UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


Form 10-Q


[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended April 30, 2020


[   ] Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from __________ to __________


Commission file number 333-215459


Venture Vanadium Inc.

 (Exact name of registrant as specified in its charter)


Nevada

(State or other jurisdiction of incorporation or organization)


1090

(Primary Standard Industrial Classification Code Number)



32-0507158

(I.R.S. Employer Identification Number)


One Oxford Centre, 301 Grant Street, Suite 4300, Pittsburgh, PA 15219

(Address of principal executive offices)


412-577-2499  

(Telephone number, including area code)


Securities registered pursuant to Section 12(b) of the Act: 

Title of each class

Symbol

Name of each exchange on which registered

None

None

None


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes (X)       No ( )


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer

 

Accelerated filer  

Non-accelerated filer


Smaller reporting company  

 

 

 

Emerging growth company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes (  )       No ( X )


State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 56,047,470 common shares issued and outstanding as of June 6, 2020.





1



Venture Vanadium Inc.



QUARTERLY REPORT ON FORM 10-Q


TABLE OF CONTENTS


Page

PART I

 FINANCIAL INFORMATION:

3




Item 1.

Financial Statements (Unaudited)

3





Balance Sheets (Unaudited) as of April 30, 2020 and October 31, 2019


Interim Unaudited Statements of Operations for the three months and six months ended April 30, 2020, and 2019


4


5


Unaudited Statements of Changes in Stockholders Equity for the six months ended April 30, 2020 and year ended October 31, 2019


Interim Unaudited Statements of Cash Flows for the six months ended April 30, 2020, and 2019


6


7


Notes to the Interim Unaudited Financial Statements

8




Item 2.

Managements Discussion and Analysis of Financial Condition and Results of Operations

11


 


Item 3.

Quantitative and Qualitative Disclosures About Market Risk

14




Item 4.

Controls and Procedures

14




PART II

OTHER INFORMATION:





Item 1.

Legal Proceedings

15




Item 1A

Risk Factors

15




Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

15

 

 


Item 3.

Defaults Upon Senior Securities

15




Item 4.

Mine Safety Disclosure

15




Item 5.

Other Information

15




Item 6.

Exhibits

15




 

 Signatures

16






2



PART 1 FINANCIAL INFORMATION


Item 1.  Financial Statements


The accompanying interim financial statements of Venture Vanadium Inc. (the Company, we, us or our) have been prepared without audit pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with United States generally accepted principles have been condensed or omitted pursuant to such rules and regulations.


The interim financial statements are condensed and should be read in conjunction with our latest annual financial statements.


In the opinion of management, the financial statements contain all material adjustments, consisting only of normal adjustments considered necessary to present fairly our financial condition, results of operations, and cash flows for the interim periods presented.


 

 

 

 

 

 

 

 


 




3

 

 



Venture Vanadium Inc.

BALANCE SHEETS

April 30, 2020

(Unaudited)


ASSETS


April 30, 2020


October 31, 2019

Current Assets





Cash and cash equivalents

$

7

$

184,939

Prepaid expense


43,750


-

Total Current Assets


43,757


184,939

Fixed Assets





Exploration Licenses (2019  Options)


1,030,050


125,050

Total Non-current Assets


1,030,050


125,050

Total Assets

$

1,073,807

$

309,989






LIABILITIES AND STOCKHOLDERS EQUITY



Liabilities





Current Liabilities

    Accounts Payable


64,539


48,928

    Related Party Loans

$

101,481

$

106,481

Total Current Liabilities


166,020


155,409






Total Liabilities


166,020


155,409






Stockholders Equity





Common stock, par value $0.001; 75,000,000 shares authorized, 56,047,470 and 54,947,470

shares issued and outstanding respectively


56,047


54,947

Discount on common stock


(21,800)


(21,800)

Additional paid in capital


1,249,024


345,124

Common stock to be issued


120,000


-

Retained earnings (accumulated deficit)


(495,484)


(223,691)

Total Stockholders Equity


907,787


154,580






Total Liabilities and Stockholders Equity

$

1,073,807

$

309,989






 





See accompanying notes, which are an integral part of these financial statements



 

 

4

 

 


 


Venture Vanadium Inc.

STATEMENTS OF OPERATIONS

Three and six months ended April 30, 2020 and 2019

(Unaudited)






Three Months Ended April 30,


Six Months Ended April 30,



2020


2019


2020


2019

Revenue


$

                                  -

$

-

$

                                  -

$

-

Cost of goods sold


-


-


-


-

Gross Profit


-


-


-


-










OPERATING EXPENSES









Work Program & Technical


149,250


-


187,250


-

Legal & Professional


15,445


-


37,637


-

Website design & Development


2,828


-


3,606


-

General and Administrative Expenses


17,608


-


43,299


-

TOTAL OPERATING EXPENSES


185,131


-


271,792


-










LOSS FROM CONTINUING OPERATIONS


(185,131)


-


(271,792)


-

LOSS FROM DISCONTINUED OPERATIONS


-


(12,393)


-


(29,607)

LOSS FROM OPERATIONS

$

(185,131)

$

(12,393)

$

(271,792)

$

(29,607)










PROVISION FOR INCOME TAXES


-


-


-


-










NET LOSS

$

(185,131)

$

(12,393)

$

(271,792)

$

(29,607)










NET LOSS PER SHARE: BASIC AND DILUTED

$

(0.00)

$

(0.00)

$

(0.00)

$

(0.00)










WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED


55,872,745


53,280,000


55,872,745


53,280,000





 







See accompanying notes, which are an integral part of these financial statements

 

 

5

 


Venture Vanadium Inc.

STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY

Six months ended April 30, 2020 and year ended October 31, 2019

 (Unaudited)






Common Stock


Additional

Paid-in





Discount on

common





Common

Stock to


Accumulat-ed Deficit


Total Stockholders


Shares

Amount


Capital


stock


be issued




Equity

Balance, October 31, 2018

53,280,000

$

53,280

$

-

$

(21,800)

$

-

$

(38,487)

$

(7,007)

Shares issued for cash

-


-


-


-


-


-


-

Net loss

-


-


-


-




(17,214)


(17,214)

Balance, January 31, 2019

53,280,000

$

53,280

$

27,040

$

(21,800)

$

-

$

(55,701)

$

(24,221)

Shares issued for cash

-


-


-


-


-


-


-

Net loss

-


-


-


-




(12,393)


(12,393)

Balance, April 30, 2019

53,280,000

$

53,280

$

-

$

(21,800)

$

-

$

(68,094)

$

(36,614)

Shares issued for non-cash consideration


1,150,000


1,150


36,741






-


37,891








-


-





Net loss

-


-


-


-


-


(59,808)


(59,808)

Balance, July 31, 2019

54,430,000

$

54,430

$

36,741

$

(21,800)

$

-

$

(127,902)

$

(58,531)

Shares issued for cash

367,470


367


249,633


-


-


-


250,000

Shares issued for non-cash consideration


150,000


150


58,750






-


58,900








-


-





Net loss

-


-


-


-




(95,789)


(95,789)

  Balance, October 31, 2019

54,947,470

$

54,947

$

345,124

$

(21,800)

$

-

$

(223,691)

$

154,580

 Shares issued for cash

-


-


-


-


-


-


-

Shares issued for non-cash consideration for license acquistions



1,000,000




1,000


799,000






-


800,000






















-


-





Shares issued for non-cash consideration to a senior consultant



100,000


100


104,900






-


105,000






















-


-





Net loss

-


-


-


-


-


(86,661)


(86,661)

Balance, January 31, 2020

56,047,470

$

56,047

$

1,249,024

$

(21,800)

$

-

$

(310,352)

$

972,919

Shares to be issued for non-cash consideration to a senior consultant



-




-




-






-






120,000




-




120,000

Net loss

-


-


-


-


-


(185,131)


(185,131)

Balance, April 30, 2020

56,047,470

$

56,047

$

1,249,024

$

(21,800)

$

120,000

$

(495,484)

$

907,787





 





See accompanying notes, which are an integral part of these financial statements

 

 

 

 

 

6





Venture Vanadium Inc.

STATEMENTS OF CASH FLOWS

Six months ended April 30, 2020 and 2019

(Unaudited)



Six Months Ended April 30,



2020


2019






CASH FLOWS FROM OPERATING ACTIVITIES

Net loss continuing operations

$

               (271,792)

$

-

Stock based compensation


181,250


-

Adjustments to reconcile net loss to net cash (used in) operating activities:





Accounts payable and accrued expenses


15,610


-

CASH FLOWS USED IN OPERATING ACTIVITIES OF CONTINUING OPERATIONS


(74,932)


-

CASH FLOWS USED IN OPERATING ACTIVITIES OF DISCONTINUED OPERATIONS


-







(24,822)

CASH FLOWS USED IN OPERATING ACTIVITIES


(74,932)


(24,822)






CASH FLOWS FROM INVESTING ACTIVITIES





Purchase of Fixed Assets


(105,000)


-

CASH FLOWS PROVIDED/(USED) IN INVESTING ACTIVITIES OF CONTINUING OPERATIONS


(105,000)


-

CASH FLOWS PROVIDED/(USED) IN INVESTING ACTIVITIES OF DISCONTINUED OPERATIONS









8,389

CASH FLOWS PROVIDED/(USED) IN INVESTING ACTIVITIES







(105,000)


8,389






CASH FLOWS FROM FINANCING ACTIVITIES





Related party loans


(5,000)


-

CASH FLOWS PROVIDED/(USED) BY FINANCING ACTIVITIES OF CONTINUING OPERATIONS


(5,000)







-

CASH FLOWS PROVIDED BY FINANCING ACTIVITIES OF DISCONTINUED OPERATIONS


-







10,845

CASH FLOWS PROVIDED/(USED) BY FINANCING ACTIVITIES


(5,000)







10,845






NET DECREASE IN CASH


(184,932)


(5,588)






Cash, beginning of period


184,939


5,719






Cash, end of period

$

7

$

131






SUPPLEMENTAL CASH FLOW INFORMATION:





Interest paid

$

                          -

$

-

Income taxes paid

$

                         -

$

-

NON CASH ACTIVITY:

 

 

 

 

Shares issued as prepaid expenses 

$

43,750

$

-

Shares issued to acquire licences

$

800,000

$

-






 



See accompanying notes, which are an integral part of these financial statements

 

 



7

 

 



Venture Vanadium Inc.

NOTES TO THE FINANCIAL STATEMENTS

April 30, 2020

(UNAUDITED)


Note 1 ORGANIZATION AND NATURE OF BUSINESS


Venture Vanadium Inc. (the Company, we, us or our) was incorporated in the State of Nevada on September 26, 2016. Venture Vanadium Inc. (Formerly Aura Energy Inc.) was previously engaged in the production of wood-manufactured bow ties in China, Hunan Province. This has now ceased. On June 12, 2019, we entered into an assignment agreement with Ian Ilsley to assign his rights and obligations under an option agreement to acquire a 100% interest in over 30 mineral claims (The Desgrobois Vanadium/Titanium Property) representing 1,789.80 hectares (4,422.69 acres) situated in Quebec. On November 22, 2019, Mr. Ilsley, Venture Vanadium Inc. and Mr. Yacoub entered into the Amended and Restated Desgrosbois Option Agreement whereby certain terms of the original agreement were amended.  Under the Amended and Restated Agreement, Mr. Yacoub agreed to transfer the titles in exchange for a $70,000 cash payment, the receipt from the Company of 1,000,000 shares and a two per cent (2.0%) Net Smelter Return on all metals extracted from the property. We now intend to focus on the minerals and resources sector.


The accompanying unaudited interim financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the rules and regulations of the U.S. Securities and Exchange Commission set forth in Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim financial statements furnished reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Unaudited interim results are not necessarily indicative of the results for the full fiscal year. These financial statements should be read in conjunction with our financial statements for the fiscal year ended October 31, 2019 and the notes thereto contained in our Annual Report on Form 10-K.


Note 2 GOING CONCERN


The accompanying financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate continuation of the Company as a going concern. We had no revenues for the six months ended April 30, 2020. We currently have losses and have not completed our efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. Therefore, there is substantial doubt about our ability to continue as a going concern. Management anticipates that we will depend, for the near future, on additional investment capital to fund operating expenses. We intend to raise additional funds through the capital markets. In light of managements efforts, there are no assurances that we will be successful in this or any of our endeavors or become financially viable and continue as a going concern.


Note 3 IMPACT OF COVID-19


With the present COVID-19 pandemic, the Company will need to manage its cash flow during these difficult times and funding resources may not be available as the outlook is uncertain. The Companys plan of operations may not proceed and can be held up due to the impact of COVID-19. These are unprecedented times and the Company will adjust to the new realities and will actively monitor the impact of the pandemic on the Companys business. The full extent of the impact of economic uncertainty on the Companys business operations and financial results will depend on numerous factors that the company may not be able to accurately predict. In an effort to protect the health and safety are employees and consultants a significant amount of time is spent working remotely, international travel has been curtailed and a lot of other functions have been paused. Governments from around the world have enacted various measures to slow the spread and contain COVID-19. These measures include orders to close all business deemed non-essential, isolate residents to their homes and practice social distancing when engaging in essential activities. The Company anticipates that these actions and the global health crisis caused by this pandemic will negatively impact business activity across the globe. It is not clear what the potential effects, if any, that such alterations or modifications we have on our business, financial condition and cash flows. The duration of these measures is also unknown and may be extended with additional imposed measures.

 

 

8

 


Note 4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Basis of presentation

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America. Our year-end is October 31.


Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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 the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.


Recently Issued Accounting Pronouncements

We have reviewed all the recently issued, but not yet effective, accounting pronouncements, and we do not believe any of these pronouncements will have a material impact on us.


The Company adopts new pronouncements relating to generally accepted accounting principles applicable to the Company as they are issued, which may be in advance of their effective date. Management does not believe that any pronouncement not yet effective but recently issued by the FASB (including its Emerging Issues Task Force), the AICPA or the SEC would, if adopted, have a material effect on the accompanying financial statements for the six months to April 30, 2020.


Mineral Properties

The Company will expense mineral property exploration expenditures when incurred.  When it has established that a mineral deposit is commercially mineable and following a decision to commence development, the costs subsequently incurred to develop a mine on the property prior to the start of mining operations are capitalized and will be amortized against production following commencement of commercial production, or written off if the property is sold, allowed to lapse or abandoned. Mineral property acquisition costs are initially capitalized when incurred. Option payments and expenditures required to earn an interest in the properties are capitalized. The Company assesses the carrying costs for impairment. Impairment losses, if any, are measured as the excess of the carrying amount of the mineral property over its estimated fair value. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.


Stock-based compensation

In June 2018, the FASB issued ASU No. 2018-07, "CompensationStock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting", an update that expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. This guidance was adopted by Venture Vanadium Inc for the financial year ended October 31, 2019. There was no material effect on the financial statements as a result of this adoption.


Revenue Recognition 

The Company recognizes revenue in accordance with Accounting Standards Codification 606, Revenue from Contracts with Customers. ASC 606 adoption is on February 1, 2018. The core principle of ASC 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity recognizes revenue in accordance with that core principle by applying the following steps: Step 1: Identify the contract(s) with a customer Step 2: Identify the performance obligations in the contract Step 3: Determine the transaction price Step 4: Allocate the transaction price to the performance obligations in the contract Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Specifically, Section 606-10-50 requires an entity to provide information about: a. Revenue recognized from contracts with customers, including the disaggregation of revenue into appropriate categories; b. Contract balances, including the opening and closing balances of receivables, contract assets, and contract liabilities; c. Performance obligations, including when the entity typically satisfies its performance obligations and the transaction price that is allocated to the remaining performance obligations in a contract; d. Significant judgments, and changes in judgments, made in applying the requirements to those contracts.


Note 5 RELATED PARTY LOANS


Related Party Loans are not covered by a formal loan agreement and are interest free with no fixed repayment date. They are due to Ian Ilsley, the companys sole director and controlling shareholder, and were made following the change of control on May 29, 2019.


Note 6 SUBSEQUENT EVENTS




9



In accordance with SFAS 165 (ASC 855-10), we have analyzed our operations subsequent to April 30, 2020 to the date these financial statements were issued and have determined that we do not have any material subsequent events to disclose in these financial statements.



Note 7 MINERAL PROPERTIES


On June 12, 2019, we entered into an assignment agreement with Ian Ilsley to assign his rights and obligations under an option agreement to acquire exploration rights over 30 mineral claims (The Desgrobois Vanadium/Titanium Property) representing 1,789.80 hectares (4,422.69 acres) situated in Quebec.


Under the terms of the assignment agreement, we issued 50,000 shares to Ian Ilsley on June 21, 2019 and a further 50,000 shares ninety days thereafter in consideration for him having entered into the assignment agreement.


Under the terms of the option agreement, payments totaling $65,000 were made to the Optionor and 1,150,000 shares were issued to the Optionor. On November 22, 2019, Mr. Ilsley, Venture Vanadium Inc. and Mr. Yacoub entered into the Amended and Restated Desgrosbois Option Agreement whereby certain terms of the original agreement were amended.  Under the Amended and Restated Agreement, Mr. Yacoub agreed to transfer the titles in exchange for a $70,000 cash payment, the receipt from the Company of 1,000,000 shares and a two per cent (2.0%) Net Smelter Return on all metals extracted from the property. These transactions are reflected in the accounts as of April 30, 2020 and have been capitalized in accordance with the companys accounting policy noted in note 3 above.


Note 8  DISCONTINUED OPERATIONS


Further to the company entering into the Split-Off Agreement dated May 29, 2019, pursuant to current accounting guidelines, the business component relating to the assets and liabilities taken over is reported as a discontinued operations. 


Note 9  INCOME/(LOSS) PER SHARE


Basic income (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted income (loss) per share reflects the potential dilution, using the treasury stock method that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the income (loss) of the Company. In computing diluted income (loss) per share, the treasury stock method assumes that outstanding options and warrants are exercised and the proceeds are used to purchase common stock at the average market price during the period. Options and warrants may have a dilutive effect under the treasury stock method only when the average market price of the common stock during the period exceeds the exercise price of the options and warrants. As of April 30, 2020 and 2019, there were no outstanding warrants or options.

 

The following table sets forth the computation of basic and diluted earnings per share:

 

 

 

 

For the six months ended  
April 30,

 

 

2020

 

 

2019

Earnings per share  Basic and Diluted

 

 

 

 

 

 

 

Income (Loss) for the period

 

$

(271,792)

 

 

$

(17,213)

Basic average common stock outstanding - Basic and Diluted

 

 

55,782,745

 

 

 

53,280,000

Net earnings per share  Basic and Diluted

 

$

(0.00)

 

 

$

(0.00)


Note 10 - RECENT SALES OF UNREGISTERED SECURITIES

 

We have 75,000,000, $0.001 par value shares of common stock authorized.

 

In June 2019, we issued 1,100,000 shares of common stock at $0.05 per share to the Optionor under the terms of the option agreement to acquire exploration rights over 30 mineral claims (The Desgrosbois Property) as modified.

 



10



In June 2019, we issued 50,000 shares of common stock at $0.05 per share to a director under the terms of the assignment of the option agreement to acquire exploration rights over 30 mineral claims (The Desgrosbois Property).

 

In October 2019, we issued 162,272 shares of common stock for cash proceeds of $100,000 at approximately $0.61625 per share.

 

In October 2019, we issued 205,198 shares of common stock for cash proceeds of $150,000 at approximately $0.731 per share.

 

In October 2019, we issued 100,000 shares of common stock at $0.01 to a senior geologist under the terms of his consultancy agreement entered into on January 1, 2019 with us.

 

In October 2019, we issued 50,000 shares of common stock at $0.05 to a director under the terms of the assignment of the option agreement to acquire exploration rights over 30 mineral claims (The Desgrosbois Property).

 

In November 2019, we issued 1,000,000 shares of common stock in connection with the acquisition of the titles in the Desgrosbois Property.

 

In January 2020 we issued 100,000 shares to pursuant to a consulting agreement. The shares were initially valued at $105,000 with $61,250 being recognized as work program and technical expense, with the remaining $43,750 to be recognized as expense over the remaining term of the agreement.


In January 2020 we were due to issue a further 150,000 shares to a senior geologist under the terms of his consultancy agreement entered into on January 1, 2019 with us. These shares have not yet been issued, but instead are recorded as shares to be issued at a value of $120,000.


ITEM 2.

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS


You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this report. Some of the information contained in this discussion and analysis or set forth elsewhere in this report includes forward-looking statements that involve risks and uncertainties. You should review the Risk Factors section of our Annual Report for the year ended October 31, 2019 for a discussion of some of the important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.


Forward looking statement notice


Statements made in this Form 10-Q that are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. 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 judgment 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.


Financial information contained in this quarterly report and in our unaudited interim financial statements is stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.


Corporate History


Venture Vanadium Inc., formerly known as Aura Energy Inc. and as Arcom (the Company), was incorporated under the laws of the State of Nevada on September 26, 2016. Venture Vanadium Inc. has only one officer and director who is Ian Ilsley. We were engaged in the production of wood-manufactured bow ties in China, Hunan Province. This activity has now ceased. On June 12, 2019, we entered into an assignment agreement with Ian Ilsley to assign his rights and obligations under an option agreement to acquire exploration rights over 30 mineral claims (The Desgrobois Vanadium/Titanium Property) representing 1,789.80 hectares (4,422.69 acres) situated in Quebec.

 

 

 

11

 

 


Under the terms of the assignment agreement, we issued 50,000 shares to Ian Ilsley on June 21, 2019 and a further 50,000 shares ninety days thereafter in consideration for him having entered into the assignment agreement.


Under the terms of the option agreement, payments totaling $65,000 were made to the Optionor and 1,150,000 shares were issued to the Optionor. On November 22, 2019, Mr. Ilsley, Venture Vanadium Inc. and Mr. Yacoub entered into the Amended and Restated Desgrosbois Option Agreement whereby certain terms of the original agreement were amended.  Under the Amended and Restated Agreement, Mr. Yacoub agreed to transfer the titles in exchange for a $70,000 cash payment, the receipt from the Company of 1,000,000 shares and a two per cent (2.0%) Net Smelter Return on all metals extracted from the property. These transactions are reflected in the accounts to April 30, 2020.


Research and Development Expenditures


We have not incurred any research expenditures since our incorporation.

  

Bankruptcy or Similar Proceedings

  

There has been no bankruptcy, receivership or similar proceeding entered into either voluntarily by us and involuntarily against us.

  

Reorganizations, Purchase or Sale of Assets

  

On February 1, 2019, we filed a Certificate of Change with the Secretary of State of Nevada to effect a 12-for-1 forward split which increased the number of outstanding shares of common stock from 4,440,000 to 53,280,000.  Unless otherwise noted, all share amounts provided in this report reflect such reverse stock split.


Our assets comprise a 100% interest in over 30 mineral claims (The Desgrobois Vanadium/Titanium Property) representing 1,789.80 hectares (4,422.69 acres) situated in Quebec.

  

Compliance with Government Regulation

  

We will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to the construction and operation of any facility in any jurisdiction which we would conduct activities.


Employees and Employment Agreements

  

We have no employees, except our sole officer and director Ian Ilsley, as of the date of this report. We have no employment agreement with Mr. Ilsley. Our sole officer and director, Ian Ilsley, currently devotes approximately 30 hours per week to company matters. As our business and operations increase, we will assess the need for full-time management and administrative support personnel.

  

Legal Proceedings

  

There are no pending legal proceedings to which we are a party or in which any of our directors, officers or affiliates (any owners of record or beneficially of more than 5% of any class of our voting securities) is a party adverse to us or has a material interest adverse to us.


Results of Operations


We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.


We expect we will require additional capital to meet our long-term operating requirements. We expect to raise additional capital through, among other avenues, the sale of equity or debt securities.


Revenue and cost of goods sold


For the six months ended April 30, 2020, we reported no revenue.


Operating expenses


Total operating expenses for the three-month period ended April 30, 2020, were $185,131 and the total operating expenses for the three-month period ended April 30, 2019, all of which related to discontinued activities, were $12,393, making the total operating expenses for the six months to April 30, 2020 and 2019 $271,792 and $29,607 respectively. The operating expenses for the six-month period ended April, 2020 included audit fees of $7,775; legal & professional fees of $18,000; rent expense of $4,217; regulatory filing fees of $5,622; directors fees of $30,000; geologists and other technical fees of $187,250; travel, entertaining and subsistence of $6,285; web services and news releases of $5,500 and sundry general and administrative expenses of $7,143. The increase in expenditure reflects the increased activity by the company due to its new operations, its exploration activities and the strengthening of the management team.


Net Loss


The net loss for the three-month period ended April 30, 2020, was $185,131 and the net loss for the three-month period ended April 30, 2019, all of which related to discontinued activities, was $12,393. The net loss for the six-month period ended April 30, 2020, was $271,792 compared to a net loss for the six-month period ended April 30, 2019, all of which related to discontinued activities, of $29,607.


Liquidity and Capital Resources


As of April 30, 2020, our total assets were $1,073,807 compared to $309,989 as of October 31, 2019; the increase resulting from the acquisition of the title to the 30 Desgrosbois Proerty claims which were previously under option to the company.


As of April 30, 2020, our current liabilities were $166,020 and Stockholders Equity was $907,787.


CASH FLOWS FROM OPERATING ACTIVITIES


For the six-month period ended April 30, 2020, net cash flows used in operating activities was negative $74,932, compared with negative $24,822 for the six-month period ended April 30, 2019. The cash flows used in operating activities for the six-month period ended April, 2019 related entirely to discontinued operations. The increase in cash flows used in the six-month period ended April, 2020 reflects the increased activity by the company due to its new operations, its exploration activities and the strengthening of the management team.


CASH FLOWS FROM INVESTING ACTIVITIES


For the six-month period ended April 30, 2020, we used $105,000 of cash in investing activities which related to the acquisition of the title to the 30 Desgrosbois Proerty claims which were previously under option to the company. This compares with cash inflows from investing activities in the corresponding period ending April 30, 2019 of $8,389 which related to the disposal of assets used in discontinued activities.


CASH FLOWS FROM FINANCING ACTIVITIES


For the six-month period ended April 30, 2020, we used $5,000 of cash in financing activities, compared to inflows of $10,845 for the six-month period ended April 30, 2019. These were in connection with changes in related party loans in both periods.


Emerging Growth Company


We qualify as an emerging growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:

  

·      

Have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;

·        

Provide an auditor attestation with respect to managements report on the effectiveness of our internal controls over financial reporting;



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·        

Comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditors report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);

·        

Submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and

·        

Disclose certain executive compensation related items such as the correlation between executive compensation and performance comparisons of the CEOs compensation to median employee compensation.

  

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.

  

We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period. However, even if we no longer qualify for the exemptions for an emerging growth company, we may still be, in certain circumstances, subject to scaled disclosure requirements as a smaller reporting company. For example, smaller reporting companies, like emerging growth companies, are not required to provide a compensation discussion and analysis under Item 402(b) of Regulation S-K or the auditor attestation of internal controls over financial reporting.


Our independent registered public accountant has issued a going concern opinion for our fiscal year ended October 31, 2019, and we anticipate that they will issue another going concern opinion in connection with this fiscal year. This means that there is doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills.

  

Off-Balance Sheet Arrangements

  

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

  

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


Not applicable.


ITEM 4. CONTROLS AND PROCEDURES


Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commissions rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuers management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.


An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of April 30, 2020. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms.




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Changes in Internal Controls over Financial Reporting


There was no change in our internal control over financial reporting during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.



PART II.  OTHER INFORMATION


ITEM 1.

LEGAL PROCEEDINGS


We are not a party to any material legal proceedings.


There are no pending legal proceedings to which we are a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company.


ITEM 1A.

RISK FACTORS


Not applicable.


ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS


None.


ITEM 3.

DEFAULTS UPON SENIOR SECURITIES


None


ITEM 4.

MINE SAFETY DISCLOSURE


Not applicable


ITEM 5.

OTHER INFORMATION


None.


ITEM 6.

EXHIBITS

The following exhibits are included as part of this report by reference:




31.1 

 

Certification of Principal Executive Officer and Principal Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).




32.1 

 

ExchangeCertifications pursuant to Securities  Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.








SIGNATURES

  

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized on June 9, 2020.

  

  

Venture Vanadium Inc.

  

  

  

  

By:

/s/

Ian Ilsley

  

  

  

Name:

Ian Ilsley

  

  

  

Title:

President, Treasurer, Secretary and Director

  

  

  

(Principal Executive, Financial and Accounting Officer)

  




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