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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 MARCH 31, 2009
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 333-137481
MARIPOSA RESOURCES, LTD.
(Exact name of registrant as specified in its charter)
NEVADA | 06-1781911 |
(State or other jurisdiction of incorporation or | (IRS Employer Identification Number) |
organization) |
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11923 SW 37 Terrace, Miami, FL 33175
(Address of principal executive offices)
(305) 677-9456
(Registrant's telephone number)
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 [ ]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months ( or for such shorter period that the registrant was required to submit and post such files). Yes [ ] No [X] Not required
Indicate by check mark whether the registrant is a larger accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “larger accelerated filer,” “accelerated filer”, “non-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 a 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 [ ]
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As at May 8, 2009 there were 47,375,000 common shares issued and outstanding.
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MARIPOSA RESOURCES, LTD.
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2009
TABLE OF CONTENTS
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| PART I - FINANCIAL INFORMATION |
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Item 1. | Financial Statements | 2 |
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Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 15 |
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Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 18 |
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Item 4T. | Controls and Procedures | 18 |
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| PART II - OTHER INFORMATION |
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Item 1. | Legal Proceedings | 18 |
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Item 1A. | Risk Factors | 18 |
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Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 19 |
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Item 3. | Defaults Upon Senior Securities | 19 |
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Item 4. | Submission of Matter to a Vote of Security Holders | 19 |
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Item 5. | Other Information | 19 |
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Item 6. | Exhibits | 19 |
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| SIGNATURES | 20 |
2
PART I. FINANCIAL INFORMATION
ITEM 1. – FINANCIAL STATEMENTS.
The accompanying interim unaudited financial statements of Mariposa Resources, Ltd. (a Nevada corporation) are condensed and, therefore, do not include all disclosures normally required by accounting principles generally accepted in the United States of America. These statements should be read in conjunction with the Company's most recent annual financial statements for the year ended June 30, 2008 included in a Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on September 12, 2008. In the opinion of management, all adjustments necessary for a fair presentation have been included in the accompanying interim financial statements and consist of only normal recurring adjustments. The results of operations presented in the accompanying interim financial statements for the nine months ended March 31, 2009 are not necessarily indicative of the operating results that may be expected for the full year ending June 30, 2009.
2
MARIPOSA RESOURCES, LTD.
(An Exploration Stage Company)
INTERIM FINANCIAL STATEMENTS
MARCH 31, 2009
(Unaudited)
3
Mariposa Resources, Ltd. |
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(An Exploration Stage Company) |
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Balance Sheets |
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| As of | As of | ||
| March 31, | June 30, | ||
ASSETS | 2009 | 2008 | ||
| (Unaudited) |
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Current Assets |
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Cash and cash equivalents | $ | 2,222 | $ | 14,705 |
Prepaid expenses |
| 500 |
| 500 |
Total Current Assets |
| 2,722 |
| 15,205 |
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TOTAL ASSETS | $ | 2,722 | $ | 15,205 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) |
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Current Liabilities |
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Accounts payable and accrued liabilities | $ | 2,042 | $ | 600 |
Due to related party(Note 6) |
| 10,000 |
| - |
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Total Liabilities |
| 12,042 |
| 600 |
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STOCKHOLDERS’ EQUITY (DEFICIT) |
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Capital Stock(Note 3) |
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Authorized: |
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100,000,000 preferred shares, $0.001 par value |
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500,000,000 common shares, $0.001 par value |
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Issued and outstanding shares: |
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47,375,000 common shares |
| 47,375 |
| 47,375 |
Additional paid-in capital |
| 52,125 |
| 52,125 |
Deficit accumulated during the exploration stage |
| (108,820) |
| (84,895) |
Total Stockholders’ Equity (Deficit) |
| (9,320) |
| 14,605 |
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | 2,722 | $ | 15,205 |
- The accompanying notes are an integral part of these financial statements -
4
Mariposa Resources, Ltd. |
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(An Exploration Stage Company) |
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Interim Statements of Operations |
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(Unaudited) |
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| Cumulative | |
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| from Inception | |
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| (May 31, 2006) to | ||||||
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| Three Months Ended March 31, |
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| Nine Months Ended March 31, |
| March 31, | ||||||
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| 2009 |
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| 2008 |
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| 2009 |
| 2008 |
| 2009 | |
Revenue: | $ | - |
| $ | - |
| $ | - | $ | - | $ | - | |
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Operating Expenses: |
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General and administrative |
| 718 |
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| 1,494 |
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| 2,071 |
| 3,089 |
| 9,431 | |
Mining expenses(Note 5) |
| - |
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| - |
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| 10,500 |
| 7,700 |
| 51,265 | |
Professional fees |
| 2,675 |
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| 2,591 |
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| 11,354 |
| 8,913 |
| 48,124 | |
Total Operating Expenses |
| 3,393 |
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| 4,085 |
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| 23,925 |
| 19,702 |
| 108,820 | |
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Provision for Income Taxes(Note 4) |
| - |
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| - |
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| - |
| - |
| - | |
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Net Loss for the Period | $ | (3,393) |
| $ | (4,085) |
| $ | (23,925) | $ | (19,702) | $ | (108,820) | |
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Basic and Diluted Loss per |
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Common Share | $ | (0.00) |
| $ | (0.00) |
| $ | (0.00) | $ | (0.00) |
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Weighted Average Number of |
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Common Shares Outstanding |
| 47,375,000 |
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| 47,375,000 |
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| 47,375,000 |
| 47,375,000 |
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- The accompanying notes are an integral part of these financial statements -
5
Mariposa Resources, Ltd. |
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(An Exploration Stage Company) | ||
Interim Statements of Stockholders’ Equity (Deficit) | ||
For the Period of Inception (May 31, 2006) to March 31, 2009 |
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- The accompanying notes are an integral part of these financial statements -
6
Mariposa Resources, Ltd. (An Exploration Stage Company) |
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Interim Statements of Cash Flows |
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(Unaudited) |
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| Cumulative | |||
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| From Inception | |||
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| (May 31, 2006) to | ||||
| Nine Months Ended March 31, | March 31, | ||||
Cash Resources Provided By (Used In) | 2009 | 2008 | 2009 | |||
Operating Activities |
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Net loss for the period | $ | (23,925) | $ | (19,702) | $ | (108,820) |
Changes in operating assets and liabilities: |
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Prepaid expenses |
| - |
| - |
| (500) |
Accounts payable and Accrued liabilities |
| 1,442 |
| 546 |
| 2,042 |
Net cash used in operating activities |
| (22,483) |
| (19,156) |
| (107,278) |
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Investing Activities |
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Net cash provided by (used in) investing activities |
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| - |
| - |
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Financing Activities |
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Advance from related party |
| 10,000 |
| - |
| 10,000 |
Issuance of common stock for cash |
| - |
| - |
| 99,500 |
Net cash provided by financing activities |
| 10,000 |
| - |
| 109,500 |
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Net Increase (decrease) in Cash and Cash Equivalents |
| (12,483) |
| (19,156) |
| 2,222 |
Cash and cash equivalent position – beginning of period |
| 14,705 |
| 39,525 |
| - |
Cash and Cash Equivalents Position – End of Period | $ | 2,222 | $ | 20,369 | $ | 2,222 |
| Supplemental Cash Flow Disclosure: |
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Cash paid for interest | $ | - | $ | - | $ | - | ||
Cash paid for income taxes | $ | - | $ | - | $ | - | ||
- The accompanying notes are an integral part of these financial statements -
7
Mariposa Resources, Ltd. (An Exploration Stage Company) |
Notes to Interim Financial Statements |
March 31, 2009 |
(Unaudited) |
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1.
Organization
Mariposa Resources, Ltd. (the “Company”) was incorporated on May 31, 2006 in the State of Nevada, U.S.A. It is based in Miami, Florida, USA. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is June 30.
The Company is an exploration stage company that engages principally in the acquisition, exploration and development of resource properties. The Company has the right to conduct exploration work on 20 mineral mining claims in Esmeralda County, Nevada, U.S.A. and has not yet determined whether this property contains reserves that are economically recoverable. Prior to this, the Company’s activities have been limited to its formation and the raising of equity capital.
Exploration Stage Company
The Company is considered to be in the exploration stage as defined in Statement of Financial Accounting Standards (SFAS) No. 7, “Accounting and Reporting by Development Stage Enterprises,” and interpreted by the Securities and Exchange Commission for mining companies in Industry Guide 7. The Company is devoting substantially all of its efforts to development of business plans and the acquisition of mineral properties.
2.
Significant Accounting Policies
Use of Estimates
The preparation of financial statements in conformity with United States generally accepted accounting principles 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 amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s periodic filings with the Securities and Exchange Commission include, where applicable, disclosures of estimates, assumptions, uncertainties and markets that could affect the financial statements and future operations of the Company.
Cash and Cash Equivalents
Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value. The Company had $2,222 and $14,705 in cash and cash equivalents at March 31, 2009 and June 30, 2008, respectively.
Mineral Acquisition and Exploration Costs
The Company has been in the exploration stage since its formation in May 31, 2006 and has not yet realized any revenue from its planned operations. It is primarily engaged in the acquisition, exploration and development of mining properties. Mineral property acquisition and exploration costs are expensed as incurred. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property, are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserves.
8
Mariposa Resources, Ltd. (An Exploration Stage Company) |
Notes to Interim Financial Statements |
March 31, 2009 |
(Unaudited) |
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2.
Significant Accounting Policies-Continued
Start-Up Costs
In accordance with the American Institute of Certified Public Accountant’s Statement of Position 98-5, “Reporting on the Costs of Start-up Activities”, the Company expenses all costs incurred in connection with the start-up and organization of the Company.
Fair Value of Financial Instruments and Derivative Financial Instruments
The Company has adopted Statement of Financial Accounting Standards (“SFAS”) Number 119, “Disclosure About Derivative Financial Instruments and Fair Value of Financial Instruments.” The carrying amounts of cash and cash equivalents, accounts payable, accrued liabilities and amount due to related party approximate their fair values because of the short maturity of these items. Certain fair value estimates may be subject to and involve, uncertainties and matters of significant judgment, and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. The Company does not hold or issue financial instruments for trading purposes, nor does it utilize derivative instruments in the management of its foreign exchange, commodity price or interest rate market risks.
Segmented Reporting
SFAS Number 131, “Disclosure About Segments of an Enterprise and Related Information”, changed the way public companies report information about segments of their business in their quarterly reports issued to shareholders. It also requires entity-wide disclosures about the products and services an entity provides, the material countries in which it holds assets and reports revenues and its major customers. The company presently operates only in the United States.
Concentrations of Credit Risk
The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents and related party payables it will likely incur in the near future. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.
Earnings (Loss) per Share of Common Stock
The Company has adopted Financial Accounting Standards Board (“FASB”) Statement Number 128, “Earnings per Share,” (“EPS”) which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying financial statements, basic earnings (loss) per share is computed by dividing net income/loss by the weighted average number of shares of common stock outstanding during the period.
The Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.
9
Mariposa Resources, Ltd. (An Exploration Stage Company) |
Notes to Interim Financial Statements |
March 31, 2009 |
(Unaudited) |
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2.
Significant Accounting Policies– Continued
Foreign Currency Translations
The Company’s functional and reporting currency is the US dollar. All transactions initiated in other currencies are translated into the US dollars using the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currencies are translated into the US dollar at the rate of exchange in effect at the balance sheet date. Unrealized exchange gains and losses arising from such transactions are deferred until realization and are included as a separate component of shareholders’ equity (deficit) as a component of comprehensive income or loss. Upon realization, the amount deferred is recognized in income in the period when it is realized.
No significant realized exchange gain or losses were recorded from inception (May 31, 2006) to March 31, 2009.
Comprehensive Income (Loss)
SFAS No. 130, “Reporting Comprehensive Income”, establishes standards for reporting and display of comprehensive income and its components in a full set of general-purpose financial statements. From inception (May 31, 2006) to March 31, 2009, the Company had no items of other comprehensive income. Therefore, net loss equals comprehensive loss from inception (May 31, 2006) to March 31, 2009.
Risks and Uncertainties
The Company operates in the resource exploration industry that is subject to significant risks and uncertainties, including financial operational, technological and other risks associated with operating a resource exploration business, including the potential risk of business failure.
Environmental Expenditures
The operations of the Company have been, and may in the future be, affected from time to time in varying degree by changes in environmental regulations, including those for future reclamation and site restoration costs. Both the likelihood of new regulations and their overall effect upon the company vary greatly and are not predictable. The Company's policy is to meet or, if possible, surpass standards set by relevant legislation by application of technically proven and economically feasible measures.
Environmental expenditures that relate to ongoing environmental and reclamation programs are charged against earnings as incurred or capitalized and amortized depending on their future economic benefits. All of these types of expenditures incurred since inception have been charged against earnings due to the uncertainty of their future recoverability. Estimated future reclamation and site restoration costs, when the ultimate liability is reasonably determinable, are charged against earnings over the estimated remaining life of the related business operation, net of expected recoveries.
10
Mariposa Resources, Ltd. (An Exploration Stage Company) |
Notes to Interim Financial Statements |
March 31, 2009 |
(Unaudited) |
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2.
Significant Accounting Policies–Continued
Recent Accounting Pronouncements
Recent accounting pronouncements that are listed below did and/or are not currently expected to have a material effect on the Company’s financial statements, but will be implemented in the Company’s future financial reporting when applicable.
FASB Statements:
In May 2008, the FASB issued SFAS No. 163,“Accounting for Financial Guarantee Insurance Contracts – an interpretation of FASB Statement No. 60.” Diversity exists in practice in accounting for financial guarantee insurance contracts by insurance enterprises under FASB Statement No. 60,“Accounting and Reporting by Insurance Enterprises.”That diversity results in inconsistencies in the recognition and measurement of claim liabilities because of differing views about when a loss has been incurred under SFAS No. 5,“Accounting for Contingencies.”This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements. This Statement is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years.
In May 2008, the FASB issued SFAS No. 162,“The Hierarchy of Generally Accepted Accounting Principles.”This Statement identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). This Statement is effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board amendments to AU Section 411,“The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles.”
In March 2008, the FASB issued SFAS No. 161, “Disclosure about Derivative Instruments and Hedging Activities – an amendment to FASB Statement No. 133.” The use and complexity of derivative instruments and hedging activities have increased significantly over the past several years. Constituents have expressed concerns that the existing disclosure requirements in SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities”, do not provide adequate information about how derivative and hedging activities affect an entity’s financial position, financial performance, and cash flows. Accordingly, this Statement requires enhanced disclosures about an entity’s derivative and hedging activities and thereby improves the transparency of financial reporting. This Statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008.
11
Mariposa Resources, Ltd. (An Exploration Stage Company) |
Notes to Interim Financial Statements |
March 31, 2009 |
(Unaudited) |
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2.
Significant Accounting Policies–Continued
FASB Statements- Continued:
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 No. 51 to improve the relevance, comparability, and transparency of the financial information that a reporting entity provides in its consolidated financial statements by establishing accounting and reporting standards of the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. SFAS No. 160 is effective for fiscal years, and interim periods with those fiscal years, beginning on or after December 15, 2008 (that is, January 1, 2009, for entities with calendar year-ends).
In December 2007, the FASB issued a revision to SFAS No. 141 (revised 2007),“Business Combinations.” The objective of this Statement is to improve the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial reports about a business combination and its effects. 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.
3.
Capital Stock
Authorized Stock
At inception, the Company authorized 100,000,000 common shares and 100,000,000 preferred shares, both with a par value of $0.001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.
Effective April 8, 2009, the Company increased the number of authorized shares to 600,000,000 shares, of which 500,000,000 shares are designated as common stock par value $0.001 per share, and 100,000,000 shares are designated as preferred stock, par value $0.001 per share.
Share Issuances
Effective April 30, 2009, the Company effected a 10 for 1 forward split of its common stock, under which each stockholder of record on that date received ten (10) new shares of the Corporation’s $0.001 par value stock for every one (1) old share outstanding.
Since its inception (May 31, 2006), the Company has issued shares of its common stock as follows, retroactively adjusted to give effect to the 10 for 1 forward split:
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Date | Description | Shares | Share | Amount |
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06/06/06 | Shares issued for cash | 20,000,000 | $ 0.001 | $ 20,000 |
07/01/06 | Shares issued for cash | 10,000,000 | 0.001 | 10,000 |
12/11/06 | Shares issued for cash | 17,375,000 | 0.004 | 69,500 |
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03/31/09 | Cumulative Totals | 47,375,000 |
| $ 99,500 |
12
Mariposa Resources, Ltd. (An Exploration Stage Company) |
Notes to Interim Financial Statements |
March 31, 2009 |
(Unaudited) |
|
3.
Capital Stock -Continued
Of these shares, 30,000,000 were issued to directors and officers of the Company and 17,375,000 were issued to independent investors.
There are no preferred shares outstanding. The Company has no stock option plan, warrants or other dilutive securities.
4.
Income Taxes
The Company recognizes the tax effects of transactions in the year in which such transactions enter into the determination of net income, regardless of when reported for tax purposes. Deferred taxes are provided in the financial statements under SFAS No. 109 to give effect to the resulting temporary differences which may arise from differences in the bases of fixed assets, depreciation methods, allowances, and start-up costs based on the income taxes expected to be payable in future years.
Minimal exploration stage deferred tax assets arising as a result of net operating loss carryforwards have been offset completely by a valuation allowance due to the uncertainty of their utilization in future periods. Operating loss carryforwards generated during the period from May 31, 2006 (date of
inception) through March 31, 2009 of approximately $108,820 will begin to expire in 2026. Accordingly, deferred tax assets of approximately $38,000 were offset by the valuation allowance that increased by approximately $9,000 and $7,000 during the nine months ended March 31, 2009 and 2008, respectively.
5.
Mineral Property Costs
By agreement dated July 27, 2006 with Gold Explorations LLC, of Minden, Nevada, the Company acquired an option to earn a 100% interest in certain properties consisting of 20 unpatented mineral claims, located in Esmeralda County, Nevada, USA.
Upon execution of the agreement, Gold Explorations LLC transferred 100% interest in the mineral claims to the Company for $53,000 to be paid, at the Company’s option, as follows:
| Cash Payments | ||
Upon signing of the agreement and transfer of title (paid) | $ | 5,000 | |
On or before July 27, 2007 (paid) |
| 5,000 | |
On or before July 27, 2008 (paid) |
| 8,000 | |
On or before July 27, 2009 |
| 10,000 | |
On or before July 27, 2010 |
| 10,000 | |
On or before July 27, 2011 |
| 15,000 | |
| $ | 53,000 | |
All payments shall be made within 30 days of the due date or the Property and all rights will revert back to Gold Explorations LLC.
In addition, the Company must incur exploration expenditures of $50,000 on the Property by July 27, 2011. The Company had a report recommending a work program of approximately $22,000. The program consisted of surveying a control grid, soil and rock chip sampling and geological mapping.
13
Mariposa Resources, Ltd. (An Exploration Stage Company) |
Notes to Interim Financial Statements |
March 31, 2009 |
(Unaudited) |
|
5.
Mineral Property Costs -Continued
A total of $25,191 was advanced during April – June 2007 and the work program was completed prior to the year ended June 30, 2007.
The Company is also responsible for maintaining the mineral claims in good standing by paying all the necessary rents, taxes, and filing fees associated with the Property. As of March 31, 2009, the Company met these obligations.
The property is subject to a 3% royalty, to Gold Explorations LLC, on all mineral commodities sold from the property. This royalty shall be reduced to 1.5% upon payment to the Vendor of $1,000,000 USD at any time
6.
Due to Related Party
As of March 31, 2009, the Company was obligated to a director, who is also an officer and stockholder, for a non-interest bearing demand loan with a balance of $10,000. The Company plans to pay the loan back as cash flows become available. Interest has not been imputed on these advances due to its immaterial impact on the financial statements.
7.
Going Concern and Liquidity Considerations
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. As at March 31, 2009, the Company had a working capital deficiency of $9,320 and an accumulated deficit of $108,820. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the next twelve months.
The ability of the Company to emerge from the exploration stage is dependent upon, among other things, obtaining additional financing to continue operations, explore and develop the mineral properties and the discovery, development and sale of ore reserves.
In response to these problems, management intends to raise additional funds through public or private placement offerings.
These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
8.
Subsequent Events
On April 8, 2009, the Company amended its Articles of Incorporation to increase the number of authorized common shares from 1000,000,000 to 500,000,000. The Company authorized a 10 for 1 forward stock split effective April 30, 2009. As discussed in Note 3, both the amendment and stock split have been retroactively reported for all periods presented in the accompanying financial statements.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward Looking Statements
Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements include, among others, those statements including the words “expects,” “anticipates,” “intends,” “believes” and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed herein as well as in the “Description of Business – Risk Factors” section in our Annual Report on Form 10-K for the year ended June 30, 2008. You should carefully review the risks described in our Annual Report and in other documents we file from time to time with the Securities and Exchange Commission. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.
Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.
All references in this Form 10-Q to the “Company,” “Mariposa,” “we,” “us” or “our” are to Mariposa Resources, Ltd.
General Overview
We were incorporated in the State of Nevada on May 31, 2006, to engage in the acquisition, exploration and development of mineral deposits and reserves. On July 27, 2006, we entered into a Mineral Claim Purchase Agreement (the “Agreement”) to which we acquired an option to purchase an undivided interest in 20 unpatented mineral claims, consisting of 400 acres on property located in Esmeralda County, Nevada, USA. Under the terms of the Agreement, we agreed to pay $53,000 and agreed to make exploration expenditures on the property of $50,000 over a five year period. During the initial exploration, no commercial quantities of gold or other minerals were discovered and in June 2007, we ceased exploration on the prospect. We do not claim to have any minerals or reserves whatsoever at this time on any of the property. Our management has no current plans for the property at this time, and all of our exploration operations have been discontinued. Following the discontinuation of our planned mineral acquisition, exploration and development activities through the present, we have determined to look at other ventures of merit to enhance stockholder value. These ventures may involve sales of our debt or equity security in merger, acquisition, or similar transactions. To date, we have achieved no operating revenues and have yet to engage in any such ventures.
Results of Operations
We have generated no revenues since inception and have incurred $108,820 in expenses through March 31, 2009.
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The following table provides selected financial data about our company for the period ended March 31, 2009 and the year ended June 30, 2008, respectively.
Balance Sheet Data:
03/31/09
6/30/08
Cash
$ 2,222
$ 14,705
Total assets
$ 2,722
$ 15,205
Total liabilities
$ 12,042
$ 600
Shareholders' equity (deficit) $ (9,320)
$ 14,605
Net cash provided by financing activities since inception through March 31, 2009, was $109,500, consisting of $30,000 raised from the sale of common shares to our directors, $69,500 from the sale of shares through our SB-2 registration statement to non-affiliated individuals and $10,000 in loans from an officer and director of the Company.
Plan of Operation
We were formed to engage in the acquisition, exploration and development of mineral deposits and reserves. We conducted minimal operations in this line of business. We have experienced difficulties in obtaining financing for our business and have shifted some of our focus to investigating other business opportunities. These opportunities include possible acquisitions or joint venture arrangements in this and other industries. We can provide no assurance that these efforts in exploring possible acquisitions or joint venture arrangements will come to fruition. Additionally, if any new ventures are successfully negotiated, we can provide no assurance that such new venture will have enough financial resources to fully develop the new venture. Although we will continue to explore financing options based upon our existing business plan, our plan of operations for the next 12 months will also include further investigation of forming partnerships with other entities and researching other business opportunities.
We have minimal operating costs and expenses at the present time due to our limited business activities. However, because of our limited cash in the bank, we will be required to raise additional capital over the next twelve months to meet our ongoing expenses, including our costs related to the remaining required payments under the mining claims purchase agreement we signed in July 27, 2006.
Further, we may raise capital in connection with or in anticipation of possible acquisition transactions. We do not currently engage in any product research and development and have no plans to do so in the foreseeable future. We have no present plans to purchase or sell any plant or significant equipment. We also have no present plans to add employees, although we may do so in the future if we engage in any merger or acquisition transactions.
Liquidity and Capital Resources
Our external auditors issued a going concern opinion on our June 30, 2008, audited financial statements that raises substantial doubt about our ability to continue as a going concern for the next 12 months given our current financial position. We have minimal assets and have achieved no operating revenues since our inception. We have depended on loans and sales of equity securities to conduct operations. As of March 31, 2009, we had cash of $2,222, current assets of $2,722 and current liabilities of $12,042. Unless and until we commence material operations and achieve material revenues, we will remain dependent on financings to continue our operations. This financing may take the form of additional sales of debt or equity securities and/or loans from our directors. We have no agreements in place, orally or in
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writing, with any director at this time. There is no assurance that additional financing, if required, will be available, or available on terms favorable to us.
Off-Balance Sheet Arrangements
We do not have any 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 are material to investors.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not required by smaller reporting companies.
ITEM 4T. CONTROLS AND PROCEDURES
Evaluation of Our Disclosure Controls and Internal Controls
Our management is responsible for establishing and maintaining adequate internal control over financial reporting.Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes of accounting principles generally accepted in the United States. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to not be effective can provide only reasonable assurance of achieving their control objectives.The determination of ineffective internal control is based upon the lack of separation of duties. Management has worked with its auditors, Moore and Associates, Charted, to correct these deficiencies in this Form 10-Q, in order to ensure that material information about out business and operations is recorded, processed, summaried and publicly reported with the timeperiods required under the Exchange Act, and that this information is accumulated and communicated to our management to allow timely decisions about required disclosures. In evaluating the effectiveness of our internal control over financial reporting, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control – Integrated Framework.
Under the supervision and with the participation of our senior management, including our chief executive officer and chief financial officer, Nanuk Warman, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this quarterly report (the “Evaluation Date”). Based on this evaluation, our chief executive officer and chief financial officer concluded as of the Evaluation Date that our disclosure controls and procedures were not effective such that the information relating to us required to be disclosed in our Securities and Exchange Commission (“SEC”) reports (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.
Officers’ Certifications
Appearing as exhibits to this quarterly report are “Certifications” of our Chief Executive Officer and Chief Financial Officer. The Certifications are required pursuant to Section 302 of the Sarbanes-Oxley
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Act of 2002 (the “Section 302 Certifications”). This section of the Quarterly Report contains information concerning the Controls Evaluation referred to in the Section 302 Certification. This information should be read in conjunction with the Section 302 Certifications for a more complete understanding of the topics presented.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2009 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 1A. RISK FACTORS
Not applicable.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECUIRITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
As more fully discussed in our Form 8-K filed with the Securities and Exchange Commission on April 21, 2009, on April 8, 2009, our stockholders and Board of Directors approved resolutions to amend our Articles of Incorporation (the “Amendment”) which Amendment was filed with the Secretary of State of the State of Nevada on April 8, 2009, to effect an increase in the number of our authorized capital shares to 600,000,000 shares, of which 500,000,000 shares are designated as common stock, par value $0.001 per share, and 100,000,000 shares are designated as preferred stock, par value $0.001 per share. We may issue the shares of Preferred Stock from time to time in one or more classes or series, each of which class or series shall have such distinctive designation or title as shall be fixed by the Board or any committee thereof established by resolution of the Board pursuant to our Bylaws prior to the issuance of any shares thereof; each such class or series of Preferred Stock shall have such voting powers, full or limited, or no voting powers, and such preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof, as shall be stated in such resolution or resolutions providing for the issuance of such class or series of Preferred Stock as may be adopted from time to time by the Board prior to the issuance of any shares thereof, all in accordance with the laws of the State of Nevada.
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ITEM 5. OTHER INFORMATION
Forward Stock Split
On April 8, 2009, our Board of Directors approved a ten-for-one (10:1) forward split of our Common Stock. The forward split was legally effective as of the close of business on Wednesday, April 29, 2009 and following FINRA approval, the market effective date for the reverse stock split was May 6, 2009. As a result of the forward stock split, every one share of our old Common Stock were converted into ten shares of our new Common Stock.
NASDAQ issued a new symbol under which our Common Stock will trade. That symbol is “MPOA.” A new CUSIP number has been issued for our new Common Stock (“57027F 204”) to distinguish stock certificates issued after the effective date of the forward stock split. Our old CUSIP number was “57027F 105.”
ITEM 6. EXHIBITS
The following exhibits are included with this filing:
Exhibit
Number
Description
31
Rule 13a-14(a)/15d-14a(a) Certifications
32
Section 1350 Certifications
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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.
| MARIPOSA RESOURCES, LTD. | |
| (Registrant) | |
May 8, 2009 |
|
|
_____________________________ | BY: | /s/ Nanuk Warman |
Date |
|
|
|
| Nanuk Warman |
|
| President, Chief Executive Officer, Principal Financial Officer, Principal Accounting Officer, and member of the Board of Directors |
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