UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||||||||||||||
For the quarterly period ended March 31, 2012
or
| o | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||||||||||||||
For the transition period from _________ to _________
Commission File Number 001-33715
| OKANA VENTURES, INC. | ||||||||||||||||||||
| (Exact name of registrant as specified in its charter) |
| Nevada | 20-2881151 | |
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
| Moliere No. 222, Torre de Oficinas, Col. Los Morales Polanco, Delgacion Miguel Hidalgo, Mexico City, Mexico | N/A | |
| (Address of principal executive offices) | (Zip Code) |
775-636-6986
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
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 o
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 x NO o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small 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 | o | Accelerated filer | o | |
| Non-accelerated filer | o | (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 o NO x
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.
YES o NO o
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
3,441,667 common shares issued and outstanding as of May 10, 2012.
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements.
In the opinion of management, the accompanying balance sheets and related interim statements of income, cash flows, and stockholders’ equity include all adjustments, consisting only of normal recurring items, necessary for their fair presentation in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with information included in our most recent annual report on Form 10-K for the year ended December 31, 2011.
2
OKANA VENTURES, INC.
(AN EXPLORATION STAGE COMPANY)
INDEX TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Page(s) | ||||
| Balance Sheets as of March 31, 2012 (unaudited) and December 31, 2011 | F-1 | |||
| Statements of Operations and Comprehensive Loss for the Three Months Ended March 31, 2012 and 2011 with Cumulative Totals Since Inception (unaudited) | F-2 | |||
| Statements of Cash Flows for the Three Months Ended March 31, 2012 and 2011 with Cumulative Totals Since Inception (unaudited) | F-3 | |||
| Notes to Financial Statements | F-4 | |||
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| OKANA VENTURES, INC. | ||||||||
| (AN EXPLORATION STAGE COMPANY) | ||||||||
| BALANCE SHEETS | ||||||||
| ASSETS | ||||||||
| MARCH 31 | DECEMBER 31, | |||||||
| 2012 | 2011 | |||||||
| (Unaudited) | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | $ | 9,935 | $ | 18,766 | ||||
| Total Current Assets | 9,935 | 18,766 | ||||||
| TOTAL ASSETS | $ | 9,935 | $ | 18,766 | ||||
| LIABILITIES AND STOCKHOLDERS' (DEFICIT) | ||||||||
| LIABILITIES | ||||||||
| Current Liabilities | ||||||||
| Accounts payable | $ | 5,538 | $ | 3,988 | ||||
| Notes and loans payable to stockholder | 113,959 | 113,558 | ||||||
| Total Current Liabilities | 119,497 | 117,546 | ||||||
| Total Liabilities | 119,497 | 117,546 | ||||||
| STOCKHOLDERS' (DEFICIT) | ||||||||
| Common stock, par value $.0001, 100,000,000 shares authorized and | ||||||||
| 3,441,667 shares issued and outstanding | 344 | 344 | ||||||
| Additional paid-in capital | 117,413 | 115,650 | ||||||
| Deficit accumulated during the pre-exploration and exploration stages | (225,066 | ) | (212,922 | ) | ||||
| Cumulative other comprehensive gain or (loss) | (2,253 | ) | (1,852 | ) | ||||
| Total Stockholders' (Deficit) | (109,562 | ) | (98,780 | ) | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT) | $ | 9,935 | $ | 18,766 | ||||
The accompanying notes are an integral part of these financial statements.
F-1
| (AN EXPLORATION STAGE COMPANY) | ||||||||||
| STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||||||||||
| (Unaudited) |
THREE MONTHS ENDED MARCH 31, | Cumulative Totals May 9, 2005(Inception) | |||||||||||
| 2012 | 2011 | to March 31, 2012 | ||||||||||
| INCOME | ||||||||||||
| OPERATING EXPENSES | ||||||||||||
| Organizational expenses | $ | - | $ | - | $ | 1,097 | ||||||
| Mineral property costs | - | - | 52,540 | |||||||||
| Consulting | - | - | 1,200 | |||||||||
| Professional fees | 7,000 | 6,000 | 104,065 | |||||||||
| Administrative expenses | 3,381 | 1,709 | 48,801 | |||||||||
| Taxes and licenses | - | - | 375 | |||||||||
| Total Operating Expenses | 10,381 | 7,709 | 208,078 | |||||||||
| OTHER INCOME AND (EXPENSE) | ||||||||||||
| Miscellaneous consulting income | - | - | 7,224 | |||||||||
| Interest, net | (1,763 | ) | (1,677 | ) | (24,212 | ) | ||||||
| Total other income and (expense) | (1,763 | ) | (1,677 | ) | (16,988 | ) | ||||||
| NET LOSS APPLICABLE TO COMMON SHARES | $ | (12,144 | ) | $ | (9,386 | ) | $ | (225,066 | ) | |||
| Foreign currency translation adjustment | (401 | ) | (841 | ) | (2,253 | ) | ||||||
| COMPREHENSIVE LOSS | $ | (12,545 | ) | $ | (10,227 | ) | $ | (227,319 | ) | |||
| NET LOSS PER BASIC AND DILUTED SHARES | $ | (0.00 | ) | $ | (0.00 | ) | ||||||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | 3,441,667 | 3,350,000 | ||||||||||
The accompanying notes are an integral part of these financial statements.
F-2
| OKANA VENTURES, INC. | ||||||
| (AN EXPLORATION STAGE COMPANY) | ||||||
| STATEMENTS OF CASH FLOWS | ||||||
| (Unaudited) |
THREE MONTHS ENDED MARCH 31, | Cumulative Totals May 9, 2005(Inception) | |||||||||||
| 2012 | 2011 | to March 31, 2012 | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||||
| Net loss | $ | (12,144 | ) | $ | (9,386 | ) | $ | (225,066 | ) | |||
| Adjustments to reconcile net loss to net cash | ||||||||||||
| (used in) operating activities | ||||||||||||
| Interest expense - related party | 1,763 | 1,553 | 23,257 | |||||||||
| Changes in assets and liabilities | ||||||||||||
| Increase (decrease) in accounts payable | 1,550 | (3,009 | ) | 5,538 | ||||||||
| Total adjustments | 3,313 | (1,456 | ) | 28,795 | ||||||||
| Net cash (used in) operating activities | (8,831 | ) | (10,842 | ) | (196,271 | ) | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||||
| Net cash (used in) investing activities | - | - | - | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||||
| Sale of common stock | - | - | 94,500 | |||||||||
| Proceeds from notes and loans payable to stockholders | - | 11,677 | 113,558 | |||||||||
| Net cash provided by financing activities | - | 11,677 | 208,058 | |||||||||
| EFFECT OF FOREIGN CURRENCY | ||||||||||||
| TRANSLATION ADJUSTMENT | - | (841 | ) | (1,852 | ) | |||||||
| NET INCREASE (DECREASE) IN | ||||||||||||
| CASH AND CASH EQUIVALENTS | (8,831 | ) | (6 | ) | 9,935 | |||||||
| CASH AND CASH EQUIVALENTS - | ||||||||||||
| BEGINNING OF PERIOD | 18,766 | 58 | - | |||||||||
| CASH AND CASH EQUIVALENTS - END OF PERIOD | $ | 9,935 | $ | 52 | $ | 9,935 | ||||||
| SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||||||
Cash paid for interest | $ | - | $ | - | $ | - | ||||||
| Cash paid for taxes | $ | - | $ | - | $ | - | ||||||
| SUPPLEMENTAL DISCLOSURE OF NONCASH | ||||||||||||
| INVESTING AND FINANCIAL ACTIVITIES | ||||||||||||
| Imputed interest - related party contributed as capital | $ | 1,763 | $ | 1,553 | $ | 23,257 | ||||||
The accompanying notes are an integral part of these financial statements.
F-3
OKANA VENTURES, INC.
(AN EXPLORATION STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2012 AND 2011
(UNAUDITED)
NOTE 1- BASIS OF PRESENTATION
The accompanying unaudited financial statements of Okana Ventures, Inc. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's registration statement filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year 2011 as reported in Form 10-K, have been omitted.
NOTE 2 - NOTES AND LOANS PAYABLE TO STOCKHOLDERS
The Company’s current and previous President have advanced funds to the Company in exchange for demand notes at a zero interest rate. The Company’s former President, Michael Upton, assigned his debt of $102,010 to Ms. Peralta upon her appointment as President, Treasurer and Director in 2011. The Company imputes simple interest at 6% per annum as interest expense with the related-party donated interest as additional paid-in capital. The Company recorded related-party interest of $1,763 during the three months ended March 31, 2012 (2011 - $1,677), bringing total related-party interest to $23,257 from inception, May 9, 2005 to March 31, 2012.
In addition to the notes described above, unsecured advances of $11,548 from Ms. Peralta during the year ended December 31, 2011 brought the total notes and loans payable to Ms. Peralta to $113,959 (December 31, 2011 - $113,558).
Because the notes and loans payable to related-parties are due on demand, they are reported as current liabilities.
NOTE 3 - GOING CONCERN
The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, which contemplates continuation of the Company as a going concern. The Company has incurred an operating deficit since its inception, is in the exploration stage and has no recurring revenues. These items raise substantial doubt about the Company’s ability to continue as a going concern.
In view of these matters, realization of the assets of the Company is dependent upon its ability to meet its financial requirements through equity financing and future operations. These financial statements do not include adjustments relating to the recoverability and classification of asset amounts and classification of liabilities that might be necessary should the Company be unable to continue.
NOTE 4 - SUBSEQUENT EVENTS
The Company has evaluated events from March 31, 2012 through the date the financial statements were issued and has determined that there are no events required to be disclosed.
F-4
Item 2. Management’s Discussion and Analysis or Plan of Operations.
FORWARD-LOOKING STATEMENTS
This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors” that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.
In this annual report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in our capital stock.
As used in this current report and unless otherwise indicated, the terms "we", "us", "our" and "our company" mean Okana Ventures, Inc.
History
Okana Ventures, Inc. was incorporated on May 9, 2005, in the State of Nevada. We have conducted limited exploration activities on two former properties, the Westmoreland Property and the Bradley Creek Property, both located in British Columbia, Canada. Based on the results of our exploration efforts on these properties we decided not to proceed with any further exploration and terminated all related agreements.
We raised the minimum amount of $50,000 from our SB-2 offering, which closed on September 18, 2007. The funds raised, together with the loans and purchase of shares by the directors ($83,692 in loans and $17,000 in share purchases) provided us with sufficient funds to complete our initial exploration work program on the Westmoreland property which we had previously acquired. Based on the results from our initial exploration work program, we decided not to conduct any further exploration on this mining property. In April, 2008 we terminated the mineral purchase agreement and transferred title to the Westmoreland property back to Messrs. Gruenwald and MacInnis in accordance with the terms of the mineral purchase agreement. We also terminated our option to purchase agreement on the Bradley Creek property after limited exploration efforts. We have no further liability in relation to these mining properties.
Current Business
We are presently in the process of searching for another mining property that is still in its early exploration stage. We cannot guarantee that a commercially viable mineral deposit exists in any mining property we may acquire until we are able to perform further exploration and a comprehensive evaluation determines if it has economic feasibility.
4
At the present time, we have no plans to buy or sell any plant or significant equipment during the next twelve months.
Our exploration objective is to find an ore body containing gold. We must acquire a mining property that is in the early stage of development to carry out our exploration objective. We will conduct exploration to determine what amount of minerals, if any, exist on a mining property, and if any minerals which are found can be economically extracted and profitably processed. Our success depends upon finding mineralized material. Mineralized material is a mineralized body, which has been delineated by appropriate spaced drilling or underground sampling to support sufficient tonnage and average grade of metals to justify removal. If we locate mineralized material, we have to determine if it is economically feasible to remove the material. Economically feasible means that the costs associated with the removal of the mineralized material will not exceed the price at which we can sell the mineralized material. We cannot predict what the costs will be until we find mineralized material. Until we find enough mineralized material that is economically feasible to remove, we will have to continue to raise additional funds to carry out exploration of a mining property. We will try to raise additional funds from a second public offering, a private placement or loans. At the present time, we have not acquired any interest in a mining property or the right to acquire any interest in a mining property by the conduct of exploration and have not raised any additional money.
Our business is subject to the risks inherent with a natural resource based company in its early exploration stage of development. These risks include, but are not limited to: limited capital resources; limited industry operating experience; possible delays due to weather, manpower and equipment shortage and regulatory processing practices; possible cost overruns due to price increases in services, supplies and equipment; and the general speculative nature of exploring a raw mineral property for minerals.
At the present, we have no employees. We do not intend to hire any employees at this time. Any work on any property in which we acquire an interest will be conducted by unaffiliated independent contactors that we will hire. Depending on the stage of exploration we reach on any mineral property, the independent contractors will be responsible for surveying, geology, engineering, exploration, and excavation. The geologists will evaluate the information derived from the exploration and excavation and the engineers will advise us on the economic feasibility of removing any mineralized material we may find.
Our company’s common stock has been assigned the ticker symbol OKNV and has been approved for trading on the Over-The-Counter Bulletin Board. However, no trading market has developed.
Our principal office address is Moliere No. 222, Torre de Oficinas, Col. Los Morales Polanco, Delgacion Miguel Hidalgo, Mexico City, Mexico and our telephone number is (775) 636-6986.
We have no revenues, have achieved losses since inception, have no operations, have been issued a going concern opinion by our auditors and rely upon the sale of our securities and loans from our officers and directors to fund operations.
5
Results of Operations for the Three Months Ended March 31, 2012 and 2011
During the three months ended March 31, 2012 and 2011 we had no revenue.
Our net loss and comprehensive loss for the three months ended March 31, 2012 and 2011 for the respective items are summarized as follows:
| THREE MONTHS ENDED | ||||||||
| MARCH 31, | ||||||||
| 2012 | 2011 | |||||||
| Professional fees | 7,000 | 6,000 | ||||||
| Administrative expenses | 3,381 | 1,709 | ||||||
| Interest expense | 1,763 | 1,677 | ||||||
| NET LOSS APPLICABLE TO COMMON SHARES | (12,144 | ) | (9,386 | ) | ||||
| Foreign currency translation adjustment | (401 | ) | (841 | ) | ||||
| COMPREHENSIVE LOSS | (12,545 | ) | (10,227 | ) | ||||
From the three months ended March 31, 2011 to the three months ended March 31, 2012, accounting and auditors’ fees increased from $6,000 to $7,000, office and administrative fees increased from $1,709 to $3,381, both due to increased activities and interest expense increased from $1,677 to $1,763 due to increased loans from related parties.
For the period from inception (May 9, 2005) to March 31, 2012 we had no operating revenues and incurred net operating losses of $225,066 consisting of speculative mining expenses, general operating expenses and professional fees incurred in connection with the day-to-day operation of our business and filing of our periodic reports.
Liquidity and Financial Condition
Working Capital
At March 31, 2012 the Company had cash balance of $9,935 and working capital deficit of $109,562. At December 31, 2011 the Company had cash balance of $18,766 and working capital deficit of $98,780. During the three months ended March 31, 2012 we incurred and paid for expenses but did not raise cash.
Operating Activities
During the three months ended March 31, 2012 net cash used in operating activities was $8,831 compared with cash used in operating activities of $10,842 in the same period in 2011.
Investing Activities
Net cash used in investing activities was $Nil for the nine months ended March 31, 2012, compared to net cash provided by investing activities of $Nil in the same period in 2011.
Financing Activities
We had no cash from financing activities for the three months ended March 31, 2012 compared to $11,677 in the same period in 2011 which was advance from related parties.
Contractual Obligations
As a “smaller reporting company”, we are not required to provide tabular disclosure of our contractual obligations.
6
Going Concern
We are a start-up, exploration stage corporation and have not yet generated or realized any revenues from our business operations.
There is a substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. We have not generated any revenues and no revenues are anticipated until we acquire a mining property and carry out sufficient exploration and development work that would result in our being able to begin removing and selling minerals. Accordingly, we must raise cash from sources other than the sale of minerals found on any mining property we may acquire. Our only other source for cash at this time is investments by others. We must raise cash to acquire and undertake the exploration of a mining property and stay in business. We raised the minimum amount of $50,000 from our SB-2 offering, which closed on September 18, 2007. The funds raised, together with the loans and purchase of shares by the directors ($83,692 in loans and $17,000 in share purchases) provided us with sufficient funds to complete our initial exploration work program on the Westmoreland property which we had previously acquired. Based on the results from our initial exploration work program, we decided not to conduct any further exploration on this mining property. In April, 2008 we terminated the mineral purchase agreement and transferred title to the Westmoreland property back to Messrs. Gruenwald and MacInnis in accordance with the terms of the mineral purchase agreement. We also terminated our option to purchase agreement on the Bradley Creek property after limited exploration efforts. We have no further liability in relation to these mining properties.
We are currently searching for a mining property in its early stage of development upon which to conduct exploration. At the present time, we have no plans to buy or sell any plant or significant equipment during the next twelve months. We will try to raise additional funds from a second public offering, a private placement or loans. At the present time, we have not acquired any interest in a mining property or the right to acquire any interest in a mining property by the conduct of exploration and have not raised any additional money.
Off-Balance Sheet Arrangements
We have no 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.
Critical Accounting Policies
We have identified certain accounting policies that are most important to the portrayal of our current financial condition and results of operations. Please refer to our Form 10-K for the year ended December 31, 2011 filed with the SEC for our critical accounting policies, from which there has been no change as of the date of this file.
7
Recent Accounting Pronouncements
During the period ended March 31, 2012 and subsequently, the Financial Accounting Standards Board (“FASB”) has issued a number of financial accounting standards, none of which did or are expected to have a material impact on our company’s results of operations, financial position, or cash flows.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
As a "smaller reporting company", we are not required to provide the information required by this Item.
Item 4. Controls and Procedures
Management's Report on Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our president (our principal executive officer, principal financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure.
As of March 31, 2012, the end of our quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our President (our Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our President (our Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.
Changes In Internal Control Over Financial Reporting
There have been no changes in our internal controls over financial reporting that occurred during our quarter ended March 31, 2012, that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.
8
PART II — OTHER INFORMATION
Item 1. Legal Proceedings
We know of no material, existing or pending legal proceedings against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, executive officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest.
Item 1A. Risk Factors
Much of the information included in this annual report includes or is based upon estimates, projections or other "forward looking statements". Such forward looking statements include any projections or estimates made by us and our management in connection with our business operations. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein.
Such estimates, projections or other "forward looking statements" involve various risks and uncertainties as outlined below. We caution the reader that important factors in some cases have affected and, in the future, could materially affect actual results and cause actual results to differ materially from the results expressed in any such estimates, projections or other "forward looking statements".
Our common shares are considered speculative during the development of our new business operations. Prospective investors should consider carefully the risk factors set out below.
Our independent auditors have expressed substantial doubt about our ability to continue as a going concern.
Our net loss since inception is $225,066. There can be no assurance that will generate significant revenues or achieve profitable operations.
These circumstances raise substantial doubt about our ability to continue as a going concern, as described in Note 8 of our financial statements for the year ended December 31, 2011, which are included in this annual report on Form 10-K. Such factors identified in the note are our accumulated deficit since inception, our failure to attain profitable operations and our dependence upon adequate financing to pay our liabilities. If we are not able to continue as a going concern, it is likely investors will lose their investments.
We are an early stage company with no history of revenues making it difficult to evaluate whether we will operate profitably.
We are an early-stage development company. We do not have a meaningful historical record of sales and revenues nor an established business track record. We are presently in the process of searching for another mining property that is still in its early exploration stage. We cannot guarantee that a commercially viable mineral deposit exists in any mining property we may acquire until we are able to perform further exploration and a comprehensive evaluation determines if it has economic feasibility.
9
Exploration of mineral properties is speculative, we may never discover minerals, our business may fail and investors may lose their entire investment.
There is no assurance that exploration of any future mining property we may acquire will establish that commercially exploitable reserves of minerals exist and may be accessed at reasonable cost. There may be additional problems that prevent us from discovering any reserves of minerals on our future properties including problems relating to exploration and additional costs and expenses that may exceed current estimates. If we are unable to establish the presence of commercially exploitable reserves of minerals on our future properties, our ability to fund future exploration activities will be impeded, we will not be able to operate profitably and investors may lose all of their investment in our company.
Potential investors should be aware of the difficulties normally encountered by new mineral exploration companies and the high rate of failure of such companies. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the mineral properties that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates. The expenditures to be made by us in the exploration of the mineral claim may not result in the discovery of mineral deposits. Problems such as unusual or unexpected formations and other conditions are involved in mineral exploration and often result in unsuccessful exploration efforts. If the results of our exploration do not reveal viable commercial mineralization, we may decide to abandon our claims. If this happens, our business will likely fail.
We may never become commercially viable and we may be forced to cease operations.
The commercial feasibility of mineral properties is dependent upon many factors beyond our control, including the existence and size of mineral deposits in the properties we explore, the proximity and capacity of processing equipment, market fluctuations of prices, taxes, royalties, land tenure, allowable production and environmental regulation. These factors cannot be accurately predicted and any one or a combination of these factors may result in our company not receiving an adequate return on invested capital. These factors may have material and negative effects on our financial performance and our ability to continue operations.
We may be adversely affected by fluctuations in ore and precious metal prices.
The value and price of our shares of common stock, our financial results, and our exploration, development and mining activities, if any, may be significantly adversely affected by declines in the price of precious metals and ore. Mineral prices fluctuate widely and are affected by numerous factors beyond our control such as interest rates, exchange rates, inflation or deflation, fluctuation in the value of the United States dollar and foreign currencies, global and regional supply and demand, and the political and economic conditions of mineral producing countries throughout the world.
The prices used in making resource estimates for mineral projects are disclosed, and generally use significantly lower metal prices than daily metals prices quoted in the news media. The percentage change in the price of a metal cannot be directly related to the estimated resource quantities, which are affected by a number of additional factors. For example, a 10% change in price may have little impact on the estimated resource quantities, or it may result in a significant change in the amount of resources.
Supplies needed for exploration may not always be available.
There is no guarantee we will be able to obtain certain products, equipment and/or materials as and when needed, without interruption, or on favourable terms. Such delays could affect our proposed business plans.
We may incur liability or damages as we conduct our business.
We may become subject to liability for hazards common in the industry, including pollution, cave-ins and other hazards against which we cannot insure or against which we may elect not to insure. We currently have no coverage to insure against these hazards and the payment of such liabilities would have a material adverse effect on our financial position.
10
We do not expect to declare or pay any dividends.
We have not declared or paid any dividends on our common stock since our inception, and we do not anticipate paying any such dividends for the foreseeable future.
Because the SEC imposes additional sales practice requirements on brokers who deal in our shares which are penny stocks, some brokers may be unwilling to trade them. This means that you may have difficulty in reselling your shares and may cause the price of the shares to decline.
Our shares qualify as penny stocks and are covered by Section 15(g) of the Securities Exchange Act of 1934 which imposes additional sales practice requirements on broker/dealers who sell our securities in this offering or in the aftermarket. For sales of our securities, the broker/dealer must make a special suitability determination and receive from you a written agreement prior to making a sale to you. Because of the imposition of the foregoing additional sales practices, it is possible that brokers will not want to make a market in our shares. This could prevent you from reselling your shares and may cause the price of the shares to decline.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosure
None.
Item 5. Other Information
None.
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Item 6. Exhibits
| Exhibit No. | Description | |
| (3) | (i) Articles of Incorporation; and (ii) Bylaws | |
| 3.1 | Articles of Incorporation (incorporated by reference to our current report on Form SB-2 filed on October 20, 2006) | |
| 3.2 | Bylaws (incorporated by reference to our current report on Form SB-2 filed on October 20, 2006) | |
| 3.3 | Amendment to Bylaws (incorporated by reference to our current report on Form SB-2 filed on October 20, 2006) | |
| (31) | Rule 13a-14(a)/15d-14(a) Certification | |
| 31.1* | Section 302 Certification under Sarbanes-Oxley Act of 2002 of the Chief Executive Officer and Chief Financial Officer | |
| (32) | Section 1350 Certification | |
| 32.1* | Section 906 Certification under Sarbanes-Oxley Act of 2002 of the Chief Executive Officer and Chief Financial Officer |
| 101.INS ** | XBRL Instance Document | |
| 101.SCH ** | XBRL Taxonomy Extension Schema Document | |
| 101.CAL ** | XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF ** | XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB ** | XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE ** | XBRL Taxonomy Extension Presentation Linkbase Document |
* Filed herewith.
** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
| OKANA VENTURES, INC. | ||
| (Registrant) | ||
| Dated: May 10, 2012 | /s/ Maria Peralta | |
| Maria Peralta | ||
President, Chief Executive Officer, Chief Financial Officer, Treasurer, Secretary and Director | ||
(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) |
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