UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
NEVADA 1000 Applied For ------------- --------------------------- ---------------- (State or (Primary Standard Industrial (I.R.S. Employer jurisdiction of Classification Code Number) Identification No.) jurisdiction of Classification Code Number) Identification No.) |
incorporation or
organization)
Boss Minerals, Inc.
Andrei Krioukov, President
318 Homer Street, Suite 400
Vancouver, British Columbia
Canada V6B 2V2
Telephone: (604) 602-7591
Facsimile: (604) 602-7593
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(Address and telephone number of principal executive offices)
Val-u-corp Services, Inc.
1802 N Carson Street, Suite 212
Carson City, Nevada, 89701
Telephone: 775-887-8853
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(Name, address and telephone number of agent for service)
Approximate date of
proposed sale to the public: as soon as practicable after
the effective date of this
Registration Statement.
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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, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
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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
(1) Based on the last sales price on August 16, 2004
(2) Estimated solely for the purpose of calculating the registration
fee in accordance with Rule 457 under the Securities Act.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY DETERMINE.
SUBJECT TO COMPLETION, Dated November 22, 2004
The purchase of the securities offered through this prospectus involves a high
degree of risk. SEE SECTION ENTITLED "RISK FACTORS" ON PAGES 6-10
The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is 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 or sale is not permitted.
The selling shareholders will sell our shares at $0.01 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. We determined this offering price based upon the price of the last sale of our common stock to investors.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The Date Of This Prospectus Is: November 22, 2004
Table Of Contents
PAGE
Summary .................................................................... 4
Risk Factors ............................................................... 5
- If we do not obtain additional financing, our business
will fail ............................................................. 5
- Because we have not commenced business operations, we face
a high risk of business failure ....................................... 6
- Because of the speculative nature of exploration of mining
properties, there is substantial risk that our business
will fail ............................................................. 6
- We need to continue as a going concern if our business is
to succeed. Our independent auditor has raised doubt about
our ability to continue as a going concern............................. 6
- Because of the inherent dangers involved in mineral
exploration, there is a risk that we may incur liability or
damages as we conduct our business .................................... 7
- Even if we discover commercial reserves of precious metals
on the Mosquito King Property, we may not be able to
successfully obtain commercial production ............................. 7
- If we become subject to burdensome government regulation
or other legal uncertainties, our business will be
negatively affected ................................................... 7
- Because our directors own 66.66% of our outstanding stock, they could
control and make corporate decisions that may be disadvantageous
to other minority stockholders ......................................... 7
- Because our president has other business interests,
he may not be able or willing to devote a sufficient
amount of time to our business operations, causing our
business to fail ...................................................... 7
- Because management has no technical experience in mineral
exploration, our business has a high risk of failure................... 8
- If a market for our common stock does not develop,
shareholders may be unable to sell their shares ....................... 8
- A purchaser is purchasing penny stock which limits the
ability to sell stock ................................................. 8
Use of Proceeds ............................................................ 9
Determination of Offering Price ............................................ 9
Dilution ................................................................... 9
Selling Securityholders .................................................... 9
Plan of Distribution ....................................................... 12
Legal Proceedings .......................................................... 13
Directors, Executive Officers, Promoters and Control Persons................ 13
Security Ownership of Certain Beneficial Owners and Management ............. 15
Description of Securities .................................................. 15
Interest of Named Experts and Counsel ...................................... 16
Disclosure of Commission Position of Indemnification for
Securities Act Liabilities ................................................. 17
Organization Within Last Five Years ........................................ 17
Description of Business .................................................... 17
Plan of Operations ......................................................... 22
Description of Property .................................................... 23
Certain Relationships and Related Transactions ............................. 23
Market for Common Equity and Related Stockholder Matters ................... 23
Executive Compensation ..................................................... 24
Financial Statements ....................................................... 25
Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure........................................................ 38
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Summary
Prospective investors are urged to read this prospectus in its entirety.
We intend to be in the business of mineral property exploration. To date, we have not conducted any exploration on our sole mineral property, the Mosquito King property (the "Mosquito King") located in the Kamloops Mining Division of British Columbia, Canada. Boss Minerals, Inc. ("Boss") was granted an option to acquire a 100% interest in twenty mineral claims comprising the Mosquito King property.
Our objective is to conduct mineral exploration activities on the Mosquito King property in order to assess whether it possesses economic reserves of silver and zinc. We have not yet identified any economic mineralization on the property. Our proposed exploration program is designed to search for an economic mineral deposit.
We were incorporated on February 17, 2004, under the laws of the state of Nevada. Our principal offices are located at 400 Homer Street, Suite 318, Vancouver, British Columbia, Canada. Our telephone number is (604)602-7591.
The Offering:
Securities Being Offered Up to 2,500,000 shares of common stock.
Offering Price The selling shareholders will sell our
shares at $0.01 per share until our shares
are quoted on the OTC Bulletin Board, and
thereafter at prevailing market prices or
privately negotiated prices. We
determined this offering price based upon
the price of the last sale of our common
stock to investors.
Terms of the Offering The selling shareholders will determine when and
how they will sell the common stock offered in this
prospectus.
Termination of the Offering The offering will conclude when all of the 2,500,000
shares of common stock have been sold, the shares
no longer need to be registered to be sold or we
decide to terminate the registration of the shares.
Securities Issued
And to be Issued 7,500,000 shares of our common stock are issued and
outstanding as of the date of this prospectus. All
of the common stock to be sold under this prospectus
will be sold by existing shareholders.
Use of Proceeds We will not receive any proceeds from the sale of
the common stock by the selling shareholders.
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Summary Financial Information Balance Sheet Data September 30, 2004 ------------------ ------------------ Cash $26,964 Total Assets $26,964 Liabilities $16,615 Total Stockholders' Equity $10,349 Statement of Loss and Deficit |
From Incorporation on
February 17, 2004 to September 30, 2004
Revenue $ 0
Net Loss and Deficit ($26,651)
Risk Factors
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An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this prospectus before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously harmed. The trading price of our common stock could decline due to any of these risks, and you may lose all or part of your investment.
IF WE DO NOT OBTAIN ADDITIONAL FINANCING, OUT BUSINESS WILL FAIL.
Our current operating funds are less than necessary to complete all intended exploration of the Mosquito King property, and therefore we will need to obtain additional financing in order to complete our business plan. As of November 22, 2004, we had cash in the amount of $18,318. We currently do not have any operations and we have no income. As well, we will not receive any funds from this registration.
Our business plan calls for significant expenses in connection with the exploration of the Mosquito King property. While we have sufficient funds to conduct initial exploration on the property, we will require additional financing in order to determine whether the property contains economic mineralization and to cover our anticipated administrative costs. We will also require additional financing if the costs of the exploration of the Mosquito King property are greater than anticipated. Even after completing all proposed exploration, we will not know if we have a commercially viable mineral deposit.
We will require additional financing to sustain our business operations if we are not successful in earning revenues once exploration is complete. We do not currently have any arrangements for financing and may not be able to find such financing if required. Obtaining additional financing would be subject to a number of factors, including the market price for silver and zinc, investor acceptance of our property 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. The only other anticipated alternative for the financing of further exploration would be advances from related parties and joint venture or sale of a partial interest in the Mosquito King property to a third party in exchange for cash or exploration expenditures, which is not presently contemplated.
BECAUSE WE HAVE NOT COMMENCED BUSINESS OPERATIONS, WE FACE A HIGH RISK OF BUSINESS FAILURE.
We have not yet commenced exploration on the Mosquito King property. Accordingly, we have no way to evaluate the likelihood that our business will be successful. We were incorporated on February 17, 2004 and to date have been involved primarily in organizational activities and the acquisition of the option in the mineral property. 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 therefore expect to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from development of the Mosquito King property and the production of minerals from the claims, 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 OF THE SPECULATIVE NATURE OF EXPLORATION OF MINING PROPERTIES, THERE IS A SUBSTANTIAL RISK THAT OUR BUSINESS WILL FAIL.
The search for valuable minerals as a business is extremely risky. The likelihood of our mineral claims containing economic mineralization or reserves of copper is extremely remote. Exploration for minerals is a speculative venture necessarily involving substantial risk. In all probability, the Mosquito King property does not contain any reserves and funds that we spend on exploration will be lost. As well, problems such as unusual or unexpected formations and other conditions are involved in mineral exploration and often result in unsuccessful exploration efforts. In such a case, we would be unable to complete our business plan.
WE NEED TO CONTINUE AS A GOING CONCERN IF OUR BUSINESS IS TO SUCCEED. OUR INDEPENDENT AUDITOR HAS RAISED DOUBT ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN.
The Independent Auditor's Report to our audited financial statements for the period ended September 30, 2004 indicates that there are a number of factors that raise substantial doubt about our ability to continue as a going concern. Such factors identified in the report are that we have no source of revenue and our dependence upon obtaining adequate financing. If we are not able to continue as a going concern, it is likely investors will lose all of their investment.
BECAUSE OF THE INHERENT DANGERS INVOLVED IN MINERAL EXPLORATION, THERE IS A RISK THAT WE MAY INCUR LIABILITY OR DAMAGES AS WE CONDUCT OUR BUSINESS.
The search for valuable minerals involves numerous hazards. As a result, we may become subject to liability for such hazards, including pollution, cave-ins and other hazards against which we cannot insure or against which we may elect not to insure. The payment of such liabilities may have a material adverse effect on our financial position.
EVEN IF WE DISCOVER COMMERCIAL RESERVES OF PRECIOUS METALS ON THE MOSQUITO KING
PROPERTY, WE MAY NOT BE ABLE TO SUCCESSFULLY COMMENCE COMMERCIAL PRODUCTION.
The Mosquito King property does not contain any known bodies of mineralization. If our exploration programs are successful in establishing silver and zinc of commercial tonnage and grade, we will require additional funds in order to place the property into commercial production. We may not be able to obtain such financing.
IF WE BECOME SUBJECT TO BURDENSOME GOVERNMENT REGULATION OR OTHER LEGAL UNCERTAINTIES, OUR BUSINESS WILL BE NEGATIVELY AFFECTED.
There are several governmental regulations that materially restrict mineral property exploration and development. Under Canadian mining law, to engage in certain types of exploration will require 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 current exploration plans, if we proceed to commence drilling operations on the Mosquito King property, we will incur modest regulatory compliance costs.
In addition, the legal and regulatory environment that pertains to the exploration of ore is uncertain and may change. Uncertainty and new regulations could increase our costs of doing business and prevent us from exploring for ore deposits. The growth of demand for ore may also be significantly slowed. This could delay growth in potential demand for and limit our ability to generate revenues. 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.
BECAUSE OUR DIRECTORS OWN 66.7% OF OUR OUTSTANDING COMMON STOCK, THEY COULD MAKE AND CONTROL CORPORATE DECISIONS THAT MAY BE DISADVANTAGEOUS TO OTHER MINORITY SHAREHOLDERS.
Our directors own approximately 66.7% of the outstanding shares of our common stock. Accordingly, they will have a significant influence in determining the outcome of all corporate transactions or other matters, including mergers, consolidations, and the sale of all or substantially all of our assets. They will also have the power to prevent or cause a change in control. The interests of our directors may differ from the interests of the other stockholders and thus result in corporate decisions that are disadvantageous to other shareholders.
BECAUSE OUR PRESIDENT HAS OTHER BUSINESS INTERESTS, HE MAY NOT BE ABLE OR WILLING TO DEVOTE A SUFFICIENT AMOUNT OF TIME TO OUR BUSINESS OPERATIONS, CAUSING OUR BUSINESS TO FAIL.
Our president, Mr. Andrei Krioukov only spends approximately 18% of his business time providing his services to us. While Mr. Krioukov presently possesses adequate time to attend to our interests, it is possible that the demands on Mr. Krioukov 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.
BECAUSE MANAGEMENT HAS NO TECHNICAL EXPERIENCE IN MINERAL EXPLORATION, OUR BUSINESS HAS A HIGHER RISK OF FAILURE.
None of our directors has any technical training in the field of geology and specifically in the areas of exploring for, starting 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. As well, with no direct training or experience, our management may not be fully aware of the specific requirements related to working in this industry. Their decisions and choices may not be well thought out and our operations, earnings and ultimate financial success may suffer irreparable harm as a result.
IF A MARKET FOR OUR COMMON STOCK DOES NOT DEVELOP, SHAREHOLDERS MAY BE UNABLE TO SELL THEIR SHARES.
There is currently no market for our common stock and no certainty that a market will develop. We currently plan to apply for listing of our common stock on the over the counter bulletin board upon the effectiveness of the registration statement, of which this prospectus forms a part. Our shares may never trade on the bulletin board. If no market is ever developed for our shares, it will be difficult for shareholders to sell their stock. In such a case, shareholders may find that they are unable to achieve benefits from their investment.
A PURCHASER IS PURCHASING PENNY STOCK WHICH LIMITS HIS OR HER ABILITY TO SELL THE STOCK.
The shares offered by this prospectus constitute penny stock under the Exchange Act. The shares will remain penny stock 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, thus limiting investment liquidity. Any broker-dealer engaged by the purchaser for the purpose of selling his or her shares in our company will be subject to rules 15g-1 through 15g-10 of the Exchange Act. Rather than creating a need to comply with those rules, some broker-dealers will refuse to attempt to sell penny stock.
Please refer to the "Plan of Distribution" section for a more detailed discussion of penny stock and related broker-dealer restrictions.
Forward-Looking Statements
This prospectus contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend and similar expressions to identify such forward-looking statements. You should not place too much reliance on these forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us described in the "Risk Factors" section and elsewhere in this prospectus.
Use Of Proceeds
We will not receive any proceeds from the sale of the common stock offered through this prospectus by the selling shareholders.
Determination Of Offering Price
The selling shareholders will sell our shares at $0.01 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. We determined this offering price, based upon the price of the last sale of our common stock to investors.
Dilution
The common stock to be sold by the selling shareholders is common stock that is currently issued and outstanding. Accordingly, there will be no dilution to our existing shareholders.
Selling Securityholders
The selling securityolders named in this prospectus are offering all of the 2,500,000 shares of common stock offered through this prospectus. These shares were acquired from us in a private placement that were exempt from registration under Regulation S of the Securities Act of 1933. These shares were acquired from us in an offering that was exempt from registration under Regulation S of the Securities Act of 1933 and was completed on August 16, 2004.
The following table provides as of the date of this prospectus, information regarding the beneficial ownership of our common stock held by each of the selling shareholders, including:
1. the number of shares owned by each prior to this offering;
2. the total number of shares that are to be offered for each;
3. the total number of shares that will be owned by each upon
completion of the offering; and
4. the percentage owned by each upon completion of the offering.
Total Number
Of Shares To Total Shares Percent
Be Offered For Owned Upon Owned Upon
Name Of Shares Owned Selling Completion Completion
Selling Prior To This Shareholders Of This Of This
Stockholder Offering Account Offering Offering
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Kevin Booth 100,000 100,000 Nil Nil
6611 Southoaks Cres.,
Suite #1105
Burnaby, BC
Shvonne Deptuck 100,000 100,000 Nil Nil
5768 Neville Street
Burnaby, BC
Nick Twamley 100,000 100,000 Nil Nil
5768 Neville Street
Burnaby, BC
Alvin Krishanna 100,000 100,000 Nil Nil
6949 Fleming Street
Vancouver, BC
Mirela Sivic 100,000 100,000 Nil Nil
7569 Humphries Court,#3
Burnaby, BC
Calvin Ng 100,000 100,000 Nil Nil
3451 East 51st Avenue
Vancouver, BC
Fahimeh Shakeryroushan 100,000 100,000 Nil Nil
3550 Woodland Drive, #6
Port Coquitlam, BC
Marcy Deptuck 100,000 100,000 Nil Nil
7249 14th Avenue, #152
Burnaby, BC
Rika Collins 100,000 100,000 Nil Nil
6580 Marlborough Ave.,
Suite #209
Burnaby, BC
Jeremy Johnson 100,000 100,000 Nil Nil
6580 Marlborough Ave,
Suite #209
Burnaby, BC
Nilgoun Shamsian 100,000 100,000 Nil Nil
1215 Lansdowne Drive,
Suite #415
Coquitlam, BC
David Burns 100,000 100,000 Nil Nil
6086 Inglewood Place
Delta, BC
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Total Number
Of Shares To Total Shares Percent
Be Offered For Owned Upon Owned Upon
Name Of Shares Owned Selling Completion Completion
Selling Prior To This Shareholders Of This Of This
Stockholder Offering Account Offering Offering
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Sonya Mandic 100,000 100,000 Nil Nil
6508 Telford Avenue,
Suite #201
Burnaby, BC
Arezou Setoudegan 100,000 100,000 Nil Nil
3550 Woodland Drive, #6
Port Coquitlam, BC
Tatjana Mandic 100,000 100,000 Nil Nil
6508 Telford Avenue,
Suite #201
Burnaby, BC
Jelena Tintor 100,000 100,000 Nil Nil
6444 Silver Avenue
Burnaby, BC
P. M. McElheron 100,000 100,000 Nil Nil
190 English Bluff Road
Delta, BC
Goran Tintor 100,000 100,000 Nil Nil
6570 Burlington Avenue,
Suite #204
Burnaby, BC
Audrey J. McElheron 100,000 100,000 Nil Nil
190 English Bluff Road
Delta, BC
Doug Raphael 100,000 100,000 Nil Nil
5055 Imperial Street,
Suite #101
Burnaby, BC
Sarah Needham 100,000 100,000 Nil Nil
2557 Derbyshire Way
North Vancouver, B.C.
Monette McElheron 100,000 100,000 Nil Nil
5558 15B Avenue, #207
Delta, BC
Kseniya Stepanova 100,000 100,000 Nil Nil
1307 Franklin Street
Coquitlam, BC
Melanie Kumar 100,000 100,000 Nil Nil
7143 17th Avenue
Burnaby, BC
Heather MacPherson 100,000 100,000 Nil Nil
5620 Ewart Street
Burnaby, BC
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Elizabeth Anne Rodgers 100,000 100,000 Nil Nil
190 English Bluff Road
Tsawwassen, BC
Each of the above shareholders beneficially owns and has sole voting and investment over all shares or rights to the shares registered in his or her name. The numbers in this table assume that none of the selling shareholders sells shares of common stock not being offered in this prospectus or purchases additional shares of common stock, and assumes that all shares offered are sold. The percentages are based on 7,500,000 shares of common stock outstanding on the date of this prospectus.
None of the selling shareholders:
(1) has had a material relationship with us other than as a shareholder at any time within the past three years; or
(2) has ever been one of our officers or directors.
None of the selling shareholders is a broker-dealer or affiliate of a broker dealer.
Plan Of Distribution
The selling shareholders may sell some or all of their common stock in one or more transactions, including block transactions.
The selling shareholders will sell our shares at $0.01 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. We determined this offering price arbitrarily based upon the price of the last sale of our common stock to investors. The shares may also be sold in compliance with the Securities and Exchange Commission's Rule 144.
We are bearing all costs relating to the registration of the common stock. These are estimated to be $12,000. The selling shareholders, however, will pay any commissions or other fees payable to brokers or dealers in connection with any sale of the common stock.
The selling shareholders must comply with the requirements of the Securities Act and the Exchange Act in the offer and sale of the common stock. In particular, during such times as the selling shareholders may be deemed to be engaged in a distribution of the common stock, and therefore be considered to be an underwriter, they must comply with applicable law and may, among other things:
1. Not engage in any stabilization activities in connection with our common stock;
2. Furnish each broker or dealer through which common stock may be offered, such copies of this prospectus, as amended from time to time, as may be required by such broker or dealer; and
3. Not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities other than as permitted under the Exchange Act.
The Securities 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).
The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, deliver a standardized risk disclosure document prepared by the Commission, which:
* contains a description of the nature and level of risk in the market for
penny stocks in both public offerings and secondary trading;
* contains a description of the broker'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;
* contains a brief, clear, narrative description of a dealer market,
including "bid" and "ask" prices for penny stocks and the significance of
the spread between the bid and ask price;
* 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 Commission shall require by rule or
regulation;
The broker-dealer also must provide, prior to proceeding with any transaction in a penny stock, the customer:
* with bid and offer quotations for the penny stock;
* details of 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 those securities.
Legal Proceedings
We are not currently a party to any legal proceedings. Our address for service of process in Nevada is 1802 N. Carson Street, Suite 212, Carson City, Nevada, 89701.
Directors, Executive Officers, Promoters And Control Persons
Our executive officers and directors and their respective ages as of the date of this prospectus are as follows:
Directors:
Name of Director Age
Andrei Krioukov 43
Alexei Jirniaguine 44
Executive Officers:
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Name of Officer Age Office
--------------------- ----- -------
Andrei Krioukov 43 President and Chief
Executive Officer
Alexei Jirniaguine 44 Secretary and Treasurer
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Biographical Information
Set forth below is a brief description of the background and business experience of each of our executive officers and directors for the past five years.
Mr. Andrei Krioukov has acted as our President, chief executive officer, and as a director since our incorporation on February 17, 2004. Mr. Krioukov graduated from university and earned his engineering degree in 1983. From 1986 to 1994, he worked as a senior manager at one of the divisions of the chemical concentrates plant in Russia. From 1996 to 2001, Mr. Krioukov worked as an accountant and controller with various public mining companies located in Vancouver, British Columbia. In 2001, he joined a Vancouver-based Chartered Accountants Firm where he worked as an auditor and was involved in the audit of reporting companies in Canada and United States. Since 2003, Mr. Krioukov has provided accounting consulting services to public companies through his private consulting firm.
Mr. Krioukov does not have any professional training or technical credentials in the exploration, development and operation of mines.
Mr. Krioukov intends to devote approximately 18% of his business time to our affairs.
Mr. Alexei Jirniaguine has acted as our secretary, treasurer and as a director since our incorporation on February 17, 2004. Mr. Jirniaguine has a Masters degree in physical chemistry and a scientific background in this field. As a director, he participated in industrial projects in common with Institute of Catalysis of Russian Academy of Science. He also acts as a director of a private company, ALT Database Solutions, providing consulting services for companies operating with large business applications and databases. In the past five years, various Vancouver-based companies employed him as a database developer and analyst. Mr. Jirniaguine was employed by the University of British Columbia as a senior analyst in 2003 and 2004. Currently he works as a database analyst at the City Hall of Coquitlam, British Columbia.
Mr. Jirniaguine does not have any professional training or technical credentials in the exploration, development and operation of mines.
Mr. Jirniaguine intends to devote approximately 10% of his business time to our affairs.
Term of Office
Our directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.
Significant Employees
We have no significant employees other than the officers and directors described above.
Security Ownership Of Certain Beneficial Owners And Management
The following table provides the names and addresses of each person known to us to own more than 5% of our outstanding common stock as of the date of this prospectus, and by the officers and directors, individually and as a group. Except as otherwise indicated, all shares are owned directly.
Amount of
Title of Name and address beneficial Percent
Class of beneficial owner ownership of class
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Common Andrei Krioukov 2,500,000 33.33%
Stock President, Chief
Executive Officer
and a Director
#400, 318 Homer Street,
Vancouver, B.C., Canada
Common Alexei Jirniaguine 2,500,000 33.33%
Stock Secretary, Treasurer
and Director
219 East 12th Avenue,
Vancouver B.C., Canada
Common All officers and directors 5,000,000 66.66%
Stock as a group that consists of shares
two people
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The percent of class is based on 7,500,000 shares of common stock issued and outstanding as of the date of this prospectus.
Description Of Securities
General
Our authorized capital stock consists of 75,000,000 shares of common stock at a par value of $0.001 per share.
Common Stock
As of November 22, 2004, there were 7,500,000 shares of our common stock issued and outstanding that are held by 27 stockholders of record. Holders of our common stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of common stock do not have cumulative voting rights. Therefore, holders of a majority of the shares of common stock voting for the election of directors can elect all of the directors. Two persons present and being, or representing by proxy, shareholders are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our articles of incorporation.
Holders of common stock are entitled to share in all dividends that the board of directors, in its discretion, declares from legally available funds. In the event of a liquidation, dissolution or winding up, each outstanding share entitles its holder to participate pro rata in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference over the common stock.
Holders of our common stock have no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to our common stock.
Preferred Stock
We do not have an authorized class of preferred stock.
Dividend Policy
We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.
Share Purchase Warrants
We have not issued and do not have outstanding any warrants to purchase shares of our common stock.
Options
We have not issued and do not have outstanding any options to purchase shares of our common stock.
Convertible Securities
We have not issued and do not have outstanding any securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our common stock.
Interests Of Named Experts And Counsel
No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant. Nor was any such person connected with the registrant as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.
Batcher & Zarcone, LLP, our legal counsel, has provided an opinion on the validity of our common stock.
The financial statements included in this prospectus and the registration statement have been audited by Manning Elliott, CA's, to the extent and for the periods set forth in their report appearing elsewhere in this document and in the registration statement filed with the SEC, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.
Disclosure Of Commission Position Of Indemnification For Securities Act Liabilities
Our directors and officers are indemnified as provided by the Nevada Revised Statutes and our Bylaws. These provisions provide that we shall indemnify a director or former director against all expenses incurred by him by reason of him acting in that position. The directors may also cause us to indemnify an officer, employee or agent in the same fashion.
We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to a court of appropriate jurisdiction. We will then be governed by the court's decision.
Organization Within Last Five Years
We were incorporated on February 17, 2004 under the laws of the state of Nevada. On that date, Andrei Krioukov and Alexei Jirniaguine were appointed as our directors. As well, Mr. Krioukov was appointed as our president and chief executive officer, while Mr. Jirniaguine was appointed as our secretary and treasurer.
Description Of Business
In General
We intend to commence operations as an exploration stage company. We will be engaged in the acquisition, and exploration of mineral properties with a view to exploiting any mineral deposits we discover that demonstrate economic feasibility. We have an option to acquire a 100% interest in 20 mineral claims collectively known as the Mosquito King property. There is no assurance that a commercially viable mineral deposit exists on the property. Further exploration will be required before a final evaluation as to the economic and legal feasibility is determined.
Our plan of operation is to conduct exploration work on the Mosquito King property in order to ascertain whether it possesses economic quantities of silver and zinc. There can be no assurance that economic mineral deposits or reserves, exist on the Mosquito King property until appropriate exploration work is done and an economic evaluation based on such work concludes that production of minerals from the property is economically feasible.
Even if we complete our proposed exploration programs on the Mosquito King property and we are successful in identifying a mineral deposit, we will have to spend substantial funds on further drilling and engineering studies before we will know if we have a commercially viable mineral deposit.
Mosquito King Property Option Agreement
On July 31, 2004, we entered into a Mineral Property Option Agreement (the "Agreement") with Rich River Exploration Ltd. and Mr. Craig A. Lynes (the "Optionors") of Grindrod, British Columbia, whereby the Optionors agreed to grant us a 100% undivided right, title and interest in total of twenty mineral claims located in the Kamloops Mining Division of British Columbia. In order to acquire a 100% interest in these claims, subject to a 2% net smelter returns royalty, we have to pay to the Optionors a total of $33,000 in the following manner:
(i) $3,000 by August 25, 2004 (paid);
(ii) an additional $5,000 by August 15, 2005; and
(iii) an additional $25,000 by August 15, 2006;
A net smelter returns royalty is the percentage of money that the royalty holder would receive from the sale of minerals from the property to a smelter, less refining charges, ore treatment charges, penalties and transportation costs.
Description, Location and Access
The Mosquito King claims are located in the Kamloops Mining Division, in south central British Columbia, approximately 100 kilometers east-northeast of the city of Kamloops. The property is approximately 31 kilometers from the Trans-Canada Highway and the main branch of the Canadian Pacific Railway. The property area is served by a network of logging roads and is accessible from a logging road that runs adjacent to Scotch Creek, about seven kilometers from the paved road.
The climate of the region is moderate, but a relatively high altitude makes the local climate colder and results in increased precipitation. Winter conditions may start as early as the end of October. Foliage found on the Mosquito King property primarily consists of cedar and, to a lesser extent, spruce, pine and deciduous trees.
Specifics of the claims are as follows:
Title to the Mosquito King Property
The Mosquito King property consists of twenty claims. These claims are registered in the name of Craig A. Lynes and are in good standing until November 17, 2005. The total area of the Mosquito King claims is 500 acres.
A "mineral claim" refers to a specific section of land over which a title holder owns rights to exploration to ground. Such rights may be transferred or held in trust. We have an option to purchase a 100% interest in the claims from the Optionors. The Optionors will transfer title to the claims to us if we exercise our option.
Exploration History
In 1972, a total of 219 tons of ore were mined at the Mosquito King property, resulting in the recovery of 173.9 kilograms of silver. In 1973, an additional 200 tons or ore were processed, yielding 22.6 kilograms of silver, 7.9 tonnes of lead, 6.1 tonnes of zinc and 42 grams of cadmium.
In 1978, Craigmont Mines Ltd. completed a program of grid emplacement and drilling on the Mosquito King property. Grid emplacement involves dividing a portion of the property being explored into small sections. Drilling involves extracting a long cylinder of rock from the ground to determine amounts of metals at different depths. Pieces of the rock obtained, known as drill core, are analysed for mineral content.
Government data also indicates that in 1979, mining operations on the property resulted in the production of 218 grams of gold, 35.6 kilograms of silver, 14.8 tonnes of lead and 12.3 tonnes of zinc. However, the source of this production has not been reported.
Geological Assessment Report: Mosquito King Property
We retained Mr. Bohumil Molak, a professional geologist, to complete an initial evaluation of the property and to prepare a geological summary report on the Mosquito King property. He attended the property during the last week of October 2004, but was unable to complete an initial geological review due to a heavy snow pack. We estimate that the property will not be accessible due to snow accumulation until approximately April 2004.
Based on his review of data relating to the Mosquito King property, Mr. Molak concludes that the Mosquito King property warrants further exploration, given the previous discovery of significant grades of silver and zinc mineralization. He also notes that there has never been a systematic sampling program on the property and that no modern exploration technology has ever been applied to the prospect. He recommends a two-phase exploration program to further evaluate the Mosquito King Property.
Phase I would consist of compiling past exploration data and sampling areas of the property that were previously explored. Sampling consists of a consulting geologist gathering soil or pieces of rock that appear to contain precious metals such as gold and silver. All samples gathered will be sent to a laboratory where they are crushed and analysed for metal content.
Phase II would consist of geological mapping and geophysical test surveys. Geological mapping involves plotting previous exploration data relating to the Mosquito King Property on a map in order to determine the best property locations to conduct subsequent exploration work.
Geophysical surveying is the search for mineral deposits by measuring the physical property of near-surface rocks, and looking for unusual responses caused by the presence of mineralization. Electrical, magnetic, gravitational, seismic and radioactive properties are the ones most commonly measured.
Proposed Budget
Approximate costs for the recommended two phase program are as following:
Phase One: Data Acquisition
Senior geologist: $1,500.00
Geological geophysical surveys: $1,000.00
Assays: $500.00
Transportation: $500.00
Geological report: $1,500.00
---------
Total Phase I Costs: $5,000.00
-19-
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Phase Two: Geological Survey and
Geophysical Survey
Senior geologist: $3,000.00
Geological geophysical surveys: $5,000.00
Assays: $2,000.00
Transportation: $1,000.00
Geological report: $3,000.00
Miscellaneous: $1,000.00
Total Phase II Costs: $15,000.00
----------
Total Program Costs: $20,000.00
==========
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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.
We will have to sustain the cost of reclamation and environmental mediation for all exploration and development work undertaken. The amount of these costs is not known at this time as we do not know the extent of the exploration program that will be undertaken beyond completion of the currently planned work programs. Because there is presently no information on the size, tenor, or quality of any resource or reserve at this time, it is impossible to assess the impact of any capital expenditures on earnings or our competitive position in the event a potentially economic deposit is discovered.
If we enter into production, the cost of complying with permit and regulatory environment laws will be greater than in the exploration phases because the impact on the project area is greater. Permits and regulations will control all aspects of any production program if the project continues to that stage because of the potential impact on the environment. Examples of regulatory requirements include:
- Water discharge will have to meet water standards;
- Dust generation will have to be minimal or otherwise re-mediated;
- Dumping of material on the surface will have to be re-contoured and re-vegetated;
- An assessment of all material to be left on the surface will need to be environmentally benign;
- Ground water will have to be monitored for any potential contaminants;
- The socio-economic impact of the project will have to be evaluated and if deemed negative, will have to be re-mediated; and
- There will have to be an impact report of the work on the local fauna and flora.
Employees
We have no employees as of the date of this prospectus other than our two directors.
Research and Development Expenditures
We have not incurred any other research or development expenditures since our incorporation.
Subsidiaries
We do not have any subsidiaries.
Patents and Trademarks
We do not own, either legally or beneficially, any patents or trademarks.
Reports to Security Holders
Although we are not required to deliver a copy of our annual report to our security holders, we will voluntarily send a copy of our annual report, including audited financial statements, to any registered shareholder who requests it. We will not be a reporting issuer with the Securities and Exchange Commission until our registration statement on Form SB-2 is declared effective.
We have filed a registration statement on Form SB-2, under the Securities Act of 1933, with the Securities and Exchange Commission with respect to the shares of our common stock offered through this prospectus. This prospectus is filed as a part of that registration statement, but does not contain all of the information contained in the registration statement and exhibits. Statements made in the registration statement are summaries of the material terms of the referenced contracts, agreements or documents of the company. We refer you to our registration statement and each exhibit attached to it for a more detailed description of matters involving the company, and the statements we have made in this prospectus are qualified in their entirety by reference to these additional materials. You may inspect the registration statement, exhibits and schedules filed with the Securities and Exchange Commission at the Commission's principal office in Washington, D.C. Copies of all or any part of the registration statement may be obtained from the Public Reference Section of the Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms. The Securities and Exchange Commission also maintains a web site at http://www.sec.gov that contains reports, proxy statements and information regarding registrants that file electronically with the Commission. Our registration statement and the referenced exhibits can also be found on this site.
Plan Of Operations
Our plan of operation for the twelve months following the date of this prospectus is to complete the recommended phase one and two exploration programs on the Mosquito King property consisting of resampling of old workings, geologic mapping, analytical and test surveys. We anticipate that the phase one program will cost approximately $5,000, while the phase two program will cost approximately $15,000. To date, we have not commenced exploration on the Mosquito King property.
We plan to commence the phase one exploration program on the Mosquito King property in spring of 2005, as soon as weather conditions in the area permit. The program should take approximately up to a one month to complete. We will then undertake the phase two work program during the summer of 2005. This program will also take approximately one month to complete.
We do not have any verbal or written agreement regarding the retention of any qualified engineer or geologist for this exploration program.
As well, we anticipate spending an additional $12,000 on professional fees, including fees payable in connection with the filing of this registration statement and complying with reporting obligations, and general administrative costs.
Total expenditures over the next 12 months are therefore expected to be $32,000.
We will require additional funding in order to proceed with the proposed phase two surveys and with any subsequent recommended work on the property. We anticipate that additional funding will be required in the form of equity financing from the sale of our common stock. However, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock to fund the second phase of the exploration program. We believe that debt financing will not be an alternative for funding the complete exploration program. We do not have any arrangements in place for any future equity financing.
Results Of Operations For The Period From Inception Through September 30, 2004
We have not earned any revenues from our incorporation on February 17, 2004 to September 30, 2004. We do not anticipate earning revenues unless we enter into commercial production on the Mosquito King property, which is doubtful. We have not commenced the exploration stage of our business and can provide no assurance that we will discover economic mineralization on the property, or if such minerals are discovered, that we will enter into commercial production.
We incurred operating expenses in the amount of $26,651 for the period from our inception on February 17, 2004 to September 30, 2004. These operating expenses were comprised of accounting and audit fees of $3,300, bank charges of $136, donated rent of $1,750, management and consulting donated services of $5,250, incorporation costs of $215, legal and organizational costs of $13,000 and mineral property costs of $3,000.
We have not attained profitable operations and are dependent upon obtaining financing to pursue exploration activities. For these reasons our auditors believe that there is substantial doubt that we will be able to continue as a going concern.
Description Of Property
We have an option to acquire a 100% interest, subject to a 2% net smelter returns interest, in twenty mineral claims comprising the Mosquito King property. We do not have an option in, own or lease any property other than the Mosquito King property.
Certain Relationships And Related Transactions
None of the following parties has, since our date of incorporation, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:
* Any of our directors or officers;
* Any person proposed as a nominee for election as a director;
* Any person who beneficially owns, directly or indirectly, shares
carrying more than 10% of the voting rights attached to our
outstanding shares of common stock;
* Our sole promoter, Andrei Krioukov;
* Any member of the immediate family of any of the foregoing persons.
A private company controlled by Andrei Krioukov, our president, provides accounting services to us. During the period ended September 30, 2004, the private company charged $300 for accounting services, which were charged to operations.
Mr. Krioukov also provides management services and office premises to us. The donated services are valued at $750 per month and the donated office premises are valued at $250 per month. During the period ended September 30, 2004, donated services of $5,250 and donated rent expense of $1,750 were charged to operations.
During the period ended September 30, 2004, Mr. Krioukov also advanced $100 to us in connection with the opening of our corporate bank account. This amount is unsecured, non-interest bearing and has no fixed term of repayment.
Mr. Krioukov charged us $3,000 during the period ended September 30, 2004 for his involvement in the preparation of our registration statement on Form SB-2. We have charged this amount to operations.
Market For Common Equity And Related Stockholder Matters
No Public Market for Common Stock
There is presently no public market for our common stock. We anticipate applying for trading of our common stock on the over the counter bulletin board upon the effectiveness of the registration statement of which this prospectus forms a part. However, we can provide no assurance that our shares will be traded on the bulletin board or, if traded, that a public market will materialize.
Stockholders of Our Common Shares
As of the date of this registration statement, we have 27 registered shareholders.
Rule 144 Shares
A total of 5,000,000 shares of our common stock are available for resale to the public after March 19, 2005 in accordance with the volume and trading limitations of Rule 144 of the Act. In general, under Rule 144 as currently in effect, a person who has beneficially owned shares of a company's common stock for at least one year is entitled to sell within any three month period a number of shares that does not exceed the greater of:
1. 1% of the number of shares of the company's common stock then outstanding which, in our case, will equal 75,000 shares as of the date of this prospectus; or
2. the average weekly trading volume of the company's common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.
Sales under Rule 144 are also subject to manner of sale provisions and notice requirements and to the availability of current public information about the company.
Under Rule 144(k), a person who is not one of the company's affiliates at any time during the three months preceding a sale, and who has beneficially owned the shares proposed to be sold for at least two years, is entitled to sell shares without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144.
As of the date of this prospectus, persons who are our affiliates hold all of the 5,000,000 shares that may be sold pursuant to Rule 144.
Registration Rights
We have not granted registration rights to the selling shareholders or to any other persons.
Dividends
There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends. The Nevada Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:
1. we would not be able to pay our debts as they become due in the usual course of business; or
2. our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of shareholders who have preferential rights superior to those receiving the distribution.
We have not declared any dividends, and we do not plan to declare any dividends in the foreseeable future.
Executive Compensation
Summary Compensation Table
The table below summarizes all compensation awarded to, earned by, or paid to our executive officers by any person for all services rendered in all capacities to us for the fiscal period ended September 30, 2004 and the subsequent period to the date of this prospectus.
Annual Compensation
Other Restricted Options/ LTIP Other
Stock * SARs payouts Comp
Name Title Year Salary Bonus Comp. Awarded (#) ($)
--------------------------------------------------------------------------------
Andrei Pres. 2004 $0 0 0 0 0 $3,000
Krioukov CEO &
Dir.
Alexei Sec. 2004 $0 0 0 0 0 0
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Jirniaguine & Treas.
Stock Option Grants
We have not granted any stock options to the executive officers since our inception.
Consulting Agreements
A private company controlled by Andrei Krioukov, our president, provides accounting services to us. During the period ended September 30, 2004, the private company charged $300 for accounting services, which were charged to operations. Mr. Krioukov provides management services and office premises to us. The donated services are valued at $750 per month and the donated office premises are valued at $250 per month. During the period ended September 30, 2004, donated services of $5,250 and donated rent expense of $1,750 were charged to operations. Mr. Krioukov has also charged us $3,000 for his role in preparing our registration statement on Form SB-2.
We do not have any employment or consulting agreement with Mr. Jirniaguine.
We do not pay Mr.Krioukov and Mr. Jirniaguine any amount for acting as a director of the Company.
Financial Statements
Index to Financial Statements:
1. Report of Independent Registered Public Accounting Firm;
2. Audited financial statements for the period ending September 30, 2004, including:
a. Balance Sheet;
b. Statement of Operations
c. Statement of Cash Flows; and
d. Statement of Stockholders' Equity;
e. Notes to Financial Statements
BOSS MINERALS, INC.
(An Exploration Stage Company)
FINANCIAL STATEMENTS
September 30, 2004
[LOGO]
MANNINNG ELLIOTT 11th floor, 1050 West Pender Street,
Vancouver, BC,Canada V6E 3S7
CHARTERED ACCOUNTANTS Phone: 604.714.3600 Fax:604.714.3669
Web: manningelliott.com
|
Independent Auditors' Report
To the Stockholders and Board of Directors
of Boss Minerals, Inc.
(An Exploration Stage Company)
We have audited the accompanying balance sheet of Boss Minerals, Inc. (An Exploration Stage Company) as of September 30, 2004 and the related statements of operations, stockholders' equity and cash flows for the period from February 17, 2004 (Date of Inception) to September 30, 2004. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit 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 audit provides a reasonable basis for our opinion.
In our opinion, the aforementioned financial statements present fairly, in all material respects, the financial position of Boss Minerals, Inc. (An Exploration Stage Company), as of September 30, 2004, and the results of its operations, cash flows and stockholders' equity for the period from February 17, 2004 (Date of Inception) to September 30, 2004, in conformity with generally accepted accounting principles used in the United States of America.
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company is in the early exploration stage and has losses from operations since inception. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also discussed in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ "Manning Elliott" CHARTERED ACCOUNTANTS Vancouver, Canada October 14, 2004 |
BOSS MINERALS, INC.
(An Exploration Stage Company)
BALANCE SHEET
September 30, 2004
(Expressed in US Dollars)
2004
ASSETS
------
Current Assets
Cash $ 26,964
-------------------------------------------------------------------------------------------------------------------
Total Assets $ 26,964
===================================================================================================================
LIABILITIES
-----------
Current Liabilities
Accounts payable $ 215
Accrued liabilities 16,300
Due to a related party (Note 5) 100
-------------------------------------------------------------------------------------------------------------------
Total Liabilities 16,615
-------------------------------------------------------------------------------------------------------------------
STOCKHOLDERS' EQUITY
--------------------
Common Stock
75,000,000 shares authorized, with a $0.001 par value,
7,500,000 shares issued and outstanding 7,500
Additional Paid in Capital 22,500
Donated Capital (Note 4) 7,000
-------------------------------------------------------------------------------------------------------------------
37,000
Deficit Accumulated During The Exploration Stage (26,651)
-------------------------------------------------------------------------------------------------------------------
Total Stockholders' Equity 10,349
-------------------------------------------------------------------------------------------------------------------
Total Liabilities and Stockholders' Equity $ 26,964
===================================================================================================================
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Commitment (Note 3)
The accompanying notes are an integral part of these financial statements
BOSS MINERALS, INC.
(An Exploration Stage Company)
STATEMENT OF OPERATIONS
(Expressed in US Dollars)
From
February 17, 2004
(Inception)
to September 30,
2004
----
Revenue $ -
-------------------------------------------------------------------------------------------------------------------
Expenses
Accounting and audit fees 3,300
Bank charges 136
Donated rent (Note 4) 1,750
Donated services (Note 4) 5,250
Incorporation costs 215
Legal and organizational costs 13,000
Mineral property costs 3,000
-------------------------------------------------------------------------------------------------------------------
Total Expenses 26,651
-------------------------------------------------------------------------------------------------------------------
Net Loss for the Period $ (26,651)
===================================================================================================================
Basic and Diluted Loss Per Share $ (0.01)
===================================================================================================================
Weighted Average Number of Shares Outstanding 4,946,000
===================================================================================================================
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The accompanying notes are an integral part of these financial statements
BOSS MINERALS, INC.
(An Exploration Stage Company)
STATEMENT OF CASH FLOWS
(Expressed in US Dollars)
From
February 17, 2004
(Inception) to
September 30,
2004
----
Operating Activities
Net loss for the period $ (26,651)
Adjustment to reconcile net loss to cash used in operating activities
Donated services and rent 7,000
Change in non-cash working capital balance related to operations
Accounts payable and accrued liabilities 16,515
------------------------------------------------------------------------------------------------------------------
Net Cash Used in Operating Activities (3,136)
------------------------------------------------------------------------------------------------------------------
Financing Activities
Capital stock issued 30,000
Advance from a related party 100
------------------------------------------------------------------------------------------------------------------
Net Cash from Financing Activities 30,100
------------------------------------------------------------------------------------------------------------------
Increase in Cash 26,964
Cash, Beginning of Period -
------------------------------------------------------------------------------------------------------------------
Cash, End of Period $ 26,964
==================================================================================================================
Non-cash Investing and Financing Activities -
==================================================================================================================
Supplemental Disclosure
Interest paid -
Income taxes paid -
|
The accompanying notes are an integral part of these financial statements
BOSS MINERALS, INC.
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
For the period from February 17, 2004 (Date of Inception) to September 30, 2004
(Expressed in US Dollars)
Deficit
Accumulated
Common Shares Additional During the
--------------------- Paid-in Donated Exploration
Number Par Value Capital Capital Stage Total
------ --------- ------- ------- ----- -----
Balance February 17, 2004 (Date of - $ - $ - $ - $ -
Inception) $ -
Capital stock issued for cash
- March, 2004 at $0.001 5,000,000 5,000 - - - 5,000
- July, 2004 at $0.01 1,400,000 1,400 12,600 - - 14,000
- August, 2004 at $0.01 1,100,000 1,100 9,900 - - 11,000
Donated services and rent - - - 7,000 - 7,000
Net loss for the period - - - - (26,651) (26,651)
----------------------------------------------------------------------------------------------------------------------------
Balance, September 30, 2004 7,500,000 $ 7,500 $ 22,500 $ 7,000 $ (26,651) $ 10,349
============================================================================================================================
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The accompanying notes are an integral part of these financial statements
BOSS MINERALS, INC.
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
September 30, 2004
(Expressed in US Dollars)
The Company was incorporated in the State of Nevada on February 17, 2004. The Company is an Exploration Stage Company as defined by Statement of Financial Accounting Standard ("SFAS") No. 7. The Company has acquired a mineral property located in the Province of British Columbia, Canada and has not yet determined whether this property contains reserves that are economically recoverable. The recoverability of amounts from the property will be dependent upon the discovery of economically recoverable reserves, confirmation of the Company's interest in the underlying property, the ability of the Company to obtain necessary financing to satisfy the expenditure requirements under the property agreement and to complete the development of the property and upon future profitable production or proceeds for the sale thereof.
These financial statements have been prepared on a going concern basis. The Company has incurred losses since inception resulting in an accumulated deficit of $26,651 since inception and further losses are anticipated in the development of its business raising substantial doubt about the Company's ability to continue as a going concern. Its ability to continue as a going concern is dependent upon the ability of the Company to generate profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due.
The Company is planning to file an SB-2 Registration Statement to register 2,500,000 shares of common stock for resale by existing shareholders of the Company with the United States Securities and Exchange Commission. The Company will not receive any proceeds from the resale of shares of common stock by the selling stockholders.
The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are expressed in US dollars. The Company's fiscal year end is September 30.
The Company has been in the exploration stage since its formation on February 17, 2004 and has not yet realized any revenues from its planned operations. It is primarily engaged in the acquisition and exploration of mining properties. Mineral property acquisition and exploration costs are charged to operations as incurred. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property, are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve.
BOSS MINERALS, INC.
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
September 30, 2004
(Expressed in US Dollars)
The preparation of financial statements in conformity with US generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
The Company's functional currency is the Canadian dollar. The financial statements of the Company are translated to United States dollars in accordance with SFAS No. 52 "Foreign Currency Translation". Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian dollars. The Company has not, to the date of these financials statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.
The carrying value of cash, accrued liabilities and due to related parties approximates their fair value because of the short-term maturity of these instruments. The Company's operations are in Canada and virtually all of its assets and liabilities are giving rise to significant exposure to market risks from changes in foreign currency rates. The financial risk is the risk to the Company's operations that arise from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk.
Environmental expenditures that relate to current operations are charged to operations or capitalized as appropriate. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation, are charged to operations. Liabilities are recorded when environmental assessments and/or remedial efforts are probable, and the cost can be reasonably estimated. Generally, the timing of these accruals coincides with the earlier of completion of a feasibility study or the Company's commitments to plan of action based on the then known facts.
BOSS MINERALS, INC.
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
September 30, 2004
(Expressed in US Dollars)
Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted SFAS No. 109 as of its inception. Pursuant to SFAS No. 109 the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.
The Company computes net income (loss) per share in accordance with SFAS No. 128, "Earnings per Share". SFAS No. 128 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive.
In December 2002, the Financial Accounting Standards Board issued
Financial Accounting Standard No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure" ("SFAS No. 148"), an
amendment of Financial Accounting Standard No. 123 "Accounting for
Stock-Based Compensation" ("SFAS No. 123"). The purpose of SFAS
No. 148 is to: (1) provide alternative methods of transition for
an entity that voluntarily changes to the fair value based method
of accounting for stock-based employee compensation, (2) amend the
disclosure provisions to require prominent disclosure about the
effects on reported net income of an entity's accounting policy
decisions with respect to stock-based employee compensation, and
(3) to require disclosure of those effects in interim financial
information. The disclosure provisions of SFAS No. 148 were
effective for the Company for the year ended September 30, 2004.
BOSS MINERALS, INC.
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
September 30, 2004
(Expressed in US Dollars)
The Company has elected to continue to account for stock-based employee compensation arrangements in accordance with the provisions of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees", ("APB No. 25") and comply with the disclosure provisions of SFAS No. 123 as amended by SFAS No. 148 as described above. In addition, in accordance with SFAS No. 123 the Company applies the fair value method using the Black-Scholes option-pricing model in accounting for options granted to consultants. Under APB No. 25, compensation expense for employees is recognized based on the difference, if any, on the date of grant between the estimated fair value of the Company's stock and the amount an employee must pay to acquire the stock. Compensation expense is recognized immediately for past services and pro-rata for future services over the option-vesting period. To September 30, 2004 the Company has not granted any stock options.
The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with SFAS No. 123 and the conclusions reached by the Emerging Issues Task Force in Issue No. 96-18. Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by EITF 96-18.
The Company has also adopted the provisions of the Financial Accounting Standards Board Interpretation No.44, Accounting for Certain Transactions Involving Stock Compensation - An Interpretation of APB Opinion No. 25 ("FIN 44"), which provides guidance as to certain applications of APB 25. FIN 44 is generally effective July 1, 2000 with the exception of certain events occurring after December 15, 1998.
SFAS No. 130, "Reporting Comprehensive Income," establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at September 30, 2004, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.
The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.
BOSS MINERALS, INC.
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
September 30, 2004
(Expressed in US Dollars)
Financial instruments that potentially subject the Company to credit risk consist principally of cash. Cash was deposited with a high quality credit institution.
Pursuant to a Mineral Property Option Agreement dated July 31, 2004, the Company was granted an option to acquire a 100% undivided right, title and interest in twenty mineral claim units, known as Mosquito King Property, located in the Kamloops Mining Division of British Columbia, Canada. To complete the option the Company must make cash payments of $33,000 as follows:
- $3,000 by August 25, 2004 (paid);
- an additional $5,000 by August 15, 2005; and
- an additional $25,000 by August 15, 2006.
The property will be subject to a 2% net smelter returns royalty.
a) The President provided a cash advance of $100 to the Company during the period ended September 30, 2004. This amount is unsecured, non-interest bearing and has no specific terms of repayment.
b) A private company controlled by the President of the Company provides accounting services to the Company. During the period ended September 30, 2004 the private company charged $300 for accounting services which were charged to operations.
c) The President provides management services and office premises to the Company. The services are valued at $750 per month and the office premises are valued at $250 per month. During the period ended September 30, 2004 donated services of $5,250 and donated rent expense of $1,750 were charged to operations.
d) The President is assisting in the preparation of the SB-2 Registration Statement. During the period ended September 30, 2004, the President charged $3,000 which was charged to operations.
Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has incurred net operating losses of $19,436 which commence expiring in 2024. Pursuant to SFAS No. 109 the Company is required to compute tax asset benefits for net operating losses carried forward.
BOSS MINERALS, INC.
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
September 30, 2004
(Expressed in US Dollars)
Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.
The components of the net deferred tax asset at September 30, 2004, and the statutory tax rate, the effective tax rate and the elected amount of the valuation allowance are indicated below:
2004
$
Net Operating Loss 19,436
Statutory Tax Rate 34%
Effective Tax Rate -
Deferred Tax Asset 6,608
Valuation Allowance (6,608)
------------------------------------------------------------------------------
Net Deferred Tax Asset -
==============================================================================
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Changes In And Disagreements With Accountants on Accounting and Financial Disclosure
We have had no changes in or disagreements with our accountants.
Until ______________, all dealers that effect transactions in these securities whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealer's 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
Our officers and directors are indemnified as provided by the Nevada Revised Statutes (the "NRS") and our bylaws.
Under the NRS, director immunity from liability to a company or its shareholders for monetary liabilities applies automatically unless it is specifically limited by a company's articles of incorporation that is not the case with our articles of incorporation. Excepted from that immunity are:
(1) a willful failure to deal fairly with the company or its shareholders in connection with a matter in which the director has a material conflict of interest;
(2) a violation of criminal law (unless the director had reasonable cause to believe that his or her conduct was lawful or no reasonable cause to believe that his or her conduct was unlawful);
(3) a transaction from which the director derived an improper personal profit; and
(4) willful misconduct.
Our bylaws provide that we will indemnify our directors and officers to the fullest extent not prohibited by Nevada law; provided, however, that we may modify the extent of such indemnification by individual contracts with our directors and officers; and, provided, further, that we shall not be required to indemnify any director or officer in connection with any proceeding (or part thereof) initiated by such person unless:
(1) such indemnification is expressly required to be made by law;
(2) the proceeding was authorized by our Board of Directors;
(3) such indemnification is provided by us, in our sole discretion, pursuant to the powers vested us under Nevada law; or
(4) such indemnification is required to be made pursuant to the bylaws.
Our bylaws provide that we will advance all expenses incurred to any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he is or was our director or officer, or is or was serving at our request as a director or executive officer of another company, partnership, joint venture, trust or other enterprise, prior to the final disposition of the proceeding, promptly following request. This advanced of expenses is to be made upon receipt of an undertaking by or on behalf of such person to repay said amounts should it be ultimately determined that the person was not entitled to be indemnified under our bylaws or otherwise.
Our bylaws also provide that no advance shall be made by us to any officer in any action, suit or proceeding, whether civil, criminal, administrative or investigative, if a determination is reasonably and promptly made: (a) by the board of directors by a majority vote of a quorum consisting of directors who were not parties to the proceeding; or (b) if such quorum is not obtainable, or, even if obtainable, a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, that the facts known to the decision- making party at the time such determination is made demonstrate clearly and convincingly that such person acted in bad faith or in a manner that such person did not believe to be in or not opposed to our best interests.
Other Expenses Of Issuance And Distribution
The estimated costs of this offering are as follows:
Securities and Exchange Commission registration fee $ 3.17
Transfer Agent fees $ 1,200.00
Accounting and auditing fees and expenses $ 4,000.00
Legal fees and expenses $ 5,000.00
Edgar filing fees $ 1,700.00
-----------
Total $ 11,903.17
===========
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All amounts are estimates other than the Commission's registration fee.
We are paying all expenses of the offering listed above. No portion of these expenses will be borne by the selling shareholders. The selling shareholders, however, will pay any other expenses incurred in selling their common stock, including any brokerage commissions or costs of sale.
Recent Sales Of Unregistered Securities
We completed an offering of 5,000,000 shares of our common stock at a price of $0.001 per share to a total of two purchasers on March 19, 2004. The total amount received from this offering was $5,000. Of these shares, 2,500,000 were sold to Mr. Andrei Krioukov and 2,500,000 were sold to Mr. Alexei Jirniaguine. Mr. Krioukov is our president, chief executive officer and a director. Mr. Jirniaguine is our secretary, treasurer and a director. These shares were issued pursuant to Regulation S of the Securities Act.
We completed an offering of 2,500,000 shares of our common stock at a price of $0.01 per share to a total of 25 purchasers on August 16, 2004. The total amount received from this offering was $25,000. We completed this offering pursuant to Regulation S of the Securities Act. The purchasers in this offering were as follows:
Name of Subscriber Number of Shares ------------------ ---------------- Kevin Booth 100,000 Shvonne Deptuck 100,000 Nick Twamley 100,000 Alvin Krishanna 100,000 Calvin Ng 100,000 Mirela Sivic 100,000 Fahimeh Shakeryroushan 100,000 Marcy Deptuck 100,000 Rika Collins 100,000 Jeremy Johnson 100,000 Nilgoun Shamsian 100,000 David Burns 100,000 Sonya Mandic 100,000 Arezon Setoudegan 100,000 Tatjana Mandic 100,000 Jelena Tintor 100,000 P.M.McElheron 100,000 Goran Tintor 100,000 Audrey McElheron 100,000 Doug Raphael 100,000 Monette McElheron 100,000 Kseniya Stepanova 100,000 Melanie Kumar 100,000 Heather Macpherson 100,000 Elizabeth-Anne Rogers 100,000 |
Regulation S Compliance
Each offer or sale was made in an offshore transaction;
Neither we, a distributor, any respective affiliates nor any person on behalf of any of the foregoing made any directed selling efforts in the United States;
Offering restrictions were, and are, implemented;
No offer or sale was made to a U.S. person or for the account or benefit of a U.S. person;
Each purchaser of the securities certifies that it was not a U.S. person and was not acquiring the securities for the account or benefit of any U.S. person;
Each purchaser of the securities agreed to resell such securities only in accordance with the provisions of Regulation S, pursuant to registration under the Act, or pursuant to an available exemption from registration; and agreed not to engage in hedging transactions with regard to such securities unless in compliance with the Act;
The securities contain a legend to the effect that transfer is prohibited except in accordance with the provisions of Regulation S, pursuant to registration under the Act, or pursuant to an available exemption from registration; and that hedging transactions involving those securities may not be conducted unless in compliance with the Act; and
We are required, either by contract or a provision in its bylaws, articles, charter or comparable document, to refuse to register any transfer of the securities not made in accordance with the provisions of Regulation S pursuant to registration under the Act, or pursuant to an available exemption from registration; provided, however, that if any law of any Canadian province prevents us from refusing to register securities transfers, other reasonable procedures, such as a legend described in paragraph (b)(3)(iii)(B)(3) of Regulation S have been implemented to prevent any transfer of the securities not made in accordance with the provisions of Regulation S.
Exhibits
Exhibit
Number Description
3.1 Articles of Incorporation
3.2 Bylaws
5.1 Legal opinion of Batcher & Zarcone, LLP, with consent to use
10.1 Mineral Property Option Agreement dated July 31, 2004
23.1 Consent of Manning Elliott, CA's
99.1 Location map
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The undersigned registrant hereby undertakes:
1. To file, during any period in which it offers or sells securities, a post-effective amendment to this registration statement to:
(a) include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(b) reflect in the prospectus any facts or events which, individually or
together, represent a fundamental change in the information set forth
in this registration statement; and notwithstanding the forgoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the commission pursuant to Rule 424(b) if, in
the aggregate, the changes in the volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration Statement; and
(c) 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, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment any of the securities being registered hereby which remain unsold at the termination of the offering.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the provisions above, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities, other than the payment by us of expenses incurred or paid by one of our directors, officers, or controlling persons in the successful defense of any action, suit or proceeding, is asserted by one of our directors, officers, or controlling person sin connection with the securities being registered, we will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification is against public policy as expressed in the Securities Act, and we will be governed by the final adjudication of such issue.
Signatures
In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form SB-2 and authorized this registration statement to be signed on its behalf by the undersigned, in the City of Vancouver, Province of British Columbia on November 22, 2004.
Boss Minerals, Inc.
By:/s/ Andrei Krioukov ------------------------------ Andrei Krioukov President, Chief Executive Officer, and Director |
In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates stated:
SIGNATURE CAPACITY IN WHICH SIGNED DATE
/s/ Andrei Krioukov President, Chief Executive November 22, 2004
----------------------- Officer, and Director
Andrei Krioukov
/s/ Alexei Jirniaguine Secretary, Treasurer
----------------------- principal accounting November 22, 2004
Alexei Jirniaguine officer, principal financial
officer and director
|
EXHIBIT 3.1 ARTICLES OF INCORPORATION
Articles of Incorporation
of
Boss Minerals,Inc.
First. The name of the corporation is Boss Minerals,Inc.
Second. The registered office of the corporation in the State of Nevada is located at 1802 N. Carson Street, Suite 212, Carson City, Nevada 89701. The corporation may maintain an office, or offices, in such other places within or without the State of Nevada as may be from time to time designated by the Board of Directors or the By-Laws of the corporation. The corporation may conduct all corporation business of every kind and nature outside the State of Nevada as well as within the State of Nevada.
Third. The objects for which this corporation is formed are to engage in any lawful activity, including, but not limited to the following:
a) Shall have such rights, privileges and powers as may be conferred upon
corporations by any existing law.
b) May at any time exercise such rights, privileges and powers, when not
inconsistent with the purposes and objects for which this corporation
is organized.
c) Shall have power to have succession by its corporate name for the
period limited in its certificate or articles of incorporation, and
when no period is limited, perpetually, or until dissolved and its
affairs wound up according to law.
d) Shall have power to sue and be sued in any court of law or equity.
e) Shall have power to make contracts.
f) Shall have power to hold, purchase and convey real and personal estate
and to mortgage or lease any such real and personal estate with its
franchises.The power to hold real and personal estate shall include the
power to take the same by devise or bequest in the State of Nevada, or
in any other state, territory or country.
g) Shall have power to appoint such officers and agents as the affairs of
the corporation shall require, and to allow them suitable compensation.
h) Shall have power to make By-Laws not inconsistent with the constitution
or laws of the United States, or of the State of Nevada, for the
management, regulation and government of its affairs and property, the
transfer of its stock, the transaction of its business, and the calling
and holding of meetings of its stockholders.
i) Shall have power to wind up and dissolve itself, or be wound up
or dissolved.
j) Shall have power to adopt and use a common seal or stamp, and alter the
same at pleasure. The use of a seal or stamp by the corporation on any
corporate documents is not necessary. The corporation may use a seal or
stamp, if it desires, but such use or nonuse shall not in any way
affect the legality of the document.
k) Shall have the power to borrow money and contract debts when necessary
for the transaction of its business, or for the exercise of its
corporate rights, privileges or franchises, or for any other lawful
purpose of its incorporation; to issue bonds, promissory notes, bills
of exchange, debentures, and other obligations and evidences of
indebtedness, payable at a specified time or times, or payable upon the
happening of a specified event or events, whether secured by mortgage,
pledge or otherwise, or unsecured, for money borrowed, or in payment
for property purchased, or acquired, or for any other lawful object.
1) Shall have power to guarantee, purchase, hold, sell, assign, transfer,
mortgage, pledge or otherwise dispose of the shares of the capital
stock of, or any bonds, securities or evidences of the indebtedness
created by, any other corporation or corporations of the State of
Nevada, or any other state or government, and, while owners of such
stock, bonds, securities or evidences of indebtedness, to exercise all
rights, powers and privileges of ownership, including the right to
vote, if any.
m) Shall have power to purchase, hold, sell and transfer shares of its own
capital stock, and use therefore its capital, capital surplus, surplus,
or other property to fund.
n) Shall have power to conduct business, have one or more offices, and
conduct any legal activity in the State of Nevada, and in any of the
several states, territories, possessions and dependencies of the
United States, the District of Columbia, and any foreign countries,
o) Shall have power to do all and everything necessary and proper for the
accomplishment of the objects enumerated in its certificate or articles
of incorporation, or any amendment thereof, or necessary or incidental
to the protection and benefit of the corporation, and, in general, to
carry on any lawful business necessary or incidental to the attainment
of the objects of the corporation, whether or not such business is
similar in nature to the objects set forth in the certificate or
articles of incorporation of the corporation,or any amendments thereof.
p) Shall have power to make donations for the public welfare or for
charitable, scientific or educational purposes.
q) Shall have power to enter into partnerships, general or limited, or
joint ventures, in connection with any lawful activities, as may be
allowed by law.
Fourth. That the total number of common stock authorized that may be issued by the Corporation is seventy-five million (75,000,000) shares of stock with a par value of one tenth of one cent ($0.001) per share and no other class of stock shall be authorized. Said shares may be issued by the corporation from time to time for such considerations as may be fixed by the Board of Directors.
Fifth. The governing board of the corporation shall be known as directors, and the number of directors may from time to time be increased or decreased in such
manner as shall be provided by the By-Laws of this corporation, providing that
the number of directors shall not be reduced to fewer than one (1).
The first Board of Directors shall be one (1) in number and the name
and post office address of the Director shall be listed as follows:
Name: Daniel A. Kramer
Address: 1802 N. Carson Street, Suite 212, Carson City, Nevada 89701
Sixth. The capital stock, after the amount of the subscription price, or par value, has been paid in, shall not be subject to assessment to pay the debts of the corporation.
Seventh. The name and post office address of the Incorporator signing the Articles of Incorporation is as follows:
Name: Daniel A. Kramer
Address: 1802 N. Carson Street, Suite 212, Carson City, Nevada 89701
Eighth.The Resident Agent for this corporation shall be VAL-U-CORP SERVICES,INC. The address of the Resident Agent, and, the registered or statutory address of this corporation in the State of Nevada, shall be: 1802 N. Carson Street, Suite 212, Carson City, Nevada 89701.
Ninth. The corporation is to have perpetual existence.
Tenth. In furtherance and not in limitation of the powers conferred by the statute, the Board of Directors is expressly authorized:
a) Subject to the By-Laws, if any, adopted by the Stockholders, to make,
alter or amend the By-Laws of the corporation.
b) To fix the amount to be reserved as working capital over and above
its capital stock paid in; to authorize and cause to be executed,
mortgages and liens upon the real and personal property of this
corporation.
c) By resolution passed by a majority of the whole Board, to designate one
(1) or more committees, each committee to consist of one or more of the
Directors of the corporation, which, to the extent provided in the
resolution, or in the By- Laws of the corporation, shall have and may
exercise the powers of the Board of Directors in the management of the
business and affairs of the corporation. Such committee, or committees,
shall have such name, or names as may be stated in the By-Laws of the
corporation, or as may be determined from time to time by resolution
adopted by the Board of Directors.
d) When and as authorized by the affirmative vote of the Stockholders
holding stock entitling them to exercise at least a majority of the
voting power given at a Stockholders meeting called for that purpose,
or when authorized by the written consent of the holders of at least a
majority of the voting stock issued and outstanding, the Board of
Directors shall have power and authority at any meeting to sell, lease
or exchange all of the property and assets of the corporation,
including its good will and its corporate franchises, upon such terms
and conditions as its Board of Directors deems expedient and for the
best interests of the corporation.
Eleventh. No shareholder shall be entitled as a matter of right to subscribe for or receive additional shares of any class of stock of the corporation, whether now or hereafter authorized, or any bonds, debentures or securities convertible into stock, but such additional shares of stock or other securities convertible into stock may be issued or disposed of by the Board of Directors to such persons and on such terms as in its discretion it shall deem advisable.
Twelfth. No Director or Officer of the corporation shall be personally liable to the corporation or any of its stockholders for damages for breach of fiduciary duty as a Director or Officer involving any act or omission of any such Director or Officer; provided, however, that the foregoing provision shall not eliminate or limit the liability of a Director or Officer (i) for acts or omissions which involve intentional misconduct, fraud or a knowing violation of the law, or (ii) the payment of dividends in violation of Section 78.300 of the Nevada Revised Statutes. Any repeal or modification of this Article by the Stockholders of the corporation shall be prospective only, and shall not adversely affect any limitations on the personal liability of a Director or Officer of the corporation for acts or omissions prior to such repeal or modification.
Thirteenth. This corporation reserves the right to amend, alter, change or repeal any provision contained in the Articles of Incorporation, in the manner now or hereafter prescribed by statute, or by the Articles of Incorporation, and all rights conferred upon Stockholders herein are granted subject to this reservation.
I, the undersigned, being the Incorporator hereinbefore named for the purpose of forming a corporation pursuant to General Corporation Law of the State of Nevada, do make and file these Articles of Incorporation, hereby declaring and certifying that the facts herein stated are true, and accordingly have hereunto set my hand this February 17, 2004.
/s/ Daniel A. Kramer
--------------------
Daniel A. Kramer
Incorporator
|
BYLAWS
of
BOSS MINERALS,INC.
(the "Corporation")
ARTICLE I: MEETINGS OF SHAREHOLDERS
The annual meeting of the shareholders of the Corporation shall be held at the time fixed, from time to time, by the Board of Directors.
Special meetings of the shareholders may be called by the Board of Directors or such person or persons authorized by the Board of Directors.
Meetings of shareholders shall be held at the registered office of the Corporation, or at such other places, within or without the State of Nevada as the Board of Directors may from time to time fix.
A notice convening an annual or special meeting which specifies the place, day, and hour of the meeting, and the general nature of the business of the meeting, must be faxed, personally delivered or mailed postage prepaid to each shareholder of the Corporation entitled to vote at the meeting at the address of the shareholder as it appears on the stock transfer ledger of the Corporation, at least ten (10) days prior to the meeting. Accidental omission to give notice of a meeting to, or the non-receipt of notice of a meeting by, a shareholder will not invalidate the proceedings at that meeting.
Unless otherwise provided by law, 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, without prior notice and without a vote if written consents are signed by shareholders representing a majority of the shares entitled to vote at such a meeting, except however, if a different proportion of voting power is required by law, the Articles of Incorporation or these Bylaws, than that proportion of written consents is required. Such written consents must be filed with the minutes of the proceedings of the shareholders of the Corporation.
a) No business, other than the election of the chairman or the adjournment of the meeting, will be transacted at an annual or special meeting unless a quorum of shareholders, entitled to attend and vote, is present at the commencement of the meeting, but the quorum need not be present throughout the meeting.
b) Except as otherwise provided in these Bylaws, a quorum is two persons present and being, or representing by proxy, shareholders of the Corporation.
c) If within half an hour from the time appointed for an annual or special meeting a quorum is not present, the meeting shall stand adjourned to a day, time and place as determined by the chairman of the meeting.
Subject to a special voting rights or restrictions attached to a class of shares, each shareholder shall be entitled to one vote for each share of stock in his or her own name on the books of the corporation, whether represented in person or by proxy.
No motion proposed at an annual or special meeting need be seconded.
In the case of an equality of votes, the chairman of the meeting at which the vote takes place is not entitled to have a casting vote in addition to the vote or votes to which he may be entitled as a shareholder of proxyholder.
In a dispute as to the admission or rejection of a vote at an annual or special meeting, the decision of the chairman made in good faith is conclusive.
a) Each shareholder entitled to vote at an annual or special meeting may do so either in person or by proxy. A form of proxy must be in writing under the hand of the appointor or of his or her attorney duly authorized in writing, or, if the appointor is a corporation, either under the seal of the corporation or under the hand of a duly authorized officer or attorney. A proxyholder need not be a shareholder of the Corporation.
b) A form of proxy and the power of attorney or other authority, if any, under which it is signed or a facsimiled copy thereof must be deposited at the registered office of the Corporation or at such other place as is specified for that purpose in the notice convening the meeting. In
addition to any other method of depositing proxies provided for in these Bylaws, the Directors may from time to time by resolution make regulations relating to the depositing of proxies at a place or places and fixing the time or times for depositing the proxies not exceeding 48 hours (excluding Saturdays, Sundays and holidays) preceding the meeting or adjourned meeting specified in the notice calling a meeting of shareholders.
ARTICLE II: BOARD OF DIRECTORS
a) The first Board of Directors of the Corporation, and all subsequent Boards of the Corporation, shall consist of not less than one (1) and not more than nine (9) directors. The number of Directors may be fixed and changed from time to time by ordinary resolution of the shareholders of the Corporation.
b) The first Board of Directors shall hold office until the first annual meeting of shareholders and until their successors have been duly elected and qualified or until there is a decrease in the number of directors. Thereinafter, Directors will be elected at the annual meeting of shareholders and shall hold office until the annual meeting of the shareholders next succeeding his or her election, or until his or her prior death, resignation or removal. Any Director may resign at any time upon written notice of such resignation to the Corporation.
c) A casual vacancy occurring in the Board may be filled by the remaining Directors.
d) Between successive annual meetings, the Directors have the power to appoint one or more additional Directors but not more than 1/2 of the number of Directors fixed at the last shareholder meeting at which Directors were elected. A Director so appointed holds office only until the next following annual meeting of the Corporation, but is eligible for election at that meeting. So long as he or she is an additional Director, the number of Directors will be increased accordingly.
e) A Director is not required to hold a share in the capital of the Corporation as qualification for his or her office.
a) The Board of Directors shall be responsible for the control and management of the business and affairs, property and interests of the Corporation, and may exercise all powers of the Corporation, except for those powers conferred upon or reserved for the shareholders or any other persons as required under Nevada state law, the Corporation's Articles of Incorporation or by these Bylaws.
b) The remuneration of the Directors may from time to time be determined by the Directors or, if the Directors decide, by the shareholders.
a) The President of the Corporation shall preside as chairman at every meeting of the Directors, or if the President is not present or is willing to act as chairman, the Directors present shall choose one of their number to be chairman of the meeting.
b) The Directors may meet together for the dispatch of business, and adjourn and otherwise regulate their meetings as they think fit. Questions arising at a meeting must be decided by a majority of votes. In case of an equality of votes the chairman does not have a second or casting vote. Meetings of the Board held at regular intervals may be held at the place and time upon the notice (if any) as the Board may by resolution from time to time determine.
c) A Director may participate in a meeting of the Board or of a committee of the Directors using conference telephones or other communications facilities by which all Directors participating in the meeting can hear each other and provided that all such Directors agree to such participation. A Director participating in a meeting in accordance with this Bylaw is deemed to be present at the meeting and to have so agreed. Such Director will be counted in the quorum and entitled to speak and vote at the meeting.
d) A Director may, and the Secretary on request of a Director shall, call a meeting of the Board. Reasonable notice of the meeting specifying the place, day and hour of the meeting must be given by mail, postage prepaid, addressed to each of the Directors and alternate Directors at his or her address as it appears on the books of the Corporation or by leaving it at his or her usual business or residential address or by telephone, facsimile or other method of transmitting legibly recorded messages. It is not necessary to give notice of a meeting of Directors to a Director immediately following a shareholder meeting at which the Director has been elected, or is the meeting of Directors at which the Director is appointed.
e) A Director of the Corporation may file with the Secretary a document executed by him waiving notice of a past, present or future meeting or meetings of the Directors being, or required to have been, sent to him and may at any time withdraw the waiver with respect to meetings held thereafter. After filing such waiver with respect to future meetings and until the waiver is withdrawn no notice of a meeting of Directors need be given to the Director. All meetings of the Directors so held will be deemed not to be improperly called or constituted by reason of notice not having been given to the Director.
f) The quorum necessary for the transaction of the business of the Directors may be fixed by the Directors and if not so fixed is a majority of the Directors or, if the number of Directors is fixed at one, is one Director.
g) The continuing Directors may act notwithstanding a vacancy in their body but, if and so long as their number is reduced below the number fixed pursuant to these Bylaws as the necessary quorum of Directors, the continuing Directors may act for the purpose of increasing the number of Directors to that number, or of summoning a shareholder meeting of the Corporation, but for no other purpose.
h) All acts done by a meeting of the Directors, a committee of Directors, or a person acting as a Director, will, notwithstanding that it be afterwards discovered that there was some defect in the qualification, election or appointment of the Directors, shareholders of the committee or person acting as a Director, or that any of them were disqualified, be as valid as if the person had been duly elected or appointed and was qualified to be a Director.
i) A resolution consented to in writing, whether by facsimile or other method of transmitting legibly recorded messages, by all of the Directors is as valid as if it had been passed at a meeting of the Directors duly called and held. A resolution may be in two or more counterparts which together are deemed to constitute one resolution in writing. A resolution must be filed with the minutes of the proceedings of the directors and is effective on the date stated on it or on the latest date stated on a counterpart.
j) All Directors of the Corporation shall have equal voting power.
One or more or all the Directors of the Corporation may be removed with or without cause at any time by a vote of two-thirds of the shareholders entitled to vote thereon, at a special meeting of the shareholders called for that purpose.
a) The Directors may from time to time by resolution designate from among its members one or more committees, and alternate members thereof, as they deem desirable, each consisting of one or more members, with such powers and authority (to the extent permitted by law and these Bylaws) as may be provided in such resolution. Each such committee shall serve at the pleasure of the Board of Directors and unless otherwise stated by law, the Certificate of Incorporation of the Corporation or these Bylaws, shall be governed by the rules and regulations stated herein regarding the Board of Directors.
b) Each Committee shall keep regular minutes of its transactions, shall cause them to be recorded in the books kept for that purpose, and shall report them to the Board at such times as the Board may from time to time require. The Board has the power at any time to revoke or override the authority given to or acts done by any Committee.
ARTICLE III: OFFICERS
a) The Corporation's officers shall have such titles and duties as shall be stated in these Bylaws or in a resolution of the Board of Directors which is not inconsistent with these Bylaws. The officers of the Corporation shall consist of a president, secretary, treasurer, and also may have one or more vice presidents, assistant secretaries and assistant treasurers and such other officers as the Board of Directors may from time to time deem advisable. Any officer may hold two or more offices in the Corporation, and may or may not also act as a Director.
b) The officers of the Corporation shall be elected by the Board of Directors at the regular annual meeting of the Board following the annual meeting of shareholders.
c) Each officer shall hold office until the annual meeting of the Board of Directors next succeeding his or her election, and until his or her successor shall have been duly elected and qualified, subject to earlier termination by his or her death, resignation or removal.
Any officer may resign at any time by giving written notice of such resignation to the Corporation.
Any officer appointed by the Board of Directors may be removed by a majority vote of the Board, either with or without cause, and a successor appointed by the Board at any time, and any officer or assistant officer, if appointed by another officer, may likewise be removed by such officer.
The remuneration of the Officers of the Corporation may from time to time be determined by the Directors or, if the Directors decide, by the shareholders.
Each officer of the Corporation who holds another office or possesses property whereby, whether directly or indirectly, duties or interests might be created in conflict with his or her duties or interests as an officer of the Corporation shall, in writing, disclose to the President the fact and the nature, character and extent of the conflict and abstain from voting with respect to any resolution in which the officer has a personal interest.
ARTICLE V: SHARES OF STOCK
Section 1 - Certificate of Stock
a) The shares of the Corporation shall be represented by certificates or shall be uncertificated shares.
b) Certificated shares of the Corporation shall be signed, either manually or by facsimile, by officers or agents designated by the Corporation for such purposes, and shall certify the number of shares owned by the shareholder in the Corporation. Whenever any certificate is countersigned or otherwise authenticated by a transfer agent or transfer clerk, and by a registrar, then a facsimile of the signatures of the officers or agents, the transfer agent or transfer clerk or the registrar of the Corporation may be printed or lithographed upon the certificate in lieu of the actual signatures. If the Corporation uses facsimile signatures of its officers and agents on its stock certificates, it cannot act as registrar of its own stock, but its
transfer agent and registrar may be identical if the institution acting in those dual capacities countersigns or otherwise authenticates any stock certificates in both capacities. If any officer who has signed or whose facsimile signature has been placed upon such certificate, shall have ceased to be such officer before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer at the date of its issue.
c) If the Corporation issued uncertificated shares as provided for in these Bylaws, within a reasonable time after the issuance or transfer of such uncertificated shares, and at least annually thereafter, the Corporation shall send the shareholder a written statement certifying the number of shares owned by such shareholder in the Corporation.
d) Except as otherwise provided by law, the rights and obligations of the holders of uncertificated shares and the rights and obligations of the holders of certificates representing shares of the same class and series shall be identical.
e) If a share certificate:
(i) is worn out or defaced, the Directors shall, upon production to them of the certificate and upon such other terms, if any, as they may think fit, order the certificate to be cancelled and issue a new certificate;
(ii) is lost, stolen or destroyed, then upon proof being given to the satisfaction of the Directors and upon and indemnity, if any being given, as the Directors think adequate, the Directors shall issue a new certificate; or
(iii) represents more than one share and the registered owner surrenders it to the Corporation with a written request that the Corporation issue in his or her name two or more certificates, each representing a specified number of shares and in the aggregate representing the same number of shares as the certificate so surrendered, the Corporation shall cancel the certificate so surrendered and issue new certificates in accordance with such request.
a) Transfers or registration of transfers of shares of the Corporation shall be made on the stock transfer books of the Corporation by the registered holder thereof, or by his or her attorney duly authorized by a written power of attorney; and in the case of shares represented by certificates, only after the surrender to the Corporation of the certificates representing such shares with such shares properly endorsed, with such evidence of the authenticity of such endorsement, transfer, authorization and other matters as the Corporation may reasonably require, and the payment of all stock transfer taxes due thereon.
b) The Corporation shall be entitled to treat the holder of record of any share or shares 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 share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by law.
a) The Directors may fix in advance a date, which must not be more than 60 days permitted by the preceding the date of a meeting of shareholders or a class of shareholders, or of the payment of a dividend or of the proposed taking of any other proper action requiring the determination of shareholders as the record date for the determination of the shareholders entitled to notice of, or to attend and vote at, a meeting and an adjournment of the meeting, or entitled to receive payment of a dividend or for any other proper purpose and, in such case, notwithstanding anything in these Bylaws, only shareholders of records on the date so fixed will be deemed to be the shareholders for the purposes of this Bylaw.
b) Where no record date is so fixed for the determination of shareholders as provided in the preceding Bylaw, the date on which the notice is mailed or on which the resolution declaring the dividend is adopted, as the case may be, is the record date for such determination.
Notwithstanding anything else in these Bylaws, the Corporation, if the Directors so resolve, will not be required to issue fractional shares in connection with an amalgamation, consolidation, exchange or conversion. At the discretion of the Directors, fractional interests in shares may be rounded to the nearest whole number, with fractions of 1/2 being rounded to the next highest whole number, or may be purchased for cancellation by the Corporation for such consideration as the Directors determine. The Directors may determine the manner in which fractional interests in shares are to be transferred and delivered to the Corporation in exchange for consideration and a determination so made is binding upon all shareholders of the Corporation. In case shareholders having fractional interests in shares fail to deliver them to the Corporation in accordance with a determination made by the Directors, the Corporation may deposit with the Corporation's Registrar and Transfer Agent a sum sufficient to pay the consideration payable by the Corporation for the fractional interests in shares, such deposit to be set aside in trust for such shareholders. Such setting aside is deemed to be payment to such shareholders for the fractional interests in shares not so delivered which will thereupon not be considered as outstanding and such shareholders will not be considered to be shareholders of the Corporation with respect thereto and will have no right except to receive payment of the money so set aside and deposited upon delivery of the certificates for the shares held prior to the amalgamation, consolidation, exchange or conversion which result in fractional interests in shares.
ARTICLE VI: DIVIDENDS
a) Dividends may be declared and paid out of any funds available therefor, as often, in such amounts, and at such time or times as the Board of Directors may determine and shares may be issued pro rata and without consideration to the Corporation's shareholders or to the shareholders of one or more classes or series.
b) Shares of one class or series may not be issued as a share dividend to shareholders of another class or series unless such issuance is in accordance with the Articles of Incorporation and:
(i) a majority of the current shareholders of the class or series to be
issued approve the issue; or
(ii) there are no outstanding shares of the class or series of shares
that are authorized to be issued as a dividend.
ARTICLE VII: BORROWING POWERS
a) The Directors may from time to time on behalf of the Corporation:
(i) borrow money in such manner and amount, on such security, from such sources and upon such terms and conditions as they think fit,
(ii) issue bonds, debentures and other debt obligations either outright or as security for liability or obligation of the Corporation or another person, and
(iii) mortgage, charge, whether by way of specific or floating charge, and give other security on the undertaking, or on the whole or a part of the property and assets of the Corporation (both present and future).
b) A bond, debenture or other debt obligation of the Corporation may be issued at a discount, premium or otherwise, and with a special privilege as to redemption, surrender, drawing, allotment of or conversion into or exchange for shares or other securities, attending and voting at shareholder meetings of the Corporation, appointment of Directors or otherwise, and may by its terms be assignable free from equities between the Corporation and the person to whom it was issued or a subsequent holder thereof, all as the Directors may determine.
ARTICLE VIII: FISCAL YEAR
The fiscal year end of the Corporation shall be fixed, and shall be subject to change, by the Board of Directors from time to time, subject to applicable law.
ARTICLE IX: CORPORATE SEAL
The corporate seal, if any, shall be in such form as shall be prescribed and altered, from time to time, by the Board of Directors. The use of a seal or stamp by the Corporation on corporate documents is not necessary and the lack thereof shall not in any way affect the legality of a corporate document.
ARTICLE X: AMENDMENTS
All Bylaws of the Corporation shall be subject to alteration or repeal, and new Bylaws may be made by a majority vote of the shareholders at any annual meeting or special meeting called for that purpose.
The Board of Directors shall have the power to make, adopt, alter, amend and repeal, from time to time, Bylaws of the Corporation.
ARTICLE XI: DISCLOSURE OF INTEREST OF DIRECTORS
a) A Director who is, in any way, directly or indirectly interested in an existing or proposed contract or transaction with the Corporation or who holds an office or possesses property whereby, directly or indirectly, a duty or interest might be created to conflict with his or her duty or interest as a Director, shall declare the nature and extent of his or her interest in such contract or transaction or of the conflict with his or her duty and interest as a Director, as the case may be.
b) A Director shall not vote in respect of a contract or transaction with the Corporation in which he is interested and if he does so his or her vote will not be counted, but he will be counted in the quorum present at the meeting at which the vote is taken. The foregoing prohibitions do not apply to:
(i) a contract or transaction relating to a loan to the Corporation, which a Director or a specified corporation or a specified firm in which he has an interest has guaranteed or joined in guaranteeing the repayment of the loan or part of the loan;
(ii) a contract or transaction made or to be made with or for the benefit of a holding corporation or a subsidiary corporation of which a Director is a director or officer;
(iii) a contract by a Director to subscribe for or underwrite shares or debentures to be issued by the Corporation or a subsidiary of the Corporation, or a contract, arrangement or transaction in which a Director is directly or indirectly interested if all the other Directors are also directly or indirectly interested in the contract, arrangement or transaction;
(iv) determining the remuneration of the Directors;
(v) purchasing and maintaining insurance to cover Directors against liability incurred by them as Directors; or
(vi) the indemnification of a Director by the Corporation.
c) A Director may hold an office or place of profit with the Corporation (other than the office of Auditor of the Corporation) in conjunction with his or her office of Director for the period and on the terms (as to remuneration or otherwise) as the Directors may determine. No Director or intended Director will be disqualified by his or her office from contracting with the Corporation
either with regard to the tenure of any such other office or place of profit, or as vendor, purchaser or otherwise, and, no contract or transaction entered into by or on behalf of the Corporation in which a Director is interested is liable to be voided by reason thereof.
d) A Director or his or her firm may act in a professional capacity for the Corporation (except as Auditor of the Corporation), and he or his or her firm is entitled to remuneration for professional services as if he were not a Director.
e) A Director may be or become a director or other officer or employee of, or otherwise interested in, a corporation or firm in which the Corporation may be interested as a shareholder or otherwise, and the Director is not accountable to the Corporation for remuneration or other benefits received by him as director, officer or employee of, or from his or her interest in, the other corporation or firm, unless the shareholders otherwise direct.
ARTICLE XII: ANNUAL LIST OF OFFICERS, DIRECTORS AND REGISTERED AGENT
The Corporation shall, within sixty days after the filing of its Articles of Incorporation with the Secretary of State, and annually thereafter on or before the last day of the month in which the anniversary date of incorporation occurs each year, file with the Secretary of State a list of its president, secretary and treasurer and all of its Directors, along with the post office box or street address, either residence or business, and a designation of its resident agent in the state of Nevada. Such list shall be certified by an officer of the Corporation.
ARTICLE XIII: INDEMNITY OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS
a) The Directors shall cause the Corporation to indemnify a Director or former Director of the Corporation and the Directors may cause the Corporation to indemnify a director or former director of a corporation of which the Corporation is or was a shareholder and the heirs and personal representatives of any such person against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, actually and reasonably incurred by him or them including an amount paid to settle an action or satisfy a judgment inactive criminal or administrative action or proceeding to which he is or they are made a party by reason of his or her being or having been a Director of the Corporation or a director of such corporation, including an action brought by the Corporation or corporation. Each Director of the Corporation on being elected or appointed is deemed to have contracted with the Corporation on the terms of the foregoing indemnity.
b) The Directors may cause the Corporation to indemnify an officer, employee or agent of the Corporation or of a corporation of which the Corporation is or was a shareholder (notwithstanding that he is also a Director), and his or her heirs and personal representatives against all costs, charges and expenses incurred by him or them and resulting from his or her acting as an officer, employee or agent of the Corporation or corporation. In addition the Corporation shall indemnify the Secretary or an Assistance Secretary of the Corporation (if he is not a full time employee of the Corporation and notwithstanding that he is also a Director), and his or her respective heirs and legal representatives against
all costs, charges and expenses incurred by him or them and arising out of the functions assigned to the Secretary by the Corporation Act or these Articles and each such Secretary and Assistant Secretary, on being appointed is deemed to have contracted with the Corporation on the terms of the foregoing indemnity.
c) The Directors may cause the Corporation to purchase and maintain insurance for the benefit of a person who is or was serving as a Director, officer, employee or agent of the Corporation or as a director, officer, employee or agent of a corporation of which the Corporation is or was a shareholder and his or her heirs or personal representatives against a liability incurred by him as a Director, officer, employee or agent.
CERTIFIED TO BE THE BYLAWS OF:
BOSS MINERALS,INC.
per:
/s/ Alexei Jirniaguine ----------------------------- Alexei Jirniaguine, Secretary |
Batcher & Zarcone, LLP 4190 Bonita Road, Suite 205 Bonita, CA 91902 (619) 788-7881
November 19, 2004
U.S. Securities and Exchange Commission
450 Fifth Avenue, NW
Washington, DC 20549
Re: Registration Statement on Form SB-2 (the "Registration Statement") Boss Minerals, Inc., a Nevada Corporation (the "Company")
Gentlemen:
I have acted as special counsel for the Company for the limited purpose of rendering this opinion in connection with the registration (pursuant to the Registration Statement) of 2,500,000 shares (the "Shares") of the common stock, par value $0.001 per share of the Company. I was not engaged to prepare or review, and I have not prepared or reviewed, any portion of the Registration Statement. I express no opinion as to the accuracy or adequacy of the disclosure contained in the Registration Statement, and I hereby disclaim any responsibility for the content of the Registration Statement.
In my capacity as special counsel to the Company, I 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. By-Laws of the Company, as amended to date;
3. The records of corporate proceedings relating to the issuance of the Shares, and;
4. Such other instruments and documents as I have believed necessary for the purpose of rendering the following opinion.
In such examinations, I 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, I 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 I have believed necessary and relevant.
Based on the foregoing, and having due regard for such legal considerations as I believe relevant, I am of the opinion that, under applicable law of the State of Nevada (including without limitation, the statutory provisions, all applicable
provisions of the Nevada constitution and reported judicial decisions interpreting those laws), the Shares were duly authorized by all necessary corporate action on the part of the Company, legally and validly issued, fully paid and non-assessable. I am also of the opinion that the Shares, when sold after the effectiveness of the Registration Statement, will be validly issued, fully paid and non-assessable.
I hereby consent to the filing of this opinion with the U.S. Securities and Exchange Commission as Exhibit 5.1 to the Registration Statement.
Sincerely,
BATCHER & ZARCONE, LLP
Karen A. Batcher, Esq.
Cc: client
MINERAL PROPERTY OPTION AGREEMENT
THIS AGREEMENT dated for reference July 31, 2004.
BETWEEN:
RICH RIVER EXPLORATION LTD., a company incorporated pursuant to the laws of British Columbia with an address at PO Box 131, Grindrod, British Columbia, V0E 1Y0;
CRAIG A. LYNES, of PO Box 131, Grindrod, British Columbia,
V0E 1Y0;
(the "Optionors")
OF THE FIRST PART
AND:
BOSS MINERALS, INC., a company incorporated pursuant to the laws of the State of Nevada and having its head office at 400 - 318 Homer Street, Vancouver, British Columbia, V6B 2V2;
("Boss")
OF THE SECOND PART
W H E R E A S :
A. Craig A. Lynes is the registered and Rich River Exploration Ltd. is the beneficial owner of a mineral property claim group comprising approximately 500 hectares located in the Kamloops Mining Division, British Columbia, known as the Mosquito King property, which claims are more particularly described in Schedule "A" attached hereto which forms a material part hereof (collectively, the "Claims");
B. The Optionors have agreed to grant to Boss 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. OPTIONORS' REPRESENTATIONS
1.1 The Optionors represent and warrant to Boss that:
(a) Collectively, the Optionors are the registered and beneficial
owners of the Claims and hold the right to explore and develop
the Claims;
(b) The Optionors hold the Claims free and clear of all liens,
charges and claims of others, and the Optionors have 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
Optionors' ownership of or title to any of the Claims nor to
the knowledge of the Optionors is there any basis therefor,
and there are no outstanding agreements or options to acquire
or purchase the Claims or any portion thereof;
(e) The Optionors have 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 each of the Optionors is
unaware of any basis for, the institution of any proceedings
which could lead to the placing of either Optionor in
bankruptcy, or in any position similar to bankruptcy.
|
1.2 The representations and warranties of the Optionors set out in paragraph 1.1 above form a part of this Agreement and are conditions upon which Boss has relied in entering into this Agreement and shall survive the acquisition of any interest in the Claims by Boss.
2. BOSS'S REPRESENTATIONS
Boss warrants and represents to the Optionors 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 Optionors hereby give and grant to Boss 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 Optionors, 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 Boss in respect of the Claims in good standing and in force and effect, Boss shall be obligated to:
(a) Pay to the Optionors a total of $33,000 in the following manner:
(i) $3,000 by August 25, 2004;
(ii) an additional $5,000 by August 15, 2005; and
(iii) an additional $25,000 by August 15, 2006;
(b) Pay, or cause to be paid, to the Optionors, or on the Optionors' behalf as Boss 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.
4.2 Area of Influence. For the purpose of this Agreement, the area covered by the Claims shall include an area of influence surrounding the outer perimeter of the Claims to a maximum of three kilometres (the "Area of Influence") and all mineral concessions, interests or rights acquired, directly or indirectly, within the Area of Influence before or after the date of signing of this Agreement by the Optionors or Boss during the currency of this Agreement shall become part of this Agreement.
5. COVENANTS OF BOSS
5.1 Boss 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 Boss, in its sole discretion, determine that any part of the Claims no longer warrants further exploration and development, then Boss may abandon such interest or interests without affecting its rights or obligations under this Agreement, so long as Boss provides the Optionors with 30 days notice of its intention to do so. Upon receipt of such notice, the Optionors may request Boss to retransfer the title to such interest or interests to them, and Boss 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 Boss 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 Boss shall be in default of any requirement set forth in paragraph 4.1 herein, the Optionors shall give written notice to Boss specifying the default and Boss shall not lose any rights granted under this Agreement, unless within 30 days after the giving of notice of default by the Optionors, Boss 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, Boss shall have no interest in or to the Claims, and all expenditures and payments made by Boss to or on behalf of the Optionors under this Agreement shall be non-refundable by the Optionors for which Boss shall have no recourse.
8. ACQUISITION OF INTERESTS IN THE PROPERTY
At such time as Boss 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 Boss, and Boss 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 Optionors.
9. RIGHT OF ENTRY
For so long as the Option continues in full force and effect, Boss, 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 Boss may consider advisable; and
(d) remove from the Claims and sell or otherwise dispose of mineral products.
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 Boss commences commercial production on the Claims, the Optionors shall be entitled to receive and Boss shall pay to the Optionors 2% of net smelter returns, to a maximum of $500,000.
10.4 Boss shall be under no obligation whatsoever to place the Claims into commercial production and in the event they are placed into commercial production, Boss 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 Optionors 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 Optionors 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 Optionors 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 Boss which are relevant to the determination of net smelter returns, and, at the expense of the Optionors, to make copies thereof.
11. OPERATOR
After the execution of this Agreement, Boss, or at Boss'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. Boss, if operator, may resign as the operator at any time by giving 30 calendar days prior written notice to the Optionors, and within such 30 day period, Boss may appoint another party who covenants to act as the operator of the Claims upon such terms as Boss 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 Boss, the Optionors shall assist Boss to record this Agreement with the appropriate mining recorder and, when required, the Optionors shall further provide Boss with such recordable documents as Boss 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 Boss 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 Boss, 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 Boss, insofar as is possible, shall promptly give written notice to the Optionors 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 Optionors as soon as such cause ceases to exist.
16. CONFIDENTIAL INFORMATION
No information furnished by Boss to the Optionors hereunder in respect of the activities carried out on the Claims by Boss, or related to the sale of mineral products derived from the Claims, shall be published by the Optionors without the prior written consent of Boss, 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 Optionors addressed to them as follows:
Rich River Exploration Ltd.
Craig A. Lynes
Box 131
Grindrod, British Columbia
V0E 1Y0
and in the case of Boss addressed as follows:
Boss Minerals, Inc..
Suite 400 - 318 Homer Street
Vancouver, British Columbia
V6B 2V2
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 Boss to do any acts or make any payments hereunder and any acts or payments made hereunder shall not be construed as obligating Boss 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.
RICH RIVER EXPLORATION LTD. BOSS MINERALS, INC.
per: By:/s/ Andrei Krioukov
---------------------- -------------------------
Authorized Signatory Andrei Krioukov
Authorized Signatory
By: /s/ Craig A. Lynes
----------------------
Craig A. Lynes
|
TO THAT CERTAIN AGREEMENT MADE AS OF JULY 31, 2004
BETWEEN RICH RIVER EXPLORATION LTD.,
CRAIG A. LYNES AND BOSS MINERALS, INC.
The o mineral claims that constitute the Mosquito King claims are located in the Kamloops Mining Division, Province on British Columbia on Map Sheet 082M003. Specifics of the claims are as follows:
EXHIBIT 23.1
[LOGO]
MANNINNG ELLIOTT 11th floor, 1050 West Pender Street, Vancouver, BC,Canada V6E 3S7
CHARTERED ACCOUNTANTS Phone: 604.714.3600 Fax:604.714.3669
Web: manningelliott.com
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Interests Of Named Experts And Counsel" and to the use of our report dated October 14, 2004, in the Registration Statement (Form SB-2) and related Prospectus of Boss Minerals, Inc. for the registration of shares of its common stock.
/s/ "Manning Elliott" MANNING ELLIOTT |
CHARTERED ACCOUNTANTS
Vancouver, Canada
November 22, 2004
See attached PDF