Forward-Looking Statements
Except for historical information, this report contains certain forward-looking
statements. Such forward-looking statements involve risks and uncertainties,
including, among other things, statements regarding our business strategy,
future revenues and anticipated costs and expenses. Such forward-looking
statements include, among others, those statements including the words
"expects," "anticipates," "intends," "believes" and similar language. Our actual
results may differ significantly from those projected in the forward-looking
statements. Factors that might cause or contribute to such differences include,
but are not limited to, those discussed herein as well as in the "Current
Business" and "Risk Factors" sections in our 10-K for the year ended July 31,
2019, as filed on February 24, 2020. You should carefully review the risks
described in our documents we file from time to time with the Securities and
Exchange Commission ("SEC"). You are cautioned not to place undue reliance on
the forward-looking statements, which speak only as of the date of this report.
We undertake no obligation to publicly release any revisions to the
forward-looking statements or reflect events or circumstances after the date of
this document.
Although we believe that the expectations reflected in these forward-looking
statements are based on reasonable assumptions, there are a number of risks and
uncertainties that could cause actual results to differ materially from such
forward-looking statements.
All references in this Form 10-Q to the "Company," "Mirage Energy," "we," "us,"
or "our" are to Mirage Energy Corporation (formerly Bridgewater Platforms Inc.)
Corporate Overview
Company's Plans
The Company has proposed to develop an integrated natural gas pipeline system in
Texas and Mexico. The purpose of these pipelines will transport and store
natural gas in an underground natural gas storage facility, which the Company
proposes to permit and develop in northern Mexico. The Company believes that it
has made substantial progress toward these goals with its preliminary project
engineering designs and high-level meetings with representatives of various
Mexican regulatory agencies.
On June 11, 2020, the Company received a financing Term Sheet from Bluebell
International, LLC (BBI) for $4 Billion plus an interest reserve and payment of
Closing Costs. The equity would split with Mirage owning 25% after closing.
Mirage would have no payment obligation regarding any of the $4 Billion loan.
Mirage would be responsible for construction and after construction management.
The Projects which will be initially developed include:
· Mirage 1 - Burgos Hub Storage & Gas Pipeline (natural gas)
"Brasil Field" is the gas storage facility
"Concho Line" "Progreso Line" "Progreso Crossing" "Storage Line" (pipeline
running from Corpus Christi, TX to the Brasil Field storage facility)
· Mirage 2 - 48-inch Pipeline Rehabilitation (natural gas)
Pipeline running from Reynosa, Mexico to Nuevo
· Mirage 3 - 30-inch and 48-inch Pipeline Rehabilitation (crude oil)
Bi-directional transport of crude oil across the Tehuantepec Isthmus of
MexicoBBI is completing its Due Diligence activities prior to a Final Closing.
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Discussion and Analysis of Financial Condition and Results of Operations
Revenues
Three month period ended January 31, 2020
For the three (3) month period ended January 31, 2020, we generated no revenue
and incurred a net loss of $767,039.
Our net loss of $767,039 for the three (3) month period ended January 31, 2020
was the result of operating expenses of $238,538 and other expense (comprised of
interest expense and change in fair value of convertible debt) of $528,501. Our
operating expenses consisted of $222,983 in general and administrative expenses,
and $15,555 in professional fees.
Three month period ended January 31, 2019
For the three (3) month period ended January 31, 2019, we generated no revenue
and incurred a net loss of $2,359,855.
Our net loss of $2,359,855 for the three (3) month period ended January 31, 2020
was the result of operating expenses of $237,391 and other expense (comprised of
interest expense and change in fair value of convertible debt) of $2,122,464.
Our operating expenses consisted of $222,004 in general and administrative
expenses, and $15,387 in professional fees.
Costs and Expenses
Our primary costs going forward are related to travel, professional fees, legal
fees, financing fees and salaries and related payroll taxes associated with our
proposed pipeline and natural gas storage activities in Mexico.
Three month period ended January 31, 2020 and 2019
For the three (3) months ended January 31, 2020, we had $222,983 in general and
administrative expenses compared to $222,004 in general and administrative
expenses for the three (3) months ended January 31, 2019. The $979 increase in
general and administrative expenses was primarily the result of spending
increase in travel and entertainment and spending decrease in financing fees and
executive compensation during the three (3) months ended January 31, 2020.
The professional fees for the three (3) months ending January 31, 2020 and
January 31, 2019 were $15,555 and $15,387, respectively. The $168 increase was
primarily related to same spending for legal, audit and transfer agent fees.
The executive compensation for the three (3) months ending January 31, 2020 and
January 31, 2019 was $92,000 and $116,500 respectively. The difference was due
to a decrease in salaries because one executive left as of the year ended July
31, 2019.
Six month period ended January 31, 2020 and 2019
For the six (6) months ended January 31, 2020, we had $485,958 in general and
administrative expenses compared to $434,681 in general and administrative
expenses for the six (6) months ended January 31, 2019. The $51,277 increase in
general and administrative expenses was primarily the result of spending
increase in travel and entertainment, an increase in financing fees, an increase
in consulting fees and a decrease in executive compensation during the six (6)
months ended January 31, 2020.
The professional fees for the six (6) months ending January 31, 2020 and January
31, 2019 were $55,846 and $54,690, respectively. The $1,156 increase was
primarily related to a spending increase for audit fees, a decrease in legal
fees, a decrease in tax preparation fees and an increase in transfer agent fees.
The executive compensation for the six (6) months ending January 31, 2020 and
January 31, 2019 was $274,000 and $323,00 respectively. The difference was due
to a decrease in salaries because one executive left as of the year ended July
31, 2019.
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Liquidity and Capital Resources
Cash Flows
Operating Activities
For the six (6) month period ended January 31, 2020, net cash used in operating
activities was $474,340. The negative cash flow for the six (6) months ended
January 31, 2020 related to our net loss of $1,194,196, an decrease in prepaid
expenses of $107, an increase of expenses paid by shareholder of $16,611,
adjusted for $34,298 in financing fees, adjusted for depreciation of $791, a
change of $609,347 in convertible debt due to fair market value, an increase of
$110,657 in accounts payable, an increase of $5,250 in accrued expenses and an
decrease of $56,991 in accrued salaries and payroll taxes - related parties.
For the six (6) month period ended January 31, 2019, net cash used in operating
activities was $78,656. The negative cash flow for the six (6) months ended
January 31, 2019 related to our net loss of $2,766,750, an increase in prepaid
expenses of $289, an increase of expenses paid by shareholder of $8,815, an
increase of $267,250 in convertible debt due to default, adjusted for $16,500 in
financing fees, adjusted for depreciation of $790, a change of $1,976,755 in
convertible debt due to fair market value, an increase of $159,061 in accounts
payable, an increase of $2,580 in accrued expenses and an increase of $256,054
in accrued salaries and payroll taxes - related parties.
Investing Activities
For the six (6) months ended January 31, 2020 net cash used in investing
activities was nil.
For the six (6) months ended January 31, 2019 net cash used in investing
activities was nil.
Financing Activities
For the six (6) months ended January 31, 2020, net cash provided from financing
activities was $507,889. The positive cash flow from financing activities for
such period was comprised of proceeds from sale of common stock, proceeds from
loan by related party and proceeds from convertible debentures.
For the six (6) months ended January 31, 2019, net cash provided from financing
activities was $131,977. The positive cash flow from financing activities for
such period was comprised of proceeds from sale of common stock and proceeds
from convertible debentures.
Liquidity
To date, we have funded our operations primarily with capital provided and loans
provided by related parties, accruing of salaries and accounts payable, sales of
common stock and convertible debentures. We do not currently have commitments
regarding fixed costs.
As of January 31, 2020, Mirage Energy Corporation had $104,005 in cash on hand
and prepaid expenses of $1,867. Since Mirage Energy Corporation was unable to
reasonably project its future revenue, it must presume that it will not generate
any revenue during the next twelve (12) to twenty-four (24) months. We therefore
will need to obtain additional debt or equity funding in the next two (2) -
three (3) months, but there can be no assurances that such funding will be
available to us in sufficient amounts or on reasonable terms.
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The Company's audited financial statements for the year ended July 31, 2019
contain a "going concern" qualification. As discussed in Note 3 of the Notes to
Financial Statements, the Company has incurred losses and has not demonstrated
the ability to generate cash flows from operations to satisfy its liabilities
and sustain operations. Because of these conditions, our independent auditors
have raised substantial doubt about our ability to continue as a going concern.
Our financial objective is to make sure the Company has the cash and debt
capacity to fund on-going operating activities, investments and growth. We
intend to fund future capital needs through our current cash position,
additional credit facilities, future operating cash flow and debt or equity
financing. We are continually evaluating these options to make sure we have
capital resources to meet our needs.
Existing capital resources are insufficient to support continuing operations of
the Company over the next 12 months.
Management makes no assurances that adequate capital resources will be available
to support continuing operations over the next 12 months. Management plans to
pursue additional capital funding through multiple sources.
For the year ended July 31, 2019, the Company has funded operations with debt of
$329,500 from convertible notes, proceeds from sale of $325,978 in common stock,
while making loan repayments of $180,003 to related party and $83,250 to
convertible notes. The Company plans to raise additional funds through various
sources to support ongoing operations during 2019 and 2020.
While no assurances can be given regarding the achievement of future results as
actual results may differ materially, management anticipates adequate capital
resources to support continuing operations over the next 12 months through the
combination of infused capital through exercised warrants, infused capital
through non-public private placement and existing cash reserves.
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MIRAGE ENERGY CORPORATION 