Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of issuer's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10 - K. x
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). ¨ Yes x No
The
issuer's revenues for its most recent fiscal
year: $0.00
As of
August 10, 2009, there were 54,041,286 shares of the common stock issued and
outstanding. The aggregate market value of the common equity held by
non-affiliates (based on the average bid and ask price of the common stock) as
of August 10, 2009 was $ 378,289 (USD).
Transitional
Small Business Disclosure Format (Check one) ¨ Yes x No.
M45
Mining Resources, Inc.
Table
of Contents
|
PART
I
|
||
|
Item
1.
|
Description
of Business.
|
|
|
Item
1A.
|
Risk
Factors.
|
|
|
Item
1B.
|
Unresolved
Staff Comments.
|
|
|
Item
2.
|
Properties.
|
|
|
Item
3.
|
Legal
Proceedings.
|
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders.
|
|
| PART II | ||
|
Item
5.
|
Market
Price for the Registrant's Common Equity, Related Stockholders Matters and
Issuer Purchases of Equity Securities.
|
|
|
Item
6.
|
Selected
Financial Data.
|
|
|
Item
7.
|
Management's
Discussion and Analysis of Financial Condition and Results of
Operations.
|
|
|
Item
7A.
|
Quantitative
and Qualitative Disclosures About Market Risk.
|
|
|
Item
8.
|
Financial
Statements and Supplementary Data.
|
|
|
Item
9.
|
Changes
in and Disagreements With Accountants on Accounting and Financial
Disclosures.
|
|
|
Item
9B.
|
Other
Information.
|
|
|
PART
III
|
||
|
Item
10.
|
Directors
and Executive Officers, Promoters and Control Persons.
|
|
|
Item
11.
|
Executive
Compensation
|
|
|
Item
12.
|
Security
Ownership of Certain Beneficial Owners and Management.
|
|
|
Item
13.
|
Certain
Relationships and Related Transactions, and Director
Independence.
|
|
|
Item
14.
|
Principal
Accounting Fees and Services.
|
|
|
PART
IV
|
||
|
Item
15.
|
Exhibits
and Financial Statement Schedules.
|
|
|
Signatures
|
||
PART
I
Item
1. Description of Business.
Forward
Looking Statements
Information
in this Form 10-K contains forward looking statements" within the meaning of
Rule 175 of the securities Act of 1933, as amended, and Rule 3b-6 of the
Securities Act of 1934, as amended. When used in this Form 10-K, the words
expects," "anticipates," "believes," "plans," "will" and similar expressions are
intended to identify forward-looking statements. These are statements that
relate to future periods and include, but are not limited to, statements
regarding our adequacy of cash, expectations regarding net losses and cash flow,
statements regarding our growth, our need for future financing, our dependence
on personnel, and our operating expenses.
Forward-looking
statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from those projected. These forward-looking
statements speak only as of the date hereof. The Company expressly disclaims any
obligation or undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change in its
expectations with regard thereto or any change in events, conditions or
circumstances on which any such statement is based.
Business
Development
M45
Mining Resources Inc., sometimes referred to herein as "we," "us,” “our," and
the "Company" and/or "M45" was incorporated on July 26, 1990, under the laws of
the State of Nevada, to engage in any lawful corporate undertaking, including,
but not limited to, selected mergers and acquisitions which would provide an
eventual profit for the Company.
In
November 1995, the Company, in consideration of the issuance of 150,000
authorized but unissued shares, received $75,000 (USD) from Capital General
Corporation. The sales price $0.50 (USD) per share was arbitrarily decided upon
by both parties. After the completion of the stock purchase, Capital General
became the holder of approximately 49.6% of the outstanding shares of the
Company.
The
Company had been in the development stage from inception until December 1998,
and its operations had been limited to the aforementioned sale of shares to
Capital General Corporation and the gift of shares to the minority shareholders.
During this period, the Company had continued to search for potential business
opportunities, which might have involved the acquisition, consolidation or
reorganization of an existing business.
On
January 8, 1999, the board of directors of M45 entered into an Agreement with
Softguard Enterprises Inc. ("Softguard"), a private Canadian corporation,
whereby the Company issued and delivered, 7,650,000 shares, of its common stock
bearing a restrictive legend, in exchange for which issuance, M45 acquired all
of the outstanding shares of Softguard. The transaction was exempt from the
registration requirements of the Securities Act of 1933 by virtue of Section
4(2) thereof. Following the transaction the former shareholders of Softguard
owned 82% of the outstanding shares of the Company.
On
December 31, 2002, the board of directors of M45 unanimously agreed to abandon
its wholly owned subsidiary, Softguard Enterprises Inc., due to lack of
operations. They determined that Softguard's original business plan could not be
executed and developed due to lack of operating capital and failure to complete
the product design and development of the computer software
technology.
On
September 1, 2005, M45 consummated the transaction contemplated by the Share
Exchange Agreement between M45, Roadvision and the Roadvision Selling
Shareholders, pursuant to which the parties agreed that M45 would acquire all of
the issued and outstanding shares of Roadvision in exchange for the issuance in
the aggregate of 7,250,000 of M45's shares of common stock to Roadvision Selling
Shareholders. The issuance of M45's shares of common stock to Roadvision Selling
Shareholders was exempt from registration under the Securities Act of 1933, as
amended, pursuant to Section 4(2) thereof and to provisions of Regulation
S.
Roadvision
became a wholly-owned subsidiary of M45 and, upon the issuance of shares, the
Roadvision Selling Shareholders owned approximately 42% of all of M45's issued
and outstanding stock. M45 currently has a total of 37,241,530 shares of common
stock issued and outstanding.
On
January 17, 2007, the Registrant entered into an agreement with Exploration
Miniere Grenville Inc. (“EMG”), a Quebec corporation, whereby EMG sold to the
Registrant a total of TWO HUNDRED AND NINETY-TWO (292) mining claims located in
the Matagami Mining Camp, Province of Quebec in or around designated territory
32F for the purchase price of NINE HUNDRED NINE THOUSAND AND NINETY (909,090)
shares of common stock of the Registrant. The agreement stipulates that
following completed drilling and positive results the Company will pay the sum
of $ 2,000,000 to (“EMG”).
On
January 17, 2007, in connection with the EMG transaction, the Company filed with
the State of Nevada an Amendment to its Certificate of Incorporation to change
its name to M45 Mining Resources, Inc.
Business
of Issuer
M45
Mining Resources Inc.’s (MRES: OB), strategic focus is on building shareholder
value through the exploration and development of mineral claims, particularly in
the Matagami Mining Camp located in Quebec, Canada. The Matagami Mining Camp is
known for its zinc-rich massive sulphide deposits. Initial exploratory work in
the Camp can be traced back to the 1930's with Noranda's activities in the
region. Ten of the eighteen deposits discovered to date have been mined and have
produced a total of 3.9 Mt zinc and 0.4 Mt copper.
We
believed that there were likely one or more deposits situated within the limits
of the Claims due to the fact that the property is located near past producers
and existing deposits. We commenced the first phase exploration program in early
April 2007, and conducted a full survey of NI-43-101, to determine the location
of potential deposits. On June 7 2007, the company received final results of the
NI-43-101 reports confirming the presence of deposits. The Company intends to
initiate a massive drilling program as per the geologist’s recommendation, which
is contained in the report. The drilling program cost will represent a total of
approximately $2.8 million Canadian dollars.
As of
August 10, 2009, the Company has no full-time employees. The President and
Secretary-Treasurer have agreed to allocate a portion of their time without
compensation to the activities of the Company.
The
Company reported no revenues for the fiscal years ended March 31, 2009 and
2008. On April 1, 2007, the Company entered into an arrangement with
its principal shareholder to pay rent and common shared expenses at set price of
$3,500 per month and covers such expenses as rent, telephone costs, utilities
and other similar operational support costs. On April 7, 2008 and September 12,
2008, the principal shareholder converted the outstanding note balance due him
from the Company for advances he had previously made to the Company for payment
of general operational support expenses. He received a total of 8,164,356 shares
and 4,989,440 shares respectively of common stock. Subsequent to receipt of
these shares as full payment of the note payable due him, the principal
shareholder advanced the Company an additional $146,422 for the payment of the
same type of operational support expenses. The principal shareholder
has agreed to continue to provide financial support for the payment of general
operational support expenses until such time the Company begins to generate
revenues.
The
Company expects to encounter intense competition in its efforts to become a
leader in mining exploration. Many large and small companies compete in this
intense market. The principal means of competition vary among categories and
business groups; however, the value of the territories is certainly to be taken
in consideration. The competing entities will have significantly greater
experience, financial resources, facilities, contacts and managerial expertise,
than the Company.
Reports
to Security Holders
M45 is a
reporting company under Section 15(d) of the Securities Exchange Act of 1934, as
amended, that electronically files periodic and episodic reports including
quarterly reports on Form 10-QSB, annual reports on Form 10-K, and other reports
and information with the Securities and Exchange Commission ("SEC"). The SEC
maintains an Internet site (http://www.sec.gov) that contains these reports, and
all other information regarding issuers.
ITEM
1A. Risk Factors.
We are a
smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are
not required to provide the information under this item.
ITEM
1B. Unresolved Staff Comments.
None
ITEM
2. Description of Property.
The
Company occupies office space supplied by is principal shareholder; the fixed
monthly arrangement with its principal shareholder (referred to above: “Business
of Issuer”) includes an allowance for space rental. The occupied space is
located at: 1212 Redpath Crescent, Montreal, Quebec, Canada.
At the
present time, the Company does not have any intentions of investing in any real
estate property; real estate mortgages, real estate backed securities, or have
any agreements with persons primarily engaged in real estate
activities.
During
the fiscal year ended March 31, 2009, the Company did not own, intend to own, or
lease any other property.
ITEM
3. Legal Proceedings.
As of the
date hereof, there are no legal proceedings pending or threaten by or against
the Company. Nor are any of its directors, officers or affiliates in a party
adverse to the Company in any legal proceedings.
ITEM
4. Submission of Matters to a Vote of Security Holders.
No
matters were submitted to a vote of security holders of the Company during the
fourth quarter of the fiscal year ended March 31, 2009.
PART
II
ITEM
5. Market Price for the Registrant’s Common Equity, Related
Stockholder Matters and Issuer Purchases of Equity Securities.
Market
Information
The
Company has authorized capital stock of 55,000,000 shares of common stock with a
par value of $.001, of which 54,041,286 shares were issued and outstanding as of
August 10, 2009. The Company's common stock commenced trading on January 27,
1999 on the OTC Bulletin Board (OTCBB) operated by the National Association of
Securities Dealers, Inc., under the symbol "MRES".
The table
below sets forth the reported and summarized high and low bid prices of the
common stock for each quarter shown, as provided by the NASD Trading and Market
Services.
Market
Information (Continued)
The
quotations reflect inter-dealer prices, without adjustment for retail markups,
markdowns or commissions and may not represent actual transactions in our
securities.
|
Quarterly
Common Stock Bid Price Range
|
High
|
Low
|
||||||
|
March
31, 2009
|
0.0150 | 0.0005 | ||||||
|
December
31, 2008
|
0.0350 | 0.0100 | ||||||
|
September
30, 2008
|
0.0910 | 0.0090 | ||||||
|
June
30, 2008
|
0.1000 | 0.0100 | ||||||
|
Fiscal
Year Ended on March 31, 2008
|
||||||||
|
Per
Share Common Stock Bid Prices by Quarter
|
High
|
Low
|
||||||
|
March
31, 2008
|
0.10 | 0.10 | ||||||
|
December
31, 2007
|
0.13 | 0.13 | ||||||
| 0.14 | 0.14 | |||||||
|
June
30, 2007
|
0.26 | 0.26 | ||||||
Holders
As of
June 30, 2009, there were approximately 540 holders of record of the Company's
common stock. The number of registered shareholders excludes any estimate of the
number of beneficial owners of common shares held in street name.
Section
15(g) of the Securities Exchange Act of 1934
Our
shares are covered by section 15(g) of the Securities Exchange Act of 1934, as
amended that imposes additional sales practice requirements on broker/dealers
who sell such securities to persons other than established customers and
accredited investors (generally institutions with assets in excess of $5,000,000
or individuals with net worth in excess of $1,000,000 or annual income exceeding
$200,000 or $300,000 jointly with their spouses). For transactions covered by
the Rule, the broker/dealer must make a special suitability determination for
the purchase and have received the purchaser's written agreement to the
transaction prior to the sale. Consequently, the Rule may affect the ability of
broker/dealers to sell our securities and also may affect your ability to sell
your shares in the secondary market.
Section
15(g) also imposes additional sales practice requirements on broker/dealers who
sell penny securities. These rules require a one page summary of certain
essential items. The items include the risk of investing in penny stocks in both
public offerings and secondary marketing; terms important to in understanding of
the function of the penny stock market, such as id and offer quotes,
a dealers spread and broker/dealer compensation; the broker/dealer compensation,
the broker/dealers’ duties to its customers, including the disclosures required
by any other penny stock disclosure rules; the customers’ rights and remedies in
cases of fraud in penny stock transactions; and, the FINRA’s toll free telephone
number and the central number of the North American Administrators Association,
for information on the disciplinary history of broker/dealers and their
associated persons.
Dividends
The
Company has not declared or paid a cash dividend to stockholders since it was
organized and does not intend to pay dividends in the foreseeable future. The
board of directors presently intends to retain any earnings to finance our
operations and does not expect to authorize cash dividends in the foreseeable
future. Any payment of cash dividends in the future will depend upon the
Company's earnings, capital requirements and other factors.
Securities
Authorized for Issuance under Equity Compensation Plans
On April
6, 2007, the Company filed a Registration Statement on Form S-8, wherein the
Company registered a total of 7,000,000 shares of common stock pursuant to an
Employee Stock Option Plan, adopted March 26, 2007, whereby certain employees of
the Company were granted the right to purchase shares of common stock of the
Company at not less than 85% of the Fair Market Value of the Shares on the date
of grant; provided that: (a) the Exercise Price of an ISO will be not less than
100% of the Fair Market Value of the Shares on the date of grant; and (b) the
Exercise Price of any ISO granted to a Ten Percent Stockholder will not be less
than 110% of the Fair Market Value of the Shares on the date of grant. Payment
for the Shares purchased may be made in accordance with Section 9 of this Plan.
Pursuant to the S-8 filing, certain consultants were also issued shares of
common stock.
Recent
Sale of Unregistered Securities
The
Company did not sell any securities without registration under the Securities
Act of 1933 or in a transaction exempt from registration that was not previously
reported on a Form 10-Q, Form 10-QSB, or in a Form 8-K during the fiscal years
ended March 31, 2009 and 2008.
During
the forth quarter of the fiscal year covered by this report, the Company did not
have any plans or programs to repurchase any of its common stock or any other
units of any class of equity security. There are no warrants or options
outstanding to acquire any additional common stock of the Company.
Item
6. Selected Financial Data.
We are a
smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are
not required to provide the information under this item.
Item
7. Management's Discussion and Analysis of Financial
Condition.
Introduction
The
following discussion of our financial condition and results of our operations
should be read in conjunction with the Financial Statements and Notes thereto.
Our fiscal year ends March 31. This document contains certain forward-looking
statements including, among others, anticipated trends in our financial
condition and results of operations and our business strategy. These
forward-looking statements are based largely on our current expectations and are
subject to a number of risks and uncertainties. Actual results could differ
materially from these forward-looking statements. Important factors to consider
in evaluating such forward-looking statements include: i) changes in external
factors or in our internal budgeting process which might impact trends in our
results of operations; ii) unanticipated working capital or other cash
requirements; iii) changes in our business strategy or an inability to execute
our strategy due to unanticipated changes in the industries in which we operate;
and iv) various competitive market factors that may prevent us from competing
successfully in the marketplace.
Plan
of Operation
Since its
inception, the Company has suffered recurring losses from operations and has
been dependent on existing stockholders and new investors to provide cash
resources to sustain its operations. M45 is a development stage enterprise with
limited operational history. We currently have no cash reserves and anticipate
that our available funds and resources will not be sufficient to satisfy our
needs for working capital and capital expenditures for the next twelve months.
The Company will be unable to pursue continued research and Territory
development and the transition to a company engaged in both research and
commercialization of its products will depend upon our ability to raise
additional funds through equity or debt financing, in which case our current
stockholders may experience dilution. Whereas the Company has been successful in
the past in raising capital, no assurance can be given that these sources of
financing can or will be available on terms favorable to M45. The Company's
ability to continue as a going concern is dependent on additional sources of
capital, otherwise development, and production will be delayed significantly.
Any such inability could have a material adverse effect on our business, results
of operations and financial condition.
Plan
of Operation (Continued)
M45 plans
to focus its operations and development on the Matagami Mining Camp or more
precisely in the specific area where the Company has obtained a full survey
NI-43-101 report. The report clearly indicates the presence of six (6) major
airborne magnetic anomalies similar to the Perseverance Zinc mine owned by the
world mining leader Xstrata plc in the Matagami Mining Camp, Quebec, and located
six (6) kilometers from M45’s territory. The independent geologist firm
confirmed this information being of sufficient merit to recommend an immediate
massive drilling program at a cost of $ 2.8 million (Cdn). As of August 10,
2009, the Company has not selected a mineral drilling sub-contractor. The
NI-43-101 report stipulated that any drilling operations must be executed
between months of January and March, because some of the key targets
are positioned in swampy areas, and, in addition, ice platforms and bridges
represent an economic advantageous. Our progress, in this regard, will depend on
our ability to raise enough financing to pursue the drilling
program.
The
Company's long-term viability as a going concern is dependent upon its ability
to generate sufficient cash flow from operations, to obtain additional
financing, and to eventually achieve profitability.
Results
of Operation
To date,
M45 has not generated any revenue and does not presently have any available
capital resources.
We
believe that our planned growth and the achievement of profitability will depend
in large part on our ability to promote our Company and to acquire key
territories. Accordingly, we intend to focus our attention and investment of
resources in marketing, development and exploration. If we are not successful in
promoting our Company and exploiting out territories, this may have a material
adverse effect on our financial condition and the ability to continue to operate
the business.
If
funding is insufficient at any time in the future, we may not be able to take
advantage of business opportunities or respond to competitive pressures, or may
be required to reduce the scope of our planned product development and marketing
efforts, any of which could have a negative impact on its business and operating
results. In addition, insufficient funding may have a material adverse effect on
our financial condition, which could require us to: i) curtail operations
significantly; ii) seek arrangements with strategic partners or other parties
that may require the Company to relinquish significant rights to territories,
technologies or markets; or iii) explore other strategic alternatives including
a merger or sale of the Company.
M45's
current management has indicated willingness, for the time being, to continue
rendering services to the Company, to advance sufficient funds to meet our
operational needs, and not to demand payment of sums owed. The Company therefore
believes that it can continue as a going concern in the near
future.
Liquidity
and Capital Resources
Since
inception and through the date of this report, we have issued 54,008,386 shares
of our common stock and received cash from all financing activities of
$583,497.
Off-Balance
Sheet Arrangements
For the
year ending March 31, 2009, the Company has no off-balance sheet
arrangements.
Critical
Accounting Policies
The
preparation of the financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ materially from
those estimates. We believe that there are several accounting policies that are
critical to understanding our historical and future performance, as these
policies affect the reported amounts of revenue and the more significant areas
involving management’s judgments and estimates. These significant
accounting policies relate to revenue recognition, valuation of long-lived
assets and income taxes. These policies, and the related procedures, are
described in detail below.
Revenue
Recognition
For the
fiscal years ended March 31, 2009 and 2008, the Company did not realize any
revenues from its mining operations.
Impairment
of long lived assets
Long-lived
assets of the Company are reviewed for impairment whenever events or changes in
circumstances indicate that their carrying value has become impaired, in
accordance with the guidance established in Statement of Financial Accounting
Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of
Long-Lived Assets.” An impairment loss would be recognized when the carrying
amount of an asset exceeds the estimated undiscounted future cash flows expected
to result from the use of the asset and its eventual disposition. The amount of
the impairment loss to be recorded is calculated by the excess of the asset’s
carrying value over its fair value. Fair value is generally determined using a
discounted cash flow analysis
Income
taxes
The
Company accounts for income taxes under the provisions of SFAS No. 109,
“Accounting for Income Taxes,” which requires the Company to recognize deferred
tax liabilities and assets for the expected future tax consequences of events
that have been recognized in the Company’s financial statements or tax returns
using the liability method. Under this method, deferred tax liabilities and
assets are determined based on the temporary differences between the financial
statement and tax bases of assets and liabilities using enacted tax rates in
effect in the years in which the differences are expected to reverse. The effect
on deferred income tax assets and liabilities of a change in income tax rates is
included in the period that includes the enactment date. Valuation allowances
are established when necessary to reduce deferred income tax assets to the
amount expected to be realized.
Item
7A. Quantitative and Qualitative Disclosures about Market
Risk.
We are a
smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are
not required to provide the information under this item.
Item
8. Financial Statements and Supplementary Data.
M45
MINING RESOURCES INC.
(A
Development Stage Company)
INDEX
TO FINANCIAL STATEMENTS
|
Page
|
||
|
Independent
Auditor's Report
|
F-1
|
|
|
Balance
Sheets as of March 31, 2009 and 2008
|
F-2
|
|
|
Statements
of Operations for the years ended March 31, 2009 and 2008 and the date of
Inception to March 31, 2009
|
F-3
|
|
|
Statement
of Changes in Stockholders ' Equity (Deficit)
|
F-4
|
|
|
Statements
of Cash Flows for the years ended March 31, 2009 and 2008 and the date of
Inception to March 31, 2009
|
F-5
|
|
|
Notes
to Financial Statements
|
F-6
|
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board of
Directors
M45
Mining Resources Inc.
I have
audited the accompanying balance sheet of M45 Mining Resources Inc. (a
development stage company) as of March 31, 2009 and 2008, and the related
statements of operations, changes in stockholders' equity (deficit), and cash
flows for the years ended March 31, 2009 and 2008. These financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these financial statements based on our
audits.
I
conducted my audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require
that I plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The
Company is not required to have, nor was I engaged to perform, an audit of its
internal control over financial reporting. My audit included
consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the Company’s
internal control over financial reporting. Accordingly, I express no such
opinion. 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. I believe
that my audits provide a reasonable basis for my opinion.
In my
opinion, the financial statements present fairly, in all material respects, the
financial position of M45 Mining Resources Inc. as of March 31, 2009 and 2008,
and the results of its operations, changes in stockholders' equity (deficit),
and its cash flows for the years ended March 31, 2009 and 2008, in conformity
with accounting principles generally accepted in the United States of
America.
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 9 to the financial
statements, the Company has incurred significant operating losses since
inception. The Company has limited operations, no working capital and has not
established a source of revenue. These factors, among others, raise substantial
doubt about its ability to continue as a going concern. Management's plans in
regard to these matters are described in Note 9 to the consolidated financial
statements. The accompanying consolidated financial statements do not include
any adjustments that may result from the outcome of this
uncertainty.
/s/
Patrick Rodgers, CPA, PA
Certified
Public Accountants
Altamonte
Springs, Florida
October
26, 2009
F-1
M45
MINING RESOURCES INC.
(A
Development Stage Company)
BALANCE
SHEETS
|
March 31,
|
||||||||
|
ASSETS
|
||||||||
|
Current
Assets
|
||||||||
|
Cash
|
$ | - | $ | - | ||||
|
Prepaid
expense
|
2,336 | 7,993 | ||||||
|
Total Current
Assets
|
2,336 | 7,993 | ||||||
|
Fixed
assets, net
|
75,274 | 95,986 | ||||||
|
Total
Assets
|
$ | 77,610 | $ | 103,979 | ||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
||||||||
|
Current
Liabilities
|
||||||||
|
Accounts
payable and accrued liabilites
|
$ | 3,000 | $ | - | ||||
|
Payables
due to related parties
|
146,422 | 186,401 | ||||||
|
Total Current Liabilities
|
149,422 | 186,401 | ||||||
|
STOCKHOLDERS'
EQUITY (DEFICIT)
|
||||||||
|
Common
stock, $.001 par value; 55,000,000 shares authorized, 54,008,386 shares
issued and outstanding
|
54,008 | 36,699 | ||||||
|
Additional
paid-in capital
|
6,862,985 | 6,426,396 | ||||||
|
Deficit
accumulated during the development stage
|
(6,988,805 | ) | (6,545,517 | ) | ||||
|
Total
Stockholders Equity (Deficit)
|
(71,812 | ) | (82,422 | ) | ||||
|
Total
Liabilities and Stockholders' Equity (Deficit)
|
$ | 77,610 | $ | 103,979 | ||||
The
accompanying notes are an integral part of the consolidated financial
statements.
F-2
M45
MINING RESOURCES INC.
(A
Development Stage Company)
STATEMENTS
OF OPERATIONS
|
Date
of
|
||||||||||||
|
Year
Ended
|
Year
Ended
|
Inception
to
|
||||||||||
|
March
31,
|
March
31,
|
March
31,
|
||||||||||
|
|
|
|
||||||||||
|
Sales
|
$ | - | $ | - | $ | - | ||||||
|
Expenses:
|
||||||||||||
|
Mining
claim acquisition costs
|
- | 1,250,000 | 2,156,486 | |||||||||
|
General
and administrative
|
374,136 | 3,877,958 | 4,300,419 | |||||||||
|
Marketing
|
3,988 | 44,515 | 48,503 | |||||||||
|
Research
and development
|
20,657 | 147,782 | 168,439 | |||||||||
|
Interest
Expense
|
16,493 | 35,649 | 68,612 | |||||||||
|
Depreciation
and Amortization
|
28,014 | 11,283 | 39,297 | |||||||||
|
Total
expenses
|
443,288 | 5,367,187 | 6,781,756 | |||||||||
|
Net Loss Before Discontinued
Operations and
Income Taxes
|
(443,288 | ) | (5,367,187 | ) | (6,781,756 | ) | ||||||
|
Net
effect of recapitalization
|
- | - | (124,668 | ) | ||||||||
|
Discontinued
operations - subsidiary
|
- | - | (255,997 | ) | ||||||||
|
Disposal
of subsidiary
|
- | - | 173,616 | |||||||||
|
Net
Loss Before Income Taxes
|
(443,288 | ) | (5,367,187 | ) | (6,988,805 | ) | ||||||
|
Income
taxes
|
- | - | - | |||||||||
|
Net
Loss
|
$ | (443,288 | ) | $ | (5,367,187 | ) | $ | (6,988,805 | ) | |||
|
BASIC
AND DILUTED LOSS PER SHARE
|
||||||||||||
|
Net
loss per weighted average share
|
||||||||||||
|
Net
operating loss
|
$ | (0.01 | ) | $ | (0.19 | ) | ||||||
|
Discontinued
operations
|
- | - | ||||||||||
|
Disposal
of subsidiary
|
- | - | ||||||||||
| $ | (0.01 | ) | $ | (0.19 | ) | |||||||
|
Weighted
average number of common shares used to compute net loss per
weighted average share
|
47,502,294 | 28,584,090 | ||||||||||
The
accompanying notes are an integral part of the consolidated financial
statements.
F-3
M45
RESOURCES INC.
(A
Development Stage Company)
STATEMENT
OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
|
Deficit
|
||||||||||||||||||||
|
Accumulated
|
||||||||||||||||||||
|
Additional
|
During
|
|||||||||||||||||||
|
Common Stock
|
Paid-in
|
Deveopment
|
||||||||||||||||||
|
Shares
|
Amount
|
Capital
|
Stage
|
Total
|
||||||||||||||||
|
Balance,
March 31, 2006
|
17,550,000 | $ | 17,550 | $ | 221,451 | $ | (372,796 | ) | $ | (133,795 | ) | |||||||||
|
Issuance
of Explorations
|
||||||||||||||||||||
|
Miniere
Grenville Stocks
|
909,090 | 905,577 | - | 906,486 | ||||||||||||||||
|
Net
loss for year
|
- | - | - | (805,534 | ) | (805,534 | ) | |||||||||||||
|
Balance,
March 31, 2007
|
18,459,090 | 18,459 | 1,127,028 | (1,178,330 | ) | (32,843 | ) | |||||||||||||
|
Employee
Stock Option Plan
|
7,000,000 | 7,000 | 3,318,000 | 3,325,000 | ||||||||||||||||
|
Expense
paid with Stock
|
- | - | (5,883 | ) | (5,883 | ) | ||||||||||||||
|
Miniere
Grenville Stocks
|
6,250,000 | 6,250 | 1,243,750 | 1,250,000 | ||||||||||||||||
|
Notes
Payable exchanged for stock
|
4,989,940 | 4,990 | 743,501 | - | 748,491 | |||||||||||||||
|
Net
loss for year
|
- | - | - | (5,367,187 | ) | (5,367,187 | ) | |||||||||||||
|
Balance,
March 31, 2008
|
36,699,030 | 36,699 | 6,426,396 | (6,545,517 | ) | (82,422 | ) | |||||||||||||
|
Expense
paid with Stock
|
8,595,000 | 8,595 | 42,880 | 51,475 | ||||||||||||||||
|
Directors
& Offices paid with stock
|
550,000 | 24,450 | 25,000 | |||||||||||||||||
|
Notes
Payable exchanged for stock
|
8,164,356 | 8,164 | 369,259 | 377,423 | ||||||||||||||||
|
Net
loss for year
|
- | - | - | (443,288 | ) | (443,288 | ) | |||||||||||||
|
Balance,
March 31, 2009
|
54,008,386 | $ | 54,008 | $ | 6,862,985 | $ | (6,988,805 | ) | $ | (71,812 | ) | |||||||||
The
accompanying notes are an integral part of the consolidated financial
statements.
F-4
M45
RESOURCES INC.
(A
Development Stage Company)
STATEMENTS
OF CASH FLOWS
|
Date of
|
||||||||||||
|
Year Ended
|
Year Ended
|
Inception to
|
||||||||||
|
March 31,
|
March 31,
|
March 31,
|
||||||||||
|
|
|
|
||||||||||
|
CASH
FLOWS FROM OPERATIONS
|
||||||||||||
|
Net
loss
|
$ | (443,288 | ) | $ | (5,367,187 | ) | $ | (6,988,805 | ) | |||
|
Adjustment
to reconcile net loss to net cash
|
||||||||||||
|
Depreciation
& Amortization
|
28,014 | 11,283 | 39,297 | |||||||||
|
Disposal
of subsidiary
|
- | - | (173,616 | ) | ||||||||
|
Discontinued
operations
|
- | - | 255,997 | |||||||||
|
Change
in receivables
|
- | 1,414 | 1,414 | |||||||||
|
Expenses
paid with stock
|
- | 1,993,501 | 2,899,987 | |||||||||
|
Employee
Stock Option Plan
|
- | 3,319,117 | 3,319,117 | |||||||||
|
Prepaid
deposits
|
5,657 | (7,993 | ) | (2,336 | ) | |||||||
|
Prior
period Foreign Exchange Fluctuation
|
- | (23,391 | ) | (15,548 | ) | |||||||
|
Increase
(decrease) in operating liabilities
|
||||||||||||
|
Changes
in payables
|
3,000 | (25,000 | ) | |||||||||
|
Bank
overdraft
|
- | - | - | |||||||||
|
Net
Cash Used For Operating Activites
|
(406,617 | ) | (98,256 | ) | (664,407 | ) | ||||||
|
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||||||||||
|
Acquisition
of fixed assets
|
(7,303 | ) | (93,940 | ) | (101,243 | ) | ||||||
|
Leasehold
Improvements
|
- | (13,329 | ) | (13,329 | ) | |||||||
|
Net
effect of recapitalization
|
- | - | 124,668 | |||||||||
|
Net
Cash Provided By (Used For) Investing Activities
|
(7,303 | ) | (107,269 | ) | 10,096 | |||||||
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||||||||||
|
Issuance
of common stock
|
17,309 | 10,873 | 28,182 | |||||||||
|
Net
effect of recapitalization
|
- | - | 5,470 | |||||||||
|
Variation
of advances from related parties
|
396,611 | 194,652 | 620,659 | |||||||||
|
Net
Cash Provided By Financing Activities
|
413,920 | 205,525 | 654,311 | |||||||||
|
Net
increase in cash
|
- | - | - | |||||||||
|
Cash,
beginning of period
|
- | - | - | |||||||||
|
Cash,
end of period
|
$ | - | $ | - | $ | - | ||||||
|
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION
|
||||||||||||
|
Interest
|
$ | 8,559 | $ | 50,126 | $ | 50,744 | ||||||
|
Income
tax
|
$ | - | $ | - | $ | - | ||||||
The
accompanying notes are an integral part of the consolidated financial
statements.
F-5
M45
MINING RESOURCES INC.
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
March 31,
2009 and 2008
Note
1—Organization and Nature of Business
Organization
The
Company was formed under the laws of the State of Nevada on July 26, 1990 under
the name of Quantitative Methods Corp., ("QTTM" or the "Company"). On
January 17, 2007, the Company changed its name to M45 Mining Resources Inc,
pursuant to an Amendment to its Certificate of Incorporation.
Nature
of Business
M45
Mining Resources Inc., (MRES.PK) formerly known as Quantitative Methods, Corp.
(QTTM: OB), is a development stage Company actively involved in mineral exploration.
The Company’s
strategy is focused on building shareholder value through the exploration and
development of mineral claims, particularly in the Matagami Mining Camp located
in Quebec, Canada.
Note
2—Summary of Significant Accounting Policies
Use of
Estimates
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 disclosure 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.
Cash
For the
Statements of Cash Flows, all highly liquid investments with maturity of three
months or less are considered to be cash equivalents. There were no cash
equivalents as of March 31, 2009 or 2008.
Concentration of Credit
Risk
The
Company's exposure to credit risk is minimal.
Advertising
Costs
The
Company recognizes advertising expense in accordance with Statement of Position
93-7, "Reporting on Advertising Costs". As such, the Company expenses the cost
of communicating advertising in the period in which the advertising space or
airtime is used. Advertising costs for the year ended March 31, 2009 was $0 and
$1,555 for the corresponding period in 2008.
Depreciation and
Amortization
Property
and equipment are stated at cost. Depreciation is calculated on the estimated
useful lives of the assets using the straight line depreciation method.
Leasehold Improvements is calculated on the remaining lease period and using the
straight line amortization method.
F-6
M45
MINING RESOURCES INC.
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
March 31,
2009 and 2008
Note
2—Summary of Significant Accounting Policies (Continued)
Income
taxes
Income
taxes are provided for using the liability method of accounting in accordance
with SFAS No. 109 “Accounting for Income Taxes,” and clarified by FIN
48,“Accounting for Uncertainty in Income Taxes—an interpretation of FASB
Statement No. 109.” A deferred tax asset or
liability is recorded for all temporary differences between financial and tax
reporting. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax basis. Deferred tax assets are
reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. Deferred tax assets and liabilities are adjusted for the effect of
changes in tax laws and rates on the date of enactment.
Share Based
Expenses
In
December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No.
123R “Share Based Payment.” This statement is a revision to SFAS 123 and
supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for
Stock Issued to Employees,” and amends FASB Statement No. 95, “Statement of Cash
Flows.” This
statement requires a public entity to expense the cost of employee services
received in exchange for an award of equity instruments. This statement also
provides guidance on valuing and expensing these awards, as well as disclosure
requirements of these equity arrangements. The Company adopted SFAS No. 123R
upon creation of the company and expenses share based costs in the period
incurred.
Development Stage
Enterprise
The
Company has realized no revenues from its planned business purpose and,
accordingly, is considered to be in its development stage as defined in SFAS No.
7, “Accounting and Reporting by Development Stage Enterprises.” The Company has devoted
substantially all of its efforts to business planning, and development.
Additionally, the Company has allocated a substantial portion of its time and
investment in bringing its product to the market, and the raising of
capital.
Basic and Diluted Net
Income (Loss) Per Share
The
Company computes net income (loss) per share in accordance with SFAS No. 128,
"Earnings per Share" (SFAS 128). SFAS 128 requires dual presentation of both
basic and diluted earnings per share (EPS) on the face of the income statement.
Basic EPS is computed by dividing net income (loss) attributable to common
stockholders (numerator) by the weighted average number of common shares
outstanding (denominator) during the period. The Company had no potential common
stock instruments which would result in a diluted loss per share.
Financial
Instruments
Fair
value estimates discussed herein are based upon certain market assumptions and
pertinent information available to management as of March 31, 2009. The
respective carrying value of certain on-balance-sheet financial instruments
approximated their fair values. These financial instruments include cash,
accounts receivable, bank loans, accounts payable, accrued liabilities, notes
and amounts due to related parties. The fair values were assumed to approximate
their carrying values due to the immediate or short-term maturity of these
financial instruments.
F-7
M45
MINING RESOURCES INC.
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
March 31,
2009 and 2008
Note 2—Summary of Significant
Accounting Policies (Continued)
Dividends
Dividends
may be paid on outstanding shares as declared by the Board of Directors. Each
share of common stock is entitled to one vote. The Company has not yet adopted
any policy regarding payment of dividends. No dividends have been paid or
declared since inception.
Interest Rate
Risk
The
Company is exposed to fluctuating interest rates.
Translation of Foreign
Currencies
The
Company's functional currency is the United States dollar. Foreign currency
transactions occasionally occur, and are primarily undertaken in United States
dollars. Management has adopted SFAS No. 52, "Foreign Currency Translation".
Monetary balance sheet items denominated in foreign currencies are translated
into United States dollars at rates of exchange in effect at the balance sheet
date. Average rates for the year are used to translate revenues and expenses.
Resulting translation gains and losses are charged to operations. The Company
has (3,204), to the date of these financial statements, entered into derivative
instruments to offset the impact of foreign currency fluctuations.
Recent Accounting
Pronouncements
On June
12, 2009 the FASB issued two statements that amended the guidance for
off-balance-sheet accounting of financial instruments: SFAS No. 166, “Accounting for
Transfers of Financial Assets,” and SFAS No. 167, “Amendments to FASB
Interpretation No. 46(R).” SFAS No. 166 revises SFAS No. 140, “Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities,”
and will require entities to provide more information about sales of securitized
financial assets and similar transactions, particularly if the seller retains
some risk to the assets, the FASB said. The statement eliminates the concept of
a qualifying special-purpose entity, changes the requirements for the
derecognizing of financial assets, and calls upon sellers of the assets to make
additional disclosures about them.
SFAS No.
167 amends FASB Interpretation (FIN) No. 46(R), “Consolidation of Variable
Interest Entities,” by altering how a company determines when an entity that is
insufficiently capitalized or not controlled through voting should be
consolidated, the FASB said. A company has to determine whether it should
provide consolidated reporting of an entity based upon the entity's purpose and
design and the parent company's ability to direct the entity's
actions. SFAS Nos. 166 and 167 will be effective at the start of the
first fiscal year beginning after November 15, 2009. The Company is currently in
the process of evaluating the effect, if any, the adoption of SFAS No. 166 and
167 will have on its results of operations, financial position, and financial
disclosures.
In May
2009, the FASB issued SFAS 165, “Subsequent Events.” SFAS 165 should not result
in significant changes in the subsequent events that an entity reports. Rather,
SFAS 165 introduces the concept of financial statements being available to be
issued. Financial statements are considered available to be issued when they are
complete in a form and format that complies with generally accepted accounting
principles (GAAP) and all approvals necessary for issuance have been
obtained. The Company does not anticipate that the adoption of SFAS
165 will have a material impact on its financial position, results of
operations, or financial disclosures.
F-8
M45
MINING RESOURCES INC.
(A
Development Stage Company)