(THIS SPACE LEFT INTENTIONALLY BLANK)
DOWNLOAD FORMATTING INSTRUCTIONS FOR CORRECT PAGINATION:
PAGE SETUP: .5"TOP, .5"BOTTOM, .5"LEFT, .5"RIGHT
TYPE: COURIER NEW, 10pt EXCEPT WHERE INDICATED OTHERWISE WITHIN THE TEXT
BEGIN PAGE AT "START"
<PAGE>
START***************************************************************************
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-KSB
(Mark One)
[X] Annual report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 [Fee Required] for the fiscal year ended
December 31, 1999, or
[ ] Transition report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 [No Fee Required] for the transition period
from to
METALINE MINING & LEASING COMPANY
(Exact name of registrant as specified in its charter)
State of Washington 91-06843860
______________________________________ ___________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
601 West Main Avenue, Suite 714
Spokane, Washington 99201-0677
__________________________________________ _______________
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) 509-455-9077
Securities registered under Section 12(b) of the Exchange Act:
Title of each class Name of each exchange
on which registered
None None
Securities registered under Section 12(g) of the Exchange Act: None
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the 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 ( )
Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this
Form 10-KSB or any amendment to this Form 10-KSB. (X)
State issuer's revenues for its most recent fiscal year. $46,848
State the aggregate market value of the voting and non-voting common equity
held by non-affiliates computed by reference to the price at which the
common equity was sold, or the average bid and asked price of such common
equity, as of a specified date within 60 days. (See definition of
affiliate in Rule 12b-2 of the Exchange Act.) [Amended in release
No. 33-7419 (85,938), effective June 13, 1997, 62 F.R. 26387.] $0.00
DOCUMENT PAGE: 1 OF 20
<PAGE>
Note: If determining whether a person is an affiliate will involve an
unreasonable effort and expense, the issuer may calculate the aggregate
market value of the common equity held by non-affiliates on the basis of
reasonable assumptions, if the assumptions are stated.
(ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING DURING THE PAST FIVE YEARS)
Check whether the issuer has filed all documents and reports required to
be filed by Section 12, 13, or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court. Yes ( ) No ( )
Not Applicable
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date. 14,555,668
DOCUMENTS INCORPORATED BY REFERENCE
If the following documents are incorporated by reference, briefly describe
them and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.)
into which the document is incorporated: (1) any annual report to
security holders; (2) any proxy or information statement; and (3) any
prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of
1933 ("Securities Act"). The list documents should be clearly described
for identification purposes (e.g., annual report to security holders for
fiscal year ended December 24, 1990). None
Transitional Small Business Disclosure Format (check one): Yes ( ) No (X)
********************************************************************************
(This space left blank intentionally)
DOCUMENT PAGE: 2 OF 20
<PAGE>
PART I
ITEM 1. DESCRIPTION OF BUSINESS
(A) BUSINESS DEVELOPMENT
The Registrant was incorporated in the State of Washington in 1927.
Historically, the Registrant was engaged in the mineral exploration business.
The Company does not currently hold an interest in any mineral exploration
properties and has no active business operations.
The Registrant is currently seeking to acquire an interest in a business
opportunity. Due to the Registrant's limited assets and its inability to raise
additional financing due to the lack of a market for its Common Stock, it is
anticipated that any such acquisition would be a "reverse take-over"
accomplished through a merger or share exchange. In such event, the
Registrant's existing shareholders would likely become minority shareholders in
the surviving entity. The Registrant is not currently evaluating any specific
acquisition opportunity.
(B) BUSINESS OF ISSUER
The Registrant has no active business operations. The Registrant is currently
seeking to acquire an interest in a business opportunity.
The Registrant currently has no employees.
(C) REPORTS TO SECURITY HOLDERS
You may read and copy any materials filed with the SEC at the SEC's Public
Reference Room at 450 Fifth Street, N. W., Washington, D.C. 20549. You may
obtain information on the operation of the Public Reference Room by calling the
SEC at 1 (800) SEC-0330. The SEC maintains an Internet site (http://www.sec.gov)
that contains reports, proxy and information statements and other information
regarding the Company that is filed electronically with the SEC.
ITEM 2. DESCRIPTION OF PROPERTY
The Company has no offices or facilities. The Company's activities are carried
out from the office of one of its officers and directors.
The Company disposed of the last of its interests in mineral properties in 1990.
ITEM 3. LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Registrant is a
party or of which any of its property is subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted during the fourth quarter of the fiscal year covered by
this report to a vote of security holders, through the solicitation of proxies
or otherwise.
DOCUMENT PAGE: 3 OF 20
<PAGE>
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
(A) MARKET INFORMATION
There is no established public trading market for the Registrant's common
equity. There has been no market nor reported quote for the Registrant's common
equity since at least 1991.
(B) HOLDERS
There are approximately 1,273 holders of the Registrant's common equity at the
date hereof.
(C) DIVIDENDS
To the management's knowledge, the Registrant has never paid a dividend. There
is no plan to pay dividends for the foreseeable future.
(D) UNREGISTERED SALES
During the period covered by this report the Company has sold no equity
securities that were not registered under the Securities Act of 1933, as
amended.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN
OF OPERATION
PLAN OF OPERATION
Historically, the Company has been engaged in mineral exploration activities.
Exploration for commercially minable ore deposits is highly speculative and
involves risks greater than those involved in the discovery of mineralization.
Mining companies use the evaluation work of professional geologists,
geophysicists, and engineers in determining whether to acquire an interest in a
specific property, or whether or not to commence exploration or development
work. These professionals are not always scientifically exact, and in some
instances result in the expenditure of substantial amounts of money on a
property before it is possible to make a final determination as to whether or
not the property contains economically minable ore bodies. The economic
viability of a property cannot be finally determined until extensive exploration
and development work, plus a detailed economic feasibility study, has been
performed. Also, the market prices for mineralization produced are subject to
fluctuation and uncertainty, which may negatively affect the economic viability
of properties on which expenditures have been made. Given the foregoing risks
and the Registrant's extremely limited resources, Management has decided not to
attempt to again become actively engaged in mineral exploration.
During 1999, the Company's only revenue was interest income in the amount of
$46,848.
The Registrant is currently seeking to acquire an interest in an as-yet
unidentified business opportunity. Due to the Registrant's limited assets, it
is anticipated that any such acquisition would be a "reverse take-over"
accomplished through a merger or share exchange. In such event, the
Registrant's existing shareholders would likely become minority shareholders in
the surviving entity. The Company is not currently evaluating any specific
business opportunity.
DOCUMENT PAGE: 4 OF 20
<PAGE>
The Company believes it can satisfy it's foreseeable cash requirements. The
Company does not believe that it will have to raise additional funds in the next
twelve months.
ITEM 7. FINANCIAL STATEMENTS
Financial Statements of the Company for the fiscal years ended December 31, 1998
and December 31, 1999 audited by LeMaster & Daniels PLLC, are included elsewhere
in this Form 10-KSB.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
During the registrant's two most recent fiscal years and the subsequent interim
period, no independent accountant who was previously engaged as the principal
accountant to audit the registrant's financial statements, or independent
accountant who was previously engaged to audit a significant subsidiary and on
whom the principal accountant expressed reliance in its report, has resigned (or
indicated it has declined to stand for re-election after the completion of the
current audit) or was dismissed.
The Registrant has engaged LeMaster & Daniels PLLC as Independent Auditor for
the year ended December 31, 2000.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
DIRECTORS AND EXECUTIVE OFFICERS
(A) IDENTIFICATION OF DIRECTORS
Set forth below is the name, age and length of service of the Company's present
directors:
<TABLE>
NAME (AGE) POSITION LENGTH OF SERVICE
- -------------------------- ------------------- -------------------
<S> <C> <C>
Albert Zlotnick (76) Director, Chairman Since 1998
William R. Green (61) Director Since 1993
Gregory B. Lipsker (49) Director Since 1993
Eunice R. Campbell (54) Director 1992 and since 1994
</TABLE>
The directors are elected for a one-year term until their successors have been
elected and qualified. There are no arrangements or understandings between any
of the directors and other persons pursuant to which such person was selected as
a director.
(B) IDENTIFICATION OF EXECUTIVE OFFICERS
Set forth below is the name, age and length of service of the Company's present
Executive Officers:
<TABLE>
NAME (AGE) POSITION LENGTH OF SERVICE
- ----------------------------- ------------------------------ -----------------
<S> <C> <C>
Gregory B. Lipsker (49) President Since 1994
William R. Green (61) Vice President/Asst. Secretary Since 1994
Eunice R. Campbell (54) Secretary/Treasurer Since 1992
</TABLE>
DOCUMENT PAGE: 5 OF 20
<PAGE>
Executive Officers are appointed to serve until the meeting of the Board of
Directors following the next annual meeting of shareholders and until their
successors have been elected and qualified. There are no arrangements or
understandings between any of the directors, officers, and other persons
pursuant to which such person was selected as an Executive Officer.
Set forth below is certain biographical information regarding each Director and
Executive Officer of the Company.
Albert M. Zlotnick - Mr. Zlotnick is and has been for the past 40 years an
investor in private and public companies. Mr. Zlotnick is currently an owner or
principal investor in 3 private corporations and one partnership and the
principal investor in more than 10 public corporations.
Gregory B. Lipsker - Mr. Lipsker is a practicing attorney in Spokane,
Washington. Mr. Lipsker's practice emphasizes corporate and securities matters.
Mr. Lipsker is an Executive Officer and Director of Cimarron-Grandview Group,
Inc., a publicly-held, inactive mining exploration company.
Dr. William R. Green - William R. Green is a mining engineer and geologist, and
was a professor of mining engineering at the University of Idaho from 1965 to
1983. He has been actively involved in the mining business since 1962 and is a
former officer and director of Yamana Resources and currently an officer and
director of Canadian public companies: Maya Gold Limited and Petromin Resources
Ltd., and U.S. public companies Mines Management, Inc. and Cimarron Grandview
Group, Inc.
Eunice R. Campbell - Mrs. Campbell is a retired businesswoman. Prior to her
retirement in 1987, Mrs. Campbell was the owner of Spokane Guaranty Company, a
stock transfer agency. Mrs. Campbell is an Executive Officer and Director of
Cimarron-Grandview Group, Inc., a publicly-held, inactive mining exploration
company.
(C) IDENTIFICATION OF CERTAIN SIGNIFICANT EMPLOYEES
The Registrant has no employees.
(D) FAMILY RELATIONSHIPS
There is no family relationship between any Director, Executive Officer, or
person nominated or chosen by the Registrant to become a Director or Executive
Officer
(E) INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
No Director, or person nominated to become a Director or Executive Officer, has
been involved in any of the enumerated events during the past five years.
(F) PROMOTERS AND CONTROL PERSONS
Not Applicable
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Based solely upon a review of Forms 3 and 4 and amendments thereto furnished to
the Registrant pursuant to Section 240.16a-3 during its most recent fiscal year
and Form 5 and amendments thereto furnished to the Registrant with respect to
the most recent fiscal year, all executive officers and directors of the Company
timely filed the reports required under Section 16(a) of the Securities Exchange
Act of 1934, as amended.
DOCUMENT PAGE: 6 OF 20
<PAGE>
ITEM 10. EXECUTIVE COMPENSATION
(A) EXECUTIVE OFFICERS
The following table sets forth the compensation paid by the Company to its Chief
Executive Officer and executive officers whose total annual salary and bonus
exceeded $100,000 during the past three calendar years ("Executive Officers").
Except as set forth below, no officer or Executive Officer of the Company
received compensation in excess of $100,000 during the past three calendar
years. This information includes the dollar value of base salaries, bonus awards
and number of stock options granted, and certain other compensation, if any.
<TABLE>
Summary Compensation Table
- ----------------------------
Long-Term Compensation
Annual Compensation Awards Payouts
- ------------------------------------------- ---------------------- ------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Name Other Restricted Securities
and Annual Stock Underlying LTIP All Other
Principal Year Salary Bonus Comp. Awards(1) Options/ Payouts Comp.
Position ($) ($) ($) ($) SARs(#) ($) ($)
- -------------- ---- ------ ----- ------ ---------- ---------- ------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Gregory B.
Lipsker 1997 $0 $0 $0 $0 -0- $0 $0
President 1998 $0 $0 $0 $0 -0- $0 $0
and Director 1999 $0 $0 $0 $0 -0- $0 $0
</TABLE>
(B) DIRECTOR COMPENSATION FOR LAST FISCAL YEAR
<TABLE>
Cash Compensation Security Grants
- ------------------------------------------- ------------------------------------------
Number of
Annual Meeting Consulting Number of Securities
Retainer Fees ($) Fees/Other Shares (#) Underlying
Name Fees ($) Fees ($) Options/SARs(#)
(a) (b) (c) (d) (e) (f)
- ------------------ --------- ------------ ------------ ------------- ---------------
<S> <C> <C> <C> <C> <C>
Gregory Lipsker $-0- -0- -0- 0 0
William R. Green $-0- -0- -0- 0 0
Eunice Campbell $-0- -0- -0- 0 0
</TABLE>
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets out as of the date hereof, the names and shareholdings
of beneficial owners known to the Company to own more than five percent (5%) of
the common stock of the Company, each director and executive officer of the
Company, and the shareholdings of all directors and executive officers as a
group. At such date, the number of issued and outstanding shares of common stock
of the Company was 14,555,668.
DOCUMENT PAGE: 7 OF 20
<PAGE>
<TABLE>
Amount and Nature of
Beneficial Ownership
Name of Person (all direct unless
or Group (1) otherwise noted) % of Class
- ---------------------------------- ------------------------ ----------
<S> <C> <C>
Principal Shareholders:
None
Directors and Executive Officers:
Albert M. Zlotnick 7,277,834 50.00%
301 City Ave.
Bala CynWyd, PA 19004
Greg Lipsker 1,001,500 6.88%
714 Washington Mutual
Financial Center
601 W. Main Avenue
Spokane, WA 99201
William Green 896,000 6.15%
905 W. Riverside, Ste. 311
Spokane, WA 99201
Eunice R. Campbell 595,000 4.09%
301 S. Chestnut, Ste. #6
Spokane, WA 99204
All executive officers and 9,770,334 67.12%
directors as a group (4 persons)
</TABLE>
(1) The positions of those persons who are directors or executive officers
of the Registrant are set out in Item 9.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
(A) TRANSACTIONS WITH MANAGEMENT AND OTHERS
None
(B) CERTAIN BUSINESS RELATIONSHIPS
None
DOCUMENT PAGE: 8 OF 20
<PAGE>
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a). Exhibits required by Item 601 (1)
(3)(i) Articles of Incorporation (2)
(3)(ii) Bylaws. (2)
(13) Annual report to security holders, Form 10Q
or quarterly report to security holders. (2)
(1) Omitted Exhibits not applicable
(2) Incorporated by reference to previous filing
Financial Statements
Independent Auditors' Reports
Balance Sheets at December 31, 1999 and 1998
Statements of Income (Loss)
for the years ended December 31, 1999, and 1998
Statements of Stockholders' Equity
for the years ended December 31, 1997 - 1999
Statements of Cash Flows
for the years ending December 31, 1999, and 1998
Notes to Financial Statements
(b) No reports have been filed on Form 8-K during the last fiscal
quarter covered by this report.
DOCUMENT PAGE: 9 OF 20
<PAGE>
FINANCIAL STATEMENTS AND
INDEPENDENT AUDITORS' REPORT
DECEMBER 31, 1999 AND 1998
METALINE MINING & LEASING COMPANY
-------------------------------------
CONTENTS
Page
INDEPENDENT AUDITORS' REPORT 2
FINANCIAL STATEMENTS:
Balance sheets 3
Statements of income 4
Statements of stockholders' equity 5
Statements of cash flows 6
Notes to financial statements 7-9
DOCUMENT PAGE: 10 OF 20
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors
Metaline Mining & Leasing Company
Spokane, Washington
We have audited the accompanying balance sheets of Metaline Mining & Leasing
Company (a Washington Corporation) as of December 31, 1999 and 1998, and
the related statements of income, stockholders' equity, and cash flows for the
years then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Metaline Mining & Leasing
Company as of December 31, 1999 and 1998, and the results of its operations and
its cash flows for the years then ended, in conformity with generally accepted
accounting principles.
/s/ LeMaster & Daniels PLLC
Spokane, Washington
March 7, 2000
Accountants' page 1
DOCUMENT PAGE: 11 OF 20
<PAGE>
METALINE MINING & LEASING COMPANY
BALANCE SHEETS
<TABLE>
December 31,
--------------------------------
1999 1998
-------------- --------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash $ 404,911 $ 411,866
Temporary cash investments 654,813 627,943
-------------- --------------
Total cash and cash equivalents 1,059,724 1,039,809
INVESTMENTS 13,614 13,718
PARTNERSHIP PROPERTIES 4,122 3,911
-------------- --------------
$ 1,077,460 $ 1,057,438
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 9 $ 306
Federal income tax payable 5,013 12,500
-------------- --------------
Total current liabilities 5,022 12,806
-------------- --------------
STOCKHOLDERS' EQUITY:
Common stock--15,000,000 shares,
no par value, authorized;
14,555,668 shares issued and outstanding 954,282 954,282
Accumulated other comprehensive income:
Unrealized loss, marketable securities (5,877) (5,773)
Retained earnings 124,033 96,123
-------------- --------------
Total stockholders' equity 1,072,438 1,044,632
-------------- --------------
$ 1,077,460 $ 1,057,438
============== ==============
</TABLE>
See accompanying notes to financial statements.
Accountants' page 2
DOCUMENT PAGE: 12 OF 20
<PAGE>
METALINE MINING & LEASING COMPANY
STATEMENTS OF INCOME
- ----------------------
<TABLE>
Years Ended December 31,
---------------------------
1999 1998
------------ ------------
<S> <C> <C>
INCOME:
Dividend and interest income $ 46,848 $ 15,962
------------ ------------
EXPENSES:
Directors' fees - 300
Professional fees 12,691 15,516
Office expense 1,907 336
Taxes, licenses, and fees 528 102
------------ ------------
15,126 16,254
------------ ------------
INCOME (LOSS) BEFORE OTHER INCOME
(EXPENSE) AND INCOME TAX 31,722 (292)
------------ ------------
OTHER INCOME (EXPENSE):
Income (loss) from partnership interests 157 (182)
Gain on sale of investments - 711,377
157 711,195
------------ ------------
INCOME BEFORE FEDERAL INCOME TAX 31,879 710,903
PROVISION FOR FEDERAL INCOME TAX 3,969 170,500
------------ ------------
NET INCOME $ 27,910 $ 540,403
============ ============
BASIC EARNINGS PER SHARE (based on
weighted average shares outstanding) NIL $ 0.07
============ ============
</TABLE>
See accompanying notes to financial statements.
Accountants' page 3
DOCUMENT PAGE: 13 OF 20
<PAGE>
METALINE MINING & LEASING COMPANY
STATEMENTS OF STOCKHOLDERS' EQUITY YEARS ENDED DECEMBER 31, 1999 AND 1998
- ---------------------------------------------------------------------------
<TABLE>
Accumulated
Number of Other Retained
Shares Common Comprehensive Earnings
Outstanding Stock Income (Deficit) Total
----------- ----------- ------------- ----------- -----------
<S> <C> <C> <C> <C> <C>
BALANCES,
DECEMBER 31, 1997 7,277,834 $ 432,483 $ (5,773) $ (444,280) $ (17,570)
ADD (DEDUCT):
COMPREHENSIVE INCOME:
Net income - - - 540,403 540,403
----------- ----------- ------------- ----------- -----------
COMPREHENSIVE INCOME 540,403
-----------
Shares issued
for cash 7,277,834 521,799 - - 521,799
----------- ----------- ------------- ----------- -----------
BALANCES,
DECEMBER 31, 1998 14,555,668 954,282 (5,773) 96,123 1,044,632
ADD (DEDUCT):
COMPREHENSIVE INCOME:
Unrealized loss in
marketable
securities - - (104) - (104)
Net income - - - 27,910 27,910
----------- ----------- ------------- ----------- -----------
COMPREHENSIVE INCOME 27,806
-----------
BALANCES,
DECEMBER 31, 1999 14,555,668 $ 954,282 $ (5,877) $ 124,033 $1,072,438
============ =========== ============== ========== ===========
</TABLE>
See accompanying notes to financial statements.
Accountants' page 4
DOCUMENT PAGE: 14 OF 20
<PAGE>
METALINE MINING & LEASING COMPANY
STATEMENTS OF CASH FLOWS
- ---------------------------
<TABLE>
December 31,
--------------------------------
1999 1998
-------------- --------------
<S> <C> <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 27,910 $ 540,403
Adjustments to reconcile net income to net
cash provided by operating activities:
(Income) loss from partnership interest (211) 132
Increase (decrease) in:
Accounts payable (297) (21,626)
Federal income tax payable (7,487) 12,500
-------------- --------------
Net cash provided by operating activities 19,915 531,409
-------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Deposit received - (9,784)
Purchase of Krugerrands and silver rounds - (13,718)
-------------- --------------
Net cash used in investing activities - (23,502)
-------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock - 521,799
-------------- --------------
NET INCREASE IN CASH AND CASH EQUIVALENTS 19,915 1,029,706
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 1,039,809 10,103
-------------- --------------
CASH AND CASH EQUIVALENTS, END OF YEAR $ 1,059,724 $ 1,039,809
============== ==============
</TABLE>
See accompanying notes to financial statements.
Accountants' page 5
DOCUMENT PAGE: 15 OF 20
<PAGE>
METALINE MINING & LEASING COMPANY
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
- ------------------------------------------------------------------------------
Organization:
The Company was incorporated in the state of Washington in 1927. Although it
has previously been engaged in mineral exploration and continues to hold
interests in mineral exploration properties, the Company currently has no active
business operations. The Company is currently seeking to acquire an interest in
a business opportunity.
Summary of Significant Accounting Policies:
a. Cash and cash equivalents include short-term cash investments that have
an initial maturity of 90 days or less.
b. The Company's marketable securities are stated at estimated fair value at
the balance-sheet dates and unrealized losses are reported in stockholders'
equity as accumulated other comprehensive income. All such securities are
considered to be available-for-sale. Gains and losses are determined using the
specific identification method. Investments in coins (gold Krugerrands and
silver rounds) are stated at cost which approximates fair value.
c. The Company capitalizes acquisition and exploration costs on nonoperating
mining properties and mineral rights for accounting and income tax purposes.
Upon commencement of operations, the capitalized costs will be amortized based
on proven or probable reserves by the unit of production method so that each
unit produced is assigned a pro rata portion of the unamortized acquisition
costs.
d. Capitalized costs are charged to operations as impairment losses when
title to the property has expired or when management believes the properties are
not economically feasible to develop or hold for future development.
e. Income tax is provided for the tax effects of transactions reported in
the financial statements. Deferred income tax assets are recognized for the
estimated future tax benefits of tax-basis operating losses being carried
forward. A valuation allowance for deferred tax assets is also recognized when
appropriate and reversed as such loss carryovers are utilized on the Company's
income tax returns.
f. In 1998 the Company adopted SFAS No. 130, "Reporting Comprehensive
Income," which establishes rules for the reporting of comprehensive income and
its components. Comprehensive income consists of net income (loss) and changes
in unrealized losses on securities available-for-sale. The adoption of SFAS No.
130 had no impact on total stockholders' equity.
g. Basic earnings (loss) per share is computed using the weighted average
number of shares outstanding during the years (14,556,000 in 1999, 8,187,000 in
1998). Diluted income (loss) per share was the same as basic earnings (loss)
per share for the years presented.
h. The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Accountants' page 6
DOCUMENT PAGE: 16 OF 20
<PAGE>
METALINE MINING & LEASING COMPANY
NOTES TO FINANCIAL STATEMENTS
NOTE 2 - INVESTMENTS:
- ------------------------
The Company had the following investments at the balance-sheet dates:
<TABLE>
1999 1998
------------- -------------
<S> <C> <C>
Coins:
Cost and fair value $ 13,614 $ 13,718
------------- -------------
Marketable securities:
Cost 5,773 5,773
Gross unrealized holding loss (5,773) (5,773)
------------- -------------
Totals $ 13,614 $ 13,718
============= =============
</TABLE>
Coins consisted of the following:
- - 44 1-ounce Krugerrands
- - 150 1-ounce silver rounds
Marketable securities consisted of the following investments:
- - 25,000 shares of Capitol Silver Mines, Inc., a development stage company
- - 31,151 shares of Carson Industries Corporation which is currently involved
in oil and gas exploration
- - 1,477,239 shares of Metaline Contact Mines (see below)
The Company's $100,410 original investment in Metaline Contact Mines had been
fully written off as worthless in previous years. In 1998, the shares were sold
for net proceeds of $711,377, resulting in a gain of $711,377.
NOTE 3 - MINING PROPERTIES:
- -------------------------------
Investments in mining properties, net of impairment losses recognized, consisted
of the following:
December 31,
---------------
1999 1998
------ -------
Partnership interest in two units of Pondera Partners, Ltd.,
a drilling project located in Teton County, Montana (at
cost less equity in partnership losses) $4,122 $3,911
DOCUMENT PAGE: 17 OF 20
<PAGE>
METALINE MINING & LEASING COMPANY
NOTES TO FINANCIAL STATEMENTS
NOTE 4 - FEDERAL INCOME TAXES:
- -----------------------------------
The provision for income taxes consisted of the following:
<TABLE>
Years Ended
December 31,
------------------
1999 1998
-------- --------
<S> <C> <C>
Computed expected tax expense $ 3,969 $241,800
Tax benefit of net operating loss carryforward (see below) - (71,300)
-------- --------
$ 3,969 $170,500
======== ========
</TABLE>
At December 31, 1997, the Company had a deferred tax asset of $71,300, relating
to the estimated future tax benefits of current and prior year tax-basis net
operating losses carried forward. The deferred tax asset was fully reserved by
a valuation allowance. In 1998, the Company was able to recognize the full tax
benefits of its carryforward of operating losses and, accordingly, the deferred
tax asset valuation allowance was reversed.
NOTE 5 - CONCENTRATION OF CREDIT RISK:
- --------------------------------------------
The Company maintains its cash and cash equivalents in three financial
institutions. Balances are insured by the Federal Deposit Insurance Corporation
(FDIC) up to $100,000 per institution. Balances on deposit may occasionally
exceed FDIC insured amounts.
DOCUMENT PAGE: 18 OF 20
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
METALINE MINING & LEASING COMPANY .
By: /s/ Gregory B. Lipsker Date: 3/28/2000
- ---------------------------------------- --------------------
GREGORY B. LIPSKER, President
(Principal Executive Officer)
By: /s/ Eunice R. Campbell
- ---------------------------------------- Date: 3/28/2000
EUNICE R. CAMPBELL, Secretary/Treasurer -------------------
(Principal Financial Officer)
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
/s/ Albert M. Zlotnick Date: 3/28/2000
ALBERT M. ZLOTNICK
Director
/s/ William R. Green Date: 3/28/2000
WILLIAM R. GREEN
Director
/s/ Eunice Campbell Date: 3/28/2000
EUNICE CAMPBELL
Director
/s/ Gregory B. Lipsker Date: 3/28/2000
GREGORY B. LIPSKER
Director
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(D) OF THE EXCHANGE ACT BY NON-REPORTING ISSUERS - Not Applicable
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the Balance
Sheets for Metaline Mining & Leasing Company at December 31,1999, the Statements
of Income for the year ended December 31, 1999, and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> DEC-31-1999
<CASH> 1,059,724
<SECURITIES> 13,614
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,073,338
<PP&E> 4,122
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,077,460
<CURRENT-LIABILITIES> 5,022
<BONDS> 0
0
0
<COMMON> 954,282
<OTHER-SE> 118,156
<TOTAL-LIABILITY-AND-EQUITY> 1,077,460
<SALES> 46,848
<TOTAL-REVENUES> 46,848
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> (14,969)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 31,879
<INCOME-TAX> 3,969
<INCOME-CONTINUING> 27,910
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 27,910
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>