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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q
 
x
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended November 30, 2011
   
 
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                                to                                                          

Commission File Number: 333-165995

Gemini Tea Corp.
(Exact name of small business issuer as specified in its charter)

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

13836 Parkland Blvd SE, Calgary, Alberta, Canada T2J 3X4
(Address of principal executive offices)

(403) 256-2066
(Issuer’s Telephone Number)
 
 
Indicate by check mark 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.  xYes  oNo

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 (ß232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   .  oYes  xNo

Indicate by check mark whether the registrant is a large accelerated file, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer
o
 
Accelerated filer
o
Non-accelerated filer       
o
(Do not check if a smaller reporting company)
Smaller reporting company
x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). xYes  oNo

As of January 6, 2012, there were 4,876,100 shares of the issuer $.0001 par value common stock issued and outstanding.
 
 
 

 

PART I - FINANCIAL INFORMATION
 
ITEM 1. FINANCIAL STATEMENTS

GEMINI TEA CORP.
(A Development Stage Company)
Balance Sheets
(Unaudited)
 
ASSETS
           
             
   
November 30,
   
February 28,
 
   
2011
   
2011
 
CURRENT ASSETS
           
             
Cash
  $ 14,852     $ 60,606  
 
               
TOTAL  ASSETS
  $ 14,852     $ 60,606  
                 
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
                 
                 
CURRENT LIABILITIES
               
                 
   Accounts Payable
  $ 225       -  
   Related Party Advances
  $ -     $ 515  
   Related Party loan payable
    -       15,000  
                 
TOTAL LIABILITIES
    225       15,515  
                 
STOCKHOLDERS’ DEFICIT
               
                 
   Common stock, $0.0001 par value, authorized 100,000,000
               
    shares: 4,876,100 shares issued and outstanding as of
    488       488  
    February 28, 2011 and November 30, 2011
               
   Additional Paid in Capital
    87,602       87,602  
   Deficit accumulated during the development stage
    (73,463 )     (42,999 )
                 
     Total Stockholders’ Equity
    14,627       45,091  
                 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
    14,852       60,606  
 
The accompanying notes are an integral part of these unaudited financial statements.
 
 
F-1

 
 
GEMINI TEA CORP.
(A Development Stage Company)
Statement of Expenses
Three and Nine Months Ended November 30, 2011 and 2010 and Period from
February 2, 2010 (Inception) through November 30, 2011
 (Unaudited)

                From Inception on February 2  
 
 
For the Three Months Ended
November 30
   
For the Nine Months Ended
November 30
    Through November 30  
   
2011
   
2010
   
2011
   
2010
   
2011
 
                               
OPERATING EXPENSES
                             
     General and administrative
  $ 3,290     $ 27,453     $ 30,464     $ 37,735     $ 73,463  
                                         
NET LOSS
    (3,290 )     (27,453 )     (30,464 )     (37,735 )     (73,463 )
                                         
BASIC AND FULLY DILUTED
                                       
   (LOSS) PER SHARE
  $ (0.00 )   $ (0.00 )   $ (0.01 )   $ (0.00 )     N/A  
                                         
WEIGHTED AVERAGE
                                       
NUMBER OF SHARES
                                       
OUTSTANDING
    4,260,663       4,200,933       4,260,663       4,066,491       N/A  

The accompanying notes are an integral part of these unaudited financial statements.
 
 
 
 
 
F-2

 
GEMINI TEA CORP.
(A Development Stage Company)
Statement of Cash Flows
Nine Months Ended November 30, 2011 and 2010 and Period from
February 2, 2010 (Inception) through November 30, 2011
 (Unaudited)
 
               
From Inception
 
   
For the
Nine Months
   
For the
Nine Months
    on February 22010 Through  
   
Ended
Nov 30, 2011
   
Ended
Nov 30, 2010
    November 30, 2011  
                   
                   
                   
                   
CASH FLOWS FROM OPERATING
                 
    ACTIVITIES
                 
                   
Net loss
  $ (30,464 )   $ (37,735 )   $ (73,463 )
Adjustments to reconcile net loss to net
                       
  cash used in operating activities:
    -       -       -  
Changes in operating assets and liabilities
                       
Accounts payable
    225       -        225  
Net Cash (Used in) Operating Activities
    (30,239 )     (37,735 )     (73,238 )
                         
CASH FLOWS FROM FINANCING
                       
    ACTIVITIES
                       
                         
   Proceeds from issuance of common stock
    -       52,652       88,090  
   Accounts payable – related party
    (515 )     -       -  
   Proceeds from related party loan
    (15,000 )     15,000       -  
                         
   Net Cash Provided by Financing Activities
    (15,515 )     67,652       88,090  
                         
NET INCREASE (DECREASE) IN CASH
    (45,754 )     29,917       14,852  
                         
Cash balance, beginning of period
    60,606       400       -  
                         
Cash balance, ending of period
  $ 14,852     $ 30,317     $ 14,852  

The accompanying notes are an integral part of these unaudited financial statements.
 
 
F-3

 
GEMINI TEA CORP.
(A Development Stage Company)
 Notes to the Financial Statements
November 30, 2011 and February 28, 2011
(Unaudited)



NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION

The financial statements presented are those of Gemini Tea Corp. (the Company). The accompanying unaudited financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted in accordance with such rules and regulations. The information furnished in the interim financial statements includes normal recurring adjustments and reflects all adjustments, which, in the opinion of management, are necessary for a fair presentation of such financial statements. Although management believes the disclosures and information presented are adequate to make the information not misleading, it is suggested that these interim financial statements be read in conjunction with the Company’s most recent audited financial statements. Operating results for the three and nine months ended November 30, 2011 are not necessarily indicative of the results that may be expected for the year ending February 28, 2012.

NOTE 2 - GOING CONCERN

The Company's financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company does not have significant cash or other material assets, nor does it have an established source of revenues sufficient  to cover its operating costs. Additionally, the Company has accumulated significant losses. All of these items raise substantial doubt about its ability to continue as a going concern.

NOTE 3 -   RELATED PARTY TRANSACTIONS

During the nine months ended November 30, 2011, the company paid $15,515 against advances and note payable to the officer. The note and advances were unsecured, bear no interest and were due on demand. Gemini Tea Corp. also uses the home of Wanda Canning as an office on a rent free basis.
 

 
F-4

 
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
 

This following information specifies certain forward-looking statements of management of the company. Forward-looking statements are statements that estimate the happening of future events and are not based on historical fact. Forward-looking statements may be identified by the use of forward-looking terminology, such as “may”, “shall”, “could”, “expect”, “estimate”, “anticipate”, “predict”, “probable”, “possible”, “should”, “continue”, or similar terms, variations of those terms or the negative of those terms. The forward-looking statements specified in the following information have been compiled by our management on the basis of assumptions made by management and considered by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guarantee or warranty is to be inferred from those forward-looking statements.

The assumptions used for purposes of the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. We cannot guarantee that any of the assumptions relating to the forward-looking statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.

Critical Accounting Policies and Estimates. Our Management’s Discussion and Analysis of Financial Condition and Results of Operations section discusses our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of our financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources.

The following discussion of our financial condition and results of operations should be read in conjunction with our audited financial statements for the year ended February 28, 2011, together with notes thereto as previously filed with our Annual Report on Form 10-K.  In addition, these accounting policies are described at relevant sections in this discussion and analysis and in the notes` to the financial statements included in our Quarterly Report on Form 10-Q for the period ended November 30, 2011.

Overview. The Company was incorporated in the State of Nevada on February 2, 2010. The Company remains in the development stage of its business of operating as a retailer/wholesaler of herbal, green, black and white teas and tea related accessories. The Company owns a website through which it intends to promote its products.
 
The Company is in the development stage and will continue to be in the development stage until the Company generates significant revenue from its business operations. The ability of the Company to emerge from the development stage with respect to its planned principal operations is dependent upon its ability to secure market acceptance of its business plan and to generate sufficient revenue through operations and/or raise additional funds.
 
There is no guarantee that the Company will be able to complete any of the above objectives and, even if it does accomplish certain objectives, there is no guarantee that the Company will attain profitability.
 
 
-2-

 
For the three and nine months ended November 30, 2011, as compared to the three and nine months ended November 30, 2010.
 
Results of Operations
 
Revenues. Since inception, we have yet to generate any revenues from our business operations. Our ability to generate revenues has been significantly hindered by our lack of capital. We hope to generate revenues as we implement our business plan.
 
Operating Expenses. For the nine months ended November 30, 2011 our total operating expenses were $30,464, as compared to total operating expenses of $37,735 for the nine months ended November 30, 2010. For the three months ended November 30, 2011 our total operating expenses were $3,290 as compared total operating expenses of $27,453 for the three months ended November 30, 2010. Our total operating expenses consist primarily of administrative expenses and accounting expenses related to being a public company. We expect that we will continue to incur significant administrative, legal and accounting expenses related to being a public company.
 
Net Loss. For the nine months ended November 30, 2011, our net loss was $30,464, as compared to the nine months ended November 30, 2010, in which our net loss was $37,735. For the three months ended November 30, 2011, our net loss was $3,290, as compared to the three months ended November 30, 2010, in which our net loss was $37,735. We expect to continue to incur net losses for the foreseeable future and until we generate significant revenues.
 
Liquidity and Capital Resources
 
We had cash of $14,852 as of November 30, 2011, which equals our total assets of $14,852 as of that date. We hope to obtain significant revenues from future sales of our products. We are also seeking to raise additional funds to meet our working capital needs principally through the sales of our securities.
 
As of November 30, 2011, our total liabilities were $225 consisting of accounts payable.
 
At inception, we sold 4,000,000 shares of common stock to our officers and director for $400 in cash. In 2010 and 2011, we sold an additional 876,100 shares of common stock through our public offering for proceeds of $87,690. We have used the proceeds from the cash raised in that offering to pay the legal and accounting costs of being a public company. We had hoped to use some of the proceeds to begin marketing and promoting our services but we have been unable to conduct marketing activities.
 
During 2011, we expect that the administrative, legal and accounting costs of being a public company will continue to impact our liquidity and we may need to obtain funds to pay those expenses. Other than the anticipated increases in administrative, legal and accounting costs due to the reporting requirements of being a reporting company, we are not aware of any other known trends, events or uncertainties, which may affect our future liquidity.
 
In the opinion of management, available funds will not satisfy our working capital requirements to operate at our intended level of activity for the next twelve months. Our forecast for the period for which our financial resources will be adequate to support our operations involves risks and uncertainties and actual results could fail as a result of a number of factors. In order to implement our business plan in the manner we envision, we will need to raise additional capital. We cannot guarantee that we will be able to raise additional funds. Moreover, in the event that we are able to raise additional funds, we cannot guarantee that additional funding will be available on favorable terms. In the event that we experience a shortfall in our capital, we hope that our officer, director and/or principal shareholders will contribute funds to pay for our expenses to achieve our objectives over the next twelve months, however, we cannot guarantee that they will do so.
 
Our auditors have questioned our ability to continue operations as a “going concern”. We hope to obtain revenues from future product sales. In the absence of product sales and profits, we will seek to raise additional funds to meet our working capital needs principally through additional sales of our securities.  However, we cannot guarantee that we will be able to obtain sufficient additional funds when needed, or that such funds, if available, will be obtainable on terms satisfactory to us. As a result, our auditors believe that substantial doubt exists about our ability to continue operations.

Plan of Operation
 
The following plan of operation should be read in conjunction with our unaudited consolidated financial statements and the notes thereto.
 
In order to commence sales of our products, we will need to accomplish the following milestones:
 
1.           Commence development of our website. We will need to raise additional funds to pay the cost of developing our website. The costs would be paid to the website production company that undertakes the work on our behalf. Website development, maintenance and upgrade is an ongoing matter that will continue during the life of our operations
 
 
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2.           Finalize our marketing plans. We expect that our marketing literature will focus on the benefits to be obtained from using our products. In order of priority, our marketing efforts will be directed toward the following activities: development and distribution of marketing literature; promotion of our website including arranging for website listings and industry analyst relations. We expect that any costs incurred will be directly attributed to the following:
 
           establishing and maintaining operations with industry analysts would be related to travel and communication;
 
•           advertising, which will include direct mail and email promotion; and
 
•           attendance and participation at industry events.
 
We will need to raise additional funds to pay the cost of implementing our marketing plans. The amount of funds allocated for marketing activity is limited by the amount of funds raised in our offering. Less funds available for marketing activity could negatively affect our ability to attract customers and, consequently, our ability to generate revenue would be negatively affected. Marketing is an ongoing matter that will continue during the life of our operations.
 
3.           Acquire equipment needed to begin operations. We do not intend to hire employees at this time. Our officer and director will handle our administrative duties.
 
If we are unable to attract customers to purchase our products, then we may have to suspend or cease operations. We intend to offer for sale teas and tea related accessories to retail and wholesale customers. As of the date of this filing, we have not secured any customers. If we cannot generate sufficient revenues to continue operations, we will suspend or cease operations. If we cease operations, we do not know what we will do and we do not have any plans to do anything else.
 
There is no historical financial information about us upon which to base an evaluation of our performance. We are in the development stage of our operations and have not generated any revenues. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns.
 
To become profitable and competitive, we have to sell our products. We have no assurance that, if needed, future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing shareholders.
 
We will not be conducting any product research or development. We do not expect to purchase any significant equipment. Further, we do not expect any changes in the number of employees. We hope to profitably sell our products.
 
To date, we have experienced significant difficulties in generating revenues and raising additional capital. We believe our inability to raise significant additional capital through debt or equity financings is due to various factors. We had hoped to market our services during the last three months. However, our ability to market our services has been negatively affected by our inability to raise significant capital and our inability to generate revenues. If we are not able to raise additional capital or generate revenues that cover our estimated operating costs, our business may ultimately fail.
 
As a result of our difficulties in generating revenues and raising additional capital, we also intend to explore acquiring smaller companies with complementary businesses. Accordingly, over the next three months, we intend to research potential opportunities for us to acquire smaller companies with complementary businesses to our business and other companies that may be interested in being acquired by us or entering into a joint venture agreement with us. As of the date of this report, we have not identified any potential acquisition or joint venture candidates. We cannot guarantee that we will acquire or enter into any joint venture with any third party, or that in the event that we acquire another entity, this acquisition will increase the value of our common stock. We hope to use our common stock as payment for any potential acquisitions
 
 
-4-

 
Off Balance Sheet Arrangements

We had no off balance sheet arrangements at November 30, 2011.
 
Item 3. Quantitative and Qualitative Disclosures about Market Risk
 
Not applicable.
 
Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures. We maintain controls and procedures designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. Based upon their evaluation of those controls and procedures performed as of November 30, 2011, the date of this report, our chief executive officer and principal financial officer concluded that our disclosure controls and procedures were ineffective.

Item 4(T). Controls and Procedures

Changes in internal controls. There were no changes in our internal control over financial reporting that occurred during the fiscal quarter covered by this report 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.

None.
 
Item 1A. Risk Factors.

Not applicable.

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

None.
 
Item 3.  Defaults Upon Senior Securities

None.

Item 4.  Submission of Matters to Vote of Security Holders

None.

Item 5.  Other Information

None.

Item 6.  Exhibits
 
31
Certification of Principal Executive Officer and Principal Financial Officer, pursuant to Rule 13a-14 and 15d-14 of the Securities Exchange Act of 1934
   
32
Certification of Principal Executive Officer and Principal Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 
-5-

 
 
 
SIGNATURES

In accordance with 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.
 
 
Gemini Tea Corp.,
a Nevada corporation
 
       
January 6, 2012
By:
/s/ Wanda Canning
 
 
 
Its:
Wanda Canning
President, Chief Executive Officer,
Chief Financial Officer, Secretary, Treasurer, Director (Principal Executive, Financial and Accounting Officer)
 
 


 
 
 
 
 
 
 
 
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