NATE'S FOOD CO. - Quarter Report: 2008 September (Form 10-Q)
United States
Securities and Exchange Commission
Washington, DC 20549
FORM 10Q SB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2008
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
EXCHANGE ACT
Commission file Number 000-52831
CAPITAL RESOURCE ALLIANCE INC.
Exact name of small business issuer as specified in its charter
Colorado 20-5966439
(State or other jurisdiction of
I.R.S. Employer
incorporation or organization)
Identification Number
1013 1st Avenue, NW, Calgary, AB T2N 0A8 Canada
(Address of principal executive office)
(403) 827-7936
Issuer's telephone number
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PAST FIVE YEARS
Check whether the registrant filed all documents and reports required
To be filed by Section 12, 13 or 15 (d) of the Exchange Act after the distribution of
Securities under a plan confirmed by a court. Yes ____ No ____
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the Issuer's
Common equity as of the last practicable date: 20,400,000 shares
Transitional Small Business Disclosure Format (check one) Yes ___ No 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 [__]
As of the date of this report the Registrant had 20,400,000 shares issued and outstanding
Item 1.
CAPITAL RESOURCE ALLIANCE INC.
(An Exploration Stage Company)
INTERIM FINANCIAL STATEMENTS
September 30, 2008
(Unaudited)
2
CAPITAL RESOURCE ALLIANCE INC.
(An Exploration Stage Company)
BALANCE SHEETS
September 30, 2008 and December 30 2007
(Unaudited)
ASSETS | September 30, |
| 2008 |
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Current Assets: |
|
Cash | $ 1,097 |
Total current assets | 1,097 |
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Total Assets | $ 1,097 |
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
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Current Liabilities: |
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Accounts Payable | 5,975 |
Total Current Liabilities | 5,975 |
|
|
Stockholders' Equity (Deficit): |
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Preferred stock, $.001 par value; authorized 10,000,000, none issued | - |
Common stock, $.001 par value; 100,000,000 shares authorized |
|
20,400,000 issued and outstanding | 20,400 |
Additional paid in capital | 17,200 |
Accumulated deficit | (42,478) |
|
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Total Stockholders' Equity (Deficit) | (4,878) |
|
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Total Liabilities and Stockholders' Equity (Deficit) | $ 1,097 |
SEE ATTACHED NOTES
CAPITAL RESOURCE ALLIANCE INC.
(An Exploration Stage Company)
STATEMENTS OF OPERATIONS
for the three months ended September 30, 2008 and 2007
and for the period January 12, 2000 (Inception) to September 30, 2008
(Unaudited)
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| From |
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| January 12, 2000 |
|
| For the three |
| For the three |
| (Date of inception) |
|
| months ended |
| months ended |
| to |
|
| September 30, |
| September 30, |
| September 30, |
|
| 2008 |
| 2007 |
| 2008 |
|
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|
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Revenue: |
| $ - |
| $ - |
| $ - |
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Total Revenue |
| - |
| - |
| - |
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Operating Expenses: |
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Exploration costs |
| - |
| - |
| 5,000 |
General and administrative |
| 6,064 |
| 2,490 |
| 25,978 |
Impairment of mineral claims |
|
|
|
|
| 11,500 |
Total Operating Expenses |
| 6,064 |
| 2,490 |
| 42,478 |
|
|
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NET LOSS |
| $ (6,064) |
| $ (2,490) |
| $ (42,478) |
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Weighted Average Shares |
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Common Stock Outstanding |
| 20,400,000 |
| 20,400,000 |
|
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Net Loss Per Share |
|
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|
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(Basic and Fully Dilutive) |
| (0.00) |
| (0.00) |
|
|
SEE ATTACHED NOTES
CAPITAL RESOURCE ALLIANCE INC.
(An Exploration Stage Company)
STATEMENTS OF CASH FLOWS
for the three months ended September 30, 2008 and 2007
and for the period December 14, 2006 (Inception) to September 31, 2008
(Unaudited)
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| From |
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| January 12, 2000 |
|
| For the three |
| For the three |
| (Date of inception) |
|
| months ended |
| months ended |
| to |
|
| September 30, |
| September 30, |
| September 30, |
|
| 2008 |
| 2007 |
| 2008 |
Cash Flows Used in Operating Activities: |
|
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Net Loss |
| $ (6,064) |
| $ (2,490) |
| $ (42,478) |
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Adjustments to reconcile net (loss) to net cash provided |
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by operating activites: |
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Issuance of stock for services |
| - |
| - |
| 1,100 |
Impairment of mineral claims |
| - |
| - |
| 11,500 |
Increase in accounts payable |
| 5,975 |
| - |
| 5,975 |
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Net Cash Used in Operating Activities |
| (89) |
| (2,490) |
| (23,903) |
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Cash Flows from Investing Activities: |
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Acquisiton of mineral claims |
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| (10,000) |
Net cash used in investing activiites |
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| (10,000) |
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Cash Flows from Financing Activities: |
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Issuance of common stock for cash |
| - |
| - |
| 35,000 |
Net Cash Provided by Financing Activities |
| - |
| - |
| 35,000 |
|
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|
|
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|
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Net Increase (Decrease) in Cash |
| (89) |
| (2,490) |
| 1,097 |
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Cash at Beginning of Period |
| 1,186 |
| 8,655 |
| - |
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Cash at End of Period |
| $ 1,097 |
| $ 6,165 |
| $ 1,097 |
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Non-Cash Investing & Financing Activities |
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Issuance of stock for mineral claims |
| $ - |
| $ - |
| $ 1,500 |
Issuance of stock for services |
| $ - |
| $ - |
| $ 1,100 |
SEE ATTACHED NOTES
CAPITAL RESOURCE ALLIANCE INC.
(An Exploration Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
September 30, 2008
NOTE 1 – BASIS OF PRESENTATION
The interim financial statements of Capital Resource Alliance, Inc. (the Company) for the three months ended September 30, 2008 and 2007 and for the period from the date of inception on January 12, 2000 to September 30, 2008 are not audited. The financial statements are prepared in accordance with generally accepted accounting principles in the United States of America.
In the opinion of management, the accompanying financial statements contain all adjustments, consisting of normal recurring accruals, necessary for a fair presentation of the Company’s financial position as of September 30, 2008 and 2007and the results of its operations and cash flows for the three months ended September 30, 2008 and 2007 and for the period from the date of inception on January 12, 2000 to September 30, 2008.
The results of operations for the three months ended September 30, 2008 and 2007 are not necessarily indicative of the results for a full year period.
NOTE 2 – NATURE AND PURPOSE OF BUSINESS
Capital Resource Alliance, Inc. (the “Company”) was incorporated under the laws of the State of Colorado on January 12, 2000. The Company’s activities to date have been limited to organization and capital formation. The Company is “an exploration stage company” and has acquired a series of mining claims for exploration and formulated a business plan to investigate the possibilities of a viable mineral deposit. The Company has adopted June 30 as its fiscal year end.
NOTE 3 – NATURE OF SIGNIFICANT ACCOUNTING POLICIES
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid debt instruments purchased with maturity of three months or less to be cash equivalents.
REVENUE RECOGNITION
The Company considers revenue to be recognized at the time the service is performed.
USE OF ESTIMATES
The preparation of the Company’s financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company’s short-term financial instruments consist of cash and cash equivalents and accounts payable. The carrying amounts of these financial instruments approximate fair value because of their short-term maturities. Financial instruments that potentially subject the Company to a concentration of credit risk consist principally of cash. During the year the Company did not maintain cash deposits at financial institution in excess of the $100,000 limit covered by the Federal Deposit Insurance Corporation. The Company does not hold or issue financial instruments for trading purposes nor does it hold or issue interest rate or leveraged derivative financial instruments.
EARNINGS PER SHARE
Basic Earnings per Share (“EPS”) is computed by dividing net income available to common stockholders by the weighted average number of common stock shares outstanding during the year. Diluted EPS is computed by dividing net income available to common stockholders by the weighted-average number of common stock shares outstanding during the year plus potential
dilutive instruments such as stock options and warrant. The effect of stock options on diluted EPS is determined through the application of the treasury stock method, whereby proceeds received by the Company based on assumed exercises are hypothetically used to repurchase the Company’s common stock at the average market price during the period. Loss per share is unchanged on a diluted basis since the assumed exercise of common stock equivalents would have an anti-dilutive effect.
INCOME TAXES:
The Company uses the asset and liability method of accounting for income taxes as required by SFAS No. 109 “Accounting for Income Taxes”. SFAS 109 requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of certain assets and liabilities. Deferred income tax assets and liabilities are computed annually for the difference between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period, plus or minus the change during the period in deferred tax assets and liabilities.
Deferred income taxes may arise from temporary differences resulting from income and expanse items reported for financial accounting and tax purposes in different periods. Deferred taxes are
classified as current or non-current, depending on the classification of the assets and liabilities to which they relate. Deferred taxes arising from temporary differences that are not related to an
asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse. The Company had no significant deferred tax items arise during any of the periods presented.
CONCENTRATION OF CREDIT RISK:
The Company does not have any concentration of related financial credit risk.
RECENT ACCOUNTING PRONOUNCEMENTS:
The Company does not expect that the adoption of other recent accounting pronouncements will have a material impact to its financial statements.
NOTE 3 – MINERAL CLAIMS
The Company entered into a mineral claims purchase agreement on April 25th, 2007, whereby the Company purchased certain mineral claims located in the Abrey Township, Northwestern Ontario, Thunder Bay Mining District. These mineral claims were acquired from an individual for cash in the amount of $10,000 and the issuance of 500,000 shares of the Company’s common stock valued at $ .003 per share for a total purchase price of $11,500. After the acquisition of these mineral claims, management performed an impairment test to determine the carrying value of these claims. Management determined that there was no reasonable method to value the claims and have impaired the cost of these claims and recorded the expense during the year ended June 30, 2007.
NOTE 4 – COMMON STOCK
The Company issued 2,000,000 shares of its common stock in November 2006 in exchange for services rendered valued at $500.
The Company issued 2,400,000 shares of its common stock in January 2007 in exchange for services rendered valued at $600.
During the year ended June 30, 2007 the Company issued 14,000,000 shares of its common stock in exchange for cash. The shares were valued at $.01 per share for an aggregate value of $35,000.
The Company issued 2,000,000 shares of its common stock in April 2007 as a partial payment for the acquisition of mineral claims (see Note 3). These shares were valued at $.003 per share for an aggregate value of $1,500.
In January of 2008, the Company effected a three for one stock dividend of all of the outstanding shares of common stock on that date. Immediately before the stock dividend, the Company had 5,100,000 shares of common stock outstanding and after the stock dividend, the Company had 20,400,000 shares of common stock outstanding. This stock dividend has been retroactively reported in the shareholders’ equity as if the stock dividend had been effective at the inception of the Company.
NOTE 5 – GOING CONCERN
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As shown in the accompanying financial statements, the Company has no sales and has incurred a net loss of $ 42,478 since inception. The future of the Company is dependent upon its ability to obtain financing and upon future profitable operations from the development of its mineral properties. Management has plans to seek additional capital through a private placement and public offering of its common stock. The financial statements do not include any adjustments relating to the recoverability and classifications of recorded assets, or the amounts of and the classification of liabilities that might be necessary in the event the Company cannot continue in existence.
NOTE 6 – MINERALS CLAIM PURCHASE AGREEMENT
On July 11, 2008, the Company entered into a minerals claim purchase agreement with Queensland Potash Pty Ltd. (Potash) whereby the Company will acquire an interest in property and the mineral rights of that property located in North Queensland, Australia. Under the terms of the agreement, the Company will pay the sum of $3,250,000 for the property and mineral rights. The Company is obligated to pay the sum of $250,000 within twenty days of the execution of the agreement; an additional $250,000 within forty days of the execution of the agreement; an additional $250,000 within sixty days of the execution of the agreement and the balance of $2,500,000 will be paid by the issuance of shares of common stock of the Company at a maximum price of $1.00 per share.
As of the date of this report, November 12, 2008, the Company had not made any of the scheduled payments under the terms of the agreement. Management has not made the scheduled payments because the seller (Potash) had not met its obligations under the terms of the agreement.
Item 2.
Managements discussion and Plan of Operations
We are an exploration stage company engaged in the acquisition and exploration of mineral properties. We intend to commence operations as an exploration stage mineral exploration company. As such, there is no assurance that a commercially viable mineral deposit exists on our sole mineral property interest, the Long Lake claims. Further exploration will be required before a final evaluation as to the economic and legal feasibility of the Long Lake claims is determined.
We will be engaged in the acquisition, and exploration of mineral properties with a view to exploiting any mineral deposits we discover that demonstrate economic feasibility. We acquired a 100% undivided right, title and interest in and to several mineral claims located predominately under the lakebed of Long Lake, in the Beardmore-Geraldton Camp, Abrey Township, Northwestern Ontario, Canada Thunder Bay Mining District.
In order to acquire the claims, we paid $10,000 cash and 500,000 shares of our common stock to Mr. Donald Murdock, the vendor of the property in an arm’s length transaction.
On July 11,2008, Capital Resource Alliance entered into a contract with Queensland Potash Pty Ltd. to purchase an interest in a Potash mining property identified as EPM application Number 17503 located in North Queensland, Australia. The interest consists of five square miles (3,200 acres) of claims. A copy of the contract is attached to this filing as Exhibit 99.2.
Our plan of operation is to determine whether this Long Lake claims contains reserves of gold and/or silver that are economically recoverable. The recoverability of amounts from the property will be dependent upon the discovery of economically recoverable reserves, confirmation of 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.
Even if we complete our proposed exploration programs on the Long Lake claims and they are successful in identifying a mineral deposit, we will have to spend substantial funds on further drilling and engineering studies before we will know if we have a commercially viable mineral deposit.
Long Lake Claims Purchase Agreement
On September 19, 2007, we entered into an agreement with Mr. Donald Murdock of Calgary, Alberta, Canada, whereby he agreed to sell us a total of 21 units comprising two large blocks of mineral claims located approximately 16 kilometers from the village of Long Lake, Ontario. We agreed to have Mr. Murdock hold these claims in trust on our behalf for the sum of $10,000 and 500,000 shares of our restricted stock for a 100% undivided right, title and interest in and to these claims.
Queensland, Australia Potash Property
We are in the process of applying to the appropriate Australian authorities for drilling permits to further explore the five square miles of land lying over and extensive deposit of NaCl (Sodium Chloride or common salt) and KCL, (Potassium Chloride or Potash). Our plan is to drill a series of test holes to establish production targets and proceed to develop the property. Indications are that the most efficient and profitable method of production is to produce both salt and potash “in situ”, that is in place. A series of drill holes are completed and heated water pumped into the underlying formation that is up to 2,000 feet below the surface. The water dissolves the common salt and the potash and the resultant fluid or “liquor is recovered from a separate drill hole. At this point recovery of both salts is accomplished through evaporation. There is a huge ready market for all of the potash we can produce throughout Asia and Africa.
Item 3.
Quantitative and Qualitative Disclosures about Market Risk
We do not hold any derivative instruments and do not engage in any hedging activities. Because most of our purchases and sales will made in Canadian dollars, any exchange rate change affecting the value of the in Canadian dollar relative to the U.S. dollar could have an effect on our financial results as reported in U.S. dollars. If the in Canadian dollar were to depreciate against the U.S. dollar, amounts reported in U.S. dollars would be correspondingly reduced. If the in Canadian dollar were to appreciate against the U.S. dollar, amounts reported in U.S. dollars would be correspondingly increased.
Item 4T.
Controls and Procedures
Evaluation of Disclosure Controls and Procedures
As of the end of the period covered by this report, our management carried out an evaluation, under the supervision and with the participation of our principal executive officer and principal financial officer, 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 Exchange Act). Based on this evaluation, our principal executive officer and principal financial officer has concluded that our disclosure controls and procedures are, as of the date covered by this Quarterly Report, effective to ensure that the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms.
3
Changes in Internal Controls over Financial Reporting
In connection with the evaluation of our internal controls during our last fiscal quarter, our principal executive officer and principal financial officer has determined that there have been no changes to our internal controls over financial reporting that has materially affected, or is reasonably likely to materially effect, our internal controls over financial reporting.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 5. Other Events
None
Item 6. Exhibits and Reports on Form 8K
Exhibit 31.1 Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2003.
Exhibit 31.2 Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2003.
Exhibit 32.2 Certifications of CEO And CFO Pursuant To Section 906 Of The Sarbanes-Oxley Act
Exhibit 99.1 Report on Form 8K
4
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
CAPITAL RESOURCE ALLIANCE INC.
Dated November 14, 2008
/s/ Joseph Forzani
Joseph Forzani, President, Director and Chief Executive Officer
/s/ Frederick Fitzgerald
Frederick Fitzgerald, Secretary/Treasurer, Director and Principal Accounting Officer
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