UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS COMPANYS UNDER SECTION 12(b)
OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file no. 0001082678
ZEB ORO EXPLORATIONS INC.
(NAME OF SMALL BUSINESS COMPANY IN ITS CHARTER)
Nevada Applied for
- --------------------------------------- ------------------------------------
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
825-1200 West 73rd Avenue
Vancouver, B.C., Canada V6P 6G5
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(Address of Principal Executive Officer) (Zip Code)
(604) 267-1100
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(Company's Telephone Number)
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, par value $0.001 per share
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(Title of Class)
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TABLE OF CONTENTS
ITEM PAGE
- ---- ----
PART 1
Item 1 Description of Business 3
Item 2 Management's Discussion and Analysis or Plan of Operation 14
Item 3 Description of Property 16
Item 4 Security Ownership of Certain Beneficial
Ownership and Management 17
Item 5 Directors, Executive Officers, Promoters and
Control Persons 19
Item 6 Executive Compensation 20
Item 7 Certain Relationships and Related Transactions 21
Item 8 Description of Securities 23
PART 11
Item 1 Market Price of and Dividends on the Registrant's
Common Equity and Other Stockholders Matters 25
Item 2 Legal Proceedings 25
Item 3 Disagreement With Accountants and Financial Disclosure 25
Item 4 Recent Sales of Unregistered Securities 25
Item 5 Indemnification of Directors and Officers 26
PART F/S
Financial Statements 27
PART 111
Item 1 Index to Exhibits 36
Item 2 Description of Exhibits 36
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DOCUMENTS INCORPORATED BY REFERENCE
Documents incorporated by reference: None
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PART 1
Zeb Oro Explorations Inc. (the "Registrant" or the "Company") is filing this
Form 10-SB on a voluntary basis to:
1. provide current, public information to the investment community;
2. to expand the availability of secondary trading exemptions under the
Blue Sky laws and thereby expand the trading market in the Registrant's
securities, and
3. to comply with prerequisites for listing of the Registrant's securities
on NASDAQ.
ITEM 1. DESCRIPTION OF BUSINESS
HISTORICAL OVERVIEW OF THE COMPANY
The Registrant was incorporated on March 4, 1999. The Registrant has no
subsidiaries and no affiliated companies. The executive offices of the
Registrant are located at Suite 825 - 1200 West 73rd Avenue, Vancouver, British
Columbia, Canada, V6P 6G5.
The Registrant is engaged in the exploration of mineral properties.
(see Part 1, "Exploration and Development of the Zeb Oro Mineral Property"). The
Registrant is referred to as being in the "development" stage by its auditors.
This term is generally used in Financial Accounting Standards to describe a
company seeking to develop its ideas and products. The Registrant is not in the
development stage with regards to any mineral claim. No ore body has been
discovered and no substantial exploration has been done on its mineral claim.
The Registrant is purely an exploration company. There is no assurance that any
ore body will ever be found and that the Registrant will have sufficient funds
to undertake the exploration work required to identify an ore body.
Management anticipates that the Registrant's shares will be qualified on the
system of the National Association of Securities Dealers, Inc. ("NASD") known as
the Bulletin Board.
The Registrant has no revenue to date from the development of its
mineral property, and its ability to effect its plans for the future will depend
on the availability of financing. Such financing will be required to develop the
Registrant's mineral property to a stage where a decision can be made by
management as to whether an ore body exists and can be successfully brought into
production. The Registrant anticipates obtaining such funds from its directors
and officers, financial institutions or by way of the sale of its capital stock
in the future (see Part 1, Item 2 - "Plan of Operations"), but there can be no
assurance that the Registrant will be successful in obtaining additional capital
for exploration activities from the sale of its capital stock or in otherwise
raising substantial capital.
PLANNED BUSINESS
In addition to exploring and developing its mineral property, the
Registrant plans to seek out additional mineral properties either by way of
purchase, staking or joint venturing of other mineral properties. (See Part 1,
Item 2 - Management's Discussion and Analysis or Plan of Operation").
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Much of the discussion contained in this section is "forward looking"
in that actual results may materially differ from the Registrant's plans as
currently contemplated. Information concerning all the factors associated with
the Registrant is set forth in this Item 1 and in Items 2 and 3 below. FOR A
COMPLETE UNDERSTANDING OF SUCH FACTORS, THIS ENTIRE DOCUMENT, INCLUDING THE
FINANCIAL STATEMENTS AND THEIR ACCOMPANYING NOTES, SHOULD BE READ IN ITS
ENTIRETY.
All dollar amounts shown in this document are stated in US dollars
unless otherwise noted.
EXPLORATION AND DEVELOPMENT OF THE ZEB ORO MINERAL PROPERTY
The Registrant was retained Calvin Church, P. Geo. of Vancouver,
British Columbia, to summarize the geology and mineral potential on its mineral
claim near Zeballos, British Columbia. His report is dated April 30, 1999. The
mineral claim was staked February 11, 1999 by Edward Skoda on behalf of the
Registrant and named Zeb Oro.
The claim covers 15 metric units (375 ha) located within the Zeballos
Mining Camp near the town of Zeballos on the West Coast of Vancouver Island,
British Columbia, Canada. Auriferous quartz veins in the Zeballos mining camp
produced over 287,811 ounces of gold and 124,700 ounces of silver from ore
averaging 0.44 ounces per ton during the period 1934 to 1948 (as per 1950
Geology and Mineral Deposit of the Zeballos Mining Camp, B.C. Ministry of Mines
and Petroleum Resources, Bulletin 27).
Calvin Church's report summarizes geology and mineralization in the
Zeballos mining camp and potential for discoveries on the Zeb Oro claim. The
report is summarized in under this section of Part 1. Mr. Church has not visited
the property, which was covered in snow at the time of his writing of the
report.
LOCATION, ACCESS AND TOPOGRAPHY
The Zeb Oro mineral is situated just north of the town of Zeballos,
which is located on the West Coast of Vancouver Island about 300 kilometres
northwest of Victoria, British Columbia. The geographic center of the Zeb Oro
property is located at 126(degree)49'55" West Longitude and 50(degree)02'28"
North Latitude on N.T.S. mapsheet 92 L/2. This location may also be described as
being in U.T.M. zone 09 with coordinates Northing 5545200N and Easting 655300E.
The claim's southeast corner is in the Zeballos river valley about two
kilometers downstream of its junction with the Nomash River.
Access is by an all weather road which follows the Zeballos River and connects
Zeballos to the Island highway at Mukwilla Lake. The road crosses the southeast
corner of the property seven kilometres north of the town of Zeballos from where
steep footpaths follow creeks to higher ground in the northwest area of the
claim.
The terrain is mountainous and rugged. Elevations range from 20 meters
(75 ft) in the Zeballos River valley to above 1,030 meters (Mt. Lukwa 3,749ft)
at some of the local peaks within the mining camp. Many of the creeks flow down
waterfalls in narrow canyons and there are many unscalable bluffs which make
foot traverses difficult. The area is considered coastal rainforest and total
annual precipitation is high, rarely less than 500 centimeters (200 inches.).
Forests of yellow cedar and hemlock populate the mountaintops and Douglas fir
and red cedar grow well in the river valleys, however, much of the main
drainages were logged in the 1940's.
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CLAIM STATUS
The Zeb Oro claim was staked by Edward Skoda on behalf of the
Registrant and is registered in the Alberni Mining Division of British Columbia.
The Registrant owns the claim outright. Mineral tenure is secure for one year
from the date of staking as described below.
CLAIM NAME TENURE NO. UNITS EXPIRY DATE
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Zeb Oro 367925 15 February 11, 2000
HISTORY
J. S. Stevenson in 1950 gave a detailed account of the mining history
of the Zeballos camp in the British Columbia Department of Mines Bulletin No.27.
An edited excerpt follows:
Although small amounts of placer gold had been obtained from the
Zeballos River as early as 1907, it was not until 1924 that the first gold vein
was staked on the Tagore property. Two years later the King Midas was staked,
and by 1929 forty claims had been staked in the valley. In that year the first
shipment of ore was made. It consisted of 2 tons of high-grade ore mined from
the Tagore.
A period of inactivity followed until 1934, when the first of the rich
gold-quartz veins that to were make the Zeballos camp an important producer were
found. Small pockets of course placer gold and gold-quartz float boulders had
been found at the mouth of Spud creek. Prospecting upstream along Spud creek and
in its many tributaries resulted in discovery of the veins on the White Star
property in early 1934. In 1935, the Goldfield vein on the Spud Valley property
was found, and in 1936 the No.1 vein on the Privateer. Several discoveries
followed shortly after on Spud Creek and other creeks draining into the Zeballos
River.
Mining really began in the winter of 1934-35 when high-grade ore was
shipped from the property of White Star Gold Mines. In 1937 shipments of ore
were made from the No.1 vein on the Privateer. In 1938 the Privateer mill and
Spud Valley Gold Mines mill began operating. That year nearly 400 men were
employed at thirty properties in prospecting, development work, and production.
In 1939 mills were built at the Mount Zeballos and Central Zeballos mines, and
in 1941 a mill was built at the Homeward. About 1942, the shortage of men and
supplies because of World War II forced all but the Privateer and Prident to
close, and in October 1943, these properties also were forced to close. During
the winter of 1945-46 operations were resumed at Privateer, Prident, Central
Zeballos, and Spud Valley mines, but owing to the increased cost of supplies and
labor relative to the fixed price of gold, these mines were forced to close
again and by the end of 1948 Privateer, the last to operate, had ceased
operations.
Production from the Zeballos mining camp between 1934 and 1948 totaled
287,811 ounces gold and 124,700 ounces silver from approximately 651,000 tons of
ore mined as sedt forth in the following Table. This gives an over all grade for
the camp, including dilution, of 0.44 ounces gold per ton; or, based on a yield
of 280,623 ounces from the ore milled, an average of 0.75 ounces per ton milled.
The narrow veins were mined by cut-and-fill and shrinkage methods and resulted
in lower grades due to dilution in areas where stoping widths exceeded vein
widths. This is clearly evident from production figures of the largest producer
in the camp, Privateer, where the average grade based on total production of
154,381 ounces of gold from 285,771 tons
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mined and 153,332 tons milled was 0.54 ounces gold per ton mined and 1.01 ounces
gold per ton milled. Production figures for the major gold producers in the camp
are listed below as derived from J.S. Stevenson's article noted above.
ZEBALLOS GOLD PRODUCTION (OUNCES), 1934 TO 1948
<TABLE>
<CAPTION>
1934- 1944-
PRODUCER 1937 1938 1939 1940 1941 1942 1943 1948 Total
- -------- ---- ---- ---- ---- ---- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Privateer 3,003 16,023 32,987 28,416 28,328 17,219 9,727 22,678 154,381
Spud Valley * 47 473 15,369 18,099 14,031 6,020 54,039
Mount Zeballos 3,277 14,716 9,744 2,665 123 30,525
Central Zeballos 152 33 6,610 6,568 4,610 2,499 20,472
Prident 3,803 5,141 3,758 1,235 13,937
White Star 541 42 2,122 2,345 1,531 500 7,081
C.D. (Rey Oro) 1,102 843 1,319 1,336 4,600
Homeward 897 594 1,491
Van Isle 1,178 1,178
Rimy 44 44
Tagore 8 38#
Golden Portal 8 12 20
King Midas 5 5
---- ------ ------ ------ ------ ------ ------ ------ -------
Totals 3591 17,836 54,647 72,700 62,238 36,749 13,608 26,412 287,811
==== ====== ====== ====== ====== ====== ====== ====== =======
</TABLE>
- ---------------------
* Including production from Big Star.
# Includes 30 oz. produced in 1930 and 1932.
The Zeb Oro claim overlies a block of reverted crown granted claims on
its north boundary, which outline the Ford Iron Deposit formerly named the
F.L/Ridge claims. Replacement bodies of almost pure magnetite were mined from
this deposit between 1962 and 1969 mostly by underground methods. The deposit
produced 1,282,233,396 kilograms of iron concentrate from 1,681,283 tonnes
mined.
Several prospects lie within or on the claim boundaries of the Zeb Oro
claim. The prospects were all staked and explored initially between 1936 and
1939 and have seen little activity since. Most of this early work consisted of
surface stripping and a number of open cuts or short adits driven on high-grade
veins. More extensive workings were developed on the Maquinna Vein where a total
of six adits and numerous surface workings traced the vein over 670
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metres. The only recorded production came from the Cordova Vein in 1939 when 156
grams of gold, 31 grams of silver and 4 kilograms of copper were recovered from
1.0 tonne of ore. Detailed accounts of these early exploration programs were
recorded by M.F. Bancroft in 1940 in an article entitled "Zeballos Mining
District and Vicinity" Geological Survey of Canada, Pages 40-12 and in Annual
Reports of the Minister of Mines for British Columbia during that period.
REGIONAL GEOLOGY
Geologists from the Geological Survey of Canada, beginning with G.M.
Dawson (1887), carried out the earliest geological investigations of Vancouver
Island. D.H. Gunning made important contributions to the geological picture when
he completed a systematic geological survey in 1932 of the Nimpkish and Woss
lake areas of northern Vancouver Island. A compilation of Gunning's work was
combined with investigations by J.W.Hoadley and published as GSC Memoir 272:
Geology and Mineral Deposits of the Zeballos-Nimpkish Area in 1953. The
geological mapping of several geologists working for the Geological Survey of
Canada in the 1960's was compiled at a scale of 1:250,000 by J.E. Muller (1977)
and published as GSC Open File 463.
Vancouver Island is the main component of the Insular Belt, the
westernmost major tectonic subdivision of the Canadian Cordillera. The Insular
Belt contains a middle Paleozoic and a Jurassic volcanic-plutonic complex, both
apparently underlain by gneiss-migmatite terranes and overlain respectively by
Permo-Pennsylvanian and Cretaceous clastic sediments. A thick shield of Upper
Triassic basalt, overlain by carbonate clastic sediments, separates these two
complexes in space and time. In the Zeballos-Nimpkish lake area Gunning (1932)
defined this volcanoclastic sequence the Vancouver Group. The Vancouver Group is
intruded by various bodies of the Coast Plutonic Complex which were emplaced
from late Jurassic to early Cretaceous time. Post orogenic Tertiary clastic
sediments fringe the West Coast.
STRATIGRAPHY
The volcanic and sedimentary rocks of the Vancouver Group comprise a
conformable series that strikes, in general, northerly to northwesterly and dips
westward to southwestward. Consequently the oldest rocks are found to the east
and the youngest to the west. Upper Triassic Karmutsen volcanics (muTRK) form
the base of the Vancouver Group and consist of a thick series of medium to
basic, highly amygdaloidal volcanic flows, with very little interbedded
sedimentary material. Except in contact zones with granitic intrusions the
volcanics exhibit low-grade metamorphism. The basaltic eruptions started with
pillow lavas in a deep marine rift basin, continued with aquagene tuff and
breccia as the basin became shallower, and terminated with subareal basalt
flows.
Conformably above the Karmutsen Formation is the Quatsino Formation
(uTRQ), which is composed of massive to thickly bedded white to blue crystalline
limestone. Poorly preserved ammonite fossils from the Quatsino limestone
indicates an Upper Triassic age. The succeeding Parson Bay Formation (uTRPB) is
composed of interbedded calcareous black argillite, calcareous greywacke and
sandy to shaly limestone. A general coarsening of grain size is seen moving
upward in the stratigraphic succession. The Bonanza Group (IJB) was originally
named by H. C. Gunning in 1931 in his preliminary report on the Nimpkish Lake
Quadrangle on Vancouver Island published in the Geological Survey of Canada,
Summary Report 1931, Part A and included an upper unit composed of mainly
rhyolitic and basaltic tuffs and breccias. In 1977 J. E. Muller, in an article
published in the Geological Survey of Canada, Open File Report 463, had
reclassified the lower calcareous sedimentary unit as belonging to the Parsons
Bay Formation.
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The Bonanza represents several eruptive centres of a volcanic arc and
consequently its stratigraphy varies considerably.
INTRUSIVES
Most of the intrusive rocks on Vancouver Island form part of the Coast
Intrusions, which range in composition from quartz diorite to granite and were
emplaced during Jurassic or Cretaceous time. On northern Vancouver Island these
intrusive rocks form regional patterns of narrow northwest trending belts
separated by slightly wider belts of Upper Triassic volcanic and sedimentary
rocks. On the west side of the island the pattern is more pronounced where a 3
kilometre wide belt, just west of Nimpkish Lake, has been traced southeast to
Vernon Lake, a distance of 80 kilometres. Within the Vancouver and Bonanza
Groups the intrusives form sills, dykes and high level stocks of
hornblende-quartz-feldspar porphyry and there is an apparent comagmatic
relationship between intrusions and volcanics. Much of the economic
mineralization within the Zeballos mining camp was developed in or in close
association to these intruding batholiths and stocks.
STRUCTURE
The structures of northern Vancouver Island are probably due to several
periods of deformation occurring from late Mesozoic to early Tertiary time.
Vancouver Group rocks are folded into broad regional anticlinoria and
synclinoria that strike northwesterly and have average trough to crest distances
of 11 to 16 kilometres. A well-developed synclinal structure was mapped between
Bonanza and Nimpkish lakes however the fold pattern becomes increasingly
disrupted toward the southwest. The regional structure in the Zeballos map area
is complex due to the predominance of intrusive bodies that disrupt the broad
folds. In 1953, J. W. Hoadley described , in his article entitled "Geology and
Mineral Deposits in the Zeballos-Nimpkish Area, Vancouver Island, British
Columbia" in the Geological Survey of Canada, Memior 272, 82 pages, these
structures as follows:
" In the vicinity of major batholithic intrusive bodies, regional
structures have been largely obliterated or masked by secondary
structures imposed during intrusion. Where the intrusions have invaded
volcanic rocks, general upwarping and relatively mild folding are
observed, and some of the smaller roof pendants have, apparently, been
tilted en masse from their original position. However, where the
intrusive bodies have invaded the Quatsino limestone or the sedimentary
part of the Bonanza Group (Parson Bay Formation), the degree of
secondary folding is much more pronounced. The rocks are intricately
folded or overturned, and, in places, recumbent folds are common."
Several major north or northwest trending fault zones are mapped in the
Zeballos map area. The most pronounced fault follows the North Fork of the
Zeballos River and trends slightly west of north and dips steeply east where
observed. This fault is thought to be later than steeply dipping east to
east-northeast striking cross faults.
PROPERTY GEOLOGY
Detailed geological mapping of the Zeballos Mining Camp was completed
by J.S. Stevenson in 1950 and published by the British Columbia Department of
Mines as Bulletin No.27. Mesozoic volcanics and sediments of the Vancouver Group
outcrop and are intruded by Coast intrusives of probable Jurassic age over this
relatively small area (58 km(2)). Geological
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mapping by Stevenson did not attempt to make regional correlations but instead
used lithology of the rocks to define the mappable units.
The volcanic and sedimentary rocks comprise a conformable series that
strikes north-northwest and dips south to southwesterly so that the oldest rocks
are found to the east and the youngest to the west. Andesitic lava of the
Karmutsen volcanics outcrop west of the North Fork of the Zeballos river and
represent the oldest mapped unit. Massive limestone of the Quatsino Formation
overlies the lava to the west along Contact creek. A large assemblage of
volcanics, mainly pyroclastics and minor flows of the Bonanza Formation,
overlies the limestone conformably to the west and outcrops over the southwest
quadrant of the mining camp. A northwesterly belt of Coast intrusives that
include, from oldest to youngest, gabbro and hornblende diorite, granodiorite,
quartz diorite, and several varieties of dykes, invade the stratified rocks. The
intrusives are a dominant feature within the Zeballos mining camp and as most
mineral deposits are associated with it, is of considerable economic and
geological interest.
The major structure of the area is a monoclinal fold that strikes
northwest and dips 40 to 60 degrees southwest. This fold is modified by a major
northwest trending dragfold between Lime and Contact creeks in which the crest
follows Lime creek and the trough follows the ridge 600 metres to the east.
Minor dragfolds occur near contacts with the quartz diorite. A major northerly
trending fault of indeterminate displacement follows the North Fork of the
Zeballos River and appears to dip vertical or steeply east. About 800 metres up
Fault Creek from the junction with the North Fork is a second fault of major
importance. The fault strikes east-southeast and dips steeply north-northeast
offsetting the west dipping contact between Quatsino limestone and Karmutsen
volcanic rocks about 600 metres to the west on the south side of the fault.
MINERALIZATION AND ALTERATION
Mineral deposits of the area include gold-bearing quartz veins and high
temperature replacement (skarn) or contact metamorphic deposits in limestone or
calcareous sedimentary rocks. Deposits of the latter type are confined to areas
where Quatsino limestone and sedimentary parts of the Karmutsen and Bonanza
group rocks have been invaded by Coast intrusions. The replacements typically
contain chiefly magnetite with lesser amounts of pyrrhotite (F.L., Ridge,
Churchill) or they contain mainly chalcopyrite and only minor magnetite and
pyrrhotite (Maquinna and Central Zeballos) and sometimes appreciable gold
(Beano). In the Ford skarn deposit a 21 metre thick tabular body of magnetite
follows a limestone-tuff contact and has been traced along 400 metres of strike.
Auriferous gold-bearing veins of the Zeballos camp are
characteristically narrow, with widths less than one foot (30 cm), but commonly
contain gold in excess of one ounce to the ton (35 g/tonne). Some of the veins
occur in sheeted zones up to 4 feet (1.2 m) wide that may pinch and swell along
strike forming lenticular quartz-sulphide zones (Goldfield Vein). The veins
follow fairly continuous fault fissures and are often banded by an alternation
of quartz and sulphides where the abundance of sulphide varies from 10 to 50
percent and averages about 25 percent. Sulphides, in order of abundance are
pyrite, sphalerite, arsenopyrite, chalcopyrite, galena, pyrrhotite, and
occasionally marcasite.
The producing mines in the camp were located at the northwest end or
nose of the quartz diorite intrusive body and related to structural deformation
and mineralization there. It has been found that veins, or parts of veins, that
follow the direction of tension in any fracture pattern are
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the most favourable for the localization of ore. A study of fracture patterns in
the Zeballos camp by J. S. Stevenson in 1950 determined that veins that strike
close to north 62 degrees east and dip vertically were formed by tension and
thus most likely to contain higher grade oreshoots. This discovery has been
proven by practical experience where several high grade veins (Privateeer No.3,
Goldfield Vein) and gash veins in the Zeballos camp are orientated in this
direction.
On the Zeb Oro claim there are more than six sheared-vein showings of
limited extent containing minor amounts of gold and base metals. The shears
zones are generally less than one metre wide, strike 052 to 090 degrees, and dip
steeply north or south. The quartz veins within the shears are usually 5 to 30
centimetres wide and mineralized with pyrite-arsenopyrite and lesser amounts of
pyrrhotite, sphalerite and galena. Coast intrusive phases, ranging in
composition from diorite to granodiorite, host most of the veins on the property
or are spatially related to gold-quartz veining in intruded volcanic rocks of
the Bonanza Group.
The Maquinna Vein is one of the more developed showings on the property
and has been traced on surface and underground for over 640 metres. Locally the
vein is ribboned and ranges up to 1 metre in width with values up to 21.3
grams/tonne. Many of the veins on the property are oriented in directions of
maximum shear stress (090(degree)) and as such there is a predominance of broken
quartz fragments and gouge within the shears. Directly south (250 m),
chalcopyrite-magnetite mineralization hosted in a silicified lens of Quatsino
limestone has been explored by a series of open cuts and a short adit. These
showings, formerly known as the Blackbird/Jack O'Spades property, represent
skarn replacement mineralization.
CONCLUSIONS MADE BY CALVIN CHURCH IN THIS REPORT.
o The Zeb Oro property is situated within the Zeballos mining camp that
includes a number of former producing lode gold mines including the
Privateer and Spud Valley mines. Together these mines produced 287,811
ounces of gold and 124,700 ounces of silver from 651,000 tons of ore mined
giving an over all grade for the camp of 0.44 ounces gold per ton.
o Most of the production came from gold-bearing veins less than one foot
(30cm) wide and because the veins were much narrower than stoping widths
dilution of the ore was quite high especially in areas of highly sheared
wall rock. Thus the actual grade of many of the producing veins in the camp
are commonly higher than one ounce per ton.
o Auriferous quartz veins occur in the border phases of the intrusive rocks
and in the adjacent host rocks although there are isolated occurrences of
gold-bearing veins up to one mile (1.6 km) from any known intrusive contact.
o The veins are commonly banded by an alternation of sulphides and quartz
indicating several episodes of mineralization. Sulphides are common in most
of the Zeballos veins comprising 10 to 50% of the vein material. In
quartz-sulphide ores the gold content increases in proportion to sulphide
content and the presence of galena or sphalerite probably due to a late
pulse of mineralization.
o Studies of structural deformation in the quartz diorite intrusive indicate
that veins which developed parallel to the plane of tension (062(degree)/90)
contain the highest grade oreshoots. Veins that developed along planes of
maximum shearing stress (035(degree)/90 and 090(degree)/90) tend to be lower
grade and contain abundant rock fragments and gouge.
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o High temperature replacement deposits (skarns) are found along contacts
between Coast intrusive rocks and limestone or calcareous sediments within
the Zeballos mining camp. The Ford deposit produced 1,282,233,396 kilograms
of iron concentrate from 1,681,283 tonnes of ore mined from massive
replacement bodies of massive fine-grained magnetite.
RECOMMENDATIONS
o Airphoto interpretation and reconnaissance mapping is required to determine
structural breaks and intersecting fault structures very important to ground
preparation and the formation of mineral deposits in the area.
o Construction of a soil geochemical grid across structural features sampled
at 20 metre intervals on lines spaced 100 metres apart. Major northeast
striking stratigraphic contacts and shear zones should be prospected and the
grids orientated perpendicular to them should they appear to be mineralized.
If terrain conditions prohibit establishing a grid, closely spaced contour
sampling traverses should be considered.
o Ground geophysical surveys using VLF-EM and magnetometer instruments to
locate less obvious linear features (faults), geological contacts and
mineralized horizons.
o Prospecting and detailed geological mapping at 1:2000 scale or better over
the entire claim area. Prospecting could be prioritized according to
favorable geologic contacts especially where VLF-EM conductors have already
been identified.
o Providing favorable results are obtained in the soil geochemical sampling
program additional exploration consisting of trenching and drilling would be
recommended to target anomalies from that program.
REGISTRANT'S MAIN PRODUCT
The Registrant's primary product will be the exploration and
development of its mineral property which might eventually result in the sale of
minerals, both precious and commercial. The Registrant is not at the stage of
development whereby minerals can be mined and sold thereby giving the Registrant
a cash flow.
Registrant's Exploration Facilities
The Registrant will be exploring and developing its mineral claims
initially in the Zeballos area of British Columbia and does not plan to build
any mill or smelter until such time as a production decision is made. This will
be several years into the future before the need to build a permanent facility
is warranted. During the exploration period, the Registrant will use tent
facilities to house its geological workers since this will be by far the most
economic way to proceed.
RISK INHERENT IN MINERAL PROPERTIES
There are certain inherent risks with mineral properties from the point
of view of the Registrant and its shareholders as follows:
1. The Zeb Oro claim does not contain a known body of commercial ore and,
therefore, any program conducted on these properties would be an
exploratory search of ore.
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2. There is no certainty that any expenditures made in the exploration of
the Zeb Oro property will result in discoveries of commercial
quantities of ore. Most exploration projects do not result in the
discovery of commercially mineable deposits of ore.
3. Resource exploration and development is a speculative business since
there is no assurance after the initial funds are raised that the
Registrant can raise any further funds from the market place.
4. Failure to discover mineral deposits but from finding mineral deposits
which, though present, are insufficient in size or grade to return a
profit from production. The marketability of any minerals acquired or
discovered may be affected by numerous factors which are beyond its
control and which cannot be accurately predicted, such as market
fluctuations, the proximity and capacity of milling facilities, mineral
markets and processing equipment, and such other factors as government
regulations, including regulations relating to royalties, allowable
production, importing and exporting of minerals, and environmental
protection. The mineral industry is intensely competitive and the
Registrant competes with other companies that have greater resources.
5. Mining operations generally involve a high degree of risk. Hazards such
as unusual or unexpected formations and other conditions are involved.
The Registrant may become subject to liability for pollution, cave-ins
or hazards against which it cannot insure or which it may not elect to
insure. The payment of such liabilities may have a material, adverse
effect on the Registrant's financial position.
6. Prior to commencing mining operations on any of its properties, the
Registrant must meet certain stringent environmental requirements.
Compliance with these requirements may prove to be difficult and
expensive. Fortunately the Registrant is currently in the exploration
stage where a system of constructing grids and soil sampling will be
the first exploration procedure. Under the Mines Act of British
Columbia, the Registrant is not required to complete an application for
submission to the district inspector. No bond will have to be posted
with the mining branch to ensure environmental clean up. Nevertheless,
the Registrant will be required to file an application if it decides to
continue exploration activities by either trenching, bulk sampling,
drilling or developing an adit. A bond, the amount to be determined by
the district inspector, will have to be posted to ensure adequate clean
up of the site upon abandonment. At this point the Registrant will have
to prepare a detailed application that will include a deactivation or
reclamation plan. The reclamation plan will have to be completed within
one year of cessation of exploration unless otherwise approved by the
district inspector. At this time, management is unable to assess the
financial impact of any environmental damage other than knowing that
the posted bond will be forfeited in full if the Registrant does not
complete the reclamation correctly.
7. While the Registrant has obtained the usual industry standard title
reports with respect to the Zeb Oro claim, this should not be construed
as a guarantee of title. This property may be subject to prior
unregistered agreements or transfers or native land claims and title
may be affected by undetected defects. Certain of the claims may be
under dispute and resolutions of a dispute may result in the loss of
all of such property or a reduction in the Registrant's interest
therein.
8. The Zeb Oro claim has never been surveyed and, accordingly, the precise
location of the boundaries of the property and ownership of mineral
rights on specific tracts of land comprising the property may be in
doubt.
12
<PAGE>
1. OTHER MINERAL PROPERTIES
The Registrant has not identified any other mineral properties either
for staking or purchasing.
EMPLOYEES
As at April 30, 1999, the Registrant did not have any employees either
part time or full time. Initially the Registrant will not wish to bear the
burden of carrying full time employees especially during periods when it is
difficult to work on the property due to weather conditions. Nevertheless the
executive officers undertook the responsibility of initially identifying a
mineral property of merit, incorporating the Registrant, obtaining the
assistance of professionals as needed, identifying potential investors to
contribute the initial "seed capital", coordinating various filing requirements
and other matters normally performed by the executive officers. They were not
paid for these services in cash by the Registrant but the Registrant has given
recognition in the financial statements to this contribution by expensing $1,000
for services of the President and crediting capital contribution of a like
amount.
The Registrant is not a party to any employment contracts or collective
bargaining agreements. The British Columbia area has a relatively large pool of
people experienced in exploration and development of mineral properties; being
mainly geologists and mining consultants. In addition, there is no lack of
people who have experience in working on mineral properties either as laborers
or prospectors. The Registrant will use independent workers and consultants
initially on a part time basis.
COMPETITION
In Canada there are numerous mining and exploration companies, both big
and small. All of these mining and exploration companies are seeking properties
of merit and availability of funds. The Registrant will have to compete against
such companies to acquire the funds to develop its mineral claims. The
availability of funds for exploration is sometimes limited and the Registrant
might find it difficult to compete with larger and more well-known companies for
capital. Even though the Registrant has the rights to the mineral on its claims
there is no guarantee it will be able to raise sufficient funds in the future to
maintain its mineral claims in good standing. Therefore, if the situation occurs
that it does not have sufficient funds for exploration the claims might lapse
and be staked by other mining interests. The Registrant might be forced to seek
a joint venture partner to assist in the development of its mineral claims. In
this case, there is the possibility that the Registrant might not be able to pay
its proportionate share of the exploration costs and might be diluted to an
insignificant carried interest.
Even when a commercial viable ore body is discovered, there is no
guarantee competition in refining the ore will not exist. Other companies may
have long term contracts with refining companies thereby inhibiting the
Registrant's ability to process its ore and eventually market it. At this point
in time the Registrant does not have any contractual agreements to refine any
potential ore it might discover on its mineral claims.
The exploration and development business is highly competitive and
highly fragmented, dominated by both large and small mining companies. Success
will largely be dependent on the Registrant's ability to attract talent from the
mining field. There is no assurance that the Registrant's mineral expansion
plans will be realized.
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<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OR PLAN OF OPERATION
The discussion contained in this Item 2 is "forward looking" in that
actual work performed on the Registrant's mineral property may differ from the
recommended work program as set forth in the geological report dated April 30,
1999 prepared by Calvin Church, P.Geo.. Factors that could cause the work
program to differ are described throughout this Form.
PLAN OF OPERATION
To date the Registrant has concentrated on the Zeb Oro claim. In the
future, the Registrant will seek to investigate other mining properties to
determine which ones are of merit and are of interest to the Registrant. Subject
to the availability of financing, the Registrant will seek to increase its
inventory of mineral properties and, if acceptable to management, enter into
joint venture agreements to develop various other mineral properties of merit.
(See Part 1, Item 1 - "Description of the Business"). The Registrant will seek
to generate such funds through the sale of securities and/or institutional
financing. If an underwriter can be found, a public offering of common stock
will be considered; alternatively the Registrant will seek to raise funds
through a private offering of securities to an institutional buyer or through a
registered broker dealer. The Registrant does not presently have any financing
arranged for nor has any underwriter yet expressed interest in such an offering,
and there can be no assurance that an underwriter can be found on terms
acceptable to the Registrant. In the absence of such financing, the Registrant
may be unable to put its plans into effect.
LIQUIDITY AND CAPITAL RESOURCES
As at April 30, 1999, the Registrant had $9,811 of assets, and $3,345
of liabilities. The cash equivalent as at April 30, 1999 was $9,811.
The Registrant has no contractual obligations for either lease
premises, employment agreements or work commitments on the Zeb Oro claim and has
made no commitments to acquire any asset of any nature.
Operational and administrative expenses of the Registrant for 1999 are
projected to be approximately $4,500 which will comprise audit ($1,500), filing
fees with regulatory authorities -Edgar ($1,200), transfer agent's fees ($1,000)
and miscellaneous ($750). The Zeb Oro claim is in good standing until February
2000 and if warranted the Registrant need not spend any money on its claim until
that date. The current cash position is sufficient to pay the above noted
expenses and if required the officers and directors can advance additional funds
to the Registrant.
Since March 4, 1999, the date of inception, the Registrant has incurred
the following expenses:
Accounting and audit (1) $ 2,250
Bank charges (2) 75
Geology report (3) 1,200
Incorporation costs written-off (4) 670
Management fee (5) 1,000
Office and miscellaneous (6) 175
Rent (7) 600
Staking costs (8) 368
14
<PAGE>
Telephone (9) 200
Transfer agent's fees (10) 2,296
---------
Total expenses for the period $ 8,834
=========
(1) Audit fee - $2,250
The Registrant had its financial statements audited as at April 30, 1999, as
attached to this Form 10-SB, for a fee of $1,500. In addition, accounting
services in the preparation of a working paper file and the accounting
records of the Registrant resulted in an invoice of $750.
(2) Bank changes - $75
Monthly service charges for operating the account as charged by the Bank of
Montreal.
(3) Geology report - $1,200
The Registrant engaged the services of Calvin Church, P. Geo., to write a
report to the Registrant detailing the mineralization on the Zeb Oro claim
and recommending a future work program. This report was completed on April
30, 1999 and has been summarized in part in this Form under the heading of
"Exploration and Development of Zeb Oro Mineral Property."
(4) Incorporation costs written-off - $670
The Registrant has treated the costs of incorporation as period costs and
has written them off as an expense in the current period rather than
capitalize them and amortize them over a period of time.
(5) Management fee - $1,000
The Registrant has not paid any fees to its directors or officers during the
current period. Nevertheless, the Registrant realizes that there is a cost
involved in the directors and officers devoting time and effort to the
affairs of the Registrant. Therefore, a management fee of $1,000 has been
expensed and credited to capital contribution during the current period.
(6) Office and miscellaneous - $175
Office and miscellaneous represents the printing of cheques for use by the
Registrant, photocopying, courier and fax charges for the period.
(7) Rent - $600
The Registrant uses the personal residence of the President of the
Registrant as an office. No charge has been incurred by the Registrant.
Nevertheless, the Registrant recognizes that there is a cost to using an
office and therefore has expensed $600 and credited to capital contribution
a similar amount.
(8) Staking costs - $368
The Registrant engaged the services of Edward Skoda to stake the Zeb Oro
claim in the Zeballos area of British Columbia. Mr. Skoda invoiced the
Registrant for his staking and recording costs.
(9) Telephone - $200
15
<PAGE>
The Registrant has not incurred any telephone charges to date. Nevertheless,
the Registrant recognizes the fact that there is a telephone cost to
operating a business and therefore has expensed $200 with an offsetting
credit to capital contribution. This expense was determined on the fair
market value of obtaining a telephone line and operating for a three month
period.
(10) Transfer agent's fees - $2,296
Transfer agent's fees comprise $1,200 as the annual fee paid to maintain an
account with the transfer agent and $1,096 for preparation and issuance of
share certificates. The Registrant has treated for accounting purposes the
annual fee of $1,200 as a period cost and has written it off in the current
period rather than amortizating it over the entire year.
Management feels that its present cash position after the payment of
all outstanding accounts payable is sufficient to meet its present needs other
than undertaking any exploration program on the Zeb Oro claim. To maintain the
Zeb Oro claims in good standing for an additional year, being to February 2001,
would result in cash been spent in the amount of approximately $1,000. Other
expenses required by the Registrant in the immediate future would be for
accounting, transfer agent charges, office expenses and audit. If the Registrant
wishes to explore the Zeb Oro claim it will require additional funds. These
funds might be provided by the directors and officers, by way of bank financing
or the selling of the Registrant's capital stock. No consideration, at this
time, has been given to the raising of additional funds.
Management does not believe the Company's operations have been
materially affected by inflation.
ITEM 3. DESCRIPTION OF PROPERTY
The Zeb Oro claim consists of one 15 unit metric claim situated within
the Zeballos mining camp near the town of Zeballos about 300 kilometres
northwest of Victoria, British Columbia. The property is 100 percent owned by
Zeb Oro Explorations Inc.
The Zeballos mining camp was a significant gold producer between 1934
and 1948 and achieved total output figures of 287,811 ounces of gold and 124,700
ounces of silver during that time. Typically gold and silver was mined from
high-grade ore shoots in auriferous quartz veins averaging less than one foot
(30cm) wide along fairly continuous strike lengths. The overall grade for the
camp was approximately 0.44 ounces gold per ton mined however the actual grade
of most veins before dilution from mining is much higher (> 1.0 oz/ton).
Gold-bearing quartz veins developed in shear zones near border phases
of intrusive rocks and in adjacent host rocks. Shearing patterns and related
planes of tension that developed in the intrusive bodies due to their structural
deformation were important to the localization of economic accumulations of
gold. High-grade ore shoots formed in veins and tension gashes with an
orientation of 062(degree)/90. In quartz-sulphide ores the amount of gold is
proportional to the amount of sulphide and the presence of galena and
sphalerite.
Many of the mineralogical associations and structural patterns found in
the area of the former producing mines in the Zeballos mining camp are evident
in the area of the Zeb Oro claim. Although gold-bearing veins on the property
are considered to be too small or low grade to be economic the potential for new
discoveries is possible. An exploration program including reconnaissance
mapping, geophysics and geochemical sampling is recommended to determine the
16
<PAGE>
extent of the mineralizing system on the Zeb Oro property. Further programs of
trenching and drilling are recommended contingent on favorable results of each
preceding exploration phase.
OFFICES
The Registrant's executive offices are located at 825 - 1200 West 73rd
Avenue, Vancouver, British Columbia, Canada. The office is located in the
offices of the President of the Registrant which are used to transact business
of his other business interests. There is no charge to the Registrant for office
but an imputed charge of $600 has been expensed during the current period with
an offsetting entry to capital contribution. The Registrant realizes it will
eventually be required to contribute its fair share to office rent. No
discussions between the directors has taken place to date to decide upon the
terms and conditions of the office rent.
INCORPORATION IN THE STATE OF NEVADA
The Registrant incorporated in the State of Nevada rather than British
Columbia mainly due to the tax reasons. In British Columbia the province has a
capital tax based on the issued and outstanding shares. This is an annual tax.
In addition both the Federal and Provincial Governments impose tax on any
profits made. This tax could range as high as 51% of net income. By having a
Nevada based company the Registrant will only be subject to a 15% withholding
tax as set forth in the Canada/ US Tax Treaty. The State of Nevada has no
corporate tax.
OTHER PROPERTY
The Registrant does not own any other property other than the rights to
the minerals located on the Zeb Oro claim.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERSHIP AND MANAGEMENT
SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information with respect to the
beneficial ownership of each person who is known to the Registrant to be the
beneficial owner of more than 5% of the Registrant's Common Stock as of April
30, 1999.
(1) (2) (3) (4)
Title Name and Address Amount and Nature Percent
of of Beneficial of Beneficial of
Class Owner Ownership (1),(2) Class (2)
- ----- ----- ----------------- ---------
Common STEVEN BRUCE 2,500,000 (i) 22.68%
Shares 825 - 1200 West 73rd Avenue
Vancouver, B.C.
Canada, V6P 6G7
Common MICHAEL J. KENNAUGH 2,500,000 (ii) 22.68%
Shares 42 - 2951 Panorama Drive
Coquitlam, British Columbia
Canada, V3E 2W3
17
<PAGE>
(1) As of April 30, 1999 there were 11,025,000 common shares outstanding.
Unless otherwise noted, the security ownership disclosed in this table is
of record and beneficial.
(2) Under Rule 13-d under the Exchange Act,
shares not outstanding but subject to options, warrants, rights, conversion
privileges pursuant to which such shares may be acquired in the next 60
days are deemed to be outstanding for the purpose of computing the
percentage of outstanding shares owned by the persons having such rights,
but are not deemed outstanding for the purpose of computing the percentage
for such other persons.
(i) Steven Bruce, the President and Director of the Registrant, purchased
for cash 2,500,000 shares at a price of $0.001 per share. These shares
were issued pursuant to the exemption from registration under Section
4(2) of the Securities Act of 1933, as amended. Each of the share
certificates has the appropriate legend restricting its sale and
transfer.
(ii) Michael J. Kennaugh, a director of the Registrant, purchased for cash
2,500,000 shares at a price of $0.001 per share. These shares were
issued pursuant to the exemption from registration under Section 4(2)
of the Securities Act of 1933, as amended. Each of the share
certificates has the appropriate legend restricting its sale and
transfer.
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth certain information with respect to the
beneficial ownership of each officer and director, and of all directors and
executive officers as a group as of April 30, 1999.
(1) (2) (3) (4)
Title Name and Address Amount and Nature Percent
of of Beneficial of Beneficial of
Class Owner Ownership (1),(2) Class (2)
----- ----- ----------------- ---------
Common STEVEN BRUCE 2,500,000 (3) 22.68%
Shares 825 - 1200 West 73rd Avenue
Vancouver, B.C.
Canada, V6P 6G5
Common MICHAEL J. KENNAUGH 2,500,000 (3) 22.68%
Shares 42 - 2951 Panorama Drive
Coquitlam, British Columbia
Canada, V3E 2W3
Common CAROL KRUSHNISKY NIL (3) 0.00%
Shares 1070 Eden Crescent
Delta, B.C.
Canada, V4L 1W7
All officers and directors as a 5,000,000 45.36%
group (three persons)
8 As of April 30, 1999, there were 11,025,000 common shares outstanding.
Unless otherwise noted, the security ownership disclosed in this table is
of record and beneficial.
(2) Under Rule 13-d under the Exchange Act, shares not outstanding but
subject to options, warrants, rights, conversion privileges pursuant to
which such shares may be acquired in the next 60 days are deemed to be
outstanding for the purpose of computing the percentage of outstanding
shares owned by the persons having such rights, but are not deemed
outstanding for the purpose of computing the percentage for such other
persons. None of the directors or officers have any options, warrants,
rights or conversion privileges outstanding.
18
<PAGE>
(3) Mr. Bruce is President and a Director of the Registrant and one of the
controlling shareholders. This stock is restricted since it was issued
in compliance with the exemption form registration provided by Section
4 (2) of the Securities Act of 1933, as amended. After this stock has
been held for one (1) year, Mr. Bruce could sell a percentage of his
shares every three months based on 1% of the outstanding stock.
Therefore, this stock cannot be sold except in compliance with the
provisions of Rule 144.
Mr. Kennaugh is a Director of the Registrant and one of the controlling
shareholders. This stock is restricted since it was issued in
compliance with the exemption form registration provided by Section 4
(2) of the Securities Act of 1933, as amended. After this stock has
been held for one (1) year, Mr. Kennaugh could sell a percentage of his
shares every three months based on 1% of the outstanding stock.
Therefore, this stock cannot be sold except in compliance with the
provisions of Rule 144.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
DIRECTORS AND EXECUTIVE OFFICERS
The following table identifies the Registrant's directors and executive
officers as of April 30, 1999. Directors are elected at the Registrant's annual
meeting of stockholders and hold office until their successors are elected and
qualified. The Registrant's officers are appointed annually by the Board of
Directors and serve at the pleasure of the Board.
Term as
Director
Name Position Held Expires
---- ------------- -------
Steven Bruce President and Director 2000
Michael J. Kennaugh Director 2000
Carol Krushnisky Secretary Treasurer -
STEVEN BRUCE, 41, graduated from Simon Fraser University in 1981 with a
Bachelor of Commerce degree in Economics. Since graduation he has been employed
with New Generation Power Corp. as Vice-President and Chief Operational Officer.
While employed with New Generation Power his duties included power contract
negotiation, project financing and administration over all aspects of the
accounting and financial functions. Subsequently Mr. Bruce became Vice-President
and Chief Financial officer of Newgen Environmental Systems Inc., a company
listed on the Alberta Stock Exchange ("Exchange") in Calgary, Alberta, Canada,
and specialized in all aspects of the development of the company and in
compliance reporting with the Exchange.
CAROL KRUSHNISKY, 59, graduated on the Dean's List from Quesnel
Secondary High School before working for two years in Quesnel, British Columbia
as a secretarial assistant to a group of lawyers. Subsequent to this position,
Ms. Krushnisky became assistant secretary to the Regional Engineer of British
Columbia before becoming private secretary to the Minister of Highway of British
Columbia, Phil Galaradi. She was employed in these two positions for a period of
five years starting in 1960. After ceasing work for several years due to a
family, Ms. Krushnisky incorporated and became president of Dixie Secretarial
Services Ltd., a company supplying office assistance to various businesses. In
conjunction with operating this company, Ms. Krushnisky accepted a position at
Swinton & Company where she was personal secretary to the senior partners.
During this time her main duties were reviewing of contracts, incorporating both
private and public companies and communications as requested with various
clients. For the past ten years she has managed her own
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<PAGE>
business being a distributor for Mary Kay cosmetics. During this time she has
served as a director of two public companies listed on the Vancouver Stock
Exchange; British Pacific Investments and Amca Industries Inc. She has assisted
in the formation of other companies both public and private.
MICHAEL J. KENNAUGH, 57, graduated from the University of British
Columbia with a degree in real estate appraisal. Subsequent to graduation he was
employed by various real estate companies before starting his own real estate
appraisal firm, Canwest Appraisals Inc. For several years he undertook
appraisals for major development companies in the real estate business. Since
that time he has been employed partly as a real estate developer and an
appraiser working independently.
None of the Directors or Executive Officers work full time for the
Registrant, but intend to devote such time as their responsibilities require.
None of the Registrant's Directors are currently directors of other companies
registered under the Securities and Exchange Act of 1934.
There are no family relationships between the directors, executive
officers or with any person under consideration for nomination as a director or
appointment as an executive officer of the Registrant.
ITEM 6. EXECUTIVE COMPENSATION
None of the Registrant's executive officers have received compensation
since the Registrant's inception.
The following table sets forth compensation paid or accrued by the
Registrant during the period ended April 30, 1999 to the Registrant's President
and shows compensation paid to any other officers or directors.
SUMMARY COMPENSATION TABLE (1999)
<TABLE>
<CAPTION>
LONG TERM COMPENSATION (US DOLLARS)
-----------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------- ------ -------
(A) (B) (C) (E) (F) (G) (H) (I)
OTHER RESTRICTED ALL OTHER
ANNUAL STOCK OPTIONS/ LTIP COMPEN-
NAME AND PRINCIPAL COMP. AWARDS SAR PAYOUTS SATION
POSITION YEAR SALARY ($) ($) (#) ($) ($)
-------- ---- ------ --- --- --- --- ---
<S> <C> <C> <C> <C> <C> <C> <C>
Steven Bruce, 1999 -0- -0- -0- -0- -0- -0-
President and
Director
Michael Kennaugh, 1999 -0- -0- -0- -0- -0- -0-
Director
Carol Krushnisky, 1999 -0- -0- -0- -0- -0- -0-
Secretary Treasurer
</TABLE>
There has been no compensation given to any of the Directors or Officers during
1999. There are no stock options outstanding as at April 30, 1999 and no options
have been granted in 1999, but it is contemplated that the Registrant may issue
stock options in the future to officers, directors, advisers and future
employees.
COMPENSATION OF DIRECTORS
Members of the Board of Directors do not receive cash compensation for
their services as Directors. Directors are not presently reimbursed for expenses
incurred in attending Board meetings.
20
<PAGE>
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Registrant has never before filed a prospectus specified under
Section 10(a) of the Securities Act of 1933 at this time. The Registrant raised
funds from its officers and directors relatives, friends and business associates
as more fully described below.
Shares issued to Directors
On March 16, 1999 the directors of the Registrant subscribed for
5,000,000 shares at $0.001 per share for cash consideration. The breakdown of
the shares is as follows:
Steven Bruce 2,500,000 shares
Michael J. Kennaugh 2,500,000 shares
This stock is restricted since it was issued in compliance with the
exemption from registration provided by Section 4(2) of the Securities Act of
1933, as amended. After this stock has been held for one year, the holders of
these shares of the Registrant could sell a percentage of their shares every
three months based on 1% of the outstanding stock in the Registrant. Therefore,
this stock can be sold after the expiration of one year in compliance with the
provisions of Rule 144. There are "stop transfer" instructions placed against
this stock and a legend is imprinted on each stock certificate.
Shares issued at $0.001 to non-directors and officers
On March 20, 1999 the Registrant accepted subscription agreements from
12 individual corporations for a total number of 6,000,000 shares at a price of
$0.001 per share. All shares were paid for in cash. These shares were issued in
accordance with the exemption from registration provided by Rule 504 of
Regulation D of the Securities Act of 1933, as amended and an appropriate Form D
was filed in connection with the issuance of these shares. The names of the
corporation, the principal officer and the number of shares purchased for each
corporation is listed below:
Name of Corporation Principal Number of Shares
------------------- --------- ----------------
Portsail Overseas Ltd. Maria Scott 550,000
Aquitaine Investments S.A. Ronald Lui 390,000
Longford Ventures Ltd. Jessica Garbutt 500,000
Principal Corp. Amir Sosa 545,000
Girot Compagnie S.A. Richard Smith 450,000
Kingmoor Capital Ltd. Tracey Williams 525,000
Waterloo Investments Inc. Clifford Wilkins 455,000
Ravensburg Kapital GmbH Marie Gabb 540,000
Camaret Freres S.A. Joy Vernon-Godfrey 530,000
First Lincoln Holdings Inc. Keith King 500,000
Blue Dolphin Capital Inc. David Finzer 480,000
Maurice International Inc. Michael Laidlaw 535,000
Shares issued at $0.10 per share to other shareholders
On or about March 26, 1999, the Registrant issued the following shares
to individuals listed for the consideration of $0.10 per share. All shares were
paid for in cash. These shares were issued in accordance with the exemption from
registration provided by Rule 504 of Regulation D of the
21
<PAGE>
Securities Act of 1933, as amended and an appropriate Form D was filed in
connection with the issuance of these shares.
Number of
Shareholder Shares
----------- ------
Nikolas Krushnisky 500
Jako Krushnisky 1,000
Gordon Krushnisky 1,000
Carrie Lee Page 500
Colleen Watalla 750
David Bruce 1,000
James D. Bruce 1,500
Sandra Bruce 1,000
Robin Hethey 1,250
Carsten Mide 500
Glyn Hethey 1,000
John W. Walker 1,000
Carol Finley 1,000
Charles Hethey 1,800
James Hethey 1,800
Rebekah Krushnisky 750
Carrie Thachuk 750
E. Del Thachuk 1,000
Stacey Bligh 1,000
Mary Hethey 2,000
Ray Levesque 500
Maryanne Thachuk 1,200
Philip Yee 900
Raymond Miller 500
Michael Thachuk 800
Certain parties interested in the Registrant's success have contributed
and continue to contribute time, office space, telephone, and other expenses,
without compensation or reimbursement. The Registrant has given recognition to
this contribution by including in expenses and crediting capital surplus the
following amounts:
Management fees $ 1,000
Rent 600
Telephone 200
--------
$ 1,800
The directors of the Registrant are directors, officers, stockholders
and employees of other companies. Therefore, conflicts of interest may arise
between their duties as directors of the Registrant and as directors and
officers of other companies. The Registrant has formulated no policy for the
resolution of such conflict.
REPORTS TO SECURITIES HOLDERS
Prior to filing this Form 10-SB, the Registrant has not been required
to deliver annual reports. To the extent that the Registrant is required to
deliver annual reports to security holders through its status of a reporting
company, the Registrant shall deliver annual reports. Also, to the extent the
Registrant is required to deliver annual reports by the rules or regulations of
any exchange upon which the Registrant's shares are traded, the Registrant shall
deliver annual
22
<PAGE>
reports. If the Registrant is not required to deliver annual reports, the
Registrant will not go to the expense of producing and delivering such reports.
If the Registrant is required to deliver annual reports, they will contain
audited financial statements as required.
Prior to the filing of this Form 10-SB, the Registrant has not filed
reports with the Securities and Exchange Commission. Once the Registrant becomes
a reporting company, management anticipates that Forms 3, 4, 5, 10K-SB, 10Q-SB,
8-K and Schedules 13D along with the appropriate proxy material will have to be
filed as they come due. If the Registrant issues additional shares, the
Registrant may file additional registration statements for those shares.
The public may read and copy any material which the Registrant files
with the Securities and Exchange Commission at the Commission's Public Reference
Room at 450 Fifth Street, N.W., Washington, D.C. 20549. The public may obtain
information on the operation of the Public Reference Room by calling the
Commission at 1-800-SEC-0330. The Commission maintains an Internet site that
contains reports, proxy and information statements, and other information
regarding the issuers that file electronically with the Commission. The Internet
address of the Commission's site is (http://www.sec.gov).
YEAR 2000 COMPUTER PROBLEMS
The Registrant is engaged in and dependent on computer technology in
its business operations. Many existing computer programs use only two digits to
identify a year in the date field; i.e., "98" instead of "1998". These programs
were designed and developed without considering the impact of the upcoming
change in the century, i.e., Year 2000. The Registrant uses computer software
programs and systems that are essential to its business operations. If not
corrected, many computer applications could fail or create erroneous results by
or at the Year 2000. The Registrant has:
8 diagnosed and repaired the existing and known Year 2000 problems in its
computer software and systems;
9 reviewed the possible contingent liabilities the Registrant may have to
third parties as a result of non-compliant systems; and
10 examined the extent the Registrant depends on third parties whose
systems may not be Year 2000 compliant.
However, there may be untold numbers of unforeseen circumstances or
unknown factors which the Registrant has not yet identified, determined or
anticipated regarding the Year 2000 computer problems, and such problems could
have a material adverse affect on the Registrant's business operations and
financial condition. Consequently, the Registrant can give no assurance that the
Year 2000 compliance can be fully achieved without costs and uncertainties that
may seriously and substantially adversely affect the Registrant's operations and
financial results.
In summary, the problem is a massive, pervasive, complex, world-wide
phenomena that could, in a worst-case scenario, totally shut down and destroy
the Registrant's business operations.
ITEM 8. DESCRIPTION OF SECURITIES
The Registrant's articles of incorporation currently provide that the
Registrant is authorized to issue 200,000,000 shares of common stock, par value
$0.001 per share. As at April 30, 1999, 11,025,000 shares were outstanding.
23
<PAGE>
COMMON STOCK
Each holder of record of the Registrant's common stock is entitled to
one vote per share in the election of the Registrant's directors and all other
matters submitted to the Registrant's stockholders for a vote. Holders of the
Registrant's common stock are also entitled to share ratably in all dividends
when, as, and if declared by the Registrant's Board of Directors from funds
legally available therefore, and to share ratably in all assets available for
distribution to the Registrant's stockholders upon liquidation or dissolution,
subject in both cases to any preference that may be applicable to any
outstanding preferred stock. There are no preemptive rights to subscribe to any
of the Registrant's securities, and no conversion rights or sinking fund
provisions applicable to the common stock.
Neither the Registrant's articles of incorporation nor its bylaws
provide for cumulative voting. Accordingly, persons who own or control a
majority of the shares outstanding may elect all of the Board of Directors, and
persons owning less than a majority could be foreclosed from electing any.
OPTIONS OUTSTANDING
There are no outstanding options. It is the intention of the Board of
Directors to grant stock options to directors, officers and future employees at
some time in the future. At the present time no consideration has been given to
the granting of stock options.
24
<PAGE>
PART 11
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S
COMMON EQUITY AND OTHER STOCKHOLDER MATTERS
MARKET INFORMATION
The Registrant's stock is not presently traded or listed on any public
market. Upon effectiveness of the Registrant's registration statement under the
Securities Exchange Act of 1934, it is anticipated one or more broker dealers
may make a market in its securities over the counter, with quotations carried on
the National Association of Securities Dealers, Inc.'s "OTC Bulletin Board".
There is no established market price for the shares. There are no
common shares subject to outstanding options or warrants or securities
convertible into common equity of the Registrant. The number of shares subject
to Rule 144 is 5,000,000. Each share certificate has the appropriate legend
affixed thereto. There are no shares being offered to the public and no shares
have been offered pursuant to an employee benefit plan or dividend reinvestment
plan.
HOLDERS
The approximate number of record holders of the Registrant's common
stock as at April 30, 1999 is 39 of which two are directors of the Registrant.
DIVIDENDS
The Registrant has never paid cash dividends on its common stock and
does not intend to do so in the foreseeable future. The Registrant currently
intends to retain any earnings for the operation and expansion of its business.
TRANSFER AGENT
The Registrant's transfer agent is Nevada Agency & Trust Co., 50 West
Liberty Street, Suite 880, Reno, Nevada, 89501.
ITEM 2. LEGAL PROCEEDINGS
There are no legal proceedings to which the Registrant is a party or to
which its property is subject, nor to the best of management's knowledge are any
material legal proceedings contemplated.
ITEM 3. DISAGREEMENT WITH ACCOUNTANTS AND
FINANCIAL DISCLOSURE
From inception to date, the Registrant's principal accountant is
Andersen Andersen & Strong, L.C. of Salt Lake City, Utah. The firm's report for
the period from inception to April 30, 1999 did not contain any adverse opinion
or disclaimer, nor were there any disagreements between management and the
Registrant's accountants.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES
From inception through to April 30, 1999, the Registrant has issued and
sold the following unregistered shares of its common stock (the aggregated value
of all such offerings did not exceed US$1,000,000):
25
<PAGE>
(i) Subscription for 5,000,000 shares by the Directors of the Registrant
On March 16,1999 the Registrant approved the issuance to its directors
of 5,000,000 shares at a price per share of $0.001. Mr. Bruce, President of the
Registrant, purchased for cash 2,500,000 shares and Mr. Kennaugh, Director of
the Registrant, purchased for cash 2,500,000 shares. This stock is restricted
since it was issued in compliance with the exemption from registration provided
by Section 4(2) of the Securities Act of 1933, as amended. After this stock has
been held for one year, the Directors could sell within a three month period a
percentage of their shares based on 1% of the outstanding stock in the
Registrant. Therefore, this stock can be sold after the expiration of one year
in compliance with the provisions of Rule 144. There are "stop transfer"
instructions placed against this certificate and a legend has been imprinted on
the stock certificate itself.
(ii) Subscription for 6,000,000 shares at a price of $0.001 per share
On March 21, 1999, the Registrant accepted share subscriptions from
twelve corporate investors of a total of 6,000,000 shares at a price of $0.001
per share. All shares were paid for in cash which result in proceeds to the
Registrant of $6,000. These shares were issued in accordance with the exemption
from registration provided by Rule 504 of Regulation D of the Securities Act of
1933, as amended, and an appropriate Form D was filed in connection with the
issuance of these shares. All of these corporation reside outside the United
States and none of the principals are residents or citizens of the United
States.
(iii) Subscriptions for 25,000 shares at a price of $0.10 per share
On March 27, 1999, the Registrant accepted subscriptions from
twenty-five investors in the amount of 25,000 shares at a price of $0.10per
share. In all cases the consideration was cash. These shares were issued in
accordance with the exemption from registration provided by Rule 504 of
Regulation D of the Securities Act of 1933, as amended, and an appropriate Form
D was filed in connection with the issuance of these shares. All the
shareholders live outside the United States and none are US citizens.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 78.751 of the Nevada General Corporation Law allows the
Registrant to indemnify any person who was or is threatened to be made a party
to any threatened, pending, or completed action, suit, or proceeding, by reason
of the fact that he or she is or was a director, officer, employee or agent of
the Registrant, or is or was serving at the request of the Registrant as a
director, officer, employee, or agent of any corporation, partnership, joint
venture, trust, or other enterprise. The Registrant's bylaws provide that such
person shall be indemnified and held harmless to the fullest extent permitted by
Nevada law.
Nevada law permits the Registrant to advance expenses in connection
with defending any such proceedings, provided that the indemnitee undertakes to
repay any such advances if it is later determined that such person was not
entitled to be indemnified by the Registrant. The Registrant's bylaws require
that the Registrant advance such funds upon receipt of such an undertaking with
respect to repayment.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Registrant pursuant to the foregoing provisions or otherwise, the Registrant has
been advised that, in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in such act, and is
therefore unenforceable.
26
<PAGE>
PART F/S
FINANCIAL STATEMENTS
The following financial statements are filed with this Form 10-SB:
PAGE
----
Report of Independent Certified Public Accountants 28
Financial Statements of Zeb Oro Explorations Inc.
Balance Sheet as at April 30, 1999 29
Statement of Operations for the Period from March 4, 1999 (Date of
Inception) to April 30, 1999 30
Statement of Changes in Stockholders' Equity for the Period from March
4, 1999 (Date of Inception) to April 30, 1999 31
Statement of Cash Flows for the Period from March 4, 1999 (Date of
Inception) to April 30, 1999 32
Notes to Financial Statements 33
27
<PAGE>
<TABLE>
<S> <C>
ANDERSEN ANDERSEN & STRONG, L.C. 941 EAST 3300 SOUTH, SUITE 220
CERTIFIED PUBLIC ACCOUNTANTS AND BUSINESS CONSULTANTS BOARD SALT LAKE CITY, UTAH, 84106
MEMBER SEC PRACTICE SECTION OF THE AICPA TELEPHONE 801-486-0096
FAX 801-486-0098
E-MAIL KANDERSEN @ MSN.COM
</TABLE>
Board of Directors
Zeb Oro Explorations Inc.
Vancouver B. C. Canada
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have audited the accompanying balance sheet of Zeb Oro Explorations Inc. (a
development stage company) at April 30, 1999 and the statement of operations,
stockholders' equity, and cash flows for the period from March 4, 1999 (date of
inception) to April 30, 1999. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Zeb Oro Explorations Inc. at
April 30, 1999 and the results of operations, and cash flows for the period from
March 4, 1999 (date of inception) to April 30, 1999 in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company is in the development
stage and will need additional working capital for its planned activity, which
raises substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are described in Note 5. These
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
Salt Lake City, Utah /s/ "Andersen Andersen & Strong"
May 28, 1999
A member of ACF International with affiliated offices worldwide
28
<PAGE>
ZEB ORO EXPLORATIONS INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE
APRIL 30, 1999
- --------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS
Cash $ 9,811
---------
Total Current Assets 9,811
---------
OTHER ASSETS
Mineral claims - Note 3 -
$ 9,811
=========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 3,345
---------
Total Current Liabilities 3,345
---------
STOCKHOLDERS' EQUITY
Common stock
200,000,000 shares authorized, at $0.001 par
value; 11,025,000 shares issued and outstanding 11,025
Capital in excess of par value 4,275
Deficit accumulated during the development stage (8,824)
---------
Total Stockholders' Equity 6,466
---------
$ 9,811
The accompanying notes are an integral part of these financial statements.
29
<PAGE>
ZEB ORO EXPLORATIONS INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FOR THE PERIOD FROM MARCH 4, 1999
(DATE OF INCEPTION) TO APRIL 30, 1999
- --------------------------------------------------------------------------------
SALES $ -
EXPENSES 8,834
--------
NET LOSS $ (8,834)
NET LOSS PER COMMON SHARE
Basic $ (.001)
========
AVERAGE OUTSTANDING SHARES
Basic 11,025,000
==========
The accompanying notes are an integral part of these financial statements.
30
<PAGE>
ZEB ORO EXPLORATIONS INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM MARCH 4, 1999 (DATE OF INCEPTION)
TO APRIL 30, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Common Stock Capital in
------------ Excess of Accumulated
Shares Amount Par Value Deficit
------ ------ --------- -------
<S> <C> <C> <C> <C>
Balance March 4, 1999 (date of inception) - $ - $ - $ -
Issuance of common stock for cash
at $.001 - March 14, 1999 5,000,000 5,000 - -
Issuance of common stock for cash
at $0.001 - March 16, 1999 6,000,000 6,000 - -
Issuance of common stock for cash
At $0.10 - March 27, 1999 25,000 25 2,475 -
Capital contribution - expenses - - 1,800 -
Net operating loss for the period from
March 4, 1999 to April 30, 1999 - - - (8,834)
---------- -------- --------- --------
Balance April 30, 1999 11,025,000 $ 11,025 $ 4,275 $ (8,824)
========== ======== ========== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
31
<PAGE>
ZEB ORO EXPLORATIONS INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM MARCH 4, 1999
(DATE OF INCEPTION) TO APRIL 30, 1999
- --------------------------------------------------------------------------------
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net loss $(8,834)
Adjustments to reconcile net loss to
net cash provided by operating
activities:
Change in accounts payable 3,345
Capital contributions - expenses 1,800
-------
Net Cash From Operations (3,689)
CASH FLOWS FROM INVESTING
ACTIVITIES: -
-------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from issuance of common stock 13,500
-------
Net Increase in Cash 9,811
Cash at Beginning of Period -
-------
Cash at End of Period $ 9,811
=======
SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES
Capital contributions - expenses $ 1,800
=======
The accompanying notes are an integral part of these financial statements.
32
<PAGE>
ZEB ORO EXPLORATIONS INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCLAL STATEMENTS
- --------------------------------------------------------------------------------
1. ORGANIZATION
The Company was incorporated under the laws of the State of Nevada on March 4,
1999 with authorized common stock of 200,000,000 shares at $0.001.
The Company was organized for the purpose of developing mineral properties
however operations had not been started by the report date.
The Company is in the development stage.
Since its inception the Company has completed a Regulation D offerings of
11,025,000 shares of its capital stock for cash.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICILES
Accounting Methods
- ------------------
The Company recognizes income and expenses based on the accrual method of
accounting.
Dividend Policy
- ---------------
The Company has not yet adopted a policy regarding payment of dividends.
Income Taxes
- ------------
The Company has elected a fiscal year ending December 31, and has not completed
an operating period and therefore has not filed an income tax return.
Earning (Loss) Per Share
- ------------------------
Earnings (loss) per share amounts are computed based on the weighted average
number of shares actually outstanding.
Cash and Cash Equivalents
- -------------------------
The Company considers all highly liquid instruments purchased with a maturity,
at the time of purchase, of less than three months, to be cash equivalents.
33
<PAGE>
ZEB ORO EXPLORATIONS INC..
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
Foreign Currency Translation
- ----------------------------
The transactions of the Company completed in Canadian dollars have been
translated to US dollars. Assets and liabilities are translated at the year end
exchange rates and the income and expenses at the average rates of exchange
prevailing during the period reported on.
Amortization of Capitalized Mineral Lease Costs
- -----------------------------------------------
The Company will use the successful efforts method to amortize the capitalized
costs of any mineral leases it acquires, which provides for capitalizing the
purchase price of the project and the additional costs directly related to
proving the properties, and amortizing these amounts over the life of the
mineral deposit. All other costs will be expensed as incurred. Unamortized
capitalized costs will be expensed if the property is proven to be of no value.
Environmental Requirements
- --------------------------
At the report date environmental requirements related to the mineral claims
acquired (note 3) are unknown and therefore an estimate of any future cost
cannot be made.
Financial Instruments
- ---------------------
The carrying amounts of financial instruments, including cash, mineral leases,
and accounts payable, are considered by management to be their estimated fair
values. These values are not necessarily indicative of the amounts that the
Company could realize in a current market exchange.
Estimates and Assumptions
- -------------------------
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of the assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were assumed in
preparing these financial statements.
3. MINERAL CLAIMS
The Company has acquired one 15 unit metric mineral claim known as the Zeb Oro
Claim claims located in the Zeballos mining area near the town of Zeballos about
300 kilometres north west of Victoria, British Columbia with an expiration date
of February 25, 2000. The cost of staking and filing have been expensed.
34
<PAGE>
ZEB ORO EXPLORATIONS INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCLAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
4. RELATED PARTY TRANSACTIONS
Related parties have acquired 45% of the common stock issued .
The officers and directors of the Company are involved in other business
activities and they may, in the future, become involved in additional business
ventures which also may require their attention. If a specific business
opportunity becomes available, such persons may face a conflict in selecting
between the Company and their other business interests. The Company has
formulated no policy for the resolution of such conflicts.
5. GOING CONCERN
The Company will need additional working capital to be successful in its efforts
to develop the mineral claims acquired and therefore continuation of the Company
as a going concern is dependent upon obtaining additional working capital and
the management of the Company has developed a strategy, which it believes will
accomplish this objective through additional equity funding, and long term
financing, which will enable the Company to operate in the future.
Management recognizes that, if it is unable to raise additional capital, the
Company cannot be successful in its efforts.
35
<PAGE>
PART 111
ITEM 1. INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO.
---
<S> <C>
(2) Charter and By-Laws
(a) Certificate of Incorporation of Zeb Oro Explorations Inc. (filed
herewith, page 38)
(b) Bylaws (filed herewith, page 42)
(3) Instruments Defining Rights of Securities Holders
(a) Text of stock certificates for common stock (filed herewith, page 54)
(5) Voting Trust Agreements
None
(6) Material Contracts
(a) Not made in the ordinary course of business
(i) Transfer Agent and Registrar Agreement between
Registrant and Nevada Agency & Trust Co., dated March
10, 1999 (filed herewith, page 54)
(10) Consent of experts and counsel
(i) Consent of Andersen Andersen & Strong, L.C., independent
certified public accountants (filed herewith, page 58)
(11) Statement re computation of per share earnings
Not applicable
(16) Letter of change in certifying accountant
Not applicable
(21) Subsidiaries of the Registrant
Not applicable
(24) Power of Attorney
None
(99) Addition Exhibits
None
ITEM 2. DESCRIPTIONS OF EXHIBITS
[Attached, pages 39 through 58]
</TABLE>
36
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant has caused this registration statement to be signed on its behalf
by the undersigned, thereunto duly authorized.
ZEB ORO EXPLORATIONS INC.
(Registrant)
by /s/ "STEVEN BRUCE"
-----------------------------------
Steven Bruce
President and Director
By /s/ "CAROL KRUSHNIKSY"
-----------------------------------
Carol Krushnisky
Secretary Treasurer
Dated: June 3, 1999
37
EXHIBIT NO. 2 (A)
ARTICLES OF INCORORATION
OF
ZEB ORO EXPLORATIONS INC.
* * * * *
The undersigned, acting as incorporator, pursuant to the provisions
of the laws of the State of Nevada relating to private corporations, hereby
adopts the following Articles of Incorporation:
ARTICLE ONE. [NAME]. The name of the corporation is:
ZEB ORO EXPLORATIONS INC.
ARTICLE TWO. [RESIDENT AGENT]. The initial agent for service of
process is Nevada Agency and Trust Company, 50 West Liberty Street, Suite 880,
City of Reno, County of Washoe, State of Nevada 89501.
ARTICLE THREE. [PURPOSES]. The purposes for which the corporation is
organized are to engage in any activity or business not in conflict with the
laws of the State of Nevada or of the United States of America, and without
limiting the generality of the foregoing, specifically:
1. [OMNIBUS] . To have to exercise all the powers now or hereafter
conferred by the laws of the State of Nevada upon corporations
organized pursuant to the laws under which the corporation is organized
and any and all acts amendatory thereof and supplemental thereto.
11. [CARRYING ON BUSINESS OUTSIDE STATE). To conduct and carry on its
business or any branch thereof in any state or territory of the United
States or in any foreign country in conformity with the laws of such
state, territory, or foreign country, and to have and maintain in any
state, territory, or foreign country a business office, plant, store or
other facility.
111. [PURPOSES TO BE CONSTRUED AS POWERS] . The purposes specified
herein shall be construed both as purposes and powers and shall be in
no wise limited or restricted by reference to, or inference from, the
terms of any other clause in this or any other article, but the
purposes and powers specified in each of the clauses herein shall be
regarded as independent purposes and powers, and the enumeration of
specific purposes and powers shall not be construed to limit or
restrict in any manner
38
<PAGE>
the meaning of general terms or of the general powers of the
corporation; nor shall the expression of one thing be deemed to exclude
another, although it be of like nature not expressed.
ARTICLE FOUR. [CAPITAL STOCK]. The corporation shall have authority
to issue an aggregate of TWO HUNDRED MILLION (200,000,000) Common Capital
Shares, PAR VALUE ONE MILL ($0.001) per share for a total capitalization of TWO
HUNDRED THOUSAND DOLLARS ($200,000.00).
The holders of shares of capital stock of the corporation shall not
be entitled to pre-emptive or preferential rights to subscribe to any unissued
stock or any other securities which the corporation may now or hereafter be
authorized to issue.
The corporation's capital stock may be issued and sold from time to
time for such consideration as may be fixed by the Board of Directors, provided
that the consideration so fixed is not less than par value.
The stockholders shall not possess cumulative voting rights at all
shareholders meetings called for the purpose of electing a Board of Directors.
ARTICLE FIVE. [DIRECTORS]. The affairs of the corporation shall be
governed by a Board of Directors of no more than eight (8) nor less than one (1)
person. The names and addresses of the first Board of Director are:
NAME ADDRESS
---- -------
Michael J. Kennaugh 42 - 2951 Panorama Drive
Coquitlam, British Columbia
Canada, V3E 2W3
ARTICLE SIX. [ASSESSMENT OF STOCK]. The capital stock of the
corporation, after the amount of the subscription price or par value has been
paid in, shall not be subject to pay debts of the corporation, and no paid up
stock and no stock issued as fully paid up shall ever be assessable or assessed.
ARTICLE SEVEN. [INCORPORATOR]. The name and address of the
incorporator of the corporation is as follows:
NAME ADDRESS
---- -------
Amanda Cardinalli 50 West Liberty Street, Suite 880
Reno, Nevada 89501
ARTICLE EIGHT. [PERIOD OF EXISTENCE]. The period of existence of the
corporation shall be perpetual.
39
<PAGE>
ARTICLE NINE. [BY-LAWS]. The initial By-laws of the corporation
shall be adopted by its Board of Directors. The power to alter, amend, or repeal
the By-laws, or to adopt new By-laws, shall be vested in the Board of Directors,
except as otherwise may be specifically provided in the By-laws.
ARTICLE TEN. [STOCKHOLDERS' MEETINGS]. Meeting of stockholders shall
be held at such place within or without the State of Nevada as may be provided
by the By-laws of the corporation. Special meetings of the stockholders may be
called by the President or any other executive officer of the corporation, the
Board of Directors, or any member thereof, or by the recordholder or holders of
at least ten percent (10%) of all shares entitled to vote at the meeting. Any
action otherwise required to be taken at a meeting of the stockholders, except
election of directors, may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by stockholdershaving at
least a majority of the voting power.
ARTICLE ELEVEN . [CONTRACTS OF CORPORATION]. No contract or other
transaction between the corporation and any other corporation, whether or not a
majority of the shares of the capital stock of such other corporation is owned
by this corporation, and no act of this corporation shall in any way be affected
or invalidated by the fact that any of the directors of this corporation are
pecuniarily or otherwise interested in, or are directors or officers of such
other corporation. Any director of this corporation, individually, or any firm
of which such director may be a member, may be a party to, or may be pecuniarily
or otherwise interested in any contract or transaction of the corporation;
provided, however, that the fact that he or such firm is so interested shall be
disclosed or shall have been known to the Board of Directors of this
corporation, or a majority thereof; and any director of this corporation who is
also a director or officer of such other corporation, or who is so interested,
may be counted in determining the existence of a quorum at any meeting of the
Board of Directors of this corporation that shall authorize such contract or
transaction, and may vote thereat to authorize such contract or transaction,
with like force and effect as if he were not such director or officer of such
other corporation or not so interested.
ARTICLE.TWELVE. [LIABILITY OF DIRECTORS AND OFFICERS]. No director
or officer shall have any personal liability to the corporation or its
stockholders for damages for breach of fiduciary duty as a director or officer,
except that this Article Twelve shall not eliminate or limit the liability of a
director or officer for (i) acts or omissions which involve intentional
misconduct, fraud or a knowing violation of law, or (ii) the payment of
dividends in violation of the Nevada Revised Statutes.
IN WITNESS WHEREOF, the undersigned incorporator has hereunto
affixed her signature at Reno, Nevada this 3rd day of March, 1999.
by /s/ "Amanda Cardinalli"
-------------------------------
AMANDA CARDINALLI
STATE OF NEVADA }
40
<PAGE>
: ss.
COUNTY OF WASHOE }
On the 3rd day of March, 1999, before me, the undersigned, a
Notary Public in and for the State of Nevada, personally appeared AMANDA
CARDINALLI, known to me to be the person described in and who executed the
foregoing instrument, and who acknowledged to me that she executed the same
freely and voluntarily for the uses and purposes therein mentioned.
IN WITNESS WHEREOF, I have hereunto set my hand and
affixed my official seal the day and year first above written.
by /s/ "Margaret Oliver"
-----------------------------------
NOTARY PUBLIC
Residing in Reno, Nevada
My Commission Expires:
October 10, 2000
41
EXHIBIT NO. 2 (B)
BY LAWS
OF
ZEB ORO EXPLORATIONS INC.
A NEVADA CORPORATION
ARTICLE I
---------
OFFICES
SECTION 1. The registered office of this corporation shall be in the City
of Reno, State of Nevada.
SECTION 2. The Corporation may also have offices at such other places
both within and without the State of Nevada as the Board of Directors may from
time to time determine or the business of the corporation may require.
ARTICLE 2
---------
MEETINGS OF STOCKHOLDERS
SECTION 1. All annual meetings of the stockholders shall be held at the
registered office of the corporation or at such other place within or without
the State of Nevada as the Directors shall determine. Special meetings of the
stockholders may be held at such time and place within or without the State of
Nevada as shall be stated in the notice of the meeting, or in a duly executed
waiver of notice thereof.
SECTION 2. Annual meetings of the stockholders shall be held on the
anniversary date of incorporation each year if not a legal holiday and, and if a
legal holiday, then on the next secular day following, or at such other time as
may be set by the Board of Directors from time to time, at which the
stockholders shall elect by vote a Board of Directors and transact such other
business as may properly be brought before the meeting.
SECTION 3. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the Articles of
Incorporation, may be called by the President or the Secretary, by resolution of
the Board of Directors or at the request in writing of stockholders owning a
majority in amount of the entire capital stock of the corporation issued and
outstanding and entitled to vote. Such request shall state the purpose of the
proposed meeting.
SECTION 4. Notices of meetings shall be in writing and signed by the
President or Vice-President or the Secretary or an Assistant Secretary or by
such other person or persons as the Directors shall designate. Such notice shall
state the purpose or purposes for which the meeting is called and the time and
the place, which may be within or without this State,
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where it is to be held. A copy of such notice shall be either delivered
personally to or shall be mailed, postage prepaid, to each stockholder of record
entitled to vote at such meeting not less than ten nor more than sixty days
before such meeting. If mailed, it shall be directed to a stockholder at his
address as it appears upon the records of the corporation and upon such mailing
of any such notice, the service thereof shall be complete and the time of the
notice shall begin to run from the date upon which such notice is deposited in
the mail for transmission to such stockholder. Personal delivery of any such
notice to an officer of the corporation or association, or to any member of a
partnership shall constitute delivery of such notice to such corporation,
association or partnership. In the event of the transfer of stock after delivery
of such notice of and prior to the holding of the meeting, it shall not be
necessary to deliver or mail such notice of the meeting to the transferee.
SECTION 5. Business transactions at any special meeting of stockholders
shall be limited to the purpose stated in the notice.
SECTION 6. The holders of a majority of the stock issued and outstanding
and entitled to vote thereat, present in person or represented by proxy, shall
constitute a quorum at all meetings of the stockholders for the transaction of
business except as otherwise provided by statute or by the Articles of
Incorporation. If, however, such quorum shall not be present or represented at
any meeting of the stockholders, the stockholders entitled to vote thereat,
present in person or represented by proxy, shall have power to adjourn the
meeting from time to time, without notice other than announcements at the
meeting, until a quorum shall be presented or represented. At such adjourned
meetings at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified.
SECTION 7. When a quorum is present or represented at any meeting, the
vote of the holders of 10% of the stock having voting power present in person or
represented by proxy shall be sufficient to elect Directors or to decide any
question brought before such meeting, unless the question is one upon which by
express provision of the statute or of the Articles of Incorporation, a
different vote shall govern and control the decision of such question.
SECTION 8. Each stockholder of record of the corporation shall be entitled
at each meeting of the stockholders to one vote for each share standing in his
name on the books of the corporation. Upon the demand of any stockholder, the
vote for Directors and the vote upon any question before the meeting shall be by
ballot.
SECTION 9. At any meeting of the stockholders any stockholder may be
represented and vote by a proxy or proxies appointed by an instrument in
writing. In the event that any such instrument in writing shall designate two or
more persons to act as proxies, a majority of such persons present at the
meeting, or, if only one shall be present, then that one shall have and may
exercise all the powers conferred by such written instruction upon all of the
persons so designated unless the instrument shall otherwise provide. No proxy or
power of attorney to vote shall be voted at a meeting of the stockholders unless
it shall have been filed with the Secretary of the meeting when required by the
inspectors of election. All questions regarding the qualifications of voters,
the validity of proxies and the acceptance of or rejection of votes shall be
decided by the inspectors of election who shall be appointed by the Board of
Directors, or if not so appointed, then by the presiding officer at the meeting.
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SECTION 10. Any action which may be taken by the vote of the stockholders
at a meeting may be taken without a meeting if authorized by the written consent
of stockholders holding at least a majority of the voting power, unless the
provisions of the statute or the Articles of Incorporation require a greater
proportion of voting power to authorize such action in which case such greater
proportion of written consents shall be required.
ARTICLE 3
---------
DIRECTORS
SECTION 1. The business of the corporation shall be managed by its Board
of Directors which may exercise all such powers of the corporation and do all
such lawful acts and things as are not by statute or by the Articles of
Incorporation or by these Bylaws directed or required to be exercised or done by
the stockholders.
SECTION 2. The number of Directors which shall constitute the whole board
shall be riot less than one and not more than eight. The number of Directors may
from time to time be increased or decreased to not less than one nor more than
eight by action of the Board of Directors. The Directors shall be elected at the
annual meeting of the stockholders and except as provided in section 2 of this
Article, each Director elected shall hold office until his successor is elected
and qualified. Directors need not be stockholders.
SECTION 3. Vacancies in the Board of Directors including those caused by
an increase in the number of Directors, may be filed by a majority of the
remaining Directors, though less than a quorum, or by a sole remaining Director,
and each Director so elected shall hold office until his successor is elected at
the annual or a special meeting of the stockholders. The holders of a two-thirds
of the outstanding shares of stock entitled to vote may at any time peremptorily
terminate the term of office of all or any of the Directors by vote at a meeting
called for such purpose or by a written statement filed with the Secretary or,
in his absence, with any other officer. Such removal shall be effective
immediately, even if successors are not elected simultaneously and the vacancies
on the Board of Directors resulting therefrom shall only be filled from the
stockholders.
A vacancy or vacancies on the Board of Directors shall be
deemed to exist in case of death, resignation or removal of any Director, or if
the authorized number of Directors be increased, or if the stockholders fail at
any annual or special meeting of stockholders at which any Director or Directors
are elected to elect the full authorized number of Directors to be voted for at
that meeting.
The stockholders may elect a Director or Directors at any time
to fill any vacancy or vacancies not filled by the Directors. If the Board of
Directors accepts the resignation of a Director tendered to take effect at a
future time, the Board or the stockholders shall have power to elect a successor
to take office when the resignation is to become effective
No reduction of the authorized number of Directors shall have
the effect of removing any Director prior to the expiration of his term of
office.
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ARTICLE 4
---------
MEETING OF THE BOARD OF DIRECTORS
SECTION 1. Regular meetings of the Board of Directors shall be held at any
place within or without the State which has been designated from time to time by
resolution of the Board or by written consent of all members of the Board. In
the absence of such designation regular meetings shall be held at the registered
office of the corporation. Special meetings of the Board may be held either at a
place so designated or at the registered office.
SECTION 2. The first meeting of each newly elected Board of Directors
shall be held immediately following the adjournment of the meeting of
stockholders and at the place thereof. No notice of such meeting shall be
necessary to the Directors in order legally to constitute the meeting, provided
a quorum be present. In the event such meeting is not so held, the meeting may
be held at such time and place as shall be specified in a notice given as
hereinafter provided for special meetings of the Board of Directors.
SECTION 3. Regular meetings of the Board of Directors may be held without
call or notice at such time and at such place as shall from time to time be
fixed and determined by the Board of Directors.
SECTION 4. Special meetings of the Board of Directors may be called by the
Chairman or the President or by the Vice-President or by any two Directors.
Written notice of the time and place of special meetings shall be delivered
personally to each Director, or sent to each Director by mail or by other form
of written communication, charges prepaid, addressed to him at his address as it
is shown upon the records or if not readily ascertainable, at the place in which
the meetings of the Directors are regularly held. In case such notice is mailed
or telegraphed, it shall be deposited in the postal service or delivered to the
telegraph company at least forty-eight (48) hours prior to the time of the
holding of the meeting. In case such notice is delivered or taxed, it shall be
so delivered or taxed at least twenty-four (24) hours prior to the time of the
holding of the meeting. Such mailing, telegraphing, delivery or taxing as above
provided shall be due, legal and personal notice of such Director.
SECTION 5. Notice of the time and place of holding an adjourned meeting
need not be given to the absent Directors if the time and place be fixed at the
meeting adjourned.
SECTION 6. The transaction of any meeting of the Board of Directors,
however called and noticed or wherever held, shall be as valid as though
transacted at a meeting duly held after regular call and notice, if a quorum be
present, and if, either before or after such meeting, each of the Directors not
present signs a written waiver of notice, or a consent of holding such meeting,
or approvals of the minutes thereof. All such waivers, consents or approvals
shall be filed with the corporate records or made a part of the minutes of the
meeting.
SECTION 7. The majority of the authorized number of Directors shall be
necessary to constitute a quorum for the transaction of business, except to
adjourn as hereinafter provided. Every act or decision done or made by a
majority of the Directors present at a meeting duly held at which a quorum is
present shall be regarded as the act of the Board of Directors,
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<PAGE>
unless a greater number be required by law or by the Articles of Incorporation.
Any action of a majority, although not at a regularly called meeting, and the
record thereof, if assented to in writing by all of the other members of the
Board shall be as valid and effective in all respects as if passed by the Board
in regular meeting.
SECTION 8. A quorum of the Directors may adjourn any Directors meeting to
meet again at stated day and hour; provided, however, that in the absence of a
quorum, a majority of the Directors present at any Directors meeting, either
regular or special, may adjourn from time to time until the time fixed for the
next regular meeting of the Board.
ARTICLE 5
---------
COMMITTEES OF DIRECTORS
SECTION 1. The Board of Directors may, by resolution adopted by a majority
of the whole Board, designate one or more committees of the Board of Directors,
each committee to consist of two or more of the Directors of the corporation
which, to the extent provided in the resolution, shall and may exercise the
power of the Board of Directors in the management of the business and affairs of
the corporation and may have power to authorize the seal of the corporation to
be affixed to all papers which may require it. Such committee or committees
shall have such name or names as may be determined from time to time by the
Board of Directors. The members of any such committee present at any meeting and
not disqualified from voting may, whether or not they constitute a quorum,
unanimously appoint another member of the Board of Directors to act at the
meeting in the place of any absent or disqualified member. At meetings of such
committees, a majority of the members or alternate members at any meeting at
which there is a quorum shall be the act of the committee.
SECTION 2. The committee shall keep regular minutes of their proceedings
and report the same to the Board of Directors.
SECTION 3. Any action required or permitted to be taken at any meeting of
the Board of Directors or of any committee thereof may be taken without a
meeting if a written consent thereto is signed by all members of the Board of
Directors or of such committee, as the case may be, and such written consent is
filed with the minutes of proceedings of the Board or committee.
ARTICLE 6
---------
COMPENSATION OF DIRECTORS
SECTION 1. The Directors may be paid their expenses of attendance at each
meeting of the Board of Directors and may be paid a fixed sum for attendance at
each meeting of the Board of Directors or a stated salary as Director. No such
payment shall preclude any Director from serving the corporation in any other
capacity and receiving compensation therefore. Members of special or standing
committees may be allowed like reimbursement and compensation for attending
committee meetings.
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ARTICLE 7
---------
NOTICES
SECTION 1. Notices to Directors and stockholders shall be in writing and
delivered personally or mailed to the Directors or stockholders at their
addresses appearing on the books of the corporation. Notices to Directors may
also be given by fax and by telegram. Notice by mail, fax or telegram shall be
deemed to be given at the time when the same shall be mailed.
SECTION 2. Whenever all parties entitled to vote at any meeting, whether
of Directors or stockholders, consent, either by a writing on the records of the
meeting or filed with the Secretary, or by presence at such meeting or oral
consent entered on the minutes, or by taking part in the deliberations at such
meeting without objection, the doings of such meeting shall be as valid as if
had at a meeting regularly called and noticed, and at such meeting any business
may be transacted which is not excepted from the written consent to the
consideration of which no objection for want of notice is made at the time, and
if any meeting be irregular for want of notice or such consent, provided a
quorum was present at such meeting, the proceedings of said meeting may be
ratified and approved and rendered likewise valid and the irregularity or defect
therein waived by a writing signed by all parties having the right to vote at
such meeting; and such consent or approval of stockholders may be by proxy or
attorney, but all such proxies and powers of attorney must be in writing.
SECTION 3. Whenever any notice whatever is required to be given under the
provisions of the statute, of the Articles of Incorporation or of these Bylaws,
a waiver thereof in writing, signed by the person or persons entitled to said
notice, whether before or after the time stated therein, shall be deemed
equivalent thereto.
ARTICLE 8
---------
OFFICERS
SECTION 1. The officers of the corporation shall be chosen by the Board of
Directors and shall be a President, a Secretary and a Treasurer. Any person may
hold two or more offices.
SECTION 2. The Board of Directors at its first meeting after each annual
meeting of stockholders shall choose a Chairman of the Board who shall be a
Director, and shall choose a President, a Secretary and a Treasurer, none of
whom need be Directors.
SECTION 3. The Board of Directors may appoint a Vice-Chairman of the
Board, Vice-Presidents and one or more Assistant Secretaries and Assistant
Treasurers and such other officers and agents as it shall deem necessary who
shall hold their offices for such terms and shall exercise such powers and
perform such duties as shall be determined from time to time by the Board of
Directors.
SECTION 4. The salaries and compensation of all officers of the
corporation shall be fixed by the Board of Directors.
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SECTION 5. The officers of the corporation shall hold office at the
pleasure of the Board of Directors. Any officer elected or appointed by the
Board of Directors may be removed any time by the Board of Directors. Any
vacancy occurring in any office of the corporation by death, resignation,
removal or otherwise shall be filled by the Board of Directors.
SECTION 6. The Chairman of the Board shall preside at meetings of the
stockholders and the Board of Directors, and shall see that all orders and
resolutions of the Board of Directors are carried into effect.
SECTION 7. The Vice-Chairman shall, in the absence or disability of the
Chairman of the Board, perform the duties and exercise the powers of the
Chairman of the Board and shall perform other such duties as the Board of
Directors may from time to time prescribe.
SECTION 8. The President shall be the chief executive officer of the
corporation and shall have active management of the business of the corporation.
He shall execute on behalf of the corporation all instruments requiring such
execution except to the extent the signing and execution thereof shall be
expressly designated by the Board of Directors to some other officer or agent of
the corporation.
SECTION 9. The Vice-Presidents shall act under the direction of the
President and in absence or disability of the President shall perform the duties
and exercise the powers of the President. They shall perform such other duties
and have such other powers as the President or the Board of Directors may from
time to time prescribe. The Board of Directors may designate one or more
Executive Vice-Presidents or may otherwise specify the order of seniority of the
Vice-Presidents. The duties and powers of the President shall descend to the
Vice-Presidents in such specified order of seniority.
SECTION 10. The Secretary shall act under the direction of the President.
Subject to the direction of the President he shall attend all meetings of the
Board of Directors and all meetings of the stockholders and record the
proceedings. He shall perform like duties for the standing committees when
required. He shall give, or cause to be given, notice of all meetings of the
stockholders and special meetings of the Board of Directors, and will perform
other such duties as may be prescribed by the President or the Board of
Directors.
SECTION 11. The Assistant Secretaries shall act under the direction of the
President. In order of their seniority, unless otherwise determined by the
President or the Board of Directors, they shall, in the absence or disability of
the Secretary, perform the duties and exercise the powers of the Secretary. They
shall perform other such duties and have such other powers as the President and
the Board of Directors may from time to time prescribe.
12. SECTION The Treasurer shall act under the direction of the President.
Section Subject to the direction of the President he shall have custody of the
corporate funds and securities and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the corporation and shall
deposit all money and other valuable effects in the name and to the credit of
the corporation in such depositories as may be designated by the Board of
Directors. He shall disburse the funds of the corporation as may be ordered by
the
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President or the Board of Directors, taking proper vouchers for such
disbursements, and shall render to the President and the Board of Directors, at
its regular meetings, or when the Board of Directors so requires, an account of
all his transactions as Treasurer and of the financial condition of the
corporation.
If required by the Board of Directors, the Treasurer shall give
the corporation a bond in such sum and with such surety as shall be satisfactory
to the Board of Directors for the faithful performance of the duties of his
office and for the restoration to the corporation, in case of his death,
resignation, retirement or removal from office, of all books, papers, vouchers,
money and other property of whatever kind in his possession or under his control
belonging to the corporation.
SECTION 13. The Assistant Treasurers in order of their seniority, unless
otherwise determined by the President or the Board of Directors, shall, in the
absence or disability of the Treasurer, perform the duties and exercise the
powers of the Treasurer. They shall perform such other duties and have such
other powers as the President or the Board of Directors may from time to time
prescribe.
ARTICLE 9
---------
CERTIFICATES OF STOCK
SECTION 1. Every stockholder shall be entitled to have a certificate
signed by the President or a Vice- President and the Treasurer or an Assistant
Treasurer, or the Secretary or an Assistant Secretary of the corporation,
certifying the number of shares owned by him in the corporation. If the
corporation shall be authorized to issue more than one class of stock or more
that one series of any class, the designations, preferences and relative,
participating, optional or other special rights of the various classes of stock
or series thereof and the qualifications, limitations or restrictions of such
rights, shall be set forth in full or summarized on the face or back of the
certificate which the corporation shall issue to represent such stock.
SECTION 2. If a certificate is signed (a) by a transfer agent other than the
corporation or its employees or (b) by a registrar other than the corporation or
its employees, the signatures of the officers of the corporation may be
facsimiles. In case any officer who has signed or whose facsimile signatures
have been placed upon a certificate shall cease to be such officer before such
certificate is issued, such certificate may be issued with the same effect as
though the person had not ceased to be such officer. The seal of the
corporation, or a facsimile thereof, may, but need not be, affixed to
certificates of stock.
SECTION 3. The Board of Directors may direct a new certificate or
certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost or destroyed
upon the making of an affidavit of that fact by the person claiming the
certificate of stock to be lost or destroyed. When authorizing such issue of a
new certificate or certificates, the Board of Directors may, in its discretion
and as a condition precedent to the issuance thereof, require the owner of such
lost or destroyed certificate or certificates, or his legal representative, to
advertise the same in such manner as it shall require and/or give the
corporation a bond in such sum as it may direct as indemnity against
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<PAGE>
any claim that may be made against the corporation with respect to the
certificate alleged to have been lost or destroyed.
SECTION 4. Upon surrender to the corporation or the transfer agent of the
corporation of a certificate for shares duty endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the corporation, if it is satisfied that all provisions of the laws and
regulations applicable to the corporation regarding transfer and ownership of
shares have been compiled with, to issue a new certificate to the person
entitled thereto, cancel the old certificate and record the transaction upon its
books.
SECTION 5. The Board of Directors may fix in advance a date not exceeding
sixty (60) days nor less than ten (IO) days preceding the date of any meeting of
stockholders, or the date of the payment of any dividend, or the date of the
allotment of rights, or the date when any change or conversion or exchange of
capital stock shall go into effect, or a date in connection with obtaining the
consent of stockholders for any purpose, as a record date for the termination of
the stockholders entitled to notice of and to vote at any such meeting, and any
adjournment thereof, or entitled to receive payment of any such dividend, or to
give such consent, and in the such case, such stockholders, and only such
stockholders as shall be stockholders of record on the date so fixed, shall be
entitled to notice of and to vote as such meeting, or any adjournment thereof,
or to receive such payment of dividend, or to receive such allotment of rights,
or to exercise such rights, or to give such consent, as the case may be,
notwithstanding any transfer of any stock on the books of the corporation after
such record date fixed as aforesaid.
SECTION 6. The corporation shall be entitled to recognize the person
registered on its books as the owner of the share to be the exclusive owner for
all purposes including voting and dividends, and the corporation shall not be
bound to recognize any equitable or other claims to or interest in such shares
or shares on the part of any -other person, whether or not it shall have express
or other notice thereof, except as otherwise provided by the laws of Nevada.
ARTICLE 10
----------
GENERAL PROVISIONS
SECTION 1. Dividends upon the capital stock of the corporation, subject to
the provisions of the Articles of Incorporation, if any, may be declared by the
Board of Directors at any regular or special meeting, pursuant to law. Dividends
may be paid in cash, in property or in shares of the capital stock, subject to
the provisions of the Articles of Incorporation.
SECTION 2. Before payment of any dividend, there may be set aside out of
any funds of the corporation available for dividends such sum or sums as the
Directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends or for
repairing and maintaining any property of the corporation, or for such other
purpose as the Directors shall think conducive to the interests of the
corporation, and the Directors may modify or abolish any such reserve in the
manner in which it was created.
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SECTION 3. All checks or demands for money and notes of the corporation
shall be signed by such officer or officers or such other person or persons as
the Board of Directors may from time to time designate.
SECTION 4. The fiscal year of the corporation shall be fixed by resolution
of the Board of Directors.
SECTION 5. The corporation may or may not have a corporate seal, as may be
from time to time determined by resolution of the Board of Directors. If a
corporate seal is adopted, it shall have inscribed thereon the name of the
corporation and the words "Corporate Seal" and "Nevada". The seal may be used by
causing it or a facsimile thereof to be impressed or affixed or in any manner
reproduced.
ARTICLE 11
----------
INDEMNIFICATION
Every person who was or is a party or is a threatened to be made a
party to or is involved in any action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he or a
person of whom he is the legal representative is or was a Director or officer of
the corporation or is or was serving at the request of the corporation or for
its benefit as a Director or officer of another corporation, or as its
representative in a partnership, joint venture, trust or other enterprise, shall
be indemnified and held harmless to the fullest legally permissible under the
General Corporation Law of the State of Nevada from time to time against all
expenses, liability and loss (including attorney's fees, judgments, fines and
amounts paid or to be paid in settlement) reasonably incurred or suffered by him
in connection therewith. The expenses of officers and Directors incurred in
defending a civil or criminal action, suit or proceeding must be paid by the
corporation as they are incurred and in advance of the final disposition of the
action, suit or proceeding upon receipt of an undertaking by or on behalf of the
Director or officer to repay the amount if it is ultimately determined by a
court of competent jurisdiction that he is not entitled to be indemnified by the
corporation. Such right of indemnification shall be a contract right which may
be enforced in any manner desired by such person. Such right of indemnification
shall not be exclusive of any other right which such Directors, officers or
representatives may have or hereafter acquire and, without limiting the
generality of such statement, they shall be entitled to their respective rights
of indemnification under any bylaw, agreement, vote of stockholders, provision
of law or otherwise, as well as their rights under this Article.
The Board of Directors may cause the corporation to purchase and
maintain insurance on behalf of any person who is or was a Director or officer
of the corporation, or is or was serving at the request of the corporation as a
Director or officer of another corporation, or as its representative in a
partnership, joint venture. trust or other enterprise against any liability
asserted against such person and incurred in any such capacity or arising out of
such status, whether or not the corporation would have the power to indemnify
such person.
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The Board of Directors may form time to time adopt further Bylaws with
respect to indemnification and amend these and such Bylaws to provide at all
times the fullest indemnification permitted by the General Corporation Law of
the State of Nevada.
ARTICLE 12
----------
Amendments
SECTION 1. The Bylaws may be amended by a majority vote of all the stock
issued and outstanding and entitled to vote at any annual or special meeting of
the stockholders, provided notice of intention to amend shall have been
contained in the notice of the meeting.
SECTION 2. The Board of Directors by a majority vote of the whole Board at
any meeting may amend these Bylaws, including Bylaws adopted by the
stockholders, but the stockholders may from time to time specify particulars of
the Bylaws which shall not be amended by the Board of Directors.
APPROVED AND ADOPTED March 5, 1999.
CERTIFICATE OF THE SECRETARY
----------------------------
I, Carol Krushnisky, hereby certify that I am the Secretary of ZEB ORO
EXPLORATIONS INC., and the foregoing Bylaws, consisting of 12 pages, constitute
the code of Bylaws of this company as duly adopted at a regular meeting of the
Board of Directors of the corporation held on .
IN WITNESS WHEREOF, I have hereunto subscribed my name on March 5, 1999.
/s/ "Carol Krushnisky"
- ----------------------------
Carol Krushnisky - Secretary
52
Exhibit 3(a)
NOT VALID UNLESS COUNTERSIGNED BY TRANSFER AGENT
INCORPORATED UNDER THE LAWS OF THE STATE OF NEVADA
SPECIMEN STOCK CERTIFICATES
CUSIP NO. 989203 10 4
(LOGO) SHARES
ZEB ORO
EXPLORATIONS INC.
Authorized Common Stock: 200,000,000 Shares
Par Value: $0.001
THIS CERTIFIES THAT
IS THE RECORD HOLDER OF
-Shares of ZEB ORO EXPLORATIONS INC. Common Stock -
transferable on the books of the Corporation in person or by duly authorized
attorney upon surrender of this Certificate properly endorsed. This Certificate
is not valid until countersigned by the Transfer Agent and registered by the
Registrar.
Witness the facsimile seal of the Corporation and the facsimile of its duly
authorized officers.
Dated:
"Carol Krushnisky "Steven Bruce"
- --------------------------------- ---------------------------------
Secretary President
Not valid unless countersigned by transfer agent
Countersigned Registered:
Nevada Agency and Trust Company
50 WEST LIBERTY STREET, SUITE 880
RENO, NEVADA, 89501
By --------------------------------
Authorized Signature
53
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TRANSFER AGENT AND REGISITRAR AGREEMENT
THIS AGREEMENT made and entered into this 10th day of March, 1999 by and
between:
NEVADA AGENCY AND TRUST COMPANY, 50 West Liberty Street, Suite 880, Reno, Nevada
89501, hereinafter called "TRANSFER AGENT," and
ZEB ORO EXPLORATIONS INC., 320 - 1100 Melville Street, Vancouver, B.C. V6E
4A6, a Nevada corporation, hereinafter called "COMPANY."
NOW THEREFORE, for valuable consideration and the mutual promises
herein contained, the parties hereto agree as follows, to wit:
1. [APPOINTMENT OF TRANSFER AGENT] The COMPANY hereby appoints TRANSFER
AGENT as the Transfer Agent and Registrar for the COMPANY'S Common Stock,
commencing on this 10th day of March, 1999.
2. [COMPANY'S DUTY] The COMPANY agrees to deliver to TRANSFER AGENT a
complete up-to-date stockholder list showing the name of the individual
stockholder, current address, the number of shares and the certificate numbers,
it being specifically understood and agreed that the TRANSFER AGENT is not to be
held responsible for any omissions or error, that may leave occurred prior to
this Agreement whether on the part of the COMPANY itself or its previous
transfer agent or agents. The Company hereby agrees to indemnify TRANSFER AGENT
in this regard.
3. [STOCK CERTIFICATES] The COMPANY agrees to provide an adequate number
of stock certificates to handle the COMPANY'S transfers on a current basis. Upon
receipt of TRANSFER AGENT'S request, the COMPANY agrees to furnish additional
stock certificates as TRANSFER AGENT deems necessary considering the volume of
transfers. The stork certificates shall be supplied at COMPANY'S cost. The
TRANSFER AGENT agrees to order stock certificates from its printer upon request
of the COMPANY.
4. [TRANSFER AGENT DUTIES] TRANSFER AGENT agrees to handle the Company's
transfers, record the same, and maintain a ledger, together with a file
containing all correspondence relating to said transfers, which records shall be
kept confidential and be available to the COMPANY and its Board of Directors, or
to any person specifically authorized by the Board of Directors to review the
records which shall be made available by TRANSFER AGENT during the regular
business hours.
5. [TRANSFER AGENT REGISTRATION] TRANSFER AGENT warrants that it is
registered as a Transfer Agent with the United Stakes Securities and Exchange
Commission under the Securities Exchange Act of 1934, as amended.
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6. [STOCKHOLIDER LIST] From time to time, as necessary for Company
stockholders meeting or mailings, the TRANSFER AGENT will certify and make
available to the current, active stockholders list for COMPANY purposes. it is
agreed that a reasonable charge for supplying such list will be made by TRANSFER
AGENT to the COMPANY. It is further agreed that in the event the Transfer Agent
received a request or a demand from a stockholder or the attorney of agent for a
stockholder, for a list of stockholders, the TRANSFER AGENT will serve notice of
such request by certified mail to the COMPANY. The COMPANY will have forty-eight
(48) hours to respond in writing to the TRANSFER AGENT. If the Company orders
the TRANSFER AGENT to withhold delivery of a list of stockholders as requested,
the TRANSFER AGENT agrees to follow the orders of the COMPANY. The COMPANY will
then follow the procedure set forth in the Uniform Commercial Code to restrain
the TRANSFER AGENT from making delivery of a stockholders list.
7. [TRANSFER FEE] TRANSFER AGENT agrees to assess and collect from the
person requesting a transfer and/or the transferror, a fee of Fifteen and No/100
dollars ($15.OO) for each stock certificate issued, except original issues of
stock or warrant certificates, which fees shall be paid by the COMPANY. This fee
may be decreased or increased at any time by the TRANSFER AGENT. This fee shall
be the property of the TRANSFER AGENT.
8. [ANNUAL FEE] The Company agrees to pay the TRANSFER AGENT an annual
fee of TWELVE HUNDRED DOLLARS ($1,200.00) each year. This fee reimburses the
Transfer Agent for the expense and time required to respond to the written and
oral inquiries from brokers and the investing public, as well as maintaining the
transfer books and records of the corporation. The annual fee will be due on 1st
of July of each year and is subject to annual review.
8 [TERMINATION] This Agreement may be terminated by either party given
written notice of such termination to the other party at least ninety (90) days
before the effective date. The TRANSFER AGENT shall return all of the transfer
records to the COMPANY and its duties and obligations as TRANSFER AGENT shall
cease at that time. The TRANSFER AGENT will be paid a Termination Fee of $1.00
per registered stockholder of the Company at the time the written termination
notice is served.
10. [COMPANY STATUS] The COMPANY will promptly advise the TRANSFER AGENT
of any changes or amendments to the Articles of Incorporation, any significant
changes in corporate status, changes in officers, etc., and of all changes in
filing status with the Securities and Exchange Commission, or any state entity,
and to hold the, Transfer Agent harmless from its failure to do so.
11. [INDEMNIFICATION OF TRANSFER AGENT] The COMPANY agrees to indemnify
and hold harmless the TRANSFER AGENT, from any and all loss, liability of
damage, including reasonable attorneys' fees and expenses, arising out of, or
resulting from the assertion against the TRANSFER AGENT of any claims, debts or
obligations in connection with any of the TRANSFER AGENT'S duties as set forth
in the Agreement, and specifically it is understood that the
TRANSFER AGENT shall have the right to apply to independent counsel at the
Company's expense in following the Company's directions and orders.
55
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12. [COUNTERPARTS] This Agreement may be executed in any number of
counterparts, each of which, when executed and delivered, shall be an original,
but all such counterparts shall constitute one and the same instrument.
8 [NOTICE] Any notice under this Agreement shall be deemed to have
been sufficiently given if sent by registered or certified mail, postage
prepaid, addressed as follows:
TO THE COMPANY:
Michael J. Kennaugh
ZEB ORO EXPLORATIONS INC.
320 - 1100 Melville Street
Vancouver, B.C. V6E 4A6
TO THE TRANSFER AGENT:
NEVADA AGENCY AND TRUST COMPANY
50 West Liberty Street, Suite 880 Reno,
Nevada 89501
14. [MERGER CLAUSE] This Agreement supersedes all prior agreements and
understandings between the parties and may not be changed or terminated orally,
and no attempted change, termination or waiver of any of the provisions hereof
shall binding unless in writing and signed by the parties hereto.
15. [GOVERNING LAW] This Agreement shall be governed by and construed
in accordance with the laws of the State of Nevada.
THIS AGREEMENT has been executed by the parties hereto as of the day and
year 1st above written, by the duly authorized officer or officers of said
parties, and the same will be binding upon the assigns and successors in
interest of the parties hereto.
NEVADA AGENCY AND TRUST COMPANY
TRANSFER AGENT
BY /S/ "AMANDA CARDINALLI"
-------------------------------
AMANDA CARDINALLI, VICE PRESIDENT
ZEB ORO EXPLORATIONS INC.
COMPANY
BY /S/ "MICHAEL J. KENNAUGH"
-------------------------------
MICHAEL J. KENNAUGH
PRESIDENT
56
EXHIBIT 10(I)
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT
ZEB ORO EXPLORATIONS INC.
We hereby consent to the use of our report dated May 28, 1999, in the
registration statement of Zeb Oro Explorations Inc. filed in Form 10-SB in
accordance with Section 12 of the Securities Exchange Act of 1934.
/s/ L. REX ANDERSEN
-------------------------------
ANDERSEN ANDERSEN & STRONG, L.C.
Salt Lake City, Utah
May 28, 1999
57
