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| Item 2 | 3 | ||
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| Item 3 | 11 | ||
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| PART II. | OTHER INFORMATION | 12 | |
| Item 1 | 12 | ||
| Item 2 | 12 | ||
| Item 3 | 12 | ||
| Item 4 | 12 | ||
| Item 5 | 12 | ||
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| Item 6 | 13 | ||
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| SIGNATURES | 14 | ||
2
TAO MINERALS
LTD.
(An Exploration Stage Company)
Unaudited Financial Statements
| Index | Page Number |
| Balance Sheet | F-1 |
| Statement of Changes in Stockholders’ Deficit | F-2 |
| Statements of Operations | F-3 |
| Statements of Cash Flows | F-4 |
| Notes to Financial Statements | F-5-6 |
| TAO MINERALS LTD. |
| (An Exploration Stage Company) |
| Balance Sheet |
| October 31, | |||
| 2007 | |||
| ASSETS | |||
| Current | |||
| Cash | $ | 1,614 | |
| Prepaid Expenses | 29,500 | ||
| Total current assets | 31,114 | ||
| Mineral Properties | |||
| Mineral Rights, net | 353,000 | ||
| Total Mineral Properties | 353,000 | ||
| Total assets | $ | 384,114 | |
| LIABILITIES | |||
| Current | |||
| Accounts payable and accrued expenses | $ | 114,531 | |
| Due to a related party | 3,000 | ||
| Stock issuance liability | 620,000 | ||
| Other accrued liabilities | 183,000 | ||
| Total current liabilities | 920,531 | ||
| Total Liabilities | 920,531 | ||
| STOCKHOLDERS’ EQUITY | |||
| Share capital | |||
| Authorized: | |||
| Preferred stock$0.001 par value1,000, 000 shares authorized | |||
| None issued, allotted and outstanding: | - | ||
| Common stock $0.001 par value, 552,000,000 shares authorized | |||
| Issued, allotted and outstanding: 55,816,000 shares of common stock | 55,816 | ||
| Additional paid-in capital | 534,095 | ||
| Deficit accumulated during exploration stage | (1,126,328 | ) | |
| Total stockholders’ deficit | (536,417 | ) | |
| Total liabilities and stockholders’ deficit | $ | 384,114 |
The accompanying notes are an integral part of these financial statements.
F-1
| TAO MINERALS LTD. | |
| (An Exploration Stage Company) | Page 1 of 2 |
| Statement of Changes in Stockholders' Deficit | |
| For the period September 23, 2004 (Inception) to October 31, 2007 | |
| Deficit | Total | |||||||||||||||||
| Accumulated | ||||||||||||||||||
| Additional | During | Stock- | ||||||||||||||||
| Common stock | paid-in | Subscription | Exploration | holders' | ||||||||||||||
| Shares | Amount | capital | Receivable | Stage | (deficiency) | |||||||||||||
| Common stock issued to founders for cash | ||||||||||||||||||
| ($0.001 per share) | 54,080,000 | $ | 54,080 | $ | $ | $ | (47,320 | ) | $ | 6,760 | ||||||||
| Common stock issued for cash ($0.05 per share) | 7,836,000 | 7,836 | 47,995 | (425 | ) | (6,856 | ) | 48,550 | ||||||||||
| - | ||||||||||||||||||
| - net loss for the year | (5,577 | ) | (5,577 | ) | ||||||||||||||
| Balance, January 31, 2005 | 61,916,000 | $ | 61,916 | $ | 47,995 $ | (425 | ) | $ | (59,753 | ) | $ | 49,733 | ||||||
The accompanying notes are an integral part of these financial statements.
F-2
| TAO MINERALS LTD. | |
| (An Exploration Stage Company) | |
| Statement of Changes in Stockholders' Deficit | |
| For the period September 23, 2004 (Inception) to October 31, 2007 | Page 2 of 2 |
| Accumulated | Total | |||||||||||||||||
| Additional | Deficit During | Stock- | ||||||||||||||||
| Common stock | paid-in | Subscription | Exploration | holders' | ||||||||||||||
| Shares | Amount | capital | Receivable | Stage | (deficiency) | |||||||||||||
| Balance, January 31, 2005 | 61,916,000 | $ | 61,916 | $ | 47,995 | $ | (425 | ) | $ | (59,753 | ) | $ | 49,733 | |||||
| Subscription receivable cancelled | 425 | 425 | ||||||||||||||||
| - net loss for the year | (48,916 | ) | (48,916 | ) | ||||||||||||||
| Balance, January 31, 2006 | 61,916,000 | $ | 61,916 | $ | 47,995 | $ | - | $ | (108,669 | ) | $ | 1,242 | ||||||
| Common stock issued for mineral rights on April 20, | 2,500,000 | 2,500 | (2,500 | ) | - | - | - | |||||||||||
| 2006 at $.01 | ||||||||||||||||||
| Common stock cancelled April 24, 2006 | (12,600,000 | ) | (12,600 | ) | 12,600 | - | - | - | ||||||||||
| Net loss for the period | (399,636 | ) | (399,636 | ) | ||||||||||||||
| Balance, January 31, 2007 | 51,816,000 | 51,816 | 58,095 | - | (508,305 | ) | (398,394 | ) | ||||||||||
| Common stock issued for legal fees and services | 4,000,000 | 4,000 | 476,000 | - | - | 480,000 | ||||||||||||
| Net loss for the period | (618,023 | ) | (618,023 | ) | ||||||||||||||
| Balance, October 31, 2007 | 55,816,000 | $ | 55,816 | $ | 534,095 | $ | - | $ | (1,126,328 | ) | $ | (536,417 | ) | |||||
The accompanying notes are an integral part of these financial statements.
F-2
| TAO MINERALS LTD. |
| (An Exploration Stage Company) |
| Statements of Operations |
| From Date of | |||||||||||||||
| Inception | |||||||||||||||
| September 23, 2004 | For the three | For the three | For the nine | For the nine | |||||||||||
| to Period Ended | Months ended | Months ended | Months ended | Months ended | |||||||||||
| October 31, 2007 | October 31, 2007 | October 31, 2006 | October 31, 2007 | October 31, 2006 | |||||||||||
| OPERATING EXPENSES | |||||||||||||||
| Exploration expenses | $ | 113,550 | $ | - | $ | - | $ | - | $ | - | |||||
| Professional fees | 258,096 | 15,000 | 3,225 | 47,123 | 36,810 | ||||||||||
| Consulting fees | 559,850 | 345,000 | 44,940 | 543,000 | 100,790 | ||||||||||
| General and administrative | 142,187 | 123,646 | 33,408 | 27,900 | 116,053 | ||||||||||
| Total Operating Expenses | 1,073,683 | 483,646 | 81,573 | 618,023 | 253,653 | ||||||||||
| LOSS FROM OPERATIONS | (1,073,683 | ) | (483,646 | ) | (81,573 | ) | (618,023 | ) | (253,653 | ) | |||||
| OTHER EXPENSE | |||||||||||||||
| Foreign currency translation | 1,531 | - | - | - | - | ||||||||||
| gain (loss) | |||||||||||||||
| Net Loss for the Period | $ | (1,072,152 | ) | $ | (483,646 | ) | $ | (81,573 | ) | $ | (618,023 | ) | $ | (253,653 | ) |
| LOSS PER SHARE – BASIC AND FULLY | $ | (.01 | ) | $ | 0.0 | $ | (.01 | ) | $ | 0.0 | |||||
| DILUTED | |||||||||||||||
| WEIGHTED AVERAGE NUMBER OF | 53,381217 | 51,816,000 | 52,343,473 | 54,850,559 | |||||||||||
| ISSUED SHARES BASIC and FULLY | |||||||||||||||
| DILUTED | |||||||||||||||
The accompanying notes are an integral part of these financial statements.
F-3
| TAO MINERALS LTD. |
| (An Exploration Stage Company) |
| Statements of Cash Flows |
| From Inception Date | |||||||||
| of September 23, 2004 | For the Nine Months | For the Nine Months | |||||||
| to October 31, 2007 | ended October 31, 2007 | ended October 31, 2006 | |||||||
| Cash Provided by (Used for) Operating | |||||||||
| Activities | |||||||||
| Net loss for the period | $ | (1,072,152 | ) | $ | (618,023 | ) | $ | (253,653 | ) |
| Stock Issued for Services and Legal Fees | 480,000 | 480,000 | - | ||||||
| Changes in non-cash working capital items | |||||||||
| Accounts payable and accrued expenses | 197,531 | 108,193 | 2,239 | ||||||
| Prepaid expenses | (29,500 | ) | (12,000 | ) | (10,000 | ) | |||
| Increase in due from related party | 3,000 | - | - | ||||||
| Subscription receivable | 425 | - | - | ||||||
| Cash used by operations | (420,696 | ) | (41,830 | ) | (261,414 | ) | |||
| Investing Activities | |||||||||
| Purchase of mineral rights | (253,000 | ) | - | (250,000 | ) | ||||
| Cash used by investing activities | (253,000 | ) | - | (250,000 | ) | ||||
| Financing Activities | |||||||||
| Issuance of debt | 620,000 | - | 620,000 | ||||||
| Issuance of common stock for cash | 55,310 | - | |||||||
| Cash provided by financing activities | 675,310 | - | 620,000 | ||||||
| Cash Increase (Decrease) During the | |||||||||
| Period | 1,614 | (41,830 | ) | 108,586 | |||||
| Cash, Beginning of Period | - | 43,444 | 2,361 | ||||||
| Cash End of Period | $ | 1,614 | $ | 1,614 | $ | 110,947 |
During the nine months ended October 31, 2007 and 2006 the Company did not pay any cash for interest or taxes.
Supplemental Non cash Disclosure:
On January 31, 2007, the Company accrued a $100,000 payment for Mineral Rights related to it’s Colombian property.
The accompanying notes are an integral part of these financial statements.
F-4
| TAO MINERALS LTD |
| (An Exploration Stage Company) |
| Notes to Financial Statements |
| For the period ended October 31, 2007 |
| 1. | Organization and Summary of Significant Accounting Policies |
Nature of Operations and Going Concern
Tao Minerals, Ltd. (an exploration stage company) (the “Company”) was incorporated under the laws of the State of Nevada on September 23, 2004. The Company is natural resource exploration company with an objective of acquiring, exploring and if warranted and feasible, developing natural resource properties.
As reflected in the accompanying financial statements, the Company is in the exploration stage and has cumulative negative cash flows from operations of $420,696 since inception and losses of $618,023 for the nine month period ended October 31, 2007. This raises substantial doubt about its ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital and implement its business plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.
The financial statements for the nine and three months ended October 31, 2007 and 2006, and for the period from September 23, 2004 (inception) to October 31, 2007, together with the balance sheet as of October 31, 2007 included herein have not been audited by the Company’s independent public accountants. In the opinion of management, all adjustments necessary to present fairly the financial position at October 31, 2007 and the results of operations and cash flows for the periods presented herein have been made.
The financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to such regulations. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-KSB for the year ended January 31, 2007.
The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment. Actual results may vary from these estimates. Prior periods have been adjusted to conform with the presentation of the financial statements ended July 31, 2007.
| 2. | Mineral Properties |
Pursuant to the Amending Agreement of June 30, 2006 the Company was obligated to make a payment of $100,000 on July 1, 2007 to Primecap Resources, Inc. (“PR”). The Company did not make such payment but has accrued such obligation as of January 31, 2007. The Company is currently in talks with PR to extend payment to December 30, 2007. Accrued liabilities of $183,000 pertain to the terms of the Amending Agreement.
The Company was obligated to make a $ 40,000 payment and issue 300,000 shares of common stock to PR at August 23, 2007. To date, the Company has not made any payments or issued stock to PR. The Company is currently in negotiations to extend the payment and issuance of stock to December 30, 2007.
F-5
| TAO MINERALS LTD |
| (An Exploration Stage Company) |
| Notes to Financial Statements |
| For the period ended October 31, 2007 |
| 3. | Equity |
On September 21, 2007 The Board of Directors agreed to issue 4,000,000 shares of common stock to consultants, attorneys, and Directors for past services p