UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended April 30, 2006
----------------
[] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT For
the transition period from _____________ to______________
Commission file No. 0-30770
-------
BRAVO RESOURCE PARTNERS LTD.
-----------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Yukon, British Columbia 04-3779327
---------------------------- ----------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2993 South Peoria St., Suite 302
Aurora, Colorado
80014
-----------------------------------------------------------------
(Address of principal executive offices) Zip Code
(303) 261-1370
-----------------------------------------------------------------
(Issuer's telephone number)
N/A
-----------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 [] NO [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 []
As of As of March 17, 2006, Bravo Resource Partners Ltd had 9,607,470 issued and
outstanding shares of common stock.
Transitional Small Business Disclosure format (Check one): YES [] NO [X]
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
BRAVO RESOURCE PARTNERS LTD.
CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
April 30, 2006
BRAVO RESOURCE PARTNERS, LTD.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEET
(Unaudited)
============================================================================
April 30,
2006
- ----------------------------------------------------------------------------
ASSETS
Current
Cash and cash equivalents $ 3,946
Accounts receivable
3,196
Prepaid expenses
1,350
Deferred tax asset, less valuation allowance of $805,962 --
-----------
Total current assets
8,492
Property and equipment
Equipment
193,667
Furniture
18,050
Software
149
-----------
Total property and equipment
211,866
Accumulated depreciation
(28,841)
-----------
Net property and equipment
183,025
Investment in television programs
20,397
-----------
Total Assets $ 211,914
===========
LIABILITIES AND DEFICIENCY IN ASSETS
Current liabilities
Accounts payable and accrued liabilities $ 131,726
-----------
Total current liabilities
131,726
Long-term liabilities
Due to related parties
715,172
-----------
Total liabilities
846,898
-----------
Commitments and contingencies (Notes 1, 4, and 5)
Deficiency in assets
Preferred stock: 100,000,000 shares authorized --
-----------
Common stock: No par value, 100,000,000 authorized,
9,953,024 issued and outstanding
2,416,696
Deficit accumulated during development stage
(893,750)
Deficit
(1,899,000)
Accumulated other comprehensive loss
(258,930)
-----------
Total deficiency in assets
(634,984)
-----------
Total liabilities and deficiency in assets $ 211,914
===========
See accompanying notes
3
BRAVO RESOURCE PARTNERS, LTD.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
- ---------------------------------------------------------------------------------------------------------------------------------
Cumulative from Three-Month Three-Month Nine-Month Nine-Month
the Beginning of Period ended Period ended Period ended Period ended
Development Stage April 30, April 30, April 30, April 30,
(August 1, 2002) 2006 2006 2006 2005
----------- ----------- ----------- ----------- -----------
EXPENSES
Consulting $ 125,771 $ -- $ 12,500 $ 22,500 $ 20,000
Depreciation
28,841 8,446 -- 22,960 --
License and user fees
22,701 2,072 2,102 7,430 3,222
Management fees
81,518 -- 7,200 -- 21,600
Office and miscellaneous
68,730 16,631 2,560 36,426 5,956
Salaries
176,695 51,209 -- 176,695 --
Professional fees
311,133 2,280 11,042 71,485 39,938
Shareholder communications and investor relations
16,924 -- 697 -- 1,460
Transfer agent and filing fees
33,592 1,429 6,341 6,400 7,286
Travel and promotion
27,171 4,418 3,102 14,037 5,154
----------- ----------- ----------- ----------- -----------
Total expenses
893,076 86,485 45,544 357,933 104,616
----------- ----------- ----------- ----------- -----------
Loss before other items
(893,076) (86,485) (45,544) (357,933) (104,616)
----------- ----------- ----------- ----------- -----------
OTHER ITEMS
Costs recovered
3,881 -- -- -- --
Interest expense
(36,599) (11,879) -- (28,767) (27)
Write-down of receivables portfolios
(48,367) -- -- -- --
Gain on settlement of debt
72,010 -- -- -- 46,440
Foreign currency translation income
64 -- -- -- --
Other income
6,339 571 -- 6,339 --
Debt recovery income
1,998 -- 249 -- 2,063
----------- ----------- ----------- ----------- -----------
Total other items 48,476
(674) (11,308) 249 (22,428)
----------- ----------- ----------- ----------- -----------
Income (loss) before income taxes
(893,750) (97,793) (45,295) (380,361) (56,140)
Provision for income taxes
----------- ----------- ----------- ----------- -----------
Net income (loss) $ (893,750) $ (97,793) $ (45,295) $ (380,361) $ (56,140)
Other comprehensive loss
Foreign currency translation adjustments
(258,930) -- -- -- --
----------- ----------- ----------- ----------- -----------
Comprehensive Loss $(1,152,680) $ (97,793) $ (45,295) $ (380,361) $ (56,140)
=========== =========== =========== =========== ===========
Basic and diluted loss per common share $ (0.01) $ (0.00) $ (0.04) $ (0.01)
=========== =========== =========== ===========
Basic and diluted weighted average number of common
shares outstanding 9,615,235 9,118,682 9,704,609 8,294,731
=========== =========== =========== ===========
See accompanying notes
4
BRAVO RESOURCE PARTNERS, LTD.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
========================================================================================================
Cumulative
from the
Beginning of Nine-Month Nine-Month
Development Period ended Period ended
Stage (August April 30, April 30,
1, 2002) 2006 2005
------------ ------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) from operations $ (893,750) $ (380,361) $ (56,140)
Adjustments to reconcile net loss to net cash used in
operating activities:
Write-down of receivables portfolio
48,367 -- --
Gain on settlement of debt
(72,010) -- (46,440)
Depreciation expense
28,841 22,960 --
Common stock issued for services
56,324 6,324 --
Changes in assets and liabilities
(Increase) in accounts receivables
(3,196) (3,196) --
Decrease (Increase) in other receivables
5,036 (18) 3,761
(Increase) in prepaid expenses
(1,313) (1,350) --
Increase in accounts payable and accrued liabilities
89,606 44,258 22,580
Increase in accrued interest
32,589 28,156 --
Increase (decrease) in due to related parties
283,938 7,500 30,099
------------ ------------ ------------
Net cash used in operating activities
$ (425,568) $ (275,727) (46,140)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of common stock
132,540 15,000 13,500
Stock subscriptions received in advance
30,767 -- 31,000
Proceeds from promissory notes payable-related party
298,421 272,700 --
Repayment of promissory notes payable
(4,811) -- --
Advances from related parties
54,375 15,384 --
Repayments to related parties
(10,000) -- (10,000)
------------ ------------ ------------
Net cash provided by (used in) financing activities
501,292 303,084 34,500
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES
Puchase of software
(149) (149) --
Acquisition of receivables portfolios
(76,171) -- --
Investment in television programs
(20,397) (20,397) --
Collection of receivables portfolios
24,139 -- --
------------ ------------ ------------
Net cash used in investing activities
(72,578) (20,546) --
------------ ------------ ------------
Effect of foreign currency translation
364 -- --
Change in cash and cash equivalents during period
3,510 6,811 (11,640)
Cash and cash equivalents beginning of the period
436 (2,865) 13,119
------------ ------------ ------------
Cash and cash equivalents end of the period $ 3,946 $ 3,946 $ 1,479
============ ============ ============
See accompanying notes.
5
BRAVO RESOURCE PARTNERS LTD.
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2006
(Unaudited)
================================================================================
1. NATURE AND CONTINUANCE OF OPERATIONS
Organization
------------
Bravo Resource Partners Ltd. (the "Company") was incorporated in the
Province of British Columbia on November 14, 1986, and continued into the
Yukon Territory under the Business Corporations Act on January 21, 2000.
Effective August 18, 2003, in accordance with the revised TSX Venture
Exchange ("TSX-V") Policy 2.5, the Company was transferred to the NEX
board. The Company is considered to be in the development stage. Prior to
being transferred to the NEX board, Bravo Resources Partners Ltd. was
engaged in the acquisition, exploration, and development of mineral
properties, and briefly sought a business opportunity in the consumer debt
portfolio industry.
On May 4, 2006, the Company announced that its common stock was approved
for trading on the Over the Counter Bulletin Board (OTCBB) (OTC Bulletin
Board: BRPNF) and Pink Sheets. The Company's common stock trades under the
stock symbol "BRPNF".
Acquisition
-----------
On June 27, 2005, the Company acquired duplicating, editing, and graphics
equipment and software to be used in the creation, editing, and development
of media productions. By this acquisition and the operation of the newly
acquired assets, the Company is entering the film editing and multi-media
productions industry including film, movie, and advertising productions.
On February 25, 2006, the Company entered into an investment agreement with
Shore Drive Productions LLC, a California limited liability company, to
participate in the development, production, and distribution of two
television series entitled "Ride" and "Uncaged."
Unaudited financial statements
------------------------------
The accompanying unaudited consolidated financial statements of Bravo
Resource Partners Ltd. and subsidiaries have been prepared in accordance
with U.S. generally accepted accounting principles for interim information
and with the instructions to Form 10-QSB and Regulation S-B. Accordingly,
they do not include all of the information and footnotes required by
accounting principles generally accepted in the United States for complete
financial statements. In the opinion of management, these consolidated
financial statements include all adjustments of a normal and recurring
nature necessary for a fair presentation. Operating results for the three
months ending April 30, 2006, may not necessarily be indicative of the
results that may be expected for the year ended July 31, 2006.
Going-concern
-------------
The Company's consolidated financial statements are prepared in conformity
with generally accepted accounting principles in the United States of
America applicable to a going concern, which contemplates the realization
of assets and liquidation of liabilities in the normal course of business.
However, as shown in the accompanying consolidated financial statements,
the Company has sustained substantial losses from operations since
inception and has no current source of revenue. In addition, the Company
has used, rather than provided, cash in the Company's operations. Without
realization of additional capital, it would be unlikely that the Company
could continue as a going-concern. It is management's plan in this regard
to obtain additional working capital through borrowing or equity financing
which may not be available.
These consolidated financial statements do not include any adjustments
relating to the recoverability and classification of recorded asset
amounts and classification of liabilities that might be necessary
should the Company be unable to continue operations.
6
BRAVO RESOURCE PARTNERS LTD.
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2006
(Unaudited)
================================================================================
Principles of Consolidation
---------------------------
These consolidated financial statements include the accounts of the Company
and its wholly-owned inactive subsidiaries, Minera Oro Bravo S.A., a
company incorporated in Costa Rica, and Minera Oro Bravo Mexico, S.A. de
C.V., a company incorporated in Mexico. Significant inter-company balances
and transactions were eliminated upon consolidation.
2. SIGNIFICANT ACCOUNTING POLICIES (cont.)
Fair Value of Financial Instruments
-----------------------------------
Cash, receivables, accounts payable, debt, accrued expenses, and other
liabilities are carried at amounts which reasonably approximate their fair
value due to the short-term nature of these amounts or due to variable
rates of interest which are consistent with current market rates.
Cash and Cash Equivalents
-------------------------
Cash and cash equivalents consist of time deposits and all liquid
instruments (including overnight repurchase agreements with a bank) with
maturities of three months or less.
Property and Equipment
----------------------
Property and equipment are stated at cost. Expenditures for major
betterments and additions are charged to the property accounts, while
replacements, maintenance, and repairs that do not improve or extend the
lives of the respective assets are charged to expense currently.
Depreciation is computed principally using the straight-line method, based
on the estimated useful lives of the assets, which range from three to
seven years.
Estimates
---------
The preparation of financial statements in accordance with generally
accepted accounting principles in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amount
of revenues and expenses during the year. Actual results could differ from
those estimates.
Foreign currency translation
----------------------------
For the year ended July 31, 2004, and prior years, the functional currency
of the Company and its wholly-owned subsidiaries was the Canadian dollar.
Accordingly, monetary assets and liabilities denominated in a foreign
currency were translated at the exchange rate in effect at the balance
sheet date while non-monetary assets and liabilities denominated in a
foreign currency were translated at historical rates. Revenue and expense
items denominated in a foreign currency were translated at exchange rates
prevailing when such items were recognized in the statement of operations.
Exchange gain or losses arising on translation of foreign currency items
were included in the statement of operations. With respect to the
presentation of these consolidated financial statements in the reporting
currency, being the United States dollar, the Company follows the current
rate method of translation. Accordingly, assets and liabilities are
translated into United States dollars at the period-end exchange rates
while revenue and expenses are translated at the prevailing exchange rates
during the period. Related exchange gains and losses are included in a
separate component of stockholder's equity as accumulated other
comprehensive income.
Effective August 1, 2004, the Company changed its functional currency from
the Canadian dollar to the United States dollar. Accordingly, monetary
assets and liabilities denominated in a foreign currency are translated at
the exchange rate in effect at the balance sheet date while non-monetary
assets and liabilities denominated in a foreign currency are translated at
historical rates. Revenue and expense items denominated in a foreign
currency are translated at exchange rates prevailing when such items are
recognized in the statement of operations. Exchange gains or losses arising
on translation of foreign currency items are included in the statement of
operations.
7
BRAVO RESOURCE PARTNERS LTD.
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2006
(Unaudited)
================================================================================
2. SIGNIFICANT ACCOUNTING POLICIES (cont.)
Income Taxes
------------
Income taxes are computed under the provisions of the Financial Accounting
Standards Board Statement (SFAS) No. 109, "Accounting for Income Taxes."
SFAS 109 is an asset and liability approach that requires the recognition
of deferred tax assets and liabilities for the expected future tax
consequences of the differences in events that have been recognized in our
financial statements compared to the tax returns. Current and deferred
taxes are allocated to members of the consolidated group by applying FASB
Statement No. 109 to each member as if it were a separate taxpayer.
Accounts Receivable
-------------------
Accounts receivable are amounts due mainly from reimbursements for expenses
paid on behalf of Box Office Productions II, LLC, a California limited
liability company. Receivables are accounted for on a quarterly basis, plus
a fixed 15% rate for consultation and administrative services rendered.
Income Tax Credits
------------------
Income tax credits will be recognized as a reduction of the provision for
income taxes in the year in which they are utilized.
Basic and Diluted Net Loss Per Share
------------------------------------
Basic net loss per common share is computed by dividing the net loss by the
weighted average number of common shares outstanding during each period. We
use the treasury stock method to compute the dilutive effect of options,
warrants, and similar instruments. Under this method the dilutive effect on
loss per share is recognized on the use of the proceeds that could be
obtained upon exercise of options, warrants, and similar instruments. It
assumes that the proceeds would be used to purchase common shares at the
average market price during the period. For the periods presented, this
calculation proved to be anti-dilutive. As of April 30, 2006, there are no
outstanding warrants or options issued or outstanding.
Reclassifications
-----------------
Certain amounts in the prior year financial statements have been
reclassified for comparative purposes to conform to the current year
presentation.
Pronouncements
--------------
In December 2004, FASB issued Statement of Financial Accounting Standards
No. 123R, "Share Based Payment" ("SFAS123R"). SFAS 123R supersedes APB 25
and its related implementation guidance by requiring entities to recognize
the costs of employee services received in exchange for awards of equity
instruments based on the grant-date fair value of those awards (with
limited exceptions) and revises SFAS 123 as follows:
i. Public entities are required to measure liabilities incurred to
employees in share-based payment transactions at fair value and
nonpublic entities may elect to measure their liabilities to employees
incurred in share-based payment transactions at their intrinsic value
whereas under SFAS 123, all share-based payment liabilities were
measured at their intrinsic value.
ii. Non-public entities are required to calculate fair value using an
appropriate industry sector index for the expected volatility of its
share price if it is not practicable to estimate the expected
volatility of the entity's share price.
8
BRAVO RESOURCE PARTNERS LTD.
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2006
(Unaudited)
================================================================================
2. SIGNIFICANT ACCOUNTING POLICIES (cont.)
iii. Entities are required to estimate the number of instruments for which
the requisite service is expected to be rendered as opposed to
accounting for forfeitures as they occur.
iv. Incremental compensation cost for a modification of the terms or
conditions of an award is measured by comparing the fair value of the
modified award with the fair value of the award immediately before the
modification whereas SFAS 123 required that the effects of a
modification be measured as the difference between the fair value of
the modified award at the date it is granted and the award's value
immediately before the modification determined based on the shorter of
(1) its remaining initially estimated expected life or (2) the
expected life of the modified award.
SFAS 123R also clarifies and expands guidance in several areas, including
measuring fair value, classifying an award as equity or as a liability and
attributing compensation cost to reporting periods. SFAS 123R does not
change the accounting guidance for share-based payment transactions with
parties other than employees provided in SFAS 123 as originally issued and
EITF 96-18. SFAS 123R also does not address the accounting for employee
share ownership plans which are subject to Statement of Position 93-6,
"Employers' Accounting for Employee Stock Ownership Plans". Public
entities, like us, that file as small business issuers will be required to
apply SFAS 123R in the first annual reporting period that begins after
December 15, 2005.
The adoption of this new pronouncement is not expected to have a material
effect on our financial position or results of operations.
3. ACCOUNTS RECEIVABLE
On October 1, 2005, the Company agreed with Box Office Productions II, LLC,
(hereinafter referred to as "BOP II") a California limited liability
company, to provide consultation and administrative services. As of April
30, 2006, the Company's accounts receivable from BOP II is $3,196,
inclusive of accrued revenue of $2,345 for the quarter ended April 30,
2006.
4. RELATED PARTY TRANSACTIONS
During the three-month period ended April 30, 2006, the Company entered
into the following related party transactions:
As of April 30, 2006, the principal balance due to Alpine Pictures, Inc.,
(a company with a former director in common) from a variable principal
promissory note issued by the Company to Alpine on August 1, 2005, is
$288,625 plus accrued interest of $15,457. The note bears annual interest
at 10% and is due 180 days from written demand by the payee. Alpine
Pictures, Inc., also holds a promissory note for the purchase of equipment
by the Company during the prior fiscal year. The note bears interest at 8%.
As of April 30, 2006, the principal balance due to Alpine Pictures, Inc.,
on that note is $211,717, plus accrued interest of $14,110.
The Company has a total due to related parties of $715,172. This amount
consists of $214,830 due to related parties, $288,625 loan from Alpine
Pictures, Inc., and $211,717 note payable to Alpine Pictures, Inc.
9
BRAVO RESOURCE PARTNERS LTD.
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2006
(Unaudited)
================================================================================
4. RELATED PARTY TRANSACTIONS (cont.)
The Company accrued consulting expenses with Asset Solutions (Hong Kong)
Ltd. A director of the Company has represented Asset Solutions (Hong Kong)
Ltd. Total amount accrued for the period ending April 30, 2006, is $7,500.
5. CAPITAL STOCK
On February 2, 2006, the Company announced that it had arranged a private
placement with Meier Ludwig LLC, a Colorado limited liability company.
Under the terms of the private placement, the Company issued 345,554 Common
shares in the capital of the Company at $0.05US per share for gross
proceeds of $15,000.00US. The Common shares issued are subject to a hold
period, which will expire one year after the date of the distribution of
the Common shares.
As a result of the proposed transactions described above, Meier Ludwig LLC
beneficially owns 582,200 Common shares in the capital of the Company
representing approximately 5.7% of the then issued and outstanding share
capital of the Company.
On March 3, 2006, the Company announced that it agreed to issue 1,250,000
shares at $0.08 Canadian in satisfaction of debt in the amount of $88,350
USD owed to an insider, Ernest Staggs, a director and chief financial
officer of the Company. The shares were issued on or about May 25, 2006.
On May 10, 2006, the Company issued 106,958 shares at $0.0825 to Asset
Solutions (Hong Kong) Ltd., in satisfaction for $7,500 debt accrued
pursuant to consulting agreement.
On May 18, 2006, the Company issued 500,000 shares at $0.11 to The Bridge
Group Inc., in consideration of certain services provided to the Company
pursuant to an agreement dated December 22, 2004.
6. SUPPLEMENTAL DISCLOSURES WITH RESPECT TO CASH FLOWS
2005 2004
------- -------
Interest received $ -0- $ -0-
Cash paid during the period for income taxes -0- -0-
Cash paid during the period for interest -0- -0-
======= =======
The following non-cash transactions occurred during the quarter ended April
30, 2006:
On March 3, 2006, the Company announced that it agreed to issue 1,250,000
shares at $0.08 Canadian in satisfaction of debt in the amount of $88,350
USD owed to an insider, Ernest Staggs, a director and chief financial
officer of the Company. The shares were issued on or about May 25, 2006.
7. SEGMENTED INFORMATION
All of our identifiable assets are located in the United States.
10
BRAVO RESOURCE PARTNERS LTD.
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 2006
(Unaudited)
================================================================================
8. SUBSEQUENT EVENTS
The Company is a defendant in an interpleader action filed by Everest
Exploration, Inc., on or about April 28, 2006. The interpleader action
relates to ownership of shares of Everest Exploration, Inc., common stock,
which the Company asserts it acquired while the Company pursued
reactivation in the debt recovery and collections business. It is too early
to determine the outcome of the litigation.
On May 4, 2006 the Company announced that its common stock was approved for
trading on the Over the Counter Bulletin Board (OTCBB) and Pink Sheets. The
Company's common stock will trade under the stock symbol "BRPNF".
On May 5, 2006, the Company announced that Mr. Mark Savoy resigned as a
director of the company. Mr. Savoy had been a director of the Company since
November 2004.
On or about May 10, 2006, the Company issued 106,958 stares of common stock
to Asset Solutions (Hong Kong) Ltd. in satisfaction for $7,500 debt accrued
pursuant to consulting agreement.
On or about May 18, 2006, the Company issued 500,000 shares of common stock
to The Bridge Group, Inc. in consideration of certain services provided to
the Company pursuant to an agreement dated December 22, 2004.
On or about May 25, 2006, the Company issued 1,250,000 shares of common
stock to Ernest E. Staggs, a director and Chief Financial Officer, in
satisfaction of a debt in the amount of $88,350
11
NOTE REGARDING PROJECTIONS AND FORWARD LOOKING STATEMENTS
Except for historical information contained herein, this Form 10-QSB contains
express or implied forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Exchange Act. We may make
written or oral forward-looking statements from time to time in filings with the
Securities and Exchange Commission ("SEC"), in press releases, quarterly
conference calls or otherwise. The words "believes," "expects," "anticipates,"
"intends," "forecasts," "project," "plans," "estimates" and similar expressions
identify forward-looking statements. These statements reflect our current views
with respect to future events and financial performance or operations and speak
only as of the date the statements are made.
Forward-looking statements involve risks and uncertainties and readers are
cautioned not to place undue reliance on forward-looking statements. Our actual
results may differ materially from such statements. Factors that cause or
contribute to such differences include, but are not limited to, those discussed
elsewhere in this Form 10-QSB.
Although we believe that the assumptions underlying the forward-looking
statements are reasonable, any of the assumptions could prove inaccurate with
the result that there can be no assurance the results contemplated in such
forward-looking statements will be realized. The inclusion of such
forward-looking information should not be regarded, as a representation that the
future events, plans, or expectations contemplated will be achieved. We
undertake no obligation to publicly update, review, or revise any
forward-looking statements to reflect any change in our expectations or any
change in events, conditions, or circumstances on which any such statements are
based. Our filings with the SEC may be accessed at the SEC's website,
www.sec.gov.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
We were incorporated under the laws of the Province of British Columbia on
November 14, 1986, under the name Bravo Resources, Inc. On May 6, 1994, Bravo
Resources, Inc., changed its business name to Oro Bravo Resources Ltd. After
almost six (6) years of operation, we decided to move our corporate domicile to
the Yukon Territory, Canada, and subsequently to change the business name to
Bravo Resource Partners Ltd.
Between November 1986 and July 2002, we were engaged in the acquisition,
exploration, and development of mineral properties. During this period, our
principal mineral properties were the Mamu/Bravo claim group in the Watson Lake
Mining District, Yukon Territory, the Rio Nuevo Placer Concession located in
Costa Rica, and the Oaxaca Concessions located in Mexico. In July 2002, we
decided to discontinue the mining operations in those locations.
We have two wholly-owned subsidiaries, Minera Oro Bravo S.A., a Company
incorporated in Costa Rica, and Minera Oro Bravo Mexico S.A. de C.V., a Company
incorporated in Mexico. Both of these subsidiaries have been inactive since we
discontinued mining operations in July 2002.
In July 2003, we moved our offices from Vancouver, BC, to Denver, Colorado.
We do not have a website.
On November 1, 2005, we agreed with Box Office Productions II, LLC ("BOP II"), a
California limited liability company, to provide consultation and administrative
services.
On March 2, 2006, we announced that we had entered into an investment agreement
with Shore Drive Productions LLC, a California limited liability company, to
participate in the development, production, and distribution of two television
series entitled "Ride" and "Uncaged."
On February 25, 2006, the Company entered into an agreement to invest $11,075USD
in the development of a television series entitled "Uncaged" and $9,300USD in
the development of a television series entitled "Ride." Upon distribution of
each series, the Company will receive the return of its investment plus thirty
percent (30%) from the first sales of the product; in addition, the Company will
receive three percent (3%) of gross sales of the series. This agreement is with
Shore Drive Productions LLC, a California limited liability company.
During the nine months ended April 30, 2006, our net cash used by operating
activities was $281,124. We satisfied our cash requirements during this period
by borrowing money.
12
Following is our plan of operations for the next twelve months:
1. We do not have any available credit, bank financing, or other external
sources of liquidity. Due to historical operating losses, operations
have not been a source of liquidity. In order to obtain capital and to
satisfy our cash needs for the next twelve months, we may need to sell
additional shares of common stock or to borrow funds from private
lenders. There can be no assurance that we will be successful in
obtaining additional funding to meet our cash needs for the next
twelve months.
2. No extensive product research and development is expected to be
performed over the term of the plan.
3. For this fiscal year ending July 2006, we are not anticipating any
purchase or sale of plant or significant equipment.
4. We do not expect to have any significant changes in the number of
employees for this year. At present, we have only three employees: Our
President, Tyrone R. Carter, who spends 100% of his time on the
Company's business; our Chief Financial Officer, Ernest Staggs, who
spends approximately 50% of his time on the Company's business; and
Tabea M. Carter, who provides administrative and translation services.
Ms. T. Carter spends approximately 90% of her time on the Company's
business.
ITEM 3. CONTROLS AND PROCEDURES
Tyrone R. Carter, our Chief Executive Officer, and Ernest Staggs, our Principal
Financial Officer, have evaluated the effectiveness of our disclosure controls
and procedures as of a date within ninety days prior to the filing date of this
report and in their opinion our disclosure controls and procedures insure that
material information relating to the Company is made known to them by others
within the Company, particularly during the period in which this report is being
prepared, so as to allow timely decisions regarding required disclosure.
There have been no significant changes in our internal controls or in other
factors that could significantly affect these controls subsequent to the date of
evaluation, and as a result, no corrective actions with regard to significant
deficiencies or material weaknesses in our internal controls were required.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
-----------------
The Company is a defendant in an interpleader action filed by Everest
Exploration, Inc., on or about April 28, 2006 in 148th Judicial
District Court, Nueces County, Texas. The Plaintiff is Everest
Exploration, Inc. and the defendants are Asset Solutions (Hong Kong)
Limited, Raccoon Recovery, LLC and Bravo Resource Partners, Ltd. The
interpleader action relates to ownership of 61,114 shares of Everest
Exploration, Inc., common stock which the Company asserts it acquired
while the company pursued reactivation in the debt recovery and
collections business. The Company is seeking a court order determining
that it owns the shares of Everest Exploration, Inc. The Company is
uncertain the date when the court may decide the case. It is too early
to determine the outcome of the litigation.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
-----------------------------------------------------------
On February 28, 2006, the Company announced that it had arranged a
private placement with Meier Ludwig LLC, a Colorado limited liability
company. Under the terms of the private placement, the Company agreed
to issue 345,554 Common shares in the capital of the Company at
$0.05US per share for gross proceeds of $15,000.00US. The Common
shares issued shall be subject to a hold period which will expire one
year after the date of the distribution of the Common shares
On March 3, 2006, the Company announced that it agreed to issue
1,250,000 shares at $0.08 Canadian in satisfaction of debt in the
amount of $88,350 USD owed to an insider, Ernest Staggs, a director
and chief financial officer of the Company. The shares were issued on
or about May 25, 2006
13
On May 10, 2006, the Company issued 106,958 shares at $0.0825 to Asset
Solutions (Hong Kong) Ltd., in satisfaction for $7,500 debt accrued
pursuant to consulting agreement.
On May 18, 2006, the Company issued 500,000 shares at $0.11 to The
Bridge Group Inc., in consideration of services provided to the
Company related to the Company's trading in the United States pursuant
to an agreement dated December 22, 2004.
Item 3. Defaults Upon Senior Securities
-------------------------------
None.
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
The Company held its Annual General Shareholder meeting on April 27,
2006. The following items were submitted to a vote of the
shareholders:
o Presentation of the Report of the Board of Directors of the
Company for the financial year ended July 31, 2005; o
Presentation of the Company's financial statements for the year
ended July 31, 2005, and the report of the Company's auditor on
those statements;
o Election of five members to the Company's Board of Directors to
serve until the 2007 Annual Meeting or until their successors are
duly elected and qualified; including Ty Carter, Ernest Staggs,
Melissa Walker, Mark Savoy and Michael Meier;
o Ratification of the re-appointment of Dohan and Co. CPA as the
Company's independent registered public accounting firm;
Each of the foregoing items was approved by the vote of the
shareholders.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
During the three months ended April 30, 2006, we filed the following
reports on Form 8K:
a.) The following exhibits are filed with this report:
Number Description
------ -----------
31.1 Rule 13a-14(a)15d-14(a) certification
31.2 Rule 13a-14(a)15d-14(a) certification
32 Section 1350 certifications
b.) Reports on 8-K:
1.) We filed a Current Report on Form 8-K on February 28, 2006,
regarding the announcement of an arrangement of a private
placement with Meir Ludwig LLC, a Colorado limited liability
company.
2.) We filed a Current Report on Form 8-K on March 2, 2006
regarding the entering into an investment agreement with
Shore Drive Productions, LLC, a California limited liability
company, to participate in the development, production, and
distribution of two television series entitled "Ride" and
"Uncaged."
3.) We filed a Current Report on Form 8-K on March 3, 2006
regarding entering into an agreement to settle debt owed to
an insider, Ernest Staggs, a director and chief financial
officer of the Company.
14
4.) We filed a Current Report on Form 8-K on May 5, 2006
regarding the immediate resignation of Mr. Mark Savoy as
director of The Company.
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.
BRAVO RESOURCE PARTNERS LTD.
(Registrant)
Date: June 14, 2006 By: /s/ Tyrone R. Carter
----------------- ---------------------------------------
Tyrone R. Carter, President and Chief
Executive Officer
Date: June 14, 2006 By: /s/ Ernest Staggs
------------------ --------------------------------------
Ernest Staggs, Principal
Financial and Accounting Officer
15