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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 10-Q

 

[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
   
  For the quarterly period ended April 30, 2014
   
[  ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934
   
  For the transition period                  to __________
   
  Commission File Number:  333-146442

 

Goldspan Resources, Inc.
(Exact name of small business issuer as specified in its charter)

 

Nevada 26-3342907
(State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.)
     

 

836 S Vance St., Unit E, Lakewood, CO  
(Address of principal executive offices)

 

303-875-1044
(Issuer’s telephone number)
_______________________________________________________________

(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 [X] Yes [] No

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). [X ] Yes [] 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.

 

[ ] Large accelerated filer

[ ] Non-accelerated filer

[ ] Accelerated filer

[X] Smaller reporting company

 

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

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 80,449,631 as of June 16, 2014.

 

1

 

 



TABLE OF CONTENTS



Page

PART I – FINANCIAL INFORMATION

Item 1: Financial Statements 5
Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations 6
Item 3: Quantitative and Qualitative Disclosures About Market Risk 9
Item 4T:

Controls and Procedures 

9

 

PART II – OTHER INFORMATION

Item 1: Legal Proceedings  

Item 1A:

Risk Factors

 
Item 2: Unregistered Sales of Equity Securities and Use of Proceeds  
Item 3: Defaults Upon Senior Securities  
Item 4: Mine Safety Disclosures  
Item 5: Other Information  
Item 6: Exhibits  

 

2

 

PART I - FINANCIAL INFORMATION

 

Item 1.      Financial Statements

 

Our financial statements included in this Form 10-Q are as follows:

 

F-1 Balance Sheets as of April 30, 2014 and July 31, 2013 (unaudited);

F-2

Statements of Operations for the three and nine months ended April 30, 2014 and April 30, 2013 and from Inception on March 2, 2007 through April 30, 2014 (unaudited);
F-3 Statements of Cash Flows for the nine months ended April 30, 2014 and April 30, 2013 and from Inception on March 2, 2007 through April 30, 2014 (unaudited);
F-4 Notes to Financial Statements.

 

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the SEC instructions to Form 10-Q. In the opinion of management, all adjustments considered necessary for a fair presentation and for the financial statements to be not misleading have been included. Operating results for the interim period ended April 30, 2014 are not necessarily indicative of the results that can be expected for the full year.

 

3

 

 

 GOLDSPAN RESOURCES, INC.

(A Development Stage Company)

Balance Sheets

(Unaudited)

 

  April 30,  July 31,
  2014  2013
ASSETS          
CURRENT ASSETS          
Cash  $7   $142 
Total Current Assets   7    142 
TOTAL ASSETS  $7   $142 
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)          
CURRENT LIABILITIES          
Accounts payable  $31,490   $26,959 
Accrued expenses   82,471    74,220 
Notes payable   110,000    110,000 
Shareholder loans   39,938    20,013 
Total Current Liabilities   263,899    231,192 
STOCKHOLDERS' EQUITY (DEFICIT)          
Preferred stock - $.001 par value, 10,000,000 shares authorized, -0- shares issued and outstanding   —      —   
Common stock - $0.001 par value; 400,000,000 shares authorized; 80,449,631 shares issued and outstanding   80,450    80,450 
Additional paid-in capital   1,434,332    1,434,332 
Deficit accumulated during the development stage   (1,778,674)   (1,745,832)
Total Stockholders' Equity (Deficit)   (263,892)   (231,050)
   TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)  $7   $142 

 

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

 

F-1

 

GOLDSPAN RESOURCES, INC.

(A Development Stage Company)

Statements of Operations

(unaudited)

 

              From Inception
  For the Three  For the Three  For the Nine  For the Nine  on March 2,
  Months Ended  Months Ended  Months Ended  Months Ended  2007 Through
  April 30,  April 30,  April 30,  April 30,  April 30,
   2014  2013  2014  2013  2014
REVENUES  $—     $—     $—     $—     $—   
OPERATING EXPENSES                         
Management fees   —      15,000    —      96,664    363,043 
Professional fees   3,696    186,140    23,971    227,150    1,065,060 
Option expenses   —      5,000    —      165,000    315,000 
General and administrative   481    3,647    621    5,485    21,600 
Total Operating Expenses   4,177    209,787    24,592    494,299    1,764,703 
LOSS FROM OPERATIONS   (4,177)   (209,787)   (24,592)   (494,299)   (1,764,703)
OTHER INCOME (EXPENSE)                         
Interest expense   (2,750)   (2,632)   (8,250)   (3,975)   (14,971)
Extinguishment of Debt   —      —      —      —      1,000 
Total other income (expense)   (2,750)   (2,632)   (8,250)   (3,975)   (13,971)
LOSS BEFORE INCOME TAXES   (6,927)   (212,419)   (32,842)   (498,274)   (1,778,674)
PROVISION FOR INCOME TAXES   —      —      —      —      —   
NET LOSS  $(6,927)  $(212,419)  $(32,842)  $(498,274)  $(1,778,674)
BASIC LOSS PER SHARE  $—     $—     $—     $(0.01)     
  WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING   80,449,631    79,616,298    80,449,631    72,814,446      

 

The accompanying notes are a integral part of these financials statements.

 

F-2

 

GOLDSPAN RESOURCES, INC.

(A Development Stage Company)

Statements of Cash Flows

(unaudited)

 

        From Inception
  For the Nine  For the Nine  on March 2,
  Months Ended  Months Ended  2007 Through
  April 30,  April 30,  April 30,
   2014  2013  2014
OPERATING ACTIVITIES               
Net loss  $(32,842)  $(498,274)  $(1,778,674)
  Adjustments to reconcile net loss to net cash used by operating activities:               
Common stock issued for services   —      233,750    1,043,000 
Common stock issued for extension fee   —      100,000    250,000 
Changes in operating assets and liabilities:               
Increase (decrease) in accounts payable   4,531    11,523    31,490 
Increase (decrease) in accruals   8,251    10,725    82,471 
Net Cash Used in               
   Operating Activities   (20,060)   (142,276)   (371,713)
INVESTING ACTIVITIES   —      —      —   
FINANCING ACTIVITIES               
Proceeds from loan   —      110,000    110,000 
Shareholder loans, net   19,925    (3,245)   39,938 
Contributed capital   —      —      65,269 
Shares issued for cash   —      35,000    156,513 
Net Cash Provided by               
   Financing Activities   19,925    141,755    371,720 
NET INCREASE (DECREASE) IN CASH   (135)   (521)   7 
CASH AT BEGINNING OF PERIOD   142    727    —   
CASH AT END OF PERIOD  $7   $206   $7 
SUPPLEMENTAL DISCLOSURES OF               
CASH FLOW INFORMATION               
CASH PAID FOR:               
Interest  $—     $—     $—   
Income Taxes  $—     $—     $—   
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES:               
Common stock issued for prepaid consulting  $—          $1,043,000 
Shareholder loan converted to contributed capital  $—     $   $4,000 
Accounts payable converted to contributed capital  $—     $     $61,269 

 

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

 

F-3

 

GOLDSPAN RESOURCES, INC.

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

APRIL 30, 2014

 

 

NOTE 1. CONDENSED FINANCIAL STATEMENTS

 

The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at April 30, 2014 and for all periods presented herein, and for them to be not misleading, have been made.

 

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s July 31, 2013 audited financial statements. The results of operations for the periods ended April 30, 2014 are not necessarily indicative of the operating results for the full year.

 

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES

 

Use of Estimates

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

 

Recent Accounting Pronouncements

No recent accounting standards or interpretations issued or recently adopted are expected to have a material impact on the Company’s financial position, operations or cash flows.

 

NOTE 3. GOING CONCERN

 

The accompanying financial statements are prepared using generally accepted accounting principles applicable to a going concern, which contemplates that the Company will continue in operation for the foreseeable future and will realize its assets and liquidate its liabilities in the normal course of business. However, the Company has no current source of revenue, recurring losses and a deficit accumulated during the exploration stage of $1,778,674 as of April 30, 2014. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. Management plans on raising cash from public or private debt or equity financing, on an as-needed basis and in the longer term, revenues from the acquisition, exploration and development of mineral interests, if found. The Company’s ability to continue as a going concern is dependent on these additional cash financings and, ultimately, upon achieving profitable operations through the development of mineral interests. The successful outcome of future activities cannot be determined at this time. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

NOTE 4. SUBSEQUENT EVENTS

 

In accordance with ASC 855-10, the Company’s management has analyzed its operations through the date on which the financial statements were issued, and has determined it does not have any material subsequent events to disclose other than those discussed above.

 

F-4

 

Item 2.     Management’s Discussion and Analysis or Plan of Operation

 

Forward-Looking Statements

 

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse affect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.

 

Company Overview and Plan of Operations

 

We were incorporated on March 2, 2007, under the laws of the state of Nevada.

 

We have entered into various agreements that would provide for the mining rights for gold prospects. Among those agreements was a project known as the Golden Zone Property. We entered into a non-binding letter of intent with Alix Resources Corp. (“Alix”) for the potential purchase of an option to acquire a 60% ownership interest in certain mineral properties located in the State of Alaska (the “Property”). There were numerous extensions to the option agreement, including extensions involving the payment of stock and cash, however there was not sufficient funds available to us to comply with the option terms and conditions and the option has been cancelled with no further liability to us.

 

Expected Changes In Number of Employees, Plant, and Equipment

 

We do not have plans to purchase any physical plant or any significant equipment or to change the number of our employees during the next twelve months.

 

Results of Operations for the three and nine months ended April 30, 2014 and 2013

 

We did not earn any revenues from inception on March 2, 2007 through the period ending April 30, 2014. We can provide no assurance that we will produce significant revenues in the future, or, if revenues are earned, that we will be profitable.

 

We incurred operating expenses of $1,764,703 and net losses in the amount of $1,778,674 from our inception on March 2, 2007 through the period ending April 30, 2014.  We had no operating income for the three months ended April 30, 2014. We incurred operating expenses in the amount of $4,177 during the three months ended April 30, 2014. These expenses consisted of accounting fees of $3,000, legal fees of $406, license fees of $475, transfer agent fees of $290 and bank fees of $6.

 

By way of comparison we incurred operating expenses in the amount of $209,787 and a net loss in the amount of $212,419 during the three months ended April 30, 2013. These expenses included accounting fees of $1,750, investor relations services of $167,500, legal fees of $15,700, management fees of $15,000, an option loss for a forfeited land deposit of $5,000, interest expense of $2,632 and other costs in the amount of $4,837.

 

We incurred operating expenses of $24,592 and a net loss of $32,842 for the nine months ended April 30, 2014 which included accounting fees of $12,000, auditing fees of $8,750, legal fees of $2,931, bank fees of $91, transfer agent fees of $290, license fees of $475 and office expenses of $53. By way of comparison we had operating expenses of $494,299 and a net loss of $498,274 for the nine months ended April 30, 2013 which included accounting fees of $8,550, auditing fees of $6,250, investor relations of $182,245, legal fees of $27,561, Management fees of $96,664, an option fee of $160,000, loss for a good faith deposit of $5,000 (classified as an option fee), and other costs in the amount of $8,029.

 

Liquidity and Capital Resources

 

As of April 30, 2014, we had cash of $7 and a working capital deficit of $263,892. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms, or at all.

 

We have not attained profitable operations and may be dependent upon obtaining financing to pursue a long-term business plan.

 

Off Balance Sheet Arrangements

 

As of April 30, 2014, there were no off balance sheet arrangements.

 

4

 

Going Concern

 

Our financial statements have been prepared on a going concern basis. As of April 30, 2014 we had a working capital deficit of $263,892 and an accumulated deficit of $1,778,674 since inception. Our ability to continue as a going concern is dependent upon our ability to generate profitable operations in the future and/or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due. The outcome of these matters cannot be predicted with any certainty at this time. These factors raise substantial doubt that we will be able to continue as a going concern. Management plans to continue to provide for our capital needs by the issuance of common stock and related party advances.

  

Critical Accounting Policies

 

In December 2001, the SEC requested that all registrants list their most “critical accounting polices” in the Management Discussion and Analysis. The SEC indicated that a “critical accounting policy” is one which is both important to the portrayal of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. We do not believe that any accounting policies fit this definition for our company.

 

Recently Issued Accounting Pronouncements

 

No recent accounting standards or interpretations issued or recently adopted are expected to have a material impact on the Company’s financial position, operations or cash flows.

 

Item 3.     Quantitative and Qualitative Disclosures About Market Risk

 

A smaller reporting company is not required to provide the information required by this Item.

 

Item 4T.     Controls and Procedures

 

We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of April 30, 2014. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of April 30, 2014, our disclosure controls and procedures were not effective. There have been no changes in our internal controls over financial reporting during the quarter ended April 30, 2014.

 

Management determined that the material weaknesses that resulted in controls being ineffective are primarily due to lack of resources and number of employees. Material weaknesses exist in the segregation of duties required for effective controls and various reconciliation and control procedures not regularly performed due to the lack of staff and resources.

 

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

 

Limitations on the Effectiveness of Internal Controls

 

Our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will necessarily prevent all fraud and material error.   Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the internal control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.

 

5

 

PART II – OTHER INFORMATION

 

Item 1.     Legal Proceedings

 

We are not a party to any pending legal proceeding. We are not aware of any pending legal proceeding to which any of our officers, directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse to us.

 

Item 1A. Risk Factors

 

A smaller reporting company is not required to provide the information required by this Item.

 

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

 

Exhibit Number

Description of Exhibit 

31.1 Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2 Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1 Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

6

 

SIGNATURES

 

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Goldspan Resources, Inc.

 

By: /s/ Phillip Allen
 

Phillip Allen

President, Chief Executive Officer, and Director

 

  June 16, 2014

 

In accordance with Section 13 or 15(d) of the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:

 

By: /s/ Phillip Allen
 

Phillip Allen

President, Chief Executive Officer, and Director

 

  June 16, 2014

 

By: /s/ Iain Stewart
 

Iain Stewart

Chief Financial Officer, Secretary, Treasurer, and Director

 

 

June 16, 2014

 

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