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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[ X ] Quarterly Report pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the quarterly period ended July 31, 1999
[ ] Transition Report pursuant to 13 or 15(d) of the
Securities Exchange Act of 1934
For the transition period May 1, 1999 to July 31, 1999
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Commission File Number 0-25553
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EXPLORE TECHNOLOGIES INC.
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(Exact name of small Business Issuer as specified in its charter)
Nevada 88-0419476
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
Suite 505 - 1155 Robson Street
Vancouver, British Columbia, Canada V6E 1B5
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number,including area code: 604-689-1659
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None
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period
that the issuer was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days
[ ] Yes [ X ] No
State the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
6,050,000 Shares of $.001 par value Class A Common Stock
outstanding as of July 31, 1999.
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PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying unaudited financial statements have been
prepared in accordance with the instructions to Form 10-QSB and
Item 310 (b) of Regulation S-B, and, therefore, do not include
all information and footnotes necessary for a complete
presentation of financial position, results of operations, cash
flows, and stockholders" equity in conformity with generally
accepted accounting principles. In the opinion of management,
all adjustments considered necessary for a fair presentation of
the results of operations and financial position have been
included and all such adjustments are of a normal recurring
nature. Operating results for the six months ended July 31,
1999 are not necessarily indicative of the results that can be
expected for the year ending January 31, 2000..
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EXPLORE TECHNOLOGIES, INC.
(An Exploration Stage Company)
FINANCIAL STATEMENTS
JULY 31, 1999
(Unaudited)
(Stated in U.S. Dollars)
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EXPLORE TECHNOLOGIES, INC.
(An Exploration Stage Company)
BALANCE SHEET
JULY 31, 1999
(Unaudited)
(Stated in U.S. Dollars)
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ASSETS
Current
Cash $ 33,507
Prepaid expense 750
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34,257
Mineral property (Note 4) 1,000
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$ 35,257
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LIABILITIES
Current
Accounts payable $ 3,544
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SHAREHOLDERS' EQUITY
Share Capital
Authorized:
25,000,000 Common shares,
par value $0.001 per share
Issued and outstanding:
6,050,000 Common shares 6,050
Additional paid in capital 58,950
Deficit Accumulated During The Exploration Stage (33,287)
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31,713
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$ 35,257
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EXPLORE TECHNOLOGIES, INC.
(An Exploration Stage Company)
STATEMENT OF LOSS AND DEFICIT
(Unaudited)
(Stated in U.S. Dollars)
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For The Inception
Six Months December 18,
Ended 1998
July 31 To July 31
1999 1999
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Expenses
Bank charges $ 184 $ 198
Office and sundry 334 488
Office facilities and services 4,500 5250
Professional fees 19,730 26,213
Property maintenance fees 1,138 1,138
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Net Loss For The Period (25,886) $ (33,287)
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Deficit Accumulated During The
Exploration Stage, Beginning Of Period (7,401)
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Deficit Accumulated During The
Exploration Stage, End Of Period $ (33,287)
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Net Loss Per Share ($0.01)
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Weighted Average Number of Shares
Outstanding 6,050,000
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EXPLORE TECHNOLOGIES, INC.
(An Exploration Stage Company)
STATEMENT OF CASH FLOWS
(Unaudited)
(Stated in U.S. Dollars)
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For The Inception
Six Months December 18,
Ended 1998
July 31 To July 31
1999 1999
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Cash Flow From Operating Activities
Net loss for the period $ (25,886) $ (33,287)
Adjustments To Reconcile Net Loss To
Net Cash Used By Operating Activities
Change in prepaid expense (750) (750)
Change in accounts payable (27) 3544
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(26,663) (30,493)
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Cash Flow From Investing Activities
Mineral property - (1,000)
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Cash Flow From Financing Activities
Share capital issued - 65,000
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Increase (Decrease) In Cash (26,663) 33,507
Cash, Beginning Of Period 60,170 -
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Cash, End Of Period $ 33,507 $ 33,507
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EXPLORE TECHNOLOGIES, INC.
(An Exploration Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
JULY 31, 1999
(Unaudited)
(Stated in U.S. Dollars)
Common Stock
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Additional
Paid-in
Shares Amount Capital Deficit Total
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Shares issued for cash
@ $0.01 6,000,000 $6,000 $ 54,000 $ - $60,000
Shares issued for
cash @ $0.10 50,000 50 4,950 - 5,000
Net loss for the
Period - - - (7,401) (7,401)
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Balance, January
31, 1999 6,050,000 6,050 58,950 (7,401) 57,599
Net loss for the
period - - - (25,886)(25,886)
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Balance, July 31,
1999 6,050,000 $6,050 $ 58,950 $(33,287)$31,713
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EXPLORE TECHNOLOGIES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 1999
(Unaudited)
(Stated in U.S. Dollars)
1. BASIS OF PRESENTATION
The unaudited financial statements as of July 31, 1999
included herein have been prepared without audit pursuant to
the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures
normally included in financial statements prepared in
accordance with United States generally accepted accounting
principles have been condensed or omitted pursuant to such
rules and regulations. In the opinion of management, all
adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been
included. It is suggested that these financial statements be
read in conjunction with the January 31, 1999 audited
financial statements and notes thereto.
2. NATURE OF OPERATIONS
a) Organization
The Company was incorporated in the State of Nevada, U.S.A.
on December 18, 1998.
b) Exploration Stage Activities
The Company is in the process of exploring its mineral
property and has not yet determined whether the property
contains ore reserves that are economically recoverable.
The recoverability of amounts shown as mineral property and
related deferred exploration expenditures is dependent upon
the discovery of economically recoverable reserves,
confirmation of the Company's interest in the underlying
mineral claims and the ability of the Company to obtain
profitable production or proceeds from the disposition
thereof.
3. SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Company have been prepared in
accordance with generally accepted accounting principles in
the United States. Because a precise determination of many
assets and liabilities is dependent upon future events, the
preparation of financial statements for a period necessarily
involves the use of estimates which have been made using
careful judgement.
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EXPLORE TECHNOLOGIES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 1999
(Unaudited)
(Stated in U.S. Dollars)
3. SIGNIFICANT ACCOUNTING POLICIES (Continued)
The financial statements have, in management's opinion, been
properly prepared within reasonable limits of materiality and
within the framework of the significant accounting policies
summarized below:
a) Mineral Property and Related Deferred Exploration
Expenditures
The Company defers all direct exploration expenditures on
mineral properties in which it has a continuing interest to
be amortized over the recoverable reserves when a property
reaches commercial production. On abandonment of any
property, applicable accumulated deferred exploration
expenditures will be written off. To date none of the
Company's properties have reached commercial production.
At least annually, the net deferred cost of each mineral
property is compared to management's estimation of the net
realizable value, and a write-down is recorded if the net
realizable value is less than the cumulative net deferred
costs.
b) Income Taxes
The Company has adopted Statement of Financial Accounting
Standards No. 109 - "Accounting for Income Taxes" (SFAS
109). This standard requires the use of an asset and
liability approach for financial accounting and reporting
on income taxes. If it is more likely than not that some
portion or all of a deferred tax asset will not be
realized, a valuation allowance is recognized.
c) Financial Instruments
The Company's financial instruments consist of cash and
accounts payable.
Unless otherwise noted, it is management's opinion that
this Company is not exposed to significant interest or
credit risks arising from these financial instruments. The
fair value of these financial instruments approximate their
carrying values, unless otherwise noted.
d) Net Loss Per Share
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EXPLORE TECHNOLOGIES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 1999
(Unaudited)
(Stated in U.S. Dollars)
Net loss per share is based on the weighted average number
of common shares outstanding during the period plus common
share equivalents, such as options, warrants and certain
convertible securities. This method requires primary
earnings per share to be computed as if the common share
equivalents were exercised at the beginning of the period
or at the date of issue and as if the funds obtained
thereby were used to purchase common shares of the Company
at its average market value during the period.
4. MINERAL PROPERTY
The Company has entered into an option agreement to acquire a
50% interest, subject to a 2.5% net smelter royalty, in the
Sand Springs, Nevada property for the following consideration:
- - cash payment of U.S. $1,000;
- - exploration expenditures totalling U.S. $150,000 by
December 31, 2001, U.S. $10,000 of which must be expended
by December 31, 1999.
Consideration paid to date $ 1,000
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5. UNCERTAINTY DUE TO THE YEAR 2000 ISSUE
The Year 2000 Issue arises because many computerized systems
use two digits rather than four to identify a year. Date-
sensitive systems may recognize the year 2000 as 1900 or some
other date, resulting in errors when information using year
2000 dates is processed. In addition, similar problems may
arise in some systems which use certain dates in 1999 to
represent something other than a date. The effects of the
Year 2000 Issue may be experienced before, on, or after
January 1, 2000, and, if not addressed, the impact on
operations and financial reporting may range from minor
errors to significant systems failure which could affect an
entity's ability to conduct normal business operations. It is
not possible to be certain that all aspects of the Year 2000
Issue affecting the entity, including those related to the
efforts of customers, suppliers, or other third parties, will
be fully resolved.
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Item 2. Management's Discussion and Analysis or Plan of
Operations
The Company is a natural resource company engaged in the
acquisition, exploration and development of mineral properties.
The Company has an interest in certain properties located in
Nevada, and intends to carry out exploration work on this
property in order to ascertain whether it possesses commercially
developable quantities of gold and other precious minerals.
The Company has raised sufficient funds from prior offerings of
its securities, as set forth in Item 4 of Part II of the
Company's Seconded Amended Form 10-SB Registration Statement, to
proceed with Phase One of its exploration program (also as
described therein). The Company will assess whether to proceed
with Phase Two of the exploration program (as described in the
First Amended Form 10-SB Registration Statement) upon completion
of Phase One and an evaluation of the results of the Phase One
program. During the month of August, 1999 Phase One of the
program commenced and was completed. Results of this program
will be released as soon as they become available. If the
Company determines to proceed with Phase Two, it will need
additional financing which it intends to obtain through a
private offering of stock to accredited investors under
Regulation D of the Securities Act of 1933. The Company thus
expects that it will be able to operate with its present cash
reserves through April, 2000 (assuming it does not go to Phase
Two before this time).
Since its inception on December 18, 1998, the Company has not
performed any research and development or expended any moneys in
this regard. Miranda Industries Inc., the vendor of the
property, has completed the geologist exploration program on the
Miranda Property, as discussed in the Company's filed Second
Amended Form 10-SB.
The Company has not purchased or sold any plant or significant
equipment and does not expect to do so in the foreseeable
future.
The Company currently has no employees, and does not expect to
hire any employees in the foreseeable future. The Company
conducts its business through agreements with consultants and
arms-length third parties.
CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR"
PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
From time to time, the "Company will make written and oral
forward-looking statements about matters that involve risk and
uncertainties that could cause actual results to differ
materially from projected results. Important factors that could
cause actual results to differ materially include, among others:
* Fluctuations in the market prices of gold
* General domestic and international economic and political
conditions
* Unexpected geological conditions or rock instability
conditions resulting in cave-ins, flooding, rock-bursts or
rock slides
* Difficulties associated with managing complex operations in
remote areas
* Unanticipated milling and other processing problems
* The speculative nature of mineral exploration
* Environmental risks
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* Changes in laws and government regulations, including those
relating to taxes and the environment
* The availability and timing of receipt of necessary
governmental permits and approval relating to operations,
expansion of operations, and financing of operations
* Fluctuations in interest rates and other adverse financial
market conditions
* Other unanticipated difficulties in obtaining necessary
financing
* The failure of equipment or processes to operate in
accordance with specifications or expectations
* Labor relations
* Accidents
* Unusual weather or operating conditions
* Force majeure events
* Other risk factors described from time to time in the
Company's filings with the Securities and Exchange
Commission.
Many of these factors are beyond the Company's ability to
control and predict. Investors are cautioned not to place undue
reliance on forward-looking statements. The Company disclaims
any intent or obligation to update its forward-looking
statements, whether as a result of receiving new information,
the occurrence of future events, or otherwise.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K.
(a) None
(b) Reports on Form 8-K--None
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SIGNAUTURES
In accordance with the requirements of the Securities and
Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned,
thereunto duly authorized.
EXPLORE TECHNOLOGIES INC.
Date: September 15, 1999
\s\ Peter Bell
By: -------------------------------
PETER BELL, Director, President
Chief Executive Officer
