SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended May 31, 2003 Commission file Number 1-7602
EXCALIBUR INDUSTRIES
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Utah 87-0292122
- ------------------------------- -----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
P.O. Box 3551, Duluth, MN 55803
- ------------------------------------------ ------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 218-724-4711
------------
E-Mail Address: [email protected]
Securities registered pursuant to Section 12 (b) of the Act:
Title of Each Class Name of each exchange on which registered
- ------------------------ -----------------------------------------
Common stock (Par value None
$.01 per share)
Securities registered pursuant to Section 12 (g) of the Act:
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
requirement for the past 90 days.
Yes [X] No [ ]
State the aggregate market value of the voting stock held by non-affiliates of
the registrant. The aggregate market value shall be computed by reference to the
price at which the stock was sold, or the average bid and asked prices of such
stock, as of a specified date within 60 days prior to the date of filing. As of
May 31, 2003, no bid or asked prices are available.
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date. As of May 31, 2003, the
registrant had total outstanding shares of 5,987,261, $0.01 par value common
stock.
Page 1
Securities and Exchange Commission - Form 10K
Excalibur Industries - May 31, 2003
Page 2
ITEM 1 - BUSINESS
Excalibur Industries is a Utah corporation formed by the consolidation of Tower
Enterprises (formerly Moab Uranium Company) and The Thrifty Helper on June 1,
1971. In January 1972, Excalibur purchased all of the issued and outstanding
shares of capital stock of Mountain West Mines, Inc., a Nevada corporation,
which is now a wholly owned subsidiary of Excalibur.
Excalibur Industries' business is natural resources and is primarily involved in
the uranium mining industry. The domestic uranium outlook is suffering its most
depressed state in its history. Current open market prices for yellow cake are
at all time lows and uranium production in the United States has all but
disappeared. The majority of the major mines and their United States Producers
have closed and abandoned the industry. Excalibur throughout this period has
been able to maintain its royalty position in the most valuable of its uranium
reserves located in the Powder River District of Wyoming.
With the limited resources available to Excalibur, it is not in a position to
actively participate in a mining program and must rely on its lease owners and
an improved market.
URANIUM REPORT
POWDER RIVER BASIN-WYOMING - HISTORY
- ------------------------------------
A. Mountain West Mines, Inc.
Beginning in 1965, Mountain West Mines Inc., a private corporation
founded by Claude E. Nugent, Robert H. Ruggeri and Joseph P. Hubert,
operated the underground Betty Mine and the open pit Glade Mine in the
Elk Ridge, Utah uranium district, each operation ending upon the
completion of their respective AEC contracts.
During the dormant years of the domestic uranium industry, MWM
continued full-time uranium exploration. In 1966, Mountain West Mines
began its successful geologic exploration of the Powder River, Wyoming
Uranium District. A large scale mineral property program was begun,
along with the beginning of the district reconnaissance drill hole
fence project.
In 1967, the Nuclear Power Industry revived interest in uranium fuels
and the Powder River Basin began to attract major corporate attention.
MWM in order to maintain viability was forced to seek outside financial
assistance.
B. The Cleveland-Cliffs Iron Company
Excalibur (Mountain West Mines Inc.) entered into an Option and
Agreement dated May 17, 1967, an Addendum dated August 29, 1967, an
Addendum dated August 31, 1968, and a Deed and Agreement dated October
20, 1976 with the Cleveland-Cliffs Iron Company.
Excalibur (MWM) retains a 4% yellow cake royalty on all production
resulting from the operations of the Cleveland-Cliffs Iron Company, its
assigns and/or its Successor in Interest within an Area of Interest
defined as Townships 33 through 50 North of Ranges 69 through 79 West,
6th principal meridian.
Page 2
Securities and Exchange commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 3
POWDER RIVER BASIN - WYOMING (Continued)
- ----------------------------------------
The Collins Draw ISL pilot program produced a minor royalty credit to
Excalibur.
In 1986, failing the contractual obligation of furnishing Excalibur
with prior written notification, the Cleveland-Cliffs Iron Company
assigned its operating rights to the Ruby ranch project subject to the
terms and conditions of MWM/Cliffs agreements to Magnox Electric plc
(UK) subsidiary Central Electricity Generating Board Exploration
(America) (CEGB). Cliffs retained reimbursement responsibility for Area
of Interest royalty obligation to Excalibur payable by its Successor in
Interest within the Area of Interest, less subject lands. In the event
of project abandonment by CEGB (et al), properties must be reassigned
to Cliffs.
In 1987, failing the contractual obligation of furnishing Excalibur
with prior written notification, the Cleveland-Cliffs Iron Company
assigned its operating rights to the Greasewood Creek and North Butte
projects subject to the terms and conditions of the MWM and Cliffs
agreements to Uranez USA, Inc. (Germany). Cliffs retained reimbursement
responsibility for Area of Interest royalty obligations to Excalibur
payable by its Successor in Interest within the Area of Interest less
subject lands. In the event of project abandonment by Uranez,
properties must be reassigned to Cliffs. Failing the contractual
obligation of furnishing Excalibur with prior written notification,
Cliffs sold Excalibur's advance royalty credit of some $1,319,287 to
Uranez.
C. Cameco Corporation, (Canada), (Power Resources Inc., a member of the Cameco
Group of Companies)
Cameco Corporation contends it is the world's largest producer of
uranium and the largest supplier of combined uranium and conversion
services. Through a series of transactions, Cameco with its subsidiary
Power Resources Inc., purports to have acquired the Powder River Basin
operating assets of CEGB and Uranez/Cogema. Excalibur has not received
proper documentation of either acquisition.
In July 2002, Cameco Corporation (PRI) purchased the operating Smith
Ranch ISL property which is producing yearly one million pounds plus.
The Smith Ranch is subject to the MWM/Cliffs agreements. No royalty
payments have been received to date.
It should be noted that in April 2003, Cameco's principal mine,
McArthur River (13,000,000 lbs./year), was flooded and its downtime is
unknown.
The following projects subject to Area of Interest royalty obligations
are listed in the Cameco Corporation 2002 Annual report:
Reserve Site Million Lbs. U308
------------ -----------------
Proven Probable Indicated Inferred
------ -------- --------- --------
Highland 2.9 5.0 2.9 1.9
North Butte/Brown 0.0 9.6 5.6 1.3
Ruby Ranch 2.9 1.4 0.6 0.0
Smith Ranch 6.6 13.7 0.1 4.2
Note: 1) The Greasewood deposit was not listed.
2) Taylor Ranch inferred pounds reduced from 10 million to 0.
3) The Grade/Thickness (GT) factor for reserve estimates was not revealed.
Page 3
Securities and Exchange Commission - form 10-K
Excalibur Industries - May 31, 2003
Page 4
POWDER RIVER BASIN - WYOMING (Continued)
- ----------------------------------------
D. Qivira Mining Company (Rio Algom Ltd. - Canada)
Rio Algom Ltd. was purchased by BHP Billiton (England) in 2001 and
reduced its uranium participation. In 2001 Quivira Mining Company
quitclaim re-assignment and conveyances by and among Quivira Mining and
Everest Exploration their sum total of 5,000 acres of unpatented mining
claims to Excalibur. Excalibur retained 100% claims ownership to six
(6) known potential ISL reserves. These reserves are independently
owned by Excalibur and not subject to the Cliffs/MWM agreements.
E. Excalibur's 7,000,000-foot (+) drill hole library covering over 500
square miles of the Powder River Basin could prove invaluable in a
profitable uranium market.
SILVER REPORT
Subsequent to May 31, 2003, the Trust for Public Land has exercised an option to
purchase 18 patented mining claims (158 acres) in Ouray County, Colorado for
$100,000.00.
BUSINESS
Excalibur is natural resource oriented. In the past its activities have
consisted of acquisition, mining and sale of mineral properties. The
Corporation's resources are extremely limited for a corporation of this
character. Under the present depressed market conditions it has no alternative
but to await a change. At the present time the corporation is inactive, except
for overseeing its leases and maintaining corporate viability.
ITEM 2 - PROPERTIES
- -------------------
Mountain West Mines, Inc. (Mountain West) a wholly owned subsidiary of
Excalibur, owns a royalty interest in approximately 85 patented lode mining
claims, and numerous unpatented lode mining claims in the Powder River Basin in
Johnson and Campbell Counties, Wyoming. These properties had capitalized costs
of $347,032, and are directly related to the advance royalties received from
Cliffs as described in Item 1 of this Form 10-K. The extent of any ore bodies
and related possible collection of production royalties is not determinable at
this time. The Board of Directors had determined, however, that a more realistic
value should be placed on the books for financial reporting and elected to
reduce the reported value for financial statement purposes to $100,000.
In May 1986, Cliffs conveyed, subject to the MWM/Cliffs agreements, to Magnox
Electric plc subsidiary, Central Electricity Generating Board Exploration Inc.
63.688 acres of patented claims and 12 unpatented mining claims (Ruby Ranch
project). In 1989, Magnox Electric through its subsidiaries CEGB and Power
Resources Inc. acquired 75% interest in the Highland Uranium Project (HUP) from
Everest Exploration (et al). HUP is subject to the terms and conditions of the
May 17, 1967 Option and Agreement and Addenda between MWM/Cliffs. According to
newspapers and other published accounts, HUP uranium production by Magnox
Electric subsidiaries indicates a multi-million dollar royalty payment is due
Excalibur.
In January 1997, Cameco Corporation (Canada) purchased the assets of CEGB and
Power Resources from Magnox Electric plc (UK) along with the obligations and
conditions set forth in the May 17, 1967 Option and Agreement and Addenda
between MWM/Cliffs. The HUP production royalties have not been paid by Cameco's
operator, its wholly owned subsidiary Power Resources Inc.
Page 4
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 5
ITEM 2 - Properties (Continued)
- -------------------------------
The right of reassignment of all uranium mineral properties within the Area of
Interest is retained by Excalibur as set forth by the May 17, 1967 Option and
Agreement.
In April 1987, Excalibur had not received the contractual obligation of prior
written notice when Uranez USA (Germany) purchased unpatented claims and the
below cited patented claims along with the remaining portion of MWM advance
royalty from Cliffs. The transaction subjected Uranez to the obligations as
conditions set forth in the May 17, 1967 Option and Agreement and Addenda
between MWM/Cliffs.
North Butte Deposit Area
------------------------
Pfister Patent - 49-77-0019 222.420 acres
Brown Patent - 49-77-0022 730.016 acres
-------
952.436 acres
Surface acres included with mineral acres 309.000 acres
Greasewood Creek Deposit Area
-----------------------------
Greasewood Creek Patent - 49-75-0068 646.596 acres
Surface acres 0.000 acres
In May 1991, failing the contractual obligation of furnishing Excalibur with
prior written notification, Pathfinder Mines, Inc., subsidiary of Cogema-France,
purchased Uranez' Powder River Uranium holdings along with the remaining portion
of MWM advance royalty. This transaction subjected Pathfinder to the terms and
conditions as outlined in the May 17, 1967 Option and Agreement and Addenda
between MWM/Cliffs. Subsequently, Pathfinder assumed the Christianson Ranch ISL
operation and failed to make Area of Interest royalty payments to Excalibur.
Between the delinquent royalty payments from the HUP and the Christianson Ranch
operations, the advance royalty payment obligation of $1,319,287.00 has been
satisfied.
In 1973, Excalibur sold mining claims in Campbell and Johnson Counties, Wyoming
to American Nuclear Corporation. The project became a part of a joint venture
between American Nuclear and the Tennessee Valley Authority. At public auction
in 1991, they sold this project along with their entire holdings to General
Atomic. In 1992, General Atomic sold this same project to Pathfinder. Excalibur
retains a 2 1/2 % yellow cake royalty from the ANC contract and an additional 4%
yellow cake royalty from the MWM/Cliffs Area of Interest royalty provision.
In 2001, failing the contractual obligation of furnishing Excalibur with prior
written notification, Pathfinder Mines Inc. (Cogema) executed Special Warranty
Deeds with Cameco Corporation (Canada) through its wholly owned subsidiary Power
Resources Inc., transferring Pathfinder's Powder River uranium holdings.
Camecos' acquisition of that portion of Pathfinder's mineral properties acquired
from the Uranez/Cliffs contract, commits Cameco and its wholly owned subsidiary
Power Resources Inc. to a second acknowledgment to the terms and conditions in
the May 17, 1967 Option and Agreement and Addenda between MWM/Cliffs. These
mineral lands are within the Area of Interest and are subject to a 4% yellow
cake gross royalty in addition to the royalty obligations inherent in their
title.
In July 1983, Cliffs quitclaimed 436 unpatented lode mining claims and 1,042 net
acres of fee mineral leases to Texas Eastern Nuclear, Inc., of Houston, Texas.
In August 1986, Texas Eastern Nuclear, Inc., reassigned said properties to
Mountain West, who, in turn, conveyed and assigned its interest in said property
to Everest Minerals, subject to a variable overriding royalty reservation which
ranges 2% to 6%. Everest Minerals determined to abandon a portion of the
property and offered to re-convey it to Excalibur. Excalibur has since abandoned
said property.
Page 5
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 6
ITEM 2 - PROPERTIES (Continued)
- -------------------------------
On June 28, 1990, Everest Minerals sold the remaining 270 claims to Quivira
Mining Company, 6305 Waterford Boulevard, Suite 325, Oklahoma City, Oklahoma
73118, a subsidiary of Rio Algom Ltd., a Canadian based world producer of
uranium and other metals. Excalibur retained the right of reassignment.
In 2001, Quivira Mining company reassigned the 270 claims to Excalibur. 100%
ownership of six (6) potential ISL reserves is held by Excalibur. The following
uranium reserve estimates are Texas Eastern Nuclear Inc., calculatons:
Deposit Area Average Depth Indicated Reserves Potential Reserves
------------ ------------- ------------------ ------------------
Verna Ann 580' 701,000# 1,500,000#
Niles Ranch 450' 270,000# 600,000#
Hank 420' 600,000# 2,000,000#
Willow Creek 600' 850,000# 2,000,000#
Doughstick 540' -0- 6,000,000#
Nichols Ranch 590' 3,500,000# 4,500,000#
Excalibur owns 100% of 100 unpatented mining claims which were reassigned by PRI
(Cameco) March 2003 in keeping with the Successor-in-Interest status to the
MWM/Cliffs May 17, 1967 Option and Agreement.
Excalibur owns patented mining claims in Ouray county, Colorado with capitalized
costs of $8,106. These properties were purchased as silver prospects and are not
active. Subsequent to May 31, 2003 these claims were sold for $100,000.00.
ITEM 3 - Legal Proceedings
- --------------------------
Management of the Registrant knows of no litigation that would materially affect
the financial statements of Excalibur or Mountain West Mines, Inc.
ITEM 4 - Submission of Matters to a Vote of Security Holders
- ------------------------------------------------------------
(a-d) No matters were submitted to a vote of security holders during the
quarter ended May 31, 2003 through solicitation of proxies or
otherwise. The last annual shareholder's meeting of the Company was
held November 18, 2002.
ITEM 5 - Market for the Registrant's Common Equity
and Related Stockholder Matters
- --------------------------------------------------------------------------------
(a) Principal Market: The stock of the Corporation was formerly traded on
the Intermountain Stock Exchange in Salt Lake City, Utah. At the
present time the stock is not traded on a listed stock exchange and the
Company knows of no market maker.
(b) Approximate number of shareholders of record as of May 31, 2003 is 425.
(c-1) No dividends have been paid or declared in the past 5 fiscal years.
(c-2) Management anticipates no payment of dividends in the near future.
Page 6
Securities and Exchange commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 7
ITEM 6 - Selected Financial Data For The Years Ended May 31:
2003 2002 2001 2000 1999
----------- ----------- ----------- ----------- -----------
Total Revenues $ 0 $ 0 $ 0 $ 0 $ 0
Total Operating Expense (13,861) 17,372 12,813 17,176 14,928
----------- ----------- ----------- ----------- -----------
Loss From Operations (13,861) (17,372) (12,813) (17,176) (14,928)
Other Income (Expense) (9,352) 0 0 7,188 201
----------- ----------- ----------- ----------- -----------
Income (Loss) -
Before Income Taxes (23,213) (17,372) (12,813) (9,988) (14,727)
Provision For Income Taxes 100 100 100 100 100
----------- ----------- ----------- ----------- -----------
Net Income (Loss) (23,313) (17,472) (12,913) (10,088) (14,827)
Retained Earnings (Deficit)
Beginning of Year (61,821) (44,349) (31,436) (21,348) (6,521)
----------- ----------- ----------- ----------- -----------
Retained Earnings (Deficit)
End of Year $ (85,134) $ (61,821) $ (44,349) $ (31,436) $ (21,348)
=========== =========== =========== =========== ===========
Average Shares of Common
Stock Outstanding 5,987,261 5,987,311 5,987,361 5,987,361 5,987,361
=========== =========== =========== =========== ===========
Net Income (Loss) Per Share
of Common Stock $ (0.0039) $ (0.0029) $ (0.0022) $ (0.0017) $ (0.0025)
=========== =========== =========== =========== ===========
Total Assets -
End of Year $ 108,597 $ 110,958 $ 108,435 $ 122,348 $ 122,436
=========== =========== =========== =========== ===========
Long-Term Obligations $ 49,852 $ 29,000 $ 9,000 $ 0 $ 0
=========== =========== =========== =========== ===========
Cash Dividends Declared
Per Share of
Common Stock $ 0 $ 0 $ 0 $ 0 $ 0
=========== =========== =========== =========== ===========
ITEM 7 - Management's Discussion and Analysis of Financial Condition
and Results of Operations
- --------------------------------------------------------------------------------
Excalibur Industries experienced substantial fluctuations in its consolidated
net income over the past several years. The Company maintained its mineral
properties and interest throughout that period of fluctuation despite a large
drain on its financial resources. Management is now working to retain as much of
its mineral rights and interests as possible, considering its limited resources
and the depressed market conditions.
Page 7
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 20032
Page 8
ITEM 7 - Management's Discussion and Analysis of financial Condition
and Results of Operations, (Continued)
- --------------------------------------------------------------------------------
The Board of Directors has adopted a policy designed to husband its resources
and retain as much of its mineral interests as possible, taking into account the
depressed market for minerals and the Company's limited resources.
The consolidated financial statements contained herein under ITEM 8 should be
read in conjunction with this ITEM 7, with particular emphasis on the Notes to
Consolidated Financial Statements. Additional information pertaining to the
fluctuation of the Company's income and expenses is detailed.
ITEM 8 - Financial Statements and Supplementary Data
- ----------------------------------------------------
Page 8
Securities and Exchange commission - Form 1-K
Excalibur Industries - May 31, 2003
Page 9
ACCOUNTANTS' COMPILATION REPORT
To the Board of Directors and Stockholders
Excalibur Industries
We have compiled the accompanying consolidated balance sheets of Excalibur
Industries (Corporation) and its wholly owned subsidiary, Mountain West Mines,
Inc. as of May 31, 2003, 2002, and 2001, and the related consolidated statements
of operations and changes in retained earnings (deficit), and cash flows for the
years then ended, in accordance with Statements on Standards for Accounting and
Review Services issued by the American Institute of Certified Public
Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. We have not audited or
reviewed the accompanying financial statements and, accordingly, do not express
an opinion or any other form of assurance on them.
/s/ Maxfield and Co., P.C.
Maxfield and Co., P.C.
Certified Public Accountants
Grand Junction, Colorado
July 22, 2003
Page 9
Securities and Exchange commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 10
Consolidated Balance Sheets
May 31, 2003, 2002 and 2001
(Unaudited)
2003 2002 2001
--------- --------- ---------
ASSETS
Current Assets
Cash $ 391 $ 2,752 $ 229
--------- --------- ---------
Property and Equipment
Mining properties and interests 108,106 108,106 108,106
Furniture and fixtures 2,354 2,354 2,354
Mining equipment 1,347 1,347 1,347
--------- --------- ---------
111,807 111,807 111,807
Accumulated depreciation (3,661) (3,661) (3,661)
--------- --------- ---------
Total Property and Equipment 108,146 108,146 108,146
--------- --------- ---------
Other Assets
Deposits 60 60 60
--------- --------- ---------
Total Assets $ 110,597 $ 110,958 $ 108,435
========= ========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Income tax payable $ 100 $ 100 $ 100
--------- --------- ---------
Other Liabilities
Loans from stockholder 40,500 29,000 9,000
Accrued interest - loans from stockholder 9,352 -- --
Option to sell mining claims 100 -- --
--------- --------- ---------
Total Other Liabilities 49,952 29,000 9,000
--------- --------- ---------
Total Liabilities 50,052 29,100 9,100
--------- --------- ---------
Stockholders' Equity
Common stock - $.01 par value,
authorized 10,000,000 shares,
issued 5,997,361 shares including shares in treasury 59,974 59,974 59,974
Capital received in excess of par value 83,810 83,810 83,810
Retained earnings (deficit) (85,134) (61,821) (44,349)
Treasury stock, 10,100 shares
(10,000 shares in 2001), at cost (105) (105) (100)
--------- --------- ---------
Total Stockholders' Equity 58,545 81,858 99,335
--------- --------- ---------
Total Liabilities and Stockholders' Equity $ 108,597 $ 110,958 $ 108,435
========= ========= =========
See accompanying notes and accountants' compilation report.
Page 10
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 11
Consolidated Statements of Operations and Changes in Retained Earnings (Deficit)
Years Ended May 31, 2003, 2002 and 2001
(Unaudited)
2003 2002 2001
----------- ----------- -----------
Revenues
Royalties $ -- $ -- $ --
----------- ----------- -----------
Operating Expenses
Mining and related expenses -- -- --
General and administrative 13,861 17,372 12,813
----------- ----------- -----------
Total Operating Expenses 13,861 17,372 12,813
----------- ----------- -----------
Loss From Operations (13,861) (17,372) (12,813)
----------- ----------- -----------
Other Income (Expense)
Interest (9,352) -- --
----------- ----------- -----------
(Loss) Before Income Taxes (23,213) (17,372) (12,813)
Provision For Income Taxes 100 100 100
----------- ----------- -----------
Net (Loss) (23,313) (17,472) (12,913)
Retained Earnings (Deficit) - Beginning of Year (61,821) (44,349) (31,436)
----------- ----------- -----------
Retained Earnings (Deficit) - End of Year $ (85,134) $ (61,821) $ (44,349)
=========== =========== ===========
Net (Loss) Per Share of Common Stock $ (0.0039) $ (0.0029) $ (0.0022)
=========== =========== ===========
Outstanding Number of Common Shares 5,987,261 5,987,311 5,987,361
=========== =========== ===========
See accompanying notes and accountants' compilation report.
Page 11
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 12
Consolidated Statements of Cash Flows
Years Ended May 31, 2003, 2002 and 2001
(Unaudited)
2003 2002 2001
-------- -------- --------
Cash Flows From Operating Activities
Net (loss) $(23,313) $(17,472) $(12,913)
Adjustments to reconcile net loss to net cash
provided by operating activities
Increase (Decrease) in:
Accrued interest - loans to shareholder 9,352 -- --
-------- -------- --------
Net Cash Used By Operating
Activities (13,961) (17,472) (12,913)
-------- -------- --------
Cash Flows From Investing Activities
Option to sell mining claims 100 -- --
-------- -------- --------
Cash flows From Financing Activities
Proceeds from loans
from stockholders 11,500 20,000 9,000
Capital Stock transactions:
Share repurchases -- (5) --
-------- -------- --------
Net Cash Provided
By Financing Activities 11,500 19,995 9,000
-------- -------- --------
Net Increase (Decrease) In Cash (2,361) 2,523 (3,913)
Cash - Beginning of Year 2,752 229 4,142
-------- -------- --------
Cash - End of Year $ 391 $ 2,752 $ 229
======== ======== ========
Supplemental Disclosures
Income taxes paid $ 100 $ 100 $ 100
Interest Paid -- -- --
See accompanying notes and accountants' compilation report.
Page 12
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 13
Notes to Consolidated Financial Statements
(Unaudited)
Note 1 - Summary of Significant Accounting Policies
- ---------------------------------------------------
Consolidation
-------------
The consolidated financial statements presented herein include the
accounts of Excalibur Industries (Excalibur) and its wholly owned
subsidiary, Mountain West Mines, Inc., (Mountain West), a Nevada
corporation, qualified to do business in the states of Utah and Wyoming.
All significant intercompany transactions have been eliminated from
these statements.
Mining Properties and Interests
-------------------------------
Mining claims, leases, and royalty interests are stated at cost, unless
in the judgement of the Directors a lesser amount is felt to be more
appropriate due to a permanent decline in value. No depletion has been
charged against income for financial statement purposes, but is deducted
for Federal income tax purposes when allowable. The full carrying value
is charged against income at the time of sale of disposition of an
asset. If a perpetual overriding royalty is retained the recorded costs
of the asset are treated the same for financial statement purposes as
for income tax purposes and are not reduced in value until production
royalties are received.
Depreciable Property and Equipment
----------------------------------
Depreciable property and equipment are stated at cost. Depreciation for
income tax purposes is consistent with that used for financial statement
purposes and has been computed using the straight-line method.
Deferred Income Taxes
---------------------
Deferred income taxes are provided as a result of timing differences in
reporting income for financial statement and tax purposes. Currently no
deferred income taxes payable (or receivable) are recognized.
Use of Estimates
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
Earnings Per Share
------------------
Earnings per share of common stock are computed using the weighted
average number of common shares outstanding during the period. Primary
and full diluted earnings per share are shown as the same figure if the
dilative effect of any common stock equivalents or convertible
securities are less than three percent. The Company currently has no
dilative equivalents.
Page 13
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 14
Notes to Consolidated Financial Statements
(Unaudited)
Note 2 - Mining Properties and Interests
- ----------------------------------------
Uranium
-------
The Company owns various royalty and other interests in patented and
unpatented mining claims and mineral leased acreage, located in the
Powder River Basin, Johnson and Campbell Counties, Wyoming. Future
earned royalties are subject to offset by the amount of certain advance
minimum royalty revenues. These properties were assigned a value of
$347,032 following the acquisition of Mountain West by Excalibur.
Various acreage has been dropped during the past years as such acreage
was determined to be of no value. The capitalized costs of these
properties have been reallocated to the remaining acreage still retained
by the Company. The Board of Directors determined that a more realistic
value should be placed on the books and elected to reduce the reporting
value for financial statement purposes by $247,032.
Silver
------
The Company owns various interests in patented mining claims in Ouray
County, Colorado. Subsequent to May 31, 2003, these claims were sold for
$100,000.
A summary of capitalized costs in the above properties as of May 31,
2003, 2002 and 2001 follows:
2003 2002 2001
-------- -------- --------
Uranium $100,000 $100,000 $100,000
Silver 7,957 7,957 7,957
Other 149 149 149
-------- -------- --------
Total $108,106 $108,106 $108,106
======== ======== ========
Note 3 - General and Administrative Expense
- -------------------------------------------
General and administrative expenses for the years ended May 31, 2003,
2002 and 2001 follows:
2003 2002 2001
------- ------- -------
Salaries $ -- $ -- $ --
Reports and publications 1,223 1,764 1,069
Professional 4,773 3,816 4,593
Telephone, office
supplies and other 7,865 11,792 7,151
------- ------- -------
Total $13,861 $17,372 $12,813
======= ======= =======
Page 14
Securities and Exchange Commission - form 10-K
Excalibur Industries - May 31, 2003
Page 15
Notes to Consolidated Financial Statements
(Unaudited)
Note 4 - Income Taxes
- ---------------------
Currently, no deferred income taxes payable (or receivable) are
recognized as a result of timing differences in reporting income for
financial accounting and tax purposes.
Deferred income taxes on unrealized losses in the amount $247, 032 due
to the reduction in value of royalty interests has not been recognized
in the financial statements due to the uncertainty of any future tax
benefit. Likewise, deferred income taxes are not affected as a result of
statutory depletion deductions taken for tax purposes.
As of May 31, 2003, the Company has loss carryforwards of approximately
$268,000 for Federal tax purposes and $183,000 for State tax purposes
that may be offset against future taxable income (expiring on various
dates through 2023).
Note 5 - Operating Funds
- ------------------------
Company management has developed a plan to reduce or delay
administrative costs to insure that the Company will continue to meet
its obligations during the coming year, as well as a plan to obtain
additional operating funds, if needed, through the sale of certain of
its mining properties.
In the interim, Joseph P. Hubert, President and major stockholder, has
agreed to advance operating funds as needed, until other funds are
available. Subsequent to May 31, 2003, total advances, with interest,
were paid in full from proceeds received from the sale of the Ouray
County, Colorado mining claims.
Page 15
Securities and Exchange commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 16
ITEM 9 - Disagreements on Accounting and Financial Disclosures
- --------------------------------------------------------------
None
ITEM 10 - Directors and Executive Officers of the Registrant
- ------------------------------------------------------------
(a, b & e) Name Age Position
--------------------- --- -----------------------------------
Joseph P. Hubert 71 President, Chief Executive Officer
and Chairman of Board of Directors
Jack D. Powers 77 Vice-President and Director
Charles O. Spielman 69 Treasurer and Director
Marguerite Emanuel 69 Secretary
Joseph P. Hubert is President and Chief Executive Officer. He received his B.S.
Degree in Geology from the University of Minnesota Duluth. He has been a
self-employed registered mining geologist for many years. He served on the Board
of Directors of Mountain West Mines, Inc. from 1966 until 1971, either as
President or Vice-President during that period. Mr. Hubert was elected to the
Presidency and Board of Directors of Excalibur at the 1982 annual meeting and
following Directors' meeting.
Jack D. Powers is Vice-President. He obtained a BA Degree in business and
accounting from the University of Minnesota and a B.S. Degree in mechanical
engineering from Michigan Tech. He has worked as a manager for Longyear Drilling
Co., Boyles Bros. and Joy for many years and presently is a self-employed
drilling consultant.
Charles O. Spielman was elected Treasurer and to the Board of Directors at a
special meeting of the Board effective July 1, 1999. He received his B.S. degree
in Geological Engineering from Colorado School of Mines in 1955 and is a
consulting mining geologist.
Marguerite H. Emanuel replaced Charles O. Spielman as Secretary on March 1,
2001. She received her BS Degree in Business and accounting from the University
of Minnesota. She was a department manager with the Marriott Corporation and an
administrative assistant with the Village of Lincolnshire, Illinois.
(c) Excalibur has no full time employees.
(d) Mrs. Marguerite Emanuel was elected Corporate Secretary at the November 19,
2001 Annual Meeting. Mrs. Emanuel is the sister of Joseph P. Hubert,
President and CEO. There are no other family relationships between any
Director and Executive Officer and/or any other Director or Executive
officer or nominee for Director.
(f) No Officer, Director or nominee for Director has been involved in any legal
proceedings involving Federal bankruptcy laws, or any State insolvency
laws, or has been convicted or named in a criminal proceeding, or is the
subject of any order, judgement, or decree limiting him in any activity, or
from engaging in any type of business practice, or from engaging in any
activity in connection with the purchase or sale of any security, or in
connection with any violation of Federal or State security laws.
ITEM 11 - Management Remuneration
- ---------------------------------
Excalibur and Mountain West Mines, Inc., has no employees or payroll and pays no
compensation to management. However, it does pay medical insurance for its
President and management for reimbursement of expenses.
Page 16
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 17
ITEM 12 - Security Ownership of Certain Beneficial Owners and Management
- ------------------------------------------------------------------------
(a) Security Ownership of Certain Beneficial Owners:
*Amount and Percent
Nature of of class
Name and Address Beneficial as of
Title of Class of Beneficial owner Ownership 5/31/03
-------------- ----------------------------------------- -------------- -------
Common Joseph P. Hubert 1,179,000 19.69%
1800 Lakeview Drive Direct
Duluth, MN 55803
Common Allen E. Nugent, Trustee of the *868,000 14.50%
Claude E. Nugent Trust Direct
10238 South 2375 East
Sandy, UT 84092
Common Robert H. Ruggeri 336,683 5.62%
3314 Music Lane Direct
Grand Junction, CO 81506
Common Jack D. Payne 302,540 5.05%
Box 2951 Direct
Grand Junction, CO 81501
Common Service Credit Corp.
377 N. Main 300,000 5.01%
Layton, UT 84041 Direct
*Includes 24,000 shares owned by Allen Nugent's wife, and 24,000 shares
owned by Allen E. Nugent, son of Claude E. Nugent.
(b) Security Ownership of Management:
*Amount and Percent
Nature of of class
Name and Address Beneficial as of
Title of Class of Beneficial Owner Ownership 5/31/03
-------------- ------------------------------------ -------------- -------
Common Joseph P. Hubert 1,179,000 19.69%
Common Jack D. Powers 25,000 .42%
Common Charles O. Spielman 50,000 .84%
Common Marguerite Emanuel 100,000 1.68%
Common Directors and Officers Group 1,354,000 22.63%
Page 17
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 18
ITEM 12 - Security Ownership of Certain Beneficial Owners
and Management, (Continued)
- --------------------------------------------------------------------------------
*Information as to beneficial ownership is based upon statements furnished
by each Director. Information with such ownership rests peculiarly within
their knowledge and the Registrant disclaims responsibility for the
accuracy and completeness thereof.
(c) Changes in Control:
No arrangements are known to Registrant which may at a subsequent date
result in a change in control of the Registrant.
ITEM 13 - Certain Relationships and Related Transactions
- --------------------------------------------------------
(a) Transactions with Management and Others None
(b) Certain Business Relationships None
(c) Indebtedness of Management None
(d) Transactions with Promoters None
ITEM 14 - Exhibits, Financial Statement Schedules, and Reports on Form 10-K
- ---------------------------------------------------------------------------
(a) 1. Unaudited Consolidated Financial Statements for the fiscal years ended
May 31, 2003, 2002 and 2001, including:
Accountants' Compilation Report
Consolidated Balance Sheets
Consolidated Statements of Operations and Changes in Retained
Earnings (Deficit)
Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
2. None
3. None
(b) No reports on Form 8-K have been filed during the quarter ended May 31,
2003.
(c) None
(d) None
Page 18
Securities and Exchange Commission - Form 10-K
Excalibur Industries - May 31, 2003
Page 19
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
Date August 5, 2003 By /s/ Joseph P. Hubert
--------------------------- ----------------------------------
Joseph P. Hubert
President, Chief Executive Officer
and Chairman of Board of Directors
Date August 5, 2003 By /s/ Jack D. Powers
--------------------------- ----------------------------------
Jack D. Powers
Vice-President and Director
Page 19
Certification of Chief Financial Officer
Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
I, Joseph P. Hubert, certify that:
1. I have reviewed this annual report on Form 10-K of Excalibur
Industries;
2. Based on my knowledge, this annual report does not contain any
untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light
of the circumstances under which such statements were made,
not misleading with respect to the period covered by this
annual report;
3. Based on my knowledge, the financial statements, and other
financial information included in this annual report, fairly
present in all material respects the financial condition,
results of operations and cash flows of the registrant as of,
and for, the periods presented in this annual report;
4. The registrant's other certifying officers and I are
responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to
ensure that material information relating to the
registrant, including its consolidated subsidiaries, is
made known to us by others within those entities,
particularly during the period in which this annual
report is being prepared;
b) evaluated the effectiveness of the registrant's
disclosure controls and procedures as of a date within 90
days prior to the filing date of this annual report (the
"Evaluation Date"); and
c) presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures
based on our evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have
disclosed, based on our most recent evaluation, to the
registrant's auditors and the audit committee of registrant's
board of directors (or persons performing the equivalent
function):
a) all significant deficiencies in the design or operation
of internal controls which could adversely affect the
registrant's ability to record, process, summarize and
report financial data and have identified for the
registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves
management or other employees who have a significant role
in the registrant's internal controls; and
6. The registrant's other certifying officers and I have
indicated in this annual report whether or not there were
significant changes in internal controls or in other factors
that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and
material weaknesses.
Date: August 4, 2003 /s/:JOSEPH P. HUBERT
- --------------------- ------------------------------------------
President, Chief Executive Officer,
Chairman (Principal Financial Officer)
20