U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended November 30, 2006
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission file number 0-32593
GENEVA GOLD CORP.
_________________________________________________________________
(Exact name of small business issuer as specified in its charter)
NEVADA 98-0441019
_______________________________ ___________________
(State or other jurisdiction of (I.R.S. Employer
incorporation of organization) Identification No.)
1005 Terminal Way, Suite 110
Reno, Nevada 89502
________________________________________
(Address of Principal Executive Offices)
(775) 348.9330
___________________________
(Issuer's telephone number)
Revelstoke Industries, Inc.
14977 21st Avenue
Surrey, British Columbia
Canada V4A 8G3
____________________________________________________
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
________ ________
Indicate by checkmark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
Yes No X
________ _________
Applicable only to issuers involved in bankruptcy proceedings during
the preceding five years.
N/A
Check whether the Registrant filed all documents required to be filed
by Section 12, 13 and 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.
Yes No
________ _________
Applicable only to corporate issuers
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
Class Outstanding as of January 12, 2007
Common Stock, $.001 par value 41,200,000
Transitional Small Business Disclosure Format (check one)
Yes No X
________ _________
PART I. FINANCIAL INFORMATION
ITEM 1. INTERIM FINANCIAL STATEMENTS
BALANCE SHEETS
INTERIM STATEMENTS OF OPERATIONS
INTERIM STATEMENT OF STOCKHOLDERS' EQUITY
INTERIM STATEMENTS OF CASH FLOWS
NOTES TO INTERIM FINANCIAL STATEMENTS
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION OR PLAN OF OPERATION
ITEM 3. CONTROLS AND PROCEDURES
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
ITEM 5. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
SIGNATURES
PART 1. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
NOVEMBER 30, 2006
(UNAUDITED)
BALANCE SHEETS
STATEMENTS OF OPERATIONS
STATEMENTS OF CASH FLOWS
NOTES TO FINANCIAL STATEMENTS
1
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
November 30, May 31,
2006 2006
--------------------------------------------------------------------------------------------- ----------------- ------------------
(unaudited)
ASSETS
CURRENT ASSETS
Cash $ 18,975 $ 73,383
--------------------------------------------------------------------------------------------- ----------------- ------------------
$ 18,975 $ 73,383
============================================================================================= ================= ==================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 92,426 $ 19,171
Due to related parties (Note 5) - 16,799
Agreement Payable (Note 3(b)) 7,400,000 -
Shareholders' loan (Note 6) 100,438 100,000
--------------------------------------------------------------------------------------------- ----------------- ------------------
7,592,864 35,970
--------------------------------------------------------------------------------------------- ----------------- ------------------
CONTINGENCY AND COMMITMENTS (Notes 1, 3 and 7)
STOCKHOLDERS' EQUITY (DEFICIT)
Capital stock (Note 4)
Authorized
50,000,000 shares of common stock, $0.001 par value,
Issued and outstanding
37,200,000 shares of common stock (May 31, 2006 - 37,200,000) 37,200 16,800
Additional paid-in capital 136,967 157,367
Deficit accumulated during the development stage (7,748,056) (136,754)
--------------------------------------------------------------------------------------------- ----------------- ------------------
(7,573,889) 37,413
--------------------------------------------------------------------------------------------- ----------------- ------------------
$ 18,975 $ 73,383
============================================================================================= ================= ==================
The accompanying notes are an integral part of these financial statements
F-1
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(unaudited)
Cumulative
Three months Three months results from
ended ended Six months Six months April 5, 2004
November 30, November 30, ended ended (inception) to
2006 2005 November November November 30,
30, 2006 30, 2005 2006
------------------------------------------------------- --------------- -------------- ------------- ------------- ----------------
REVENUE $ - $ - $ - $ - $ 46,974
------------------------------------------------------- --------------- -------------- ------------- ------------- ----------------
DIRECT COSTS - - - - 56,481
------------------------------------------------------- --------------- -------------- ------------- ------------- ----------------
GROSS MARGIN (LOSS) - - - - (9,507)
------------------------------------------------------- --------------- -------------- ------------- ------------- ----------------
GENERAL AND ADMINISTRATIVE EXPENSES
Office and general 15,031 2,846 15,366 3,699 48,270
Consulting fees 25,701 2,285 25,701 5,337 54,794
Mineral Property Expenditures (Note 3) 7,500,000 - 7,500,000 - 7,500,000
Professional fees 52,704 6,018 70,235 18,557 135,485
------------------------------------------------------- --------------- -------------- ------------- ------------- ----------------
(7,593,436) (11,149) (7,611,302) (27,593) (7,738,549)
------------------------------------------------------- --------------- -------------- ------------- ------------- ----------------
NET LOSS $ (7,593,436) $ (11,149) $ (7,611,302) $ (27,593) $ (7,748,056)
======================================================= =============== ============== ============= ============= ================
BASIC AND DILUTED LOSS PER COMMON SHARE $ (0.20) $ (0.00) $ (0.20) $ (0.00)
======================================================= =============== ============== ============= =============
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
-BASIC AND DILUTED 37,200,000 20,400,000 37,200,000 20,400,000
======================================================= =============== ============== ============= =============
The accompanying notes are an integral part of these financial statements
F-2
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(unaudited)
Cumulative
results from
Six months Six months April 5, 2004
ended ended (inception) to
November 30, November 30, November 30,
2006 2005 2006
------------------------------------------------------------------------------ ---------------- ---------------- ------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (7,611,302) $ (27,593) $ (7,748,056)
Adjustments to reconcile net loss to net cash used in operating activities:
Non-cash property costs 7,400,000 - 7,400,000
Accounts receivable - (309) -
Due from related party (16,799) - -
Prepaid expenses - 8,375 -
Accounts payable and accrued liabilities 73,693 (40,249) 92,864
------------------------------------------------------------------------------ ---------------- ---------------- ------------------
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES (154,408) (59,776) (255,192)
------------------------------------------------------------------------------ ---------------- ---------------- ------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds on sale of common stock - - 174,167
Proceeds from shareholder advances 100,000 - 100,000
------------------------------------------------------------------------------ ---------------- ---------------- ------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 100,000 - 274,167
------------------------------------------------------------------------------ ---------------- ---------------- ------------------
NET INCREASE (DECREASE) IN CASH (54,408) (59,776) 18,975
CASH, BEGINNING OF PERIOD 73,383 63,704 -
------------------------------------------------------------------------------ ---------------- ---------------- ------------------
CASH, ENDING OF PERIOD $ 18,975 $ 3,928 $ 18,975
============================================================================== ================ ================ ==================
Supplemental disclosures with respect to cash flows:
Interest paid $- $- $-
============================================================================== ================= ================ =================
Income taxes paid $- $- $-
============================================================================== ================= ================ =================
The accompanying notes are an integral part of these financial statements
F-3
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2006 (UNAUDITED)
________________________________________________________________________________
NOTE 1 - NATURE OF OPERATIONS AND BASIS OF PRESENTATION
________________________________________________________________________________
The Company was incorporated in the State of Nevada on April 5, 2004. The
Company was initially formed to engage in the business of reclaiming and
stabilizing land in preparation for construction in the United States of
America. On November 27, 2006 the Company filed Articles of Merger with the
Secretary of State of Nevada in order to effectuate a merger whereby the Company
(as Revelstoke Industries, Inc.) would merge with its wholly-owned subsidiary,
Geneva Gold Corp. and the Company was the surviving corporation. This merger
became effective as of December 1, 2006 and the Company changed its name to
Geneva Gold Corp.
During the quarter ended November 30, 2006 the Company entered the business of
exploration of precious metals with a focus on the exploration and development
of gold deposits in North America and Internationally. During the period the
Company entered into Option Agreements to obtain mineral leases in Canada and in
Panama.
The Company has elected a fiscal year of May 31. On May 5, 2006; the Company
completed a forward stock split by the issuance of 42 new shares for each 1
outstanding share of the Company's common stock. On October 13, 2006; the
Company completed a forward stock split by the issuance of 4 new shares for each
1 outstanding share of the Company's stock.
GOING CONCERN
To date the Company has generated minimal revenues from its business operations
and has incurred operating losses since inception of $7,748,056. The Company
requires additional funding to meet its ongoing obligations and operating
losses. The ability of the Company to continue as a going concern is dependant
on raising capital to fund its initial business plan and ultimately to attain
profitable operations. Accordingly, these factors raise substantial doubt as to
the Company's ability to continue as a going concern. The Company intends to
continue to fund its mineral exploration business by way of private placements
and advances from related parties as may be required.
UNAUDITED INTERIM FINANCIAL STATEMENTS
The accompanying unaudited interim consolidated financial statements have been
prepared in accordance with generally accepted accounting principals for interim
financial information and with the instructions to Form 10-QSB of Regulation
S-B. They do not include all information and footnotes required by United States
generally accepted accounting principles for complete financial statements.
However, except as disclosed herein, there has been no material changes in the
information disclosed in the notes to the financial statements for the year
ended May 31, 2006 included in the Company's Annual Report on Form 10-KSB filed
with the Securities and Exchange Commission. The interim unaudited financial
statements should be read in conjunction with those financial statements
included in the Form 10-KSB. In the opinion of Management, all adjustments
considered necessary for a fair presentation, consisting solely of normal
recurring adjustments, have been made. Operating results for the six months
ended November 30, 2006 are not necessarily indicative of the results that may
be expected for the year ending May 31, 2007.
COMPARATIVE FIGURES
Certain comparative figures have been reclassified in order to conform to the
current year's financial statement presentation.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
________________________________________________________________________________
BASIS OF PRESENTATION
These financial statements are presented in United States dollars and have been
prepared in accordance with generally accepted accounting principles in the
United States of America.
USE OF ESTIMATES AND ASSUMPTIONS
Preparation of the financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of expenses during the period. Accordingly, actual results
could differ from those estimates.
MINERAL PROPERTY EXPENDITURES
Mineral property exploration and development costs are expensed as incurred
until such time as economic reserves are quantified. The Company has considered
the guidance under EITF 04-2 and has determined that capitalization of mineral
property acquisition costs is inappropriate at the current stage of the
Company's mineral property exploration activities. To
F-4
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2006 (UNAUDITED)
________________________________________________________________________________
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________
MINERAL PROPERTY EXPENDITURES (CONTINUED)
date, the Company's mineral interests consist mainly of option agreements on
exploration stage properties. Furthermore, there is uncertainty as to the
Company's ability to fund the exploration work necessary to determine if the
properties have recoverable reserves or any future economic benefits. As a
result, acquisition costs to date are considered to be impaired and accordingly,
have been written off as mineral property expenditures.
To date, the Company has not established any proven or probable reserves on its
mineral property interests. Estimated future removal and site restoration costs
are provided over the life of proven reserves on a units-of-production basis.
Costs, which include production equipment removal and environmental remediation,
are estimated each period by management based on current regulations, actual
expenses incurred, and technology and industry standards. Any charge is included
in exploration expense or the provision for depletion and depreciation during
the period and the actual restoration expenditures are charged to the
accumulated provision amounts as incurred.
ASSET RETIREMENT OBLIGATIONS
The Company has adopted the provisions of SFAS No. 143 "Accounting for Asset
Retirement Obligations," which establishes standards for the initial measurement
and subsequent accounting for obligations associated with the sale, abandonment
or other disposal of long-lived tangible assets arising from the acquisition,
construction or development and for normal operations of such assets. The
adoption of this standard has had no effect on the Company's financial position
or results of operations. To November 30, 2006 any potential costs relating to
the ultimate disposition of the Company's mineral property interests have not
yet been determinable.
INCOME TAXES
The Company follows the liability method of accounting for income taxes. Under
this method, deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
balances. Deferred tax assets and liabilities are measured using enacted or
substantially enacted tax rates expected to apply to the taxable income in the
years in which those differences are expected to be recovered or settled. The
effect on deferred tax assets and liabilities of a change in tax rates is
recognized in income in the period that includes the date of enactment or
substantive enactment. As at November 30, 2006 the Company had net operating
loss carry forwards. However, due to the uncertainty of realization the Company
has provided a full valuation allowance for the deferred tax assets resulting
from these loss carryforwards.
NET LOSS PER SHARE
The Company computes loss per share in accordance with SFAS No. 128, "Earnings
per Share" which requires presentation of both basic and diluted earnings per
share on the face of the statement of operations. Basic loss per share is
computed by dividing net loss available to common shareholders by the weighted
average number of outstanding common shares during the period. Diluted loss per
share gives effect to all dilutive potential common shares outstanding during
the period. Dilutive loss per share excludes all potential common shares if
their effect is anti-dilutive.
FOREIGN CURRENCY TRANSLATION
The financial statements are presented in United States dollars. In accordance
with SFAS No. 52, "Foreign Currency Translation", foreign denominated monetary
assets and liabilities are translated to their United States dollar equivalents
using foreign exchange rates which prevailed at the balance sheet date. Revenue
and expenses are translated at average rates of exchange during the period.
Related translation adjustments are reported as a separate component of
stockholders' equity, whereas gains or losses resulting from foreign currency
transactions are included in results of operations.
STOCK-BASED COMPENSATION
On March 1, 2006, the Company adopted SFAS No. 123 (revised 2004) (SFAS No.
123R), 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. In January 2005, the
Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB)
No. 107, which provides supplemental implementation guidance for SFAS No. 123R.
SFAS No. 123R eliminates the ability to account for stock-based compensation
transactions using the intrinsic value method under Accounting Principles Board
(APB) Opinion No. 25, ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES, and instead
F-5
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2006 (UNAUDITED)
________________________________________________________________________________
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________
STOCK-BASED COMPENSATION (CONTINUED)
generally requires that such transactions be accounted for using a
fair-value-based method. The Company uses the Black-Scholes-Merton ("BSM")
option-pricing model to determine the fair-value of stock-based awards under
SFAS No. 123R, consistent with that used for pro forma disclosures under SFAS
No. 123, ACCOUNTING FOR STOCK-BASED COMPENSATION. The Company has elected the
modified prospective transition method as permitted by SFAS No. 123R and
accordingly prior periods have not been restated to reflect the impact of SFAS
No. 123R. The modified prospective transition method requires that stock-based
compensation expense be recorded for all new and unvested stock options,
restricted stock, restricted stock units, and employee stock purchase plan
shares that are ultimately expected to vest as the requisite service is rendered
beginning on March 1, 2006, the first day of the Company's second quarter in
fiscal 2007 . Stock-based compensation expense for awards granted prior to March
1, 2006 is based on the grant date fair-value as determined under the pro forma
provisions of SFAS No. 123.
Prior to the adoption of SFAS No. 123R, the Company measured compensation
expense for its employee stock-based compensation plans using the intrinsic
value method prescribed by APB Opinion No. 25. The Company applied the
disclosure provisions of SFAS No. 123 as amended by SFAS No. 148, ACCOUNTING FOR
STOCK-BASED COMPENSATION - TRANSITION AND DISCLOSURE, as if the fair-value-based
method had been applied in measuring compensation expense. Under APB Opinion No.
25, when the exercise price of the Company's employee stock options was equal to
the market price of the underlying stock on the date of the grant, no
compensation expense was recognized.
The Company has not adopted a stock option plan and has not granted any stock
options. Accordingly, no stock-based compensation has been recorded to date.
FAIR VALUE OF FINANCIAL INSTRUMENTS
In accordance with the requirements of SFAS No. 107, the Company has determined
the estimated fair value of financial instruments using available market
information and appropriate valuation methodologies. The fair value of financial
instruments classified as current assets or liabilities approximate their
carrying value due to the short-term maturity of the instruments.
RECENT ACCOUNTING PRONOUNCEMENTS
In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid
Financial Instruments-an amendment of FASB Statements No. 133 and 140", to
simplify and make more consistent the accounting for certain financial
instruments. SFAS No. 155 amends SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities", to permit fair value re- measurement for
any hybrid financial instrument with an embedded derivative that otherwise would
require bifurcation, provided that the whole instrument is accounted for on a
fair value basis. SFAS No. 155 amends SFAS No. 140, "Accounting for the
Impairment or Disposal of Long-Lived Assets", to allow a qualifying
special-purpose entity to hold a derivative financial instrument that pertains
to a beneficial interest other than another derivative financial instrument.
SFAS No. 155 applies to all financial instruments acquired or issued after the
beginning of an entity's first fiscal year that begins after September 15, 2006,
with earlier application allowed. This standard is not expected to have a
significant effect on the Company's future reported financial position or
results of operations.
In March 2006, the FASB issued SFAS No. 156, "Accounting for Servicing of
Financial Assets, an amendment of FASB Statement No. 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities".
This statement requires all separately recognized servicing assets and servicing
liabilities be initially measured at fair value, if practicable, and permits for
subsequent measurement using either fair value measurement with changes in fair
value reflected in earnings or the amortization and impairment requirements of
Statement No. 140. The subsequent measurement of separately recognized servicing
assets and servicing liabilities at fair value eliminates the necessity for
entities that manage the risks inherent in servicing assets and servicing
liabilities with derivatives to qualify for hedge accounting treatment and
eliminates the
F-6
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2006 (UNAUDITED)
________________________________________________________________________________
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
________________________________________________________________________________
RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)
characterization of declines in fair value as impairments or direct write-downs.
SFAS No. 156 is effective for an entity's first fiscal year beginning after
September 15, 2006. This adoption of this statement is not expected to have a
significant effect on the Company's future reported financial position or
results of operations.
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements". The
objective of SFAS 157 is to increase consistency and comparability in fair value
measurements and to expand disclosures about fair value measurements. SFAS 157
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles, and expands disclosures about fair
value measurements. SFAS 157 applies under other accounting pronouncements that
require or permit fair value measurements and does not require any new fair
value measurements. The provisions of SFAS No. 157 are effective for fair value
measurements made in fiscal years beginning after November 15, 2007. The
adoption of this statement is not expected to have a material effect on the
Company's future reported financial position or results of operations.
In September 2006, the FASB issued SFAS No. 158, "Employers' Accounting for
Defined Benefit Pension and Other Postretirement Plans." This Statement requires
an employer to recognize the over funded or under funded status of a defined
benefit post retirement plan (other than a multiemployer plan) as an asset or
liability in its statement of financial position, and to recognize changes in
that funded status in the year in which the changes occur through comprehensive
income. SFAS No. 158 is effective for fiscal years ending after December 15,
2006. The Company does not expect that the implementation of SFAS No. 158 will
have any material impact on its financial position and results of operations.
In September 2006, the SEC issued Staff Accounting Bulletin ("SAB") No. 108,
"Considering the Effects of Prior Year Misstatements when Quantifying
Misstatements in Current Year Financial Statements." SAB No. 108 addresses how
the effects of prior year uncorrected misstatements should be considered when
quantifying misstatements in current year financial statements. SAB No. 108
requires companies to quantify misstatements using a balance sheet and income
statement approach and to evaluate whether either approach results in
quantifying an error that is material in light of relevant quantitative and
qualitative factors. SAB No. 108 is effective for periods ending after November
15, 2006. The Company is currently evaluating the impact of adopting SAB No. 108
but does not expect that it will have a material effect on its financial
position and results of operations.
NOTE 3 -MINERAL EXPLORATION PROPERTIES
________________________________________________________________________________
(A) GEORGES LAKE PROPERTY
On October 20, 2006 the Company entered into a "Mineral Property Option
Agreement", with War Eagle Mining Company, Inc., a TSX Venture Exchange company
("War Eagle"). pursuant to which War Eagle has granted the Company the sole and
exclusive option to acquire a 70% undivided interest in and to seven mineral
claims comprising a total of 979 hectares, which are located in the Province of
Saskatchewan, Canada.
In order to exercise its Option the Company is required to incur, or cause to be
incurred, on or before December 31, 2008, expenditures in connection with the
Property of not less than $1,000,000 pursuant to a work program or work programs
commenced and operated by the operator thereon. Upon exercise of the Option, if
any, the parties further interests in and to the property will be determined
through an industry standard joint venture agreement which will be deemed to be
effective upon the exercise of the Option.
Effective October 20, 2006 a board member of War Eagle has been appointed to the
Board of the Company.
(B) SAN JUAN PROPERTY - AGREEMENT PAYABLE
On November 16, 2006 the Company entered into a "Property Option Agreement" with
Petaquilla Minerals Ltd ("Petaquilla"). Petaquilla therein has granted the
Company the sole and exclusive option to acquire up to a 70% undivided interest
in and to five exploration concessions situated in the Republic of Panama which
are owned and controlled by Petaquilla's wholly-owned subsidiary.
In order to exercise the initial portion of its Option (the "First Option") to
acquire an initial 60% undivided interest in and to the property the Company is
required: (i) to pay to Petaquilla the aggregate sum of $600,000 in cash, as
noted in 1, 3 and 4 below;
F-7
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2006 (UNAUDITED)
________________________________________________________________________________
NOTE 3 -MINERAL EXPLORATION PROPERTIES (CONTINUED)
________________________________________________________________________________
(B) SAN JUAN PROPERTY (CONTINUED)
(ii) issue Petaquilla 4,000,000 common shares from the treasury of the Company;
and (iii) incur, or cause to be incurred, directly or indirectly, and pay for an
aggregate of $6,000,000 in Exploration Expenditures as follows:
1. The sum of $100,000 in cash (paid).
2. 4,000,000 common shares of the Company to be issued and delivered
to Petaquilla within five business days from the execution and
delivery of the Option Agreement. On December 1, 2006 the Company
issued to Petaquilla 4,000,000 common shares from the treasury of
the Company, at which time Petaquilla became a significant
shareholder of the Company. The Company has accrued $7,400,000 as
an Agreement Payable at November 30, 2006 being the estimated
fair value of the 4,000,000 shares.
3. An additional $200,000 in cash to be paid by wire transfer, and
Exploration Expenditures of not less than $1,000,000 to be
incurred and paid, both on or before May 31, 2007.
4. An additional $300,000 in cash to be paid by wire transfer, and
Exploration Expenditures of not less than $3,000,000 to be
incurred and paid, both on or before May 31, 2008.
5. Cumulative Exploration Expenditures of not less than $6,000,000
to be incurred and paid on or before May 31, 2009. Subject to the
prior exercise of the First Option, and in accordance with the
terms and conditions of the Option Agreement, Petaquilla has
therein also granted to the Company the exclusive right and
further option (the "Second Option") to increase the Company's
undivided interest in and to the property from 60% to 70% by
incurring and paying for an additional $3,000,000 in Exploration
Expenditures during the period between exercise of the First
Option and May 31, 2010.
6. During the currency of the Option Agreement Petaquilla is
entitled to nominate up to 40% of the total number of directors
of the Company.
7. In addition, and as soon as practicable following the execution
and delivery of the Option Agreement, the Company is to establish
a stock option plan which allocates not less than 15% of the then
issued shares in the capital of the Company for the granting of
options and shall grant to Petaquilla, or its nominees stock
options equal in number to not less than one-third of the number
of options allocated under such plan.
NOTE 4 - STOCKHOLDERS' EQUITY
________________________________________________________________________________
As of the end of the period, the Company's capitalization was 50,000,000 common
shares with a par value of $0.001 per share. Subsequent to the period on
December 4, 2006 the Board of Directors of the Company requested the
shareholders of common stock of the Company as of the end of business on
November 27, 2006 to consent to increase the authorized share capital of the
Company from 50,000,000 shares of common stock to 200,000,000 shares of common
stock with the same par value of $0.001 per share. The Company received the
required consents, and on January 12, 2007 the Company filed a Certificate of
Amendment to its Article of Incorporation, which effectuated the increase in
authorized share capital as of that date.
On May 1, 2006, a majority of shareholders and the directors of the Company
approved a special resolution to undertake a forward stock split of the common
stock of the Company on a 42 new shares for 1 old share basis whereby 16,400,000
common shares were issued pro-rata to shareholders of the Company as of the
record date on May 1, 2006.
On September 27, 2006 four founding shareholders returned 7,500,000 (pre - 4:1
Forward Split) of their restricted founders' shares, previously issued at
$0.0016 - $0.009 (pre - 4:1 Forward Split) per share, to treasury and the shares
were subsequently cancelled by the Company. The shares were returned to treasury
for no consideration to the founding shareholders in order to make the share
capital of the Company more attractive to potential investors.
On October 13, 2006, a majority of the Board of Directors approved by way of a
stock dividend to undertake a forward stock split of the common stock of the
Company on a 4 new shares for 1 old share basis whereby 27,900,000 common shares
were issued pro-rata to shareholders of the Company as of the record date on
October 13, 2006
All references in these financial statements to number of common shares, price
per share and weighted average number of common shares outstanding prior to the
42:1 forward split and the 4:1 forward split have been adjusted to reflect these
stock splits on a retroactive basis, unless otherwise noted.
To November 30, 2006 the Company has not granted any stock options and has not
recorded any stock-based compensation.
F-8
GENEVA GOLD CORP.
(FORMERLY REVELSTOKE INDUSTRIES, INC.)
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
NOVEMBER 30, 2006 (UNAUDITED)
________________________________________________________________________________
NOTE 5 - RELATED PARTY TRANSACTIONS
________________________________________________________________________________
A company which is owned by a significant shareholder of the Company was owed
$16,799 for consulting and sub-contracts on land stabilization programs which
were provided in the year ended May 31, 2005. On November 15, 2006 the amount
was waived by the shareholder. The amounts that were payable were unsecured,
non-interest bearing and had no set terms of repayment. (Also, refer to Note 3.)
NOTE 6 - SHAREHOLDERS LOAN
________________________________________________________________________________
On November 14, 2006 a shareholder of the Company advanced to Petaquilla
Minerals Ltd. $100,000 on behalf of the Company (Refer to Note 3). This amount
is unsecured, accruing interest at 10% per annum, and has no set terms of
repayment. The total amount outstanding as of November 30, 2006 including
accrued interest is $100,438.
NOTE 7 - COMMITMENT
________________________________________________________________________________
On January 27, 2005, the Company entered into an agreement of understanding with
Alantic Contractors Ltd. (the "Alantic Agreement"), pursuant to which Alantic
will provide the Company with guidance in launching its operations within the
United States, advise on operational matters, and assist in promoting the
Company's business through Alantic's existing associates. Alantic is a private
company engaged in the business of site preparation and reclamation by
reloading. An officer and director of Alantic is also a significant shareholder
of the Company.
The Company will compensate Alantic for their goods and services on a cost plus
basis, which entails payment for their costs plus a markup of 5% for overhead
and 10% for profit for a total of a 15% markup. The Company will also pay
Alantic a flat fee in the amount of $2,500 plus travel expenses to appraise the
viability of individual prospective projects.
F-9
Statements made in this Form 10-QSB that are not historical or current
facts are "forward-looking statements" made pursuant to the safe harbor
provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section
21E of the Securities Exchange Act of 1934. These statements often can be
identified by the use of terms such as "may," "will," "expect," "believe,"
"anticipate," "estimate," "approximate" or "continue," or the negative thereof.
We intend that such forward-looking statements be subject to the safe harbors
for such statements. We wish to caution readers not to place undue reliance on
any such forward-looking statements, which speak only as of the date made. Any
forward-looking statements represent management's best judgment as to what may
occur in the future. However, forward-looking statements are subject to risks,
uncertainties and important factors beyond our control that could cause actual
results and events to differ materially from historical results of operations
and events and those presently anticipated or projected. We disclaim any
obligation subsequently to revise any forward-looking statements to reflect
events or circumstances after the date of such statement or to reflect the
occurrence of anticipated or unanticipated events.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF
OPERATION
GENERAL
Geneva Gold Corp. is a corporation organized under the laws of the
State of Nevada on April 5, 2004 originally under the name of Revelstoke
Industries, Inc. (herein known as "we", "our", "us" or the "Company").
AMENDMENT TO ARTICLES OF INCORPORATION TO INCREASE AUTHORIZED CAPITAL STRUCTURE
On January 12, 2007, we filed an Amendment to the Articles of
Incorporation (the "Amendment"). In accordance with the Amendment, we increased
our authorized capital from 50,000,000 shares of common stock to 200,000,000
shares of common stock with the same par value of $0.001 per share. On November
27, 2006, our Board of Directors pursuant to minutes of written consent in lieu
of a special meeting authorized and approved the Amendment to increase our
authorized capital and the dissemination of a notice of consent requested from
shareholders without a special meeting dated December 4, 2006 (the "Notice of
Consent") together with a consent/proxy card (the "Proxy"). The Notice of
Consent was distributed to our shareholders with a record date of November 27,
2006. Our Board of Directors fixed the close of business on January 3, 2007 as
the date by which written consents and approvals were to be received by our
shareholders holding a majority of the total issued and outstanding common stock
to approve the Amendment. See "Part II. Item 4.
Submission of Matters to a Vote of Security Holders."
ARTICLES OF MERGER
On November 27, 2006, we filed Articles of Merger with the Nevada
Secretary of State (the "Articles of Merger"). In accordance with the terms and
provisions of the Articles of Merger: (i) we effectuated a merger with our
wholly-owned subsidiary, Geneva Gold Corp., as a parent/subsidiary merger,
whereby we were the surviving corporation; (ii) the merger became effective as
of December 1, 2006 pursuant to Section 92A.180 of the Nevada Revised Statutes;
and (iii) our Articles of Incorporation were amended to change our name to
"Geneva Gold Corp.". In connection with the change in corporate name, our
trading symbol changed. As of the open of business on December 1, 2006, our
trading symbol is GVGC.
2
We decided to change our name to Geneva Gold Corp. to better reflect
our additional resource acquisition and development business resulting from our
recent acquisition of certain options to interests in certain mineral
properties. See " - Current Business Operations" below.
OCTOBER 16, 2006 FORWARD STOCK SPLIT
On October 13, 2006, our Board of Directors pursuant to minutes of
written consent in lieu of a special meeting authorized and approved a forward
stock split of four for one (4:1) of our total issued and outstanding shares of
common stock (the "October 2006 Forward Stock Split").
The October 2006 Forward Stock Split was effectuated based on market
conditions and upon a determination by our Board of Directors that the October
2006 Forward Stock Split was in our best interests and of the shareholders. In
our judgment the October 2006 Forward Stock Split will result in an increase in
our trading float of shares of common stock available for sale resulting in
facilitation of investor liquidity and trading volume potential. The intent of
the October 2006 Forward Stock Split is to increase the marketability of our
common stock.
The October 2006 Forward Stock Split was effectuated with a record date
of October 13, 2006 upon filing the appropriate documentation with NASDAQ. The
October 2006 Forward Stock Split increased our issued and outstanding shares of
common stock from 9,300,000 to approximately 37,200,000 shares of common stock.
(The total number of shares of common stock issued and outstanding had
previously been 16,800,000 since May 1, 2006 pursuant to the May 2006 Forward
Stock Split. However, on September 27, 2006, four of our shareholders consented
to the cancellation and return to treasury of an aggregate of 7,500,000 shares
thus bringing the total number of issued and outstanding shares of common stock
to 9,3000,000 as of October 13, 2006.) The current authorized share capital
continued to be 50,000,000 shares of common stock with a par value of $0.001 per
share.
MAY 1, 2006 FORWARD STOCK SPLIT
On May 1, 2006, our Board of Directors pursuant to minutes of written
consent in lieu of a special meeting authorized and approved a forward stock
split of forty-two (42) for one of our total issued and outstanding shares of
common stock (the "May 2006 Forward Stock Split").
The May 2006 Forward Stock Split was effectuated based on market
conditions and upon a determination by our Board of Directors that the May 2006
Forward Stock Split was in our best interests and of the shareholders. In our
judgment the May 2006 Forward Stock Split will result in an increase in our
trading float of shares of common stock available for sale resulting in
facilitation of investor liquidity and trading volume potential. The intent of
the May 2006 Forward Stock Split is to increase the marketability of our common
stock.
The May 2006 Forward Stock Split was effectuated with a record date of
May 1, 2006 upon filing the appropriate documentation with NASDAQ. The May 2006
Forward Stock Split increased our issued and outstanding shares of common stock
from 400,000 to approximately 16,800,000 shares of common stock. The current
authorized share capital continued to be 50,000,000 shares of common stock with
a par value of $0.001 per share.
3
CURRENT BUSINESS OPERATIONS
We are currently engaged in the business of exploration of precious
metals with a focus on the exploration and development of gold deposits in North
American and internationally. As of the date of this Quarterly Report, our
mineral interests consist mainly of options agreements on exploration stage
properties as discussed below. We have not established any proven or probable
reserves on our mineral property interests.
GEORGES LAKE PROPERTY
On approximately October 20, 2006, we entered into a mineral property
option agreement (the "Georges Lake Option Agreement") with War Eagle Mining
Company ("War Eagle"). In accordance with the terms and provisions of the
Georges Lake Option Agreement: (i) War Eagle granted to us the sole and
exclusive option (the "Option") to acquire a 70% undivided interest in and to
seven mineral claims comprising a total of 979 hectares located in the Province
of Saskatchewan, Canada; (ii) in order to exercise the Option, we are required
to incur or cause to be incurred on or before December 31, 2008 expenditures in
connection with the Georges Lake Property of not less than $1,000,000 pursuant
to a work program to be commenced and operated by the operator thereon; and
(iii) upon exercise of the Option, the further interests of the parties in and
to the Georges Lake Property will be determined through an industry standard
joint venture agreement, which will be deemed to be effective upon the exercise
of the Option.
SAN JUAN PROPERTY
On approximately November 16, 2006, we entered into a property option
agreement (the "San Juan Option Agreement") with Petaquilla Minerals Ltd.
("Petaquilla"). In accordance with the terms and provisions of the San Juan
Option Agreement, Petaquilla granted to us the sole and exclusive option (the
"Option") to acquire up to a 70% undivided interest in and to five exploration
concessions situated in the Republic of Panama, which are owned and controlled
by Petaquilla's wholly-owned Panamanian subsidiary.
FIRST OPTION
In order to exercise the initial portion of the Option to acquire an
initial 60% undivided interest in and to the property (the "First Option"), we
are required to: (i) pay to Petaquilla the aggregate sum of $600,000 (of which
$100,000 was paid on approximately November 17, 2006); (ii) issue to Petaquilla
4,000,000 shares of our restricted common stock (which 4,000,000 shares were
issued as of December 1, 2006. The Company has accrued $7,400,000 as an
agreement payabale at November 30, 2006, being the estimated fair value of the
4,000,000 shares); and (iii) incur or cause to be incurred directly or
indirectly and pay for an aggregate of $6,000,000 in cumulative exploration
expenditures as follows: (a) the sum of $100,000, which has been paid to
Petaquilla); (b) issue 4,000,000 shares of restricted common stock, which have
been issued to Petaquilla; (c) payment of an additional $200,000 and incurrence
and payment of exploration expenditures of not less than $1,000,000 on or before
May 31, 2007; (d) payment of an additional $300,000 and incurrence and payment
of exploration expenditures of not less than $3,000,000 on or before May 31,
2008; and (e) incurrence and payment of cumulative exploration expenditures of
not less than $6,000,000 on or before May 31, 2009. See " - Results of
Operation" and "Part II. Item 2. Changes in Securities and Use of Proceeds."
4
As of December 1, 2006, we have satisfied our current obligations with
respect to the exercise of the First Option under the Sun Juan Option Agreement
to acquire an initial 60% undivided interest in and to the San Juan Property.
SECOND OPTION
Subject to the prior exercise of the First Option and in accordance
with the terms and conditions of the San Juan Option Agreement, Petaquilla has
granted to us the exclusive right and further portion of the Option (the "Second
Option") to increase our undivided interest in and to the San Juan Property from
60% to 70% by incurring and paying for $3,000,000 in exploration expenditures
during the period between the delivery of the Notice of Election and May 31,
2010. Within sixty (60) days following the exercise of the First Option, we are
required to give Petaquilla notice (the Notice of Election) that either: (i) we
elect to accept the grant of the Second Option; or (ii) we elect not to accept
the Second Option. If we make the election, then all further work on the San
Juan Property and the subsequent relationship between us and Petaquilla shall be
governed by a joint venture agreement between the parties. If we elect to accept
the grant of the Second Option but fail to exercise the Second Option, we and
Petaquilla shall have initial interests of 60% and 40%, respectively. We shall
be deemed to have exercised the Second Option and thus acquired a 70% undivided
interest in the San Juan Property by having incurred and paid for $3,000,000 in
exploration expenditures during the period between the delivery of the Notice of
Election and May 31, 2010. If we fail to incur the $3,000,000 in exploration
expenditures by the end of the last day, we may at any time within fifteen days
of such day make a cash payment to Petaquilla in an amount equal to the
deficiency in the $3,000,000 exploration expenditures to be incurred.
RESULTS OF OPERATION
SIX-MONTH PERIOD ENDED NOVEMBER 30, 2006 COMPARED TO SIX-MONTH PERIOD ENDED
NOVEMBER 30, 2005
Our net loss for the six-month period ended November 30, 2006 was
approximately ($7,611,302) compared to a net loss of ($27,593) during the
six-month period ended November 30, 2005 (an increase of $7,583,709).
During the six-month periods ended November 30, 2006 and 2005, we did
not generate any revenue. During the six-month period ended November 30, 2006,
we incurred general and administrative expenses in the aggregate amount of
$7,611,302 compared to general and administrative expenses incurred during the
six-month period ended November 30, 2005 of $27,593. Administrative expenses
incurred during the six-month period ended November 30, 2006 primarily consisted
of: (i) professional fees of $70,235 (2005: $18,557); (ii) office and general
expenses of $15,366 (2005: $3,699); (iii) mineral property expenditures of
$7,500,000 (2005: $-0-); and (iv) consulting fees of $25,701 (2005: $5,337).
General and administrative expenses increased during the six-month period ended
November 30, 2006 due to the incurrence of mineral property expenditures
relating primarily to the San Juan Option Agreement and the accrual of
$7,400,000 as an agreement payable at November 30, 2006 based upon the estimated
fair market value of the 4,000,000 shares of restricted common stock issued to
Petaquilla and the increase in professional fees resulting from the increase in
overall business operations and activity. General and administrative expenses
generally include corporate overhead, financial and administrative contracted
services, marketing, and consulting costs.
5
As discussed above, the increase in net loss during the six-month
period ended November 30, 2006 compared to the six-month period ended November
30, 2005 is attributable primarily to the increase in overall general and
administrative expenses. Our net loss during the six-month period ended November
30, 2006 was approximately ($7,611,302) or ($0.20) per share compared to a net
loss of ($27,593) or ($0.00) during the six-month period ended November 30,
2005. The weighted average number of shares outstanding was 37,200,000 for the
six-month period ended November 30, 2006 compared to 20,400,000 for the
six-month period ended August 31, 2005.
THREE-MONTH PERIOD ENDED NOVEMBER 30, 2006 COMPARED TO THREE-MONTH PERIOD ENDED
NOVEMBER 30, 2005
Our net loss for the three-month period ended November 30, 2006 was
approximately ($7,593,436) compared to a net loss of ($11,149) during the
three-month period ended November 30, 2005 (an increase of $7,582,287).
During the three-month periods ended November 30, 2006 and 2005, we did
not generate any revenue. During the three-month period ended November 30, 2006,
we incurred general and administrative expenses in the aggregate amount of
$7,593,436 compared to general and administrative expenses incurred during the
three-month period ended November 30, 2005 of $11,149. Administrative expenses
incurred during the three-month period ended November 30, 2006 primarily
consisted of: (i) professional fees of $52,704 (2005: $6,018); (ii) office and
general expenses of $15,031 (2005: $2,846); (iii) mineral property expenditures
of $7,500,000 (2005: $-0-); and (iv) consulting fees of $25,701 (2005: $2,285).
General and administrative expenses increased during the three-month period
ended November 30, 2006 primarily due to the incurrence of mineral property
expenditures relating to the San Juan Option Agreement and the accrual of
$7,400,000 as an agreement payable at November 30, 2006 based upon the estimated
fair market value of the 4,000,000 shares of restricted common stock issued to
Petaquilla and the increase in professional fees resulting from the increase in
overall business operations and activity.
As discussed above, the increase in net loss during the three-month
period ended November 30, 2006 compared to the three-month period ended November
30, 2005 is attributable primarily to the increase in overall general and
administrative expenses. Our net loss during the three-month period ended
November 30, 2006 was approximately ($7,593,436) or ($0.20) per share compared
to a net loss of ($11,149) or ($0.00) during the three-month period ended
November 30, 2005. The weighted average number of shares outstanding was
37,200,000 for the three-month period ended November 30, 2006 compared to
20,400,000 for the three-month period ended August 31, 2005.
LIQUIDITY AND CAPITAL RESOURCES
Our financial statements have been prepared assuming that we will
continue as a going concern and, accordingly, do not include adjustments
relating to the recoverability and realization of assets and classification of
liabilities that might be necessary should we be unable to continue in
operation.
SIX-MONTH PERIOD ENDED NOVEMBER 30, 2006
As of the six-month period ended November 30, 2006, our current assets
were $18,975 and our current liabilities were $7,592,864, which resulted in a
working capital deficit of $7,573,889. As of the six-month period ended November
30, 2006, our total assets consisted of the $18,975 in cash. As of the six-month
period ended November 30, 2006, our total liabilities consisted of: (i) $92,426
in accounts payable and accrued liabilities; (ii) $7,400,000 accrued as
agreement payable at November 30, 2006 based upon the estimated fair market
value of the 4,000,000 shares of restricted common stock issued to Petaquilla;
and (iii) $100,438 in shareholders' loan.
6
Stockholders' equity (deficit) decreased from $37,413 at fiscal year
ended May 31, 2006 to ($7,573,889) as at November 30, 2006.
We have not generated positive cash flows from operating activities.
For the six-month period ended November 30, 2006, net cash flows used in
operating activities was ($154,408) compared to net cash flows used in operating
activities for the six-month period ended November 30, 2005 of ($59,776). Net
cash flows used in operating activities for the six-month period ended November
30, 2006 consisted primarily of a net loss of ($7,611,302). Net cash flows used
in operating activities was adjusted by $7,400,000 to reflect the non-cash
property costs associated with the San Juan Option Agreement and the accrual of
$7,400,000 as an agreement payable at November 30, 2006 based upon the estimated
fair market value of the 4,000,000 shares of restricted common stock issued to
Petaquilla and by $73,693 to reflect the increase in accounts payable and
accrued liabilities.
For the six-month period ended November 30, 2006, net cash flows
provided by financing activities was $100,000 compared to net cash flows
provided by financing activities for the six-month period ended November 30,
2005 of $-0-. Net cash flows provided by financing activities for the six-month
period ended November 30, 2006 consisted of proceeds from shareholder advance.
PLAN OF OPERATION
During fiscal year ended May 31, 2006, we closed a private placement
offering pursuant to which we issued an aggregate of 4,200,000 shares of common
stock (100,000 pre-May 2006 Forward Stock Split shares) at $0.0238 per share for
gross proceeds of $100,000. Existing working capital, further advances and
possible debt instruments, anticipated warrant exercises, further private
placements, and anticipated cash flow are expected to be adequate to fund our
operations over the next six months. We have no lines of credit or other bank
financing arrangements. Generally, we have financed operations to date through
the proceeds of the private placement of equity and debt securities. In
connection with our business plan, management anticipates that administrative
expenses will decrease as a percentage of revenue as our revenue increases over
the next twelve months.
Additional issuances of equity or convertible debt securities will
result in dilution to our current shareholders. Further, such securities might
have rights, preferences or privileges senior to our common stock. Additional
financing may not be available upon acceptable terms, or at all. If adequate
funds are not available or are not available on acceptable terms, we may not be
able to take advantage of prospective new business endeavors or opportunities,
which could significantly and materially restrict our business operations.
The report of the independent registered public accounting firm that
accompanies our fiscal year end May 31, 2006 and May 31, 2005 audited financial
statements contains an explanatory paragraph expressing substantial doubt about
our ability to continue as a going concern. The financial statements have been
prepared "assuming that we will continue as a going concern," which contemplates
that we will realize our assets and satisfy our liabilities and commitments in
the ordinary course of business.
7
MATERIAL COMMITMENTS
As of the date of this Quarterly Report, we do not have any significant
material commitments for fiscal year 2006/2007 other than the contractual
arrangement described below.
SHAREHOLDER LOAN
On November 14, 2006, one of our shareholders advanced to Petaquilla an
aggregate of $100,000 on our behalf. The aggregate amount loaned to us of
$100,000 is unsecured and accrues interest at 10% per annum and has no
established terms of repayment. As of the date of this Quarterly Report, we owe
an aggregate of $100,438 in principal and accrued interest.
ALANTIC CONTRACTORS LTD.
In connection with our prior business operations of identification of
parcels of land for the purpose of reclaiming and stabilizing for construction,
we had entered into an agreement of understanding dated January 27, 2005 (the
"Agreement") with Alantic Contractors Ltd. ("Alantic"). Pursuant to the
Agreement: (i) Alantic was to provide us with guidance in launching our previous
business operations within the United States, advise on operational matters and
assist us in promoting our prior business through their existing associates; and
(ii) we were to compensate Alantic for their goods and services on a cost plus
basis, which entailed payment for their costs plus a markup of 5% for overhead
and 10% for profit for a total of a 15% markup and a flat fee in the amount of
$2,500 plus travel expenses to appraise the viability of individual prospective
projects.
As of the date of this Quarterly Report, we have entered into
negotiations with Alantic to terminate the Agreement.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this Quarterly Report, we do not have any off-balance
sheet arrangements that have or are reasonably likely to have a current or
future effect on our financial condition, changes in financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures or
capital resources that are material to investors. The term "off-balance sheet
arrangement" generally means any transaction, agreement or other contractual
arrangement to which an entity unconsolidated with us is a party, under which we
have: (i) any obligation arising under a guaranteed contract, derivative
instrument or variable interest; or (ii) a retained or contingent interest in
assets transferred to such entity or similar arrangement that serves as credit,
liquidity or market risk support for such assets.
ITEM III. CONTROLS AND PROCEDURES
An evaluation was conducted under the supervision and with the
participation of our management, including our President/Chief Executive Officer
and our Treasurer/Chief Financial Officer, of the effectiveness of the design
and operation of our disclosure controls and procedures as at November 30, 2006.
Based on that evaluation, we have concluded that our disclosure controls and
procedures were effective as of such date to ensure that information required to
8
be disclosed in the reports that we file or submit under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), is recorded, processed, summarized
and reported within the time periods specified in Commission rules and forms.
Such officers also confirm that there was no change in our internal control over
financial reporting during the six-month period ended November 30, 2006 that has
materially affected, or is reasonably likely to materially affect, our internal
control over financial reporting.
AUDIT COMMITTEE REPORT
The Board of Directors has established an audit committee. The members
of the audit committee are Mr. Marcus Johnson, Mr. Steven Jewett and Mr. Alan
Sedgwick. Two of the three members of the audit committee are "independent"
within the meaning of Rule 10A-3 under the Exchange Act. The audit committee was
organized on October 20, 2006 and operates under a written charter adopted by
our Board of Directors.
The audit committee has reviewed and discussed with management our
unaudited financial statements as of and for the six-month period ended November
30, 2006. The audit committee has also discussed with Dale Matheson Carr-Hilton
LaBonte LLP the matters required to be discussed by Statement on Auditing
Standards No. 61, Communication with Audit Committees, as amended, by the
Auditing Standards Board of the American Institute of Certified Public
Accountants. The audit committee has received and reviewed the written
disclosures and the letter from Dale Matheson Carr-Hilton LaBonte LLP required
by Independence Standards Board Standard No. 1, Independence Discussions with
Audit Committees, as amended, and has discussed with Dale Matheson Carr-Hilton
LaBonte LLP their independence.
Based on the reviews and discussions referred to above, the audit
committee has recommended to the Board of Directors that the unaudited financial
statements referred to above be included in our Quarterly Report on Form 10-QSB
for the six-month period ended November 30, 2006 filed with the Securities and
Exchange Commission.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Management is not aware of any legal proceedings contemplated by any
governmental authority or any other party involving us or our properties. As of
the date of this Quarterly Report, no director, officer or affiliate is (i) a
party adverse to us in any legal proceeding, or (ii) has an adverse interest to
us in any legal proceedings. Management is not aware of any other legal
proceedings pending or that have been threatened against us or our properties.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
PETAQUILLA MINERALIS LTD.
On December 1, 2006, we issued an aggregate of 4,000,000 shares of our
restricted common stock in accordance with the terms and provisions of the San
Juan Option Agreement. The shares were issued pursuant to an exemption from
registration under Section 4(2) and Rule 903 of Regulation S of the 1933
Securities Act.
9
CANCELLATION OF SHARE CERTIFICATES
On approximately September 27, 2006, four of our founding shareholders
returned an aggregate of 7,500,000 shares of restricted common stock held of
record to treasury. Pursuant to board of director written consent and approval,
we subsequently cancelled the 7,500,000 shares of restricted common stock. The
7,500,000 shares of common stock were returned to treasury for no consideration
to the four shareholders in order to make our share capital more attractive to
potential investors.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
No report required.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On November 27, 2006, our Board of Directors pursuant to minutes of
written consent in lieu of a special meeting authorized and approved an
amendment to the Articles of Incorporation (the "Amendment") to increase our
authorized capital from 50,000,000 shares of common stock to 200,000,000 shares
of common stock with the same par value of $0.001 per share and the
dissemination of a notice of consent requested from shareholders without a
special meeting dated December 4, 2006 (the "Notice of Consent") together with a
consent/proxy card (the "Proxy"). Our Board of Directors fixed the close of
business on January 3, 2007 as the date by which the Proxy was to be received by
us.
Only shareholders of record at the close of business on November 27,
2006 (the "Record Date") were entitled to receipt of the Notice of Consent and
to vote the shares of common stock held by them on such date in the Proxy. As of
the Record Date, an aggregate 37,200,000 shares of common stock were issued and
outstanding. There was no other class of voting securities outstanding at that
date. Each share of common stock held by a shareholder entitled such shareholder
to one vote pursuant to the Proxy. The receipt of Proxies evidencing an
affirmative vote of the holders of a majority of the outstanding shares of
common stock was required to approve the Amendment.
Approval that the Articles of Incorporation be amended to increase the
authorized capital of the Company from 50,000,000 shares of common stock to
200,000,000 shares of common stock with the same par value of $0.001 per share.
For 21,946,655
Against 0
Abstain 15,253,345
ITEM 5. OTHER INFORMATION
APPOINTMENT OF DIRECTOR
Effective on October 20, 2006, our Board of Directors accepted the
consent to act as a director from Terence F. Schorn. The following is a brief
account of the education and business experience of Mr. Schorn during at least
the past five years, indicating his principal occupation during the period, and
the name and principal business of the organization by which he was employed.
10
BIOGRAPHY
Since January 2001, Mr. Schorn has been the president and a director of
War Eagle Mining Company, Inc., an exploration stage mining company which
conducts exploration activity in Mexico and whose shares are presently listed
for trading on the TSX Venture Exchange in Canada. Since February 2006, Mr.
Schorn has also been a director of Twenty-Seven Capital Corp, another TSX
Venture Exchange listed company. Mr. Schorn is also a director of Snowden
Resources Corp., a reporting company listing for trading on the Over-the-Counter
Bulletin Board.
Mr. Schorn is a graduate of the Haileybury School of Mines, holds a
diploma in Gemology, and has over 45 years experience in the mineral industry.
Mr. Schorn is also a Professional Geoscientists registered with The Association
of Professional Engineers and Geoscientists of British Columbia, as well as an
Accredited Gemologist.
ITEM 5. OTHER INFORMATION
No report required.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
Exhibits:
2.01 Amendment to Articles of Incorporation dated January 12, 2007 as
filed with the Secretary of State of the State of Nevada.
10.01 Property Option Agreement as fully executed on November 16, 2006
between Revelstoke Industries, Inc. and Petaquilla Minerals Ltd.
(1)
31.1 Certification of Chief Executive Officer pursuant to Securities
Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
31.2 Certification of Chief Financial Officer pursuant to Securities
Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
32.1 Certifications pursuant to Securities Exchange Act of 1934 Rule
13a- 14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(1) Incorporated by reference to Exhibit 10.01 of Revelstoke
Industries, Inc. Current Report on Form 8-K filed with the
Securities and Exchange Commission on November 16, 2006 (SEC File
No. 0-32593).
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
GENEVA GOLD CORP.
Dated: January 12, 2007 By: /s/ MARCUS JOHNSON
___________________________________
Marcus Johnson, Chief Executive
Officer/President
Dated: January 12, 2007 By: /s/ D. BRUCE HORTON
___________________________________
D. Bruce Horton, Chief Financial
Officer/Treasurer
11