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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-K
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(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended DECEMBER 31, 2007
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from _____ to _______
Commission file number: 000-51033
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MONDIAL VENTURES, INC.
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(Exact name of small business issuer in its charter)
Nevada Applied For
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
388 Richmond St. W. Suite 916 M5V 3P1
Toronto Ontario, Canada
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (416) 928-3095
Securities Registered Under Section 12(b) of the Exchange Act: None
Securities Registered Under Section 12(g) of the Exchange Act:
Common Stock, $0.001 par value
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(Title of class)
Indicate by check mark if the registrant is a well-known seasoned issuer as
defined in Rule 405 of the Securities Act. Yes No [X]
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act. Yes No [X]
i
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 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 past 90 days. Yes [X] No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.
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" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer Accelerated filer
Non-accelerated (Do not check if a smaller Smaller reporting company [X]
reporting company) filer
Indicate by check mark whether the registrant is a shell company (as defined by
Rule 12b-2 of the Act). Yes No [X]
The Company's stock is traded on the Pink Sheets. As of February 21, 2010, there
were 3,800,000 shares of stock held by non-affiliates. As of February 21, 2010,
9,800,000 shares of the common stock of the registrant were outstanding.
Cautionary Statement Regarding Forward-Looking Statements
This annual report contains forward-looking statements as that term is defined
in the Private Securities Litigation Reform Act of 1995. These statements relate
to future events or our future financial performance. Some discussions in this
report may contain forward-looking statements that involve risk and uncertainty.
A number of important factors could cause our actual results to differ
materially from those expressed in any forward-looking statements made by us in
this report. 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.
In some cases, you can also identify forward-looking statements by terminology
such as "may", "will", "should", "plans", "predicts", "potential" or "continue"
or the negative of these terms or other comparable terminology. These statements
are only predictions and involve known and unknown risks, uncertainties and
other factors, including the risks in the section entitled "Risk Factors" , that
may cause our or our industry's actual results, levels of activity, performance
or achievements to be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these
forward-looking statements.
Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity or achievements. Except as required by applicable law, including the
securities laws of the United States, we do not intend to update any of the
forward-looking statements to conform these statements to actual results.
As used in this annual report, the terms "we", "us", "our", and "Mondial" mean
Mondial Ventures, Inc., unless otherwise indicated.
ii
Mondial is an exploration stage company. There is no assurance that commercially
viable mineral deposits exist on the claim we have under option or that
commercially viable petroleum reserves exist on the properties we have farmed
into or have under option. Further exploration and/or drilling will be required
before a final evaluation as to the economic and legal feasibility of our
projects is determined.
DOCUMENTS INCORPORATED BY REFERENCE
None.
PART I
ITEM 1: DESCRIPTION OF BUSINESS
In General
We are an exploration stage mineral exploration company. As such, there is no
assurance that a commercially viable mineral deposit exists on our sole mineral
property interest, the Q29 property. Further exploration will be required before
a final evaluation as to the economic and legal feasibility of the Q29 property
is determined.
We will be engaged in the acquisition, and exploration of mineral properties
with a view to exploiting any mineral deposits we discover that demonstrate
economic feasibility. We own a 100% interest, in four contiguous mineral claims
collectively known as the Q29 property.
Our plan of operation is to conduct exploration work on the Q29 property in
order to ascertain whether it possesses economic quantities of copper or gold.
There can be no assurance that economic mineral deposits or reserves, exist on
the Q29 property until appropriate exploration work is done and an economic
evaluation based on such work concludes that production of minerals from the
property is economically feasible.
Q29 Property Purchase Agreement
On December 22, 2003, we entered into an agreement with Mr. Edward McCrossan of
Vancouver, British Columbia, whereby he agreed to sell to us a total of four
mineral claims located approximately 20 kilometers west of Port Alice, British
Columbia. In order to acquire a 100% interest in these claims, on January 5,
2004 we paid $6,000 from our corporate bank account to Mr. McCrossan.
Other than selling the Q29 claims to us, Mr. McCrossan has not had and does not
have any relationship or affiliation with us or our management.
In October 2008 due to inactivity the claims expired. We were not able to obtain
the necessary funds to restake the properties until December 2009. On December
29th, 2009 we restaked the claims and plan to move forward with further
exploration of the property.
To date, we have spent $12,000 on the acquisition and exploration of the Q29
property. In the next 12 months, we anticipate spending an additional $25,000 to
complete the exploration work recommended under the section below entitled
"Geological Report: Q29 Group Property".
Title to the Q29 Property
The Q29 property consists of four mineral claims. These claims will only be
valid as long as we spend a minimum of $880 in exploration work on each claim
per year. If we spend more than $880 on exploration in one calendar year, an
excess amount may be carried forward to subsequent years. Alternatively, we may
pay the same amount per claims in cash to the British Columbia government in
order to maintain the claims in good standing.
1
A "mineral claim" refers to a specific section of land over which a title holder
owns rights to exploration to ground. Such rights may be transferred or held in
trust. Mr. McCrossan holds the four mineral claims comprising the Q29 property
in trust for us. It is a common procedure to have such claims held in trust
given the expense that we would incur in registering as a recorded claim holder
and as an extraprovincial company in British Columbia. We can request that the
claims be registered in our name at any time.
If the trustee becomes bankrupt or transfers the claims to a third party, we may
incur significant legal expenses in enforcing our interest in the claims in
British Columbia courts.
The registration of the claims in the name of a trustee does not impact a third
party's ability to commence an action against us respecting the Q29 property or
to seize the claims after obtaining judgment.
The fee simple owner of the real property underlying the claims that comprise
the Q29 property is the government of British Columbia. The government has the
right to sell title to this land to a third party, but is unlikely to do so
given the remote location of the property. We have the right to explore the
property for mineralization, provided such exploration does not unreasonably
disturb the fee simple owner's use of the land. Because the property is
undeveloped, the British Columbia government's rights to the land use will not
be impacted and it will not have any obligations respecting the land. We will be
required to undertake remediation work on any exploration that results in
physical disturbance to the land. Refer to the section entitled "Compliance with
Government Regulation" below.
Description, Location and Access
The Q29 property is located in the Nanaimo Mining Division on Vancouver Island,
British Columbia approximately 20 kilometers west of Port Alice. The property is
road accessible by Western Forest Products logging roads which being south of
Port Alice on the east side of Neroutsos Inlet. This road is accessible year
round, except for some occasional delays and interruptions in winter due to
snowfall.
Topography within the claims area is moderate with elevations ranging between
250 feet and 1,300 feet. Vegetation and climate are typical for the west coast
of Vancouver Island. The property area is covered with evergreen trees including
hemlock, cedar and Douglas fir and softwood species such as alder and poplar.
Mosses and a variety of berry bushes are common on the forest floor. Second
growth vegetation in previously logged areas can be dense and difficult to
traverse.
The bio-climatic zone of the property area is a temperate rainforest. Annual
rainfall can exceed 25 centimeters, but much of that occurs during the winter
months. Summer daytime temperatures between June and September average between
15 and 20 degrees Celsius. Winter temperatures can drop below freezing, but are
generally moderate due to the proximity of the Pacific Ocean.
There no power lines close to the Q29 property. Accordingly, a portable
generator would be necessary in order to supply power during exploration.
Mineralization
The northwestern portion of Vancouver Island, including the property area, is
underlain primarily by volcanic, limestone and marine sediment rocks. On the Q29
property, these rock formations were altered by intrusions. An intrusion occurs
when molten rock containing a mixture of minerals and gases enters into the
existing rock formation. Such intrusions often contain concentrations of
precious minerals such as gold and silver and base metals such as copper and
molybdenum.
No reserves or economically significant mineralization has been discovered on
the Q29 property. Very limited sampling results from the property indicate low
level anomalies of zinc and silver.
2
Exploration History
To date, no mineral deposit has been delineated on the Q29 property.
Consequently there has been no reserve or resource calculated. All proposed
property work is exploratory in nature. There is no known historical work from
the property prior to 2000. There is no equipment or infrastructure on the
property. As well, no mining operations have ever been conducted on the
property.
During October of 2000, Ed McCrossan, P.Geo., collected sixteen rock grab
samples were collected along logging road cut exposures within the Q29 claims.
Grab samples are soil samples or pieces of rock that appear to contain precious
metals such as gold or industrial metals such as copper. All samples gathered
were sent to a laboratory where they were crushed and analysed for metal
content. The samples indicate low level anomalies of zinc, silver, barium and
arsenic.
Geological Report: Q29 Group Property
We have obtained a geological report on the Q29 property that was prepared by
Mr. Edward McCrossan, a professional geologist, of Vancouver, British Columbia.
The geological report summarizes the results of exploration in the area of the
Q29 property and makes a recommendation for further exploration work.
In his report, Mr. McCrossan concludes that the Q29 property has the potential
to host precious metal and polymetallic mineral occurrences and deposits given
its location on northern Vancouver Island. He notes that previous sampling
results from an area of the property that appears to contain altered,
mineralized rock returned between 0.15% and 0.60% copper. If such mineralization
continued over a significant area, the Q29 property could potentially host a
mineral deposit.
Mr. McCrossan recommends that we undertake an initial exploration program on the
property to determine the extent to which mineral levels continue over different
areas of the property. He suggests that such a program consist of grid
emplacement accompanied by geological, geochemical and geophysical surveys.
Additional phases consisting of trenching and diamond drilling are also
recommended.
The geochemical portion of the initial phase program will consist of our
consulting geologist and his assistant gathering samples from property areas
with the most potential to host economically significant mineralization based on
past exploration results.
We do not have an agreement with Mr. McCrossan to provide his geological
services for planned exploration work on the Q29 property. Mr. McCrossan has
indicated that he would be prepared to undertake such work if he was available
and that he would only retain an assistant after being retained by us. No
specific assistant has been determined.
Geophysical surveying is the search for mineral deposits by measuring the
physical property of near-surface rocks, and looking for unusual responses
caused by the presence of mineralization. Electrical, magnetic, gravitational,
seismic and radioactive properties are the ones most commonly measured.
Compliance with Government Regulation
We will be required to comply with all regulations, rules and directives of
governmental authorities and agencies applicable to the exploration of minerals
in Canada generally, and in the province of British Columbia, specifically.
Under these laws, prior to production, we have the right to explore the
property, subject only to a notice of work which may entail posting a bond if we
significantly disturb the property surface. This would first occur during
thedrilling phase of exploration.
In addition, production of minerals in the province of British Columbia requires
prior approval of applicable governmental regulatory agencies. We can provide no
assurance to investors that such approvals will be obtained. The cost and delay
involved in attempting to obtain such approvals cannot be known at this time.
3
We will have to sustain the cost of reclamation and environmental mediation for
all exploration and development work undertaken. Our first two phases of
exploration, which will consist of grid emplacement; geological, geochemical and
geophysical surveys; and trenching will not require any reclamation and
environmental mediation work because there will not be significant physical
disturbance to the land. Subsequent drilling will require some remediation work,
which is not expected to exceed $10,000. We will need to raise additional funds
to finance any drilling program, including remediation costs.
If we enter into production, the cost of complying with permit and regulatory
environment laws will be greater than in the exploration phases because the
impact on the project area is greater. Permits and regulations will control all
aspects of any production program if the project continues to that stage because
of the potential impact on the environment. Examples of regulatory requirements
include:
- Water discharge will have to meet water standards;
- Dust generation will have to be minimal or otherwise
re-mediated;
- Dumping of material on the surface will have to be
re-contoured and re-vegetated;
- An assessment of all material to be left on the surface will
need to be environmentally benign;
- Ground water will have to be monitored for any potential
contaminants;
- The socio-economic impact of the project will have to be
evaluated and if deemed negative, will have to be
re-mediated; and
- There will have to be an impact report of the work on the
local fauna and flora.
While it is difficult to know exactly how much these costs will be until we have
a better indication of the size and tenor of any production operation, we would
expect that they could be as high as $100,000.
During the initial phases of exploration, there will be no significant costs of
compliance with government regulations.
Employees
We have no full time employees as of the date of this annual report. We expect
the President of the Company will work part time on this project.
Research and Development Expenditures
We have not incurred any exploration expenditures to date. We have not incurred
any other research or development expenditures since our incorporation.
Subsidiaries
We do not have any subsidiaries.
4
Patents and Trademarks
We do not own, either legally or beneficially, any patents or trademarks.
Risk Factors
In addition to the other information in this annual report, the following
factors should be carefully considered in evaluating our business and prospects:
IF WE DO NOT OBTAIN ADDITIONAL FINANCING, OUR BUSINESS WILL FAIL.
Our current operating funds are less than necessary to complete all intended
exploration of the Q29 property, and therefore we will need to obtain additional
financing in order to complete our business plan. We currently do not have any
operations and we have no income.
Our business plan calls for significant expenses in connection with the
exploration of the Q29 property. While we have sufficient funds to conduct
initial exploration on the property, we will require additional financing in
order to determine whether the property contains economic mineralization. We
will also require additional financing if the costs of the exploration of the
Q29 property are greater than anticipated.
We will require additional financing to sustain our business operations if we
are not successful in earning revenues once exploration is complete. We do not
currently have any arrangements for financing and we can provide no assurance to
investors that we will be able to find such financing if required. Obtaining
additional financing would be subject to a number of factors, including the
market prices for copper and gold, investor acceptance of our property and
general market conditions. These factors may make the timing, amount, terms or
conditions of additional financing unavailable to us.
The most likely source of future funds presently available to us is through the
sale of equity capital. Any sale of share capital will result in dilution to
existing shareholders. The only other anticipated alternative for the financing
of further exploration would be our sale of a partial interest in the Q29
property to a third party in exchange for cash or exploration expenditures,
which is not presently contemplated.
BECAUSE WE HAVE ONLY RECENTLY COMMENCED BUSINESS OPERATIONS, WE FACE A HIGH RISK
OF BUSINESS FAILURE.
Because we have only recently commenced business operations, we have been
involved primarily in organizational activities and the acquisition of our
mineral property. We have not earned any revenues as of the date of this annual
report. Potential investors should be aware of the difficulties normally
encountered by new mineral exploration companies and the high rate of failure of
such enterprises. The likelihood of success must be considered in light of the
problems, expenses, difficulties, complications and delays encountered in
connection with the exploration of the mineral properties that we plan to
undertake. These potential problems include, but are not limited to,
unanticipated problems relating to exploration, and additional costs and
expenses that may exceed current estimates.
Prior to completion of our exploration stage, we anticipate that we will incur
increased operating expenses without realizing any revenues. We therefore expect
to incur significant losses into the foreseeable future. We recognize that if we
are unable to generate significant revenues from development of the Q29 property
and the production of minerals from the claims, we will not be able to earn
profits or continue operations.
There is no history upon which to base any assumption as to the likelihood that
we will prove successful, and we can provide investors with no assurance that we
will generate any operating revenues or ever achieve profitable operations. If
we are unsuccessful in addressing these risks, our business will most likely
fail.
5
BECAUSE OF THE SPECULATIVE NATURE OF EXPLORATION OF MINING PROPERTIES, THERE IS
A SUBSTANTIAL RISK THAT OUR BUSINESS WILL FAIL.
The search for valuable minerals as a business is extremely risky. We can
provide investors with no assurance that our mineral claims contain economic
mineralization or reserves of copper or gold. Exploration for minerals is a
speculative venture necessarily involving substantial risk. Our exploration of
the Q29 property may not result in the discovery of commercial quantities of
copper or gold. Problems such as unusual or unexpected formations and other
conditions are involved in mineral exploration and often result in unsuccessful
exploration efforts. In such a case, we would be unable to complete our business
plan.
BECAUSE OF THE INHERENT DANGERS INVOLVED IN MINERAL EXPLORATION, THERE IS A RISK
THAT WE MAY INCUR LIABILITY OR DAMAGES AS WE CONDUCT OUR BUSINESS.
The search for valuable minerals involves numerous hazards. As a result, we may
become subject to liability for such hazards, including pollution, cave-ins and
other hazards against which we cannot insure or against which we may elect not
to insure. The payment of such liabilities may have a material adverse effect on
our financial position.
EVEN IF WE DISCOVER RESERVES OF PRECIOUS METALS ON THE Q29 PROPERTY, WE MAY NOT
BE ABLE TO SUCCESSFULLY DEVELOP THE Q29 CLAIMS.
The Q29 property does not contain any known bodies of mineralization. If our
exploration programs are successful in establishing copper of commercial tonnage
and grade, we will require additional funds in order to further develop the
property. At this time, we cannot assure investors that we will be able to
obtain such financing.
WE NEED TO CONTINUE AS A GOING CONCERN IF OUR BUSINESS IS TO SUCCEED.
The independent accountant's report to our audited financial statements for the
period ended December 31, 2006, indicates that there are a number of factors
that raise substantial doubt about our ability to continue as a going concern.
Such factors identified in the report are our net loss position, our failure to
attain profitable operations and our dependence upon obtaining adequate
financing. If we are not able to continue as a going concern, it is likely
investors will lose their investments.
IF WE BECOME SUBJECT TO BURDENSOME GOVERNMENT REGULATION OR OTHER LEGAL
UNCERTAINTIES, OUR BUSINESS WILL BE NEGATIVELY AFFECTED.
There are several governmental regulations that materially restrict mineral
property exploration and development. Under British Columbia mining law, to
engage in certain types of exploration will require work permits, the posting of
bonds, and the performance of remediation work for any physical disturbance to
the land. While these current laws do not affect our current exploration plans,
if we proceed to commence drilling operations on the Q29 property, we will incur
modest regulatory compliance costs.
In addition, the legal and regulatory environment that pertains to the
exploration of ore is uncertain and may change. Uncertainty and new regulations
could increase our costs of doing business and prevent us from exploring for ore
deposits. The growth of demand for ore may also be significantly slowed. This
could delay growth in potential demand for and limit our ability to generate
revenues. In addition to new laws and regulations being adopted, existing laws
may be applied to mining that have not as yet been applied. These new laws may
increase our cost of doing business with the result that our financial condition
and operating results may be harmed.
BECAUSE OUR DIRECTORS OWN 61.2% OF OUR OUTSTANDING COMMON STOCK, THEY COULD MAKE
AND CONTROL CORPORATE DECISIONS THAT MAY BE ISADVANTAGEOUS TO OTHER MINORITY
SHAREHOLDERS.
6
Our directors own approximately 61.2% of the outstanding shares of our common
stock. Accordingly, they will have a significant influence in determining the
outcome of all corporate transactions or other matters, including mergers,
consolidations, and the sale of all or substantially all of our assets. They
will also have the power to prevent or cause a change in control. The interests
of our directors may differ from the interests of the other stockholders and
thus result in corporate decisions that are disadvantageous to other
shareholders.
BECAUSE MANAGEMENT HAS NO TECHNICAL EXPERIENCE IN MINERAL EXPLORATION, OUR
BUSINESS HAS A HIGHER RISK OF FAILURE.
None of our directors has any technical training in the field of geology. As a
result, we may not be able to recognize and take advantage of potential
acquisition and exploration opportunities in the sector without the aid of
qualified geological consultants. As well, with no direct training or
experience, our management may not be fully aware of the specific requirements
related to working in this industry. Their decisions and choices may not be well
thought out and our operations and ultimate financial success may suffer
irreparable harm as a result.
BECAUSE OUR DIRECTORS HAVE OTHER BUSINESS INTERESTS, THEY MAY NOT BE ABLE OR
WILLING TO DEVOTE A SUFFICIENT AMOUNT OF TIME TO OUR BUSINESS OPERATIONS,
CAUSING OUR BUSINESS TO FAIL.
Our president, Mr. Taylor and our secretary, Mr. Alvaro intend to devote 20 and
five hours per week respectively to our business affairs. It is possible that
the demands on Mr. Taylor and Mr. Alvaro from their other obligations could
increase with the result that they would no longer be able to devote sufficient
time to the management of our business. In addition, Mr. Taylor and Mr. Alvaro
may not possess sufficient time for our business if the demands of managing our
business increased substantially beyond current levels.
IF A MARKET FOR OUR COMMON STOCK DOES NOT DEVELOP, SHAREHOLDERS MAY BE UNABLE TO
SELL THEIR SHARES.
There is currently no market for our common stock and we can provide no
assurance that a market will develop. We have applied for quotation of our
common stock on the over the counter bulletin board. However, we can provide
investors with no assurance that our shares will be traded on the bulletin board
or, if traded, that a public market will materialize. If no market is ever
developed for our shares, it will be difficult for shareholders to sell their
stock. In such a case, shareholders may find that they are unable to achieve
benefits from their investment.
A PURCHASER IS PURCHASING PENNY STOCK WHICH LIMITS HIS OR HER ABILITY TO SELL
THE STOCK.
Our shares constitute penny stock under the Securities and Exchange Act. The
shares will remain penny stock for the foreseeable future. The classification of
penny stock makes it more difficult for a broker-dealer to sell the stock into a
secondary market, which makes it more difficult for a purchaser to liquidate his
or her investment. Any broker-dealer engaged by the purchaser for the purpose of
selling his or her shares in our company will be subject to rules 15g-1 through
15g-10 of the Securities and Exchange Act. Rather than creating a need to comply
with those rules, some broker-dealers will refuse to attempt to sell penny
stock.
ITEM 1(B) UNRESOLVED STAFF COMMENTS
None
7
ITEM 2: DESCRIPTION OF PROPERTY
We own a 100% interest, in four mineral claims comprising the Q29 property. We
do not own or lease any property other than the Q29 property.
ITEM 3: LEGAL PROCEEDINGS
We know of no material, active or pending legal proceedings against our company,
nor are we involved as a plaintiff in any material proceeding or pending
litigation. There are no proceedings in which any of our directors, officers or
affiliates, or any registered or beneficial shareholder, is an adverse party or
has a material interest adverse to our interest.
ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted during the fourth quarter of our fiscal year to a vote
of security holders, through the solicitation of proxies or otherwise.
PART II
ITEM 5: MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
The Securities and Exchange Commission has adopted Rule 15g-9 which establishes
the definition of a "penny stock," for purposes relevant to us, as any equity
security that has a market price of less than $5.00 per share or with an
exercise price of less than $5.00 per share, subject to certain exceptions. For
any transaction involving a penny stock, unless exempt, the rules require: (i)
that a broker or dealer approve a person's account for transactions in penny
stocks and (ii) the broker or dealer receive from the investor a written
agreement to the transaction, setting forth the identity and quantity of the
penny stock to be purchased. In order to approve a person's account for
transactions in penny stocks, the broker or dealer must (i) obtain financial
information and investment experience and objectives of the person; and (ii)
make a reasonable determination that the transactions in penny stocks are
suitable for that person and that person has sufficient knowledge and experience
in financial matters to be capable of evaluating the risks of transactions in
penny stocks. The broker or dealer must also deliver, prior to any transaction
in a penny stock, a disclosure schedule prepared by the Commission relating to
the penny stock market, which, in highlight form, (i) sets forth the basis on
which the broker or dealer made the suitability determination and (ii) that the
broker or dealer received a signed, written agreement from the investor prior to
the transaction. Disclosure also has to be made about the risks of investing in
penny stocks in both public offerings and in secondary trading, and about
commissions payable to both the broker-dealer and the registered representative,
current quotations for the securities and the rights and remedies available to
an investor in cases of fraud in penny stock transactions. Finally, monthly
statements have to be sent disclosing recent price information for the penny
stock held in the account and information on the limited market in penny stocks.
Our shares of common stock commenced quotation on the Pink Sheets under the
symbol MNVN on December 4, 2006. However, no trades have occurred through the
facilities of the Pink Sheets to date.
We have 31 shareholders of record as at the date of this annual report.
Dividends
We have not declared any dividends since incorporation and do not anticipate
that we will do so in the foreseeable future. Although there are no restrictions
that limit the ability to pay dividends on our common shares, our intention is
to retain future earnings for use in our operations and the expansion of our
business
8
High Low
Fiscal 2009
First Quarter $0.00 $0.00
Second Quarter $0.00 $0.00
Third Quarter $0.00 $0.00
Fourth Quarter $0.00 $0.00
Fiscal 2008
First Quarter $0.00 $0.00
Second Quarter $0.00 $0.00
Third Quarter $0.00 $0.00
Fourth Quarter $0.00 $0.00
Fiscal 2007
First Quarter $0.00 $0.00
Second Quarter $0.00 $0.00
Third Quarter $0.00 $0.00
Fourth Quarter $0.00 $0.00
Fiscal 2006
First Quarter $0.00 $0.00
Second Quarter $0.00 $0.00
Third Quarter $0.00 $0.00
Fourth Quarter $0.00 $0.00
Equity Compensation Plan Information
None
Recent Sales of Unregistered Securities
None
Changes in Securities
=====================
The Corporation had 9,800,000 shares of common stock issued and outstanding as
of December 31, 2007, December 31, 2008 and December 31, 2009.
ITEM 6. SELECTED FINANCIAL DATA.
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act
and therefore are not required to provide the information required under this
item.
ITEM 7: MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
FORWARD-LOOKING STATEMENTS
All statements other than statements of historical fact included in Management's
Discussion and Analysis of Financial Condition and Results of Operations" which
follows, are forward-looking statements. Forward-looking statements involve
9
various important assumptions, risks, uncertainties and other factors which
could cause our actual results to differ materially from those expressed in such
forward-looking statements. Forward-looking statements in this discussion can be
identified by words such as "anticipate," "believe," "could," "estimate,"
"expect," "plan," "intend," "may," "should" or the negative of these terms or
similar expressions. Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
performance or achievement. Actual results could differ materially from those
contemplated by the forward-looking statements as a result of certain factors
including but not limited to, competitive factors and pricing ressures, changes
in legal and regulatory requirements, cancellation or deferral of customer
orders, technological change or difficulties, difficulties in the timely
development of new products, difficulties in manufacturing, commercialization
and trade difficulties and general economic conditions as well as the factors
set forth in our public filings with the Securities and Exchange Commission.
You are cautioned not to place undue reliance on the forward-looking statements,
which speak only as of the date of this Annual Report or the date of any
document incorporated by reference, in this Annual Report. We are under no
obligation, and expressly disclaim any obligation, to update or alter any
forward-looking statements, whether as a result of new information, future
events or otherwise.
For these statements, we claim the protection of the safe harbor for
forward-looking statements contained in Section 21E of the Securities Exchange
Act of 1934.
Plan of Operation
Our plan of operation for the twelve months following the date of this annual
report is to complete the recommended grid emplacement and geological,
geochemical and geophysical surveys on the Q29 property. We anticipate that the
cost of this program will be approximately $10,000 and will take approximately
60 days, including the interpretation of all data collected.
We have plan to retain, a professional geologist, to undertake the proposed
exploration on the Q29 property. If results of this initial exploration program
indicate that the Q29 property may contain an economic mineral deposit, we will
proceed with a trenching program in spring. We expect the trenching program will
cost approximately $15,000 and take approximately 60 days to complete. We do not
have any arrangement with a qualified geologist to oversee the trenching
program.
As well, we anticipate spending an additional $12,500 on professional fees,
including fees payable for compliance with reporting obligations.
Total expenditures over the next 12 months are therefore expected to be $37,500.
We will require additional funding in order to proceed with proposed exploration
and to cover administrative costs. We anticipate that additional funding will be
required in the form of equity financing from the sale of our common stock.
However, we cannot provide investors with any assurance that we will be able to
raise sufficient funding from the sale of our common stock to fund the second
phase of the exploration program. We believe that debt financing will not be an
alternative for funding the complete exploration program. We do not have any
arrangements in place for any future equity financing.
Our cash reserves are not sufficient to meet our obligations for the next
twelve-month period. As a result, we will need to seek additional funding in the
near future. We currently do not have a specific plan of how we will obtain such
funding; however, we anticipate that additional funding will be in the form of
equity financing from the sale of our common stock. Our management is prepared
to provide us with short-term loans, although no such arrangement has been made.
There are no financial limitations on the amount of money that management may
lend to us.
10
At this time, we cannot provide investors with any assurance that we will be
able to raise sufficient funding from the sale of our common stock or through a
loan from our directors to meet our obligations over the next twelve months. We
do not have any arrangements in place for any future equity financing.
We have not and do not intend to seek debt financing by way of bank loan, line
of credit or otherwise. Financial institutions do not typically lend money to
mineral exploration companies with no stable source of revenue.
If we do not secure additional funding for exploration expenditures, we may
consider seeking an arrangement with a joint venture partner that would provide
the required funding in exchange for receiving a part interest in the Q29
property. We have not undertaken any efforts to locate a joint venture partner.
There is no guarantee that we will be able to locate a joint venture partner who
will assist us in funding exploration expenditures upon acceptable terms. We may
also pursue acquiring interests in alternate mineral properties in the future.
If we are unable to arrange additional financing or find a joint venture partner
for the Q29 property, our business plan will fail and operations will cease.
Results of Operations For the Year Ended December 31, 2007
We did not earn any revenues during the year ending December 31, 2007. At
December 31, 2007, we had an accumulated deficit of $86,915 and a working
capital deficiency of $57,315.
In 2007, our operating expenses in consisted of $6,304 in professional fees and
$1,674 in office and general costs.
As at December 31, 2007, we had $284 in cash and liabilities totaling $57,599
consisting of accounts payable and accrued liabilities of $6,990 and $50,609 due
to our president, Scott Taylor, for loans to us.
We have not generated any revenue since inception and are dependent upon
obtaining financing to pursue exploration activities. For these reasons, our
auditors believe that there is substantial doubt that we will be able to
continue as a going concern.
11
ITEM 8. FINANCIAL STATEMENTS.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and Board of Directors of Mondial Ventures Inc.
We have audited the accompanying balance sheets of Mondial Ventures Inc. (a
development stage company) as of December 31, 2006 and 2005 and the related
statements of operations, stockholders' deficit and cash flows for the years
ended December 31, 2006 and 2005 and the period from May 29, 2002 (inception)
through December 31, 2006. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform an audit to obtain reasonable assurance whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, these financial statements present fairly, in all material
respects, the financial position of Mondial Ventures Inc. as of December 31,
2006 and 2005 and the results of its operations and its cash flows for the years
ended December 31, 2006 and 2005 and the period from May 29, 2002 (inception)
through December 31, 2006 in conformity with accounting principles generally
accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company is in the development stage and has incurred
losses since inception and has limited working capital available raising
substantial doubt about the Company's ability to continue as a going concern.
The ability of the Company to continue as a going concern is dependent on
raising capital to fund its business plan and ultimately to attain profitable
operations. Management's plans in regard to these matters are also described in
Note 1. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
"DMCL"
Dale Matheson Carr-Hilton Labonte llp
CHARTERED ACCOUNTANTS
Vancouver, Canada
March 10, 2007
12
Stan J.H. Lee, CPA
2160 North Central Rd. Suite 203 Fort Lee NJ 07024
P.O. Box 436402 San Ysidro CA 92143
619-623-7799 Fax 619-564-3408 E-mail) stan2u@gmail.com
Report of Independent Registered Public Accounting Firm
-------------------------------------------------------
To the Board of Directors and
Shareholders of
Mondial Ventures Inc.
We have audited the accompanying balance sheets of Mondial Ventures Inc. as of
December 31, 2007 and the related statements of operations, changes in
shareholders' equity and cash flows for the year then ended and since May 29,
2002 ( its inception)for its cumulative presentation. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits. The
December 31, 2006 financial statements of Mondial Ventures Inc. ere audited by
other auditors whose report dated March 10, 2007, expressed an unqualified
opinion on those statements. Their report included an explanatory paragraph
regarding going concern.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Mondial Ventures Inc. as of
December 31, 2007 and the results of their operations and its cash flows for the
fiscal year then and since May 20, 2002 ( its inception)for its cumulative
presentation in conformity with U.S. generally accepted accounting principles.
The financial statements have been prepared assuming that the Company will
continue as a going concern. As discussed in Note 1 to the financial statements,
the Company's results of operations and lack of capital and liquidity raise
substantial doubt about its ability to continue as a going concern. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
/s/ Stan J.H. Lee, CPA
------------------
Stan J.H. Lee, CPA
April 21, 2010
Fort Lee, NJ 07024
13
MONDIAL VENTURES, INC.
Balance Sheets
(An Exploration Stage Company)
December 31, December 31,
2007 2006
(audited) (audited)
------------- -------------
Assets
Cash $ 284 $ 3,960
------------- -------------
Total current assets 284 3,960
------------- -------------
Total assets $ 284 $ 3,960
============= =============
Liabilities and Stockholders' Equity (Deficit)
Current liabilities:
Accounts Payable and accrued Liabilities $ 6,990 $ 13,685
Note payable - related party 50,609 39,609
------------- -------------
Total current liabilities 57,599 53,294
------------- -------------
Commitments and contingencies
Stockholders' equity (deficit):
Common stock, $.001 par value; 75,000,000
shares authorized, authorized, 9,800,000
shares issued and outstanding respectively 9,800 9,800
Additional paid-in capital 19,800 19,800
Deficit accumulated during exploration stage (86,915) (78,934)
------------- -------------
Total stockholders' equity (deficit) (57,315) (49,334)
------------- -------------
Total liabilities and stockholders'
equity (deficit) $ 284 $ 3,960
============= =============
The accompanying notes are an integral part of these financial statements
14
MONDIAL VENTURES, INC.
Statements of Operations
(An Exploration Stage Company)
May 29,
2002
(Inception)
Through
December 31, December 31
2007 2006 2007
------------- ------------- -------------
Revenue -- -- --
Operating expenses:
Mineal Property Acquisition -- -- 12,000
Office and general 1,674 3,676 12,468
Professional expense 6,307 18,562 62,447
------------- ------------- -------------
Total operating expenses $ 7,981 $ 22,238 $ 86,915
------------- ------------- -------------
Net income (Loss) (7,981) (22,238) (86,915)
============= ============= =============
Basic and diluted loss per share $ -- $ --
============= =============
Basic and diluted weighted average
common shares outstanding 9,800,000 9,800,000
============= =============
Diluted weighted average common
shares outstanding 9,800,000 9,800,000
The accompanying notes are an integral part of these financial statements
15
MONDIAL VENTURES, INC.
Statement in Changes in Stockholders' Equity
(An Exploration Stage Company)
Other
Compre-
Additional hensive
Common Stock Paid-In Accumulated Income
Shares Par Value Capital Deficit (Loss) Total
------------- ------------- ------------- ------------ ------------ ------------
Balance at May 22, 2002 and
December 31, 2002 -- $ -- $ -- $ -- $ -- $ --
Issuance of common stock for
cash at $.001 per share
December 2003 9,600,000 9,600 -- -- -- 9,600
Issuance of common stock for
cash at $.001 per share
December 2003 200,000 200 19,800 -- 20,000
Net loss for the year ending
December 31, 2003 (5,527) (5,527)
------------- ------------- ------------- ------------ ------------ ------------
Balance at December 31, 2003 9,800,000 9,800 19,800 -- -- 24,073
Net loss for the year ending
December 31, 2004 (35,841) (35,841)
------------- ------------- ------------- ------------ ------------ ------------
Balance at December 31, 2004 9,800,000 9,800 19,800 (41,368) -- (11,768)
Net loss for the year ending
December 31, 2005 (15,328) (15,328)
------------- ------------- ------------- ------------ ------------ ------------
Balance at December 31, 2005 9,800,000 9,800 19,800 (56,696) -- (27,096)
Net loss for the year ending
December 31, 2006 (22,238) (22,238)
------------- ------------- ------------- ------------ ------------ ------------
Balance at December 31, 2006 9,800,000 9,800 19,800 (78,934) -- (49,334)
Net loss for the year ending
December 31, 2007 (7,981) (7,981)
------------- ------------- ------------- ------------ ------------ ------------
Balance at December 31, 2007 9,800,000 $ 9,800 $ 19,800 $ (86,915) $ -- $ (57,315)
============= ============ ============= ============ ============ ============
The accompanying notes are an integral part of these financial statements
16
MONDIAL VENTURES, INC.
Statements of Cash Flows
(An Exploration Stage Company)
May 29,
2002
(Inception)
Through
December 31, December 31
2007 2006 2007
------------- ------------- -------------
Cash flows from operating activities:
Net loss $ (7,981) $ (22,238) $ (86,915)
Adjustments to reconcile net
loss to net cash used
in operating activities:
Increase in Accounts Payable (6,695) 6,234 6,990
------------- ------------- -------------
Net cash provided by
(used in) operations (14,676) (15,995) (79,925)
Cash flows from (used in)
investing activities:
------------- ------------- -------------
Net cash used in
investing activities -- -- --
------------- ------------- -------------
Cash flows from financing activities:
Loan from officer/shareholder -- --
Loan from related party 11,000 19,408 50,609
Issuance of common stock -- -- 29,600
------------- ------------- -------------
Net cash provided by
financing activities 11,000 19,408 80,209
------------- ------------- -------------
Net change in cash (3,676) 3,413 284
Cash, beginning of period 3,960 547 --
------------- ------------- -------------
Cash, end of period $ 284 $ 3,960 $ 284
Supplemental disclosure of cash
flow information:
Interest paid $ -- -- $ --
Income taxes paid $ -- $ -- $ --
The accompanying notes are an integral part of these financial statements
17
MONDIAL VENTURES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
December 31, 2007
Note 1 Nature and Continuance of Operations
The Company was incorporated in the State of Nevada on May 29, 2002 and is in
the business of acquisition and exploration of mineral properties. The Company
is considered to be in the exploration stage with respect to its mineral
property.
The Company has acquired a mineral property located in the Province of British
Columbia, Canada and has not yet determined whether this property contains
reserves that are economically recoverable. The recoverability of amounts from
the property will be dependent upon the discovery of economically recoverable
reserves, confirmation of the Company's interest in the underlying property, the
ability of the Company to obtain necessary financing to satisfy the expenditure
requirements under the property agreement and to complete the development of the
property and upon future profitable production or proceeds for the sale thereof.
Going Concern
The Company commenced operations on May 29, 2002 and has not realized any
revenues since inception. At December 31, 2007, the Company had an accumulated
deficit of $86,915 and a working capital deficiency of $57,315. The ability of
the Company to continue as a going concern is dependent on raising capital to
fund its business plan and ultimately to attain profitable operations.
Accordingly, these factors raise substantial doubt as to the Company's ability
to continue as a going concern. The Company to date has funded its operations
through the issuance of common and advances from a director. Management plans to
raise additional funds through issuance of additional capital stock and advances
from directors.
Note 2 Summary of Significant Accounting Policies
Basis of Presentation
The financial statements of the Company have been prepared in conformity with
generally accepted accounting principles in the United States of America and are
stated in US dollars.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles in the United States of America requires management to
make estimates and assumptions that affect the reported amount of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amount of revenues and expenses
during the reporting period. Actual results could differ from these estimates.
18
MONDIAL VENTURES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
December 31, 2007
Foreign Currency Translation
Transaction amounts denominated in foreign currencies are translated at exchange
rates prevailing at transaction dates. Carrying values of monetary assets and
liabilities are adjusted at each balance sheet date to reflect the exchange rate
at that date. Non-monetary assets and liabilities are translated at the exchange
rate on the original transaction date. Gains and losses from restatement of
foreign currency assets and liabilities are included in the statements of
operations. Revenues and expenses are translated at the rates of exchange
prevailing on the dates such items are recognized in the statements of
operations.
Mineral Property
The Company is primarily engaged in the acquisition, exploration and development
of mineral properties. Mineral property acquisition costs are capitalized in
accordance with EITF 04-2 when management has determined that probable future
benefits consisting of a contribution to future cash inflows, have been
identified and adequate financial resources are available or are expected to be
available as required to meet the terms of property acquisition and budgeted
exploration and development expenditures. Mineral property acquisition costs are
expensed as incurred if the criteria for capitalization is not met. Mineral
property exploration costs are expensed as incurred. When it has been determined
that a mineral property can be economically developed as a result of
establishing proven and probable reserves, the costs incurred to develop such
property are capitalized. As of the date of these financial statements, the
Company has incurred only acquisition and exploration costs which have been
expensed. To date the Company has not established any proven or probable
reserves on its mineral properties.
Impairment of Long-lived Assets
Long-lived assets are reviewed for impairment in accordance with SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-lived Assets", which was
adopted effective January 1, 2002. Under SFAS No. 144, these assets are tested
for recoverability whenever events or changes in circumstances indicate that
their carrying amounts may not be recoverable. An impairment charge is
recognized for the amount, if any, which the carrying value of the asset exceeds
the fair value.
Financial instruments
The Company's financial instruments consist of cash, accounts payable and
accrued liabilities and advances from related party. The fair values of these
financial instruments approximate their carrying values due to the short-term
maturity of those instruments. In management's opinion, the Company is not
exposed to significant interest rate, currency exchange rate or credit risk
arising from these financial instruments. The Company is not party to any
derivative instruments.
19
MONDIAL VENTURES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
December 31, 2007
Income Taxes
The Company follows the liability method of accounting for income taxes. Under
this method, deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement
carrying amounts of assets and liabilities and their respective tax balances.
Deferred tax assets and liabilities are measured using enacted or substantially
enacted tax rates expected to apply to the taxable income in the years in which
those differences are expected to be recovered or settled. The effect on
deferred tax assets and liabilities of a change in tax rates is recognized in
income in the period that includes the date of enactment or substantive
enactment. A valuation allowance is provided for deferred tax assets if it is
more likely than not that the Company will not realize the future benefit.
Net Loss per Share
Basic loss per share includes no dilution and is computed by dividing loss
available to common stockholders by the weighted average number of common shares
outstanding for the period. Dilutive losses per share reflects the potential
dilution of securities that could share in the losses of the Company. Because
the Company does not have any potentially dilutive securities, the basic loss
per share equals the dilutive loss per share.
Stock-based Compensation
The Company has not adopted a stock option plan and has not granted stock
options. Accordingly, no stock-based compensation has been recorded to date
Recent Accounting Pronouncements
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measures". This
Statement defines fair value, establishes a framework for measuring fair value
in generally accepted accounting principles (GAAP), expands disclosures about
fair value measurements, and applies under other accounting pronouncements that
require or permit fair value measurements. SFAS No. 157 does not require any new
fair value measurements. However, the FASB anticipates that for some entities,
the application of SFAS No. 157 will change current practice. SFAS No. 157 is
effective for financial statements issued for fiscal years beginning after
November 15, 2007, which for the Company would be the fiscal year beginning
January 1, 2008. The Company is currently evaluating the impact of SFAS No. 157
but does not expect that it will have a material impact on its financial
statements.
20
MONDIAL VENTURES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
December 31, 2007
In September 2006, the FASB issued SFAS No. 158, "Employers' Accounting for
Defined Benefit Pension and Other Postretirement Plans." This Statement requires
an employer to recognize the over funded or under funded status of a defined
benefit post retirement plan (other than a multiemployer plan) as an asset or
liability in its statement of financial position, and to recognize changes in
that funded status in the year in which the changes occur through comprehensive
income. SFAS No. 158 is effective for fiscal years ending after December 15,
2006 which for the Company was December 31, 2006. The adoption of this statement
had no effect on the Company's financial position or results of operations.
In November 2007, FASB issued SFAS No. 159, "The Fair Value Option for Financial
Assets and Financial Liabilities--Including an amendment of FASB Statement No.
115." SFAS No. 159 requires, among other things, that a company to choose to
measure many financial instruments and certain other items at fair value. The
objective is to improve financial reporting by providing entities with the
opportunity to mitigate volatility in reported earnings caused by measuring
related assets and liabilities differently without having to apply complex hedge
accounting provisions. SFAS is effective for financial statements issued for
fiscal years beginning after November 15, 2007. The Company does not expect the
adoption of SFAS No. 159 to have a material effect on its financial condition or
results of operations.
In November 2007, FASB issued SFAS No. 160, "Non-controlling Interests in
Consolidated Financial Statements--an amendment of ARB No. 51." SFAS No. 160
requires, among other things, that companies record a non-controlling interest,
sometimes called a minority interest, is the portion of equity in a subsidiary
not attributable, directly or indirectly, to a parent. This Statement is
effective for fiscal years, and interim periods within those fiscal years,
beginning on or after December 15, 2008. The Company does not expect the
adoption of SFAS No. 160 to have a material effect on its financial condition or
results of operations.
In January 2008, Staff Accounting Bulletin ("SAB") 110, "Share Based Payment"
was issued. Registrants may continue, under certain circumstances to use the
simplified method in developing estimates of the expected term of share options
as initially allowed by SAB 107, "Share Based Payment". The adoption of SAB 110
should have no effect on the financial position and results of the Company.
In March 2008, FASB issued SFAS 161, Disclosure about Derivative Instruments and
Hedging Activities - an amendment to improve financial standards for derivative
instruments and hedging activities by requiring enhanced disclosures to enable
investors to better understand their effects on an entity's financial position,
financial performance and cash flows entities are required to provide enhanced
disclose about (a) how and why an entity uses derivative instruments; (b) how
derivative instruments an related hedged items are accounted for under Statement
133 and its related interpretations: and (c) how derivative instruments and
related hedged items affect an entity's financial position, financial
performance, and cash flows. It is effective for financial statements issued for
fiscal years beginning after November 15, 2008 with early adoption encouraged.
The Company is currently evaluating the impact of SFAS No. 161 on its financial
statements.
21
MONDIAL VENTURES, INC.
(An Exploration Stage Company)
NOTES TO FINANCIAL STATEMENTS
December 31, 2007
Note 3 Mineral Property
Mineral Claims, Port Alice
Pursuant to a mineral property purchase agreement dated December 22, 2003, the
Company acquired a 100% undivided right, title and interest in and to four
mineral claims located in Port Alice, British Columbia for $6,000, paid by the
Company upon closing of this agreement on January 5, 2004. An additional $6,000
was paid for mineral property consulting services. The property is subject to a
2% net smelter returns royalty payable to the vendor. In October 2008 title to
the properties lapsed as the company lacked the funds to complete necessary
work. In December 2009, the company was able to borrow funds from a shareholder
and restaked the claims.
Note 4 Related Party Transactions
At December 31, 2007, the Company was indebted in the amount of $50,609 (2005 -
$20,201) to a director for cash advances and expenses paid on behalf of the
Company. These amounts are unsecured, bear no interest and have no specified
terms of repayment.
All related party amounts are in the normal course of operations and are
measured at the exchange amount, which is the amount of consideration
established and agreed to by the related parties.
Note 5 Common Stock
The Company is authorized to issue 75,000,000 common shares with a par value of
$0.001 and has issued 9,800,000 shares as at December 31, 2007.
Note 6 Income Taxes
A reconciliation of income taxes at statutory rates with the reported taxes is
as follows:
2007 2006
------------- -------------
Net loss $ (7,981) $ (22,328)
============= =============
Expected income tax recovery $ 2,356 $ 11,840
Unrecognized current benefit of
operating losses (2,356) (11,840)
------------- -------------
Total income taxes $ - $ -
============= =============
The Company has available for deduction, against deferred taxable income
operating losses of approximately $86,915. These losses, if not utilized, will
expire commencing in 2026. Future tax benefits which may arise as a result of
these operating losses have been offset by a valuation allowance and have not
been recognized in these financial statements.
Note 7 Subsequent Events
On December 14, 2009, Marc Juliar purchased 6,000,000 shares of common stock of
the company in a private transaction from Scott Taylor.
On January 28, 2010 Scott Taylor resigned as the President and a director of the
Company. On January 28, 2010 Marc Juliar was appointed as President of the
Company by the Board of Directors.
22
ITEM 9. CHANGES IN & DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING & FINANCIAL
DISCLOSURE
On January 21,2009 the board of directors of the Company replaced DMCL with Stan
G. H. Lee CPA, as our auditors. There have been no disagreements with our
accountants on issues of accounting or financial disclosure.
ITEM 9A(T). CONTROLS AND PROCEDURES
a) Evaluation of Disclosure Controls and Procedures
The Company's management, with the participation of its President and Chief
Executive Officer, who is its principal executive officer, completed an
evaluation of the effectiveness of the design and operation of the Company's
disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as amended (the "Exchange Act") as of
the end of the period covered by this Form 10-K. Disclosure controls and
procedures are designed to ensure that information required to be disclosed by
the Company in reports that it files or submits under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified
by the SEC rules and forms, and that such information is accumulated and
communicated to management, including the President and Chief Executive Officer,
as appropriate, to allow timely decisions regarding required disclosures. Based
on that evaluation, the Company's President and Chief Executive Officer
concluded that the Company's disclosure controls and procedures, as of the end
of the fiscal year covered by this Form 10-K, were effective.
(b) Management's Annual Report on Internal Control over Financial Reporting
The Company's management is responsible for establishing and maintaining
adequate internal control over financial reporting as defined in Rules 13a-15(f)
and 15d-15(f) of the Exchange Act and for assessing the effectiveness of
internal control over financial reporting.
Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. In addition, projections of any
evaluation of effectiveness of internal control over financial reporting to
future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
Management has assessed the effectiveness of the Company's internal control over
financial reporting as of December 31, 2007. In making its assessment of
internal control over financial reporting, management used the criteria
established in Internal Control -- Integrated Framework, issued by the Committee
of Sponsoring Organizations of the Treadway Commission. This assessment included
an evaluation of the design of the Company's internal control over financial
reporting and testing of the operational effectiveness of those controls. Based
on the results of this assessment, management has concluded that the Company's
internal control over financial reporting was effective as of December 31, 2007.
This Annual Report on Form 10-K does not include an attestation report of the
Company's registered public accounting firm regarding internal control over
financial reporting. Management's report was not subject to attestation by the
Company's registered public accounting firm pursuant to rules of the SEC that
permit the Company to provide only management's report in this Annual Report on
Form 10-K.
(c) Changes in Internal Control over Financial Reporting
There were no changes in the Company's internal control over financial reporting
that occurred during the fourth quarter of the year ended December 31, 2007 that
have materially affected, or that are reasonably likely to materially affect,
the Company's internal control over financial reporting.
23
ITEM 9B. OTHER INFORMATION
None
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
All directors of our company hold office until the next annual general meeting
of the shareholders or until their successors are elected and qualified. The
officers of our company are appointed by our board of directors and hold office
until their earlier death, retirement, resignation or removal.
Our directors, executive officers and other significant employees, their ages,
positions held and duration each person has held that position, are as follows:
============== ================================ ===== ==========================
Name Position Held with the Age Date First Elected / Appointed
Corporation
============== ================================ ===== ==========================
Scott Taylor President and Director 27
============== ================================ ===== ==========================
Joe Alvaro Chief Financial Officer 59
and Director
-------------- -------------------------------- ----- --------------------------
Business Experience
The following is a brief account of the education and business experience of
each director, executive officer and key employee during at least the past five
years, indicating each person's principal occupation during the period, and the
name and principal business of the organization by which he was employed.
Biographical Information
Mr. Scott Taylor has acted as our President, chief executive officer promoter
and as a director since our incorporation. Mr. Taylor is a graduate of Touro
College in Moscow, Russia, receiving his Bachelor of Science degree in science
finance in January 2004. As part of his degree requirement, Mr. Taylor completed
a thesis in international diamond mining ventures in northern Russia. Part of
Mr. Taylor's undergraduate work was completed at the University of Economics in
Barcelona, Spain, Franklin College in Lugano, Switzerland, the University of
Calgary and the University of British Columbia.
From January to December 2002, Mr. Taylor acted as a business development
consultant for Delta Financial Group in Moscow, Russia where he established a
customer service training program for the company's loan officers and analyzed
expansion and marketing efforts. From January to August 2003, Mr. Taylor was
employed as a research and financial analyst with Al-Toukhi Group, a private
company based in Dubai and Alberta. As part of his duties, Mr. Taylor researched
and compiled data on various Alberta oil sands projects.
From October 2003 until December 2004, Mr. Taylor was employed as a venture
capital consultant with Resourcex Capital, a private British Columbia business
involved in organizing and acquiring gold, diamond and oil and gas projects in
South America and Russia.
In January 2005 he jointly set up a trading company in Lugano which primarily
focuses on locating specialized treated steel products from Russia for the North
American Nuclear and Petroleum Industry. From May 2005 until present he has been
employed as an executive at the Weir-Jones Group, which is an established
engineering firm. The Weir-Jones group manufactures specialized equipment for
the Marine, Oil & Gas, Mining, Civil Construction, and Defence Industries.
Specifically within the mining industry the company designs and re-mediates
mines in several countries.
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Mr. Taylor intends to devote 20 hours of his business time per week to our
affairs.
Mr. Joe Alvaro has acted as our secretary, treasurer and as a director since our
incorporation. For over 30 years, he has been employed as a superintendent at
York Sheet Metal, a Burnaby, British Columbia based commercial construction
company that supplies and installs air conditioning, heating and sheet metal
products. He employment tasks include overseeing workers and materials for
specific contracts.
Mr. Alvaro intends to devote five hours of his business time per week to our
affairs.
Our directors, executive officers and control persons have not been involved in
any of the following events during the past five years:
1. any bankruptcy petition filed by or against any business of which
such person was a general partner or executive officer either at the
time of the bankruptcy or within two years prior to that time;
2. any conviction in a criminal proceeding or being subject to a
pending criminal proceeding (excluding traffic violations and other
minor offences);
3. being subject to any order, judgment, or decree, not subsequently
reversed, suspended or vacated, of any court of competent
jurisdiction, permanently or temporarily enjoining, barring,
suspending or otherwise limiting his involvement in any type of
business, securities or banking activities; or
4. being found by a court of competent jurisdiction (in a civil
action), the Commission or the Commodity Futures Trading Commission
to have violated a federal or state securities or commodities law,
and the judgment has not been reversed, suspended, or vacated.
Mondial does not have any committees of the board of directors at this time. The
board of directors does not have a nominations committee because there is one
director and shareholder suggestions would be known to the entire board. As
such, the board of directors believes there will be sufficient communication by
shareholders with the board about matters and nominees to be brought to its
attention.
Mondial's directors functions as an audit committee and performs some of the
same functions as an audit committee including: (1) selection and oversight of
the Company's independent accountant; (2) establishing procedures for the
receipt, retention and treatment of complaints regarding accounting, internal
controls and auditing matters; and (3) engaging outside advisors. Mondial's
board of directors has determined that its director is not an "audit committee
financial expert" within the meaning of the rules and regulations of the SEC.
Mondial's board of directors has determined, however, that its director is able
to read and understand fundamental financial statements and has business
experience that results in that member's financial sophistication. Accordingly,
the board of directors believes that its director has the sufficient knowledge
and experience necessary to fulfill the duties and obligations that an audit
committee would have.
ITEM 11. EXECUTIVE COMPENSATION.
Summary Compensation Table
The following table sets forth information concerning all compensation paid or
accrued by us to our President and Chief Executive Officer, during the fiscal
year ended December 31, 2007. None of the officer receives compensation in
excess of $100,000 per year.
Long-Term
Annual Compensation
Compensation Awards
Name and Fiscal Stock All Other
Principal Position Year Salary Bonus Option Compen-
Granted sation
----------------------------------------------------------------------------
Scott Taylor 2009 $0 -- -- --
President 2008 $0 -- -- --
2007 $0
2006 $0
Joe Alvaro 2009 $0
2008 $0
2007 $0
2006 $0
Stock Option Grants
During the year ended December 31, 2007, we did not grant any stock options or
stock appreciation rights to any of our directors or officers. There are
currently no stock options or stock appreciation rights outstanding.
Options Exercised and Year-End Option Values
The following table sets forth certain information regarding the value of
unexercised options held by the named executive officer as of December 31, 2007.
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Fiscal Year-End Option Values(1)
Shares Value
Acquired Realized Number of Shares Value of Unexercised
upon From Underlying Unexercised In-the-Money Options
Exercise of Exercise Options at December 31, 2008 at December 31, 2008
Name Options Of Options Exercisable Unexercisable Exercisable Unexercisable
Scott Taylor -- -- -- -- $ -- $ --
Stock Option Plan
Mondial has no stock option plan for officers, directors, employees or
consultants and no options have been issued.
Compensation of Directors
The Company does not pay any compensation to directors.
Director Compensation
Non-equity Nonqualified
Fees incentive deferred All
earned plan compen- other
or paid Stock Option compen- sation compen-
in cash awards awards sation earnings sation Total
Name ($) ($) ($) ($) ($) ($) ($)
Scott
Taylor $ 0 -- -- -- -- -- $ 0
Joe
Alvaro $ 0 -- -- -- -- -- $ 0
We have no plan for compensating our directors for their service. Directors are
entitled to reimbursement for reasonable travel and other out-of-pocket expenses
incurred in connection with attendance at meetings of our board of directors.
Our board of directors may award special remuneration to any director
undertaking any special services on our behalf other than services ordinarily
required of a director. No director received and/or accrued any compensation for
their services as a director, including committee participation and/or special
assignments.
Employment Agreements
There are no other management agreements with our directors or executive
officers and we do not anticipate that written agreements will be put in place
in the foreseeable future.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT &
RELATED STOCKHOLDER MATTERS.
The following table sets forth, as of December 31, 2007, certain information
with respect to the beneficial ownership of our common shares by each
shareholder known to us to be the beneficial owner of 5% of our common shares,
and by each of our officers and directors. Each person has sole voting power
with respect to the common shares, except as otherwise indicated. Beneficial
ownership consists of a direct interest in the common shares, except as
otherwise indicated.
=============================================================================
Name and Address of Amount and Nature of Percentage of Class(1)
Beneficial Owner Beneficial Ownership
=============================================================================
Scott Taylor 3,000,000 30.06%
------------------------------------------------------------------ ----------
Joe Alvaro 3,000,000 30.06%
=============================================================================
Directors and Officers 6000,000 60.12
(as a group)
=============================================================================
(1) Based on 9,800,000 shares outstanding as of December 31, 2007 and,
as to a specific person, shares issuable pursuant to the conversion
or exercise, as the case may be, of currently exercisable or
convertible debentures, share purchase warrants and stock options
within 60 days.
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
In 2007 related parties were owed $50,609 by the corporation. There are
currently no terms of repayment for this outstanding amount.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The following table presents fees for professional services rendered by DMCL for
the audit of the Company's financial statements as of the year end December 31,
2007 and fees billed for other services rendered by STS Partners during those
periods.
Years Ended
2007 2006
-----------------------
Audit Fees $ 5,057 $12,000
Audit Related Fees $ - $ -
Tax Fees $ - $ -
All other Fees $ - $ -
Audit fees consist of fees related to professional services rendered in
connection with the audit of our annual financial statements. All other fees
relate to professional services rendered in connection with the review of the
quarterly financial statements.
Our policy is to pre-approve all audit and permissible non-audit services
performed by the independent accountants. These services may include audit
services, audit-related services, tax services and other services. Under our
audit committee's policy, pre-approval is generally provided for particular
services or categories of services, including planned services, project based
services and routine consultations. In addition, the audit committee may also
pre-approve particular services on a case-by-case basis. Our audit committee
approved all services that our independent accountants provided to us in the
past two fiscal years.
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
a) The following documents are filed as a part of this Report:
1. Financial Statements. The following financial statements of Mondial
Ventures, Inc. are included in Item 8:
Report of Independent Registered Public Accounting Firm.
Balance Sheets as of June 30, 2007 and 20068.
Statements of Operations for the year ended June 30, 2007, for the year ended
June 30, 2006 and for the period May 29, 2002 through December 31, 2007.
Statements of Stockholders' Equity (Deficit) for the year ended December 31,
2007, for the year ended December 31, 2006 and for the period May 29, 2002
through December 31, 2009.
Statements of Cash Flows for the year ended December 31, 2007, for the year
ended December 31, 2006 and for the period May 29, 2002 through December 31,
2009.
Notes to Financial Statements.
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2. Financial Statement Schedule(s):
All schedules are omitted for the reason that the information is included in the
financial statements or the notes thereto or that they are not required or are
not applicable.
The following are exhibits to this Annual Report
31.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C.
Section 1350, as Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2003.
32.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C.
Section 1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2003.
SIGNATURES
Pursuant to the requirements of Section 13 and 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.
Dated: May 7, 2010
MONDIAL VENTURES, INC.
/s/ Marc Juliar
---------------------------
Marc Juliar
President, Chief Executive Officer and Director
(Principal Executive Officer)
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