UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURUTIES EXCHANGE ACT OF 1934
For the fiscal year ended April 30, 2008
Commission File Number 333-144279
CANUSA CAPITAL CORP.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
68220 Espada Road
Cathedral City, CA 92234
.(Address of principal executive offices, including zip code.)
(760)325-4497
(telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to section 12(g) of the Act:
Common Stock, $.001 par value
Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]
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 if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer [ ] Accelerated Filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a Smaller reporting company)
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 April 30, 2008, the registrant had 2,500,000 shares of common stock issued
and outstanding. No market value has been computed based upon the fact that no
active trading market had been established as of April 30, 2008.
CANUSA CAPITAL CORP.
TABLE OF CONTENTS
Page No.
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Part I
Item 1. Business 3
Item 1A. Risk Factors 13
Item 2. Properties 17
Item 3. Legal Proceedings 17
Item 4. Submission of Matters to a Vote of Securities Holders 18
Part II
Item 5. Market for Registrant's Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities 18
Item 7. Management's Discussion and Analysis of Financial Condition
and Plan of Operation 19
Item 8. Financial Statements 22
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 32
Item 9A. Controls and Procedures 32
Part III
Item 10. Directors and Executive Officers 32
Item 11. Executive Compensation 34
Item 12. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters 35
Item 13. Certain Relationships and Related Transactions 36
Item 14. Principal Accounting Fees and Services 36
Part IV
Item 15. Exhibits 37
Signatures 37
2
PART I
FORWARD LOOKING STATEMENTS
Some of the statements contained in this Form 10-K that are not historical facts
are "forward-looking statements" which can be identified by the use of
terminology such as "estimates," "projects," "plans," "believes," "expects,"
"anticipates," "intends," or the negative or other variations, or by discussions
of strategy that involve risks and uncertainties. We urge you to be cautious of
the forward-looking statements, that such statements, which are contained in
this Form 10-K, reflect our current beliefs with respect to future events and
involve known and unknown risks, uncertainties and other factors affecting our
operations, market growth, services, products and licenses. No assurances can be
given regarding the achievement of future results, as actual results may differ
materially as a result of the risks we face, and actual events may differ from
the assumptions underlying the statements that have been made regarding
anticipated events.
All written forward-looking statements, made in connection with this Form 10-K
that are attributable to us or persons acting on our behalf, are expressly
qualified in their entirety by these cautionary statements. Given the
uncertainties that surround such statements, you are cautioned not to place
undue reliance on such forward-looking statements.
The safe harbors of forward-looking statements provided by the Securities
Litigation Reform Act of 1995 are unavailable to issuers not subject to the
reporting requirements set forth under Section 13(a) or 15(D) of the Securities
Exchange Act of 1934, as amended. As we have not registered our securities
pursuant to Section 12 of the Exchange Act, such safe harbors set forth under
the Reform Act are unavailable to us.
ITEM 1. BUSINESS
GENERAL INFORMATION
We are an exploration stage company engaged in the acquisition and exploration
of mineral properties. We currently own a 100% undivided interest in a mineral
property located in Esmeralda County, State of Nevada that we call the "Dap
Property." We are currently conducting mineral exploration activities on the Dap
Property in order to assess whether it contains any commercially exploitable
mineral reserves. Currently there are no known mineral reserves on the Dap
Property.
There is the likelihood of our mineral claim containing little or no economic
mineralization or reserves of silver and other minerals. We are presently in the
exploration stage of our business and we can provide no assurance that any
commercially viable mineral deposits exist on our mineral claims, that we will
discover commercially exploitable levels of mineral resources on our property,
or, if such deposits are discovered, that we will enter into further substantial
exploration programs. Further exploration is required before a final
determination can be made as to whether our mineral claims possess commercially
exploitable mineral deposits. If our claim does not contain any reserves all
funds that we spend on exploration will be lost.
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We currently utilize space provided to us on a rent free basis from our officer
and director, Janet Janes at 68220 Espada Road, Cathedral City, CA 92234.
Management believes the current premises are sufficient for its needs at this
time. Our fiscal year end is April 30th.
As of April 30, 2008 we had generated no revenues. We have been issued an
opinion by our auditor that raises substantial doubt about our ability to
continue as a going concern based on our current financial position.
We have a total of 100,000,000 authorized common shares with a par value of
$0.001 per share with 2,500,000 common shares issued and outstanding as of April
30, 2008. We completed a Form SB-2 Registration Statement under the Securities
Act of 1933 with the U.S. Securities and Exchange Commission registering
1,000,000 shares of our common stock at the selling price of $0.025 per share.
The offering was completed with total proceeds to the company of $25,000.
GLOSSARY OF TECHNICAL GEOLOGICAL TERMS
The following defined technical terms are used in this annual report:
Aeromagnetic survey A magnetic survey conducted from the air
normally using a helicopter or fixed-wing
aircraft to carry the detection instrument and
the recorder.
Alluvial Consolidated sediments that are carried and
hence deposited by a stream or river. In the
southwest USA most in filled valleys often
between mountain ranges were deposited with
alluvium.
Andesitic to basaltic
composition A range of rock description using the chemical
make-up or mineral norms of the same.
Aphanitic Fine grained crystalline texture.
Blind-Basin A basin practically closed off by enveloping
rock exposures making the central portion of
unconsolidated alluvial basin isolated.
Colluvium Loose, unconsolidated material usually derived
by gravitational means, such as falling from a
cliff or scarp-face and often due to a sort of
benign erosion such as heating and cooling in a
desert environment.
Desert Wash Out-wash in dry (desert) or arid areas of
colluvium or alluvial material accumulated on
the sides of valleys or basin channels by often
irregular and violent water flow, i.e. flash
floods.
Elongate Basin A longer than wide depression that could be
favorable to in-filling by material from
adjacent eroding mountains.
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Formation The fundamental unit of similar rock assemblages
used in stratigraphy.
Intermontane belt Between mountains (ranges), a usually longer
than wide depression occurring between enclosing
mountain ranges that supply the erosional
material to infill the basin.
Lode mineral claim (Nevada) With a maximum area contained within 1500' long
by 600' wide = 20.66 acres.
Nuees Ardante or Ladu An extremely hot, gaseous, somewhat horizontally
ejected lava, often from near the summit that
accentuates the downward flow or "glowing
avalanche" because of its mobility.
Overburden or Drift Cover Any loose material which overlies bedrock.
Plagioclase feldspar A specific range of chemical composition of
common or abundant rock forming silicate
minerals.
Playa The lowest part of an intermontane basin which
is frequently flooded by run-off from the
adjacent highlands or by local rainfall.
Plutonic, igneous or
intrusive rock Usually a medium to coarser grain sized
crystalline rock that generally is derived from
a sub-surface magma and then consolidated, such
as in dykes, plugs, stocks or batholiths, form
smallest to largest.
Porphyritic in augite Large prophyroblasts or crystals of a specific
pyroxene rock-forming mineral, i.e. augite occurring
within a matrix of finer grained rock-forming
minerals.
Quarternary The youngest period of the Cenozoic era.
Snow equivalent Approximately 1" of precipitation (rain) = 1'
snow.
Syenite Coarse grained, alkalic, low in quartz intrusive
rock.
Trachyte Fine grained or glassy equivalent of a syenite.
Volcaniclastic Angular to rounded particles of a wide range of
size within (a welded) finer grain-sized matrix
of volcanic origin.
ACQUISITION OF THE DAP PROPERTY
In February, 2007, we purchased a 100% undivided interest in a mineral claim
known as the Dap 1-4 Mineral Claims for a price of $7,000. The claims are staked
and recorded in the name of Canusa Capital Corp. and are in good standing until
September 1, 2008.
5
[MAP SHOWING THE PROPERTY LOCATION]
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We engaged James McLeod, P.Geo. to prepare a geological evaluation report on the
Dap Property. Mr. Mcleod is a consulting professional engineer in the Geological
Section of the Association of Professional Engineers and Geoscientists of
British Columbia and a Fellow of the Geological Association of Canada. Mr.
McLeod attended the University of British Columbia and holds a Bachelor of
Science degree in geology.
The work completed by Mr. McLeod in preparing the geological report consisted of
a review of geological data from previous exploration within the region. The
acquisition of this data involved the research and investigation of historical
files to locate and retrieve data information acquired by previous exploration
companies in the area of the mineral claims.
We received the geological evaluation report on the Dap Property entitled
"Review and Recommendations Dap 1-4 Mineral Claims North Paymaster Canyon,
Esmeralda County, Nevada, USA" prepared by Mr. McLeod on February 22, 2007. The
geological report summarizes the results of the history of the exploration of
the mineral claims, the regional and local geology of the mineral claims and the
mineralization and the geological formations identified as a result of the prior
exploration. The geological report also gives conclusions regarding potential
mineralization of the mineral claims and recommends a further geological
exploration program on the mineral claims. The description of the Dap Property
provided below is based on Mr. McLeod's report.
DESCRIPTION OF PROPERTY
The property owned by Canusa Capital, on which the net proceeds of our recent
offering will be spent, is the Dap 1-4 Mineral Claims which is comprised of four
contiguous claims totaling 82.64 acres, located in Esmeralda County, Nevada,
USA.
The Dap Property lies in the west central area of the State of Nevada southwest
of the town of Tonopah and is accessible from Highway 95 by traveling south of
the Town for 11 miles to the Paymaster Canyon cut-off and then traveling
southwest for 6 miles to the property.
The claims were recorded with the County and the Bureau of Land Management. In
August, 2008, we will be required to make a filing that discloses our intent to
do field work and record it as assessment work with the BLM.
Dap Property, recorded with the Bureau of Land Management as follows:
Name of Mineral Claim Transaction Number Annual Filing Due
--------------------- ------------------ -----------------
Dap 1-4 1493131 September 1, 2008
7
[MAP SHOWING THE CLAIM LOCATION]
8
CLIMATE AND GENERAL PHYSIOGRAPHY
The area experiences about 4" to 8" of precipitation annually of which about 20%
may occur as a snow equivalent. This amount of annual precipitation reflects a
climatic classification of arid to semi-arid. The summers can experience hot
weather; middle 60's to 70's F (degrees) average with high spells of 100+F
(degrees) while the winters are generally more severe than the dry belt to the
west and can last from December through February. Temperatures experienced
during mid-winter average for January of from the high 20's to the low 40's F
(degrees) with low spells down to -20F (degrees).
The claim area ranges in elevation from 5,580' to 5,830' mean sea level. The
physiographic setting of the property can be described as open desert in the
valleys within a mosaic of rugged mountain ranges in an interior plateau
setting. The area has been altered on the surface both by fluvial and wind
erosion and the depositional (drift cover) effects of in-filling. Thickness of
drift cover in the valleys may vary considerable. Surface water occurrences are
rare, springs are sparse and subsurface aquifers are accessed by drilling wells
where allowed.
The physiography of the Dap mineral claim area is low rounded to high rugged
mountainous ranges that in the immediate area are arcuate in topographic shape
with intervening broader valleys. Much of this area with many broad open valleys
and spiny mountain ridges hosts sagebrush and other desert plants on the low
hill slopes. Joshua trees and cacti, such as the prickly pear grow as far north
as Goldfield. Juniper and pinion growing above 6,500' with pinion becoming more
dominant at higher elevations. At elevations in the range of 7,500' along water
courses can be found small groves of trembling aspen.
INFRASTRUCTURE
The town of Tonopah offers much of the necessary infrastructure required to base
and carry-out an exploration program (accommodations, communications, equipment
and supplies). Larger or specialized equipment can likely be acquired in the
City of Las Vegas lying 209 miles by paved road (Highway 95) to the south.
Infrastructure such as highways and secondary roads, communications,
accommodations and supplies that are essential to carrying-out an exploration
and development program are at hand, between Tonopah, Goldfield and Las Vegas.
There is not a plant or any equipment currently located on the property. The
initial exploration phases will be supported by generators. Water required for
exploration and development of the claim is available.
PROPERTY HISTORY
To our knowledge, there has been no previous exploration or mining operations on
the Dap Property.
The recorded mining history of the general area dates from the 1860's when
prospectors passed through heading north and west. The many significant lode
gold, silver and other mineral product deposits developed in the area was that
of the Goldfield Camp, 1905; Coaldale Coal Field, 1913; Divide Silver Mining
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District, 1921 and the Candalaria silver-gold mine which operated as an
underground lode gold deposit in 1922 and again in the 1990's as an open cut,
cyanide heap leach operation.
REGIONAL GEOLOGY
The regional geology of Nevada is depicted as being underlain by all types of
rock units. These appear to range from oldest to youngest in an east to west
direction, respectively. The oldest units are found to occur in the southeast
corner of the state along the Colorado River. The bedrock units exhibit a
north-south fabric of alternating west-west ranges and valleys. This feature may
suggest E-W compression that may have expression as low angle thrust faults on
the west and east walls of Paymaster Canyon (see Figure 3a). Faulting plays a
large part in many areas of Nevada and an even larger part in the emplacement of
mineral occurrences and ore bodies.
LOCAL GEOLOGY
The local geology about the Paymaster Canyon, which lies approximately 15 air
miles to the southwest of Tonopah, NV, reveals a North-South trending, elongate
or elliptical blind-basin bounded, i.e. closed off around much of its perimeter
by rock exposures.
Throughout this outcropping ring-shaped feature are abundant, scattered rock
exposures of Lower - Middle Paleozoic carbonate and aphanitic to very fine grain
sized sediments, as quartzite, siltstone, claystone and more abundant limestone.
Some traditional metamorphic rocks are interlayered.
Jurassic and more abundant Tertiary age intrusive rocks dominate the northern
end of the canyon ring while older Lower Paleozoic sedimentary and lesser
metamorphic equivalents are more abundant in the southern part of the Paymaster
basin.
PROPERTY GEOLOGY AND MINERALIZATION
The geology of the Dap Property area may be described as being covered by
Quaternary desert wash, collovium, alluvium and playa deposits and some Lower
Paleozoic limestone. This young covered basin within a larger surrounding area
of rock exposure and known mineral occurrences exhibiting a good geological
setting and an excellent target area in which to conduce mineral exploration.
Thrust faulting is abundant within the periphery rock exposures at the north-end
of the Paymaster Canyon with younger Ordovician limestone and shale units lying
on the older Lower Cambrian sedimentary rock units. The oldest meta-sedimentary
units can be overlain by granitic rocks of Jurassic age or Tertiary age volcanic
rock on andesite to rhyolite composition.
The outcrops partially surrounding or flanking the alluvial covered valley
underlying the mineral claim area suggests mineral occurrences or structurally
prepared bedrock could be sought after in those areas.
By far the largest production in the County comes from the vein-type of gold and
silver occurrences in quartz fissures in either pre-Tertiary volcanic or
Tertiary volcanic host rocks.
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CONCLUSIONS OF GEOLOGICAL REPORT
The geological evaluation report we obtained on the Dap Property states the
property is favorably located for the possible discovery of a large, probably
low grade mineral deposit of base and/or precious metals or other mineral of
soft economic consideration that have open pit and/or underground mining
potential. If such a deposit exists, it may occur under the drift or overburden
covered areas of the Dap 1-4 mineral claims.
RECOMMENDATIONS OF GEOLOGICAL REPORT AND THE GEOLOGICAL EXPLORATION PROGRAM
In his geological report, Mr. McLeod, recommended that a three phase continuing
exploration program be undertaken on the property. The three phase program
consists of the following:
Phase Exploration Program Cost Status
----- ------------------- ---- ------
Phase 1 Detailed Prospecting, mapping $10,000 Currently being undertaken.
and soil geochemistry.
Phase 2 Magnetometer and VLF electromagnetic, $10,000 Expected to be completed in Fall, 2008
grid controlled surveys over the areas (depending on the results of Phase 1,
of interest determined by the Phase 1 and consulting geologist's schedule).
survey. Included in this estimated cost
is transportation, accommodation, board,
grid installation, two geophysical
surveys, maps and report
Phase 3 Induced polarization survey over grid $30,000 Expected to be completed in 2009
controlled anomalous area of interest (depending on the results of Phase 2,
outlined by Phase 1 and 2 fieldwork. Hoe and consulting geologist's schedule.)
or bulldozer trenching, mapping and
sampling of bedrock anomalies. Includes
assays, detailed maps and reports.
TOTAL ESTIMATED COST $50,000
COMPETITION
We are an exploration stage company. We do not compete directly with anyone for
the exploration or removal of minerals from our property as we hold all interest
and rights to the claim. Readily available commodities markets exist in the U.S.
and around the world for the sale of gold, silver and other minerals. Therefore,
we will likely be able to sell any gold, silver or other minerals that we are
able to recover.
We will be subject to competition and unforeseen limited sources of supplies in
the industry in the event spot shortages arise for supplies such as dynamite,
and certain equipment such as bulldozers and excavators that we will need to
11
conduct exploration. If we are unsuccessful in securing the products, equipment
and services we need we may have to suspend our exploration plans until we are
able to do so.
We compete with other mineral resource exploration and development companies for
financing and for the acquisition of new mineral properties. Many of the mineral
resource exploration and development companies with whom we compete have greater
financial and technical resources than us. Accordingly, these competitors may be
able to spend greater amounts on acquisitions of mineral properties of merit, on
exploration of their mineral properties and on development of their mineral
properties. In addition, they may be able to afford greater geological expertise
in the targeting and exploration of mineral properties. This competition could
result in competitors having mineral properties of greater quality and interest
to prospective investors who may finance additional exploration and development.
This competition could adversely impact on our ability to finance further
exploration and to achieve the financing necessary for us to develop our mineral
properties.
EMPLOYEES AND EMPLOYMENT AGREEMENTS
We have no employees other than our officer and directors. Ms. Janes, an officer
and director, and Mr. Tsiodras, a director, currently devote approximately 5 - 6
hours per week to company matters. In the future they plan to devote as much
time as the board of directors determines is necessary to manage the affairs of
the company. There are no formal employment agreements between the company and
our current employees. We conduct our business largely through consultants.
RESEARCH AND DEVELOPMENT EXPENDITURES
We have not incurred any research expenditures since our incorporation.
BANKRUPTCY OR SIMILAR PROCEEDINGS
There has been no bankruptcy, receivership or similar proceeding.
REORGANIZATIONS, PURCHASE OR SALE OF ASSETS
There have been no material reclassifications, mergers, consolidations, or
purchase or sale of a significant amount of assets not in the ordinary course of
business.
COMPLIANCE WITH GOVERNMENT REGULATION
We are required to comply with all regulations, rules and directives of
governmental authorities and agencies applicable to the exploration of minerals
in the United States generally, and in the state of Nevada specifically. We are
also subject to the regulations of the Bureau of Land Management, Department of
the Interior.
PATENTS AND TRADEMARKS
We do not own, either legally or beneficially, any patents or trademarks.
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NEED FOR GOVERNMENT APPROVAL FOR ITS PRODUCTS OR SERVICES
We are not required to apply for or have any government approval for our product
or services.
REPORTS TO SECURITIES HOLDERS
We provide an annual report that includes audited financial information to our
shareholders. We will make our financial information equally available to any
interested parties or investors through compliance with the disclosure rules for
a small business issuer under the Securities Exchange Act of 1934. We are
subject to disclosure filing requirements, including filing Form 10-K annually
and Form 10-Q quarterly. In addition, we will file Form 8-K and other proxy and
information statements from time to time as required. We do not intend to
voluntarily file the above reports in the event that our obligation to file such
reports is suspended under the Exchange Act. The public may read and copy any
materials that we file with the Securities and Exchange Commission, ("SEC"), at
the SEC's Public Reference Room at 100 F Street NE, Washington, DC 20549. The
public may obtain information on the operation of the Public Reference Room by
calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site
(http://www.sec.gov) that contains reports, proxy and information statements,
and other information regarding issuers that file electronically with the SEC.
ITEM 1A. RISK FACTORS
WE ARE AN EXPLORATION STAGE COMPANY, HAVE RECENTLY AUTHORIZED THE COMMENCEMENT
OF EXPLORATION ACTIVITIES ON OUR CLAIMS BUT HAVE NOT YET RECEIVED ANY RESULTS
FROM THE GEOLOGIST. WE EXPECT TO INCUR OPERATING LOSSES FOR THE FORESEEABLE
FUTURE.
We have authorized the geologist to begin phase one of the exploration program
on the Dap 1-4 Mineral Claims but have not yet received any results.
Accordingly, we have no way to evaluate the likelihood that our business will be
successful. We were incorporated on December 27, 2006 and to date have been
involved primarily in organizational activities and the acquisition of the
mineral claims. We have not earned any revenues. Investors should be aware of
the difficulties normally encountered by new mineral exploration companies and
the high rate of failure of such enterprises. 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. Prior to completion of our
exploration stage, we anticipate that we will incur increased operating expenses
without realizing any revenues. We expect to incur significant losses into the
foreseeable future. We recognize that if production of minerals from the claims,
we will not be able to earn profits or continue operations. There is no history
upon which to base any assumption as to the likelihood that we will prove
successful, and it is doubtful that we will generate any operating revenues or
ever achieve profitable operations. If we are unsuccessful in addressing these
risks, our business will most likely fail.
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WE HAVE YET TO EARN REVENUE AND OUR ABILITY TO SUSTAIN OUR OPERATIONS IS
DEPENDENT ON OUR ABILITY TO GENERATE REVENUE OR RAISE FINANCING IF REQUIRED. AS
A RESULT, OUR ACCOUNTANT BELIEVES THERE IS SUBSTANTIAL DOUBT ABOUT OUR ABILITY
TO CONTINUE AS A GOING CONCERN.
We have accrued net losses of $24,875 for the period from our inception on
December 27, 2006 to April 30, 2008, and have no revenues to date. Our future is
dependent upon future profitable operations from the development of our mineral
claims or our ability to obtain financing. These factors raise substantial doubt
that we will be able to continue as a going concern. George Stewart, our
independent auditor, has expressed substantial doubt about our ability to
continue as a going concern. If we are not able to complete our business plan we
may have to liquidate our business and investors may lose their investment.
BECAUSE OF THE UNIQUE DIFFICULTIES AND UNCERTAINTIES INHERENT IN MINERAL
EXPLORATION VENTURES, WE FACE A HIGH RISK OF BUSINESS FAILURE.
You should be aware of the difficulties normally encountered by new mineral
exploration companies and the high rate of failure of such enterprises. 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 Dap Property does not contain a known body of any commercial
minerals and, therefore, any program conducted on the Dap Property would be an
exploratory search of any minerals There is no certainty that any expenditures
made in the exploration of the Dap Property will result in discoveries of any
commercial quantities of minerals. Most exploration projects do not result in
the discovery of commercially mineable mineral deposits. Problems such as
unusual or unexpected formations and other conditions are common to mineral
exploration activities and often result in unsuccessful exploration efforts. If
the results of our exploration program do not reveal viable commercial
mineralization, we may decide to abandon our claim and acquire new claims for
new exploration. Our ability to acquire additional claims will be dependent upon
our possessing adequate capital resources when needed. If no funding is
available, we may be forced to abandon our operations.
WE HAVE NO KNOWN MINERAL RESERVES AND IF WE CANNOT FIND ANY, WE MAY HAVE TO
CEASE OPERATIONS.
We have no known mineral reserves. If we do not find any commercially
exploitable mineral reserves or if we cannot complete the exploration of any
mineral reserves, either because we do not have the money to do so or because it
is not economically feasible to do so, we may have to cease operations and you
may lose your investment. Mineral exploration is highly speculative. It involves
many risks and is often non-productive. Even if we are able to find mineral
reserves on our property our production capability will be subject to further
risks including:
- The costs of bringing the property into production including
exploration work, preparation of production feasibility studies, and
construction of production facilities, all of which we have not
budgeted for;
- The availability and costs of financing;
- The ongoing costs of production; and
- Risks related to environmental compliance regulations and restraints.
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The marketability of any minerals acquired or discovered may be affected by
numerous factors which are beyond our control and which cannot be accurately
predicted, such as market fluctuations, the lack of milling facilities and
processing equipment near the Dap Property, and other factors such as government
regulations, including regulations relating to allowable production, the
importing and exporting of minerals, and environmental protection.
Given the above noted risks, the chances of our finding and commercially
exploiting reserves on our mineral properties are remote and funds expended on
exploration will likely be lost.
BECAUSE OF THE INHERENT DANGERS INVOLVED IN MINERAL EXPLORATION, THERE IS A RISK
THAT WE MAY INCUR LIABILITY OR DAMAGES AS WE CONDUCT OUR BUSINESS.
The search for valuable minerals involves numerous hazards. As a result, we may
become subject to liability for such hazards, including pollution, cave-ins and
other hazards against which we cannot insure or against which we may elect not
to insure. At the present time we have no insurance to cover against these
hazards. The payment of such liabilities may result in our inability to complete
our planned exploration program and/or obtain additional financing to fund our
exploration program.
AS WE UNDERTAKE EXPLORATION OF OUR MINERAL CLAIMS, WE WILL BE SUBJECT TO
COMPLIANCE WITH GOVERNMENT REGULATION THAT MAY INCREASE THE ANTICIPATED COST OF
OUR EXPLORATION PROGRAM.
There are several governmental regulations that materially restrict mineral
exploration. We will be subject to the laws of the State of Nevada as we carry
out our exploration program. We may be required to obtain work permits, post
bonds and perform remediation work for any physical disturbance to the land in
order to comply with these laws. If we enter the production phase, the cost of
complying with permit and regulatory environment laws will be greater because
the impact on the project area is greater. Permits and regulations will control
all aspects of the production program if the project continues to that stage.
Examples of regulatory requirements include:
(a) Water discharge will have to meet drinking water standards;
(b) Dust generation will have to be minimal or otherwise re-mediated;
(c) Dumping of material on the surface will have to be re-contoured and
re-vegetated with natural vegetation;
(d) An assessment of all material to be left on the surface will need to
be environmentally benign;
(e) Ground water will have to be monitored for any potential contaminants;
(f) The socio-economic impact of the project will have to be evaluated and
if deemed negative, will have to be remediated; and
(g) There will have to be an impact report of the work on the local fauna
and flora including a study of potentially endangered species.
15
There is a risk that new regulations could increase our costs of doing business
and prevent us from carrying out our exploration program. We will also have to
sustain the cost of reclamation and environmental remediation for all
exploration work undertaken. Both reclamation and environmental remediation
refer to putting disturbed ground back as close to its original state as
possible. Other potential pollution or damage must be cleaned-up and renewed
along standard guidelines outlined in the usual permits. Reclamation is the
process of bringing the land back to its natural state after completion of
exploration activities. Environmental remediation refers to the physical
activity of taking steps to remediate, or remedy, any environmental damage
caused. The amount of these costs is not known at this time as we do not know
the extent of the exploration program that will be undertaken beyond completion
of the recommended work program. If remediation costs exceed our cash reserves
we may be unable to complete our exploration program and have to abandon our
operations.
BECAUSE OUR SOLE OFFICER AND/OR DIRECTORS DO NOT HAVE FORMAL TRAINING SPECIFIC
TO THE TECHNICALITIES OF MINERAL EXPLORATION, THERE IS A HIGHER RISK OUR
BUSINESS WILL FAIL.
Our sole officer is Janet Janes. Our directors are Janet Janes and Athanasios
Tsiodras. Neither Ms. Janes nor Mr. Tsiodras have any formal training as a
geologist or in the technical aspects of management of a mineral exploration
company. With no direct training or experience in these areas, our management
may not be fully aware of the specific requirements related to working within
this industry. Our management's decisions and choices may not take into account
standard engineering or managerial approaches mineral exploration companies
commonly use. Consequently, our operations, earnings, and ultimate financial
success could suffer irreparable harm due to management's lack of experience in
this industry.
THERE IS A RISK THAT OUR PROPERTY DOES NOT CONTAIN ANY KNOWN BODIES OF ORE
RESULTING IN ANY FUNDS SPENT ON EXPLORATION BEING LOST.
There is the likelihood of our mineral claim containing little or no economic
mineralization or reserves. We have a geological report detailing previous
exploration in the area, and the claim has been staked per Nevada regulations.
However, there is the possibility that previous work conducted was not carried
out properly and our claim does not contain any reserves, resulting in any funds
spent on exploration being lost.
BECAUSE WE HAVE NOT SURVEYED THE DAP 1-4 CLAIMS, WE MAY DISCOVER MINERALIZATION
ON THE CLAIMS THAT IS NOT WITHIN OUR CLAIM BOUNDARIES.
While we have conducted a mineral claim title search, this should not be
construed as a guarantee of claim boundaries. Until he claim is surveyed, the
precise location of the boundaries of the claim may be in doubt. If we discover
mineralization that is close to the claim boundaries, it is possible that some
or all of the mineralization may occur outside the boundaries. In such a case we
would not have the right to extract those minerals.
IF WE DISCOVER COMMERCIAL RESERVES OF PRECIOUS METALS ON OUR MINERAL PROPERTY,
WE CAN PROVIDE NO ASSURANCE THAT WE WILL BE ABLE TO SUCCESSFULLY ADVANCE THE
MINERAL CLAIMS INTO COMMERCIAL PRODUCTION.
16
If our exploration program is successful in establishing ore of commercial
tonnage and grade, we will require additional funds in order to advance the
claim into commercial production. Obtaining additional financing would be
subject to a number of factors, including the market price for the minerals,
investor acceptance of our claims and general market conditions. These factors
may make the timing, amount, terms or conditions of additional financing
unavailable to us. The most likely source of future funds is through the sale of
equity capital. Any sale of share capital will result in dilution to existing
shareholders. We may be unable to obtain any such funds, or to obtain such funds
on terms that we consider economically feasible.
IF ACCESS TO OUR MINERAL CLAIMS IS RESTRICTED BY INCLEMENT WEATHER, WE MAY BE
DELAYED IN OUR EXPLORATION AND ANY FUTURE MINING EFFORTS.
It is possible that snow or rain could cause the mining roads providing access
to our claims to become impassable. If the roads are impassable we would be
delayed in our exploration timetable.
BASED ON CONSUMER DEMAND, THE GROWTH AND DEMAND FOR ANY ORE WE MAY RECOVER FROM
OUR CLAIMS MAY BE SLOWED, RESULTING IN REDUCED REVENUES TO THE COMPANY.
Our success will be dependent on the growth of demand for ores. If consumer
demand slows our revenues may be significantly affected. This could limit our
ability to generate revenues and our financial condition and operating results
may be harmed.
BECAUSE OUR CURRENT OFFICER AND DIRECTORS HAVE OTHER BUSINESS INTERESTS, THEY
MAY NOT BE ABLE OR WILLING TO DEVOTE A SUFFICIENT AMOUNT OF TIME TO OUR BUSINESS
OPERATIONS, CAUSING OUR BUSINESS TO FAIL.
Ms. Janet Janes, our officer and director, and Mr. Athanasios Tsiodras, our
director, currently devotes approximately 5 - 6 hours per week providing
management services to us. While they presently possess adequate time to attend
to our interest, it is possible that the demands on them from other obligations
could increase, with the result that they would no longer be able to devote
sufficient time to the management of our business. This could negatively impact
our business development.
ITEM 2. PROPERTIES
We currently do not own any physical property or own any real property. We
purchased the Dap Property at a cost of $7,000. Title to the Dap Property is
held by Canusa Capital Corp. We currently utilize space provided to us on a rent
free basis from our officer and director, Janet Janes at 68220 Espada Road,
Cathedral City, CA 92234. Management believes the current premises are
sufficient for its needs at this time.
ITEM 3. LEGAL PROCEEDINGS
We are not currently a party to any legal proceedings, and we are not aware of
any pending or potential legal actions.
17
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the fiscal year
ended April 30, 2008.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Our common stock was listed on the OTC Bulletin Board on February 13, 2008. The
symbol is CUSA. There has been no active trading and no high or low bid prices.
Of the 2,500,000 shares of common stock outstanding as of April 30, 2008,
1,500,000 shares are owned by Athanasios Tsiodras, a director, and may only be
resold in compliance with Rule 144 of the Securities Act of 1933.
As of April 30, 2008, we have 2,500,000 shares of $0.001 par value common stock
issued and outstanding held by 31 shareholders of record.
The stock transfer agent for our securities is Signature Stock Transfer, Inc.
DIVIDENDS
We have never declared or paid any cash dividends on our common stock. For the
foreseeable future, we intend to retain any earnings to finance the development
and expansion of our business, and we do not anticipate paying any cash
dividends on our common stock. Any future determination to pay dividends will be
at the discretion of the Board of Directors and will be dependent upon then
existing conditions, including our financial condition and results of
operations, capital requirements, contractual restrictions, business prospects,
and other factors that the board of directors considers relevant.
SECTION RULE 15(g) OF THE SECURITIES EXCHANGE ACT OF 1934
The Company's shares are covered by Section 15(g) of the Securities Exchange Act
of 1934, as amended that imposes additional sales practice requirements on
broker/dealers who sell such securities to persons other than established
customers and accredited investors (generally institutions with assets in excess
of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual
income exceeding $200,000 or $300,000 jointly with their spouses). For
transactions covered by the Rule, the broker/dealer must make a special
suitability determination for the purchase and have received the purchaser's
written agreement to the transaction prior to the sale. Consequently, the Rule
may affect the ability of broker/dealers to sell our securities and also may
affect your ability to sell your shares in the secondary market.
Section 15(g) also imposes additional sales practice requirements on
broker/dealers who sell penny securities. These rules require a one page summary
of certain essential items. The items include the risk of investing in penny
stocks in both public offerings and secondary marketing; terms important to in
18
understanding of the function of the penny stock market, such as "bid" and
"offer" quotes, a dealers "spread" and broker/dealer compensation; the
broker/dealer compensation, the broker/dealers duties to its customers,
including the disclosures required by any other penny stock disclosure rules;
the customers rights and remedies in causes of fraud in penny stock
transactions; and, FINRA's toll free telephone number and the central number of
the North American Administrators Association, for information on the
disciplinary history of broker/dealers and their associated persons.
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
We do not have any equity compensation plans.
SECTION 16(a)
Based solely upon a review of Form 3 and 4 furnished by us under Rule 16a-3(d)
of the Securities Exchange Act of 1934, we are not aware of any individual who
failed to file a required report on a timely basis required by Section 16(a) of
the Securities Exchange Act of 1934.
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
There were no purchases of shares of our common stock by us or any affiliated
purchasers during the year ended April 30, 2008.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
We are still in our exploration stage and have generated no revenues to date.
We incurred operating expenses of $17,244 for the year ended April 30, 2008. For
the year ended April 30, 2007 we incurred operating expenses of $7,631. These
expenses consisted of exploration costs, general operating expenses and
professional fees incurred in connection with the day to day operation of our
business and the preparation and filing of our periodic reports. As of April 30,
2008, there was $8,731 owed to a director of the company, for which there is no
specific terms of repayment.
Our net loss from inception through April 30, 2008 was $24,875.
Our auditors have issued a going concern opinion. This means that there is
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. This is
because we have not generated revenues and no revenues are anticipated until we
begin removing and selling minerals. There is no assurance we will ever reach
that point.
19
LIQUIDITY AND CAPITAL RESOURCES
Our cash balance at April 30, 2008 was $16,356. If we experience a shortage of
funds prior to completing our first two exploration phases we may utilize funds
from a director who has informally agreed to advance funds to allow us to pay
for business operations, however our director has no formal commitment,
arrangement or legal obligation to advance or loan funds to us.
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements.
PLAN OF OPERATION
Our plan of operation for the twelve months is to complete the first two phases
of the exploration program on our claims consisting of detailed prospecting,
mapping, soil geochemistry, and magnetometer and VLF electromagnetic surveys. In
addition to the $15,000 we anticipate spending for the remainder of the first
two phases of the exploration program as outlined below, we anticipate spending
an additional $3,000 on professional fees, including fees payable in complying
with reporting obligations, and general administrative costs. Total expenditures
over the next 12 months are therefore expected to be approximately $18,000.
The following work program has been recommended by the professional geologist
who prepared the geology report for our Dap 1-4 Mineral Claims, North Paymaster
Canyon Area, Esmeralda County, Nevada.
The following three phase exploration proposal and cost estimates are offered
with the understanding that consecutive phases are contingent upon positive
(encouraging) results being obtained from each preceding phase and additional
funding for Phase 3:
Phase 1 Detailed Prospecting, mapping and $10,000
soil geochemistry
Phase 2 Magnetometer and VLF electromagnetic, $10,000
Grid controlled surveys over the areas
of interest determined by the Phase 1
survey. Included in this estimated
cost is transportation, accommodation,
board, grid installation, two geophysical
surveys, maps and report
Phase 3 Induced polarization survey over grid $30,000
Controlled anomalous area of interest
Outlined by Phase 1 and 2 field work.
Hoe or bulldozer trenching, mapping and
sampling of bedrock anomalies. Includes
Assays, detailed maps and reports.
-------
TOTAL ESTIMATED COSTS $50,000
=======
20
The above program costs are management's estimates based upon the
recommendations of the professional mining geologist's report and the actual
project costs may exceed our estimates.
We have authorized James McLeod, the professional geologist, who prepared the
geology report on the Dap mining claims, to commence the first phase of our
exploration program which consists of detailed prospecting, mapping and soil
geochemistry. We have a verbal agreement with Mr. McLeod to retain his services
for all of our planned exploration program. We will require additional funding
to proceed with the Phase 3 exploration work on the claim. At this date, we have
no current plans on how to raise the additional funding. We cannot provide
investors with any assurance that we will be able to raise sufficient funds to
proceed with any work after the first two phases of the exploration program.
21
ITEM 8. FINANCIAL STATEMENTS
GEORGE STEWART, CPA
2301 SOUTH JACKSON STREET, SUITE 101-G
SEATTLE, WASHINGTON 98144
(206) 328-8554 FAX(206) 328-0383
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Canusa Capital, Corp.
I have audited the accompanying balance sheets of Canusa Capital, Corp. (An
Exploration Stage Company) as of April 30, 2008 and 2007, and the related
statement of operations, stockholders' equity and cash flows for the years then
ended and from December 27, 2006 (inception), to April 30, 2008. These financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these financial statements based on my audit.
I conducted my audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that I plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. I believe that my audit provides a reasonable
basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Canusa Capital, Corp., (An
Exploration Stage Company) as of April 30, 2008 and 2007, and the results of its
operations and cash flows for the years then ended and from December 27, 2006
(inception), to April 30, 2008 in conformity with generally accepted accounting
principles in the United States of America.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note # 6 to the financial
statements, the Company has had no operations and has no established source of
revenue. This raises substantial doubt about its ability to continue as a going
concern. Management's plan in regard to these matters is also described in Note
# 6. The financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
/s/ George Stewart, CPA
- ---------------------------------
Seattle, Washington
July 11, 2008
22
Canusa Capital Corp.
(An Exploration Stage Company)
Balance Sheet
- --------------------------------------------------------------------------------
April 30, April 30,
2008 2007
-------- --------
ASSETS
CURRENT ASSETS
Cash $ 16,337 $ 500
Savings 19
-------- --------
TOTAL CURRENT ASSETS 16,356 500
OTHER ASSETS -- --
-------- --------
TOTAL OTHER ASSETS -- --
-------- --------
TOTAL ASSETS $ 16,356 $ 500
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Loan from Director $ 8,731 $ 631
-------- --------
TOTAL CURRENT LIABILITIES 8,731 631
TOTAL LIABILITIES 8,731 631
STOCKHOLDERS' EQUITY
Common stock, ($0.001 par value, 100,000,000 shares authorized;
2,500,000 and 1,500,000 shares issued and outstanding
as of January 31, 2008 and April 30, 2007 respectively 2,500 1,500
Additional paid-in capital 30,000 6,000
Deficit accumulated during Development stage (24,875) (7,631)
-------- --------
TOTAL STOCKHOLDERS' EQUITY 7,625 (131)
-------- --------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 16,356 $ 500
======== ========
See Notes to Financial Statements
23
Canusa Capital Corp.
(An Exploration Stage Company)
Statement of Operations
- --------------------------------------------------------------------------------
December 27, 2006
(inception)
Year Ended Year Ended through
April 30, April 30, April 30,
2008 2007 2008
---------- ---------- ----------
REVENUES
Revenues $ -- $ -- $ --
---------- ---------- ----------
TOTAL REVENUES -- --
GENERAL & ADMINISTRATIVE EXPENSES 17,244 7,631 24,875
---------- ---------- ----------
TOTAL GENERAL & ADMINISTRATIVE EXPENSES (17,244) (7,631) (24,875)
---------- ---------- ----------
NET INCOME (LOSS) $ (17,244) $ (7,631) $ (24,875)
========== ========== ==========
BASIC EARNINGS PER SHARE $ (0.01) $ (0.01)
========== ==========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 1,960,492 1,500,000
========== ==========
See Notes to Financial Statements
24
Canusa Capital Corp.
(An Exploration Stage Company)
Statement of Changes in Stockholders' Equity
From December 27, 2006 (Inception) through April 30, 2008
- --------------------------------------------------------------------------------
Deficit
Accumulated
Common Additional Development
Common Stock Paid-in During
Stock Amount Capital Stage Total
----- ------ ------- ----- -----
BALANCE, DECEMBER 27, 2006 -- $ -- $ -- $ -- $ --
Stock issued for cash on
December 27, 2006 @ $0.005
per share 1,500,000 1,500 6,000 -- 7,500
Net loss, April 30, 2007 (7,631) (7,631)
---------- ------- -------- --------- --------
BALANCE, APRIL 30, 2007 1,500,000 $ 1,500 $ 6,000 $ (7,631) $ (131)
========== ======= ======== ========= ========
Stock issued for cash
on Oct 10, 2007 @$0.025 80,000 80 1,920 2,000
Stock issued for cash
on Oct 19, 2007 @$0.025 80,000 80 1,920 2,000
Stock issued for cash
on Oct 22, 2007 @$0.025 80,000 80 1,920 2,000
Stock issued for cash
on Oct 24, 2007 @$0.025 60,000 60 1,440 1,500
Stock issued for cash
on Oct 26, 2007 @$0.025 40,000 40 960 1,000
Stock issued for cash
on Oct 31, 2007 @$0.025 40,000 40 960 1,000
Stock issued for cash
on Nov 1, 2007 @$0.025 80,000 80 1,920 2,000
Stock issued for cash
on Dec. 4, 2007 @$0.025 540,000 540 12,960 13,500
Net loss, April 30, 2008 (17,244) (17,244)
---------- ------- -------- --------- --------
BALANCE, APRIL 30, 2008 2,500,000 $ 2,500 $ 30,000 $ (24,875) $ 7,625
========== ======= ======== ========= ========
See Notes to Financial Statements
25
Canusa Capital Corp.
(An Exploration Stage Company)
Statement of Cash Flows
- --------------------------------------------------------------------------------
December 27, 2006
(inception)
Year Ended Year Ended through
April 30, April 30, April 30,
2008 2007 2008
-------- -------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(17,244) $ (7,631) $(24,875)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Changes in operating assets and liabilities:
Increase (Decrease) in Loans from Director $ 8,100 $ 631 $ 8,731
-------- -------- --------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (9,144) (7,000) (16,144)
CASH FLOWS FROM INVESTING ACTIVITIES
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES -- -- --
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of common stock 1,000 1,500 2,500
Additional paid-in capital 24,000 6,000 30,000
-------- -------- --------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 25,000 7,500 32,500
-------- -------- --------
NET INCREASE (DECREASE) IN CASH 15,856 500 16,356
CASH AT BEGINNING OF PERIOD 500 -- --
-------- -------- --------
CASH AT END OF YEAR $ 16,356 $ 500 $ 16,356
======== ======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ -- $ -- $ --
======== ======== ========
Income Taxes $ -- $ -- $ --
======== ======== ========
See Notes to Financial Statements
26
Canusa Capital Corp.
(An Exploration Stage Company)
Notes to Financial Statements
April 30, 2008 and 2007
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Canusa Capital Corp. (the Company) was incorporated on December 27, 2006 under
the laws of the State of Delaware. The Company is beneficial owner of Dap 1-4
Mineral Claims, North Paymaster Canyon Area, Esmeralda County, Nevada, USA. The
Company is primarily engaged in the acquisition and exploration of mining
properties.
The Company has been in the exploration stage since its formation and has not
yet realized any revenues from its planned operations. Upon the location of
commercially mineable reserves, the Company plans to prepare for mineral
extraction and enter the development stage.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The Company reports revenues and expenses using the accrual method of accounting
for financial and tax reporting purposes.
USE OF ESTIMATES
Management uses estimates and assumptions in preparing these financial
Statements in accordance with generally accepted accounting principles. Those
estimates and assumptions affect the reported amounts of assets and liabilities,
the disclosure of contingent assets and liabilities, and the reported revenues
and expenses.
PRO FORMA COMPENSATION EXPENSE
No stock options have been issued by Canusa Capital Corp. Accordingly, no pro
forma compensation expense is reported in these financial statements.
MINERAL PROPERTY ACQUISITION AND EXPLORATION COSTS
The company expenses all costs related to the acquisition and exploration of
mineral properties in which it has secured exploration rights prior to
establishment of proven and probable reserves. To date, the Company has not
established the commercial feasibility of any exploration prospects; therefore,
all costs are being expensed.
DEPRECIATION, AMORTIZATION AND CAPITALIZATION
The Company records depreciation and amortization when appropriate using both
straight-line and declining balance methods over the estimated useful life of
the assets (five to seven years). Expenditures for maintenance and repairs are
charged to expense as incurred. Additions, major renewals and replacements that
27
Canusa Capital Corp.
(An Exploration Stage Company)
Notes to Financial Statements
April 30, 2008 and 2007
increase the property's useful life are capitalized. Property sold or retired,
together with the related accumulated depreciation is removed from the
appropriated accounts and the resultant gain or loss is included in net income.
INCOME TAXES
The Company accounts for its income taxes in accordance with Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes". Under
Statement 109, a liability method is used whereby deferred tax assets and
liabilities are determined based on temporary differences between basis used for
financial reporting and income tax reporting purposes. Income taxes are provided
based on tax rates in effect at the time such temporary differences are expected
to reverse. A valuation allowance is provided for certain deferred tax assets if
it is more likely than not, that the Company will not realize the tax assets
through future operations.
FAIR VALUE OF FINANCIAL INSTRUMENTS
Financial accounting Standards statements No. 107, "Disclosures About Fair Value
of Financial Instruments", requires the Company to disclose, when reasonably
attainable, the fair market values of its assets and liabilities which are
deemed to be financial instruments. The Company's financial instruments consist
primarily of cash and certain investments.
INVESTMENTS
Investments that are purchased in other companies are valued at cost less any
impairment in the value that is other that temporary in nature.
PER SHARE INFORMATION
The Company computes per share information by dividing the net loss for the
period presented by the weighted average number of shares outstanding during
such period.
NOTE 3 - PROVISION FOR INCOME TAXES
The provision for income taxes for the period ended April 30, 2008 represents
the minimum state income tax expense of the Company, which is not considered
significant.
NOTE 4 - COMMITMENTS AND CONTINGENCIES
LITIGATION
The Company is not presently involved in any litigation.
28
Canusa Capital Corp.
(An Exploration Stage Company)
Notes to Financial Statements
April 30, 2008 and 2007
NOTE 5 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
In July 2006, the FASB issued FASB Interpretation (FIN) No. 48, "Accounting for
Uncertainty in Income Taxes--An Interpretation of FASB Statement No. 109" (FIN
48). This Interpretation clarifies the accounting for uncertainty in income
taxes recognized in a company's financial statements. FIN 48 requires companies
to determine whether it is "more likely than not" that a tax position will be
sustained upon examination by the appropriate taxing authorities before any part
of the benefit can be recorded in the financial statements. It also provides
guidance on the recognition, measurement and classification of income tax
uncertainties, along with any related interest and penalties. FIN 48 will also
require significant additional disclosures. This Interpretation will be
effective for fiscal years beginning after December 15, 2006. We will implement
this Interpretation in the first quarter of 2007 on a prospective basis. We are
currently evaluating the potential impact this Interpretation will have on our
financial position and results of operations.
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" (SFAS
157), which provides guidance on how to measure assets and liabilities that use
fair value. SFAS 157 will apply whenever another US GAAP standard requires (or
permits) assets or liabilities to be measured at fair value but does not expand
the use of fair value to any new circumstances. This standard also will require
additional disclosures in both annual and quarterly reports. SFAS 157 will be
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and will be adopted by us beginning in the first quarter of
2008. We are currently evaluating the potential impact this standard may have on
our financial position and results of operations, but do not believe the impact
of the adoption will be material.
In September 2006, the SEC staff issued Staff Accounting Bulletin (SAB) No. 108,
"Considering the Effects of Prior Year Misstatements when Quantifying
Misstatements in Current Year Financial Statements" (SAB 108). SAB 108 was
issued in order to eliminate the diversity of practice in how public companies
quantify misstatements of financial statements, including misstatements that
were not material to prior years' financial statements. We will initially apply
the provisions of SAB 108 in connection with the preparation of our annual
financial statements for the year ending December 31, 2006. We have evaluated
the potential impact SAB 108 may have on our financial position and results of
operations and do not believe the impact of the application of this guidance
will be material.
29
Canusa Capital Corp.
(An Exploration Stage Company)
Notes to Financial Statements
April 30, 2008 and 2007
NOTE 6 - GOING CONCERN
Future issuances of the company's equity or debt securities will be required in
order for the company to continue to finance its operations and continue as a
going concern. The Company's present revenues are insufficient to meet operating
expenses.
The financial statements of the Company have been prepared assuming that the
Company will continue as a going concern, which contemplates, among other
things, the realization of assets and the satisfaction of liabilities in the
normal course of business. The Company has incurred cumulative net losses of $
24,875 since its inception and requires capital for its contemplated operational
and marketing activities to take place. The Company's ability to raise
additional capital through the future issuances of common stock is unknown. The
obtainment of additional financing, the successful development of the Company's
contemplated plan of operations, and its transition, ultimately, to the
attainment of profitable operations are necessary for the Company to continue
operations. The ability to successfully resolve these factors raise substantial
doubt about the Company's ability to continue as a going concern.
The financial statements of the Company do not include any adjustments that may
result from the outcome of these aforementioned uncertainties.
NOTE 7 - RELATED PARTY TRANSACTIONS
Athanasios Tsiodras, Director and Janet Janes, President of the Company may, in
the future, become involved in other business opportunities as they become
available, thus they may face a conflict in selecting between the Company and
their other business opportunities. The company has not formulated a policy for
the resolution of such conflicts.
While the company is seeking additional capital, Mr. Tsiodras has advanced funds
to the company to pay for any costs incurred by it. These funds are interest
free. The balance due Mr. Tsiodras was $ 8,731 on April 30, 2008.
NOTE 8 - STOCK TRANSACTIONS
Transactions, other than employees' stock issuance, are in accordance with
paragraph 8 of SFAS 123. Thus issuances shall be accounted for based on the fair
value of the consideration received. Transactions with employees' stock issuance
are in accordance with paragraphs (16-44) of SFAS 123. These issuances shall be
accounted for based on the fair value of the consideration received or the fair
value of the equity instruments issued, or whichever is more readily
determinable.
30
Canusa Capital Corp.
(An Exploration Stage Company)
Notes to Financial Statements
April 30, 2008 and 2007
On December 27, 2006 the Company issued a total of 1,500,000 shares of common
stock to one director for cash in the amount of $0.005 per share for a total of
$7,500.
Beginning October 10, 2007 the Company began receiving proceeds from a "best
efforts", all or none offering. The company was not able to spend any of the
proceeds unless all the shares were sold and all proceeds were received. The
closing date for the offering was November 30, 2007. The final funds deposit was
December 4, 2007. As of January 31, 2008 1,000,000 shares of common stock were
sold for cash in the amount of $0.025 per share for a total of $ 25,000.
As of April 30, 2008 the Company had 2,500,000 shares of common stock issued and
outstanding.
NOTE 9 - STOCKHOLDERS' EQUITY
The stockholders' equity section of the Company contains the following classes
of capital stock as of April 30, 2008:
Common stock, $0.001 par value: 100,000,000 shares authorized; 2,500,000 shares
issued and outstanding.
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
The term "disclosure controls and procedures" is defined in Rules 13a-15(e) of
the Securities Exchange Act of 1934, or the "Exchange Act." This term refers to
the controls and procedures of a company that are designed to ensure that
information required to be disclosed by a company in the reports that it files
or submits under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified by the SEC. Our management, including
our Principal Executive Officer and Principal Financial Officer, has evaluated
the effectiveness of our disclosure controls and procedures as of the end of the
period covered by this Annual Report on Form 10-K. Based upon that evaluation,
our Principal Executive Officer and Principal Financial Officer have concluded
that our disclosure controls and procedures were effective as of the end of the
period covered by this Annual Report on Form 10-K.
There were no changes to our internal control over financial reporting during
our last fiscal quarter that have materially affected, or are reasonably likely
to materially affect, our internal control over financial reporting.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS
The names, ages and titles of our executive officers and directors are as
follows:
Name and Address of Executive
Officer and Directors Age Position
--------------------- --- --------
Janet Janes 51 President, Secretary, Treasurer
68220 Espada Road and Director
Cathedral City, CA 92234
Athanasios Tsiodras 30 Director
Korinthou 46
21200 Argos, Argolidos
Greece
The foregoing persons are promoters of Canusa Capital Corp., as that term is
defined in the rules and regulations promulgated under the Securities and
Exchange Act of 1933.
Neither Ms. Janes nor Mr. Tsiodras have any formal training as a geologist or in
the technical or managerial aspects of management of a mineral exploration
company. Their prior business experiences have not been in the mineral
exploration industry. Accordingly, we will have to rely on the technical
services of others to advise us on the managerial aspects specifically
associated with a mineral exploration company. We do not have any employees who
32
have professional training or experience in the mining industry. We rely on
independent geological consultants to make recommendations to us on work
programs on our property, to hire appropriately skilled persons on a contract
basis to complete work programs and to supervise, review, and report on such
programs to us.
TERM OF OFFICE
Members of our Board of Directors are appointed to hold office until the next
annual meeting of our stockholders or until his or her successor is elected and
qualified, or until he or she resigns or is removed in accordance with the
provisions of the Delaware Revised Statutes. Our officers are appointed by our
Board of Directors and hold office until removed by the Board.
SIGNIFICANT EMPLOYEES
We have no significant employees other than our officer and directors. Ms. Janes
and Mr. Tsiodras currently devote approximately 5 - 6 hours per week to company
matters. After receiving funding per our business plan Ms. Janes and Mr.
Tsiodras intend to devote as much time as the board of directors deem necessary
to manage the affairs of the company.
No executive officer or director of the corporation has been the subject of any
order, judgment, or decree of any court of competent jurisdiction, or any
regulatory agency permanently or temporarily enjoining, barring, suspending or
otherwise limited him or her from acting as an investment advisor, underwriter,
broker or dealer in the securities industry, or as an affiliated person,
director or employee of an investment company, bank, savings and loan
association, or insurance company or from engaging in or continuing any conduct
or practice in connection with any such activity or in connection with the
purchase or sale of any securities.
No executive officer or director or the corporation has been convicted in any
criminal proceeding (excluding traffic violations) or is the subject of a
criminal proceeding which is currently pending. We conduct our business through
agreements with consultants and arms-length third parties. Currently, we have no
formal consulting agreements in place. We have a verbal arrangement with the
consulting geologist currently conducting the exploratory work on the Dap
Property. We pay the consulting geologist the usual and customary rates received
by geologists performing similar consulting services.
RESUMES
JANET JANES serves as Secretary, Treasurer of Canusa Capital Corp. since April,
2007 and President and Director since June, 2007 to current. From 1999 to 2007,
Ms. Janes owns and operates Janet E. Janes Bookkeeping Services located in
Cathedral City, CA. She contracts bookkeeping services to various businesses
including retail, financial, medical and transportation companies From 1993 to
1999, Ms. Janes owned and operated Janet E. Janes Bookkeeping Services in
Nanaimo, British Columbia.
33
ATHANASIOS TSIODRAS served as president of Canusa Capital Corp. since inception
until June, 2007 and serves as director since inception December, 2006 to
current. From 1998 to 2007, Mr. Tsiodras is the proprietor and operates Argos
Tours, a travel agency located in Argos, Argolidos, Greece. Mr. Tsiodras is
responsible for all managerial duties associated with the travel industry
specializing in cruises and group tours in Greece and worldwide. From 1997 to
1998, he worked as a travel agent at Argos Tours. From 1995 to 1997, Mr.
Tsiodras majored in English at College Platon.
CODE OF ETHICS
We do not currently have a code of ethics, because we have only limited business
operations and only one officer and two directors, we believe a code of ethics
would have limited utility. We intend to adopt such a code of ethics as our
business operations expand and we have more directors, officers and employees.
ITEM 11. EXECUTIVE COMPENSATION
MANAGEMENT COMPENSATION
Our current officer is Janet Janes. The current Board of Directors is comprised
of Janet Janes and Athanasios Tsiodras.
The table below summarizes all compensation awarded to, earned by, or paid to
our executive officers by any person for all services rendered in all capacities
to us for the period from our inception through to April 30, 2007, our most
recently completed fiscal year:
Annual Compensation Long Term Compensation
--------------------------------- ---------------------------------
Restricted
Other Annual Stock Options/* LTIP All Other
Name Title Year Salary($) Bonus Compensation Awarded SARs(#) payouts($) Compensation
- ---- ----- ---- --------- ----- ------------ ------- ------- ---------- ------------
Janet Jane President, 2008 $0 $0 $0 $0 $0 $0 $0
Secretary, 2007 $0 $0 $0 $0 $0 $0 $0
Treasurer,
and Director
Athanasios Director 2008 $0 $0 $0 $0 $0 $0 $0
Tsiodras 2007 $0 $0 $0 $0 $0 $0 $0
2006 $0 $0 $0 $0 $0 $0 $0
There are no current employment agreements between the company and its officer
or directors.
On December 27, 2006, a total of 1,500,000 shares of common stock were issued to
Mr. Tsiodras in exchange for cash in the amount of $7,500 or $.005 per share.
The terms of this stock issuance was as fair to the company, in the opinion of
the board of directors, as if it could have been made with an unaffiliated third
party.
Ms. Janes and Mr. Tsiodras currently devote approximately 5 - 6 hours per week
to manage the affairs of the company. They have agreed to work with no
remuneration until such time as the company receives sufficient revenues
34
necessary to provide management salaries. At this time, we cannot accurately
estimate when sufficient revenues will occur to implement this compensation, or
what the amount of the compensation will be.
There are no annuity, pension or retirement benefits proposed to be paid to the
officer or directors or employees in the event of retirement at normal
retirement date pursuant to any presently existing plan provided or contributed
to by the company or any of its subsidiaries, if any.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information concerning the number of
shares of our common stock owned beneficially as of April 30, 2008 by: (i) each
person (including any group) known to us to own more than five percent (5%) of
any class of our voting securities, (ii) our director, and or (iii) our officer.
Unless otherwise indicated, the stockholder listed possesses sole voting and
investment power with respect to the shares shown.
Amount and Nature
of Beneficial Percentage of
Title of Class Name and Address of Beneficial Owner Ownership Common Stock(1)
- -------------- ------------------------------------ --------- ---------------
Common Stock Athanasios Tsiodras, Director 1,500,000
Korinthou 46 Direct 60%
21200 Argos
Argolidos
Greece
Common Stock Officer and Directors as a Group 1,500,000 60%
HOLDERS OF MORE THAN 5% OF OUR COMMON STOCK
Common Stock Athanasios Tsiodras, Director 1,500,000
Korinthou 46 Direct 60%
21200 Argos
Argolidos
Greece
- ----------
(1) A beneficial owner of a security includes any person who, directly or
indirectly, through any contract, arrangement, understanding, relationship,
or otherwise has or shares: (i) voting power, which includes the power to
vote, or to direct the voting of shares; and (ii) investment power, which
includes the power to dispose or direct the disposition of shares. Certain
shares may be deemed to be beneficially owned by more than one person (if,
for example, persons share the power to vote or the power to dispose of the
shares). In addition, shares are deemed to be beneficially owned by a
person if the person has the right to acquire the shares (for example, upon
exercise of an option) within 60 days of the date as of which the
information is provided. In computing the percentage ownership of any
person, the amount of shares outstanding is deemed to include the amount of
shares beneficially owned by such person (and only such person) by reason
of these acquisition rights. As a result, the percentage of outstanding
shares of any person as shown in this table does not necessarily reflect
the person's actual ownership or voting power with respect to the number of
shares of common stock actually outstanding on April 30, 2008. As of April
30, 2008, there were 2,500,000 shares of our common stock issued and
outstanding.
35
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Ms. Janes and Mr. Tsiodras were not paid for any underwriting services that they
performed on our behalf with respect to our recent offering. They will also not
receive any interest on any funds that they may advance to us for expenses
incurred.
On December 27, 2006, a total of 1,500,000 shares of Common Stock was issued to
Mr. Tsiodras in exchange for $7,500, or $.0.005 per share. All of such shares
are "restricted" securities, as that term is defined by the Securities act of
1933, as amended, and are held by a director of the Company. (See "Principal
Stockholders".)
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The total fees charged to the company for audit services, including quarterly
reviews, were $2,900, audit-related services were $3,900, tax services were $Nil
and other services were $Nil during the year ended April 30, 2008.
There were no fees charged to the company for audit services, audit-related
services, tax services or other services for the year ended April 30, 2007.
36
PART IV
ITEM 15. EXHIBITS
The following exhibits are included with this filing:
Exhibit
Number Description
------ -----------
3(i) Articles of Incorporation*
3(ii) Bylaws*
31.1 Sec. 302 Certification of CEO
31.2 Sec. 302 Certification of CFO
32.1 Sec. 906 Certification of CEO
32.2 Sec. 906 Certification of CFO
- ----------
* Included in our SB-2 filing under Commission File Number 333-144279.
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
July 22, 2008 Canusa Capital Corp., Registrant
By: /s/ Janet Janes
-------------------------------------
Janet Janes, President and
Chief Executive Officer
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
July 22, 2008 Canusa Capital Corp., Registrant
By: /s/ Janet Janes
-------------------------------------
Janet Janes, President, Secretary and
Treasurer Chief Financial Officer
(Principal Executive Officer and
Principal Accounting Officer)
37