---

UNITED STATESSECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C.
20549

FORM 20-F

 ̈ REGISTRATION STATEMENT
  PURSUANT TO SECTION 12(b) or 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

x ANNUAL REPORT PURSUANT
  TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended July 31, 2005 (with other
information to November 30, 2005 except where noted)

OR

 ̈ TRANSITION REPORT
  PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________to
_______________

OR

 ̈ SHELL COMPANY REPORT
  PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report
_______________

Commission file number 0-15490

QUARTZ MOUNTAIN RESOURCES
LTD.(Exact name of Registrant specified in its charter)

Suite 1020  800 West Pender Street, Vancouver,
British Columbia, Canada, V6C 2V6(Address of principal executive
offices)

COMMON SHARES WITHOUT PAR VALUE(Title of
Class)

Securities registered or to be registered pursuant to Section
12(b) of the Act.

|Title of Each
      Class | Name
      of each exchange on which registered
|------------------------- | -----------------------------------------------
|None                      | Not applicable                                 

Securities registered or to be registered pursuant to Section
12(g) of the Act

Common Shares without Par Value(Title of
Class)

Securities for which there is a reporting obligation pursuant to
Section 15(d) of the Act. None

---

Number of outstanding shares of the Companys only class of
capital stock as at November 30, 2005:

11,889,426 Common Shares Without Par Value

Indicate by check mark whether Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934during the preceding 12 months (or for such shorter
period that Registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

Yes x No  ̈

Indicate by check mark which financial statement item Registrant
  has elected to follow:

Item 17 x Item
  18  ̈

If this is an annual report, indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act).

Yes x No  ̈

---



T A B L E   O F   C O N T E N T S

|              |                                                                                    | Page
|------------- | ---------------------------------------------------------------------------------- | ----
|              |                                                                                    |     
|ITEM
      1  | IDENTITY
      OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS                        | 2   
|              |                                                                                    |     
|ITEM
      2  | OFFER
      STATISTICS AND EXPECTED TIMETABLE                                      | 3   
|              |                                                                                    |     
|ITEM
      3  | KEY
      INFORMATION                                                              | 4   
|              |                                                                                    |     
|ITEM
      4  | INFORMATION
      ON THE COMPANY                                                   | 9   
|              |                                                                                    |     
|ITEM
      5  | OPERATING
      AND FINANCIAL REVIEW AND PROSPECTS                                 | 11  
|              |                                                                                    |     
|ITEM
      6  | DIRECTORS,
      SENIOR MANAGEMENT AND EMPLOYEES                                   | 15  
|              |                                                                                    |     
|ITEM
      7  | MAJOR
      SHAREHOLDERS AND RELATED PARTY TRANSACTIONS                            | 21  
|              |                                                                                    |     
|ITEM
      8  | FINANCIAL
      INFORMATION                                                        | 23  
|              |                                                                                    |     
|ITEM
      9  | THE
      OFFER AND LISTING                                                        | 24  
|              |                                                                                    |     
|ITEM
      10 | ADDITIONAL
      INFORMATION                                                       | 26  
|              |                                                                                    |     
|ITEM
      11 | QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                   | 36  
|              |                                                                                    |     
|ITEM
      12 | DESCRIPTION
      OF SECURITIES OTHER THAN EQUITY SECURITIES                       | 37  
|              |                                                                                    |     
|ITEM
      13 | DEFAULTS,
      DIVIDEND ARREARAGES AND DELINQUENCIES                              | 38  
|              |                                                                                    |     
|ITEM
      14 | MATERIAL
      MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS | 39  
|              |                                                                                    |     
|ITEM
      15 | CONTROLS
      AND PROCEDURES                                                      | 40  
|              |                                                                                    |     
|ITEM
      16 | AUDIT
      COMMITTEE, CODE OF ETHICS, ACCOUNTANT FEES AND EXEMPTIONS              | 41  
|              |                                                                                    |     
|ITEM
      17 | FINANCIAL
      STATEMENTS                                                         | 42  
|              |                                                                                    |     
|ITEM
      18 | FINANCIAL
      STATEMENTS                                                         | 43  
|              |                                                                                    |     
|ITEM
      19 | EXHIBITS                                                                           | 44  

---

PART 1 GENERAL

In this Annual Report on Form 20-F, all references to we, the
Company or Quartz refer to Quartz Mountain Resources Ltd. and its
consolidated subsidiaries.

The Company uses the United States dollar as its reporting
currency. All references in this document to dollars or $ are expressed in
United States dollar, unless otherwise indicated.

Except as noted, the information set forth in this Annual
Report is as of November 30, 2005 and all information included in this document
should only be considered correct as of such date.

NOTE ON FORWARD LOOKING STATEMENTS

Except for the statements of historical fact contained herein,
some information presented in this Annual Report constitutes forward-looking
statements. When used in this Annual Report, the words estimate, project,
believe, anticipate, intend, expect, predict, may, should, the
negative thereof or other variations thereon or comparable terminology are
intended to identify forward-looking statements. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of Quartz to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among others,
those factors discussed in the section entitled Risk Factors. Although Quartz
has attempted to identify important factors that could cause actual results to
differ materially, there may be other factors that cause actual results not to
be as anticipated, estimated or intended. There can be no assurance that such
statements will prove to be accurate as actual results and future events could
differ materially from those anticipated in such statements. Accordingly,
prospective investors should not place undue reliance on forward-looking
statements. The forward-looking statements in this Annual Report speak only as
to the date hereof. Quartz does not undertake any obligation to release publicly
any revisions to these forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.

Although the Company believes that the expectations reflected
in the forward-looking statements are reasonable, the Company cannot guarantee
future results, levels of activity, performance or achievements. Except as
required by applicable law, including the securities laws of the United States,
the Company does not intend to update any of the forward-looking statements to
conform these statements to actual results.

1

---

ITEM 1     IDENTITY OF DIRECTORS, SENIOR
MANAGEMENT AND ADVISERS

Not applicable.

2

---

ITEM 2    OFFER STATISTICS AND EXPECTED
TIMETABLE

Not applicable.

3

---

ITEM 3    KEY INFORMATION

A.    Selected Financial Data

The following table presents selected financial data derived
from the audited consolidated financial statements of Quartz for the last five
fiscal years ended July 31, 2005, 2004, 2003, 2002, and 2001.

Quartzs annual financial statements have been audited by its
current independent registered public accounting firm, Davidson and Company,
Chartered Accountants. The financial statements have been prepared in accordance
with Canadian generally accepted accounting principles (Canadian GAAP). Note
10 to the annual financial statements provides descriptions of the material
measurement differences between Canadian GAAP and United States generally
accepted accounting principles (US GAAP) as they relate to Quartz and
reconciliation of Quartzs financial statements to US GAAP.

|Balance Sheet                |  | As at July 31             |  
|---------------------------- |  | ------------------------- | -
|(in US$)                     |  | 2005                      |  
|                             |  |                           |  
|Total Assets                 |  |                           |  
|Canadian GAAP                |  | 687,281                   |  
|US
      GAAP(2)             |  | 687,280                   |  
|Total Liabilities            |  |                           |  
|Canadian GAAP                |  | 12,659                    |  
|US GAAP                      |  | 12,659                    |  
|Working Capital (Deficiency) |  |                           |  
|Canadian GAAP                |  | 674,621                   |  
|US
      GAAP                |  | 674,621                   |  
|Share Capital                |  |                           |  
|Canadian GAAP                |  | 20,726,303                |  
|US GAAP                      |  | 20,726,303                |  
|Contributed Surplus          |  |                           |  
|Canadian GAAP                |  | 54,540                    |  
|US
      GAAP                |  | 54,540                    |  
|Deficit                      |  |                           |  
|Canadian GAAP                |  | (20,106,221               | )
|US GAAP                      |  | (20,106,222               | )
|Shareholders Equity         |  |                           |  
|(Deficiency)                 |  |                           |  
|Canadian GAAP                |  | 674,622                   |  
|US
      GAAP                |  | 674,621                   |  
|                             |  |                           |  
|                             |  |                           |  
|Statement of Operations      |  | Years ended July
      31 |  
|(in US$)                     |  | 2005                      |  
|                             |  |                           |  
|Interest income              |  |                           |  
|Canadian GAAP                |  | 15,127                    |  
|US
      GAAP                |  | 15,127                    |  
|Income (loss)                |  |                           |  
|Canadian GAAP                |  | (85,405                   | )
|US GAAP(2)                   |  | (85,406                   | )

4

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|Statement of Operations |  | Years ended July 31 | 
|----------------------- |  | ------------------- | 
|(in US$)                |  | 2005                | 
|                        |  |                     | 

|Income (loss) from continuing |  |            |   |  |            |   |  |           |   |  |           |  |  |           |  
|----------------------------- |  | ---------- | - |  | ---------- | - |  | --------- | - |  | --------- |  |  | --------- | -
|operations                    |  |            |   |  |            |   |  |           |   |  |           |  |  |           |  
|Canadian GAAP                 |  | (85,405    | ) |  | (128,166   | ) |  | 7,885     |   |  | 459,843   |  |  | (51,651   | )
|US
      GAAP(2)              |  | (85,406    | ) |  | (115,251   | ) |  | (3,759    | ) |  | 458,572   |  |  | (51,651   | )
|Income (loss) per common      |  |            |   |  |            |   |  |           |   |  |           |  |  |           |  
|share(4)                      |  |            |   |  |            |   |  |           |   |  |           |  |  |           |  
|Canadian GAAP                 |  | (0.01      | ) |  | (0.01      | ) |  | 0.00      |   |  | 0.05      |  |  | (0.01     | )
|US GAAP(3)                    |  | (0.01      | ) |  | (0.01      | ) |  | 0.00      |   |  | 0.05      |  |  | (0.01     | )
|Weighted average number of    |  |            |   |  |            |   |  |           |   |  |           |  |  |           |  
|common shares outstanding     |  |            |   |  |            |   |  |           |   |  |           |  |  |           |  
|Canadian GAAP                 |  | 11,694,601 |   |  | 10,091,648 |   |  | 9,117,231 |   |  | 8,584,807 |  |  | 8,279,690 |  
|US
      GAAP                 |  | 11,694,601 |   |  | 10,091,648 |   |  | 9,117,231 |   |  | 8,584,807 |  |  | 8,279,690 |  

Notes:

|(1) | During the year ended July 31, 2005, the Company changed
      its accounting policy from capitalizing (deferring) mineral property
      expenditures to charging these costs to earnings in the period incurred.
      This change in accounting policy is applied retroactively and the amounts
      presented for these prior periods have been restated for this change. The
      effect of this change is to reduce loss for the year ended July 31, 2004
      by $8,086 and to reduce income for the year ended July 31, 2003 by $8,086.
      There was no impact to opening deficit for the year ended July 31, 2005.
      For more information, see note 4 in the notes to the audited consolidated
      financial statements for the years ended July 31, 2005, 2004 and
    2003.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(2) | The Company follows Canadian GAAP whereby mineral
      exploration expenditures can be deferred on prospective properties until
      such time as it is determined that further exploration is not warranted,
      at which time the property costs are written off. Under US GAAP
      exploration costs are generally written off unless there is a feasibility
      report which confirms the existence of economic ore making the recovery of
      costs likely. Note 10 of the audited consolidated financial statements
      provides descriptions of the material differences between Canadian GAAP
      and US GAAP for the fiscal years ended July 31, 2005, 2004 and
  2003.                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(3) | Statement of Financial Accounting Standards No. 128
      Earnings per Share(SFAS 128), replaces the presentation of
      primary earnings per share (EPS) with a presentation of both basic and
      diluted EPS for all entities with complex capital structures, including a
      reconciliation of each numerator and denominator.                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    | Basic EPS excludes dilutive securities and is computed by
      dividing income available to common stockholders by the weighted-average
      number of common shares outstanding for the year. Diluted EPS reflects the
      potential dilution that could occur if dilutive securities were converted
      into common stock and is computed similarly to fully diluted EPS pursuant
      to previous accounting pronouncement. SFAS 128 applied equally to loss per
      share presentations.                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(4) | The Company has never paid dividends on its common
      shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

The following foreign exchange information is provided for the
convenience of Canadian readers.

On November 30, 2005, the Bank of Canada closing rate for the
conversion of United States Dollars to Canadian Dollars (Cdn) was US$1.00:Cdn$
1.1669.

The following table sets out the average exchange rates for the
conversion of United States dollars into Canadian dollars for the periods shown
(calculated by using the average of the exchange rates on the last day of each
month in such periods), based on the noon buying rates as posted by the Bank of
Canada.

5

---

|                        | Average Exchange Rate For
      the Fiscal Year
|----------------------- | -----------------------------------------------
|Fiscal Year
      Ended |                                                
|July 31, 2005           | 1.2361                                         
|July 31, 2004           | 1.3355                                         
|July 31, 2003           | 1.4919                                         
|July 31, 2002           | 1.5722                                         
|July 31, 2001           | 1.5234                                         

The following table sets out the high and low exchange rates,
based on the noon buying rates as posted by the Bank of Canada, for the
conversion of United States dollars into Canadian dollars in effect for the
following months:

|Month          | High   | Low   
|-------------- | ------ | ------
|November 2005  | 1.1961 | 1.1657
|October 2005   | 1.1887 | 1.1659
|September 2005 | 1.1882 | 1.1611
|August 2005    | 1.2187 | 1.1889
|July 2005      | 1.2432 | 1.2051
|June 2005      | 1.2577 | 1.2256

B.     Capitalization and
Indebtedness

Not applicable.

C.     Reasons for the Offer and Use of
Proceeds

Not applicable.

D.     Risk Factors

The securities of Quartz are highly speculative and subject to
a number of risks. A prospective investor or other person reviewing Quartz for a
prospective investor should not consider an investment in Quartz unless the
investor is capable of sustaining an economic loss of the investment.

No Assurance That A Prospective Property Of Merit Will Be
Identified. There is no assurance that a prospective property of merit
will be identified, will be available if identified or that the Company will be
able to enter into an acquisition agreement. Further, any acquisition will most
likely be subject to the Company obtaining additional financing, of which there
is no assurance. Even if a property is acquired, further funds will be required
to fund exploration efforts.

The Companys Mineral Property Interests Contain No Known
Ore.The Company does not currently have an active exploration project,
but is searching for a new acquisition. The Company holds a 1% net smelter
return royalty (NSR) on the Quartz Mountain Property, an exploration stage
prospect in Oregon. The Companys interest in the property will be limited to
any future NSR that would be forthcoming if or when any mining commences on the
property. There is currently no known body of commercially viable ore on the
property. Extensive additional exploration work will be required to ascertain if
any mineralization may be economic. Exploration for minerals is a speculative
venture necessarily involving substantial risk. There is no certainty that the
expenditures to be made by the Company on any of its mineral properties will
result in discoveries of commercial quantities of ore.

The Company Has No History of Earnings and No Foreseeable
Earnings.The Company has no history of earnings and, due to the nature
of its business, there can be no assurance that the Company will ever be
profitable. The Company has paid no dividends on its shares since incorporation
and does not anticipate paying dividends or being profitable in the foreseeable
future.

6

---

Going Concern Assumption. The Companys
consolidated financial statements have been prepared assuming the Company will
continue on a going concern basis. However, unless additional funding is
obtained, this assumption will have to change. The Company has incurred losses
since inception (deficit at July 31, 2005 was approximately $20.1 million),
which casts substantial doubt on the ability of the Company to continue as a
going concern.

General Mining Risks.If the Company should ever
determine ore exists on a property it acquires, then it notes that the mining
industry in general is intensely competitive and there is no assurance that,
even if commercial quantities of ore are discovered, a profitable market may
exist for the sale of minerals produced by the Company. Factors beyond the
control of the Company may affect the marketability of any substances
discovered. Mineral prices, in particular gold and silver prices, have
fluctuated widely in recent years. The marketability of minerals is also
affected by numerous other factors beyond the control of the Company. These
other factors include government regulations relating to price, royalties, and
allowable production and importing and exporting of minerals. The operations of
the Company may require licences and permits from various governmental
authorities. There can be no assurances that the Company will be able to obtain
all necessary licences and permits that may be required to carry out
exploration, development and eventually operations at its projects. The mineral
industry is intensely competitive in all its phases. The Company competes with
many companies possessing far greater financial resources and technical
facilities than itself for the acquisition of mineral concessions, claims,
leases and other mineral interests as well as for the recruitment and retention
of qualified employees.

The Companys Share Price is Volatile.The market
price of a publicly traded stock, especially a junior resource issuer like the
Company, is affected by many variables not directly related to the exploration
success of the Company, including the market in which it is traded, the strength
of the economy generally, the availability and attractiveness of alternative
investments, and the breadth of the public market for the stock. On February 17,
2005, the Company transferred its listing from Tier 2 of the TSX Venture
Exchange to NEX. NEX is a separate board of TSX Venture Exchange, established in
August 2003 to provide a new trading forum for listed companies that have fallen
below the TSX Venture Exchanges ongoing listing standards due to low levels of
business activity or having ceased to carry on active business. The effect of
these and other factors on the market price of the common shares on the NEX
suggests that the Companys shares will continue to be volatile. The ability of
the Company to reactivate itself as a Tier 2 Issuer on the TSX Venture Exchange
is dependent on its ability to acquire a mineral project for active
exploration.

The Companys Directors and Officers are Part-Time and
Serve as Directors and Officers of Other Companies.All of the directors
and officers of the Company serve as officers and/or directors of other resource
exploration companies and are engaged in and will continue to be engaged in the
search for additional resource opportunities on their own behalf and on behalf
of other companies. Situations may arise where these directors and officers will
be in direct competition with the Company. Such conflicts, if any, will be dealt
with in accordance with the relevant provisions of British Columbia corporate
and common law. In order to avoid the possible conflict of interest which may
arise between the directors duties to the Company and their duties to the other
companies on whose boards they serve, the directors and officers of the Company
expect that participation in exploration prospects offered to the directors will
be allocated between the various companies that they serve on the basis of
prudent business judgement and on the relative financial abilities and needs of
the companies to participate. The success of the Company and its ability to
continue to carry on operations is dependent upon its ability to retain the
services of certain key employees and members of its board of directors.

Foreign Jurisdiction Risks.The Companys
  activities could be subject not only to risks common to operations in the mining
  industry, but also the political and economic uncertainties of operating in
  a foreign jurisdiction. All laws may result in risk such as possible misinterpretation
  of laws, unilateral modification of mining or exploration rights, operating
  restrictions, increased taxes, environmental regulation, mine safety and other
  risks arising out of sovereignty over mining, any or all of which could have
  an adverse impact upon the Company. The Companys operations may also be
  affected in varying degrees by political and economic instability, terrorism,
  crime, extreme fluctuations in currency exchange rates and inflation. The Companys
  operations and exploration activities are subject to federal and state laws
  and regulations governing protection of the environment. These laws are continually
  changing and, as a general matter, are becoming more restrictive.

7

---

Likely PFIC Status Has Consequences for United States
  Investors.Potential investors who are United States (U.S.)
  taxpayers should be aware that the Company expects to be classified for U.S.
  tax purposes as a passive foreign investment company (PFIC) for
  the current fiscal year, and may also have been a PFIC in prior and may also
  be a PFIC in subsequent years. If the Company is a PFIC for any year during
  a U.S. taxpayers holding period, then such U.S. taxpayer generally will
  be required to treat any so-called excess distribution received
  on its common shares, or any gain realized upon a disposition of common shares,
  as ordinary income and to pay an interest charge on a portion of such distribution
  or gain, unless the taxpayer makes a qualified electing fund (QEF)
  election or a mark-to-market election with respect to the shares of the Company.
  In certain circumstances, the sum of the tax and the interest charge may exceed
  the amount of the excess distribution received, or the amount of proceeds of
  disposition realized, by the taxpayer. A U.S. taxpayer who makes a QEF election
  generally must report on a current basis its share of the Companys net
  capital gain and ordinary earnings for any year in which the Company is a PFIC,
  whether or not the Company distributes any amounts to its shareholders. A U.S.
  taxpayer who makes the mark-to-market election generally must include as ordinary
  income each year the excess of the fair market value of the common shares over
  the taxpayers tax basis therein. See also Item 10E  Passive Foreign
  Investment Company.

Shares of the Company may be Affected Adversely by Penny Stock Rules.The Companys stock may be subject to U.S. penny stock rules which may make the stock more difficult to trade on the open market. The Companys
common shares currently trade on the NEX Board of the TSX Venture Exchange. For further details on the market performance of the Companys common stock, see Item 9 The Offer and Listing.  Although the Companys common stock
trades on the NEX, the Companys stock may be subject to U.S. penny stock rules adopted by the United States Securities and Exchange Commission (the SEC) pursuant to section 15(g) of the Securities Exchange Act of
1934, as amended. The penny stock rules apply generally to companies whose common stock trades at less than $5.00 per share, subject to certain limited exemptions. Such rules require, among other things, that brokers who trade penny
stock to persons other than established customers complete certain documentation, make suitability inquiries of investors and provide investors with certain information concerning trading in the security, including a risk
disclosure document and quote information under certain circumstances.

Penny stock regulations will tend to reduce market liquidity of the Companys common stock, because they limit the broker/dealers ability to trade, and a purchasers ability to sell, the stock in the secondary market. Many brokers
have decided not to trade penny stock because of the requirements of the "penny stock rules" and, as a result, the number of broker-dealers willing to act as market makers in such securities is limited. Further, it is more difficult for
a company whose securities are subject to these rules to obtain coverage for significant news events because major wire services, such as the Dow Jones News Service, generally do not publish press releases about such companies.

The low price of the Companys common stock also has a negative effect on the amount and percentage of transaction costs paid by individual shareholders. The low price of the Companys common stock also limits the Companys ability to
raise additional capital by issuing additional shares.  There are several reasons for these effects.  First, the internal policies of certain institutional investors prohibit the purchase of low-priced stocks. Second, many brokerage houses do not
permit low-priced stocks to be used as collateral for margin accounts or to be purchased on margin. Third, some brokerage house policies and practices tend to discourage individual brokers from dealing in low-priced stocks. Finally, brokers
commissions on low-priced stocks usually represent a higher percentage of the stock price than commissions on higher priced stocks. As a result, the Companys shareholders pay transaction costs that are a higher percentage of their total share
value than if the Companys share price were substantially higher.

The rules described above concerning penny stocks may adversely affect the market liquidity of the Companys common shares. The Company can provide no assurances concerning the market liquidity of its stock or that its stock will not be subject
to penny stock rules.

Potential Equity Dilution. At November 30, 2005, the Company had no outstanding stock options and had a total of 1,510,000 share purchase warrants which were exercisable at a price of Cdn$0.37 until April 19, 2006. As a
consequence of the passage of time since the date of their original sale and issuance, no outstanding warrants of the Company remained subject to any hold period restrictions in Canada or the United States as of November 30, 2005. The eventual
resale of shares resulting from the exercise of dilutive securities could have a depressing effect on the market for the Companys shares. Dilutive securities represent approximately 12.7% of the Companys currently issued shares.

8

---

ITEM 4     INFORMATION ON THE
COMPANY

A.     History and Development of the
Company

|1. | The legal name of the Company is Quartz Mountain
      Resources Ltd.                                                                                                                                                                                                                                                                                                                                                                                                                
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|2. | Quartz Mountain Resources Ltd. was incorporated on August
      3, 1982, in British Columbia, Canada. The Company was originally
      incorporated as Wavecrest Resources Ltd., but changed its name to Quartz
      Mountain Gold Corp. on June 18, 1986. On November 5, 1997, the name of the
      Company was changed from Quartz Mountain Gold Corp. to Quartz Mountain
      Resources Ltd. and the shares were consolidated on a reverse ten old for
      one new share basis.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|3. | The Companys business office is located at Suite 1020 
      800 West Pender Street, Vancouver, British Columbia V6C 2V6; telephone
      (604) 684-6365. The Company was incorporated under and continues to
      subsist under the laws of the Province of British Columbia. The Companys
      registered office is Suite 1500  1055 West Georgia Street, Vancouver,
      British Columbia V6E 4N7; telephone (604) 689-
9111.                                                

Unless the context requires otherwise, references herein to the
Company or Quartz includes its subsidiaries. The Companys common shares
were quoted on the United States NASDAQ SmallCap Market until May 12, 1994 when
it ceased to meet the minimum listing requirements for this market. The
Companys common shares were listed on The Toronto Stock Exchange until November
10, 1994, when it ceased to meet the minimum listing requirements for listing on
The Toronto Stock Exchange. Prior to November 15, 1989, the shares were also
listed on the Vancouver Stock Exchange. The Company voluntarily removed its
share listing from the Vancouver Stock Exchange (now the TSX Venture Exchange)
at that time. The Company then traded in Canada on the Canadian Unlisted market.
In October 2000, the Canadian Unlisted market was amalgamated into, and became
Tier 3 of, the TSX Venture Exchange. On December 23, 2003, the Company was
reclassified as a Tier 2 company. On February 17, 2005, the Company transferred
its listing to NEX, a separate board of TSX Venture Exchange, established in
August 2003 to provide a new trading forum for listed companies that have fallen
below the TSX Venture Exchanges ongoing listing standards due to low levels of
business activity, or due to having ceased to carry on active business.
Currently, the Companys shares trade on NEX under the symbol QZM.H, and certain
broker-dealers in the United States make market in the Companys shares on the
OTC Bulletin Board under the symbol QZMRF.

The Company is engaged in the acquisition and exploration of
mineral properties, with a principal concentration on gold and silver. In the
first three years of its existence the Company was active in the exploration of
small gold and silver prospects in Canada but none of these prospects warranted
further development. In 1986, the Company acquired the Quartz Mountain gold
property located in south central Oregon and until January 2002 most of the
Companys effort was expended on the exploration and maintenance of these
claims. Interests in this property and other properties were acquired by direct
purchase, lease, and option or through joint ventures. The Company sold the
Quartz Mountain property during the fiscal year ended July 31, 2002, but
retained a 1% net smelter return (NSR) royalty on it.

B.     Business Overview

1.The
Companys Business Strategy and Principal Activities

The Company is a junior resource exploration issuer, and is in
the business of acquiring interests in (usually by option) and the exploration
of these mineral property interests. During the year ended July 31, 2002, the
Company sold its 100% interest in the Quartz Mountain Gold Property (the
Property), in Lake County, Oregon, to Seabridge Resources Ltd. and Seabridge
Resources Inc. (collectively Seabridge).

9

---

At closing, Seabridge issued 300,000 Seabridge common shares,
200,000 Seabridge common share purchase warrants, US$100,000 and a 1% NSR from
any future production on the Property. This transaction was approved by consent
of the majority of the Companys shareholders.

During fiscal 2002, the Company sold the 300,000 common shares
of Seabridge that it received in the disposition of its interest in the Quartz
Mountain property in Oregon and also exercised the 200,000 common share purchase
warrants that it received pursuant to that transaction. The Company subsequently
sold the common shares that it had acquired upon the exercise of the
warrants.

The Company does not expect to generate any royalty revenue
from the Property for several years, and it is not known at this time when any
mining will commence, if at all, on this Property. The Company maintained an
interest in 67 unpatented mining claims essential to the property and leased
land contiguous to these claims. Seabridge or any future owner of the Property
will be responsible for all costs relating to the Property and the Companys
interest in the Property is limited to any future NSR that would be forthcoming
if or when any mining commences on the Property.

In fiscal 2003, Quartz entered into a Letter Option Agreement
to acquire a 100% interest in the Ample-Goldmax Mineral Claims located in the
Lillooet Mining Division, British Columbia. Quartz paid the optionors Cdn$10,000
at the time of signing and issued 25,000 common shares on the date of regulatory
approval, and every three months thereafter for a period of three years (100,000
were issued), at the discretion of the Company. Cash payments of Cdn$25,000 were
due on the first anniversary and Cdn$50,000 on the second anniversary of the
approval date. A Cdn$100,000 work program within 24 months was also required.
During the nine months ended April 30, 2004, the Company did not make the first
anniversary payment of Cdn$25,000, and as a result, the property was written off
and returned to the vendor of the property.

The Company does not currently have an active exploration
project, but is searching for a new acquisition. During the fiscal year ended
July 31, 2005, the Company conducted property investigations of mineral property
interests for a total cost of approximately $27,000. Property investigation
costs include geological consulting and travel related to examination of mineral
properties. To date, mineral property investigations have not resulted in an
acquisition.

The Company continues to review mineral properties to determine
whether there are any properties of merit that could be financed by the Company.

The Company does not have any operating revenue and anticipates
that it will rely on sales of its equity securities in order to finance its
acquisition and exploration activities.

C.     Organizational Structure

The Company conducts its business affairs through its
wholly-owned subsidiaries: Quartz Mountain Gold Inc., a Nevada corporation, and
the latter companys wholly-owned subsidiary Wavecrest Resources Inc., a
Delaware corporation.

D.     Property, Plants and
Equipment

The Company has no mining or plant equipment.

E.     Currency

All currency amounts in this Annual Report are stated in United
States dollars unless otherwise indicated (see Item 3 for exchange rate
information).

10

---

ITEM 5     OPERATING AND FINANCIAL
REVIEW AND PROSPECTS

The following discussion and analysis should be read in
conjunction with the audited consolidated financial statements of the Company
for the years ended July 31, 2005, 2004 and 2003, and related notes thereto. The
Companys consolidated financial statements have been prepared in accordance
with Canadian generally accepted accounting principles. The material differences
in generally accepted accounting principles in Canada and the United States are
detailed in note 10 of the audited consolidated financial statements.

A.     Operating Results

Overview

The Company does not currently have an active exploration
project. Accordingly, during the fiscal year ended July 31, 2005, the Companys
activities were primarily restricted to conducting property investigations of
mineral property interests. These investigations did not lead to any
acquisitions.

The Company suffered a setback when Dr. David S. Jennings, the
Companys President, Chief Executive Officer and a Director, passed away
unexpectedly on May 15, 2005. Mr. Rene Carrier, a Director of the Company, was
appointed President on June 16, 2005. The Board of Directors is in the process
of identifying a suitable candidate (who may be an existing Director) to replace
Dr. Jennings as Chief Executive Officer.

Results of Operations

|                                                  |   | Year ended July
      31 |  
|------------------------------------------------- | - | ------------------------ | -
|                                                  |   | 2005                     |  
|                                                  |   |                          |  
|Expenses (Income)                                 |   |                          |  
|Administrative expenses                           | $ | 66,864                   |  
|Exploration(1)                                    |   | -                        |  
|Foreign exchange loss gain                        |   | (47,485                  | )
|Interest and other income                         |   | (15,127                  | )
|Land maintenance fees                             |   | -                        |  
|Mineral property investigations                   |   | 27,125                   |  
|Professional fees                                 |   | 35,505                   |  
|Regulatory and transfer agent                     |   | 18,523                   |  
|Write-down of mineral
      property interests(1) |   | -                        |  
|                                                  |   |                          |  
|Income (loss) for the year  Canadian GAAP        | $ | (85,405                  | )
|                                                  |   |                          |  
|US GAAP Reconciliation                            |   |                          |  
|Mineral property acquisition costs(2)             |   | (1                       | )
|Write-off of mineral
      property(2)            |   | -                        |  
|                                                  |   |                          |  
|Income (loss) for
      the year  US GAAP        | $ | (85,406                  | )

Notes:

|(1) | During the year ended July 31, 2005, the Company changed
      its accounting policy from capitalizing (deferring) mineral property
      expenditures to charging these costs to earnings in the period incurred.
      This change in accounting policy was applied retroactively. The effect of
      this change was to reduce loss for the year ended July 31, 2004 by $8,086
      and to reduce income for the year ended July 31, 2003 by $8,086. There was
      no impact to opening deficit for the year ended July 31,
  2005.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

11

---

|(2) | Under Canadian GAAP, mineral property acquisition costs,
      and exploration and development expenditures incurred subsequent to the
      determination of the feasibility of mining operations, are capitalized
      until the property to which they relate have been placed into production,
      sold, allowed to lapse or abandoned (See note 3(d) in the notes to the
      audited consolidated financial statements for the years ended July 31,
      2005, 2004 and 2003 for more information). In contrast, under US GAAP,
      mineral property expenditures are expensed as incurred. (See note 10(a) of
      the notes to the audited consolidated financial statements for the years
      ended July 31, 2005, 2004 and 2003 for more
information).
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Years ended July 31, 2005 and July 31, 2004

Loss for the year ended July 31, 2005 decreased to $85,405 from
$128,166, on a restated basis, in fiscal 2004 due to a $15,210 write-down of
mineral property interest relating to the Ample-Goldmax property in fiscal 2004
and greater foreign exchange gains in fiscal 2005. Legal, accounting and audit
costs and office and administration expenses were higher in fiscal 2005 compared
to 2004 as a result of property investigation activities undertaken by the
Company in 2005.

The increase in foreign exchange gains for the year ended July
31, 2005 was due mainly to the strengthening of the Canadian dollar (in which
most of the Companys cash and cash equivalent are held) against the United
States dollar.

Interest income for the year ended July 31, 2005 was higher
than the comparative year due to higher cash balances on hand.

Years ended July 31, 2004 and July 31, 2003

The principal factors contributing to the difference between
the loss of $128,166 for the year ended July 31, 2004, and earnings of $7,885
for the year ended July 31, 2003, in each case on a restated basis, include:

- An increase in office and administrative costs from $10,434 in fiscal 2003
  to $62,963, due to payment of consulting fees and reimbursement of costs
  incurred of $40,580, with no comparative expense in fiscal 2003;
- An increase in mineral property investigation costs from $nil in fiscal
  2003 to $44,848 in fiscal 2004, as a result of new investigations undertaken
  by the Company in its efforts to acquire a new mineral property;
- An increase in regulatory and transfer agent costs from $17,023 in fiscal
  2003 to $22,338, due to the fees related to mineral property interests and/or
  investigation activities, stock exchange fees and other securities fees;
- The write-off of the Companys interest in the Ample-Goldmax mineral
  property (Newton Hill) amounting to $15,210, on a restated basis, during the
  year ended July 31, 2004; and
- A decrease in foreign exchange gain from $40,487 in fiscal 2003 to $22,225
  due primarily to the strengthening of the Canadian dollar (in which most of
  the Companys cash and cash equivalents are held) against the United States
  dollar.

B.     Liquidity and Capital
Resources

At July 31, 2005, the Company had working capital of
approximately $675,000 which is sufficient to fund expected administrative costs
for the next twelve months and to conduct property acquisition investigation
activities. Additional working capital will be required to fund any major
acquisition, in the event that a suitable property is identified. The Company
does not have sufficient funding at this time to conclude a major acquisition.
Any new mineral property acquisition will require additional financing through
the issuance of common shares.

Cash and cash equivalents at July 31, 2005 amounted to $670,755,
  a decrease of $15,631 from the previous year ended July 31, 2004, when the Companys
  cash and cash equivalents amounted to $686,386. Operating activities in fiscal
  2005 utilized cash of $104,810, offset in part by $89,179 in cash received upon
  the exercise of 711,111 share purchase warrants in November 2004. These warrants
  constituted part of the 711,111 units issued in a non-brokered private placement
  during the year ended July 31, 2003, to Hunter Dickinson Inc., a private company
  with certain directors in common with the Company.

12

---

Historically, the Company's sole source of funding has been the
  issuance of equity securities for cash, primarily through private placements
  or the exercise of warrants. The Company's access to exploration financing is
  always uncertain, and there can be no assurance of continued access to significant
  equity funding.

The mining industry is capital intensive, and there can be no
certainty that the Companys existing cash balances or that the proceeds from
the sale of its common shares will provide sufficient funds for all of the
Companys cash requirements. Should the need arise, the Company may pursue other
financing options or rely on joint venture partners to supply some of the funds
required to explore and develop any properties that may eventually be acquired.
There is no assurance that the Company will be successful in obtaining adequate
financing when it is needed, or that it would be able to obtain any such
financing on terms that are reasonably acceptable to the Company.

The Company retains a 1% net smelter return royalty in the
Quartz Mountain Property which it sold during the year ended July 31, 2002. The
Company does not expect to generate royalty revenue from the Quartz Mountain
Property for several years, and it is not known at this time when any mining
will commence, if at all, on this property. The size of the property is limited
to 67 unpatented mining claims essential to the property and leased land
contiguous to these claims. Seabridge Resources Ltd., the purchaser, is
responsible for all costs relating to the Quartz Mountain Property, and the
Companys interest in the property will be limited to any future NSR that would
be forthcoming if or when any mining commences on the Quartz Mountain
Property.

As at November 30, 2005, the Company does not have any unused
banking commitments or lines of credit, which could provide additional working
capital. Any new acquisition must rely financing such as the sale of common
shares to provide sufficient working capital.

The Company is in the exploration and development stage and has
not earned any revenue from mining operations and no revenue is expected to be
generated in the foreseeable future.

The Company has no long-term debt, capital lease obligations,
operating leases or any other long-term obligations.

The Company has no Purchase Obligations defined as any
agreement to purchase goods or services that is enforceable and legally binding
on the Company that specifies all significant terms, including: fixed or minimum
quantities to be purchased; fixed, minimum or variable price provisions; and the
approximate timing of the transaction.

Financial Instruments

The Company holds its financial instruments predominantly
denominated in Canadian dollars and does not engage in any hedging operations
with respect to currency or in-situ minerals. Funds which are currently in
excess of the Companys current expenditures are invested in low risk, highly
liquid investments with original maturations of three months or less.

The Company does not have any material commitments for capital
expenditures and, accordingly, can remain relatively flexible in gearing its
activities to the availability of funds.

The Company estimates that the cost of maintaining its
corporate administrative activities is approximately $130,000 per year, if the
Company does not commence any exploration programs on any property which it
acquires. This is an estimated minimum annual cost to maintain the Company. Any
exploration program would require funds above these minimum administration costs
which include office, legal, audit, filing, and transfer agent fees.

C.     Research Expenditures

The Company does not have a program of intellectual property
development or patenting or licensing issues as its primary activity is the
acquisition and exploration of mineral properties.

13

---

D.     Trend Information

Average prices for precious metals have increased significantly
from 2004. The average gold price for the year-to-date is US$430/oz. compared to
US$399/oz in 2004. The Companys only property interest is a net smelter royalty
in an exploration property which is a gold prospect. However, since the
exploration property has no known body of commercially viable ore, the Company
expects that the increasing trend in gold prices will have little or no impact
on the Companys ability to attract significant equity financing.

E.     Off  Balance Sheet
Arrangements

The Company does not have any off-balance sheet arrangements
that have or are reasonably likely to have a current or future effect on its
financial condition, changes in financial condition, revenues or expenses,
results of operations, liquidity, capital expenditures or capital resources that
is material to investors. As used in this Item 5.E., the term off-balance sheet
arrangement means any transaction, agreement or other contractual arrangement to
which an entity unconsolidated with the company is a party, under which the
company has:

|(a) | Any obligation under a guarantee contract that has any of
      the characteristics identified in paragraph 3 of FASB Interpretation No.
      45, Guarantors Accounting and Disclosure Requirements for Guarantees,
      Including Indirect Guarantees of Indebtedness of Others (November 2002)
      (FIN 45), as may be modified or supplemented, excluding the types of
      guarantee contracts described in paragraphs 6 and 7 of FIN 45;                                                                              
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(b) | A retained or contingent interest in assets transferred
      to an unconsolidated entity or similar arrangement that serves as credit,
      liquidity or market risk support to such entity for such assets;                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(c) | Any obligation under a derivative instrument that is both
      indexed to the companys own stock and classified in stockholders equity,
      or not reflected, in the companys statement of financial position;
    or                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(d) | Any obligation, including a contingent obligation,
      arising out of a variable interest (as referenced in FASB Interpretation
      No. 46, Consolidation of Variable Interest Entities (January 2003), as may
      be modified or supplemented) in an unconsolidated entity that is held by,
      and material to, the company, where such entity provides financing,
      liquidity, market risk or credit risk support to, or engages in leasing,
      hedging or research and development services with, the
  company.

F.     Tabular Disclosure of Contractual
Obligations

Payments due by periodContractual
      Obligations
      Total
      Less than 1 year
      1-3
      years
      3-5
      years
      More than 5 yearsLong-Term Debt Obligations
    Nil
    Nil
    Nil
    Nil
    NilCapital Finance/Lease
    Nil
    Nil
    Nil
    Nil
    NilOperating Lease
    Nil
    Nil
    Nil
    Nil
    NilPurchase Obligations
    Nil
    Nil
    Nil
    Nil
    NilOther long-term liabilities reflected on the
      Companys balance sheet under the GAAP of the primary financial
      statements
    Nil
    Nil
    Nil
    Nil
    NilTotal
    Nil
    Nil
    Nil
    Nil
    Nil


14

---

ITEM 6     DIRECTORS, SENIOR MANAGEMENT
AND EMPLOYEES

A.     Directors and Senior
Management

The following table sets forth the names, ages, functions and
areas of experience in the Company of each of the Companys directors and senior
officers:

Name, Position(s) with the Company and
      Place of Residence
    Functions and Area of
      Experience with the CompanyRene G. Carrier President and Director
      North Vancouver, British Columbia, Canada
    Director since January 19, 2000. Mr. Carrier serves on
      the Board of Directors, which is responsible for the overall management
      and direction of the Company.Brian F. Causey Director Tsawwassen,
      British Columbia, Canada
    Director since January 30, 2003. Mr. Causey serves on the
      Board of Directors, which is responsible for the overall management and
      direction of the Company.Gordon J. Fretwell Secretary and Director
      West Vancouver, British Columbia, Canada
    Director since January 30, 2003. Mr. Fretwell serves on
      the Board of Directors, which is responsible for the overall management
      and direction of the Company. Mr. Fretwell also serves as the secretary of
      the Company, and is responsible for maintaining the Companys corporate
      records in such capacity.T. Barry Coughlan Director Vancouver,
      British Columbia, Canada
    Director since January 25, 2005. Mr. Coughlan serves on
      the Board of Directors, which is responsible for the overall management
      and direction of the Company.


Directors are elected to serve until the next annual meeting of
shareholders. Executive officers are appointed by the Board of Directors to
serve until terminated by the Board of Directors or until their successors are
appointed.

There are no family relationships between any director,
executive officer or any nominee to be a director or executive officer.

There is no arrangement or understanding with major
shareholders or others pursuant to which any director or officer was selected as
a director or member of senior management.

RENE G. CARRIER  President, Director

Mr. Carrier is a past Vice-President
  of Pacific International Securities Inc. for ten years where he worked until
  1991. Since that time he has been President of Euro-American Capital Corporation,
  a private company which specializes in restructuring and raising venture capital
  funds for junior companies. Mr. Carrier is an officer and/or director of the
  following public companies:

Company
      Position(s) Held
      From
      ToChartwell Technology Inc.
      Director
      June 1991
      PresentRockwell Ventures Inc.
      Director 
        President
      April 1993 
        April 1993
      Present 
        November 2000Quartz Mountain
        Resources Ltd.
      Director
        
        President
      January
        2000 
        June 2005
      Present
        
        PresentAcrex Ventures Ltd.
      Director
      September 2000
      September 2003Continental Minerals
        Corporation
      Director
      February
        2001
      PresentInternational Royalty Corporation
      Lead Director
      June 2003
      Present


BRIAN CAUSEY, B.Comm., C.A. - Director

Mr. Causey holds a B.Comm. degree and
  was admitted to the Institute of Charted Accountants of British Columbia in
  1971. Formerly a partner of Peat Marwick Thorne (now KPMG LLP) (1969-1977),
  Mr. Causey is currently director of Project Finance for Hunter Dickinson
  Inc., a position he was appointed to in 2001. Mr. Causey was within the
  past five years, an officer of the following public companies:

15

---

Company
      Position(s) Held
      From
      ToZenith Transport Ltd.
      President and Chief
        Executive Officer
      1981
      2001Quartz Mountain Resources Ltd.
      Director
      January 2003
      Present


T. BARRY COUGHLAN, B.A. - Director

T. Barry Coughlan is a self-employed
  businessman and financier who over the past 23 years has been involved in the
  financing of publicly traded companies. His principal occupation is President
  and Director of TBC Investments Ltd., a private investment company. Mr. Coughlan
  is, or was within the past 5 years, an officer and or a director of the following
  companies:

Company
      Position(s) Held
      From
      ToTri-Gold Resources Corp.
        
        (formerly Tri-Alpha 
        Investments Ltd.)
      President and Director
      June 1986
      PresentIcon Industries Ltd.
      President, CEO and Director
      September 1991
      PresentCasamiro Resource Corp
      Director
      February 1995
      August 2002Farallon Resources Ltd.
      Director
      March 1998
      PresentGreat Basin Gold Ltd.
      Director
      February 1998
      PresentTaseko Mines Limited
      Director
      February 2001
      PresentAMS Homecare Inc.
      Director
      November 2001
      November 2004Quartz Mountain Resources Ltd.
      Director
      January 2005
      Present


GORDON J. FRETWELL, B.Comm. LLB.  Director, Secretary

Gordon J. Fretwell holds a B.Comm, degree
  and graduated from the University of British Columbia in 1979 with his Bachelor
  of Law degree. Formerly a partner in a large Vancouver law firm, Mr. Fretwell
  has, since 1991, been a self-employed solicitor (Gordon Fretwell Law Corporation)
  in Vancouver practicing primarily in the areas of corporate and securities law.
  Mr. Fretwell is, or was within the past five years, an officer and/or director
  of the following public companies:

| | COMPANY                        | Position(s) Held             | From           | To            
| | ------------------------------ | ---------------------------- | -------------- | --------------
| | Rockwell Ventures Inc.         | Director and
      Secretary | March 1998     | Present       
| | Copper Ridge Explorations Inc. | Director and Secretary       | September 1999 | Present       
|
| | Antarex Metals Ltd.            | Director                     | December 2000  | September 2002

| | Icon Industries Limited              | Vice
      President of Legal 
      Services 
      Director | December
      2000 
      July 2004            | Present
      
      Present                     
| | ------------------------------------ | ------------------------------------------------------------- | ----------------------------------------------- | -------------------------------------------------
|
|
| | Continental Minerals Corporation     | Director                                                      | February 2001                                   | Present                                          
|
| | Bell Resources Corporation           | Director                                                      | June
      2001                                 | Present                                          
|
| | Tri-Gold Resources Corp.             | Director 
      Secretary 
      CFO                          | July 2001 
      July 2001 
      November 2005 | October 2003 
      September 2003 
      Present
|
|
| | Grandcru Resources Corp.             | Director                                                      | December
      2002                             | Present                                          
|
| | Quartz Mountain Resources Ltd.       | Director                                                      | January 2003                                    | Present                                          
|
| | Pine Valley Mining Corp.             | Director                                                      | August
      2003                               | Present                                          
|
| | Keegan Resources Inc.                | Director                                                      | February 2004                                   | Present                                          
| | Northern Dynasty Minerals
      Ltd. | Director                                                      | June
      2004                                 | Present                                          
|
| | International Royalty Corporation    | Director                                                      | February 2005                                   | Present                                          
|

B.     Compensation

Named Executive Officer means each the Chief Executive
Officer, the Chief Financial Officer and each of the three most highly
compensated executive officers (other than each Chief Executive Officer and
Chief Financial Officer) who were serving as executive officers at the end of
the most recently completed fiscal year and whose total salary and bonus exceeds
$150,000 and any additional individuals for whom disclosure would have been
provided except that the individual was not serving as an officer of the Company
at the end of the most recently completed financial year end.

16

---

At July 31, 2005, Mr. Rene Carrier, the Companys President and
Mr. Jeffrey R. Mason, the Companys Principal Accounting Officer, were the
Named Executive Officers of the Company. Dr. David S. Jennings, the Companys
former President, Chief Executive Officer and Director, passed away unexpectedly
on May 15, 2005, and Mr. Carrier was appointed to replace him on June 16, 2005.
Ms. Shannon M. Ross served as the Companys Chief Financial Officer until her
resignation on January 21, 2005. Mr. Mason has been serving as the Companys
Principal Accounting Officer since January 22, 2005.

A total of Cdn$3,691 in cash compensation was paid for services
provided by these Named Executive Officers in all capacities to the Company
during the year ended July 31, 2005. Included in this amount is Cdn$700 paid for
consulting services to a private company controlled by Mr. Carrier.

Directors of the Company do not receive any fee or other
compensation for attending meetings of the Board of Directors. The Directors are
however, reimbursed for actual expenses incurred in connection with attending
such meetings. Directors are eligible to receive options to purchase common
shares of the Company.

The Company has not set aside or accrued any funds during the
last fiscal year to provide pension, retirement or similar benefits for any
director, officer, consultant, or employee. The Company has instituted no
pension or retirement benefits and none are proposed at this time.

There are no other arrangements under which directors are or
were compensated by the Company and its subsidiaries during the most recently
completed financial year for their services in their capacity as directors or
consultants. The compensation, in Canadian dollars, paid to the Named Executive
Officers during the Companys three most recently completed financial years is
set out below:

Summary Compensation Table (in Cdn$)

NAMED EXECUTIVE 
        OFFICERS 
        Name and Principal Position
      Year
      Annual Compensation
      Long Term Compensation
      All Other 
        Compensation 
        (Cdn$)Awards
      PayoutsSalary 
        (Cdn$)
      Bonus 
        (Cdn$)
      Other 
        Annual 
        Compen-  
        sation 
        (Cdn$)
      Securities 
        Under Options 
        Granted 
        (#)
      Shares or 
        Units 
        Subject to 
        Resale 
        Restrictions 
        (Cdn$)
      LTIP 
        Payouts 
        (Cdn$)David S. Jennings, PhD(1)
        Former President and Chief 
        Executive Officer
      2005 
        2004 
        2003
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil l 
        Nil 
        Nil
      Nil 
        Nil 
        NilRene G. Carrier (2)
        Current President and 
        Director
      2005 
        2004 
        2003
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      700 (3)
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        NilShannon M. Ross (4)
        Former Vice-President, 
        Secretary and Chief 
        Financial Officer
      2005 
        2004 
        2003
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        50,000 (6)
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        NilJeffrey R. Mason (5)
        Principal Accounting Officer
      2005 
        2004 
        2003
      2,991 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil
      Nil 
        Nil 
        Nil


Notes:

|(1) | David S. Jennings passed away on May 15, 2005.                                                                                                               
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Rene G. Carrier was appointed President of the Company on
      June 16, 2005.                                                                               
|(3) | This amount represents US$571 paid to Euro-American
      Capital Corporation, a private company controlled by Rene G. Carrier for
      management services.
|(4) | Shannon M. Ross resigned as Vice-President, Secretary and
      Chief Financial Officer on January 21, 2005.                                                 
|(5) | Jeffrey R. Mason has been Principal Accounting Officer
      since January 22, 2005.                                                                         
|(6) | These amounts represent amounts paid to 583559 B.C. Ltd.,
      a private company controlled by Shannon M. Ross, for consulting
      services.              

Stock Options

The Company has adopted a stock option plan for the granting
  of incentive stock options to the officers, employees and directors. The Company
  presented an amendment to the plan which was approved by shareholders at the
  Companys annual general meeting held in January 2004 pursuant to the rules
  of the TSX Venture Exchange.

17

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There are no options outstanding under the current plan at this
  time. The purpose of granting such options is to assist the Company in compensating,
  attracting, retaining and motivating the directors of the Company and to closely
  align the personal interests of such persons to that of the shareholders.

Stock options are a significant component of the compensation
received by directors and serve to provide incentive to such individuals to act
in the best interests of the Company and its shareholders.

There were no options granted during the most recently
completed financial year.

The Named Executive Officers did not exercise any options
during the most recently completed financial year.

Long-Term Incentive Plan

The Company does not have a long-term incentive plan pursuant
to which cash or non-cash compensation intended to serve as an incentive for
performance (whereby performance is measured by reference to financial
performance or the price of the Companys securities) was paid.

The Company and its subsidiaries have no employment contracts
with any Named Executive Officer.

The Company and its subsidiaries have no compensatory plan or
arrangement in respect of compensation received or that may be received by the
Named Executive Officers in the Companys most recently completed or current
financial year to compensate such executive officers in the event of the
termination of employment (resignation, retirement, change of control) or in the
event of a change in responsibilities following a change in control.

C.     Board Practices

All directors, other than Ms. Shannon Ross (who did not stand
for re-election) and Mr. Barry Coughlan (who was appointed in January 2005),
were re-elected at the last annual and extraordinary general meeting held on
January 21, 2005, and have a term of office expiring at the next annual general
meeting of the Company expected to be held in January 2006. One of the
directors, Dr. David Jennings passed away unexpectedly during his term of
office. All officers have a term of office lasting until their removal or
replacement by the Board of Directors.

The Company and its subsidiaries have no directors service
contracts providing for benefits upon termination of employment.

The Company has no compensation or remuneration committee.

The Board of Directors has appointed an Audit Committee and the
current members of that committee are Messrs. Gordon J. Fretwell, Brian F.
Causey and Rene G. Carrier.

Audit Committee

The Board has adopted a charter for the Audit Committee to
follow in carrying out its audit and financial review functions. The text of the
audit committee charter (excluding specified definitions of independence and
financial literacy under stock exchange policies and securities law) is attached
as a schedule to this Registration Statement. The Audit Committee reviews all
financial statements of the Company prior to their publication, reviews audits,
considers the adequacy of audit procedures, recommends the appointment of
independent auditors, reviews and approves the professional services to be
rendered by them and reviews fees for audit services. The Board has established
definitions for financial literacy and has determined that all members of the
Audit Committee are financially literate. The Audit Committee meets separately
(without management present) with the Companys auditors to discuss the various
aspects of the Companys financial statements and the independent audit.

18

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D.     Employees

At July 31, 2005, and each of the past three years, the Company
has had no employees and has contracted staff on an as-needed basis. The
directors of the Company primarily administer the Companys functions through
the employees of Hunter Dickinson Inc., a private company with certain directors
in common with the Company.

E.     Share Ownership

(a)    Share Ownership

At November 30, 2005, there were 11,889,426 common shares,
1,510,000 share purchase warrants and no stock options issued and outstanding.
The share purchase warrants are immediately exercisable at a price of CAD$0.37
until April 19, 2006. Directors and officers of the Company held the following
securities of the Company at November 30, 2005:

Name and Office Held
    Securities Beneficially
      Owned(1)
    As a percentage of
      outstanding sharesRene G. Carrier President and Director
    110,000 common shares 110,000
      warrants(2)
    0.9%Brian F. Causey Director
    Nil
    NilGordon J. Fretwell Secretary and Director
    Nil
    NilT. Barry Coughlan Director
    Nil
    Nil


Notes:

|(1) | This information has been provided by the individual
      directors as provided by them on www.sedi.ca                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Rene G. Carrier holds warrants to purchase a total of
      110,000 Common Shares at an exercise price of $0.37, which expire on April
      19, 2006.

(b)     Share Purchase Plan and Share
Option Plan

A stock option plan pursuant to the rules of the TSX Venture
Exchange was presented to and approved by shareholders at the Companys Annual
General Meeting held on January 21, 2004. On February 17, 2005, the Company
transferred its listing from Tier 2 of the TSX Venture Exchange to NEX, a
separate board of the TSX Venture Exchange. Therefore, the stock option plan is
subject to certain policies of the TSX Venture Exchange that apply only to
companies listed on the NEX board. Details of the plan are presented below.

Share Option Plan

In order to provide incentive to directors, officers, employees,
  management and others who provide services to the Company to act in the best
  interests of the Company, management of the Company proposed, and shareholders
  adopted a new share option plan (the Plan) in January 2004. Under
  the Plan, a total of up to 1,900,000 shares of the Company have been reserved
  for share incentive options to be granted at the discretion of the Companys
  board of directors to eligible optionees (the "Optionees"). At the date of this
  Form 20-F there are no options outstanding pursuant to this plan.

19

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Eligible Optionees

Under the policies of TSX Venture Exchange (TSX-V), to be
eligible for the issuance of a stock option under the Plan an Optionee must
either be a director, officer, employee, consultant or an employee of a company
providing management or other services to the Company or its subsidiary at the
time the option is granted.

Options may be granted only to an individual or to a company
that is wholly-owned by individuals eligible for an option grant. If the option
is granted to a company, the company must provide TSX-V with an undertaking that
it will not permit any transfer of its Shares, nor issue further Shares, to any
other individual or entity as long as the incentive stock option remains in
effect without the consent of TSX-V.

Material Terms of the Plan

The following is a summary of the material terms of the Plan:

|(a) | all options granted under the Plan are non-assignable and
      non-transferrable and for a period of up to 5 years;                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) | for stock options granted to employees or service
      providers (inclusive of management company employees), the Company is
      required to represent that the proposed Optionee is a bona fide employee
      or service provider (inclusive of a management company employee), as the
      case may be, of the Company or of any of its subsidiaries;                                                                                                                                                                                                     
|(c) | if an Optionee ceases to be employed by the Company
      (other than as a result of termination with cause) or ceases to act as a
      director or officer of the Company or a subsidiary of the Company, any
      option held by such Optionee may be exercised within 90 days after the
      date such Optionee ceases to be employed as an officer or director or, as
      the case may be, or within 30 days if the Optionee is engaged in investor
      relations activities and ceases to be employed to provide investor
      relations activities;
|(d) | the minimum exercise price of an option granted under the
      Plan must not be less than the Discounted Market Price (as defined in the
      policies of TSX-V); and                                                                                                                                                                                                                                                                                                                                                                                          
|(e) | no Optionee can be granted an option or options to
      purchase more than 5% of the outstanding listed Shares of the Company in a
      one year period.                                                                                                                                                                                                                                                                                                                                                                                                       

Equity Compensation Plan Information

Number of securities
      to be issued upon exercise of outstanding
      options, warrants and rights
    Weighted-average exercise price of outstanding
      options, warrants and rights
    Number of securities
      remaining available for future issuance under equity
      compensation plans (excluding securities reflected in
      column (a))Plan Category
    (a)
    (b)
    (c)Equity compensation plans approved by
      securityholders  share option plan (the Plan)
    Nil
    Nil
    1,900,000Equity compensation plans not approved by
      security holders
    Nil
    Nil
    NilTotal
    Nil
    Nil
    1,900,000


20

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ITEM 7     MAJOR SHAREHOLDERS AND
RELATED PARTY TRANSACTIONS

A.     Major Shareholders

Quartz is a publicly-held corporation, with its shares held by
residents of Canada, the United States of America and other countries. To the
best of its knowledge, the Company is not directly or indirectly owned or
controlled by a corporation or foreign government. As of November 30, 2005, the
Company has authorized an unlimited number of common shares without par value,
of which 11,889,426 were issued and outstanding.

The following table sets forth certain information with respect
to beneficial ownership of the Companys common stock as of November 30, 2005,
by (i) each shareholder known to be the beneficial owner of more than 5% of the
common stock and (ii) the officers and directors as a group indirectly, by any
other corporation or by any foreign government. For these purposes, beneficial
ownership means the sole or shared power to vote or direct the voting or to
dispose or direct the disposition of any security.

Percentage BeneficiallyIdentity of
      Person or Group
    Shares
    Owned of ClassEstate of David S. Jennings (1)
    3,895,292
    32.7%Hunter Dickinson Inc.(2)
    1,422,222
    12.0%Robert A. Dickinson
    1,313,900
    11.1%


Notes:

|1. | Dr. Jennings passed away on May 15, 2005. At the time of
      his death, he was the President, Chief Executive Officer and a director of
      the Company.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|2. | Hunter Dickinson Inc. is a private company with certain
      directors and officers in common.                                                             

The Companys major shareholders do not have any different
voting rights than other shareholders.

Transfer Agent

The Companys securities are recorded on the books of its
transfer agent, Computershare Trust Company of Canada located at 4th Floor, 510
Burrard Street, Vancouver, B.C. V6C 3B9; telephone (604) 661-0271 in registered
form. However, the majority of such shares are registered in the name of
intermediaries such as brokerage houses and clearing houses (on behalf of their
respective brokerage clients). Quartz does not have knowledge or access to the
identities of the beneficial owners of such shares registered through
intermediaries.

Control

To its knowledge, the Company is not owned or controlled,
directly or indirectly, by any other corporation or foreign government, and
there are no other arrangements which may, at a subsequent date, result in a
change in control of the Company.

All other known shareholders with greater than 5% are brokerage
clearinghouses.

As of November 30, 2005, directors and officers of the Company
as a group (four persons) owned or controlled an aggregate of 110,000 common
shares (less than 1%) of the Company.

21

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Insider Reports under the British Columbia Securities
Act

Under the British Columbia Securities Actinsiders
(generally officers, directors, holders of 10% or more of the Company's shares)
are required to file insider reports of changes in their ownership within 10
days of a trade in the Company's securities. Electronic copies of such reports
are available for public inspection via the System of Electronic Disclosure for
Insiders (or SEDI) established by the applicable Canadian securities regulatory
authorities, and accessible from the SEDI website (www.sedi.ca).

Geographic Breakdown of Shareholders

The following lists the geographical distribution of
shareholders at November 30, 2005:

Number of registeredLocation
    shareholders
    Number of sharesCanada
    34
    10,213,751United States
    1,547
    1,437,121Other
    14
    238,554Total
    1,595
    11,889,426


Shares registered in intermediaries were assumed to be held by
residents of the same country in which the clearing-house was located.

B.     Related Party
Transactions

During the year ended July 31, 2005, the Company entered into
the following transactions with related parties:

|(a) | The Company has paid $57,732 (2004 - $19,776; 2003 -
      $17,010) to Hunter Dickinson Inc. (HDI), a private company with certain
      directors in common with the Company, for rent and administrative
      services, professional fees and geological costs.                                                                                                                                                                          
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | In November 2004, HDI exercised previously issued share
      purchase warrants and purchased 711,111 common shares at a price of
      Cdn$0.15 per share. These share purchase warrants had been issued as part
      of a private placement offering of 711,111 units completed during the year
      ended July 31, 2003 at a price of  Cdn$0.1125 per unit. Each unit
      consisted on one common share and one share purchase warrant.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(b) | The Company has paid $571 (2004 - $606; 2003 - $2,065)
      for consulting services to a director.                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(c) | The Company paid $nil (2004 - $40,580; 2003 - $nil) in
      consulting fees and reimbursement of expenses to a private company
      controlled by a former director and officer of the Company. In fiscal
      2003, the Company paid $3,863 in legal fees to a law firm in which a
      director is a partner.                                                                                                                           

The amounts charged to the Company for the services provided
have been determined by negotiation among the parties and, in certain cases, are
covered by signed agreements. These transactions were in the normal course of
operations and were measured at the exchange value, which represented the amount
of consideration established and agreed to by the related parties.

Other than disclosed herein, no director or senior officer, and
no associate or affiliate of the foregoing persons, and no insider has or has
had any material interest, direct or indirect, in any transactions, or in any
other proposed transaction, during the year ended July 31, 2005.

C.     Interests of Experts and
Counsel

Not applicable.

22

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ITEM 8     FINANCIAL INFORMATION

A.     Consolidated Statements and Other
Financial Information

See Item 17 Financial Statements.

Legal Proceedings

The Company is not involved in any litigation or legal
proceedings and to the Companys knowledge, no material legal proceedings
involving the Company or its subsidiaries are to be initiated against the
Company.

Dividend Policy

The Company has not paid any dividends on its outstanding
common shares since its incorporation and does not anticipate that it will do so
in the foreseeable future. All funds of the Company are being retained for
administration expenses and mineral property investigations.

B.     Significant Changes

The Company had no significant changes in its activities during
the year ended July 31, 2005.

23

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ITEM 9     THE OFFER AND LISTING

A.     Offer and Listing Details

1.     Trading
Markets

The following table sets forth trading data on the Companys
common shares on Tier 2 on the TSX Venture Exchange until February 17, 2005, and
thereafter on the NEX board of the TSX Venture Exchange:

|Fiscal |                | Period ended           | High   | Low   
|------ | -------------- | ---------------------- | ------ | ------
|Year   |                |                        | (Cdn$) | (Cdn$)
|       | Annual         |                        |        |       
|2005   | Twelve months  | To July 31, 2005       | 0.68   | 0.23  
|2004   | Twelve months  | To July 31,
      2004 | 0.55   | 0.14  
|2003   | Twelve months  | To July 31, 2003       | 0.28   | 0.10  
|2002   | Twelve months  | To July 31,
      2002 | 0.20   | 0.04  
|2001   | Twelve months  | To July 31, 2001       | 0.25   | 0.10  
|       |                |                        |        |       
|       | By Quarter     |                        |        |       
|2006   | First quarter  | October 31, 2005       | 0.40   | 0.30  
|2005   | Fourth quarter | July 31, 2005          | 0.37   | 0.23  
|       | Third quarter  | April 30, 2005         | 0.41   | 0.27  
|       | Second quarter | January 31, 2005       | 0.51   | 0.38  
|       | First quarter  | October 31, 2004       | 0.68   | 0.36  
|       |                |                        |        |       
|2004   | Fourth quarter | July 31, 2004          | 0.55   | 0.45  
|       | Third quarter  | April 30, 2004         | 0.50   | 0.365 
|       | Second quarter | January 31, 2004       | 0.40   | 0.21  
|       | First quarter  | October 31, 2003       | 0.25   | 0.145 
|       |                |                        |        |       
|       | Monthly        |                        |        |       
|       | November 2005  |                        | 0.36   | 0.33  
|       | October 2005   |                        | 0.40   | 0.31  
|       | September 2005 |                        | 0.31   | 0.31  
|       | August 2005    |                        | 0.31   | 0.30  
|       | July 2005      |                        | 0.37   | 0.25  
|       | June 2005      |                        | 0.27   | 0.23  

The Companys share trading information is also available
  through free Internet search services (eghttp://finance.yahoo.com, enter QZM-H.V). The trading
  prices on the OTC Bulletin Board are similar to the Canadian prices allowing
  for a currency exchange factor. Trading on the OTC Bulletin Board (under the
  symbol QZMRF) had a 52 week high to November 30, 2005, of US$0.35 and a 52 week
  low of US$0.185. The closing price on the OTC Bulletin Board on November 30,
  2005, was US$0.281. The 52-week trading range ending on November 30, 2005, on
  the TSX Venture Exchange and NEX ranges from Cdn$0.23 to Cdn$0.47.

24

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B.     Plan of Distribution

Not applicable

C.     Markets

Prior to February 17, 2005, the Companys common shares were
listed and traded in Canada on Tier 2 on the TSX Venture Exchange, under the
symbol QZM.V. The transition to Tier 2 became effective December 23, 2003. Prior
to this, the Company traded on Tier 3 on the TSX Venture Exchange, under the
symbol YQZT.V.

On February 17, 2005, the Company transferred its listing to
NEX, a separate board of TSX Venture Exchange, established in August 2003 to
provide a new trading forum for listed companies that have fallen below the TSX
Venture Exchanges ongoing listing standards due to low levels of business
activity, or due to having ceased to carry on active business. Currently, the
Companys common shares trade on NEX under the symbol QZM.H, and certain
broker-dealers in the United States make market in the Companys shares on the
OTC Bulletin Board under the symbol QZMRF.

There are currently no limitations imposed by Canadian federal
or provincial laws on the rights of non-resident or foreign owners of Canadian
securities to hold or vote the securities held. There are no such limitations
imposed by the Companys Notice of Articles, Articles or contracts of which the
management of the Company is aware.

D.     Selling Shareholders

Not applicable.

E.     Dilution

Not applicable.

F.     Expenses of the Issue

Not applicable.

25

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ITEM 10     ADDITIONAL
INFORMATION

A.     Share Capital

Not applicable.

B.     Memorandum and Articles of
Association

Background

The British Columbia Business Corporations Act came into
force on March 29, 2004. As a result, the British Columbia Company Act-
which governed the Company up to that time - was repealed, and the Company
became a pre-existing company subject to the provisions of the new Act and the
Pre-Existing Company Provisions set forth in Table 3 to the British Columbia
Business Corporations Regulation. The Company's incorporation number was
varied slightly by adding the prefix "BC0", so that it is now BC0253743.

The Pre-Existing Company Provisions carry over certain
requirements that the Company was subject to under the former Company Act(British Columbia). For example, they provide that the majority of votes
required for a pre-existing company to pass a special resolution at a general
meeting of shareholders is 3/4 of the votes cast on that resolution. A copy of
the Pre-Existing Company Provisions may be viewed during normal business hours
at the office of the Companys solicitors, Lang Michener LLP, at 1500  1055
West Georgia Street, Vancouver, British Columbia.

Every pre-existing company is required to file a Transition
Application containing a Notice of Articles with the British Columbia Registrar
of Companies, as a result of which the Notice of Articles will be deemed to
supersede and replace the companys Memorandum. A pre-existing company that
fails to file a Transition Application containing a Notice of Articles no later
than March 29, 2006 is subject to dissolution. Further, a pre-existing company
that has not transitioned itself under the new Act may not effect any changes to
its Memorandum (which is analogous to Articles of Incorporation of many U.S.
companies) or Articles (which are analogous to corporate bylaws).

Once a company has filed the Transition Application containing
a Notice of Articles, it can amend its corporate charter with the requisite
shareholder approval to take advantage of certain provisions of the new
Business Corporations Act that are intended to give greater flexibility
to companies in terms of corporate governance. For example:

- a company may amend its articles to specify the level of shareholder
  approval required to pass a special resolution at a meeting of shareholders,
  provided the required level of approval is at least 2/3 and not more than 3/4
  of the votes cast;
- a company may amend its authorized share structure to provide for an
  unlimited number of authorized shares; and
- a company may hold its own shares instead of returning them to treasury,
  and a subsidiary company may hold the shares of its parent company.

Filing of Transition Application

On October 11, 2005, the Company caused a Transition
Application to be filed with the Registrar of Companies, as authorized by
directors resolutions adopted December 1, 2004. The new Business
Corporations Act does not permit a company to make any changes to its
charter as part of the filing of the Transition Application. Therefore, the
information contained in the Companys Transition Application reflected the
current status of the Company at the time of its filing, including the Companys
authorized capital, its existing Articles, and the mandatory

26

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application of the Pre-Existing Company Provisions. Information
respecting the Companys then authorized share capital and its Articles has been
previously disclosed in the Companys Annual Report on Form 20-F dated January
28, 2003.

Alteration to Notice of Articles

At the annual general meeting of the Company held on January
21, 2005, the Companys shareholders adopted special resolutions to change the
number of common shares that the Company is authorized to issue from 60,000,000
to an unlimited number. On October 11, 2005, the Company caused a Notice of
Alteration to be filed with the British Columbia Registrar of Companies, thereby
altering the Companys Notice of Articles to give effect to this change to the
authorized share structure of the Company. As a result, the Company is now
authorized to issue an unlimited number of common shares without par value.

C.     Material Contracts

Hunter Dickinson Inc. ("HDI") is a private company with certain
directors in common with the Company that provides geological, technical,
corporate development, administrative and management services to, and incur
third party costs on behalf of, the Company on a full cost recovery basis
pursuant to an agreement dated December 31, 1996.

D.     Exchange Controls

The Company is a Province of British Columbia, Canada
corporation. There is no law or governmental decree or regulation in Canada that
restricts the export or import of capital, or affects the remittance of
dividends, interest or other payments to a non-resident holder of Common Shares,
other than withholding tax requirements. Any such remittances to United States
residents are generally subject to withholding tax, however no such remittances
are likely in the foreseeable future. See Taxation, below.

There is no limitation imposed by the laws of Canada or by the
charter or other constituent documents of the Company on the right of a
non-resident to hold or vote the Common Shares, other than as provided in the
Investment Canada Act (Canada) (the Investment Act). The following
discussion summarizes the material features of the Investment Act for a
non-resident who proposes to acquire a controlling number of the Companys
Common Shares. It is general only, it is not a substitute for independent advice
from an investors own advisor, and it does not anticipate statutory or
regulatory amendments. The Company does not believe the Investment Act will have
any affect on it or on its non-Canadian shareholders due to a number of factors
including the nature of its operations and the Companys relatively small
capitalization.

The Investment Act generally prohibits implementation of a reviewable
  investment by an individual, government or agency thereof, corporation, partnership,
  trust or joint venture (each an entity) that is not a Canadian
  as defined in the Investment Act (a non-Canadian), unless after
  review the Director of Investments appointed by the minister responsible for
  the Investment Act is satisfied that the investment is likely to be of net benefit
  to Canada. The size and nature of a proposed transaction may give rise to an
  obligation to notify the Director to seek an advance ruling. An investment in
  the Common Shares by a non-Canadian (other than a WTO Investor as
  that term is defined in the Investment Act and which term includes entities
  which are nationals of or are controlled by nationals of member states of the
  World Trade Organization) when the Company was not controlled by a WTO Investor,
  would be reviewable under the Investment Act if it was an investment to acquire
  control of the Company and the value of the assets of the Company, as determined
  in accordance with the regulations promulgated under the Investment Act, was
  over a certain figure, or if an order for review was made by the federal cabinet
  on the grounds that the investment related to Canadas cultural heritage
  or national identity, regardless of the value of the assets of the Company.
  An investment in the Common Shares by a WTO Investor, or by a non-Canadian when
  the Company was controlled by a WTO Investor, would be reviewable under the
  Investment Act if it was an investment to acquire control of the Company and
  the value of the assets of the Company, as determined in accordance with the
  regulations promulgated under the Investment Act, was not less than a specified
  amount, which for 2005 exceeds CAD$250 million. A non-Canadian would acquire
  control of the Company for the purposes of the Investment Act if the non-Canadian
  acquired a majority of the Common Shares. The acquisition of less than a majority
  but one-third or more of the Common Shares would be presumed to be an acquisition
  of control of the Company unless it could be established that, on the acquisition,
  the Company was not controlled in fact by the acquiror through the ownership
  of the Common Shares.

27

---

The foregoing assumes the Company will not engage in the production
  of uranium or own an interest in a producing uranium property in Canada, or
  provide any financial service or transportation service, as the rules governing
  these businesses are different.

Certain transactions relating to the Common Shares would be
exempt from the Investment Act, including:

| | (a) | an acquisition of the Common Shares by a person in the
      ordinary course of that persons business as a trader or dealer in
      securities,                                                                                                                                           
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                             
| | (b) | an acquisition of control of the Company in connection
      with the realization of security granted for a loan or other financial
      assistance and not for a purpose related to the provisions of the
      Investment Act, and                                                       
| |     |                                                                                                                                                                                                                                                                                             
| | (c) | an acquisition of control of the Company by reason of an
      amalgamation, merger, consolidation or corporate reorganization following
      which the ultimate direct or indirect control in fact of the Company,
      through the ownership of the Common Shares, remained
  unchanged.

E.     Taxation

Certain Canadian Federal Income Tax Consequences

The discussion under this heading summarizes the principal
Canadian federal income tax consequences of acquiring, holding and disposing of
shares of common stock of Quartz for a shareholder of Quartz who is not a
resident of Canada but is a resident of the United States and who will acquire
and hold shares of common stock of Quartz as capital property for the purposes
of the Income Tax Act (Canada) (the Canadian Tax Act). This summary
does not apply to a shareholder who carries on business in Canada through a
permanent establishment situated in Canada or performs independent personal
services in Canada through a fixed base in Canada if the shareholders holding
in Quartz is effectively connected with such permanent establishment or fixed
base. This summary is based on the provisions of the Canadian Tax Act and the
regulations thereunder and on an understanding of the administrative practices
of Canada Revenue Agency, and takes into account all specific proposals to amend
the Canadian Tax Act or regulations made by the Minister of Finance of Canada as
of the date hereof. It has been assumed that there will be no other relevant
amendment of any governing law although no assurance can be given in this
respect. This discussion is general only and is not, nor is it intended to
provide a detailed analysis of the income tax implications of any particular
shareholders interest. Investors are advised to obtain independent advice from
a shareholders own Canadian and U.S. tax advisors with respect to income tax
implications pertinent to their particular circumstances.

The provisions of the Canadian Tax Act are subject to income
tax treaties to which Canada is a party, including the Canada-United States
Income Tax Convention (1980), as amended (the Convention).

Dividends on Common Shares and Other Income

Under the Canadian Tax Act, a non-resident of Canada is
generally subject to Canadian withholding tax at the rate of 25 percent on
dividends paid or deemed to have been paid to him or her by a corporation
resident in Canada. Quartz is responsible for withholding of tax at the source.
The Convention limits the rate to 15 percent if the shareholder is a resident of
the United States and the dividends are beneficially owned by and paid to such
shareholder and to 5 percent if the shareholder is also a corporation that
beneficially owns at least 10 percent of the voting stock of the payor
corporation.

The amount of a stock dividend (for tax purposes) would
generally be equal to the amount by which the paid up or stated capital of
Quartz had increased by reason of the payment of such dividend. Quartz will
furnish additional tax information to shareholders in the event of such a
dividend. Interest paid or deemed to be paid on Quartzs debt securities held by
non-Canadian residents may also be subject to Canadian withholding tax,
depending upon the terms and provisions of such securities and any applicable
tax treaty.

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The Convention generally exempts from Canadian income tax
dividends paid to a religious, scientific, literary, educational or charitable
organization or to an organization constituted and operated exclusively to
administer a pension, retirement or employee benefit fund or plan, if the
organization is a resident of the United States and is exempt from income tax
under the laws of the United States.

Dispositions of Common Shares

Under the Canadian Tax Act, a taxpayers capital gain or
capital loss from a disposition of a share of common stock of Quartz is the
amount, if any, by which his or her proceeds of disposition exceed (or are
exceeded by, respectively) the aggregate of his or her adjusted cost base of the
share and reasonable expenses of disposition. The capital gain or loss must be
computed in Canadian currency using a weighted average adjusted cost base for
identical properties. The capital gains net of losses included in income are as
follows. For gains net of losses realized before February 28, 2000, as to 75%.
For gains net of losses realized after February 27, 2000 and before October 18,
2000, as to 66 2/3%. For gains net of losses realized after October 17, 2000, as
to 50%. There are special transitional rules to apply capital losses against
capital gains that arose in different periods. The amount by which a
shareholders capital loss exceeds the capital gain in a year may be deducted
from a capital gain realized by the shareholder in the three previous years or
any subsequent year, subject to certain restrictions in the case of a corporate
shareholder.

Under the Canadian Tax Act, a non-resident of Canada is subject
to Canadian tax on taxable capital gains, and may deduct allowable capital
losses, realized on a disposition of taxable Canadian property. Shares of
common stock of Quartz will constitute taxable Canadian property of a
shareholder at a particular time if the shareholder used the shares in carrying
on business in Canada, or if at any time in the five years immediately preceding
the disposition 25% or more of the issued shares of any class or series in the
capital stock of Quartz belonged to one or more persons in a group comprising
the shareholder and persons with whom the shareholder and persons with whom the
shareholder did not deal at arms length and in certain other circumstances.

The Convention relieves United States residents from liability
for Canadian tax on capital gains derived on a disposition of shares unless

(a) the value of the shares is derived
principally from real property in Canada, including the right to explore for
or exploit natural resources and rights to amounts computed by reference to
production,

(b) the shareholder was resident in
Canada for 120 months during any period of 20 consecutive years preceding, and
at any time during the 10 years immediately preceding, the disposition and the
shares were owned by him when he or she ceased to be resident in Canada, or

(c) the shares formed part of the
business property of a permanent establishment that the holder has or had in
Canada within the 12 months preceding the disposition.

United States Tax Consequences

United States Federal Income Tax Consequences

The following is, in the opinion of Quartz after consultation
with its professional advisors, a discussion of material United States federal
income tax consequences, under current law, generally applicable to a U.S.
Holder (as hereinafter defined) of common shares of Quartz. This discussion does
not address all potentially relevant federal income tax matters and it does not
address consequences peculiar to persons subject to special provisions of
federal income tax law, such as those described below as excluded from the
definition of a U.S. Holder. In addition, this discussion does not cover any
state, local or foreign tax consequences, (see Taxation  Canadian Federal
Income Tax Consequences above). Accordingly, holders and prospective holders of
common shares of Quartz are urged to consult their own tax advisors about the
specific federal, state, local, and foreign tax consequences to them of
purchasing, owning and disposing of common shares of Quartz, based upon their
individual circumstances.

The following discussion is based upon the sections of the
Internal Revenue Code of 1986, as amended (the Code), Treasury Regulations,
published Internal Revenue Service (IRS) rulings, published administrative
positions of the IRS and court decisions that are currently applicable, any or
all of which could be materially and

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adversely changed, possibly on a retroactive basis, at any time and which are subject to differing interpretations. This discussion does not consider the potential effects, both adverse and beneficial, of any proposed legislation which, if enacted,
could be applied, possibly on a retroactive basis, at any time.

U.S. Holders

As used herein, a U.S. Holder means a holder of common shares of Quartz who is a citizen or individual resident of the United States, a corporation or partnership created or organized in or under the laws of the United States or of any
political subdivision thereof, an entity created or organized in or under the laws of the United States or of any political subdivision thereof which has elected to be treated as a corporation for United States federal income tax purposes (under
Treasury Regulation Section 301.7701 -3), an estate whose income is taxable in the United States irrespective of source or a trust subject to the primary supervision of a court within the United States and control of a United States fiduciary as
described in Section 7701(a)(30) of the Code. This summary does not address the tax consequences to, and U.S. Holder does not include, persons subject to specific provisions of federal income tax law, such as tax-exempt organizations, qualified
retirement plans, individual retirement accounts and other tax-deferred accounts, financial institutions, insurance companies, real estate investment trusts, regulated investment companies, broker-dealers, non-resident alien individuals, persons or
entities that have a functional currency other than the U.S. dollar, shareholders subject to the alternative minimum tax, shareholders who hold common shares as part of a straddle, hedging or conversion transaction, and shareholders who
acquired their common shares through the exercise of employee stock options or otherwise as compensation for services. This summary is limited to U.S. Holders who own common shares as capital assets and who own (directly and indirectly, pursuant to
applicable rules of constructive ownership) no more than 5% of the value of the total outstanding stock of Quartz. This summary does not address the consequences to a person or entity holding an interest in a shareholder or the consequences to a
person of the ownership, exercise or disposition of any options, warrants or other rights to acquire common shares. In addition, this summary does not address special rules applicable to United States persons (as defined in Section 7701(a)(30) of
the Code) holding common shares through a foreign partnership or to foreign persons holding common shares through a domestic partnership.

Distribution on Common Shares of Quartz

In general, U.S. Holders receiving dividend distributions (including constructive dividends) with respect to common shares of Quartz are required to include in gross income for United States federal income tax purposes the gross amount of such
distributions, equal to the U.S. dollar value of such distributions on the date of receipt (based on the exchange rate on such date), to the extent that Quartz has current or accumulated earnings and profits, without reduction for any Canadian
income tax withheld from such distributions. Such Canadian tax withheld may be credited, subject to certain limitations, against the U.S. Holders federal income tax liability or, alternatively, may be deducted in computing the U.S.
Holders federal taxable income by those who itemize deductions.  (See more detailed discussion at Foreign Tax Credit below). To the extent that distributions exceed current or accumulated earnings and profits of Quartz, they will
be treated first as a return of capital up to the U.S. Holders adjusted basis in the common shares and thereafter as gain from the sale or exchange of property. Preferential tax rates for long-term capital gains are applicable to a U.S. Holder
that is an individual, estate or trust.  There are currently no preferential tax rates for long-term capital gains for a U.S. Holder which is a corporation.

In the case of foreign currency received as a dividend that is not converted by the recipient into U.S. dollars on the date of receipt, a U.S. Holder will have a tax basis in the foreign currency equal to its U.S. dollar value on the date of
receipt.  Generally any gain or loss recognized upon a subsequent sale or other disposition of the foreign currency, including the exchange for U.S. dollars, will be ordinary income or loss. However, an individual whose realized gain does not exceed
$200 will not recognize that gain, provided that there are no expenses associated with the transaction that meet the requirements for deductibility as a trade or business expense (other than travel expenses in connection with a business trip) or
as an expense for the production of income.

Dividends paid on the common shares of Quartz generally will
  not be eligible for the dividends received deduction provided to corporations
  receiving dividends from certain United States corporations. A U.S. Holder which
  is a corporation and which owns shares representing at least 10% of the voting
  power and value of Quartz may, under certain circumstances, be entitled to a
  70% (or 80% if the U.S. Holder owns shares representing at least 20% of the
  voting power and value of Quartz) deduction of the United States source portion
  of dividends received from Quartz (unless Quartz qualifies as a foreign
  personal holding company or a passive foreign investment company,
  as defined below). Quartz does not anticipate that it will earn any United States
  income, however, and therefore does not anticipate that any U.S. Holder will
  be eligible for the dividends received deduction.

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Under current Treasury Regulations, dividends paid on Quartzs common shares, if any, generally will not be subject to information reporting and generally will not be subject to U.S. backup withholding tax.  However, dividends and the proceeds
from a sale of Quartzs common shares paid in the U.S. through a U.S. or U.S. related paying agent (including a broker) will be subject to U.S. information reporting requirements and may also be subject to the 30.5% U.S. backup withholding tax,
unless the paying agent is furnished with a duly completed and signed Form W-9. Any amounts withheld under the U.S. backup withholding tax rules will be allowed as a refund or a credit against the U.S. Holders U.S. federal income tax
liability, provided the required information is furnished to the IRS.

Foreign Tax Credit

A U.S. Holder who pays (or has withheld from distributions) Canadian income tax with respect to the ownership of common shares of Quartz may be entitled, at the option of the U.S. Holder, to either receive a deduction or a tax credit for such
foreign tax paid or withheld. Generally, it will be more advantageous to claim a credit because a credit reduces United States federal income taxes on a dollar-for-dollar basis, while a deduction merely reduces the taxpayers income subject to
tax. This election is made on a year-by-year basis and generally applies to all foreign taxes paid by (or withheld from) the U.S. Holder during that year. There are significant and complex limitations which apply to the credit, among which is the
general limitation that the credit cannot exceed the proportionate share of the U.S. Holders United States income tax liability that the U.S. Holders foreign source income bears to his or its worldwide taxable income. In the
determination of the application of this limitation, the various items of income and deduction must be classified into foreign and domestic sources.  Complex rules govern this classification process.  In addition, this limitation is calculated
separately with respect to specific classes of income such as passive income, high withholding tax interest, financial services income, shipping income, and certain other classifications of income.
Dividends distributed by Quartz will generally constitute passive income or, in the case of certain U.S. Holders, financial services income for these purposes. The availability of the foreign tax credit and the application of
the limitations on the credit are fact specific, and U.S. Holders of common shares of Quartz should consult their own tax advisors regarding their individual circumstances.

Disposition of Common Shares of Quartz

In general, U.S. Holders will recognize gain or loss upon the sale of common shares of Quartz equal to the difference, if any, between (i) the amount of cash plus the fair market value of any property received, and (ii) the shareholders tax
basis in the common shares of Quartz. Preferential tax rates apply to long-term capital gains of U.S. Holders that are individuals, estates or trusts. In general, gain or loss on the sale of common shares of Quartz will be long-term capital gain or
loss if the common shares are a capital asset in the hands of the U.S. Holder and are held for more than one year.  Deductions for net capital losses are subject to significant limitations.  For U.S. Holders that are not corporations, any unused
portion of such net capital loss may be carried over to be used in later tax years until such net capital loss is thereby exhausted.  For U.S. Holders that are corporations (other than corporations subject to Subchapter S of the Code), an unused net
capital loss may be carried back three years and carried forward five years from the loss year to be offset against capital gains until such net capital loss is thereby exhausted.

Other Considerations

Set forth below are certain material exceptions to the above-described general rules describing the United States federal income tax consequences resulting from the holding and disposition of common shares:

Foreign Personal Holding Company

If at any time during a taxable year more than 50% of the total combined voting power or the total value of Quartzs outstanding shares is owned, directly or indirectly (pursuant to applicable rules of constructive ownership), by five or fewer
individuals who are citizens or residents of the United States and 60% or more of Quartzs gross income for such year is derived from certain passive sources (e.g., from certain interest and dividends), Quartz may be treated as a foreign
personal holding company. In that event, U.S. Holders that hold common shares would be required to include in gross income for such year their allocable portions of such passive income to the extent Quartz does not

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actually distribute such income. Quartz does not believe that it currently qualifies as a foreign personal holding company.  However, there can be no assurance that Quartz will not be considered a foreign personal holding company for the current or
any future taxable year.

Foreign Investment Company

If 50% or more of the combined voting power or total value of Quartzs outstanding shares is held, directly or indirectly, by citizens or residents of the United States, United States domestic partnerships or corporations, or estates or trusts
other than foreign estates or trusts (as defined by Code Section 7701(a)(31)), and Quartz is found to be engaged primarily in the business of investing, reinvesting, or trading in securities, commodities, or any interest therein, it is possible that
Quartz may be treated as a foreign investment company as defined in Section 1246 of the Code, causing all or part of any gain realized by a U.S. Holder selling or exchanging common shares to be treated as ordinary income rather than
capital gain. Quartz does not believe that it currently qualifies as a foreign investment company. However, there can be no assurance that Quartz will not be considered a foreign investment company for the current or any future taxable year.

Passive Foreign Investment Company

United States income tax law contains rules governing passive foreign investment companies (PFIC) which can have significant tax effects on U.S. Holders of foreign corporations. These rules do not apply to non-U.S. Holders.
Section 1297 of the Code defines a PFIC as a corporation that is not formed in the United States if, for any taxable year, either (i) 75% or more of its gross income is passive income, which includes interest, dividends and certain rents
and royalties or (ii) the average percentage, by fair market value (or, if the corporation is not publicly traded and either is a controlled foreign corporation or makes an election, by adjusted tax basis), of its assets that produce or are held for
the production of passive income is 50% or more. Quartz appears to have been a PFIC for the fiscal year ended May 31, 2005, and at least certain prior fiscal years. In addition, Quartz expects to qualify as a PFIC for the fiscal year
ending May 31, 2006 and may also qualify as a PFIC in future fiscal years. Each U.S. Holder of Quartz is urged to consult a tax advisor with respect to how the PFIC rules affect such U.S. Holders tax situation.

Each U.S. Holder who holds stock in a foreign corporation during any year in which such corporation qualifies as a PFIC is subject to United States federal income taxation under one of three alternative tax regimes at the election of such U.S.
Holder. The following is a discussion of such alternative tax regimes applied to such U.S. Holders of Quartz. In addition, special rules apply if a foreign corporation qualifies as both a PFIC and a controlled foreign corporation (as
defined below) and a U.S. Holder owns, actually or constructively, 10% or more of the total combined voting power of all classes of stock entitled to vote of such foreign corporation (See more detailed discussion at Controlled Foreign
Corporation below).

A U.S. Holder who elects to treat Quartz as a qualified electing fund (QEF) will be subject, under Section 1293 of the Code, to current federal income tax for any taxable year to which the election applies in which Quartz qualifies as a
PFIC on his pro rata share of Quartzs (i) net capital gain (the excess of net long-term capital gain over net short-term capital loss), which will be taxed as long-term capital gain, and (ii) ordinary earnings (the
excess of earnings and profits over net capital gain), which will be taxed as ordinary income, in each case, for the shareholders taxable year in which (or with which) Quartzs taxable year ends, regardless of whether such amounts are
actually distributed. A U.S. Holders tax basis in the common shares will be increased by any such amount that is included in income but not distributed.

The procedure a U.S. Holder must comply with in making an
  effective QEF election, and the consequences of such election, will depend on
  whether the year of the election is the first year in the U.S. Holders
  holding period in which Quartz is a PFIC. If the U.S. Holder makes a QEF election
  in such first year, i.e., a timely QEF election, then the U.S. Holder
  may make the QEF election by simply filing the appropriate documents at the
  time the U.S. Holder files his tax return for such first year. If, however,
  Quartz qualified as a PFIC in a prior year during the U.S. Holders holding
  period, then, in order to avoid the Section 1291 rules discussed below, in addition
  to filing documents, the U.S. Holder must elect to recognize under the rules
  of Section 1291 of the Code (discussed herein), (i) any gain that he would otherwise
  recognize if the U.S. Holder sold his stock on the qualification date or (ii)
  if Quartz is a controlled foreign corporation, the U.S. Holders pro rata
  share of Quartzs post-1986 earnings and profits as of the qualification
  date. The qualification date is the first day of Quartzs first tax year
  in which Quartz qualified as a QEF with respect to such U.S. Holder. For purposes
  of this discussion, a U.S. Holder who makes (i) a timely QEF election, or (ii)
  an untimely QEF election and either of

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the above-described gain-recognition elections under Section
  1291 is referred to herein as an Electing U.S. Holder. A U.S. Holder
  who holds common shares at any time during a year of Quartz in which Quartz
  is a PFIC and who is not an Electing U.S. Holder (including a U.S. Holder who
  makes an untimely QEF election and makes neither of the above-described gain-recognition
  elections) is referred to herein as a Non-Electing U.S. Holder.
  An Electing U.S. Holder (i) generally treats any gain realized on the disposition
  of his Company common shares as capital gain; and (ii) may either avoid interest
  charges resulting from PFIC status altogether, or make an annual election, subject
  to certain limitations, to defer payment of current taxes on his share of Quartzs
  annual realized net capital gain and ordinary earnings subject, however, to
  an interest charge. If the U.S. Holder is not a corporation, any interest charge
  imposed under the PFIC regime would be treated as personal interest
  that is not deductible.

In order for a U.S. Holder to make (or maintain) a valid QEF election, Quartz must provide certain information regarding its net capital gains and ordinary earnings and permit its books and records to be examined to verify such information. Quartz
intends to make the necessary information available to U.S. Holders to permit them to make (and maintain) QEF elections with respect to Quartz.  Quartz urges each U.S. Holder to consult a tax advisor regarding the availability of, and procedure for
making, the QEF election.

A QEF election, once made with respect to Quartz, applies to the tax year for which it was made and to all subsequent tax years, unless the election is invalidated or terminated, or the IRS consents to revocation of the election. If a QEF election
is made by a U.S. Holder and Quartz ceases to qualify as a PFIC in a subsequent tax year, the QEF election will remain in effect, although not applicable, during those tax years in which Quartz does not qualify as a PFIC. Therefore, if Quartz again
qualifies as a PFIC in a subsequent tax year, the QEF election will be effective and the U.S. Holder will be subject to the rules described above for Electing U.S. Holders in such tax year and any subsequent tax years in which Quartz qualifies as a
PFIC. In addition, the QEF election remains in effect, although not applicable, with respect to an Electing U.S. Holder even after such U.S. Holder disposes of all of his or its direct and indirect interest in the shares of Quartz. Therefore, if
such U.S. Holder reacquires an interest in Quartz, that U.S. Holder will be subject to the rules described above for Electing U.S. Holders for each tax year in which Quartz qualifies as a PFIC.

In the case of a Non-Electing U.S. Holder, special taxation rules under Section 1291 of the Code will apply to (i) gains realized on the disposition (or deemed to be realized by reasons of a pledge) of his Quartz common shares and (ii) certain
excess distributions, as defined in Section 1291(b), by Quartz.

A Non-Electing U.S. Holder generally would be required to pro rate all gains realized on the disposition of his Quartz common shares and all excess distributions on his Quartz common shares over the entire holding period for the common shares. All
gains or excess distributions allocated to prior years of the U.S. Holder (excluding any portion of the holders period prior to the first day of the first year of Quartz (i) which began after December 31, 1986, and (ii) for which Quartz was a
PFIC) would be taxed at the highest tax rate for each such prior year applicable to ordinary income. The Non-Electing U.S. Holder also would be liable for interest on the foregoing tax liability for each such prior year calculated as if such
liability had been due with respect to each such prior year. A Non-Electing U.S. Holder that is not a corporation must treat this interest charge as personal interest which, as discussed above, is wholly non-deductible. The balance, if
any, of the gain or the excess distribution will be treated as ordinary income in the year of the disposition or distribution, and no interest charge will be incurred with respect to such balance. In certain circumstances, the sum of the tax and the
PFIC interest charge may exceed the amount of the excess distribution received, or the amount of proceeds of disposition realized, by the U.S. Holder.

If Quartz is a PFIC for any taxable year during which a Non-Electing U.S. Holder holds Quartz common shares, then Quartz will continue to be treated as a PFIC with respect to such Quartz common shares, even if it is no longer definitionally a PFIC.
A Non-Electing U.S. Holder may terminate this deemed PFIC status by electing to recognize gain (which will be taxed under the rules discussed above for Non-Electing U.S. Holders) as if such Quartz common shares had been sold on the last day of the
last taxable year for which it was a PFIC.

Effective for tax years of U.S. Holders beginning after December 31, 1997, U.S. Holders who hold (actually or constructively) marketable stock of a foreign corporation that qualifies as a PFIC may elect to mark such stock to the market annually (a
mark-to-market election). If such an election is made, such U.S. Holder will generally not be subject to the special taxation rules of Section 1291 discussed above. However, if the mark-to-market election is

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made by a Non-Electing U.S. Holder after the beginning of the holding period for the PFIC stock, then the Section 1291 rules will apply to certain dispositions of, distributions on and other amounts taxable with respect to Quartz common shares. A
U.S. Holder who makes the mark-to-market election will include in income for each taxable year for which the election is in effect an amount equal to the excess, if any, of the fair market value of the common shares of Quartz as of the close of such
tax year over such U.S. Holders adjusted basis in such common shares. In addition, the U.S. Holder is allowed a deduction for the lesser of (i) the excess, if any, of such U.S. Holders adjusted tax basis in the common shares over the
fair market value of such shares as of the close of the tax year, or (ii) the excess, if any, of (A) the mark-to-market gains for the common shares in Quartz included by such U.S. Holder for prior tax years, including any amount which would have
been treated as a mark-to-market gain for any prior tax year but for the Section 1291 rules discussed above with respect to Non-Electing U.S. Holders, over (B) the mark-to-market losses for shares that were allowed as deductions for prior tax years.
A U.S. Holders adjusted tax basis in the common shares of Quartz will be adjusted to reflect the amount included in or deducted from income as a result of a mark-to-market election. A mark-to-market election applies to the taxable year in
which the election is made and to each subsequent taxable year, unless Quartz common shares cease to be marketable, as specifically defined, or the IRS consents to revocation of the election.  Because the IRS has not established procedures for
making a mark-to-market election, U.S. Holders should consult their tax advisors regarding the manner of making such an election.  No view is expressed regarding whether common shares of Quartz are marketable for these purposes or whether the
election will be available.

Under Section 1291(f) of the Code, the IRS has issued Proposed Treasury Regulations that, subject to certain exceptions, would treat as taxable certain transfers of PFIC stock by Non-Electing U.S. Holders that are generally not otherwise taxed, such
as gifts, exchanges pursuant to corporate reorganizations, and transfers at death. Generally, in such cases the basis of Quartz common shares in the hands of the transferee and the basis of any property received in the exchange for those common
shares would be increased by the amount of gain recognized. Under the Proposed Treasury Regulations, an Electing U.S. Holder would not be taxed on certain transfers of PFIC stock, such as gifts, exchanges pursuant to corporate reorganizations, and
transfers at death. The transferees basis in this case will depend on the manner of the transfer. In the case of a transfer by an Electing U.S. Holder upon death, for example, the transferees basis is generally equal to the fair market
value of the Electing U.S. Holders common shares as of the date of death under Section 1014 of the Code. The specific tax effect to the U.S. Holder and the transferee may vary based on the manner in which the common shares are transferred.
Each U.S. Holder of Quartz is urged to consult a tax advisor with respect to how the PFIC rules affect his or its tax situation.

Whether or not a U.S. Holder makes a timely QEF election with respect to common shares of Quartz, certain adverse rules may apply in the event that both Quartz and any foreign corporation in which Quartz directly or indirectly holds shares is a PFIC
(a lower-tier PFIC). Pursuant to certain Proposed Treasury Regulations, a U.S. Holder would be treated as owning his or its proportionate amount of any lower-tier PFIC shares, and generally would be subject to the PFIC rules with respect
to such indirectly-held PFIC shares unless such U.S. Holder makes a timely QEF election with respect thereto.  Quartz intends to make the necessary information available to U.S. Holders to permit them to make (and maintain) QEF elections with
respect to each subsidiary of Quartz that is a PFIC.

Under the Proposed Treasury Regulations, a U.S. Holder who does not make a timely QEF election with respect to a lower-tier PFIC generally would be subject to tax (and the PFIC interest charge) on (i) any excess distribution deemed to have been
received with respect to his or its lower-tier PFIC shares and (ii) any gain deemed to arise from a so-called indirect disposition of such shares. For this purpose, an indirect disposition of lower-tier PFIC shares would generally
include (i) a disposition by Quartz (or an intermediate entity) of lower-tier PFIC shares, and (ii) any other transaction resulting in a diminution of the U.S. Holders proportionate ownership of the lower-tier PFIC, including an issuance of
additional common shares by Quartz (or an intermediate entity).  Accordingly, each prospective U.S. Holder should be aware that he or it could be subject to tax even if such U.S. Holder receives no distributions from Quartz and does not dispose of
its common shares. Quartz strongly urges each prospective U.S. Holder to consult a tax advisor with respect to the adverse rules applicable, under the Proposed Treasury Regulations, to U.S. Holders of lower-tier PFIC shares.

Certain special, generally adverse, rules will apply with respect to Quartz common shares while Quartz is a PFIC unless the U.S. Holder makes a timely QEF election. For example under Section 1298(b)(6) of the Code, a U.S.

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Holder who uses PFIC stock as security for a loan (including a
margin loan) will, except as may be provided in regulations, be treated as
having made a taxable disposition of such shares.

Controlled Foreign Corporation

If more than 50% of the total combined voting power of all
classes of shares entitled to vote or the total value of the shares of Quartz is
owned, actually or constructively, by citizens or residents of the United
States, United States domestic partnerships or corporation, or estates or trusts
other than foreign estates or trusts (as defined by Code Section 7701(a)(31)),
each of which own, actually or constructively, 10% or more of the total combined
voting power of all classes of shares entitled to vote of Quartz (United States
Shareholder), Quartz could be treated as a controlled foreign corporation
(CFC) under Subpart F of the Code. This classification would effect many
complex results, one of which is the inclusion of certain income of a CFC which
is subject to current U.S. tax. The United States generally taxes United States
Shareholders of a CFC currently on their pro rata shares of the Subpart F income
of the CFC. Such United States Shareholders are generally treated as having
received a current distribution out of the CFCs Subpart F income and are also
subject to current U.S. tax on their pro rata shares of increases in the CFCs
earnings invested in U.S. property. The foreign tax credit described above may
reduce the U.S. tax on these amounts. In addition, under Section 1248 of the
Code, gain from the sale or exchange of shares by a U.S. Holder of common shares
of Quartz which is or was a United States Shareholder at any time during the
five-year period ending on the date of the sale or exchange is treated as
ordinary income to the extent of earnings and profits of Quartz attributable to
the shares sold or exchanged. If a foreign corporation is both a PFIC and a CFC,
the foreign corporation generally will not be treated as a PFIC with respect to
United States Shareholders of the CFC. This rule generally will be effective for
taxable years of United States Shareholders beginning after 1997 and for taxable
years of foreign corporations ending with or within such taxable years of United
States Shareholders. Special rules apply to United States Shareholders who are
subject to the special taxation rules under Section 1291 discussed above with
respect to a PFIC. Because of the complexity of Subpart F, a more detailed
review of these rules is outside of the scope of this discussion. Quartz does
not believe that it currently qualifies as a CFC. However, there can be no
assurance that Quartz will not be considered a CFC for the current or any future
taxable year.

F.     Dividends and Paying
Agents

Not applicable.

G.     Statement by Experts

Not applicable.

H.     Documents on Display

Exhibits attached to this Form 20-F are also available for
viewing at the offices of the Company, Suite 1020, 800 West Pender Street,
Vancouver, British Columbia V6C 2V6 or on request of the Company. Copies of the
Companys financial statements and other continuous disclosure documents
required under the British Columbia Securities Act are available for
viewing at www.SEDAR.com.

I.     Subsidiary Information

Not applicable.

35

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ITEM 11     QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK

A.     Transaction Risk and Currency
Risk Management

The Companys operations do not employ financial instruments or
derivatives and given that the Company keeps its excess funds in high-grade
short-term instruments it does not have significant or unusual financial market
risks.

B.     Exchange Rate Sensitivity

A significant portion of Quartz's administrative operations are
in Canada.

The Company typically holds most of its funds in Canadian
dollars and reports the results of its operations in United States dollars so is
therefore affected by exchange rate risk.

The Company does not hedge this risk, and it does not consider
this exposure to be material in the context of its operations.

C.     Interest Rate Risk and Equity
Price Risk

The Company is equity financed and does not have any debt.

D.     Commodity Price Risk

While the value of the Companys resource properties, if any,
can always be said to relate to the price of precious metals and the outlook for
same, the Company does not have any operating mines and hence does not have any
hedging or other commodity based operations risks respecting its business
activities.

36

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ITEM 12     DESCRIPTION OF SECURITIES
OTHER THAN EQUITY SECURITIES

A.     Debt Securities

Not applicable.

B.     Warrants and Rights

At November 30, 2005, the Company had 1,510,000 warrants
exercisable at Cdn$0.37 and expiring on April 19, 2006 outstanding.

Each warrant is exercisable for one common share of Quartz.

C.     Other Securities

Not applicable.

D.     American Depositary
Shares

Not applicable.

37

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PART II

ITEM 13     DEFAULTS, DIVIDEND
ARREARAGES AND DELINQUENCIES

Not applicable.

38

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ITEM 14     MATERIAL MODIFICATIONS TO
THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

Not applicable.

39

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ITEM 15     CONTROLS AND
PROCEDURES

Not applicable.

40

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ITEM 16     AUDIT COMMITTEE, CODE OF
ETHICS, ACCOUNTANT FEES AND EXEMPTIONS

A.     Audit Committee Financial
Expert

The Board of Directors has determined that Mr. Brian Causey is
a member of the audit committee of the Company who qualifies as a "financial
expert based on his education and experience. Mr. Causey is "independent", as
the term is defined in Item 401(e) of Regulation S-B.

B.     Code of Ethics

The Company has adopted a Code of Ethics that applies to the
Company's chief executive officer, the chief financial officer, and other
members of senior management. The Code of Ethics was appended as an exhibit to
the Annual Report on Form 20-F filed in January 2005.

During the most recently completed fiscal year, the Company has
neither: (a) amended its Code of Ethics; nor (b) granted any waiver (including
any implicit waiver) form any provision of its Code of Ethics.

C.     Principal Accountant Fees and
Services

The following table discloses the aggregate fees billed for
each of the last two fiscal years for professional services rendered by the
Company's audit firm for various services. The figures in the table below are
expressed in Canadian Dollars.

|Services:          |        | Year ended    | 
|------------------ | ------ | ------------- | 
|                   |        | July 31, 2005 | 
|                   |        |               | 
|Audit Fees         | C$     | 23,307        | 
|Audit Related Fees |        |              | 
|Tax Fees           |        | 1,800         | 
|All Other Fees     |        |              | 
|                   | **C$** | 25,107        | 

Audit related fees are comprised of fees billed for assurance
and advisory services related to the annual audit which are not reported under
audit fees.

From time to time, management of the Company recommends to and
requests approval from the audit committee for non-audit services to be provided
by the Company's auditors. The audit committee routinely considers such requests
at committee meetings, and if acceptable to a majority of the audit committee
members, pre-approves such non-audit services by a resolution authorizing
management to engage the Company's auditors for such non-audit services, with
set maximum dollar amounts for each itemized service. During such deliberations,
the audit committee assesses, among other factors, whether the services
requested would be considered "prohibited services" as contemplated by the US
Securities and Exchange Commission, and whether the services requested and the
fees related to such services could impair the independence of the auditors.

D.     Exemptions from Listing Standards
for Audit Committees

Not applicable.

E.     Purchases of Equity Securities by
the Issuer and Affiliated Purchasers

None.

41

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PART III

ITEM 17     FINANCIAL STATEMENTS

The following financial statements are filed as part of this
annual report:

|(1) | Report of the Independent Registered Public Accounting
      Firm on the consolidated balance sheets as at July 31, 2005 and 2004;
      consolidated statements of operations and deficit, and cash flows for the
      years ended July 31, 2005, 2004 and 2003;
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                   
|(2) | Consolidated balance sheets as at July 31, 2005 and
      2004;                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                   
|(3) | Consolidated statements of operations and deficit for
      each of the years ended July 31, 2005, 2004 and 2003;                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                   
|(4) | Consolidated statements of cash flows for the years ended
      July 31, 2005, 2004 and 2003;                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                   
|(5) | Notes to the consolidated financial statements, of which
      note 10 includes a reconciliation to United States generally accepted
      accounting principles.                                                                                                 

42

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ITEM 18     FINANCIAL STATEMENTS

Not applicable. See Item 17.

43

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ITEM 19     EXHIBITS

Key to the following document types:

|1.    | Articles of Incorporation and Bylaws, or comparable
      instruments, of the Company.  
|----- | ----------------------------------------------------------------------------------------
|      |                                                                                         
|2.    | Other Instruments defining the rights of the holders of
      equity or debt securities.
|      |                                                                                         
|3.    | Voting trust agreements.                                                                
|      |                                                                                         
|4     |                                                                                         
|      |                                                                                         
|      | a.                                                                                      
|      |                                                                                         
|      | b.                                                                                      
|      |                                                                                         
|      |                                                                                         
|      |                                                                                         
|      |                                                                                         
|      |                                                                                         
|      |                                                                                         
|      |                                                                                         
|      |                                                                                         
|      |                                                                                         
|      | c.                                                                                      
|      |                                                                                         
|5.-9. | Not applicable.                                                                         
|      |                                                                                         
|10.   | Other                                                                                   

The following Exhibits have been filed with the Company's
Annual Report on Form 20-F in previous years:

|Type of  |                                                                                                                                                                                                            
|-------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Document | Description                                                                                                                                                                                                
|         |                                                                                                                                                                                                            
|1        | Certificate
        of Incorporation and Memorandum, as amended, June 5, 1986, (incorporated
        by reference to Exhibit 3 to the Companys Statement of Form 10,
        Commission File No. 0-15490).
|
|         |                                                                                                                                                                                                            
|1        | Articles July 28,
        1982, (incorporated by reference to Exhibit 3 to the Companys Statement
        on Form 10, Commission File No. 0-15490).                                                       
|
|         |                                                                                                                                                                                                            
|1        | Certificate of Change of Name,
        November 5, 1997.                                                                                                                                                   
|         |                                                                                                                                                                                                            
|1        | Articles, July 28,
        1982 (incorporated by reference to Exhibit 4 to the Companys Registration
        Statement on Form 10, Commission file No. 0-15490).                                          
|

44

---

|Type of  |                                                                                                                                                                                                                                                              
|-------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Document | Description                                                                                                                                                                                                                                                  
|         |                                                                                                                                                                                                                                                              
|10       | Quartz
        Mountain Resources Ltd. Stock Incentive Plan, as amended (incorporated
        by reference to Exhibit 4 to the Companys Form S-8 Registration
        Statement dated November 27, 1989,   Commission File No. 33-32388).                   
|
|
|         |                                                                                                                                                                                                                                                              
|10       | Indemnity
        Agreement dated February 1989, between the Company and David S. Jennings
        (incorporated by reference to Exhibit 10(a) to the Companys Form
        S-8 Registration No. 33-32388).                                                 
|
|         |                                                                                                                                                                                                                                                              
|10       | Letter Agreement
        dated August 21, 1995, between Wavecrest Resources, Inc. and Newmont Exploration
        Limited. (Incorporated by reference to Exhibit 10.1 to the Companys
        Form 8-K dated August 21, 1995).                              
|
|
|         |                                                                                                                                                                                                                                                              
|10       | Exploration, Development
        and Mining Operations Agreement dated December 31, 1995, between Newmont
        Exploration Limited and the Company. (Incorporated by reference to Exhibit
        10.1 to the Companys Form 10-QSB dated April 30, 1996.)
|
|
|         |                                                                                                                                                                                                                                                              
|10       | Audit Committee
        Charter (incorporated by reference to Exhibit 10.1 to the Companys
        annual report on Form 20-F for the year ended July 31, 2004.)                                                                                            
|
|         |                                                                                                                                                                                                                                                              
|10       | Geological and Management
        Services Agreement between Hunter Dickinson Inc. and the Company (incorporated
        by reference to Exhibit 10.2 to the Companys annual report on Form
        20-F for the year ended July 31, 2004).                 
|
|
|         |                                                                                                                                                                                                                                                              
|10.1     | Code of Ethics                                                                                                                                                                                                                                               

Exhibits included as part of this Form 20-F are as
follows:

|Type of  |                                                                                                                                                                                                                                                                                                     
|-------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Document | Description                                                                                                                                                                                                                                                                                         
|         |                                                                                                                                                                                                                                                                                                     
|1        | Transition
      Application dated October 11, 2005                                                                                                                                                                                                                                                 
|         |                                                                                                                                                                                                                                                                                                     
|1        | Notice
      of Articles dated October 11, 2005                                                                                                                                                                                                                                                     
|         |                                                                                                                                                                                                                                                                                                     
|1        | Notice of Alteration of Articles
      dated October 11, 2005                                                                                                                                                                                                                                       
|         |                                                                                                                                                                                                                                                                                                     
|10       | Audit
        Committee Charter                                                                                                                                                                                                                                                                     
|         |                                                                                                                                                                                                                                                                                                     
|99.1     | Consolidated
        balance sheets as at July 31, 2005 and 2004; consolidated statements of
        operations and deficit, and cash flows for each of the years ended July
        31, 2005, 2004 and 2003, together with Report of Independent Registered
        Public Accounting Firm thereon;

45

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Certification documents included as part of this Form 20-F
are as follows:

|Type of  |                                                                                                                                                                                                                                                                        
|-------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Document | Description                                                                                                                                                                                                                                                            
|         |                                                                                                                                                                                                                                                                        
|12.1     | 302
        Certification of the President of the Corporation pursuant to Rule 13a-14(a)
        of the Securities Exchange Act of 1934 dated December 15, 2005                                                                                                        
|
|         |                                                                                                                                                                                                                                                                        
|12.2     | 302
        Certification of the Principal Accounting Officer of the Corporation pursuant
        to Rule 13a-14(a) of the Securities Exchange Act of 1934 dated December
        15, 2005                                                                             
|
|         |                                                                                                                                                                                                                                                                        
|13.1     | 906
        Certification of the President of the Corporation pursuant to Rule 13a-14(b)
        of the Securities Exchange Act of 1934 and Section 1350 of Chapter 63
        of Title 18 of the United States Code dated December15, 2005                            
|
|
|         |                                                                                                                                                                                                                                                                        
|13.2     | 906
        Certification of the Principal Accounting Officer of the Corporation pursuant
        to Rule 13a-14(b) of the Securities Exchange Act of 1934 and Section 1350
        of Chapter 63 of Title 18 of the United States Code dated December 15,
        2005
|
|

The Company certifies that it meets all of the requirements for
filing on Form 20-F and that it has duly caused and authorized the undersigned
to sign this annual report on its behalf.

QUARTZ MOUNTAIN RESOURCES LTD.

Per:

/s/Rene Carrier Rene Carrier President

Dated: December 15, 2005

46

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