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KABX ~ DD file by the filings, for the people!

During 2007, we were an exploration stage company engaged in the acquisition and exploration of mineral properties. We entered into a lease agreement with George J. Eliopulos effective March 31, 2006, granting us the exclusive right to explore, develop, and mine the property for gold, silver, copper and other valuable minerals. The property consisted of one unpatented mining claim located in section 12, Township 16 North, Range 20 East, Mt. Diablo Baseline & Meridian, Storey County, Nevada, USA, owned by Mr. Eliopulos.

On December 18, 2007, Erik Ulsteen entered into an agreement with Antony Claydon, our former President and a director and Rory Moss, a director, to purchase 1,500,000 and 250,000 shares of common stock, respectively, for an aggregate purchase price of $50,000. The transaction closed on February 14, 2008 at which time, Mr. Claydon resigned as President, Chief Financial Officer and Secretary and Mr. Ulsteen was appointed President, Chief Financial Officer, Secretary and director. On January 28, 2008, we terminated our lease agreement with Mr. Eliopulos.

On February 21, 2013, we purchased 320 mineral lease acres in Butler County Kansas representing a 81% Net Revenue Interest, or NRI. We plan to drill shallow wells 3300-6000 ft. on a turnkey basis, which is a very low cost drilling program. We hope to achieve production of approx. 100-200 barrels per day, or BPD, for each well and we plan to drill 1 well initially and up to 7 wells if results from the first one are positive. We are currently in a pre-production phase and are gearing up towards full production development. Drilling might commence sooner based on funding received.

The following factors raise substantial doubt regarding the ability of our business to continue as a going concern: (i) the losses we have incurred since our inception; (ii) our failure to generate revenues since our inception; and (iii) our dependence on the sale of our equity securities and on the receipt of capital from outside sources to continue our operations. Our auditors have issued a going concern opinion regarding our business. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your investment.

On March 31, 2013, the Company issued 1,500,000 shares of common stock for services at $0.03 per share. An expense of $45,000 was recorded.

On April 17, 2013, the Company issued 480,000 shares of common stock for directors fees at $0.03 per share. An expense of $14,400 was recorded.

On May 31, 2013, the Company issued 950,000 shares of common stock for services at $0.02 per share. An expense of $19,000 was recorded.

On June 26, 2013, the Company issued 2,857,143 shares of common stock for $50,000 cash at $0.0018 per share.

From our inception through September 30, 2013, we have incurred cumulative losses of $ $ 686,613 . Professional fees increased to $ 5 , 250 for the three months ended September 30, 2013 from $ 2 , 525 for the three months ended September 30 , 2012. Consulting fees decrease to $5 , 000 for the three months endedSeptember 30, 2013 from $40,000 for the three months ended September 30, 2012. Other Administrative expenses decrease to $2 , 033 for the three months ended September 30,2013 from $ 2 , 440 for the three months ended , September 30, 2013.

Nine Months Ended September 30, 2013 Compared to Nine Months Ended September 30, 2012

As of September 30, 2013, we had a working capital t of $ 35,400 as compared to a working capital deficit of $ 41,367 as of December 31, 2012. Our cash position was $ $369,983 as of September 30, 2013 compared to $138 as of December 31, 2012. We have financed our company principally through the private placement of our common stock. As of September 30, 2013, we have no long term debt.

On June 19, 2013, the Company issued a promissory note for $500,000 to JMJ Financial, a Massachusetts limited liability corporation. As of September 30, 2013, JMJ Financial has advanced the Company only $50,000 of the promissory note for $250,000. As of September 30, 2013, the Company is only obligated for $50,000 of the promissory note. The note exhibits the following terms:

a. Effective Date is the date following the execution date (June 19, 2013) and delivery of the first payment.
b. Zero percent interest for the first three months.
c. Loan may be repaid on or before the first 90 days.
d. Thereafter, loan payments prior to the maturity date may not be made without written approval of the Lender.
e. Interest rate remains at zero percent if the loan is repaid within the first 90 days.
f. If the loan is not repaid within the first 90 days, a one-time interest charge of 12% is applied to the principal sum, designated as OID (original issue discount).
g. Interest on the loan is in addition to the OID.
h. The loan maturity date is June 19, 2014, one year from the effective date.
i. The principal sum is the consideration actually paid plus OID plus interest and fees payable.
j. The principal sum may be converted to common stock at any time after the effective date at the rate of the lesser of $0.015 per share, or 60% of the lowest trade price in the 25 days previous to the conversion.
k. Other conditions apply.


We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to our stockholders.

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CONFIDENTIAL TERM SHEET

Issuer:
KABE EXPLORATION, Inc. (“Company”)


Investor:
Phoenix Group Capital Markets, LP (“Investor”)


Amount:
The Investor shall commit to purchase up to $5,000,000 of the Company’s common stock over the course of 36 months (“REF Period”).

Maximum Advance Amount for Stock:
Company will issue up to 10,000,000 of Stock per month up to $5,000,000.

Pricing Period For Stock:
The Ten consecutive weekday trading days immediately after the Advance Date.

Purchase Price:

For Stock:
Fifty percent (50%) of the lowest volume weighted Average price of the Stock during the Pricing Period. The fund shall advance up to $100,000 to Strategic Global Investments on a bi-weekly basis upon clearing of the shares as free-trading and liquidity campaign start.


Commitment Shares:
Company shall issue Stock to Investor equaling 10% of the REF Amount.


Floor Price:

Agreement:

The Company shall automatically withdraw that portion of the Advance amount, if the stock price with respect to that Advance does not meet the Floor Price. The Floor Price shall be 50% of the average closing price of the common stock for the ten (10) Trading Days prior to the Advance Notice Date.


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10.1
Letter of Intent with Fortune Oil & Gas Ltd. dated January 15, 2013

10.2
Letter of Intent with Sal Mazullo dated February 15, 2013

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