UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K/A
Amendment
No. 2
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): October 29, 2012
JAMESON
STANFORD RESOURCES CORPORATION
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(Exact
name of registrant as specified in its charter)
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Nevada
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000-54405
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27-0585702
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(State or
other jurisdiction
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(Commission
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(IRS Employer
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of incorporation)
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File Number)
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Identification
No.)
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10785
West Twain Avenue, Suite 200, Las Vegas, Nevada
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89135
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(Address of principal executive
offices)
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(Zip Code)
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Registrant’s
telephone number, including area code: (702) 933-0808
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(Former
name or former address, if changed since last report)
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Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
[
] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[
] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[
] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[
] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Preliminary
Statement:
Unless the context requires otherwise, all references to “us” “we” “our” “Company”
“Jameson Stanford” or “JSRC” is to the Registrant.
Item
1.01 Entry into a Material Definitive Agreement.
The
Merger
On
May 7, 2012, we entered into an Acquisition Agreement and Plan of Merger, as amended on July 24, 2012 and again on October 24,
2012(the original agreement and amendments thereto are hereinafter collectively referred to as the “Merger Agreement”)
with our wholly-owned subsidiary, JSR Sub Co, a Nevada corporation (“Sub Co”), and Bolcán Mining Corporation,
a Nevada corporation (“Bolcán “). Pursuant to the Merger Agreement, we intend to issue 25,000,000 shares of
our Rule 144 restricted common stock in exchange for 100% of Bolcán’s issued and outstanding capital stock. Concurrent
therewith, Sub Co will merge with and into Bolcán (the “Merger”) with Bolcán surviving the Merger as
our wholly owned subsidiary.
On
July 24, 2012, the above parties entered into an Extension Agreement in order to extend the Effective Time of the Merger to August
3, 2012. On October 24, 2012, the parties entered into a second Extension Agreement extending the closing date for the Merger
to October 29, 2012.
In
a Current Report on Form 8-K filed with the Securities Exchange Commission (the “SEC”) on May 24, 2012, we disclosed
the Merger and attached a copy of the Merger Agreement.
After
closing of the Merger, the former shareholders of Bolcán will own approximately 80% of our common stock, and we will own
100% of Bolcán.
Effective
as of the closing of the Merger, Michael F. Smith, our CEO and a Director will resign from all positions with the Company and
he shall return for cancellation 52,500,000 shares of the Company’s common stock held in his name. Also at closing, Michael
Stanford, the new CEO, will be issued 25,000,000 shares.
The
Merger Agreement is included as
Exhibit 2.1
to this Current Report and is the legal document that governs the terms of
the Merger and the other transactions contemplated by the Merger. The discussion of the Merger Agreement set forth herein is qualified
in its entirety by reference to
Exhibit 2.1
.
Item
2.01 Completion of Disposition or Acquisition of Assets.
On
October 29, 2012 the Merger referenced in Item 1.01 closed. After the Merger, there are now 31,300,000 shares of our common stock
outstanding, of which approximately 80% are held by the former shareholders of Bolcán. Prior to the Merger, we were a shell
company with no business operations. As a result of the Merger, we are no longer considered a shell company.
The
issuance of the shares of our common stock pursuant to the Merger will be made in reliance upon an exemption from registration
under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to Section 4(2) and Regulation D promulgated
thereunder. As such, the shares of our common stock may not be offered or sold unless they are registered under the Securities
Act or an exemption from the registration requirements of the Securities Act is available.
Pursuant
to Item 2.01(f) of Form 8-K, the information that would be required if we were filing a general form for registration of securities
on Form 10 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) upon consummation of the transaction
follows. The information below corresponds to the item numbers of Form 10 under the Exchange Act.
Forward
Looking Statements
The
statements contained in this report that are not historical facts are forward-looking statements that represent management’s
beliefs and assumptions based on currently available information. Forward-looking statements include all statements that are not
historical facts and can be identified by the use of forward-looking terminology such as the words “believes,” “intends,”
“may,” “will,” “should,” “anticipates,” “expects,” “projects,”
“could,” “plans,” or comparable terminology or by discussions of strategy or trends. Although management
believes that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that
these expectations will prove to be correct. Such statements by their nature involve risks and uncertainties that could significantly
affect expected results, and actual future results could differ materially from those described in such forward-looking statements.
Among
the factors that could cause actual future results to differ materially are the risks and uncertainties discussed in this report.
While it is not possible to identify all factors, management continues to face many risks and uncertainties including, but not
limited to, our ability or a target entity to meet the requirements to close any potential acquisition as we grow, the results
of operations and our profitability, the acceptance in the market of the products or services we offer and factors that affect
the mining industry in general as discussed more thoroughly in the risk factors section of this report. Should one or more of
these risks materialize, or should the underlying assumptions prove incorrect, actual results could differ materially from those
expected. We disclaim any intention or obligation to update publicly or revise such statements whether as a result of new information,
future events or otherwise.
Except
as otherwise indicated by the context, references in this Current Report on Form 8-K to “we,” “us” and
“our” are to the consolidated business of the Registrant and Bolcán .
ITEM
1. BUSINESS
Background
and Description of our Business Prior to the Merger
.
We
were originally incorporated under the laws of the state of Nevada in June 2009 as MyOtherCountryClub.com for the purpose of developing
a website that would offer reciprocal golf privileges, and other related services, to members of private country clubs throughout
the United States.
On
March 11, 2010, we filed with the SEC a Registration Statement on Form S-1 (the “S-1”) pursuant to which we registered
for resale 1,900,000 shares of our common stock, of which 900,000 were offered by 38 of our existing shareholders and 1,000,000
were newly issued shares. The S-1 was declared effective on August 11, 2010, at which time we became an Exchange Act reporting
company. We have been unable to execute our proposed business plan so, as reported in our Form 10-K/A filed on May 17, 2011, we
became a shell company.
On
April 27, 2012, we filed a Form 8-K in which we reported, in part, that we had changed our name to Jameson Stanford Resources
Corporation and that we had elected Michael Smith and Michael Stanford to our Board of Directors. Pursuant thereto, we filed with
the state of Nevada a Certificate of Amendment to Articles of Incorporation dated April 27, 2012.
On
May 9, 2012, we filed a Form 8-K in which we reported, in part, that on April 27, 2012, our Board of Directors authorized a 7-for-1
forward split of all outstanding shares of our common stock and a corresponding increase in our authorized common stock pursuant
to Section 78.209 of the Nevada Revised Statutes. The effect of the forward split was to increase the number of our common shares
issued and outstanding from 8,400,000 to 58,800,000 and to increase our authorized common shares from 50,000,000 shares, par value
$0.001, to 350,000,000 shares, par value $0.001. Pursuant thereto we filed with the state of Nevada a Certificate of Change dated
May 2, 2012.
On
October 29, 2012 our Board of Directors terminated Michael Christiansen as our Chief Financial Officer, as his service to the
company is now concluded. There were no disagreements with Mr. Christiansen.
On
October 29, 2012 our Board of Directors appointed Robbie Chidester as Executive Vice President, Chief Financial Officer, Secretary,
and Treasurer. Mr. Chidester will serve as a contracted third party Controller/CFO consultant of the company to perform ongoing
financial management and reporting requirements, and serve in his other capacities on an as needed basis.
Merger
with Bolcán Mining Corporation
On
May 24, 2012, we filed a Form 8-K in which we reported that: (i) on May 7, 2012, we entered into the Merger Agreement with Bolcán
as described above; (ii) on May 4, 2012, our Board of Directors appointed Michael Stanford as President; and (ii) on May 14, 2012,
our Board of Directors appointed Michael Christiansen as Executive Vice President and Chief Financial Officer and Secretary Treasurer.
Description
of Bolcán Mining Corporation’s Business
Bolcán
Mining Corporation (“Bolcán Mining”) was incorporated on April 11, 2012, and The Bolcán Group LLC (“Bolcán
Group”) was formed on October 12, 2010. For purposes of this section entitled “Description of Bolcán Mining
Corporation’s Business” only, all references to “we,” “us,” or “our” or “Bolcán
“ refer to Bolcán Mining and Bolcán Group collectively, prior to the effectiveness of the Merger. Both entities
were formed by and under the control of Michael Stanford.
Bolcán
was formed to pursue the development of certain mining claims, mineral leases and excavation rights for mining projects located
in (a) Star Mining District in Beaver County, Utah, (b) Spor Mountain Mining District in Juab County, Utah, and (c) Ogden Bay
Wildlife Management Area in Weber County, Utah. On April 23, 2012, we acquired certain lode mining claims and mineral leases related
to the Star Mining District and Spor Mountain Mining District projects.
However,
the operating activities of the Bolcán Group were inconsequential until October 2011, and consisted primarily of historical
site research performed by Michael Stanford. Michael Stanford has other mining interests and provides services to the mining industry
that are not part of Bolcán.
Effective
as of June 30, 2012, pursuant to an Asset Purchase Agreement (the “APA”), a copy of which is included as an exhibit
to this Current Report, Bolcán Mining purchased all of the assets and assumed certain liabilities of the Bolcán
Group resulting in a combination of the two companies.
Business
Strategy
We
are a minerals exploration, development and production company focused on acquiring and consolidating mining claims and mineral
leases with potential production and future growth through exploration discoveries. Our current growth strategy is focused on
the initiation and expansion of production operations through the development of our current mining claims and mineral properties
into producing projects.
Since
late 2011, we have been engaged in exploration and acquisition activities in connection with two high-grade copper, gold, silver
and base metals properties located in historic mining districts in Beaver County and Juab County, Utah. During this exploration
phase, we have focused on identification and acquisition of under-explored mining claims and mineral leases in mining districts
that are believed to hold significant unexploited production value. In addition, we have acquired excavation rights and special
permitting related to deposits of alluvial minerals and silica sand located at Ogden Bay, Utah.
On
April 23, 2012, we acquired 117 unpatented lode miming claims from the Bureau of Land Management (“BLM”) related to
the Star Mountain project near Milford, Utah. In May 2012, we commenced start-up activities at the Star Mountain project site
and have completed certain bonding and permitting requirements as specified by the BLM. In addition, on May 1, 2012 we entered
into a mineral lease agreement with the State of Utah for approximately 1,400 acres that are contiguous with the Star Mountain
lode mining claims (“Chopar Mine”). Collectively, the Star Mountain claims and lease encompass a total area of approximately
3,740 acres.
The
lease has an initial term of 10 years, subject to certain extension provisions. The future minimum annual rental commitment is
$1.00 per acre (or $1,408). The lease also provides for a minimum annual royalty payment of $4,224 beginning on the 11th year
of the lease (if extended) and requires contingent production royalty payments based on 4% to 8% of the gross value as defined
in the lease, of non-fissionable and fissionable metalifferous minerals, respectively, extracted from the leased area.
We
are currently in the process of initiating excavation operations at the Chopar Mine site, with first production of copper ore
expected before the end 2012. We anticipate initial deliveries of copper ore to occur in early 2013, and we intend to escalate
production during the balance of 2013.
On May 1, 2012, we entered into
a mineral lease agreement with the State of Utah for approximately 1,920 acres related to the Dugway Minerals project near Delta,
Utah. The lease has an initial term of 10 years subject to certain extension provisions. The future minimum annual rental commitment
is $1.00 per acre (or $1,918). The lease also provides for a minimum annual royalty payment of $5,754 beginning on the 11th year
of the lease (if extended) and requires contingent production royalty payments based on 4% to 8% of the gross value as defined
in the lease, of non-fissionable and fissionable metalifferous minerals, respectively, extracted from the leased area.
We
anticipate that 2012 activities at our Spor Mountain/Dugway Minerals project will be limited to prospecting, exploration and development,
with startup of production operations planned for 2013. At our Ogden Bay Minerals project, we intend to engage subcontractors
for 2012 project operations, while retaining future excavation rights.
Our
business development strategy for 2012-2014 comprises the following activities:
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Initiate
small-scale
production
of
copper
ore
at
the
Chopar
Mine
project
site;
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Ramp
Chopar Mine copper ore production to profitability
and positive cash flow;
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Commission
independent
engineering
reports
to
validate
reserves
in
compliance
with
SEC
Industry
Guide
7;
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Subcontract
production at Ogden Bay Minerals to generate near
term cash flow;
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Initiate
production
at
the
Dugway
Minerals
project
site
in
2013;
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Develop
larger
scale
production
plan
and
capital
investment
program;
and
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Fund
capital investment for significant production expansion.
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Projects
Our
current active projects include:
Star
Mountain/Chopar Mine (Star Mining District)
- The Star Mountain/Chopar Mine project consists of 117 lode-mining claims, and
four metalliferous mineral lease sections located in the Star Mountain range, Star Mining District, in Beaver County, Utah, approximately
five miles west of Milford, Utah. The Star Mountain project involves total area of 3,740 acres. Based on our geological analysis,
magnetometry studies and reverse circulation drilling samples, we believe that the Star Mountain/Chopar Mine involves a significant
geologic formation containing commercial grades of copper ore, plus additional precious and base metals.
Spor
Mountain/Dugway Minerals (Spor Mountain Mining District)
- The Spor Mountain/Dugway Minerals project consists of three
metalifferous mineral lease sections located in Juab County, Utah, approximately six miles southwest of the Dugway Military Proving
Grounds, and 50 miles northwest of Delta, Utah. The Dugway Minerals project involves total area of 1,920 acres. Planned project
activities at Dugway Minerals in 2012 are limited to prospecting, exploration and development. Assuming economic feasibility,
we anticipate startup of production operations in 2013.
Ogden
Bay Minerals
- Ogden Bay Minerals is a developing mineral excavation project on federal protected wetlands, canals and river
systems across 25 square miles of land area known as North Delta, located in West Ogden, Utah. Our excavation and harvesting rights
are maintained through easement rights obtained from Weber County and a special use river/stream alteration permit as part of
a State of Utah/Weber County flood mitigation project.
As
a result of a major storm event in April 2011 that caused flooding of the Weber River and South Fork River, a local state of emergency
was declared by Weber County, Utah. During and after the storm event, we were commissioned by the State of Utah Division of Natural
Resources, USDA Natural Resources Conservation Service and Weber County Emergency Management to restore wildlife habitat, repair
damage, dredge silt and sand, and remove debris from the Weber River. Through this process, we have become an integral part of
an annual maintenance program with the objective of increasing Weber River flow-through capacity to prevent future flood events.
Our
Ogden Bay Minerals project contains deposits of alluvial mineral deposits that are created and replenished from 125 miles of river
flow from the nearby Wasatch Mountain Range. We believe these alluvial mineral deposits contain commercial grades of gold, silver,
zircon and other commercial metals and minerals that can be efficiently extracted by standard separation methods.
Products
We intend to develop our project mining claims,
mineral leases and excavation rights to produce the following specialized mining products:
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Copper
Ore
with
Precious
Metals
Component
—
Hard
rock
mineralized
material
will
be
drilled,
blasted,
excavated
and
hauled,
then
crushed
and
classified
to
customer
specifications.
We
will
deliver
this
product
on-demand
or
just
in
time
to
customers
on
a
24/7
schedule,
utilizing
truck
and
pup
combos
for
local
deliveries,
and
rail
for
regional
deliveries.
The
Union
Pacific
Railroad
main
line
from
Los
Angeles
to
Ogden,
Utah,
is
routed
through
Milford,
Utah,
approximately
five
miles
east
of
our
Star
Mountain
project
site.
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Mined Mineral Concentrates — Finely divided
particles from hard rock mining and recovery operations
containing significant enrichments of silver and gold
will be upgraded by gravity concentrating methods
to contain a minimum 3,000 grams of precious metals
per ton of concentrate. Mineral concentrate products
are dried, bagged, and shipped to customers.
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Refined Precious Metals — During 2013–2014,
we plan to develop a refining capacity for up to two
tons per day of selected precious metals concentrates
from our mining and recovery operations. Precious
metals concentrates containing greater than 50% combined
silver/gold mixture will be further concentrated,
refined, separated and manufactured into bar and ingot
product.
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Our
Industry
Copper
is the world’s third most widely used metal, after iron and aluminum, and an important component in the world’s infrastructure.
Copper has unique chemical and physical properties, including high ductility, malleability, and thermal and electrical conductivity,
and resistance to corrosion that has made it a superior material for use in electrical and electronic products, including power
transmission and generation, which accounts for about three quarters of its global copper use, telecommunications, building construction,
transportation and industrial machinery businesses. Copper is also an important metal in non-electrical applications such as plumbing
and roofing and, when alloyed with zinc to form brass, in many industrial and consumer applications.
Copper
is an internationally traded commodity with prices principally determined by the major metal exchanges, the Commodities Exchange,
or “COMEX”, in New York and the London Metal Exchange or “LME”. Copper is usually found in association
with sulfur. Pure copper metal is generally produced during a multistage process beginning with the mining and concentrating of
low-grade ores containing copper sulfide minerals followed by smelting and electrolytic refining to produce a pure copper cathode.
An increasing share of copper is produced from acid leaching of oxidized ores. Copper is one of the oldest metals ever used and
has been one of the important materials in the development of civilization.
Copper
Market
. Copper is an important industrial metal, with significant demand for fabrication of electrical wires, plumbing, and
industrial machinery. Most copper is mined or extracted as copper sulfides from large open pit mines in porphyry copper deposits
that contain 0.4% to 1.0% copper. Copper is 100% recyclable with no quality degradation, and is the third most recycled metal.
It is estimated that 80% of the copper ever mined is still in use today.
Gold
Market
. The global market for gold is large and highly liquid. Primary demand for gold is associated with a safe haven investment,
with additional demand for jewelry, industrial and health science applications. Gold is also considered a hedge against inflation,
and a commodity of refuge from concerns with fiat currencies and corresponding risks related to economic, political and social
uncertainties.
The
World Gold Council, a leading international gold industry research organization, published on its website that total gold demand
for the fourth quarter of 2011 increased 21% to 1,017 metric tons (a metric ton is equal to 2,204.6 pounds) year-over-year. Of
this increase, investment demand posted the largest segment increase, more than offsetting the decline in gold jewelry demand.
Silver
Market
. Demand for silver is predominantly for industrial applications, especially electronics and jewelry, with investment
making up only a small portion of total annual demand.
Government
and Environmental Regulation
Our
mining, processing operations and exploration activities are subject to various laws and regulations governing: (i) the protection
of the environment, (ii) exploration, (iii) mine safety, development and production, (iv) exports, (v) taxes, (vi) labor standards,
(vii) occupational health, (viii) waste disposal, (ix) hazardous substances, (x) water rights, (xi) explosives, (xii) land reclamation
and (xiii) other matters. New laws and regulations, amendments to existing laws and regulations or more stringent implementation
of existing laws and regulations could have a material adverse impact on us, increase costs, cause a reduction in levels of, or
suspension of, production and/or delay or prevent the development of new mining properties.
The
governmental agencies and regulators tasked with implementing and enforcing the above laws and regulations include Beaver County
(Utah), the Bureau of Land Management, the Mine Safety and Health Administration, the Utah Department of Natural Resources, the
Utah State Institutional Trust Lands Administration, the Utah Department of Environmental Quality, the Environmental Protection
Agency, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
We
believe we are currently in compliance in all material respects with all applicable environmental laws and regulations. Such compliance
requires significant expenditures and increases mine development and operating costs. Mining is subject to potential risks and
liabilities associated with pollution of the environment and the disposal of waste products occurring as a result of mineral exploration
and production. Environmental liability may result from mining activities conducted by others prior to our ownership of a property.
To the extent we are subject to uninsured environmental liabilities, the payment of such liabilities would reduce our otherwise
available earnings and could have a material adverse effect on our business plan.
Licenses
and Permits
Our
operations require licenses and permits from various governmental authorities. We believe we hold all material licenses and permits
required under applicable laws and regulations and believe we are presently complying in all material respects with the terms
of such licenses and permits . However, such licenses and permits are subject to change in various circumstances. There can be
no guarantee that we will be able to obtain or maintain all necessary licenses and permits that may be required to explore and
develop our properties, commence construction or operation of mining facilities and properties under exploration or development
or to maintain continued operations that economically justify the cost.
Mine
Safety and Health Administration Regulations
Pursuant
to Section 1503(a) of the recently enacted Dodd-Frank Wall Street Reform and Consumer Protection Act, issuers that are operators,
or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their
periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related
assessments and legal actions, and mining-related fatalities. At this time, we have no safety violations, orders, citations, related
assessments or legal actions, or mining-related fatalities to report.
Competition
Because
the life of a mine is limited by its mineral reserves, we plan to continually seek to replace and expand our reserves through
the exploration of existing properties as well as through acquisitions of interests in new properties or of interests in companies
which own such properties. We encounter competition from other mining companies in connection with the acquisition of properties
and with the engaging and maintaining of qualified industry experienced personnel. This competition may increase the cost of acquiring
suitable properties and retaining qualified industry experienced personnel.
ITEM
1A. RISK FACTORS
YOU
SHOULD CAREFULLY CONSIDER THE FOLLOWING FACTORS, IN ADDITION TO THE OTHER INFORMATION INCLUDED ELSEWHERE IN THIS CURRENT REPORT
AND THE DOCUMENTS THAT WE HAVE FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (“SEC”). UNLESS THE CONTEXT REQUIRES
OTHERWISE, THE USE OF THE COMPANIES, THE COMBINED COMPANY, “US,” OR “WE” REFERS TO THE COMBINED COMPANY
OF BOLCÁN AND US AFTER GIVING EFFECT TO THE MERGER. ADDITIONAL RISKS AND UNCERTAINTIES NOT PRESENTLY KNOWN TO US OR THAT
ARE NOT CURRENTLY BELIEVED TO BE IMPORTANT TO YOU, IF THEY MATERIALIZE, ALSO MAY ADVERSELY AFFECT US AND OUR STOCK PRICE.
Our
business is to engage in exploration and production activities in the precious minerals mining industry, which is a highly speculative
activity. An investment in our securities involves a high degree of risk. You should not invest in our securities if you cannot
afford to lose your entire investment. In deciding whether you should invest in our securities, you should carefully consider
the following information together with all of the other information contained in this Current Report. Any of the following risk
factors could cause our business, prospects, financial condition or results of operations to suffer and you to lose all or part
of your investment.
Risks
Related To Our Business And Financial Condition
Estimates
of mineralized material are based on interpretation and assumptions and may yield less mineral production under actual conditions
than is currently estimated
.
There
are numerous uncertainties inherent in estimating quantities of mineralized material such as copper, gold and silver, including
many factors beyond our control, and no assurance can be given that the recovery of mineralized material will be realized. In
general, estimates of mineralized material are based upon a number of factors and assumptions made as of the date on which the
estimates were determined, including:
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geological
and
engineering
estimates
that
have
inherent
uncertainties
and
the
assumed
effects
of
regulation
by
governmental
agencies;
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the
judgment of the engineers preparing the estimates;
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estimates
of
future
metals
prices
and
operating
costs;
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●
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the
quality
and
quantity
of
available
data;
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●
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the
interpretation
of
that
data;
and
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●
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the
accuracy of various mandated economic assumptions,
all of which may vary considerably from actual results.
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Until
mineralized material is actually mined and processed, it must be considered an estimate only. These estimates are imprecise and
depend on geological interpretation and statistical inferences drawn from drilling and sampling analysis, which may prove to be
unreliable. We cannot assure you that these mineralized material estimates will be accurate or that this mineralized material
can be mined or processed profitably. Any material changes in estimates of mineralized material will affect the economic viability
of placing a property into production and such property’s return on capital. There can be no assurance that minerals recovered
in small-scale metallurgical tests will be recovered at production scale.
We
may have difficulty meeting our current and future capital requirements
.
Our
management and our board of directors monitor our overall costs and expenses and, if necessary, adjust our programs and planned
expenditures in an attempt to ensure we have sufficient operating capital. We continue to evaluate our costs and planned expenditures
for our on-going development and care and maintenance efforts at our mineral properties. The continued development , care and
maintenance of our mineral properties will require significant amounts of additional capital. As a result, we likely will need
to explore raising additional capital during fiscal 2012 and beyond so that we can continue to fully fund our planned activities.
Our ability to obtain this financing will depend upon, among other things, the price of minerals and the industry’s perception
of its future price. The extraordinary conditions in the global financial and capital markets have currently limited the availability
of this funding. Therefore, availability of funding is dependent largely upon factors outside of our control and cannot be accurately
predicted. If the disruptions in the global financial and capital markets continue, debt or equity financing may not be available
to us on acceptable terms, if at all. If we are unable to fund future operations by way of financing, including public or private
offerings of equity or debt securities, our business, financial condition and exploration activities will be adversely impacted.
The
volatility of the price of gold or silver and other precious metals could adversely affect our future operations and, if warranted,
our ability to develop our properties.
The
potential for profitability of our operations, the value of our properties and our ability to raise funding to conduct continued
exploration and development, if warranted, are directly related to the market prices of gold, silver and other precious metals.
The prices of such metals fluctuate widely and are affected by numerous factors beyond our control including interest rates, expectations
for inflation, speculation, currency values (in particular the strength of the U.S. dollar), global and regional demand, political
and economic conditions, global and regional demand, the sale of gold and silver by central banks, the political and economic
conditions of major gold and silver producing countries throughout the world, and production costs in major metal producing regions
of the world. The price of gold may also have a significant influence on the market price of our common stock and the value of
our properties. Our decision to put a mine into production and to commit the funds necessary for that purpose must be made long
before the first revenue from production would be received. A decrease in the prices of gold or silver may prevent our property
from being economically mined or result in the write-off of assets whose value is impaired as a result of lower gold, zinc, lead,
copper or silver prices.
The
nature of mineral exploration and production activities involves a high degree of risk and the possibility of uninsured losses
.
Exploration
for and the production of minerals is highly speculative and involves greater risk than many other businesses. Many exploration
programs do not result in the discovery of mineralization, and any mineralization discovered may not be of sufficient quantity
or quality to be profitably mined. Our operations are, and any future development or mining operations we may conduct will be,
subject to all of the operating hazards and risks normally incident to exploring for and development of mineral properties, such
as, but not limited to:
|
●
|
Economically
insufficient
mineralized
material;
|
|
●
|
Fluctuation
in
production
costs
that
make
mining
uneconomical;
|
|
●
|
Unanticipated
variations in grade and other geologic problems;
|
|
●
|
Difficult
surface
or
underground
conditions;
|
|
●
|
Metallurgic
and
other
processing
problems;
|
|
●
|
Mechanical
and
equipment
performance
problems;
|
|
●
|
Failure
of
pit
walls
or
dams;
|
|
●
|
Unusual
or unexpected rock formations;
|
|
●
|
Personal
injury,
fire,
flooding,
cave-ins
and
landslides;
and
|
|
●
|
Decrease
in
the
value
of
mineralized
material
due
to
lower
gold
or
silver
prices.
|
Any
of these risks can materially and adversely affect, among other things, the development of properties, production quantities and
rates, costs and expenditures, potential revenues and production dates. We currently have limited insurance to guard against some
of these risks. If we determine that capitalized costs associated with any of our mineral interests are not likely to be recovered,
we would incur a write down of our investment in these interests. All of these factors may result in losses in relation to amounts
spent which are not recoverable or result in additional expenses.
Difficult
conditions in the global capital markets and the economy generally may materially and adversely affect our business and results
of operations, and we do not expect these conditions to improve in the near future.
Our
results of operations are materially affected by conditions in the domestic capital markets and the economy generally. The stress
experienced by domestic capital markets that began in the second half of 2007 has continued and substantially increased into the
present. Recently, concerns over inflation, energy costs, geopolitical issues, the availability and cost of credit, the U.S. mortgage
market and a declining real estate market in the U.S. have contributed to increased volatility and diminished expectation for
the economy and the markets going forward. These factors, combined with volatile oil and gas prices, declining business and consumer
confidence and increased unemployment, have precipitated an economic slowdown and fears of a continued recession. In addition,
the fixed-income markets are experiencing a period of extreme volatility that has negatively impacted market liquidity conditions.
Title
to our properties may be challenged or defective
.
Our
planned future operations and exploration activities may require amendments to our currently approved permits from various governmental
authorities. Our operations are and will continue to be governed by laws and regulations governing prospecting, mineral exploration,
exports, taxes, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine
safety, mining royalties and other matters. There can be no assurance that we will be able to acquire all required licenses, permits,
amendments or property rights on reasonable terms or in a timely manner, or at all, and that such terms will not be adversely
changed, that required extensions will be granted, or that the issuance of such licenses, permits or property rights will not
be challenged by third parties.
We
attempt to confirm the validity of our rights of title to, or contract rights with respect to, each mineral property in which
we have a material interest. However, we cannot guarantee that title to our properties will not be challenged. Our mineral properties
may be subject to prior unregistered agreements, interests or native land claims, and title may be affected by undetected defects.
There may be valid challenges to the title of any of the claims comprising our mineral properties that, if successful, could impair
possible development and/or operations with respect to such properties in the future. Challenges to permits or property rights,
whether successful or unsuccessful; changes to the terms of permits or property rights; or a failure to comply with the terms
of any permits or property rights that have been obtained, could have a material adverse effect on our business by delaying or
preventing or making continued operations economically unfeasible.
We
are subject to complex environmental and other regulatory risks, which could expose us to significant liability and delay, and
potentially the suspension or termination of our development efforts
.
Compliance
with environmental quality requirements and reclamation laws imposed by federal, state, provincial, and local governmental authorities
may:
|
●
|
require
significant capital outlays;
|
|
●
|
materially
affect
the
economics
of
a
given
property;
|
|
●
|
cause
material
changes
or
delays
in
our
intended
activities;
and
|
These
regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set
limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Applicable authorities may require
us to prepare and present data pertaining to the effect or impact that any proposed exploration for or production of minerals
may have upon the environment. The requirements imposed by any such authorities may be costly, time consuming, and may delay operations.
Future legislation and regulations designed to protect the environment, as well as future interpretations of existing laws and
regulations, may require substantial increases in equipment and operating costs and delays, interruptions, or a termination of
operations. We cannot accurately predict or estimate the impact of any such future laws or regulations, or future interpretations
of existing laws and regulations, on our operations.
Historic
mining activities have occurred on certain areas of our properties by unrelated parties prior to the general mining law of 1872,
prior to the Federal Land Policy and Management Act of 1976, prior to the Resources Conservation & Recovery Act of October
21, 1978, and subsequent other Federal/State regulatory acts and statutes. If such historic activities have resulted in releases
or threatened releases of regulated substances to the environment, potential for liability however unlikely may exist under federal
or state remediation statutes. Such liability would include remediating any damage that we may have caused, including costs for
removing or remediating the release and damage to natural resources, including ground water, as well as the payment of fines and
penalties. We are not aware of any such claims under these statutes at this time and cannot predict whether any such claims will
be asserted in the future.
We
may produce air emissions and pollutions that could fall under the jurisdiction of U.S. federal laws
.
Under
the U.S. Resource Conservation and Recovery Act, mining companies may incur costs for generating, transporting, treating, storing,
or disposing of hazardous waste, as well as for closure and post-closure maintenance once they have completed mining activities
on a property. Our mining operations may produce air emissions, including fugitive dust and other air pollutants, from stationary
equipment, storage facilities, and the use of mobile sources such as trucks and heavy construction equipment which are subject
to review, monitoring and/or control requirements under the Federal Clean Air Act and state air quality laws. Permitting rules
may impose limitations on our production levels or create additional capital expenditures in order to comply with the rules.
Legislation
has been proposed that would significantly affect the mining industry
.
Periodically,
members of the U.S. Congress have introduced bills which would supplant or alter the provisions of the General Mining Law of 1872,
which governs the unpatented claims that we control with respect to our U.S. properties. One such amendment has become law and
has imposed a moratorium on the patenting of mining claims, which reduced the security of title provided by unpatented claims
such as those on our properties
.
If additional legislation is enacted, it could substantially increase the cost of holding
unpatented mining claims by requiring payment of royalties and could significantly impair our ability to develop mineral estimates
on unpatented mining claims. Such bills have proposed, among other things, to make permanent the patent moratorium, to impose
a federal royalty on production from unpatented mining claims and to declare certain lands as unsuitable for mining. Although
it is impossible to predict at this time what royalties may be imposed in the future, the imposition of such royalties could adversely
affect the potential for development of such mining claims and the economics of existing operating mines on federal unpatented
mining claims. Passage of such legislation could adversely affect our business.
Our
operations are subject to permitting requirements which could require us to delay, suspend or terminate our operations on our
mining properties
.
Our
operations, including ongoing exploration drilling programs, require permits from the state and federal governments, including
permits for the use of water and for drilling wells for water. We may be unable to obtain these permits in a timely manner, on
reasonable terms or on terms that provide us sufficient resources to develop our properties, or at all. Even if we are able to
obtain such permits, the time required by the permitting process can be significant. If we cannot obtain or maintain the necessary
permits, or if there is a delay in receiving these permits, our timetable and business plan for exploration of our properties
will be adversely affected, which may in turn adversely affect our results of operations, financial condition and cash flows.
We
may face a shortage of water.
Water
is essential in all phases of the exploration, development and operation of mineral properties. The nature of our operations requires
water to be used in such processes as exploration, drilling, testing, dust suppression, milling and tailings disposal. The lack
of available water and the cost of acquisition may make an otherwise viable project economically impossible to complete.
Global
climate change is an international concern and could impact our ability to conduct future operations
.
Global
climate change is an international issue and receives an enormous amount of publicity. We would expect that the imposition of
international treaties or federal, state or local laws or regulations pertaining to mandatory reductions in energy consumption
or emissions of greenhouse gasses could affect the feasibility of our mining projects and increase our operating costs.
Because
access to the mineral property may be restricted by inclement weather or other hazards, we may be delayed in our development efforts
.
We
are subject to risks and hazards including environmental hazards, the existence of unusual or unexpected geological formations,
the occurrence of cave-ins, flooding, earthquakes, and periodic interruptions due to inclement or hazardous weather conditions.
As a result, access to our mineral properties may be restricted during parts of the year. During the winter months, heavy snowfall
can make it difficult to undertake work programs. Frequent inclement weather in the winter months can make development and mining
activities difficult for short periods of time.
We
may face a shortage of supplies, equipment and materials
.
The
mineral industry has experienced from time to time shortages of certain supplies, equipment and materials necessary in the exploration,
evaluation, development and production of mineral deposits. The prices at which such supplies and materials are available have
also greatly increased. Our planned operations could be subject to delays due to such shortages and further price escalations
could increase our costs for such supplies, equipment and materials. Our experience and that of others in the industry is that
suppliers are often unable to meet contractual obligations for supplies, equipment, materials, and services, and that alternate
sources of supply do not exist.
The
market for obtaining desirable properties, investment capital, and outside engineers and consultants is highly competitive
.
Presently,
we employ a limited number of full-time employees, utilize outside consultants, and in large part rely on the personal efforts
of our officers and directors. Our success will depend, in part, upon the ability to attract and retain qualified outside engineers
and other professionals to develop and operate our mineral properties, in addition to obtaining investment capital to conduct
our mining operations. We believe that we will be able to attract competent employees and consultants, but no assurance can be
given that we will be successful in this regard as competition for these professionals is highly competitive. If we are unable
to engage and retain the necessary personnel, our business would be materially and adversely affected.
We
depend upon a limited number of personnel and the loss of any of these individuals could adversely affect our business
.
If
any of our current executive employees were to die, become disabled or leave our company, we would be forced to identify and retain
individuals to replace them. Mr.. Michael Stanford is our sole Director and our critical employee at this time. There is no assurance
that we can find suitable individuals to replace him or to add to our employee base if that becomes necessary. We are entirely
dependent on Mr. Stanford as our critical personnel at this time. We have no life insurance on Mr. Stanford.
We
have incurred substantial losses since our inception and may never be profitable
.
We
have incurred losses since inception resulting in an accumulated stockholders’ equity deficit of $248,106 as of June 30,
2012, and further losses are anticipated in the development of our business. As a development stage enterprise, there exists substantial
doubt regarding our ability to continue as a going concern. The ability to continue as a going concern is dependent upon generating
profitable operations in the future and/or to obtain the necessary financing to meet our obligations and repay our liabilities
arising from normal business operations. Management intends to finance operating costs over the next twelve months with existing
cash on hand, loans from stockholders and directors, and the private placement of common stock.
We
currently have not entered into forward sales, commodity, derivatives or hedging arrangements with respect to our mineral production
and as a result we are exposed to the impact of any significant decrease in mineral prices.
We
expect to sell the minerals we expect to be producing at prevailing market prices. Currently, we have not entered into forward
sales, commodity, derivative or hedging arrangements to establish a price in advance for the sale of future production, although
we may do so in the future. As a result, we may realize the benefit of any short-term increase in prices, but we are not protected
against decreases, and if prices decrease significantly, our expected future revenues may be materially and adversely affected.
Our
ability to become and remain profitable over the long term will depend on our ability to identify, explore and develop our current
and additional properties
.
Gold,
silver, and other mineral properties are wasting assets. They eventually become depleted or uneconomical to continue mining. Our
ability to become and remain profitable over the long term depends on our ability to finalize the design, permit, development
and profitable extraction and recovery of mineral resources beyond our current planned mine life. If our ability to expand the
operations beyond their current planned mined lives does not occur we may seek to acquire other precious and base metals properties
beyond our current properties. The acquisition of precious and base metals properties and their exploration and development are
subject to intense competition. Companies with greater financial resources, larger staff, more experience and more equipment for
exploration and development may be in a better position to compete for such mineral properties. If we are unable to find, develop,
and economically mine new properties, we most likely will not be profitable on a long-term basis and the price of our common stock
may suffer.
Because
we have a very limited operating history, investors have little basis to evaluate our ability to operate
.
Our
activities to date have been focused on raising capital funds, exploring our properties and preparing those properties for production.
Although some of our mine and concentrating facilities have previously operated, these operations were carried out under different
ownership and, therefore, we face all of the risks commonly encountered by other businesses that lack an established operating
history including the need for additional capital and personnel, and intense competition. There is no assurance that our business
plan will be successful.
The
construction of our mines and optimization and continued operation of our mills are subject to all of the risks inherent in construction,
start-up and operations
.
These
risks include potential delays, cost overruns, shortages of material or labor, construction defects, breakdowns and injuries to
persons and property. We expect to engage self-employed personnel, subcontractors and material suppliers in connection with the
construction and development of our mine projects. While we anticipate taking all measures that we deem reasonable and prudent
in connection with construction of the mines and the operation of the mills, there is no assurance that the risks described above
will not cause delays or cost overruns in connection with such construction or operation. Any delays would postpone our anticipated
receipt of revenue and adversely affect our operations, which in turn may adversely affect the price of our stock.
We
do not insure against all of the risks to which we may be subject in our operations.
While
we currently maintain insurance against general commercial liability claims and the physical assets at our projects, we do not
maintain insurance to cover all of the potential risks associated with our operations. We might be subject to liability for environmental,
pollution or other hazards associated with mineral exploration and development, which risks may not be insured against, which
may exceed the limits of our insurance coverage, or which we may elect not to insure against because of premium costs or other
reasons. We may also not be insured against interruptions to our operations. Losses from these or other events may cause us to
incur significant costs which could materially and adversely affect our financial condition and our ability to fund activities
on our property. A significant loss could force us to reduce or terminate our operations.
We
may require significant additional capital to fund our business plan
.
We
will be required to expend significant funds to determine if proven and probable mineral reserves exist at some of our properties,
to continue exploration, and if warranted, develop our existing properties and to identify and acquire additional properties to
diversify our property portfolio. There can be no assurance that any of the development properties we now hold, or which we may
acquire, will contain a commercial ore reserve, and therefore, no assurance that we will ever generate a positive cash flow from
the sale of production on such properties. In addition, once we decide to place a property into production, risks still exist
that the amount and grade of the reserves may be significantly less than predicted. We have spent and will be required to continue
to spend significant amounts of capital for drilling, geological and geochemical analysis, assaying and feasibility studies with
regard to the results of our exploration. We may not benefit from these investments if we are unable to identify commercially
exploitable mineralized material.
Our
ability to obtain necessary funding for these purposes, in turn, depends upon a number of factors, including the status of the
national and worldwide economy and the prices of gold and other precious and base metals. Capital markets worldwide have been
adversely affected by substantial losses by financial institutions, in turn caused by investments in asset-backed securities.
We may not be successful in obtaining the required financing, or if we can obtain such financing, such financing may not be on
terms that are favorable to us. Failure to obtain such additional financing could result in delay or indefinite postponement of
further mining operations or exploration and development and the possible partial or total loss of our potential interest in our
properties.
Our
operating costs could be adversely affected by inflationary pressures especially to labor and fuel costs
.
The
global economy is currently in a period of high commodity prices and, as a result, the mining industry is attempting to increase
production. This has caused significant upward price pressures in the operating costs of mining companies, especially in the area
of skilled labor. The skilled labor needed by the mining industry is in tight supply and its cost is increasing. Many of our competitors
have lower costs and their mines are located in better locations that may give them a competitive advantage in employee hiring
and retention.
The
cost of fuel to run machinery and generate electricity is closely correlated to the price of oil and energy. Over the past two
years, the price of oil has risen significantly and has increased the operating cost of mines dependent on fuel to run their business.
Continued upward price pressures in our operating costs may cause us to generate significantly less operating cash flows than
expected which would have an adverse impact to our business.
We
will continue to incur losses for the foreseeable future
.
Prior
to completion of the development and pre-production stage, we anticipate that we will incur increased operating expenses without
realizing any significant revenues. We expect to incur continued and significant losses until such time that we achieve commercial
production from our mining operations on our mineral claims. As a result of continuing losses, we may exhaust all of our resources
and be unable to complete development of our planned mining operations. Our accumulated deficit will continue to increase as we
continue to incur losses. We may not be able to generate profits or continue operations if we are unable to generate significant
revenues from future mining of the mineral claims and our business will most likely fail.
Risks
Related To Our Common Stock
There
currently is only a minimal public market for our Common Stock. Failure to develop or maintain a trading market could negatively
affect the value of our Common Stock and make it difficult or impossible for you to sell your shares.
There
currently is only a minimal public market for shares of our common stock and an active market may never develop. Our common stock
is quoted on the OTCQB operated by OTC Markets Group Inc. under the symbol “JMSN”. We may not ever be able to satisfy
the listing requirements for our common stock to be listed on an exchange, which are often a more widely-traded and liquid market.
Some, but not all, of the factors that may delay or prevent the listing of our common stock on a more widely-traded and liquid
market include the following: our stockholders’ equity may be insufficient; the market value of our outstanding securities
may be too low; our net income from operations may be too low; our common stock may not be sufficiently widely held; we may not
be able to secure market makers for our common stock; and we may fail to meet the rules and requirements mandated by the several
exchanges and markets to have our common stock listed.
We
cannot assure you that the common stock will become liquid or that it will be listed on a securities exchange.
Until
our common stock is listed on a national securities exchange such as the New York Stock Exchange or the Nasdaq Stock Market, we
expect our common stock to remain eligible for quotation on the OTCQB, or other over-the-counter quotation systems. In such venues,
however, an investor may find it difficult to obtain accurate quotations as to the market value of our common stock. In addition,
if we fail to meet the criteria set forth in SEC regulations, various requirements would be imposed by law on broker-dealers who
sell our securities to persons other than established customers and accredited investors. Consequently, such regulations may deter
broker-dealers from recommending or selling our common stock, which may further affect the liquidity of the common stock. This
would also make it more difficult for us to raise capital.
The
application of the “penny stock” rules could adversely affect the market price of our common shares and increase your
transaction costs to sell those shares.
The
SEC has adopted rule 3a51-1 that establishes the definition of a “penny stock,” for the purposes relevant to us, as
any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share,
subject to certain exceptions. For any transaction involving a penny stock, unless exempt, Rule 15g-9 requires:
|
●
|
that
a
broker
or
dealer
approves
a
person’s
account
for
transactions
in
penny
stocks,
and
|
|
●
|
that
the
broker
or
dealer
receives
from
the
investor
a
written
agreement
to
the
transaction,
setting
forth
the
identity
and
quantity
of
the
penny
stock
to
be
purchased.
|
In
order to approve a person’s account for transactions in penny stocks, the broker or dealer must:
|
●
|
obtain
financial
information
and
investment
experience
objectives
of
the
person,
and
|
|
●
|
make
a
reasonable
determination
that
the
transactions
in
penny
stocks
are
suitable
for
that
person
and
the
person
has
sufficient
knowledge
and
experience
in
financial
matters
to
be
capable
of
evaluating
the
risks
of
transactions
in
penny
stocks.
|
The
broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating
to the penny stock market, which, in highlight form:
|
●
|
sets
forth the basis on which the broker or dealer made
the suitability determination and
|
|
●
|
that
the
broker
or
dealer
received
a
signed,
written
agreement
from
the
investor
prior
to
the
transaction.
|
Generally,
brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make
it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock.
The
market price for our common shares is particularly volatile given our status as a relatively unknown company with a small and
thinly traded public float, limited operating history and lack of profits that could lead to wide fluctuations in our share price.
You may be unable to sell your common shares at or above your purchase price, which may result in substantial losses to you.
The
market for our common shares is characterized by significant price volatility when compared to seasoned issuers, and we expect
that our share price will continue to be more volatile than a seasoned issuer for the indefinite future. The volatility in our
share price is attributable to a number of factors. First, as noted above, our common shares are sporadically and thinly traded.
As a consequence of this lack of liquidity, the trading of relatively small quantities of shares by our shareholders may disproportionately
influence the price of those shares in either direction. The price for our shares could, for example, decline precipitously in
the event that a large number of our common shares are sold on the market without commensurate demand, as compared to a seasoned
issuer which could better absorb those sales without adverse impact on its share price. Secondly, we are a speculative or “risky”
investment due to our limited operating history and lack of profits to date, and uncertainty of future market acceptance for our
potential products and services. As a consequence of this enhanced risk, more risk-adverse investors may, under the fear of losing
all or most of their investment in the event of negative news or lack of progress, be more inclined to sell their shares on the
market more quickly and at greater discounts than would be the case with the stock of a seasoned issuer. Many of these factors
are beyond our control and may decrease the market price of our common shares, regardless of our operating performance. We cannot
make any predictions or projections as to what the prevailing market price for our common shares will be at any time including
as to whether our common shares will sustain their current market prices or as to what effect that the sale of shares or the availability
of common shares for sale at any time will have on the prevailing market price.
We
do not pay dividends on our Common Stock.
We
have not paid any dividends on our common stock and do not anticipate paying dividends in the foreseeable future. We plan to retain
earnings, if any, to finance the development and expansion of our business.
Failure
to achieve and maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 could have
a material adverse effect on our business and stock price.
Section
404 of the Sarbanes-Oxley Act of 2002 (“the Sarbanes-Oxley Act”) requires that we establish and maintain an adequate
internal control structure and procedures for financial reporting and include a report of management on our internal control over
financial reporting in our annual report on Form 10-K. That report must contain an assessment by management of the effectiveness
of our internal control over financial reporting and must include disclosure of any material weaknesses in internal control over
financial reporting that we have identified.
Rule
144 Related Risk.
The
SEC adopted amendments to Rule 144 which became effective on February 15, 2008 that apply to securities acquired both before and
after that date. Under these amendments, a person who has beneficially owned restricted shares of our common stock for at least
six months would be entitled to sell their securities provided that: (i) such person is not deemed to have been one of our affiliates
at the time of, or at any time during the three months preceding a sale, (ii) we are subject to the Exchange Act periodic reporting
requirements for at least 90 days before the sale and (iii) if the sale occurs prior to satisfaction of a one-year holding period,
we provide current information at the time of sale.
Persons
who have beneficially owned restricted shares of our common stock for at least six months but who are our affiliates at the time
of, or at any time during the three months preceding a sale, would be subject to additional restrictions by which such person
would be entitled to sell within any three-month period only a number of securities that does not exceed the greater of either
of the following:
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●
|
1%
of
the
total
number
of
securities
of
the
same
class
then
outstanding;
or
|
|
●
|
the
average
weekly
trading
volume
of
such
securities
during
the
four
calendar
weeks
preceding
the
filing
of
a
notice
on
Form
144
with
respect
to
the
sale;
|
provided,
in each case, that we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale.
Such sales by affiliates must also comply with the manner of sale, current public information and notice provisions of Rule 144.
Restrictions
on the reliance of Rule 144 by Shell Companies or former Shell Companies.
Historically,
the SEC staff has taken the position that Rule 144 is not available for the resale of securities initially issued by companies
that are, or previously were, blank check companies, like us. The SEC has codified and expanded this position in the amendments
discussed above by prohibiting the use of Rule 144 for resale of securities issued by any shell companies (other than business
combination related shell companies) or any issuer that has been at any time previously a shell company. The SEC has provided
an important exception to this prohibition, however, if the following conditions are met:
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●
|
The
issuer of the securities that was formerly a shell
company has ceased to be a shell company,
|
|
●
|
The
issuer
of
the
securities
is
subject
to
the
reporting
requirements
of
Section
14
or
15(d)
of
the
Exchange
Act,
|
|
●
|
The
issuer
of
the
securities
has
filed
all
Exchange
Act
reports
and
material
required
to
be
filed,
as
applicable,
during
the
preceding
12
months
(or
such
shorter
period
that
the
issuer
was
required
to
file
such
reports
and
materials),
other
than
Current
Reports
on
Form
8-K;
and
|
|
●
|
At
least
one
year
has
elapsed
from
the
time
that
the
issuer
filed
current
comprehensive
disclosure
with
the
SEC
reflecting
its
status
as
an
entity
that
is
not
a
shell
company.
|
As
a result, it is likely that pursuant to Rule 144, stockholders who receive our restricted securities in a business combination
will not be able to sell our shares without registration until one year after we have completed our initial business combination.
ITEM
2. FINANCIAL INFORMATION
Management’s
Discussion And Analysis Of Financial Condition And Results Of Operations
The
following management’s discussion and analysis should be read in conjunction with our and Bolcán’s historical
combined financial statements and the related notes. The management’s discussion and analysis contains forward-looking statements
that involve risks and uncertainties, such as statements of our plans, objectives, expectations and intentions. Any statements
that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,”
“intend,” “anticipate,” “target,” “estimate,” “project,” “expect”
and the like, and/or future tense or conditional constructions (“will,” “may,” “could,” “should,”
etc.), or similar expressions, identify certain of these forward-looking statements. These forward-looking statements are subject
to risks and uncertainties that could cause actual results or events to differ materially from those expressed or implied by the
forward-looking statements in this Current Report. Our actual results and the timing of events could differ materially from those
anticipated in these forward-looking statements as a result of several factors. We disclaim any obligation to update forward-looking
statements to reflect events or circumstances occurring after the date of this Current Report. Please see “Forward-Looking
Statements” and “Risk Factors” for a discussion of the uncertainties, risks and assumptions associated with
these forward-looking statements.
As
the result of the Merger and the change in our business and operations to engaging in exploration and production activities in
the precious metal industry, a discussion of our past financial results is not pertinent, and our historical financial results
and those of Bolcán, the accounting acquirer prior to the Merger are considered the historical financial results of Bolcán
The
following discussion highlights our plan of operations and the principal factors that have affected our financial condition as
well as our liquidity and capital resources for the periods described. This discussion contains forward-looking statements. The
following discussion and analysis are based on Bolcán’s financial statements, which we have prepared in accordance
with U.S. Generally Accepted Accounting Principles (“GAAP”). You should read the discussion and analysis together
with such financial statements and the related notes thereto.
The
following discussion and analysis provides information which management believes is relevant for an assessment and understanding
of the statements of financial condition and results of operations presented herein. The discussion should be read in conjunction
with our audited and unaudited financial statements and related notes and the other financial information included elsewhere in
this report.
Plan
of Operations
Since
the Merger, we are a minerals exploration, development and production company focused on acquiring and consolidating mining claims
and mineral leases with potential production and future growth through exploration discoveries. Our current growth strategy is
focused on the initiation and expansion of production operations through the development of our current mining claims and mineral
properties into producing projects.
Results
of Operations for the six months ended June 30, 2012, and from October 12, 2010 (Inception) to December 31, 2011
.
Revenue
No
revenue was generated during the six months ended June 30, 2012, as compared to revenue of $89,994 generated from inception to
December 31, 2011. The decrease was due to a reduced level of activity at our Ogden Bay Minerals and Star Mountain projects during
the winter season.
Cost
of revenue
The
cost of revenue during the six months ended June 30, 2012 was zero as compared to $66,227 for the period from inception to December
31, 2011. There was no revenue generated for the six months ended June 30, 2012 so there were no associated costs of revenue.
Operating
Expenses
Operating
expenses during the six months ended June 30, 2012 totaled $192,389, as compared to operating expenses totaling $77,887 from inception
to December 31, 2011. The increase is due primarily to increased costs for auditors and attorneys relative to the merger and increased
exploration costs at our Star Mountain project.
Operating
Loss
Our
operating loss during the six months ended June 30, 2012 totaled $192,389, as compared to an operating loss of $54,120 from inception
to December 31, 2011. The reduced operating loss is due primarily to a reduced level of activity at our Ogden Bay Minerals project
site.
Interest
Expense
Interest
Expense for the six months ended June 30, 2012 totaled $7,647, as compared to interest expense of $138 from inception to December
31, 2011.
Net
Loss
Our
net loss during the six months ended June 30, 2012 totaled $200,036, as compared to a net loss of $54,258 from inception to December
31, 2011.
Liquidity
and Capital Resources
We
are reliant upon shareholder loans, and equity private placements to fund operations.
We
had $15,927 and $6,991 of cash as of June 30, 2012 and December 31, 2011, respectively.
Net
cash used in operating activities is primarily attributable amounts paid for exploration and development costs (which were expensed
as incurred), accounting and legal services, and corporate organizational fees. We do not expect to have positive cash flow from
operations until late 2012 and give no assurance that such will occur.
Cash
used in investing activities is attributable to purchase of transportation equipment and mineral rights.
Net
cash provided by financing activities relates to advances received from its shareholders and an unrelated party. On June 11, 2012,
the Company issued a non-interest bearing convertible promissory note in the principal amount of $155,000 to an unrelated party
in connection with advances previously received. Prior to December 31, 2012, any unpaid balance of the convertible note may be
converted at the option of the investor or the Company into common stock of the post-merger company at a rate of one common share
for every two dollars of loan reduction.
No
shares were sold and no options or warrants have been issued from inception through June 30, 2012.
As
noted above, we believe that we do not have sufficient liquidity to satisfy our cash requirements for the next twelve months,
which will require us to raise additional equity and / or debt capital in order to fully implement our business strategy. We intend
to develop a significant capital investment program to scale our production capacity, which will require us to raise additional
debt or equity capital. Any issuance of equity securities will result in dilution to our stockholders. Issuance of debt or convertible
securities could also involve substantial dilution to our stockholders, or operational and financial covenants that might inhibit
our ability to follow our business plan. Additional financing may not be available in amounts or on terms acceptable to us or
at all. If we are unable to obtain additional financing, we may be required to reduce the scope of, delay or eliminate some or
all of our planned exploration and development activities, which could harm our financial conditions and operating results.
Related
Party Transactions
At
June 30, 2012 and December 31, 2011, we had outstanding net advances and loans from related parties of $61,469 and $7,725, respectively.
Off-Balance
Sheet Arrangements
There
are no 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 or expenses, results of operations, liquidity, capital expenditures or capital resources
that is material to investors.
Controls
and Procedures -
At this time, we plan to use the controls and procedures used by Jameson Stanford and to implement changes
as needed after consummation of the Merger.
Critical
Accounting Policies and Estimates
Mineral
rights
. The costs of acquiring mineral rights are considered tangible assets. Significant acquisition payments are capitalized.
If a mineable ore body or other material is discovered, such costs are amortized when production begins using the units-of-production
method. If no mineable ore body is discovered or such rights are otherwise determined to have diminished value, such costs are
expensed in the period in which the determination is made.
General,
administrative and holding costs to maintain unproven claims are expensed as incurred.
Exploration
costs are charged to expense as incurred. Costs to identify new mineral resources, to evaluate potential resources and to convert
mineral resources into proven and probable reserves are considered exploration costs.
Going
Concern
The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the
financial statements, the Company has experienced a loss during its initial period of operations and does not currently have sufficient
resources to accomplish its objectives during the next twelve months. These conditions raise substantial doubt about the Company’s
ability to continue as a going concern. The financial statements do not include adjustments relating to the recoverability of
assets and classification of liabilities that might be necessary should it be unable to continue in operation. Our present plans,
the realization of which cannot be assured, to overcome these difficulties include, but are not limited to, the continuing effort
to raise capital in public and private markets.
ITEM
3. PROPERTIES
Our
business office is located at 10785 West Twain Avenue, Suite 200, Las Vegas, Nevada 89135. Our phone number is 702-933-0808. Our
business office is provided at no charge and is a temporary arrangement while we search for more permanent office space. There
is no rental agreement for the use of this office. If rent were charged for this space, the amount would not be material but would
be expensed.
ITEM
4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The
following table sets forth certain information, as of October 29, 2012 with respect to the beneficial ownership of the outstanding
common stock by (i) any holder of more than five percent, (ii) each of our executive officers and directors, and (iii) our directors
and executive officers as a group. The information relating to the ownership interests of such shareholders is provided after
giving effect to the Merger.
Name
and
Address
of
Beneficial
Owner
(1)
|
|
Amount
and Nature of
Beneficial Ownership
(1)
|
|
|
Percent
of
Class
(1)
|
|
|
|
|
Common
stock
|
|
|
|
Common
stock
|
|
Michael Stanford, CEO, President, and Director
|
|
|
25,000,000
- direct
|
|
|
|
79.9
|
%
|
Michael Smith, former President and CEO
|
|
|
0
|
|
|
|
0.0
|
%
|
Robbie Chidester, EVP, CFO, Secretary & Treasurer
|
|
|
0
|
|
|
|
0.0
|
%
|
Michael Christiansen, former EVP, CFO, Secretary & Treasurer
|
|
|
0
|
|
|
|
0.0
|
%
|
Summit Capital USA, Inc. (2)
|
|
|
1,996,666
- direct
|
|
|
|
6.38
|
%
|
|
|
|
|
|
|
|
|
|
Directors and Officers as a group
|
|
|
25,000,000
|
|
|
|
79.9
|
%
|
(1)
Based on an aggregate of 31,300,000 common shares outstanding as of October 29, 2012. The address for each officer and/or
director is 10785 West Twain Avenue, Suite 200, Las Vegas, Nevada 89135, the address of the Company.
(2)
The mailing address for Summit Capital USA, Inc. is 605 W. Knox Road, Suite 202, Tempe, AZ 85284. The beneficially owners
of Summit Capital are 50% owned by Summit Capital Corp, 2 Anthony Henday Center, 4914-55 St., Red Deer, AB, Canada T4N 2J4 (Summit
Capital Corp is beneficially owned by Gregg C.E. Johnson and Cheryl L. Mc Robbie-Johnson); 25% owned by Gregg C.E. Johnson, 6081
W. Park Ave, Chandler, AZ 85226; and 25% owned by Thomas P. Madden, 1192 W. Sunrise Place, Chandler, AZ 85248.
ITEM
5. DIRECTORS AND EXECUTIVE OFFICERS.
The
following table sets forth the names and ages of each of the persons designated to become members of the Board of Directors and
Executive Officers effective upon closing of the Merger
Name
|
|
Age
|
|
Positions
and Offices to be Held
|
Michael Stanford
|
|
46
|
|
CEO, President, and Director
|
Robbie Chidester
|
|
56
|
|
Executive Vice President, Chief Financial Officer, Secretary and Treasurer
|
The
directors named above will serve until the first annual meeting of our stockholders following completion of the Merger or until
their respective successors have been appointed and duly qualified. Thereafter, directors will be elected for one-year terms at
the annual stockholders’ meeting. Officers will hold their positions at the pleasure of the board of directors, absent any
employment agreement. There is no arrangement or understanding between any of the directors or officers and any other person pursuant
to which any director or officer was or is to be selected as a director or officer, and there is no arrangement, plan or understanding
as to whether non-management shareholders will exercise their voting rights to continue to elect the current directors to our
board. There are also no arrangements, agreements or understandings between non-management shareholders and management under which
non-management shareholders may directly or indirectly participate in or influence the management of our affairs.
Michael
Stanford
, 46, President and Chief Executive Officer, Director. Michael Stanford joined Jameson Stanford Resources Corporation
in May 2012 and serves as President, Chief Executive Officer and Director. Mr. Stanford also serves as President, Chief Executive
Officer and Director of Bolcán Mining Corporation. Mr. Stanford has more than 20 years of experience in the mining and
metallurgy industries as an owner and operator of companies specializing in the exploration, development, recovery, refining and
marketing of precious metals from mined mineral ore bodies. Mr. Stanford has managed and directed over 2,000 employees and is
highly experienced in administering environmental controls and process systems in mining and metallurgy operations.
From
1997 to 2008, Mr. Stanford managed and directed projects under contract with Rio Tinto and Kennecott Utah Copper. From 1995 to
2012, Mr. Stanford managed projects under contract with Chubu Electric Power Company, Techno Chubu Company, Kiewit Western Corporation,
United States Department of Agriculture Natural Resource Conservation Service (NRCS), United States Bureau of Land Management
(BLM), Utah Department of Natural Resources Wildlife Division (DNR). From 1989 to 2012, Mr. Stanford operated two commercial analytic
laboratories as Stanford Laboratories.
Robbie
Chidester
, CPA, 56, Executive Vice President, Chief Financial Officer, Secretary. Mr. Chidester joined Jameson Stanford Resources
Corporation in July 2012. Prior to joining the Company, he provided outsourced accounting, financial management and advisory services
to various clients. Mr. Chidester has spent over 20 years as VP Finance, Chief Financial Officer, Board Member and Advisor. Working
the past six years as an outsourced or interim financial officer, Mr. Chidester has provided financial management and advisory
services to over 20 emerging businesses. He provided such services for CFO Solutions, LC from 2006 to 2008 and has worked for
CFO Advantage Consulting, LC from 2008 to 2012. Mr. Chidester has personally assisted in the placement of over $260M in private
debt and equity funding. While working from 1987 to 2006 as a fulltime financial officer for various emerging companies, ranging
in size from startup to over $160M in revenue, he supervised financial teams ranging in size from small, hands-on groups to a
diverse, international team of over 40 professionals located on four continents. Beginning his career in 1981 with the international
audit, tax and advisory firm KPMG, LLC, Mr. Chidester establishing himself as a specialist in corporate compliance, public reporting,
M&A/IPO support, due diligence, business transformation/turn-around services and management consulting. He has provided financial
services to a vast array of clients, including successful companies in the exploration, extraction and processing of natural resources.
He is a licensed Certified Public Accountant. Mr. Chidester graduated with an honors Bachelors Degree in Accounting from the University
of Utah.
All
executive officers are elected by the Board and hold office until the next Annual Meeting of stockholders and until their successors
are elected and qualify.
ITEM
6. EXECUTIVE COMPENSATION.
The
following table provides certain information for the fiscal years ended December 31, 2011 and 2010 concerning compensation earned
for services rendered in all capacities by our named executive officers during the fiscal years ended December 31, 2011 and 2010
.
SUMMARY
COMPENSATION TABLE
|
Name and
principal position
|
|
Year
|
|
|
Salary
|
|
|
Bonus
|
|
|
Stock
Awards
|
|
|
Option
Awards
|
|
|
Non-Equity
Incentive Plan Compensation
|
|
|
Nonqualified
Deferred Compensation Earnings
|
|
|
All
Other Compensation
|
|
|
Total
|
|
Michael Stanford, Director, President and CEO
|
|
|
2011
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
2010
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Robbie Chidester, EVP, CFO, Secretary & Treasurer
|
|
|
2011
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
2010
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Michael Christiansen, former EVP, CFO, Secretary & Treasurer
|
|
|
2011
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
2010
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Michael Smith, former CEO
|
|
|
2011
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
|
2010
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
Employment
Agreements
We
do not have any employment contracts with our executive officers.
OUTSTANDING
EQUITY AWARDS AT DECEMBER 31, 2011
|
OPTION
AWARDS
|
|
STOCK
AWARDS
|
Name
|
|
Number
of Securities Underlying Unexercised Options
(#)
Exercisable
|
Number
of Securities Underlying Unexercised Options
(#)
Unexercisable
|
|
Equity
Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options
(#)
|
|
Option
Exercise Price
($)
|
|
Option
Expiration Date
|
|
Number
of Shares or Units of Stock That Have Not Vested
(#)
|
|
Market
Value of Shares or Units of Stock That Have Not Vested
($)
|
|
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)
|
|
Equity
Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
(#)
|
Michael
Stanford
|
|
NONE
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
Michael
Christiansen
|
|
NONE
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
Michael
Smith
|
|
NONE
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
Robbie
Chidester
|
|
NONE
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
|
NONE
|
Discussion
of Director Compensation
The
Company did not pay any director compensation during the fiscal year ended December 31, 2011. The Company may begin to compensate
its directors at some time in the future.
ITEM
7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
At
June 30, 2012 and December 31, 2011, we had outstanding net advances from related parties of $61,469 and $7,725, respectively.
ITEM
8. LEGAL PROCEEDINGS.
None
ITEM
9. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
Our
common stock is quoted on the OTCQB under the symbol “JMSN”.
Such trading of our common
stock is limited and sporadic. Prior to June 29, 2012, our symbol was “MYCOD”.
The
following table reflects the high and low bid information for our common stock for each fiscal quarter during the fiscal year
ended December 31, 2011 and 2010. The bid information was obtained from the OTCQB and reflects inter-dealer prices, without retail
mark-up, markdown or commission, and may not necessarily represent actual transactions.
Quarter
Ended
|
|
Bid
High
|
|
|
Bid
Low
|
|
Fiscal Year 2011
|
December 31, 2011
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
September 30, 2011
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
June 30, 2011
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
March 31, 2011
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
|
|
|
|
|
|
|
|
|
Fiscal year 2010
|
December 31, 2010
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
September 30, 2010
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
June 30, 2010
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
March 31, 2010
|
|
$
|
0.00
|
|
|
$
|
0.00
|
|
We
have never declared or paid cash dividends on our common stock. We currently intend to retain all available funds and any future
earnings for use in the operation and expansion of our business and do not anticipate paying any cash dividends in the foreseeable
future.
ITEM
10. RECENT SALES OF UNREGISTERED SECURITIES.
See
Item 3.02 of this Form 8-K, which describes sales of unregistered securities in connection with the Merger.
ITEM
11. DESCRIPTION OF REGISTRANT’S SECURITIES TO BE REGISTERED.
Our
authorized capital stock consists of 350,000,000 shares of common stock
, $0.001 par value per share
.
As of October 29, 2012, there were 31,300,000 outstanding shares of common stock.
Common
Stock
Subject
to preferences that may be applicable to any preferred stock outstanding at the time, the holders of c
ommon
stock
are entitled to receive dividends out of legally available assets at such times and in such amounts as our Board
of Directors may from time to time determine. Each stockholder is entitled to one vote for each share of c
ommon
stock
held on all matters submitted to a vote of stockholders. Cumulative voting for the election of directors is not authorized.
Our
c
ommon stock
is not subject to conversion or redemption and holders of c
ommon
stock
are not entitled to preemptive rights. Upon the liquidation, dissolution or winding up of the Company, the remaining
assets legally available for distribution to stockholders, after payment of claims or creditors and payment of liquidation preferences,
if any, on outstanding preferred stock, are distributable ratably among the holders of c
ommon stock
and any participating preferred stock outstanding at that time. Each outstanding share of c
ommon
stock
is fully paid and non-assessable.
Warrants
None
Options
None
ITEM
12. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Neither
our Articles of Incorporation nor Bylaws prevent us from indemnifying our officers, directors and agents to the extent permitted
under the Nevada Revised Statute (“NRS”). NRS Section 78.7502, provides that a corporation may indemnify any director,
officer, employee or agent of a corporation against expenses, including attorneys’ fees, actually and reasonably incurred
by him in connection with any the defense to the extent that a director, officer, employee or agent of a corporation has been
successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Section 78.7502(1) or 78.7502(2),
or in defense of any claim, issue or matter therein.
NRS
78.7502(1) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except
an action by or in the right of the corporation, by reason of the fact that he is or was a director, officer, employee or agent
of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys’ fees, judgments,
fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding
if he: (a) is not liable pursuant to NRS 78.138; or (b) acted in good faith and in a manner which he reasonably believed to be
in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful.
NRS
Section 78.7502(2) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor
by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust
or other enterprise against expenses, including amounts paid in settlement and attorneys’ fees actually and reasonably incurred
by him in connection with the defense or settlement of the action or suit if he: (a) is not liable pursuant to NRS 78.138; or
(b) acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation.
Indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals there from, to be liable to the corporation or for amounts paid in settlement to
the corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent
jurisdiction determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably
entitled to indemnity for such expenses as the court deems proper.
NRS
Section 78.747 provides that except as otherwise provided by specific statute, no director or officer of a corporation is individually
liable for a debt or liability of the corporation, unless the director or officer acts as the alter ego of the corporation. The
court as a matter of law must determine the question of whether a director or officer acts as the alter ego of a corporation.
Insofar as indemnification for
liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the
foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable.
ITEM
13. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
See
Item 9.01 of this report on Form 8-K.
ITEM
15. FINANCIAL STATEMENTS AND EXHIBITS.
See
Item 9.01 of this report on Form 8-K.
Item
3.02 Unregistered Sales of Equity Securities.
On
October 29, 2012, we issued 25,000
,000 shares of our common stock to the shareholders of Bolcán
i
n connection with the Merger.
Such
issuances were conducted pursuant to Section 4(2) of the Securities Act, as amended, and Regulation D promulgated thereunder.
Item 4.01 – Changes in Registrant’s
Certifying Accountant
(a) On November
27, 2012, we, by our board of directors, dismissed Silberstein Ungar, PLLC (“Silberstein”) as our independent registered
public accounting firm. Silberstein issued a report on our consolidated financial statements for the fiscal year ended December
31, 2011 and 2010 and for the period from June 2, 2009 (date of inception) through December 31, 2011. Silberstein’s report
on our consolidated financial statements for these periods was qualified as to uncertainty in that the report indicated that
the
Company has negative working capital, has not yet received revenue from sales of products or services, and has incurred losses
from operations and that these factors raise substantial doubt about the Company’s ability to continue as a going concern.
Through the two most recent fiscal years
and through the date of termination of Silberstein, we did not have any disagreements with Silberstein on any matter of accounting
principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to
Silberstein’s satisfaction, would have caused them to make reference thereto in their reports on our financial statements.
We have provided Silberstein with a copy of
the disclosures in this Form 8-K/A (Amendment No. 2 ) prior to the filing of these disclosures and has requested that Silberstein
furnish a letter addressed to the Securities and Exchange Commission stating whether or not Silberstein agrees with the statements
made herein above and, if not, stating in which respects Silberstein does not agree. Silberstein’s letter is attached to
this Form 8-K/A (Amendment No. 2 ) as Exhibit 16.1.
(b) On August
27, 2012, with the approval of our board of directors, Bolcan retained retained Mantyla McReynolds, LLC to be our independent
registered public accounting firm, which retention, we confirmed, on November 20, 2012.
During the two most recent fiscal years and
the interim period preceding the engagement of Mantyla McReynolds, LLC, we have not consulted Mantyla McReynolds, LLC regarding:
(i) the application of accounting principles to any specified transaction, either completed or proposed, (ii) the type of audit
opinion that might be rendered on our financial statements, or (iii) any matter that was either the subject of a disagreement
(as defined in Item 304(a)(1)(iv) of Regulation S-K) or a reportable event (as defined in Item 304(a)(1)(v)).
Item
5.01 Changes in Control of Registrant.
See
Item 2.01 of this report.
Item
5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers
Effective
as of the closing of the Merger, Michael F. Smith, our CEO and a Director will resign from all positions with the Company and
he shall return for cancellation 52,500,000 shares of the Company’s common stock held in his name.
Effective
October 29, 2012, Michael Stanford, was appointed our CEO and will also retain his current position as President.
Effective
October 29, 2012, Michael Christiansen was terminated as Chief Financial Officer as his work for the company was completed. There
were no disagreements with Mr. Christiansen.
Effective
October 29, 2012 Robbie Chidester was appointed Executive Vice President, Chief Financial Officer, Secretary, and Treasurer.
Item
5.06 Change In Shell Company Status.
As
described in Item 2.01 of this report, on October 29, 2012 the Merger was completed. As a result of this transaction, we are no
longer a shell company as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended.
Item
9.01 Financial Statements and Exhibits.
(a)
Financial statements of businesses acquired. Bolcán Mining Corporation: (i) audited financial statements as of December
31, 2011 and 2010 and for the year ended December 31, 2011 and for the period from October 12, 2010 (inception) through December
31, 2011. (ii) unaudited financial statements as of June 30, 2012 and for the six months ended June 30, 2012 and 2011 and for
the period from October 12, 2010 (inception) through June 30, 2012.
(b)
Pro forma financial information. In accordance with Item 9.01(b), unaudited pro forma consolidated financial statements of Jameson
Stanford Resources Corporation and Bolcán Mining Corporation as of December 31, 2011 and for the six months ended June
30, 2012.
(c)
Shell Company Transaction
(d)
Exhibits
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Date:
November 30 , 2012
JAMESON
STANFORD RESOURCES CORPORATION
By:
|
/s/
Michael Stanford
|
|
Title:
|
Chief Executive Officer
|
|
EXHIBIT
INDEX
Exhibit
Number
|
|
Description
of Exhibit
|
2.1
|
|
Acquisition Agreement and Plan
of Merger dated May 7, 2012*
|
2.1(a)
|
|
Extension Agreement dated July
24, 2012
*
|
2.1(b)
|
|
Extension Agreement dated October
24, 2012
**
|
3.1
|
|
Articles of Incorporation Bolcan
Mining Corporation dated April 11, 2012*
|
3.2
|
|
Bylaws of Bolcan Mining Corporation
*
|
10.1
|
|
Asset Purchase Agreement between
The Bolcán Group LLC and Bolcán Mining Corporation effective June 30, 2012
*
|
16.1
|
|
Correspondence from Silberstein Ungar, PLLC dated November 30, 2012
|
* Previously filed with our Form 8-K on November 2, 2012.
** Previously filed with our Form 8-K on November 28, 2012.
THE BOLCÁN
GROUP, L.L.C.
(ANEXPLORATION
STAGE COMPANY)
FINANCIAL
STATEMENTS AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
DECEMBER
31, 2011 AND 2010
THE
BOLCÁN GROUP, L.L.C.
(ANEXPLORATION
STAGE COMPANY)
INDEX
TO FINANCIAL STATEMENTS
|
|
Page
|
Report
of Independent Registered Public Accounting Firm
|
|
F-1
|
|
|
|
Financial
statements:
|
|
|
Balance
sheets
|
|
F-2
|
Statements
of operations
|
|
F-3
|
Statements
of member’s deficit
|
|
F-4
|
Statements
of cash flows
|
|
F-5
|
Notes to
the financial statements
|
|
F-6
|
THE
BOLCÁN GROUP, L.L.C.
(ANEXPLORATION
STAGE COMPANY)
Report
of Independent Registered Public Accounting Firm
The
Ownership and Management
The
Bolcán Group, L.L.C.
We
have audited the accompanying balance sheets of The Bolcán Group, L.L.C. (An Exploration Stage Company) as of December
31, 2011 and 2010 and the related statements of operations, members’ deficit, and cash flows for the year ended December
31, 2011 and for the period from inception [October 12, 2010] through December 31, 2011. These financial statements are the responsibility
of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We
conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. The Company has determined that it is not required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit
also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.
In
our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of The
Bolcán Group, L.L.C. as of December 31, 2011 and 2010 and the results of operations and cash flows for the year ended December
31, 2011 and for the period from inception[October 12, 2010] through December 31, 2011, in conformity with accounting principles
generally accepted in the United States of America.
The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed
in Note 2 to the financial statements, the Company has incurred significant losses since inception. The Company has not established
operations with consistent revenue streams and has a working capital deficit. These factors raise substantial doubt about its
ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The
financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/
Mantyla McReynolds, LLC
|
|
Mantyla
McReynolds, LLC
|
|
Salt
Lake City, Utah
|
|
October
5, 2012
|
|
The Bolcán Group, L.L.C.
(AN EXPLORATION STAGE COMPANY)
Balance Sheets
|
|
December
31, 2011
|
|
|
December
31, 2010
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash
|
|
$
|
6,991
|
|
|
$
|
-
|
|
Total Current
Assets
|
|
|
6,991
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Property and equipment,
net
|
|
|
32,354
|
|
|
|
-
|
|
Total Assets
|
|
$
|
39,345
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND MEMBER’S
DEFICIT
|
|
|
|
|
|
|
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
Accounts payable and accrued
expenses
|
|
$
|
778
|
|
|
$
|
-
|
|
Other advances
|
|
|
85,000
|
|
|
|
-
|
|
Total Current
Liabilities
|
|
|
85,778
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Long-term Liabilities
|
|
|
|
|
|
|
|
|
Advances from Majority
Owner
|
|
|
7,725
|
|
|
|
-
|
|
Total Liabilities
|
|
|
93,503
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Member’s Deficit
|
|
|
|
|
|
|
|
|
Member’s contributions
|
|
|
100
|
|
|
|
-
|
|
Deficit accumulated
during exploration stage
|
|
|
(54,258
|
)
|
|
|
-
|
|
Total Member’s
Deficit
|
|
|
(54,158
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
and Member’s Deficit
|
|
$
|
39,345
|
|
|
$
|
-
|
|
See notes to financial
statements
The Bolcán Group, L.L.C.
(AN EXPLORATION STAGE COMPANY)
Statements of Operations
|
|
|
|
|
Period
from
|
|
|
|
|
|
|
Inception
|
|
|
|
12 Months
Ended
|
|
|
(October
12, 2010)
|
|
|
|
December 31, 2011
|
|
|
to December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
89,994
|
|
|
$
|
89,994
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue
|
|
|
66,227
|
|
|
|
66,227
|
|
Gross profit
|
|
|
23,767
|
|
|
|
23,767
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
Exploration and
development costs
|
|
|
3,133
|
|
|
|
3,133
|
|
Exploration and
development costs - related party
|
|
|
39,650
|
|
|
|
39,650
|
|
General and administrative
|
|
|
7,604
|
|
|
|
7,604
|
|
General and administrative
- related party
|
|
|
27,500
|
|
|
|
27,500
|
|
|
|
|
77,887
|
|
|
|
77,887
|
|
|
|
|
|
|
|
|
|
|
Operating loss
|
|
|
(54,120
|
)
|
|
|
(54,120
|
)
|
|
|
|
|
|
|
|
|
|
Other income (expenses)
|
|
|
|
|
|
|
|
|
Interest
expense, related parties
|
|
|
(138
|
)
|
|
|
(138
|
)
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(54,258
|
)
|
|
$
|
(54,258
|
)
|
See notes
to financial statements
The Bolcán Group, L.L.C.
(AN EXPLORATION STAGE COMPANY)
Statements of Member’s Deficit
Period from Inception (October 12, 2010)
to December 31, 2011
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
Total
|
|
|
|
Member’s
|
|
|
during
the
|
|
|
Member’s
|
|
|
|
Contributions
|
|
|
Exploration
Stage
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
Net loss from
inception (October 12, 2010) to December 31, 2010
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances, December 31, 2010
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Member’s contributions
|
|
|
100
|
|
|
|
-
|
|
|
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for 12 Months ended December
31, 2011
|
|
|
-
|
|
|
|
(54,258
|
)
|
|
|
(54,258
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances, December 31, 2011
|
|
$
|
100
|
|
|
$
|
(54,258
|
)
|
|
$
|
(54,158
|
)
|
See notes to financial
statements
The Bolcán Group, L.L.C.
(AN EXPLORATION STAGE COMPANY)
Statements of Cash Flows
|
|
|
|
|
Period
from
|
|
|
|
|
|
|
Inception
|
|
|
|
12 Months
ended
|
|
|
(October
12, 2010)
|
|
|
|
December 31, 2011
|
|
|
to December 31, 2011
|
|
|
|
|
|
|
|
|
Operating activities:
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(54,258
|
)
|
|
$
|
(54,258
|
)
|
Adjustments to reconcile
net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
1,047
|
|
|
|
1,047
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
778
|
|
|
|
778
|
|
Accrued interest
- related party
|
|
|
138
|
|
|
|
138
|
|
Net cash used
in operating activities
|
|
|
(52,295
|
)
|
|
|
(52,295
|
)
|
|
|
|
|
|
|
|
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
Acquisition of property
and equipment
|
|
|
(33,401
|
)
|
|
|
(33,401
|
)
|
Cash used in investing
activities
|
|
|
(33,401
|
)
|
|
|
(33,401
|
)
|
|
|
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
|
|
|
|
Advances from Majority
Owner
|
|
|
7,587
|
|
|
|
7,587
|
|
Other advances
|
|
|
85,000
|
|
|
|
85,000
|
|
Member’s contributions
|
|
|
100
|
|
|
|
100
|
|
Cash provided
by financing activities
|
|
|
92,687
|
|
|
|
92,687
|
|
|
|
|
|
|
|
|
|
|
Net increase in cash
|
|
|
6,991
|
|
|
|
6,991
|
|
Cash, beginning of period
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Cash, end of period
|
|
$
|
6,991
|
|
|
$
|
6,991
|
|
|
|
|
|
|
|
|
|
|
Supplemental information:
|
|
|
|
|
|
|
|
|
Cash paid for:
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
-
|
|
|
$
|
-
|
|
Taxes
|
|
$
|
-
|
|
|
$
|
-
|
|
See notes to financial statements
NOTE
1 – ORGANIZATION AND NATURE OF BUSINESS
The
Bolcán Group L.L.C. (“Bolcán Group”) was formed on October 12, 2010.
The
operating activities of the Bolcán Group were inconsequential until October 2011 and consisted primarily of historical
site research and minerals testing performed by Michael Stanford, the sole member of the Bolcán Group (the “Majority
Owner”). The Majority Owner has other mining interests and provides services to the mining industry that are not part of
the Company.
The
Company was formed to pursue the development of certainmining claims,mineral leases and excavation rights (collectively referred
to herein as “mineral rights”) for mining projects located in (a) Star Mining District in Beaver County, Utah,(b)
Spor Mountain Mining District in Juab County, Utah, and (c) Ogden Bay Wildlife Management Area in Weber County, Utah.
NOTE
2 – GOING CONCERN
The
Company is an exploration stage enterprise as defined under generally accepted accounting principles in the United States (“GAAP”).
The financial statements have been prepared on a going concern basis, which assumes the Company will be able to realize its assets
and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred losses since
inception resulting in a deficit accumulated during exploration stage of $54,258 as of December 31, 2011, and further losses are
anticipated in the development of its business. The Company’s ability to continue as a going concern is dependent upon the
Company generating profitable operations and cash flows in the near-term future and/or to obtain the necessary financing to meet
its obligations and repay its liabilities arising from normal business operations. Management plans to finance the Company’s
operating costs as necessary over the next twelve months with advances from owners and directors, and the private placement of
the Company’s equity ownership. If management is unsuccessful in these efforts, discontinuance of operations is possible.
The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE
3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of Accounting and Presentation
Management
has elected not to measure any of its eligible financial instruments or other items at fair value. Accordingly, except as required
by GAAP and disclosed herein, the Company continues to measure all of its assets and liabilities at historical cost.
The
Company is in the exploration stage and its primary activities to date have included conducting research and exploration, developing
markets for its products, securing strategic alliances, recruiting personnel and obtaining financing. As an exploration stage
enterprise, the Company is required to present cumulative amounts from inception (October 12, 2010) through the latest period
presented herein.
Property
and Equipment
Property
and equipment consists of a vehicle that is stated at cost of $33,400, less accumulated depreciation of $1,047 at December 31,
2011, computed using the straight-line method over the estimated 5 year useful life of the asset.
THE
BOLCÁN GROUP, L.L.C.
(ANEXPLORATION
STAGE COMPANY)
Revenue
The
Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.
The Company’s only revenues to date consist of a dredging agreement for the Weber River for which the earnings process was
complete as of December 31, 2011.
Income
Taxes
Since
the Bolcán Group elected to be taxed as a partnership, its net losses are “passed-through” to and are included
in the personal tax returns of the Majority Owner.
Use
of Estimates
The
preparation of financial statements in conformity with GAA Prequires management to make estimates and assumptions that affect
reported amounts. Actual results could differ from those estimates.
NOTE
4 – TRANSACTIONS WITH MAJORITY OWNER AND OFFICER
The
Majority Owner has made periodic advances to the Company to fund operations, which are unsecured and payable on demand after June
30, 2013, with interest at the rate of 12% per annum, compounded daily. The outstanding advances total $7,715, including accrued
interest of $138 as of December 31, 2011.
The
Company has contracted for minerals testing, laboratory services, project management and materials supply from several entities
that are operated by common management or are otherwise controlled by the Majority Owner. Payments to such related parties totaled
$67,150 for the period ended December 31, 2011.
NOTE
5 – OTHER ADVANCES
In
connection with a memorandum of understanding dated October 27, 2011, the Company received certain cash advances from an unrelated
party during the period ended December 31, 2011. These advances are unsecured, do not bear interest and are payable on demand.
Also see convertible note in Note 7. The outstanding advances total $85,000 as of December 31, 2011.
NOTE
6 – SIGNIFICANT CONCENTRATIONS
The
Company’s only revenues to date consist of a dredging agreement for the Weber River for which the earnings process was complete
as of December 31, 2011.
NOTE
7 – SUBSEQUENT EVENTS
Asset
Purchase
Effective
June 30, 2012, Michael Stanford, then the sole member of the Bolcán Group (the “Majority Owner”), caused the
Bolcán Group to transfer all of its assets and certain known liabilities to Bolcán Mining Corporation resulting
in a combination of the two companies. The transaction is being accounted for in accordance with ASC 805-50 as a business combination
between entities under common control. Going forward, the Company will be taxed as a corporation. Bolcán Mining Corporation
has 1,000,000 common shares authorized with a par value of $0.001. The combined entity will be doing business as Bolcán
Mining Corporation.
THE
BOLCÁN GROUP, L.L.C.
(AN
EXPLORATION STAGE COMPANY)
Mineral
Rights
On
April 23, 2012, the Company acquired certain lode mining claims and mineral leases related to the Star Mining District and Spor
Mountain Mining District projects.
Star
Mountain - On April 23, 2012, the Company paid and capitalized $22,113 to acquire 117 unpatented lode mining claims from the Bureau
of Land Management related to the Star Mountain project near Milford, Utah. In addition, on May 1, 2012, the Company entered into
a mineral lease agreement with the State of Utah for approximately 1,400 acres that are contiguous with the Star Mountain lode
mining claims. The initial costs incurred and capitalized in connection with obtaining the lease was $1,599. Collectively, the
Star Mountain claims and lease encompass a total area of approximately 3,740 acres.
The
lease has an initial term of 10 years, subject to certain extension provisions. The future minimum annual rental commitment is
$1.00 per acre (or $1,408). The lease also provides for a minimum annual royalty payment of $4,224 beginning in the 11th year
of the lease (if extended), and requires contingent production royalty payments based on 4% to 8% of the gross value (as defined
in the lease) of non-fissionable and fissionable metalifferous minerals, respectively, extracted from the leased area.
Spor
Mountain - On May 1, 2012, the Company entered into a mineral lease agreement with the State of Utah for approximately 1,920 acres
related to the Dugway Minerals project near Delta, Utah. The initial costs incurred and capitalized in connection with obtaining
the lease were $2,152.
The
lease has an initial term of 10 years, subject to certain extension provisions. The future minimum annual rental commitment is
$1.00 per acre (or $1,918). The lease also provides for a minimum annual royalty payment of $5,754 beginning in the 11th year
of the lease, and requires contingent production royalty payments based on 4% to 8% of the gross value (as defined in the lease)
of non-fissionable and fissionable metalifferous minerals, respectively, extracted from the leased area.
Loan
On
May 11, 2012, an individual loaned Bolcán Mining Corporation$42,000. The loan is guaranteed by the Majority Owner, bears
interest at 12% per annum, and has been extended to a due date of August 24, 2012. As the loan has passed its due date, it is
in default.
Convertible
Note
On
June 11, 2012, the Company issued a non-interest bearing convertible promissory note to the unrelated party in connection with
advances previously received and additional advances that may be advanced from time to time. Prior to January 1, 2013, the note
is due on demand; however, the unpaid balance is convertible at the option of the unrelated party or the Company into shares of
common stock of any post-merger company shares at the rate of one share of common stock for every two dollars of loan reduction.
All advances under this facility are shown as a current liability in the accompanying financial statements. Subsequent to December
31, 2011, an additional $100,000 was advanced.
Plan
of Merger
Effective
May 7, 2012, the Company entered into an Agreement and Plan of Merger with Jameson Stanford Resources Corporation, (“Jameson
Stanford”), and JSR Sub Co, (“JSR”), both unrelated parties, with a required closing date of May 23, 2012. Because
the transaction did not close on May 23, 2012, this agreement has expired.
BOLCÁN
MINING CORPORA
T
ION AND
S
U
BSID
I
A
RY
(AN
EX
PL
ORATION
STAGE COMPANY)
COND
E
N
S
ED
CON
S
OLIDAT
E
D FINANCIAL S
T
A
T
EMEN
T
S
JUNE
30, 2012
INDEX
T
O
FIN
A
NC
IA
L
STATE
M
ENTS
|
Page
|
|
|
Consolidated
financial
stat
e
ments
:
|
|
Condensed
Consolidated
B
alance
sheets
|
F-2
|
Condensed
Consolidated
S
tateme
n
ts
of
operations
|
F-3
|
Condensed
Consolidated
Statements
of
cash
flows
|
F-4
|
Notes
to
the
condensed
co
n
solidated
financial
statements
|
F-5
|
Bo
l
cá
n
M
i
n
i
n
g
Cor
p
orat
i
o
n
(AN
E
X
PLORATION STAGE COMPANY)
Condensed
Consolidated Balance Sheets
(Unaudited)
|
|
June
30, 2012
|
|
|
December 31, 2011
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash
|
|
$
|
15,927
|
|
|
$
|
6,991
|
|
Total Current Assets
|
|
|
15,927
|
|
|
|
6,991
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
|
29,213
|
|
|
|
32,354
|
|
Mineral rights
|
|
|
25,869
|
|
|
|
-
|
|
Total Assets
|
|
$
|
71,009
|
|
|
$
|
39,345
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
|
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
Accounts payable and accrued expenses
|
|
$
|
52,646
|
|
|
$
|
778
|
|
Accrued compensation
|
|
|
50,000
|
|
|
|
-
|
|
Convertible debt
|
|
|
155,000
|
|
|
|
85,000
|
|
Loan from related party
|
|
|
42,693
|
|
|
|
-
|
|
Total Current Liabilities
|
|
|
300,339
|
|
|
|
85,778
|
|
|
|
|
|
|
|
|
|
|
Long-term liabilities
|
|
|
|
|
|
|
|
|
Advances from majority owner
|
|
|
18,776
|
|
|
|
7,725
|
|
Total Liabilities
|
|
|
319,115
|
|
|
|
93,503
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ Deficit
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par value, 1,000,000 shares authorized, issued
and outstanding
|
|
|
1,000
|
|
|
|
-
|
|
Additional paid in capital / Member’s contribution
|
|
|
5,188
|
|
|
|
100
|
|
Deficit accumulated during exploration stage
|
|
|
(254,294
|
)
|
|
|
(54,258
|
)
|
Total Stockholders’ Deficit
|
|
|
(248,106
|
)
|
|
|
(54,158
|
)
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Stockholders’ Deficit
|
|
$
|
71,009
|
|
|
$
|
39,345
|
|
S
e
e
n
o
t
e
s
t
o
c
o
nd
e
n
s
e
d
c
o
n
s
ol
idat
e
d
f
inancia
l
s
tat
e
m
e
nts
Bo
l
cá
n
M
i
n
i
n
g
Cor
p
orat
i
o
n
(AN
E
X
PLORATION STAGE COMPANY)
Condensed
Consolidated State
m
ents of Operations
(Unaudited)
|
|
Six
Months
ended
June 30, 2012
|
|
|
Six
Months
ended
June 30, 2011
|
|
|
Period from
inception
(October 12, 2010)
to June 30, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
89,994
|
|
Cost of revenue
|
|
|
-
|
|
|
|
-
|
|
|
|
66,227
|
|
Gross Profit
|
|
|
-
|
|
|
|
-
|
|
|
|
23,767
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive compensation
|
|
|
50,000
|
|
|
|
-
|
|
|
|
50,000
|
|
Exploration and development costs
|
|
|
12,380
|
|
|
|
-
|
|
|
|
15,513
|
|
Exploration and development costs - related party
|
|
|
70,272
|
|
|
|
|
|
|
|
109,922
|
|
General and administrative
|
|
|
59,737
|
|
|
|
-
|
|
|
|
67,341
|
|
General and administrative - related party
|
|
|
-
|
|
|
|
-
|
|
|
|
27,500
|
|
|
|
|
192,389
|
|
|
|
-
|
|
|
|
270,276
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Loss
|
|
|
(192,389
|
)
|
|
|
-
|
|
|
|
(246,509
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, related parties
|
|
|
(7,647
|
)
|
|
|
-
|
|
|
|
(7,785
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(200,036
|
)
|
|
$
|
-
|
|
|
$
|
(254,294
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding
|
|
|
1,000,000
|
|
|
|
-
|
|
|
|
1,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted (loss) per share
|
|
$
|
(0.20
|
)
|
|
$
|
-
|
|
|
$
|
(0.25
|
)
|
S
e
e
n
o
t
e
s
t
o
c
o
nd
e
n
s
e
d
c
o
n
s
ol
idat
e
d
f
inancia
l
s
tat
e
m
e
nts
Bo
l
cá
n
M
i
n
i
n
g
Cor
p
orat
i
o
n
(AN
E
X
PLORATION STAGE COMPANY)
Condensed
Consolidated Statements of Cash
Flows
(Unaudited)
|
|
Six
Months
ended
June 30, 2012
|
|
|
Six
Months
ended
June 30, 2011
|
|
|
Period
from
inception
(October 12, 2010)
to June 30, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(200,036
|
)
|
|
$
|
-
|
|
|
$
|
(254,294
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
3,140
|
|
|
|
-
|
|
|
|
4,187
|
|
Non-cash interest expense
|
|
|
7,647
|
|
|
|
-
|
|
|
|
7,647
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued expenses
|
|
|
51,869
|
|
|
|
-
|
|
|
|
52,647
|
|
Accrued compensation
|
|
|
50,000
|
|
|
|
-
|
|
|
|
50,000
|
|
Net cash used in operating activities
|
|
|
(87,380
|
)
|
|
|
-
|
|
|
|
(139,813
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of property and equipment
|
|
|
-
|
|
|
|
-
|
|
|
|
(33,401
|
)
|
Acquisition of mineral rights
|
|
|
(25,869
|
)
|
|
|
-
|
|
|
|
(25,869
|
)
|
Cash used in investing activities
|
|
|
(25,869
|
)
|
|
|
-
|
|
|
|
(59,270
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Advances from majority owner
|
|
|
10,185
|
|
|
|
-
|
|
|
|
17,910
|
|
Advances from officer
|
|
|
42,000
|
|
|
|
-
|
|
|
|
42,000
|
|
Other advances
|
|
|
70,000
|
|
|
|
-
|
|
|
|
155,000
|
|
Member’s contributions
|
|
|
-
|
|
|
|
-
|
|
|
|
100
|
|
Cash provided by financing activities
|
|
|
122,185
|
|
|
|
-
|
|
|
|
215,010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in cash
|
|
|
8,936
|
|
|
|
-
|
|
|
|
15,927
|
|
Cash, beginning of period
|
|
|
6,991
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, end of period
|
|
$
|
15,927
|
|
|
$
|
-
|
|
|
$
|
15,927
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental information:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
Taxes
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
S
e
e
n
o
t
e
s
t
o
c
o
nd
e
n
s
e
d
c
o
n
s
ol
idat
e
d
f
inancia
l
s
tat
e
m
e
nts
NO
T
ES
TO
THE CONDENSED
CONSO
L
IDA
T
ED
FINANCIAL
STAT
E
MENTS
NO
T
E
1
–
ORG
A
N
I
Z
AT
ION
AND
N
ATU
R
E OF
BUSI
N
ESS
Bolcán
Mining Cor
p
oration (“Bolcán Mining”) was incorporated on April
11, 2012 and The Bolcán Group
LLC (“Bolcán Gr
o
up”)
was formed
on Oct
o
ber
12, 20
1
0. Bolcán
Mining
and Bolcán
Group
are collectively
referred to
as
“the C
o
m
p
any.”
The
operating activities of the Bolcán Group were
inconsequential until
Oc
t
ober 2011
a
nd consisted primarily
of historical site research performed by Michael Stanford. Effective June 30, 2012, Bolcán Mining acquired all of
a
ssets
and ass
u
m
ed all known liabili
t
ies
of Bolcán Group.
T
h
e Co
m
p
any
accounted
for this transaction as a
business
c
o
m
b
i
n
a
t
ion
between
entities under common control under ASC 805-50. Therefore, the C
o
m
p
any
recognized the assets and liabilities
transferred at
their carr
y
ing a
m
ounts
as of the date of
t
ransfer. These financial
statements include the resul
t
s of operations as though the transfer
h
ad occurred at the beginni
n
g
of the period. Further
m
o
re, the
finan
c
ial
stat
e
ments
have been retrospective
l
y adjusted for prior periods. The Maj
o
rity
Owner has other
m
ining interests and prov
i
des
services to
the
m
ining
industry that are
not
part
of
the
C
o
m
p
an
y
.
The
Co
m
p
a
n
y
was form
e
d to pursue the developme
n
t of
certain
m
ining cla
i
m
s,
m
ine
r
al leas
e
s
and excavation rights (collectively referred to herein as
“
m
ineral
rights”) for
m
i
n
ing projects located
in (a) Star Mining District in Beaver Count
y
, Utah, (b) S
p
or
Mountain Mining District in Juab C
o
un
t
y
,
Utah, and (c) Ogden Bay Wi
l
d
li
f
e
Management Area
in Web
e
r Coun
t
y
,
Utah.
On April
23,
2
01
2
,
t
h
e C
o
m
p
any
acquired cer
t
ain lode
m
ining
cla
i
m
s
a
nd
m
ineral
l
eases
re
l
ated to the Star Mining
District
and Spor Mountain M
i
ning
District
projects.
NO
T
E
2 – GOI
N
G
C
O
N
C
E
RN
The
C
o
m
p
a
n
y
is
an
explo
r
ation
stage e
n
terprise as
defined under generally
accepted
accounting principles in the United
States
(“
GA
AP”). The financial stat
e
ments
have been prepared on a go
i
ng
c
oncern
basis, which ass
u
mes
the C
o
m
p
any
will be
a
b
le to realize its assets a
n
d
discharge its liabilities in the normal course of business for the foreseeable
fu
ture.
The C
o
m
p
any
has incurred losses since inception resulting in an acc
u
m
u
lated
stockholders’ d
e
ficit of $54,258
a
nd
$254,294 as of December 31, 2011
and June
30,
2012, respectively, and fu
r
ther losses a
r
e
anticipated in
the development of
its business.
In
addition
t
h
e
C
o
m
p
any
h
a
d a working capital deficiency of $284
,
412
at June 30, 2012.
T
h
e C
o
m
p
any’s
ability to continue
as a going concern
is
dep
e
ndent upon the C
o
m
p
any
g
e
nerat
i
ng profitable
operations and cash flows in the near-te
r
m
a
n
d/or to obtain the nece
ss
ary financing
to
m
eet its obligations and repay i
t
s
liabilities arising from normal business operations. Management plans to finance the C
o
m
p
any
’
s
operating
co
s
ts as necessa
r
y
over the next twelve m
o
nths with advances
fr
o
m
s
t
ockholders
and directors, and the private
plac
e
ment of the C
o
mpany
’
s
c
o
mmon stock. If
m
anagement is unsucc
e
s
s
ful
in the
s
e efforts,
discontinuance
of
operations is possible. The
financial
sta
te
m
ents do not
include
any adjus
t
m
e
n
t
s
that
m
ight result from the
outcome
of
this
uncertaint
y
.
NO
T
E
3
–
SUMMA
R
Y
OF
SIGNIF
I
CANT AC
C
OU
N
TI
N
G
POL
I
CIES
Basis
of
A
cc
ounting and Presentation
The
consolidated financial
stateme
n
ts include
the
accounts
of the
C
o
m
p
an
y
.
All
significant interc
o
m
pany
balances
and
transactions have been el
i
minated.
The
acc
o
m
p
an
y
ing
f
i
nancial statements have been prepared wi
t
hout
audi
t
, pursuant to
the
rules and regulations of the Securit
i
es and Exc
h
ange
C
o
m
m
i
ssion.
The
in
ter
i
m finan
c
ial
sta
te
m
en
t
s
refl
e
ct all adjust
m
ents, consisting of
nor
m
al recurring ad
j
u
s
t
ments
whic
h
, in
t
h
e
op
in
ion of
m
anage
m
ent,
are neces
s
ary to
present
a fair
stat
e
ment of
the
results
of
the
period.
Certain
information and footnote dis
c
losures normally included in financial stat
e
ments
prepared
i
n accordance
with
generally accepted ac
c
ounting prin
c
iples
have
been
condensed or
o
m
itted.
It
is
suggested that
these condensed
financial sta
t
ements
be read
i
n conjunction with the financial sta
t
ements
and notes thereto included in the Co
m
p
an
y
’
s
financial sta
te
m
ents for the
y
ear
ended Dec
e
mber 31, 2011. The results of op
e
rations
for the period end
e
d June 30, 2012, are not necessarily
indicative of the operating results
for
the
full
y
ear.
Manag
e
m
ent
has e
l
ected not to
m
e
as
u
re
any of its eligible financial instr
u
m
e
nts
or other ite
m
s at fa
i
r value. A
c
cordingly,
exc
e
pt as
r
equired
by
GAAP and disclo
s
ed herein, the C
o
m
p
any
continues to measure all of
its asse
t
s
and
liabilities at historical
cost.
The
Co
m
p
a
n
y
is in the exploration stage and its
p
ri
m
ary
activities
to date have includ
e
d
con
d
ucting research and exploration, developing markets for its products,
securing strategic alliances, recruiting personnel and
obtaining
financing. As
an
exploration stage
enter
p
rise, the
C
o
mpany
is
required to
present c
u
m
u
lative
a
m
ounts fr
o
m inception
(October
12,
2010) through
th
e
latest peri
o
d presented
herein.
Mineral
Rights
The
Co
m
p
a
n
y
concluded
that
m
ine
r
al
rights
m
e
et
t
h
e
definition of
tangible asse
t
s. Acco
rd
ingly, the
C
o
m
p
any
capitalizes
cer
t
ain costs related
to the acqu
i
sition of mining claims
and
m
ineral lease
rights. Costs of
exploring, car
r
y
i
n
g
and
retaini
n
g
u
n
prov
e
n properties, if
an
y
, are
expensed
as
incurr
e
d.
Use
o
f
E
s
t
i
m
a
tes
The
prepara
t
ion of financial s
t
at
e
ments
in con
f
ormity with GAAP requir
e
s manag
e
m
e
nt
to make est
i
mates
and
ass
u
m
p
tions
that affect re
p
o
rted a
m
ounts.
Actual
res
u
lts could diff
e
r
from those est
i
m
ates.
NOTE
4 –
M
INERAL RIGHTS
Star
Mounta
i
n
On
April 2
3
, 20
1
2,
t
h
e
C
o
m
p
any
paid and capital
i
zed $22
,
113 to acquire
1
1
7 u
n
patented lode
m
ining
cla
i
ms
fr
o
m
th
e Bureau
of Land Management
related to the
Star
M
o
untain
project
near
Milford,
Utah. In addition,
on
May 1,
2
01
2
,
the Co
m
p
a
n
y
entered into a
m
ine
r
al
le
a
se agre
e
ment
with
the State of Utah
for approxi
m
ately
1,400 acres that are contiguous with
t
he Star Mountain lode
m
i
ning
clai
m
s. The initial costs incurred
and
capital
i
zed in conn
e
ction with ob
t
aining
the l
e
ase was $1,599. Collectivel
y
,
t
h
e Star Mountain cla
i
ms
and
lease
enc
o
m
p
ass
a total area of
approxi
m
ately 3,740 acres.
The
lease has an initial term
of 10
y
e
a
rs,
subject
to certain extension provisions. The future
m
in
i
m
u
m
annual
rental c
o
m
m
itment
is $1.00 per acre (or $1,408). The lease also provides
for a
m
i
n
i
m
u
m
annual r
o
y
al
t
y
p
a
y
m
ent
of $4
,
2
2
4 beginn
i
ng
i
n the 11
th
y
ear of the lease
(if extended), and requires
contingent production ro
y
al
t
y
p
a
y
m
e
n
ts
based on 4% to 8% of the gross v
a
lue (as defined in the le
a
se)
of non- fissionable and
fissionable metalif
f
erous
minerals,
r
esp
ectivel
y
,
extracted
fr
o
m
th
e
leased a
re
a.
Spor
M
o
unta
i
n
On
May 1, 201
2
, the Co
m
p
any
entered into a
mineral lease
agreement with
the State of Utah for approxi
m
ate
l
y 1,920
acres related to the Dugway Minerals project near Delta, Utah. The initial costs incurred and capitalized in connection with obta
i
ning
t
h
e lease were $2,157.
The
lease has an initial term
of 10
y
e
a
rs,
subject
to certain extension provisions. The future
m
in
i
m
u
m
annual
rental c
o
m
m
itment
is $1.00 per acre (or $1,918). The lease also provides
for a
m
i
n
i
m
u
m
annual ro
y
alty
p
a
y
m
e
n
t
o
f $
5
,
7
54
b
e
g
in
n
i
n
g
in t
h
e 11
th
y
e
ar
of the lease, and r
e
quires contingent production ro
y
al
t
y
p
a
y
ments based on 4% to 8% of the gross
v
a
lue (as defi
n
ed in the lease) of non-fissionable
and fissionable metalifferous minerals,
resp
e
ctivel
y
,
extracted
fr
o
m the
leased a
r
ea.
NO
T
E
5
–
TRAN
S
AC
TI
ONS
W
I
TH SHA
R
EHOLDER
The
Majority Owner has made periodic advances to the Co
m
p
any
to fund operations, which are unsecured and p
a
y
able
on de
m
and after June 30, 2013,
w
ith
i
n
terest
at the rate of 12% per
a
nnu
m
. The outstanding
advances
included
accrued
in
terest
of
$138
and
$1,004 as of
Dece
m
b
e
r
31,
2011
and
June
30, 201
2
, respectively.
On
May 11, 201
2
, this same individu
a
l loaned
the C
o
m
p
any
$
4
2,0
0
0. The
l
o
an
is guaranteed
b
y
t
h
e
Majority Owner, bears interest at 12% per annu
m
,
a
nd
has been extended to a due date of August 2
4
,
2012.
As the loan has passed
its due date, it is in de
f
ault.
At June 30, 2012, accrued
interest on the note is $693. The
value
of the Majority Owner’s
loan
g
u
a
r
antee
is co
n
sidered n
o
m
inal
and not g
i
ven
effect
in the
Co
m
p
an
y
’
s
financial
stat
e
ments.
The
Co
m
p
a
n
y
has contracted
for
m
inerals testing, laboratory
services,
project manag
e
ment
and
m
a
t
erials supp
l
y
f
r
om
several
entities that are operated by com
m
on
management
or are otherwise
controlled
by the Majority
Owner. P
a
y
m
e
n
ts
to such re
l
ated parties totaled $6
7
,1
5
0
for
t
h
e per
i
od
ended Dece
m
b
er 31, 2011 and
$
7
0
,273
f
o
r
the
s
i
x
m
onths ended June
30,
2
012.
NO
T
E
6
–
CON
V
ER
T
I
B
LE
DE
B
T
In
connection with
a me
m
or
andum
o
f understand
i
ng dated October 27,
2011, the Co
m
p
any received certain
cash
a
dvances from an unrelated
party during
t
h
e periods ended Dec
e
m
be
r
31, 2011 and June 30, 2012.
T
h
ese
advances are
unsecured, do
not bear
int
e
rest
and
are
pa
y
able
on
demand. On
June 11,
2012, the
C
o
m
p
any
issued
a non-interest bearing
convertib
l
e
pr
o
m
issory note in
the
a
m
ount
of
$105,0
0
0 for
the portion
of
t
h
e
advances
previous
l
y received
with add
i
tional a
m
ounts
that may be advanced from t
i
me to time with
m
u
tual
agreement. Prior
t
o
J
anuary
1,
20
13, the note
i
s due on demand;
however, the u
n
paid balance is convertible at the option
of
t
h
e
unrelated party
or
the C
o
m
p
any
in
t
o
shares
of
c
o
m
m
on
stock
of the post-merger c
o
m
p
any
(Note
8) at the rate of one share
of c
o
m
m
on
stock
f
o
r every two dollars of loan reduction.
Interest expense
has been
i
m
puted
at 12
%
, resulting
in an additional credit
of
$
6
,088 being recorded
as additional paid-in capital. All advances
under this facili
t
y
are shown as a
current liability in the acc
o
m
p
an
y
ing
f
i
nancial statements. At June 30, 2012, tot
a
l
advances to the C
o
m
p
any
under this convertible p
r
o
m
issory
n
o
t
e
were $155,000.
NO
T
E
7
–
INCO
M
E
T
AX
ES
Until
April 11, 2012, the C
o
m
p
any’s
operations
were conducted
by
the Bolcán Group, a
Utah li
m
ited
liabili
t
y compan
y
. Since
t
h
e Bolcán
Group
elected
t
o be
taxed
as
a partnership,
its net
losses
through
t
h
at
date “passed-throu
g
h” to and are included in t
h
e
personal tax returns of the Majority Owner. Subsequently, net
operating losses of
th
e
C
o
m
p
any
are
refl
e
cted as deferred tax
a
s
sets, net of a 10
0
% valuation
allowance beca
u
se
m
anag
e
m
e
nt
believes that
r
ealization of such future tax benefit is unlikely due to
t
h
e
startup nature of the Co
m
p
any’s
operations,
its li
m
ited operating
histo
r
y
, a
n
d
t
h
e
absence of proven
m
ineral
reserves
at this ti
m
e th
a
t
would
produce future
e
a
rnings.
Such
m
atte
r
s r
e
sult
in a ze
r
o effective tax rate for the periods presented, which differs fr
o
m
the statutory federal tax rate of 34%. Est
i
m
ated
penalties and interest rela
t
ed to inco
m
e
t
a
x
m
at
t
ers,
if an
y
, including uncertain
t
ax positions,
are
recorded
as
a c
o
m
ponent of
inco
m
e tax
expense.
NO
T
E
8
–
PLAN
OF
M
ERGER
Effective
May 7, 2
0
12,
t
h
e
Co
m
p
any entered
into an Agre
e
m
en
t
and Plan of Merger
with Jameson Stanford
Re
s
ources
Corporation, (“J
a
meson
Stanford”),
and JSR
S
ub Co, (“JS
R
”),
both
unrelated
partie
s
.
On Ju
l
y 24,
2
012,
the ab
ov
e parties
entered
into an
E
x
tension
Ag
r
eement
in o
rd
er
to extend
t
h
e
Effecti
v
e T
i
m
e
of the Merger to A
u
gust 3, 2012.
On October
2
4
, 2012,
the parties
ente
re
d
into a sec
o
nd Extension Agreement extending the closing date for the Merger
to October 29,
2
01
2
. On October 29,
2
012, the Merger
w
as
c
losed. Effec
t
ive as
of
the
closing
of
t
h
e
Merger,
the
CEO and
Di
r
ector
of
J
a
m
e
son Stanford will resign from
all positions
with the Co
m
p
any
and he shall return for cancellation 52,500,000
shares of the Jameson Stanfor
d
’s
common stock held in his
n
a
m
e
.
Also at closing, the shareholder
of Bolcán Mining will be
issued 25
,
000
,
000
shares of
Ja
m
e
son
Stanford’s c
o
m
m
on stock. After the
Merger, there will be 31,300,000
shares of Jameson Stanford com
m
on
stock o
u
tstanding, of which approx
i
m
ately
80% will be held by
the for
m
er shareholders
of Bolcán.
T
he transaction
is
expec
t
ed to be treated as a rever
s
e
acquisition of
a public co
m
p
any
and
a
ccounted for
as a business c
o
m
b
ination.
According
l
y
, the
historic financial
statements of
Bolcán
Mining
w
ould
be
the
h
i
storic
statements of
the
co
m
b
ined
entity.
JAMESON
STANFORD RESOURCES CORP (JSRC)
and
BOLCÁN
MINING CORPORATION (Bolcán)
PRO FORMA
COMBINED
FINANCIAL INFORMATION
FOR THE
YEAR ENDED DECEMBER 31, 2011 AND SIX MONTHS ENDED JUNE 30, 2012
INDEX
TO PRO FORMA FINANCIAL STATEMENTS
|
|
Page
|
|
|
|
Pro Forma Financial
Statements
|
|
|
|
|
|
Combined Balance Sheet
|
|
F-2
|
Combined Statements of Operations
|
|
F-3
|
JAMESON STANFORD RESOURCES CORP.
(AN EXPLORATION STAGE COMPANY)
Pro Forma Combined Balance Sheets
(unaudited)
|
|
Historical
|
|
|
|
|
Pro
Forma
|
|
Historical
|
|
|
|
Pro
Forma
|
|
|
|
Bolcán
|
|
|
JSRC
|
|
|
Pro Forma
|
|
|
|
|
Combined
|
|
Bolcán
|
|
|
JSRC
|
|
|
Pro Forma
|
|
|
|
Combined
|
|
|
|
December 31, 2011
|
|
|
December 31, 2011
|
|
|
Adjustments
|
|
|
|
|
December 31, 2011
|
|
June 30, 2012
|
|
|
June 30, 2012
|
|
|
Adjustments
|
|
|
|
June 30, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
|
|
$
|
6,991
|
|
|
$
|
17
|
|
|
|
|
|
|
|
|
|
$
|
7,008
|
|
$
|
15,927
|
|
|
$
|
2
|
|
|
|
|
|
|
|
|
$
|
15,929
|
|
Total Current
Assets
|
|
|
6,991
|
|
|
|
17
|
|
|
|
|
|
|
|
|
|
|
7,008
|
|
|
15,927
|
|
|
|
2
|
|
|
|
|
|
|
|
|
|
15,929
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment,
net
|
|
|
32,354
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32,354
|
|
|
29,213
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29,213
|
|
Mineral rights
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
|
25,869
|
|
|
|
|
|
|
|
|
|
|
|
|
|
25,869
|
|
Total Assets
|
|
$
|
39,345
|
|
|
$
|
17
|
|
|
|
|
|
|
|
|
|
$
|
39,362
|
|
$
|
71,009
|
|
|
$
|
2
|
|
|
|
|
|
|
|
|
$
|
71,011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDER’S
EQUITY DEFICIENCY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued
expenses
|
|
$
|
778
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
$
|
778
|
|
$
|
52,646
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
52,646
|
|
Accrued compensation
|
|
|
-
|
|
|
|
7,100
|
|
|
|
|
|
|
|
|
|
|
7,100
|
|
|
50,000
|
|
|
|
4,400
|
|
|
|
|
|
|
|
|
|
54,400
|
|
Convertible debt
|
|
|
85,000
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
85,000
|
|
|
155,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
155,000
|
|
Loan from related party
|
|
|
-
|
|
|
|
9,898
|
|
|
|
|
|
|
|
|
|
|
9,898
|
|
|
42,693
|
|
|
|
13,598
|
|
|
|
|
|
|
|
|
|
56,291
|
|
Total Current
Liabilities
|
|
|
85,778
|
|
|
|
16,998
|
|
|
|
|
|
|
|
|
|
|
102,776
|
|
|
300,339
|
|
|
|
17,998
|
|
|
|
|
|
|
|
|
|
318,337
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advances from Majority Owner,
including accrued interest
|
|
|
7,725
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,725
|
|
|
18,776
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,776
|
|
Total Liabilities
|
|
$
|
93,503
|
|
|
$
|
16,998
|
|
|
|
|
|
|
|
|
|
|
110,501
|
|
|
319,115
|
|
|
|
17,998
|
|
|
|
-
|
|
|
|
|
|
337,113
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par
value, 350,000,000 shares authorized, 31,300,000 issued and outstanding
|
|
$
|
100
|
|
|
$
|
8,400
|
|
|
$
|
22,800
|
|
|
(1
|
)
|
|
|
31,300
|
|
|
1,000
|
|
|
|
8,400
|
|
|
|
21,900
|
|
|
(1
|
)
|
|
31,300
|
|
Additional paid-in capital
|
|
|
-
|
|
|
|
3,150
|
|
|
|
(3,150
|
)
|
|
(1
|
)
|
|
|
-
|
|
|
5,188
|
|
|
|
3,150
|
|
|
|
(8,338
|
)
|
|
(1
|
)
|
|
-
|
|
Deficit
|
|
|
(54,258
|
)
|
|
|
(28,531
|
)
|
|
|
(19,650
|
)
|
|
(1
|
)
|
|
|
(102,439
|
)
|
|
(254,294
|
)
|
|
|
(29,546
|
)
|
|
|
(13,562
|
)
|
|
(1
|
)
|
|
(297,402
|
)
|
Total Stockholders’
Deficit
|
|
|
(54,158
|
)
|
|
|
(16,981
|
)
|
|
|
|
|
|
|
|
|
|
(71,139
|
)
|
|
(248,106
|
)
|
|
|
(17,996
|
)
|
|
|
-
|
|
|
|
|
|
(266,102
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Stockholders’
Deficit
|
|
$
|
39,345
|
|
|
$
|
17
|
|
|
|
|
|
|
|
|
|
$
|
39,362
|
|
$
|
71,009
|
|
|
$
|
2
|
|
|
$
|
-
|
|
|
|
|
$
|
71,011
|
|
PRO-FORMA
ADJUSTMENTS
|
(1)
|
Recapitalization
due
to
reverse
merger
of
Jameson
Stanford
Resources
Corp
and
Bolcán
Mining
Corporation.
|
JAMESON
STANFORD RESOURCES CORP.
(AN
EXPLORATION STAGE COMPANY)
Pro Forma Combined Statements of Operations
(Unaudited)
|
|
Historical
|
|
Pro
Forma
|
|
Historical
|
|
|
|
Pro
Forma
|
|
|
|
Bolcán
|
|
|
JSRC
|
|
Pro
|
|
Combined
|
|
Bolcán
|
|
|
JSRC
|
|
Pro
|
|
Combined
|
|
|
|
Year
Ended
|
|
|
Year
Ended
|
|
Forma
|
|
Year Ended
|
|
Six Months Ended
|
|
|
Six Months Ended
|
|
Forma
|
|
Six Months Ended
|
|
|
|
December 31, 2011
|
|
|
December 31, 2011
|
|
Adjustments
|
|
December 31, 2011
|
|
June 30, 2012
|
|
|
June 30, 2012
|
|
Adjustments
|
|
June 30, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
89,994
|
|
|
|
|
|
$
|
-
|
|
$
|
89,994
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue
|
|
|
66,227
|
|
|
|
|
|
|
-
|
|
|
66,227
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
23,767
|
|
|
|
|
|
|
-
|
|
|
23,767
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive compensation
|
|
$
|
-
|
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
50,000
|
|
|
$
|
-
|
|
$
|
-
|
|
$
|
50,000
|
|
Exploration and development
costs
|
|
|
3,133
|
|
|
|
-
|
|
|
-
|
|
|
3,133
|
|
|
12,380
|
|
|
|
-
|
|
|
-
|
|
|
12,380
|
|
Exploration and development
costs - related party
|
|
|
39,650
|
|
|
|
-
|
|
|
-
|
|
|
39,650
|
|
|
70,272
|
|
|
|
-
|
|
|
-
|
|
|
70,272
|
|
General and administrative
|
|
|
7,604
|
|
|
|
4,335
|
|
|
-
|
|
|
11,939
|
|
|
59,737
|
|
|
|
1,015
|
|
|
-
|
|
|
60,752
|
|
General and administrative
- related party
|
|
|
27,500
|
|
|
|
-
|
|
|
-
|
|
|
27,500
|
|
|
-
|
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
77,887
|
|
|
|
4,335
|
|
|
-
|
|
|
82,222
|
|
|
192,389
|
|
|
|
1,015
|
|
|
-
|
|
|
193,404
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss
|
|
|
(54,120
|
)
|
|
|
(4,335
|
)
|
|
-
|
|
|
(58,455
|
)
|
|
(192,389
|
)
|
|
|
(1,015
|
)
|
|
-
|
|
|
(193,404
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, related
parties
|
|
|
(138
|
)
|
|
|
|
|
|
-
|
|
|
(138
|
)
|
|
(7,647
|
)
|
|
|
|
|
|
-
|
|
|
(7,647
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(54,258
|
)
|
|
$
|
(4,335
|
)
|
$
|
-
|
|
$
|
(58,593
|
)
|
$
|
(200,036
|
)
|
|
$
|
(1,015
|
)
|
$
|
-
|
|
$
|
(201,051
|
)
|
Mongolia Energy (PK) (USOTC:MOAEY)
Gráfica de Acción Histórica
De Jun 2024 a Jul 2024
Mongolia Energy (PK) (USOTC:MOAEY)
Gráfica de Acción Histórica
De Jul 2023 a Jul 2024