U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
SEPTEMBER 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
______________ TO ______________
COMMISSION FILE NUMBER: 000-24723
Urbana.ca, Inc.
(Exact name of registrant as specified in its charter)
Nevada 88-0393257
(State or jurisdiction of incorporation I.R.S. Employer
or organization) Identification No.
750 West Pender Street, Suite 804, Vancouver, British Columbia V6C 2T8
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (604) 682-8445
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock,
$0.001 Par Value
Indicate by check mark whether the registrant (1) has 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 registrant was required to
file such reports), and (2) been subject to such filing
requirements for the past 90 days. Yes No X .
As of September 30, 1999, the registrant had 10,031,350
shares of common stock issued and outstanding.
Transitional Small Business Disclosure Format (check one):
Yes No X .
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION PAGE
ITEM 1. FINANCIAL STATEMENTS
BALANCE SHEETS AS OF SEPTEMBER 30, 1999
AND DECEMBER 31, 1998 3
STATEMENTS OF OPERATIONS FOR THE THREE
AND NINE MONTHS ENDEDd SEPTEMBER 30, 1999
AND SEPTEMBER 30, 1998 4
STATEMENTS OF CASH FLOWS FOR THE NINE
MONTHS ENDED SEPTEMBER 30, 1999 AND
SEPTEMBER 30, 1998 5
NOTES TO FINANCIAL STATEMENTS 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 11
PART II
ITEM 1. LEGAL PROCEEDINGS 14
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS 14
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 14
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 14
ITEM 5. OTHER INFORMATION 14
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 14
SIGNATURE 15
PART I.
ITEM 1. FINANCIAL STATEMENTS.
URBANA.CA, INC
(formerly Integrated Carbonics Corp.)
(A development stage company)
Balance Sheets (prepared by management and without audit)
30 Sep 99 31 Dec 98
_________ _________
Assets
Cash in hand and at Bank $ 60 $ 713
Prepaid expenses - 2,342
_________________________________________________________________________
Total Current Assets 60 3,055
_________________________________________________________________________
Capital Assets
Fixed Assets - -
Property, Plant and Equipment (Note 4) 3,031 4,784
Other Assets
Investment in graphite processing
joint venture (Note 7) 253,408 253,408
_________________________________________________________________________
256,439 258,192
_________________________________________________________________________
Total Assets 256,499 261,247
_________________________________________________________________________
Liabilities and Stockholder's Equity
Accounts Payable 160,578 156,360
Other Current Liabilities 34,144 -
Shareholder Loan 50,000 -
Current portion of long-term
debt (Note 7) 130,000 130,000
_________________________________________________________________________
Total Current Liabilities 374,722 286,360
_________________________________________________________________________
Long-term debt less current portion
(Note 7) - -
_________________________________________________________________________
Total Liabilities 374,722 286,360
_________________________________________________________________________
Stockholders' Equity (Deficit)
Common Stock (Note 9) 10,006 9,856
Additional paid-in capital 713,220 673,590
Deficit accumulated during the
development stage (841,449) (708,559)
_________________________________________________________________________
Total Stockholers' Equity (Deficit) (118,223) ( 25,113)
_________________________________________________________________________
Total Liabilities and Stockholders'
Equity (Deficit) $ 256,499 $ 261,247
_________________________________________________________________________
See accompanying Notes To The Financial Statements)
URBANA.CA, INC.
(formerly Integrated Carbonics Corp.)
(a development stage company)
STATEMENT OF OPERATIONS
For the 9-month period ended September 30, 1999 (prepared by
management and without audit
_________________________________________________________________________
February 23,
1993
Nine Months Ended Three Months Ended (inception to
30-Sep-99 30-Sep-98 30-Sep-99 30-Sep-98 30-Sep-99
_________ _________ _________ _________ _____________
Operating Expenses
Amortization $ 1,753 $ 3,071 $ 584 $ 1,024 $ 6,139
Engineering
Costs - - - - 274,170
General and
Adm expenses 97,832 198,993 (110,907) 32,843 314,323
Interest and
bank charges 266 3,467 133 1,159 9,902
Legal and
accounting 6,141 - 2,890 - 63,746
Transfer agent
and filing fees 10,350 3,816 3,046 3,446 23,300
Rent 16,548 26,299 5,023 7,867 51,165
Salaries and
wages - 81,856 - 12,677 83,704
Write-off of
interest in
mineral property - - - - 15,000
_________________________________________________________________________
132,890 317,502 (99,231) 59,016 841,449
_________________________________________________________________________
NET LOSS $(132,890) $(317,502) $ 99,231 $(59,016) $(841,449)
__________________________________________________________________________
NET LOSS PER
SHARE-BASIC $ (0.01) $ (0.03) $ 0.01 $ (0.01) $ -
__________________________________________________________________________
WEIGHTED AVERAGE
NUMBER OF SHARES
OF COMMON STOCK
OUTSTANDING 10,229,683 10,126,350 9,465,900 9,843,016 -
__________________________________________________________________________
(See accompanying Notes to Financial Statements)
URBANA.CA, INC.
(formerly Integrated Carbonics Corp.)
(a development stage company)
STATEMENT OF CASH FLOWS
For the 9-month period ended September 30, 1999
(Prepared by management and without audit
__________________________________________________________________________
February 23
1993
Nine Months Ended Three Months Ended (inception to
30-Sep-99 30-Sep-98 30-Sep-99 30-Sep-98 30-Sep-99
_________ _________ _________ _________ ____________
Operating
Activities
Net loss $(132,890) $(317,502) $ 99,231 $ (59,016) $ (841,449)
Add (less)
Amortization 1,753 3,071 584 1,024 6,139
Imputed interest
on long-term debt 9,000
Organization cost (308)
Write-off interest
in mineral property 15,000
Write-off other
asset 4,500
Loss on disposal
of property, plant
and equipment 1,589
Net changes in
working capital 90,704 77,915 33,907 (13,333) 225,627
__________________________________________________________________________
(40,433) (236,516) 133,722 (71,325) (579,902)
___________________________________________________________________________
FINANCIAL
ACTIVITIES
Repayment of
long-term debt - (70,000) - - (70,000)
Issuance of
common stock 39,780 605,446 (133,722) 13,200 665,376
Suscription
received - (37,000) - (5,250) 37,000
__________________________________________________________________________
39,780 498,446 (133,722) 7,950 632,376
__________________________________________________________________________
INVESTMENT
ACTIVITIES
Purchase of
property, plant
and equipment - (11,423) (11,423)
Proceeds on
disposal of
property, plant
and equipment 972
Investment in a
graphite
processing joint
venture (2,420) (37,463)
Engineering costs
Phase 1 - (265,640) (9,645) (4,500)
___________________________________________________________________________
- (279,483) - (9,645) (52,414)
___________________________________________________________________________
NET CASH INFLOW (653) (17,553) - (73,020) 60
CASH, BEGINNING
OF PERIOD 713 44,576 60 100,043 -
__________________________________________________________________________
CASH, END OF
PERIOD $ 60 $ 27,023 $ 60 $ 27,023 60
__________________________________________________________________________
(See accompanying Notes To The Financial Statements)
URBANA.CA, INC.
(formerly Integrated Carbonics Corp.)
(a development stage company)
Notes to Financial Statements (Unaudited)
For the Nine Months Ended September 30, 1999
1. DESCRIPTION OF BUSINESS
The Company was organized on February 23, 1993 under the
laws of the State of Delaware as PLR, Inc. On October 3, 1997,
it changed its name to Integrated Carbonics Corp. and on
October 30, 1997, changed its jurisdiction of incorporation to
Nevada. On July 23, 1999 the Company changed its name to
Urbana.ca, Inc. On April 15, 1999 a wholly owned subsidiary
company, 583574 B.C Ltd. was incorporated under the laws of
British Columbia in Canada as a means of entering into
acquisitions in Canada. On May 4, 1999 the subsidiary company's
name was changed to ICC Integrated Carbonics (Canada) Corp.
The Company has signed joint venture agreements for the construction and
operation of two graphite processing plants in the People's Republic of China.
2. CONTINUING OPERATIONS
The financial statements have been prepared on the basis of
accounting principles applicable to a going concern which
contemplates the realization of assets and satisfaction of
liabilities in the normal course of business. The Company is a
development stage enterprise and as such has no significant
revenue and is incurring substantial costs in connection with its
investment in a graphite processing joint venture as described in
Note 5. In addition the Company incurred a loss of $132,890 for
the nine months ended September 30, 1999 and has a working
capital deficiency of $374,662 at September 30, 1999. The
Company's continued existence is dependent on its ability to
obtain additional financing to proceed with the joint venture and
ultimately to attain profitable operations.
If the going concern assumption is not appropriate in the
preparation of these financial statements, adjustments would be
necessary to the carrying values of assets and liabilities, the
reported loss and the balance sheet classifications used.
3. SIGNIFICANT ACCOUNTING POLICIES
The financial statements are expressed in U.S. dollars, have
been prepared in accordance with accounting principles generally
accepted in the United States, and include the following
significant accounting policies:
(a) Investment in joint ventures.
The Company records its investment in joint ventures at cost
until such date as the venturers make their initial capital
contribution at which time they are recorded on the equity basis.
(b) Interest in mineral property.
The Company follows the method of accounting for its interest in
mineral property whereby initial costs related to the acquisition
of mineral properties are capitalized by property. Exploration
and development costs are expensed as incurred.
The interest in mineral property will be written down on a
property by property basis when a significant decline in value
that is other than temporary has occurred and will be written off
when a property is abandoned.
(c) Property, plant and equipment.
Property, plant and equipment are recorded at cost. Depreciation
is charged to operations over the estimated useful lives of the
assets as follows:
Computer software straight line over 12 months
Computer hardware straight line over 24 months
Furniture and office equipment straight line over 60 months
The carrying value of property, plant and equipment is reviewed
on a regular basis for any permanent impairment in value. Where
such impairment is indicated, property, plant and equipment are
written down to estimated net realizable value.
(d) Accounting estimates.
Preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires
management to make estimates and assumptions that affect the
reported amounts of assets, liabilities, the disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses
during the period. Actual results could differ from those
estimates.
(e) Net loss per share.
Net loss per share is computed using the weighted average number
of common shares outstanding during the period. Diluted loss per
share has not been disclosed as the effect of common shares
issuable upon the exercise of options or warrants would be anti-
dilutive.
In February 1997, the Financial Accounting Standards Board
("FASB") issued Statement of Financial Accounting Standards
No. 128 ("SFAS 128"), "Earnings per Share". SFAS 128 is effective
for the fiscal year ending after December 15, 1997. SFAS 128
redefines earnings per share under U.S. GAAP and replaces primary
earnings per share with basic earnings per share and fully
diluted earnings per share with diluted earnings per share. Net
loss per share, as reported, is equal to the net loss per share
based on SFAS 128 for all periods presented.
(f) Recent accounting policies.
In June 1998, the FASB issued Statement No. 133 ("SFAS 133"),
"Accounting for Derivative Instruments and Hedging Activities".
SFAS 133 establishes standards for accounting for derivative
instruments. SFAS 133 is effective for fiscal years beginning
after June 15, 1999. The Company does not expect that adoption
of SFAS 133 will have a material effect on the Company's
financial statements.
4. PROPERTY, PLANT AND EQUIPMENT
Sept 30, Dec. 31,
1999 1998
Computer $ 1,692 $ 1,692
software
Computer 1,520 1,520
hardware
Furniture and office equipment 5,011 5,011
_______________________________________________________________________
8,223 8,223
Less: accumulated depreciation (5,192) (3,439)
_______________________________________________________________________
$ 3,031 $ 4,784
_______________________________________________________________________
5. INVESTMENTS IN GRAPHITE PROCESSING JOINT VENTURES
(a) Liumao.
On October 7, 1997, the Company entered into an agreement with
Da-Jung Resource Corp., a company controlled by certain directors
of the Company, to acquire 100% of its rights and obligations
pursuant to an "Agreement on Establishment of a Sino Foreign
Equity Joint Venture" with Jixi Liumao Graphite Mine, of
Heilongjiang Province, the People's Republic of China.
Consideration for this agreement was 6,000,000 shares of the
Company's post split common stock, plus $70,000 on the completion
of the offering which has been paid, $50,000 on the exercise of
all related warrants and $80,000 one year from the date of the
offering or upon completion of additional financing, whichever
comes first. In connection with the agreement, $130,000 is due
on December 31, 1999.
On November 10, 1997, the Company entered into a formal
agreement with the Liumao Graphite Mine to form a joint venture
company named ICC Liumao Graphite Products, Ltd. The purpose of
the joint venture company is to establish value added graphite
processing facilities at the Liumao Mine in China to produce high
purity graphite, expandable graphite, graphite sheet or other
graphite products.
The total investment of the Company in the joint venture
company is stipulated as 80% of anticipated joint venture
construction costs of $28 million, and the Company will obtain an
80% share of the profits over a thirty year period. Further
investment in the joint venture by the Company is contingent on
the completion of additional financing arrangements with
shareholders or third parties. The joint venture company has
received regulatory approval.
The investment in the graphite processing joint venture is
valued at the cost to acquire the rights to enter into the joint
venture plus legal and other costs incurred by the Company to
negotiate the formal joint venture agreement. No capital
investment in the joint venture has been made to date.
(b) YiChang.
On September 21, 1998, the Company entered into an interim
agreement with YiChang Heng Da Graphite Group Company Ltd.
("YiChang") to obtain a 55% interest in a joint venture between
YiChang and the Company. Under this joint venture agreement,
YiChang will sell, at net book value, to the joint venture one of
its operating divisions consisting of a new mine and mineral
processing plant and a graphite sheet manufacturing plant. The
Company will contribute RMB 28.6 million ($3.84 million)
according to a contribution schedule to be negotiated. The joint
venture will then proceed to construct additional graphite sheet
manufacturing capacity and, at its option, construct a
fluorographite and lithium ion battery manufacturing facility.
As of September 30, 1999, no costs have been incurred. The Joint
Venture Agreement was formally executed in April 1999.
6. INTEREST IN MINERAL PROPERTY
On September 22, 1997, the Company entered into an agreement
with Da-Jung Resource Corp., a company controlled by certain
directors of the Company, to acquire 100% of its interest in the
Yue-jinshan-Zianfengbei mineral property, in the Wandashan
mineralization zone of Heilongjiang Province, People's Republic
of China, in exchange for 150,000 shares of the Company's common
stock valued at $0.10 per share. During 1998, the interest in
mineral property was written off.
7. LONG-TERM DEBT
Sept.30 Dec. 31,
1999 1998
________ ________
Amount payable to Da-Jung Resource Corp. on
acquisition of its interest in the graphite
processing joint venture (Note 5(a)) $ 130,000 $ 130,000
Current portion (130,000) (130,000)
______________________________________________________________________
$ - $ -
_______________________________________________________________________
The long-term debt is unsecured and non-interest bearing and
as a result was recorded on a present-value basis to December 31,
1998 with imputed interest recognized at 8%. During the period,
the repayment terms were extended to December 31, 1999.
8. SHARE CAPITAL
The company has given retroactive effect and restated share
numbers to give effect to the following capital transactions:
(a) On March 15, 1996, at a meeting of the Board of
Directors, the Board approved amending its Articles of
Incorporation. These amendments were approved by a majority vote
of the shareholders. The Company authorized changing its
authorized common stock of 15,000 shares with $5.00 par value, to
50,000,000 common shares with par value $.001 and 10,000,000
preferred shares with a par value $.001. The Company also
approved a forward stock split on the basis of 3,500:1,
increasing the number of outstanding shares from 600 shares to
2,100,000 shares.
(b) On January 17, 1997, at a special meeting of the
shareholders, the shareholders approved, effective January 4,
1997, a forward stock split of 5:1, increasing the number of
common shares outstanding from 2,100,000 common shares to
10,500,000 common shares outstanding.
(c) On October 31, 1997, at a special meeting of the
shareholders, the shareholders approved a reverse stock split of
1:100 thus reducing the number of common shares outstanding from
25,500,000 shares to 255,000 shares of common stock.
On October 31, 1997, at a special meeting of the shareholders, the
shareholders authorized a Regulation D Rule 504 offering of a maximum of
2,300,000 units at $.10 per unit consisting of one common share and one
warrant exercisable at $.33 per share for six months.
(d) In January 1999, the Company entered into a one-year
corporate finance advisory agreement, cancellable at any time on
30 days' written notice, with a third party and agreed to issue,
as partial consideration, 350,000 common shares at predetermined
dates over the course of the contract. The common shares are
subject to registration and, to March 31, 1999, 150,000 common
shares have been delivered at a deemed value of $39,780. The
finance agreement was subsequently cancelled such that no future
shares are required to be delivered in respect of this agreement.
Also in January 1999, the Company entered into a marketing
agreement with another third party and issued, as partial
consideration, 360,000 common shares, at a deemed value of
$133,722 which are subject to registration. The parties
subsequently agreed to terminate the marketing agreement and in
August 1999 cancelled the 360,000 common shares previously issued.
As at September 30, 1999 25,000 shares were held in escrow.
9. STOCK OPTIONS
During the period the Company adopted a new Stock Option
Plan and cancelled all previously granted stock options. The
newly adopted Stock Option Plan will provide options to purchase
up to 2,000,000 common shares of the Company for its employees,
officers and directors. The options that will be granted
pursuant to the Stock Option Plan are exercisable at a price of
$0.50 which is equal to the fair value of the common shares at
the time of adoption.
10. RELATED PARTY TRANSACTIONS
(a) As of September 30 1999, liabilities include $11,216
(1998 - $10,529) due to companies controlled by certain directors
of the Company. The amounts are unsecured, interest-free, and do
not have fixed repayment terms.
(b) The Company entered into the following transactions
with companies controlled by certain directors of the Company:
Nine Months Ended September 30 1999 1998
____ _____
Rent $ 14,923 $ 19,993
Office expenses and travel 597 5,546
Miscellaneous expense 2,796
Management fees 24,178
Consultancy fee 9,668
The Company has entered into an agreement to lease premises from
a company controlled by certain directors as described in Note 11.
11. COMMITMENTS
On December 8, 1997, the Company entered into a one-year lease
commitment effective January 1, 1998 for $6,600 plus applicable
operating costs. During 1998, this lease was extended to December 31, 1999.
12. SUBSEQUENT EVENTS
During the period the Company entered into an agreement to
acquire, through its wholly owned Canadian subsidiary, ICC
Integrated Carbonics (Canada) Corp., the entire equity interest
of HomeNet100.com Enterprises, Inc.("HomeNet"). Completion of
the acquisition is subject to finalizing a formal agreement with HomeNet.
13. PRIOR YEARS' AMOUNT
Certain of prior years' amounts have been reclassified where
applicable, to conform with the current year's presentation.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
The following discussion should be read in conjunction with the
financial statements of the Company and notes thereto contained
elsewhere in this report.
Results of Operations.
During the three month period ended September 30, 1999, the
Company continued with its program to develop itself (formerly
Integrated Carbonics Corp.) into an operating company. For the
nine months ended September 30, 1999, the Company had a net loss
of $132,890 or 1 cent per share. This loss compares with a loss
of $317,502 or 3 cents per share for the corresponding nine month
period last year.
During the three months ended September 30, 1999, the Company
continued to seek financing for its joint ventures in China. In
this regard, the Company engaged consultants to assist the
Company concerning structuring development plans, financing
strategies, shareholder communications, and creating awareness
with the brokerage community by electronic means. While
continuing with efforts to obtain financing for the Company's
China graphite projects, management implemented a diversification
strategy late in the first quarter, in an attempt to reduce the
risk of being unable to make progress in that financing effort.
During this period, the Company entered into a letter of intent
to acquire the entire equity interest of HomeNet100.com
Enterprises, Inc. ("HomeNet") through its wholly owned Canadian
subsidiary, ICC Integrated Carbonics (Canada) Corp. which had
been incorporated for that purpose. HomeNet is an e-commerce
company established to tap the rapidly growing market for home
furnishings and accessories with an e-commerce only brand and
business model. The acquisition received approval from both the
Company and HomeNet shareholders.
During the three months ended September 30, 1999, the Company
cancelled all outstanding stock options previously granted to
directors, officers, and employees of the Company and has
cancelled its 1998 revised stock option plan. A new stock option
plan received shareholders' approval and was adopted during the period.
During this period, the Company cancelled the corporate finance
advisory agreement originally executed in January 1999 along with
shares that had been issued in respect of this agreement for
consulting services. In addition the Company cancelled a
marketing agreement with a third party also executed in January 1999.
Liquidity and Capital Resources.
During the three month period ended September 30, 1999, the
Company continued its status as a development company. The
Company is continuing to incur development expenses, is deriving
no revenues, and has experienced an ongoing deficiency in working
capital. The Company's continued existence is dependent on its
ability to obtain additional financing to proceed with investment
in its joint ventures and ultimately to attain profitable operations
from its joint ventures and the newly acquired e-commerce venture.
At September 30, 1999 the Company had a working capital deficiency of
$374,662. This compares with a working capital deficiency of $283,305
at December 31, 1998.
The Company continues efforts to arrange suitable financing for
its China projects but reports that to date no commitments have
been made. The Company is also continuing with the requirements
to complete its aquistion of HomeNet. Only essential
administrative expenses are being incurred.
Capital Expenditures.
No material capital expenditures were made during the quarter
ended on September 30, 1999.
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 the year
2000 date 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 system failure which
could affect the Company's ability to conduct normal business
operations. This creates potential risk for all companies, even
if their own computer systems are Year 2000 compliant. It is not
possible to be certain that all aspects of the Year 2000 issue
affecting the Company, including those related to the efforts of
customers, suppliers, or other third parties, will be fully
resolved.
The Company currently believes that its systems are Year 2000
compliant in all material respects. Although management is not
aware of any material operational issues or costs associated with
preparing its internal systems for the Year 2000, the Company may
experience serious unanticipated negative consequences or
material costs caused by undetected errors or defects in the
technology used in its internal systems. The Company's Year 2000
plans are based on management's best estimates.
Forward Looking Statements.
The foregoing Management's Discussion and Analysis contains
"forward looking statements" within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Act of 1934, as amended, and as contemplated under the
Private Securities Litigation Reform Act of 1995, including
statements regarding, among other items, the Company's business
strategies, continued growth in the Company's markets,
projections, and anticipated trends in the Company's business and
the industry in which it operates. The words "believe,"
"expect," "anticipate," "intends," "forecast," "project," and
similar expressions identify forward-looking statements. These
forward-looking statements are based largely on the Company's
expectations and are subject to a number of risks and
uncertainties, certain of which are beyond the Company's control.
The Company cautions that these statements are further qualified
by important factors that could cause actual results to differ
materially from those in the forward looking statements,
including, among others, the following: reduced or lack of
increase in demand for the Company's products, competitive
pricing pressures, changes in the market price of ingredients
used in the Company's products and the level of expenses incurred
in the Company's operations. In light of these risks and
uncertainties, there can be no assurance that the forward-looking
information contained herein will in fact transpire or prove to
be accurate. The Company disclaims any intent or obligation to
update "forward looking statements".
PART II.
ITEM 1. LEGAL PROCEEDINGS.
The Company is not a party to any material pending legal
proceedings and, to the best of its knowledge, no such action by
or against the Company has been threatened.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHBITS AND REPORTS ON FORM 8-K.
(a) Reports on Form 8-K. No reports on Form 8-K were filed
during the third quarter of the fiscal year covered by this Form
10-QSB.
(b) Exhibits included or incorporated by reference herein: See
Exhibit Index.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Urbana.ca, Inc.
Dated: November 12, 1999 By: /s/ Jason Cassis
Jason Cassis, President
EXHIBIT INDEX
Exhibit No. Description
___________ ___________
2 Articles of Merger of Foreign Corporation into Integrated
Carbonics Corp. (incorporated by reference to Exhibit 2 to
the Registration Statement on Form 10-SB/A filed on
December 17, 1998.
3.1 Articles of Incorporation of Integrated Carbonics Corp.
(incorporated by reference to Exhibit 3.1 of the Registration
Statement on Form 10-SB/A filed on December 17, 1998.
3.2 Certificate of Amendment to Articles of Incorporation of
Integrated Carbonics Corp. (see below).
3.3 Bylaws of Integrated Carbonics Corp. (incorporated by
reference to Exhibit 3.2 of the Registration Statement on
Form 10-SB/A filed on December 17, 1999.
4 Integrated Carbonics Corp. 1999 Stock Option Plan (see
below).
10.1 September 22, 1997 Agreement between Da-Jung Resource Corp.
and PLR, Inc. (incorporated by reference to Exhibit 10.1 of
the Registration Statement on Form 10-SB/A filed on December
17, 1998).
10.2 October 7, 1997 Agreement between Da-Jung Resource Corp. and
Integrated Carbonics Corp. (incorporated by reference to
Exhibit 10.2 of the Registration Statement on Form 10-SB/A
filed on December 17, 1998).
10.3 September 9, 1997 Agreement on Establishment of Sino Equity
Joint Venture, China-Canada Liumao Graphite Products Co. Ltd.
(incorporated by reference to Exhibit 10.3 of the Registration
Statement on Form 10-SB/A filed on December 17, 1998).
EXHIBIT INDEX
Exhibit No. Description
___________ ___________
10.4 November 10, 1997 Equity Joint Venture Liumao Graphite Mine
and Integrated Carbonics Corp. (incorporated by reference to
Exhibit 10.4 of the Registration Statement on Form 10-SB/A
filed on December 17, 1998).
10.5 August, 1997 Cooperative Joint Venture Agreement between
Heilongjiang Geological and Mining Technology Development Corp.
and Da-Jung Resource Corp. (incorporated by reference to
Exhibit 10.5 of the Registration Statement on Form 10-SB/A
filed on December 17, 1998).
27 Financial Data Schedule (see below).
CERTIFICATE OF AMENDMENT TO ARTICLES OF INCORPORATION
OF
INTREGRATED CARBONICS CORP.
Mario Aiellot, President of INTEGRATED CARBONICS CORP. (the "Corporation")
certifies that:
1. The original articles were filed with the Office of the Secretary of
State on October 10, 1997.
2. As of the date of this certificate shares of stock of the
corporation have been issued.
3. Pursuant to a shareholders meeting at which in excess of 51%
voted in favor of the following amendment, the company hereby
adopts the following amendments to the Articles of Incorporation
of this Corporation:
Article I: The Name of the Corporation:
The Name of the Corporation will be URBANA.CA, INC.
/s/ Mario Aiello
Mario Aiello, President
/s/ Robert S. Tyson
Robert S. Tyson, Secretary
Province of British Columbia
Country of Canada
On July 16, 1999, Mario Aiello personally appeared before me, a
Notary public, who acknowledged that he executed the above instrument.
/s/
A Notary Public in the Province of
British Columbia, Canada
Province of British Columbia
Country of Canada
On July 16, 1999, Robert S. Tyson personally appeared before me,
a Notary public, who acknowledged that he executed the above
instrument.
/s/
A Notary Public in the Province of
British Columbia, Canada
INTEGRATED CARBONICS CORP.
(the "Corporation")
1999 STOCK OPTION PLAN
1. Purpose of the Plan
The purpose of the plan is to provide certain directors, officers
and key employees of, and certain other persons or business
entities who provide services to, the Corporation and its
Subsidiaries with an opportunity to purchase Common Shares and to
benefit from any appreciation in the value thereof. This will
provide an increased incentive for these individuals or business
entities to contribute to the future success and prosperity of
the Corporation, thus enhancing the value of the Common Shares
for the benefit of all the shareholders and increasing the
ability of the Corporation and its Subsidiaries to attract and
retain skilled and motivated individuals in the service of the
Corporation.
2. Defined Terms
Where used herein, the following terms shall have the following
meanings, respectively:
(a) "Board" means the board of directors of the Corporation;
(b) "Common Shares" means the common shares of the Corporation or, in
the event of an adjustment contemplated by Article 6 hereof, such
other Common Shares to which a Participant may be entitled upon
the exercise of an Option as a result of such adjustment;
(c) "Corporation" means Integrated Carbonics Corp. and includes any
successor corporation thereof;
(d) "Exchange" means OTC Bulletin Board or, if the Common Shares are
not then listed and posted for trading on the OTC Bulletin Board,
on such stock exchange on which such shares are listed and posted
for trading as may be selected for such purpose by the Board;
(e) "Market Price" per Common Share at any date shall be $0.50 per share;
(f) "Option" means an option to purchase Common Shares granted by the
Board to Participants, subject to the provisions contained herein;
(g) "Option Price" means the price per share at which Common Shares
may be purchased under the Option, as the same may be adjusted in
accordance with Articles 4 and 6 hereof;
(h) "Participants" means certain directors, officers and key
employees of, and certain other persons or business entities who
provide services to, the Corporation to whom Options are granted
and which Options or a portion thereof remain unexercised;
(i) "Plan" means the 1999 Stock Option Plan of the Corporation, as
the same may be amended or varied from time to time; and
(j) "Subsidiary" means any corporation which is controlled by the
Corporation.
3. Administration of the Plan
3.1 The Plan shall be administered by the Board. The Corporation
shall effect the grant of Options under the Plan, in accordance
with determinations made by the Board, pursuant to the provisions
of the Plan, as to those individuals or business entities
eligible to be Participants and the number of Common Shares which
shall be the subject of each Option, by the execution and
delivery of a stock option agreement in such form which is
consistent with the provisions of the Plan as may be approved by
the Board.
3.2 The Board may, from time to time, adopt such rules and
regulations for administering the Plan as it may deem proper and
in the best interest of the Corporation and may, subject to the
applicable law, delegate its powers hereunder to administer the
Plan to a committee of the Board.
4. Granting of Options
4.1 The Board from time to time may grant Options to certain
individuals or business entities eligible to be Participants.
The grant of Options will be subject to the conditions contained
herein and may be subject to additional conditions determined by
the Board from time to time.
4.2 The aggregate number of Common Shares reserved for issuance under
the Plan must not exceed 10% of the issued and outstanding Common
Shares of the Company (on a non-diluted basis). The aggregate
number of Common Shares reserved for issuance to any one person
or business entity under the Plan must not exceed 2% of the
issued and outstanding Common Shares of the Company (on a non-
diluted basis). The Common Shares in respect of which Options
are not exercised shall be available for subsequent options. No
fractional shares may be purchased or issued hereunder.
4.3 The Option Price shall be calculated by the Board and shall be a
minimum of the Market Price less a discount as deemed appropriated by
the Board of Directors subject always to regulatory requirements.
4.4 An Option must be exercised within a period of one year from the
date of the granting of the Option. The limitation period or periods
within this one year period during which an Option or a portion thereof may
be exercised by a Participant shall be determined by the Board.
5. Exercise of Option
Subject to the provisions of the Plan and the terms of the
granting of the Option, an Option or a portion thereof may be
exercised from time to time by delivery to the Corporation at its
head office of a notice in writing signed by the Participant or
the Participant's legal personal representative and addressed to
the Corporation. This notice shall state the intention of the
Participant or the Participant's legal representative to
exercise the said Option or a portion thereof, the number of
Common Shares in respect of which the Option is then being
exercised, and must be accompanied by payment in full of the
Option Price for the Common Shares which are the subject of the
exercise.
6. Adjustment in Shares
6.1 Appropriate adjustments in the number of Common Shares subject to
the Plan and, as regards Options granted or to be granted, in the
number of Common Shares optioned and in the Option Price, shall
be made by the Board to give effect to adjustments in the number
of Common Shares resulting from subdivisions, consolidations or
reclassification of the Common Shares or other relevant changes
in the authorized or issued capital of the Corporation.
6.2 Options granted to Participants hereunder are non-assignable and,
except in the case of the death of a Participant who is an
individual (which is provided for in Section 8), are exercisable
only by the Participant to whom the Options have been granted;
provided that subject to the prior approval of the Board an
Option may be assigned to a corporation controlled by the
Participant and 100% beneficially owned by the Participant and
his spouse or children, which control and ownership shall
continue for as long as any part of the Option remains
unexercised.
7. Decisions of the Board
All decisions and interpretations of the Board respecting the
Plan or Options granted thereunder shall be conclusive and
binding on the Corporation and the Participants and their
respective legal representative and on all directors, officers,
employees and other persons or business entities eligible under
the provisions of the Plan to participate therein.
8. Termination of Employment/Death
8.1 If a Participant ceases to be a director, officer, employee,
person or business entity providing services to the Corporation
(other than death), with written approval of the Board of
Directors, he may within 30 days following his ceasing to be a
director, officer, employee, person or business entity providing
services to the Corporation, exercise his Option to the extent
that he was entitled to exercise it at the date of such cessation.
8.2 In the event of the death of a Participant who is an individual,
the Option previously granted to him shall be exercisable only
within twelve months following such death and then only:
(a) by the person or persons to whom the Participant's rights under
the Option shall pass by the Participant's will or the laws of
descent and distribution; and;
(b) if and to the extent that he was entitled to exercise the Option
at the date of his death.
8.3 The Plan does not confer upon a Participant any right with
respect to continuation of employment or retention of services by
the Corporation or any Subsidiary, nor does it interfere in any
way with the right of the Participant or the Corporation to
terminate the Participant's employment or retention at any time.
8.4 Options shall not be affected by any change of employment or
retention of the Participant where the Participant continues to
be employed or retained by the Corporation or any of its
subsidiaries.
9. Effect of Takeover Bid
9.1 If a bona fide offer (the "Offer") for Common Shares is made to
the Participant or to shareholders generally or to a class of
shareholders which includes the Participant, which Offer, if
accepted in whole or in part, would result in the offeror
exercising control over the Corporation, then the Corporation
shall, immediately upon receipt of notice of the Offer, notify
each Participant currently holding an Option of the Offer, with
full particulars thereof; whereupon, such Option may be exercised
in whole or in part by the Participant so as to permit the
Participant to tender the Common Shares received upon such
exercise (the "Option Shares") pursuant to the Offer. If:
(a) the Offer is not completed within the time specified therein; or
(b) the Participant does not tender the Optioned Shares pursuant to
the Offer; or
(c) all of the Optioned Shares tendered by the Participant pursuant
to the Offer are not taken up and paid for by the offeror in respect thereof;
then the Optioned Shares or, in the case of clause (c) above, the
Optioned Shares that are not taken up and paid for shall be
returned by the Participant to the Corporation and reinstated as
authorized but unissued Common Shares and the terms of the Option
as set forth in the Plan shall again apply to the Option. If any
Optioned Shares are returned to the Corporation under this Section, the
Corporation shall refund the exercise price to the Optioned for such
Optioned Shares. In no event shall the Participant be entitled to sell
the Optioned Shares otherwise than pursuant to the Offer.
10. Effect of Amalgamation, Consolidation or Merger
10.1 If the Corporation amalgamates, consolidates with or merges with
or into another corporation any Common Shares receivable on the
exercise of an Option shall be converted into the securities,
property or cash which the Participant would have received upon
such amalgamation, consolidation or merger if the Participant had
exercised his Option immediately prior to the record date
applicable to such amalgamation, consolidation or merger, and the
Option Price shall be adjusted appropriately by the Board and
such adjustment shall be binding for all purposes of the Plan.
11. Amendment or Discontinuance of Plan
11.1 The Board may amend or discontinue the Plan at any time without
the consent of the Participants provided that such amendment
shall not alter or impair any Option previously granted under the
Plan except as permitted by the provisions of Article 6 hereof.
Any amendment of the Plan may require the approval of the
Corporation's shareholders.
12. Government Regulation
12.1 The Corporation's obligation to issue and deliver Common Shares
under any Option is subject to:
(a) the satisfaction of all requirements under applicable securities
laws in respect thereof and obtaining all regulatory approvals as
the Corporation shall determine to be necessary or advisable in
connection with the authorization, issuance or sale thereof;
(b) the admission of Common Shares to listing on any stock exchange
on which such Common Shares may then be listed; and
(c) the receipt from the Participant of such representations,
agreements and undertakings as to future dealings in such Common
Shares as the Corporation determines to be necessary or advisable
in order to safeguard against the violation of the securities
laws of any jurisdiction.
In this connection, the Corporation shall take all reasonable
steps to obtain such approvals and registrations as may be
necessary for the issuance of such Common Shares in compliance
with applicable securities laws and for the listing of such
Common Shares on any stock exchange on which such Common Shares
are then listed.
13. Participant's Rights
A Participant shall not have any rights as a shareholder of the
Corporation until the issuance of a certificate for Common Shares
upon the exercise of an Option or a portion thereof, and then
only with respect to the Common Shares represented by such
certificate or certificates.
14. No Representation or Warranty
The Corporation makes no representation or warranty as to the
future market value of any Common Shares issued in accordance
with the provisions of the Plan.
15. Effective Date
The Plan shall become effective upon being adopted by the Board,
provided that no payments or distributions of Common Shares may
be made to any Participant under the Plan until such time as
shareholders approval of the Plan is obtained.
Plan approved by Consent Resolutions of the Board of Directors of
the Corporation dated as of July 27, 1999.
/s/ Robert S. Tyson
Robert S. Tyson, Secretary
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
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BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
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PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 60
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<RECEIVABLES> 0
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<INVENTORY> 0
<CURRENT-ASSETS> 60
<PP&E> 3,031
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<TOTAL-ASSETS> 256,499
<CURRENT-LIABILITIES> 374,722
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<OTHER-SE> (118,223)
<TOTAL-LIABILITY-AND-EQUITY> 256,499
<SALES> 0
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<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 132,890
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
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