UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1999
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( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File number 0-26709
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THE ZEBALLOS MINING COMPANY
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(Exact name of registrant as specified in charter)
Nevada 98-0201259
- ------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
34 - 3387 King George Highway
Surrey, BC, Canada V4P 1B7
- ------------------------------ --------------------
(Address of principal executive offices) (Zip Code)
604-538-5995
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Registrant's telephone number, including area code
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(Former name, address, and fiscal year, if changed since last report)
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), Yes [X] No [ ] and ( ) has been
subject to filing requirements for the past 90 days. Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the last practicable date.
Class Outstanding as of September 21, 1999
----------------------------------- -------------------------------------
Common Stock, $0.001 per share 11,075,400
<PAGE>
INDEX
Page
PART 1. Number
------
ITEM 1. Financial Statements (unaudited)......................... 3
Balance Sheet as at June 30, 1999........................ 4
Statement of Operations
For the three months ended June 30, 1999 and for
the period from March 4, 1999 (Date of
Incorporation) to June 30, 1999.................. 5
Statement of Changes in Shareholders' Equity
For the period from March 4, 1999 (Date of
Incorporation) to June 30, 1999.................. 6
Statement of Cash Flows
For the three months ended June 30, 1999 and for
the period from March 4, 1999 (Date of
Incorporation) to June 30, 1999................. 7
Notes to the Financial Statements........................ 8
ITEM 2. Plan of Operations....................................... 11
PART 11 Signatures............................................... 12
2
<PAGE>
PART 1 - FINANCIAL INFORMATION
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ITEM 1. FINANCIAL STATEMENTS
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The accompanying balance sheet of The Zeballos Mining Company (an exploration
stage company) at June 30, 1999 and the statement of operations and statement of
cash flow for the three months ended June 30, 1999 and for the period from March
4, 1999 (date of incorporation) to June 30, 1999 and the statement of
stockholders' equity for the period from March 4, 1999 (date of incorporation)
to June 30, 1999 have been prepared by the Company's management and they do not
include all information and notes to the financial statements necessary for a
complete presentation of the 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 quarter ended June 30, 1999, are not necessarily
indicative of the results that can be expected for the year ending December 31,
1999.
3
<PAGE>
THE ZEBALLOS MINING COMPANY
(An Exploration Stage Company)
BALANCE SHEET
June 30, 1999
(Unaudited - Prepared by Management)
ASSETS
CURRENT ASSETS
Bank $ 6,167
------------
$ 6,167
============
LIABILITIES
Accounts payable and accrued liabilities $ 314
------------
STOCKHOLDERS' EQUITY
Common stock
200,000,000 shares authorized, at $0.001 par
value, 11,075,400 shares issued and outstanding 11,075
Capital in excess of par value 6,115
Deficit accumulated during the development stage (11,337)
------------
Total Stockholders' Equity 5,853
------------
$ 6,167
===========
The accompanying notes are an integral part of these
unaudited financial statements.
4
<PAGE>
THE ZEBALLOS MINING COMPANY
(An Exploration Stage Company)
STATEMENT OF OPERATIONS
For the three months ended June 30, 1999 and for period from
March 4, 1999 (Date of Inception) to June 30, 1999
(Unaudited - Prepared by Management)
FOR THE THREE FROM INCEPTION
MONTHS ENDED TO
JUNE 30, 1999 JUNE 30, 1999
SALES $ -- $ --
----------- -----------
GENERAL AND ADMINISTRATIVE EXPENSES:
Accounting and audit 2,550 2,550
Bank charges and interest 38 120
Geology report -- 1,200
Incorporation costs written off -- 670
Management fees 1,500 2,000
Office expenses 488 488
Rent 900 1,200
Staking fees -- 369
Telephone 300 400
Transfer agent's fees -- 2,340
----------- -----------
NET LOSS $ 5,776 $ 11,337
=========== ===========
NET LOSS PER COMMON SHARE
Basic $ 0.0005 $ 0.001
=========== ===========
AVERAGE OUTSTANDING SHARES
Basic 11,075,400 8,953,259
=========== ===========
The accompanying notes are an integral part of these
unaudited financial statements.
5
<PAGE>
THE ZEBALLOS MINING COMPANY
(An Exploration Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
For the period from March 4, 1999 (Date of Inception)
to June 30, 1999
(Unaudited - Prepared by Management)
<TABLE>
<CAPTION>
CAPITAL IN
COMMON STOCK EXCESS OF ACCUMULATED
SHARES AMOUNT PAR VALUE DEFICIT
------ ------ --------- -------
<S> <C> <C> <C>
BALANCE MARCH 4, 1999 (date of inception) -- $ -- $ -- $ --
Issuance of common shares for cash at
$0.001 - March 14, 1999 5,050,000 5,050 --
Issuance of common shares for cash at
$0.001- March 16, 1999 6,000,000 6,000 --
Issuance of common shares for cash at
$0.10 - March 27, 1999 25,400 25 2,515 --
Capital contributions - expenses -- -- 3,600 --
Net operating loss for the period from
March 4, 1999 to June 30, 1999 -- -- -- (11,337)
---------- ---------- ---------- ----------
BALANCE JUNE 30, 1999 11,075,400 $ 11,075 $ 6,115 $ (11,337)
========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these
unaudited financial statements.
6
<PAGE>
THE ZEBALLOS MINING COMPANY
(An Exploration Stage Company)
STATEMENT OF CASH FLOWS
For the three months ended June 30, 1999 and for the period from
March 4, 1999 (Date of Inception) to June 30, 1999
(Unaudited - Prepared by Management)
<TABLE>
<CAPTION>
FOR THE THREE FROM INCEPTION
MONTHS ENDED TO
JUNE 30, 1999 JUNE 30, 1999
------------- -------------
<S> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net loss $ (5,776) $(11,337)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Increase in accounts payable (826) 314
Increase in accounts receivable 50 --
-------- --------
Net Cash from Operations (6,552) (11,023)
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CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from issuance of common stock -- 13,590
Capital contributions 2,700 3,600
-------- --------
2,700 17,190
-------- --------
Net Increase in Cash (3,852)
6,167
Cash at Beginning of Period 10,019 --
-------- --------
CASH AT END OF PERIOD $ 6,167 $ 6,167
======== ========
</TABLE>
The accompanying notes are an integral part of these
unaudited financial statements.
7
<PAGE>
THE ZEBALLOS MINING COMPANY
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
(Unaudited - Prepared by Management)
1. ORGANIZATION
The Company was incorporated under the laws of the State of Nevada on
March 4, 1999 with the authorized common shares of 200,000,000 shares
at $0.001 par value.
The Company was organized for the purpose of acquiring and developing
mineral properties. A mineral claim, with unknown reserves, has been
acquired. The Company has not established the existence of a
commercially minable ore deposit and therefore has not reached the
development stage and is considered to be in the exploration stage (see
Note 3).
The Company has completed a Regulation D offering of 11,025,400 shares
of its capital stock for cash.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Methods
------------------
The Company recognizes income and expenses based on the accrual method
of accounting.
Dividend Policy
---------------
The Company has not yet adopted a policy regarding payment of
dividends.
Income Taxes
------------
The Company has elected a fiscal year ending December 31, 1999 and has
not completed an operating period and therefore has not filed an income
tax return. However, the Company may incur an operating loss for the
period ending December 31, 1999 which will be available for carryover
and applied against future taxable income resulting in a tax benefit.
The potential tax benefit from any loss carry forward has been fully
offset by a valuation reserve because the use of any future tax benefit
is doubtful since the Company has no operations.
8
<PAGE>
THE ZEBALLOS MINING COMPANY
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
(Unaudited - Prepared by Management)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Loss per Share
--------------
Loss per share amounts are computed based on the weighted average
number of shares actually outstanding using the treasury stock method
in accordance with FABS Statement No. 128.
Cash and Cash Equivalents
-------------------------
The Company considers all highly liquid instruments purchased with a
maturity, at the time of purchase, of less than three months, to be
cash equivalents.
Capitalization of Mineral Claim Costs
-------------------------------------
Cost of acquisition, exploration, carrying, and retained unproven
properties are expensed as incurred. Cost incurred in proving and
developing a property ready for production are capitalized and
amortized over the life of the mineral deposit or over a shorter period
if the property is shown to have an impairment in value. Expenditures
for mining equipment are capitalized and depreciated over their useful
life.
Environmental Requirements
--------------------------
Environmental requirements related to the mineral claims acquired (Note
3) are unknown and therefore an estimate of any future cost cannot be
made.
Financial Instrument
--------------------
The carrying amount of financial instrument, being cash, is considered
by management to be its standard fair value.
Estimates and Assumptions
-------------------------
Management uses estimates and assumptions in preparing financial
statements in accordance with generally accepted accounting principles.
Those estimated and assumption affect the reported amounts of the
assets and liabilities, the disclosure of contingent assets and
liabilities, and the reported revenues and expenses. Actual results
could vary from the estimates that were assumed in preparing these
financial statements.
9
<PAGE>
THE ZEBALLOS MINING COMPANY
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1999
(Unaudited - Prepared by Management)
3. ACQUISITION OF MINERAL CLAIM
The Company has acquired one 18 unit metric mineral claim known as the
Zeb Au Claim located in the Zeballos mining camp near the town of
Zeballos about 300 kilometres northwest of Victoria, British Columbia
with an expiration date of March 1, 2000.
The claims may be retained by the Company by making a yearly lease
payment in the amount of CDN $1,800 on March 1, 2000 and CDN $3,600 on
March 1, 2001.
The claims have not been proven to have a commercial minable ore
reserve and therefore all costs for exploration and retaining the
properties have been expensed.
4. RELATED PARTY TRANSACTIONS
Related parties acquired 45% of the common stock issued.
The officers and directors of the Company are involved in other
business activities and they may, in the future, become involved in
additional business ventures which also may require their attention. If
a specific business opportunity becomes available, such persons may
face a conflict in selecting between the Company and their other
business interests. The Company has formulated no policy for the
resolution of such conflicts.
5. GOING CONCERN
The Company will need additional working capital to be successful in
its planned activities and continuation of the Company as a going
concern is dependent upon obtaining additional working capital and the
management of the Company has developed a strategy, which it believes
will accomplish this objective through additional equity funding, and
long term financing, which will enable the Company to operate in the
future.
Management recognizes that, if it is unable to raise additional
capital, the Company cannot be successful in its efforts.
10
<PAGE>
- --------------------------------------------------------------------------------
ITEM 2. PLAN OF OPERATIONS
- --------------------------------------------------------------------------------
The Company will explore the Zeb Au Claim in the Zeballos mining camp during the
latter part of 1999. Eventually in the next year the Company will investigate
the possibilities of acquiring additional mineral leases but this will not be
done until such time as an initially work program has been performed on the Zeb
Au Claim. To undertake a work program as recommended by Calvin Church,
Professional Geologist, in his report dated April 30, 1999 the Company will have
to raise additional funds either by way of advances for the officers and
directors, institutional borrowing or through the issuance of the Company's
common stock. Management has not yet decided as to the method it will use to
fund the exploration of its mineral claim.
Liquidity and Capital Resources
- -------------------------------
Presently the Company has sufficient cash on hand to maintain the operations of
the Company and to undertake a small grid program (running parallel lines from
two sides that intercept each other which allows for sampling at various points
in each square). Any program required in excess of undertaking a small grid
program will require additional capital.
Results of Operations
- ---------------------
There are no operations at this time.
11
<PAGE>
SIGNATURES
Pursuant to the requirements 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.
THE ZEBALLOS MINING COMPANY
(Registrant)
September 21, 1999 /s/ Stacey Bligh
-------------------------------- ----------------------------------
Date Stacey Bligh - Secretary-Treasurer
12
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM 10QSB AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 1082673
<NAME> THE ZEBALLOS MINING COMPANY
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