For the month ofOctober, 2004
Commission File No.000-30972
BRADNER VENTURES LTD.
(Translation of registrant’s name into English)
Suite 1900, 200 Burrard Street, Vancouver, British Columbia, Canada V6C 3L6
(Address of principal executive office)
[Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F]
Form 20-F [ X] Form 40-F [ ]
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1) [ ]
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7) [ ]
Note:Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes [ ] No [X]
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
82 —
2
Bradner Ventures Ltd.
(A Development Stage Company)
Interim Financial Statements
(Expressed in Canadian dollars)
(Unaudited)
August 31, 2004
3
| LANCASTER & DAVID | Incorporated Partners |
| Chartered Accountants | David E. Lancaster, C.A. Michael J. David, C.A. |
We have compiled the interim balance sheet of Bradner Ventures Ltd. as at August 31, 2004 and the interim statements of loss and deficit and cash flows for the three month and nine month periods ended August 31, 2004 from information provided by management. We have not audited, reviewed or otherwise attempted to verify the accuracy or completeness of such information. Readers are cautioned that these statements may not be appropriate for their purposes.
/s/ Lancaster & David
CHARTERED ACCOUNTANTS
Vancouver, BC
September 22, 2004
Vancouver Office - Suite 510, 701 West Georgia Street, PO Box 10133, Vancouver, BC, Canada V7Y 1C6 Facsimile: 604.602.0867
New Westminster Office - Suite 404, 960 Quayside Drive, New Westminster, BC, Canada, V3M 6G2 Facsimile: 604.5249837
Telephone: 604.717.5526 email: admin@lancasteranddavid.ca
4
Bradner Ventures Ltd.
(A Development Stage Company)
Interim Balance Sheets
(Expressed in Canadian dollars)
| August 31, 2004 $ | November 30, 2003 $ | |||||||
| (Audited) | ||||||||
| ASSETS | ||||||||
Current Assets | ||||||||
Cash | 150,493 | 222 | ||||||
| Accounts receivable | 997 | 92 | ||||||
| Total Assets | 151,490 | 314 | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||
Current Liabilities | ||||||||
Accounts payable and accrued liabilities | 1,071 | 22,144 | ||||||
| Due to related party | -- | 40,021 | ||||||
| 1,071 | 62,165 | |||||||
| Stockholders' Equity (Deficit) | ||||||||
Capital Stock (Note 2) | ||||||||
| Authorized: 75,000,000 common shares, without par value | ||||||||
| 25,000,000 preferred shares, without par value | ||||||||
| Issued: 10,291,284 common shares (November 30, 2003 - 5,291,284) | 4,279,498 | 4,029,498 | ||||||
Deficit Accumulated During the Development Stage | (4,129,079 | ) | (4,091,349 | ) | ||||
| Total Stockholders' Equity (Deficit) | 150,419 | (61,851 | ) | |||||
| Total Liabilities and Stockholders' Equity (Deficit) | 151,490 | 314 | ||||||
| "Richard Coglon" | "Randy Buchamer" |
| Director | Director |
The accompanying notes are an integral part of these interim financial statements
5
Bradner Ventures Ltd.
(A Development Stage Company)
Interim Statements of Operations
(Expressed in Canadian dollars)
(Unaudited – See Notice to Reader)
| Accumulated from June 22, 1983 (Date of Inception) | Three months ended August 31, | Nine months ended August 31, | |||||||||||||||
| to August 31, 2004 $ | 2004 $ | 2003 $ | 2004 $ | 2003 $ | |||||||||||||
| EXPENSES | |||||||||||||||||
| Amortization | 2,095 | -- | -- | -- | -- | ||||||||||||
| Bad debts | 248 | -- | -- | -- | -- | ||||||||||||
| Bank charges and interest (recovery) | 62,927 | 24 | 122 | 158 | (2,172 | ) | |||||||||||
| Consulting and secretarial | 205,016 | -- | -- | -- | -- | ||||||||||||
| Finders' fees | 180,727 | -- | -- | -- | -- | ||||||||||||
| Management fees | 337,781 | -- | -- | -- | -- | ||||||||||||
| Mineral property expenses | 50,620 | -- | -- | -- | -- | ||||||||||||
| Office and miscellaneous | 119,802 | 2,255 | 106 | 2,599 | 3,424 | ||||||||||||
| Professional fees | 697,603 | 11,513 | 858 | 22,407 | 15,549 | ||||||||||||
| Shareholder information | 85,047 | -- | 1,304 | 2,907 | 2,654 | ||||||||||||
| Transfer agent and regulatory fees | 151,433 | 1,246 | 2,042 | 9,628 | 5,702 | ||||||||||||
| Travel and promotion | 76,952 | -- | -- | -- | -- | ||||||||||||
| Write-down of mineral property | 1,456,807 | -- | -- | -- | -- | ||||||||||||
| 3,427,058 | 15,038 | 4,432 | 37,699 | 25,157 | |||||||||||||
| OTHER ITEMS | |||||||||||||||||
| Interest income | (25,440 | ) | -- | -- | -- | -- | |||||||||||
| Gain on settlement of debt | (1,303 | ) | -- | -- | -- | -- | |||||||||||
| Gain on option | (1,187,500 | ) | -- | -- | -- | -- | |||||||||||
| Foreign exchange (gain) loss | (1,704 | ) | 24 | (2 | ) | 31 | 16 | ||||||||||
| Loss on sale of capital assets | 344 | -- | -- | -- | -- | ||||||||||||
| Loss on sale of long-term investment | 630,397 | -- | -- | -- | -- | ||||||||||||
| Write-down of advances to affiliate | 637,768 | -- | -- | -- | -- | ||||||||||||
| Write-down of long-tem investment | 649,459 | -- | -- | -- | -- | ||||||||||||
| 702,021 | 24 | (2 | ) | 31 | 16 | ||||||||||||
| Net Loss for the Period | (4,129,079 | ) | (15,062 | ) | (4,430 | ) | (37,730 | ) | (25,173 | ) | |||||||
| Net Loss Per Share | (0.00 | ) | (0.00 | ) | (0.01 | ) | (0.00 | ) | |||||||||
| Weighted Average Shares Outstanding | 5,950,624 | 5,291,284 | 5,574,303 | 5,291,284 | |||||||||||||
The accompanying notes are an integral part of these interim financial statements
6
Bradner Ventures Ltd.
(A Development Stage Company)
Interim Statements of Cash Flows
(Expressed in Canadian dollars)
(Unaudited – See Notice to Reader)
| Accumulated from June 22, 1983 (Date of Inception) | Three months ended August 31, | Nine months ended August 31, | |||||||||||||||
| to August 31, 2004 $ | 2004 $ | 2003 $ | 2004 $ | 2003 $ | |||||||||||||
| NET INFLOW (OUTFLOW) OF CASH RELATED TO THE | |||||||||||||||||
| FOLLOWING ACTIVITIES: | |||||||||||||||||
OPERATING | |||||||||||||||||
| Net loss for the period | (4,129,079 | ) | (15,062 | ) | (4,430 | ) | (37,730 | ) | (25,173 | ) | |||||||
| Adjustments to reconcile net loss to net cash | |||||||||||||||||
| used in operating activities: | |||||||||||||||||
| Amortization | 2,095 | -- | -- | -- | -- | ||||||||||||
| Bad debts | 248 | -- | -- | -- | -- | ||||||||||||
| Finders' fees | 114,932 | -- | -- | -- | -- | ||||||||||||
| Gain on debt settlement | (1,303 | ) | -- | -- | -- | -- | |||||||||||
| Gain on option | (1,187,500 | ) | -- | -- | -- | -- | |||||||||||
| Loss on sale of capital assets | 344 | -- | -- | -- | -- | ||||||||||||
| Loss on sale of investments | 630,397 | -- | -- | -- | -- | ||||||||||||
| Write-down of advances to affiliate | 637,768 | -- | -- | -- | -- | ||||||||||||
| Write-down of mineral property | 1,468,807 | -- | -- | -- | -- | ||||||||||||
| Write-down of long-term investment | 649,459 | -- | -- | -- | -- | ||||||||||||
| Decrease (increase) in accounts receivable | (1,245 | ) | 741 | 1,355 | (905 | ) | 56 | ||||||||||
| Decrease (increase) in prepaid expenses | -- | -- | -- | -- | 500 | ||||||||||||
| Increase (decrease) in accounts payable and | |||||||||||||||||
| accrued liabilities | 462,939 | (72,724 | ) | (1,212 | ) | (21,073 | ) | 8,142 | |||||||||
| Increase (decrease) in due to related parties | (40,021 | ) | (25,000 | ) | 5,733 | (40,021 | ) | 15,751 | |||||||||
| Net cash used in operating activities | (1,392,159 | ) | (112,045 | ) | 1,446 | (99,729 | ) | (724 | ) | ||||||||
FINANCING | |||||||||||||||||
| Advances to affiliate | (224,042 | ) | -- | -- | -- | -- | |||||||||||
| Capital stock issued for cash | 3,419,522 | 250,000 | -- | 250,000 | -- | ||||||||||||
| Net cash flows provided by financing activities | 3,195,480 | 250,000 | -- | 250,000 | -- | ||||||||||||
INVESTING | |||||||||||||||||
| Purchase of capital assets | (3,038 | ) | -- | -- | -- | -- | |||||||||||
| Expenditures on mineral properties | (1,121,172 | ) | -- | -- | -- | -- | |||||||||||
| Proceeds from disposal of capital assets | 600 | -- | -- | -- | -- | ||||||||||||
| Purchase of investments | (310,025 | ) | -- | -- | -- | -- | |||||||||||
| Advances to affiliate | (584,304 | ) | -- | -- | -- | -- | |||||||||||
| Proceeds on disposal of investments | 365,111 | -- | -- | -- | -- | ||||||||||||
| Net cash flows used in investing activities | (1,652,828 | ) | -- | -- | -- | -- | |||||||||||
NET CASH INFLOW (OUTFLOW) | 150,493 | 137,955 | 1,446 | 150,271 | (724 | ) | |||||||||||
CASH, BEGINNING OF PERIOD | -- | 12,538 | 509 | 222 | 2,679 | ||||||||||||
CASH, END OF PERIOD | 150,493 | 150,493 | 1,955 | 150,493 | 1,955 | ||||||||||||
The accompanying notes are an integral part of these interim financial statements
7
Bradner Ventures Ltd.
(A Development Stage Company)
Notes to the Interim Financial Statements
(Expressed in Canadian dollars)
(Unaudited – See Notice to Reader)
| The Company was incorporated on June 22, 1983 and is currently in the business of seeking and identifying suitable business opportunities or business combinations. The Company’s common shares are listed on the OTC Bulletin Board under the trading symbol “BVLTF”. The Company is a development stage company and accordingly, the statement of operations and cash flows include a total of all expenditures and other income and expenses since inception, June 22, 1983 to August 31, 2004. |
| These financial statements have been prepared in accordance with generally accepted accounting principles in Canada on the assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. The Company has accumulated losses of $4,129,079 since inception, which raises substantial doubt about the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. |
| The operations of the Company have primarily been funded by the issuance of capital stock. Continued operations of the Company are dependent on the Company’s ability to complete equity financings or generate profitable operations in the future. Management’s plan in this regard is to secure additional funds through future equity financings. Such financings may not be available or may not be available on reasonable terms. |
| Number of Common Shares | Amount | |||||||
|---|---|---|---|---|---|---|---|---|
| Authorized: | ||||||||
| 75,000,000 common shares without par value | ||||||||
| 25,000,000 preferred shares without par value | ||||||||
Issued: | ||||||||
As at November 30, 2002 and August 31, 2003 | 5,291,284 | $ | 4,029,498 | |||||
| As at November 30, 2003 | 5,291,284 | $ | 4,029,498 | |||||
| Issued during the period for cash by way of private placement | 5,000,000 | 250,000 | ||||||
| As at August 31, 2004 | 10,291,284 | $ | 4,279,498 | |||||
| Number of Shares | Exercise Price | Expiry Date | ||
|---|---|---|---|---|
| Options | 50,000 | US$0.15 | June 26, 2011 | |
| During the nine-month period ended August 31, 2004, the Company completed a private placement offering consisting of 5,000,000 units at a price of $0.05 per unit to net the Company proceeds of $250,000. Each unit consisted of one common share and one share purchase warrant. Each warrant is exercisable on or before June 18, 2007 into one common share at a price of $0.10 per share. |
| During the nine-month period ended August 31, 2004, 125,000 warrants exercisable at US $0.25 per share expired. |
| Basic loss per share is computed by dividing the loss for the year by the weighted average number of common shares outstanding during the year. Diluted loss per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock. The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the “if converted” method. Fully diluted amounts are not presented when the effect of the computations are anti-dilutive due to the losses incurred. Accordingly, there is no difference in the amounts presented for basic and diluted loss per share. |
8
Bradner Ventures Ltd.
(A Development Stage Company)
Notes to the Interim Financial Statements
(Expressed in Canadian dollars)
(Unaudited – See Notice to Reader)
| The Company primarily operates in one reportable operating segment, being the seeking and identification of suitable business opportunities or business combinations in Canada. |
| Pursuant to a decision of the United States Department of the Interior/Bureau of Land Management (“BLM”), the Company was advised that a Notice of Record of Non-compliance, relating to land reclamation, was issued against the Company. The Company was to respond to the Notice and its requirements, which included a US $12,078 (CAD $17,875) purchase of an interim bond and a reclamation plan, by January 6, 2000, at which time the BLM was to be in a position to pursue a court order through the Federal Court system. |
| To date, no action has been commenced by the BLM and a reclamation plan has not been submitted. The potential cost of the reclamation work cannot be accurately estimated by the Company because it has not obtained an assessment estimating the costs and scope of work required for the necessary reclamation work. However, the potential liability could exceed the amount of the interim bond of US $12,078 (CAD $17,875). No estimate can be made for the potential liability arising from the reclamation plan because of this reason. Therefore, the outcome of settlement, if any, cannot be determined, and accordingly, no amount of settlement has been accrued on these financial statements. Any amount will be recorded in the year of settlement. |
| These financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”). Material variations in the accounting principles, practices and methods used in preparing these financial statements from principles, practices and methods accepted in the United States (“United States GAAP”) and in SEC Regulation S-X are described and quantified below. |
| a) | Stock-based Compensation |
| Under United States GAAP, Statements of Financial Accounting Standards No. 123, “Accounting for Stock-based Compensation” (“SFAS 123”) requires expanded disclosure of stock-based compensation arrangements with employees and encourages, but does not require, the recognition of compensation expense related to stock compensation based on the fair value of the equity instrument granted. Companies that do not adopt the fair value recognition provisions of SFAS 123 and continue to follow the existing Accounting Principles Board Opinion No. 25 (“APB 25”) rules to recognize and measure compensation are required to disclose the pro-forma amounts of net income and earnings per share that would have been reported had the Company elected to follow the fair value recognition rules of SFAS 123. The Company has elected to continue to use the intrinsic value-based method of APB 25 and has adopted the disclosure requirements of SFAS 123. For the nine month period ended August 31, 2004 and the year ended November 30, 2003, the application of Canadian GAAP conforms with United States GAAP requirements for reporting stock-based compensation under APB 25 adopting the disclosure requirements of SFAS 123. |
| b) | New Accounting Standards |
| Management does not believe that any recently issued, but not yet effective accounting standard if currently adopted could have a material effect on the accompanying financial statements. |
| There are no material differences between Canadian GAAP and United States GAAP on the balance sheets and statements of operations and cash flows presented. |
9
The following discussion and analysis of our financial condition and results of operations for the three month period ended August 31, 2004 and the three years ended November 30, 2003 should be read in conjunction with our consolidated financial statements and related notes included in this quarterly report and those in our annual report. Our financial statements included in this quarterly report were prepared in accordance with Canadian GAAP. For a reconciliation of our financial statements included in our annual report to U.S. GAAP, see Note 9 to the financial statements in our annual report.
Except as otherwise noted, the amounts included in the following discussion are expressed in Canadian dollars.
We are a Foreign Private Issuer with a class of securities registered under Section 12(g) of the United StatesSecurities Exchange Act of 1934, as amended. As a result, the following discussion and analysis of our financial condition and results of operations for the three years ended November 30, 2003 has been extracted from our Annual Report on Form 20-F/A, as filed with the United States Securities and Exchange Commission on July 9, 2004. The effective date of this report is July 30, 2004.
Forward-Looking Statements
Except for historical information, the Management’s Discussion and Analysis may contain forward-looking statements. These statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance or achievements to be material different from any future results, levels of activity, performance or achievement expressed or implied by these forward-looking statements.
Description of Business
We are in the business of seeking and identifying suitable business opportunities or business combinations.
Results of Operations
Quarter Ended August 31, 2004
Our net loss for the quarter ended August 31, 2004 was $15,062 which was $0.00 per share. This loss compares to a loss of $4,430 for the quarter ended August 31, 2003 which was $0.00 per share. Expenses incurred in the quarter as well as the comparable quarter in 2003 were primarily those required to maintain our continuous disclosure requirements as a public company while we seek and identify a suitable business opportunity or business combination.
Total assets and shareholders’ equity as at August 31, 2004 and November 30, 2003 are as follows:
| As at August 31, 2004 | As at November 30, 2003 | |||||||
|---|---|---|---|---|---|---|---|---|
| Total assets | $ | 151,490 | $ | 314 | ||||
| Shareholders' equity (deficit) | 150,419 | (61,851 | ) | |||||
Nine Months Ended August 31, 2004
Our net loss for the nine months ended August 31, 2004 was $37,730 which was $0.01 per share. This loss compares to a loss of $25,173 for the nine months ended August 31, 2003 which was $0.00 per share. Expenses incurred in the quarter as well as the comparable quarter in 2003 were primarily those required to maintain our continuous disclosure requirements as a public company while we seek and identify a suitable business opportunity or business combination.
10
Year Ended November 30, 2003
For the year ended November 30, 2003, we incurred net losses of $27,840. For the year ended November 30, 2002, we incurred net losses of $261,950 and for the year ended November 30, 2001, we incurred losses of $489,432. We did not generate any revenues for the years ended November 30, 2003, 2002 and 2001. As we do not presently have an operating business which we can pursue, our management is seeking to either identify a suitable business opportunity or enter into a suitable business combination. Our management does not believe that we will be able to generate revenues without identifying and completing the acquisition of a suitable business opportunity. In addition, if we are unable to identify a suitable business opportunity, our shareholders will not realize a return on their investment in our company, and there will be no market for our common shares.
We will continue to seek a new business opportunity. Once a business opportunity has been identified, we will investigate and evaluate the business opportunity. In selecting a suitable business opportunity, management intends to focus on the potential for future profits and strength of current operating management of the business opportunity. Management believes that the greatest potential lies in resource based companies. Nevertheless, this shall not preclude any other category of business or industry to be investigated and evaluated by us as opportunities arise.
We will conduct our own investigation to identify an appropriate business opportunity. We will seek a potential business opportunity from all known sources but will rely principally upon personal contacts of our officers and directors, as well as indirect associations between them and other business and professional people.
Selected Annual Information
The following are highlights of selected audited financial data for our most recently completed three financial years:
| Nov. 30, 2003 | Nov. 30, 2002 | Nov. 30, 2001 | |
|---|---|---|---|
Loss before extraordinary items | $ 27,840 | $ 261,950 | $489,432 |
Net Loss | $ 27,840 | $ 261,950 | $489,432 |
Loss per Share | $ 0.02 | $ 0.05 | $ 0.13 |
Total Assets | $ 314 | $ 3,435 | $ 43,146 |
Total Liabilities | $ 62,165 | $ 37,446 | $ 32,226 |
Working Capital (Deficiency) | ($ 61,851) | ($ 34,011) | $ 10,920 |
Summary of Quarterly Results
The following are highlights of selected unaudited financial data for our most recently completed eight quarterly periods:
11
| 2004 | 2003 | 2002 | ||||||
|---|---|---|---|---|---|---|---|---|
| Period ended | Aug. 31 Q3 | May 31 Q2 | Feb. 29 Q1 | Nov. 30 Q4 | Aug. 31 Q3 | May 31 Q2 | Feb. 28 Q1 | Nov. 30 Q4 |
Total Revenue | Nil | Nil | Nil | Nil | Nil | Nil | Nil | Nil |
Income (loss) before discontinued operations and extraordinary items | ($ 15,062) | ($ 14,032) | ($ 8,636) | ($ 27,840) | ($ 4,430) | ($ 20,011) | ($ 732) | ($ 261,950) |
Basic per share | (0.00) | (0.00) | (0.01) | (0.01) | (0.001 | (0.00) | (0.01) | (0.05) |
Diluted per share | (0.00) | (0.00) | (0.01) | (0.01) | (0.001 | (0.00) | (0.01) | (0.05) |
Net income (loss) | ($ 15,062) | ($ 14,032) | ($ 8,636) | ($ 27,840) | ($ 4,430) | ($ 20,011) | ($ 732) | ($ 261,950) |
Basic per share | (0.00) | (0.00) | (0.01) | (0.01) | (0.001 | (0.00) | (0.01) | (0.05) |
Diluted per share | (0.00) | (0.00) | (0.01) | (0.01) | (0.001 | (0.00) | (0.01) | (0.05) |
As at August 31, 2004
During the nine month period ended August 31, 2004, we spent $37,699 on operations. The Company completed a private placement offering of 5,000,000 units at a price of $0.05 per unit to net the Company proceeds of $250,000 and one of our directors advanced $25,000 to us during the period, thereby increasing our cash position from $222 at November 30, 2003 to $150,493 at August 31, 2004. The operating expenses for the nine month period ended August 31, 2004 of $37,699 consisted primarily of professional fees (accounting, administration and legal) of $22,407 and transfer agent and regulatory fees of $9,628. At August 31, 2004 we had working capital of $150,419. We require additional funds to fund our ongoing operations. To date, our primary source of funds has been the sale of our common stock.
We are actively seeking business opportunities and if warranted, expenses will be incurred as part of the due diligence process. If an acquisition agreement is concluded in fiscal 2004, it is possible that additional professional, filing and due diligence costs will be incurred and that we may seek additional financing to fund future business ventures.
We do not presently have any material commitments for capital expenditures. There are no assurances that we will be able to obtain further funds as may be required for our continued operations. We are pursuing various financing alternatives to meet our immediate and long-term financial requirements, which we anticipate will consist of further private placements of equity securities, advances from related parties or shareholder loans. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, we will not be able to meet our other obligations as they become due and we will be forced to scale down or perhaps even cease our operations.
12
As at November 30, 2003
During the year ended November 30, 2003, we spent $2,457 on operations and had no cash outflows from investing and financing activities, thereby decreasing our cash position from $2,679 at November 30, 2002 to $222 at November 30, 2003. The normal operating expenses for the year ended November 30, 2003 of $27,824 consisted of professional fees (accounting, administration and legal) of $17,509, transfer agent and regulatory fees of $6,277 and office and miscellaneous fees of $3,493.
Related Party Transactions
During the nine month period ended August 31, 2004, one of our directors advanced $25,000 to us. The advance is unsecured, non-interest bearing and has no specific terms of repayment.
During the year ended November 30, 2003, we paid ASI Accounting Services Inc. fees totaling $7,778 (comprised of $4,778 in accounting fees and general administration fees and $3,000 in rent). Between December 1, 2003 and March 31, 2004, we paid or accrued ASI Accounting Services Inc. fees totaling $2,500 for accounting fees and general administration fees. Ron Schmitz, our former President and director, is also the President of ASI Accounting Services Inc.
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
The preparation of financial statements in conformity with generally accepted accounting principles requires our 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 periods.
Our management routinely makes judgments and estimates about the effects of matters that are inherently uncertain. As the number of variables and assumptions affecting the probable future resolution of the uncertainties increase, these judgments become even more subjective and complex.
The key elements and assumptions that we have made under these principles and their impact on the amounts reported in the consolidated financial statements remain substantially unchanged from those described in our 2003 audited consolidated financial statements. We have not had any changes in the accounting policies in the current period.
See Note 2 to our annual financial statements for our Significant Accounting Policies.
Our financial instruments consist of cash, accounts receivable, accounts payable, accrued liabilities and amounts due to related parties. The amounts due to related parties are interest-free. It is management’s opinion that we are not exposed to significant interest, currency or credit risks arising from our financial instruments and that their fair values approximate their carrying values unless otherwise noted.
We have not had significant revenue from operations in either of our last two financial years. The following table is a breakdown of the material components listed for the two most recently completed financial years and for the nine month periods ended August 31, 2004 and August 31, 2003:
13
| Nine Months Ended August 31, 2004 | Nine Months Ended August 31, 2003 | Year Ended November 31, 2003 | Year Ended November 31 2002 | |
|---|---|---|---|---|
Capitalized or expensed exploration amd development costs | Nil | Nil | Nil | Nil |
Expensed research and development costs | Nil | Nil | Nil | Nil |
Deferred development costs | Nil | Nil | Nil | Nil |
General and Administration expenses | $15,038 | $37,699 | $27,824 | $ 70,206 |
Material costs, whether capitalized, deferred or expenses, not referred to in the above | $ 24 | $ (2 | $ 16 | $191,744 |
Our shares are quoted for trading on the NASD’s over-the-counter bulletin board in the United States.
| Class of shares | Par Value | Number Authorized | Number issued |
|---|---|---|---|
Common | No Par Value | 75,000,000 | 10,291,284 |
Preferred | No Par Value | 25,000,000 | Nil |
We have the following options and warrants outstanding:
| Type | Number of Shares | Exercise Price | Expiry Date |
|---|---|---|---|
Options | 50,000 | US$0.15 | June 26, 2011 |
Warrants | 5,000,000 | $0.10 | June 18, 2007 |
Additional information relating to us is available on SEDAR atwww.sedar.com.
14
I, Richard Coglon, President and Director of Bradner Ventures Ltd. and performing similar functions to that of a Chief Executive Officer, certify that:
| 1. | I have reviewed the interim filings (as this term is defined in Multilateral Instrument 52-109Certification of Disclosure in Issuers’ Annual and Interim Filings)of Bradner Ventures Ltd. (the issuer) for the interim period ending August 31, 2004; |
| 2. | Based on my knowledge, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings; and |
| 3. | Based on my knowledge, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial condition, results of operations and cash flows of the issuer, as of the date and for all the periods presented in the interim filings. |
Date: October 27, 2004
“Richard Coglon”
RICHARD COGLON
President and Director
15
I, Randy Buchamer, Chief Financial Officer and Director of Bradner Ventures Ltd., certify that:
| 1. | I have reviewed the interim filings (as this term is defined in Multilateral Instrument 52-109Certification of Disclosure in Issuers’ Annual and Interim Filings)of Bradner Ventures Ltd. (the issuer) for the interim period ending August 31, 2004; |
| 2. | Based on my knowledge, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings; and |
| 3. | Based on my knowledge, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial condition, results of operations and cash flows of the issuer, as of the date and for all the periods presented in the interim filings. |
Date: October 27, 2004
“Randy Buchamer”
RANDY BUCHAMER
Chief Financial Officer
16
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.
/s/ Richard Coglon
Richard Coglon, President
Date: October 28, 2004
