10-Q 1 f10q1209_firstquantum.htm QUARTERLY REPORT f10q1209_firstquantum.htm


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

Form 10-Q


(Mark one)

x  Quarterly  Report Under Section 13 or 15(d) of The Securities  Exchange Act of 1934

For the quarterly period ended December 31, 2009
 
o  Transition Report Under Section 13 or 15(d) of The Securities  Exchange Act of 1934

For the transition period from ______________ to _____________

 
Commission file number 000-52759

 
FIRST QUANTUM VENTURES, INC.

(Exact name of registrant as specified in its charter)
 
 
Nevada
 
20-4743354
(State or other jurisdiction of incorporation)
  (IRS Employer Identification No.)
 
 
2101 Vista Parkway, Suite 292
West Palm Beach FL33411 

(Address of principal executive offices)(Zip Code)


Registrant's telephone number, including area code: (561) 228-6148


N/A

(Former name or former address, if changes since last report)




Indicate by check mark whether the issuer (1) has filed all reports  required to be filed by Section 13 or 15(d) of the Securities Exchange Act 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 o

Indicate by check mark whether the registrant is an accelerated filer, a non-accelerated filer, or a smaller reporting company.
 
 
Large accelerated filer             o
Non-accelerated filer               o
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).  Yes x  No o
 
APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:

As of February 1, 2010,  there were  approximately 340,632  shares of the Issuer's common stock, par value $0.001 per share outstanding.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this quarterly report on Form 10-Q contain or may contain forward-looking  statements that are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  These forward-looking statements were based on various factors and were derived utilizing  numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to,  economic, political and market conditions and fluctuations, government and industry regulation,  interest rate risk, U.S. and global competition, and other factors including the risk factors set forth in our Form 10-K. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. Readers are cautioned not to place  undue reliance on these forward-looking statements, which speak only as of the date of this  report. Readers should carefully review this quarterly report in its entirety, including but not limited to our financial statements and the notes thereto. Except for our ongoing  obligations to  disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated  events. For any forward-looking statements contained in any document, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

 

 
 
INDEX
 
PART I. - FINANCIAL INFORMATION

Item 1.
Financial Statements

Item 2
Management's Discussion and Analysis or Plan of Operations
Item 3
Quantitative and Qualitative Disclosures About Market Risk

Item 4T.
Controls and Procedures
PART II. - OTHER INFORMATION
Item 1
Legal Proceedings
Item 1A.
Risk Factors

Item 2
Unregistered Sales of Equity Securities and Use of Proceeds
Item 3
Defaults Upon Senior Securities
Item 4
Submission of Matters to a Vote of Security Holders

Item 5
Other Information
Item 6
Exhibits
SIGNATURES

EXHIBITS




 
PART I. - FINANCIAL INFORMATION

Item 1. Financial Statements



INDEX TO FINANCIAL STATEMENTS


Balance Sheet
F-2
   
Statements of Operations
F-3
   
Statements of Stockholders' Equity
F-4
   
Statements of Cash Flows
F-5
   
Notes to Financial Statement
F-6
   
 
 



F-1






First QuantumVentures, Inc.
(an development stage enterprise)
Balance Sheet


   
December 31, 2009
   
June 30, 2009
 
   
(Unaudited)
       
ASSETS
CURRENT ASSETS
           
   Cash
  $ 95     $ 0  
   Prepaid expenses
    0       0  
                 
          Total current assets
    95       0  
                 
OTHER ASSETS
               
   Other assets
    0       0  
                 
          Total other assets
    0       0  
                 
Total Assets
  $ 95     $ 0  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
               
    Accounts payable and accrued  liabilities
  $ 0     $ 0  
    Accrued interest on line of credit payable
    13,730       10,071  
                 
          Total current liabilities
    13,730       10,071  
                 
LONG-TERM LIABILITIES
               
                 
    Long-term line of credit payable
    77,156       57,156  
                 
          Total long-term liabilities
    77,156       57,156  
                 
Total Liabilities
    90,886       67,227  
                 
                 
STOCKHOLDERS' EQUITY
               
  Common stock, $0.001 par value, authorized 500,000,000 shares; 340,632 issued and outstanding
    340       340  
  Additional paid-in capital
    33,690       33,690  
  Deficit accumulated during the development stage
    (124,821 )     (101,257 )
                 
          Total stockholders' equity
    (90,791 )     (67,227 )
                 
Total Liabilities and  Stockholders' Equity
  $ 95     $ 0  

 
The accompanying notes are an integral part of the financial statements
F-2



 
First Quantum Ventures, Inc.
(an development stage enterprise)
Statements of Operations
Three And Six Months Ended December 31,
(Unaudited)

   
 
 
Three Months
   
 
 
Six Months
   
Period from
Feb 24, 2004
(Inception)
through
 
   
2009
   
2008
   
2009
   
2008
   
Dec 31, 2009
 
                               
                               
REVENUES
  $ 0     $ 0     $ 0     $ 0     $ 0  
                                         
OPERATING EXPENSES
                                       
   General and administrative
    3,175       3,044       5,655       4,667       87,716  
   Professional fees
    4,750       0       14,250       0       23,375  
   Interest expense
    1,944       1,177       3,659       2,251       13,730  
                                         
          Total expenses
    9,869       4,221       23,564       6,918       124,821  
                                         
                                         
Net loss
  $ (9,869 )   $ (4,221 )   $ (23,564 )   $ (6,918 )   $ (124,821 )
                                         
Basic net loss per weighted average share
  $ ( 0.03 )   $ ( 0.01 )   $ ( 0.07 )   $ ( 0.02 )        
                                         
Weighted average number of shares
    340,632       340,632       340,632       340,632          

 
The accompanying notes are an integral part of the financial statements
F-3


 


First Quantum Ventures, Inc.
(an development stage enterprise)
 Statement of Stockholders' Equity (Deficit)


   
 
 
 
 
 
Number of
Shares
   
 
 
 
 
 
Common
Stock
   
 
 
 
 
Additional
Paid-in Capital
   
 
 
Deficit
Accumulated
During the
Development
Stage
   
 
 
 
 
Total
Stockholders'
Equity
 
                               
BEGINNING BALANCE, July 1, 2005
    34,030,390     $ 34,030     $ 0     $ (34,030 )   $ 0  
                                         
Net loss
    0       0       0       (8,582 )     (8,582 )
                                         
BALANCE, June 30, 2006
    34,030,390       34,030       0       (42,612 )     (8,582 )

Net loss
    0       0       0       (8,205 )     (8,205 )
                                         
BALANCE, June 30, 2007
    34,030,390       34,030       0       (50,817 )     (16,787 )
1 for 100 reverse split
    (33,690,086 )     (33,690 )     33,690       0       0  
Net loss
    0       0       0       (24,549 )     (24,549 )
                                         
BALANCE, June 30, 2008
    340,304       340       33,690       (75,366 )     (41,336 )
Net loss
    0       0       0       (25,891 )     (25,891 )
BALANCE, June 30, 2009
    340,304       340       33,690       (101,257 )     (67,227 )
Net loss
    0       0       0       (23,564 )     (23,564 )
BALANCE, December 31, 2009 (unaudited)
    340,304     $ 340     $ 33,690     $ (124,821 )   $ (90,791 )
 
 
The accompanying notes are an integral part of the financial statements
F-4


 

First Quantum Ventures, Inc.
(an development stage enterprise)
Statements of Cash Flows
Six Months Ended December 31,
(Unaudited)

   
 
 
 
2009
   
 
 
 
2008
   
Cumulative from
February 24, 2004
(inception) to
Dec 31, 2009
 
CASH FLOWS FROM OPERATING ACTIVITIES:
                 
Net loss
  $ (23,565 )   $ (6,918 )   $ (124,821 )
Adjustments to reconcile net loss to net cash used by operating activities:
                       
        Common stock issued for services
    0       0       25,000  
Changes in operating assets and liabilities
                       
        Increase (decrease) in accounts payable - trade
    0       4,667       0  
        Increase (decrease) in accrued interest
    3,659       2,251       13,730  
                         
Net cash provided (used) by operating activities
    (19,906 )     0       (86,091 )
                         
CASH FLOWS FROM INVESTING ACTIVITIES:
                       
 Deposit on options
    0       0       0  
                         
Net cash provided (used) by investing activities
    0       0       0  
                         
CASH FLOWS FROM FINANCING ACTIVITIES:
                       
Common stock issued for cash
    0       0       9,030  
Proceeds from line of credit payable
    20,000       6,918       77,156  
Payments on line of credit payable
    0       0       0  
                         
Net cash provided by financing activities
    20,000       6,918       86,186  
                         
Net increase (decrease) in cash
    94       6,918       95  
                         
CASH, beginning of period
    0       0       0  
                         
CASH, end of period
  $ 94     $ 6,918     $ 95  
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
                       
Non-Cash Financing Activities:
                       
  None
                       


The accompanying notes are an integral part of the financial statements
F-5


 
First Quantum Ventures, Inc.
(an development stage enterprise)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)

Note 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 
(a) The Company First Quantum Ventures, Inc.. is a Nevada chartered development stage corporation which conducts business from its headquarters in West Palm Beach, Florida.

The following summarize the more significant accounting and reporting policies and practices of the Company:

 
(b) Use of estimates  The financial statements have been prepared in conformity with generally accepted accounting principles.  In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the statements of financial condition and revenues and expenses for the year then ended.  Actual results may differ significantly from those estimates.

 
(c) Start-up costs  Costs of start-up activities, including organization costs, are expensed as incurred, in accordance with Statement of Position (SOP) 98-5.

(d) Stock compensation for services rendered The Company may issue shares of common stock in exchange for services rendered.  The costs of the services are valued according to generally accepted accounting principles and have been charged to operations.

 
(e) Net income (loss) per share Basic loss per share is computed by dividing the net income (loss) by the weighted average number of common shares outstanding during the period.
 
(f) Property and equipment All property and equipment are recorded at cost and depreciated over their estimated useful lives, using the straight-line method.  Upon sale or retirement, the cost and related accumulated depreciation are eliminated from their respective accounts, and the resulting gain or loss is  included in the results of operations.  Repairs and maintenance charges, which do not increase the useful lives of the assets, are charged to operations as incurred.

(g) Cash and equivalents For purposes of the statement of cash flows, the Company considers all highly liquid investments with maturity of three months or less when purchased to be cash equivalents

(h)  Interim financial information The financial statements for the three months ended September 30, 2009 and  2008 are unaudited and include all adjustments which in the opinion of management are necessary for fair presentation, and such adjustments are of a normal and recurring nature. The results for the three months are not indicative of a full year results.
 
 
F-6

 
First Quantum Ventures, Inc.
(an development stage enterprise)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)

 
 

NOTE 2 - GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  The Company's financial position and operating results raise substantial doubt about the Company's ability to continue as a going concern, as reflected by the net loss of $124,821 accumulated through December 31, 2009. The ability of the Company to continue as a going concern is dependent upon commencing operations, developing sales and obtaining additional capital and financing.  The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.  The Company is currently seeking additional capital to allow it to begin its planned operations

NOTE 3 - NOTES PAYABLE

The Company has entered into a convertible line of credit payable, which bears a 10% interest rate, a maturity date of December 31, 2011 and is unsecured. The line allows for draws up to $100,000, of which the Company has drawn $77,156. It is convertible at the option of the holder at the lesser of 60% of the 3 day prior closing price, $0.01 or the price shares are sold to a third party.

NOTE 4 - STOCKHOLDERS EQUITY

At December 31, 2009, the Company has 500,000,000 shares of par value $0.001 common stock authorized and 340,632 issued and outstanding.



F-7


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

The following  discussion and analysis  should be read in conjunction with our Financial Statements and Notes thereto appearing elsewhere in this Report on Form 10-Q as well as our other SEC filings.

Overview

First Quantum Ventures, Inc., (FQVI) was originally formed as Cine-Source Entertainment, Inc., (Old Corporation) a Colorado Corporation, on July 29, 1988.  Pursuant to a Plan of Merger dated February 24, 2004, the Old Corporation filed Articles and Certificate of Merger with the Secretary of State of the State of Colorado merging the Old Corporation into Cine-Source Entertainment, Inc., (The Surviving Corporation), a Colorado Corporation.  A previous controlling shareholder group of the Old Corporation arranged the merger for business reasons that did not materialize. On April 26, 2004, the Company effected a 1-for-200 reverse stock split.  Thereafter, the name of the surviving corporation was changed to First Quantum Ventures, Inc., on April 27, 2004.  On April 13, 2006 the Surviving Corporation formed a wholly owned subsidiary, a Nevada Corporation named First Quantum Ventures, Inc., and on May 5, 2006 merged Surviving Corporation into First Quantum Ventures, Inc., the Nevada Corporation.

The  Company is a start-up, developmental stage company and has not yet generated or realized any  revenues from business operations. The Company's auditors have issued a going concern opinion in our audited financial statements for the fiscal year ended June 30, 2009 and 2008. This means that our auditors  believe there is doubt that the Company can continue as an on-going business for the next twelve months unless it obtains additional capital to pay its bills. This is because the Company has not generated any revenues and no revenues are anticipated. Accordingly, we must raise cash from sources such as investments by others in the Company and through  possible transactions with strategic or joint venture partners. In the event we raise cash, we will likely use such funds to develop a new business plan, which is as yet undetermined. We do not plan to use any capital raised for the purchase or sale of any plant or significant equipment. The following discussion and analysis should be read in conjunction with the financial statements of the Company and the  accompanying notes appearing subsequently under the caption "Financial Statements".

Comparison of Operating Results for the Three Months Ended December 31, 2009 to the Three Months Ended December 31, 2008

Revenues
 
The Company did not  generate  any revenues from operations for the three months ended December 31, 2009 or 2008. Accordingly,  comparisons with prior periods are not meaningful.  The Company is subject to risks  inherent in the  establishment  of a new business  enterprise, including limited capital  resources and cost  increases  in services.

Operating Expenses

Operating  expenses increased by $5,648 from $4,221 for the three months ended December 31, 2008 to $9,869 for the three months ended December 31, 2009. The increase in our net operating expenses is due to increased professional fees expenses incurred.

Net Loss

Net loss increased by $5,648 from net loss of $4,221 for the three months ended December 31, 2008 to a net loss of $9,869 for the three months ended December 31, 2009. The increase in net operating loss is due to the increased professional fees expenses incurred.

At December 31, 2009, our accumulated deficit was $124,821.

 

 
 
Assets and Liabilities

Our total assets were  $95 at December 31, 2009.  Our assets consist of cash of $95.

Total Current  Liabilities are $13,730 at December 3, 2009.  Our accrued interest on line of credit payable is $13,730.

Financial Condition, Liquidity and Capital Resources

At December 31, 2009, we had cash and cash equivalents of $95. Our working capital is presently minimal and there can be no assurance that our financial condition will improve. To date, we have not generated cash flow from operations. Consequently, we have been dependent upon third party loans to fund our cash  requirements.

As of December 31, 2009, we had a working capital deficit of $13,635. At December 31, 2009, total liabilities were $90,886. This increase is attributable to borrowing to pay expenses. As of December 31, 2009,  the Company had no outstanding debt other than a long-term line of credit. The Company is seeking to raise capital to implement the Company's business strategy.  In the event additional capital is not raised, the Company may seek a merger, acquisition or outright sale.

No trends have been identified which would materially  increase or decrease our results of operations or liquidity.

Plan of Operation

The Company's plan of operation through June 30, 2010 is to focus on finding a suitable merger candidate or a viable business plan. The Company is seeking to raise capital to implement the Company's business strategy. In the event additional capital is not raised, the Company may seek a merger, acquisition or outright sale.

Comparison of Operating Results for the Six Months Ended December 31, 2009 to the Six Months Ended December 31, 2008

Revenues

The Company did not  generate  any revenues from operations for the six months ended December 31, 2009 or 2008. Accordingly,  comparisons with prior periods are not meaningful.  The Company is subject to risks  inherent in the  establishment  of a new business  enterprise, including limited capital  resources and cost  increases  in services.

Operating Expenses

Operating  expenses increased by $16,646 from $6,918 for the six months ended December 31, 2008 to $23,564 for the six months ended December 31, 2009. The increase in our net operating expenses is due to increased professional fees expenses incurred.
 
 


 
Net Loss

Net loss increased by $16,646 from net loss of $6,918 for the six months ended December 31, 2008 to a net loss of $23,564 for the six months ended December 31, 2009. The increase in net operating loss is due to the increased professional fees expenses incurred.

At December 31, 2009, our accumulated deficit was $124,821.

Assets and Liabilities

Our total assets were  $95 at December 31, 2009.  Our assets consist of cash of $95.

Total Current  Liabilities are $13,730 at December 3, 2009.  Our accrued interest on line of credit payable is $13,730.

Financial Condition, Liquidity and Capital Resources

At December 31, 2009, we had cash and cash equivalents of $95. Our working capital is presently minimal and there can be no assurance that our financial condition will improve. To date, we have not generated cash flow from operations. Consequently, we have been dependent upon third party loans to fund our cash  requirements.

As of December 31, 2009, we had a working capital deficit of $13,635. At December 31, 2009, total liabilities were $90,886. This increase is attributable to borrowing to pay expenses. As of December 31, 2009,  the Company had no outstanding debt other than a long-term line of credit. The Company is seeking to raise capital to implement the Company's business strategy.  In the event additional capital is not raised, the Company may seek a merger, acquisition or outright sale.

No trends have been identified which would materially  increase or decrease our results of operations or liquidity.

Plan of Operation

The Company's plan of operation through June 30, 2010 is to focus on finding a suitable merger candidate or a viable business plan. The Company is seeking to raise capital to implement the Company's business strategy. In the event additional capital is not raised, the Company may seek a merger, acquisition or outright sale.

Critical Accounting Policies

Use of Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates.
 
 

 
 
Loss per share: Basic loss per share excludes dilution and is computed by dividing the loss attributable to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in the earnings of the Company. Diluted loss per share is computed by dividing the loss available to common shareholders by the weighted average number of common shares outstanding for the period and dilutive potential common shares outstanding unless consideration of such dilutive potential common shares would result in anti-dilution. Common stock equivalents were not considered in the calculation of diluted loss per share as their effect would have been anti-dilutive for the periods ended December 30, 2009 and 2008.

Going Concern.

The Company has suffered recurring losses from operations and is in serious need of additional financing. These factors among others indicate that the Company may be unable to continue as a going concern, particularly in the event that it cannot obtain additional financing or, in the alternative, affect a merger or acquisition. The Company's continuation as a going concern depends upon its ability to generate sufficient cash flow to conduct its operations and its ability to obtain additional sources of capital and financing. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern.

Item 3 - Quantitative and Qualitative Disclosures About Market Risk

The Company is not subject to any specific market risk other than that encountered by any other public company related to being publicly traded.
Item 4T - Controls and Procedures

Our management, which includes our Chief Executive Officer who also serves as our principal financial officer, have conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-14(c) promulgated under the Securities and Exchange Act of 1934, as amended) as of a date (the "Evaluation Date") as of the end of the period covered by this report. Based upon that evaluation, our management has concluded that our disclosure controls and procedures are not effective for timely gathering, analyzing and disclosing the information we are required to disclose in our reports filed under the Securities Exchange Act of 1934, as amended, because of adjustments required by our independent auditors, primarily in the area of notes payable. Specifically, our independent auditors identified deficiencies in our internal controls and disclosures related to the valuation and amortization of beneficial conversion features on our notes payable. We have made the necessary adjustments to our financial statements and footnote disclosures in our Interim Report on Form 10-Q. We are in the process of improving our internal controls in an effort to remediate the deficiencies. There have been no significant changes made in our internal controls or in other factors that could significantly affect our internal controls subsequent to the end of the period covered by this report based on such evaluation.




PART II
OTHER INFORMATION
Item 1   Legal Proceedings

None.

Item 2 Unregistered Sales of Equity Securities and Use of Proceeds

None.
Item 3   Defaults Upon Senior Securities

None
Item 4   Submission of Matters to a Vote of Security Holders

None

Item 5   Other Information

None
Item 6   Exhibits

(a) The following  sets forth those  exhibits filed pursuant to Item 601 of Regulation S-K:

Exhibit number
 
Descriptions
     
31.1
 
* Certification of the Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley  Act of 2002.
     
31.2
 
* Certification of the Acting Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002.
 
   
32.1
 
* Certification Chief Executive Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
 
   
32.1
 
* Certification Acting Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
 
               
*    Filed herewith.
 
(b) The following  sets forth the  Company's  reports on Form 8-K that have been filed during the quarter for which this report is filed:

None.







SIGNATURE


Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

  First Quantum Ventures, Inc.  
       
 
By:
/s/ Andrew Godfrey  
    Andrew Godfrey  
   
Chief Executive Officer,
President and Chairman of the Board*
 
       
Date: February 10, 2010


*    Andrew Godfrey has  signed  both on  behalf  of the  registrant  as a duly authorized officer and as the Registrant's principal accounting officer.