INTERNATIONAL GEMINI TECHNOLOGY INC.
#208 — 828 Harbourside Drive,
North Vancouver, British Columbia V7P 3R9
Telephone: (604) 904-8481 Facsimile: (604) 904-9431
NOTICE
Attached are the unaudited interim financial statements of International Gemini Technology Inc.
(the “Corporation”) for the period ended June 30, 2005. The Corporation’s auditor has not reviewed
the attached financial statements.
INTERNATIONAL GEMINI TECHNOLOGY INC.
“signed”
Douglas E. Ford
Director
September 13, 2005
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INTERNATIONAL GEMINI TECHNOLOGY INC.
Consolidated Balance Sheet
Prepared by management (unaudited)
| June 30, 2005 | December 31, 2004 | |||||||||||
ASSETS | ||||||||||||
| Current assets | ||||||||||||
| Cash | $ | 176,662 | $ | 1,472 | ||||||||
| Accounts receivable | 45,000 | 52,398 | ||||||||||
| Investments | — | — | ||||||||||
| $ | 221,662 | $ | 53,870 | |||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||
| Current Liabilities | ||||||||||||
| Accounts payable and accrued liabilities | $ | 31,033 | $ | 56,897 | ||||||||
| Shareholders’ equity | ||||||||||||
| Share capital - common | $ | 12,894,609 | $ | 12,660,559 | ||||||||
| Share capital - preferred | 604,724 | 604,724 | ||||||||||
| Contributed surplus | 53,344 | 53,344 | ||||||||||
| Deficit | (13,362,048 | ) | (13,321,654 | ) | ||||||||
| 190,629 | (3,027 | ) | ||||||||||
| $ | 221,662 | $ | 53,870 | |||||||||
| Approved by the Directors: | ||||||||||||
| “Signed” | ||||||||||||
| Martin Schultz | ||||||||||||
| “Signed” | ||||||||||||
| Douglas E. Ford | ||||||||||||
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INTERNATIONAL GEMINI TECHNOLOGY INC.
Consolidated Statement of Income and Deficit
Prepared by management (unaudited)
| Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||
| 2005 | 2004 | 2005 | 2004 | |||||||||||||||||
| Revenue | ||||||||||||||||||||
| Interest Income | $ | 0 | $ | 0 | $ | 90 | $ | 0 | ||||||||||||
| Expenses | ||||||||||||||||||||
| General and administrative | 33,432 | 7,467 | 40,484 | 13,038 | ||||||||||||||||
| Income (loss) for the period | (33,432 | ) | (7,467 | ) | (40,394 | ) | (13,038 | ) | ||||||||||||
| Deficit, beginning of period | (13,328,616 | ) | (13,287,483 | ) | (13,321,654 | ) | (13,281,912 | ) | ||||||||||||
| Deficit, end of period | $ | (13,362,048 | ) | $ | (13,294,950 | ) | $ | (13,362,048 | ) | $ | (13,294,950 | ) | ||||||||
| Earnings per share | 0 | 0 | 0 | 0 | ||||||||||||||||
| Fully diluted earnings per share | 0 | 0 | 0 | 0 | ||||||||||||||||
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INTERNATIONAL GEMINI TECHNOLOGY INC.
Consolidated Statement of Cash Flow
Prepared by management (unaudited)
| Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||
| 2005 | 2004 | 2005 | 2004 | |||||||||||||||||
| Operating Activities | ||||||||||||||||||||
| Net income for period | $ | (33,432 | ) | $ | (7,467 | ) | $ | (40,394 | ) | $ | (13,038 | ) | ||||||||
| Deduct items not involving a current cash receipt | ||||||||||||||||||||
| Changes in non-cash working capital balances | (25,776 | ) | (7,454 | ) | (18,466 | ) | 11,474 | |||||||||||||
| Sale of Common Shares | 234,050 | 0 | 234,050 | — | ||||||||||||||||
| Net cash increase (decrease) in period | 174,842 | (13 | ) | 175,190 | (1,564 | ) | ||||||||||||||
| Cash position, beginning of period | 1,820 | 408 | 1,472 | 1959 | ||||||||||||||||
| Cash position, end of period | $ | 176,662 | $ | 395 | $ | 176,662 | $ | 395 | ||||||||||||
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INTERNATIONAL GEMINI TECHNOLOGY INC.
Notes to the Financial Statements
June 30, 2005
1. Continuing Operations
The Company has incurred substantial losses to date and additional losses are anticipated in future business acquisition and development. These financial statements are prepared on a going concern basis which implies the Company will continue to realize the carrying value of its assets and discharge its liabilities in the normal course of business. The financial statements do not reflect any adjustments to the carrying value of assets or liabilities that would be necessary should the Company be unable to operate as a going concern. The Company’s ability to continue as a going concern is subject to obtaining financing, acquiring or establishing business operations and ultimately on achieving profitable operations. (refer to Note 6)
| 2. | Significant Accounting Policies |
These financial statements have been prepared in accordance with accounting principles generally accepted in Canada, which conform in all material respects with those in the United States.
| 3. | Financial Instruments |
The Company’s financial instruments consist of cash, accounts receivable, and accounts payable and accrued liabilities. It is management’s opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments due to the short term to maturity. The fair value of these financial instruments approximate their carrying values.
The maximum credit risk exposure for all financial assets is the carrying value of these assets.
4. Related Party Transactions
During the six-month period ended June 30, 2005, a company in which a director has an interest charged the Company $12,000 (2004: $12000, 2003: $12,000) for rent and management fees. The unpaid portion of these amounts, plus additional advances and other amounts due to directors, aggregating $15,633 (2004: $24,080, 2003: $100,562) is included in accounts payable and accrued liabilities at June 30, 2005.
| 5. | Share Capital |
| a) | The authorized capital of the Company comprises 100,000,000 Common shares without par value and 100,000,000 Series 1 Convertible Preferred shares without par value. The rights and restrictions of the Preferred shares are as follows: |
| i) | dividends shall be paid at the discretion of the directors; |
| ii) | the holders of the Preferred shares are not entitled to vote except at meetings of the holders of the Preferred shares, where they are entitled to one vote for each Preferred Share held; |
| iii) | the shares are convertible at any time; and |
| iv) | the number of the Common shares to be received on conversion of the Preferred shares is to be determined by dividing the conversion value of the share, $1 per share, by $0.45. |
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INTERNATIONAL GEMINI TECHNOLOGY INC.
Notes to the Financial Statements (cont’d)
June 30, 2005
b) The share capital is as follows:
i) Common shares
| June 30, 2005 | June 30, 2004 | |||||||||||||||
| Shares | $ | Shares | $ | |||||||||||||
| Balance, beginning of period | 8,323,119 | 12,660,559 | 8,323,119 | 12,660,559 | ||||||||||||
| Issued for cash during the period | 1,560,333 | 234,050 | — | — | ||||||||||||
| Balance, end of period | 9,883,452 | 12,894,609 | 8,323,119 | 12,660,559 | ||||||||||||
ii) Preferred shares
| June 30, 2005 | June 30, 2004 | |||||||||||||||
| Shares | $ | Shares | $ | |||||||||||||
| Balance, end of period | 604,724 | 604,724 | 604,724 | 604,724 | ||||||||||||
| c) | The Company has arranged a non-brokered private placement to provide working capital to the Company. The Company will issue up to 2 million units at $0.15 per unit with each unit comprised of one common share and one warrant. Each warrant will entitle the holder to purchase one common share of Gemini for a term of 24 months, at a price of 18 cents per share. If the common shares of Gemini, at any time after six months after the closing date of the private placement, trade on a recognized stock exchange at a price of $0.50 per share or greater for 10 consecutive trading days, then Gemini can provide notice to the holders of the warrants and the warrants will expire 30 days after the notice is given. To date the Company has issued 1,560,333 units and raised $234,050 in connection with this financing. During the period nil preferred shares were issued; |
| d) | Nil stock options are outstanding. |
| 6. | Investments |
The Company entered into a subscription agreement to invest $200,000 into Outback Capital Inc. (dba “Pinefalls Gold”) a private Alberta company with certain directors and principal shareholders in common with the Company. Pinefalls Gold is an exploration company with mining claims located in the area of Bissett, Manitoba. The Company will invest $200,000 in exchange for 4 million units at $0.05 per unit with each unit comprised of one common share and one warrant to purchase an additional common share at $0.075 for a period of two years. Prior to exercising the warrants the Company will own approximately 37% of the common shares of Pinefalls Gold.
In addition, the Company entered into an option agreement with one of the principal shareholders of Pinefalls Gold, a director of the Company, which entitles the Company to acquire a further 3 million common shares of Pinefalls Gold in exchange for one million common shares of the Company. The option is exercisable at the Company’s discretion and it expires on March 31, 2006.
In the event that the Company exercises both the warrants and the option, the Company would own approximately 65% of the common shares of Pinefalls Gold.
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INTERNATIONAL GEMINI TECHNOLOGY INC.
Notes to the Financial Statements (cont’d)
June 30, 2005
The Company has arranged a non-brokered private placement to provide working capital to the Company. The Company will issue up to 2 million units at $0.15 per unit with each unit comprised of one common share and one warrant. Each warrant will entitle the holder to purchase one common share for a period of 24 months at $0.18 per share. To date the Company has issued 1,560,333 units and raised $234,050 in connection with this financing.
7. Directors & Officers
Edward Dolejsi, President & Director
Edward D. Ford, Vice-President & Director
Martin Schultz, Secretary & Director
John D. Stanton, Director
Douglas E. Ford, Director
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