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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[X] | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 2006 | |
OR | |
[ ] | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the transition period from to |
COMMISSION FILE NUMBER 000-51671
MIDDLE KINGDOM RESOURCES LTD.
(Exact name of registrant as specified in its charter)
NEVADA | 98-0432994 |
(State of other jurisdiction of incorporation or organization) | (IRS Employer Identification Number) |
347 Bay Street
Suite 202
Toronto, Ontario
Canada M5H 2R7
(Address of principal executive offices)
(416) 362-2785
(Registrant's telephone number, including area code)
The Registrant is a Shell company: Yes [ X ] No [ ]
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]
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PART II. FINANCIAL INFORMATION
ITEM 1. INTERIM FINANCIAL STATEMENTS
Moen & Company, Chartered Accountants, our auditing firm, has not yet completed a review of our quarterly financial statements. They have advised us that the review will be completed within the next fourteen days. At that time, we will file an amended report which will include an amended Plan of Operations and our Auditor's Review of our Financial Statements.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this report. These forward-looking states are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or out predictions.
We are a start-up, exploration stage corporation and have not yet generated or realized any revenues from our business operations.
We were unable to complete our public offering and have suspended operations until we raise capital to begin exploration on one property
Subject to an ingestion of capital, we will be conducting research in the form of exploration of the property. We are not going to buy or sell any plant or significant equipment during the next twelve months. We will not buy any equipment until have located a body of ore and we have determined it is economical to extract the ore from the land.
We do not have any reserves. Even if we complete our current exploration program and it is successful in identifying a mineral deposit, of which there is no assurance whatsoever, we will have to spend substantial funds of further drilling and engineering studies before we will know if we have a commercially viable mineral deposit. We will make a decision whether to proceed with each successive phase of the exploration program upon completion of the previous phase and upon analysis of the results of that program.
We do not intend to interest other companies in the property if we find mineralized materials.
We intend to try to develop the reserves through the use of mining engineers.
If we are unable to complete any phase of exploration because we don't have enough money, we will cease operations until we raise more money. If we can't or don't raise more money, we will cease operations. If we cease operations, we don't know what we will do and we don't have any plans to do anything. Currently, we have ceased operations other than attempting to raise capital.
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We do not intend to hire additional employees at this time. All of the work on the property will be conduct 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 the mineralized material.
Milestones
The following are our milestones which are subject to raising at least $50,000:
1. | 0-90 days after raising $50,000, retain our consultant to manage the exploration of the property. - Cost $15,000. Time of retention 0-90 days. |
2. | 90-180 days after raising $50,000. - Core drilling. Core drilling will cost $20.00 per foot. The number of holes to be drilled will be dependent upon the amount raised from our public offering. Core drilling will be subcontracted to non-affiliated third parties. Time to conduct the core drilling - 90 days. |
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3. | 180-210 days after raising $50,000. Have independent a third party analyze the samples from the core drilling. Determine if mineralized material is below the ground. If mineralized material is found, we will attempt to define the ore body. We estimate that it will cost up to $5,000 to analyze the core samples and will take 30 days. |
The cost of the subcontractors is included in the description of services to be rendered.
Limited Operating History; Need for Additional Capital
There is no historical financial information about us upon which to base an evaluation of our performance. We are an exploration stage corporation 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 exploration of the property, and possible cost overruns due to price and cost increases in services.
To become profitable and competitive, we conduct into the research and exploration of the property before we start production of any minerals we may find. We are seeking equity financing to provide for the capital required to implement our research and exploration phases.
We have no assurance that future financing 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 shareholders.
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Results of Operations
From Inception on June 17, 2004
Since inception, Robert J. Kinloch, our sole officer and director has paid all our expenses to incorporate us, and for legal and accounting expenses. In June 2004, Mr. Kinloch loaned $16,440 to pay the costs of incorporation, accounting fees and a portion of legal fees for our public offering. In October 2004, we repaid Mr. Kinloch $2,500, leaving a balance due Mr. Kinloch of $13,940. On April 21, 2005, Mr. Kinloch paid legal fees in the amount of $10,000 to Conrad Lysiak, our attorney.
Liquidity and Capital Resources
To meet our need for cash we attempted to raise money from a public offering. We were unsuccessful and have no money to begin operations.
Our sole officer and director is willing to loan us additional money. At the present time, we have not made any arrangements to raise additional cash.
Until we raise at least $50,000, we cannot begin operations and cannot generate any revenues from our business operations. We have no long-term debt and do not regard long-term borrowing as a good, prospective source of financing.
Status of our public offering
On March 29, 2005, the Securities and Exchange Commission declared our Form SB-2 Registration Statement effective, file number 333-120051, permitting us to offer up to 2,000,000 shares of common stock at $0.10 per share. There is no underwriter involved in our public offering.
On December 24, 2005 our public offering expired without having reached the minimum amount as prescribed by our prospectus and pursuant to our Registration Statement which was declared effective by the Securities and Exchange Commission on March 29, 2005. Accordingly, we have suspended operations.
Deregistration of Unsold Shares of Common Stock and Withdrawal of Registration Statement
We failed to sell any shares of our common stock pursuant to our public offering filed on Form SB-2 and declared effective by the SEC on March 29, 2005. On December 24, 2005 the offering period expired and the offering terminated. Subsequently, we withdrew the registration statement pursuant to Reg. 477 of the Securities Act of 1933.
No offers of securities were made and no securities were sold, leaving all of the securities unsold. We withdrew and removed from registration all of the shares of common stock so registered.
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We may undertake a subsequent private offering in reliance upon Reg. 155(c) of the Securities Act of 1933.
ITEM 3. CONTROLS AND PROCEDURES
(a)Evaluation of Disclosure Controls and Procedures: Disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in the reports filed under the Exchange Act is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclo sure controls and procedures. Based upon and as of the date of that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed in the reports our files and submits under the Exchange Act is recorded, processed, summarized and reported as and when required.
(b)Changes in Internal Control over Financial Reporting: There were no changes in our internal control over financial reporting identified in connection with our evaluation of these controls as of the end of the period covered by this report that could have significantly affected those controls subsequent to the date of the evaluation referred to in the previous paragraph, including any correction action with regard to significant deficiencies and material weakness.
There were no changes in our internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any deficiencies or material weaknesses of internal controls that would require corrective action.
PART II - OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
On March 29, 2005, our public offering was declared effective by the SEC (SEC file no. 333-120051). On November 24, 2005 our public offering expired without any shares of our common stock being sold. On January 23, 2006 filed a post-effective amendment with the SEC and withdrew and removed from registration all of the shares of common stock so registered.
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
Exhibit No. | Document Description | |
31.1 | Certification of Principal Executive Officer and Principal Financial Officer pursuant to Rule 13a-15(a) and Rule 15d-15(a), promulgated under the Securities Exchange Act of 1934, as amended. | |
32.1 | Certification of Chief Executive Officer and Chief Financial Officer Pursuant To 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on this 19th day of April, 2006.
MIDDLE KINGDOM RESOURCES LTD. | ||
(Registrant) | ||
BY: | ROBERT KINLOCH | |
Robert J. Kinloch | ||
President, Principal Executive Officer, Secretary, Treasurer, Principal Financial Officer and sole member of the Board of Directors | ||
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