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EX-32 - CERTIFICATION - AMERICAN INTERNATIONAL VENTURES INC /DE/ex32.htm
EX-31 - CERTIFICATION - AMERICAN INTERNATIONAL VENTURES INC /DE/ex312.htm
EX-31 - CERTIFICATION - AMERICAN INTERNATIONAL VENTURES INC /DE/ex311.htm


UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q


 

 

 

x

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended August 31, 2016

OR

o

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Commission File Number 000-30368


American International Ventures, Inc.

(Name of Small Business Issuer in its charter)


 

 

 

Delaware

 

22-3489463

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

 

 

15122 Tealrise Way

Lithia, Florida

 


33547

(Address of principal executive offices)

 

(Zip Code)


 

(813) 260-2866

(Registrant’s telephone number, including area code)


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 proceeding 12 months and (2) has been subject to such filing requirements for the past 90 days.    x Yes o No


Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     x Yes o 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 and smaller reporting company in Rule 12b-2 of the Exchange Act.

  

Large accelerated filer  o    Accelerated filer   o    Non-accelerated filer  o    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)   o Yes x No


Indicate the number of shares outstanding of each of the issuers classes of common stock, as of September 13, 2016: 213,399,945 shares of Common Stock, $.00001 par value.



1





TABLE OF CONTENTS



PART I – FINANCIAL INFORMATION

3

Item 1. Financial Statements

3

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

8

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

10

Item 4. Controls and Procedures.

10

PART II – OTHER INFORMATION

11

Item 1. Legal Proceedings.

11

Item 1A. Risk Factors.

11

Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.

11

Item 3. Defaults Upon Senior Securities.

11

Item 4. Mine Safety Disclosures.

11

Item 5. Other Information.

11

Item 6. Exhibits

11











2





PART I – FINANCIAL INFORMATION

Item 1.  Financial Statements

AMERICAN INTERNATIONAL VENTURES, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

August 31, 2016

 

May 31, 2016

 

ASSETS

 

 

 

 

Current Assets

 

 

 

 

Cash

$                89,797

 

$           146,296

 

Miscellaneous receivables

46,937

 

8,373

 

Total current assets

136,734

 

154,669

 

 

 

 

 

 

Fixed Assets

 

 

 

 

Vehicles

150,039

 

150,039

 

Mining equipment

502,400

 

502,400

 

Office furniture and equipment

32,444

 

32,444

 

Total assets

684,883

 

684,883

 

Less accumulated depreciation

388,410

 

363,027

 

Net fixed assets

296,473

 

321,856

 

 

 

 

 

 

Other Assets

 

 

 

 

Investment in securities

6,380

 

6,380

 

Mining claims

911,707

 

911,707

 

Total other assets

918,087

 

918,087

 

TOTAL ASSETS

$           1,351,294

 

$        1,394,612

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

Current Liabilities

 

 

 

 

Current portions of notes payable

$                10,178

 

$             13,465

 

Accounts payable and accrued expenses

154,601

 

98,578

 

Taxes payable

59,600

 

60,777

 

Advances from officers and directors

75,994

 

75,994

 

Total current liabilities

300,373

 

248,814

 

 

 

 

 

 

Long Term Liabilities

 

 

 

 

Long term portions of notes payable

2,331

 

2,331

 

Warrant liability

27,150

 

27,150

 

 

 

 

 

 

Total long term liabilities

29,481

 

29,481

 

 

 

 

 

 

Total Liabilities

329,854

 

278,295

 

 

 

 

 

 

Stockholders' Equity

 

 

 

 

Common stock - authorized, 400,000,000 shares of $.00001 par value; issued and outstanding, 213,399,945 and 211,649,945 shares, respectively

2,134

 

2,116

 

Additional paid in capital

7,378,190

 

7,345,580

 

Accumulated  deficit

(6,318,124)

 

(6,197,643)

 

Total American International Ventures, Inc.  stockholders’ equity

1,062,200

 

1,150,053

 

Non controlling interest

(40,760)

 

(33,736)

 

Total stockholders' equity

1,021,440

 

1,116,317

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$           1,351,294

 

$         1,394,612

 

 

 

The accompanying notes are an integral part of these financial statements.



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AMERICAN INTERNATIONAL VENTURES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

 

 

 

 

Three Month Periods Ended August 31,

 

 

 

2016

 

2015

 

 

 

 

 

 

 

 

Sales

$            26,911

 

$                  -

 

 

Cost of goods sold

22,364

 

-

 

 

Gross profit

4,547

 

-

 

 

 

 

 

 

 

 

Administrative expenses

131,816

 

59,212

 

 

Operating loss

(127,269)

 

(59,212)

 

 

 

 

 

 

 

 

Other Income and Expense:

 

 

 

 

 

Other income

4

 

-

 

 

Interest expense

(240)

 

(9,264)

 

 

Total other income (expense)

(236)

 

(9,264)

 

 

 

 

 

 

 

 

Net loss before taxes

(127,505)

 

(68,476)

 

 

Provision for income taxes

-

 

-

 

 

Net Loss

(127,505)

 

(68,476)

 

 

 

 

 

 

 

 

Net loss attributable to non controlling interest

(7,024)

 

(1,324)

 

 

Net loss attributable to American International Ventures, Inc.

(120,481)

 

(67,152)

 

 

 

 

 

 

 

 

Other comprehensive income:

 

 

 

 

 

Exchange rate changes

-

 

-

 

 

Attributable to non controlling interest

-

 

-

 

 

Net other comprehensive income

-

 

-

 

 

Total Comprehensive loss

$        (127,505)

 

$          (68,476)

 

 

 

 

 

 

 

 

Net Loss Per Share – basic and diluted

$                      -

 

$                      -

 

 

 

 

 

 

 

 

Weighted Average Number of Shares Outstanding

212,867,336

 

214,888,532

 

 

 

 

 

 

 

 








The accompanying notes are an integral part of these financial statements.



4






 

 

 

 

AMERICAN INTERNATIONAL VENTURES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

 

 

Three Month Periods Ended August 31,

 

2016

 

2015

Cash Flows From Operating Activities:

 

 

 

Net loss

$        (127,505)

 

$         (68,476)

Adjustments to reconcile net loss to net cash consumed by operating activities:

 

 

 

Charges not requiring an outlay of cash:

 

 

 

Depreciation

25,383

 

25,581

Equity items issued for services

32,625

 

30,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Changes in assets and liabilities:

 

 

 

Increases  (decreases) in accounts payable and accrued expenses

56,023

 

(1,179)

Decreases in tax liability

(1,177)

 

(6,957)

(Increases) decreases in miscellaneous accounts receivable

(38,564)

 

958

Net cash consumed by operating activities

(53,215)

 

(19,323)

 

 

 

 

Cash Flows From Investing Activities

-

 

-

 

 

 

 

Cash Flows From Financing Activities:

 

 

 

 

 

 

 

Proceeds of shareholder loan

-

 

10,000

Payments on notes payable

(3,284)

 

(2,056)

Net Cash provided (consumed) by financing activities:

(3,284)

 

7,944

 

 

 

 

Effect on cash of exchange rate changes

-

 

-

Net change in cash

(56,499)

 

(11,379)

 

 

 

 

Cash balance, beginning of period

146,296

 

22,121

Cash balance, end of period

$     89,797

 

$    10,742













The accompanying notes are an integral part of these financial statements.




5



AMERICAN INTERNATIONAL VENTURES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

August 31, 2016

(Unaudited)




1. BASIS OF PRESENTATION


The unaudited interim consolidated financial statements of American International Ventures, Inc. ("the Company") as of August 31, 2016 and for the three month periods ended August 31, 2016 and 2015 have been prepared in accordance with accounting principles generally accepted in the United States of America. In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of such periods. The results of operations for the three month period ended August 31, 2016 are not necessarily indicative of the results to be expected for the full fiscal year ending May 31, 2017.


Certain information and disclosures normally included in the notes to financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission, although the Company believes the disclosure is adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements of the Company for the year ended May 31, 2016.


2. BACKGROUND


On March 23, 2012, the Company entered into a share exchange agreement with Placer Gold Prospecting, Inc. (“PGPI”), a Company that was formed on January 25, 2012. This share exchange agreement was  treated as a reverse recapitalization, under which the legal acquiree (Placer) was treated as the accounting acquirer and the equity accounts of the Company were adjusted to reflect a reorganization. Inasmuch as Placer was treated as the accounting acquireor, whenever historical financial information is presented, it is Placer information.


On May 3, 2013, the Company formed a subsidiary in Baja, California.  It remained inactive until June 1, 2013 at which time it became operational, on a limited basis.  A problem with the mining permit caused suspension of mining activities in May 2014.  The Company is working to resolve that problem.


3. GOING CONCERN AND LIQUIDITY


As shown in the accompanying financial statements, the Company has experienced losses since its inception.  It also had a working capital deficiency at August 31, 2016 and presently does not have sufficient resources to meet its outstanding liabilities or accomplish its objectives during the next twelve months. These factors raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue in operation.


4.  DEBT OBLIGATIONS


On August 31, 2014, the Company defaulted on its obligation for $25,000 of convertible notes.


5.  WARRANT LIABILITY


During the year ended May 31, 2013, the Company issued 2,715,000 warrants to an investment banker, which had "full-ratchet anti-dilution protection".  In accordance with pronouncements of the Financial Accounting Standards Board, these warrants have been classified as liabilities.  They will be periodically revalued by use of a Black Sholes valuation model.  Changes in the value will be recorded on the statement of operations.  During the three month periods ended August 31, 2016 and 2015, the value was not reduced.



6



AMERICAN INTERNATIONAL VENTURES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

August 31, 2016

(Unaudited)




6. CAPITAL STOCK


The following is a summary of stock activity during the quarter:


 

 

 

 

 

Shares

 

Amount

 

 

 

 

Balance May 31, 2016

211,649,945

 

$7,347,696

Shares issued for services

1,750,000

 

32,628

Balance August 31, 2016

213,399,945

 

$7,380,324


7. SUPPLEMENTARY CASH FLOW INFORMATION


There was $ 6,169 and $3,150, respectively, cash paid for interest during the three month periods ended August 31, 2016 and August 31, 2015; there was no cash paid for income taxes during either of the three month periods.


On June 16, 2014, the Company sold El Tule Canyon mining claim and the remainder of the Gypsy claim for 1,500,000 shares of restricted common stock of the buyer; these shares were valued at $1,500.  This brought to 6,500,000 the number of shares that were owned by the Company.  Subsequent sales reduced the number of share to 6,380,000.


8. WARRANTS


There were 2,715,000 warrants outstanding at August 31, 2016, as presented below:.


 

 

 

 

 

 

 

 

 

 

Number of Warrants

 

Exercise Price

 

Weighted Life (in Years)

 

 

  

 

 

2,715,000

 

$ .125    

 

2.96


These warrants were principally issued for services.  They were valued using a Black Scholes valuation model.


9. RELATED PARTY TRANSACTIONS


During the three month period ended August 31, 2016, the Company issued 1,750,000 shares (valued at $.019) to its directors and officers.  





7





Forward Looking Statements and Cautionary Statements .


Certain of the statements contained in this Quarterly Report on Form 10-Q include "forward looking statements." All statements other than statements of historical facts included in this Form 10-Q regarding the Company's financial position, business strategy, and plans and objectives of management for future operations and capital expenditures, and other matters, are forward looking statements. These forward-looking statements are based upon management's expectations of future events. Although the Company believes the expectations reflected in such forward looking statements are reasonable, there can be no assurances that such expectations will prove to be correct. Additional statements concerning important factors that could cause actual results to differ materially from our expectations ("Cautionary Statements") are disclosed in the Cautionary Statements section and elsewhere in the Company’s Form 10-K for the period ended May 31, 2016. Readers are urged to refer to the section entitled “Cautionary Statements” and elsewhere in the Company’s Form 10-K for a broader discussion of these statements, risks, and uncertainties. These risks include the Company’s limited operations and lack of revenues. In addition, the Company’s auditor, in his audit report for the fiscal year ended May 31, 2016, has expressed a “going concern” opinion about the future viability of the Company. All written and oral forward looking statements attributable to the Company or persons acting on the Company’s behalf subsequent to the date of this Form 10-Q are expressly qualified in their entirety by the referenced Cautionary Statements.


Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

During the three month period ended August 31, 2016, the Company had revenue of $26,911, compared with no revenue during the three month period of 2015.  These 2016 revenues were derived from mining activity of its subsidiary, AIVN de Mexico.  During the quarter ended August 31, 2016, AIVN de Mexico resumed mining operations, this time at newly acquired mining claims.  Cost of goods sold consisting of mining, milling and personnel costs was $22,364 during the three month period ended August 31, 2016.

Gross profit for the 2016 three month period was $4,547, compared with nothing in the 2016 period.

Administrative expenses for the three month period ended August 31, 2016 were $131,816 compared to $59,212 in the comparable period of 2015.  Administrative expenses consist primarily of consulting fees, director awards and other services compensated with equity items.  Administrative costs for the current period were affected by government fees to permit the Company to begin mining in Mexico.

The Company had operating losses in both the three month period ended August 31, 2016 and the comparable period of the previous year.  The current loss is significantly higher than in the previous year, the result of the higher administrative expenses.


Interest expense in the current three month period was $240, compared with $9,264 in the comparable period of 2015.  Interest expense accrues on outstanding debt obligations and on credit card charges.  Debt obligations were higher in the 2015 period.   


Net loss in the 2016 three month period was $127,505, compared with a net loss of $68,476 in the comparable period of 2015.  The unfavorable change is due to the higher administrative costs.


Since the acquisition of PGPI, our operations have focused on developing, planning and operating past producing precious metal properties and mines. Specifically, we are now a gold and silver exploration and extraction company, operating primarily in Baja California, Mexico, and Nevada.  We will focus on acquiring gold and base mineral resource properties that historically produced gold and silver until 1942 when all gold production in the United States was halted due to World War II. There is no guarantee that such properties will produce gold or silver in the future or that these properties may have already been depleted, as they were previously mined.



8






None of our properties or claims has proven or probable reserves and all of our activities undertaken and currently proposed are exploratory in nature, with the exception of production from our Mexican mining claims.


As of August 31, 2016, the Company had a working capital deficit of $163,639, compared with a working capital deficit of $94,145 as of May 31, 2016. The significant change is principally due to a reduction in our cash balance and an increase in accounts payable.


The Company has projected that its administrative overhead for the next 12 months will be approximately $185,000 which consists of accounting fees (including tax, audit and review) in the approximate amount of $45,000, legal fees in the approximate amount of $40,000, and miscellaneous expenses of $100,000. The projected legal and accounting fees relate to the Company’s reporting requirements under the Securities Exchange Act of 1934. The Company expects to incur additional legal and accounting fees in order to effect acquisitions and share exchanges or a business combination transaction. The Company has no other capital commitments. To continue its business plan, the Company will be required to raise additional funds through the private placement of its capital stock or through debt financing to meet its ongoing corporate overhead obligations. If the Company is unable to meet its corporate overhead obligations, it will have a material adverse impact on the Company and the Company may not be able to complete its plan of operations of expanding its mining operations in Mexico and finding a suitable business acquisition or combination candidate.


Please refer to the Company’s Form 10-K for the period ending May 31, 2016 for a discussion of other risks attendant to its proposed plan of operations of effecting a business acquisition or combination, including the occurrence of significant dilution and a change of control. Even if successful in effecting a business acquisition or combination, it is likely that numerous risks will exist with respect to the new entity and its business.


Off-Balance Sheet Arrangements


We do not have any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues and results of operations, liquidity or capital expenditures


Significant Accounting Policies


a.    Cash


For purposes of the Statement of Cash Flows, the Company considers all short-term debt securities purchased with a maturity of three months or less to be cash equivalents.


b.    Fair Value of Financial Instruments


The carrying amounts of the Company’s financial instruments, which include cash equivalents, and accrued liabilities, approximate their fair values at August 31, 2016.


c.    Loss (Income) Per Share


Basic earnings (loss) per share is computed by dividing the net income (loss) available to common shareholders for the period by the weighted average number of shares outstanding. During periods when a net loss has occurred, as was the case in the three month period ended August 31, 2016, outstanding options and warrants are excluded from the calculation of diluted loss per share as their inclusion would be anti-dilutive.



9






d.    Income Taxes


The Company accounts for income taxes in accordance with current accounting guidance, which requires the use of the “liability method”.  Accordingly, deferred tax liabilities and assets are determined based on differences between the financial statement and tax bases of assets and liabilities, and consideration of net operating loss carry forwards, using enacted tax rates in effect for the year in which the differences are expected to reverse.  Current income taxes are based on the income that is currently taxable.


e.    Marketable Securities


Marketable securities, when owned, are classified as available-for-sale and are carried at fair value.  Unrealized gains and losses on these securities are recognized as direct increases or decreases in accumulated other comprehensive income.


f.    Fixed Assets


Fixed assets are recorded at cost.  Depreciation is computed by using accelerated methods, with useful lives of seven years for furniture and equipment and five years for computers and automobiles.


g.    Use of Estimates


The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.


h.    Advertising Costs


The Company expenses advertising costs when the advertisement occurs. There was no advertising expense in the three month period ended August 31, 2016.


i.    Segment Reporting


The Company is organized in one reporting and accountable segment.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.


Not Applicable . Smaller Reporting Companies are not required to provide the information required by this item.

Item 4. Controls and Procedures.


Under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer (one and the same person), we undertook an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Securities Exchange Act of 1934, Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this report. Based on this evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that such disclosure controls and procedures were not effective to ensure (a) that information required to be disclosed by us in reports that we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and (b) that information required to be disclosed is accumulated and communicated to management to allow timely decisions regarding disclosure.




10





There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) during the quarter ended August 31, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


PART II – OTHER INFORMATION

Item 1. Legal Proceedings.


None

Item 1A. Risk Factors.  


Smaller Reporting Companies are not required to provide the information required by this item.

Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.


There were no shares of Company common stock purchased or sold during the three month period ended August 31, 2016.  There were 1,750,000 shares of common stock issued as compensation.


Each officer and director is an accredited investor and agreed to hold such shares for investment purposes.  In addition, the issued shares contained restricted legends.  All of the securities issuances referred to above were exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended (the “Act”) or the rules and regulations promulgated there under, including Regulation D and Rule 701.

Item 3. Defaults Upon Senior Securities.


None

Item 4. Mine Safety Disclosures.


None

Item 5. Other Information.


See note 10 to the financial statements.

Item 6. Exhibits


(a) Exhibits Furnished.


Exhibit #31.1 – Certification Pursuant To Section 302 of the Sarbanes-Oxley Act of 2002.

Exhibit #31.2 – Certification Pursuant To Section 302 of the Sarbanes-Oxley Act of 2002.

Exhibit #32    – Certification Pursuant To Section 906 of the Sarbanes-Oxley Act of 2002.


The following exhibits contain information from our Quarterly Report on Form 10-Q for the quarter ended August 31, 2016 formatted in Extensible Business Reporting Language (XBRL):


Exhibit #101.INS – XBRL Instance Document

Exhibit #101.SCH – XBRL Taxonomy Schema Document

Exhibit #101.CAL – XBRL Taxonomy Calculation Linkbase Document

Exhibit #101.DEF – XBRL Taxonomy Extension Definition Linkbase

Exhibit #101.LAB – XBRL Taxonomy Label Linkbase Document

Exhibit #101.PRE – XBRL Taxonomy Presentation Linkbase Document



11






SIGNATURES

  

In accordance with the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

  

AMERICAN INTERNATIONAL VENTURES, INC.

(Registrant)


By:    /s/ Jose Garcia

       ___________________________________

         Jose Garcia

         Chief Executive Officer

        (Principal Executive Officer)


By:  /s/ Jack Wagenti

       ___________________________________

       Jack Wagenti

       Chairman and Chief Financial Officer

       (Principal Financial Officer)


Date:   October 20, 2016






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