UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month ofAugust, 2004
Commission File Number000-50112
Pan American Gold Corporation
(Translation of registrant's name into English)
Suite 601 - 750 West Pender Street, Vancouver, British Columbia V6C 2T7
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or
Form 40-F. Form 20-F [X] Form 40-F [ ]
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1) [ ]
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7) [ ]
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes [ ] No [X]
If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
82 - [ ]
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PAN AMERICAN GOLD CORPORATION
(formerly TRI-LATERAL VENTURE CORPORATION)
INTERIM FINANCIAL STATEMENTS
June 30, 2004
(Unaudited)
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PAN AMERICAN GOLD CORPORATION
(formerly TRI-LATERAL VENTURE CORPORATION)
INTERIM BALANCE SHEET
June 30, 2004 and December 31, 2003
(Unaudited)
(Unaudited) | (Audited) | |
ASSETS | ||
Current | $ 136,070 | $ 2,729 |
GST receivable | 6,657 | 1,970 |
Other Receivables | 139 | |
__________ | __________ | |
142,866 | 4,699 | |
Reclamation Bonds | 28,463 | - |
Other assets | 1,790 | - |
Resource properties (Note 5) | 379,582 | 12,775 |
Partnership Interest (Note 4) | 2,926,910 | |
__________ | __________ | |
$ 3,479,611 | $ 17,474 | |
LIABILITIES | ||
Current | ||
Accounts payable - Note 6 | $ 14,268 | $ 56,078 |
Loans payable | 43,600 | 50,408 |
Loan Payable Partnership Interest | 2,855,764 | |
__________ | __________ | |
2,913,632 | 106,486 | |
SHAREHOLDERS' DEFICIENCY | ||
Share capital - Note 6 | 7,411,649 | 6,769,726 |
Contributed surplus | 53,418 | 2,000 |
Deficit | (6,899,088) | (6,860,738) |
__________ | __________ | |
565,979 | (89,012) | |
__________ | __________ | |
$ 3,479,610 | $ 17,474 | |
_______________ | _______________ |
SEE ACCOMPANYING NOTES
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PAN AMERICAN GOLD CORPORATION
(formerly TRI-LATERAL VENTURE CORPORATION)
INTERIM STATEMENTS OF LOSS AND DEFICIT
for the three and six months ended June 30, 2004 and 2003
(Unaudited)
Three months | Six months | |||
2004 | 2003 | 2004 | 2003 | |
Expenses | ||||
Accounting fees | $15,817 | $3,850 | $17,017 | $6,375 |
Advertising and promotion | 856 | - | 856 | - |
Amortization | 471 | - | 471 | - |
Bank charges and interest | 589 | 58 | 837 | 8,494 |
Consulting fees | 19,167 | 7,698 | 26,667 | 12,173 |
Filing fees and shareholder communications | 4,837 | - | 7,924 | - |
Legal fees | 25,620 | 16,164 | 28,786 | 16,725 |
Office and miscellaneous | 5,350 | 9,933 | 5,350 | 10,986 |
Rent | - | 1,500 | 1,500 | 3,000 |
Stock based compensation - Note 6 | 51,487 | - | 51,487 | - |
Telecommunications | 1,640 | - | 1,640 | - |
Transfer agent | 992 | - | 3,819 | - |
Travel | 3,849 | 1,674 | 3,849 | 3,794 |
__________ | __________ | __________ | __________ | |
Loss before other items | 130,675 | 40,877 | 150,203 | 61,547 |
Other items | ||||
Foreign Exchange | 10,862 | - | 10,862 | - |
Interest (income) expense | 81,686 | - | 81,686 | 11 |
Partnership (income) expense | (204,402) | (204,402) | ||
__________ | __________ | __________ | __________ | |
Net loss for the period | (18,821) | (40,877) | (38,349) | (61,558) |
Deficit, beginning of the period | (6,880,267) | (6,777,022) | (6,860,739) | (6,756,363) |
__________ | __________ | __________ | __________ | |
Deficit, end of the period | (6,899,088) | (6,817,899) | (6,899,088) | (6,817,899) |
__________ | __________ | __________ | __________ | |
Basic and diluted loss per share | (0.00) | (0.01) | (0.00) | (0.01) |
__________ | __________ | __________ | __________ | |
Weighted Average Shares | 32,399,528 | 31,455,187 | ||
_______________ | _______________ | _______________ | _______________ |
SEE ACCOMPANYING NOTES
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PAN AMERICAN GOLD CORPORATION
(formerly TRI-LATERAL VENTURE CORPORATION)
INTERIM STATEMENTS OF CASH FLOWS
for the three and six months ended June 30, 2004 and 2003(Unaudited)
Three months ended June 30, | Six months ended June 30, | ||||
2004 | 2003 | 2004 | 2003 | ||
Operating Activities | |||||
Net loss for the period | (18,821) | (40,877) | (38,349) | (61,536) | |
Deduct item not affecting cash: | |||||
Partnership income | (71,146) | - | (71,146) | - | |
Stock based compensation | 51,487 | - | 51,487 | - | |
Changes in non-cash working capital | |||||
items related to operations: | |||||
GST receivable | (3,344) | (259) | (4,687) | (418) | |
Other Receivable | 3,254 | - | 3,254 | - | |
Accounts payable | (78,194) | 13,252 | (63,941) | 21,679 | |
Loans payable | 809 | 28,500 | 4,809 | 28,500 | |
___________ | ___________ | __________ | ___________ | ||
(115,955) | 616 | (118,573) | (11,775) | ||
Investing Activities | |||||
Increase in resource property | (50,599) | (524) | (50,599) | (524) | |
Increase in reclamation bonds | (19,679) | - | (19,679) | - | |
Cash from business acquisition | 322,191 | - | 322,191 | - | |
___________ | ___________ | __________ | ___________ | ||
251,914 | (524) | 251,914 | (524) | ||
Increase (Decrease) in Cash | 135,959 | 92 | 133,341 | (12,299) | |
Cash, beginning of period | 111 | 993 | 2,729 | 13,384 | |
___________ | ___________ | __________ | ___________ | ||
Cash, end of period | 136,070 | 1,085 | 136,070 | 1,085 | |
Supplemental disclosure of cash flow information: | |||||
Cash paid for interest | $ - | $ - | $ - | $ - | |
Cash paid for income taxes | $ - | $ - | $ - | $ - | |
_______________ | _______________ | _______________ | _______________ |
Non-cash Transactions - Note 8
SEE ACCOMPANYING NOTES
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PAN AMERICAN GOLD CORPORATION
(formerly TRI-LATERAL VENTURE CORPORATION)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
June 30, 2004
(Unaudited)
Note 1Interim Reporting
While the information presented in the accompanying six month financial statements is unaudited, it includes all adjustments, which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented. These interim financial statements follow the same accounting policies and methods in their application as the Company's annual financial statements. It is suggested that these interim financial statements be read in conjunction with the Company's audited annual December 31, 2003 financial statements.
Note 2Acquisition of Pan American Gold - Nevada
On May 10 2004 the Company acquired 100% of the outstanding shares of Pan American Gold Corporation , a Nevada Company. The Company issued 3,370,000 shares valued at $641,923 as consideration.
The purchase price was allocated as follows:
Cash | 322,191 |
Mineral properties | 316,208 |
Accounts receivable | 15,081 |
Other asset | 10,574 |
Liabilities assumed | (22,132) |
__________ | |
Total | 641,923 |
Note 3Investment in Limited Partnerships
During the Quarter ended June 30, 2004, the Company entered into an agreement to purchase an interest in a limited partnership (the "Partnership") which effectively enabled it to utilize its tax losses against income earned for its Partnership interest.
At June 30 2004, the Company recorded $204,402 received from the partnership as other income and interest expense related thereto amounting to $81,689.
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PAN AMERICAN GOLD CORPORATION
Formerly Tri-Lateral Venture Corporation
Notes to the Interim Financial Statements
June 30, 2004
(Unaudited) - Page 2
Note 4Resource Properties
Schedule of Exploration Expenses | ||||
6 months ended | ||||
Eskay Creek, British Columbia | ||||
Acquisition | 79,749 | |||
Geology & Engineering Fees | ||||
Maps and Copies | ||||
__________ | ||||
Total | 79,749 | |||
Pinnacle, Nevada | ||||
Acquisition | 38,104 | |||
Geology | 7,857 | |||
Assay Costs | 1,589 | |||
__________ | ||||
Total | 47,550 | |||
Kinsley Mtn, Nevada | ||||
Acquisition | 138,560 | |||
Geology & Engineering Fees | 6,493 | |||
Field Costs | ||||
__________ | ||||
Total | 145,053 | |||
Cactus, California | ||||
Acquisition | 59,795 | |||
Geology & Engineering Fees | 4,726 | |||
Drilling | 17,392 | |||
Licences & permits | 547 | |||
__________ | ||||
Total | 82,460 | |||
Lennie, Ontario | ||||
Acquisition | - | |||
Exploration | 12,775 | |||
__________ | ||||
12,775 | ||||
General | ||||
Geology & Engineering Fees | 11,996 | |||
__________ | ||||
11,996 | ||||
__________ | ||||
Total | $379,582 | |||
__________ |
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PAN AMERICAN GOLD CORPORATION
Formerly Tri-Lateral Venture Corporation
Notes to the Interim Financial Statements
June 30, 2004
(Unaudited) - Page 3
Note 5Share Capital
Authorized
Unlimited common shares
Unlimited non-voting convertible redeemable non-cumulative 6% preference shares
Issued Common Shares | Number | $ |
Balance, December 31, 2003 | 4,358,521 | 6,769,726 |
Share split 7:1 on May 4,2004 | 26,152,326 | - |
_____________ | _____________ | |
30,510,847 | 6,769,726 | |
Issued to acquire Pan American Nevada (Note 2) | 3,370,000 | 641,923 |
_____________ | _____________ | |
Balance, June 30, 2004 | 33,380,847 | 7,411,649 |
_____________ | _____________ |
Options
The Company issued on May 7 2004 options to acquire 1,300,000 common shares at a price of $0.02 per share. The Options have been valued at $ 0.19 an aggregate of $251,000 using the Black Scholes model under the following assumptions outlined in thew table below:$ 251,000 is being expensed over the vesting periods which are 12 months for 1,000,000 options and 6 months for 300,000 options.
Risk Free Rate | 3.0 % |
Volatility | NIL |
Expiry date | May 7, 2009 |
Number | 1,300,000 |
Vesting | 133,333 per month May 2004 to Oct 2004 |
83,333 per month November 2004 to May 2005 |
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PAN AMERICAN GOLD CORPORATION
Formerly Tri-Lateral Venture Corporation
Notes to the Interim Financial Statements
June 30, 2004
(Unaudited) - Page 4
Note 6Segmented information
The Company's operations fall into industry segment, the exploitation of resource properties currently operates geographically in two areas Canada and the United States. Total assets by geographic segment are as follows:
June 30, | December 31 , | ||||
2004 | 2003 | 2003 | 2002 | ||
Canada | $ 3,192,553 | $ 15,590 | $ 17,474 | $ 26,947 | |
United States | 287,058 | - | - | - | |
3,479,611 | 15,590 | 17,474 | 26,947 | ||
- | - | - |
Note 7Related Party Transactions
During the three and six months ended June 30, 2004 the Company incurred the following expenses with directors and/or companies controlled by directors :
Three months ended June 30, | Six months ended June 30, | ||||
2004 | 2003 | 2004 | 2003 | ||
Accounting fees | $ 3,561 | $ 1,400 | $ 4,761 | $ 3,925 | |
Consulting fees | 24,779 | 7,698 | 32,279 | 12,173 | |
Interest expense | - | - | - | 4,167 | |
Rent | - | 1,500 | 1,500 | 3,000 | |
_____________ | _____________ | _____________ | _____________ | ||
$ 28,340 | $ 10,598 | $ 38,540 | $ 23,265 |
The expenses were measured by the exchange amount, which is the amount agreed upon by the transacting parties and are on terms and conditions similar to non-related entities.
As at June 30, 2004, accounts payable includes $ 3,000 ( 2003-$8,393) owing to a company controlled by a director (2003- a company with a common director) and $ 2,461 owing to a firm where a former director is a partner.
Note 8Non-cash Transactions
Investing and financing activities that do not have a direct impact on current cash flows are excluded from the statements of cash flows. During the six months ended June 30,2003, the Company settled accounts payable totalling $261,043 and loans payable totalling $725,424 by issuing 986,467 common shares valued at $986,467. This transaction was excluded from the statements of cash flows.
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PAN AMERICAN GOLD CORPORATION
Formerly Tri-Lateral Venture Corporation
Notes to the Interim Financial Statements
June 30, 2004
(Unaudited) - Page 5
During the six months ended June 30 2004the Company acquired 100% of the outstanding shares of Pan American Gold Corporation , Nevada Company by issuing 3,370,000 shares (see Note 2)
Note 9Subsequent Events
Subsequent to the date of the financial statements:
a) The Company entered into an agreement whereby the Company in exchange for payments totalling US $25,000 ($US 9,000 paid) for a 4 month option on mineral properties located in Chile. If the Company elects to exercise the option a further payment of US 100,000 will have to be made.
b) 166,666 options were exercised
c) The Company commenced efforts to place 750,000 common shares at US$ 1.00 per share, by way of private placement as of the current date the company had received $250,000 of this amount.
Note 10Canadian and United States of America Accounting Principles
The financial statements have been prepared in accordance with accounting principles generally accepted in Canada, which differ in certain respects with those principles and practices that the Company would have followed had its financial statements been prepared in accordance with accounting principles generally accepted in the United States of America.
The Company's accounting principles generally accepted in Canada ("Canadian GAAP") differ from accounting principles generally accepted in the United States ("US GAAP") as follows:
Resource Properties
Under Canadian GAAP, resource property acquisition costs and exploration costs may be deferred and amortized to the extent they meet certain criteria. Under US GAAP, acquisition costs and exploration costs must be expensed as incurred unless the resource properties have proven reserves. During the six months ended June 30, 2004, $366,827 (2003- $ 524) was incurred in resource property costs. Therefore, an additional expense is required under US GAAP.
Under Canadian GAAP investments in Joint Ventures are accounted for using proportionate consolidation, Under United States GAAP these investments are accounted for by the equity method of accounting. There is no impact on earnings from this difference.
The Company follows the fair value method of accounting for stock based compensation, therefore there is no reporting difference.
The impact of the above on the financial statements is as follows:
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PAN AMERICAN GOLD CORPORATION
Formerly Tri-Lateral Venture Corporation
Notes to the Interim Financial Statements
June 30, 2004
(Unaudited) - Page 6
June 30, | ||||
2004 | 2003 | |||
Net loss for the period per Canadian GAAP | $ ( 131,217) | $ (61,536) | ||
Deferred exploration costs | ( 366,827) | (524) | ||
_____________ | _____________ | |||
Net loss for the period per US GAAP | ( 498,044) | $ (62,060) | ||
_____________ | _____________ | |||
June 30, | December 31, | |||
Total assets per Canadian GAAP | 552,701 | $ 17,474 | ||
Acquisition and deferred exploration costs | ( 379,582) | (12,775) | ||
_____________ | _____________ | |||
Total assets per US GAAP | $ 173,119 | $ 4,699 | ||
_____________ | _____________ | |||
Shareholders' Deficiency | ||||
Balance, end of the period as per Canadian GAAP | $(6,970,234) | $ ( 89.012) | ||
Acquisition and deferred exploration costs | ( 379,582) | (12,775) | ||
_____________ | _____________ | |||
Balance, end of period per US GAAP | $( 7,345,816) | $ (101,787) | ||
_____________ | _____________ |
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PAN AMERICAN GOLD CORPORATION
(formerly Tri Lateral Venture Corporation)
QUARTERLY REPORT
for the Quarter ended June 30, 2004
MANAGEMENT DISCUSSION AND ANALYSIS
1.1 Date of Report: August 30, 2004
1.2 Overall Performance
Nature of Business and Overall Performance
The company was incorporated under the laws of the Province of Ontario (specifically under theOntario Business Corporations Act) in on April 24, 1967 under the name "Jolly Jumper Products of America Limited". On September 25, 1987, the name was changed to Sun Valley Hot Springs Ranch Inc. The name changed to Tri-Valley Free Trade Inc. on March 26, 1991 and to Tri-Valley Investments Corporation on June 19, 1995. On October 2, 1998 the name changed to Tri-Lateral Venture Corporation and on May 6, 2004 the name changed to our present legal and commercial name "Pan American Gold Corporation". We are a reporting issuer under the securities laws of the Province of Ontario.
The Company's shares began trading on the OTC BB on April 19, 2004.
On May 6, 2004, the issued and unissued shares of common stock was split on the basis of seven (7) common shares for each one (1) common share and our name was changed to Pan American Gold Corporation. The forward split and name change were not affected with the OTC Bulletin Board until June 2, 2004 at which time our trading symbol was changed to "PNAMF".
Present Operations
We are in the business of acquiring, exploring and developing (when appropriate) natural resource properties. Our primary property prior to the acquisition of Pan American Nevada has been the Lennie property, a gold exploration project located in the Red Lake gold camp in Ontario.
The Company does not have defined mineral resources or reserves on any of its five exploration properties. Of the properties that the Company controls, two are previously gold producers, two others have some drilling with gold mineralization defined, and one is early stage. Mineral exploration involves a high degree of risk. Discovering new mineral deposits is dependent on a number of factors including the experience of exploration personnel involved, the location of the property, and most important - stable funding of exploration programs. The commercial viability of a mineral deposit once discovered is also dependent on a number of factors including country of location, size, grade, and proximity to infrastructure, as well as metal prices. The prices of most metals, including gold, have increased significantly over the past year, improving the probability of successful that a new discovery will be economic, as well as the improving the access to capital to finance on-going activities.
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PAN AMERICAN GOLD CORPORATION
(formerly Tri Lateral Venture Corporation)
QUARTERLY REPORT
for the Quarter ended June 30, 2004 Page 2
Business Acquisition and Financing
On May 6, 2004, we entered into a share purchase agreement with Pan American Gold Corporation, a Nevada corporation ("Pan American Nevada"), J. Graham Douglas and the shareholders of Pan American Nevada, whereby we acquired Pan American Nevada in consideration for the issue of an aggregate of 3,370,000 shares of common stock of our company.
Pan American Nevada holds interests in four gold exploration projects in North America.
In British Columbia, Pan American Nevada holds a 75% interest in an 80,000 acre properties position comprised of 87 mineral claims in the Eskay Creek gold camp area.
In Nevada, Pan American Nevada holds an option to acquire a 60 % interest in the Kinsley Mountain Property, a past gold producer. The Kinsley Mountain Property is described as follows:
The property is located in Elko County, Nevada. It is comprised of approximately 125 claims covering approximately 2,600 acres. The detailed location of claims is given in the table below:
Township | Range | Sections |
27 North | 67 East | 36 |
27 North | 68 East | 31 & 32 |
26 North | 67 East | 01, 12 & 13 |
26 North | 68 East | 05, 06, 07 & 08 |
Pan American Nevada holds an option to acquire a 60% interest in the Pinnacle Property which was previously drilled by Homestake Mining Company. Pinnacle Property described as follows:
The property is located in Nye County, Nevada. It is comprised of approximately 80 claims covering approximately 1,600 acres over the known mineralization in the area. All the claims are situated in Township 14 North, Range 40 East, Sections 09, 10, 15, 16, 17, 19, 20, 21, 29 & 30 of the Mount Diablo Base & meridian (MDB&M).
Pan American Nevada also holds a 50% interest in Cactus Minerals, a private Colorado Company which owns the Cactus property. The Cactus property is located in the western Mojave Desert in Kern County, California. The Cactus property, held previously by CoCa Mines and Hecla Mining Co., was first mined in 1894. Total historic production is approximately 400,000 ounces of gold and a million ounces of silver.
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PAN AMERICAN GOLD CORPORATION
(formerly Tri Lateral Venture Corporation)
QUARTERLY REPORT
for the Quarter ended June 30, 2004 Page 3
As a condition to the closing under the share purchase agreement, our board of directors appointed Richard Bachman as a member of our board of directors, and Kevin Hanson and Alan Crawford resigned as directors and officers of our company. On May 7, 2004 Michael Sweatman was appointed as a director of our company.
The Company is planning a private placement in the amount of $ 750,000 To date the Company has received by way of non interest bearing advances $ 250,000 in respect of the placement
1.3 Not Required in Interim Report
1.4 Results of Operations
Operations during the year ended December 31, 2004 were primarily related to the restructuring of the Company and the acquisition of Pan American Gold Corporation (Nevada).
A significant non cash expense related to stock based compensation arose from the granting of options on May 7 in the current quarter as opposed to nil in the previous year.
At June 30, 2004, the Company had total working capital of $85,000 and subsequent to the financial statement date received $332,500 (US$ 250,000) and expects that this will provide adequate funds to carry out the proposed activities discussed in Nature of Business above. The Company will require additional capital which if not raised could require curtailment of activities in the future.
Cash used in operations increased to $115,885 for the quarter ended June 30 2004 whereas the prior year cash of $ 616 was generated from operations, the increased cash use was attributable to a number of factors including an increase in legal fees increasing from $16,164 to $25,620 from and accounting fees which increased from $3,850 to $15,817 these increases were associated with the acquisition of Pan American Gold Corporation (Nevada) and the regulatory filings associated therewith. Additionally, payment of accounts payable accounted for a significant use of cash. The acquisition of limited partnership interests contributed $51,567 to operations which was not owned in the prior year.
Similarly with the activity acquiring Pan American Nevada the increases were significant over the immediately preceding quarter and year to date results for the 6 months ended June 30, 2004.
The increases in investing activity and capitalized exploration are expected to show increases in the future. Some seasonal variations are expected as weather is a factor particularly on the Eskay Creek property, the acquisition of the Chilean property may serve to eliminate some of the seasonality.
The Pan American acquisition and the cash balance associated therewith was a significant cash contribution in the period.
-15-
PAN AMERICAN GOLD CORPORATION
(formerly Tri Lateral Venture Corporation)
QUARTERLY REPORT
for the Quarter ended June 30, 2004 Page 4
As a consequence of the Pan American acquisition investing activities increased as acquisition and exploration of the properties continued. The previous year saw limited activity only on the Lennie property in Ontario.
Exploration Activities in 2004
During the quarter and to date the Company has focussed on exploration of the Cactus, Kinsley Mountain and Pinnacle properties.
Limited drilling on the Cactus property was conducted during June 2004 and yielded low grade gold mineralization the context of which is currently being evaluated. The Company is considering a follow-up magnetic survey over the district to evaluate the global exploration potential.
The Kinsley Mountain exploration program has focussed on permitting a multi-phase drilling program. During the period the Company completed a new Magnetic and VLF geophysical survey of the project area that resulted in staking of an additional 30 unpatented mining claims comprising 600 acres and the identification of new drill targets. During the period US$45,000 of a drill reclamation bonds were posted with United States Bureau of Land Management in preparation of the drill program. The Company anticipates that drilling will commence at Kinsley during September 2004.
The Company completed a new Magnetic geophysical survey on the property to aid in the targeting of new drill holes. The Pinnacle property is located on land administrated by the United States Forest Service where Company has completed a number of required baseline environmental surveys in preparation for drilling. The Company anticipates the drilling will start in late September 2004 in sequence with the Kinsley drill program.
An integrated DIGHEM EM / Magnetic/Radiometric Geophysical survey is planned for late August and early September on the Eskay Creek property. The Budget is approximately $160,000 Canadian and is expected to involve 1,900 line kilometres. There are indications that due to the early onset of poor weather and snow cover that there is a possibility that this work could be delayed until next year's field season. The remoteness and geographic location of the project area contribute to a very short exploration season in Eskay-Iskut region.
The acquisition of the mineral properties in Chile is under consideration. The Company continues to screen opportunities that have the potential to add value to our business.
1.5 Summary of Quarterly Results
The following is a summary of the Company's financial results for the eight most recently completed quarters:
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PAN AMERICAN GOLD CORPORATION
(formerly Tri Lateral Venture Corporation)
QUARTERLY REPORT
for the Quarter ended June 30, 2004 Page 5
Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | |||
Total revenues | $ - | $ - | $ - | $ - | $ - | $ - | $ - | $ - | ||
Net loss before discontinued operations and extraordinary items: | ||||||||||
Total | $(89,969) | $(19,528) | $ (24,203) | $ (18,649) | (40,877) | (20,670) | $(521,112) | $ (45,939) | ||
Per share | $(0.00) | $(0.00) | $(0.01) | $ ( 0.00) | $(0.01) | $( 0.01) | $ (0.16) | $ ( 0.01) | ||
Per share, fully diluted |
|
|
|
|
|
|
|
| ||
Net Loss | ||||||||||
Total | $(89,969) | $(19,528) | $ (24,203) | $ (18,635) | (40,877) | (20,659) | $(521,112) | $ (45,853) | ||
Per share | $(0.00) | $(0.00) | $(0.01) | $ (0.00) | $(0.01) | $(0.01) | $ (0.16) | $ (0.01) | ||
Per share, fully diluted |
|
|
|
|
|
|
|
|
1.6 Liquidity
The Company has total assets of $552,702. The primary assets of the Company are cash of $136,701, and acquisition and exploration cost of mineral properties of $379,582. The Company has no long-term liabilities and has working capital of $85,000. Subsequent to the financial statement date the Company received $332,500 (US $250,000). It is management's opinion that these assets are sufficient to meet the Company's obligations as they come due and that the Company is not exposed to any significant liquidity risks at this time.
1.7 Capital Resources
The Company does not own any producing mineral properties.
1.8 Off Balance Sheet Arrangements
There are no off-balance sheet arrangements to which the Company is committed.
1.9 Transactions with Related Parties
The Company incurred charges with directors of the Company and companies with common directors as follows:
Three months ended June 30, | Six months ended June 30, | ||||
2004 | 2003 | 2004 | 2003 | ||
Accounting fees | $ 3,561 | $ 1,400 | $ 4,761 | $ 3,925 | |
Consulting fees | 24,779 | 7,698 | 32,279 | 12,173 | |
Interest expense | - | - | - | 4,167 | |
Rent | - | 1,500 | 1,500 | 3,000 | |
_____________ | _____________ | _____________ | _____________ | ||
$ 28,340 | $ 10,598 | $ 38,540 | $ 23,265 | ||
_____________ | _____________ | _____________ | _____________ |
-17-
PAN AMERICAN GOLD CORPORATION
(formerly Tri Lateral Venture Corporation)
QUARTERLY REPORT
for the Quarter ended June 30, 2004 Page 6
1.10 Fourth Quarter
NA.
1.11 Proposed Transactions
The Company proposes to complete a financing in order to provide sufficient capital to explore its properties. Current near term plans are to drill test the Kinsley Mountain and Pinnacle properties during September 2004, conduct a comprehensive geophysical survey on the Eskay Creek claims, continue the evaluation of greater Cactus property, and to evaluate the Chilean properties that are under option and to reach a decision point with regard to exercising the Chilean option.
1.12 Critical Accounting Estimates
N/A
1.13 Changes in Accounting Policies
In 2004, the Company adopted the amended CICA Handbook Section 3870 - "Stock-based Compensation and Other Stock-based Payments". Previously, the Company accounted for stock-based compensation using the settlement method, whereby no compensation costs were recorded in the financial statements for stock options granted as the options had no intrinsic value at the date of grant. There have been no changes to the financial statements as a result of this change.
1.14 Financial Instruments and Other Instruments
The carrying value of cash and cash equivalents and accounts payable and accrued liabilities approximate their fair values due to the short maturity of those instruments. Unless otherwise noted, it is managements' opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial statements.
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PAN AMERICAN GOLD CORPORATION
(formerly Tri Lateral Venture Corporation)
QUARTERLY REPORT
for the Quarter ended June 30, 2004 Page 7
1.15 Other MD&A Requirements
Disclosure of Outstanding Share Capital
Outstanding as of August 30, 2004 |
|
|
Options
The Company issued on May 7 2004 options to acquire 1,300,000 common shares at a price of $0.02 per share. The Options have been valued at $ 0.19, an aggregate of $251,000 using the Black Scholes model using the following assumptions: This amount is being amortized to income over the vesting periods which are 12 months for 1,000,000 options and 6 months for 300,000 options.
Risk Free Rate | 3.0 % |
Volatility | NIL |
Expiry date | May 7, 2009 |
Number | 1,300,000 |
Vesting | 133,333 per month May 2004 to Oct 2004 |
83,333 per month November 2004 to May 2005 |
Subsequent Events
1. The Company arranged a private placement of $750,000, as of the date of this report $250,000 had been received.
2. The Company has entered into an option agreement to acquire mineral properties in Chile. The Company has paid $US 9,000 and will pay a further $16,000 to secure an option on the property. If the Company elects to exercise the option a further $US 100,000 payment is due in order to complete the option.
Additional Information
Additional information may be obtained on the Sedar website www.sedar.com or the Securities Exchange Commission website www.sec.gov.
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PAN AMERICAN GOLD CORPORATION
(formerly Tri Lateral Venture Corporation)
QUARTERLY REPORT
for the Quarter ended June 30, 2004 Page 8
Schedule of Exploration Expenses | ||||
6 months ended | ||||
Eskay Creek, British Columbia | ||||
Acquisition | 79,749 | |||
Geology & Engineering Fees | ||||
Maps and Copies | ||||
__________ | ||||
Total | 79,749 | |||
Pinnacle, Nevada | ||||
Acquisition | 38,104 | |||
Geology | 7,857 | |||
Assay Costs | 1,589 | |||
__________ | ||||
Total | 47,550 | |||
Kinsley Mtn, Nevada | ||||
Acquisition | 138,560 | |||
Geology & Engineering Fees | 6,493 | |||
Field Costs | ||||
__________ | ||||
Total | 145,053 | |||
Cactus, California | ||||
Acquisition | 59,795 | |||
Geology & Engineering Fees | 4,726 | |||
Drilling | 17,392 | |||
Licences & permits | 547 | |||
__________ | ||||
Total | 82,460 | |||
Lennie, Ontario | ||||
Acquisition | - | |||
Exploration | 12,775 | |||
__________ | ||||
12,775 | ||||
General | ||||
Geology & Engineering Fees | 11,996 | |||
__________ | ||||
11,996 | ||||
__________ | ||||
Total | $379,582 | |||
__________ |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Pan American Gold Corporation
/s/ Greg Burnett
Greg Burnett, Director
Date: September 3, 2004