A quick #guide on how to avoid dilutive #pennystock companies.

From the perspective of a “long” position into this company, I’ve highlighted “red flags.”  The share structure as seen above, authorized shares and outstanding shares are very important to review.  In this case, the company has 1,000,000,000 shares authorized and only has 213,676,990 outstanding presently.  However, the company will be allowed to sell common shares, or pay off debts using company shares all the way up to the 1,000,000,000 authorized share amount; this company has a setup to dilute shareholders a lot, this is a major red flag if you’re looking at this company from the “long” side.  You can also use this information and know that if this company were to ever rise up to a share price that would be worth selling short, you would most likely want to short sell a company with such a dilutive share structure.

The company has also done a 1 for 40 reverse stock split, this is also very common practice for dilutive companies to do, which isn’t good for shareholders.

The next thing I will do is review recent SEC filings. Specifically the 10-Q and 10-K.  I https://www.otcmarkets.com/stock/VAPE/filings  I will compare a few 10-Q reports, the current quarter and the previous quarter before this and compare the outstanding share amounts, checking if there is a change in the outstanding share amount.  If the O/S amount is increasing from quarter to quarter, this means the company is potentially paying for services or compensation using common shares or warrants, etc.  I will search muse through the filings, looking for dilution warning signals such as “options” “warrants” “convertibles” “promissory notes” debt, is the company paying for services using common shares and/or convertible debentures – this is terrible for shareholders in the long run.  You’ll want to avoid these types of companies from the “long” side (but great for short side if the price is high enough).

For example:  For the quarterly period ended March 31, 2016, there was 366,873,168 outstanding shares. https://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=11407795

For the quarterly period ended June 30, 2016, there was 657,936,872 outstanding shares.https://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=12019939

So in the 3 month period the company issued 291,063,704 additional shares! HUGE RED FLAG

If you search those above 10-Q reports for the other dilution warning keywords that I mentioned earlier, you will see that VAPE has a lot of convertible notes payable, this will really hurt shareholders in the long run, you pretty much want to avoid companies like this from the long side, it’s like playing with fire, you’re going to get burned eventually.

$GREI From 8 employees down to 1 and other concerning items from the most recent 10-K.

The following excerpts are sourced from $GREI most recent 10-K SEC filing.

NOTE 3. GOING CONCERN – The Company is still in development stage and has not created sufficient revenue to cover any operating losses it may incur. Management’s plans include the raising of capital through the equity markets to fund future operations, seeking additional acquisitions, and generating of revenue through our business. However, there can be no assurances the Company will be successful in its efforts to secure additional equity financing and obtaining sufficient revenue producing contracts. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

GREI-buyer-beware-OTCmarkets

As of March 30 , 2017, there were 126,740,708 shares of common stock, par value $.0001, outstanding.  With the last close price at $8.25, this makes the market cap $1,045,610,841 (1 billion dollars)

Above is GREI 1-year-daily-chart, 04-18-2017.

Our other administrative expenses for the year will consist primarily of transfer agent fees, bank and interest charges and general office expenses. The professional fees are related to our regulatory filings throughout the year and include legal, accounting and auditing fees. The equipment purchases and plant set-up are related to the materially definitive agreement with Jiangnan.

Based on our planned expenditures, we will require approximately $5,000,000 to proceed with our business plan over the next twelve months. If we secure less than the full amount of financing that we require, we will not be able to carry out our complete business plan and we will be forced to proceed with a scaled back business plan based on our available financial resources.

We intend to raise the balance of our cash requirements for the next twelve months pursuant to our agreement with Jiangnan by accessing upon request bank loans, bank guarantees and equity funding. Additionally, we may have private placements, shareholder loans or possibly a registered public offering (either self-underwritten or through a broker-dealer). If we are unsuccessful in raising enough money through such efforts, we may review other financing possibilities such as bank loans. At this time, other than our agreement with Jiangnan we do not have a commitment from any third-party to provide us with financing. There is no assurance that any financing will be available to us or if available, on terms that will be acceptable to us.

Even though we plan to raise capital through equity or debt financing, we believe that the latter may not be a viable alternative for funding our operations, as we do not have sufficient tangible assets to secure any such financing. We anticipate that any additional funding will be in the form of equity financing from the sale of our common stock. At the close of 2016, we are considering financing arrangements for our common stock. However, the arrangements are not final and we cannot provide any assurance that we will be able to raise sufficient funds from the sale of our common stock to finance our operations. In the absence of such financing, we may be forced to abandon our business plan.

On December 31, 2016, management conducted an evaluation of the effectiveness of our internal control over financial reporting and found it to be not effective subsequent to filing our Annual Report on Form 10-K for the year ended December 31, 2016 with the Commission. Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Management has concluded that the Company’s internal controls over financial reporting are not effective. The material weaknesses identified relate to the lack of proper segregation of duties and the lack of sufficient qualified accounting and other finance personnel with an appropriate level of U.S. GAAP knowledge and experience. As we obtain additional funding and employ additional personnel, we will implement programs recommended by the Treadway Commission to remediate the material weaknesses.

Item 2. Description of Property.
The Company maintains an office at 4700 Homewood Court, Suite 100 in Raleigh, North Carolina, 27609 as its headquarters. It is currently in the process of scouting and researching locations for a facility in China. The North Carolina office is leased from Yilaime Corporation, a Nevada corporation doing business in North Carolina, and a related party to the Company. The North Carolina office consists of a 1000 square foot office space. It presently houses all eight employees of the Company and is being leased for $2,500 per month from Yilaime. The China location, once established, will serve as a manufacturing location. (Between Feb 13, 2017 to Apr 14 2017, the employee amount has changed from 8 employees to 1 employee.)
http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=11873632
http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=11996256

Securities Authorized for Issuance Under Equity Compensation Plans
The Company agreed to issue Mr. Perkins, or his authorized designee, an option to purchase up to 5,000,000 shares of common stock of the Company per year at any time prior to the conclusion of the first year of the Employment Agreement, i.e. prior to 365 days after execution of the Employment Agreement, at a price of 1.5% per share of the closing price of the Company’s stock quoted on a major exchange or OTC Market one business day before purchase, and annually thereafter for a total of 5 consecutive years. The shares purchased under this option are subject to all rights and lock-up restrictions set forth in the Employment Agreement.

$SPYR stock quote (JOES) Quarterly Chart Data from 2009 to 2016

ZAKENI LIMITED v. SPYR, INC., Dist. Court, D. Delaware 2016

SPYR Inc: 100% Downside, Q3 Fundamentals And New Lawsuit Info Don’t Lie

 Quarter High Low Average
2009 Q1 0.015 0.005 0.01
2009 Q2 0.005 0.005 0.005
2009 Q3 0.015 0.008 0.0115
2009 Q4 0.01 0.01 0.01
2010 Q1 0.01 0.004 0.007
2010 Q2 0.0192 0.0075 0.01335
2010 Q3 0.02 0.005 0.0125
2010 Q4 0.015 0.01 0.0125
2011 Q1 0.014 0.005 0.0095
2011 Q2 0.0144 0.005 0.0097
2011 Q3 0.014 0.01 0.012
2011 Q4 0.014 0.0052 0.0096
2012 Q1 0.01 0.0052 0.0076
2012 Q2 0.01 0.003 0.0065
2012 Q3 0.01 0.0029 0.00645
2012 Q4 0.01 0.0047 0.00735
2013 Q1 0.01 0.01 0.01
2013 Q2 0.04 0.04 0.04
2013 Q3 0.04 0.03 0.035
2013 Q4 0.04 0.03 0.035
2014 Q1 0.35 0.03 0.19
2014 Q2 0.29 0.19 0.24
2014 Q3 0.23 0.13 0.18
2014 Q4 0.3 0.1 0.2
2015 Q1 0.74 0.17 0.455
2015 Q2 0.99 0.36 0.675
2015 Q3 0.57 0.18 0.375
2015 Q4 0.29 0.16 0.225
2016 Q1 0.215 0.13 0.1725
2016 Q2 0.46 0.12 0.29
2016 Q3 0.71 0.22 0.465
2016 Q4 0.67 0.41 0.54

$AEXE excerpts from most recent quarterly report 10-Q.

NOTE 3 – GOING CONCERN

The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has a working capital deficit of $ 2,119,054 , an accumulated deficit of $ 2,675,326 and net loss from operations since inception of $ 2,675,326 . The Company does not have a source of revenue sufficient to cover its operation costs giving substantial doubt for it to continue as a going concern. The Company will be dependent upon the raising of additional capital through placement of our common stock in order to implement its business plan, or merging with an operating company. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern.

The Company is funding its initial operations by way of issuing common shares.

AIM EXPLORATION INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
May 31, 2016 (unaudited)

NOTE 4 – MINERAL PROPERTY (Continued)

Peruvian Mining Claims (Continued):

In consideration for the above concessions, the Company has issued 15,750,000 restricted common shares (Note 6) to Percana in two separate blocks; the first block consists of 6,300,000 common shares which are to be held in escrow until either the Company raises $1,000,000 or when Percana waives this requirement. The second block consists of 9,450,000 shares which are to be held in escrow until such time as the Company is satisfied at its discretion that any arbitration issues have been resolved with the third concession, at which time the shares may be released out of escrow at the option of Percana. These Mining Concessions were acquired based on the assumption the properties are rich in high grade Anthracite Coal, currently there are 20 small tunnels on the property already producing anthracite coal which was being mined by illegal miners. Testing of the coal samples was performed indicating the presence of high-grade anthracite coal. Prior to acquisition AIM reviewed a non-compliant technical report prepared by Engineers/Geologists together with hiring a US based firm Gustavson Associates to visit the property and review the reports. The firm provided AIM with a report, which included recommendation for further exploration.

NOTE 5 – CONVERTIBLE NOTE

During the nine months ended May 31, 2016, the Company issued convertible notes with a principal balance of $215,000, with maturity dates ranging from February 29, 2016 to January 12, 2017, and an interest rate per annum ranging from 10% to 22%. The principal is convertible into common shares of the Company at a conversion rate equal to 50% – 60% of the lowest trading price of the Company’s common stock for the fifteen prior trading days, as defined in the agreements.

During the nine months ended May 31, 2016, 355,039 common shares were issued in relation to conversion options exercised during the period. Of these common shares, $117,449 related to principal of the convertible notes, $7,895 to accrued interest, and $11,100 to fees.

During the year ended August 31, 2015, the Company issued convertible notes with a principal balance of $306,875, with maturity dates ranging from November 6, 2015 to July 22, 2016, and an interest rate per annum ranging from 8% to 12%. The principal is convertible into common shares of the Company at a conversion rate equal to 55% – 60% of the lowest trading price of the Company’s common stock for the fifteen prior trading days, as defined in the agreements.

The Company is accounting for the conversion feature as a separate derivative liability under ASC 815. As such, the Company will carry the conversion feature liability at fair value on the balance sheet. The Company determined the fair value of the conversion feature as at the dates of issue and also as of the period ended May 31, 2016. To determine the put and call values, the Company used the Black-Scholes option valuation model using the following inputs:

May 31, 2016
August 31, 2015
Fair value of common stock
$0.08
$0.21 – $0.42
Exercise price
$0.04
$0.1350 – $0.2585
Contractual term
0.10 year – 0.62 year
9 months – 1 year
Volatility
682.3%
119.50% – 143.10%
Risk-free interest rate
0.68%
0.12% – 0.41%

F-9

AIM EXPLORATION INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
May 31, 2016 (unaudited)

NOTE 5 – CONVERTIBLE NOTE (CONTINUED)

Volatility was determined using a peer group of public companies, and the Company used US treasuries with a similar contractual term to determine the risk-free interest rate.

On May 11, 2015, the Company exercised its option to redeem convertible notes with a principal balance of $47,250 within 180 days of their issuance, by opting to prepay the note at 150% of the principal amount plus accrued interest in the amount of $1,853. The Company recorded a loss on the repurchase of the convertible note in the amount of $20,664, which was credited to the additional paid in capital account.

During the nine months ended May 31, 2016, the Company recognized change in fair value of the derivative liability of $187,908 related to the change in fair value of the conversion feature. The change in fair value of the conversion feature was recorded through operating results.

When recording the conversion feature liability during the period, the Company recognized a 100% debt discount on the convertible notes payable of $215,000 and finance costs expense of $172,601 from amortization of debt discounts and excess of derivative liability over the face value of the note. The debt discount is being accreted to finance costs using the straight-line method over the contractual term of the debt. During the period ended May 31, 2016, the Company also recognized in the normal course accretion expense of $452,826.

NOTE 6 – CAPITAL STOCK

On April 25, 2016, the Company consolidated its share capital on a 250:1 basis. All common shares and per share amounts have been restated to reflect this share consolidation.

The Company has authorized 250,000,000 shares of common stock with a par value of $0.001 per share and 1,000,000 shares of preferred stock with a par value of $0.001 per share.

At May 31, 2016, 16,399,876 shares of common stock were issued and outstanding, and 100,000 shares of preferred stock were issued and outstanding.

In July 2014, the Company issued 63,000 common shares in connection with the acquisition of certain mining property to Percana. As a result of the share consolidation on April 25, 2016, the Company issued an additional 15,687,000 common shares to Percana on April 25, 2016, to bring their holdings up to their original position of 15,750,000 common shares. (Note 4)

During the year ended August 31, 2015, the Company issued 20,000 shares to 1 shareholder in connection with an asset acquisition agreement at fair value of $5,000. The Company also issued 1,400 common shares to 1 shareholder in connection with a six-month investor relations campaign at fair value of $175,000.

During the period ended May 31, 2016, the Company issued 355,039 common shares pursuant to the exercise of the option attached to outstanding convertible notes. (Note 5)

During the period ended August 31, 2015, the Company issued 100,000 preferred shares to 1 shareholder at fair value of $18,000, a related party of the Company, in connection with services rendered.

F-10

AIM EXPLORATION INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
May 31, 2016 (unaudited)

NOTE 7 – LOANS PAYABLE – RELATED PARTIES

During the period ended May 31, 2016 and 2015 , advances from a director of the Company were $550 and $Nil, respectively. The amounts are unsecured, non-interest bearing and are due on demand.

During the period ended May 31, 2016 and 2015 , advances from related parties were $49,240 and $166,128, respectively, and amounts advanced to one related party were $121,995 and $25,500, respectively. The amounts are unsecured, non-interest bearing and are due on demand.

During the period ended May 31, 2016 and 2015 , management fees totaling $162,000 and $Nil, respectively, were accrued as payable to two directors of the Company

NOTE 8 – RESTATEMENTS

During the period ended May 31, 2016, accounting errors were discovered that required a restatement of amounts previously reported, related to loan payable that was issued against a finder’s fee incurred. The loan payable was amended, and the terms revised to a convertible note payable. The loan payable and its subsequent amendment to a convertible note payable were not reported during the year ended August 31, 2015. This error resulted in changes to the convertible note, derivative liability, accretion expense, finder’s fee expense, interest expense, finance costs, and the change in fair value of derivative liability. As a result of correcting these errors, our net loss increased by $157,923 for the year ended August 31, 2015, and $18,484 for the three months ended November 30, 2015.

Source: http://bit.ly/2dqUmqy

$GLLK #penny #stock promotion – pump and dump?

GLLK Gold Lakes Corp. (Formerly=Siga Resources, Inc. until 8-2015) says, identifies itself as a company in the exploration stage, which has not generated any revenue and has no prospects of generating any revenue in the foreseeable future 
(see "Trends" in latest 10-Q). A good place to start your research is the company profile on OTCmarkets.com Here I find a quick overview of interesting items such as what the company was formerly (Formerly=Siga Resources, Inc.) and also recent stock splits, authorized shares, outstanding shares, float, etc. 
Then I google "Siga Resources, Inc" and try to find other articles or even previous stock charts of the company to get an idea or history of what the company was before, compared to what it is doing now. It also provides insight if the company is a repeat offender in the penny stock promotion and manipulation pump and dump field.  This company certainly has a well documented history, which will have a very negative effect to long term shareholders.  This article from Sept 21 2013 which states "Siga Resources Inc (SGAE) pump-and-dump spam" is rather interesting!
SGAE-formerly-GLLKIf you look at the GLLK stock chart, it appears to be a classic penny stock promotion, aka "pump and dump."  If you google Siga Resources Inc (OTC:SGAE) you will come across an article from Sept 2011 which also identified this company for running a stock promotion. hotstocked.com also wrote a new article about GLLK on July 1, 2016.

GLLK-1-year-daily-stock-chart-07-19-2016Another value investor on investorshub (iHub) said this on July 15, 2016: GLLK is Hyper Overvalued and Hyper Overbought now! It only worth $0.0005 per share at most! Sell ASAP before it crashes like its peer did... 

Below are some items that I pay attention to when reviewing quarterly financial statements. The company's latest 10-Q, received June 17, 2016 for the period ending April 30, 2016.

Total Assets: $128,456
Total Liabilities: $1,128,772
Total Stockholders' Deficiency $(1,000,316)
Revenues: ZERO
Expenses: ZERO
- It appears as though this company has no operations or ways to create money or value for it's shareholders.

Common stock 500,000,000 shares authorized, at $0.001 par value; 33,135,645 shares issued and outstanding as of April 30, 2016 (July 31, 2015 – 225,645 shares) !!!!!!!!!

The company only had 225,645 shares outstanding at July 31, 2015. And now they have 33.1 Million shares outstanding (which is actually 99 Million shares now since after the 3:1 reverse split on July 15, 2016). This appears to be major dilution to the $GLLK shareholders.

The company pays for services, debt, and property by using common shares, which also further removes real value from it's shareholders.
Shares issued for services $ 280,000
Shares issued for debt $ 4,400,000
Shares issued for property $ 23,500,000

If you read through the company's latest 10-Q,another good search to see the quality of the company is the key word of "convertible."  This will show you how the company likes to operate.  There are 39 mentions of the word convertible in this 10-Q.  Convertibles are very hazardous to a company's financial health.  If you look at LEXG and BTCS you will see what the effects of convertibles due to a stock chart and the value of the stock price.  It essentially sends the stock to zero in a hurry!

GLLK-10Q-convertibleBTCS-daily-chart-07-19-2016-dilutionLEXG-daily-chart-07-19-2016-dilutionBelow are quotes from the latest 10Q that make reference to "convertibles."

On November 20, 2015, the Company issued a $30,000 convertible promissory note. The note has an 8% per annum interest rate and a maturity date of November20, 2016. Closing costs of $3,500 are being amortized over the life of the loan. The note is convertible into shares of common stock of the Company at any time at a rate of 50% of the lowest trading price of the shares over the previous 20-day trading period. A conversion benefit of $30,000 has been recorded and is being
amortized over the life of the loan. A derivative liability has been calculated using Black Sholes and is estimated to be $52,276 at April 30, 2016.

On December 21, 2015, the Company issued a $50,000 convertible promissory note. The note has an 8% per annum interest rate and a maturity date of December
21, 2017. Closing costs of $5,000 are being amortized over the life of the loan. The note is convertible into shares of common stock of the Company at any time at
a rate of 50% of the lowest trading price of the shares over the previous 20-day trading period. A conversion benefit of $50,000 has been recorded and is being
amortized over the life of the loan. A derivative liability has been calculated using Black Sholes and is estimated to be $100,208 at April 30, 2016.

On December 21, 2015, the Company issued a $50,000 convertible promissory note. The note has an 8% per annum interest rate and a maturity date of December
21, 2017. Closing costs of $5,000 are being amortized over the life of the loan. The note is convertible into shares of common stock of the Company at any time at
a rate of 50% of the lowest trading price of the shares over the previous 20-day trading period. A conversion benefit of $50,000 has been recorded and is being
amortized over the life of the loan. A derivative liability has been calculated using Black Sholes and is estimated to be $100,207 at April 30, 2016.

On January 22, 2016, the Company issued a $35,500 convertible promissory note. The note has an 12% per annum interest rate and a maturity date of January 22,
2017. Closing costs of $9,050 are being amortized over the life of the loan. The note is convertible into shares of common stock of the Company at any time at a
rate of 50% of the lowest trading price of the shares over the previous 20-day trading period. A conversion benefit of $35,500 has been recorded and is being
amortized over the life of the loan. A derivative liability has been calculated using Black Sholes and is estimated to be $61,860 at April 30, 2016.

On February 25, 2016, the Company issued a $27,500 convertible promissory note. The note has an 8% per annum interest rate and a maturity date of February 25,
2017. Closing costs of $9,050 are being amortized over the life of the loan. The note is convertible into shares of common stock of the Company at any time at a
rate of 50% of the lowest trading price of the shares over the previous 20-day trading period. A conversion benefit of $27,500 has been recorded and is being
amortized over the life of the loan. A derivative liability has been calculated using Black Sholes and is estimated to be $50,583 at April 30, 2016.
On March 14, 2016, the Company issued a $285,000 convertible promissory note. The note has an 8% per annum interest rate and a maturity date of March 11,
2017. Closing costs of $35,000 are being amortized over the life of the loan. The note is convertible into shares of common stock of the Company at any time at a
rate of 50% of the lowest trading price of the shares over the previous 20-day trading period. A conversion benefit of $285,000 has been recorded and is being
amortized over the life of the loan. A derivative liability has been calculated using Black Sholes and is estimated to be $496,620 at April 30, 2016.

6. RELATED PARTY TRANSACTIONS
During the period, the Company has paid its officer consulting fees of $26,000 (2015 - $nil) and rent of $4,500 (2015 - $nil). On October 15, 2015, the Company
remunerated the officer of the Company 400,000 shares of the Company's common stock. The price of the stock was $0.43 and a charge of $172,000 has been
expensed as Shares for Service.
7. SHARES FOR SERVICE
On November 1, 2015, there was 200,000 shares issued to a consultant. At the issue date, the fair market value of the shares was $0.50 and a charge of $100,000
has been expensed as Shares for Service.
On April 1, 2016, there was 10,000 shares issued to a consultant for services. At the issue date, the fair market value of the shares was $0.80 and a charge of $8,000
has been expensed.
8. NOTE PAYABLE
The Company has received $17,500 under a promissory note agreement with a third party in July 2012. An additional $4,000 was received under this Note in 2014.
Interest and principal were due on September 15, 2012. The Company is currently in default on this Note. Per the note agreement, interest of $11,768 was accrued
through April 30, 2016 and has been disclosed on the balance sheets as accounts payable and accrued interest.
9. GOING CONCERN The Company will need additional working capital to service its debt and to develop the mineral claims acquired, which raises substantial doubt about its ability to
continue as a going concern. Continuation of the Company as a going concern is dependent upon obtaining additional working capital and the management of the
Company has developed a strategy, which it believes will accomplish this objective through additional equity funding, and long term financing, which will enable
the Company to operate for the coming year.

Corporate Organization and History within the Last Three years
We were incorporated under the laws of the State of Nevada on January 18, 2007 under the name Siga Resources Inc. We do not have any subsidiaries or affiliated
companies. Since our default have defaulted on payments to keep the ownership in the Lucky Thirteen Claim intact. Consequently, we have lost our interest in the
Lucky Thirteen Claim entirely.
We have not been involved in any bankruptcy, receivership or similar proceedings since inception nor have we been party to a reclassification, merger,
consolidation, or purchase or sale of a significant amount of assets not in the ordinary course of business. We have no intention of entering into a corporate merger
or acquisition.
Business Development since Inception
There is no historical financial information about us upon which to base an evaluation of our performance as an exploration corporation. We are a pre-exploration
stage company and have not generated any revenues from our exploration activities. Further, we have not generated any revenues since our formation on January
18, 2007. We cannot guarantee we will be successful in our exploration activities. Our business is subject to risks inherent in the establishment of a new business
enterprise, including limited capital resources, possible delays in the exploration of our properties, and possible cost overruns due to price and cost increases in
services.
To become profitable and competitive, we commence our exploration of the Big Monty Claims or resurrect our ownership interest in the Lucky Thirteen Claim by
making the requisite payments; or we must find an alternate mining claim. We must obtain equity or debt financing to provide the capital required implement our
phased exploration program.We have no assurance that financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we
will be unable to commence, continue, develop or expand our exploration activities. Even if available, equity financing could result in additional dilution to existing
shareholders.
Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for
the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated any revenues and no revenues are anticipated
until we begin removing and selling minerals. Accordingly, we must raise cash from other sources. Our only other source for cash at this time is investments by
others in the Company.
To meet our need for cash we must raise additional capital. We will attempt to raise additional money through a private placement, public offering or through loans.
We have discussed this matter with our officers and directors. However, our officers and directors are unwilling to make any commitments to loan us any money at
this time. At the present time, we have not made any arrangements to raise additional cash. We require additional cash to continue operations. Such operations
could take many years of exploration and would require expenditure of very substantial amounts of money, money we do not presently have and may never be able
to raise. If we cannot raise it we will have to abandon our planned exploration activities and go out of business.
We estimate we will require $170,535 in cash over the next twelve months. For a detailed breakdown refer to "Liquidity and Capital Reserves". In addition, cash
will be required to cover the phase one cost of completing the exploration work for the Big Monty Claims during that period is estimated at $67,500; and, if
required the phase two costs estimated at $186,000.