FORM SB-2
Registration Statement
Under the Securities Act of 1933
Zebra Resources Inc.
(Name of Small Business Issuer in Its Charter)
NEVADA 1000 20-5243308
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification No.)
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410 - 744 West Hastings Street
Vancouver, B.C. Canada V6C 1A5 (604) 961-9212 (604) 689-7422
(Address of principal Executive Offices) (Telephone Number) (Fax Number)
Michael M. Kessler, Esq.
3436 American River Drive, Suite 11
Sacramento, CA 95864 (916) 239-4000 (916) 239-4008
(Name and Address of Agent for Service) (Telephone Number) (Fax Number)
Approximate Date of Commencement of Proposed Sale to the Public: As soon as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [X]
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. [ ]
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 (2) Price (3) Fee (1) -------------------------------------------------------------------------------- Common Stock 12,000,000 $0.005 $60,000 $6.42 ================================================================================ |
(1) Registration Fee has been paid via Fedwire.
(2) This is the initial offering and no current trading market exists for our
common stock. The price paid for the currently issued and outstanding
common stock was valued at $0.001 per share.
(3) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c).
PROSPECTUS
ZEBRA RESOURCES INC.
12,000,000 SHARES
$.005 PER SHARE
This is the initial offering of common stock of Zebra Resources Inc. and no public market currently exists for the securities being offered. Zebra Resources Inc. is offering for sale a total of 12,000,000 shares. The offering is being conducted on a self-underwritten, best effort, all-or-none basis, which means our officer and director will attempt to sell the shares. We intend to open a standard, non-interest bearing, bank checking account to be used only for the deposit of funds received from the sale of the shares in this offering. If all shares are not sold and the total offering amount is not deposited by the expiration date of the offering, the funds will be promptly returned to the investors, without interest or deduction. The shares will be offered at a price of $.005 per share for a period of one hundred and eighty (180) days from the effective date of this prospectus. The offering will end on _______, 200_ (date to be inserted in a subsequent amendment).
Zebra Resources Inc. is an exploration stage company and currently has no operations. Any investment in the shares offered herein involves a high degree of risk. You should only purchase shares if you can afford a loss of your investment. Our independent auditor has issued an audit opinion for Zebra Resources which includes a statement expressing substantial doubt as to our ability to continue as a going concern.
BEFORE INVESTING, YOU SHOULD CAREFULLY READ THIS PROSPECTUS, PARTICULARLY, THE RISK FACTORS SECTION BEGINNING ON PAGE 4.
Neither the U.S. Securities and Exchange Commission nor any state securities division has approved or disapproved these securities, or determined if this prospectus is truthful, accurate, current or complete. Any representation to the contrary is a criminal offense.
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Offering Total
Price Amount of Underwriting Proceeds
Per Share Offering Commissions to Us
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Common Stock $.005 $60,000 $0 $60,000
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As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop.
The information in this prospectus is not complete and may be changed. We will not sell these securities until the registration statement filed with the U.S. Securities and Exchange Commission has been cleared of comments and is declared effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer of sale is not permitted.
Subject to Completion, Dated __________, 200__
TABLE OF CONTENTS
Page No.
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SUMMARY OF PROSPECTUS 3
General Information about Our Company 3
The Offering 3
RISK FACTORS 4
Risks Associated with our Company 4
Risks Associated with this Offering 7
FORWARD LOOKING STATEMENTS 10
USE OF PROCEEDS 10
DETERMINATION OF OFFERING PRICE 10
DILUTION 11
PLAN OF DISTRIBUTION 12
Offering will be Sold by Our Officer and Director 12
Terms of the Offering 13
Deposit of Offering Proceeds 13
Procedures for and Requirements for Subscribing 13
LEGAL PROCEEDINGS 13
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS 14
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 16
DESCRIPTION OF SECURITIES 16
INTEREST OF NAMED EXPERTS AND COUNSEL 17
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES 18
ORGANIZATION WITHIN LAST FIVE YEARS 18
DESCRIPTION OF OUR BUSINESS 18
Glossary 19
General Information 20
Competition 28
Compliance with Government Regulation 29
Patents and Trademarks 29
Need for Any government Approval of Principal Products 30
Research and Development Activities 30
Employees and Employment Agreements 30
Reports to Security Holders 30
PLAN OF OPERATION 30
DESCRIPTION OF PROPERTY 35
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 35
MARKET FOR COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS 35
EXECUTIVE COMPENSATION 38
FINANCIAL STATEMENTS 39
CHANGES IN & DISAGREEMENTS WITH ACCOUNTANTS 39
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SUMMARY
GENERAL INFORMATION
You should read the following summary together with the more detailed business information and the financial statements and related notes that appear elsewhere in this prospectus. In this prospectus, unless the context otherwise denotes, references to "we", "us", "our", "Zebra" and "Zebra Resources" are to Zebra Resources Inc.
Zebra Resources Inc. (the "Company") was incorporated in the State of Nevada on July 20, 2006 to engage in the acquisition, exploration and development of natural resource properties. We intend to use the net proceeds from this offering to develop our business operations. (See "Business of the Company" and "Use of Proceeds".) We are an exploration stage company with no revenues and a limited operating history. The principal executive offices are located at 410 - 744 West Hastings Street, Vancouver, B.C. Canada V6C 1A5. The telephone number is (604) 961-9212.
We received our initial funding of $20,000 through the sale of common stock to our officer and director who purchased 20,000,000 shares of our common stock at $0.001 per share on July 26, 2006. From inception until the date of this filing we have had limited operating activities. Our financial statements from inception (July 20, 2006) through the year ended August 31, 2006 report no revenues and a net loss of $8,575. Our independent auditor has issued an audit opinion for Zebra Resources which includes a statement expressing substantial doubt as to our ability to continue as a going concern.
We have engaged the services of a professional geologist to prepare a geological report. We have not yet commenced any exploration activities on the claim. Our property is without known reserves and there is the possibility that the Astro 2006 mineral property does not contain any reserves and funds that we spend on exploration will be lost. Even if we complete our current exploration program and are successful in identifying a mineral deposit we will be required to expend substantial funds to bring our claim to production.
There is no current public market for our securities. As our stock is not publicly traded, investors should be aware they probably will be unable to sell their shares and their investment in our securities is not liquid.
OFFERING
Securities Being Offered 12,000,000 shares
Price per Shares $0.005
Offering Period The shares are offered for a period not to exceed 180
days, unless extended by our board of directors for
an additional 90 days.
Net Proceeds $60,000 (Total Offering Proceeds)
3
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Securities Issued
and Outstanding 20,000,000 shares of common stock were issued and
outstanding as of the date of this prospectus.
Registration costs We estimate our total offering registration costs to
be $8,800.
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RISK FACTORS
An investment in these securities involves an exceptionally high degree of risk and is extremely speculative in nature. Following are what we believe are all the material risks involved if you decide to purchase shares in this offering.
RISKS ASSOCIATED WITH OUR COMPANY:
WE ARE AN EXPLORATION STAGE COMPANY BUT HAVE NOT YET COMMENCED EXPLORATION ACTIVITIES ON OUR CLAIM. WE EXPECT TO INCUR OPERATING LOSSES FOR THE FORESEEABLE FUTURE.
We have not yet commenced exploration on the Astro 2006 mineral property. Accordingly, we have no way to evaluate the likelihood that our business will be successful. We were incorporated on July 20, 2006 and to date have been involved primarily in organizational activities and the acquisition of the mineral claim through a lease option agreement with Cazador Resources, Ltd. We have not earned any revenues as of the date of this prospectus. Potential investors should be aware of the difficulties normally encountered by new mineral exploration companies and the high rate of failure of such enterprises. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the mineral properties that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates. Prior to completion of our exploration stage, we anticipate that we will incur increased operating expenses without realizing any revenues. We expect to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from development of the Astro 2006 mineral property and the production of minerals from the claim, 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 it is doubtful 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 MANAGEMENT HAS NO TECHNICAL EXPERIENCE IN MINERAL EXPLORATION, OUR BUSINESS HAS A HIGHER RISK OF FAILURE.
Our director has no professional training or technical credentials in the field of geology and specifically in the areas of exploring, developing and operating a mine. As a result, we may not be able to recognize and take advantage of potential acquisition and exploration opportunities in the sector without the aid of qualified geological consultants. Management's decisions and choices may not take into account standard engineering or managerial approaches mineral exploration companies commonly use. Consequently our operations, earnings and ultimate financial success may suffer irreparable harm as a result.
OUR INDEPENDENT AUDITOR HAS ISSUED AN AUDIT OPINION FOR ZEBRA RESOURCES WHICH INCLUDES A STATEMENT DESCRIBING OUR GOING CONCERN STATUS. OUR FINANCIAL STATUS CREATES A DOUBT WHETHER WE WILL CONTINUE AS A GOING CONCERN.
As described in Note 1 of our accompanying financial statements, our limited exploration stage and our lack of any guaranteed sources of future capital create substantial doubt as to our ability to continue as a going concern. If our business plan does not work, we could remain as a start-up company with limited operations and revenues.
WITHOUT THE FUNDING FROM THIS OFFERING WE WILL BE UNABLE TO IMPLEMENT OUR BUSINESS PLAN.
Our current operating funds are less than necessary to complete the intended exploration program on the Astro 2006 mineral property, and therefore we will need the funds from this offering to complete our business plan. As of August 31, 2006, we had cash in the amount of $12,265. We currently do not have any operations and we have no income.
THERE IS THE RISK THAT OUR PROPERTY DOES NOT CONTAIN ANY KNOWN BODIES OF ORE RESULTING IN ANY FUNDS SPENT ON EXPLORATION BEING LOST.
There is the likelihood of our mineral claim containing little or no economic mineralization or reserves of gold, silver, copper or other minerals. We have a geological report detailing previous exploration in the area which included the property being prospected, sampled, staked and circulation drilled. However; there is the possibility that the previous work was not carried out properly and the Astro 2006 property does not contain any reserves, resulting in any funds spent by us on exploration being lost.
BECAUSE WE HAVE NOT SURVEYED THE ASTRO 2006 MINERAL PROPERTY, WE MAY DISCOVER MINERALIZATION ON THE CLAIMS THAT IS NOT WITHIN OUR CLAIM BOUNDARIES.
While we have conducted a mineral claim title search, this should not be construed as a guarantee of claim boundaries. Until the claim is surveyed, the precise location of the boundaries of the claim may be in doubt. If we discover mineralization that is close to the estimated claim boundaries, it is possible that some or all of the mineralization may occur outside the boundaries. In such a case we would not have the right to extract these minerals.
IF WE DISCOVER COMMERCIAL RESERVES OF PRECIOUS METALS ON OUR MINERAL PROPERTY, WE CAN PROVIDE NO ASSURANCE THAT WE WILL BE ABLE TO SUCCESSFULLY ADVANCE THE MINERAL CLAIMS INTO COMMERCIAL PRODUCTION.
If our exploration program is successful in establishing ore of commercial tonnage and grade, we will require additional funds in order to advance the claim into commercial production. Obtaining additional financing would be subject to a number of factors, including the market price for the
minerals, investor acceptance of our claims and general market conditions. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us. The most likely source of future funds presently available to us is through the sale of equity capital. Any sale of share capital will result in dilution to existing shareholders. We may be unable to obtain any such funds, or to obtain such funds on terms that we consider economically feasible and you may lose your investment in this offering.
GOVERNMENT REGULATION OR OTHER LEGAL UNCERTAINTIES MAY INCREASE COSTS AND OUR BUSINESS WILL BE NEGATIVELY AFFECTED.
There are several governmental regulations that materially restrict mineral claim exploration and development. Under Canadian mining law, engaging in certain types of exploration requires work permits, the posting of bonds, and the performance of remediation work for any physical disturbance to the land. While these current laws will not affect our initial exploration phase, if we identify exploitable minerals and proceed to phase two which includes drilling operations on the Astro 2006 mineral property, we will incur regulatory compliance costs based upon the size and scope of our operations. In addition, new regulations could increase our costs of doing business and prevent us from exploring for and the exploitation of ore deposits. In addition to new laws and regulations being adopted, existing laws may be applied to mining that have not as yet been applied. These new laws may increase our cost of doing business with the result that our financial condition and operating results may be harmed.
BASED ON CONSUMER DEMAND, THE GROWTH AND DEMAND FOR ANY ORE WE MAY RECOVER FROM OUR CLAIMS MAY BE SLOWED, RESULTING IN REDUCED REVENUES TO THE COMPANY.
Our continued success will be dependent on the growth of demand for ore. If consumer demand slows our revenues may be significantly affected. This could limit our ability to generate revenues and our financial condition and operating results may be harmed.
THE LOSS OF THE SERVICES OF KARL KOTTMEIER COULD SEVERELY IMPACT OUR BUSINESS OPERATIONS AND FUTURE DEVELOPMENT.
Our performance is substantially dependent upon the professional expertise of our officer Karl Kottmeier. The loss of his services could have an adverse effect on our business operations, financial condition and operating results if we are unable to replace him with other individuals qualified to develop our exploration business. This could result in a loss of revenues, resulting in a reduction of the value of any shares you purchase in this offering.
BECAUSE OUR CURRENT OFFICER HAS OTHER BUSINESS INTERESTS, THEY MAY NOT BE ABLE OR WILLING TO DEVOTE A SUFFICIENT AMOUNT OF TIME TO OUR BUSINESS OPERATIONS, CAUSING OUR BUSINESS TO FAIL.
Karl Kottmeier currently devotes approximately 7 to 10 hours per week providing management services to us. While our executive officer presently possesses adequate time to attend to our interests, it is possible that the demands on him from his other obligations could increase, with the result that he would no longer be able to devote sufficient time to the management of our business. This could negatively impact our business development.
RISKS ASSOCIATED WITH THIS OFFERING:
THE TRADING IN OUR SHARES WILL BE REGULATED BY SECURITIES AND EXCHANGE COMMISSION RULE 15G-9 WHICH ESTABLISHED THE DEFINITION OF A "PENNY STOCK."
The shares being offered are defined as a penny stock under the Securities and Exchange Act of 1934, and rules of the Commission. The Exchange Act and such penny stock rules generally impose additional sales practice and disclosure requirements on broker-dealers who sell our securities to persons other than certain accredited investors who are, generally, institutions with assets in excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 ($300,000 jointly with spouse), or in transactions not recommended by the broker-dealer. For transactions covered by the penny stock rules, a broker-dealer must make a suitability determination for each purchaser and receive the purchaser's written agreement prior to the sale. In addition, the broker-dealer must make certain mandated disclosures in penny stock transactions, including the actual sale or purchase price and actual bid and offer quotations, the compensation to be received by the broker-dealer and certain associated persons, and deliver certain disclosures required by the Commission. Consequently, the penny stock rules may make it difficult for you to resell any shares you may purchase, if at all.
WE ARE SELLING THIS OFFERING WITHOUT AN UNDERWRITER AND MAY BE UNABLE TO SELL ANY SHARES.
This offering is self-underwritten, that is, we are not going to engage the services of an underwriter to sell the shares; we intend to sell them through our officer and director, who will receive no commissions. He plans to offer the shares to friends, relatives, acquaintances and business associates, however; there is no guarantee that he will be able to sell any of the shares. Unless he is successful in selling all of the shares and we receive all of the proceeds from this offering, we may have to seek alternative financing to implement our business plans.
DUE TO THE LACK OF A TRADING MARKET FOR OUR SECURITIES, YOU MAY HAVE DIFFICULTY SELLING ANY SHARES YOU PURCHASE IN THIS OFFERING.
We are not registered on any public stock exchange. There is presently no demand for our common stock and no public market exists for the shares being offered in this prospectus. We plan to contact a market maker immediately following the effectiveness of our Registration Statement and
apply to have the shares quoted on the OTC Electronic Bulletin Board (OTCBB). The OTCBB is a regulated quotation service that displays real-time quotes, last sale prices and volume information in over-the-counter (OTC) securities. The OTCBB is not an issuer listing service, market or exchange. Although the OTCBB does not have any listing requirements per se, to be eligible for quotation on the OTCBB, issuers must remain current in their filings with the SEC or applicable regulatory authority. Market makers are not permitted to begin quotation of a security whose issuer does not meet this filing requirement. Securities already quoted on the OTCBB that become delinquent in their required filings will be removed following a 30 or 60 day grace period if they do not make their required filing during that time. We cannot guarantee that our application will be accepted or approved and our stock listed and quoted for sale. As of the date of this filing, there have been no discussions or understandings between Zebra Resources, or anyone acting on our behalf, with any market maker regarding participation in a future trading market for our securities. If no market is ever developed for our common stock, it will be difficult for you to sell any shares you purchase in this offering. In such a case, you may find that you are unable to achieve any benefit from your investment or liquidate your shares without considerable delay, if at all. In addition, if we fail to have our common stock quoted on a public trading market, your common stock will not have a quantifiable value and it may be difficult, if not impossible, to ever resell your shares, resulting in an inability to realize any value from your investment.
YOU WILL INCUR IMMEDIATE AND SUBSTANTIAL DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES.
Our existing stockholder acquired his shares at a cost of $.001 per share, a cost per share substantially less than that which you will pay for the shares you purchase in this offering. Upon completion of this offering the net tangible book value of the shares held by our existing stockholder (20,000,000 shares) will be increased by $.001 per share without any additional investment on his part. The purchasers of shares in this offering will incur immediate dilution (a reduction in the net tangible book value per share from the offering price of $.005 per Share) of $.003 per share. As a result, after completion of the offering, the net tangible book value of the shares held by purchasers in this offering would be $.002 per share, reflecting an immediate reduction in the $.005 price per share they paid for their shares.
WE WILL BE HOLDING ALL THE PROCEEDS FROM THE OFFERING IN A STANDARD BANK CHECKING ACCOUNT UNTIL ALL SHARES ARE SOLD. BECAUSE THE SHARES ARE NOT HELD IN AN ESCROW OR TRUST ACCOUNT THERE IS A RISK YOUR MONEY WILL NOT BE RETURNED IF ALL THE SHARES ARE NOT SOLD.
All funds received from the sale of shares in this offering will be deposited into a standard bank checking account until all shares are sold and the offering is closed, at which time, the proceeds will be transferred to our business operating account. In the event all shares are not sold we have committed to promptly return all funds to the original purchasers. However since the funds will not be placed into an escrow, trust or other
similar account, there can be no guarantee that any third party creditor who may obtain a judgment or lien against us would not satisfy the judgment or lien by executing on the bank account where the offering proceeds are being held, resulting in a loss of any investment you make in our securities.
WE WILL INCUR ONGOING COSTS AND EXPENSES FOR SEC REPORTING AND COMPLIANCE. WITHOUT REVENUE WE MAY NOT BE ABLE TO REMAIN IN COMPLIANCE, MAKING IT DIFFICULT FOR INVESTORS TO SELL THEIR SHARES, IF AT ALL.
Our business plan allows for the payment of the estimated $8,800 cost of this registration statement to be paid from cash on hand. We plan to contact a market maker immediately following the effectiveness of our Registration Statement and apply to have the shares quoted on the OTC Electronic Bulletin Board. To be eligible for quotation, issuers must remain current in their filings with the SEC. In order for us to remain in compliance we will require future revenues to cover the cost of these filings, which could comprise a substantial portion of our available cash resources. If we are unable to generate sufficient revenues to remain in compliance it may be difficult for you to resell any shares you may purchase, if at all.
MR. KOTTMEIER, THE DIRECTOR AND OFFICER OF THE COMPANY, BENEFICIALLY OWNS 100% OF THE OUTSTANDING SHARES OF OUR COMMON STOCK. AFTER THE COMPLETION OF THIS OFFERING HE WILL BENEFICIALLY OWN 63% OF THE OUTSTANDING SHARES. IF HE CHOOSES TO SELL HIS SHARES IN THE FUTURE, IT MIGHT HAVE AN ADVERSE EFFECT ON THE PRICE OF OUR STOCK.
Due to the controlling amount of Mr. Kottmeier's share ownership in our company, if he chooses to sell his shares in the public market, the market price of our stock could decrease and all shareholders suffer a dilution of the value of their stock. If he does sell any of his common stock, he will be subject to Rule 144 under the 1933 Securities Act. Rule 144 restricts the ability of our director or officer to sell his shares by limiting the sales of securities during any three-month period to the greater of: (1) 1% of the outstanding common stock of the issuer; or (2) the average weekly reported trading volume in the outstanding common stock reported on all securities exchanges during the four calendar weeks preceding the filing of the required notice of the sale under Rule 144 with the SEC.
MR. KOTTMEIER WILL CONTROL AND MAKE CORPORATE DECISIONS THAT MAY DIFFER FROM THOSE THAT MIGHT BE MADE BY THE OTHER SHAREHOLDERS.
Due to the controlling amount of his share ownership in our company Mr. Kottmeier, will have a significant influence in determining the outcome of all corporate transactions, including the power to prevent or cause a change in control. His interests may differ from the interests of the other stockholders and thus result in corporate decisions that are disadvantageous to other shareholders.
FORWARD LOOKING STATEMENTS
This prospectus contains forward-looking statements that involve risk and uncertainties. We use words such as "anticipate", "believe", "plan", "expect", "future", "intend", and similar expressions to identify such forward-looking statements. Investors should be aware that all forward-looking statements contained within this filing are good faith estimates of management as of the date of this filing. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us as described in the "Risk Factors" section and elsewhere in this prospectus.
USE OF PROCEEDS
Assuming sale of all of the shares offered herein, of which there is no assurance, the net proceeds from this Offering will be approximately $60,000. The proceeds are expected to be disbursed, in the priority set forth below, during the first twelve (12) months after the successful completion of the Offering:
Total Proceeds to the Company $60,000
Net Proceeds to the Company $60,000
Phase 1 Exploration Program 15,000
Property Option Payments 5,000
Administration and Office Expense 3,000
Legal and Accounting 4,000
Reserve for Phase II Exploration Program 25,000
Working Capital 8,000
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Total Use of Net Proceeds $60,000
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We will establish a separate bank account and all proceeds will be deposited into that account until the total amount of the offering is received and all shares are sold, at which time the funds will be released to us for use in our operations. In the event we do not sell all of the shares before the expiration date of the offering, all funds will be returned promptly to the subscribers, without interest or deduction. If necessary, Mr. Kottmeier, our director, has verbally agreed to loan the company funds to complete the registration process but we will require full funding to implement our complete business plan.
DETERMINATION OF OFFERING PRICE
The offering price of the shares has been determined arbitrarily by us. The price does not bear any relationship to our assets, book value, earnings, or other established criteria for valuing a privately held company. In determining
the number of shares to be offered and the offering price we took into consideration our cash on hand and the amount of money we would need to implement our business plans. Accordingly, the offering price should not be considered an indication of the actual value of the securities.
DILUTION
Dilution represents the difference between the offering price and the net tangible book value per share immediately after completion of this offering. Net tangible book value is the amount that results from subtracting total liabilities and intangible assets from total assets. Dilution arises mainly as a result of our arbitrary determination of the offering price of the shares being offered. Dilution of the value of the shares you purchase is also a result of the lower book value of the shares held by our existing stockholders.
As of August 31, 2006, the net tangible book value of our shares was $11,425 or $.001 per share, based upon 20,000,000 shares outstanding.
Upon completion of this Offering, but without taking into account any change in the net tangible book value after completion of this Offering other than that resulting from the sale of the shares and receipt of the total proceeds of $60,000, the net tangible book value of the 12,000,000 shares to be outstanding will be $72,560 or approximately $.002 per share. Accordingly, the net tangible book value of the shares held by our existing stockholder (20,000,000 shares) will be increased by $.001 per share without any additional investment on his part. The purchasers of shares in this offering will incur immediate dilution (a reduction in the net tangible book value per share from the offering price of $.005 per share) of $.003 per share. As a result, after completion of the offering, the net tangible book value of the shares held by purchasers in this offering would be $.002 per share, reflecting an immediate reduction in the $.005 price per share they paid for their shares.
After completion of the offering, the existing shareholder will own 63% of the total number of shares then outstanding, for which he will have made an investment of $20,000, or $.001 per share. Upon completion of the offering, the purchasers of the shares offered hereby will own 37% of the total number of shares then outstanding, for which they will have made a cash investment of $60,000, or $.005 per Share.
The following table illustrates the per share dilution to the new investors:
Public Offering Price per Share $ .005 Net Tangible Book Value Prior to this Offering $ .001 Net Tangible Book Value After Offering $ .002 Immediate Dilution per Share to New Investors $ .003 |
The following table summarizes the number and percentage of shares purchased, the amount and percentage of consideration paid and the average price per share paid by our existing stockholder and by new investors in this offering:
Total
Price Number of Percent of Consideration
Per Share Shares Held Ownership Paid
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Existing
Stockholder $ .001 20,000,000 63% $20,000
Investors in
This Offering $ .005 12,000,000 37% $60,000
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PLAN OF DISTRIBUTION
OFFERING WILL BE SOLD BY OUR OFFICERS AND DIRECTORS
This is a self-underwritten offering. This Prospectus is part of a prospectus that permits our officer and director to sell the shares directly to the public, with no commission or other remuneration payable to him for any shares he may sell. There are no plans or arrangements to enter into any contracts or agreements to sell the shares with a broker or dealer. Karl Kottmeier will sell the shares and intends to offer them to friends, family members and business acquaintances. In offering the securities on our behalf, our officer and director will rely on the safe harbor from broker dealer registration set out in Rule 3a4-1 under the Securities Exchange Act of 1934.
Mr. Kottmeier will not register as a broker-dealer pursuant to Section 15 of the Securities Exchange Act of 1934, in reliance upon Rule 3a4-1, which sets forth those conditions under which a person associated with an Issuer may participate in the offering of the Issuer's securities and not be deemed to be a broker-dealer.
a. Mr. Kottmeier is not subject to a statutory disqualification, as that term is defined in Section 3(a)(39) of the Act, at the time of his participation; and,
b. He will not be compensated in connection with his participation by the payment of commissions or other remuneration based either directly or indirectly on transactions in securities; and
c. He is not, nor will be at the time of their participation in the offering, an associated person of a broker-dealer; and
d. He meets the conditions of paragraph (a)(4)(ii) of Rule 3a4-1 of the Exchange Act, in that he (A) primarily performs, or is intended primarily to perform at the end of the offering, substantial duties for or on behalf of our company, other than in connection with transactions in securities; and (B) is not a broker or dealer, or been an associated person of a broker or dealer, within the preceding twelve months; and (C) has not participated in selling and offering securities for any Issuer more than once every twelve months other than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii).
Our officer, director, control person and affiliates of same do not intend to purchase any shares in this offering.
TERMS OF THE OFFERING
The shares will be sold at the fixed price of $.005 per share until the completion of this offering. There is no minimum amount of subscription required per investor, and subscriptions, once received, are irrevocable.
This offering will commence on the date of this prospectus and continue for a period of 180 days (the "Expiration Date").
DEPOSIT OF OFFERING PROCEEDS
This is a "best efforts", "all or none" offering and, as such, we will not be able to spend any of the proceeds unless all the shares are sold and all proceeds are received. We intend to hold all funds collected from subscriptions in a separate bank account until the total amount of $60,000 has been received. At that time, the funds will be transferred to our business account for use in the implementation of our business plan. In the event the offering is not sold out prior to the Expiration Date, all money will be promptly returned to the investors, without interest or deduction. We feel the use of an escrow agent is an expense the company cannot bear at this time. We determined the use of the standard bank account was the most efficient use of our current limited funds. Please see the risk factor section to read the related risk to you as a purchaser of any shares.
PROCEDURES AND REQUIREMENTS FOR SUBSCRIPTION
If you decide to subscribe for any shares in this offering, you will be required to execute a Subscription Agreement and tender it, together with a check or bank draft to us. Subscriptions, once received by the company, are irrevocable. All checks for subscriptions should be made payable to Zebra Resources Inc.
LEGAL PROCEEDINGS
Zebra Resources is not currently involved in any legal proceedings and we are not aware of any pending or potential legal actions.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The directors and officers of Zebra Resources Inc., whose one year terms will expire 8/01/07, or at such a time as their successor(s) shall be elected and qualified are as follows:
Name & Address Age Position Date First Elected Term Expires -------------- --- -------- ------------------ ------------ Karl Kottmeier 38 President, 7/20/06 8/01/07 410-744 W Hastings St Treasurer, Vancouver, BC CFO, CEO & Canada V6C 1A5 Director |
The foregoing person is a promoter of Zebra Resources, as that term is defined in the rules and regulations promulgated under the Securities and Exchange Act of 1933.
Directors are elected to serve until the next annual meeting of stockholders and until their successor has been elected and qualified. Officers are appointed to serve until the meeting of the board of directors following the next annual meeting of stockholders and until their successors have been elected and qualified.
Mr. Kottmeier currently devotes 7 - 10 hours per week to company matters. After receiving funding per our business plan Mr. Kottmeier intends to devote as much time as the board of directors deems necessary to manage the affairs of the company.
No executive officer or director of the corporation has been the subject of any order, judgment, or decree of any court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring, suspending or otherwise limiting him or her from acting as an investment advisor, underwriter, broker or dealer in the securities industry, or as an affiliated person, director or employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities.
No executive officer or director of the corporation has been convicted in any criminal proceeding (excluding traffic violations) or is the subject of a criminal proceeding which is currently pending.
RESUME
KARL KOTTMEIER
1992 Royal Trust - RSP Administrator
1993 McDermid St. Lawrence Chisholm Securities (now Raymond James Ltd)
Hired as broker's assistant and general assistant to the Corporate Finance department. Progressed to become independent broker and full member of corporate finance department.
Developed personal book of business with over 300 clients focusing on proprietary venture capital underwritings. Lead or participated in numerous underwritings annually.
Corporate Finance experience includes sourcing, research, issue structure, finance, listing and syndication.
Resigned Corporate Finance position April 2003.
2003 Leede Financial Markets - Investment Advisor. Resigned October 2004
2004 Sargold Resource Corp. - Vice President, Corporate Communications.
TSX Venture Exchange mineral exploration company. Directly
responsible for all marketing and corporate developments including
finance. Resigned January 2005.
2005 President, Rockgate Capital Corp. TSX Venture listed mineral exploration company. Created, listed and financed company, completing cpc requirements. Company is currently actively exploring optioned gold/silver property in Mexico. Directly responsible for all corporate affairs.
Director, Kitsault Resources Ltd. A private BC registered mineral exploration company.
University of British Columbia, Vancouver, BC |X| 2001
Bachelor of Arts, American History
Annual Continuing Education requirements for Investment Advisors
* Director of Finance, UBC Alma Mater Society, 1988 - 1990
* Assistant Director of Finance UBC, AMS, 1987 - 1988
* House Manager, Phi Gamma Delta Fraternity, 1987 - 1988
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information on the ownership of Zebra Resources' voting securities by officers, directors and major shareholders as well as those who own beneficially more than five percent of our common stock as of the date of this prospectus:
No. of No. of
Shares Shares Percentage of Ownership
Name and Address Before After Before After
Beneficial Owner (1) Offering Offering Offering Offering
---------------- -------- -------- -------- --------
Karl Kottmeier 20,000,000 20,000,000 100% 83%
410-744 W Hastings St
Vancouver, BC
Canada V6C 1A5
All Officers and
Directors as a Group 20,000,000 20,000,000 100% 83%
----------
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(1) The person named above may be deemed to be a "parent" and "promoter" of the Company, within the meaning of such terms under the Securities Act of 1933, as amended, by virtue of his direct holdings in the Company.
DESCRIPTION OF SECURITIES
COMMON STOCK
The authorized capital stock of the Company consists of 75,000,000 shares of Common Stock, par value $.001. The holders of common stock currently (i) have equal ratable rights to dividends from funds legally available therefore, when, as and if declared by the Board of Directors of the Company; (ii) are entitled to share ratably in all of the assets of the Company available for distribution to holders of common stock upon liquidation, dissolution or winding up of the affairs of the Company; (iii) do not have preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights applicable thereto; and (iv) are entitled to one non-cumulative vote per share on all matters on which stockholders may vote. All shares of common stock now
outstanding are fully paid for and non-assessable and all shares of common stock which are the subject of this Offering, when issued, will be fully paid for and non-assessable. Please refer to the Company's Articles of Incorporation, By-Laws and the applicable statutes of the State of Nevada for a more complete description of the rights and liabilities of holders of the Company's securities.
NON-CUMULATIVE VOTING
The holders of shares of common stock of the Company do not have cumulative voting rights, which means that the holders of more than 50% of such outstanding shares, voting for the election of directors, can elect all of the directors to be elected, if they so choose, and, in such event, the holders of the remaining shares will not be able to elect any of the Company's directors. After this Offering is completed, the present stockholder will own 63% of the outstanding shares. (See "Principal Stockholders".)
CASH DIVIDENDS
As of the date of this prospectus, the Company has not declared or paid any cash dividends to stockholders. The declaration or payment of any future cash dividend will be at the discretion of the Board of Directors and will depend upon the earnings, if any, capital requirements and financial position of the Company, general economic conditions, and other pertinent factors. It is the present intention of the Company not to declare or pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in the Company's business operations.
INTEREST OF NAMED EXPERTS AND COUNSEL
None of the below described experts or counsel have been hired on a contingent basis and none of them will receive a direct or indirect interest in the Company.
Our financial statements for the period from inception to the year ended August 31, 2006 included in this prospectus have been audited by De Joya Griffith & Company, LLC, 2425 W. Horizon Ridge Parkway, Henderson, NV 89052. We include the financial statements in reliance on their reports, given upon their authority as experts in accounting and auditing.
The Law Office of Michael M. Kessler, 3436 American River Drive, Suite 11, Sacramento, California 95864, Telephone (916) 239-4000, has passed upon the validity of the shares being offered and certain other legal matters and is representing us in connection with this offering.
Adam Travis, B.Sc. of 5093 Cousins Place, Peachland, B.C. has provided us with the geology report contained herein.
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "Act") may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the By-Laws of the company, 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 Act, and is, therefore unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding) is asserted by such director, officer, or other control person 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 to a court of appropriate jurisdiction the question whether such indemnification by it, is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
ORGANIZATION WITHIN THE LAST FIVE YEARS
Zebra Resources Inc. was incorporated in Nevada on July 20, 2006 to engage in the business of acquisition, exploration and development of natural resource properties. At that time Karl Kottmeier was named Director, President, Secretary and Treasurer of the company. At that time the Board of Directors voted to seek capital and begin development of our business plan. We received our initial funding of $20,000 through the sale of common stock to Mr. Kottmeier who purchased 20,000,000 shares of our Common Stock at $0.001 per share.
DESCRIPTION OF BUSINESS
We are an exploration stage company with no revenues and a limited operating history. Our independent auditor has issued an audit opinion for Zebra Resources which includes a statement expressing substantial doubt as to our ability to continue as a going concern. The source of information contained in this discussion is our geology report that has been included as Exhibit 99.2 to this prospectus.
There is the likelihood of our mineral claim containing little or no economic mineralization or reserves of gold, silver, copper and other minerals. The Astro 2006 mineral property, the only claim currently in the company's portfolio, consists of 8 unpatented mineral claims. There is the possibility that the property does not contain any reserves and funds that we spend on exploration will be lost. Even if we complete our current exploration program and are successful in identifying a mineral deposit we will be required to expend substantial funds on further drilling and engineering studies before we will know if we have a commercially viable mineral deposit or reserve.
GLOSSARY OF MINING TERMS
"Adit" An opening driven horizontally into the side of a
mountain or hill for providing access to a mineral
deposit.
"Andesite" Andesite is an igneous, volcanic rock, of intermediate
composition, with aphanitic to porphyritic texture. Its
mineral assembly is usually quartz and plagioclase.
"Anomalous" A departure from the norm which may indicate the
presence of mineralization
"Argillic-altered" Pertaining to clay or clay minerals; e.g., argillic
alteration in which certain minerals of a rock are
converted to minerals of the clay group.
"Basalt" An extrusive volcanic rock
"BCDM" British Columbia Department of Mines
"Biotite" Biotite is a sheet silicate. Iron magnesium aluminum
silicate forms sheets, and weakly bond together by
potassium ions. It is sometimes called "iron mica".
"Breccia" A rock in which angular fragments are surrounded by a
mass of fine-grained minerals
"Chalcopyrite" A sulphide mineral of copper and iron; the most
important ore mineral in copper
"Chert" A variety of silica that contains microcrystalline
quartz
"Clast or Clastic" Clastic rocks refers to rocks formed from fragments of
pre-existing rock.
"Copper" or "Cu" A reddish or salmon-pink isometric mineral, the native
metallic element of copper. It is ductile and malleable,
a good conductor of heat and electricity, usually dull
and tarnished
"Diamond drill" A rotary type of rock drill that cuts a core of rock
that is recovered in long cylindrical sections
"Fault" A fracture dividing a rock into two sections that have
visibly moved relative to each other
"Feldspar" silicate minerals which occur in igneous rocks -
plagioclase contains calcium and sodium
"Flows" Volcanic rock formed from lava that flowed out onto the
earth's surface
"Geological mapping" The process of observing and measuring geological
features in a given area and plotting these features, to
scale, onto a map
"Geophysical survey" A method of exploration that measures the physical
properties of rock formations including magnetism,
specific gravity, electrical conductivity and resistance
"Gold" A heavy, soft, yellow, ductile, malleable, metallic
element. Gold is a or "Au" critical element in computer
and communications technologies
"Greenstone" Greenstone, also known as greenschist, is a non layered
metamorphic rock derived from basalt, gabbro or similar
rocks containing sodium-rich plagioclase feldspar,
chlorite and quartz.
"Limestone" A sedimentary rock composed primarily of calcium
carbonate
"Massive sulphide
mineralization" Mineralization that contains a variety of different
sulphide minerals - usually includes - sphalerite,
chalcopyrite, pyrite and pyrrhotite.
19
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"Metamorphic" A rock that has undergone chemical or structural changes
(heat, pressure, or a chemical reaction) that causes
changes to its original state - High-grade metamorphic
is a large amount of change
"Mineral claim" A portion of land held either by a prospector or a
mining company, in British Columbia each claim is 500m x
500m (1,640 ft2)
"Molybdemum" A transition metal. The pure metal is silvery white in
color, fairly soft, and has one of the highest melting
points of all pure elements. In small quantities,
molybdenum is effective at hardening steel.
"Ore" A mixture of mineralized rock from which at least one of
the metals can be extracted at a profit
"Porphyrytic" Porphyry is a very hard igneous rock consisting of
large-grained crystals, such as feldspar or quartz,
dispersed in a fine-grained feldspathic matrix or
groundmass.
"Precious metal" Any of several metals, including gold and platinum, that
have high economic value - metals that are often used to
make coins or jewelry
"Pyrite" A yellow iron sulphide mineral - sometimes referred to
as "fools gold"
"Pyrrhotite" A bronze colored, magnetic iron sulphide mineral
"Quartz" Common rock forming mineral consisting of
silicon and oxygen
"Sedimentary rocks" Secondary rocks formed from material derived from other
rocks and laid down underwater.
"Silicified" Combined or impregnated with silicon or silica.
"Silver" or "Ag" A white metallic element that is ductile, very malleable
and capable of a high polish. This precious metal has
major industrial applications in photography, x-rays,
electronics and electrical contacts, batteries, brazing
alloys, catalysts, mirrors, jewelry and sterlingware
"Soil sampling" The collecting of samples of soil, usually 2 pounds per
sample, from soil thought to be covering mineralized
rock. The samples are submitted to a laboratory that
will analyze them for mineral content
"Sphalerite" A zinc sulphide mineral; the most common ore mineral of
zinc
"Stringer" An irregular filament or a narrow vein of one or more
minerals traversing a rock mass.
"Trachyandesite" An extrusive igneous rock. It has little or no free
quartz, but is dominated by alkali feldspar and sodic
plagioclase.
"Trenching" The digging of long, narrow excavation through soil, or
rock, to expose mineralization
"Tuff" Rock composed of fine volcanic ash
"Vein" A crack in the rock that has been filled by minerals
that have traveled upwards from a deeper source
"Volcanic rocks" Igneous rocks formed from magma that has flowed out or
has been violently ejected from a volcano
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"Zinc" or "Zn" A white metallic element
GENERAL INFORMATION
The one property in the Company's portfolio, on which the net proceeds of the offering will be spent, is the Astro 2006 mineral property, consisting of 8 Mineral Titles Online cells listed under Tenure #537414 that were acquired on July 19, 2006. They were a re-stake of claims previously acquired by Adam Travis on April 28, 2003 and are owned 100% by Cazador Resources, a private company
controlled by Adam Travis. On July 26, 2006 Zebra Resources entered into a Mineral Property Option Agreement with Cazador Resources Ltd. which grants to Zebra Resources the sole and exclusive right, privilege and option to explore the Astro 2006 claims. The mineral claims have a total surface area of approximately 168 hectares (415 acres). The property is located 15 km (10 mi) west of Okanagan Falls or 20 km (12 mi) southwest of Penticton in southern British Columbia. Within the property elevations range from 1150 meters (3,773 ft) in the main valley bottom in the southern portion of the claims to over 1400 meters (4,593 ft) in the northern portion.
At the current time the property is without known reserves and the proposed program is exploratory in nature. We have not carried out any exploration work on the claim and have incurred no exploration costs. The future cost of exploration work on the property is disclosed in detail in the Plan of Operation section of this prospectus.
There is not a plant or any equipment currently located on the property. Previous claims were held in the area between 1977-1993 by Pacific Petroleum Ltd. (Petro Canada) in the search for uranium. Work by Placer Development Ltd. from 1984-1986 led to the re-discovery of old workings in the Carboniferous-Triassic cherts to the west of the current claims. Subsequent work by QPX Minerals on both the Placer and Petro Canada claims ensued between 1986-1989. No recorded work has occurred in the area of the current Astro claims since the 1989 RC drilling program.
In 2003 Adam Travis conducted a modest geological and geochemical program consisting of limited soil sampling and an investigation of the small gullies that reflect underlying structures and concluded that soil sampling is partially effective in areas of minor bedrock and that the gullies and structures extend farther than the previous geophysical program.
It is expected that the initial exploration phase will be supported by generators, however; hydro electrical power lines are located in the area. Water required for exploration and development of the claim is available from the major river drainages that flow year round as well as many subsidiary creeks.
The initial phase of exploration will consist of soil sampling and prospecting, geochemical analyses; data evaluation and reporting. We plan to commence the phase one exploration program on the claim in summer or fall 2006. The program should take approximately two months to complete. Following phase one of the exploration program, if it proves successful in identifying mineral deposits and we are able to raise the necessary funds, of which there is no guarantee, we intend to proceed with phase two of our exploration program which will take approximately four months to complete.
Subject to financing, we anticipate commencing the second phase of our exploration program in late spring or summer 2007. We do not have any verbal or written agreement regarding the retention of any qualified engineer or geologist for our planned exploration program. We will require additional funding to proceed with any subsequent recommended drilling work on the claim. We cannot
provide investors with any assurance that we will be able to raise sufficient funds to fund any work after the first phase of the exploration program.
Our geologist believes that the previous work has laid the groundwork to quickly and efficiently build upon the work from more than 15 years ago that has never been followed up. Exploration successes at the nearby Dusty Mac and Vault Projects as well as recent successes in a similar setting at Kinross' Emmanuel Creek Mine in the Republic Camp bode well for renewed exploration in the Astro 2006 area. If a large mineralized vein system is present the project could be developed on a large scale and conversely if a smaller mineralization vein system is present then the property could be developed on a smaller scale.
The discussions contained herein are management's estimates. Because we have not commenced our exploration program we cannot provide a more detailed discussion of our plans if we find a viable store of minerals on our property, as there is no guarantee that exploitable mineralization will be found, the quantity or type of minerals if they are found and the extraction process that will be required. We are also unable to assure you we will be able to raise the additional funding to proceed with any subsequent work on the claims if mineralization is found in Phase 1.
ACQUISITION OF THE ASTRO 2006 MINERAL PROPERTY
On July 26, 2006 Zebra Resources entered into a Mineral Property Option Agreement with Cazador Resources Ltd. which grants to Zebra Resources the sole and exclusive right, privilege and option to explore the Astro 2006 claims together with the sole and exclusive right, privilege and option to purchase the claims upon the following terms and conditions:
1. Zebra shall have the sole and exclusive right and option to acquire a 100% undivided right, title and interest in and to the claims, subject to a 2% net smelter returns royalty payable to Cazador Resources, by performing the acts and deeds and paying the following sums:
(a) Pay to Cazador Resources a total of $15,000 in the following manner:
(i) $5,000 by July 31, 2006;
(ii) an additional $5,000 by July 31, 2007; and
(iii) an additional $5,000 by July 31, 2008;
(b) Pay, or cause to be paid, to Cazador Resources, or on their behalf as Zebra may determine, all claims payments and assessment work required to keep the Claims and the Option in good standing.
2. At such time as Zebra has made all of the required cash payments within the time periods specified, then the Option shall be deemed to have been exercised, and Zebra shall have acquired an undivided 100% interest in and to the Claims, subject to a 2% net smelter returns royalty payable to Cazador Resources, to a maximum of $1,000,000.
3. For so long as the Option continues in full force and effect, Zebra, its employees, agents, permitted assigns and independent contractors shall have the right to:
(a) enter upon the Claims;
(b) incur expenditures;
(c) bring upon and erect upon the Claims such mining facilities as
Zebra may consider advisable; and
(d) remove material from the Claims for testing purposes up to 2
tonnes for a bulk sample.
The mineral title claim has been registered with the Government of British Columbia and a title search has been done to ensure there are no competing claims to the property. The Astro 2006 property, consists of 8 Mineral Titles Online cells listed under Tenure #537414 which were acquired on July 19, 2006. They were a re-stake of claims previously acquired by Adam Travis on April 28, 2003 and are owned 100% by Cazador Resources, a private company controlled by Adam Travis.
REQUIREMENTS OR CONDITIONS FOR RETENTION OF TITLE
All claims staked in British Columbia require $4 per hectare worth of assessment work to be undertaken in year 1 through 3, followed by $8 per hectare per year thereafter. For the Astro 2006 claim this would require $672 in exploration costs for year 1 through 3, and $1,344 per year thereafter. In order to retain title to the property exploration work costs must be recorded and filed with the British Columbia Department of Energy Mines and Petroleum Resources ("BCDM").
LOCATION, ACCESS, CLIMATE, LOCAL RESOURCES & INFRASTRUCTURE
The property is located 15 km (10 mi) west of Okanagan Falls or 20 km (12 mi) southwest of Penticton in southern British Columbia. The claims are most easily accessed via Hwy 3A west from Kaleden for about 12 kilometres (7 mi) to the Sheep Creek Forest Service road turnoff located between Trout and Yellow Lakes. The Sheep Creek road is taken northwesterly for a distance of approximately 7 kilometres (4 mi) to the claim area.
The project is located less than a one hour drive to the towns of Okanagan Falls and Penticton, BC. Each of these towns has a population in excess of 5,000 people The population within a 2 hour radius of the project area, including Kelowna BC is in excess of 250,000. All of the corresponding requirements for a population base of this size are immediately available including hospitals, fire and ambulance services, policing, and government agencies. This part of British
Columbia has a long history in the natural resource industry including mining and logging operations. Both industries are active in the area with ample amounts of experienced workers to draw from. Infrastructure is ideal with numerous mining exploration contractors, drilling companies, heavy equipment operators and support companies available in the immediate area.
TOPOGRAPHY AND PHYSIOGRAPHY
The Astro property is situated in the southern Okanagan area of British Columbia. The region has a relatively dry climate, and snow cover in winter is generally moderate. The climate in the area is semi arid with moderately warm summers and cold dry winters. Typical temperature ranges are from mid to upper 30's C (90 degrees F) in summer and -10 to -20 C (0 to 15 degrees F) in winter. Within the Astro property elevations range from 1150 metres (3773 feet) in the main valley bottom in the southern portion of the claims to over 1400 metres (4593 feet) in the northern portion of the claims. Slopes are generally moderate however small bluffs and steeper slopes do occur near the central portions of the claims. Southerly draining creeks and gullies on the claims are generally intermittent and most likely reflect underlying structures. For the most part vegetation consists of jackpine forest, some of which has been infected with pine beetles.
HISTORY AND PREVIOUS WORK
The earliest record of work in the area dates back to the late 1800's with the discovery of the Giant Mascot and Hedley deposits to the west. Gold was also discovered on the nearby Dividend and Apex Mountains in the early 1900's. Several deposits from which a significant amount of gold, silver and molybdenum was shipped were discovered at Olalla in the 1920's.
In the late 1960's there was renewed interest in the area for copper exploration.
The Astro claims were staked by Pacific Petroleum Ltd. (Petro Canada) in 1977 and 1979 during uranium exploration.
In 1988 QPX Minerals completed 23 trenches totaling 650 meters (2133 ft). During the 1988 exploration, an argillic-altered and silicified system was discovered on the Astro 34 claim in biotite porphyritic andesite of the Marron volcanics. This is the area now covered by the current Astro 2006 property.
In 1993 the claim database indicates that Petro Canada was owner of the Astro 34 claim and that they let the claim lapse.
No recorded work has occurred in the area of the current Astro claims since a 1989 RC drilling program, even though the last recorded work recommended extensions of grid coverage for VLF-EM/Mag, a test soil survey over the showing area, and trenching and drilling of the current geophysical anomalies.
[Figure 1: Location Map]
[Figure 2: Astro 2006 claim, Map Scale - 1:100,000]
REGIONAL GEOLOGY
In 2003 Adam Travis conducted a modest geological and geochemical program consisting of limited soil sampling and an investigation of the small gullies that reflect underlying structures and concluded that soil sampling is partially effective in areas of minor bedrock and that the gullies and structures extend farther than the previous geophysical program.
The showing area lies along the western margin of a fault-bounded basin of Eocene Penticton Group rocks (shown in tan on following figure). To the west Carboniferous to Triassic Shoemaker Formation rocks (shown as blue on following figure) consisting mainly of blue-grey chert, minor limestone and greenstone that have been intruded by pyroxenite, hornblendite and serpentinite. The contact between the chert and greenstone (widely silicified) is gradational over widths of up to 10 meters (33 ft). Bedding strikes northeast with moderate to steep dips to the southeast. To the east at the base of the Penticton Group lies the Springbrook Formation that consists of massive, unsorted, polymictic conglomerate and breccia with lesser sandstone and tuff. The matrix of the
conglomerate and breccia is silty and green. Clasts are dominantly volcanic (45 %) and chert (35%) with lesser metamorphic rocks (10%), sediments (5%) and intrusions (5%). This is overlain by trachyandesite and andesite flows with conspicuous clots of feldspar. Several north-trending faults also cut through the area and probably represent downthrown blocks as part of the Trout Lake Graben.
[Figure 3: Regional Geology and Mineral Showings (Scale - 1:250,000]
LOCAL AND PROPERTY MINERALIZATION
Two styles of gold mineralization are noted in the immediate area and consist of east-west trending small pyrite-arsenopyrite stringers in chert breccia of the Shoemaker Formation at the PDL occurrence and in argillic and silicificied systems in biotite porphyritic andesite of the Marron volcanics at the Astro occurrence.
The highest results from the pyrite-arsenopyrite stringers at PDL were from grab sample PDL-556 in 1987 which yielded 30.3 g/t Au, 22.5 g/t Ag, 0.25% Cu, 0.14% Pb, 0.57 % Zn and 3.74% As. An abandoned 10 meter (33 ft) adit and an old trench in area also exposed small discontinuous massive sulphide lenses.
More pertinent and covered by the current Astro 2006 claims is the argillic altered and silicified system, which is up to 20 meters (66 ft) wide, where tested over an open ended strike length of 140 meters (459 ft). The argillic alteration envelops a silicified core, up to 3 meters (10 ft) wide, however reverse circulation drilling indicates a widening of silicification to 14 meters (154 ft) true width at a depth of 47 meters (154 ft). This may be the result of the merging of two zones at depth, which appear to dip near vertical and occur along north trending faults. Anomalous gold (up to 0.70 g/t), silver (up to 14.8 g/t) and molybdenum (up to 0.15%) values, over 3 meter (10 ft) sections from the drilling were found to be associated with chalcedonic veinlets in the argillically altered Maaron volcanics.
During previous geological investigations by the geologist it was noted that the north trending structure(s) that intersect the 50 m x 100 m (164 ft x 328 ft) area investigated in 1988 and 1989 continue to the north for over 1 kilometre (2/3 mi) and south for at least 300 meters (984 ft) where the inferred structure enters valley cover. The area to the north is now easily accessed with fairly recent selective logging.
COMPETITION
We do not compete directly with anyone for the exploration or removal of minerals from our property as we hold all interest and rights to the claim. Readily available commodities markets exist in Canada and around the world for the sale of gold, silver, copper and other minerals. Therefore, we will likely be able to sell any gold, copper or other minerals that we are able to recover.
We will be subject to competition and unforeseen limited sources of supplies in the industry in the event spot shortages arise for supplies such as dynamite, and certain equipment such as bulldozers and excavators that we will need to conduct exploration. We have not yet attempted to locate or negotiate with any suppliers of products, equipment or services and will not do so until funds are received from this offering. If we are unsuccessful in securing the products, equipment and services we need we may have to suspend our exploration plans until we are able to do so.
BANKRUPTCY OR SIMILAR PROCEEDINGS
There has been no bankruptcy, receivership or similar proceeding.
REORGANIZATIONS, PURCHASE OR SALE OF ASSETS
There have been no material reclassifications, mergers, consolidations, or purchase or sale of a significant amount of assets not in the ordinary course of business.
COMPLIANCE WITH GOVERNMENT REGULATION
We will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to the exploration of minerals in Canada generally, and in British Columbia specifically.
The initial steps of exploration can be carried out without permitting or notification to any government body as it is deemed "low-disturbance/low-impact" by the British Columbia Department of Energy Mines and Petroleum Resources (BCDM).
With respect to the mechanized trenching or diamond drilling a plan of operation will need to be filed with the BCDM. This plan will detail the extent, location and amount of surface disturbance for the trenching and/or drilling. As the amount of trenching and drilling (initially) will be limited, the permit should be issued within 30 days. We will be required to obtain a refundable bond in the amount of $3,000 - $5,000 (depending on the anticipated amount of disturbance). The bond is to ensure that we reclaim or repair the disturbance caused by the trenching and drilling. Usually this reclaiming work entails filling in and smoothing the surface at trenching sites, clean up and removal of any work material, and seeding native grass/plants at the site of any disturbance.
In the event that trees larger than 6 inches in diameter need to be cut down, a permit will need to be obtained from the BC Ministry of Forests. This usually takes less than 30 days to obtain. We will try to adjust the areas we work at and trench around larger trees (initially) to avoid any disturbance to larger trees. If the disturbance to larger trees is unavoidable then a permit to cut will be obtained.
There are nominal costs involved in obtaining the BCDM or Forestry permits (less than $100.00). The bond required by the BCDM is returned (with interest) upon proper clean up of the site. There will be costs for the crew and equipment required to fill in the trenches etc., but as heavy equipment is available locally, and the amount of disturbance is expected to be minimal, the costs will be most likely be less than $2,000. (1 day - crew & equipment)
All claims staked in British Columbia require $4 per hectare worth of assessment work to be undertaken in year 1 through 3, followed by $8 per hectare per year thereafter. In order to retain title to the property exploration work costs must be recorded and filed with the British Columbia Department of Energy Mines and Petroleum Resources ("BCDM"). The BCDM charges a filing fee, equal to 10% of the value of the work recorded, to record the work.
PATENTS, TRADEMARKS, FRANCHISES, CONCESSIONS, ROYALTY AGREEMENTS, OR LABOR CONTRACTS
We have no current plans for any registrations such as patents, trademarks, copyrights, franchises, concessions, royalty agreements or labor contracts. We will assess the need for any copyright, trademark or patent applications on an ongoing basis.
NEED FOR GOVERNMENT APPROVAL FOR ITS PRODUCTS OR SERVICES
We are not required to apply for or have any government approval for our products or services.
RESEARCH AND DEVELOPMENT COSTS DURING THE LAST TWO YEARS
We have not expended funds for research and development costs since inception. We paid $5,000 US for the geology report.
NUMBER OF EMPLOYEES
We currently have one employee, which is our executive officer, namely, Karl Kottmeier. Mr. Kottmeier currently devotes 7 - 10 hours per week to company matters and after receiving funding he plans to devote as much time as the board of directors determines is necessary to manage the affairs of the company. There are no formal employment agreements between the company and Mr. Kottmeier.
REPORTS TO SECURITIES HOLDERS
We provide an annual report that includes audited financial information to our shareholders. We will make our financial information equally available to any interested parties or investors through compliance with the disclosure rules of Regulation S-B for a small business issuer under the Securities Exchange Act of 1934. We will become subject to disclosure filing requirements once our SB-2 registration statement becomes effective, including filing Form 10K-SB annually and Form 10Q-SB quarterly. In addition, we will file Form 8K and other proxy and information statements from time to time as required. We do not intend to voluntarily file the above reports in the event that our obligation to file such reports is suspended under the Exchange Act. The public may read and copy any materials that we file with the Securities and Exchange Commission, ("SEC"), at the SEC's Public Reference Room at 100 F Street NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site (http://www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.
PLAN OF OPERATION
Our current cash balance is $12,265. We believe our cash balance is sufficient to fund our limited levels of operations. If we experience a shortage of funds prior to funding we may utilize funds from Mr. Kottmeier, our director, who has informally agreed to advance funds to allow us to pay for offering costs, filing fees, and professional fees, however he has no formal commitment, arrangement or legal obligation to advance or loan funds to Zebra Resources. In order to achieve our business plan goals, we will need the funding from this offering. We
are an exploration stage company and have generated no revenue to date. We have sold $20,000 in equity securities to pay for our minimum level of operations.
Our auditor has issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated revenues and no revenues are anticipated until we begin removing and selling minerals. There is no assurance we will ever reach that point.
Our exploration target is to find exploitable minerals on our property. Our success depends on achieving that target. There is the likelihood of our mineral claim containing little or no economic mineralization or reserves of gold, silver copper and other minerals. There is the possibility that the Astro 2006 mineral property does not contain any reserves and funds that we spend on exploration will be lost. Even if we complete our current exploration program and are successful in identifying a mineral deposit we will be required to expend substantial funds to bring our claim to production. We are unable to assure you we will be able to raise the additional funds necessary to implement any future exploration or extraction program even if mineralization is found.
Our plan of operation for the twelve months following the date of this prospectus is to complete the first phase of exploration programs on the Astro 2006 mineral property consisting of soil sampling and prospecting, geochemical analyses; data evaluation and reporting. In addition to the $15,000 we anticipate spending for Phase I of the exploration program as outlined below, we anticipate spending an additional $40,000 on professional fees, including fees payable in connection with the filing of this registration statement and complying with reporting obligations, general administrative costs, and lease option payments. We will also set aside a reserve of $25,000 towards Phase II of the exploration program costs. Total expenditures over the next 12 months are therefore expected to be $80,000, which is the amount to be raised in this offering and our cash on hand. We will require the funds from this offering to proceed.
ASTRO 2006 COSTS
PHASE 1 Cost
------- ----
Soil sampling and prospecting (14 mandays) 7,000
Geochemical Analyses (150 soils, 50 rocks) 5,000
Data evaluation and reporting 2,000
Contingency 1,000
subtotal 15,000
------
PHASE 2
-------
Geophysical Surveys ( 35 km Mag-VLF) 35,000
Trenching- excavator (100 hours @ $125/hr) 12,500
Trenching-sampling (500 rocks) 12,500
Geological supervision 5,000
Data evaluation and reporting 5,000
Contingency 5,000
subtotal 75,000
------
GRAND TOTAL 90,000
======
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The above program costs are management's estimates based upon the recommendations of the professional geologist's report and the actual project costs may exceed our estimates. To date, we have not commenced exploration on the Astro 2006 mineral property.
We plan to commence the phase one exploration program on the claim in fall 2006. The program should take approximately two months to complete. Following phase one of the exploration program, if it proves successful in identifying mineral deposits and we are able to raise the necessary funds, of which there is no guarantee, we intend to proceed with phase two of our exploration program. The estimated cost of this program is $75,000 and will take approximately four months to complete.
Subject to financing, we anticipate commencing the second phase of our exploration program in late spring or summer 2007. We do not have any verbal or written agreement regarding the retention of any qualified engineer or geologist for our planned exploration program. We will require additional funding to proceed with any subsequent recommended drilling work on the claim. We cannot provide investors with any assurance that we will be able to raise sufficient funds to fund any work after the first phase of the exploration program.
OFF-BALANCE SHEET ARRANGEMENTS
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
LIMITED OPERATING HISTORY; NEED FOR ADDITIONAL CAPITAL
There is no historical financial information about us on which to base an evaluation of our performance. We are an exploration stage company and have not generated revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in the exploration of our property, and possible cost overruns due to increases in the cost of services.
To become profitable and competitive, we must conduct the exploration of our properties before we start into production of any minerals we may find. We are seeking funding from this offering to provide the capital required for the first phase of our exploration program. We believe that the funds from this offering will allow us to operate for one year.
We have no assurance that future financing will materialize. If that financing is not available to us for the second phase of our exploration program we may be unable to continue or expand our operations.
LIQUIDITY AND CAPITAL RESOURCES
To meet our need for cash we are attempting to raise money from this offering. We cannot guarantee that we will be able to sell all the shares required. If we are successful any money raised will be applied to the items set forth in the Use of Proceeds section of this prospectus. If the first phase of our exploration program is successful in identifying mineral deposits we will attempt to raise the necessary funds to proceed. To provide these funds we may consider a second public offering, a private placement of our securities or loans from our director or others.
Mr. Kottmeier, our director, has agreed to advance funds as needed until the offering is completed or failed and has agreed to pay the cost of reclamation of the property should exploitable minerals not be found and we abandon the second phase of our exploration program. While he has agreed to advance the funds, the agreement is verbal and is unenforceable as a matter of law.
The one property in the Company's portfolio, on which the net proceeds of the offering will be spent, is the Astro 2006 mineral property. At the current time the property is without known reserves and the proposed program is exploratory in nature. We have not carried out any exploration work on the claim and have incurred no exploration costs.
We received our initial funding of $20,000 through the sale of common stock to Mr. Kottmeier, our officer and director, who purchased 20,000,000 shares of our common stock at $0.001 per share on July 26, 2006. From inception until the date of this filing we have had limited operating activities. Our financial statements from inception (July 20, 2006) through the year ended August 31, 2006 report no revenues and a net loss of $8,575.
CRITICAL ACCOUNTING POLICIES
The Company's financial statements are prepared using the accrual method of accounting. The Company's year end is August 31, with its initial period being from July 20, 2006 to August 31, 2006.
USE OF ESTIMATES - The preparation of the 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 amount of revenue and expenses during the reporting period. Actual results could differ from those estimates.
INCOME TAXES - The Company accounts for its income taxes in accordance with Statement of Financial Accounting Standards No. 109, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.
Management feels the Company will have a net operating loss carryover to be used for future years. The Company has not established a valuation allowance for the full tax benefit of the operating loss carryovers due to the uncertainty regarding realization.
NET LOSS PER COMMON SHARE - The Company computes net loss per share in accordance with SFAS No. 128, Earnings per Share (SFAS 128) and SEC Staff Accounting Bulletin No. 98 (SAB 98). Under the provisions of SFAS 128 and SAB 98, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive. For the period from July 20, 2006 (Date of Inception) through August 31, 2006, the Company had no potentially dilutive securities.
STOCK-BASED COMPENSATION - The Company has not adopted a stock option plan and has not granted any stock options. Accordingly no stock-based compensation has been recorded to date.
NEW ACCOUNTING PRONOUNCEMENTS - In December 2004, the FASB issued SFAS No. 123 (revised 2004). Share-Based Payment, is a revision of SFAS No. 123, Accounting for Stock-Based Compensation. SFAS No. 123(R) supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees, and amends SFAS No. 95, Statement of Cash Flows. Generally, the approach in SFAS No. 123(R) is similar to the approach described in SFAS No. 123. However, SFAS No. 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma disclosure is no longer an alternative. The new standard will be effective for the Company in the first interim or annual reporting period beginning after December 15, 2005. The Company does not expect the adoption of this standard will have a material impact on its financial statements.
In December 2004, the FASB issued SFAS No. 153, "Exchanges of Non-monetary Assets, an amendment of APB Opinion No. 29 "effective for non-monetary asset exchanges occurring in the fiscal year beginning January 1, 2006. SFAS No.153 requires that exchanges of productive assets be accounted for at fair value unless fair value cannot be reasonably determined or the transaction lacks commercial substance. SFAS No. 153 is not expected to have a material effect on the company's Consolidated Financial Statements.
In May 2005, the FASB issued SFAS 154, "Accounting Changes and Error Corrections
- a Replacement of APB Opinion No. 20 and FASB Statement No. 3". SFAS 154
requires retrospective application to prior period financial statements of
changes in accounting principle, unless it is impracticable to determine either
the period-specific effects or the cumulative effect of the change. SFAS 154
also redefines "restatement" as the revising of previously issued financial
statements to reflect the correction of an error. This statement is effective
for accounting changes and corrections of errors made in fiscal years beginning
after December 15, 2005. The Company does not believe that the adoption of SFAS
154 will have a significant impact on the financial statements.
DESCRIPTION OF PROPERTY
We currently utilize space at the premises of Karl Kottmeier, the officer and director of the company, on a rent-free basis. The premises are located at 410-744 West Hastings Street, Vancouver BC, Canada V6C 1A5. The facilities include an answering machine, a fax machine, computer and office equipment. We intend to use these facilities for the time being until we feel we have outgrown them. We currently have no investment policies as they pertain to real estate, real estate interests or real estate mortgages.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The principal executive office and telephone number are provided by Mr. Kottmeier, the officer and a director of the corporation, on a rent-free basis.
Mr. Kottmeier will not be paid for any underwriting services that he performs on our behalf with respect to this offering. Mr. Kottmeier will also not receive any interest on any funds that he advances to us for offering expenses prior to the offering being closed. Any funds loaned will be repaid from the proceeds of the offering.
On July 26, 2006, a total of 20,000,000 shares of Common Stock were issued to Mr. Kottmeier in exchange for $20,000 US, or $.001 per share. All of such shares are "restricted" securities, as that term is defined by the Securities Act of 1933, as amended, and are held by an officer and director of the Company. (See "Principal Stockholders".)
During the year ended August 31, 2006 Mr. Kottmeier incurred $840 in expenses on behalf of the company. The amount is included in accounts payable, but there are no specific terms of repayment.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
We plan to contact a market maker immediately following the effectiveness of our Registration Statement and apply to have the shares quoted on the OTC Electronic Bulletin Board (OTCBB). The OTCBB is a regulated quotation service that displays
real-time quotes, last sale prices and volume information in over-the-counter (OTC) securities. The OTCBB is not an issuer listing service, market or exchange. Although the OTCBB does not have any listing requirements per se, to be eligible for quotation on the OTCBB, issuers must remain current in their filings with the SEC or applicable regulatory authority. Market Makers are not permitted to begin quotation of a security whose issuer does not meet this filing requirement. Securities already quoted on the OTCBB that become delinquent in their required filings will be removed following a 30 or 60 day grace period if they do not make their required filing during that time. We cannot guarantee that our application will be accepted or approved and our stock listed and quoted for sale. As of the date of this filing, there have been no discussions or understandings between Zebra Resources, nor, anyone acting on our behalf with any market maker regarding participation in a future trading market for our securities.
As of the date of this filing, there is no public market for our securities. There has been no public trading of our securities, and, therefore, no high and low bid pricing. As of the date of this prospectus Zebra had one shareholder of record. We have paid no cash dividends and have no outstanding options.
PENNY STOCK RULES
The Securities and Exchange Commission has also 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).
A purchaser is purchasing penny stock which limits the ability to sell the stock. The shares offered by this prospectus constitute penny stock under the Securities and Exchange Act. The shares will remain penny stocks for the foreseeable future. The classification of penny stock makes it more difficult for a broker-dealer to sell the stock into a secondary market, which makes it more difficult for a purchaser to liquidate his/her investment. Any broker-dealer engaged by the purchaser for the purpose of selling his or her shares in us will be subject to Rules 15g-1 through 15g-10 of the Securities and Exchange Act. Rather than creating a need to comply with those rules, some broker-dealers will refuse to attempt to sell penny stock.
The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document, which:
- contains a description of the nature and level of risk in the market for penny stock in both public offerings and secondary trading;
- contains a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation of such duties or other requirements of the Securities Act of 1934, as amended;
- contains a brief, clear, narrative description of a dealer market, including "bid" and "ask" price for the penny stock and the significance of the spread between the bid and ask price;
- contains a toll-free telephone number for inquiries on disciplinary actions;
- defines significant terms in the disclosure document or in the conduct of trading penny stocks; and
- contains such other information and is in such form (including language, type, size and format) as the Securities and Exchange Commission shall require by rule or regulation;
The broker-dealer also must provide, prior to effecting any transaction in a penny stock, to the customer:
- the bid and offer quotations for the penny stock;
- the compensation of the broker-dealer and its salesperson in the transaction;
- 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
- 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 suitability statement. These disclosure requirements will have the effect of reducing the trading activity in the secondary market for our stock because it will be subject to these penny stock rules. Therefore, stockholders may have difficulty selling their securities.
REGULATION M
Our officer and director, who will offer and sell the shares, are aware that they are required to comply with the provisions of Regulation M, promulgated under the Securities Exchange Act of 1934, as amended. With certain exceptions, Regulation M precludes the officer and director, sales agent, any broker-dealer or other person who participate in the distribution of shares in this offering from bidding for or purchasing, or attempting to induce any person to bid for or purchase any security which is the subject of the distribution until the entire distribution is complete.
REPORTS
We will become subject to certain filing requirements and will furnish annual financial reports to our stockholders, certified by our independent accountant, and will furnish un-audited quarterly financial reports in our quarterly reports filed electronically with the SEC. All reports and information filed by us can be found at the SEC website, www.sec.gov.
TRANSFER AGENT
The company has not yet retained a transfer agent.
EXECUTIVE COMPENSATION
Our current officer receives no compensation. The current Board of Directors is comprised of Mr. Karl Kottmeier.
Summary Compensation Table
Other
Name & Annual Restricted All Other
Principal Compen- Stock Options LTIP Compen-
Position Year Salary($) Bonus($) sation($) Award(s)($) SARs(#) Payouts($) sation($)
-------- ---- --------- -------- --------- ----------- ------- ---------- ---------
K Kottmeier 2006 -0- -0- -0- -0- -0- -0- -0-
President
|
There are no current employment agreements between the company and its executive officer.
On July 26, 2005, a total of 20,000,000 shares of Common Stock were issued to Mr. Kottmeier in exchange for cash in the amount of $20,000 U.S., or $.001 per share. The terms of this stock issuance was as fair to the company, in the opinion of the Board of Directors, as could have been made with an unaffiliated third party. In making this determination they relied upon the fact that the 20,000,000 shares were valued at par ($0.001) and purchased for $20,000 in cash.
Mr. Kottmeier currently devotes approximately 7 - 10 hours per week to company matters. He has agreed to work with no remuneration until such time as the company receives sufficient revenues necessary to provide management salaries. At this time, management cannot accurately estimate when sufficient revenues will occur to implement this compensation, or what the amount of the compensation will be.
There are no annuity, pension or retirement benefits proposed to be paid to officers, directors or employees in the event of retirement at normal retirement date pursuant to any presently existing plan provided or contributed to by the company or any of its subsidiaries, if any.
FINANCIAL STATEMENTS
The financial statements of Zebra Resources for the year ended August 31, 2006, and related notes, included in this prospectus have been audited by DeJoya Griffith & Company LLC, Certified Public Accountants, and have been so included in reliance upon the opinion of such accountants given upon their authority as an expert in auditing and accounting.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON FINANCIAL DISCLOSURE
None.
To the Board of Directors and Stockholders
Zebra Resources, Inc.
(A Development Stage Company)
Vancouver, B.C. V6C 1A5
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We have audited the accompanying balance sheets of Zebra Resources, Inc. (A Developmental Stage Company) as of August 31, 2006, and the related statements of operations, stockholders' equity, and cash flows for the year ended August 31, 2006 and for the period from July 20, 2006(Inception) through August 31, 2006. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, based on our audit, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of August 31, 2006 and the results of its operations and its cash flows for the year ended August 31, 2006, and for the period from July 20, 2006 (Inception) through August 31, 2006, in conformity with U.S. generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered losses from operations, all of which raise substantial doubt about its ability to continue as a going concern. Management's plans in regards to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ De Joya Griffith & Company, LLC --------------------------------------- De Joya Griffith & Company, LLC October 12, 2006 Henderson, Nevada |
ZEBRA RESOURCES INC.
(An Exploration Stage Enterprise)
Balance Sheet
(Expressed in U.S. Dollars)
CURRENT ASSETS
Total Current Assets $ 12,265
--------
Total Assets $ 12,265
========
|
L I A B I L I T I E S
CURRENT LIABILITIES
Accounts Payable - due to related party 840
Accounts Payable and Accrued Liabilities 10,000
--------
Total Current Liabilities 10,840
--------
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S T O C K H O L D E R S ' E Q U I T Y
COMMON STOCK
75,000,000 authorized shares, par value $.001
20,000,000 shares issued and outstanding 20,000
Additional Paid-in-Capital --
Deficit accumulated during exploration stage (18,575)
--------
Total Stockholders' Equity 1,425
--------
Total Liabilities and Stockholders' Equity $ 12,265
========
|
See accompanying notes to financial statements.
ZEBRA RESOURCES INC.
(An Exploration Stage Enterprise)
Statement of Operations
(Expressed in U.S. Dollars)
REVENUES:
Revenues $ --
============
Total Revenues --
EXPENSES:
Operating Expenses
Exploration Expenses 15,000
General and Adminstrative 1,075
Professional Fees 2,500
------------
Total Expenses 18,575
============
Net loss from Operations $ (18,575)
|
PROVISION FOR INCOME TAXES:
Income Tax Benefit --
------------
Net Income (Loss) for the period $ (18,575)
============
Basic and Diluted Earnings Per Common Share (0.00)
------------
Weighted Average number of Common Shares
used in per share calculations 20,000,000
============
|
See accompanying notes to financial statements.
ZEBRA RESOURCES INC.
(An Exploration Stage Enterprise)
Statement of Stockholders' Equity
For the period from July 20, 2006 (inception) to August 31, 2006
(Expressed in U.S. Dollars)
$0.001 Paid-In Accumulated Stockholders'
Shares Par Value Capital Deficit Equity
------ --------- ------- ------- ------
Balance, July 20, 2006 (Date of Inception) -- $ -- $ -- $ -- $ --
Stock Issued for cash at $0.001 per share
on July 25, 2006 20,000,000 20,000 -- -- 20,000
Net Loss -- -- -- (18,575) (18,575)
---------- -------- ------- ---------- ---------
Balance, August 31, 2006 20,000,000 $ 20,000 $ -- $ (18,575) $ 1,425
========== ======== ======= ========== =========
|
See accompanying notes to financial statements.
ZEBRA RESOURCES INC.
(An Exploration Stage Enterprise)
Statement of Cash Flows
(Expressed in U.S. Dollars)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $(18,575)
Accounts Payable 10,840
--------
Net Cash Provided from Operating Activities (7,735)
--------
CASH FLOWS FROM INVESTING ACTIVITIES:
Other Assets --
--------
Net Cash Used in Investing Activities --
--------
CASH FLOWS FROM FINANCING ACTIVITIES:
Common Stock issued for cash 20,000
--------
Net Cash Provided from Financing Activities 20,000
--------
Net Increase in Cash 12,265
--------
Cash Balance, Begin Period --
--------
Cash Balance, End Period $ 12,265
========
|
See accompanying notes to financial statements.
ZEBRA RESOURCES INC.
(AN EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in U.S. Dollars)
1. DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT POLICIES
DESCRIPTION OF BUSINESS AND HISTORY - Zebra Resources Inc., a Nevada corporation, (hereinafter referred to as the "Company" or "Zebra Resources") was incorporated in the State of Nevada on July 20, 2006. The Company was formed to engage in the acquisition, exploration and development of natural resource properties of merit. The Company acquired a mineral claims option located in the Province of British Columbia, Canada during the initial period ending August 31, 2006 for $5,000.
The Company's operations have been limited to general administrative operations and is considered an Exploration Stage Company in accordance with Statement of Financial Accounting Standards No. 7.
The Company is planning to file an SB-2 Registration Statement in connection with a planned prospectus offering of up to 12,000,000 shares of the Company's common stock at a price of $0.005 per share for gross proceeds of $60,000.
MANAGEMENT OF COMPANY - The Company filed its articles of incorporation with the Nevada Secretary of State on July 20, 2006, indicating Sandra L. Miller on behalf of Resident Agents of Nevada, Inc. as the sole incorporator. The initial list of officers filed with the Nevada Secretary of State on July 24, 2006, indicate Karl Kottmeier as the President, Secretary, and Treasurer.
GOING CONCERN - The Company incurred net losses of approximately $18,575 from the period of July 20, 2006 (Date of Inception) through August 31, 2006 and has commenced limited operations, raising substantial doubt about the Company's ability to continue as a going concern. The Company will seek additional sources of capital through the issuance of debt or equity financing, but there can be no assurance the Company will be successful in accomplishing its objectives.
The ability of the Company to continue as a going concern is dependent on additional sources of capital and the success of the Company's plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
YEAR END - The Company's year end is August 31, with its initial period being from July 20, 2006 to August 31, 2006.
ZEBRA RESOURCES INC.
(AN EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in U.S. Dollars)
USE OF ESTIMATES - The preparation of the 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 amount of revenue and expenses during the reporting period. Actual results could differ from those estimates.
INCOME TAXES - The Company accounts for its income taxes in accordance with Statement of Financial Accounting Standards No. 109, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.
Management feels the Company will have a net operating loss carryover to be used for future years. The Company has not established a valuation allowance for the full tax benefit of the operating loss carryovers due to the uncertainty regarding realization.
NET LOSS PER COMMON SHARE - The Company computes net loss per share in accordance with SFAS No. 128, Earnings per Share (SFAS 128) and SEC Staff Accounting Bulletin No. 98 (SAB 98). Under the provisions of SFAS 128 and SAB 98, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive. For the period from July 20, 2006 (Date of Inception) through August 31, 2006, the Company had no potentially dilutive securities.
STOCK-BASED COMPENSATION - The Company has not adopted a stock option plan and has not granted any stock options. Accordingly no stock-based compensation has been recorded to date.
NEW ACCOUNTING PRONOUNCEMENTS - In December 2004, the FASB issued SFAS No. 123 (revised 2004). Share-Based Payment, is a revision of SFAS No. 123, Accounting for Stock-Based Compensation. SFAS No. 123(R) supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees, and amends SFAS No. 95, Statement of Cash Flows. Generally, the approach in SFAS No. 123(R) is similar to the approach described in SFAS No. 123. However, SFAS No. 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma
ZEBRA RESOURCES INC.
(AN EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in U.S. Dollars)
disclosure is no longer an alternative. The new standard will be effective for the Company in the first interim or annual reporting period beginning after December 15, 2005. The Company does not expect the adoption of this standard will have a material impact on its financial statements.
In December 2004, the FASB issued SFAS No. 153, "Exchanges of Non-monetary Assets, an amendment of APB Opinion No. 29 "effective for non-monetary asset exchanges occurring in the fiscal year beginning January 1, 2006. SFAS No.153 requires that exchanges of productive assets be accounted for at fair value unless fair value cannot be reasonably determined or the transaction lacks commercial substance. SFAS No. 153 is not expected to have a material effect on the company's Consolidated Financial Statements.
In May 2005, the FASB issued SFAS 154, "Accounting Changes and Error Corrections
- a Replacement of APB Opinion No. 20 and FASB Statement No. 3". SFAS 154
requires retrospective application to prior period financial statements of
changes in accounting principle, unless it is impracticable to determine either
the period-specific effects or the cumulative effect of the change. SFAS 154
also redefines "restatement" as the revising of previously issued financial
statements to reflect the correction of an error. This statement is effective
for accounting changes and corrections of errors made in fiscal years beginning
after December 15, 2005. The Company does not believe that the adoption of SFAS
154 will have a significant impact on the financial statements.
In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid Financial Instruments-an amendment of FASB Statements No. 133 and 140", to simplify and make more consistent the accounting for certain financial instruments. SFAS No. 155 amends SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities", to permit fair value remeasurement for any hybrid financial instrument with an embedded derivative that otherwise would require bifurcation, provided that the whole instrument is accounted for on a fair value basis. SFAS No. 155 amends SFAS No. 140, "Accounting for the Impairment or Disposal of Long-Lived Assets", to allow a qualifying special-purpose entity to hold a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. SFAS No. 155 applies to all financial instruments acquired or issued after the beginning of an entity's first fiscal year that begins after September 15, 2006, with earlier application allowed. This standard is not expected to have a significant effect on the Company's future reported financial position or results of operations
In March 2006, the FASB issued SFAS No. 156, "Accounting for Servicing of Financial Assets, an amendment of FASB Statement No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities". This statement requires all separately recognized servicing assets and servicing
ZEBRA RESOURCES INC.
(AN EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in U.S. Dollars)
liabilities be initially measured at fair value, if practicable, and permits for subsequent measurement using either fair value measurement with changes in fair value reflected in earnings or the amortization and impairment requirements of Statement No. 140. The subsequent measurement of separately recognized servicing assets and servicing liabilities at fair value eliminates the necessity for entities that manage the risks inherent in servicing assets and servicing liabilities with derivatives to qualify for hedge accounting treatment and eliminates the characterization of declines in fair value as impairments or direct write-downs. SFAS No. 156 is effective for an entity's first fiscal year beginning after September 15, 2006. The adoption of this statement is not expected to have a significant effect on the Company's future reported financial position or results of operations.
2. PROPERTY AND EQUIPMENT
As of August 31, 2006, the Company does not own any property and/or equipment.
3. STOCKHOLDER'S EQUITY
The Company has 75,000,000 shares authorized with a par value of $0.001 per share.
A total of 20,000,000 shares of the Company's common stock were issued to the founding and sole director of the Company pursuant to a stock subscription agreement at $0.001 per share for total proceeds of $20,000.
4. RELATED PARTY TRANSACTIONS
During the period, Karl Kottmeier, the sole director and officer of the Company incurred $ 840 of expenses on behalf of the Company. As at August 31, 2006, $840 is owing to Mr. Kottmeier and is included in accounts payable and accrued liabilities.
Karl Kottmeier, the sole officer and director of the Company will not be paid for any underwriting services that he performs on behalf of the Company with respect to the Company's upcoming SB-2 prospectus offering.
Mr. Kottmeier will not receive any interest on any funds that he advances to the Company for offering expenses prior to the offering being closed which will be repaid from the proceeds of the offering.
As of August 31, 2006 there are no other related party transactions between the Company and any officers other than those mentioned above.
ZEBRA RESOURCES INC.
(AN EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
(Expressed in U.S. Dollars)
5. STOCK OPTIONS
As of August 31, 2006, the Company does not have any stock options outstanding, nor does it have any written or verbal agreements for the issuance or distribution of stock options at any point in the future.
6. LITIGATION
As of August 31, 2006, the Company is not aware of any current or pending litigation which may affect the Company's operations.
7. SUBSEQUENT EVENTS
The Company expects to file an SB-2 registration statement during October, 2006 with the Securities and Exchange Commission in order to raise an aggregate amount of $60,000 from the sale of 12,000,000 shares of the Company's common stock at a price of $0.005 per share.
Dealer Prospectus Delivery Obligation
"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 DEALERS' OBLIGATION TO DELIVER A
PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS."
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Zebra Resources' By-Laws allow for the indemnification of the officers and directors in regard to their carrying out the duties of their offices. The board of directors will make determination regarding the indemnification of the director, officer or employee as is proper under the circumstances if he/she has met the applicable standard of conduct set forth in the Nevada General Corporation Law.
Section 78.751 of the Nevada Business Corporation Act provides that each corporation shall have the following powers:
"1. A corporation may indemnify 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, except an action by or in the right of the corporation, by reason of any fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding if he acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a pleas of nolo contendere or its equivalent, does not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and that, with respect to any criminal action or proceeding, he had a reasonable cause to believe that his conduct was unlawful.
2. A corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses, including amounts paid in settlement and attorneys fees actually and reasonably incurred by him in connection with the defense or settlement of the action or suit if he acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation. Indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent jurisdiction, after exhaustion of all appeals therefrom, to be liable to the corporation or for amounts paid in settlement to the
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corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent jurisdiction, determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper.
3. To the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in sections 1 and 2, or in defense of any claim, issue or matter therein, he must be indemnified by the corporation against expenses, including attorneys fees, actually and reasonably incurred by him in connection with the defense.
4. Any indemnification under sections 1 and 2, unless ordered by a court or advanced pursuant to section 5, must be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances. The determination must be made:
a. By the stockholders;
b. By the board of directors by majority vote of a quorum consisting of directors who were not parties to the act, suit or proceeding;
c. If a majority vote of a quorum consisting of directors who were not parties to the act, suit or proceeding so orders, by independent legal counsel, in a written opinion; or
d. If a quorum consisting of directors who were not parties to the act, suit or proceeding cannot be obtained, by independent legal counsel in a written opinion.
5. The certificate of articles of incorporation, the bylaws or an agreement made by the corporation may provide that the expenses of officers and directors incurred in defending a civil or criminal action, suit or proceeding must be paid by the corporation as they are incurred and in advance of the final disposition of the action, suit or proceeding, upon receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that he is not entitled to be indemnified by the corporation. The provisions of this section do not affect any rights to advancement of expenses to which corporate personnel other than director or officers may be entitled under any contract or otherwise by law.
6. The indemnification and advancement of expenses authorized in or ordered by a court pursuant to this section:
a. Does not include any other rights to which a person seeking indemnification or advancement of expenses may be entitled under the certificate or articles of incorporation or any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, for either an action in his official capacity or an action in another capacity while
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holding his office, except that indemnification, unless ordered by a court pursuant to section 2 or for the advancement of expenses made pursuant to section 5, may not be made to or on behalf of any director or officer if a final adjudication establishes that his acts or omission involved intentional misconduct, fraud or a knowing violation of the law and was material to the cause of action.
b. Continues for a person who has ceased to be a director, officer, employee or agent and inures to the benefit of the heirs, executors and administrators of such a person.
c. The Articles of Incorporation provides that "the Corporation shall indemnify its officers, directors, employees and agents to the fullest extent permitted by the General Corporation Law of Nevada, as amended from time to time."
As to indemnification for liabilities arising under the Securities Act of 1933 for directors, officers or persons controlling Zebra Resources, we have been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy and unenforceable.
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated costs of the offering are denoted below. Please note all amounts are estimates other than the Commission's registration fee.
Securities and Exchange Commission registration fee $ 6
Accounting fees and expenses $5,000
Legal fees $1,500
Preparation and EDGAR conversion fees $1,300
Transfer Agent fees $ 700
Printing $ 294
------
Total $8,800
======
|
RECENT SALES OF UNREGISTERED SECURITIES
Set forth below is information regarding the issuance and sales of securities without registration since inception. No such sales involved the use of an underwriter; no advertising or public solicitation was involved; the securities bear a restrictive legend; and no commissions were paid in connection with the sale of any securities.
On July 26, 2006, a total of 20,000,000 shares of Common Stock were issued in exchange for $20,000 US, or $.001 per share. These securities were issued to the officer and director of the company.
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EXHIBITS
Exhibit 3.1 Articles of Incorporation Exhibit 3.2 Bylaws Exhibit 5 Opinion re: Legality Exhibit 10 Mineral Property Option Agreement Exhibit 23.1 Consent of counsel (See Exhibit 5) Exhibit 23.2 Consent of independent auditor Exhibit 23.3 Consent of professional geologist (See Appendix 1 of Exhibit 99.2) Exhibit 99.1 Subscription Agreement Exhibit 99.2 Geology Report |
UNDERTAKINGS
The undersigned registrant hereby undertakes:
1. To file, during any period in which offers of sales are being made, a post-effective amendment to this registration statement to:
(i) Include any prospectus required by Section 10(a)(3) of the Securities
Act of 1933;
(ii) Reflect in the prospectus any facts or events which, individually or
together, represent a fundamental change in the information in this
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low and high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes
in volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement ; and
(iii) Include any additional or changed material information on the plan of
distribution.
2. That, for the purpose of determining any liability under the Securities Act, treat each post-effective amendment as a new registration statement of the securities offered herein, and that 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.
4. Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "Act") may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the By-Laws of the company, or otherwise, we have been advised that in the opinion of the
II-4
Securities and Exchange Commission such indemnification is against public policy as expressed in the Act, and is, therefore unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding) is asserted by such director, officer, or other control person 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 to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
5. For determining any liability under the Securities Act, we shall treat the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by us under Rule 424(b)(1), or (4), or 497(h) under the Securities Act as part of this registration statement as of the time the Commission declared it effective.
6. For determining any liability under the Securities Act, we shall treat each post-effective amendment that contains a form of prospectus as a new registration statement for the securities offered in the registration statement, and that the offering of the securities at that time as the initial bona fide offering of those securities.
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe it meets all of the requirements for filing Form SB-2 and authorized this registration statement to be signed on its behalf by the undersigned, in the city of Vancouver BC, on October 23, 2006.
Zebra Resources Inc.
/s/ Karl Kottmeier
-------------------------------
By: Karl Kottmeier
(Principal Executive Officer)
|
In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following person in the capacities and date stated.
/s/ Karl Kottmeier October 23, 2006
------------------------------------- ----------------
Karl Kottmeier, President Date
(Principal Executive Officer, Principal Financial Officer,
Principal Accounting Officer)
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Exhibit 3.1
DEAN HELLER
Secretary of State
206 North Carson Street
Carson City, Nevada 89701-4298
(775) 684-5708 Website: secretaryofstate.biz
Entity #
E0543122006-0
Document Number
20060461658-48
Date Filed:
7/20/2006 2:40:15 PM
In the office of
/s/ Dean Heller
Dean Heller
Secretary of State
|
ARTICLES OF INCORPORATION
(PURSUANT TO NRS 78)
1. Name of Corporation: ZEBRA RESOURCES INCORPORATED
2. Resident Agent Name &
Street Address: Resident Agents of Nevada, Inc.
711 S. Carson Street, Suite 4
Carson City, NEVADA 89701
3. Shares: Number of Shares with par value: 20,000,000
Par value: .001
4. Name & Address of Board
Of Directors/Trustees: Dwight Alan Teegardin
711 S. Carson Street, Suite 4
Carson City, NV 89701
5. Purpose: The purpose of this
Corporation shall be: Any legal
purpose
6. Name, Address & Signature
Of Incorporator: Sandra L. Miller /s/ Sandra L. Miller
711 S. Carson Street, Suite 4
Carson City, NV 89701
7. Certificate of Acceptance
Of Appointment of Resident
Agent: I hereby accept appointment as Resident Agent
for the above named corporation.
/s/ Sandra L. Miller 7/20/2006
Authorized Signature of R.A. Date
|
DEAN HELLER
Secretary of State
206 North Carson Street
Carson City, Nevada 89701-4298
(775) 684-5708 Website: secretaryofstate.biz
Entity #
E0543122006-0
Document Number
20060479473-82
Date Filed:
7/27/2006 7:13:39 AM
In the office of
/s/ Dean Heller
Dean Heller
Secretary of State
|
CERTIFICATE OF AMENDMENT
(PURSUANT TO NRS 78.380)
Certificate of Amendment to Articles of Incorporation For Nevada Profit Corporations
(Pursuant to NRS 78.380 - Before Issuance of Stock)
1. Name of Corporation:
ZEBRA RESOURCES INCORPORATED File #E0543122006-0
2. The articles have been amended as follows:
Articles #3: Shares (number of shares corporation authorized to issue)
Number of Shares with Par Value 75,000,000 Par Value $0.001
3. The undersigned declare that they constitute at least two-thirds of the incorporators, or of the board of directors.
4. Effective date of filing (optional)
5. The undersigned affirmatively declare that to the date of this certificate, no stock of the corporation has been issued.
Signature
/s/ Dwight Alan Teegardin ------------------------- Signature |
Exhibit 3.2
BYLAWS
OF
ZEBRA RESOURCES INC.
ARTICLE I
OFFICES
Section 1.01 Location of Offices. The corporation may maintain such offices within or without the State of Nevada as the Board of Directors may from time to time designate or require.
Section 1.02 Principal Office. The address of the principal office of the corporation shall be at the address of the registered office of the corporation as so designated in the office of the Lieutenant Governor/Secretary of State of the state of incorporation, or at such other address as the Board of Directors shall from time to time determine.
ARTICLE II
SHAREHOLDERS
Section 2.01 Annual Meeting. The annual meeting of the shareholders shall be held in November of each year or at such other time designated by the Board of Directors and as is provided for in the notice of the meeting, for the purpose of electing directors and for the transaction of such other business as may come before the meeting. If the election of directors shall not be held on the day designated for the annual meeting of the shareholders, or at any adjournment thereof, the Board of Directors shall cause the election to be held at a special meeting of the shareholders as soon thereafter as may be convenient.
Section 2.02 Special Meetings. Special meetings of the shareholders may be called at any time by the chairman of the board, the president, or by the Board of Directors, or in their absence or disability, by any vice president, and shall be called by the president or, in his or her absence or disability, by a vice president or by the secretary on the written request of the holders of not less than one-tenth of all the shares entitled to vote at the meeting, such written request to state the purpose or purposes of the meeting and to be delivered to the president, each vice-president, or secretary. In case of failure to call such meeting within 60 days after such request, such shareholder or shareholders may call the same.
Section 2.03 Place of Meetings. The Board of Directors may designate any place, either within or without the state of incorporation, as the place of meeting for any annual meeting or for any special meeting called by the Board of Directors. A waiver of notice signed by all shareholders entitled to vote at a meeting may designate any place, either within or without the state of incorporation, as the place for the holding of such meeting. If no designation is made, or if a special meeting be otherwise called, the place of meeting shall be at the principal office of the corporation.
Section 2.04 Notice of Meetings. The secretary or assistant secretary, if any, shall cause notice of the time, place, and purpose or purposes of all meetings of the shareholders (whether annual or special), to be mailed at least 10 days,
but not more than 50 days, prior to the meeting, to each shareholder of record entitled to vote.
Section 2.05 Waiver of Notice. Any shareholder may waive notice of any meeting of shareholders (however called or noticed, whether or not called or noticed and whether before, during, or after the meeting), by signing a written waiver of notice or a consent to the holding of such meeting, or an approval of the minutes thereof. Attendance at a meeting, in person or by proxy, shall constitute waiver of all defects of call or notice regardless of whether waiver, consent, or approval is signed or any objections are made. All such waivers, consents, or approvals shall be made a part of the minutes of the meeting.
Section 2.06 Fixing Record Date. For the purpose of determining shareholders entitled to notice of or to vote at any annual meeting of shareholders or any adjournment thereof, or shareholders entitled to receive payment of any dividend or in order to make a determination of shareholders for any other proper purpose, the Board of Directors of the corporation may provide that the share transfer books shall be closed, for the purpose of determining shareholders entitled to notice of or to vote at such meeting, but not for a period exceeding 50 days. If the share transfer books are closed for the purpose of determining shareholders entitled to notice of or to vote at such meeting, such books shall be closed for at least 10 days immediately preceding such meeting.
In lieu of closing the share transfer books, the Board of Directors may fix in advance a date as the record date for any such determination of shareholders, such date in any case to be not more than 50 and, in case of a meeting of shareholders, not less than 10 days prior to the date on which the particular action requiring such determination of shareholders is to be taken. If the share transfer books are not closed and no record date is fixed for the determination of shareholders entitled to notice of or to vote at a meeting or to receive payment of a dividend, the date on which notice of the meeting is mailed or the date on which the resolution of the Board of Directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of shareholders. When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this Section, such determination shall apply to any adjournment thereof. Failure to comply with this Section shall not affect the validity of any action taken at a meeting of shareholders.
Section 2.07 Voting Lists. The officer or agent of the corporation having charge of the share transfer books for shares of the corporation shall make, at least 10 days before each meeting of shareholders, a complete list of the shareholders entitled to vote at such meeting or any adjournment thereof, arranged in alphabetical order, with the address of, and the number of shares held by each, which list, for a period of 10 days prior to such meeting, shall be kept on file at the registered office of the corporation and shall be subject to inspection by any shareholder during the whole time of the meeting. The original share transfer book shall be prima facie evidence as to the shareholders who are entitled to examine such list or transfer books, or to vote at any meeting of shareholders.
Section 2.08 Quorum. One-half of the total voting power of the outstanding shares of the corporation entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of the shareholders. If a quorum is
present, the affirmative vote of the majority of the voting power represented by shares at the meeting and entitled to vote on the subject shall constitute action by the shareholders, unless the vote of a greater number or voting by classes is required by the laws of the state of incorporation of the corporation or the Articles of Incorporation. If less than one-half of the outstanding voting power is represented at a meeting, a majority of the voting power represented by shares so present may adjourn the meeting from time to time without further notice. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally noticed.
Section 2.09 Voting of Shares. Each outstanding share of the corporation entitled to vote shall be entitled to one vote on each matter submitted to vote at a meeting of shareholders, except to the extent that the voting rights of the shares of any class or series of stock are determined and specified as greater or lesser than one vote per share in the manner provided by the Articles of Incorporation.
Section 2.10 Proxies. At each meeting of the shareholders, each shareholder entitled to vote shall be entitled to vote in person or by proxy; provided, however, that the right to vote by proxy shall exist only in case the instrument authorizing such proxy to act shall have been executed in writing by the registered holder or holders of such shares, as the case may be, as shown on the share transfer of the corporation or by his or her or her attorney thereunto duly authorized in writing. Such instrument authorizing a proxy to act shall be delivered at the beginning of such meeting to the secretary of the corporation or to such other officer or person who may, in the absence of the secretary, be acting as secretary of the meeting. In the event that any such instrument shall designate two or more persons to act as proxies, a majority of such persons present at the meeting, or if only one be present, that one shall (unless the instrument shall otherwise provide) have all of the powers conferred by the instrument on all persons so designated. Persons holding stock in a fiduciary capacity shall be entitled to vote the shares so held and the persons whose shares are pledged shall be entitled to vote, unless in the transfer by the pledge or on the books of the corporation he or she shall have expressly empowered the pledgee to vote thereon, in which case the pledgee, or his or her or her proxy, may represent such shares and vote thereon.
Section 2.11 Written Consent to Action by Shareholders. Any action required to be taken at a meeting of the shareholders, or any other action which may be taken at a meeting of the shareholders, may be taken without a meeting, if a consent in writing, setting forth the action so taken, shall be signed by a majority of the shareholders entitled to vote with respect to the subject matter thereof.
ARTICLE III
DIRECTORS
Section 3.01 General Powers. The property, affairs, and business of the corporation shall be managed by its Board of Directors. The Board of Directors may exercise all the powers of the corporation whether derived from law or the Articles of Incorporation, except such powers as are by statute, by the Articles
of Incorporation or by these Bylaws, vested solely in the shareholders of the corporation.
Section 3.02 Number, Term, and Qualifications. The Board of Directors shall consist of one to nine persons. Increases or decreases to said number may be made, within the numbers authorized by the Articles of Incorporation, as the Board of Directors shall from time to time determine by amendment to these Bylaws. An increase or a decrease in the number of the members of the Board of Directors may also be had upon amendment to these Bylaws by a majority vote of all of the shareholders, and the number of directors to be so increased or decreased shall be fixed upon a majority vote of all of the shareholders of the corporation. Each director shall hold office until the next annual meeting of shareholders of the corporation and until his or her successor shall have been elected and shall have qualified. Directors need not be residents of the state of incorporation or shareholders of the corporation.
Section 3.03 Classification of Directors. In lieu of electing the entire number of directors annually, the Board of Directors may provide that the directors be divided into either two or three classes, each class to be as nearly equal in number as possible, the term of office of the directors of the first class to expire at the first annual meeting of shareholders after their election, that of the second class to expire at the second annual meeting after their election, and that of the third class, if any, to expire at the third annual meeting after their election. At each annual meeting after such classification, the number of directors equal to the number of the class whose term expires at the time of such meeting shall be elected to hold office until the second succeeding annual meeting, if there be two classes, or until the third succeeding annual meeting, if there be three classes.
Section 3.04 Regular Meetings. A regular meeting of the Board of Directors shall be held without other notice than this bylaw immediately following, and at the same place as, the annual meeting of shareholders. The Board of Directors may provide by resolution the time and place, either within or without the state of incorporation, for the holding of additional regular meetings without other notice than such resolution.
Section 3.05 Special Meetings. Special meetings of the Board of Directors may be called by or at the request of the president, vice president, or any two directors. The person or persons authorized to call special meetings of the Board of Directors may fix any place, either within or without the state of incorporation, as the place for holding any special meeting of the Board of Directors called by them.
Section 3.06 Meetings by Telephone Conference Call. Members of the Board of
Directors may participate in a meeting of the Board of Directors or a committee
of the Board of Directors by means of conference telephone or similar
communication equipment by means of which all persons participating in the
meeting can hear each other, and participation in a meeting pursuant to this
Section shall constitute presence in person at such meeting.
Section 3.07 Notice. Notice of any special meeting shall be given at least 10 days prior thereto by written notice delivered personally or mailed to each director at his or her regular business address or residence, or by telegram. If mailed, such notice shall be deemed to be delivered when deposited in the United
States mail so addressed, with postage thereon prepaid. If notice be given by telegram, such notice shall be deemed to be delivered when the telegram is delivered to the telegraph company. Any director may waive notice of any meeting. Attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except where a director attends a meeting solely for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened.
Section 3.08 Quorum. A majority of the number of directors shall constitute a quorum for the transaction of business at any meeting of the Board of Directors, but if less than a majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time without further notice.
Section 3.09 Manner of Acting. The act of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, and the individual directors shall have no power as such.
Section 3.10 Vacancies and Newly Created Directorship. If any vacancies shall occur in the Board of Directors by reason of death, resignation or otherwise, or if the number of directors shall be increased, the directors then in office shall continue to act and such vacancies or newly created directorships shall be filled by a vote of the directors then in office, though less than a quorum, in any way approved by the meeting. Any directorship to be filled by reason of removal of one or more directors by the shareholders may be filled by election by the shareholders at the meeting at which the director or directors are removed.
Section 3.11 Compensation. By resolution of the Board of Directors, the directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors, and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as director. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor.
Section 3.12 Presumption of Assent. A director of the corporation who is present at a meeting of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless his or her or her dissent shall be entered in the minutes of the meeting, unless he or she shall file his or her or her written dissent to such action with the person acting as the secretary of the meeting before the adjournment thereof, or shall forward such dissent by registered or certified mail to the secretary of the corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action.
Section 3.13 Resignations. A director may resign at any time by delivering a written resignation to either the president, a vice president, the secretary, or assistant secretary, if any. The resignation shall become effective on its acceptance by the Board of Directors; provided, that if the board has not acted thereon within ten days from the date presented, the resignation shall be deemed accepted.
Section 3.14 Written Consent to Action by Directors. Any action required to be taken at a meeting of the directors of the corporation or any other action which may be taken at a meeting of the directors or of a committee, may be taken without a meeting, if a consent in writing, setting forth the action so taken, shall be signed by all of the directors, or all of the members of the committee, as the case may be. Such consent shall have the same legal effect as a unanimous vote of all the directors or members of the committee.
Section 3.15 Removal. At a meeting expressly called for that purpose, one or more directors may be removed by a vote of a majority of the shares of outstanding stock of the corporation entitled to vote at an election of directors.
ARTICLE IV
OFFICERS
Section 4.01 Number. The officers of the corporation shall be a president, one or more vice-presidents, as shall be determined by resolution of the Board of Directors, a secretary, a treasurer, and such other officers as may be appointed by the Board of Directors. The Board of Directors may elect, but shall not be required to elect, a chairman of the board and the Board of Directors may appoint a general manager.
Section 4.02 Election, Term of Office, and Qualifications. The officers shall be chosen by the Board of Directors annually at its annual meeting. In the event of failure to choose officers at an annual meeting of the Board of Directors, officers may be chosen at any regular or special meeting of the Board of Directors. Each such officer (whether chosen at an annual meeting of the Board of Directors to fill a vacancy or otherwise) shall hold his or her office until the next ensuing annual meeting of the Board of Directors and until his or her successor shall have been chosen and qualified, or until his or her death, or until his or her resignation or removal in the manner provided in these Bylaws. Any one person may hold any two or more of such offices, except that the president shall not also be the secretary. No person holding two or more offices shall act in or execute any instrument in the capacity of more than one office. The chairman of the board, if any, shall be and remain a director of the corporation during the term of his or her office. No other officer need be a director.
Section 4.03 Subordinate Officers, Etc. The Board of Directors from time to time may appoint such other officers or agents as it may deem advisable, each of whom shall have such title, hold office for such period, have such authority, and perform such duties as the Board of Directors from time to time may determine. The Board of Directors from time to time may delegate to any officer or agent the power to appoint any such subordinate officer or agents and to prescribe their respective titles, terms of office, authorities, and duties. Subordinate officers need not be shareholders or directors.
Section 4.04 Resignations. Any officer may resign at any time by delivering a written resignation to the Board of Directors, the president, or the secretary. Unless otherwise specified therein, such resignation shall take effect on delivery.
Section 4.05 Removal. Any officer may be removed from office at any special meeting of the Board of Directors called for that purpose or at a regular meeting, by vote of a majority of the directors, with or without cause. Any officer or agent appointed in accordance with the provisions of Section 4.03 hereof may also be removed, either with or without cause, by any officer on whom such power of removal shall have been conferred by the Board of Directors.
Section 4.06 Vacancies and Newly Created Offices. If any vacancy shall occur in any office by reason of death, resignation, removal, disqualification, or any other cause, or if a new office shall be created, then such vacancies or new created offices may be filled by the Board of Directors at any regular or special meeting.
Section 4.07 The Chairman of the Board. The Chairman of the Board, if there be such an officer, shall have the following powers and duties.
(a) He or she shall preside at all shareholders' meetings;
(b) He or she shall preside at all meetings of the Board of Directors; and
(c) He or she shall be a member of the executive committee, if any.
Section 4.08 The President. The president shall have the following powers and duties:
(a) If no general manager has been appointed, he or she shall be the chief executive officer of the corporation, and, subject to the direction of the Board of Directors, shall have general charge of the business, affairs, and property of the corporation and general supervision over its officers, employees, and agents;
(b) If no chairman of the board has been chosen, or if such officer is absent or disabled, he or she shall preside at meetings of the shareholders and Board of Directors;
(c) He or she shall be a member of the executive committee, if any;
(d) He or she shall be empowered to sign certificates representing shares of the corporation, the issuance of which shall have been authorized by the Board of Directors; and
(e) He or she shall have all power and shall perform all duties normally incident to the office of a president of a corporation, and shall exercise such other powers and perform such other duties as from time to time may be assigned to him or her by the Board of Directors.
Section 4.09 The Vice Presidents. The Board of Directors may, from time to time, designate and elect one or more vice presidents, one of whom may be designated to serve as executive vice president. Each vice president shall have such powers and perform such duties as from time to time may be assigned to him or her by the Board of Directors or the president. At the request or in the absence or disability of the president, the executive vice president or, in the absence or disability of the executive vice president, the vice president designated by the Board of Directors or (in the absence of such designation by the Board of Directors) by the president, the senior vice president, may perform all the
duties of the president, and when so acting, shall have all the powers of, and be subject to all the restrictions upon, the president.
Section 4.10 The Secretary. The secretary shall have the following powers and duties:
(a) He or she shall keep or cause to be kept a record of all of the proceedings of the meetings of the shareholders and of the board or directors in books provided for that purpose;
(b) He or she shall cause all notices to be duly given in accordance with the provisions of these Bylaws and as required by statute;
(c) He or she shall be the custodian of the records and of the seal of the corporation, and shall cause such seal (or a facsimile thereof) to be affixed to all certificates representing shares of the corporation prior to the issuance thereof and to all instruments, the execution of which on behalf of the corporation under its seal shall have been duly authorized in accordance with these Bylaws, and when so affixed, he or she may attest the same;
(d) He or she shall assume that the books, reports, statements, certificates, and other documents and records required by statute are properly kept and filed;
(e) He or she shall have charge of the share books of the corporation and cause the share transfer books to be kept in such manner as to show at any time the amount of the shares of the corporation of each class issued and outstanding, the manner in which and the time when such stock was paid for, the names alphabetically arranged and the addresses of the holders of record thereof, the number of shares held by each holder and time when each became such holder or record; and he or she shall exhibit at all reasonable times to any director, upon application, the original or duplicate share register. He or she shall cause the share book referred to in Section 6.04 hereof to be kept and exhibited at the principal office of the corporation, or at such other place as the Board of Directors shall determine, in the manner and for the purposes provided in such Section;
(f) He or she shall be empowered to sign certificates representing shares of the corporation, the issuance of which shall have been authorized by the Board of Directors; and
(g) He or she shall perform in general all duties incident to the office of secretary and such other duties as are given to him or her by these Bylaws or as from time to time may be assigned to him or her by the Board of Directors or the president.
Section 4.11 The Treasurer. The treasurer shall have the following powers and duties:
(a) He or she shall have charge and supervision over and be responsible for the monies, securities, receipts, and disbursements of the corporation;
(b) He or she shall cause the monies and other valuable effects of the corporation to be deposited in the name and to the credit of the corporation in such banks or trust companies or with such banks or other depositories as shall be selected in accordance with Section 5.03 hereof;
(c) He or she shall cause the monies of the corporation to be disbursed by checks or drafts (signed as provided in Section 5.04 hereof) drawn on the authorized depositories of the corporation, and cause to be taken and preserved property vouchers for all monies disbursed;
(d) He or she shall render to the Board of Directors or the president, whenever requested, a statement of the financial condition of the corporation and of all of this transactions as treasurer, and render a full financial report at the annual meeting of the shareholders, if called upon to do so;
(e) He or she shall cause to be kept correct books of account of all the business and transactions of the corporation and exhibit such books to any director on request during business hours;
(f) He or she shall be empowered from time to time to require from all officers or agents of the corporation reports or statements given such information as he or she may desire with respect to any and all financial transactions of the corporation; and
(g) He or she shall perform in general all duties incident to the office of treasurer and such other duties as are given to him or her by these Bylaws or as from time to time may be assigned to him or her by the Board of Directors or the president.
Section 4.12 General Manager. The Board of Directors may employ and appoint a general manager who may, or may not, be one of the officers or directors of the corporation. The general manager, if any shall have the following powers and duties:
(a) He or she shall be the chief executive officer of the corporation and, subject to the directions of the Board of Directors, shall have general charge of the business affairs and property of the corporation and general supervision over its officers, employees, and agents:
(b) He or she shall be charged with the exclusive management of the business of the corporation and of all of its dealings, but at all times subject to the control of the Board of Directors;
(c) Subject to the approval of the Board of Directors or the executive committee, if any, he or she shall employ all employees of the corporation, or delegate such employment to subordinate officers, and shall have authority to discharge any person so employed; and
(d) He or she shall make a report to the president and directors as often as required, setting forth the results of the operations under his or her charge, together with suggestions looking toward improvement and betterment of the condition of the corporation, and shall perform such other duties as the Board of Directors may require.
Section 4.13 Salaries. The salaries and other compensation of the officers of the corporation shall be fixed from time to time by the Board of Directors, except that the Board of Directors may delegate to any person or group of persons the power to fix the salaries or other compensation of any subordinate officers or agents appointed in accordance with the provisions of Section 4.03
hereof. No officer shall be prevented from receiving any such salary or compensation by reason of the fact that he or she is also a director of the corporation.
Section 4.14 Surety Bonds. In case the Board of Directors shall so require, any officer or agent of the corporation shall execute to the corporation a bond in such sums and with such surety or sureties as the Board of Directors may direct, conditioned upon the faithful performance of his or her duties to the corporation, including responsibility for negligence and for the accounting of all property, monies, or securities of the corporation which may come into his or her hands.
ARTICLE V
EXECUTION OF INSTRUMENTS, BORROWING OF MONEY,
AND DEPOSIT OF CORPORATE FUNDS
Section 5.01 Execution of Instruments. Subject to any limitation contained in the Articles of Incorporation or these Bylaws, the president or any vice president or the general manager, if any, may, in the name and on behalf of the corporation, execute and deliver any contract or other instrument authorized in writing by the Board of Directors. The Board of Directors may, subject to any limitation contained in the Articles of Incorporation or in these Bylaws, authorize in writing any officer or agent to execute and delivery any contract or other instrument in the name and on behalf of the corporation; any such authorization may be general or confined to specific instances.
Section 5.02 Loans. No loans or advances shall be contracted on behalf of the corporation, no negotiable paper or other evidence of its obligation under any loan or advance shall be issued in its name, and no property of the corporation shall be mortgaged, pledged, hypothecated, transferred, or conveyed as security for the payment of any loan, advance, indebtedness, or liability of the corporation, unless and except as authorized by the Board of Directors. Any such authorization may be general or confined to specific instances.
Section 5.03 Deposits. All monies of the corporation not otherwise employed shall be deposited from time to time to its credit in such banks and or trust companies or with such bankers or other depositories as the Board of Directors may select, or as from time to time may be selected by any officer or agent authorized to do so by the Board of Directors.
Section 5.04 Checks, Drafts, Etc. All notes, drafts, acceptances, checks, endorsements, and, subject to the provisions of these Bylaws, evidences of indebtedness of the corporation, shall be signed by such officer or officers or such agent or agents of the corporation and in such manner as the Board of Directors from time to time may determine. Endorsements for deposit to the credit of the corporation in any of its duly authorized depositories shall be in such manner as the Board of Directors from time to time may determine.
Section 5.05 Bonds and Debentures. Every bond or debenture issued by the corporation shall be evidenced by an appropriate instrument which shall be signed by the president or a vice president and by the secretary and sealed with the seal of the corporation. The seal may be a facsimile, engraved or printed. Where such bond or debenture is authenticated with the manual signature of an authorized officer of the corporation or other trustee designated by the
indenture of trust or other agreement under which such security is issued, the signature of any of the corporation's officers named thereon may be a facsimile. In case any officer who signed, or whose facsimile signature has been used on any such bond or debenture, should cease to be an officer of the corporation for any reason before the same has been delivered by the corporation, such bond or debenture may nevertheless be adopted by the corporation and issued and delivered as through the person who signed it or whose facsimile signature has been used thereon had not ceased to be such officer.
Section 5.06 Sale, Transfer, Etc. of Securities. Sales, transfers, endorsements, and assignments of stocks, bonds, and other securities owned by or standing in the name of the corporation, and the execution and delivery on behalf of the corporation of any and all instruments in writing incident to any such sale, transfer, endorsement, or assignment, shall be effected by the president, or by any vice president, together with the secretary, or by any officer or agent thereunto authorized by the Board of Directors.
Section 5.07 Proxies. Proxies to vote with respect to shares of other corporations owned by or standing in the name of the corporation shall be executed and delivered on behalf of the corporation by the president or any vice president and the secretary or assistant secretary of the corporation, or by any officer or agent thereunder authorized by the Board of Directors.
ARTICLE VI
CAPITAL SHARES
Section 6.01 Share Certificates. Every holder of shares in the corporation shall be entitled to have a certificate, signed by the president or any vice president and the secretary or assistant secretary, and sealed with the seal (which may be a facsimile, engraved or printed) of the corporation, certifying the number and kind, class or series of shares owned by him or her in the corporation; provided, however, that where such a certificate is countersigned by (a) a transfer agent or an assistant transfer agent, or (b) registered by a registrar, the signature of any such president, vice president, secretary, or assistant secretary may be a facsimile. In case any officer who shall have signed, or whose facsimile signature or signatures shall have been used on any such certificate, shall cease to be such officer of the corporation, for any reason, before the delivery of such certificate by the corporation, such certificate may nevertheless be adopted by the corporation and be issued and delivered as though the person who signed it, or whose facsimile signature or signatures shall have been used thereon, has not ceased to be such officer. Certificates representing shares of the corporation shall be in such form as provided by the statutes of the state of incorporation. There shall be entered on the share books of the corporation at the time of issuance of each share, the number of the certificate issued, the name and address of the person owning the shares represented thereby, the number and kind, class or series of such shares, and the date of issuance thereof. Every certificate exchanged or returned to the corporation shall be marked "Canceled" with the date of cancellation.
Section 6.02 Transfer of Shares. Transfers of shares of the corporation shall be made on the books of the corporation by the holder of record thereof, or by his or her attorney thereunto duly authorized by a power of attorney duly executed in writing and filed with the secretary of the corporation or any of its transfer agents, and on surrender of the certificate or certificates, properly
endorsed or accompanied by proper instruments of transfer, representing such shares. Except as provided by law, the corporation and transfer agents and registrars, if any, shall be entitled to treat the holder of record of any stock as the absolute owner thereof for all purposes, and accordingly, shall not be bound to recognize any legal, equitable, or other claim to or interest in such shares on the part of any other person whether or not it or they shall have express or other notice thereof.
Section 6.03 Regulations. Subject to the provisions of this Article VI and of the Articles of Incorporation, the Board of Directors may make such rules and regulations as they may deem expedient concerning the issuance, transfer, redemption, and registration of certificates for shares of the corporation.
Section 6.04 Maintenance of Stock Ledger at Principal Place of Business. A share book (or books where more than one kind, class, or series of stock is outstanding) shall be kept at the principal place of business of the corporation, or at such other place as the Board of Directors shall determine, containing the names, alphabetically arranged, of original shareholders of the corporation, their addresses, their interest, the amount paid on their shares, and all transfers thereof and the number and class of shares held by each. Such share books shall at all reasonable hours be subject to inspection by persons entitled by law to inspect the same.
Section 6.05 Transfer Agents and Registrars. The Board of Directors may appoint one or more transfer agents and one or more registrars with respect to the certificates representing shares of the corporation, and may require all such certificates to bear the signature of either or both. The Board of Directors may from time to time define the respective duties of such transfer agents and registrars. No certificate for shares shall be valid until countersigned by a transfer agent, if at the date appearing thereon the corporation had a transfer agent for such shares, and until registered by a registrar, if at such date the corporation had a registrar for such shares.
Section 6.06 Closing of Transfer Books and Fixing of Record Date.
(a) The Board of Directors shall have power to close the share books of the corporation for a period of not to exceed 50 days preceding the date of any meeting of shareholders, or the date for payment of any dividend, or the date for the allotment of rights, or capital shares shall go into effect, or a date in connection with obtaining the consent of shareholders for any purpose.
(b) In lieu of closing the share transfer books as aforesaid, the Board of Directors may fix in advance a date, not exceeding 50 days preceding the date of any meeting of shareholders, or the date for the payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital shares shall go into effect, or a date in connection with obtaining any such consent, as a record date for the determination of the shareholders entitled to a notice of, and to vote at, any such meeting and any adjournment thereof, or entitled to receive payment of any such dividend, or to any such allotment of rights, or to exercise the rights in respect of any such change, conversion or exchange of capital stock, or to give such consent.
(c) If the share transfer books shall be closed or a record date set for the purpose of determining shareholders entitled to notice of or to vote at a meeting of shareholders, such books shall be closed for, or such record date shall be, at least 10 days immediately preceding such meeting.
Section 6.07 Lost or Destroyed Certificates. The corporation may issue a new certificate for shares of the corporation in place of any certificate theretofore issued by it, alleged to have been lost or destroyed, and the Board of Directors may, in its discretion, require the owner of the lost or destroyed certificate or his or her legal representatives, to give the corporation a bond in such form and amount as the Board of Directors may direct, and with such surety or sureties as may be satisfactory to the board, to indemnify the corporation and its transfer agents and registrars, if any, against any claims that may be made against it or any such transfer agent or registrar on account of the issuance of such new certificate. A new certificate may be issued without requiring any bond when, in the judgment of the Board of Directors, it is proper to do so.
Section 6.08 No Limitation on Voting Rights; Limitation on Dissenter's Rights. To the extent permissible under the applicable law of any jurisdiction to which the corporation may become subject by reason of the conduct of business, the ownership of assets, the residence of shareholders, the location of offices or facilities, or any other item, the corporation elects not to be governed by the provisions of any statute that (i) limits, restricts, modified, suspends, terminates, or otherwise affects the rights of any shareholder to cast one vote for each share of common stock registered in the name of such shareholder on the books of the corporation, without regard to whether such shares were acquired directly from the corporation or from any other person and without regard to whether such shareholder has the power to exercise or direct the exercise of voting power over any specific fraction of the shares of common stock of the corporation issued and outstanding or (ii) grants to any shareholder the right to have his or her stock redeemed or purchased by the corporation or any other shareholder on the acquisition by any person or group of persons of shares of the corporation. In particular, to the extent permitted under the laws of the state of incorporation, the corporation elects not to be governed by any such provision, including the provisions of the Nevada Control Share Acquisitions Act, Sections 78.378 to 78.3793, inclusive, of the Nevada Revised Statutes, or any statute of similar effect or tenor.
ARTICLE VII
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 7.01 How Constituted. The Board of Directors may designate an executive committee and such other committees as the Board of Directors may deem appropriate, each of which committees shall consist of two or more directors. Members of the executive committee and of any such other committees shall be designated annually at the annual meeting of the Board of Directors; provided, however, that at any time the Board of Directors may abolish or reconstitute the executive committee or any other committee. Each member of the executive committee and of any other committee shall hold office until his or her successor shall have been designated or until his or her resignation or removal in the manner provided in these Bylaws.
Section 7.02 Powers. During the intervals between meetings of the Board of Directors, the executive committee shall have and may exercise all powers of the Board of Directors in the management of the business and affairs of the corporation, except for the power to fill vacancies in the Board of Directors or to amend these Bylaws, and except for such powers as by law may not be delegated by the Board of Directors to an executive committee.
Section 7.03 Proceedings. The executive committee, and such other committees as may be designated hereunder by the Board of Directors, may fix its own presiding and recording officer or officers, and may meet at such place or places, at such time or times and on such notice (or without notice) as it shall determine from time to time. It will keep a record of its proceedings and shall report such proceedings to the Board of Directors at the meeting of the Board of Directors next following.
Section 7.04 Quorum and Manner of Acting. At all meeting of the executive committee, and of such other committees as may be designated hereunder by the Board of Directors, the presence of members constituting a majority of the total authorized membership of the committee shall be necessary and sufficient to constitute a quorum for the transaction of business, and the act of a majority of the members present at any meeting at which a quorum is present shall be the act of such committee. The members of the executive committee, and of such other committees as may be designated hereunder by the Board of Directors, shall act only as a committee and the individual members thereof shall have no powers as such.
Section 7.05 Resignations. Any member of the executive committee, and of such other committees as may be designated hereunder by the Board of Directors, may resign at any time by delivering a written resignation to either the president, the secretary, or assistant secretary, or to the presiding officer of the committee of which he or she is a member, if any shall have been appointed and shall be in office. Unless otherwise specified herein, such resignation shall take effect on delivery.
Section 7.06 Removal. The Board of Directors may at any time remove any member of the executive committee or of any other committee designated by it hereunder either for or without cause.
Section 7.07 Vacancies. If any vacancies shall occur in the executive committee or of any other committee designated by the Board of Directors hereunder, by reason of disqualification, death, resignation, removal, or otherwise, the remaining members shall, until the filling of such vacancy, constitute the then total authorized membership of the committee and, provided that two or more members are remaining, continue to act. Such vacancy may be filled at any meeting of the Board of Directors.
Section 7.08 Compensation. The Board of Directors may allow a fixed sum and expenses of attendance to any member of the executive committee, or of any other committee designated by it hereunder, who is not an active salaried employee of the corporation for attendance at each meeting of said committee.
ARTICLE VIII
INDEMNIFICATION, INSURANCE, AND
OFFICER AND DIRECTOR CONTRACTS
Section 8.01 Indemnification: Third Party Actions. The corporation shall have the power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he or she is or was a director, officer, employee, or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys' fees) judgments, fines, and amounts paid in settlement actually and reasonably incurred by him or her in connection with any such action, suit or proceeding, if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action or proceeding, he or she had reasonable cause to believe that his or her conduct was unlawful.
Section 8.02 Indemnification: Corporate Actions. The corporation shall have the power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he or she is or was a director, officer, employee, or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys' fees) actually and reasonably incurred by him or her in connection with the defense or settlement of such action or suit, if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made in respect of any claim, issue, or matter as to which such a person shall have been adjudged to be liable for negligence or misconduct in the performance of his or her duty to the corporation, unless and only to the extent that the court in which the action or suit was brought shall determine on application that, despite the adjudication of liability but in view of all circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper.
Section 8.03 Determination. To the extent that a director, officer, employee, or agent of the corporation has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in Sections 8.01 and 8.02 hereof, or in defense of any claim, issue, or matter therein, he or she shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him or her in connection therewith. Any other indemnification under Sections 8.01 and 8.02 hereof, shall be made by the corporation upon a determination that indemnification of the officer, director, employee, or agent is proper in the circumstances because he or she has met the applicable standard of conduct set forth in Sections 8.01 and 8.02 hereof. Such determination shall be made either (i) by the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to such action, suit, or proceeding; or (ii) by independent legal counsel on a written opinion; or (iii) by the shareholders by a majority vote of a quorum of shareholders at any meeting duly called for such purpose.
Section 8.04 General Indemnification. The indemnification provided by this
Section shall not be deemed exclusive of any other indemnification granted under
any provision of any statute, in the corporation's Articles of Incorporation,
these Bylaws, agreement, vote of shareholders or disinterested directors, or
otherwise, both as to action in his or her official capacity and as to action in
another capacity while holding such office, and shall continue as to a person
who has ceased to be a director, officer, employee, or agent, and shall inure to
the benefit of the heirs and legal representatives of such a person.
Section 8.05 Advances. Expenses incurred in defending a civil or criminal action, suit, or proceeding as contemplated in this Section may be paid by the corporation in advance of the final disposition of such action, suit, or proceeding upon a majority vote of a quorum of the Board of Directors and upon receipt of an undertaking by or on behalf of the director, officers, employee, or agent to repay such amount or amounts unless if it is ultimately determined that he or she is to indemnified by the corporation as authorized by this Section.
Section 8.06 Scope of Indemnification. The indemnification authorized by this
Section shall apply to all present and future directors, officers, employees,
and agents of the corporation and shall continue as to such persons who ceases
to be directors, officers, employees, or agents of the corporation, and shall
inure to the benefit of the heirs, executors, and administrators of all such
persons and shall be in addition to all other indemnification permitted by law.
8.07. Insurance. The corporation may purchase and maintain insurance on behalf of any person who is or was a director, employee, or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the corporation would have the power to indemnify him or her against any such liability and under the laws of the state of incorporation, as the same may hereafter be amended or modified.
ARTICLE IX
FISCAL YEAR
The fiscal year of the corporation shall be fixed by resolution of the Board of Directors.
ARTICLE X
DIVIDENDS
The Board of Directors may from time to time declare, and the corporation may pay, dividends on its outstanding shares in the manner and on the terms and conditions provided by the Articles of Incorporation and these Bylaws.
ARTICLE XI
AMENDMENTS
All Bylaws of the corporation, whether adopted by the Board of Directors or the shareholders, shall be subject to amendment, alteration, or repeal, and new Bylaws may be made, except that:
(a) No Bylaws adopted or amended by the shareholders shall be altered or repealed by the Board of Directors.
(b) No Bylaws shall be adopted by the Board of Directors which shall require more than a majority of the voting shares for a quorum at a meeting of shareholders, or more than a majority of the votes cast to constitute action by the shareholders, except where higher percentages are required by law; provided, however that (i) if any Bylaw regulating an impending election of directors is adopted or amended or repealed by the Board of Directors, there shall be set forth in the notice of the next meeting of shareholders for the election of directors, the Bylaws so adopted or amended or repealed, together with a concise statement of the changes made; and (ii) no amendment, alteration or repeal of this Article XI shall be made except by the shareholders.
CERTIFICATE OF SECRETARY
The undersigned does hereby certify that she is the secretary of ZEBRA RESOURCES INC., a corporation duly organized and existing under and by virtue of the laws of the State of Nevada; that the above and foregoing Bylaws of said corporation were duly and regularly adopted as such by the Board of Directors of the corporation and that the above and foregoing Bylaws are now in full force and effect.
DATED THIS 26th day of July, 2006.
/s/ Karl Kottmeier ------------------------------------------------ Karl Kottmeier Director, President and Secretary |
Exhibit 5
LAW OFFICE OF MICHAEL M. KESSLER, P.C.
October 19, 2006
Mr. Karl Kotmeier
President/Director
Zebra Resources, Inc
410- 744 West Hastings Street
Vancouver, British Columbia Canada V6C 1A5
RE: Opinion of Counsel for Registration Statement on Form SB-2 Under the Securities Act of 1933 (the "Registration Statement") of Zebra Resources Inc., a Nevada corporation.
Dear Mr. Kotmeier:
The Law Office of Michael M. Kessler, P.C, (the "Firm") has acted as special counsel for Zebra Resources, Inc. a Nevada corporation (the "Company") for the limited purpose of rendering this opinion in connection with the registration (pursuant to the Registration Statement) of 12,000,000 shares (the "Shares") of the common stock, par value $0.001 per share, of the Company
In our capacity as special counsel to the Company, we have examined originals, or copies certified or otherwise identified to my satisfaction, of the following documents:
1. Certificate of Incorporation of the Company, as amended to date;
2. Bylaws of the Company, as amended to date;
3. The records of corporate proceedings relating to the issuance of the
Shares and Warrants and authorizing the offering.
4. Such other instruments and documents, if any, as we believe to be
necessary for the purpose of rendering the following opinion.
In such examinations, we have assumed the authenticity and completeness of all documents, certificates and records submitted to me as originals, the conformity to the original instruments of all documents, certificates and records submitted to me as copies, and the authenticity and completeness of the originals of such instruments. As to certain matters of fact relating to this opinion, we have relied on the accuracy and truthfulness of certificates of officers of the Company and on certificates of public officials, and have made such investigations of law as we have believed necessary and relevant.
Michael M. Kessler, the principal of the firm is a licensed attorney. We do not express any opinion as to the laws of any other jurisdiction other than the
3436 AMERICAN RIVER DRIVE, SUITE 11
TELEPHONE (916) 239-4000
FACSIMILE (916) 239-4008
LAW OFFICE OF MICHAEL M. KESSLER, P.C.
General Corporation Law of the State of Nevada (the "NVCL"), all applicable provisions of the State of Nevada Constitution and all reported judicial decisions interpreting those laws as well as U.S. federal securities law. No opinion is expressed herein with respect to the qualification of the Shares under the securities or blue sky laws of any state or any foreign Jurisdiction. This opinion is limited to the laws, including the rules and regulations thereunder, as in effect on the date hereof. Based on the following I am of the following opinion:
1. Zebra Resources, Inc. (the "Company") is a duly and legally organized and existing Nevada State Corporation, with its registered statutory office located at 711 S. Carson Street, Suite 4, Carson City, Nevada 89701 and its additional mailing receipt office located at 410- 744 West Hastings Street, Vancouver British Columbia Canada V6C 1A5. The Articles of Incorporation and corporate registration fees were submitted to the Nevada Secretary of State's office and filed with the office on July 20, 2006. The Company's existence and form is valid and legal pursuant to the statutes of the State of Nevada. Based on the Firm's personal review of the records made available to it and inquiry with the Secretary of State of Nevada through its web site, the Company's status is shown as "ACTIVE.".
2. The Company is a fully and duly incorporated Nevada corporate entity. The Company has one class of Common Stock at this time. Neither the Articles of Incorporation, Bylaws, and amendments thereto, nor subsequent resolutions change the non-assessable characteristics of the Company's common shares of stock. The Company's original articles of Incorporation authorized 20,000,000 shares with a par value of $0.001 per share. Prior to the issuance of any shares by the Company and incompliance with Nevada Sate Law, the Company amended its Articles of Incorporation and increased the number of Authorized shares to 75,000,000 with par value of $0.001 per share.
3. The Company's outstanding shares are all common shares. There is no liquidation preference right held by the present Shareholder upon voluntary or involuntary liquidation of the Company.
4. To our knowledge, the Company is not a party to any legal proceedings nor are there any judgments against the Company, nor are there any actions or suits filed or threatened against it or its officers and directors, in their capacities as such, other than as set forth in the registration statement. We know of no disputes involving the Company and the Company has no claim, actions or inquires from any federal, state or other government agency, other than as set forth in the registration statement. We know of no claims against the Company or any reputed claims against it at this time, other than as set forth in the registration statement.
5. By directors' resolution, the Company has authorized the issuance of 12,000,000 shares of common stock for this offering. The Company's Articles of Incorporation presently set the authorized capital stock of the Company at 75,000,000 shares designated as Common Stock, with a $0.001 par value.
LAW OFFICE OF MICHAEL M. KESSLER, P.C.
Based upon the foregoing, I am of the opinion that the shares being offered for sale and issuable by the Company pursuant to this Registration Statement will be duly authorized and validly issued, fully paid and non-assessable when issued as contemplated by the registration statement.
The Firm does hereby consent to the use of this opinion as an exhibit to the Registration Statement and to the references to this firm in the Registration Statement. In giving this consent, I do not hereby admit that I was acting within the category of persons whose consent is required under Section 7 of the Securities Act and the rules and regulations of the Securities and Exchange Commission thereunder.
Yours truly,
Law Office of Michael M. Kessler, P.C.
Exhibit 10
MINERAL PROPERTY OPTION AGREEMENT
THIS AGREEMENT dated for reference July 26, 2006.
BETWEEN:
CAZADOR RESOURCES LTD., a company incorporated pursuant to the laws of British Columbia with an office at 5093 Cousins Place, Peachland, British Columbia, VOH IX2;
(the "Optionor")
OF THE FIRST PART
AND:
ZEBRA RESOURCES, INC., a company incorporated pursuant to the laws of the State of Nevada and having its head office at 410 - 744 West Hastings Street, Vancouver, British Columbia, V6C 1A5;
("Zebra")
OF THE SECOND PART
WHEREAS:
A. CAZADOR RESOURCES LTD. is the registered and beneficial owner of a mineral property claim group, which claims are more particularly described in Schedule "A" attached hereto which forms a material part hereof (collectively, the "Claims");
B. The Optionor has agreed to grant to Zebra the sole and exclusive right, privilege and option to explore the Claims together with the sole and exclusive right, privilege and option to purchase the Claims upon the terms and conditions hereinafter set forth;
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the mutual covenants and provisos herein contained, THE PARTIES HERETO AGREE AS FOLLOWS:
1. OPTIONOR REPRESENTATIONS
1.1 The Optionor represents and warrants to Zebra that:
(a) The Optionor is the registered and beneficial owner of the Claims and hold the right to explore and develop the Claims;
(b) The Optionor holds the Claims free and clear of all liens, charges and claims of others, and the Optionor has a free and unimpeded right of access to the Claims and have use of the Claims surface for the herein purposes;
(c) The Claims have been duly and validly located and recorded in a good and miner-like manner pursuant to the laws of British Columbia and are in good standing in British Columbia as of the date of this Agreement;
(d) There are no adverse claims or challenges against or to the Optionor ownership of or title to any of the Claims nor to the knowledge of the Optionor is there any basis therefore, and there are no outstanding agreements or options to acquire or purchase the Claims or any portion thereof;
(e) The Optionor has the full right, authority and capacity to enter into this Agreement without first obtaining the consent of any other person or body corporate and the consummation of the transaction herein contemplated will not conflict with or result in any breach of any covenants or agreements contained in, or constitute a default under, or result in the creation of any encumbrance under the provisions of any indenture, agreement or other instrument whatsoever to which either Optionor is a party or by which they are bound or to which they are subject; and
(f) No proceedings are pending for, and the Optionor is unaware of any basis for, the institution of any proceedings which could lead to the placing of the Optionor in bankruptcy, or in any position similar to bankruptcy.
1.2 The representations and warranties of the Optionor set out in paragraph 1.1 above form a part of this Agreement and are conditions upon which Zebra has relied in entering into this Agreement and shall survive the acquisition of any interest in the Claims by Zebra.
2. ZEBRA'S REPRESENTATIONS
Zebra warrants and represents to the Optionor that it is a body corporate, duly incorporated under the laws of the State of Nevada with full power and
absolute capacity to enter into this Agreement and that the terms of this Agreement have been authorized by all necessary corporate acts and deeds in order to give effect to the terms hereof.
3. GRANT OF OPTION
The Optionor hereby give and grant to Zebra the sole and
exclusive right and option to acquire a l00% undivided right, title and
interest
in and to the Claims (the "Option"), subject to a 2% net smelter returns royalty
reserved in favour of the Optionor, by performing the acts and deeds and paying
the sums provided for in paragraph 4.
4. CONSIDERATION FOR THE GRANT OF OPTION
4.1 In order to keep the Option granted to Zebra in respect of the Claims in good standing and in force and effect, Zebra shall be obligated to:
Cash Payments
(a) Pay to the Optionor a total of $15,000 in the following manner:
(i) $5,000 by July 31, 2006;
(ii) an additional $5,000 by July 31, 2007; and
(iii) an additional $5,000 by July 31, 2008;
Property Payments and Assessment Work
(b) Pay, or cause to be paid, to the Optionor, or on the Optionor behalf as Zebra may determine, all Claims payments and assessment work required to keep the Claims and this Option in good standing during the term of this Agreement.
5. COVENANTS OF ZEBRA
5.1 Zebra shall perform all work on the Claims in a miner-like manner and shall comply with all laws, regulations and permitting requirements of Canada and the Province of British Columbia including compliance with all:
(a) environmental statutes, guidelines and regulations;
(b) work permit conditions for lakes and streams; and
(c) work restrictions relating to forest fire hazards.
6. RIGHT TO ABANDON PROPERTY INTERESTS
Should Zebra, in its sole discretion, determine that any part of the Claims no longer warrants further exploration and development, then Zebra may abandon such interest or interests without affecting its rights or obligations under this Agreement, so long as Zebra provides the Optionor with 30 days notice of its intention to do so. Upon receipt of such notice, the Optionor may request Zebra to retransfer the title to such interest or interests to them, and Zebra hereby agrees to do so, and upon expiry of the 30 days, or upon the earlier transfer thereof, such interests shall cease to be part of the Claims for the purposes of this Agreement.
7. TERMINATION OF OPTION
7.1 Subject to paragraph 7.2, the Option shall terminate if Zebra fails to make the required cash payments or to complete required assessment work in accordance with paragraph 4.1 herein within the time periods specified therein.
7.2 If Zebra shall be in default of any requirement set forth in paragraph 4.1 herein, the Optionor shall give written notice to Zebra specifying the default and Zebra shall not lose any rights granted under this Agreement, unless within 30 days after the giving of notice of default by the Optionor, Zebra has failed to take reasonable steps to cure the default by the appropriate performance.
7.3 If the Option is terminated in accordance with paragraphs 7.1 and 7.2 herein, Zebra shall have no interest in or to the Claims, and all expenditures and payments made by Zebra to or on behalf of the Optionor under this Agreement shall be non-refundable by the Optionor for which Zebra shall have no recourse.
8. ACQUISITION OF INTERESTS IN THE PROPERTY
At such time as Zebra has made all of the required cash payments in accordance with paragraph 4.1 herein, within the time periods specified therein, then the Option shall be deemed to have been exercised by Zebra, and Zebra shall have thereby, without any further act, acquired an undivided 100% interest in and to the Claims, subject to a 2% net smelter returns royalty in favour of the Optionor.
9. RIGHT OF ENTRY
For so long as the Option continues in full force and effect, Zebra, its employees, agents, permitted assigns and independent contractors shall have the right to:
(a) enter upon the Claims;
(b) incur expenditures;
(c) bring upon and erect upon the Claims such mining facilities as Zebra may consider advisable; and
(d) remove material from the Claims for testing purposes up to 2 tonnes for a bulk sample.
10. NET SMELTER RETURNS ROYALTY
10.1 For the purposes of this Agreement, "net smelter returns" shall mean the net amount shown due by the smelter or other place of sale from the sale of mineral products, as indicated by its returns or settlement sheets, after payment of:
(a) all freight charges from the shipping point to the smelter or other place of sale;
(b) all other proper treatment or other charges at such smelter or other place of sale; and
(c) provincial or federal royalties due and payable on production, if any.
10.2 For the purposes of paragraph 10, "commercial production" shall not include milling of ores for the purpose of testing or milling by a pilot plant or milling during an initial tune-up period of a plant.
10.3 On the date Zebra commences commercial production on the Claims, the Optionor shall be entitled to receive and Zebra shall pay to the Optionor 2% of net smelter returns, to a maximum of $1,000,000.
10.4 Zebra shall be under no obligation whatsoever to place the Claims into commercial production and in the event they are placed into commercial production, Zebra shall have the right, at any time, to curtail or suspend such production as it, in its absolute discretion, may determine.
10.5 Net smelter returns and the payments payable to the Optionor hereunder shall be adjusted and paid quarterly, and within 90 days after the end of each fiscal year during which the Claims were in commercial production, the records relating to the calculation of net smelter returns during that fiscal year shall be audited and any adjustments shall be made forthwith, and the audited statements shall be delivered to the Optionor who shall have 60 days after receipt of such statements to question in writing their accuracy and failing such question, the statements shall be deemed correct.
10.6 The Optionor or their representatives duly appointed in writing shall have the right at all reasonable times, upon written request, to inspect those books and financial records of Zebra which are relevant to the determination of net smelter returns, and, at the expense of the Optionor, to make copies thereof.
11. OPERATOR
After the execution of this Agreement, Zebra, or at Zebra's option, its respective associate or nominee or such other unrelated entity as it may determine, will act as the operator of the Claims under this Agreement. Zebra, if operator, may resign as the operator at any time by giving 30 calendar days prior written notice to the Optionor, and within such 30 day period, Zebra may appoint another party who covenants to act as the operator of the Claims upon such terms as Zebra sees fit.
12. POWER AND AUTHORITY OF THE OPERATOR
After the execution of this Agreement, the Operator shall have full right, power and authority to do everything necessary or desirable in connection with the exploration and development of the Claims and to determine the manner of operation of the Claims as a mine.
13. REGISTRATION OF PROPERTY INTERESTS
Upon the request of Zebra, the Optionor shall assist Zebra to record this Agreement with the appropriate mining recorder and, when required, the Optionor shall further provide Zebra with such recordable documents as Zebra and its counsel shall require to record its due interest in respect of the Claims.
14. FURTHER ASSURANCES
The parties hereto agree to do or cause to be done all acts or things necessary to implement and carry into effect the provisions and intent of this Agreement.
15. FORCE MAJEURE
If Zebra is prevented from or delayed in complying with any provisions of this Agreement by reasons of strikes, labour disputes, lockouts, labour shortages, power shortages, fires, wars, acts of God, governmental regulations restricting normal operations or any other reason or reasons beyond the control of Zebra, the time limited for the performance of the various provisions of this Agreement as set out above shall be extended by a period of time equal in length to the period of such prevention and delay, and Zebra, insofar as is possible, shall promptly give written notice to the Optionor of the particulars of the reasons for any prevention or delay under this section, and shall take all reasonable steps to remove the cause of such prevention or delay and shall give written notice to the Optionor as soon as such cause ceases to exist.
16. CONFIDENTIAL INFORMATION
No information furnished by Zebra to the Optionor hereunder in respect of the activities carried out on the Claims by Zebra, or related to the sale of mineral products derived from the Claims, shall be published by the Optionor without the prior written consent of Zebra, but such consent in respect of the reporting of factual data shall not be unreasonably withheld.
17. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement to date between the parties hereto and supersedes every previous agreement, communication, expectation, negotiation, representation or understanding, whether oral or written, express or implied, statutory or otherwise, between the parties hereto with respect to the subject matter of this Agreement.
18. NOTICE
18.1 Any notice required to be given under this Agreement shall be deemed to be well and sufficiently given if delivered, or if mailed by registered mail in Canada, in the case of the Optionor addressed to them as follows:
Cazador Resources Ltd.
5093 Cousins Place
Peachland, British Columbia
V0H 1X2
and in the case of Zebra addressed as follows:
Zebra Resources, Inc..
Suite 410- 744 West Hastings Street
Vancouver, British Columbia
V6C 1A5
and any notice given as aforesaid shall be deemed to have been given, if delivered, when delivered, or if mailed, on the third business day after the date of mailing thereof.
18.2 Either party hereto may from time to time by notice in writing change its address for the purpose of this section.
19. OPTION ONLY
Until the Option is exercised, this is an option only and except as specifically provided otherwise, nothing herein contained shall be construed as obligating Zebra to do any acts or make any payments hereunder and any acts or payments made hereunder shall not be construed as obligating Zebra to do any further acts or make any further payments.
20. RELATIONSHIP OF PARTIES
Nothing contained in this Agreement shall, except to the extent specifically authorized hereunder, be deemed to constitute either party hereto a partner, agent or legal representative of the other party.
21. TIME OF ESSENCE
Time shall be of the essence of this Agreement.
22. TITLES
The titles to the respective sections hereof shall not be deemed a part of this Agreement but shall be regarded as having been used for convenience only.
23. CURRENCY
All funds referred to under the terms of this Agreement shall be funds designated in the lawful currency of the United States of America.
24. SEVERABILITY
In the event that any of the paragraphs contained in this Agreement, or any portion of thereof, is unenforceable or is declared invalid for any reason whatsoever, such unenforceability or invalidity shall not affect the enforceability or validity of the remaining terms or portions thereof contained in this Agreement and such unenforceable or invalid paragraph, or portion thereof, shall be severable from the remainder of the Agreement.
25. APPLICABLE LAW
The situs of the Agreement is Vancouver, British Columbia, and for all purposes this Agreement will be governed exclusively by and construed and enforced in accordance with the laws prevailing in the Province of British Columbia.
26. ENUREMENT
This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and assigns.
IN WITNESS WHEREOF this Agreement has been executed as of the day and year first above written.
CAZADOR RESOURCES LTD. ZEBRA RESOURCES, INC. --------------------------------- --------------------------------- Adam Travis Karl Kottmeier Authorized Signatory Authorized Signatory |
SCHEDULE "A"
TO THAT CERTAIN AGREEMENT MADE AS OF JULY 26, 2006 Between CAZADOR
RESOURCES LTD. AND ZEBRA RESOURCES, INC.
The mineral claim that constitute the Astro 2006 claims are located in the Province on British Columbia on Map Sheet 82E032.
Specifics of the claims are as follows:
Claim Name Hectares Good Till Date Tenure Number ---------- -------- -------------- ------------- Astro 2006 168.293 July 19, 2007 537414 |
[CLAIM MAP]
Exhibit 23.2
[LETTRHEAD OF DE JOYA GRIFFITH & COMPANY, LLC]
INDEPENDENT AUDITORS' CONSENT
We consent to the use of Zebra Resources, Inc. on Form SB-2 of our Auditor's Report dated October 12, 2006, on the balance sheet of Zebra Resources, Inc. as of August 31, 2006 and the related statement of income and accumulated deficit from July 20, 2006 to August 31, 2006, changes in stockholders' equity, and cash flows for the period ended August 31, 2006.
/s/ De Joya Griffith & Company, LLC --------------------------------------- October 20, 2006 Henderson, Nevada |
Exhibit 99.1
CONFIDENTIAL
PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT
(Subscribers Resident Outside of the United States)
TO: Zebra Resources Inc. (the "Company")
410 - 744 West Hastings Street
Vancouver, British Columbia
Canada V6C 1A5
PURCHASE OF SHARES
1. SUBSCRIPTION
1.1 The undersigned (the "Subscriber") hereby irrevocably subscribes for and agrees to purchase from the Company, on the basis of the representations and warranties and subject to the terms and conditions set forth herein, ________________ common shares in the capital of the Company (the "Shares") at the price of US$0.05 per Share (such subscription and agreement to purchase being the "Subscription") for the total purchase price of $______________ (the "Subscription Proceeds").
1.2 Subject to the terms hereof, the Subscription will be effective upon its acceptance by the Company. The Subscriber acknowledges that the offering of the Shares contemplated hereby is part of an offering of Shares having an aggregate subscription level of US$ (the "Offering"). The Offering is not subject to any minimum aggregate subscription level.
2. PAYMENT
2.1 The Subscription Proceeds must accompany this Subscription and shall be paid by certified cheque or bank draft drawn on a major United States or Canadian chartered bank, and made payable and delivered to the Company. Alternatively, the Subscription Proceeds may be wired to the Company or its lawyers pursuant to wiring instructions that will be provided to the Subscriber upon request. If the funds are wired to the Company's lawyers, those lawyers are authorized to immediately deliver the funds to the Company.
2.2 The Subscriber acknowledges and agrees that this Agreement, the Subscription Proceeds and any other documents delivered in connection herewith will be held on behalf of the Company. In the event that this Agreement is not accepted by the Company for whatever reason, which the Company expressly reserves the right to do, within 30 days of the delivery of an executed Agreement by the Subscriber, this Agreement, the Subscription Proceeds (without interest thereon) and any other documents delivered in connection herewith will be returned to the Subscriber at the address of the Subscriber as set forth in this Agreement.
2.3 Where the Subscription Proceeds are paid to the Company, the Company is entitled to treat such Subscription Proceeds as an interest free loan to the Company until such time as the Subscription is accepted and the certificates representing the Shares have been issued to the Subscriber.
3. DOCUMENTS REQUIRED FROM SUBSCRIBER
3.1 The Subscriber must complete, sign and return to the Company an executed copy of this Agreement.
3.2 The Subscriber shall complete, sign and return to the Company as soon as possible, on request by the Company, any documents, questionnaires, notices and undertakings as may be required by regulatory authorities, and applicable law.
4. CLOSING
4.1 Closing of the Offering (the "Closing") shall occur on or before , 2006, or on such other date as may be determined by the Company (the "Closing Date").
4.2 The Company may, at its discretion, elect to close the Offering in one or more closings, in which event the Company may agree with one or more subscribers (including the Subscriber hereunder) to complete delivery of the Shares to such subscriber(s) against payment therefor at any time on or prior to the Closing Date.
5. ACKNOWLEDGEMENTS OF SUBSCRIBER
5.1 The Subscriber acknowledges and agrees that:
(a) the Shares may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons, as that term is defined in Regulation S under the 1933 Act ("Regulation S"), except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act and in each case in accordance with applicable state and provincial securities laws;
(b) the decision to execute this Agreement and acquire the Shares is based entirely upon a review of information (the receipt of which is hereby acknowledged) which has been filed by the Company with the Securities and Exchange Commission (the "SEC");
(c) neither the SEC nor any other securities commission or similar regulatory authority has reviewed or passed on the merits of the Shares;
(d) there is no government or other insurance covering any of the Shares;
(e) there are risks associated with an investment in the Shares;
(f) the Company has advised the Subscriber that the Company is relying on an exemption from the requirements to provide the Subscriber with a prospectus and to sell the Shares through a person registered to sell securities under the SECURITIES ACT (British Columbia) (the "B.C. Act") and, as a consequence of acquiring the Shares pursuant to this exemption, certain protections, rights and remedies provided by the B.C. Act, including statutory rights of rescission or damages, will not be available to the Subscriber;
(g) the Subscriber has not acquired the Shares as a result of, and will not itself engage in, any "directed selling efforts" (as defined in Regulation S under the 1933 Act) in the United States in respect of the Shares which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of any of the Shares; provided, however, that the Subscriber may sell or otherwise dispose of the Shares pursuant to registration thereof under the 1933 Act and any applicable state and provincial securities laws or under an exemption from such registration requirements;
(h) the Subscriber and the Subscriber's advisor(s) have had a reasonable opportunity to ask questions of and receive answers from the Company in connection with the distribution of the Shares hereunder, and to obtain additional information, to the extent possessed or obtainable without unreasonable effort or expense, necessary to verify the accuracy of the information about the Company;
(i) the books and records of the Company were available upon reasonable notice for inspection, subject to certain confidentiality restrictions, by the Subscriber during reasonable business hours at its principal place of business, and all documents, records and books
in connection with the distribution of the Shares hereunder have been made available for inspection by the Subscriber, the Subscriber's lawyer and/or advisor(s);
(j) the Subscriber will indemnify and hold harmless the Company and, where applicable, its directors, officers, employees, agents, advisors and shareholders, from and against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all fees, costs and expenses whatsoever reasonably incurred in investigating, preparing or defending against any claim, lawsuit, administrative proceeding or investigation whether commenced or threatened) arising out of or based upon any representation or warranty of the Subscriber contained herein or in any document furnished by the Subscriber to the Company in connection herewith being untrue in any material respect or any breach or failure by the Subscriber to comply with any covenant or agreement made by the Subscriber to the Company in connection therewith;
(k) the Shares are not listed on any stock exchange or automated dealer quotation system and no representation has been made to the Subscriber that any of the Shares will become listed on any stock exchange or automated dealer quotation system;
(l) there are additional restrictions on the Subscriber's ability to resell the Shares under the B.C. Act and Multilateral Instrument 45-102 adopted by the British Columbia Securities Commission;
(m) the Company will refuse to register any transfer of the Shares not made in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act or pursuant to an available exemption from the registration requirements of the 1933 Act and in accordance with applicable state and provincial securities laws;
(n) the Subscriber has been advised to consult the Subscriber's own legal, tax and other advisors with respect to the merits and risks of an investment in the Shares and with respect to applicable resale restrictions, and it is solely responsible (and the Company is not in any way responsible) for compliance with:
(i) any applicable laws of the jurisdiction in which the Subscriber is resident in connection with the distribution of the Shares hereunder, and
(ii) applicable resale restrictions; and
(o) this Agreement is not enforceable by the Subscriber unless it has been accepted by the Company, and the Subscriber acknowledges and agrees that the Company reserves the right to reject any subscription for any reason.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SUBSCRIBER
6.1 The Subscriber hereby represents and warrants to and covenants with the Company (which representations, warranties and covenants shall survive the Closing) that:
(a) the Subscriber has the legal capacity and competence to enter into and execute this Agreement and to take all actions required pursuant hereto and, if the Subscriber is a corporation, it is duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation and all necessary approvals by its directors, shareholders and others have been obtained to authorize execution and performance of this Agreement on behalf of the Subscriber;
(b) the entering into of this Agreement and the transactions contemplated hereby do not result in the violation of any of the terms and provisions of any law applicable to the Subscriber or of any agreement, written or oral, to which the Subscriber may be a party or by which the Subscriber is or may be bound;
(c) the Subscriber has duly executed and delivered this Agreement and it constitutes a valid and binding agreement of the Subscriber enforceable against the Subscriber in accordance with its terms;
(d) the Subscriber is (CHECK ONE OR MORE OF THE FOLLOWING BOXES):
(A) a director, executive officer or control person of the Company or an affiliate of the Company [ ]
(B) a spouse, parent, grandparent, brother, sister or child of a director, executive officer or control person of the Company or an affiliate of the Company [ ]
(C) a parent, grandparent, brother, sister or child of the spouse of a director, executive officer or control person of the Company or an affiliate of the Company [ ]
(D) a close personal friend of a director, executive officer or control person of the Company or an affiliate of the Company [ ]
(E) a close business associate of a director, executive officer or control person of the Company or an affiliate of the Company [ ]
(F) a founder of the Company or a spouse, parent, grandparent, brother, sister, child, close personal friend or close business associate of a founder of the Company [ ]
(G) a parent, grandparent, brother, sister or child of the spouse of a founder of the Company [ ]
(H) a company, partnership or other entity which a majority of the voting securities are beneficially owned by, or a majority of the directors are, persons or companies as described in paragraphs (A) to (G) above [ ]
(I) purchasing as principal Shares with an aggregate value of more than CDN$150,000 [ ]
(J) an accredited investor [ ]
(e) if the Subscriber has checked one or more of boxes B, C, D, E, F, G or H in paragraph 6.1(d) above, the director(s), executive officer(s), control person(s) or founder(s) of the Company with whom the Subscriber has the relationship is:
(INSTRUCTIONS TO SUBSCRIBER: FILL IN THE NAME OF EACH DIRECTOR, EXECUTIVE OFFICER, FOUNDER AND CONTROL PERSON WHICH YOU HAVE THE ABOVE-MENTIONED RELATIONSHIP WITH. IF YOU HAVE CHECKED BOX H, ALSO INDICATE WHICH OF A TO G DESCRIBES THE SECURITYHOLDERS OR DIRECTORS WHICH QUALIFY YOU AS BOX H AND PROVIDE THE NAMES OF THOSE INDIVIDUALS. PLEASE ATTACH A SEPARATE PAGE IF NECESSARY).
(f) If the Subscriber has ticked box J in paragraph 6.1(d) above, the Subscriber acknowledges and agrees that the Company shall not consider the Subscriber's Subscription for acceptance unless the undersigned provides to the Company, along with an executed copy of this Agreement:
(i) a fully completed and executed Accredited Investor Questionnaire in the form attached as Exhibit 1 hereto; and
(ii) such other supporting documentation that the Company or its legal counsel may request to establish the Subscriber's qualification as an Accredited Investor;
(g) the Subscriber is resident in the jurisdiction set out under the heading "Name and Address of Subscriber" on the signature page of this Agreement;
(h) the sale of the Shares to the Subscriber as contemplated in this Agreement complies with or is exempt from the applicable securities legislation of the jurisdiction of residence of the Subscriber;
(i) the Subscriber is acquiring the Shares for investment only and not with a view to resale or distribution;
(j) the Subscriber is acquiring the Shares as principal for the Subscriber's own account, for investment purposes only, and not with a view to, or for, resale, distribution or fractionalisation thereof, in whole or in part, and no other person has a direct or indirect beneficial interest in such Shares;
(k) the Subscriber is not an underwriter of, or dealer in, the common shares of the Company, nor is the Subscriber participating, pursuant to a contractual agreement or otherwise, in the distribution of the Shares;
(l) the Subscriber (i) is able to fend for him/her/itself in the Subscription; (ii) has such knowledge and experience in business matters as to be capable of evaluating the merits and risks of its prospective investment in the Shares; and (iii) has the ability to bear the economic risks of its prospective investment and can afford the complete loss of such investment;
(m) the Subscriber acknowledges that the Subscriber has not acquired the Shares as a result of, and will not itself engage in, any "directed selling efforts" (as defined in Regulation S under the 1933 Act) in the United States in respect of the Shares which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of the Shares; provided, however, that the Subscriber may sell or otherwise dispose of the Shares pursuant to registration of the Shares pursuant to the 1933 Act and any applicable state and provincial securities laws or under an exemption from such registration requirements and as otherwise provided herein;
(n) the Subscriber understands and agrees that the Shares may not be offered or sold in the United States or, directly or indirectly, to U.S. Persons except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act;
(o) the Subscriber understands and agrees that the Company will refuse to register any transfer of the Shares not made in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the 1933 Act or pursuant to an available exemption from the registration requirements of the 1933 Act;
(p) the Subscriber is not aware of any advertisement of any of the Shares and is not acquiring the Shares as a result of any form of general solicitation or general advertising including advertisements, articles, notices or other communications published in any newspaper,
magazine or similar media or broadcast over radio or television, or any seminar or meeting whose attendees have been invited by general solicitation or general advertising; and
(q) no person has made to the Subscriber any written or oral representations:
(i) that any person will resell or repurchase any of the Shares;
(ii) that any person will refund the purchase price of any of the Shares;
(iii) as to the future price or value of any of the Shares; or
(iv) that any of the Shares will be listed and posted for trading on any stock exchange or automated dealer quotation system or that application has been made to list and post any of the Shares of the Company on any stock exchange or automated dealer quotation system.
7. ACKNOWLEDGEMENT AND WAIVER
7.1 The Subscriber has acknowledged that the decision to purchase the Shares was solely made on the basis of available information provided to the Subscriber. The Subscriber hereby waives, to the fullest extent permitted by law, any rights of withdrawal, rescission or compensation for damages to which the Subscriber might be entitled in connection with the distribution of the Shares.
8. REPRESENTATIONS AND WARRANTIES WILL BE RELIED UPON BY THE COMPANY
8.1 The Subscriber acknowledges that the representations and warranties contained herein and, if applicable, in an Accredited Investor Questionnaire, are made by the undersigned with the intention that they may be relied upon by the Company and its legal counsel in determining the undersigned's eligibility to acquire the Shares under relevant Legislation. The undersigned further agrees that by accepting delivery of the Shares, the undersigned will be representing and warranting that the foregoing representations and warranties are true and correct as at the time of delivery of such Shares with the same force and effect as if they had been made by the undersigned at such time, and that they shall survive the completion of the transactions contemplated under this Subscription and remain in full force and effect thereafter for the benefit of the Company for a period of one year.
8.2 The Subscriber hereby acknowledges and agrees to the Company making a notation on its records or giving instructions to the registrar and transfer agent of the Company in order to implement the restrictions on transfer set forth and described in this Agreement.
9. GOVERNING LAW
9.1 This Agreement is governed by the laws of the Province of British Columbia. The Subscriber, in its personal or corporate capacity and, if applicable, on behalf of each beneficial purchaser for whom it is acting, irrevocably attorns to the jurisdiction of the courts of the Province of British Columbia.
10. SURVIVAL
10.1 This Agreement, including without limitation the representations, warranties and covenants contained herein, shall survive and continue in full force and effect and be binding upon the parties hereto notwithstanding the completion of the purchase of the Shares by the Subscriber pursuant hereto.
11. ASSIGNMENT
11.1 This Agreement is not transferable or assignable.
12. SEVERABILITY
12.1 The invalidity or unenforceability of any particular provision of this Agreement shall not affect or limit the validity or enforceability of the remaining provisions of this Agreement.
13. ENTIRE AGREEMENT
13.1 Except as expressly provided in this Agreement and in the agreements, instruments and other documents contemplated or provided for herein, this Agreement contains the entire agreement between the parties with respect to the sale of the Shares and there are no other terms, conditions, representations or warranties, whether expressed, implied, oral or written, by statute or common law, by the Company or by anyone else.
14. NOTICES
14.1 All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Subscriber shall be directed to the address on the signature page of this Agreement and notices to the Company shall be directed to it at Zebra Resources Inc., 410 - 744 West Hastings Street, Vancouver, British Columbia, Canada V6C 1A5, Attention: Karl Kottmeier, President.
15. COUNTERPARTS AND ELECTRONIC MEANS
15.1 This Agreement may be executed in any number of counterparts, each of which, when so executed and delivered, shall constitute an original and all of which together shall constitute one instrument. Delivery of an executed copy of this Agreement by electronic facsimile transmission or other means of electronic communication capable of producing a printed copy will be deemed to be execution and delivery of this Agreement as of the date hereinafter set forth.
IN WITNESS WHEREOF the Subscriber has duly executed this Agreement as of the date of acceptance by the Company.
A C C E P T A N C E
The above-mentioned Agreement in respect of the Shares is hereby accepted by Zebra Resources Inc.
DATED at , the day of , 2006.
ZEBRA RESOURCES INC.
EXHIBIT 1
NI 45-106 ACCREDITED INVESTOR QUESTIONNAIRE
All capitalized terms herein, unless otherwise defined, have the meanings ascribed thereto in the Subscription.
The purpose of this Questionnaire is to assure the Company that each Subscriber will meet certain requirements of National Instrument 45-106 ("NI 45-106"). The Company will rely on the information contained in this Questionnaire for the purposes of such determination.
The Subscriber covenants, represents and warrants to the Company that:
1. the Subscriber has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the transactions detailed in the Subscription and the Subscriber is able to bear the economic risk of loss arising from such transactions;
2. the Subscriber satisfies one or more of the categories of "accredited investor" (as that term is defined in NI 45-106) indicated below (please check the appropriate box):
[ ] (a) a Canadian financial institution as defined in National Instrument 14-101, or an authorized foreign bank listed in Schedule III of the BANK ACT (Canada);
[ ] (b) the Business Development Bank of Canada incorporated under
the BUSINESS DEVELOPMENT BANK ACT (Canada);
[ ] (c) a subsidiary of any person referred to in any of the foregoing categories, if the person owns all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary;
[ ] (d) an individual registered or formerly registered under securities legislation in a jurisdiction of Canada, as a representative of a person or company registered under securities legislation in a jurisdiction of Canada, as an adviser or dealer, other than a limited market dealer registered under the SECURITIES ACT (Ontario) or the SECURITIES ACT (Newfoundland);
[ ] (e) an individual registered or formerly registered under the securities legislation of a jurisdiction of Canada as a representative of a person referred to in paragraph (d);
[ ] (f) the government of Canada or a province, or any crown corporation or agency of the government of Canada or a province;
[ ] (g) a municipality, public board or commission in Canada and a metropolitan community, school board, the Comite de gestion de la taxe scholaire de l'ile de Montreal or an intermunicipal management board in Quebec;
[ ] (h) a national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency thereof;
[ ] (i) a pension fund that is regulated by either the Office of the Superintendent of Financial Institutions (Canada) or a pension commission or similar regulatory authority of a jurisdiction of Canada;
[ ] (j) an individual who either alone or with a spouse beneficially owns, directly or indirectly, financial assets (as defined in NI 45-106) having an aggregate realizable value that, before taxes but net of any related liabilities, exceeds CDN$1,000,000;
[ ] (k) an individual whose net income before taxes exceeded CDN$200,000 in each of the two more recent calendar years or whose net income before taxes combined with that of a spouse exceeded $300,000 in each of those years and who, in either case, reasonably expects to exceed that net income level in the current calendar year;
[ ] (l) an individual who, either alone or with a spouse, has net assets of at least CDN $5,000,000;
[ ] (m) a person, other than a person or investment fund, that had net assets of at least CDN$5,000,000 as reflected on its most recently prepared financial statements;
[ ] (n) an investment fund that distributes it securities only to persons that are accredited investors at the time of distribution, a person that acquires or acquired a minimum of CDN$150,000 of value in securities, or a person that acquires or acquired securities under Sections 2.18 or 2.19 of NI 45-106;
[ ] (o) an investment fund that distributes or has distributed securities under a prospectus in a jurisdiction of Canada for which the regulator or, in Quebec, the securities regulatory authority, has issued a receipt;
[ ] (p) a trust company or trust corporation registered or authorized to carry on business under the TRUST AND LOAN COMPANIES ACT (Canada) or under comparable legislation in a jurisdiction of Canada or a foreign jurisdiction, acting on behalf of a fully managed account managed by the trust company or trust corporation, as the case may be;
[ ] (q) a person acting on behalf of a fully managed account managed by that person, if that person (i) is registered or authorized to carry on business as an adviser or the equivalent under the securities legislation of a jurisdiction of Canada or a foreign jurisdiction, and (ii) in Ontario, is purchasing a security that is not a security of an investment fund;
[ ] (r) a registered charity under the INCOME TAX ACT (Canada) that, in regard to the trade, has obtained advice from an eligibility advisor or an advisor registered under the securities legislation of the jurisdiction of the registered charity to give advice on the securities being traded;
[ ] (s) an entity organized in a foreign jurisdiction that is
analogous to any of the entities referred to in paragraphs (a) to
(d) or paragraph (i) in form and function;
[ ] (t) a person in respect of which all of the owners of interests, direct, indirect or beneficial, except the voting securities required by law are persons or companies that are accredited investors.
[ ] (u) an investment funds that is advised by a person registered as an advisor or a person that is exempt from registration as an advisor; or
[ ] (v) a person that is recognized or designated by the securities regulatory authority or, except in Ontario and Quebec, the regulator as (i) an accredited investor, or (ii) an exempt purchaser in Alberta or British Columbia after this instrument comes into force;
The Subscriber acknowledges and agrees that the Subscriber may be required by the Company to provide such additional documentation as may be reasonably required by the Company and its legal counsel in determining the Subscriber's eligibility to acquire the Shares under relevant Legislation.
IN WITNESS WHEREOF, the undersigned has executed this Questionnaire as of the day of ____________, 2006.
If an Individual: If a Corporation, Partnership or Other Entity:
------------------------------- -------------------------------
Signature Print or Type Name of Entity
------------------------------- -------------------------------
Print or Type Name Signature of Authorized Signatory
-------------------------------
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Type of Entity
Exhibit 99.2
ZEBRA RESOURCES INC.
GEOLOGICAL REPORT ON THE ASTRO 2006 MINERAL PROPERTY
OLLALA-PENTICTON AREA, OSOYOOS MINING DIVISION
BRITISH COLUMBIA, MAPSHEET 82E032
ADAM TRAVIS, BSC. MAJOR GEOLOGY
AUGUST 3, 2006
TABLE OF CONTENTS
I. Summary and Recommendations ..................................... l II. Terms of Reference .............................................. l III. Location and Access ............................................. 2 IV. Topography and Physiography ..................................... 2 V. Claim Details ................................................... 2 VI. History and Previous Work ....................................... 2 VII. Regional and Property Geology ................................... 5 VIII. Local and Property Mineralization ............................... 6 IX. Previous Geophysics ............................................. 7 X. Previous Trenching .............................................. 7 XI. Previous Drilling ............................................... 7 XII. Recommendations and Conclusions ................................. 8 XIII. References ...................................................... 9 Figure 1: Location Map ................................................ 3 Figure 2: Claim Map ................................................... 4 Figure 3: Regional Geology ............................................ 6 Appendix I Statement of Qualifications |
I. SUMMARY AND RECOMMENDATIONS
The Astro 2006 mineral property consists of a total of 8 M.T.O cells (totaling 168.29 hectares) in the Olalla area of southern B.C located approximately 10 kilometres west of the Vault Property at Okanagan Falls. The claim area is easily accessed from Hwy 3A southwest of Penticton to the Sheep Creek Forest Service road. Previous claims were held in the area between 1977-1993 by Pacific Petroleum Ltd. (Petro Canada) in the search for uranium. Work by Placer Development Ltd. from 1984-1986 led to the re-discovery of old workings in the Carboniferous-Triassic cherts to the west of the current claims. Subsequent work by QPX Minerals on both the Placer and Petro Canada claims ensued between 1986-1989. This work led to the discovery of argillic and silicified zones in Marron volcanics which returned anomalous gold, silver and molybdenum values on the Astro 34 claim of Petro Canada's.
The QPX work on the Astro 34 claim included a small (400 m x 400 m) magnetometer/VLF-EM grid, 5 trenches totaling 150 metres and 5 RC holes totaling 250 metres. The RC holes returned values up to 705 ppb Au over the 10-foot runs. This drilling also indicates a widening of silicification to 14 metres true width at a depth of 47 metres, which may be the result of the merging of two zones at depth. Continued evaluation of at least three more geophysical targets by trenching and drilling, grid expansion, test soils and geological mapping were recommended but not followed up.
The claims were then returned to Petro Canada who completed no further work and allowed them to lapse in 1993. No recorded work has taken place since the 1989-drilling program.
These previous anomalous results indicate that a gold -enriched system occurs along north-south structures that probably represent graben faults of the Trout Lake graben. Chalcedonic veinlets with anomalous gold may help to vector into areas with higher grades, particularly along un-tested structures that have been outlined by previous geophysical surveys. Similar values have been used at both the Emmanual Creek Mine in the Republic Camp ("0.02 opt Au Project") and the adjacent Vault Property ("0.1 ppm grade contour") to help locate higher-grade zones.
Accordingly, a two-phase program of geological, geochemical, geophysical surveys followed by trenching is recommended for the Astro 2006 property.
The estimated cost of the proposed fieldwork is $US 15,000 for the initial phase and an additional $US 75,000 for a contingent second phase.
II. TERMS OF REFERENCE
This report is intended as a description of the geology of the Astro 2006 claim area, a review of available pertinent technical data and a set of recommendations for a preliminary program of geological, geochemical and geophysical exploration on the property. It has been prepared at the request of Mr. Karl Kottmeier, of Zebra Resources Inc. and is based on geological descriptions contained in a number of published and unpublished reports and maps and on fieldwork carried out by the author in the area of the proposed project.
III. LOCATION AND ACCESS
The Astro (Minfile PDL:Astro: Ford:Akira: 82ESW 190) property is located approximately 15 kilometres west of Okanagan Falls or 20 kilometres southwest of Penticton in southern British Columbia. The claims are most easily accessed via Hwy 3A west from Kaleden for about 12 kilometres to the Sheep Creek Forest Service road turnoff located between Trout and Yellow Lakes. The Sheep Creek road is taken northwesterly for a distance of approximately 7 kilometres to the claim area.
IV. TOPOGRAPHY AND PHYSIOGRAPHY
The Astro property is situated in the southern Okanagan area of British Columbia. The region has a relatively dry climate, and snow cover in winter is generally moderate. The climate in the area is semi arid with moderately warm summers and cold dry winters. Typical temperature ranges are from mid to upper 30's C in summer and -10 to -20 C in winter. Within the Astro property elevations range from 1150 metres in the main valley bottom in the southern portion of the claims to over 1400 metres in the northern portion of the claims. Slopes are generally moderate however small bluffs and steeper slopes do occur near the central portions of the claims. Southerly draining creeks and gulleys on the claims are generally intermittent and most likely reflect underlying structures. For the most part vegetation consists of jackpine forest, some of which has been infected with pine beetles.
V. CLAIMS
The Astro 2006 property consists of 8 Mineral Title Online (M.T.O) cells listed under tenure # 537414 and were acquired on July 19, 2006. They were a restake of claims previously acquired by the author by staking on April 28, 2003 and are owned 100% by Cazador Resources a private company controlled by the author. The claims were staked to cover the Astro 34 area of the PDL Project of QPX Minerals and at present cover a total of 168.293 hectares.
VI. HISTORY AND PREVIOUS WORK
The earliest record of work in the area dates back to the late 1800's with the discovery of the Giant Mascot and Hedley deposits to the west. Gold was also discovered on the nearby Dividend and Apex Mountains in the early 1900's. Several deposits from which a significant amount of gold, silver and molybdenum was shipped were discovered at Olalla in the 1920's.
In the late 1960's there was renewed interest in the area for copper exploration.
On the PDL claim to the west of the current Astro claims there is evidence of previous work in the Pre-Tertiary rocks but no published record of this work exists. A short (< 10 m) adit at the base of the cliffs cross cuts a small massive sulphide lens. According to a local prospector (L. Reichert) this was dug in the 1930's. An old cased diamond drillhole and several bulldozer trenches were believed to have been completed in 1971, although no work was filed.
The Astro claims were staked by Pacific Petroleum Ltd. (Petro Canada) in 1977 and 1979 during uranium exploration.
[Figure 1: Location Map]
[Figure 2: Astro 2006 claim, Map Scale ~ 1:100,000]
In 1984 Placer Development Ltd. took a number of soil samples (Assessment Report 13199) in the Keremeos Creek valley to the west, which was anomalous in Au, As, Cu and Mo, which indicate a source on the east wall of the valley upstream of an alluvial fan.
In 1985 Placer completed EM/Mag geophysics and line cutting on their PDL claim (Assessment Report 14062). The claim was found to underlain by Triassic Shoemaker Formation cherts, some tuffs and greenstone intruded by Cretaceous granite and overlain by the Paleocene/Eocene volcanics. A well-defined fracture/fault set trending about N20E is evident from the airphoto's.
In 1986 QPX Minerals worked the PDL and Ford 1 claims to the west of the current Astro claims (Assessment Report 16674). A total of 496 soils and 164 rock samples were taken. Minor gold-bearing pyrite-arsenopyrite stringers were noted in cherts of the Shoemaker Formation.
In 1987 QPX Minerals completed 3 NQ drillholes (524 m), took 301 rock samples, 3005 soil samples and 50 line kilometers of ground magnetics and EM, in claims to the north and south of the PDL claim. (Assessment Report 18251).
In 1988 QPX Minerals completed 23 trenches totaling 650 metres (Assessment Report 18284). During the 1988 exploration, an argillic-altered and silicified system was discovered on the Astro 34 claim (east of the PDL claim and optioned from Pacific Petroleum) in biotite porphyritic andesite of the Marron volcanics. This is the area now covered by the current Astro 2006 property.
Later in 1988 and early 1989 QPX Minerals completed five reverse-circulation holes totaling approximately 250 metres and 5 trenches totaling 150 metres in the new showing area on their Astro 34 claim (Assessment Report 18527). Anomalous gold (up to 0.705 g/t Au), silver (up to 14.8 g/t Ag) and molybdenum (up to 0.15 %) values over 3 metre sections from reverse circulation drillhole PDL-89-RC-2 were found associated with chalcedonic veinlets in argillically altered Kitley Member volcanics of the Marron Formation. Magnetometry and VLF-EM surveys on 25-50 m spaced lines were completed over a 400 m x 400 m area. Three very well defined conductive lineaments with corresponding magnetic lows were identified, only a small (50 m x 100 m area) portion of one of these anomalies was tested by trenching and/or drilling.
In 1993 the claim database indicates that Petro Canada was owner of the Astro 34 claim and that they let the claim lapse.
No recorded work has occurred in the area of the current Astro claims since the 1989 RC drilling program, even though the last recorded work recommended extensions of grid coverage for VLF-EM/Mag, a test soil survey over the showing area, and trenching and drilling of the current geophysical anomalies.
In 2003 the author conducted a modest geological and geochemical program consiting of limited soil sampling and an investigation of the small gulleys that reflect underlying structures and concluded that soil sampling is partially effective in areas of minor bedrock and that the gulleys and structures extend farther than the previous geophysical program.
VII. REGIONAL AND PROPERTY GEOLOGY
The showing area lies along the western margin of a fault-bounded basin of Eocene Penticton Group rocks (shown in tan on following figure). To the west Carboniferous to Triassic Shoemaker Formation rocks (shown as blue on following figure) consisting mainly of blue-grey chert, minor limestone and greenstone that have been intruded by pyroxenite, hornblendite and serpentinite. The contact between the chert and greenstone (widely silicified) is gradational over widths of up to 10 metres. Bedding strikes northeast with moderate to steep dips to the southeast. To the east at the base of the Penticton Group lies the Springbrook Formation that consists of massive, unsorted, polymictic conglomerate and breccia with lesser sandstone and tuff. The matrix of the conglomerate and breccia is silty and green. Clasts are dominantly volcanic (45 %) and chert (35%) with lesser metamorphic rocks (10%), sediments (5%) and intrusions (5%). This is overlain by trachyandesite and andesite flows with conspicuous glomerophenocrytic clots of feldspar of the Kitley Lake Member. Highly vesicular, pyroxene-rich basaltic andesite of the Kearns Creek Member overlies the Kitley Lake member. Several north-trending faults also cut through the area and probably represent downthrown blocks as part of the Trout Lake Graben mapped by Church, 1973.
[Figure 3: Regional Geology and Mineral Showings (Scale - 1:250,000]
VIII. LOCAL AND PROPERTY MINERALIZATION
Two styles of gold mineralization are noted in the immediate area and consist of east-west trending small pyrite-arsenopyrite stringers in chert breccia of the Shoemaker Formation at the PDL occurrence and in argillic and silicificied systems in biotite porphyritic andesite of the Marron volcanics at the Astro occurrence.
The highest results from the pyrite-arsenopyrite stringers at PDL were from grab sample PDL-556 in 1987 which yielded 30.3 g/t Au, 22.5 g/t Ag, 0.25% Cu, 0.14% Pb, 0.57 % Zn and 3.74% As. An abandoned 10-metre adit and an old trench in area also exposed small discontinuous massive sulphide lenses.
More pertinent and covered by the current Astro 2006 claims is the argillic altered and silicified system, which is up to 20 metres wide, where tested over an open ended strike length of 140 metres. The argillic alteration envelops a silicified core, up to 3 metres wide, however reverse circulation drilling indicates a widening of silicification to 14 metres true width at a depth of 47 metres. This may be the result of the merging of two zones at depth, which appear to dip near vertical and occur along north trending faults. Anomalous gold (up to 0.70 g/t), silver (up to 14.8 g/t) and molybdenum (up to 0.15%)
values, over 3 metre sections from the drilling were found to be associated with chalcedonic veinlets in the argillically altered Maaron volcanics.
During previous geological investigations by the author it was noted that the north trending structure(s) that intersect the 50 m x 100 m area investigated in 1988 and 1989 continue to the north for over 1 kilometre and south for at least 300 metres where the inferred structure enters valley cover. The area to the north is now easily accessed with fairly recent selective logging (pine beetle?).
IX. PREVIOUS GEOPHYSICS (AFTER ASSESSMENT REPORT 18527)
In the late fall of 1988 a small grid was established over the Astro 34 showing. A 400 metre long baseline was run at azimuth 360 degrees with 4.6 kilometres of crosslines spaced 25-50 metres apart. Lloyd Geophysics of Vancouver B.C using an EDA Omni Plus combination unit conducted magnetometer and VLF-EM surveys.
Three very well defined, north-south trending conductors were identified by the VLF-EM Survey. Only the central portion of the westernmost conductive lineament corresponds with trenching and drilling which tested the showing area. Follow up of these conductors is strongly recommended.
Along portions of the strike length of the VLF-EM conductors there is excellent correlation with magnetic lows. These zones probably represent zones of alteration (silicification) and warrant testing (by drilling)
X. PREVIOUS TRENCHING
The last assessment report (# 18527) indicates that 5 trenches totaling approximately 150 metres were dug and exposed the silicified /argillically altered zone (s). Deep overburden however made it impossible to follow the zone along strike with the equipment available. Only weakly anomalous gold values (to 235 ppb Au) and silver (to 7.8 ppm Ag) were obtained from trench samples. Previous rock chip sampling had returned values to 1030 ppb Au (PDL 88-075) and 34.1 ppm Ag (PDL 88-077).
XI. PREVIOUS DRILLING
A total of 5 reverse-circulation holes totaling approximately 250 metres were drilled in 1989 along 50 metres of strike. Three of the holes (PDL-RC-3, 4,5) were drilled on an old road in the south an angled easterly at -45, -80 and a vertical hole. The first hole was drilled approximately 25 metres north of this point and drilled east at -65 degrees. The second hole was drilled approximately another 25 metres north and oriented westerly. This second hole returned the most significant results which include 40 feet of 414 ppb Au which includes 20 feet of 650 ppb Au, located approximately 10 metres below surface.
XII. RECOMMENDATIONS AND CONCLUSIONS
The Astro 2006 Property has been inactive since 1989 (aside from a modest examination by the author in 2003) although the last recorded work program (Assessment Report 18527) recommended the extension of grid coverage, detailed geological mapping and sampling, magnetometer and VLF-EM coverage, a test soil sampling grid over the showing area and further testing by trenching and drilling of both current and newly expected geophysical anomalies.
Trenching in 1988 was successful in exposing a zone of silicified and argillically altered volcanics up to 20 metres in width over a strike length of 140 metres. Anomalous gold values were returned from this work and recommendations included the future use of a larger backhoe.
Reverse circulation drilling (5 holes totaling ~ 250 m) in 1989 followed the alteration to a depth of 47 metres below surface at which point there was no evidence of a decrease in the strength or size of the system. Anomalous gold and silver values were obtained from drill samples (to 705 ppb Au and 14.8 ppm Ag) over 10 foot runs.
This previous work has now laid the groundwork to quickly and efficiently builds upon the work from more than 15 years ago that has never been followed up. Exploration successes at the nearby Dusty Mac and Vault Projects as well as recent successes in a similar setting at Kinross' Emmanuel Creek Mine in the Republic Camp bode well for renewed exploration in the Astro 2006 area.
At Astro north-south structures which probably represent graben faults of the Trout Lake graben have been only partially tested in a 50 m x 100 m area and have returned grab samples to 1030 ppb Au and reverse circulation chips over 10 foot runs of 705 ppb Au. Although these values are by no means economical they indicate that they system is gold bearing and similar zones at Emmanual Creek (ie. "0.02 opt Au Project") have allowed them to vector in and find new "ore" zones. A wider zone of clay alteration with smaller zones of silicification indicates that areas with more silicification need to be located, possibly at depth or along strike.
A 400 m x 400 m VLF-EM/Mag grid over the showing area has indicated at least 3 north-south coincident EM/Mag anomalies of which only the central portion of the westernmost anomaly has been tested. Expansion of this grid and testing of the current anomalies by further trenching and drilling was recommended but not undertaken.
A soil test grid was proposed over the showing area but appears to have never been conducted.
Simple prospecting on trend of the geophysical anomalies and more widespread structures along with a test soil line over the showing area is recommended at the very least.
The expansion of the 1988 grid for the purpose of conducting magnetometer and VLF-EM surveys (which have been shown to be highly effective) is also recommended and soil sampling if also proven to be effective in the test line.
Trenching of anomalous structures followed by diamond drilling could quickly follow in the mostly logged off and easily accessible area.
ASTRO 2006 COST PROPOSAL
PHASE 1 COST
Soil sampling and prospecting (14 mandays) 7,000
Geochemical Analyses (150 soils, 50 rocks) 5,000
Data evaluation and reporting 2,000
Contingency 1,000
subtotal 15,000
------
PHASE 2
Geophysical Surveys ( 35 km Mag-VLF) 35,000
Trenching- excavator (100 hours @ $125/hr) 12,500
Trenching-sampling (500 rocks) 12,500
Geological supervision 5,000
Data evaluation and reporting 5,000
Contingency 5,000
subtotal 75,000
------
GRAND TOTAL 90,000
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XIII. REFERENCES
Energy Mines and Petroleum Resources Assessment Reports 14062,16674,I8251, 18284, 18527 and 27469.
Church, B.N. 1973: Geology of the White Lake Basin, Bulletin 61
APPENDIX 1 STATEMENT OF QUALIFICATIONS
To Accompany Astro 2006 Geology Report, British Columbia, Canada, dated August 3, 2006. I, Adam Travis,B.Sc., of 5093 Cousins Place, Peachland , British Columbia V0H 1X2 do hereby certify that:
I am a consulting geologist with an office at 5093 Cousins Place, Peachland , British Columbia V0H 1X2
I graduated from the University of British Columbia in 1990 and was awarded a B.Sc. in Geology.
I have practiced my geological profession since 1986 in many parts of Canada, the United States, Mexico, China and Africa.
I have previously worked on and am familiar with the Astro property contained within this report and control the private company (Cazador Resources ltd.) which is the underlying vendor of the property.
I have gathered my information for this report from government publications, internal company memos, geological field notes and data that are believed to he reliable and accurate.
I hereby grant my permission to Zebra Resources to use this Geological Report for whatever purposes it wants, subject to the disclosures set out in this Certificate.
Dated and Signed this 3rd day of August, 2006 in Peachland, B.C
Signed /s/ Adam Travis
----------------------
Adam Travis, B. Sc.
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