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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

 þ

Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the

quarterly period ended September 30, 2012

 o

Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the

transition period from

to

.

000-30695

(Commission file number)

ARVANA INC.

(Exact name of registrant as specified in its charter)

NEVADA

87-0618509

State or other jurisdiction of

(I.R.S. Employer

incorporation or organization

Identification No.)

90 Madison Street, Suite 701, Denver, Colorado 80206

(Address of principal executive offices) (Zip Code)

(303) 329-3008

(Registrant’s telephone number, including area code)

N/A

(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 þ   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 during the preceding 12 months (or for such shorter period that the registrant was required

to submit and post such files). Yes þ   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.

Large accelerated filer ¨  Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the

Exchange Act). Yes þ   No ¨

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest

practicable date: The number of shares outstanding of the issuer’s common stock, $0.001 par value (the

only class of voting stock), at November 12, 2012 was 885,130.

1



TABLE OF CONTENTS

PART 1- FINANCIAL INFORMATION

Item1.

Financial Statements:

3

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of

13

Operations

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

18

Item 4.

Controls and Procedures

18

PART II-OTHER INFORMATION

Item 1.

Legal Proceedings

20

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

20

Item 3.

Defaults Upon Senior Securities

20

Item 4.

Mine Safety Disclosures

20

Item 5.

Other Information

20

Item 6.

Exhibits

20

Signatures

21

2



ITEM 1.

FINANCIAL STATEMENTS

As used herein, the terms “Company,” “we,” “our,” “us,” “it,” and “its” refer to Arvana Inc., a Nevada

corporation and its wholly owned subsidiaries, unless otherwise indicated.  In the opinion of management,

the accompanying unaudited consolidated financial statements included in this Form 10-Q reflect all

adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results

of operations for the periods presented.  The results of operations for the periods presented are not

necessarily indicative of the results to be expected for the full year.

3



Arvana Inc.

(A Development Stage Company)

Condensed Consolidated Balance Sheets

September 30,

December 31,

2012

2011

ASSETS

(Unaudited)

(Audited)

Current asset

Cash

$

4,120

$

1,734

Total assets

$

4,120

$

1,734

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current liabilities

Accounts payable and accrued liabilities

$      989,533

$

695,550

Loans payable stockholders (Note 3)

624,596

604,930

Loans payable related party (Note 3)

34,428

118,833

Loans payable (Note 3)

145,171

44,833

Amounts due to related parties (Note 3 and 6)

450,432

516,719

Total current liabilities

2,244,160

1,980,865

Stockholders' deficiency

Common stock, $0.001 par value 5,000,000 shares authorized

885,130 shares issued and outstanding at

September 30, 2012 and at December 31, 2011 (Note 4)

885

885

Additional paid-in capital

21,166,619

21,166,619

Deficit

(22,705,422)

(22,705,422)

Deficit accumulated during the development stage

(698,786)

(437,877)

(2,236,704)

(1,975,795)

Less: Treasury stock - 2,085 common shares at

September 30, 2012 and at December 31, 2011

(3,336)

(3,336)

Total stockholders’ deficiency

(2,240,040)

(1,979,131)

Total liabilities and deficiency

$

4,120

$

1,734

Subsequent events (Note 7)

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

4



Arvana Inc.

(A Development Stage Company)

Condensed Consolidated Statements of Operations

For the Three and Nine Months Ended September 30, 2012 and 2011

(Unaudited)

Cumulative

Amounts from the

Beginning of the

Development

Three Months Ended

Nine Months Ended

Stage on

September 30,

September 30,

January 1, 2010 to

September 30,

2012

2011

2012

2011

2012

Operating expenses

General and administrative

$    70,349

$  82,119

$   210,940

$   224,391

$

615,092

Depreciation

-

-

-

-

103

Total operating expenses

70,349

82,119

210,940

224,391

615,195

Loss from operations

(70,349)

(82,119)

(210,940)

(224,391)

(615,195)

Interest expense

(11,861)

(11,504)

(35,279)

(34,489)

(123,981)

Foreign exchange gain (loss)

(32,235)

89,920

(14,690)

29,626

40,390

Net loss and comprehensive loss for

the period

$(114,445)

$    (3,703)

$ (260,909)

$ (229,254)     $    $

(698,786)

Per share information - basic and diluted:

Weighted average shares outstanding

885,130

1,012,576

885,130

1,044,104

Net loss per share

$

(0.13)

$    (0.01)

$

(0.29)    $

(0.22)

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

5



Arvana Inc.

(A Development Stage Company)

Condensed Consolidated Statements of Cash Flows

(Unaudited)

Cumulative

amounts from the

beginning of the

development stage

on

For the Nine Months Ended

January 1, 2010 to

September 30,

September 30,

2012

2011

2012

Cash flows from operating activities

Net loss for the period

$   (260,909)      $   (229,254)

$

(698,786)

Adjustments to reconcile net loss to net cash

used in operating activities:

Depreciation and amortization

-

-

103

Unrealized foreign exchange

10,938

(16,499)

(39,874)

Changes in operating assets and liabilities:

Accounts payable and accrued liabilities

38,705

46,906

145,027

Amounts due to related parties

178,225

162,299

476,961

Net cash used in operations

(33,041)

(36,548)

(116,569)

Cash flows from financing activities

Proceeds of loans payable stockholders

20,171

4,770

41,233

Proceeds of loans payable related parties

15,256

14,540

34,089

Proceeds of loans payable

-

19,080

44,833

Net cash provided by financing activities

35,427

38,390

120,155

Increase in cash

2,386

1,842

3,586

Cash, beginning of period

1,734

2,074

534

Cash, end of period

$

4,120      $

3,916

$

4,120

Supplementary information

Interest paid

$

-

$

-      $

-

Taxes paid

$

-      $

-      $

-

Transactions not involving cash

Decrease in accounts payable due to related

parties due to debt assignment

$

252,507     $

-

$

252,507

Decrease in loans payable due to related parties

due to debt assignment

$

100,000     $

-      $

100,000

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

6



Arvana Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements

September 30, 2012

(Unaudited)

1.

Nature of Business and Ability to Continue as a Going Concern

Arvana Inc. (“our”, “we”, ”us” and the “Company”) was incorporated under the laws of the State of

Nevada as Turinco, Inc. on September 16, 1977, with authorized common stock of 2,500 shares with a par

value of $0.25. On October 16, 1998, the authorized capital stock was increased to 100,000,000 common

shares with a par value of $0.001 and a forward common stock split of eight shares for each outstanding

share. In 2005, we completed another forward common stock split of nine shares for each outstanding

share. On July 24, 2006, the shareholders approved a change of the Company’s name from Turinco, Inc.

to Arvana Inc. On September 30, 2010, the authorized capital stock was decreased to 5,000,000 common

shares with a par value of $0.001 and effected a reverse split of one share for every twenty shares

outstanding.

These consolidated financial statements for the nine month period ended September 30, 2012 include the

accounts of the Company and its subsidiary Arvana Networks Inc. (including its wholly-owned

subsidiaries, Arvana Participaçōes S.A.  (Arvana Par) and Arvana Comunicações do Brasil S. A.

(“Arvana Com”)). The Company has ceased all operations in its subsidiary companies, and has written-

off or disposed of all assets in the subsidiary companies, consequently they are now all considered to be

inactive subsidiaries. As a result of this inactivity, the Company entered into a new development stage as

of January 1, 2010.

Our functional currency and reporting currency is the United States dollar (“US Dollar”) and the

accompanying condensed consolidated financial statements have been expressed in US Dollars.

These consolidated financial statements have been prepared on a going concern basis, which assumes the

realization of assets and settlement of liabilities in the normal course of business. For the nine month

period ended September 30, 2012, we incurred a loss from operations of $260,909. At September 30,

2012, we had a working capital deficiency of $2,240,040. These conditions raise substantial doubt about

our ability to continue as a going concern.

Accordingly, the Company will require continued financial support from its shareholders and creditors

until it is able to generate sufficient cash flow from operations on a sustained basis. There is substantial

doubt that the Company will be successful at achieving these results. Failure to obtain the ongoing

support of its shareholders and creditors may make the going concern basis of accounting inappropriate,

in which case the Company’s assets and liabilities would need to be recognized at their liquidation values.

These consolidated financial statements do not include any adjustments relating to the recoverability and

classification of recorded asset amounts and classification of liabilities that might arise from this

uncertainty.

7



Arvana Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements

September 30, 2012

(Unaudited)

2.

Summary of Significant Accounting Policies

Basis of presentation

We are in the process of evaluating business opportunities and have entered a new development stage as

of January 1, 2010 and present our financial statements in accordance with the Financial Accounting

Standards Board (“FASB”) Accounting Standards Codification (the “Codification” or “ASC”) Topic 915.

Our fiscal year end is December 31. The accompanying consolidated interim financial statements of

Arvana Inc. for the nine month periods ended September 30, 2012 and 2011, and for the cumulative

amounts from the beginning of the development stage on January 1, 2010, through September 30, 2012,

have been prepared in accordance with accounting principles generally accepted in the United States (“US

GAAP”) for financial information with the instructions to Form 10-Q and Regulation S-X. Although they

are unaudited, in the opinion of management, they include all adjustments, consisting only of normal

recurring items, necessary for a fair presentation. Results are not necessarily indicative of results which

may be achieved in the future. The consolidated interim financial statements and notes appearing in this

report should be read in conjunction with our consolidated audited financial statements and related notes

thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of

Operations, contained in the our Annual Report on Form 10-K for the fiscal year ended December 31,

2011, as filed with the Securities and Exchange Commission (the “SEC”) on April 13, 2012.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make

estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of

contingent assets and liabilities at the date of the financial statements and the reported revenues and

expenses during the reporting periods. Actual results could differ from those estimates.

Financial instruments

The  Company  uses  the  following  methods  and  assumptions  to  estimate  the  fair  value  of  each  class  of

financial instruments for which it is practicable to estimate such values:

Cash - the carrying amount approximates fair value because the amounts consist of cash held at a bank.

Accounts  payable  and  accrued  liabilities  and  loans  payable  to  -  the  carrying  amount  approximates  fair

value due to the short-term nature of the obligations.

8



Arvana Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements

September 30, 2012

(Unaudited)

2.

Summary of Significant Accounting Policies (continued)

Financial instruments (continued)

The estimated fair values of the Company's financial instruments as of September 30, 2012 and December

31, 2011 follows:

September 30,

December 31,

2012

2011

Carrying

Fair

Carrying

Fair

Amount

Value

Amount

Value

Cash

$4,120

$4,120

$1,734

$1,734

Accounts payable and accrued liabilities

989,533

989,533

695,550

695,550

Loans payable to stockholders

624,596

624,596

604,930

604,930

Loans payable to related party

34,428

34,428

118,833

118,833

Loans payable

145,171

145,171

44,833

44,833

Amounts due to related parties

450,432

450,432

516,719

516,719

The  following  table  presents  information  about  the  assets  that  are  measured  at  fair  value  on  a  recurring

basis  as  of  September  30,  2012,  and  indicates  the  fair  value  hierarchy  of  the  valuation  techniques  the

Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize

quoted prices (unadjusted) in active markets for identical assets. Fair values determined by Level  2 inputs

utilize  data  points  that  are  observable  such  as  quoted  prices,  interest  rates  and  yield  curves.  Fair  values

determined  by  Level  3  inputs  are  unobservable  data  points  for  the  asset  or  liability,  and  included

situations where there is little, if any, market activity for the asset:

Quoted

Significant

Prices

Other

Significant

September

in Active

Observable

Unobservable

30,

Markets

Inputs

Inputs

2012

(Level 1)

(Level 2)

(Level 3)

Assets:

Cash

$

4,120

$

4,120

$

$

The fair value of cash is determined through market, observable and corroborated sources.

9



Arvana Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements

September 30, 2012

(Unaudited)

2.

Summary of Significant Accounting Policies (continued)

Recent accounting pronouncements

We have reviewed all recently issued, but not yet effective, accounting pronouncements and do not

believe the future adoption of any such pronouncements may be expected to cause a material impact on

our financial condition or the results of our operations.

3.

Amounts Due to Related Parties and Loans Payable to Stockholders

From February, 2007 until September 30, 2012 the Company received a number of loans from

stockholders, related parties and unrelated third parties.  As of September 30, 2012 the Company had

received loans of $624,596 (Euro 225,000; CAD 72,300; $261,800) (December 31, 2011 - $604,930:

Euro 225,000; CAD 62,300; $251,800) from stockholders, loans of $34,428 (CAD 25,000; $9,000)

(December 31, 2011 – $118,833: CAD 10,000; $109,000) from a related party and loans of $145,171

(CAD 10,000; $ 135,000) (December 31, 2011 – $ 44,833: CAD 10,000; $35,000) from unrelated third

parties. All of the loans bear interest at 6% per annum.  The loans were made in 3 different currencies,

Euros, Canadian Dollars and US Dollars.  All amounts reflected on these consolidated financial

statements are expressed in US Dollars.  Repayment of the loans is due on closing of any future financing

arrangement by the Company.  The balance of accrued interest of $200,630 and $156,015 is included in

accounts payable and accrued expenses at September 30, 2012 and December 31, 2011, respectively.

Interest expense recognized on these loans was $35,279 for the nine months ended September 30, 2012,

compared to $34,489 for the nine months ended September 30, 2011.

At September 30, 2012 and December 31, 2011 the Company had amounts due to related parties of

$450,432 and $516,719, respectively.  This amount includes $136,100 at September 30, 2012 and

December 31, 2011, payable to two former directors and a current director for services rendered during

2007. This amount is to be paid part in cash and part in stock at a future date with the number of common

shares determined by the fair value of the shares on the settlement date. The amounts owing bear no

interest, are unsecured, and have no fixed terms of repayment.

4.

Common Stock

We have a stock option plan in place under which we are authorized to grant options to executive officers

and directors, employees and consultants enabling them to acquire up to 10% of our issued and

outstanding common stock. Under the plan, the exercise price of each option equals the market price of

our stock as calculated on the date of grant. The options can be granted for a maximum term of 10 years.

Vesting terms are determined at the time of grant.

At September 30, 2012 and December 31, 2011, there were no stock options outstanding.  No options

were granted, exercised or expired during the nine months ended September 30, 2012 and the year ended

December 31, 2011.

10



Arvana Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements

September 30, 2012

(Unaudited)

4.

Common Stock (continued)

At September 30, 2012 and December 31, 2011, there were no warrants outstanding.  No warrants were

granted, exercised or expired during the nine months ended September 30, 2012 and the year ended

December 31, 2011.

On September 30, 2010, the Company completed a common stock reverse split of one share for each

twenty shares outstanding. These consolidated financial statements have been prepared showing after

reverse stock split shares with a par value of $0.001.

On September 6, 2011, the Company cancelled 175,000 shares of its treasury stock of which cancellation

removed $175 from common stock and $279,825 from additional paid-in capital.

5.

Segmented Information

The Company has no reportable segments.

6.

Related Party Transactions

Other than amounts payable to related parties as disclosed below and in Note 3, the Company did not

have any other related party transactions for the periods ended September 30, 2012 and 2011.

Our chief executive officer and director has entered into a consulting arrangement on a month to month

basis that provides for a monthly fee of CAD 5,000. These amounts have been accrued and are currently

unpaid. As of September 30, 2012 our chief executive officer was owed $45,769 (CAD 45,000) for

services rendered as an officer.

Our chief financial officer and director has entered into a consulting agreement on a month to month basis

that provides for a monthly fee of $2,000. These amounts have been accrued and are currently unpaid. As

of September 30, 2012 our chief financial officer was owed $42,000 for services rendered as an officer.

Our chief executive officer and director entered into a debt assignment agreement effective January 1,

2012 with a corporation with a director in common and thereby assigned $199,150 (CAD 202,759) of

unpaid amounts payable.

Our chief executive officer and director entered into a debt assignment agreement effective January 1,

2012 with an unrelated third party and thereby assigned $53,357 of unpaid amounts payable and $100,000

of unpaid loans.

Our chief executive officer and director is owed $120,520 for unsecured non-interest bearing amounts due

on demand loaned to the Company as of September 30, 2012.

Our chief executive officer and a director is owed $34,428 for unsecured amounts bearing 6% interest due

on demand loaned to the Company as of September 30, 2012.

Our former officers are owed a total of $106,043 for their prior services rendered as officers.

11



Arvana Inc.

(A Development Stage Company)

Notes to Condensed Consolidated Financial Statements

September 30, 2012

(Unaudited)

6.

Related Party Transactions (continued)

A director of the Company is owed $60,000 as of September 30, 2012 for services rendered as a director

during 2007. Two former directors of the Company are owed $76,100 as of September 30, 2012 for

services rendered as directors during 2007.

7.

Subsequent Events

The Company evaluated its September 30, 2012 financial statements for subsequent events through the

date the financial statements were issued. The Company is not aware of any subsequent events which

would require recognition or disclosure in the financial statements.

12



Item 2.

Management's Discussion and Analysis of Financial Condition and Results of

Operations.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations and other

parts of this quarterly report contain forward-looking statements that involve risks and uncertainties.

Forward-looking statements can also be identified by words such as “anticipates,” “expects,” “believes,”

“plans,” “predicts,” and similar terms. Forward-looking statements are not guarantees of future

performance and our actual results may differ significantly from the results discussed in the forward-

looking statements. Factors that might cause such differences include but are not limited to those

discussed in the subsection entitled Forward-Looking Statements and Factors That May Affect Future

Results and Financial Condition below. The following discussion should be read in conjunction with our

financial statements and notes thereto included in this report. Our fiscal year end is December 31. All

information presented herein is based on the nine month periods ended September 30, 2012 and

September 30, 2011.

Overview

The Company is currently in the process of evaluating business opportunities having entered a new

development stage as of January 1, 2010. We can provide no assurance that we will be successful in

identifying suitable business opportunities, or if we are able to identify suitable business opportunities,

that we will be able to find an adequate source of financing to acquire any business or business assets, and

commence operations, or that those operations, if commenced, will be successful in generating profits.

Our Plan of Operations

The Company’s plan of operation over the next twelve months is to identify and acquire a suitable

business opportunity. However, we will not be able to pursue any new business opportunities that we

might identify without additional financing to provide for ongoing operations. Management is actively

seeking new financing to this end while we evaluate potential businesses.

We anticipate that in order to maintain operations while we evaluate new businesses the Company will

need additional debt or equity funding of $50,000 over the next twelve months since we had cash of

$4,120 and a working capital deficit of $2,240,040 as at September 30, 2012. Should we be successful in

identifying a new business opportunity the Company will require additional funding to evaluate and

prospectively acquire any given opportunity. The amount of such additional funding will depend on the

business and is not determinable at this time.

Other than shareholder loans, we do not believe that debt financing will be an attractive means of funding

additional phases of our business development as we do not have tangible assets to secure any debt

financing. Rather, we anticipate that additional funding will be in the form of equity financing from the

sale of our common stock. However, we do not have any financing arranged and we cannot provide

investors with any assurance that we will be able to obtain sufficient funding from the sale of our

common stock to fund our plan of operations. Accordingly, we will require continued financial support

from our shareholders and creditors until we are able to generate sufficient cash flow from operations on a

sustained basis.

13



Results of Operations

During the nine months ended September 30, 2012, the Company (i) sought out prospective business

opportunities; and (ii) satisfied continuous public disclosure requirements.

Our operations for the three months ended September 30, 2012 and 2011 are summarized below.

Nine Months

Nine Months

Ended

Ended

September 30, 2012

September 30, 2011

Expenses:

General and administration

$70,349

$82,119

Interest

11,861

11,504

Foreign exchange (gain) loss

32,235

(89,920)

Comprehensive Loss for the Period

$114,445

$3,703

Our operations for the nine months ended September 30, 2012 and 2011 are summarized below.

Nine Months

Nine Months

Ended

Ended

September 30, 2012

September 30, 2011

Expenses:

General and administration

$210,940

$224,391

Interest

35,279

34,489

Foreign exchange (gain) loss

14,690

(29,626)

Comprehensive Loss for the Period

$260,909

$229,254

Comprehensive loss for the period

For the period from January 1, 2010 to September 30, 2012, the Company recorded a net loss of

$698,786. The Company’s cumulative net losses are primarily due to costs associated with general and

administrative expenses. General and administrative costs include accounting costs, consulting fees,

professional fees, travel costs, project development expenses, due diligence costs and office operation

costs.

Net losses for the three months ended September 30, 2012 were $114,445 as compared to $3,703 for the

three months ended September 30, 2011. The increase in net losses over the comparative three month

periods can be attributed to a slight decline in general and administrative expenses and a significant loss

on unrealized foreign exchange in the current period over a gain in the prior period due to that portion of

our liabilities that are payable in foreign currencies and the corresponding changes in the value of those

foreign currencies.

14



Net losses for the nine months ended September 30, 2012 were $260,909 as compared to $229,254 for the

nine months ended September 30, 2011. The increase in net losses over the comparative nine month

periods can be attributed to a slight decline in general and administrative expenses and a significant loss

on unrealized foreign exchange in the current period over a gain in the prior period due to that portion of

our liabilities that are payable in foreign currencies and the corresponding changes in the value of those

foreign currencies.

We did not generate revenue during this period and expect to continue to incur losses over the next twelve

months at a rate comparable to the three and nine months presented here or until such time as a new

business opportunity that produces income is concluded.

Capital Expenditures

The Company expended no amounts on capital expenditures for the period from January 1, 2010, to

September 30, 2012.

Income Tax Expense (Benefit)

The Company has a prospective income tax benefit resulting from a net operating loss carry-forward and

start up costs that will offset any future operating profit.

Impact of Inflation

The Company believes that inflation has had a negligible effect on operations over the past three years.

Liquidity and Capital Resources

The Company is in the development stage and, since inception, has experienced significant changes in

liquidity, capital resources, and stockholders’ deficit.

The Company had current and total assets of $4,120 as of September 30, 2012, consisting solely of cash.

Current and total liabilities as of September 30, 2012 were $2,244,160 consisting of accounts payable and

accrued liabilities of $989,533, loans payable to stockholders of $624,596, loans payable to a related party

of $34,428, loans payable of $145,171 and amounts due to related parties of $450,432. The Company had

a working capital deficit of $2,240,040 and a net stockholders deficit of $2,240,040 as of September 30,

2012.

The Company had current and total assets of $1,734 as of December 31, 2011, consisting solely of cash.

Current and total liabilities of December 31, 2011 were $1,980,865 consisting of accounts payable and

accrued liabilities of $695,550, loans payable to stockholders of $604,930, loans payable to a related party

of $118,833, loans payable of $44,833 and amounts due to related parties of $516,719. The Company had

a working capital deficit of $1,979,131 and a net stockholders deficit of $1,979,131 as of December 31,

2011.

15



Cash Used in Operating Activities

Cash flow used in operating activities was $116,569 for the period from January 1, 2010, to September

30, 2012. Our cumulative cash flow used in operating activities was used on accounting, administration,

consulting, legal expenses and filing fees.

We used cash in operations in the amount of $33,041 during the nine months ended September 30, 2012

compared to $36,548 during the nine months ended September 30, 2011. The cash flow used in

operations during the nine months ended September 30, 2012 was attributable primarily to net losses due

to administration expenses and unrealized foreign exchange losses offset by accounts payable and accrued

liabilities, and amounts due to related parties. We expect to continue to use cash flow in operating

activities over the next twelve months or until such time as the Company can generate sufficient revenue

to transition away from net losses.

Cash Used in Investing Activities

Cash flow used in investing activities was $0 for the period from January 1, 2010, to September 30, 2012.

We do expect to use cash flow in investing activities in connection with the development or acquisition of

a suitable business opportunity. Until such time as such unidentified opportunity is concluded, we do not

expect to use cash flows in investing activities.

Cash Flows from Financing Activities

Cash flow provided from financing activities was $120,155 for the period from January 1, 2010, to

September 30, 2012.  Our cumulative cash flows from financing activities can be mainly attributed to

loans contributed by shareholders, related parties and unrelated parties.

Cash flow provided by financing activities for the nine months ended September 30, 2012 was $35,427 as

compared to $38,390 for the nine months ended September 30, 2011. The change in cash flow provided

from financing activities over the comparative nine month periods can be attributed to the timing

differences involved with the procurement of unsecured loans.  We expect to continue to use cash flow

provided by financing activities to raise additional funds to maintain operations and seek out suitable

business opportunities.

The Company’s current assets are insufficient to conduct its plan of operation over the next twelve (12)

months. We will have to seek at least $50,000 in debt or equity financing over the next twelve months to

maintain operations.  The Company has no current commitments or arrangements with respect to, or

immediate sources of this funding. Further, no assurances can be given that funding is available. The

Company’s shareholders are the most likely source of new funding in the form of loans or equity

placements though none have made any commitment for future investment and the Company has no

agreement formal or otherwise. The Company’s inability to obtain sufficient funding to maintain

operations will have a material adverse affect on its ability to fulfill its current plan of operation to search

for suitable business opportunities.

The Company does not intend to pay cash dividends in the foreseeable future.

The Company had no lines of credit or other bank financing arrangements as of September 30, 2012.

16



The Company had no commitments for future capital expenditures that were material at September 30,

2012.

The Company has no defined benefit plan or contractual commitment with any of its officers or directors.

The Company has no current plans for the purchase or sale of any plant or equipment.

The Company has no current plans to make any changes in the number of employees.

Off-Balance Sheet Arrangements

As of September 30, 2012, 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 are material to stockholders.

Critical Accounting Policies

In Note 2 to the audited financial statements for the years ended December 31, 2011 and 2010, included

in our Form 10-K, the Company discusses those accounting policies that are considered to be significant

in determining the results of operations and its financial position.  The Company believes that the

accounting principles utilized by it conform to accounting principles generally accepted in the United

States.

The preparation of financial statements requires Company management to make significant estimates and

judgments that affect the reported amounts of assets, liabilities, revenues and expenses. By their nature,

these judgments are subject to an inherent degree of uncertainty. On an on-going basis, the Company

evaluates estimates. The Company bases its estimates on historical experience and other facts and

circumstances that are believed to be reasonable, and the results form the basis for making judgments

about the carrying value of assets and liabilities.  The actual results may differ from these estimates under

different assumptions or conditions.

Future Financings

We anticipate continuing to rely on debt or equity sales of our shares of common stock in order to

continue to fund our business operations. There is no assurance that we will achieve any additional sales

of our equity securities or arrange for debt or other financing to fund our plan of operations.

Going Concern

Our auditors have expressed an opinion as to the Company’s ability to continue as a going concern as a

result of an accumulated deficit during the development stage of $437,877 and negative cash flows from

operating activities as of December 31, 2011.  The Company’s ability to continue as a going concern is

subject to the ability of the Company to realize a profit and /or obtain funding from outside sources.

Management’s plan to address the Company’s ability to continue as a going concern includes: (i)

obtaining funding from the private placement of debt or equity; and (ii) realizing revenues from its

prospective development or acquisition of a suitable business opportunity.  Management believes that it

will be able to obtain funding to allow the Company to remain a going concern through the methods

discussed above, though there can be no assurances that such methods will prove successful.

17



Forward-Looking Statements and Factors That May Affect Future Results and Financial Condition

The statements contained in the section titled Management’s Discussion and Analysis of Financial

Condition and Results of Operations and elsewhere in this current report, with the exception of historical

facts, are forward-looking statements. Forward-looking statements reflect our current expectations and

beliefs regarding our future results of operations, performance, and achievements. These statements are

subject to risks and uncertainties and are based upon assumptions and beliefs that may or may not

materialize. These statements include, but are not limited to, statements concerning:

    our anticipated financial performance and business plan;

    the sufficiency of existing capital resources;

    our ability to raise additional capital to fund cash requirements for future operations;

    uncertainties related to the Company’s future business prospects;

    our ability to generate revenues from future operations;

    the volatility of the stock market and;

    general economic conditions.

We wish to caution readers that our operating results are subject to various risks and uncertainties that

could cause our actual results to differ materially from those discussed or anticipated. We also wish to

advise readers not to place any undue reliance on the forward-looking statements contained in this report,

which reflect our beliefs and expectations only as of the date of this report. We assume no obligation to

update or revise these forward-looking statements to reflect new events or circumstances or any changes

in our beliefs or expectations, other than as required by law.

Stock-Based Compensation

We have adopted Accounting Standards Codification Topic (“ASC”) 718, Share-Based Payment, which

addresses the accounting for stock-based payment transactions in which an enterprise receives employee

services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair

value of the enterprise’s equity instruments or that may be settled by the issuance of such equity

instruments.  We account for equity instruments issued in exchange for the receipt of goods or services

from other than employees in accordance with ASC 505. Costs are measured at the estimated fair market

value of the consideration received or the estimated fair value of the equity instruments issued, whichever

is more reliably measurable. The value of equity instruments issued for consideration other than employee

services is determined on the earliest of a performance commitment or completion of performance by the

provider of goods or services.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Not required.

Item 4.

Controls and Procedures

Disclosure Controls and Procedures

In connection with the preparation of this report on Form 10-Q, an evaluation was carried out by the

Company’s management, with the participation of the chief executive officer and chief financial officer,

of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e)

and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”)). Disclosure controls and

procedures are designed to ensure that information required to be disclosed in reports filed or submitted

18



under the Exchange Act is recorded, processed, summarized, and reported within the time periods

specified in the Commission’s rules and forms and that such information is accumulated and

communicated to management, including the chief executive officer and chief financial officer, to allow

timely decisions regarding required disclosures.

Based on that evaluation, the Company’s management concluded, as of the end of the period covered by

this report, that the Company’s disclosure controls and procedures were ineffective in recording,

processing, summarizing, and reporting information required to be disclosed, within the time periods

specified in the Commission’s rules and forms.

Changes in Internal Control over Financial Reporting

There have been no changes in internal control over financial reporting (as defined in Rule 13a-15(f) of

the Exchange Act) during the period ended September 30, 2012, that materially affected, or are

reasonably likely to materially affect, the Company’s internal control over financial reporting.

19



PART II

Item 1.

Legal Proceedings.

None

Item 1A.

Risk Factors

Not required.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3.

Defaults Upon Senior Securities

None.

Item 4.

Mine Safety Disclosures

Not applicable.

Item 5.

Other Information

None.

Item 6.

Exhibits

Exhibits required to be attached by Item 601 of Regulation S-K are listed in the Index to Exhibits on page

19 of this Form 10-Q, and are incorporated herein by this reference.

20



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this

report to be signed on its behalf by the undersigned thereunto duly authorized.

ARVANA INC.

By:

              /s/ Zahir Dhanani

Zahir Dhanani, Chief Executive Officer

Date:  November 13, 2012

By:     /s/ Arnold Tinter

Arnold Tinter, Chief Financial Officer,

Principal Accounting Officer

Date:  November 13, 2012

21



INDEX TO EXHIBITS

Exhibit

Number

Description of Exhibit

2.1

Agreement and Plan of Reorganization between the Company, Arvana Networks, Inc.

and the Shareholders of Arvana Networks, Inc. dated August 18, 2005(1)

3.1

Articles of Incorporation(2)

3.2

Bylaws, as amended(2)

3.3

Amendment to Articles of Incorporation(3)

10.1

2006 Stock Option Plan, dated June 5, 2006(4)

31.1

Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Exchange

Act(5)

31.2

Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act(5)

32.1

Certification of Chief Executive Officer pursuant to Rule 13a-14(b) of the Exchange Act

and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley

Act of 2002(5)

32.2

Certification of Chief Financial Officer pursuant to Rule 13a-14(b) of the Exchange Act

and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley

Act of 2002(5)

101. INS

XBRL Instance Document

101. PRE

XBRL Taxonomy Extension Presentation Linkbase

101. LAB

XBRL Taxonomy Extension Label Linkbase

101. DEF

XBRL Taxonomy Extension Label Linkbase

101. CAL

XBRL Taxonomy Extension Label Linkbase

101. SCH

XBRL Taxonomy Extension Schema

(1)

Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K

filed with the SEC on August 19, 2005.

(2)

Incorporated by reference to the exhibits to the Company’s registration statement on

Form 10-SB filed with the SEC on May 24, 2000.

(3)

Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K

filed with the SEC on October 12, 2010.

(4)

Incorporated by reference to the exhibits to the Company’s Current Report on Form 8-K

filed with the SEC on June 7, 2006.

(5)

Filed as an exhibit to this Quarterly Report on Form 10-Q.

Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed

“furnished” and not “filed” or part of a registration statement or prospectus for purposes

of Section 11 or 12 of the Securities Act of 1933, or deemed “furnished” and not “filed”

for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise is

not subject to liability under these sections.

22