corporation
("MDFC"), a wholly owned subsidiary of Boeing Capital Services Corporation ("Boeing
Capital") and, contemporaneously, leased to the Company.  On November 28, 2000 the
Company announced that the Board of Directors at Kalamazoo- Battle Creek International
Airport has reached an agreement to allow Radiant to install a deicing service center at the
Kalamazoo Airport.

The Company's website is "www.radiantenergycorp.com." It has ten (10) employees as of
January 19, 2001. All currency references in this document are in U.S. dollars, unless
otherwise indicated.

The INFRATEK® Technology and Deicing System

Through the controlled combustion of natural or propane gas, the Company's proprietary
heating devices melt accumulated ice and snow on aircraft. The heat energy generated by the
devices does not harm the aircraft or the passengers inside. The Company's INFRATEK®
technology combines infrared energy with a method of concentrating this energy; the
technology is proprietary, patented and approved for use by the Federal Aviation
Administration ("FAA").   In October 2000, Radiant announced that the FAA had
completed and published guidelines for selection and implementation
of an infrared deicing system. The announcement referred to the FAA including the
INFRATEK® system in an advisory circular titled Design of Aircraft Deicing Facilities. The
document provides universal guidelines for the establishment of INFRATEK® deicing facilities.

The Company's INFRATEK® system is housed in an open-ended structure. The heating
devices are suspended from an arched frame over the aircraft. To begin the deicing
process, an aircraft enters the structure and comes to a full stop. Passengers and
crew remain on board. An operator enters information related to the aircraft
into a computer.  The computer then
starts the heating devices, which produce the required amount of radiant heat energy to
melt and evaporate the snow, ice and frost from the surface of the aircraft. The process
time varies depending on the amount of snow, ice and frost on the aircraft. After the
INFRATEK® system has been utilized, and the aircraft is "clean", it may be necessary,
depending on weather conditions, to apply a chemical (glycol-based) anti-icing fluid to
prevent accumulations of snow, ice or frost.

The following table is based upon Management's industry experience and opinion. It
compares the INFRATEK® system to traditional, chemical deicing with glycol, assuming
a mid-sized aircraft (e.g., a Boeing 737) with an average covering of snow, ice and frost.

|                                   | INFRATEK®            | GLYCOL                                                
|---------------------------------- | -------------------- | ------------------------------------------------------
|Time to deice                      | 3 to 20 minutes      | 5 to 25 minutes                                       
|Gas/Glycol Quantity                | 5 to 10 million BTUs | 75 to 1,000 gallons                                   
|Cost per unit                      | $5.00/million BTU    | $9 to $15 gallon - includes cost ofglycol and recovery
|Cost/Application (excluding Labor) | $25 to $50           | $675 to $15,000                                       
|Equipment                          | INFRATEK®            | Trucks, deicingequipment, and acontainment system     
|Labor (Workers)                    | 1 to 2               | 4 to 8                                                

The INFRATEK® system's computerization enables a single operator to adjust the system
for specific aircraft and various deicing conditions. The control system is PC-based and runs
programs developed by the Company for the INFRATEK® application.

Advantages of the INFRATEK® System

Data collected from working installations demonstrate that the INFRATEK® system
offers the following advantages over the traditional chemical deicing process:

1. Operating cost savings;
2. Improved and dependable throughput timing, contributing to greater airport efficiencies;
3. Capital cost savings;
4. Environmental risks are reduced; and
5. Worker safety is improved.

Disadvantages of the INFRATEK® System

Management believes that the INFRATEK® system may have, or be perceived by the
industry to have, the following disadvantages, compared to traditional deicing:

1. The technology depends upon an electrical power source and an uninterrupted flow of natural gas; and
2. The INFRATEK® system requires more space than chemical deicing trucks,
resulting in higher real estate costs and is subject to the availability of real estate;

Commercialization of the INFRATEK® Technology

In March 1997 Prior Aviation Services, an aviation service company with extensive
experience in aircraft
deicing, commenced operation of the first commercial INFRATEK® system at the Greater
Buffalo International Airport in New York.

In January 1998 Radiant realized its first sale of an INFRATEK® system
to the Rhinelander Oneida County Airport in
Wisconsin. The Company retained no rights to this system or to the revenues
produced by it. During March 1998, the system commenced commercial operations.
The INFRATEK® system deices approximately 50% of Rhinelander Airports
air traffic, which consists primarily of commuter aircraft including Dash 8s and
Beech 1900s. To date, over 175 deicings utilizing the INFRATEK® system have
occurred at the Rhinelander Airport.

On December 20, 1999, the Company opened its first major installation of an INFRATEK®
system at Newark
International Airport. The 32,868 square foot facility was sold to MDFC, a
wholly owned subsidiary of Boeing Capital, on December 20, 1999, and,
contemporaneously, leased back to the Company. Continental has an option to
purchase the Newark Facility. Continental operates the Newark Facility and
charges airlines a per use deicing fee, which is shared with the
Company.

The Market for INFRATEK® and Plan of Marketing

The potential users of the INFRATEK® system include commercial passenger airlines, air
cargo haulers, military installations, and the general aviation industry.

The Company estimates the primary North American market of major hub, medium-sized
and regional airports to be
approximately 750 locations, with approximately an additional 750 locations in
Europe. Some of these 1,500 locations have traffic volumes, which could justify
installation of multiple INFRATEK® systems. Primary locations include those
with suitable weather patterns, as well as some warm weather locations (e.g.,
Atlanta) where icing occurs. Company owned Deicing Service Centres
(DSCs) are planned to be located in high-traffic locations to be
operated by an airline, with direct sales taking place to the airports and the
military. A DSC is an INFRATEK® system, which is either
owned or leased by the Company and operated by an airline, airport authority, or
third party.

The Company plans to generate revenues:

1. By owning or leasing DSCs at major hub locations;
2. Through direct sales to end users, with or without a per use deicing licensing fee; and
3. From maintenance agreements.

Deicing Service Centres

The Company plans to own or lease INFRATEK®  systems at the major airline hubs and
enter into management
contracts with an airline or general aviation service company to operate the
system at the airport. Revenues will be shared between the Company and the
operator of the system. The operator will be responsible for the operating
costs.

Direct Sales

The Company also plans to sell INFRATEK®  systems primarily to airports.
The Company also plans to make direct sales to the military. As a condition of these
sales, the purchaser may be assessed a royalty fee based on use.

Maintenance Contracts

The Company plans to offer maintenance services for INFRATEK® systems on
a fixed fee basis.

THE AVIATION INDUSTRY AND DEICING

The Deicing of Aircraft

The aviation services industry includes aircraft fueling, cargo warehousing and maintenance
of aircraft, ground support
equipment and aircraft deicing. The FAA currently requires that aircraft
prepared for flight must be free and clear of frozen contamination (frost, snow
and ice). This requirement, the clean aircraft concept, has been a
major factor in both the decrease in the number of ice related aircraft crashes
since 1992 and the increase in the amount of glycol used in deicing.

Although the FAA regulates the airline industry, standards for deicing are determined by the
airlines and individual
airports. The traditional and most common method of aircraft deicing consists of
spraying a mixture of hot water and the chemical glycol on the contaminated
surfaces. A substantial capital investment in traditional deicing infrastructure
has already been made by the airline industry, principally in tanker trucks
equipped with booms, training programs, and contaminant recovery, removal and disposal
facilities for used glycol.

The Environmental Issues

Environmental issues associated with glycol have prompted the Environmental Protection
Agency to protest the
increased utilization of chemical-based technologies for deicing operations.
Glycol chemicals used in deicing fluids pose health hazards to operators
including eye irritation, central nervous system depression, and kidney and
liver damage. The environmental risks have prompted increasingly tighter
procedures and techniques in the handling, use and disposal of these chemicals.
As a result, airports are developing multi-million dollar deicing fluid
recovery, containment and disposal facilities. The Companys technology
addresses these environmental and industry issues by providing a service that
reduces operating costs, environmental risks, operating risks, and health risks
by significantly reducing the need for these chemicals.

FAA Approval and Recognition

The FAA approved for use the INFRATEK®  deicing system in 1997. In June 1997, the
FAA awarded the Company its
1997 Environmental Award in recognition of the Companys efforts to develop
a more environmentally responsible method of deicing aircraft. The Company won
the 1997 Technology and Innovation Award presented by Aviation Week & Space
Technology Magazine. The editors of Discover Magazine nominated the Company for
the magazines Award for Technological Innovation. In February 1998, the
Federal Laboratory Consortium recognized the Company for its outstanding efforts
in technology transfer between industry and federal agencies.

The INFRATEK®  system has been designated by the FAA as eligible for Federal Airport
Improvement Program and Passenger Facility Charge funding. As a result, U.S. airports are
eligible to apply for funding from these programs for up to 90% of the total cost incurred to
install an INFRATEK®  system.

Environmentally Responsible Technology

Glycol used for deicing can enter streams, sewage and water supply systems serving
suburban and urban
communities, contaminating surface water and groundwater drinking systems. The
Companys technology eliminates the need for glycol chemicals used in the
removal of ice, snow and frost from aircraft surfaces.

Depending on weather conditions, a light spraying of glycol may be applied to provide anti-
icing protection. This last measure is not part of the INFRATEK®  system and is common
in the industry.

DEICING

Overview

Aircraft deicing consists of the pre-flight removal of ice, snow and frost from aircraft
surfaces. Depending on weather conditions, the application of anti-icing chemicals may be
required after the deicing process to prevent re-accumulation.

The use of deicing chemicals increased markedly in 1992 and 1993 as a result of a
commercial airliner crash,
which was suspected to be the result of improper deicing at LaGuardia Airport in
New York. In response to this incident, the FAA mandated that aircraft be free
of ice, snow and frost. Currently, aircraft deicing is primarily accomplished
through the application of chemical deicing solutions. Due to the hazardous
environmental and human safety effects of these chemicals, aircraft deicing
operations are facing increasing regulations and costs.

The Traditional Chemical Deicing Process Using Glycol

Glycol is applied to aircraft as a hot liquid most commonly in a mixture of glycol and
hot water. The hot
water melts the ice; the glycol is added to the hot water so it does not
refreeze on the aircraft. This mixture is applied under pressure using a nozzle
mounted on a vehicle. The pressure of the liquid hitting the surface of the
aircraft mechanically removes snow and ice, which is also melted by the heat of
the solution. In addition, the antifreeze properties of the compound remove snow
and ice. The solution that remains on the surface of the aircraft helps prevent
refreezing. The amount of deicing solution used on an individual aircraft can
range from 10 gallons for light frost on a small corporate jet to several
thousand gallons for a large commercial aircraft. Aircraft deicing is performed
by the airline or by a service company. Using conventional glycol sprays,
airlines currently can pay between $675 and $15,000 to deice a narrow body
passenger jet, depending on the amount of accumulation and weather
conditions.

Traditional Deicing Environmental Infrastructure

Because most airports were built before environmental regulations for polluted water runoff
were enacted, the
infrastructure needed to control large quantities of deicing fluids does not
exist at many airports. Deicing generally takes place directly on the tarmac.
Deicing chemicals may enter the runoff and flow into nearby
waterways. In 1987, under Clean Water Act revisions, storm water runoff was
recognized under federal law as a serious water pollution problem, and the
national storm water permit system was adopted to attempt to control polluted
runoff from urban areas, including industrial sites.

To minimize the potentially hazardous effects of aircraft deicing, some airports use
centralized deicing
systems, which drain into recycling tanks or large retention ponds. Other
airports collect storm water runoff through drains and treat it before
discharging it into a sanitary sewage system. In addition, many larger airports
conduct water-monitoring studies. At other airports, deicing fluid runoff flows
directly into creeks and other tributaries.

Competition

The Company faces competition primarily from two sources: (i) existing chemical deicing
methods and the related airport Ground Support Equipment ("GSE") infrastructure, and (ii)
alternative deicing methods.

Ethylene and Propylene Glycol

The current method of deicing large aircraft is to first deice the critical
aircraft surfaces using so-called Type I, Type II, or
"Type IV," ethylene or propylene glycol fluids, which are specifically
formulated for deicing applications(1). The Companys principal
competition, therefore, comes from the manufacturers of ethylene and propylene
glycol technology in combination with the GSE industry infrastructure (i.e.,
deicing trucks, special booms, related procedures and training programs, and the
substantial existing and planned contaminant removal and disposal facilities)
and the companies committed to using glycol. Glycol manufacturers and the GSE
industry infrastructure have been operating without any substantial competition
from alternative deicing methods. The inertia implicit in the long-standing
relationship between chemical-based deicing delivery systems, airports and
airlines is strong and well entrenched.

The major producers of glycol in North America include Union Carbide, Dow
Chemical, Saudi Basic Industries, Shell Oil, Occidental Petroleum, Texaco Chemical,
and BASF.

Due to the potential environmental and human safety hazards posed by ethylene glycol use,
several major U.S.
airlines, as well as the U.S. Air Force, decided in 1993 to cease utilizing
ethylene glycol for deicing. Instead, they now use propylene glycol, which has
fewer adverse environmental effects than ethylene glycol. According to one
producer, Arco Chemical Co., propylene glycol is as effective for deicing
aircraft as is ethylene glycol, and has no harmful effects on humans in this
application. However, anti-corrosion chemicals added to a propylene glycol
deicer can render the substance just as toxic to aquatic life as ethylene
glycol-based deicing fluids.

-------- (1) In many cases, so-called "Type II" fluid is then applied for anti-icing purposes to
protect the deiced aircraft
from re-accumulation of frozen contamination prior to and during takeoff. The
need to apply such anti-icing chemicals to an aircraft after deicing is not
eliminated by the utilization of the INFRATEK®  system.

GSE Operators and Alternative Deicing Methods

The GSE industry has expanded and adapted its deicing equipment, materials, and operating
standards in an effort to provide acceptable service to airline clients and comply with aviation
and environmental regulations.

The increased attention placed on icing-related aircraft crashes has resulted in an increase
in the use of deicing
chemicals. This, in turn, has caused airport operating problems in the form of
aircraft congestion and longer holdover times. Airports have attempted to
address the congestion and holdover problems in a number of ways, including the
construction of centralized remote deicing facilities removed from gate
activity.

A number of glycol spray truck manufacturers are reviewing other forms of combined glycol
and forced air, or hot forced air systems. Trials of alternative methods continue in the
industry, with none having received widespread industry acceptance.

Intellectual Property

The Company was issued Patent #5,417,389 by the U.S. Patent and Trademark Office on
May 23, 1995. The Patent was re-issued on December 28, 1999 as Patent #36468. The Patent
covers two aspects of the proprietary INFRATEK®  system:

1. Generating and focusing specific electromagnetic wavelengths of radiant energy on a target surface; and
2. Creating an increased component of radiant energy through natural or propane gas.

The Company was issued Trademark #2,072,371 for "Infratek" by the U.S. Patent and
Trademark Office on June 17, 1997.

MATERIAL CONTRACTS

The Boeing Capital Investment Agreement

On June 30, 1999, the Company entered into an agreement with Boeing Capital pursuant to
which Boeing Capital (1)
purchased 2,292,260 shares of common stock of the Company (Shares)
for $2,330,243; (2) was granted the option to purchase 653,145 Shares at a price
of Cdn. $1.35 (U.S. $0.92 at June 30, 1999) per Share; and (3) was granted the
right of first refusal to provide financing on a case by case basis to the
Company for construction of INFRATEK®  systems (the Boeing Capital
Investment Agreement). The Boeing Capital Investment Agreement, among
other things, grants Boeing Capital (1) proportionate representation on the
Companys board of directors and (2) pre-emptive rights and anti-dilution
protection to enable Boeing Capital to maintain its proportionate equity
interest in the Company should it elect to do so. In addition, Boeing Capital
and certain shareholders have entered into an agreement, which provides that
they will recommend to the board of directors that Boeing Capital be allowed to
increase its ownership to 25%. The agreement also grants to Boeing Capital the
right of first refusal with respect to all future financing of the
Companys products for the period ending on the fifth anniversary of the
listing of the Companys shares on any exchange or market in the United
States. Boeing Capitals rights under these agreements could potentially
result in a change in control of the Company.

The Boeing Capital Corporation Financing Agreement

The Company entered into an agreement with Boeing Capital Corporation and its
affiliates ("BCC") dated June 24, 1999 (the BCC Financing Agreement)
in connection with entering into the Boeing Capital
Investment Agreement. The BCC Financing Agreement provides that BCC will provide
financing for the construction of up to four (4)
INFRATEK®  systems to an aggregate of $10 million. The BCC Financing
Agreement provides that upon the construction of an INFRATEK®  system by the
Company, the Company will sell the system to BCC, which
contemporaneously will lease the system to the Company. The lease term will be
seven (7) years. The rent payable pursuant to the lease will be equal to the sum
of (i) 1.432% of the equipment cost, and (ii) 10% of the monthly deicing revenue
from such system. The Company will be responsible for maintaining insurance and
all costs associated with the systems operations. The Company will have
the option to purchase each INFRATEK®  system at fair market value, not to
exceed 37.5% of its original cost, at the expiration of the lease.

The Company sold the Newark Facility to a wholly owned subsidiary of Boeing Capital,
MDFC, on December 20, 1999
for $3,383,700; the Newark Facility cost $2,943,355 to construct.
Contemporaneously with the sale, the Company leased the Newark Facility for a
period of eight years at a monthly rental of approximately $49,000 plus 10% of
the monthly deicing revenue.

The Continental Airlines Agreement

On September 9, 1999, RAS entered into an agreement with Continental Airlines for, among other
things, RAS to build an INFRATEK®  system at a site controlled by Continental at Newark
International Airport. This installation, the Newark Facility, was completed on December 20,
1999.

The Continental Agreement provides that Continental will (1) operate the Newark Facility,
(2) pay for all operating
costs, (3) pay RAS a fee (in accordance with an approved schedule of fees) for
use of the INFRATEK®  system, and (4) share equally in all net revenues
generated for advertising sold to third parties, either on the inside or outside
of the Newark Facility. RAS is responsible for costs of all future capital
repairs.

The Continental Agreement also grants Continental the option to purchase the Newark
Facility after May 1, 2000,
and before the later of (i) May 1, 2002 or (ii) 30 days after the Newark
Facility is completed. The purchase option price ranges from $3,322,793 on May
1, 2000 to $2,815,238 on May 1, 2002. If Continental exercises the purchase
option, Continental will pay RAS $150 for each deicing treatment of a
non-Continental aircraft and $75 for each deicing treatment of a Continental
aircraft.

The Kalamazoo Agreement

On November 11, 2000 the Company signed a lease agreement  with the Board of Directors
at Kalamazoo- Battle Creek
International Airport for the installation of a deicing service centers. The
term of the lease is 7 years and will automatically renew for successive
three-year periods until such time as either party provides 30 days written
notice of termination prior to the beginning of the renewal period.

Under terms of the agreement, Radiant will own the facility and lease the land from the
Kalamazoo Airport.  Radiant will enter user agreements with the airlines operating at the
airport based on a fixed-price fee for each aircraft treated in the deicing center.

The Lufthansa Agreement

On May 10, 1999, RAS entered into a contract with Lufthansa Engineering and Operational
Services Gmbh for
Lufthansa, on a non-exclusive basis, to provide for the installation, sale,
maintenance and service of INFRATEK®  systems in Europe and Scandinavia.
Lufthansa was granted a right of first refusal, on a project by-project basis,
for the installation, maintenance and service of INFRATEK®  systems in these
areas. RAS is obligated to pay Lufthansa 10,000 D.M., (U.S. $4,837 as of June
27, 2000), per year regardless of whether sales are made. If a sale is made by
Lufthansa, RAS is obligated to pay a 5% commission on each sale. RAS has the
right to cancel the contract after December 31, 2002 if Lufthansa has not sold a
minium of two systems by that date. If not canceled, the Lufthansa contract will
automatically renew for one (1) year periods beginning December 31, 2002, unless
terminated by either party.

Distribution Agreement for Norway, Sweden, Denmark, Finland and Iceland

On March 17, 1997, the Company entered into a distribution agreement with Oakmoor
Enterprises Inc. Under the
distribution agreement, Oakmoor Enterprises was appointed the Companys
exclusive distributor of deicing systems in Norway, Sweden, Denmark, Finland and
Iceland. Oakmoor Enterprises is required to sell a minimum of five deicing
systems during the initial five-year term of the distribution agreement. The
distribution agreement is automatically renewable for a further five-year term
if the minimum sales requirement is met.

Corporate Development

REC was incorporated under the laws of Ontario, Canada on October 21, 1994 as a private
company. On February 21,
1996, it was continued as a Canadian federal corporation and amalgamated with
Northern Atlas Inc. (Northern Atlas), an inactive, publicly held
Canadian corporation. The new company continued as Radiant Energy Corporation.
REC was deemed the acquirer for accounting purposes and its assets and
liabilities were recorded at their historic values at the date of
acquisition.

Pursuant to the amalgamation, shareholders of Northern Atlas received one (1) share in the
amalgamated company for
every four (4) shares held of Northern Atlas; REC shareholders received two (2)
shares in the amalgamated company (now REC) for each share held in their
company. The amalgamation was approved by the shareholders of both companies.
Immediately after the amalgamation, there were 6,461,837 common shares
(Shares) of REC outstanding, approximately 96% of which were issued
to the shareholders of REC prior to the amalgamation.

-------- (3) At June 27, 2000, one (1) Deutsche Mark (D.M.) equaled $.4837. (Source: Wall
Street Journal.)

REC has one subsidiary, RAS, a New York corporation, incorporated on November 5, 1992,
through which it conducts all of its operations. RAS changed its name from Process
Technologies, Inc. effective March 29, 1999.

Enforceability of Certain Civil Liabilities

The enforcement by investors of civil liabilities under the United States federal securities
laws may be adversely
affected by the fact that REC is organized under the laws of Canada, and that
some of RECs officers and directors are neither citizens nor residents of
the United States. There can be no assurance that (1) RECs U.S.
shareholders will be able to effect service of process within the United States
upon such persons, (2) RECs U.S. shareholders will be able to enforce, in
United States courts, judgments against such persons obtained in such courts
predicated upon the civil liability provisions of United States federal
securities laws, (3) appropriate foreign courts would enforce judgments of
United States courts obtained in actions against such persons predicated upon
the civil liability provisions of the federal securities laws, and (4) the
appropriate foreign courts would enforce, in original actions, liabilities
against such persons predicated solely upon the United States federal securities
laws.

Risk Factors and Investment Considerations

Investment in the Company's Shares is speculative and subject to many substantial risks.

1.   Dependence Upon Relationships With Boeing Capital and Continental. The
Company is dependent upon working relationships it has established, and agreements it
has entered into, with Boeing Capital and Continental. These relationships and
agreements have provided the Company with investment capital, operating
expertise and marketing assistance. The Company would be adversely and
materially affected in the event that either of these companies fails to perform
its obligations under its respective agreements or the agreements are cancelled,
or the respective relationships deteriorate.

2.   The Company's Marketing Plan may need to be modified. As a relatively young
company introducing a new technology, the Company will be regularly monitoring and
reviewing its marketing plan in order to make appropriate modifications to it
based upon feedback from the market. The Company presently plans to market its technology by (a) operating DSCs in
conjunction with airline industry partners, and (b) selling deicing systems.
There can be no assurance that this marketing plan will be effective or that
management will be able to formulate an alternative marketing plan which will be
effective. If the Company is unable to execute its current marketing plan or
modify it, if necessary, the Company will be materially and adversely affected.

3.   Resistance of Airline Industry to the Company's Technology. There may be
substantial resistance by the airline industry to the adoption of the Companys
INFRATEK®  technology. Such resistance could be caused by any one or more of
the following factors: (a) uncertainty of effectiveness, safety and cost of the
INFRATEK®  system, (b) additional capital expenditures required to implement
INFRATEK®  deicing technology, (c) concerns about general liability issues
respecting INFRATEK®  deicing technology, (d) substantial existing investments
in traditional chemical deicing infrastructure and methods, and (e) substantial
investment in glycol containment systems, which will continue to be required
(for anti-icing) with the INFRATEK®  system. If the Company is unable to
successfully overcome any such resistance, the Company will be materially and
adversely affected.

4.   Environmental Issues and Liabilities. Although the Company's INFRATEK®
deicing system does not use hazardous chemicals for deicing, hazardous deicing chemicals
are regularly used after the INFRATEK®  system to prevent new ice build-up.
Accordingly, the Companys operations could be affected by environmental
issues and liabilities encountered by the traditional chemical deicing industry.
Some of these issues involve (a) worker safety, (b) protection of the
environment, (c) construction of facilities to collect, contain and dispose of
the chemicals, and (d) compliance with governmental regulations. The failure of
the Company to effectively address and resolve such issues as they are
anticipated or arise could have a material, adverse affect on the business.

5.   Substantial Lease Obligations. The Company presently has substantial lease
obligations to an affiliate of Boeing Capital, and minimal revenues from operations. If the
Company is unable to satisfy its lease obligations, the Company will be
materially and adversely affected.

6.   The Company's Business is Dependent Upon the Weather. Demand for deicing
services only exists when weather conditions of frost, freezing rain, sleet and snow are
present. Accordingly, the Companys business is cyclical, being linked to
the seasons and weather patterns. Since the Companys initial market focus
is North America, management believes that the peak demand for its services will
be approximately six (6) months long from approximately November 1 - April 30. If North America
experiences unseasonably mild weather, there will be reduced demand for deicing
in general and reduced demand for the Companys INFRATEK®  system, in
particular. Mild weather would have a materially adverse affect on the Company.

7.   Sufficiency of Liability Insurance. The Company presently has $100,000,000 in
general liability coverage. In addition, Continental maintains general liability
coverage of $100,000,000, which only covers the Company with respect to
operations with Continental. There can be no assurance that these insurance
policies are adequate for the Companys operations or that they will be
maintained. If claims are made against the Company for losses allegedly incurred
as a result of the Companys technology or operations and insurance
coverage is not in effect or adequate, the Company would be materially and
adversely affected.

8.   Additional Technical Development of the INFRATEK®  Technology may be
required. The Company is considering making certain modifications to the INFRATEK®
system in order to increase its efficiency and lower operating costs. Presently,
the most important change being considered by management involves the
integration of a system of air blowers into the process which would remove
accumulated, loose snow prior to applying the infrared energy from the
Companys heating devices. There can be no assurance that the Company will
be able to develop and integrate an air blower system into the INFRATEK®
system that will increase the system efficiency or result in reduced operating
costs, or that any other desirable or necessary modifications can be made cost
effectively, or at all. In any of these events, the Company could be materially
and adversely affected.

9.   Additional Financing Requirements and Access to Capital. The Company has
incurred recurring losses and has an accumulated deficit in the amount of $9,550,605 as
at October 31, 2000. During the year ended October 31, 2000, the Companys
working capital decreased from $2,314,955 to $888,580, primarily as a result of
continuing operating losses that were partially offset by financing activities.
Management expects that cash on hand and funds from operations will be
sufficient to meet reasonably foreseeable working capital expenditures, capital
expenditures, rental requirements and operating requirements until approximately
February 15, 2001. There is no assurance that anticipated levels of revenues and
expenses will prove to be accurate. As at December 31, 2000, the Company had
past due payables in the amount of approximately $378,000. The Company expects
that its trade payables deficiencies will not significantly impact its
operations in the period to February 15, 2001. The Company expects that if it is
unable to secure additional financing by February 15, 2001, there will be a
material negative impact on its operations. Based on the Companys low
sales and revenues to date, it currently anticipates that it will need to raise
substantial additional funds in order to continue to develop its business.

10.   New Business; Continued Dependence on Securing Additional Financing;
Shareholder Dilution. The Company is subject to all of the risks attendant to young
business ventures including, without limitation, raising capital, acquiring or
developing complementary services or technologies which can be marketed as
intended, entering into strategic relationships with other companies, obtaining necessary
personnel, establishing and/or penetrating markets for such services, and
achieving profitable operations, of which there can be no assurance. Investors
should not purchase any Shares unless they are prepared, and can afford, to lose
their entire investment.

11.   As a young business having low sales and revenues, management anticipates that the
Company will be dependent over the foreseeable future upon securing additional
financing, of which there can be no assurance. In order to obtain additional
financing, if available, it is likely that the Company will sell additional
Shares or financial instruments, which are exchangeable or convertible into
Shares, resulting in substantial dilution to all shareholders. In order to
provide incentives to current employees and offer attractive compensation
packages to prospective employees and consultants, the Company intends to
continue to offer and issue options to purchase Shares and/or rights,
exchangeable or convertible into Shares; the exercise of such options and/or
conversion of such other exchangeable or convertible rights into Shares could
result in substantial dilution to all shareholders.

12.   Competitive Disadvantage of Company. The Company operates in a highly
competitive environment, and against other corporations, many of which have substantially
greater financial, marketing and other material resources. These other
companies, with substantial capital investment and financial stakes in
traditional chemical deicing methods, have a strong incentive to vigorously
compete with the Company in order to maintain market control and dominance.
Accordingly, the Company is at a substantial competitive disadvantage with
respect to these other companies.

13.   Dependence Upon and Retention of Key Personnel. The Company is heavily
dependent upon its senior management team. The continued availability of this team will be
a major contributing factor to the Companys future growth. If any member
of senior management becomes unavailable for any reason, the Company would be
materially and adversely affected. The Company does not maintain executive life
insurance on any member of its senior management team.  The Companys ability to achieve its revenue and operating performance
objectives will depend on its ability to attract and retain qualified and highly
skilled sales, consulting, marketing and management personnel. It vies for all
of its personnel with other companies, where competition for such personnel is
intense and is expected to remain so for the foreseeable future. Failure to
retain and expand its key employees could adversely affect the Companys
business and operating results.

14.   Volatility of Stock Price and Absence of Dividends. The market price of the Shares
has been and is likely to be highly volatile. Factors such as a termination of
strategic alliances, announcements of technological innovations by others or new
services offered by the Company or its competitors, governmental regulatory
actions, developments concerning proprietary rights of the Company or its
competitors (including litigation), period-to-period fluctuations in the
Companys operating results, changes in estimates of the Companys
performance by securities analysts, and other factors not within the control of
the Company, could have a significant adverse
impact on the market price of the Shares. The Company has never paid cash
dividends on its Shares and does not anticipate paying any cash dividends in the
foreseeable future.

14.   Limited Trading Market. The Shares trade in Canada with bid and ask price quotes
on the Canadian Venture Exchange. There can be no assurance that an active public
market will exist at any time or can be sustained. Making a market involves
maintaining bid and ask quotations for the Shares and being available as
principal to effect transactions in reasonable quantities at those quoted
prices, subject to various securities laws and other regulatory requirements. A
public trading market having the desired characteristics of depth, liquidity and
orderliness depends upon the presence in the marketplace of willing buyers and
sellers of the Shares at any given time, which presence is dependent upon the
individual decisions of investors over which the Company has no control.
Accordingly, an investor may be unable to sell his or her Shares when he or she
wishes to do so, if at all.

Item 2. Description of Property.

The Company leases its
6,000 square foot corporate offices in Orchard Park, New York. The lease payment
is $44,000 per year; the lease expires May 15, 2001. Management believes that
its leased facilities are adequate and well suited to its current operations.
Additional office space will be required if the Company expands operations in
Orchard Park.

The Company leases the
Newark Facility (which houses the Companys first major commercial
installation of an INFRATEK®  system) from MDFC, an affiliate of Boeing
Capital. The lease term is for seven years and expires in December 2006; the
monthly rental is approximately $49,000 plus ten (10%) percent of the monthly
deicing revenue. The facility is adequately maintained and suitable for
its operations as a deicing service centre. The Company owns the
INFRATEK® deicing system at the Buffalo Niagara International Airport. The
facilitys primary purpose is to demonstrate the deicing system to
prospective purchasers. A limited amount of commercial deicing services is
provided through an operating arrangement with Prior Aviation. Prior Aviation
operates the system on behalf of the Company under a revenue sharing
arrangement. The facility is adequately maintained and suitable for its
designated purpose.

Item 3. Legal Proceedings.

None.

Item 4.  Submission of Matters to a Vote of the Security Holders.

None.

PART II

Item 5.  Market for Common Equity and Related Stockholder Matters.

(a) Market Information

Prior to October 2, 2000
Shares were traded on the Canadian Dealing Network, Inc. (CDN) under
the symbol MELT. Commencing October 2, 2000, Shares were traded on
the Canadian Venture Exchange (CDNX) under the symbol
YRD.

The high and low sales
prices for the fiscal quarters during the years ended October 31, 1999 and 2000
and during the first quarter of the current fiscal year to December 31, 2000 as
reported by the Canadian Dealer Network and the Canadian Venture Exchange, in
Canadian dollars were as follows:

|         | 1999low | 1999high | 2000low | 2000high | 2001low | 2001high
|-------- | ------- | -------- | ------- | -------- | ------- | --------
|1st Qtr. | $1.10   | $2.10    | $2.80   | $9.00    | $1.50   | $4.25   
|2nd Qtr. | 1.10    | 1.70     | 4.60    | 9.125   
|3rd Qtr. | 1.70    | 4.10     | 3.05    | 5.75    
|4th Qtr. | 2.60    | 4.65     | 3.40    | 4.75    

Canadian Dealer Network and Canadian Venture Exchange quotations represent inter-dealer
prices, without mark-ups, commissions, etc., and they may not necessarily be indicative of
actual sales prices.

(b) Holders

At December 31, 2000, there were 237 shareholders of record.

(c) Dividends

No dividends have been declared.

The following chart sets
forth the securities sold by the Company during the quarter ended October 31,
2000 without registration of the sales under the Securities Act of 1933.

The options exercised by
Boeing Capital Corporation were issued to it in a privately negotiated
transaction with a single accredited investor.

|Date            | Number and Classof Securities Sold               | Method of Sale                                           | Securities ActExemption
|--------------- | ------------------------------------------------ | -------------------------------------------------------- | -----------------------
|August 18, 2000 | 92,080 Commonshares at $.92 (Cdn$1.35 per share) | Exercise of options byBoeing Capital ServicesCorporation | Section 4 (2)          

Item 6. Managements Discussion and Analysis or Plan of Operation.

FORWARD LOOKING STATEMENTS.

This Managements
Discussion and Analysis of Financial Condition and Results of Operations
contains forward-looking statements. For this purpose, any statements that are
not statements relating to historical facts may be considered forward-looking
statements. Without limiting the foregoing, the words believes,
anticipates, plans, expects, and similar
expressions are intended to identify forward-looking statements. In addition,
forward looking statements include, but are not limited to, statements regarding
future financing needs, future revenues, future profitability and factors
affecting future liquidity. A number of important factors could cause the
Companys actual results to differ materially from those indicated in the
forward-looking statements in this discussion. Reference is made to the
information under the heading Risk Factors and Investment
Considerations under Item 1. Description of Business contained
in this report, which information is incorporated herein by reference. The
forward-looking statements contained in this discussion represent the
Companys judgment based on information currently available to it.

The following discussions
and analysis presents a review of the consolidated operating results and
financial condition of Radiant Energy Corporation (the Company) and
its subsidiary Radiant Aviation Services, Inc. (RAS) for the years
ended October 31, 2000 and 1999. This discussion and analysis should be read in
conjunction with the Consolidated Financial Statements and Notes thereto
contained in Item 7 of this Report.

DISCUSSION OF FINANCIAL CONDITION CHANGES DURING THE YEAR ENDED OCTOBER 31, 2000

All dollar amounts referred
to in the following discussion are based on the October 31, 2000 Canadian dollar
exchange rate of $1.5225 per U.S. dollar where applicable.

LIQUIDITY AND CAPITAL RESOURCES

During the year ended
October 31, 2000, the Companys working capital decreased from $2,314,955
to $888,580 and cash and term deposits decreased from $1,981,232 to $1,092,080
primarily as a result of continuing operating losses that were partially offset
by financing activities.

Working capital decreased
by $1,426,375 during the year to $888,580 as at October 31, 2000. Significant
changes in components of the Companys working capital during the year
ended October 31, 2000 included
the decrease of cash and term deposits, deposits and prepaid expenses and
accounts payable and accrued liabilities. During the year ended October 31,
2000, deposits and prepaid expenses decreased by approximately $1,009,000, from
$1,203,316 to $194,022. Deposit and prepaid expenses at October 31, 1999
included deposits with suppliers and other expenditures, in the amount of
$1,152,248, related to the installation INFRATEK® 2000 System at the Newark
International Airport, the installation of which was in process as at October
31, 1999. Deposits and prepaid expenses associated with the installation of
Systems were nil as at October 31, 2000 as a result of the completion of the
INFRATEK® 2000 System at the Newark International Airport and without the
commencement of any new installations.

During the year ended October 31, 2000, accounts payable and accrued liabilities decreased by
approximately $379,000, from $815,021 to $435,731. The decrease in accounts
payable and accrued liabilities relates primarily to amounts payable as at
October 31, 1999 associated with the installation INFRATEK®  2000 System at
the Newark International Airport.

Cash and term deposits decreased $889,152 during the year ended October 31, 2000, from $1,981,232 to
$1,092,080 as a October 31, 2000, primarily as a result of continuing operating
losses that were partially offset by items not affecting cash, changes in
non-cash working capital items related to operating activities, and financing
activities. As presented in the Consolidated Statement of Cash Flows, cash used
in operating activities increased to $2,265,765 during the year ended October
31, 2000 from $1,746,811 during the prior year. Cash used in operations was
partially offset by $1,419,882 provided by financing activities during the
fiscal year.

Management anticipates that as a result of the Companys low sales and revenues to date, that the
Company will need to raise substantial additional funds in order to continue to
develop its business. The Company will need to secure additional financing in
order to fund cash used in operations, its continuing operations, working
capital, capital expenditures and rental requirements. Cash as at January 19,
2001 has decreased to approximately $292,500 from $1,092,080 as at October 31,
2000. Management expects current cash on hand and funds from operations will be
sufficient to meet reasonably foreseeable working capital expenditures, capital
expenditures, rental requirements and operating requirements until approximately
February 15, 2001. There is no assurance that anticipated levels of revenues and
expenses will prove to be accurate. Accordingly, the annual audited Consolidated
Financial Statements for the year ended October 31, 2000 and October 31, 1999
included the following disclosure in Report of the Independent Auditors:

|The accompanying consolidated financial statements have been prepared assuming that
the company will continue as a going concern. As discussed in note 1 to
the consolidated financial statements, the company has suffered recurring losses
from operations and has an accumulated deficit. These conditions raise
substantial doubt about the companys ability to continue as a going
concern. Managements plans in regard to these matters are also described
in note 1 . The consolidated financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In addition, Note 1 of the Notes to the Consolidated Financial Statements included the
following:

|The consolidated financial statements have been prepared by management in accordance
with accounting principles generally accepted in the United States on a going
concern basis, which contemplates the realization of assets and the discharge of
liabilities in the normal course of business for the foreseeable future. The
company has incurred significant losses and negative cash flow from operations
in each of the last two years and has an accumulated deficit of $9,550,605 at
October 31, 2000 [1999 - $6,198,895]. The companys ability to continue as
a going concern is in substantial doubt and is dependent upon achieving a
profitable level of operations and obtaining additional financing. Management of
the company has undertaken steps as part of a plan to raise additional capital.
To improve operations, management intends to continue to focus sales and
marketing on specific markets and customers. There can be no assurance the
company can attain profitable operations in the future. These consolidated
financial statements do not give effect to any adjustments which would be
necessary should the company be unable to continue as a going concern and
therefore, be required to realize its assets and discharge its liabilities in
other than the normal course of business and at amounts different from those
reflected in the accompanying consolidated financial statements.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The amount of additional financing that the Company will be required to obtain to fund cash used in
operations, its continuing operations, working capital, capital expenditures and
rental requirements during the year ending October 31, 2001 is dependent on the
actual levels of revenues and expenses during the year. Although the Company
anticipates that it will achieve increased sales during the year ended October
31, 2001, if the Company is unsuccessful in achieving additional sales, it is
anticipated that the company will require additional financing, of approximately
$4,500,000 to fund cash used in operations, its continuing operations, working
capital, capital expenditures and rental requirements during the year ending
October 31, 2001. There is no assurance that anticipated levels of revenues and
expenses will prove to be accurate.

As a result of the deficiency in short term liquidity and capital resources the Company has not
been able to make timely payments to certain of its trade and other creditors.
As at December 31, 2000, the Company had past due payables in the amount of
approximately $378,000. The Company expects that its trade payable deficiencies
will not significantly impact its operations during the period to February 15,
2001. The Company expects that if it is unable to secure additional financing by
February 15, 2001, there will be a material, negative impact on its operations.

The Company is currently in discussions with a number of potential investors in order to secure the
additional financing required. Financing may not be available or may not be
available on acceptable terms. Any financing obtained by the Company is likely
to involve sales of common stock or other instruments that are exchangeable or
convertible into common stock, resulting in substantial dilution to
shareholders. If the Company is successful in obtaining additional financing in
an amount less than the amount sought, and if anticipated levels of sales and
expenses do not prove to be accurate, the Company may be required modify the
planned development of the business or secure further additional financing. If
the Companys current discussions with potential investors to secure
additional financing are not finalized by February 15, 2001, the Company intends
to attempt to secure short term financing from directors
and other significant shareholders. Additional short term financing may not be
available or may not be available on acceptable terms, in which case the Company
may be required to curtail operations in order to continue operations on a
limited basis.

The Companys plans for continuing operations and development of its business include the
establishment of deicing service centres financed through the sale-leaseback
transactions. The Company currently has a sale-leaseback financing facility
agreement with BCC, whereby BCC will enter
sale-leaseback transactions with the Company to an aggregate of $10,000,000
subject to certain conditions, including placement of the equipment into service
not later than December 31, 2001, and approval by BCC of each draw on the lease line.
Plans for continuing operations and development of the Companys
business require that the agreement with BCC be extended beyond December 31, 2001
and that the aggregate limit contained in the agreement be substantially
increased, or that the Company secure additional financing similar to that
provided by BCC, with other lenders.

During the year ended
October 31, 2000, the Company issued common stock as a result of conversion of
its 7% convertible subordinated debentures, exercises of incentive stock options
by employees, directors and consultants, and exercise of stock options by Boeing
Capital Services Corporation. In summary, capital stock was changed by these
transactions as follows:

`Number           Stated
                                                                 of Shares        Capital
                                                                 #                $
Outstanding at October 31, 1999                                 12,027,934        8,721,039
-------------------------------------------------------------------------------------------
Issued upon conversion of 7% debentures - net of costs             951,932          682,146
Issued upon conversion of stock options                            494,625          586,425
Issued upon conversion of stock options granted to financial        44,450           55,934
advisors
Issued upon conversion of stock options granted to Boeing Capital  507,659          465,470
Services Corporation
Services Corporation
-------------------------------------------------------------------------------------------
                                                                1,998,666         1,789,975
-------------------------------------------------------------------------------------------
Outstanding at October 31, 2000                                14,026,600        10,511,014
-------------------------------------------------------------------------------------------`

After giving effect to these transactions, there were the following options outstanding as of
October 31, 2000:

- Incentive stock options exercisable for 1,424,181 shares at prices ranging from
$0.76 to $3.94 and total potential gross proceeds of $2,776,566; and
- Boeing options to purchase 145,486 shares at $0.88 per share and total potential
gross proceeds of $129,002.

RESULTS OF OPERATIONS

During the year ended
October 31, 2000, the Company installed an INFRATEK® System 2000 at the Newark
International Airport. On December 20, 1999, the system was turned over to the
operator, Continental Airlines, Inc. (Continental) to commence
training and to start the process of system integration into their de-icing
operations. By the end of January, having treated over 20 aircraft, the training
and integration phase was substantially completed. Integrated operations began
on February 3, 2000. By April 30, 2000, Continental had treated over 60 aircraft
at the facility. Between November 14, 2000 and January 23, 2001 an additional
170 treatments were completed. Based on Managements estimates and
discussions with Continental, it is estimated that Continental realized savings
versus the cost of alternative glycol treatments in excess of $350,000 to date
during the current year.

REVENUE

For the year ended October 31, 2000 revenues, operating expenses and costs of sales related
to revenues were as follows:

`Deicing
                                                               Service
                                               System          Centre       Maintenance
                                               Sales         Operations       Services         Total
                                                  $               $               $              $
----------------------------------------------------------------------------------------------------

REVENUE
Sales                                        3,383,700          25,367        23,516       3,432,583
----------------------------------------------------------------------------------------------------
Operating expenses exclusive of
    depreciation and amortization
         Installation cost                   2,943,355               -             -       2,943,355
         Other operating expenses                    -          11,790         4,473          16,263
----------------------------------------------------------------------------------------------------
Gross profit                                   440,345          13,577        19,043         472,965
Deferred profit on sale-leaseback             (440,345)              -             -        (440,345)
Deicing service center rent expense                  -        (448,505)            -        (448,505)
----------------------------------------------------------------------------------------------------
                                                     -        (434,928)       19,043        (415,885)
----------------------------------------------------------------------------------------------------`

During the year ended
October 31, 2000, RAS received $3,383,700 from the sale of the INFRATEK®
2000 System installed at Newark International Airport to MDFC Equipment
Leasing Corporation (MDFC). Costs associated with the installation
of the deicing service center were $2,943,355 resulting in a gross profit of
$440,345. RAS entered into an agreement to lease the facility back from MDFC.
The lease provides for monthly rental payments of approximately
$49,000 per month for eighty-four months commencing January 20, 2000 in arrears
plus 10% of deicing revenues. The Newark Facility was placed in operation on
December 20, 1999 and generated $25,367 in revenue during the year ended October
31, 2000. The Company also received $23,516 in maintenance revenue primarily
associated with the INFRATEK® system at Rhinelander Airport in Wisconsin. The
Companys sales and revenues during the year ended October 31, 1999 were
$5,500.

DEFERRED PROFIT ON SALE-LEASEBACK

Profits on the
sale-leaseback of assets are deferred and amortized to income over the terms of
the leases as a reduction in rental expenses. During the year ended October 31,
2000, profit in the amount of $440,345, representing the profit on the sale of
the System installed at the Newark International Airport which was sold to MDFC
and leased back, was deferred. Deferred profit on sale-leaseback were $nil
during the year ended October 31, 1999. Amounts deferred during the year ended
October 31, 2000 are amortized to income as a reduction in rental expenses at a
rate of $5,242 per month over the term of the eighty-four month lease.

DEICING SERVICE CENTRE RENT EXPENSE

Deicing service center rent
expenses associated with the System installed at the Newark International
Airport was $448,505 during the year ended October 31, 2000 and $nil during the
prior year. Rent expense represents the aggregate of payments and accruals to
MDFC for gross lease payments, in the amount of approximately $49,000 per month,
plus 10% of deicing revenue, less the amortization of deferred profit on
sale-leaseback in the amount of $5,242, as follows.

`2000            1999
                                                            $               $
--------------------------------------------------------------------------------
DEICING SERVICE CENTRE RENT EXPENSE
Gross lease payments                                      499,596              -
Revenue participation, 10% of deicing revenue               2,529              -
--------------------------------------------------------------------------------
                                                          502,125              -
Amortization of deferred profit on sale-leaseback         (53,620)             -
--------------------------------------------------------------------------------
                                                          448,505              -
--------------------------------------------------------------------------------`

INTEREST INCOME

Interest income during the
year was $127,239, compared to $37,471 in 1999. The Company received interest
income on its daily cash balances and from low risk term deposits.

MARKETING EXPENSES

During the year, the
Company continued to expand its marketing efforts. Marketing expenses during the
year ended October 31, 2000 were $1,013,644 compared to $433,192 in 1999. As at
October 31, 1999 the complement of sales personnel consisted of two sales people
while the current complement includes seven sales persons and consultants. In
addition, expenditures on general market activities including advertising,
promotional material, travel and trade shows increased during the year ended
October 31, 2000.

GENERAL AND ADMINISTRATIVE EXPENSES

General and administrative
expenses during the year ended October 31, 2000 increased to $1,214,713 from
$618,412 in 1999. Staffing levels remained constant between 2000 and 1999. The
Company incurred higher legal and accounting expenses related to the
registration of its Shares under the Securities Exchange Act of 1934. During the
year ended October 31, 2000, the Company incurred additional administrative
expenses for consulting fees in connection with the Boeing financing, for
consulting fees related to investor relations and for executive search costs
related to the recruitment of senior executives.

WRITE-DOWN OF FIXED ASSET

During the year ended October 31, 2000, the Company wrote down, to its net realizable value, its
investment in the deicing service center located at the Buffalo-Niagara
International Airport. The company recorded a charge in the amount of $371,494
resulting in a recorded net realizable value of $100,000 as at October 31, 2000.
There were no charges similar charges recorded during the prior year.

RESEARCH AND PRODUCT DEVELOPMENT COSTS

For the fiscal year ended
October 31, 2000 research and development costs increased to $306,744 from
$189,410 during 1999. The increase in research and development costs in the
current period resulted from the engagement of an independent aviation
consultant to conduct comparative tests of the INFRATEK® treatment with
conventional deicing methods with respect to refreezing on aerodynamically quiet
areas of aircraft wings and increased engineering personnel. The Company also
continued research on optional equipment that could be incorporated into the
system.

DEPRECIATION AND AMORTIZATION

Depreciation and
amortization for the year ended October 31, 2000 increased to $151,266 from
$128,843 in 1999. The increase primarily resulted from depreciation associated
with capital assets acquired during the years ended October 31, 1999 and 2000.

INTEREST EXPENSE

Interest expense for the
year ended October 31, 2000 decreased to $5,210 from $40,606 in 1999. Interest
expense in 1999 related to the 6% debentures, which were converted to common
shares during October 1999, the 9% secured loan that was retired in May 1999 and
the 7% debentures issued during May 1999, which were converted to common shares
by July 31, 2000 of the current fiscal year.

EARNINGS PER SHARE

Following information concerns the computation of earnings per share data for the years
ended October 31, 2000 and October 31, 1999.

`Per Share        Earnings
                                                                  Numerator        Denominator       Per Share
---------------------------------------------------------- ----------------  ----------------- ---------------

Year ended
October 31, 2000

Loss for the year                                              $(3,351,710)

Basic earnings per share, income available to common           $(3,351,710)         13,304,761         $(0.25)
shareholders

Year ended October 31, 1999
Loss for the year                                              $(1,371,556)

Basic earnings per share, income available to common           $(1,371,556)          9,368,142         $(0.15)
shareholders`

At October 31, 2000 options for the purchase of 1,424,181 shares were outstanding. At October 31,
1999 options to purchase 1,827,478 shares were outstanding. In addition, at
October 31, 1999 the Company had 7% secured convertible debentures outstanding
that were convertible to 1,952,149 shares. Diluted earnings per share for the
years ended October 31, 2000 and 1999 have not be presented as the shares to be
issued on the exercise of options and on conversion the of convertible
debentures would have an anti-dilutive impact as a result of losses being
reported for these periods.

Item 7.  Financial Statements.

Consolidated Financial Statements

Radiant Energy Corporation
Years ended October 31, 2000 and 1999
With Report of Independent Auditors

REPORT OF INDEPENDENT AUDITORS

To the Shareholders  of Radiant Energy Corporation

We have audited the
accompanying consolidated balance sheets of Radiant Energy Corporation as
at October 31, 2000 and 1999 and the related consolidated statements of loss and
deficit, shareholders equity and cash flows for the years then ended.
These financial statements are the responsibility of the companys
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in
accordance with auditing standards generally accepted in the United States.
Those standards require that we plan and perform an audit to obtain reasonable
assurance 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
consolidated financial statements referred to above, present fairly, in all
material respects, the consolidated financial position of Radiant Energy
Corporation as at October 31, 2000 and 1999 and the consolidated results of
its operations and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States.

The accompanying
consolidated financial statements have been prepared assuming that the company
will continue as a going concern. As discussed in note 1 to the
consolidated financial statements, the company has suffered recurring losses
from operations and has an accumulated deficit. These conditions raise
substantial doubt about the companys ability to continue as a going
concern. Managements plans in regard to these matters are also described
in note 1. The consolidated financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

|Hamilton, Canada,December 22, 2000. | s/ Ernst & Young LLP
Chartered Accountants
|----------------------------------- | ------------------------------------------

Radiant Energy Corporation
Amalgamated under the laws of Canada

CONSOLIDATED BALANCE SHEETS
[Prepared in accordance with accounting principles generally
accepted in the United States and in U.S. dollars]

`As at October 31                                         2000               1999
                                                           $                  $
--------------------------------------------------------------------------------


ASSETS
Current
Cash and term deposits                              1,092,080          1,981,232
Accounts receivable                                     4,072                 --
Inventory                                             95,0371              3,912
Deposits and prepaid expenses                         194,022          1,203,316
--------------------------------------------------------------------------------
Total current assets                                1,385,211          3,198,460
--------------------------------------------------------------------------------
Deferred charges                                           --             67,809
Patents                                               329,924            357,634
Fixed assets [note 2]                                 196,763            663,336
--------------------------------------------------------------------------------
                                                    1,911,898          4,287,239
--------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current

Accounts payable and accrued liabilities              435,731            815,021
Current portion of long-term debt [note 3]             60,900             68,484
--------------------------------------------------------------------------------
Total current liabilities                             496,631            883,505
--------------------------------------------------------------------------------
Deferred income taxes                                   4,402              4,402
Deferred profit [note 2]                              386,725                 --
Long-term debt [note 3]                                58,351            871,808

Shareholders' equity
Share capital [note 4]                             10,511,014          8,721,039
Accumulated other comprehensive income                  5,380              5,380
Deficit                                            (9,550,605)        (6,198,895)
--------------------------------------------------------------------------------
Total shareholders' equity                            965,789          2,527,524
--------------------------------------------------------------------------------
                                                    1,911,898          4,287,239
--------------------------------------------------------------------------------`

See accompanying notes

On behalf of the Board:

|/s Timothy P. SeelDirector | s/ Gregory G. O'HaraDirector
|-------------------------- | ----------------------------

CONSOLIDATED STATEMENTS OF LOSS AND DEFICIT
[Prepared in accordance with accounting principles generally
accepted in the United States and in U.S. dollars]

`Years ended October 31
                                                         2000               1999
                                                           $                  $
--------------------------------------------------------------------------------
Revenue
Sales                                               3,432,583              5,500
Operating expenses, exclusive of depreciation
     and amortization shown separately below        2,959,618              4,064
--------------------------------------------------------------------------------
Gross profit                                          472,965              1,436
Deferred profit on sale-leaseback [note 2]           (440,345)                --
Deicing service centre rent expense                  (448,505)                --
--------------------------------------------------------------------------------
                                                     (415,885)             1,436
Interest income                                       127,239             37,471
--------------------------------------------------------------------------------
                                                     (288,646)            38,907
--------------------------------------------------------------------------------

Expenses
Marketing                                           1,013,644            433,192
General and administrative                          1,214,706            618,412
Write-down of fixed asset [note 2]                    371,494                 --
Research and product development                      306,744            189,410
Depreciation                                          118,104             95,969
Amortization                                           33,162             32,874
Interest                                                5,210             40,606
--------------------------------------------------------------------------------
                                                    3,063,064          1,410,463
--------------------------------------------------------------------------------
Loss for year                                      (3,351,710)        (1,371,556)

Deficit, beginning of year                         (6,198,895)        (4,827,339)
--------------------------------------------------------------------------------
Deficit, end of year                               (9,550,605)        (6,198,895)
--------------------------------------------------------------------------------

Loss per common share                                   (0.25)             (0.15)
--------------------------------------------------------------------------------`

See accompanying notes

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
[Prepared in accordance with accounting principles generally
accepted in the United States and in U.S. dollars]

Years ended October 31

`Accumulated other
                                       Common    Comprehensive     comprehensive    Retained
                                        stock       income            income        earnings       Total
                                         $            $                 $               $            $
----------------------------------------------------------------------------------------------------------
Balance, October 31, 1998              5,243,320          --            9,922      (4,827,339)     425,903
----------------------------------------------------------------------------------------------------------
Net loss                                      --   (1,371,556)             --      (1,371,556)  (1,371,556)
Foreign currency
    translation, net of tax                   --       (4,542)         (4,542)             --       (4,542)
Comprehensive income                          --   (1,376,098)             --              --           --
Proceeds on issue of shares [note 4]   3,477,719           --              --              --    3,477,719 
----------------------------------------------------------------------------------------------------------
Balance, October 31, 1999              8,721,039                        5,380      (6,198,895)   2,527,524
----------------------------------------------------------------------------------------------------------
Net loss                                      --   (3,351,710)             --      (3,351,710)  (3,351,710)
Comprehensive income                          --   (3,351,710)             --              --           --
Proceeds on issue of shares [note 4]   1,789,975           --              --              --    1,789,975
----------------------------------------------------------------------------------------------------------
Balance, October 31, 2000             10,511,014           --           5,380      (9,550,605)     965,789
----------------------------------------------------------------------------------------------------------`

See accompanying notes

CONSOLIDATED STATEMENTS OF CASH FLOWS
[Prepared in accordance with accounting principles generally
accepted in the United States and in U.S. dollars]

`Years ended October 31

                                                         2000               1999
                                                           $                  $
--------------------------------------------------------------------------------
OPERATING ACTIVITIES
Loss for year                                      (3,351,710)        (1,371,556)
Add (deduct) item not affecting cash
     Write-down of fixed asset                        371,494                 --
     Depreciation and amortization                    151,266            128,837
     Other non-cash items                              19,450                 --
     Deferred taxes                                        --             (3,716)
     Gain on disposal of fixed assets                    (947)                --
--------------------------------------------------------------------------------
                                                   (2,810,447)        (1,246,435)
Net change in non-cash working capital items
relating to operating activities
     Accounts receivable                               (4,072)            30,912
     Inventory                                        (81,125)               665
     Deposits and prepaid expenses                  1,008,837         (1,157,440)
     Accounts payable and accrued liabilities        (378,958)           625,487
--------------------------------------------------------------------------------
Cash used in operating activities                  (2,265,765)        (1,746,811)
--------------------------------------------------------------------------------
INVESTING ACTIVITY
Purchase of fixed assets                              (41,528)           (63,101)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
FINANCING ACTIVITIES
Issuance (repayment) of long-term debt                (74,665)         1,361,765
Increase in deferred charges                               --           (112,709)
Deferred profit on sale-leaseback                     386,725                 --
Issuance of common shares                           1,107,822          2,574,135
--------------------------------------------------------------------------------
Cash provided by financing activities               1,419,882          3,823,191
--------------------------------------------------------------------------------

Effect of exchange rate changes on cash
and cash equivalents                                   (1,741)           (27,469)
--------------------------------------------------------------------------------
Net increase (decrease) in cash and term deposits    (889,152)         1,985,810
Cash (overdraft) and term deposits, beginning of
     year                                           1,981,232             (4,578)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash and term deposits, end of year                 1,092,080          1,981,232
--------------------------------------------------------------------------------
NON-CASH FINANCING ACTIVITY
--------------------------------------------------------------------------------
Conversion of debentures                             (744,510)          (960,315)
Conversion of deferred financing charges               62,357             56,731
--------------------------------------------------------------------------------
Issuance of common shares                             682,153            903,584
--------------------------------------------------------------------------------

Supplementary information
Cash interest paid                                     28,765             21,702
Cash taxes paid                                        20,381                659
--------------------------------------------------------------------------------`

See accompanying notes

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of operations

Radiant Energy Corporation
is a company incorporated primarily to provide services in the aviation industry
through the development and marketing of its InfraTek radiant energy deicing
technology. The consolidated financial statements have been prepared by
management in accordance with accounting principles generally accepted in the
United States on a going concern basis, which contemplates the realization of
assets and the discharge of liabilities in the normal course of business for the
foreseeable future. The company has incurred significant losses and negative
cash flow from operations in each of the last two years and has an accumulated
deficit of $9,550,605 at October 31, 2000 [1999 - $6,198,895]. The
companys ability to continue as a going concern is in substantial doubt
and is dependent upon achieving a profitable level of operations and obtaining
additional financing. Management of the company has undertaken steps as part of
a plan to raise additional capital. To improve operations, management intends to
continue to focus sales and marketing on specific markets and customers. There
can be no assurance the company can attain profitable operations in the future.
These consolidated financial statements do not give effect to any adjustments
which would be necessary should the company be unable to continue as a going
concern and therefore, be required to realize its assets and discharge its
liabilities in other than the normal course of business and at amounts different
from those reflected in the accompanying consolidated financial statements.

Basis of presentation

The consolidated financial
statements have been prepared in United States dollars and in accordance with
accounting principles generally accepted in the United States and include
certain estimates based on managements judgments. These estimates affect
the reported amounts of assets and liabilities at the date of the consolidated
financial statements and the reported amount of revenues and expenses during the
year. Actual results may differ from those estimates.

The company has  historically  measured and  presented  its financial  statements  in Canadian  dollars.  Effective
November 1, 1999, as a result of the  company's  increased  economic  activity in the U.S. as  demonstrated  by its
increasingly  high level of marketing  effort in the U.S. and significance of U.S.  dollars  denominated  assets to
the  company's  operations,  the U.S.  dollar has become  the  functional  currency  of the  company's  operations.
Effective the same date, the U.S. dollar has been adopted as the reporting currency.

For periods up to and
including October 31, 1999, the assets and liabilities of the company
denominated in a currency other than the Canadian dollar were translated into
Canadian dollars using the exchange rate in effect at the period end for
monetary items and at exchange rates prevailing at the transaction dates for
non-monetary items. Revenues and expenses were translated at the average rate
during the period with the exception of depreciation and amortization, which
were translated at historical exchange rates. Any resulting gains or losses were
included in income. The Canadian dollar consolidated financial statements so
derived have been restated into U.S. dollars by translating assets and
liabilities at a rate in effect at the balance sheet date and revenues and
expenses at the average rate for the year. Any resulting foreign exchange gains
or losses are recorded in accumulated other comprehensive income (loss).

For periods subsequent to
October 31, 1999, the unit of measure of the companys operations is the
U.S. dollar. The companys Canadian assets and liabilities have been
translated into U.S. dollars using the exchange rate in effect at the period end
for monetary items and at exchange rates prevailing at the transaction dates for
non-monetary items. Revenues and expenses are translated at the average rate for
the year. Any resulting gains or losses are recorded in income in the current
year.

Principles of consolidation

These  consolidated  financial  statements  include the  accounts of the company and its  wholly-owned  subsidiary,
Radiant Aviation Services, Inc. ["RAS"]. All significant inter-company transactions have been eliminated.

Cash and cash equivalents

Cash and cash  equivalents  include cash on deposit and term deposits with remaining  maturities of less than three
months at acquisition.

Inventory

Inventory is recorded at
the lower of actual cost and estimated net realizable value.

Deferred charges

The costs associated with
obtaining debt financing are capitalized and amortized on a straight-line basis
over the life of the debt [5 years].

Patents

The costs associated with
obtaining patents are capitalized and amortized on a straight-line basis over
the life of the patent [17 years].

Revenue recognition

Revenue from the sale of
products is recognized at the time the title transfers. Revenue from the sale of
services is recognized upon completion of the service provided.

Profits on sale-leaseback of assets

Profits on sale-leaseback
of assets are deferred and amortized to income over the terms of the leases as a
reduction in rental expense.

Loss per share

The calculation of loss per
common share is based on the reported net loss divided by the weighted average
number of shares outstanding during the year. The weighted average number of
common shares outstanding for the year ended October 31, 2000 was 13,304,761
[October 31,  1999 - 9,368,142].

Stock based compensation

The company has an
incentive stock option plan as more fully described in note 4. Any
consideration paid on the exercise of stock options is credited to share
capital.

Fixed assets

Fixed assets are carried at
cost less accumulated depreciation. Depreciation is provided on a straight-line
basis at rates estimated to amortize the cost of the assets over their estimated
useful lives based on the following rates:

|Automobiles                    | 5 years 
|------------------------------ | --------
|Office furniture and equipment | 5 years 
|Laboratory equipment           | 5 years 
|Leasehold improvements         | 5 years 
|Deicing service centers        | 10 years

Financial instruments

The carrying amount of cash
and term deposits, accounts receivable, accounts payable and accrued liabilities
are considered to be representative of their respective fair values due to their
short-term to maturity. The fair value of the companys long-term debt
based on current rates for debt with similar terms and maturities, is not
materially different from its carrying value.

The company has no derivative
financial instruments or any financial instruments that potentially subject the
company to concentrations of credit risk.

Income taxes

The company follows the
liability method of accounting for income taxes. Under this method, future
income taxes reflect the net tax effects of temporary differences between the
carrying amounts of assets and liabilities for financial reporting purposes and
the use for income tax purposes.

2.  FIXED ASSETS

`2000
                                   ---------------------------------------------
                                                                           Net
                                                      Accumulated          book
                                          Cost        depreciation         value
                                            $              $                 $
--------------------------------------------------------------------------------

Automobiles                              33,952          9,618            24,334
Office furniture and equipment          161,999        105,229            56,770
Laboratory equipment                     26,453         16,373            10,080
Leasehold improvements                   31,222         25,643             5,579
Deicing service centers                 673,486        573,486           100,000
--------------------------------------------------------------------------------
                                        927,112        730,349           196,763
--------------------------------------------------------------------------------`

During the year, the
company wrote down, to its net realizable value, its investment in the deicing
service center at the Buffalo-Niagara International Airport. Accordingly, a
charge of $371,494 has been reported in the consolidated statement of loss and
deficit.

During the year the company
sold its Newark Facility to a wholly-owned subsidiary of Boeing Capital, MDFC
for a profit of $440,345. Contemporanously with the sale, the company leased the
Facility for a period of seven years at a monthly rental of approximately
$49,000 plus 10% of the monthly deicing revenue. The profit has been deferred in
the accounts and is being amortized to income over the term of the lease.

`1999
                                   ---------------------------------------------
                                                                           Net
                                                      Accumulated          book
                                          Cost        depreciation         value
                                            $              $                 $
--------------------------------------------------------------------------------

Automobiles                              63,182          9,167            54,015
Office furniture and equipment          131,461         77,259            54,202
Laboratory equipment                     17,568         14,571             2,997
Leasehold improvements                   31,222         17,889            13,333
Deicing service centers                 673,486        134,697           538,789
--------------------------------------------------------------------------------
                                        916,919        253,583           663,336
--------------------------------------------------------------------------------`

3. LONG-TERM DEBT

`2000               1999
                                                           $                  $
--------------------------------------------------------------------------------
7% convertible secured debentures, due May 31, 2004       --             744,510
Other - unsecured                                    100,000             150,000
Vehicle loan repayable in monthly
     blended payments of principal
     and interest of $943 bearing
     interest at 2.9% to July 31, 2002                 19,251             45,782
--------------------------------------------------------------------------------
                                                      119,251            940,292
Less current portion                                   60,900             68,484
--------------------------------------------------------------------------------
                                                       58,351            871,808
--------------------------------------------------------------------------------
Minimum principal payments over the next 2 years are as follows:
                                                                             $
--------------------------------------------------------------------------------
2001                                                                      60,900
2002                                                                      58,351`

7% convertible secured debentures, due May 31, 2004

The convertible secured
debentures were convertible in minimum denominations of $100 [Canadian] at a
basic conversion price of $1.15 [Canadian] per share prior to May 31, 2000 and
$1.45 [Canadian] per share, thereafter. The company had the right after giving
30 days notice to redeem the debentures in whole or in part should the market
price of the shares equal or exceed $2.50 [Canadian] per share. Redemption was
not permitted prior to May 31, 2000.

All outstanding 7%
convertible debentures totaling $744,510 were converted, under the terms of the
debenture issue, to 951,932 common shares.

4. SHARE CAPITAL

[a] Shares

Authorized

Unlimited number of common shares

Issued and outstanding

`Number of          Stated
                                                                              shares             capital
                                                                              #                  $
----------------------------------------------------------------------------------------------------------

Outstanding at October 31, 1998                                               8,105,657          5,243,320
Issued upon conversion of 6% debentures - net of costs                          161,920            131,360
Issued upon conversion of 7% debentures - net of costs                          690,284            486,170
Issued upon settlement of 9% loans                                              366,647            286,054
Issued upon conversion of stock options                                          54,500             48,123
Issued upon conversion of options granted to financial advisors                  80,000             74,354
Issued to officer for cash                                                      276,666            227,946
Issued to Boeing Capital Services Corporation - net of costs                  2,292,260          2,223,712
----------------------------------------------------------------------------------------------------------
Outstanding at October 31,  1999                                             12,027,934          8,721,039
----------------------------------------------------------------------------------------------------------
Issued upon conversion of 7% debentures - net of costs                          951,932            682,153
Issued upon conversion of stock options                                         494,625            586,425
Issued upon conversion of options granted to financial advisors                  44,450             55,927
Issued upon conversion of options granted to Boeing Capital
Services Corporation                                                            507,659            465,470
----------------------------------------------------------------------------------------------------------
Outstanding at October 31, 2000                                              14,026,600         10,511,014
----------------------------------------------------------------------------------------------------------`

6% convertible secured debentures, formerly due May 22, 2002

On August 18, 1999, the
company called the debentures for redemption on September 24, 1999. All
outstanding 6% convertible debentures totaling $105,116 were converted on the
basis of $1.25 per share [Canadian] to 161,920 common shares.

Under the terms of the
debenture issue, the company granted, as compensation to the agents, the option
to purchase up to $113,400 [Canadian] of debentures at any time on or before May
22, 1999. On May 13, 1999, the agents exercised the option to purchase the
remaining $70,100 [Canadian] debentures and subsequently converted the
debentures to common shares. A total of 56,080 common shares were issued.

9% secured loans

On May 8, 1999, accumulated
interest and additional loans provided by directors of the company totaling
$741,939 [Canadian] were retired. In settlement of the loans, the company
provided cash of $320,295 [Canadian] and issued 366,647 common shares.

[b] Stock options

|[i] | The company has a stock
option plan whereby directors, officers, and employees and consultants, subject
to certain conditions, may be granted options to purchase up to 15% of the
outstanding common shares of the company at the closing price of the common
shares at the date when the option is granted on any stock exchange on which the
common shares may be listed. At October 31, 2000, the maximum stock options
available to be granted were 825,295.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The company applies APB Opinion 25 in accounting for its employee stock options.

The exercise price of all
stock options, granted under this plan, is equal to the market price of the
stock at the time of granting. No compensation cost has been recognized in the
financial statements for its employee stock options and compensation to
consultants is amortized over the vesting period.

For purposes of the pro-forma
disclosures, the estimated fair value of all options is amortized to expense
over their vesting period. The companys pro-forma net loss would be
increased by [$1,278,084] for the year ended October 31, 2000. The
companys pro-forma loss per share would be [$.35] for the year ended
October 31, 2000.

For purposes of meeting
requirements of FASB Statement No. 123, the fair value was estimated at the date
of grant using a Black-Scholes option pricing model with the following
weighted-average assumptions for 2000 and 1999, respectively; risk-free interest
rates of 5.75%, 7.5%, dividend yields of 0%, 0%, volatility factors of the
expected market price of the companys common stock of 133.4%, 161.4%, and
weighted average expected life per option of 5 years.

The Black-Scholes option
pricing model was developed for use in estimating the fair value of traded
options which have no vesting restrictions and are fully transferable. In
addition, option pricing models require the input of highly subjective
assumptions including the expected stock price volatility. Because the company
s employee stock options have characteristics significantly different from
those of traded options, and because changes in the subjective input assumptions
can materially affect the fair value estimate, in managements opinion, the
existing models do not necessarily provide a reliable single measure of the fair
value of its employee stock options.

A summary of the
companys stock option and warrant activity and related information is as
follows:

`2000                  1999
                                                            $                   $
--------------------------------------------------------------------------------------------------
                                                        [Canadian]              [Canadian]

                                                        Weighted                Weighted
                                                        -average                -average
                                                        exercise price          exercise price

Options
Outstanding, beginning of year                     1,827,478       1.81        728,958       1.79
Granted                                              643,437       4.80      1,228,520       1.78
Exercised                                         (1,046,734)     (1.55)      (130,000)    ( 1.38)
--------------------------------------------------------------------------------------------------
Outstanding and exercisable, end of year           1,424,181       3.11      1,827,478       1.81
--------------------------------------------------------------------------------------------------

Warrants
Outstanding, beginning of period                          --         --      4,472,271       2.00
Expired                                                   --         --     (4,472,271)     (2.00)
--------------------------------------------------------------------------------------------------
                                                          --         --             --         --
--------------------------------------------------------------------------------------------------
Total options and warrants, end of  year           1,424,181       3.11      1,827,478       1.81
--------------------------------------------------------------------------------------------------
Weighted - average fair value
   of options granted during the year                643,437       3.48      1,228,520       1.60
--------------------------------------------------------------------------------------------------`

The following table summarizes information about options outstanding as  at October 31, 2000:

`Options Outstanding
                                        Weighted-average          Weighted-
Range of                Number             remaining              average
Exercise prices       outstanding       contractual life         exercise price
--------------------------------------------------------------------------------
                                                                     [Canadian]
$1.15 - $2.50           725,744             2.9 years                $1.72
$2.51 - $4.50           165,000             4.4 years                $4.09
$4.51 - $6.00           533,437             4.7 years                $4.89`

|[ii] | On June 30, 1999, the
company completed a private placement for 2,292,260 common shares with Boeing
Capital Services Corporation [BCSC]. Under the terms of the private
placement, the company offered to BCSC, the option to purchase up to 653,145
common shares for $1.35 [Canadian] per share. The options are exercisable at a
rate equal to 25% of the common shares to be issued by the company pursuant to
the exercise of options or through the conversion of securities to common shares
that existed on June 30, 1999 [existing options and conversions].
The options may be exercised between January 1, 2000 and June 30, 2004 within 30
days of the calendar quarter end for existing options and
conversions exercised in the previous quarter. If the BCSC does not
exercise their options within the 30-day period, the options expire. During the
year BCSC exercised 507,659 options. At October 31, 2000, 145,486 options
remained outstanding.
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5. INCOME TAX

The significant components of the company's deferred tax liabilities and assets are as follows:

`2000                1999
                                                       $                  $
--------------------------------------------------------------------------------

Deferred tax assets
Income tax losses available for carryforward       3,587,000          2,680,000
Less valuation allowance                          (3,587,000)        (2,680,000)
--------------------------------------------------------------------------------
Net deferred tax assets                                   --                 --
--------------------------------------------------------------------------------
Deferred tax liabilities
Temporary differences comprehensive income             4,402              4,402
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------`

At October 31, 2000,  the company has Canadian non-capital losses of approximately $1,042,000 and U.S. net
operating losses of approximately $7,674,000.  These losses may be carried forward to reduce taxable income in
future years.

If not utilized, the Canadian losses will expire as follows:

|     | $      
|---- | -------
|     |        
|2002 | 178,000
|2003 | 27,000 
|2005 | 230,000
|2006 | 196,000
|2007 | 411,000

If not utilized, the U.S. losses will expire as follows:

|     | $        
|---- | ---------
|     |          
|2009 | 2,000    
|2010 | 622,000  
|2011 | 1,123,000
|2012 | 1,178,000
|2013 | 1,686,000
|2014 | 937,000  
|2015 | 2,126,000

The potential income tax
benefits relating to these accumulated losses have not been recorded in the
companys accounts.

6. PENSION PLAN

The company sponsors a
defined contribution, non-qualified, 401K plan, which covers all employees.
Participates may contribute a percentage of their annual compensation, subject
to certain limitations. The company matches employee contributes to a maximum of
1% of the employees compensation. Pension expense reported for the year
ended October 31, 2000 was $3,254 [1999 - Nil].

7. COMMITMENTS

Rental expense for the
years ended October 31, 2000 and 1999 amounted to $490,430 and $43,725,
respectively. The company has entered into leases with minimum lease payments
over the next 5 years as follows:

|     | $      
|---- | -------
|     |        
|2001 | 610,000
|2002 | 589,000
|2003 | 589,000
|2004 | 589,000
|2005 | 589,000

8. SEGMENTED INFORMATION

The companys only
reportable operating segment is aircraft deicing sales and service. All revenue
is derived from its U.S. operations, which also includes all fixed and other
assets.

9. RELATED PARTY TRANSACTIONS

The company was engaged in
the following related party transactions with Boeing Capital Corporation, a
shareholder.

|             | 2000$     | 1999$
|------------ | --------- | -----
|             |           |      
|Sales        | 3,383,700 | --   
|Rent expense | 448,505   | --   

10. RECENTLY ISSUED PRONOUNCEMENTS

Under Staff Accounting
Bulletin 74, the company is required to disclose certain information related to
new accounting standards which have not yet been adopted due to delayed
effective dates.

FASB Statement No. 133

Accounting for
Derivative Instruments and Hedging Activities, as amended by FASB
Statements No 137 and 138, is effective for fiscal periods beginning after
June 15, 2000. The company has not yet completed its review of the impact
of this pronouncement.

Staff Accounting Bulletin 101 [SAB 101"].

Revenue Recognition
in Financial Statements, is effective no later than the fourth quarter of
fiscal years beginning after December 15, 1999. SAB 101 summarizes certain views
in applying United States GAAP to revenue recognition in financial statements.
The impact of the application of SAB 101 is currently being reviewed by the
company.

PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance WithSection 16(a)
of the Exchange Act.

The information in response
to this Item is incorporated herein by reference to the information under the
captions "Election of Directors," Executive Officers," and "Section 16 Beneficial
Ownership Reporting" presented in Companys definitive proxy
statement filed or to be filed under Regulation 14A and used in connection with
the Companys 2001 annual meeting of shareholders to be held on March 29,
2001.

Item 10. Executive Compensation.

The information in response
to this Item is incorporated herein by reference to the information under the
captions "Summary Compensation Table," "Option/SAR Grants in Last Fiscal Year,"
"Aggregated Option/SAR Exercises in the Last Fiscal Year and Year-End Option SAR Values,"
"Executive Employment Contracts," and "Compensation of Directors" presented in
Companys definitive proxy
statement filed or to be filed under Regulation 14A and used in connection with
the Companys 2001 annual meeting of shareholders to be held on March 29,
2001.

Item 11.  Security Ownership of Certain Beneficial Owners and Management.

The information in response
to this Item is incorporated herein by reference to the information under the
caption "Voting Shares and Principal shareholders" presented in Companys definitive proxy
statement filed or to be filed under Regulation 14A and used in connection with
the Companys 2001 annual meeting of shareholders to be held on March 29,
2001.

Item 12.  Certain Relationships and Related Transactions.

The information in response to this Item is incorporated herein by reference
to the information under the caption "Certain Relationships and Related Transactions" presented in the
Companys definitive proxy statement filed or to be filed under Regulation
14A and used in connection with the Companys 2001 annual meeting of
shareholders to be held on March 29, 2001.

Item 13. Exhibits and Reports.

(a)     
Exhibits.     The following exhibits are filed as part of this report.

`Exhibit     Description

             3(a)    Articles of Incorporation dated October 21, 1994; Articles
                     of Amendment dated October 5, 1995.  (1)

             3(b)    Certificate of Amalgamation dated February 21, 1996;
                     Certificate of Continuance dated February 21, 1996. (1)

             3(c)    Certificate of Amendment of Articles of Amalgamation, dated
                     May 24, 2000.(2)

             3(d)    By-laws. (1)

             4(a)    Trust Indenture dated as of May 28, 1999 among and between
                     Radiant Energy Corporation, Radiant Aviation Services, Inc.
                     and the Trust Company of Bank of Montreal respecting 7%
                     Debentures. (1)

             4(b)    Agreement dated June 30, 1999 among and between Boeing Capital
                     Services Corporation, Charles John Chew and others
                     (the Shareholders Agreement).(1)

             10(a)   Agreement dated June 30, 1999 between Company and Boeing
                     Capital Services Corporation ("BCC Investment
                     Agreement").  (1)

             10(b)   Agreement dated June 24, 1999 between Radiant Aviation Services,
                     Inc. and Boeing Capital Corporation ("Boeing Capital Financing
                     Agreement"). (1)

             10(c)   Agreement dated September 9, 1999 between Radiant Aviation
                     Services, Inc. and Continental Airlines Inc. (the "Continental
                     Agreement"). (1)

             10(d)   Agreement dated May 10, 1999 between Company and Lufthansa
                     Engineering and Operational Services GMBH (the
                     Lufthansa Agreement).(1)

             10(e)   Agreement between Company and C. John Chew dated October 30,
                     1998.(1)

             10(f)   Agreement between Company and Timothy P. Seel dated
                     November 1, 1999.(1)*

             10(g)   Agreement between Company and Robert D. Maier dated
                     November 30, 1998. (1)*

             10(h)   Agreement between Company and Colin V.F. Digout dated
                     February 2,1999.(1)*

             10(i)   Agreement between Company and Timothy P. Seel dated
                     July 31, 1998 (the "Loan Agreement"). (1)*

             10(j)   Lease Agreement dated December 20, 1999 between Radiant
                     Aviation Services, Inc. and MDFC Equipment Leasing
                     Corporation. (1)

             10(k)   Company Stock Option Plan, as amended April 3, 1998. (1)*

             10(l)   Patent Royalty Agreement between Messrs. Chew and Seel and
                     the Company dated January 29, 1995.  (1)

             10(m)   Agreement between Company and Oakmoor Enterprises Inc.
                     dated March 17, 1997. (3)

             10(n)   Agreement dated November 2000 between Radiant Aviation
                     Services, Inc. and The County of Kalamazoo.
                     (the "Kalamazoo Agreement"). Filed herewith, Page 44.

             10(o)   Agreement between Company and Bruce Nobles dated
                     October 26, 2000. Filed herewith, Page 59.

             23      Consent of Accountants.  Page 72.*
_________
*  Indicates management compensatory plan or agreement.

   (1)    Filed as an exhibit to the Registrant's report on Form 10-SB on
          February 24, 2000, and incorporated herein by reference.

   (2)    Filed as an exhibit to the Registrants quarterly report on
          Form 10-QSB for the period ended April 30, 2000, and incorporated
          herein by reference.

   (3)    Filed as an exhibit to Amendment No. 3 to the Registrant's report on
          Form 10-SB on September 29, 2000, and incorporated herein by reference.`

(b)        Reports on Form 8-K. The
Registrant did not file any reports on Form 8-K during the last quarter of the fiscal year ended October 31, 2000.

SIGNATURES

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

|                       | RADIANT ENERGY CORPORATION                                         
|---------------------- | -------------------------------------------------------------------
|Date: January 26, 2001 | By:s/  Bruce R. Nobles
Bruce NoblesPresidentChief Executive Officer

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

`(i)  Principal Executive Officer:

Date: January 26, 2001                               By:s/  Bruce R. Nobles
                                                        ------------------------
                                                     Bruce R. Nobles
                                                     President
                                                     Chief Executive Officer

(ii)  Principal Financial Officer:

Date: January 26, 2001                               By:s/  Colin V.F. Digout
                                                        ------------------------
                                                     Colin V.F. Digout
                                                     Chief Financial Officer
                                                     Secretary

(iii) Directors:

Date: January 26, 2001                               By:s/  David A. Williams
                                                        ------------------------
                                                     David A. Williams
                                                     Chairman of the Board

Date: January 26, 2001                               By:s/  Robert J. Metcalfe
                                                        ------------------------
                                                     Robert J. Metcalfe
                                                     Director

Date: January 26, 2001                               By:s/  Gregory G. O'Hara
                                                        ------------------------
                                                     Gregory G. O'Hara
                                                     Director

Date: January 26, 2001                               By:s/  Michael Lupynec
                                                        ------------------------
                                                     Michael Lupynec
                                                     Director

Date: January 26, 2001                               By:s/  Timothy P. Seel
                                                        ------------------------
                                                     Timothy P. Seel
                                                     Director`

Exhibit 10(n)

SITE LEASEBETWEENTHE COUNTY OF KALAMAZOO
ANDRADIANT AVIATION SERVICES, INC.

This
Site Lease (Lease) dated November 11, 2000, between the County of
Kalamazoo, Michigan (Lessor) and Radiant Aviation Services, Inc., (Lessee) is as
follows:

WHEREAS, Lessee desires to lease a parcel of improved land at the Kalamazoo/Battle Creek
International Airport ("Airport") to construct and operate a facility for deicing aircraft at the
Airport; and

WHEREAS, Lessee's purpose is to provide deicing and other services for aircraft; and

WHEREAS, Lessor is willing to lease a parcel of improved land to Lessee for said purposes.

NOW, THEREFORE, in consideration of the mutual promises,
covenants and obligations in this Lease and other good and valuable consideration, Lessor and Lessee agree as
follows:

ARTICLE I - GROUND AREA

Lessor leases to Lessee,
for the Lessees exclusive use, except as hereinafter provided, and Lessee
leases from Lessor, the following parcel of improved land (Ground
Area or Lessees leased area or leased premises or premises)
consisting of a total of 29,880 square feet, and further described as follows:

A parcel of land consisting
of 29,880 square feet described as: A rectangular area 180 x 166
located in the area, as depicted in Exhibit A.

ARTICLE II- STRUCTURES

Lessee shall construct at
its cost a structure and related improvements on the leased premises. The plans
for said structure shall be approved by the Airport Director prior to
construction as per Article VI. Lessee agrees to maintain the facility in
accordance with all Federal, State and local regulations. The Lessor may elect,
upon written notice given within 30 days after termination of the Site Lease to
have the Lessee remove the structure and related improvements within 90 days at
the Lessees expense.

Notwithstanding any other
provision set forth in this Lease or rule of common law, the parties agree that
any structure and related improvements installed by Lessee shall remain the sole
and exclusive property of the
Lessee and may be removed by Lessee or any party granted a security interest in
the structure and related improvements by Lessee, provided that any damage
caused by such removal to existing improvements to the Ground Area shall be
reasonably repaired.

Lessee may, in addition,
transfer title to any such structures and related improvements so installed by
Lessee to Boeing Capital Corporation or any of its affiliates or to any other
lender in connection with any financing of such structures or improvements,
whether as a security interest or pursuant to a sale/leaseback transaction.

ARTICLE III- TERM

The term of this Lease
shall begin on ,2000, and
shall expire at 12:01 am. on ,
2007 and be automatically renewed for successive three (3) year periods unless
and until such time as either party provides 30 days written notice of
termination prior to the beginning of the renewal period.

ARTICLE IV - RENTALS AND FEES

Lessee agrees to pay to
Lessor for the use of the premises, facilities, rights, licenses, services, and
privileges granted hereunder the following rents and fees:

A.   Ground Rental: Lessee shall pay to Lessor monthly on the
first of each month in advance, the amount of one twelfth of $7470.00.
This rate is based upon twenty-five cents ($.25) per square foot multiplied by
29 880 square feet.

The ground rental may be
adjusted by Lessor to reflect the reasonable costs of maintaining and operating
the Airport to permit said Airport to be operated on a self-sustaining basis.
Provided, however, that the ground rental shall not exceed $.025 per square foot
from ___________, 2000 through ___________, 2010, $0.28 per square foot from
___________, 2010 through ___________, 2016, $0.32 per square foot from
_____________, 2016 through ____________, 2022. Any ground rental adjustment
shall be made simultaneously by Lessor on all parcels similarly leased to
for-profit tenants on the Airport to reflect an equitable charge basis for all
for-profit tenants.

B. Operational Rental:
Lessee agrees to pay to Lessor as annual rental for the use of the premises,
facilities, licenses, services, and privileges here in granted by Lessor a sum
equal to Three percent (3%) of the first Five Hundred Thousand Dollars
($500,000.00) of gross sales made by Lessee, two percent (2%) of the
next Five Hundred Thousand Dollars ($500,000.00) of gross sales, and
one percent (1%) of of gross sales in excess of One Million Dollars
($1,000,000.00). Such sum of Operational Rental shall be reduced or credited
dollar for dollar by the amounts paid to Lessor for ground rentals as provided
in section A above.

Lessor and lessee agree
that the ground rental as provided above is a minimum unusable because of
circumstances beyond the control of Lessee, the ground rental shall be reduced
accordingly on a pro rata basis.

The term gross
sales as used herein shall mean charges and sales for aircraft deicing
and/or anti-icing services made by Lessee and all other services from the
operation herein granted; excluding Federal, State or municipal sales or excise
taxes or other similar taxes separately stated and collected from customers of
Lessee nor or hereafter levied or imposed.

It is furtheragreed that the operation rental herein provided shall be paid annually on or before
May 15 for the preceding calendar year. Each such payment shall be accompanied
by a signed annual financial statement listing gross sales and gross revenues.

C. Renegotiation of Rentals
and Fees for Option Period: In the event Lessee exercises its option to extend
the Lease for the additional terms beyond _____________, 2022, as permitted by
Article III, the parties shall agree upon the rental and fees to be charged
during the additional term or terms; provided, however, that if the parties are
unable to agree upon the rentals and fees to be charged during the additional
term or terms within 60 days after Lessee has exercised its option to extend,
Lessee may rescind its election to extend and the Lease shall expire at the end
of the then existing term.

ARTICLE V - USES AND PURPOSES

It is understood and agreed
that nothing herein contained shall be construed to grant or authorize the
granting of an exclusive right within the meaning of the Federal Aviation Act of
1958, as amended. Lessor is not hereby prevented from granting exclusive or
non-exclusive licenses to others covering the furnishing of services of a type
reasonably subject to such control by Lessor and not basically a part of
Lessees operations, including, but not limited to, ground transportation
services, provided that Lessors control of such service shall not impair
service to Lessee. Lessee is hereby granted the exclusive use of the leased
premises described in Articles I and II hereof, subject to the terms and
provisions hereof, for any and all purposes in connection with the conduct by
Lessee of its business, including without limitation, the following uses and
purposes:

1.       The right to deice and /or anti-ice aircraft or other equipment of Lessee, or any customer
or invitee of Lessee, within the Lessee's leased area and in such other areas as are designated by
the Lessor;

2.       The right to hold, park or otherwise retain aircraft or other equipment of Lessee, or any
customer or invitee of Lessee, within the Lessee's leased area and in such other areas as are
designated by the Lessor;

3. The right to place
advertising messages from third parties on the inside and outside of the
structure and/or related improvements, provided that such messages are in
compliance with Federal, State and local laws and regulations and such messages
are placed so as not to interfere with, obstruct or otherwise inhibit air
service. Lessor will approve review and pre-approve all such advertising for
editorial content. Such approval shall not be unreasonably withheld by Lessor.

Subject to reasonable rules
and regulations promulgated by Lessor in accordance with the Rules and
Regulations Section hereof, Lessee shall have the rights and privilege on, over
and across the Airport of ingress and egress to and from the premises and
facilities described in Article I and II for its employees, agents, passengers,
guests, members, patrons and invitees, its or their suppliers of material and
furnishers of service, its or their aircraft equipment, vehicles, machinery and
other property; provided that the Lessor is not hereby prevented from granting
exclusive or non-exclusive licenses to others covering the furnish of services
of a type reasonably subject to such control by Lessor and not basically a part
of Lessors control of such service shall not impair service to Lessee or
cause additional costs to the Lessee. Except for automobile parking fees and
aircraft landing fees for Lessees owned or operated aircraft, and except
as herein otherwise specifically provided, no charges, fees, nor tolls of any
nature, direct or indirect shall be imposed by Lessor upon Lessee, its
employees, agents, passengers, guests, patrons and invitees, or its or their
suppliers of materials and furnishers of service for rights of ingress and
egress or for the privilege of purchasing, selling, or using any materials or
services furnished or otherwise obtained by Lessee.

Lessee agrees to operate
the premises leased for the use and benefit of its customers, without
discrimination as prohibited by law, and agrees to furnish good, prompt, and
efficient services reasonably adequate to meet the demands for its service at
the Airport.

It is clearly understood by
the Lessee that no right nor privilege has been granted which would operate to
prevent any person, firm, or corporation operating aircraft on the Airport from
performing any services on its own aircraft with its own regular employees
(including, but not limited to, maintenance and repair) that it may choose to
perform.

ARTICLE VI- CONSTRUCTION BY LESSEE UPON GROUND AREA

Lessee shall not construct
any buildings, structures or related improvements on said premises which
conflict with the Airport Master Plan of said Airport as existing at such time
and as on file with the Federal Aviation Administration. Subject to such
restrictions, Lessee, at its own expense, may construct or install (in
accordance with applicable laws and ordinances, local rules and regulations, and
applicable runway clearance requirements) in or on Ground Area described in
Article I hereof any buildings, structures, or related improvements and
equipment that it shall determine to be appropriate for use in connection with
its operations; provided, however, that Lessee shall submit to Lessor for review
the plans and specifications of any such buildings, structures, and related
improvements prior to construction or installation thereof; and Lessor shall
have the right to refuse to permit such construction or installation if the
external appearance thereof does not meet Lessors reasonable requirements
for substantial uniformity of appearance of all buildings and structures on the
Airport, or if the type or time of construction or installation or the location
thereof does not meet Lessors reasonable requirements for safe use of the
Airport and appurtenances by other authorized persons. Lessee shall have the
right to alter, modify, repair, and maintain any buildings, structures or
related improvements constructed or installed on premises leased hereunder,
subject to the above restrictions applicable to new construction.

Lessor may, at its own
cost, inspect any such construction or installation. If such construction or
installation has not been completed in accordance with the plans and
specifications therefore approved by Lessor, Lessor may by written notice demand
that the Lessee make appropriate changes in such construction or installation;
and if such changes have not been undertaken by the Lessee within thirty (30)
days of Lessors notice, Lessor may, but shall not be obligated to, enter
upon the premises involved and perform such obligation of Lessee, charging the
Lessee the reasonable cost and expense thereof, and Lessee agrees to pay Lessor
such charge in addition to any other amounts payable by Lessee hereunder. It is
further agreed that if Lessor shall perform any of Lessees obligations in
accordance with the provisions of this section, Lessor shall not be liable to
Lessee for any loss of revenue to Lessee resulting from such performance.

No restrictions shall be
placed upon Lessee as to the architects, builders, or contractors who may be
employed by it in connection with the construction, installation, alteration,
modification, repair or maintenance of any such buildings, structures, or
improvements; and Lessor shall provide free ingress and egress to same by routes
designated by Lessor for all persons, materials, or things connected with the
construction, installation, alteration, modification, repair, or maintenance
thereof.

ARTICLE VII- MAINTENANCE, REPAIR, AND OPERATION

Except as otherwise
provided in this Article, Lessee shall keep and maintain the Ground Area
hereunder leased to Lessee and all improvements, facilities, and additions
thereto which have been or will be constructed or installed by it or by Lessor
upon the Area, in good condition and repair, reasonable wear and tear excepted.
No restrictions shall be placed upon Lessee as to the architects, builders, or
contractors who may be employed by it in connection with the alteration, repair,
or maintenance of any such equipment, improvements, facilities and additions.

Lessee shall keep the
premises hereunder leased to Lessee in a sanitary and sightly condition and
shall provide all necessary services with respect thereto.

In the event that Lessee
fails to perform, for a period of thirty (30) days after written notice from
Lessor to do so (or if the obligations reasonably require more than thirty (30)
days and if the Lessee fails to commence such performance and diligently
prosecute such performance to completion), any obligations required by this
Article VII to be performed by Lessee at Lessees cost, Lessor, upon the
expiration of such thirty (30) day or extended period, may, but shall not be
obligated to, enter upon the premise involved and perform such obligation of
Lessee, charging the Lessee the reasonable cost and expense thereof, and Lessee
agrees to pay Lessor such charge in addition to any other amounts payable by
Lessee hereunder; provided, however, that if Lessees failure to perform
any such obligation adversely affects or endangers the health or safety of the
public or of employees of Lessor, and if Lessor so states in its aforesaid
notice to Lessee, Lessor may, but shall not be obligated to, perform such
obligation of Lessee at anytime after the giving of such notice and without
awaiting the expiration of said thirty (30) day period, and charge to Lessee,
and Lessee shall pay as aforesaid, the reasonable cost and expense of such
performance. It is further agreed that if Lessor shall perform any of the
obligations in accordance with the provisions of this
section, Lessor shall not be liable to Lessee for any loss of revenue to Lessee
resulting from such performance.

ARTICLE VIII- RIGHT OF ENTRY BY LESSOR

Subject to the reasonable
rules and regulations promulgated by Lessor in accordance with the Rules and
Regulations Section hereof, Lessee shall have the right and privilege on, over
and across the Airport of ingress and egress to and from the premises and
facilities described in Article I and II for its employees, agents, guests,
members, patrons and invitees, its or their suppliers of materials and
furnishers of service, its or their aircraft equipment, vehicles, machinery and
other property.

Lessor may enter upon the
premises now or hereafter leased exclusively to Lessee hereunder at any
reasonable time for any purpose necessary, incidental to or connected with the
performance of its obligations hereunder, in the exercise of its governmental
functions, in the event of emergency, or in connection with any improvement
project relating to the Airport, provided that any such activity materially
reducing the use of said premises shall be subject to reasonable notice and
proportionate reduction in rents during said period.

ARTICLE IX - UTILITY SERVICES

Lessor agrees to provide
such written consents, easements, etc. as Lessee may reasonably require to
obtain the extension of utility services to the Ground Area. Lessee shall
arrange and pay for installation of all necessary utility services for its
facility. Lessee agrees to pay all utility charges. Lessor has the right to
supply or, by arrangement with appropriate utility companies or suppliers, to
supply Lessee with all utility services at rates not exceeding those which
Lessee would have to pay if Lessee established the same demand and took the same
quantities directly from such utility companies or suppliers.

ARTICLE X - RULES AND REGULATIONS

Lessor shall adopt and
enforce reasonable rules and regulations and any reasonable amendments thereto
with respect to the use of the Airport, which shall provide for the safety of
those using the Airport. Lessee agrees to observe and obey such rules and
regulations and ordinances or laws of the Lessor, State of Michigan, United
States Government, or agencies thereof as the same may from time to time exist;
provided that such rules, regulations, ordinances, or laws shall be consistent
with safety and with rules, regulations, and orders of the Federal Aviation
Administration and Michigan Aeronautics Commission with respect to aircraft and
fixed-base operations at the Airport; and provided further that such rules and
regulations shall not be inconsistent with the
procedures prescribed or approved from time to time by the Federal Aviation
Administration with respect to the operation at the Airport.

ARTICLE XI- COVENANT AGAINST DISCRIMINATION

Pursuant to the
Elliott-Larson Civil Rights Act (1976 PA 453), as amended, and the Michigan
Persons with Disabilities Civil Rights Act, as amended, Lessee agrees not to
discriminate against any employee or applicant for employment to be employed in
the performance of this Agreement with respect to hire, tenure, terms,
conditions, or privileges of employment, or a matter directly or indirectly
related to employment because of race, color, religion, national origin, age,
sex, height, weight, marital status, or disability. Breach of this covenant may
be regarded as a material breach of this Lease.

Lessee, its agents,
employees, successors, and assigns in the conduct of its operations and
activities will not on the grounds of race, sex, religion, or national origin
discriminate nor permit discrimination against any person or group of persons in
any manner prohibited by Title VI of the Civil Rights Act of 1964, or by Part 21
of the Regulations of the Office of the Secretary of Transportation (DOT); it is
further understood and agreed that the Lessor shall have the right to take such
action as the Federal Government may direct to enforce this obligation. Lessee
further agrees to comply with such enforcement procedures as the United States
might demand that the Lessor take in order to comply with the Sponsors
(Lessors) Assurances to the Federal Government.

ARTICLE XII- INSURANCE AND INDEMNIFICATION

Lessee shall, during the
term of this Lease, maintain fire and extended coverage insurance under the
special property form on all buildings and structures located on the Ground Area
described in Article I in an amount equal to the replacement cost of the
buildings or structures. All such policies of insurance and renewals thereof
shall insure the Lessor and the Lessee, as their interests may appear. Lessee
shall file with the Airport Director certificates showing such insurance to be
in effect with premiums paid.

Lessee shall provide to
Lessor a Certificate of Insurance providing for the following coverages on an
occurrence basis for liabilities out of the Lessees use or operation of
the Leased Premises: (1) premises liability, including property damage, bodily
injury, personal injury and contractual liability with policy limits of at least
Five Million Dollars ($5,000,000.00); (2) completed operations and product
liability with policy limits of at least Five Million Dollars ($5,000,000.00)
(if applicable). The Certificate(s) of Insurance shall specifically provide that
the County of Kalamazoo and its officers, employees, and agents are name as
additionally insured. In addition, Lessee shall provide to Lessor a Certificate
of Insurance covering Workers Compensation for Lessees employees, if
any. If Lessee owns any motor vehicles used on the Ground Area or in used in
providing services as permitted in this agreement, then Lessee shall also
provide Lessor with a Certificate of Insurance providing automobile bodily
injury and property damage liability of at least Five Hundred Thousand Dollars
($500,000.00). All of these Certificates of Insurance shall provide that the
respective insurance policy cannot be canceled without providing a thirty
(30) day written notice to Lessor. The usual words in the cancellation clauses
of the Insurance Certificates which state endeavor to and
failure to mail such shall impose no obligation or liability of any kind
upon the company shall be stricken. Failure of the Lessee to provide the
Certificates of Insurance or receipt by the County of a notice of cancellation
of the insurance policy(ies) by the Lessees insurance company(ies) shall
constitute a material breach of this Lease and this Lease may be terminated five
(5) business days after written notice to Lessee if such insurance is not
replaced or reinstated. 180 days before the end of each three (3) year period of
the term of this Lease and any extensions, the parties shall review the limits
of Lessees liability insurance as required above.

Lessee shall indemnify and
save harmless the Lessor from any liability losses or claims occurring during
the term of this lease which the Lessor may suffer as a result of any negligent
or omission of said Lessee, its employees, agents, or representatives in
connection with the use of said premises.

ARTICLE XIII- LICENSE FEES AND TAXES

Lessee shall pay all lawful
taxes and assessments which, during the term hereof, may become a lien upon or
which may be levied by the State, County, City or any other tax levying body,
upon any taxable interest of Lessee acquired in this Lease Agreement, as well as
all taxes on taxable property, real or personal, owned by Lessee in and about
said premises; but deferment of payment of any tax by Lessee shall not
constitute a default or breach of this Lease Agreement during the time that the
Lessee is contesting in good faith the payment of said tax before any duly
constituted authority and pending the final determination of such contest.

Lessee will, when requested
annually, within thirty (30) days after the end of each calendar year, furnish
the Lessor a certification showing that all taxes which might become a lien
against the personal property of Lessee have been paid in full.

ARTICLE XIV - SERVICES TO BE FURNISHED ON A FAIR BASIS AND EQUAL BASIS

Lessee agrees that it will
(1) furnish any services to be provided by it hereunder on a fair and not
unjustly discriminatory basis to all users thereof, and that it will (2) charge,
reasonable, and not unjustly discriminatory prices for each unit of sales or
service; provided that Lessee may be allowed to make reasonable and
non-discriminatory discounts, rebates, or similar types of price reductions to
volume purchasers.

ARTICLE XV- CANCELLATION BY LESSOR

Lessor may cancel this
Agreement by giving Lessee not less than sixty (60) days advance written notice
to be served as hereinafter provided upon or after the happening of any one of the
following events:

1. The filing by Lessee of a voluntary petition in bankruptcy;
2. The institution of proceedings in bankruptcy against Lessee and the adjudication of Lessee
as a bankrupt pursuant to such proceedings if such adjudication shall remain unvacated or unstayed
for a period of at least sixty (60) days;
3. The taking by a court of jurisdiction of Lessee and its assets pursuant to proceedings brought under the
provisions of any federal reorganization act if the judgment of such court shall
remain unvacated or unstayed for a period of at least sixty (60) days;
4. The appointment of a receiver of Lessee's assets if such appointment by a court of
competent jurisdiction shall remain unvacated for a period of at least sixty (60) days;
5. The divestiture of Lessee's estate herein by other operation of law, except as provided in
Article XX hereof,
6. The abandonment by Lessee of its conduct of service at the Airport,
7. If the Lessee shall be prevented for a period of sixty (60) days (after exhausting or abandoning all
appeals) by any action of any governmental authority, board, agency, or officer
having jurisdiction from conducting service at the Airport; unless it is so
prevented from conducting air transportation either (1) by reason of the United
States or any agency thereof, acting directly or indirectly, taking possession
of and operating, in whole or in substantial part, the premises and space leased
or operated by the Lessee or premises required for the actual operation of
Lessees aircraft to and from the Airport; or (2) if all or a substantial
part of the premises and space leased by the Lessee shall be acquired in the
manner described in Article XX hereof,
8. 8. The default by Lessee in the
performance of any covenant or agreement herein required to be performed by
Lessee, and the failure of Lessee to remedy such default for a period of ninety
(90) days after receipt from Lessor of written notice to remedy the same;
provided, however, that no notice of cancellation, as above provided, shall be
of any force or effect if Lessee shall have remedied the default prior to
receipt of Lessors notice of cancellation.

No waiver of default by
Lessor of any of the terms, covenants, or conditions hereof to be performed,
kept, and observed by Lessee shall be construed to be or act as a waiver of any
subsequent default of any of the terms, covenants, and conditions herein
contained to be performed, kept and observed by Lessee. The acceptance of rental
by Lessor for any period or periods after a default of any of the terms,
covenants and conditions herein contained to be performed, kept and observed by
Lessee shall not be deemed a waiver of any right on the part of Lessor to cancel
this Agreement for failure by Lessee to so perform, keep, or observe any of the
terms, covenants, or conditions of this Agreement.

ARTICLE XVI- CANCELLATION BY LESSEE

Lessee may, so long as it
is not in default in any payments to Lessor hereunder, cancel this Agreement by
giving Lessor not less than sixty (60) days advance written notice to be served
as hereinafter provided, upon or after the happening of any one of the following
events:

1. Issuance by any court of
competent jurisdiction of an injunction in any way substantially preventing or
restraining the use of the Airport or any part thereof necessary for
Lessees operation, and the remaining in force of such injunction for a
period of at least thirty (30) days after Lessor has exhausted or abandoned all
appeals,
2. The default by Lessor in
the performance of any covenant or agreement herein required to be performed by
Lessor and the failure of Lessor to remedy such default for a period of ninety
(90) days after receipt from Lessee of written notice to remedy the same;
provided, however, that no notice of cancellation, as above provided, shall be
of any force or effect if Lessor shall have remedied the default prior to
receipt of Lessees notice of cancellation;
3. Failure of Lessor and
Lessee to agree on reduction of the rentals and fees set forth in Article IV
within sixty (60) days if (i) a change in the federal airspace regulations
impairs or hinders the use of the Airport by aircraft or (ii) there is a change
to the operation of the Airport not caused by Lessee, which change materially
adversely impacts the economic benefits to be derived from its operations at the
Airport [and Lessee has not otherwise withdrawn its request for a reduction in
the fees and rentals].

Lessees performance
of all or any part of this Agreement for or during any period or periods after a
default of any of the terms, covenants, and conditions herein contained to be
performed, kept, and observed by Lessor shall not be deemed a waiver of any
right on the part of Lessee to cancel this Agreement for failure by Lessor to so
perform, keep or otherwise observe any of the terms, covenants or conditions
hereof to be performed, kept and observed by Lessor or be construed to be or act
as a waiver by Lessee of any subsequent default of any of the terms, covenants,
and conditions herein contained to be performed, kept and observed by Lessor.

ARTICLE XVII- SURRENDER OF POSSESSION

So long as the rentals and
other fees and charges required by this Lease are paid and all other material
conditions of this Lease are duly performed, said Lessee shall have peaceful and
quiet possession of the ground area for the term hereof; and at the expiration
of said term, the ground area shall be restored to said Lessor in as good order
and condition as when delivered, ordinary wear and tear and damage by fire the
elements, casualty, or other cause not due to the negligence of the Lessee
excepted. At the expiration or early termination of the term of this Lease, the
Lessee shall remove the structure, related improvements and equipment within 90
days at the Lessees expense.

ARTICLE XVIII- MINERAL RIGHTS

It is agreed and understood that all water, gas, oil and mineral rights in and under the soil are
expressly reserved to Lessor.

ARTICLE XIX - CONDEMNATION

Upon the acquisition by
condemnation or the exercise of the power of eminent domain under any Federal or
State statute by the Federal Government, the State of Michigan or any Federal or
State agency or any other person vested with such power, of a temporary or
permanent interest in all or any part of the Airport, including without
limitation, the premises leased hereunder, the Lessor and the Lessee each shall
have the right to appear and file a claim for damages to the extent of its
respective interest, in the condemnation or eminent domain proceeding, to
participate in any and all hearings trials, and appeals therein, and to receive
and retain such amount as each may lawfully be entitled to receive as damages or
payment as a result of such acquisition.

ARTICLE XX - ASSIGNMENT AND SUBLETTING

Lessee shall not assign,
nor sublet this Agreement or any part hereof without the consent in writing of
Lessor, except to (i) a corporation, limited liability company or other entity
owned and controlled by Lessee or (ii) Boeing Capital Services Corporation, or
its affiliates, or other institutional lending or financing entity;
provided that the foregoing shall not prevent the assignment of this Agreement
to the United States Government or any agency thereof. Lessor reserves the right
to assign this Lease to another governmental body or authority in the event such
governmental body or authority takes over the operation of the Airport. Lessor
agrees that it will not unreasonably withhold, delay or condition its consent to
any other assignment or subletting.

ARTICLE XXI- NOTICES

Notices to Lessor provided
for herein shall be sufficient if sent by certified mail, postage prepaid,
addressed to Airport Director, Kalamazoo/Battle Creek International Airport,
5235 Portage Road, Kalamazoo, Michigan 49002; and notices to Lessee, if sent by
certified mail, postage prepaid, addressed to CFO, Radiant Aviation Services
INC., 40 Centre Drive, Orchard Park, NY, 14127; or to such other respective
addresses as the parties may designate to each in writing from time to time, or
to such other mailing addressees as may be adopted by either Lessor or Lessee

ARTICLE XXII -DEFINITION OF TERMS

Whenever the term
Federal Aviation Administration is used in this Agreement it shall
be construed as referring to the successor of the Federal Aviation agency
created by the Federal Government under the Civil Aeronautics Act of 1958, or to
such other Federal Government authority as may be the successor thereto or be
vested with the same or similar authority.

Whenever the terms "aircraft or other equipment of Lessee" and "aircraft and other equipment"
are used in this Agreement, they shall be construed as including airplanes, helicopters and every other
conveyance now or hereafter used for the navigation of or flights in air and
other equipment owned, operated, or used by Lessee.

Whenever the term person and persons are used in this Agreement, they
shall be construed as including individuals, firms, corporations and other legal
entities.

ARTICLE XXIII- PARAGRAPH HEADINGS

The paragraph headings contained herein are for convenience in reference and are not intended to define
or limit the scope of any provision of this Agreement.

ARTICLE XXIV - INVALID PROVISIONS

In the event any covenant,
condition or provision herein contained is held to be invalid by any court of
competent jurisdiction, the invalidity of any such covenant, condition, or
provision shall in no way affect any other covenant, condition, or provision;
provided, that the invalidity of such covenant, condition, or provision does not
materially prejudice either Lessor or Lessee in its respective rights and
obligations contained in the valid covenants, conditions, or provisions of this
Agreement.

ARTICLE XXV - SUCCESSORS AND ASSIGNS BOUND BY COVENANTS

All the covenants,
stipulations, and agreements in this agreement shall extend to and bind the
legal representatives, successors and assigns of the respective parties hereto.

ARTICLE XXVI- RIGHT TO LEASE TO UNITED STATES GOVERNMENT

During time of war or national emergency, Lessor shall have the right to enter into an agreement with
the United States Government for military or naval use of part or all of the
landing areas, the publicly-owned air navigation facilities, and/or other areas
or facilities of the Airport. If any such agreement is executed, the provisions
of this instrument, insofar as they are inconsistent with the provisions of the
agreement with the government, shall be suspended.

This Agreement shall be subordinate to the provisions of any outstanding agreement between
Lessor and the United States relative to the maintenance, operation, or development of the
Airport.

ARTICLE XXVII- STANDARDS

Lessor and Lessee agree
that minimum standards of operation will be maintained in conformity with
requirements of the Federal Aviation Administration and that any additions to
facilities will be so established.

In the event that the
Kalamazoo/Battle Creek International Airport is moved from its existing
location, or is closed or abandoned during the terms of this Lessor agrees to
give consideration to Lessee for the purpose of continuing Lessees
operation on the relocated site, if such site is owned and controlled by Lessor.

ARTICLE XXVIII - OPERATION OF AIRPORT

It is understood and agreed
that the rights granted by this agreement will not be exercised in such a way as
to unreasonably interfere with or adversely affect the use, operation,
maintenance, or development of the Airport. Lessee shall have the reasonable use
in common with others of all entrances, exits, taxiways, ramps, auto parking
areas, and other means of movement now existing in connection with said
premises; but such use shall not unreasonably interfere with any other
reasonable use of said areas. Lessor reserves the right (but shall not be
obligated to Lessee) to maintain and keep in repair the landing area of the
Airport and all publicly-owned facilities of the Airport, and reserves the right
to direct and control all activities of the Lessee in this regard.

Lessor reserves the right
to develop or improve the landing area and all publicly-owned air navigation
facilities of the Airport as it sees fit, regardless of the desires or views of
Lessee, and without interference or hindrance. Lessor also reserve the right to
take any action it considers necessary to protect the aerial approaches of the
Airport against obstruction, together with the right to prevent Lessee from
erecting, or permitting to be erected any building or other structure on the
Airport which in the opinion of the Lessor would limit the usefulness of the
Airport or constitute a hazard to aircraft.

ARTICLE XXIX - CLASSIFICATION OF BUILDING AS REAL PROPERTY

Any other article or
paragraph of this Lease and Agreement to the contrary notwithstanding, all
buildings on the leased premises, whether constructed by Lessors
predecessors in title, Lessor, or Lessee, shall be considered to be real
property and exempt from property taxation under MCLA 211.181(2)(b); MSA
7.7(5)(2)(b).

ARTICLE XXX - LESSEE TO BE A CONCESSIONAIRE; REQUIRED SERVICE

Lessee shall be a
concessionaire under the terms of this Agreement and shall provide to the
public, as part of its concessionaires services, services described in Article
V.

ARTICLE XXXI - OPTION TO INCORPORATE MORE FAVORABLE LEASE CONDITIONS OR TERMS

In the event Lessor enters
into any other lease or agreement involving the Airport with a for-profit entity
which contains any condition or term considered by Lessee to be more favorable
to the Lessee in that lease than the terms or conditions of this Lease, then
Lessee shall have the option to incorporate those terms and conditions
considered more favorable by Lessee into this Lease upon thirty (30) days
written notice to Lessor,

ARTICLE XXXII- SNOW PLOWING/REMOVAL

Lessor shall plow and
remove snow adjacent to the Ground Area so as to provide easy ingress and egress
by aircraft and other equipment. Those adjacent areas shall be included in the
Airport snow plowing and removal plan with a priority immediately following
runways and taxiways. Lessee shall be responsible for plowing and removing snow
from the Ground Area.

ARTICLE XXXIII- LESSEE'S ENVIRONMENTAL RESPONSIBILITY

Lessee shall defend,
indemnify, and hold harmless Lessor from any damages, costs, losses,
liabilities, or expenses (including experts fees, attorneys fees,
and testing and remediation costs) resulting from any environmental
contamination of the Ground Area, or adjacent lands, which contamination occurs
after the effective date of this Lease and which is determined to have been
caused by Lessees use of the Ground Area.

Lessee agrees to comply
with all Federal, State, or local laws relating to the manufacturing,
processing, distribution, use, treatment, storage, disposal, transport, or
handling of pollutants, contaminants, chemicals, or industrial, toxic, or
hazardous substances or wastes. Within thirty (30) days of the beginning of the
term of this Lease and on each anniversary thereafter, Lessee shall submit to
Lessor a list of all the above substances that Lessee has on the leased
premises. Lessee also agrees that Lessor may, but is not require to, inspect the
leased premises for the above substances at any reasonable time. If Lessor
conducts an inspection and recommends a change in Lessees procedure
regarding any substance, Lessee agrees to use reasonable efforts to implement
Lessors recommendation and will do so in a safe, proper manner

If there is an
environmental spill or release as defined under Federal or State regulations of
any of the above substances on the leased premises at any time, or if Lessee,
its officers, directors, or employees cause an environmental spill or release on
the Airport other than the leased premises, Lessee agrees to (1) immediately
report such spill or release to Lessor and to the appropriate Federal, State or
local authorities; and (2) take immediate action to contain and clean up the
spill or release at Lessees expense. In this situation, Lessee agrees to
defend, indemnify, and hold Lessor and its officers and employees harmless from
and against any damage, loss, liability, expense, suit, claim, judgment, fine or
demand, including attorneys fees, investigation and remediation costs, and
court costs arising out of or incident to such spill or release.

Lessee shall defend,
indemnify, and hold Lessor and its officers and employees harmless from and
against any damage, loss, liability, expense, suit, claim, judgment, fine, or
demand, including attorneys fees, investigation and remediation costs, and
court costs arising out of Lessees use of the public or private sewer system,
including any environmental claims.

ARTICLE XXXIV- EFFECTIVE DATE OF LEASE

This Lease shall not be
effective, and no obligations, duties or responsibilities shall be imposed or
required of either party hereto, until both Lessor and Lessee have signed a
written document, which shall he attached to this Lease, stating that the
following conditions have been met:

1. A drawing or design of a proposed deicing facility has been submitted by the
Lessee to the Airport Director, and the Airport Director has given approval.
2. The insurance certificates required under Article XII of the Lease have been
submitted to and approved by the Airport Director.

|COUNTY OF KALAMAZOO                                    | RADIANT AVIATION SERVICES, INC.                            
|------------------------------------------------------ | -----------------------------------------------------------
|__________________________Timothy Snow, Clerk/Register | By:________________________________
Larence Wenke, Chairman

Exhibit 10(o)

RADIANT ENERGY CORPORATION
andRADIANT AVIATION SERVICES, INC.
as the CorporationsandBRUCE NOBLESas Nobles

---

EMPLOYMENT AGREEMENT
Effective Date: October 26, 2000

---

EMPLOYMENT AGREEMENT

Employment agreement dated as of October 26, 2000, by and among Radiant Energy
Corporation, an Ontario corporation ("REC"), and Radiant Aviation Services, Inc., a Delaware
corporation ("RAS") (REC and RAS being collectively referred to as the "Corporations") and Bruce
Nobles ("Nobles").

WHEREAS the Corporations and Nobles are desirous of entering into an
employment relationship for their mutual benefit:

AND WHEREAS the employment relationship between the parties will commence
on the Effective Date of this Agreement;

AND WHEREASthe Corporations and Nobles have agreed that the terms and
conditions of the employment relationship shall be as set out herein;

NOW THEREFORE in consideration of the respective covenants and agreements
herein contained and for other good and valuable consideration (the receipt and sufficiency of which
are hereby acknowledged by each of the parties hereto), the parties hereto agree as follows:

ARTICLE 1DEFINITIONS

1.1        Defined Terms.
As used in this Agreement, the following terms have the following meanings:

"Applicable Time Period" means the period commencing with the date of the
termination of Nobles' employment with the Corporations and ending on the later of the first
anniversary of the date of such termination or the date all Termination Payments pursuant
to Section 5.2 have been made.

"Arm's Length" has the meaning given to that term in the Income Tax Act
(Canada) as now in effect;

"Business" means the business presently and heretofore carried on by the
Corporations consisting of supply, financing and/or operations of radiant energy deicing systems;

"Change of Control" means either (i) the occurrence of a transaction that results
in a Person acting at Arm's Length from the Corporations obtaining shares or debt carrying
more than 50% of the votes attaching to all of the then outstanding shares and that results in
the execution of significant influence over the Corporations; or (ii) the sale of all or
substantially all of the assets used in the Business to a Person acting at Arm's Length from the
Corporations;

"Customer" means any Person which in the year preceding the date of the
termination of the employment of Nobles with the Corporations has been a customer of the
Corporations or a solicited potential customer of the Corporations;

"Person" includes, without limitation, an individual, corporation, partnership, joint
venture, association, trust, firm, unincorporated organization or other legal or business entity;

"Subsidiary" has the meaning given to that term in the Business Corporations Act
(Ontario) as now in effect; and

"Territory" means the present geographical area of: (i) the Province of Ontario; plus
(ii) the remainder of Canada; plus (iii) the United States of America.

ARTICLE 2SCOPE OF EMPLOYMENT

2.1        Employment. Subject to the terms and conditions set forth in this
Agreement, the Corporations hereby agree to employ Nobles, and Nobles hereby
accepts such employment, on a full time basis, in the position of President and
Chief Executive Officer for a period beginning on December 1, 2000 (the
Effective Start Date) and continuing for a period of three (3) years
or until the earlier termination of Nobles employment as provided in this
Agreement. Upon the expiration of the initial three (3)-year term, this
Agreement may be renewed upon mutual agreement.

2.2        Duties and
Responsibilities. The duties and responsibilities of Nobles shall consist of
those necessary or incidental to perform the functions of such aforesaid
executive office of the Corporations. Nobles shall be responsible for the
overall direction and management of the Corporations. Nobles shall perform such
other duties and exercise such powers as may from time to time be determined by
the Board of Directors of the Corporations consistent with his position as
President and Chief Executive Officer of the Corporations. For a period not to
exceed twelve (12)-months from the Effective Start Date, Nobles shall perform
the vast majority of his non-travel work time in RAS corporate
headquarters located in Buffalo, or at Nobles office in Dallas.

2.3        Full and
Faithful Service. Nobles will devote to the business and affairs of the
Corporations all of the time and attention reasonably necessary to carry out the
duties of his position, and will ensure that he is not at any time engaged in
conduct which would constitute a conflict with the interests of the
Corporations. During his employment with the Corporations, Nobles shall not
engage in any other employment or gainful occupation, undertake any other
business, or become a director, officer or agent of any other corporation,
company, partnership, firm or any other manner whatsoever, without the express
written consent of the Chairman of REC, such consent not to be unreasonably withheld.

2.4        Liability
Insurance. Subject to the by-laws of the Corporations and
applicable law, the Corporations shall purchase and maintain directors and
officers liability insurance for the benefit of Nobles. Such liability insurance
shall be in an amount equal to that provided to all other directors and officers
of the Corporations.

2.5        Acknowledgment.
Nobles acknowledges that the effective
performance of his duties requires the highest level of integrity and the
Corporations complete confidence in Nobles. Nobles shall diligently,
faithfully and honestly serve the Corporations during the continuance of his
employment hereunder and shall use his best efforts to promote the interests of
the Corporations.

ARTICLE 3CURRENCY

3.1        All amounts are in US dollars.

ARTICLE 4REMUNERATION

4.1        Salary. As remuneration for his services hereunder, Nobles shall be
paid a base salary, subject to adjustments as hereinafter provided, (the
Base Salary) at the rate of Two Hundred Twenty-Five Thousand Dollars
($225,000) per annum, which Base Salary shall be paid in arrears and in
twenty-six (26) equal installments, subject to all necessary statutory
deductions. Such Base Salary shall be reviewed by the REC Board of Directors on
an annual basis with no obligation to effect an increase thereof.

4.2        Incentive
Compensation Program. Nobles shall participate in the Corporations
annual incentive compensation program which is to be determined on the basis of
actual performance against performance targets in (a) new installations, (b) net
profit and (c) other parameters to be mutually agreed annually. Under such
program, Nobles will be eligible to earn a target of 50% of the Base Salary to a
maximum of 100% of the Base Salary contingent on the annual performance of the
Corporations.

4.3        Stock
Options. Upon signing this Agreement, Nobles shall receive 250,000 stock
options in REC with an exercise value of four dollars ($4) each based upon the
recommendations of the Compensation Committee and as approved by the REC Board
of Directors. Nobles may receive additional stock options in REC based on the
recommendations of the Compensation Committee and as approved by the REC Board
of Directors from time to time. Such options shall vest as follows:

(a)     at the end of Nobles' first full year
of employment, an option to purchase 83,333 shares of the common stock of REC (the "First Option");

(b)     at the end of Nobles' second full year of employment, an option to purchase
83,333 shares of the common stock of REC (the "Second Option");

(c)     at the end of Nobles' third full year of employment, an option to purchase
83,334 shares of the common stock of REC (the "Third Option"); and

(d)     any additional stock options granted after the date of signing this Agreement
(the Additional Options) shall vest as provided in the grant thereof (the
First, Second, Third and Additional Options being collectively referred to as
the Options).

Except as otherwise set
forth herein, the Options may be exercised in whole or in part at any time and
from time to time from the amount vested within five (5) years from the date of
vesting. The terms and conditions of the Options are subject to the terms and
conditions of the Employee Stock Option Plan as may be amended from time to time
by REC.

In
the event of a Change of Control, all Options not yet vested shall vest on the
date of the Change of Control. If Nobles employment is terminated by the
Corporations for any reason other than cause (as hereinafter defined), all
Options not yet vested in the year of such termination shall vest upon
termination. Upon termination of Nobles employment for any reason, all fully
vested Options may be exercised in whole or in part at any time and from time to
time within two (2) years from the date of termination.

4.4        Benefits. Nobles
will be entitled during the course of his
employment with the Corporations to participate in the employee benefit plans
and programs of the Corporations, including, without limitation, medical and
dental, group life, disability insurance and a non-qualified 401(k) plan, which
are made available to employees of the Corporations generally from time to time
in accordance with the terms of such benefit plans and programs. The
Corporations hereby waive any qualification periods which may exist with respect
to such benefit plans and programs.

4.5        Vacation.
Nobles shall be entitled to four (4) calendar
weeks vacation leave during each year that this Agreement is in effect at the
Base Salary provided for in Section 4.1. Such vacation shall be taken at such
time or times as the Corporations may determine having regard to the business
and undertaking of the Corporations. In the event Nobles employment is
terminated, Nobles shall be entitled to pro-rated vacation pay for the portion
of the year that he has been actively employed.

4.6        Relocation
Package and Commuting Expenses. For a period of time not to
exceed twelve (12)-months from the Effective Start Date, prior to RAS
determining the future location of its corporate headquarters and while Nobles
will maintain residence in Dallas and offices in Buffalo and Dallas, the
Corporations shall provide:

(a)     expense reimbursement for hotel accommodation while visiting the Buffalo office
or at Nobles request, expense reimbursement for rental of a furnished
apartment in the Buffalo area, which reimbursement shall not exceed $2,000 per
month; and

(b)     expense reimbursement for a regular weekly flight between Dallas and Buffalo, or
similar flight arrangements for Mrs. Nobles to travel to Buffalo from Dallas, which
reimbursement shall not exceed $3,500 per month. The Corporations will provide
an automobile while Nobles is visiting the Buffalo office. It is understood that
Nobles will use his best efforts to coordinate his Buffalo/Dallas travel with
other RAS-related business travel to limit the expense and less productive time
spent commuting.

Additionally, in the event
Nobles shall be required to relocate his household to Buffalo or another
location, the Corporations shall reimburse Nobles for normal and reasonable
relocation expenses including costs associated with the sale of Nobles
Dallas home, fees related to the purchase of a new home in the new location,
transportation of family and household goods and temporary living expenses.

4.7        Automobile.
Upon Nobles relocation to RASs
corporate headquarters and during the remaining term of his employment with the
Corporations, the Corporations shall either provide Nobles with an automobile or
provide Nobles with an automobile allowance equal to $750.00 per month for
capital costs and insurance. All other automobile expenses will be provided on
the same basis as other Senior Management of the Corporations.

4.8        Expenses.
 During the term of his employment with the
Corporations and other than as set forth in Sections 4.6 and 4.7, Nobles shall
be reimbursed for all reasonable travel and business expenses, including long
distance charges associated with the use of a mobile telephone, personal
computer costs, business association fees, subject to such limitations as may be
established by the Board of Directors of the Corporations and revised by them
from time to time. As a condition to the reimbursement of such expenses, Nobles
shall be required to account to the Corporations for such expenses in the manner
prescribed by the Corporations.

ARTICLE 5TERMINATION OF EMPLOYMENT

5.1        Terms and Conditions.  Subject to Section 9.10, this Agreement and the employment contemplated
hereunder may be terminated in the following manner and in the following
circumstances:

1. by the Corporations, at any time, for cause, in which case Nobles' employment shall
terminate immediately upon receipt of written notice from the Corporations to Nobles
setting out the cause for termination, and in such event the Corporations shall
pay to Nobles his Base Salary up to the date of termination. Cause
shall be limited to, (i) gross negligence or a willful act of misfeasance or
malfeasance in respect of the duties and responsibilities assigned to Nobles;
(ii) willful violation of the Corporations policy or code of conduct
adopted by the Board of Directors of the Corporations
prior to the date of any alleged violations; or (iii) final judgment convicting
Nobles of an indictable offense under criminal statute;
2. by the Corporations, upon the death of Nobles, in which case his employment
pursuant to this Agreement shall terminate on the date of death;
3. by the Corporations, if Nobles is unable to discharge his duties hereunder by reason
of illness, disease, mental or physical disability or otherwise, for an aggregate
of six (6) months in any one (1) year, whether or not consecutive, in which case
his employment pursuant to this Agreement shall terminate upon receipt of
written notice from the Corporations to Nobles which written notice shall set
forth the calculation of the six (6) month period and its asserted bases for the
determination of Nobles inability to discharge his duties;
4. by the Corporations, for any reason other than in 5.1 (a) (b) or (c) and at any time
upon payment to Nobles of the Termination Payments provided for in Section 5.2;
5. by Nobles, upon 90 days' prior written notice to the Corporations; or
6. by Nobles, in the event of a Change of Control, upon 30 days' prior written notice
to the Corporations.

5.2        Termination Payments.  If Nobles' employment with the Corporations is terminated
pursuant to Subsection 5.1 (d), the Corporations shall make the following payments to Nobles (the
"Termination Payments"):

1. if terminated within the first two (2) years of this Agreement, pay to Nobles a
severance payment equal to the Base Salary for one year plus the incentive compensation
described in Section 4.2 due or which would become due for the year in which the
termination occurs, if any, under the Incentive Compensation Program provided in
Section 4.2; or
2. if terminated in the final year of this Agreement, pay to Nobles a severance payment
equal to the remaining Base Salary plus a pro-rated portion of the incentive
compensation described in Section 4.2 due or which would become due for the
final year under the Incentive Compensation Program provided in Section 4.2.

The amounts of any payments
owed to Nobles by the Corporations pursuant to this Section arising under the
Incentive Compensation Program provided in Section 4.2 will be calculated and
paid by the Corporations within 120 days of the close of the Corporations
fiscal year.

5.3        Release of
Claims. Upon termination of this Agreement for any reason, the
employment of Nobles shall be wholly terminated and this Agreement shall cease
to have any further effect save and except in respect of Sections 6, 7 and 8
which shall continue in full force and effect. Upon any such termination, Nobles
shall have no claim against the Corporations for damages, termination pay,
severance pay, pay in lieu
of notice of termination, statutory or otherwise, except in respect of payment
of remuneration earned, due and owing to the effective date of termination plus
any amount payable under Section 5.2.

5.4        Reasonableness.
 The parties hereto acknowledge and agree
that there are no implied rights whatsoever with respect to the termination of
this Agreement and employment contemplated hereunder. The parties further
acknowledge and agree that if any of the payments referred to in Section 5.2 are
made, such payments constitute a reasonable estimate of the damages that might
be suffered by Nobles for early termination of this Agreement, said amount being
liquidated damages and not a penalty.

5.5        Resignation on Termination. Nobles agrees that upon any
termination of his employment with the Corporations, he shall immediately tender
his resignation from any position he may hold as an officer or director of the
Corporations or any of their Subsidiaries.

ARTICLE 6CONFIDENTIALITY

6.1        Confidential Information. Nobles acknowledges that during the course
of his employment with the Corporations, he will be exposed to secret and
confidential business information belonging to the Corporations which gives the
Corporations a commercial advantage over others. Except as may be required by
law, Nobles agrees to not use, directly or indirectly, for his own account or
for the account of any person, firm, corporation or other entity or disclose to
any person, firm, corporation or other entity, the Corporations
proprietary information disclosed or entrusted to him or developed or generated
by him in the performance of his duties hereunder, including, but not limited
to, information relating to the Corporations organizational structure,
operations, business plans, technical projects, pricing data, business costs,
research data results, inventions, trade secrets, customer lists or other work
produced, developed by or for the Corporations, whether on the premises of the
Corporations or elsewhere.

6.2        Exceptions. The
provisions of Section 6.1 shall not apply to any
proprietary, confidential or secret information which is, at the commencement of
the term of this Agreement or at some later date, publicly known under
circumstances involving no breach of this Agreement.

6.3        Property
and Documents. Nobles acknowledges, understands and agrees that
all memoranda, notes, records, charts, formulae, client lists, price lists,
marketing plans, financial information and other documents made, received, held
or used by Nobles during the course of his employment by, or as a consultant to,
the Corporations, shall be the property of the Corporations and shall be
delivered by Nobles to the Corporations upon request at any time during the
course of employment and upon the termination of his employment as hereinbefore
provided. With respect to all Confidential Information and other documents of
the Corporations held by Nobles, Nobles acknowledges that he is in a position of
trust and subject to a fiduciary duty to use the information only in the
interests of the Corporations and each of their business.

ARTICLE 7NON-COMPETITION AND NON-SOLICITATION

7.1        Non-Competition. Nobles covenants and agrees that, except on behalf of
and for the benefit of the Corporations or any of their Subsidiaries, he shall
not (without the prior written consent of the Corporations, such consent not to
be unreasonably withheld), while in the employ of the Corporations and (i) if
Nobles terminated his employment or is terminated by the Corporations for cause,
then during the Applicable Time Period or (ii) if Nobles is terminated by the
Corporations other than for cause, then during the period for which Nobles
receives termination payments pursuant to Subsection 5.2(a) or (b), either
individually or in partnership or in conjunction with any Person as employee,
employer, principal, agent, joint venture, partner, shareholder or other equity
holder, independent contractor, licensor, licensee, franchiser, franchisee,
distributor, consultant, supplier, trustee or by or through any corporation,
company, cooperative, partnership, trust entity with juridical personality,
unincorporated association or in any other manner whatsoever:

1. carry on or be engaged in, have any financial or other interest in or be otherwise
commercially involved in any endeavor, activity or business in all or part of the
Territory which is substantially the same as or in competition with the Business;
2. interfere or attempt to interfere with the Business or persuade or attempt to
persuade any Customer, employee or supplier of the Corporations or any of their
Subsidiaries to discontinue or alter such Persons relationship with the
Corporations or any of their Subsidiaries;
3. directly or indirectly, canvas, solicit or attempt to solicit, accept or supply goods
or services to any Customer, except on behalf of and for the benefit of the Corporations
or any of their Subsidiaries or except with respect to a
business not the same as or similar to the Business; or
4. employ, offer employment to or solicit the employment or engagement of or
otherwise entice away from the employment of the Corporations any individual
employed by the Corporations at the date of termination of Nobles
employment.

7.2        Exception. Provided that nothing construed herein shall
prohibit Nobles from holding for investment purposes only up to 5% of the issued
publicly traded shares of a company engaged in a business the same as or similar
to the Business presently carried on by the Corporations.

7.3        Severability. If any covenant or provision in this Article
7 is determined to be void or unenforceable in whole or in part, it shall not be
deemed to affect or impair the validity of any other covenant or provision
hereof, which provisions shall remain in full force and effect.

ARTICLE 8REASONABLENESS

8.1        Reasonableness/Equitable Remedies. Nobles agrees that all restrictions
contained in Articles 6 and 7 are reasonable and valid and all defenses to the
strict enforcement thereof by the Corporations are hereby waived. Nobles agrees
and acknowledges that his failure to comply with the covenants contained in this
Agreement shall cause the Corporations irrevocable harm and that the
Corporations shall be entitled to equitable relief, including specific
performance, an injunction, a restraining order or other equitable relief in
order to enforce such covenants, which right shall be in addition to, and not in
lieu of, any other remedy the Corporations are entitled under applicable law
(including, without limitation, monetary damages).

ARTICLE 9GENERAL

9.1        Entire
Agreement. This Agreement and the terms hereof shall constitute the entire
agreement between the parties hereto with respect to all of the matters herein
and the parties hereto acknowledge and agree that its execution has not been
induced by, nor do either of the parties hereto rely upon or regard as material,
any representations or writings whatsoever not incorporated herein and made a
part hereof. This Agreement shall not be amended, altered or qualified except by
an agreement in writing signed by both of the parties hereto. This Agreement
supersedes any prior agreements which are hereby canceled and supersedes all
previous understandings, negotiations, and representations with respect hereto,
whether oral or written.

9.2        Notice. Any notice to be given hereunder shall be given in writing and
shall be deemed to have been duly given if delivered by hand or mailed by
first-class mail, postage prepaid, return receipt requested or recognized
overnight courier service and addressed to the recipient as follows:

`(1)      To the Corporations:

                  40 Centre Drive,
                  Orchard Park, NY 14127
                  Attention:  The Chairman of the Board of Directors

         (2)      To the Employee:

                  12101 Madeleine Circle
                  Dallas, Texas 75230`

Any such notice, if mailed,
shall be deemed to have been received on the date indicated on the return
receipt and, if delivered by hand or overnight courier service, on the date of
delivery. Either party may, by notice given in accordance with the foregoing,
change his or its address for the purposes of this Agreement. In the event of a
postal strike in progress, notice shall be given only by delivery by hand or by
recognized overnight courier service operated by an entity other than the postal
entity involved in the strike. In the event of a postal strike occurring within
five (5) business days after the giving of notice by mail as hereinbefore set
out, such notice shall be deemed ineffective and thereafter, during the
continuance of the postal strike, notice shall be effective only if delivered by
hand or by recognized overnight courier service operated by an entity other than
the postal entity involved in the strike.

9.3        Arbitration. Except for the equitable remedies provided in
Article 8, any disagreement, dispute or claim arising out of or relating to this
Agreement will be settled by arbitration in accordance with the following
provisions:

1. The agreement of the parties to arbitrate covers all disputes of every kind
relating to or arising out of this Agreement or performance of the obligations outlined
in this Agreement. Disputes include actions for breach of contract with respect
to this Agreement, as well as any claim based on tort, or any other causes of
action relating to performance of the obligations outlined in this Agreement
such as claims based on an allegation of fraud or misrepresentation and claims
based on a federal or state statute. In addition, the arbitrators selected
according to the procedures set forth below will determine the arbitrability of
any matter brought to them, and their decision will be binding on the parties.
2. The forum for arbitration is Erie County, New York, or the county and state
of the location of the corporate headquarters of RAS if RAS is no longer located in
Erie County, New York at the time any dispute arises.
3. The number of arbitrators will be three (3), unless the parties agree on a
single arbitrator. In the absence of agreement on a single arbitrator, within 30 days
after the initiation of an arbitration proceeding, each party will select one
arbitrator and those two arbitrators will then select within 30 days a third
arbitrator. If those two arbitrators are unable to select a third arbitrator
within the 30 day period, a third arbitrator will be appointed by the commercial
panel of the American Arbitration Association. The decision in writing of at least
two (2) of the three (3) arbitrators will be final and binding upon the parties.
4. Arbitration will be administered by the American Arbitration Association.
5. Rules of arbitration will be the Commercial Arbitration Rules of the
American Arbitration Association (the Rules), except that each party will
have the right to conduct discovery in any manner and to the extent authorized
by the Federal Rules of Civil Procedure as interpreted by the federal courts.
The parties may further modify the Rules by mutual agreement. In the event of
any conflict between the Commercial Arbitration Rules and the provisions of this
Section, the provisions of this Section will prevail. The arbitrators may not
modify the terms of this Agreement.
6. The arbitrators have the power and authority to award any remedy or
judgment that could be awarded by a court of law in the jurisdiction. The award rendered
by arbitration will be final and binding upon the parties, and judgment upon the
award may be entered in any court of competent jurisdiction in the United
States.

9.4        Further Assurances. The parties hereto and each of them hereby consent
and agree to do such things, attend such meetings and to execute such further
documents and assurances as may be deemed necessary or advisable from time to
time in order to carry out the terms and conditions of this Agreement in
accordance with its true intent.

9.5        Waivers. No
waiver of any breach or default or any of the
provisions hereof shall be effective unless in writing and signed by the party
to be charged with such waiver. No waiver shall be deemed a continuing waiver or
waiver in respect of any subsequent breach or default, either of a similar or
different nature, unless expressly so stated in writing.

9.6        Severability. If any provision of this Agreement is
determined to be illegal or unenforceable, in whole or in part, such illegal or
unenforceable provision or part thereof, shall be severable from this Agreement
and shall not affect the remaining provisions hereof.

9.7        Headings. The
insertion of headings and the division of
this Agreement into Sections and Subsections is for convenience of reference
only and shall not affect the interpretation hereof.

9.8        Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs, executors, legal
personal representatives, successors and permitted assigns; provided, however,
that this Agreement may not be assigned by Nobles.

9.9        Governing Law.  This Agreement shall be governed by and interpreted and enforced in
accordance with the laws of New York, without regard to principles of conflicts of law, except as
otherwise provided herein.

9.10        Survival. The
provisions of Articles 6, 7 and 8 shall survive the termination of this Agreement.

9.11        Independent Legal Advice. Nobles hereby represents and
warrants to the Corporations that he had the opportunity to seek and was not
prevented nor discouraged by the Corporations from seeking independent legal
advice prior to the execution of this Agreement and that, in the event that he
did not avail himself of that opportunity prior to signing this Agreement, he
did so voluntarily without any undue pressure and agrees that his failure to
obtain independent legal advice shall not be used by him as a defense to the
enforcement of his obligations under this Agreement.

IN WITNESS WHEREOF the
parties have caused this Agreement to be executed
with effect as of the date first above written.

`RADIANT ENERGY CORPORATION

                                                     Per:________________________________


                                                     Per:________________________________


                                                     RADIANT AVIATION SERVICES, INC.


                                                     Per:________________________________


                                                     Per:________________________________

SIGNED, SEALED AND DELIVERED                         )
IN THE PRESENCE OF:                                  )
                                                     )
                                                     )
                                                     )
                                                     )
_________________________________                    ____________________________________
WITNESS                                                       Bruce Nobles`