Forward Looking Statements
This section should be read together with the consolidated financial statements
and related notes thereto, for the year ended
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, for which the Private Securities Litigation Reform Act of 1995 provides a safe harbor. These forward-looking statements include, but are not limited to, statements about our plans, objectives, representations and intentions and are not historical facts and typically are identified by use of terms such as "believes," "expects," "anticipates," "estimates," "plans," "intends," "objectives," "goals," "aims," "projects," "forecasts," "possible," "seeks," "may," "could," "should," "might," "likely," "enable," or similar words or expressions, as well as statements containing phrases such as "in our view," "there can be no assurance," "although no assurance can be given," or "there is no way to anticipate with certainty." These statements include, among other things, statements regarding our ability to implement our business plan and business strategy, our ability to obtain financing to sustain the Company, our ability to finance any future development, construction or operations, our ability to attract key personnel, and our ability to operate profitably in the future. These forward-looking statements are based on current expectations and assumptions that are subject to substantial risks and uncertainties which could cause our actual results to differ materially from those reflected in the forward-looking statements. In evaluating these forward-looking statements, you should consider risks and uncertainties relating to various factors, including, but not limited to, financing, licensing, construction and development, competition, legal actions, federal, state, county and/or city government actions, general financing conditions, and general economic conditions.
The Company's actual results may differ significantly from results projected in the forward-looking statements. We undertake no obligation to revise or update forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.
Throughout this Annual Report references to "we," "our," "us," "
The Company's current priority is the development of a casino resort on its
Property located in
16 Liquidity
The Company has incurred continued losses over the years and certain conditions
raise substantial doubt about the Company's ability to continue as a going
concern. The Company has had no operations since it ended its gambling cruise
ship operations in 2000. Since that time, the Company had concentrated its
efforts on the development of its
In addition, a Line of Credit in the amount of
Management of the Company believes it will be difficult to secure suitable
financing that would allow it to continue to pursue ultimate development of the
Property. Therefore, on
The above conditions raise substantial doubt about the Company's ability to continue as a going concern, and its ability to generate cash to meet its cash requirements for the following twelve months as of the date of this form 10-Q.
Financial Results and Analysis
During the nine months ended
Administrative and general expenses incurred totaled
DESCRIPTION September 30, 2019 September 30, 2018 Payroll and Related Taxes $ 225,000 $ 225,000 Director Fees 67,500 62,500 Professional Services 113,373 66,518 Rents and Insurances 57,377 57,262 Fines and Penalties 45,404 19,550 All Other Expenses 14,920 18,114 Total General and Administrative Expenses $ 523,574 $ 448,944 Other Income and Expense
Interest expense incurred totaled
In the first quarter of 2019, the Company received
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Off-Balance Sheet Arrangements
Management Agreement
On
Brokerage Agreement
On
There are no other off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, changes in financial condition, revenues and expenses, results of operations, liquidity, capital expenditures, or capital resources, that are material to our stockholders.
Critical Accounting Policies Estimates
The preparation of unaudited condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
18 Long-Lived Assets
The Company reviews long-lived assets whenever events or changes in
circumstances indicate that the carrying value of an asset may not be
recoverable. Recoverability of long-lived assets is measured by comparing the
carrying amount of the assets to the estimated undiscounted future cash flows
projected to be generated by the assets. If such assets are considered impaired,
the impairment to be recognized is measured by the amount the carrying value
exceeds the fair value of such assets determined by appraisal, discounted cash
flow projections, or other means. No impairment existed at
Fair Value Measurements
The Company follows the provisions of ASC Topic 820 "Fair Value Measurements" for financial assets and liabilities. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. The standard discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The standard utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:
Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Input other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.
Level 3: Unobservable input that reflects management's own assumptions.
The fair value measurement of the derivative indemnification liability at
Stock-Based Compensation Expense
In determining the fair value of options and warrants granted or modified, the Company uses the Black-Scholes option-pricing model, consistent with the provisions of ASC Topic 718. Valuations are determined using the weighted-average assumptions of dividend yield, expected volatility and risk-free interest rates.
Option valuation models require the input of highly subjective assumptions, including the expected stock price volatility. The Company uses projected volatility rates, which are based upon historical volatility rates, trended into future years. Because the Company's employee stock options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do not necessarily provide a reliable single measure of the fair value of the Company's options.
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