ClickStream Corp - Quarter Report: 2011 May (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.   20549

FORM 10-Q

 (Mark One)

For the quarterly period ended

May 31, 2011

For the transition period from

  to  

Commission file number     000-52944

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 x Yes         ¨  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” 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).

x Yes         ¨  No

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date.

Class	Outstanding at April 7, 2011
common stock - $0.001 par value	59,686,200

PART I - FINANCIAL INFORMATION

Item 1.

Financial Statements.

Our unaudited financial statements included in this Form 10-Q are as follows:

F-1

Unaudited Balance Sheets as of May 31, 2011 and August 31, 2010.

F-2

Unaudited Statements of Operations for the three and nine months ended May 31, 2011 and 2010 and from inception on September 30, 2005 to May 31, 2011

.

F-3

Unaudited Statements of Cash Flows for the three and nine months ended May 31, 2011 and 2010 and from inception on September 30, 2005 to May 31, 2011.

F-4

Notes to Unaudited Financial Statements.

These unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the SEC instructions to Form 10-Q.  In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature.  Operating results for the interim period ended May 31, 2011 are not necessarily indicative of the results that can be expected for the full year Item 1.

1

Mine Clearing Corp.

(A Development Stage Company)

Balance Sheets

(Unaudited)

The accompanying notes are an integral part of these Financial Statements

F-1

Mine Clearing Corp.

(A Development Stage Company)

Statements of Operations

(Unaudited)

The accompanying notes are an integral part of these Financial Statements

F-2

Mine Clearing Corp.

(A Development Stage Company)

Statements of Cash Flows

(Unaudited)

The accompanying notes are an integral part of these Financial Statements

F-3

Mine Clearing Corp.

(A Development Stage Company)

Notes to the Financial Statements

May 31, 2011

(Unaudited)

1.     Development Stage Company

Peak Resources Incorporated (the “Company”) was incorporated in the State of Nevada on September 30, 2005. On August 18, 2008, the Company changed its name to Mine Clearing Corp. The Company is a Development Stage Company, as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 915, Development Stage Entities. The Company’s former principal business was the acquisition and exploration of mineral resource properties. During the fourth quarter of 2008, the Company changed its principal business and entered into licensing agreements for the rights to certain intellectual properties in the landmine scanning, detection, mapping and removal services.

2.

Going Concern

These financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has never generated revenues since inception and has never paid any dividends and is unlikely to pay dividends or generate earnings in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations. As at May 31, 2011, the Company has accumulated losses of $760,240 since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

3.

Summary of Significant Accounting Policies

a)

Basis of Presentation

These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. The Company’s fiscal year-end is August 31.

b)

Interim Financial Statements

These interim unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended August 31, 2010, included in the Company’s Annual Report on Form 10K-A filed December 14, 2010 with the SEC.

The financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the Company’s financial position at May 31, 2011, and the results of its operations and cash flows for the three and nine month periods ended May 31, 2011 and 2010. The results of operations for the period ended May 31, 2011, are not necessarily indicative of the results to be expected for future quarters or the full year.

F-4

Mine Clearing Corp.

(A Development Stage Company)

Notes to the Financial Statements

May 31, 2011

(Unaudited)

3.

Summary of Significant Accounting Policies (continued)

c)

Use of Estimates

The preparation of financial statements in conformity with US generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to long-lived assets, donated services and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

d)

Basic and Diluted Net Income (Loss) Per Share

The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

e)

Comprehensive Loss

ASC 220, Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at May 31, 2011 and 2010, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.

f)

Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.

g)

Research and Development Costs

Pursuant to ASC 730, Research and Development, the Company expenses all research and development costs as incurred.

h)

Property and Equipment

Property and equipment is recorded at cost and is amortized on a straight-line basis over 5 years.

F-5

Mine Clearing Corp.

(A Development Stage Company)

Notes to the Financial Statements

May 31, 2011

(Unaudited)

3.

Summary of Significant Accounting Policies (continued)

i)

Long-Lived Assets

In accordance with ASC 360, Property Plant and Equipment, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life.

Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.

j)

Financial Instruments

The Company’s financial instruments consist principally of cash, accounts payable, accrued liabilities, and amounts owed to related parties. Pursuant to ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments the fair value of the Company’s cash equivalents is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.

The Company’s operations are in Canada and the United States, which results in exposure to market risks from changes in foreign currency rates. The financial risk is the risk to the Company’s operations that arise from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk.

k)

Income Taxes

The Company has adopted ASC 740, Income Taxes as of its inception. Pursuant to ASC 740 the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.

l)

Foreign Currency Translation

The Company’s functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated in accordance with ASC 830, Foreign Currency Translation Matters, using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian dollars. The Company has not, to the date of these financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.

F-6

Mine Clearing Corp.

(A Development Stage Company)

Notes to the Financial Statements

May 31, 2011

(Unaudited)

3.

Summary of Significant Accounting Policies (continued)

m)

Recently Issued Accounting Pronouncements

In October 2009, FASB issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminated the use of the residual method for allocating arrangement considerations and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect the timing or amount of revenue recognition. This standard became effective on January 1, 2011. The Company’s adoption of this standard did not have a material effect on the Company’s financial statements.

In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the product’s essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard became effective on January 1, 2011. The Company’s adoption of this standard did not have a material effect on the Company’s financial statements.

In March 2010, the FASB issued Accounting Standards Update (“ASU”) No. 2010-11, Derivatives and Hedging (Topic 815): Scope Exception Related to Embedded Credit Derivatives. The amendments in this ASU are effective for each reporting entity at the beginning of its first fiscal quarter beginning after June 15, 2010.  Early adoption is permitted at the beginning of each entity’s first fiscal quarter beginning after issuance of this ASU.  The Company’s adoption of provisions of ASU 2010-11 did not have a material effect on the Company’s financial statements.

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

4.

Property and Equipment

			May 31,	August 31,
			2011	2010
	Cost	Accumulated Amortization	Net Book Value	Net Book Value
	$	$	$	$
Equipment	1,232	698	534	718

F-7

Mine Clearing Corp.

(A Development Stage Company)

Notes to the Financial Statements

May 31, 2011

(Unaudited)

5.

Related Party Transactions

a)

During the nine month period ended May 31, 2011, the Company recognized a total of $4,500 (2010 - $2,750) for rent at $500 per month (2010 - $250 per month) provided by the President of the Company.

b)

At May 31, 2011, the Company is indebted to a director of the Company for $152,468 (August 31, 2010 - $102,461), representing expenditures paid on behalf of the Company, for office rent and management services. This amount is unsecured, non-interest bearing, due on demand and has no specific terms of repayment. During the nine month period ended May 31, 2011, imputed interest of $4,835 (2010 - $2,520) was calculated and has been recorded as additional paid-in capital.

c)

On June 11, 2009, the Company signed a loan agreement to receive $6,570 from a shareholder of the Company to be used for general working capital.  The loan is unsecured and non-interest bearing for a term of three years.  During the nine month period ended May 31, 2011, imputed interest of $246 (2010 – $246) has been accrued.

d)

At May 31, 2011, the Company is indebted to shareholders of the Company for $42,675 (August 31, 2010 - $45,095), representing loans to be used for general working capital. The loans are unsecured, non-interest bearing and have a term of three years. At May 31, 2011, the Company has accrued imputed interest of $3,574 (August 31, 2010 - $2,052). Refer to Note 7.

6.

Commitments

a)

On August 1, 2008, the Company entered into a management agreement with the President of the Company to provide management services. Under the terms of the agreement, the Company agreed to pay $5,000 per month for an initial term of 24 months. On October 22, 2010, the Company entered into a new management agreement with the President of the Company. Under the terms of the agreement, the Company agreed to pay $5,000 per month effective July 31, 2010 and expiring on October 23, 2013. The Company also agreed to reimburse the President of the Company for office expenses, including rent at $500 per month effective from July 31, 2010 with a minimum one year lease beginning on October 22, 2010.

b)

On August 15, 2008, the Company entered into a management agreement with a contractor to provide management services. Under the terms of the agreement, the Company agreed to pay $2,500 per month for an initial term of 24 months.  During the year ended August 31, 2010, both parties agreed to waive the management fees that would have been recorded for the period from September 2009 to May 2011.

c)

On November 18, 2008, the Company entered into a management agreement with a consultant to provide management services.  Under the terms of the agreement, the Company agreed to pay $2,500 per month for an initial term of 24 months.  During the year ended August 31, 2010, both parties agreed to waive the management fees that would have been recorded for the period from September 2009 to May 2011.

F-8

Mine Clearing Corp.

(A Development Stage Company)

Notes to the Financial Statements

May 31, 2011

(Unaudited)

7.

Shareholder Loan Payable

On December 15, 2008, the Company signed a loan agreement to receive $18,000 from a shareholder of the Company to be used for general working capital.  The loan agreement was amended on May 1, 2009, to increase the term of the loan from one year to three years. On November 24, 2009, the Company signed an additional loan agreement to receive an additional $4,000 to be used for general working capital.  On February 28, 2010, the Company signed an additional loan agreement to receive an additional $3,000 to be used for general working capital.  On April 10, 2010, the Company signed an additional loan agreement to receive an additional $7,800 to be used for general working capital. On June 22, 2010, the Company signed an additional loan agreement to receive an additional $5,725 to be used for general working capital.  On December 10, 2010, the Company signed an additional loan agreement to receive an additional $2,650 to be used for general working capital.  On January 7, 2011, the Company signed an additional loan agreement to receive an additional $1,500 to be used for general working capital.  The loans are unsecured, non-interest bearing and have a term of three years.  During the nine month period ended May 31, 2011, imputed interest of $1,523 (2010 – $538) has been accrued.

8.   On May 27, 2011, Mr. Larry Olson, the Company’s former President, Chief Executive Officer, Secretary, Treasurer and director, transferred 23,400,000 restricted shares of the Company’s common stock to the Ralph W. Kettel II SEPIRA in a private transaction.  The Ralph W. Kettell II SEPIRA purchased the shares from its own funds in the amount of $60,000.00, and now owns 39.20% of the issued and outstanding shares of the Company. A new Chief Executive Officer has been appointed on an interim basis.

F-9

Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operation.

THE FOLLOWING PRESENTATION OF MANAGEMENT’S DISCUSSION AND ANALYSIS OF MINE CLEARING CORP. SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION INCLUDED HEREIN.

Forward-Looking Statements

Some of the information in this quarterly report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Private Securities Litigation Reform Act of 1995.  All statements other than statements of historical facts included in this report, including, without limitation, statements regarding our future financial position, business strategy, budgets, projected costs and plans and objectives for future operations, are forward-looking statements.  These statements express, or are based on, our expectations about future events.  Forward-looking statements give our current expectations or forecasts of future events.  Forward-looking statements generally can be identified by the use of forward looking terminology such as “may,” “will,” “expect,” “intend,” “project,” “estimate,” “anticipate,” “believe” or “continue” or the negative thereof or similar terminology.

Although any forward-looking statements contained in this Form 10-Q or otherwise expressed by or on behalf of us are, to our knowledge and judgment, believed to be reasonable, there can be no assurances that any of these expectations will prove correct or that any of the actions that are planned will be taken.  Forward-looking statements involve and can be affected by inaccurate assumptions or by known and unknown risks and uncertainties which may cause our actual performance and financial results in future periods to differ materially from any projection, estimate or forecasted result. Important factors that could cause actual results to differ materially from expected results include those discussed under the caption “Risk Factors” in our annual report on Form 10-K for the year ended August 31, 2008 and filed on December 2, 2008.  Any of these factors could cause our actual results to differ materially from the results implied by these or any other forward-looking statements made by us or on our behalf.  We cannot assure you that our future results will meet our expectations.  When you consider these forward-looking statements, you should keep in mind these factors.  All subsequent written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these factors.  Our forward-looking statements speak only as of the date made.  We assume no duty to update or revise its forward-looking statements based on changes in internal estimates or expectations or otherwise.

Overview

MCC has no current business activity that generates revenue, profits or cash flow.  Due to the experience gained from its attempt to develop a mine clearing business, MCC has been monitoring the potential to enter into the mine detection business. However, given our limited resources we have not been able to identify a suitable technology to develop.  We will also be reviewing other business opportunities and industries that management is familiar with and can assess with confidence.  Management has experience in a number of businesses including technology, tourism and oil and gas. Subsequent to quarter end there occurred a change in management. The new management will evaluate mine clearing business for potential technology to acquire and review the Company’s history and data to determine whether it should exit from consideration of entering this field in the short or long term. The new management has experience in mining, international business, technology sectors and pharmaceutical industries.

Accordingly, since it is our goal to create value in MCC and for its shareholders, we are considering diversifying into other businesses.   To that extent we signed a letter of intent on July 26, 2010 to enter into a property, management and financing agreement (“LOI”) with Boulder Hill Mines, Inc. (“Boulder”) on or before September 1, 2010. The LOI was never affected during the time period agreed to. However, MCCO has continued looking at the mining sector as a potential area for entry. Subsequent to quarter end the company retained a professional engineer to look at the mining, agro-energy and agricultural

2

sectors for future business opportunities. The Company will be looking at both North and South America as potential geographic locations. There is no assurance the company will determine suitable business opportunities or that if it does it has sufficient capital to enter into what it would consider favorable terms.

Plan of Operation

Mine Clearing Corp. is committed to finding a viable business to acquire or develop.  It will continue to monitor for opportunities in the mine detection area but will also review opportunities in other sectors. We previously reported MCC’s plan of operations is to complete a number of key objectives over the course of the next 12 months. These are as follows:

·Identify new business opportunities to conduct due diligence.

·Enter into an acquisition, letter of intent or other business arrangement to develop the chosen business.

·Add to the management team in order to develop the business.

·Complete a financing of for initial operations.

To effect this plan management estimates up to $100,000 will be required both to maintain the Company’s current level of activity, as well as to conduct sufficient due diligence efforts. Should the company be unable to raise this capital, it will not be able to implement this plan, or to implement the plan as effectively as it would like. The Company intends to investigate sectors where it believes there are favorable long-term economic trends, and that management has the expertise and experience in, or that suitable consultants are found to advise management. There is no assurance such consultants may be found, or if found the company can offer suitable compensation arrangements.

The Company previously reported projected milestones of identifying business opportunities, entering into a business arrangement, appointing new management and completing a financing, all projected between May and August 2011.

The Company has appointed, subsequent to quarter end, new management, and is looking both at whether it will continue monitoring the mine clearing business, or enter new fields such as mineral resources or international business that management has experience in.

In June 2011 the Company, subsequent to quarter end, appointed a new CEO and CFO, as well as a new board of directors. The company’s previously reported development milestones will therefore be delayed as new management becomes familiar with the Company. The new management has specific experience in the mining sector, and business in Latin America, and is actively reviewing potential business opportunities, including the mine clearing sector.

Risk Factors

An investment in MCC’s common stock involves a number of very significant risks.  Prospective investors should refer to all the risk factors disclosed in MCC’s Form 10-K filed on December 14, 2010.

Results of Operation for the Period Ended February 28, 2011

MCC has had no operating revenues since its inception on September 30, 2005, through to May 31, 2011.  MCC’s activities have been financed from the proceeds of share subscriptions and from shareholder loans.  From MCC’s inception on September 30, 2005 to May 31, 2011 MCC raised a total of approximately $412,350 from private placements of its common stock and $142,299 from shareholder loans.

For the period from inception on September 30, 2005, to May 31, 2011, MCC incurred total expenses of $760,240. These expenses included $190,825 in professional fees, $98,000 in research and development

3

costs, $435,941 in general and administrative expenses, $699 in amortization expenses and $20,597 in expenses due to discontinued operations (mineral property costs).  MCC’s general and administrative expenses include donated management services, donated rent, office maintenance, bank charges, travel, communication expenses, courier, postage costs, and office supplies.  MCC’s professional fees consist of legal, consulting, management fees, accounting and auditing fees.  

For the nine month period ended May 31, 2011, MCC incurred total expenses of $74,915.  These expenses included $11,665 in professional fees, $185 in amortization, $6,604 in interest, and $56,461 in general and administrative expenses.  MCC’s general and administrative expenses mainly include donated management services, donated rent, office maintenance, bank charges, travel, communication expenses, courier, postage costs, and office supplies.  MCC’s professional fees consist of management fees, accounting and auditing fees.  

For the nine month period ended May 31, 2010, MCC incurred total expenses of $70,385.  These expenses included $13,068 in professional fees, $185 in amortization, $3,719 in interest, and $53,413 in general and administrative expenses. Mine Clearing’s general and administrative expenses included $1,500 for donated rent, which were provided by its President.

For the three month period ending May 31, 2011 the Company incurred losses of 23,968 compared to a loss of $18,999 for the period ending May 31, 2010.

Liquidity and Capital Resources

As at May 31, 2011, MCC had a cash balance of $74 and had working capital deficit of ($277,474).  MCC’s accumulated deficit was $760,240 as at May 31, 2011.  MCC’s net loss of $760,240 from September 30, 2005 (date of inception) to May 31, 2011 was mostly funded by its equity financing.  From September 30, 2005 (date of inception) to May 31, 2011, MCC raised $412,350 in equity financing and $161,653 in debt financing.  The net increase in cash from September 30, 2005 (date of inception) to May 31, 2011 was $74.

On August 7, 2008, MCC entered into a Development and Consultancy Support Services Agreement (“Services Agreement”) with Roke Manor Research Limited (the “Licensor”) to develop proprietary technology and products and provide consulting support in the field of landmine scanning, detection, mapping and removal. This agreement was terminated on July 29, 2010.

Subsequent to quarter end the Company signed an agreement with the former CEO that he would write off any liabilities the Company owed to him as of May 31, 2011, this balance was $152,468.

On August 7, 2008, MCC entered into a Technology Exploitation Agreement with the Licensor to acquire a non-transferable license to utilize certain sensor intellectual property (“Cold Sky technology”) to develop, manufacture, use and sell any anomaly or metal detector product or products developed by MCC using the Cold Sky technology. This agreement was terminated on December 2, 2009.  

On August 7, 2008, MCC entered into a Technology Exploitation Agreement with the Licensor to acquire a non-transferable license to utilize certain sensor intellectual property (“Fig8 technology”) in order to develop, manufacture, use and sell any anomaly or metal detector product or products developed by MCC using the Fig8 technology. This agreement was terminated on December 2, 2009.  

There are no remaining funding obligations from the agreements with Roke Manor Research.

Management hopes to raise the balance of MCC’s cash requirements of $200,000 for the next 12 months from private placements, shareholder loans or possibly a registered public offering (either self-underwritten or through a broker-dealer) within the next few months.  If MCC is unsuccessful in raising enough money through future capital raising efforts, MCC may review other financing possibilities such as bank loans.  At this time MCC does not have any commitments from any broker-dealer to provide MCC with financing.

4

Net Cash Used in Operating Activities

For the nine month period ended May 31, 2011, net cash used in operating activities totaled $65,373 compared to $16,867 for the previous fiscal period.  

As at May 31, 2011, MCC had a cash balance of $74 and had working capital deficit of ($277,474. During the nine month period ended May 31, 2011, MCC used $65,373 in cash for operating activities compared to $16,867 in the prior period.  This was primarily a result of an operating loss of $74,915, $4,835 of imputed interest, offset by non-cash items for amortization of $185, and a net decrease in accounts payable and accrued liabilities of $4,522.  During the nine month period ended May 31, 2011, MCC paid $4,522 towards accounts payable compared to $47,150 in the prior period.  There were no changes in prepaid expenses and due to related parties resulting in a net use of cash of $nil.

Net Cash Used in Investing Activities

Net cash provided by investing activities was $nil for the nine month period ended May 31, 2011 as compared with $nil of cash used for the previous period.

MCC used net cash of $nil in investing activities during the nine month period ended May 31, 2011.  

For the nine month period ended May 31, 2011, MCC’s monthly cash requirement was approximately $7,264 in operating activities and approximately $nil in investing activities.  Management anticipates that after May 2011 if MCC intends to execute its business plan its monthly expenses will increase to approximately 15,000.

Net Cash Used in Financing Activities

Net cash provided by financing activities was $53,037 for the nine month period ended May 31, 2011, which included borrowings of $60,975 from a shareholder and offset by principal payments of $7,938 on shareholder loans.  Net cash provided by financing activities was $12,225 for the nine month period ended May 31, 2010, which included borrowings from a shareholder.

Off-balance Sheet Arrangements

MCC has no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Tabular Disclosure of Contractual Obligations

MCC is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

Forward Looking Statements

The information in this quarterly report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  These forward-looking statements involve risks and uncertainties, including statements regarding MCC’s capital needs, business strategy and expectations. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements.  In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue”, the negative of such terms or other comparable terminology.  Actual events or results may differ materially.  In evaluating these statements, you should consider various factors, including the risks outlined from time to time, in other reports MCC files with the Securities and Exchange Commission.  These factors may cause MCC’s actual results to

5

differ materially from any forward-looking statement.  MCC disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements.  The information constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

The Company is a small business Issuer and is not subject to interest rate or foreign currency risks.  Furthermore does not invest in interest rate swaps or any derivative products.

Item 4.  Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

 

We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act (defined below)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

 Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Accordingly, management believes that the financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented.

Changes in Internal Controls over Financial Reporting

In addition, our management with the participation of our Principal Executive Officer and Principal Financial Officer have determined that no change in our internal control over financial reporting occurred during or subsequent to the quarter ended May 31, 2011 that has materially affected, or is (as that term is defined in Rules 13(a)-15(f) and 15(d)-15(f) of the Securities Exchange Act of 1934) reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1.  Legal Proceedings.

MCC is not a party to any legal proceedings and, to the best of MCC’s knowledge, none of MCC’s property or assets are the subject of any pending legal proceedings.

Item 1A.  Risk Factors.

MCC is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.  

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Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

During the quarter of the fiscal year covered by this report, (i) MCC did not modify the instruments defining the rights of its shareholders, (ii) no rights of any shareholders were limited or qualified by any other class of securities, and (iii) on August 30, 2010, MCC issued 240,000 shares of common stock to one non-affiliated non-U.S. company at a price of $0.05 per share for cash proceeds of $12,000.

With respect to all of the above offerings, MCC completed the offerings of the common stock pursuant to Rule 903 of Regulation S of the 1933 Act on the basis that the sale of the common stock was completed in an “offshore transaction”, as defined in Rule 902(h) of Regulation S.  MCC did not engage in any directed selling efforts, as defined in Regulation S, in the United States in connection with the sale of the shares.  Each investor represented to MCC that the investor was not a U.S. person, as defined in Regulation S, and was not acquiring the shares for the account or benefit of a U.S. person.  The subscription agreement executed between MCC and the investor included statements that the securities had not been registered pursuant to the 1933 Act and that the securities may not be offered or sold in the United States unless the securities are registered under the 1933 Act or pursuant to an exemption from the 1933 Act.  The investor agreed by execution of the subscription agreement for the common stock: (i) to resell the securities purchased only in accordance with the provisions of Regulation S, pursuant to registration under the 1933 Act or pursuant to an exemption from registration under the 1933 Act; (ii) that MCC is required to refuse to register any sale of the securities purchased unless the transfer is in accordance with the provisions of Regulation S, pursuant to registration under the 1933 Act or pursuant to an exemption from registration under the 1933 Act; and (iii) not to engage in hedging transactions with regards to the securities purchased unless in compliance with the 1933 Act.  All securities issued were endorsed with a restrictive legend confirming that the securities had been issued pursuant to Regulation S of the 1933 Act and could not be resold without registration under the 1933 Act or an applicable exemption from the registration requirements of the 1933 Act.

Each investor was given adequate access to sufficient information about MCC to make an informed investment decision.  None of the securities were sold through an underwriter and accordingly, there were no underwriting discounts or commissions involved.  No registration rights were granted to any of the investors.

On August 30, 2010, the Company issued 240,000 shares of common stock and 240,000 warrants at $0.05 per share for cash proceeds of $12,000. Each warrant is exercisable into one share of common stock at $0.20 per share until June 29, 2012. Based on the Black-Scholes and relative fair value calculations performed, the value assigned to the stock is $7,573 and the value assigned to the warrants is $4,427

Item 3.  Defaults Upon Senior Securities.

During the quarter of the fiscal year covered by this report, no material default has occurred with respect to any indebtedness of MCC.  Also, during this quarter, no material arrearage in the payment of dividends has occurred.

Item 4.  Submission of Matters to a Vote of Security Holders.

No matter was submitted to a vote of security holders through the solicitation of proxies or otherwise, during the quarter of the fiscal year covered by this report.

Item 5.  Other Information.

During the quarter of the fiscal year covered by this report, MCC reported all information that was required to be disclosed in a report on Form 10-Q.

MCC has adopted a new code of ethics that applies to all its executive officers and employees, including its CEO and CFO.  See Exhibit 14 – Code of Ethics for more information.  MCC undertakes to provide any

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person with a copy of its financial code of ethics free of charge.  Please contact Camilo Velasquez at 416-214-4273 to request a copy of MCC’s code of ethics.  Management believes MCC’s code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations; and provide accountability for adherence to the code.

On May 27, 2011, Mr. Larry Olson, the Company’s former President, Chief Executive Officer, Secretary, Treasurer and director, transferred 23,400,000 restricted shares of the Company’s common stock to the Ralph W. Kettel II SEPIRA in a private transaction.  The Ralph W. Kettell II SEPIRA purchased the shares from its own funds in the amount of $60,000.00, and now owns 39.20% of the issued and outstanding shares of the Company.

Item 6.  Exhibits

(a)

Index to and Description of Exhibits

All Exhibits required to be filed with the Form 10-Q are included in this quarterly report or incorporated by reference to MCC’s previous filings with the SEC, which can be found in their entirety at the SEC website at www.sec.gov under SEC File Number 000-52944 and SEC File Number 333-135743.

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SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, Mine Clearing Corp. has caused this report to be signed on its behalf by the undersigned duly authorized person.

MINE CLEARING CORP.

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