Document:

EXHIBIT 4.4

                                 PROMISSORY NOTE

$22,000.00                                                       April 15, 1997

For value received,  the undersigned  MariCulture Systems, Inc. (the "Promisor")
promises to pay to the order of William Evans,  (the "Payee") at 17007 35th Ave.
SE,  Bothell,  Washington  98012,  (or at such  other  place  as the  Payee  may
designate  in writing)  the sum of $ 22,000.00  with  interest  from January 30,
1997, on the unpaid principal at the rate of ten percent (10.00%) annually.

The unpaid principal shall be payable on December 15, 1997.

All payments on this Note shall be applied first in payment of accrued  interest
and any remainder in payment of principal.

If any payment  obligation  under this Note is not paid when due,  the  Promisor
promises to pay all costs of  collection,  including  reasonable  attorney fees,
whether or not a lawsuit is commenced as part of the collection process.

The Promisor agrees to pay a portion of all monies received from investors until
the full amount is repaid. This amount shall not be less than 15% of the amounts
received from investors.

If any  one or  more  of the  provisions  of  this  Note  are  determined  to be
unenforceable,  in whole or in part,  for any reason,  the remaining  provisions
shall remain fully operative.

All payments of  principal  and interest on this Note shall be paid in the legal
currency of the United States. Promisor waives presentment for payment, protest,
and notice of protest and nonpayment of this Note.

No renewal or extension of this Note,  delay in enforcing any right of the Payee
under this Note,  or assignment by Payee of this Note shall affect the liability
of the Promisor.  All rights of the Payee under this Note are cumulative and may
be exercised concurrently or consecutively at the Payee's option.

This  Note  shall be  construed  in  accordance  with  the laws of the  State of
Washington.

Signed this 15th day of April, 1997, at Lynnwood, Washington.

By:  /s/ David E. Meilahn
    -------------------------                              Initials:-------
    MariCulture Systems, Inc.
    PresidentEXHIBIT 4.5

Offering Circular                                                  Confidential
Dated July 12, 1996

                            MARICULTURE SYSTEMS, INC.
                             (A Florida Corporation)

                                 985, 000 Shares

                          At A Price of $1.00 Per Share

         MARICULTURE  SYSTEMS, INC., a  Florida  corporation (the "Company"), is
engaged  in  the  business  of  developing  and  marketing   products  based  on
proprietary,  state-of-the-art,  aquiculture  technology.  The  Company  has  no
earnings to date.  There is no assurance  that the Company will be successful or
profitable in the future.

         The  Company's  principal  place office is located at 21300 68th Avenue
West, Suite 203, Lynwood, WA 98036.

         AN INVESTMENT IN THE COMPANY IS SPECULATIVE  AND INVOLVES A HIGH DEGREE
OF RISK.  INVESTMENT  IN THE  SECURITIES  OFFERED  HEREBY IS  SUITABLE  ONLY FOR
PERSONS  OF  SUBSTANTIAL  FINANCIAL  MEANS WHO CAN  AFFORD A TOTAL LOSS OF THEIR
INVESTMENT AND WILL BE SOLD ONLY TO ACCREDITED OR OTHERWISE QUALIFIED INVESTORS.
FOR A DISCUSSION OF THE MATERIAL  RISKS IN  CONNECTION  WITH THE PURCHASE OF THE
SHARES, SEE "INVESTMENT RISK CONSIDERATIONS".

         The  SECURITIES  ARE  BEING  OFFERED  WITHOUT  REGISTRATION  UNDER  THE
SECURITIES  ACT OF 1933, AS AMENDED (The "ACT"),  IN RELIANCE UPON The EXEMPTION
FROM  REGISTRATION  AFFORDED BY SECTIONS 4(2) AND 3(b) OF The SECURITIES ACT AND
REGULATION D PROMULGATED THEREUNDER.

         THIS MEMORANDUM HAS NOT BEEN REVIEWED OR APPROVED OR  DISAPPROVED,  NOR
HAS The  ACCURACY OR ADEQUACY OF THE  INFORMATION  SET FORTH  HEREIN BEEN PASSED
UPON  BY  The  SECURITIES  AND  EXCHANGE  COMMISSION  OR  ANY  STATE  SECURITIES
ADMINISTRATOR.  ANY  REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.  THIS
OFFERING IS BEING MADE PURSUANT TO THE  EXEMPTIONS  AFFORDED BY SECTIONS 4(2) OR
3(b) OF THE  SECURITIES  ACT OF 1933 AND RULE 504 OF  REGULATION  D  PROMULGATED
THEREUNDER AND STATE SMALL CORPORATE OFFERING REGISTRATION PROVISIONS.  PURSUANT
TO RULE 504,  THE SHARES SOLD HEREBY WILL NOT BE SUBJECT TO ANY  LIMITATIONS  ON
RESALE  THEREOF  UNDER  FEDERAL  LAW.  THE SHARES  MAY,  HOWEVER,  BE SUBJECT TO
LIMITATIONS  ON THE OFFER AND SALE AND THE RESALE OF THE  SHARES  IMPOSED BY The
BLUE SKY LAWS OF INDIVIDUAL STATES. IN ADDITION, The COMPANY INTENDS TO FILE THE
REQUIRED  DOCUMENTS IN CERTAIN  OTHER STATES  IDENTIFIED BY MANAGEMENT AS HAVING
POSSIBLE  INVESTOR  INTEREST  AND USE ITS BEST EFFORTS TO QUALIFY The SHARES FOR
SECONDARY TRADING IN SUCH STATES,  THOUGH NO ASSURANCE CAN BE GIVEN THAT IT WILL
BE ABLE TO QUALIFY The SHARES FOR SECONDARY  TRADING IN ANY SUCH STATES IN WHICH
IT SUBMITS SUCH  APPLICATIONS AND DOCUMENTS.  AN INABILITY TO QUALIFY The SHARES
FOR SECONDARY TRADING WILL CREATE SUBSTANTIAL RESTRICTION ON The TRANSFERABILITY
OF SUCH SHARES  WHICH MAY NEGATE The BENEFIT OF The  EXEMPTION  PROVIDED BY RULE
504 OF REGULATION  D. SEE "RISK  FACTORS." THE COMPANY WILL USE ITS BEST EFFORTS
TO CAUSE The SHARES TO BE LISTED ON THE  ELECTRONIC  BULLETIN  BOARD OPERATED BY
The NATIONAL  ASSOCIATION OF SECURITIES DEALERS,  INC. AS A MARKET IN WHICH THEY
MAY BE TRADED.  THERE IS NO ASSURANCE THAT SUCH LISTING WILL BE OBTAINED OR THAT
IF A LISTING IS  OBTAINED  THAT ANY MARKET FOR THE SHARES  WILL  DEVELOP,  OR IF
DEVELOPED, THAT IT WILL BE SUSTAINED.

                                        1

<PAGE>

        ----------------------------------------------------------------

                  Subscription                             Proceeds to the
                  Price              Commissions(1)        Company

Per Share         $1.00              $ -0-                 $ 985,000

(1) The Shares are being  sold by the  Company  Officers  and  Directors  and no
commissions will be paid to them in connection with the Offering.

                                        2

<PAGE>

                            MARICULTURE SYSTEMS, INC.
                               Post Office Box 968
                                  Lake Stevens,
                                Washington 98258

                            CONFIDENTIAL INFORMATION

         THE INFORMATION  CONTAINED IN THIS OFFERING  MEMORANDUM IS CONFIDENTIAL
AND PROPRIETARY TO THE COMPANY AND IS BEING  SUBMITTED TO PROSPECTIVE  INVESTORS
IN THE  COMPANY  SOLELY FOR SUCH  INVESTORS'  CONFIDENTIAL  USE WITH THE EXPRESS
UNDERSTANDING  THAT, WITHOUT THE PRIOR WRITTEN  PERMISSION OF THE COMPANY,  SUCH
PERSONS  WILL NOT RELEASE  THIS  DOCUMENT OR DISCUSS THE  INFORMATION  CONTAINED
HEREIN OR MAKE REPRODUCTIONS OF OR USE THIS OFFERING  MEMORANDUM FOR ANY PURPOSE
OTHER THAN EVALUATING A POTENTIAL INVESTMENT IN THE SHARES.

         A  PROSPECTIVE   INVESTOR,  BY  ACCEPTING  DELIVERY  OF  THIS  OFFERING
MEMORANDUM,  AGREES  PROMPTLY TO RETURN TO THE COMPANY THIS OFFERING  MEMORANDUM
AND ANY OTHER  DOCUMENTS OR INFORMATION  FURNISHED IF THE  PROSPECTIVE  INVESTOR
ELECTS NOT TO PURCHASE ANY OF THE SHARES OFFERED HEREBY.

         THE INFORMATION  PRESENTED  HEREIN WAS PREPARED BY THE COMPANY IS BEING
FURNISHED BY THE COMPANY SOLELY FOR USE BY  PROSPECTIVE  INVESTORS IN CONNECTION
WITH THE  OFFERING  NOTHING  CONTAINED  HEREIN  IS,  OR SHOULD BE RELIED ON AS A
PROMISE OR REPRESENTATION AS TO THE FUTURE PERFORMANCE OF THE COMPANY.

         THIS OFFERING  MEMORANDUM  DOES NOT PURPORT TO BE  ALL-INCLUSIVE  OR TO
CONTAIN  ALL  THE  INFORMATION  THAT  A  PROSPECTIVE   INVESTOR  MAY  DESIRE  IN
INVESTIGATING  THE  COMPANY.  EACH  INVESTOR  MUST  CONDUCT  AND RELY ON ITS OWN
EVALUATION  OF THE COMPANY AND THE TERMS OF THE  OFFERING,  INCLUDING THE MERITS
AND RISKS INVOLVED.  IN MAKING AN INVESTMENT DECISION WITH RESPECT TO THE SHARES
SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED
IN CONNECTION WITH THE PURCHASE OF SHARES.

         THIS  OFFERING  MEMORANDUM  DOES NOT  CONSTITUTE  AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE SHARES IN ANY JURISDICTION  WHERE, OR TO ANY
PERSON TO WHOM,  IT IS  UNLAWFUL  TO MAKE  SUCH  OFFER OR  SOLICITATION  IN SUCH
JURISDICTION.  EXCEPT AS OTHERWISE INDICATED, THIS OFFERING MEMORANDUM SPEAKS AS
OF THE DATE HEREOF.  NEITHER THE DELIVERY OF THIS  OFFERING  MEMORANDUM  NOR ANY
SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,  CREATE ANY IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY AFTER THE DATE HEREOF.

         NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY  INFORMATION  OTHER THAN THAT
CONTAINED  IN THIS  OFFERING  MEMORANDUM,  OR TO  MAKE  ANY  REPRESENTATIONS  IN
CONNECTION  WITH THE  OFFERING  MADE HEREBY,  AND, FI GIVEN OR MADE,  SUCH OTHER
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE  COMPANY.  THE COMPANY  DISCLAIMS  IN, OR OMISSION  FROM,  THIS  OFFERING
MEMORANDUM  OR ANY  OTHER  WRITTEN  OR ORAL  COMMUNICATION  TRANSMITTED  OR MADE
AVAILABLE TO THE RECIPIENT.

                                        3

<PAGE>

FOR RESIDENT OF ALL STATES:

         THE SHARES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OR THE  SECURITIES  LAWS OF ANY  STATE  AND ARE  BEING  OFFERED  AND SOLD IN
RELIANCE ON EXEMPTIONS FROM THE REGISTRATION  REQUIREMENTS OF THE SECURITIES ACT
AND SUCH LAWS. THE SHARES ARE SUBJECT TO RESTRICTIONS ON THE TRANSFERABILITY AND
RESALE  AND MAY NOT BE  TRANSFERRED  OR  RESOLD  EXCEPT AS  PERMITTED  UNDER THE
SECURITIES ACT AND SUCH LAWS PURSUANT TO  REGISTRATION  OR EXEMPTION  THEREFROM.
THE SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES
AND EXCHANGE  COMMISSION.  ANY STATE  SECURITIES  COMMISSION OR OTHER REGULATORY
AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE
MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THIS OFFERING MEMORANDUM.
ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

                                        4

<PAGE>

                        NOTICES TO PROSPECTIVE INVESTORS

         THIS OFFERING  MEMORANDUM IS SUBMITTED IN CONNECTION  WITH THE OFFERING
OF THE  SHARES  AND MAY NOT BE  REPRODUCED  OR USED FOR ANY  OTHER  PURPOSE.  BY
ACCEPTING DELIVERY OF THIS OFFERING MEMORANDUM,  EACH RECIPIENT AGREES TO RETURN
THIS OFFERING MEMORANDUM AND ALL OTHER DOCUMENTS IF THE RECIPIENT DOES NOT AGREE
TO PURCHASE ANY OF THE SHARES TO THE COMPANY AT ITS ADDRESS  LISTED ON THE COVER
OF THE OFFERING MEMORANDUM.

         THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON THE TRANSFERABILITY AND
RESALE  AND  MAY  NOT BE  TRANSFERRED  OR  RESOLD  EXCEPT  AS  PERMITTED  BY THE
SECURITIES ACT OF 1933, AS AMENDED,  AND THE APPLICABLE  STATE  SECURITIES LAWS.
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM,  INVESTORS SHOULD BE AWARE THAT
THEY WILL BE  REQUIRED TO BEAR THE  FINANCIAL  RISKS OF THIS  INVESTMENT  FOR AN
INDEFINITE PERIOD OF TIME.

         IN  MAKING AN  INVESTMENT  DECISION,  INVESTORS  MUST RELY ON THEIR OWN
EXAMINATION OF THE PERSON OR ENTITY CREATING THE SECURITIES AND THE TERMS OF THE
OFFERING,  INCLUDING THE MERITS AND RISKS  INVOLVED.  THESE  SECURITIES HAVE NOT
BEEN  RECOMMENDED  BY ANY FEDERAL OR STATE  SECURITIES  COMMISSION OR REGULATORY
AUTHORITY.  FURTHERMORE,  THE  FOREGOING  AUTHORITIES  HAVE  NOT  CONFIRMED  THE
ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT.  ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

         THIS OFFERING  MEMORANDUM  DOES NOT  CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO PURCHASE SHARES TO ANY PERSON IN ANY STATE OR IN ANY
JURISDICTION IN WHICH SUCH AN OFFER OR SOLICITATION IS UNLAWFUL,  SUBJECT TO THE
PRECEDING  SENTENCE.  THIS OFFERING MEMORANDUM IS INTENDED FOR THE EXCLUSIVE USE
OF THE PERSON TO WHOM IT IS DELIVERED BY AN  AUTHORIZED  AGENT OF THE COMPANY ON
BEHALF OF THE COMPANY.

         PROSPECTIVE  INVESTORS  ARE  NOT  TO  CONSTRUE  THE  CONTENTS  OF  THIS
CONFIDENTIAL  OFFERING  MEMORANDUM OR ANY PRIOR OR SUBSEQUENT  COMMUNICATIONS AS
LEGAL, TAX OR INVESTMENT  ADVICE.  EACH INVESTOR SHOULD CONSULT HIS OWN COUNSEL,
ACCOUNTANT OR BUSINESS ADVISOR AS TO LEGAL, TAX AND RELATED MATTERS COVERING HIS
INVESTMENT.

         THE SHARES ARE  OFFERED  SUBJECT TO THE  ACCEPTANCE  BY THE  COMPANY OF
OFFERS BY PROSPECTIVE  INVESTORS,  ALLOCATION OF SHARES BY THE COMPANY AND OTHER
CONDITIONS  SET FORTH  HEREIN.  THE  COMPANY MAY REJECT ANY OFFER IN WHOLE OR IN
PART AND NEED NOT ACCEPT OFFERS IN THE ORDER RECEIVED.

         THIS  CONFIDENTIAL  OFFERING  MEMORANDUM  DOES NOT  CONTAIN  AN  UNTRUE
STATEMENT OF A MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT  NECESSARY TO MAKE
THE STATEMENTS  MADE IN LIGHT OF THE  CIRCUMSTANCES  UNDER WHICH THEY WERE MADE,
NOT  MISLEADING.  IT CONTAINS A FAIR SUMMARY OF THE MATERIAL  TERMS AND DOCUMENT
PURPORTED TO BE SUMMARIZED HEREIN.

         THE SHARES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED,  OR THE SECURITIES LAWS OF CERTAIN STATES AND ARE BEING
OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF
SAID ACT AND SUCH  LAWS.  THE  SHARES  UNDERLYING  THE  SHARES  ARE  SUBJECT  TO
RESTRICTIONS ON TRANSFERABILITY  AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED  UNDER SAID ACT AND SUCH LAWS  PURSUANT TO  REGISTRATION  OR
EXEMPTION  THEREFROM.  THE SHARES HAVE NOT BEEN APPROVED OR  DISAPPROVED  BY THE
SECURITIES AND EXCHANGE COMMISSION OR OTHER REGULATORY  AUTHORITY,  NOR HAVE ANY
OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING
OR THE

                                        5

<PAGE>

ACCURACY OR ADEQUACY OF THE OFFERING MEMORANDUM.  ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.

         THE  SUBSCRIPTION  PRICE  FOR  THE  SHARES  IS  PAYABLE  IN  FULL  UPON
SUBSCRIPTION.  THE OFFERING PRICE WAS DETERMINED  ARBITRARILY BY THE COMPANY AND
BEARS NO RELATIONSHIP TO ASSETS,  EARNINGS,  BOOK VALUE OR ANY OTHER CRITERIA OF
VALUE. NO  REPRESENTATION IS MADE THAT THE SHARES HAVE MARKET VALUE OF, OR COULD
BE RESOLD AT, THAT PRICE (SEE "RISK FACTORS," "DILUTION," AND "USE OF PROCEEDS).

         THE SHARES WILL BE OFFERED BY THE COMPANY ON A BEST EFFORTS  BASIS TO A
SELECT GROUP OF INVESTORS WHO MEET CERTAIN SUITABILITY STANDARDS. NO COMMISSIONS
AND NO NON-ACCOUNTABLE OR ACCOUNTABLE EXPENSE ALLOWANCE OF ANY KIND WILL BE PAID
FROM OR DEDUCTED FROM THE PROCEEDS  RAISED  HEREBY.  THE COMPANY WILL ABSORB ALL
MARKETING EXPENSES ASSOCIATED WITH THIS OFFERING 9SEE "USE OF PROCEEDS").

         THE  COMPANY HAS AGREED TO PROVIDE,  PRIOR TO THE  CONSUMMATION  OF THE
TRANSACTIONS  CONTEMPLATED HEREIN, TO EACH POTENTIAL PURCHASER OF SECURITIES (OR
HIS  REPRESENTATIVES)  OR BOTH) THE OPPORTUNITY TO ASK QUESTIONS OF, AND RECEIVE
ANSWERS  FROM,  THE COMPANY OR ANY PERSON  ACTING ON ITS BEHALF  CONCERNING  THE
TERMS AND CONDITIONS OF THIS OFFERING AND TO OBTAIN ANY ADDITIONAL  INFORMATION,
TO  THE  EXTENT  THEY  POSSESS  SUCH  INFORMATION  OR  CAN  ACQUIRE  IT  WITHOUT
UNREASONABLE  EFFORT  OR  EXPENSE  NECESSARY  TO  VERIFY  THE  ACCURACY  OF  THE
INFORMATION SET FORTH HEREIN.

         THIS OFFERING MEMORANDUM DOES NOT CONSTITUTE AN OFFER TO ANY PERSON WHO
DOES NOT MEET THE SUITABILITY  STANDARDS DESCRIBED HEREIN.  REPRODUCTION OF THIS
OFFERING MEMORANDUM IS STRICTLY PROHIBITED.

         NO  PERSON  IS  AUTHORIZED  TO GIVE  ANY  INFORMATION  OR TO  MAKE  ANY
REPRESENTATION  NOT CONTAINED IN THIS OFFERING  MEMORANDUM EXCEPT AS NOTED ABOVE
WITH REGARD TO QUESTIONS ASKED OF THE COMPANY AND OF THOSE  AUTHORIZED TO ACT ON
ITS BEHALF.  NO OFFERING  LITERATURE OR ADVERTISING  HAS BEEN  AUTHORIZED BY THE
COMPANY  EXCEPT  THE   INFORMATION   CONTAINED   HEREIN.   ANY   INFORMATION  OR
REPRESENTATION  NOT  CONTAINED  HEREIN  MUST NOT BE RELIED  UPON AS HAVING  BEEN
AUTHORIZED  BY THE COMPANY OR ITS  OFFICERS AND  DIRECTORS.  EXCEPT AS OTHERWISE
INDICATED,  THIS  OFFERING  MEMORANDUM  SPEAKS AS OF THE DATE ON THE COVER  PAGE
NEITHER THE DELIVERY OF THIS  OFFERING  MEMORANDUM  NOR ANY SALE MADE  HEREUNDER
SHALL,  UNDER ANY  CIRCUMSTANCES,  CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE  COMPANY  SINCE THE  RESPECTIVE  DATES AT WHICH THE
INFORMATION IS GIVEN HEREIN OR THE DATE HEREOF.

         ANY UNSOLD SHARES MAY BE PURCHASED BY THE COMPANY OR ITS  AFFILIATES ON
THE SAME TERMS AS SHARES PURCHASED BY OTHER INVESTORS.

                     NOTICES TO RESIDENTS OF CERTAIN STATES

                           NOTICE TO ALABAMA RESIDENTS

         THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
ALABAMA  SECURITIES ACT. A REGISTRATION  STATEMENT  RELATING TO THESE SECURITIES
HAS NOT BEEN FILED WITH THE ALABAMA SECURITIES  COMMISSION.  THE COMMISSION DOES
NOT RECOMMEND OR ENDORSE THE PURCHASE OF ANY  SECURITIES,  NOR DOES IT PASS UPON
THE ACCURACY OR COMPLETENESS OF THIS OFFERING MEMORANDUM.  ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.

         ANYTHING TO THE CONTRARY HEREIN NOTWITHSTANDING, THE INVESTMENT OF AN
ALABAMA  PURCHASER  WHO IS NOT AN ACCREDIT  INVESTOR MAY NOT EXCEED TWENTY (20%)
PER CENT OF SUCH  PURCHASER'S  NET  WORTH,  EXCLUSIVE  OF  PRINCIPAL  RESIDENCE,
FURNISHINGS AND AUTOMOBILES.

                                        6

<PAGE>

                           NOTICE TO ALASKA RESIDENTS

         THESE SECURITIES HAVE NOT BEEN REGISTERED  UNDER THE ALASKA  SECURITIES
ACT AND MAY  NOT BE  SOLD  WITHOUT  REGISTRATION  UNDER  THAT  ACT OR  EXEMPTION
THEREFROM.

                           NOTICE TO ARIZONA RESIDENTS

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE ARIZONA  SECURITIES
ACT AND ARE BEING  SOLD IN  RELIANCE  UPON THE  EXEMPTION  CONTAINED  IN SECTION
44-184(1) OF SUCH ACT.  THESE  SECURITIES  MAY NOT BE SOLD WITHOUT  REGISTRATION
UNDER SUCH ACT OR EXEMPTION THEREFROM.

         ARIZONA  RESIDENTS MUST HAVE EITHER (i) A MINIMUM NET WORTH OF AT LEAST
SEVENTY FIVE THOUSAND  ($75,000)  DOLLARS  (EXCLUDING HOME, HOME FURNISHINGS AND
AUTOMOBILES)  AND A  MINIMUM  ANNUAL  GROSS  INCOME  OF  SEVENTY  FIVE  THOUSAND
(475,000)  DOLLARS;  OR (iii) A NET WORTH OF AT LEAST TWO  HUNDRED  TWENTY  FIVE
THOUSAND ($225,000) DOLLARS (AS COMPUTED ABOVE).

                          NOTICE TO ARKANSAS RESIDENTS

         THESE  SECURITIES  ARE OFFERED  PURSUANT TO A CLAIM OF EXEMPTION  UNDER
SECTION  14(b)(14)  OF THE  ARKANSAS  SECURITIES  ACT  AND  SECTION  4(2) OF THE
SECURITIES ACT OF 1933. A REGISTRATION  STATEMENT  RELATING TO THESE  SECURITIES
HAS NOT  BEEN  FILED  WITH  THE  ARKANSAS  SECURITIES  DEPARTMENT  OR  WITH  THE
SECURITIES  AND EXCHANGE  COMMISSION.  NEITHER THE DEPARTMENT NOR THE COMMISSION
HAS PASSED UPON THE VALUE OF THESE SECURITIES,  MADE ANY  RECOMMENDATIONS  AS TO
THEIR  PURCHASE,  APPROVED  OR  DISAPPROVED  THE  OFFERING,  OR PASSED  UPON THE
ADEQUACY OR ACCURACY OF THIS  OFFERING  MEMORANDUM.  ANY  REPRESENTATION  TO THE
CONTRARY IS UNLAWFUL.

         NOTWITHSTANDING  ANYTHING TO THE CONTRARY  HEREIN,  AN  INVESTMENT BY A
NON- ACCREDITED  INVESTOR MAY NOT EXCEED TWENTY (20%) PER CENT OF THE INVESTOR'S
NET WORTH AT THE TIME OF PURCHASE, ALONE OR JOINTLY WITH SPOUSE.

                         NOTICE TO CALIFORNIA RESIDENTS

         IF THE COMPANY ELECTS TO SELL SHARES IN THE STATE OF CALIFORNIA,  IT IS
UNLAWFUL TO  CONSUMMATE  A SALE OR TRANSFER  OF THE  SHARES,  OR OTHER  INTEREST
THEREIN,  OR TO RECEIVE ANY  CONSIDERATION  THEREFOR  WITHOUT THE PRIOR  WRITTEN
CONSENT OF THE  COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA,  EXCEPT
AS PERMITTED IN THE COMMISSIONER'S RULES.

                         NOTICE TO CONNECTICUT RESIDENTS

         THESE  SECURITIES  HAVE  NOT  BEEN  REGISTERED  UNDER  THE  CONNECTICUT
SECURITIES  ACT  AND MAY NOT BE SOLD  OR  TRANSFERRED  WITHOUT  REGISTRATION  OR
EXEMPTION THEREFROM.

                          NOTICE TO DELAWARE RESIDENTS

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE DELAWARE SECURITIES
ACT  AND  MAY  NOT BE SOLD OR  TRANSFERRED  WITHOUT  REGISTRATION  OR  EXEMPTION
THEREFROM.

                                        7

<PAGE>

                           NOTICE TO FLORIDA RESIDENTS

         THE SHARES  REFERRED  TO HEREIN WILL BE SOLD TO, AND  ACQUIRED  BY, THE
HOLDER IN A TRANSACTION  EXEMPT UNDER SECTION 517.061 OF THE FLORIDA  SECURITIES
ACT. THE SHARES HAVE NOT BEEN REGISTERED UNDER SAID ACT IN THE STATE OF FLORIDA.
IN  ADDITION,  ALL FLORIDA  RESIDENTS  SHALL HAVE THE  PRIVILEGE  OF VOIDING THE
PURCHASE WITHIN THREE (3) DAYS AFTER THE FIRST TENDER OF  CONSIDERATION  IS MADE
BY SUCH PURCHASER TO THE ISSUER,  AN AGENT OF THE ISSUER,  OR AN ESCROW AGENT OR
WITHIN THREE (3) DAYS AFTER THE  AVAILABILITY  OF THAT PRIVILEGE IS COMMUNICATED
TO SUCH PURCHASER, WHICHEVER OCCURS LATER.

                           NOTICE TO GEORGIA RESIDENTS

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE GEORGIA  SECURITIES
ACT OF 1973, AS AMENDED.  IN RELIANCE UPON AN EXEMPTION  FROM  REGISTRATION  SET
FORTH  IN  SECTION  9(M)  OF  SUCH  ACT AND  THE  SECURITIES  CANNOT  BE SOLD OR
TRANSFERRED  EXCEPT IN A TRANSACTION  WHICH IS EXEMPT UNDER SUCH ACT OR PURSUANT
TO AN EFFECTIVE  REGISTRATION STATEMENT UNDER SUCH ACT OR IN A TRANSACTION WHICH
IS OTHERWISE IN COMPLIANCE WITH SAID ACT.

                            NOTICE TO IDAHO RESIDENTS

         THESE  SECURITIES  HAVE  NOT  BEEN  REGISTERED  UNDER  THE  CONNECTICUT
SECURITIES  ACT  AND MAY NOT BE SOLD  OR  TRANSFERRED  WITHOUT  REGISTRATION  OR
EXEMPTION THEREFROM.

         ANYTHING  TOT HE CONTRARY  NOTWITHSTANDING,  THE  INVESTMENT  BY A NON-
ACCREDITED  INVESTOR  MAY NOT  EXCEED TEN (10%) PER CENT OF THE  INVESTOR'S  NET
WORTH.

                           NOTICE TO INDIANA RESIDENTS

         EACH INVESTOR  PURCHASING  SHARES MUST WARRANT THAT HE HAS EITHER (i) A
NET WORTH (EXCLUSIVE OF HOME, HOME FURNISHING AND AUTOMOBILES) EQUAL TO AT LEAST
THREE (3) TIMES THE AMOUNT OF HIS  INVESTMENT BUT IN N O EVENT LESS THAN SEVENTY
FIVE THOUSAND  (475,000)  DOLLARS OR (ii) A NET WORTH  (EXCLUSIVE OF HOME,  HOME
FURNISHING AND AUTOMOBILES OF TOW (2) TIMES HIS INVESTMENT BUT IN NOT EVENT LESS
THAN THIRTY  THOUSAND  ($30,000)  DOLLARS AND A GROSS INCOME OF THIRTY  THOUSAND
($30,000) DOLLARS.

                            NOTICE TO IOWA RESIDENTS

         IOWA  RESIDENTS  MUST HAVE  EITHER  (i) A NET  WORTH OF AT LEAST  FORTH
THOUSAND ($40,000) DOLLARS (EXCLUSIVE OF HOME, HOME FURNISHINGS AND AUTOMOBILES)
AND A MINIMUM ANNUAL GROSS INCOME OF FORTH THOUSAND ($40,000) DOLLARS, OR (ii) A
NET WORTH OF AT LEAST ONE HUNDRED  TWENTY FIVE  THOUSAND  ($125,000)  DOLLARS AS
COMPUTED ABOVE.

                           NOTICE TO KANSAS RESIDENTS

         AN  INVESTMENT  BY A  NON-ACCREDITED  INVESTOR  SHALL NOT EXCEED TWENTY
(20%) PER CENT OF THE  INVESTOR'S  NET  WORTH;  EXCLUDING  PRINCIPAL  RESIDENCE,
FURNISHINGS THEREIN AND PERSONAL AUTOMOBILES.

                          NOTICE TO KENTUCKY RESIDENTS

         THESE  SECURITIES  REPRESENTED BY THIS  CERTIFICATE (OR OTHER DOCUMENT)
HAVE BEEN  ISSUED  PURSUANT TO A CLAIM OF  EXEMPTION  FROM THE  REGISTRATION  OR
QUALIFICATION  PROVISIONS  OF FEDERAL AND STATE  SECURITIES  LAWS AND MAY NOT BE
SOLD OR TRANSFERRED

                                        8

<PAGE>

WITHOUT  COMPLIANCE  WITH  THE  REGISTRATION  OR  QUALIFICATION   PROVISIONS  OF
APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR APPLICABLE EXEMPTIONS THEREIN.

         ANYTHING TO THE CONTRARY  HEREIN  NOTWITHSTANDING,  THE INVESTMENT BY A
NON- ACCREDITED INVESTOR MAY NOT EXCEED TEN (10%) OF THE INVESTOR'S NET WORTH.

                            NOTICE TO MAINE RESIDENTS

         THESE   SECURITIES  ARE  BEING  SOLD  PURSUANT  TO  AN  EXEMPTION  FROM
REGISTRATION  WITH THE BANK  SUPERINTENDENT  OF THE STATE OF MAINE UNDER SECTION
1052(2)(R) OF TITLE 32 OF THE MAINE REVISED  STATUES.  THESE  SECURITIES  MAY BE
DEEMED  RESTRICTED  SECURITIES  AND AS SUCH THE HOLDER MAY NOT BE ABLE TO RESELL
THE SECURITIES UNLESS PURSUANT TO REGISTRATION UNDER STATE OR FEDERAL SECURITIES
LAWS OR UNLESS AN EXEMPTION UNDER SUCH LAWS EXISTS.

                          NOTICE TO MARYLAND RESIDENTS

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE MARYLAND SECURITIES
ACT IN  RELIANCE  UPON THE  EXEMPTION  FROM  REGISTRATION  SET FORTH IN  SECTION
11-602(9) OF SUCH ACT. UNLESS THESE  SECURITIES ARE REGISTERED,  THEY MAY NOT BE
REOFFERED FOR SALE OR RESOLD IN THE STATE OF MARYLAND,  EXCEPT AS A SECURITY, OR
IN A TRANSACTION EXEMPT UNDER SUCH ACT.

                        NOTICE TO MASSACHUSETTS RESIDENTS

         MASSACHUSETTS RESIDENTS MUST HAVE HAD EITHER (i) A MINIMUM NET WORTH OF
AT LEAST FIFTY THOUSAND  ($50,000) DOLLARS (EXCLUDING HOME, HOME FURNISHINGS AND
AUTOMOBILES)  AND  HAD  DURING  THE  LAST  YEAR,  OR IT IS  ESTIMATED  THAT  THE
SUBSCRIBER  WILL HAVE  DURING THE  CURRENT  TAKE YEAR,  TAXABLE  INCOME OF FIFTY
THOUSAND  ($50,000)  DOLLARS,  OR (ii) A NET WORTH OF AT LEAST ONE HUNDRED FIFTY
THOUSAND ($150,000) DOLLARS (AS COMPUTED ABOVE).

                          NOTICE TO MICHIGAN RESIDENTS

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE MICHIGAN SECURITIES
ACT AND MAY NOT BE SOLD OR TRANSFERRED  WITHOUT  REGISTRATION  UNDER THAT ACT OR
EXEMPTION THEREFROM.

         THE  COMPANY  SHALL  PROVIDE  ALL  MICHIGAN  INVESTORS  WITH A DETAILED
WRITTEN  STATEMENT OF THE APPLICATION OF THE PROCEEDS OF THE OFFERING WITHIN SIX
(6) MONTHS  AFTER  COMMENCEMENT  OF THE OFFERING OR UPON  COMPLETION,  WHICHEVER
OCCURS  FIRST,  AND WITH  ANNUAL  CURRENT  BALANCE  SHEETS AND INCOME  STATEMENT
THEREAFTER.

                          NOTICE TO MINNESOTA RESIDENTS

         THESE  SECURITIES  HAVE NOT BEEN  REGISTERED  UNDER  CHAPTER  80 OF THE
MINNESOTA SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED
OF FOR VALUE EXCEPT PURSUANT TO REGISTRATION OR OPERATION OF LAW.

                         NOTICE TO MISSISSIPPI RESIDENTS

         THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
MISSISSIPPI   SECURITIES  ACT.  A  REGISTRATION   STATEMENT  RELATING  TO  THESE
SECURITIES  HAS NOT BEEN FILED WITH THE  MISSISSIPPI  SECRETARY OF STATE OR WITH
THE SECURITIES AND EXCHANGE  COMMISSION.  NEITHER THE SECRETARY OF STATE NOR THE
COMMISSION  HAS PASSED UPON THE VALUE OF THESE  SECURITIES,  NO HAS  APPROVED OR
DISAPPROVED THE OFFERING. THE

                                        9

<PAGE>

SECRETARY  OF STATE  DOES  NOT  RECOMMEND  THE  PURCHASE  OF THESE OR ANY  OTHER
SECURITIES.

         THERE IS NOT ESTABLISHED  MARKET FOR THESE SECURITIES AND THERE MAY NOT
BE ANY MARKET FOR THESE  SECURITIES  IN THE FUTURE.  THE  SUBSCRIPTION  PRICE OF
THESE  SECURITIES  HAS BEEN  ARBITRARILY  DETERMINED BY THE ISSUER AND IS NOT AN
INDICATION OF THE ACTUAL VALUE OF THESE SECURITIES.

         THE  PURCHASER  OF  THESE  SECURITIES  MUST  MEET  CERTAIN  SUITABILITY
STANDARDS  AND  MUST  BE  ABLE  TO  BEAR  THE  ENTIRE  LOSS  OF HIS  INVESTMENT.
ADDITIONALLY,  ALL PURCHASERS  WHO ARE NOT ACCREDITED  INVESTORS MUST HAVE A NET
WORTH OF AT LEAST  THIRTY  THOUSAND  ($30,000)  DOLLARS  AND  INCOME  OF  THIRTY
THOUSAND  ($30,000)  DOLLARS OR A NET WORTH OF SEVENTY FIVE  THOUSAND  ($75,000)
DOLLARS.  THESE  SECURITIES MAY NOT BE TRANSFERRED  FOR A PERIOD OF ONE (1) YEAR
EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER THE MISSISSIPPI  SECURITIES ACT OR
IN A TRANSACTION IN COMPLIANCE WITH THE MISSISSIPPI SECURITIES ACT.

                          NOTICE TO MISSOURI RESIDENTS

         THESE  SECURITIES  ARE SOLD TO, AND BEING  ACQUIRED BY, THE HOLDER IN A
TRANSACTION EXEMPTED UNDER SECTION 10, SUBSECTION  409.402(b),  MISSOURI UNIFORM
SECURITIES ACT (RMSO 1969).

         THE  SHARES  HAVE TO BEEN  REGISTERED  UNDER  SAID ACT IN THE  STATE OF
MISSOURI, UNLESS THE SHARES ARE REGISTERED,  THEY MAY NOT BE REOFFERED OR RESOLD
IN THE STATE OF MISSOURI, EXCEPT AS A SECURITY, OR IN A TRANSACTION EXEMPT UNDER
SAID ACT.

         ANYTHING  TO THE  CONTRARY  NOTWITHSTANDING,  AN  INVESTOR  MUST HAVE A
MINIMUM ANNUAL INCOME OF THIRTY THOUSAND  ($330,000)  DOLLARS AND A NET WORTH OF
AT LEAST THIRTY THOUSAND  ($30,000)(DOLLARS,  EXCLUSIVE OF HOME, FURNISHINGS AND
AUTOMOBILES OR A NET WORTH OF SEVENTY FIVE THOUSAND  ($75,000) DOLLARS EXCLUSIVE
OF HOME, FURNISHINGS AND AUTOMOBILES.

         AN  INVESTMENT  BY A  NON-ACCREDITED  INVESTOR  SHALL NOT EXCEED TWENTY
(20%) PER CENT OF THE INVESTOR'S NET WORTH.

                           NOTICE TO MONTANA RESIDENTS

         EACH MONTANA  RESIDENT WHO SUBSCRIBES FOR THE SECURITIES  BEING OFFERED
HEREBY  AGREES NOT TO SELL THESE  SECURITIES  FOR A PERIOD OF TWELVE (12) MONTHS
AFTER DATE OF PURCHASE.

         ANYTHING TO THE  CONTRARY  NOTWITHSTANDING,  THE  INVESTMENT  BY A NON-
ACCREDITED  INVESTOR MAY NOT EXCEED TWENTY (20%) PER CENT OF THE  INVESTOR'S NET
WORTH.

                          NOTICE TO NEBRASKA RESIDENTS

         THESE SHARES HAVE NOT BEEN REGISTERED UNDER THE NEBRASKA SECURITIES ACT
AND MAY NOT BE SOLD WITHOUT REGISTRATION UNDER THE ACT OR EXEMPTION THEREFROM.

                        NOTICE TO NEW HAMPSHIRE RESIDENTS

         EACH NEW HAMPSHIRE INVESTOR  PURCHASING SHARES MUST WARRANT THAT HE HAS
EITHER (i) A NET WORTH  (EXCLUSIVE OF HOME, HOME FURNISHING AND  AUTOMOBILES) OF
TWO HUNDRED FIFTY THOUSAND ($250,000) DOLLARS OR (iii) A NET WORTH (EXCLUSIVE OF
HOME, HOME

                                       10

<PAGE>

FURNISHINGS  AND  AUTOMOBILES  OF ONE HUNDRED  TWENTY FIVE  THOUSAND  ($125,000)
DOLLARS AND FIFTY THOUSAND ($50,000 DOLLARS ANNUAL INCOME.

                         NOTICE TO NEW JERSEY RESIDENTS

         THE  ATTORNEY  GENERAL OF THE STATE HAS NOT PASSED ON OR  ENDORSED  THE
MERITS OF THIS  OFFERING.  THE FILING OF THE WITHIN  OFFERING DOES TO CONSTITUTE
APPROVAL  OF THE ISSUE OR THE SALE  THEREOF BY THE BUREAU OF  SECURITIES  OR THE
DEPARTMENT  OF  LAW  AND  PUBLIC  SAFETY  OF  THE  STATE  OF  NEW  JERSEY.   ANY
REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

                        NOTICE TO NORTH DAKOTA RESIDENTS

            THESE  SECURITIES  HAVE  NOT BEEN  APPROVED  OR  DISAPPROVED  BY THE
SECURITIES  COMMISSION  OF THE STATE OF NORTH  DAKOTA  NOR HAS THE  COMMISSIONER
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY  REPRESENTATION TO
THE CONTRARY IS CRIMINAL OFFENCE.

                          NOTICE TO NEW YORK RESIDENTS

         THIS OFFERING  MEMORANDUM HAS NOT BEEN REVIEWED BY THE ATTORNEY GENERAL
PRIOR TO ITS ISSUANCE AND USE. THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS
NOT PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.

         THIS  OFFERING  MEMORANDUM  DOES NOT CONTAIN AN UNTRUE  STATEMENT  OF A
MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT  NECESSARY TO MAKE THE STATEMENTS
MADE IN LIGHT OF THE  CIRCUMSTANCES  UNDER WHICH THEY WERE MADE, NOT MISLEADING.
IT CONTAINS A FAIR SUMMARY OF THE MATERIAL  TERMS AND DOCUMENTS  PURPORTED TO BE
SUMMARIZED HEREIN.

                       NOTICE TO NORTH CAROLINA RESIDENTS

         THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
NORTH  CAROLINA  SECURITIES  ACT. THE NORTH  CAROLINA  SECURITIES  ADMINISTRATOR
NEITHER  RECOMMENDS  NOR  ENDORSES  THE  PURCHASE OF ANY  SECURITY,  NOR HAS THE
ADMINISTRATOR  PASSED ON THE  ACCURACY OR ADEQUACY OF THE  INFORMATION  PROVIDED
HEREIN. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

                          NOTICE TO OKLAHOMA RESIDENTS

         THESE SECURITIES  RENDERED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE OKLAHOMA  SECURITIES ACT. THE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT  AND MAY NOT BE SOLD OR TRANSFERRED  FOR VALUE
IN THE ABSENCE OF AN EFFECTIVE  REGISTRATION OF THEM UNDER THE SECURITIES ACT OF
1933 AND/OR THE OKLAHOMA  SECURITIES ACT OF AN OPINION OF COUNSEL TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR ACTS.

         ANYTHING  TO  THE  CONTRARY   NOTWITHSTANDING,   AN   INVESTMENT  BY  A
NON-ACCREDITS  INVESTOR  SHALL NOT EXCEED THEN (10%) PER CENT OF THE  INVESTOR'S
NET WORTH.

                           NOTICE TO OREGON RESIDENTS

         THE  SECURITIES  OFFERED  HAVE BEEN REGISTERED WITH THE DIRECTOR OF THE
STATE OF OREGON UNDER THE PROVISIONS OF OAR 441-65-240.  THE INVESTOR IS ADVISED
THAT THE DIRECTOR HAS MADE ONLY A CURSORY REVIEW OF THE  REGISTRATION  STATEMENT
AND HAS NOT

                                       11

<PAGE>

REVIEWED THIS DOCUMENTS SINCE THIS DOCUMENT IS NOT REQUIRED TO BE FILED WITH THE
DIRECTOR.

         THE INVESTOR MUST RELY ON THE INVESTOR'S OWN EXAMINATION OF THE COMPANY
CREATING THE SECURITIES,  AND THE TERMS OF THE OFFERING INCLUDING THE MERITS AND
RISKS INVOLVED IN MAKING AN INVESTMENT DECISION ON THESE SECURITIES.

                        NOTICE TO PENNSYLVANIA RESIDENTS

         ANY  PERSON WHO  ACCEPTS AN OFFER TO  PURCHASE  THE  SECURITIES  IN THE
COMMONWEALTH OF PENNSYLVANIA IS ADVISED,  THAT PURSUANT TO SECTION 207(m) OF THE
PENNSYLVANIA SECURITIES ACT, HE SHALL HAVE THE RIGHT TO WITHDRAW HIS ACCEPTANCE,
AND RECEIVE A FULL  REFUND OF ANY  CONSIDERATION  PAID,  WITHOUT  INCURRING  ANY
LIABILITY,  WITHIN TWO (20) BUSINESS DAYS FROM THE TIME THAT HE RECEIVES  NOTICE
OF THIS WITHDRAWAL  RIGHT AND RECEIVES THE PLACEMENT  OFFERING  MEMORANDUM.  ANY
PERSON  WHO WISHES TO  EXERCISE  SUCH  RIGHT OF  WITHDRAWAL  IS ADVISED TO GIVEN
NOTICE BY LETTER OR  TELEGRAM  SENT TO  POSTMARKED  BEFORE THE END OF THE SECOND
BUSINESS  DAY AFTER  EXECUTION.  IF THE REQUEST FOR  WITHDRAWAL  IS  TRANSMITTED
ORALLY,  WRITTEN  CONFIRMATION MUST BE GIVEN. ANY PERSON WHO PURCHASES INTERESTS
WHO IS A  PENNSYLVANIA  RESIDENT  WILL NOT SELL SUCH  INTERESTS  FOR A PERIOD OF
TWELVE (12) MONTHS BEGINNING WITH THE CLOSING DATE.  PENNSYLVANIA RESIDENTS MUST
HAVE  EITHER  (i) A  MINIMUM  NET  WORTH OF THIRTY  THOUSAND  ($30,000)  DOLLARS
(EXCLUDING  HOME,  HOME FURNISHING AND  AUTOMOBILES)  AND A MINIMUM ANNUAL GROSS
INCOME OF THIRTY  THOUSAND  ($30,000)  DOLLARS,  OR (ii) A NET WORTH OF AT LEAST
SEVENTY FIVE THOUSAND  ($75,000) DOLLARS (AS COMPUTED ABOVE0, AND MAY NOT INVEST
MORE THAN TEN (10%) PER CENT OF THEIR NET WORTH  (EXCLUSIVE OF THE  SUBSCRIBER'S
HOME, HOME FURNISHINGS AND AUTOMOBILES).

                       NOTICE TO SOUTH CAROLINA RESIDENTS

         THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
SOUTH CAROLINA  UNIFORM  SECURITIES  ACT. A REGISTRATION  STATEMENT  RELATING TO
THESE  SECURITIES  HAS  NOT  BEEN  FILED  WITH  THE  SOUTH  CAROLINA  SECURITIES
COMMISSIONER. THE COMMISSIONER DOES NOT RECOMMEND OR ENDORSE THE PURCHASE OF ANY
SECURITIES,  NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF THIS OFFERING
MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

                        NOTICE TO SOUTH DAKOTA RESIDENTS

         THE SHARES HAVE NOT BEEN  REGISTERED  UNDER  CHAPTER 47.31 OF THE SOUTH
DAKOTA SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
FOR VALUE EXCEPT PURSUANT TO REGISTRATION,  EXEMPTION  THEREFROM OR OPERATION OF
LAW.

         SOUTH DAKOTA  RESIDENTS  MUST HAVE EITHER (i) A MINIMUM NET WORTH OF AT
LEAST SIXTY THOUSAND  ($60,000)  DOLLARS  (EXCLUDING  HOME, HOME FURNISHINGS AND
AUTOMOBILES) AND A MINIMUM GROSS INCOME OF SIXTY THOUSAND ($60,000) DOLLARS,  OR
(ii) A NET WORTH OF AT LEAST TWO HUNDRED TWENTY FIVE THOUSAND ($225,000) DOLLARS
(AS COMPUTED ABOVE).

                          NOTICE OF TENNESSEE RESIDENTS

         ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTMENT BY ANY INVESTOR
SHALL NOT EXCEED TEN (10%) PER CENT OF THE INVESTOR'S NET WORTH.

                                       12

<PAGE>

                            NOTICE OF TEXAS RESIDENTS

         THIS OFFERING MEMORANDUM IS FOR THE INVESTOR'S CONFIDENTIAL USE AND MAY
NOT BE  REPRODUCED.  ANY ACTION  CONTRARY TO THESE  RESTRICTIONS  MAY PLACE SUCH
INVESTOR AND THE ISSUER IN VIOLATION OF THE TEXAS SECURITIES ACT.

         ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTMENT BY ANY INVESTOR
SHALL NOT EXCEED TEN (10%) PER CENT OF THE INVESTOR'S NET WORTH.

                            NOTICE TO UTAH RESIDENTS

         THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UTAH SECURITIES ACT
AND MAY NOT NE SOLD WITHOUT REGISTRATION UNDER THAT ACT OR EXEMPTION THEREFROM.

                         NOTICE TO WASHINGTON RESIDENTS

         THESE   SECURITIES  HAVE  NOT  BEEN  REGISTERED  UNDER  THE  WASHINGTON
SECURITIES  ACT AND THE  ADMINISTRATOR  OF SECURITIES OF THE STATE OF WASHINGTON
HAS NOT REVIEWED THE OFFERING OR OFFERING  MEMORANDUM.  THESE SECURITIES MAY NOT
BE SOLD WITHOUT REGISTRATION UNDER THE ACT OR EXEMPTION THEREFROM.

         IT IS THE  RESPONSIBILITY OF ANY INVESTOR  PURCHASING SHARES TO SATISFY
ITSELF AS TO FULL OBSERVANCE OF THE LAWS OF ANY RELEVANT  TERRITORY  OUTSIDE THE
UNITED  STATES IN CONNECTION  WITH ANY SUCH  PURCHASE,  INCLUDING  OBTAINING ANY
REQUIRED  GOVERNMENTAL  OR OTHER  CONSENTS  OR  OBSERVING  ANY OTHER  APPLICABLE
REQUIREMENTS.

                                       13

<PAGE>

                               OFFERING MEMORANDUM

-------------------------------------------------------------------------------

                            MARICULTURE SYSTEMS,INC.
                             (A Florida Corporation)

                   Offering Memorandum Dated December 3, 1996

                                 985,000 Shares

         MariCulture systems, Inc., (the "Company"),  a Florida corporation,  is
offering on a "best efforts, no minimum basis" up to a maximum of 985,000 shares
of common stock ("Common  Stock"),  $.001 par value,  at $1.00 per Share.  Since
there is no minimum,  no proceeds  will be held in escrow  account and all funds
will be immediately available to the Company.

         The Company  intends to apply for  inclusion of the Common Stock on the
Over the Counter  Electronic  Bulletin Board. There can be no assurances that an
active  trading  market will develop,  even if the  securities  are accepted for
quotation.  Additionally,  even if the  Company's  securities  are  accepted for
quotation and active trading develops, the Company is still required to maintain
certain  minimum  criteria  established  by  NASDAQ,  of which  there  can be no
assurance that the Company will be able to continue to fulfill such criteria.

         Prior to this offering,  there has been no public market for the common
stock of the Company.  The price of the Shares  offered  hereby was  arbitrarily
determined  by the Company and does not bear any  relationship  to the Company's
assets,  book value,  net worth,  results of operations or any other  recognized
criteria of value. For additional  information  regarding the factors considered
in determining  the offering price of the Shares,  see "Risk Factors - Arbitrary
Offering Price," "Description of Securities".

         The Company does not presently file reports or other  information  with
the  Securities  and  Exchange  Commission  ("Commission").  However,  following
completion of this offering, the Company intends to furnish its security holders
with annual reports  containing  audited  financial  statements and such interim
reports,  in each case as it may  determine  to furnish or as may be required by
law.

         THESE   SECURITIES  HAVE  NOT  BEEN  APPROVED  OR  DISAPPROVED  BY  THE
SECURITIES AND EXCHANGE  COMMISSION OR ANY STATE  SECURITIES  COMMISSION NOR HAS
THE COMMISSION OF ANY STATE  SECURITIES  COMMISSION  PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS.  ANY  REPRESENTATION  TO THE CONTRARY IS A CRIMINAL
OFFENSE.

         THE  SECURITIES  ARE  OFFERED BY THE  COMPANY  SUBJECT  TO PRIOR  SALE,
ACCEPTANCE OR AN OFFER TO PURCHASE, WITHDRAWAL,  CANCELLATION OR MODIFICATION OF
THE OFFER,  WITHOUT NOTICE.  THE COMPANY RESERVES THE RIGHT TO REJECT ANY ORDER,
IN WHOLE OR IN PART, FOR THE PURCHASE OF ANY OF THE SECURITIES OFFERED HEREBY.

                                       14

<PAGE>

         This offering  involves special risks concerning the Company (see "Risk
Factors").  Investors should  carefully review the entire  Memorandum and should
not  invest  any funds in this  Offering  unless  they can  afford to lose their
entire  investment.  In making an investment  decision,  investors  must rely on
their own examination of the issuer and the terms of the Offering, including the
merit and risks involved.

                                OFFERING SUMMARY

         The following  summary  information is qualified in its entirety by the
detailed  information  and  financial  statements  and notes  thereto  appearing
elsewhere in this Memorandum.

         The Company is in the business of  developing  and  marketing  products
based on proprietary, state- of-the-art, aquiculture technology. The Company was
incorporated  in the State of  Florida  and its  principal  executive  office is
located at 21300 68th Avenue West, Suite 203, Lynwood, Washington 98306.

                                  RISK FACTORS

         THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE
OF RISK. ONLY THOSE PERSONS ABLE TO LOSE THEIR ENTIRE INVESTMENT SHOULD PURCHASE
THESE SECURITIES. PROSPECTIVE INVESTORS, PRIOR TO MAKING AN INVESTMENT DECISION,
SHOULD  CAREFULLY READ THIS  PROSPECTUS  AND CONSIDER,  ALONG WITH OTHER MATTERS
REFERRED TO HEREIN, THE FOLLOWING RISK FACTORS:

Risk Factors Relating to the Business of the Company

         Start-up  or  Development  Stage  Company.   The  Company  has  had  no
operations  since its  organization  and is a "start-up" or "development  stage"
company.  No  assurances  can be given that the Company  will be able to compete
with other  companies in its industry.  The purchase of the  securities  offered
hereby  must be  regarded  as the  placing  of funds at a high  risk in a new or
"start-up"  venture  with all the  unforeseen  costs,  expenses,  problems,  and
difficulties to which such ventures are subject. See "Use of Proceeds to Issuer"
and "Description of Business."

         No Assurance of  Profitability.  To date, the Company has not generated
any revenues from  operations.  The Company does not anticipate any  significant
revenues in the near future. The Company's ability to successfully implement its
business plan is dependent on the completion of this  Offering.  There can be no
assurance  that  the  Company  will be  able to  develop  into a  successful  or
profitable business.

         No Assurance of Payment of Dividends.  No  assurances  can be made that
the future operations of the Company will result in additional  revenues or will
be profitable.  Should the operations of the Company  become  profitable,  it is
likely that the  Company  would  retain much or all of its  earnings in order to
finance future growth and expansion.  Therefore,  the Company does not presently
intend to pay dividends, and it is not likely that any dividends will be paid in
the foreseeable future. See "Dividend Policy."

         Possible Need for  Additional  Financing . The Company  intends to fund
its operations and other capital needs for the next 12 months substantially from
the proceeds of this  Offering,  but there can be no  assurance  that such funds
will be  sufficient  for these  purposes.  The Company  may  require  additional
amounts  of  capital  for its  future  expansion,  operating  costs and  working
capital.  The  Company  has made no  arrangements  to obtain  future  additional
financing,  and if required,  there can be no assurance that such financing will
be available,  or that such financing will be available on acceptable terms. See
"Use of Proceeds."

                                       15

<PAGE>

        Dependence on Management. The Company's success is principally dependent
on its current management personnel for the operation of its business.

         Broad  Discretion in  Application  of Proceeds . The  management of the
Company has broad discretion to adjust the application and allocation of the net
proceeds  of this  offering,  in  order to  address  changed  circumstances  and
opportunities.  As a result of the foregoing, the success of the Company will be
substantially  dependent  upon the  discretion and judgment of the management of
the Company with respect to the  application  and allocation of the net proceeds
hereof.  Pending use of such proceeds, the net proceeds of this offering will be
invested by the Company in temporary,  short-term interest-bearing  obligations.
See "Use of Proceeds."

         Immediate  and  Substantial Dilution. An investor in this offering will
experience immediate and substantial dilution.

         Lack of Prior Market for Securities of the Company. No prior market has
existed for the  securities  being offered  hereby and no assurance can be given
that a market will develop subsequent to this offering.

         No Escrow of Investors'  Funds.  This offering is being made on a "best
efforts,  no minimum  basis" As such,  all the funds from this  Offering will be
immediately available to the Company.

         Possible Need for  Additional  Financing.  Additional  financing may be
required  some time in the future to enable the Company to promote its  business
expand to capture  markets  available to it. No assurance  can be given that the
Company  will be able to secure such  financing,  if needed,  at a cost that the
Company can afford.  If the Company cannot secure such additional  funding,  its
growth potential may be limited.

         Competition.   The  Company  has  numerous  competitors  and  potential
competitors,  many of which have considerably  greater financial  resources than
the  Company.  There  is no  assurance  that the  Company  will  continue  to be
successful  in  its  businesses.  Although  the  Company  believes  that  it has
advantages over competitors,  no assurance can be made those current competitors
or new entrants  into the market will not develop  strategies  to make them more
competitive.

         Arbitrary Determination of Offering Price. The offering price of $1 per
share was  determined  arbitrarily  by the  Company and has no relation to asset
value of the  Company.  Each  prospective  investor  should make an  independent
evaluation of the fairness of such price.

         Lack of Prior Market for the Company's  Common Stock and Possible Penny
Stock  Regulation.  No prior  market has  existed for the Shares  being  offered
hereby and there is no assurance that a market were to develop, the Shares could
be  subject  to  the  Penny  Stock  Regulations.  The  Securities  and  Exchange
Commission has adopted rules that regulate broker-dealer practices in connection
with   transactions  in  "penny  stocks."  Penny  stocks  generally  are  equity
securities with a price of less than $5.00 (other than securities  registered on
certain national securities  exchanges or quoted on the NASDAQ system,  provided
that current price and volume  information  with respect to transactions in such
securities is provided by the exchange or system). The penny stock rules require
a  broker-dealer,  prior to a transaction in a penny stock not otherwise  exempt
from the rules, to deliver a standardized  risk disclosure  document prepared by
the Commission that provides  information  about penny stocks and the nature and
level of risks in the penny stock market.  The  broker-dealer  also must provide
the customer with bid and offer quotations for the penny stock, the compensation
of the broker-dealer and its salesperson in customer's account. In addition, the
penny  stock  rules  require  that prior to a  transaction  in a penny stock not
otherwise  exempt from such rules the broker- dealer must make a special written
determination  that the penny stock is a suitable  investment  for the purchaser
and  receive  the  purchaser's  written  agreement  to  the  transaction.  These
disclosure requirements

                                       16

<PAGE>

may have the effect of reducing the level of trading  activity in the  secondary
market  for a stock  that  becomes  subject  to the penny  stock  rules.  If the
Company"s  Common Stock becomes  subject to the penny stock rules,  investors in
this Offering may find it more difficult to sell their shares.

         Shares  Eligible  For Future  Sale.  8,800,000  shares of Common  Stock
currently   outstanding  were  offered  and  sold  by  the  Company  in  private
transactions  in  reliance  upon  an  exemption  from  registration   under  the
Securities Act. Accordingly,  all of such shares are "restricted  securities" as
defined by Rule 144 ("Rule 144") under the  Securities  Act and cannot be resold
without  registration  except  in  reliance  on Rule 144 or  another  applicable
exemption from registration.

         In  general,  under  Rule 144 a person  (or  persons  whose  shares are
required  to be  aggregated),  including  any  affiliate  of  the  Company,  who
beneficially  owns  restricted  shares  for a period  of at least  two  years is
entitled  to sell within any three month  period  shares  equal in number to the
greater of (i) 1 percent of the then  outstanding  shares of the Common Stock or
(ii) the average  weekly  trading  volume of the same class of shares during the
four calendar weeks preceding the filing of the required notice of sale with the
commission.  The  seller  must also  comply  with the  notice and manner of sale
requirements of Rule 144, and there must be current public information available
about the Company. In addition, any person (or persons whose shares are requires
to be  aggregated)  who is not,  at the time of sale,  nor during the  preceding
three  months,  an  affiliate  of the  Company,  and who is  beneficially  owned
restricted  shares for at least three years, can sell such shares without regard
to  notice,  manner  of  sale,  public  information  or the  volume  limitations
described  above.  Shares of the Common  Stock  first will become  eligible  for
resale under Rule 144 in June 1998 (assuming the other  requirements of Rule 144
are met).

         No prediction can be made as to the effect,  if any, those future sales
of the above described  outstanding  Common Stock,  or the  availability of such
Common  Stock for sale,  will have on the market price  prevailing  from time to
time. Sales of substantial amounts of such Common Stock in the public market, or
the  perception  that such  sales may  occur,  could  adversely  affect the then
prevailing market price.

                                   THE COMPANY

         The Company was  incorporated  in the State of Florida on July 8, 1996.
On August 22, 1996, the Company entered into a Share Exchange  Agreement whereby
the Company issued and exchanged  8,800,000  shares of its common stock for 100%
of the issued and outstanding stock of MariCulture  Systems,  Inc. ("MCS"), As a
result of that transaction, MCS became a wholly owned subsidiary of the Company.
Since  prior to this  acquisition,  the  Company  had  minimal  operations,  all
references  herein to the  Company  will  refer to the  operations  of MCS.  The
Company's  corporate  offices are located at 21300 68th Avenue West,  Suite 203,
Lynwood, Washington, 98306.

         MCS was  incorporated  in August  1994 to develop  and market  products
based on proprietary,  state- of-the-art,  aquaculture technology. The Company's
primary  source of revenue  will be through  the sale of SARGO  turnkey  finfish
production  systems to fish farming  organizations  worldwide.  According to the
Company's research, this is currently a $1 billion plus market that is projected
to  double  within  five  years.  The  market  for the  SARGO  system  is in all
freshwater  and  saltwater  environments  located  adjacent to or within a short
distance from shore.  The Company  believe that a SARGO system will be purchased
because:  (1) SARGO addresses and eliminates  many of the current  environmental
and  regulatory  concerns of  traditional  fish rearing  methods;  (2) SARGO can
increase the production  capacity of current farms by approximately 400% and (3)
SARGO can substantially lower production costs. The Company currently has United
States Patents pending on the SARGO technology and system.

                                       17

<PAGE>

THE WORLDWIDE FISH INDUSTRY

         The  world's  oceans  have been  fished  nearly to the  limits of their
sustainable  yields according to a report released by the non-profit  Worldwatch
Institute.  A recent  'State  of the  World'  report  grimly  states:  "Although
worldwide environmental  degradation of the oceans contributes to the decline of
marine life, overfishing is the primary cause of dwindling fish populations. The
oceans  are  not the  unlimited  reservoir  of  low-cost  food  they  were  once
considered." In his conclusion,  Worldwatch President Lester Brown, also writes,
"Human demands are approaching the limits of oceanic fisheries to supply fish."

         Worldwide  commercial  fishing  yields have declined well over 5% since
peaking in 1989,  mostly due to  extensive  fishing  by  large-scale  industrial
operations  and  often  in  waters  that  are  becoming  more  polluted.  Recent
technology advancements in sonar and fishing methods have significantly depleted
17 of the  world's  major  fishing  regions,  many of which  are now  closed  to
commercial fishing.  The results are hundreds of thousands of commercial fishing
industry jobs lost due to the lack of wild fish.

DEMAND FOR SEAFOOD

While fishing yielda have declined, the demand for seafood has increased.   This
increase in demand is largely  attributed  to a greater  consumer  awareness  of
health  benefits of seafood,  an increased  per capita  income,  the  increasing
propensity  for dining our, and the improved  availability  of fresh seafood via
express  delivery.  Global  demand for fresh  seafood has steadily  increased in
recent years by over 10% per year. As worldwide  demand for  consumable  protein
accelerates,  demand and  expenditures  for seafood will  similarly  continue to
increase.  Money spent by consumers for seafood  during the last decade has more
than doubled.  In 1994,  aquaculture  "evolved" into a $32.4 Billion industry to
meet this increasing seafood demand.

THE AQUACULTURE INDUSTRY

In order to meet the increasing demands for seafood, another  source  of seafood
rather than the natural ones of the open waters had to be  established.  This is
what  aquaculture is all about.  Aquaculture is a broad term defined as "the art
of  cultivating  the  products of water or the raising or fattening of fish." It
includes the culture of fish, mollusks,  crustaceans,  algae,  seaweed, and even
bullfrogs  and  alligators.  Fish  farming is the  process of rearing  desirable
species of fish in captivity and managing both the fish and their environment to
improve  growth  and  reproduction.  Fish are  reared in fish farms much as farm
animals  are raised in the  barnyard.  The fish  culturist  manages  the aquatic
environment  to protect the fish from  predators,  parasites,  and disease.  The
culturist also feeds the fish and controls water quality to prevent pollution.

The aquaculture industry constitutes a large and growing  segment of the world's
seafood economy. In 1984, world seafood production was 80,000,000 metric tons of
which  2,500,000  metric  tons was from  aquaculture.  In  1992,  world  seafood
production  increased to 100,000,000  metric tons while  aquaculture  production
reached  19,000,000  metric tons.  World  aquaculture  production is expected to
exceed  50%  of  seafood  consumption  in  the  early  2000's.  The  future  for
aquaculture  appears  bright as the demand for seafood  worldwide is expected to
increase by 70% in the next 35 years.  To meet that  demand,  world  aquaculture
will have to increase production at least five-fold by the year 2025.

                                       18

<PAGE>

The decline of wild catches during the past decade has spawned new growth in the
fish  farming  industry.  As happened  with other basic meats,  the  traditional
"hunting"  means  of  providing  fish,  is now  being  replaced  by a  "farming"
means...aquaculture.  This growth in aquaculture  created  thousands of new fish
culture  facilities  around  the  world,  producing  a wide  variety  of finfish
species.  Currently,  large  finfish sea farms  cultivate  Salmon,  Sea Bass and
Seabream.  Tuna,  Sturgeon and Halibut are now being  developed  and farmed on a
small scale.

The following  background is closely  focused on salmon as an example due to its
immense  popularity with fish farmers.  Salmon  aquaculture has had an explosive
growth  rate  since the  introduction  of  floating  net cages in Norway and the
United States in 1969. The most dramatic  growth  occurred from the early 1980's
to the mid 1990's.  World salmon  production in 1983 was 680,000  metric tons of
which  aquaculture  produced 24,000 metric tons. A new world  production peak of
1,280,000 metric tons of salmon was reached in 1994, with aquaculture accounting
for 470,000  metric  tons.  Commercial  fishing  catches of wild salmon  reached
slightly over 800,000 metric tons in 1994, showing average yearly increases from
1983 of 1.6%. However,  farmed salmon production  increased at an annual rate of
31% during the same period.  Aquaculture  production  of salmon now accounts for
over 36% of the  worldwide  production  of  salmon.  From  1989 to  1994,  world
revenues  from the sale of farmed  salmon  increased  from $1.56 Billion to $3.1
Billion.  The growth in total  supply of over 5.5% per year  coupled with strong
price  support  indicates a shifting  demand for salmon.  This is due in part to
changing  dietary  habits,  increasing  population  and an improved fresh salmon
distribution  network.  Since  price is a function  of  availability,  fish farm
operators  can maximize  profits by  scheduling  harvests for periods when fresh
wild  catch fish are  unavailable  or in low  supply.  Concerns  about  improved
nutrition and lowered  cholesterol intake are changing dietary habits to include
high  quality,  low  cholesterol  products  such as  salmon  and  other  seafood
products. In addition, major distributors of agricultural products have expanded
into seafood  distribution  as the dietary  habits of the United  States and the
world  change.  A stable  year-round  supply of fresh  seafood  provided by fish
farming  has  increased   supplies  for  restaurants,   supermarkets  and  other
distribution  channels  that  must have  constant  availability  and  consistent
quality.

With worldwide aquaculture demand for finfish at nearly 12  million  metric tons
per year and growing at  approximately  13% annually,  the Company believes that
now is the time to bring about major productivity changes in the industry.  Fish
farming facilities account for production of 8.5% of total finfish harvests,  up
from less than one  -percent  15 years  ago.  This rapid  growth has  produced a
demand for a more efficient and cost effective technology that can also meet the
environmental  requirements  now confronting  today's  producers.  The market is
available  and  accessibility  to that  market is a major  factor in pricing and
consumption demand. Aquaculture is rapidly becoming recognized as a major factor
in the food supply chain.

EXISTING AQUACULTURE TECHNOLOGY

Current  marine  finfish  farming  techniques  employ  "open net pens," that are
commonly  clustered into "farms" located within cold or warm near-shore  coastal
waters, in warm water ponds as well as in cool water impoundment  areas.  Nearly
all  open  net pen  cages  are  suspended  from  floating  walkways  or  support
structures that are moored near shore. Normally,  pens or cages are sized either
forty feet  square or fifty feet  square by twenty  feet to forty feet in depth,
although larger nets up to 80 feet are now being introduced in some farms. Farms
typically  consist of twenty to eighty  cages  floating  in two to five acres of
surface water. These cage operations must be placed in high tidal water

                                       19

<PAGE>

exchange  locations  to  maintain  adequate  levels of  dissolved  oxygen and to
dispose of accumulated fish and food wastes.

Operation of a net pen facility is relatively labor intensive.  As the fish grow
in size and require more water flow,  the nets must be replaced  with  different
mesh sizes or the fish must be moved from pen to pen.  Removal  and  cleaning of
the nets must be  performed  on a regular  basis to reduce  marine  fouling that
grows over and closes the mesh.  Constant  inspection of the nets is required to
find  predator  damage and  immediately  repair the nets to avoid  escape of the
crop.  Feeding of the fish is usually  performed by hand or with  semi-automatic
feeders and must be done on a regular schedule to maintain growth.

The growing conditions in net  pens  are  not consistent with the natural deeper
water habitat of most cultivable fish. These growing conditions are a compromise
between  biological  requirements and the ability of the net pen farm to operate
profitably. Several problems currently challenge the net pen farmer's ability to
raise fish and maintain  profitability.  These are: (1) Location - Net pens must
be located where there is  pollution-free  high tidal water flow; (2) Diseases -
High mortality rate  fluctuations  are due to "Red Tide" and other shallow water
specific diseases;  (3) Biological - Predators  penetrate or damage nets and eat
or release fish crop; (4) High Food Cost - water currents carry away much of the
feed;  (5)  Environment  - Discharge  of high  levels of organic  fish waste and
pollutants;  and (6) Scenic View - The  increase in  shore-side  landowners  not
wanting a facility within sight.

The  finfish  growing  environment  in  net  pen  cages  on  near  surface water
conditions for temperature,  salinity,  oxygen and water purity  characteristics
and offers little  protection from pollutants and predators.  Net pen farms have
virtually no control over water  conditions.  The farmers'  only option,  should
water conditions deteriorate,  is to tow the farm to a different site as is done
regularly in Chilean  salmon farms.  If adverse  conditions  persist,  they must
close the farm and cease  operations.  Disease  organisms  are a major threat to
fish crops.  Present  attempts to control disease outbreak in net cages, and its
easy transfer to adjacent  blooms,  such as "Red Tide," have all too  frequently
been  responsible  for 50% to 100%  crop  losses  in net pen  operations.  These
catastrophic  losses present  sizable  investment  risks to farming  operations.
Biological  concerns  escape to the wild,  mixing  with the local  species,  and
eventually  competing for the same resources.  These losses occur from predators
damaging the nets or failure to maintain the nets. Predators,  such as sea lions
and  otters,  often  destroy  large  portions  of a crop while  enjoying a "free
lunch." It is a perception  that  competition  from released fish can reduce the
native stocks.  Predators,  within close proximity of the cages,  create extreme
stress for a fish crop and substantially increase mortality.

The  high  costs  of food for finfish production climbs with the loss of uneaten
food passing  through the nets or being swept away by the tidal  currents.  This
lost food also  contributes  to the organic waste  accumulation  beneath the net
pens.  It is  estimated  that  from 20 to 40% of the food is  wasted  in net pen
installation.

In addition to the foregoing,  there is  increasing pressure from the shore-side
property  owners to not permit  farms that  detract  from the scenic water views
along their shore. The high cost of litigation  precludes issuance of permits in
areas where residential  construction may occur. Therefore, the net pen operator
must locate in far out of way places. These locations substantially increase the
cost of transportation and maintenance.

                                       20

<PAGE>

THE COMPANY'S TECHNOLOGY

The solution to these problems is to replace the older system with the Company's
SARGO system. The Company's SARGO rigid wall fish rearing system is patented and
offers  many  significant   technological   advancements  over  the  traditional
near-shore open net-pen cage methods currently used to grow marketable  finfish.
Many of the key SARGO features provide advantages which the Company believes are
so  pronounced,  when compared to current net pen  technology,  that  Management
believes the system will create new environmental  and regulatory  standards for
commercial fish farming facilities.  Such concerns as farm waste,  polluting the
waterways,  escaped  cultivated  fish competing for food and habitat with native
fish, and the visual impact of sprawling  large-scale farming operations will be
quickly resolved.

New SARGO Technology

New  technology   advancements  in  land-based  aquaculture  systems  are  being
successfully  applied  in fish  farms in  Northern  Europe.  These  advancements
eliminate  most of the above noted  challenges  against net pens,  however  they
operate at a prohibitive  cost level.  The fish rearing  technology  used in the
SARGO design evolved as a lower cost variant of these land-based concepts. SARGO
is a  self-contained  floating  system  located  near-shore  with access to deep
water.

A  SARGO  system  consists of one or more modular pods.  Each pod is composed of
four,  rigid wall,  floating  fish  reservoirs.  Each pod also has a centralized
service  platform  fitted with  required  pumps,  feeding  equipment  and sensor
control  systems.  Ideal,  deep  source  water is  pumped  into  the  reservoirs
continuously,  replenishing  oxygen  levels for the fish and  providing  a water
current "raceway" for the fish to school  naturally.  One hundred percent of the
solid fish waste and other  organic  matter is collected for disposal in a waste
management system.

In a typical farm, there are multiples of pods,  each  of which provide the fish
raising ability of over 40 net pens. A SARGO farm, physically equivalent in site
size  to the  largest  net pen  farms  currently  in  operation,  would  produce
approximately  8,000 metric tons of salmon per year. The production  capacity of
the comparably sized net pen operation is only 1,000 metric tons per year.

Key Features

There are several operational  features of SARGO, which  differentiate  it  from
other available aquaculture technologies.  These features include:

1. Fully Enclosed Fish Containment  Reservoir:  Unlike traditional net pens that
are open to the sea, SARGO has impermeable  reservoirs  that completely  isolate
their fish crop from surrounding waters. Each solid wall reservoir is fabricated
from a reinforced  fiberglass  or composite  plastic resin that is impervious to
corrosion  and highly  resistant to bio fouling from  barnacles,  anemones,  and
similar marine  organisms.  This feature  changes the  aquaculture  process from
planting juvenile fish in a "fenced-off"  portion of the sea, into an industrial
process where system inputs,  outputs and internal operations are fully managed.
In Northern Europe this controllable approach is successfully used in land-based
sites. However,  these land-based operations are not competitive due to the high
costs of land,  infrastructure,  power and water. SARGO is a floating variant of
these proven land- based systems.

                                       21

<PAGE>

2. Water Circulation and Supply: A system of intake  strainers,  pipes and pumps
conveys water from  selected  levels deep beneath the surface,  distributes  the
water, and circulates it in the fish containment reservoirs. This ideal water is
characterized by constant temperature, relatively constant dissolved gas content
and much lower numbers of disease  organisms.  The screened intake for each farm
is placed at the  optimum  depth  determined  by the  local  bathymetry  and the
species of fish being reared.  Water  supplied into each reservoir is aerated or
oxygenated as needed in order to increase and maintain fish metabolic  rates and
to further increase stocking density capability.  Sterilization of the water due
to changing  bacteria  conditions  is generally not required but is available as
required  with an ozone  generator.  The  water  flow rate is  variable  to each
reservoir with excess water leaving the reservoirs  through an overflow.  Levels
of any dissolved contaminants in the overflow water are extremely low due to the
high water  volume  throughput.  The rate of water  exchange,  salinity and fish
waste is  monitored  over time to enhance  operational  conditions  and increase
system productivity.

3. Raceway Current:  A circulating water current or "water raceway" is generated
in each SARGO rearing reservoir. There are two purposes for this current. First,
salmon and other finfish  naturally  school and this raceway current will propel
the fish into schooling.  The schooling and forced swimming  against the current
lowers stress on the fish.  Less stress  permits higher  stocking  densities and
reduces  mortalities.  Additionally,  fish  metabolic  rates  increase from this
constant exercise.  The exercise improves fish feed conversion rates and results
in lowering overall feed costs to grow-out.  Fish growth rates will increase and
result in shorter grow-out  periods or larger fish if desired.  The magnitude or
velocity of the current is a controlled  function  that is matched to fish size;
that is, smaller fish have a slower current while larger,  more mature fish have
an increasingly faster current.

4. Structural Elements:  This includes all structural  components other than the
fish rearing reservoirs.  The built-in walkways,  flotation,  pump wells, piping
and cable supports,  equipment foundations, and weather protection enclosures. A
major  subsystem is the service  platform that  structurally  ties all the rigid
reservoirs  together  with  floating  walkways  and houses the various  systems,
equipment and  supplies.  Connection  points to the mooring  system are provided
from the service  platform.  Reservoirs and the service  platform are modular in
design so that a farm may be expanded simply by adding additional pods.

5.  Monitor  and  Control  System:  This  control  system is  configured  from a
combination  of sensors,  programmable  logic  controllers,  pump control boxes,
motor  starters,   and  processors  with  their  own  embedded   software.   All
controllable  parameters of the fish rearing  process may be managed  within the
system  controller.  These  parameters are manipulated by the system of sensors,
the AquaGro software, computers, variable rate hardware devices, and proprietary
operating  algorithms.  The data collection computers and sensors measure actual
system  performance.  The software  compares and analyzes the results to nominal
parameters,  and then  sends  commands  to  hardware  to adjust  outputs to meet
desired  conditions.  This  capability  enables  Company  management  to further
optimize farm  operations to more  profitable  levels.  Examples of controllable
parameters  include water flow rates, feed rates and timing,  oxygenation rates,
photoperiod manipulation, current velocity, and solid waste disposal.

6. Capturing  Waste:  The vortex created by the water current  funnels all solid
wastes,  mostly fish feces and uneaten food, to the cone-shaped where it settles
and is collected.  Instead of becoming an  uncontrolled  accumulation on the sea
floor or lake bottom, the waste is moved into a waste

                                       22

<PAGE>

collection  tank for later  treatment or  conversion  into a useable  fertilizer
by-product.  A waste  treatment  plant  is  available  with  the  system.  Waste
collection  and analysis  provide the ability to sample for feed and  medication
utilization. Analysis over time can optimize feed and medicine usage rates.

7. Auxiliary  Equipment:  Includes the electric power and lighting system with a
standby generator, compressed air, service water, and similar support equipment.
Life support can be supplied by commercial  automated  feeding,  oxygenation and
aeration equipment with distribution piping.

8. Mooring:  It is customized to the site and consists of anchors,  chain, cable
and buoys including any navigational and night lighting.

         These  unique  attributes  of SARGO  combine  to  provide a variety  of
benefits that are unmatched by any open net pen systems. As a result,  operation
of the  fish  farm  is  technically  managed  and  controlled,  yielding  a more
productive, lower cost and ecologically sound operation that is cost competitive
to any operation worldwide.

PRODUCT DEVELOPMENT

         The  Company  developed  the  SARGO  design  with over  three  years of
research into addressing the aquaculturists' needs and engineering a sustainable
alternative. All major design work was done by the Company's staff while outside
consultant firms for evaluation of the subsystems and various issues  associated
with  water  based  platforms.  All  Company  developed  proprietary  system and
software designs have patents pending.

         All major  subsystems are initially being contracted out by the Company
and built by  subcontractors  to the Company's design and quality  requirements.
The final assembly and  construction  will be done at the purchasers  site using
contracted  assembly teams  supervised by the Company.  This will minimize fixed
overhead and allow the Company to expand  production and sales without having to
raising additional capital for fixed plant and equipment.

TECHNOLOGY ADVANTAGES

         The  Company  believes  that its SARGO  system  has many  technological
advantages over competitive systems. The Company believes that the following are
the major advantages:

1. SARGO provides an optimum  environment  for  aquaculture.  The rigid,  opaque
walls of the reservoirs isolate the fish crop from predators, disease, plankton,
bacteria and toxic contaminants found in surrounding surface waters. The opacity
of the reservoirs  excludes direct daylight to closely simulate conditions found
at depths the fish normally seek in the wild. In keeping contaminants out of the
fish-rearing  environment,  the separate and independent reservoirs also prevent
any pollutants  and disease that may occur in one reservoir  from  contaminating
the surrounding waters or adjacent reservoirs.  Composition of the water and its
constituents is optimized for fish growth. The temperature,  salinity and oxygen
content can be controlled to closely

                                       23

<PAGE>

duplicate  the natural  habitat  conditions  or adjusted to a more ideal  growth
condition.  Selecting  the depth of the water intake  controls  temperature  and
salinity.   Oxygen  level  is  controlled   by  variable   water  volume  pumped
continuously  into the  reservoirs  that may be augmented  by either  mechanical
aeration or injection of pure oxygen into the water stream.  A translucent  top,
shade  screen or bird netting may be fixed on each  reservoir  to provide  light
control as well as exclude bird  predators and prevent fish from  escaping.  The
SARGO design  permits the addition of night lighting to extend feeding hours and
is proven to promote faster growth in salmon and certain  species  through photo
period manipulation. SARGO provides a controlled speed, constant "water raceway"
current  circulating  within the reservoir,  inducing fish to swim in a parallel
school  formation  against the pumped water flow. The swimming  action  improves
muscle tone and flesh texture while greatly  diminishing  the occurrence of "eye
biting" often  observed upon harvest of net pen reared  salmon.  This eye biting
results  from  stress and  produces an  unsightly  appearance  in the  harvested
salmon. It can also cause infection and possible death prior to harvesting.

2. The  operating  costs of SARGO  are  lower  than  those of any net pen  farms
currently  in  operation.   Studies  indicate  that,  well-run  salmon  net  pen
operations  can hold  their  costs  between  $1.70  and  $1.85 per pound of fish
produced.  Initial studies performed on SARGO rearing  technology  indicate that
reduced fish mortality,  higher  metabolizing rates, lower food costs, and lower
labor costs reduce overall operating expenses to $1.15 per pound.

3. The  unique  attributes  of SARGO  work in  harmony  to  provide a variety of
benefits that are unmatched by any open net pen systems.

4. Farm  operators  switching to SARGO will  realize an  immediate  reduction in
operating costs for the following reasons:

5. Mortality  rates drop to 5% or less from the current net pen levels of 15% to
40%.  The  pilot  grow-out  produced  a  mortality  rate of only  3.6%.  Similar
operations on land have  consistently  produced fish with mortality rates in the
3% to 5% ranges.  Stress and losses due to predation are  virtually  eliminated.
This  reduction in mortality  is done without any increase in  medication,  thus
reducing costs. However, when medications or water borne inoculants are desired,
the controlled environment increases effectiveness and significantly reduces the
quantity  required.  There  is  also  a  reduction  in  any  resultant  residual
contamination of the overflow water.

6.  Substantial  savings  result from the  reduction  in work force  required to
operate,  maintain and repair a fish farming  operation.  Automation reduces the
operating labor requirements by up to 50%. Compared to net pens, which must have
their  nets  rotated  every few months and  replaced  every 3 to 4 years,  SARGO
reservoirs require only minimal attention. Routine maintenance of the mechanical
components and the limited cleaning of the reservoirs in a SARGO installation is
far less than that of net maintenance and repair.

7. Repair and maintenance labor for a SARGO  installation is also  significantly
reduced.  Additional  savings  result  from the  30-year  life of the rigid wall
reservoirs  when  compared to the 3 to 4 year life  expected  of a net pen.  All
major  elements  in a  SARGO  system  are  warranted  up to 10  years  by  their
manufacturers,  which helps  contain many  maintenance  charges.  The  reservoir
itself is warranted for 20 years.

                                       24

<PAGE>

8.  Another  principle  advantage of the vortex flow in SARGO is that it directs
waste to the  conical  bottom  section of the  reservoir  for  collection.  This
feature prevents dispersion of waste to the outside environment.  SARGO delivers
this waste, containing feces and uneaten food, through a separation system, to a
separate  collection  tank for  treatment,  disposal or potential  sale. A major
benefit of waste  collection  is the  ability to sample for feed and  medication
utilization.  Analysis over time can optimize feed and medicine usage rates. The
rate of water  exchange,  salinity and fish waste is also monitored over time to
enhance operational  conditions and increase system  productivity.  As a result,
operation  of the fish farm will  become  technically  managed  and  controlled,
yielding a more productive, lower cost and ecologically sound operation that can
be  competitive  to  any  operation  worldwide.  Just  as  the  reservoirs  keep
contaminants out of the fish-rearing environment,  they also keep pollutants and
disease in one reservoir from  contaminating the surrounding  waters or adjacent
reservoirs.  Domesticated  fish are also prevented from escaping to compete with
native  fish  for  food  and  habitat.   The  perceived   concern  over  escaped
domesticated  fish  breeding  with native fish,  thereby  contaminating  genetic
stocks, is also eliminated.

9. The  concerns  of fish  farms  polluting  surrounding  waters,  escaped  fish
competing for food and habitat with wild fish,  escaped fish  interbreeding with
native  fish,  and the  sight  of  large  floating  fish  farms  near  expensive
waterfront  property have  resulted in a near  moratorium on new farm permits in
some parts of the world.  As a consequence,  new farms are usually  installed in
very remote areas such as upper British Columbia,  Canada and Chile. The results
is that transportation for supplies and fish product are significantly increased
and the  available  pool of  prospective  employees  limited.  These  costs  are
generally  being  absorbed  by  the  farmer,  thus  reducing  his  profits.  The
permitting  process  and site costs for SARGO  should  notably  be  reduced  and
streamlined since all these environmental  factors are nearly eliminated.  SARGO
should set a new standard in aquaculture for environmental compatibility.  These
revised standards may result in great increases in the number of potential sites
available for SARGO such as those near population centers.

MARKET FOR SARGO SYSTEM

         As a result  of  diminished  natural  seafood  supplies  and  increased
demand, the worldwide market for aquaculture  products is growing rapidly.  From
1984 to 1994 the market grew ten fold. In 1984  aquaculture  accounted for 3% of
total seafood  production or 2.5 million tons. By 1994 production had reached 23
million tons approximating 20% of total seafood production.  Finfish aquaculture
accounts for about 60% of total aquaculture  production and industry projections
are that finfish aquaculture production will double in the next 5 years. To meet
this demand  production  capacity must double as well.  The industry will invest
over $30  billion  in  capital  equipment  within  the next 5 years to meet this
growing demand.  The total aquaculture  capital equipment market is projected to
grow to over $8 billion by the year 2001.  Finfish  aquaculture  equipment  will
grow to over $5 billion by the end of 2001.  The Company  needs to capture  less
than 2% of the total finfish  aquaculture  capital equipment market to meet its'
sales projections.

         The company believes that marketing  opportunities  continue to develop
for SARGO throughout the world as extraordinary political pressures intensify to
address  endangerment and extinction of various finfish species. In Japan, where
food resource security is a high government priority,  the government has set up
an  incentive   funding   program  to  subsidize   fish  farms  that  invest  in
environmental technology.

                                       25

<PAGE>

         A persuasive  argument can be made for  purchasing a SARGO  considering
its environmental  compliance  capabilities alone. However, the Company believes
the primary purchase motivation for its environmentally  engineered systems will
come from the system's ability to greatly reduce the cost of rearing fish.

         The Company is committed  to making  SARGO a leader in the  aquaculture
industry by providing its customers with the most profitable and environmentally
sustainable  means to rear finfish in a captive  environment.  The initial focus
will  be  to  market  the  Company's   proven  finfish   production   technology
advancements  to existing  net-pen fish farmers and food related  companies  who
want to enter the cultured finfish industry.

POTENTIAL CUSTOMERS

         There are a variety of potential SARGO purchasers to be targeted by the
company's marketing team. These potential customers included:

         1. Existing Net Pen Fish Farmers:  Current users of traditional net pen
fish rearing  systems offer MCS its greatest  potential  customer  base.  Small,
standard SARGO modules or reservoirs  can be supplied for retrofit  installation
into existing net cage permitted  areas.  A new four reservoir  SARGO with pumps
and service  platform is  available  for either new fish farms or  additions  to
existing farms.  Existing net pen fish farmers can easily justify  exclusive use
of MCS systems in the future once they are convinced by the advantages  inherent
to SARGO technology.

         2. Food Corporations:  Several large processors of chicken, beef, pork,
and  turkey  currently  own  sizable  seafood  concerns  and are  interested  in
producing their own competitively  priced "home grown" fish. This fulfills their
goals to augment their existing seafood processing operations and to provide the
United States  domestic  market,  which is highly  dependent on imports,  with a
constant  supply  of fish.  Many of these  companies  are not yet aware of SARGO
technology,  but they  currently  manage their other meat  operations  utilizing
similar methods.

         3. Fish Processing & Equipment  Companies:  Fish processing is a highly
seasonal business and in recent years one of increasingly great uncertainty over
fish  supplies.  Many fish  processing  companies  also own and operate  fishing
vessels  that  compete for limited fish  resources  along with their  customers.
These companies are now forced to look for  alternative,  year around sources of
fish. Other companies supplying  essential products to farming operations,  such
as equipment,  feed, and medications  are potential  customers with channels for
global distribution and could become VARs (Value Added Reseller).

         4.  Commercial  Fishermen:  Many  fishermen  have  become  wealthy  via
commercial  net  fishing.  However,  over the last several  years,  depletion of
natural fish stocks has significantly  affected their personal cash flows. These
commercial fishing revenues are declining very rapidly,  are highly seasonal and
subject to canceled  seasons.  There is growing interest from these  independent
operators  in fish  farming  as a means to  provide a  sustainable  year  around
income.

         5. Government  Agencies:   During  the  last  five  years,  hundreds of
thousands of commercial fishing industry jobs have been lost world-wide due to a
lack of fish. This job loss is causing local,  state and federal  governments to
finance extraordinary political unemployment

                                       26

<PAGE>

solutions.  Government  funds are  becoming  readily  available  for  vocational
retraining  of  commercial  fishermen.  Fish  farming  related  programs are now
classified as a priority  among various  agencies.  The Company will also pursue
various government-sponsored technology and research grants targeted at programs
for environmental mitigation and aquaculture or fisheries enhancement.

         6.  Native  American  means  of  income. Recent Federal Indian fishing-
season  cutbacks have severely hurt many Indian  economies,  particularly in the
Pacific  Northwest.  Many  tribes have also been  involved in raising  fish long
before the term "aquaculture" came into existence. With the profitable growth of
on-  reservation  gambling,  many  tribes  can now  afford  to  invest in higher
technology fish farming production means.

         7. Fish Research Facilities: Fish research has increased as native fish
populations  decrease  worldwide.  These  research labs require  technology  for
rearing  juvenile and adult aquatic  species.  Many fish  research  programs are
centered in the Pacific  Northwest  as salmonid  stocks are  perceived  to be in
serious jeopardy.

MARKETING PLAN

         The Company's  early marketing plan was to build a SARGO pilot facility
installation  in a Pacific  Northwest  commercially  permitted farm location for
convenience  of access.  This first  facility  was built with the support of the
National  Marine  Fisheries  Service  at  their  already  permitted  Manchester,
Washington.  NMFS,  as part  of the US  Department  of  Commerce,  has  provided
technical  assistance and evaluation  without  providing any  endorsement of the
facility.  The size and production  capabilities of the pilot farm were designed
to allow for direct  extrapolation  of all  production  data.  This  facility is
complete and is producing  data.  The Company has  introduced  the first crop of
Atlantic  salmon into the system and is giving tours to  prospective  purchasers
and news organizations.

         The second  stage of the  Company's  marketing  plan is to promote  its
state-of-the-art  SARGO fish rearing technology based on its' superior return on
investment  results and  environmental  design  versus  traditional  means,  MCS
customer  service,  and a guaranteed  yield.  This will include a  comprehensive
Return-On-Investment  ("ROI")  computer based sales tool that willbe used by the
Company.  With the use of ROI, a potential  customer can to input system data to
determine realistic farm financial results.

         After the market  becomes aware of what the Company's  believes will be
the success in its pilot program,  the company  intends to leverage this success
to acquire interested distribution channels. The company intends to aggressively
pursue selected strategic relationships to quickly place the SARGO technology in
Latin America,  Asia, the Middle East and the  Mediterranean  while focusing the
Company's direct sales effort in North America and Europe.

COMPETITION

         Open net pen technology, whether located near shore or offshore, is the
major competitor to a floating, near shore, rigid wall fish rearing system. This
net pen technology and the fish farming  industry's  robust growth in total fish
capacity during the last 15 years has been reinforced principally

                                       27

<PAGE>

by an  infrastructure  of well  established  vendors.  These firms are supplying
fishing  nets,  rubber,  galvanized  metal,  and plastic  products to commercial
fishermen.  Fishing nets combined with the  flotation  gear are the  predominant
materials  used in  salt-water  aquaculture  to enclose  commercial  fish crops.
Wavemaster,  Ltd.,  based in Ireland  with  manufacturing  and sales  offices in
Vancouver,  British  Columbia,  Canada,  is  the  largest  aquaculture  facility
producer.  It  has  more  than  2000  flotation  walkways  for  near  shore  net
operations,  predominantly rearing salmon, in service worldwide. Only one of the
ten most prominent net pen suppliers,  Net Systems,  Inc. of Bainbridge  Island,
Washington is based in the United States.  Their operation  primarily focuses on
providing  netting  and does not  effectively  market its Ocean Spar  system for
aquaculture  facilities.  Therefore,  the Company's  initial  competition in the
Pacific Northwest will be principally from foreign,  primarily  European,  based
companies.  Many net pen systems  are sold as turnkey  operations  with  floats,
nets,  walkways,  and moorage  included in the capital costs.  All  replacements
components are priced and sold on an individual basis.

SALES PROJECTIONS

         At a projected  price of $1,700,000 per SARGO pod, the Company can meet
its  expected  Year-5  revenue  projection  of $107.2  Million by gaining a 7.9%
market share of the new rearing pen market for salmon  only.  This share is less
than 2% of the Company's target market and less than 1% of the world aquaculture
equipment  market.  Initial market entry does not consider sales  penetration of
the existing  retrofit market in salmon  production nor the market available for
rearing any other species that may be farmed.  The market potential for new pens
to be used in  salmon  farming  alone  over the next 5 years is more  than  $2.0
Billion.  Sales of SARGO are expected to accelerate rapidly after publication of
the results of the successful pilot system  installation.  The Company will sell
SARGO as a  replacement  for the existing  67,000  salmon net pens  presently in
service as well as to new installations.  The Company expects to market SARGO to
operators  of finfish  farms for all species of salt water and fresh water fish.
The above does not include other  opportunities which have been presented to the
company.  These include Polyculture (multiple species of seafood),  Hydroponics,
and Aquaponics.  The company  believes that the basic technology and our lead in
developing or acquiring new  technology  for the industry will continue to offer
many and varied new avenues of development.

PRIOR FINANCING

         The  Company's   original  founders  and  management  team  contributed
$252,300 to the Company's  original capita.  These funds were used for research,
travel,  general overhead and in- house development of the Company's technology.
Thereafter,  the Company  raised  $435,000 in the fourth quarter of 1995 to fund
the Pilot Facility  construction and initial operations.  The Pilot facility has
met all of the  Company's  budgets  for  Million to finance  Company  operations
through  the end of  1999.  The  Company  intends  to use  these  funds  for the
Company's  international  marketing efforts,  research and development,  project
engineering,  pilot facility operations, and administrative overhead. Additional
funding of working capital or short-term  loans may be the availability of order
deposits,  accounts  receivable  turnover  and  vendor  terms.  Short  term debt
financing may be adequate to cover this need after shipments begin.

         The  Company  has  spent  or is  committed  to spend  $368,000  for the
construction  and  installation of the Pilot Facility.  The Company has incurred
operational losses for the 12 months

                                       28

<PAGE>

of operation of $125,236. The costs are due to office rent, travel expenses, and
general overhead. The Company has paid less than $10,000 in salaries to date.

         The Company  expects to receive  revenues from sales orders during late
1998.  The sales  effort and timing of sales will be impacted  by the  Company's
ability to raise  additional  capital from this  Offering.  The rapid raising of
capital is important to completing an initial sale quickly. A SARGO sale will be
as a complete  modular fish rearing  assemblies of six  reservoirs and a service
platform   constituting  a  pod.  Companies  interested  in  commercial  finfish
production  are generally  expected to initially  purchase a minimum system of 2
pods. Governmental agencies interested in endangered species or fish enhancement
programs  would  likely  purchase a system  containing  1 to 3 pods.  A pod of 6
reservoirs will sell for approximately $1,700,000.

PENDING NEGOTIATIONS

         The Company is currently negotiating with two separate entities for the
sale of the Company's system.  The first potential sale is to a US firm to raise
salmon and the purchase  price for the system is estimated to be $1.85  million.
The second  potential  sale is with a Japanese  venture and the Company  will be
successful in finalizing the negotiations of either sale.

DISCLAIMER

         The preceding was based upon Management's  research and the projections
are based upon Managements'  reasonable conclusions from its research.  There is
no assurance that such goals and projections will be achieved.

USE OF PROCEEDS

         The gross proceeds from the sale of the  securities  offered hereby are
estimated to be $985,000.  It is anticipated that the proceed a will be used for
general  working  capital and the  Company's  expansion  over the twelve  months
following completion of the Offering.

Dividend Policy

         The Board of Directors  currently intends to retain the future earnings
of the Company to finance  research  and  development  and the  expansion of the
Company's  business.  Any future  payment of cash  dividends  will  therefore be
highly  dependent upon the Company's  earnings,  capital  requirements,  overall
financial condition and other factors deemed relevant by its Board of Directors.
Furthermore,  the agreement related to this financial  Transaction will prohibit
the payment of any dividends by the Company.

MANAGEMENT

Officers and Directors

The executive  officers and directors,  key persons and employees of the Company
are:

                                       29

<PAGE>

         David E. Meilahn Mr.  Meilahn is the Company's CEO and Senior Engin eer
and he has  spent  nearly  30 years in a number  of  executive  and  engineering
positions  with both  start-up  and  fortune  100  firms.  These  firms  include
McGraw-Edison,  National  Service  Industries  and  American  Standards  Testing
Bureau.  Mr.  Meilahn has a BS in Industrial  Engineering  Technology and an MBA
from  the  University  of  Wisconsin.  He has  extensive  industrial  experience
including Research & Development,  Manufacturing and Sales in foods,  electrical
products,  machine tools,  lubrication and cooling systems,  automotive assembly
and  the  construction  products  industry.  Mr  Meilahn  has  managed  numerous
engineering  research  and  development  programs  from  basic  concept  through
full-scale deployment and is the inventor of the original concept for SARGO. Mr.
Meilahn  has overall  responsibility  for new  product  development  and Company
operations.

         William S. Evans Mr. Evans is the Company's Vice President of sales and
has a BS, Marine  Biological  Sciences from Auburn  University with postgraduate
work in Fisheries at the University of Washington. He has 16 years experience in
sales  management  for  industries   directly   involved  with  the  aquaculture
marketplace.  Mr.  Evans  technical  expertise  stems from his work as a fishery
scientist at Auburn  University.  He has managed  regional  seafood  quality and
sales  activities for Castle and Cooke and spent six years in Alaska  performing
research for the EPA on mitigating the impacts of seafood  processing  effluents
to coastal environments. During his career as Director of Distribution and Sales
for  an  electronic  instrument   manufacturer,   Mr.  Evans  managed  a  global
multi-tiered  distribution  network for instrument products and services.  These
products  were  utilized for  environmental  monitoring,  including  aquaculture
rearing facilities.  He has focused his sales skills and extensive experience on
new  product  development.  He  introduced  six new  products  and started a new
transportation  products division,  doubling revenues for his previous employer.
Mr. Evans is responsible  for the development of the North American sales effort
with secondary  responsibility for international  sales. His duties also include
direct management of sales, distribution, and customer service personnel for the
Company.

         Michael Mulholland    Mr. Mulholland is in charge of the Company's farm
operations.  He has a BS from th e University of Vancouver,  BC. Mr.  Mulholland
has over 16 years of  experience  and is a noted  expert in  project  management
within the  aquaculture  and  seafood  industry.  Mr.  Mulholland  has  provided
consulting  services  throughout the world on salmon farming operations and is a
recognized  speaker at  technical  seminars.  He  founded  and  managed  Pacific
National  Group's largest fish farming  operations in Canada for 8 years and was
their  Vice  President,   Operations.  Mr.  Mulholland  will  provide  oversight
management of all farming  research  operations  including fish husbandry,  fish
biology and development of feed resources.

         Roderick Campbell Mr. Roderick Campbell is the Company's Pilot Facility
Manager.  He is a Canadian  citizen with a Bachelor of Science degree in Biology
from Mount Allison University,  Sackville, New Brunswick,  Canada. He has worked
in  Scotland,  the United  Kingdom and Canada as a marine  biologist in the fish
farming  industry for the past twelve years.  Mr.  Campbell's job duties for the
position are as the Pilot Production Facility Aquaculture  Biologist responsible
for the on-site management of the pilot installation at Manchester,  Washington.
He will interface with the local NMFS' personnel as required, be responsible for
fish  husbandry,   data  collection  and  evaluation,   and  the  operation  and
maintenance of the physical production plant.

         Joseph C. Gnagey   Mr.  Gnagey  is  the  Company's Manager in the Sales
Support  Division.  He has a BS in Fishery Science from Oregon State University.
He has  fifteen  years of  operations,  sales and  marketing  experience  in the
aquaculture and marine fishing industries. Mr.Gnagey has

                                       30

<PAGE>

recently been director of sales and marketing for a major  supplier of equipment
to these  industries,  with full  responsibility  for large capital projects and
customer relations in Europe,  North and South America, and Asia. He has chaired
working  committees on business  development,  commercial  fishing  policy,  and
seafood quality ion the processing and harvesting  sectors of the industry.  His
experience  includes the successful start-up of two international joint ventures
and a managing national and international sales support and customer service for
MCS systems.

PRINCIPAL SHAREHOLDERS

         Prior to this Offering, the Company had 10,000,000 shares of its Common
Stock issued and  outstanding.  The following table sets forth, as of October 1,
1996,  the  beneficial  ownership of the Company's  Common Stock (i) by the only
persons  who are known by the  Company to own  beneficially  more than 5% of the
Company's Common Stock;  (ii) by each director of the Company;  and (iii) by all
directors and officers as a group.

<TABLE>
<CAPTION>
Name                       Number of Shares    Percentage Owned     Percentage Owned
                           Owned               Prior to Offering    After Offering
-----------------------    ----------------    -----------------    --------------
<S>                        <C>                 <C>                  <C>
David Meilahn              2,492,213           24.92%               22.65%

William Evans              1,990,386           19.90%               18.09%

Robert Work (1)            2,385,176           23.85%               21.68%
Mark Kruschwitz (2)          654,440            6.54%                5.95%

All Officers as a Group
(2 people)                 4,482,599           44.82%               40.74%
</TABLE>

(1)      Mr. Work is neither an officer nor director of the Company.
(2)      Mr. Kruschwitz is neither an officer nor director of the Company.

DESCRIPTION OF SECURITIES

Shares

         The Company is offering hereby a "best efforts, no minimum basis" up to
985,000 shares of common Stock at $1.000 per Share.

Common Stock

         The  authorized  capital  stock of the Company  consists of  20,000,000
shares of Common  Stock,  par value.  Holders  of the  Common  Stock do not have
preemptive  rights  to  purchase  additional  shares  of  Common  Stock or other
subscription  rights.  The Common Stock carries no conversion  rights and is not
subject to  redemption or to any sinking fund  provisions.  All shares of Common
Stock are entitled to share equally in dividends from sources legally  available
therefor  when,  as  and if  declared  by  the  Board  of  Directors  and,  upon
liquidation or dissolution of the Company, whether voluntary or involuntary,  to
share equally in the assets of the Company available for distribution to

                                       31

<PAGE>

stockholders.  All outstanding shares of Common Stock are validly authorized and
issued,  fully paid and  nonassessable,  and all shares to be sold and issued as
contemplated  hereby,  will be validly  authorized  and  issued,  fully paid and
nonassessable.  The Board of Directors is authorized to issue additional  shares
of  Common  Stock,  not  to  exceed  the  amount  authorized  by  the  Company's
Certificate  of  Incorporation,  on such  terms  and  conditions  and  for  such
consideration  as the Board may deem  appropriate  without  further  stockholder
action.  The above  description  concerning the Common Stock of the Company does
not purport to be complete.  Reference is made to the Company's  Certificate  of
Incorporation  and Bylaws which are available for inspection  upon proper notice
at the Company's offices,  as well as to the applicable statutes of the State of
Florida for a more complete description concerning the rights and liabilities of
stockholders.

         Prior to this  offering,  there has been no market for the Common Stock
of the  Company,  and no  predictions  can be made of the effect,  if any,  that
market sales of shares or the  availability  of shares for sale will have on the
market price  prevailing from time to time.  Nevertheless,  sales of significant
amounts of the Common  Stock of the Company in the public  market may  adversely
affect prevailing  market prices,  and may impair the Company's ability to raise
capital at that time through the sale of its equity securities.

         Each  holder of Common  Stock is  entitled to one vote per share on all
matters on which such  stockholders  are  entitled to vote.  Since the shares of
Common Stock do not have cumulative  voting rights,  the holders of more than 50
percent of the shares  voting for the  election of  directors  can elect all the
directors  if they  choose  to do so and,  in such  event,  the  holders  of the
remaining shares will not be able to elect any person to the Board of Directors.

PLAN OF DISTRIBUTION

         The Company  has no  underwriter  for this  Offering.  The  Offering is
therefore a self- underwriting. The Shares will be offered by the Company at the
offering price of $1.00 per Share.  The Offering is being made on a best-efforts
basis by officers  and  directors  of the Company  with no minimum  necessary to
close the Offering.  No  commissions or other  remuneration  will be paid to the
Company's  officers  and  directors in  connection  with the  Offering,  but the
Company  reserves the right to sell the Shares through NASD members a commission
not to exceed 10% of the purchase price of the Shares sold.

Price of the Offering.

         There is no, and never has been, a market for the Shares,  and there is
no  guaranty  that  a  market  will  ever  develop  for  the  Company's  shares.
Consequently, the offering price has been determined by the Company. Among other
factors  considered in such  determination  were estimates of business potential
for the  Company,  the  Company's  financial  condition,  an  assessment  of the
Company's  management and the general  condition of the securities market at the
time of this  Offering.  However,  such  price  does  not  necessarily  bear any
relationship to the assets, income or net worth of the Company.

         The offering price should not be considered an indication of the actual
value of the  Shares.  Such  price is  subject  to  change as a result of market
conditions and other factors,  and no assurance can be given that the Shares can
be resold at the Offering Price.

                                       32

<PAGE>

         There can be no assurance  that an active  trading  market will develop
upon  completion  of this  Offering,  or if such market  develops,  that it will
continue.  Consequently,  purchasers of the Shares offered hereby may not find a
ready market for Shares.

ADDITIONAL INFORMATION

         Each investor  warrants and  represents  to the Company that,  prior to
making an investment in the Company,  that he has had the opportunity to inspect
the books and records of the Company and that he has had the opportunity to make
inquiries to the  officers and  directors of the Company and further that he has
been provided full access to such information.

                                       33

<PAGE>

                       INVESTOR SUITABILITY STANDARDS AND
                             INVESTMENT RESTRICTIONS

Suitability

         Shares  will be  offered  and sold  pursuant  an  exemption  under  the
Securities Act, and exemptions  under  applicable  state securities and Blue Sky
laws.  There are different  standards  under these federal and state  exemptions
which must be met by prospective investors in the Company.

         The  Company  will sell Shares only to those  Investors  it  reasonably
believes meet certain suitability requirements described below.

         Each  prospective  Investor  must  complete  a  Confidential  Purchaser
questionnaire  and  each  Purchaser  Representative,  if any,  must  complete  a
Purchaser Representative Questionnaire.

         EACH INVESTOR MUST  BE RESPONSIBLE FOR DETERMINING THAT IT IS
PERMITTED TO INVEST IN THE COMPANY, THAT ALL APPROPRIATE ACTIONS TO
AUTHORIZE SUCH AN INVESTMENT HAVE BEEN TAKEN, AND THAT ANY
REQUIREMENTS THAT ITS INVESTMENTS BE DIVERSIFIED OR SUFFICIENTLY
LIQUID HAVE BEEN MET.

         An investor will qualify as an  accredited  Investor if it falls within
any one of the  following  categories  at the time of the sale of the  Shares to
that Investor:

         (1) A bank as defined in Section  3(a)(2) of the  Securities  Act, or a
savings  and loan  association  or  other  institution  as  defined  in  Section
3(a)(5)(A) of the Securities Act,  whether acting in its individual or fiduciary
capacity; a broker or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934;  an insurance  company as defined in Section  2(13) of the
Securities Act; an investment  company  registered under the Investment  Company
Act of 1940 or a business  development company as defined in Section 2(a)(48) of
that Act; a Small  Business  Investment  Company  licensed by the United  States
Small Business  Administration under Section 301(c) or (d) of the Small Business
Investment  Act of 1958;  a plan  established  and  maintained  by a state,  its
political  subdivisions,  or any  agency  or  instrumentality  of a state or its
political subdivisions, for the benefit of its employees, if such plan has total
assets in excess of $5,000,000;  an employee  benefit plan within the meaning of
the Employee  Retirement Income Security Act of 1974, if the investment decision
is made by a plan  fiduciary,  as defined in Section 3(21) of that Act, which is
either a bank, savings and loan association,  insurance  company,  or registered
investment  adviser,  or if the employee benefit plan has total assets in excess
of $5,000,000,  or, if a self-directed  plan with the investment  decisions made
solely by persons that are accredited investors;

         (2) A private business development company as defined in Section 202(a)
(22) of the Investment Advisers Act of 1940;

         (3) An  organization  described  in  Section  501(c)(3) of the Internal
Revenue Code with total assets in excess of $5,000,000;

                                       34

<PAGE>

         (4)      A director or executive officer of the Company.

         (5) A natural  person whose  individual  net worth,  or joint net worth
with that person's spouse,  at the time of such person's  purchase of the Shares
exceeds $1,100,000;

         (6) A natural person who had an individual income in excess of $200,000
in each of the two most recent years or joint income with that  person's  spouse
in excess of $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year;

         (7) A trust with total assets in excess of  $5,000,000,  not formed for
the specific  purpose of acquiring the  securities  offered,  whose  purchase is
directed  by a  sophisticated  person  as  describe  in  Rule  506(b)(2)(ii)  of
Regulation D; and

         (8)  An  entity  in  which  all  of  the  equity  owners are accredited
investors (as defined above).

         As used in this  Memorandum,  the term "net worth"  means the excess of
total assets over total  liabilities.  In computing net worth for the purpose of
(5) above,  the  principal  residence  of the  investor  must be valued at cost,
including  cost  of  improvements,   or  at  recently   appraised  value  by  an
institutional lender making a secured loan, net of encumbrances.  In determining
income an  investor  should  add to the  investor's  adjusted  gross  income any
amounts attributable to tax exempt income received,  losses claimed as a limited
partner  in  any  limited   partnership,   deductions   claimed  for  depletion,
contributions  to an IRA or KEOGH  retirement plan,  alimony  payments,  and any
amount by which income form long-term capital gains has been reduced in arriving
at adjusted gross income.

         In order to meet the  conditions  for exemption  from the  registration
requirements under the securities laws of certain  jurisdictions,  investors who
are  residents  of  such   jurisdiction  may  be  required  to  meet  additional
suitability requirements.

         An  Investor  that does not  qualify  as an  accredited  Investor  is a
nonaccredited Investor and may acquire Shares only if:

          (1) The  Investor is  knowledgeable  and  experienced  with respect to
investments  in  limited   partnerships  either  alone  or  with  its  Purchaser
Representative, if any; and

          (2) The Investor has been provided access to all relevant documents it
desires or needs; and

          (3) The  Investor  is  aware of its  limited  ability  to sell  and/or
transfer its Shares in the Company; and

          (4) The Investor  can bear the economic  risk  (including  loss of the
entire  investment)  without  impairing its ability to provide for its financial
needs and  contingencies  in the same  manner  as it was  prior to  making  such
investment.

                                       35

<PAGE>

         THE COMPANY RESERVES THE RIGHT IN ITS ABSOLUTE  DISCRETION TO DETERMINE
IF A POTENTIAL  INVESTOR  MEETS OR FAILS TO MEET THE  SUITABILITY  STANDARDS SET
FORTH IN THIS SECTION.

Additional Suitability Requirements for Benefit Plan Investors

         In addition to the foregoing suitability standards generally applicable
to all  Investors,  the Employee  Retirement  Income  Security  Act of 1934,  as
amended ("ERISA"),  and the regulations promulgated thereunder by the Department
of Labor impose certain additional  suitability standards for Investors that are
qualified   pension,   profit-sharing   or  stock  bonus  plans  ("Benefit  Plan
Investor"). In considering the purchase of Shares, a fiduciary with respect to a
prospective  Benefit Plan Investor  must  consider  whether an investment in the
Shares will satisfy the prudence  requirement of Section  404(a)(1)(B) of ERISA,
since  there  is not  expected  to be any  market  created  in  which to sell or
otherwise  dispose of the Shares.  In  addition,  the  fiduciary  must  consider
whether the investment in Shares will satisfy the diversification requirement of
Section 404(a)(1)(C) of ERISA.

Restrictions on Transfer or Resale of Shares

         The  Availability  of Federal and state  exemptions and the legality of
the offers and sales of the Shares are conditioned upon, among other things, the
fact that the purchase of Shares by all  Investors are for  investment  purposes
only  and  not  with  a  view  to  resale  or  distribution.  Accordingly,  each
prospective Investor will be required to represent in the Subscription Agreement
that it is  purchasing  the Shares for its own  account  and for the  purpose of
investment  only, not with a view to, or in accordance with, the distribution of
sale of the  Shares and that it will not sell,  pledge,  assign or  transfer  or
offer to sell, pledge, assign or transfer any of its Shares without an effective
registration  statement under the Securities Act, or an exemption there from and
an opinion of counsel  acceptable  to the Company  that  registration  under the
Securities Act is not required and that the transaction  complies with all other
applicable Federal and state securities or Blue Sky laws.

                                       36

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00015-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00015-of-00352.parquet"}]]