SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-KSB

(Mark One)

|ý | Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ------------------------------------------------------------------------------------

|o | Transitional Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended December 31, 2001

Commission File No.001-31242

NAVIGATOR VENTURES, INC.(Name of small business issuer in its charter)

Nevada(State or other jurisdiction of Incorporation or Organization)

98-0232855(I.R.S. Employer Identification Number)


207-1425 Marine Drive
West Vancouver, B.C.
V7T 1B9
(604) 818-6804(Address, including zip code and telephone number, including area
code, of registrant's executive offices)

Securities
registered under Section 12(b) of the Exchange Act:
none

Securities
registered under Section 12(g) of the Exchange Act:Common Stock
(Title of class)

Check
whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the Company was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes ý    No o

Check
if disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of
registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this
Form 10-KSB.

Issuer's
revenues for its most recent fiscal year: $0.00.

(Continued
on Following Page)

---

State
the aggregate market value of the voting stock held by non-affiliates, computed by reference to the price at which the stock was sold, or the average bid and asked
prices of such stock, as of a specified date within the past 60 days: As of April 3, 2002 $100,000.

State
the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: As of April 3, 2002 there were 2,250,000 shares of the
Company's common stock issued and outstanding.

Documents
Incorporated by Reference: Three

This
Form 10-KSB consists of Twenty-one Pages

Exhibit
Index is located at Page Twelve

---

TABLE OF CONTENTS        FORM 10-KSB ANNUAL REPORT        NAVIGATOR VENTURES, INC.

|            |  |                                                                                                                 |  | PAGE   
|----------- |  | --------------------------------------------------------------------------------------------------------------- |  | -------
|Facing Page |  |                                                                                                                
|Index       |  |                                                                                                                 |  |        
|PART I      |  |                                                                                                                 |  |        
|Item 1.     |  | Description of Business                                                                                         |  | 1      
|Item 2.     |  | Description of Property                                                                                         |  | 5      
|Item 3.     |  | Legal Proceedings                                                                                               |  | 5      
|Item 4.     |  | Submission of Matters to a Vote of Security Holders                                                             |  | 5      
|PART II     |  |                                                                                                                 |  |        
|Item 5.     |  | Market for the Registrant's Common Equity and Related Stockholder Matters                                       |  | 5      
|Item 6.     |  | Management's Discussion and Analysis of Financial Condition and Results of Operations                           |  | 5      
|Item 7      |  | Financial Statements                                                                                            |  | F-1-F-9
|Item 8.     |  | Changes in and Disagreements on Accounting and Financial Disclosure                                             |  | 9      
|PART III    |  |                                                                                                                 |  |        
|Item 9.     |  | Directors, Executive Officers, Promoters and Control Persons, Compliance with Section 16(a) of the Exchange Act |  | 9      
|Item 10.    |  | Executive Compensation                                                                                          |  | 9      
|Item 11.    |  | Security Ownership of Certain Beneficial Owners and Management                                                  |  | 10     
|Item 12.    |  | Certain Relationships and Related Transactions                                                                  |  | 10     
|PART IV     |  |                                                                                                                 |  |        
|Item 13.    |  | Exhibits and Reports on Form 8-K                                                                                |  | 10     
|SIGNATURES  |  | 11                                                                                                             

---



PART I

ITEM 1. DESCRIPTION OF BUSINESS.

History

Navigator Ventures, Inc. was incorporated under the laws of the State of Nevada on May 24, 2000. We have not commenced active business operations.

We
are an exploration stage company. We have acquired a mineral lease on a total of 5 patented and 10 unpatented lode mineral claims located in Washington State. A patented lode mineral
claim is the highest form of holding a mineral claim. It means that no more assessment work is necessary and that all mineral rights, both surface and underground, are included in the claim. An
unpatented claim means that more assessment work is necessary before all mineral rights can be cliamed. We intend to explore for metals, including silver and gold, on our property. There is no
assurance that valuable minerals will be found until proper geologic exploration and analysis is performed.

Our
administrative office is located at 207-1425 Marine Drive, West Vancouver, British Columbia, Canada V7T 1B9, telephone (604) 818-6804. Our
Nevada office is located at 5300 West Sahara Avenue, Suite 101, Las Vegas, Nevada, 89146. Our fiscal year end is December 31.

Business

On September 30, 2000, Navigator acquired a 10 year mineral lease from L.E. Lawson, the owner of five patented and ten unpatented lode mineral
claims, sometimes referred to as the Zala M claims, covering approximately 277 acres located in the northeast section of the state of Washington. An unpatented claim is one in which more assessment
work is necessary before all mineral rights can be claimed. We are presently in the pre-exploration stage and there is no assurance that a commercially viable mineral deposit exists in our
property until exploration is done and a comprehensive evaluation concludes economic and legal feasibility.

Under
the terms of the mineral lease, Navigator may extend the initial term for two additional periods of ten years each by giving the owner notice of such extension not less than thirty
days prior to the expiration of the initial term or any extension thereof. Navigator has the exclusive possession of the property for mining purposes during the term of the lease.

If
Navigator fails to comply with any of the provisions of the lease and does not initiate and diligently pursue steps to correct the default within thirty days after notice has been
given to it by owner specifying with particularity the nature of the default, then upon the expiration of the thirty-day period, all rights of Navigator under the lease terminate and all
liabilities and obligations of Navigator except royalties then due terminate. Any default claimed with respect to the payment of money may be cured by the deposit in escrow of the amount in
controversy (not including claimed consequential, special, exemplary, or punitive damages) and giving of notice of the deposit to the owner, the amount to remain in escrow until the controversy is
resolved by decision of a court or otherwise. If Navigator by notice to owner disputes the existence of a default, then the lease shall not terminate unless Navigator does not initiate and diligently
pursue steps to correct the default within thirty days after the existence of a default has been determined by decision of a court or otherwise.

The
owner of the property on which the Zala M claims are located is the Lawson Trust. The beneficial owners of the Lawson Trust are L.E. Lawson and Verla Lawson. Under the terms of the
lease, Navigator is obligated to pay royalties of 2.5% of the net returns from all minerals sold or

1

---

processed. In addition, Navigator must pay a minimum annual royalty as follows, of which the first payment of $1,000 has already been made:

Anniversary Date

AmountSept. 30, 2000

$
1,000.00Sept. 30, 2001

$
5,000.00Sept. 30, 2002

$
10,000.00Sept. 30, 2003

$
20,000.00Sept. 30 2004 & thereafter

$
40,000.00


In
addition, Navigator is obligated under the terms of the lease to expend $435,719 as part of an exploration commitment on or before September 30, 2003, the third anniversary
date of lease. Navigator must have performed the work on or for the benefit of the leased mineral claims in the following manner:



Our
business activities to date have been restricted to obtaining a report from our mining engineer, R.E. Miller, raising initial capital of $25,000 and conducting a public offering that
raised $100,000. According to Mr. Miller's report, since the discovery of the Zala M vein in 1898, considerable exploration and minor intermittent precious metal production has taken place on
the property leased by Navigator. Early exploration appears to have been conducted mainly by trenching and the development of shallow pits. More modern efforts have involved geophysical and
geochemical techniques, percussion drilling and core drilling. Precious metal production has come primarily from underground workings at the Zala M. Surface and underground stopes on the Zala M are
reported to have produced 5,000 tons of ore from quartz vein.

This
report recommends the investigation of two major targets that exist on the property for additional exploration work. Initially 2000 feet of drilling is recommended to evaluate the
Zala M precious metal
bearing quartz vein at depth. The second recommendation involves detailed geologic mapping followed by drilling of any targets that are found to occur along the eastern zone of the Zala M vein system.

The
exploration program has been separated into the three phases. We will not be able to complete Phase I unless more than 75% of this offering is sold. Each phase is dependent on the
results of the previous phase:

Phase I-

$
61,299.00

Zala M drilling and east contact explorationPhase II-

$
112,791.00

Continued east contact zone exploration and drillingPhase III-

$
261,628.00

Continued exploration and drilling




The Zala M Group Properties consist of five patented and ten unpatented claims totaling approximately 277 acres. The property is located in the Wauconda mining
district of Okanogan County and the Eureka mining district of Ferry County and is approximately 17.5 miles northwest of Republic, Washington. Access to the region from Vancouver, B.C. is by Highway
No. 3 to Carson B.C. and Washington State Highways No. 20 and No. 21 to Republic, a road distance of 350 miles. Property access from Republic is by way of the Trout Creek Road for
6.5 miles to Ferry County Road 514, a

2

---

well-maintained gravel road, and the Sheridan Road for 8.0 miles to the Zala M Group claims. A number of well-maintained forestry service roads provide good access to most
areas of the property.



The topography is moderate with rounded ridges and narrow valleys. Elevations range from 4500 feet to a high of 5498 feet at the summit of Horseshoe Mountain. The
area, located in the Colville National Forest, is covered with merchantable timber and has been subject to logging in the past.

The
area is semi-arid with an average 18-inch rainfall, cold winters and warm to hot summers. Good water supplies exist at Toroda Creek, 3.5 miles west of the
claims, and from a spring located near the Zala Mining claim on the property.



Aegis Resources Ltd mapped the geology in 1976-77 by the Dusty Mac-Occidental-Quintana consortium and in 1985. The two upper
members of the tertiary Klondike Mountain formation generally underlie most of the property. The Middle Member, which is composed of pale, colored, greenish volcanic breccias, a type of rock whose
components are angular in shape, as distinguished from a conglomerate, whose components are water-worn into a rounded shape, and lava flows, occurs in the southern part of the property and
the Upper Member, consisting of dark gray, bitric lava flows in the northern property areas. The flows are generally flat lying and at the Silver Bell breccias zone, they are of rhyolite tuff
composition. The host rocks at the Zala M mine have been described as trachytic andesite and an andesite breccia. Andesite is a fine grained igneous rock with no quartz or orthoclase, composed of
about 75% plagioclase feldspars and 25% ferromagnesium silicate.

In
the southeastern property area units of the Pre Permian Tonata Creek Formation comprising metamorphosed sediments and marbelized limestone occur and are in contact with units of the
Klondike and the granodiorite. Granodiorite is a coarse-grained igneous rock intermediate in composition between granite and diorite. The contact between these units and the granites on the east cuts
through the southeastern part of the claims and trends northeasterly, generally within the eastern property boundary.



We must conduct exploration to determine what amount of minerals, if any, exist on our properties, and if any minerals which are found can be economically
extracted and profitably processed.

Our
exploration program is designed to economically explore and evaluate our claims.

We
do not claim to have any minerals or reserves whatsoever at this time on any of our claims.

We
intend to implement an exploration program and to proceed in the following three phases:

Phase
1 will begin with research of the available geologic literature, personal interviews with geologists, mining engineers and others familiar with the prospect sites.

When
research is completed, our initial work will be augmented with geologic mapping, geophysical testing and geo-chemical testing of our claims. When available, existing
workings, like trenches, prospect pits, shafts or tunnels will be examined. If an apparent mineralized zone is identified and narrowed down to a specific area by the studies, we will begin trenching
the area.

Trenches
that appear on the property are generally five feet in length and 300 feet wide. These trenches are the result of exploration that was carried out on the property between 1898
and 1985. Trenches allow for a thorough examination of the surface of the vein structure types generally encountered in the area. They also allow easier restoration of the land to its
pre-exploration condition

3

---

when we conclude our operations. Once excavation of a trench is completed, samples are taken and then analyzed for economically potential minerals that are known to have occurred in the area. Careful
interpretation of this available data collected from the various tests aid in determining whether or not the prospect has current economic potential and whether further exploration is warranted. Phase
1 will take about three months and cost up to $61,299.

Phase
2 involves an initial examination of the underground characteristics of the vein structure that was identified by Phase 1 of exploration. Phase 2 is aimed at identifying any
mineral deposits of potential economic importance. The methods employed are



Drift
driving is the process of constructing a tunnel to take samples of minerals for testing. Later, the tunnel can be used for mining minerals. The geophysical work gives a general
understanding of the location and extent of mineralization at depths that are unreachable by surface excavations and provides a target for more extensive trenching and core drilling. Trenching
identifies the continuity and extent of mineralization, if any, below the surface. After a thorough analysis of the data collected in Phase 2, we will decide if the property warrants a Phase 3 study.
Phase 2 will take about six months and cost up to $112,791.

Phase
3 is aimed at precisely defining the depth, the width, the length, the tonnage and the value per ton of any mineral body. This is accomplished through extensive drift driving.
Phase 3 will take about twelve months and cost up to $261,628.

We
do not intend to interest other companies in the property if we find mineralized materials. We intend to try to develop the reserves ourselves.

COMPETITION

The mineral industry is fragmented. We compete with other exploration companies looking for a variety of mineral reserves. We may be one of the smallest
exploration companies in existence. Although we will be competing with other exploration companies, there is no competition for the exploration or removal of minerals from our property. Readily
available markets exist in North America and around the world for the sale of minerals. Therefore, we intend to develop mining claims to the production point in which major mining production companies
would seriously consider pursuing the property as a valuable and significant acquisition.

EMPLOYEES

We have no full time employees. Our President has agreed to allocate a portion of his time to our business activities, without compensation. This officer
anticipates that our business plan can be implemented by his devoting minimal time per month to our business affairs and, consequently, conflicts of interest may arise with respect to the limited time
commitment by such officer.

TRADEMARKS

We do not utilize any trademarks or patent rights in our business.

GOVERNMENT REGULATIONS

General exploration work including surveying, geophysical and geochemical programs that do minimal surface disturbance do not require county, state or federal
permits. The initial drilling program

4

---

will only require minimal permits as the surface and minerals are privately owned. Expansion in the Phase II and III will likely need approval and bonding.

The
activity in Phase I is related to work on the patented claims for which the surface and mineral title is privately owned by the Lawson Trust. The permitting process is for the
purposes of notification. For private land, such as the property leased by Navigator, it requires notifying Ferry County where the claims are located of the planned work, including a map of the area
where the work is proposed.

The
county will act like a "lead agency" and may require Navigator to fill out the Washington State Environmental Agency forms which will help clarify the counties position as lead
agency. Should the county determine that the United States Bureau of Land Management ("BLM") and/or Washington State Department of Natural Resources ("DNR") has some jurisdiction they will notify
those agencies. From the Plan of Operation these agencies will determine what restrictions will be set; if any bonding is required and the degree of reclamation.

ITEM 2. DESCRIPTION OF PROPERTY

We have no properties and at this time has no agreements to acquire any properties. We intend to attempt to acquire assets or a business in exchange for its
securities which assets or business is determined to be desirable for its objectives.

Facilities.Our principal place of business is an executive office which consists of approximately 200 square feet of
executive office space. This space is provided to us on a rent free basis by our president, an officer and director and it is anticipated that this arrangement will remain until such time as we
successfully consummates a merger or acquisition. Management believes that this space will meet our needs for the foreseeable future.

ITEM 3. LEGAL PROCEEDINGS

There are no material legal proceedings to which we (or any of our officers and directors in their capacities as such) is a party or to which our property is
subject and no such material proceedings is known by our management to be contemplated.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our audited financial statements and notes thereto included herein. In connection with, and because we
desire to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we caution readers

5

---

regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings with the
Securities and Exchange Commission. Forward looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other
developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and
contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results
and could cause actual results to differ materially from those expressed in any forward looking statements made by, or our behalf. We disclaim any obligation to update forward looking statements.

We
are a start-up, exploration stage company and have not yet generated or realized any revenues from our business operations.

Our
auditors have issued a going concern opinion. This means that our auditors believe there is doubt that we can continue as an on-going business for the next twelve months
unless we obtain additional capital to pay our bills. This is because we have not generated any revenues and no revenues are anticipated until we begin removing and selling minerals. Accordingly, we
must raise cash from sources other than the sale of minerals found on our property. Our only other source for cash at this time is investments by others in our company. We must raise cash to implement
our project and stay in business.

Results of Operations From Inception on May 24, 2000

We just recently acquired our first interest in patented and unpatented lode mineral claims. At this time we have not yet commenced the research and/or
exploration stage of our mining operations on that property. We have paid $1,000 for a mining lease. In addition, we have paid $4,000 to R.E. Miller, a mining engineer, for a report on the property.
As of September 30, 2001 we have experienced operating losses of $57,076.

Plan of Operations

Since inception, we have used our common stock to raise money for our property acquisition, for corporate expenses and to repay outstanding indebtedness. Net cash
provided by financing activities from inception on May 24, 2000 to December 31, 2000 was $25,000 as a result of proceeds received from our president and sole director. Our business
activities to date have been restricted to obtaining a mining engineer's report and conducting a public offering from which we raised $100,000 in gross proceeds.

Navigator's
plan of operations for the next twelve months is to undertake Phase I of the drilling and exploration program. Phase I is estimated to be $61,299.00 and therefore can not be
completed unless more than 75% of the offering is sold. If only 50% of the offering is sold, we will be able to make an annual royalty payment, obtain permits, bonds and conduct land preparation along
with surveying, drill site location and some drilling, but we will not be able to complete our exploration program or analyze the results. If only 25% of our offering is sold, we will be able to pay
the offering expenses, the annual minimum royalty and do some limited land preparation. If less than 25% of the offering is sold we will become indebted for offering expenses and we may have to cease
operations entirely. We have no plan to engage in any alternative business if Navigator ceases or suspends operations as a result of not having enough money to complete any phase of the exploration
program.

Phase
I will involve drilling a three holes to investigate the extent of mineralization of the Zala M claims. We also intend to investigate the east contact zone of the leased property
for additional mineral deposits. Permitting, drilling and associated expenses for investigating the Zala M claims will cost approximately $52,700. Geological mapping of the east contact zone will cost
approximately $3,710.00.

6

---

Expenses associated with the geologist's report for Phase I are anticipated to be approximately $1,970.00. We also plan to reserve a 5 percent contingency fund for unforeseen expenses of
$2,919.00.

Liquidity and Capital Resources

As of the date of this report, we have yet to generate any revenues from our business operations. Since our inception, Mr. Anderson has paid $25,000 in
cash in exchange for 250,000 shares of common stock. This money has been utilized for organizational and start-up costs and as operating capital. We have also raised gross proceeds of
$100,000 from the sale of stock registered in our SB-2 offering. As of September 30, 2002 we had sustained operating losses $57.076.

INFLATION

Although our operations are influenced by general economic conditions, we do not believe that inflation had a material affect on the results of operations during
the fiscal year ended December 31, 2001.

7

---



ITEM 7. FINANCIAL STATEMENTS

NAVIGATOR VENTURES, INC.    INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

|                                                                                                |  | PAGE
|----------------------------------------------------------------------------------------------- |  | ----
|Independent Auditors' Report                                                                    |  | F-1 
|Consolidated balance sheets as of December 31, 2001 and 2000                                    |  | F-2 
|Consolidated statements of operations for the years ended December 31, 2001 and 2000            |  | F-3 
|Consolidated statements of cash flows for the years ended December 31, 2001 and 2000            |  | F-4 
|Consolidated statements of stockholders' deficit for the years ended December 31, 2001 and 2000 |  | F-5 
|Notes to consolidated financial statements                                                      |  | F-6 

8

---



|TERRY AMISANO LTD. |  | AMISANO HANSON       
|------------------ |  | ---------------------
|KEVIN HANSON, C.A. |  | CHARTERED ACCOUNTANTS

INDEPENDENT AUDITORS' REPORT

To
the Stockholders,
Navigator Ventures, Inc.

We
have audited the accompanying balance sheets of Navigator Ventures, Inc. (An Exploration Stage Company) as of December 31, 2001 and 2000 and the statements of
operations, stockholders' deficiency and cash flows for the year ended December 31, 2001, the seven months ended December 31, 2000 and for the period May 24, 2000 (Date of
Incorporation) to December 31, 2001. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements
based on our audits.

We
conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform an audit to obtain
reasonable assurance
whether the financial statements are free of material misstatement. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.

In
our opinion, these financial statements referred to above present fairly, in all material respects, the financial position of Navigator Ventures, Inc. as of December 31,
2001 and 2000 and the results of its operations and its cash flows for the year ended December, 31 2001, the seven months ended December 31, 2000 and for the period from May 24, 2000
(Date of Incorporation) to December 31, 2001, in conformity with accounting principles generally accepted in the United States of America.

The
accompanying financial statements referred to above have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial
statements, the Company is in the exploration stage, and has no established source of revenue and is dependent on its ability to raise capital from shareholders or other sources to sustain operations.
These factors, along with other matters as set forth in Note 1, raise substantial doubt that the Company will be able to continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

|Vancouver, Canada |  | "AMISANO HANSON"     
|----------------- |  | ---------------------
|March 12, 2002    |  | Chartered Accountants

|750 WEST PENDER STREET, SUITE 604 |  | TELEPHONE:  604-689-0188
|--------------------------------- |  | ------------------------
|VANCOUVER, CANADA                 |  | FACSIMILE:  604-689-9773
|V6C 2T7                           |  | E-MAIL:amishan@telus    

F-1

---



NAVIGATOR VENTURES, INC.  (An Exploration Stage Company)        BALANCE SHEETS        December 31, 2001 and 2000        (Stated in US Dollars)

|                                                                                         |                     | 2001 |         | 2000   |  
|---------------------------------------------------------------------------------------- | ------------------- | ---- | ------- | ------ | -
|ASSETS                                                                                   |                     |      |         |        |  
|Current                                                                                  |                     |      |         |        |  
|                                                                                         | Cash                |      | $       | 38,328 |  
|                                                                                         | Accounts receivable |      |         | 250    |  
|                                                                                         | Prepaid expenses    |      |         | 10,000 |  
|                                                                                         |                     |      |         |        |  
|                                                                                         |                     |      | 48,578  |        |  
|Mineral propertyNote 3                                                                  |                     |      |        |        |  
|                                                                                         |                     |      |         |        |  
|                                                                                         |                     | $    | 48,578  |        | $
|                                                                                         |                     |      |         |        |  
|LIABILITIES                                                                              |                     |      |         |        |  
|Current                                                                                  |                     |      |         |        |  
|                                                                                         | Accounts payable    |      | $       | 12,303 |  
|                                                                                         |                     |      |         |        |  
|STOCKHOLDERS' EQUITY                                                                     |                     |      |         |        |  
|Preferred stock, $0.001 par value 5,000,000 shares authorized, none outstanding          |                     |      |         |        |  
|Common stock, $0.001 par value 45,000,000 shares authorized 2,250,000 shares outstanding |                     |      | 2,250   |        |  
|Additional paid-in capital                                                               |                     |      | 122,750 |        |  
|                                                                                         |                     |      |         |        |  
|                                                                                         |                     |      | 125,000 |        |  
|Deficit accumulated during the exploration stage                                         |                     |      | (88,725 | )      |  
|                                                                                         |                     |      |         |        |  
|                                                                                         |                     |      | 36,275  |        |  
|                                                                                         |                     |      |         |        |  
|                                                                                         |                     | $    | 48,578  |        | $
|                                                                                         |                     |      |         |        |  

Nature
and Continuance of OperationsNote 1
CommitmentsNote 3
Subsequent EventNote 3

|APPROVED BY THE DIRECTOR: |            |  | 
|------------------------- | ---------- |  | 
|"Reid Anderson"           | , Director |  | 

SEE
ACCOMPANYING NOTES

F-2

---



NAVIGATOR VENTURES, INC.  (An Exploration Stage Company)        STATEMENT OF OPERATIONS        for the year ended December 31, 2001, the seven months ended
December 31, 2000  and for the period May 24, 2000 (Date of Incorporation) to December 31, 2001        (Stated in US Dollars)

|                                              |                           | For the year ended December 31, 2001 |         | For the seven months ended December 31, 2000 |   | May 24, 2000
(Date of Incorporation) to
December 31, 2001 |       
|--------------------------------------------- | ------------------------- | ------------------------------------ | ------- | -------------------------------------------- | - | --------------------------------------------------------- | ------
|Administrative Expenses                       |                           |                                      |         |                                              |   |                                                           |       
|                                              | Accounting and audit      |                                      | $       | 5,176                                        |   | $                                                         | 5,584 
|                                              | Bank charges              |                                      |         | 443                                          |   |                                                           | 127   
|                                              | Business plan             |                                      |         |                                             |   |                                                           | 1,177 
|                                              | Development costs         |                                      |         |                                             |   |                                                           | 4,000 
|                                              | Legal fees                |                                      |         | 27,663                                       |   |                                                           | 10,000
|                                              | Management fees           |                                      |         | 7,000                                        |   |                                                           | 5,000 
|                                              | Transfer agent fees       |                                      |         | 2,315                                        |   |                                                           |      
|                                              |                           |                                      |         |                                              |   |                                                           |       
|Loss before other item                        |                           |                                      | (42,597 | )                                            |   | (25,888                                                   | )     
|Other item                                    |                           |                                      |         |                                              |   |                                                           |       
|                                              | Mineral property expenses |                                      |         | (20,240                                      | ) |                                                           |      
|                                              |                           |                                      |         |                                              |   |                                                           |       
|Net loss for the period                       |                           |                                      | (62,837 | )                                            |   | (25,888                                                   | )     
|                                              |                           |                                      |         |                                              |   |                                                           |       
|Deficit, beginning of year                    |                           |                                      | (25,888 | )                                            |   |                                                          |       
|                                              |                           |                                      |         |                                              |   |                                                           |       
|Deficit, end of year                          |                           | $                                    | (88,725 | )                                            | $ | (25,888                                                   | )     
|                                              |                           |                                      |         |                                              |   |                                                           |       
|Basic loss per share                          |                           | $                                    | (0.11   | )                                            | $ | (0.33                                                     | )     
|                                              |                           |                                      |         |                                              |   |                                                           |       
|Weighted average number of shares outstanding |                           |                                      | 583,333 |                                              |   | 79,549                                                    |       
|                                              |                           |                                      |         |                                              |   |                                                           |       

SEE
ACCOMPANYING NOTES

F-3

---



NAVIGATOR VENTURES, INC.  (An Exploration Stage Company)        STATEMENT OF CASH FLOWS        for the year ended December 31, 2001, the seven months ended
December 31, 2000  and for the period May 24, 2000 (Date of Incorporation) to December 31, 2001        (Stated in US Dollars)

|                                               |                                                                    | For the year ended December 31, 2001 |         | For the seven months ended December 31, 2000 |         | May 24, 2000
(Date of Incorporation) to
December 31, 2001 |        
|---------------------------------------------- | ------------------------------------------------------------------ | ------------------------------------ | ------- | -------------------------------------------- | ------- | --------------------------------------------------------- | -------
|Cash flows from (used in) Operating Activities |                                                                    |                                      |         |                                              |         |                                                           |        
|                                               | Net loss for the period                                            |                                      | $       | (62,837                                      | )       | $                                                         | (25,888
|                                               | Add item not affecting cash                                        |                                      |         |                                              |         |                                                           |        
|                                               |                                                                    | Mineral property written-off         |         |                                              | 1,000   |                                                           |        
|                                               | Changes in non-cash working capital balances related to operations |                                      |         |                                              |         |                                                           |        
|                                               |                                                                    | Share subscription receivable        |         |                                              | (250    | )                                                         |        
|                                               |                                                                    | Prepaid expenses                     |         |                                              | (10,000 | )                                                         |        
|                                               |                                                                    | Accounts payable                     |         |                                              | 7,719   |                                                           |        
|                                               |                                                                    |                                      |         |                                              |         |                                                           |        
|                                               |                                                                    |                                      | (64,368 | )                                            |         | (21,304                                                   | )      
|                                               |                                                                    |                                      |         |                                              |         |                                                           |        
|Cash flows used in Investing Activity          |                                                                    |                                      |         |                                              |         |                                                           |        
|                                               | Mineral property acquisition costs                                 |                                      |         |                                             |         |                                                           | (1,000 
|                                               |                                                                    |                                      |         |                                              |         |                                                           |        
|Cash flows from Financing Activity             |                                                                    |                                      |         |                                              |         |                                                           |        
|                                               | Capital stock issued                                               |                                      |         | 100,000                                      |         |                                                           | 11,000 
|                                               | Capital stock subscribed                                           |                                      |         |                                             |         |                                                           | 14,000 
|                                               |                                                                    |                                      |         |                                              |         |                                                           |        
|                                               |                                                                    |                                      | 100,000 |                                              |         | 25,000                                                    |        
|                                               |                                                                    |                                      |         |                                              |         |                                                           |        
|Increase in cash during the period             |                                                                    |                                      | 35,632  |                                              |         | 2,696                                                     |        
|Cash, beginning of the period                  |                                                                    |                                      | 2,696   |                                              |         |                                                          |        
|                                               |                                                                    |                                      |         |                                              |         |                                                           |        
|Cash, end of the period                        |                                                                    | $                                    | 38,328  |                                              | $       | 2,696                                                     |        
|                                               |                                                                    |                                      |         |                                              |         |                                                           |        

SEE
ACCOMPANYING NOTES

F-4

---



NAVIGATOR VENTURES, INC.  (An Exploration Stage Company)        STATEMENT OF STOCKHOLDERS' DEFICIENCY        for the year ended December 31, 2001, the seven
months ended December 31, 2000  and for the period May 24, 2000 (Date of Incorporation) to December 31, 2001        (Stated in US Dollars)

|                                                                              |  | Common Shares |  |   |       | Deficit Accumulated During the Exploration Stage |   |         | 
|----------------------------------------------------------------------------- |  | ------------- |  | - | ----- | ------------------------------------------------ | - | ------- | 
|
|
|Capital stock subscribed pursuant to an offering memorandum for cashat $0.10 |  | 250,000       |  | $ | 250   |                                                  | $ | 24,750  | 
|Net loss for the period                                                       |  |              |  |   |      |                                                  |   |        | 
|                                                                              |  |               |  |   |       |                                                  |   |         | 
|Balance, December 31, 2001                                                    |  | 250,000       |  |   | 250   |                                                  |   | 24,750  | 
|Capital stock issued pursuant to an initial public offeringat $0.05          |  | 2,000,000     |  |   | 2,000 |                                                  |   | 98,000  | 
|Net loss for the year                                                         |  |              |  |   |      |                                                  |   |        | 
|                                                                              |  |               |  |   |       |                                                  |   |         | 
|Balance, December 31, 2001                                                    |  | 2,250,000     |  | $ | 2,250 |                                                  | $ | 122,750 | 
|                                                                              |  |               |  |   |       |                                                  |   |         | 

SEE
ACCOMPANYING NOTES

F-5

---



NAVIGATOR VENTURES, INC.  (An Exploration Stage Company)        NOTES TO THE FINANCIAL STATEMENTS        December 31, 2001 and 2000        (Stated
in US Dollars)

Note 1 Nature and Continuance of Operations

The Company was incorporated in the State of Nevada, U.S.A. on May 24, 2000.

The
Company is in the exploration stage. The Company has entered into a lease agreement to explore and mine a resource property located in Washington State, United States and has not yet
determined whether this property contains reserves that are economically recoverable. The recoverability of amounts from the resource 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
resource 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 accumulated a deficit of $88,725 since inception. 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.

Note 2 Summary of Significant Accounting Policies

The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America. Because a
precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been
made using careful judgement. Actual results may vary from these estimates.

The
financial statements have, in management's opinion, been properly prepared within reasonable limits of materiality and within the framework of the significant accounting policies
summarized below:



The Securities and Exchange Commission's Exchange Act Guide 7 "Description of property by issuers engaged or to be engaged in significant mining operations"
requires that mining companies in the exploration stage should not refer to themselves as development stage companies in the financial statements, even though such companies should comply with
Financial Accounting Standard Board Statement No. 7, if applicable. Accordingly, the Company has not been referred to as being a development stage company.



The acquisition of mineral properties pursuant to option payments and exploration costs are expensed as incurred. Exploration and development costs relating to
these properties are expensed unless the Company determines that a commercial orebody is present after which cost of development will be capitalized. Upon commercial production, mineral
property costs will be amortized on the unit of production basis, until the properties are abandoned or sold, at which time the costs ware written off. Mineral properties are abandoned, when the
claims are no longer in good standing or

F-6

---

the agreements covering the claims are in default, and in either case management has determined that the abandonment is appropriate.



Environmental expenditures that relate to current operations are expensed 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 expensed. 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.



The Company reports basic loss per share in accordance with the Statement of Financial Accounting Standards No. 128, "Earnings Per Share". Basic loss per
share is computed using the weighted average number of shares outstanding during the period. Diluted loss per share has not been provided as it would be anti-dilutive.



The Company uses the liability method of accounting for income taxes pursuant to Statement of Financial Accounting Standards, No. 109 "Accounting for
Income Taxes".



The carrying value of cash, share subscription receivable and accounts payable approximates fair value because of the short maturity of these instruments. Unless
otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial statements.



Management does not believe that any recently issued, but not yet effective accounting standards if currently adopted could have a material effect on the
accompanying financial statements.

Note 3 Mineral Properties

By a lease agreement dated September 15, 2000 and amended October 25, 2001, the Company was granted the exclusive right to explore and mine the Zala
M Group claims located in Ferry and

F-7

---

Okanogan Counties of North Central Washington State for the following minimum royalty payments and exploration commitment:

Minimum
Royalty Payments:

The
owner shall be paid a royalty of 3% of the net returns from all production. In respect to this royalty, the Company is required to pay minimum royalty payments of the following:



Exploration
Commitment:

The
Company must incur $435,719 on exploration expenditures prior to September 30, 2004 as follows:

Date

Minimum
ExplorationOn or before September 30, 2002

$
61,299On or before September 30, 2003


112,791On or before September 30, 2004


261,628$
435,719


The
term of this lease is for 10 years. The term may be extended by the Company for two periods of 10 years by the Company giving notice to the owner.

Note 4 Stockholders' Equity

On October 31, 2001, the Company issued 2,000,000 common shares at $0.05 per share for $100,000 pursuant to an initial public offering.

Note 5 Deferred Tax Assets

The Financial Accounting Standards Board issued Statement Number 109 in Accounting for Income Taxes ("FAS 109") which is effective for fiscal years
beginning after December 15, 1992. FAS 109 require the use of the asset and liability method of accounting of income taxes. Under the assets and liability method of FAS 109,
deferred tax assts and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of existing assets and
liabilities and their respective tax bases. Deferred tax assets and

F-8

---

liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The
following table summarizes the significant components of the Company's deferred tax assets:

TotalDeferred Tax AssetsNon-capital loss carryforward

$
88,726Gross deferred tax assets

$
44,363Valuation allowance for deferred tax asset


(44,363
)$



The
amount taken into income as deferred tax assets must reflect that portion of the income tax loss carryforwards that is likely to be realized from future operations. The Company has
chosen to provide an allowance of 100% against all available income tax loss carryforwards, regardless of their time of expiry.

Note 6 Income Taxes

No provision for income taxes has been provided in these financial statements due to the net loss. At December 31, 2001 the Company has net operating loss
carryforwards, which expire commencing in 2020, totalling approximately $88,725, the benefit of which has not been recorded in these financial statements.

F-9

---



ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.

Directors are elected for one-year terms or until the next annual meeting of shareholders and until their successors are duly elected and qualified.
Officers continue in office at the pleasure of the Board of Directors.

The
Directors and Officers of the Company as of the date of this report are as follows:

Name

Age

PositionJohn Reid Anderson

40

President, Secretary, Treasurer


All
our Directors hold office until the next annual meeting of our shareholders and until successors have been elected and qualified. Our officers are elected by our Board of Directors
and hold office until their death or until they resign or are removed from office.

There
are no family relationships among the officers and directors. There is no arrangement or understanding between us (or any of our directors or officers) and any other person
pursuant to which such person was or is to be selected as a director or officer.

ITEM 10. EXECUTIVE COMPENSATION.

Remuneration

The following table reflects all forms of compensation for services to us for the years ended December 31, 2000 and 1999 of our then chief executive
officer.

SUMMARY COMPENSATION TABLE

|                                      |  |           |  |    |     |  |     |  |     | Long Term Compensation |     | 
|------------------------------------- |  | --------- |  | -- | --- |  | --- |  | --- | ---------------------- | --- | 
|
|
|J.R. Anderson
President & Director(1) |  | 2000
2001 |  | $$ | 0
0 |  | 0
0 |  | 0
0 |                        | 0
0 | 

9

---

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

(a) and (b) Security Ownership of Certain Beneficial Owners and Management.

The
table below lists the beneficial ownership of the our voting securities by each person known by us to be the beneficial owner of more than 5% of such securities, as well as by all of
our directors and officers, as of the date of this report. Unless otherwise indicated, the shareholders listed possess sole voting and investment power with respect to the shares shown.

Title of Class

Name and Address of Beneficial Owner(1)

Amount and Nature of Beneficial Ownership

Percent of ClassCommon

J.R. Anderson
207-1425 Marine Drive,
West Vancouver, B.C.
V7T 1B9

250,000

11
%


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

In connection with the organization of Navigator, John Reid Anderson, the founding shareholder, President, Secretary-Treasurer and Director of our company, has
paid an aggregate of $25,000.00 cash to purchase 250,000 shares of common stock of Navigator. Navigator presently has no office facilities but for the time being will use as its business address the
office of Mr. Anderson on a rent free basis, until such time as the business operations of our company may require more extensive facilities and our company has the financial ability to rent
commercial office space. There is presently no formal written agreement for the use of such facilities, and no assurance that such facilities will be available to our company on such a basis for any
specific length of time.

We
have no formal written employment agreement or other contracts with our officers, and there is no assurance that the services to be provided by them, and facilities to be provided by
Mr. Anderson, will be available for any specific length of time in the future. Mr. Anderson anticipates initially devoting up to approximately 15% of his time to the affairs of our
company. If and when the business operations of our company increase and a more extensive time commitment is needed, Mr. Anderson is prepared to devote more time to our company, in the event
that becomes necessary. The amounts of compensation and other terms of any full time employment arrangements with our company would be determined if and when such arrangements become necessary.

PART IV

Item 13. EXHIBITS AND REPORTS ON FORM 8-K.

None

10

---



SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on April 3, 2002.

| |  | NAVIGATOR VENTURES, INC.(Registrant)
| |  | ------------------------------------
| |  | By:                                 

In
accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on April 3, 2002.

| |  | By: |  | /s/JOHN REID ANDERSONJohn Reid Anderson, Director
| |  | --- |  | -------------------------------------------------

11

---



NAVIGATOR VENTURES, INC.

Exhibit Index to Annual Report on Form 10-KSB For the Fiscal Year Ended December 31, 2001

EXHIBITS

|3.1  |  | Certificate and Articles of Incorporation*
|---- |  | ------------------------------------------
|3.2  |  | Bylaws**                                  
|10.1 |  | Mining Lease***                           

---

12

---

QuickLinks