UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURTIES EXCHANGE ACT OF 1934
For the period ended December 31, 2005
Commission File Number: 0-26414
GLOBETECH VENTURES CORP.
_______________________________________________________________
Box 41, Suite 1400 – 400 Burrard Street, Vancouver British Columbia, Canada V6C 2T7
_______________________________________________________________
Indicate by check mark whether the registrant files or will file annual reports under cover 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): ______
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): ______.
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to rule 12g3-2(b) under the Security Exchange Act of 1934.
Yes
[ ]
No
[ X ]
Globetech Ventures Corp. | |||||||
(An exploration stage company) | |||||||
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Consolidated Financial Statements | |||||||
(Unaudited) | |||||||
For the three months ended December 31, 2005 | |||||||
in Canadian dollars | |||||||
In accordance with National Instrument 51-102 released by the Canadian Securities Administrators, the Company discloses that its auditors have not reviewed the unaudited financial statements for the period ended December 31, 2005 | |||||||
Globetech Ventures Corp. | ||||||||
(An exploration stage company) | ||||||||
Consolidated Balance Sheets | ||||||||
(in Canadian dollars) | ||||||||
(unaudited) | ||||||||
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| December 31, 2005 | September 30, 2005 | |
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ 30,096 | $ 51,085 | ||||||
GST Refundable | 10,548 | 10,330 | ||||||
Other receivables (note 2) | - | 18,207 | ||||||
Prepaid expenses and deposits | - | 1,503 | ||||||
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| 40,644 | 81,125 | |||
Equipment (note 3) | 1,946 | 2,096 | ||||||
Mineral properties (note 4) | 50,445 | 50,407 | ||||||
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| $ 93,035 | $ 133,628 | |
LIABILITIES | ||||||||
Current Liabilities | ||||||||
Accounts payable and accrued liabilities | $ 161,023 | $ 148,496 | ||||||
Loans payable (note 6) | 260,619 | 254,211 | ||||||
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| 421,642 | 402,707 | |||
SHAREHOLDERS' DEFICIENCY | ||||||||
Capital stock | ||||||||
Authorized | ||||||||
Unlimited common shares of no par value | ||||||||
Issued and outstanding - (note 7) | 33,615,191 | 33,615,191 | ||||||
Contributed surplus | 3,008,754 | 3,008,754 | ||||||
Deficit accumulated during the exploration stage | (36,952,552) | (36,893,024) | ||||||
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(328,607) | (269,079) | |||||||
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| $ 93,035 | $ 133,628 | |
"Casey Forward" | "Dr. K. Sachdeva" | |||||||
Director | Director | |||||||
The accompanying notes form an integral part of these consolidated financial statements |
Globetech Ventures Corp. |
(An exploration stage company) | |||||||
Consolidated Statements of Operations and Deficit | |||||||
(in Canadian dollars) | |||||||
(unaudited) | |||||||
| For the three months ended December 31 | ||||||
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| 2005 | 2004 | |
Administrative expenses | |||||||
Accounting and legal | 2,180 | 21,976 | |||||
Amortization | 149 | 210 | |||||
Consulting fees | 36,000 | 54,000 | |||||
Interest and bank charges | 6,422 | 5,881 | |||||
Management fees | 7,500 | 7,500 | |||||
Office and miscellaneous | 6,000 | 4,090 | |||||
Regulatory and transfer agent fees | 1,037 | 1,138 | |||||
Telephone | 240 | 1,000 | |||||
Travel and promotion | - | 4,001 | |||||
Net loss for the period |
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| 59,528 | 99,796 | ||
Deficit, beginning of period | (36,893,024) | (36,114,171) | |||||
Deficit, end of period |
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| $(36,952,552) | $(36,213,967) | ||
Loss per share |
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| $ 0.00 | $ 0.01 | ||
Weighted average number of shares | |||||||
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| Basic and diluted |
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| 14,471,939 | 12,246,150 |
The accompanying notes form an integral part of these consolidated financial statements | |||||||
Globetech Ventures Corp. | |||||||
(An exploration stage company) | |||||||
Consolidated Statements of Shareholders' Equity (Deficiency) | |||||||
(in Canadian dollars) | |||||||
(unaudited) | |||||||
| Number of shares | Common Shares issued and fully paid | Contributed Surplus and Equity portion of convertible debentures | Deficit accumulated during the exploration stage | Total | ||
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Balance December, 1991 | - | $ - | $ - | $ - | $ - | ||
Issuance of shares for cash |
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Private placements | 1,280,001 | 159,500 | - | - | 159,500 | ||
Loss for the period | - | - | - | (32,080) | (32,080) | ||
Balance September 30, 1992 | 1,280,001 | 159,500 | - | (32,080) | 127,420 | ||
Issuance of shares for cash | |||||||
By way of prospectus | 600,000 | 360,000 | - | - | 360,000 | ||
Exercise of options | 112,000 | 67,200 | - | - | 67,200 | ||
Exercise of warrants | 100,000 | 60,000 | - | - | 60,000 | ||
Issuance of shares for property | 150,000 | 90,000 | - | - | 90,000 | ||
Share issue costs | - | (83,205) | - | - | (83,205) | ||
Loss for the year | - | - | - | (105,902) | (105,902) | ||
Balance September 30, 1993 | 2,242,001 | 653,495 | - | (137,982) | 515,513 | ||
Issuance of shares for cash |
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Private placements | 400,000 | 576,000 | - | - | 576,000 | ||
Share issue costs | - | (60,622) | - | - | (60,622) | ||
Loss for the year | - | - | - | (403,571) | (403,571) | ||
Balance September 30, 1994 | 2,642,001 | 1,168,873 | - | (541,553) | 627,320 | ||
Issuance of shares for cash |
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Private placements | 418,000 | 1,121,400 | - | - | 1,121,400 | ||
Exercise of options | 204,000 | 347,440 | - | - | 347,440 | ||
Issuance of shares for finders fees | 35,069 | 99,570 | - | - | 99,570 | ||
Share issue costs | - | (108,570) | - | - | (108,570) | ||
Loss for the year | - | - | - | (343,044) | (343,044) | ||
Balance September 30, 1995 | 3,299,070 | 2,628,713 | - | (884,597) | 1,744,116 | ||
Issuance of shares for cash |
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Private placements | 1,488,000 | 6,178,000 | - | - | 6,178,000 | ||
Exercise of options | 1,128,584 | 4,161,930 | - | - | 4,161,930 | ||
Issuance of shares for finders fees | 75,624 | 197,379 | - | - | 197,379 | ||
Share issue costs | - | (365,874) | - | - | (365,874) | ||
Loss for the year | - | - | - | (1,533,474) | (1,533,474) | ||
Balance September 30, 1996 | 5,991,278 | $ 12,800,148 | $ - | $ (2,418,071) | $ 10,382,077 | ||
The accompanying notes form an integral part of these consolidated financial statements |
Globetech Ventures Corp. | |||||||
(An exploration stage company) | |||||||
Consolidated Statements of Shareholders' Equity (Deficiency) (continued) | |||||||
(in Canadian dollars) | |||||||
(unaudited) | |||||||
| Number of shares | Common Shares issued and fully paid | Contributed Surplus and Equity portion of convertible debentures | Deficit accumulated during the exploration stage | Total | ||
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Balance forward | 5,991,278 | $ 12,800,148 | $ - | $ (2,418,071) | $ 10,382,077 | ||
Issuance of shares for cash | |||||||
Exercise of options | 243,000 | 639,730 | - | - | 639,730 | ||
�� Exercise of warrants | 845,447 | 3,696,723 | - | - | 3,696,723 | ||
Issued on conversion of debt | 2,464,950 | 4,821,079 | - | - | 4,821,079 | ||
Issuance of common shares for acquisition of subsidiary | 171,282 | 1,124,745 | - | - | 1,124,745 | ||
Issuance of shares for finders fees | 65,298 | 457,086 | - | - | 457,086 | ||
Share issue costs | - | (472,562) | - | - | (472,562) | ||
Equity portion of convertible debentures | - | - | 169,760 | - | 169,760 | ||
Loss for the period | - | - | - | (2,822,786) | (2,822,786) | ||
Balance September 30, 1997 | 9,781,255 | 23,066,949 | 169,760 | (5,240,857) | 17,995,852 | ||
Contingent consideration on acquisition of subsidiary | - | (1,086,901) | - | - | (1,086,901) | ||
Issued on conversion of debt | 277,776 | 261,679 | (59,219) | - | 202,460 | ||
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| 10,059,031 | 22,241,727 | 110,541 | (5,240,857) | 17,111,411 |
Capital stock consolidation (7.5:1) | (8,717,827) | - | - | - | - | ||
Issued on conversion of debt | 221,234 | 519,691 | (110,541) | - | 409,150 | ||
Issued on settlement of debt | 550,000 | 111,152 | - | - | 111,152 | ||
Loss for year | - | - | - | (20,236,904) | (20,236,904) | ||
Balance September 30, 1998 | 2,112,438 | 22,872,570 | (110,541) | (25,477,761) | (2,605,191) | ||
Issued on settlement of debt | 1,433,364 | 1,604,029 | - | - | 1,604,029 | ||
Loss for the year | - | - | - | (706,147) | (706,147) | ||
Balance September 30, 1999 | 3,545,802 | 24,476,599 | - | (26,183,908) | (1,707,309) | ||
Issuance of shares for cash |
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Exercise of options | 24,100 | 56,321 | - | - | 56,321 | ||
Exercise of warrants | 227,273 | 370,612 | - | - | 370,612 | ||
Issued on conversion of debt | 1,830,073 | 1,078,550 | - | - | 1,078,550 | ||
Issued on settlement of debt | 220,748 | 489,660 | - | - | 489,660 | ||
Subscriptions received in advance | - | 369,875 | - | - | 369,875 | ||
Share issue costs | - | (74,141) | - | - | (74,141) | ||
Loss for the year | - | - | - | (438,663) | (438,663) | ||
Balance September 30, 2000 | 5,847,996 | 26,767,476 | - | (26,622,571) | 144,905 | ||
Issuance of shares for cash |
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Private placement | 2,000,000 | 456,840 | - | - | 456,840 | ||
Issued for subsriptions received in advance | 227,273 | 369,875 | - | - | 369,875 | ||
Subscriptions received in advance | - | (369,875) | - | - | (369,875) | ||
Issued on acquisition of equity investment | 500,000 | 192,075 | - | - | 192,075 | ||
Issued on settlement of debt | 914,670 | 502,784 | - | - | 502,784 | ||
Share issue costs | - | (45,492) | - | - | (45,492) | ||
Loss for the year | - | - | - | (1,822,692) | (1,822,692) | ||
Balance September 30, 2001 | 9,489,939 | $ 27,873,683 | $ - | $(28,445,263) | $ (571,580) | ||
The accompanying notes form an integral part of these consolidated financial statements |
Globetech Ventures Corp. | |||||||
(An exploration stage company) | |||||||
Consolidated Statements of Shareholders' Equity (Deficiency) (continued) | |||||||
(in Canadian dollars) | |||||||
(unaudited) | |||||||
| Number of shares | Common Shares issued and fully paid | Contributed Surplus and Equity portion of convertible debentures | Deficit accumulated during the exploration stage - unaudited | Total | ||
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Balance forward | 9,489,939 | $ 27,873,683 | $ - | $(28,445,263) | $ (571,580) | ||
Loss for the year | - | - | - | (319,713) | (319,713) | ||
Balance September 30, 2002 | 9,489,939 | 27,873,683 | - | (28,764,976) | (891,293) | ||
Loss for the year | - | - | - | (47,171) | (47,171) | ||
Balance September 30, 2003 | 9,489,939 | 27,873,683 | - | (28,812,147) | (938,464) | ||
Issuance of shares for cash | |||||||
Private placements | 1,797,674 | 1,299,990 | - | - | 1,299,990 | ||
Issued on conversion of debt | 652,000 | 432,000 | - | - | 432,000 | ||
Acquisition of Brazil Gold Ltda. | 2,000,000 | 4,050,000 | - | - | 4,050,000 | ||
Share issue costs | - | (135,690) | - | - | (135,690) | ||
Contributed surplus | - | - | 2,429,100 | - | 2,429,100 | ||
Loss for the year | - | - | - | (7,302,024) | (7,302,024) | ||
Balance September 30, 2004 | 13,939,613 | 33,519,983 | 2,429,100 | (36,114,171) | (165,088) | ||
Issuance of shares for cash | |||||||
Private placement - August 4, 2004 - shares issued due to repricing clause | 302,326 | - | - | - | - | ||
Acquisition of Gladys Lake option | 50,000 | 18,504 | - | - | 18,504 | ||
Issued on conversion of debt | 180,000 | 76,704 | - | - | 76,704 | ||
Contributed surplus | - | - | 579,654 | - | 579,654 | ||
Loss for the year | - | - | - | (778,853) | (778,853) | ||
Balance September 30, 2005 | 14,471,939 | $ 33,615,191 | $ 3,008,754 | $(36,893,024) | $ (269,079) | ||
Loss for the period | - | - | - | (59,528) | (59,528) | ||
Balance December 31, 2005 | 14,471,939 | 33,615,191 | 3,008,754 | (36,952,552) | (328,607) | ||
The accompanying notes form an integral part of these consolidated financial statements |
Globetech Ventures Corp. | |||||||
(An exploration stage company) | |||||||
Consolidated Statements of Cash Flows | |||||||
(in Canadian dollars) | |||||||
(unaudited) | |||||||
| For the three months ended December 31 | ||||||
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| 2005 | 2004 | |
Operating Activities | |||||||
Net loss for the period | $ (59,528) | $ (99,796) | |||||
Items not involving cash | |||||||
Amortization | 149 | 210 | |||||
Change in non-cash working capital | |||||||
GST refundable and other receivables | 17,989 | (3,747) | |||||
Prepaid expenses and deposits | 1,503 | - | |||||
Accounts payable and accrued liabilities | 12,528 | (33,738) | |||||
Net cash used in operating activities |
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| (27,359) | (137,071) | ||
Financing Activities | |||||||
Advances from related parties | - | (36,747) | |||||
Loans payable | 6,408 | ||||||
Net cash provided from (used in) financing activities |
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| 6,408 | (36,747) | ||
Investing Activities | |||||||
Expenditures on mineral properties | (38) | - | |||||
Net cash used in investing activities |
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| (38) | - | ||
Change in cash and cash equivalents |
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| (20,989) | (173,818) | ||
Cash and cash equivalents at beginning of period | 51,085 | 304,387 | |||||
Cash and cash equivalents at end of period |
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| $ 30,096 | $ 130,569 | ||
The accompanying notes form an integral part of these consolidated financial statements | |||||||
Globetech Ventures Corp.
Notes to Consolidated Financial statements
December 31, 2005 (in Canadian dollars)
(unaudited)
1. | Nature of Operations and significant accounting policies | ||||||||||
The Company is incorporated under the laws of British Columbia, Canada, and its principal business activities included the acquiring and developing of mineral properties and the processing of related mineral resources. During the year ended September 30, 1998, the Company determined that it was not feasible to continue its mineral property operations. The Company is currently pursuing and evaluating potential business ventures in the mineral field. | |||||||||||
These interim consolidated financial statements should be read in conjunction with the audited September 30, 2005 annual financial statements. | |||||||||||
These interim financial statements follow the same accounting policies and methods of their application as in the September 30, 2005 annual financial statements. These interim consolidated financial statements do not conform in all respects to the requirements of Canadian generally accepted accounting principles for annual financial statements in that they do not include all note disclosures. | |||||||||||
The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions which affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and expenses for the periods reported. Actual results could differ from those estimates. | |||||||||||
2. | Other receivables | ||||||||||
Pursuant to a claim for unpaid legal services, an amount of $36,415 was paid into trust at the Supreme Court of British Columbia on November 24, 2004. The claim was settled in September 2005 wherein one-half of the amount was paid for legal services and the other half was returnable to the Company. The transaction was completed in October 2005. | |||||||||||
3. | Equipment | September 30, 2005 | |||||||||
| For the three months ended December 31, 2005 | ||||||||||
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| Cost | Accumulated amortization | Net book value | Net book value | |||
Office equipment | $ 5,222 | $ 4,915 | $ 307 | $ 323 | |||||||
Computer equipment | 26,313 | 24,674 | 1,639 | 1,773 | |||||||
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| $ 31,535 | $ 29,589 | $ 1,946 | $ 2,096 | |||
4. | Mineral Properties and Deferred Resource Property Expenditures | ||||||||||
On February 28, 2005, Globetech announced that it entered into an option agreement whereby the Company can earn a 100% interest in the Gladys Lake porphyry molybdenum property from Mr. John Peter Ross of Whitehorse, Yukon. The Gladys Lake property is situated in northwestern British Columbia approximately 50 km northeast of Atlin and 15 km north of the Adanac molybdenum deposit presently undergoing final engineering studies and permitting. | |||||||||||
In order to earn a 100% interest, the Company is required to pay a total of $95,000, in ascending payments over a period of four years. The agreement also calls for the issuing of 400,000 shares of Globetech over this same period. On April 12, 2005, the Company issued 50,000 shares from treasury. After the four-year period, the Company agrees to pay an annual advance royalty of $25,000 commencing February 28, 2010. On completion of a bankable feasibility, the Company will issue to the vendor a further 400,000 shares of Globetech. The vendor will retain a 3% Net Smelter Return Royalty, 2% of which can be purchased by the Company on a pro-rata basis for the sum of $2,000,000 at any time within five years of commencement of commercial production. An initial down payment of $10,000 was made. | |||||||||||
The balance of payments and schedule of share issuances is as follows: | Date | Amount | Shares | ||||||||
March 21, 2006 | $ 15,000 | 50,000 | |||||||||
March 21, 2007 | 20,000 | 50,000 | |||||||||
March 21, 2008 | 25,000 | 100,000 | |||||||||
March 21, 2009 | 25,000 | 150,000 | |||||||||
At December 31, 2005 the Company had incurred the following costs on the Gladys Lake property: |
| December 31, 2005 | September 30, 2005 | ||||||||
Acquisition costs | $ 28,504 | $ 28,504 | |||||||||
Exploration costs | |||||||||||
Report | 13,199 | 13,161 | |||||||||
Geologist | 4,000 | 4,000 | |||||||||
Transportation | 4,742 | 4,742 | |||||||||
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| Total | $ 50,445 | $ 50,407 |
Globetech Ventures Corp.
Notes to Consolidated Financial statements
December 31, 2005
(in Canadian dollars)
(unaudited)
5. | Related Parties | |||||||||||||||
The Company has entered into the following transactions with related parties: | For the three months ended December 31, 2005 | For the three months ended December 31, 2004 | ||||||||||||||
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Management fees to officers of the Company | $ 7,500 | $ 7,500 | ||||||||||||||
Included in accounts payable is $47,740 due to a director. | ||||||||||||||||
6. | Loans Payable | |||||||||||||||
Loan payable to a former related party (companies with common directors) with interest at 10% per annum due on demand, unsecured and with no fixed date of repayment. | ||||||||||||||||
7. | Share Capital | |||||||||||||||
a) | Common Shares |
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The authorized share capital of the Company is unlimited without par value. | ||||||||||||||||
The Company has issued 14,471,939 common shares of which 25,000 shares are held in escrow as at December 31, 2005. | ||||||||||||||||
b) | Stock Options | |||||||||||||||
The Company has adopted an incentive stock option plan (the "Plan"). The essential elements of the Plan provide that the agrregate number of shares of the Company's capital stock issuable pursuant to options granted under the Plan may not exceed 5,800,630 shares. Options granted under the Plan may have a maximum term of five (5) years. The exercise price of the options granted under the Plan will not be less than the fair market value of the common stock at the date of grant. The Plan Administrator shall specify the vesting schedule for each stock option granted. | ||||||||||||||||
The Company is authorized to grant options to directors, employees and consultants. Stock option transactions and the number of stock options outstanding are summarized as follows: | ||||||||||||||||
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| Number of Options | Weighted average exercise price | ||||||||||
Outstanding and exercisable at September 30, 2005 | 2,100,000 | US$ 0.54 | ||||||||||||||
Options granted | - | - | ||||||||||||||
Options cancelled / expired | - | - | ||||||||||||||
Options exercised |
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| - |
| - | |||||||||
Outstanding and exercisable at December 31, 2005 |
| 2,100,000 |
| US$ 0.54 | ||||||||||||
The Company had 2,100,000 stock options of which 1,700,000 were granted on February 3, 2005 that expire on February 3, 2008 and 400,000 were granted on March 12, 2004, expiring on March 12, 2008. | ||||||||||||||||
c) | Warrants |
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At December 31, 2005, the Company had 2,100,000 (2004 - 2,100,000) common share purchase warrants outstanding to purchase 2,100,000 common shares of the Company. | ||||||||||||||||
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| Issue date | Warrants outstanding | Purchase price | Expiry date | ||||||||||
June 30, 2004 | 300,000 | USD $ 0.90 | 30-Jun-06 | |||||||||||||
USD $ 1.00 | 30-Jun-07 | |||||||||||||||
April 23, 2004 | 300,000 | USD $ 0.90 | 23-Apr-06 | |||||||||||||
USD $ 1.00 | 23-Apr-07 | |||||||||||||||
June 30, 2004 | 500,000 | USD $ 0.60 | 30-Jun-06 | |||||||||||||
July 28, 2004 | 1,000,000 | USD $ 0.475 | 28-Mar-06 | |||||||||||||
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8. | Contingencies The Company has made a demand for the return of 2,000,000 shares issued in connection with the Amapa property due to breach of the contract. The Company is of the opinion that the breaches incurred by the defendants occurred before any non-performance of the contract on its part and that it should able to exercise its rights under the contract to repurchase the 2,000,000 shares issued for $100.00. The outcome is not determinable. | |||||||||||||||
GLOBETECH VENTURES CORP.
Management Discussion and Analysis
For the Three Months Ended December 31, 2005
This "Management’s Discussion and Analysis" has been prepared as of February 26, 2006 and should be read in conjunction with the unaudited consolidated financial statements of the Company for the three months ended December 31, 2005.
The Company
Globetech Ventures Corp. (“Globetech” or the “Company”), a public company listed on the OTC Bulletin Board under the symbol GTVCF, was incorporated under the laws of the Province of British Columbia on November 20, 1991 under the name Universal Enterprises Corp. The Company then changed its name to Colossal Resources Corp. on August 17, 1992 and became a reporting issuer with its shares listed for trading on the Vancouver Stock Exchange under the symbol CLP. On February 24, 1997 the Company voluntarily de-listed its shares from the Vancouver Stock Exchange and its shares were listed for trading on the NASDAQ Small Cap Exchange under the symbol CLPZF on April 3, 1996. On July 28, 1998 the Company’s shares were de-listed from the NASDAQ Small Cap Exchange for failing to maintain a bid price of not less than US$1.00 per share. The Company subsequently listed its shares for tr ading on the OTC Bulletin Board under the symbol CLPZF. On September 20, 2000 the Company changed its name to Globetech Ventures Corp. with a new trading symbol of GTVCF.
The Company’s head office and principal place of business is located at Suite 1400 – 400 Burrard Street, Vancouver, BC, V6C 3G2.
Business of the Company
Globetech’s principal business activities include the acquiring and exploration of mineral properties and the processing of related mineral resources.
On February 28, 2005, Globetech entered into an option agreement whereby the Company can earn a 100% interest in the Gladys Lake porphyry molybdenum property from Mr. John Peter Ross of Whitehorse, Yukon. The Gladys Lake property is situated in northwestern British Columbia approximately 50 km northeast of Atlin and 15 km north of the Adanac molybdenum deposit presently undergoing final engineering studies and permitting.
In order to earn a 100% interest, the Company is required to pay a total of $95,000, in ascending payments over a period of four years. The agreement also calls for the issuing of 400,000 shares of Globetech over this same period. After the four-year period, the Company agrees to pay an annual advance royalty of $25,000 commencing February 28, 2010. On completion of a bankable feasibility, the Company will issue to the vendor a further 400,000 shares of Globetech. The vendor will retain a 3% Net Smelter Return Royalty, 2% of which can be purchased by the Company on a pro-rata basis for the sum of $2,000,000 at any time within five years of commencement of commercial production. The qualified person as defined by NI 43-101 for this news release is John Kowalchuk, P.Geo. Exploration Manager.
The Gladys Lake molybdenite deposit lies about 2 to 3 kilometres south of the west end of Gladys Lake approximately 50 kilometres northeast of the town of Atlin, British Columbia. The deposit received extensive work by Amax Explorations Ltd. in 1970 and 1971 when geological and geochemical surveys, trenching and 726 metres of diamond drilling were completed. The drill results were not documented for assessment work.
In 1978, Quest Explorations Ltd. recovered the drill core, logged and assayed the core. The results are shown in the table below.
The property is underlain by a sequence of sediments of the Late Paleozoic Cache Creek Group. These rocks are intruded by small bodies of Late Mesozoic alaskite. The alaskite consists of a ring-dyke complex exposed at higher elevations and a probable large stock-like body at depth. Roughly centered about the alaskite is a quartz vein stockwork zone lying within a larger zone of weakly to intensely altered rocks. The alaskite complex has an outer diameter ranging from 500 m (1600 feet) to 700 m (2300 feet).
The hornfelsed and altered zones are both roughly centered about the alaskite outcrop. The hornfels measures approximately 3500 m (11,500 feet) and 2000 m (6,600 feet) respectively. The wallrock alteration zone lies within the hornfelsed zone and has an elliptical shape with the long axis being approximately 2500 m (8200 feet) and the short axis being 1500 m (5000 feet). The wallrock alteration zone is characterized by pervasive weak to intense degrees of bleaching and silicification with attendant development of sericite occurring along fractures and disseminated along margins of quartz veins.
Quartz veining occurs widespread throughout the alteration zone with sedimentary rocks and alaskite. Veins commonly range from 1/8 in to ¾ in wide and are relatively continuous and sharp walled. The quartz vein stockwork zone is roughly centered about the alaskite ring dyke complex.
Sulphide minerals recognized on the property include pyrite, molybdenite, chalcopyrite and pyrrhotite. Very minor amounts of scheelite and wolframite have been observed Molybdenite occurs as medium grained flakes, books and rosettes along margins of quartz veins within the stockwork zone and in most of the stringer zones. Also fine-grained molybdenite occurs along dry fractures within the stockwork zone.
The geochemistry survey completed by AMAX in 1970 produced an anomalous target 1200 m (4000 feet) by 800 m (2700 feet). This soil geochemical anomaly outlines the trace of the main molybdenum mineralization in the quartz stockwork zone.
Surface rock sampling from outcrop and trenching gave range from 0.02% to 0.05% MoS2. Core sampling, supervised by R.H. Seraphim, Ph.D., P.Eng. in 1978, gave the following values:
Hole 1
220’ to 401’
181’
0.110% MoS2.
Hole 2
200’ to 586’
386’
0.089% MoS2
Hole 3
72’ to 175’
103’
0.051% MoS2
332’ to 490’
158’
0.022% MoS2
Hole 4
not sampled
Hole 5
520’ to 556’
36’
0.087% MoS2
These drill hole assays are historical data and have not been verified by the Company’s qualified person and are not 43-101 compliant. They were obtained from the assessment records held by the Government of British Columbia and the reputation of the Geologist R. H. Seraphim would suggest that it is reliable, however because it was not completed under the rigors of NI 43-101 it must only be viewed as historical data. The Company will be contracting an independent Qualified Person to visit the property and prepare a NI 43-101 report on the project.
The Gladys Lake property hosts a molybdenum deposit similar in tenor and size to the Adanac Deposit to the south. The property has an excellent anomalous soil footprint and weakly mineralized surface showings of molybdenite. Limited diamond drilling suggests that the grade of the mineralization is similar to that at Adanac with grades ranging from 0.05 to 0.1% MoS2.
Molybdenum is a metallic element which is most frequently used as an alloying addition in stainless steels. It enhances the strength, hardenability, weldability, toughness and corrosion resistance. After more than 20 years of low molybdenum prices, molybdenum has finally come into its own with present prices moving from
US$4.00 per pound Mo in 2003 to US$20 per pound Mo to US$30 per pound Mo in early 2005. Much of this price rise is related to increases in markets and shortage of supply. China, which has a huge shortage of supply, has been the major cause of this meteoric rise in price. Regardless of the recent very high prices; low metal stockpiles and extensive international pipeline construction projects are likely to keep long term prices for molybdenum above US$10 per pound Mo.
Previously the Company had planned on an exploration program on a mineral property in Brazil. This property has been written off as at September 30, 2004 and the Company has no further interest in pursuing this property.
Selected Annual Information
The following information is derived from the consolidated financial statements of the Company for each of the three years ended September 30, 2005, 2004 and 2003.
Year Ended, September 30, 2005 | Year Ended, September 30, 2004 | Year Ended, September 30, 2003 | |
Total Revenues | $NIL | $NIL | $NIL |
Net income (loss) per share, basic and fully diluted | (0.05) | (0.60) | (0.00) |
Total Assets | 133,628 | 309,598 | 19,021 |
Long Term Liabilities | NIL | NIL | NIL |
Cash dividends declared | NIL | NIL | NIL |
Number of securities outstanding | 14,471,939 | 13,939,613 | 9,489,939 |
Results of Operations
For the three months ended December 31, 2005, the Company had a net loss of $59,528 compared to a net loss of $99,796 for the comparable period ended December 31, 2004. The main differences were accounting and legal at $2,180 expensed in the current quarter compared to $21,976 in the previous year and consulting fees of $36,000 in the current quarter as compared to $54,000 in the previous year.
The increase in accounting and legal reflects the start of some lawsuits in December 2004. The Company was sued by a law firm in the United States for refusing to pay their bill. This case was settled in September 2005 with the flow of funds taking place in October 2005. An amount of $36,414 had been placed into court representing the amount required to satisfy the United States law firm, which after settlement with the Company was split 50-50. The Company received $18,207 from court in October 2005. This matter is closed.
In addition to this lawsuit, in regards to the Amapa property in Brazil that the Company was previously involved in, the Company is trying to cancel two million shares issued pursuant to the Amapa agreement. The Company believes that these shares should be cancelled, and is prepared to take whatever action is necessary.
On January 24, 2005 the Company announced that it was no longer pursing any exploration or development work on the Amapa property. It was decided that the environment was too difficult to work within and that results found could be of a very preliminary nature with a potential for a high cost of exploration. This write-down of $4,425,208 was taken in the previous year.
The Company has incurred $36,000 in consulting fees to find an additional mining project. Although several projects have been looked at no negotiations have taken place yet to make any acquisitions.
The Company has taken on the Gladys Lake property and recently completed a geological report. The Company intends to complete a proposed Phase 1 work program of $50,000 and if warranted the Phase 2 program of $125,000.
Summary of Quarterly Results
Results for the eight most recently completed quarters are summarized as follows:
Total revenues | Income (loss) before other items | Net Income (loss) for the period | Net income (loss) per share (basic and diluted) | |
December 31, 2005 | NIL | $ (59,528) | $ (59,528) | $ (0.00) |
September 30, 2005 | NIL | 70,768 | 68,084 | 0.01 |
June 30, 2005 | NIL | (37,046) | (44,531) | (0.00) |
March 31, 2005 | NIL | (702,610) | (702,610) | (0.06) |
December 31, 2004 | NIL | (99,796) | (99,796) | (0.00) |
September 30, 2004 | NIL | (850,613) | (5,180,203) | (0.40) |
June 30, 2004 | NIL | (204,916) | (204,376) | (0.02) |
March 31, 2004 | NIL | (1,878,748) | (1,879,038) | (0.20) |
Liquidity and Capital Resources
At December 31, 2005, the Company had $30,096 in cash with a working capital deficiency of
$380,998. The Company has not issued any securities in the current quarter. The Company plans to issue some equity shares for debt and/or cash in order to carry on its objectives.
We may encounter lower than anticipated opportunities to raise equity funding, higher than anticipated expenses, or opportunities for acquisitions of other business initiatives that require significant cash commitments, or other unanticipated problems or expenses that could result in a requirement for additional capital before that time. If we need to raise additional cash, financing may not be available to us on favorable terms, or at all. We have several share purchase warrants outstanding and we will endeavor to have some of these exercised.
Sales and Marketing
There are no specific sales and marketing plans currently undertaken. The Company has recently found a mining property to explore, and may undertake some public relations campaigns. The Company is currently developing a marketing strategy.
Subsequent Events
Nil
Off-Balance Sheet Arrangements
The Company has not entered any off-balance sheet arrangements.
Critical Accounting Estimates
The preparation of financial statements in conformity with Canadian GAAP requires the Company to select from possible alternative accounting principles, and to make estimates and assumptions that determine the reported amounts of assets and liabilities at the balance sheet date, and reported costs and expenditures during the reporting period. Estimates and
assumptions may be revised as new information is obtained, and are subject to change. The Company’s accounting policies and estimates used in the preparation of the financial statements are considered appropriate in the circumstances, but are subject to judgments and uncertainties inherent in the financial reporting process.
The Company follows accounting guidelines in determining the fair value of stock-based compensation. This calculated amount is not based on historical cost, but is derived based on subjective assumptions input into an option-pricing mode. The model requires that management made several assumptions as to future events: 1) estimate the average future hold period of issued stock options before exercise, expiry or cancellation; 2) future volatility of the Company’s share price in the expected hold period (using historical volatility as a reference); 3) and the appropriate risk-free rate of interest. The resulting value calculated is not necessarily the value which the holder of the option could receive in an arm’s length transaction, given that there is no market for the options and they are not transferable. It is management’s view that the value derived is highly subjective and dependent entirely upon the inp ut assumptions made.
Changes in Accounting Policies including Initial Adoption
Nil
Financial Instruments and Other Instruments
The fair values of cash, accounts receivable, accounts payable and accrued liabilities and loans payable approximate their carrying values due to the short term or demand nature of these instruments. It is management's opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments.
Directors and Officers
Casey Forward
-
CEO, CFO and director
Dr. Kanwal Sachdeva
-
Director
Dr. Arnold Abramson
-
Director
Signatures
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.
GLOBETECH VENTURES CORP.
By: /s/ “Casey Forward”__________
Casey Forward, CEO, CFO and director
March 1, 2006