10QSB 1 mainbody.htm MAINBODY mainbody
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10-QSB

[X]
Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
   
 
For the quarterly period ended August 31, 2007
   
[ ]
Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934
   
 
For the transition period __________  to __________
   
 
Commission File Number: 333-140056

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

Nevada
20-5339393
(State or other jurisdiction of incorporation or organization)
 (IRS Employer Identification No.)
 
2915 W. Charleston Blvd., Ste.7, Las Vegas, NV 89102
(Address of principal executive offices)

(702) 383-5862
(Issuer’s telephone number)
 
_______________________________________________________________
(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 Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the issuer 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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). [X] Yes [ ] No

State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 1,390,000 common shares as of August 31, 2007

Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]
 



PART I - FINANCIAL INFORMATION

Item 1.      Financial Statements


These unaudited 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-QSB. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the interim period ended August 31, 2007 are not necessarily indicative of the results that can be expected for the full year.

CODY RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
Balance Sheets
 
 
August 31
2007
  
November 30
2006
 
(Unaudited)
    
ASSETS          
Current Assets
          
Cash & cash equivalents
$
4,226
  
$
38,188
Total Current Assets
  
4,226
   
38,188
TOTAL ASSETS
$
4,226
  
$
38,188
           
LIABILITIES & STOCKHOLDERS' EQUITY
          
Liabilities
          
Current Liabilities
          
Accounts payable and accrued expenses
$
501
  
$
501
Total Current Liabilities
  
501
   
501
Total Liabilities
  
501
   
501
Stockholders' Equity
      
Common Stock - $0.001 par value; 50,000,000 shares authorized, 1,390,000 issued and outstanding.
  
1,390
   
1,390
Additional paid in capital
  
38,610
   
38,610
Stock subscriptions receivable
  
-
   
(875)
Accumulated deficit
  
(36,275)
 
  
(1,438)
Total Stockholders' Equity
  
3,725
   
37,687
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY
$
4,226
  
$
38,188
 
The accompanying notes are an integral part of these financial statements.
 CODY RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Operations
(Unaudited)

 
For the three
months ended
August 31, 2007
  
For the three
months ended
August 31, 2006
  
For the nine
months ended
August 31, 2007
  
For the nine
months ended
August 31, 2006
  
From inception on
July 20, 2006
through
August 31, 2007
Revenues
$
-
  
$
-
  
$
-
  
$
-
  
$
-
Operating Expenses
                            
Professional Fees
  
4,035
   
-
   
19,202
   
-
   
19,563
General & Administrative
  
267
   
-
   
15,635
   
-
   
16,712
Total Operating Expenses
  
4,302
   
-
   
34,837
   
-
   
36,275
Net Loss
$
(4,302)
 
$
-
  
$
(34,837)
 
$
-
  
$
(36,275)
                             
Net Loss Per Share
$
(0.00)
 
$
-
  
$
(0.03)
 
$
-
      
                             
Weighted Average Shares Outstanding
  
1,390,000
   
1,390,000
   
1,390,000
   
1,390,000
     
 
The accompanying notes are an integral part of these financial statements.
 CODY RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Stockholders' Equity
(Unaudited)
 
CommonStock
  
Additional
Paid in
  
Stock
Subscription
  
 Deficit
Accumulated
During
Development
  
 
Total
Stockholders'
 
Shares
  
Amount
  
Capital
  
Receivable
  
Stage
  
Equity
                       
Issuance of Common Stock in September 2006 in exchange
for reduction of accounts payable at $0.001 per share
  
1,000,000
 
$
1,000
  
$
-
  
$
-
  
$
-
  
$
1,000
                                   
Issuance of Common Stock in October 2006 for cash at $0.10 per share
  
220,000
   
220
   
21,780
   
-
   
-
   
22,000
                                   
Issuance of Common Stock in November 2006 for cash at $0.10 per share
  
170,000
   
170
   
16,830
   
(875)
 
  
-
   
16,125
                                   
Net loss to November 30, 2006
  
-
   
-
   
-
         
(1,438)
 
  
(1,438)
                                   
Balance at November 30, 2006
  
1,390,000
   
1,390
   
38,610
   
(875)
 
  
(1,438)
 
  
37,687
                                   
Receipt of stock subscription
  
-
   
-
   
-
   
875
   
-
   
875
                                   
Net loss to August 31, 2007
  
-
   
-
   
-
   
-
   
(34,837)
 
  
(34,837)
                                   
Balance at August 31, 2007
  
1,390,000
 
$
1,390
  
$
38,610
  
$
-
  
$
(36,275)
 
$
3,725
 
The accompanying notes are an integral part of these financial statements.
 CODY RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Cash Flows
(Unaudited)

 
For the nine
months ended
August 31, 2007
  
For the nine
months ended
August 31, 2006
  
From inception on
July 20, 2006
through
August 31, 2007
OPERATING ACTIVITIES
          
Net loss
$
(34,837)
 
$
-
  
$
(36,275)
Adjustments to reconcile net income to net cash provided by operations:
                
Common stock issued for services
  
-
   
-
   
1,000
Changes in operating assets and liabilities:
                
Accounts Payable
  
-
   
-
   
501
Net cash provided by Operating Activities
  
(34,837)
 
  
-
   
(34,774)
                 
FINANCING ACTIVITIES
                
Proceeds from common stock
  
875
         
39,000
Net cash provided by Financing Activities
  
875
   
-
   
39,000
Net cash increase for period
  
(33,962)
 
  
-
   
4,226
Cash at beginning of period
  
38,188
    
-
   
-
Cash at end of period
$
4,226
  
$
-
  
$
4,226
 
The accompanying notes are an integral part of these financial statements.
CODY RESOURCES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
 
1.  DESCRIPTION OF BUSINESS, HISTORY AND SUMMARY OF SIGNIFICANT POLICIES

Description of business - Cody Resources, Inc. (hereinafter referred to as the “Company”) located in Las Vegas, Nevada was incorporated in Nevada on July 20, 2006. The Company is in the mineral exploration and development business. The Company has not commenced significant operations.

History - The Company was incorporated under the laws of the State of Nevada on July 20, 2006.

Development Stage Company - The accompanying financial statements have been prepared in accordance with the Statement of Financial Accounting Standards No. 7 “Accounting and Reporting by Development-Stage Enterprises”. A development-stage enterprise is one in which planned principal operations have not commenced or if its operations have commenced; there has been no significant revenue there from. The Company has not commenced its planned principal operations and therefore is considered a Development Stage Company.

Year-end - The Company’s year-end is November 30.

Use of estimates - The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the 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 revenue and expenses during the reporting period. Actual results could differ from those estimates.

Revenue and expense recognition - Revenues are recognized when received. Costs and expenses are recognized during the period in which they are incurred

Income taxes - The Company accounts for its income taxes in accordance with Statement of Financial Accounting Standards No. 109, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary 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 operations in the period that includes the enactment date.

Research and development costs - The Company accounts for research and development costs in accordance with the Statement of Financial Standards No. 2 “Accounting for Research and Development Costs”, which requires that all research and development costs must be charged to expense as incurred. Accordingly, internal research and development costs are expenses as incurred. Third party research and development costs are expenses when the contracted work has been performed or as milestone results have been achieved. Company-sponsored research and development costs related to both present and future
 
 
products are expensed in the period incurred. The Company has incurred no expenses on research and development to date.

Mineral Property Payments and Exploration Costs - The Company expenses all costs related to the acquisition, maintenance and exploration of mineral claims in which it has secured exploration rights prior to the establishment of proven and probable reserves. To date, the Company has not established the commercial feasibility of its exploration prospects; therefore, all costs are to be expensed.

Unaudited 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 August 31, 2007 and for all periods presented have been made.

2.  CAPITAL STOCK TRANSACTIONS
 
Common Stock - The authorized common stock is 50,000,000 shares with a par value of $0.001 per share. As of November 30, 2006, The Company had 1,390,000 shares of common stock issued and outstanding.

In September 2006, the Company issued 1,000,000 shares of its common stock to its director in exchange for a reduction in debt owed of $125 and $875 in cash

In November 2006, the Company issued 390,000 shares of its common stock to thirty-nine individuals in exchange for $39,000 in cash.
 
3.  GOING CONCERN

The Company's financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plans to obtain such resources for the Company include (1) obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses, and (2) seeking out and completing a merger with an existing operating company. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
 
 
Item 2.     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” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. We intend such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of complying with those safe-harbor provisions. 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. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Further information concerning our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.

Abandonment of Vulture Mineral Claims

We were incorporated on July 19, 2006 under the laws of the State of Nevada. Until the current reporting period, we were an exploration stage company engaged in the exploration of mineral properties. We acquired an option to purchase an interest in mineral claims referred to as the Vulture mineral claims. Our plan of operations was to carry out exploration work on these claims in order to ascertain whether they possess commercially exploitable quantities of copper, lead, zinc, gold, and other metallic minerals.

During the current reporting period, we commenced exploration activities on the Vulture mineral claims. Specifically, we conducted a soil geochemistry program under the guidance of our geological consultant, Mr. Marvin A. Mitchell. The results of this program were discouraging. In his report, Mr. Mitchell reports that the program failed to detect significant anomalous values of exploitable minerals. As such, no additional exploration was recommended at this time.

Based on the recommendations of our consulting geologist, we have decided to abandon our exploration program on the Vulture mineral claims. As such, we will lose all interest in the option that we acquired on the property.


Plan of Operation in the Next 12 Months

During the next twelve months, we intend to conduct a review of our current operating structure and to seek out and evaluate alternative business opportunities. We have not yet identified any suitable business opportunities and there is no assurance that we will be able to do so in the future. Even if we are able to identify suitable business opportunities, there are no assurances that we will be able to acquire an interest in those opportunities or that we will have the resources to pursue such opportunities. As such, an investment in our shares at this time would be highly speculative.

Because we have not identified an alternate business opportunity, we are unable to provide an estimate of our exact financial needs for the next twelve months. We have limited working capital of $3,725 as of August 31, 2007. As such, we will require substantial additional financing in the near future in order to meet our current obligations and to continue our operations. In addition, in the event that we are successful in identifying suitable alternative business opportunities, of which there is no assurance, we anticipate that we will need to obtain additional financing in order to pursue those opportunities.

Because we do not currently have a specific business plan or identified any suitable alternative business opportunities, our ability to obtain additional financing is substantially limited. If sufficient financing is not available or obtainable, we may not be able to continue as a going concern and investors may lose a substantial portion or all of their investment. We currently do not have any financing arrangements in place and there are no assurances that we will be able to acquire financing on acceptable terms or at all.

Results of Operations for the three and nine months ended August 31, 2007

We did not earn any revenues from inception through the period ending August 31, 2007. We do not anticipate earning revenues until such time that we are able to secure a successful business opportunity.

We incurred operating expenses in the amount of $4,302 for the three months ended August 31, 2007, $34,837 for the nine months ended May 31, 2007, and $36,275 from our inception on July 20, 2006 to August 31, 2007. The operating expenses for the three months ended August 31, 2007 included professional fees in the amount of $4,035, and general and administrative expenses in the amount of $267. The operating expenses for the nine months ended August 31, 2007 included professional fees in the amount of $19,202, and general and administrative expenses in the amount of $15,635. The operating expenses for the period from our inception on July 20, 2006 to August 31, 2007 included professional fees in the amount of $19,563, and general and administrative expenses in the amount of $16,712. The professional fees consisted of legal fees and accounting fees.

We incurred a net loss of $4,302 for the three months ended August 31, 2007 and $34,837 for the nine months ended August 31, 2007. We incurred a net loss of $36,275 from our inception on July 20, 2006 through period ending August 31, 2007. Our losses for the three and nine months ended August 31, 2007 are attributable to operating expenses.


Liquidity and Capital Resources

We had cash of $4,226 as our only current asset as of August 31, 2007. We had current liabilities of $501 as of August 31, 2007. We therefore had working capital of $3,725 as of August 31, 2007.

We have not attained profitable operations and are dependent upon obtaining financing to pursue any business opportunity. Our auditors stated in their report that they have substantial doubt we will be able to continue as a going concern.

Off Balance Sheet Arrangements

As of August 31, 2007, there were no off balance sheet arrangements.

Going Concern
 
Our financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. We have not yet established an ongoing source of revenues sufficient to cover our operating costs and allow us to continue as a going concern. The ability of us to continue as a going concern is dependent on us obtaining adequate capital to fund operating losses until we become profitable. If we are unable to obtain adequate capital, we could be forced to cease operations.

In order to continue as a going concern, we will need, among other things, additional capital resources. Management's plans to obtain such resources for us include (1) obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses, and (2) seeking out and completing a merger with an existing operating company. However, management cannot provide any assurances that we will be successful in accomplishing any of our plans.

Our ability to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.


Item 3.     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 August 31, 2007. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer, Mr. Donald L. Sampson. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of August 31, 2007, our disclosure controls and procedures are effective. There have been no changes in our internal controls over financial reporting during the quarter ended August 31, 2007.

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. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving our objectives and our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective at that reasonable assurance level. 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.


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 2.     Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3.     Defaults upon Senior Securities

None

Item 4.     Submission of Matters to a Vote of Security Holders

No matters have been submitted to our security holders for a vote, through the solicitation of proxies or otherwise, during the quarterly period ended August 31, 2007.

Item 5.     Other Information

None

Item 6.      Exhibits

(1)  
Previously included as an exhibit to the Registration Statement on Form SB-2 filed on January 18, 2007


SIGNATURES

In accordance with the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
Cody Resources, Inc.
   
Date:
October 15, 2007
   
 
By:       /s/ Donald Sampson    
             Donald L. Sampson
Title:    Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer and Director