UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JANUARY 31, 2009
Commission file number 333-138107
LIBERTY ENERGY CORP.
(Exact name of registrant as specified in its charter)
NEVADA
(State or other jurisdiction of incorporation or organization)
Church Barn, 3 Church Lane
Barlby, Selby, England YO8 5JG
(Address of principal executive offices, including zip code)
(775)981-9022
(Telephone number, including area code)
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 last 90 days. YES [X] NO [ ]
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,"
"non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the
Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). YES [X] NO [ ]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 60,000,000 shares as of February 18,
2009.
ITEM 1. FINANCIAL STATEMENTS
The un-audited quarterly financial statements for the period ended January 31,
2009, prepared by the company, immediately follow.
2
LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Balance Sheet
- --------------------------------------------------------------------------------
As of As of
January 31, July 31,
2009 2008
-------- --------
ASSETS
CURRENT ASSETS
Cash $ 29,975 $ 39,033
-------- --------
TOTAL CURRENT ASSETS 29,975 39,033
-------- --------
$ 29,975 $ 39,033
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Payable to a Director 5,000 5,000
-------- --------
TOTAL CURRENT LIABILITIES 5,000 5,000
TOTAL LIABILITIES 5,000 5,000
STOCKHOLDERS' EQUITY
Common stock, ($0.001 par value, 150,000,000 shares
authorized; 60,000,000 shares issued and outstanding
as of January 31, 2009 and July 31, 2008 respectively 60,000 60,000
Additional paid-in capital 6,000 6,000
Deficit accumulated during exploration stage (41,025) (31,967)
-------- --------
TOTAL STOCKHOLDERS' EQUITY 24,975 34,033
-------- --------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 29,975 $ 39,033
======== ========
See Notes to Financial Statements
3
LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Statement of Operations
- --------------------------------------------------------------------------------
June 6, 2006
Three Months Three Months Six Months Six Months (inception)
Ended Ended Ended Ended through
January 31, January 31, January 31, January 31, January 31,
2009 2008 2009 2008 2009
----------- ----------- ----------- ----------- -----------
REVENUES
Revenues $ -- $ -- $ -- $ -- $ 100
----------- ----------- ----------- ----------- -----------
TOTAL REVENUES -- -- -- -- 100
PROFESSIONAL FEES 1,400 1,100 5,200 3,500 19,296
GENERAL & ADMINISTRATIVE EXPENSES 920 5,470 3,858 5,820 21,828
----------- ----------- ----------- ----------- -----------
TOTAL GENERAL & ADMINISTRATIVE EXPENSES (2,320) (6,570) (9,058) (9,320) (41,124)
----------- ----------- ----------- ----------- -----------
NET INCOME (LOSS) $ (2,320) $ (6,570) $ (9,058) $ (9,320) $ (41,025)
=========== =========== =========== =========== ===========
BASIC EARNINGS PER SHARE $ (0.00) $ (0.00) $ (0.00) $ (0.00)
=========== =========== =========== ===========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 60,000,000 60,000,000 60,000,000 60,000,000
=========== =========== =========== ===========
See Notes to Financial Statements
4
LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Statement of Cash Flows
- --------------------------------------------------------------------------------
June 6, 2006
Six Months Six Months (inception)
Ended Ended through
January 31, January 31, January 31,
2009 2008 2009
-------- -------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ (9,058) $ (9,320) $(41,025)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Changes in operating assets and liabilities:
Deposit -- 3,000 --
Payable to a Director -- -- 5,000
-------- -------- --------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (9,058) (6,320) (36,025)
CASH FLOWS FROM INVESTING ACTIVITIES
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES -- -- --
CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of common stock -- -- 60,000
Additional paid-in capital -- -- 6,000
-------- -------- --------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES -- -- 66,000
-------- -------- --------
NET INCREASE (DECREASE) IN CASH (9,058) (6,320) 29,975
CASH AT BEGINNING OF PERIOD 39,033 53,146 --
-------- -------- --------
CASH AT END OF YEAR $ 29,975 $ 46,826 $ 29,975
======== ======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ -- $ -- $ --
======== ======== ========
Income Taxes $ -- $ -- $ --
======== ======== ========
See Notes to Financial Statements
5
LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Notes to Financial Statements
January 31, 2009
- --------------------------------------------------------------------------------
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Liberty Energy Corp. (f/k/a DMA Minerals Inc., the "Company") was incorporated
on June 6, 2006 under the laws of the State of Nevada.
The Company carried out exploration on a mineral claim known as the TG Mineral
Claim. The initial phase of exploration included detailed prospecting and
mineralization mapping, followed by hand trenching to obtain clean, fresh
samples. Based on the information available to it from its Phase I exploration
program, it was determined that the TG Mineral Claim did not, in all likelihood,
contain a commercially viable mineral deposit, and it therefore abandoned any
further exploration on the property.
As a result, the Company is investigating several other business opportunities
to enhance shareholder value, and is focused on the oil and gas industry with
the acquisition of oil and natural gas assets both in Canada and the United
States.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The Company reports revenue and expenses using the accrual method of accounting
for financial and tax reporting purposes. The Company has elected a July 31,
year-end.
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 Liberty Energy 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.
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LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Notes to Financial Statements
January 31, 2009
- --------------------------------------------------------------------------------
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
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
increase the property's useful life are capitalized. Property sold or retired,
together with the related accumulated depreciation, is removed from the
appropriate 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 Statement 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 than 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 January 31, 2009 represents
the minimum state income tax expense of the Company, which is not considered
significant.
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LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Notes to Financial Statements
January 31, 2009
- --------------------------------------------------------------------------------
NOTE 4 - COMMITMENTS AND CONTINGENCIES
LITIGATION
The Company is not presently involved in any litigation.
NOTE 5 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
Recently issued accounting pronouncements will have no significant impact on the
Company and its reporting methods.
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 consolidated 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
$41,025 since its inception and requires capital for its contemplated
operational 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
consolidated 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
At of January 31, 2009, a loan payable in the amount of $5,000 was due Daniel
Martinez-Atkinson (a director) of which the loan is non-interest bearing with no
specific repayment terms.
Daniel Martinez-Atkinson, the sole officer and director of the Company may, in
the future, become involved in other business opportunities as they become
available, thus he may face a conflict in selecting between the Company and his
other business opportunities. The Company has not formulated a policy for the
resolution of such conflicts.
8
LIBERTY ENERGY CORP.
(An Exploration Stage Company)
Notes to Financial Statements
January 31, 2009
- --------------------------------------------------------------------------------
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.
On June 6, 2006 the Company issued a total of 30,000,000 shares of common stock
to one director for cash in the amount of $0.0002 per share for a total of
$6,000.
30,000,000 common shares were issued to 26 investors in the Company's SB-2
offering for the aggregate sum of $60,000 in cash. The Regulation SB-2 offering
was declared effective by the Securities and Exchange Commission on November 8,
2006 and completed on December 4, 2006.
Effective June 11, 2008 the Company effected a forward stock spilt of the
authorized, issued and outstanding shares of common stock on a twenty five new
for one old basis. Authorized capital increased from 75,000,000 common shares to
150,000,000 common shares and par value remained at $.001 per share. These
financial statements have been retroactively restated to reflect these changes.
As of January 31, 2009 the Company had 60,000,000 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 January 31, 2009:
Common stock, $ 0.001 par value: 150,000,000 shares authorized; 60,000,000
shares issued and outstanding.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
FORWARD LOOKING STATEMENTS
This report contains forward-looking statements that involve risk and
uncertainties. We use words such as "anticipate", "believe", "plan", "expect",
"future", "intend", and similar expressions to identify such forward-looking
statements. Investors should be aware that all forward-looking statements
contained within this filing are good faith estimates of management as of the
date of this filing. These forward-looking statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from historical results or our predictions.
RESULTS OF OPERATIONS
We are an exploration stage company and have generated $100 in revenues since
inception and have incurred $41,025 in expenses through January 31, 2009. For
the three months ended January 31, 2008 and 2007 we incurred $2,320 and $6,570
in expenses, respectively. These expenses consisted of professional fees and
general and administrative expenses.
The following table provides selected financial data about our company for the
periods ended January 31, 2008 and 2007.
Balance Sheet Data: 1/31/09 1/31/08
------------------- ------- -------
Cash $29,975 56,224
Total assets $29,975 59,224
Total liabilities $ 5,000 5,000
Shareholders' equity $24,975 54,224
Cash provided by financing activities since inception through January 31, 2009
was $66,000, $6,000 from the sale of shares to our officer and director in June
2006 and $60,000 resulting from the sale of our common stock in our initial
public offering to 26 independent investors in December 2006.
LIQUIDITY AND CAPITAL RESOURCES
Our cash balance at January 31, 2009 was $29,975, with $5,000 in outstanding
liabilities consisting of a loan from our director. The loan is non-interest
bearing with no specific terms of repayment. If we experience a shortfall of
cash our director has agreed to loan us additional funds for operating expenses,
however he has no legal obligation to do so. Total expenditures over the next 12
months are expected to be approximately $25,000. We are an exploration stage
company and have generated no revenue to date.
10
PLAN OF OPERATION
The company carried out exploration on a mineral claim known as the TG Mineral
Claim. The initial phase of exploration included detailed prospecting and
mineralization mapping, followed by hand trenching to obtain clean, fresh
samples at a cost of $4,950. Based on the information available to us from our
Phase I exploration program, we determined that the TG Mineral Claim did not, in
all likelihood, contain a commercially viable mineral deposit, and we therefore
abandoned any further exploration on the property.
As a result, we are investigating several other business opportunities to
enhance shareholder value, and are focused on the oil and gas industry with the
acquisition of oil and natural gas assets both in Canada and the United States.
Subject to completing due diligence and funding sources being available if
required we intend to pursue business opportunities in the oil and gas business.
We may require additional funding to proceed. We cannot provide investors with
any assurance that we will be able to raise sufficient funds to fund any work in
the oil and gas business. Our management has also been analyzing other various
alternatives available to our company to ensure our survival and to preserve our
shareholder's investment in our common shares. This analysis has included
sourcing additional forms of financing to continue our business as is while
looking for other exploration targets, or mergers and/or acquisitions. At this
stage in our operations, we believe either course is acceptable, as our
operations have not been profitable and our future prospects for our business
are not good without further financing.
We would focus our preliminary merger/acquisition activities on potential
business opportunities with established business entities for the merger of a
target business with our company. In certain instances, a target business may
wish to become a subsidiary of our company or may wish to contribute assets to
our company rather than merge. We anticipate that any new acquisition or
business opportunities by our company will require additional financing. There
can be no assurance, however, that we will be able to acquire the financing
necessary to enable us to pursue our plan of operation. If our company requires
additional financing and we are unable to acquire such funds, our business may
fail.
In implementing a structure for a particular business acquisition or
opportunity, we may become a party to a merger, consolidation, reorganization,
joint venture, or licensing agreement with another corporation or entity. We may
also acquire stock or assets of an existing business. Upon the consummation of a
transaction, it is likely that our present management will no longer be in
control of our company and our existing business will close down. In addition,
it is likely that our officers and directors will, as part of the terms of the
acquisition transaction, resign and be replaced by one or more new officers and
directors.
We anticipate that the selection of a business opportunity in which to
participate will be complex and without certainty of success. Management
believes that there are numerous firms in various industries seeking the
perceived benefits of being a publicly registered corporation. Business
opportunities may be available in many different industries and at various
stages of development, all of which will make the task of comparative
investigation and analysis of such business opportunities extremely difficult
and complex.
11
We may seek a business opportunity with entities that have recently commenced
operations, or entities who wish to utilize the public marketplace in order to
raise additional capital in order to expand business development activities, to
develop a new product or service, or for other corporate purposes. We may
acquire assets and establish wholly-owned subsidiaries in various businesses or
acquire existing businesses as subsidiaries.
At this stage, we can provide no assurance that we will be able to locate
compatible business opportunities, what additional financing we will require to
complete a combination or merger with another business opportunity or whether
the opportunity's operations will be profitable.
As of the date hereof, we have not been successful in our exploration efforts.
Historically, we have been able to raise a limited amount of capital through
private placements of our equity stock, but we are uncertain about our continued
ability to raise funds privately. Further, we believe that our company may have
more difficulties raising capital for our existing operations than for a new
business opportunity. We have not entered into any formal written agreements for
a business combination or opportunity. If any such agreement is reached, we
intend to disclose such an agreement by filing a current report on Form 8-K with
the Securities and Exchange Commission.
If we are unable to secure adequate capital to continue our business or
alternatively, complete a merger or acquisition, our shareholders will lose some
or all of their investment and our business will likely fail.
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements.
ITEM 4. CONTROLS AND PROCEDURES
Under the supervision and with the participation of our management, including
our principal executive officer and the principal financial officer, we have
conducted an evaluation of the effectiveness of the design and operation of our
disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities and Exchange Act of 1934, as of the end of the period
covered by this report. Based on this evaluation, our principal executive
officer and principal financial officer concluded as of the evaluation date that
our disclosure controls and procedures were effective such that the material
information required to be included in our Securities and Exchange Commission
reports is recorded, processed, summarized and reported within the time periods
specified in SEC rules and forms relating to our company, particularly during
the period when this report was being prepared.
Additionally, there were no significant changes in our internal controls or in
other factors that could significantly affect these controls subsequent to the
evaluation date. We have not identified any significant deficiencies or material
weaknesses in our internal controls, and therefore there were no corrective
actions taken.
12
ITEM 5. OTHER INFORMATION
Effective June 11, 2008, we effected a 25 for one forward stock split of our
authorized and issued and outstanding common stock. As a result, our authorized
capital has increased from 75,000,000 to 1,875,000,000 shares of common stock
and out outstanding share capital has increased from 2,400,000 shares of common
stock to 60,000,000 shares of common stock.
Also effective June 11, 2008, we have changed our name from "DMA Minerals Inc."
to "Liberty Energy Corp.". The change of name was approved by our directors and
a majority of our shareholders.
In addition, effective June 11, 2008, as approved by our directors and a
majority of our shareholders, we reduced our authorized capital from
1,875,000,000 shares of common stock to 150,000,000 shares of common stock.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS
The following exhibits are included with this quarterly filing. Those marked
with an asterisk and required to be filed hereunder, are incorporated by
reference and can be found in their entirety in our original Form SB-2
Registration Statement, filed under SEC File Number 333-138107, at the SEC
website at www.sec.gov:
Exhibit No. Description
----------- -----------
3.1 Articles of Incorporation*
3.2 Bylaws*
31.1 Sec. 302 Certification of Principal Executive Officer
31.2 Sec. 302 Certification of Principal Financial Officer
32.1 Sec. 906 Certification of Principal Executive Officer
32.2 Sec. 906 Certification of Principal Financial Officer
13
SIGNATURES
Pursuant to the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
February 18, 2009 Liberty Energy Corp., Registrant
By: /s/ Daniel Martinez-Atkinson
---------------------------------------------
Daniel Martinez Atkinson, President,
Chief Executive Officer, Principal Accounting
Officer, and Chief Financial 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.
February 18, 2009 Liberty Energy Corp., Registrant
By: /s/ Daniel Martinez-Atkinson
---------------------------------------------
Daniel Martinez Atkinson, President,
Chief Executive Officer, Principal Accounting
Officer, and Chief Financial Officer
14