Attached files

file filename
EXCEL - IDEA: XBRL DOCUMENT - SARA CREEK GOLD CORP.Financial_Report.xls
EX-32.1 - EXHIBIT 32.1 - SARA CREEK GOLD CORP.ex32_1.htm
EX-31.1 - EXHIBIT 31.1 - SARA CREEK GOLD CORP.ex31_1.htm


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q

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

For the quarterly period ended November 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 _______

Commission File No. 000-52892

Sara Creek Gold Corp.
(Exact name of registrant as specified in its charter)

Nevada
98-0511130
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)

7582 Las Vegas Boulevard South #247
Las Vegas, Nevada
 
89123
(Address of principal executive offices)
(Zip Code)

Registrant’s telephone number, including area code: (702) 664-1246

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 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.
ý Yes           o 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).
ý Yes          o No (Not required)

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 o
Accelerated filer o
Non-accelerated filer o
Smaller reporting company ý

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

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date:  10,281,985 shares of common stock as of January 9, 2013
 


 
1

 
 
SARA CREEK GOLD CORP.
FOR THE FISCAL QUARTER ENDED
NOVEMBER 30, 2012

INDEX TO FORM 10-Q
 
PART I
 
Page
     
Item 1
Financial Statements (Unaudited)                                                                                                                                
3
Item 2
Management’s Discussion and Analysis of Financial Condition and
Results of Operations                                                                                                                                
13
Item 3
Quantitative and Qualitative Disclosures About Market Risk                                                                                                                                
15
Item 4
Controls and Procedures                                                                                                                                
16
     
PART II
   
     
Item 1
Legal Proceedings                                                                                                                                
 17
Item 1A
Risk Factors                                                                                                                                
 17
Item 2
Unregistered Sales of Equity Securities and Use of Proceeds                                                                                                                                
 17
Item 3
Defaults Upon Senior Securities                                                                                                                                
 18
Item 4
Mine Safety Disclosures                                                                                                                                
 18
Item 5
Other Information                                                                                                                                
 18
Item 6
Exhibits                                                                                                                                
 18
 
Signatures                                                                                                                                
 19
 
 
 
 
 
 
 
2

 

PART I

Item 1
Financial Statements
 
SARA CREEK GOLD CORP.
 
(AN EXPLORATION STAGE COMPANY)
 
BALANCE SHEETS
 
             
             
             
   
November 30, 2012
   
August 31, 2012
 
 ASSETS
 
(Unaudited)
       
             
Current assets
           
Cash
  $ 35,119     $ 15,942  
Total current assets
    35,119       15,942  
                 
Total assets
  $ 35,119     $ 15,942  
                 
                 
 LIABILITIES AND STOCKHOLDERS' DEFICIT
               
                 
Current liabilities
               
Accounts payable
  $ 53,803     $ 57,407  
Notes payable
    13,966       13,966  
Total current liabilities
    67,769       71,373  
                 
Total liabilities
    67,769       71,373  
                 
Commitments and contingencies
               
                 
Stockholders' deficit
               
Common stock; $0.001 par value; 750,000,000
               
shares authorized, 10,281,985 and 9,281,985
               
shares issued and outstanding, respectively
    10,282       9,282  
Common stock payable
    -       300  
Additional paid in capital
    716,620       682,320  
Accumulated deficit
    (759,552 )     (747,333 )
Total stockholders' deficit
    (32,650 )     (55,431 )
                 
Total liabilities and stockholders' deficit
  $ 35,119     $ 15,942  

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

 
 
SARA CREEK GOLD CORP.
 
(AN EXPLORATION STAGE COMPANY)
 
STATEMENTS OF OPERATIONS
 
UNAUDITED
 
                   
                   
         
From June 12, 2006
 
   
For the Three Months Ended
   
(Inception) to
 
   
November 30, 2012
   
November 30, 2011
   
November 30, 2012
 
                   
Operating expenses
                 
General and administrative
  $ 12,219     $ 7,898     $ 750,493  
Total operating expenses
    12,219       7,898       750,493  
                         
Loss from operations
    (12,219 )     (7,898 )     (750,493 )
                         
Other expense
                       
Interest expense
    -       (1,771 )     (9,059 )
Total other expense
    -       (1,771 )     (9,059 )
                         
Loss from operations before income taxes
    (12,219 )     (9,669 )     (759,552 )
Provision for income taxes
    -       -       -  
Net loss
  $ (12,219 )   $ (9,669 )   $ (759,552 )
                         
Net loss per common share - basic and diluted
  $ (0.00 )   $ (0.00 )   $ (0.32 )
                         
Weighted average common shares outstanding -
                       
basic and diluted
    9,763,304       3,166,977       2,399,109  

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

 
4

 

SARA CREEK GOLD CORP.
 
(AN EXPLORATION STAGE COMPANY)
 
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
 
                                                 
                                                 
                                                 
         
 
               
Stock
               
Total
 
   
Common Stock
   
Common Stock Payable
   
Subscription
   
Additional
   
Accumulated
   
Stockholders'
 
   
Shares
   
Amount
   
Shares
   
Amount
   
Receivable
   
Paid-in Capital
   
Deficit
   
Equity (Deficit)
 
Balance, June 12, 2006 (Inception)
    -     $ -       -     $ -     $ -     $ -     $ -     $ -  
                                                                 
Issuance of stock at $0.001 per share
    1,000,000       1,000       -       -       (10,000 )     9,000       -       -  
                                                                 
Net loss
    -       -       -       -       -       -       (1,230 )     (1,230 )
                                                                 
Balance, August 31, 2006
    1,000,000       1,000       -       -       (10,000 )     9,000       (1,230 )     (1,230 )
                                                                 
Receipt of stock subscription receivable
    -       -       -       -       10,000       -       -       10,000  
                                                                 
Net loss
    -       -       -       -       -       -       (5,855 )     (5,855 )
                                                                 
Balance, August 31, 2007
    1,000,000       1,000       -       -       -       9,000       (7,085 )     2,915  
                                                                 
Issuance of stock pursuant to a private
                                                               
    placement at $0.10 per share
    490,000       490       -       -       -       48,510       -       49,000  
                                                                 
Net loss
    -       -       -       -       -       -       (58,567 )     (58,567 )
                                                                 
Balance, August 31, 2008
    1,490,000       1,490       -       -       -       57,510       (65,652 )     (6,652 )
                                                                 
Net loss
    -       -       -       -       -       -       (30,806 )     (30,806 )
                                                                 
Balance, August 31, 2009
    1,490,000       1,490       -       -       -       57,510       (96,458 )     (37,458 )
                                                                 
Net loss
    -       -       -       -       -       -       (513,721 )     (513,721 )
                                                                 
Balance, August 31, 2010
    1,490,000       1,490       -       -       -       57,510       (610,179 )     (551,179 )
                                                                 
Issuance of common stock in exchange
                                                               
    for debt at $0.30 per share
    1,676,977       1,677       -       -       -       501,416       -       503,093  
                                                                 
Net loss
    -       -       -       -       -       -       (72,794 )     (72,794 )
                                                                 
Balance, August 31, 2011
    3,166,977       3,167       -       -       -       558,926       (682,973 )     (120,880 )
                                                                 
Adjustment for rounding differences
    8       -       -       -       -       -       -       -  
                                                                 
Issuance of common stock in exchange
                                                               
    for debt at $0.01 per share
    5,000,000       5,000       -       -       -       45,000       -       50,000  
                                                                 
Issuance of common stock in exchange
                                                               
    for debt at $0.05 per share
    600,000       600       -       -       -       29,400       -       30,000  
                                                                 
Accrued interest waived by stockholders
    -       -       -       -       -       9,059       -       9,059  
                                                                 
Issuance of common stock in exchange
                                                               
    for services rendered at $0.05 per share
    515,000       515       -       -       -       25,235       -       25,750  
                                                                 
Issuance of common stock in exchange
                                                               
    for cash at $0.05 per share
    -       -       300,000       300       -       14,700       -       15,000  
                                                                 
Net loss
    -       -       -       -       -       -       (64,360 )     (64,360 )
                                                                 
Balance, August 31, 2012
    9,281,985       9,282       300,000       300       -       682,320       (747,333 )     (55,431 )
                                                                 
Issuance of common stock in exchange
                                                               
    for cash at $0.05 per share
    1,000,000       1,000       (300,000 )     (300 )     -       34,300       -       35,000  
                                                                 
Net loss
    -       -       -       -       -       -       (12,219 )     (12,219 )
                                                                 
Balance, November 30, 2012 (Unaudited)
    10,281,985     $ 10,282       -     $ -     $ -     $ 716,620     $ (759,552 )   $ (32,650 )
 
The accompanying notes are an integral part of these financial statements.

 
5

 

SARA CREEK GOLD CORP.
 
(AN EXPLORATION STAGE COMPANY)
 
STATEMENTS OF CASH FLOWS
 
UNAUDITED
 
                   
                   
         
From June 12, 2006
 
   
For the Three Months Ended
   
(Inception) to
 
   
November 30, 2012
   
November 30, 2011
   
November 30, 2012
 
                   
Cash flows from operating activities:
                 
Net loss
  $ (12,219 )   $ (9,669 )   $ (759,552 )
Adjustments to reconcile net loss to net
                       
cash used by operating activities:
                       
Loss on settlement of debt
    -       -       432,894  
Accrued interest on notes payable
    -       1,771       9,059  
Issuance of common stock for services
    -       -       25,750  
Changes in operating assets and liabilities:
                       
Accounts payable
    (3,604 )     (142 )     53,803  
Net cash used by operating activities
    (15,823 )     (8,040 )     (238,046 )
                         
Cash flows from investing activities:
                       
Notes receivable, net
    -       -       (432,894 )
Net cash used by investing activities
    -       -       (432,894 )
                         
Cash flows from financing activities:
                       
Proceeds from notes payable
    -       25,000       618,414  
Repayment of notes payable
    -       -       (21,355 )
Issuance of common stock for cash
    35,000       -       109,000  
Net cash provided by financing activities
    35,000       25,000       706,059  
                         
Net change in cash
    19,177       16,960       35,119  
                         
Cash, beginning of period
    15,942       1,458       -  
                         
Cash, end of period
  $ 35,119     $ 18,418     $ 35,119  
                         
Supplemental disclosure of cash flow information:
                       
Interest paid
  $ -     $ -     $ -  
Taxes paid
  $ -     $ -     $ -  
                         
Supplemental disclosure of non-cash financing activity
                       
Stock issued in exchange for debt
  $ -     $ -     $ 583,093  
                         
Accrued interest waived by stockholders
  $ -     $ -     $ 9,059  

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

 
6

 
 
SARA CREEK GOLD CORP.
(A EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2012
UNAUDITED
 

1.           DESCRIPTION OF BUSINESS

Sara Creek Gold Corp. (“the Company”) was incorporated under the laws of the State of Nevada on June 12, 2006, under the name of Uventus Technologies Corp.  On September 23, 2009, the Company merged with its wholly owned subsidiary and changed its name to Sara Creek Gold Corp. to better reflect its business plan which is the acquisition, exploration, and development of gold and other mineral resource properties.

2.           SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting - The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim financial information.

The unaudited interim financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K, which contains the audited financial statements and notes thereto, together with the Plan of Operations for the year ended August 31, 2012.

Certain information or footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted, pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial reporting.  Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, or cash flows.  It is management's opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation.  The interim results for the three months ended November 30, 2012 are not necessarily indicative of results for the full fiscal year.

Year-End - The Company has selected August 31 as its year end.

Exploration Stage Company - The Company’s financial statements are presented as a company in the exploration stage of business.  Activities during the exploration stage primarily include implementation of the business plan and obtaining debt and/or equity related financing.

Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from those estimates.
 
 
7

 
 
SARA CREEK GOLD CORP.
(A EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2012
UNAUDITED
 
 
Cash - Cash and cash equivalents consist primarily of cash on deposit, certificates of deposit, money market accounts, and investment grade commercial paper that are readily convertible into cash and purchased with original maturities of three months or less.

The Company maintains cash balances at an institution that is insured by the Federal Deposit Insurance Corporation.  As of November 30, 2012 and 2011 no amounts were in excess of the federally insured program, respectively.

Revenue Recognition Policy - The Company will recognize revenue once all of the following criteria for revenue recognition have been met: pervasive evidence that an agreement exists; the product or service has been rendered; the fee is fixed and determinable based on the completion of stated terms and conditions; and collection of the amount due is reasonably assured.  The Company did not realize any revenues from June 12, 2006 (inception) through November 30, 2012.

Income Taxes - Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are determined based on temporary differences between the bases of certain assets and liabilities for income tax and financial reporting purposes.  The deferred tax assets and liabilities are classified according to the financial statement classification of the assets and liabilities generating the differences.
 
The Company maintains a valuation allowance with respect to deferred tax assets.  The Company establishes a valuation allowance based upon the potential likelihood of realizing the deferred tax asset and taking into consideration the Company’s financial position and results of operations for the current period.  Future realization of the deferred tax benefit depends on the existence of sufficient taxable income within the carry forward period under the Federal tax laws.

Changes in circumstances, such as the Company generating taxable income, could cause a change in judgment about the realizability of the related deferred tax asset.  Any change in the valuation allowance will be included in income in the year of the change in estimate.

Fair Value of Financial Instruments - The Company discloses, when reasonably attainable, the fair market values of its assets and liabilities which are deemed to be financial instruments.  As of November 30, 2012 and August 31, 2012 the carrying amounts and estimated fair values of the Company’s financial instruments approximate their fair value due to the short-term nature of such financial instruments, respectively.

Dividends - The payment of dividends by the Company in the future will be at the discretion of the Board of Directors and will depend on our earnings, capital requirements and financial condition, as well as other relevant factors.  
 
 
8

 

SARA CREEK GOLD CORP.
(A EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2012
UNAUDITED


Earnings (Loss) per Share - Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during each period.  Diluted earnings (loss) per share is computed by dividing net income (loss), adjusted for changes in income or loss that resulted from the assumed conversion of convertible shares, by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.

The computation of basic and diluted loss per share for the periods presented is equivalent since the Company had continuing losses. The Company had no common stock equivalents as of November 30, 2012 and 2011, respectively.

Risks and Uncertainties - The Company’s operations and future are dependent in a large part on its ability to locate economically developable deposits of precious metals.  The Company’s inability to locate and extract precious metals may have a material adverse effect on its financial condition, results of operations and cash flows.

New Accounting Pronouncements - There are no recent accounting pronouncements that are expected to have a material effect on the Company’s financial statements.

3.           GOING CONCERN

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As of November 30, 2012, the Company had total current assets of $35,119 and a working capital deficit in the amount of $32,650. The Company incurred a net loss of $12,219 during the three months ended November 30, 2012 and an accumulated net loss of $759,552 since inception.  The Company has not earned any revenues since inception and its cash resources are insufficient to meet its planned business objectives.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern. These financial statements do not include adjustments relating to the recoverability and classification of reported asset amounts or the amount and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to obtain additional financing or sale of its common stock as may be required and ultimately to attain profitability.

Management’s plan in this regard, is to raise capital through a combination of equity and debt financing sufficient to finance the continuing operations for the next twelve months.  However, there can be no assurance that the Company will be successful in raising such financing.  As an alternative, the Company may be amenable to a sale, merger, or other acquisition in the event such transaction is deemed by management to be in the best interests of the shareholders.
 
 
9

 

SARA CREEK GOLD CORP.
(A EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2012
UNAUDITED
 
 
4.           NOTES RECEIVABLE AND BAD DEBT EXPENSE

On January 20, 2010, the Company entered into a loan agreement with Kapelka Exploration, Inc. (“Kapelka”).  Under the terms of the loan agreement the Company agreed to provide Kapelka with cash advances of up to $500,000 for general operating purposes. Any funds advanced under the loan were non-interest bearing and were to be repaid to the Company no later than December 31, 2015.  On January 20, 2011 the Company’s Board of Directors resolved to forgive accumulated advances of $401,452 indebted to the Company and recorded the loss to bad debt expense.

On February 3, 2010 the Company entered into a memorandum of understanding with Ophir Exploration Inc. (“Ophir”) and advanced $30,000 at an interest rate of 5% per annum.  On January 28, 2011 the Company’s Board of Directors resolved to forgive the $30,000 indebted to the Company, together with accrued interest in the amount of $1,442, and recorded the loss to bad debt expense.

Bad debt expense for the three months ended November 30, 2012 and 2011 totaled $0 and $0, respectively.

5.           NOTES PAYABLE

As of November 30, 2012 and 2011 there was a balance due to a stockholder in the amount of $13,966.  This balance is unsecured, non-interest bearing and has no specific terms of repayment.

As of August 31, 2010, the Company received advances from an unrelated party totaling $488,093.   During the six months ended February 28, 2011, the Company received an additional $15,000 for an accumulative balance of $503,093.  These advances were non-interest bearing, unsecured, and due on demand.  On February 8, 2011, the outstanding debt of $503,093 was exchanged for 1,676,977 shares of common stock at $0.30 per share.  Therefore, as of November 30, and August 31, 2012, the balance together with accrued interest totaled $0.  There was no gain or loss recorded on the conversion of the debt.

On November 18, 2010 the Company entered into an unsecured promissory note in the amount of $50,000. The note bears interest of 10% per annum and was due on December 31, 2011.  On April 19, 2012, the outstanding principle of $50,000 was exchanged for 5,000,000 shares of common stock at $0.01 per share.  Upon conversion, the note holder elected to waive accrued interest totaling $7,096 which is presented as a contribution on the statement of stockholders’ deficit.  As of November 30, and August 31, 2012, the balance together with accrued interest totaled $0 and $53,918, respectively.
 
 
10

 

SARA CREEK GOLD CORP.
(A EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2012
UNAUDITED
 
 
On August 25, 2011 the Company entered into an unsecured promissory note in the amount of $5,000. The note bears interest of 10% per annum and is due on August 24, 2012.  On May 22, 2012, the outstanding principle of $5,000 was exchanged for 100,000 shares of common stock at $0.05 per share.  Upon conversion, the note holder elected to waive accrued interest totaling $371 which is presented as a contribution on the statement of stockholders’ deficit.  As of August 31, 2012 and 2011, the balance together with accrued interest totaled $0 and $5,008, respectively.

On September 20, 2011 the Company entered into two unsecured promissory notes for a total amount of $10,000. The notes bear interest of 10% per annum and are due on September 19, 2012.  On May 22, 2012, the outstanding principle of $10,000 was exchanged for 200,000 shares of common stock at $0.05 per share.  Upon conversion, the note holder elected to waive accrued interest totaling $671 which is presented as a contribution on the statement of stockholders’ deficit.  As of August 31, 2012 and 2011, the balance together with accrued interest totaled $0.

On October 11, 2011 the Company entered into an unsecured promissory note in the amount of $15,000. The note bears interest of 10% per annum and is due on October 10, 2012.  On May 22, 2012, the outstanding principle of $15,000 was exchanged for 300,000 shares of common stock at $0.05 per share.  Upon conversion, the note holder elected to waive accrued interest totaling $921 which is presented as a contribution on the statement of stockholders’ deficit.  As of August 31, 2012 and 2011, the balance together with accrued interest totaled $0.

6.           STOCKHOLDERS’ EQUITY (DEFICIT)

On September 23, 2009, the Company affected a 15 for 1 forward stock split of its authorized, issued, and outstanding common stock.

On February 8, 2011, the Company affected a 30 for 1 reverse stock split of its authorized, issued, and outstanding common stock.

The accompanying financial statements have been adjusted to reflect the forward and reverse stock splits, retroactively.

Year Ended August 31, 2006

On June 12, 2006, the Company issued 1,000,000 shares of its par value common stock to various directors at $0.001 per share for a subscription receivable of $10,000, which was received in 2007.

Year Ended August 31, 2008

On February 14, 2008, the Company issued 490,000 shares of its par value common stock pursuant to a private placement at $0.10 per share for gross proceeds in the amount of $49,000.
 
 
11

 

SARA CREEK GOLD CORP.
(A EXPLORATION STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2012
UNAUDITED


Year Ended August 31, 2011

On February 8, 2011, the Company issued 1,676,977 shares of its par value common stock in exchange for outstanding debt in the amount of $503,093 at $0.30 per share.

Year Ended August 31, 2012

On April 19, 2012, the Company issued 5,000,000 shares of its par value common stock in exchange for outstanding debt in the amount of $50,000 at $0.01 per share.

On May 22, 2012, the Company issued 600,000 shares of its par value common stock in exchange for outstanding debt in the amount of $30,000 at $0.05 per share.

Upon conversion of $80,000 in debt, the note holders elected to waive accrued interest totaling $9,059 which is presented as a contribution on the statement of stockholders’ deficit.  See also Note 5 regarding notes payable.

On August 14, 2012, the Company issued 515,000 shares of its par value common stock in exchange for services rendered in the amount of $25,750 at $0.05 per share.

On August 31, 2012, the Company received gross proceeds in the amount of $15,000 for 300,000 shares of its par value common stock at $0.05 per share.  As of August 31, 2012, the shares had not been issued and are recorded as common stock payable.

Three Months Ended November 30, 2012

On September 10, 2012 the Company issued 700,000 shares of its par value common stock in exchange for cash at $0.05 per share for gross proceeds in the amount of $35,000.  In addition, the Company issued 300,000 shares which had been recorded to common stock payable as of August 31, 2012.

7.           LEGAL PROCEEDINGS

On November 10, 2011, a claim in the amount of $14,452 was filed against the Company for past due legal services rendered. Management of the Company believes that the claim is without merit and intends to contest the claim vigorously.

8.           SUBSEQUENT EVENTS

The Company has evaluated subsequent events between the balance sheet date of November 30, 2012 and the date the financial statements were issued, and concluded that events or transactions occurring during that period requiring recognition or disclosure have been made.
 
 
12

 
 
Item 2     Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and plan of operations should be read in conjunction with our unaudited interim financial statements and related notes appearing elsewhere in this Quarterly Report.  Various statements have been made in this Quarterly Report on Form 10-Q that may constitute “forward-looking statements”.  Forward-looking statements may also be made in the Company’s other reports filed with or furnished to the United States Securities and Exchange Commission (the “SEC”) and in other documents.  In addition, the Company through its management may make oral forward-looking statements.

Forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from such statements.  The words “believe,” “expect,” “anticipate,” “optimistic,” “intend,” “plan,” “aim,” “will,” “may,” “should,” “could,” “would,” “likely” and similar expressions are intended to identify forward-looking statements.  These statements are not guarantees of future performance, and therefore, you should not put undue reliance upon them.  Some of the statements that are forward-looking include: our ability to successfully implement our business plan; our estimates of revenues and of other expenses associated with our operations; our ability to identify, explore and extract mineralized material; and our ability to generate sufficient cash flows and maintain adequate sources of liquidity to finance our ongoing operations and capital expenditures.  The Company undertakes no obligation to update or revise any forward-looking statements.

History and Overview

Sara Creek Gold Corp. was incorporated under the laws of the State of Nevada on June 12, 2006, under the name of Uventus Technologies Corp.  On September 23, 2009, we merged with our wholly owned subsidiary and changed our name to Sara Creek Gold Corp. to better reflect our business plan which is the acquisition, exploration, and development of gold and other mineral resource properties.

Plan of Operations

Our overall strategy is to target the exploration and acquisition of mining concessions that allow for economically viable development and production with minimal net environmental impact.  Our exploration target is mineral bodies containing gold.

Results of Operations
 
The following discussion of the financial condition and results of operations should be read in conjunction with the unaudited financial statements included herewith. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of actual operating results in the future.
 
Three months ended November 30, 2012 and 2011

During the three months ended November 30, 2012 we had a net loss of $12,219 consisting of general and administrative expenses.  Similarly, during the three months ended November 30, 2011, we incurred net loss of $9,669 consisting of general and administrative expense in the amounts of $7,898 and interest expense of $1,771.

For the period from June 12, 2006 (inception) to November 30, 2012

We did not earn any revenues from June 12, 2006 (inception) through November 30, 2012 but incurred a net loss in the amount of $759,552. This loss consisted of general and administrative expense in the amount of $750,493 and interest expense of $9,059.  General and administrative expense during this period included notes receivable of $432,894 which was written off as bad debt expense.  
 
Operating Activities

During the three months ended November 30, 2012 we used cash in the amount of $15,823 for operating activities which included a net loss of $12,219 and a decrease in accounts payable in the amount of $3,604.

During the three months ended November 30, 2011 we used cash in the amount of $8,040 for operating activities. Cash used in operating activities included a net loss of $9,669, accrued interest on notes payable of $1,771 and a decrease in accounts payable of $142.

During the period from June 12, 2006 (inception) to November 30, 2012, we used $238,046 of cash for operating activities.  This includes an accumulative net loss of $759,552, a net loss on settlement of debt of $432,894, accrued interest on notes payable of $9,059, issuance of common stock of $25,750, and an increase in accounts payable of $53,803.
 
 
13

 
 
Investing Activities

There were no investing activities for the three months ended November 30, 2012 and 2011.  For the period from June 12, 2006 (inception) to November 30, 2012, cash used in investing activities totaled $432,894 and included cash advances to third parties in the form of notes receivable which were written off as bad debt expense during the years ended August 31, 2010 and 2011.

Financing Activities

During the three months ended November 30, 2012, we received proceeds from notes the issuance of common stock in the amount of $35,000 for total cash provided by financing activities of $35,000.

During the three months ended November 30, 2011, we received proceeds from notes payable in the amount of $25,000 for total cash provided by financing activities of $25,000.

From June 12, 2006 (inception) to November 30, 2012, the Company received proceeds from notes payable in the amount of $618,414, repaid $21,355 to the note holders, and received proceeds from issuance of common stock of $109,000 for total cash provided by financing activities of $706,059.  $583,093 of the proceeds from notes payable was converted to common stock and stockholders waived $9,059 in accrued interest as of November 30, 2012.

Liquidity and Financial Condition

As of November 30, 2012 we had cash of $35,119, current liabilities of $67,769 and a working capital deficit of $32,650.  During the three months ended November 30, 2012, the Company had a loss of $12,219 and used net cash of $15,823 for operating activities.

To date, we have relied on investor capital to fund our operations having raised $109,000 from the issuance of common stock since inception and $618,414 from investors through debt, $21,355 of which was repaid and $583,093 of which was converted to common stock leaving a balance due of $13,966 as of November 30, 2012.

We are in the exploration stage of our business and have not generated any revenues from operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in the implementation of our plan of operations, and possible cost overruns due to price and cost increases.

We presently do not have any available credit, financing or other external sources of liquidity.  In order to obtain future capital, we may need to sell additional shares of common stock or borrow funds from private lenders.  We have no assurance that future financings 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 and any downturn in the U.S. stock and debt markets is likely to make it more difficult to obtain financing through the issuance of equity or debt securities.  As a result, there can be no assurance that we will be successful in obtaining additional funding.

Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses, fail to collect significant amounts owed to us, or experience unexpected cash requirements that would force us to seek alternative financing.  For these reasons, our auditors stated in their report that they have substantial doubt we will be able to continue as a going concern.

Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As of November 30, 2012, we had total current assets of $35,119 and a working capital deficit in the amount of $32,650. We incurred a net loss of $12,219 during the three months ended November 30, 2012 and an accumulated net loss of $759,552 since inception.  We have not earned any revenues since inception and its cash resources are insufficient to meet its planned business objectives.

These conditions raise substantial doubt about our ability to continue as a going concern. These financial statements do not include adjustments relating to the recoverability and classification of reported asset amounts or the amount and classification of liabilities that might be necessary should we be unable to continue as a going concern. Our continuation as a going concern is dependent upon our ability to obtain additional financing or sale our common stock as may be required and ultimately to attain profitability.

Management’s plan in this regard, is to raise capital through a combination of equity and debt financing sufficient to finance the continuing operations for the next twelve months.  However, there can be no assurance that we will be successful in raising such financing.  As an alternative, we may be amenable to a sale, merger, or other acquisition in the event such transaction is deemed by management to be in the best interests of the shareholders.
 
 
14

 

Summary of Significant Accounting Policies
 
Our financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (“GAAP”). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenues and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.  
 
Our significant accounting policies are summarized in Note 2 of our unaudited interim financial statements. While all these significant accounting policies impact our financial condition and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates. Actual results may differ from those estimates. Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause effect on our results of operations, financial position or liquidity for the periods presented in this report.
 
We believe the following critical accounting policies and procedures, among others, affect our more significant judgments and estimates used in the preparation of our unaudited interim financial statements:
 
Exploration Stage Company
 
Our financial statements are presented as a company in the exploration stage of business.  Activities during the exploration stage primarily include implementation of the business plan and obtaining debt and/or equity related financing.
 
Use of Estimates
 
The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from those estimates.

Cash

Cash and cash equivalents consist primarily of cash on deposit, certificates of deposit, money market accounts, and investment grade commercial paper that are readily convertible into cash and purchased with original maturities of three months or less.

Net Loss per Common Share

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during each period.  Diluted earnings (loss) per share is computed by dividing net income (loss), adjusted for changes in income or loss that resulted from the assumed conversion of convertible shares, by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.

Recently Issued Accounting Pronouncements
 
There are no recent accounting pronouncements that are expected to have an effect on our financial statements.

Off-Balance Sheet Arrangements
 
We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (SPEs).
 
Item 3     Quantitative and Qualitative Disclosures about Market Risk
 
Not required for a smaller reporting company.
 
 
15

 
 
Item 4     Controls and Procedures

Disclosure Controls and Procedures

Our management has evaluated, under the supervision and with the participation of our President, Chief Executive and Interim Chief Financial Officer, the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15(b) and 15d-15 (b) under the Securities Exchange Act of 1934 (the “Exchange Act”).  Based on that evaluation, our Chief Executive and Interim Chief Financial Officer has concluded that, as of the end of the period covered by this report, our disclosure controls and procedures are effective in ensuring that information required to be disclosed in our Exchange Act reports is (1) recorded, processed, summarized and reported in a timely manner, and (2) accumulated and communicated to our management, including our President, Chief Executive and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
 
 
 
 
 

 
 
16

 

PART II
 
Item 1     Legal Proceedings
 
On November 10, 2011, a claim in the amount of $14,452 was filed against the Company for past due legal services rendered. Management of the Company believes that the claim is without merit and intends to contest the claim vigorously.
 
Item 1A  Risk Factors
 
Not required for a smaller reporting company.

Item 2     Unregistered Sales of Equity Securities and Use of Proceeds

Year Ended August 31, 2006

On June 12, 2006, the Company issued 1,000,000 shares of its $0.001 par value common stock to various directors at $0.001 per share for a subscription receivable of $10,000, which was received in 2007.

Year Ended August 31, 2008

On February 14, 2008, the Company issued 490,000 shares of its $0.001 par value common stock pursuant to a private placement at $0.10 per share for gross proceeds in the amount of $49,000.

Year Ended August 31, 2011

On February 8, 2011, the Company issued 1,676,977 shares of its $0.001 par value common stock in exchange for outstanding debt in the amount of $503,093 at $0.30 per share.

Year Ended August 31, 2012

On April 19, 2012, the Company issued 5,000,000 shares of its par value common stock in exchange for outstanding debt in the amount of $50,000 at $0.01 per share.

On May 22, 2012, the Company issued 600,000 shares of its par value common stock in exchange for outstanding debt in the amount of $30,000 at $0.05 per share.

On August 14, 2012, the Company issued 515,000 shares of its par value common stock in exchange for services rendered in the amount of $25,750 at $0.05 per share.

On August 31, 2012, the Company received gross proceeds in the amount of $15,000 for 300,000 shares of its par value common stock at $0.05 per share.  As of August 31, 2012, the shares had not been issued and are recorded as common stock payable.  The shares were issued on September 4, 2012.

On September 10, 2012 the Company issued 200,000 shares of its par value common stock in exchange for cash at $0.05 per share for gross proceeds in the amount of $10,000.

Three Months Ended November 30, 2012

On September 10, 2012 the Company issued 700,000 shares of its par value common stock in exchange for cash at $0.05 per share for gross proceeds in the amount of $35,000.  In addition, the Company issued 300,000 shares which had been recorded to common stock payable as of August 31, 2012.

All of the above offerings and sales were deemed to be exempt under either Rule 506 of Regulation D or Section 4(2) of the Securities Act of 1933, as amended. No advertising or general solicitation was employed in offering the securities. The offerings and sales were made to a limited number of persons, all of whom were accredited investors, friends or business associates of executive officers of the Company, and transfer was restricted by the Company in accordance with the requirements of the Securities Act of 1933. In addition to representations by the above-referenced persons, we have made independent determinations that all of the above-referenced persons were accredited or sophisticated investors, and that they were capable of analyzing the merits and risks of their investment, and that they understood the speculative nature of their investment. The individuals and entities to whom we issued securities as indicated in this section are unaffiliated with us.
 
 
17

 
 
Item 3     Defaults upon Senior Securities

None. 

Item 4     Mine Safety Disclosures

N/A.
 
Item 5     Other Information
 
None.
 
Item 6     Exhibits
 

Number
Exhibit
   
31.1
Certification of Principal Executive and Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1
Certification of Principal Executive and Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*
XBRL Instance Document
101.SCH*
XBRL Taxonomy Extension Schema Document
101.CAL*
XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB*
XBRL Taxonomy Extension Label Linkbase Document
101.PRE*
XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF*
XBRL Taxonomy Extension Definition Linkbase Document

*  Pursuant to applicable securities laws and regulations, we are deemed to have complied with the reporting obligation relating to the submission of interactive data files in such exhibits and are not subject to liability under any anti-fraud provisions of the federal securities laws as long as we have made a good faith attempt to comply with the submission requirements and promptly amend the interactive data files after becoming aware that the interactive data files fail to comply with the submission requirements. Users of this data are advised that, pursuant to Rule 406T, these interactive data files are deemed not filed and otherwise are not subject to liability.
 
 
18

 
 
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.


   
Sara Creek Gold Corp.
     
Date: January 14, 2013
 
/s/ Kristian Andresen
   
Kristian Andresen
President, Chief Executive Officer (Principal Executive
Officer) and Interim Chief Financial Officer (Interim Principal
Accounting and Financial Officer)
 
 
 
 
 
 19