As filed with the Securities and Exchange Commission on October 15, 2004.
As filed with Registration Number: 333-100636
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM SB-2--AMENDMENT #6
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
ENWIN RESOURCES INC.
(Exact name of registrant as specified in its charter)
NEVADA 1081 98-0379370
------ ---- ----------
(State of incorporation) (Primary Standard Industrial (I.R.S. Employer
Classification Code Number) Identification Number)
ENWIN RESOURCES INC. NEVADA AGENCY AND TRUST CO.
700 West Pender Street, Suite 1204 50 West Liberty Street, Suite 880
Vancouver, BC, Canada V6C 1G8 Reno, Nevada 89501
(604) 505-5825 (775) 322-0626
-------------- --------------
(Address, Zip Code and Telephone Number of (Name, address and telephone
Principal Executive Offices) number of agent for service)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the effective date of this Registration Statement.
If this Form is filed to register additional common stock for an offering under
Rule 462(b) of the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. If this Form is a post-effective
amendment filed under Rule 462(c) of the Securities Act, check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
If this Form is a post-effective amendment filed under Rule 462(d) of the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. |__| If delivery of the prospectus is expected to be made under Rule
434, please check the following box. |__|
CALCULATION OF REGISTRATION FEE
Securities Amount Aggregate
to be to be Offering Price Offering Registration
Registered Registered Per Share Price Fee
---------- ---------- --------- ----- ---
Common Stock 2,000,000 $ 0.10 $ 200,000 $25.34
REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON DATES AS MAY BE
NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER
AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL
THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES
ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON DATES
AS THE COMMISSION, ACTING UNDER SAID SECTION 8(a), MAY DETERMINE.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
Prospectus
ENWIN RESOURCES INC.
Shares of Common Stock
No Minimum - 2,000,000 Maximum
Before this offering, there has been no public market for the common stock.
We are offering up to a total of 2,000,000 shares of common stock on a best
efforts, no minimum, 2,000,000 shares maximum. The offering price is $0.10 per
share. There is no minimum number of shares that we have to sell. There will be
no escrow account. We will immediately use all money received from the offering
and there will be no refunds. The offering will be for a maximum period of 90
days from the effective date and may be extended for an additional 90 days if we
so choose to do so.
Michael Bebek, , an officer and director of our Company will be the only person
offering or selling our shares.
INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS" STARTING AT
PAGE 6.
Maximum Net
Price Per Share Aggregate Offering Price Proceeds to Us
--------------- ------------------------ --------------
Common Stock $0.10 $200,000 $150,000
There is no minimum number of shares that must be sold in this offering.
Accordingly, there is no assurance that we will achieve the proceeds level
described in the above table.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. It is illegal to tell you otherwise.
The date of this prospectus is ____________________.
TABLE OF CONTENTS
Page No.
--------
Summary of Prospectus 5
Risk Factors 7
Risks Associated with Our Company 7
Risks Associated with this Offering 9
Use of Proceeds 11
Determination of Offering Price 12
Dilution of the Price You Pay for Your Shares 12
Plan of Distribution; Terms of the Offering 15
Business 16
Management's Discussion and Analysis of Financial Condition
and Results of Operations 26
Management 28
Executive Compensation 31
Principal Shareholders 32
Description of Securities 33
Certain Transactions 34
Litigation 34
Experts 34
Legal Matters 34
Financial Statements F-1- F-12
SUMMARY OF OUR OFFERING
This summary highlights important information about our business and about this
offering. Because it is a summary, it does not contain all the information you
should consider before investing in the common stock. So, please read the entire
prospectus.
Our Business
We are an exploration stage company. We have an option to acquire an undivided
100% interest in one property. We intend to explore for economic mineralization
on our property. We obtained our interest in our property by entering into an
option agreement with Cadre Capital to acquire an undivided 100% interest in a
mineral property in British Columbia, Canada. We paid $10,000 to Cadre upon
execution of the option agreement and have spent $31,785 on the property to
date. To earn our 100% interest, we were required to expend more than $800,000
in respect of our property by the end of 2006. However, pursuant to an amendment
dated March 11, 2004, we are now required to expend a total of not less than
$350,000 by June 30, 2007. See Exhibit 10.2. The financing from this offering
will be used to pay for our initial program of exploration.
There is presently no assurance that a commercially viable mineral deposit, a
reserve, exists in the company's property until sufficient exploration work is
done and a comprehensive evaluation based upon such work concludes economic
viability
We are a mineral exploration company with an option to acquire an undivided 100%
interest in one property. Our property has no proven or probable mineral
reserves. "Probable mineral reserves" is a term of art in the mining business
which means an economically mineable part of an indicated, and in sometimes
measured, mineral resource demonstrated by at least a preliminary feasibility
study.
We do not consider ourselves as a blank-check company. We have a specific
business plan to operate as a mineral exploration company, although we require
funding from this offering before we can implement it. Our business plan does
not contemplate any intention to engage in a merger or acquisition with an
unidentified company or companies, or other entity and we have no arrangements
or understandings of any kind to undertake activities normally associated with a
blank-check company.
The terms of our property option agreement provide that a late or missing
payment will entitle the optionor to cancel the agreement unless such right is
waived in writing. A total of $11,943 was spent on the property by December 31,
2002. A total of $31,785 has been spent on the property to date. The requirement
to pay the full amount was waived, in writing, given that the exploration
expenses were less than anticipated.
Our administrative office is located at 700 West Pender Street, Suite 1204,
Vancouver, BC, Canada V6C 1G8, telephone (604) 505-5825 and our registered
statutory office is located at 50 West Liberty Street, Suite 880, Reno, Nevada
89501. Our fiscal year end is August 31.
Mr. Bebek is the sole officer of our Company. Messrs. Bebek and Strickland are
our only directors. Mr. Bebek is currently our only shareholder and will
continue to control 60% of our outstanding common stock even if the maximum
number of shares is sold.
Limited exploration work has been done on our property, with approximately
$250,000 having been spent by a previous owner, and no commercially exploitable
reserves have been identified.
We are offering up to a total of 2,000,000 shares of common stock on a best
efforts, no minimum, 2,000,000 shares maximum.
The Offering
Following is a brief summary of this offering:
Securities being offered Up to 2,000,000 shares of common stock, par
value $0.001.
Offering price per share $ 0.10
Offering period The shares are being offered for a period not
to exceed 90 days, unless extended by our
board of directors for an additional 90 days.
Maximum net proceeds
to our company Up to $150,000.
Use of proceeds We will use the proceeds to pay for offering
expenses, research and initial exploration
expenses. We believe that the initial
exploration work will cost up to $150,000 and
will take approximately one year.
Number of shares
outstanding before
the offering 3,000,000
Number of shares
outstanding after
the offering 5,000,000
Summary Financial Information
We are a company without revenues, we have minimal assets, we have a deficit
stockholders' equity and we have incurred losses since inception. Our fiscal
year end is August 31.
The following financial information summarizes the more complete historical
financial information at the end of this prospectus.
As of August 31, 2004 As of August 31, 2003
(Audited) (Audited)
--------- ---------
Balance Sheet
Total Assets $ 780 $ 7,303
Total Liabilities $ 75,001 $ 54,301
Stockholders Equity (Deficit) $ (74,221) $ (46,998)
Income Statement
Revenue $ 0 $ 0
Total Expenses $ (32,407) $ (30,733)
Net Loss $ (32,407) $ (30,733)
There are notes that are integral to the financial statements at the end of this
prospectus.
RISK FACTORS
Please consider the following risk factors before deciding to invest in the
common stock.
RISKS ASSOCIATED WITH OUR COMPANY:
1. Auditors' Going Concern.
In our most recent audited financial statements as at August 31, 2004, our
auditors have issued a going concern with regard to our losses and accumulated
deficit. Since our inception on July 3, 2002, and as at August 31, 2004, we
incurred a net loss of $(85,658), against no revenue. Further, in order to meet
our exploration and development of our mineral interests, we will be required to
raise additional cash through debt or equity financing, and thus in need of
additional capital. Our ability to continue as a going concern is dependent upon
obtaining the additional financing.
2. We lack an operating history and have losses that we expect to continue into
the future.
We were incorporated on July 3, 2002 and we have only just commenced our
proposed business operations having made limited exploration expenditures on our
property and we have not yet realized any revenues. We have no operating history
upon which an evaluation of our future success or failure can be made. Our net
loss since inception is $(85,658). Our ability to achieve and maintain
profitability and positive cash flow is dependent upon the following:
Our ability to locate a profitable mineral property;
Our ability to generate revenues; and
Our ability to reduce exploration costs.
Based upon current plans, we expect to incur operating losses in future periods.
This will happen because there are expenses associated with the research and
exploration of our mineral properties. We may not be successful in generating
revenues in the future. Failure to generate revenues will cause us to go out of
business.
3. We have no known ore reserves and we may not find any economic mineralization
or if we find economic mineralization, production may not be profitable.
We have no known ore reserves. We have not identified any economic
mineralization on the property and we may not ever find any economic
mineralization. Even if we find that there is economic mineralization on our
property, we may not be able to recover the economic mineralization. Even if we
recover economic mineralization, we may not make a profit. If we cannot find
economic mineralization or it is not economical to recover the economic
mineralization, we will have to cease operations.
4. We may require additional financing beyond this offering to complete our
required exploration expenditures. The first $50,000 raised in this offering
will be used to pay offering expenses. All remaining financing from this
offering will be used for initial exploration work. If we do not raise enough
money for our initial exploration, we will have to delay exploration or go out
of business. Because we are small and do not have much capital, we must limit
our exploration.
Pursuant to the terms of our initial property option agreement, we were required
to expend approximately $800,000 on exploration of our property by December 31,
2005. However, on March 11, 2004, we entered into an amendment to the option
agreement and are now required to expend $350,000 by the end of June, 2007.
Since we are only raising $200,000 in this offering for initial exploration
expenditures, we will require additional financing to meet our long term
obligations in respect of our property. We are in the very early exploration
stage and need the proceeds from our offering to start our initial explorations
for economic mineralization. Since there is no minimum in this offering and no
refunds on sold shares, you may be investing in a company that will not have the
funds necessary to commence or complete its operations. Pursuant to the terms of
the amended option agreement, we are required to pay the following additional
amounts to Cadre: Of the $25,000 required to be paid on or before December 31,
2002, only $11,943 of the payment was made by us due to actual exploration
expenses being less than estimated. By June 30, 2005, we are required to expend
$25,000 on exploration; an additional $75,000 by June 30, 2006 and another
$250,000 by June 30, 2007. The terms of the Spring Lake property option
agreement entitle the optionor (Cadre) to cancel the option in the event that a
payment is not made by us in a timely manner, unless the optionor (Cadre) waives
such right in writing. In this instance, Cadre waived in writing its right to
terminate the agreement in respect of the lesser amount paid. Because we are
small and do not have much capital, we must limit our exploration. Because we
may have to limit our exploration, we may not find mineralized material,
although our property may contain mineralized material. If we do not find
mineralized material, we will cease operations. We may not have enough money to
complete the exploration of our property.
Because we are exploring undeveloped land, we do not know how much we will have
to spend to find out if there is mineralized material on our property. It could
cost as much as $350,000 or more to find out. The first $50,000 we raise,
however, will be used to cover the cost of this offering before we spend any
money on our exploration program. In addition, we do not know how much money we
will raise in this offering. If it turns out that we have not raised enough
money to complete our initial exploration program, we will try to raise
additional funds from a second public offering, a private placement or loans. In
the event that we are unsuccessful in discovering economic mineralization or
mineralised material during our initial exploration, we will need to raise
additional financing to continue with explorations. In the event that we are
unable to raise more financing to continue our obligations, or decide do not to
do so as a result of poor results during our initial explorations, we will lose
our interest in our property. If we lose our interest in our property we will
have to acquire another property and raise financing in respect of it. If we are
unable to do so, we will go out of business and you will lose your investment.
5. Rain and snow may make the road leading to our property impassable. This will
delay our proposed exploration operations that could prevent us from working.
While we plan to conduct our exploration year round, it is possible that snow or
rain could cause roads leading to our claims to be impassable. When roads are
impassable, we are unable to work.
6. We have no insurance on the Spring Lake property. Our business is subject to
the normal operating risks common to companies engaged exploration and if one of
more of these risks materialize this may result in substantial financial harm to
our company because we do not have insurance.
Our business is subject to many operational risks common to exploration
companies. These risks include hazards such as blowouts, explosions, fires,
pollution, and environmental hazards. We have not obtained insurance on the
Spring Lake property in respect of these risks because we believe the cost of
doing so is excessive and, in accordance with industry practice, many of our
contractors may also elect not to obtain insurance against some of these risks.
The occurrence of a risk not fully covered by insurance could severely harm our
financial situation.
7. We may not have access to all of the supplies and materials we need to begin
exploration that could cause us to delay or suspend operations.
Competition and unforeseen limited sources of supplies in the industry could
result in occasional spot shortages of supplies, such as explosives, and certain
equipment such as bulldozers and excavators that we might need to conduct
exploration. We have not attempted to locate or negotiate with any suppliers of
products, equipment or materials. We will attempt to locate products, equipment
and materials after this offering is complete. If we cannot find the products
and equipment we need, we will have to suspend our exploration plans until we do
find the products and equipment we need.
8. Our officers and directors will be devoting limited time to our activities
which may harm our potential business.
Our president and director, Michael Bebek, will be devoting only approximately
50% of his professional time to our operations once this offering is completed.
Only one of our directors, Derrick Strickland, has any experience within the
resource and exploration industry and he will be devoting only approximately 5%
of his professional time to our operations. The lack of devotion of time by our
directors and officers may harm our business.
RISKS ASSOCIATED WITH THIS OFFERING:
9. Because Mr. Bebek is risking a small amount of capital and property, while
you on the other hand are risking up to $200,000, if we fail you will absorb
most of our loss. Mr. Bebek will not lose anything in this offering, but will
gain if proceeds are used to repay his loans to the registrant. The estimated
$50,000 cost of the offering will be the first use of proceeds and no person
affiliated with the company will benefit from that payment. Such amounts are
estimated based on fees of lawyers, auditors, etc.
Mr. Bebek, our only shareholder will receive a substantial benefit from your
investment. As of the fiscal year ended August 31, 2004, he has deposited cash
of $68,301 through Promissory Notes. In September, 2004, Mr. Bebek made an
additional advance of $20,000. He will also provide small loans to fund the
company's working capital until completion of this offering. You, on the other
hand, will be providing all of the cash for our operations. As a result, if we
cease operations for any reason, you will lose your investment while Mr. Bebek
will lose only a very small amount, perhaps as little as $88,301. Mr. Bebek will
not lose anything in this offering, but will gain if proceeds are used to repay
his loans to the registrant. The estimated $50,000 cost of the offering will be
the first use of proceeds and no person affiliated with the company will benefit
from that payment. Such amounts are estimated based on fees of lawyers,
auditors, etc.
10. Because there is no public trading market for our common stock, you may not
be able to resell you stock.
There is currently no public trading market for our common stock. Therefore,
there is no central place, such as stock exchange or electronic trading system,
to resell your shares. If you do want to resell your shares, you will have to
locate a buyer and negotiate your own sale.
11. Because we will close the offering even if we do not raise enough funds to
complete exploration, you may lose your investment.
There is no minimum number of shares that must be sold in this offering, even if
we raise a nominal amount of money. Any money we receive will be immediately
appropriated by us. We may not raise enough money to start or complete
exploration. No money will be refunded to you under any circumstances. As a
result, you may lose your investment.
12. Because the SEC imposes additional sales practice requirements on brokers
who deal in our shares which are penny stocks, some brokers may be unwilling to
trade them. This means that you may have difficulty in reselling your shares and
may cause the price of the shares to decline.
Our shares qualify as penny stocks and are covered by Section 15(g) of the
Securities Exchange Act of 1934 which imposes additional sales practice
requirements on broker/dealers who sell our securities in this offering or in
the aftermarket. In particular, prior to selling a penny stock, broker/dealers
must give the prospective customer a risk disclosure document that: contains a
description of the nature and level of risk in the market for penny stocks in
both public offerings and secondary trading; contains a description of the
broker/dealers' duties to the customer and of the rights and remedies available
to the customer with respect to violations of such duties or other requirements
of Federal securities laws; contains a brief, clear, narrative description of a
dealer market, including "bid" and "ask" prices for penny stocks and the
significance of the spread between the bid and ask prices; contains the toll
free telephone number for inquiries on disciplinary actions established pursuant
to section 15(A)(i); defines significant terms used in the disclosure document
or in the conduct of trading in penny stocks; and contains such other
information, and is in such form (including language, type size, and format), as
the SEC requires by rule or regulation.
Further, for sales of our securities, the broker/dealer must make a special
suitability determination and receive from you a written agreement before making
a sale to you. Because of the imposition of the foregoing additional sales
practices, it is possible that brokers will not want to make a market in our
shares. This could prevent you from reselling your shares and may cause the
price of the shares to decline.
13. Because Mr. Bebek will own more than 50% of the outstanding shares after
this offering, he will be able to decide who will be directors and you may not
be able to elect any directors. Mr. Bebek's control prevents you from causing a
change in the course of our operations.
Even if we sell all 2,000,000 shares of common stock in this offering, Mr. Bebek
will still own 3,000,000 shares and will continue to control us. As a result,
after completion of this offering, regardless of the number of shares we sell,
Mr. Bebek will be able to elect all of our directors and control our operations.
Because Mr. Bebek will control us after the offering, regardless of the number
of shares sold, your ability to cause a change in the course of our operations
is eliminated. As such, the value attributable to the right to vote is gone.
This could result in a reduction in value to the shares you own because of the
ineffective voting power.
14. Our officers and directors will probably sell some of their shares if the
market price of the stock goes above $0.10. This will cause the price of our
common stock to fall, which will reduce the value of your investment.
A total of 3,000,000 shares of stock was issued to one of our officers and
directors. He paid an average price of $0.001. Subject to all applicable holding
periods, he will likely sell a portion of his stock if the market price goes
above $0.10. If he does sell his stock into the market, the sales may cause the
market price of the stock to drop.
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS.
Some discussions in this prospectus may contain forward-looking statements that
involve risks and uncertainties. A number of important factors could cause our
actual results to differ materially from those expressed in any forward-looking
statements made by us in this prospectus. Such factors include, those discussed
in "Risk Factors," "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and "Business," as well as those discussed elsewhere
in this prospectus. Forward-looking statements are often identified by words
like: believe, expect, estimate, anticipate, intend, project and similar
expressions, or words which, by their nature, refer to future events.
USE OF PROCEEDS
Our offering is being made on a best efforts -- no minimum basis. The net
proceeds to us after deducting offering expenses of $50,000 will be $150,000 if
all of the shares are sold. The first $50,000 raised will be used for offering
expenses. We will use the net proceeds, in order of priority, as follows:
Amount raised $50,000 $100,000 $150,000 $200,000
Allocation
----------
Offering expenses $50,000 $ 50,000 $ 50,000 $ 50,000
Exploration $ 0 $ 50,000 $100,000 $130,000
Working capital $ 0 $ 0 $ 0 $ 20,000
Note: None of the $200,000 raised in this offering will be used to repay Mr.
Bebek the $88,301 he has loaned us. Mr. Bebek does not intend to demand
repayment until the company is in a position to do so without harming its
business operations.
We have allocated a wide range of money for our initial exploration expenses.
That is because we do not know how much will ultimately be needed for
exploration and because we are required to expend a total of more than $800,000
on exploration of our property by the end of 2005. If we are successful in
immediately finding economic mineralization, we will stop exploring and go on to
develop the property. Our development expenditures will then satisfy our
obligations to expend money in respect of our property. On the other hand, if we
do not immediately find economic mineralization in our initial explorations, we
might continue to explore for economic mineralization on the property. If we
have to continue to explore for economic mineralization, the costs of
exploration will increase and we will have to spend up to more than $350,000 in
respect of our property. Pursuant to the option agreement we must pay Cadre a
minimum of $350,000 regardless of the amount of exploration we do.
Pursuant to the terms of the amended option agreement, we are required to expend
no less than $25,000 by June 30, 2005. We are also required to expend no less
than $75,000 by June 30, 2006 and an additional amount of no less than $250,000
by June 30, 2007. If we fail to pay any of these amounts we may lose our
interest in the property, unless Cadre waives the requirement. Of the $25,0000
required to be paid on or before December 31, 2002, only $11,943 of the payment
was made by us due to actual exploration expenses being less than estimated. The
terms of the Spring Lake property option agreement entitle the optionor to
cancel the option in the event that a payment is not made in a timely manner,
unless the optionor (Cadre) waives such right in writing. In this instance,
Cadre waived in writing its right to terminate the agreement in respect of the
lesser amount paid.
Working capital includes the cost of our office operations including rent,
telephone and utilities, printing, faxing, high-speed Internet service, the use
of secretarial services, and administrative expenses such as office supplies,
postage and delivery charges. Mr. Bebek has agreed to pay these expenses on our
behalf if we raise only between $50,000 to $150,000. There is no formal
documentation in respect of this arrangement.
Our offering expenses are comprised of SEC filing fees, legal and accounting
expenses, printing and transfer agent fees, and state securities registration
fees.
Since our inception, Mr. Bebek has advanced loans to us in the total sum of
$88,301, which were used for organizational and start-up costs, legal and
auditor fees, operating capital and for acquiring our option. There are no
documents reflecting the loans which do not bear interest, however we have
imputed interest at 8% per annum and they are not due on any date certain. Mr.
Bebek is a director, sole officer and principal stockholder of the company and
as such he intends to wait until the company is in a favorable position to repay
the amounts owed before demanding repayment. None of the $200,000 raised in the
offering will be used to repay Mr. Bebek the $88,301 he has loaned us. As
disclosed, Mr. Bebek does not intend to demand repayment until the company is in
a position to do so without harming its business operations.
Mr. Bebek will not receive any compensation for his efforts in selling our
shares.
While we currently intend to use the proceeds of this offering substantially in
the manner set forth above, we reserve the right to reassess and reassign the
use if, in the judgment of our board of directors, changes are necessary or
advisable. At present, no material changes are contemplated. Should there be any
material changes in the above projected use of proceeds in connection with this
offering, we will issue an amended prospectus reflecting the same.
DETERMINATION OF OFFERING PRICE
The price of the shares we are offering was arbitrarily determined in order for
us to raise up to a total of $200,000 in this offering. The offering price bears
no relationship whatsoever to our assets, earnings, book value or other criteria
of value. Among the factors considered were:
Our lack of an operating history
The proceeds to be raised by the offering
The amount of capital to be contributed by purchasers in this offering in
proportion to the amount of stock to be retained by our existing
stockholders, and
Our relative cash requirements
DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES
Dilution represents the difference between the offering price and the net
tangible book value per share immediately after completion of this offering. Net
tangible book value is the amount that results from subtracting total
liabilities and intangible assets from total assets. Dilution arises mainly as a
result of our arbitrary determination of the offering price of the shares being
offered. Dilution of the value of the shares you purchase is also a result of
the lower book value of the shares held by our existing stockholders.
As of August 31, 2004, the net tangible book value of our shares of common stock
was approximately Nil per share based upon 3,000,000 shares outstanding.
If 100% of the Shares Are Sold:
Upon completion of this offering, in the event that all of the shares are sold,
the net tangible book value of the 5,000,000 shares to be outstanding will be
$200,000, or approximately $0.01 per share. The net tangible book value of the
shares held by our existing stockholders will be increased by $0.04 per share
without any additional investment on their part. You will incur an immediate
dilution from $0.10 per share to $0.08 per share.
After completion of this offering, if 2,000,000 shares are sold, you will own
approximately 40% of the total number of shares then outstanding shares for
which you will have made a cash investment of $200,000, or $0.10 per share. Our
existing stockholders will own approximately 60% of the total number of shares
then outstanding, for which they have, or will have, made contributions of cash
totaling $3,000, or approximately $0.001 per share.
If 75% of the Shares Are Sold:
Upon completion of this offering, in the event 75% of the shares are sold, the
net tangible book value of the 4,500,000 shares to be outstanding will be
$150,000, or approximately $0.00 per share. The net tangible book value of the
shares held by our existing stockholders will be increased by $0.03 per share
without any additional investment on their part. You will incur an immediate
dilution from $0.10 per share to $0.09 per share.
After completion of this offering, if 1,500,000 shares are sold, you will own
approximately 33% of the total number of shares then outstanding shares for
which you will have made a cash investment of $150,000, or $0.10 per share. Our
existing stockholders will own approximately 67% of the total number of shares
then outstanding, for which they have, or will have, made contributions of cash
totaling $3,000, or approximately $0.001 per share.
If 50% of the Shares Are Sold:
Upon completion of this offering, in the event 50% of the shares are sold, the
net tangible book value of the 4,000,000 shares to be outstanding will be
$100,000, or approximately NIL per share. The net tangible book value of the
shares held by our existing stockholders will be increased by $0.018 per share
without any additional investment on their part. You will incur an immediate
dilution from $0.10 per share to NIL per share.
After completion of this offering, if 1,000,000 shares are sold, you will own
approximately 25% of the total number of shares then outstanding shares for
which you will have made a cash investment of $100,000, or $0.10 per share. Our
existing stockholders will own approximately 75% of the total number of shares
then outstanding, for which they have, or will have, made contributions of cash
totaling $3,000, or approximately $0.001 per share.
If 25% of the Shares Are Sold:
Upon completion of this offering, in the event 25% of the shares are sold, the
net tangible book value of the 3,500,000 shares to be outstanding will be
approximately NIL per share. The net tangible book value of the shares held by
our existing stockholders will be increased by NIL per share without any
additional investment on their part. You will incur an immediate dilution from
$0.10 per share to NIL per share.
After completion of this offering, if 500,000 shares are sold, you will own
approximately 14% of the total number of shares then outstanding shares for
which you will have made a cash investment of $50,000, or $0.10 per share. Our
existing stockholders will own approximately 86% of the total number of shares
then outstanding, for which they have, or will have, made contributions of cash
totaling $3,000, or approximately $0.001 per share.
The following table compares the differences of your investment in our shares
with the investment of our existing stockholders.
Existing Stockholders if all of the Shares are Sold:
Price per share $ 0.10
Net tangible book value per share before offering NIL
Potential gain to existing shareholders $ 200,000
Net tangible book value per share after offering $ 0.04
Increase to present stockholders in net tangible book
value per share after offering $ 0.015
Capital contributions $ 3,000
Number of shares outstanding before the offering 3,000,000
Number of shares after offering held by existing stockholders 3,000,000
Percentage of ownership after offering 60%
Purchasers of Shares in this Offering if all Shares Sold
Price per share $ 0.10
Dilution per share $ 0.08
Capital contributions $ 200,000
Number of shares after offering held by public investors 2,000,000
Percentage of ownership after offering 40%
Purchasers of Shares in this Offering if 75% of Shares Sold
Price per share $ 0.10
Dilution per share $ 0.09
Capital contributions $ 150,000
Number of shares after offering held by public investors 1,500,000
Percentage of ownership after offering 33%
Purchasers of Shares in this Offering if 50% of Shares Sold
Price per share $ 0.10
Dilution per share $ 0.10
Capital contributions $ 100,000
Number of shares after offering held by public investors 1,000,000
Percentage of ownership after offering 25%
Purchasers of Shares in this Offering if 25% of Shares Sold
Price per share $ 0.10
Dilution per share $ 0.12
Capital contributions $ 50,000
Number of shares after offering held by public investors 500,000
Percentage of ownership after offering 14%
PLAN OF DISTRIBUTION; TERMS OF THE OFFERING
We are offering up to a total of 2,000,000 shares of common stock on a best
efforts basis, no minimum, 2,000,000 shares maximum. The offering price is $0.10
per share. There is no minimum number of shares that we have to sell. There will
be no escrow account. All money received from the offering will be immediately
used by us and there will be no refunds. The offering will be for a period of 90
days from the effective date and may be extended for an additional 90 days if we
so choose to do so.
We will sell the shares in this offering through Michael Bebek, our sole officer
and a director. Mr. Bebek will contact persons with whom he has a preexisting
personal or business relationship. Mr. Bebek will receive no commission from the
sale of any shares. Mr. Bebek will not register as a broker-dealer under Section
15 of the Securities Exchange Act of 1934 in reliance upon Rule 3a4-1. Rule
3a4-1 sets forth those conditions under which a person associated with an issuer
may participate in the offering of the issuer's securities and not be deemed to
be a broker-dealer. The conditions are that:
1. The person is not subject to a statutory disqualification, as that term
is defined in Section 3(a)(39) of the Act, at the time of his
participation; and,
2. The person is not compensated in connection with his participation by
the payment of commissions or other remuneration based either directly
or indirectly on transactions in securities; and
3. The person is not at the time of their participation, an associated
person of a broker-dealer; and,
4. The person meets the conditions of Paragraph (a)(4)(ii) of Rule 3a4-1
of the Exchange Act, in that he (A) primarily performs, or is intended
primarily to perform at the end of the offering, substantial duties for
or on behalf of the Issuer otherwise than in connection with
transactions in securities; and (B) is not a broker or dealer, or an
associated person of a broker or dealer, within the preceding twelve
(12) months; and (C) do not participate in selling and offering of
securities for any Issuer more than once every twelve (12) months other
than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii).
Mr. Bebek is not subject to disqualification, is not being compensated, and is
not associated with a broker-dealer. Mr. Bebek is and will continue to be one of
our directors at the end of the offering and has not been during the last twelve
months and is currently not a broker/dealer or associated with a broker/dealer.
Mr. Strickland has not during the last twelve months and will not in the next
twelve months offer or sell securities for another corporation.
We intend to advertise, through tombstones, and hold investment meetings in any
states or provinces where the offering will be registered. We will not use the
Internet to advertise our offering. We will also distribute the prospectus to
potential investors at the meetings and to our friends and relatives who are
interested in us and a possible investment in the offering.
Mr. Bebek is the only person that will be selling shares in the offering. Mr.
Strickland will not be selling shares in the offering.
We confirm that we have not engaged and will not be engaging a finder in
connection with this offering.
Offering Period and Expiration Date
This offering will start on the date of this prospectus and continue for a
maximum period of 90 days. We may extend the offering period for an additional
90 days, or unless the offering is completed or otherwise terminated by us.
Procedures for Subscribing If you decide to subscribe for any shares in this
offering, you must
1.Execute and deliver a subscription agreement
2.Deliver a check or certified funds to us for acceptance or rejection.
All checks for subscriptions must be made payable to "ENWIN RESOURCES INC."
Right to Reject Subscriptions
We have the right to accept or reject subscriptions in whole or in part, for any
reason or for no reason. All moneys from rejected subscriptions will be returned
immediately by us to the subscriber, without interest or deductions.
Subscriptions for securities will be accepted or rejected within 48 hours after
we receive them.
BUSINESS
General
We were incorporated in the State of Nevada on July 3, 2002. We have acquired an
option to acquire an undivided 100% interest in one property for purposes of
exploration and we intend to acquire more exploration properties when we are in
a position to do so. We maintain our statutory registered agent's office at 50
West Liberty Street, Suite 880, Reno, Nevada, 89501 and our business office is
located at 700 West Pender Street, Suite 1204, Vancouver, BC, Canada V6C 1G8.
Our telephone number is (604) 505-5825.
We are a company without revenues, we have minimal assets, we have a deficit
stockholders' equity and we have incurred losses since inception.
Background
In July 2002, we entered into an option agreement with Andrew Molnar, doing
business as Cadre Capital ("Cadre"), to acquire an undivided 100% interest in a
mineral property containing five mining claims in British Columbia, Canada. The
property, known as the Spring Lake Property (the "Property"), consists of five
mining claims known as the Summer Claims 1-5 located in Lac La Hache, British
Columbia. We paid $10,000 to Cadre upon execution of the option agreement and
paid an additional $10,000 on or before November 30, 2003.
Pursuant to the terms of the option agreement we must retain the services of Rio
Minerals Ltd. to perform all exploration and/or development work on the
Property. We were also required to expend the following amounts on the
exploration and/or development of the Property:
(a) a cumulative total of not less than $25,000 on or before December 31,
2002;
(b) a cumulative total of not less than $35,000 on or before December 31,
2003;
(c) a cumulative total of not less than $150,000 on or before December 31,
2004; and
(d) a cumulative total of not less than $500,000 on or before December 31,
2005. However, pursuant to the terms of an addendum to the original
option agreement, dated March 11, 2004, we must expend the following
amounts on the exploration and/or development of the Property:
(a) exploration-work program of not less than $25,000 by June 30,
2005;
(b) exploration-work program of not less than $75,000 by June 30,
2006;
(c) exploration-work program of not less than $250,000 by June 30,
2007.
Pursuant to the terms of the addendum to the option agreement, we are still
required to retain the services of Rio Minerals Ltd. to perform all exploration
and/or development of the work on the Property. Due to Rio Minerals'
unavailability in 2004, by mutual agreement between us and Rio Minerals we will
commence our next work program in the spring of 2005.
To date we have performed approximately $31,785 of the work program in respect
of our required exploration expenses. We will acquire a 100% interest in the
Property, without any further action by any party, immediately upon the last of
the foregoing payments and exploration expenses having been met. However, we are
obligated to pay Cadre a net smelter return royalty (the "Royalty") equal to 2%
of the net smelter returns realized from production on the Property. If we fail
to meet any of the obligations in the agreement, Cadre will be entitled to
terminate our option. Of the $25,0000 required to be paid on or before December
31, 2002, only $11,943 of the payment was made by us due to actual exploration
expenses being less than estimated. The terms of the Spring Lake property option
agreement entitle the optionor to cancel the option in the event that a payment
is not made in a timely manner, unless the optionor waives such right in
writing. In this instance, Cadre waived in writing its right to terminate the
agreement in respect of the lesser amount paid.
We will use proceeds in this offering to make our initial exploration
expenditures. To earn our interest, however, we are required to make
expenditures beyond the amounts raised in this offering. We are required to make
expenditures of over $350,000 in respect of our property by mid 2007. If we
discover economic mineralization or other mineralised material during our
initial exploration expenditures, we will then go on to develop the property.
All expenditures made in respect of our development efforts will satisfy our
expenditure obligations in respect of the property. In the event that we are
unsuccessful in discovering economic mineralization or mineralised material
during our initial exploration, we will need to raise additional financing to
continue with explorations. In the event that we are unable to raise more
financing to continue our obligations, or decide do not to do so as a result of
poor results during our initial explorations, we will lose our interest in our
property. If we lose our interest in our property we will have to acquire
another property and raise financing in respect of it. If we are unable to do
so, we will go out of business and you will lose your investment.
Our current property consists of five claims which total approximately 1605
acres. The property is located approximately 20km Northeast of 100 Mile House in
south central British Columbia, Canada. The area lies within a portion of the
Quesnel trough, an Upper Triassic-Jurassic volcanic island arc sequence. A
strong subcircular aeromagnetic anomaly exists west of Spring Lake and has been
the focus of exploration in the area.
Expenditures to date on the property by previous owners of $245,466.56 were made
on geologica1, geochemical, geophysical and widely spaced diamond drilling
programs during 1994 and 1995. However, no exploration has taken place to the
south or west of the property grid. We confirm that the $245,466 expenditures
were made by parties unrelated to our company or management.
To date we have performed a total of $31,785 in initial exploration work on our
property. The work was completed by Rio Minerals Ltd. which included line
cutting, grid surveying as well as limited geochemical soil and silt samples. No
work permits are required at this time, until more advanced stages of
exploration occur (i.e. drilling). We are presently in the exploration stage and
there is no assurance that a commercially viable mineral deposit, a reserve,
exists in our property until further exploration is done and a comprehensive
evaluation concludes economic and legal feasibility. We have not obtained any
insurance in respect of the property.
We do not intend to interest other companies in the property if we find
mineralized materials. We intend to try to develop the reserves ourselves.
We have expended no money on development since our inception on July 3, 2002. We
have expended a total of $31,785 in initial exploration of the property.
There is no direct or indirect affiliation between our company, Andrew Molnar,
Cadre or Rio Minerals Ltd.
The following information is provided in compliance with "Guide 7 of Industry
Guides Under the Securities Act and the Exchange Act" for issuers engaged or to
be engaged in significant mining operations.
Glossary of Terms
The following are the definitions of some of the highly technical and geological
terms which follow below.
Andesite: A type of rock that typically formed through the relatively rapid
crystallization of a lava. Andesite was named after the Andes Mountains of South
America.
Assay: A chemical test performed on a sample of ores or minerals to determine
the amount of valuable metals contained.
Basalt: A type of rock composed chiefly of calcic plagioclase and clinopyroxene,
although nepheline, olivine, orthopyroxene, or quartz may be present. Basalt is
the fine-grained equivalent of gabbro. Basalts typically have low viscosity and
therefore occur in lava flows.
Breccia/Brecciation: a rock type, formed from recrystallised fragments of other
rocks.
Clast: Rock fragments formed in a sequence of sedimentary rocks.
Development: Work carried out for the purpose of opening up a mineral deposit
and making the actual ore extraction possible.
Diamond Drill: A rotary type of rock drill that cuts a core of rock that is
recovered in long cylindrical sections, two centimeters or more in diameter.
Diorite: An intrusive igneous rock.
Exploration: Work involved in searching for ore, usually by drilling or driving
a drift.
Gabbro: A coarse-grained, dark, igneous rock.
Geophysical Survey: Indirect methods of investigating the subsurface geology
using the applications of physics including electric, gravimetric, magnetic,
electromagnetic, seismic, and radiometric principles.
Glaciolacustrine deposit: a deposit in a glacial lake.
Grade: The average assay of a ton of ore, reflecting metal content.
Hornblende: an important rock-forming mineral made chiefly of silicates of
magnesium, calcium and iron, black in color.
Mineralization: The presence of economic minerals in a specific area or
geological formation.
Net Smelter Return: A share of the net revenues generated from the sale of metal
produced by a mine.
Porphyry: Any igneous rock in which relatively large crystals, called
phenocrysts, are set in a fine-grained groundness.
Reclamation: The restoration of a site after mining or exploration activity is
completed.
Reserves: That part of a mineral deposit which could be economically and legally
extracted or produced at the time of the reserve determination.
Skarn: Name for the metamorphic rocks surrounding an igneous intrusive where it
comes in contact with a limestone or dolomite formation.
Triassic: the earliest of the three geologic periods comprised in the Mesozoic
era.
Tertiary: the earlier of the two geologic periods in the Cenozoic era
Vein: A mineralized zone having a more or less regular development in length,
width and depth which clearly separates it from neighboring rock.
Location and Access
(1) The property consists of five claims totaling approximately 1605 acres. The
property is located approximately 12 kilometers east of the junction between
B.C. Highway 97 North and the 111 mile creek road, approximately 20 kilometers
north of 100 Mile House, B.C., and 6 kilometers south of Lac La Hache, B.C.
Williams Lake, B.C., is approximately 120 kilometers northwest of the property
and is the nearest large town. The property is located in the southern Cariboo,
within the Clinton Mining Division. The approximate coordinates are: latitude;
51(degree) 47`N, longitude; 121(degree) 15`W. The property is accessible by
approximately 12 kilometers of all-weather gravel road east of Highway 97 north.
Access through the property is via previously established logging roads and
spurs. Highway 97, a B.C. Rail line, natural gas and power transmission line run
through Lac La Hache. Twenty kilometers south of the property is the town of 100
Mile House, population 5,000.
The following are small scale maps showing the location and access to the
property, which consists of the claims located in the very center of the map.
[Graphic Omitted]
Physiography
The property is situated within the Central Plateau of the Cariboo region of
south central British Columbia. The area is characterized by gentle hills with
elevations ranging from 850 to 1500 meters. Approximately 40% of the fir, spruce
and pine forest in the immediate area has been clearcut and replanted. Several
large lakes and numerous creeks provide water year-round. The claims lie between
Spring Lake and Chub Lake. The annual precipitation is from 500 to 1000
millimeters, with most of it occurring during the winter months. Winter snow
cover averages one meter, arriving by early November and departing by April.
(2) Pursuant to an option agreement between us and Cadre, we have an option to
acquire an undivided 100% interest the claims if we expend certain amounts of
money on exploration.
In July 2002, we entered into the option agreement with Cadre to acquire an
undivided 100% interest in the Summer Claims 1-5 located in Lac La Hache,
British Columbia, Canada. We paid $10,000 to Cadre upon execution of the option
agreement. We were required to pay the following additional amounts to Cadre in
respect of the agreement: $10,000 on or before November 31, 2003; $25,000 on or
before November 31, 2004; $25,000 on or before November 31, 2005; and $30,000 on
or before November 31, 2006. Pursuant to the terms of the option agreement we
must retain the services of Rio Minerals Ltd. to perform all development work,
if any, on the Property. We were also required to expend the following amounts
on the exploration and development, if any, of the Property: a cumulative total
of not less than $25,000 on or before December 31, 2002; a cumulative total of
not less than $35,000 on or before December 31, 2003; a cumulative total of not
less than $150,000 on or before December 31, 2004; and a cumulative total of not
less than $500,000 on or before December 31, 2005.
On March 11, 2004, we amended the above-mentioned option agreement with Cadre.
Pursuant to the amended option agreement, we are not obligated to make
additional amounts to Cadre. However, we are still required to expend the
following amounts on the exploration and development of the Property: a
cumulative total of not less than $25,000 by June 30, 2005; a cumulative total
of not less than $75,000 by June 30, 2006; a cumulative total of not less than
$250,000 by June 30, 2007. We are still required to retain the services of Rio
Minerals Ltd. to perform all development work, if any, on the Property. Due to
Rio Minerals' unavailability and weather conditions beyond our control, we will
begin our next work program in the spring of 2005.
To date we have performed approximately $31,785 of the exploration work program
in respect of our required exploration expenses. We will acquire a 100% interest
in the Property, without any further action by any party, immediately upon the
last of the foregoing payments and exploration expenses having been met.
However, we are obligated to pay Cadre a net smelter return royalty (the
"Royalty") equal to 2% of the net smelter returns realized from production on
the Property. If we fail to meet any of the obligations in the agreement, Cadre
will be entitled to terminate our option. Of the $25,0000 required to be paid on
or before December 31, 2002, only $11,943 of the payment was made by us due to
actual exploration expenses being less than estimated. The terms of the Spring
Lake property option agreement entitle the optionor to cancel the option in the
event that a payment is not made in a timely manner, unless the optionor waives
such right in writing. In this instance, Cadre waived in writing its right to
terminate the agreement in respect of the lesser amount paid.
(3) The Lac La Hache area was initially prospected for placer gold during the
Cariboo Gold Rush in the 1890`s. In 1966, the Canadian federal and B.C.
provincial government performed an airborne magnetic survey of the Lac La Hache
area which resulted in the delineation of several magnetic anomalies. This was
followed by exploration for porphyry and skarn mineralization. In 1969 and 1970,
geological, geochemical and geophysical work was performed on the Spring Lake
area by Royal Canadian Ventures Ltd. (Vollo, 1969/1970). In 1982 and 1983,
geochemical and limited induced polarization surveys were performed in the
Spring Lake and Chub Lake area by Guichon Explorco Limited for Selco Inc.
(Owsiacki, Gamble, 1982, 1983). Local copper anomalies were encountered north of
Kelly Lake, and between Spring Lake and Chub Lake where thick glacial till and
possible lake bottom deposits occur.
(4) Geological, geochemical, geophysical and diamond drilling programs were
performed on the property during 1994 and early 1995. In early 1994, two road
reconnaissance induced polarization lines through the property from east to west
indicated anomalous chargeability west of Kelly Lake, B.C. Seven (7) lines of
standard grid and soil geochemical sampling of the C-horizon was performed in
the area of chargeability. Remnants of lines and stations from work performed in
1982 were tied in. Five diamond drillholes were conducted in 1994 to determine
the source of a combined geophysical, geochemical anomaly. Cut grid lines,
induced polarization and magnetic surveys were then performed (Vissor, 1994
report for G.W.R. Resources), and followed by drilling of 8 holes in early 1995.
We have just commenced our initial explorations of the property.
A power transmission line run through Lac La Hache which is accessible from our
property. We will utilize this source of power during our explorations.
Slopes on the property are very steep throughout. Vegetation consists mainly of
fir and pine trees, much of it mature second growth. The climate features warm
summers and cold winters. The Harrison Forrest is very wet in the winter and
fairly dry in the summer. Average yearly precipitation is thirty inches. A snow
pack of six to nine feet begins to accumulate in October and lingers in places
into May. The recommended field exploration season is from early May to late
October, although the close proximity to access roads would allow for drilling
or underground exploration and development on a year round basis.
Property Geology
The property is underlain by Upper Triassic-Jurassic volcanic-sedimentary
breccias of andesite-basalt composition, and subvolcanic hornblende-feldspar
porphyry flows, dikes or sills of basalt-andesite or monzodiorite composition.
The northwestern portion of the property is underlain by a volcanic-sedimentary
breccia containing limestone clasts. This unit fonns a prominent easterly
trending ridge. Gabbro-diorite occurs near the 1994 IP baseline, and medium
grained feldspar porphyritic monzodiorite-diorite occurs in drillholes. Near
Kelly Lake, relatively fresh to weakly chloritic biotite-hornblende granodiorite
outcrops. Intrusive brecciation occurs near the contact between the gabbro and
the granodiorite north of Kelly Lake, and between the gabbro and monzodiorite
west of Kelly Lake. Fresh to weakly propylitic very fine grained, amygdaloidal,
vessicular plagioclase porphyritic basalt dikes are associated with
quartz-carbonate-clay altered fault zones cutting older rocks. Flat-lying,
fresh, hematitic Tertiary mafic porphyry flows over the older rocks
unconformably.
The property is extensively covered by glacial, and glaciolacustrine deposits
reaching over100 meters in depth, however, depth appears to vary erratically.
Air photo interpretation and regional magnetics suggest the property is
generally within a northwesterly structural fabric, and a VLF-EM survey carried
out by Royal Canadian Ventures Ltd. indicate northeast to east-west structures
occur (Vollo, 1969/70). Fine grained, banded volcanic tuff appear to dip gently
in drillhole S94-2 and 4. Limestone and sedimentary clasts in the northwest
corner of the property appear to have relatively flat-lying orientations.
Magnetometer surveys over the 1994 I.P. grid indicate a +3,000 Nt (relative)
magnetic anomaly occurs at the east end of the volcanic-sedimentary breccia,
northwest of Spring Lake. Mapping indicates northerly trending faults cut the
volcanic-sedimentary breccia west of the mag anomaly. Moderate to strong
fracturing and faulting occurs near the contact between various intrusive and
volcanic rocks. A northerly trending contact between gabbro/diorite and
granodiorite north of Kelly Lake occurs. Fracture orientations are dominantly
subvertical with subordinate subhorizontal jointing and tension fractures.
We have not determined if there is any economic mineralization on the property
nor whether there is other mineralization of any economic significance. We will
not be able to make such determination until completion of this offering (please
see "Our Proposed Exploration Program").
We have obtained a geologist or mining engineer's report on the property from
one of our directors, Derrick Strickland. The report and the consent of Mr.
Strickland are attached as exhibits to this registration statement.
Previous Exploration
Geological, geochemical, geophysical and diamond drilling programs were
performed on the property during 1994 and early 1995. In early 1994, two road
reconnaissance induced polarization lines through the property from east to west
indicated anomalous chargeability west of Kelly Lake, B.C. Seven (7) lines of
standard grid and soil geochemical sampling (-60# preparation) of the C-horizon
was performed in the area of chargeability. Remnants of lines and stations from
Selco's work in 1982 were tied in. Elevated copper values (mean + 1 standard
deviation) are based on Selco's extensive surveys of the region in 1982/83
(Gamblc, D., 1982, figure 5). Five diamond drillholes were conducted in 1994 to
determine the source of a combined geophysical, geochemical anomaly. Cut grid
lines, induced polarization and magnetic surveys were then performed (Vissor,
1994 report for G.W.R. Resources), and followed by drilling of 8 holes in early
1995.
Previous exploration programs have left areas to the south and west of the
property grid virtually unexplored for mineral potential.
Our Proposed Initial Exploration Program
We must conduct initial explorations to determine what amount of valuable
minerals, if any, exist on our properties and if any valuable minerals that are
found can be economically extracted and profitably processed. Our exploration
targets are any valuable minerals, and specifically we will look for economic
mineralization, silver, copper and zinc.
Our initial exploration program is designed to economically explore and evaluate
our properties. Any proceeds we raise in this offering will be applied to pay
our offering expenses, then for initial exploration expenses, and then for
development, if our exploration indicates that development is warranted.
We do not claim to have any valuable minerals or reserves whatsoever at this
time on any of our properties.
We intend to implement an exploration program and intend to proceed in the
following three phases all of which will be performed or supervised by Derrick
Strickland, one of our directors, and independent contractors hired by us. We
may hire a professional geologist as an independent contractor to assist Mr.
Strickland. We will not hire anyone to start exploration until we receive funds
from this offering to start exploring for economic mineralization. We believe
that the only equipment we will need to start exploration on the property will
be a backhoe. We will lease the backhoe from and equipment rental or hire an
independent contractor who owns a backhoe to the dig the trenches we refer to in
this prospectus. We expect to have to pay $30,000 for a backhoe or $25.00 an
hour for an independent contractor who owns his own backhoe.
The only equipment we will need is a backhoe to dig trenches. It is not possible
to allocate specific dollar amounts to specific acts because we do not know what
it will encounter during our trenching. As trenches are dug and we evaluate the
results, we will determine if valuable mineralized material exists. Mineralized
material is a mineralized body that has been delineated by appropriately spaced
drilling and/or underground sampling to support a sufficient tonnage and average
grade of metals. If valuable mineralized material is found, we will then
determined if it is profitable to extract the economic mineralization. If we
determine that it is possible to extract the mineralized material, the
exploration the property will cease and we will initiate the development stage
of the property. The proceeds from the offering will not be used for
development. We have not formulated a plan for development, and cannot and will
not to so until valuable mineralized material is found.
Phase 1 of our initial explorations will consist of geological mapping and
sampling of the property to determine rock types, alteration and mineralization.
We will also undertake soil geochemistry using 240 micron fraction over existing
cut lines, and new lines to the south and north. We will also conduct
polarization and magnetic surveys.
The geologic mapping on the property will be done by taking soil samples
throughout the property at approximately 200-300 foot intervals. On areas with
no rock outcrops, we will do soil survey grids. We will also analyze surface
outcrops of rock and the topography of the property to assist in the geologic
mapping. We anticipate the costs of the geologic mapping during this Phase to be
approximately $8,000.
We will also conduct geochemical testing during Phase 1. Rock samples will be
taken from the property and taken to a lab where a determination of the
elemental make up of the sample and the exact concentrations of economic
mineralization, silver, copper and zinc will be made. We will then compare the
relative concentrations of economic mineralization, silver, copper and zinc in
samples so the results from different samples can be compared in a more precise
manner and plotted on a map to evaluate their significance. We anticipate the
cost of geochemical testing to be approximately $8,000 to $12,000.
When available, existing workings, like trenches, prospect pits, shafts or
tunnels will be examined. If an apparent mineralized zone is identified and
narrowed down to a specific area by the studies, we will begin trenching the
area. Trenches are generally approximately 150 ft. in length and 10-20 ft. wide.
These dimensions allow for a thorough examination of the surface of the vein
structure types generally encountered in the area. They also allow easier
restoration of the land to its pre-exploration condition when we conclude our
operations. Once excavation of a trench is completed, samples are taken and then
analyzed for economically potential valuable minerals that are known to have
occurred in the area. We will analyze trench samples at a lab in Vancouver,
British Columbia. Rock chip samples will tested for traces of economic
mineralization, silver, lead, copper, zinc, iron, and other valuable minerals;
however our primary focus is the search for economic mineralization, silver,
copper or zinc. A careful interpretation of this available data collected from
the various tests aid in determining whether or not the prospect has current
economic potential and whether further exploration is warranted.
We estimate that Phase 1 will take about 3 months and cost up to $20,000.
Phase 2 involves an initial examination of the underground characteristics of
any vein structure that was identified by Phase 1 of exploration. Phase 2 is
aimed at identifying any mineral deposits of potential economic importance. The
methods employed are
-- More extensive trenching
-- More advanced geophysical work
-- Diamond drilling
Diamond drilling is an essential component of exploration and aids in the
delineation and definition of any deposits. The geophysical work gives a general
understanding of the location and extent of mineralization at depths that are
unreachable by surface excavations and provides a target for more extensive
trenching and core drilling. We anticipate the approximate cost of the
geophysical work to be approximately $5,000, and the approximate cost of
drilling, if completed, to be $5,000 to $8,000.
Trenching identifies the continuity and extent of mineralization, if any, below
the surface. If trenching reveals significant mineralization, we may conduct
limited diamond drilling to further explore the deposit. We anticipate that we
will rely primarily on more extensive trenching during Phase 2 to identify the
extent of mineralization. We anticipate the cost of the trenching during Phase 2
to be approximately $8,000.
After a thorough analysis of the data collected in Phase 2, we will decide
whether to proceed with a Phase 3 study or to continue more Phase 2
explorations.
Phase 2 will take about 3 months and cost up to $20,000.
Phase 3 is aimed at precisely defining the depth, the width, the length, the
tonnage and the value per ton of any mineral body. This is accomplished through
extensive drift driving. Drift driving is the process of constructing a tunnel
to take samples of minerals for testing. Later, the tunnel can be used for
mining minerals. The costs of underground work are variable and depend in large
part on the type of rock encountered. If the rock is unstable and fractured, the
cost of tunneling can increase greatly because the tunnel must be reinforced. If
the rock is tombstone or granite the cost of tunneling is lower as reinforcement
of the tunnel is not necessary. We do not intend to conduct extensive drift
driving until Phase 3. We anticipate driving a drift of approximately 50 to 60
feet during Phase 3, at an approximate cost of $1,000 per foot, for a total cost
of between $50,000 and $60,000.
Phase 3 will take about 6 months and cost up to $90,000.
In order for us to initiate underground work during Phase 3, we will take into
account several factors before we make the decision to go underground. We will
consider the density of the underlying rock in deciding the extent of the drift
driving to be undertaken. If the rock encountered is tombstone or granite we are
more likely to proceed with more extensive drift driving as the cost of
construction is lower than if the rock is unstable and/or fractured. The primary
factor we will take into account in deciding whether to proceed with extensive
drift driving will be the grade and consistency of the ore encountered. That is
to say, our estimate of the amount of economic mineralization or other valuable
mineral per ton in the underlying rock will determine the extent of our
underground work.
We do not intend to interest other companies in the property if we find
mineralized materials. We intend to try to develop the reserves ourselves.
The three phases of exploration will be conducted by a qualified geologist with
reasonable experience in exploration of economic mineralization and mineral
properties. The exploration will be supervised by Derrick Strickland, a member
of our Board of Directors. Mr. Strickland will also be involved extensively in
assisting with the geologic mapping and geochemical testing. See "Background of
Officers and Directors".
In the event that our initial exploration program is successful and we discover
mineralized material, we will then continue with development expenditures in
respect of our property. We will require additional financing to commence our
development. We are required to spend a cumulative total of over $800,000 in
respect of our property by the end of 2005. Development expenditures will
satisfy our expenditure obligations. In the event that our initial exploration
program is unsuccessful and we do not find any mineralized material, we will
have to decide whether to continue with or cease our exploration efforts. We
will require additional financing if we decide to continue with development
efforts in respect of the property. If we decide not to pursue further
exploration of the property we will lose our interest. We will have to find
another property to explore and to do so we will require additional financing.
We may be unable to raise such additional financing. If we are unable to raise
financing we will go out of business and you will lose your entire investment.
Competitive Factors
The economic mineralization mining industry is fragmented. We compete with other
exploration companies looking for economic mineralization. We are one of the
smallest exploration companies in existence. We are an infinitely small
participant in the economic mineralization mining market. While we compete with
other exploration companies, there is no competition for the exploration or
removal or mineral from out property. Readily available economic mineralization
markets exist in Canada and around the world for the sale of economic
mineralization. Therefore, we will likely be able to sell any economic
mineralization that we are able to recover.
Regulations
Our mineral exploration program is subject to the Mineral Tenure Act (British
Columbia) and Regulation. This act sets forth rules for
-- Locating claims
-- Posting claims
-- Working claims
-- Reporting work performed
We are also subject to the British Columbia Mineral Exploration Code (the
"Code") that tells us how and where we can explore for valuable minerals. We
must comply with these laws to operate our business. The purpose of the Code is
to assist persons who wish to explore for valuable minerals in British Columbia
to understand the process whereby exploration activities are permitted and
regulated. The Code establishes province wide standards for mineral exploration
and development activities. The Code also manages and administers exploration
and development activities to ensure maximum extraction with a minimum of
environmental disturbance. The Code does not apply to certain exploration work
we will be conducting. Specifically, work that does not involve mechanical
disturbance of the surface including:
-- Prospecting using hand-held tools
-- Geological and geochemical surveying
-- Airborne geophysical surveying
-- Hand-trenching without the use of explosives
-- The establishment of gridlines that do not require the felling of trees
Exploration activities that we intend on carrying out which are subject to
the provisions of the Code are as follows:
-- Drilling, trenching and excavating using machinery
--Disturbance of the ground by mechanical means
-- Blasting
Compliance with these rules and regulations will require us to meet the minimum
annual work requirements. Also, prior to proceeding with any exploration work
subject to the Code we must apply for a notice of work permit. In this notice we
will be required to set out the location, nature, extent and duration of the
proposed exploration activities. The notice is submitted to the British Columbia
Regional Office of the Mines Branch, Energy Division. We have not yet applied
for this permit, since it is not required until later stages of exploration
(i.e. drilling). We estimate that the fees for obtaining such permit are very
nominal and that it can be obtained within 2 weeks.
In order to explore for economic mineralization on our property we must submit
the plan contained in this prospectus for review and pay a fee of $150.00. We
believe that the plan as contained in this prospectus will be accepted and an
exploration permit will be issued to us. The exploration permit is the only
permit or license we will need to explore for economic mineralization on our
property.
Environmental Law
We are also subject to the Health, Safety and Reclamation Code for Mines in
British Columbia. This code deals with environmental matters relating to the
exploration and development of exploration properties exploration properties.
The goal of this Act is to protect the environment through a series of
regulations affecting:
1.Health and Safety
2.Archaeological Sites
3.Exploration Access
We are responsible to provide a safe working environment, to not disrupt
archaeological sites, and to conduct our activities to prevent unnecessary
damage to the property.
We anticipate no discharge of water into active stream, creek, river, lake or
any other body of water regulated by environmental law or regulation. No
endangered species will be disturbed. Restoration of the disturbed land will be
completed according to law. All holes, pits and shafts will be sealed upon
abandonment of the property. It is difficult to estimate the cost of compliance
with the environmental law since the full nature and extent of our proposed
activities cannot be determined until we start our operations and know what that
will involve from an environmental standpoint. We do not expect costs associated
with compliance with environmental laws to be significant, so long as the
exploration is properly conducted within generally accepted standards. In the
event that such costs are higher than we anticipate we may need to raise
additional financing. We have not arranged for such financing, nor is there any
guarantee that we would be able to secure it. If we are unable to pay costs
associated with compliance with environmental laws this could significantly harm
our business.
We are currently in compliance with the act and will continue to comply with the
act in the future. We believe that compliance with the act will not adversely
affect our business operations in the future.
Employees
Initially, we intend to use the services of subcontractors for manual labor
exploration work on our properties. Our only technical employee will be Derrick
P. Strickland, one of our directors.
Employees and Employment Agreements
At present, we have no employees, other than Mr. Bebek, who has received a total
compensation for his services of $7,500 to date. Mr. Bebek does not have an
employment agreement with us. We presently do not have pension, health, annuity,
insurance, stock options, profit sharing or similar benefit plans; however, we
may adopt plans in the future. There are presently no personal benefits
available to any employees.
We intend to hire geologists, engineers and excavation subcontractors on an as
needed basis. We have not entered into any negotiations or contracts with any of
them. We do not intend to initiate negotiations or hire anyone until we receive
proceeds from our offering.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION OR PLAN OF OPERATIONS
We are a start-up, exploration stage company and have not yet generated or
realized any revenues from our business operations.
To meet our need for cash we are attempting to raise money from this offering.
There is no assurance that we will be able to raise enough money through this
offering to stay in business. Whatever money we do raise, will be applied first
to offering expenses, then exploration and then to development, if development
is warranted. If we do not raise all of the money we need from this offering, we
will have to find alternative sources, like a second public offering, a private
placement of securities, or loans from our officers or others. We have discussed
this matter with our officers, however, our officers are unwilling to make any
commitment to loan us any more money at this time. At the present time, we have
not made any arrangements to raise additional cash, other than through this
offering. If we need additional cash and cannot raise it we will either have to
suspend operations until we do raise the cash, or cease operations entirely.
Even if we raise all the money we need from this offering for our initial
exploration program, we will be required to raise additional financing. We are
required to make a total of $350,000 in expenditures in respect of our property
by the end of the year 2006. To date we have expended a total of only about
$41,785 (including the $10,000 we paid to acquire the option). This amount
includes a total of $31,785 exploration expenditures to date. The work was
completed by Rio Minerals Ltd. which included line cutting, grid surveying as
well as limited geochemical soil and silt samples. Rio Minerals Ltd. completed
the portion of the exploration for which we paid $11,943 by December 31, 2002.
We will be conducting research in connection with the exploration of our
property. We are not going to buy or sell any plant or significant equipment. We
do not expect a change in our number of employees.
Limited Operating History; Need for
Additional Capital There is no historical financial information about our
company upon which to base an evaluation of our performance. We are an
exploration stage company and have not generated any revenues from operations.
We may not be successful in our business operations. Our business is subject to
risks inherent in the establishment of a new business enterprise, including
limited capital resources, possible delays in the exploration of our properties,
and possible cost overruns due to price and cost increases in services.
We are seeking equity financing pursuant to this offering to provide for the
capital required to implement our research and initial exploration phases.
We have no assurance that future financing will be available to us on acceptable
terms. If financing is not available on satisfactory terms, we may be unable to
continue, develop or expand our operations. Current and future equity financing
could result in additional dilution to existing shareholders. We will require
additional financing beyond this offering.
Plan of Operation
Over the next twelve months, we intend to complete the research and initial
exploration stage of our mining operations on our first and only property. We
obtained our interest in our property by entering into an option agreement with
Cadre Capital to acquire an undivided 100% interest in a mineral property in
British Columbia, Canada. We paid $10,000 to Cadre upon execution of the option
agreement. In order to earn our 100% interest, we are required to expend more
than $350,000 in respect of our property by the end of 2007. The financing from
this offering will be used to pay for our initial program of exploration. If our
initial exploration program is successful, we intend to proceed with development
of our property. Expenditures made in respect of development will satisfy our
obligations in respect of our property. If our initial program of exploration is
unsuccessful we will either continue with or cease our explorations, depending
upon our results. We will require additional financing beyond this offering
whether or not we continue with explorations or commence development of our
property. We have not made any arrangements in respect of such financing.
If we raise the maximum of $200,000 in this offering, we believe that we can pay
our offering expenses and satisfy our cash requirements without having to raise
additional funds in the next twelve months. If we raise less than $200,000 we
may have to raise additional financing or we may not be able to continue our
proposed business operations. Until completion of this offering, we believe that
our president and director, Michael Bebek, may contribute funds to pay for our
expenses because of his significant equity ownership in us. However, Mr. Bebek
is not obligated to pay our expenses and he may be unable to do so. Our belief
that Mr. Bebek will pay our expenses is based on the fact that he owns 3,000,000
shares of our common stock. We believe Mr. Bebek may continue to pay our
expenses as long as he maintains an ownership of our common stock.
We do not expect to purchase or sell any plant or significant equipment. We
intend to lease any equipment, such as a backhoe, that we need to carry out our
exploration operations.
We do not expect to increase our number of employees during the next twelve
months. We intend to retain the services of independent contractors, on an "as
needed basis", to carry out our exploration program. Liquidity and Capital
Resources
Cash Balances
We maintain our major cash balance at one financial institution, Bank of
Montreal, located at First Bank Tower, 595 Burrard Street, Vancouver, British
Columbia, Canada. The balances are insured up to CAD$60,000 per account by the
Canada Deposit Insurance Corporation. As at October 5, 2004, we had a cash
balance of approximately $16,488. At October 5, 2004, there were no uninsured
cash balances.
Fiscal Year Ended August 31, 2004
Operating expenses from inception to period ended August 31, 2004, totaled
$77,221 and we experienced a net loss of $(85,658), against no revenue.
The earnings per share (fully diluted - weighted average) was a net loss of
$(0.01) from inception to the period ended August 31, 2004.
As of the date of this registration statement, we have not generated any
revenues from our proposed business operations.
We issued 3,000,000 shares of common stock through a Section 4(2) offering in
July 2002. This was accounted for by an advance of $3,000. Mr. Bebek has loaned
as a total of $88,301 to date. Mr. Bebek intends to loan us small amounts of
money, as needed, to pay organizational and start-up costs and operating
capital. The loans bear an imputed interest at the rate of 8% per annum. There
are no documents that will reflect the loans and the loans will not be due on a
specific date. Mr. Bebek will accept repayment from us when money is available.
Even if the maximum amount is raised, we do not intend to repay the amount he
loans us from the proceeds of this offering.
As of August 31, 2004, our total assets were $780 and our total liabilities were
$75,001.
MANAGEMENT
Officers and Directors
Each of our directors is elected by the stockholders to a term of one year and
serves until his or her successor is elected and qualified. Each of our officers
is elected by the board of directors to a term of one year and serves until his
or her successor is duly elected and qualified, or until he or she is removed
from office. The board of directors has no nominating, auditing or compensation
committees.
The names, addresses, ages and positions of our present officers and directors
are set forth below:
Name and Address Age Positions
---------------- --- ---------
Michael Bebek
700 West Pender Street President, Secretary,
Suite 1204 Treasurer and a member of the
Vancouver, B.C. V6C 1G8 30 Board of Directors
Derrick Strickland
1707 Charles Street, #208
Vancouver, B.C. V5N 2T7 31 Member of the Board of Directors
The persons named above have held their offices/positions since inception of our
company and are expected to hold their offices/positions until the next annual
meeting of our stockholders.
Background of Officers and Directors
Michael Bebek has been our President, Secretary, Treasurer and a member of our
board of directors since inception. Mr. Bebek has devoted approximately 50% of
his professional time to our business since inception and intends to continue to
devote this amount of time in the future.
From 2001 to present Mr. Bebek has worked as a Computer Consultant for
Liquor Distributors of British Columbia, the provincial liquor
distribution authority.
Throughout 2001 Mr. Bebek was a Computer Consultant for 360 Networks Inc.,
a communications infrastructure provider.
Throughout 2000 Mr. Bebek was a Junior Network Administrator for
InterLogic Engineering Ltd., a software development and design company.
From 1999 to 2000 Mr. Bebek was an Instructor for CCI Learning Inc., a
developer and supplier of computer training products.
From 1997 to 1999 Mr. Bebek was a server at Earl's Restaurant.
From 1994 to 1997 Mr. Bebek majored in Business Administration and Minored
in Computer Science at the University of Northern British Columbia, Prince
George, B.C., Canada.
In 2000 Mr. Bebek obtained a Diploma in Computer Network Administration
from the CDI College of Business and Technology, Vancouver, B.C., Canada.
Derrick Strickland has been a member of our board of directors since inception.
Mr. Strickland has devoted approximately 5% of his professional time to our
business since inception and intends to continue to devote this amount of time
in the future.
2001 to present Mr. Strickland has worked as an independent geological
consultant.
From 2000 to 2001 Mr. Strickland was completing his Master of Business
Administration from University of Phoenix.
From 1993 to 2000 Mr. Strickland was an Acting Senior
Mineralogist/Geologist for Ashton Mining of Canada Inc., in Vancouver,
British Columbia.
-- Project management: budgets, technical and administrative staff.
Including heavy mineral sampling and exploration drilling
-- Evaluating diamond potential of Kimberlites
-- Development of various analytical research projects, from proposals to
presentation of findings, typically research in glacial geology and
kimberlite indicators.
-- Designing, implementation and maintenance of information systems;
database and graphical interface, evaluation of new software packages.
-- Evaluation of business proposals: including negotiating and preparing
of contracts.
-- Investor Relations: promotion through brochures, public displays,
advertising, networking with customer base, and attending trade shows.
-- Training of personnel in complex scientific methods ranging from modern
research to computer applications.
-- Undertaking special projects ranging from data collection to
statistical analysis and interpretations, i.e. analysis of ISO 9000
accreditation, including research and documentation of findings.
Throughout 1993 Mr. Stickland was a Geologist for RESA Resources Inc. in
Bellchasse, Quebec
-- Conducted detailed and Reconnaissance geological and geochemical
surveys. In the Eastern Townships of Quebec.
-- Diamond Drilling on the Bellchasse Economic mineralization deposit.
-- Creation of an information management system for land and technical
issues.
From 1991 to 1993 Mr. Strickland was a Laboratory Supervisor/Teaching
Assistant at Concordia University, Montreal, Quebec
-- Development of information tracking systems: for geochemical samples.
-- Ensured safe laboratory practices.
-- Training of personnel; in laboratory practices and the use of computer
system.
-- Teaching of the laboratory portion of introductory classes.
From 1990 to 1992 Mr. Strickland was a Research Assistant for McGill
University, Montreal, Quebec
-- Assisting in various industries sponsored research studies.
-- Preparations of various media for analytical work.
In 1992 Mr. Strickland was a Junior Geologist/Field Assistant for the
Geological Survey of Canada, in Red Lake, Ontario.
-- Collection of glacial till samples and other field duties for tungsten
exploration
In 1991 Mr. Strickland was a Field/Lab Technician for the New Brunswick
Department of Natural Resources, in Fredericton, New Brunswick.
-- Geotechnical, geochemical, and technical lab duties.
From 1986 to 1988 Mr. Strickland was a Field Assistant for RESA Resources
Inc., in Bellchase Quebec.
-- Conducted detailed and Reconnaissance geological and geochemical
surveys.
-- Economic mineralization Panning, geotechnical office duties on the
Bellchase Deposit in Quebec
In 2001 Mr. Strickland obtained his Master of Business Administration from
University of Phoenix
In 1997 Mr. Strickland completed the CSC Canadian Securities Course
In 1993 Mr. Strickland obtained his Bachelor of Science in Geology from
Concordia University, Quebec.
Conflicts of Interest
We believe that the only conflicts of interest to which Messrs. Strickland and
Bebek may be subject to are in the devotion of time to other exploration
projects that do not involve us.
EXECUTIVE COMPENSATION
Mr. Bebek, our sole officer and Messrs. Strickland and Bebek, our directors, may
receive very limited compensation for their services as our officers. To date
Mr. Bebek has received $7,500, and Mr. Strickland has received $1,500. There
are, however, no plans to compensate them regularly in the near future, unless
and until we begin to realize revenues and become profitable in our business
operations.
Messrs. Bebek and Strickland have not accrued compensation for past services,
nor do they intend to do so for future services.
Option/SAR Grants
The company does not currently have a stock option plan. No individual grants of
stock options, whether or not in tandem with stock appreciation rights known as
SARs and freestanding SARs have been made to any executive officer or any
director since our inception, accordingly, no stock options have been exercised
by any of the officers or directors since we were founded.
Long-Term Incentive Plan Awards
We do not have any long-term incentive plans that provide compensation intended
to serve as incentive for performance.
Compensation of Directors
The members of the Board of Directors are not compensated by us for acting as
such.
Indemnification
Under our Articles of Incorporation and Bylaws, we may indemnify an officer or
director who is made a party to any proceeding, including a lawsuit, because of
his position, if he acted in good faith and in a manner he reasonably believed
to be in our best interest. We may advance expenses incurred in defending a
proceeding. To the extent that the officer or director is successful on the
merits in a proceeding as to which he is to be indemnified, we must indemnify
him against all expenses incurred, including attorney's fees. With respect to a
derivative action, indemnity may be made only for expenses actually and
reasonably incurred in defending the proceeding, and if the officer or director
is judged liable, only by a court order. The indemnification is intended to be
to the fullest extent permitted by the laws of the State of Nevada.
Regarding indemnification for liabilities arising under the Securities Act of
1933, which may be permitted to directors or officers under Nevada law, we are
informed that, in the opinion of the Securities and Exchange Commission,
indemnification is against public policy, as expressed in the Act and is,
therefore, unenforceable.
PRINCIPAL STOCKHOLDERS
The following table sets forth, as of the date of this prospectus, the total
number of shares owned beneficially by each of our directors, officers and key
employees, individually and as a group, and the present owners of 5% or more of
our total outstanding shares. The table also reflects what their ownership will
be assuming completion of the sale of all shares in this offering. The
stockholder listed below has direct ownership of his shares and possesses sole
voting and dispositive power with respect to the shares.
Title of Name and Address of Amount and Nature Percentage of
Class Beneficial Owner [1] of Beneficial Ownership Class
----- -------------------- ----------------------- -----
Common Michael Bebek 3,000,000 100%
Shares 700 West Pender Street,
Suite 1204
Vancouver, B.C. V6C 1G8
[1] The person(s) named above may be deemed to be a parent and promoter of our
company by virtue of his/its direct and indirect stock holdings. Messrs.
Strickland and Bebek are the only promoters of our company.
Future Sales by Existing Stockholders
A total of 3,000,000 shares of common stock were issued to the existing
stockholders, all of which are restricted securities, as defined in Rule 144 of
the Rules and Regulations of the SEC promulgated under the Securities Act. Under
Rule 144, the shares can be publicly sold, subject to volume restrictions and
restrictions on the manner of sale, commencing one year after their acquisition.
Shares purchased in this offering, which will be immediately resalable, and
sales of all of our other shares after applicable restrictions expire, could
have a depressive effect on the market price, if any, of our common stock and
the shares we are offering.
DESCRIPTION OF SECURITIES
Common Stock
Our authorized capital stock consists of 25,000,000 shares of common stock, par
value $0.001 per share. The following are the all of the material terms that
apply to our holders of our common stock:
They have equal ratable rights to dividends from funds legally available
if and when declared by our board of directors;
They are entitled to share ratably in all of our assets available for
distribution to holders of common stock upon liquidation, dissolution or
winding up of our affairs;
They do not have preemptive, subscription or conversion rights and there
are no redemption or sinking fund provisions or rights; and
They are entitled to one non-cumulative vote per share on all matters on
which stockholders may vote.
Our legal counsel, Trimble Tate Nulan Evans & Holden, P.C., are of the opinion
that all shares of common stock now outstanding are fully paid for and
non-assessable and all shares of common stock which are the subject of this
offering, when issued, will be fully paid for and non-assessable. We refer you
to our Articles of Incorporation, Bylaws and the applicable statutes of the
State of Nevada for a more complete description of the rights and liabilities of
holders of our securities. We also refer you to the opinion of our legal
counsel, Trimble Tate Nulan Evans & Holden, P.C. attached hereto as Exhibit
5.1.4.
Non-cumulative Voting
Holders of shares of our common stock do not have cumulative voting rights,
which means that the holders of more than 50% of the outstanding shares, voting
for the election of directors, can elect all of the directors to be elected, if
they so choose, and, in that event, the holders of the remaining shares will not
be able to elect any of our directors. After this offering is completed, the
present stockholders will own approximately 60% of our outstanding shares.
Cash Dividends
As of the date of this prospectus, we have not paid any cash dividends to
stockholders. The declaration of any future cash dividend will be at the
discretion of our board of directors and will depend upon our earnings, if any,
our capital requirements and financial position, our general economic
conditions, and other pertinent conditions. It is our present intention not to
pay any cash dividends in the foreseeable future, but rather to reinvest
earnings, if any, in our business operations.
Reports
After we complete this offering, we will not be required to furnish you with an
annual report. Further, we will not voluntarily send you an annual report. We
will be required to file reports with the SEC Regulation 15D of the Securities
Exchange Act.. The reports will be filed electronically. The reports we will be
required to file are Forms 10-KSB, 10-QSB, and 8-K. You may read copies of any
materials we file with the SEC at the SEC's Public Reference Room at 450 Fifth
Street, N.W., Washington, DC 20549. You may obtain information on the operation
of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also
maintains an Internet site that will contain copies of the reports we file
electronically. The address for the Internet site is www.sec.gov.
Our duty to file reports under Regulation 15D of the Securities Exchange
Act.shall be automatically suspended to any fiscal year, other than the fiscal
year within which such registration statement became effective, if, at the
beginning of such fiscal year, the securities of each class to which the
registration statement relates are held of record by less than three hundred
persons Stock Transfer Agent We have not yet appointed a stock transfer agent
for our securities. We intend to appoint a stock transfer agent before
effectiveness of this prospectus.
CERTAIN TRANSACTIONS
On July 23, 2002, we issued a total of 3,000,000 shares of restricted common
stock to Mr. Bebek, our president and a director of our company. This was
accounted for as cash advances of $3,000. To date, Mr. Bebek has loaned us a
total of approximately $88,301, at an imputed rate of interest of 8% per annum.
Mr. Bebek intends to continue to advance small loans to us to be used for
organizational and start-up costs and operating capital until this offering is
completed. Although the loans do not bear interest, we have imputed a rate of 8%
interest and have not been advanced as of the date hereof. There will be no
documents reflecting the loans and they will not be due on a specific date. Mr.
Bebek will accept repayment from us when money is available. We do not plan to
repay the loans from the proceeds of this offering even if we raise the maximum
amount.
LITIGATION
We are not a party to any pending litigation and none is contemplated or
threatened.
EXPERTS
Our financial statements for the period from inception to August 31, 2004,
included in this prospectus have been prepared by an independent accountant, and
reviewed and audited by Lopez, Blevins, Bork & Associates, LLP. Our unaudited
financial statement for the fiscal quarter ended May 31, 2004 was reviewed by
Lopez, Blevins, Bork & Associates, LLP. The auditors from Lopez, Blevins, Bork &
Associates, LLP are the same auditors which performed the audit of our financial
statements from inception to August 31, 2003, but at the time, they were with
the firm of Malone & Bailey, PLLC. Most recently, they have formed the firm of
Lopez, Blevins, Bork & Associates, LLP.
LEGAL MATTERS
In September 2004, we decided to engage new legal counsel. Our Board of
Directors approved the change in legal counsel to Trimble Tate Nulan Evans &
Holden, P.C. on September 3, 2004. The validity of the common stock offered
hereby and certain legal matters have been passed on by Trimble Tate Nulan Evans
& Holden, P.C. of Denver, Colorado. In the past, certain legal matters were
passed on by Sutton Lawrence LLP, of Reno, Nevada.
FINANCIAL STATEMENTS
Our fiscal year end is August 31. Our financial statements were prepared by an
independent accountant, and reviewed by an Independent Auditor, for the years
ended August 31, 2004 and August 31, 2003 as well as our unaudited financial
statement for the fiscal quarter ended May 31, 2004 which immediately follow.
F-1
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Enwin Resources, Inc.
(A Development Stage Company)
Vancouver BC, Canada
We have audited the accompanying balance sheet of Enwin Resources, Inc. as of
August 31, 2004, and the related statements of operations, stockholder's
deficit, and cash flows for each of the two years then ended and for the period
from July 3, 2002 (Inception) through August 31, 2004. 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 the standards of the Public Company
Accounting Oversight Board (United States). 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
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Enwin Resources, Inc. as of
August 31, 2004, and the results of its operations and its cash flows for each
of the two years then ended and for the period from July 3, 2002 (Inception)
through August 31, 2004, in conformity with accounting principles generally
accepted in the United States of America.
The accompanying financial statements have been prepared assuming that Enwin
will continue as a going concern. As discussed in Note 2 to the financial
statements, Enwin has incurred losses from form inception through August 31,
2004 totaling $85,658. Enwin will require additional working capital to develop
its business until Enwin either (1) achieves a level of revenues adequate to
generate sufficient cash flows from operations; or (2) obtains additional
financing necessary to support its working capital requirements. These
conditions raise substantial doubt about Enwin's ability to continue as a going
concern. Management's plans in regard to this matter are also described in Note
2. The accompanying financial statements do not include any adjustments that
might result from the outcome of these uncertainties.
Lopez, Blevins, Bork & Associates, LLP
Houston, Texas October 4, 2004
F-2
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
August 31,
2004
ASSETS
Current assets
Cash $ 780
--------
LIABILITIES AND STOCKHOLDER'S DEFICIT
Accounts payable and accrued expenses 6,700
Stockholder advances 68,301
--------
75,001
Commitments
STOCKHOLDER'S DEFICIT:
Common stock, $.001 par value, 25,000,000 shares authorized,
3,000,000 shares issued and outstanding 3,000
Additional paid in capital 8,437
Deficit accumulated during the development stage (85,658)
--------
Total Stockholder's Deficit (74,221)
--------
TOTAL LIABILITIES AND STOCKHOLDER'S DEFICIT $ 780
========
F-3
See accompanying summary of accounting policies and notes to financial
statements.
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
Inception
Year Ended Year Ended through
August 31, August 31, August 31,
2004 2003 2004
--------- --------- --------
General and administrative:
Professional fees $ 6,700 $ 2,320 $ 21,020
Impairment -- -- 10,000
Compensation 1,500 7,000 9,000
Exploration costs 18,855 12,900 31,785
Other 168 5,260 5,416
--------- --------- --------
27,223 27,480 77,221
Interest expense 5,184 3,253 8,437
--------- --------- --------
Net loss $ (32,407) $ (30,733) $(85,658)
========= ========= ========
Net loss per share:
Basic and diluted $ (0.01) $ (0.01)
========= =========
Weighted average shares outstanding:
Basic and diluted 3,000,000 3,000,000
========= =========
F-4
See accompanying summary of accounting policies and notes to financial
statements.
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF STOCKHOLDER'S DEFICIT
Period from July 3, 2002 (Inception) through August 31, 2004
Deficit
accumulated
Common stock Additional during the
------------ paid-in development
Shares Amount capital stage Total
------ ------ ------- ----- -----
Issuance of common
stock for cash
to founders 3,000,000 $3,000 $ -- $ -- $ 3,000
Net loss -- -- -- (22,518) (22,518)
--------- ------ ------ -------- --------
Balance,
August 31, 2002 3,000,000 3,000 -- (22,518) (19,518)
Imputed interest -- -- 3,253 -- 3,253
Net loss -- -- -- (30,733) (30,733)
--------- ------ ------ -------- --------
Balance,
August 31, 2003 3,000,000 3,000 -- (53,251) (46,998)
Imputed interest -- -- 5,184 -- 5,184
Net loss -- -- -- (32,407) (32,407)
--------- ------ ------ -------- --------
Balance,
August 31, 2004 3,000,000 $3,000 $8,437 $(85,658) $(74,221)
========= ====== ====== ======== ========
F-5
See accompanying summary of accounting policies and notes to financial
statements.
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
Inception
Year Ended Year Ended through
August 31, August 31, August 31,
2004 2003 2004
---- ---- ----
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss $(32,407) $(30,733) $(85,658)
Adjustments to reconcile
net deficit to cash used by
operating activities:
Imputed interest on
stockholder Advances 5,184 3,253 8,437
Impairment -- -- 10,000
-------- -------- --------
CASH FLOWS USED IN OPERATING
ACTIVITIES (27,223) (27,480) (67,221)
-------- -------- --------
CASH FLOWS FROM INVESTING
ACTIVITIES -- -- --
-------- -------- --------
Payment on option to acquire
mining interest in property -- -- (10,000)
-------- -------- --------
CASHFLOWS FROM FINANCING
ACTIVITIES
Proceeds from sale of
common stock -- -- 3,000
Stockholder advances 14,000 27,275 68,301
-------- -------- --------
CASH FLOWS PROVIDED BY FINANCING
ACTIVITIES 14,000 27,275 71,301
-------- -------- --------
NET INCREASE (DECREASE) IN CASH (6,523) (205) 780
Cash, beginning of period 7,303 7,508 --
-------- -------- --------
Cash, end of period $ 780 $ 7,303 $ 780
======== ======== ========
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid $ -- $ -- $ --
Income taxes paid $ -- $ -- $ --
F-6
See accompanying summary of accounting policies and notes to financial
statements.
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF ACCOUNTING POLICIES
Nature of business. Enwin Resources, Inc. ("Enwin") was incorporated in Nevada
on July 3, 2002. Enwin is a development stage company with no current business
operations. Enwin is currently in the process of acquiring certain mining
claims.
Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the balance sheet. Actual results could differ from
those estimates.
Basic Loss Per Share
Basic loss per share has been calculated based on the weighted average number of
shares of common stock outstanding during the period. Recent Accounting
Pronouncements Enwin does not expect the adoption of recently issued accounting
pronouncements to have a significant impact on the Company's results of
operations, financial position or cash flow.
NOTE 2 - GOING CONCERN
Enwin has recurring losses and has a deficit accumulated during the exploration
stage of $85,658 as of August 31, 2004. Enwin's financial statements are
prepared using the generally accepted accounting principles applicable to a
going concern, which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. However, Enwin has no current
source of revenue. Without realization of additional capital, it would be
unlikely for Enwin to continue as a going concern. Enwin's management plans on
raising cash from public or private debt or equity financing, on an as needed
basis and in the longer term, revenues from the acquisition, exploration and
development of mineral interests, if found. Enwin's ability to continue as a
going concern is dependent on these additional cash financings, and, ultimately,
upon achieving profitable operations through the development of mineral
interests.
NOTE 3 - RECLASSIFICATION
Certain reclassifications have been made among the expenses of the Company in
fiscal 2003. The reclassifications had no effect on net income.
F-7
NOTE 4 - INCOME TAXES
For the years ended August 31, 2004 and 2003, Enwin has incurred net losses and,
therefore, has no tax liability. The net deferred tax asset generated by the
loss carry-forward has been fully reserved. The cumulative net operating loss
carry-forward is approximately $86,000 at August 31, 2004, and will expire in
the years 2022 through 2024.
Deferred income taxes consist of the following at August 31:
2004
----
Long-term:
Deferred tax assets $ 29,000
---------
Valuation allowance (29,000)
=========
NOTE 5 - COMMON STOCK
At inception, Enwin issued 3,000,000 shares of stock to its founding shareholder
for $3,000 cash.
NOTE 6 - RELATED PARTY TRANSACTIONS
A stockholder of Enwin has advances due from Enwin of $68,301 at August 31,
2004. The advances are non-interest bearing and are due upon demand. Enwin has
imputed interest at 8% or $5,184 for the year ended August 31, 2004.
The same shareholder has agreed to advance Enwin monies until an offering is
completed.
In September 2004, the same stockholder made an additional advance of $20,000.
Enwin neither owns nor leases any real or personal property, an officer has
provided office services without charge. Such costs are immaterial to the
financial statements and accordingly are not reflected herein. The officers and
directors are involved in other business activities and most likely will become
involved in other business activities in the future.
NOTE 7 - COMMITMENTS
During the year ended August 31, 2004, Enwin amended an option agreement dated
July 25, 2002 with Cadre Capital regarding the Summer Property located in
British Columbia, Canada.
In order for Enwin to earn the option, it must conduct an exploration
work-program on the property totaling of $25,000 by June 30, 2005, $75,000 by
June 30, 2006 and $250,000 by June 30, 2007. In addition, Enwin must maintain
all property maintenance fees and payments in order to keep the property in good
standing with applicable mining laws governing the property.
F-8
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
May 31, 2004 August 31, 2003
(unaudited)
ASSETS
Current assets
Cash $ 811 $ 7,303
LIABILITIES AND STOCKHOLDERS' DEFICIT
Accounts payable and accrued liabilities $ 4,300 $ --
--------- ---------
Shareholder advances 68,301 54,301
--------- ---------
72,601 54,301
--------- ---------
Commitments
STOCKHOLDERS' DEFICIT:
Common stock, $.001 par value, 25,000,000
shares authorized, 3,000,000 shares issued
and outstanding 3,000 3,000
Additional paid in capital 7,071 3,253
Deficit accumulated during the development stage (81,861) (53,251)
--------- ---------
Total Stockholders' Deficit (71,790) (46,998)
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDER'S DEFICIT $ 811 $ 7,303
========= =========
F-9
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
Three months ended Nine months ended Inception
May 31, May 31, through
------- ------- May 31,
2004 2003 2004 2003 2004
---- ---- ---- ---- ----
General and administrative:
Professional fees $ 4,300 $ -- $ 4,300 $ 2,320 $ 18,620
Impairment -- -- -- -- 10,000
Compensation -- -- 1,500 6,000 9,000
Interest 1,366 -- 3,818 -- 7,071
Exploration costs -- -- 18,855 12,900 31,755
Other 24 454 137 1,270 5,415
Net loss $ (5,690) $ (454) $ (28,610) $ (22,490) $ (81,861)
========== ========== =========== =========== ===========
Net loss per share:
Basic and diluted $ (0.00) $ (0.00) $ (0.01) $ (0.01)
========== ========== =========== ===========
Weighted average
sharesoutstanding:
Basic and diluted 3,000,000 3,000,000 3,000,000 3,000,000
========== ========== =========== ===========
F-10
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
Nine Months Ended May 31, 2004 and 2003
and Period From July 3, 2002 (Inception) through May 31, 2004
(Unaudited)
Inception
through
May 31,
2004 2003 2004
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(28,610) $(22,490) $(81,861)
Adjustments to reconcile net
deficit to cash used by
operating activities:
Imputed interest on
stockholder advances 3,818 -- 7,071
Impairment -- -- 10,000
Change in non-cash working capital item
Accounts payable and accrued liabilities (4,300) -- 4,300
------- -------- --------
CASH FLOWS USED IN OPERATING ACTIVITIES (20,492) (22,490) (60,490)
------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Payment on option to acquire mining
interest in property -- -- (10,000)
------- -------- --------
CASHFLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of common stock -- -- 3,000
Shareholder advances 14,000 15,000 68,301
------- -------- --------
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES 14,000 15,000 71,301
NET INCREASE (DECREASE) IN CASH (6,492) (7,490) 811
Cash, beginning of period 7,303 7,508 --
------- -------- --------
Cash, end of period $ 811 $ 18 $ 811
======= ======== ========
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid $ -- $ -- $ --
======= ======== ========
Income taxes paid $ -- $ -- $ --
======= ======== ========
F-11
ENWIN RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited interim financial statements of Enwin Resources, Inc.
have been prepared in accordance with accounting principles generally accepted
in the United States of America and the rules of the Securities and Exchange
Commission ("SEC"), and should be read in conjunction with the audited financial
statements and notes thereto contained in the Company's registration statement
filed with the SEC on Form SB-2. In the opinion of management, all adjustments,
consisting of normal recurring adjustments, necessary for a fair presentation of
financial position and the results of operations for the interim periods
presented have been reflected herein. The results of operations for interim
periods are not necessarily indicative of the results to be expected for the
full year. Notes to the financial statements which would substantially duplicate
the disclosure contained in the audited financial statements for the most recent
fiscal year 2003 as reported in Form SB-2, have been omitted.
NOTE 2 - RECLASSIFICATION
Certain reclassifications have been made among the expenses of the Company in
fiscal 2003. The reclassifications had no effect on net income.
NOTE 3 - COMMITMENTS
During the period, the company amended an option agreement dated July 25, 2002
with Cadre Capital regarding the Summer Property located in British Columbia,
Canada.
In order for the Company to earn the option, it must conduct an exploration
work-program on the property totaling no less than $ 25,000 by June 30, 2005, $
75,000 by June 30, 2006 and $250,000 by June 30, 2007. In addition the Company
must maintain all property maintenance fees and payments in order to keep the
property in good standing with applicable mining laws governing the property.
F-12
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The only statute, charter provision, bylaw, contract, or other arrangement under
which any controlling person, director or officer of the Registrant is insured
or indemnified in any manner against any liability which he may incur in his
capacity as such, is as follows:
1. Article XII of the Articles of Incorporation of the company, filed as
Exhibit 3.1 to the Registration Statement.
2. Article XI of the Bylaws of the company, filed as Exhibit 3.2 to the
Registration Statement.
3. Nevada Revised Statutes, Chapter 78.
The general effect of the foregoing is to indemnify a control person, officer or
director from liability, thereby making the company responsible for any expenses
or damages incurred by such control person, officer or director in any action
brought against them based on their conduct in such capacity, provided they did
not engage in fraud or criminal activity.
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses of the offering (assuming all shares are sold), all of
which are to be paid by the registrant, are as follows:
SEC Registration Fee $ 100.00
Printing Expenses 6,500.00
Accounting Fees and Expenses 10,000.00
Legal Fees and Expenses 20,000.00
Federal Taxes 0.00
State Taxes 0.00
Engineering 5,000.00
Blue Sky Fees/Expenses 5,000.00
Transfer Agent Fees 3,000.00
Miscellaneous Expense 400.00
----------
TOTAL $ $50,000.00
==========
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.
During the past three years, the Registrant has sold the following securities
which were not registered under the Securities Act of 1933, as amended.
Name and Address Date Shares Consideration
---------------- ---- ------ -------------
Michael Bebek
700 West Pender Street
Suite 1204
Vancouver, B.C. V6C 1G8 07/23/02 3,000,000 Advances totaling $3,000.
II-1
We issued the foregoing restricted shares of common stock to Mr. Bebek under
Section 4(2) of the Securities Act of 1933. Mr. Bebek is a sophisticated
investor, an officer and director of the company, and was in possession of all
material information relating to the company. Further, no commissions were paid
to anyone in connection with the sale of the shares and no general solicitation
was made.
ITEM 27. EXHIBITS.
The following Exhibits are filed as part of this Registration Statement,
pursuant to Item 601 of Regulation S-B. All Exhibits have been previously filed
unless otherwise noted.
Exhibit No. Document Description
----------- --------------------
*3.1 Articles of Incorporation
*3.2 Bylaws
*4.1 Specimen Stock Certificate.
*5.1 Opinion of Sutton Lawrence LLP, regarding the legality
of the Securities being registered.
**5.1.1 Opinion of Sutton Lawrence LLP, regarding the legality
of the Securities being registered.
***5.1.2 Opinion of Sutton Lawrence LLP, regarding the legality
of the Securities being registered.
****5.1.3 Opinion of Sutton Lawrence LLP, regarding the legality
of the Securities being registered.
5.1.4 Opinion of Trimble Tate Nulan Evans & Holden, P.C.
regarding the legality of the Securities being
registered
*10.1 Option Agreement
10.2 Option Agreement Amendment
*23.1 Consent of Malone & Bailey, PLLC
**23.1.1 Consent of Malone & Bailey, PLLC
***23.1.2 Consent of Malone & Bailey, PLLC
****23.1.3 Consent of Malone & Bailey, PLLC
23.1.4 Consent of Lopez, Blevins, Bork & Associates, LLP
*23.2 Consent of Sutton Lawrence LLP (included in Exhibit
5.1)
*23.3 Consent of Derrick Strickland, Geologist
23.4 Consent of Trimble Tate Nulan Evans & Holden, P.C.
(included in Exhibit 5.1.4)
*99.1 Subscription Agreement.
*99.2 Opinion of Derrick Strickland, Geologist
****99.3 Waiver of Cadre Capital
* Previously filed with our Registration Statement on Form SB-2, filed
October 18, 2002.
** Previously filed with our Registration Statement on Form SB-2, filed
December 16, 2002.
*** Previously filed with our Registration Statement on Form SB-2, filed March
28, 2003.
**** Previously filed with our Registration Statement on Form SB-2, filed
September 4, 2003.
ITEM 28. UNDERTAKINGS.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "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 the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-2
The undersigned registrant hereby undertakes:
1. Tofile, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
a. To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
b. To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement;
c. To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any change to such information in the registration statement.
2. That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing of this Form SB-2 Registration Statement and has duly
caused this Form SB-2 Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Vancouver, Canada on this 15th day of
October, 2004.
ENWIN RESOURCES INC.
BY:
--------------------------------------
Michael Bebek
President, Secretary, Treasurer
and a member of the Board of Directors
--------------------------------------
KNOW ALL MEN BY THESE PRESENT, that each person whose signature appears below
constitutes and appoints Michael Bebek, as true and lawful attorney-in-fact and
agent, with full power of substitution, for his and in his name, place and
stead, in any and all capacities, to sign any and all amendment (including
post-effective amendments) to this registration statement, and to file the same,
therewith, with the Securities and Exchange Commission, and to make any and all
state securities law or blue sky filings, granting unto said attorney-in-fact
and agent, full power and authority to do and perform each and every act and
thing requisite or necessary to be done in about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying the
confirming all that said attorney-in-fact and agent, or any substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
III-3
Pursuant to the requirements of the Securities Act of 1933, this Form SB-2
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title Date
- --------- ----- ----
Michael P. Bebek President, Principal Executive
Officer, Secretary, Treasurer,
Principal Accounting Officer
and member of Board of Directors October 15, 2004
Derrick Strickland Member of Board of Directors October 15, 2004
II-4