UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





FORM 10-Q





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





For the quarterly period ended September 30, 2010





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





For the transition period __________ to __________





Commission File Number        000-51640





VANGUARD MINERALS COPORATION


(formerly Knewtrino, Inc.)


(Exact name of small Business Issuer as specified in its charter)





NEVADA
Nil(State or other jurisdiction of incorporation or organization)
(IRS Employer Identification No.)402 WEST BROADWAY

SUITE 2800

SAN DIEGO, CA
92101(Address of principal executive offices)
(Zip Code)Issuer’s telephone number, including area code:
858-525-5695








Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the issuer was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.


[X] Yes[  ]No





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





Large Accelerated Filer [  ]
Accelerated Filer [   ]Non Accelerated Filer [   ] (Do not check if smaller reporting company)
Smaller Reporting Company [ X]





Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act. [  ] Yes  [ X] No





State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: As of November 18, 2010, the Company had 1,468,832 shares issued and outstanding.








TABLE OF CONTENTS


PagePART I - FINANCIAL INFORMATIONItem 1:
Financial Statements
3Item 2:
Management's Discussion and Analysis of Financial Condition and Results of Operation
16Item 3:
Quantitative and Qualitative Disclosures about Market Risk
23Item 3:
Controls and Procedures
24PART II - OTHER INFORMATIONItem 1:
Legal Proceedings
25Item 1A:
Risk Factors
25Item 2:
Unregistered Sales of Equity Securities and Use of Proceeds
26Item 3:
Defaults Upon Senior Securities
27Item 4:
Submission of Matters to a Vote of Security Holders
27Item 5:
Other Information
27Item 6:
Exhibits
27











2




PART I - FINANCIAL INFORMATION





Item 1. FINANCIAL STATEMENTS





The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q, and, therefore, do not include all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders' equity in conformity with generally accepted accounting principles. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the nine months ended September 30, 2010 are not necessarily indicative of the results that can be expected for the year ending December 31, 2010.





The following financial statements of Vanguard Minerals Corporation (the “Company”) are included with this Quarterly Report on Form 10-Q:








(a)
Balance sheets as of September 30, 2010 (unaudited) and December 31, 2009;





(b)
Statements of operations for the three and nine month periods ended September 30, 2010 and 2009 and for the period from August 25, 2003 (inception) to September 30, 2010 (unaudited);(c)
Statements of stockholders’ deficiency for the period from August 25, 2003 (inception) to September 30, 2010 (unaudited);





(d)
Statements of cash flows for the nine months ended September 30, 2010 and 2009 and for the period from August 25, 2003 (inception) to September 30, 2010 (unaudited);





(e)
Notes to the financial statements.





3





VANGUARD MINERALS CORPORATION





(AN EXPLORATION STAGE COMPANY)





FINANCIAL STATEMENTS





SEPTEMBER 30, 2010







4





VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


BALANCE SHEETS


AS OF SEPTEMBER 30, 2010 AND DECEMBER 31, 2009




September 30,

2010

(Unaudited)


December 31,

2009ASSETSCurrent assetsCash and cash equivalents

$
1,939


$
108Prepaid expenses


-



2,000Total Current Assets


1,939



2,108Advances receivable-related party


30,000



-Investment in securities


1,500,000



-Total Assets

$
1,531,939


$
2,108LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)LiabilitiesCurrent liabilitiesAccounts payable and accrued expenses

$
174,359


$
178,001Due to related parties


28,151



17,737Total Liabilities


202,510



195,738Stockholders’ Equity (deficit)Common stock, par value $0.001, 500,000,000 shares authorized, 1,468,832 shares issued and outstanding (December 31, 2009- 85,042,002 shares issued and outstanding)


1,469



84,598Additional paid-in capital


6,577,743



4,994,614Warrants


234,360



234,360Deficit accumulated during the exploration stage


(5,484,143
)


(5,507,202
)Total Stockholders’ Equity (Deficit)


1,329,429



(193,630
)Total Liabilities and Stockholders' Equity (Deficit)

$
1,531,939


$
2,108








The accompanying notes are an integral part of these financial statements.


F-1


VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


STATEMENTS OF OPERATIONS


FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2010 AND SEPTEMBER 30, 2009


PERIOD FROM AUGUST 25, 2003 (INCEPTION) TO SEPTEMBER 30, 2010


(unaudited)





Three Months

Ended

September 30,

2010


Three Months

Ended

September 30,

2009

(restated)


Nine Months

Ended

September 30,

2010


Nine Months

Ended

September 30,

2009

(restated)


Period from

August 25, 2003

(Inception)To

September 30,

2010REVENUES – Note 3

$
61,500


$
-


$
119,500


$
-


$
119,500OPERATING EXPENSESGeneral and administrative


69,181



506



76,375



9,127



495,100Exploration costs


-



-



-



-



3,839,954Wages and benefits


-



-



-



21,548



185,526Product development


-



-



-



-



270,086Rent and Utilities


19,867



1,034



20,066



3,366



87,606Depreciation


-



-



-



-



8,578TOTAL OPERATING EXPENSES


89,247



1,540



96,441



34,041



4,886,850INCOME (LOSS) FROM OPERATIONS


(27,747
)


(1,540
)


23,059



(34,041
)


(4,767,350
)OTHER INCOME (EXPENSE)


-



(5,294
)


-



(40,222
)


(716,793
)INCOME (LOSS) BEFORE INCOME TAXES


(27,747
)


(6,834
)


23,059



(74,263
)


(5,484,143
)PROVISION FOR INCOME TAXES


-







-







-NET INCOME (LOSS)

$
(27,747
)

$
(6,834
)

$
23,059


$
(74,263
)

$
5,484,143
)NET LOSS PER SHARE: BASIC AND DILUTED

$
(0.02
)

$
(0.03
)

$
(0.02
)

$
(0.28
)WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED, adjusted for 300:1 share rollback


1,593,832



268,499



1,142,617



268,499








The accompanying notes are an integral part of these financial statements.


F-2


VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (RESTATED)


AS OF SEPTEMBER 30, 2010


(unaudited)


Common Stock


Additional








Deficit

Accumulated

During the

Development


Total

Stockholders’Shares


Amount


Paid in Capital


Subscriptions


Warrants


Stage


Equity (Deficit)Balance, December 31, 2007, as originally reported


76,216,333


$
76,216


$
2,388,596





$
234,360


$
(2,698,368
)

$
804Correction of an accounting error


2,000,000



2,000



(2,000
)





-



(59,004
)


(59,004
)Balance, December 31, 2007, as Restated


78,216,333



78,216



2,386,596






234,360



(2,757,372
)


(58,200
)Issuance of common stock for cash @ $0.03 per share


2,333,333



2,333



67,667






-



-



70,000Issuance of common stock for cash @ $0.46 per share


492,336



49



224,351



-



-







224,400Common stock issued to acquire mineral interests


4,000,000



4,000



2,316,000







-



-



2,320,000Net loss for the year ended December 31, 2008


-



-



-











(2,690,830
)


(2,690,830
)Balance, December 31, 2008


85,042,002



84,598



4,994,614







234,360



(5,448,202
)


(134,630
)Net loss for the year ended December 31, 2009


-



-



-







-



(59,000
)


(59,000
)Balance, December 31, 2009


85,042,002



84,598



4,994,614



-



234,360



(5,507,202
)

$
(193,630
)Cancellation of shares set aside for share subscription


(492,336
)


(49
)


(224,351
)


224,400











-Effect of 300:1 reverse stock split


(84,267,834
)


(84,267
)


84,267















-Issuance of common stock for common stock of PEI Worldwide Holdings, Inc.


1,000,000



1,000



1,499,000















1,500,000Issuance of common stock for common stock of Genesis Ventures Fund India, I, LP


125,000



125



374,875















375,000Issuance of common stock pursuant to share subscription


187,000



187



224,213



(224,400
)Recission of shares issued


(125,000
)


(125
)


(374,875
)














(375,000
)Net income (loss) for the period ended September 30, 2010


-



-



-







-



23,059



23,059Balance, September 30, 2010


1,468,832


$
1,469


$
6,577,743



-


$
234,360


$
(5,484,143
)

$
1,329,429








The accompanying notes are an integral part of these financial statements.


F-3


VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


STATEMENTS OF CASH FLOWS


FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2010 AND SEPTEMBER 30, 2009


PERIOD FROM AUGUST 25, 2003 (INCEPTION) TO SEPTEMBER 30, 2010


(unaudited)





Nine Months

Ended

September 30,

2010


Nine Months

Ended

September 30,

2009


Period from

August 25, 2003

(Inception) to

September 30,

2010CASH FLOWS USED IN OPERATING ACTIVITIESNet income (loss) for the period

$
23,059


$
(74,263
)

$
(5,484,143
)Adjustments to reconcile net loss to net cash used in operating activities:Depreciation and amortization


-



-



8,578Common stock issued for mineral property costs


-



-



2,352,500Loss on disposal of property and equipment


-



-



17,524Fair value discount on private placement


-



-



653,112Impairment of Instant Wirefree technology


-



-



46,200(Increase) decrease in prepaid expenses


2,000



-



-Increase (decrease) in accounts payable & accrued expenses


(3,642
)


70,684



174,359Cash flows provided by (used in) operating activities


21,417



(3,579
)


(2,231,870
)CASH FLOWS FROM INVESTING ACTIVITIESPurchase of property and equipment


-



-



(27,128
)Proceeds from disposal of property and equipment










1,026Loans receivable


(30,000
)






(30,000
)Instant Wirefree technology


-



-



(27,500
)Cash flows used in investing activities


(30,000
)


-



(83,602
)CASH FLOWS FROM FINANCING ACTIVITIESAdvances from related parties


10,414



-



28,151Proceeds from issuance of common stock


-



-



2,076,000Proceeds from promissory notes


-



-



213,260Cash flows provided by financing activities


10,414



-



2,317,411NET INCREASE (DECREASE) IN CASH


1,831



(3,579
)


1,939Cash, beginning of the period


108



3,707



-Cash ( bank overdraft), end of the period

$
1,939


$
128


$
1,939SUPPLEMENTAL CASH FLOW INFORMATION:Interest paid

$
-


$
-


$Income taxes paid

$
-


$
-


$
-SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIESShares issued on acquisition of Instant Wirefree Inc.

$
-


$



$
18,700Shares issued to settle debt

$
-


$
-


$
213,600Shares issued to acquire share investments

$
1,875,000 ,000


$
-


$
1,875,000







The accompanying notes are an integral part of these financial statements.


F-4





VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


NOTES TO FINANCIAL STATEMENTS


SEPTEMBER 30, 2010





NOTE 1 – NATURE OF OPERATIONS





The accompanying unaudited interim financial statements have been prepared by Vanguard Minerals Corporation ( the “Company”) pursuant to the rules and regulations of the United States Securities and Exchange Commission.  Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these financial statements have been included.  Such adjustments consist of normal recurring adjustments.  These interim financial statements should be read in conjunction with the audited financial statements of the Company for the fiscal year ended December 31, 2009.





The results of operations for the three and nine months ended September 30, 2010 are not indicative of the results that may be expected for the full year.





The Company was incorporated in the State of Nevada, United States of America on August 25, 2003.  The Company’s fiscal year end is December 31.





The Company entered into a mineral license option agreement to explore and mine two properties in Mongolia.  On April 19, 2006, the Company terminated the option agreements it previously held.





On May 2, 2006, the Company changed its name to Knewtrino, Inc. On May 24, 2006, the Company entered into an agreement to acquire certain technology owned by Instant Wirefree, Inc. by acquiring 100% of the common shares of Instant Wirefree, Inc. in exchange for cash in the amount of $ 27,500 and 18,700,000 common shares of the Company.  During the year, the Company changed its business focus and as a result will no longer be developing the Instant Wirefree technology. As a result, the Company has recognized an impairment of $ 46,200 in the value of the technology asset.





On August 10, 2007, the Company changed its name to Vanguard Minerals Corporation.





In November 2007, the Company entered into an agreement with Coastal Uranium Holdings Ltd. to acquire its right and option to an undivided 50% right, title and interest in certain mineral claims in the Athabasca region of Canada for $58,300 (Cdn) plus 2,000,000 shares of the common stock of Vanguard. In addition, Vanguard agreed to take on the financial responsibility of Coastal Uranium Holdings Ltd. to fund development of the mineral property.





In April 2008, Vanguard entered into a second agreement with Coastal Uranium Holdings Ltd. to acquire its 50% interest in mining claim S- 110476 in the Athabasca region of Canada for $ 250,000 (Cdn) plus 4,000,000 shares of the common stock of Vanguard. In addition, Vanguard agreed to take on the financial responsibility of Coastal Uranium Holdings Ltd. to fund development of the mineral property.





The Company would also seek to grow by providing specialized consulting services to established and emerging growth companies in a wide range of industries, from mineral exploration, to green and renewable energy industries, to any other industry in which Vanguard management’s experience and expertise at providing consulting services that create value.





The Company has not generated any significant revenues to date from its mineral exploration and consulting efforts, and in accordance with SFAS #7 (ASC 915-10) is considered to be an Exploration Stage Company.


F-5




VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


NOTES TO FINANCIAL STATEMENTS


SEPTEMBER 30, 2010





NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





Accounting Basis


These financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America.





Use of Estimates


The preparation of financial statements in conformity with generally accepted accounting principles of the United States 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 revenues and expenses during the year. The more significant areas requiring the use of estimates include asset impairment, stock-based compensation, and future income tax amounts. Management bases its estimates on historical experience and on other assumptions considered to be reasonable under the circumstances. However, actual results may differ from the estimates.





Mineral Properties


Costs of exploration, carrying and retaining unproven mineral lease properties are expensed as occurred. Mineral property acquisition costs are capitalized including licenses and lease payments. Although the Company has taken steps to verify title to mineral properties in which it has an interest, these procedures do not guarantee the Company’s title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects.





Impairment losses are recorded on mineral properties used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amount.





All mineral properties held at December 31, 2009 and 2008 have been fully impaired.





Loss Per 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.





Basic loss per share is calculated using the weighted average number of common shares outstanding and the treasury stock method is used to calculate diluted earnings per share. For the years presented, this calculation proved to be anti-dilutive.





Dividends


The Company has not adopted any policy regarding payment of dividends.  No dividends have been paid during the period shown.





Revenue Recognition


The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured





Income Taxes


The Company provides for income taxes using an asset and liability approach. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect currently. Deferred tax assets are reduced 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.




F-6





VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


NOTES TO FINANCIAL STATEMENTS


SEPTEMBER 30, 2010





NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)





Stock-Based Compensation


The Company did not issue any stock-based payments to its employees in 2009 or 2008. The Company uses the modified prospective method of accounting for stock-based compensation. Under this transition method, stock compensation expense includes compensation expense for all stock-based compensation awards granted on or after January 1, 2006, based on the estimated grant-date fair value.





Recent Accounting Pronouncements


In May 2009, the FASB issued SFAS 165 (ASC 855-10) entitled “Subsequent Events”.  Companies are now required to disclose the date through which subsequent events have been evaluated by management. Public entities (as defined) must conduct the evaluation as of the date the financial statements are issued, and provide disclosure that such date was used for this evaluation. SFAS 165 (ASC 855-10) provides that financial statements are considered “issued” when they are widely distributed for general use and reliance in a form and format that complies with GAAP. SFAS 165 (ASC 855-10) is effective for interim and annual periods ending after June 15, 2009 and must be applied prospectively. The adoption of SFAS 165 (ASC 855-10) during the year ended November 30, 2009 did not have a significant effect on the Company’s financial statements as of that date. In connection with the preparation of the accompanying financial statements as of September 30, 2010, management evaluated subsequent events through November 19, 2010, the date that such financial statements were issued..





In June 2009, the FASB issued SFAS 168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles. (“SFAS 168” or ASC 105-10) SFAS 168 (ASC 105-10) establishes the Codification as the sole source of authoritative accounting principles recognized by the FASB to be applied by all nongovernmental entities in the preparation of financial statements in conformity with GAAP. SFAS 168 (ASC 105-10) was prospectively effective for financial statements issued for fiscal years ending on or after September 15, 2009 and interim periods within those fiscal years. The adoption of SFAS 168 (ASC 105-10) on July 1, 2009 did not impact the Company’s results of operations or financial condition. The Codification did not change GAAP, however, it did change the way GAAP is organized and presented.





As a result, these changes impact how companies reference GAAP in their financial statements and in their significant accounting policies. The Company implemented the Codification in this Report by providing references to the Codification topics alongside references to the corresponding standards.





With the exception of the pronouncements noted above, no other accounting standards or interpretations issued or recently adopted are expected to have a material impact on the Company’s financial position, operations or cash flows.





Foreign currency transactions


The business of the Company from Canada involves incurring a substantial number of operational transactions in Canada for which it transacts payments in Canadian currency through a bank account maintained for that purpose. Included in such transactions are payments for salaries, rent, consulting and many other expenses. At the time of payment, each Canadian disbursement is translated into the U. S. dollar equivalent amount and an exchange gain or loss on currency is recorded at that time. As of December 31, 2009, the Canadian bank account balance, which was the only account balance maintained in foreign currency at that date was converted into a U. S. dollar equivalent amount.




F-7





VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


NOTES TO FINANCIAL STATEMENTS


SEPTEMBER 30, 2010





NOTE 3 – RELATED PARTY TRANSACTIONS





The Company has a balance owing of $28,151 to a related party. The loan is unsecured and bears no interest. There are no specific terms of repayment with this loan.





The Company has a balance receivable of $30,000 from a related company. The loan is unsecured and bears no interest. There are no specific terms of repayment with this loan.





During the period ending September 30, 2010, the Company provided consulting services totaling $ 58,000 to entities in which our sole director is a shareholder. As of September 30, 2010, the amounts receivable from these entities was $ nil.





NOTE 4 – STOCKHOLDERS’ DEFICIT





On November 15, 2007, the Company issued 2,000,000 shares of common stock in connection with the acquisition of a 50% interest in two mineral claims.





On April 6, 2008, the Company issued 4,000,000 shares of common stock in connection with the acquisition of a third mineral claim.





During the year ended December 31, 2008, the Company issued 2,333,333 shares of common stock for $70,000 in connection with a private placement.





During the year ended December 31, 2008, the Company allocated 492,336 shares of common stock for $224,400 in connection with a share subscription.  During the period ended September 30, 2010, the company issued 187,000 shares of common stock in connection with this share subscription.





Effective April 16, 2010, the board of directors of the Company adopted a resolution to effect a 300 to 1 reverse share spit.  As a result the authorized share capital of the company has been decreased to 1,666,666 shares of common stock with par value of $0.001 per share. On May 10, 2010, the board of directors adopted a resolution to increase the authorized share capital of the company to 500,000,000 shares of common stock with a par value of $ 0.001 per share.





On April 23, 2010, the Company issued 1,000,000 shares of common stock at a deemed price of $ 1.50 per share.  In consideration, the Company received 1,000,000 shares of PEI Worldwide Holdings, Inc., a Nevada Corporation. On September 21, 2010, Vanguard signed an agreement with PEI that it would attempt to liquidate or sell its shares in PEI to a third party buyer and that if it was unable to do so in a 90 day period, the transaction would be rescinded and Vanguard would return the shares to PEI.





On June 16, 2010, the Company issued 125,000 shares of common stock at a deemed price of $ 3.00 per share. In consideration, the Company received a 15% interest in Genesis Venture Fund India, I, LP., a Delaware Limited partnership.  The sole director of the Company is the managing director of Genesis and owns a 20% interest. In August 2010, this agreement was rescinded and the shares were subsequently cancelled.




F-8





VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


NOTES TO FINANCIAL STATEMENTS


SEPTEMBER 30, 2010





NOTE 5 – INCOME TAXES





The provision for Federal income tax consists of the following:





September 30,

2010Federal income tax benefit attributable to:Current operations

$
7,840Less: utilization of net loss carryover


(7,840
)Net provision for Federal income taxes

$
-





The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows:





September 30,

2010Deferred tax asset attributable to:Net operating loss carryover

$
1,864,600Less: valuation allowance


(1,864,600
)Net deferred tax asset

$
-





Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating loss carry forwards may be limited as to use in future years.





NOTE 6 – GOING CONCERN





The Company's financial statements are prepared using the accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business.  However, the Company has not begun to generate significant revenues, and has incurred a significant operating loss as of September 30, 2010.





The Company is dependent upon its ability to secure equity and/or debt financing and there are no assurances that the Company will be successful. Without sufficient financing, or the achievement of profitable operations, it would be unlikely for the Company to continue as a going concern.




F-9





VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


NOTES TO FINANCIAL STATEMENTS


SEPTEMBER 30, 2010




NOTE 7 – CORRECTION OF ERRORS AND RESTATEMENTS





The Company has restated its balance sheet and statement of operations at December 31, 2008 to correct errors in its accounting. Property and equipment were disposed of with a net book value of $8,824. Correspondingly, depreciation expense was reduced by $7,089. In addition, accrued liabilities in the amount of $15,913 were reversed. Also, an expense paid in 2008 in the amount of $59,004 related to a prior period. The net effect of these adjustments was to increase the December 31, 2007 accumulated deficit by $59,004 and reduce the net loss for the year by $66,092.





The December 31, 2008 balance sheet has been restated to correct the property and equipment, accounts payable and accrued expenses, and stockholders’equity (deficit).





The December 31, 2008 statement of operations has been restated to reflect the changes in expenses.








The following are the before and after balances as restated:




Year Ended

December 31,

2008Balance SheetProperty and Equipment, net of depreciationBefore

$
8,824After

$
0Current LiabilitiesBefore

$
154,250After

$
138,337Stockholders’ EquityBefore

$
(141,719
)After

$
(134,630
)Statement of OperationsOperating ExpensesBefore

$
2,756,922After

$
2,733,620Other Income (Expense)Before

$
0After

$
(16,214
)Income (Loss) from OperationsBefore

$
(2,756,922
)After

$
(2,690,830
)Net Income (Loss)Before

$
(2,756,922
)After

$
(2,690,830
)





F-10





VANGUARD MINERALS CORPORATION


(AN EXPLORATION STAGE COMPANY)


NOTES TO FINANCIAL STATEMENTS


SEPTEMBER 30, 2010





NOTE 8 – SUBSEQUENT EVENTS





The Company has analyzed its operations subsequent to September 30, 2010 through November 19, 2010, the date the financial statements were issued, and has determined that it does not have any additional material subsequent events to disclose in these financial statements.







F-11





Item 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS





Cautionary Statement Regarding Forward-Looking Statements





The information in this Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve risks and uncertainties, including statements regarding our markets, capital needs, business plans and expectations. Such forward-looking statements involve risks and uncertainties regarding the ability to continue mining exploration on a timely basis, that we will attract customers, that there will be no material adverse competitive or regulatory change in conditions in our business, that our President will remain employed as such, that our forecasts accurately anticipate market demand, and that there will be no material adverse change in our operations or business or in governmental regulations affecting our business, availability of funds, common share prices, operating costs, capital costs, and other factors. Forward-looking statements are made, without limitation, in relation to marketing plans, operating plans, availability of funds, and ongoing capital and operating costs. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may", "will", "should", "expect", "plan", "intend", "anticipate", "believe", "estimate", "predict", "potential" or "continue", the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined below, and, from time to time, in other reports we file with the SEC. These factors may cause our actual results to differ materially from any forward-looking statement. We disclaim any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.





Overview





Vanguard Minerals Corporation, formerly Knewtrino, Inc., (the “Company”) was originally incorporated as Mongolian Explorations Ltd. on August 25, 2003, under the laws of the State of Nevada. We were originally founded to conduct mineral explorations in Mongolia. Although we did exploratory feasibility work on mineral lease development, we abandoned our mineral exploration efforts in April, 2006 due to the deteriorating political and security situation in Mongolia and specifically due to intense protests over North American mining concessions in that country which jeopardize the safety of our consultants as well as undermining our confidence that we will ever be able to see a return on our continued investments to develop the properties.





Since that time, we had appointed an interim chief executive officer, Jenifer Osterwalder, who saw us through our transition out of the mineral exploration business and now are under the leadership of a new chief executive officer, Vladimir Fedyunin, and we were in the process of developing a business around cell phone enabled wireless applications. Toward that end, we acquired the intellectual property of wireless technology start-up Instant Wirefree, Inc., a Nevada corporation.  Unfortunately, we were not able to make the transition to the ultra-competitive field of cell phone wireless applications.  In June, 2007, we made the decision to abandon this line of business and to no longer pursue commercialization of any product in the wireless space.  Instead, we have returned to our original, core focus of mining, where the company has its roots, however, we wished to find a more politically stable and less dangerous environment to mine in than Mongolia.


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In September, 2007, we changed our name to Vanguard Minerals Corporation to reflect our renewed commitment to our traditional core business of mineral exploration.  In November 2007, the Company entered into an agreement with Coastal Uranium Holdings Ltd. to acquire its right and option to acquire an undivided 50% right, title and interest in certain mineral claims in the Athabasca region.  The option was acquired through payment of $57,585 in cash as well as 2,000,000 common shares of the Company.  On April 6, 2008, we entered into another agreement with Coastal Uranium Holdings Ltd., whereby we acquired a 50% undivided right, title and interest to the mineral claim numbered S-110476 in the Athabasca region of Canada in exchange for $250,000 CAD ($248,508 USD) and 4,000,000 common shares of Vanguard Minerals corporation.  In addition, we have agreed to take on the financial responsibility of Coastal to fund development of the mineral property that is the subject of claim S-110476.





The Company has not yet made any significant development progress on any mineral property within the Athabasca region and does not believe it will be able to do so until it acquires additional resources through debt or equity investments, partnerships or other methods of capital infusion.





In February, 2010, James Price was appointed President, Chief Executive Officer and Sole Director of the Company.  Vladimir Fedyunin, the former President and CEO, remained as Principal Financial and Accounting Officer.





On April 16, 2010, we effected a 300 for 1 reverse stock split in our common shares for shareholders of record as of that date.





On April 20, 2010, the Company initiated a new line of business doing business as Vanguard Management.  The Company intends to provide management and business development consultation to emerging growth companies in a wide variety of fields including uranium mining, gold and silver mining, coal mining, clean coal technology, environmentally friendly resource extraction, green energy technologies as well as other businesses that may be interested in the Company's services.





On April 23, 2010, the Company completed a sale transaction whereby it sold 1,000,000 of its common shares at a price per share of $1.50.  The per share purchase price was paid in the form of shares of PEI Worldwide Holdings, Inc., a Nevada corporation ("PEI").  The per share purchase price was derived from the closing price of shares of PEI on April 20, 2010 as listed on the Pink Sheets, which was $1.50 per share.  Therefore, the total purchase price for the 1,000,000 common shares was $1,500,000.  860,000 of the shares were purchased by James Price and the other 140,000 of the shares were purchased by various purchasers.  1,000,000 shares of PEI represents approximately 2.5% of the issued and outstanding stock of PEI.





This was a related-party transaction.  Mr. Price is our sole director and he approved this transaction.  There was no disinterested director who approved this transaction.  There can be no assurance that the price reported for PEI shares on the Pink Sheets is an accurate reflection of the true value of PEI shares.





This transaction had the effect of causing a change of control in the registrant.  Prior to this transaction, the registrant had 268,499 shares of common stock issued and outstanding out of 1,666,666 authorized.    After this transaction and giving effect to the transaction described in the paragraph below regarding the issuance of 187,000 common shares, Mr. Price owns approximately 59.1% of our issued and outstanding stock and remains our sole director.


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On April 23, 2010, the registrant completed an issuance of 187,000 shares of common stock.  This stock had been subscribed for in April, 2008 for payment of $224,400 in cash received by the corporation.  The corporation issued 187,000 of its common shares to various subscribers of the stock at a per share purchase price of $1.20 per share.





On June 16, 2010, the Vanguard Minerals Corporation, the registrant, entered into a Strategic Business Development Agreement ("Agreement") with Genesis Venture Fund India I, LP, a Delaware limited partnership ("Genesis").  The Agreement provides that Vanguard will furnish business development services and strategic management consulting services to Genesis over a period of 24 months.  The Agreement provides payment of up to $250,000 in cash by Genesis to Vanguard for the consulting services based on the milestones contained in the Agreement.  In addition, under the Agreement, Vanguard will issue 125,000 shares of its common stock to Genesis in exchange for 15% of the limited partnership interests of Genesis.





Vanguard President, CEO and Sole Director, James Price, who is the controlling shareholder of Vanguard is also the Managing Director of Genesis and owns 20% of the limited partnership interests in Genesis.  Mr. Price exercises control of both entities and there can be no assurance that the terms of the transaction are fair to the shareholders of Vanguard or the limited partnership interest holders of Genesis or that the terms are reflective of the terms of a similar transaction between unrelated parties.  There are significant contingencies required for Vanguard to meet the milestone requirements under the Agreement and receive up to the $250,000 cash milestone payments and there can be no assurance that such payments will ever occur.





On September 21, 2010, Vanguard Minerals Corporation (the "Registrant") rescinded its transaction with Genesis Venture Fund India I, LP.  Under the terms of the transaction entered into on June 16, 2010, Vanguard Minerals Corporation, the registrant, entered into a Strategic Business Development Agreement ("Agreement") with Genesis Venture Fund India I, LP, a Delaware limited partnership ("Genesis").  The Agreement provided that Vanguard will furnish business development services and strategic management consulting services to Genesis over a period of 24 months.  The Agreement provided payment of up to $250,000 in cash by Genesis to Vanguard for the consulting services based on the milestones contained in the Agreement.  In addition, under the Agreement, Vanguard would have issued 125,000 shares of its common stock to Genesis in exchange for 15% of the limited partnership interests of Genesis.





The rescission means that Vanguard will not be providing any consulting services to Genesis and that Genesis will return within 30 days the 125,000 shares of Vanguard stock issued to it under the Agreement.  Vanguard has returned the membership interests to Genesis and Genesis has returned the 125,000 shares of Vanguard stock to Vanguard and there is no ongoing relationship between Vanguard and Genesis.





The sole securities that Vanguard currently owns in another company are the 1,000,000 shares of PEI Worldwide Holdings, Inc.  As of September 21, 2010, Vanguard signed an Agreement with CEO James Price and other shareholders indicating that the Company would attempt to sell or liquidate its shares to a third party buyer and that if it was unable to do so within a period of 90 days, Mr. Price and the other purchasers would agree to rescind the PEI purchase transaction and return the 1,000,000 shares of Vanguard issued in that transaction.





Out of concern for possible regulatory issues related to Vanguard's acceptance of stock for its management consulting services, Vanguard has made changes to the way that it conducts business.  As of September 21, 2010, Vanguard has notified its clients that it will not be accepting any stock or options in any of its clients as consideration.  Vanguard will only be providing services for cash compensation.


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As of September 21, 2010, Vanguard has closed its incubation division, Greenzone Ventures and would be involved in the alternative energy sector only in as much as it would provide management consulting services in that sector for cash.  The division had not yet entered into any contracts or incubated or otherwise conducted business under the planned Greenzone model.








Vanguard has also rescinded its consulting agreement with Go Healthy, Inc. effective September 21, 2010 and will only be providing consulting services to Go Healthy on a fee-for-services basis.





Previously, Vanguard had been retained by Whole In One Products, Inc., to provide strategic management and business consulting services.  Vanguard's compensation for such services consists of a royalty fee of 15% of Whole In One's gross sales and a 15% equity interest in the company.  Vanguard has not yet begun providing services under this agreement and has not yet received the equity interest nor has it received any royalties.  It is anticipated that Vanguard would begin receiving such royalties and would be issued the equity in the 3rd calendar quarter of 2010.  Whole In One Products is a client of Aero Financial.   Our CEO James Price is also a shareholder of Whole In One.





On September, 21, 2010, we amended our agreement with Whole In One Products to provide that we would not receive any equity interest in the company.  Instead, we will receive a cash bonus payment of $100,000 if Whole In One reaches $2,000,000 in gross sales of its products by June 30, 2011.





Vanguard provides strategic management consulting on a fee-for-services basis.  It does not accept stock or stock options or other securities of its clients for payment.  Vanguard provides management consulting services to emerging growth companies.  Vanguard intends to grow its management consulting business primarily by assisting companies with their domestic and international expansion plans, marketing and sales efforts.


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Results of Operations





Until April 19, 2006, we have been involved primarily in organizational activities related to our original business of mining in Mongolia, including the acquisition of the option to acquire the Altan as well as the Ovorkhangai property mineral licenses, obtaining a geological report on our mineral licenses and initiating the first phase of exploration. After April 19, 2006, when we abandoned these efforts due to the political situation in Mongolia, we acquired wireless technology from Instant Wirefree, Inc., a Nevada corporation.  We attempted to commercialize technology for the wireless space but abandoned that effort in June, 2007.  We are currently in the process of returning to our core business of mining. Toward that end, we changed our name in September 2007 and we acquired interests in mineral claims in the Athabasca region of Canada in November 2007 and April 2008.  We have incurred an accumulated net loss of $5,484,143 for the period from inception to September 30, 2010. We have had $119,500 in revenues from operations since our inception.





In April, 2010, the Company initiated a new line of business to provide management and business development consultation to emerging growth companies in a wide variety of fields.  Although the Company initially accepted stock in client companies in lieu of all or a portion of the Company’s management consulting fees, it now provides such services on a cash only, fee-for-services basis.





The Company is currently seeking financing for the development of its mineral property interests and for the development of its new line of management and business development consultation.  The Company has no present plans to acquire any plant, property of equipment during the next 12 months, but these plans may change as the financing environment in the capital markets continues to improve.





Financial Condition and Liquidity





Overview





Our financial statements contained herein have been prepared on a going concern basis, which assumes that we will be able to realize our assets and discharge our obligations in the normal course of business. We incurred an accumulated net loss of $5,484,143 for the period from inception to September 30, 2010.





Our financial statements included in this report have been prepared without any adjustments that would be necessary if we become unable to continue as a going concern and are therefore required to realize upon our assets and discharge our liabilities in other than the normal course of business.





The Company had its independent auditors re-audit its December 31, 2008 financial statements and the Company restated its financial statements for the period ending March 31, 2008 in its 10K for the period ended December 31, 2009.




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Cash and Working Capital





The Company's cash balance as of September 30, 2010 was $1,939, as compared to the cash balance of $108 as of December 31, 2009.





Periods Ending September 30, 2010 and September 30, 2009





Operating expenses for the nine month period ended September 30, 2010 and September 30, 2009 totalled $96,441and $34,041 respectively and from inception to the period ended September 30, 2010 totalled $4,886,850.The company experienced net earnings (loss) of $23,059, ($74,263) and ($5,484,143) for the nine month periods ended September 30, 2010, September 30, 2009 and from inception to period ended September 30, 2010, respectively, against $119,500 in total revenues to date from operations. The major expenses during this three month period were for general administrative costs.  Operating expenses for three month periods ending September 30, 2010 and 2009 were $89,247 and $1,540 respectively, indicating an increase in operating expenses of $87,707.  This was due almost entirely to increased general and administrative expenses.  We did not acquire any mineral property in the first six months of 2010, but we did engage in several consulting agreements.





The earnings per share (fully diluted -- weighted average) was $0.02 for the three month period ended September 30, 2010.




Liquidity and Capital Resources





For the nine month period ended September 30, 2010, net cash earned in operating activities, consisting mostly of net earnings, was $21,417. For the nine month period ended September 30, 2009, net cash used in operating activities, consisting mostly of a decrease in accounts payable and accrued expenses, was $3,579. For the period from inception to September 30, 2010, net cash used in operating activities, consisting mostly of loss from operations was $2,231,870.





For the period from inception to September 30, 2010, net cash resulting from financing activities was in the amount of $2,317,411.





Our capital resources have been limited. We currently do not, and have not yet determined when we will, generate revenue for our mining and mineral exploration activities, and to date have relied on the sale of equity and related party loans for cash required for our exploration activities and the efforts of our chief executive officer for consulting agreements. The company has no external sources of liquidity in the form of credit lines from banks. No investment banking agreements are in place and there is no guarantee that the company will be able to raise capital in the future should that become necessary.




Future Financings





We anticipate that if we pursue any additional financing, the financing would be an equity financing achieved through the sale of our common stock. We do not have any arrangement in place for any debt or equity financing. If we are successful in completing an equity financing, existing shareholders will experience dilution of their interest in our company. If we do not secure additional financing in the future we may consider bringing in a joint venture partner to provide the required funding. We have not, however, undertaken any efforts to locate a joint venture partner. In addition, we cannot provide investors with any assurance that we will be able to locate a joint venture partner to exploit our mineral resources or continue to find consulting clients.




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Off Balance Sheet Arrangements





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





Significant Contingencies





Our financial statements have been prepared assuming we will continue as a going concern. Our independent auditors have made reference to the substantial doubt about our ability to continue as a going concern in their report of independent registered public accounting firm on our audited financial statements for the year ended December 31, 2009. Our continuation is dependent upon the ability of the Company to generate profitable operations in the future and/or to obtain the necessary financing to meet its obligations and pay its liabilities arising from normal business operations when they come due. The outcome of these matters cannot be predicted with any certainty at this time and raise substantial doubt that the Company will be able to continue as a going concern.





Plan of Operation





We have developed a new plan of operation for 2010.  In addition to continuing to seek financing to develop our mineral properties in the Athabasca region of Canada, we also have developed a new line of business.  The Company intends to provide management and business development consultation to emerging growth companies in a wide variety of fields.





We are currently actively seeking to develop this line of business and we believe that there is a good chance that the Company will continue to develop modest revenues from this new line of business in 2010, though continued revenues cannot be assured and the Company has very limited visibility at this time to anticipate the extent of any such revenues.  To date, we have generated $119,500 in revenues from this line of business.





We do not intend to conduct any significant mineral exploration activities on our properties in 2010 unless we are able to obtain sufficient financing.  We continue to seek geological advice and work on developing possible partnerships for the development of these properties.  If we received funding, which is not certain, we would then intend to conduct over the next 12 months helicopter-supported property-scale boulder sampling and prospecting, close-spaced ground geophysics and drilling on our mining properties. With these two projects, consisting of 3 mineral claims, in close proximity to each other, we believe such operations can be conducted in a cost-efficient manner.  We are now ready to commence ground geophysics and drilling.  Management wishes to continue negotiations started in 2008 with geophysical and drill contractors in preparation for this exploration. Management is also reviewing other opportunities to acquire additional property in the region, both unexplored properties and properties with varying amounts of previous exploration.  We intend to develop our management consulting business and to expand it with additional consulting clients throughout the year.





Vanguard Minerals Corporation’s short-term prospects are challenging considering our lack of financial resources to fully develop our mineral properties and considering that we have not yet derived significant revenues from our new line of business.  However, should we be able to develop revenue from our new line of business or secure financing to develop our mineral properties, our prospects might improve considerably.  If we do secure additional financing to continue to exploit our  mineral properties, revenue from the sale of mineral products from our properties may still remain several years away.


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Cash requirements





Our current cash requirements are very low.  Our chief executive officer, James Price continues to serve without a salary.  Mr. Price currently hosts our operations in his offices in San Diego, California without charge.  Mr. Price has also been conducting activities in our new line of business related to business development and management consulting at minimal expense to the Company.  Nevertheless, without continued infusions of cash from management or securing additional financing or revenues from our new line of business, we will not have enough cash to continue our operations.





Research and development





We would like to spend several hundred thousand dollars over the next 12 months on exploration and extraction related to our mineral properties.  We would spend significantly more money that this developing those mineral properties at the moment that our full scale extraction operation were to commence.  However, currently we do not have enough cash to make any such expenditures.





Plant and equipment





We currently have offices in San Diego provided by our chief executive officer, James Price, at no cost.  We anticipate expanding our office within the next 6-12 months, especially in our new line of business related to management consulting and business development.





Employees





We have one employee currently, President and Chief Executive Officer James Price.  We have several consultants engaged in our mineral exploration activities, although none are currently active due to our lack of funding.  We intend to hire additional exploration and geological consultants over the next 120-180 days, if we receive funding.  We also intend to hire additional staff to develop the Company's new line of business related to management consulting and business development, as revenues from that operation permit.





The Company’s executive offices are currently located in San Diego, California. The company’s telephone number is (858)525-5695.








ITEM 3. Quantitative and Qualitative Disclosures About Market Risk




Foreign Currency and Credit Risk.  The Company has no significant off-balance-sheet concentrations of credit risk such as foreign exchange contracts, options contracts or other foreign hedging arrangements. The Company’s reporting currency is the US Dollar.  We do undertake drilling, mining exploration and other expenses related to our Canadian mining properties which must be paid in Canadian dollars and are subject to cost variations based in currency rate fluctuations.





Fair Value of Financial Instruments.  The carrying value of the Company's financial instruments, including prepaid expenses, related party receivables, accounts payable and accrued liabilities at September 30, 2010 and December 31, 2009 approximates their fair values due to the short-term nature of these financial instruments.


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ITEM 4. CONTROLS AND PROCEDURES





(a) Evaluation of disclosure controls and procedures.





Under the supervision and with the  participation  of our management,  including our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure  controls and  procedures,  as such term is defined under Rule 13a-15(e)  promulgated under the Securities  Exchange Act of 1934, as amended  (the  Exchange  Act).  As a result of this  evaluation,  we  identified material  weaknesses  in our  internal  control over  financial  reporting as of December 31, 2009.  Accordingly,  we concluded that our disclosure  controls and procedures were not effective as of December 31, 2009.





As required by SEC Rule 15d-15(b),  our Chief  Executive  Officer carried out an evaluation  under the supervision and with the  participation of our management, of the effectiveness of the design and operation of our disclosure  controls and procedures  pursuant  to  Exchange  Act Rule  15d-14 as of the end of the period covered by this report. Based on the foregoing  evaluation,  our Chief Executive Officer has  concluded  that our  disclosure  controls  and  procedures  are not effective  in  timely  alerting  them to  material  information  required  to be included in our periodic SEC filings and to ensure that information  required to be disclosed in our periodic SEC filings is accumulated and  communicated to our management,  including our Chief Executive  Officer,  to allow timely  decisions regarding  required  disclosure  as a result of the  deficiency  in our internal control over financial reporting discussed below.





The material  weakness  identified  in our amended annual  report on Form 10-K for the year ended  December  31,  2009 was  related to a lack of an  accounting  staff resulting in a lack of segregation of duties and accounting  technical expertise necessary for an effective system of internal control.





(b) Changes in internal control over financial reporting.





There were no changes in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


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PART II - OTHER INFORMATION








Item 1.  LEGAL PROCEEDINGS





We are not party to any legal proceedings.





Item 1A. RISK FACTORS.





There are certain additional risk factors that have been added to our business in addition to those that appear on our report on Form 10K for the period ending December 31, 2009.  Those factors are listed below:





We are utterly dependent on our Chief Executive Officer, James Price.





As our current cash requirements, office space, the management of any prospective mineral development and the development and execution of our new line of business in management consulting and business development services are entirely dependent on the voluntary, currently uncompensated efforts of our Chief Executive Officer, James Price. If Mr. Price were to discontinue his efforts on our behalf or refuse to continue to serve without compensation, refuse to provide us with additional cash or refuse to provide us with office space without charge, we would fail.





We are under the control of our Chief Executive Officer, James Price





As our current Chief Executive Officer, James Price, is our sole director and controls 59.1% of our issued and outstanding stock.  Mr. Price is therefore able to exert nearly complete and total control of our business, affairs, potential transactions, sale or disposition of assets, entering into contracts or acquisitions.  Mr. Price may engage, and has engaged, in related-party transactions with the Company and there can be no assurance that these transactions will be fair to us or our shareholders.  Mr. Price, because he can also increase our authorized shares and cause our shares to be issued, may be able to cause substantial dilution to our current shareholders without obtaining their consent.





We have no experience at our new line of business, management consulting and business development, and we could fail to derive any revenue therefrom





Our company has no experience in management consulting or business development.  Although our Chief Executive Officer, James Price, does have some limited experience in these areas, there can be no assurance that we will be successful in this new line of business or ever derive any revenue there from.


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Item 2.  UNREGISTERED SALES OF SECURITIES AND USE OF PROCEEDS





On April 23, 2010, the Company completed a sale transaction whereby it sold 1,000,000 of its common shares at a price per share of $1.50.  The per share purchase price was paid in the form of shares of PEI Worldwide Holdings, Inc., a Nevada corporation ("PEI").  The per share purchase price was derived from the closing price of shares of PEI on April 20, 2010 as listed on the Pink Sheets, which was $1.50 per share.  Therefore, the total purchase price for the 1,000,000 common shares was $1,500,000.  860,000 of the shares were purchased by James Price and the other 140,000 of the shares were purchased by various purchasers.  1,000,000 shares of PEI represents approximately 2.5% of the issued and outstanding stock of PEI.





This was a related-party transaction.  Mr. Price is our sole director and he approved this transaction.  There was no disinterested director who approved this transaction.  There can be no assurance that the price reported for PEI shares on the Pink Sheets is an accurate reflection of the true value of PEI shares.





This transaction had the effect of causing a change of control in the registrant.  Prior to this transaction, the registrant had 268,499 shares of common stock issued and outstanding out of 1,666,666 authorized.    After this transaction and giving effect to the transaction described in the paragraph below regarding the issuance of 187,000 common shares, Mr. Price owns approximately 59.1% of our issued and outstanding stock and remains our sole director.





On April 23, 2010, the registrant completed an issuance of 187,000 shares of common stock.  This stock had been subscribed for in April, 2008 for payment of $224,400 in cash received by the corporation.  The corporation issued 187,000 of its common shares to various subscribers of the stock at a per share purchase price of $1.20 per share.





On June 16, 2010, the Vanguard Minerals Corporation, the registrant, entered into a Strategic Business Development Agreement ("Agreement")  with Genesis Venture Fund India I, LP, a Delaware limited partnership ("Genesis").  The Agreement provides that Vanguard will furnish business development services and strategic management consulting services to Genesis over a period of 24 months.  The Agreement provides payment of up to $250,000 in cash by Genesis to Vanguard for the consulting services based on the milestones contained in the Agreement.  In addition, under the Agreement, Vanguard will issue 125,000 shares of its common stock to Genesis in exchange for 15% of the limited partnership interests of Genesis.





Vanguard President, CEO and Sole Director, James Price , who is the controlling shareholder of Vanguard is also the Managing Director of Genesis and owns 20% of the limited partnership interests in Genesis.  Mr. Price exercises control of both entities and there can be no assurance that the terms of the transaction are fair to the shareholders of Vanguard or the limited partnership interest holders of Genesis or that the terms are reflective of the terms of a similar transaction between unrelated parties.  There are significant contingencies required for Vanguard to meet the milestone requirements under the Agreement and receive up to the $250,000 cash milestone payments and there can be no assurance that such payments will ever occur.  Please see the Agreement, which is attached hereto as an exhibit which were filed on the Registrant's Form 8K on June 17, 2010 for the complete terms and conditions.





The transaction with Genesis was rescinded on September 21, 2010.


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Item 3.  DEFAULT UPON SENIOR SECURITIES





None.








Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS





During the period, the registrant filed on form Pre-14C a notification that it intended to seek consent of its shareholders to amend its articles of incorporation to change its name and to increase the number of authorized shares.  However, this matter was not in fact submitted to the shareholders for a vote during the period.





On May 10, 2010, by written consent of a majority of the shareholders of Vanguard, the majority shareholder of Vanguard, Mr. James Price, voting 59.1% of the issued and outstanding shares of the Company approved proposals to change the name of the Company to Vanguard Management Corporation and to increase the authorized common stock of Vanguard from 1,666,666 to 500,000,000, as discussed further in the company's information statement as filed with the Securities and Exchange Commission on August 3, 2010.   Both actions will become effective upon the filing of Amendments to the Articles of Incorporation with the Secretary of State of Nevada.  These amendments have not yet been filed because the Registrant has failed to yet file a definitive information statement with the Securities and Exchange Commission regarding these amendments and to allow thereafter for mailing and notice.








Item 5.  OTHER INFORMATION





On November 19, 2010, Chief Financial Officer Vladimir Fedyunin resigned.  The Board appointed James Price to serve as its principal financial and accounting officer on November 19, 2010.








Item 6.  EXHIBITS








Exhibits
Document Description




31.1
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed as an Exhibit to this Quarterly Report on Form 10-Q.31.2
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed as an Exhibit to this Quarterly Report on Form 10-Q.32.1
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed as an Exhibit to this Quarterly Report on Form 10-Q.32.2
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed as an Exhibit to this Quarterly Report on Form 10-Q.




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SIGNATURES





Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.





Vanguard Minerals CorporationDATE: November 19, 2010
/s/ James PriceJames PricePresident and CEOBy:/s/ James PriceJames PricePrincipal Financial and Accounting Officer










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