Transportation & Logistics Systems, Inc. - Quarter Report: 2014 September (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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 September 30, 2014

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

For the transition period from _____ to _____

Commission File No. 333-159517

PetroTerra Corp.

(Exact Name of Issuer as specified in its charter)

422 East Vermijo Avenue, Suite 313

Colorado Springs, Colorado 80903

(Address of principal executive offices)

719-219-6404

(Issuer’s telephone number)

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

Indicate by checkmark whether the issuer: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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. 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 Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for shorter period that the registrant was required to submit and post such files). Yes [  ] No [X]

Indicate by check mark whether the registrant is a large accelerated filed, an accelerated filer, a non-accelerated filer or a smaller reporting company.

Large accelerated filer [  ] Accelerated filer [  ] Non-accelerated filer [  ] Small reporting company [X]

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the most practicable date:

FORM 10-Q

PETROTERRA CORP.

INDEX

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

PetroTerra Corp.

BALANCE SHEETS

As of September 30, 2014 And March 31, 2014

(Unaudited)

The accompanying notes are an integral part of these financial statements.

PETROTERRA CORP.

STATEMENTS OF OPERATIONS

FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2014 AND 2013

(Unaudited)

The accompanying notes are an integral part of these financial statements.

PETROTERRA CORP.

STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2014 AND 2013

(Unaudited)

The accompanying notes are an integral part of these financial statements.

PETROTERRA CORP.

Notes To The Financial Statements

September 30, 2014

(Unaudited)

1. ORGANIZATION AND BUSINESS OPERATIONS

PetroTerra Corp. (the “Company”) was incorporated under the laws of the State of Nevada, on July 25, 2008. The Company is an independent exploration and development company focused on the acquisition of property (or property leases enabling us to explore and exploit such property) that we believe may contain extractable oil and/or gas. The Company plans to identify, evaluate and acquire oil and gas exploration and development opportunities primarily within the United States. The Company has not generated any revenue to date and consequently its operations are subject to all risks inherent in the establishment of a new business enterprise.

2. GOING CONCERN

The 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 $630,572 as of September 30, 2014 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 obtaining the necessary financing to meet its obligations and repay its liabilities which have arisen from normal business operations as they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand loans from our director and/or private placements of common stock.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.

These statements reflect all adjustments, including of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein. It is suggested that these unaudited interim financial statements be read in conjunction with the financial statements of the Company for the year ended March 31, 2014 and notes thereto included in the Company’s annual report on Form 10-K. The Company follows the same accounting policies in the preparation of its annual and interim reports.

Cash and Cash Equivalents

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

Use of Estimates and Assumptions

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, 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. In management’s opinion, all adjustments necessary for a fair statement of the results for the interim periods have been made and all adjustments are of a normal recurring nature.

PETROTERRA CORP.

Notes To The Financial Statements

September 30, 2014

(Unaudited)

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Foreign Currency Translation

The Company’s functional currency and its reporting currency is the United States dollar.

Stock Split

On December 18, 2013, the Company filed a Certificate of Change with the Secretary of State of the State of Nevada to effect a reverse stock split of its outstanding and authorized shares of common stock at a ratio of one for two (the “Reverse Stock Split”).

As a result of the Reverse Stock Split, the Company’s authorized shares of common stock were decreased from 200,000,000 to 100,000,000 shares and its authorized shares of preferred stock were decreased from 20,000,000 to 10,000,000 shares. Upon the effectiveness of the Reverse Stock Split, which occurred on December 20, 2013, the Company’s issued and outstanding shares of common stock was decreased from 126,698,000 to 63,349,000 shares, all with a par value of $0.001. The Company has no outstanding shares of preferred stock. Accordingly, all share and per share information has been restated to retroactively show the effect of the Reverse Stock Split.

Stock-based Compensation

In September 2009, the FASB issued ASC-718, “Stock Compensation”. ASC-718 requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on the grant date fair value of the award. Under ASC-718, the Company must determine the appropriate fair value model to be used for valuing share-based payments, the amortization method for compensation cost and the transition method to be used at date of adoption.

Income Taxes

Income taxes are accounted for under the assets and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating losses and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.

Basic and Diluted Loss Per Share

The Company computes loss per share in accordance with ASC-260, “Earnings per Share” which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. Basic loss per share is computed by dividing net loss available to common stockholders by the weighted average number of outstanding shares of common stock during the period. Diluted loss per share gives effect to all dilutive potential shares of common stock outstanding during the period. Dilutive loss per share excludes all potential shares of common stock if their effect is anti-dilutive. The Company has no potential dilutive instruments and accordingly basic loss and diluted loss per share are equal.

Fiscal Periods

The Company’s fiscal year end is March 31.

PETROTERRA CORP.

Notes To The Financial Statements

September 30, 2014

(Unaudited)

Revenue Recognition

The Company will recognize revenue in accordance with ACS - 605, “Revenue recognition”, ASC-605 requires that four basic criteria be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.

Oil and Gas

The Company complies with ASC 932, “Extractive Activities - Oil and Gas”. The Company has capitalized exploratory well costs, and has determined that there are no suspended well costs that should be impaired. The Company reviews its long-lived assets for impairments when events or changes in circumstances indicate that impairment may have occurred.

Website

The Company capitalizes the costs associated with the development of the Company’s website pursuant to ASC - 350, “Goodwill and Other”. Other costs related to the maintenance of the website are expensed as incurred. Amortization is provided over the estimated useful lives of three years using the straight-line method for financial statement purposes. The Company commenced amortization upon completion of the Company’s fully operational website. Amortization expense for the six months ended September 30, 2014 and 2013 totaled $4,384 and $0, respectively.

Property and Equipment

Property and equipment are carried at cost. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. Depreciation and amortization of property and equipment is provided using the straight-line method for financial reporting purposes at rates based on the following estimated useful lives:

PETROTERRA CORP.

Notes To The Financial Statements

September 30, 2014

(Unaudited)

Advertising

The Company follows the policy of charging the costs of advertising to expenses incurred. The Company incurred $0 in advertising costs during the six months ended September 30, 2014.

Recent Accounting Pronouncements

ASU 2014-10, Development Stage Entities

On June 10, 2014, the Financial Accounting Standards Board (“FASB”) issued update ASU 2014-10, Development Stage Entities (Topic 915). Amongst other things, the amendments in this update removed the definition of development stage entity from Topic 915, thereby removing the distinction between development stage entities and other reporting entities from US GAAP. In addition, the amendments eliminate the requirements for development stage entities to (1) present inception-to-date information on the statements of income, cash flows and shareholders equity, (2) label the financial statements as those of a development stage entity; (3) disclose a description of the development stage activities in which the entity is engaged and (4) disclose in the first year in which the entity is no longer a development stage entity that in prior years it had been in the development stage. The amendments are effective for annual reporting periods beginning after December 31, 2014 and interim reporting periods beginning after December 15, 2015, however entities are permitted to early adopt for any annual or interim reporting period for which the financial statements have yet to be issued. The Company has elected to early adopt these amendments and accordingly have not labeled the financial statements as those of a development stage entity and have not presented inception-to-date information on the respective financial statements.

4. ACQUISITION OF OIL AND GAS PROPERTIES

On November 18, 2013, the Company entered into an assignment of lease (the “Agreement”) whereby Ardmore Investments Inc. (“Ardmore”) assigned to the Company its rights under a certain purchase agreement (the “Purchase Agreement”), dated August 8, 2013, between Ardmore and Pioneer Oil and Gas (“Pioneer”) involving the sale of 5,905.54 acres of oil and gas leases (the “Leases”) located in the Central Utah Thrust Belt in Beaver County and Sevier County, Utah (the “Utah Properties”). Per the terms of the Agreement, we issued to Ardmore an aggregate 500,000 shares (250,000 share installments) of our common stock on November 18, 2013, and April 12, 2014, in order to complete the assignment. Furthermore, on December 12, 2013, February 12, 2014, and April 12, 2014, the Company made three installment payments of $100,000 each to Pioneer. Upon completion of the final installment the leases were conveyed to the Company.

Due to the lack of an active market of the Company’s common stock, the fair value of the common stock issued to Ardmore was determined based on the price at which the Company’s shares were most recently sold in a private placement transaction.

5. COMMON STOCK

The Company’s authorized capital consist of 100,000,000 shares of common stock and 10,000,000 shares of preferred stock, both with a par value of $0.001 per share.

This gives effect to the Company’s 32 for 1 forward stock split that was effected on January 3, 2012 and the Company’s subsequent Reverse Stock Split that was effected on December 18, 2013. All share and per share information has been restated in this Report to retroactively show the effect of the two stock splits.

On December 18, 2013, the Company effectuated a Reverse Stock Split of its outstanding and authorized shares of common stock at a ratio of one for two. As a result of the Reverse Stock Split, the Company’s authorized shares of common stock were decreased from 200,000,000 to 100,000,000 shares and its authorized shares of preferred stock were decreased from 20,000,000 to 10,000,000 shares. Upon the effectiveness of the Reverse Stock Split, which occurred on December 20, 2013, the Company’s issued and outstanding shares of common stock was decreased from 126,698,000 to 63,349,000 shares, all with a par value of $0.001. The Company has no outstanding shares of preferred stock. Accordingly, all share and per share information has been restated to retroactively show the effect of the Reverse Stock Split.

On November 28, 2008, the Company issued 14,400,000 shares of common stock at a price of $0.0000625 per share for total cash proceeds of $900.

On December 4, 2008, the Company issued 32,000,000 shares of common stock at a price of $0.0000625 per share for total cash proceeds of $2,000.

PETROTERRA CORP.

Notes To The Financial Statements

September 30, 2014

(Unaudited)

5. COMMON STOCK (continued)

During the period December 10, 2008 to March 19, 2009, the Company issued 30,240,000 shares of common stock at a price of $0.000625 per share for total cash proceeds of $18,900.

On December 14, 2011, in connection with a change in the Company’s directors, two controlling stockholders cancelled an aggregate of 23,872,000 shares of common stock. On the same day, 256,000 shares of common stock were issued to a director for services rendered. The common stock was valued at $0.000625 per share.

On October 2, 2013, John Barton purchased 43.0% of the issued and outstanding shares of common stock of the Company from former stockholders. Concurrently with Mr. Barton’s purchase, the Board of Directors of the Company determined that it was in the best interest of the Company to settle a portion of an outstanding loan from Mr. Barton to the Company. In exchange for the settlement of the outstanding debt, the Company issued Mr. Barton 10,000,000 shares of common stock. Upon completion of the above transactions, Mr. Barton became the beneficial owner of 52.01% of the issued and outstanding shares of common stock .

On November 1, 2013, the Company sold a total of 75,000 shares of common stock for gross proceeds of $75,000.

On November 20, 2013, the Company issued 250,000 shares of common stock in conjunction with a land lease assignment with a value of $250,000.

On December 19, 2013, the Company sold a total of 150,000 shares of common stock for gross proceeds of $150,000.

On February 14, 2014, the Company sold a total of 200,000 shares of common stock for gross proceeds of $150,000.

On March 6, 2014, the Company authorized the issuance of 50,000 shares of common stock to a third party entity for consulting services. The fair value of the shares of common stock was $37,500. On March 31, 2014, the $37,500 was recorded to common stock payable and a stock certificate representing the shares of common stock was issued on June 30, 2014.

On March 10, 2014, the Company entered into a private placement for 100,000 shares of common stock for gross proceeds of $75,000. On March 10, 2014 and March 25, 2014, the Company received an aggregate of $52,500 of the proceeds. The remaining $22,500 of proceeds was received on April 24, 2014. A certificate representing the shares of common stock payable was issued on April 24 2014.

On April 12, 2014, in connection with the Agreement, the Company issued to Ardmore 250,000 shares of our common stock.

On May 7, 2014, the Company sold a total of 200,000 shares of common stock for gross proceeds of $150,000.

On August 22, 2014 the Company sold a total of 483,871 shares of common stock for gross proceeds of $150,000.

PETROTERRA CORP.

Notes To The Financial Statements

September 30, 2014

(Unaudited)

On September 2, 2014, the Company authorized the issuance of 50,000 shares of common stock to a third party entity for consulting services. The fair value of the shares of common stock was $20,500.

On September 16, 2014, the Company authorized the issuance of 50,000 shares of common stock to the Company’s newly appointed Chief Operating Officer for consulting services. The fair value of the shares of common stock was $20,500.

As of September 30, 2014, the Company had 64,882,871 shares of common stock issued and outstanding.

6. INCOME TAXES

As of September 30, 2014, the Company had net operating loss carry forwards of approximately $630,572 that may be available to reduce future years’ taxable income through 2033. 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. Accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.

7. RELATED PARTY TRANSACTIONS

The Company has received advances from certain of its officers and other related parties to meet short term working capital needs. These advances may not have formal repayment terms or arrangements. As of September 30, 2014 and March 31, 2014, the total amount loaned to the Company by a director was $10,118. The loan is non-interest bearing, due upon demand and unsecured.

On October 2, 2013, the Company settled an outstanding loan with a principal amount of $51,525 by exchanging 10,000,000 shares of common stock for conversion of outstanding debt of $20,000 due to the Company’s chief executive officer and the remaining $31,525 of outstanding debt due to the previous chief executive officer was extinguished to Additional paid-in capital.

On October 2, 2013, the Company settled an outstanding loan with a principal amount of $20,000 due to the Company’s Chief Executive Officer in exchange for 10,000,000 shares of common stock.

8. SUBSEQUENT EVENT

The Company has evaluated subsequent events from September 30, 2014 through the filing of these financial statements. There are no significant subsequent events, except as disclosed below:

Common Stock

In October, 2014 the Company sold 147,059 shares of common stock for gross proceeds of $50,000.

FORWARD LOOKING STATEMENTS

Statements made in this Form 10-Q that are not historical or current facts are “forward-looking statements” made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements often can be identified by the use of terms such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate” or “continue,” or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management’s best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

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

GENERAL

We are an independent exploration and development company that plans to identify, evaluate and acquire oil and gas exploration and development opportunities primarily in the United States.

We were incorporated under the laws of the State of Nevada on July 25, 2008 as “Loran Connection Corp.” We were formed to provide a variety of services in the area of individual and group tourism and business support in Ukraine. We subsequently filed a resale registration statement with the Securities and Exchange Commission on May 28, 2009 which was declared effective on October 28, 2009. On January 25, 2012, we filed an amendment to our articles of incorporation to, among other things, change our name to “PetroTerra Corp.” and effect a thirty-two-for-one forward stock split. We changed our name to reflect a proposed change in our business operations. On October 2, 2013, in connection with a change of control in the management of the Company, the Company began its current business operations in the oil and gas sector. On December 18, 2013, we filed a certificate of change to effect a one-for-two reverse stock split of our authorized and our outstanding shares of common stock and preferred stock. On April 12, 2014, we completed our acquisition of certain property Leases held by Ardmore for property owned by Pioneer covering 5,905.54 acres of land located in the Central Utah Thrust Belt in Beaver County and Sevier County, Utah.

Our principal executive offices are located at 422 East Vermijo Avenue, Suite 313, Colorado Springs, CO 80903. The telephone number at our principal executive offices is (719) 219-6404. Our web site is www.petroterracorp.com.

CURRENT BUSINESS OPERATIONS

The Company is an independent exploration and development company focused on the acquisition of property (or property leases enabling us to explore and exploit such property) that we believe may contain extractable oil and/or gas. We will seek to acquire property in the United States and will initially focus on properties in the Central Utah Thrust Belt, including the Utah Properties.

In order to determine whether to acquire a property, our management team will consider, among other things, whether oil and/or gas had previously been discovered at or near the property, whether the property is located atop a proven oil and natural gas basin and whether oil and/or gas has been exploited from the property. We will also review any materials that are made available to us by the owner of the property, including well logs, production records, and other seismic, geological and geophysical information. Additionally, we will compare analogues of successes and failures from seismic and drilling data in the region. Once we have completed our initial review, we will determine whether to acquire the property. Once we acquire a property (or the right to explore and exploit a property) we will conduct a full evaluation of the property, including, without limitation, obtaining an MHA Petroleum Consultants, LLC technical report (an “MHA Technical Report”). We expect that the cost of such an evaluation will be approximately $30,000. Using the data from the evaluation, and with the assistance of third party geophysicists, petroleum engineers, geologists and other third party technical consultants that we may hire, we will determine whether further exploration of the property should be undertaken. If management elects to continue the exploration of the property, we will conduct additional due diligence, including, but not limited to, potentially obtaining existing 2-D seismic lines on and around our properties and commencing an integrated geologic-geophysical evaluation and mapping effort. Following our due diligence analysis, management will determine if the Company should attempt to conduct its own 2-D or 3-D seismic coverage to evaluate the properties further. Thereafter, management will determine if the Company should attempt to extract oil and/or gas from the property. If management elects to do so, we will engage a separate third party to extract (whether by conventional means, horizontal drilling and/or fracturing) the oil and/or gas. We expect that recent improvements in drilling and fracturing methods will augment our ability to discover and extract oil and gas.

By utilizing this business model, we believe that we can reduce the risks involved in each exploration project. Specifically, we believe that by compartmentalizing each step of the extraction process we will be able to limit the costs associated with each project and maintain the flexibility to abandon any projects that management believes will not yield sufficient amounts of oil and/or gas.

We have only recently begun to implement our business plan. In January 2014 we hired a third party independent contractor to provide insight and to assist in the development of a plan regarding the exploration of any properties that we acquire. In March 2014, we engaged a third party independent contractor to provide geologic consulting services to the Company. In March 2014 we also obtained an MHA Technical Report on the Utah Properties. We expect to conduct a full evaluation of the Utah Properties by the fourth quarter of this fiscal year.

RESULTS OF OPERATIONS

Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue our operation.

We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

Three Month Period Ended September 30, 2014 Compared to the Three Month Period Ended September 30, 2013.

Our net loss for the three month period ended September 30, 2014 was $178,143 compared to a net loss of $1,500 during the three month period ended September 30, 2013 as the Company incurred consulting costs related to exploration of the Utah Properties and professional fees related to its public company requirements. During the three month periods ended September 30, 2014 and September 30, 2013, we did not generate any revenue.

Lease property and exploration costs

During the three month period ended September 30, 2014, we incurred an increase in lease property and exploration costs of $32,117 compared to the $0 in the prior year, consisting primarily of consulting costs for exploration studies, project consultant costs and annual rental costs. As the acquisition of the Leases was not initiated until November 2013, we did not incur any costs relating to lease property and exploration costs for the three month period ended September 30, 2013.

General and administrative costs

During the three month period ended September 30, 2014, we incurred general and administrative expenses of $42,274 compared to $1,500 incurred during the three month period ended September 30, 2013. The change in general and administrative expense incurred during the three months ended September 30, 2014 was primarily related to compensation to our Chief Executive Officer of $30,000, corporate overhead and travel costs.

Professional Fees

During the three months ended September 30, 2014, we incurred professional fees of $62,752 relating to our equity financings, the acquisition of the Leases from Ardmore and public company compliance. The legal and accounting fees associated with these activities amounted to $20,000 and $13,255, respectively, and the corporate and investor relations fees associated with these activities amounted to $29,497.

Non-Employee Stock Based Compensation

During the three month period ended September 30, 2014, we incurred $41,000 in stock based compensation charges for stock issuances for professional and advisory services. We did not incur any costs relating to stock based compensation during the three months ended September 30, 2014.

The weighted average number of shares outstanding was 64,522,597 and 53,024,000 for the three month periods ended September 30, 2014 and 2013, respectively.

Six Month Period Ended September 30, 2014 Compared to the Six Month Period Ended September 30, 2013.

Our net loss for the six month period ended September 30, 2014 was $266,937 compared to a net loss of $5,540 during the six month period ended September 30, 2013. The Company began implementing its business plan in November 2013 and the expenses incurred in the six month period ended September 30, 2014 are primarily attributable to exploration costs and professional fees related to its public company requirements. During the six month periods ended September 30, 2014 and September 30, 2013, we did not generate any revenue.

Lease property and exploration costs

During the six month period ended September 30, 2014, we incurred an increase in lease property and exploration costs of $48,947 compared to the $0 in the prior year, consisting primarily of consulting costs. As the acquisition of the Leases was not initiated until November 2013, we did not incur any costs relating to lease property and exploration costs for the six month period ended September 30, 2013.

General and administrative costs

During the six month period ended September 30, 2014, we incurred general and administrative expenses of $81,452 compared to $5,540 incurred during the six month period ended September 30, 2013. The change in general and administrative expense incurred during the six months ended September 30, 2014 was primarily related to compensation to our Chief Executive Officer of $60,000, corporate overhead and travel costs.

Professional Fees

During the six months ended September 30, 2014, we incurred professional fees of $95,538 relating to our equity financings, the acquisition of the Leases from Ardmore and public company compliance. The legal and accounting fees associated with these activities amounted to $45,436 and $19,465, respectively, and the corporate and investor relations fees associated with these activities amounted to $30,637.

Non-Employee Stock Based Compensation

During the six month period ended September 30, 2014, we incurred $41,000 in stock based compensation charges for stock issuances for professional and advisory services. We did not incur any costs relating to stock based compensation during the six months ended September 30, 2014.

The weighted average number of shares outstanding was 64,316,328 and 53,024,000 for the six month periods ended September 30, 2014 and 2013, respectively.

LIQUIDITY AND CAPITAL RESOURCES

Six month Period Ended September 30, 2014

As of September 30, 2014, the Company had assets worth $792,617 compared to $487,529 on March 31, 2014. Assets as of September 30, 2014 comprised of $22,878 in cash, $26,614 in fixed assets and website development costs and $737,500 for the Leases. As of September 30, 2014, our current liabilities were $83,704. Current liabilities were comprised of a $10,118 loan from our sole director and chief executive officer, $63,586 in accounts payable and accrued liabilities and $10,000 in accrued payroll.

Stockholders’ equity increased from $424,850 as of March 31, 2014 to $708,913 as of September 30, 2014. The $284,063 increase is due to the issuance of common stock for gross proceeds of $322,500 and the issuance of common stock for the land lease assignment rights installment of $187,500, services for common stock of $41,000 and is offset by losses for the six month period ending September 30, 2014 of $266,937.

Securities Purchase Agreement

On August 22, 2014, the Company entered into securities purchase agreements with an investor pursuant to Regulation S promulgated under the Securities Act, pursuant to which the Company sold an aggregate of 483,871 shares of the Company’s common stock for gross proceeds in the current period at $150,000.

On May 7, 2014 and March 6, 2014, the Company entered into securities purchase agreements with an investor pursuant to Regulation S promulgated under the Securities Act, pursuant to which the Company sold an aggregate of 200,000 and 100,000 shares of the Company’s common stock, respectively, for gross proceeds in the first quarter at $150,000 and $75,000. Of the $75,000 gross proceeds received for the issuance of 100,000 shares, $52,500 was received during the year ended March 31, 2014. The remaining $22,500 was received on April 24, 2014.

Cash Flows from Operating Activities

We have generated negative cash flows from operating activities. For the six month period ended September 30, 2014, net cash flows used in operating activities was $205,887 consisting of a net loss of $266,937, an increase of prepaids of $5,625 for annual dues, an increase of $24,543 in accounts payables and accrued liabilities related primarily to professional services and consulting fees, and a decrease of $5,000 for accrued salary – officer. For the six month period ended September 30, 2013, net cash flows used in operating activities was $0 consisting of a net loss of $5,540 decrease in accounts payable of $1,295 and an increase of $6,835 of related party loans paid directly to vendors on the Company’s behalf.

Cash Flows from Investing Activities

We have used cash from investing activities in the six month period ended September 30, 2014 for the land lease installment of $100,000 and the cost of certain computer equipment amounting to $2,772. There are no investing activities in the prior year period.

Cash Flows from Financing Activities

We have financed our operations primarily from either cash advances or the issuance of equity and debt instruments. We generated cash from financing activities of $322,500 in the six month period ended September 30, 2014,. We did not generate any cash through financing activities in the six month period ended September 30, 2013,

PLAN OF OPERATION AND FUNDING

We expect that our working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.

Existing working capital, further advances and debt instruments, and anticipated cash flow are not adequate to fund our operations over the next three months and the company is dependent upon additional equity raises. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of our private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) developmental expenses associated with a start-up business; and (ii) marketing expenses. We intend to finance these expenses with further issuances of securities and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current stockholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities which could significantly and materially restrict our business operations. We will have to raise additional funds in the next twelve months in order to sustain and expand our operations. 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 have and will continue to seek to obtain short-term loans from our director, although no future arrangement for additional loans has been made. We do not have any agreements with our director concerning these loans. We do not have any arrangements in place for any future equity financing.

OFF-BALANCE SHEET ARRANGEMENTS

As of the date of this Quarterly Report, we do not have any 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 are material to investors.

GOING CONCERN

The independent auditors’ report accompanying our March 31, 2014 financial statements contained an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

No report required.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management, consisting of our sole officer, carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Exchange Rule 13a-15(e)) as of September 30, 2014. Management recognizes that any disclosure controls and procedures no matter how well designed and operated, can only provide reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our management has reassessed the effectiveness of our disclosure controls and procedures and based upon that evaluation, our sole officer concluded that our disclosure controls and procedures were not effective as of September 30, 2014.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this Quarterly Report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties.

ITEM 1A. RISK FACTORS

No report required.

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

The Company has evaluated subsequent events from September 30, 2014 through the filing of these financial statements. There are no significant subsequent events, except as discussed below:

On October 24, 2014, the Company sold a total of 147,059 shares of common stock for gross proceeds of $50,000. Such sale was exempt from the registration requirements of the Securities Act pursuant to Regulation S promulgated under the Securities Act.

On September 2, 2014, the Company authorized the issuance of 50,000 shares of common stock to a third party entity for consulting services. Such issuance was exempt from registration pursuant to Section 4(a)(2) of the Securities Act.

On September 16, 2014, the Company authorized the issuance of 50,000 shares of common stock to the Company’s newly appointed Chief Operating Officer for consulting services. Such issuance was exempt from registration pursuant to Section 4(a)(2) of the Securities Act.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

No report required.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No report required.

ITEM 5. OTHER INFORMATION

No report required.

ITEM 6. EXHIBITS

* Filed Herewith

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.