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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB/A
QUARTERLY REPORT UNDER
Section 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
June 30, 2002
==============================================================================
McKenzie Bay International, Ltd.
(Name of Small Business Issuer in its Charter)
Delaware
(State or other Jurisdiction of Incorporation or Organization)
[51-0386871]
(IRS Employer Identification No.)
3362 Moraine Drive, Brighton, Michigan 48114
(Address of Principal Executive Offices/Zip Code)
(810) 220-5948
(Issuer's telephone number, including area code)
Securities outstanding as of June 30, 2002
21,352,437 Common shares $.01 Par Value
==============================================================================
TABLE OF CONTENTS PAGE
PART I - FINANCIAL INFORMATION............................................1
ITEM 1. FINANCIAL STATEMENTS......................................F-1 - F-8
ITEM 2. PLAN OF OPERATION...............................................2-5
PART II - OTHER INFORMATION................................................6
ITEM 1. LEGAL PROCEEDINGS.................................................6
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.........................6
ITEM 3. DEFAULTS UPON SENIOR SECURITIES...................................6
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...............6
ITEM 5. OTHER INFORMATION.................................................6
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K..................................6
SIGNATURES.................................................................7
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
TABLE OF CONTENTS FOR INTERN FINANCIAL STATEMENTS PAGE
BALANCE SHEETS as of June 30, 2002 (Unaudited)...........................F-1
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
for three month periods ending June 30, 2002 (Unaudited).................F-2
CONSOLIDATED STATEMENT OF LOSS for three month periods ending
June 30, 2002 and June 30, 2001 and for the nine month periods
ending June 30, 2002 and June 30, 2001(Unaudited)........................F-3
STATEMENT OF CASH FLOWS for three month periods ending June 30,
2002 and June 30, 2001 and for the nine month period
ending June 30 2002 and June 30, 2001(Unaudited).........................F-4
NOTES TO THE FINANCIAL STATEMENTS.................................F-5 to F-7
1
PART I ---FINANCIAL INFORMATION
Item 1. Financial Statements
MCKENZIE BAY INTERNATIONAL LTD.
SECOND QUARTER INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited - See Notice to Reader)
June 30, 2002
NOTICE TO READER
We have compiled the second quarter interim consolidated balance sheet of
McKenzie Bay International Ltd. as at June 30, 2002 and the interim
consolidated statements of changes in shareholders' equity, loss and cash flows
for the three months then ended 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/ Zaritsky Penny LLP
London, Ontario, Canada Chartered Accountants
August 1, 2002
MCKENZIE BAY INTERNATIONAL LTD.
SECOND QUARTER INTERIM CONSOLIDATED BALANCE SHEET
(Unaudited - See Notice to Reader)
JUNE 30, 2002
(Amounts stated in US dollars)
<table>
<caption>
<s> <c> <c>
JUNE 30, September 30,
2002 2001
ASSETS
Current:
Cash and cash equivalents $ 271,862 $ 654,186
Marketable securities (note 2) 358,162 1,767,835
Accounts receivable 46,640 84,438
Prepaid expenses and deposits 20,514 44,443
697,178 2,550,902
Reclamation cash bond 338,685 338,685
Capital assets (note 3) 90,205 103,375
Goodwill 177,188 -
Incorporation and reorganization costs, net 42,931 49,137
$ 1,346,187 $3,042,099
LIABILITIES & STOCKHOLDERS' EQUITY
Current:
Accounts payable and accrued liabilities $ 1,636,133 $ 748,440
Convertible notes payable - 23,055
Current portion of long-term debt 48,482 32,794
1,684,615 804,289
Long-term debt (note 4) 74,120 69,101
Government assistance (note 5) 889,244 -
Reclamation and closure liabilities 250,000 250,000
2,897,979 1,123,390
Stockholders' equity
Capital stock (note 4) -
75,000,000 common stock authorized,
at $0.001 par value
21,352,437 common stock issued and
outstanding 21,270 20,408
Paid in capital (note 4) 10,741,515 9,729,027
Accumulated deficit (12,257,921) (7,813,194)
Foreign currency translation adjustment (56,656) (17,532)
(1,551,792) 1,918,709
$ 1,346,187 $ 3,042,099
</table>
F-1
(See accompanying notes)
MCKENZIE BAY INTERNATIONAL LTD.
THIRD QUARTER INTERIM CONSOLIDATED STATEMENT OF
CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited - See Notice to Reader)
THREE MONTHS ENDED JUNE 30, 2002
(Amounts stated in US dollars)
<table>
<caption>
<s> <c> <c> <c> <c> <c>
Foreign
currency Total
Common Paid in Accumulated translation stockholders'
shares capital Deficit adjustment equity
--------- ------------ ------------ ---------- ------------
Balance, beginning
of quarter $ 20,680 $ 10,072,644 $(11,352,493) $ (18,472) $(1,277,641)
Issuance of common stock 590 668,871 - - 699,461
Net loss for the quarter - - (905,428) (905,428)
Change in foreign
currency translation
adjustment - - - (38,184) (38,184)
--------- ------------ ------------ ---------- ------------
Balance, end of quarter $ 21,270 $ 10,741,6515 $(12,257,921) $ (56,656) $(1,551,792)
(See accompanying notes)
</table>
F-2
MCKENZIE BAY INTERNATIONAL LTD.
SECOND QUARTER INTERIM CONSOLIDATED STATEMENT OF LOSS
(Unaudited - See Notice to Reader)
THREE MONTHS ENDED JUNE 30, 2002
(Amounts stated in US dollars)
<table>
<caption>
<s> <c> <c> <c> <c>
Three months ended June 30, Nine months ended June 30,
2002 2001 2002 2001
------------ ---------- ----------- -----------
Revenue $ 49,423 $ - $ 55,494 $ -
------------ ---------- ----------- -----------
Expenses:
Exploration expenditures, net
of grants received 386,271 318,208 2,120,748 336,503
Management salaries 135,290 - 313,748 -
General administration 107,878 20,687 322,843 109,994
Professional fees 91,075 59,222 194,861 86,230
Wages and benefits 68,318 100,181 351,332 266,764
Advertising, promotion and travel 66,079 54,009 149,480 98,002
Amortization 7,259 86,524 21,801 271,322
Interest on long-term debt 4,608 35,731 9,277 42,176
Property taxes (1,266) - 11,318 7,915
Interest on convertible notes payable - - - 300
865,515 674,562 3,495,408 1,219,206
------------ ---------- ----------- -----------
Loss before the following: (816,092) (674,562) (3,439,914) (1,219,206)
Write-down of assets (16,464) - (28,164) -
Write-down of marketable
securites(note 2) (79,000) - (837,469) -
Gain(Loss) on sale of marketable securites 5,999 - (142,145) -
Interest income 129 5,262 2,964 5,780
------------ ---------- ----------- -----------
Net loss for the period $ (905,428) $ (669,300) $(4,444,727) $(1,213,426)
------------ ---------- ----------- -----------
Loss per share $(0.042) $(0.036) $(0.208) $(0.065)
Shares outstanding 21,352,437 18,547,942 21,352,437 18,547,942
(See accompanying notes)
</table>
F-3
MCKENZIE BAY INTERNATIONAL LTD.
SECOND QUARTER INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited - See Notice to Reader)
THREE MONTHS ENDED JUNE 30, 2002
(Amounts stated in US dollars)
<table>
<caption>
<s> <c> <c> <c> <c>
Three months ended June 30, Nine months ended June 30,
2002 2001 2002 2001
------------ ---------- ----------- -----------
Cash flows provided by (used in):
Operating activities:
Net loss for the period $ (905,428) $ (669,300) $(4,444,727) $(1,213,426)
Items not affecting cash
Amortization 7,259 86,524 21,801 271,322
Reclamation and closure liabilities - 225,000 - 225,000
Write-down of assets 16,464 - 28,164 -
Write-down of marketable Securities 79,000 - 837,468 -
Loss(gain) on sale of marketable
securities (5,999) - 142,145 -
Net change in non-cash working
capital balances (note 7) 475 (423,079) 949,420 (758,584)
(808,229) (780,855) (2,465,729) (1,475,688)
Financing activities:
Decrease in convertible notes payable (23,055) - (23,055) (10,600)
Proceeds from long-term debt 87,660 - 934,244 -
Payment of long-term debt (8,296) (7,463) (24,293) (21,856)
Proceeds from issuance of common stock 669,461 2,538,933 1,017,719 3,656,613
Purchase of common stock for treasury - (53,564) (4,369) (53,564)
725,770 2,477,906 1,900,246 3,570,593
Investing activities:
Purchase of marketable securities - (1,384,400) - (1,384,400)
Proceeds-sale of marketable securities 136,100 - 430,060 -
Purchase of capital assets (18,299) - (29,999) (46,910)
Purchase of reclamation cash bond - (338,658) - (338,658)
Purchase of goodwill - - (177,188) -
177,801 (1,723,085) 222,873 (1,769,995)
Effect of foreign currency
exchange rate changes on cash (38,184) 2,314 (39,714) 832
Net change in cash for the period (2,842) (23,720) (382,324) 325,742
Cash (bank indebtedness), beginning
of period 274,704 332,175 654,186 (17,287)
Cash, end of period $ 271,862 $ 308,455 $ 271,862 $ 308,455
(See accompanying notes)
</table>
F-4
MCKENZIE BAY INTERNATIONAL LTD.
NOTES TO THE THIRD QUARTER INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited- See Notice to Reader)
JUNE 30, 2002
(Amounts stated in US dollars unless indicated otherwise)
1. Basis of presentation
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three month period ending June 30, 2002, are not
necessarily indicative of the results that may be expected for the year ended
September 30, 2002. For further information, refer to the financial statements
and footnotes thereto included in the Company's audited financial statements for
the year ended September 30, 2001.
2. Marketable securities
Marketable securities consist of 877,000 common shares of Vanteck (VRB)
Technology Corp. At the end of the quarter, the securities were written down by
$79,000 to market value of $358,162.
3. Capital assets
<table>
<caption>
<s> <c> <c> <c> <c>
June 30, Sep. 30,
2002 2001
----------- -----------
Accumulated Net Book Net Book
Cost Amortization Value Value
----------- ------------ ----------- -----------
Processing equipment $ 1,735,962 $ 267,351 $ 1,468,611 $ 1,458,311
Building 175,389 8,396 166,993 166,993
Equipment under capital lease 137,435 52,435 85,000 100,000
Furniture and fixtures 7,253 1,945 5,308 3,838
Computer 3,203 2,077 1,125 730
Office equipment 569 280 289 324
----------- ------------ ----------- -----------
2,077,674 332,484 1,745,190 1,730,196
Less write-down (1,914,521) (276,000) (1,654,985) (1,626,821)
----------- ------------ ----------- -----------
$ 146,689 $ 56,484 $ 90,205 $ 103,375
</table>
F-5
4. Long-term debt
Long-term debt consists of the following:
Obligation under capital lease, payable in blended
monthly instalments of $3,444, interest at 10%, due
July, 2004 Bank term loan, $ 77,602
payable in blended monthly instalments of $1,413,
interest at 8%, due June, 2005 45,000
---------
122,602
Less current portion 48,482
---------
$ 74,120
The company has provided equipment subject to the lease agreement above as
collateral for amounts owing.
5. Repayable government assistance
A subsidiary, McKenzie Bay Resources Ltd., received financial assistance
from the governments of Canada and the Province of Quebec towards the completion
of a feasibility study of the Vanadium deposit at Lac Dore. Both of these
financial assistance packages have been recorded as liabilities in these
financial statements.
Province of Quebec financial assistance repayable in scheduled
payments over 4 years after the second year of production of
the mine. This assistance is forgivable if, after 24 months
following the release of the feasibility study, a decision is
made not to begin production. $592,830
Government of Canada financial assistance is repayable in two
equal consecutive payments of CDN$250,000 each commencing 24
months after the completion of the feasibility study. 296,414
6. Capital stock
Authorized -
75,000,000 common shares, par value $0.001 per share
<table>
<caption>
<s> <c> <c> <c> <c>
Issued - Common Paid in
Shares stock Capital Total
----------------------------------------------------
Balance, beginning of quarter 20,762,275 $ 20,762 $ 10,222,184 $ 10,242,946
Common stock issued for cash 590,162 590 668,871 669,461
----------------------------------------------------
21,352,437 21,352 10,891,055 10,912,406
Less treasury stock at cost (82,000) (82) (149,540) (149,622)
---------------------------------------------------------------------------------------
Balance, end of year 21,270,437 $ 21,270 $ 10,741,515 $ 10,762,785
=======================================================================================
</table>
F-6
7. Net change in non-cash working capital balances related to operations
The net change in non-cash working capital balances are as follows:
<table>
<caption>
<s> <c> <c> <c> <c>
-------------------------------------------------------
Three months ended June 30, Nine months ended June 30,
2002 2001 2002 2001
-------------------------------------------------------
Accounts receivable $ 129,434 $ (121,965) $ 37,798 $(120,689)
Prepaid expenses 4,099 (40,174) 23,929 (31,469)
Accounts payable and
accrued liabilities (133,058) (260,940) 887,693 (606,426)
---------------------------------------------------------------------------------------
$ 475 $ (423,079) $ 949,420 $ (758,584)
========================================================
</table>
8. Kelsey Lake Diamond Mine
[a] Sale of Kelsey Lake Diamond Mine
On September 11, 2000, the company undertook to re-evaluate the diamond
processing operations and adopted a formal plan to dispose of the Kelsey Lake
Diamond Mine.
On September 6, 2001, the company entered into a sale agreement whereby the
company, through its wholly owned subsidiary, Great Western Diamond Company,
agreed to sell the Kelsey Lake Diamond Mine.
During the last quarter, the purchaser opted not to acquire the Kelsey Lake
Diamond Mine. As a result, approximately $1,329,000 of accounts payable owing
to the purchaser will be satisfied through the issuance of McKenzie Bay
International Ltd. common stock based on a purchase price of 60% of the
preceding 30 day average trading price as per the agreement.
[b] Write-down of Kelsey Lake Diamond Mine assets
Given the nature of the Kelsey Lake mine assets, management has written down the
carrying value of the assets as follows:
Carrying value of mine assets before write-down $1,739,985
Less write-down 1,654,985
Carrying value of mine assets after write-down $ 85,000
Any gains and losses resulting from the eventual sale of the mine assets will be
recognized in the period of sale.
F-7
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Section 21E of the Securities Exchange Act of 1934 provides a "safe harbor" for
forward-looking statements. Certain information included herein contains
statements that are forward-looking, such a statements regarding management's
expectations about future production and development activities as well as other
capital spending, financing sources and the effects of regulation. Such forward-
looking information involves important risks and uncertainties that could
significantly affect anticipated results in the future and, accordingly, such
results may differ from those expressed in any forward-looking statements made
herein. These risks and uncertainties include, but are not limited to, those
relating to the market price of metals, production rates, production costs, the
availability of financing, the ability to obtain and maintain all of the permits
necessary to put and keep properties in production, development and construction
activities and dependence on existing management. The Company cautions readers
not to place undue reliance on any such forward-looking statements, and such
statements speak only as of the date made.
RESULTS OF OPERATIONS
Operating revenue was $49,423 for the quarter ended June 30, 2002 compared with
none for 2001. Revenues were from consulting fees generated by Dermond inc, as
part of Electricity Management Systems "EMS" activities. Most Company activities
have been directed toward development activities on the Lac Dore Vanadium
deposit near Chibougamau, Quebec, Canada. Activities at the Kelsey Lake Diamond
Mine were to seek a buyer for the mine.
Development costs have been incurred in connection with Lac Dore. These costs
have been incurred for preparation of a Feasibility Study to determine the
viability of constructing a mine, refinery and manufacturing facility for the
production of Vanadium oxides. Other costs were incurred at Kelsey Lake to
demonstrate the viability of mining diamonds to potential buyers.
Operating expenses totaled $816,092 for the quarter ended June 30, 2002 compared
with $674,562 for 2001. The Company reported a net loss of $905,428 for the
quarter compared with a net loss of $669,300 for 2001.
<PAGR>2
RECENT DEVELOPMENTS
Lac Dore
MKBY is rapidly executing its corporate strategy that places strong emphasis on
creating significant downstream shareholder value opportunities by identifying
and exploiting markets for products where Vanadium is a strategic component. The
Company has achieved several significant milestones towards the execution of its
business plan in the quarter ended June 30, 2002.
On April 23, 2002 the Company announced the results of a Feasibility Study
"Study" performed on Lac Dore. The Study, prepared by engineering firm SNC
Lavalin Inc "SNC", recommended continued development of a mine, refinery and
product manufacturing facility.
The Study indicates Lac Dore is capable of producing large quantities of high
purity Vanadium products. Capital investment is estimated at US$229 {C$364}
million including all equipment, infrastructure costs and C$39 million for
contingencies providing for initial annual production capacity of 25 million
pounds for all Vanadium products combined. Total employment is estimated at
300. SNC's financial analysis indicates a very good Internal Rate of Return of
29.6% based on 30% Equity.
A new process technology developed by SNC in collaboration with Savanco and
Lakefield Research will produce high purity Vanadium oxides. MKBY is preparing
patent applications for this new process technology. This new process technology
is expected to enable Lac Dore to become the lowest cost producer in the world
of various high purity Vanadium oxides.
On June 20, 2002, MKBY announced its wholly owned subsidiary, McKenzie Bay
Resources Ltd, and SOQUEM INC {http://www.soquem.qc.ca}, a division of SGF
Mineral Inc, which is a subsidiary of Societe generale de financement du Quebec
"SGF" {Ministry of Finance Province of Quebec} signed a Letter of Intent to
negotiate a Joint Venture "J/V" Agreement between the parties in which SOQUEM
would exercise its option to retain a 20% interest in the Lac Dore vanadium
deposit.
The final Agreement would represent an important first step towards financing
the construction of a mine, refinery and product manufacturing facility. A
SOQUEM J/V significantly enhances the credibility of the development project
greatly supporting efforts to secure the balance of funding required.
The first step towards development of Lac Dore was taken (Exhbit99.03- July 24,
2002) when Entraco Inc, a Montreal based environmental consulting firm, has been
re-engaged to begin the environmental impact study and secure necessary permits
to construct the required facilities. Entraco was instructed to apply the same
high environmental standards established when previously engaged for preparation
of the Feasibility Study minimizing any unanticipated environmental constraints.
Another important step towards development of Lac Dore is securing contracts for
the lease or sale of Lac Dore's Vanadium products. MKBY is actively engaged in
the discovery of markets, products and demand for five Vanadium products
targeted specifically for their use in electricity storage technologies. These
products offer: high profit margin potential, limited or non-existent
competition, and strong likelihood for creation of significant downstream values
from leasing.
3
Leasing of Vanadium products is the focus of the Company to create significant
downstream values for our shareholders. Vanadium Electrolyte, for use in
Vanadium Redox Batteries is one product targeted for leasing. Another
electricity storage technology utilizing a different Vanadium oxide is strongly
being pursued as a second lease product. A strategic alliance is under
negotiation with the inventor of this technology. Strategic alliances for other
segments of the Company's business activities are being discussed with several
interested parties.
The final pre-construction engineering phase will begin shortly, subsequent to
securing contracts for the sale of products to be produced at Lac Dore. Plans
are currently being prepared and appropriate engineering firms will be engaged
to render these services and those of the related construction phase.
In preparation for products to be produced from Lac Dore, plans are being made
to begin Vanadium Electrolyte production from a pilot plant facility located in
Canada utilizing vanadium from alternative sources until Lac Dore begins
production. Pilot production of Lac Dore's four other targeted Vanadium
products are also being considered.
Pilot production simultaneously proves and optimizes the new recovery process
while helping to establish markets for new Vanadium oriented electricity
technologies. This intermediate step is important in creating future demand for
Lac Dore products. Lac Dore becomes an expansion phase from pilot production as
demand is created for products needed to supply new electricity technologies
markets. With pilot production, MKBY will generate revenues as early as next
year.
Significant developmental milestones for MKBY have been achieved and other
important activities are moving forward with good velocity and direction as of
June 30. Management continues to be confident that timelines for completion of
critical elements of MKBY's business plan are on schedule.
The discovery of new uses for high-purity Vanadium products that can be readily
produced at Lac Dore has significantly changed the corporate direction of MKBY.
Management believes that the risks associated with moving into these new markets
are mitigated by the tremendous potential available to MKBY.
4
Dermond
Ptarmigan Off-Grid Power Inc & Dermond Inc are preparing plans to develop
Dermond's Vertical Axis Wind Turbine technology into a commercial product.
Current plans call for construction of a 75 kW wind turbine to prove Dermond's
patent pending improvements and obtain necessary UL and CSA approvals prior to
the implementation of full-scale commercialization. Negotiations to obtain the
funding necessary to implement the plans are ongoing and expected to be
completed in the near future.
Great Western Diamond Company
MKBY is actively seeking a buyer for its Great Western Diamond Company
subsidiary, which owns the Kelsey Lake diamond mine near Ft. Collin, Colorado,
USA's only diamond mine. MKBY has decided to sell Kelsey Lake to focus its
business efforts on Vanadium oriented electricity products. Negotiations with
several interested parties are ongoing.
SEC Filing
The Company continues to proceed with a SEC filing to become a fully reporting
company to qualify for a listing on an USA stock exchange. Initial plans
continue to seek a listing on a recognizedn Stock Exchange upon securing SEC
approvals.
LIQUIDITITY AND CAPITAL RESOURCES
As of June 30, 2002, the Company had $630,024 in cash and marketable securities.
Most of the working capital is allocated to Lac Dore development, Dermond and
Ptarmigan development, and activities at Kelsey Lake to expedite a sale of
Kelsey Lake.
In 2001 the Quebec government passed a new law to issue a cash refund for up to
52% of a Quebec originated Net Operating Loss. The Company has requested its
accounting firm investigate the applicability of this new law to expenses
incurred in Quebec. If applicable as expected, the Company could receive a cash
refund in excess of C$1 million for expenses incurred in the last year.
In 2001, the Quebec and Federal governments of Canada provided the Company with
various grants, totaling approximately $1.07 million. Approximately $593,000 of
the grants become payable the decision not to proceed with development of Lac
Dore is made within 24 months after the completion of the Feasibility Study.
Approximately $296,000 begins to amortize 24 months after the completion of the
Feasibility Study. The remaining balance, approximately $181,000 does not
require repayment.
The ability of the Company to satisfy the cash requirements of its operations
will be dependent upon future financing. The Company anticipates that additional
financing will be obtained, although no assurance can be made that funds will be
available on terms acceptable to the Company.
INVESTING AND FINANCE ACTIVITIES
The Company is investigating potential financing sources and is in discussions
with potential strategic partners for various segments of Company activities.
OUTLOOK
The Company will need to issue an unknown number of Common Shares of McKenzie
Bay International Ltd to raise additional financing to fund its development and
operations.
5
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None to report
ITEM 2. RECENT SALES OF UNREGISTERED SECURITIES
Following is a summary of sales of unregistered securities for the quarter ended
June 30, 2002. All securities were issued as restricted common shares, which are
subject to Rule 144 of the Securities and Exchange Commission. Generally, Rule
144 requires shareholders to hold the shares for a minimum of one year before
sale. In addition, officers, directors and more than 10% shareholders are
further restricted in their ability to sell such shares. There have been no
underwriters of these securities and no commissions or underwriting discounts
have been paid.
Shares Value
Quarter ended June 30, 2002 Issued Received
------------------------------------ ------- --------
Private placement for cash 590,162 669,461
Issued for services and acquisitions -0- -0-
Total for quarter ended June 30, 2002 590,162 669,461
Item 6. EXHIBITS AND REPORTS ON FORM 8-K(a)
(a) Exhibits -
Exhibit No. Descrpition
--------- -----------
23.1 Accountant's Consent
99.01 News Release - April 22,2002
99.02 News Release - June 20, 2002
99.03 News Release - (Subsuquent Event) - July 24, 2002
99.04 News Release - (Subsuquent Event) - August 12, 2002
99.05 Certification Of CEO And CFO
(b) Reports on Form 8-K -(Subsequent Event) - July 26, 2002
Item No. 1. Changes in Control of Registrant.
May 30, 2002, the Board of Directors approved the nomination
of Mr. Steven McCormick as an addition to McKenzie Bay International
Ltd.'s board. Mr. McCormick accepted the position contingent that the
Company enact a director and officers insurance policy on his position
with McKenzie Bay International. As of July 15, 2002, Mr. McCormick
has the insurance policy coverage and he accepted the board position.
The Company's Corporate By-Laws allows for 10-seats
for its board make-up. This additional appointment bring the current
seating from 6-seats to 7-seats.
The current make-up of the Company's Board of Directors and Officers
are:
Mr. Gary Westerholm - Chairman of the Board/ CEO & President
Mr. Gregory Bakeman - Board of Director/ CFO & Treasuer
Mr. John Swarin - Board of Director/ Secretary
Mr. Donald Murphy - Board of Director/ Vice-president
Mr. Rocco Martino - Board of Director
Mr. Yves Harvey - Board of Director
Mr. Steven McCormick - Board of Director.
6
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
McKENZIE BAY INTERNATIONAL LTD
Date: August 14, 2002 By: /s/ Gary L. Westerholm
----------------------------------
Gary L. Westerholm
President and Director
(Principal Executive Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed below by the following persons on behalf of the Company and in
the capacities and on the dates indicated.
Date: August 14, 2002 By: /s/ Gregory N. Bakeman
----------------------------------
Gregory N. Bakeman
Chief Financial Officer and Director
(Principal, Financial and Accounting Officer)