PART I
ITEM
1 - Identity of Directors, Senior Management and Advisers
All items
in this section are not required, as this 20-F filing is made as an annual report.
ITEM
2 - Offer Statistics and Expected Timetable
All items
in this section are not required, as this 20-F filing is made as an annual report.
ITEM
3 - Key Information
A.
Selected Financial Data
The
following tables set forth the data of our fiscal years ended December 31, 2013 2012, 2011, 2010, and 2009. We derived all figures
from our financial statements as prepared by our management, approved by our Board of Directors (who act as our audit committee)
and audited by our auditors. This information should be read in conjunction with our financial statements including the notes
thereto, and “Item 5 - Operating and Financial Review and Prospects” included in this annual report. Our financial statements
are expressed in US dollars and presented in accordance with accounting principles generally accepted in the United States.
|
|
|
Year
ended December 31,
|
|
|
|
|
2013
$
|
|
|
2012
$
|
|
|
2011
$
|
|
|
2010
$
|
|
|
2009
$
|
|
|
Net
income (loss) for the year
|
|
|
196,407
|
|
|
|
206,142
|
|
|
|
(124,987
|
)
|
|
|
(80,219
|
)
|
|
|
(121,795
|
)
|
|
Weighted
average number of shares
outstanding
|
|
|
14,522,727
|
|
|
|
14,522,727
|
|
|
|
14,522,727
|
|
|
|
35,225,062
|
|
|
|
28,322,045
|
|
|
Earnings
(loss) per share
, basic and diluted
|
|
|
0.01
|
|
|
|
0.01
|
|
|
|
(0.01
|
)
|
|
|
–
|
|
|
|
–
|
|
|
|
|
As at
December 31,
|
|
|
|
|
2013
$
|
|
|
2012
$
|
|
|
2011
$
|
|
|
2010
$
|
|
|
2009
$
|
|
|
Total
assets
|
|
|
317,770
|
|
|
|
71,503
|
|
|
|
1,907
|
|
|
|
1,851
|
|
|
|
754
|
|
|
Net
assets
|
|
|
77,298
|
|
|
|
(208,608
|
)
|
|
|
(414,750
|
)
|
|
|
(289,763
|
)
|
|
|
(263,544
|
)
|
|
Common
stock
|
|
|
2,358,954
|
|
|
|
2,358,954
|
|
|
|
2,358,954
|
|
|
|
2,358,954
|
|
|
|
2,304,954
|
|
KBridge
Energy Corp. or “KBridge” or the “Company” undertakes certain transactions in Caadian (“Cdn”)
dollars and records and reports its operations in US dollars. Fluctuations in the exchange rate between the Cdn dollar and the
US dollar will affect the amount of dollars reported in its financial statements and distributed in respect of cash dividends
paid out or other distributions paid in Cdn dollars by us. The Company has never paid out a dividend to its shareholders.
The
following table sets forth, foreign exchange rates, for the periods and dates indicated, certain information concerning the noon
buying rate for CDN$. No representation is made that the CDN dollar amounts referred to herein could have been or could be converted
into US dollars at any particular rate, or at all.
YEARS ENDED
DECEMBER 31, (CDN$ PER US$1.00)
|
Period
|
|
Average
(1)
|
|
|
2009
|
|
$
|
1.1420
|
|
|
2010
|
|
$
|
1.0299
|
|
|
2011
|
|
$
|
0.9891
|
|
|
2012
|
|
$
|
0.9996
|
|
|
2013
|
|
$
|
0.9707
|
|
(1)
Note: the average for the year of the noon buying rates on the last date of each month (or a portion thereof) during the period.
FOR EACH
OF THE PAST SIX MONTHS (CDN$ PER US$1.00)
|
Period
|
|
Low
|
|
|
High
|
|
|
Month ended August 30, 2013
|
|
$
|
0.9471
|
|
|
$
|
0.9471
|
|
|
Month ended September 30, 2013
|
|
$
|
0.9732
|
|
|
$
|
0.9702
|
|
|
Month ended October 31, 2013
|
|
$
|
0.9604
|
|
|
$
|
0.9559
|
|
|
Month ended November 29, 2013
|
|
$
|
0.9471
|
|
|
$
|
0.9408
|
|
|
Month ended December 31, 2013
|
|
$
|
0.9419
|
|
|
$
|
0.9390
|
|
|
Month ended January 31, 2014
|
|
$
|
0.9018
|
|
|
$
|
0.8909
|
|
Note: the
noon buying rates on the last date of each month
B.
Capitalization and Indebtedness
Not required
as this 20-F filing is made as an annual report.
C.
Reasons for the Offer and Use of Proceeds
Not required
as this 20-F filing is made as an annual report.
D.
Risk Factors
THERE
ARE SIGNIFICANT RISKS ASSOCIATED WITH AN INVESTMENT IN OUR COMMON STOCK. BEFORE MAKING A DECISION CONCERNING THE PURCHASE OF OUR
SECURITIES, YOU SHOULD CAREFULLY CONSIDER THE FOLLOWING FACTORS AND OTHER INFORMATION IN THIS ANNUAL REPORT WHEN YOU EVALUATE
OUR BUSINESS.
Business
Risks
:
Risks
Associated with Our Company.
We
have a limited history of operations which makes it difficult to evaluate the investment merits of our Company.
If we do not
obtain additional financing, our business will fail because we will be unable to fund even the administration of our minimal operations.
In
order for the Company to continue we need to obtain additional financing. As of December 31, 2013, we had cash in the amount of
$22,164.
The
future issuance of debt may contain contractual restrictions that may curtail implementation of our business plan.
We
do not have any contractual restrictions limiting our ability to incur debt. Any significant indebtedness, however, could restrict
our ability to fully implement our business plan. If we are unable to repay the debt, we could be forced to cease operating.
The
loss of any of our key personnel may affect our ability to implement our business plan and cause our stock to decline in value.
We
are dependent on Jai Woo Lee, Chairman and Director of the Company, to implement our business plan and the loss of his services
may have a negative effect on our ability to timely and successfully implement our business plan. We do not have an employment
agreement with Jai Woo Lee and we have not obtained key man insurance over him.
Investment
Risks:
Any
issuance of additional shares may have the effect of diluting the interest of existing shareholders; shareholders of our common
stock do not have preemptive rights.
Any additional issuances of common stock by us from our authorized but
unissued shares may have the effect of diluting the percentage interest of existing shareholders. The securities issued to raise
funds may have rights, preferences or privileges that are senior to those of the holders of our other securities, including our
common stock. The board of directors has the power to issue such shares without shareholder approval. We fully intend to issue
additional common shares in order to raise capital to fund our business operations and growth objectives.
We
do not anticipate paying dividends to our common stockholders in the foreseeable future, which makes investment in our stock speculative
and risky.
We
have not paid dividends on our common stock and do not anticipate paying dividends on our common stock in the foreseeable future.
The board of directors has sole authority to declare dividends payable to our stockholders. The fact that we have not paid and
do not plan to pay dividends indicates that we must use all of our funds we generate for reinvestment in our business activities.
Investors also must evaluate an investment in the Company solely on the basis of anticipated capital gains.
Limited
liability of our executive officers and directors may discourage shareholders from bringing a lawsuit against them.
Our
Memorandum and Articles of Incorporation contain provisions that limit the liability of our directors for monetary damages and
provide for indemnification of officers and directors. These provisions may discourage shareholders from bringing a lawsuit against
officers and directors for breaches of fiduciary duty and may reduce the likelihood of derivative litigation against officers
and directors even though such action, if successful, might otherwise have benefited the shareholders. In addition, a shareholder’s
investment in the Company may be adversely affected to the extent that we pay costs of settlement and damage awards against officers
or directors pursuant to the indemnification provisions of the bylaw. The impact on a shareholder’s investment in terms of the
cost of defending a lawsuit may deter the shareholder from bringing
suit against any of our officers or directors. We have been
advised that the SEC takes the position that these article and bylaw provisions do not affect the liability of any director under
applicable federal and state securities laws.
Since
we are a Canadian company and most of our assets and key personnel are located outside of the United States of America, you may
not be able to enforce any United States judgment for claims you may bring against us, our assets, our key personnel or the experts
named in this document.
We
have been organized under the laws of Canada. Many of our assets are located outside the United States. In addition, a majority
of the members of our board of directors and our officers and the experts named in this document are residents of countries other
than the United States. As a result, it may be impossible for you to effect service of process within the United States upon us
or these persons or to enforce against us or these persons any judgments in civil and commercial matters, including judgments
under United States federal securities laws. In addition, a Canadian court may not permit you to bring an original action in Canada
or to enforce in Canada a judgment of a U.S. court based upon civil liability provisions of U.S. federal securities laws.
FORWARD
LOOKING STATEMENTS
This
document contains forward-looking statements. We intend to identify forward-looking statements in this document using words such
as “anticipates”, “will”, “believes”, “plans”, “expects”, “future”,
“intends” or similar expressions. These statements are based on our beliefs as well as assumptions we made using information
currently available to us. Because these statements reflect our current views concerning future events, these statements involve
risks, uncertainties and assumptions. Actual future results may differ significantly from the results discussed in the forward-looking
statements. Some, but not all, of the factors that may cause these differences include those discussed in the Risk Factors section.
You should not place undue reliance on these forward-looking statements.
ITEM
4 - Information on the Company
A.
History and Development of the Company
KBridge
Energy Corp (“KBridge” or the “Company”) was originally incorporated on October 23, 2002 under the laws of
British Columbia, Canada with the name Penn Biotech Inc. On January 13, 2005, the Company changed its name to United Traffic System
Inc. On November 30, 2007, it consolidated its outstanding common shares on a 10 old share for 1 new share basis and changed its
name to Corpus Resources Corporation. On June 23, 2009, the Company changed its name to NeoMedyx Medical Corporation and on February
24, 2010, changed its name to Blue Marble Media Corp. On December 8, 2011 the Company changed its name to KBridge Energy Corp.
All references to shares of common stock in this document refer to post split.
We
have not been involved in any bankruptcy, receivership or similar proceedings, nor have we been a party to any material reclassification,
merger, consolidation or purchase or sale of a significant amount of assets.
In
2004, the Company obtained an exclusive right to use patented biotechnology for the mass production of seed potatoes (potato microtubers)
under a license agreement with the Korea Research Institute of Bioscience and Biotechnology (KRIBB). The Company developed its
microtuber tissue culture at a laboratory leased from the Olds College Centre for Innovation
(OCCI), Alberta, Canada and in November
2004 terminated its lease with OCCI and relocated its seed potato operations to the city of Yanji located in Jilin Province and
to the city of Wuxi located in Yunnan Province, both located in The People’s Republic of China (PRC). The potato business was
discontinued in China during the 3rd quarter of 2005 due to a lack of funding and a down-shift in the demand for seed potatoes.
The seed plant operations are no longer in existence.
On
December 22, 2003, the Company agreed to acquire the license to manufacture, install and sell technology owned by Traffic-Its
Co., Ltd. The license provided the Company with the exclusive right to use the technology for the duration of the patent and to
commercially exploit the technology in Asia, Europe, and North America. Subsequent to December 31, 2003, the Company determined
the licensor had failed to comply with the terms of the agreement and cancelled the contract. After renewed negotiations, the
Company re-entered its agreement with Traffic-Its Co., Ltd. in 2004. During 2005 it was determined by management to be unfeasible
to continue operations and the project was discontinued during the 3rd quarter of 2005.
During
the fourth quarter of 2005, the Company officially abandoned all previous business activities.
During
the years 2006 and 2007 the Company actively sought opportunities to acquire mineral exploration properties. In 2007 management
of the Company reviewed a number of mineral concession opportunities in the People’s Republic of China. Ultimately, these opportunities
were deemed unsuitable for the Company at that time.
On
February 27, 2009, the Company entered an agreement with Biokhan Corporation (‘Biokhan’) whereby the Company would
acquire all of the outstanding shares of Biokhan effective January 2, 2009 for the issuance of 30,000,000 shares of common stock
of the Company. Biokhan manufactures, sells, imports and exports medical and dental devices - in particular, dental implant materials
and tools for dental implant operations. Biokhan failed to meet its financial commitments in the agreement and the acquisition
was terminated November 2009. During this period the Company entered into discussions and a due diligence phase for the acquisition
of Blue Cree Co Ltd., a company registered in the Republic of (South) Korea (‘Blue Cree’) and, effective January 2,
2010, the Company entered an agreement with Blue Cree whereby the Company would acquire all of the outstanding shares of Blue
Cree for the issuance of 20,000,000 shares of common stock of the Company. Blue Cree is in the business of providing integrated
commercial production services for television advertising, marketing, creative advertising and online promotion in South Korea
and overseas production using in house skilled specialists. However, in December 2010 the acquisition of Blue Cree was abandoned
due to the failure of both parties to meet their respective obligations under the agreement.
In
2011 the Company changed its name to KBridge Energy Corp. and began operations marketing resource based opportunities in North
America to customers based in Korea as a broker for energy and resource related contracts where the Company brought together the
energy/resource opportunity with the financing and continued developing this business.
B.
Business Overview
Between
2012 and 2013, the Company brokered contracts for Korean investors to invest in the revenue sector, specifically natural gas and
uranium.
During
2013, the Company continues to seek out both suitable energy resource opportunities and investor/customers with the objective
of matching the investor/customers’ funds with the resource assets.
During the year ended December 31, 2013, the
Company generated consulting
revenues of $1,187,523 by brokering a natural gas and a uranium exploration contracts for Korean investors.
The
Company requires additional financing in order to meet its anticipated working capital and acquisition cost.
Employees
The Company intends to use the services of contractors and consultants
for the administration of its projects. At present, in an effort to conserve cash and allow greater flexibility in the future,
we have no paid employees.
Government
Regulation
Our
business complies with all relevant laws.
C.
Organizational Structure
Upon
the closing of an acquisition KBridge will be the parent company of its operating subsidiary company.
D.
Property, Plant and Equipment
The
Company has no leased or owned property, plant or equipment.
ITEM
5 - Operating and Financial Review and Prospects
The
following discussion and analysis is based on and should be read in conjunction with the Company’s audited financial statements
including the notes thereto and other financial information appearing elsewhere herein. The audited financial statements have
been prepared using US dollars and are presented in accordance with accounting principles generally accepted in the United States.
A.
Operating Results
Year
comparison between 2013 and 2012
The
Company had net income of $196,407 for the year ended December 31, 2013 compared to net income of $206,142 in 2012. The net
income in 2013 reflects the Company generating $1,187,523 in consulting revenue compared to $461,040 in 2012.
B.
Liquidity and Capital Resources
Our
sources of liquidity are expected to be cash generated from operating activities and equity financing. The Company has cash
on hand as at December 31, 2013 in the amount of $22,164 (2012- $71,503). During the year ended December 31, 2013 the Company
had negative operating cash flow of $10,142 compared to positive operating cash flow of $82,738 in the previous year. In 2013,
the Company earned $1,187,523 in consulting fees (2012 - $461,040) primarily by introducing a potential uranium
supply (exploration stage) and an opportunity to secure natural gas supply to a Korean market. During the year ended December
31, 2013 the Company had positive cash flow from financing activities resulting from proceeds from loans payable of
$37,523.
In the comparable period, the Company had negative cash flow of $5,000 for payment of loans payable.
We
will require additional funding in order to develop business opportunities we determine to pursue. There can be no assurances
that financing, whether debt or equity, will be available to us in the amounts required at any particular time or for any particular
period or if available at all, or that it can be obtained on satisfactory terms. We have no arrangements in place with our officers,
directors or affiliates to provide liquidity to us.
We
anticipate that we will need to raise additional capital within the next twelve months in order to continue implementing our business
plan. We will need to raise the funds through debt or equity financing or a combination of both.
To the extent that additional capital is raised through the sale of equity or equity-related securities, the issuance of such
securities is likely to result in dilution to our shareholders. There can be no assurance that sources of capital will be available
to us on acceptable terms, or at all. If we are unable to raise additional capital, we may not be able to continue as a going
concern, and might have to reorganize under bankruptcy laws, liquidate, or enter into a business combination. If adequate funds
are not available within the next twelve months, we may be required to significantly curtail our operations or no longer be able
to operate.
C.
Research and development, patents and licenses etc.
We
do not currently and did not previously have research and development policies in place. Over the past two fiscal years, we have
expended zero amounts on research and development. We do not have any patents or licenses.
D.
Trend Information
We
are not aware as of the filing of this annual report of any known trends, uncertainties, demands, commitments or events that are
reasonably likely to have a material effect on our financial condition.
E.
Off-Balance Sheet Arrangements
We
have no off-balance sheet arrangements that would require disclosure.
F.
Tabular Disclosure of Contractual Obligations
During
the year ended December 31, 2013 the Company was not party to any contractually obligated payments.
G.
Safe Harbor
This
annual report contains forward-looking statements. We intend to identify forward-looking statements in this report using words
such as “anticipates”, “will”, “believes”, “plans”, “expects”, “future”,
“intends” or similar expressions. These statements are based on our beliefs as well as assumptions we made using information
currently available to us. Because these statements reflect our current views concerning future events, these statements involve
risks, uncertainties and assumptions. Actual future results may differ significantly from the results discussed in the forward-looking
statements. Some, but not all, of the factors that may cause these differences include those discussed in the Risk Factors section.
You should not place undue reliance on these forward-looking statements.
ITEM
6 - Directors, Senior Management and Employees
A.
Directors and Senior Management
The
following table sets forth the name, age, and position of each Director and Executive Officer of Kbridge Energy Corp.:
|
Name of Officer
|
|
Age
|
|
Office
|
|
Jai
Woo Lee
|
|
61
|
|
Director
and Chairman
Resigned
as
President
June
15,
2009
Appointed
Chairman
February
24,
2010
Appointed
President
December
30,
2010
Resigned
as
President
December
1,
2011
|
|
Taek Ryong Kim
|
|
52
|
|
President
and Director
Appointed
Director
December
1,
2011
Appointed
President
December
1,
2011
|
The
following summary outlines the professional background of the directors and executive officers of the Company.
Jai
Woo Lee, Chairman and former President
: Mr. Lee founded the Company to focus on the development and commercialization of
new technologies, and the identification and evaluation of commercially viable products and ventures. Mr. Lee studied at Seoul
National University, in Seoul, Korea. He moved from Korea to Canada in the 1970’s to establish his export business of live cattle
and beef, and his private company became a successful exporter of Canadian products to Korea.
Taek
Ryong Kim, President:
Mr Kim
received a bachelor’s degree in agriculture from Yanji University in July 1984. During
his career he has become knowledgeable in the areas of Foreign Trade, Agriculture, Economics and Technology. From October, 2002
to May, 2010 Mr Kim acted as President of Beijing Century Ltd, Beijing, China and from August, 1994 to October 2002 he worked
as a Manager for Yanji Foreign Economic & Trade Company, Tokyo, Japan. From May 2010 to the present he has been a self employed
consultant.
Arrangements
There
are no arrangements or understandings between our directors or executive officers and our major shareholders, customers, suppliers
or others pursuant to which any director or officer was or is to be selected as a director or officer. In addition, there are
no agreements or understandings for the officers or directors to resign at the request of another person and the above-named officers
and directors are not acting on behalf of nor acting at the direction of any other person.
B.
Compensation
Executive
Compensation
During the
year ended December 31, 2013, the Company incurred management fees of $97,420 (2012 - $nil; 2011 - $100,000) to the Chairman of
the Company for services rendered during the year.
The
amount of retirement and severance benefits accrued for our executive officers and directors in 2013, 2012 and 2011 was $nil.
There were no pension, retirement or other similar benefits set aside for our executive officers and directors in 2013, 2012, and
2011.
Compensation
of Directors
During
the years 2013, 2012, and 2011, there was $nil compensation paid to directors for their services as
directors.
Stock
Option Plan
The
Company currently does not have a stock option plan.
Under
our Articles of Incorporation, we may grant options for the purchase of our shares to certain qualified officers and employees.
C.
Board Practices
General
The
board of directors has the ultimate responsibility for the administration of the affairs of the Company. Our Articles of Incorporation,
as currently in effect, provides for a board of directors of not less than three directors and not more than ten directors. Under
our Articles, all directors serve a three-year term but may be replaced at the ordinary general meeting of shareholders convened
with respect to the last fiscal year. It is expected that all current directors will continue to serve the Company in the future.
The directors are elected at a general meeting of shareholders by a majority vote of the shareholders present or represented by
proxy, subject to minimum quorum requirements of at least one third of all issued and outstanding shares voting.
Currently
and from June 2006 to date no one has served or serves on the board as an independent director.
Committees
The
Company does not have an audit, compensation or remuneration committee. The entire board of directors serves these functions.
D.
Employees
Employment
Contracts with Employees and Officers
The
Company does not have any employment agreement with any employees, directors or officers.
E.
Share Ownership
The
following table sets forth certain information regarding the beneficial ownership of the common stock of the Company as of December
31, 2013 of: (a) each of the Company’s directors and officers, and (b) all directors and officers of the Company, as a group:
|
Director or Officer
|
|
Number of Common
Shares Owned
(1)
|
|
|
Percentage of
Outstanding
(%)
(1)(2)
|
|
|
Jai Woo Lee
|
|
|
6,821,674
|
|
|
|
46.97
|
|
|
Directors and Officers as a Group
|
|
|
6,821,674
|
|
|
|
46.97
|
|
Notes:
|
|
(1)
|
Shares of common stock subject to options or warrants currently exercisable, or exercisable within 60 days of December 31, 2013, are deemed outstanding for purposes of computing the percentage ownership of the person holding such option or warrants, but are not deemed outstanding for purposes of computing the percentage ownership of any other person.
|
|
|
(2)
|
Percentages are based on 14,522,727 shares of common stock issued and outstanding as of December 31, 2013 unless otherwise noted.
|
ITEM
7 - Major Shareholders and Related Party Transactions
A. Major
Shareholders
Table
of Major Shareholders
The following table sets forth information with respect to the beneficial ownership of our shares as
of December 31, 2013 by each person known to us to own beneficially more than five percent (5%) of our shares.
|
Identity of Person or Group
(1)
|
|
Total shares
beneficially owned
|
|
|
Percentage of total
shares
issued and
outstanding
(1)(2)
|
|
Citizenship
|
|
|
|
|
|
|
|
|
|
|
|
Jai Woo Lee
|
|
|
6,821,674
|
|
|
46.97
|
|
Korea
|
|
Yun Kwan Choi
|
|
|
2,000,000
|
|
|
13.77
|
|
Korea
|
|
Kwon Jung Soo
|
|
|
2,000,000
|
|
|
13.77
|
|
Korea
|
Notes:
|
|
(1)
|
Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Shares of common stock subject to options or warrants currently exercisable or exercisable within 60 days of December 31, 2013 are deemed outstanding for purposes of computing the percentage ownership of the person holding such option or warrants, but are not deemed outstanding for purposes of computing the percentage ownership of any other person.
|
|
|
(2)
|
Percentages are based on 14,522,727 common shares issued and outstanding as of December 31, 2013 unless otherwise noted.
|
Changes
in Ownership Percentage
The
following table shows changes over the last four years in the percentage of the issued share capital for the Group held by major
shareholders, either directly or by virtue of ownership of our common shares at December 31 of each year.
|
Identity of Person or Group
(1)
|
|
|
2013
|
|
|
|
2012
(1)(2)
|
|
|
2011
(1)(2)
|
|
2010
(1)(2)
|
|
2009
(1)(2)
|
|
|
|
|
%
|
|
|
|
%
|
|
|
%
|
|
%
|
|
%
|
|
Jai Woo Lee
|
|
|
46.97
|
|
|
|
46.97
|
|
|
46.97
|
|
46.97
|
|
24.63
|
|
Hye Kyung Lee
(3)(4)
|
|
|
1.08
|
|
|
|
1.08
|
|
|
1.08
|
|
1.08
|
|
3.14
|
|
Sun Joo Choi
|
|
|
2.75
|
|
|
|
2.75
|
|
|
2.75
|
|
2.75
|
|
0.99
|
|
CDS & Co.
|
|
|
15.29
|
|
|
|
15.29
|
|
|
15.29
|
|
15.29
|
|
5.48
|
|
Yun Kwan Choi
|
|
|
13.77
|
|
|
|
13.77
|
|
|
13.77
|
|
13.77
|
|
6.56
|
|
Kwon Jung Soo
|
|
|
13.77
|
|
|
|
13.77
|
|
|
13.77
|
|
13.77
|
|
6.56
|
Notes:
|
|
(1)
|
Beneficial ownership is determined in accordance with the rules of the SEC and
generally includes voting or investment power with respect to securities. Shares of common stock subject to options or
warrants currently exercisable or exercisable within 60 days, are deemed outstanding for purposes of computing the percentage
ownership of the person holding such option or warrants, but are not deemed outstanding for purposes of computing the percentage ownership of any other person.
|
|
|
(2)
|
Percentages are based on:
14,522,727 common shares issued and outstanding as of December 31, 2013:
14,522,727 common shares issued and outstanding as of December 31, 2012:
14,522,727 common shares issued and outstanding as of December 31, 2011:
14,522,727 common shares issued and outstanding as of December 31, 2010:
30,472,727 common shares issued and outstanding as of December 31, 2009:
|
|
|
(3)
|
Includes 156,213 common shares of the Company held by Penn Capital Canada Ltd., a private company controlled by Hye Kyung Lee.
|
|
|
(4)
|
Ms. Lee changed her last name in 2007 from Kim to Lee.
|
With
the exception of the above-noted transactions, there has not been a significant change in the ownership percentage held by any
major shareholders during the past four years.
Voting
Rights
Our
major shareholders do not have any different voting rights than other shareholders.
Corporate
or Foreign Government Ownership
We
are not controlled directly or indirectly by any other corporation or any other foreign government or by any other natural or
legal person, severally or jointly.
Geographic
Breakdown of Shareholders
The
following lists the geographical distribution of shareholders at December 31, 2013:
|
|
|
|
Number of
registered
|
|
|
|
Number of
|
|
|
Location
|
|
|
shareholders
|
|
|
|
shares
|
|
|
Canada
|
|
|
38
|
|
|
|
242,214
|
|
|
United States
|
|
|
2
|
|
|
|
8,000
|
|
|
Cede & Co
|
|
|
1
|
|
|
|
2,221,033
|
|
|
Other
|
|
|
16
|
|
|
|
12,051,480
|
|
|
Total
|
|
|
57
|
|
|
|
14,522,727
|
|
Shares
registered in intermediaries were assumed to be held by residents of the same country in which the clearing-house was located.
Change
of Control
There
are no arrangements for which, through their operation at a subsequent date, may result in a change in control of the Company.
B.
Related Party Transactions
During
the fiscal years ended December 31, 2013 and 2012 the following amounts were incurred by us under related party transactions:
As at December
31, 2013, the Company owed $113,734 (2012 - $115,139) to the Chairman of the Company which is non-interest bearing, unsecured,
and due on demand.
During the
year ended December 31, 2013, the Company incurred management fees of $97,420 (2012 - $nil) to the Chairman of
the Company for services rendered during the year.
In
the event conflicts between the Company and its related parties arise, the Company will attempt to resolve any such conflicts
of interest in favor of the Company. The officers and directors of the Company are accountable to the Company and its shareholders
as fiduciaries, which require that such officers and directors exercise good faith and integrity in handling the Company’s affairs.
A shareholder may be able to institute legal action on behalf of the Company on behalf of that shareholder and all other similarly
situated shareholders to recover damages or for other relief in cases of the resolution of conflicts in any manner prejudicial
to the Company.
C.
Interests of Experts and Counsel
Not
required, as this form 20-F filing is made as an annual report.
ITEM
8 - Financial Information
A.
Statements and Other Financial Information
Financial
Statements
The
following financial statements of the Company have been included in Item 18, as audited by an independent auditor and accompanied
by an audit report, as of December 31, 2013 and 2012 and for the years then ended:
|
|
●
|
Statements
of operations;
|
|
|
●
|
Statements
of stockholders’ equity(deficit);
|
|
|
●
|
Statements
of cash flows; and
|
|
|
●
|
Notes to the financial statements.
|
Legal Proceedings
The
Company is not involved in any litigation or legal proceedings and to its knowledge, no material legal proceedings involving is
to be initiated against the Company.
Dividends
The
Company has never paid any dividends and does not intend to pay any dividends in the near future.
B.
Significant Changes
There
has been no significant change in the Company’s affairs since the December 31, 2013 financial statements.
ITEM
9 - The Offer and Listing
A.
Offer and Listing Details
The
shares of common stock of the Company are quoted by FINRA on the OTCBB under the symbol BMMCF. The following sets forth the high
and low closing prices in United States funds of our common shares quoted on the OTCBB for the past five years:
|
Year
Ended
|
|
High
|
|
Low
|
|
December 31,
2009
|
|
US$
|
0.65
|
|
US$
|
0.0200
|
|
December 31,
2010
|
|
US$
|
0.51
|
|
US$
|
0.0130
|
|
December 31,
2011
|
|
US$
|
0.03
|
|
US$
|
0.0021
|
|
December 31,
2012
|
|
US$
|
0.00
|
|
US$
|
0.0011
|
|
December 31,
2013
|
|
US$
|
0.29
|
|
US$
|
0.0011
|
C. Plan
of Distribution
Not required,
as this form 20-F filing is made as an annual report.
D. Markets
The
shares of the common stock of the Company have been quoted on the OTCBB since May 27, 2003. No trades in our common shares occurred
on the OTCBB market prior to November 3, 2003.
E.
Selling Shareholders
Not
required, as this form 20-F filing is made as an annual report.
F.
Dilution
Not
required, as this form 20-F filing is made as an annual report.
G.
Expenses of the Issue
Not
required, as this form 20-F filing is made as an annual report.
ITEM
10 - Additional Information
A.
Share Capital
The
Company’s authorized capital consists of unlimited common shares without par value and unlimited preferred shares without
par value. As at December 31, 2013 and May 13, 2014, the Company had 14,522,727 common shares issued and outstanding.
No
shares were issued during the years ended December 31, 2011, 2012 and 2013.
B.
Bylaws and Articles of Association
Our
Articles of Incorporation and Bylaws of the Company are incorporated by reference to certain exhibits to our Form F-1 registration
statement filed with the Securities and Exchange Commission on May 27, 2003.
C.
Material Contracts
None
D.
Exchange Controls and other Limitations Affecting Security Holders
There
currently are no laws, decrees, regulations or other legislation in Canada that restricts the export or import of capital or that
affects the remittance of dividends, interest or other payments to non-resident holders of the Company’s securities, other than
withholding tax requirements.
There
is no limitation, imposed either by Canadian law or by the Articles of Incorporation and other charter documents of the Company,
on the right of a non-resident to hold voting shares of the Company, other than as provided by the Investment Canada Act as amended
(the “Act”) and as amended by the North American Free Trade Agreement Implementation Act (Canada) and the World Trade
Organization (WTO) Agreement Implementation Act. The Act requires notification and, in certain cases, advance review and approval
by the Government of Canada of the acquisition by a “non-Canadian” of “control of a Canadian business,” all
as defined in the Act.
Generally, the threshold for review will be higher in monetary terms for a member of the WTO or NAFTA.
E.
Taxation
United
States and Canada: there are reciprocal tax treaties between Canada and the United States. Potential purchasers are urged to consult
their tax advisors as to the particular consequences to them under U.S. federal, state, local and applicable foreign tax laws
of the acquisition, ownership and disposition of common shares.
F.
Dividends and Paying Agents
Not
required, as this 20-F filing is made as an annual report.
G.
Statement by Experts
Not
required, as this 20-F filing is made as an annual report.
H.
Documents on Display
You
may review a copy of the Company’s filings with the SEC, including exhibits and schedules filed with it, in the SEC’s Public Reference
Room at 100 F Street NE, Washington, D.C. 20549. You may call the SEC at 1-800-SEC-0330 or the Conventional Reading Rooms’ Headquarters
Office at 212-551-8090 for further information on the public reference rooms. The SEC maintains a web site (www.sec.gov) that
contains reports, proxy and information statements and other information regarding registrants that file electronically with the
SEC.
I.
Subsidiary Information
As
at December 31, 2013, the Company does not have any subsidiary companies.
ITEM
11 - Quantitative and Qualitative Disclosures about Market Risk
Transaction
Risk and Currency Risk Management
We
are subject to market risk exposures due to fluctuations in exchange rates and interest rates. Changes in the foreign exchange
rate between the CDN$ and the US$ may affect us due to the effect of such changes on any shareholder distributions to the shareholders
using US$ as a main currency. The Company denominates its financial statements in United States dollars but conducts its daily
affairs in Canadian dollars. We are not currently carrying significant amounts of short term or long-term debt. Upward fluctuations
in interest rates increase the cost of additional debt and the interest cost of outstanding floating rate borrowings.
Inflation
We
do not consider that inflation in Canada has had a material impact on our results of operations. Inflation in Canada in 2008,
2009, 2010, 2011, 2012, and 2013 was: 2.4%, 1.3%, 2.3%, 2,9%, 1,9%, 1.1% and respectively.
ITEM
12 - Descriptions of Securities Other than Equity Securities
Not
required, as this 20-F filing is made as an annual report.
PART
III
ITEM
17 - Financial Statements
See “Item
18 - Financial Statements.”
ITEM
18 - Financial Statements
KBRIDGE
ENERGY CORP.
Financial
statements
December 31,
2013
(Expressed
in U.S. Dollars)
|
|
|
Index
|
|
|
|
|
|
Report
of Independent Registered Public Accounting Firm
|
|
21
|
|
|
|
|
|
Balance
sheets
|
|
22
|
|
|
|
|
|
Statements of operations
|
|
23
|
|
|
|
|
|
Statements
of stockholders’ equity (deficit)
|
|
24
|
|
|
|
|
|
Statements
of cash flows
|
|
25
|
|
|
|
|
|
Notes
to the financial statements
|
|
26
|
![[LOGO]](http://content.edgar-online.com/edgar_conv_img/2014/05/15/0001273511-14-000077_KBE001_V1.JPG)
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board
of Directors and Stockholders of
Kbridge Energy
Corp.
We
have audited the accompanying balance sheets of Kbridge Energy Corp. (the “Company”) as of December 31, 2013 and 2012,
and the related statements of operations, stockholders’ equity (deficit), and cash flows for the years then ended. These
financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We
conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. The Company is not required to have, nor were we engaged to perform, an audit of its internal control
over financial reporting. An audit includes consideration of internal control over financial reporting as a basis for designing
audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In
our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the
Company as of December 31, 2013 and 2012, and the results of its operations and its cash flows for the years then ended, in conformity
with accounting principles generally accepted in the United States.
The
accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note
1 to the financial statements, the Company has an accumulated deficit since inception. These factors raise substantial doubt about
the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also discussed
in Note 1 to the financial statements. The financial statements do not include any adjustments that might result from the outcome
of this uncertainty.
/s/ SATURNA GROUP CHARTERED
ACCOUNTANTS LLP
Saturna Group
Chartered Accountants LLP
Vancouver,
Canada
May 9, 2014
KBRIDGE
ENERGY CORP.
Balance sheets
(Expressed
in U.S. Dollars)
|
|
|
December 31,
2013
$
|
|
December 31,
2012
$
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
|
|
|
22,164
|
|
|
|
71,503
|
|
|
Marketable securities (Note 3)
|
|
|
166,219
|
|
|
|
–
|
|
|
Accounts receivable
|
|
|
92,569
|
|
|
|
–
|
|
|
Prepaid expenses
|
|
|
36,818
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
317,770
|
|
|
|
71,503
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities (Note 4)
|
|
|
89,130
|
|
|
|
97,373
|
|
|
Loan payable (Note 5)
|
|
|
37,608
|
|
|
|
–
|
|
|
Due to related party (Note 6)
|
|
|
113,734
|
|
|
|
115,139
|
|
|
Deferred revenue
|
|
|
–
|
|
|
|
67,599
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
240,472
|
|
|
|
280,111
|
|
|
|
|
|
|
|
|
|
|
|
|
Nature of operations and continuance of business (Note 1)
|
|
|
|
|
|
|
|
|
|
Commitments (Note 7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity (deficit)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock
Authorized: unlimited preferred shares without par value
Issued: nil preferred shares
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
Common stock
Authorized: unlimited common shares without par value
Issued and outstanding common shares: 14,522,727 shares
|
|
|
2,358,954
|
|
|
|
2,358,954
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional paid-in capital
|
|
|
9,527
|
|
|
|
9,527
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated other comprehensive income (loss)
|
|
|
1,236
|
|
|
|
(88,263
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
(2,292,419
|
)
|
|
|
(2,488,826
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders’ equity (deficit)
|
|
|
77,298
|
|
|
|
(208,608
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders’ equity (deficit)
|
|
|
317,770
|
|
|
|
71,503
|
|
(The accompanying
notes are an integral part of these financial statements)
KBRIDGE
ENERGY CORP.
Statements
of operations
(Expressed
in U.S. dollars)
|
|
|
Year ended
December 31,
2013
$
|
|
Year ended
December 31,
2012
$
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
1,187,523
|
|
|
|
461,040
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Administration fees
|
|
|
327,473
|
|
|
|
–
|
|
|
Amortization
|
|
|
–
|
|
|
|
1,391
|
|
|
Consulting fees
|
|
|
283,851
|
|
|
|
86,116
|
|
|
Foreign exchange loss
|
|
|
1,110
|
|
|
|
11,753
|
|
|
Investor relations
|
|
|
22,424
|
|
|
|
6,520
|
|
|
Management fees (Note 6)
|
|
|
97,420
|
|
|
|
–
|
|
|
Office and miscellaneous
|
|
|
60,502
|
|
|
|
63,184
|
|
|
Professional fees
|
|
|
29,627
|
|
|
|
13,841
|
|
|
Travel
|
|
|
168,709
|
|
|
|
65,342
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
|
|
|
991,116
|
|
|
|
248,147
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before other expense
|
|
|
196,407
|
|
|
|
212,893
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on disposal of property and equipment
|
|
|
–
|
|
|
|
(6,751
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net income for the year
|
|
|
196,407
|
|
|
|
206,142
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share, basic and diluted
|
|
|
0.01
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding
|
|
|
14,522,727
|
|
|
|
14,522,727
|
|
(The accompanying
notes are an integral part of these financial statements)
KBRIDGE
ENERGY CORP.
Statements
of stockholders’ equity (deficit)
(Expressed
in U.S. dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
|
other
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock
|
|
|
|
paid-in
|
|
|
|
comprehensive
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount
|
|
|
|
capital
|
|
|
|
income
(loss)
|
|
|
|
Deficit
|
|
|
|
Total
|
|
|
|
|
|
Number
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2011
|
|
|
14,522,727
|
|
|
|
2,358,954
|
|
|
|
9,527
|
|
|
|
(88,263
|
)
|
|
|
(2,694,968
|
)
|
|
|
(414,750
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income for the year
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
206,142
|
|
|
|
206,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2012
|
|
|
14,522,727
|
|
|
|
2,358,954
|
|
|
|
9,527
|
|
|
|
(88,263
|
)
|
|
|
(2,488,826
|
)
|
|
|
(208,608
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain on marketable securities
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
89,499
|
|
|
|
–
|
|
|
|
89,499
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income for the year
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
–
|
|
|
|
196,407
|
|
|
|
196,407
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2013
|
|
|
14,522,727
|
|
|
|
2,358,954
|
|
|
|
9,527
|
|
|
|
1,236
|
|
|
|
(2,292,419
|
)
|
|
|
77,298
|
|
(The accompanying
notes are an integral part of these financial statements)
KBRIDGE
ENERGY CORP.
Statements
of cash flows
(Expressed
in U.S. dollars)
|
|
|
Year ended
December 31,
2013
$
|
|
Year ended
December 31,
2012
$
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income for the year
|
|
|
196,407
|
|
|
|
206,142
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
|
|
Amortization
|
|
|
–
|
|
|
|
1,391
|
|
|
Foreign exchange translation loss
|
|
|
85
|
|
|
|
–
|
|
|
Loss on disposal of property and equipment
|
|
|
–
|
|
|
|
6,751
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
(92,569
|
)
|
|
|
–
|
|
|
Prepaid expenses
|
|
|
(36,818
|
)
|
|
|
–
|
|
|
Accounts payable and accrued liabilities
|
|
|
(8,243
|
)
|
|
|
26,817
|
|
|
Due to related party
|
|
|
(1,405
|
)
|
|
|
(225,962
|
)
|
|
Deferred revenue
|
|
|
(67,599
|
)
|
|
|
67,599
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) operating activities
|
|
|
(10,142
|
)
|
|
|
82,738
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of marketable securities
|
|
|
(76,720
|
)
|
|
|
–
|
|
|
Purchase of property and equipment
|
|
|
–
|
|
|
|
(22,875
|
)
|
|
Proceeds from disposal of property and equipment
|
|
|
–
|
|
|
|
14,733
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
|
(76,720
|
)
|
|
|
(8,142
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from loans payable
|
|
|
37,523
|
|
|
|
–
|
|
|
Repayments of loans payable
|
|
|
–
|
|
|
|
(5,000
|
)
|
|
Advances from related parties
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
37,523
|
|
|
|
(5,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Change in cash
|
|
|
(49,339
|
)
|
|
|
69,596
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, beginning of year
|
|
|
71,503
|
|
|
|
1,907
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, end of year
|
|
|
22,164
|
|
|
|
71,503
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income taxes paid
|
|
|
–
|
|
|
|
–
|
|
|
Interest paid
|
|
|
–
|
|
|
|
–
|
|
(The accompanying
notes are an integral part of these financial statements)
KBRIDGE
ENERGY CORP.
Notes
to the financial statements
December
31, 2013
(Expressed
in U.S. dollars)
|
|
1.
|
Nature
of Operations and Continuance of Business
|
Kbridge
Energy Corp. (the “Company”) was incorporated under the laws of British Columbia, Canada, on October 23, 2002 as Penn
Biotech Inc. On January 13, 2005, the Company changed its name from to United Traffic System Inc. On November 30, 2007, the Company
changed its name to Corpus Resources Corporation. On June 23, 2009, the Company changed its name to NeoMedyx Medical Corp. On
February 24, 2010, the Company changed its name to Blue Marble Media Corp. On December 8, 2011, the Company changed its name to
Kbridge Energy Corp. The Company was considered a development stage company during the year ended December 31, 2012 as defined
by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 915, “Development
Stage Entities”. As a development stage company, the Company disclosed the deficit accumulated during the development stage
and the cumulative statements of operations and cash flows from inception to the current balance sheet date. A entity remains
in the development stage until such time as, among other factors, significant revenues have been generated. During the year ended
December 31, 2013, the Company generated significant revenues from operations and has the expectation to continue recognizing
revenues from operations. As at and for the year ended December 31, 2013, the Company ceased to be a development stage company.
The Company’s current business is providing consulting services in the resource sector.
These
financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets
and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent
upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to
continue operations, and the attainment of profitable operations. As at December 31, 2013, the Company has an accumulated deficit
of $2,292,419 since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going
concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset
amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
|
|
2.
|
Summary
of Significant Accounting Policies
|
|
|
(a)
|
Basis
of Presentation
|
These
financial statements and related notes are presented in accordance with accounting principles generally accepted in the United
States and are expressed in U.S. dollars.
The
preparation of financial statements in accordance with United States generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements
and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions
related to the fair value of marketable securities, allowance for doubtful accounts, and deferred income tax asset valuation allowances.
The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes
to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of
assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results
experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material
differences between the estimates and the actual results, future results of operations will be affected.
KBRIDGE
ENERGY CORP.
Notes
to the financial statements
December
31, 2013
(Expressed
in U.S. dollars)
|
|
2.
|
Summary
of Significant Accounting Policies (continued)
|
|
|
(c)
|
Cash
and Cash Equivalents
|
The
Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.
The
Company recognizes allowances for doubtful accounts to ensure accounts receivable are not overstated due to the inability or unwillingness
of its customers to make required payments. The allowance is based on the age of receivable and the specific identification of
receivables the Company considers at risk.
The
Company derives revenue primarily by providing consulting services. In accordance with ASC 605, “Revenue Recognition”,
revenue is recognized when persuasive evidence of an arrangement exists, the services have been rendered, the amount is fixed
and determinable, and collection is reasonably assured. Customer advances are deferred and recognized as revenue when the Company
has completed all of its performance obligations relating to the consulting services.
The
Company accounts for income taxes using the asset and liability method in accordance with ASC 740, “Accounting for Income
Taxes”. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected
future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and
for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted
tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance
to reduce deferred tax assets to the amount that is believed more likely than not to be realized.
As
of December 31, 2013 and 2012, the Company did not have any amounts recorded pertaining to uncertain tax positions.
The
Company files federal and provincial income tax returns in Canada. The Company may be subject to a reassessment of federal and
provincial income taxes by Canadian tax authorities for a period of three years from the date of the original notice of assessment
in respect of any particular taxation year. The open taxation years range from 2010 to 2012. Tax authorities of Canada have not
audited any of the Company’s income tax returns for the open taxation years noted above.
The
Company recognizes interest and penalties related to uncertain tax positions in tax expense. During the years ended December 31,
2013 and 2012, there were no charges for interest or penalties.
|
|
(g)
|
Stock-based
Compensation
|
The
Company records stock-based compensation in accordance with ASC 718, “Compensation – Stock Compensation” and ASC
505, “Equity Based Payments to Non-Employees”
,
using the fair value method. All transactions in which goods or
services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the
consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.
KBRIDGE
ENERGY CORP.
Notes
to the financial statements
December
31, 2013
(Expressed
in U.S. dollars)
|
|
2.
|
Summary
of Significant Accounting Policies (continued)
|
|
|
(h)
|
Foreign
Currency Translation
|
The
Company’s functional and reporting currency is the United States dollar. Management has adopted ASC 830, “Foreign Currency
Matters”. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing
at the balance sheet date. Non-monetary assets and liabilities denominated in foreign currencies are translated at rates of exchange
in effect at the date of the transaction. Average monthly rates are used to translate revenues and expenses. Gains and losses
arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination
of income.
ASC
220, “Comprehensive Income” establishes standards for the reporting and display of comprehensive loss and its components
in the consolidated financial statements. As at December 31, 2013 and 2012, the Company has no items that represent comprehensive
loss.
|
|
(j)
|
Financial
Instruments
|
ASC
820, “Fair Value Measurements and Disclosures” requires an entity to maximize the use of observable inputs and minimize
the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent,
objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the
fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes
the inputs into three levels that may be used to measure fair value:
Level
1
Level
1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.
Level
2
Level
2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability
such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in
markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant
inputs are observable or can be derived principally from, or corroborated by, observable market data.
Level
3
Level
3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to
the measurement of the fair value of the assets or liabilities.
The
Company’s financial instruments consist principally of cash, marketable securities, accounts receivable, accounts payable
and accrued liabilities, loan payable, and amounts due to a related party. Pursuant to ASC 820, the fair value of cash and marketable
securities are determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical
assets. The recorded values of all other financial instruments approximate their current fair values because of their nature and
respective maturity dates or durations.
KBRIDGE
ENERGY CORP.
Notes
to the financial statements
December
31, 2013
(Expressed
in U.S. dollars)
|
|
2.
|
Summary
of Significant Accounting Policies (continued)
|
The
Company computes loss per share in accordance with ASC 260, “Earnings per Share”. ASC 260 requires presentation of both
basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing earnings (loss)
available to common shareholders (numerator) by the weighted average number of common shares outstanding (denominator) during
the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury
stock method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed
to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential common shares if their
effect is anti-dilutive.
|
|
(l)
|
Recent
Accounting
Pronouncements
|
The
Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and
does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact
on its financial position or results of operations.
As
at December 31, 2013, the Company held 1,360,000 (2012 – nil) common shares of Plate Resources Inc. with an original cost
of $76,721 (Cdn$81,600) and a fair value of $166,219 (Cdn$176,800) (2012 - $nil). Management estimated the fair value of the shares
using the quoted market price on the TSX Venture Exchange.
|
|
4.
|
Accounts
Payable and Accrued Liabilities
|
|
|
|
2013
$
|
|
2012
$
|
|
|
|
|
|
|
|
|
|
|
|
Trade payables
|
|
|
81,616
|
|
|
|
90,319
|
|
|
GST payable
|
|
|
7,514
|
|
|
|
7,054
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
89,130
|
|
|
|
97,373
|
|
As
at December 31, 2013, the Company owed $37,608 (Cdn$40,000) (2012 - $nil) to an unrelated party, which is non-interest bearing,
unsecured, and due on demand.
|
|
6.
|
Related
Party
Transactions
|
|
|
(a)
|
As
at December 31, 2013, the Company owed $113,734 (2012 - $115,139) to the Chairman of the Company which is non-interest bearing,
unsecured, and due on demand.
|
|
|
(b)
|
During
the year ended December 31, 2013, the Company incurred management fees of $97,420 (2012 - $nil) to the Chairman of the Company.
|
KBRIDGE
ENERGY CORP.
Notes
to the financial statements
December
31, 2013
(Expressed
in U.S. dollars)
|
|
(a)
|
On
April 1, 2013, the Company entered into a consulting agreement. Pursuant to the agreement, the Company will pay the consultant
$4,570 (5,000,000 Korean Won) per month and reimbursements for approved expenses incurred for consulting services provided for
a period of one year.
|
|
|
(b)
|
On
September 10, 2013, the Company entered into a premises lease agreement for a term of one year, whereby the Company is required
to pay $2,285 (2,500,000 Korean Won) per month.
|
|
|
(c)
|
On
October
1,
2013,
the
Company
entered
into
an
agreement
whereby
the
Company
will
pay
the
consultant
$9,258
(Cdn$10,000)
per
month
for
services
provided
for
a
period
of
one
year.
The
agreement
may
be
renewed
on
a
yearly
basis
after
the
initial
term.
|
The
Company has non-capital losses carried forward of $1,953,967 available to offset taxable income in future years which expires
beginning in fiscal 2014.
The
Company is subject to Canadian federal and provincial income taxes at a combined rate of 25.75% (2012 - 25%). The reconciliation
of the provision for income taxes at the combined Canadian federal and provincial statutory rate compared to the Company’s
income tax expense as reported is as follows:
|
|
|
2013
$
|
|
2012
$
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense at statutory rate
|
|
|
50,575
|
|
|
|
51,536
|
|
|
|
|
|
|
|
|
|
|
|
|
Permanent differences
|
|
|
11,762
|
|
|
|
4,641
|
|
|
Changes in enacted tax rates
|
|
|
(21,355
|
)
|
|
|
–
|
|
|
Change in valuation allowance
|
|
|
(40,982
|
)
|
|
|
(56,177
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes
|
|
|
–
|
|
|
|
–
|
|
The
significant components of deferred income tax assets and liabilities at December 31, 2013 and 2012, are as follows:
|
|
|
2013
$
|
|
2012
$
|
|
|
|
|
|
|
|
|
|
|
|
Non-capital losses carried forward
|
|
|
508,031
|
|
|
|
549,013
|
|
|
|
|
|
|
|
|
|
|
|
|
Valuation allowance
|
|
|
(508,031
|
)
|
|
|
(549,013
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred income tax asset
|
|
|
–
|
|
|
|
–
|
|
ITEM
19 - Exhibits
The
following exhibits are included herein, except for the exhibits marked with an asterisk, which are incorporated herein by reference
.
Exhibit
No.
|
|
Exhibit Title
|
|
|
1.1*
|
|
Notice
of Articles
|
|
1.2*
|
|
Transition
Notice
|
|
1.3*
|
|
Articles
|
|
1.4*
|
|
Articles
of Amendment
|
|
12.1
|
|
Certification
of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
|
|
12.2
|
|
Certification
of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
|
|
13.1
|
|
Certification
of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
|
*previously
filed