**UNITED
        STATES SECURITIES AND EXCHANGE COMMISSION**
 **Washington,
        D.C. 20549**
 
 **Form
        10-QSB**
 
 (Mark
        One)
 
 [X]  QUARTERLY
        REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
        1934
 
 **For
        the quarterly period ended June 30, 2005**
 
 
 [
        ]  TRANSITION
        REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
 
 For
        the
        transition period from _______________ to _______________.
 
 
 **Commission
        file number: 333-95549**
 
 
 **Galaxy
        Minerals, Inc.**
 (Exact
        name of small business issuer as specified in its charter)
 
 
 **Florida**
                (State
                  or other jurisdiction of
                incorporation
                  or organization)
              **65-0974212**
                (IRS
                  Employer
                Identification
                  No.)**500
                  Park Avenue, Suite 203**
                **Lake
                  Villa, IL 60046**
                (Address
                  of principal executive offices)**(847)
                  265-7600**
                (Issuer’s
                  telephone number)
 
 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
 
 
 **APPLICABLE
        ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DUIRNG THE PRECEDING FIV
        EYEARS**
 
 Check
        whether the registrant filed all documents and reports required to be filed
        by
        Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities
        under a plan confirmed by a court. Yes o No o
 
 
 **APPLICABLE
        ONLY TO CORPORATE ISSUERS**
 
 State
        the
        number of shares outstanding of each of the issuer’s classes of common equity,
        as of the latest practicable date. As of September 13, 2005, there were
        446,603,616 shares of common stock, par value $0.001, issued and
        outstanding.
 
 
 **Transitional
        Small Business Disclosure Format**
 (check
        one):
 
 Yes
o  No x
 
  
  
 **Galaxy
        Minerals, Inc.**
 
 
 **TABLE
        OF CONTENTS**
 
 
 PART
                  I - FINANCIAL INFORMATIONITEM 1
              Financial Statements
              3ITEM 2
              Managements Discussion and Analysis
                or Plan
                of Operation
              13ITEM 3
              Controls and Procedures
              18PART
                  II - OTHER INFORMATIONITEM
                1
              Legal Proceedings
              20ITEM 2
              Unregistered Sales of Equity Securities
                and
                Use of Proceeds
              20ITEM 3
              Defaults Upon Senior Securities
              20ITEM 4
              Submission of Matters to a Vote of
                Security
                Holders
              20ITEM 5
              Other Information
              21ITEM 6
              Exhibits
              24
 
  
 2
  **PART
        I - FINANCIAL INFORMATION**
 
 
 This
        Quarterly Report includes forward-looking statements within the meaning of
        the
        Securities Exchange Act of 1934 (the “Exchange Act”). These statements are based
        on management’s beliefs and assumptions, and on information currently available
        to management. Forward-looking statements include the information concerning
        our
        possible or assumed future results of operations set forth under the heading
        “Management’s Discussion and Analysis of Financial Condition or Plan of
        Operation.” Forward-looking statements also include statements in which words
        such as “expect,”“anticipate,”“intend,”“plan,”“believe,”“estimate,”“consider” or
        similar expressions are used.
 
 Forward-looking
        statements are not guarantees of future performance. They involve risks,
        uncertainties and assumptions. Our future results and shareholder values
        may
        differ materially from those expressed in these forward-looking statements.
        Readers are cautioned not to put undue reliance on any forward-looking
        statements.
 
 **ITEM
        1**  **Financial
        Statements**
 
 
 
 
  3
   **GALAXY
        MINERALS, INC. AND SUBSIDIARY**
 **(AN
        EXPLORATION STAGE COMPANY)**
 **CONSOLIDATED
        BALANCE SHEET (UNAUDITED)**
 **JUNE
        30, 2005**
  
 
 
 ASSETSCurrent
                  assetsCash
                  and cash equivalents
              
              $
              1,820,386Due
                  from shareholders
              
              
              65,000Marketable
                  securities - trading
              
              
              65,847Deferred
                  tax asset, less valuation allowance of $3,105,137
              
              
              -Total
                  current assets
              
              
              1,951,233Investment
                  in Langley Park Investment PLC
              
              
              1,837,0051,837,005$
              3,788,238LIABILITIES
                  AND STOCKHOLDERS' EQUITYCurrent
                  liabilitiesAccounts
                  payable and accrued expenses
              
              $
              27,800Total
                  current liabilities
              
              
              27,800Minority
                  interest in consolidated joint venture
              
              
              (38,981
              )Convertible
                  debenture
              
              
              1,574,478Total
                  liabilities
              
              
              1,563,297Commitments
                  and contingencies (Notes 4, 8, and 9)Stockholders'
                  equityPreferred
                  Stock - $.001 par value; 10,000,000 sharesauthorized,
                  none issued and outstanding
              
              
              -Common
                  stock - $.001par value; 1,000,000,000 sharesauthorized,
                  478,003,616 issued and outstanding
              
              
              478,003Stock
                  subscription receivable
              
              
              -Additional
                  paid-in-capital
              
              
              18,902,601Deficit
                  accumulated during the exploration stage
              
              
              (16,976,050
              )Deficit
              
              
              (179,613
              )Total
                  stockholders' equity
              
              
              2,224,941$
              3,788,238
 
 See
        accompanying notes to the consolidated financial statements.
 
  4
  **GALAXY
        MINERALS, INC. AND SUBSIDIARY**
 **(AN
        EXPLORATION STAGE COMPANY)**
 **STATEMENTS
        OF OPERATIONS (UNAUDITED)**
 
 
  Cumulative
                  to dateFor
                  the three months ended
              
              For
                  the six months ended
              
              since
                  inceptionJune
                  30
              June
                  30
              (December
                  19,1999)2005
              
              
              2004
              
              
              2005
              
              
              2004
              
              to
                  June 30, 2005EXPLORATION
                  STAGE EXPENSESMinerals
                  property acquisition costs
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              7,120,000Exploration
                  costs
              
              
              2,125,709
              
              
              79,350
              
              
              2,299,859
              
              
              79,350
              
              
              2,343,410Laboratory
                  fees
              
              
              -
              
              
              -
              
              
              1,121
              
              
              -
              
              
              5,385Interest
                  expense
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              4,222Professional
                  and consulting fees
              
              
              700,974
              
              
              300,218
              
              
              1,538,099
              
              
              302,218
              
              
              4,372,847Rent
              
              
              8,000
              
              
              -
              
              
              14,000
              
              
              -
              
              
              14,000General
                  and administrative
              
              
              31,698
              
              
              51
              
              
              55,139
              
              
              210
              
              
              89,260Impairment
                  of investment
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              2,312,774TOTAL
                  EXPLORATION STAGE EXPENSES
              
              
              2,866,381
              
              
              379,619
              
              
              3,908,218
              
              
              381,778
              
              
              16,261,898EXPLORATION
                  STAGE LOSS
              
              
              (2,866,381
              )
              
              (379,619
              )
              
              (3,908,218
              )
              
              (381,778
              )
              
              (16,261,898
              )OTHER
                  EXPENSESLoss
                  on sale of marketable securities - realized
              
              
              (361,144
              )
              
              -
              
              
              (418,722
              )
              
              -
              
              
              (506,129
              )Recovery
                  of loss on sale of marketablesecurities
                  - unrealized
              
              
              237,943
              
              
              -
              
              
              296,092
              
              
              -
              
              
              (28,218
              )TOTAL
                  OTHER EXPENSES
              
              
              (123,201
              )
              
              -
              
              
              (122,630
              )
              
              -
              
              
              (534,347
              )LOSS
                  BEFORE PROVISION FOR INCOME TAXES
              
              
              (2,989,582
              )
              
              (379,619
              )
              
              (4,030,848
              )
              
              (381,778
              )
              
              (16,796,245
              )PROVISION
                  FOR INCOME TAXES
              
              
              -
              
              
              -
              
              
              -
              
              
              -MINORITY
                  INTEREST IN NET LOSS OFCONSOLIDATED
                  JOINT VENTURE
              
              
              -
              
              
              38,916
              
              
              -
              
              
              38,972
              
              
              38,981NET
                  LOSS
              
              $
              (2,989,582
              )
              $
              (340,703
              )
              $
              (4,030,848
              )
              $
              (342,806
              )
              $
              (16,757,264
              )Net
                  loss per common share,basic
                  and fully diluted
              
              $
              (0.01
              )
              $
              (0.00
              )
              $
              (0.01
              )
              $
              (0.00
              )Weighted
                  average common shares outstanding
              
              
              445,210,635
              
              
              298,234,800
              
              
              423,578,431
              
              
              294,957,600
 
 See
        accompanying notes to the consolidated financial statements.
 
  5
  **GALAXY
        MINERALS, INC. AND SUBSIDIARY**
 **(AN
        EXPLORATION STAGE COMPANY)**
 **CONSOLIDATED
        STATEMENTS OF CASH FLOWS (UNAUDITED)**
 **FOR
        THE SIX MONTHS ENDED JUNE 30, 2005 AND 2004**
  
  CumulativeFor
                  the six months ended
              
              since
                  inceptionJune
                  30,
              (December
                  19, 1999)2005
              
              
              2004
              
              to
                  June 30, 2005Cash
                  flows from exploration stage activitiesNet
                  loss
              
              $
              (4,030,848
              )
              $
              (342,806
              )
              $
              (16,757,264
              )Adjustments
                  to reconcile net loss to net cashused
                  in operating activitiesLoss
                  on sale of marketable securities
              
              
              122,630
              
              
              -
              
              
              534,347Impairment
                  of investments
              
              
              -
              
              
              -
              
              
              2,312,774Common
                  stock issued for services
              
              
              2,979,720
              
              
              -
              
              
              5,716,400Common
                  stock issued for minerals propertyacquisition
                  costs
              
              
              -
              
              
              -
              
              
              7,000,000Accrued
                  interest on loan payable officer
              
              
              -
              
              
              -
              
              
              3,067Increase
                  (decrease) in:Accounts
                  payable and accrued expenses
              
              
              13,800
              
              
              (5,585
              )
              
              27,800Total
                  adjustments
              
              
              3,116,150
              
              
              (5,585
              )
              
              15,594,588Net
                  cash used in exploration stage activities
              
              
              (914,698
              )
              
              (348,391
              )
              
              (1,162,876
              )Cash
                  flows from investing activitiesProceeds
                  from sale of marketable securities
              
              
              390,647
              
              
              -
              
              
              1,031,240Net
                  cash provided by investing activities
              
              
              390,647
              
              
              -
              
              
              1,031,240Cash
                  flows from financing activitiesProceeds
                  from convertible debenture
              
              
              1,870,000
              
              
              -
              
              
              1,870,000Proceeds
                  from sales of common stock
              
              
              133,688
              
              
              -
              
              
              139,151Capital
                  contribution from officer
              
              
              
              
              
              7,604
              
              
              16,804Proceeds
                  from shareholder loan
              
              
              -
              
              
              50,100
              
              
              235,372Proceeds
                  from note payable officer
              
              
              -
              
              
              -
              
              
              34,161Shareholder
                  loans
              
              
              (65,000
              )
              
              -
              
              
              (300,372
              )Minority
                  interest in consolidated joint venture
              
              
              0
              
              
              (56
              )
              
              (38,981
              )Net
                  cash provided by financing activities
              
              
              1,938,6822
              
              
              57,648
              
              
              1,952,022Net
                  increase in cash
              
              
              1,414,637
              
              
              (290,743
              )
              
              1,820,386Cash,
                  beginning of period
              
              
              405,749
              
              
              26
              
              
              0Cash,
                  end of period
              
              $
              1,820,386
              
              $
              (290,717
              )
              $
              1,820,386Supplemental
                  disclosure of cash flow informationCash
                  paid during the year forInterest
              
              $
              -
              
              $
              -
              
              $
              -Income
                  taxes
              
              $
              -
              
              $
              -
              
              $
              -Non-cash
                  financing ActivitiesCommon
                  stock issued for services
              
              $
              2,979,720
              
              $
              280,000
              
              $
              5,716,400Common
                  stock issued for investment
              
              $
              -
              
              $
              -
              
              $
              6,000,000Common
                  stock issued for mineralsproperty
                  acquisition costs
              
              $
              -
              
              $
              -
              
              $
              7,000,000
  6
  **GALAXY
        MINERALS, INC. AND SUBSIDIARY**
 **(AN
        EXPLORATION STAGE COMPANY)**
 **CONSOLIDATED
        STATEMENTS OF CASH FLOWS (UNAUDITED)**
 **FOR
        THE SIX MONTHS ENDED JUNE 30, 2005 AND 2004**
 **(CONT.)**
  
  Cumulativesince
                    inceptionFor
                    the six months ended
                
                (December
                    19, 1999)June
                    30,
                
                to
                    June 30, 20052005
                
                
                2004Common
                    stock issued for commissions
                
                
                
                
                $
                -
                
                $
                -
                
                $
                1,800,000Advances
                    contributed to capital by officer
                
                
                
                
                $
                -
                
                $
                7,604
                
                $
                44,832Unrealized
                    loss on available-for-sale securities,net
                    of deferred tax of $-
                
                
                
                
                $
                -
                
                $
                -
                
                $
                324,310
 
 See
        accompanying notes to the consolidated financial statements.
 
 
  7
   **GALAXY
        MINERALS, INC. AND SUBSIDIARY**
 **(AN
        EXPLORATION STAGE COMPANY)**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**
  NOTE
        1.
        BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 Business
        Activity - Galaxy Minerals, Inc. and Subsidiary ("the Company") (an exploration
        stage company) is a Florida corporation formed in December 1999, originally
        to
        provide memorial products and services through the Internet. On February
        23,
        2004, there was a change of control of the Company when the previous majority
        owner sold 7,550,000 shares,
        representing approximately 91% of the then issued common shares of
        the  Company
        to Yellow Jacket Investments Limited, a British Virgin Islands
        company. Following the reverse acquisition of Yellow Jacket Finance Limited (a British
        Virgin Islands company) on April 20, 2004, the Company is engaged in the
        acquisition, development and exploitation of mineral rights.
 
 Reverse
        Merger - The acquisition of Yellow Jacket Finance Limited was effected through
        a
        share exchange. The Company issued 241 million shares of its common stock
        in
        exchange for the entire share capital of Yellow Jacket Finance
        Limited. The
        transaction has been reflected in the accounts of the Company as a reverse merger.
        The aggregate par value of the 241 million shares issued by the
        Company has been
        applied first against additional paid-in capital, with the balance to deficit.
        Prior year financial statements have been restated to show the
        activity of
        Yellow Jacket Finance Limited.
 
 Basis
        of
        Consolidation - The consolidated financial statements include the accounts
        of
        Galaxy Minerals, Inc. and its wholly-owned subsidiary, Yellow Jacket Finance
        Limited. All material intercompany balances and transactions were eliminated
        in
        the consolidation.
 
 Unaudited
        Consolidated Financial Statements - The unaudited consolidated financial
        statements as of and for the three and six months ended June 30, 2005 and
        2004,
        have been prepared in accordance with accounting principles generally accepted
        in the United States of America for interim financial information and with
        the
        instructions to Form 10-QSB. Accordingly, they do not include all of the
        information and footnotes required by accounting principles generally accepted
        in the United States of America for complete financial statements. In the
        opinion of management, all adjustments (consisting of normal recurring accruals)
        considered necessary for a fair presentation have been included. Operating
        results for the six months ended June 30, 2005, are not necessarily indicative
        of the results that may be expected for the year ending December 31,
        2005.
 
 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 estimates and assumptions that affect the
        reported amounts
        of assets and liabilities and disclosures of contingent assets and liabilities
        at the date of the dated financial statements and the reported amounts of
        revenues and expenses during the reporting periods. Actual results could
        differ from those estimates.
 
 Income
        Taxes - The Company follows Statement of Financial Accounting Standards No.
        109
        (FAS 109), "Accounting for Income Taxes". FAS 109 is an asset and liability
        approach that requires the recognition of deferred tax assets and liabilities
        for the expected future tax consequences of the difference in events  that
        have
        been recognized in the Company's financial statements compared to
        the tax
        returns.
 
 8
 Basic
        And
        Fully Diluted Net Loss Per Common Share - The Company follows the provisions
        of FASB Statement No. 128 (SFAS No. 128), "Earnings Per Share". SFAS  No.
        128
        requires companies to present basic earnings per share (EPS) and
        diluted EPS,
        instead of primary and fully diluted EPS presentations that were formerly
        required by Accounting Principles Board Opinion No. 15, "Earnings Per Share".
        Basic EPS is computed by dividing net income or loss by the weighted average
        number of common shares outstanding during each year.
 
 Exploration
        Stage Company - The Company has been devoting its efforts to activities
        such as acquiring minerals rights, raising capital, establishing sources
        of information, and developing plans for the exploitation of its minerals
        rights. The Company has not yet generated any revenues and, as such,
        it is
        considered an exploration stage company.
  Mineral
        Properties - Costs of acquisition, exploration, carrying, and
        retaining unproven
        properties are expensed as incurred.
 
 NOTE
        2.
        INCOME TAXES
 At
        June
        30, 2005, the Company had a net operating loss carry forward of approximately
        $14,100,000 and a capital loss carryforward of approximately $146,000. The
        net
        operating loss may be carried forward to offset federal income taxes in various
        future years through year 2024 and the capital loss may be carried forward
        to
        future years through 2009. During the year 2003, there was a significant
        ownership change in the Company as defined in Section 382 of the Internal
        Revenue Code. As a result of these changes, the Company's ability to utilize
        net
        operating losses available before the ownership change is restricted
        to a percentage of the market value of the Company at the time of
        the ownership change. Therefore, substantial net operating loss carry forwards
        will, in
        all
        likelihood, be reduced or eliminated in future years due to the change
        in ownership.
 
 SFAS
        No.
        109 provides for the recognition and measurement of deferred income
        tax benefits
        based on the likelihood of their realization in future years. A valuation
        allowance must be established to reduce deferred income tax benefits if it
        is
        more likely than not that, a portion of the deferred income tax benefits
        will
        not be realized. It is management's opinion that the entire deferred tax
        benefit
        of $3,105,137 resulting from the net operating loss carry forward may not
        be
        recognized in future years. Therefore, a valuation allowance equal to the
        deferred tax benefit of $3,105,137 has been established, resulting in no
        deferred tax benefit as of the balance sheet date.
 
 NOTE
        3.
        GOING CONCERN AND MANAGEMENT'S PLANS
 As
        reflected in the accompanying financial statements, the Company incurred
        net
        losses of approximately $4,000,000 for the six months ended June 30, 2005,
        and
        has an accumulated deficit of $16,976,050. The ability of the Company to
        continue as a going concern is dependent upon its ability to obtain
        financing and
        achieve profitable operations. Although the Company completed a financing
        via a
        stock exchange with Langley Park Investments Plc of the UK on September 30, 2004,
        and
        a securities purchase agreement with GCA Securities investment fund on May
        9,
        2005, the Company cannot be sure of meeting its cash requirements until such
        time as it
        begins operations. The consolidated financial statements do not include any
        adjustments that might be necessary should the Company be unable to
        continue as a
        going concern.
 
 
 The
        Company’s business of acquiring, developing and exploiting minerals rights is
        contingent upon its ability to secure adequate financing. Management believes
        that this financing will be necessary in order for the Company to continue.
        The
        Company is actively pursuing several forms of equity financing, although
        there
        can be no assurances that we will be successful in procuring such financing
        or
        that it will
        be
        available on terms acceptable to the company.
 
 9
 NOTE
        4.
        COMMITMENTS AND CONTINGENCIES
 
 The
        Company has executive offices in the residence of one of its
        shareholders  and its joint
        venture in
        the
        Yellow Jacket and Phoenix mines. The Company occupies approximately 2,400
        square
        feet, for a monthly rental fee of $2,500.
 
 The
        Company was informed that an action may have been filed in District
        Court against
        another company and that the Company may have been listed as a party under
        its
        former name, HeavenExpress.Com, Inc. The Company believes the action may
        have
        been filed on November 14, 2003, but that at no time since that date, has
        the
        Company been served with process nor to its knowledge has any effort been
        made
        to serve it with process. Pursuant to Federal Rule of Civil
        Procedure 4(m),
        since March 16, 2004, more than 120 days has passed since the filing of this
        action without the plaintiff ever attempting to serve the Company, the action
        is
        subject to being dismissed, and there has not been any effort by the plaintiff
        to seek to extend the time period within which to serve the
        Company.
 
 In
        light
        of the foregoing, this action does not appear to constitute pending
        or threatened legal action against the Company at this point.
 
 Oatman/Lexington
        Mines
 
 On
        October 31, 2004, the Company entered into a joint venture agreement with
        Searchlight Exploration, LLC (Searchlight), an Arizona limited liability
        company, that owns the Oatman/Lexington Mines. The Oatman/Lexington Mines
        consist of 7 patented (privately-owned land where the owner can mine or convey
        rights to the property and 76 unpatented (government-owned land where the
        government has conveyed the right to mine the property) mining claims in
        and
        around Oatman, Arizona. Pursuant to a joint venture agreement, the Company
        has
        the right to take samples and explore at this mine and must put at least
        $100,000 of the work into the exploration and sampling at this mine. Under
        the
        agreement, the Company pays $10,000 per quarter for the rights under this
        agreement. If the Company fails to make these payments, Searchlight has the
        right to terminate this agreement and disallow further exploration at the
        mine.
 
 Bonanza
        Project
 
 On
        October 31, 2004, the Company entered into a joint venture agreement with
        Searchlight, that also owns Bonanza Mine. The Bonanza Mine consists of
        approximately 4,000 acres of land located in Mohave County, Arizona. Pursuant
        to
        a joint venture agreement, the Company has the right to take samples and
        explore
        at this mine and must put at least $100,000 of work into the exploration
        and
        sampling at this mine. Under the agreement, the Company pays $10,000 per
        quarter
        for the rights. If the Company fails to make these payments, Searchlight
        has the
        right to terminate this agreement and disallow further exploration at the
        mine.
 
 As
        of
        June 30, 2005, other than the projects described above, the Company had no
        commitments with respect to the development of its mineral assets.
 
 10
 On
        May 9,
        2005, the Company entered into a securities purchase agreement with GCA
        Strategic Investment Fund Limited (“GCA Fund”). Pursuant to the agreement, GCA
        Fund agreed to purchase Convertible Secured Promissory Notes not to exceed
        $6,000,000. Upon execution of the agreement GCA Fund purchased $2,200,000
        of
        notes which provided the Company with $1,870,000 in cash. The Company paid
        a
        finders fee of $273,000 in connection with this transaction. GCA Fund has
        the
        right to exchange the notes for common stock and stock warrants. On May 9,
        GCA
        Fund was issued warrants to purchase 9,705,882 shares of common stock with
        an
        indeterminable exercise price based on the market value of the Company’s common
        stock.
 
 NOTE
        5.
        STOCKHOLDERS’ EQUITY
 
 Pursuant
        to a resolution of the Directors, on April 15, 2004, the Company affected
        a 4-for-1 reverse stock split of its common stock. There were
        8,270,000  shares
        of
        Common Stock outstanding prior to the reverse stock split.
        Immediately following the reverse stock split, there were 2,067,500 shares issued and
        outstanding. The prior year financial statements have been restated to reflect
        the reverse stock split.
 
 On
        March
        16, 2005, the Company declared a 20% stock dividend to the stockholders of
        record as of March 31, 2005. The financial statements have been retroactively
        restated to reflect the 20% stock dividend.
 
 NOTE
        6.
        JOINT VENTURE
 
 On
        February 14, 2004, Yellow Jacket Finance Limited ("YJF") and Stealth
        Enterprises, Inc. ("Stealth") entered into a Memorandum of Joint Venture
        Agreement "JV Agreement"). Under the terms of the JV Agreement, JYF and Stealth
        agreed to share the net proceeds from the exploitation of 52 mineral claims,
        totaling 1,040 acres, in Santa Cruz County, Arizona in the ratio 51:49. The minerals
        claims are owned by Stealth. Although YJF agreed to procure loans of
        up  to
        $1.1
        million for the exploitation of the Yellow Jacket and Phoenix mines,
        the Company
        expects to be able to fund the exploration from its own resources and has
        released YJF from its commitment. YJF, in turn, has released Yellow Jacket
        Investments Limited from its commitment to YJF. The Company acquired YJF
        on
        April 26, 2004, in a transaction accounted for as a reverse merger.
 
 Because
        the Company has a 51% interest in the extracted minerals and no ownership
        of the
        mine, Stealth owns 100 percent of the mine, the joint venture is not
        consolidated in the financial statements
        of the Company.
        Instead, the actual costs of exploration and extraction have been recorded
        in
        the financial statements .
 
 NOTE
        7.
        CONSULTING FEES AND DIRECTORS’ FEES
 
 On
        January 27, 2005, the Company issued 250,000 restricted shares in consideration
        for consulting services rendered. In addition, on the same day, 1,000,000
        restricted and 1,500,000 restricted shares were issued to two of the
        three
        directors of the Company in consideration for directors' fees. The
        value of the Company's stock on January 27, 2005, was $0.27. The entire implied
        cost of the consulting fees and directors' fees of $675,250 was recognized
        as an
        expense in the statement of operations for the quarter.
 
 On
        February 17, 2005, the Company issued 5,800,000 shares in consideration for consulting
        services pursuant to a 2004 compensation agreement. The shares were issued
        at
        par value, $.001 .
        The
        entire implied cost of the consulting fees of $5,800 was recognized as an
        expense in the statement of operations for the quarter.
 
 11
 On
        March
        28, 2005, the Company issued 1,000,000 restricted shares to a director of
        the
        Company in consideration of directors’ fees. The value of the Company’s stock on
        March 28, 2005 was $0.19. The entire implied cost of director’s fees of $130,000
        was recognized as an expense in the statement of operations for the
        quarter.
 
 On
        March
        29, 2005, the Company issued 8,600,000 shares in consideration for consulting
        services pursuant to a 2004 compensation agreement. In addition, on the same
        day
        the Company issued 50,000 shares for legal services rendered. The shares
        were
        issued at par value, $.001. The entire implied cost of $8,650 of services
        rendered was recognized as an expense in the statement of operations for
        the
        quarter.
 
 On
        April
        8, 2005 the Company issued 500,000 shares in consideration for consulting
        services regarding the acquisition of mineral rights. The value of the Company’s
        stock on April 8, 2005 was $0.105. The entire implied cost of $52,500 was
        recognized as an expense in the statement of operations for the
        quarter.
 
 On
        May
        20, 2005 the Company issued 59,500,000 shares in consideration for consulting
        services regarding the acquisition of mineral rights. The value of the Company’s
        stock on May 20, 2005 was $0.35. The entire implied cost of $2,082,500 was
        recognized as an expense in the statement of operations for the
        quarter.
 
 NOTE
        8.
        MARKETABLE SECURITIES
 
 The
        company classifies marketable securities in two categories: trading securities
        and available-for-sale securities. Trading securities are measured at fair
        value, with unrealized gains and losses included in income. Available-for-sale
        securities are measured at fair value, with net unrealized gains and losses
        reported in other comprehensive income. Available-for-sale securities with
        measured declines that are not considered temporary are included in income.
        The
        company’s marketable equity securities have been classified as
        available-for-sale securities. Fair values for marketable securities are
        based
        on quoted market prices. The following is a summary of the company’s investment
        in marketable equity securities as of June 30, 2005:
 
 Securities
                
                
                Cost
                
                
                Unrealized
                    Losses
                
                
                Estimated
                    Fair ValueLangley
                  Park Investments Plc
                
                $
                308,842
                
                
                ($
                    242,994
                )
                $
                65,847
 
 12
   **ITEM
        2**  **Managements
        Discussion and Analysis or Plan of Operation**
 
 The
        following discussion contains forward-looking statements that involve risks
        and
        uncertainties. Our actual results could differ materially from those anticipated
        in these forward-looking statements as a result of many factors. The following
        discussion should be read together with our financial statements and the
        notes
        to those financial statements included elsewhere in this Quarterly Report,
        as
        well as our Annual Report on Form 10-KSB for the year ended December 31,
        2004.
 
 Except
        for historical information, the materials contained in this Management’s
        Discussion and Analysis are forward-looking (within the meaning of Section
        27A
        of the Securities Act of 1933 and Section 21E of the Securities Exchange
        Act of
        1934) and involve a number of risks and uncertainties. These include the
        Company’s historical losses, the need to manage its growth, general economic
        downturns, intense competition in the emissions testing industry, seasonality
        of
        quarterly results, and other risks detailed from time to time in the Company’s
        filings with the Securities and Exchange Commission. Although forward-looking
        statements in this Quarterly Report reflect the good faith judgment of
        management, such statements can only be based on facts and factors currently
        known by the Company. Consequently, forward-looking statements are inherently
        subject to risks and uncertainties, actual results and outcomes may differ
        materially from the results and outcomes discussed in the forward-looking
        statements. Readers are urged to carefully review and consider the various
        disclosures made by the Company in this Quarterly Report, as an attempt to
        advise interested parties of the risks and factors that may affect the Company’s
        business, financial condition, and results of operations and
        prospects.
 
 **Summary
        Overview**
 
 We
        are an
        exploration stage company involved in the exploration for natural minerals
        in
        several mines, which we own some or all of the minerals rights to mine. Through
        our subsidiary, we have the minerals rights to mine four different mines.
        To
        date, we have conducted exploratory activities at several of these locations
        but
        have not mined any minerals from the mines, other than samples, and have
        not
        derived any revenues from our current business operations, and have not had
        revenues in our last two fiscal years ended December 31, 2004, and 2003.
 
 Plan
        of Operation
 
 Our
        plans
        for the exploration of these projects has not materially changed since the
        filing of our Annual Report on Form 10-KSB for the year ended December 31,
        2004.
        For our exploration activities at the properties, we continue to evaluate
        the
        results from the exploration and the surface sampling at the four mines.
        Based
        on the geological reports of Parkinson Geologic, we believe the placement
        of a
        pilot plant, which is a tool that extracts minerals from the rocks in the
        mine,
        at the Yellow Jacket and Phoenix Mine would be advantageous at this time
        and
        plan to put one in place as soon as the proper preparations can be made for
        the
        installment of the plant. We are also in the process of determining the optimal
        method for determining if any mineral prospects exist at the other mining
        locations. At the same time, we are evaluating other minerals opportunities
        with
        a view to diversifying our activities.
 
 On
        May 9,
        2005, we entered into a Securities Purchase Agreement (the “Agreement”) with GCA
        Strategic Investment Fund Limited (“GCA Fund”), pursuant to which GCA Fund
        agreed to purchase Convertible Secured Promissory Notes (the “Notes”) from us,
        in an amount up to a total of $6,000,000. Under the Agreement, GCA Fund will
        purchase the Notes at our request until a total of $6,000,000 in Notes has
        been
        purchased.
 
 Upon
        the
        execution of the Agreement, on May 9, 2005, at our request, GCA purchased
        Notes
        totaling $2,200,000. Under the terms of the Agreement and the Notes, we only
        receive 85% of our requested amount in cash. Therefore, on May 9, 2005, we
        received $1,870,000 from GCA Fund in exchange for the Note totaling $2,200,000.
        GCA Fund has also given us written confirmation of their intention to purchase
        an additional $300,000 Note as soon as we are able to increase our authorized
        common stock. We believe this $1,870,000 will be sufficient to fund our
        operations for the next six to twelve months.
 
 13
 Change
        in Employees
 
 We
        do not
        have any plans to change our number of employees in the foreseeable future.
        We
        plan to continue to utilize independent contractors for the exploration
        activities, to locate possible new mineral rights opportunities, and for
        some of
        our general business affairs.
 
 Explanatory
        Paragraph in Report of Our Independent Certified Public
        Accountants
 
 Our
        independent accountants have included an explanatory paragraph in their most
        recent report, stating that our audited financial statements for the period
        ending December 31, 2004, were prepared assuming that we will continue as
        a
        going concern. However, they note that we were an exploration stage company
        and
        have suffered recurring losses from operations and recurring deficiencies
        in
        working capital that raise substantial doubt about our ability to continue
        as a
        going concern. Our
        going
        concern paragraph may be viewed by some shareholders and investors as an
        indication of financial instability, and it may impair our ability to raise
        capital.
 
 **The
        following analysis compares the results of operations for the three-month
        period
        ended June 30, 2005 to the comparable period ended June 30,
        2004**
 
 **Results
        of Operations**
 
 Introduction
        and Plan of Operation
 
 Results
        for the three months ended June 30, 2005, are much different than our results
        for the three months ended June 30, 2004, due to our change from a company
        with
        little or no operations to an exploration stage company in the mining industry
        as a result of our acquisition of Yellow Jacket Finance Limited in April
        2004,
        and our joint venture agreements with various third parties to explore four
        mines. Our financial statements for the quarter ended June 30, 2005, reflect
        this change in our business operations. While we had no revenues for the
        quarter
        ended June 30, 2005, we incurred significant exploration stage costs due
        to the
        costs associated with our acquisition of certain mining rights and therefore
        we
        continue to operate at a substantial loss. Our operations consist primarily
        of
        the initial exploration of our recently acquired mineral rights. We do not
        anticipate having any revenues in the foreseeable future and our activities
        until that time will continue to be primarily the acquisition and exploration
        of
        mineral rights.
 
 Revenues
        and Loss from Operations
 
 Our
        revenues, exploration expenses, operating expenses, and loss before taxes
        for
        the quarter ended June 30, 2005, as compared to the quarter ended June 30,
        2004,
        are as follows:
 
 14
 
 
 
 Quarter
                  Ended
              
              Quarter
                  EndedJune
                  30, 2005
              
              June
                  30, 2004Revenues
              
              $
              -
              
              $
              -Minerals
                  property acquisition costs
              
              
              -
              
              
              -Exploration
                  costs
              
              
              2,125,709
              
              
              79,350Laboratory
                  fees
              
              
              -
              
              
              -Professional
                  and consulting fees
              
              
              700,974
              
              
              300,218Interest
                  expenses
              
              
              -
              
              
              -Rent
              
              
              8,000
              
              
              -General
                  and administrative
              
              
              31,698
              
              
              51Impairment
                  of investment
              
              
              -
              
              
              -Total
                  exploration stage expenses
              
              
              2,866,381
              
              
              379,619Total
                  other expenses
              
              
              (123,201
              )
              
              -Loss
                  before taxes and other Gains (Losses)
              
              
              (2,989,582
              )
              
              (379,619
              )
 
 Taxes,
        Joint Venture Interests, and Net Loss
 
 Our
        taxes, income from joint venture interest, and net loss for the quarter ended
        June 30, 2005, as compared to the quarter ended June 30, 2004, are as
        follows:
 
 Quarter
                  Ended
              
              Quarter
                  EndedJune
                  30, 2005
              
              June
                  30, 2004Income
                  tax provision
              
              $
              -
              
              $
              -Minority
                  interest in joint venture
              
              
              -
              
              
              38,916Net
                  loss
              
              
              (2,989,582
              )
              
              (340,703
              )
 
 Our
        net
        loss for the three months ended June 30, 2005, was ($2,989,582) compared
        to
        ($340,703) for the three months ended June 30, 2004. The significant increase
        in
        our net loss was due to the fact that we acquired Yellow Jacket Finance Limited
        and did not began exploratory operations until April 2004. These exploration
        stage expenses accounted for $2,866,381 of our net loss. The other gains
        (losses) of realized gain on the sale of marketable securities for the three
        months ended totaled ($361,144) and the other gains (losses) of unrealized
        gain
        on the sale of marketable securities for the same period totaled
        237,943.
 
 **The
        following analysis compares the results of operations for the six-month period
        ended June 30, 2005 to the comparable period ended June 30,
        2004**
 
 **Results
        of Operations**
 
 Introduction
        and Plan of Operation
 
 For
        the
        same reasons as set forth above, our results for the six months ended June
        30,
        2005, are significantly different than our results for the six months ended
        June
        30, 2004. We had no revenues for the six months ended June 30, 2005, but
        we
        incurred significant exploration stage costs due to the costs associated
        with
        our acquisition of certain mining rights and therefore we continue to operate
        at
        a substantial loss. Our operations consist primarily of the initial exploration
        of our recently acquired mining claims. We do not anticipate having any revenues
        in the foreseeable future and our activities until that time will continue
        to be
        primarily the acquisition and initial exploration of mining claims.
 
 15
 Revenues
        and Loss from Operations
 
 Our
        revenues, exploration expenses, operating expenses, and loss before taxes
        for
        the six months ended June 30, 2005, as compared to the six months ended June
        30,
        2004, are as follows:
 
 Six
                  Months Ended
              
              Six
                  Months EndedJune
                  30, 2005
              
              June
                  30, 2004Revenues
              
              $
              -
              
              $
              -Minerals
                  property acquisition costs
              
              
              -
              
              
              -Exploration
                  expenses
              
              
              2,299,859
              
              
              79,350Laboratory
                  expenses
              
              
              1,121
              
              
              -Professional
                  and consulting fees
              
              
              1,538,099
              
              
              302,218Interest
                  expenses
              
              
              -
              
              
              -Rent
              
              
              14,000
              
              
              -General
                  and administrative
              
              
              55,139
              
              
              210Impairment
                  of investment
              
              
              -
              
              
              -Total
                  exploration stage expenses
              
              
              3,908,218
              
              
              381,778Total
                  other expenses
              
              
              (122,630
              )
              
              -Loss
                  before taxes and other Gains (Losses)
              
              
              (4,030,848
              )
              
              (381,778
              )
 
 Taxes,
        Joint Venture Interests, and Net Loss
 
 Our
        taxes, income from joint venture interest, and net loss for the six months
        ended
        June 30, 2005, as compared to the six months ended June 30, 2004, are as
        follows:
 
 Six
                  months Ended
              
              Six
                  months EndedJune
                  30, 2005
              
              June
                  30, 2004Income
                  tax provision
              
              $
              -
              
              $
              -Minority
                  interest in joint venture
              
              
              -
              
              
              38,972Net
                  loss
              
              
              (4,030,848
              )
              
              (342,806
              )
 
 Our
        net
        loss for the six months ended June 30, 2005, was ($4,030,848) compared to
        (342,806) for the six months ended June 30, 2004. The significant increase
        in
        our net loss was due to the fact that we acquired Yellow Jacket Finance Limited
        and did not began exploratory mining operations until April 2004, so our
        expenses were relatively small for the six months ended June 30, 2004, compared
        to the same period in 2005. These exploration stage expenses accounted for
        $3,908,218 of our net loss for this six-month period. The other gains (losses)
        of realized gain on the sale of marketable securities for the six months
        ended
        June 30, 2005, totaled ($418,722), while the other gains (losses) of unrealized
        gain on the sale of marketable securities for the same period totaled
        296,092.
 
 16
 **Liquidity
        and Capital Resources**
 
 Introduction
 
 We
        have
        not generated any revenue to date from our exploration stage activities.
        We have
        primarily financed our activities from loans from our shareholders. We received
        loans from a shareholder to undertake the Yellow Jacket and Phoenix drilling
        programs. Substantially all of these loans were drawn and expended in the
        second
        quarter of 2004.
 
 Our
        cash,
        total assets, and total liabilities as of June 30, 2005, as compared to June
        30,
        2004, are as follows:
 
 As
                  of
              
              As
                  ofJune
                  30,
              
              June
                  302005
              
              2004Cash
                  and cash equivalents
              
              $
              1,820,386
              
              $
              566Total
                  current assets
              
              
              1,951,233
              
              
              566Total
                  assets
              
              
              3,788,238
              
              
              566Total
                  current liabilities
              
              
              27,800
              
              
              102,318
 
 Our
        cash
        and cash equivalents have increased substantially due to the closing of a
        financing deal for up to $6,000,000, of which, to date, we have received
        $1,870,000 in exchange for a $2,200,000 principal amount convertible promissory
        note. The difference between our current assets and our total assets is a
        result
        of the stock swap arrangements with Langley Park Investments PLC. Under the
        terms of the stock swap we exchanged some of our common stock for common
        stock
        of Langley Park Investments PLC.
 
 Cash
        Requirements
 
 On
        May 9,
        2005, we closed a financing arrangement for up to $6,000,000 in financing.
        The
        terms of this financing deal are further detailed herein. On May 9, 2005,
        upon
        the closing of this financing we received $1,870,000 in exchange for a
        $2,200,000 principal amount convertible promissory note. We believe this
        financing deal will provide us the cash necessary to operate for the next
        six to
        twelve months.
 
 Sources
        and Uses of Cash
 
 *Operations*
 
 Net
        cash
        used by exploration stage activities operations was ($914,698) for the six
        months ended June 30, 2005, as compared to ($348,391) for the same period
        in
        2004. Negative operating cash flows during the six months ended June 30,
        2005,
        were created primarily by corporate fixed and overhead expenses.
 
 17
 *Investing*
 
 Net
        cash
        provided by investing activities was $390,647 and $0, for the six months
        ended
        June 30, 2005 and 2004, respectively. Investing activities for the six months
        ended June 30, 2005, consisted entirely of proceeds from the sales of marketable
        securities.
 
 *Financing*
 
 Net
        cash
        provided by financing activities was $1,938,688 and $57,648, for the six
        months
        ended June 30, 2005 and 2004, respectively. In the six months ended June
        30,
        2005, financing activities primarily included proceeds from sale of a $2,200,000
        principal amount convertible debenture, for which we received $1,870,000,
        and
        proceeds from the sales of common stock of $133,688. Net cash provided by
        financing activities during the six months ended June 30, 2004, included
        a
        capital contribution from an officer totaling $7,604, and loans to us from
        a
        shareholder totaling $50,100.
 
 **Debt
        Instruments, Guarantees, and Related Covenants**
 
 As
        of
        June 30, 2005 we had the $2,200,000 convertible debenture outstanding. Under
        the
        terms of the financing arrangement, if we do not timely pay the debenture
        in
        accordance with its terms it begins to accrue interest at a rate of twelve
        percent (12%) per annum. The holder also has the option, at any time, to
        convert
        the amounts due under the debenture into shares of our common stock. The
        number
        of shares of common stock to be issued upon each conversion shall be determined
        by dividing the amount to be converted by the conversion price in effect
        on the
        date a notice of conversion is delivered to us. The conversion price is equal
        to
        95% of the average of the three lowest closing bid prices for the twenty
        (20)
        trading days immediately prior to the date of the related notice of conversion.
        As of June 30, 2005, we did not have additional outstanding debt instruments,
        guarantees, or related covenants. As of June 30, 2004, we did have any
        outstanding debt instruments, guarantees, or related covenants.
 
 **Critical
        Accounting Policies**
 
 The
        Company accounts for its stock-based compensation arrangements with employees
        in
        accordance with Accounting Principles Board Opinion No. 25, "Accounting for
        Stock Issued to Employees" ("APB 25") and related interpretations. As such,
        compensation expense under fixed term option plans is recorded at the date
        of
        grant only to the extent that the market value of the underlying stock at
        the
        date of grant exceeds the exercise price.  The Company recognizes
        compensation expense for stock options, common stock and other equity
        instruments issued to non-employees for services received based upon the
        fair
        value of the services or equity instruments issued, whichever is more reliably
        determined.  Stock compensation expense is recognized as the stock
        option
        is earned, which is generally over the vesting period of the underlying
        option.
 
 **ITEM
        3**  **Controls
        and Procedures**
 
 The
        Company's Chief Executive Officer and Chief Financial Officer (or those persons
        performing similar functions), after evaluating the effectiveness of the
        Company's disclosure controls and procedures (as defined in Rules 13a-14(c)
        and
        15d-14(c) under the Securities Exchange Act of 1934, as amended) as of a
        date
        within 90 days of the filing of this quarterly report (the “Evaluation Date”),
        have concluded that, as of the Evaluation Date, the Company's disclosure
        controls and procedures were effective to ensure the timely collection,
        evaluation and disclosure of information relating to the Company that would
        potentially be subject to disclosure under the Securities Exchange Act of
        1934,
        as amended, and the rules and regulations promulgated thereunder. There were
        no
        significant changes in the Company’s internal controls or in other factors that
        could significantly affect the internal controls subsequent to the Evaluation
        Date.
 
 18
 Changes
        in Internal Control Over Financial Reporting
 
 There
        have been no significant changes in our internal controls or in other factors
        that could significantly affect these controls since the last
        evaluation.
 
 
 
 
  19
   **PART
        II - OTHER INFORMATION**
 
 **ITEM
        1**  **Legal
        Proceedings**
 
 In
        the
        ordinary course of business, we are from time to time involved in various
        pending or threatened legal actions. The litigation process is inherently
        uncertain and it is possible that the resolution of such matters might have
        a
        material adverse effect upon our financial condition and/or results of
        operations. However, in the opinion of our management, matters currently
        pending
        or threatened against us are not expected to have a material adverse effect
        on
        our financial position or results of operations.
 
 **ITEM
        2**  **Unregistered
        Sales of Equity Securities and Use of Proceeds**
 
 Between
        April 13, 2005 and May 20, 2005, we issued a total of 1,854,436 shares of
        our
        common stock, restricted in accordance with Rule 144, to 28 foreign investors
        in
        offshore transactions, for cash totaling $50,075, pursuant to the terms of
        stock
        purchase agreements. The issuance was exempt from registration pursuant to
        Regulation S of the Securities Act of 1933, and the shareholders are
        sophisticated, foreign investors who are familiar with our
        operations.
 On
        May 9,
        2005, we issued a Convertible Secured Promissory Note in the principal amount
        of
        $2,200,000 and Warrants to purchase 9,705,882 shares of our common stock
        to one
        investor, GCA Strategic Investment Fund Limited (“GCA Fund”), in exchange for
        $1,870,000 in cash. The issuance was exempt from registration pursuant to
        Section 4(2) of the Securities Act of 1933, and the shareholder is accredited.
        The Note is due five years from its date of issuance and if we do not timely
        pay
        the Note in accordance with its terms it begins to accrue interest at a rate
        of
        twelve percent (12%) per annum. GCA Fund also has the option, at any time,
        to
        convert the amounts due under the Note into shares of our common stock. The
        number of shares of common stock to be issued upon each conversion shall
        be
        determined by dividing the amount to be converted by the conversion price
        in
        effect on the date a notice of conversion is delivered to us. The conversion
        price is equal to 95% of the average of the three lowest closing bid prices
        for
        the twenty (20) trading days immediately prior to the date of the related
        notice
        of conversion.
 
 In
        April
        and May 2005, we issued 60,000,000 shares of our common stock, restricted
        in
        accordance with Rule 144, to 3 different entities under the terms of those
        certain joint venture agreements under which we acquired certain of the mineral
        rights we own in the four mines. The issuances were exempt from registration
        pursuant to Section 4(2) of the Securities Act of 1933, and the investors
        were
        sophisticated investors.
 
 **ITEM
        3**  **Defaults
        Upon Senior Securities**
 
 There
        have been no events that are required to be reported under this
        Item.
 
 **ITEM
        4**  **Submission
        of Matters to a Vote of Security Holders**
 
 At
        the
        2005 Annual Meeting of Shareholders, held on July 25, 2005, the shareholders
        approved the following agenda items as set forth in the Company’s 14C
        Information Statement on file with the SEC:
 
 1.  Three
        individuals were elected to our Board of Directors, namely
        Matthew J. Symonds, Dr. Thomas P. Fry, and David L. Mayer. Mr. Symonds is
        an
        employee-director and Messrs. Fry and Mayer are outside (non-employee)
        directors. All three were directors prior to the meeting. The results of
        the
        voting were as follows:
 
 20
 Director
              Votes
                  For
              Votes
                  Against
              Votes
                  Withheld
              Abstentions
              Broker
                  Non-VotesMatthew
                  J. Symonds
              285,997,158
              -0-
              -0-
              -0-
              -0-Dr.
                  Thomas P. Fry
              285,997,158
              -0-
              -0-
              -0-
              -0-David
                  L. Mayer
              285,997,158
              -0-
              -0-
              -0-
              -0-
 
 The
        other
        matters on which the shareholders voted, and the results of voting,
        were:
 
 2.  An
        amendment to the Articles of Incorporation to increase the authorized common
        stock from 500,000,000 shares, par value $0.001, to 1,000,000,000 shares,
        par
        value $0.001. This agenda item passed as follows:
 
 Votes
                  For
              Votes
                  Against
              Votes
                  Withheld
              Abstentions
              Broker
                  Non-Votes285,997,158
              -0-
              -0-
              -0-
              -0-
 
 The
        amendment to the Articles of Incorporation was filed with the State of Florida
        on July 25, 2005, with an effective date of July 26, 2005.
 
 A
        more
        detailed description of each agenda item at the annual shareholders meeting
        can
        be found in our Schedule 14C Information Statement dated and filed with the
        Securities and Exchange Commission on April 29, 2005 and our Amended Schedule
        14C dated and filed with the Securities and Exchange Commission on June 14,
        2005.
 
 **ITEM
        5**  **Other
        Information**
 
 Stock
        Dividend
 
 On
        April
        1, 2005, we issued a stock dividend, equal to one share of our common stock
        for
        each five shares of our common stock owned, to all of our shareholders as
        of
        March 31, 2005. This dividend was approved by our Board of
        Directors.
 
 GCA
        Strategic Investment Fund Limited Financing
  On
        May 9,
        2005, we entered into a Securities Purchase Agreement (the “Agreement”) with GCA
        Strategic Investment Fund Limited (“GCA Fund”), pursuant to which GCA Fund
        agreed to purchase Convertible Secured Promissory Notes (the “Notes”) from us,
        in an amount up to a total of $6,000,000. Under the Agreement, GCA Fund will
        purchase the Notes at our request until a total of $6,000,000 in Notes has
        been
        purchased.
 
 Upon
        the
        execution of the Agreement, on May 9, 2005, at our request, GCA purchased
        Notes
        totaling $2,200,000. Under the terms of the Agreement and the Notes, we only
        receive 85% of our requested amount in cash. Therefore, on May 9, 2005, we
        received $1,870,000 from GCA Fund in exchange for the Note totaling $2,200,000.
        GCA Fund has also given us written confirmation of their intention to purchase
        an additional $300,000 Note as soon as we are able to increase our authorized
        common stock.
 
 The
        Notes
        are due five years from their date of issuance. If we do not timely pay the
        Notes in accordance with their terms they begin to accrue interest at a rate
        of
        twelve percent (12%) per annum. GCA Fund also has the option, at any time,
        to
        convert the amounts due under the Notes into shares of our common stock.
        The
        number of shares of common stock to be issued upon each conversion shall
        be
        determined by dividing the amount to be converted by the conversion price
        in
        effect on the date a notice of conversion is delivered to us. The conversion
        price is equal to 95% of the average of the three lowest closing bid prices
        for
        the twenty (20) trading days immediately prior to the date of the related
        notice
        of conversion. If GCA Fund elects to convert any amounts due under the Notes,
        in
        addition to the common stock, we will issue GCA Fund a Common Stock Purchase
        Warrant exercisable for shares of our common stock equal to fifteen percent
        (15%) of the number of common shares into which the Notes are convertible
        on the
        trading day prior to the Closing Date. On May 9, 2005, with our initial
        $2,200,000 Note, we issued GCA Fund a warrant to purchase 9,705,882 shares
        of
        our common stock.
 
 21
 Pursuant
        to the terms of a Security Agreement dated May 9, 2005, our repayment of
        the
        principal and interest due under the Notes is secured by all our rights,
        title
        and interest, including proceeds thereof, that we currently have in the
        following: (i) the Joint Venture Agreement relating to the Yellow Jacket
        and
        Phoenix Mines and adjoining areas; (ii) the Project Acquisition Agreement
        between us, Searchlight Exploration, LLC and The McIntyre/Bauman New Jersey
        Trust dated as of October 31, 2004; and (iii) the Bonanza Gold Project
        Acquisition Agreement between us and Searchlight Exploration, LLC dated as
        of
        March 14, 2005.
 
 In
        order
        to induce GCA Fund to execute the Agreement, GCA Fund required security in
        addition to the security offered by us under the Security Agreement. Therefore,
        Oro Blanco, LLC, a Nevada limited liability company, Scott Goldstein, an
        individual, and Stealth Enterprises Inc., an Illinois corporation, executed
        a
        Pledge Agreement in favor of GCA Fund, pledging the mineral rights they own
        in
        the Yellow Jacket and Phoenix Gold Mines to further secure our payment under
        the
        Notes. In exchange for these parties executing the Pledge Agreement, we executed
        a Security Agreement with Oro Blanco, LLC, dated May 6, 2005, wherein we
        granted
        Oro Blanco, LLC, a first lien and security interest in all our equipment,
        including our mining equipment, all our vehicles, any property purchased
        with
        the GCA Fund financing, and any other personal property we own that is located
        at the Yellow Jacket and Phoenix Mines, up to a total of
        $1,750,000.
 
 Pursuant
        to the terms of a Registration Rights Agreement dated May 9, 2005, we agreed
        to
        file a registration statement with the Securities and Exchange Commission
        within
        45 days (June 23, 2005) from the date of the Agreement covering the resale
        of
        any common stock acquired by (or potentially acquirable by) GCA Fund upon
        the
        conversion of the Notes, or exercise of the Common Stock Purchase Warrants,
        with
        a goal of having the registration statement declared effective on a date
        no
        longer than ninety days from the date of the Agreement (August 8, 2005).
 
 Pursuant
        to the Registration Rights Agreement, on July 5, 2005, we filed a Registration
        Statement on Form SB-2 to register an indeterminate number of shares of our
        common stock issuable upon conversion of the secured convertible note and
        exercise of the warrants held by GCA. On July 29, 2005, we received the first
        set of comments to our Registration Statement from the Securities and Exchange
        Commission and we are in the process of responding to those comments. Our
        response to those comments was delayed due to the situation with our
        independents auditors, which is discussed below.
 
 Independent
        Auditors
 
 On
        August
        5, 2005, Dohan and Company, CPA's, P.A., the independent accountants previously
        engaged as the principal accountants to audit our financial statements, were
        dismissed. The decision to change accountants was approved by the Board of
        Directors.
 
 On
        September 13, 2005, we decided to re-engage the services of Dohan and Company,
        CPA’s, P.A. for the limited purpose of reviewing our financial statements for
        this Quarterly Report on Form 10-QSB, reviewing and assisting us with our
        response to the comments on, and the filing of, our amended Registration
        Statement, and reviewing and assisting us with filing any amended Exchange
        Act
        periodic filings that may need to be filed based on the comments from the
        Securities and Exchange Commission on our Registration Statement.
 
 22
 Amended
        Exchange Act Filings
 
 As
        noted
        above, on July 29, 2005, we received comments from the Securities and Exchange
        Commission regarding our Registration Statement on Form SB-2. As part of
        those
        comments the Securities and Exchange Commission has requested that we file
        amended Exchange Act filings to make changes consistent with any we make
        to our
        amended Registration Statement. As explained above, we have not completed
        our
        responses to the Securities and Exchange Commission’s comments and, therefore,
        do not know exactly what changes will be necessary to our Registration Statement
        and what amended Exchange Act periodic filings will need to filed with parallel
        changes. However, we do anticipate we will file amendments to some of our
        recent
        periodic filings.
 
 Glossary
        of Terms
 
 A
        glossary of the mining and mineral resource terms used in this Report are
        attached as an Exhibit to our Annual Report on Form 10-KSB for the year ended
        December 31, 2004.
 
 Statement
        Concerning International Risks
 
 We
        operate in developing markets, which may subject us to volatile conditions
        not
        present in the United States. Our business and performance could be negatively
        affected by a variety of factors and conditions that businesses operating
        in the
        United States generally do not contend with, such as:
 
 •
              foreign
                  currency exchange fluctuations and instability of foreign
                  currencies;
 
 •
              varying
                  foreign governmental regulations and regulatory authority
                  requirements;
 
 •
              political
                  or economic instability and volatility in particular countries
                  or
                  regions;
 
 •
              limited
                  protection for intellectual
                  property;
 
 •
              difficulties
                  in staffing and managing international operations;
                  and
 
 •
              difficulties
                  in collecting accounts receivable.
 
 Our
        business could be exposed to risks due to civil and political unrest in third
        world countries such as Peru. If civil and political conditions worsen, or
        if
        instability develops in other countries within our geographic focus, our
        operations and financial condition could be negatively affected. In addition,
        we
        may be exposed to, and our business may be negatively affected by, foreign
        currency fluctuations. If we are not successful in managing these risks,
        our
        business and financial condition could be seriously harmed.
  23
  **ITEM
        6**  **Exhibits**
 
 (a) Exhibits
 2.1
                    (3)
                
                Agreement
                    and Plan of Reorganization dated as of April 16, 2004 between
                    the Company
                    and Yellow Jacket Finance Limited3.1
                    (1)
                
                Articles
                    of Incorporation of HeavenExpress.com Inc.3.2
                    (2)
                
                Certificate
                    of Amendment to the Articles of Incorporation of HeavenExpress.com
                    Inc.
                    filed March 4, 20023.3
                    (5)
                
                Articles
                    of Amendment to the Articles of Incorporation of HeavenExpress.com,
                    Inc.
                    filed September 3, 20033.4
                    (5)
                
                Articles
                    of Amendment to the Articles of Incorporation of HeavenExpress.com,
                    Inc.
                    filed April 7, 20043.5
                    (1)
                
                Bylaws
                    of HeavenExpress.com Inc.4.1
                    (5)
                
                Articles
                    of Amendment to Articles of Incorporation of Golden Sand Eco-Protection,
                    Inc. creating Series A Convertible Preferred Stock4.2
                    (4)
                
                2004
                    Equity Compensation Plan10.1
                    (6)
                
                Securities
                    Purchase Agreement with GCA Strategic Investment Fund Limited
                    dated May 9,
                    200510.2
                    (6)
                
                Form
                    of Convertible Secured Promissory Note to GCA Strategic Investment
                    Fund
                    Limited10.3
                    (6)
                
                Form
                    of Common Stock Purchase Warrant issued to GCA Strategic Investment
                    Fund
                    Limited10.4
                    (6)
                
                Security
                    Agreement with GCA Strategic Investment Fund Limited dated May
                    9,
                    200510.5
                    (6)
                
                Registration
                    Rights Agreement with GCA Strategic Investment Fund Limited dated
                    May 9,
                    200510.6
                    (6)
                
                Escrow
                    Agreement with GCA Strategic Investment Fund Limited dated May
                    9,
                    200510.7
                    (6)
                
                Pledge
                    Agreement with Scott Goldstein, Stealth Enterprises, Inc., Oro
                    Blanco,
                    LLC, GCA Strategic Investment Fund Limited dated May 6,
                    200510.8
                    (6)
                
                Security
                    Agreement with Oro Blanco Mining, LLC dated May 6, 2005
   24
  31.1
                
                Rule
                    13a-14(a)/15d-14(a) Certification of Chief Executive
                    Officer31.2
                
                Rule
                    13a-14(a)/15d-14(a) Certification of Chief Financial
                    Officer32.1
                
                Chief
                    Executive Officer Certification Pursuant to 18 USC, Section 1350,
                    as
                    Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
                    2002.32.2
                
                Chief
                    Financial Officer Certification Pursuant to 18 USC, Section 1350,
                    as
                    Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
                    2002.99.1
                    (7)
                
                Glossary
                    of Terms Regarding Mineral Resources and
                    Reserves
 
 (1)
              Incorporated
                  by reference from our Registration Statement on Form SB-2 dated
                  January
                  24, 2000 and filed with the Commission on January 27,
                  2000.
 
 (2)
              Incorporated
                  by reference from our Current Report on Form 8-K dated and filed
                  with the
                  Commission on February 22, 2002.
 
 (3)
              Incorporated
                  by reference from our Current Report on Form 8-K dated April 22,
                  2004 and
                  filed with the Commission on April 26,
                  2004.
 
 (4)
              Incorporated
                  by reference from our Registration Statement on Form S-8 dated
                  April 21,
                  2004 and filed with the Commission on April 26,
                  2004.
 
 (5)
              Incorporated
                  by reference from our Quarterly Report on Form 10-QSB for the quarter
                  ended June 30, 2004, dated August 12, 2004 and filed with the Commission
                  on August 16, 2004.
 
 (6)
              Incorporated
                  by reference from our Current Report on Form 8-K dated May 13,
                  2005 and
                  filed with the Commission on May 16,
                  2005.
 
 (7)
              Incorporated
                  by reference from our Annual Report on Form 10-KSB for the year
                  ended
                  December 31, 2004, dated May 5, 2005 and filed with the Commission
                  on May
                  9, 2005.
 
 
  25
  **SIGNATURES**
 
 In
        accordance with the requirements of the Exchange Act, the registrant caused
        this
        report to be signed on its behalf by the undersigned, thereunto duly
        authorized.
 
 
 **Galaxy
                  Minerals, Inc.**(Registrant)Dated:
                  September 19, 2005
              /s/
                  Matthew J. SymondsMatthew
                  J. Symonds, President, Chief Financial Officer, and
                  Secretary
   26