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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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[X] |
QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2007 |
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OR |
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[ ] |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission file number 000-50994
ARDENT MINES LIMITED
NEVADA
(State or other jurisdiction of incorporation or organization)
110 Jardin Drive, Suite 13
Concord, Ontario
Canada L4K 2T7
(Address of principal executive offices, including zip code.)
(905) 761-1096
(telephone number, including area code)
Check whether the issuer (1) 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 filing requirements for the last 90 days.
YES [X] NO [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer, "accelerated filer," "non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES [X] NO [ ]
State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 6,014,450 as of February 1, 2008
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PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
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F-1 |
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F-2 |
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F-3 |
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F-4 |
- 2 -
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ARDENT MINES LIMITED |
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(An Exploration Stage Company) |
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(Unaudited) |
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December 31, |
June 30, |
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2007 |
2007 |
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ASSETS |
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Current Assets |
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Cash |
$ |
24,076 |
$ |
47,879 |
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Total Current Assets |
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24,076 |
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47,879 |
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TOTAL ASSETS |
$ |
24,076 |
$ |
47,879 |
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LIABILITIES AND STOCKHOLDERS' DEFICIT |
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Current Liabilities |
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Accounts payable |
$ |
11,785 |
$ |
3,835 |
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Stock payable |
82,432 |
82,432 |
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Due to related party |
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16,129 |
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16,129 |
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Total Current Liabilities |
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110,346 |
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102,396 |
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TOTAL LIABILITIES |
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110,346 |
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102,396 |
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Stockholders' Deficit |
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Common Stock, $0.00001 par value, 100,000,000 |
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shares authorized, 6,014,450 shares issued |
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and outstanding |
60 |
60 |
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Additional paid in capital |
377,675 |
377,675 |
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Deficit accumulated during the development stage |
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(464,005) |
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(432,252) |
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Total Stockholders' Deficit |
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(86,270) |
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(54,517) |
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TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT |
$ |
24,076 |
$ |
47,879 |
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(The accompanying notes are an integral part of the these financial statements)
F-1
- 3 -
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ARDENT MINES LIMITED |
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(An Exploration Stage Company) |
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(unaudited) |
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Inception |
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(July 27, 2000) |
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Through |
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Three Months Ended |
Six Months Ended |
December 30, |
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December 31, 2007 |
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December 31, 2006 |
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December 31, 2007 |
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December 31, 2006 |
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2007 |
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Revenues |
$ |
- |
$ |
- |
$ |
- |
$ |
- |
$ |
- |
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Operating Expenses: |
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Consulting Expense |
2,385 |
- |
2,385 |
- |
275,433 |
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Filing and Incorporation Fees |
- |
100 |
180 |
632 |
3,233 |
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General & Administrative |
1,837 |
873 |
1,865 |
873 |
36,526 |
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Legal & Accounting |
25,838 |
3,650 |
27,323 |
10,970 |
123,396 |
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Mining Exploration |
- |
7,500 |
- |
7,500 |
14,588 |
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Travel |
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- |
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- |
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- |
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- |
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9,539 |
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Total Operating Expenses |
30,060 |
12,123 |
31,753 |
19,975 |
462,715 |
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Interest expense |
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- |
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- |
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- |
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- |
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1,290 |
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Net loss |
$ |
(30,060) |
$ |
(12,123) |
$ |
(31,753) |
$ |
(19,975) |
$ |
(464,005) |
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Net loss per share |
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Basic and diluted |
$ |
(.00) |
$ |
(.00) |
$ |
(.00) |
$ |
(.00) |
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Weighted average |
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shares outstanding- Basic and diluted |
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(The accompanying notes are an integral part of the these financial statements)
F-2
- 4 -
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ARDENT MINES LIMITED |
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(An Exploration Stage Company) |
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(unaudited) |
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Inception |
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(July 27, 2000) |
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Six Months Ended |
Through |
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December 31, |
December 31, |
December 31, |
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2007 |
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2006 |
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2007 |
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CASH FLOWS FROM OPERATING ACTIVITIES |
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Net loss |
$ |
(31,753) |
$ |
(19,975) |
$ |
(464,005) |
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Adjustments to reconcile net loss to |
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cash used in operating activities: |
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Imputed interest on related party payable |
- |
- |
1,290 |
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Stock issued for services |
- |
- |
275,000 |
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Change in: |
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Accounts payable & accrued liabilities |
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7,950 |
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1,785 |
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11,785 |
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NET CASH USED IN OPERATING ACTIVITIES |
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(23,803) |
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(18,190) |
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(175,930) |
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CASH FLOWS FROM FINANCING ACTIVITIES |
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Proceeds from sales of common stock |
- |
30,500 |
183,877 |
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Advances from related party |
- |
632 |
16,129 |
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Loan payable advanced |
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- |
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9,932 |
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- |
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NET CASH PROVIDED BY FINANCING |
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ACTIVITIES |
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- |
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41,064 |
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200,006 |
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NET CHANGE IN CASH |
(23,803) |
22,874 |
24,076 |
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CASH AT BEGINNING OF PERIOD |
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47,879 |
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89 |
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- |
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CASH AT END OF PERIOD |
$ |
24,076 |
$ |
22,963 |
$ |
24,076 |
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Supplemental Disclosures |
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Interest Paid |
$ |
- |
$ |
- |
$ |
- |
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Income tax Paid |
- |
- |
- |
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(The accompanying notes are an integral part of the these financial statements)
F-3
- 5 -
ARDENT MINES LIMITED
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited interim financial statements of Ardent Mines, Ltd ("Ardent"), have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in Ardent's Annual Report filed with the SEC on Form 10−KSB. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which substantially duplicate the disclosure contained in the audited financial statements for fiscal 2007 as reported in the Form 10−KSB have been omitted.
NOTE 2 - GOING CONCERN
From July 27, 2000 (date of inception) to December 31, 2007, Ardent Mines, Ltd has incurred a loss of $464,005 and has a negative working capital of $86,270 at December 31, 2007. The ability of Ardent Mines to emerge from the exploration stage with respect to any planned principal business activity is dependent upon its successful efforts to raise additional equity financing and/or attain profitable mining operations. Management has plans to seek additional capital through a private placement and public offering of its common stock. There is no guarantee that Ardent Mines will be able to complete any of the above objectives. These factors raise substantial doubt regarding Ardent Mines' ability to continue as a going concern.
F-4
- 6 -
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of our report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions. We are a shell company and have not yet generated or realized any revenues.
Business
From Inception on July 27, 2000 to December 11, 2006
In September 2000, we acquired one mineral property containing eight mining claims in British Columbia, Canada by arranging the staking of the same through James Thom, a non affiliated third party. The property was located on Copperkettle Creek, approximately three miles upstream from its confluence with Kettle Creek. It was on the eastern slope of Beaverdale Range of the Monashee Mountains. The claims were located approximately thirty miles east of the town of Penticton, British Columbia. Each claim was 500 meters by 500 meters or 25 hectares. Canadian jurisdictions allow a mineral explorer to claim a portion of available Crown lands as its exclusive area for exploration by depositing posts or other visible markers to indicate a claimed area. The process of posting the area was known as staking. Mr. Anderson, our former president, paid Mr. Thom $1,282 to stake the claims. The claims were recorded in Mr. Thom's name to avoid paying additional fees, and he has provided the company with a signed and executed Bill of Sale in our favor.
Part of the first phase exploration program was completed on the Sun #100 - Sun #800 claims during the period from August 14 to August 24, 2004. The program consisted of the emplacement of a survey control grid, the collection of soil & rock samples, prospecting and geological mapping and was completed by Gerard Gallissant, B.A., and a field assistant. We did not find an ore body and the claims expired by operation of law on August 26, 2006. From then until December 11, 2006, we owned no property or the right to conduct exploration activities on any property.
From August 26, 2006 to December 11, 2006, we did not conduct any operations. During that period, we intended to identify an acquisition or merger candidate with ongoing operations in any field, however, in December, 2006, we decided to acquire the right to explore a new property in British Columbia and returned to the business of mineral exploration.
Current Business - After December 11, 2006
We are a development exploration stage corporation and have not yet generated or realized any revenues from our business operations.
- 7 -
Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital. This is because we have not generated any revenues and no revenues are anticipated until we begin removing and selling minerals. There is no assurance we will ever reach this point. Accordingly, we must raise cash from sources other than the sale of minerals found on the property. Our only other source for cash at this time is investments by others. We must raise cash to implement our project and stay in business. We raised $82,432 in fiscal 2007 by offering 8,243,200 shares of our common stock by private placement. We believe that it will last at least twelve months.
In December 2006, Taras Chebountchak, our president and a member of the board of directors acquired one mining claim containing eleven cells in British Columbia, Canada from Lloyd C. Brewer by paying Mr. Brewer $7,500. Mr. Brewer is a geologist and a non affiliated third party. No additional payments were made or are due to Mr. Brewer for his services. A claim is a grant from the Canadian Crown of the available land within the cells to the holder to remove and sell minerals. A cell is an area which appears electronically on the British Columbia Internet Minerals Titles Online Grid. The online grid is the geographical basis for the cell. Mr. Brewer is a self-employed contract staker, field worker and professional geologist residing in British Columbia.
Under British Columbia law title to British Columbia mining cells can only be held by British Columbia residents. In the case of corporations, title must be held by a British Columbia corporation. In order to comply with the law we would have to incorporate a British Columbia wholly owned subsidiary corporation and obtain audited financial statements. We believe those costs would be a waste of our money at this time.
The cells were recorded in Mr. Chebountchak's name to avoid incurring additional costs at this time. The additional fees would be for incorporation of a British Columbia corporation and legal and accounting fees related to the incorporation. On January 2, 2007, Mr. Chebountchak executed a declaration of trust acknowledging that he holds the property in trust for us and he will not deal with the property in any way, except to transfer the property to us. In the event that Mr. Chebountchak transfers title to a third party, the declaration of trust will be used as evidence that he breached his fiduciary duty to us. Mr. Chebountchak has not provided us with a signed or executed bill of sale in our favor.
To date we have not performed any work on the property. We are presently in the exploration stage and we cannot guarantee that a commercially viable mineral deposit, a reserve, exists in the property until further exploration is done and a comprehensive evaluation concludes economic and legal feasibility.
We will be conducting research in the form of exploration of the property. Our exploration program is explained in as much detail as possible. We are not going to buy or sell any plant or significant equipment during the next twelve months.
The property is undeveloped raw land. Exploration will not begin until Spring of 2008. To our knowledge, the property has never been mined. The only event that has occurred is the acquisition of the property from Mr. Brewer, registering the property in the name of Mr. Chebountchak, and a physical examination of the property by Mr. Brewer.
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Mineralized material is a mineralized body, which has been delineated by appropriate spaced drilling or underground sampling to support sufficient tonnage and average grade of metals to justify removal before minerals retrieval can begin, we must explore for and find mineralized material. After that has occurred we have to determine if it is economically feasible to remove the mineralized material. Economically feasible means that the costs associated with the removal of the mineralized material will not exceed the price at which we can sell the mineralized material. We can not predict what that will be until we find mineralized material.
We do not know if we will find mineralized material. We believe that activities occurring on adjoining properties are not material to our activities. The reason is that what ever is located under adjoining property may or may not be located under the property.
We do not claim to have any minerals or reserves whatsoever at this time on any of the property. We intend to implement an exploration program which consists of core sampling. Core sampling is the process of drilling holes to a depth of up to 100 feet in order to extract samples of earth. Mr. Chebountchak, after confirming with our consultant, will determine where drilling will occur on the property. Mr. Chebountchak will not receive fees for his services.
The samples will be tested to determine if mineralized material is located on the property. Based upon the tests of the core samples, we will determine if we will terminate operations; proceed with additional exploration of the property; or develop the property. The proceeds from our private placement are designed to only fund the costs of core sampling and testing. We intend to take our core samples to analytical chemists, geochemists and registered assayers located in British Columbia. We have not selected any of the foregoing as of the date of this report.
We estimate the cost of drilling will be $20 per foot drilled. We intend to drill approximately 1,000 linear feet or 10 holes to depth of 100 feet. We estimate that it will take one month to drill 10 holes to a depth of 100 feet each. We will pay a consultant $5,000 for his services to supervise the exploration. The total cost for analyzing the core samples will be $3,000. We will begin exploration in the Spring of 2008, weather permitting.
In the event that we find mineralized material and the mineralized material can be economically extracted, we will form a wholly owned British Columbia subsidiary corporation and Mr. Chebountchak will convey title to the property to the wholly owned subsidiary corporation. Should Mr. Chebountchak transfer title to another person and that deed is recorded before we record our documents, that other person will have superior title and we will have none. If that event occurs, we will have to cease or suspend operations. However, Mr. Chebountchak will be liable to us for monetary damages for breaching the terms of his oral agreement with us to transfer his title to a subsidiary corporation we create. To date we have not performed any work on the property. All Canadian lands and minerals which have not been granted to private persons are owned by either the federal or provincial governments in the name of Her Majesty Elizabeth II. Ungranted minerals are commonly known as Crown minerals. Ownership rights to Crown minerals are vested by the Canadian Constitution in the province where the minerals are located. In the case of the Company's property, that is the province of British Columbia.
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We do not intend to sell interests to other companies in the property if we find mineralized materials. We intend to try to develop the reserves ourselves through the use of consultants. We have no plans to interest other companies in the property if we find mineralized material. To pay the consultant and develop the reserves, we will have to raise additional funds through a second public offering, a private placement or through loans. As of the date of this report, we have no plans to raise additional funds. Further, there is no assurance we will be able to raise any additional funds even if we discover mineralized material and a have a defined ore body.
We do not intend to hire additional employees at this time. All of the work on the property will be conduct by unaffiliated independent contractors that we will hire. The independent contractors will be responsible for surveying, geology, engineering, exploration, and excavation. The geologists will evaluate the information derived from the exploration and excavation and the engineers will advise us on the economic feasibility of removing the mineralized material.
Property
The property lies one mile north of the town of Beaverdell and approximately 180 miles east of Vancouver, British Columbia. The property is located at the southern flank of King Solomon Mountain, within the Kettle River Valley on the nose of an outcrop ridge that is formed at the junction of Beaverdell Creek with the West Kettle River. The following is a list of tenure numbers, cells, date of recording and expiration date of the cells:
Our property is recorded in Mr. Chebountchak's name. In order to maintain our property we must pay a fee of CND$100 per year per cell.
The property is unencumbered and there are no competitive conditions which affect the property. Further, there is no insurance covering the property and we believe that no insurance is necessary since the property is unimproved and contains no buildings or improvements.
There are no native land claims that affect title to the property. We have no plans to try to interest other companies in the property if mineralization is found. If mineralization is found, we will try to develop the property ourselves.
Milestones
The following are our milestones:
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1. |
March 2008 - Retain our consultant to manage the exploration of the property. Cost - $5,000 to $15,000. Time of retention 0-90 days. To carry out this milestone, we must hire a consultant. There are a number of mining consultants located in Vancouver, British Columbia that we intend to interview. |
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2. |
90-180 days after March 2008 - Core drilling. Core drilling will cost $20 per foot. The number of holes to be drilled will be dependent upon the amount raised from the offering. Core drilling will be subcontracted to non-affiliated third parties. Cost - $55,500 to $132,000. Time to conduct the core drilling - 90 days. To carry out this milestone we must conduct the core drilling. The driller will be retained by our consultant. |
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3. |
180-210 days after March 2008 - Have an independent third party analyze the samples from the core drilling. Determine if mineralized material is below the ground. If mineralized material is found, we will attempt to define the ore body. We estimate that it will cost $3,000 to analyze the core samples and will take 30 days. Delivery of the samples to the independent third party is necessary to carry out this milestone. |
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4. |
210-270 days after March 2008 - If we discover significant quantities of mineral, we will have technical and economic feasibility studies to determine if we have reserves. These studies will be performed by third party professors. Cost - $5,000 to $10,000. |
We completed a private placement offering on July 27, 2007 by issuing 8,243,200 shares and raising $82,432. We believe that this amount will fund our mineral exploration program as described in our public offering.
The cost of the subcontractors is included in cost of the core drilling. None of the funds for the exploration of the property have been raised. All funds for the foregoing activities will have to be raised prior to the initiation of exploration activities. There is no assurance we will be able to raise any money or initiate our exploration activities.
Limited Operating History; Need for Additional Capital
There is limited historical financial information about us upon which to base an evaluation of our performance. We are an exploration stage corporation and have not generated any revenues from operations.
To become profitable and competitive, we have to conduct exploration on the property and find mineralized material. We will be seeking equity financing to provide for the capital required to implement our research and exploration phases. On July 27, 2007 we completed our private placement. During fiscal 2007, we raised $82,432 related to this private placement by selling 8,243,200 shares of common stock at a price of $0.01 per share to eleven shareholders. There were no commissions or other similar offering expenses. We believe that these funds will allow us to operate for the next twelve months.
We have no assurance that future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing shareholders.
Results of Operations
From Inception on July 27, 2000 to December 31, 2007
We acquired the right to prospect on one property containing eight claims. Part of the first phase exploration program was completed on the Sun #100 - Sun #800 claims during the period of August 14 to August 24, 2004. The program consisted of the emplacement of a survey control grid, the collection of soil & rock samples, prospecting and geological mapping and was completed by Gerard Gallissant, B.A., and a field assistant. We did not find an ore body and the claims expired by operation of law. Accordingly, we own no property or the right to conduct exploration activities on any property.
- 11 -
On December 12, 2006, we acquired the right to prospect on three properties containing eleven claims. We are in the process of implementing our mining exploration program as discussed in detail in the business section of our public offering.
Liquidity and Capital Resources
As of the date of this report, we have yet to generate any revenues from our business operations.
We issued 5,000,000 shares of common stock to Taras Chebountchak, our sole officer and director pursuant to the exemption from registration contained in Rule 144 of the Securities Act of 1933. This was accounted for as an acquisition of shares.
On April 2, 2004, we completed our initial public offering by raising $101,450 and issuing a total of 1,014,450 shares of common stock for $0.10 per share.
We issued 8,243,200 shares related to a private placement for a total of $82,432. The shares will be issued pursuant to Regulation S of the Securities Act of 1933 to eleven investors.
As of December 31, 2007, our total assets were $24,076 and our total liabilities were $110,346.
ITEM 4. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures - Our Principal Executive Officer and Principal Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report, have concluded that, based on the evaluation of these controls and procedures, that our disclosure controls and procedures were effective.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS.
The following documents are included herein:
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Exhibit No. |
Document Description |
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31.1 |
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32.1 |
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- 12 -
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant and in the capacities on this 11th day of February, 2008 at Concord, Ontario, Canada.
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ARDENT MINES LIMITED |
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(Registrant) |
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BY: |
TARAS CHEBOUNTCHAK |
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President, Principal Executive Officer, Principal Accounting Officer, Principal Financial Officer, Secretary/Treasurer, and sole member of the Board of Director |
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- 13 -
EXHIBIT INDEX
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Exhibit No. |
Document Description |
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31.1 |
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32.1 |
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- 14 -