UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to __________
Commission File Number: 333-5302-D
APEX MINERALS CORPORATION
(Exact name of Registrant as specified in charter)
Delaware 87-0543383
State or other jurisdiction of I.R.S. Employer I.D. No.
incorporation or organization
57 West 200 South, Suite 310, Salt Lake City, Utah 84101
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (801) 359-9309
Indicate by check whether the Issuer (1) has filed all reports required to be
filed by section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant
was required to file such reports), and (2) has been subject to such fling
requirements for the past 90
days. (1) Yes [X] No [ ] (2) Yes [X] No [ ]
Indicate the number of shares outstanding of each of the Issuer's classes of
common equity as of the
latest practicable date: At September 16, 1997 there were 4,750,000 shares of
the Registrant's
Common Stock outstanding.
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Consolidated Balance Sheet
ASSETS
March 31, June 30,
1997
1996
(unaudited)
(audited)
CURRENT ASSETS
Cash $ 624 $ 3,964
Prepaid mining leases (Note 1) 3,247 1,313
Total Current Assets 3,871 5,277
OTHER ASSETS
Mining claims (Note 1) 11,919 10,569
Organizational costs (Note 1) 575 696
Prepaid offering costs 3,612 -
Total Other Assets 16,106 11,265
TOTAL ASSETS $ 19,977 $ 16,542
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Consolidated Balance Sheet (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31,
June 30,
1997 1996
(unaudited)
(audited)
CURRENT LIABILITIES
Accounts payable - related party (Note 2) $ 26,100 $ 15,000
Accrued expenses 100 100
Total Current Liabilities 26,200 15,100
Minority interests 648 1,202
STOCKHOLDERS' EQUITY
Common stock, authorized 50,000,000 shares
at $.001 par value; 4,750,000 shares issued
and outstanding 4,750 4,750
Capital in excess of par value 1,863 1,863
Retained deficit (accumulated during
the development stage) (13,484) ( 6,373)
Total Stockholders' Equity (6,871) 240
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 19,977 $ 16,542
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Consolidated Unaudited Statements of Operations
For the Period
For the Three Months Ended
For the Nine Months Ended From Inception
March 31,
March 31, to March 31,
1996 1997 1996
1997 1997
REVENUE
Consulting Revenue $7,250 $ - $ 7,250 $ - $7,250
Total Revenue 7,250 - 7,250 - 7,250
EXPENSES
General and Administrative Expense 1,951 1,990 12,138 7,665
25,315
Total Expenses 1,951 1,990 12,138 7,665 25,315
OTHER INCOME (EXPENSES)
Loss attributable to minority interests - 187 - 554
602
Gain on sale of stock - - 4,129 - 4,129
- 187 4,129 554 4731
Net profit (loss) before provision
for taxes 5,299 (1,803 ) (759 ) (7,111)
(13,33 4)
Provision for Taxes (Note 1) 50 - 50 -
150
Net income (loss) $ 5,249 $(1,803 ) $ (809) $(7,111)
$(13,484)
Loss Per Share (Note 1) $- $ - $ - $ - $-
Average shares outstanding 3,500,000 4,750,000 3,366,667 4,750,000
4,054,761
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Consolidated Statements of Stockholders' Equity
Capital in
Common Stock
Excess of Retained
Minority
Shares Amount Par Value
(Deficit) Interests
Balance, July 1, 1995 - $ - $ - $ - $ -
Issuance of shares for cash
at $.001 3,300,000 3,300 - - -
Issuance of shares for services
at $.001 (Note 2) 1,300,000 1,300 - - -
Issuance of shares for services
at $.0134 (Note 2) 150,000 150 1,863 - -
Issuance of subsidiary stock for
services & state mining claims (Note 2) - - -
- - 1,250
Net (loss) for the year - - - ( 6,373
(48 )
Balance, June 30, 1996 4,750,000 $ 4,750 $ 5,992 $ ( 6,373) $
1,202
Net (loss) for the period - - - (7,111)
(55 4)
Balance, March 31, 1997 4,750,000 $ 4,750 $5,992 $(13,484
$ 648
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Consolidated Statements of Cash Flows
For the Nine For the Nine
For the Period
Months Ended Months Ended
From Inception
March 31, March 31,
to March 31, 1996 1997 1997
CASH FLOWS FROM
OPERATING ACTIVITIES
Net income (loss) $ (809) $ (7,111) $ (13,484)
Items not requiring cash flow:
Amortization 84 121 232
Mining leases 9,999 5,506 5,506
Increase in accounts payable - - 100
Issuance of stock for services 300 - 3,688
Minority share of net loss - (554) (602)
Net Cash (Used) by
Operating Activities 9,574 (2,038) (4,560)
CASH FLOWS FROM
INVESTING ACTIVITIES
Cash paid for:
Mining claims (2,069) (1,790) (11,734)
Prepaid mining leases (13,950) (7,000) (8,313)
Prepaid offering costs - (3,612) (4,169)
Net cash (used) by
Investing Activities (16,019) (12,402) (24,216)
CASH FLOWS FROM
FINANCING ACTIVITIES
Issuance of common stock 3,300 - 3,300
Loans from related parties 11,000 11,100 26,100
Net Cash provided by
Financing Activities $ 14,300 $ 11,100 $ 29,400
NET INCREASE (DECREASE) IN CASH $ 7855 $ (3,340) $ 624
CASH AT BEGINNING OF PERIOD - 3,964 -
CASH AT END OF PERIOD $ 7855 $ 624 $ 624
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Consolidated Statements of Cash Flows
For the Nine For the Nine
For the Period
Months Ended Months Ended
From Inception
March 31, March 31,
to March 31,
1996 1997 1997
Supplemental Cash Flow Information
Cash paid for:
Interest $ - $- $ -
Income taxes 50 $- $ 50
Non Cash Flow Information
Stock issued for:
Services $ 300 $- $ 3,688
Organization Costs - - 250
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Notes to the Consolidated Financial Statements
NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company was incorporated in the State of Delaware on July 10, 1995
for the
primary purpose of acquiring mining claims. In July and August 1995 the
Company
located 45 unpatented lode mining claims known as the Dix Apex #1
through #45
inclusive, in the Tutsagubet Mining District in Washington County, Utah.
An
additional 25 unpatented lode mining claims known as the Dix Apex #46
through #70
inclusive, were located in the same mining district in December 1995.
The Company's 90% owned subsidiary, Apex Minerals of Utah, Inc. (Apex
Utah) was
incorporated in June 1996 for the purpose of holding title to the Utah
mining claims.
These claims were transferred in June 1996. In November 1996, Apex Utah
purchased an additional 9 mining claims and part of a 10th mining claim
in the same
vicinity as the six Apex claims.
The Company exchanged all of its interest in the mining claims and the prepaid
mining leases for 9,000 shares of the subsidiary. Another 1,000 shares
were issued
to other parties for various services rendered and two state mining
leases (See Note
2).
In the future, the Company will recognize it's revenues from the sale of
mineral and
mining claims and may conduct studies and perform research and
consultation from
time to time.
Loss Per Share
The computations of loss per share of common stock are based on the weighted
average number of shares outstanding at the date of the financial
statements.
Provision for Income Taxes
The Company adopted Statement of Financial Standards No. 109 "Accounting for
Income taxes" in the fiscal year ended June 30, 1996.
Statement of Financial Accounting Standards No. 109 " Accounting for Income
Taxes" requires an asset and liability approach for financial accounting
and reporting
for income tax purposes. This statement recognizes (a) the amount of
taxes payable
or refundable for the current year and (b) deferred tax liabilities and
assets for future
tax consequences of events that have been recognized in the financial
statements
or tax returns.
Deferred income taxes result from temporary differences in the
recognition of
accounting transactions for tax and financial reporting purposes.
There were no
temporary differences at June 30, 1996 and earlier years; accordingly,
no deferred
tax liabilities have been recognized for all years.
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Notes to the Consolidated Financial Statements
NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Provision for Income Taxes (continued)
The Company has cumulative net operating loss carry forwards of approximately
$10,000 at June 30, 1996. No effect has been shown in the financial
statements for
the net operating loss carry forwards as the likelihood of future tax
benefit from such
net operating loss carry forwards is not presently determinable.
Accordingly, the
potential tax benefits of the net operating loss carry forwards,
estimated based upon
current tax rates of $3400 at June 30, 1996 have been offset by
valuation reserves
of the same amount. The net change in deferred tax asset and offsetting
valuation
reserve amounted to $0 for 1996.
The Company has available $10,000 in federal income tax carry forwards
that will
begin to expire in the year 2011.
Cash and Cash Equivalents
For the purposes of the statements of cash flows, cash and cash
equivalents are
defined as demand deposits at banks and certificates of deposits with
maturities less
than three months.
Consolidation
The consolidated financial statements as of June 30, 1996 and March 31, 1997
include the accounts of the parent company, Apex Minerals Corporation,
and its
majority owned subsidiary Apex Minerals of Utah, Inc. All significant
intercompany
transactions and accounts have been eliminated.
Organization Costs
Organization costs of the Company are being amortized over 60 months. Total
amortization costs for the nine months was $121.
Development Stage Company
The Company has yet to fully develop any material income from its stated
primary
objective and it is classified as a development stage company. All income,
expenses, cash flows and stock transactions are reported since inception
Mining Claims
The Company has acquired several mining claims in Washington county in
the state
of Utah. The Company has expended funds in staking the claims and
making the
proper filings with the appropriate county, state and federal agencies.
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Notes to the Consolidated Financial Statements
NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Prepaid Mining Leases
Each year, the Bureau of Land Management charges $100 per mining claim which
is to be paid in advance for the fiscal year September 1 to August 31.
The Company
has prepaid its lease on the mining claims to August 31, 1997. The
state of Utah
also charges for leases on mining claims within the state. State leases
are prepaid
through December 31, 1997.
NOTE 2 - RELATED PARTY TRANSACTIONS
During the period, an officer and shareholder has provided loans for
operating cash
for the Company. Total loans made to the Company during the nine month period
ending March 31, 1997 was $11,100. Total loans advanced since inception is
$26,100 The loans are non-interest bearing and payable on demand.
NOTE 3 - INTERIM FINANCIAL STATEMENTS
The unaudited financial statements for the three and nine months ended
March 31,
1997 were prepared from the books and records of the Company. Management
believes that all adjustments have been made to the financial statements
to make
a fair presentation of the financial condition of the Company as of
March 31, 1997.
The results of the three and nine months are not indicative of a full
year of operation
for the Company.
NOTE 4 - USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and
assumptions that
affect reported amounts of assets and liabilities, disclosure of
contingent assets and
liabilities at the date of the financial statements and revenues and
expenses during
the reporting period. In these financial statements, assets,
liabilities and earnings
involve extensive reliance on management's estimates. Actual results
could differ
from those estimates.
APEX MINERALS CORPORATION AND SUBSIDIARY
(a development stage company)
Notes to the Consolidated Financial Statements
NOTE 5 - FAIR VALUES OF FINANCIAL INSTRUMENTS
The following listing of the estimated fair value of financial
instruments is made in
accordance with the requirements of SFAS No. 107, "Disclosure About Fair Value
of Financial Instruments", The carrying amounts and fair value of the Company's
financial instruments at March 31, 1997 and June 30, 1996 are as follows:
March 31, 1997 June 31, 1996
CarryingAmountsFairCarryingAmountsFair
Values Values
Cash and Cash Equivalents$ 624$ 624$ 3964$ 3964
Accounts Payable
Including Current 26,200 25,556 15,000 14,631
Maturities
The following methods and assumptions were used by the Company
in estimating its fair value
disclosures for financial instruments:
Cash and Cash Equivalents
The carrying amounts reported on the balance sheet for cash and cash
equivalents approximate
their fair value.
Notes Payable
The fair values of notes payable are estimated using discounted cash
flow analyses (90 days)
based on the Company's incremental borrowing rate as the discount rate (10%).
APEX MINERALS CORPORATION
March 31, 1997
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The Company has had no material revenues from operations since its
inception in July 1995.
During the year ended June 30, 1996, the Company generated revenue of $7,500
from consulting
services performed by one of the officers of the Subsidiary for a local mining
company and $4,129
from the gain of sale of stock that was sold to the company by an
officer/Director. The Company has
not generated any revenue during the first nine months ended March 31, 1997.
Although the
Company may conduct studies or perform research and consulting services for
other mining
companies in the future, it is not anticipated that such revenues will be
material to the operations of
the Company.
The Company has filed an SB-2 registration with the Securities and
Exchange Commission to sell
a minimum of 300,000 ($75,000) shares and a maximum of 800,000 shares
($200,000) to the public.
Management believes that the equity funding received by the Company through
this offering, will
allow the Company to operate through August 1998. Except for the previous
loans of management
in the amount of $26,100 through March 31, 1997, the sole fixed obligation of
the Company is the
payment of the annual maintenance fees to the BLM and the State of Utah which
would equal
approximately $15,000 through August 1998. The Company does not anticipate
the need to raise
this offering are raised, the Subsidiary intends to seek additional mining
properties and/or conduct
limited geologic evaluation of the current or additional mining properties in
the form of a limited
drilling program or otherwise. Other than the purchase of office equipment
and furniture from the
funds in excess of the minimum amount raised, if any, the Company anticipates
no additional
purchases of equipment.
Management anticipates that the $17,500 allocated from the use of proceeds
from the offering will
be adequate to provide the operating capital necessary to locate a suitable
joint venture partner or
other party interested in the mining properties and to pay operating expenses
through August 1998.
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
APEX MINERALS CORPORATION
March 31, 1997
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None
(b) Reports on Form 8-K: No reports on Form 8-K were filed during the
quarter covered by this
report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant
has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
Apex Minerals
Corporation
Date: September 16, 1997 By /s/ Howard M. Oveson
Howard M. Oveson
Principal Financial Officer