ITEM 1. BUSINESS
Our Company, Millennium Energy Corp., was incorporated in the State of Nevada on June 28, 2006. The Company is a development stage company as defined by Statement of Financial Accounting Standard (“SFAS”) No. 7 “Accounting and Reporting for Development Stage Enterprises”. On November 29, 2007, the Company completed a merger with its wholly-owned subsidiary, CBp Carbon Green, Inc., which was incorporated in the State of Nevada on November 7, 2007, solely to effect a name change. As a result, the Company changed its name from Shopper’s Wallet, Inc. to CBp Carbon Green, Inc. In addition, on March 26, 2008, the Company completed a merger with its wholly-owned subsidiary, Millennium Energy Corp., which was incorporated in the State of Nevada on February 22, 2008, solely to effect a name change. As a result, the Company changed its name from CBp Carbon Green, Inc. to Millennium Energy Corp. The Company’s common shares are now listed for trading on the OTC Bulletin Board under the symbol “MLME”.
From June, 2006, to November, 2007, we were focused on offering interactive English language training courses specifically designed for adults studying English as a second language. Our product, the course content, which was expected to be available both on-line and in DVD media format, expected to cover English phonetics, grammar, pronunciation, spoken English, vocabulary and learning games. We had planned to develop our product with animation graphics and interactive capabilities. It was our goal to offer our product both online and through the direct sale of DVD products. Our target market was the non-native, English adult students interested in improving their language skills. The content of our products was expected to include:
(i)
Video dialogues;
(ii)
Audio scripts (for videos);
(iii)
Clickable words and pictures;
(iv)
Text and audio definitions; and
(v)
Engaging, interactive learning activities.
We had anticipated that once we set-up our website, our customers would be able to access our language training course either through a DVD purchase or their password protected account on our website.
However, in November of 2007, we had a change of control of the Company and expected to change the business direction of the Company from interactive English language training courses to receiving a license of pyrolysis technology from Ariana Intervest Ltd., which technology had been licensed by CBp Carbon Industries, Inc. (a non-related company) under previous agreement with the patent holder. However, CBp Carbon Industries, Inc. later advised that it did not consent to the license of the pyrolysis technology from Ariana Intervest Ltd. to the Company and did not permit the use of the CBp name by the Company. Therefore, in March of 2008, the Company effected a name change to Millennium Energy Corp. in order to more closely reflect the new business direction of the Company, which is uranium exploration.
We have commenced only limited operations, primarily focused on organizational matters. We have never declared bankruptcy, have never been in receivership, and have never been involved in any legal action or proceedings. Except as addressed below, we have not made any significant purchase or sale of assets. Our President and CEO has no experience in the business of uranium exploration, however, she intends to engage qualified consultants and geologists to assist the Company with its anticipated uranium exploration activities.
On June 26, 2008, the Company entered into a Mineral Property Use and Exploitation Rights Agreement (the “Agreement”) with Central European Metals S.R.O. (“CEM”), a company incorporated in Slovakia. Pursuant to the Agreement the Company has acquired a 100% undivided interest (subject to a 1% net refining return royalty) in a certain uranium mineral property named Spišské Vlachy - U, Mo, Cu ores located in the North Gemeric Permian Belt in Eastern Slovakia and encompassing an area of 41.4 square kilometers (the “Property”). The exclusive right acquired by the Company is for a duration of 25 years commencing June 30, 2008. As consideration for its 100% undivided interest granted under the Agreement, the Company is require to issue a total of 20,000,000 restricted shares of Common Stock of the Company to CEM within 90 days of this Agreement, which shares were issued on September 22, 2008. In addition, the Company must incur at least €5,000,000 (Euros) of Expenditures, as that term is defined in the Agreement, on the Property on or before July 5, 2013, and must ensure that all governmental and regulatory fees associated with the Property are kept in good standing, including, but not limited to all necessary leases or permits, taxes, and rentals, during the term. Millennium shall have the option to renew the rights granted under the Agreement for an additional 25 year period after the initial term upon the issuance of an additional 10,000,000 restricted shares of Common Stock of the Company to CEM on or before 30 days prior to the end of the initial 25 year term. A copy of this Agreement is attached as Exhibit 10.1 to the Company’s quarterly report filed on August 13, 2008, and is incorporated herein by reference.
We do not currently have sufficient capital to operate our business and we will require additional funding in the future to sustain our operations. There is no assurance that we will ever have revenue in the future or that we will be able to secure the necessary funding to develop our business.
We are an exploration stage corporation. An exploration stage corporation is one engaged in the search for mineral deposits or reserves which are not in either the development or production stage. We intend to focus our exploration activities on uranium mineral properties in various regions around the globe. We maintain our statutory registered agent’s office at Eastbiz.com Inc. of 5348 Vegas Dr., Las Vegas, NV 89108 and our corporate office is located at 43 Pireos St., Ano Voula, Athens, Greece. Our telephone number is 011-30-210-895-8786.
We have no plans to change our business activities from mineral exploration. In addition, we intend to explore mineral properties in various regions around the globe and this may result in the acquisition of other entities that own certain mineral rights or licenses.
Principal Products
At this time we do not have any product for sale as we are in the beginning stages of our exploration and development of the uranium mineral property to which we have acquired the exclusive use and exploitation rights.
Competition
While we compete with other exploration companies in the effort to locate and acquire mineral resource properties, we may not be able to compete with them for the removal or sales of mineral products from any potential mineral property or license to which we have rights or may be able to acquire if we should eventually discover the presence of them in quantities sufficient to make production economically feasible. Markets exist worldwide for the sale of mineral products and we will likely be able to sell any mineral products that we identify and produce.
In identifying and acquiring mineral resource properties, we compete with many companies possessing greater financial resources and technical facilities. Competition could adversely affect our ability to acquire suitable prospects for exploration in the future.
Licenses
Our development and exploration activities in Slovakia require permits from various government authorities, and are subject to extensive federal, state and local laws and regulations governing prospecting, development, production, exports, taxes, labour standards, occupational health and safety, mine safety and other matters. Such laws and regulations are subject to change, can become more stringent and compliance can therefore become more costly.
We believe that we hold or have the rights to all necessary licences and permits under applicable laws and regulations and believe we are presently complying in all material respects with the terms of such licences and permits. However, such licences and permits are subject to change in various circumstances. There can be no guarantee that we will be able to maintain or obtain all necessary licences and permits that may be required to explore and develop our current property, commence construction or continue operation of mining facilities.
We believe that title to our current property is in good standing, however, this should not be construed as a guarantee of title to such property.
Environmental Laws
Environmental legislation will affect nearly all aspects of our operations. Compliance with environmental legislation can require significant expenditures and failure to comply with environmental legislation may result in the imposition of fines and penalties, clean up costs arising out of contaminated properties, damages and the loss of important permits.
Environmental laws and regulations are evolving in all jurisdictions. We are not able to determine the specific impact that future changes in environmental laws and regulations may have on our operations and activities, and its resulting financial position; however, we anticipate that capital expenditures and operating expenses may increase in the future as a result of the implementation of new and increasingly stringent environmental regulation. Further changes in environmental laws, new information on existing environmental conditions or other events, including legal proceedings based upon such conditions or an inability to obtain necessary permits, could require increased financial reserves or compliance expenditures or otherwise have a material adverse effect on us.
Employees
At present, we have no full-time employees and we depend to a great extent on the principal member of our management. If we lose the services of our sole officer and director it could significantly impede the achievement of our objectives. We have not entered into employment agreements with our sole officer and director. Because our sole officer and director is inexperienced with exploration, recruiting and retaining qualified exploration personnel will be critical to our success. We may not be able to retain existing personnel or attract and retain qualified staff in the future. If we fail to hire and retain personnel in key positions, we may be unable to achieve our exploration objectives in a timely manner.
Transfer Agent
We have appointed the following transfer agent for our shares of Common Stock: Island Capital Management, LLC, dba Island Stock Transfer, located at 100 Second Avenue S., Suite 300N St. Petersburg, FL 33701. Phone: (727) 289-0010 Fax: (727) 289-0069. The transfer agent is responsible for all record-keeping and administrative functions in connection with our issued and outstanding Common Stock.
Available Information
The Company’s filings with the Securities and Exchange Commission (“SEC”) may be accessed at the internet address of the SEC, which is http://www.sec.gov. Also, the public may read and copy any materials that the Company files with at the SEC’s Public Reference Room at 100 F Street, N.E., Room 1580 Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.
ITEM 1A.
ITEM 1A. RISK FACTORS
An investment in the Company has a high degree of risk. Before you invest you should carefully consider the risks and uncertainties described below and the other information in this annual report. If any of the following risks actually occur, our business, operating results and financial condition could be harmed and the value of our stock could go down.
RISKS RELATED TO OUR COMPANY
We have a going concern opinion from our auditors, indicating the possibility that we may not be able to continue to operate.
The Company has incurred net losses of $254,492 for the period from June 28, 2006 (inception) to December 31, 2008. We anticipate generating losses for the next 12 months. Therefore, we may be unable to continue operations in the future as a going concern. No adjustment has been made in the accompanying financial statements to the amounts and classification of assets and liabilities which could result should we be unable to continue as a going concern. If we cannot continue as a viable entity, our shareholders may lose some or all of their investment in the Company.
We are a development stage company and may never be able to execute our business plan.
We were incorporated on June 28, 2006. We currently have no products, customers or revenues. Although we have begun initial planning for the development of a uranium exploration company, we may not be able to execute our business plan unless and until we are successful in raising funds in the near future. In addition, our independent auditors included an explanatory paragraph in their report on the accompanying financial statements regarding concerns about our ability to continue as a going concern. As a result, we may not be able to obtain additional necessary funding.
There can be no assurance that we will ever achieve any revenues or profitability. The revenue and income potential of our proposed business and operations is unproven, and the lack of operating history makes it difficult to evaluate the future prospects of our business.
Our business plan may be unsuccessful.
The success of our business plan is dependent on our ability to discover a mineral reserve on one or more properties covered by exploration licenses, however, there can be no assurance that we will be able to develop any potential property into a producing mine and extract those resources. Therefore, the lack of operating history makes it difficult to validate our business plan.
We have no operating history and have maintained losses since inception, which we expect to continue in the future.
We incurred net losses of $254,492 for the period from June 28, 2006 (inception) to December 31, 2008, and expect to incur more operating losses over the next 12 months and in future periods. These losses will occur because we do not yet have any revenues to offset the expenses associated with the development and exploration for uranium. We cannot guarantee that we will ever be successful in generating revenues in the future. We recognize that if we are unable to generate revenues, we may not be able to earn profits or continue operations.
There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our business will most likely fail.
There can be no assurance that we will be capable of raising the additional funding that we need to carry out our development and exploration objectives.
The further development and exploration of our mineral properties depends upon our ability to obtain financing through capital markets, or other means. There is no assurance that we will be successful in obtaining financing as and when needed. Unfavorable market conditions may make it difficult or impossible for us to obtain debt financing or equity financing on acceptable terms or at all. Failure to obtain additional financing on a timely basis may cause us to postpone our development plans, forfeit rights in some or all of our properties or reduce or terminate some or all of our operations.
Our executive officers and directors have significant voting power and may take actions that may be different than actions sought by our other shareholders.
Our sole officer and director owns approximately 57.7% of the outstanding shares of our Common Stock. Therefore, such shareholder will be able to exercise significant influence over all matters requiring shareholder approval. This influence over our affairs might be adverse to the interest of our other stockholders. In addition, this concentration of ownership could delay or prevent a change in control and might have an adverse effect on the market price of our Common Stock.
Since our officers can work or consult for other companies, their other activities could slow down our operations.
Our sole officer and director is not required to work exclusively for us and does not devote all of her time to our operations. Therefore, it is possible that her pursuit of other activities may slow our operations and reduce our financial results because of the slow down in operations. It is expected that our sole officer and director will devote between 5 and 30 hours per week to our operations on an ongoing basis, and will devote whole days and even multiple days at a stretch when required.
Our officers have no technical training or experience in mineral exploration. We may suffer irreparable harm due to this lack of experience, which in turn may result in the loss of your investment.
Due to our sole officer and director’s lack of experience, our sole officer may make wrong decisions and choices regarding mineral exploration development and may not take into account standard industry approaches which other mineral exploration companies commonly use. Consequently our operations, earnings and ultimate financial success could suffer irreparable harm due to our sole officer’s lack of experience in the mineral exploration industry. As a result we may have to suspend or cease operations which will result in the loss of your investment.
We do not have experience in placing properties into production.
We have no experience in placing mineral properties into production, and our ability to do so will be dependent upon using the services of appropriately experienced personnel or entering into agreements with other major resource companies that can provide such expertise. There can be no assurance that we will have available to us the necessary expertise to take a mineral deposit into production.
We may be unable to enforce our legal rights in certain circumstances.
In the event of a dispute arising at or in respect of our foreign operations, we may be subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons to the jurisdiction of courts in the United States or other jurisdictions. We may also be hindered or prevented from enforcing our rights with respect to a governmental entity or instrumentality because of the doctrine of sovereign immunity.
We depend on our key personnel, the loss of whom would adversely affect our operations. If we fail to attract and retain the talent required for our business, our business will be materially harmed.
We are a small company with no full-time employees as of December 31, 2008, and we depend to a great extent on the principal member of our management. If we lose the services of our sole officer and director, it could significantly impede the achievement of our objectives. We do not currently have any key man life insurance policies. We have not entered into employment agreements with our sole officer and director. In addition, recruiting and retaining qualified exploration personnel will be critical to our success. We may not be able to retain existing personnel or attract and retain qualified staff in the future. If we fail to hire and retain personnel in key positions, we may be unable to achieve our exploration objectives in a timely manner.
All of our directors and officers are outside the United States, with the result that it may be difficult for investors to enforce within the United States any judgments obtained against us or any of our directors or officers.
All of our directors and officers are nationals and/or residents of countries other than the United States, and all or a substantial portion of such persons' assets are located outside the United States. As a result, it may be difficult for investors to effect service of process on our directors or officers, or enforce within the United States any judgments obtained against us or our officers or directors, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state thereof. Consequently, you may be effectively prevented from pursuing remedies under U.S. federal securities laws against them.
Management is inexperienced in running a U.S. public company.
We are managed by a management team that is relatively unfamiliar with the capital market and the processes by which a U.S. public company should be managed and operated. Management is currently making efforts to familiarize itself with the relevant laws, rules and regulations and market practice, but there can be no assurance that it can master the relevant knowledge and skills and set up the required systems in time to prevent mistakes and to meet shareholder and market expectations.
RISKS ASSOCIATED WITH OUR COMMON STOCK
Trades on the OTC Bulletin Board may be volatile and sporadic; the market price of our Common Stock could be depressed and therefore difficult for our shareholders to resell their shares.
Our Common Stock is quoted on the OTC Bulletin Board. Trading of stock on the OTC Bulletin Board is often thin and characterized by wide fluctuations in trading prices due to many factors that may not correlate with our operations or business prospects. This volatility could depress the market price of our common stock for reasons unrelated to operating performance. Moreover, the OTC Bulletin Board is not a stock exchange and trading of securities on the OTC Bulletin Board is often more sporadic than the trading of securities on a quotation system like Nasdaq or a stock exchange like the New York Stock Exchange. Accordingly, our shareholders may have difficulty reselling some or all of their shares.
Our stock is a penny stock. Trading of our shares may be restricted by the SEC’s penny stock regulations and FINRA’s sales practice requirements, which may limit a shareholder’s ability to buy and sell our shares.
The Securities and Exchange Commission has defined “penny stock” under Rule 3a51-1 and as such our stock is penny stock. Our securities are covered by the penny stock rules, Rule 15g-9, which imposes additional sales practice requirements, including disclosure requirements, on broker-dealers who sell to persons other than established customers and “accredited investors”. The disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for stock that is subject to the penny stock rules. The penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in, and limit the marketability of, our Common Stock.
In addition, the Financial Industry Regulatory Authority has adopted rules that require a broker/dealer, when recommending an investment to a customer, to have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker/dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Interpretations of these rules suggest that there is a high probability that speculative low-priced securities will not be suitable for some customers. The Financial Industry Regulatory Authority requirements make it more difficult for broker/dealers to recommend that their customers buy our Common Stock, which may limit your ability to buy and sell our stock.
Because we do not intend to pay any cash dividends on our shares of Common Stock, our stockholders will not be able to receive a return on their shares unless they sell them.
We intend to retain any future earnings to finance the development and expansion of our business. We do not anticipate paying any cash dividends on our Common Stock in the foreseeable future. Unless we pay dividends, our stockholders will not be able to receive a return on their shares unless they sell them.
RISKS ASSOCIATED WITH MINING
No assurances are given regarding the existence of any mineral resource on any potential mineral property or mineral license that we may be able to acquire that is in commercially exploitable quantities. Funds expended on any exploration will be lost until such time as we may be able to earn revenues from operations, if any. If we do not discover any mineral resource in commercially exploitable quantities, our business may fail.
A reserve, in the context of a mining reserve, is defined by the Securities and Exchange Commission in its Industry Guide 7 as that part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination. The probability of an individual prospect ever having a “reserve” that meets the requirements of the Securities and Exchange Commission’s Industry Guide 7 is extremely remote; in all probability any potential mineral resource property that we may be able to acquire does not contain any “reserve” and any funds that we spend on exploration will probably be lost.
Even if we do eventually discover a mineral reserve on one or more potential mineral properties or licenses that we may be able to acquire, there can be no assurance that we will be able to develop these properties or licenses into producing mines and extract those resources. Both mineral exploration and development involve a high degree of risk and few properties which are explored are ultimately developed into producing mines.
The commercial viability of an established mineral deposit will depend on a number of factors including, by way of example, the size, grade and other attributes of the mineral deposit, the proximity of the resource to infrastructure such as a processing facility, roads and a point for shipping, government regulation and market prices. Most of these factors will be beyond our control, and any of them could increase costs and make extraction of any identified mineral resource unprofitable.
Mineral operations are subject to applicable law and government regulation. Discovery of a mineral resource in a commercially exploitable quantity is subject to these laws and regulations and could restrict or prohibit the exploitation of that mineral resource. Failure to exploit any mineral resource that we might discover may cause our business to fail.
Mineral exploration and extraction procedures require permits from various foreign governmental authorities and are governed by laws and regulations, including those with respect to prospecting, mine development, mineral production, transport, export, taxation, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. We cannot assure that we may be able to obtain or maintain any permits required for exploration on any potential mineral property or license that we may be able to acquire or for the construction and operation of a mine on such properties at economically viable costs. Failure to obtain and maintain permits or failure to construct and operate a mine may cause our business to fail.
Establishing the existence of a mineral resource on any potential mineral property or license in commercially exploitable quantities and subsequently developing a potential property or license into a producing mine will require additional capital. Failure to raise this additional capital may prevent us from acquiring a potential mineral property or license, and most likely will prevent us from being able to exploit any mineral resource and may cause our business to fail.
Discovery of mineral resources in commercially exploitable quantities on any potential mineral property or license that we may be able to acquire will require us to expend substantial sums of money to establish the extent of the resource, develop processes to extract it and develop extraction and processing facilities and infrastructure. Although substantial benefits may be derived from the discovery of a major deposit, we cannot assure that such a resource will be significant to justify commercial operations, nor can we assure that we will be able to raise the funds required for timely development. Failure to raise the necessary capital or complete the necessary facilities and infrastructure may cause our business to fail.
Mineral prices are subject to dramatic and unpredictable fluctuations.
Revenues, if any, are expected to be derived from either the sale of a licensed mineral resource property if we are able to acquire such a property or from the extraction and sale of any mineral resources from such a property. Commodity prices have fluctuated widely in recent years and are affected by numerous factors beyond our control, including international, economic and political trends, expectations of inflation, currency exchange fluctuations, interest rates, global or regional consumptive patterns, speculative activities and increased production due to new extraction developments and improved extraction and production methods. The effect of these factors on the price of mineral resources and therefore the economic viability of any potential mineral property that we may be able to acquire and exploration projects cannot be accurately predicted.
The mining industry is highly competitive and we cannot assure of successful future mineral claim acquisitions. Failure to acquire properties for mineral resource exploration may require us to cease operations.
The mineral exploration, development, and production industry is largely desegregated. While we compete with other exploration companies in the effort to locate and acquire mineral resource properties, we may not compete with them for the removal or sales of mineral products from any potential mineral property or license that we may be able to acquire if we should eventually discover the presence of them in quantities sufficient to make production economically feasible. Markets exist worldwide for the sale of mineral products and we will likely be able to sell any mineral products that we identify and produce.
In identifying and acquiring mineral resource properties, we compete with many companies possessing greater financial resources and technical facilities. Competition could adversely affect our ability to acquire suitable prospects for exploration in the future. Accordingly, we cannot assure that we will acquire any interest in mineral resource properties that might yield reserves or result in commercial mining operations.
Mineral exploration and development is subject to extraordinary operating risks. We currently do not insure against these risks. As a result of an uninsured event our liability may exceed our resources, which would adversely impact on the Company.
Experience, knowledge and careful evaluation may not be able to overcome the many risks associated with exploration, development and production. Our operations are always subject to inherent hazards and risks in the exploration for mineral resources. Discovery of a mineral resource in commercially exploitable quantities, could subject our operations to all of the inherent hazards and risks associated with the development and production of resources, including liability for pollution, cave-ins or similar hazards against which we cannot or may not elect to insure. Such events may result in work stoppages and damage to property, including damage to the environment. It is not always possible to obtain insurance against all such risks and we may decide not to insure against certain risks as a result of high premiums or other reasons. The incurrence of an event that is not fully covered, or covered at all, by insurance, could have a material adverse effect on our financial conditions, results of operations and cash flows and could lead to a decline in the value of our securities. Currently, we do not maintain adequate insurance coverage against operating hazards. Payment for any liability that arises from such occurrences may have a material adverse effect on the Company.
There can be no assurance that our interest in our exploration property is free from defects.
We have investigated our rights to explore and exploit our properties and, to the best of our knowledge, those rights are in good standing but no assurance can be given that such rights will not be revoked, or significantly altered, to our detriment. There can also be no assurance that our rights will not be challenged or impugned by third parties.
An increase in industry demand may create a shortage of mining equipment.
Any increase in growth of global mining and mineral exploration activities may create a demand for mining equipment and related services that may outpace supply. As a result, future operations could be adversely affected if the Company encounters difficulties obtaining access to equipment and services on a timely basis. In the event that the Company is unable to secure required mining equipment and services on a timely basis, exploration and development activities, production, productivity and costs could be negatively affected.
ITEM 2.
ITEM 2. PROPERTIES
We currently maintain our corporate office at 43 Pireos St., Ano Voula, Athens, Greece, in space provided to us by our President. We do not pay any rental fees for use of this space. This space is sufficient until we commence full operations.
The Company does not have any policies regarding investments in real estate, securities or other forms of property.
On June 26, 2008, the Company acquired a 100% undivided interest (subject to a 1% net refining return royalty) in the Property located in the North Gemeric Permian Belt in Eastern Slovakia. See “Item 1 - Business” above for further details on the Property.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS
We know of no material, active or pending legal proceedings against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of security holders, through the solicitation of proxies or otherwise, during the fourth quarter of the fiscal year covered by this report.
PART II
ITEM 5.
ITEM 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
General
We are authorized to issue 1,500,000,000 shares of common stock, at a par value of $0.0001 per share and 50,000,000 shares of preferred stock, at a par value of $0.0001 per share. As of March 31, 2009, there are 129,999,995 shares of common stock issued and outstanding. The number of record holders of Common Stock as of March 31, 2009, is approximately 37.
Market Information
The Company’s Common Stock trades on NASDAQ’s Over-the-Counter Bulletin Board under the symbol “MLME”. It previously traded under the symbol “CBPG” between November 29, 2007, and March 25, 2008, and “SHRW” from the date the Company’s shares were first listed and posted for trading to November 28, 2007.
There is currently a limited trading market for the Company’s Common Stock and no trades have been made of our Common Stock on NASDAQ’s Over-the-Counter Bulletin Board in the past two fiscal years.
Dividend Policy
We have never paid any cash dividends and have no plans to do so in the foreseeable future. Our future dividend policy will be determined by our Board of Directors and will depend upon a number of factors, including our financial condition and performance, our cash needs and expansion plans, income tax consequences and the restrictions that applicable laws and other arrangements they impose.
Securities Authorized for Issuance Under Equity Compensation Plans
We do not have any compensation plans under which equity securities are authorized for issuance.
Recent Sales of Unregistered Securities
Not applicable.
Purchase of Equity Securities by the Company and Affiliated Purchasers
During the fiscal year ended December 31, 2008, no purchases were made by or on behalf of the Company or any “affiliated purchaser” (as defined in §240.10b-18(a)(3) of Regulation S-K), of shares or other units of any class of the Company’s equity securities.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA
The Company, as a “smaller reporting company” (as defined by §229.10(f)(1)), is not required to provide the information required by this Item.
ITEM 7.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following plan of operation together with our financial statements and related notes appearing elsewhere in this annual report. This plan of operation contains forward-looking statements that involve risks, uncertainties, and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including, but not limited to, those presented under “Item 1A. Risk Factors” elsewhere in this annual report.
Overview
Millennium Energy Corp was incorporated on June 28, 2006, in the State of Nevada. We are a start-up exploration stage corporation with no current exploration operations and no revenues from our business operations. We do not expect to commence earning revenues in the near future. Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next twelve months. We do not anticipate generating significant revenues until after we have acquired mineral properties, explored these properties and evaluated these properties as to the economic feasibility of commercially mining the properties. Accordingly, we must raise cash from sources other than our operations in order to purchase mineral properties and or licenses and rights to mine these properties and to retain specialists and consultants for the purpose of locating and securing mineral properties and thereafter beginning exploration on these properties. We plan to focus our mineral exploration prospects on mineral bodies containing uranium.
We have raised money from an offering of our shares pursuant to a Registration Statement on Form SB-2. As of June 18, 2007, we successfully completed the sale of 2,333,333 shares of our common stock to various offshore investors at a price per share of $0.03 for aggregate proceeds of $70,000. The shares of Common Stock sold to the investors were previously registered by us pursuant to a registration statement on Form SB-2, which was declared effective by the Securities and Exchange Commission on January 19, 2007.
Effective November 29, 2007, we effected a fifteen (15) for one (1) forward stock split of our authorized, issued and outstanding Common Stock. As a result, our authorized capital has increased from 100,000,000 shares of Common Stock with a par value of $0.0001 and 50,000,000 shares of preferred stock with a par value of $0.0001 to 1,500,000,000 shares of Common Stock with a par value of $0.0001 and 50,000,000 shares of preferred stock with a par value of $0.0001. As a result of the forward stock split, our issued and outstanding share capital increased from 7,333,333 shares of Common Stock to 109,999,995 shares of Common Stock.
At the present time, we have not made any arrangements to raise additional cash. However, we will require additional funds in the next twelve months and we may seek to obtain additional funds through a second public offering, private placement of securities, or loans. Other than as described in this paragraph, we have no other financing plans at this time.
Plan of Operations
We are a start-up, exploration stage corporation and have not yet generated or realized any revenues from our business operations.
Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated any revenues and no revenues are anticipated until we stake claims on mineral properties, locate mineral deposits and begin removing and selling minerals. There is no assurance we will ever reach this point. Our only source for cash at this time is investments by others in Millennium Energy Corp. We must raise cash to implement our business plan and stay in business. We intend to acquire properties or exploration rights and to conduct research in the form of exploration on such properties.
Our exploration target is to find mineral bodies containing uranium. Our success depends upon finding mineralized material. This will require a determination by a geological consultant as to whether any of the mineral properties we intend to acquire contains mineralized material. Mineralized material is a mineralized body, which has been delineated by appropriate spaced drilling or underground sampling to support sufficient tonnage and average grade of minerals to justify removal. If we don’t find mineralized material or we cannot remove mineralized material, either because we do not have the money to do it or because it is not economically feasible to do it, we will cease operations and you will lose your investment.
In addition, we may not have enough money to acquire and subsequently complete our exploration of mineral properties. If it turns out that we have not raised enough money to acquire mineral properties and complete our anticipated exploration program, we will try to raise additional funds from a private placement or loans. There is no assurance that we will raise additional money in the future. If we require additional money and are unable to raise it, we will have to suspend or cease operations.
After acquiring mineral properties, we will have to conduct exploration to determine what amount of minerals, if any, exist on the properties and if it is economically feasible to extract and process any of the mineralized material. Economically feasible means that the costs associated with the removal of the mineralized material will not exceed the price at which we can sell the mineralized material. We cannot predict what that will be until we find mineralized material.
We do not claim to have any minerals or reserves whatsoever at this time on any of our current properties.
If we are unable to complete any phase of our proposed plan of acquisition and exploration because we do not have enough money, we will cease operations until we raise more money. If we cannot or do not raise more money, we will cease operations. If we are required to cease operations, we will investigate all other opportunities to maintain stockholder value.
We do not intend to hire additional employees at this time. All of the work to be conducted on any acquired properties will be conducted by unaffiliated independent contractors that we will hire. The independent contractors will be responsible for surveying, geology, engineering, exploration, and excavation. The geologists will evaluate the information derived from the exploration and excavation and the engineers will advise us on the economic feasibility of removing any mineralized material.
Limited Operating History; Need for Additional Capital
There is limited historical financial information about us upon which to base an evaluation of our performance. We are an exploration stage company, and have not generated any revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in the acquisition and exploration of mineral properties, and possible cost overruns due to price and cost increases in services.
Once we acquire mineral properties we plan to conduct research and exploration of any acquired properties, and if successful and economically feasible, we plan to start production of any minerals we may find. We anticipate seeking equity financing to provide for the capital required to implement our research and exploration plans.
We have no assurance that future financings will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing stockholders.
Employees
At present, we have no full-time employees and we depend to a great extent on the principal member of our management. If we lose the services of our sole officer and director it could significantly impede the achievement of our objectives. We have not entered into employment agreements with our sole officer and director. Because our sole officer and director is inexperienced with exploration, recruiting and retaining qualified exploration personnel will be critical to our success. We may not be able to retain existing personnel or attract and retain qualified staff in the future. If we fail to hire and retain personnel in key positions, we may be unable to achieve our exploration objectives in a timely manner.
Liquidity and Capital Resources
To meet our need for cash we intend to raise money from private placement offerings. We cannot guarantee that we will be able to raise enough money to stay in business. If we acquire mineral properties, find mineralized material and it is economically feasible to remove the mineralized material, we will attempt to raise additional money through a subsequent private placement, public offering or through loans. If we do not raise all of the money we need to complete our exploration plans, we will have to find alternative sources, like a second public offering, a private placement of securities, or loans from our officers or others.
At December 31, 2008, we had working capital deficiency of $179,492, whereas at December 31, 2007, cash and cash equivalents from inception to December 31, 2007, had been insufficient to provide the working capital necessary to operate. At December 31, 2008, our total assets consisted of cash of $1,855 and resource property of $6,000,000 compared to assets with a value of $82,605 at December 31, 2007.
From inception to December 31, 2008, we have incurred losses of $254,492. The principal components of our losses for the fiscal year ended December 31, 2008, included general and administrative costs of $95,496 and property development costs of $75,000.
As of the date of this annual report we have yet to generate any revenues.
As of December 31, 2008, our total assets were $6,001,855; our total liabilities were $181,347; and, we had cash resources of $1,855.
We will need to raise additional capital to continue our operations. We cannot guarantee that additional funding will be available on favorable terms, if at all. Any shortfall will affect our ability to expand or even continue our operations.
Results of Operation
Net Loss. The Company has net losses for the period from inception to December 31, 2008, of $254,492. This condition raises substantial doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern is dependent on its ability to meet its obligations, to obtain additional financing as may be required and ultimately to attain profitability. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Net Operating Losses. As of December 31, 2008, the Company has a net operating loss carry forward of approximately $254,492 which will expire 19 years from the date the loss was incurred.
Revenues. We have not generated any revenues to date from our operations.
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
MOORE & ASSOCIATES, CHARTERED
ACCOUNTANTS AND ADVISORS
PCAOB REGISTERED
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Millennium Energy Corporation formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
(An Exploration Stage Company)
We have audited the accompanying balance sheets of Millennium Energy Corporation formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc. (An Exploration Stage Company) as of December 31, 2008 and 2007, and the related statements of operations, stockholders’ equity (deficit) and cash flows for the years ended December 31, 2008 and 2007 and from inception on June 28, 2006 through December 31, 2008. 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 conduct our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Millennium Energy Corporation formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc. (An Exploration Stage Company) as of December 31, 2008 and 2007, and the related statements of operations, stockholders’ equity and cash flows for the years ended December 31, 2008 and 2007 and from inception on June 28, 2006 through December 31, 2008, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 8 to the financial statements, the Company has an accumulated deficit of $254,492, which raises substantial doubt about its ability to continue as a going concern. Management’s plans concerning these matters are also described in Note 8. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Moore & Associates, Chartered
Moore & Associates, Chartered
Las Vegas, Nevada
April 14,
2675 S. Jones Blvd. Suite 109, Las Vegas, NV 89146 (702) 253-7499 Fax (702) 253-7501
MILLENNIUM ENERGY CORP.
(Formerly CBp Carbon Green, Inc. and formerly Shopper's Wallet, Inc.)
(An Exploration Stage Company)
BALANCE SHEETS
MILLENNIUM ENERGY CORP.
(Formerly CBp Carbon Green, Inc. and formerly Shopper's Wallet, Inc.)
(An Exploration Stage Company)
STATEMENTS OF OPERATIONS
MILLENNIUM ENERGY CORP.
(Formerly CBp Carbon Green, Inc. and formerly Shopper's Wallet, Inc.)
(An Exploration Stage Company)
STATEMENTS OF STOCKHOLDERS' EQUITY
JUNE 28, 2006 (INCEPTION) TO DECEMBER 31, 2008
MILLENNIUM ENERGY CORP.
(Formerly CBp Carbon Green, Inc. and formerly Shopper's Wallet, Inc.)
(An Exploration Stage Company)
STATEMENTS OF CASH FLOWS
MILLENNIUM ENERGY CORP.
Formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
( An Exploration Stage Company)
Notes to Financial Statements
Year Ended December 31, 2008
1. GENERAL ORGANIZATION AND BUSINESS
Effective November 29, 2007, Shopper’s Wallet, Inc., a development stage company, incorporated on June 28, 2006 under the laws of the State of Nevada, completed a merger with its wholly owned inactive subsidiary CBp Carbon Green, Inc. Under the terms of the merger Shopper’s Wallet, Inc. is the surviving corporation and is governed by the laws of the States of Nevada. Upon the effective date of the merger November 29, 2007, CBp Carbon Green, Inc. was merged up and into the surviving corporation which resulted in the subsidiary been effectively dissolved. In connection with the merger, Shopper’s Wallet, Inc. amended its articles to change its name to CBp Carbon Green, Inc.
The Company also affected a forward stock split of 15 common shares for each 1 share issued and outstanding. The merger and forward stock split became effective as of November 29, 2007. Upon effectiveness of the split, the authorized capital increased from 150,000,000 to 2,250,000,000 and the issued and outstanding increased from 7,333,333 to 109,999,995. The authorized capital was then corrected to 1,500,000,000 shares of common stock and 50,000,000 shares of preferred stock.
On March 11, 2008, the Company entered into an Agreement and Plan of Merger with its wholly-owned inactive subsidy Millennium Energy Corp. Under the terms of the merger, the Company is the surviving corporation with the articles of incorporation being amended to change the Company’s name to Millennium Energy Corp. The merger became effective as of March 26, 2008.
While management of the Company believes that the Company will be successful in providing cash resources from debt and equity transactions, there can be no assurance that the Company will be able to generate the resources required under its business plan, or be successful in its capital formation activities to allow the Company to commence and sustain its operations, and achieve profitability. As of December 31, 2008, Millennium Energy Corp. had accumulated losses since inception of $254,492. These factors raise substantial doubt regarding Millennium Energy Corp.’s ability to continue as a going concern. The accompanying 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 Millennium Energy Corp. be unable to continue as a going concern.
2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES
These financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America.
CASH AND CASH EQUIVALENTS
For the purpose of the statement of cash flows, cash equivalents include all highly liquid investments with maturity of three months or less.
MILLENNIUM ENERGY CORP.
Formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
( An Exploration Stage Company)
Notes to Financial Statements
Year Ended December 31, 2008
2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES (CONTINUED)
EARNINGS (LOSS) PER SHARE
The basic earnings (loss) per share are calculated by dividing the Company’s net income available to common shareholders by the weighted average number of common shares outstanding during the year. The diluted earnings (loss) per share are calculated by dividing the Company’s net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted as of the first of the year for any potentially dilutive debt or equity. There are no diluted shares outstanding.
PROPERTY DEVELOPMENT
Property development costs are written off as expenses when incurred.
DIVIDENDS
The Company has not adopted any policy regarding payment of dividends. No dividends have been paid during the period shown.
INCOME TAXES
The Company provides for income taxes under Statement of Financial Accounting Standards No. 109 (SFAS 109). SFAS 109 requires the use of an asset and liability approach in accounting for income taxes.
SFAS 109 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. No provision for income taxes is included in the statement due to its immaterial amount, net of the allowance account, based on the likelihood of the Company to utilize the loss carry-forward.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
NET INCOME PER COMMON SHARE
Net income (loss) per common share is computed based on the weighted average number of common shares outstanding and common stock equivalents, if not anti-dilutive. The Company has not issued any potentially dilutive common shares.
MILLENNIUM ENERGY CORP.
Formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
( An Exploration Stage Company)
Notes to Financial Statements
Year Ended December 31, 2008
2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES (CONTINUED)
REVENUE AND COST RECOGNITION
The Company has no current source of revenue; therefore the Company has not yet adopted any policy regarding the recognition of revenue or cost.
3. INCOME TAXES
As noted above, income taxes are provided in accordance with SFAS 109. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carry forwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
4. RESOURCE PROPERTY
The Company entered into a Mineral Property Use and Exploitation Rights Agreement with a Slovakian company named “CEM” on June 26, 2008. CEM owns certain uranium mineral property interests in Eastern Slovakia. CEM grants to Millennium 100% undivided interest in the rights to the use and exploitation of the property for 25 years commencing on June 30, 2008 (the “Term”) ( subject to the NRR Royalty reserved to CEM). In order to exercise its rights the Company issued a total of 20 million restricted shares of common stock on September 22, 2008. Millennium will also be required to incur at least 5,000,000 Euros of expenditures on the property on or before July 5, 2013. Millennium shall ensure that all governmental and regulatory fees associated with the Property are kept in good standing, including all necessary leases or permits, taxes and rentals, during the Term. Millennium shall have the option to renew the Rights for an additional 25 year period after the initial Term upon the issuance of an additional 10,000,000 restricted shares of common stock to CEM before 30 days prior to the end of the Term.
5. STOCKHOLDERS’ EQUITY
AUTHORIZED
The Company was initially authorized to issue 100,000,000 shares of $0.0001 par value common stock and 50,000,000 shares of preferred stock, par value $0.0001 per share.
On November 29, 2007, the Company had a fifteen (15) for one (1) forward stock split of its authorized and issued and outstanding common stock. As a result of the split, the Company’s authorized capital increased from 150,000,000 to 2,250,000,000 shares with a par value of $0.0001. The authorized capital was then corrected to 1,500,000,000 shares of common stock and 50,000,000 shares of preferred stock.
MILLENNIUM ENERGY CORP.
Formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
( An Exploration Stage Company)
Notes to Financial Statements
Year Ended December 31, 2008
5. STOCKHOLDERS’ EQUITY (CONTINUED)
ISSUED AND OUTSTANDING
On June 28, 2006 (inception), the Company issued 5,000,000 shares of its common stock to its Directors for cash of $5,000.
On June 18, 2007, the Company closed a private placement for 2,333,333 common shares at a price of $0.03 per share, for aggregate proceeds of $70,000. The shares of common stock sold to the investors were previously registered pursuant to a registration statement on Form SB-2, which was declared effective by the Securities and Exchange Commission on January 19, 2007. The Company accepted subscriptions from 36 offshore non-affiliated investors.
Due to the 15 to 1 forward stock split effective November 29, 2007, the Company’s issued and outstanding share capital has increased from 7,333,333 share of common stock to 109,999,995 shares of common stock.
The Company issued 20,000,000 common shares on September 22, 2008 to acquire the rights to the use and exploitation of a resource property.
6. RELATED PARTY TRANSACTIONS
The Company neither owns nor leases any real or personal property. The Company’s Directors provide office space free of charge.
On June 28, 2006 (inception), the Company issued 5,000,000 share of its common stock to its Directors for cash of $5,000.
A former Director, loaned the company $16,200 during 2007. The loan bears no interest and is payable on demand on or after December 1, 2007 pursuant to the terms of a promissory note dated December 1, 2006. Partial repayment of $7,133 was made in October, 2007. The outstanding balance of the loan is $9,067 at December 31, 2008.
7. LOAN PAYABLE
The loan bears no interest and has no fixed term of repayment.
8. GOING CONCERN
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has net losses for the period from inception to December 31, 2008 of $254,492. This condition raises substantial doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern is dependent on its ability to meet its obligations, to obtain additional financing as may be required and ultimately to attain profitability. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
MILLENNIUM ENERGY CORP.
Formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
( An Exploration Stage Company)
Notes to Financial Statements
Year Ended December 31, 2008
9. NET OPERATING LOSSES
As of December 31, 2008, the Company has a net operating loss carry forward of approximately $254,492 which will expire 19 years from the date the loss was incurred.
10. OTHER COMMITMENTS
The Company entered into a Mineral Property Use and Exploitation Rights Agreement with a Slovakian company named “CEM” on June 26, 2008. Millennium will be required to incur at least 5,000,000 Euros of expenditures on the property on or before July 5, 2013.
11. RECENT ACCOUNTING PRONOUNCEMENTS
In June 2008, the FASB issued FASB Staff Position EITF 03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities, (“FSP EITF 03-6-1”). FSP EITF 03-6-1 addresses whether instruments granted in share-based payment transactions are participating securities prior to vesting, and therefore need to be included in the computation of earnings per share under the two-class method as described in FASB Statement of Financial Accounting Standards No. 128, “Earnings per Share.” FSP EITF 03-6-1 is effective for financial statements issued for fiscal years beginning on or after December 15, 2008 and earlier adoption is prohibited. We are not required to adopt FSP EITF 03-6-1; neither do we believe that FSP EITF 03-6-1 would have material effect on our consolidated financial position and results of operations if adopted.
In May 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts-and interpretation of FASB Statement No. 60”. SFAS No. 163 clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement of premium revenue and claims liabilities. This statement also requires expanded disclosures about financial guarantee insurance contracts. SFAS No. 163 is effective for fiscal years beginning on or after December 15, 2008, and interim periods within those years. SFAS No. 163 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.
In May 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles”. SFAS No. 162 sets forth the level of authority to a given accounting pronouncement or document by category. Where there might be conflicting guidance between two categories, the more authoritative category will prevail. SFAS No. 162 will become effective 60 days after the SEC approves the PCAOB’s amendments to AU Section 411 of the AICPA Professional Standards. SFAS No. 162 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.
MILLENNIUM ENERGY CORP.
Formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
( An Exploration Stage Company)
Notes to Financial Statements
Year Ended December 31, 2008
11. RECENT ACCOUNTING PRONOUNCEMENTS ( CONTINUED)
In March 2008, the Financial Accounting Standards Board, or FASB, issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities-an amendment of FASB Statement No. 133. This standard requires companies to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. This Statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The Company has not yet adopted the provisions of SFAS No. 161, but does not expect it to have a material impact on its consolidated financial position, results of operations or cash flows.
In December 2007, the SEC issued Staff Accounting Bulletin (SAB) No. 110 regarding the use of a "simplified" method, as discussed in SAB No. 107 (SAB 107), in developing an estimate of expected term of "plain vanilla" share options in accordance with SFAS No. 123 (R), Share-Based Payment. In particular, the staff indicated in SAB 107 that it will accept a company's election to use the simplified method, regardless of whether the company has sufficient information to make more refined estimates of expected term. At the time SAB 107 was issued, the staff believed that more detailed external information about employee exercise behavior (e.g., employee exercise patterns by industry and/or other categories of companies) would, over time, become readily available to companies. Therefore, the staff stated in SAB 107 that it would not expect a company to use the simplified method for share option grants after December 31, 2007. The staff understands that such detailed information about employee exercise behavior may not be widely available by December 31, 2007. Accordingly, the staff will continue to accept, under certain circumstances, the use of the simplified method beyond December 31, 2007. The Company currently uses the simplified method for “plain vanilla” share options and warrants, and will assess the impact of SAB 110 for fiscal year 2009. It is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements-an amendment of ARB No. 51. This statement amends ARB 51 to establish accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. Before this statement was issued, limited guidance existed for reporting noncontrolling interests. As a result, considerable diversity in practice existed. So-called minority interests were reported in the consolidated statement of financial position as liabilities or in the mezzanine section between liabilities and equity. This statement improves comparability by eliminating that diversity. This statement is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008 (that is, January 1, 2009, for entities with calendar year-ends). Earlier adoption is prohibited. The effective date of this statement is the same as that of the related Statement 141 (revised 2007). The Company will adopt this Statement beginning March 1, 2009. It is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
MILLENNIUM ENERGY CORP.
Formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
( An Exploration Stage Company)
Notes to Financial Statements
Year Ended December 31, 2008
11. RECENT ACCOUNTING PRONOUNCEMENTS ( CONTINUED)
In December 2007, the FASB, issued FAS No. 141 (revised 2007), Business Combinations’. This Statement replaces FASB Statement No. 141, Business Combinations, but retains the fundamental requirements in Statement 141. This Statement establishes principles and requirements for how the acquirer: (a) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; (b) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and (c) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. This statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. An entity may not apply it before that date. The effective date of this statement is the same as that of the related FASB Statement No. 160, Noncontrolling Interests in Consolidated Financial Statements. The Company will adopt this statement beginning March 1, 2009. It is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
In February 2007, the FASB, issued SFAS No. 159, The Fair Value Option for Financial Assets and Liabilities-Including an Amendment of FASB Statement No. 115. This standard permits an entity to choose to measure many financial instruments and certain other items at fair value. This option is available to all entities. Most of the provisions in FAS 159 are elective; however, an amendment to FAS 115 Accounting for Certain Investments in Debt and Equity Securities applies to all entities with available for sale or trading securities. Some requirements apply differently to entities that do not report net income. SFAS No. 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of the previous fiscal year provided that the entity makes that choice in the first 120 days of that fiscal year and also elects to apply the provisions of SFAS No. 157 Fair Value Measurements. The Company will adopt SFAS No. 159 beginning March 1, 2008 and is currently evaluating the potential impact the adoption of this pronouncement will have on its consolidated financial statements.
MILLENNIUM ENERGY CORP.
Formerly CBp Carbon Green, Inc. and formerly Shopper’s Wallet, Inc.
( An Exploration Stage Company)
Notes to Financial Statements
Year Ended December 31, 2008
11. RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements. This statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. This statement applies under other accounting pronouncements that require or permit fair value measurements, the Board having previously concluded in those accounting pronouncements that fair value is the relevant measurement attribute. Accordingly, this statement does not require any new fair value measurements. However, for some entities, the application of this statement will change current practice. This statement is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. Earlier application is encouraged, provided that the reporting entity has not yet issued financial statements for that fiscal year, including financial statements for an interim period within that fiscal year. The Company will adopt this statement March 1, 2008, and it is not believed that this will have an impact on the Company’s consolidated financial position, results of operations or cash flows.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Moore & Associates, Chartered Accountants are our auditors. During the Company's two most recent fiscal years, there were no disagreements with our auditors which were not resolved on any matter concerning accounting principles or practices, financial statement disclosure, or auditing scope and procedure, which disagreements, if not resolved to the satisfaction of our auditors would have caused them to make reference to the subject matter of the disagreements in connection with their reports.
ITEM 9A.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our President, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our President concluded that our disclosure controls and procedures as of the end of the period covered by this report were effective such that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is: (i) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms; and (ii) accumulated and communicated to our management, including our President, as appropriate to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
Annual Report of Management on Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States. Internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Millennium Energy Corp.; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States, and that receipts and expenditures of Millennium Energy Corp. are being made only in accordance with authorizations of management and directors of Millennium Energy Corp., as appropriate; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the assets of Millennium Energy Corp. that could have a material effect on the financial statements.
Management, with the participation of our principal executive officer and principal financial officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2008, the end of our fiscal year. Management’s assessment included evaluation of such elements as the design and operating effectiveness of key financial reporting controls, process documentation, accounting principles and our overall control environment. This assessment is supported by testing and monitoring performed under the direction of management.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluations of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Accordingly, even an effective system of internal control over financial reporting will provide only reasonable assurance with respect to financial statement preparation.
Based on our assessment, management has concluded that our internal control over financial reporting was effective as of the end of December 31, 2008, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States. Our audit committee has reviewed the results of management’s assessment.
This annual report does not include an attestation report of the Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual report.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal controls over financial reporting that occurred during our fourth fiscal quarter of the period covered by this annual report on Form 10-K that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
ITEM 9B.
ITEM 9B. OTHER INFORMATION
Not applicable.
PART III
ITEM 10.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
Directors, Executive Officers and Significant Employees
The following table sets forth certain information regarding the members of our Board of Directors, executive officers and our significant employees as of March 31, 2009:
Name
Age
Positions and Offices Held
Jana Whitlock(1)
President, Chief Executive Officer, Chief Financial Officer, Treasurer and director
Notes:
(1)
Ms. Jana Whitlock was appointed as President, Chief Executive Officer, Chief Financial Officer, Treasurer and a director on November 18, 2007.
Family Relationships
There are no family relationships between any of the Company’s directors or executive officers.
Business Experience
Jana Whitlock (age 57) has been our President, Chief Executive Officer, Chief Financial Officer, Treasurer and a director of the Company since November 18, 2007. From 2007 to date, Ms. Whitlock has been the Marketing Director of Meridian Marketing & Research S.A., which is based in Greece and is in the business of trading fast moving consumer goods and is the representative office for the EU on behalf of several major independent cigarette factories. From 2000 to 2007, Ms. Whitlock was the Marketing Director for European Tobacco Inc., which is based in Greece. From 1998 to 2000, Ms. Whitlock was a Zone Manager for BAT/Rothmans of Pall Mall International Ltd. based in the Ukraine. Ms. Whitlock obtained her Bachelors of Arts Degree (Honours) from the University of London, School of Slavonic and Eastern European Studies in 1974. In addition, Ms. Whitlock completed a Business Management Course at Nene College, Northampton in 1978.
Involvement in Certain Legal Proceedings
We are not aware of any material legal proceedings that have occurred within the past five years concerning any director, director nominee, or control person which involved a criminal conviction, a pending criminal proceeding, a pending or concluded administrative or civil proceeding limiting one’s participation in the securities or banking industries, or a finding of securities or commodities law violations.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) requires executive officers and directors and persons who own more than ten percent of our Common Stock to file reports of ownership and changes in ownership with the SEC. Such executive officers, directors and greater than ten percent stockholders are also required by SEC rules to furnish us with copies of all Section 16(a) forms they file. Based on information supplied to the Company and filings made with the SEC, the Company believes that during the fiscal year ended December 31, 2008, all Section 16(a) filing requirements applicable to its directors, executive officers, and greater than ten percent beneficial owners were complied with, except as follows:
Central European Metals S.R.O. failed to file a Form 3 within ten days of becoming a greater than 10% beneficial owner on September 22, 2008. Central European Metals S.R.O. is in the process of applying for EDGAR codes.
Code of Ethics
At the present time, the Company has not adopted a code of ethics. The Company intends to adopt a code of ethics in the near future.
Audit Committee
At the present time, the Company’s audit committee consists of all the members of our Board of Directors, Ms. Jana Whitlock. Our Board of Directors does not currently have a member that qualifies as an “audit committee financial expert”. We believe that the cost related to retaining such a financial expert at this time is prohibitive. Further, we believe the services of an audit committee financial expert would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development and the fact that we have not generated any material revenues to date.
There has not been any defined policy or procedure requirements for shareholders to submit recommendations or nomination for directors.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION
In this item, “Named Executive Officer” means:
(i)
all individuals serving as the Company’s principal executive officer or acting in a similar capacity during the last completed fiscal year (“PEO”), regardless of compensation level
(ii)
the Company’s two most highly compensated executive officers other than the PEO who were serving as executive officers at the end of the last completed fiscal year and whose total compensation exceeds $100,000; and
(iii)
up to two additional individuals for whom disclosure would have been provided pursuant to paragraph (ii) but for the fact that the individual was not serving as an executive officer of the Company at the end of the last completed fiscal year.
Summary Compensation Table
The following table contains disclosure of all plan and non-plan compensation awarded to, earned by, or paid to the Company’s Named Executive Officers by any person for all services rendered in all capacities to the Company and its subsidiaries during the Company’s fiscal years completed December 31, 2008, and 2007:
Notes:
(1)
Ms. Jana Whitlock was appointed as President, Chief Executive Officer, Chief Financial Officer, Treasurer and a director on November 18, 2007.
Narrative Disclosure to the Summary Compensation Table
We have not paid, nor do we owe, any compensation to our executive officer. We have not paid any compensation to our executive officers since inception and we do not have any employment agreements with any of our executive officers or employees.
Outstanding Equity Awards at Fiscal Year-End
We have not granted any equity awards and there are no outstanding equity awards at that the fiscal year ended December 31, 2008.
Director Compensation
As at the fiscal year ended December 31, 2008, we did not pay, nor do we owe, any compensation to our directors. We do not have any employment agreements with any of our directors.
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following table sets forth information as of March 31, 2009 (the “Determination Date”), with respect to the Company’s directors, Named Executive Officers, and each person who is known by the Company to own beneficially, more than five percent (5%) of the Company’s Common Stock, and with respect to shares owned beneficially by all of the Company’s directors and executive officers as a group. Common Stock not outstanding but deemed beneficially owned by virtue of the right of an individual to acquire shares within 60 days is treated as outstanding only when determining the amount and percentage of Common Stock owned by such individual. Except as noted, each person or entity has sole voting and sole investment power with respect to the shares shown.
As of the Determination Date, there are 129,999,995 shares of Common Stock issued and outstanding.
Notes:
(1)
Beneficial ownership of Common Stock has been determined for this purpose in accordance with Rule 13d-3 under the Exchange Act, under which a person is deemed to be the beneficial owner of securities if such person has or shares voting power or investment power with respect to such securities, has the right to acquire beneficial ownership within 60 days or acquires such securities with the purpose or effect of changing or influencing the control of the Company.
Securities Authorized for Issuance Under Equity Compensation Plans
We do not have any compensation plans under which equity securities are authorized for issuance.
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
There are no transactions, since the beginning of the Company’s fiscal year ended December 31, 2007, or any currently proposed transaction, in which the Company was or is to be a participant and the amount involved exceeds $120,000 or one percent of the average of the Company’s total assets at year end for the last two fiscal years, and in which any related person had or will have a direct or indirect material interest.
Director Independence
As of the date of this annual report, our common stock is traded on the OTC Bulletin Board (the “OTCBB”). The OTCBB does not impose on us standards relating to director independence or the makeup of committees with independent directors, or provide definitions of independence. However, under the definition of “Independent Director” as set forth in the NYSE AMEX Company Guide Section 8.03A, we currently do not have any directors that would qualify as independent directors under the definition in the AMEX Company Guide.
ITEM 14.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following table discloses the fees billed by our auditor in connection with the audit of the Company’s annual financial statements for the years ended December 31, 2008, and 2007.
Notes:
(1)
The aggregate fees billed for the fiscal year for professional services rendered by the principal accountant for the audit of the Company’s annual financial statements and review of financial statements included in the Company’s Form 10-Qs or services that are normally provided by the accountant in connection with statutory and regulatory engagements for that fiscal years.
(2)
The aggregate fees billed in the fiscal year for assurance and related services by the principal accountants that are reasonably related to the performance of the audit or review of the Company’s financial statements and are not reported in Note 1.
(3)
The aggregate fees billed in the fiscal year for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning.
(4)
The aggregate fees billed in the fiscal year for the products and services provided by the principal accountant, other than the services reported in Notes (1), (2) and (3).
Audit Committee’s Pre-Approval Practice
Section 10A(i) of the Securities Exchange Act of 1934, as amended, prohibits our auditors from performing audit services for us as well as any services not considered to be audit services unless such services are pre-approved by our audit committee or, in cases where no such committee exists, by our board of directors (in lieu of an audit committee) or unless the services meet certain de minimis standards.
PART IV
ITEM 15.
ITEM 15. EXHIBITS, FINANCIAL STATEMENTS
Exhibits
Exhibit No.
Description of Exhibit
3.1(1)
Articles of Incorporation.
3.2(1)
Bylaws.
3.3(2)
Articles of Merger filed with the Secretary of State of Nevada on November 19, 2007 and which is effective November 29, 2007.
3.4(2)
Certificate of Change filed with the Secretary of State of Nevada on November 19, 2007 and which is effective November 29, 2007.
Exhibit No.
Description of Exhibit
3.5(3)
Articles of Merger filed with the Secretary of State of Nevada on March 11, 2008, and which is effective March 26, 2008.
3.6(4)
Certificate of Correction filed with the Secretary of State of Nevada on August 7, 2008.
10.1(4)
Mineral Property Use and Exploitation Rights Agreement dated June 26, 2008 between Millennium Energy Corp. and Central European Metals S.R.O.
31.1
Certificate pursuant to Rule 13a-14(a).
31.2
Certificate pursuant to Rule 13a-14(a).
32.1
Certificate pursuant to 18 U.S.C. Section 1350.
32.2
Certificate pursuant to 18 U.S.C. Section 1350.
Notes:
(1)
Previously filed on Form SB-2 with the SEC via EDGAR on January 3, 2007 and incorporated herein by reference.
(2)
Previously filed on Form 8-K with the SEC via EDGAR on November 29, 2007 and incorporated herein by reference.
(3)
Previously filed on Form 8-K with the SEC via EDGAR on March 31, 2008 and incorporated herein by reference.
(4)
Previously filed on Form 10-QSB with the SEC via EDGAR on August 13, 2008 and incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on this 15th day of April, 2009.
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 Company and in the capacities and on the dates indicated:
EXHIBIT INDEX