UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-KSB
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended May 31, 2007
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ____________ to ____________
Commission file number 000-50101
USA Uranium Corp.
(Name of small business issuer in its charter)
Nevada 91-2135425
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
800-2300 West Sahara Avenue, Las Vegas, NV. 89102
(Address of principal executive offices) (Zip Code)
702-664-0039
(Issuer's telephone number)
E and S Holdings, Inc.
5046 East Boulevard NW,
Canton, Ohio 44718
(Former name or former address, if changed since last report)
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $.001 par value per share
(Title of class)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [X]
Indicated by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
State issuer's revenues of its most recent fiscal year. $652.00
State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days. (See definition of affiliate in Rule
12b-2 of the Exchange Act.) - $21,727,323 as of August 24, 2007.
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. 61,964,236 shares common stock $.001
par value
DOCUMENTS INCORPORATED BY REFERENCE
Form 10-QSB for first, second and third quarter of fiscal year; Form SB-2,
effective November 18, 2002 for exhibits.
Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]
TABLE OF CONTENTS
Number Item in Form 10-KSB Page No.
------ ------------------- --------
1 Description of Business 3
2 Description of Property 11
3 Legal Proceedings 11
4 Submission of Matters to a Vote of Security Holders 11
5 Market for Common Equity and Related Stockholder Matters 11
6 Management's Discussion and Analysis for Plan of Operation 12
7 Financial Statements 14
8 Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 27
8A Controls and Procedures 27
8B Other Information 27
9 Directors, Executive Officers, Promoters and Control Persons 27
10 Executive Compensation 29
11 Security Ownership of Certain Beneficial Owners and Management 29
12 Certain Relationships and Related Transactions 30
13 Exhibits and Reports on Form 8-K 31
14 Principal Accountant Fees and Services 31
Signatures 32
2
FORWARD LOOKING STATEMENTS
The "Company" or "Registrant" is used in this report to refer to USA Uranium
Corp. This 10-KSB may contain "forward-looking statements." These statements may
include, without limitation, statements relating to management's expectations
regarding the Company's ability to remain solvent, capital requirements,
mineralized materials, economic reserves, business strategies and other plans
and objectives of the Company's management for future operations and activities
and other such matters. The words "believes," "plans," "intends," "strategy,"
"projects," "targets," or "anticipates" and similar expressions identify
forward-looking statements. The Company does not undertake to update, revise or
correct any of the forward-looking information. We intend that such
forward-looking statements be subject to the safe harbors for such statements.
We wish to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. Any
forward-looking statements represent management's best judgments as to what may
occur in the future; however, forward-looking statements are subject to risks,
uncertainties and important factors beyond our control that could cause actual
results and events to differ materially from historical results of operations
and events and those presently anticipated or projected. We disclaim any
obligation subsequently to revise any forward-looking statements to reflect
events or circumstances after the date of such statement or to reflect the
occurrence of anticipated or unanticipated events. Certain terms used in this
Form 10-KSB are defined in the "Glossary of Certain Terms" appearing at the end
of Part I hereto.
AVAILABLE INFORMATION
USA Uranium Corp. files annual, quarterly, current reports, proxy statements and
other information with the Securities and Exchange Commission (the
"Commission"). You may read and copy documents referred to in this Annual Report
on Form 10-KSB that have been filed with the Commission at the Commission's
Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. You may obtain
information on the operation of the Public Reference Room by calling the
Commission at 1-800-SEC-0330. You can also obtain copies of our Commission
filings by going to the Commission's website at http://www.sec.gov
PART ONE
ITEM 1 - DESCRIPTION OF BUSINESS
BUSINESS DEVELOPMENT
OUR HISTORY
USA Uranium Corp. was incorporated as E and S Holdings, Inc. on June 20, 2001
under the laws of the State of Nevada. The Company filed an amendment to its
articles of incorporation changing its name to Trilliant, Inc. in December 2006,
and to USA Uranium Corp. in May 2007. The Company has not been involved in any
bankruptcy, receivership or similar proceedings, nor has it been a party to any
merger, consolidation or purchase or sale of a significant amount of assets not
in the ordinary course of business.
USA Uranium is a corporation that is in its developmental stages. From its
inception in June, 2001 until December of 2006 the Company was engaged in the
development, marketing and sales of a locking pliers tool which is being
marketed as the "Portable Pipe Vise". During December 2006, the Company
determined that it wished to change the primary focus of its business operations
to the mineral exploration business with a focus on diamonds. During early 2007,
the Company changed the focus of its business operations to the exploration for
economic reserves of uranium in the United States, concentrating in the State of
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Utah and the "Four Corners" area, where the states of Utah, Arizona, Colorado
and New Mexico intersect.
On December 16, 2005 we commenced trading on the Over-the-Counter Bulletin Board
under the symbol "ESHI". Subsequent to our name change to Trilliant, Inc., our
symbol was changed to "TRLL." Then subsequent to our name change to USA Uranium
Corp. our symbol was changed to "USAU." Please note that throughout this Annual
Report, and unless otherwise noted, the words "we", "our", "us", the "Company",
or "USA Uranium", refer to USA Uranium Corp.
OUR BUSINESS
A) NATURAL RESOURCE EXPLORATION
We are primarily a natural resource exploration and development company engaged
in the exploration and development of properties that may contain uranium
minerals in the United States. Our exploration strategy is to acquire properties
that we believe may contain economic quantities of uranium ore and have
undergone some degree of uranium exploration but have not yet been mined or if
previously mined may still contain economic quantities of uranium. To date, we
have acquired a total of 4,340 gross acres of leased or staked mineral
properties, consisting of claim blocks located in the State of Utah, which we
intend to explore for economic deposits of uranium.
Certain of these claims are subject to royalty interests and required work
programs outlined below. Each of these properties has been the subject of some
historical exploration by other individuals or mining companies. The Company
believes the historical results indicate that further exploration for uranium is
warranted. The Company's belief that our properties are prospective for mineral
exploration is based on either prior exploration conducted by other companies or
management information and work product derived from various reports, maps,
radioactive rock samples, exploratory drill logs, state organization reports,
consultants review, geological study, and/or other exploratory information.
We also have access to various historical exploration data consisting chiefly of
drill hole assay results, drill hole logs, studies, publicly published works,
our own created work product, and maps, that help guide our property acquisition
strategy. We plan to use this exploration data as the basis for formulating the
exploration programs that we plan to undertake on our properties.
Our current mineral properties are the Browns Hole, I-70 and Loa properties,
located in Utah, and consisting of 1,260, 720, and 2,360 acres respectively. We
plan to use our exploration data to target additional exploration properties for
acquisition. Going forward we have plans to acquire additional mineral
properties consisting of claim blocks located in, but not limited to, the four
corners area of the United States which includes the states of Utah, Colorado,
Arizona and New Mexico, with our primary focus in Utah. Our ability to complete
these acquisitions will be subject to our obtaining sufficient financing and our
being able to conclude agreements with the property owners on terms acceptable
to us. These potential property acquisitions have not yet been specifically
identified.
Our properties do not have any proven or probable reserves. We plan to conduct
exploration programs on these properties with the object of ascertaining whether
any or our properties contain economic concentrations of uranium and vanadium
that are prospective for mining. As such, we are considered an exploration or
exploratory stage company. Since we are an exploration stage company, there is
no assurance that a commercially viable mineral deposit exists on any of our
properties, and a great deal of further exploration will be required before a
final evaluation as to the economic and legal feasibility for our future
exploration is determined. We have no known reserves of uranium or any other
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type of mineral. Since inception, we have not established any proven or probable
reserves on our mineral properties.
DESCRIPTION OF OUR MINERAL PROPERTIES
A) BROWNS HOLE PROPERTY
This Property was purchased from Gary Vancil (33.33%), Nugget Shupe (33.33%) and
Bob Shupe (33.33%) on May 23rd, 2007. The property consists of claims 63
totaling approximately 1,260 acres, located in San Juan County, Utah.
The Company purchased the property for an aggregate total of $250,000.00, all as
Advance Royalty Payments, as follows: $15,000 upon signing which was deemed to
be May 23rd, 2007 (the "Effective Date"), $25,000.00 on the Closing Date (date
of BLM recording) and issue to the Vendors 100,000 restricted shares of its
$0.001 par value common stock pursuant to the terms and conditions of Rule 144
as it may apply; $25,000.00 in twelve months after the Closing Date; $35,000.00
in eighteen months after the Closing Date; $50,000.00 in twenty-four months
after the Closing Date; $50,000.00 in thirty months after the Closing Date; and
$50,000.00 in thirty-six months after the Closing Date; The total purchase cost
for 100% interest in the property is cash totaling $250,000, common shares
totaling 100,000 and a Net Smelter Revenue Royalty of 3%. Additionally the
Company shall have the right, exercisable at any time within 20 years from the
Effective Date, to reduce the Net Smelter Revenue Royalty from 3% to
one-and-a-half percent (l.5%) by paying to the Vendors the aggregate sum of
$1,000,000.00
The Browns Hole Property is located in the well-known La Sal uranium district in
southeastern Utah. The property is located west of the Pandora mine, which is
currently the district's only active uranium producer.
Important Uranium-vanadium deposits occur in the 150 Million year old Salt Wash
sandstones of the Morrison formation in the La Sal district. A number of
significant Uranium mines are located in the La Sal district. These include the
Beaver Shaft, Mike, Hecla, La Sal, Rattlesnake and the Pandora mine. Although
the district was a "late bloomer" during the previous Uranium cycle, the Salt
Wash Uranium production numbers for La Sal were second only to those of the
Uravan mineral belt.
The discovery of the Pandora ore body, close to the eastern end of the La Sal
trend, in the late 1960s marked the beginning of the definition of the main La
Sal mineralized belt. During the 1970s and early 1980s the La Sal district
remained very active with mines being operated in particular by Union Carbide
Corporation and Atlas Minerals. These mines included Beaver Shaft, Mike,
Snowball, Hecla, La Sal and Pandora. Production from the district continued
until the mid-1980s when declining Uranium markets put an end to activities. In
2006 the Pandora mine was re-opened and is currently the district's only active
producer.
The La Sal area lies within the Paradox Basin of southeast Utah and southwest
Colorado. The area is dominated by four major structural features, which are the
results of salt tectonics and Tertiary intrusive activity; the La Sal Mountains,
the Lisbon Valley anticline, the Pine Ridge anticline and the Coyote Wash
syncline.
Uranium-vanadium deposits occur at La Sal in the sandstones of the Salt Wash
member of the Jurassic Morrison formation. The Uranium-vanadium deposits are
concentrated in an east-west trending belt, the La Sal channel, approximately 19
km in length. Salt Wash deposits of the La Sal and the La Sal creek area
immediately to the east lie west of the Uravan mineral belt, a large arcuate
belt of collective mineralized Salt Wash channels.
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The La Sal and La Sal Creek deposits occupy a unique position in relation to
other mineral deposits in that they are located in a relatively straight channel
west of and perpendicular to the Uravan mineral belt. However, deposits in both
La Sal and the Uravan are similar in habit, ore body configuration and
sedimentological association and are obviously part of the same overall
depositional and genetic province.
Salt Wash deposits are normally elongated parallel to sedimentary trends and are
roughly elliptical in plan view. Mineralization is typically tabular and
concordant to bedding although ore can abruptly cross bedding to form "rolls".
Deposits in the La Sal area are usually more strongly elongated than typical
Salt Wash ores in other areas. Also, La Sal ores tend to have ore in tabular
bodies distributed in multiple horizons through the sands with barren sandstone
occurring between horizons.
Although the main La Sal trend displays a relatively straight configuration
several meanders are thought to exist. The Pandora and Mike ore bodies are
thought to be hosted by a meander to the south of the main mineral trend. There
is a high probability that more meanders from the main trend exist and together
with potential bifurcating channels they represent undiscovered exploration
potential in the La Sal area.
The Company visited the property and studied available data with respect to the
Property. The Property is favorably located with numerous historic mines on or
adjoining the property in a prolific Salt Wash Uranium area. The Company is
currently planning the Company's first exploration program at the property. It
is anticipated that the program will start in the fall of 2007.
B) LOA PROPERTY
This Property was purchased from Jack Day (50%), and Bob Shupe (50%) on May
23rd, 2007. The Loa Mineral Claims totaling 118 lode mining claims for an area
covering approximately 2360 acres, are located in sections 7, 8, 17, 18, 19, &
20, Township 30 South, Range 8 East, Wayne County, Utah. Access to the property
is provided by a Utah State paved state highway (Notom Road) and then via a dirt
road passable by 2-wheel drive vehicles.
The Company purchased the property for an aggregate total of $1,000,000.00, as
follows: $5,000 deposit; $20,000.00 on signing which was deemed to be May 23rd,
2007(the "Effective Date") and by June 1st, 2007 (the "Closing Date") issue to
the Vendors 200,000 restricted shares of its $0.001 par value common stock
pursuant to the terms and conditions of Rule 144 as it may apply; $25,000.00 in
six months after the Closing Date; $50,000.00 in twelve months after the Closing
Date; $100,000.00 in eighteen months after the Closing Date; $100,000.00 in
twenty-four months after the Closing Date; $100,000.00 in thirty months after
the Closing Date; $100,000.00 in thirty-six months after the Closing Date;
$100,000.00 in forty-two months after the Closing Date; $100,000.00 in
forty-eight months after the Closing Date; $100,000.00 in fifty-four months
after the Closing Date; and $200,000.00 in sixty months after the Closing Date.
And incur the following exploration expenditures of $500,000 on or before 36
months following June 1st, 2007. The total purchase cost for 100% interest is
cash totaling $1,000,000, and common shares totaling 200,000. There is no Net
Smelter Revenue Royalty payable on the property.
The Loa mineral claims are underlain by the Salt Wash Member of the Morrison
Formation. The Salt Wash member is gray to yellowish brown, lenticular quartzose
sandstone. It is thin to massive bedded but medium to thick bedding is most
common. It contains numerous interbeds of conglomeratic sandstone, conglomerate
and greenish, grayish and purple mudstones. The source area of the Salt Wash
sediments lay to the south of the Henry Mountains in northern Arizona. The
thickness of the formation varies from 20 to 525 feet and within the Henry
Mountain area. The Waterpocket Fold region where the mineral claims are located
the Salt Wash Member ranges from 175 to 250 feet in thickness.
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The Loa mineral claims occur within the Henry Mountains Complex that contains
uranium deposits in the Salt Wash member of the Morrison Formation. The deposits
within the Salt Wash member account for nearly 13 percent of the United States
uranium production. The Loa Mineral Claims are located northwest of Utah's
largest known uranium resource that contained roughly 20 million pounds in the
Bullfrog and Tony M deposits. Records for the production years 1956-1965
indicate the uranium ore mined from this area averaged 0.56 percent Uranium and
1.01 percent vanadium. Average ore grades have ranged from 0.08 percent to 1.82
percent Uranium.
Uranium deposits (Tony M, Bullfrog, Copper Bench, & Indian Bench) that are in
the pre-production stage located south of the Loa minerals claims have
delineated mineralization in three stratigraphic zones within the Salt Wash
Member of the Morrison Formation. The Salt Wash member of the Morrison Formation
has also been the best uranium producer in the Henry Mountain uranium district.
Uranium mineralization in the Henry Mountain area occurs in the thicker
channel-like lenses that have been traced for a distance greater than 5 miles
with vertical measurements up to 60 feet and as much as a mile wide. The higher
grade uranium lenses can be found at any level within these thicker sandstone
lenses but normally are bordered by mudstone near the bottom or along the edges.
The highest grade and largest deposits occur near the bottom of the channel but
numerous lower grade lenses can occur anywhere in the central portion of the
channel.
The Company is currently evaluating a proposed phase 1-work program to consist
of surface mapping, sampling, geological and radiometric surveys along with a
radon gas survey will be conducted to target the suspected areas of
mineralization and to delineate the depth and direction of any uranium bearing
formation. Upon successful completion of the phase 1-work program the Company
will conduct an exploratory drill program. The drilling program with depths not
more than 800 feet and in places less than 200 feet, will then be conducted to
verify and expand the phase 1-work program data.
C) I-70 PROPERTY
This Property was purchased from Jack Day (50%), and Bob Shupe (50%) on May
23rd, 2007. The property consists of 36 claims totaling approximately 720 acres,
located in Emery County, Utah, 30 Miles west of Green River, Utah on I-70 at
Sinbad mile exit, turn south 1.5 miles then west two miles to the head of
Sinbad. The property lies on the south side of I-70 on the east end and crosses
over to the North side of I-70 on the west end.
The Company purchased the property for an aggregate total of $50,000.00, all as
Advance Royalty Payments, as follows: $7,380.00 as a deposit; $7,620.00 on
signing which was deemed to be May 23rd, 2007(the "Effective Date") and by June
1st, 2007 (the "Closing Date") issue to the Vendors 100,000 restricted shares of
its $0.001 par value common stock pursuant to the terms and conditions of Rule
144 as it may apply; $15,000.00 in six months after the Closing Date; and
$20,000.00 in twelve months after the Closing Date; The total purchase cost for
100% interest is cash totaling $50,000, common shares totaling 100,000 and a Net
Smelter Revenue Royalty of 2%. Additionally the Company shall have the right,
exercisable at any time within 20 years from the Effective Date, to reduce the
Royalty from 2% to 0% by paying to the Vendors the aggregate sum of
$1,000,000.00
The property is located on the northeast flank of the San Rafael Swell south of
the Uinta Basin and west of the Paradox folds and fault belt. Most of the
mineralized areas are on the west flank of a broad shallow trough adjacent to
the east flank of the San Rafael Swell.
During the 1960's and the 1970's a company leased the property and did some
drilling, identifying two or three potential ore bodies. The Company has not to
date been able to obtain drill logs for the previous drill holes. The MRC mine
produced 250,000 pounds of U308 less than a mile SW of this property. The Lucky
Strike mine produced approximately 500,000 pounds U308 and is situated 10 miles
7
to the south of this property. The Temple Mountain mine produced close to a
million pounds U308 and is located 8 miles SE of this property. These claims
originally were staked in the early 1950's and held until the 1980's. They were
leased several times with a demand of a very high royalty. Very little work was
actually done on these properties due to falling ore prices and the high
royalty.
The San Rafael Swell is a large geologic feature located in south-central Utah,
USA about 30 miles (50 km) west of Green River, Utah. The San Rafael Swell,
approximately 75 miles by 40 miles (120 x 65 km), consists of a giant
dome-shaped anticline of sandstone, shale, and limestone that was pushed up
millions of years ago. Since that time, infrequent but powerful flash floods
have eroded the sedimentary rocks into numerous valleys, canyons, gorges, mesas
and buttes. The Swell is part of the Colorado Plateau physiographic region. The
claims are located in the Chinarump formation.
The San Rafael Swell was formed when deeply buried Precambrian rocks faulted, or
broke, during the Laramide orogeny, about 60 million years ago. These "basement"
rocks below the present-day Swell moved upwards relative to the surrounding
areas and caused the overlying sedimentary rocks to fold into a dome-like shape
called an anticline. The resulting structure is analogous to a series of
blankets draped over a box. Since that time, the relentless force of running
water has eroded the geologic layers, resulting in older rocks becoming exposed
in the middle of the Swell, and younger rocks exposed around the edges. Many of
the most impressive landforms are composed of more resistant rocks, including
the Jurassic Navajo Sandstone, Triassic Wingate Sandstone, and Permian Coconino
Sandstone.
The Company will be examining the property to attempt to delineate possible
extensions of uranium ore bodies. Should former drill logs not be obtainable,
the Company will complete a compilation of the geological data to attempt to
delineate extensions of uranium ore deposits. Geological and radiometric surveys
along with a radon gas survey will be conducted to target the known areas of
mineralization and to delineate the depth and direction of the uranium bearing
formation. A plan of operations will contemplate a minimum 10 hole drill
program. The drilling program with depths not more than 400 feet and in places
less than 100 feet, will then be conducted to verify and offset existing
clusters of drill holes.
OVERVIEW OF THE URANIUM INDUSTRY
The only significant commercial use for uranium is as a fuel for nuclear power
plants for the generation of electricity. According to the World Nuclear
Association, there were 435 nuclear power plants operating in the world at the
end of 2006 with an annual consumption of more than 170 million pounds of
uranium. Based on reports by the Ux Consulting Company, LLC ("Ux") worldwide
production of uranium in 2005 (the most recent year for which statistics are
available) was approximately 108 million pounds. Ux reported the gap between
production and demand has been filled by secondary supplies, such as inventories
held by governments, utilities and others in the fuel cycle, including the
highly enriched uranium (HEU) inventories which are a result of the agreement
between the US and Russia to blend down nuclear warheads. These secondary
supplies are currently meeting nearly a third of worldwide demand.
Spot market prices have risen over the past three years in anticipation of
sharply higher projected demand as a result of a resurgence in nuclear power,
and by the fact that as secondary supplies are depleted, future production will
have to rise closer to demand. Spot market prices, according to Ux, rose from
$36.25/lb to $75/lb during 2006. The spot price as of August 20th 2007 was
$90/lb.
GLOSSARY OF CERTAIN URANIUM INDUSTRY TERMS
claim A claim is a tract of land, the right to mine of which is
held under the federal General Mining Law of 1872 and
applicable local laws.
concentrates A product from a uranium mining and milling facility, which
is commonly referred to as uranium concentrate,U3O8 or U308.
8
conversion A process whereby uranium concentrates are converted into
forms suitable for use as fuel in commercial nuclear
reactors.
cut-off grade Cut-off grade is determined by the following formula
parameters: estimates over the relevant period of mining
costs, ore treatment costs, general and administrative
costs, refining costs, royalty expenses, process and
refining recovery rates and uranium prices.
gross acres Total acres under which we have mineral rights and can mine
for uranium.
mineralized
material A mineralized body which has been delineated by
appropriately spaced drilling and/or underground sampling to
support a sufficient tonnage and average grade. Such a
deposit does not qualify as a reserve, until a comprehensive
evaluation based upon unit cost, grade, recoveries, and
other material factors conclude legal and economic
feasibility.
net smelter
revenue royalty The revenue or other value received by the Grantee from
arm's length purchasers of all minerals or mineral products
produced from the Property less permitted deductions
net acres Actual acres under lease which may differ from gross acres
when fractional mineral interests are not leased.
ore Naturally occurring material from which a mineral or
minerals of economic value can be extracted at a reasonable
profit.
probable
reserves Reserves for which quantity and grade and/or quality are
computed from information similar to that used for proven
(measured) reserves, but the sites for inspection, sampling
and measurement are farther apart or are otherwise less
adequately spaced. The degree of assurance, although lower
than that for proven (measured) reserves, is high enough to
assume continuity between points of observation.
proven
reserves Reserves for which (a) quantity is computed from dimensions
revealed in outcrops, trenches, workings or drill holes;
grade and/or quality are computed from the results of
detailed sampling and (b) the sites for inspection, sampling
and measurement are spaced so closely and the geologic
character is so well defined that size, shape, depth and
mineral content of reserves are well-established.
reclamation Reclamation involves the returning of the surface area of
the mining operating areas to a condition similar to
pre-mining.
recoverable
reserves Reserves that are either proven or probable, are physically
minable and can be profitably recovered under conditions
specified at the time of the appraisal, based on a positive
feasibility study. The calculation of minable reserves is
adjusted for potential mining recovery and dilution.
reserve That part of a mineral deposit which could be economically
and legally extracted or produced at the time of the reserve
determination.
resources A resource is a concentration of naturally occurring
minerals in such a form that economic extraction is
potentially feasible.
roll front The configuration of sedimentary uranium ore bodies as they
appear within the host sand. A term that depicts an elongate
uranium ore mass that is "C" shaped.
shut in A term that refers to ceasing production or the absence of
production.
shut-in royalty A lease clause permitting the extension of a lease not held
by production by payment of a per acre royalty.
spot price The price at which uranium may be purchased for delivery
within one year.
9
surety
obligations A bond, letter of credit, or financial guarantee posted by a
party in favor of a beneficiary to ensure the performance of
its or another party's obligations, e.g., reclamation bonds,
workers' compensation bond, or guarantees of debt
instruments.
tailings Waste material from a mineral processing mill after the
metals and minerals of a commercial nature have been
extracted; or that portion of the ore which remains after
the valuable minerals have been extracted.
uranium or uranium
concentrates U3O8, U308 or triuranium octoxide.
U3O8 or U308 Triuranium octoxide equivalent contained in uranium
concentrates, referred to as uranium concentrate.
waste Barren rock in a mine, or uranium in a rock formation that
is too low in grade to be mined and milled at a profit.
B) PORTABLE PIPE VISE
The Company was initially formed to market an equipment product called the
"Portable Pipe Vise" and purchased the patent in March of 2002. The jaws of
these locking pliers have a patented design and are intended to secure
cylindrical objects to a flat surface. Since the time that the Company took
possession of the first production run, it marketed the product through direct
mailing fliers and processed orders from independent equipment retailers. Our
product is currently offered in equipment retailer's catalogs, both in print and
online.
We currently hold an assignment of the patent for the locking pliers. The patent
was granted by the United States Patent and Trademark Office on November 6, 2001
and is patent number 6,311,589. A patent lasts for 16 years from the date of
filing. The date of filing of the patent was April 8, 1999. Therefore, we will
enjoy protection for the patented portion of the product, until April 8, 2015.
The patent covering the product was purchased from the inventor in March 2002.
The Company has a royalty agreement with the inventor whereby the inventor
receives 5% of gross sales as additional compensation for the sale of the
patent.
Since obtaining the initial production run, the Company has sold a limited
number of Portable Pipe Vises. Many of the Company's competitors in the
equipment business have significantly greater financial, marketing, technical
and other resources than the Company and due to the size of these competitors,
they may be able to produce a tool with a different design, but with a similar
function which can be marketed at a price lower than which we can market our
product. Accordingly, the Company has decided to market this product only until
the existing inventory has been disposed of. The Company is currently examining
other products to determine whether the Company can secure a more viable range
of equipment to market.
The Company is currently operating with no paid employees. Mrs. Suzanne Barth,
who is responsible for all day-to-day operations of the Company, is currently
working for no compensation. Mr. Edward A. Barth and Mr. Swearengin had agreed
to work for the corporation for no compensation until such time as the Company
commences to receive revenues from its Portable Pipe Vise. Mr. Barth and Mr.
Swearengin had previously received compensation, either directly or accrued, for
services rendered. However, Mr. Barth and Mr. Swearengin will be entitled to
receive compensation from the Company for his services with regard to the
Company's mineral exploration activities.
10
ITEM 2 - DESCRIPTION OF PROPERTY
OFFICE PREMISES
At the present time, the Company's principal offices are located at 800-2300
West Sahara Avenue, Las Vegas, Nv 89102. These offices are rented on a
month-to-month basis for the sum of approximately $600 per month including
secretarial, equipment usage and reception. The Company also maintains offices
at 5046 East Boulevard NW, Canton, Ohio 44718. These offices are being utilized,
rent free, by the Company and are owned by Mr. Edward A. Barth. Management for
the Company believes that the rented space will be sufficient for the needs of
the Corporation for at least the next 12 months.
For information on our mining properties and claims, please see Item 1.
Description of Business above.
ITEM 3 - LEGAL PROCEEDINGS
At the present time, the Company is not a party to any legal proceedings and is
unaware of any claims that may result in future legal proceedings against it or
that it may have against third-parties.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were presented for a vote to the shareholders of the Company during
the fourth quarter of its fiscal year.
ITEM 5 - MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
MARKET INFORMATION
Our common stock is traded on the NASD OTC Bulletin Board under the symbol USAU.
The following table sets for the periods indicated the high and low trades per
share of our common stock. Quotations commenced on the OTC Bulletin Board on
December 16, 2005. These over-the-counter market quotations reflect inter-dealer
prices without retail mark-up, mark-down or commission and may not necessarily
represent actual transactions:
Quarter Ended High Low
------------- ---- ---
August 31, 2006 $0.07 $0.07
November 30, 2006 $0.19 $0.19
February 28, 2007 $0.51 $0.51
May 31, 2007 $1.00 $0.95
HOLDERS:
We have approximately 60 registered shareholders of record as of August 20,
2007.
SHARE PURCHASE OPTIONS:
At August 24, 2007, there were no share purchase options outstanding.
We have not authorized any securities for issuance under equity compensation
plans.
Dividends: We have not declared any cash dividends, nor do we intend to do so.
We are not subject to any legal restrictions respecting the payments of
dividends, except that they may not be paid to render us insolvent. Dividend
policy will be based on our cash resources and needs and it is anticipated that
all available cash will be needed for our operations in the foreseeable future.
11
RECENT SALES OF UNREGISTERED SECURITIES.
In March and April 2007 we sold 232,042 shares of common stock at $0.50 per
share (an aggregate of $116,021) in a transaction not involving a public
offering under Section 4(2) of the Securities Act of 1933, as amended, and
Regulation D thereunder, to certain accredited investors.
In June 2007 we issued 400,000 shares of common stock at $1.15 per share (an
aggregate of $460,000) in a transaction not involving a public offering under
Section 4(2) of the Securities Act of 1933, as amended, and Regulation D
thereunder, to certain property vendors.
In June 2007 we sold 550,000 shares of common stock at $0.70 per share (an
aggregate of $385,000) in a transaction not involving a public offering under
Section 4(2) of the Securities Act of 1933, as amended, and Regulation D
thereunder, to certain accredited investors. The Company paid a fee of $38,500
represented by 55,000 shares of Common stock to a placement agent in connection
with the offering.
In June 2007 we sold 95,154 shares of common stock at $0.50 per share (an
aggregate of $47,577) in a transaction not involving a public offering under
Section 4(2) of the Securities Act of 1933, as amended, and Regulation D
thereunder, to certain accredited investors in repayment of outstanding
shareholder loans, to certain accredited investors of which Edward A. Barth, a
director of the Company, is an affiliate.
ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS FOR PLAN OF OPERATION
BUSINESS OVERVIEW
The primary business of our Company is the acquisition, exploration and
exploitation of mineral properties having the potential to host economically
viable uranium deposits. The Company's geographic area of interest is the state
of Utah and the "Four Corners" area, where the states of Utah, Arizona, Colorado
and New Mexico intersect. The major geographical feature is the 90,000 square
mile Colorado Plateau which is rich in coal, oil shale and uranium.
Specifically, management is focused on the acquisition and development of near
term production properties in the Colorado plateau within economic hauling
distance to Denison Mines' White Mesa uranium & vanadium mill in Blanding, Utah.
As of August 24, 2007, the Company has acquired interests in three mineral
properties.
CASH REQUIREMENTS
We are a start-up exploration company and must raise cash to implement our
business plan. The Company is in the process of acquiring and evaluating mineral
properties, therefore our cash requirements over the next twelve months depend
to a certain degree on acquisition opportunities as well as discoveries on our
properties. The payment requirement for properties that have been acquired, or
are being acquired after May 31, 2007 for the next twelve months is $154,461. To
continue operations and commence exploration on our current properties,
management estimates that the Company will require approximately $2,500,000.
We are in the process of negotiating a private placement. Summertime is
traditionally a slow time to raise cash for small issuers; however management is
in discussions with numerous groups and individuals and anticipates closing this
financing within the next two months.
12
Since February 28 2007 we have received shareholder loans totaling $1,700 for
property payments, office expenses, and exploration costs. Management
anticipates meeting the Company's short term cash requirements through
additional loans from shareholders and subscriptions for the private placement.
PURCHASE OF SIGNIFICANT EQUIPMENT
We do not intend to make any significant equipment purchases over the next
twelve months, other than office furnishings and computers.
EMPLOYEES
Currently our only employees are our directors and officers. We do not expect
any material changes in the number of employees over the next twelve months. We
do and will continue to outsource contract consultant employment as needed.
Over the past two fiscal years, USA URANIUM has received $652 and $2,982 in
revenues from sale of product. The Company's total assets exceed its total
liabilities by a total of $522,398 for the fiscal year ended May 31, 2007.The
Company's current liabilities exceed its current assets by a total of $156,847
for the fiscal year ended May 31, 2007. During the past two fiscal years, USA
URANIUM has had operations loses of $40,567 for 2006 and $125,120 for 2007.
These losses were incurred as a result of continuing operating expenses and
negligible revenues being received by the Company.
Current funds available to the Company will not be adequate for it to be
competitive in the areas in which it intends to operate. Therefore, the Company
will need to raise additional funds in order to fully implement its business
plan. The Company will attempt to raise approximately $2,500,000 in additional
funds during the next 12 months through a private placement. However, there can
be no assurance that the Company will be successful in raising such additional
funds.
Regardless of whether the Company's cash assets prove to be inadequate to meet
the Company's operational needs, the Company might seek to compensate providers
of services by issuance of stock in lieu of cash. The Company now has been
operating for four years and however, due to the slow product sales and no
revenue anticipated from its mineral properties it is unlikely that over the
next twelve months, it will receive revenues in an amount that would be
sufficient to pay current operating expenses.
Additionally as business activities increase, the Company will incur additional
liabilities in the form of employee and officer salaries, which are currently
being waived by the company's employee and its officers.
OFF - BALANCE SHEET ARRANGEMENTS
At present, the Company has no off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on the Company's financial
condition.
13
ITEM 7 - FINANCIAL STATEMENTS
HOBE & LUCAS
CERTIFIED PUBLIC ACCOUNTANTS, INC.
4807 Rockside Road
Suite 510
Independence, Ohio 44131
Tel: (216) 524-8900
Fax: (216) 524-8777
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
of USA Uranium Corp. fka Trilliant, Inc.
Las Vegas, Nevada
We have audited the balance sheets of USA Uranium Corp. fka Trilliant, Inc. (a
development stage company) as of May 31, 2007 and 2006, and the related
statements of operations, stockholders' equity (deficit), and cash flows for the
years then ended, and the period beginning June 20, 2001 (inception) and ended
May 31, 2007. 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 auditing 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. 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
audits provide 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 USA Uranium Corp. as of May 31,
2007 and 2006, and the results of its operations and its cash flows for the
years then ended, and the period beginning June 20, 2001 (inception) and ended
May 31, 2007 in conformity with U.S. generally accepted accounting principles.
The accompanying financial statements have been prepared assuming USA Uranium
Corp. will continue as a going concern. As discussed in Note 1 to the financial
statements, the Company has incurred losses that have resulted in an accumulated
deficit. This condition raises substantial doubt about he Company's ability to
continue as a going concern. Management's plans regarding this matter are
described in Note 1. The financial statements do not include any adjustments
that might result from the outcome it this uncertainty.
/s/ Hobe & Lucas
----------------------------------
Certified Public Accountants, Inc.
Independence, Ohio
August 22, 2007
14
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Balance Sheets
May 31, May 31,
2007 2006
----------- -----------
ASSETS
Current assets:
Cash in bank $ 19,097 $ 54
Accounts receivable -- 178
Note receivable 60,000 --
Inventory 20,922 21,436
----------- -----------
Total Current Assets 100,019 21,668
----------- -----------
Property, plant and equipment
Unpatented mining claims 1,464,281 --
Computer equipment - net of depreciation of $197 at
May 31, 2007 and -0- at May 31, 2006 4,044 --
----------- -----------
Net Fixed Assets 1,468,325 --
----------- -----------
Other assets:
Patent - net of amortization of $4,950 at May 31, 2007
and $3,959 at May 31,2006 7,749 8,740
----------- -----------
Total Assets $ 1,576,093 $ 30,408
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
Current liabilities:
Current portion of notes payable $ 154,461 $ --
Accounts payable 53,093 41,284
Accounts payable - stockholder 28,553 20,603
Note payable - stockholder 18,150 12,250
Accrued interest - stockholder 2,471 665
Accrued royalties 9 2
Accrued warranty 129 128
----------- -----------
Total Current Liabilities 256,866 74,932
----------- -----------
Notes payable-unpatented mining claims 796,829 --
----------- -----------
Stockholders' equity (deficiency):
Common stock, $0.001 par value, 100,000,000 shares authorized,
60,400,000 issued and outstanding at May 31, 2007 and 2006 60,400 60,400
Additional paid-in capital 192,699 192,699
Stock subscriptions payable - 864,082 shares issued in June, 2007 692,042 --
(Deficit) accumulated during development stage (422,743) (297,623)
----------- -----------
Total Stockholders' Equity (Deficiency) 522,398 (44,524)
----------- -----------
Total Liabilities and Stockholders' Equity $ 1,576,093 $ 30,408
=========== ===========
The accompanying Notes are an integral part of these financial statements
15
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Statements of Operations
June 20, 2001
For the Twelve Months Ended (Inception)
------------------------------- through
May 31, May 31, May 31,
2007 2006 2007
------------ ------------ ------------
Sales - net $ 652 $ 2,982 $ 13,235
Cost of Sales 419 1,635 6,452
------------ ------------ ------------
Gross Profit 233 1,347 6,783
Expenses
General and administrative expenses 120,148 39,171 416,113
Depreciation and amortization 1,189 990 5,147
Damaged and defective items 47 1,088 1,135
------------ ------------ ------------
121,384 41,249 422,395
------------ ------------ ------------
(Loss) from Operations (121,151) (39,902) (415,612)
Other income (loss)
Miscellaneous income 21 -- 50
Miscellaneous expense -- -- (203)
Interest expense (3,990) (665) (6,907)
Bad debts -- -- (71)
------------ ------------ ------------
Total Other Income (Expense) (3,969) (665) (7,131)
Net (loss) $ (125,120) $ (40,567) $ (422,743)
============ ============ ============
Net (loss) per share - basic and fully diluted $ (0.0021) $ (0.0007)
============ ============
Stockholders' Equity:
Weighted average number of common shares
outstanding - basic and fully diluted 60,486,563 60,131,507
============ ============
The accompanying Notes are an integral part of these financial statements
16
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Statement of Stockholders' Equity
(Deficit)
Issued Accumulated
Common Common Additional During the
Stock Stock Paid-In Subscriptions Development
Shares Amount Capital Payable Stage Total
------ ------ ------- ------- ----- -----
Issurance of Common Stock
September, 2001 28,000,000 $28,000 $ (26,101) -- -- $ 1,899
Issuance of Common Stock
December 2001, net
of issuance costs of $2,500 12,000,000 12,000 15,500 -- -- 27,500
Net (Loss) - May 31, 2002 -- -- -- $ (77,629) (77,629)
---------- ------- --------- --------- --------- ---------
Balance at May 31, 2002 40,000,000 40,000 (10,601) -- (77,629) (48,230)
========== ======= ========= ========= ========= =========
Net (Loss) for the year ended
May 31, 2003 -- -- -- (86,067) (86,067)
---------- ------- --------- --------- --------- ---------
Balance at May 31, 2003 40,000,000 40,000 (10,601) -- (163,696) (134,297)
========== ======= ========= ========= ========= =========
Issuance of Common Stock
November, 2003 20,000,000 20,000 80,000 -- -- 100,000
Net (Loss) for the year ended
May 31, 2004 -- -- -- (52,252) (52,252)
---------- ------- --------- --------- --------- ---------
Balance at May 31, 2004 60,000,000 60,000 69,399 -- (215,948) (86,549)
========== ======= ========= ========= ========= =========
Forgiveness of debt by Stockholders
November, 2004 -- 96,700 -- -- 96,700
Net (Loss) for the year ended
May 31, 2005 -- -- -- (41,108) (41,108)
---------- ------- --------- --------- --------- ---------
Balance at May 31, 2005 60,000,000 60,000 166,099 -- (257,056) (30,957)
========== ======= ========= ========= ========= =========
Issuance of Common Stock
February, 2006 400,000 400 9,600 -- -- 10,000
Forgiveness of debt by Stockholder
February, 2006 -- -- 17,000 -- -- 17,000
Net (Loss) for the year ended
May 31, 2006 -- -- -- (40,567) (40,567)
---------- ------- --------- --------- --------- ---------
Balance at May 31, 2006 60,400,000 60,400 192,699 -- (297,623) (44,524)
========== ======= ========= ========= ========= =========
Subscriptions payable for cash,
May, 2007 -- -- $ 232,042 -- 232,042
Subscriptions payable for purchase
of unpatented mining claims
May, 2007 -- -- 460,000 -- 460,000
Net (Loss) for the year ended
May 31, 2007 -- -- -- (125,120) (125,120)
---------- ------- --------- --------- --------- ---------
Balance at May 31, 2007 60,400,000 $60,400 $ 192,699 $ 692,042 $(422,743) $ 522,398
========== ======= ========= ========= ========= =========
The accompanying Notes are an integral part of these financial statements
17
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Statements of Cash Flows
June 20, 2001
For the Twelve For the Twelve (Inception)
Months Ended Months Ended through
May 31, May 31, May 31,
2007 2006 2007
--------- --------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) $(125,120) $ (40,567) $(422,743)
Adjustments to reconcile net (loss) to cash
provided (used) by operating activities:
Depreciation and amortization expense 1,189 990 5,147
Compensation related to stock issuance -- 2,000 2,000
Decrease in accounts receivable 178 2,031 --
(Increase) in note receivable (60,000) (60,000)
Decrease (Increase) in inventory 513 2,845 (20,923)
Interest capitalized 2,009 -- 3,305
Increase in accounts payable 11,809 17,735 53,093
Increase in accrued wages and director fees -- -- 119,201
Increase in accrued interest - stockholder 1,806 665 2,471
Increase in accrued rent -- -- 2,500
Increase in stockholders payable 7,950 2,083 28,553
Increase (decrease) in accrued royalties 7 (108) 9
Increase (Decrease) in accrued warranty 1 (6) 129
--------- --------- ---------
Net cash (used in) operating activities (159,658) (12,332) (287,258)
--------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of unpatented mining claims (55,000) -- (55,000)
Purchase of computer equipment (4,241) -- (4,241)
Purchase of patent -- -- (10,800)
--------- --------- ---------
Net cash (used in) investing activities (59,241) -- (70,041)
--------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Loans from stockholder 5,900 12,250 28,950
Repayment of loans - stockholders -- -- (12,096)
Proceeds from issuance costs of $2,500 -- -- 127,500
Proceeds from stock subscriptions payable 232,042 -- 232,042
--------- --------- ---------
Net cash provided by financing activities 237,942 12,250 376,396
--------- --------- ---------
Net (decrease) in cash 19,043 (82) 19,097
Cash and equivalents - beginning 54 136 --
--------- --------- ---------
Cash and equivalents - ending $ 19,097 $ 54 $ 19,097
========= ========= =========
Cash paid for:
Interest $ 274 $ -- $ 274
========= ========= =========
Income taxes $ -- $ -- $ --
========= ========= =========
Supplemental disclosure of non-cash investing and financing activities:
On September 27, 2001, 28,000,000 shares of common stock were issued at a
value of $1,899 in return for a contribution of the patent option.
In March of 2003, interest accrued on stockholder loans payable in the
amount of $1,296 was added to the ouststanding loan balance when the loans were
renewed.
In November of 2004, certain officers, directors, and stockholders of the
company forgave accrued wages, director's fees, and rents totaling $96,700.
These transactions are reflected as increases to paid-in capital.
On May 23, 2007, 400,000 shares of common stock were subscribed at a value
of $460,000 in connection with the purchase of unpatented mining claims.
On May 23, 2007, three notes payable were exchanged for unpatented mining
claims totaling $949,281.
The accompanying Notes are an integral part of these financial statements
18
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
May 31, 2007 and 2006
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant policies of USA Uranium Corp., (formerly Trilliant,
Inc.) (hereinafter the "Company"), is presented to assist in understanding the
financial statements. The financial statements and notes are representations of
the Company's management, which is responsible for their integrity and
objectivity. These accounting policies conform to accounting principles
generally accepted in the United States of America and have been consistently
applied in the preparation of the financial statements.
NATURE OF OPERATIONS
As of May, 2007, the Company is primarily engaged in the exploration and
development of uranium mines. A secondary nature of operations, which is
minimal, is the sale of specialized locking pliers which are used primarily by
the plumbing and welding industries. The Company's product is sold primarily to
wholesalers. The Company recognizes its revenues as required by Staff Accounting
Bulletin No. 101 "Revenue Recognition in Financial Statements". Revenue is only
recognized on product sales once the product has been shipped to the customers
(FOB Origin), and all other obligations have been met.
ACCOUNTS RECEIVABLE
The Company grants credit to its customers in the ordinary course of business.
The Company provides for an allowance for uncollectible receivables based on
prior experience. The allowance was $-0- at May 31, 2007 and 2006.
INVENTORIES
Inventories which consist of specialized locking pliers are recorded at the
lower of cost (first-in, first-out) or market.
ADVERTISING AND MARKETING COSTS
Advertising and marketing costs incurred in the normal course of operations are
expensed accordingly. Advertising and marketing costs incurred for the years
ended May 31, 2007 and 2006 were $514 and $507 respectively.
19
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
May 31, 2007 and 2006
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont'd)
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States 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 from those estimates.
DEVELOPMENT STAGE ENTITY
The Company was incorporated in the state of Nevada on June 20, 2001. It was
primarily engaged in the development and marketing of new products on which it
holds the patent. Beginning in May, 2007, the Company is engaged in the
development of uranium mines. Realization of a major portion of its assets is
dependent upon the Company's ability to successfully develop and market its
products, meet its future financing requirements, and the success of future
operations. These factors raise substantial doubt about the Company's ability to
continue as a going concern. These financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
CONCENTRATIONS OF RISK
The Company's cash is deposited in FDIC-insured banks. The funds are insured up
to $100,000. Periodically the cash in the bank exceeds federally insured limits.
DEPRECIATION
The company depreciates property, plant and equipment over its estimated useful
lives on a straight line basis. Useful lives of properly, plant and equipment
range between 5 and 7 years.
NOTE 2 - FAIR VALUE OF FINANCIAL STATEMENTS
The carrying amount of cash, accounts receivable and liabilities approximates
the fair value reported on the balance sheet.
20
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
May 31, 2007 and 2006
NOTE 3 - NEW ACCOUNTING PROCEDURES
There are no new accounting procedures that impact the Company for its May 31,
2007, fiscal year.
NOTE 4 - CONCENTRATIONS
All the Company's mine properties are located in one geographic area in Utah.
The Company has purchased its entire inventory of locking pliers from one
supplier.
Sales to the Company's largest customer were $358 and $1,256 for the years ended
May 31, 2007 and 2006, respectively.
NOTE 5 - INCOME TAXES
Income taxes on continuing operations at May 31 include the following:
June 20, 2001
(inception) to
May 31,
2007 2006 2007
-------- -------- --------
Currently payable $ -0- $ -0- $ -0-
Deferred -0- -0- -0-
-------- -------- --------
Total $ -0- $ -0- $ -0-
======== ======== ========
A reconciliation of the effective tax rate with the statutory U.S. income tax
rate at May 31 is as follows:
June 20, 2001
(inception) to
2007 2006 May 31, 2007
------------------ ------------------ -------------------
% of % of % of
Pretax Pretax Pretax
Income Amount Income Amount Income Amount
------ ------ ------ ------ ------ ------
Income taxes per statement of operations $ -0- 0% $ -0- 0% $ -0- 0%
Loss for financial reporting purposes
without tax expense or benefit $ (42,541) (34)% (13,793) (34)% $(143,733) (34)%
--------- ------ --------- ------ --------- ------
Income taxes at statutory rate $ (42,541) (34)% $ (13,793) (34)% $(143,733) (34)%
========= ====== ========= ====== ========= ======
21
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
May 31, 2007 and 2006
NOTE 5 - INCOME TAXES (CONTINUED)
Deferred taxes are provided for temporary differences in deducting expenses for
financial statement and tax purposes. The principal source for deferred tax
assets is net operating loss carryforwards. No deferred taxes are reflected on
the balance sheet at May 31, 2007 or 2006 due to a valuation allowance, which
increased by $41,800 in 2007 and by $5,200 in 2006.
The components of and changes in the net deferred taxes were as follows:
2007 2006
-------- --------
Deferred tax assets:
Net operating loss carryforwards $ 98,000 $ 56,000
Compensation and Miscellaneous -0- 200
-------- --------
Deferred tax assets 98,000 56,200
Valuation Allowance (98,000) (56,200)
-------- --------
Net deferred tax assets: $ -0- $ -0-
======== ========
The Company has incurred losses that can be carried forward to offset future
earnings if conditions of the Internal Revenue Code are met. These losses are as
follows:
Expiration
Year of Loss Amount Date
------------ ------ ----
Year Ended 5/31/02 $ 11,846 5/31/2022
Year Ended 5/31/03 34,067 5/31/2023
Year Ended 5/31/04 52,753 5/31/2024
Year Ended 5/31/05 24,774 5/31/2025
Year Ended 5/31/06 40,188 5/31/2026
Year Ended 5/31/07 $125,619 5/31/2027
NOTE 6 - RENT - STOCKHOLDER
The Company rents office and storage space from one of its stockholders on a
month-to-month basis. For the years ended May 31, 2007 and 2006, the stockholder
has agreed to provide these facilities rent-free.
22
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
May 31, 2007 and 2006
NOTE 6 - RENT - STOCKHOLDER (continued)
During 2007, the Company rented office space from another stockholder on a
month-to-month basis.
Rent expenses for the years ended May 31, 2007 and 2006 were $7,500 and -0-
respectively. Rent expense was $18,500 for the period June 20, 2001 (inception)
to May 31, 2007.
NOTE 7 - ACCRUED WAGES - STOCKHOLDER
A stockholder of the Company had accrued wages in the amount of $-0- and -0- at
May 31, 2007 and 2006. Per his employment agreement, these wages can only be
paid from the net profits of the Company. As such, no cash wages have been paid
to this stockholder to date. During November, 2004 $75,000 of accrued wages was
written off as part of the related party debt forgiveness (Note 13).
NOTE 8 - ACCOUNTS PAYABLE - STOCKHOLDERS
A stockholder of the Company has advanced funds to the Company totaling $28,553
and $20,603 at May 31, 2007 and 2006, respectively. The advances are not secured
by notes and are payable upon demand.
NOTE 9 - NOTES PAYABLE - STOCKHOLDER
Notes payable to a stockholder of the Company consisted of the following at May
31, 2007 and 2006:
Note dated June 7, 2005 payable on demand and
Bearing interest at ten percent per annum $ 4,000
Note dated December 21, 2005 payable on demand and
Bearing interest at ten percent per annum 5,000
Note dated April 6, 2006 payable on demand and
Bearing interest at ten percent per annum 3,250
-------
Balance, May 31, 2006 12,250
Note dated June, 2006 payable on demand and
Bearing interest at ten percent per annum 5,900
-------
Balance, May 31, 2007 $18,150
=======
23
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
May 31, 2007 and 2006
NOTE 10 - AMORTIZATION OF PATENT
The Company held an option to purchase the patent pending rights to its
proprietary product, locking pliers. The Company exercised its option to acquire
the patent for its locking pliers product in March 2002 for $12,699. The patent
is being amortized over its remaining legal life, beginning in the first quarter
of fiscal 2002. The agreement also provides for payment of five percent of the
gross consideration received for the use and licensing of the patent.
Amortization for the next five years is as follows:
2007 $ 990
2008 990
2009 990
2010 990
2011 990
Thereafter 2,799
-------
$ 7,749
=======
NOTE 11 - LOSS PER COMMON SHARE
In May, 2005 the Company recognized a stock split of ten shares for each
outstanding share. Then in January, 2007, the Company recognized a stock split
of four shares for each outstanding share. As a result, the weighted average
shares outstanding have been retroactively restated to reflect the impact of the
split. Loss per common share is based on the weighted average number of shares
outstanding which was 60,486,563 and 60,131,507 for the years ended May 31, 2007
and 2006, respectively.
NOTE 12 - PRODUCT WARRANTIES
The Company sells its products to customers together with limited repair or
replacement warranties. The accompanying financial statements for 2007 and 2006
include, respectively, $8 and $58 for estimated warranty claims, based on the
Company's experience of the amount of such claims actually paid. Following is a
reconciliation of the aggregate warranty liability as of May 31, 2007:
Balance, May 31, 2005 $ 134
Claims paid during 2006 (64)
Additional warranties issued during 2006 58
Revisions in estimates for previously issued warranties -0-
------
Balance, May 31, 2006 $ 128
------
Claims paid during 2007 (7)
Additional warranties issued during 2007 8
Revisions in estimates for previously issued warranties -0-
------
Balance, May 31, 2007 $ 129
======
24
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
May 31, 2007 and 2006
NOTE 13 - FORGIVENESS OF DEBT - RELATED PARTIES
During November, 2004, certain officers, directors, and shareholders of the
Company forgave accrued wages, director's fees and rents totaling $96,700. These
transactions are reflected as increases to paid-in capital. During February,
2006, an officer and stockholder of the Company forgave accrued wages in the
amount of $17,000. This transaction is reflected as an increase in paid-in
capital.
NOTE 14 - NOTES PAYABLE
Long-term debt consists of the following:
Note payable to two individual stockholders due
May 23, 2012, payable semi-annually at varying
amounts, bearing interest at ten percent per
annum, and secured by 118 unpatented mining claims. $ 718,067
Note payable to two individual stockholders due
May 23, 2010, payable semi-annually at varying
amounts, bearing interest at ten percent per
annum, and secured by 63 unpatented mining claims. 198,223
Note payable to two individual stockholders due
May 23, 2008, payable semi-annually at varying
amounts, bearing interest at ten percent per
annum, and secured by 36 unpatented mining claims. 35,000
---------
Total long-term debt 951,290
Less: current portion (154,461)
---------
Net long-term debt $ 796,829
=========
Future principal payments are as follows:
2008 $ 154,461
2009 240,438
2010 229,855
2011 138,991
2012 187,545
---------
$ 951,290
=========
25
USA Uranium Corp.
(Formerly Trilliant, Inc.)
(A Development Stage Company)
Notes to the Financial Statements
May 31, 2007 and 2006
NOTE 15 - ADDITIONAL LIABILITY
The Company is required to incur $500,000 in exploration expenditures before
June 2, 2010 as part of its agreement to purchase certain unpatented mining
claims.
NOTE 16 - SUBSCRIPTIONS PAYABLE
The Company has received cash for common stock shares which have yet to be
issued:
On March 1, 2007 Naturally Creative Holdings paid $42,042 for 84,082 restricted
shares.
On March 14, 2007 Ryan Howardson paid $50,000 for 100,000 restricted shares.
On March 16, 2007 Gary Cowan paid $40,000 for 80,000 restricted shares.
On April 30, 2007 Naturally Creative Holdings paid $100,000 for 200,000
restricted shares.
On May 23, 2007 $460,000 for 400,000 restricted shares towards purchase of
unpatented mining claims per purchase agreements of same date.
As of May 31, 2007, there is a total of $692,042 for subscription payables.
Shares were issued in June, 2007.
NOTE 17 - SUBSEQUENT EVENTS
On June 11, 2007, the Company received $385,000 for 550,000 shares of common
stock which have yet to be issued.
On June 18, 2007 the Board of Directors resolved to convert outstanding
stockholder loans totaling $47,577 to equity by issuing 95,154 restricted shares
of common stock.
26
ITEM 8 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None
ITEM 8A - CONTROLS AND PROCEDURES
The management of the Company recognizes its responsibility for establishing and
maintaining adequate internal controls over financial reporting for the Company.
Due to the small size of the company, the Company's Chief Executive Officer and
Chief Operating Officer is aware of all matters pertaining to the operations of
the Company and has reviewed all aspects of the financial information included
in the Company's financial reporting. At the present time, management is of the
opinion that the Company's internal controls over financial reporting for the
past fiscal year is adequate. However, management has identified a material
weakness in its procedures in that the small size of management causes a lack of
segregation of duties and limits management's ability to recognize potential
inadequacies of the internal controls over the financial reporting.
ITEM 8B - OTHER INFORMATION
None
PART THREE
ITEM 9 - DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
The Executive Officers and Directors and their respective ages as of June 1,
2007 are as follows:
DIRECTORS
Name of Director: Age Term in office Other directorships held
----------------- --- -------------- ------------------------
Edward A. Barth 48 2001-2007 None
Eugene H. Swearengin 53 2001-2007 None
Gary Campbell 53 2006-2007 None
Earl Abbott 62 2007 Four
EXECUTIVE OFFICERS
Executive Officer: Age: Office Term in office
------------------ ---- ------ --------------
Edward A. Barth 48 President, Chief Executive 2001-2007
Officer Secretary and Treasurer
Eugene H. Swearengin 53 Vice-President and Secretary 2001-2007
Edward A. Barth, age 47, is the Founder and Principal Officer of Registrant, and
serves as a Director. Mr. Barth received a Bachelor of Science degree in civil
engineering technology from Youngstown State University in 1984. He has been
employed by the City of North Canton, Ohio, Michael Baker Engineering
Corporation and in 1990 returned to the family construction business where he
served as President of Barth Construction Co., Inc. In August 2001 Mr. Barth
changed the name of the corporation to Stark Concrete Leveling, Inc. and
presides as President of the leveling and concrete rehabilitation business. Mr.
Barth continues to be employed by Stark Concrete Leveling, Inc. He resides in
Canton, Ohio.
27
Eugene H Swearengin, age 53, has been a Director of the Registrant since June
21, 2001. He is Vice-president and Secretary of the Corporation. Mr. Swearengin
started his career as an apprentice carpenter. He successfully obtained his
journeyman's card in 1977. In 1998 he purchased a 50% interest in Callahan Door
Sales, Inc. Mr. Swearengin has been a businessman and has managed a successful
career in the garage and entrance door business for the past 25 years. He
resides in North Canton, Ohio.
Gary Campbell, age 53, has been a Director of the Registrant since December
2006. Mr. Campbell was the CEO and a Director of Screenphone.net Inc. from
October 1999 to November 2003 a private Nevada Internet appliance company
developing the software, content and applications for web browsing telephones.
Previously as a former telecommunications, high technology and mining attorney,
Mr. Campbell was responsible for advising on the legal and business affairs of
telecommunications, advanced technology and mining transactions. Mr. Campbell
was a Director and CEO of Rocketinfo Inc. from June 2004 until April 2006 and
was a Director and CEO of NationsRx Inc. from December 2003 until August 2006
both companies reporting on a US Exchange. Mr. Campbell has degrees in both
Commerce and Law. He resides in Palm Desert, California.
Earl W. Abbott, age 62 was appointed as a Director in June 2007. Dr. Abbott is a
senior geologist with thirty-three years of experience in mineral exploration
for large and small companies in the western United States, Alaska, Mexico,
China, Africa, and Costa Rica. From 2004 to present Dr. Abbott has been the
President, Chief Executive Officer, Secretary, and a Director of Tornado Gold
International Corp. and a Director of AAA Energy Inc. from 2004 to present both
companies reporting on a US exchange. From 2003 to the present, Dr. Abbott has
been the president of Big Bar Gold Corp., and from 2007 to present he has been a
Director of Desert Gold Ventures Inc. both companies reporting on a Canadian
exchange, and from 1999 to present, Dr. Abbot has served as the president of
King Midas Resources Ltd., a private Canadian company he founded which has
acquired U.S. and Mexican gold properties. From 1982 to the Present, Dr. Abbott
has been self-employed as a geological consultant, in which he manages metallic
and industrial mineral projects and exploration programs. From 1988 to 1997, Dr.
Abbott was the Vice President and Director the Trio Gold Corp., where he managed
gold exploration activities in the U.S., Ghana, and Costa Rica. From 1983 to
1984, he served as a regional geologist for U.S. Minerals Exploration Company,
where he conducted a successful gold exploration program in Nevada & Utah. From
1978 to 1982 he was a district geologist for Energy Reserves Group, Inc. where
he opened and managed the Reno District exploration office, and managed on more
than twenty projects which included geologic mapping, geochemical surveys, and
more than 70,000 feet of rotary drilling, along with conducting uranium
exploration in Nevada, Wyoming, South Dakota, and Montana. From 1975 to 1985,
Dr. Abbott was a senior geologist with Urangesellschaft USA, Inc., where he
conceived, managed, and conducted uranium exploration programs in remote
terrains in Alaska, and from 1971 to 1975, Dr. Abbot was a project geologist for
Continental Oil Company where he supervised uranium exploration rotary drilling
programs in Wyoming.
Dr. Abbott is a member of the American Institute of Professional Geologists and
is a Certified Professional Geologist, and a past president of the Nevada
Section. He is also a member of the Geological Society of Nevada and its past
president. Dr. Abbott is also a member of the Society of Mining Engineers of
American Institute of Mining, Metallurgical and Petroleum, the Denver Region
Exploration Geologists Society and its past president, and a member of the
Nevada Petroleum Society, and served as its past president as well. Dr. Abbott
earned his Ph.D. in Geology in 1972 and his Master of Arts in Geology, 1971 from
Rice University, Houston, Texas. Dr. Abbott earned his Bachelor of Arts degree
in Geology in 1965 from San Jose State College, San Jose, California. Dr. Abbott
is not an officer or director of any other reporting company. Dr. Abbott resides
in Reno Nevada.
At the present time, the Company has not developed a code of ethics that applies
to the Company's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
28
functions. The Company maintains that the fact that all major management
functions, both executive and financial are centered in one individual, it is
not practical to establish a code of ethics at this time.
At present, the Company does not maintain an audit committee, instead the
company's Board of Directors is responsible to review all audit matters. The
Board of Directors, acting as audit committee, has Stephen Spalding acting as an
audit committee financial expert serving on the Board.
ITEM 10 - EXECUTIVE COMPENSATION
The table below summarizes all compensation awarded to, earned by, or paid to
the executive officers of THE COMPANY by any person for all services rendered in
any capacity to THE COMPANY for the present fiscal year.
Other Securities
Name and Annual Restricted Underlying All Other
Principal Compen- Stock Options/ LTIP Compen-
Position Year Salary($) Bonus sation($) Award(s)($) SARs($) Payouts($) sation($)
-------- ---- --------- ----- --------- ----------- ------- ---------- ---------
Edward A. 2003 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
Barth, 2004 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
President, CEO 2005 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
2006 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
2007 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
Eugene H. 2003 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
Swearengin, 2004 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
Vice-President, 2005 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
Secretary 2006 $ 0** 0.00 0.00 10,000 0.00 0.00 0.00
2007 $ 0* 0.00 0.00 0.00 0.00 0.00 0.00
----------
* Because the Company has not generated any significant revenue Mr. Barth and
Mr. Swearengin waived any compensation for their services commencing
January 1, 2003 related to the equipment product.
** During the 2006 fiscal year, Mr. Swearengin was granted an option to
purchase common shares of the Company in exchange for accrued wages prior
to 2003. Mr. Swearengin, in exercising the option in 2006 acquired 100,000
shares of the Company's common stock in exchange for $8,000 of accrued
wages and $2,000 of compensation.
ITEM 11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
There are no securities authorized for issuance under any equity compensation
plans. The following table provides the names and addresses of each person known
to own directly or beneficially more than a 5% of the outstanding common stock
as of June 1, 2007 and by the officers and directors, individually and as a
group. Except as otherwise indicated, all shares are owned directly.
29
Name and address Amount of beneficial
of beneficial owner ownership Percent of class
------------------- --------- ----------------
Edward A. Barth 14,053,706 22.68%
Director, President and
Chief Executive Officer
5046 East Boulevard NW
Canton, OH 44718
Suzanne I. Barth*
5046 East Boulevard NW
Canton, OH 44718
Arnie Howardson 3,169,000** 5.11%
611 N.E. 204th Street
Seattle, Wash 98155
Eugene H. Swearengin 400,000 0.64%
Director, Vice President,
Secretary
8022 Amberly Circle NW
North Canton, Ohio, 44720
----------
* Indicates husband and wife. Each individual has a beneficial ownership in
their spouse's stock holdings.
** Indicates shares held by Mr. Howardson and his son beneficially.
Common stock: All Officers and Directors as a group that consist of two
individuals, 14,453,760 shares direct representing 23.32% of the total.
The percent of class is based on 61,964,236 shares of common stock issued and
outstanding as of August 24, 2007.
ITEM 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. Edward A. Barth is the sole promoter of the Company, further, he currently
holds a control position in the business, owning a total of 22.68% of the
outstanding common stock (directly and beneficially). Prior to January 1, 2003,
Mr. Barth was accruing a salary at the rate of $5,000 per month for all services
which he rendered to the Company. Since January 1, 2003, Mr. Barth has waived
any compensation, until such time as the Company commences to receive sustained
revenues. Mr. Barth advanced the Corporation the sum of $1,212.00 in order to
pay for incorporation costs. This amount was subsequently repaid to Mr. Barth on
January 9, 2002 without interest, from proceeds received out of the $30,000.00
which the Company received in stock subscriptions. In addition, Mr. Barth has
advanced the corporation the sum of $20,000 in order to commence the first
production run of the Portable Pipe Vise. Since that time, Mr. Barth has
advanced various sums to provide the Company with necessary operating funds. To
date, the Company has repaid a portion of the amount, however, the full amount
remaining outstanding of $26,853 was converted into 53,706 shares during this
fiscal year.
Mr. Barth received the 700,000 shares of common stock in the Company in exchange
for transferring to the Company the option to purchase the patent rights to the
locking pliers. This amount increased to 7,000,000 shares as the result of a
stock split which occurred during fiscal year 2005. This amount increased to
30
28,000,000 shares as the result of a 4 for 1 stock split which occurred during
this fiscal year. At the time Mr. Barth purchased the option, the patent had not
yet been granted and was in danger of being lost as a result of the inventor's
lack of necessary funds to continue the patent process. A portion of the
personal funds, which Mr. Barth utilized in the obtaining of the patent option,
was utilized to file the necessary documentation with the United States Patent
and Trademark Office so that the patent could issue.
With the exception of the above referred to transactions, there are no
contractual agreements between Mr. Barth or any other individual, whether a
shareholder or not, and the Company.
ITEM 13 - EXHIBITS AND REPORTS ON FORM 8-K
Exhibit 3.1 - Articles of Incorporation - incorporated by reference Form SB-2
Exhibit 3.2 - By-laws - incorporated by reference Form SB-2
Exhibit 11 - Statement regarding computation of earnings per share - See
financial statement attached
Exhibit 13 - Form 10-QSB - incorporated by reference
Exhibit 14 - Code of Ethics - None
Exhibit 31.1 - Rule 13a-14(a), 15d-14(a) Certification
Exhibit 31.2 - Rule 13a-14(a), 15d-14(a) Certification
Exhibit 32.1 - Section 1350 Certifications Exhibit 32.2 - Section 1350
Certifications
ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following information concerns the aggregate fees billed for each of the
last two fiscal years for professional services rendered by Hobe & Lucas
Certified Public Accountants, Inc., the principal accountant for the Company.
2006 2007
------- -------
1. Audit Fees $12,350 $12,500
2. Audit-Related Fees -0- -0-
3. Tax Fees $ 500 $ 500
4. All Other Fees* -0- -0-
----------
* There were no other fees billed to the Company by its principal accountant
for the last two fiscal years for any products or services not covered in
items 1, 2, 3 or 4 above.
Because the Company has only four directors, none of whom are outside directors,
the Company does not maintain a standing audit committee. As such, the Company
does not have pre-approval policies and procedures regarding the engagement of
an independent auditor for its year-end financial statements. Instead, the
engagement of an auditor is approved by the ad hoc audit committee of the Board
of Directors prior to the commencement of the audit. The balance of the services
described in Items 2 or 3 above were pre-approved by the audit committee, only
to the extent that discussions were held with the principal independent
accountant for the Company prior to the commencement of any services by the
accountant, during which time all services to be performed by the accountant on
behalf of the Company were outlined.
31
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
USA Uranium Corp.
By: /s/ Edward A. Barth
-----------------------------------------
Edward A. Barth, CEO, CFO, President
and Director
Date: August 27, 2007
---------------------------------------
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Edward A. Barth
-----------------------------------------
Edward A. Barth, CEO, CFO President
and Director
Date: August 27, 2007
---------------------------------------
By: /s/ Eugene H. Swearengin
-----------------------------------------
Eugene H. Swearengin, Vice-President,
Secretary and Director
Date: August 27, 2007
---------------------------------------
By: /s/ Gary Campbell
-----------------------------------------
Gary Campbell, Director
Date: August 27, 2007
---------------------------------------
By: /s/ Earl Abbott
-----------------------------------------
Earl Abbott, Director
Date: August 27, 2007
---------------------------------------
32