UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10QSB
(Mark One)
[X] Quarterly Report Under Section 13 or 15 (d) of the Securities Exchange Act
of 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2003
[ ] Transition Report Under Section 13 or 15 (d) of the Exchange Act
For the transition period from _________________ to __________________
Commission File Number: 000-28481
ANGLOTAJIK MINERALS, INC.
_________________________________________________________________
(Exact name of small business issuer as specified in its charter)
Nevada 86-0891931
_________________________________ ___________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11400 West Olympic Boulevard, Suite 200, Los Angeles, CA 90064
______________________________________________________________
(Address of Principal Executive Offices)
(310) 445-8819
___________________________
(Issuer's telephone number)
Iconet, Inc.
13636 Ventura Blvd., #252, Sherman Oaks, CA 91432
____________________________________________________
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed be Section
13 or 15 (d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be file
by Section 12, 13, or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by the court. Yes [ ] No [ ]
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.
ISSUED AND OUTSTANDING AS OF SEPTEMBER 30, 2003: 18,118,965 SHARES COMMON STOCK,
$0.001 PAR VALUE
Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]
INDEX
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ANGLOTAJIK MINERALS, INC.
(An Exploration Stage Company)
Balance Sheet as of September 30, 2003 (Unaudited)
September 30, 2003
__________________
(Unaudited)
ASSETS
SHAREHOLDER RECEIVABLE $ 51,227
___________
Total current assets 51,227
___________
DEFERRED TAX ASSET (NET) -
___________
Total other assets -
___________
Total assets $ 51,227
===========
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Accounts payable $ 355,644
Bank overdraft payable 28,375
Related party payable 450,465
Interest payable to a related party 2,141
Accrued expenses 3,081
Payroll and payroll taxes payable 152,385
___________
Total current and total liabilities 992,091
___________
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIT
Common stock, $.001 par value, 300,000,000 shares
authorized, 18,118,965 shares issued and outstanding 18,119
Additional paid-in capital 3,752,063
Executive Stock options outstanding 503,497
Deferred compensation cost (487,763)
Deficit accumulated during the development stage (4,726,780)
___________
Total stockholders' deficit (940,864)
___________
Total liabilities and stockholders' deficit $ 51,227
===========
See Notes to the Interim Financial Statements
ANGLOTAJIK MINERALS, INC.
(An Exploration Stage Company)
Statements of Operations for the Nine Months Ended September 30, 2003 and 2002 (Unaudited)
Cumulative From
Inception
(August 1997) Nine Months Nine Months
through Ended Ended
September 30, September 30, September 30,
2003 2003 2002
_______________ _____________ _____________
REVENUE
ADMINISTRATIVE AND GENERAL COSTS
Consulting $(2,501,566) $ (409,999) $ (270,418)
Salaries and wages (312,980) (167,720) -
Research and development (179,027) - -
Marketing (159,394) - -
Exploration (15,000) (15,000) -
Deferred compensation (295,734) (295,734) (60,000)
Legal and accounting (424,134) (22,000) (28,452)
Operating and administrative (609,649) (24,392) (29,228)
Rent (79,335) (2,500) (7,300)
Depreciation (5,562) - -
Amortization (16,500) - -
___________ __________ __________
Total operating costs and expenses (4,598,881) (937,345) (395,398)
___________ __________ __________
NON-OPERATING INCOME
Dividend income 1,212 - -
Gain on cancellation of contracts 74,104 - -
Gain on cancellation of amortization 16,500 - -
Loss on disposal of assets (59,641) - -
___________ __________ __________
Total non-operating income 32,175 - -
___________ __________ __________
INTEREST EXPENSE (160,074) (2,202) (6,886)
___________ __________ __________
Net loss before income taxes (4,726,780) (939,547) (402,284)
___________ __________ __________
Provision for income taxes - - -
___________ __________ __________
Net loss $(4,726,780) $ (939,547) $ (402,284)
=========== ========== ==========
Loss per common share - basic $ (7.11) $ (0.21) $ (0.88)
=========== ========== ==========
Weighted average common shares -basic 664,764 4,492,637 459,695
=========== ========== ==========
Loss per common share - diluted $ (3.81) $ (0.19) $ (0.85)
=========== ========== ==========
Weighted average common shares - diluted 1,239,964 5,067,836 470,641
=========== ========== ==========
See Notes to the Interim Financial Statements
ANGLOTAJIK MINERALS, INC.
(An Exploration Stage Company)
Statements of Cash Flows for the Nine Months Ended September 30, 2003 and 2002 (Unaudited)
Cumulative From Nine Months Nine Months
Inception (August Ended Ended
1997) through September 30, September 30,
September 30, 2003 2003 2002
__________________ _____________ _____________
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (4,726,780) $ (939,547) $ (402,284)
Adjustments to reconcile net loss to net
cash used in operating activities:
Amortization and depreciation expense 22,062 - -
Deferred compensation expense 415,734 295,734 60,000
Gain on cancellation of amortization (16,500) - -
Loss on disposal of assets 59,641 - -
Cancellation of mining rights 15,000 15,000
Decrease in deposits 14,925 - -
Decrease in prepaid consulting 796,250 352,000 -
Increase (decrease) in accounts payable 419,619 - (8,035)
Increase (decrease) in related party payable 553,565 37,500 (1,099)
Interest incurred on bank overdraft 2,202 2,202 7,738
Increase in payroll and payroll taxes payable 152,385 67,720 -
Increase in interest payable 158,197 - 6,814
Increase in accrued expenses 24,580 2,634 35,684
Expenses paid by issuance of
common stock 800,378 100,000 134,583
____________ __________ ___________
Net cash used in operating activities (1,308,742) (66,757) (166,599)
____________ __________ ___________
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of mining rights (15,000) - (15,000)
Deposit paid (14,925) - -
Purchase of fixed assets (65,203) - -
____________ __________ ___________
Net cash used in investing activities (95,128) - (15,000)
____________ __________ ___________
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds received from issuance of stock 454,635 - 250,000
Proceeds received from officer advances 86,147 62,073 19,900
Proceeds from bank overdraft 30,552 32 -
Proceeds received from line of credit 963,849 - 93,350
Payment made on bank overdraft (9,915) (453) -
Payment of officer advances (5,474) - (5,000)
Payment made on line of credit (115,924) - (115,924)
____________ __________ ___________
Net cash provided by financing activities 1,403,870 61,652 242,326
Net increase (decrease) in cash - (5,105) 60,727
Cash and cash equivalents at inception,
December 31, 2002, and 2001 - 5,105 1,068
____________ __________ ___________
Cash and cash equivalents at
September 30, 2003, and 2002 $ - $ - $ 61,795
============ ========== ===========
SUPPLEMENTARY INFORMATION
During the nine months ended September 30, 2003, and September 30, 2002, no amounts were paid for either
interest or income taxes.
In August 2003 the company issued 16,999,984 common shares to shareholders in exchange for interest payable
of $150,519.
In July 2003 the Company issued 286,713 common shares to the President to relieve an advance of $48,773
and set up a receivable of $51,227.
Also in July 2003 a $100,000 signing bonus was paid via the issuance of 279,720 common shares.
In May 2003 the Company issued 2,797 common shares in exchange for consulting expenses of $13,500.
Also in May 2003 the Company issued 13,986 common shares to the President pursuant to a stock option
agreement, to relieve $100,000 in officer advances and consulting fees payable.
In April 2003 the mining rights contract and the related shares were cancelled.
In June 2002 the Company issued 20,797 shares of its common stock for consulting services of $75,000.
See Notes to the Interim Financial Statements
ANGLOTAJIK MINERALS, INC.
(A Company in the Development Stage)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
September 30, 2003
1. BASIS OF PRESENTATION
During the quarter ended September 30, 2003, the Company changed its
name from Iconet, Inc. to Anglotajik Minerals, Inc.
The accompanying unaudited interim financial statements of Anglotajik
Minerals, Inc. (the "Company") have been prepared by the Company in
accordance with accounting principles generally accepted in the United
States of America, pursuant to the Securities and Exchange Commission
rules and regulations. In management's opinion all adjustments
necessary for a fair presentation of the results for the interim
periods have been reflected in the interim financial statements. The
results of operations for any interim period are not necessarily
indicative of the results for a full year. All adjustments to the
financial statements are of a normal recurring nature.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. Such disclosures
are those that would substantially duplicate information contained in
the most recent audited financial statements of the Company, such as
significant accounting policies and stock options. Management presumes
that users of the interim statements have read or have access to the
audited financial statements and notes thereto included in the
Company's most recent annual report on Form 10-KSB.
GOING CONCERN
These financial statements have been prepared assuming that the Company
will continue as a going concern. The Company is currently in the
development stage, and existing cash, other material assets, and
available credit are insufficient to fund the Company's cash flow needs
for the next year. Management is attempting to raise additional
capital, and the President of the Company intends to advance funds as
necessary to fund the cash flow needs of the Company.
2. RECENT ACCOUNTING PRONOUNCEMENTS
In April 2003 the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 149 (SFAS 149)
"Amendment of Statement 133 on Derivative Instruments and Hedging
Activities." SFAS 149, which amends and clarifies existing accounting
pronouncements, addresses financial accounting and reporting for
derivative or other hybrid instruments. This Statement requires that
contracts with comparable characteristics be accounted for similarly.
This Statement is effective for contracts entered into or modified
after September 30, 2003. The Company does not expect the adoption of
SFAS 149 to have any impact on the financial statements.
In May 2003 the FASB issued SFAS No. 150, "Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and
Equity," which is effective at the beginning of the first interim
period beginning after March 15, 2003. SFAS No. 150 establishes
standards for the Company's classification of liabilities in the
financial statements that have characteristics of both liabilities and
equity. The Company believes the adoption of SFAS No. 150 will have no
effect on the Company's financial position or results of operations.
3. RELATED PARTY TRANSACTIONS
The company rented office space on a month-to-month basis from an
officer in order to perform administrative functions. For the nine
months ended September 30, 2003, rent of $2,500 was expensed.
During the nine months ended September 30, 2003, the company incurred
expense for consulting by officers and shareholders. The total expense
for the nine months ended September 30, 2003, was $37,500. The total
related party payable as of September 30, 2003, was $450,465.
An officer of Anglotajik Minerals, Inc. advanced the Company funds to
pay expenses. During the nine months ended September 30, 2003, travel
and other office expenses of $13,300 were paid by an officer. In May
2003 the Company issued 13,986 shares of its common stock to the
officer pursuant to a stock option dated September 1, 2001. This
issuance relieved officer advances payable and consulting fees payable
by $31,900 and $68,100, respectively.
The President of Anglotajik Minerals, Inc. advanced the Company funds
to pay expenses. During the nine months ended September 30, 2003, the
President paid expenses of $48,773. In July 2003 the Board of Directors
authorized the issuance of 286,713 restricted common shares to the
President to relieve the shareholder advance of $48,773 and for a
receivable of $51,227 from the President. During the third quarter of
2003, the President was the only member of the Board of Directors.
In July 2003 the Company issued an option to purchase 699,301 shares of
common stock at $0.21 per share to a Director of the Company (see Note
5). Also in July 2003 a signing bonus of $100,000 was paid to the
President via the issuance of 279,720 shares of restricted common
stock. Wages payable to the President of $60,000 were accrued during
the quarter.
Also during the nine months ended September 30, 2003, the Company
issued a total of 16,999,984 common shares to each the shareholders to
whom interest was due on the old line of credit. The issuance of these
shares relieved the entire outstanding payable of $150,519.
4. CAPITAL STOCK
In January 2003 the company issued 7,692 shares of its common stock to
relieve the common stock subscribed.
In April 2003 the Company and Sea Emerald Development Corp. rescinded
their agreement for the purchase and sale of the mining claims situated
in Porcupine Mining Division, Canada. The restricted Common Stock
issued to Sea Emerald was cancelled.
In May 2003 the Company issued 2,797 shares of common stock to a
shareholder in exchange for accrued consulting services of $13,500.
Also in May 2003 the Company issued 13,986 shares of its common stock
to an officer pursuant to a stock option dated September 1, 2001. This
issuance relieved $100,000 payable to the officer.
In July 2003 the Board of Directors authorized the issuance of 286,713
restricted common shares to the President in exchange for a shareholder
advance of $48,773 and a receivable from the President of $51,227. The
President is the only member of the Board of Directors. Also in July
2003 a signing bonus of $100,000 was paid to the President via the
issuance of 279,720 shares of restricted common stock.
In July 2003 a reverse stock split of 1:143 was authorized by the Board
of Directors, and the number of authorized shares was increased to 300
million.
In August 2003 the Company issued 16,999,984 common shares to the
shareholders to whom interest was due on the line of credit. The
issuance of these shares relieved the entire outstanding payable of
$150,519.
In September 2003 a 2:1 forward stock split was authorized by the Board
of Directors.
5. STOCK OPTIONS
The Company uses the intrinsic value method to account for options
granted to employees for the purchase of common stock. Deferred
compensation is recorded when the market price exceeds the option price
at the grant date. Compensation is recorded using the straight-line
method over the vesting period.
In September 2001 the Company issued an option to purchase 699,301
shares of common stock at $0.21 per share to a Director of the Company
(see Note 3). The Company accrued $503,497 in deferred compensation
costs, as the option price at the grant date was less than the market
price. The option expires in July 2011. The compensation cost will be
accrued over the vesting period. Compensation cost of $15,734 was
included in the statements of operation for the nine months ended
September 30, 2003. The Company has determined the pro-forma
information as if the Company had accounted for the stock option
granted on July 1, 2003, under the fair value method of SFAS 123. The
Black Scholes option-pricing model was used with a risk free interest
rate of 4.67%; dividend yield of 0.0%; a volatility factor of 100% and
an expected life of 8 years. The fair value of the stock options
granted in July 2003 is $0.78 per share. If the Company had recognized
deferred compensation cost based on the fair value method, it would
have decreased deferred compensation by $101,931. It would also have
decreased the compensation cost for the quarter by $3,185.
6. COMMITMENTS AND CONTINGENCIES
There are various claims and lawsuits pending against the Company
arising in the normal course of the Company's business. Although the
amount of liability at September 30, 2003, cannot be ascertained,
management is of the opinion that any resulting liability will not
materially affect the Company's financial position.
Merrill Lynch Canada Inc., has filed suit against the Company regarding
a dispute related to the sale of its restricted common stock by an
unrelated third party to Merrill Lynch. At this time the Company does
not know if it will sustain a loss, or the amount of the loss.
The Company settled an action by a bank regarding an overdraft. The
settlement carried an interest rate of 9.0% and twelve monthly payments
of $3,321. The amount due as of September 30, 2003 is $28,343, which
has been accrued by the Company. The related interest expense of $2,141
has also been accrued by the Company. The Company paid three payments
in the prior year and then defaulted on this settlement.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
NOTE: The following discussion and analysis should be read in conjunction with
the Company's Interim Financial Statements (unaudited) and the Notes to the
Financial Statements for the nine month period ended September 30, 2003.
UNCERTAINTY AS TO CERTAIN ACCOUNTS PAYABLE
We have reviewed, and continue to review our corporate files, books and records,
but remain unable to conclusively identify a basis or certain amount of our
Accounts Payable and for the Related Parties Payable to previous management
carried on our books. We are continuing to attempt to locate invoices or other
documentation regarding those payables.
NINE MONTHS ENDED SEPTEMBER 30, 2003 VERSUS 2002
Operating expenses for the period increased to $937,345 in 2003 compared to
$395,398 for 2002. The principal differences were in consulting fees ($409,999
vs. $270,418) and in deferred compensation payable to officers ($295,734 vs.
$60,000). The increase is attributable primarily to increased activity in
connection with our attempt in the current period to develop the video jukebox
business and our abandoned mineral exploration venture with Sea Emerald
Development Corp. As the company had no cash resources, expenses were funded by
issuance of common stock, by loans subsequently settled by the issuance of our
common stock, and by an increase in the Related Party Payable account.
PLAN OF OPERATION
We currently have no cash or sources of cash to fund operations. We are
attempting to arrange an equity financing in the amount of $1,000,000 to
$2,000,000 to fund our proposed activities in mineral exploration in the
Republic of Tajikistan, although we have received no commitments as yet. Our
ability to continue in the mineral exploration business will depend upon our
success in raising capital through stock sales or some other means, of which we
cannot be certain.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
There are various claims and lawsuits pending against the Company arising in the
normal course of the Company's business. Although the amount of liability at
September 30, 2003, cannot be ascertained, management is of the opinion that any
resulting liability will not materially affect the Company's financial position.
See Note 6 to the Interim Financial Statements.
ITEM 2 - CHANGES IN SECURITIES
The following securities were sold by officers of the Company without the
use of an underwriter. In effecting the sales, we relied on the exemption
authority provided by Section 4(2) of the Securities Act of 1933, as amended,
relating to sales not involving any public offering, and on Regulation D. We
believe that all such sales were made by our executive officers in private,
negotiated transactions without any advertising, public announcements or general
solicitation. The purchasers of the shares represented themselves in writing to
be, and the company believes them to be, members of one or more of the following
classes:
a. Officers, directors, promoters or control persons of the issuer; or
b. Individuals or entities who are accredited investors as defined in
Rule 501 of Regulation D under the Securities Act of 1933; or
c. Individuals who:
i. Are knowledgeable and sophisticated in investment matters;
ii. Are able to assess the risks of an investment such as in our
securities;
iii. Are financially able to bear the risk of a loss of their entire
investment; and
iv. Have access to pertinent information regarding the issuer and its
operations.
The shares are subject to the resale provisions of Rule 144 and may not be sold
or transferred without registration except in accordance with Rule 144.
Certificates representing the securities bear a legend to that effect. The share
amounts in the chart are adjusted for a 143-for-1 reverse split effective July
30, 2003 and a 2-for-1 forward split effective September 15, 2003.
===============================================================================================
Date Class Amount Price($) # of Purchasers
_______________________________________________________________________________________________
May 2003 $.001 par value common stock 16,783 (1) 1
_______________________________________________________________________________________________
June 2003 $.001 par value common stock 20,797 (2) 1
_______________________________________________________________________________________________
July 20, 2003 $.001 par value common stock 566,434 (3) 1
_______________________________________________________________________________________________
August 1, 2003 $.001 par value common stock 16,999,984 (4) 19
===============================================================================================
(1) Valued at $113, 500, or an average price of $.148 per share. Issued to the former president
of the Company as settlement for consulting fees and expenses.
(2) Valued at $75,000, or an average price of $.277 per share. Issued to the former president
of the Company as settlement for consulting fees.
(3) Issued to the current president of the Company as settlement for amounts owed him. See
Note 3 to the Financial Statements.
(4) Valued at $150,519, or approximately $.009 per share. Issued to 19 individuals in settlement
of principle and interest on cash loans to the Company
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The following action was taken by written consent in lieu of a meeting
of shareholders:
==========================================================================================
Proposal In favor Opposed Abstain Result
__________________________________________________________________________________________
Approval of 143-for-1 reverse stock split 566,434 0 552,548 Carried
==========================================================================================
ITEM 5 - OTHER INFORMATION
None.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
We filed the following Current Reports on Form 8-K during the period:
8-K April 8, 2003
8-K October 23, 2003 (Subsequent)
8-K October 24, 2003 (Subsequent)
31.1 Certification of Chief Financial Officer.
31.2 Certification of Chief Executive Officer.
32.1 Section 906 Certification.
32.2 Section 906 Certification.
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Date: November 17, 2003 ANGLOTAJIK MINERALS INC.
/s/ MATTHEW MARKIN
_________________________________________
Matthew Markin
President, Acting Chief Financial Officer