ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
Keystone Mines Limited |
(A Development Stage Company) |
Balance Sheets |
(expressed in U.S. dollars) |
| December 31, | | June 30, | | December 31, |
| 2002 | | 2002 | | 2002 |
| $ | | $ | | $ |
| (unaudited) | | (audited) | | (unaudited Pro Forma) |
| | | | | (Note 1) |
ASSETS | | | | | |
Current Assets | | | | | |
Cash
| 14
|
| 11,530
|
| 14
|
Total Current Assets | 14 | | 11,530 | | 14 |
Capital Assets (Note 1)
| | | | | 67,725 |
Patents (Note 1)
| | | | | 75,990 |
In Process Reseach and Development (Note 1)
| | | | | 0 |
C-Chip Technology (Note 1)
| | | | | 574,285 |
Mineral Properties
| -
|
| 27
|
| -
|
Total Assets
| 14
|
| 11,557
|
| 718,014
|
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | | | | | |
Current Liabilities | | | | | |
Accounts payable | - | | 1,941 | | 40,000 |
Accrued liabilities | 1,500 | | - | | 1,500 |
Promissory Note (Note 1) | | | | | 500,000 |
Due to related party
| -
|
| 1,018
|
| -
|
Total Current Liabilities | 1,500 | | 2,959 | | 541,500 |
Debenture (Note 1)
|
|
|
|
| 803,000
|
Total Liabilities
| 1,500
|
| 2,959
|
| 1,344,500
|
Stockholders' Equity (Deficit) | | | | | |
Common Stock, 100,000,000 shares authorized | | | | | |
with a par value of $0.00001; 25,223,060 (2001- | | | | | |
6,011,198) shares issued and outstanding (Note 1) | 60 | | 60 | | 60 |
| | | | | |
Additional Paid-in Capital
| 601,060
|
| 601,060
|
| 626,050
|
| 601,120 | | 601,120 | | 626,110 |
Deficit Accumulated During the Development Stage
| -602,606
|
| -592,522
|
| -1,252,606
|
Total Stockholders' Equity (Deficit)
| -1,486
|
| 8,598
|
| -626,486
|
Total Liabilities and Stockholders' Equity
| 14
|
| 11,557
|
| 718,004
|
Keystone Mines Limited
(A Development Stage Company)
Note 1 to Pro Forma Balance Sheet, December 31, 2002
The Pro Forma Balance Sheet as at December 31, 2002 reflects the January 7, 2003 purchased the assets and intellectual property relating to C-ChipJJ technology. The C-ChipJJ technology acquired is a new patent-pending wireless communications set of tools that offers complete remote control and access over targeted equipment and services. It allows selective enabling, disabling and other commands from/to anywhere in the world. The Company's initial marketing effort will be focused on North America, with services expanded later to Europe and Asia.
The purchase was paid for with 250,000 restricted shares of common stock with a fair value of $ 25,000, a promissory note in the amount of $500,000 due January 31, 2003, and a convertible debenture in the amount of $2,000,000 with a fair value of $803,000 (maturing on January 15, 2007, coupon of 2.5% payable at the option of the holder in restricted shares of common stock). The debenture convertible into restricted common stock at a 15% discount from market, using the face value of $ 2,000,000. The due date of the note was subsequently extended to permit completion of a private placement of common stock to fund the acquisition and provide working capital. The company will also pay up to $40,000 for expenses related to the purchase.
The acquisition of C-Chip Technology has been accounted for under FASB 142 in the Pro Forma using the purchase method of accounting, allocated as follows:
Capital assets | $ | 67,725 |
Patents and trademarks | $ | 75,990 |
In Process R & D | $ | 650,000 |
C-Chip Technology | $ | 574,285 |
The In Process R & D is charged to Deficit Accumulated During the Development Stage. The convertible debenture will be accreted up to $2,000,000 over the 5 years at $59,850 per quarter.
Keystone intends to change its name to C-Chip Technologies Corporation.
On January 7, 2003 a total of 5,000,000 shares were returned to treasury and cancelled.
The Company declared a stock dividend of 19 shares of common stock for each 1 share outstanding. The record date for the stock dividend was January 20, 2003 and the shares began trading on a post-dividend basis on January 23, 2003. As of that date, the Company had a total of 25,223,960 common shares outstanding post-dividend.
All of these events are reflected in the Pro Forma Balance Sheet as at December 31, 2002.
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SIGNATURE
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 hereunto duly authorized.
Dated this 24th day of March, 2003.
| KEYSTONE MINES LIMITED |
| | |
| BY: | /s/ Stephane Solis
Stephane Solis, President and Chief Executive Officer |
| | |
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