Attached files
file | filename |
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EX-3.2 - Gemini Tea Corp. | ex3-2.htm |
EX-3.1 - Gemini Tea Corp. | ex3-1.htm |
EX-4.1 - Gemini Tea Corp. | ex4-1.htm |
EX-23.1 - Gemini Tea Corp. | ex23-1.htm |
U. S.
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
S-1
REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
As filed
with the Securities and Exchange
Commission
on______________
Registration
No. ______________
Gemini Tea
Corp.
(Exact
name of registrant as specified in its charter)
Nevada
|
2099
|
____________
|
(State
or other jurisdiction
of
incorporation or organization)
|
(Primary
Standard Industrial
Classification
Code Number)
|
(I.R.S.
Employer Identification No.)
|
13836
Parkland Blvd SE, Calgary, Alberta Canada
|
(Address
of registrant's principal executive
offices)
|
T2J 3X4
(Zip Code)
(403) 256-2066 | ||||
(Registrant's Telephone Number, Including Area Code) |
Corporate
Creations Network Inc.
8275
South Eastern Avenue
Suite
200-47
Las
Vegas. Nevada 89123
Tel:
(800) 672-9110
(Name,
Address and Telephone Number of Agent for Service)
Approximate
date of proposed sale to the public: From time to time after this registration
statement becomes effective.
If any of
the securities being registered on this form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, check
the following box. [ ]
If this
Form is filed to register additional securities for an offering pursuant to Rule
462(b) under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same
offering. [ ]
If this
Form is a post-effective amendment filed pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. [ ]
If this
Form is a post-effective amendment filed pursuant to Rule 462(d) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. [ ]
If the
delivery of the prospectus is expected to be made pursuant to Rule 434, check
the following box. £
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definitions of “large accelerated filer,”
“accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act. (Check one)
Accelerated
filer o
|
|
Small
reporting company T
|
CALCULATION
OF REGISTRATION FEE
Title
of each class
of
securities
to
be registered
|
Amount
to
be
registered
|
Proposed
maximum
offering
price
per
share
|
Proposed
maximum
aggregate
offering
price
|
Amount
of
registration
fee
|
Common
Stock, $.0001 par value
|
2,000,000
(1)
|
$0.10
|
$200,000
|
$14.26
|
(1) Represents shares offered
for sale by Gemini Tea Corp.
The
registrant hereby amends this registration statement on such date or dates as
may be necessary to delay its effective date until the registrant shall file a
further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933, as amended, or until this registration statement shall
become effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.
Preliminary
Prospectus
Gemini
Tea Corp., a Nevada corporation
2,000,000
Shares of Common Stock
We are
offering for sale 2,000,000 shares of our common stock in a direct public
offering. The purchase price is $0.10 per share. No underwriter is involved in
the offering and distribution of the shares. We are offering the shares without
any underwriting discounts or commissions. Our president, Wanda Canning, will
offer and sell the shares on our behalf. If all of the shares offered
are purchased, the proceeds to us will be $200,000. There is no minimum amount
required to be raised in this offering. Subscriptions for shares of our common
stock are irrevocable once made and funds will only be returned upon rejection
of the subscription. This is our initial public offering and no public market
currently exists for shares of our common stock. This offering will terminate
six months following the effective date of this registration statement and will
not be extended.
Title
of securities
to
be offered
|
Number
of offered shares
|
Offering
price
per
share
|
Proceeds
|
Common
Stock
|
2,000,000
|
$0.10
|
$200,000
|
This
offering involves a high degree of risk. See “Risk Factors” on Pages
5 to 8 for factors to be considered before purchasing shares of our common
stock.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the adequacy or
accuracy of this prospectus. Any representation to the contrary is a criminal
offense.
The
information in this prospectus is not complete and may be changed. We will not
sell these securities until the registration statement filed with the Securities
and Exchange Commission is effective. This prospectus is not an offer to sell
these securities and it is not soliciting an offer to buy these securities in
any state or other jurisdiction where the offer or sale of these securities is
not permitted.
The date
of this prospectus is April 12, 2010.
TABLE OF
CONTENTS
Prospectus
Summary
|
6
|
|
Risk
Factors
|
8
|
|
Forward
Looking Statements
|
11
|
|
Use
of Proceeds
|
11
|
|
Determination
of Offering Price
|
12
|
|
Dilution
|
12
|
|
Selling
Security Holders
|
13
|
|
Plan
of Distribution
|
13
|
|
Legal
Proceedings
|
14
|
|
Directors,
Executive Officers, Promoters and Control Persons
|
14
|
|
Security
Ownership of Certain Beneficial Owners and Management
|
15
|
|
Description
of Securities
|
15
|
|
Interest
of Named Experts and Counsel
|
16
|
|
Disclosure
of Commission Position on Indemnification for Securities Act
Liabilities
|
16
|
|
Organization
Within Last Five Years
|
16
|
|
Description
of Business
|
16
|
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
18
|
|
Description
of Property
|
19
|
|
Certain
Relationships and Related Transactions
|
19
|
|
Market
for Common Equity and Related Stockholder Matters
|
20
|
|
Executive
Compensation
|
21
|
|
Financial
Statements
|
23
|
|
Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure
|
32
|
|
Legal
Matters
|
32
|
|
Experts
|
32
|
|
Additional
Information
|
32
|
|
Indemnification
of Directors and Officers
|
33
|
|
Other
Expenses of Issuance and Distribution
|
33
|
|
Recent
Sales of Unregistered Securities
|
33
|
|
Exhibits
|
34
|
|
Undertakings
|
35
|
|
Signatures
|
37
|
Outside
Back Cover Page
Dealer
Prospectus Delivery Obligation
Until
_______, all dealers that effect transactions in these securities, whether or
not participating in this offering, may be required to deliver a prospectus.
This is in addition to the dealers’ obligations to deliver a prospectus when
acting as underwriters and with respect to their unsold allotments or
subscriptions.
Prospectus
Summary
Our
Business:
|
We
were incorporated in Nevada on February 2, 2010. Our principal business
address is 13836 Parkland Blvd SE, Calgary, Alberta, Canada, T2J 3X4. Our
telephone number is (403) 256-2066.
We
are a retailer/wholesaler of herbal, green, black and white teas and tea
related accessories. We believe that we will need to raise a total of
$100,000 to pay the costs of this offering and conduct our proposed
business activities.
|
|
Summary
financial information:
|
The
summary financial information set forth below is derived from the more
detailed financial statements appearing elsewhere in this Form S-1. We
have prepared our financial statements contained in this Form S-1 in
accordance with accounting principles generally accepted in the United
States. All information should be considered in conjunction with our
financial statements and the notes contained elsewhere in this Form
S-1.
|
Income
Statement
|
For
the One
Month
Ended
February,
2010
$
|
For
the year
ended
February
28, 2010
$
|
For
the Period
from
February 2,
2010
(inception)
to
February
28, 2010
$
|
|||||||||
Revenue
|
0 | 0 | 0 | |||||||||
Total
Operating Expenses
|
515 | 515 | 515 | |||||||||
Net
Income (Loss)
|
(515 | ) | (515 | ) | (515 | ) | ||||||
Net
Income (Loss) Per Share
|
(0.00 | ) | (0.00 | ) | (0.00 | ) |
Balance
Sheet
|
February
28, 2010
$
|
February
28, 2010
$
|
February
28, 2010
$
|
|||||||||
Total
Assets
|
400 | 400 | 400 | |||||||||
Total
Liabilities
|
515 | 515 | 515 | |||||||||
Stockholders'
Equity
|
(115 | ) | (115 | ) | (115 | ) |
6
Number
of shares being offered:
|
We
are offering for sale 2,000,000 shares of our common stock. We will sell
the shares we are registering only to those individuals who have received
a copy of the prospectus.
|
|
Number
of shares outstanding after the offering:
|
4,000,000
shares of our common stock are currently issued and outstanding. After the
offering, there may be up to 6,000,000 shares of our common stock issued
and outstanding if all of the offered shares are sold.
|
|
Estimated
use of proceeds:
|
We
will receive $200,000 if all of the offered shares are sold and $100,000
if half the offered shares are sold. If all of the offered shares are
purchased, we intend to use the proceeds for rent/office expenses,
computer equipment, website development expenses, marketing expenses,
working capital and offering expenses. This is a best efforts offering
with no minimum offering amount. There is no guarantee that we will
even raise enough funds to cover the expenses of this
offering.
|
|
7
RISK
FACTORS
In
addition to the other information in this prospectus, the following risk factors
should be considered carefully in evaluating our business before purchasing any
of our shares of common stock. A purchase of our common stock is speculative in
nature and involves a lot of risks. No purchase of our common stock should be
made by any person who is not in a position to lose the entire amount of his
investment.
Risks related to our
business:
We
may not be able to further implement our business strategy unless sufficient
funds are raised in this offering. If we do not raise at least
$100,000 we may have to cease operations, which could cause investors to lose
their investment in us.
In order
to fund our operations, we believe that we need minimum proceeds of
approximately $100,000 from this offering. We believe that $150,000 will be
sufficient to pay for the expenses of this offering and conduct our proposed
business activities. Moreover, we hope to raise $200,000 which would allow us to
implement our business plan to the full extent that we envision. We
may not realize sufficient proceeds to complete further business development
costs, or to provide adequate cash flow for planned business activities. Our
inability to raise sufficient funds in this offering may significantly hinder
our ability to continue operations. If we fail to raise sufficient funds in this
offering, investors may lose their entire cash investment.
We
have a limited operating history upon which an evaluation of our prospects can
be made.
We were
incorporated on February 2, 2010. Our lack of operating history makes an
evaluation of our business and prospects very difficult. Our prospects must be
considered speculative, considering the risks, expenses, and difficulties
frequently encountered in the establishment of a new business. We cannot be
certain that our business will be successful or that we will generate
significant revenues.
We are a
development stage company that is currently developing our business. To date, we
have not generated any revenues. The success of our business operations will
depend upon our ability to obtain clients and provides quality services to those
clients. We are not able to predict whether we will be able to develop our
business and generate significant revenues. If we are not able to complete the
successful development of our business plan, generate significant revenues and
attain sustainable operations, then our business will fail.
We
may not be able to compete effectively with other providers that have more
resources and experience than we have.
Our
industry is significantly competitive. We have competitors that provide some or
all of the services and products that we expect provide and who are larger and
have more resources than we do. Many of our competitors have significantly
greater financial, human and marketing resources than we have. As a result, such
competitors may be able to respond more quickly to new trends and changes in
customer demands. Such competitors may also be able to devote greater resources
to the development, promotion, sale, and support of their services and products
than we do. If we do not compete effectively with current and future
competitors, we may be unable to secure new customers or we may be required to
reduce our prices in order to complete effectively. This could result in a
reduction in our revenues, resulting in lower earnings or operating
losses.
We
anticipate that we may need to raise additional capital to market our products
and services. Our failure to raise additional capital will significantly affect
our ability to fund our proposed marketing activities.
We are
currently not engaged in any sophisticated marketing program to market our
services because we lack sufficient capital and revenues to justify the
expenditure. We need to raise at least $100,000 to pay for the costs of this
offering and fund our proposed business activities. We believe that we will need
to raise $150,000 in this offering to fully implement our business plans.
However, we may need to spend more funds on marketing and promotion than we have
initially estimated. Therefore, if we need additional funds, we will need to
raise additional capital in addition to the funds raised in this offering. We do
not know if we will be able to acquire additional financing at commercially
reasonable rates. Our failure to obtain additional funds would significantly
limit or eliminate our ability to fund our sales and marketing
activities.
8
We
may not have sufficient financial resources to fund our operations if the
offering is substantially undersold.
There is
no minimum offering amount for this offering. We may not sell any or all of the
offered shares. If the offering is substantially undersold, investors may lose
their entire investment because we will not have sufficient capital to fund our
operations. If we do not sell all of the offered shares, we may also be forced
to limit any proposed business activities, which will hinder our ability to
generate revenues.
Investors
in this offering will suffer immediate and substantial dilution of their
investment because they will provide 99.80% of the capital for a 33.33% equity
interest in the company.
The
initial public offering price is substantially higher than the pro forma net
tangible book value per share of our outstanding common stock. Our existing
shareholder has paid considerably less than the amount to be paid for the common
stock in this offering. As a result, assuming an initial public offering price
of $0.10 per share, investors purchasing common stock in this offering will
incur immediate dilution of $0.068 in pro forma net tangible book value per
share of common stock as of February 28, 2010 if all of the offered shares are
sold.
We
may not realize sufficient proceeds from this offering to implement our business
plan as we are offering shares on direct participation basis, rather then using
the experience of a dealer-broker.
We are
offering shares on a direct participation basis. No individual, firm, or
corporation has agreed to purchase any of the offered shares. We cannot guaranty
that any or all of the shares will be sold. We do not plan to use a
dealer-broker, even though a dealer-broker may have more experience, resources
or contacts to more effectively achieve the sale of shares. A delay in the sale
of the shares in this offering can be expected to cause a similar delay in the
implementation of our business plan.
Our
officer/director is engaged in other activities that could conflict with our
interests. Therefore, our officer/director may not devote sufficient time to our
affairs, which may affect our ability to conduct marketing and business
activities and generate revenues.
The
individual serving as our officer/director has existing
responsibilities and may have additional business responsibilities unrelated to
us. As a result, conflicts of interest between us and our officer/director’s
other activities may occur from time to time, in that our officer/director may have conflicts of
interest in allocating time, services, and functions between the other business
ventures in which she may be or become involved and our affairs.
We
depend on the efforts and abilities of our management to continue
operations.
Our
management is our only employee with experience relevant to business. Outside
demands on our management’s time may prevent her from devoting sufficient time
to our operations. In addition, the demands on their time will increase because
of our status as a public company. The interruption of the services of our
management could significantly hinder our operations, profits and future
development, if suitable replacements are not promptly obtained. We
do not currently have any executive compensation agreements. We
cannot guaranty that our management will remain with us.
Our auditors have expressed
substantial doubt regarding our ability to continue operations as a “going
concern.” Investors may lose all of their investment if we are unable to
continue operations and generate revenues, or if we do not raise sufficient
funds in this offering.
We have
not generated any revenues from our operations. In the absence of
significant sales and profits, we will seek to raise additional funds to meet
our working capital needs principally through the additional sales of our
securities. However, we cannot guaranty that we will be able to
obtain sufficient additional funds when needed, such as the funds we are
attempting to raise in this offering, or that such funds, if available, will be
obtainable on terms satisfactory to us. If we do not raise sufficient
funds in this offering, we may not be able to continue in
business. As a result, our auditors believe that substantial doubt
exists about our ability to continue operations.
The
costs to meet our reporting requirements as a public company subject to the
Exchange Act of ’34 will be substantial and may result in us having insufficient
funds to operate our business.
We will
incur ongoing expenses associated with professional fees for accounting and
legal expenses associated with being a public company. We estimate that these
costs will range up to $35,000 per year for the next few years. Those fees will
be higher if our business volume and activity increases. Those obligations
will reduce and possibly eliminate our ability and resources to fund our
operations and may prevent us from meeting our normal business
obligations.
9
Risks related to owning our
common stock:
We
arbitrarily determined the offering price of the shares of common stock.
Therefore, investors may lose all or part of their investment if the offering
price is higher than the current market value of the offered
shares.
The
offering price of the shares of common stock being offered by us has been
determined primarily by our capital requirements and has no relationship to any
established criteria of value, such as book value or earnings per share.
Additionally, because we have no significant operating history and have only
generated minimal revenues to date, the price of the shares of common stock is
not based on past earnings, nor is the price of the shares indicative of current
market value for the assets owned by us. Investors could lose all or a part of
their investment if the offering price has been arbitrarily set too high. Even
if a public trading market develops for our common stock, the shares may not
attain market values commensurate with the offering price.
Our
officer, director and principal shareholder controls our operations and matters
requiring shareholder approval.
Our
officer, director and principal shareholder currently own 100% of our
outstanding shares of common stock. Even if all the offered shares are sold, she
will still own 66.67% of our outstanding shares of common stock. As a
result, our officer, director and principal shareholder will have the ability to
control or significantly influence all matters requiring approval by our
shareholders, including the election and removal of directors. Such control will
allow our officer, director and principal shareholder to control the future
course of the company. Our officer, director and principal shareholder does not
intend to purchase any of the shares in this offering.
Investors
should not look to dividends as a source of income.
In the
interest of reinvesting initial profits back into our business, we do not intend
to pay cash dividends in the foreseeable future. Consequently, any
economic return will initially be derived, if any at all, from appreciation in
the fair market value of our stock and not as a result of dividend
payments.
Because
we may be subject to the “penny stock” rules, the level of trading activity in
our stock may be reduced which may make it difficult for investors to sell their
shares.
Broker-dealer
practices in connection with transactions in “penny stocks” are regulated by
certain penny stock rules adopted by the Securities and Exchange Commission.
Penny stocks, like shares of our common stock, generally are equity securities
with a price of less than $5.00, other than securities registered on certain
national securities exchanges or quoted on NASDAQ. The penny stock rules require
a broker-dealer, prior to a transaction in a penny stock not otherwise exempt
from the rules, to deliver a standardized risk disclosure document that provides
information about penny stocks and the nature and level of risks in the penny
stock market. The broker-dealer also must provide the customer with current bid
and offer quotations for the penny stock, the compensation of the broker-dealer
and its salesperson in the transaction, and, if the broker-dealer is the sole
market maker, the broker-dealer must disclose this fact and the broker-dealer’s
presumed control over the market, and monthly account statements showing the
market value of each penny stock held in the customer’s account. In addition,
broker-dealers who sell these securities to persons other than established
customers and “accredited investors” must make a special written determination
that the penny stock is a suitable investment for the purchaser and receive the
purchaser’s written agreement to the transaction. Consequently, these
requirements may have the effect of reducing the level of trading activity, if
any, in the secondary market for a security subject to the penny stock rules,
and investors in our common stock may find it difficult to sell their
shares.
We
lack a public market for shares of our common stock, which may make it difficult
for investors to sell their shares.
There is
no public market for shares of our common stock. We cannot guaranty that an
active public market will develop or be sustained. Therefore, investors may not
be able to find purchasers for their shares of our common stock.
Should there develop a significant market for our shares, the market price for
those shares may be significantly affected by such factors as our financial
results and introduction of new products and services. Factors such
as announcements of new services by us or our competitors and quarter-to-quarter
variations in our results of operations, as well as market conditions in our
sector may have a significant impact on the market price of our shares. Further,
the stock market has experienced extreme volatility that has particularly
affected the market prices of the stock of many companies and such volatility
may be unrelated or disproportionate to the operating performance of those
companies.
10
Forward Looking
Statements
Information
in this prospectus contains “forward looking statements” which can be identified
by the use of forward-looking words such as “believes”, “estimates”, “could”,
“possibly”, “probably”, “anticipates”, “estimates”, “projects”, “expects”,
“may”, “will”, or “should” or other variations or similar words. No
assurances can be given that the future results anticipated by the
forward-looking statements will be achieved. The following matters
constitute cautionary statements identifying important factors with respect to
those forward-looking statements, including certain risks and uncertainties that
could cause actual results to vary materially from the future results
anticipated by those forward-looking statements. Among the key
factors that have a direct bearing on our results of operations are the costs
and effectiveness of our operating strategy. Other factors could also
cause actual results to vary materially from the future results anticipated by
those forward-looking statements.
Use of
Proceeds
We will
receive up to $200,000 if all of the shares of common stock offered by us at
$0.10 per share are purchased. We cannot guarantee that we will sell any or all
of the shares being offered by us. This is a best efforts offering with no
minimum offering amount. The table below estimates our use of proceeds, given
the varying levels of success of the offering. We expect that the proceeds
will be used to reimburse expenses that were incurred on behalf of the company
by our president prior to the offering.
Offered
Shares Sold
|
Offering
Proceeds
|
Approximate
Offering
Expenses(1)
|
Total
Net Offering
Proceeds
|
Principal
Uses of Net Proceeds
|
||
500,000
shares (25%)
|
$50,000
|
$11,000
|
$39,000
|
Computer
Equipment: $3,000
Website
Development: $7,000
Marketing/Printing: $11,500
Working
Capital: $19,500
|
||
1,200,000
shares (60%)
|
$120,000
|
$11,000
|
$109,000
|
Computer
Equipment: $5,500
Website
Development: $12,000
Marketing/Printing: $42,000
Working
Capital: $51,500
|
||
2,000,000
shares (maximum)
|
$200,000
|
$11,000
|
$189,000
|
Computer
Equipment: $10,000
WebsiteDevelopment: $12,000
Marketing/Printing: $65,000
Working
Capital: $105,000
|
(1) Offering
expenses have been rounded to $11,000.
Working
capital will be used to pay general administrative expenses, legal expenses and
accounting expenses for the next twelve months. Those expenses may increase if
we are able to grow our operations and marketing
activities. Marketing expenses primarily include costs associated
with travel and entertainment expenses to attend trade shows, conferences and
meet potential wholesale customers for our products and services. Marketing
expenses also includes development, preparation and printing of marketing
materials, such as brochures and catalogs. The funds from this offering will not
be used to pay Ms. Wanda Canning, our president, for any services related to
activities undertaken to further the success of this offering, whether provided
prior to, during, or subsequent to the offering.
We expect
that the proceeds will be used to reimburse expenses that were incurred on
behalf of the company by our president prior to the offering. If the
offering proceeds are insufficient to pay the offering expenses in full, then it
is intended that Ms. Canning will pay those expenses.
11
Determination of Offering
Price
Factors Used to Determine Share
Price. The offering price of the 2,000,000 shares of common
stock being offered by us has been determined primarily by our capital
requirements and has no relationship to any established criteria of value, such
as book value or earnings per share. Additionally, because we have no
significant operating history and have only generated limited revenues to date,
the price of the shares of common stock is not based on past earnings, nor is
the price of the shares indicative of current market value for the assets owned
by us. No valuation or appraisal has been prepared for our business and
potential business expansion.
Dilution
We intend
to sell 2,000,000 shares of our common stock. We were initially capitalized by
the sale of our common stock. The following table sets forth the number of
shares of common stock purchased from us, the total consideration paid and the
price per share. The table assumes all 2,000,000 shares of common stock will be
sold. The founding shareholder is Wanda Canning.
Shares
Issued
|
Total
Consideration
|
Price
Per
Share
|
|||
Number
|
Percent
|
Amount
|
Percent
|
||
Founding
Shareholder(1)
|
4,000,000
Shares
|
66.67%
|
$400
|
0.20%
|
$0.0001
|
Purchasers
of Shares
|
2,000,000
Shares
|
33.33%
|
$200,000
|
99.80%
|
$0.10
|
Total
|
6,000,000
Shares
|
100%
|
$200,400
|
100%
|
(1)
|
The
founding shareholder was issued 4,000,000 shares of our common stock in
exchange for consideration of $400 or $0.0001 per
share.
|
The
following table sets forth the difference between the offering price of the
shares of our common stock being offered by us, the net tangible book value per
share, and the net tangible book value per share after giving effect to the
offering by us, assuming that 100% and 50% of the offered shares are sold. Net
tangible book value per share represents the amount of total tangible assets
less total liabilities divided by the number of shares outstanding as of
February 28, 2010. Totals may vary due to rounding.
100%
of offered
shares
are sold
|
50% of
offered
shares
are sold
|
|
Offering
Price
|
$0.10
per
share
|
$0.10
per
share
|
Net
tangible book value at 02/28/10
|
$0.00003
per
share
|
$0.00003
per
share
|
Net
tangible book value after giving effect to the offering
|
$0.032
per
share
|
$0.018
per
share
|
Increase
in net tangible book value per share attributable to cash payments made by
new investors
|
$0.03197
per
share
|
$0.01797
per
share
|
Per
Share Dilution to New Investors
|
$0.068
per
share
|
$0.082
per
share
|
Percent
Dilution to New Investors
|
68%
|
82%
|
12
Selling Security
Holder
There are
no selling security holders in this offering.
Plan of
Distribution
Primary Offering. We are
offering for sale 2,000,000 shares of our common stock in a direct public
offering on a best efforts basis with no minimum. There is no minimum
amount that must be sold, and we will receive any proceeds from this offering
immediately upon the acceptance of subscription agreements we
receive. We will accept or reject any subscription agreement within
ten days of receipt, and any checks submitted with rejected subscription
agreements will be returned promptly.
We have
not conducted any discussions or negotiations for the sale of all or any portion
of those 2,000,000 shares of our common stock. There is no minimum number of
shares that must be purchased by each prospective purchaser and the maximum
number of shares we will sell is 2,000,000. We will not pay any commissions or
other fees, directly or indirectly to any person or firm in connection with
solicitation of sales of the common stock. We will not conduct any
aspect of this offering online, nor is any such online offering
contemplated. This offering will terminate six months following the
effective date of this registration statement.
Our
officer/director does not have any agreement or plan to purchase any shares in
this offering. There will not be any affiliates or associates of Ms.
Canning purchasing shares in this offering.
Ms.
Canning, our president, will not participate in the offer and sale of our shares
of common stock, and will rely on the safe harbor from broker-dealer
registration set out in Rule 3a4-1 under the Securities Exchange Act of
1934. Although Ms. Canning is an associated person of the company as
that term is defined in Rule 3a4-l under the Exchange Act, she believes she will
not be deemed to be a broker for the following reasons:
·
|
Ms.
Canning is not subject to a statutory disqualification as that term is
defined in Section 3(a)(39) of the Exchange Act at the time of his
participation in the sale of our securities.
|
·
|
Ms.
Canning will not be compensated for her participation in the sale of
company securities by the payment of commission or other remuneration
based either directly or indirectly on transactions in
securities.
|
·
|
Ms.
Canning is not an associated person of a broker or dealer at the time of
participation in the sale of company securities.
|
Ms.
Canning will restrict her participation to the following
activities:
·
|
preparing
any written communication or delivering any communication through the
mails or other means that does not involve oral solicitation by the
president of a potential purchaser;
|
·
|
responding
to inquiries of potential purchasers in communication initiated by the
potential purchasers, provided, however, that the content of responses are
limited to information contained in a registration statement filed under
the Securities Act or other offering
document;
|
·
|
performing
ministerial and clerical work involved in effecting any
transaction.
|
13
We have
not retained a broker for the sale of securities being offered. In the event we
retain a broker who may be deemed an underwriter, an amendment to the
registration statement will be filed.
The
shares of common stock being offered by us have not been registered for sale
under the securities laws of any state as of the date of this
prospectus.
Under the
Securities Exchange Act of 1934 and the regulations thereunder, any person
engaged in a distribution of the shares of our common stock offered by this
prospectus may not simultaneously engage in market making activities with
respect to our common stock during the applicable “cooling off” periods prior to
the commencement of such distribution.
Legal
Proceedings
There are
no legal actions pending against us nor are any legal actions contemplated by us
at this time.
Directors, Executive
Officers, Promoters and Control Persons
Executive Officers and
Directors. Our directors and principal executive officers are as
specified on the following table:
Name
|
Age
|
Position
|
Wanda
Canning
|
46
|
President,
Chief Financial Officer, Secretary, Treasurer and
Director
|
Wanda Canning. Ms. Canning has
been our President, Chief Financial Officer, Secretary, Treasurer and our sole
director since the date of inception.
From 2005
to the present, Ms. Canning has been the owner/operator of Cassell Business
Services, which provides comprehensive services for small corporations including
matters related to incorporation, bookkeeping, accounting, personal and
corporate taxes. From 2004 to 2005, Ms. Canning owned and operated CasBro, a
retail store specializing in the provision of handmade candle holders and
related accessories. From 1984 to 2003, Ms. Canning provided personal and
corporate tax related services for and on behalf of several accounting firms.
Ms. Canning is not an officer or director of any other reporting
company.
All
directors hold office until the completion of their term of office, which is not
longer than one year, or until their successors have been elected. All officers
are appointed annually by the board of directors and, subject to any employment
agreements (which do not currently exist) serve at the discretion of the board.
Currently, directors receive no compensation.
There are
no orders, judgments, or decrees of any governmental agency or administrator, or
of any court of competent jurisdiction, revoking or suspending for cause any
license, permit or other authority to engage in the securities business or in
the sale of a particular security or temporarily or permanently restraining any
of our officers or directors from engaging in or continuing any conduct,
practice or employment in connection with the purchase or sale of securities, or
convicting such person of any felony or misdemeanor involving a security, or any
aspect of the securities business or of theft or of any felony. Nor are any of
the officers or directors of any corporation or entity affiliated with us so
enjoined.
14
Security Ownership of
Certain Beneficial Owners and Management
The
following table sets forth certain information regarding the beneficial
ownership of our common stock as of April 12, 2010, by each person or entity
known by us to be the beneficial owner of more than 5% of the outstanding shares
of common stock, each of our directors and named executive officers, and all of
our directors and executive officers as a group.
Title
of Class
|
Name
and Address of Beneficial Owner
|
Amount
and Nature of Beneficial Owner
|
Percent
of Class if No Shares are Sold
|
Percent
of Class if 1,000,000 Shares are Sold
|
Percent
of Class if 2,000,000 Shares are Sold
|
Common
Stock
|
Wanda
Canning 13836 Parkland Blvd SE, Calgary, Alberta Canada T2J
3X4
|
4,000,000
shares President, Director
|
100.00%
|
80.00%
|
66.67%
|
Common
Stock
|
All
directors and named executive officers as a group
|
4,000,000
shares
|
100.00%
|
80.00%
|
66.67%
|
Beneficial
ownership is determined in accordance with the rules of the Securities and
Exchange Commission and generally includes voting or investment power with
respect to securities. In accordance with Securities and Exchange
Commission rules, shares of our common stock which may be acquired upon exercise
of stock options or warrants which are currently exercisable or which become
exercisable within 60 days of the date of the table are deemed beneficially
owned by the optionees. Subject to community property laws, where applicable,
the persons or entities named in the table above have sole voting and investment
power with respect to all shares of our common stock indicated as beneficially
owned by them.
Changes in
Control. Our management is not aware
of any arrangements that may result in a change in control.
Committees. Our Board of
Directors does not currently have a compensation committee or nominating and
corporate governance committee because, due to the Board of Director’s
composition and our relatively limited operations, the Board of Directors
believes it is able to effectively manage the issues normally considered by such
committees. Our Board of Directors may undertake a review of the need for these
committees in the future.
Audit Committee and Financial Expert.
Presently, the Board of Directors acts as the audit committee. The Board
of Directors does not have an audit committee financial expert. The Board of
Directors has not yet recruited an audit committee financial expert to join the
board of directors because we have only recently commenced a significant level
of financial operations.
Code of Ethics. We do not
currently have a Code
of
Ethics that applies to all employees,
including our principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions. We plan to adopt a Code of Ethics.
Description of
Securities
We were
authorized to issue 100,000,000 shares of $.0001 par value common
stock. As of April 12, 2010, 4,000,000 shares of our common stock
were issued and outstanding.
Each
shareholder of our common stock is entitled to a pro rata share of cash
distributions made to shareholders, including dividend payments. The
holders of our common stock are entitled to one vote for each share of record on
all matters to be voted on by shareholders. There is no cumulative voting with
respect to the election of our directors or any other matter. Therefore, the
holders of more than 50% of the shares voted for the election of those directors
can elect all of the directors. In the event of our liquidation, dissolution or
winding up, the holders of common stock are entitled to share ratably in all
assets remaining available for distribution to them after payment of our
liabilities and after provision has been made for each class of stock, if any,
having any preference in relation to our common stock. Holders of shares of our
common stock have no conversion, preemptive or other subscription rights, and
there are no redemption provisions applicable to our common stock.
Dividend Policy. We have never
declared or paid a cash dividend on our capital stock. We do not expect to pay
cash dividends on our common stock in the foreseeable future. We currently
intend to retain our earnings, if any, for use in our business. Any dividends
declared in the future will be at the discretion of our board of
directors.
Our
Articles of Incorporation and our Bylaws do not contain any provisions that were
included to delay, defer, discourage or prevent a change in
control.
15
Interest of Named Experts
and Counsel
No
“expert” or our “counsel” was hired on a contingent basis, or will receive a
direct or indirect interest in us, or was a promoter, underwriter, voting
trustee, director, officer, or employee of the company, at any time prior to the
filing of this registration statement.
Disclosure of Commission
Position on Indemnification for Securities Act
Liabilities
Article
VIII of our Bylaws provides that our officers and directors shall be indemnified
and held harmless by us to the fullest extent permitted by the provisions of
Section 78.7502 of the Nevada Revised Statutes.
Accordingly,
our directors may have no liability to our shareholders for any mistakes or
errors of judgment or for any act of omission, unless as provided under the
Nevada Revised Statutes, the act or omission involves intentional misconduct,
fraud, or a knowing violation of law or results in unlawful distributions to our
shareholders as provided.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to our directors, officers and controlling persons pursuant to the
foregoing provisions, or otherwise, we have been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in that act and is, therefore, unenforceable.
Organization Within Last
Five Years
Transactions with Promoters.
Wanda Canning is our promoter and serves as our sole officer and
director. In February, 2010, we issued 4,000,000 shares of our common stock to
Wanda Canning who is our founder and was our sole officer and director at
inception. These shares were issued in exchange for cash payment of $400.00 or
$0.0001 per share.
Description of
Business
Our Background. We were
incorporated in Nevada on February 2, 2010.
Our Business. We are a
retailer/wholesaler of herbal, green, black and white teas and tea related
accessories.
Our Supplier. As of the date
of this prospectus, we have not secured one or more suppliers of tea leaves and
herbs. We intend to establish direct relations with tea suppliers and suppliers
of tea related accessories. We may develop relationships with more than one
supplier so that we will have complementary suppliers in the event that our
current supplier is unable to meet our customer requirements and so that we may
diversify our product offerings.
Our Target Markets and Marketing
Strategy. Our target markets are the United States and Canada. We
intend to establish a warehouse in Calgary, Alberta, Canada that will store our
inventory. From this warehouse, products will be shipped to destinations in the
United States and Canada. We intend to aggressively market and promote the
Gemini Tea brand through the Internet including social networking websites, to
grocery stores, restaurants, health food stores, spas and cafes throughout the
United States and Canada. We also plan to attend trade conventions, industry
events and place promotional pieces in various print and Internet based
publications.
Growth Strategy. We plan to
drive growth through implementation of our marketing strategy that, in turn, we
anticipate will lead to increased sales of our products. We hope that increased
sales will lead to customer satisfaction with our products and, consequently,
word of mouth promotion by new customers.
Our Website. Our
website www.geminiteas.com is
under construction. We expect that our website will provide information on all
products that we sell, allow users to purchase products directly on our website,
and serve as one of our primary marketing tools to create brand awareness. As
well, our website will provide a description of our business and our contact
information including address, telephone number and email address.
Our Competition. The tea
industry is significantly competitive. We have competitors that have been
providing teas and tea accessories for many years through traditional storefront
operations and through Internet based operations and these competitors have more
resources then we do. Many of these competitors have significantly greater
financial, human and marketing resources than we have. As a result, these
competitors may be able to devote greater resources to the development,
promotion, sale and support of their products than we do. If we do not compete
effectively with current and future competitors, we may be not be able to secure
customers and/or we may be required to reduce our prices in order to compete
effectively. This could result in a reduction in our revenues, resulting in
lower earnings or operating losses.
Many of
our competitors have substantially greater financial, technical, managerial,
marketing and other resources than we do and they may compete more effectively
than us. We anticipate that competition will increase in the future. We may not
successfully compete in any market in which we conduct or may conduct
operations.
We
believe that our products will be unique in terms of flavor and herb and tea
leaf combinations. We anticipate spending sufficient time and energy researching
and testing our products. We believe that this will provide us with a
competitive advantage as compared to our competitors. In addition, our ability
to compete effectively will be
dependent
on our management establishing an effective marketing plan that secures adequate
numbers of retail and wholesale customers.
16
Government Regulation. Through
the laws and regulations of Canada and the provincial government of Alberta, our
products and services are subject to material regulation by responsible
governmental agencies. As such, business and company registrations and business
operations must be in compliance with the laws and regulations of provincial and
other local governments and industry agencies. We believe that we are in
conformity with all applicable laws of Alberta.
We are
also subject to federal, state and local laws and regulations generally applied
to businesses, such as payroll taxes on the state and federal levels. We believe
that we are in conformity with all applicable laws in Nevada and the United
States.
Our Research and Development.
As of the date of this prospectus, we have not conducted any research and
development. To finalize our products and subsequently maintain a competitive
advantage in the marketplace, we believe that we will need to engage in research
and development.
Intellectual Property. We do
not presently own any copyrights, patents, trademarks, licenses, concessions or
royalties, and we may rely on certain proprietary technologies, trade secrets,
and know-how that are not patentable.
We own
the Internet domain name “www.geminiteas.com”
Under current domain name registration practices, no one else can obtain an
identical domain name, but someone might obtain a similar name, or the identical
name with a different suffix, such as “.org”, or with a country designation. The
regulation of domain names in the United States and in foreign countries is
subject to change and we could be unable to prevent third parties from acquiring
domain names that infringe or otherwise decrease the value of our domain
names.
Employees. As of the date of
this prospectus, we have no salaried employees.
Facilities. Our executive,
administrative and operating offices are located at 13836 Parkland Blvd SE,
Calgary, Alberta, T2J 3X4, Canada. Wanda Canning, our President, Chief Executive
Officer, Secretary, Treasurer and Director provides our office space at no
charge.
17
Management's Discussion and
Analysis of Financial Condition and Results of
Operations
Critical
Accounting Policy and Estimates. Our Management’s Discussion and Analysis of
Financial Condition and Results of Operations section discusses our financial
statements, which have been prepared in accordance with accounting principles
generally accepted in the United States of America. The preparation of these
financial statements requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during
the reporting period. On an on-going basis, management evaluates its estimates
and judgments, including those related to revenue recognition, accrued expenses,
financing operations, and contingencies and litigation. Management bases its
estimates and judgments on historical experience and on various other factors
that are believed to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying value of assets and
liabilities that are not readily apparent from other sources. Actual results may
differ from these estimates under different assumptions or conditions. The most
significant accounting estimates inherent in the preparation of our financial
statements include estimates as to the appropriate carrying value of certain
assets and liabilities which are not readily apparent from other sources. In
addition, these accounting policies are described at relevant sections in this
discussion and analysis and in the notes to the financial statements included in
this Registration Statement on Form S-1.
The
following discussion of our financial condition and results of operations should
be read in conjunction with our audited financial statements for the year ended
February 28, 2010, and the period from February 2, 2010 (inception) to February
28, 2010, together with notes thereto which are included in this Registration
Statement on Form S-1.
For the one month ended February
28, 2010.
Results
of Operations.
Revenues. We had no revenues
for the one month ended February 28, 2010. We hope to generate
revenues as we commence operations and implement our business
plan.
Operating Expenses. For the
one month ended February 28, 2010, our total operating expenses were
$515. Expenses are primarily due to incorporation
expenses.
Net Loss. For the
one month ended February 28, 2010, our net loss was $515. The net loss was
due to incorporation expenses.
Liquidity and Capital
Resources. On February 2, 2010, we issued 4,000,000 shares of common
stock to our founder in exchange for cash payment of $400 or $0.0001 per
share. We intend to use these proceeds to pay for administrative
expenses.
As of
February 28, 2010, we had liabilities of $515 which represented a related party
loan from our sole officer/director. We had no other long term liabilities,
commitments or contingencies.
During
2010, we expect to incur significant accounting costs associated with the audit
of our financial statements. We expect that the legal and accounting costs of
becoming a public company will continue to impact our liquidity and we may need
to obtain funds to pay those expenses. Other than the anticipated increases in
legal and accounting costs due to the reporting requirements of becoming a
reporting company, we are not aware of any other known trends, events or
uncertainties, which may affect our future liquidity.
For the year ended February 28,
2010.
Results
of Operations.
Revenues. We had no revenues
for the one month ended February 28, 2010, as compared to no revenues generated
during the period from February 2, 2010 (inception) to February 28,
2010. We hope to generate revenues as we commence operations and
implement our business plan.
Operating Expenses. For the
year ended February 28, 2010, our total operating expenses were $515. These fees
resulted from incorporation expenses.
Net Loss. For the
year ended February 28, 2010, our net loss was $515. The net loss was a result
of incorporation expenses.
Liquidity and Capital
Resources. On February 2, 2010, we issued 4,000,000 shares of common
stock to our founder in exchange for cash payment of $400 or $0.0001 per
share.
As of
February 28, 2010, we had liabilities of $515 which represented a related party
loan from our sole officer/director. We had no other long term liabilities,
commitments or contingencies.
During
2010, we expect to incur significant accounting costs associated with the audit
of our financial statements. We expect that the legal and accounting costs of
becoming a public company will continue to impact our liquidity and we may need
to obtain funds to pay those expenses. Other than the anticipated increases in
legal and accounting costs due to the reporting requirements of becoming a
reporting company, we are not aware of any other known trends, events or
uncertainties, which may affect our future liquidity.
Our Plan of Operation for the Next
Twelve Months. To implement our business plan during the next
twelve months, we must raise at least $100,000 in this offering and begin to
market and promote our services. With the proceeds from this offering, we intend
to purchase computer equipment, complete development of our website, conduct
market research and begin marketing our products to potential clients. We are
developing sales and marketing materials including brochures describing the
products that we provide so that we may promote a professional appearance to
potential customers.
During
the next three to six months, our primary objective is to complete the offering
and begin to obtain customers so that we generate revenues to support our
operations. During the next six to twelve months, we hope to expand our
operations and provide products and service to several customers. We believe
that the size of our operations may vary depending on the amount of funds raised
in this offering. If we are able to sell all of the shares in this offering, we
believe that the size of our operations will increase because we will be able to
increase our marketing activities. If we do not raise any funds in this
offering, we may not have adequate funds to market our services. We
need to raise at
least $100,000 to pay for the costs of this offering and fund our proposed
business activities. We believe that we will need to raise $150,000 in this
offering to fully implement our business plans. However, we may need to spend
more funds on marketing and promotion than we have initially estimated. Our
failure to market and promote our services will hinder our ability to increase
the size of our operations and generate additional revenues. If we are not able
to generate additional revenues that cover our estimated operating costs, then
our business may fail.
18
We have
cash and cash equivalents of $400 as of February 28, 2010. In the opinion of
management, available funds will not satisfy our working capital requirements to
operate at our current level of activity for the next twelve months. Those
funds do not include any funds raised in this offering. We will not be able to
implement our business plan in the manner that we envision unless we raise funds
from this offering. Our forecast for the period for which our financial
resources will be adequate to support our operations involves risks and
uncertainties. Actual results may differ significantly from our forecast and our
business may fail as a result of several factors. In order to expand our
operations, we do not currently anticipate that we will need to raise additional
capital in addition to the funds raised in this offering. If we do
not raise at least $100,000 from this offering, then we may not be able to pay
for the expenses of this offering, fund our operations, complete development of
our website, conduct marketing activities and expand our
operations. This offering is a best efforts offering with no
minimum. We will have access to these funds as soon as they are
received.
We are
not currently conducting any research and development activities other than the
development of our website, which we expect the total cost to be approximately
$12,000. We do not anticipate conducting such activities in the near
future. In the event that we expand our customer base, then we may need to hire
additional employees or independent contractors as well as purchase or lease
additional equipment. Our management believes that we do not require the
services of independent contractors to operate at our current level of
activity. However, if our level of operations increases beyond the level
that our current staff can provide, then we may need to supplement our staff in
this manner.
Off-Balance Sheet
Arrangements. We have no off-balance sheet
arrangements.
Description of
Property
Property
held by us. As of February 28, 2010, we held no real property. We do
not presently own any interests in real estate.
Our Facilities. Our executive,
administrative and operating offices are located at 13836 Parkland Blvd SE,
Calgary, Alberta, T2J 3X4. Wanda Canning, our President, Chief Executive
Officer, Secretary, Treasurer and Director provides our office space at no
charge. We do not have a written lease or sublease agreement with Ms. Canning.
Ms. Canning does not expect to be paid or reimbursed for providing office
facilities. We believe that our facilities are adequate for our needs
and that additional suitable space will be available on acceptable terms as
required. We do not own any real estate.
Certain Relationships and
Related Transactions
Certain Relationships.
None.
Related party
transactions.
In
February, 2010, we issued 4,000,000 shares of our common stock to Wanda Canning,
our President, Chief Financial Officer, Secretary, Treasurer and Director and
who held such offices and directorship on the date of inception. These shares
were issued in exchange for cash payment of $400.00 or $0.0001 per
share.
Wanda
Canning, our President, Chief Executive Officer, Secretary, Treasurer and
Director provides our office space at no charge.
We
believe that each report transaction and relationship is on terms that are at
least as fair to us as would be expected if those transactions were negotiated
with third parties.
There
have been no other related party transactions, or any other transactions or
relationships required to be disclosed pursuant to Item 404 of Regulation
S-K.
With
regard to any future related party transaction, we plan to fully disclose any
and all related party transactions, including, but not limited to, the
following:
·
|
disclose
such transactions in prospectuses where
required;
|
·
|
disclose
in any and all filings with the Securities and Exchange Commission, where
required;
|
·
|
obtain
disinterested directors’ consent;
and
|
·
|
obtain
shareholder consent where required.
|
19
Market for Common Equity and
Related Stockholder Matters
Reports to Security Holders.
Our securities are not listed for trading on any exchange or quotation service.
We are not required to comply with the timely disclosure policies of any
exchange or quotation service. The requirements to which we would be subject if
our securities were so listed typically include the timely disclosure of a
material change or fact with respect to our affairs and the making of required
filings. Although we are not required to deliver an annual report to security
holders, we intend to provide an annual report to our security holders, which
will include audited financial statements.
When we
become a reporting company with the Securities and Exchange Commission, the
public may read and copy any materials filed with the Securities and Exchange
Commission at the Security and Exchange Commission’s Public Reference Room at
100 F Street, N.E., Washington, D.C. 20549. The public may also obtain
information on the operation of the Public Reference Room by calling the
Securities and Exchange Commission at 1-800-SEC-0330. The Securities
and Exchange Commission maintains an Internet site that contains reports, proxy
and information statements, and other information regarding issuers that file
electronically with the Securities and Exchange Commission. The address of that
site is http://www.sec.gov.
As of
April 12, 2010, there was one record holder of our common stock.
There are
no outstanding shares of our common stock that may be sold pursuant to Rule 144.
There are no outstanding options or warrants to purchase, or securities
convertible into, shares of our common stock. There are no outstanding shares of
our common stock that we have agreed to register under the Securities Act of
1933 for sale by security holders.
There
have been no cash dividends declared on our common stock. Dividends
are declared at the sole discretion of our Board of Directors.
Recent Sales of Unregistered
Securities. There have been no sales of unregistered securities within
the last three (3) years that would be required to be disclosed pursuant to Item
701 of Regulation S-K, except for the following:
On
February 2, 2010, we issued 4,000,000 shares of common stock to our founder in
exchange for cash payment of $400.00 or $0.0001 per share. The shares were
issued in a transaction that we believe satisfies the requirements of that
exemption from the registration and prospectus delivery requirements of the
Securities Act of 1933, which exemption is specified by the provisions of
Section 5 of that act and Regulation S promulgated pursuant to that act by the
Securities and Exchange Commission.
Purchases of Equity
Securities. None.
No Equity Compensation Plan.
We do not have any securities authorized for issuance under any equity
compensation plan. We also do not have an equity compensation plan
and do not plan to implement such a plan.
Penny Stock
Regulation. Shares of our common stock will probably be
subject to rules adopted by the Securities and Exchange Commission that regulate
broker-dealer practices in connection with transactions in “penny
stocks”. Penny stocks are generally equity securities with a price of
less than $5.00, except for securities registered on certain national securities
exchanges or quoted on the NASDAQ system, provided that current price and volume
information with respect to transactions in those securities is provided by the
exchange or system. The penny stock rules require that a broker-dealer,
prior to a transaction in a penny stock not otherwise exempt from those rules,
deliver a standardized risk disclosure document prepared by the Securities and
Exchange Commission, which contains the following:
·
|
a
description of the nature and level of risk in the market for penny stocks
in both public offerings and secondary
trading;
|
·
|
a
description of the broker’s or dealer’s duties to the customer and of the
rights and remedies available to the customer with respect to violation to
such duties or other requirements of securities’
laws;
|
·
|
a
brief, clear, narrative description of a dealer market, including “bid”
and “ask” prices for penny stocks and the significance of the spread
between the “bid” and “ask” price;
|
·
|
a
toll-free telephone number for inquiries on disciplinary
actions;
|
·
|
definitions
of significant terms in the disclosure document or in the conduct
of trading in penny stocks;
and
|
20
·
|
such
other information and is in such form, including language, type, size and
format, as the Securities and Exchange Commission shall require by rule or
regulation.
|
Prior to
effecting any transaction in penny stock, the broker-dealer also must provide
the customer the following:
·
|
the
bid and offer quotations for the penny
stock;
|
·
|
the
compensation of the broker-dealer and its salesperson in the
transaction;
|
·
|
the
number of shares to which such bid and ask prices apply, or other
comparable information relating to the depth and liquidity of the market
for such stock; and
|
·
|
monthly
account statements showing the market value of each penny stock held in
the customer’s account.
|
In
addition, the penny stock rules require that prior to a transaction in a penny
stock not otherwise exempt from those rules, the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser’s written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitably
statement. These disclosure requirements may have the effect of reducing
the trading activity in the secondary market for a stock that becomes subject to
the penny stock rules. Holders of shares of our common stock may have
difficulty selling those shares because our common stock will probably be
subject to the penny stock rules.
Executive
Compensation
Any
compensation received by our officers, directors, and management personnel will
be determined from time to time by our board of directors. Our officers,
directors, and management personnel will be reimbursed for any out-of-pocket
expenses incurred on our behalf.
Summary Compensation
Table. The table set forth below summarizes the annual and
long-term compensation for services in all capacities to us payable to our chief
executive officer and our other executive officers for the year ended February
28, 2010 and the period from February 2, 2010 (inception) to February 28,
2010. Our board of directors may adopt an incentive stock option plan
for our executive officers that would result in additional
compensation.
Annual
Compensation
|
Long
Term Compensation
|
|||||||
Name
and Principal
Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Other
Annual Compensation ($)
|
Awards
|
Payouts
|
All
Other Compensation
|
|
Restricted
Stock Awards ($)
|
Securities
Underlying Options/SARs (#)
|
LTIP
Payouts ($)
|
||||||
Wanda
Canning
President,
Chief Financial Officer, Secretary, Treasurer
|
2010
|
None
|
None
|
None
|
None
|
None
|
None
|
None
|
Employment Contracts and Termination
of Employment. We do not anticipate that we will enter into any
employment contracts with any of our employees. 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 or retirement).
Stock Options/SAR Grants. No
grants of stock options or stock appreciation rights were made since our date of
incorporation on February 2, 2010.
21
Outstanding Equity Awards at Fiscal
Year-End. As of the year ended February 28, 2010, the following named
executive officer had the following unexercised options, stock that has not
vested, and equity incentive plan awards:
Option Awards
|
Stock
Awards
|
||||||||
Name
|
Number of Securities Underlying
Unexercised Options #
Exercisable
|
#
Un-exercisable
|
Equity
Incentive Plan Awards, Number of Securities Underlying Unexercised
Options
|
Option
Exercise Price
|
Option
Expiration Date
|
Number
of Shares or Units of Stock Not Vested
|
Market
Value of Shares or Units Not Vested
|
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights
Not Vested
|
Value
of Unearned Shares, Units or Other Rights Not Vested
|
Wanda
Canning
President,
Chief Financial Officer, Secretary, Treasurer
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Long-Term Incentive
Plans. There are no arrangements or plans in which we provide pension,
retirement or similar benefits for directors or executive officers. We do not
have any 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.
As of February 28, 2010, we had no group life, health, hospitalization, or
medical reimbursement or relocation plans in effect.
Compensation of Directors. Our
directors who are also our employees receive no extra compensation for their
service on our board of directors.
22
Financial
Statements
GEMINI
TEA CORP.
(A
DEVELOPMENT STAGE COMPANY)
INDEX
TO FINANCIAL STATEMENTS
Report
of Independent Registered Public Accounting Firm
|
25
|
||
Balance
Sheet as of February 28, 2010 (Audited)
|
26
|
||
Statement
of Expenses For the Period from February 2, 2010 (Inception) through
February 28, 2010
|
27
|
||
Statement
of Stockholders’ Deficit For the Period from February 2, 2010 (Inception)
through February 28, 2010
|
28
|
||
Statement
of Cash Flows For the Period from February 2, 2010 (Inception) through
February 28, 2010
|
29
|
||
Notes
to Financial Statements
|
30
|
23
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the
Board of Directors and Stockholders,
Gemini
Tea Corp.
(a
Development Stage Company)
Calgary,
Alberta, Canada
We have
audited the accompanying consolidated balance sheet of Gemini Tea Corp as of
February 28, 2010 and the related consolidated statements of operations,
shareholders’ equity, and cash flows for the period from inception (February 2,
2010) through February 28, 2010. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our
audit.
We
conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform an audit 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 audit 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 audit provides a
reasonable basis for our opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Gemini Tea Corp. as of February 28,
2010 and the results of operations and cash flows for the period then ended, in
conformity with accounting principles generally accepted in the United States of
America.
MaloneBailey,
LLP
www.malonebailey.com
Houston,
Texas
March 5,
2010
24
GEMINI
TEA CORP.
(A
Development Stage Company)
Balance
Sheet
February
28, 2010
ASSETS
|
||||
CURRENT
ASSETS
|
||||
Cash
|
$ | 400 | ||
Total
Current Assets
|
400 | |||
TOTAL
ASSETS
|
$ | 400 | ||
LIABILITIES AND STOCKHOLDERS’
DEFICIT
|
||||
CURRENT
LIABILITIES
|
||||
Related
party loan payable
|
$ | 515 | ||
Total
Current Liabilities
|
515 | |||
Total
Liabilities
|
515 | |||
STOCKHOLDERS’
DEFICIT
|
||||
Common
stock, $0.0001 par value, authorized 100,000,000
|
||||
shares;
4,000,000 shares issued and outstanding
|
400 | |||
Deficit
accumulated during the development stage
|
(515 | ) | ||
Total
Stockholders’ Deficit
|
(115 | ) | ||
|
||||
TOTAL
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
$ | 400 |
The
accompanying notes are an integral part of these financial
statements.
25
GEMINI
TEA CORP.
(A
Development Stage Company)
Statement
of Expenses
For
the Period from February 2, 2010 (Inception)
through
February 28, 2010
REVENUES
|
$ | - | ||
OPERATING
EXPENSES
|
||||
General
and administrative
|
515 | |||
OPERATING
LOSS
|
(515 | ) | ||
NET
LOSS
|
$ | (515 | ) | |
BASIC
AND FULLY DILUTED (LOSS) PER SHARE
|
$ | (0.00 | ) | |
WEIGHTED
AVERAGE NUMBER OF SHARES
|
||||
OUTSTANDING
|
4,000,000 |
The
accompanying notes are an integral part of these financial
statements.
26
GEMINI
TEA CORP.
(A
Development Stage Company)
Statement
of Stockholders’ Deficit
For
the Period from February 2, 2010 (Inception)
through
February 28, 2010
Common Stock
|
Deficit
Accumulated During the Development
|
|||||||||||||||
Shares
|
Amount
|
Stage
|
Totals
|
|||||||||||||
Common
stock
|
||||||||||||||||
issued
for cash at $.0001
|
||||||||||||||||
on
Feb 2, 2010
|
4,000,000 | $ | 400 | - | $ | 400 | ||||||||||
Net
loss for the
|
||||||||||||||||
period
ended
|
||||||||||||||||
Feb
28, 2010
|
- | - | (515 | ) | (515 | ) | ||||||||||
Balance,
|
||||||||||||||||
Feb
28, 2010
|
4,000,000 | $ | 400 | $ | (515 | ) | $ | (115 | ) |
The
accompanying notes are an integral part of these financial
statements.
27
GEMINI
TEA CORP.
(A
Development Stage Company)
Statement
of Cash Flows
For
the Period from February 2, 2010 (Inception)
through
February 28, 2010
CASH
FLOWS FROM OPERATING ACTIVITIES
|
||||
Net
loss
|
$ | (515 | ) | |
Adjustments
to reconcile net loss to net cash
|
||||
used
in operating activities:
|
||||
Changes
in operating assets and liabilities:
|
- | |||
Net
Cash (Used in) Operating Activities
|
(515 | ) | ||
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||
Net
Cash Used by Investing Activities
|
- | |||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||
Proceeds
from issuance of common stock
|
400 | |||
Proceeds
from related party loan
|
515 | |||
Net
Cash Provided by Financing Activities
|
915 | |||
NET
INCREASE (DECREASE) IN CASH
|
400 | |||
CASH
AT BEGINNING OF YEAR
|
- | |||
CASH
AT END OF YEAR
|
$ | 400 | ||
NON-CASH
INVESTING AND FINANCING ACTIVITIES:
|
||||
Cash
Paid For:
|
||||
Interest
|
$ | - | ||
Income
taxes
|
$ | - |
The
accompanying notes are an integral part of these financial
statements.
28
GEMINI
TEA CORP.
(A
Development Stage Company)
Notes
to the Financial Statements
February
28, 2010
1. SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
The
Company was incorporated in Nevada on February 2, 2010.
The
Company is in the development stage and has elected February 28 as its fiscal
year end.
Earnings (Loss) Per
Share
Basic net
income (loss) per share amounts are computed based on the weighted average
number of shares actually outstanding. Diluted net income (loss) per share
amounts are computed using the weighted average number of common shares and
common equivalent shares outstanding as if shares had been issued on the
exercise of any common share rights unless the exercise becomes antidilutive and
then only the basic per share amounts are shown in the report.
Estimates and
Assumptions
Management
uses estimates and assumptions in preparing financial statements in accordance
with generally accepted accounting principles. Those estimates and assumptions
affect the reported amounts of the assets and liabilities, the disclosure of
contingent assets and liabilities, and the reported revenues and expenses.
Actual results could vary from the estimates that were assumed in preparing
these financial statements.
Statement of Cash
Flows
For the
purposes of the statement of cash flows, the Company considers all highly liquid
investments with maturity of three months or less to be cash
equivalents.
Cash and cash
equivalents
Cash
equivalents are highly liquid investments with an original maturity of three
months or less.
Revenue
Recognition
Revenue
is recognized on the sale and delivery of a product or the completion of a
service provided. The Company did not have any revenue during 2010 fiscal
year.
Income
Taxes
The
Company utilizes the liability method of accounting for income taxes. Under the
liability method deferred tax assets and liabilities are determined based on the
differences between financial reporting and the tax bases of the assets and
liabilities and are measured using the enacted tax rates and laws that will be
in effect, when the differences are expected to reverse. An allowance against
deferred tax assets is recorded when it is more likely than not that such
benefits will not be realized.
29
GEMINI
TEA CORP.
(A
Development Stage Company)
Notes
to the Financial Statements
February
28, 2010
1. SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Income Taxes
(Continued)
Deferred
taxes are provided on a liability method whereby deferred tax assets are
recognized for deductible temporary differences and operating loss and tax
credit carryforwards and deferred tax liabilities are recognized for taxable
temporary differences. Temporary differences are the differences between the
reported amounts of assets and liabilities and their tax bases. Deferred tax
assets are reduced by a valuation allowance when, in the opinion of management,
it is more likely than not that some
portion
or all of the deferred tax assets will not be realized. Deferred tax assets and
liabilities are adjusted for the effects of changes in tax laws and rates on the
date of enactment.
Net
deferred tax assets consist of the following components as of February 28,
2010:
Deferred
tax assets:
|
||||
NOL
Carryover
|
$ | 515 | ||
Valuation
Allowance
|
(515 | ) | ||
Net
deferred tax asset
|
$ | - |
Foreign Currency
Translation
The
Company is based in Calgary, Alberta although it is incorporated in Nevada.
Since inception, all transactions have been in U.S. dollars, although that may
change when operating activities commence. There are no hedging contracts.
Revenues and expenses during each period will be translated at the average
exchange rates of those periods. Equity accounts are translated at historical
amounts. Translation adjustments are deferred in the equity account, Other
Comprehensive Income (Loss) is a separate component of Stockholders’
Equity.
Recent Accounting
Pronouncements
The
Company does not expect that the adoption of other recent accounting
pronouncements will have a material impact on its financial
statements.
2. GOING
CONCERN
As set
forth on the Company’s balance sheet, its assets total $400. These funds
represent an amount paid by the Company’s officer/director for their common
shares. This amount does not provide adequate working capital for the Company to
successfully operate its’ business and to service its debt. Expenses incurred to
the date of this prospectus are being recorded on the Company’s books as they
occur. This raises substantial doubt about its ability to continue as a going
concern. Continuation of the Company as a going concern is dependent upon
obtaining additional working capital. Management believes that the Company will
be able to operate for the coming year by obtaining additional loans from Ms.
Canning and from equity funding, via proceeds raised from the offering set forth
in this prospectus. However there can be no assurances that management’s plans
will be successful.
30
GEMINI
TEA CORP.
(A
Development Stage Company)
Notes
to the Financial Statements
February
28, 2010
3. SIGNIFICANT
TRANSACTIONS WITH RELATED PARTIES
On
February 2, 2010, the sole officer-director acquired all of the Company’s
outstanding capital stock, being 4,000,000 common shares, at a price of $0.0001
per share. The officer-director made a demand loan to the Company of
$515.
The
Company neither owns nor leases any real or personal property, and 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.
31
Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure
In 2010,
our Board of Directors appointed Malone & Bailey, PC, to audit our financial
statements from February 2, 2010, our date of formation, through February 28,
2010. There have been no disagreements with our accountant since our
formation.
Experts
Our
financial statements for year ended February 28, 2010 appearing in this
prospectus which is part of a Registration Statement have been audited by Malone
& Bailey, PC and are included in reliance upon such report given upon the
authority of Malone & Bailey, PC as experts in accounting and
auditing.
Additional
Information
We have
filed a registration statement on Form S-1 with the Securities and Exchange
Commission pursuant to the Securities Act of 1933. This prospectus
does not contain all of the information set forth in the registration statement
and the exhibits and schedules to the registration statement. For further
information regarding us and our common stock offered hereby, reference is made
to the registration statement and the exhibits and schedules filed as a part of
the registration statement.
32
PART
II - INFORMATION NOT REQUIRED IN PROSPECTUS
Indemnification
of Directors and Officers
Article
VIII of our Bylaws provides that our officers and directors shall be indemnified
and held harmless by us to the fullest extent permitted by the provisions of
Section 78.7502 of the Nevada Revised Statutes.
Accordingly,
our directors may have no liability to our shareholders for any mistakes or
errors of judgment or for any act of omission, unless as provided under the
Nevada Revised Statutes, the act or omission involves intentional misconduct,
fraud, or a knowing violation of law or results in unlawful distributions to our
shareholders as provided.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to our directors, officers and controlling persons pursuant to the
foregoing provisions, or otherwise, we have been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable.
Other
Expenses of Issuance and Distribution
We will
pay all expenses in connection with the registration and sale of our common
stock. The estimated expenses of issuance and distribution are set forth
below.
Registration
Fees
|
Approximately
|
$14.26
|
||
Costs
of Printing
|
Approximately
|
$1,300.00
|
||
Legal
Fees
|
Approximately
|
$5,500.00
|
||
Accounting
Fees
|
Approximately
|
$4,200.00
|
Recent Sales of Unregistered
Securities
There
have been no sales of unregistered securities within the last three years that
would be required to be disclosed pursuant to Item 701 of Regulation S-K, except
for the following:
On
February 2, 2010, we issued 4,000,000 shares of our common stock to our founder
in exchange for cash payment of $400.00 or $0.0001 per share.
The
shares were issued in a transaction that we believe satisfies the requirements
of that exemption from the registration and prospectus delivery requirements of
the Securities Act of 1933, which exemption is specified by the provisions of
Section 5 of that act and Regulation S promulgated pursuant to that act by the
Securities and Exchange Commission. There were no commissions paid on the sale
of these shares. The investors are non-U.S. persons and the sales were made in
an offshore transaction. No directed selling efforts were made in the United
States by us or any person acting on our behalf. The offer or sale was not made
to a U.S. person or for the account or benefit of a U.S. person. The purchaser
of the securities certified that it was not a U.S. person and was not acquiring
the securities for the account or benefit of any U.S. person. The purchasers of
the securities have agreed to resell such securities only in accordance with the
provisions of Regulation S or pursuant to registration under the Securities Act
of 1933. The shares of common stock issued to the purchaser contain a legend to
the effect that transfer is prohibited except in accordance with the provisions
of this Regulation S or pursuant to registration under the Securities Act of
1933. We will not register any transfer of the securities unless such transfer
is made in accordance with the provisions of Regulation S or pursuant to
registration under the Securities Act of 1933.
33
Exhibits
Copies of
the following documents are filed with this registration statement, Form S-1, as
exhibits:
Exhibit
No.
1
|
Underwriting
Agreement (not applicable)
|
3.1
|
Articles
of Incorporation
|
3.2
|
Bylaws
|
4.1
|
Subscription
Agreement
|
8
|
Opinion
Re: Tax Matters (not applicable)
|
11
|
Statement
Re: Computation of Per Share Earnings*
|
15
|
Letter
on unaudited interim financial information (not
applicable)
|
23.1
|
Consent
of Auditors
|
*
|
Included
in Financial Statements
|
34
Undertakings
A. We
hereby undertake:
(1)
|
To
file, during any period in which offers or sales are being made, a
post-effective amendment to this registration
statement:
|
(i) To
include any prospectus required by Section 10(a)(3) of the Securities Act of
1933;
(ii)
|
Reflect
in the prospectus any facts or events which, individually or together,
represent a fundamental change in the information in the registration
statement; and Notwithstanding the forgoing, any increase or decrease in
volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation From
the low or high end of the estimated maximum offering range may be
reflected in the form of prospects filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in the volume and price
represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective registration statement;
and
|
(iii)
|
Include
any additional or changed material information on the plan of
distribution.
|
(2)
|
(3)
|
(4)
|
For
determining liability of the undersigned small business issuer under the
Securities Act to any purchaser in the initial distribution of the
securities, the undersigned small business issuer undertakes that in a
primary offering of securities of the undersigned small business issuer
pursuant to this registration statement, regardless of the underwriting
method used to sell the securities to the purchaser, if the securities are
offered or sold to such purchaser by means of any of the following
communications, the undersigned small business issuer will be a seller to
the purchaser and will be considered to offer or sell such securities to
such purchaser:
|
B.
|
(1)
|
Insofar
as indemnification for liabilities arising under the Securities Act of
1933 (the "Act") may be permitted to directors, officers and controlling
persons of the small business issuer pursuant to the foregoing provisions,
or otherwise, the small business issuer has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable.
|
35
(2)
|
In
the event that a claim for indemnification against such liabilities (other
than the payment by the small business issuer of expenses incurred or paid
by a director, officer or controlling person of the small business issuer
in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the
securities being registered, the small business issuer will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as expressed
in the Securities Act and will be governed by the final adjudication of
such issue.
|
C.
|
Each
prospectus filed pursuant to Rule 424(b) as part of a registration
statement relating to an offering, other than registration statements
relying on Rule 430B or other than prospectuses filed in reliance on Rule
430A, shall be deemed to be part of and included in the registration
statement as of the date it is first used after effectiveness. Provided,
however, that no statement made in a registration statement or prospectus
that is part of the registration statement or made in a document
incorporated or deemed incorporated by reference into the registration
statement or prospectus that is part of the registration statement will,
as to a purchaser with a time of contract of sale prior to such first use,
supersede or modify any statement that was made in the registration
statement or prospectus that was part of the registration statement or
made in any such document immediately prior to such date of first
use.
|
36
SIGNATURES
|
|
Pursuant
to the requirements of the Securities Act, the Registrant has duly caused this
Registration Statement on Form S-1 to be signed on its behalf by the
undersigned, thereunto duly authorized.
Gemini
Tea Corp.,
a Nevada
corporation
/s/
Wanda Canning
|
April
12, 2010
|
|||
Name:
Wanda Canning
|
||||
Title :
President,
(Principal
Executive Officer), Chief Financial Officer (Principal Financial and
Accounting Officer), Secretary, Treasurer, Director
|
In
accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following person in the capacities and
on the dates stated:
/s/
Wanda Canning
|
April
12, 2010
|
|||
Name:
Wanda Canning
|
||||
Title :
President,
(Principal
Executive Officer), Chief Financial Officer (Principal Financial and
Accounting Officer), Secretary, Treasurer, Director
|
37