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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB/A
[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended December 31, 2005
-----------------
[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period to
----------------- --------------------
Commission File Number 001-31669
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TARI INC.
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(Exact name of small Business Issuer as specified in its charter)
Nevada 98-03048905
--------------------------------- -----------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
700 West Pender Street, Suite 802
Vancouver, British Columbia, Canada V6C 1G8
-------------------------------------------
(Address of principal executive offices)
(604) 685-3317
Registrant's telephone number, including area code
None
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(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days [X] Yes [ ] No
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
stock, as of the latest practicable date: 3,890,000 shares of $0.001 par value
common stock outstanding as of February 14, 2006.
<page>
TARI INC.
(A Pre-exploration Stage Company)
INTERIM FINANCIAL STATEMENTS
December 31, 2005
(Stated in US Dollars)
(Unaudited)
-----------
<page>
TARI INC.
(A Pre-exploration Stage Company)
INTERIM BALANCE SHEETS
December 31, 2005 and March 31, 2005
(Stated in US Dollars)
(Unaudited)
-----------
<table>
<caption>
December 31, March 31,
ASSETS 2005 2005
------ ---- ----
<s> <c> <c>
Current
Cash $ 614 $ 2,458
================ ================
LIABILITIES
-----------
Current
Accounts payable and accrued liabilities - Note 4 $ 25,252 $ 15,245
Due to related party - Note 4 19,322 2,155
---------------- ----------------
44,574 17,400
---------------- ----------------
STOCKHOLDERS' DEFICIENCY
------------------------
Preferred stock, $0.001 par value
10,000,000 shares authorized, none outstanding
Common stock, $0.001 par value
100,000,000 shares authorized
3,890,000 (March 31, 2005: 3,890,000) shares issued 3,890 3,890
Additional paid-in capital 90,610 90,610
Deficit accumulated during the pre-exploration stage (138,460) (109,442)
---------------- ----------------
(43,960) (14,942)
---------------- ----------------
$ 614 $ 2,458
================ ================
</table>
SEE ACCOMPANYING NOTES
<page>
TARI INC.
(A Pre-exploration Stage Company)
INTERIM STATEMENTS OF OPERATIONS
for the three and nine months ended December 31, 2005 and 2004,
and for the period May 2, 2001 (Date of Inception) to December 31, 2005
(Stated in US Dollars)
(Unaudited)
-----------
<table>
<caption>
May 2, 2001
(Date of
Three months ended Nine months ended Inception)
December 31, December 31, to December 31,
2005 2004 2005 2004 2005
---- ---- ---- ---- ----
<s> <c> <c> <c> <c> <c>
Expenses
Audit and accounting fees $ 2,931 $ 2,200 $ 9,359 $ 4,224 $ 37,232
Bank charges 43 36 161 180 991
Consulting fees - - - - 15,500
Incorporation costs - - - - 900
Legal fees - - - - 29,768
Management fees - Note 4 1,500 1,500 4,500 3,000 9,000
Mineral lease costs - Note 3 - 5,050 10,217 5,271 27,465
Office expenses 1,200 1,200 3,600 2,400 7,586
Transfer agent and filing fees 239 245 1,181 2,272 10,018
-------------- -------------- -------------- -------------- ----------------
Net loss for the period $ (5,913) $ (5,181) $ (29,018) $ (17,347) $ (138,460)
============== ============== ============== ============== ================
Basic loss per share $ (0.00) $ (0.00) $ (0.01) $ (0.00)
============== ============= ============== ==============
Weighted average number of shares
outstanding 3,890,000 3,890,000 3,890,000 3,890,000
============== ============== ============== ==============
</table>
SEE ACCOMPANYING NOTES
<page>
TARI INC.
(A Pre-exploration Stage Company)
INTERIM STATEMENTS OF CASH FLOWS
for the nine months ended December 31, 2005 and 2004,
and for the period May 2, 2001 (Date of Inception) to December 31, 2005
(Stated in US Dollars)
(Unaudited)
-----------
<table>
<caption>
May 2, 2001
(Date of
Nine months ended Inception)
December 31, to December 31,
2005 2004 2005
---- ---- ----
<s> <c> <c> <c>
Cash Flows used in Operating Activities
Net loss for the period $ (29,018) $ (17,347) $ (138,460)
Change in non-cash working capital item related to
operations:
Accounts payable and accrued liabilities 10,007 3,409 25,252
--------------- --------------- ---------------
(19,011) (13,938) (113,208)
---------------- ---------------- ----------------
Cash Flows provided by Financing Activities
Proceeds from shares issued - - 94,500
Due to related party 17,167 - 19,322
--------------- --------------- ---------------
17,167 - 113,822
--------------- --------------- ---------------
Increase (decrease) in cash during the period (1,844) (13,938) 614
Cash, beginning of the period 2,458 17,698 -
--------------- --------------- ---------------
Cash, end of the period $ 614 $ 3,760 $ 614
=============== =============== ===============
</table>
SEE ACCOMPANYING NOTES
<page>
TARI INC.
(A Pre-exploration Stage Company)
INTERIM STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIENCY)
for the period May 2, 2001 (Date of Inception) to December 31, 2005
(Stated in US Dollars)
(Unaudited)
-----------
<table>
<caption>
Deficit
Accumulated
Additional During the
Common Shares Paid-in Pre-exploration
-----------------------------------
Number Par Value Capital Stage Total
------ --------- ------- ----- -----
<s> <c> <c> <c> <c> <c>
Capital stock issued for cash
- at $0.01 2,500,000 $ 2,500 $ 22,500 $ - $ 25,000
Net loss for the period ended
March 31, 2002 - - - (39,696) (39,696)
---------------- ---------------- ---------------- ---------------- ---------------
Balance, March 31, 2002 2,500,000 2,500 22,500 (39,696) (14,696)
Capital stock subscribed pursuant
to an offering memorandum for
cash - at $0.05 1,390,000 1,390 68,110 - 69,500
Net loss for the year ended
March 31, 2003 - - - (27,653) (27,653)
---------------- ---------------- ---------------- ---------------- ---------------
Balance, March 31, 2003 3,890,000 3,890 90,610 (67,349) 27,151
Net loss for the year ended
March 31, 2004 - - - (17,858) (17,858)
---------------- ---------------- ---------------- ---------------- ---------------
Balance, March 31, 2004 3,890,000 3,890 90,610 (85,207) 9,293
Net loss for the year ended
March 31, 2005 - - - (24,235) (24,235)
---------------- ---------------- ---------------- ---------------- ---------------
Balance, March 31, 2005 3,890,000 3,890 90,610 (109,442) (14,942)
Net loss for the period ended
December 31, 2005 - - - (29,018) (29,018)
---------------- ---------------- ---------------- ---------------- ---------------
Balance, December 31, 2005 3,890,000 $ 3,890 $ 90,610 $ (138,460) $ (43,960)
================ ================ ================ ================ ===============
</table>
SEE ACCOMPANYING NOTES
<page>
TARI INC.
(A Pre-exploration Stage Company)
NOTES TO THE INTERIM FINANCIAL STATEMENTS
December 31, 2005
(Stated in US Dollars)
(Unaudited)
Note 1 Interim Reporting
-----------------
While information presented in the accompanying interim financial
statements is unaudited, it includes all adjustments, which are,
in the opinion of management, necessary to present fairly the
financial position, results of operations and cash flows for the
interim period presented. All adjustments are of a normal
recurring nature. It is suggested that these interim financial
statements be read in conjunction with the Company's March 31,
2005 financial statements. Operating results from the period ended
December 31, 2005 are not necessarily indicative of the results
that can be expected for the year ending March 31, 2006.
Note 2 Continuance of Operations
-------------------------
These financial statements have been prepared using generally
accepted accounting principles in the United States of America
applicable for a going concern which assumes that the Company will
realize its assets and discharge its liabilities in the ordinary
course of business. The Company has a working capital deficiency
of $43,960 as at December 31, 2005, has not yet attained
profitable operations and the Company has accumulated losses of
$138,460 since inception. Its ability to continue as a going
concern is dependent upon the ability of the company to generate
profitable operations in the future and/or to obtain the necessary
financing to meet its obligations and repay its liabilities
arising from normal business operations when they come due. The
outcome of these matters cannot be predicted with any certainty at
this time and raise substantial doubt that the Company will be
able to continue as a going concern. Realization values may be
substantially different from carrying values as shown in these
financial statements should the Company be unable to continue as a
going concern. These financial statements do not include any
adjustments to the amounts and classification of assets and
liabilities that may be necessary should the Company be unable to
continue as a going concern. The Company anticipates that
additional funding will be in the form of equity financing from
the sale of common shares. The Company may also seek to obtain
additional short-term loans from the directors of the Company.
There are no current arrangements in place for equity funding or
short-term loans.
Note 3 Commitments
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Mining Lease
By a lease agreement effective May 15, 2001 and amended April
2002, November 2002, April 2003, January 9, 2004 and April 11,
2005, the Company was granted the exclusive right to explore and
mine the SF resource property located in Storey County of the
State of Nevada. The term of this lease is for 20 years, renewable
for an additional 20 years so long as the conditions of the lease
are met. Minimum payments and performance commitments are as
follows:
<page>
Tari Inc.
(A Pre-exploration Stage Company)
Notes to the Financial Statements
December 31, 2005
(Stated in US Dollars) - Page 2
--------------------
Note 3 Commitment - (cont'd)
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Minimum Advance Royalty Payments:
The owner shall be paid a royalty of 4% of the net smelter returns
from all production. In respect to this royalty, the company is
required to pay minimum advance royalty payments of the following:
- $5,000 upon execution (paid);
- $1,250 on or before May 15, 2002 (paid);
- $1,500 on or before November 30, 2002 (paid);
- $1,500 on or before April 15, 2003 (paid);
- $2,000 on January 9, 2004 (paid);
- $5,000 on or before July 9, 2004 (paid);
- $5,000 on or before April 12, 2005 (paid); and
- $50,000 each January 9 thereafter until termination of the
lease, adjusted based on inflation rates designated by the
Consumer Price Index.
In addition, the Company is required to fund exploration
expenditures of $5,000 by April 12, 2005 (paid).
The advance royalty payment of $50,000 due January 9, 2005 has not
been made. The Company is currently negotiating an amendment to
the balance of the advance royalty payments due. As per the lease
agreement, the landlord must give written default notice to the
Company and the Company then has 15 days to cure the default or
the lease can be terminated. No notice has been received due to
current negotiations.
The Company can reduce the net smelter return royalty to 0.5% by
payment of a buy-out price of $5,000,000. Advance royalty payments
made to the date of the buy-out will be applied to reduce the
buy-out price.
Performance Commitment:
In the event that the Company terminates the lease after June 1,
of any year it is required to pay all federal and state mining
claim maintenance fees for the next assessment year. The Company
is required to perform reclamation work in the property as
required by federal state and local law for disturbances resulting
from the Company's activities on the property.
<page>
Tari Inc.
(A Pre-exploration Stage Company)
Notes to the Financial Statements
December 31, 2005
(Stated in US Dollars) - Page 3
--------------------
Note 4 Related Party Transactions
--------------------------
The Company was charged the following by a director of the
Company:
<table>
<caption>
May 2, 2001
(Date of
Three months ended Nine months ended Inception)
December 31, December 31, to December 31,
2005 2004 2005 2004 2005
---- ---- ---- ---- ----
<s> <c> <c> <c> <c> <c>
Management fees $ 1,500 $ 1,500 $ 4,500 $ 3,000 $ 9,000
============ ============= ============ ============ ================
</table>
These charges were measured by the exchange amount which is the
amount agreed upon by the transacting parties.
Included in accounts payable at December 31, 2005 is $9,000 (March
31, 2005: $4,500) consisting of unpaid management fees due to a
director of the Company.
The amount due to related party, a director of the Company,
consist of unpaid advances. The amount due is unsecured,
non-interest bearing and has no specific terms for repayment.
<page>
Item 2. Management's Discussion and Analysis or Plan of Operation
Forward Looking Statements
This quarterly report contains forward-looking statements that involve risks and
uncertainties. We use words such as anticipate, believe, plan, expect, future,
intend and similar expressions to identify such forward-looking statements. You
should not place too much reliance on these forward-looking statements. Our
actual results are likely to differ materially from those anticipated in these
forward-looking statements for many reasons, including the risks faced by us
described in this Risk Factors section and elsewhere in this quarterly report.
Plan of Operation
Our plan of operation for the twelve months following the date of this report is
to complete the recommended phase one exploration program on the SF project in
which we hold a leasehold interest. We anticipate that this program will cost us
$89,000.
On April 11, 2005, the SF Property lease agreement dated May 15, 2001 was
further amended with respect to the Schedule of Minimum Payments. With the
amendment, the Company, instead of paying the advance royalty of $10,000 by
January 9, 2005, shall pay $5,000 by April 12, 2005, and fund exploration
expenditures on the SF Property of $5,000 by April 12, 2005. Both payments were
made on April 12, 2005. In order to keep the lease in good standing, we must pay
the lessor $50,000 by January 9 every year thereafter.
The advance royalty payment of $50,000 due by January 9, 2005 was not paid. The
Company is currently negotiating an amendment to the terms of the advance
royalty payments due. As per the lease agreement, the landlord must give written
default notice to the Company and the Company then has 15 days to cure the
default or the lease can be terminated. No notice has been received due to
current negotiations.
In addition, we anticipate spending $12,500 on professional fees and $14,000 on
administrative expenses.
Total expenditures over the next 12 months are therefore expected to be
$165,500. Our cash on hand at December 31, 2005 was $614. Accordingly, we will
need to raise additional funds in order to complete the recommended exploration
program on the SF project and meet our other expected expenses. We do not
currently have any arrangements for raising additional funding.
Results of Operations for the third quarter ended December 31, 2005
We incurred a net loss of $29,018 for the nine months period ended December 31,
2005, as compared to a loss of $17,347 in the same period in 2004. The
difference in net loss was primarily due to an increase in audit and accounting
fees, management fees, office expenses, and resource property costs. As per
management agreement dated July 1, 2004, the president started to charge the
Company $500 per month for management fees ($4,500 for the period April -
December, 2005). The Company also started to incur $400 per month for office
rent, telephone expenses, and general miscellaneous office expenses ($3,000 per
the period April - December, 2005) related to use of the Vancouver office. In
the previous periods, the president did not charge the Company for such
expenses. During the nine months ended December 31, 2005, we incurred transfer
agent and filing fees of $1,181 (2004: $2,272) and professional fees of $9,359
<page>
(2004: $4,224) in order to bring all outstanding SEC filings current. We also
incurred resource property costs of $10,217 (2004: $5,271) due to the new
amended lease agreement. At the end of the third quarter, we had cash on hand of
$614. Our liabilities for the same period totalled $44,574 and consisted of
accounts payable of $25,252 and $19,322 due to our president.
Item 3. Controls and Procedures
As required by Rule 13a-15 under the Exchange Act, within the 90 days prior to
the filing date of this report, the Company carried out an evaluation of the
effectiveness of the design and operation of the Company's disclosure controls
and procedures. This evaluation was carried out under the supervision and with
the participation of the Company's management, including the Company's
President, the Chief Executive Officer, and the Chief Financial Officer.
Based upon that evaluation, the Company concluded that the disclosure controls
and procedures are effective. There have been no significant changes in the
Company's internal controls or in other factors, which could significantly
affect internal controls subsequent to the date the Company carried out its
evaluation.
PART II OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not a party to any pending legal proceeding. Management is not
aware of any threatened litigation, claims or assessments.
Item 2. Changes in Securities
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
<page>
Item 6. Exhibits and Report on Form 8-K
31.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
There were no reports filed on Form 8-K during the six months period ended
September 30, 2005.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Tari Inc.
/s/ Theodore Tsagkaris
- ---------------------------
Theodore Tsagkaris
President, Secretary, Treasurer
Chief Executive Officer and Director
(Principal Executive Officer,
Principal Financial Officer and
Principal Accounting Officer)
Dated: March 13, 2007