Form 10QSB Spire Technologies Inc.

10QSB - Optional form for quarterly and transition reports of small business issuers

Published: 2004-08-13 14:55:13
Submitted: 2004-08-13
Period Ending In: 2004-06-30
dravco10q0604.htm 10QSB


> ENT> 10QSB 1 dravco10q0604.htm 10QSB

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549



FORM 10-QSB


[X]

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 FOR THE QUARTERLY PERIOD ENDED June 30, 2004

 

OR

[  ]

Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the transition period from to



COMMISSION FILE NUMBER -  333-54044



DRAVCO MINING INC.

(Exact name of registrant as specified in its charter)



NEVADA

88-0474904

(State of other jurisdiction of incorporation or organization)

(IRS Employer Identification Number)



DRAVCO MINING INC.

1865 Dilworth Drive, Suite 101

Kelowna, British Columbia

Canada V1Y 9T1

(Address of principal executive offices)


(604) 687-6991

(Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes [ X] No [   ]


Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of June 30, 2004: 9,000,000.


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ITEM 1.

FINANCIAL INFORMATION


DRAVCO MINING INC.

(An Exploration Stage Company)

Balance Sheet

(Unaudited)




As at

June 30,

2004

December 31, 2003

 

$

$


ASSETS


     

Current

     Cash


  194,462


      787


Total Assets


  194,462


      787



LIABILITIES


Current

     Accounts payable and accrued liabilities


    8,040


   5,926

     Advances due to related party

   43,127

  43,127


Total Liabilities


   


  49,053


STOCKHOLDER’S EQUITY


Common Stock

   


  Authorized:  100,000,000 shares, $0.00001 par value

  Issued and outstanding: 9,000,000 shares

  (December 31, 2003: 5,000,000 shares)



        

       90



  

      50


Additional Paid-In Capital


199,960


-


Deficit Accumulated During the Exploration Stage


           (56,755)


           (48,316)


Total Stockholder’s Equity


      


           (48,266)


Total Liabilities and Stockholder’s Equity


      194,462


    787






See Accompanying Notes to the Financial Statements







  DRAVCO MINING INC.

  (An Exploration Stage Company)

  Statements of Operations

  (Unaudited)

 








  For the Three

  Months

  Ended

  June 30,








     For the Six

     Months

     Ended

     June 30,



Cumulative

from Inception

of the

Development

Stage on

September 20, 2000 through

 

2004

2003

2004

2003

June 30, 2004

 

    $

    $

   $

   $

$

Mineral Property Costs

-

  -

-

 -

  1,707


General and Administrative Expenses

         
 

Audit fees

   556

 400

  984

      951

10,120

 

Bank charges

      56

  50

  140

       73

    476

 

Consulting fees

2,500

-

2,500

-

 2,500

 

Legal fees

1,675

-

             3,400  

 10,000

33,400

 

Office and administration

    288

-

 535

 -

 4,275

 

Transfer agent and filings fees

535

 256

                880     

      256

 4,277



     5,610


      706


 8,439


 11,280


56,755


Net Loss


    (5,610)


        (706)


 (8,439)


 (11,280)


     (56,755)



Basic Loss Per Share



   0.00



 0.00



  0.00



  0.00

 


Weighted Average

Number of Shares Outstanding



8,413,738



5,000,000



7,827476



5,000,000

 

















See accompanying Notes to the Financial Statements































 DRAVCO MINING INC.

(An Exploration Stage Company)

Statement of Stockholder’s Equity

(Unaudited)



From Inception of the Development Stage on September 20, 2000 through to June 30, 2004:



 


   

Deficit

 
       

Accumulated

Total

     

Additional

During the

Stockholder’s

 

Common Stock

Paid-In

Exploration

Equity

 

Shares

Amount

Capital

Stage

(Deficiency)

   

$

$

$

$

           

Balance, September 20, 2000

-

-

-

-

         -

           

Common stock issued for cash

5,000,000

50

-

-

        50

           

Net loss for the period

-

-

-

(19,386)

 (19,386)

           

Balance, December 31, 2000

5,000,000

50

-

(19,386)

 (19,336)


Net loss for the year


-


-

-


(2,097)


   (2,097)


Balance, December 31, 2001


5,000,000


50

-


(21,483)


 (21,433)


Net loss for the year


-


-

-


(5,219)


  (5,219)


Balance, December 31, 2002


5,000,000


50

-


(26,702)


 (26,652)


Net loss for the period


-


-

-


(21,164)


 (21,614)


Balance, December 31, 2003


5,000,000


50

-


(48,316)


 (48,266)


Common stock issued for cash at $0.05 per share



4,000,000



40



199,960



-



200,000


Net loss for the period


-


-


-


  (8,439)


   (8,439)


Balance, June 30, 2004


9,000,000


90


199,960


 (56,755)


143,295









See accompanying Notes to the Financial Statements







DRAVCO MINING INC.

(An Exploration Stage Company)

Statements of Cash Flows

(Unaudited)

   



Cumulative from

Inception of the Development Stage on

 

For the Six Months Ended

June 30,

September 20,

2000 through

 

2004

2003

 June 30, 2004

 

          $

      $

     $

Cash Flows Used in Operating Activities

     
       

Loss from operations

  (8,439)

    (11,280)

      (56,755)

       

Cash provided by changes in operating assets

and liabilities

     

     (Decrease) increase in accounts payable

  2,114

         (594)

   8,040

     Advances from a related party

             -

      10,022

  43,127


Net cash used in operating activities


  (6,325)


       (1,852)


         (5,588)

       
       

Cash Flows Provided By Financing Activities

     
       

Issuance of common stock for cash

200,000

-

200,050


Net cash provided by financing activities


200,000


-


200,050

       

Increase (decrease) in cash

193,675

       (1,852)

194,462

       

Cash at beginning of period

      787

   2,537

-

       

Cash at end of period

194,462

     685

194,462      














See accompanying Notes to the Financial Statements































DRAVCO MINING INC.

(An Exploration Stage Company)

Notes to the Financial Statements

(Unaudited)



As at June 30, 2004



NOTE 1 – BASIS OF PRESENTATION


These unaudited financial statements have been prepared in accordance with the instructions to SEC Form 10-QSB. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such instructions.  These unaudited financial statements should be read in conjunction with the audited financial statements and notes thereto as at December 31, 2003.


In the opinion of the Company’s management, all adjustments considered necessary for a fair presentation of these unaudited financial statements have been included and all such adjustments are of a normal recurring nature.  Operating results for the three month and six month periods ended June 30, 2004 are not necessarily indicative of the results that can be expected for the year ended December 31, 2004.



NOTE 2 – GOING CONCERN


The Company was incorporated in the State of Nevada on September 20, 2000 as Dundee Mining Inc.  On October 2, 2002 the Company changed its name to Dravco Mining Inc.  Since inception, the Company has acquired 10 mineral claims in the Osoyoos Mining Division, Province of British Columbia, Canada.  To date, the Company has not conducted any exploration on the claims.  Management has raised funds in the quarter ended June 30, 2004 for a preliminary exploration program to assess the mineral potential of the claims, and to finance the cost of general and administrative expenses, and projected further losses from operations in the exploratory stage.


The ability of the Company to maintain its existence and further exploration of its mineral claims is dependent upon its raising sufficient new equity financing.  The commencement of principal operations is dependent upon the discovery of economically recoverable ore reserves, confirmation of the Company’s interest in the mineral claims, the ability of the Company to obtain necessary financing through the issuance of equity or debt to complete development, and on obtaining future profitable production or proceeds from the sale of all or an interest in the mineral claims.  The likely outcome of these future events is indeterminable.  The financial statements do not include any adjustments to reflect the possible future effect on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.



ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.


This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance.  Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events.   You should not place undue certainty on these forward-looking statements, which apply only as of the date of our prospectus.  These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.


We are a start-up, exploration stage corporation and have not yet generated or realized any revenues from our business operations.      


Our auditors have issued a going concern opinion.  This means that our auditors believe there is doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills.  This is because we have not generated any revenues and no revenues are anticipated until we begin removing and selling minerals.  Accordingly, we must raise cash from sources other than the sale of minerals found on the property.  That cash must be raised from other sources.  Our only other source for cash at this time is investments by others in Dravco Mining Inc.   On March 10, 2004 we completed our public offering by raising $200,000.  We sold 4,000,000 shares of our common stock at an offering price of five cents per share.

We had cash resources of $194,462 as at June 30, 2004.  We do not know how long the money will last, however, we believe that it will last twelve months.  This is dependent on the amount of exploration we conduct and the cost thereof.  We will not know that information until we begin exploring our property.  If we need additional cash and cannot raise it we will either have to suspend operations until we do raise the cash, or cease operations entirely.  Other than described in this paragraph, we have no other financing plans.

We will be conducting research in the form of exploration of our property.  We are not going to buy or sell any plant or significant equipment during the next twelve months.  We will not buy any equipment until we have located a body of ore and we have determined it is economical to extract the ore from the land.     


Plan of Operation


We are prospecting for gold. Our target is mineralized material. Our success depends upon finding mineralized material.  Mineralized material is a mineralized body that has been delineated by appropriate spaced drilling or underground sampling to support sufficient tonnage and average grade of metals to justify removal.   If we do not find mineralized material or we cannot remove mineralized material, either because we do not have the money to do it or because it is not economically feasible to do it, we may suspend or cease operations.


In addition, we may not have enough money to complete our exploration of our property.  If it turns out that we have not raised enough money to complete our exploration program, we will try to raise additional funds from a second public offering, a private placement or loans.  At the present time, we have not made any plans to raise additional money and there is no assurance that we would be able to raise additional money in the future.  If we need additional money and cannot raise it, we may suspend or cease operations.


We must conduct exploration to determine what amount of minerals, if any, exist on our properties and if any minerals that are found can be economically extracted and profitably processed.


Our property is undeveloped raw land.  Now that our offering is concluded, we intend to start exploration operations.  To our knowledge, the property has never been mined.  The only event that has occurred is the staking of the property by Locke Goldsmith and a physical examination of the property.  The cost of staking the claims was included in the $878 we paid to Mr. Goldsmith.  In addition, we paid Mr. Goldsmith $686 in 2002 and $143 in 2003 to maintain the claims in good standing. Before gold retrieval can begin, we must explore for and find mineralized material.  After that has occurred we have to determine if it is economically feasible to remove the mineralized material.  Economically feasible means that the costs associated with the removal of the mineralized material will not exceed the price at which we can sell the mineralized material.  We cannot predict what that will be until we find mineralized material.


We do not know if we will find mineralized material. We believe that activities occurring on adjoining properties are not material to our activities.  The reason is that whatever is located under adjoining property may or may not be located under our property.


Our exploration program is designed to economically explore and evaluate our properties.  

We do not claim to have any minerals or reserves whatsoever at this time on any of our properties.  


We intend to implement an exploration program that consists of core sampling. Core sampling is the process of drilling holes to a depth of up to 1,400 feet in order to extract a sample of earth.  Mr. Goldsmith will assist us in determining where drilling will occur on the property. The samples will be tested to determine if mineralized material is located on the property.   Based upon the tests of the core samples, we will determine if we will suspend operations, proceed with additional exploration of the property, or develop the property.  The proceeds from our offering are designed to only fund the costs of core sampling and testing.  We intend to take our core samples to ALS Chemex, analytical chemists, and registered assayers located in North Vancouver, British Columbia, Canada.


We estimate the cost of sampling will be $20 per foot drilled.  The amount of drilling will be predicated upon the amount of money raised in our offering.  As we have raised the maximum amount of money, we intend to drill approximately 7,000 linear feet, or up to 23 holes to a depth of 300 feet.  We estimate that it will take up to three months to drill 20 holes to a depth of 300 feet.  We intend to pay Mr. Goldsmith up to a maximum of $5,000 per month for his services during the three-month period or a maximum of $15,000.  The total cost for analyzing the core samples is estimated to be $3,000.  We had intended to begin drilling within 90 days after our financing is closed, weather permitting, however, this timeframe has been delayed as Mr. Goldsmith has been unavailable to assist us.  We do not intend to interest other companies in our property if we find mineralized materials.  We intend to try to develop the reserves ourselves.


Our claims are as follows: Cahill 5-tenure #380917, Cahill 7-tenure #380919, Cahill 9-tenure #380921 and Cahill 10-tenure #980922 to September 22, 2004.  The remaining six claims owned by the Company are valid to September 23, 2004.


Now that our financing has been completed, we intend to implement an exploration program and intend to proceed in the following three phases:


Phase 1 will begin with research of the available geological literature, personal interviews with geologists, mining engineers and others familiar with the prospect sites.  We have begun this phase of the exploration process on our properties by researching available literature over the internet and through other sources such as books and magazines.


When the research is completed, our initial work will be augmented with geologic mapping, geophysical testing and geochemical testing of our claims. When available, existing workings, like trenches, prospect pits, shafts or tunnels will be examined. If an apparent mineralized zone is identified and narrowed down to a specific area by the studies, we will to begin trenching the area.

Trenches are generally approximately 150 ft. in length and 10-20 ft. wide. These dimensions allow for a thorough examination of the surface of the vein structure types generally encountered in the area. They also allow easier restoration of the land to its pre-exploration condition when we conclude our operations. Once excavation of a trench is completed, samples are taken and then analyzed for economically potential minerals that are known to have occurred in the area. Careful interpretation of this available data collected from the various tests aid in determining whether or not the prospect has current economic potential and whether further exploration is warranted.

Phase 1 will take about 3 months and cost up to $20,000.

Phase 2 involves an initial examination of the underground characteristics of the vein structure that was identified by Phase 1 of exploration. Phase 2 is aimed at identifying any mineral deposits of potential economic importance. The methods employed are

*    more extensive trenching
*    more advanced geophysical work
*    drift driving

Drift driving is the process of constructing a tunnel to take samples of minerals for testing. Later, the tunnel can be used for mining minerals. The geophysical work gives a general understanding of the location and extent of mineralization at depths that are unreachable by surface excavations and provides a target for more extensive trenching and core drilling. Trenching identifies the continuity and extent of mineralization, if any, below the surface. After a thorough analysis of the data collected in Phase 2, we will decide if the property warrants a Phase 3 study.


Phase 2 will take about 3 months and cost up to $40,000.

Phase 3 is aimed at precisely defining the depth, the width, the length, the tonnage and the value per ton of any mineral body. This is accomplished through extensive drift driving. Phase 3 will take about 6 months and cost up to $80,000.

The breakdown of estimated times and dollars for each phase was made by the board of directors.

We do not intend to interest other companies in the property if we find mineralized materials. We intend to try to develop the reserves ourselves.

If we are unable to complete a phase of exploration because we do not have enough money, we will cease operations until we raise more money. If we cannot or do not raise additional money, we will cease operations.

We cannot provide you with a more detailed discussion of how our exploration program will work and what we expect will be our likelihood of success. That is because we have a piece of raw land and we intend to look for gold. We may or may not find any mineralized material. It is impossible to predict the likelihood of such an event.

We will not move onto a subsequent phase until the phase we are working on is completed.

We do not have any plan to take the Company from Phase 3 exploration to revenue generation until we have determined its economic feasibility.

We do not intend to hire additional employees at this time. All of the work on the property will be conducted by unaffiliated independent contractors that we will hire. The independent contractors will be responsible for surveying, geology, engineering, exploration, and excavation. The geologists will evaluate the information derived from the exploration and excavation and the engineers will advise us on the economic feasibility of removing the mineralized material.



Limited Operating History; Need for Additional Capital       


There is no historical financial information about Dravco Mining Inc. upon which to base an evaluation of our performance.   We are an exploration stage corporation and have not generated any revenues from operations.   We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in the exploration of our properties, and possible cost overruns due to price and cost increases in services.         


To become profitable and competitive, we will have to conduct research and exploration of our properties before we start production of any minerals we may find.    In the event that the funds we raised in our initial public offering is not sufficient, we have no assurance that future financing will be available to us on acceptable terms.   If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations.  Equity financing could result in additional dilution to existing shareholders.  


Results of Operations  


From Inception on September 20, 2000 to June 30, 2004        


We acquired our first property.  We have staked the property.  We completed our public offering on March 10, 2004.  We expected to begin core drilling within 90 days of completing our offering, weather permitting, but have been delayed due to the unavailability of our geologist, Locke Goldsmith.                              


Since inception, we have used our common stock to raise money for the property acquisition, for corporate expenses and to repay outstanding indebtedness.  Net cash provided by the sale of shares from inception on September 20, 2000 to June 30, 2004 was $200,050.  In addition, a related party advanced a total of $43,127 to us, which must be repaid.


Liquidity and Capital Resources       


As of the date of this report, we have yet to generate any revenues from our business operations.  We issued 5,000,000 shares of common stock through a Section 4(2) offering in September 2000 to Rodney L. Lozinski, our sole officer and director.   This was accounted for as a cash shares purchase of $50. On March 10, 2004 we issued an additional 4,000,000 shares of common stock against proceeds of $200,000 pursuant to our public offering.


Since our inception, Mr. Lozinski, has advanced the total sum of $43,127.  $30,000 was used for legal fees relating to organizational and start-up costs, $1,707 was used to pay Locke Goldsmith for the initial claims and subsequent maintenance work, $7,210 was for audit fees, $2,397 was used to pay filing fees and $1,813 was used for general administrative and operating capital.  The loan does not bear interest and has not been repaid as of the date hereof.  There are no documents reflecting the loan and they are not due on a specific date.  Mr. Lozinski will accept repayment from us when money is available.


As of June 30, 2004 we had cash resources of $194,462.  We had total liabilities of $51,167. This was comprised of the $43,127 loan from Mr. Lozinski, $5,622 for administrative and general office expenses, and $2,418 for audit fees.


ITEM 3.

CONTROLS AND PROCEDURES


We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company's Securities Exchange Act of 1934 reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to the Company's management, including its Chief Executive and Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.


As of the end of the period, the Company's management carried out an evaluation, under the supervision and with the participation of the Company's management, including the Company's Chief Executive and Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures pursuant to the Exchange Act Rule 13a-15.   Based upon the foregoing, the Company's Chief Executive and Financial Officer concluded that the Company's disclosure controls and procedures are effective in connection with the filing of the Quarterly Report on Form 10-QSB for the quarter ended June 30, 2004.


There were no significant changes in the Company's internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any significant deficiencies or material weakness of internal controls that would require corrective action.



PART II OTHER INFORMATION


Item 6.

Exhibits and Reports on Form 8-K


(a)

Reports on Form 8-K


No reports on Form 8-K were filed during the quarter for which this report is filed.


(b)

Exhibits


Exhibit 31.1 – Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Chief Executive and Financial Officer


Exhibit 32.1 – Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Chief Executive and Financial Officer








SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on this   11th day of August, 2004.




DRAVCO MINING INC.



BY:


 /s/ Rodney Lozinski

Rodney Lozinski

Principal Executive Officer and

Principal Financial Officer









ex31106300410q.htm SECTION 302 CERTIFICATION CEO AND CFO


> ENT> EX-31.1 2 ex31106300410q.htm SECTION 302 CERTIFICATION CEO AND CFO

EXHIBIT 31

EXHIBIT 31.1


SECTION 302 CERTIFICATION


I, Rodney Lozinski, certify that:


1.

I have reviewed this quarterly report of Dravco Mining, Inc.,


2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances which such statements were made, not misleading with respect to the period covered by this report;


3.

Based on my knowledge, the financial statements and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.

I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)) for the registrant and have:


a)

designed such disclosure and controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b)

evaluated the effectiveness of the registrant's disclosure and procedures and    presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and


a)

disclosed in this report any change in the registrant's control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and


5.

I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function);


a)

all significant deficiencies and material weakness in the design of operation of internal

control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weakness in internal controls; and


b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date:

August 11, 2004

  /s/ Rodney Lozinski

Rodney Lozinski

Principal Executive Officer and

Principal Financial Officer

ex32106300410q.htm SECTION 906 CERTIFICATION CEO AND CFO


> ENT> EX-32.1 3 ex32106300410q.htm SECTION 906 CERTIFICATION CEO AND CFO

EXHIBIT 32

EXHIBIT 32.1


CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002



In connection with the Quarterly Report of DRAVCO MINING INC. (the "Company") on Form 10-QSB for the period ended June 30, 2004 as filed with the Securities and Exchange Commission on the date here of (the "Report"), I, Rodney Lozinski, Chief Executive Officer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:


(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and


(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.




      /s/  Rodney Lozinski


Rodney Lozinski

Chief Executive Officer

Chief Financial Officer

August 11, 2004




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