10QSB 1 0001.txt FORM 10QSB UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB [xx] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000 Commission file Number: 000-30658 CORBETT LAKE MINERALS, INC. (Exact name of small business issuer as specified in its charter) Nevada (State or other jurisdiction of incorporation or organization) 91-2008331 (I.R.S. Employer Identification Number) Suite 1500 885 West Georgia Street Vancouver, British Columbia V6C 3E8 (Address of principal executive offices) (604)687-0717 (Issuer's telephone number) State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 12,000,000 common shares as at September 30, 2000 Transitional Small Business Disclosure Format (check one): Yes [ ] No [ X ] CORBETT LAKE MINERALS, INC. INDEX PART 1. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets as of September 30, 2000 and March 31, 2000 Consolidated Statements of Operations for the periods ended September 30, 2000 and September 30, 1999 Consolidated Statements of Cash Flows for the periods ended September 30, 2000 and September 30, 1999 Consolidated Statements of Changes in Stockholders' Equity Notes to Consolidated Financial Statements Item 2 Plan of Operation PART II. OTHER INFORMATION Item 1 Legal Proceedings Item 2 Changes in Securities Item 3 Defaults Upon Senior Securities Item 4 Submission of Matters to a Vote of Security Holders Item 5 Other Information Item 6 Exhibits and Reports on Form 8K SIGNATURES 2 CORBETT LAKE MINERALS, INC. (AN EXPLORATION STAGE COMPANY) FINANCIAL STATEMENTS (EXPRESSED IN UNITED STATES DOLLARS) (UNAUDITED) SEPTEMBER 30, 2000 CORBETT LAKE MINERALS, INC. (An Exploration Stage Company) BALANCE SHEETS (Unaudited)
============================================================================================================================= September 30, December 31, 2000 1999 ----------------------------------------------------------------------------------------------------------------------------- ASSETS CURRENT Cash and cash equivalents $ 4,113 $ 32,426 Prepaid expenses 1,500 -- --------------- -------------- $ 5,613 $ 32,426 ============================================================================================================================= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT Accounts payable and accrued liabilities $ 5,384 $ 10,579 --------------- -------------- STOCKHOLDERS' EQUITY Capital stock (Note 5) Authorized 200,000,000 common shares, par value of $0.001 Issued and outstanding September 30, 2000 - 12,000,000 common shares December 31, 1999 - 12,000,000 common shares 12,000 12,000 Additional paid-in capital 45,000 45,000 Deficit accumulated during the exploration stage (56,771) (35,153) --------------- --------------- Total stockholders' equity 229 21,847 --------------- --------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 5,613 $ 32,426 ============================================================================================================================= HISTORY AND ORGANIZATION OF THE COMPANY (Note 1) GOING CONCERN (Note 2)
The accompanying notes are an integral part of these financial statements. CORBETT LAKE MINERALS, INC. (An Exploration Stage Company) STATEMENTS OF OPERATIONS (Unaudited)
============================================================================================================================== Cumulative from Incorporation on March 3, 1999 Three Month Three Month Nine Month Nine Month to Period Ended Period Ended Period Ended Period Ended September 30, September 30, September 30, September 30, September 30, 2000 2000 1999 2000 1999 ------------------------------------------------------------------------------------------------------------------------------ EXPENSES Incorporation costs $ 640 $ -- $ -- $ -- $ 640 Exploration costs 2,875 -- -- 2,875 -- Filing and transfer agent fees 2,226 -- -- 2,131 95 Legal and audit fees 23,149 3,539 -- 8,731 2,644 Management fees 15,000 -- -- 5,000 -- Mineral property acquisition costs 12,881 -- -- 2,881 -- --------------- --------------- --------------- --------------- --------------- LOSS FOR THE PERIOD $ 56,771 $ 3,539 $ -- $ 21,618 $ 3,379 ============================================================================================================================== BASIC AND DILUTED LOSS PER SHARE $ (0.01) $ -- $ (0.01) $ (0.01) ============================================================================================================================== WEIGHTED AVERAGE SHARES OUTSTANDING 12,000,000 12,000,000 12,000,000 12,000,000 ==============================================================================================================================
The accompanying notes are an integral part of these financial statements. CORBETT LAKE MINERALS, INC. (An Exploration Stage Company) STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited)
============================================================================================================================== Deficit Accumulated Common Stock Additional During the -------------- -------------- Paid-in Exploration Shares Amount Capital Stage Total ------------------------------------------------------------------------------------------------------------------------------ INCEPTION, MARCH 3, 1999 -- $ -- $ -- $ -- $ -- Shares issued for cash 12,000,000 12,000 45,000 -- 57,000 Loss for the period -- -- -- (35,153) (35,153) ------------- ------------- ------------- ------------- ------------- BALANCE, DECEMBER 31, 1999 12,000,000 12,000 45,000 (35,153) 21,847 Loss for the period -- -- -- (21,618) (21,618) ------------- ------------- ------------- ------------- ------------- BALANCE, SEPTEMBER 30, 2000 12,000,000 $ 12,000 $ 45,000 $ (56,771) $ 229 ==============================================================================================================================
The accompanying notes are an integral part of these financial statements. CORBETT LAKE MINERALS, INC. (An Exploration Stage Company) STATEMENTS OF CASH FLOWS (Unaudited)
============================================================================================================================== Cumulative from Incorporation on March 3, 1999 Nine Month Nine Month to Period Ended Period Ended September 30, September 30, September 30, 2000 2000 1999 ------------------------------------------------------------------------------------------------------------------------------ CASH FLOWS FROM OPERATING ACTIVITIES Loss for the period $ (56,771) $ (21,618) $ (3,379) Change in other operating assets and liabilities: Increase in prepaid expenses (1,500) (1,500) -- Increase (decrease) in accounts payable and accrued liabilities 5,384 (5,195) 2,644 --------------- --------------- --------------- Net cash used in operating activities (52,887) (28,313) (735) --------------- --------------- --------------- CASH FLOWS FROM INVESTING ACTIVITIES Net cash used in investing activities -- -- -- --------------- --------------- --------------- CASH FLOWS FROM FINANCING ACTIVITIES Issuance of capital stock for cash 57,000 -- 27,533 --------------- --------------- --------------- Net cash provided by financing activities 57,000 -- 27,533 --------------- --------------- --------------- CHANGE IN CASH AND CASH EQUIVALENTS DURING THE PERIOD 4,113 (28,313) 26,798 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD -- 32,426 -- --------------- --------------- --------------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 4,113 $ 4,113 $ 26,798 ============================================================================================================================== CASH PAID DURING THE PERIOD FOR: Interest expense $ -- $ -- $ -- Income taxes -- -- -- ==============================================================================================================================
SUPPLEMENTAL DISCLOSURE FOR NON-CASH FINANCING AND INVESTING ACTIVITIES There were no significant non-cash transactions for the nine month periods ended September 30, 2000 and 1999 and for the period from incorporation on March 3, 1999 to September 30, 2000. The accompanying notes are an integral part of these financial statements. CORBETT LAKE MINERALS, INC. (An Exploration Stage Company) NOTES TO THE FINANCIAL STATEMENTS (Unaudited) SEPTEMBER 30, 2000 ================================================================================ 1. HISTORY AND ORGANIZATION OF THE COMPANY The Company was formed on March 3, 1999 under the Laws of the State of Nevada and is in the business of exploration and development of mineral properties. The Company has not yet determined whether its properties contain mineral resources that may be economically recoverable. The Company therefore has not reached the development stage and is considered to be an exploration stage company. The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, changes in stockholders' equity and cash flows at September 30, 2000 and for the periods then ended have been made. These financial statements should be read in conjunction with the audited financial statements of the Company for the year ended December 31, 1999. The results of operations for the period ended September 30, 2000 are not necessarily indicative of the results to be expected for the year ending December 31, 2000. 2. GOING CONCERN These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The general business strategy of the Company is to acquire mineral properties either directly or through the acquisition of operating entities. The continued operations of the Company and the recoverability of mineral property costs is dependent upon the existence of economically recoverable reserves, confirmation of the Company's interest in the underlying mineral claims, the ability of the Company to obtain necessary financing to complete the development and upon future profitable production. The Company has incurred operating losses and requires additional funds to meet its obligations and maintain its operations. Management's plan in this regard is to raise equity financing as required. These conditions raise substantial doubt about the Company's ability to continue as a going concern. These financial statements do not include any adjustments that might result from this uncertainty.
==================================================================================================================== September 30, December 31, 2000 1999 -------------------------------------------------------------------------------------------------------------------- Deficit accumulated during the exploration stage $ (56,771) $ (35,153) Working capital 229 21,847 ====================================================================================================================
3. SIGNIFICANT ACCOUNTING POLICIES CASH AND CASH EQUIVALENTS Cash and cash equivalents include highly liquid investments with original maturities of three months or less. These are recorded at cost which approximates market. CORBETT LAKE MINERALS, INC. (An Exploration Stage Company) NOTES TO THE FINANCIAL STATEMENTS (Unaudited) SEPTEMBER 30, 2000 ================================================================================ 3. SIGNIFICANT ACCOUNTING POLICIES (cont'd.....) ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. FINANCIAL INSTRUMENTS The Company's financial instruments consist of cash and cash equivalents and accrued liabilities. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. The fair value of these financial instruments approximate their carrying values, unless otherwise noted. RESOURCE PROPERTIES Costs of acquisition, exploration, carrying, and retaining unproven properties are expensed as incurred. Costs incurred in proving and developing a property ready for production are capitalized and amortized over the life of the mineral deposit or over a shorter period if the property is shown to have an impairment in value. ENVIRONMENTAL REQUIREMENTS At the report date, environmental requirements related to mineral claims acquired (Note 4) are unknown and therefore an estimate of any future cost cannot be made. INCOME TAXES Income taxes are provided in accordance with Statement of Financial Accounting Standards No. 109 ("SFAS 109"), "Accounting for Income Taxes". A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards. Deferred tax expenses (benefit) result from the net change during the year of deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. LOSS PER SHARE In February 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128, "Earnings Per Share" ("SFAS 128"). Under SFAS 128, basic and diluted earnings per share are to be presented. Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding in the period. Diluted earnings per share takes into consideration common shares outstanding (computed under basic earnings per share) and potentially dilutive common shares. CORBETT LAKE MINERALS, INC. (An Exploration Stage Company) NOTES TO THE FINANCIAL STATEMENTS (Unaudited) SEPTEMBER 30, 2000 ================================================================================ 3. SIGNIFICANT ACCOUNTING POLICIES (cont'd.....) FOREIGN CURRENCY TRANSLATION Translation amounts denominated in foreign currencies are translated into United States currency at exchanges rates prevailing at transactions dates. Carrying values of monetary assets and liabilities are adjusted at each balance sheet date to reflect the exchange rate at that date. Gains and losses from restatement of foreign currency monetary assets and liabilities are included in income. STOCK-BASED COMPENSATION Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation," encourages, but does not require, companies to record compensation cost for stock-based employee compensation plans at fair value. The Company has chosen to account for stock-based compensation using Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees." Accordingly compensation cost for stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee is required to pay for the stock. COMPREHENSIVE INCOME The Company has adopted Statement of Financial Accounting Standards No. 130 ("SFAS 130"), "Reporting Comprehensive Income". This statement establishes rules for the reporting of comprehensive income and its components. The adoption of SFAS 130 had no impact on total stockholders' equity as of September 30, 2000. ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES In September 1998, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards No. 133 ("SFAS 133"), "Accounting for Derivative Instruments and Hedging Activities" which establishes accounting and reporting standards for derivative instruments and for hedging activities. SFAS 133 is effective for all fiscal quarters of fiscal years beginning after September 15, 1999. In September 1999, the FASB issued SFAS 137 to defer the effective date of SFAS 133 to fiscal quarters of fiscal years beginning after September 15, 2000. The Company does not anticipate that the adoption of the statement will have a significant impact on its financial statements. 4. MINERAL PROPERTY On July 20, 1999, the Company acquired an option to purchase a 100% interest in the CP 1-12 mining claims located in the Nicola Mining Division of British Columbia for $10,000 (paid). As the claims do not contain any known reserves, the acquisition costs were expensed during the period ended December 31, 1999. To exercise its option, the Company must complete a recommended work program in the amount of CDN$11,700 by July 20, 2000. CORBETT LAKE MINERALS, INC. (An Exploration Stage Company) NOTES TO THE FINANCIAL STATEMENTS (Unaudited) SEPTEMBER 30, 2000 ================================================================================ 5. CAPITAL STOCK The authorized common stock of the Company is 200,000,000 shares of common stock with a par value of $0.001 per share. All of the issued and outstanding shares are fully paid and non-assessable. All shares have equal voting rights and, when validly issued, are entitled to one vote per share in all matters to be voted upon by the stockholders. The shares have no pre-emptive, subscription, conversion or redemption rights and may be issued only as fully paid and non-assessable shares. Holders of common shares are entitled to share rateable in dividends, as may be declared from time to time by the Board of Directors in its discretion, from funds legally available for dividend payments. The Company has issued 7,000,000 common shares under Rule 504 of Regulation D of the Securities Act of 1933, at a price of $0.001 per share, for total proceeds of $7,000. In addition, the Company has issued 5,000,000 common shares under Rule 504 of Regulation D of the Securities Act of 1933, at a price of $0.01 per share, for total proceeds of $50,000. 6. INCOME TAXES The Company's total deferred tax asset is as follows:
==================================================================================================================== September 30, December 31, 2000 1999 -------------------------------------------------------------------------------------------------------------------- Tax benefit of net operating loss carryforward $ 8,516 $ 5,273 Valuation allowance (8,516) (5,273) --------------- -------------- $ -- $ -- ====================================================================================================================
The Company has a net operating loss carryforward of approximately $56,771. The Company has provided a full valuation allowance on the deferred tax asset because of the uncertainty regarding realizability. 7. RELATED PARTY TRANSACTIONS Management fees of $5,000 were paid to a director of the Company for the nine month period ended September 30, 2000 (September 30, 1999 - $Nil). 8. COMMITMENT The Company entered into an Employment and Services Agreement dated August 2, 1999, with the director of the Company, whereby the Company shall pay a salary of $15,000 annually for a period of two years. PLAN OF OPERATION The following discussion of the plan of operation of the Company should be read in conjunction with the financial statements and the related notes thereto included elsewhere in this quarterly report for the nine months ended September 30, 2000. This quarterly report contains certain forward-looking statements and the Company's future operation results could differ materially from those discussed herein. The Company can satisfy its cash requirements for the next 12 months from cash on hand. Unless the Company acquires additional mineral exploration properties or commits to a significant exploration program on its existing property, it will not be required to raise additional funds in the next 12 months. Management of the Company will be reviewing the results from the Company's most recent exploration program on its claims with consultants over the upcoming months to determine what further work is warranted on the claims. Management of the Company will also be looking to acquire additional claims if such claims are offered on attractive terms. The Company does not expect to purchase any plant or significant equipment over the next 12 months. The Company does not expect any significant changes in the number of its employees over the next 12 months. PART II OTHER INFORMATION Item 1. LEGAL PROCEEDINGS None Item 2 CHANGES IN SECURITIES AND USE OF PROCEEDS None Item 3 DEFAULTS UPON SENIOR SECURITIES None Item 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None Item 5 OTHER INFORMATION None 12 Item 6 EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits Exhibit 27.1 - Financial Data Schedule (b) Reports on Form 8-K None SIGNATURES In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CORBETT LAKE MINERALS, INC. Dated: November 10, 2000 Per: /s/ Jason John ---------------------------------- Jason John, President and Director