<PAGE>
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 quarterly period ended December 31, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
-------------- ---------------
Commission File No. 33-2150-LA
PANTHER RESOURCES LTD.
----------------------
(Name of Small Business Issuer in its Charter)
NEVADA 95-3932052
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(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
#211, 1111 W. Hastings Street
Vancouver, Canada V6E2J3
-------------------------
(Address of Principal Executive Offices)
Issuer's Telephone Number: (604) 689-5377
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Sections 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) has been
subject to such filing requirements for the past 90 days.
(1) Yes X No (2) Yes X No
--- --- --- ---
<PAGE>
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Not applicable.
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the Registrant's classes
of common stock, as of the latest practicable date:
December 31, 1998
42,812,100
----------
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Financial Statements of Panther Resources Ltd., a Nevada
corporation (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, the Financial
Statements fairly present the financial condition of the Company.
<PAGE>
<TABLE>
PANTHER RESOURCES LTD.
(A Development Stage Company)
Consolidated Balance Sheets
<CAPTION>
ASSETS
December 31, March 31,
1998 1998
(Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash $ 7,009 $ -
Prepaid expenses 59,154 25,983
Total Current Assets 66,163 25,983
FURNITURE AND EQUIPMENT, NET 84,863 73,665
OTHER ASSETS
Note receivable 30,000 -
Mineral properties and deferred expenditures 3,405,075 3,024,905
Deposits - 24,717
Total Other Assets 3,435,075 3,049,622
TOTAL ASSETS $ 3,586,101 $3,149,270
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Cash overdraft $ - $ 22,245
Accounts payable 196,067 238,922
Notes payable 740,412 230,700
Management fee payable - 26,371
Total Current Liabilities 936,479 518,238
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock: 10,000,000 shares authorized of
$0.10 par value, 2,000,000 shares issued
and outstanding 200,000 200,000
Common stock: 100,000,000 shares authorized of
$0.001 par value, 42,812,100 and 29,161,100
shares issued and outstanding, respectively 42,812 29,161
Additional paid-in capital 9,210,085 7,266,636
Stock subscription receivable - (254,281)
Currency translation adjustment 168,626 268,031
Deficit accumulated during the development stage (6,971,901) (4,878,515)
Total Stockholders' Equity 2,649,622 2,631,032
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $3,586,101 $ 3,149,270
</TABLE>
<TABLE>
PANTHER RESOURCES LTD.
(A Development Stage Company)
Consolidated Statements of Operations
(Unaudited)
<CAPTION>
From
Inception on
November 10,
For the Nine Months Ended For the Three Months Ended 1995 Through
December 31, December 31, December 31,
1998 1997 1998 1997 1998
<S> <C> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ - $ -
EXPENSES
General and
administrative 2,085,040 1,161,764 707,932 206,401 6,288,046
Depreciation 8,159 9,190 2,854 2,478 17,088
Total Expenses 2,093,199 1,170,954 710,786 208,879 6,305,134
LOSS FROM OPERATIONS(2,093,199)(1,170,954) (710,786) (208,879) (6,305,134)
OTHER INCOME (EXPENSE)
Interest expense (344) - (8) - (344)
Write off of mineral
property - - - - (449,048)
Gain (loss) on foreign
exchange - (1,131) - - -
Bad debt expense - - - - (224,941)
Interest income 157 - 1 - 7,566
Total Other Income
(Expense) (187) (1,131) (7) - (666,767)
NET LOSS $(2,093,386)$(1,172,085) $(710,793)$(208,879) $(6,971,901)
BASIC NET LOSS PER
SHARE OF COMMON STOCK $ (0.04) $ (0.07) $ (0.02) $ (0.01)
</TABLE>
<TABLE>
PANTHER RESOURCES LTD.
(A Development Stage Company)
Consolidated Statements of Stockholders' Equity
<CAPTION>
Additional
Preferred Stock Common Stock Paid-In
Shares Amount Shares Amount Capital
<S> <C> <C> <C> <C> <C>
Balance at
November 10, 1995
(Inception) - $ - - $ - $ -
Common stock issued
for cash at
approximately $0.00
per share - - 2 - -
Currency translation
adjustment - - - - -
Net loss for the
year ended
March 31, 1996 - - - - -
Balance, March 31, 1996 - - 2 - -
Common stock issued
for cash at
approximately $0.38
per share - - 2,884,998 2,885 1,086,602
Common stock issued
for services at
approximately $0.76
per share - - 115,000 115 87,441
Currency translation
adjustment - - - - -
Net loss for the year
ended March 31, 1997 - - - - -
Balance, March 31, 1997 - $ - 3,000,000 $ 3,000 $1,174,043
Recapitalization
(Note 1) - - 12,308,990 12,309 381,753
Common stock issued
for cash at
approximately $0.36
per share - - 6,107,610 6,107 2,816,020
Common stock issued
for services at
approximately $0.36
per share - - 3,366,500 3,367 1,176,259
Issuance of warrants - - - - 17,220
Common stock issued
for debt at
approximately $0.26
per share - - 3,828,000 3,828 991,891
Common stock issued
for mineral properties
at $1.00 per share - - 550,000 550 549,450
Preferred stock issued
for services at
$0.18 per share 2,000,000 200,000 - - 160,000
Currency translation
adjustment - - - - -
Net loss for the
year ended
March 31, 1998 - - - - -
Balance, March 31,
1998 2,000,000 $ 200,000 29,161,100 $ 29,161 $7,266,636
Common stock issued
for services @ $.20
per share
(unaudited) - - 2,447,000 2,447 398,053
Common stock issued
for cash @ $.16
per share
(unaudited) - - 11,054,000 11,084 1,521,616
Common stock issued
for debt @ $.20
per share (unaudited) - - 120,000 120 23,780
Receipt of stock
subscription
receivable (unaudited) - - - - -
Currency translation
adjustment
(unaudited) - - - - -
Net loss for the
nine months Ended
December 31, 1998
(unaudited) - - - - -
Balance,
December 31, 1998
(unaudited) 2,000,000 $ 200,000 42,812,100 $ 42,812 $9,210,085
</TABLE>
<TABLE>
PANTHER RESOURCES LTD.
(Formerly Golden Panther Resources, Ltd.)
(A Development Stage Company)
Consolidated Statements of Stockholders' Equity
<CAPTION>
Deficit
Accumulated
Stock Currency During the
Subscription Translation Development
Receivable Adjustment Stage
<S> <C> <C> <C>
Balance at
November 10, 1995
(Inception) $ - $ - $ -
Common stock issued
for cash at
approximately $0.00
per share - - -
Currency translation
adjustment - (1,230) -
Net loss for the
year ended
March 31, 1996 - - (157,549)
Balance, March 31, 1996 - (1,230) (157,549)
Common stock issued
for cash at
approximately $0.38
per share - - -
Common stock issued
for services at
approximately $0.76
per share - - -
Currency translation
adjustment - 8,542 -
Net loss for the year
ended March 31, 1997 - - (1,388,389)
Balance, March 31, 1997 - $ 7,312 (1,545,938)
Recapitalization
(Note 1) - - -
Common stock issued
for cash at
approximately $0.36
per share (100,000) - -
Common stock issued
for services at
approximately $0.36
per share (154,281) - -
Issuance of warrants - - -
Common stock issued
for debt at
approximately $0.26
per share - - -
Common stock issued
for mineral properties
at $1.00 per share - - -
Preferred stock issued
for services at
$0.18 per share - - -
Currency translation
adjustment - 260,719 -
Net loss for the
year ended
March 31, 1998 - - (3,332,577)
Balance, March 31,
1998 $ (254,281) $ 268,031 $(4,878,515)
Common stock issued for
services @ $.20 per share
(unaudited) - - -
Common stock issued for
cash @ $.16 per share
(unaudited) - - -
Common stock issued for debt
@ $.20 per share (unaudited) - - -
Receipt of stock subscription
receivable (unaudited) 254,281 - -
Currency translation adjustment
(unaudited) - (99,405) -
Net loss for the nine months Ended
December 31, 1998 (unaudited) - - (2,093,386)
Balance, December 31, 1998
(unaudited) $ - $ 168,626 $(6,971,901)
</TABLE>
<TABLE>
PANTHER RESOURCES LTD.
(A Development Stage Company)
Consolidated Statements of Cash Flows
(Unaudited)
<CAPTION>
From
Inception on
November 10,
For the Nine Months Ended For the Three Months Ended 1995 Through
December 31, December 31, December 31,
1998 1997 1998 1997 1998
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss $(2,093,386)$(1,172,085)$(710,793)$(208,879) $(6,971,901)
Adjustments to
reconcile net
loss to net cash
used by operating
activities:
Depreciation expense 8,159 9,190 2,854 2,478 17,088
Stock issued for
services 400,500 470,000 64,000 - 1,873,399
Bad debt expense - - - - 224,941
Write-off mineral
property - - - - 449,048
Issuance of warrants - - - - 17,220
Currency translation - 15,055 - - -
Changes in operating
assets and liabilities:
(Increase) decrease
in accounts
receivable (25,000) 32,799 - 3,738 (238,312)
(Increase) decrease
in deposits and
prepaid expenses (8,455) 77,511 21,713 29,035 (137,478)
Increase (decrease)
in cash overdraft -
Increase (decrease)
in accounts payable (70,099) 37,799 (179,143) 20,089 175,771
Increase (decrease)
in management fee
payable (26,371) - - - -
Net Cash (Used)
by Operating
Activities (1,814,652) (529,731) (801,369) (153,539) (4,590,224)
CASH FLOWS FROM INVESTING
ACTIVITIES
Sale of fixed assets - - - - 2,932
Purchase of fixed
assets (14,019) (4,878) - (7,810) (165,965)
Purchase of mineral
property and deferred
exploration costs (380,170) (1,550,162) (48,801)(1,514,835) (2,616,370)
Net Cash (Used)
by Investing
Activities (394,189) (1,555,040) (48,801)(1,522,645) (2,779,403)
CASH FLOWS FROM FINANCING
ACTIVITIES
Payments on notes
payable (428,381) (539,510) - (28,444) (428,381)
Proceeds from
common stock 1,786,981 1,829,338 393,100 1,495,338 5,598,595
Proceeds on notes
payable 857,250 827,752 457,377 188,633 2,206,422
Net Cash Provided
by Financing
Activities 2,215,850 2,117,580 850,477 1,655,527 7,376,636
NET INCREASE
(DECREASE) IN CASH 7,009 32,809 307 (20,657) 7,009
CASH AT BEGINNING
OF PERIOD - - 6,702 53,466 -
CASH AT END OF PERIOD $ 7,009 $ 32,809 $ 7,009 $ 32,809 $ 7,009
CASH PAID FOR:
Interest $ - $ - $ - $ - $ -
Income taxes $ - $ - $ - $ - $ -
NON-CASH FINANCING ACTIVITIES
Common stock issued
for acquisition $ - $ - $ - $ - $ 394,062
Common stock issued
for debt conversion $ 23,900 $ 834,000 $23,900 $500,000 $1,019,619
Common stock issued
for mineral
properties $ - $ 375,000 $ - $375,000 $ 550,000
Common stock issued
for services $400,500 $ 470,000 $64,000 $ - $1,873,399
</TABLE>
PANTHER RESOURCES LTD.
(A Development Stage Company)
Notes to the Consolidated Financial Statements
December 31, 1998 and 1997
NOTE 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements have been
prepared by the Company without audit. In the opinion of management, all
adjustments (which include only normal recurring adjustments) necessary to
present fairly the financial position, results of operations and cash flows at
December 31, 1998 and for all periods presented have been made.
Certain information and footnote disclosures normally included in
consolidated financial statements prepared in accordance with general accepted
accounting principles have been condensed or omitted. It is suggested that
these condensed consolidated financial statements be read in conjunction with
the financial statements and notes thereto included in the Company's March 31,
1998 audited consolidated financial statements. The results of operations for
the periods ended December 31, 1998 and 1997 are not necessarily indicative of
the operating results for the full year.
<PAGE>
Item 2. Management's Discussion and Analysis or Plan of Operation.
- --------------------------------------------------------------------
Plan of Operation.
- ------------------
The Company's plan of operation for the next 12 months is
to perform exploration on the La Verde property, located in the State of
Sinaloa, Mexico, as discussed in the Company's Annual Report on Form 10-KSB
for the fiscal year ended March 31, 1998, which was filed with the Securities
and Exchange Commission on July 9, 1998, and which is incorporated herein by
reference.
During the next 12 months, subject to the receipt of sufficient
funding, the Company intends to expend approximately $3,000,000 to conduct
exploration and development of the La Verde properties and, depending on the
results of such exploration and the Company's ability to finance such
operations, to develop the mineral reserves located thereon. Depending on the
availability of funding, the Company also intends to explore for potential
minable reserves on a limited number of other properties located near the La
Verde property.
If sufficient funding is received, management expects that the
Company's exploration activities will be comprised of drifting to delineate
ore reserves, further exploration of other identified targets which would
include induced polarization, drilling and such other exploration activities
as are needed to define the known resource. The La Verde property has been
actively mined for the past 12 years and is currently processing approximately
200 tons of ore per day. The exploration that the Company intends to conduct
will be aimed at determining the size and location of the multiple ore bodies
on the La Verde property.
Because of its presently limited cash on hand, the Company expects
that its proposed operations for the next 12 months will have to be funded
through private placements of "unregistered" and "restricted" shares of its
common stock; alternatively, the Company may seek a joint venture partner to
pay for exploration expenses. There can be no assurance that the Company will
be able to obtain sufficient funding to conduct its proposed activities or
that, if such funding is obtained, its exploration activities will reveal
mineral deposits in sufficient amounts to warrant further mining. See the
heading "Liquidity" of this caption.
Results of Operations.
- ----------------------
During the quarterly period ended December 31, 1998, the Company
received no revenues and incurred expenses totaling $710,786. Net loss during
the period was $710,786, equaling $0.02 per share.
Liquidity.
- ----------
As of December 31, 1998, the Company had total assets of
$3,586,101, of which $7,009 consisted of cash and cash equivalents. The
Company's proposed exploration activities during the next 12 months will
require the expenditure of an estimated $3,000,000. The Purchase Agreement
between the Company and Minera Humaya S.A. de C.V, which owns the La Verde
Property, provides for the Company to receive approximately 50% of the profits
produced by the La Verde property. However, no assurance can be given that
the Company's share of the La Verde property profits, if any, will be
sufficient to fund its planned operations during the next 12 months. In such
an event, management intends to raise such additional funding as is necessary
through the private placement of "unregistered" and "restricted" shares of its
common stock. However, there can be no assurance that the Company will be
able to successfully raise such funding.
Year 2000.
- ----------
The Company's proposed mining exploration activities are not dependent on
computers that may subject to Year 2000 problems. The Company is presently
seeking additional funding to continue with its proposed exploration
activities and is not currently conducting any material operations, pending
receipt of such funding. At such time as the Company recommences its mining
exploration activities, management has determined that Year 2000 issues will
not materially affect them, because these activities will be limited to
drilling, induced polarization and other activities that are not dependent on
computers that may be subject to Year 2000 issues.
The Company can give no assurance that third parties with whom it does
business (e.g., banks and utilities) will ensure Year 2000 compliance in a
timely manner or that, if they do not, their computer systems will not have an
adverse effect on the Company. However, the Company does not believe that
Year 2000 compliance issues of such third parties will result in a material
adverse effect on its financial condition or results of operations.
For the foregoing reasons, the Company has determined that the potential
consequences of the Year 2000 would not have a present material effect on its
business, results of operations or financial condition.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
- ----------------------------
None; not applicable.
Item 2. Changes in Securities.
- --------------------------------
None; not applicable.
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.
- -------------------------------------------
(a) Exhibits.
27 Financial Data Schedule.
(b) Reports on Form 8-K.
None.
<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.
PANTHER RESOURCES LTD.
Date: 2/12/99 By/s/Gordon J. Muir
-------------- -------------------------------------
Gordon J. Muir
CEO and Chairman of the Board
Date: 2/12/99 By/s/Penny Perfect
-------------- -------------------------------------
Penny Perfect
President and Director
Date: 2/12/99 By/s/Katherine Johnston
-------------- -------------------------------------
Katharine Johnston
Vice President and Director
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-END> DEC-31-1998
<CASH> 7009
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<RECEIVABLES> 30000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 66163
<PP&E> 3481779
<DEPRECIATION> 8159
<TOTAL-ASSETS> 3586101
<CURRENT-LIABILITIES> 936479
<BONDS> 0
0
200000
<COMMON> 42812
<OTHER-SE> 2406810
<TOTAL-LIABILITY-AND-EQUITY> 3586101
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2093199
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 344
<INCOME-PRETAX> (2093386)
<INCOME-TAX> 0
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<NET-INCOME> (2093386)
<EPS-PRIMARY> (0.04)
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</TABLE>
