New You, Inc. - Quarter Report: 2012 May (Form 10-Q)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

 (Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the quarterly period ended May 31, 2012

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

COMMISSION FILE NUMBER 333-136663

NOVA MINING CORPORATION
(Exact name of registrant as specified in its charter)

(210) 581-7753
(Registrant's telephone number, including area code)

2903 ½ Frank Gay Rd.

Marcellus, New York 13108
(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 x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. `See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).   Yes ¨ No x

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ITEM 1. FINANCIAL INFORMATION

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NOVA MINING CORP.OG, INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 – ORGANIZATION AND BASIS OF PRESENTATION

Basis of Presentation

The accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s most recent Annual Financial Statements filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim period presented have been reflected herein. The results of operations for the interim period are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal period, as reported in the Form 10-K, have been omitted.

Organization

Nova Mining, Corp. (‘Nova Mining” or the “Company”), was incorporated in the state of Nevada on December 29, 2005. The Company is an Exploration Stage Company, as defined by ASC 915 “Development Stage Companies”. The Company’s principal business is the acquisition and exploration of mineral resources. The Company has not presently determined whether its mineral claims contain reserves that are economically recoverable.

Going Concern

The accompanying financial statements have been prepared on the basis of accounting principles applicable to a “going concern”, which assume that Nova Mining will continue in operation for at least one year and will be able to realize its assets and discharge its liabilities in the normal course of operations.

Several conditions and events cast substantial doubt about Nova Mining’s ability to continue as a going concern.  Nova Mining has incurred net losses of  $623,996 for the period from (inception), December 29, 2005 to May 31, 2012, has had limited revenues and requires additional financing in order to finance its business activities on an ongoing basis. Nova Mining’s future capital requirements will depend on numerous factors including, but not limited to, executing its existing mining based business plan and the pursuit of business opportunities. Nova Mining is actively pursuing alternative financing and has had discussions with various third parties, although no firm commitments have been obtained.  In the interim, shareholders of Nova Mining have committed to meeting its minimal operating expenses.  

Management believes that actions presently being taken to revise Nova Mining’s operating and financial requirements provide them with the opportunity to continue as a going concern.

These financial statements do not reflect adjustments that would be necessary if Nova Mining were unable to continue as a going concern.  While management believes that the actions already taken or planned, will mitigate the adverse conditions and events which raise doubt about the validity of the “going concern” assumption used in preparing these financial statements, there can be no assurance that these actions will be successful.  If Nova Mining were unable to continue as a “going concern,” then substantial adjustments would be necessary to the carrying values of assets, the reported amounts of its liabilities, the reported revenues and expenses, and the balance sheet classifications used.

NOTE 2 – RELATED PARTY TRANSACTIONS

As of May 31, 2012, all activities of Nova Mining have been conducted by corporate officers from either their homes or business offices.  Currently, there are no outstanding debts owed by Nova Mining for the use of these facilities and there are no commitments for future use of the facilities.

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NOTE 3 - ADVANCES

As of May 31, 2012, a third party paid company expenses in the amount of $30,000. This amount is a non-interest bearing advance due by the Company.

NOTE  4 – NOTES PAYABLE

On September 1, 2011, a third party purchased the $110,000 owed to the former President of the Company and this amount was transferred to a promissory note on that date.  This loan is unsecured and payable on August 31, 2012 and is accruing 15% simple interest annually. As of February 29, 2012 the Company owes $110,000 in principal and $12,387 in interest on this note.

During the 3 months ended May 31, 2012, a third party loaned the Company $70,000.  Previously, during 2011 and 2012, that same entity loaned the Company $260,000. These loans are unsecured and payable a year from the signed note.  A $200,000 loan is accruing 10% simple interest annually and the remaining $130,000 in loans are accruing 15% simple interest annually. The $200,000 10% loan is past due since February 18, 2012. There is no default interest or penalty on this loan. As of May 21, 2012 the Company owes $330,000 in principal and $31,441 in interest on these notes.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report constitute "forward-looking statements." These statements, identified by words such as "plan," "anticipate," "believe," "estimate," "should," "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under the caption "Part II - Item 1A. Risk Factors" and elsewhere in this Quarterly Report. We do not intend to update the forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information. We advise you to carefully review the reports and documents, particularly our Annual Reports, Quarterly Reports and our Current Reports, we file from time to time with the Securities and Exchange Commission (the "SEC").

As used in this Quarterly Report, the terms "we," "us," "our," "Nova," and the "Company" refer to Nova Mining Corporation unless otherwise indicated. All dollar amounts in this Quarterly Report are expressed in U.S. dollars, unless otherwise indicated.

INTRODUCTION

We were incorporated on December 29, 2005 under the laws of the State of Nevada.

During the fiscal year ended February 29, 2008, we completed Phase IA of our exploration program on a claim known as the Columbia VI Claim, which included the placement of a control grid and the collection and analysis of soil and rock samples from the property.  At the conclusion of the program, and upon the recommendation of our consulting geologist, we abandoned the exploration program on the Columbia VI Claim and began researching alternate claim sites.

In February 2009, we engaged Consulting Geologist, D. Bain, B.Sc., P.Geo. of DUNCAN BAIN CONSULTING LTD. (“BAIN”), to select an area in Saskatchewan considered favorable for hosting diamondiferous kimberlite pipes. That site was staked by the Mr. Bain and registered with the province of Saskatchewan on March 18, 2009.

Duncan J. Bain, P.Geo. is an independent Qualified Person in accordance with Canadian securities National Instrument 43-101 and as defined in the CIM (Canadian Institute of Mining and Metallurgy) Standards on Mineral Resources and Reserves.

The Bittern Lake Project (“Claim”) consists of one claim of 256 hectares. This claim was registered on March 18, 2009 in the name of Duncan Bain, 49 Midale Crescent, London, Ontario, Canada N5X 3C2. Title to the Claim was subsequently transferred to Nova in April 2009.

The Claim is located in the east-central part of the province of Saskatchewan, in the NW corner of N.T.S. map sheet 73H/13, centered at Latitude 53o 59' North, Longitude 105o 53' West and UTM co-ordinates 5983000 N, 442000 E, Zone 13, using NAD 27 datum. The Claim covers an area of 256 hectares.

On March 29, 2011 the Company re-engaged the services of BAIN to direct a Phase 1 Exploration Program on the Claim.  The Company has agreed to pay to BAIN approximately $20,000 for the exploration and subsequent report. The Company anticipates the Phase 1 report will include positive findings and form the basis for further exploration of the Claim.

On February 15, 2012 we, entered into a 60 day option agreement with Natural Resources Recovery Guyana (NRRG), an affiliated company of CFG, LLC. NRRG is in the business of gold, diamond, and timber harvesting. The option agreement is for a period of sixty (60) days beginning from the date of the agreement. Nova Mining Corp. paid $5,000 for this option right. The assets for placement are five (5) concessions of gold, diamond, and timber harvesting interest which equates to 6,000 acres of land with the licenses and permits rights in the country of Guyana.

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On April 23, 2012 we, entered into a 60 day option agreement with Natural Resources Recovery Guyana (NRRG), an affiliated company of CFG, LLC. NRRG is in the business of gold, diamond, and timber harvesting. The option agreement is for a period of sixty (60) days beginning from the date of the agreement. Nova Mining Corp. paid $5,000 for this option right. The assets for placement are five (5) concessions of gold, diamond, and timber harvesting interest which equates to 6,000 acres of land with the licenses and permits rights in the country of Guyana.

RECENT CORPORATE DEVELOPMENTS

Effective May 21, 2012, a change of control took place and Clarent Services Corp. acquired from Half Moon Bay Holdings, LLC , 25,000,000 shares of common stock of the Registrant, representing all of Half Moon Bay’s holdings of the Registrant.  The shares constitute in the approximately 83.33% of the thirty million (30,000,000) issued and outstanding shares of common stock of the Company. There are no arrangements or understandings among members of the former and new control groups and their associates with respect to election of directors or other matters.

Effective May 21, 2012, Mr. Duncan Bain resigned as our President, Chief Executive Officer, and Chief Financial Officer and was appointed as our Vice President. There were no disagreements between Mr. Bain and us regarding any matter relating to our operations, policies or practices. Mr. James Dilger was appointed as President, Chief Executive Officer, and Chief Financial Officer in place of Mr. Bain.

Concurrently with the change of our President, we moved our principal executive offices to:

9901 I.H. 10 West Suite 800

San Antonio, Texas 78230

Our new telephone number is: (210) 581-7753

This location is the office our new President Mr. James Dilger.

PLAN OF OPERATION

During the fiscal year ended February 29, 2008, we completed Phase IA of our exploration program on a claim known as the Columbia VI Claim, which included the placement of a control grid and the collection and analysis of soil and rock samples from the property.  At the conclusion of the program, and upon the recommendation of our consulting geologist, we abandoned the exploration program on the Columbia VI Claim and began researching alternate claim sites.

In February 2009, we engaged Consulting Geologist, D. Bain, B.Sc., P.Geo. of DUNCAN BAIN CONSULTING LTD. (“BAIN”), to select an area in Saskatchewan considered favorable for hosting diamondiferous kimberlite pipes. That site was staked by the Mr. Bain and registered with the province of Saskatchewan on March 18, 2009.

Duncan J. Bain, P.Geo. is an independent Qualified Person in accordance with Canadian securities National Instrument 43-101 and as defined in the CIM (Canadian Institute of Mining and Metallurgy) Standards on Mineral Resources and Reserves.

The Bittern Lake Property was staked to explore for diamond-bearing kimberlite bodies of the Fort a la Corne type. The property consists of one claim which was staked by Duncan Bain in March 2009. The claim covers an area of 256 hectares in Townships 58, Range 27, Section 1West of the Second Meridian, and falls within N.T.S. map sheet 73H/13. The property lies approximately 60 kilometers NNW of Shore Gold's Star kimberlite body, 75 kilometers NNW of Kensington/DeBeers' 140/141 kimberlites and 25 kilometers W of the Kennecott/War Eagle/Great West Gold kimberlite bodies C-28, 29 and 30.

No exploration work has been carried out on the Bittern Lake property. Fifteen kilometers to the N an airborne magnetic survey was conducted in 1994. From that work three small claim blocks were staked and surveyed with ground-based magnetics. Targets selected from this work were drill tested but no kimberlite was noted. The Bittern Lake project area was selected due to the presence of a circular strong positive gravity anomaly on the edge of a positive linear magnetic anomaly along trend of the main kimberlite field. Accessibility was also a factor in selecting the area.

On March 29, 2011 the Company re-engaged the services of BAIN to direct a Phase 1 Exploration Program on the Claim.  The Company has agreed to pay to BAIN approximately $20,000 for the exploration and subsequent report. The Company anticipates the Phase 1 report will include positive findings and form the basis for further exploration of the Claim.

The Fort a la Corne kimberlite field is one of the world's largest known resources of diamondiferous kimberlite, and is located in east-central Saskatchewan, Canada. Currently 75 kimberlite bodies have been confirmed by drilling since the initial discovery in 1988. The main kimberlite field seems to follow a NNW-oriented trend. The Bittern Lake Property lies along trend NNW from the main field.

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The Fort a la Corne area of Saskatchewan is easily accessible by road. The southern half of the area consists of agricultural land, while the northern half is of provincial forest. The kimberlite bodies have no surface expression and are covered by 100 m, on average, of glacial overburden. The Fort a la Corne Joint Venture of Cameco Corp., De Beers Canada Exploration Inc. and Kensington Resources Ltd., holds 63 drill-tested kimberlite bodies. Eight kimberlite bodies are held by Shore Gold Inc., one by Consolidated Pine Channel/Shane Resources/United Carina, and one by Forest Gate Resources. Three kimberlites, held by Great Western Minerals Corp/War Eagle Mining make up one of several sub-clusters of kimberlite bodies found around the main field.

As of May 31, 2012, we had cash on hand of $26,132 and a accumulated deficit of $(623,996). As such, we anticipate that we will require substantial financing in the near future in order to meet our current obligations and to continue our operations. In addition, in the event that we are successful in identifying suitable alternative business opportunities, of which there is no assurance, we anticipate that we will need to obtain additional financing in order to pursue those opportunities.

OFF-BALANCE SHEET ARRANGEMENTS

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

CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with United States generally accepted accounting principles requires our management to make estimates and assumptions that affect the reported amount 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. Actual results could differ from those estimates. Our management routinely makes judgments and estimates about the effects of matters that are inherently uncertain.

We have identified certain accounting policies, described below, that are most important to the portrayal of our current financial condition and results of operation.

USE OF ESTIMATES

The preparation of financial statements in conformity with U.S. 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. Actual results could differ from those estimates.

FINANCING REQUIREMENTS

From December 29, 2005 (Inception) to May 31, 2012, we have suffered cumulative losses in the amount of $(623,996). We expect to continue to incur substantial losses as we continue the development of our business. Since our inception, we have funded operations through common stock issuances, related party loans, and the support of creditors in order to meet our strategic objectives. Our management believes that sufficient funding will be available to meet our business objectives, including anticipated cash needs for working capital, and are currently evaluating several financing options, including a public offering of securities. However, we do not have any financing arrangements currently in place and there can be no assurance that we will be able to obtain sufficient financing when needed. As a result of the foregoing, our independent auditors believe there exists substantial doubt about our ability to continue as a going concern.

There is no assurance that we will be able to obtain additional financing if and when required. We anticipate that additional financing may come in the form of sales of additional shares of our common stock which may result in dilution to our current shareholders.

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GOING CONCERN QUALIFICATION

Several conditions and events cast substantial doubt about the Company’s ability to continue as a going concern.  The Company has incurred net losses of $(623,996) for the period from December 29, 2005 to May 31, 2012, has no revenues and requires additional financing in order to finance its business activities on an ongoing basis.  The Company’s future capital requirements will depend on numerous factors including, but not limited to, executing the company’s mining based business plan and the pursuit of other business opportunities. The Company is actively pursuing alternative financing and has had discussions with various third parties, although no firm commitments have been obtained.  In the interim, shareholders of the Company have committed to meeting its minimal operating expenses.  Management believes that actions presently being taken to revise the Company’s operating and financial requirements provide them with the opportunity to continue as a going concern. 

At February 29, 2012, we had $4,581 cash on hand, and a deficit accumulated during the development stage of $(537,492). At May 31, 2012, we had $26,132 cash on hand, and a deficit accumulated during the development stage of $(623,996).  See Liquidity and Capital Resources.”

LIQUIDITY AND CAPITAL RESOURCES

 It is the intent of our management, stockholders and our President, James Dilger and Vice President, Duncan Bain to provide sufficient working capital necessary to support and preserve the integrity of our Company as a corporate entity.  However, there is no legal obligation for either Mr. Dilger or Mr. Bain to provide additional future funding. If our management and/or Mr. Dilger or Mr. Bain ceases to provide us the needed financing and we fail to identify any alternative sources of funding, there will be substantial doubt about our ability to continue as a “going concern”.

We have no current plans, proposals, arrangements or understandings with respect to the sale or issuance of additional securities.  As a result, there can be no assurance that sufficient funds will be available to us to enable us to pay the expenses related to such activities.

Regardless of whether or not our cash assets prove to be adequate to meet our operational needs, we may have to compensate providers of services by issuances of our common stock in lieu of cash.

At May 31, 2012, we had $26,132 cash on hand and an accumulated deficit of $(623,996).  Our primary source of liquidity has been from loans from a previous majority shareholder and loans from outside parties, as well as company expenses paid by outside parties, booked as non-bearing advances. As of May 31, 2012, the Company owed $440,000 in principal on notes loaned to the company, $43,828 in interest on the notes and $30,000 in noninterest-bearing advances.

Net cash used in operating activities was $48,449 during the three-month period ended May 31, 2012.  

Net cash provided by financing activities was $70,000 during three-month period ended May 31, 2012.

Our expenses to date are largely due to accounting fees, consulting fees and officer and director compensation.

To date, we have had minimal revenues and require additional financing in order to finance our business activities on an ongoing basis.  Our future capital requirements will depend on numerous factors, including, but not limited to, executing our mining based business plan and the ability to pursue other business opportunities. We are actively pursuing alternative financing and have had discussions with various third parties, although no firm commitments have been obtained to date.  In the interim, shareholders of the Company have agreed to meet our minimal operating expenses.  We believe that actions presently being taken to revise our operating and financial requirements provide the Company with the opportunity to continue as a “going concern,” although no assurances can be given.

NET LOSS FROM OPERATIONS

The Company had a net loss of $(623,996) for the period from inception through May 31, 2012. The Company had net loss of $(86,504) for the three months ended May 31, 2012 as compared to a net loss of $(139,852) for the three months ended May 31, 2011.

CASH FLOW

Our primary source of liquidity has been cash from shareholder loans, loans from outside parties and advances.

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WORKING CAPTIAL

As of February 29, 2012, the Company had total current assets of $4,581 and total current liabilities of $409,023, resulting in working capital deficit of $404,442.  As of May 31, 2012, the Company had total current assets of $26,132 and total current liabilities of $517,078, resulting in a working capital deficit of $490,946.  

THREE MONTHS ENDED MAY 31, 2012 COMPARED TO THE THREE MONTHS ENDED MAY 31, 2011

OPERATION AND ADMINISTRATIVE EXPENSES

Operating expenses decreased by $60,609 from $134,738 in the three months ended May 31, 2011, to $74,129 in the three months ended May 31, 2012.  Operating expenses for the three months comparison primarily consist of General and Administrative expenses (G&A). G&A expenses are made up primarily of accounting and consulting expenses and officer and director compensation for services. Such fees are paid throughout the year for performing various tasks.  

COMMON STOCK AND PREFERRED STOCK

We are authorized by our Amended and Restated Articles of Incorporation and our Additional Articles of Incorporation to issue an aggregate of 200,000,000 shares of capital stock, of which 100,000,000 are shares of common stock, par value $0.00001 per share (the “Common Stock”) and 100,000,000 are shares of preferred stock (the “Preferred Stock”), par value $0.00001 per share.  As of May 31, 2012, 30,000,000 shares of Common Stock were issued and outstanding and there were 18 shareholders of our Common Stock and 0 shares of Preferred Stock were issued and outstanding.

On October 27, 2011 the Company declared a stock dividend of five common shares for each common share on record. The total number of shares to be distributed is 24,000,000. Since the total number of shares to be issued exceed 25% of the common shares outstanding, the transaction is recorded as a stock split and offset to additional paid in capital at par value and the effect of the issuance is applied retroactively to all periods presented.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 4. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

For purposes of this Item 4., the term disclosure controls and procedures means controls and other procedures of the Company (i) that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934, as amended (15 U.S.C. 78a et seq. and hereinafter the “Exchange Act”) is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “Commission”), and (ii)  include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our disclosure controls and procedures do not comply with the requirements in (i) and (ii) above.  

Our Chief Executive Officer and Chief Financial Officer James Dilger, has reviewed the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) as of the end of the period covered by the report May 31, 2012 and has concluded that (i) the Company’s disclosure controls and procedures are not effective to ensure that material information relating to the Company is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the Commission, and (ii) the Company’s controls and procedures have not been designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  

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REPORT OF MANAGEMENT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America. Internal control over financial reporting includes maintaining records that in reasonable detail accurately and fairly reflect our transactions; providing reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; providing reasonable assurance that receipts and expenditures of Company assets are made in accordance with management authorization; and providing reasonable assurance that unauthorized acquisition, use or disposition of Company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis. Because of its inherent limitations, our internal control over financial reporting does not provide assurance that a misstatement of our financial statements would be prevented or detected.

As of February 29, 2012, management conducted an evaluation of the effectiveness of our internal control over financial reporting and found it to be not effective subsequent to filing our Annual Report on Form 10-K for the year ended February 29, 2012 on April 23, 2012, with the Commission. Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Management has concluded that the Company’s internal controls over financial reporting are not effective because as noted in this Annual Report, we have limited resources available. As we obtain additional funding and employ additional personnel, we will implement programs recommended by the Treadway Commission to ensure the proper segregation of duties and reporting channels.

Our independent public accountant, Malone Bailey LLP, has not conducted an audit of our controls and procedures regarding internal control over financial reporting. Consequently, Malone Bailey LLP expresses no opinion with regards to the effectiveness or implementation of our controls and procedures with regards to internal control over financial reporting.

CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING

There were no changes in our internal control over financial reporting identified in connection with our evaluation of these controls as of the first fiscal quarter ended May 31, 2012 as covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

INHERENT LIMITATIONS ON EFFECTIVENESS OF CONTROLS

The Company's management does not expect that its disclosure controls or its internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met. 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. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

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ITEM 1. LEGAL PROCEEDINGS

None.

ITEM 1A. RISK FACTORS

The following are some of the important factors that could affect our financial performance or could cause actual results to differ materially from estimates contained in our forward-looking statements. We may encounter risks in addition to those described below. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, may also impair or adversely affect our business, financial condition or results of operation.

WE HAVE LIMITED BUSINESS OPERATIONS AND A SINGLE MINING CLAIM. WE HAVE NOT IDENTIFIED ANY ALTERNATIVE BUSINESS OPPORTUNITIES. OUR PLAN OF OPERATION FOR THE NEXT TWELVE MONTHS WILL CONSIST OF EXECUTING OUR BUSINESS PLAN AND RESEARCHING NEW OPPORTUNITIES.

Our sole asset is our Bittern Lake Project.  The Bittern Lake Project (“Claim”) consists of one claim of 256 hectares. This claim was registered on March 18, 2009 in the name of Duncan Bain, 49 Midale Crescent, London, Ontario, Canada N5X 3C2. Title to the Claim was subsequently transferred to Nova in April 2009.  We have no experience in mining operations and it is not guaranteed that we will be able to locate diamonds in our claim, or that we will have the resources to capitalize on the Claim should we find commercially viable deposits.

WE MAY NOT BE ABLE TO OBTAIN ADDITIONAL FINANCING.

For the year ended, February 29, 2012, we had cash on hand of $4,581 and a working capital deficit of $(404,442).

For the three months ended, May 31, 2012, we had cash on hand of $26,132 and a working capital deficit of $(490,946).

Currently, we are a development state enterprise; as such, our ability to obtain additional financing may be substantially limited. If sufficient financing is not available or obtainable as and when needed, we may not be able to continue as a going concern and investors may lose a substantial portion or all of their investment. We currently do not have any financing arrangements in place and there are no assurances that we will be able to acquire financing on acceptable terms or at all.

WE HAVE LIMITED OFFICERS AND DIRECTORS

Because management consists of only three persons, while seeking a business combination, James Dilger, President, CEO, CFO Duncan Bain, Vice President and Carmen Joseph Carbona, Non-Executive Chairman of the Board of Directors, will be the only individuals responsible in conducting the day-to-day operations of the Company.  We do not benefit from having access to multiple judgments that a greater number of directors or officers would provide, and we will rely completely on the judgment of our two officers when selecting a target company.  Mr. Dilger, Mr. Bain and Mr. Carbona anticipate devoting only a limited amount of time per month to the business of the Company.  Mr. Dilger, Mr. Bain and Mr. Carbona all have written employment agreements with the Company, however we do not anticipate obtaining key man life insurance on Mr. Dilger, Mr. Bain and Mr.Carbona. The loss of the services of Mr. Dilger, Mr. Bain and Mr. Carbona would adversely affect development of our business and our likelihood of continuing operations.

WE DEPEND ON MANAGEMENT AND MANAGEMENT’S PARTICIPATION IS LIMITED

We will be entirely dependent upon the experience of our officers and directors in seeking, investigating, and acquiring a business and in making decisions regarding our operations.  It is possible that, from time to time, the inability of such persons to devote their full time attention to the Company will cause the Company to lose an opportunity.

WE MAY CONDUCT FURTHER OFFERINGS IN THE FUTURE IN WHICH CASE INVESTORS' SHAREHOLDINGS WILL BE DILUTED.

We may conduct equity offerings in the future to finance any future business projects that we decide to undertake. If common stock is issued in return for additional funds, the price per share could be lower than that paid by our current stockholders. We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. If we issue additional stock, investors' percentage interest in us will be diluted. The result of this could reduce the value of their stock.

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BECAUSE OUR STOCK IS A PENNY STOCK, STOCKHOLDERS WILL BE MORE LIMITED IN THEIR ABILITY TO SELL THEIR STOCK.

The shares of our common stock constitute "penny stocks" under the Exchange Act. The shares will remain classified as a penny stock for the foreseeable future. The classification as a penny stock makes it more difficult for a broker/dealer to sell the stock into a secondary market, which makes it more difficult for a purchaser to liquidate his or her investment. Any broker/dealer engaged by the purchaser for the purpose of selling his or her shares will be subject to rules 15g-1 through 15g-10 of the Exchange Act. Rather than having to comply with these rules, some broker-dealers will refuse to attempt to sell a penny stock.

The "penny stock" rules adopted by the SEC under the Exchange Act subjects the sale of the shares of our common stock to certain regulations which impose sales practice requirements on broker/dealers. For example, brokers/dealers selling such securities must, prior to effecting the transaction, provide their customers with a document that discloses the risks of investing in such securities.

Legal remedies, which may be available to an investor in "penny stocks," are as follows:

(a) if "penny stock" is sold to an investor in violation of his or her rights listed above, or other federal or states securities laws, the investor may be able to cancel his or her purchase and get his or her money back.
(b) if the stocks are sold in a fraudulent manner, the investor may be able to sue the persons and firms that caused the fraud for damages.
(c) if the investor has signed an arbitration agreement, however, he or she may have to pursue his or her claim through arbitration.

ITEM 2. UNREGISTERED SALE OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINING SAFTEY DISCLOSURE

Not Applicable.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

*Pursuant to Rule 406T of Regulation S-T, these interactive date files are deemed not filed or part of the registration statement or prospectus for purposes of Sections 11 and 12 of the Securities Act of 1933 or Section 18 of the Securities Act of 1934 and otherwise are not subject to liability.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

                                           NOVA MINING CORPORATION

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