-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UVAcYT2rvXQncV7yMq2xCfw5TF04q7a8F8x1gj1zfGCsQTtsFNRPVgI7cB7wvwNK ZMkPLvSOFlQjrQsJIYuw3g== 0001022106-02-000007.txt : 20020416 0001022106-02-000007.hdr.sgml : 20020416 ACCESSION NUMBER: 0001022106-02-000007 CONFORMED SUBMISSION TYPE: S-1/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20020409 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VALEMONT SUPPLY INC CENTRAL INDEX KEY: 0001164879 STANDARD INDUSTRIAL CLASSIFICATION: MINING, QUARRYING OF NONMETALLIC MINERALS (NO FUELS) [1400] IRS NUMBER: 912123475 STATE OF INCORPORATION: WA FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: S-1/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-76950 FILM NUMBER: 02605072 BUSINESS ADDRESS: STREET 1: 6779 BLACKWELL ROAD KAMLOOPS CITY: B C CANADA STATE: A1 ZIP: 00000 BUSINESS PHONE: 6046816599 S-1/A 1 doc1.txt REGISTRATION NO. 333-76950 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 2 TO FORM S-1/A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 VALEMONT SUPPLY INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) WASHINGTON 1499 912123475 (STATE OR OTHER (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER JURISDICTION OF CLASSIFICATION CODE NUMBER) IDENTIFICATION NO.) INCORPORATION OR ORGANIZATION) 6779 BLACKWELL RD KAMLOOPS, BRITISH COLUMBIA V2C 6V7, CANADA (604) 681 6599 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) AGENT FOR SERVICE: WITH A COPY TO: MIKE FRANKENBERGER JAMES L. VANDEBERG VALEMONT SUPPLY INC. OGDEN MURPHY WALLACE 6779 BLACKWELL RD #2100 - 1601 5TH AVENUE KAMLOOPS, BRITISH COLUMBIA V2C 6V7, CANADA SEATTLE, WASHINGTON 98101 (250) 519 0553 (250) 519-0449 (206) 447-7000 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. [x] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. [ ]
CALCULATION OF REGISTRATION FEE TITLE OF EACH . . . . . . . . . DOLLAR PROPOSED PROPOSED CLASS OF. . . . . . . . . . . . AMOUNT MAXIMUM MAXIMUM AMOUNT OF SECURITIES TO . . . . . . . . . TO BE OFFERING PRICE AGGREGATE REGISTRATION BE REGISTERED . . . . . . . . . REGISTERED PER UNIT OFFERING PRICE FEE - ------------------------------- ---------------- --------------- --------------- ------------- Common stock. . . . . . . . . . 1,000,000 shares $0.04 per share $40,000.00 $10.56 - ------------------------------- ---------------- --------------- --------------- -------------
[GRAPHIC OMITED] Note: Specific details relating to the fee calculation shall be furnished in notes to the table, including references to provisions of Rule 457 (Section 230.457 of this chapter) relied upon, if the basis of the calculation is not otherwise evident from the information presented in the table. If the filing fee is calculated pursuant to Rule 457(o) under the Securities Act, only the title of the class of securities to be registered, the proposed maximum aggregate offering price for that class of securities and the amount of registration fee needed to appear in the Calculation of Registration Fee table. Any difference between the dollar amount of securities registered for such offerings and the dollar amount of securities sold may be carried forward on a future registration statement pursuant to Rule 429 under the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to such section 8(a), may determine. WE WILL AMEND AND COMPLETE THE INFORMATION IN THIS PROSPECTUS. ALTHOUGH WE ARE PERMITTED BY US FEDERAL SECURITIES LAW TO OFFER THESE SECURITIES USING THIS PROSPECTUS, WE MAY NOT SELL THEM OR ACCEPT YOUR OFFER TO BUY THEM UNTIL THE DOCUMENTATION FILED WITH THE SEC RELATING TO THESE SECURITIES HAS BEEN DECLARED EFFECTIVE BY THE SEC. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES OR OUR SOLICITATION OF YOUR OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THAT WOULD NOT BE PERMITTED OR LEGAL. PROSPECTUS APRIL 4, 2002 VALEMONT SUPPLY INC. 6779 BLACKWELL RD KAMLOOPS, BRITISH COLUMBIA V2C 6V7, CANADA (250) 519 0553 (250) 519-0449 1,000,000 Shares of Common Stock - - This is the initial public offering of common stock of Valemont Supply Inc. - - No public market currently exists for shares of Valemont Supply Inc.'s common stock. - - The initial public offering price is $0.04 per share of common stock, which was arbitrarily determined. - - Best efforts, no minimum, direct participation offering. A.E. Daem, Valemont Supply Inc.'s sole director, will use his best efforts to sell the maximum number of securities offered (1,000,000). - - Valemont Supply Inc. is selling its common stock directly. - - There are no underwriters or broker-dealers involved in the selling efforts. Valemont Supply Inc.'s stock is not listed on any national securities exchange or the NASDAQ Stock Market. - - There is no minimum purchase requirement and no arrangement to place funds in an escrow, trust, or similar account. - - Valemont Supply Inc. will close the offering the earlier of 150 days after the date of initial effectiveness or the date the maximum offering is achieved.
OFFERING PRICE UNDERWRITING DISCOUNTS AND COMMISSIONS PROCEEDS TO VALEMONT SUPPLY INC. --------------- --------------------------------------- --------------------------------- PER SHARE BASIS $0.04 per share $0.00 per share $0.04 per share - --------------- --------------- --------------------------------------- --------------------------------- TOTAL OFFERING. $40,000.00 $0.00 $40,000.00 - --------------- --------------- --------------------------------------- ---------------------------------
THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 1. NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. NOR HAVE THEY MADE, NOR WILL THEY MAKE, ANY DETERMINATION AS TO WHETHER ANYONE SHOULD BUY THESE SECURITIES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. Table Of Contents Risk Factors 1 Use of Proceeds 6 Determination of Offering Price 7 Dilution 7 Selling Shareholders 8 Plan of Distribution 8 Description of Capital Stock 9 Interests of Named Experts and Counsel 10 Description of Business 10 Description of Property 12 Legal Proceedings 15 Market Price of and Dividends on Capital Stock and Other Stockholder Matters 15 Selected Financial Data 15 Management's Discussion and Analysis of Financial Condition and Results Of Operations 16 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 18 Directors and Executive Officers 19 Executive Compensation 19 Security Ownership of Certain Beneficial Owners and Management 20 Certain Relationships and Related Transactions 20 Disclosure of Commission Position on Indemnification for Securities Act Liabilities 21 Index to Financial Statements F-1 RISK FACTORS You should carefully consider the following risk factors and all other information contained in this prospectus before purchasing the common stock of Valemont Supply Inc. Investing in Valemont Supply Inc.'s common stock involves a high degree of risk. YOU MAY BE UNABLE TO EFFECTIVELY EVALUATE VALEMONT SUPPLY INC. FOR INVESTMENT PURPOSES, BECAUSE IT HAS NO OPERATING HISTORY AND ITS BUSINESS MODEL IS UNPROVEN. VALEMONT SUPPLY INC. IS IN ITS EARLIEST STAGES OF EXPLORATION AND MAY NEVER BECOME PROFITABLE Valemont Supply Inc. is in the exploration stage and is engaged in the search for mineral deposits (reserves). It is a new company with a limited operating history. It faces all of the risks inherent in a new business. The Company's prospects, given the nature of its business, must be considered in light of the risks, expenses and difficulties frequently encountered by companies in the early exploration stages. There can be no assurance that the Company will achieve or sustain profitability or positive cash flows from operating activities in the future. EVEN IF COMMERCIAL QUANTITIES OF MICA ARE DISCOVERED FAILURE TO OBTAIN SUFFICIENT CUSTOMERS FOR ITS MICA WOULD PREVENT VALEMONT SUPPLY INC. FROM IMPLEMENTING ITS BUSINESS PLAN, AND COULD CAUSE ITS STOCK TO BE WORTHLESS. The mining industry, in general, is intensively competitive and there is not any assurance that even if commercial quantities of mica are discovered, a ready market will exist for sale of same. Valemont Supply Inc.'s mineral claims are located in the Cariboo Mining District of British Columbia, Canada. Collectively the mineral claims make up a mineralized material whose primary mineral is mica. If commercial quantities of mica are discovered it would have a number of end uses such as oil drilling muds, building products, paint, plastics, rubber and other end uses. Failure to obtain sufficient customers for the mica would prevent Valemont Supply Inc. from implementing its business plan, and could cause its stock to be worthless. Valemont Supply Inc.'s mica would compete against those of other established companies, some of which have greater financial, marketing and other resources than those of Valemont Supply Inc. These competitors may be able to institute and sustain price wars, resulting in a reduction of Valemont Supply Inc.'s share of the market and limiting or eliminating profitability. VALEMONT SUPPLY INC. MAY DILUTE EXISTING SHAREHOLDERS BY COMPENSATING SERVICE PROVIDERS BY ISSUING STOCK Valemont Supply Inc. might seek to compensate providers of services by issuance of stock in lieu of cash. Any such stock issuance would dilute ownership interests of shareholders. For example, it is possible that Valemont Supply Inc. would grant stock to compensate its exploration personnel with stock options. Irrespective of whether Valemont Supply Inc.'s cash assets prove to be inadequate to meet its operational needs, Valemont Supply Inc. might seek to compensate providers of services by issuance of stock in lieu of cash, which again would dilute ownership interests of shareholders. VALEMONT SUPPLY INC.'S SIGNIFICANT SHAREHOLDER COULD SELL HIS CONTROL BLOCK TO AN OUTSIDE PARTY RESULTING IN A POSSIBLE CHANGE IN BUSINESS NOT CONSIDERED BY OTHER SHAREHOLDERS Valemont Supply Inc.'s significant shareholder, A.E. Daem, could sell his control block of 8,000,000 shares to an outside party resulting in a majority of the voting power being transferred to the purchaser(s). The result could be that new shareholder(s) would control Valemont Supply Inc. and persons unknown could replace Valemont Supply Inc.'s management. It is uncertain whether any such replacements would continue to implement Valemont Supply Inc.'s current business plan. PURCHASERS MUST RELY ON MR. DAEM'S ABILITIES FOR ALL DECISIONS AS HE CONTROLS THE MAJORITY OF THE STOCK. VALEMONT SUPPLY INC. HAS NO EMPLOYMENT AGREEMENT WITH MR. DAEM AND HE SPENDS ONLY PART-TIME ON ITS BUSINESS. HIS LEAVING MAY ADVERSELY AFFECT VALEMONT SUPPLY INC.'S ABILITY TO OPERATE Mr. Daem is serving as Valemont Supply Inc.'s sole officer and director. Valemont Supply Inc. will be heavily dependent upon Mr. Daem's entrepreneurial skills and experience to implement its business plan. Mr. Daem devotes approximately 40% of his time to Valemont Supply Inc. and investors may, from time to time, find that his inability to devote full time and attention to its affairs will result in delay(s) in progress towards the implementation of its business plan or in a failure to implement its business plan. moreover, Valemont Supply Inc. does not have an employment agreement with Mr. Daem and as a result, he may not continue to manage its affairs in the future. nor has Valemont Supply Inc. obtained a key man life insurance policy on Mr. Daem. Valemont Supply Inc. could lose the services of Mr. Daem, or Mr. Daem could decide to join a competitor or otherwise compete directly or indirectly with Valemont Supply Inc., which would have a significant adverse effect on its business and could cause the price of its stock to be worthless. the services of Mr. Daem would be difficult to replace. VALEMONT SUPPLY INC. MAY NOT BE ABLE TO RAISE ADDITIONAL FINANCING IF NEEDED FOR ITS BUSINESS AND IN THE EVENT OF A BANKRUPTCY SHAREHOLDERS COULD LOSE THEIR ENTIRE INVESTMENT Valemont Supply Inc.'s ultimate success may depend on its ability to raise additional capital. Failure to raise the neces-sary funds in a timely fashion will severely limit Valemont Supply Inc.'s future operations, if any and it would be unable to implement its business plan. If Valemont Supply Inc. raises additional funds through the issuance of equity, equity-related or convertible debt securities, these securities may have rights, preferences or privileges senior to those of the rights of its common stock and its stockholders may experience additional dilution. In the event of a bankruptcy in either case, shareholders could loose their entire investments as a result of the senior preferences or privileges. No commitments to provide additional funds have been made by management or other shareholders. Valemont Supply Inc. has not investigated the availability, source or terms that might govern the acquisition of additional financing. When additional capital is needed, Valemont Supply Inc. may not be able to source funds that can be obtained on terms acceptable to it. VALEMONT SUPPLY INC.'S AUDITORS HAVE EXPRESSED THAT THERE IS SUBSTANTIAL DOUBT REGARDING VALEMONT SUPPLY INC.'S ABILITY TO CONTINUE AS A GOING CONCERN AND THEREFORE INVESTORS COULD LOOSE THEIR ENTIRE INVESTMENT. Valemont Supply Inc.'s auditors have expressed that there is substantial doubt regarding Valemont Supply Inc.'s ability to continue as a going concern. Valemont Supply Inc. has not generated any revenues or conducted any operations since inception. The ability of Valemont Supply Inc. to achieve success with respect to its planned principal business activity is dependent upon its successful efforts to attain profitable operations. Valemont Supply Inc. may not be able to sell any of its products at a profit. There is therefore substantial doubt regarding Valemont Supply Inc.'s ability to continue as a going concern. VALEMONT SUPPLY INC. COMMON STOCK HAS NO PRIOR MARKET AND STEPS HAVE NOT BEEN TAKEN TO HAVE ITS COMMON STOCK LISTED ON THE NASD OVER-THE-COUNTER BULLETIN BOARD. THERE ARE NO IMMEDIATE PLANS TO DO SO. FURTHERMORE VALEMONT SUPPLY INC. MAY NEVER RECEIVE APPROVAL FOR LISTING AND ACCORDINGLY PRICES MAY DECLINE AFTER THE OFFERING AND SHAREHOLDERS MAY HAVE DIFFICULTY SELLING THEIR SHARES There is no public market for Valemont Supply Inc.'s common stock and no market may develop that would allow any shareholder to be able to liquidate his investment without considerable delay, if at all. Valemont Supply Inc. has not taken any steps to have its shares listed on the NASD over-the-counter bulletin board but does intend to do so. Although Valemont Supply Inc. intends to apply to have its shares traded on the NASD over-the-counter bulletin board shortly after it has a sufficient number of shareholders to interest a market maker in making a market in its securities there is no guarantee that this will occur. The trading market price of Valemont Supply Inc.'s common stock may therefore decline below the offering price. If a market should develop, the price may be highly volatile. In addition, an active public market for Valemont Supply Inc.'s common stock may not develop or be sustained. All of Valemont Supply Inc.'s outstanding shares, except for those of A.E. Daem, are being registered for sale pursuant to this offering. If Valemont Supply Inc.'s selling stockholders sell substantial amounts of common stock in the public market, the market price of Valemont Supply Inc.'s common stock could fall. Factors such as those discussed in this "Risk Factors" section may have a significant impact on the market price of Valemont Supply Inc.'s securities. Owing to the low price of the securities many brokerage firms may not be willing to effect transactions in the securities. Even if a purchaser finds a broker willing to effect a transaction in Valemont Supply Inc.'s common stock, the combination of brokerage commissions, state transfer taxes, if any, and other selling costs may exceed the selling price. Further, many lending institutions will not permit the use of such securities as collateral for loans. Thus, a purchaser may be unable to sell or otherwise realize the value invested in Valemont Supply Inc. stock. EVEN IF VALEMONT SUPPLY INC. IS APPROVED FOR QUOTATION BY A MARKET MAKER THROUGH THE NASD OVER-THE-COUNTER BULLETIN BOARD, INVESTORS MAY FACE DIFFICULTY SELLING THEIR SHARES. Even if Valemont Supply Inc. is approved for quotation by a marketmaker through the NASD over-the-counter bulletin board, stocks traded over this quotation system are usually thinly traded, highly volatile and not followed by analysts. Investors may therefore have difficulty selling their shares. INVESTORS MAY FACE SIGNIFICANT RESTRICTIONS ON THE RESALE OF VALEMONT SUPPLY INC. STOCK DUE TO STATE BLUE SKY LAWS Because Valemont Supply Inc.'s securities have not been registered for resale under the blue sky laws of any state, the holders of such shares and those persons desiring to purchase them in any trading market that may develop in the future should be aware that there may be significant state blue sky law restrictions on the ability of investors to sell and on purchasers to buy Valemont Supply Inc.'s securities. Investors may be unable to sell their stock in Valemont Supply Inc. Accordingly, investors should consider the secondary market for Valemont Supply Inc.'s securities to be a limited one. Investors may be unable to resell their stock without the significant expense of state registration or qualification. INVESTORS MAY FACE SIGNIFICANT RESTRICTIONS ON THE RESALE OF VALEMONT SUPPLY INC. STOCK DUE TO FEDERAL PENNY STOCK REGULATIONS Because Valemont Supply Inc.'s securities will constitute "penny stock" within the meaning of the rules, this may affect the ability of the owners of Valemont Supply Inc. shares to resell their securities. The Securities and Exchange Commission has adopted a number of rules to regulate "penny stocks." Such rules include Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 15g-7, and 15g-9 under the Securities and Exchange Act of 1934. The rules require broker-dealers to make certain disclosures regarding penny stocks to potential buyers, and make a determination based upon information provided by the potential buyer about such buyer's suitability for investing in penny stocks. Because Valemont Supply Inc.'s securities will constitute "penny stock" within the meaning of the rules, the rules would apply to Valemont Supply Inc. and its securities and there may be a limited market for penny stocks, due to the regulatory burdens on broker-dealers. INVESTORS MAY FACE SIGNIFICANT RESTRICTIONS ON THE RESALE OF VALEMONT SUPPLY INC. STOCK DUE TO THE WAY IN WHICH STOCK TRADES ARE HANDLED BY BROKER-DEALERS Because of large broker-dealer spreads, investors may be unable to sell the stock immediately back to the broker-dealer at the same price the broker-dealer sold the stock to the investor. In some cases, the stock may fall quickly in value. Investors may be unable to reap any profit from any sale of the stock, if they can sell it at all. The market among broker-dealers may not be active. Investors in penny stock often are unable to sell stock back to the dealer that sold them the stock. The mark ups or commissions charged by the broker-dealers may be greater than any profit a seller may make. THE MARKET FOR PENNY STOCKS HAS SUFFERED IN RECENT YEARS FROM PATTERNS OF FRAUD AND ABUSE, WHICH MAY CAUSE INVESTORS TO LOSE THEIR INVESTMENT Shareholders should be aware that, according to the Securities and Exchange Commission Release No. 34-29093, the market for penny stocks has suffered in recent years from patterns of fraud and abuse which could cause investors to lose their entire investment. Such patterns include: - - control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; - - manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; - - "boiler room" practices involving high pressure sales tactics and unrealistic price projections by inexperienced sales persons; - - excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and - - the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the inevitable collapse of those prices with consequent investor losses. IT WOULD BE DIFFICULT FOR INVESTORS TO INITIATE LEGAL ACTION AND ENFORCE JUDGMENTS AGAINST NON-U.S. RESIDENT EXECUTIVE OFFICERS OR DIRECTORS It would be difficult for investors to: - - Effect service of process within the United States on your non-U.S. resident executive officers or directors named in your registration statement; - - Enforce judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities laws against your non-U.S. resident executive officers or directors named in your registration statement; - - Enforce judgments of U.S. courts based on civil liability provisions of the U.S. federal securities laws in the Canadian court against your non-U.S. resident executive officers or directors named in your registration statement; and - - Bring an original action in the Canadian court to enforce liabilities based on the U.S. federal securities laws against your non-U.S. resident executive officers or directors named in your registration statement. OTHER RISKS YOU SHOULD NOT RELY ON FORWARD-LOOKING STATEMENTS BECAUSE THEY ARE INHERENTLY UNCERTAIN This prospectus contains forward-looking statements that involve risks and uncertainties. Valemont Supply Inc.'s actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by Valemont Supply Inc. described in "Risk Factors" and elsewhere in this prospectus. We use words such as "anticipates", "believes", "plans", "expects", "future", "intends" and similar expressions to identify these forward-looking statements. Prospective investors should not place undue reliance on these forward-looking statements, which apply only as of the date of this prospectus. USE OF PROCEEDS The net proceeds to Valemont Supply Inc. from the sale of the 1,000,000 shares of common stock offered by Valemont Supply Inc. hereby at an assumed initial public offering price of $.04 per share are estimated to be $40,000. Valemont Supply Inc. expects to use the net proceeds as follows:
Assuming Assuming Assuming Assuming sale of 10% sale of 25% sale of 50% sale of of stock of stock of stock 100% of being being being stock being Purpose offered offered offered offered - ------------------------------- ------------ ------------ ------------ ------------ Site visit Flag drill sites, clean up and re-cut claim lines, clean up previous trenching. . . . . . . $ 3,000 $ 3,000 $ 3,000 $ 3,000 Meet with local contactors (Valemont Area)Inspect equipment, interview management and check references. . . . . . . . . . . $ 1,000 $ 1,000 $ 1,000 $ 1,000 Exploration and verification of exploration history $ 6,000 $ 12,000 $ 15,000 Market Research Review of various trade shows to search for applicability to Valemont Supply Inc. $ 2,000 $ 4,000 Office Expenses . . . . . . . . $ 0 $ 0 $ 2,000 $ 5,000 Trade Shows . . . . . . . . . . $ 0 $ 0 $ 0 $ 7,000 Travel. . . . . . . . . . . . . $ 0 $ 0 $ 0 $ 5,000
Estimated offering expenses are as follows: SEC registration fee $ 10 Printing and engraving expenses 5,000 Attorneys' fees and expenses 4,000 Accountants' fees and expenses 2,000 Transfer agent's and registrar's fees and expenses 500 Miscellaneous 990 Total $12,500 Valemont Supply Inc. continually evaluates other business opportunities that may be available to it, whether in the form of assets acquisitions or business combinations. Valemont Supply Inc. may use a portion of the proceeds for these purposes. Valemont Supply Inc. is not currently a party to any contracts, letters of intent, commitments or agreements and is not currently engaged in active negotiations with respect to any acquisitions. DETERMINATION OF OFFERING PRICE Valemont Supply Inc. arbitrarily determined the price of the securities in this Offering. The offering price is not an indication of and is not based upon the actual value of Valemont Supply Inc. It bears no relationship to the book value, assets or earnings of Valemont Supply Inc. or any other recognized criteria of value. The offering price should not be regarded as an indicator of the future market price of the securities. DILUTION No sale of Valemont Supply Inc.'s common stock has ever been sold from one investor to another and the only issue of stock from treasury occurred on June 25, 2001 when a total of 8,000,000 shares of Valemont Supply Inc. common stock were issued at a price of $0.0058 per share. All stock was issued based on a valuation by the Board of Directors. The price of the securities in this Offering is $0.04 per share or $0.0342 per share higher. The net tangible book value of the Valemont Supply Inc. at October 31, 2001 was$0.0014 per share. "Net tangible book value per share" represents the amount of total tangible assets less total liabilities divided by the number of shares of Common Stock outstanding. After giving effect to the sale of all of the 1,000,000 shares offered pursuant to this Registration Statement at a price of $0.04 per share, the net tangible book value of the Valemont Supply Inc. as of October 31, 2001, after deducting offering costs, would be $50,973 or $0.0064 per share. This represents immediate dilution of $0.0336 per share to new investors and an immediate increase in net tangible book value per share of $0.0050 to existing stockholders. The following illustrates the per share dilution in this case: Share price: $0.0400 Net tangible book value before offering: $0.0014 Increase attributable to new investors: $0.0050 Net tangible book value after offering: $0.0064 Dilution to new investors: $0.0336 SELLING SHAREHOLDERS There are no selling security holders. PLAN OF DISTRIBUTION This is not an underwritten offering and there are no broker dealers involved in the selling efforts. This prospectus is part of a registration statement that permits Valemont Supply Inc. to sell a maximum of 1,000,000 shares of its common stock to the public on a direct participation basis. In accordance with Regulation M under the Exchange Act, we may not bid for, purchase or attempt to induce any person to bid for or purchase any of our common stock while we are selling stock in this offering. We do not intend to engage in any passive market making or undertake any stabilizing activity for our common stock. Valemont Supply Inc. will offer and sell its common stock through its sole officer and director, A.E. Daem, under the exemption from registration as a broker dealer under Rule 3a4-1 of the Exchange Act. All sales will be made in compliance with the securities laws of local jurisdictions. Mr. Daem will offer stock by delivering prospectuses to business associates with whom he has a pre-existing relationship. The gross proceeds to Valemont Supply Inc. will be $40,000 if all the shares offered are sold. No commissions or other fees will be paid, directly or indirectly, by Valemont Supply Inc., or any of its principals, to any person or firm in connection with solicitation of sales of the shares. Mr. Daem will be reimbursed for any expenses incurred in connection with this offering. Mr. Daem will not be allowed to purchase shares in this offering. While the registration statement is effective, new shareholders may sell their shares directly to the public, without the aid of a broker or dealer, or they may sell their shares through a broker or dealer if Valemont Supply Inc.'s stock is authorized for inclusion on the NASD over-the-counter bulletin board. Any commission, fee or other compensation of a broker or dealer would depend on the brokers or dealers involved in the transaction. No public market currently exists for shares of Valemont Supply Inc.'s common stock. Valemont Supply Inc. intends to apply to have its shares traded on the NASD over-the-counter bulletin board under the symbol "VALE". Valemont Supply Inc. has not taken any actions to have its shares traded on the NASD over-the-counter bulletin board. Valemont Supply Inc. intends to apply to have its shares traded on the NASD over-the-counter bulletin board immediately after it has met the listing standards for the NASD over-the-counter bulletin board as set out by the National Association of Stock Dealers. In the case of Valemont Supply Inc. these listing standards are: - - An effective Registration Statement Under The Securities Act of 1933 - - To remain current with its quarterly and annual report filings with the Securities and Exchange Commission - - At least one market maker to make a market in its securities Other than to remain current with its quarterly and annual report filings, Valemont Supply Inc. needs to achieve a sufficient number of shareholders to interest a market maker in making a market in its securities. There is no minimum number of shareholders required for a stock to trade on the NASD over-the-counter Bulleting Board. Valemont Supply Inc. anticipates that a registered offering by its selling shareholders may result in its stock being held by enough shareholders to interest a market maker to make a market in trading Valemont Supply Inc.'s stock. DESCRIPTION OF CAPITAL STOCK Valemont Supply Inc.'s authorized capital consists of 100,000,000 shares of common stock, par value $.0001 per share and 20,000,000 of preferred stock, par value $.0001 per share. Immediately prior to this offering, 8,000,000 common shares were issued and outstanding. Each record holder of common stock is entitled to one vote for each share held on all matters properly submitted to the shareholders for their vote. The articles of incorporation do not permit cumulative voting for the election of directors, and shareholders do not have any preemptive rights to purchase shares in any future issuance of Valemont Supply Inc.'s common stock. Because the holders of shares of Valemont Supply Inc.'s common stock do not have cumulative voting rights, the holders of more than 50% of Valemont Supply Inc.'s outstanding shares, voting for the election of directors, can elect all of the directors to be elected, if they so choose. In such event, the holders of the remaining shares will not be able to elect any of Valemont Supply Inc.'s directors. The holders of shares of common stock are entitled to dividends, out of funds legally available therefore, when and as declared by the Board of Directors. The Board of Directors has never declared a dividend and does not anticipate declaring a dividend in the future. In the event of liquidation, dissolution or winding up of the affairs of Valemont Supply Inc., holders are entitled to receive, ratably, the net assets of Valemont Supply Inc. available to shareholders after payment of all creditors. To the extent that additional shares of Valemont Supply Inc.'s common stock are issued, the relative interests of existing shareholders may be diluted. INTERESTS OF NAMED EXPERTS AND COUNSEL Neither Manning Elliott Chartered Accountants (Auditors) or Ogden Murphy Wallace (Legal Counsel) was employed on a contingent basis in connection with the registration or offering of Valemont Supply Inc.'s common stock. DESCRIPTION OF BUSINESS GENERAL Valemont Supply Inc. was incorporated under the laws of the State of Washington on June 25, 2001, and is in its early exploration stage. To date, Valemont Supply Inc.'s only activities have been organizational, directed at acquiring its mineral claims, raising its initial capital and exploration. Valemont Supply Inc. has not commenced commercial operations. Valemont Supply Inc. has no full time employees and owns no real estate. Valemont Supply Inc. intends to complete the exploration of its mineral claims its search for mica and to generally meet its future corporate obligations. PRODUCT DESCRIPTION Collectively the mineral claims make up mineralized materials whose primary mineral is mica. Mica has a number of end uses such as oil drilling muds, building products, paint, plastics, rubber and other end uses. - - Drilling muds for the oil and gas industry. Drilling muds are used to lubricate and seal drilling shafts when exploring for oil and gas. The muds have a natural tendency to flow into and seal cracks in the perimeter of the drill shaft preventing the influx of unwanted fluid into the shaft while drilling and possible loss of oil well control. The platy structure of mica added to drilling mud facilitates the overlapping of particles to form a layer or wall on the outside of the shaft, thereby preventing fluid influx. Low quality mica is consumed in oil wells where purity and color are not important. Generally the rock formations in North America are such that drilling mud is required to effectively drill for oil and gas. This is not generally the case in other oil drilling areas in the Middle East and the North Sea. Mica competes with several other products used in drilling mud, particularly a substance called bentonite. Bentonite is another mineral that is mined and has the same pliability, viscosity and lubrication properties as Mica. Consumption of mica in drilling muds is directly related to oil well drilling activity and the availability and cost of substitute products. Consumption by the oil and gas industry has grown substantially as a result of new drill programs being initiated throughout North America. This has been a direct result of high oil and gas prices and governments desire to become energy sufficient. - - Building Industry The largest market for mica is in the building industry. Mica is used: - In civil engineering applications including to strengthening and rebuilding bridges, water systems and highways. - As a filler and extender in joint cement, which is used to fill joints in the erection of gypsum plasterboard. When mica is mixed into the joint cement compound, it acts as a reinforcing agent and prevents cracking and peeling and reduces shrinkage. Consumption of mica in joint cement is closely related to the level of construction activity and the use of gypsum plasterboard by the construction industry. Use of plasterboard is common only in the North American construction industry. - - Insulating And Fireproofing Mica is used in the production of insulating and fireproof wallboards, particularly in the United Kingdom. Mica is used as an asbestos substitute due to its similar insulating and fire-resistant physical properties. Valemont Supply Inc. expects that the use of mica in wallboard will expand throughout North America, Europe and Japan due to its fire resistant properties. SHORT-TERM PLAN OF OPERATION FOR THE PERIOD ENDING OCTOBER 31, 2002 The initial step that Valemont Supply Inc. plans to take is to attempt to verify the previous mica discoveries. Valemont Supply Inc. then intends begin limited sales of raw mica to support the proving of commercial feasibility of the deposit. It is anticipated that this work program will cost approximately $18,000 and management believes that the proceeds of the offering will be more than sufficient to cover this and other cash requirements over the next six months The verification process may not yield results that are concurrent with previous findings in respect of the mica property. Valemont Supply Inc. recognizes this fact. To address this possibility, Valemont Supply Inc. does not discount other business opportunities that may be available to it, whether in the form of asset acquisitions or business combinations. Valemont Supply Inc.'s officer and director, A.E. Daem, may devote a portion of the time he devotes to Valemont Supply Inc. evaluating business opportunities that may be available. Valemont Supply Inc. has had no discussions with any third parties regarding business opportunities. Any asset acquisition or business combination would likely include the issuance of a significant amount of Valemont Supply Inc.'s common stock, which would dilute the ownership interest of holders of existing shares of Valemont Supply Inc.'s common stock. INDUSTRY CONDITIONS AND COMPETITION Because Valemont Supply Inc. is an exploration company that has acquired a property with mineralized material and does not at this time contemplate attempting to acquire other properties. Thus management feels that it has no real competitors with respect to property acquisitions. EMPLOYEES Valemont Supply Inc. is an exploration stage company and currently has no employees. A.E. Daem, its only officer and director, currently manages Valemont Supply Inc. Valemont Supply Inc. looks to Mr. Daem for his entrepreneurial and exploration skills and talents. He has extensive operating experience, covering a broad spectrum of businesses. His experience includes working as president and chief executive officer for a packaging company and most recently as the president and chief executive officer of an exploration company. Management plans to use consultants, attorneys and accountants as necessary and does not plan to engage any full-time employees in the near future. A portion of any future employee compensation likely would include the right to acquire stock in Valemont Supply Inc., which would dilute the ownership interest of holders of existing shares of Valemont Supply Inc.'s common stock. AVAILABLE INFORMATION Valemont Supply Inc. has filed with the Securities and Exchange Commission a registration statement on Form S-1 with respect to the common stock offered by this prospectus. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits and schedules which are parts of the registration statement. For further information with respect to Valemont Supply Inc. and its common stock, see the registration statement and the exhibits and schedules thereto. Any document Valemont Supply Inc. files may be read and copied at the Commission's Public Reference Room located at 450 Fifth Street N.W., Washington D.C. 20549, and the public reference rooms in New York, New York, and Chicago, Illinois. Please call the Commission at 1-800-SEC-0330 for further information about the public reference rooms. Valemont Supply Inc.'s filings with the Commission are also available to the public from the Commission's website at http://www.sec.gov. Upon completion of this offering, Valemont Supply Inc. will become subject to the information and periodic reporting requirements of the Securities Exchange Act and, accordingly, will file periodic reports, proxy statements and other information with the Commission. Such periodic reports, proxy statements and other information will be available for inspection and copying at the Commission's public reference rooms, and the website of the Commission referred to above. DESCRIPTION OF PROPERTY Valemont Supply Inc.'s mineral claims are located in the Cariboo Mining District of British Columbia, Canada. Specifically, the property lies at latitude 52o 46'N and longitude 119o 18'W. eight km south of Valemont, B.C., and the mineral title reference is: Map. 083D14W U.T.M. Zone 11 Administrative Area Mining Division: District 2075 Mining Dist. 03 - Cariboo Access to the claims area is by an all weather road that connects directly to a highway. The road dissects Valemont Supply Inc.'s mineral claims and is maintained by the British Columbia Department of Highways. The main line of the Canadian National Railway is 2km East of the Mica deposit located on the property. For power the Avola-Valemont transmission line crosses the property. For water the Canoe River flows along the South boundary of the property. To maintain the claims on an annual basis Valmont Supply Ltd. must perform a minimum of two hundred Canadian dollars per claim of validated work plus pay a ten Canadian dollar per claim registration fee to the Provincial Government. Cash may be paid in lieu of work. If the property is put into production a Royalty payment of two US dollars per ton is due the former owner. The mica in this property was discovered in 1961. Prior to being acquired by Valemont Supply Inc., much work was carried out in order to better understand the exact nature and location of the mica found on the property. This work included: Surface exploration and geochemistry - - Several trenches were dug and bulk samples taken. - - In addition several drill holes were made with assay results indicating the property owned by Valemont Supply Inc. contains a mineralized material of 2,286,000 tons of mica accessible to open pit recovery - - Metallurgical test conducted in 1981 at Bacon, Donaldson laboratories in Vancouver, with input from Kilborn engineering, on behalf of Brinco Mining Ltd verified a the mineralized material. - - A small-scale mining project was carried out in 1987 by Beaty Geological Ltd on behalf of Lico Resources Inc and Technigen Platinum Corporation Resulting in four 60-70 ton bulk samples and six diamond drill holes being drilled which further outlined and exposed the deposit for the current owners, Valemont Supply Ltd. No work has been done by Valemont Supply Inc. on the property. Valemont Supply Inc.'s proposed program of exploration includes engaging professionals to review the previous findings of mineralized materials with respect to the property. This will encompass the following: - - Walk the claims making sure the lines are clear of underbrush and to check the condition of the staking posts, the metal claim tags and numbers on each post - - Verify and validate all the data Valemont Supply Inc. has compiled on the claims. This work history goes back forty years to 1961. o Valemont Supply Inc. will try to locate bulldozer trenching to take samples. o Valemont Supply Inc. will try to locate some of the 18 short holes drilled to see of any of the core is available for sampling - - During a 1978 summer program several small pits were dug o Valemont Supply Inc. will try to locate some of these pits for sampling. If the pits are in unusable condition Valemont Supply Inc. will dig several sample pits for sampling o Valemont Supply Inc. will try to locate the areas of the two drill programs carried out in 1978 with the object of finding core for sampling. The drill locations will be cleaned up and marked for use if further validation is necessary - - Valemont Supply Inc. will conduct a thorough outcrop search of the property mapping and samplings were appropriate. - - The two new roads cut in the area will be examined and sampled should they prove of interest. Valemont Supply Inc.'s property is without known reserves and the proposed program is exploratory in nature. Once the foregoing has been completed and analyzed to verify the existing reports, Valemont Supply Inc. hopes to determine if its mineral deposit is economically and legally viable. Valemont Supply Inc. acquired the Valemont mineral claims from Mr. Douglas Payne in an arms length transaction.The mineralized material is exposed in sparse outcrops and in trenches excavated by a mining company in l981. Drilling has encountered three beds of mineralized material striking northeasterly and dipping shallowly northwestward into the moderately south sloping hillside. The top bed varies from 15 m to 25 m thick (averaging 17 m) and contains an average mica content of 60.6%. Continuity of the mica bed is open to the southwest where, management feels that, future drilling could define another 1,000,000 tons. The mica bed also continues to the northwest but management feels that increasingly thick hard surface materials would increase the waste produced when mined, making it less economic and thus more expensive to mine. The mica content is variable throughout the extent of the three beds of mica. In order to confirm the mica content, six holes were drilled in January-February 1987 to provide more information. Analytical results indicate that the percentage of mica averages 56.1%. The analysis indicates that the total percentage of mica appears to increase to the east. Valemont Supply Inc. currently maintains limited office space, occupied by Mr. Daem, for which it pays no rent. Its address is 6779 Blackwell Rd, Kamloops, British Columbia V2C 6V7, Canada, and its phone number is ((604) 681 6599. Valemont Supply Inc. does not believe that it will need to obtain additional office space at any time in the foreseeable future until its business plan is more fully implemented, at which time it may need office facilities. LEGAL PROCEEDINGS Valemont Supply Inc. is not a party to any material pending legal proceedings, and none of its property is the subject of a pending legal proceeding. Further, the officer and director knows of no legal proceedings against Valemont Supply Inc. or its property contemplated by any governmental authority. MARKET PRICE OF AND DIVIDENDS ON CAPITAL STOCK AND OTHER SHAREHOLDER MATTERS No established public trading market exists for Valemont Supply Inc.'s securities. Valemont Supply Inc. has no common equity subject to outstanding purchase options or warrants. Valemont Supply Inc. has no securities convertible into its common equity. There is no common equity that could be sold pursuant to Rule 144 under the Securities Act or that, except for this offering; Valemont Supply Inc. has agreed to register under the Securities Act for sale by shareholders. Except for this offering, there is no common equity that is being, or has been publicly proposed to be, publicly offered by Valemont Supply Inc. The principal operations of Valemont Supply Inc. have not yet commenced. Valemont Supply Inc. has 8,000,000 shares of common stock issued and outstanding, all of which were issued to Valemont Supply Inc.'s president and sole director on June 25, 2001 at $0.0058 per share. All stock was issued based on a valuation by the Board of Directors. No sale of Valemont Supply Inc.'s common stock has ever been sold from one investor to another. Upon effectiveness of the registration statement that includes this prospectus, 1.0 million shares of Valemont Supply Inc. will be eligible for sale from Valemont Supply Inc.'s treasury. To date Valemont Supply Inc. has not paid any dividends on its common stock and does not expect to declare or pay any dividends on its common stock in the foreseeable future. Payment of any dividends will depend upon Valemont Supply Inc.'s future earnings, if any, its financial condition, and other factors as deemed relevant by the Board of Directors. SELECTED FINANCIAL DATA The following selected financial data should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements appearing elsewhere in this prospectus. The statement of operations data set forth below for the period from June 25, 2001, (inception) to the three months ended, and the balance sheet data at October 31, 2001, are derived from Valemont Supply Inc.'s unaudited 1st quarter 2002 financial statements included elsewhere in this prospectus. The historical results are not necessarily indicative of results to be expected for any future period.
Inception to October 31, 2001 ----------------- STATEMENT OF OPERATIONS DATA: Net sales . . . . . . . . . . . . . . . . $ Nil ================= Loss from continuing operations . . . . . $ 10,027 ================= Loss per share from continuing operations $ Nil ================= As of October 31, 2001 BALANCE SHEET DATA: Total assets. . . . . . . . . . . . . . . $ 40,973 ================= Total liabilities . . . . . . . . . . . . $ 1,198 =================
Valemont Supply Inc. is in its early exploration and promotional stages. To date, Valemont Supply Inc.'s only activities have been organizational, directed at acquiring its mineral claims, raising its initial capital and exploration. Valemont Supply Inc. has not commenced commercial operations. As a result, the selected financial data presented above bear no resemblance to the results that Valemont Supply Inc. expects when it begins operations. See "Risk Factors," "Description of Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations." MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS During the period from June 25, 2001, (inception) through the six months ended January 31, 2002, Valemont Supply Inc. has engaged in no significant operations other than organizational activities, acquisition of a Mica property and preparation for registration of its securities under the Securities Act of 1933. Valemont Supply Inc. received no revenues during this period. Valemont Supply Inc.'s operations in the upcoming twelve-month period will vary based on the receipt of funding that is not assured to be received. As a result Valemont Supply Inc.'s auditor has indicated that there is substantial doubt regarding Valemont Supply Inc.'s ability to continue as a going concern and has expressed this opinion in their audit report on the July 31, 2001 financial statements. Regardless of whether funding is received in the upcoming twelve-month period Valemont Supply Inc. anticipates incurring a loss as a result of organizational expenses, expenses associated with registration under the Securities Act of 1933, and expenses associated with setting up a company structure to begin implementing its business plan. The costs associated with filing this registration statement, and Valemont Supply Inc.'s expenses associated with applying for Valemont Supply Inc.'s shares to trade on the OTC bulletin board are not expected to exceed $9,500 and will be expensed. The extent of these costs will depend primarily on the states in which a market maker would want Valemont Supply Inc.'s shares to be qualified. Valemont Supply Inc. intends to continue the exploration of its property, in an attempt to establish mica reserves, and to generally meet its future corporate obligations. Valemont Supply Inc. anticipates that until these procedures are completed it will not generate revenues, and may continue to operate at a loss thereafter, depending upon the performance of the business. Valemont Supply Inc. anticipates that the offering will take about 5 months beginning after the completion of this registration statement. The following table illustrates how Valemont Supply Inc. has budgeted its cash on hand over the upcoming twelve-month period assuming various funding levels received:
Assuming Assuming Assuming Assuming sale of 10% sale of 25% sale of 50% sale of of stock of stock of stock 100% of being being being stock being Purpose offered offered offered offered - -------------------------------- ------------ ------------ ------------ ------------ Printing . . . . . . . . . . . . $ 1,000 $ 1,000 $ 1,000 $ 1,000 Attorneys' fees and expenses . . 439 439 439 439 Accountants' fees and expenses . 500 500 500 500 Transfer agent's and registrar's fees and expenses. . . . . . . . 300 300 300 300 Site visit . . . . . . . . . . . 3,000 3,000 3,000 3,000 Meet with local contactors . . . 1,000 1,000 1,000 1,000 Exploration and verification of exploration history. . . . . . . 0 6,000 12,000 15,000 Market Research. . . . . . . . . 0 0 2,000 4,000 Office Expenses. . . . . . . . . 0 0 2,000 5,000 Trade Shows. . . . . . . . . . . 0 0 0 7,000 Travel . . . . . . . . . . . . . 0 0 0 5,000 Working capital - -------------------------------- ------------ ------------ ------------ ------------ Total cash on hand and prepaid expenses . . . . . . . . . . . . $ 6,239 $ 12,239 $ 22,239 $ 52,239 - -------------------------------- ------------ ------------ ------------ ------------
Valemont Supply Inc. therefore anticipates satisfying its cash requirements over the next 12 months in both full funding and no funding scenarios. Over the upcoming twelve-month period Valemont Supply Inc.: - - does not intend to perform any product research and development; - - does not expect to purchase any significant plant or equipment; and - - other than new sales staff does not expect any significant changes in the number of employees LIQUIDITY AND CAPITAL RESOURCES Valemont Supply Inc. remains in the exploration stage and, since inception, has experienced no significant change in liquidity or capital resources or shareholders' equity. Consequently, Valemont Supply Inc.'s balance sheet as of October 31, 2001, reflects total assets of $9,739 in the form of cash. Valemont Supply Inc. expects to carry out its plan of business discussed above. In addition, Valemont Supply Inc. may engage in a combination with another business. Valemont Supply Inc. cannot predict the extent to which its liquidity and capital resources will be diminished prior to the consummation of a business combination or whether its capital will be further depleted by the operating losses (if any) of the business entity with which Valemont Supply Inc. may eventually combine. Valemont Supply Inc. has not engaged in discussions concerning potential business combinations and there currently are no business acquisitions that are probable. The conditions or events that would cause Valemont Supply Inc. to engage in business combination with another business include: Valemont Supply Inc. may not be successful in developing a viable market for its products due to its limited financial resources, the only way Valemont Supply Inc. will be able to diversify its activities, should its business plan prove to be impractical, would be to enter into a business combination. Valemont Supply Inc. has no specific long-term capital requirements. If Future sales do occur, it is expected that these future costs of sales including product extraction costs and commissions are payable after the time that Valemont Supply Inc. expects to be paid by its customer. Valemont Supply Inc. therefore plans to generate sufficient cash flow from sales to meet its long-term requirements. Valemont Supply Inc. may need additional capital to carry out its business plan or to engage in a business combination. In the event that Valemont Supply Inc. requires more capital, no commitments to provide additional funds have been made by management or other shareholders. Accordingly, there can be no assurance that any additional funds will be available on terms acceptable to Valemont Supply Inc. or at all. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Manning Elliott Chartered Accountants has served as Valemont Supply Inc.'s independent auditor since inception, and Valemont Supply Inc. has not had any dispute with Manning Elliott Chartered Accountants over accounting or financial disclosure. DIRECTORS AND EXECUTIVE OFFICERS The following table sets forth the name, age and position of each director and executive officer of Valemont Supply Inc.: NAME AGE POSITION - ---------- --- -------------------------------------------- A.E. Daem 64 President, Secretary, Treasurer, Director - ---------- --- -------------------------------------------- Mr. Daem became a director and officer of Valemont Supply Inc. in June 2001. In 1960, Mr. Daem graduated from the University of British Columbia with a degree in Science and Pharmacy. During the last 15 years, Mr. Daem has worked for Circle Drugs Inc, a private company, as director, president and chief executive officer, growing the retail chain while maintaining profitability. Mr. Daem also worked for Air packaging International a public company from 1989 to 1991 as director, president and chief operating officer; a packaging company which has developed a number of packaging products. Mr. Daem worked from 1991 to 1999 as president, director and chief executive officer of International Tournigan Inc, a public exploration company searching for minerals. Through International Tournigan Inc. Mr. Daem has the experience of financing, administration and engaging and managing the activities of numerous professional engineers and geologists in the search for minerals in Canada, Unites States, Africa, Papua New Guinea and Peru. Mr. Daem is also the sole shareholder of Armanda International Trader Inc. in which he conducts his private passive investment business. Mr. Daem devotes approximately 40% of his time to his position in Valemont Supply Inc., in the areas of finance, administration and exploration coordination. The director named above will serve until the first annual meeting of Valemont Supply Inc.'s shareholders. Thereafter, directors will be elected for one-year terms at the annual shareholders' meeting. Officers will hold their positions at the pleasure of the board of directors. No employment agreements currently exist or are being contemplated. There is no arrangement or understanding between the director and officer of Valemont Supply Inc. and any other person pursuant to which any director or officer is to be selected as a director or officer. The directors and officers of Valemont Supply Inc. will devote their time to Valemont Supply Inc.'s affairs on an "as needed" basis. As a result, the actual amount of time that they will devote to Valemont Supply Inc.'s affairs is not consistent and is likely to vary substantially from month to month. EXECUTIVE COMPENSATION No officer or director has received any remuneration from Valemont Supply Inc. Although there is no current plan in existence, it is possible that Valemont Supply Inc. will adopt a plan to pay or accrue compensation to its officers and directors for services related to the implementation of Valemont Supply Inc.'s business plan. Valemont Supply Inc. has no stock option, retirement, incentive, defined benefit, actuarial, pension or profit-sharing programs for the benefit of directors, officers or other employees, but the Board of Directors may recommend adoption of one or more such programs in the future. Valemont Supply Inc. has no employment contract or compensatory plan or arrangement with any executive officer of Valemont Supply Inc. The Director currently does not receive any cash compensation from Valemont Supply Inc. for his service as members of the board of directors. There is no compensation committee, and no compensation policies have been adopted. See "Certain Relationships and Related Transactions." SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth, as of October 31, 2001: - - Valemont Supply Inc.'s outstanding common stock owned or beneficially owned by each executive officer and director; - - Valemont Supply Inc.'s outstanding common stock owned or beneficially owned by each person who owned of record, or was known by Valemont Supply Inc.to own beneficially, more than 5% of Valemont Supply Inc.'s common stock; - - The shareholdings of all executive officers and directors as a group.
Percentage of Outstanding Name Shares Owned Shares Owned - ------------------------------------------------------------ ------------ -------------- A.E. Daem, President, Secretary, Treasurer, and Director Kamloops, B.C. Canada . . . . . . . . . . . . . . . . . . . 8,000,000 100% - ------------------------------------------------------------ ------------ -------------- All Executive Officers & Directors As A Group (1 Individual) 8,000,000 100% - ------------------------------------------------------------ ------------ --------------
All shares are held of record and each record shareholder has sole voting and investment power. Valemont Supply Inc. knows of no one who has the right to acquire beneficial ownership in Valemont Supply Inc. common stock. Other than the sale of Valemont Supply Inc. stock contemplated by this prospectus, there are no arrangements known to Valemont Supply Inc. the operation of which may at a subsequent date result in a change of control of Valemont Supply Inc. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS No director, executive officer or nominee for election as a director of Valemont Supply Inc., and no owner of five percent or more of Valemont Supply Inc.'s outstanding shares or any member of their immediate family has entered into or proposed any transaction in which the amount involved exceeds $60,000. A.E. Daem is the only promoter of Valemont Supply Inc. Other than the 8,000,000 shares issued to Mr. Daem in exchange for $46,000 upon inception of Valemont Supply Inc., there has been nothing of value (including money, property, contracts, options, or rights of any kind) received or to be received by Mr. Daem, directly or indirectly, from the Valemont Supply Inc. Valemont Supply Inc. has not received any other assets, services or other consideration as a result. Valemont Supply Inc. arbitrarily determined the price of the shares issued to Mr. Daem. DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES Valemont Supply Inc.'s bylaws provide that Valemont Supply Inc. will indemnify its officers and directors for costs and expenses incurred in connection with the defense of actions, suits, or proceedings against them on account of their being or having been directors or officers of Valemont Supply Inc., absent a finding of negligence or misconduct in the performance of duty. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling Valemont Supply Inc. pursuant to the forgoing provisions, Valemont Supply Inc. has been informed that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in that Act and is, therefore, unenforceable. INDEX TO FINANCIAL STATEMENTS Valemont Supply Inc. (An Exploration Stage Company) THREE MONTHS ENDED OCTOBER 31, 2001 (UNAUDITED) AND JUNE 25, 2001 (DATE OF INCEPTION) TO OCTOBER 31, 2001 Interim Balance Sheet F-2 Interim Statement of Operations F-3 Interim Statement of Cash Flows F-4 Notes to the Interim Financial Statements F-5 to F-6 JUNE 25, 2001 (DATE OF INCEPTION) TO JULY 31, 2001 Independent Auditor's Report F-7 Balance Sheet F-8 Statement of Operations F-9 Statement of Stockholders' Equity F-10 Statement of Cash Flows F-11 Notes to the Financial Statements F-12 to F-14 F-1
Valemont Supply Inc. (An Exploration Stage Company) Interim Balance Sheets (expressed in U.S. dollars) January 31, July 31, 2001 2001 $ $ (unaudited) (audited) ----------- ASSETS Current Assets Cash 2,239 2,823 Prepaid expenses 7,500 10,000 - ------------------------------------------------------------------------------------- Total Current Assets 9,739 12,823 - ------------------------------------------------------------------------------------- Total Assets 9,739 12,823 ===================================================================================== LIABILITIES Current Liabilities 1,198 - - ------------------------------------------------------------------------------------- Contingency (Note 1) STOCKHOLDERS' EQUITY Stockholders' Equity Common Stock: 100,000,000 common shares authorized with a parvalue of $0.0001; 8,000,000 issued and outstanding 800 800 Additional Paid-in Capital 45,200 45,200 Donated Capital (Note 4) 8,750 1,250 - ------------------------------------------------------------------------------------- 54,750 47,250 - ------------------------------------------------------------------------------------- Preferred Stock: 20,000,000 preferred shares authorized with a par value of $.0001; none issued - - - ------------------------------------------------------------------------------------- Deficit Accumulated During the Exploration Stage (46,209) (34,427) - ------------------------------------------------------------------------------------- Total Stockholders' Equity 8,541 12,823 - ------------------------------------------------------------------------------------- Total Liabilities and Stockholders' Equity 9,739 12,823 ===================================================================================== The accompanying notes are an integral part of these financial statements F-2
Valemont Supply Inc. (An Exploration Stage Company) Interim Statement of Operations (expressed in U.S. dollars) (unaudited) Accumulated from Six Months Accumulated from June 25, 2001 Ended January 31, June 25, 2001 (Date of Inception) (Date of Inception) to January 31, 2002 2002 to July 31, 2001 $ $ $ Revenue - ------------------------------------------------------------------------------------------------------------- Expenses Communication 1,198 1,198 Consulting 7,000 6,000 1,000 Mineral property acquisition costs (Note 3) 30,000 - 30,000 Professional fees 6,261 3,084 3,177 Rent 1,750 1,500 250 - ------------------------------------------------------------------------------------------------------------- 46,209 11,782 34,427 - ------------------------------------------------------------------------------------------------------------- Net Loss for the Period (46,209) (11,782) (34,437) Deficit - Beginning of Period - (34,427) - - ------------------------------------------------------------------------------------------------------------- Deficit - End of Period (46,209) (46,209) (34,437) ============================================================================================================= Net Loss Per Share - Basic (0.01) ============================================================================================================= Weighted Average Shares Outstanding 8,000,000 ============================================================================================================= The accompanying notes are an integral part of these financial statements F-3
Valemont Supply Inc. (An Exploration Stage Company) Interim Statement of Cash Flows (expressed in U.S. dollars) (unaudited) Six Months Ended January 31, 2002 $ Cash Flows To Operating Activities Net loss (11,782) Non-cash items Donated consulting services 6,000 Donated rent 1,500 Adjustments to reconcile net loss to cash Prepaid expenses 2,500 Accounts payable 1,198 - -------------------------------------------------------- Net Cash Used In Operating Activities (584) - -------------------------------------------------------- Net Decrease in Cash (584) Cash - Beginning of Period 2,823 - -------------------------------------------------------- Cash - End of Period. . . . . . . . . . . 2,239 ======================================================== Non-Cash Financing Activities - ======================================================== Supplemental Disclosures Interest paid - Income taxes paid - ========================================================
The accompanying notes are an integral part of these financial statements F-4 VALEMONT SUPPLY, INC. (AN EXPLORATION STAGE COMPANY) Notes to Interim Financial Statements (Expressed in U.S. dollars) JANUARY 31, 2002 1. Exploration Stage Company The Company was incorporated in the state of Washington on June 25, 2001. On June 26, 2001 the Company purchased Mica Mineral Claims, situated in the Cariboo Mining Division in the Province of British Columbia, Canada. Mica is mainly used in the oil and gas industry, in the form of oil drilling mud, to lubricate the shafts of drilling rigs. The Company's principal business plan is to continue exploration of its property in order to confirm the mica content of mineralized materials found there and to ultimately seek earnings by exploiting any mica available from the mineral claims. The Company currently has yet to generate any revenues and in accordance with SFAS No. 7, is considered an exploration stage company. At present, management devotes most of its activities in becoming a public company which will allow the Company to raise sufficient funds to explore their Mica property. Planned principal activities have not yet begun. The ability of the Company to emerge from the exploration stage with respect to any planned principal business activity is dependent upon its successful efforts to raise additional equity financing and/or attain profitable operations. There is no guarantee that the Company will be able to raise any equity financing or successfully explore the Mica property and thus extract and sell Mica at a profit. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. 2. Summary of Significant Accounting Principles a) Year End The Company's year-end is July 31 b) Use of 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. c) Basic Earnings (Loss) Per Share Basic earnings (loss) per share have been calculated in conformity with Financial Accounting Standards Board Statement No. 128 "Earnings per Share". The Company has a simple capital structure without potential common shares. Basic earnings (loss) per share is calculated on the weighted average number of common shares outstanding each year. d) Mineral Properties The Company is in the exploration stage and all costs relating to mineral property grassroots exploration are charged to operations as incurred. F-5 VALEMONT SUPPLY, INC. (AN EXPLORATION STAGE COMPANY) Notes to Interim Financial Statements (Expressed in U.S. dollars) JANUARY 31, 2002 3. Prepaid expenses Prepaid expenses represent a single payment to a company that provides legal, accounting and electronic filing services 4. Mineral Properties Pursuant to a sales agreement dated June 26, 2001, the Company acquired 12 mineral claims containing a mica mineral deposit. The mineral property is located in the Cariboo Mining Division in the Province of British Columbia. Consideration paid was $30,000 and an exclusive right to a Royalty on the mica produced from the mica claims in the amount of US$2.00 per ton of pit run of mica containing ore extracted from the mica claims. This payment constitutes a net royalty payment to the vendor. This payment is to be made within 30 days of the pit run mica leaving the mica claims. The price per ton will be negotiated every five years. The mica in this property was first discovered in 1961 and prior to acquiring the property previous owners performed an exploration program in order to better understand the nature and location of the mica. This exploration included trenching, bulk sampling and several assayed drill holes. This exploration program verified a commercially acceptable grade of mica accessible to open pit recovery. In 1987 a small-scale mining project was carried out resulting in four bulk samples of 60 to 70 tons each and six diamond drill holes being drilled. This project outlined and exposed the deposit further. The Company has not measured the deposit for proven recoverable mica. Pursuant to the Company's accounting policy on mineral properties the acquisition costs of $30,000 have been charged to operations as persuasive engineering evidence has not yet been obtained to prove recoverable mica reserves exist. 5. Related Party Transactions The President of the Company has donated services valued at $1,000 per month and rent valued at $250 per month. These amounts have been charged to operations and classified as "donated capital" in shareholders' equity. F-6 INDEPENDENT AUDITORS' REPORT To the Board of Directors Valemont Supply Limited (An Exploration Stage Company) We have audited the accompanying balance sheet of Valemont Supply Limited (An Exploration Stage Company) as of July 31, 2001 and the related statements of operations, stockholders' equity and cash flows for the period from June 25, 2001 (Date of Inception) to July 31, 2001. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with U.S. generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the aforementioned financial statements present fairly, in all material respects, the financial position of Valemont Supply Limited (An Exploration Stage Company), as of July 31, 2001, and the results of its operations and its cash flows for the period from June 25, 2001 (Date of Inception) July 31, 2001, in conformity with U.S. generally accepted accounting principles. The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has not generated any revenues or conducted any operations since inception. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also discussed in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. /S/ "MANNING ELLIOTT" CHARTERED ACCOUNTANTS Vancouver, Canada September 21, 2001 F-7
Valemont Supply Limited (An Exploration Stage Company) Balance Sheet (expressed in U.S. dollars) July 31, 2001 $ ASSETS Current Assets Cas 2,823 Prepaids 10,000 - ------------------------------------------------------------------------------------------------------------------- Total Assets 12,823 =================================================================================================================== LIABILITIES Current Liabilities - - ------------------------------------------------------------------------------------------------------------------- Contingency (Note 1) STOCKHOLDERS' EQUITY Stockholders' Equity Common Stock, par value $0.0001; 100,000,000 shares authorized; 8,000,000 shares issued and outstanding. 800 Additional Paid-in Capital 45,200 Donated Capital (Note 4) 1,250 - ------------------------------------------------------------------------------------------------------------------- 47,250 - ------------------------------------------------------------------------------------------------------------------- Preferred Stock, par value of $0.0001; 20,000,000 shares authorized; none issued - - ------------------------------------------------------------------------------------------------------------------- Deficit Accumulated During the Exploration Stage (34,427) - ------------------------------------------------------------------------------------------------------------------- Total Stockholders' Equity 12,823 - ------------------------------------------------------------------------------------------------------------------- Total Liabilities and Stockholders' Equity 12,823 ===================================================================================================================
The accompanying notes are an integral part of these financial statements F-8
Valemont Supply Limited (An Exploration Stage Company) Statement of Operations (expressed in U.S. dollars) Accumulated from June 25, 2001 (Date of Inception) to July 31, 2001 $ Revenue - - ----------------------------------------------------------------- Expenses Consulting 1,000 Mineral property acquisition costs (Note 3) 30,000 Professional fees 3,177 Rent 250 - ----------------------------------------------------------------- 34,427 - ----------------------------------------------------------------- Net Loss for the Period (34,427) ================================================================= Net Loss Per Share - Basic (0.01) ================================================================= Weighted Average Shares Outstanding 8,000,000 ================================================================= (Diluted loss per share has not been presented as the result is anti-dilutive)
The accompanying notes are an integral part of these financial statements F-9
Valemont Supply Limited (An Exploration Stage Company) Statement of Cash Flows (expressed in U.S. dollars) Accumulated from June 25, 2001 (Date of Inception) to July 31, 2001 $ Cash Flows To Operating Activities Net loss (34,427) Non-cash items Donated consulting services 1,000 Donated rent 250 Adjustment to reconcile net loss to cash Prepaids (10,000) - --------------------------------------------------------------- Net Cash Used In Operating Activities (43,177) - --------------------------------------------------------------- Cash Flows From Financing Activities Sale of capital stock 46,000 - --------------------------------------------------------------- Net Cash Provided By Financing Activities 46,000 - --------------------------------------------------------------- Net Increase in Cash 2,823 Cash - Beginning of Period. - - --------------------------------------------------------------- Cash - End of Period 2,823 =============================================================== Non-Cash Financing Activities - =============================================================== Supplemental Disclosures Interest paid - Income taxes paid - ===============================================================
The accompanying notes are an integral part of these financial statements F-10
Valemont Supply Limited (An Exploration Stage Company) Statement of Stockholders' Equity From June 25, 2001 (Date of Inception) to July 31, 2001 (expressed in U.S. dollars) Deficit Accumulated Additional During the Paid-in Donated Exploration Shares Amount Capital Capital Total Stage # $ $ $ $ $ Balance - June 25, 2001 (Date of Inception) - - - - - - Stock issued on June 25, 2001 for cash 8,000,000 800 45,200 - 46,000 - Value of rent donated by related party - - - 250 250 - Value of services donated by related party. - - - 1,000 1,000 - Net loss for the period (34,427) - -------------------------------------------------------------------------------------------------------------- Balance - July 31, 2001 8,000,000 800 45,200 1,250 47,250 (34,427) ==============================================================================================================
The accompanying notes are an integral part of these financial statements F-11 VALEMONT SUPPLY, INC. (A EXPLORATION STAGE COMPANY) Notes to Financial Statements (Expressed in U.S. dollars) July 31, 2001 1. Exploration Stage Company The Company was incorporated in the state of Washington on June 25, 2001. On June 26, 2001 the Company purchased twelve mica mineral claims, situated in the Cariboo Mining Division in the Province of British Columbia, Canada. Mica is mainly used in the oil and gas industry, in the form of oil drilling mud, to lubricate the shafts of drilling rigs. The Company's principal business plan is to continue exploration of its property in order to confirm the mica content of mineralized materials found there and to ultimately seek earnings by exploiting any mica available from the mineral claims. The Company is an exploration stage company. At present, management devotes most of its activities in becoming a public company which will allow the Company to raise sufficient funds to further explore the mica property. Planned principal activities have not yet begun. The ability of the Company to emerge from the exploration stage with respect to any planned principal business activity is dependent upon its successful efforts to raise additional equity financing and/or attain profitable operations. There is no guarantee that the Company will be able to raise any equity financing or successfully explore the mica property to thus be able to extract and sell mica at a profit. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. 2. Summary of Significant Accounting Principles a) Year End The Company's year end is July 31. b) Use of 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. c) Basic Earnings (Loss) Per Share Basic earnings (loss) per share have been calculated in conformity with Financial Accounting Standards Board Statement No. 128 "Earnings per Share". The Company has a simple capital structure without potential common shares. Basic earnings (loss) per share is calculated on the weighted average number of common shares outstanding each year. d) Mineral Properties The Company is in the exploration stage and all costs relating to mineral property grassroots exploration are charged to operations as incurred. e) Income Taxes The Company has adopted the provisions of Financial Accounting Standards Board Statement No. 109 (SFAS 109), Accounting for Income Taxes. Pursuant to SFAS 109 the Company is required to compute tax asset benefits for net operating loss carry forwards. Potential benefit of net operating losses has not been recognized in the financial statements because the Company cannot be assured that it is more likely than not that it will utilize the net operating loss carry forwards in future years. The Company has a tax loss of $4,427 to offset future years taxable income expiring in fiscal 2016. F-12 VALEMONT SUPPLY, INC. (A EXPLORATION STAGE COMPANY) Notes to Financial Statements (Expressed in U.S. dollars) July 31, 2001 Summary of Significant Accounting Principles (continued) The components of the net deferred tax asset, the statutory tax rate, the effective tax rate and the elected amount of the valuation allowance are scheduled below: 2001 $ Net Operating Losses 4,427 Statutory Tax Rate 34% Effective Tax Rate - Deferred Tax Asset 1,505 Valuation Allowance (1,505) - -------------------------------------------------------------------------------- Net Deferred Tax Asset - ================================================================================ 3. Prepaid expenses Prepaid expenses represent a single payment to a company that provides legal, accounting and electronic filing services 4. Mineral Properties Pursuant to a sales agreement dated June 26, 2001, the Company acquired 12 mineral claims containing a mica mineral deposit. The mineral property is located in the Cariboo Mining Division in the Province of British Columbia. Consideration paid was $30,000 and an exclusive right to a Royalty on the mica produced from the mica claims in the amount of US$2.00 per ton of pit run of mica containing ore extracted from the mica claims. This payment constitutes a net royalty payment to the vendor. This payment is to be made within 30 days of the pit run mica leaving the mica claims. The price per ton will be negotiated every five years. The mica in this property was first discovered in 1961 and prior to acquiring the property previous owners performed an exploration program in order to better understand the nature and location of the mica. This exploration included trenching, bulk sampling and several assayed drill holes. This exploration program verified a commercially acceptable grade of mica accessible to open pit recovery. In 1987 a small-scale mining project was carried out resulting in four bulk samples of 60 to 70 tons each and six diamond drill holes being drilled. This project outlined and exposed the deposit further. The Company has not measured the deposit for proven recoverable mica. Pursuant to the Company's accounting policy on mineral properties the acquisition costs of $30,000 have been charged to operations as persuasive engineering evidence has not yet been obtained to prove recoverable mica reserves exist. 5. Related Party Transactions The President of the Company has donated services valued at $1,000 per month and rent valued at $250 per month. These amounts have been charged to operations and classified as "donated capital" in shareholders' equity. F-13 PROSPECTUS APRIL 4, 2002 VALEMONT SUPPLY INC. 6779 BLACKWELL RD KAMLOOPS, BRITISH COLUMBIA V2C 6V7, CANADA (250) 519 0553 (250) 519-0449 1,000,000 Shares of Common Stock to be sold by current shareholders Valemont Supply Inc. has not authorized any dealer, salesperson or other person to give you written information other than this prospectus or to make representations as to matters not stated in this prospectus. You must not rely on unauthorized information. This prospectus is not an offer to sell these securities or a solicitation of your offer to buy the securities in any jurisdiction where that would not be permitted or legal. Neither the delivery of this prospectus nor any sales made hereunder after the date of this prospectus shall create an implication that the information contained herein or the affairs of Valemont Supply Inc. have not changed since the date hereof. Until July 4, 2002 (90 days after the date of this prospectus), all dealers that effect transactions in these shares of common stock may be required to deliver a prospectus. This is in addition to the dealer's obligation to deliver a prospectus when acting as an underwriter and with respect to their unsold allotments or subscriptions. PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The securities are being registered for the account of selling shareholders. All of the following expenses will be borne by Valemont Supply Inc. The amounts set forth are estimates except for the SEC registration fee: SEC registration fee $10 Printing and engraving expenses 5,000 Attorneys' fees and expenses 4,000 Accountants' fees and expenses 2,000 Transfer agent's and registrar's fees and expenses 500 Miscellaneous 990 - ---------------------------------------------------------- Total $12,500 - ---------------------------------------------------------- ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Pursuant to Washington State law, a corporation may indemnify an individual made a party to a proceeding because the individual is or was a director against liability incurred in the proceeding if the individual acted in good faith; and he or she reasonably believed that, in the case of conduct in the individual's official capacity with the corporation, his or her conduct was in its best interests; in cases not involving his or her official capacity, his or her conduct was at least not opposed to its best interests; and in the case of any criminal proceeding, he or she had no reasonable cause to believe the conduct was unlawful. A corporation is prohibited from indemnifying a director in connection with a proceeding by or in the right of the corporation in which the director was adjudged liable to the corporation, in connection with any other proceeding charging improper personal benefit to the director, whether or not involving action in the director's official capacity, in which the director was adjudged liable on the basis that personal benefit was improperly received by the director. The articles of Valemont Supply Inc., filed as Exhibit 3.1, provide that Valemont Supply Inc. will indemnify its directors to the full extent permitted under Washington state law. The bylaws of Valemont Supply Inc., filed as Exhibit 3.2, provide that Valemont Supply Inc. will indemnify and hold harmless each person who was, is or is threatened to be made a party to or is otherwise involved in any threatened proceedings by reason of the fact that he or she is or was a Director or officer of the corporation or is or was serving at the request of the corporation as a Director, officer, partner, trustee, employee or agent of another entity, against all losses, claims, damages, liabilities and expenses actually and reasonably incurred or suffered in connection with such proceeding. ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES. Set forth below is information regarding the issuance and sales of Valemont Supply Inc.'s securities without registration since its formation. No such sales involved the use of an underwriter and no commissions were paid in connection with the sale of any securities. a. On June 25, 2001 Valemont Supply Inc. issued a total of 8,000,000 shares of common stock to A.E. Daem. The issuance of the common stock was exempt from registration under Regulation S. A.E. Daem was not a resident or citizen of the U.S. at the time it received the offer to purchase and at the closing of the purchase of the stock, and did not acquire the stock for the account or benefit of any U.S. person. A.E. Daem agreed to resell such securities only in accordance with the provisions of Regulation S, pursuant to registration, or pursuant to an available exemption from registration. The stock contains a legend to the effect that transfer is prohibited except in accordance with the provisions of Regulation S, pursuant to registration, or pursuant to an available exemption from registration. Valemont Supply Inc. will refuse to register any transfer of the Stock not made in accordance with the provisions of Regulation S, pursuant to registration, or pursuant to an available exemption from registration. The issuance of the shares was also exempt from registration under Rule 506 of Regulation D, and sections 3(b) and 4(2) of the Securities Act of 1933, as amended, due to Mr. Daem's status as the founder and initial management of Valemont Supply Inc., his status as an accredited investor and the limited number of investors (one). Item 16(a). Exhibits. Exhibit Number Name Page ---- 3.1* Articles of Incorporation 3.2* Bylaws 4.1* Specimen Share of Common Stock 5.1* Opinion re: Legality 10.1 Sale Agreement 10.2* Subscription Agreement and Investment Letter re: A.E. Daem 23.1 Consent of Independent Auditors. 23.2* Consent of Counsel (see Exhibit 5.1) *Previously filed ITEM 16(B). FINANCIAL STATEMENT SCHEDULES. As of October 31, 2001, Valemont Supply Inc.: - - has no valuation or qualifying accounts - - does not have a substantial portion of its business devoted to acquiring and holding for investment real estate or interests therein - - has no subsidiaries - - has no investments in mortgage loans on real estate. ITEM 17. UNDERTAKINGS. The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (a) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (b) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (c) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Kamloops, Province of British Columbia, Canada, on April 4, 2002. Valemont Supply Inc. /s/ A.E. Daem --------------- By A.E. Daem It's President Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated. /s/ A.E. Daem President, Secretary, Treasurer, and Director - --------------- A.E. Daem April 4, 2002 /s/ A.E. Daem Principal Accounting Officer - --------------- A.E. Daem April 4, 2002 EX-10.1 3 doc2.txt EXHIBIT 10.1 SALE AGREEMENT THIS AGREEMENT made as of this 26th day of June, 2001 BETWEEN: DOUGLAS MANLEY PAYNE, of 1709-89th Street, Dawson Creek, British Columbia, - ---------------------- Canada V1G 1A1 - ---- (hereinafter called "Payne" OF THE FIRST PART AND: VALEMONT SUPPLY LIMITED. 6779 Blackwell Rd, Kamloops, British Columbia, Canada V2C 6V7 (hereinafter called "VSI") OF THE SECOND PART WHEREAS: A. Payne owns the mineral claims, namely the Mica Mineral Claims, situated in the Cariboo Mining Division in the Province of British Columbia referred to herein as the "Mica Claims", the particular of which make up Appendix A. B. Payne has agreed to sell to VSI the Mica Claims for US$30.000 (Thirty Thousand) cash and a Royalty on other terms and conditions hereinafter set forth. NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of these presents and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: 1.0 DEFINITIONS 1.01 In this agreement and in all schedules attached to and made a part hereof, the following words and phrases shall have the following meanings, namely; (a) reference herein to the "Mica Claims" includes any mineral leases or other interests into which such mineral claims may have been converted; (b) "ROYALTY" means the grant by VSI to Payne as set forth in paragraph 4.01 hereof. 2.0 REPRESENTATION AND WARRANTIES OF DAEM 2.01 Payne represents and warrants to VSI that: (a) he is the registered and beneficial owner of each of the Mica Claims, and that the Mica Claims were properly and legally staked, recorded and tagged in compliance with laws of the Province of British Columbia, and there are no disputes over the title, the staking or the recording of the Mica Claims. (b) He is the holder of a valid Free Miner's Certificate issued pursuant to the laws of the Province of British Columbia and shall maintain such license in good standing for the remainder of 2001. Appendix B (c) The Mica Claims are in good standing with the Office of the Mining Recorder, having an expiry date as per Appendix A , and are free and clear of any claims, liens, charges or encumbrances of any nature and no adverse claim or challenge against the ownership of or title to the Mica Claims has been made nor to the knowledge of Payne is there any basis therefor and there are no outstanding agreements or options to acquire or purchase the Mica Claims or any part thereof. 2.02 Payne acknowledges that the representations and warranties set forth herein form part of this agreement and are the conditions upon which the VSI has relied in entering into this Agreement, and that these representations and warranties shall survive the sales agreement for the Mica Claims hereunder by VSI. 3.0 REPRESENTATIONS AND WARRANTIES OF VSI 3.01 VSI represents and warrants to Payne that: (a) it is a corporation duly organized, validly existing and in good standing under the laws of the State of Washington, United States Of America with full power, absolute authority and capacity to enter into this Agreement and to carry out the transactions contemplated hereby, all of which have been duly and validly authorized by all necessary corporate proceedings. 3.02 VSI acknowledges that the representations and warranties hereinbefore set out form a part of this Agreement and are conditions upon which Payne has relied in entering into this Agreement, and that these representations and warranties shall survive the sale of the Mica Claims hereunder to VSI 4.0 ROYALTY PAYMENTS 4.01 VSI hereby grants to Payne the sole and exclusive right to a Royalty on the Mica produced from the Mica Claims subject to the terms of this Agreement on the following terms and conditions, namely: (a) VSI shall pay $30,000.00 to Payne within seven days of the Acceptance Date of the sales agreement; (b) VSI shall pay or cause to be paid $2.00 US per ton of pit run of Mica containing ore extracted from the Mica Claims, this payment constitutes a net royalty payment to Payne. This payment is to be made within 30 days of the pit run Mica leaving the Mica Claims. (c) the price per ton will be negotiated at the end of the first five years and each five years thereafter. The price renewal will not exceed the United States of America inflation rate, nor be less than the preceding five year period. 5.0 TRANSFER OF CLAIMS 5.01 Upon execution of this Agreement, Payne shall deliver to the VSI a duly executed registrable BILL OF SALE ABSOLUTE. 5.02 VSI shall be entitled to at its own expense and under the terms and conditions of this Agreement have cause to direct the title of the claims to the holder of choice so long as it complies with all regulatory bodies in the involved jurisdictions in particular the Province of British Columbia and the B.C. Minerals Commission. 6.0 TERMINATION 6.01 if VSI for any reason including none payment of assessment to the B.C. Minerals Commission drops or should loose all or part of the Mica Claims (Appendix A) through any default whatsoever Payne shall have first right to obtain the MICA CLAIMS by any remedy necessary to make up the default. Notice of an intended default must be delivered on a timely bases so as to effect a cure prior to the claims going back to the Crown. 6.02 upon termination of this Agreement, VSI shall deliver to Payne such registerable transfers as are necessary to transfer to Payne all Mica Claims forming part of this Agreement. 7.0 OBLIGATIONS OF VSI 7.01 VSI hereby covenants and agrees; (a) it will permit Payne or a duly authorized agent, upon reasonable prior notice to VSI, to have access to Mica Claims in order to examine ore removed by or on behalf of VSI provided, however, that neither Payne nor his agents shall interfere or obstruct the operation of VSI , its servants and agents on the Mica Claims, and further provided that Payne or its agents shall enter upon the Mica Claims at their own risk and that Payne agrees to indemnify and save VSI harmless from all loss and damage of any nature or kind whatsoever in any way referable to the entry of, or presence on, or activities of either Payne or its agents while on the Mica Claims, including, without limiting the generality of the foregoing, bodily injuries or death at any time resulting therefrom and damage to property sustained by any person or persons; (b) to provide Payne with copies of all sales reports relating to the Mica Claims, at VSI's cost, forthwith upon any such reports being prepared. 8.0 OBLIGATION OF PAYNE 8.01 Payne hereby covenants and agrees that: (a) no use will be made of VSI or any company associated with VSI in any document or release made to Payne without the prior written approval of VSI; (b) any information acquired by Payne relating to the Mica Claim's with a direct bearing on the Sales Agreement shall be confidential and shall not be released or communicated to any person, firm or corporation without the prior written approval of VSI. (c) Payne will not deal, or attempt to deal the right and interest in the Mica Claims with regard to its royalty in any way that would or might affect the right of VSI. 9.0 DISPOSITION OF INTEREST BY PAYNE 9.01 If Payne should receive a bona fide offer from an independent third party ( the "proposed purchaser") dealing at arm's length with Payne to purchase all or substantially all of its Royalty interest in the Mica claims, which offer Payne desires to accept, or if Payne intends to sell all or substantially all of his Royalty interest in the Mica claims, Payne shall first offer (the offer) such interest in writing to VSI upon terms no less favorable than those offered by the proposed purchaser or intended to be offered by Payne, as the case may be. VSI has sixty (60) days accept the offer. If within a period of sixty days of the receipt of the offer VSI notifies Payne in writing that it will accept the same, Payne shall be bound to sell such interest to VSI on the terms and conditions of the offer. VSI shall in such case pay to Payne, against the receipt of an absolute transfer of clear and unencumbered title to the Royalty interest of Payne being sold. If VSI fails to notify Payne before the expiration of the time limited therefore that it will purchase the interest offered, Payne may sell and transfer such interest to the proposed purchaser at the price and on the terms and conditions specified in the offer. 10.0 NOTICE AND PAYMENT 10.01 Each notice, demand or the communication required or permitted to be given under this Agreement shall be in writing and shall be sent by prepaid registered mail deposited in a Post Office in Canada addressed the party entitled to received same, or delivered to such party, at the address for such party specified on the first page thereof. The date of receipt of such notice, demand or other communication shall be the date of delivery thereof if delivered, or, if given by registered mail as aforsaid, shall be deemed conclusively to be the third day after the same shall have been so mailed except in the case of interruption of the third day after the same shall have been so mailed except in the case of interruption of postal services for any reason whatsoever, in which case the date of receipt shall be the date upon which notice, demand or other communication is actually received by the addressee. 10.02 Any party may at any time and from time to time notify any other party in writing of a change of address and the new address to which notice shall be given to thereafter until further change. 10.03 Any payment that VSI may decide to make or cause to be made to Payne hereunder shall be deemed to have been well and truly made if a cheque payable to Payne in the appropriate amount has been delivered to the addressee hereof in accordance with the provisions of paragraph 10.01 hereof, the provisions of which shall apply, mutatis mutandis, as if such cheque was a notice given hereunder. 11.0 FURTHER ASSURANCE 11.01 Each of the parties hereto agrees to do and/or execute all such further and other acts, deeds, things, devices, documents and assurances as may be required in order to carry out the true intent and meaning of the Agreement. 12.0 ENTIRE AGREEMENT 12.01 The parties hereto agree that the terms and conditions of this Agreement shall supersede and replace any other agreements or arrangements, whether oral or written, heretofore existing between the parties in respect of the subject matter of this Agreement. 13.0 REGULATORY APPROVAL 13.01 This Agreement is subject to the approval of the securities regulatory authorities having or which will have jurisdiction over the affairs of VSI. 14.0 GOVERNING LAW 14.01 This Agreement shall be governed by and construed in accordance with the laws of the Province of British Columbia. 15.0 ENUREMENT 15.01 This Agreement shall enure to the benefit of and be binding upon the parties hereto and each of their heirs, executors, administrators, successors and assigns, as the case may be. WHEREOF IN WITNESS this Agreement has been executed as of the day and year first above written /s/ Douglas Payne - ------------------- DOUGLAS MANLEY PAYNE THE COMMON SEAL of VALMONT SUPPLY LIMITED was C/S Hereunto affixed in the Presence of: /s/ A.E. Daem - --------------- Authorized Signatory APPENDIX A MINERAL CLAIMS situated in the Cariboo area of the Province of British Columbia, Canada CLAIM RECORD NO. OF EXPIRY NAME NUMBER UNITS DATE - -------- ---------- -------- --------- Mica 1 364971 1 20010810 Mica 2 354972 1 20010810 Mica 3 364973 1 20010810 Mica 6 364976 1 20010808 Mica 7 364977 1 20020809 Mica 8 364978 1 20010809 T 1 342871 1 20011219 T 2 342872 1 20011219 T 3 342873 1 20011219 T 4 342874 1 20011219 T 5 342875 1 20011219 T 6 342876 1 20011219 Appendix B Province of British Columbia Ministry of Energy and Mines Mineral Tenure Act FREE MINER CERTIFICATE Not Transferable Free Miner No.: 131577 Client : DAEM. ANDY EDMUN 1387 MINTO CRES. VANCOUVER BC Canada V6H 2J6 Date of Issue: 2001/MAR/21 Valid From: 2001/JUN/01 Valid to: 2002/MAY/31 Issued at: Vancouver, British Columbia /s/ Scott Stewart (signature of issuing officer) EX-23.1 4 doc3.txt EXHIBIT 23.1 [GRAPHIC OMITED] [GRAPHIC OMITED] CONSENT OF INDEPENDENT AUDITOR We consent to the reference to our firm under the captions "Accountants On Accounting And Financial Disclosure" and "Interests Of Named Experts And Counsel" and to the use of our report dated September 21, 2001, in Amendment No. 2 to the Form S-1 Registration Statement and related Prospectus of Valemont Supply Inc. for the registration of shares of its common stock. /s/ Manning Elliot CHARTERED ACCOUNTANTS Vancouver, Canada April 2, 2002 -----END PRIVACY-ENHANCED MESSAGE-----