UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1997
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 0-25658
Kalan Gold Corporation
----------------------
(Exact name of registrant as specified in its charter)
Colorado 84-1357927
-------- ----------
(State or other jurisdiction of (I.R.S. Identification No.)
Employer incorporation or organization)
Tower I, Suite 340, 12835 E. Arapahoe Road Englewood, Colorado 80112
(Address of principal executive offices)
(303) 706-1606
---------------------------------------------------------------------
(Registrant's telephone number, including area code)
(Former name, former address and former
fiscal year if changed since last year)
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. Yes X No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date.
7,090,000 common shares outstanding as of August 11, 1997
---------------------------------------------------------
The document is comprised of 9 pages.
<PAGE>
Kalan Gold Corporation
(a Development Stage Enterprise)
Index
Part I Page
Item 1. Financial Information
Condensed balance sheet as of
June 30, 1997 .............................. 2
Condensed statements of operations,
three and six months ended June 30, 1997
and 1996 and January 1, 1993 through
June 30, 1997 .............................. 3
Condensed statements of cash flows,
six months ended June 30, 1997 and
1996 and January 1, 1993 through
June 30, 1997 .............................. 4
Notes to condensed financial
statements ................................. 5
Item 2. Plan of operation ............................ 7
Part II
Other information ............................ 8
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote
of Security Holders
Item 5. Other information
Item 6. Exhibits and Reports on Form 8-K
Signatures ................................... 9
-1-
<PAGE>
Part I. Item 1. Financial information
Kalan Gold Corporation
----------------------
(a Development Stage Enterprise)
Condensed Balance Sheet
June 30, 1997
ASSETS
Cash .................................................. $ 218
Furniture and equipment ............................... 5,446
Accumulated depreciation .............................. (844)
Deposit ............................................... 1,362
Mining concession acquisition costs ................... 59,904
-----------
$ 66,086
===========
LIABILITIES AND SHAREHOLDERS' DEFICIT
LIABILITIES
Accounts payable and accrued expenses ............... $ 124
Advance from affiliate .............................. 36,026
Current portion of long-term debt ................... 50,712
Long-term notes payable ............................. 23,898
-----------
TOTAL LIABILITIES 110,760
-----------
SHAREHOLDERS' DEFICIT
Common stock ........................................ 71
Additional paid in capital ................. ........ 26,385
Deficit accumulated during development .............. (71,130)
-----------
TOTAL SHAREHOLDERS' DEFICIT (44,674)
-----------
$ 66,086
===========
See accompanying notes to condensed financial statements.
-2-
<PAGE>
KALAN GOLD CORPORATION
----------------------
(a Development Stage Enterprise)
Condensed Statements of Operations
<TABLE>
<CAPTION>
January 1,
1993
Three months ended Six months ended (Inception)
June 30, June 30, through
---------------------- ------------------------- June 30,
1997 1996 1997 1996 1997
---------- ---------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C>
COSTS AND EXPENSES
General and administrative ..................... $ 41,008 $ 5,277 $ 95,532 $ 5,305 $ 151,492
Depreciation ................................... 126 - 580 - 844
----------- ----------- ----------- ------------ ------------
OPERATING LOSS (41,134) (5,277) (96,112) (5,305) (152,336)
NONOPERATING INCOME
Gain on sale of properties ..................... - - 86,041 - 86,041
INTEREST EXPENSE ................................ (1,674) - (2,417) - (4,835)
----------- ----------- ----------- ------------ ------------
NET LOSS $ (42,808) $ (5,277) $ (12,488) $ (5,305) $ (71,130)
=========== =========== =========== ============ ============
Weighted average shares outstanding ............. 7,065,000 2,052,500 7,058,750 2,052,500 2,368,009
=========== =========== =========== ============ ============
Net (loss) per share ............................ $ * $ * $ * $ * $ (0.03)
=========== =========== =========== ============ ============
*Less than $.01
</TABLE>
See accompanying notes to condensed financial statements.
-3-
<PAGE>
KALAN GOLD CORPORATION
(a Development Stage Enterprise)
Condensed Statements of Cash Flows
January 1,
1993
Six Months Ended (inception)
June 30, Through
------------------------ June 30,
1997 1996 1997
----------- ----------- -----------
NET CASH (USED IN)
OPERATING ACTIVITIES (98,760) (3,655) (152,291)
----------- ----------- -----------
INVESTING ACTIVITIES:
Purchase of equipment ....... - - (5,446)
Sale of interest in mining
concessions ............... 145,945 - 145,945
----------- ----------- -----------
NET CASH PROVIDED BY
INVESTING ACTIVITIES 145,945 - 140,499
----------- ----------- -----------
FINANCING ACTIVITIES:
Proceeds from advances from
affiliate ................. - - 90,971
Repayment of affiliate
advance ................... (54,945) - (54,945)
Payments of long-term debt .. - - (30,000)
Capital contribution ........ 750 3,377 4,450
----------- ----------- -----------
NET CASH PROVIDED BY (USED IN)
FINANCING ACTIVITIES (54,195) 3,377 10,476
----------- ----------- -----------
NET (DECREASE) IN CASH
AND CASH EQUIVALENTS......... (7,010) (278) (1,316)
Cash and cash equivalents,
beginning of year ........... 7,228 647 1,534
----------- ----------- -----------
CASH AND CASH EQUIVALENTS,
END OF YEAR ................. $ 218 $ 369 $ 218
=========== =========== ===========
SUPPLEMENTARY DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for:
Interest .................. $ - $ - $ -
Income taxes .............. $ - $ - $ -
NONCASH INVESTING AND FINANCING TRANSACTIONS:
Common stock issued for
services .................. $ - $ - $ 15
See accompanying notes to condensed financial statements.
-4-
<PAGE>
KALAN GOLD CORPORATION
(a Development Stage Enterprise)
Notes to Condensed Financial Statements
June 30, 1997
Note A: Basis of presentation
The financial statements presented herein have been prepared by the
Company in accordance with the accounting policies in its annual 10-KSB
report dated December 31, 1996 and should be read in conjunction with
the notes thereto.
In the opinion of management, all adjustments (consisting only of normal
recurring adjustments) which are necessary to provide a fair
presentation of operating results for the interim periods presented have
been made.
Interim financial data presented herein are unaudited.
Note B: Related party transactions
During the three months ended June 30, 1997, an affiliate of the Company
made short-term cash advances to the Company for working capital
purposes. The Company repaid $107,445 of these advances with the
proceeds from the sale of certain mining concessions.
Note C: Gain on sale of properties
On February 18, 1997, the Company entered into an agreement with Trio
Gold Corporation, an Alberta private corporation (Trio), whereby Trio
purchased a fifty percent ownership interest in the Ahanta and Esikaman
mining concessions. Proceeds from the sale were approximately $145,945.
Trio also agreed to expend approximately $384,000 on certain exploration
and geochemical work performed, by an affiliate of the Company, and
future exploration and geochemical work to be performed by Trio, related
to the two properties.
Note D: Shareholders' deficit
On November 14, 1996, the Company reserved 237,500 shares of common
stock for issuance under a non-compensatory stock option plan. The
options allow the officers of the Company to purchase 37,500, 75,000 and
125,000 shares of common stock at $.02 per share. The officers were
vested and the options were exercisable as of the grant date.
-5-
<PAGE>
KALAN GOLD CORPORATION
(a Development Stage Enterprise)
Notes to Condensed Financial Statements
June 30, 1997
Note D: Shareholders' deficit, continued
On May 27, 1997, an officer paid $750 to exercise his option for 37,500
shares of the Company's common stock, leaving 200,000 shares of the
stock option plan outstanding and exercisable at June 30, 1997. The
remaining stock options expire on November 14, 2001.
Note E: Income taxes
The Company records its income taxes in accordance with Statement of
Financial Accounting Standard No. 109, "Accounting for Income Taxes".
Continuing net operating losses during the quarter ended June 30, 1997
were offset by an increase to the valuation allowance of $12,842.
-6-
<PAGE>
KALAN GOLD CORPORATION
(a Development Stage Enterprise)
Part I. Item 2. Plan of operation
The plan of the Company's management, for the next twelve months, is that the
Company will focus on the gold mining business, initially solely with respect to
the two mining concessions acquired in 1996. The Company's management plans to
develop operations in conjunction with their joint venture partner, Trio Gold
Corporation. The Company plans to continue to acquire loans from an affiliate to
finance its development stage operations. Trio is the designated operator of the
gold properties. Trio is continuing their geochemistry program in preparation
for core drilling. At June 30, 1997 the Company had three employees and does not
anticipate materially increasing the number of employees in the next twelve
months.
Financial condition
The sale of certain mining concessions as discussed in Note C to the financial
statements, provided the Company with cash to repay working capital advances
received from an affiliate and also provided liquidity for operations. There
have been no other material changes to the Company's financial condition during
the quarter to which this Quarterly Report is filed.
Results of operations
No income producing operations were conducted during the most recent quarter.
Expenses, since year end and in the current quarter, consisted of rent and
office expenses, salaries, travel, postage, filing fees, legal and accounting
fees, transfer agent costs, interest and depreciation.
-7-
<PAGE>
KALAN GOLD CORPORATION
(a Development Stage Enterprise)
Part II. Other Information
Item 1. Legal Proceedings
not applicable
Item 2. Changes In Securities
not applicable
Item 3. Defaults Upon Senior Securities
not applicable
Item 4. Submission Of Matters To A Vote Of Security Holders
not applicable
Item 5. Other Information
not applicable
Item 6. Exhibits and Reports On Form 8-K
a) Exhibits
not applicable
b) Reports On Form 8-K were filed on:
not applicable
-8-
<PAGE>
KALAN GOLD CORPORATION
(a Development Stage Enterprise)
SIGNATURES
The financial information furnished herein has not been audited by an
independent accountant; however, in the opinion of management, all adjustments
(only consisting of normal recurring accruals) necessary for a fair presentation
of the results of operations for the three months ended June 30, 1997 have been
included.
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.
Kalan Gold Corporation
(Registrant)
Date: August 14, 1997 /s/James M. Baum
......................
James M. Baum
President
-9-
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000940516
<NAME> Kalan Gold Corporation
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1.000
<CASH> 218
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 218
<PP&E> 5,446
<DEPRECIATION> (844)
<TOTAL-ASSETS> 66,086
<CURRENT-LIABILITIES> 124
<BONDS> 0
0
0
<COMMON> 71
<OTHER-SE> 26,385
<TOTAL-LIABILITY-AND-EQUITY> 66,086
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> (41,124)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (1,674)
<INCOME-PRETAX> (42,808)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (42,808)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
