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 SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended January 31, 2000
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: 0-27659
URANIUM POWER CORPORATION
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(Exact name of small business issuer as specified in its charter)
Colorado None
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
206-475 Howe Street, Vancouver, British Columbia, Canada V6C 2B3
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(Address of principal executive offices)
(604) 685-8355
-------------------------
(Issuer's telephone number)
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the registrant (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 registrant was required to file such reports) and (2)
has been subject to such filing requirements for the past 90 days.
YES [X] NO [ ]
The number of shares outstanding of the issuer's classes of common equity, as of
February 21, 2000 is 6,927,500 shares of Common Stock.
Transitional Small Business Disclosure Format (check one): YES [ ] NO [X]
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
URANIUM POWER CORPORATION
Interim Consolidated Financial Statements
January 31, 2000
(Unaudited)
INDEX Page
----- ----
Financial Statement
Balance Sheet 3
Statements of Operations 4
Statement of Stockholders' Equity 5
Statement of Cash Flows 6
Notes to Financial Statements 7-9
2
<PAGE>
<TABLE>
<CAPTION>
URANIUM POWER CORPORATION
(An Exploration Stage Company)
Balance Sheets
January 31, 2000 (Unaudited) and April 30, 1999
(U.S. Dollars)
January 31, April 30,
2000 1999
---------- --------
(Unaudited) (Audited)
<S> <C> <C>
Assets
Current
Cash ............................................................................ $ 9,929 $ 3,149
Accounts receivable ............................................................. 9,626 0
--------- ---------
19,555 3,149
Properties (note 3) ............................................................... 93,600 59,459
--------- ---------
$ 113,155 $ 62,608
========= =========
Liabilities
Accounts Payable and Accrued Liabilities .......................................... $ 2,767 $ 3,082
--------- ---------
Stockholders' Equity
Capital Stock
Authorized
40,000,000 shares common stock with a par value of $0.001 each
10,000,000 shares preferred stock with a par value of $0.001 each
Issued
6,927,500 shares common stock ............................................... 6,925 6,278
Treasury Stock
23,000 shares common stock .................................................... (23) 0
Additional Paid-In Capital ........................................................ 548,848 264,684
Deficit Accumulated During Exploration Stage ...................................... (445,362) (211,436)
--------- ---------
Total Stockholders' Equity ........................................................ 110,388 59,526
--------- ---------
$ 113,155 $ 62,608
========= =========
</TABLE>
See notes to financial statements.
3
<PAGE>
<TABLE>
<CAPTION>
URANIUM POWER CORPORATION
(An Exploration Stage Company)
Statements of Operations
Three Months and Nine Months Ended January 31, 2000 (Unaudited)
(U.S. Dollars)
Cumulative
Amounts During
Exploration
Three Months Ended Nine Months Ended Stage to
January 31, January 31, January 31,
2000 1999 2000 1999 2000
---- ---- ---- ---- --------------
<S> <C> <C> <C> <C> <C>
Expenditures
Exploration costs
(note 3) ................... $ 169,094 $ 0 $ 211,260 $ 0 $ 348,056
Professional fees ............ 4,755 113 17,674 4,913 36,406
Advertising and
promotion .................. 1,239 0 2,602 0 33,202
Rent ......................... 2,050 0 4,405 0 5,280
Office ....................... (1,026) 29 (3,323) 168 2,550
Transfer agent fee ........... 596 0 1,072 0 1,723
Travel ....................... 236 0 236 0 18,145
----------- ----------- ----------- ----------- -----------
Net Loss for Period ............ $ (176,944) $ (142) $ (233,926) $ (5,081) $ (445,362)
=========== =========== =========== =========== ===========
Loss Per Share ................. $ (0.03) $ (0.00) $ (0.04) $ (0.00)
=========== =========== =========== ===========
Weighted Average
Number of Shares
Outstanding .................. 6,884,600 6,527,380
=========== ===========
</TABLE>
See notes to financial statements.
4
<PAGE>
<TABLE>
<CAPTION>
URANIUM POWER CORPORATION
(An Exploration Stage Company)
Statements of Stockholders' Equity (Deficiency)
Nine Months Ended January 31, 2000 (Unaudited) and Year Ended April 30, 1999
(U.S. Dollars)
Deficit
Accumulated Total
Additional During the Stockholders'
Common Stock Treasury Stock Paid-In Exploration Equity
Shares Par Value Shares Par Value Capital Stage (Deficiency)
------ --------- ------ --------- ---------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, April 30, 1998 .......... 6,000,000 $ 6,000 0 $ 0 $ 91,834 $ (700) $ 97,134
Common stock issued
For subscriptions .............. 1,000,000 1,000 0 0 606,005 0 607,005
For resource properties ........ 200,000 200 0 0 137,131 0 137,331
Share issue costs ................ 0 0 0 0 (15,586) 0 (15,586)
Net loss ......................... 0 0 0 0 0 (210,736) (210,736)
--------- ---------- --------- ---------- ---------- ---------- ----------
Balance April 30, 1999 ........... 7,200,000 7,200 0 0 819,384 (211,436) 615,148
--------- ---------- --------- ---------- ---------- ---------- ----------
Common stock issued for cash ..... 600,000 600 0 0 299,595 0 300,195
Common stock issued for
finder's fee ................... 50,000 50 0 0 24,950 0 25,000
Common stock returned to
treasury for cancellation
(note 6) ....................... (922,500) (925) 0 0 (555,154) 0 (556,079)
Treasury stock (note 6) .......... 0 0 (23,000) (23) (14,927) 0 (14,950)
Share issue costs ................ 0 0 0 0 (25,000) 0 (25,000)
Net loss for nine months ......... 0 0 0 0 0 (233,926) (233,926)
--------- ---------- --------- ---------- ---------- ---------- ----------
Change for nine months ........... (272,500) (275) (23,000) (23) (270,536) (233,926) (504,760)
--------- ---------- --------- ---------- ---------- ---------- ----------
Balance, January 31, 2000 ........ 6,927,500 $ 6,925 (23,000) $ (23) $ 548,848 $ (445,362) $ 110,388
========= ========== ========= ========== ========== ========== ==========
</TABLE>
See notes to financial statements.
5
<PAGE>
<TABLE>
<CAPTION>
URANIUM POWER CORPORATION
(An Exploration Stage Company)
Statements of Cash Flow
Three Months and Nine Months Ended January 31, 2000 (Unaudited)
(U.S. Dollars)
Three Months Nine Months
Ended Ended
January 31, January 31,
2000 2000
------------ -----------
(unaudited) (unaudited)
<S> <C> <C>
Operating Activities
Net loss ............................................................... $(176,944) $(233,926)
Change in Operating Assets and Liabilities
Accounts receivable .................................................... (9,626) (9,626)
Accounts payable ....................................................... 48 (315)
--------- ---------
Net Cash Used in Operating Activities .................................... (186,522) (243,867)
--------- ---------
Investing Activity
Property acquisition ................................................... (9,141) (9,141)
--------- ---------
Financing Activities
Issuance of shares for cash ............................................ 0 300,195
Common stock returned to treasury ...................................... 0 (7,306)
Cancellation of common stock ........................................... 0 (8,101)
Repayment of loan payable .............................................. 0 0
Share issue costs ...................................................... 0 (25,000)
Restricted cash ........................................................ 122,410 0
--------- ---------
Net Cash Provided By Financing Activities ................................ 122,410 259,788
--------- ---------
Inflow (Outflow) of Cash ................................................. (73,253) 6,780
Cash, Beginning of Period ................................................ 83,182 3,149
--------- ---------
Cash, End of Period ...................................................... $ 9,929 $ 9,929
========= =========
</TABLE>
See notes to financial statements.
6
<PAGE>
URANIUM POWER CORPORATION
(An Exploration Stage Company)
Notes to Financial Statements
Nine Months Ended January 31, 2000 (Unaudited)
(U.S. Dollars)
- --------------------------------------------------------------------------------
1. BASIS OF PRESENTATION
These unaudited financial statements have been prepared in accordance with
generally accepted accounting principles in the United States for interim
financial information. These financial statements are condensed and do not
include all disclosures required for annual financial statements. The
organization and business of the Company, accounting policies followed by
the Company and other information are contained in the notes to the
Company's audited financial statements for the year ended April 30, 1999.
In the opinion of the Company's management, these financial statements
reflect all adjustments necessary to present fairly the Company's financial
position at January 31, 2000 and April 30, 1999 and the consolidated
results of operations and the statement of cash flows for the three months
and nine months ended January 31, 2000. The results of operations for the
three months and nine months ended January 31, 2000 are not necessarily
indicative of the results to be expected for the entire fiscal year.
2. LOSS PER SHARE
Net loss per share computations are based on the weighted average number of
shares outstanding during the period.
3. PROPERTIES
(a) Hocking Lake Property and Henday Lake Property
By agreement dated April 13, 1998, the Company acquired all assets of
Athabasca Uranium Syndicate (a British Columbia, Canada syndicate)
which consisted of cash and the Hocking Lake Property and Henday Lake
Property. These properties were acquired in 1997 by the syndicate for
$59,549 ($82,270 Cdn.) and are reflected in the financial statements
at the sellers' historical cost as the sellers are the controlling
shareholders.
Consideration given to the members of the syndicate was 6,000,000
common shares of the Company at a par value of $0.001 each (issued)
and a stated value of $97,834 being the cost of the assets acquired.
(b) Saskatchewan Uranium Properties
By agreement dated December 16, 1998, the Company has options to
acquire a 100% interest in 11 mining claims in Saskatchewan, Canada,
upon incurring cumulative expenditures of $338,000 (Cdn. $500,000) by
December 31, 1999 and $1,690,000 (Cdn. $2,500,000) by December 31,
2002. The optioner can earn back a 35% interest by incurring
cumulative expenditures of not less than $2,028,000 (Cdn. $3,000,000)
before December 31, 2006. A royalty is payable at 2% of gross value
(as defined) of production if the optioner does not earn back the 35%
interest.
7
<PAGE>
URANIUM POWER CORPORATION
(An Exploration Stage Company)
Notes to Financial Statements
Nine Months Ended January 31, 2000 (Unaudited)
(U.S. Dollars)
- --------------------------------------------------------------------------------
3. PROPERTIES (Continued)
By an agreement dated March 24, 1999, between the Company and Pacific
Amber Resources Ltd., the latter will earn a 50% interest in the
Saskatchewan Uranium Properties and all of the Company's rights,
licences and permits pertinent thereto held for the specific use and
enjoyment thereof by completing the initial program and incurring
$338,000 (Cdn. $500,000) in expenditures on or before May 31, 2000, as
amended. A total of $255,410 (Cdn. $380,800) was incurred as at
December 31, 1999). In return, the Company issued the optionee 200,000
common shares at a deemed value of $0.65 each.
All exploration costs incurred on these properties have been expensed
as incurred resulting in no recognition of an asset on the balance
sheet. As a result of this policy the transfer of a 50% interest to
Pacific resulted in no gain or loss as there were no proceeds from the
disposition. Additionally, the Company's issuance of 200,000 shares to
Pacific was expensed as exploration costs when incurred.
(c) Northern mining property
By agreement dated October 29, 1998 (subsequently extended to December
1, 1999) the Company acquired 100% interest in a mining claim in
Northern Mining District, Saskatchewan by issuing 50,000 free trading
shares as a finder's fee to an unrelated party and paying $13,375 Cdn.
to the owner of the property. The owner has the right to receive $0.35
per pound of the product from the claim if the price of the product is
$18 per pound or less and $0.50 per pound where the price of the
product is $18 per pound or more.
This transaction was accounted for valuing the shares issued at
$25,000 plus the seller's historical cost of $9,141 ($13,375 Cdn.).
4. STOCK OPTION PLAN
The Company has adopted an incentive and a nonstatutory stock option plan
effective August 31, 1999 ("the 1999 plan") whereby up to 1,200,000 shares
of common stock may be optioned and sold up to August 31, 2009 or until
sooner terminated. Incentive Options granted will have an exercise price of
not less than 100% of fair market value (as defined) per share on the date
of grant, non-qualified Options will have an exercise price of not less
than 80% of fair market value. Options are granted for a term of ten years
except incentive options granted to persons owning more than 10% of the
combined voting stock of all classes, in which case the term is five years.
5. WARRANTS
During the nine months ended January 31, 2000, the Company issued 600,000
warrants each exercisable into one share of common stock at $0.50 per
share. The warrants expire October 7, 2001.
8
<PAGE>
URANIUM POWER CORPORATION
(An Exploration Stage Company)
Notes to Financial Statements
Nine Months Ended January 31, 2000 (Unaudited)
(U.S. Dollars)
- --------------------------------------------------------------------------------
6. COMMON STOCK
(a) Subscriptions not paid
In April 1999, the Company received subscriptions and issued a
Treasury Order for the issue of 922,500 common shares. These shares
were unpaid at April 30, 1999 and were held by the Company pending
receipt of the proceeds of issue. As the funds were not received the
shares were returned to treasury for cancellation in June 1999.
(b) Treasury stock
During the nine months ended January 31, 2000 the Company purchased
23,000 shares of its capital stock from the original owners who had
acquired the shares prior to April 30, 1999 in a private placement.
The stock was purchased for the same amount as the proceeds from
original issue.
7. RELATED PARTY TRANSACTIONS
The following transactions occurred with parties who are related by way of
minority share ownership in the capital stock of the Company and being a
director of the Company and corporate shareholders.
(a) Acquisition of assets of Athabasca Uranium Syndicate (note 1) in
exchange for 6,000,000 common shares.
(b) Agreement with Pacific Amber Resources Ltd. (note 3(b)) and issuance
of 200,000 common shares under the agreement.
(c) Acquisition of property from a minority shareholder who is an officer
and director (note 3(c)).
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following information should be read in conjunction with the unaudited
consolidated financial statements included herein, which are prepared in
accordance with generally accepted accounting principles ("GAAP") in the United
States for interim financial information. All dollar amounts in this form are in
U.S. dollars unless otherwise stated.
Results of Operations
As of the date of this Report, the operations of Uranium Power Corporation (the
"Company") have been speculative. The Company incurred a loss in the quarter
ended January 31, 2000, and has not had revenues from its operations to date.
The Company has been dependent, and continues to rely upon, the sale of equity
securities in order to fund its exploration activities. Its ability to continue
its operations is dependent on the ability of the Company to continue to obtain
financing.
The Company is involved in the exploration of uranium properties located in the
Athabasca Basin of northern Saskatchewan, Canada. It owns a 100% interest in two
properties totaling 78,352 acres, and has options to acquire a 100% interest in
seven additional properties totaling 79,705 acres. Six of these properties, with
eleven mining claims, may be acquired through an option agreement with Phelps
Dodge Corporation of Canada, Ltd. ("PDC"). The Company has made an agreement
with Pacific Amber Resources Ltd. ("PAR"), whereby PAR may earn 50% of the
Company's interest in the PDC properties by completing an initial exploration
program of $338,000 ($500,000 Can.) by the extended deadline of May 31, 2000. A
total of $229,013 ($338,777 Can.) was expended as of January 31, 2000. Work
consisted of 5,066 feet of diamond drilling in five holes, electromagnetic
surveys (55 line miles) and lithogeochemical sampling. Anomalous uranium was
encountered in two drill holes, and one of these also had anomalous nickel,
cobalt and arsenic. This finding is typical of the type of uranium deposits
found in the Athabasca Basin.
During this quarter, Geoterrex-Dighem conducted an airborne electromagnetic and
magnetic survey on the Company's two 100% owned properties (Henday Lake and
Hocking Lake) and its seventh optional property (Hump Lake). The cost of this
survey was $162,332 ($240,136 Can.). Also during this quarter, Patterson Mining
Geophysics Ltd. completed ground geophysical surveys on the Henday Lake and
Hocking Lake properties.
During the quarter and nine months ended January 31, 2000, the Company expended
$169,094 and $211,260, respectively, for exploration costs.
Changes in Financial Condition
Net loss for the three-month period ended January 31, 2000 was $176,944, or
$0.03 per share, compared with a net loss of $142, or $0.00 per share, for the
same quarter of 1999. The Company will continue to rely on funding from
financing sources in order to proceed with its development activities.
10
<PAGE>
Forward-Looking Statements
The following cautionary statements are made pursuant to the Private
Securities Litigation Reform Act of 1995 in order for the Company to avail
itself of the "safe harbor" provisions of that Act in the future. Discussions
and information in this document which are not historical facts should be
considered forward-looking statements. With regard to forward-looking
statements, including those regarding the potential revenues from the mining and
development of uranium properties, and the business prospects or any other
aspect of the Company, actual results and business performance may differ
materially from that projected or estimated in such forward-looking statements.
The Company has attempted to identify in this document certain of the factors
that it currently believes may cause actual future experience and results to
differ from its current expectations. In addition to the risks cited above
regarding the need for the Company to continue to obtain financing to be able to
continue operating, and risks specific to the exploration and mining of uranium,
differences may be caused by a variety of factors; including adverse economic
conditions, entry of new and stronger competitors, inadequate capital and the
inability to obtain funding from third parties, unexpected costs, inability to
obtain or keep qualified personnel, and the volatility of uranium markets and
prices.
11
<PAGE>
PART II - OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
(c) On December 8, 1999, the Company issued 50,000 shares of its Common Stock
to an individual as a finders fee for property acquired by the Company.
These securities were offered pursuant to the exemption from registration
contained in Section 4(2) of the Securities Act of 1933, as amended. No
underwriter was involved in the transaction.
(f) The registration statement of the Company was effective on December 13,
1999. The Commission file number is 0-27659.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit 3(i) - Articles of Incorporation. (1)
Exhibit 3(ii) - Bylaws. (1)
Exhibit 27.1 - Financial Data Schedule.
- ----------------
(1) Incorporated by reference from Registration Statement on Form 10-SB,
File No. 0-27659, filed with the SEC on October 14, 1999.
(b) Reports on Form 8-K: During the quarter ended January 31, 2000, the Company
filed no reports on Form 8-K.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Form 10-QSB to be signed on its behalf by the
undersigned thereunto duly authorized.
URANIUM POWER CORPORATION
Date: March 14, 2000 By: /s/ Thornton J. Donaldson
-------------------------------------
Thornton J. Donaldson, President and
Director
Date: March 14, 2000 By: /s/ William G. Timmins
-------------------------------------
William G. Timmins, Secretary and
Director
13
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> APR-30-2000
<PERIOD-START> NOV-01-1999
<PERIOD-END> JAN-31-2000
<CASH> 9,929
<SECURITIES> 0
<RECEIVABLES> 9,626
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 19,555
<PP&E> 93,600
<DEPRECIATION> 0
<TOTAL-ASSETS> 113,155
<CURRENT-LIABILITIES> 2,767
<BONDS> 0
0
0
<COMMON> 6,925
<OTHER-SE> 103,483
<TOTAL-LIABILITY-AND-EQUITY> 113,155
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 176,944
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (176,944)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (176,944)
<EPS-BASIC> (0.03)
<EPS-DILUTED> (0.03)
</TABLE>
