The following discussion should be read in conjunction with the Financial Statements of the Company and notes thereto included elsewhere in this Annual Report. See "Consolidated Financial Statements and Supplementary Data."
Cautionary Notice Regarding Forward Looking Statements
Readers are cautioned that the following discussion contains certain forward-looking statements and should be read in conjunction with the "Special Note Regarding Forward-Looking Statements" appearing at the beginning of this Annual Report.
The information contained in Item 7 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this report. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.
We desire to take advantage of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. This filing contains a number of forward-looking statements, which reflect management's current views and expectations with respect to our business, strategies, products, future results and events, and financial performance. All statements made in this filing other than statements of historical fact, including statements addressing operating performance, events, or developments which management expects or anticipates will or may occur in the future, including statements related to distributor channels, volume growth, revenues, profitability, new products, adequacy of funds from operations, statements expressing general optimism about future operating results, and non-historical information, are forward looking statements. In particular, the words "believe," "expect," "intend," "anticipate," "estimate," "may," variations of such words, and similar expressions identify forward-looking statements, but are not the exclusive means of identifying such statements, and their absence does not mean that the statement is not forward-looking. These forward-looking statements are subject to certain risks and uncertainties, including those discussed below. Our actual results, performance or achievements could differ materially from historical results as well as those expressed in, anticipated, or implied by these forward-looking statements. We do not undertake any obligation to revise these forward-looking statements to reflect any future events or circumstances.
Readers should not place undue reliance on these forward-looking statements, which are based on management's current expectations and projections about future events, are not guarantees of future performance, are subject to risks, uncertainties and assumptions (including those described below), and apply only as of the date of this filing. Our actual results, performance or achievements could differ materially from the results expressed in, or implied by, these forward-looking statements. Factors which could cause or contribute to such differences include, but are not limited to, the risks to be discussed in our Annual Report on form 10-K and in the press releases and other communications to shareholders issued by us from time to time which attempt to advise interested parties of the risks and factors which may affect our business. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
Water Pollution Control Permit
Through the Company's subsidiaries, a Water Pollution Control Permit ("WPCP")
Application will need to be filed with the
11
The WPCP must be approved prior to commencing the planned construction of our
processing plant in
In connection with the WPCP application, NDEP suggested that we take the following actions: (i) retain a Nevada Certified Environmental Manager ("CEM"), (ii) perform Meteoric Profile II water testing on ground water directly below the mill as well as surrounding wells located off site, and (iii) determine baseline values of water using the Meteoric Profile II results. NDEP regulations require that the Company delay any new construction planned for "metal extraction" until after the permits are in place.
Advanced Surveying & Professional Services, a Professional Land Surveyor
("PLS"), completed surveys and testing of the
Site Preparation
We have completed the initial grading of specific designated areas on the 40 undisturbed acres of land including clearing all vegetation, removing of all scrap metal, and the excavation of the building pad for the preparation of the new 21,875 square foot processing plant and have completed the removal of all the extra and unnecessary materials and old equipment that have accumulated on the land. We refurbished a trailer that will act as our construction office.
Business Plan
The Company is re-examining its next steps for developing a processing facility.
In an effort to move the Company's business plan forward, Management may
evaluate opportunities to acquire, license or joint venture with other parties,
which may include related parties, involved in toll milling, processing, or
mining related activities, The Company is re-examining its next steps for
developing a processing facility. In an effort to move the Company's business
plan forward, Management may evaluate opportunities to acquire, license or joint
venture with other parties, which may include related parties, involved in toll
milling, processing, or mining related activities, which may include
On
Reverse Stock Split
Effective
Results of Operations
Comparison of the Years Ended
12 Revenues
We had no revenues from any operations for the years ended
General and Administrative Expenses
General and administrative expenses were
Other Income and Expenses
Each year we receive monthly payments of
Interest expense for the year ended
Liquidity and Capital Resources
Liquidity is a measure of an entity's ability to secure enough cash to meet its
contractual and operating needs as they arise. We have funded our operations and
satisfied our capital requirements principally through increases in our LOC with
GPR. We do not anticipate generating sufficient positive cash flows from our
operations to fund the next 12 months. We had a working capital deficit of
Our cash reserves will not be adequate to meet our operational needs and thus,
we need to raise additional capital to pay for our operational expenses and
provide for capital expenditures. Our basic operational expenses are currently
estimated at approximately
Recent Financings
During the year ended
During the year ended
Included in the foregoing year-end balances was a pre-existing convertible note
in default held by a non-affiliate third party with a principal balance of
13 Going Concern
The consolidated financial statements contained in this annual report on Form
10-K have been prepared assuming that the Company will continue as a going
concern. The Company has accumulated losses from inception through the period
ended
The consolidated financial statements do not include any adjustments that may be necessary should the Company be unable to continue as a going concern. The Company's continuation as a going concern is dependent on its ability to obtain additional financing as may be required and ultimately to attain profitability. If the Company raises additional funds through the issuance of equity, the percentage ownership of current shareholders could be reduced, and such securities might have rights, preferences or privileges senior to the rights, preferences and privileges of the Company's common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, the Company may not be able to take advantage of prospective business endeavours or opportunities, which could significantly and materially restrict its future plans for developing its business and achieving commercial revenues. If the Company is unable to obtain the necessary capital, the Company may have to cease operations.
Working Capital Deficiency December 31, December 31, 2021 2020 Current assets$ 2,363 $ 36,646 Current liabilities 11,299,771 10,206,600 Working capital deficiency$ (11,297,408 ) $ (10,169,954 )
Current assets remained stable between periods. The increase in current
liabilities is primarily due to an increase in accrued interest relating to the
Company's convertible debentures and notes payable, as well as the increase of
convertible debt balances as a result of increasing advances from related party,
Cash Flows Years EndedDecember 31, 2021 2020
Net cash provided by (used in) operating activities
- - Net cash provided by financing activities - 11,500 Increase (decrease) in cash$ 1,164 $ (746 ) Operating Activities
Net cash provided by operating activities was
Net cash used by operating activities was
14 Investing Activities
For the year ended
Financing Activities
The Company's financing during 2021 was from advances from a related party
totaling
Off-Balance Sheet Arrangements
During the year ended
Effects of Inflation
We do not believe that inflation has had a material impact on our business, revenues or operating results during the periods presented.
Critical Accounting Policies and Estimates
Our significant accounting policies are more fully described in the notes to our
audited consolidated financial statements included in our Annual Report on Form
10-K for the year ended
Impairment of Long-lived Assets
We are reviewing the property and equipment, intangible assets subject to
amortization and other long-lived assets for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset class may
not be recoverable. Indicators of potential impairment include: an adverse
change in legal factors or in the business climate that could affect the value
of the asset; an adverse change in the extent or manner in which the asset is
used or is expected to be used, or in its physical condition; and current or
forecasted operating or cash flow losses that demonstrate continuing losses
associated with the use of the asset. If indicators of impairment are present,
the asset is tested for recoverability by comparing the carrying value of the
asset to the related estimated undiscounted future cash flows expected to be
derived from the asset. If the expected cash flows are less than the carrying
value of the asset, then the asset is considered to be impaired and its carrying
value is written down to fair value, based on the related estimated discounted
cash flows. There were no impairment charges in the year ended
Income Taxes
Income taxes are accounted for based upon an asset and liability approach. Accordingly, deferred tax assets and liabilities arise from the difference between the tax basis of an asset or liability and its reported amount in the financial statements. Deferred tax amounts are determined using the tax rates expected to be in effect when the taxes will actually be paid or refunds received, as provided under currently enacted tax law. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Income tax expense or benefit is the tax payable or refundable, respectively, for the period plus or minus the change in deferred tax assets and liabilities during the period.
Accounting guidance requires the recognition of a financial statement benefit of
a tax position only after determining that the relevant tax authority would more
likely than not sustain the position following an audit. For tax positions
meeting the more-likely-than-not threshold, the amount recognized in the
financial statements is the largest benefit that has a greater than fifty
percent likelihood of being realized upon ultimate settlement with the relevant
tax authority. The Company believes its income tax filing positions and
deductions will be sustained upon examination and accordingly, no reserves, or
related accruals for interest and penalties have been recorded at
15
On
Recent Accounting Standards
During the year ended
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