Edgar Filing: Link Resources Inc.

link10q083109.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x Quarterly Report Pursuant To Section 13 Or 15(D) Of The Securities Exchange Act Of 1934

For the quarterly period ended August 31, 2009

o Transition Report Under Section 13 Or 15(D) Of The Securities Exchange Act Of 1934

For the transition period from ____________ to ____________

COMMISSION FILE NUMBER 333-153102

LINK RESOURCES INC.

(Exact name of registrant as specified in its charter)

NEVADA	98-0588402
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

392 Acadia Drive S.E., Calgary, Alberta, Canada T2J 0A8

(Address of principal executive offices, including zip code)

403-230-0945

(Issuer’s telephone number, including area code)

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 o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “non-accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes x No o

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date. 3,450,000 shares of common stock as of October 15, 2009

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

The following consolidated interim unaudited financial statements of Link Resources Inc. (the “Company”) for the three month period ended August 31, 2009 are included with this Quarterly Report on Form 10-Q:

(a)

Consolidated Balance Sheets as of August 31, 2009 and May 31, 2009;

(b)

Consolidated Statements of Operations for the three months August 31, 2009, for the three months ended August 31, 2008 and for the period from January 9, 2008 (Inception) to August 31, 2009.

(c)

Consolidated Statements of Cash Flows for the three months ended August 31, 2009, for the three months ended August 31, 2008 and for the period from January 9, 2008 (Inception) to August 31, 2009.

(d)

Condensed Notes to Financial Statements.

LINK RESOURCES INC.
(A Development Stage Company)
Balance Sheet
(Unaudited)

ASSETS

	August 31,			May 31,
	2009			2009

CURRENT ASSETS
Cash and Cash Equivalents	$	27,653		$	2,440



TOTAL ASSETS	$	27,653		$	2,440

LIABILITIES & STOCKHOLDERS' EQUITY

CURRENT LIABILITES
Accrued Interest		1,688
Notes Payable	$	400,000		$	-

		401,688

Commitments and contingencies (Note 4)

STOCKHOLDERS' EQUITY
Common Stock, $0.001 par value, 75,000,000 shares authorized, 3,450,000 shares issued and outstanding		3,450			3,450
Additional paid-in capital		50,550			50,550
Deficit accumulated in the development stage		(428,035	)		(51,560	)

Total Stockholders' Equity		(374,035	)		2,440

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	27,653		$	2,440

See accompanying condensed notes to interim financial statements.

LINK RESOURCES INC.
(A Development Stage Company)
Statement of Operations
(Unaudited)

						For the period
						of inception
						from Jan. 9,
	For the Three Months					2008 through
	ended August 31,					August 31,
	2009			2008		2009

Revenues	$	-		$	-	$	-

Costs and Expenses

Mineral Lease		-			4,196		14,196
Consulting		-			1,500		2,921
Professional Fees		354,156			13,156		368,900
Due Diligence Costs		20,000			-		20,000
Stock Transfer Fees		400			-		18,137
Other General & Administrative		231			43		2,193

Total Expenses		374,787			18,895		426,347

Operating Loss		(374,787	)		18,895		(426,347	)

Net Income (Loss)		(374,787	)		18,895		(426,347	)

Other Expense
Interest		(1,688	)		-		(1,688	)

Net Income (Loss)	$	(376,475	)	$	18,895	$	(428,035	)


Basic and Dilutive net loss per share		(0.11	)		0.01

Weighted average number of shares outstanding, basic and diluted		3,450,000			3,450,000

See accompanying condensed notes to interim financial statements.

LINK RESOURCES INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)

							For the period
							of Inception,
	For the three months						from Jan. 9,
	ended						2008 through
	August 31,						August 31,
	2009			2008			2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (Loss)	$	(376,475	)	$	(18,895	)	$	(426,347	)
Change in operating assets and liabilities:
Accrued Interest		1,688			-			-
Net Cash provided by (used by)
Operating Activities		(374,787	)		(18,895	)		(426,347	)

CASH FLOWS FROM INVESTING ACTIVITIES

Net Cash (used by) Investing Activities		-			-			-

CASH FLOWS FROM FINANCING ACTIVITIES					-
Issue of Common stock for cash		-			-			54,000
Proceeds of Note Payable		400,000			-			400,000
		400,000			-			454,000

NET INCREASE IN CASH		25,213			(18,895	)		27,653

CASH AT BEGINNING OF PERIOD		2,440			47,768			-

CASH AT END OF PERIOD	$	27,653		$	28,873		$	27,653


CASH PAID FOR:
Interest	$	-		$	-		$	-
Income Taxes	$	-		$	-		$	-

See accompanying condensed notes to interim financial statements.

Link Resources, Inc.

(A Developmental Stage Company)

Notes to the Financial Statements

August 31, 2009

1.	Basis of Presentation and Nature of Operations

The interim financial statements as of and for the three months ended August 31, 2009 reflect all adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows for the period presented in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.

These interim financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s May 31, 2009 report. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the three month period ended August 31, 2009 are not necessarily indicative of results for the entire year ending May 31, 2010.

Organization

Link Resources, Inc. (the “Company”) was incorporated under the laws of the State of Nevada January 9, 2008. The Company’s principal offices are in Calgary, Alberta, Canada.

Exploration Stage Activities

The company was in the exploration stage since its formation and did not yet realized any revenues from its planned operations. The Company entered into a Mineral Lease Agreement on April 1, 2008 for two mining claims in Pershing County, Nevada, in an area known as the Goldbanks East Prospect. The Company terminated the lease on July 7, 2009.

Merger Activities

The Company engaged in an ongoing search for suitable business opportunities during the first quarter, involving potential merger. Short term bridge loans totaling $400,000 were obtained in June 2009 to defray professional fees and due diligence costs.

2. Summary of Significant Accounting Policies

Basis of Presentation

The financial statements of the Company have been prepared using the accrual basis of accounting in accordance with generally accepted accounting principles in the United States. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from those estimates. Significant estimates made by management are, among others, realizability of long-lived assets, deferred taxes and stock option valuation.

The financial statements have, in management’s opinion, been properly prepared within the reasonable limits of materiality and within the framework of the significant accounting.

Income Taxes

The Company utilizes SFAS No. 109, “Accounting for Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company generated a deferred tax credit through net operating loss carryforward. However, a valuation allowance of 100% has been established, as the realization of the deferred tax credits is not reasonably certain, based on going concern considerations outlined as follows.

Going Concern

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

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish its plans to exploit or lease its mining claim described in the initial paragraph, or engage a working interest partner, in order to eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classifications or liabilities or other adjustments that might be necessary should the Company be unable to continue as a going concern.

Development Stage Company

The Company is considered a development stage company, with limited operating revenues during the periods presented, as defined by Statement of Financial Accounting Standards (“SFAS”) No. 7. SFAS. No. 7 requires companies to report their operations, shareholders deficit and cash flows since inception through the date that revenues are generated from management’s intended operations, among other things. Management has defined

inception as January 9, 2008. Since inception, the Company has incurred an operating loss of $428,035. The Company’s working capital has been generated through the sales of common stock and borrowings. Management has provided financial data since January 9, 2008, “Inception” in the financial statements, as a means to provide readers of the Company’s financial information to make informed investment decisions.

Basic and Diluted Net Loss Per Share

Net loss per share is calculated in accordance with SFAS 128, Earnings Per Share for the period presented. Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilative convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby we used to purchase common stock at the average market price during the period.

The Company has no potentially dilutive securities outstanding as of May 31, 2009.

The following is a reconciliation of the numerator and denominator of the basic and diluted earnings per share computations for the three months ended August 31, 2009 and 2008:

Numerator

Basic and diluted net loss per share:	2009			2008

Net Loss	$	( 376,475	)	$	18,895

Denominator

Basic and diluted weighted average number of shares outstanding		3,450,000			3,450,000

Basic and Diluted Net Loss Per Share	$	(0.11	)	$	0.01

3. Capital Structure

During the period from inception through August 31, 2009, the Company entered into the following equity transactions:

April 30, 2008	Sold 1,950,000 shares of common stock at $.02 per share realizing $39,000.

April 30, 2008	Sold 1,500,000 shares of common stock at $.01 per share realizing $15,000.

As of August 31, 2009, the Company has authorized 75,000,000 of $0.001 par common stock, of which 3,450,000 shares were issued and outstanding.

4.	Notes Payable

In June 2009 the Company issued four promissory notes for an aggregate of $400,000. The funds had been raised previously on the Company’s behalf by counsel in a private placement and held in trust accounts. Funds were expended from the trusts for professional fees and due diligence related to an ongoing search for suitable business opportunities, anticipating merger. In June 2009 the Company assumed responsibility for the fees and due diligence costs.

The promissory notes bear interest at 2% per annum, compounded each July 15 and January 15, and are due and payable June 15, 2010. The notes are mandatorily convertible into common stock upon a change in control at the rate of one common share for each two dollars converted.

5. Commitments

On April 1, 2008 the Company entered into an indefinite lease agreement with the owner of 2 mining claims The Company terminated the lease on July 7, 2009.

6. Contingencies, Litigation

There are no loss contingencies or legal proceedings against the Company with respect to matters arising in the ordinary course of business. Neither the Company nor any of its officers or directors is involved in any other litigation either as plaintiffs or defendants, and have no knowledge or any threatened or pending litigation against them or any of the officers of directors.

Item 2. Management’s Discussion and Analysis of Financial condition and Results of Operations

THE FOLLOWING DISCUSSION OF THE RESULTS OF OUR OPERATIONS AND FINANCIAL CONDITION SHOULD BE READ IN CONJUNCTION WITH OUR FINANCIAL STATEMENTS AND THE NOTES THERETO INCLUDED ELSEWHERE IN THIS REPORT.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This section of this report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of our report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results and predictions. We are an exploration stage company and have not yet generated or realized any revenues.

Background

We were incorporated as Link Resources Inc. under the laws of Nevada on January 9, 2008. We are in the business of mineral exploration. On April 1, 2008, we entered in a Mineral Lease Agreement whereby we leased from Timberwolf Minerals, LTD a total of two (2) unpatented lode mining claims in the State of Nevada which we refer to as the Goldbanks East Prospect. These mineral claims are located in Section 20, Township 30 North, Range 39 East, Mt. Diablo Baseline & Meridian, Pershing County, Nevada, USA, owned by Timberwolf Minerals LTD. We cancelled the Mineral Lease Agreement with Timberwolf Minerals, LTD on July 7, 2009.

We are currently seeking other opportunities with established business entities for the merger of a target business with our company. In certain instances, a target business may wish to become a subsidiary of us or may wish to contribute assets to us rather than merge. We are currently in negotiations with a party to enter into a business opportunity but we have not entered into any definitive agreements to date and there can be no assurance that we will be able to enter into any definitive agreements. We anticipate that any new acquisition or business opportunities by our company will require additional financing. There can be no assurance, however, that we will be able to acquire the financing necessary to enable us to pursue our plan of operation. If our company requires additional financing and we are unable to acquire such funds, our business may fail.

As an exploration stage company, we are not able to fund our cash requirements through our current operations. Historically, we have been able to raise a limited amount of capital through private placements of our equity stock, but we are uncertain about our continued ability to raise funds privately. Further, we believe that our company may have

difficulties raising capital until we locate a prospective property through which we can pursue our plan of operation. If we are unable to secure adequate capital to continue our acquisition efforts, our shareholders may lose some or all of their investment and our business may fail.

Financings

Our operations to date have been funded by equity investment. All of our equity funding has come from a private placement of our securities. We issued 1,500,000 shares of common stock on January 24, 2008 to Anthon Zaradic our president, chief financial officer and director. Mr. Zaradic acquired these shares at a price of $0.01 per share. We received $15,000 from this offering. These shares were issued pursuant to Section 4(2) of the Securities Act of 1933 and are restricted shares as defined in the Securities Act.

We completed an offering of 1,950,000 shares of our common stock at a price of $0.02 per share to a total of thirty (36) purchasers on April 30, 2008. The total amount we received from this offering was $39,000. We completed the offering pursuant to Regulation S of the Securities Act. Each purchaser represented to us that he/she was a non-US person as defined in Regulation S.

In June 2009 we issued four promissory notes for an aggregate of $400,000. The funds had been raised previously on our behalf by counsel in a private placement and held in trust accounts. Funds were expended from the trusts for professional fees and due diligence related to an ongoing search for suitable business opportunities, anticipating merger. In June 2009 we assumed responsibility for the fees and due diligence costs.

The following discussion provides information that management believes is relevant to an assessment and understanding of our operations and the consolidated financial condition and results of operations.

Our Operations

financing necessary to enable us to pursue our plan of operation. If our company requires additional financing and we are unable to acquire such funds, our business may fail.

Management of our company believes that there are perceived benefits to being a reporting company with a class of publicly-traded securities. These are commonly thought to include: (i) the ability to use registered securities to acquire assets or businesses; (ii) increased visibility in the financial community; (iii) the facilitation of borrowing from financial institutions; (iv) improved trading efficiency; (v) stockholder liquidity; (vi) greater ease in subsequently raising capital; (vii) compensation of key employees through stock options; (viii) enhanced corporate image; and (ix) a presence in the United States capital market.

We may seek a business opportunity with entities who have recently commenced operations, or entities who wish to utilize the public marketplace in order to raise additional capital in order to expand business development activities, to develop a new product or service, or for other corporate purposes. We may acquire assets and establish wholly-owned subsidiaries in various businesses or acquire existing businesses as subsidiaries.

In implementing a structure for a particular business acquisition or opportunity, we may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity. We may also acquire stock or assets of an existing business. Upon the consummation of a transaction, it is likely that our present management will no longer be in control of our company. In addition, it is likely that our officer and director will, as part of the terms of the acquisition transaction, resign and be replaced by one or more new officers and directors.

As of the date hereof, management has not entered into any formal written agreements for a business combination or opportunity. When any such agreement is reached, we intend to disclose such an agreement by filing a current report on Form 8-K with the Securities and Exchange Commission.

We anticipate that the selection of a business opportunity in which to participate will be complex and without certainty of success. Management believes that there are numerous firms in various industries seeking the perceived benefits of being a publicly registered corporation. Business opportunities may be available in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex. We can provide no assurance that we will be able to locate compatible business opportunities.

We incurred operating expenses in the amount of $426,347 from inception on January 9, 2008 through the period ended August 31, 2009. These operating expenses were composed of mineral lease payments, exploration expenses, professional fees, and due diligence related to an ongoing search for suitable business opportunities, and other administrative expenses.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

N/A

Item 4. Controls and Procedures.

As of the end of the period covered by this Report, our President, and principal financial officer (the “Certifying Officer”), evaluated the effectiveness of our“disclosure controls and procedures,” as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934. Based on that evaluation, the officer concluded that, as of the date of the evaluation, our disclosure controls and procedures were effective to provide reasonable assurance that the information required to be disclosed in our periodic filings under the Securities Exchange Act of 1934 is accumulated and communicated to management to allow timely decisions regarding required disclosure.

The Certifying Officer has also indicated that there were no significant changes in our internal controls or other factors that could significantly affect such controls subsequent to the date of their evaluation and there were no corrective actions with regard to significant deficiencies and material weaknesses.

Our management, including the Certifying Officer, does not expect that our disclosure controls or our internal controls will prevent all errors and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. In addition, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the control. The design of any systems of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Because of these inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Item 4(t). Controls and Procedures.

The information required pursuant to item 4(t) has been provided in Item 4.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1(a). Risk Factors

There have been no changes to our risk factors from those disclosed in our Registration Statement filed on Form S-1 on August 20, 2008.

Item 2. Unregistered Sales of Equity Securities

In June 2009 we issued four promissory notes for an aggregate of $400,000. The promissory notes bear interest at 2% per annum, compounded each July 15 and January 15, and are due and payable June 15, 2010. The notes are mandatorily convertible into common stock upon a change in control at the rate of one common share for each two dollars converted. In connection with the offer and sale of securities, we relied on the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended.

Item 3. Defaults Upon Senior Securities

None.

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

On May 26, 2009 pursuant to a written consent of a majority of holders of our common stock, our stockholders approved an amendment to our articles of incorporation increasing the authorized number of shares of common stock from 75,000,000 shares to 150,000,000 shares and authorizing the creation of 10,000,000 shares of blank check preferred stock.

Item 5. Other Information

None.

Item 6. Exhibits

Exhibit Number	Description of Exhibit
31.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements 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.

LINK RESOURCES INC.

By: /s/ Anthony Zaradic

Anthony Zaradic, President,

Chief Executive Officer and

Chief Financial Officer Director

Date: October 15, 2009