1
As filed with the Securities Registration No.
and Exchange Commission on ____________________________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
ZEOLITE MINING CORPORATION
(Name of small business issuer in its charter)
Nevada 1081 N/A
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(State or Other (Primary Standard (IRS Employer
Jurisdiction of Industrial Identification #)
Organization) Classification Code)
ZEOLITE MINING CORPORATION Conrad C. Lysiak, Esq.
2272 West Seventh Avenue 601 West First Avenue, Suite 503
Suite 318 Spokane, Washington 99201
Vancouver, British Columbia (509) 624-1475
Canada V6K 1Y2
(604) 731-7040
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(Address and telephone of (Name, address and telephone
registrant's executive office) 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. [ ]
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CALCULATION OF REGISTRATION FEE
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Aggregate
Securities Amount To Be Offering Price Offering Registration
To Be Registered Registered Per Share Price Fee [1]
Common Stock: 2,000,000 Shares $0.10 $200,000 $ 100.00
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[1] Estimated solely for purposes of calculating the registration fee
under Rule 457(c).
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.
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Prospectus
ZEOLITE MINING CORPORATION
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. 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.
Investing in our common stock involves risks. See "Risk Factors"
starting at page 6.
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Price Aggregate Proceeds
Per Share Offering Price to Us
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Common Stock $0.10 $200,000 $150,000
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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's illegal
to tell you otherwise.
The date of this prospectus is ________________________.
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TABLE OF CONTENTS
Page No.
Summary of Prospectus . . . . . . . 5
Risk Factors . . . . . . . . . 6
Risks Associated with Our Company . . . . 6
Risks Associated with this Offering . . . . 8
Use of Proceeds . . . . . . . . 9
Determination of Offering Price . . . . . 10
Capitalization . . . . . . . . . 11
Dilution of the Price You Pay for Your Shares . . . 12
Plan of Distribution; Terms of the Offering . . . 14
Business . . . . . . . . . . 17
Management's Discussion and Analysis of
Financial Condition and Results of Operations. . . 21
Management . . . . . . . . . . 23
Executive Compensation . . . . . . . 25
Principal Shareholders . . . . . . . 26
Description of Securities . . . . . . . 27
Certain Transactions . . . . . . . 28
Litigation . . . . . . . . . . 29
Experts . . . . . . . . . . 29
Legal Matters . . . . . . . . . 29
Financial Statements . . . . . . . . 29
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SUMMARY OF OUR OFFERING
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This summary highlights important information about our business
and about this offering. Because it is a summary, it doesn't 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 own one property
consisting of two claims. We intend to explore for zeolites on our
property.
Our administrative office is located at 1160-1040 West Georgia
Street, Vancouver, British Columbia, Canada V6E 4H1 , telephone (604)
605-0885 and our registered statutory office is located at 5844 South
Pecos Road, Suite B, Las Vegas, Nevada 89120. Our fiscal year end is
June 30.
The Offering
Following is a brief summary of this offering:
Securities being offered . . . Up to 2,000,000 shares of
common stock, par value
$0.00001.
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.
Net proceeds to our company . . Approximately $150,000.
Use of proceeds . . . . We will use the proceeds to pay
for offering expenses,
research and exploration.
Number of shares outstanding
before the offering . . . 5,000,000
Number of shares outstanding
after the offering . . . 7,000,000
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RISK FACTORS
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Please consider the following risk factors before deciding to
invest in our common stock
Risks Associated with Our Company:
1. We expect losses to continue, and the failure to generate
revenues could cause us to go out of business.
We were incorporated on October 5, 2000 and we have not started
our proposed business operations or 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 $274,500. Our
ability to achieve and maintain profitability and positive cash flow is
dependent upon
* our ability to locate a profitable mineral property
* our ability to generate revenues
* our ability to reduce exploration stage 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 cannot
guarantee that we will be successful in generating revenues in the
future. Failure to generate revenues will cause us to go out of
business.
2. We are subject to risks inherent in the establishment of a
new business enterprise.
We are 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. If we are not able to address these events, should they
occur, we may have to curtail or suspend our operations.
3. We have no known mineral reserves and if cannot find any we
will have to cease operations.
We have no mineral reserves. If we do not find a mineral reserve
containing zeolite or if we cannot develop the mineral reserve, either
because we do not have money to do it or because it will not be
economically feasible to do it, we will have to cease operations an you
will loose your investment.
7
4. Weather interruptions in the province of British Columbia may
affect and delay our proposed exploration operations.
Our proposed exploration work can only be performed approximately
five to six months out of the year. This is because rain and snow
cause roads leading to our claims to be impassible during four months
of the year. When roads are impassible, we are unable to work and
generate income.
5. Because we are small and do not have much capital, we must
limit our exploration.
Because we are small and do not have much capital, we must limit
our exploration. There are other larger exploration companies that
could and probably would spend more time and money exploring our
property.
6. We will have to suspend our exploration plans if we do not
have access to all of the supplies and materials we need.
Competition and unforeseen limited sources of supplies in the
industry could result in occasional spot shortages of supplies, like
dynamite, and equipment like 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 locates 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.
7. We may not have enough money to complete our exploration .
We may not have enough money to complete the exploration of our
property. If it turns our that we have not raised enough money to
complete our exploration program, we will try to raise additional funds
from a second public offering, a private placement or loans. At the
present time, we have not made any plans to raise additional money and
there is no assurance that we would be able to raise additional money
in the future. In we need additional money and can't raise it, we will
have to suspend or cease operations.
8. Our officers and directors have conflicts of interest in that
they are officers and directors of other mining companies.
Our officers and directors have conflicts of interest in that they
are officers and directors of other mining companies. In the future, if
we decide to acquire a mining property which is also sought by one of
the companies which Mr. Brandys or Mr. Hopper are officers or
directors, a direct conflict of interest could result.
8
Risks Associated with This Offering:
9. Because we are a penny stock, you may not be able to resell
our shares.
Our common stock is defined as a "penny stock" under the
Securities and Exchange Act of 1934, and its rules. Because we are a
penny stock, you may be unable to resell our shares. This is because
the Exchange Act and the penny stock rules impose additional sales
practice and disclosure requirements on broker-dealers who sell our
securities to persons other than accredited investors. As a result,
fewer broker/dealers are willing to make a market in our stock.
10. After this offering, control of the company will remain with
Messrs. Brandys and Hopper which may inhibit a change of control.
Even if we sell all 2,000,000 shares of common stock in this
offering, Messrs. Brandys and Hopper will still own 5,000,000 shares
and will continue to control us. As a result, after completion of
this offering, regardless of the number of shares we sell, Messrs.
Brandys and Hopper will be able to elect all of our directors and
control our operations and your ability to cause a change in the course
of our operations is eliminated. Our articles of incorporation do not
provide for cumulative voting. Cumulative voting is a process that
allows a shareholder to multiply the number of shares he owns times the
number of directors to be elected. That number is the total votes a
person can cast for all of the directors. Those votes can be allocated
in any manner to the directors being elected. Cumulative voting, in
some cases, will allow a minority group to elect at least one director
to the board.
11. Messrs. Brandys and Hopper's control can have a depressive
effect on the market price of stock.
Because Messrs. Brandys and Hopper will control us after the
offering, regardless of the number of shares sold, the value
attributable to the right to vote is gone. This could result in a
reduction in the market value to the shares you own because of the
ineffective voting power.
13. Messrs. Brandys and Hopper will receive a substantial
benefit from your investment.
Messrs Brandys and Hopper, our only shareholders will receive a
substantial benefit from your investment. They are supplying the
property to be explored which is valued at $500, paid expenses of
$22,508, cash of $0 and a loan of $0 which has to be repaid. 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 loose your
investment while Messrs Brandys and Hopper will lose only approximately
$23,008.
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13. Because there is no public trading market for our common
stock, you may not be able to resell your shares.
There is currently no public trading market for our common stock.
Therefore there is no central place, like a 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. Therefore, you may not be able to resell your shares.
14. There is no minimum number of shares that must be sold and we
will not refund any funds to you.
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.
15. You may be investing in a company that does not have adequate
funds to conduct its operations.
Because there is no minimum number of shares that must be sold and
we will not refund any funds to you, it is possible that we may not
raise enough funds to conduct our operations. If that happens, you
will suffer a loss in the amount of your investment.
16. Sales of common by our officers and directors will likely
cause the market price for the common stock to drop.
A total of 5,000,000 shares of stock were issued to our two
officers and directors. They paid an average price of $0.055. They
will likely sell a portion of their stock if the market price goes
above $0.10. If they do sell there stock into the market, the sales
may cause the market price of the stock to drop.
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USE OF PROCEEDS
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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 offering expenses. We will use the net proceeds as
follows:
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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 $ 140,000
Working capital $ 0 $ 0 $ 0 $ 10,000
Exploration expenditures consist of consulting services, costs of
obtaining geologic literature, and costs of obtaining personal
interviews with geologists, mining engineers and others familiar with
the properties. Exploration expenditures also include the cost of
mapping, geophysical testing, geochemical testing, and digging
trenches, pits and tunnels. We are not going to spend any sums of
money or implement our exploration program until this offering is
completed.
Working capital is the cost related to operating our office. It
is comprised of expenses for telephone service, mail, stationary,
accounting, acquisition of office equipment and supplies, and the
salary of for one secretary, if needed.
We have allocated a wide range of money for exploration. That is
because we do not know how much will ultimately be needed for
exploration. If we are successful in immediately finding zeolite, we
will stop exploring and go on to develop the property. Costs of
exploring will then cease. On the other hand if we do not immediately
find zeolite, we will continue to explore for zeolite on the property.
If we have to continue to explore for zeolite, the costs of exploration
will increase.
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 judgement 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.
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DETERMINATION OF OFFERING PRICE
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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:
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* our lack 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.
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CAPITALIZATION
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The following table sets forth our capitalization at March 31,
2000, on a historical basis and as adjusted to reflect the sale of the
shares.
This table should be read in conjunction with the section
entitled, Management's Discussion and Analysis of Financial Condition
and Results of Operations our Financial Statements and Notes; and other
financial and operating data included elsewhere in this prospectus.
12/31/00 As Adjusted After Offering
Actual 25% 50% 75% 100%
Stockholder's Equity:
Common Stock: 100,000,000
shares authorized,
par value $0.00001
5,000,000 issued and
outstanding $ 50
5,500,000 issued and
outstanding $ 55
6,000,000 issued and
outstanding $ 60
6,500,000 issued and
outstanding $ 65
7,000,000 issued and
outstanding $ 70
Additional Paid-in
Capital $ 274,950 $ 274,945 $ 324,940 $ 374,935 $ 424,930
Deficit accumulated
during the
exploration stage $ (274,500) $ (274,500 $ (274,500) $ (274,500) $ (274,500)
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TOTAL STOCKHOLDERS'
EQUITY (deficit) $ 500 $ 500 $ 50,500 $ 100,500 $ 150,500
========== ========== ========== ========== ==========
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DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES
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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 October 31, 2000, the net tangible book value of our
shares of common stock was $500 or approximately NIL per share based
upon 5,000,000 shares outstanding.
Upon completion of this offering, in the event all of the shares
are sold, the net tangible book value of the 7,000,000 shares to be
outstanding will be $150,500, or approximately $0.02 per share. The
net tangible book value of the shares held by our existing
stockholders will be increased by $0.02 per share without any
additional investment on their part. You will incur an immediate
dilution from $0.10 per share to $0.02 per share.
Upon completion of this offering, in the event 75% of the shares
are sold, the net tangible book value of the 6,500,000 shares to be
outstanding will be $100,500, or approximately $0.015 per share. The
net tangible book value of the shares held by our existing
stockholders will be increased by $0.015 per share without any
additional investment on their part. You will incur an immediate
dilution from $0.10 per share to $0.015 per share.
Upon completion of this offering, in the event 50% of the shares
are sold, the net tangible book value of the 6,000,000 shares to be
outstanding will be $50,500, or approximately $0.01 per share. The
net tangible book value of the shares held by our existing
stockholders will be increased by $0.01 per share without any
additional investment on their part. You will incur an immediate
dilution from $0.10 per share to $0.01 per share.
Upon completion of this offering, in the event 25% of the shares
are sold, the net tangible book value of the 5,500,000 shares to be
outstanding will be $500, or 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.
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After completion of this offering, if 2,000,000 shares are sold,
you will own approximately 28.57% 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 71.43% of the total number of shares then outstanding,
for which they have made contributions of cash and/or services and/or
other assets, totaling $275,000, or approximately $0.055 per share.
After completion of this offering, if 1,500,000 shares are sold,
you will own approximately 23.08% 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 76.92% of the total number of shares then outstanding,
for which they have made contributions of cash and/or services and/or
other assets, totaling $275,000, or approximately $0.055 per share.
After completion of this offering, if 1,000,000 shares are sold,
you will own approximately 16.67% 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 83.33% of the total number of shares then outstanding,
for which they have made contributions of cash and/or services and/or
other assets, totaling $275,000, or approximately $0.055 per share.
After completion of this offering, if 500,000 shares are sold,
you will own approximately 9.09% 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 90.91% of the total number of shares then outstanding,
for which they have made contributions of cash and/or services and/or
other assets, totaling $275,000, or approximately $0.055 per share.
The following table compares the differences of your investment
in our shares with the investment of our existing stockholders.
Existing Stockholders
Price per share . . . . . . . $ 0.055
Net tangible book value per share before offering . $ NIL
Net tangible book value per share after offering $ 0.02
Increase to present stockholders in net tangible book
value per share after offering . . . . $ 0.02
Capital contributions . . . . . . $ 275,000
Number of shares outstanding before the offering 5,000,000
Number of shares after offering
held by existing stockholders . . . . 5,000,000
Percentage of ownership after offering . . . 71.43%
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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 . . . 28.57%
Purchasers of Shares in this Offering if 75% of Shares Sold
Price per share . . . . . . . $ 0.10
Dilution per share . . . . . . . $ 0.085
Capital contributions . . . . . . $ 150,000
Number of shares after offering held
by public investors . . . . . . 1,500,000
Percentage of ownership after offering . . . 23.08%
Purchasers of Shares in this Offering if 50% of Shares Sold
Price per share . . . . . . . $ 0.10
Dilution per share . . . . . . . $ 0.09
Capital contributions . . . . . . $ 100,000
Number of shares after offering held
by public investors . . . . . . 1,000,000
Percentage of ownership after offering . . . 16.67%
Purchasers of Shares in this Offering if 25% of Shares Sold
Price per share . . . . . . . $ 0.10
Dilution per share . . . . . . . $ 0.10
Capital contributions . . . . . . $ 50,000
Number of shares after offering held
by public investors . . . . . . 500,000
Percentage of ownership after offering . . . 9.09%
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PLAN OF DISTRIBUTION; TERMS OF THE OFFERING
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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. 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.
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There is no minimum number of shares that must be sold in this
offering. Any money we receive will be immediately appropriated by
us for the uses set forth in the Use of Proceeds section of this
prospectus. No funds will be placed in an escrow account during the
offering period and no money will be returned once the subscription
has been accepted by us.
We will sell the shares in this offering through Alan W.
Brandys, one of our officers and directors. Mr. Brandys will receive
no commission from the sale of any shares. Mr. Brandys 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 his 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) does 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. Brandys is not subject to disqualification, is not being
compensated, and is not associated with a broker-dealer. Mr.
Brandys is and will continue to be one of officers and 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. Brandys has not during the last twelve months and
will not in the next twelve months offer or sell securities for
another corporation.
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Only after our registration statement is declared effective by
the SEC, do we intend to advertise, through tombstones, and hold
investment meetings in various states where the offering will be
registered. We will not utilize 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.
Offering Period and Expiration Date
This offering will start on the date of this prospectus and
continue for a 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 "ZEOLITE MINING
CORPORATION."
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 monies 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.
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BUSINESS
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General
We were incorporated in the State of Nevada on September 2,
1999. We are engaged in the acquisition and exploration of mining
properties. We maintain our statutory registered agent's office at
5844 South Pecos Road, Suite B, Las Vegas, Nevada 89120 and our
business office is located at 2272 West Seventh Aveune, suite 318,
Vancouver, British Columbia, Canada V6K 1Y2. Our telephone number is
(604) 731-7040. Our offices are leased from an officer on a month to
month basis and our monthly rental is $0.
Background
In October 2000, Mr. Douglas Hopper, our Vice President,
Secretary, and a member of the board of directors and Mr. Nick
Wychopin, acquired one mineral property containing two mining claims
in British Columbia, Canada by arranging the staking of the same
through a third party. Messrs Hopper and Wychopin paid $500 to
stake the claims. The claims are recorded in Mr. Hopper's name to a
avoid paying additional fees, however, title to the claims has been
conveyed to us by an unrecorded deed. An unrecorded deed is one
which title to the property has been transferred to us, but the deed
has not been filed with the British Columbia office of records.
Title to the property is superior to all other unrecorded deeds.
Should Mr. Hopper transfer title to another person and that deed is
recorded before recording our deed, that person will have superior
title and we will have none. If that event occurs, however, Mr.
Hopper will be liable to us for monetary damages for breach of his
warranty of title. Under British Columbia provincial law, if the
deed is recorded in our name, we will have to pay a minimum of
$500.00 and file other documents since we are a foreign corporation
in Canada. We have decided that if zeolite is discovered on the
property and it is economical to remove the zeolite, we will record
the deed, pay the additional tax, and file as a foreign corporation.
We are in possession of the unrecorded deed and the decision to
record or not record the deed is solely within our province.
To date we have not performed any work on our property. 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.
18
Location and Access
Our property consists of two claims. The claims are located 2.5
miles northwest of the town of Princeton, British Columbia and covers
a portion of the western slopes of Mount Miner. Princeton is located
approximately 185 miles east of Vancouver, British Columbia on the
Southern TransProvincial Highway No. 3.
Access to the property from Princeton is via Highway 5A
northward to the Old Hedley Road then east approximately 550 yards to
the Dear Valley or Summerland Road. This road is taken for
approximately 5 miles northward and eastward to the western slope of
Mount Miner and the east-west claim line of the property.
Property geology
The major type of rock found on the property is volcanic.
Zeolites occur naturally in basic volcanic rocks as cavity filings,
probably as a result of deposition by fluids and vapors.
Zeolites in general
Zeolites are any member of a family of hydrated aluminosilicate
minerals that contain alkali and alkaline-earth metals. Zeolites are
noted for their ability toward ion-exchange and reversible
dehydration. Zeolites are used in the separation of hydrocarbons,
such as in petroleum refining; drying of gases and liquids; and,
pollution control by selective molecular absorption.
Our Proposed Exploration Program
We must conduct exploration to determine what amount of
minerals, if any, exist on our properties and if any minerals which
are found can be economically extracted and profitably processed.
Our exploration program is designed to economically explore and
evaluate our properties.
We do not claim to have any minerals or reserves whatsoever at
this time on any of our properties.
We intend to implement an exploration program and intend to
proceed in the following three phases:
Phase 1 will begin with research of the available geologic
literature, personal interviews with geologists, mining engineers and
others familiar with the prospect sites. We have recently begun this
phase of the exploration process on our properties.
19
When the research is completed, our initial work will be
augmented with geologic mapping, geophysical testing and geochemical
testing of our claims. When available, existing workings, like
trenches, prospect pits, shafts or tunnels will be examined. If an
apparent mineralized zone is identified and narrowed down to a
specific area by the studies, we will to begin trenching the area.
Trenches are generally approximately 150 feet in length and
10-20 feet wide. These dimensions allow for a thorough examination of
the surface of the vein structure types generally encountered in the
area. They also allow easier restoration of the land to its pre-
exploration condition when we conclude our operations. Once
excavation of a trench is completed, samples are taken and then
analyzed for economically potential minerals that are known to have
occurred in the area. Careful interpretation of this available data
collected from the various tests aid in determining whether or not
the prospect has current economic potential and whether further
exploration is warranted.
Phase 1 will take about 3 months and cost up to $20,000.
Phase 2 involves an initial examination of the underground
characteristics of the vein structure that was identified by Phase 1
of exploration. Phase 2 is aimed at identifying any mineral deposits
of potential economic importance. The methods employed are
* more extensive trenching
* more advanced geophysical work
* drift driving
Drift driving is the process of constructing a tunnel to take samples
of minerals for testing. Later, the tunnel can be used for mining
minerals . The geophysical work gives a general understanding of the
location and extent of mineralization at depths that are unreachable
by surface excavations and provides a target for more extensive
trenching and core drilling. Trenching identifies the continuity and
extent of mineralization, if any, below the surface. After a thorough
analysis of the data collected in Phase 2, we will decide if the
property warrants a Phase 3 study.
Phase 2 will take about 3 months and cost up to $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. Phase 3 will
take about 6 months and cost up to $80,000.
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.
20
Competitive Factors
The zeolite mining industry is fragmented. We compete with
other exploration companies looking for zeolites. We are one of the
smallest exploration companies in existence. We are an infinitely
small participant in the zeolite mining market. While we compete
with other exploration companies, there is no competition for the
exploration or removal or mineral from our property. Readily
available zeolite markets exist in Canada and around the world for
the sale of zeolites. Therefore, we will be able to sell any
zeolites that we are able to recover.
Regulations
Our mineral exploration program is subject to the Canadian
Mineral Tenure Act 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 which tells us how and where we can explore for minerals. We
must comply with these laws to operate our business. Compliance
with these rules and regulations will not adversely affect our
operations.
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 mining
properties. Its goals are 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, not
disrupt archaeological sites, and conduct our activities to prevent
unnecessary damage to the property.
We will secure all necessary permits for exploration and, if
development is warranted on the property, will file final plans of
operation before we start any mining operations. 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
21
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 are 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
employees will be Alan W. Brandys and Douglas H. Hopper, our officers
and directors.
Employees and Employment Agreements
At present, we have no employees, other than Messrs. Brandys and
Hopper, our officers and directors, who were compensated for their
services. Messrs. Brandys and Hopper do not have employment
agreements 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.
- --------------------------------------------------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
- --------------------------------------------------------------------
This section of the prospectus includes a number of forward-
looking statements that reflect our current views with respect to
future events and financial performance. Forward-looking statements
are often identified by words like: believe, expect, estimate,
anticipate, intend, project and similar expressions, or words which,
by their nature, refer to future events. You should not place undue
certainty on these forward-looking statements, which apply only as of
the date of this prospectus. These forward-looking states are
subject to certain risks and uncertainties that could cause actual
results to differ materially from historical results or out
predictions.
We are a start-up, exploration stage company and have not yet
generated or realized any revenues from our business operations.
Our auditors have issued a going concern opinion. This means
that our auditors believe there is doubt that we can continue as an
on-going business for the next twelve months unless we obtain
additional capital to pay our bills. This is because we have not
22
generated any revenues and no revenues are anticipated until we begin
removing and selling minerals. Accordingly, we must raise cash from
sources other than the sale of minerals found on our property. That
cash must be raised from other sources. Our only other source for
cash at this time is investments by others in our company. We must
raise cash to implement our project and stay in business.
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. What ever
money we do raise, will be applied first to 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 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 can't raise it we will either have to suspend
operations until we do raise the cash, or cease operations entirely.
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 cannot guarantee we will be successful in our business
operations. Our business is subject to risks inherent in the
establishment of a new business enterprise, including limited capital
resources, possible delays in the exploration of our properties, and
possible cost overruns due to price and cost increases in services.
To become profitable and competitive, we conduct into the
research and exploration of our properties before we start
production of any minerals we may find. We are seeking equity
financing to provide for the capital required to implement our
research and 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. Equity financing could result in additional dilution
to existing shareholders.
23
Results of Operations
From Inception on October 5, 2000.
We just recently acquired our first property and are commencing
the research and exploration stage of our mining operations on that
property at this time.
Since inception, we have used our common stock to raise money
for our property acquisition, for corporate expenses and to repay
outstanding indebtedness. Net cash provided by financing activities
from inception on October5, 2000 to December 31, 2000 was $0, as a
result of proceeds received from advances. In addition a related
party paid expenses in the amount of $23,008 directly to providers,
and payment of this amount was included in the original issuance of
stock.
Liquidity and Capital Resources
As of the date of this registration statement, we have yet to
generate any revenues from our business operations.
We issued 5,000,000 shares of common stock through a Section
4(2) offering in October 2000. This was accounted for as a
compensation expense of $251,992 and advances and reimbursement of
expenses of $23,008.
Since our inception, Messrs. Brandys and Hopper have paid
expenses for us in the total sum of $23,008, which included
organizational and start-up costs and operating capital.
As of December 31, 2000, our total assets were $500 and our
total liabilities were $0.
- --------------------------------------------------------------------
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.
24
The names, addresses, ages and positions of our present officers
and directors are set forth below:
Name and Address Age Positions
Alan W. Brandys 45 President, Treasurer, Principal
6211 Boundary Dr. West Accounting Officer and a member of
Unite 16 the Board of Directors
Surrey, B.C.
Canada V3X 3G7
Douglas Hopper 65 Vice President, Secretary and a
203 - 828 W. Hastings St. member of the Board of Directors
Vancouver, B.C.
Canada V6C 1C8
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
Alan W. Brandys has been our President, Treasurer, Principal
Accounting Officer and a member of our board of directors since
inception. Since 1994, Mr. Brandys has been self-employed as a
financial consultant. Since October 1997, Mr. Brandys has been a
Director of Canica Mineral Development Inc., a British Columbia
corporation located in Vancouver. Canica Mineral is engaged in the
business of exploration. From April 1994 to April 1998, Mr. Brandys
was a development consultant for Miranda Incorporated, an oil and gas
corporation located in Independence, Kansas. Mr. Brandys was a co-
founder and from March 1993 to May 1998 a director of Autotech
Protection Systems Inc. located in Edmonton, Alberta, Canada.
Autotech Protection was engaged in the business of car detailing for
new car dealers. From June 1988 to July 1990, Mr. Brandys was Vice
President and Marketing of Telesis Corporation Inc., Edmonton,
Alberta, Canada. Telesis Corporation was engaged in the business of
manufacturing environmental safe properties. From January 1983 to
April 1988, Mr. Brandys was Senior Stockbroker at First Commonwealth
Securities Corporation, Edmonton, Alberta, Canada. From January 1981
to January 1983 Mr. Brandys was Director of Technology at Caribou
Hydrocarbon Products Ltd., Vancouver, British Columbia. Caribou
Hydrocarbon Products was engaged in the extraction of byproducts from
wood chips. Mr. Brandys holds a Master of Business Administration
degree from the University of British Columbia and a Bachelor of
Science degee in biology from the University of British Columbia.
Douglas H. Hopper has been our Vice President, Secretary and a
member of our board of directors since inception. Since January
1995, Mr. Hopper has been prospecting for gold, plantenoids, copper
and zeolites.
25
Conflicts of Interest
We believe that Alan W. Brandys and Douglas H. Hopper will be
subject to conflicts of interest. The conflicts of interest arise
from Messrs. Brandys and Hopper's relationships with other mining
corporations. In the future, Messrs. Brandys and Hopper will continue
to be involved in the mining business for other entities and their
involvement could create conflicts of interest. At the present time,
we do not foresee a direct conflict of interest because we do not
intend to acquire any additional mining properties. The only
conflicts that we foresee are Messrs. Brandys and Hopper devotion of
time to mining projects that do not involve us.
Specifically, Alan W. Brandys is an independent consultant and a
director of Canica Mineral Development Inc.
- --------------------------------------------------------------------
EXECUTIVE COMPENSATION
- --------------------------------------------------------------------
Messrs. Brandys and Hopper, our officers and directors, were
compensated in shares of common stock in the amount of $251,992 for
their services and there are no plans to compensate them in the near
future, unless and until we begin to realize revenues and become
profitable in our business operations.
Indemnification
Under our Articles of Incorporation and Bylaws of the
corporation, we may indemnify an officer or director who is made a
party to any proceeding, including a law suit, 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.
26
- --------------------------------------------------------------------
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.
Name and Address Number of Number Percentage of
Beneficial Shares Before of Shares of Ownership
Owner [1] Offering After Offering After Offering
Allan W. Brandys 2,500,000 2,500,000 35.71%
6211 Boundary Dr. W.
Unit 16
Surrey, B.C.
Canada V3X 3G7
Douglas H. Hopper 2,500,000 2,500,000 35.71%
72727 Kingsway Ave.
Suite 907
Burnaby, British Columbia
Canada V5E 1G4
- --------------------
All Officers and
Directors as a
Group (2 persons) 5,000,000 5,000,000 71.43%
[1] The persons 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. Brandys and Hopper are the only
promoters of our company.
Future Sales by Existing Stockholders
A total of 5,000,000 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.
27
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 100,000,000 shares of
common stock, par value $0.00001 per share. The holders of our common
stock:
* have equal ratable rights to dividends from funds legally
available if and when declared by our board of directors;
* 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;
* do not have preemptive, subscription or conversion rights
and there are no redemption or sinking fund provisions or
rights; and
* are entitled to one non-cumulative vote per share on all
matters on which stockholders may vote.
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.
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 71.43% of our outstanding shares.
28
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 under section 15(d) of the Securities 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, D.C. 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.
Stock Transfer Agent
Our stock transfer agent for our securities is Securities
Transfer Corporation, 2591 Dallas Parkway, Suite 102, Frisco, Texas
75034 and its telephone number is (469) 633-0101.
- --------------------------------------------------------------------
CERTAIN TRANSACTIONS
- --------------------------------------------------------------------
In October 2000, we issued a total of 5,000,000 shares of
restricted common stock to Alan W. Brandys and Douglas H. Hopper,
officers and directors of our company. This was accounted for as a
compensation expense of $251,992 and advances and reimbursement
expenses of $23,008.
Since our inception, Messrs. Brandys and Hopper, advanced loans
to us in the total sum of $23,008, which were used for organizational
and start-up costs and operating capital. The loans do not bear
interest and have not been paid as of the date hereof. There are no
documents reflecting the loan and they are not due on a specific
date . Messrs Brandy and Hopper will accept repayment from us when
money is available.
29
- --------------------------------------------------------------------
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
December 31, 2000, included in this prospectus have been audited by
Williams & Webster, P.S., Independent Certified Public Accountants,
601 West Riverside Avenue, Suite 1940, Spokane, Washington 99201, as
set forth in their report included in this prospectus.
- --------------------------------------------------------------------
LEGAL MATTERS
- --------------------------------------------------------------------
Conrad C. Lysiak, Attorney at Law, 601 West First Avenue, Suite
503, Spokane, Washington 99201, telephone (509) 624-1475 has acted as
legal counsel for our company.
- --------------------------------------------------------------------
FINANCIAL STATEMENTS
- --------------------------------------------------------------------
Our fiscal year end is June 30. We will provide audited
financial statements to our stockholders on an annual basis; the
statements will be prepared by an Independent Certified Public
Accountant.
Our audited financial statement from inception to October 31,
2000 immediately follows:
INDEPENDENT AUDITOR'S REPORT F-1
FINANCIAL STATEMENTS
Balance Sheet F-2
Statement of Operations F-3
Statement of Stockholders' Equity F-4
Statement of Cash Flows F-5
NOTES TO THE FINANCIAL STATEMENTS F-6
30
To the Board of Directors and Stockholders
Zeolite Mining Corporation
Vancouver, BC
CANADA
INDEPENDENT AUDITOR'S REPORT
We have audited the accompanying balance sheet of Zeolite Mining
Corporation, an exploration stage enterprise a State of Nevada
corporation, as of December 31, 2000, and the related statements of
operations, stockholders' equity and cash flows for the period from
October 5, 2000 (inception) to December 31, 2000. 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 audit.
We conducted our audit in accordance with U.S. generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides 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 Zeolite
Mining Corporation as of December 31, 2000, and the results of its
operations and its cash flows for the period from October 5, 2000
(inception) to December 31, 2000, in conformity with U.S. generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in
Note 2, the Company has been in the exploration stage since its
inception on October 5, 2000. Realization of a major portion of the
assets is dependent upon the Company's ability to meet its future
financing requirements, and the success of future operations. These
factors raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans regarding those
matters also are described in Note 2. The financial statements do
not include any adjustments that might result from the outcome of
this uncertainty.
/s/ Williams & Webster, P.S.
Williams & Webster, P.S.
Certified Public Accountants
Spokane, Washington
January 29, 2001
F-1
31
ZEOLITE MINING CORPORATION
(An Exploration Stage Company)
BALANCE SHEETS
December 31, 2000
ASSETS
CURRENT ASSETS $ -
-------------
OTHER ASSETS
Mining Claims 500
-------------
Total Other Assets 500
-------------
TOTAL ASSETS $ 500
=============
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES $ -
-------------
COMMITMENTS AND CONTINGENCIES -
-------------
STOCKHOLDERS' EQUITY
Common stock, 100,000,000 shares authorized;
$0.00001 par value; 5,000,000 shares issued
and outstanding. 50
Additional paid-in capital 274,950
Accumulated deficit during exploration stage (274,500)
-------------
TOTAL STOCKHOLDERS' EQUITY 500
-------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 500
=============
The accompanying notes are an integral part of these financial
statements.
F-2
32
ZEOLITE MINING CORPORATION
(An Exploration Stage Company)
STATEMENTS OF OPERATIONS
For the period from October 5, 2000 (Inception) to December 31, 2000
REVENUES $ -
------------
EXPENSES
Consulting services provided by officers 251,992
Legal fees 20,000
Mining exploration 2,468
General and administrative expenses 40
------------
TOTAL EXPENSES 274,500
------------
LOSS BEFORE INCOME TAXES (274,500)
INCOME TAXES -
------------
NET LOSS $ (274,500)
============
NET LOSS PER COMMON SHARE
BASIC AND DILUTED $ (0.05)
============
WEIGHTED AVERAGE NUMBER OF
COMMON STOCK SHARES OUTSTANDING
BASIC AND DILUTED 5,000,000
============
The accompanying notes are an integral part of these financial
statements.
F-3
33
ZEOLITE MINING CORPORATION
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
For the period from October 5, 2000 (Inception) through
December 31, 2000
Deficit
Accumulated
Common Stock Additional During
Number Paid-in Exploration
of Shares Amount Capital Stage Total
Issuance of common
stock for mining
claims and officers'
compensation at $0.055
per share 5,000,000 $ 50 $ 274,950 $ - $ 275,000
Net loss for the
period ended
12-31-00 - - - (274,500) (274,500)
--------- ----- --------- ---------- --------
Balance,
12-31-00 5,000,000 $ 50 $ 274,950 $ (274,500) $ 500
========= ===== ========= ========== ========
The accompanying notes are an integral part of these financial
statements.
F-4
34
ZEOLITE MINING CORPORATION
(An Exploration Stage Company)
STATEMENTS OF CASH FLOWS
For the period from October 5, 2000 (Inception) through
December 31, 2000
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (274,500)
Adjustments to reconcile net loss to net
cash used by operating activities
Stock issued for services 274,500
------------
Net cash used by operating activities -
------------
CASH FLOWS FROM INVESTING ACTIVITIES -
------------
CASH FLOWS FROM FINANCING ACTIVITIES -
------------
Increase in cash -
Cash, beginning of period -
------------
Cash, end of period $ -
============
SUPPLEMENTAL DISCLOSURES
Interest paid $ -
============
Income taxes paid $ -
============
NON-CASH TRANSACTIONS
Stock issued in payment of expenses $ 274,500
Stock issued in payment of mining claims $ 500
The accompanying notes are an integral part of these financial
statements.
F-5
35
ZEOLITE MINING CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2000
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Zeolite Mining Corporation (hereinafter "the Company") filed for
incorporation on October 5, 2000 under the laws of the state of
Nevada primarily for the purpose of acquiring, exploring, and
developing mineral properties. The Company's fiscal year end is June
30.
The Company is actively seeking additional capital and management
believes that the Company can develop mineral properties, which it
has acquired in British Columbia. However, there are inherent
uncertainties in mining operations and management cannot provide
assurances that it will be successful in this endeavor. Furthermore,
the Company is in the exploration stage, as it has not realized any
significant revenues from its planned operations.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant accounting policies is presented to
assist in understanding the financial statements. The financial
statements and notes are representations of the Company's management,
which is responsible for their integrity and objectivity. These
accounting policies conform to accounting principles generally
accepted in the United States of America and have been consistently
applied in the preparation of the financial statements.
Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting.
Use of Estimates
The process of preparing financial statements in conformity with
accounting principles generally accepted in the United States of
America requires the use of estimates and assumptions regarding
certain types of assets, liabilities, revenues, and expenses. Such
estimates primarily relate to unsettled transactions and events as of
the date of the financial statements. Accordingly, upon settlement,
actual results may differ from estimated amounts.
Exploration Stage Activities
The Company has been in the exploration stage since its formation in
October 2000 and has not yet realized any revenues from its planned
operations. It is primarily engaged in the acquisition, exploration
and development of mining properties. Upon location of a commercial
minable reserve, the Company expects to actively prepare the site for
its extraction and enter a development stage.
F-6
36
ZEOLITE MINING CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2000
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Foreign Currency Transactions
Through the course of business, the Company has received services
that were billed in a currency other than the United States dollar,
the Company's functional currency. Management has elected to value
foreign currency transactions at average rates of exchange in effect
during the reporting period. Realized gains and losses from foreign
currency transactions are reflected in the results of operations.
Cash and Cash Equivalents
For purposes of the Statement of Cash Flows, the Company considers
all short-term debt securities purchased with a maturity of three
months or less to be cash equivalents.
Derivative Instruments
In June 1998, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards ("SFAS") No. 133,
"Accounting for Derivative Instruments and Hedging Activities." This
standard establishes accounting and reporting standards for
derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities. It requires
that an entity recognize all derivatives as either assets or
liabilities in the balance sheet and measure those instruments at
fair value.
At December 31, 2000, the Company has not engaged in any transactions
that would be considered derivative instruments or hedging
activities.
Impaired Asset Policy
In March 1995, the Financial Accounting Standards Board issued a
statement titled "Accounting for Impairment of Long-lived Assets."
In complying with this standard, the Company reviews its long-lived
assets quarterly to determine if any events or changes in
circumstances have transpired which indicate that the carrying value
of its assets may not be recoverable. The Company does not believe
any adjustments are needed to the carrying value of its assets at
December 31, 2000.
Exploration Costs
In accordance with generally accepted accounting principles, the
Company expenses exploration costs as incurred.
F-7
37
ZEOLITE MINING CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2000
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Provision for Taxes
At December 31, 2000, the Company had a net operating loss of
approximately $274,000. No provision for taxes or tax benefit has
been reported in the financial statements, as there is not a
measurable means of assessing future profits or losses.
Basic and Diluted Loss Per Share
Loss per share was computed by dividing the net loss by the weighted
average number of shares outstanding during the period. The weighted
average number of shares was calculated by taking the number of
shares outstanding and weighting them by the amount of time that they
were outstanding. Basic and diluted loss per share was the same, as
there were no common stock equivalents outstanding.
Going Concern
The Company's financial statements have been presented on a going
concern basis that contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. As
shown in the accompanying financial statements, the Company incurred
a net loss of $274,500 for the period ended December 31, 2000, and
had no sales. These conditions raise substantial doubt about the
Company's ability to continue as a going concern. Management has
plans to seek additional capital through a private placement and
public offering of its common stock. The financial statements do not
include any adjustments relating to the recoverability and
classification of recorded assets, or the amounts and classifications
of liabilities that might be necessary in the event the Company
cannot continue in existence.
NOTE 3 - COMMON STOCK
On October 5, 2000, 5,000,000 shares of common stock were issued to
officers and directors only. There was no public offering of any
securities. The above referenced shares were issued in payment of
consulting services in the amount of $251,992, legal fees in the
amount of $20,000, acquisition of mining claims for $500, and
expenses of $2,468. These shares were issued pursuant to exemption
from registration contained in Section 4(2) of the Securities Act of
1933.
NOTE 4 - RELATED PARTIES
The Company occupies office space provided by an officer of the
Company at no charge. The value of this space is not considered
materially significant for financial reporting purposes.
38
ZEOLITE MINING CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
December 31, 2000
NOTE 4 - RELATED PARTIES (Continued)
The shareholders of the Company paid expenses and advanced funds on
behalf of the Company, and were repaid by the issuance of Common
Stock. See Note 3.
NOTE 5 - COMMITMENTS AND CONTINGENCIES
Mining Industry
The Company is engaged in the exploration and development of mineral
properties. At present there are no feasibility studies establishing
proven and probable reserves.
Although the minerals exploration and mining industries are
inherently speculative and subject to complex environmental
regulations, the Company is unaware of any pending litigation or of
any specific past or prospective matters which could impair the value
of its mining claims.
Registration with the Securities and Exchange Commission
The Company is presently undertaking the required steps to register
as a publicly traded company. In this regard, the Company has signed
a contract with a securities attorney to assist in this matter. The
total fees to be paid to the attorney amount to $35,000 of which
$20,000 has been paid and is reflected in the accompanying financial
statements. The remaining $15,000 is due thirty days after the
Company's registration statement is declared effective by the
Securities and Exchange Commission.
Foreign Operations
The accompanying balance sheet includes $500 relating to the
Company's assets in Canada. Although this country is considered
politically and economically stable, it is always possible that
unanticipated events in foreign countries could disrupt the Company's
operations.
F-9
39
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 . . . . . . . 1,500.00
Accounting Fees and Expenses . . . . . 5,000.00
Legal Fees and Expenses . . . . . . 35,000.00
Blue Sky Fees/Expenses . . . . . . 5,000.00
Transfer Agent Fees . . . . . . 1,000.00
Miscellaneous Expenses . . . . . . 2,400.00
------------
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.
40
Name and Address Date Shares Consideration
- ------------------ --------- --------- ----------------
Alan W. Brandys 10/7/00 2,500,000 Services valued at
6211 Boundary Dr. W. $125,996 and advances of
Unit 16 $11,504
Surrey, British Columbia
Canada V3X 3G7
Douglas H. Hopper 10/7/00 2,500,000 Services valued at
203 - 828 W. Hastings. St. $125,996 and advances of
Vancouver, British Columbia $11,504
Canada V6C 1C8
We issued the foregoing restricted shares of common stock to
Messrs Brandys and Hopper pursuant to Section 4(2) of the Securities
Act of 1933. Messrs Brandys and Hopper are sophisticated investors,
are officers and directors of the company, and where 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 general solicitation was made to anyone.
ITEM 27. EXHIBITS.
The following Exhibits are filed as part of this Registration
Statement, pursuant to Item 601 of Regulation K. 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 Conrad C. Lysiak, Esq. regarding the
legality of the Securities being registered.
10.1 Cash 1 Claim.
10.2 Cash 3 Claim.
10.3 Cash 5 Claim.
10.4 Cash 6 Claim.
23.1 Consent of Williams & Webster, P.S., Certified Public
Accountants.
23.2 Consent of Conrad C. Lysiak, Esq.
99.1 Subscription Agreement.
41
ITEM 28. UNDERTAKINGS.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 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.
The undersigned registrant hereby undertakes:
1. To file, 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.
42
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, British Columbia, Canada on
this 2nd day of March, 2001.
ZEOLITE MINING CORPORATION
BY: /s/ Alan W. Brandys
Alan W. Brandys
President, Chief Executive Officer,
Principal Accounting Officer, Principal
Financial Officer and a member of the
Board of Directors
KNOW ALL MEN BY THESE PRESENT, that each person whose signature
appears below constitutes and appoints Alan W. Brandys, 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.
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
/s/ Alan W. Brandys President, Chief Executive March 2, 2001
Alan W. Brandys Officer, Treasurer, Principal
Accounting Officer, Principal
Financial Officer, and a member
of the Board of Directors
/s/ Douglas H. Hopper Vice President, Secretary, March 3, 2001
Douglas H. Hopper and a member of the Board
of Directors