MALACHITE INNOVATIONS, INC. - Quarter Report: 2008 December (Form 10-Q)

legnd_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended December 31, 2008

[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ______________ to________________

Commission File Number: 333-152830

LEGEND MINING INC.
(Exact name of registrant as specified in its charter)


Nevada	75-3268988
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)


2-46 DeZhennan Rd., Suite 403, Yuesiu District, Guangzhou Guangdong Province, China	N/A
(Address of principal executive offices)	(Postal or Zip Code)


Registrant’s telephone number, including area code:	86-13268166474


________________________________________________________________
(Former name, former address and former fiscal year, if changed since last report)

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 [ ] No [X]

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]
(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 [ ]

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes [ ] No [ ]

LEGEND MINING INC.

(An Exploration Stage Company)

FINANCIAL STATEMENTS

DECEMBER 31, 2008

(Unaudited)

BALANCE SHEETS

STATEMENTS OF OPERATIONS

STATEMENTS OF STOCKHOLDERS’ EQUITY

STATEMENTS OF CASH FLOWS

NOTES TO THE FINANCIAL STATEMENTS

LEGEND MINING INC.

(An Exploration Stage Company)

Balance Sheets

Assets
	December 31,			March 31,
	2008			2008
	(unaudited)
Current Assets
Cash	$	19,277			17,467
Total Assets	$	19,277			17,467


Liabilities and Stockholders' Equity


Current Liabilities
Accounts payable and accrued liabilities	$	861			1,050
Loans from related party (Note 5)		25,000			-
Total Current Liabilities		25,861			1,050


Stockholders' Equity
Capital stock
Authorized: 75,000,000 common shares with a par value of $0.001
Issued and outstanding:
7,350,000 common shares		7,350			7,350
Additional paid-in-capital		17,650			17,650
Deficit accumulated during the exploration stage		(31,584	)		(8,583	)
Total stockholders' equity		(6,584	)		16,417
Total liabilities and stockholders' equity	$	19,277			17,467

Nature and continuance of operations (Note 1)

The Accompanying Notes are an Integral Part of These Financial Statements

LEGEND MINING INC.

(An Exploration Stage Company)

Statements of Operations (Unaudited)

	For three months ended December 31, 2008			For three months ended December 31, 2007			For nine months ended December 31, 2008			From July 1, 2007 (Inception) to December 31, 2007			From July 1, 2007 (Inception) to December 31, 2008

Bank charges and interest	$	86		$	-		$	162		$	-		$	195
Filing and transfer agent fees		-			-			-			-			-
Mineral properties		4,728			-			4,728			-			12,228
Office expenses		-			-			-			-			-
Professional fees		8,028			-			18,110			-			19,160
Loss before income taxes	$	12,842		$	-		$	23,000		$	-		$	31,583
Provision for income taxes		-			-			-			-			-
Net loss	$	12,842		$	-		$	23,000		$	-		$	31,583

Loss per share - Basic and diluted	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Weighted Average Number of Common Shares Outstanding		7,350,000			1,881,111			7,350,000			925,137			7,350,000

The Accompanying Notes are an Integral Part of These Financial Statements

LEGEND MINING INC.

(An Exploration Stage Company)

Statements of Stockholders' Equity (Unaudited)

	Number of Common Shares		Par Value		Additional Paid-in- Capital		Total Capital Stock		Deficit accumulated During the exploration stage			Total

Balance, July 1, 2007		-	$	-	$	-	$	-	$	-		$	-
November 28, 2007
Subscribed for cash at $0.001		4,500,000		4,500		-		4,500		-			4,500
December 18, 2007										-
Subscribed for cash at $0.005		1,600,000		1,600		6,400		8,000		-			8,000
January 18, 2008										-
Subscribed for cash at $0.01		1,250,000		1,250		11,250		12,500					12,500
Net loss										(8,583	)		(8,583	)
Balance, March 31, 2008		7,350,000	$	7,350	$	17,650	$	25,000	$	(8,583	)	$	16,417
Net loss										(23,000	)		(23,000	)
Balance, December 31, 2008		7,350,000	$	7,350	$	17,650	$	25,000	$	(31,583	)	$	(6,583	)

The Accompanying Notes are an Integral Part of These Financial Statements

LEGEND MINING INC.

(An Exploration Stage Company)

Statements of Cash Flows (Unaudited)

	For three months ended December 31, 2008			For three months ended December 31, 2007		For nine months ended December 31, 2008			From July 1, 2007 (Inception) to December 31, 2007		From July 1, 2007 (Inception) to December 31, 2008

Operating activities
Net loss	$	(12,842	)	$	-	$	(23,000	)	$	-	$	(31,583	)
Adjustments to reconcile net loss to net cash
Accounts payable and accrued liabilities		28			-		(190	)		-		860
Net cash used in operations		(12,814	)		-		(23,190	)		-		(30,723	)

Financing activities
Loans from related party		25,000					25,000					25,000
Shares subscribed for cash										12,500		25,000
Net cash provided by financing activities		25,000					25,000			12,500		50,000

Net increase (decrease) in cash		12,186			-		1,810			12,500		19,277

Cash beginning		7,091			-		17,467			-		-
Cash (overdraft) ending	$	19,277		$	-	$	19,277		$	12,500	$	19,277

Supplemental cash flow information:

Cash paid for:
Interest		-								-		-
Taxes		-								-		-

The Accompanying Notes are an Integral Part of These Financial Statements

LEGEND MINING INC.

(An Exploration Stage Company)

Notes To The Financial Statements (Unaudited)

December 31, 2008

1. BASIS OF PRESENTATION AND GOING CONCERN UNCERTAINTY

The unaudited financial statements have been prepared by Legend Mining Inc. (the “Company”), pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such SEC rules and regulations; nevertheless, the Company believes that the disclosures are adequate to make the information presented not misleading. These financial statements and the notes hereto should be read in conjunction with the financial statements and notes thereto included in the Company's Form S-1 for the period from July 1, 2007 (inception) to March 31, 2008, which was filed September 5, 2008. In the opinion of the Company, all adjustments, including normal recurring adjustments necessary to present fairly the financial position of Legend Mining Inc. as of December 31, 2008 and the results of its operations and cash flows for the three months and six months then ended, have been included. The results of operations for the interim period are not necessarily indicative of the results for the full year.

The Company was incorporated in Nevada on July 1, 2007. The Company is in the exploration stage of its resource business. During the period from July 1, 2007 (inception) to December 31, 2008, the Company commenced operations by issuing shares and obtaining loans and acquiring a mineral property located in the Province of Saskatchewan, Canada. The Company has not yet determined whether this property contains reserves that are economically recoverable. The recoverability of costs incurred for acquisition and exploration of the property will be dependent upon the discovery of economically recoverable reserves, confirmation of the Company's interest in the underlying property, the ability of the Company to obtain necessary financing to satisfy the expenditure requirements under the property agreement and to complete the development of the property and upon future profitable production or proceeds for the sale thereof.

These financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred losses since inception resulting in an accumulated deficit of $31,583 as at December 31, 2008 and further losses are anticipated in the development of its business raising substantial doubt about the Company's ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating 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. Management intends to finance operating costs over the next twelve months with existing cash on hand and loans from directors and or private placement of common stock.

In light of the Company’s current financial position and the uncertainty of raising sufficient capital to achieve its business plan, there is substantial doubt about the Company’s ability to continue as a going concern.

There have been no changes in accounting policies used by the Company during the quarter ended December 31, 2008.

2. MINERAL INTERESTS

On January 28, 2008, the Company entered into a mineral property option Agreement. The Company was granted the sole and exclusive right to acquire up to a 100% undivided interest in mineral claim located in the Township 52, Range 15, W2M, Sections 4 and 9, in the Province of Saskatchewan, with tenure number S-14260. The Company shall pay $7,500 on the Agreement date (paid), shall pay $15,000 on or before September 30, 2008 (subsequently amended to March 31, 2009 (See Note 6)), and $25,000 on or before the second anniversary of this Agreement, shall pay $205,000 on or before the third anniversary of this Agreement, and shall incur $50,000 in Expenditures on the Property by September 30, 2008 (subsequently amended to June 30, 2009 (See Note 6)) and $150,000 by September 30, 2009, for a total of $200,000.

The mineral interest is held in trust for the Company by the vendor of the property. Upon request from the Company the title will be recorded in the name of the Company with the appropriate mining recorder.

LEGEND MINING INC.

(An Exploration Stage Company)

Notes To The Financial Statements (Unaudited)

December 31, 2008

3. COMMON STOCK

The total number of common shares authorized that may be issued by the Company is 75,000,000 shares with a par value of one tenth of one cent ($0.001) per share and no other class of shares is authorized.

During the period from July 1, 2007 (inception) to March 31, 2008, the Company issued 7,350,000 shares of common stock for total cash proceeds of $25,000. No share was issued for the three months ended May 31, 208. At December 31, 2008 there were no outstanding stock options or warrants.

4. INCOME TAXES

As of December 31, 2008, the Company had net operating loss carry forwards of approximately $31,583 that may be available to reduce future years' taxable income through 2028. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.

5. LOAN FROM RELATED PARTY

On December 23, 2008, a related party of the Company granted a loan to the Company. The loan is interest bearing at 6% per annum and payable upon demand.

Forward-Looking Statements

This Form 10-Q includes "forward-looking statements" within the meaning of the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.

All statements other than historical facts included in this Form, including without limitation, statements under "Plan of Operation", regarding our financial position, business strategy, and plans and objectives of management for the future operations, are forward-looking statements.

Although we believe that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Important factors that could cause actual results to differ materially from our expectations include, but are not limited to, market conditions, competition and the ability to successfully complete financing.

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

On January 28, 2008, we entered into an agreement, with Carman Wilcox of Imperial, Saskatchewan, wherein he granted us the sole and exclusive option to acquire a 100% interest in the Carman Wilcox property, which is located in Sections 4 and 9 of Township 52 and Range 15W2M, Saskatchewan. This agreement was subsequently amended on August 20, 2008. We purchased this Option from Mr. Wilcox for a cash payment of $7,500. In order to exercise this option and acquire these claims we need to pay Mr. Carman Wilcox further cash payments totaling $245,000 as follows;

1. $15,000 on or before March 31, 2009, provided however, Mr. Wilcox may at any time after October 31, 2008, on 48 hours notice, require said payment to be made forthwith;

2. $25,000 on or before January 28, 2009; and

3. $205,000 on or before January 28, 2010.

and incur $200,000 in exploration expenditures as follows:

1. $50,000 on or before June 30, 2009; and

2. $150,000 on or before September 30, 2009.

If we fail to make the additional payments above-noted, or if we fail to make the required exploration expenditures, our option to acquire the 100% interest in the property will terminate and we will not own any interest in the property.

Mr. Wilcox holds title to the Carman Wilcox claims. Our option agreement with him requires that he transfer the claims to us if we successfully exercise the option. Mr. Wilcox is at arm’s length to us and has no relationship to us other than as the owner of the Carman Wilcox property.

We have obtained a geological report on the Carman Wilcox property that was prepared by George C. Sharpe. Mr. Sharpe is a graduate of the Geological Technology Program at the Sault College of Arts and Technology, Faculty of Science, Sualt Ste Marie, Ontario, Canada. The geological report summarizes details concerning the Carman Wilcox property and makes a recommendation for further exploration work.

Based on the information available to Mr. Sharpe, and communication with others experienced in exploring this area, in the opinion of Mr. Sharpe there does not appear to be any obvious kimberlite targets on or immediately adjacent to the two claim blocks, however he opines that the proximity of the large crustal suture that hosts numerous known kimberlites may be of significant potential. The potential of these claims is mainly related to the prolific number of kimberlites in nearby areas and the lack of detailed prior exploration on these claims. The area directly underneath the claims is an elongated oval shaped magnetic low that may also be of some interest.

Based on his review of geological information relating to the Carman Wilcox property, Mr. Sharpe recommends an initial exploration program on the property consisting of a sampling program from the stream beds for any heavy mineral concentrations to test for gold and kimberlitic indicator metals. The following is a proposed budget for this Phase I work:

ITEM	COST	UNITS	TOTAL
Geologist on site	$500 per day	4 days	$2,000.00
Transportation	$300 per trip	1 round trip	$300.00
Field supplies	$200	1	$200.00
Backhoe and operator	$1,000 per day	1 day	$1,000.00
Meals and lodging	$150 per person for 2 days	2 people	$300.00
Stationary	$100	1	$100.00
Total			$3900.00
GST			$190.00
Contingencies	Add 15%		$600.00
		GRAND TOTAL	APPROX $5000.00

Our plan of operation is to conduct exploration work on the Carman Wilcox property in order to ascertain whether it possesses economic quantities of kimberlite or gold. There can be no assurance that economic mineral deposits or reserves exist on the Carman Wilcox property until appropriate exploration work is done and an economic evaluation based on such work concludes that production of minerals from the property is economically feasible.

Mineral property exploration is typically conducted in phases. Each subsequent phase of exploration work is recommended by a geologist based on the results from the most recent phase of exploration.

Work on the Phase 1 initial exploration program is currently underway. Once we complete each phase of exploration, we will make a decision as to whether or not we proceed with each successive phase based upon the analysis of the results of that program. Our director will make this decision based upon the recommendations of the independent geologist who oversees the program and records the results.

Even if we complete the currently recommended exploration programs on the Carman Wilcox property and they are successful, we will need to spend substantial additional funds on further drilling and engineering studies before we will ever know if there is a commercially viable mineral deposit, a reserve, on the property.

The Carman Wilcox property is without known reserves. Our proposed programs are exploratory in nature.

In the next 12 months, we also anticipate spending the following over the next 12 months on administrative fees:

* $2,000 on legal fees

* $8,500 on accounting and audit fees

* $500 on EDGAR filing fees

* $1,000 on general administration costs

Total expenditures over the next 12 months are therefore expected to be at least $17, 000.

Our cash reserves are not sufficient to meet our obligations for the next twelve-month period. As a result, we will need to seek additional funding in the near future. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We may also seek to obtain short-term loans from our directors, although no such arrangement has been made. At this time, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock or through a loan from our directors to meet our obligations over the next twelve months. We do not have any arrangements in place for any future equity financing.

We do not expect to earn any revenue from operations until we have either commenced mining operations on a resource property, or operations on a non-resource property.

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the small business issuer's financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Results of Operations for the Three-Month Period Ended December 31, 2008

We did not earn any revenues during the three-month period ended December 31, 2008.

We incurred operating expenses in the amount of $12,842 for the three-month period ended December 31, 2008. These operating expenses were comprised of bank and interest charges of $86, expenses related to a mineral property of $4,728, and professional fees of $8,028.

Results of Operations for the Three-Month Period Ended December 31, 2007

We did not earn any revenues during the three-month period ended December 31, 2007.

We did not incur any operating expenses for the three-month period ended December 31, 2007.

Results of Operations for the Nine-Month Period Ended December 31, 2008

We did not earn any revenues during the nine-month period ended December 31, 2008.

We incurred operating expenses in the amount of $23,000 for the nine-month period ended December 31, 2008. These operating expenses were comprised of bank and interest charges of $162, expenses related to a mineral property of $4,728, and professional fees of $18,110.

Results of Operations from July 1, 2007 (inception) to December 31, 2007

No revenues were earned during this period.

We did not incur any operating expenses for this period.

Results of Operations from July 1, 2007 (inception) to December 31, 2008

No revenues were earned during this period.

We incurred operating expenses in the amount of $31,583 during this period. These operating expenses were comprised of bank and interest charges of $195, professional fees of $19,160, and expenses related to the mineral property of $12,228.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls

We evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2008. This evaluation was conducted by our chief executive officer and principal accounting officer.

Disclosure controls are controls and other procedures that are designed to ensure that information that we are required to disclose in the reports we file pursuant to the Securities Exchange Act of 1934 is recorded, processed, summarized and reported.

Limitations on the Effective of Controls

Our management does not expect that our disclosure controls or our internal controls over financial reporting will prevent all error and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, but no absolute, assurance that the objectives of a control system are met. Further, any control system reflects limitations on resources, and the benefits of a control system must be considered relative to its costs. These limitations also include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of a control. A design of a control system is also based upon certain assumptions about potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected.

Conclusions

Based upon their evaluation of our controls, the chief executive officer and principal accounting officer has concluded that, subject to the limitations noted above, the disclosure controls are effective providing reasonable assurance that material information relating to us is made known to management on a timely basis during the period when our reports are being prepared. There were no changes in our internal controls that occurred during the quarter covered by this report that have materially affected, or are reasonably likely to materially affect our internal controls.

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. Unregistered Sales of Equity Securities and Use of Proceeds

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.

Item 6. Exhibits and Report on Form 8-K

(a) Exhibits:

3.1* Articles of Incorporation

3.2* Bylaws

5.1* Legal opinion

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 906 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

filed as an exhibit to our registration statement on Form S-1 dated August 5, 2008.

(b) Reports on Form 8-K

We did not file any current reports on Form 8-K during the period.

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.

January 29, 2009

Legend Mining Inc.

/s/ Tao Chen

Tao Chen, President