U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
[x] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarter ended September 30, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission File No.
VANADIUM INTERNATIONAL, INC
- ---------------------------
(Name of Small Business Issuer in its Charter)
NEVADA 88-0402908
--------------- --------------------
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
5466 Canvasback Rd
Blaine, WA 98230
-----------------------------
(Address of Principle Executive Offices)
Issuer's Telephone Number: (604) 683-6648
Check whether the Issuer (1) filed all reports required to be filed by section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the Company was required to file such reports). And (2) has been
subject to such filing requirements for the past 90 days.
(1) Yes X No (2) Yes X No
---- ---- ---- ----
<PAGE>
(APPLICABLE ONLY TO CORPORATE ISSUERS)
State the number of shares outstanding of each Issuer's classes of common
equity, as of the latest practicable date:
September 30, 1999: Common Stock - 20,901,000
DOCUMENTS INCORPORATED BY REFERENCE
A description of any "Documents Incorporated by Reference" is contained in Item
6 of this report.
Transitional Small Business Issuer Format Yes No X
----- -----
<PAGE>
VANADIUM INTERNATIONAL, INC.
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION PAGE
Item 1. Financial Statements:
Balance Sheets as of September 30, 1999 and December 31, 1998 5
Statements of Operations for the three months ended
September 30, 1999 and September 30, 1998 and the nine months ended
September 30, 1999 and September 30, 1998 and from Inception through
September 30, 1999 6
Statements of Cash Flow for the three months ended
September 30, 1999 and September 30, 1998 and the nine months ended
September 30, 1999 and September 30, 1998 and from Inception through
September 30, 1999 7
Notes to Financial Statements for the three months ended
September 30, 1999 and September 30, 1998 and the nine months ended
September 30, 1999 and September 30, 1998 and from Inception through
September 30, 1999 8
Item 2. Management's Plan of Operations 10
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 10
Item 2. Changes in Securities 10
Item 3. Defaults upon Senior Securities 10
Item 4. Submission of Matters to a Vote of Securities Holders 10
Item 5. Other Information 10
Item 6. Exhibits and Reports on Form 8 - K 10
Signatures 10
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
The Financial Statements of the Company required to be filed with this 10-QSB
Quarterly Report were prepared by management and commence on the following page,
together with related Notes. In the opinion of management, these Financial
Statements fairly present the financial condition of the Company, but should be
read in conjunction with the Financial Statements of the Company for the year
ended December 31, 1998 previously filed with the Securities and Exchange
Commission.
<PAGE>
Page 5
VANADIUM INTERNATIONAL, INC.
(FORMERLY U.S. VANADIUM CORP.)
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
September 30, 1999 and December 31, 1998
ASSETS
CURRENT ASSETS SEPT 30,1999 DEC 31,1998
CASH $ 328 $ 17,455
PREPAID EXPENSES - -
------------ ------------
TOTAL CURRENT ASSETS $ 328 $ 17,455
MINERAL ACQUISITIONS
MINERAL PROPERTY $ 100,000 $ 100,000
DEFERRED EXPLORATION 4,775 -
------------ ------------
TOTAL ASSETS $ 105,103 $ 17,455
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
ACCOUNTS PAYABLE $ 26,243 $ 25,821
DUE TO RELATED PARTIES 28,978 4,671
OTHER LIABILITIES 3,772 -
SHAREHOLDER LOANS 3,600 -
------------ ------------
TOTAL CURRENT LIABILITIES $ 62,593 $ 30,492
------------ ------------
NOTES PAYABLE - -
------------ ------------
TOTAL LIABILITIES $ 62,593 $ 30,492
------------ ------------
STOCKHOLDERS' EQUITY (DEFICIENCY)
SHARE CAPITAL - NOTE 2
AUTHORIZED:
80,000,000 common shares, $0.01 par value
20,000,000 preferred shares, $0.01 par value
ISSUED:
20,901,000 common shares $ 23,610 $ 23,430
CONTRIBUTED SURPLUS 125,890 117,070
DEFICIT ACCUMULATED DURING THE
DEVELOPMENT STAGE ( 106,990) $ (53,537)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) 42,510 86,963
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 105,103 $ 117,455
------------ ------------
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
<PAGE>
Page 6
VANADIUM INTERNATIONAL, INC.
(FORMERLY U.S. VANADIUM CORP.)
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FOR THE THREE MONTHS AND NINE MONTHS PERIODS ENDED SEPTEMBER 30, 1999 AND
SEPTEMBER 30, 1998 AND FOR THE PERIOD AUGUST 24, 1998 (INCEPTION) THROUGH
SEPTEMBER 30, 1999
UNAUDITED
<TABLE>
<CAPTION>
AUGUST 24 1998
THREE MONTHS THREE MONTHS NINE MONTHS NINE MONTHS (DATE OF
ENDED SEPT 30 ENDED SEPT 30 ENDED SEPT 30 ENDED SEPT 30 INCEPTION TO
1999 1998 1999 1998 SEPT 30,1999)
<S> <C> <C> <C> <C> <C>
SALES - - - - -
COST OF SALES - - - - -
------------ ------------ ------------ ------------ ------------
GROSS PROFIT - - - - -
OPERATING EXPENSES $ 15,670 $ - $ 53,453 $ - $ 88,046
EXPLORATION & DEV - - - - 18,944
------------ ------------ ------------ ------------ ------------
NET (LOSS) $(15,670) $ - $(53,453) $ - $(106,990)
BASIC AND DILUTED
LOSS PER SHARE $ (0.00) $ (0.00) $ (0.00) $ (0.00) $ (0.004)
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
<PAGE>
Page 7
VANADIUM INTERNATIONAL, INC.
(FORMERLY U.S. VANADIUM CORP.)
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS AND NINE MONTHS PERIODS ENDED SEPTEMBER 30, 1999 AND
SEPTEMBER 30, 1998 AND FOR THE PERIOD AUGUST 24, 1998 (INCEPTION) THROUGH
SEPTEMBER 30, 1999
UNAUDITED
<TABLE>
<CAPTION>
AUGUST 24 1998
THREE MONTHS THREE MONTHS NINE MONTHS NINE MONTHS (DATE OF
ENDED SEPT 30 ENDED SEPT 30 ENDED SEPT 30 ENDED SEPT 30 INCEPTION TO
1999 1998 1999 1998 SEPT 30,1999)
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C> <C> <C> <C>
NET (LOSS) $(15,670) $ $(53,453) $ - $(106,990)
ADD: ITEMS NOT
AFFECTING CASH
SHARES ISSUED FOR
EXPLOR. & DEV. $ - - - - 10,000
------------ ------------ ------------ ------------ -------------
$(15,670) $ - $(53,453) $ - $ (96,990)
CHANGES IN NON-CASH
ITEMS
DUE TO RELATED
PARTIES 12,000 - 26,504 - 31,175
ACCOUNTS PAYABLE 2,917 - (1,775) - 24,046
OTHER LIABILITIES - - 3,772 - 3,772
ACCOUNTS RECEIVABLE
DUE TO SHAREHOLDER'S 3,600 - 3,600 - 3,600
------------ ------------ ------------ ------------ -------------
NET CASH (USED) BY
OPERATING ACTIVITIES $ (2,847) $ - $(21,352) - $ (34,397)
------------ ------------ ------------ ------------ -------------
CASH FLOW FROM
INVESTING ACTIVITIES
ACQUISITION OF
MINERAL PROPERTY $ - $(50,000) $ - $(50,000) $(50,000)
MINERAL PROPERTY
EXPLORATION (3,600) - (4,775) - (4,775)
------------ ------------ ------------ ------------ -------------
NET CASH (USED) BY
INVESTMENT ACTIVITIES $(3,600) (50,000) (4,775) (50,000) (54,775)
------------ ------------ ------------ ------------ -------------
CASH FLOWS FROM
FINANCING ACTIVITIES
PROCEEDS FROM
ISSUANCE OF
COMMON SHARES $ - $ 50,000 $ 9,000 $ 50,000 $ 89,500
------------ ------------ ------------ ------------ -------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES $ - $ 50,000 $ 9,000 $ 50,000 $ 89,500
------------ ------------ ------------ ------------ -------------
NET INCREASE (DECREASE)
IN CASH $ (753) $ - $(17,127) $ - $ 328
CASH AT BEGINNING
OF PERIOD 1,081 - 17,455 - -
------------ ------------ ------------ ------------ -------------
CASH AT END
OF PERIOD $ 328 $ - $ 328 $ - $ 328
------------ ------------ ------------ ------------ -------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS
<PAGE>
Page 8
VANADIUM INTERNATIONAL, INC.
(FORMERLY U.S. VANADIUM CORP.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS FOR THE THREE MONTHS AND NINE MONTHS PERIODS
ENDED SEPTEMBER 30, 1999 AND SEPTEMBER 30, 1998 AND FOR THE PERIOD AUGUST 24,
1998 (INCEPTION) THROUGH SEPTEMBER 30, 1999.
1. BASIS OF PRESENTATION
In the opinion of management, the unaudited financial statements reflect all
normally recurring adjustments necessary to fairly present the Company's
financial position and results of operations for the periods indicated. The
accompanying interim financial statements should be read in conjunction with the
financial statements and related notes included in the Company's 10-KSB for the
period ended December 31, 1998, which has been filed with the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in the Company's annual financial statements have been omitted from the
quarterly financial statements based upon Securities and Exchange Commissions
rules and regulations. Net loss per common and common equivalent share was
computed based on the net loss divided by the weighted average number of common
and common equivalent shares outstanding, unless antidilutive, during the year
presented.
2. FINANCING
Common Shares Additional
# Par Value paid-in Capital
------------- ----------- ---------------
Balance, December 31,1998 20,883,000 $ 23,430 $ 117,070
Issuance of shares:
- pursuant to offering memorandum
for cash - at $0.50 per share 18,000 $ 180 $ 8,820
------------- ----------- ---------------
Balance, at September 30, 1999 20,901,000 $ 23,610 $ 125,890
------------- ----------- ---------------
The capital raised was used to fund operations. The Company anticipates needing
additional capital to fund operations during the upcoming year. The Company
intends to raise additional funds through private financings, or joint ventures
to permit further property exploration and development of various properties,
and to move one of its properties into the development and production stages
within the next two years.
3. RELATED PARTY TRANSACTIONS
The Company was charged the following management fees and exploration and
development expenses by two director of the company since inception:
Management Fees $48,000
Exploration and development expenses 16,819
----------
$64,819
Due to related parties as at September 30, 1999 includes $28,000 for unpaid
management fees and $978 for unpaid exploration and development costs. These
amounts are due to two directors of the company.
4. DESCRIPTION OF SECURITIES
The authorized capital of the Company consists of 80,000,000 shares of
Common Stock, par value $.01, of which 20,901,000 are outstanding. The material
terms of the securities are as follows:
All of the authorized common shares of the Company are of the same class
and, once issued, rank equally as to dividends, voting powers and participation
in assets. Holders of common shares are entitled to one vote for each share held
of record on all matters to be acted upon by the shareholders. Holders of common
shares are entitled to receive such dividends as may be declared from time to
time by the Board of Directors, in its discretion, out of funds legally
available therefrom. No shares have been issued subject to call or assessment.
There are no preemptive or conversion rights and no provisions for redemption or
purchase for cancellation, surrender, or sinking or purchase funds, nor any
cumulative voting rights. The Directors of the Company may from time to time
declare and authorize payment of dividends, as they deem advisable. Subject to
the rights of members, all dividends on shares shall be declared and paid
according to the number of shares held. No dividends have been declared since
incorporation. The outstanding shares are fully paid and non-assessable.
<PAGE>
Page 9
A class of preferred stock has been authorized with a par value of $0.01.
No shares of preferred stock have been authorized for issuance by the Board of
Directors as of the date of this statement. The rights, privileges and
preferences of any series of preferred stock shall be determined by the Board of
Directors at the time of issuance.
There is no provision in the Company's Articles of Incorporation, as
amended, or Bylaws that would delay, defer, or prevent a change in control of
the Company.
5. YEAR 2000 MATTERS
The inability of computers, software, and other equipment utilizing
microprocessors to recognize and properly process date fields containing a two
digit year reference such as "00" for the year 2000 is commonly referred to as
the Year 2000 issue. The primary Y2K risk to the Company's operations is
service disruption from third party providers that supply equipment for the
mining projects. Any disruption to these services would hinder the Company's
ability to operate. Therefore, efforts are currently under way to obtain Y2K
compliance certification from the Company's major equipment providers. Concern
about potential problems has been raised, but commitment to compliance is beyond
the Company's control.
The Company has not yet approved a formal contingency plan for Y2K issues,
however, a formal contingency plan is expected to be completed and approved
during 1999.
Item 2. Management's Plan of Operations
The Company is in its initial stages of exploration with no revenues or
income and is subject to all the risks inherent in the creation of a new
business. The Company has not yet had revenues from operations. Accordingly,
the following information centers upon the Company's plan of operation.
The Company owns the mineral rights and surface rights to three
properties on which it believes are located commercially mineable vanadium
deposits. The three properties are referred to as the Gibellini, Bisoni, and
Bisoni-McKay properties. The Company believes, based on a Pre-Feasibility
Report and Pro Forma Cash Flow Study for the Gibellini, Bisoni, Bisoni-Mckay
Vanadium Deposits in Eureka and Nye Counties, Nevada for the Company by Jules
Pierre LaPrairie, P.E., that the three properties contain approximately 19 to 21
million tons of 0.42% vanadium pentoxide hosted within Devonian black shale
facies.
To date, $23,719 has been spent by the company on exploration and
development expenses, including title research, claim staking and filing fees
with the State of Nevada and Counties, annual rental payments to the Bureau of
Land Management ($100 per claim), travel expenses for site visits to the
property, library research and acquisition of reports, data and investigations
from previous owners of the project.
The Company intends to continue with exploration and development of its
properties; although, the Company's focus for the next two years will be to have
one of its properties move into the production stage. Additional exploration
and development will occur on the first property to be exploited and on other
Company properties.
Liquidity
To date the Company's activities have been financed primarily through the
sale of equity securities. No assurance can be given that the proceeds of the
private offering of the Company's securities or any other source of funding
described above will provide sufficient funds to undertake all of the Company's
planned project expansion for the next twelve months. It is anticipated that
significant additional funds will be required to complete the development of any
commercially viable project. There can be no assurance that the Company will be
able to obtain such additional financing, and whether the terms of such
financing would be favorable to the Company. Failure to obtain such financing
could be detrimental to the success of the project. No contracts or commitments
have been entered into at this time.
<PAGE>
Page 10
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None; not applicable.
Item.2. Changes in Securities and Use of Proceeds.
During the second quarter of 1999, the Company did not issue any
securities.
Item 3. Defaults Upon Senior Securities.
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None; not applicable.
Item 5. Other Information.
None; not applicable.
Item 6. Exhibits and Reports on Form 8-K.
Exhibit
(a) Exhibits.* Number
None.
(b) Reports on Form 8-K.
* A summary of any Exhibit is modified in its entirety by reference
to the actual Exhibit.
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.
VANADIUM INTERNATIONAL INC
Date: 11/10/99 By: /s/ Kenneth B. Liebscher
President and Director
Date: 11/10/99 By: /s/ Dennis LaPrairie
Secretary/Treasurer and Director
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AND STATEMENT OF OPERATIONS FOR VANADIUM INTERNATIONAL INC. A DEVELOPMENT
STAGE COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JUL-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 328
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 328
<PP&E> 104,775
<DEPRECIATION> 0
<TOTAL-ASSETS> 105,103
<CURRENT-LIABILITIES> 62,593
<BONDS> 0
0
0
<COMMON> 23,610
<OTHER-SE> 125,890
<TOTAL-LIABILITY-AND-EQUITY> 105,103
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 15,670
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (15,670)
<INCOME-TAX> 0
<INCOME-CONTINUING> (15,670)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (15,670)
<EPS-BASIC> (0.00)
<EPS-DILUTED> (0.00)
</TABLE>
