Attached files
| file | filename |
|---|---|
| EX-31.1 - Jetblack Corp | ex31-1.htm |
| EX-32.2 - Jetblack Corp | ex32-2.htm |
| EX-32.1 - Jetblack Corp | ex32-1.htm |
| EX-31.2 - Jetblack Corp | ex31-2.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
(Mark
One)
|
[X]
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the
fiscal year ended August
31, 2009
|
[ ]
|
TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the transition period
from [ ]
to [ ]
Commission
file number 333-102945
|
Tortuga
Mexican Imports, Inc.
|
|
(Name
of small business issuer in its
charter)
|
|
Nevada
|
98-0379431
|
|
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
|
Suite
219 - 10654 82 Ave NW,
Edmonton,
Alberta, Canada
|
T6E
2A7
|
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Issuer's
telephone number (780) 710-9840
Securities
registered pursuant to Section 12(b) of the Act:
|
Title
of each class
Nil
|
Name
of each exchange on which registered
Nil
|
Securities
registered pursuant to Section 12(g) of the Act:
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Common
Shares, par value $0.001
|
|
(Title
of class)
|
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 large accelerated filer, an accelerated
filer, a non-accelerated filer, or a smaller reporting company. See the
definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
|
Large
accelerated filer ¨
|
Accelerated
filer ¨
|
|
Non-accelerated
filer “ (Do not check if a smaller reporting
company)
|
Smaller
reporting company X
|
Check if
there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. [ ]
State
issuer’s revenues for its most recent fiscal year. $0
State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold, or the average bid and asked prices of such common equity, as of a
specified date within 60 days. (See definition of affiliate in Rule
12b-2 of the Exchange Act.)
N/A
State the
number of shares outstanding of each of the issuer’s classes of equity stock, as
of the latest practicable date.
25,185,450 common shares
issued and outstanding as of December 14, 2009.
Transitional
Small Business Disclosure Format (Check one): Yes
[ ]; No [X]
Check
whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act). . Yes [ ] No [X]
PART
I
Item
1. Description
of Business.
This
annual report contains forward-looking statements as that term is defined in the
Private Securities Litigation Reform Act of 1995. These statements
relate to future events or our future financial performance. In some
cases, you can identify forward-looking statements by terminology such as "may",
"should", "expects", "plans", "anticipates", "believes", "estimates",
"predicts", "potential" or "continue" or the negative of these terms or other
comparable terminology. These statements are only predictions and
involve known and unknown risks, uncertainties and other factors, including the
risks in the section entitled "Risk Factors", that may cause our or our
industry's actual results, levels of activity, performance or achievements to be
materially different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking
statements.
Although
we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Except as required by applicable law, including the
securities laws of the United States, we do not intend to update any of the
forward-looking statements to conform these statements to actual
results.
Our
consolidated financial statements are stated in United States Dollars (US$) and
are prepared in accordance with United States Generally Accepted Accounting
Principles.
In this
annual report, unless otherwise specified, all dollar amounts are expressed in
United States dollars. All references "common shares" refer to the
common shares in our capital stock.
As used
in this annual report, the terms "we", "us", "our", and "Tortuga" mean Tortuga
Mexican Imports, Inc., unless otherwise indicated.
Our
Business – General
We were
incorporated on April 17, 2002, under the laws of the State of
Nevada. We have commenced limited operations, and have
generated revenue of $7,569 to date. We are still a development stage
corporation.
We have
launched our e-commerce site on the Internet for the purpose of engaging in the
business of selling jewelry and crafts online. Our website is located
at www.shoptortuga.com. Our
initial website was located at www.tortuga-imports.com.
This website has a link to our new recently launched website. Our website
currently offers jewelry designed by our President, Vanessa Avila. Our jewelry
is also currently for sale in select retail locations in Edmonton and Vancouver.
We have imported jewelry and crafts to date but have not yet imported any
furniture. We also import various materials, primarily silverware,
which our President, Vanessa Avila, designs into jewelry which we offer for
sale.
We also
intend to distribute detailed catalogues of fine Mexican furniture and crafts to
interior designers, retailers and decorators in the Province of Alberta,
Canada. We are currently reviewing when to commence production of the
catalogues.
Properties
Our
offices are located at Suite 219-10654 82nd
Avenue SW, Edmonton, Alberta T6E 4A7. We conduct all of our executive and
administrative functions and ship our products to our customers from this
facility. Our office space is an office sharing arrangement being provided as an
accommodation to us by a business associate of Ms. Avila.We are currently
actively searching for new lease office and warehouse space. We will require a
location that provides us with the space necessary to store inventory, package
and label our products, and for office administration. We anticipate locating a
suitable facility in the near future. Our telephone number is (780)
710-9840.
3
History
From 1995
to 1997, Ms. Avila, one of our directors, traveled extensively throughout the
country of Mexico. During this time, Ms. Avila came in contact with
various producers of fine furniture, jewelry and Mexican crafts. Ms.
Avila was impressed by the opportunity she saw to obtain exceptional Mexican
furniture, jewelry and crafts and affect its reliable delivery to international
buyers. Initially Ms. Avila was traveling throughout Mexico in
pursuit of personal purchases. However, Ms. Avila soon realized that
there was an opportunity to export these fine products abroad. Ms.
Avila cultivated relationships and contacts with various producers throughout
Mexico.
In the
last two years, Ms. Avila has traveled extensively in Mexico and met a wide
variety of individuals and companies that are offering products we intend to
sell through our catalogues and on our e-commerce site.
Our
business plan is to offer Mexican jewelry, furniture and crafts. Originally we
intended to immediately commence the purchasing of furniture, crafts and
jewelry, including the production of a detailed colour catalogue of furniture
after the completion of our SB-2 offering. However, we have conducted market
research since then and, based in large part on the positive response to the
limited quantities of jewelry we have imported and sold, we have determined that
we will initially focus on the sale of jewelry on our website and may not
immediately commence the importation of furniture and the production of a
catalogue. In addition, we plan on offering our jewelry in select third party
retail locations. Our original business plan did not contemplate
selling our jewelry in third party retail locations.
We raised
a total of $68,450 pursuant to our SB-2 registration statement, which was
declared effective on February 22, 2005. We closed the offering on August 22,
2005. During the year ended August 31, 2008, we raised
$15,000. In November 2008, we raised an additional
$15,000. On December 10, 2009 the Company received $25,000 for subscriptions for
250,000 shares at $0.10 per share. The shares have not been issued. Management
did not purchase shares. We have now commenced operations.
Current
Business Operations
We have
commenced operations. We recently launched a new e-commerce website
at www.shoptortuga.com .
We have also placed our jewelry, designed by our President, Vanessa Avila, in a
few select retail locations in Edmonton and Vancouver. In addition,
our jewelry is also available at the Aydin Gallery located in the Tinsletown
Mall in Vancouver. The jewelry has been placed on a consignment
basis. We are also currently reviewing when we will develop
catalogues featuring our jewelry along with Mexican furniture and crafts. We
intend to distribute the catalogues to retailers, interior designers and
decorators.
We
commenced sales of our products through our e-commerce website in June 2006. Our
website accepts payment by credit card. We have generated limited sales to date
from the sale of our jewelry by our President, Vanessa Avila. Ms. Avila sold the
jewelry to friends, work colleagues and at a temporary booth on the campus of
the University of Calgary in Calgary, Alberta. We have generated
$7,569 in revenues to date.
On June
1, 2006 The Company acquired Tortuga Canada, a Canadian private Company wholly
owned by the President of the Company, Ms. Avila. Before the acquisition the
Company was indebted to Tortuga Canada for $580. Upon acquisition the Company
issued Tortuga Canada 49,950 common shares at $0.10 per share, which was the
price of the Company’s latest private placement, for a total of $555 with the
residual of the debt forgiven by Tortuga Canada.
Products
Jewelry
Our
jewelry will be comprised of various materials, however; we intend to
incorporate silverware into the majority of the pieces we offer. The silverware
will be purchased primarily from the town of Taxco, in the State of Guerrero,
Mexico. The silverware we offer is characterized by diversity of
design, high quality and originality. We offer unique necklaces,
bracelets, earrings, rings, broaches, pendants, ornaments, cufflinks and key
rings. Each piece of our silver is stamped with a
“925”. This certification means that there are 925 parts of silver in
every 1000 parts of its metal content.
We
will also use semi-precious gemstones and an eclectic mix of beads and leather
and silver in our jewelry.
4
Furniture
We will
also offer a unique line of rustic Mexican furniture. Our management
will determine when we commence the import of furniture. We intend to
offer a variety of different furniture items, including the following types of
furniture: armoires, coffee and sofa tables, dining room sets, desks and
beds. The furniture will be characterized by the following finishes
and features: hammered copper, old reclaimed pine and forged or wrought
iron.
We
anticipate acquiring many of our craft products from Fonart, a Mexican
government organization that promotes Mexican artisans and sells their products.
However, we have not yet reached any agreement or understanding with this
supplier. In addition, we anticipate that the majority of furniture
items will be supplied from various suppliers in Puebla, Mexico. We
have not yet reached any agreements or understandings with such
suppliers.
Crafts
We will
also offer various crafts including paper mache and ceramics from the State of
Jalisco and elsewhere and hand blown glassware.
We
anticipate acquiring the majority of our craft products from individuals and
family run enterprises in addition to Fonart, a Mexican government organization
that promotes Mexican artisans and sells their wares. We have not yet
reached any agreement or understanding with this supplier.
Marketing,
Advertising and Promotion
We intend
to pursue strategic advertising and marketing campaigns. We intend to
implement an aggressive online advertising and marketing campaign to increase
awareness of our name and to acquire new customers through multiple channels,
including traditional and online advertising, direct marketing and expansion and
strengthening of strategic relationships. Initially, we will
concentrate our efforts on the sale of jewelry on our e-commerce website www.shoptortuga.com
and in select third party retail locations. We will seek to promote
its website and attract visitors to it by becoming predominant on major search
engines and banner advertisements on highly trafficked web sites that appeal to
our target audience. In addition, we will promote our website and our
products by conventional advertising and marketing. In November, 2005
some of our jewelry designed by our President Vanessa Avila was featured in a
fashion show during Fashion Week Vancouver 2005. In June 2006, we
commenced online sales of our products on our website.
Once we
have produced our catalogues, we intend to use traditional and non-traditional
methods of marketing for our catalogues. We will distribute our
catalogues to interior designers, decorators, retailers and wholesalers. We will
also seek out strategic relationships with interior designers in hopes of
finding common designing ground to incorporate our products into their client
design recommendations.
Competition
The
Mexican jewelry, furniture and crafts market is highly
fragmented. In addition, the online commerce market in which we
operate is new, rapidly evolving and highly competitive. We expect competition
to intensify in the future because current and new competitors can launch web
sites at a relatively low cost.
5
There are
not a significant number of online providers of unique Mexican furniture,
jewelry and crafts. Our principal competitor will be retail sellers
of Mexican products. One of the principle obstacles will be the
primary method consumers purchase furniture, that is, in person where products
can be touched and viewed in various lighting. We believe we can
overcome this disadvantage based on: (a) our competitive pricing; and (b) the
unique products we offer which are not available at retail outlets; and (c) the
educational and informative shopping experience we intend to
create.
The
products we intend to offer are readily available in Mexico. We will
allow the customer to select from a wide range of products from various regions
of Mexico from their own home as opposed to traveling to Mexico. Most
of the small suppliers from whom we intend to purchase are not equipped to offer
products online.
Government
Regulation and Supervision
Our
operations are subject to the effects of international treaties and regulations
especially the North American Free Trade Agreement (NAFTA) to which both Canada
and Mexico are parties. We are also subject to the effects of international
trade agreements and embargoes by entities such as the World Trade Organization,
especially from the purchase of goods from our e-commerce website. Generally,
these international trade agreements benefit our business rather than burden it
because they tend to reduce trade quotas, duties, taxes and similar impositions.
However, these trade agreements may also impose restrictions that could have an
adverse impact on our business, by limiting the countries from whom we can
purchase our fabric or other component materials, or limiting the countries
where we might market and sell our products. Also, because we import
all of our products from Mexico, any negative changes to NAFTA would have an
adverse effect our business.
Product
Research and Development
We do not
anticipate that we will expend any significant funds on research and development
over the twelve months ending August 31, 2010.
Employees
Currently
there are no full time or part-time employees of our company. However, our
president, Vanessa Avila, is a full time consultant of our company, and our
treasurer and chief financial officer, Eduardo Avila, is a part time consultant
of our company. We do not expect an increase in the number of employees over the
next 12 month period. If business is successful and we experience rapid growth,
our current officers and directors may be required to hire new personnel to
improve, implement and administer our operational, management, financial and
accounting systems.
Purchase
or Sale of Equipment
Other
than purchasing computer and office equipment necessary for operating our
business, we do not intend to purchase any significant equipment over the twelve
months ending August 31, 2010.
RISK
FACTORS
Much of
the information included in this quarterly report includes or is based upon
estimates, projections or other "forward-looking statements". Such
forward-looking statements include any projections or estimates made by us and
our management in connection with our business operations. While
these forward-looking statements, and any assumptions upon which they are based,
are made in good faith and reflect our current judgment regarding the direction
of our business, actual results will almost always vary, sometimes materially,
from any estimates, predictions, projections, assumptions, or other future
performance suggested herein. We undertake no obligation to update
forward-looking statements to reflect events or circumstances occurring after
the date of such statements.
Such
estimates, projections or other "forward-looking statements" involve various
risks and uncertainties as outlined below. We caution readers of this
quarterly report that important factors in some cases have affected and, in the
future, could materially affect actual results and cause actual results to
differ materially from the results expressed in any such estimates, projections
or other "forward-looking statements". In evaluating us, our business
and any investment in our business, readers should carefully consider the
following factors.
6
We
are in the early stages of our growth and we have only just begun to earn
revenue, which makes it difficult to evaluate whether we will operate
profitably.
We are in
the early stages of the growth of our company, which is involved primarily in
the import, design and sale of jewelry, crafts and furniture. As a result, we do
not have a meaningful historical record of sales and revenues nor an established
business track record. We have only recently begun to earn
revenues.
Unanticipated
problems, expenses and delays are frequently encountered in ramping up
production and sales and developing new products, especially in the current
stage of our business. Our ability to continue to successfully develop, produce
and sell our products and to generate significant operating revenues will depend
on our ability to, among other things:
|
•
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Continue
to successfully import Mexican jewelry, crafts and furniture;
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|
|
•
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successfully
market, distribute and sell our products or enter into agreements with
third parties to perform these functions on our behalf; and
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|
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•
|
obtain
the additional financing that may be required to fully implement our
business plan.
|
|
Given our
limited operating history, lack of long-term sales history and other sources of
revenue, there can be no assurance that we will be able to achieve any of these
goals and develop a sufficiently large customer base to be
profitable.
During
the year ended August 31, 2005 we raised $68,450 of equity capital pursuant to
our SB-2 Registration Statement. During the year ended August 31,
2008, we raised $15,000. In November 2008 we raised an additional
$15,000. In December 2009, we raised $25,000. The future
of our company will depend upon our ability to continue to obtain adequate
orders for our products and prompt payment for our products. To the extent that
we cannot achieve our plans and generate revenues which exceed expenses on a
consistent basis and in a timely manner, our business, results of operations,
financial condition and prospects could be materially adversely
affected.
We
depend on third party shippers to deliver our products in a timely manner and as
such we are subject to delays which are out of our control and may lead to a
loss of business.
For the
most part, our customers cannot visit physical stores to pick up our products.
Our product distribution relies instead on third-party delivery services,
including the United States Postal Service, the Mexican Postal Service (Correos
de Mexico), Canada Post and United Parcel Service. Strikes and other
interruptions may delay the timely delivery of customer orders, and customers
may refuse to purchase our products because of this loss of
convenience.
We
have received a going concern opinion from our independent auditors
We have
received a going concern opinion from our independent auditors LBB &
Associates Ltd., LLP, concerning our August 31, 2009 consolidated
financial statements. The independent auditor’s report accompanying our August
31, 2009 consolidated financial statements contains an explanatory paragraph
raising substantial doubt about our ability to continue as a going concern. The
financial statements have been prepared “assuming that the Company 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. Our
ability to continue as a going concern is dependent on raising additional
capital to fund our operations and ultimately on generating future profitable
operations. There can be no assurance that we will be able to raise sufficient
additional capital or eventually have positive cash flow from operations to
address all of our cash flow needs. If we are not able to find alternative
sources of cash or generate positive cash flow from operations, our business and
shareholders will be materially and adversely affected.
7
We
may not have access to all of the products we need to start and maintain a
business providing furniture, jewelry and crafts and we do not have any
contracts with suppliers and we may have to slow or cease operations if we fail
to secure an adequate supply of products.
Competition
and unforeseen limited sources of product in the industry could result in
occasional shortages of inventory. We do not have any firm contracts
with any suppliers of furniture, silverware or crafts. We intend to
sell our products without entering into any formal contracts with suppliers. We
may have to slow or cease operations if we fail to secure an adequate supply of
products.
Government
regulation and supervision could restrict our business.
Any
negative changes to international trade agreements and regulations especially
NAFTA or any agreements affecting international trade such as those made by the
World Trade Organization which result in a rise in trade quotas, duties, taxes
and similar impositions , or limiting the countries where we might market and
sell our products, could have an adverse effect on our business. We
import all of our products from Mexico and any negative changes to NAFTA, to
which both Canada and Mexico are signatories, would have an adverse effect on
our business.
Because
our directors have foreign addresses this may create potential difficulties
relating to service of process in the event that you wish to serve them with
legal documents.
Neither
of our current directors and officers have resident addresses in the United
States. One of our current directors is resident in Canada and the other is
resident in Mexico. Because our officers and directors have foreign addresses
this may create potential difficulties relating to the service of legal or other
documents on any of them in the event that you wish to serve them with legal
documents. This is because the laws related to service of process may differ
between Canada, Mexico and the US. Similar difficulties could not be encountered
in serving the company, proper, since our registered address is located in the
United States at 880 - 50 West Liberty Street, Reno, Nevada, 89501.
Because
the SEC imposes additional sales practice requirements on brokers who deal in
our shares which are penny stocks, some brokers may be unwilling to
trade them. This means that you may have difficulty in reselling your shares and
may cause the price of the shares to decline.
Our
shares qualify as penny stocks and are covered by Section 15(g) of the
Securities Exchange Act of 1934 which imposes additional sales practice
requirements on broker/dealers who sell our securities in this offering or in
the aftermarket. For sales of our securities, the broker/dealer must make a
special suitability determination and receive from you a written agreement prior
to making a sale to you. Because of the imposition of the foregoing additional
sales practices, it is possible that brokers will not want to make a market in
our shares. This could prevent you from reselling your shares and may cause the
price of the shares to decline.
Ms.
Avila owns more than 50% of the outstanding shares of our company, so she is
able to decide who are the directors and you may not be able to elect any
directors.
Ms. Avila
owns more than 50% of the issued and outstanding shares of our company and
because of this she is able to elect all of our directors and control our
operations.
The
loss of Ms. Vanessa Avila or other key management personnel would have an
adverse impact on our future development and could impair our ability to
succeed.
Our
performance is substantially dependent upon the expertise of our President, Ms.
Vanessa Avila, and other key management personnel, and our ability to continue
to hire and retain personnel. Ms. Avila spends some of her time working with our
company. It may be difficult to find sufficiently qualified individuals to
replace Ms. Avila or other key management personnel if we were to lose any
one or more of them. The loss of Ms. Avila or any of our key management
personnel could have a material adverse effect on our business, development,
financial condition, and operating results.
We do not
maintain “key person” life insurance on any of our directors or senior executive
officers.
8
We
do not expect to declare or pay any dividends.
We have
not declared or paid any dividends on our common stock since our inception, and
we do not anticipate paying any such dividends for the foreseeable
future.
Item
2. Description
of Property.
Our
administrative office is located at Suite 219-10654 82nd
Avenue NW, Edmonton, Alberta, T6E 2A7 and our telephone number is (780)
710-9840. We are currently actively searching for new lease office and warehouse
space. We will require a location that provides us with the space necessary to
store inventory, package and label our products, and for office administration.
We have two website addresses, our original site www.tortuga-imports.com
as well as our new site www.shoptortuga.com.
Item
3. Legal
Proceedings.
We know
of no material, active or pending legal proceedings against us, nor are we
involved as a plaintiff in any material proceedings or pending
litigation. There are no proceedings in which any of our directors,
officers or affiliates, or any registered beneficial shareholder are an adverse
party or has a material interest adverse to us.
Item
4. Submissions
of Matters to a Vote of Security Holders.
None.
PART
II
Item
5. Market
for Common Equity and Related Stockholder Matters.
As of
November 29, 2009 there were 58 holders of record of our common stock. As of
such date, 25,185,450 common shares were issued and outstanding. Our
common stock is quoted on the Over-the-Counter Bulletin Board under the symbol
“TTGX”.
On April
9, 2007, our Board of Directors approved a nine (9) for one (1) forward stock
split of our authorized, issued and outstanding shares of common
stock. We amended our Articles of Incorporation by the filing of a
Certificate of Change with the Nevada Secretary of State wherein we stated that
our Corporation will issue nine (9) shares for every one (1) share of common
stock issued and outstanding immediately prior to the effective date of the
forward stock split. The change in our Articles of Incorporation was effected
with the Nevada Secretary of State on March 1, 2007. As a result, our authorized
capital has increased from 25,000,000 to 225,000,000 shares of common stock with
a par value of $0.001 each. We issued nine (9) shares of common stock
in exchange for every one (1) share of common stock issued and
outstanding. This increased our issued and outstanding share capital
from 2,790,050 shares of common stock to 25,110,450 shares of common
stock.
Empire
Stock Transfer, Las Vegas, Nevada 89128-8380 (Telephone: 702-988-1242;
Facsimile: 702-988-1244) is the registrar and transfer agent for our common
shares.
9
There are
no outstanding options or warrants to purchase, or securities convertible into,
our common shares. We have not declared any dividends since
incorporation and do not anticipate that we will do so in the foreseeable
future. Although there are no restrictions that limit the ability to
pay dividends on our common shares, our intention is to retain future earnings
for use in our operations and the expansion of our business.
Recent
Sales of Unregistered Securities
There
have been no recent sales of unregistered securities.
Item
6. Selected
Financial Data.
Not
required.
Item
7. Management
Discussion and Analysis and Plan of Operation.
Results
of Operations.
For the
year ending August 31, 2009 we posted losses of $13,485 as compared to losses of
$27,042 for the
year ended August 31, 2008. Inception through August 31, 2009 losses total
$120,673. General and administrative expenses are the principal component of our
losses since inception.
Financial
Condition, Liquidity and Capital Resources
At August
31, 2009, we had cash of $4.
At
August 31, 2009 our total assets were $4.
As of
August 31, 2009, our total liabilities were $19,572 comprised primarily of
accounts payable and accrued expenses. This compares to our total
liabilities of $21,241 at August 31, 2008.
Cash
Requirements
Over the
next twelve months we intend to raise funds to commence marketing our products,
purchasing product inventory and for general and administrative expenditures, as
follows:
Estimated Funding Required
During the Next Twelve Months
|
General
and Administrative
|
$ | 10,000 | ||
|
Operations
|
||||
|
Website
Development and Promotion
|
$ | 2,500 | ||
|
Working
Capital
|
$ | 15,000 | ||
|
Total
|
$ | 27,500 |
10
As of
August 31, 2009, we had negative working capital of $19,568. We will require
additional financing before we generate significant revenues. We intend to raise
the capital required to meet any additional needs through sales of our
securities in secondary offerings or private placements. On December
10, 2009 we raised $25,000 through the sale of 250,000 shares of stock at $0.10
per share. In the year ended August 31, 2008, we raised $15,000
through the sale of 75,000 shares of stock at a price of $0.20 per
share. In November 2008 we raised an additional $15,000 by selling
75,000 shares of common stock at a price of $0.20 per share. We
completed a financing in which we raised $68,450 pursuant to an SB-2
registration statement, declared effective February 22, 2005, by selling
6,160,500 shares of common stock at a price of $0.10 per share.
On June
1, 2006 The Company acquired Tortuga Canada, a Canadian private Company wholly
owned by the President of the Company, Ms. Avila. Before the acquisition the
Company was indebted to Tortuga Canada for $580. Upon acquisition the Company
issued Tortuga Canada 49,950 common shares at $0.10 per share, which was the
price of the Company’s latest private placement, for a total of $555 with the
residual of the debt forgiven by Tortuga Canada.
There are
no assurances that we will be able to obtain additional funds required for our
continued operations. In such event that we do not raise sufficient additional
funds by secondary offering or private placement, we will consider alternative
financing options, if any, or be forced to scale down or perhaps even cease our
operations.
Recently
Issued Accounting Standards
The
adoption of recently issued pronouncements is not expected to have a material
effect on our financial position or results of operation.
APPLICATION
OF CRITICAL ACCOUNTING POLICIES
Our consolidated
financial statements and accompanying notes are prepared in accordance with
generally accepted accounting principles in the United
States. Preparing financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets,
liabilities, revenue, and expenses. These estimates and assumptions are affected
by management’s application of accounting policies. We believe that
understanding the basis and nature of the estimates and assumptions involved
with the following aspects of our financial statements is critical to an
understanding of our financials.
Item
8. Financial
Statements.
Our
consolidated financial statements are stated in United States Dollars (US$) and
are prepared in accordance with United States Generally Accepted Accounting
Principles.
|
Report
of Independent Registered Public Accounting Firm, dated December 10,
2009.
|
F-1
|
|
Consolidated
Balance Sheets at August 31, 2009 and 2008.
|
F-2
|
|
Consolidated
Statements of Operations for the years ended August 31, 2009 and 2008, and
for the period from April 17, 2002 (inception) to August 31,
2009.
|
F-3
|
|
Consolidated
Statements of Stockholders’ Deficit from April 17, 2002 (inception) to
August 31, 2009.
|
F-4
|
|
Consolidated
Statements of Cash Flows for the years ended August 31, 2009 and 2008, and
the period from April 17, 2002 (inception) to August 31,
2009.
|
F-5
|
|
Notes
to the Consolidated Financial Statements
|
F-6 |
11
Report of Independent
Registered Public Accounting Firm
To the
Board of Directors of
Tortuga
Mexican Imports, Inc.
(A
Development Stage Company)
Edmonton,
Alberta Canada
We have
audited the accompanying consolidated balance sheets of Tortuga Mexican Imports,
Inc. (the “Company”) as of August 31, 2009 and 2008, and the related
consolidated statements of operations, stockholders' deficit, and cash flows for
each of the years then ended and for the period from April 17, 2002 (inception)
through August 31, 2009. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require
that we plan and perform the audits to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audits included
consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the Company’s
internal control over financial reporting. Accordingly, we express no
such opinion. An audit also includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our
opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the consolidated financial position of Tortuga Mexican
Imports, Inc. as of August 31, 2009 and 2008, and the results of its operations
and its cash flows for each of the years then ended and for the period from
April 17, 2002 (inception) through August 31, 2009, in conformity with
accounting principles generally accepted in the United States of
America.
As
discussed in Note 1 to the consolidated financial statements, the Company's
absence of significant revenues, recurring losses from operations, and its need
for additional financing in order to fund its projected loss in 2010 raise
substantial doubt about its ability to continue as a going concern. The 2009
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
LBB &
Associates Ltd., LLP
Houston,
Texas
December
10, 2009
F-1
TORTUGA
MEXICAN IMPORTS, INC.
(A
DEVELOPMENT STAGE COMPANY)
CONSOLIDATED
BALANCE SHEETS
|
August 31, 2009
|
August 31, 2008
|
|||||||
|
ASSETS
|
$ | $ | ||||||
|
CURRENT
ASSETS
|
||||||||
|
Cash
|
4 | 158 | ||||||
|
Total
Current Assets
|
4 | 158 | ||||||
|
Total
Assets
|
4 | 158 | ||||||
|
LIABILITIES
AND STOCKHOLDERS' DEFICIT
|
||||||||
|
LIABILITIES
|
||||||||
|
CURRENT
LIABILITIES
|
||||||||
|
Accounts
payable and accrued liabilities
|
15,572 | 21,241 | ||||||
|
Stockholder advance
|
4,000 | - | ||||||
|
Total
Current Liabilities
|
19,572 | 21,241 | ||||||
|
Total
Liabilities
|
19,572 | 21,241 | ||||||
|
STOCKHOLDERS' DEFICIT
|
||||||||
|
Common
stock, $.001 par value, 225,000,000 shares authorized,
25,185,450
shares issued and outstanding at August 31, 2009 and August 31,
2008
|
25,185 | 25,185 | ||||||
|
Additional
paid in capital
|
75,920 | 60,920 | ||||||
|
Deficit
accumulated during the development stage
|
(120,673 | ) | (107,188 | ) | ||||
|
Total
Stockholders’ Deficit
|
(19,568 | ) | (21,083 | ) | ||||
|
TOTAL
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
4 | 158 | ||||||
See
accompanying notes to consolidated financial statements.
F-2
TORTUGA
MEXICAN IMPORTS, INC.
(A
DEVELOPMENT STAGE COMPANY)
CONSOLIDATED
STATEMENTS OF OPERATIONS
Years
Ended August 31, 2009 and 2008 and the period
from
April 17, 2002 (Inception) through August 31, 2009
|
Year
Ended
August
31, 2009
|
Year
Ended
August
31, 2008
|
April
17, 2002 (Inception) to
August
31, 2009
|
||||||||||
| $ | $ | $ | ||||||||||
|
REVENUE
|
– | – | 7,569 | |||||||||
|
COST
OF GOODS SOLD
|
– | – | (1,333 | ) | ||||||||
|
GROSS
PROFIT
|
– | – | 6,236 | |||||||||
|
EXPENSES
|
||||||||||||
|
General
and administrative
|
13,485 | 27,042 | 126,909 | |||||||||
|
Total
Expenses
|
13,485 | 27,042 | 126,909 | |||||||||
|
NET
LOSS
|
(13,485 | ) | (27,042 | ) | (120,673 | ) | ||||||
|
NET
PROFIT (LOSS) PER SHARE:
BASIC
AND DILUTED
|
(0.00 | ) | (0.00 | ) | ||||||||
|
WEIGHTED
AVERAGE SHARES OUTSTANDING:
BASIC
AND DILUTED
|
25,185,450 | 25,166,598 | ||||||||||
See
accompanying notes to consolidated financial statements.
F-3
TORTUGA
MEXICAN IMPORTS, INC.
(A
DEVELOPMENT STAGE COMPANY)
CONSOLIDATED
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
For
the Period From April 17, 2002 (Inception) through August 31, 2009
|
Common
Stock
|
Additional
Paid-in Capital
|
Deficit
Accumulated during the Development Stage
|
Total
|
|||||||||||||||||
| Shares |
Amount
|
|||||||||||||||||||
|
Issuance
of common stock for cash
|
18,000,000 | $ | 18,000 | $ | (16,000 | ) | $ | – | $ | 2,000 | ||||||||||
|
Issuance
of common stock for services
|
900,000 | 900 | (800 | ) | – | 100 | ||||||||||||||
|
Net
loss
|
– | – | – | (2,124 | ) | (2,124 | ) | |||||||||||||
|
Balance,
August 31, 2002
|
18,900,000 | 18,900 | (16,800 | ) | (2,124 | ) | (24 | ) | ||||||||||||
|
Net
loss
|
– | – | – | (3,265 | ) | (3,265 | ) | |||||||||||||
|
Balance,
August 31, 2003
|
18,900,000 | 18,900 | (16,800 | ) | (5,389 | ) | (3,289 | ) | ||||||||||||
|
Net
loss
|
– | – | – | (10,673 | ) | (10,673 | ) | |||||||||||||
|
Balance,
August 31, 2004
|
18,900,000 | 18,900 | (16,800 | ) | (16,062 | ) | (13,962 | ) | ||||||||||||
|
Issuance
of common stock for cash
|
6,160,500 | 6,160 | 62,290 | – | 68,450 | |||||||||||||||
|
Net
loss
|
– | – | – | (6,866 | ) | (6,866 | ) | |||||||||||||
|
Balance,
August 31, 2005
|
25,060,500 | 25,060 | 45,490 | (22,928 | ) | 47,622 | ||||||||||||||
|
Issuance
of common stock for acquisition of subsidiary
|
49,950 | 50 | 505 | – | 555 | |||||||||||||||
|
Net
loss
|
– | – | – | (29,966 | ) | (29,966 | ) | |||||||||||||
|
Balance,
August 31, 2006
|
25,110,450 | 25,110 | 45,995 | (52,894 | ) | 18,211 | ||||||||||||||
|
Net
loss
|
– | – | – | (27,252 | ) | (27,252 | ) | |||||||||||||
|
Balance,
August 31, 2007
|
25,110,450 | 25,110 | 45,995 | (80,146 | ) | (9,041 | ) | |||||||||||||
|
Issuance
of common stock for cash
|
75,000 | 75 | 14,925 | – | 15,000 | |||||||||||||||
|
Net
loss
|
– | – | – | (27,042 | ) | (27,042 | ) | |||||||||||||
|
Balance,
August 31, 2008
|
25,185,450 | 25,185 | 60,920 | (107,188 | ) | (21,083 | ) | |||||||||||||
|
Subscription
received
|
– | – | 15,000 | – | 15,000 | |||||||||||||||
|
Net
loss
|
– | – | – | (13,485 | ) | (13,485 | ) | |||||||||||||
|
Balance,
August 31, 2009
|
25,185,450 | $ | 25,185 | $ | 75,920 | $ | (120,673 | ) | $ | (19,568 | ) | |||||||||
See
accompanying notes to consolidated financial statements.
F-4
TORTUGA
MEXICAN IMPORTS, INC.
(A
DEVELOPMENT STAGE COMPANY)
CONSOLIDATED
STATEMENTS OF CASH FLOWS
Years
Ended August 31, 2009 and 2008 and
Period
from April 17, 2002 (Inception) through August 31, 2009
|
Year
Ended
August
31, 2009
|
Year
Ended
August
31, 2008
|
April
17, 2002 (Inception) to
August
31, 2009
|
||||||||||
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||
|
Net
loss
|
$ | (13,485 | ) | $ | (27,042 | ) | $ | (120,673 | ) | |||
|
Adjustments
to reconcile net loss to cash used by
|
||||||||||||
|
operating
activities:
|
||||||||||||
|
Common
stock issued for services
|
– | – | 655 | |||||||||
|
Impairment
|
– | – | 1,800 | |||||||||
|
Change
in current assets and liabilities
|
||||||||||||
|
Inventory
|
– | – | (1,800 | ) | ||||||||
|
Accounts
payable and accrued expenses
|
(5,669 | ) | 12,100 | 15,572 | ||||||||
|
CASH
FLOWS USED IN OPERATING ACTIVITIES
|
(19,154 | ) | (14,942 | ) | (104,446 | ) | ||||||
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
|
Advances
from shareholders
|
4,000 | – | 4,000 | |||||||||
|
Issuance
of common stock
|
15,000 | 15,000 | 100,450 | |||||||||
|
CASH
FLOWS PROVIDED BY FINANCING
|
19,000 | 15,000 | 104,450 | |||||||||
|
ACTIVITIES
|
||||||||||||
|
NET
INCREASE (DECREASE) IN CASH
|
(154 | ) | 58 | 4 | ||||||||
|
Cash,
beginning of period
|
158 | 100 | – | |||||||||
|
Cash,
end of period
|
$ | 4 | $ | 158 | $ | 4 | ||||||
|
SUPPLEMENTAL
CASH FLOW INFORMATION
|
||||||||||||
|
Interest
paid
|
$ | – | $ | – | $ | – | ||||||
|
Income
taxes paid
|
$ | – | $ | – | $ | – | ||||||
See
accompanying notes to consolidated financial statements.
F-5
TORTUGA
MEXICAN IMPORTS, INC.
(A
DEVELOPMENT STAGE COMPANY)
Notes
to the Consolidated Financial Statements
NOTE
1 - NATURE OF BUSINESS
Tortuga
Mexican Imports, Inc. ("Tortuga" or "the Company") was incorporated in Nevada on
April 17, 2002, to sell jewelry, furniture and other Mexican handcrafted
products. On June 1, 2006 Tortuga acquired Tortuga Mexican Imports Canada Inc.
("Tortuga Canada"), a Canadian private company incorporated under the federal
laws of Canada. Tortuga Canada will be used for the purpose of marketing the
Company's products in Canada.
The
Company has evaluated subsequent events for recognition or disclosure through
the date these financial statements were available to be issued, December 10,
2009.
Going
concern
These
financial statements have been prepared in accordance with United States
generally accepted accounting principles, on a going concern basis, which
contemplates the realization of assets and the satisfaction of liabilities and
commitments in the normal course of business. At August 31, 2009, the Company
has working capital deficit of $19,568 and has incurred losses since inception
of $120,673. Further losses are anticipated in the development of its business
and there can be no assurance that the Company will be able to achieve or
maintain profitability.
The
continuing operations of the Company and the recoverability of the carrying
value of assets is dependent upon the ability of the Company to obtain necessary
financing to fund its working capital requirements, and upon future profitable
operations. The accompanying financial statements do not include any adjustments
relative to the recoverability and classification of asset carrying amounts or
the amount and classification of liabilities that might result from the outcome
of this uncertainty.
There can
be no assurance that capital will be available as necessary to meet the
Company's working capital requirements or, if the capital is available, that it
will be on terms acceptable to the Company. The issuances of additional equity
securities by the Company may result in dilution in the equity interests of its
current stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase the Company's liabilities and future cash commitments.
If the Company is unable to obtain financing in the amounts and on terms deemed
acceptable, the business and future success may be adversely
affected.
NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles
of Consolidation
The
consolidated financial statements include the accounts of the Company and its
wholly owned subsidiary. All significant inter-company transactions and balances
have been eliminated.
Cash
and Cash Equivalents
Cash and
cash equivalents are defined as cash on hand, demand deposits and short-term,
highly liquid investments with an original maturity of ninety days or
less.
Development
Stage Company
The
Company complies with Financial Accounting Standards Board Statement No. 7 and
Securities and Exchange Commission Act Guide 7 for its characterization of the
Company as development stage
F-6
Use
of Estimates
The
preparation of financial statements in conformity generally accepted accounting
principles in the United States requires management to make estimates and
assumptions that affect the reported amount of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amount of revenue and expenses during the period.
Actual results may differ from those estimates.
Basic
Loss per Share
Basic
loss per share has been calculated based on the weighted average number of
shares of common stock outstanding during the period.
Income
Taxes
The asset
and liability approach is used to account for income taxes by recognizing
deferred tax assets and liabilities for the expected future tax consequences of
temporary differences between the carrying amounts and the tax basis of assets
and liabilities. Tortuga records a valuation allowance to reduce the deferred
tax assets to the amount that is more likely than not to be
realized.
Financial
Instruments
Tortuga's
financial instruments consist of cash, accounts payable and advances from
shareholders. Unless otherwise noted, it is management's opinion that Tortuga is
not exposed to significant interest, currency or credit risks arising from these
financial instruments. Because of the short maturity of such assets and
liabilities the fair value of these financial instruments approximate their
carrying values, unless otherwise noted.
Inventory
Inventories
are valued at the lower of cost or market. Cost is determined by using the
average cost method. Inventories consist primarily of Mexican jewelry and
silverware. Tortuga determines its provision for obsolete and slow-moving
inventory based on management's analysis of inventory levels and future sales
forecasts.
Impairment
of Inventory
The
Company reviews inventory for indicators of impairment whenever events or
changes in circumstances indicate that the carrying value may not be
recoverable. If the review indicates that the carrying amount of the asset may
not be recoverable, the potential impairment is measured based on a projected
discounted cash flow method using a discount rate that is considered to be
commensurate with the risk inherent in the company's current business model.
During the years ended August 31, 2009 and 2008, the Company recorded no
impairment loss.
Revenue
Recognition
Tortuga
recognizes revenue when persuasive evidence of an arrangement exists, delivery
has occurred, the sales price is fixed or determinable and collectibility is
probable. These criteria are generally met at the time product is shipped or
services are performed.
All sales
are final and returns are not accepted. All sales are paid in cash at the time
the products are delivered.
Recent
Accounting Pronouncements
During
the year ended August 31, 2009 and subsequently, the Financial Accounting
Standards Board (“FASB”) has issued a number of financial accounting standards,
none of which did or are expected to have a material impact on the Company’s
results of operations, financial position, or cash flows, with exception
of:
F-7
New
Accounting Pronouncements (Adopted)
SFAS
No. 157. In September 2006, the FASB issued
SFAS No. 157, Fair
Value Measurements (“SFAS No. 157”). This statement defines fair
value, establishes a framework for measuring fair value in GAAP, and expands
disclosures about fair value measurements, but does not require any new fair
value measurements. SFAS No. 157 is effective for fiscal years beginning
after November 15, 2007, and interim periods within those fiscal years. In
February 2008, the FASB issued FASB Staff Position, or FSP, No. FAS 157-2,
Effective Date of FASB
Statement No. 157 (“FSP FAS 157-2”), which delayed the effective
date of SFAS No. 157 for certain nonfinancial assets and liabilities to
fiscal years beginning after November 15, 2008, and interim periods within
those fiscal years. We adopted SFAS No. 157 for the Company’s financial
assets and liabilities in the first quarter of fiscal 2009, and provisions for
nonfinancial assets and liabilities in the first quarter of fiscal 2010, which
did not result in recognition of a transaction adjustment to retained earnings
or have a material impact on our financial condition, results of operations or
cash flows.
SFAS
No. 165. In May 2009, the FASB issued SFAS
No. 165, Subsequent
Events (“SFAS No. 165”). This statement provides guidance to
establish general standards of accounting for and disclosure of events that
occur after the balance sheet date but before the financial statements are
issued or are available to be issued. This statement is effective for interim or
fiscal periods ending after June 15, 2009, and is applied prospectively. We
adopted SFAS No. 165 in the year ended August 31, 2009; this adoption did
not have any impact on our financial condition, results of operations or cash
flows.
New
Accounting Pronouncements (Not yet adopted)
SFAS
No. 168. In June 2009, the FASB issued SFAS
No. 168, The FASB
Accounting Standards Codification and the Hierarchy of Generally of Generally
Accepted Accounting Principles — a Replacement of FASB Statement
No. 162 (“SFAS No. 168”). SFAS No. 168 establishes the
FASB Accounting Standards Codification as the source of authoritative accounting
principles recognized by the FASB to be applied by nongovernmental entities in
the preparation of financial statements in conformity with GAAP. SFAS
No. 168 is effective for financial statements issued for interim and annual
periods ending after September 15, 2009. We do not expect the adoption of
SFAS No. 168 will not have a material impact on our financial condition,
results of operations or cash flows.
NOTE
3 - RELATED PARTY TRANSACTIONS
All
purchases and sales transactions for Tortuga are carried out by the Director and
President of the Company. Tortuga neither owns nor leases any real or personal
property; an officer has provided office services without charge. Such costs are
immaterial to the financial statements and accordingly are not reflected herein.
The officers and directors are involved in other business activities and most
likely will become involved in other business activities in the
future.
During
the year ended August 31, 2009 and August 31, 2008, the Company paid consulting
fees to a director in the amount of $nil and $4,000, respectively.
NOTE
4 – SHAREHOLDER ADVANCE
During
the year ended August 31, 2009 a shareholder of the Company advanced $4,000 to
the Company. There is no written loan agreement. Interest is accrued on these
advances at the rate of 10% per annum. As of August 31, 2009 the interest
accrued on the advances is $356. The advances and accrued interest are payable
on demand.
F-8
NOTE 5 - COMMON
STOCK
At
inception, Tortuga issued 18,900,000 shares of stock to its two founding
shareholders for $2,000 cash and $100 of services.
In July
2005, the Company raised $68,450 from the sale of 6,160,500 common shares
pursuant to the Company's SB-2 registration statement declared effective on
February 22, 2005. $950 of the cash payment for these shares was received in
October 2005.
In June
2006, the Company issued 49,950 shares of stock at the market value of $555 to
acquire Tortuga Canada.
On
January 30, 2007, the board of directors approved a nine (9) for one (1) forward
stock split of our authorized, issued and outstanding shares of common stock.
Tortuga amended its Articles of Incorporation by the filing of a Certificate of
Change with the Nevada Secretary of State wherein it stated that it would issue
nine shares for every one share of common stock issued and outstanding
immediately prior to the effective date of the forward stock split. The change
in the Articles of Incorporation was effected with the Nevada Secretary of State
on March 1, 2007. As a result, the authorized capital increased from 25,000,000
to 225,000,000 shares of common stock with a par value of $0.001. The stock
split is presented retroactively in these financial statements.
During
the year ended August 31, 2008 the Company issued 75,000 common shares at a
price of $0.20 per share for total proceeds of $15,000.
During
the year ended August 31, 2009 the Company received $15,000 for subscriptions
for 75,000 shares at $0.20 per share. The shares have not been
issued.
NOTE
6 - INCOME TAXES
Tortuga
follows Statement of Financial Accounting Standards Number 109 (SFAS 109),
"Accounting for Income Taxes." Deferred income taxes reflect the net effect of
(a) temporary difference between carrying amounts of assets and liabilities for
financial purposes and the amounts used for income tax reporting purposes, and
(b) net operating loss carryforwards. No net provision for refundable Federal
income tax has been made in the accompanying statement of loss because no
recoverable taxes were paid previously. Similarly, no deferred tax asset
attributable to the net operating loss carryforward has been recognized, as it
is not deemed likely to be realized.
The
provision for refundable Federal income tax consists of the
following:
|
August
31, 2009
|
August
31, 2008
|
|||||||
|
Refundable
Federal income tax attributable to:
|
||||||||
|
Current
Operations
|
$ | 4,500 | $ | 9,000 | ||||
|
Less,
Change in valuation allowance
|
(4,500 | ) | (9,000 | ) | ||||
|
Net
refundable amount
|
$ | – | $ | – | ||||
The
cumulative tax effect at the expected rate of 34% of significant items
comprising our net deferred tax amount is as follows:
|
August
31, 2009
|
August
31, 2008
|
|||||||
|
Deferred
tax asset attributable to:
|
||||||||
|
Net
operating loss carryover
|
$ | 40,500 | $ | 36,000 | ||||
|
Less,valuation
allowance
|
(40,500 | ) | (36,000 | ) | ||||
|
Net
deferred tax asset
|
$ | – | $ | – | ||||
At August
31, 2009, Tortuga had an unused net operating loss carryover approximating
$120,000 that is available to offset future taxable income, which expires
beginning in 2022.
NOTE
7- SUBSEQUENT EVENT
On
December 10, 2009 the Company received $25,000 for subscriptions for 250,000
shares at $0.10 per share. The shares have not been issued.
F-9
Item
9. Changes
In and Disagreements With Accountants on Accounting and Financial
Disclosure.
None
Item
9A. Controls
and Procedures.
We
maintain disclosure controls and procedures that are designed to ensure that
information required to be disclosed in our reports filed under the Securities
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms, and that such information is
accumulated and communicated to our management to allow for timely decisions
regarding required disclosure. In designing and evaluating our disclosure
controls and procedures, our management recognizes that any controls and
procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving the desired control objectives, and our
management is required to apply its judgment in evaluating the cost-benefit
relationship of possible controls and procedures.
Our
management does not expect that our disclosure controls or our internal controls
over financial reporting will prevent all error and fraud. A control system, no
matter how well conceived and operated, can provide only reasonable, but not
absolute, assurance that the objectives of a control system are met. Further,
any control system reflects limitations on resources and the benefits of a
control system must be considered relative to its costs. These limitations also
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 a control. A design of a control
system is also based upon certain assumptions about potential future conditions;
over time, controls may become inadequate because of changes in conditions, or
the degree of compliance with the policies or procedures may deteriorate.
Because of the inherent limitations in a cost-effective control system,
misstatements due to error or fraud may occur and may not be
detected.
As of
August 31, 2009, the year end period covered by this report, we carried out an
evaluation, under the supervision and with the participation of our management
of the effectiveness of the design and operation of our disclosure controls and
procedures. Based on the foregoing, we have concluded that our disclosure
controls and procedures were effective as of the end of the period covered by
this annual report. There have been no changes in our internal controls over
financial reporting that occurred during the fiscal year ended August 31, 2009
that have materially or are reasonably likely to materially affect, our internal
controls over financial reporting.
Management's Report on Internal
Control over Financial Reporting
Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f)
under the Exchange Act. Management has employed a framework consistent with
Exchange Act Rule 13a-15(c), to evaluate internal control over financial
reporting described below. Internal control over financial reporting is a
process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation and fair presentation of financial
statements for external purposes in accordance with generally accepted
accounting principals.
Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
Management
conducted an evaluation of the design and operation of our internal control over
financial reporting as of and for the year ended August 31, 2009. In
making this assessment, Management used the criteria set forth by the Committee
of Sponsoring Organizations of the Treadway Commission in Internal
Control-Integrated Framework. As a result of this assessment, management
concluded that, as of and for the year ended August 31, 2009, our internal
control over financial reporting was effective in providing reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles as of the year and quarter ended August 31,
2009.
12
This
annual report does not include an attestation report of the company's registered
public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by the company's registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the company to provide only management's report
in this annual report.
Item
9B. Other
Information
None.
PART
III
|
Item
10.
|
Directors,
Executive Officers, Promoters and Control Persons; Compliance with Section
16(a) of the Exchange Act.
|
Directors
and Executive Officers, Promoters and Control Persons
Our
directors, executive officers and other significant employees, their ages,
positions held and duration each person has held that position, are as
follows:
|
Name
|
Position
Held with the
Company
|
Age
|
Date
First Elected
or
Appointed
|
|
|
Vanessa
Avila
|
President,
Secretary & Director
|
33
|
April
17, 2002
|
|
|
Eduardo
Avila
|
Treasurer
& Director
|
35
|
October5,
2005
|
|
Business
Experience
The
following is a brief account of the education and business experience of each
director, executive officer and key employee during at least the past five
years, indicating each person's principal occupation during the period, and the
name and principal business of the organization by which he or she was
employed.
Vanessa
Avila, President, Secretary and Director
Since
April 17, 2002, Ms. Avila has been our president, secretary and a member of our
board of directors.
Ms. Avila
is currently a professor of Spanish at the University of British Columbia,
Vancouver, Canada.
13
Ms. Avila
completed a Masters degree in Linguistics at the University of Alberta in
2005.
From 2001
through to the summer of 2004, Ms. Avila was a Spanish instructor at the
University of Alberta in Edmonton, Canada teaching entry-level full credit
Spanish courses and upper level advanced courses.
From
1997 to 2001 Ms. Avila was attending the University of Alberta on a full time
basis. Ms. Avila graduated from the University of Alberta with a
Bachelors degree in Linguistics in June 2001.
Eduardo
Avila, Chief Executive Officer and Treasurer and Director
Since
October 5, 2005, Eduardo Avila has been our chief executive officer, treasurer
and member of our board of directors. Mr. Avila provides us with his
part-time consulting services.
Since
2006, Mr. Avila has been a chief economist at Monex, a stock brokerage firm in
Mexico City.
Since
2003, Mr. Avila was a chief economist at Prognosis, an economic analysis firm in
Mexico City. During this time, Mr. Avila has written part time
for latin financial magazine “Inversionista”.
Since
2000, Mr. Avila appears periodically on CNN Spanish
Edition.
From 1999
to 2003, Mr. Avila held the position of Chief Economist of the Interacciones
Financial Group (Grupo Financiero Interacciones) a Mexican stock
brokerage. During this period, Mr. Avila was the representative of
Interacciones in the Association of Mexican Financial Intermediaries (Asociacion
de Mexicana de Intermediarios Financieros) where he discussed and analyzed
economic issues and methodologies related to finance. Mr. Avila has
participated in various economic surveys including of note surveys conducted by:
Bloomberg, Reuters, Dow Jones, Latin-Focus and the Mexican newspaper
Reforma.
Mr. Avila
obtained a Degree in Economics from the Autonomous Technical Institute of Mexico
(ITAM) 1997.
Family
Relationships
Our
President and Secretary, Vanessa Avila, is the sister of our Chief Executive
Officer and Treasurer, Eduardo Avila.
Involvement
in Certain Legal Proceedings
Our
directors, executive officers and control persons have not been involved in any
of the following events during the past five years:
1. any
bankruptcy petition filed by or against any business of which such person was a
general partner or executive officer either at the time of the bankruptcy or
within two years prior to that time;
2. any
conviction in a criminal proceeding or being subject to a pending criminal
proceeding (excluding traffic violations and other minor offenses);
3. being
subject to any order, judgment, or decree, not subsequently reversed, suspended
or vacated, of any court of competent jurisdiction, permanently or temporarily
enjoining, barring, suspending or otherwise limiting his involvement in any type
of business, securities or banking activities; or
4. being
found by a court of competent jurisdiction (in a civil action), the Commission
or the Commodity Futures Trading Commission to have violated a federal or state
securities or commodities law, and the judgment has not been reversed,
suspended, or vacated.
14
Audit
Committee Financial Expert
Our Board
of Directors has determined that it does not have a member of its audit
committee that qualifies as an “audit committee financial expert” as defined in
Item 401(e) of Regulation S-B, and is “independent” as the term is used in Item
7(d)(3)(iv) of Schedule 14A under the Securities Exchange Act of 1934, as
amended.
We
believe that the members of our Board of Directors are collectively capable of
analyzing and evaluating our financial statements and understanding internal
controls and procedures for financial reporting. In addition, we
believe that retaining an independent director who would qualify as an “audit
committee financial expert” would be overly costly and burdensome and is not
warranted in our circumstances given the early stages of our development and the
fact that we have generated limited revenues to date.
Code
of Ethics
Effective
October 30, 2005, our company's board of directors adopted a Code of Business
Conduct and Ethics that applies to, among other persons, our company's president
(being our principal executive officer) and our company's secretary (being our
principal financial and accounting officer and controller), as well as persons
performing similar functions. As adopted, our Code of Business
Conduct and Ethics sets forth written standards that are designed to deter
wrongdoing and to promote:
(1)
honest and ethical conduct, including the ethical handling of actual or apparent
conflicts of interest between personal and professional
relationships;
(2) full,
fair, accurate, timely, and understandable disclosure in reports and documents
that we file with, or submit to, the Securities and Exchange Commission and in
other public communications made by us;
(3)
compliance with applicable governmental laws, rules and
regulations;
(4) the
prompt internal reporting of violations of the Code of Business Conduct and
Ethics to an appropriate person or persons identified in the Code of Business
Conduct and Ethics; and
(5)
accountability for adherence to the Code of Business Conduct and
Ethics.
Our Code
of Business Conduct and Ethics requires, among other things, that all of our
company's personnel shall be accorded full access to our president and secretary
with respect to any matter which may arise relating to the Code of Business
Conduct and Ethics. Further, all of our company's personnel are to be
accorded full access to our company's board of directors if any such matter
involves an alleged breach of the Code of Business Conduct and Ethics by our
president or secretary.
In
addition, our Code of Business Conduct and Ethics emphasizes that all employees,
and particularly managers and/or supervisors, have a responsibility for
maintaining financial integrity within our company, consistent with generally
accepted accounting principles, and federal, provincial and state securities
laws. Any employee who becomes aware of any incidents involving financial or
accounting manipulation or other irregularities, whether by witnessing the
incident or being told of it, must report it to his or her immediate supervisor
or to our company's president or secretary. If the incident involves
an alleged breach of the Code of Business Conduct and Ethics by the president or
secretary, the incident must be reported to any member of our board of
directors. Any failure to report such inappropriate or irregular
conduct of others is to be treated as a severe disciplinary
matter. It is against our company policy to retaliate against any
individual who reports in good faith the violation or potential violation of our
company's Code of Business Conduct and Ethics by another.
Our Code of Business Conduct and
Ethics is filed herewith with the Securities and Exchange Commission as
Exhibit 14.1 to this annual report. We will provide a copy of the
Code of Business Conduct and Ethics to any person without charge, upon
request. Requests can be sent to: Tortuga Mexican Imports Inc., Suite
219 - 10654 82 Ave NW, Edmonton, Alberta, Canada T6E 2A7.
15
Section
16(a) Beneficial Ownership Compliance
Section
16(a) of the Securities Exchange Act of 1934, as amended, requires our executive
officers and directors and persons who own more than 10% of a registered class
of our equity securities to file with the Securities and Exchange Commission
initial statements of beneficial ownership, reports of changes in ownership and
annual reports concerning their ownership of our common stock and other equity
securities, on Forms 3, 4 and 5 respectively. Executive officers,
directors and greater than 10% shareholders are required by the Securities and
Exchange Commission regulations to furnish us with copies of all Section 16(a)
reports they file.
To the
best of our knowledge, all executive officers, directors and greater than 10%
shareholders filed the required reports in a timely manner.
Item
11. Executive
Compensation.
Vanessa
Avila received nil in cash or other compensation during the fiscal years ended
August 31, 2009 and $4,000 during the fiscal years ended August 31,
2008.
There
were no grants of stock options or stock appreciation rights made during the
fiscal years ended August 31, 2009 and 2008 to our executive officers and
directors. There were no stock options outstanding as at August 31,
2009. To date, we have not granted stock options or stock
appreciation rights to any of our employees, consultants, directors or executive
officers.
We intend
to continue to pay consulting fees to our directors and officers in the future
as we determine necessary. In addition, we intend to compensate our directors in
the future with stock options to purchase common shares as awarded by our board
of directors or (as to future stock options) a compensation committee which may
be established. Directors are entitled to reimbursement for
reasonable travel and other out-of-pocket expenses incurred in connection with
attendance at meetings of our board of directors. Our board of directors may
also award special remuneration to any director undertaking any special services
on our behalf other than services ordinarily required of a
director. No director received and/or accrued any compensation for
their services as a director, including committee participation and/or special
assignments.
There are
no formal management agreements with our directors or executive
officers.
We have
no plans or arrangements in respect of remuneration received or that may be
received by our executive officers to compensate such officers in the event of
termination of employment (as a result of resignation, retirement, change of
control) or a change of responsibilities following a change of control, where
the value of such compensation exceeds $60,000 per executive
officer.
There are
no arrangements or plans in which we provide pension, retirement or similar
benefits for directors or executive officers. We have no material
bonus or profit sharing plans pursuant to which cash or non-cash compensation is
or may be paid to our directors or executive officers, except that stock options
may be granted at the discretion of the Board of Directors or a committee
thereof.
|
Item
12.
|
Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters.
|
Beneficial
Ownership
The
following table sets forth, as of December 15, 2009, certain information with
respect to the beneficial ownership of our common shares by each shareholder
known to us to be the beneficial owner of 5% of our common shares, and by each
of our officers and directors. Each person has sole voting and
investment power with respect to the common shares, except as otherwise
indicated. Beneficial ownership consists of a direct interest in the
common shares, except as otherwise indicated.
|
Name
and Address of
Beneficial
Owner
|
Amount
and Nature of
Beneficial
Ownership
|
Percentage
of
Class(1)
|
|
Vanessa
Avila
|
18,000,000
common shares
|
71%
|
|
Directors
and Officers
(as
a group)
|
18,000,000
common shares
|
71%
|
(1) Based
on 25,185,450 shares outstanding as of December 15, 2009 and, as to a
specific person, shares issuable pursuant to the conversion or exercise, as the
case may be, of currently exercisable or convertible debentures, share purchase
warrants and stock options.
16
Changes
in Control
We are
unaware of any contract or other arrangement the operation of which may at a
subsequent date result in a change in control of our company.
Item
13. Certain Relationships and Related Transactions.
None.
Item
14. Principal Accountant Fees and Services
Audit
Fees
The
aggregate fees billed by LBB & Associates Ltd., LLP for professional
services rendered for the audit of our annual financial statements included in
our Annual Report on Form 10-K for the fiscal year ended August 31, 2009 were
$5,500.
Audit
Related Fees
For the
fiscal year ended August 31, 2009, the aggregate fees billed for assurance and
related services by LBB & Associates Ltd., LLP relating to the performance
of the audit of our financial statements which are not reported under the
caption "Audit Fees" above, was $5,625.
Tax
Fees
For the
fiscal year ended August 31, 2009, the aggregate fees billed by LBB &
Associates Ltd., LLP for other non-audit professional services, other than those
services listed above, totalled $0.
We do not
use LBB & Associates Ltd., LLP for financial information system design and
implementation. These services, which include designing or
implementing a system that aggregates source data underlying the financial
statements or generates information that is significant to our financial
statements, are provided internally or by other service providers. We
do not engage LBB &
Associates Ltd., LLP to provide compliance outsourcing
services.
Effective
May 6, 2003, the Securities and Exchange Commission adopted rules that require
that before LBB & Associates Ltd., LLP is engaged by us to render any
auditing or permitted non-audit related service, the engagement be:
|
·
|
approved
by our audit committee (which consists of entire Board of Directors);
or
|
|
·
|
entered
into pursuant to pre-approval policies and procedures established by the
audit committee, provided the policies and procedures are detailed as to
the particular service, the audit committee is informed of each service,
and such policies and procedures do not include delegation of the audit
committee's responsibilities to
management.
|
17
The audit
committee pre-approves all services provided by our independent
auditors. The pre-approval process has just been implemented in
response to the new rules, and therefore, the audit committee does not have
records of what percentage of the above fees were
pre-approved. However, all of the above services and fees were
reviewed and approved by the audit committee either before or after the
respective services were rendered.
The audit
committee has considered the nature and amount of fees billed by LBB &
Associates Ltd., LLP and believes that the provision of services for activities
unrelated to the audit is compatible with maintaining LBB & Associates Ltd.,
LLP's independence.
Item
15. Exhibits.
Exhibits
required by Item 601 of Regulation S-B
|
(3)
|
Articles
of Incorporation and By-laws
|
|
3.1
|
Articles
of Incorporation (incorporated by reference from our Registration
Statement on Form SB-2, filed on February 4, 2003).
|
|
3.2
|
Bylaws
(incorporated by reference from our Registration Statement on Form SB-2,
filed on February 4, 2003).
|
|
(31)
|
Section
302 Certification
|
|
31.1
|
Certification
of Vanessa Avila
|
|
31.2
|
Certification
of Eduardo
|
|
(32)
|
Section
906 Certification
|
|
32.1
|
Certification
of Vanessa Avila
|
|
32.2
|
Certification
of Eduardo Avila
|
18
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
TORTUGA
MEXICAN IMPORTS, INC.
By: /s / Vanessa
Avila
Vanessa
Avila, President, Secretary and Director
Date:
December 15, 2009
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
By: /s/ Vanessa
Avila
Vanessa
Avila, President, Secretary and Director (Principal Executive
Officer)
Date:
December 15, 2009
By: /s/ Eduardo
Avila
Eduardo
Avila, Treasurer and Director (Principal Financial Officer
and
Principal Accounting Officer)
Date:
December 15, 2009
19