As filed with the Securities & Exchange Commission on August 2, 2001
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2 - AMENDMENT NO. 3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
CASCADIA CAPITAL CORPORATION
(Name of small business issuer in its charter)
Nevada 1400
98-0222922
(State or jurisdiction of (Primary Standard Industrial
(I.R.S. Employer
incorporation or organization) Classification Code Number)
Identification No.)
Suite 2901, 1201 Marinaside Crescent
Vancouver, B.C.
V6Z 2V2 Canada
Telephone: (604)681-9588
(Address and telephone number of principal executive offices)
Suite 2901, 1201 Marinaside Crescent
Vancouver, B.C.
V6Z 2V2 Canada
(Address of principal place of business or intended principal place of business)
Gerald R. Tuskey, Personal Law Corporation
Suite 1000, 409 Granville Street
Vancouver, B.C.
V6C 1T2 Canada
(604)681-9588
(Name, Address and telephone number of agent for service)
Approximate date 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 securities for an offering pursuant
to Rule 462(b) under 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 pursuant to Rule 462(c) under
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 pursuant to Rule 462(d) under
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 pursuant to Rule 434, check
the following box. [___]
CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
- --------------------------------------
Title of each
Class of Proposed Proposed
Amount of
Securities to Amount to be Maximum Offering Maximum
Aggregate Registration
Be Registered Registered Price per Share (1) Offering
Price Fee (2)
- --------------------------------------------------------------------------------
- --------------------------------------
Common Stock, 2,200,000 shares $0.50
$1,100,000 $275.00
Par value $0.0001
- --------------------------------------------------------------------------------
- --------------------------------------
(1) Based on last price at which shares have been sold.
(2) Estimated solely for the purpose of calculating the registration fee
under Rule 457 of the Securities Act.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR 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 STATEMENTS SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
PART I - INFORMATION REQUIRED IN PROSPECTUS
2
PROSPECTUS
CASCADIA CAPITAL CORPORATION
2,200,000 SHARES OF COMMON STOCK
Cascadia Capital Corporation is a junior mining exploration company organized in
the State of Nevada.
The selling shareholders named in this prospectus are offering the 2,200,000
common shares of our stock registered through this prospectus. The shares were
acquired by the selling shareholders directly from us in a private offering that
was exempt from registration under US securities laws.
Our common stock is presently not traded on any market or securities exchange.
This offering will expire 24 months from the effective date of this prospectus.
--------------------
THE PURCHASE OF THE SECURITIES OFFERED THROUGH THIS PROSPECTUS INVOLVES A HIGH
DEGREE OF RISK. SEE SECTION ENTITLED "RISK FACTORS" ON PAGE 6.
--------------------
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. Any representation to the contrary is a
criminal offense.
--------------------
The date of this Prospectus is August 2, 2001
TABLE OF CONTENTS
PROSPECTUS
SUMMARY.........................................................................
.......................5
RISK
FACTORS.........................................................................
.............................6
USE OF
PROCEEDS........................................................................
...........................8
DETERMINATION OF OFFERING
PRICE...........................................................................
........8
DILUTION........................................................................
..................................8
DIVIDEND
POLICY..........................................................................
.........................8
SELLING
SHAREHOLDERS....................................................................
..........................9
PLAN OF
DISTRIBUTION....................................................................
.........................11
LEGAL
PROCEEDINGS.....................................................................
...........................12
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS.....................................................12
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS ND
MANAGEMENT....................................................13
DESCRIPTION OF
SECURITIES......................................................................
..................13
INTERESTS OF NAMED EXPERTS AND
COUNSEL.........................................................................
..14
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES..............................14
ORGANIZATION WITHIN LAST FIVE
YEARS...........................................................................
...14
DESCRIPTION OF
BUSINESS........................................................................
..................15
PLAN OF
OPERATION.......................................................................
.........................16
Milestones for Exploration of the Thibert Creek
Properties....................................................17
DESCRIPTION OF
PROPERTY........................................................................
..................20
Office
Premises........................................................................
.......................20
Mining
Properties......................................................................
.......................20
CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS...................................................................2
3
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS.........................................................24
EXECUTIVE
COMPENSATION....................................................................
.......................24
INDEPENDENT PUBLIC
ACCOUNTANTS.....................................................................
..............25
INDEX TO FINANCIAL
STATEMENTS......................................................................
..............25
CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS....................................................................4
6
AVAILABLE
INFORMATION.....................................................................
.......................46
INDEMNIFICATION OF DIRECTORS AND
OFFICERS........................................................................
46
OTHER EXPENSES OF ISSUANCE AND
DISTRIBUTION....................................................................
..47
RECENT SALES OF UNREGISTERED
SECURITIES......................................................................
....47
EXHIBITS........................................................................
.................................48
UNDERTAKINGS....................................................................
.................................49
4
PROSPECTUS SUMMARY
OUR COMPANY
We were incorporated on October 29, 1999 under the laws of the State of Nevada
to engage in any lawful corporate purpose. On October 21, 2000, we entered into
a mineral option agreement to acquire two blocks of hard rock mineral claims and
one placer claim in the Liard Mining Division, Province of British Columbia,
Canada. We have named our initial property acquisition the Thibert Creek
Properties. This acquisition is the first material business which we have
undertaken. We are a junior mineral exploration company and seek to expand our
portfolio of mineral exploration properties in the Cascadia region.
We have not been involved in any bankruptcy, receivership or similar
proceedings.
All dollar amounts in this prospectus are U.S. dollars.
The Offering
Securities being registered: 2,200,000 shares of common stock held
by existing shareholders.
Securities Issued: 4,900,000 shares of common stock are
issued and outstanding as of the
date of this prospectus. The
2,200,000 shares of common stock to be
registered under this prospectus are
already issued and may be sold by
existing shareholders.
Use of Proceeds: We will not receive any proceeds from
the sale of shares sold by the
selling shareholders.
Reason for filing this Prospectus: The Securities and Exchange Commission
and National Association of
Securities Dealers have adopted the
position that securities of blank
check companies issued to affiliates
and non-affiliates are ineligible
for resale under Rule 144 unless those
previously issued securities are
registered under a registration
statement. As of the date of issuance
of our initial 4,700,000 common
shares, we were a blank check company
because we had not adopted a
definitive business plan. This prospectus
is being filed solely for the purpose
of registering 2,200,000 common
shares held by non affiliated
shareholders which would, but for the SEC
and NASD position on blank check
companies, be free of trading
restrictions.
Technical Terms Glossary
- ------------------------
The following defined technical terms are used in our prospectus:
"ANDESITES" means crystalline volcanic rock composed largely of the mineral
plagioclase feldspar.
"APHANITIC CHERTS" means a hard dense form of quartz in which the crystalline
components are not distinguishable by the unaided eye.
"ARGILLACEOUS" means rock or sediments largely composed of clay particles.
"ARGILLACEOUS MUDSTONE" means a sedimentary rock composed of fine grained
particles.
"CARBONACEOUS SHALE" means shale rich in carbon.
5
"CHERT" means hard dense rock composed predominantly of silica.
"CONCHOIDAL" means having a smoothly curved surface used to describe the
fracture surface of a rock.
"CONFORMABLE" means pertaining to the contact of rock types in an orderly
unbroken manner.
"CONTACT" means the surface between two different kinds of rock.
"DIACHRONOUS" means of a rock unit, varying in age in different areas.
"DOLOMITE" means calcium magnesium carbonate.
"DOLOMITIC LIMESTONE" means a limestone whose carbonate fraction contains more
than 50% dolomite.
"DOLOSTONE" means dolomitic limestone that is less than 50% dolomite.
"EROSION" means the wearing away of the earth's surface.
"FELDSPAR" means a group of silicate minerals that make up about 60% of the
outer nine miles of the earth's crust.
"FRACTURE" means breaks in a rock usually along flat surfaces.
"GRADATIONAL" means land having a uniform grade or slope through erosion.
"GREYWACKE" means an argillaceous sandstone.
"INTERCALATED" means a layer located between layers of different character.
"LITHIC" means rock composed of predominantly quartz or feldspar minerals.
"METAMORPHIC ROCK" means a rock formed from pre-existing solid rocks in response
to extreme changes in temperature and pressure.
"PELAGIC MARINE ENVIRONMENT" means the environment of an ocean floor at
relatively deep depths.
"PERMIAN" means period of geologic time from 280 to 225 million years ago.
"PHYLLITE" means a metamorphic rock derived from argillaceous sediments.
"PLAGIOCLASE" means a common rock forming feldspar containing either Sodium or
Calcium.
"PILLOW" means a pillow shaped structure attributed to the congealment of lava
under water.
"QUARTZ" means a common rock forming mineral.
"QUARTZ STOCKWORKS" means a quartz deposit forming a network of veins diffused
in the host rock.
"RECESSIVE" means undergoing or continuing erosion.
"SEDIMENTARY" means the process by which rock forming particles are accumulated
in layers on the earth's surface.
"SHALE" means fine grained sedimentary rock made up of soil or clay particles.
"SILICATE" means a large group of common minerals which contain silicon and
oxygen.
"SILICIFIED" means complete or partial replacement of rock by quartz.
"TUFFS" means a rock composed of consolidated volcanic ash.
"VOLCANIC SANDSTONE" means sandstone containing mostly volcanic material.
Expiration Date
- ---------------
This offering will expire 24 months from the effective date of this prospectus.
RISK FACTORS
An investment in our common stock involves a high degree of risk. You should
carefully consider the risks described below and the other information in this
prospectus and any other filings we make with the SEC in the future before
investing in our common stock. If any of the following risks occur, our
6
business, operating results and financial condition could be seriously harmed.
The value of our common stock could decline due to any of these risks, and you
may lose all or part of your investment.
We have no operating history or revenue which would permit you to judge the
- ---------------------------------------------------------------------------
probability of our success.
- ---------------------------
We have no operating history nor any revenues from operations since our
incorporation. We have no significant assets or financial resources. Our lack of
operating history makes it very difficult for you to make an investment decision
based upon our managerial skill. In the event our business fails as a result of
our lack of experience, you could lose your entire investment.
Our management is under no contractual obligation to remain with us and their
- -----------------------------------------------------------------------------
departure could cause our business to fail.
- -------------------------------------------
Our director and our officers have varied business interests and are working for
other companies. No member of management has signed a written employment
agreement with us and we cannot afford to pay management members. In the event
Mr. Ebert or Mr. Diakow decides to resign as a director or an officer of our
company, we may be unable to attract other qualified officers and directors.
We lack sufficient funds to complete all work phases on our property.
- ---------------------------------------------------------------------
We currently have cash on hand to complete a phase one and phase two work
program on our Thibert Creek Properties. In the event a phase three exploration
program is justified on our Thibert Creek Properties based on results from phase
one and phase two exploration, we would be required to spend additional funds of
approximately $100,000. We currently have only a portion of these additional
funds. In the event we are unable to raise funds to complete a phase three
exploration program if it is warranted, we would lose our existing property and
be without any assets.
There is uncertainty as to whether we will be able to acquire additional
- ------------------------------------------------------------------------
properties.
- -----------
We currently hold an option on only one set of mineral properties. We may be
unable to raise sufficient capital to acquire options on other exploration
properties in the future. In the event our current option property is without
merit, we may have no future exploration prospects.
Our properties are located in a harsh climactic area and there is seasonal
- --------------------------------------------------------------------------
access only.
- ------------
The exploration season on our current properties is limited to approximately
four months per year. The northern latitude at which our properties are located
may result in our company taking longer than expected to complete our
exploration program.
Our properties may not contain a commercially viable mineral deposit.
- ---------------------------------------------------------------------
Very few mineral exploration targets actually contain commercially viable
mineral deposits. Both the size of a deposit and the cost of extracting ore are
key factors in determining whether a mineral deposit is commercially viable. The
area in which our claims are located has been explored in the past without a
commercially viable deposit being discovered. Our claims are located in a remote
area which would increase the cost of extracting ore in the event that a viable
mineral deposit is discovered.
We are a junior mineral exploration company in a weak competitive position
- --------------------------------------------------------------------------
within our industry.
- --------------------
We are able to complete basic grass roots mineral exploration with a limited
budget. However, we do not have the human resources or financial resources to
compete with senior mining exploration companies for more expensive exploration
targets.
Our Vice-President of Exploration and Acquisitions owns the mineral properties
- ------------------------------------------------------------------------------
which we have under option and is in a potential conflict of interest.
- ----------------------------------------------------------------------
We have optioned our Thibert Creek Properties from Mr. Diakow who will receive
additional shares of our company in the event promising exploration results are
received on the Thibert Creek Properties. Even though our exploration results
will be reviewed by an independent party, Mr. Diakow's ownership of the claims
under option by our company puts him in a potential conflict of interest.
7
We have one shareholder who owns a majority of our voting common shares.
- ------------------------------------------------------------------------
Our President, Mr. Keith Ebert, owns 51.65% of our current issued voting shares.
Mr. Ebert's majority voting position could allow him to initiate changes in our
corporate structure or policies which could serve Mr. Ebert's interests ahead of
the interests of other shareholders.
Our common shares are not quoted on any exchange or listing service. Our common
- -------------------------------------------------------------------------------
shares are penny stock.
- -----------------------
Persons who acquire our common shares have limited liquidity or opportunity to
sell their shares and may not be able to recover any funds which have been
invested in our common shares. Our common shares fall within the definition of a
penny stock. In the event our shares become quoted on an exchange or listing
service, all transactions involving our shares will be subject to special rules
established by the Securities and Exchange Commission which require brokers and
dealers to complete due diligence on penny stocks being acquired on behalf of
clients. These requirements are onerous and may make an investment in penny
stocks less appealing to certain investors which could affect your ability to
sell our common shares.
FORWARD LOOKING STATEMENTS
This prospectus contains forward-looking statements that involve risks and
uncertainties. We use words such as "anticipate," "believe," "plan," "expect,"
"future," "intend" and similar expressions to identify such forward-looking
statements. You should not place reliance on these forward-looking statements.
Our actual results could differ materially from those anticipated in these
forward-looking statements for many reasons, including the risks faced by us
described in the Risk Factors section and elsewhere in this prospectus.
USE OF PROCEEDS
All of the common shares being registered under this prospectus are owned by
existing shareholders of our company. In the event registered shares are sold in
the future, all proceeds will accrue to the selling shareholders.
DETERMINATION OF OFFERING PRICE
It is not currently possible to determine a price at which the shares being
registered under this prospectus may be sold. The shares being registered were
acquired by our shareholders at $0.001 per share. Our common shares are not
quoted or listed on any exchange. Future sales of the registered shares either
through private transactions or a future listing will be determined by market
forces and the independent decisions of selling shareholders.
DILUTION
The common stock to be sold by the selling shareholders is common stock that is
currently issued and outstanding. Accordingly, there will be no dilution to our
existing shareholders.
DIVIDEND POLICY
We have not declared or paid any cash dividends on our common stock. We
currently intend to retain future earnings, if any, to finance the expansion of
our business. We do not anticipate paying any cash dividends in the foreseeable
future.
8
SELLING SHAREHOLDERS
The selling shareholders named in this prospectus are registering a total of
2,200,000 common shares for possible future resale. All shares being registered
were acquired by the selling shareholders on November 1, 1999 at $0.001 per
share under Regulation S. The Regulation holding period on these shares has been
satisfied in accordance with Rule 903(b)(3)(iii)(A). Only common shares owned by
shareholders who are non-affiliates are being registered under this prospectus.
Our director, Mr. Keith Ebert, owns 2,500,000 of our common shares which are not
being qualified for resale under this prospectus.
The following table provides information regarding the beneficial ownership of
our common stock held by each of the selling shareholders as of August 2, 2001.
To the best of our knowledge, the shareholders in the table that follows are the
beneficial owners and have the sole voting and investment power over all shares
or rights to the shares reported.
- --------------------------------------------------------------------------------
- -----------
TOTAL NUMBER
CURRENT
SHARES OWNED OF SHARES BEING
PERCENT OF
PRIOR TO THIS REGISTERED BY
COMPANY
NAME AND ADDRESS OFFERING SELLING
SHARES
OF SELLING SHAREHOLDER SHAREHOLDER
OWNED
- --------------------------------------------------------------------------------
- -----------
Tom Bollum 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Renata Kubicek 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Gerald J. Shields 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Sandra Ann Hughes 50,000 50,000
1.03%
Surrey, B.C.
- --------------------------------------------------------------------------------
- -----------
Rob Smith 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Jackie A. Tuskey 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Darren Ross 50,000 50,000
1.03%
South Surrey, B.C.
- --------------------------------------------------------------------------------
- -----------
Brian Tuskey 50,000 50,000
1.03%
Courtenay, B.C.
- --------------------------------------------------------------------------------
- -----------
Mary Ann Myers 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Tom Connell 50,000 50,000
1.03%
Oshawa, Ontario
- --------------------------------------------------------------------------------
- -----------
Dr. Keith Lim Inc. 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Jane Shields 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Doug Irwin 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Margot Jones 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
John Furlan 50,000 50,000
1.03%
Calgary, Alberta
- --------------------------------------------------------------------------------
- -----------
Rick Gateman 50,000 50,000
1.03%
Calgary, Alberta
- --------------------------------------------------------------------------------
- -----------
Tom Simmons 50,000 50,000
1.03%
Calgary, Alberta
- --------------------------------------------------------------------------------
- -----------
9
- --------------------------------------------------------------------------------
- -----------
John Jardine 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Gail Fish 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Ro Lal 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Erin Strench 50,000 50,000
1.03%
Puerto Vallarta, Mexico
- --------------------------------------------------------------------------------
- -----------
Allen Wilson 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Beverly Strench 50,000 50,000
1.03%
Richmond, B.C.
- --------------------------------------------------------------------------------
- -----------
Neville Ebert 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Gloria Martino 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Bill Martino 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Andrew Allan 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Haroon Rashid 50,000 50,000
1.03%
Surrey, B.C.
- --------------------------------------------------------------------------------
- -----------
Ann Marie Butler Rashid 50,000 50,000
1.03%
Halifax, Nova Scotia
- --------------------------------------------------------------------------------
- -----------
Kenny Chan 50,000 50,000
1.03%
Richmond, B.C.
- --------------------------------------------------------------------------------
- -----------
Dwight Chan 50,000 50,000
1.03%
Richmond, B.C.
- --------------------------------------------------------------------------------
- -----------
Dee Gorrell 50,000 50,000
1.03%
Delta, B.C.
- --------------------------------------------------------------------------------
- -----------
Shauna Loiselle 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Paul Canfield 50,000 50,000
1.03%
Keswick, Ontario
- --------------------------------------------------------------------------------
- -----------
Janet Moher 50,000 50,000
1.03%
Oshawa, Ontario
- --------------------------------------------------------------------------------
- -----------
Ruth Canfield 50,000 50,000
1.03%
Bowmanville, Ontario
- --------------------------------------------------------------------------------
- -----------
Jill Jankovich 50,000 50,000
1.03%
Gabriola Island, B.C.
- --------------------------------------------------------------------------------
- -----------
Dan Nugent 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Judy Morey 50,000 50,000
1.03%
Calgary, Alberta
- --------------------------------------------------------------------------------
- -----------
Rob Furlan 50,000 50,000
1.03%
Calgary, Alberta
- --------------------------------------------------------------------------------
- -----------
Sandra Furlan 50,000 50,000
1.03%
Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Karen Lynn Bollum 50,000 50,000
1.03%
Salmon Arm, B.C.
- --------------------------------------------------------------------------------
- -----------
Dr. Denis Vincent 50,000 50,000
1.03%
North Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
Lindsay Nevison 50,000 50,000
1.03%
West Vancouver, B.C.
- --------------------------------------------------------------------------------
- -----------
10
PLAN OF DISTRIBUTION
The selling shareholders have not informed us of how they plan to sell their
shares. However, they may sell some or all of their common stock in one or more
transactions, including block transactions:
(1) on such public markets or exchanges as the common stock may from
time to time be trading;
(2) in privately negotiated transactions;
(3) through the writing of options on the common stock;
(4) in short sales; or
(5) in any combination of these methods of distribution.
The sales price to the public may be:
(1) the market price prevailing at the time of sale;
(2) a price related to such prevailing market price; or
(3) such other price as the selling shareholders determine from time
to time.
The selling shareholders may also sell their shares directly to market makers
acting as principals or brokers or dealers, who may act as agent or acquire the
common stock as a principal. Any broker or dealer participating in transactions
as agent may receive a commission from the selling shareholders, or, if they act
as agent for the purchaser of common stock, from the purchaser. The selling
shareholders will likely pay the usual and customary brokerage fees for
services. Brokers or dealers may agree with the selling shareholders to sell a
specified number of shares at a stipulated price per share and, to the extent
such broker or dealer is unable to do so acting as agent for the selling
shareholders, to purchase, as principal, any unsold shares at the price required
to fulfill the respective broker's or dealer's commitment to the selling
shareholders. Brokers or dealers who acquire shares as principals may thereafter
resell shares from time to time in transactions in a market or on an exchange,
in negotiated transactions or otherwise, at market prices prevailing at the time
of sale or at negotiated prices, and in connection with re-sales may pay or
receive commissions to or from the purchasers of shares. These transactions may
involve cross and block transactions that may involve sales to and through other
brokers or dealers.
We are bearing all costs relating to the registration of the common stock under
this prospectus. Any commissions or other fees payable to brokers or dealers in
connection with any sale of the common stock, however, will be borne by the
selling shareholders or other party selling such common stock.
The selling shareholders must comply with the requirements of the Securities Act
of 1933 and the Securities Exchange Act of 1934 in the offer and sale of their
common stock. In particular, during such times as the selling shareholders may
be deemed to be engaged in a distribution of the common stock, and therefore be
considered to be an underwriter, they must comply with applicable law and may,
among other things:
(1) not engage in any stabilization activities in connection with our
common stock;
(2) furnish each broker or dealer through which common stock may be
offered, such copies of this prospectus, as amended from time to
time, as may be required by such broker or dealer; and
(3) not bid for or purchase any of our securities or attempt to induce
any person to purchase any of our securities other than as
permitted under the Securities Exchange Act.
11
LEGAL PROCEEDINGS
We are not currently a party to any legal proceedings.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
Our directors and officers are as follows:
NAME AGE POSITION
- ---- --- --------
Keith Ebert 35 President, Secretary, C.F.O. and Director
Gerry Diakow 52 Vice-President, Exploration and Acquisitions
Our officers and director will serve until the next annual meeting of the
shareholders or until his death, resignation, retirement, removal, or
disqualification, or until his successors have been elected. Vacancies in the
existing Board of Directors are filled by majority vote of the remaining
directors. Our officer serves at the will of the Board of Directors. There are
no family relationships between any executive officer and/or director.
Resumes
- -------
Keith Ebert was appointed to his positions on October 30, 1999. Mr. Ebert
devotes his time on an as needed basis which he expects to be approximately ten
hours per month. During the calendar year ended December 31, 2000, Mr. Ebert
dedicated approximately 150 hours to the business of operating our company. Mr.
Ebert is not a director or officer of any other reporting company however Mr.
Ebert acts as a contract consultant to other companies who pay Mr. Ebert for his
services. Mr. Ebert's consulting obligations take up the majority of Mr. Ebert's
working hours.
Mr. Ebert is a qualified Mechanical Engineer BA Sc., MECH (UBC) (1987). For the
period from May, 1997 to the present, Mr. Ebert has been self employed managing
his investment portfolio. Mr. Ebert worked for Marleau, Lemire Securities Inc.
from February, 1993 to July, 1995 as manager of North American West Coast
institutional sales. Mr. Ebert worked for C.M. Oliver & Co. Ltd. from July, 1995
to May, 1997 as manager of North American West Coast institutional sales.
Marleau, Lemire Securities Inc. and C.M. Oliver & Co. Ltd. were broker dealers
registered by the Investment Dealers Association of Canada. In addition to being
a qualified mechanical engineer, Mr. Ebert has passed the Canadian Investment
Dealers Association's branch manager's exam and partners, directors and
officers' exam. Mr. Ebert acted as branch manager of C.M. Oliver & Co. Ltd. in
London, England from October, 1995 to January, 1997.
Gerry Diakow was appointed to his position on November 14, 2000. Mr. Diakow is
not a director or officer of any other reporting company. Mr. Diakow is a
consulting geologist and works for other companies who pay Mr. Diakow for his
services. The majority of Mr. Diakow's working hours are spent on his consulting
obligations. Mr. Diakow joined our company on November 14, 2000. Mr. Diakow
spent approximately 50 hours working on our corporate business between his
appointment and the end of the 2000 calendar year.
From January, 1999 to the present, Mr. Diakow has acted as a contract project
manager for Trilogy Minerals Inc., a public company listed on the Canadian
Venture Exchange. From June, 1997 to January, 1999, Mr. Diakow acted as
President of Pacific Mining Co., a privately held Honduran mineral exploration
company. From January, 1994 until June, 1997, Mr. Diakow acted as President of
Cimarron Corp., a privately held British Columbia mining exploration company.
Mr. Diakow graduated with a BSc. in Chemistry from Vancouver City College and
the University of British Columbia. Mr. Diakow also studied civil and structural
engineering at the British Columbia Institute of Technology. Mr. Diakow
12
has been engaged primarily in mineral exploration for the past 34 years. Mr.
Diakow has been employed by major mineral exploration companies such as Union
Carbide Mining Exploration as a diamond drilling supervisor, Canadian Superior
Mining Exploration as a field geologist and Anaconda Mining Exploration as a
field data processor. Mr. Diakow has worked in mineral exploration extensively
in Canada, the Western United States and in Central America. Mr. Diakow is a
member of the American Society of Economic Geologists.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS ND MANAGEMENT
The table below lists the beneficial ownership of our voting securities by each
person known by us to be the beneficial owner of more than 5% of our securities,
as well as the securities beneficially owned by all our directors and officers.
Unless specifically indicated, the shareholders listed possess sole voting and
investment power with respect to the shares shown.
NAME AND ADDRESS AMOUNT AND NATURE
PERCENT
TITLE OF CLASS OF BENEFICIAL OWNER OF BENEFICIAL OWNER
OF CLASS
- -------------- ------------------- -------------------
--------
Common Keith Ebert 2,500,000 shares
51.65%
Suite 2901 Direct Ownership
1201 Marinaside Crescent
Vancouver, B.C.
V6Z 2V2
Common Gerry Diakow 100,000 shares
2.07%
1537 - 54th Street Direct Ownership
Tsawwassen, B.C.
Common Management as a 2,600,000 shares
53.72%
Group including directors Direct Ownership
and executive officers
DESCRIPTION OF SECURITIES
General
- -------
Our authorized capital stock consists of 100,000,000 shares of common stock at a
par value of $0.0001 per share.
The following description of our capital stock discloses all material
information relating to our common stock but is not a full summary of all
information relating to our common stock. The description is subject to and
qualified in its entirety by our articles of incorporation and bylaws, which are
included as exhibits to the registration statement of which this prospectus
forms a part, and by the provisions of applicable Nevada law.
Common Stock
- ------------
As of August 2, 2001, there were 4,900,000 shares of common stock issued and
outstanding that were held by 47 shareholders of record.
All shares of common stock have equal voting rights and are entitled to one vote
per share in all matters to be voted upon by shareholders. Our shares have no
pre-emptive, subscription, conversion or redemption rights and may be issued
only as fully paid and non-assessable shares. Cumulative voting in the election
of directors is not permitted, which means that the holders of a majority of our
issued shares
13
represented at any meeting where a quorum is present will be able to elect the
entire Board of Directors. In that event, the holders of the remaining shares of
common stock will not be able to elect any directors. In the event of
liquidation, each shareholder is entitled to receive a proportionate share of
our assets available for distribution to shareholders after the payment of
liabilities and after distribution of preferred amounts. All shares of our
common stock issued and outstanding are fully paid and non-assessable. Holders
of stock are entitled to share pro rata in dividends and distributions with
respect to the common stock out of funds legally available for that purpose.
There are no outstanding options or warrants to acquire our shares. 2,200,000 of
our shares are being registered under this registration statement and will
become free trading if this registration statement becomes effective. 100,000 of
our 4,900,000 issued shares are held by Mr. Diakow, an affiliate of our company.
An additional 2,500,000 of our issued shares are held by Mr. Ebert, an affiliate
of our company. The shares held by Messrs. Diakow and Ebert cannot be sold
unless they are registered under a registration statement.
INTERESTS OF NAMED EXPERTS AND COUNSEL
No expert or counsel named in this prospectus as having prepared or certified
any part of this prospectus or having given an opinion upon the validity of the
securities being registered or upon other legal matters in connection with the
registration or offering of the common stock was employed on a contingency
basis, or had, or is to receive, in connection with the offering, a substantial
interest, direct or indirect, in the registrant or any of its parents or
subsidiaries. Nor was any such person connected with the registrant or any of
its parents or subsidiaries as a promoter, managing or principal underwriter,
voting trustee, director, officer, or employee.
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES
ACT LIABILITIES
Our directors and officers are indemnified as provided by the Nevada Revised
Statutes (the "NRS") and our Bylaws. We have been advised that in the opinion of
the Securities and Exchange Commission indemnification for liabilities arising
under the Securities Act is against public policy as expressed in the Securities
Act, and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities is asserted by one of our directors,
officers, or controlling persons in connection with the securities being
registered, we will, unless in the opinion of our legal counsel the matter has
been settled by controlling precedent, submit the question of whether such
indemnification is against public policy to a court of appropriate jurisdiction.
We will then be governed by the court's decision.
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 small business issuer pursuant to the foregoing provisions, or otherwise,
the small business issuer 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.
ORGANIZATION WITHIN LAST FIVE YEARS
We were incorporated on October 29, 1999 under the laws of the State of Nevada
to engage in any lawful corporate purpose. On November 1, 1999, we issued
2,250,000 common shares at a deemed price of $0.001 per share to Mr. Keith
Ebert. Mr. Ebert was issued these shares in consideration for his services in
organizing our company and acting as an officer and director and building our
business plan. The value of the services rendered is $2,250. We relied on the
exemption contained in Regulation S of the Securities Act of 1933 to issue these
shares to Mr. Ebert.
14
On October 21, 2000, we entered into a mineral option agreement with Gerry
Diakow of Tsawwassen, British Columbia to acquire two blocks of hard rock
mineral claims and one placer claim in the Liard Mining Division, Province of
British Columbia, Canada. We issued Mr. Gerry Diakow 100,000 common shares on
November 16, 2000 in consideration for our option on the Thibert Creek
Properties. This acquisition was done at arm's length. Mr. Diakow was
subsequently appointed as an officer of our company. Mr. Diakow is now our
Vice-President of Exploration and Acquisitions. In order to fully exercise our
option on the Thibert Creek Properties, we are required to make cash payments to
Mr. Diakow and to issue shares of our common stock upon certain milestones being
achieved. To fully exercise our option on the Thibert Creek Properties, we are
required to pay Mr. Diakow cash of $25,000 before December 31, 2002 and to issue
Mr. Diakow an additional 950,000 of our common shares.
DESCRIPTION OF BUSINESS
(I) OUR PRINCIPAL PRODUCTS AND SERVICES
We are a junior mineral exploration company. We have an option to acquire two
blocks of hard rock mineral claims and one placer claim in the Liard Mining
Division in the Province of British Columbia. We acquired our option on the
Thibert Creek Properties in an arm's length negotiation with Mr. Gerry Diakow of
Tsawwassen, British Columbia. Following our acquisition of the option on the
Thibert Creek Properties, we offered Mr. Diakow the position of vice-president,
exploration and acquisitions. Mr. Diakow will be overseeing our initial
exploration on the Thibert Creek Properties and has been given the task of
assembling our portfolio of mineral exploration properties in Western Canada and
in the American Pacific Northwest.
(II) COMPETITIVE BUSINESS CONDITIONS AND OUR POSITION IN OUR INDUSTRY
Vast areas of Western Canada and the U.S. Pacific Northwest have been explored
and in some cases staked through mineral exploration programs. Vast areas also
remain unexplored. The cost of staking and re-staking new mineral claims and the
costs of most phase one exploration programs are relatively modest.
Additionally, in many more prospective areas, extensive literature is readily
available with respect to previous exploration and development activities. These
facts make it possible for a junior mineral exploration company with experienced
management such as ours to be very competitive with other similar companies. In
effect, we are also competitive with senior companies who are doing grass roots
exploration. In the event our exploration activities uncover prospective mineral
showings, we anticipate being able to attract the interest of better financed
industry partners to assist on a joint venture basis in more extensive
exploration. We are at a competitive disadvantage compared to established
mineral exploration companies when it comes to being able to complete extensive
exploration programs on claims which we hold or may hold in the future. If we
are unable to raise capital to pay for extensive claim exploration, we will be
required to enter into joint ventures with industry partners which will result
in our interest in our claims being substantially diluted.
As long as management of our company remains committed to building a portfolio
of mineral exploration properties principally through their own efforts, we will
be able to continue operating on modest cash reserves for an extended period of
time.
(iii) SOURCES AND AVAILABILITY OF RAW MATERIALS
Our management team seeks to assemble a portfolio of quality mineral exploration
properties in western Canada and in the U.S. Pacific Northwest. Management's
exploration experience and industry contacts will enable us to assemble the
portfolio of properties through grass roots exploration and staking by our own
management team and by acquiring new properties through option agreements where
new properties can be acquired on favourable terms.
15
(VI) REQUIREMENT OF GOVERNMENT APPROVAL
We are not in a business which requires government approval for principal
products or services. In the event mining claims which we own or which we
acquire in the future prove to host viable ore bodies, we would be required to
apply for numerous government approvals in order to commence mining. All costs
to obtain the necessary government approvals would be factored into technical
and viability studies in advance of a decision being made to proceed with
development of an ore body.
The mining industry in Canada and the United States is highly regulated. Our
Vice-President of Exploration and Acquisitions, Mr. Gerry Diakow, has extensive
industry experience and is familiar with all government regulations respecting
the initial acquisition and early exploration of mining claims in British
Columbia, Canada. We are unaware of any proposed or probable government
regulations which would have a negative impact on the mining industry in British
Columbia. We propose to adhere strictly to the regulatory framework which
governs mining operations in British Columbia.
(IV) COSTS AND EFFECTS OF COMPLIANCE WITH ENVIRONMENTAL LAWS
At the present time, our costs of compliance with environmental laws are minimal
as we are in the process of acquiring and doing preliminary exploration
activities only. In the event that claims which we now own or may acquire in the
future host a viable ore body, the costs and affects of compliance with
environmental laws will be incorporated in the exploration plan for these
claims. These exploration plans will be prepared by qualified mining engineers.
(V) OUR PART TIME EMPLOYEES
We currently have two part time employees, namely Mr. Gerry Diakow, our
Vice-President of Exploration and Acquisitions and Mr. Keith Ebert, our C.E.O.,
C.F.O. and Secretary. Mr. Ebert is also our sole director.
OUR EXPENDITURES DURING THE LAST TWO FISCAL YEARS ON RESEARCH AND DEVELOPMENT
ACTIVITIES
We were incorporated in October, 1999 and completed our first fiscal year end on
December 31, 2000. Since our inception, we have incurred expenditures of
approximately $2,000 relating to the preparation of our audited financial
statements. We have also issued 100,000 of our common shares at a deemed price
of $0.50 per share to Mr. Gerry Diakow in consideration for our option on the
Thibert Creek Properties.
PLAN OF OPERATION
In October, 2000, we issued 40,000 shares at $0.50 per share under Regulation S
to raise proceeds of $20,000. This small financing is sufficient to satisfy our
cash requirements for the next 12 months assuming that our activities are
limited to phase one and phase two exploration programs on our Thibert Creek
Properties. In July, 2001, we received an additional subscription for 60,000
shares at $0.50 per share under Regulation S which will add $30,000 to our
working capital position. Management of the Company will continue to actively
seek new investors to increase our cash reserves which will permit management to
seek additional mineral exploration properties.
We do not expect any significant changes in the number of our employees.
Presently, we are fortunate to have the services of an experienced
vice-president of exploration given our limited financial resources. Our current
management team will satisfy our requirements for the foreseeable future.
16
We expect to acquire as many mineral exploration prospects as possible over the
next 12 months given our limited financial resources. Where possible, we will
issue common shares in payment of new mineral properties or options to acquire
mineral properties to preserve our cash reserves.
Milestones for Exploration of the Thibert Creek Properties
- ----------------------------------------------------------
The Thibert Creek Properties are comprised of the PT claim block, the Vowel
claim block and the Birch placer claim.
On June 29, 2001, the first phase of exploration work on our PT Claims commenced
with the issuance to our company of work permit #SMI-01-0101689-091 by the
British Columbia Ministry of Energy and Mines. A crew of two men comprised of
our Vice-President of Exploration and a geophysical technologist started work on
the PT Claims on July 2, 2001. The exploration team completed geological
mapping, prospecting and geochemical sampling. The work involved surveying a
grid covering the claim area and the taking of magnatometer readings and soil
samples. This work was followed up with a very low frequency electro magnetic
survey at the grid stations.
Our phase one exploration program on the PT Claims was budgeted at $8,000.
Expenditures to date on phase one exploration of the PT Claims are approximately
$5,500. Soil samples have been submitted to an independent analysis lab in
Vancouver and assay results are expected near the end of July, 2001. Our final
expenditure on phase one for the PT Claims will be on budget. On receipt of the
assay results, management will fine tune the phase two exploration program for
the PT Claims. In addition to the phase one exploration program on the PT
Claims, Mr. Diakow and his assistant staked 12 additional claims in the name of
our company along the western boundary of the PT Claims. These claims, named the
Bell 1 to Bell 12 Claims, will ensure that our company adequately covers the
most interesting geological prospects found in this area.
Phase one exploration work on the Vowel claims is scheduled to commence in early
August, 2001 following phase one exploration work on the PT claim block. The
cost of phase one exploration work on the Vowel claim block will be minimized as
crew and equipment will already be near this site. A grid survey will be
completed over the claim area. A total of 8,000 meters of grid will be laid out
with lines spaced 200 meters apart. Magnetometer readings will be taken and site
soil samples will be collected. This work will be followed up with a very low
frequency electromagnetic survey with readings taken at the soil sample sites.
This exploration work will generate a magnetometer survey map, a VLF-EM survey
map and a geochemistry map. The table below itemizes the cost for phase one work
on the Vowel claim block.
- --------------------------------------------------------------------------------
- ---------------------
ITEM COST PER DAY NUMBER
TOTAL COST
OF DAYS
- --------------------------------------------------------------------------------
- ---------------------
Wages for a four man crew $550.00 3
$1,650.00
Room and board for crew $206.00 3
$618.00
Vehicle and fuel $52.00 3
$156.00
300 soil samples/$8.27 per
$2,482.00
Report writing and interpretation
$1,035.00
$5,941.00
- --------------------------------------------------------------------------------
- ---------------------
All phase one and phase two work on the PT and Vowel claims will be paid for
with cash on hand.
17
Phase two exploration on the PT and Vowel claims will cost approximately one
half as much as phase one work and involves examination and delineation of phase
one results. If anomalous zones are identified in phase one work on the PT or
Vowel claims, they will be thoroughly examined by a team of two prospectors and
rock samples will be collected for assay. These zones will be hand-trenched with
a view to locating and mapping rocks responsible for the anomalies. If trenching
succeeds in locating mineralization, a diamond drilling program would be
scheduled.
Trenching on the PT claims will follow the plotting of the geochemical soil
sampling results. The soil sample results plotted on the grid and located in the
field will indicate the anomalous areas on the grid. The prospector's will
return to these anomalous areas and map the outcropping rock, prospect and hand
trench these areas and sample and assay any mineralization found. This
exploration work would be undertaken approximately 3 weeks after the soil
samples from phase one work on the PT claims are submitted for assay. The PT
soil samples should be collected and sent to assay by mid July, 2001. Results
should be available by early August, 2001. Accordingly, prospecting, mapping and
trenching on the PT claims could be started by mid August, 2001.
The geophysical surveys, magnetometer and VLF-EM results should be plotted and
interpreted by early September, 2001. These results along with trenching work
should indicate the best targets for diamond drilling. Depending on the success
of initial exploration work and our ability to secure additional financing, a
drilling program could begin as early as mid October, 2001 on the PT claims.
The Vowel claims are at a higher elevation than the PT claims and for this
reason phase one exploration work will start later in the season, likely after
completion of phase one exploration work on the PT claims. The results from
geochemical soil sampling, geophysical magnetometer work and VLF-EM survey would
be plotted and interpreted by mid September, 2001. Prospecting, mapping,
trenching and sampling would start on the Vowel claim in late September, 2001.
Diamond drilling on the Vowel claim could start in late October, 2001 if
trenching and geophysical surveys succeed in locating diamond drill targets and
if financing for phase three work is secured.
The table below itemizes the cost of trenching and mapping the anomalous zones
on each of the PT and Vowel claim blocks.
- --------------------------------------------------------------------------------
- ---------------------
ITEM COST PER DAY NUMBER
TOTAL COST
OF DAYS
- --------------------------------------------------------------------------------
- ---------------------
Wages for two prospectors $345.00 5
$1,725.00
Room and board $103.00 5
$515.00
Vehicle and fuel $86.00 5
$430.00
25 assays/$14 per
$350.00
$3,020.00
- --------------------------------------------------------------------------------
- ---------------------
If assay results from mineralization are encouraging, a diamond drilling program
would be conducted to delineate the size and shape of the mineralized zones.
Assaying the drill core will establish the grade and value of mineralization.
Depending on our success in earlier exploration work, a drilling program could
begin in early winter of 2001. Weather conditions and the availability of
financing will dictate whether this potential program is deferred until the
spring of 2002. A program consisting of five 500-foot holes would be adequate
for this phase. A benchmark for this type of target would be 10% combined Pb-Zn
per ton and $35.00 per ton in Au and Ag values. Drilling costs would total
approximately $42,500.00, $17.00/foot x 2,500 feet; drill core assays $1,400.00,
$14.00/assay x 100 assays. The cost of employing a geologist to oversee drilling
operations and log core is $4,800.00.
18
This phase three methodology would be employed on the Vowel and PT claims.
However, work on the Vowel claims could be accelerated if trenches excavated in
1980 could be located. A drill program could also be fast-tracked on the Vowel
claims if the trench samples taken during previous exploration could be
repeated.
We will not generate revenues from operations unless we are successful in
discovering mineralization which is capable of sustaining commercial production.
Our option on the Thibert Creek Properties also entitles us to do work on the
Birch placer claim which is located at the confluence of Vowel and Thibert
Creeks between the Vowel and PT claims. Our current cash position will not
permit us to conduct exploration work on the Birch placer claim in 2001. We will
carry out the minimum work requirement of $500 to keep the claim in good
standing. When we have raised additional financing to proceed with exploration
on the Birch placer claim, we will proceed with the following exploration
program.
Testing the Birch claim will commence using a tracked excavator with a toothed 1
1/2-cubic-yard bucket. This work will be contracted out. A contractor from the
nearby community of Telegraph Creek will perform the work in return for a
percentage of the placer gold recovered from the workings. This kind of
arrangement is common in northern British Columbia where contractors are
employed to work ground whose title is controlled by another party. Prior the
contractor's arrival in the area two or three additional placer claims will be
staked in our name, guaranteeing that, in the event initial testing is
successful, ground adjacent the Birch claim can be secured for future
exploitation. Our proposed contractor is familiar with the area, having worked
ground 3 miles north of the Birch claim in 1999 prior to relocating his
operation to Telegraph Creek.
Excavated material will be passed through a pilot washing plant and the residual
fraction weighed and tested for gold content. The black sand from this fraction
will be concentrated and samples from the concentrate assayed.
We have completed phase one exploration on the PT Claims at a cost of $5,500. We
have cash on hand to finance phase one on the Vowel Claims and phase two
exploration on the Vowel and PT Claims. We currently have working capital of
approximately $20,000. We have received a subscription for 60,000 shares at
$0.50 per share which will provide us with additional working capital of
$30,000. Completion of the first two phases of exploration on the Vowel and PT
Claims will cost approximately $12,000 leaving us with a working capital balance
of $38,000. This provides us with enough working capital to complete the
exploration expenditures required under our option agreement to keep our option
in good standing until December 31, 2002. Our estimated cash on hand of $38,000
following the first two phases of exploration on the Vowel and PT Claims is not
enough capital to complete a phase three diamond drilling program on both the PT
and Vowel Claim blocks. We estimate approximately $100,000 would be required for
a phase three diamond drilling program on these two claim blocks. Cash on hand
following the first two phases of exploration on the PT and Vowel Claims would
permit us to commence a drilling program on one of our claim blocks. In the
event that exploration results from the first two phases of work on the Vowel
and PT Claims justifies a diamond drilling program on both the PT and Vowel
Claim blocks, we would be required to raise approximately an additional $60,000
to complete both phase three programs. Additional financing for these phase
three programs would be sought from management's mining industry contacts
including high net worth individuals and potentially other junior mining
companies.
In addition to the exploration expenditures outlined above for our Vowel and PT
Claims, we will incur the following additional costs to keep our mineral
property option in good standing. To acquire our option on the Thibert Creek
Properties, we issued Mr. Diakow 100,000 common shares at a deemed price of
$0.50 per share. To keep our option in good standing, we are required to issue
Mr. Diakow 50,000
19
shares on or before December 31, 2001 and pay $25,000 on or before December 31,
2002. We are also required to issue Mr. Diakow 200,000 common shares upon the
completion of a phase one work program on the Thibert Creek Properties subject
to an independent engineering or geological report detailing work done on the
property and recommending further work on the property. In the event a phase two
exploration program is warranted on the property, we would be required to issue
Mr. Diakow an additional 200,000 common shares on completion of the phase two
work program subject to an independent engineering or geological report
detailing work done on the property and recommending a third phase work program.
In the event a phase three work program is warranted, we would be required to
issue Mr. Diakow a final allotment of 500,000 of our common shares on completion
of the phase 3 work program subject to production of an independent engineering
or geological report detailing work done on the property and recommending that
the property be put into commercial production.
The option agreement also requires that we incur exploration expenditures on our
properties totaling $100,000. $10,000 must be spent on or before September 1,
2001, a further $40,000 on or before June 1, 2002 and a final $50,000 on or
before December 31, 2002.
In the event all necessary exploration expenditures, cash payments and share
issuances have been made, we will earn a 100% undivided right to the Thibert
Creek Properties subject to a 3% net smelter return payable to Mr. Diakow.
DESCRIPTION OF PROPERTY
Office Premises
- ---------------
We operate from our offices at Suite 2901, 1201 Marinaside Crescent, Vancouver,
British Columbia, V6Z 2V2, Canada. Space is provided to us on a rent free basis
by Mr. Ebert, a director of the Company. We are not a party to any lease. It is
anticipated that this arrangement will remain until we are able to generate
revenue from operations and require additional office space for new employees.
Management believes that this space will meet our needs for the foreseeable
future.
Mining Properties
- -----------------
Our mining properties consist of a placer claim and two blocks of hardrock
mineral claims administered by the British Columbia Ministry of Energy, Mines
and Petroleum Resources. In area these properties total 1,100 acres. To maintain
title over the mineral claims, we are required to expend $100 per claim in the
first year we hold the claims and $200 per claim for each additional year we
hold the claims beginning in 2003. The work requirement for our placer claim is
$500 per year. Our properties are without known reserves. Our program is
exploratory in nature.
Particulars of the claims are as follows:
CLAIM NAME RECORD NUMBER ANNIVERSARY DATE
YEAR OF EXPIRY
- ---------- ------------- ----------------
- --------------
Vowel #7 364416 Nov. 15
2001
Vowel #8 364417 Nov. 15
2001
Vowel #9 364418 Nov. 15
2001
Vowel #10 364419 Nov. 15
2001
Vowel #11 364420 Nov. 15
2001
Vowel #12 364421 Nov. 15
2001
Vowel #13 364422 Nov. 15
2001
Vowel #14 364423 Nov. 15
2001
PT #1 364396 Nov. 15
2001
PT #2 364397 Nov. 15
2001
PT #3 364398 Nov. 15
2001
20
PT #4 364399 Nov. 15
2001
PT #5 364400 Nov. 15
2001
PT #6 364401 Nov. 15
2001
PT #7 364402 Nov. 15
2001
PT#8 364403 Nov. 15
2001
PT#19 364442 Nov. 15
2001
PT#20 364443 Nov. 15
2001
Birch #1 364414 Nov. 15
2001
There are no historic mines or workings on our mining properties. The Thibert
Creek fault, which is exposed north of our claim blocks, has been explored for
Ni, Cu, Au and PGEs occurring in the footwall contact and quartz veins.
VOWEL MINERAL CLAIMS
Location, Access and Infrastructure
- -----------------------------------
The Vowel mineral claims are located 30 miles northwest of the Village of Dease
Lake, B.C. on the north side of Thibert Creek and on the south-facing slope of
Vowel Mountain. The claims lie at approximately 50 degrees, 50 minutes N.
latitude and 130 degrees, 30 minutes W. longitude.
Access to the property can be gained by helicopter from the village of Dease
Lake or by the Adsit Lake Mining road, a 4x4 road extending westward from the
north end of Dease Lake along the south side of Thibert Creek and approaching
within 1.5 kilometers of the property. Road access can be extended to the
property for a modest expenditure.
Communication with the exploration camp will be maintained by radiotelephone.
Fuel, groceries, accommodation and emergency facilities are available at the
village of Dease Lake.
Physiography, Vegetation and Climate
- ------------------------------------
The Vowel mineral claims are situated on the north side of Thibert Creek on the
south-facing slope of Vowel Mountain. The claim area ranges in elevation from
3,400 feet to 5,200 feet above sea level. The property lies in the sub-alpine
forest biotic zone and timberline occurs at approximately 4,700 feet.
The area experiences warm northern summers and cold winters, receiving low to
moderate levels of precipitation, ranging between 15 and 50 inches annually. A
moderate amount of precipitation occurs as snow.
Local Geology
- -------------
The Vowel claim group is underlain by intercalated sedimentary and volcanic
rocks of the French Range Formation. The volcanic rocks observed are generally
either fine-grained greenish crystalline andesites or layered or banded fine
grained, lithic andesitic tuffs. The sedimentary rocks observed include fine to
coarse grained grey limestones, grey to brown aphanitic cherts with a strong
conchoidal fracture, argillaceous mudstone, grey to black phyllite and a fine
grained carbonaceous shale. These rocks appear to have undergone a mild degree
of metamorphism and in places are silicified.
The rocks are thought to have been deposited in a pelagic marine environment,
and some of the andesitic volcanics may exhibit a `pillow' structure indicating
sub-marine volcanic deposition.
Considerable folding and fracturing is observed throughout the area. Evidence of
NE-SW folding with a northwesterly trending and shallow plunging fold axis is
observable in a number of places, and what has
21
been thought of as intercalations of volcanic members within the sedimentary
section may be a post-depositional fault contact. The fold axis appears to
steepen in some places.
PT MINERAL CLAIMS
Location, Access and Infrastructure
- -----------------------------------
The PT mineral claims are located 25 miles northwest of the Village of Dease
Lake, B.C. on the north side of Berry Creek straddling Adsit Lake Road. The
claims lie at approximately 50 degrees, 46 minutes N. latitude and 130 degrees,
19 minutes W. longitude.
Access to the property can be gained by helicopter from the Village of Dease
Lake or by the Adsit Lake mining road, a four by four road extending west from
the north end of Dease Lake along the south side of Thibert Creek. Adsit Lake
Road cuts through the northern half of the PT claims.
Communication with the exploration camp will be maintained by radio telephone.
Fuel, groceries, accommodation and emergency facilities are available at the
Village of Dease Lake.
Physiography, Vegetation and Climate
- ------------------------------------
The PT mineral claims are situated on the north side of Berry Creek in an area
which ranges in elevation from 2,800 feet to 4,000 feet above sea level. The
property lies in the sub alpine forest biotic zone and timberline occurs at
approximately 4,700 feet.
The area experiences warm northern summers and cold winters receiving low to
moderate levels of precipitation ranging between 15 and 50 inches annually. A
moderate amount of precipitation occurs as snow.
Local Geology
- -------------
The PT claims on Berry Creek overlie the Kedahda Formation, a generally
recessive, dominantly sedimentary succession [Watson and Mathews, 1944; Monger,
1969, 1975]. Discontinuous limestone, dolomitic limestone and dolostone units
occur in the Kedahda Formation, particularly in the French Range. This is the
case with respect to the PT claims where the volcanic sandstone or greywacke
surrounds massive limestone bluffs. Large quartz stockworks are exposed in upper
Berry Creek in the vicinity of the PT claims. However, no sulphides are observed
in the quartz stockworks. Mineralization is observed at the limestone-greywacke
contact on PT #7. The relationship between the greywacke-chert member of the
Kedahda Formation and the succession exposed farther southwest where the PT
claims are closest to the French Range is enigmatic [Gabrielse, 1998]. The rocks
may be separated by an unrecognizable fault downthrown to the northeast. On the
other hand, the French Range Formation strata, interpreted as representing a
volcanic plateau upon which Permian, shallow water limestone was deposited, were
succeeded to the northeast by deep water sediments which escaped significant
erosion during a period of falling sea levels in late Permian time [Gabrielse,
1998]. Contacts of the French Range Formation with underlying parts of the
Kedahda Formation are conformable and gradational [Monger, 1969]. The PT claims
are predominantly covered by till and forested, with the bulk of the rock
exposure occurring in creek beds. The Kedahda and French Formation lithologies
are present on the claims; however, the contact between the two Formations has
yet to be discovered and mapped.
22
THE BIRCH PLACER CLAIM
Location and Access
- -------------------
The Birch placer claim is located at the confluence of Vowel Creek and Thibert
Creek. Access is by the Adsit Lake Mining road, a 4x4 road extending west from
the north end of Dease Lake. The claim lies at approximately 50 degrees, 49
minutes N latitude and 130 degrees, 26 minutes W. longitude.
History
- -------
The ground covered by the Birch placer claim has never been placer mined. The
property lies in a region which attracted hand mining operations in the 1920's.
Early mining efforts in the area failed due to technical challenges which are
readily addressed by modern placer mining technology and methods. A combination
of physiographical factors in the area, the character of the placer gravels, the
flat terrain, gentle slope of bedrock and thin overburden makes it possible to
employ tracked excavators which are a highly efficient and low cost means of
working placer deposits.
Our current exploration budget does not provide for expenditures on the Birch
placer claim in 2001. A minimum work commitment of $500 will be made on the
Birch placer claim to keep the claim in good standing.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
We issued 2,250,000 common shares at a deemed price of $0.001 per share to Mr.
Keith Ebert on November 1, 1999. Mr. Ebert was issued these shares in
consideration for his services in organizing our company, acting as a director
and officer and building our business plan. Mr. Ebert is our President,
Secretary, Chief Financial Officer and a director.
On November 16, 2000, we issued Mr. Gerry Diakow 100,000 common shares in
consideration for our option on the Thibert Creek Properties. This acquisition
was done at arm's length. Mr. Diakow was subsequently appointed as an officer of
Cascadia. Mr. Diakow is our Vice-President of exploration and acquisitions.
Mr. Gerry Diakow is the registered owner of the Thibert Creek Properties. We
acquired an option to acquire the Thibert Creek Properties from Mr. Diakow under
an option agreement dated October 21, 2000. In order to fully exercise our
option on the Thibert Creek Properties, we are required to make cash payments to
Mr. Diakow and to issue shares of our common stock upon certain milestones being
achieved.
To acquire our option on the Thibert Creek Properties, we issued Mr. Diakow
100,000 common shares at a deemed price of $0.50 per share. To keep our option
in good standing, we are required to issue Mr. Diakow 50,000 shares at $0.50 per
share on or before December 31, 2001 and pay Mr. Diakow $25,000 on or before
December 31, 2002. We are also required to issue Mr. Diakow 200,000 common
shares upon the completion of a phase one work program on the Thibert Creek
Properties subject to an independent engineering or geological report detailing
work done on the property and recommending further work on the property. In the
event a phase two exploration program is warranted on the property, we would be
required to issue Mr. Diakow an additional 200,000 common shares on completion
of the phase two work program subject to an independent engineering or
geological report detailing work done on the property and recommending a third
phase work program. In the event a phase three work program is warranted, we
would be required to issue Mr. Diakow a final allotment of 500,000 of our common
shares on completion of the phase 3 work program subject to production of an
independent engineering or geological report detailing work done on the property
and recommending that the property be put into commercial production.
23
The option agreement also requires that we incur exploration expenditures on our
properties totaling $100,000. $10,000 must be spent on or before September 1,
2001, a further $40,000 on or before June 1, 2002 and a final $50,000 on or
before December 31, 2002.
In the event all necessary exploration expenditures, cash payments and share
issuances have been made, we will earn a 100% undivided right to the Thibert
Creek Properties subject to a 3% net smelter return payable to Mr. Diakow.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
No Present Public Market
- ------------------------
There is presently no public market for our common stock. We can provide no
assurance that our shares will be traded on any public market in the future.
Holders of Our Common Stock
- ---------------------------
As of the date of this registration statement, we have forty seven (47)
registered shareholders.
Dividends
- ---------
There are no restrictions in our articles of incorporation or bylaws that
restrict us from declaring dividends. The Nevada Revised Statutes, however, do
prohibit us from declaring dividends where, after giving effect to the
distribution of the dividend:
(1) we would not be able to pay our debts as they become due in the
usual course of business; or
(2) our total assets would be less than the sum of our total
liabilities, plus the amount that would be needed to satisfy the
rights of shareholders who have preferential rights superior to
those receiving the distribution.
We have not declared any dividends. We do not plan to declare any dividends in
the foreseeable future.
EXECUTIVE COMPENSATION
Mr. Ebert was issued 2,250,000 shares of our company at a deemed price of $0.001
per share in consideration for his services in organizing Cascadia and acting as
officer and director. Mr. Ebert purchased an additional 250,000 shares for cash
at $0.001 per share.
No other compensation has been awarded to, earned by or paid to our officers
and/or directors since our inception. Management has agreed to act without
compensation until authorized by the Board of Directors, which is not expected
to occur until we have generated revenues from operations. As of the date of
this registration statement, we have no funds available to pay officers or
directors. Further, our officers and director are not accruing any compensation
pursuant to any agreement with us.
24
- --------------------------------------------------------------------------------
- ----------------------------------------
SUMMARY COMPENSATION TABLE
- --------------------------------------------------------------------------------
- ----------------------------------------
Long Term Compensation
- --------------------------------------------------------------------------------
- ----------------------------------------
Annual Compensation
Awards Payouts
- --------------------------------------------------------------------------------
- ----------------------------------------
(a) (b) (c) (d) (e) (f)
(g) (h) (i)
- --------------------------------------------------------------------------------
- ----------------------------------------
Other
All
Annual
Restricted Securities Other
Name and Principle Comp- Stock
Underlying LTIP Comp-
Position Salary Bonus ensation Award(s)
Option/SARs Payouts ensation
Year ($) ($) ($) ($)
(#) ($) ($)
- --------------------------------------------------------------------------------
- ----------------------------------------
Keith A. Ebert, 1999/ $0.00 $0.00 $0.00 $0.00
0 $0.00 $0.00
President, C.F.O. and 2000
Director
- --------------------------------------------------------------------------------
- ----------------------------------------
Gerry Diakow, 1999/ $0.00 $0.00 $0.00 $0.00
0 $0.00 $0.00
Vice-President, 2000
Exploration and
Acquisitions
- --------------------------------------------------------------------------------
- ----------------------------------------
Stock Option Grants
- -------------------
We did not grant any stock options to any executive officers or directors during
our most recent fiscal year ended October 31, 2000. We have not granted any
stock options to any executive officers or directors since October 31, 2000.
Employment Agreements
- ---------------------
We do not have an employment or consulting agreement with either Mr. Keith
Ebert, our President, Secretary, C.F.O. and director or Mr. Gerry Diakow, our
Vice-President, Exploration and Acquisitions. Messrs. Ebert and Diakow provide
their services to us on an as needed basis. We do not pay any salary or
consulting fee to Messrs. Ebert and Diakow.
INDEPENDENT PUBLIC ACCOUNTANTS
Our audited financial statements for the year ended October 31, 2000 and the
related statements of loss and deficit, stockholders deficiency and cash flows
appearing in this prospectus, have been included herein in reliance on the
report of Davidson & Company, Chartered Accountants, given on the authority of
said firm as experts in accounting and auditing.
INDEX TO FINANCIAL STATEMENTS
1. Unaudited Financial Statements:
(a) Balance Sheet as of April 30, 2001
(b) Statement of Loss and Deficit for the period ending April 30, 2001
(c) Statement of Cash Flows for the period ending April 30, 2001
(d) Statement of Stockholders Equity for the period ending April 30,
2001
(e) Notes to Audited Financial Statements
25
CASCADIA CAPITAL CORPORATION
(AN EXPLORATION STAGE COMPANY)
FINANCIAL STATEMENTS
(EXPRESSED IN UNITED STATES DOLLARS)
(UNAUDITED)
APRIL 30, 2001
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
BALANCE SHEET
(Expressed in United States Dollars)
(Unaudited)
================================================================================
====================================================
April 30, October 31,
2001 2000
- --------------------------------------------------------------------------------
- ----------------------------------------------------
ASSETS
CURRENT
Cash and cash equivalents
$ 10,870 $ 22,398
================================================================================
====================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT
Accounts payable and accrued liabilities
$ 1,100 $ 2,500
-------- --------
STOCKHOLDERS' EQUITY
Capital stock (Note 4)
Authorized
100,000,000 common shares with a par value of $0.0001
Issued and outstanding
October 31, 2000 - 4,740,000 common shares
April 30, 2001 - 4,840,000 common shares
484 474
Additional paid-in capital
74,216 24,226
Deficit accumulated during the exploration stage
(64,930) (4,802)
-------- --------
9,770 19,898
-------- --------
$ 10,870 $ 22,398
================================================================================
====================================================
HISTORY AND ORGANIZATION OF THE COMPANY (Note 1)
GOING CONCERN (Note 2)
On behalf of the Board of Directors:
/s/ Keith A. Ebert
- -----------------------------
Keith A. Ebert, Director
The accompanying notes are an integral part of these financial statements
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
STATEMENT OF OPERATIONS
(Expressed in United States Dollars)
(Unaudited)
================================================================================
====================================================
Cumulative
Amounts
From
Incorporation
on
October 29, Three Month
Three Month Six Month Six Month
1999 to Period Ended
Period Ended Period Ended Period Ended
April 30, April 30,
April 30, April 30, April 30,
2001 2001
2000 2001 2000
- --------------------------------------------------------------------------------
- ----------------------------------------------------
EXPENSES
Consulting fees $ 4,780 $ 4,780
$ -- $ 4,780 $ --
Filing and transfer agent fees 2,869 1,927
-- 2,869 --
Mineral property acquisition costs 50,000 --
-- 50,000 --
Office and miscellaneous 2,581 166
26 279 2,232
Professional fees 4,700 2,200
1,500 2,200 1,500
----------- -----------
----------- ----------- -----------
LOSS FOR THE PERIOD $ (64,930) $
(9,073) $ (1,526) $ (60,128) $ (3,732)
================================================================================
====================================================
BASIC AND DILUTED LOSS PER SHARE $
(0.01) $ (0.01) $ (0.01) $ (0.01)
================================================================================
====================================================
WEIGHTED AVERAGE SHARES
OUTSTANDING 4,840,000
4,700,000 4,832,221 4,700,000
================================================================================
====================================================
The accompanying notes are an integral part of these financial statements
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
(Expressed in United States Dollars)
(Unaudited)
================================================================================
====================================================
Common Stock
- ------------------------------- Deficit
Number
Accumulated Total
of Shares
Additional During the Stock-
Issued and
Paid-in Exploration holders'
Outstanding
Amount Capital Stage Equity
- --------------------------------------------------------------------------------
- ----------------------------------------------------
INCEPTION, OCTOBER 29, 1999 -- $
- -- $ -- $ -- $ --
Common shares issued for
services 2,250,000
225 2,025 -- 2,250
Common shares issued for cash 2,450,000
245 2,205 -- 2,450
Common shares issued for cash 40,000
4 19,996 -- 20,000
Net loss for the period --
- -- -- (4,802) (4,802)
---------
- --------- --------- --------- ---------
BALANCE, OCTOBER 31, 2000 4,740,000 $
474 $ 24,226 $ (4,802) $ 19,898
Common shares issued for
mineral claims option 100,000
10 49,990 -- 50,000
Net loss for the period --
- -- -- (60,128) (60,128)
---------
- --------- --------- --------- ---------
BALANCE, APRIL 30, 2001 4,840,000 $
484 $ 74,216 $ (64,930) $ 9,770
================================================================================
====================================================
The accompanying notes are an integral part of these financial statements
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
STATEMENT OF CASH FLOWS
(Expressed in United States Dollars)
(Unaudited)
================================================================================
====================================================
Cumulative
Amounts
From
Incorporation
on
October 29, Six Month Six Month
1999 to Period Ended Period Ended
April 30, April 30, April 30,
2001 2001 2000
- --------------------------------------------------------------------------------
- ----------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the period
$(64,930) $(60,128) $ (3,732)
Items not affecting cash:
Common shares allotted for services
2,250 -- 2,250
Common shares issued for mineral claims option
50,000 50,000 --
Changes in non-cash working capital items:
Increase (decrease) in accounts payable and accrued liabilities
1,100 (1,400) 1,500
-------- -------- --------
Net cash provided by (used in) operating activities
(11,580) (11,528) 18
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of shares
20,000 -- --
Share subscriptions received in advance
2,450 -- 2,450
-------- -------- --------
Net cash provided by financing activities
22,450 -- 2,450
-------- -------- --------
CHANGE IN CASH POSITION DURING THE PERIOD
10,870 (11,528) 2,468
CASH POSITION, BEGINNING OF THE PERIOD
-- 22,398 --
-------- -------- --------
CASH POSITION, END OF THE PERIOD
$ 10,870 $ 10,870 $ 2,468
================================================================================
====================================================
SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS:
Cash paid for income taxes
$ -- $ --
Cash paid for interest
-- --
================================================================================
====================================================
SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES:
Common shares allotted for services
$ 2,250 $ -- $ 2,250
Common shares issued for mineral claims option
50,000 50,000 --
================================================================================
====================================================
The accompanying notes are an integral part of these financial statements
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
APRIL 30, 2001
================================================================================
1. HISTORY AND ORGANIZATION OF THE COMPANY
The Company was incorporated on October 29, 1999 under the laws of the
State of Nevada to engage in any lawful business or activity for which
corporations may be organized under the laws of the State of Nevada and
effectively started its operations on November 1, 1999. The Company is
in the business of exploration and development of mineral properties
and has not yet determined whether its properties contain mineral
resources that may be economically recoverable. The Company therefore
has not reached the development stage and is considered to be an
exploration stage company.
The accompanying financial statements have been prepared by the Company
without audit. In the opinion of management, all adjustments (which
include only normal recurring adjustments) necessary to present fairly
the financial position, results of operations, changes in stockholders'
equity and cash flows at April 30, 2001 and for the periods then ended
have been made. These financial statements should be read in
conjunction with the audited financial statements of the Company for
the year ended October 31, 2000. The results of operations for the
period ended April 30, 2001 are not necessarily indicative of the
results to be expected for the year ending October 31, 2001.
2. GOING CONCERN
These financial statements have been prepared in accordance with
generally accepted accounting principles applicable to a going concern
which contemplates the realization of assets and the satisfaction of
liabilities and commitments in the normal course of business. The
general business strategy of the Company is to acquire mineral
properties either directly or through the acquisition of operating
entities. The continued operations of the Company and the
recoverability of mineral property costs is dependent upon the
existence of economically recoverable reserves, confirmation of the
Company's interest in the underlying mineral claims, the ability of the
Company to obtain necessary financing to complete the development and
upon future profitable production. The Company has incurred operating
losses and requires additional funds to meet its obligations and
maintain its operations. Management's plan in this regard is to raise
equity financing as required. These conditions raise substantial doubt
about the Company's ability to continue as a going concern. These
financial statements do not include any adjustments that might result
from this uncertainty.
==============================================================================
April 30,
October 31,
2001
2000
- ------------------------------------------------------------------------------
Deficit accumulated during the exploration stage $ (64,930) $
(4,802)
Working capital 9,770
19,898
==============================================================================
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
APRIL 30, 2001
================================================================================
3. SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amount of assets and
liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amount of revenues
and expenses during the period. Actual results could differ from these
estimates.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents include highly liquid investments with
original maturities of three months or less.
RESOURCE PROPERTIES
Costs of acquisition, exploration, carrying, and retaining unproven
properties are expensed as incurred. Costs incurred in proving and
developing a property ready for production are capitalized and
amortized over the life of the mineral deposit or over a shorter period
if the property is shown to have an impairment in value.
ENVIRONMENTAL REQUIREMENTS
At the report date, environmental requirements related to mineral
claims acquired (Note 5) are unknown and therefore an estimate of any
future cost cannot be made.
INCOME TAXES
Income taxes are provided in accordance with Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes". A deferred
tax asset or liability is recorded for all temporary differences
between financial and tax reporting and net operating loss
carryforwards. Deferred tax expenses (benefit) result from the net
change during the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the
opinion of management, it is more likely than not that some portion or
all of the deferred tax assets will not be realized. Deferred tax
assets and liabilities are adjusted for the effects of changes in tax
laws and rates on the date of enactment.
ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
In June 1998, the FASB issued SFAS No. 133 "Accounting for Derivative
Instruments and Hedging Activities" which establishes accounting and
reporting standards for derivative instruments and for hedging
activities. SFAS 133 is effective for all fiscal quarters of fiscal
years beginning after June 15, 1999. In June 1999, the FASB issued SFAS
137 to defer the effective date of SFAS 133 to fiscal quarters of
fiscal years beginning after June 15, 1999. In June 2000, the FASB
issued SFAS No. 138, which is a significant amendment to SFAS 133. The
Company does not anticipate that the adoption of these statements will
have a significant impact on its financial statements.
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
APRIL 30, 2001
================================================================================
3. SIGNIFICANT ACCOUNTING POLICIES (cont'd.....)
COMPREHENSIVE INCOME
The Company has adopted Statement of Financial Accounting Standards No.
130 ("SFAS 130"), "Reporting Comprehensive Income". This statement
establishes rules for the reporting of comprehensive income and its
components. The adoption of SFAS 130 had no impact on total
stockholders' equity as of April 30, 2001.
STOCK-BASED COMPENSATION
Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation," encourages, but does not require, companies
to record compensation cost for stock-based employee compensation plans
at fair value. The Company has chosen to account for stock-based
compensation using Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees." Accordingly compensation
cost for stock options is measured as the excess, if any, of the quoted
market price of the Company's stock at the date of the grant over the
amount an employee is required to pay for the stock.
LOSS PER SHARE
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, "Earnings Per
Share" ("SFAS 128"). Under SFAS 128, basic and diluted earnings per
share are to be presented. Basic earnings per share is computed by
dividing income available to common shareholders by the weighted
average number of common shares outstanding during the year. Diluted
earnings per share takes into consideration common shares outstanding
(computed under basic earnings per share) and potentially dilutive
common shares.
4. CAPITAL STOCK
During the period, the Company issued 100,000 common shares under
Regulation S of the Securities Act of 1933 at a deemed price of $0.50
per share to the optionor of the mineral claims (Note 5b(i)).
5. MINERAL CLAIMS
On October 21, 2000, the Company entered into an option agreement to
acquire a 100% undivided interest in certain mining claims known as the
Thibert Creek Mining properties located in the Liard Mining Division of
British Columbia. As the claims do not contain any known reserves, the
acquisition costs will be expensed as incurred. To exercise its option,
the Company must:
a) Pay the optionor the sum of $50,000 as follows:
i) $25,000 on or before December 31, 2001; and
ii) an additional $25,000 on or before December 21, 2002.
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
APRIL 30, 2001
================================================================================
5. MINERAL PROPERTY (cont'd...)
b) Issue to the optionor a total of 1,000,000 common shares of the
Company as follows:
i) 100,000 shares at a deemed price of $0.50 (Note 4);
ii) 200,000 shares upon the completion of a first phase of a work
program on the property;
iii) 200,000 shares upon the completion of a second phase of a work
program on the property; and
iv) 500,000 shares upon the completion of a third phase of a work
program on the property.
c) Incur exploration expenditures of $100,000 on the property as
follows:
i) $10,000 on or before September 1, 2001;
ii) a further $40,000 on or before June 1, 2002; and
iii) a further $50,000 on or before December 31, 2002.
Upon commencement of production, the Company is subject to a 3% net
smelter returns royalty.
6. INCOME TAXES
For income tax purposes, the Company has a net operating loss
carryforward ("NOL") at April 30, 2001 of approximately $64,930
expiring in 2014 if not offset against future federal taxable income.
There may be certain limitations as to the future annual use of the
NOLs due to certain changes in the Company's ownership.
The Company has deferred tax assets of approximately $21,643 at April
30, 2001, resulting primarily from net operating loss carryforwards.
The deferred tax assets have been fully offset by a valuation allowance
resulting from the uncertainty surrounding their future realization.
Computed "expected" tax benefit $ 21,643
Decrease in tax benefit resulting from net operating loss
for which no benefit is currently available (21,643)
---------
$ --
=========
7. FINANCIAL INSTRUMENTS
The Company's financial instruments consist of cash and cash
equivalents, accounts payable and accrued liabilities. Unless otherwise
noted, it is management's opinion that the Company is not exposed to
significant interest, currency or credit risks arising from these
financial instruments. The fair value of these financial instruments
approximate their carrying values, unless otherwise noted.
1. Report of Independent Accountants
2. Audited Year End Financial Statements:
(a) Balance Sheet as of October 31, 2000
(b) Statement of Operations for year ended October 31, 2000
(c) Statement of Stockholders Equity for year ended October 31, 2000
(d) Statement of Cash Flows for year ended October 31, 2000
(e) Notes to Audited Financial Statements
CASCADIA CAPITAL CORPORATION
(AN EXPLORATION STAGE COMPANY)
FINANCIAL STATEMENTS
OCTOBER 31, 2000
DAVIDSON & COMPANY Chartered Accountants A Partnership of
Incorporated Professionals
-----
- ---------------------------------------------------------
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders of
Cascadia Capital Corporation
(An Exploration Stage Company)
We have audited the balance sheet of Cascadia Capital Corporation (An
Exploration Stage Company) as at October 31, 2000 and the related statements of
operations, changes in stockholders' equity and cash flows for the year then
ended. 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 United States generally accepted
auditing standards. Those standards require that we plan and perform an 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, these financial statements present fairly, in all material
respects, the financial position of the Company as at October 31, 2000 and the
results of its operations, changes in stockholders' equity and its cash flows
for the year then ended in accordance with United States 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 to the
financial statements, the Company has incurred a net loss since inception and
has had no revenues and has a minimal working capital position at October 31,
2000. These factors raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans in regard to these matters are
described in Note 2. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
"DAVIDSON & COMPANY"
Vancouver, Canada Chartered Accountants
November 22, 2000
A Member of SC INTERNATIONAL
Suite 1200, Stock Exchange Tower, 609 Granville Street, P.O. Box 10372,
Pacific Centre, Vancouver, BC, Canada, V7Y 1G6
TELEPHONE (604) 687-0947 FAX (604)
687-6172
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
BALANCE SHEET
AS AT OCTOBER 31, 2000
================================================================================
ASSETS
CURRENT
Cash and cash equivalents $ 22,398
================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT
Accounts payable and accrued liabilities $ 2,500
--------
Stockholders' equity
Capital stock (Note 4)
Authorized
100,000,000 common shares with a par value of $0.0001
Issued and allotted
4,740,000 common shares 474
Additional paid-in capital 24,226
Deficit accumulated during the exploration stage (4,802)
--------
19,898
$ 22,398
================================================================================
SUBSEQUENT EVENT (Note 9)
ON BEHALF OF THE BOARD:
/s/ Keith Ebert Director
- ----------------------------------------
Keith Ebert
The accompanying notes are an integral part of these financial statements
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 2000
================================================================================
EXPENSES
Office and miscellaneous $ 2,302
Professional fees 2,500
-----------
LOSS FOR THE YEAR $ 4,802
================================================================================
BASIC AND DILUTED LOSS PER SHARE $ (0.001)
================================================================================
WEIGHTED AVERAGE SHARES ISSUED, AND ALLOTTED 4,700,877
================================================================================
The accompanying notes are an integral part of these financial statements
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
================================================================================
====================================================
Common Stock
- -------------------------------- Deficit
Number
Accumulated Total
of Shares
Additional During the Stock-
Issued
Paid-in Exploration holders'
and Allotted Amount
Capital Stage Equity
- --------------------------------------------------------------------------------
- ----------------------------------------------------
BALANCE, OCTOBER 31, 1999 -- $ --
$ -- $ -- $ --
Common shares allotted for
services 2,250,000 225
2,025 -- 2,250
Common shares allotted for cash 2,450,000 245
2,205 -- 2,450
Common shares issued for cash 40,000 4
19,996 -- 20,000
Net loss for the year -- --
-- (4,802) (4,802)
--------- ---------
--------- --------- ---------
BALANCE, OCTOBER 31, 2000 4,740,000 $ 474
$ 24,226 $ (4,802) $ 19,898
================================================================================
====================================================
The accompanying notes are an integral part of these financial statements
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
STATEMENT OF CASH FLOWS
YEAR ENDED OCTOBER 31, 2000
================================================================================
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the year $ (4,802)
Item not affecting cash:
Common shares allotted for services 2,250
Changes in non-cash working capital items:
Increase in accounts payable and accrued liabilities 2,500
--------
Net cash used in operating activities (52)
--------
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of shares 20,000
Share subscriptions received in advance 2,450
--------
Net cash provided by financing activities 22,450
--------
CHANGE IN CASH POSITION DURING THE YEAR 22,398
CASH POSITION, BEGINNING OF THE YEAR --
--------
CASH POSITION, END OF THE YEAR $ 22,398
================================================================================
SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS:
Cash paid for income taxes $ --
Cash paid for interest --
================================================================================
SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES:
Common shares allotted for services $ 2,250
================================================================================
The accompanying notes are an integral part of these financial statements
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
OCTOBER 31, 2000
================================================================================
1. ORGANIZATION OF THE COMPANY
The Company was incorporated on October 29, 1999 under the laws of the
State of Nevada to engage in any lawful business or activity for which
corporations may be organized under the laws of the State of Nevada and
effectively started its operations on November 1, 1999. The Company is
in the business of exploration and development of mineral properties
and has not yet determined whether its properties contain mineral
resources that may be economically recoverable. The Company therefore
has not reached the development stage and is considered to be an
exploration stage company.
2. GOING CONCERN
These financial statements have been prepared in accordance with
generally accepted accounting principles applicable to a going concern
which contemplates the realization of assets and the satisfaction of
liabilities and commitments in the normal course of business. The
general business strategy of the Company is to acquire mineral
properties either directly or through the acquisition of operating
entities. The continued operations of the Company and the
recoverability of mineral property costs is dependent upon the
existence of economically recoverable reserves, confirmation of the
Company's interest in the underlying mineral claims, the ability of the
Company to obtain necessary financing to complete the development and
upon future profitable production. The Company has incurred operating
losses and requires additional funds to meet its obligations and
maintain its operations. Management's plan in this regard is to raise
equity financing as required. These conditions raise substantial doubt
about the Company's ability to continue as a going concern. These
financial statements do not include any adjustments that might result
from this uncertainty.
================================================================
2000
----------------------------------------------------------------
Deficit accumulated during the exploration stage $ (4,802)
Working capital 19,898
================================================================
3. SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amount of assets and
liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amount of revenues
and expenses during the period. Actual results could differ from these
estimates.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents include highly liquid investments with
original maturities of three months or less.
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
OCTOBER 31, 2000
================================================================================
3. SIGNIFICANT ACCOUNTING POLICIES (cont'd.....)
RESOURCE PROPERTIES
Costs of acquisition, exploration, carrying, and retaining unproven
properties are expensed as incurred. Costs incurred in proving and
developing a property ready for production are capitalized and
amortized over the life of the mineral deposit or over a shorter period
if the property is shown to have an impairment in value.
ENVIRONMENTAL REQUIREMENTS
At the report date, environmental requirements related to mineral
claims acquired (Note 5) are unknown and therefore an estimate of any
future cost cannot be made.
INCOME TAXES
Income taxes are provided in accordance with Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes". A deferred
tax asset or liability is recorded for all temporary differences
between financial and tax reporting and net operating loss
carryforwards. Deferred tax expenses (benefit) result from the net
change during the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the
opinion of management, it is more likely than not that some portion or
all of the deferred tax assets will not be realized. Deferred tax
assets and liabilities are adjusted for the effects of changes in tax
laws and rates on the date of enactment.
ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
In June 1998, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 133 ("SFAS 133"), "Accounting for
Derivative Instruments and Hedging Activities" which establishes
accounting and reporting standards for derivative instruments and for
hedging activities. SFAS 133 is effective for all fiscal quarters of
fiscal years beginning after June 15, 1999. In June 1999, the Financial
Accounting Standards Board issued SFAS 137 to defer the effective date
of SFAS 133 to fiscal quarters of fiscal years beginning after June 15,
2000. The Company does not anticipate that the adoption of the
statement will have a significant impact on its financial statements.
REPORTING ON COSTS OF START-UP ACTIVITIES
In April 1998, the American Institute of Certified Public Accountants
issued Statement of Position 98-5 ("SOP 98-5"), "Reporting on the Costs
of Start-Up Activities" which requires costs of start-up activities and
organization costs to be expensed as incurred. The adoption by the
Company of SOP 98-5 during the year resulted in the Company expensing
all startup costs.
COMPREHENSIVE INCOME
The Company has adopted Statement of Financial Accounting Standards No.
130 ("SFAS 130"), "Reporting Comprehensive Income". This statement
establishes rules for the reporting of comprehensive income and its
components. The adoption of SFAS 130 had no impact on total
stockholders' equity as of October 31, 2000.
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
OCTOBER 31, 2000
================================================================================
3. SIGNIFICANT ACCOUNTING POLICIES (cont'd.....)
STOCK-BASED COMPENSATION
Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation," encourages, but does not require, companies
to record compensation cost for stock-based employee compensation plans
at fair value. The Company has chosen to account for stock-based
compensation using Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees." Accordingly compensation
cost for stock options is measured as the excess, if any, of the quoted
market price of the Company's stock at the date of the grant over the
amount an employee is required to pay for the stock.
LOSS PER SHARE
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, "Earnings Per
Share" ("SFAS 128"). Under SFAS 128, basic and diluted earnings per
share are to be presented. Basic earnings per share is computed by
dividing income available to common shareholders by the weighted
average number of common shares outstanding during the year. Diluted
earnings per share takes into consideration common shares outstanding
(computed under basic earnings per share) and potentially dilutive
common shares.
4. CAPITAL STOCK
During the year, the Company entered into the following transactions
concerning its capital stock:
i) On November 1, 1999, the Company allotted 2,450,000 of its common
shares for proceeds of $2,450 and allotted 2,250,000 of its common
shares at a deemed value of $2,250 for services rendered.
ii) Issued 40,000 common shares, on October 23, 2000, under Regulation
S of the Securities Act of 1933 at a price of $0.50 per share for
total proceeds of $20,000.
5. MINERAL CLAIMS
On October 21, 2000, the Company entered into an option agreement to
acquire a 100% undivided interest in certain mining claims located in
the Liard Mining Division of British Columbia. As the claims do not
contain any known reserves, the acquisition costs will be expensed as
incurred. To exercise its option, the Company must:
a) Pay the optionor the sum of $50,000 as follows:
i) $25,000 on or before December 31, 2001; and
ii) an additional $25,000 on or before December 21, 2002.
b) Allot and issue to the optionor a total of 1,000,000 common shares
of the Company as follows:
i) 100,000 shares at a deemed price of $0.50 (Note 9);
ii) 200,000 shares upon the completion of a first phase of a work
program on the property;
iii) 200,000 shares upon the completion of a second phase of a
work program on the property; and
iv) 500,000 shares upon the completion of a third phase of a work
program on the property.
CASCADIA CAPITAL CORPORATION
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
OCTOBER 31, 2000
================================================================================
5. MINERAL PROPERTY (cont'd...)
c) Incur exploration expenditures of $100,000 on the property as
follows:
i) $10,000 on or before September 1, 2001;
ii) a further $40,000 on or before June 1, 2002; and
iii) a further $50,000 on or before December 31, 2002.
Upon commencement of production, the Company is subject to a 3% net
smelter returns royalty.
6. RELATED PARTY TRANSACTION
During the year ended October 31, 2000, the Company allotted 2,250,000
common shares at a deemed value of $2,250 to a director of the Company
in exchange for services rendered.
7. INCOME TAXES
For income tax purposes, the Company has a net operating loss
carryforward ("NOL") at October 31, 2000 of approximately $4,800
expiring in 2014 if not offset against future federal taxable income.
There may be certain limitations as to the future annual use of the
NOLs due to certain changes in the Company's ownership.
The Company has deferred tax assets of approximately $1,600 at October
31, 2000, resulting primarily from net operating loss carryforwards.
The deferred tax assets have been fully offset by a valuation allowance
resulting from the uncertainty surrounding their future realization.
Computed "expected" tax benefit $ 1,600
Decrease in tax benefit resulting from net operating loss
for which no benefit is currently available (1,600)
--------
$ --
========
8. FINANCIAL INSTRUMENTS
The Company's financial instruments consist of cash and cash
equivalents, accounts payable and accrued liabilities. Unless otherwise
noted, it is management's opinion that the Company is not exposed to
significant interest, currency or credit risks arising from these
financial instruments. The fair value of these financial instruments
approximate their carrying values, unless otherwise noted.
9. SUBSEQUENT EVENT
The Company issued 100,000 common shares, pursuant to an option
agreement, to acquire mineral claims (Note 5(b)(i)).
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
We have had no changes in or disagreements with our accountants since our
incorporation in October, 1999.
AVAILABLE INFORMATION
We are a reporting company and are subject to the reporting requirements of the
Exchange Act. We voluntarily filed a Form 10-SB on November 30, 2000. We have
filed a registration statement on Form SB-2 under the Act with the Securities
and Exchange Commission with respect to the shares of our common stock offered
by this prospectus. This prospectus is filed as a part of the registration
statement and does not contain all of the information contained in the
registration statement and exhibits and reference is hereby made to such omitted
information. Statements made in this registration statement are summaries of the
material terms of these referenced contracts, agreements or documents but are
not necessarily complete. However, all information we considered material
relating to the terms of any referenced contracts, agreements or documents has
been disclosed. Reference is made to each exhibit for a more complete
description of the matters involved and these statements shall be deemed
qualified in their entirety by the reference. You may inspect the registration
statement and exhibits and schedules filed with the Securities and Exchange
Commission at the Securities and Exchange Commission's principle office in
Washington, D.C. Copies of all or any part of the registration statement may be
obtained from the Public Reference Section of the Securities and Exchange
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549. The Securities and
Exchange Commission also maintains a web site (http://www.sec.gov) that contains
reports, proxy statements and information regarding registrants that file
electronically with the Commission. For further information pertaining to us and
our common stock offered by this prospectus, reference is made to the
registration statement.
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our officers and directors are indemnified as provided by the Nevada Revised
Statutes and our bylaws.
Under the NRS, director immunity from liability to a company or its shareholders
for monetary liabilities applies automatically unless it is specifically limited
by a company's articles of incorporation which is not the case with our articles
of incorporation. Excepted from that immunity are:
(1) a willful failure to deal fairly with the company or its shareholders in
connection with a matter in which the director has a material conflict of
interest;
(2) a violation of criminal law (unless the director had reasonable cause to
believe that his or her conduct was lawful or no reasonable cause to
believe that his or her conduct was unlawful);
(3) a transaction from which the director derived an improper personal profit;
and
(4) willful misconduct.
Our bylaws provide that we will indemnify our directors and officers to the
fullest extent not prohibited by Nevada law; provided, however, that we may
modify the extent of such indemnification by individual contracts with our
directors and officers; and, provided, further, that we shall not be required to
indemnify any director or officer in connection with any proceeding (or part
thereof) initiated by such person unless:
(1) such indemnification is expressly required to be made by law;
(2) the proceeding was authorized by our Board of Directors;
46
(3) such indemnification is provided by us, in our sole discretion, pursuant
to the powers vested us under Nevada law; or
(4) such indemnification is required to be made pursuant to the bylaws.
Our bylaws provide that we will advance to any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he is or was a director or officer, of Cascadia, or is
or was serving at the request of Cascadia as a director or executive officer of
another company, partnership, joint venture, trust or other enterprise, prior to
the final disposition of the proceeding, promptly following request therefor,
all expenses incurred by any director or officer in connection with such
proceeding upon receipt of an undertaking by or on behalf of such person to
repay said amounts if it should be determined ultimately that such person is not
entitled to be indemnified under our bylaws or otherwise.
Our bylaws provide that no advance shall be made by us to an officer of Cascadia
- --except by reason of the fact that such officer is or was a director of
Cascadia in which event this paragraph shall not apply-- in any action, suit or
proceeding, whether civil, criminal, administrative or investigative, if a
determination is reasonably and promptly made: (i) by the Board of Directors by
a majority vote of a quorum consisting of directors who were not parties to the
proceeding; or (ii) if such quorum is not obtainable, or, even if obtainable, a
quorum of disinterested directors so directs, by independent legal counsel in a
written opinion, that the facts known to the decision-making party at the time
such determination is made demonstrate clearly and convincingly that such person
acted in bad faith or in a manner that such person did not believe to be in or
not opposed to the best interests of Cascadia.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "Act") may be permitted to our directors, officers and controlling
persons, we have 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.
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated costs of the offering are denoted below. Please note that all
amounts are estimates other than the Commission's registration fee.
Securities and Exchange Commission registration fee: $275.00
Federal Taxes $0.00
State Taxes and Fees $0.00
Transfer Agent Fees $1,200.00
Accounting fees and expenses $2,000.00
Legal fees and expenses $2,000.00
Miscellaneous $1,000.00
TOTAL: $6,475.00
=========
We will pay all expenses of the offering listed above from cash on hand. No
portion of these expenses will be borne by the selling shareholders.
RECENT SALES OF UNREGISTERED SECURITIES
On November 1, 1999, we issued 2,450,000 common shares at $0.001 per share to 45
subscribers under Regulation S. None of the offerees or purchasers are U.S.
persons as defined in Rule 902(k) of Regulation S, and no sales efforts were
conducted in the U.S., in accordance with Rule 903(c). Subscribers to the
offering acknowledge that the securities purchased must come to rest outside the
U.S., and the certificates contain a legend restricting the sale of such
securities until the Regulation S holding period is satisfied in accordance with
Rule 903(b)(3)(iii)(A).
47
We issued 2,250,000 common shares at a deemed price of $0.001 per share to Mr.
Keith Ebert on November 1, 1999. Mr. Ebert was issued these shares in
consideration for his services in organizing the Company, acting as officer and
director and building our business plan. The value of the services rendered is
$2,250. We relied on the exemption contained in Regulation S of the Securities
Act of 1933.
On October 23, 2000, we issued 40,000 common shares at $0.50 per share to Mr.
Graham Crabtree under Regulation S. The purchaser is not a U.S. person as
defined in Rule 902(k) of Regulation S, and no sales efforts were conducted in
the U.S., in accordance with Rule 903(c). The subscriber to the offering
acknowledged that the securities purchased must come to rest outside the U.S.,
and the certificates contain a legend restricting the sale of such securities
until the Regulation S holding period is satisfied in accordance with Rule
903(b)(3)(iii)(A).
On November 16, 2000, we issued Mr. Gerry Diakow 100,000 common shares under
Regulation S of the Securities Act of 1933 in consideration for our option on
the Thibert Creek Properties. The purchaser is not a U.S. person as defined in
Rule 902(k) of Regulation S, and no sales efforts were conducted in the U.S., in
accordance with Rule 903(c). The subscriber to the offering acknowledged that
the securities purchased must come to rest outside the U.S., and the
certificates contain a legend restricting the sale of such securities until the
Regulation S holding period is satisfied in accordance with Rule
903(b)(3)(iii)(A).
On July 15, 2001, we issued 60,000 common shares at $0.50 per share to Mr.
Graham Crabtree under Regulation S. The purchaser is not a U.S. person as
defined in Rule 902(k) of Regulation S, and no sales efforts were conducted in
the U.S., in accordance with Rule 903(c). The subscriber to the offering
acknowledged that the securities purchased must come to rest outside the U.S.,
and the certificates contain a legend restricting the sale of such securities
until the Regulation S holding period is satisfied in accordance with Rule
903(b)(3)(iii)(A).
EXHIBITS
Item 27 Exhibits
3.1* Articles of Incorporation
3.2* Bylaws
5.1* Legal Opinion of Lanham & Associates
10.1* Mineral Option Agreement
10.2* Mineral Option Amendment Agreement
23.1* Consent of Davidson & Company
* Previously Filed
48
UNDERTAKINGS
Item 28 Undertakings
We undertake that we will:
1) File, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement to:
(i) Include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) Reflect in the prospectus any facts or events which, individually or
together, represent a fundamental change in the information in the
registration statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was
registered) any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a
20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement; and
(iii) Include any additional or changed material information on the plan
of distribution.
2) For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the bona
fide offering.
3) File a post-effective amendment to remove from registration any of the
securities that remain unsold at the end of the offering.
SIGNATURES
In accordance with 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 on Form SB-2 and authorized this registration
statement on Form SB-2 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Vancouver, Province of British Columbia, Canada,
on August 2, 2001.
CASCADIA CAPITAL CORPORATION
/s/Keith Ebert
--------------------------------------------
Keith Ebert, President,
Chief Financial Officer and Director
In accordance with the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates stated.
SIGNATURE TITLE DATE
- --------- ----- ----
/s/Keith Ebert President, C.F.O. August 2, 2001
- -------------- and Director
Keith Ebert
49