U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM SB-2/A
AMENDMENT NO. 2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
LASALLE RESOURCES, INC.
(Exact name of Registrant as specified in its charter)
(SEC File No. 333-88286)
NEVADA 1041 98-0370323
- ------ ---- ----------
(State or other jurisdiction Primary Standard (I.R.S. Employer
of incorporation or Industrial Classification Identification
organization) Number Number)
Grayson Hand, President
1859 Spyglass Place, Suite 414
Vancouver, British Columbia, Canada V5Z 4K6
- -------------------------------------- --------
(Name and address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code: (604) 872-4107
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
If this Form is filed to register additional 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 PROPOSED PROPOSED
CLASS OF MAXIMUM MAXIMUM
SECURITIES OFFERING AGGREGATE AMOUNT OF
TO BE AMOUNT TO BE PRICE PER OFFERING REGISTRATION
REGISTERED REGISTERED SHARE (1) PRICE (2) FEE (2)
- --------------------------------------------------------------------------------
Common Stock 4,532,000 shares $0.015 $67,980 $6.25
- --------------------------------------------------------------------------------
(1) Based on last sales price on February 28, 2002
(2) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457 under 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 STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY
DETERMINE.
COPIES OF COMMUNICATIONS TO:
Michael A. Cane, Esq.
2300 W. Sahara Blvd., Suite 500
Las Vegas, NV 89102
(702) 312-6255
Fax: (702) 944-7100
Agent for service of process
SUBJECT TO COMPLETION, Dated September 6, 2002
PROSPECTUS
LASALLE RESOURCES, INC.
4,532,000 SHARES
COMMON STOCK
----------------
The selling shareholders named in this prospectus are offering all of our shares
of common stock offered through this prospectus. LaSalle Resources, Inc. will
not receive any proceeds from this offering. We have set an offering price for
these securities of $0.015 per share.
- --------------------------------------------------------------------------------
Proceeds to Selling Shareholders
Offering Price Commissions Before Expenses and Commissions
Per Share $0.015 Not Applicable $0.015
Total $67,980 Not Applicable $67,980
- --------------------------------------------------------------------------------
Our common stock is presently not traded on any market or securities exchange.
----------------
The purchase of the securities offered through this prospectus involves a high
degree of risk. SEE SECTION ENTITLED "RISK FACTORS" ON PAGES 6 - 9.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.
----------------
The Date Of This Prospectus Is: September 6, 2002
Table Of Contents
PAGE
----
Summary 4
Risk Factors
Risks Related To Our Financial Condition and Business Model
- --------------------------------------------------------------------
- - If we do not obtain additional financing,
our business will fail 6
- - There is substantial doubt about our ability to
continue as a going concern 6
- - If we do not conduct mineral exploration on our
mineral claims or pay fees in lieu of mineral
exploration, then our mineral claims will lapse 6
- - Because we have only recently commenced business
operations, we face a high risk of business failure 6
- - As we are a new mineral exploration company, there
is a high probability that our business will fail 7
- - Because we anticipate our operating expenses will
increase prior to our earning revenues, we may
never achieve profitability 7
- - Because of the speculative nature of exploration,
there is substantial risk that no commercially exploitable
minerals will be found and this business will fail 7
- - Because of the inherent dangers involved in mineral
exploration, there is a risk that we may incur liability
or damages as we conduct our business 7
- - Because access to our optioned mineral claims may
be restricted by inclement weather, we may be delayed
in our exploration efforts 7
- - If we exercise our option and we and Consolidated
Global Minerals fail to make the required payments to
R.T. Heard & Associates, we may lose our 70% interest
in the Prelude Lake mineral claims 7
Risks Related To Our Market and Strategy
- -----------------------------------------------
- - Because our sole executive officer has only agreed to
provide his services on a part-time basis, he may not
be able or willing to devote a sufficient amount
of time to our business operations, causing
our business to fail 8
- - Because our sole executive officer does not have
formal training specific to the technicalities of
mineral exploration, there is a higher risk our
business will fail 8
Risks Related To Legal Uncertainty
- --------------------------------------
- - Because we will be subject to compliance with
government regulation our anticipated cost of our
exploration program may increase 8
- - Because our mineral claims may be subject to native
land claims, there is a risk that native land claims
could adversely affect our property rights if we
acquire a 70% interest in the Prelude Lake mineral claims 8
Risks Related To This Offering
- -----------------------------------
- - Because there is no market for our shares and none
is likely, shareholders may be unable to sell their shares 9
Use of Proceeds 9
Determination of Offering Price 9
Dilution 9
Selling Shareholders 10
Plan of Distribution 15
Legal Proceedings 16
Directors, Executive Officers, Promoters and Control Persons 16
Security Ownership of Certain Beneficial Owners and Management 20
Description of Securities 20
Interest of Named Experts and Counsel 22
Disclosure of Commission Position of Indemnification
for Securities Act Liabilities 23
Organization Within Last Five Years 23
Description of Business 23
Plan of Operations 30
Description of Property 31
Certain Relationships and Related Transactions 32
Market for Common Equity and Related Stockholder Matters 32
Executive Compensation 35
Financial Statements 36
Changes in and Disagreements with Accountants 37
Available Information 37
Until ______, all dealers that effect transactions in these securities whether
or not participating in this offering, may be required to deliver a prospectus.
This is in addition to the dealer' obligation to deliver a prospectus when
acting as underwriters and with respect to their unsold allotments or
subscriptions.
3
Summary
LaSalle Resources, Inc.
We are in the business of mineral exploration. We have only recently commenced
our mineral exploration activities. We acquired an option to acquire a 70%
interest in three mineral claims located in the Prelude Lake area in the
Northwest Territories, Canada from Consolidated Global Minerals Ltd. on January
17, 2002. Consolidated Global Minerals Ltd. is a public company whose shares
are traded on the Canadian Venture Exchange. Mr. George Heard, one of our
directors, is a director and the president of Consolidated Global Minerals. We
refer to these mineral claims as the Prelude Lake mineral claims as they are in
the vicinity of the Prelude Lake, approximately forty-five kilometres from the
city of Yellowknife in the south-central Northwest Territories. We are
presently undertaking preliminary exploration work to search for economic
mineralization on these claims. We define economic mineralization as the
presence of mineralization on our mineral claims in sufficient quantity and
concentration and in an accessible location that would justify the commercial
extraction of these minerals through an operating mine.
Our plan of operations is to conduct mineral exploration activities on the
Prelude Lake mineral claims in order to assess whether these claims possess
commercially exploitable diamond and gold mineral reserves. We have commenced an
initial stage of exploration on our mineral properties. Our plan of operations
is to complete this initial stage of exploration. We will assess whether to
undertake further stages on our exploration program based on the recommendations
of a geological report that we plan to obtain on the initial stage of
exploration, once completed, and based on our ability to finance further
exploration. Our proposed exploration program is designed to explore for
commercially exploitable deposits of diamonds and gold minerals. We have not,
nor has any predecessor, identified any commercially exploitable reserves of
diamonds or gold on these mineral claims. We are an exploration stage company
and there is no assurance that a commercially viable mineral deposit exists on
our mineral claims.
Since we are in the exploration stage of our corporate development, we have not
yet earned any revenues from our planned operations. Our financial information
as of February 28, 2002, being the date of our latest balance sheet included
with this prospectus is summarized below:
Cash as at May 31, 2002 $70,416
----------------------- -------
Current Liabilities as at May 31, 2002 $22,997
-------------------------------------- -------
Working Capital as at May 31, 2002 $47,856
---------------------------------- -------
Net Loss from Inception to May 31, 2002 $27,124
--------------------------------------- -------
We attribute our net loss from inception to having no revenues to offset our
expenses from the acquisition and exploration of our optioned mineral claims and
the professional fees related to the creation and operation of our business. We
have sufficient funds to enable us to complete the initial phase of exploration
on our mineral claims. Should we decide to proceed with further exploration
based on the results of this initial phase of exploration, we will require
additional financing in order to pay for the expense of additional exploration
of our mineral claims.
We were incorporated on December 3, 2001 under the laws of the state of Nevada.
Our principal offices are located at Suite 414 - 1859 Spyglass Place, Vancouver,
British Columbia 98230. Our telephone number is (604) 872-4107.
The Offering
Securities Being Offered
Up to 4,532,000 shares of our common stock.
Offering Price and
Alternative Plan of Distribution
The offering price of the common stock is
$0.015 per share. We intend to apply to the
Over-The-Counter Bulletin Board to allow the
trading of our common stock upon our becoming
a reporting entity under the Securities
Exchange Act of 1934. If our common stock
becomes so traded and a market for the stock
develops, the actual price of stock will be
determined by prevailing market prices at the
time of sale or by private transactions
4
negotiated by the selling shareholders. The
offering price would thus be determined by
market factors and the independent decisions
of the selling shareholders.
Minimum Number of Shares
To Be Sold in This Offering
None.
Securities Issued
And to be Issued
11,532,000 shares of our common stock are
issued and outstanding as of the date of this
prospectus. All of the common stock to be
sold under this prospectus will be sold by
existing shareholders.
Use of Proceeds We will not receive any proceeds from the sale of our common
stock by the selling shareholders.
5
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 before investing in our common stock. If any of the following risks
occur, our business, operating results and financial condition could be
seriously harmed. The trading price of our common stock could decline due to any
of these risks, and you may lose all or part of your investment.
Risks Related To Our Financial Condition And Business Model
IF WE DO NOT OBTAIN ADDITIONAL FINANCING, OUR BUSINESS WILL FAIL.
Our current operating funds are adequate to complete the initial phase of
exploration of our mineral claims. As of May 31, 2002, we had cash in the amount
of $70,416. We have commenced undertaking the initial phase of exploration and
we have no income. Our business plan calls for significant expenses in
connection with the exploration of our mineral claims, and the development of
these mineral claims if our exploration indicates that our mineral claims
possess commercially exploitable mineral reserves. While we have sufficient
funds to carry out the first phase of the recommended exploration program on the
Prelude Lake mineral claim, we will require additional financing in order to
complete a more extensive exploration program. We will also require additional
financing if the costs of the exploration of our optioned mineral claim are
greater than anticipated. If our exploration programs are successful in
discovering ore of commercial tonnage and grade, we will require additional
funds in order to place the Prelude Lake mineral claim into commercial
production. We will require additional financing to sustain our business
operations if we are not successful in earning revenues once exploration is
complete. We currently do not have any arrangements for financing and we can
provide no assurance to investors that we will be able to obtain financing when
required. Obtaining additional financing would be subject to a number of
factors, the known material factors being market prices for diamonds and gold,
investor acceptance of our mineral claims, and investor sentiment. These
factors may make the timing, amount, terms or conditions of additional financing
unavailable to us. See discussion of our exploration program under the heading,
"Description of Business."
THERE IS SUBSTANTIAL DOUBT ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN.
We have incurred a net loss of $8,612 for the period from December 3, 2001
(inception) to May 31, 2002, and have no revenues. We incurred a net loss of
$27,124 for the period from December 3, 2001 (inception) to May 31, 2002. Our
future is dependent upon our ability to obtain financing and upon future
profitable operations from the development of our mineral properties. We plan
to seek additional capital through private placements of our common stock. Our
financial statements do not include any adjustments relating to the
recoverability and classification of recorded assets, or the amounts of and
classification of liabilities that might be necessary in the event we cannot
continue in existence.
Our auditors have made reference to the substantial doubt about our ability to
continue as a going concern in their audit report on our audited financial
statements for the period ended February 28, 2002.
IF WE DO NOT CONDUCT MINERAL EXPLORATION ON OUR MINERAL CLAIMS OR PAY FEES IN
LIEU OF MINERAL EXPLORATION, THEN OUR MINERAL CLAIMS WILL LAPSE.
We must complete mineral exploration work on our Prelude Lake mineral claims and
make filings with the Canadian regulatory authorities regarding the work
completed or pay filing fees in lieu of completing work on our claims. If we do
not conduct any mineral exploration on our claims or make the required payments
in lieu of completing mineral exploration, then our claims will lapse and we
will lose all interest that we have in these mineral claims. The expiration
dates of the mineral claims are currently June 21, 2005 and January 14, 2006.
BECAUSE WE HAVE ONLY RECENTLY COMMENCED BUSINESS OPERATIONS, WE FACE A HIGH RISK
OF BUSINESS FAILURE.
We have just begun the initial stages of exploration of our mineral claims, and
thus have no way to evaluate the likelihood that we will be able to operate the
business successfully. We were incorporated on December 3, 2001 and to date
have been involved primarily in organizational activities, the acquisition of
the option to acquire
6
the Prelude Lake mineral claims, obtaining a geological report on our mineral
claims and initiating the first phase of exploration. We have not earned any
revenues as of the date of this prospectus. We face a high risk of business
failure as a result of these factors.
BECAUSE WE ANTICIPATE OUR OPERATING EXPENSES WILL INCREASE PRIOR TO OUR EARNING
REVENUES, WE MAY NEVER ACHIEVE PROFITABILITY.
Prior to completion of our exploration stage, we anticipate that we will incur
increased operating expenses without realizing any revenues. We therefore
expect to incur significant losses into the foreseeable future. We recognize
that if we are unable to generate significant revenues from the exploration of
our mineral claims and the production of minerals thereon, if any, we will not
be able to earn profits or continue operations. There is no history upon which
to base any assumption as to the likelihood that we will prove successful, and
we can provide investors with no assurance that we will generate any operating
revenues or ever achieve profitable operations. If we are unsuccessful in
addressing these risks, our business will most likely fail.
BECAUSE OF THE SPECULATIVE NATURE OF EXPLORATION, THERE IS SUBSTANTIAL RISK THAT
NO COMMERCIALLY EXPLOITABLE MINERALS WILL BE FOUND AND THIS BUSINESS WILL FAIL.
The search for valuable minerals as a business is extremely risky. We can
provide investors with no assurance that our mineral claims contain commercially
exploitable reserves of diamonds and gold. Exploration for minerals is a
speculative venture necessarily involving substantial risk. The expenditures to
be made by us in the exploration of the mineral claims may not result in the
discovery of commercial quantities of ore. Problems such as unusual or
unexpected formations and other conditions are involved in mineral exploration
and often result in unsuccessful exploration efforts. In addition, we face the
risk that our planned exploration program may cost more to complete than
budgeted. These factors could cause us to be unable to complete our business
plan. Our business will fail if we are not able to earn revenues of substantiate
that the Prelude Lake mineral claims host commercially exploitable reserves of
diamonds or gold.
BECAUSE OF THE INHERENT DANGERS INVOLVED IN MINERAL EXPLORATION, THERE IS A RISK
THAT WE MAY INCUR LIABILITY OR DAMAGES AS WE CONDUCT OUR BUSINESS.
The search for valuable minerals involves numerous hazards. As a result, we may
become subject to liability for such hazards, including pollution, cave-ins and
other hazards against which we cannot insure or against which we may elect not
to insure. The payment of such liabilities may have a material adverse effect
on our financial position. We do not have any insurance that would cover these
potential liabilities.
BECAUSE ACCESS TO OUR OPTIONED MINERAL CLAIMS MAY BE RESTRICTED BY INCLEMENT
WEATHER, WE MAY BE DELAYED IN OUR EXPLORATION EFFORTS.
Access to the Prelude Lake mineral claim will be restricted through some of the
year due to weather in the area. The Prelude Lake mineral claims are located on
the Canadian shield and the land is characterized by many lakes and muskeg
conditions that make transportation and access difficulty unless the ground and
lakes are frozen, in the winter, or the ground is dry and free of snow, in the
summer. Accordingly, access to the claims is generally only available during
the summer and winter periods and is not available in spring break-up and fall
freeze-up periods. As a result, any attempt to test or explore the property is
largely limited to the times when weather permits such activities. These
limitations can result in significant delays in exploration efforts. Such
delays can have a significant negative effect on our results of operations.
IF WE EXERCISE OUR OPTION AND WE AND CONSOLIDATED GLOBAL MINERALS FAIL TO MAKE
THE REQUIRED PAYMENTS TO R.T. HEARD & ASSOCIATES, WE MAY LOSE OUR 70% INTEREST
IN THE PRELUDE LAKE MINERAL CLAIMS.
If we fulfill all the requirements in the option agreement and exercise our
option to acquire a 70% interest in the Prelude Lake mineral claims, we will own
our 70% interest in the Prelude Lake mineral claims subject to the obligation of
us and Consolidated Global Minerals to make required royalty payments to R.T.
Heard & Associates. These royalty payments include: an annual royalty in the
amount of $50,000 CDN (approximately $31,900 US as of September 6, 2002),
payable in two equal installments on May 27 and November 27 of each year;
payment of a 4% gross overriding royalty; and payment of a 2% net smelter
royalty. These royalty
7
payments will be apportioned between us and Consolidated Global Minerals in
accordance with our respective ownership interests in the Prelude Lake mineral
claims. If we and Consolidated Global Minerals are unable to make the required
royalty payments for any reason, including insufficient financial resources, we
would lose our interest in the Prelude Lake mineral claims.
Risks Related To Our Market and Strategy
BECAUSE OUR SOLE EXECUTIVE OFFICER HAS ONLY AGREED TO PROVIDE HIS SERVICES ON A
PART-TIME BASIS, HE MAY NOT BE ABLE OR WILLING TO DEVOTE A SUFFICIENT AMOUNT OF
TIME TO OUR BUSINESS OPERATIONS, CAUSING OUR BUSINESS TO FAIL.
Mr. Hand, our sole executive officer, provides his services on a part-time basis
averaging approximately 8 hours per week. Mr. Hand may pursue other business
activities, provided that these other activities do not interfere with his
obligations to us. Mr. Hand will devote much of his full-time attention to
other business pursuits. If the demands of our business require the full
business time of Mr. Hand, he is prepared to adjust his timetable to devote more
time to our business. However, there can be no assurance that Mr. Hand will be
able to devote sufficient time to the management of our business, as and when
needed.
BECAUSE OUR SOLE EXECUTIVE OFFICER DOES NOT HAVE FORMAL TRAINING SPECIFIC TO THE
TECHNICALITIES OF MINERAL EXPLORATION, THERE IS A HIGHER RISK OUR BUSINESS WILL
FAIL.
Mr. Hand, our sole executive officer, does not have formal training as a
geologist or in the technical aspects of management of a mineral exploration
company. In addition, Mr. Hand lacks technical training and experience with
exploring for, starting and operating a mine. This lack of training means that
our management may not be fully aware of many of the specific requirements
necessary to complete our planned exploration program and may make decisions and
choices that do not take into account standard engineering or managerial
approaches that are commonly used by mineral exploration companies.
Consequently, our operations, earnings, and ultimate financial success could
suffer irreparable harm due to our management's lack of experience in this
industry.
Risks Related To Legal Uncertainty
BECAUSE WE WILL BE SUBJECT TO COMPLIANCE WITH GOVERNMENT REGULATION, OUR
ANTICIPATED COST OF OUR EXPLORATION PROGRAM MAY INCREASE.
There are several governmental regulations that materially restrict the
exploration and extraction of minerals. We will be subject to the Canada
Department of Indian and Northern Affairs - Land Use Regulations and Canada
Mining Regulations as we carry out our exploration program. We may be required
to obtain land use permits and perform remediation work for any physical
disturbance to the land in order to comply with these regulations. There is
also a risk that new regulations could increase our costs of doing business and
prevent us from carrying our exploration program.
BECAUSE OUR MINERAL CLAIMS MAY BE SUBJECT TO NATIVE LAND CLAIMS, THERE IS A RISK
THAT NATIVE LAND CLAIMS COULD ADVERSELY AFFECT OUR PROPERTY RIGHTS IF WE ACQUIRE
A 70% INTEREST IN THE PRELUDE LAKE MINERAL CLAIMS.
If we are successful in earning a 70% ownership interest in the Prelude Lake
mineral claims, there is a risk that our ownership of these claims and rights to
explore these claims could be adversely impacted by native land claims. The
region of the Northwest Territories in which the mineral claims are located are
subject to land claims of the North Slave native peoples. No settlement has
been reached between the Canadian federal government, which administers the
Northwest Territories, and the North Slave native peoples. If a settlement with
native peoples or a court order in favor of native peoples grants native peoples
the rights to the land where the Prelude Lake mineral claims are located, there
is a risk that our mineral claims could be defeated with the result that we
would lose the right to further explore the Prelude Lake mineral claims.
8
Risks Related To This Offering
BECAUSE THERE IS NO MARKET FOR OUR SHARES AND NONE IS LIKELY, SHAREHOLDERS MAY
BE UNABLE TO SELL THEIR SHARES
There is currently no market for our common stock and we can provide no
assurance that a market will develop. We currently plan to apply for listing of
our common stock on the Over-The-Counter Bulletin Board upon the effectiveness
of the registration statement of which this prospectus forms a part. However,
we can provide investors with no assurance that our shares will be traded on the
bulletin board or, if traded, that a public market will materialize. If our
common stock is not traded on the bulletin board or if a public market for our
common stock does not develop, investors may not be able to re-sell the shares
of our common stock that they have purchased and may lose all of their
investment.
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 too much reliance on these forward-looking statements. Our
actual results are most likely to differ materially from those anticipated in
these forward-looking statements for many reasons, including the risks faced by
us described in this Risk Factors section and elsewhere in this prospectus.
Use Of Proceeds
We will not receive any proceeds from the sale of the common stock offered
through this prospectus by the selling shareholders.
Determination Of Offering Price
The $0.015 per share offering price of our common stock was arbitrarily chosen.
However, the selection of this particular price was influenced by the last sales
price from our most recent private offering of common stock that was $0.015 per
share. There is no relationship whatsoever between this price and our assets,
earnings, book value or any other objective criteria of value.
We intend to apply to the Over-The-Counter Bulletin Board for the trading of our
common stock upon our becoming a reporting entity under the Securities Exchange
Act of 1934. We intend to file a registration statement under the Exchange Act
concurrently with the effectiveness of the registration statement of which this
prospectus forms a part. If our common stock becomes so traded and a market for
the stock develops, the actual price of stock will be determined by prevailing
market prices at the time of sale or by private transactions negotiated by the
selling shareholders. The offering price would thus be determined by market
factors and the independent decisions of the 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.
9
Selling Shareholders
The selling shareholders named in this prospectus are offering all of the
4,532,000 shares of common stock offered through this prospectus. The shares
include were acquired by the selling shareholders from us in an offering that
was exempt from registration under Regulation S of the Securities Act of 1933
and completed on February 28, 2002.
The following table provides as of September 6, 2002, information regarding the
beneficial ownership of our common stock held by each of the selling
shareholders, including:
1. the number of shares owned by each prior to this offering;
2. the total number of shares that are to be offered by each;
3. the total number of shares that will be owned by each upon completion of
the offering;
4. the percentage owned by each upon completion of the offering; and
5. the identity of the beneficial holder of any entity that owns the shares.
- --------------------------------------------------------------------------------
Total
Number
Of Shares
To Be Total
Offered Shares
Shares For To Be Percent
Owned Selling Owned Upon Owned Upon
Prior Share- Completion Completion
To This holders Of This Of This
Name Of Selling Stockholder Offering Account Offering Offering
- --------------------------------------------------------------------------------
Lynelle Arsenault 2,000 2,000 NIL NIL
Suite 202 - 470 Granville Street
Vancouver, BC V6C 1V5
- --------------------------------------------------------------------------------
Cameron J. A. Barley 200,000 200,000 NIL NIL
2060 Gisby Street
West Vancouver, BC V7V 4N3
- --------------------------------------------------------------------------------
Hamish S.E. Barley 75,000 75,000 NIL NIL
2060 Gisby Street
West Vancouver, BC V7V 4N3
- --------------------------------------------------------------------------------
Meagan Barley 75,000 75,000 NIL NIL
2060 Gisby Street
West Vancouver, BC V7V 4N3
- --------------------------------------------------------------------------------
Kurt Bordian 2,000 2,000 NIL NIL
347, 101 - 1001 West Broadway
Vancouver, BC V6H 4E4
- --------------------------------------------------------------------------------
Eric Bowes 2,000 2,000 NIL NIL
2149 Prairie Avenue
Port Coquitlam, BC V3B 1V6
- --------------------------------------------------------------------------------
S. Lee Bryant 2,000 2,000 NIL NIL
2114 Nanton Avenue
Vancouver, BC V6L 3C7
- --------------------------------------------------------------------------------
10
Table Continued from page 10
- --------------------------------------------------------------------------------
Total
Number
Of Shares
To Be Total
Offered Shares
Shares For To Be Percent
Owned Selling Owned Upon Owned Upon
Prior Share- Completion Completion
To This holders Of This Of This
Name Of Selling Stockholder Offering Account Offering Offering
- --------------------------------------------------------------------------------
Kelly Buffett 2,000 2,000 NIL NIL
P.O. Box 471
Westville, NS B0K 2A0
- --------------------------------------------------------------------------------
James S. Christopher 75,000 75,000 NIL NIL
#5 - 681 West 57th Avenue
Vancouver, BC V6P 1R8
- --------------------------------------------------------------------------------
Ron Douglas Coutts 1,000 1,000 NIL NIL
700 Hamilton Street, Suite 703
New Westminster, BC V3M 2M6
- --------------------------------------------------------------------------------
Marc Crimeni 1,000 1,000 NIL NIL
3322 Sophia Street
Vancouver, BC V5V 3T5
- --------------------------------------------------------------------------------
Ronald Crimeni 2,000 2,000 NIL NIL
6361 - 230th Street
Langley, BC V2Y 2L2
- --------------------------------------------------------------------------------
Dr. James DeMarco 425,000 425,000 NIL NIL
P.O. Box 1187
Whistler, BC V0N 1B0
- --------------------------------------------------------------------------------
Dr. Tom DeMarco 2,000 2,000 NIL NIL
P.O. Box 1187
Whistler, BC V0N 1B0
- --------------------------------------------------------------------------------
Tricia Dong 1,000 1,000 NIL NIL
#305 - 1666 Pendrell Street
Vancouver, BC V6G 1S9
- --------------------------------------------------------------------------------
Kenneth Dong 425,000 425,000 NIL NIL
402 - 2125 West 2nd Avenue
Vancouver, BC V6K 1H7
- --------------------------------------------------------------------------------
Douglas Wayne Durning 2,000 2,000 NIL NIL
R.R. #1,
Great Village, NS B0M 1L0
- --------------------------------------------------------------------------------
Wendy R. Fuller 2,000 2,000 NIL NIL
11650 94th Avenue
North Delta, BC V4C 3R6
- --------------------------------------------------------------------------------
11
Table Continued from page 11
- --------------------------------------------------------------------------------
Total
Number
Of Shares
To Be Total
Offered Shares
Shares For To Be Percent
Owned Selling Owned Upon Owned Upon
Prior Share- Completion Completion
To This holders Of This Of This
Name Of Selling Stockholder Offering Account Offering Offering
- --------------------------------------------------------------------------------
Allan B. Grainger 500,000 500,000 NIL NIL
10535 59th Avenue
Delta, BC V4K 3N3
- --------------------------------------------------------------------------------
Terry Heard 2,000 2,000 NIL NIL
1280 - 625 Howe Street
Vancouver, BC V6C 2T6
- --------------------------------------------------------------------------------
Virgil Z. Hlus 1,000 1,000 NIL NIL
2288 West 14th Avenue
Vancouver, BC V6K 2W1
- --------------------------------------------------------------------------------
Tarynne Hoover 200,000 200,000 NIL NIL
506 - 1245 Quayside Drive
New Westminster, BC V3M 6J6
- --------------------------------------------------------------------------------
International European Realty 500,000 500,000 NIL NIL
Limited
St. Andrews Court
Frederick Street Steps,
P.O. Box N-4805
Nassau, Bahamas
Beneficial Owner:
Hermann Josef Hermans
- --------------------------------------------------------------------------------
Kerrybrooke Farms Ltd. 375,000 375,000 NIL NIL
58 Harris Avenue
Truro, NS B2N 3N2
Beneficial Owner: [@]
- --------------------------------------------------------------------------------
Joseph W. Lewis 2,000 2,000 NIL NIL
601 - 655 Moberly Road
Vancouver, BC V5Z 4B2
- --------------------------------------------------------------------------------
Bill McGinty 375,000 375,000 NIL NIL
2114 Nanton Avenue
Vancouver, BC V6L 3C7
- --------------------------------------------------------------------------------
Ethan Minsky 1,000 1,000 NIL NIL
125 Boundary Road
Vancouver, BC V5K 4R6
- --------------------------------------------------------------------------------
12
Table Continued from page 12
- --------------------------------------------------------------------------------
Total
Number
Of Shares
To Be Total
Offered Shares
Shares For To Be Percent
Owned Selling Owned Upon Owned Upon
Prior Share- Completion Completion
To This holders Of This Of This
Name Of Selling Stockholder Offering Account Offering Offering
- --------------------------------------------------------------------------------
Tessa Mol 2,000 2,000 NIL NIL
9035 162A Street
Surrey, BC V4N 3L6
- --------------------------------------------------------------------------------
Sydney Morris 290,000 290,000 NIL NIL
P.O. Box N-4802
Nassau, Bahamas
- --------------------------------------------------------------------------------
Stephen F.X. O'Neill 2,000 2,000 NIL NIL
833 Sprice Avenue
Coquitlam, BC V3J 7R9
- --------------------------------------------------------------------------------
Edward E. Panos 200,000 200,000 NIL NIL
501 - 1675 E. Hornby Street
Vancouver, BC V6Z 2M3
- --------------------------------------------------------------------------------
Ron T. Paterson 2,000 2,000 NIL NIL
58 Harris Avenue
Truro, NS B2N 3N2
- --------------------------------------------------------------------------------
Mark Reynolds 1,000 1,000 NIL NIL
203 - 4323 Gallant Avenue
North Vancouver, BC V7G 2C1
- --------------------------------------------------------------------------------
Roy C. Smith 75,000 75,000 NIL NIL
519 Craigmohr Place
West Vancouver, BC V7S 1X3
- --------------------------------------------------------------------------------
Gerda Taylor 200,000 200,000 NIL NIL
#609, 1267 Marinaside Crescent
Vancouver, BC V6Z 2X5
- --------------------------------------------------------------------------------
Michael H. Taylor 2,000 2,000 NIL NIL
3171 Travers Avenue
West Vancouver, BC V7V 1G4
- --------------------------------------------------------------------------------
Robert G. Taylor 1,000 1,000 NIL NIL
2323 Aspen Court
Whistler, BC V0N 1B2
- --------------------------------------------------------------------------------
Christopher J. Watson 425,000 425,000 NIL NIL
502 - 655 Moberly Road
Vancouver, BC V5Z 4B2
- --------------------------------------------------------------------------------
13
Table Continued from page 13
- --------------------------------------------------------------------------------
Total
Number
Of Shares
To Be Total
Offered Shares
Shares For To Be Percent
Owned Selling Owned Upon Owned Upon
Prior Share- Completion Completion
To This holders Of This Of This
Name Of Selling Stockholder Offering Account Offering Offering
- --------------------------------------------------------------------------------
William James Whyte 2,000 2,000 NIL NIL
#508 - 619 Moberly Road
Vancouver, BC V5Z 4B1
- --------------------------------------------------------------------------------
John Williamson
4481 Skyline Drive
North Vancouver, BC V7R 3H4 75,000 75,000 NIL NIL
- --------------------------------------------------------------------------------
Pamela Williamson 2,000 2,000 NIL NIL
4481 Skyline Drive
North Vancouver, BC V7R 3H4
- --------------------------------------------------------------------------------
Terry Woo 1,000 1,000 NIL NIL
5th Floor - 1114 Alberni Street
Vancouver, BC V6E 1A5
- --------------------------------------------------------------------------------
The named party beneficially owns and has sole voting and investment power over
all shares or rights to these shares, unless otherwise shown in the table. The
numbers in this table assume that none of the selling shareholders sells shares
of common stock not being offered in this prospectus or purchases additional
shares of common stock, and assumes that all shares offered are sold. The
percentages are based on 11,532,000 shares of common stock outstanding on
September 6, 2002.
Except as described below, none of the selling shareholders:
(1) has had a material relationship with us other than as a shareholder at
any time within the past three years; or
(2) has ever been one of our officers or directors.
Mr. Terry Heard is the adult brother of Mr. George Heard, one of
our directors.
14
Plan Of Distribution
The selling shareholders 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 is fixed at $0.015 per share until such time as
the shares of our common stock become traded on the Over-The-Counter Bulletin
Board or another exchange. Although we intend to apply for trading of our
common stock on the Over-The-Counter Bulletin Board, public trading of our
common stock may never materialize. If our common stock becomes traded on the
Over-The-Counter Bulletin Board or another exchange, then the sales price to the
public will vary according to the selling decisions of each selling shareholder
and the market for our stock at the time of resale. In these circumstances, the
sales price to the public may be:
1. The market price of our common stock prevailing at the time of sale;
2. A price related to such prevailing market price of our common stock; or
3. Such other price as the selling shareholders determine from time to time.
The shares may also be sold in compliance with the Securities and Exchange
Commission's Rule 144.
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 such
transactions as agent may receive a commission from the selling shareholders,
or, if they act as agent for the purchaser of such common stock, from such
purchaser. The selling shareholders will likely pay the usual and customary
brokerage fees for such 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 such 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
such re-sales may pay or receive commissions to or from the purchasers of such
shares. These transactions may involve cross and block transactions that may
involve sales to and through other brokers or dealers. If applicable, the
selling shareholders may distribute shares to one or more of their partners who
are unaffiliated with us. Such partners may, in turn, distribute such shares as
described above. We can provide no assurance that all or any of the common stock
offered will be sold by the selling shareholders.
We are bearing all costs relating to the registration of the common stock,
including the costs of the preparation of the registration statement of which
this prospectus forms a part. We estimate these offering costs to be paid by us
on behalf of the selling shareholders to be $25,023. The selling shareholders,
however, will pay any commissions or other fees payable to brokers or dealers in
connection with any sale of the common stock. The selling shareholders must
comply with the requirements of the Securities Act of 1933 and the Securities
Exchange Act in the offer and sale of the 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.
15
Legal Proceedings
We are not currently a party to any legal proceedings.
Our agent for service of process in Nevada is Michael A. Cane, Esq., Cane &
Company, LLC, 2300 West Sahara Avenue, Suite 500, Box 18, Las Vegas, Nevada
89102.
Directors, Executive Officers, Promoters And Control Persons
Our executive officers and directors and their respective ages as of September
6, 2002 are as follows:
Directors:
Name of Director Age
- ---------------------- ---
Grayson Hand 65
George Heard 51
Executive Officers:
Name of Officer Age Office
- -------------------- --- -------
Grayson Hand 65 President, Secretary and Treasurer
Set forth below is a brief description of the background and business experience
of our sole executive officer and our directors for the past five years.
Mr. Grayson Hand is our president, secretary and treasurer and is one of our
directors. Mr. Hand was appointed as our president, secretary and treasurer and
as a director on December 3, 2001.
From July 1995 through January 1997, Mr. Hand served as president and as a
director of Leigh Resources Corporation (LRC), now known as Upland Resources
Corp., a publicly traded company on the Canadian Venture Exchange. During his
tenure as president, LRC was engaged primarily in mineral exploration. As
president, Mr. Hand supervised mineral exploration, negotiated joint venture
agreements for mineral exploration, hired drilling contractors and geologists
and was responsible for company financing. From January 1997 through February
1999, Mr. Hand continued to serve as a director of LRC. During the period of
Mr. Hand's involvement as an officer and director of LRC, LRC spent in excess of
$5,000,000 on gold exploration in Ghana, Africa and in the Solomon Islands.
Gold exploration in Ghana was abandoned due to the declining price of gold.
Gold exploration in the Solomon Islands was involuntarily halted due to a
government coup that has destabilized the region. The shares of Upland
Resources continue to trade on the TSX Venture Exchange. The closing price for
Upland Resources was $0.25 CDN per share (equal to approximately $0.15 per
share) on August 19, 2002.
From October 1996, Mr. Hand has served as a director of Clan Resources Ltd.,
also a company engaged in mineral exploration and publicly traded on the TSX
Venture Exchange. Clan Resources has been involved in the business of oil and
gas exploration since Mr. Hand joined the board of directors. Clan Resources
did not complete any drilling activity until 2001 due to low oil and gas prices.
During 2001, Clan was a participant in the drilling of two prospective oil wells
in the Province of Alberta, Canada. Neither of these wells was successful.
Clan is currently pursuing the acquisition of either a mineral exploration or an
oil or gas exploration property. Mr. Hand does not own any shares of Clan
Resources and is not actively involvement in the management of Clan Resources.
The shares of Clan Resources continue to trade on the TSX Venture Exchange. The
closing price for Clan Resources was $0.20 CDN per share (equal to approximately
$0.12 per share) on July 25, 2002.
From 1999 through September 2000, Mr. Hand served as the president and as a
director of Adventure Minerals Inc. Mr. Hand was a principal shareholder of
Adventure Minerals during the time that he was an officer and director of
Adventure Minerals. Adventure Minerals became a reporting company under the
provisions of the Securities Exchange Act of 1934 and was engaged in the
business of mineral exploration during the time of Mr.
16
Hand's involvement with the Company. Subsequent to becoming a reporting company,
Adventure Minerals conducted an exploration program of a prospective gold
property in the Kukagami Lake region of the Province of Ontario, Canada. Based
on results of this exploration program, Adventure Minerals determined that the
property did not warrant further exploration and exploration activities were
abandoned. Adventure Minerals acquired a development stage company with its core
business focused of technologies and services for recycling of waste materials
and changed its name to Planet Earth Recycling Inc. in connection with this
acquisition. Mr. Hand resigned as a director and officer in connection with the
acquisition of this new business and did not have any involvement with the new
business. The shares of Planet Earth Recycling currently trade on the pink sheet
market and the closing price of Planet Earth Recycling was $0.02 per share on
August 20, 2002.
From September 2000 to September 2001, Mr. Hand was the president and a director
of Commodore Minerals. Mr. Hand was a principal shareholder of Commodore
Minerals during the time in which he was an officer and director of Commodore.
Commodore Minerals became a reporting company under the provisions of the
Securities Exchange Act of 1934 and was engaged in the business of mineral
exploration during the time of Mr. Hand's involvement with the Company.
Subsequent to becoming a reporting company, Commodore Minerals conducted a gold
exploration program on a property in the Cariboo Mining Division of the Province
of British Columbia, Canada. Commodore Minerals concluded based on the results
of this exploration program that the results of the property did not warrant
further exploration and exploration activities were abandoned. Mr. Hand sold
his interest in Commodore Minerals subsequent to this determination. After Mr.
Hand resigned as a director and officer, Commodore Minerals acquired Intac
International Holdings Inc. from private individuals and became engaged in the
business of the distribution of wireless handsets in the global wireless
telecommunications marketplace. Commodore Minerals subsequently changed its
name to Intac International Inc. to reflect this acquisition. Mr. Hand did not
have any involvement with this new business. The shares of Intac International
continue to trade on the OTC Bulletin Board. The closing price of Intac
International was $5.70 per share on August 20, 2002.
Mr. Hand was a director of VirtualSellers.com, a company engaged in Internet
electronic commerce from March 2000 to September 2001. During Mr. Hand's
involvement with VirtualSellers.com, the company was involved in the business of
the development of software to facilitate business to business and business to
consumer transactions via the Internet. The business assets included a
call-centre based on in Chicago that facilitated live interaction between
transaction participants. VirtualSellers.com acquired Healthtrac Corporation in
August 2001 by way of a merger transaction. Healthtrac Corporation is involved
in the business of health care information. The decision by VirtualSellers.com
to acquire Healthtrac was due to the lack of profitability of the Internet
e-commerce business and the inability to continue to fund this business in the
prevailing market for Internet stocks. The corporate name of VirtualSellers.com
was subsequently changed to Healthtrac, Inc. The shares of Healthtrac continue
to trade on the OTC Bulletin Board. Healthtrac continues to manage the
call-centre originally established for the VirtualSellers.com business. In
addition, a number of the original directors of VirtualSellers.com remain on the
board of directors. Mr. Hand was an outside director of VirtualSellers.com and
a member of the audit committee but did not participate in management. Mr. Hand
did not own any shares of VirtualSellers.com and lost all incentive stock
options granted to him upon his resignation from the board of directors. The
shares of Healthtrac continue to trade on the OTC Bulletin Board. The closing
price of Healthtrac was $0.065 per share on August 20, 2002.
Mr. Hand has also managed his personal investment portfolio and business
interests from 1995 to present.
Mr. George Heard was appointed one of our directors on April 26, 2002. Mr.
Heard graduated from the School of Mines in Butte, Montana in 1975. Mr. Heard
obtained his Masters in Business Administration from the University of Hawaii in
1988. Mr. Heard is a registered professional engineer in the Province of
British Columbia, Canada. Mr. Heard was the mine manager for a start-up coal
mine in East Kalamantan, Indonesia which was developed as a joint ventures
between RTZ Corp. and British Petroleum at a cost of approximately $600,000,000.
Mr. Heard is the president and a director of Consolidated Global Minerals Ltd.,
a public company whose shares are traded on the TSX Venture Exchange. Mr. Heard
has been the president of Consolidated Global Minerals since January 1995.
Consolidated Global Minerals is engaged in the business of diamond and gold
exploration in the Northwest Territories of Canada, in the Canadian province of
Ontario and zinc exploration in Tunisia. Consolidated Global Minerals acquired
an option to acquired a property known as the Djebba property in
17
northwestern Tunisia in March 2000. In June 2000, Consolidated Global Minerals
entered into an option agreement to acquire a 100% interest in a property known
as the Fej Lahdoum project in northwestern Tunisia. Also in June 2000,
Consolidated Global Minerals entered into a joint venture with International
Bravo Resources Corporation (a publicly traded company listed on the TSX Venture
Exchange) for exploration work on the Djebba property. In November 2000,
Consolidation acquired options to purchase a 50% interest in a property known as
the Koudiat El Louatia mineral concession and a 100% interest in a property
known as the Ouled Moussa property, each of which properties is also located in
northwestern Tunisia. Consolidated Global Minerals has focused its efforts on
conducting geological exploration of its properties in Tunisia and continues to
undertake exploration work. None of the properties in Tunisia are in commercial
production. Mr. Heard is the owner of 377,185 common shares of Consolidated
Global Minerals, representing approximately 3.5% of the outstanding common
shares of Consolidated Global Minerals, and has options to purchase an
additional 525,000 common shares. The closing price of Consolidated Global
Minerals on the TSX Venture Exchange was $0.05 CDN per share (equal to
approximately $0.03 per share) on August 21, 2002.
Mr. Heard has been involved as a director and officer of the following public
companies in addition to Consolidated Global Minerals:
1. Mr. Heard was the president and a director of Golden Hemlock Exploration, a
public company whose shares were traded on the Vancouver Stock Exchange,
from October 1994 to June 1996. Golden Hemlock was engaged in the business
of mineral exploration for gold, silver and copper in the Province of
British Columbia, Canada and for gold in Mexico. During the time of Mr.
Heard's involvement with Golden Hemlock, the company completed a financing
in excess of $400,000 to conduct a geological exploration program on a
property known as the Tatsi property on which Golden Hemlock held an
option. Golden Hemlock completed an exploration program consisting of
surface sampling, trenching, geophysical surveys and drilling on the Tatsi
property. The results of the geological exploration program indicted that
there was no gold at depth. Based on these results, Golden Hemlock
determined that the results of the exploration did not warrant further
exploration. Mr. Heard also assisted Golden Hemlock with the negotiation of
an option on a prospective gold property in Mexico. Mr. Heard left Golden
Hemlock prior to the financing of the exploration program on this property.
Mr. Heard did not sell any shares of Golden Hemlock in connection with his
departure from Golden Hemlock. Mr. Heard did not at any time own more than
5% of the outstanding shares of Golden Hemlock. Mr. Heard is not aware of
any subsequent change of business of Golden Hemlock. There was no change of
control in connection with Mr. Heard's departure from Golden Hemlock.
Trading of Golden Hemlock has currently been halted by the TSX Venture
Exchange and Golden Hemlock is currently deemed inactive under the rules of
the TSX Venture Exchange.
2. Mr. Heard was a director of Wamco Resources, a public company whose shares
were traded on the Vancouver Venture Exchange, from February 1996 to
January 1998. Wamco Resources was engaged in the business of mineral
exploration for gold in Africa during the period of Mr. Heard's engagement
as a director of Wamco Resources. Wamco Resources held an option on a
prospective gold property in Ghana that had been granted by the Ghana
government prior to Mr. Heard's involvement with Wamco Resources. During
the time of Mr. Heard's involvement, Wamco Resources completed a financing
to carry out exploration of this property and carried out a drilling
program on the property using the funds raised. Reasonable results were
obtained on the property but the price of gold dropped during this period
with the result that Wamco Resources was not able to obtain additional
financing to carry out further exploration. Mr. Heard resigned when Wamco
Resources could not fund further geological exploration. Mr. Heard did not
sell any shares of Wamco Resources in connection with his departure and at
no time owned more than 5% of the outstanding shares of Wamco Resources.
There was no change of control in Wamco Resources in connection with Mr.
Heard's departure. Wamco Resources investigated non-mining deals subsequent
to Mr. Heard's departure. The shares of Wamco Resources continue to trade
on the TSX Venture Exchange under the name "Wamco Technology Group Ltd.".
The closing price of Wamco Resources was $0.07 CDN per share (equal to
approximately $0.04 per share) on July 25, 2002.
3. Mr. Heard was a director of Royal Victoria Minerals, a public company whose
shares were traded on the TSX Venture Exchange (formerly the Canadian
Venture Exchange and formerly the Vancouver
18
Stock Exchange), from June 1997 to April 2002. Royal Victoria Minerals was
engaged in the business of mineral exploration for gold in the Province of
Ontario, Canada. During the time of Mr. Heard's involvement, Royal Victoria
Minerals was in a transition and reorganization phase. Royal Victoria
Minerals sold prospective mineral properties that it had acquired in Mexico
and acquired options on prospective gold properties located in the Timmins
mining area of Ontario, Canada. The objective of Royal Victoria Minerals
was to enter into a joint venture with other property owners in the area
and to finance the exploration of the new properties. Mr. Heard left Royal
Victoria Minerals during the time that it was completing these option
acquisitions. Mr. Heard's departure was made at the request of new
investors who wanted their own representatives on the board of directors.
Mr. Heard did not sell any shares of Royal Victoria Minerals in connection
with his departure and at no time owned more than 5% of the outstanding
shares of Royal Victoria Minerals. There was no change of control in Royal
Victoria Minerals in connection with Mr. Heard's departure. To Mr. Heard's
knowledge, Royal Victoria Minerals is continuing to attempt to finance the
exploration of its newly acquired optioned properties. The shares of Royal
Victoria Minerals continue to be traded on the TSX Venture Exchange. The
closing price of Royal Victoria Minerals was $0.51 CDN per share (equal to
approximately $0.31 per share) on August 13, 2002.
4. Mr. Heard has been a director of Forum Development Corp., a public company
whose shares were traded on the TSX Venture Exchange, since November 8,
2001. Forum Development is engaged in the business of oil and gas
exploration, including the development of a coal and coal bed methane gas
project in the Merritt area of British Columbia, Canada. Mr. Heard is on
the board of directors of Forum Development to lend his mining expertise to
the company. Mr. Heard does not own any shares of Forum Development.
Trading of the shares of Forum Development on the TSX Venture Exchange has
been suspended pending the filing of financial statements.
SIGNIFICANT EMPLOYEES
We have no significant employees other than the officers and directors described
above.
TERMS OF OFFICE
Our Directors are appointed for a one-year term to hold office until the next
annual general meeting of our shareholders or until removed from office in
accordance with our bylaws. Our officers are appointed by our board of
directors and hold office until removed by the board.
COMPENSATION OF DIRECTORS
Our directors are reimbursed for reasonable out-of-pocket expenses in connection
with attendance at board of director and committee meetings, and may be granted
options to purchase shares of our common stock on a periodic basis at the
discretion of our board of directors or our stock option committee, when
constituted. We have not granted any stock options to our directors to date and
we do not have any arrangements or agreements with any of our directors for the
grant of stock options. Directors are not otherwise provided any remuneration
for their services as our directors.
19
Security Ownership Of Certain Beneficial Owners And Management
The following table sets forth certain information concerning the number of
shares of our common stock owned beneficially as of September 6, 2002 by: (i)
each person (including any group) known to us to own more than five percent (5%)
of any class of our voting securities, (ii) each of our directors (iii) each of
our named executive officers, and (iv) our executive officers and directors as a
group. Unless otherwise indicated, the shareholders listed possess sole voting
and investment power with respect to the shares shown.
- --------------------------------------------------------------------------------
Name and address Number of Shares Percentage of
Title of class of beneficial owner of Common Stock Common Stock (1)
- --------------------------------------------------------------------------------
Common Stock Grayson Hand 7,000,000 shares 60.7%
Director, President &
Chief Executive Officer
414, 1859 Spyglass Place
Vancouver, British Columbia
Common Stock George Heard NIL shares NIL%
Director
Suite 1280, 625 Howe St.
Vancouver, British Columbia
V6C 2T6
Common Stock All Officers and Directors 7,000,000 shares 60.7%
as a Group that consists
of two persons
- --------------------------------------------------------------------------------
(1) The percent of class is based on 11,532,000 shares of common stock
issued and outstanding as of September 6, 2002.
It is believed by us that all persons named have full voting and investment
power with respect to the shares indicated, unless otherwise noted in the table.
Under the rules of the Securities and Exchange Commission, a person (or group of
persons) is deemed to be a "beneficial owner" of a security if he or she,
directly or indirectly, has or shares the power to vote or to direct the voting
of such security, or the power to dispose of or to direct the disposition of
such security. Accordingly, more than one person may be deemed to be a
beneficial owner of the same security. A person is also deemed to be a
beneficial owner of any security, which that person has the right to acquire
within 60 days, such as options or warrants to purchase our common stock.
Description Of Securities
General
Our authorized capital stock consists of 100,000,000 shares of common stock,
with a par value of $0.001 per share, and 10,000,000 shares of preferred stock,
with a par value of $0.001 per share. As of September 6, 2002, there were
11,532,000 shares of our common stock issued and outstanding that were held by
approximately forty-three (43) stockholders of record. We have not issued any
shares of preferred stock.
Common Stock
Our common stock is entitled to one vote per share on all matters submitted to a
vote of the stockholders, including the election of directors. Except as
otherwise required by law or provided in any resolution adopted by our board of
directors with respect to any series of preferred stock, the holders of our
common stock will possess all voting power. Generally, all matters to be voted
on by stockholders must be approved by a majority (or, in the
20
case of election of directors, by a plurality) of the votes entitled to be cast
by all shares of our common stock that are present in person or represented by
proxy, subject to any voting rights granted to holders of any preferred stock.
Holders of our common stock representing one-percent (1%) of our capital stock
issued, outstanding and entitled to vote, represented in person or by proxy, are
necessary to constitute a quorum at any meeting of our stockholders. A vote by
the holders of a majority of our outstanding shares is required to effectuate
certain fundamental corporate changes such as liquidation, merger or an
amendment to our Articles of Incorporation. Our Articles of Incorporation do not
provide for cumulative voting in the election of directors.
Subject to any preferential rights of any outstanding series of preferred stock
created by our board of directors from time to time, the holders of shares of
our common stock will be entitled to such cash dividends as may be declared from
time to time by our board of directors from funds available therefor. See
"Dividend Policy."
Subject to any preferential rights of any outstanding series of preferred stock
created from time to time by our board of directors, upon liquidation,
dissolution or winding up of LaSalle, the holders of shares of our common stock
will be entitled to receive pro rata all assets of LaSalle available for
distribution to such holders.
In the event of any merger or consolidation of LaSalle with or into another
company in connection with which shares of our common stock are converted into
or exchangeable for shares of stock, other securities or property (including
cash), all holders of our common stock will be entitled to receive the same kind
and amount of shares of stock and other securities and property (including
cash).
Holders of our common stock have no pre-emptive rights, no conversion rights and
there are no redemption provisions applicable to our common stock.
Preferred Stock
Our board of directors is authorized by our articles of incorporation to divide
the authorized shares of our preferred stock into one or more series, each of
which shall be so designated as to distinguish the shares of each series of
preferred stock from the shares of all other series and classes. Our board of
directors is authorized, within any limitations prescribed by law and our
Articles of Incorporation, to fix and determine the designations, rights,
qualifications, preferences, limitations and terms of the shares of any series
of preferred stock including but not limited to the following:
(a) the rate of dividend, the time of payment of dividends, whether
dividends are cumulative, and the date from which any dividends shall
accrue;
(b) whether shares may be redeemed, and, if so, the redemption price and
the terms and conditions of redemption;
(c) the amount payable upon shares of preferred stock in the event of
voluntary or involuntary liquidation;
(d) sinking fund or other provisions, if any, for the redemption or
purchase of shares of preferred stock;
(e) the terms and conditions on which shares of preferred stock may be
converted, if the shares of any series are issued with the privilege
of conversion;
(f) voting powers, if any, provided that if any of the preferred stock or
series thereof shall have voting rights, such preferred stock or
series shall vote only on a share for share basis with our common
stock on any matter, including but not limited to the election of
directors, for which such preferred stock or series has such rights;
and
(g) subject to the above, such other terms, qualifications, privileges,
limitations, options, restrictions, and special or relative rights and
preferences, if any, of shares or such series as our board of
directors may, at the time so acting, lawfully fix and determine under
the laws of the State of Nevada.
21
Dividend Policy
We have never 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. As a result, we do not anticipate paying any cash dividends in the
foreseeable future.
Share Purchase Warrants
We have not issued and do not have outstanding any warrants to purchase shares
of our common stock.
Options
We have not issued and do not have outstanding any options to purchase shares of
our common stock.
Convertible Securities
We have not issued and do not have outstanding any securities convertible into
shares of our common stock or any rights convertible or exchangeable into shares
of our common stock.
Nevada Anti-Takeover laws
Nevada revised statutes sections 78.378 to 78.3793 provide state regulation over
the acquisition of a controlling interest in certain Nevada corporations unless
the articles of incorporation or bylaws of the corporation provide that the
provisions of these sections do not apply. Our articles of incorporation and
bylaws do not state that these provisions do not apply. The statute creates a
number of restrictions on the ability of a person or entity to acquire control
of a Nevada company by setting down certain rules of conduct and voting
restrictions in any acquisition attempt, among other things. The statute is
limited to corporations that are organized in the state of Nevada and that have
200 or more stockholders, at least 100 of whom are stockholders of record and
residents of the State of Nevada; and does business in the State of Nevada
directly or through an affiliated corporation.
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. An interest will be deemed a substantial interest if the value of
the interest, including the fair market value of all securities of the issuer
received or to be received, or subject to options, warrants or rights received
or to be received, exceeds $50,000.
No expert or counsel named in this prospectus is connected with the registrant
or any of its parents or subsidiaries as a promoter, managing or principal
underwriter, voting trustee, director, officer, or employee.
Cane & Company, LLC, our independent legal counsel, has provided an opinion on
the validity of our common stock.
Morgan & Company, independent chartered accountants, has audited our financial
statements included in this prospectus and registration statement to the extent
and for the periods set forth in their audit report. Morgan & Company has
presented their report with respect to our audited financial statements. The
report of Morgan & Company is included in reliance upon their authority as
experts in accounting and auditing.
22
Disclosure Of Commission Position Of Indemnification For Securities Act
Liabilities
Our directors and officers are indemnified as provided by the Nevada Revised
Statutes 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 of 1933 is against public policy as expressed in the
Securities Act of 1933, 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.
Organization Within Last Five Years
We were incorporated on December 3, 2001 under the laws of the state of Nevada.
We purchased an option to acquire a 70% interest in three mineral claims located
in the Prelude Lake area of the Northwest Territories, Canada from Consolidated
Global Minerals Ltd. in January 2002.
Mr. Hand, our sole executive officer and one of our directors, has been our sole
promoter since our inception.
Mr. Hand acquired 7,000,000 shares of our common stock at a price of $0.001 US
per share on January 15, 2002. Mr. Hand paid a total purchase price of $7,000
for these shares.
Other than the purchase of his stock and a management agreement, Mr. Hand has
not entered into any agreement with us in which he is to receive or provide to
us any thing of value.
Description Of Business
In General
We are an exploration stage company engaged in the acquisition and exploration
of mineral properties. We acquired an option to own a 70% interest in three
mineral claims in the Northwest Territories, Canada in January 2002. We refer
to these mineral claims as the Prelude Lake mineral claims. Further exploration
of these mineral claims is required before a final determination as to their
commercial viability can be made. There is no assurance that a commercially
viable mineral deposit exists on our mineral claims. Our plan of operations is
to carry out exploration work on these claims in order to ascertain whether they
possess commercially exploitable quantities of diamonds and gold. We can
provide no assurance to investors that our mineral claims contain a commercially
exploitable mineral deposit, or reserve, until appropriate exploratory work is
done and an economic evaluation based on that work concludes economic
feasibility.
Option Agreement for the Prelude Lake Mineral Claims
We have purchased an option to acquire a 70% interest in the Prelude Lake
mineral claims pursuant to an option agreement dated January 17, 2002 between us
and Consolidated Global Minerals Ltd. ("Consolidated Global Minerals"). The
consideration paid by us to Consolidated Global Minerals for the grant of the
option was $1,000.
We are entitled to exercise the option by completing the following required
exploration expenditures on the Prelude Lake mineral claims in accordance with
the option agreement:
(A) $24,000 on or before November 30, 2002;
(B) further $20,000 on or before November 30, 2003; and
(C) a final $31,250 on or before November 30, 2004.
In the event that we spend, in any of the above periods, less than the required
sum, we may, at our option, pay to Consolidated Global Minerals the difference
between the amount actually spent and the required exploration
23
expenditure in full satisfaction of the exploration expenditures to be incurred.
In the event that we spend, in any period, more than the required sum, then the
excess will be carried forward and applied to the required exploration
expenditures to be incurred in subsequent periods. If we fail to make any
required payment or incur any required exploration expenditure within the time
required by the option agreement, then our option will terminate. If we default
on any of our obligations to Consolidated Global Minerals other our obligations
to make any payment or incur any exploration expenditure provided by the option
agreement, then will have 30 days to cure the default upon receipt of written
notice of default from Consolidated Global Minerals and the option will
terminate if we have not cured the default within that time, or started to cure
and are pursuing the cure until completion. We have the right to terminate the
option at our election upon 30 days written notice to Consolidated Global
Minerals regardless of default. Our option will terminate in any event on
November 30, 2004 in the event that we have not incurred the exploration
expenditures necessary to exercise our option. If we do incur the exploration
expenditures required under the option agreement, then we our option will vest
and we will acquire a 70% interest in the Prelude Lake minerals claims. We will
have no further rights to the Prelude Lake mineral claims upon termination of
the option for any reason.
Upon exercise of the option in accordance with the option agreement, we have
agreed with Consolidated Global Minerals to join and participate in a single
purpose joint venture for the purpose of further exploring and developing and,
if economically and politically feasible, constructing and operating a mine on
the property. The joint venture will be governed by a joint agreement to be
negotiated and executed by us and Consolidated Global Minerals upon exercise of
the option. Our agreement with Consolidated Global Minerals states that the
joint venture agreement is to incorporate commercially reasonable and acceptable
terms and conditions according to industry standards for mining projects of the
nature and in the location of the mining project planned for the mineral claims.
Ownership of the Prelude Lake Mineral Claims
The Prelude Lake minerals claims are currently owned by Consolidated Global
Minerals subject to the agreement of Consolidated Global Minerals to make the
following payments to R.T. Heard & Associates:
1. an annual royalty in the amount of $50,000 CDN (approximately $31,900 US as
of September 6, 2002), payable in two equal installments on May 27 and
November 27 of each year;
2. payment of a 4% gross overriding royalty. The gross overriding royalty is
defined as 4% of the average appraised value of all gem and industrial
diamonds recovered, sorted and graded from the property, free and clear of
all costs of development and operations.
3. payment of a 2% net smelter royalty. The net smelter royalty will equal 2%
of all amounts received from any product mined from the property, other
than diamonds, subject to the deduction of smelter, minting or refining
costs.
In the event that Consolidated Global Minerals defaults on its obligations to
R.T. Heard & Associates, then R.T. Heard & Associates will have the right to
demand return of the property from Consolidated Global Minerals.
R.T. Heard & Associates agreed upon execution of our agreement with Consolidated
Global Minerals to waive the payment of the annual royalty until December 31,
2003.
In the event that we exercise our option, we will acquire a 70% undivided right,
title and interest in and to the Prelude Lake mineral claims free and clear of
all charges, encumbrances and claims, subject to the obligation to pay to R.T.
Heard & Associates an amount equal to 70% of the annual royalty, gross
overriding royalty and net smelter royalty payable under the agreement between
Consolidated Global Minerals and R.T. Heard & Associates. We will not be
responsible for payment of any amount on account of the annual royalty, gross
overriding royalty and net smelter royalty payable under the agreement between
Consolidated Global Minerals and R.T. Heard & Associates until such time as we
have exercised our option and acquired a 70% interest in the property. Any
amounts payable to R.T. Heard & Associates will only accrue from the date of
exercise of our option and acquisition of a 70% interest in the property. In
the event that either we or Consolidated Global Minerals fails to make any
payment to R.T. Heard & Associates on account of the annual royalty, gross
overriding royalty or net smelter royalty after the exercise of our option, then
R.T. Heard & Associates will have
24
the right to demand return of the property and we would lose all of our interest
in the Prelude Lake mineral claims.
In the event that we are successful in acquiring a 70% interest in the Prelude
Lake mineral claims by exercise of our option, we and Consolidated Global have
agreed under our option agreement to enter into a joint venture for the purpose
of further exploring and developing and, if economically and politically
feasible, constructing and operating a mine on the Prelude Lake mineral claims.
Recording of the Prelude Lake Mineral Claims
The Prelude Lake mineral claims consist of three contiguous mineral claims
situated 45 kilometers northeast of Yellowknife in south-central Northwest
Territories. The mineral claims cover an area of 465 acres on the southeast
shore of Prelude Lake and are recorded as follows:
Claim Name Record No. Area(acres) Expiry Date
----------- ---------- ----------- ------------
JEN 1 F24066 206.60 January 14, 2006
JEN 2 F37232 103.30 June 21, 2005
JEN 3 F37233 154.95 June 21, 2005
The three Prelude Lake mineral claims were staked in 1994 and are in good
standing until June 21, 2005 (Jen 2 and 3) and January 14, 2006 (Jen 1) based on
prior exploration work completed on the properties by previous owners. Staking
is the physical act of locating the boundaries of a mining claim. The mineral
claims have not been surveyed.
Mineral claims in the Northwest Territories may be kept in good standing by
conducting representation work valued at $4.00 CDN per acre (approximately $2.50
US per acre as of September 6, 2002) during the first two years of tenure and
$2.00 CDN per acre (approximately $1.25 US per acre as of September 6, 2002) per
year thereafter for a period of up to ten years. Representation work consists of
eligible geological exploration work conducted on the property. Representation
work can include surface exploration activities, diamond drilling, underground
development, geological surveys, legal surveys and improvements to access,
including road building and construction. A statement of work, supported by a
technical report is required to substantiate representation work, must be filed
under the Canada Mining Regulations to maintain the claims in good standing.
Where the claims have been kept in good standing for ten years, then the holder
must either apply to take the claim to a mining lease or allow the claim to
lapse. The current expiry dates for the Prelude Lake mineral claims represent
the maximum periods that these claims may be extended based on prior
representation work completed on the mineral claims. The prior representation
work included sampling and analysis of samples collected from the Prelude Lake
mineral claims in mid-1994 and further geological surveys completed in May 1996.
Accordingly, these claims must be converted to mining leases prior to June 21,
2005 for the Jen 2 and 3 claims and January 14, 2006 for the Jen 1 claim. An
application for a mining lease would involve a legal survey of the mineral
claims and if granted would be issued for a period of twenty-one years.
Location of the Prelude Lake Mineral Claims
The Prelude Lake mineral claims are situated approximately 35 kilometers
northeast of Yellowknife in south-central Northwest Territories, Canada.
Conventional access to the mineral claims is via highway 4 (Ingraham Trail) from
Yellowknife to the east end of Prelude Lake, a distance of 45 km. Equipment and
supplies can be transported to this point which is 3.5 km southeast of the
mineral claims. Prelude Lake can be used for boat access during the summer
months and for snow machines in winter.
The city of Yellowknife, with a permanent population of 18,000, is the capital
of the Northwest Territories and is a major supply and services centre. The city
is connected by highway with Alberta to the south and has daily scheduled air
services.
The climate of the Yellowknife area is typical of Canada's northern regions.
Winter conditions persist from late October through April with mean daily
temperatures ranging from minus 7 degrees Celsius to minus 28 degrees. Average
temperatures in July and August range from 12 to 28 degrees Celsius. Average
annual precipitation includes 15 cm of rain and 135 cm of snow. Mineral
exploration work is feasible throughout the year with the
25
exception of the ice-breakup period in the spring and the freeze-up period in
the fall. Ice remains on most lakes through the end of May.
The terrain in the area of the Prelude Lake mineral claims is typical of the
northern Canadian Shield. Locally extensive forest cover is broken by numerous
lakes and open, swampy areas. Topography is subdued with elevations in the
claims area ranging from 167 metres above sea level on the surface of Prelude
Lake to more than 220 metres immediately west of the small, 250 metres diameter
circular lake on the JEN 1 claim. Locally steep topography surrounds the western
and northern limits of this lake.
Geological Report
We engaged Mr. Nick Carter, Ph.D., P.Eng. to prepare an initial geological
evaluation report on the Prelude Lake mineral claims. Mr. Carter is a graduate
of the University of New Brunswick with B.Sc.(1960), Michigan Technological
University with M.S.(1962) and the University of British Columbia with
Ph.D.(1974).
We received Mr. Carter's report on February 25, 2002. Mr. Carter's report is
based in part on a previous report on the Prelude Lake mineral claims prepared
Mr. Carter and dated March 25, 1997, and on records of previous exploratory work
completed between 1973 and 1998.
The purpose of our obtaining the geological report was to assist us with a
determination as to whether we should proceed with further exploration
procedures to evaluate the feasibility of a mining project on the optioned
mineral claims. The geological report summarizes the results of the history of
the exploration of the mineral claims, the regional and local geology of the
mineral claims and the mineralization and the geological formations. The
geological report also gives conclusions regarding potential mineralization of
the mineral claims and recommends a further geological exploration program.
Exploration History of the Mineral Claims
The history of the exploration of the mineral claims is summarized in the
geological report that we obtained from Mr. Carter.
Gold mineralization within the boundaries of the present Prelude Lake mineral
claims was discovered in the 1940's and limited exploration work was conducted
through 1973. While some locally good grades of gold mineralization were
obtained from this work, the principal focus of more recent investigations has
been directed to the search for diamond-bearing kimberlite pipes.
The present claims were staked in early 1994 to cover both a known gold showing
and a nearby 250 metres diameter circular lake which was thought to be
reflecting the presence of a possible kimberlite pipe. Prospecting and the
collection of samples for mineral analyses were undertaken in mid-1994 and
geological surveys were completed over and adjacent to the circular lake in May
of 1996. The 1994 and 1996 work provided sufficient representation work to
maintain the three Prelude Lake mineral claims in good standing until 2005 and
2006.
Geology and Mineralization of the Mineral Claims
The results of the geological report prepared by Mr. Carter indicate that the
Prelude Lake mineral claims include a reasonably well documented zone of gold
mineralization plus indications of a possible kimberlite pipe. Kimberlite pipes
are volcanic intrusions that originated from great depths (+150 km) within the
earth's crust and include angular fragments of older, crustal rock which are
incorporated by the parent magma during its rapid ascent to the earth's surface.
Some of these fragments, from deeper parts of the crust, may contain diamonds.
Kimberlite pipes are circular in plan and carrot-shaped in section and may
extend to depths of between 500 and 1000 metres below present day surface.
In his geological report, Mr. Carter stated that numerous kimberlite pipes are
known throughout the south-central Northwest Territories including one pipe
south of Yellowknife. Kimberlites erode much more readily than the more
resistant rocks they intrude and the recessive areas above these pipes are
commonly occupied by lakes.
26
In his geological report, Mr. Carter concluded that Limited work to date on the
Prelude Lake mineral claims has identified minerals which may be indicative of a
kimberlite possibly centered on the small circular lake in the northeastern part
of the Prelude Lake mineral claims.
Recommendations of Geological Report
The geological report concluded that the Prelude Lake mineral claims are of
sufficient merit to warrant further exploratory work. While the principal focus
of this work should be directed to further investigation of the potential for a
diamond-bearing kimberlite; the known gold-bearing zone on the Prelude Lake
mineral claims warrants further prospecting in an attempt to identify similar,
parallel structures.
A first phase exploratory program is recommended by the geological report that
is to consist of the drilling of eight vertical holes of 20 meters each. The
purpose of this exploratory drill program is to test the bedrock beneath the
small circular lake in the central property area for the presence of kimberlite.
The proposed program, which is estimated to take 15 to 20 days to complete, is
recommended to be undertaken during the winter months on the frozen lake
surface. The geological report recommended that two east-west fences of four
holes each be drilled at 50 meters centers to adequately investigate the nature
of the bedrock beneath the lake. Water depths are estimated to be between 6 and
8 meters and it should be possible to recover between 12 and 14 meters of core
from each hole.
The estimated cost of the recommended geological program is $25,500.
Accordingly, the completion of this initial phase of exploration will satisfy
the exploration expenditure requirement of $24,000 required prior to November
30, 2002 pursuant to our option agreement with Consolidated Global Minerals Ltd.
The geological report concluded that further exploratory work on the Prelude
Lake mineral claims would be dependent on the results obtained from the initial
phase of exploration work.
Current State of Exploration
We have accepted the recommendations of the geological report and have decided
to proceed to complete the initial phase geological exploration recommended by
the geological report.
We retained Mr. Terry Heard of R.T. Heard & Associates to undertake a visit to
the Prelude Lake mineral claims to identify the drill targets for the
recommended exploration program. Mr. Heard completed the visit to the site of
the claims in early April 2002 and has identified the drilling targets. A
decision has been made to drill from the edge of the Prelude Lake at an angle in
order to obtain drilling core samples from rock beneath the lake. The
geological report recommended drilling through ice on the lake in winter but
this would not be possible to undertake until next winter due to weather
conditions.
We have entered into a contract with V. Emery Drilling & Exploration Ltd. to
complete the drilling program recommended by the geological report at a cost of
$25,500. This drilling contract was arranged with the assistance of Consolidated
Global Minerals. The drilling program is required under the contract to be
completed by October 31, 2002. The timing of the drilling will depend on the
availability of drilling equipment and work crews in the vicinity of the Prelude
Lake mineral claims. Core samples will be obtained from the drilling program
and will be sent to a qualified laboratory for analysis. The results of the
geological program will be forwarded to Mr. Carter, our geological consultant,
for his interpretation and analysis. Mr. Carter will provide us with his
conclusions and recommendations in the form of a further geological report. We
anticipate that we would receive this geological report in the fall of 2002.
We will make a determination whether to proceed with additional exploration
based on our review of the results of this initial phase of exploration. In
making our determination, we will assess whether the results of the exploration
program are sufficiently positive to enable us to achieve additional financing
that will enable us to pay for additional exploration.
Our planned exploration program is exploratory in nature and there is no
assurance that mineral reserves will be found.
27
The Prelude Lake mineral claims presently do not have any mineral reserves. The
property that is the subject to the mineral claim is undeveloped and does not
contain any open-pit or underground mines. There is no mining plant or
equipment located on the property that is the subject of the mineral claim.
Currently, there is no power supply to the mineral claim.
Competitive Conditions
We are a junior mineral resource exploration company. We compete with other
junior mineral resource exploration companies for financing from a limited
number of investors that are prepared to make investments in junior mineral
resource exploration companies. The presence of competing junior mineral
resource exploration companies may impact on our ability to raise additional
capital in order to fund our exploration programs if investors are of the view
that investments in competitors are more attractive based on the merit of the
mineral properties under investigation and the price of the investment offered
to investors.
If the results of our mineral exploration program are successful, we may try to
sell our mineral claims to a senior exploration company or to enter into a joint
venture agreement with a senior exploration company for the further exploration
and possible production of our mineral claims. We would face competition from
other junior mineral resource exploration companies if we attempt to enter into
a sale or a joint venture agreement with a senior exploration company. Senior
exploration companies have limited ability to purchase properties from junior
exploration properties or to enter into joint venture agreements with junior
exploration programs and will seek the junior exploration companies who have the
properties that they deem to be the most attractive in terms of potential return
and investment cost.
Compliance with Government Regulation
All mineral exploration activities undertaken on the Prelude Lake mineral claims
must be completed in accordance with the Territorial Land Use Regulations of the
Department of Indian and Northern Affairs. The Territorial Land Use Regulations
do not impose any permitting requirements for the initial stages of exploration
work involving prospecting, staking or locating a mineral claim unless the
exploration requires the use of equipment or material that normally requires a
permit. The regulations prescribe thresholds that will require either a Class B
land use permit or a Class A land use permit depending on the amount of physical
disturbance to the land. The exploration work to be completed on the Prelude
Lake mineral claims will not meet the threshold requirements that would require
a land use permit due to the fact that the drilling equipment to be used does
not trigger the permit requirements. The drilling equipment to be used in this
initial phase is lightweight and compact but is limited in application to
drilling holes of a shallow depth. Accordingly, we may proceed with this
initial phase of exploration without any land use permit. We anticipate that
any subsequent stages of exploration that require drilling using heavier and
larger drilling equipment would require either a Class B land use permit or a
Class A land use permit due to the fact that any further exploration program
would most likely involve drilling with heavier equipment that is required to
drill deeper holes. If the further exploration program requires the continued
drilling of shallow holes that can be achieved with the current compact drilling
equipment, then it is possible that no Class B land use permit or a Class A land
use permit would be required. If we determine to proceed with additional
exploration during the next twelve months and are able to achieve the required
financing, we will require a Class B land use permit or a Class A land use
permit if the drilling program or other exploration activity requires such
permit. It will not be possible to determine which class of land use permit
would be required at this stage until the nature of the exploration program and
the nature of the drilling activity is determined. Applications may be made
through the Mackenzie Land and Valley Water Board in the Northwest Territories.
Application fees are in the order of $150 for a Class B land use permit.
Mineral exploration activities may only be undertaken in the Northwest
Territories by persons who hold prospecting licenses issued under the Canada
Mining Regulations. We will not be required to obtain a prospecting license in
order to proceed with the initial phase of our exploration as we have contracted
with persons who hold the required prospecting licenses to complete this work.
We will be required to obtain a prospecting license if we exercise our option
and become the 70% owner of the Prelude Lake mineral claims. We would be
required to register under the Business Corporations Act in the Northwest
Territories prior to obtaining a prospecting license. The cost of completing
this registration and obtaining a prospecting license is estimated at being in
the order of $1500.
28
Native Land Claims
The region of the Northwest Territories in which the mineral claims are located
are subject to land claims of the North Slave native peoples. No settlement
has been reached between the Canadian federal government, which administers the
Northwest Territories, and the North Slave native peoples. Accordingly, it is
not possible to state what will be the impact of native land claims on ownership
of the Prelude Lake mineral claims. However, it has been the practice of the
Canadian government in negotiating with native peoples to preserve private
interests in land that have been established prior to any negotiated settlement.
Employees
We have no employees as of the date of this prospectus other than our Mr.
Grayson Hand, our sole executive officer and one of our directors.
We conduct our business largely through agreements with consultants and
arms-length third parties.
Research and Development Expenditures
We did incur any research or development expenditures from December 3, 2001, the
date of our incorporation, through to February 28, 2002, the date of our audited
financial statements included with this prospectus.
Subsidiaries
We do not have any subsidiaries.
Patents and Trademarks
We do not own, either legally or beneficially, any patent or trademark.
29
Plan Of Operations
Our business plan is to proceed with the exploration of the Prelude Lake mineral
claims to determine whether they possess commercially exploitable reserves of
diamonds and gold. We are currently undertaking the initial phase of the
exploration program recommended by the geological report we obtained on our
optioned mineral property. We anticipate that this phase of the recommended
geological exploration program will cost approximately $25,500. We had $70,416
in cash as of May 31, 2002. Accordingly, we are able to proceed with this
initial phase of exploration without additional financing.
We anticipate that this first phase will be complete by the fall of 2002. Upon
completion of this first phase of exploration, we will obtain a geological
report that will summarize the results of this exploration program and will make
recommendations as to the conduct of further exploration on the Prelude Lake
mineral claims. We will make a determination as to whether to proceed with
further exploration based on the recommendations of this geological report. If
a recommendation is made in favor of further exploration, we will assess whether
to proceed with additional exploration based on the cost of the recommended
exploration program, our cash resources at the time and our ability to raise any
additional financing that will be required to proceed with this further
exploration.
We will be required to complete further exploration prior to substantiating
whether or not the Prelude Lake mineral claims host commercially exploitable
reserves of diamonds or gold. The costs of proceeding with an additional
exploration program are not known to us at this time and will not be known until
the completion of preliminary exploration.
We anticipate that we will incur the following expenses over the next twelve
months:
1. $25,500 in connection with the completion of the first phase of the
recommended geological exploration program on our Prelude Lake mineral
claims;
2. $9,000 in respect of our management agreement with WFC Management
Corporation for the services of Mr. Grayson Hand, our sole executive
officer and one of our directors; and
3. $20,000 for operating expenses, including an estimated amount of $15,023
for professional legal and accounting expenses associated with our filing
the registration statement of which this prospectus forms a part with the
Securities and Exchange Commission and becoming a reporting issuer under
the Securities Exchange Act of 1934;
We had cash in the amount of $70,416 as of May 31, 2002. Our total expenditures
over the next twelve months are anticipated to be $54,500. Based on our working
capital position of $47,856 at May 31, 2002, we believe we have sufficient cash
resources to pay for our operating expenses over the next six months, but we
will require additional financing in the approximate amount of $7,000 to fund
our total anticipated operating expenses over the next twelve months.
Results Of Operations For Period Ending February 28, 2002 and the Three Months
Ended May 31, 2002
We did not earn any revenues during the period ending February 28, 2002 or the
three months ended May 31, 2002. We do not anticipate earning revenues until
such time as we have entered into commercial production of our mineral
properties. We are presently in the exploration stage of our business and we
can provide no assurance that we will discover commercially exploitable levels
of mineral resources on our properties, or if such resources are discovered,
that we will enter into commercial production of our mineral properties.
We incurred operating expenses in the amount of $8,612 for the period from
inception on December 3, 2001 to February 28, 2002. These operating expenses
included: (a) payment of $1,000 in connection with our option payment
obligations, (b) payments of $999 for exploration costs in connection of the
Prelude Lake mineral claim; (c) professional fees in the amount of $5,762 in
connection with our corporate organization; and (d) management fees in the
amount of $750 paid to W.F.C. Management, a private company controlled by Mr.
Grayson Hand, our sole executive officer and one of our directors.
30
We incurred operating expenses in the amount of $18,512 for the three month
period ended May 31, 2002. These operating expenses included: (a) $1,029 for
exploration costs in connection of the Prelude Lake mineral claim; (b)
professional fees in the amount of $13,735 in connection with our corporate
organization and the filing of a registration statement with the Securities and
Exchange Commission; and (c) management fees in the amount of $2,250 paid to
W.F.C. Management, a private company controlled by Mr. Grayson Hand, our sole
executive officer and one of our directors.
We anticipate our operating expenses will increase as we undertake our plan of
operations. The increase will be attributable to our completion additional
geological exploration of the Prelude Lake mineral claims and the professional
fees to be incurred in connection with the filing of a registration statement
with the Securities Exchange Commission under the Securities Act of 1933. We
anticipate our ongoing operating expenses will also increase once we become a
reporting company under the Securities Exchange Act of 1934.
We incurred a loss in the amount of $8,612 for the period from inception to
February 28, 2002. We incurred a loss in the amount of $18,512 for three month
period ended May 31, 2002. Our losses were attributable entirely to operating
expenses.
Liquidity and Capital Resources
We had cash of $70,416 as of May 31, 2002, compared to cash of $73,942 as of
February 28, 2002. We had working capital of $47,856 as of May 31, 2002,
compared to working capital of $66,368 as of February 28, 2002.
Our total expenditures over the next twelve months are anticipated to be $54,500
based on our stated plan of operations, as outlined above. Based on our working
capital position of $47,856 at May 31,, 2002, we believe we have sufficient cash
resources to pay for our operating expenses over the next six months, but we
will require additional financing in the approximate amount of $7,000 to fund
our total anticipated operating expenses over the next twelve months.
We anticipate that we will require additional financing to proceed with
exploration of the Prelude Lake mineral claims beyond the initial phase of
exploration. We have no arrangements for any additional financing and there is
no assurance that we will be able to achieve this additional financing. We
anticipate that any additional financing would be through sales of our common
stock. Additional sales of our common stock would result in dilution to our
current shareholders.
If we do not complete the exploration expenditures required under the option
agreement for the Prelude Lake mineral property, then our option will terminate
and we will lose all our rights and interest in the Prelude Lake mineral
property. If we do not secure additional financing to incur the required
exploration expenditures, we may consider bringing in a joint venture partner to
provide the required funding. We have not undertaken any efforts to locate a
joint venture partner. In addition, we cannot provide investors with any
assurance that we will be able to locate a joint venture partner who will assist
us in funding the exploration of the Prelude Lake mineral property. We may also
pursue acquiring interests in alternate mineral properties in the future.
We have not attained profitable operations and are dependent upon obtaining
financing to pursue exploration activities. For these reasons our auditors
stated in their report that they have substantial doubt we will be able to
continue as a going concern.
Description Of Property
We acquired an option to own a 70% interest in the Prelude Lake mineral claims.
We do not own or lease any property other than our option to acquire a 70%
interest in the Prelude Lake mineral claims.
Our head office is located in the business premises of Mr. Grayson Hand, our
sole executive officer and one of our directors. The use of these premises is
included in the administrative services provided by WFC Management Corporation
pursuant to our management agreement. Accordingly, we do not pay any extra
amount under our management agreement for use of these premises. This
management agreement has a term of twelve months expiring January 31, 2003.
31
Certain Relationships And Related Transactions
We issued 7,000,000 shares of common stock on January 15, 2002 to Mr. Grayson
Hand at a price of $0.001 per share for total proceeds of $7,000. Mr. Hand is
our sole executive officer and one of our directors.
We entered into our option agreement with Consolidated Global Minerals on
January 17, 2002 whereby we purchased our option to acquire a 70% interest in
the Prelude Lake mineral claims. See Description of Business - Option Agreement
for the Prelude Lake Mineral Claims for a detailed discussion of this option
agreement. Mr. George Heard, one of directors, is the president and a director
of Consolidated Global Minerals.
The Prelude Lake minerals claims are currently owned by Consolidated Global
Minerals subject to the agreement of Consolidated Global Minerals to make the
following payments to R.T. Heard & Associates:
1. an annual royalty in the amount of $50,000 CDN (approximately $31,900 US as
of September 6, 2002), payable in two equal installments on May 27 and
November 27 of each year;
2. payment of a 4% gross overriding royalty; and
3. payment of a 2% net smelter royalty.
In the event that Consolidated Global Minerals defaults on its obligations to
R.T. Heard & Associates, then R.T. Heard & Associates will have the right to
demand return of the property from Consolidated Global Minerals. R.T. Heard &
Associates has agreed with us and Consolidated Global Minerals to defer the
payment of all royalty amounts payable to R.T. Heard & Associates with respect
to the Prelude Lake mineral claims until December 31, 2003. See Description of
Business - Ownership of the Prelude Lake Mineral Claims for a detailed
discussion of these agreements. R.T. Heard & Associates is controlled by Mr.
Terry Heard, the brother of Mr. George Heard, one of our directors.
We have entered into a management agreement effective February 1, 2002 with WFC
Management Corporation, a company controlled by Mr. Grayson Hand, our President
and a director. We pay WFC Management Corporation a management fee of $750 per
month for a one year term expiring January 31, 2003 in consideration for WFC
Management Corporation providing management and administration services to us.
These services include the services of Mr. Hand.
We have engaged Consolidated Global Minerals to undertake the geological work
program recommended by our geological report on the Prelude Lake mineral claims.
See Description of Business - Current State of Exploration for a detailed
discussion of this work program. The estimated cost of this work program is
$25,500. We will reimburse Consolidated Global Minerals for its expenses
incurred in completing this work on our behalf. Mr. George Heard, one of our
directors, is the president and a director of Consolidated Global Minerals.
Market For Common Equity And Related Stockholder Matters
No Public Market for Common Stock
There is presently no public market for our common stock. We anticipate making
an application for trading of our common stock on the Over-the-Counter Bulletin
Board upon the effectiveness of the registration statement of which this
prospectus forms a part. However, we can provide no assurance that our shares
will be traded on the bulletin board or, if traded, that a public market will
materialize.
The Securities Exchange Commission has adopted rules that regulate broker-dealer
practices in connection with transactions in penny stocks. Penny stocks are
generally equity securities with a price of less than $5.00, other than
securities registered on certain national securities exchanges or quoted on the
Nasdaq system, provided that current price and volume information with respect
to transactions in such securities is provided by the exchange or system. The
penny stock rules require a broker-dealer, prior to a transaction in a penny
stock, to deliver a standardized risk disclosure document prepared by the
Commission, that: (a) contains a description of the nature and level of risk in
the market for penny stocks in both public offerings and secondary trading; (b)
contains a description of the broker's or dealer's duties to the customer and of
the rights and remedies available
32
to the customer with respect to a violation to such duties or other requirements
of Securities' laws; (c) contains a brief, clear, narrative description of a
dealer market, including bid and ask prices for penny stocks and the
significance of the spread between the bid and ask price; (d) contains a
toll-free telephone number for inquiries on disciplinary actions; (e) defines
significant terms in the disclosure document or in the conduct of trading in
penny stocks; and (f) contains such other information and is in such form,
including language, type, size and format, as the Commission shall require by
rule or regulation. The broker-dealer also must provide, prior to effecting any
transaction in a penny stock, the customer with: (a) bid and offer quotations
for the penny stock; (b) the compensation of the broker-dealer and its
salesperson in the transaction; (c) the number of shares to which such bid and
ask prices apply, or other comparable information relating to the depth and
liquidity of the market for such stock; and (d) a monthly account statements
showing the market value of each penny stock held in the customer's account. In
addition, the penny stock rules require that prior to a transaction in a penny
stock not otherwise exempt from those rules; the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitably statement.
These disclosure requirements may have the effect of reducing the trading
activity in the secondary market for our stock if it becomes subject to these
penny stock rules. Therefore, if our common stock becomes subject to the penny
stock rules, stockholders may have difficulty selling those securities.
Holders of Our Common Stock
As of the date of this registration statement, we had forty-three (43)
registered shareholders.
Rule 144 Shares
A total of 7,000,000 shares of our common stock will be available for resale to
the public after January 15, 2003 in accordance with the volume and trading
limitations of Rule 144 of the Securities Act of 1933.
In addition, 4,532,000 shares of our common stock owned in aggregate by
forty-two non-affiliate shareholders will be available for resale to the public
after February 28, 2003 in accordance with the volume and trading limitations of
Rule 144 of the Securities Act of 1933. These shares comprise all of the shares
that are registered by this prospectus.
In general, under Rule 144 as currently in effect, a person who has beneficially
owned shares of a company's common stock for at least one year is entitled to
sell within any three month period a number of shares that does not exceed the
greater of:
1. One percent of the number of shares of the company's common stock then
outstanding, which, in our case, will equal approximately 115,320 shares as
of the date of this prospectus; or
2. The average weekly trading volume of the company's common stock during the
four calendar weeks preceding the filing of a notice on Form 144 with
respect to the sale.
Sales under Rule 144 are also subject to manner of sale provisions and notice
requirements and to the availability of current public information about the
company.
Under Rule 144(k), a person who is not one of the company's affiliates at any
time during the three months preceding a sale, and who has beneficially owned
the shares proposed to be sold for at least two years, is entitled to sell
shares without complying with the manner of sale, public information, volume
limitation or notice provisions of Rule 144.
As of the date of this prospectus, persons who are our affiliates hold 7,000,000
shares of our stock that may be sold pursuant to Rule 144 after January 15,
2003.
Stock Option Grants
To date, we have not granted any stock options.
33
Registration Rights
We have not granted registration rights to the selling shareholders or to any
other persons.
We are paying the expenses of the offering because we seek to: (i) become a
reporting company with the Commission under the Securities Exchange Act of 1934;
and (ii) enable our common stock to be traded on the Over-The-Counter Bulletin
Board. We plan to file a Form 8-A registration statement with the Commission
prior to the effectiveness of the Form SB-2 registration statement. The filing
of the Form 8-A registration statement will cause us to become a reporting
company with the Commission under the 1934 Act concurrently with the
effectiveness of the Form SB-2 registration statement. We must be a reporting
company under the 1934 Act in order that our common stock is eligible for
trading on the Over-The-Counter bulletin board. We believe that the
registration of the resale of shares on behalf of existing shareholders may
facilitate the development of a public market in our common stock if our common
stock is approved for trading on the Over-The-Counter Bulletin Board.
We consider that the development of a public market for our common stock will
make an investment in our common stock more attractive to future investors. In
the near future, in order for us to continue with our mineral exploration
program, we will need to raise additional capital. We believe that obtaining
reporting company status under the 1934 Act and trading on the OTCBB should
increase our ability to raise these additional funds from investors.
Dividends
There are no restrictions in our articles of incorporation or bylaws that
prevent 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 and we do not plan to declare any dividends
in the foreseeable future.
34
Executive Compensation
Summary Compensation Table
The table below summarizes all compensation awarded to, earned by, or paid to
Mr. Grayson Hand, our sole executive officer, for all services rendered in all
capacities to us for the fiscal period ended February 28, 2002.
- --------------------------------------------------------------------------------
Annual Compensation Long Term Compensation
------------------- -----------------------
Other LTIP All
Annual Restricted pay- Other
Compen- Stock Options/* outs Compen-
Name Title Year Salary Bonus sation Awarded SARs (#) ($) sation
- ---------- --------- ---- ------ ----- ------ ------- -------- ----- -------
Grayson President, 2002 $750(1) 0 0 0 0 0 0
Hand Secretary,
Treasurer
and
Director
- --------------------------------------------------------------------------------
(1) Paid to WFC Management Corporation pursuant to a management agreement
dated February 1, 2002 in respect of services provided by Grayson Hand
STOCK OPTION GRANTS
We did not grant any stock options to the executive officers during our most
recent fiscal year ended February 28, 2002. We have also not granted any stock
options to the executive officers since February 28, 2002.
EXERCISES OF STOCK OPTIONS AND YEAR-END OPTION VALUES
No stock options were exercised by our officers, directors and employees during
the financial year ended February 28, 2002. No stock options have been
exercised since February 28, 2002.
OUTSTANDING STOCK OPTIONS
We do not have any stock options outstanding.
MANAGEMENT AGREEMENTS
Mr. Grayson Hand, our sole executive officer and one of our directors, provides
his services to us pursuant to a management agreement with WFC Management
Corporation, a company controlled by Mr. Hand. We pay WFC Management
Corporation a management fee of $750 per month payable on the last day of each
month for a one-year term expiring January 31, 2003 in consideration for WFC
Management Corporation providing management and administration services to us,
including telephone and computer services. These services include the services
of Mr. Hand and provide that the consulting fee will be increased to an amount
equal to the fair market value of Mr. Hand's services if Mr. Hand is required to
devote more than 15% of his business time to LaSalle Resources. Amendments or
termination of the consulting agreement must be in writing. We presently do not
have any agreement with Mr. Hand as to the basis on which the fair market value
of Mr. Hand's services will be calculated if Mr. Hand is required to devote more
than 15% of this business time to our business.
We do not have any employment or consultant agreement with Mr. Heard and we do
not pay Mr. Heard any amount for acting as a director of the Company.
35
Financial Statements
Index to Financial Statements:
1. Auditors' Report;
2. Audited Financial Statements for the period ending February 28, 2002,
including:
a. Balance Sheet as at February 28, 2002;
b. Statement of Loss and Deficit for the period from inception, December
3, 2001, to February 28, 2002;
c. Statement of Cash Flows for the period from inception, December 3,
2001, to February 28, 2002;
d. Statement of Stockholders' Equity for the period from inception,
December 3, 2001, to February 28, 2002; and
e. Notes to Financial Statements.
3. Unaudited Financial Statements for the interim period ending May 31, 2002,
including:
a. Balance Sheet as at May 31, 2002;
b. Statement of Loss and Deficit for the three month period ending May
31, 2002 and from the period of inception, December 3, 2001 to May
31, 2002:
c. Statement of Cash Flows for the three month period ending May 31,
2002 and from the period of inception, December 3, 2001 to May 31,
2002;
d. Statement of Stockholders' Equity for the three month period ending
May 31, 2002 and from the period of inception, December 3,2001 to May
31, 2002; and
e. Notes to Financial Statements.
36
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
FINANCIAL STATEMENTS
FEBRUARY 28, 2002
(Stated in U.S. Dollars)
MORGAN
& COMPANY
CHARTERED ACCOUNTANTS
AUDITORS' REPORT
To the Directors
LaSalle Resources, Inc.
(An Exploration Stage Company)
We have audited the balance sheet of LaSalle Resources, Inc. (an exploration
stage company) as at February 28, 2002 and the statements of loss and deficit
accumulated during the exploration stage, cash flows, and stockholders' equity
for the period from December 3, 2001 (date of inception) to February 28, 2002.
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 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 February 28, 2002 and the
results of its operations and cash flows for the period from December 3, 2001
(date of inception) to February 28, 2002 in accordance with United States
generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 1(c) to the financial
statements, the Company incurred a net loss of $8,612 since inception, has not
attained profitable operations and is dependent upon obtaining adequate
financing to fulfil its exploration activities. These factors raise substantial
doubt that the Company will be able to continue as a going concern.
Management's plans in regard to these matters are also discussed in Note 1(c).
The financial statements do not include any adjustments that might result from
the outcome of this uncertainty.
Vancouver, B.C. /s/ Morgan & Company
April 5, 2002 Chartered Accountants
Tel: (604) 687-5841 MEMBER OF P.O. Box 10007 Pacific Centre
Fax: (604) 687-0075 ACPA Suite 1488 - 700 West Georgia Street
www.morgan-cas.com INTERNATIONAL Vancouver, B.C. V7Y 1A1
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
BALANCE SHEET
FEBRUARY 28, 2002
(Stated in U.S. Dollars)
- ------------------------------------------------------------------
ASSETS
Current
Cash $73,942
Mineral Property Interest (Note 3) -
--------
$73,942
==================================================================
LIABILITIES
Current
Accounts payable and accrued liabilities $ 6,011
Advances due to director 1,563
--------
7,574
--------
SHAREHOLDERS' EQUITY
Share Capital
Authorized:
100,000,000 common shares, par value
$0.001 per share
10,000,000 preferred shares, par value
$0.001 per share
Issued and outstanding:
11,532,000 common shares 11,532
Additional paid-in capital 63,448
Deficit Accumulated During The Exploration Stage (8,612)
--------
66,368
--------
$73,942
==================================================================
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
STATEMENT OF LOSS AND DEFICIT
PERIOD FROM DATE OF INCEPTION, DECEMBER 3, 2001,
TO FEBRUARY 28, 2002
(Stated in U.S. Dollars)
- --------------------------------------------------------
Expenses
Bank charges and foreign exchange $ 101
Management fees 750
Mineral property option payments 1,000
Mineral property exploration expenditures 999
Professional fees 5,762
-----------
Net Loss For The Period 8,612
Deficit Accumulated During The
Exploration Stage, Beginning Of Period -
-----------
Deficit Accumulated During The
Exploration Stage, End Of Period $ 8,612
========================================================
Net Loss Per Share $ (0.01)
========================================================
Weighted Average Number Of
Shares Outstanding 3,551,500
========================================================
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
STATEMENT OF CASH FLOWS
PERIOD FROM DATE OF INCEPTION, DECEMBER 3, 2001,
TO FEBRUARY 28, 2002
(Stated in U.S. Dollars)
- ------------------------------------------------------
Cash Flows From Operating Activities
Net loss for the period $ (8,612)
Adjustments To Reconcile Net Loss To
Net Cash Used By Operating Activities
Accounts payable and accrued liabilities 6,011
---------
(2,601)
---------
Cash Flows From Financing Activities
Advances due to director 1,563
Share capital issued 74,980
---------
76,543
---------
Increase In Cash 73,942
Cash, Beginning Of Period -
---------
Cash, End Of Period $ 73,942
======================================================
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
FEBRUARY 28, 2002
(Stated in U.S. Dollars)
Common Stock
------------------------------
Additional
Paid-In
Shares Amount Capital Deficit Total
--------------------------------------------------
Opening balance,
December 3, 2001 - $ - $ - $ - $ -
January - Shares issued for
cash at $0.001 7,000,000 7,000 - - 7,000
February - Shares issued for
cash at $0.015 4,532,000 4,532 63,448 - 67,980
Net loss for the period - - - (8,612) (8,612)
--------------------------------------------------
Balance, February 28, 2002 11,532,000 $11,532 $ 63,448 $ (8,612) $66,368
==================================================
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 2002
(Stated in U.S. Dollars)
1. NATURE OF OPERATIONS
a) Organization
The Company was incorporated in the State of Nevada, U.S.A., on December 3,
2001. The Company's intended year end is February 28, 2002.
b) Exploration Stage Activities
The Company has been in the exploration stage since its formation and has not
yet realized any revenues from its planned operations. It is primarily engaged
in the acquisition and exploration of mining properties. Upon location of a
commercial minable reserve, the Company expects to actively prepare the site for
its extraction and enter a development stage.
c) Going Concern
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern.
As shown in the accompanying financial statements, the Company has incurred a
net loss of $8,612 for the period from December 3, 2001 (inception) to February
28, 2002, and has no sales. The future of the Company is dependent upon its
ability to obtain financing and upon future profitable operations from the
development of its mineral properties. Management has plans to seek additional
capital through a private placement and public offering of its common stock.
The financial statements do not include any adjustments relating to the
recoverability and classification of recorded assets, or the amounts of and
classification of liabilities that might be necessary in the event the Company
cannot continue in existence.
2. SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Company have been prepared in accordance with
generally accepted accounting principles in the United States. Because a
precise determination of many assets and liabilities is dependent upon future
events, the preparation of financial statements for a period necessarily
involves the use of estimates which have been made using careful judgement.
The financial statements have, in management's opinion, been properly prepared
within reasonable limits of materiality and within the framework of the
significant accounting policies summarized below:
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 2002
(Stated in U.S. Dollars)
2. SIGNIFICANT ACCOUNTING POLICIES (Continued)
a) Mineral Property Option Payments and Exploration Costs
The Company expenses all costs related to the maintenance and exploration of
mineral claims in which it has secured exploration rights prior to establishment
of proven and probable reserves. To date, the Company has not established the
commercial feasibility of its exploration prospects, therefore, all costs are
being expensed.
b) 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 amounts of assets and liabilities, and disclosure of
contingent assets and liabilities at the date of the financial statements, and
the reported amounts of revenues and expenses for the reporting period. Actual
results could differ from these estimates.
c) Foreign Currency Translation
Transactions in foreign currency are translated into U.S. dollars as follows:
i) monetary items at the rate prevailing at the balance sheet date;
ii) non-monetary items at the historical exchange rate;
iii) revenue and expense at the average rate in effect during the applicable
accounting period.
d) Income Taxes
The Company has adopted Statement of Financial Accounting Standards No. 109 -
"Accounting for Income taxes" (SFAS 109). This standard requires the use of an
asset and liability approach for financial accounting, and reporting on income
taxes. If it is more likely than not that some portion or all of a deferred tax
asset will not be realized, a valuation allowance is recognized.
e) Net Loss Per Share
The loss per share is calculated using the weighted average number of common
shares outstanding during the year. Fully diluted loss per share is not
presented, as the impact of the exercise of options is anti-dilutive.
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 2002
(Stated in U.S. Dollars)
3. MINERAL PROPERTY INTEREST
The Company has entered into an option agreement, dated January 17, 2002, to
acquire a 70% interest in three mineral claims located in the Northwest
Territories of Canada.
In order to earn its interest, the Company made a $1,000 cash payment on signing
and must incur exploration expenditures totalling $75,250 as follows:
Exploration expenditures:
- - $24,000 by November 30, 2002;
- - A further $20,000 by November 30, 2003;
- - A further $31,250 by November 30, 2004.
The property is subject to an annual royalty of CDN$50,000 (US$31,250), a 4%
gross overriding royalty and a 2% net smelter return royalty. The Company would
be responsible for 70% of these royalties upon earning its interest in the
property.
4. RELATED PARTY TRANSACTION
During the period ended February 28, 2002, the Company paid management fees of
$750 to a company controlled by a director.
5. CONTINGENCY
Mineral Property
The Company's mineral property interest has been acquired pursuant to an option
agreement. In order to retain its interest, the Company must satisfy the terms
of the option agreement described in Note 3.
6. COMMITMENT
The Company has entered into a management agreement with a company controlled by
a director. The agreement is for management services at $750 per month and
expires on January 31, 2003.
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
FINANCIAL STATEMENTS
MAY 31, 2002
(Unaudited)
(Stated in U.S. Dollars)
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
BALANCE SHEET
(Unaudited)
(Stated in U.S. Dollars)
- -------------------------------------------------------------------
MAY 31 FEBRUARY 28
2002 2002
- -------------------------------------------------------------------
(Unaudited) (Audited)
ASSETS
Current
Cash $ 70,416 $73,942
Mineral Property Interest (Note 4) - -
--------------------
$ 70,416 $73,942
=================================================================
LIABILITIES
Current
Accounts payable and accrued liabilities $ 20,997 $ 6,011
Advances due to director 1,563 1,563
--------------------
22,560 7,574
--------------------
SHAREHOLDERS' EQUITY
Share Capital
Authorized:
100,000,000 common shares, par value
$0.001 per share
10,000,000 preferred shares, par value
$0.001 per share
Issued and outstanding:
11,532,000 common shares 11,532 11,532
Additional paid-in capital 63,448 63,448
Deficit Accumulated During The
Exploration Stage (27,124) (8,612)
--------------------
47,856 66,368
--------------------
$ 70,416 $73,942
=================================================================
Nature Of Operations (Note 2)
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
STATEMENT OF LOSS AND DEFICIT
(Unaudited)
(Stated in U.S. Dollars)
- ------------------------------------------------------------------------
PERIOD FROM
DATE OF
THREE INCEPTION
MONTHS DECEMBER 3
ENDED 2001 TO
MAY 31 MAY 31
2002 2002
- ------------------------------------------------------------------------
Expenses
Bank charges and foreign exchange $ (68) $ 33
Management fees 2,250 3,000
Mineral property option payments - 1,000
Mineral property exploration expenditures 1,029 2,028
Professional fees 13,735 19,497
Stock transfer fees 1,566 1,566
-------------------------
Net Loss For The Period 18,512 27,124
Deficit Accumulated During The Exploration
Stage, Beginning Of Period (8,612) -
-------------------------
Deficit Accumulated During The Exploration
Stage, End Of Period $ (27,124) $ (27,124)
========================================================================
Loss Per Share $ (0.01) $ (0.01)
========================================================================
Weighted Average Number Of Shares Outstanding 11,532,000 3,551,500
========================================================================
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
STATEMENT OF CASH FLOWS
(Unaudited)
(Stated in U.S. Dollars)
- ----------------------------------------------------------------------
PERIOD FROM
DATE OF
THREE INCEPTION
MONTHS DECEMBER 3
ENDED 2001 TO
MAY 31 MAY 31
2002 2002
- ----------------------------------------------------------------------
Cash Flows From Operating Activities
Net loss for the period $(18,512) $(27,124)
Adjustments To Reconcile Net Loss To Net Cash
Used By Operating Activities
Accounts payable and accrued liabilities 14,986 20,997
---------------------
(3,526) (6,127)
---------------------
Cash Flows From Financing Activities
Advances due to director - 1,563
Share capital issued - 74,980
---------------------
- 76,543
---------------------
(Decrease) Increase In Cash (3,526) 70,416
Cash, Beginning Of Period 73,942 -
---------------------
Cash, End Of Period $ 70,416 $ 70,416
======================================================================
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
MAY 31, 2002
(Unaudited)
(Stated in U.S. Dollars)
Common Stock
------------------------------
Additional
Paid-In
Shares Amount Capital Deficit Total
--------------------------------------------------
Opening balance,
December 3, 2001 - $ - $ - $ - $ -
January - Shares issued
for cash at $0.001 7,000,000 7,000 - - 7,000
February - Shares issued
for cash at $0.015 4,532,000 4,532 63,448 - 67,980
Net loss for the period - - - (8,612) (8,612)
--------------------------------------------------
Balance, February 28, 2002 11,532,000 11,532 63,448 (8,612) 66,368
Net loss for the period - - - (18,512) (18,512)
--------------------------------------------------
Balance, May 31, 2002 11,532,000 $11,532 $63,448 $(27,124) $ 47,856
==================================================
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2002
(Unaudited)
(Stated in U.S. Dollars)
1. BASIS OF PRESENTATION
The unaudited financial statements as of May 31, 2002 included herein have been
prepared without audit pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with United States
generally accepted accounting principles have been condensed or omitted pursuant
to such rules and regulations. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. It is suggested that these financial
statements be read in conjunction with the February 28, 2002 audited financial
statements and notes thereto.
2. NATURE OF OPERATIONS
a) Organization
The Company was incorporated in the State of Nevada, U.S.A., on December 3,
2001. The Company's intended year end is February 28, 2002.
b) Exploration Stage Activities
The Company has been in the exploration stage since its formation and has not
yet realized any revenues from its planned operations. It is primarily engaged
in the acquisition and exploration of mining properties. Upon location of a
commercial minable reserve, the Company expects to actively prepare the site for
its extraction and enter a development stage.
c) Going Concern
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern.
As shown in the accompanying financial statements, the Company has incurred a
net loss of $27,124 for the period from December 3, 2001 (inception) to May 31,
2002, and has no sales. The future of the Company is dependent upon its ability
to obtain financing and upon future profitable operations from the development
of its mineral properties. Management has plans to seek additional capital
through a private placement and public offering of its common stock. The
financial statements do not include any adjustments relating to the
recoverability and classification of recorded assets, or the amounts of and
classification of liabilities that might be necessary in the event the Company
cannot continue in existence.
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2002
(Unaudited)
(Stated in U.S. Dollars)
3. SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Company have been prepared in accordance with
generally accepted accounting principles in the United States. Because a
precise determination of many assets and liabilities is dependent upon future
events, the preparation of financial statements for a period necessarily
involves the use of estimates which have been made using careful judgement.
The financial statements have, in management's opinion, been properly prepared
within reasonable limits of materiality and within the framework of the
significant accounting policies summarized below:
a) Mineral Property Option Payments and Exploration Costs
The Company expenses all costs related to the maintenance and exploration of
mineral claims in which it has secured exploration rights prior to establishment
of proven and probable reserves. To date, the Company has not established the
commercial feasibility of its exploration prospects, therefore, all costs are
being expensed.
b) 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 amounts of assets and liabilities, and disclosure of
contingent assets and liabilities at the date of the financial statements, and
the reported amounts of revenues and expenses for the reporting period. Actual
results could differ from these estimates.
c) Foreign Currency Translation
Transactions in foreign currency are translated into U.S. dollars as follows:
i) monetary items at the rate prevailing at the balance sheet date;
ii) non-monetary items at the historical exchange rate;
iii) revenue and expense at the average rate in effect during the
applicable accounting period.
d) Loss Per Share
The loss per share is calculated using the weighted average number of common
shares outstanding during the period. Diluted loss per share is not presented,
as the impact of the exercise of options is anti-dilutive.
LASALLE RESOURCES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2002
(Unaudited)
(Stated in U.S. Dollars)
4. MINERAL PROPERTY INTEREST
The Company has entered into an option agreement, dated January 17, 2002, to
acquire a 70% interest in three mineral claims located in the Northwest
Territories of Canada.
In order to earn its interest, the Company made a $1,000 cash payment on signing
and must incur exploration expenditures totalling $75,250 as follows:
Exploration expenditures:
- - $24,000 by November 30, 2002;
- - A further $20,000 by November 30, 2003;
- - A further $31,250 by November 30, 2004.
The property is subject to an annual royalty of CDN$50,000 (US$31,250), a 4%
gross overriding royalty and a 2% net smelter return royalty. The Company would
be responsible for 70% of these royalties upon earning its interest in the
property.
5. CONTINGENCY
Mineral Property
The Company's mineral property interest has been acquired pursuant to an option
agreement. In order to retain its interest, the Company must satisfy the terms
of the option agreement described in Note 3.
6. COMMITMENT
The Company has entered into a management agreement with a company controlled by
a director. The agreement is for management services at $750 per month and
expires on January 31, 2003.
7. SUBSEQUENT EVENT
Subsequent to May 31, 2002, the Company has entered into a $25,500 commitment
for exploration services on the mineral property interest described in Note 3.
The exploration work is to completed by October 31, 2002.
Changes In And Disagreements With Accountants
We have had no changes in or disagreements with our accountants.
Available Information
We have filed a registration statement on form SB-2 under the Securities Act of
1933 with the Securities and Exchange Commission with respect to the shares of
our common stock offered through this prospectus. This prospectus is filed as a
part of that registration statement, but does not contain all of the information
contained in the registration statement and exhibits. Statements made in the
registration statement are summaries of the material terms of the referenced
contracts, agreements or documents of the company. We refer you to our
registration statement and each exhibit attached to it for a more detailed
description of matters involving the company, and the statements we have made in
this prospectus are qualified in their entirety by reference to these additional
materials. You may inspect the registration statement, exhibits and schedules
filed with the Securities and Exchange Commission at the Commission's principal
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. Please
call the Commission at 1-800-SEC-0330 for further information on the operation
of the public reference rooms. The Securities and Exchange Commission also
maintains a web site at http://www.sec.gov that contains reports, proxy
statements and information regarding registrants that file electronically with
the Commission. Our registration statement and the referenced exhibits can also
be found on this site.
37
Part II
Information Not Required In The Prospectus
Item 24. 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 that 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;
(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 the company, or
is or was serving at the request of the company 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 therefore, 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 the
company, except by reason of the fact that such officer is or was a director of
the company 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: (a) by the board of directors by
a majority vote of a quorum consisting of directors who were not parties to the
proceeding, or (b) 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 the company.
38
Item 25. Other Expenses Of Issuance And Distribution
The estimated costs of this offering are as follows:
Securities and Exchange Commission registration fee $ 23
Federal Taxes $ NIL
State Taxes and Fees $ NIL
Transfer Agent Fees $ 1,000
Accounting fees and expenses $ 2,000
Legal fees and expenses $ 20,000
Blue Sky fees and expenses $ 2,000
Miscellaneous $ NIL
--------
Total $ 25,023
========
All amounts are estimates, other than the Commission's registration fee.
We are paying all expenses of the offering listed above. No portion of these
expenses will be borne by the selling shareholders. The selling shareholders,
however, will pay any other expenses incurred in selling their common stock,
including any brokerage commissions or costs of sale.
Item 26. Recent Sales Of Unregistered Securities
We issued 7,000,000 shares of common stock on January 15, 2002 to Mr. Grayson
Hand. Mr. Hand is sole executive officer and one of our directors. These
shares were issued pursuant to Section 4(2) of the Securities Act of 1933 (the
"Securities Act") at a price of $0.001 per share, for total proceeds of $7,000.
The 7,000,000 shares of common stock are restricted shares as defined in the
Securities Act.
We completed an offering of 4,532,000 shares of our common stock at a price of
$0.015 per share to a total of forty-two purchasers on February 28, 2002. The
total amount we received from this offering was $67,980. We completed the
offering pursuant to Regulation S of the Securities Act. Each purchaser
represented to us that he or she was a non-US person as defined in Regulation S.
We did not engage in a distribution of this offering in the United States. Each
purchaser represented his intention to acquire the securities for investment
only and not with a view toward distribution. Appropriate legends were affixed
to the stock certificate issued to each purchaser in accordance with Regulation
S. Each investor was given adequate access to sufficient information about us
to make an informed investment decision. None of the securities were sold
through an underwriter and accordingly, there were no underwriting discounts or
commissions involved. No registration rights were granted to any of the
purchasers.
39
Item 27. Exhibits
Exhibit
Number Description
- ------------ --------------------
3.1 Articles of Incorporation
3.2 Amended By-Laws
4.1 Share Certificate
5.1 Opinion of Cane & Company, LLC, with consent to use
10.1 Option Agreement between the Company and Consolidated
Global Minerals Ltd. dated January 17, 2002
10.2 Management Agreement between LaSalle Resources and
WFC Management Corporation dated February 1, 2002
10.3 Drilling Contract between LaSalle Resources and V.
Emery Drilling & Exploration Ltd.
23.1 Consent of Morgan & Company, Chartered Accountants
23.2 Consent of N.C. Carter, Ph.D. P.Eng
Item 28. Undertakings
The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(a) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(b) To reflect in the prospectus any facts or events which, individually
or together, represent a fundamental change in the information set
forth in this registration statement; provided that any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and 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 the 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.
(c) To include any material information with respect to the plan of
distribution.
2. That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment any of
the securities being registered hereby which remain unsold at the
termination of the offering.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to our directors, officers and controlling persons
pursuant to the provisions above, or otherwise, we have been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act of 1933, and is,
therefore, unenforceable.
In the event that a claim for indemnification against such liabilities, other
than the payment by us of expenses incurred or paid by one of our directors,
officers, or controlling persons in the successful defense of any action, suit
or proceeding, is asserted by one of our directors, officers, or controlling
person sin connection with the securities being registered, we will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification is against public policy as expressed in the Securities Act of
1933, and we will be governed by the final adjudication of such issue.
40
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 to be signed on its behalf by the undersigned, in the City of
Vancouver, British Columbia, Canada on September 6, 2002.
LASALLE RESOURCES, INC.
By: /s/ Grayson Hand
_________________________
Grayson Hand, President
POWER OF ATTORNEY
ALL MEN BY THESE PRESENT, that each person whose signature appears below
constitutes and appoints Grayson Hand, his or her true and lawful
attorney-in-fact and agent, with full power of substitution and re-substitution,
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all pre- or post-effective amendments to this
registration statement, and to file the same with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any one of them, or
their or his substitutes, may lawfully do or cause to be done by virtue hereof.
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities and
on the dates stated.
SIGNATURE CAPACITY IN WHICH SIGNED DATE
/s/ Grayson Hand President, Secretary and Treasurer September 6, 2002
- ------------------ Director
Grayson Hand (Principal Executive Officer,
(Principal Accounting Officer and
Principal Financial Officer)
/s/ George Heard
- ------------------ Director September 6, 2002
George Heard