Item 1. Business
Throughout this Annual Report on Form 10-K Golden Eagle International, Inc. is referred to as "we," "our," "us," the "Company," or "Golden Eagle."
The Company was formed as a Colorado corporation on July 21, 1988 as Beneficial Capital Financial Services Corp. On February 2, 1995, the Company changed its name to Golden Eagle International, Inc.
In 2004, the Company purchased the 3,500 to 4,500 ton-per-day Gold Bar mill which is located 25 miles northwest of Eureka, Nevada. Initially, the Company's plan was to disassemble the mill and transport it to Bolivia to be reconstructed on mineral properties formally owned by the Company. However, due to the costs associated with disassembling and transporting the mill to Bolivia, the Company determined that the best course of action was to leave the mill in place and explore other options, such as processing ore for third parties which had mines in the area, or selling the mill.
Having been unsuccessful in selling the mill, or processing ore for third parties, the Company concluded the mill would not provide any meaningful value to the Company's shareholders. Accordingly, on October 30, 2015, the Company agreed to sell the mill to Gulf Coast Capital, LLC, an entity controlled by Mark Bogani, a former officer and director of the Company, in consideration for Gulf Coast assuming all of the Company's liabilities. On July 20, 2016, the agreement relating to the sale of the Gold Bar Mill was terminated by the mutual consent of the Company and Gulf Coast Capital.
The mill was not in operation when the Company acquired it, and it has not been in operation since it was acquired by the Company.
On October 30, 2015, the Company issued 160,000 shares of its Series B Preferred stock to Gulf Coast Capital, LLC in satisfaction of related party debt in the amount of $1,000. Gulf Coast Capital is controlled by Mark Bogani, who was the Company's Chief Executive Officer between October 1, 2015 and October 8, 2016.
During August and September 2016, the Company sold 4,000,000 shares of its common stock, as well as warrants to purchase an additional 6,000,000 shares of the Company's common stock, to a group of private investors for $100,000. The warrants are exercisable at prices between $0.05 and $0.20 per share at any time between June 30, 2017 and June 30, 2019.
On October 28, 2016, the Company acquired Advantego Technologies, Inc. in exchange for 127,915,000 shares of the Company's common stock.
In connection with this acquisition, the following management changes took place on October 28, 2016:
●
Mark Bogani resigned as an officer and director of the Company;
●
Frank Grey resigned as the Company's Secretary and Treasurer;
●
Tracy Madsen resigned as a director of the Company;
●
Robert Ferguson became a director of the Company and the Company's Chief Executive Officer;
●
Fred Popke became a director of the Company and the Company's Vice President, Secretary and Treasurer; and
●
John J. Carvelli and Barry Adnams became directors of the Company.
Frank Grey remained as the Company's Principal Financial and Accounting Officer and a director.
Advantego develops software, products and related services which are designed to enable an organization to rapidly and cost effectively create a comprehensive promotional and marketing campaign using social media marketing, customer relationship management and lead generation. Advantego plans to provide its software to a variety of clients, including businesses, financial institutions, real estate related entities, national franchise organizations, governmental agencies, schools and charities.
Social Media Marketing is the process of marketing through social media websites. Social media is a catch-all term for sites that may provide radically different social interactions. For instance, Twitter is a social media website designed to let people share short messages or "updates" with others.
Customer relationship management (CRM) practices, strategies and technologies are used to analyze customer personal information, purchase history, buying preferences and concerns with the goal of improving customer retention and increasing sales. CRM systems compile information on customers across different channels -- or points of contact between the customer and the organization -- which could include the organization's website, telephone, live chat forums, direct mail, marketing materials and social media.
Lead Generation is the process of identifying potential customers for list building, e-newsletter list acquisition and sales leads.
Advantego is a California corporation formed on July 29, 2016. As of December 31, 2016, Advantego had not entered into any agreements to provide its services to any third parties and had not earned any revenue.
Unless otherwise indicated, all references to the Company include the operations of Advantego.
On December 30, 2016, the Company transferred the Gold Bar Mill and its associated liabilities - consisting of severance pay notes payable plus accrued interest owed to former officers and directors Terry Turner and Tracy Madsen - to its wholly-owned subsidiary, Quove Corporation, which the Company formed on October 31, 2016. The Company subsequently transferred the shares of the subsidiary to a trust. When permitted by the rules and regulations of the Securities and Exchange Commission, the shares will be distributed to the Company's shareholders who owned eleven or more shares of the Company's common stock at the close of business on October 27, 2016. Quove Corporation has not had any operations since its inception.
On December 30, 2016, Gulf Coast Capital, LLC, a company controlled by Mark Bogani, a former officer and director of the Company, converted a note in the principal amount of $115,000 into 4,600,000 shares of the Company's common stock.
In 2017 the Company plans to change its name to Advantego Corporation, with a corresponding change to its stock symbol.
Other Information
At July 27, 2017, the Company had two full time and no part time employees. The Company currently outsources most of its software development and marketing requirements to third parties.
The Company rents executive office space at 1 Park Plaza, Suite 600, Irvine, CA 92614 on a monthly basis. The rent on this space ranges from $200 to $500 per month, depending on the Company's usage of this space.
Virtual Office software and VOIP phone services enable the Company's employees, contracted service providers, and partners to 'work from anywhere' while still being centrally connected.
The Company files its annual, quarterly, and current reports with the Securities and Exchange Commission (SEC), copies of which are available at www.sec.gov. The public may also read and copy any materials that the Company has filed with the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549.
Item 1A.
Item 1A. Risk Factors.
Not applicable.
Item 1B.
Item 1B. Unresolved Staff Comments.
None.
Item 2.
Item 2. Properties.
See Item 1.
Item 3.
Item 3. Legal Proceedings.
None.
Item 4.
Item 4. Mine Safety Disclosures
None.
Item 5.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Our common stock is quoted on the Over-the-Counter market under the trading symbol "MYNG." The following table shows the high and low prices of our common stock during the last two years. These prices represent inter-dealer prices, without retail mark-up, markdown, or commission, and may not represent actual transactions.
Holders of our common stock are entitled to receive dividends as may be declared by the Board of Directors. Our Board of Directors is not restricted from paying any dividends but is not obligated to declare a dividend. No cash dividends have ever been declared and it is not anticipated that cash dividends will ever be paid.
Our Articles of Incorporation authorize our Board of Directors to issue up to 10,000,000 shares of preferred stock. The provisions in the Articles of Incorporation relating to the preferred stock allow our directors to issue preferred stock with multiple votes per share and dividend rights which would have priority over any dividends paid with respect to the holders of our common stock. The issuance of preferred stock with these rights may make the removal of management difficult even if the removal would be considered beneficial to shareholders generally, and will have the effect of limiting shareholder participation in certain transactions such as mergers or tender offers if these transactions are not favored by our management.
As of, July 27, 2017 the Company had 159,883,328 outstanding shares of common stock which were owned by 1,176 shareholders of record. Approximately 720 shareholders own ten or less shares. These 720 shareholders collectively own approximately 2,000 shares of the Company's common stock. Based upon the closing price of the Company's common stock on July 27, 2017, ($0.06 per share), ten shares were worth $0.60 and are essentially worthless. Accordingly, the Company plans to call a special meeting of its shareholders to approve an 11-for-1 reverse split of the outstanding shares of the Company's common stock. By eliminating approximately 720 shareholders of record whose shares do not have any practical value, the Company can greatly reduce the cost associated with mailing proxy statements and other communications to its shareholders.
Item 6.
Item 6. Selected Financial Data
Not applicable.
Item 7.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operation.
During the two years ended December 31, 2015 and 2014, we did not generate any revenue and our only significant asset was our Gold Bar Mill which has never been in operation.
The only material change in our Statement of Operations for the year ended December 31, 2015, as compared to the year ended December 31, 2014, was a decrease of $8,008 in General and Administrative Expenses. This is due primarily to a significant decrease in Professional Fees, as we suspended our SEC filings during this period and did not incur the related accounting, audit, and legal fees.
We do not know of any trends, events or uncertainties that have had, or are reasonably expected to have, a material impact on our revenues or expenses.
Our sources and (uses) of cash for the years ended December 31, 2015 and 2014 are shown below:
On August 31, 2016, Terry Turner and Tracy Madsen agreed that all amounts owed to them would be satisfied solely from the proceeds from the sale of the Gold Bar Mill. At the time of this agreement we owed Mr. Turner $421,726 and we owed Mr. Madsen $310,027.
During August and September 2016, we sold 4,000,000 shares of our common stock, as well as warrants to purchase an additional 6,000,000 shares of our common stock, to a group of private investors for $100,000.
Other than funding our minimal operating expenses, we did not, as of December 31, 2015, have any significant capital requirements.
Other than the foregoing, we do not know of any trends, demands, commitments, events or uncertainties that will result in, or that are reasonable likely to result in, our liquidity increasing or decreasing in any material way.
Other than the foregoing, we do not know of any significant changes in our expected sources and uses of cash.
We do not have any commitments or arrangements from any person to provide us with any equity capital.
See Note B to the financial statements included as part of this report for a description of our significant accounting policies.
Item 7A.
Item 7A. Quantitative and Qualitative Disclosure about Market Risk
Not applicable.
Item 8.
Item 8. Financial Statements and Supplementary Data.
See the financial statements attached to this report.
Item 9.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
Our former accountants resigned on May 6, 2015. See our 8-K filed on November 12, 2015 for further information.
On October 16, 2016, the Company, through and with the approval of its Board of Directors, engaged Pritchett, Siler & Hardy, PC, ("PS&H") as its independent registered public accounting firm. Prior to engaging PS&H the Company did not consult with PS&H regarding the application of accounting principles to a specific completed or contemplated transaction regarding the type of audit opinion that might be rendered by PS&H on the Company's financial statements, and PS&H did not provide any written or oral advice that was an important factor considered by the Company in reaching a decision as to any accounting, auditing or financial reporting issue.
Item 9A.
Item 9A. Controls and Procedures.
An evaluation was carried out under the supervision and with the participation of our management, including our Principal Executive and Financial Officers of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report on Form 10-K. Disclosure controls and procedures are procedures designed with the objective of ensuring that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, such as this Form 10-K, is recorded, processed, summarized and reported, within the time period specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and is communicated to our management, including our Principal Executive and Financial Officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Based on that evaluation, our management concluded that, as of December 31, 2015, our disclosure controls and procedures were not effective. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
Management's Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of internal control over financial reporting. As defined by the Securities and Exchange Commission, internal control over financial reporting is a process designed by, or under the supervision of our Principal Executive and Financial Officers and implemented by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements in accordance with U.S. generally accepted accounting principles.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Our Principal Executive and Financial Officers evaluated the effectiveness of our internal control over financial reporting as of December 31, 2015, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission, or the COSO Framework (1992). Management's assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of those controls.
Based on this evaluation, management concluded that our internal control over financial reporting was not effective as of December 31, 2015.
Changes in Internal Control Over Financial Reporting
There was no change in our internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Item 9B.
Item 9B. Other Information.
None.
Item 10.
Item 10. Directors, Executive Officers and Corporate Governance.
Our officers and directors are listed below.
Directors are generally elected at an annual shareholders' meeting and hold office until the next annual shareholders' meeting, or until their successors are elected and qualified. Executive officers are elected by directors and serve at the board's discretion.
The principal occupations of the Company's officers and directors during the past several years are as follows:
Robert Ferguson has been an officer and director of the Company since October 28, 2016. Since 2001 Mr. Ferguson has been the managing member of CJBS Holdings LLC, d/b/a Integrated Strategic Solutions, a privately-owned consulting and investment company focused in technology and real estate. Since 2011, Mr. Ferguson has been the Chairman of First Enterprise Realty Group, Inc., a licensed brokerage firm in California.
Fred Popke has been an officer and director of the Company since October 28, 2016. Since 2009, Mr. Popke has served as the President of Real Estate Services and Technology, a firm engaged in providing custom software solutions for the real estate and financial industries. From 2006 to 2009 Mr. Popke was the Product Director at Commerce Velocity, a firm engaged in developing and delivering enterprise-level underwriting and decisioning software for the financial industry.
Philip F. (Frank) Grey has been an officer and director of this Company since October 1, 2015. Mr. Grey has been in the financial services industry for more than 25 years specializing in private and public equity, futures and commodities, as well as the foreign exchange markets. He has been involved in investment banking facilitating mergers and acquisitions for both private and public companies focusing on the technology and energy sectors. For the past six years, he has been a consultant to Share Agent, LLC and Securities Logistics Legal Group advising foreign companies and individuals in the complexities of U.S. and Canadian securities markets. From 2008 to 2010, Mr. Grey was employed at Velocity Capital Advisors, a company he founded to act as an introducing brokerage firm for futures, commodities and Forex trading. Prior to 2008, Mr. Grey served as Vice President of Institutional Sales for Acuvest, Inc., a futures and commodities firm located in Southern California.
John Carvelli has been a director of Golden Eagle since October 28, 2016. Mr. Carvelli has been the Executive Vice President of the Liberty Dental Plan group of companies, a national dental benefits administrator, since 2004. Prior to joining Liberty in 2004, John completed a multi-year project directing a hospital and integrated medical community clinic system in Los Angeles, CA.
Our directors are generally elected at our annual shareholders' meeting and hold office until the next annual shareholders' meeting, or until their successors are elected and qualified. Our executive officers are elected by our directors and serve at their discretion.
We believe that each of our directors is qualified to serve as a director for the following reasons:
John J. Carvelli is an independent director as that term is defined in Section 803 of the NYSE MKT Company Guide. Frank Grey acts as our financial expert.
We have not adopted a code of ethics applicable to our principal executive, financial and accounting officers and persons performing similar functions.
Our board of directors serves as our audit and compensation committees.
Item 11.
Item 11. Executive Compensation.
The following table summarizes the compensation received by our principal executive officers during the two years ended December 31, 2015.
(1)
The dollar value of base salary (cash and non-cash) earned.
(2)
The dollar value of bonus (cash and non-cash) earned.
(3)
The value of the shares of restricted stock issued as compensation for services computed in accordance with ASC 718 on the date of grant.
(4)
The value of all stock options computed in accordance with ASC 718 on the date of grant.
(5)
All other compensation received that could not be properly reported in any other column of the table.
Management Changes.
Terry C. Turner was appointed to our Board of Directors and as our President and Chief Executive Officer on February 14, 1997.
Mark Bogani was appointed to our Board of Directors on July 31, 2012.
Tracy A. Madsen was appointed as our Secretary/Treasurer and Chief Financial Officer on February 13, 2003.
On July 31, 2012 Mr. Turner was terminated as our Chief Executive Officer without cause, and Mr. Madsen became our new Chief Executive Officer.
On October 1, 2015:
●
Terry C. Turner resigned as a Director;
●
Tracy A. Madsen resigned as an Officer;
●
Mark A. Bogani was appointed as our President and Chief Executive Officer; and
●
Philip F. (Frank) Grey was appointed as our Chief Financial Officer, Chief Accounting Officer, Secretary and Treasurer, and as a Director.
In connection with the acquisition of Advantego Technologies, the following management changes took place on October 28, 2016:
●
Mark Bogani resigned as an officer and director of the Company;
●
Frank Grey resigned as the Company's Secretary and Treasurer;
●
Tracy Madsen resigned as a director of the Company;
●
Robert Ferguson became a director of the Company and the Company's Chief Executive Officer;
●
Fred Popke became a director of the Company and the Company's Vice President, Secretary and Treasurer; and
●
John J. Carvelli and Barry Adnams became directors of the Company.
On May 24, 2017, Barry Adnams resigned as a director.
Long-Term Incentive Plans. We do not provide our officers or employees with pension, stock appreciation rights, long-term incentive or other plans.
Employee Pension, Profit Sharing or other Retirement Plans. We do not have a defined benefit, pension plan, profit sharing or other retirement plan, although we may adopt one or more of such plans in the future.
Compensation of Directors. During the year ended December 31, 2015, we did not compensate our directors for acting as such.
Compensation Committee Interlocks and Insider Participation. During the year ended December 31, 2015, none of our officers was also a member of the compensation committee or a director of another entity, which other entity had one of its executive officers serving as one of our directors.
The following shows the amounts the Company expects to pay to its officers during the twelve months ending December 31, 2017 and the amount of time these persons expect to devote to the Company.
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The following table lists, as of July 27, 2017, the shareholdings of (i) each person owning beneficially 5% or more of the Company's common stock; (ii) each executive officer of the Company, and (iii) all officers and directors as a group. Unless otherwise indicated, each owner has sole voting and investment power over his shares of common stock.
At December 31, 2015, Mark Bogani(1) and Tracy Madsen owned 10,586,939 shares (45.3%) and 817,119 shares (3.5%), respectively, which comprises all common shareholdings by our then-officers and directors. No other significant shareholders were noted at that time.
(1)
Shares are registered in the name of Gulf Coast Capital, LLC, a company controlled by Mr. Bogani.
The following table lists, as of July 27, 2017, the shareholdings of each person owning the Company's Series B preferred stock. Unless otherwise indicated, each owner has sole voting and investment power over his shares of preferred stock:
(1)
Each Series B preferred share is convertible into one-half of a share of the Company's common stock. However, each Series B share is entitled to 250 votes on any matter submitted to the Company's shareholders. In contrast, each outstanding share of the Company's common stock is entitled to one vote per share. Since the number of votes to which the Series B shares are entitled is disproportionate to the number of common shares issuable upon the conversion of the Series B shares, bringing the voting rights of the Series B preferred shares in line with the Company's common stock is considered advisable. Accordingly, we plan to call a special meeting of the Company's shareholders to approve an amendment to the Series B preferred shares such that each Series B preferred share will be entitled to one vote per share on any matter submitted to the Company's shareholders.
(2)
Gulf Coast Capital is controlled by Mark Bogani, an officer and a director of the Company.
Item 13.
Item 13. Certain Relationships and Related Transactions, and Director Independence.
As of December 31, 2015, we owed to Terry Turner, a former officer and Director, severance pay and accrued interest of $350,000 and $60,027, respectively, pursuant to a 5% promissory note collateralized by the Gold Bar Mill and issued in lieu of the severance pay on July 27, 2012 with an original maturity date of July 27, 2013. On August 31, 2016, Mr. Turner agreed that these amounts we owed to him would be satisfied solely from the proceeds from the sale of the Gold Bar Mill. In consideration of this concession, in June 2016 Mr. Turner was issued 1,000 shares of the Company's common stock, which was valued at $10 and recorded as a general and administrative expense.
As of December 31, 2014, we also owed Mr. Turner principal and interest amounts of $45,500 and $1,275 pursuant to a 5% consolidated promissory note consisting of amounts loaned to the Company on various dates during 2014. The balance was increased during 2015 with a $10,000 loan and acquisition of $16,112 in reimbursable expenses due Crown Law (an entity owned by Mr. Turner). These individual amounts had been accruing interest at 5%, and on December 31, 2015, the outstanding amounts were consolidated into a single convertible note also bearing interest at 5%. The note and accrued interest, or any portion thereof, were convertible at the option of Mr. Turner, into the Company's common stock at a fixed price of $.025 per share at any time through December 31, 2020. Also on December 31, 2015, the principal and interest balances of $71,612 and $3,842, respectively, were assigned to Gulf Coast Capital, resulting in $0 owed to Mr. Turner under this note at December 31, 2015.
As of December 31, 2015, we owed to Tracy Madsen, a former officer and director, severance pay and accrued interest of $266,667 and $34,447, respectively, pursuant to a 5% promissory note collateralized by the Gold Bar Mill and issued in lieu of the severance pay on August 12, 2013 with an original maturity date of August 12, 3014. On August 31, 2016, Mr. Madsen agreed that all amounts we owed to him would be satisfied solely from the proceeds from the sale of the Gold Bar Mill. In consideration of this concession, in June 2016 Mr. Madsen was issued 1,000 shares of the Company's common stock, which was valued at $10 and recorded as a general and administrative expense.
As of December 31, 2015, we owed to Gulf Coast Capital, an entity controlled by Mark Bogani, a former officer and director, principal and interest of $145,112 and $11,951, respectively. On September 30, 2016, these notes payable were consolidated into a single convertible note in the amount of $160,583 bearing interest at 5%. The note and accrued interest, or any portion thereof, were convertible at the option of Gulf Coast Capital into the Company's common stock at a fixed rate of $.025 per share at any time through December 31, 2020. On December 30, 2016, $115,000 of the total note amount was converted into 4,600,000 shares of our common stock.
An entity controlled by Mark Bogani, a former officer and Director, acts as our transfer agent. We incurred fees with the transfer agent of $6,000 and $6,125 during the years ended December 31, 2015 and 2014, respectively. The amounts owing to the transfer agent, as at December 31, 2015 and 2014, were $21,615 and $13,159, respectively, including accrued interest of $3,896 and $1,440, respectively. Interest expense on outstanding charges for the years ended December 31, 2015 and 2014 was $2,456 and $1,440, respectively.
Avcon Services, an entity controlled by Tracy Madsen, a Director, has provided consulting services as it relates to accounting and finance in the amounts of $18,000 and $24,000 during the years ended December 31, 2015 and 2014, respectively. At December 31, 2014, the Company owed Avcon Services $14,000, which was included in Accounts Payable - Related Parties. On October 31, 2015, the total amount owed to Avcon of $30,500 was memorialized in a 5% note payable. The note and accrued interest, or any portion thereof, are convertible at the option of Avcon, into the Company's common stock at a fixed rate of $.025 per share at any time through December 31, 2020.
In connection with our acquisition of Advantego, as discussed in Item 1 of this report, the following persons (who, prior to the acquisition, were officers and directors of Advantego and owned 82% of Advantego, collectively) received shares of our common stock in the amounts shown below:
Prior to our acquisition of Advantego Technologies in October 2016, we shared certain office expenses with Crown Law Ltd, a law firm owned by Terry Turner, one of our prior officers and directors. Crown Law Ltd. deposits funds with us against which we apply their portion of rent, utilities and other expenses as we incur these expenses. As of December 31, 2015, we owed Crown Law Ltd. $0, as the payable amount of $16,112 was transferred to Terry Turner, and again to Gulf Coast Capital, as explained previously.
On December 30, 2016 we transferred the Gold Bar Mill and its associated liabilities consisting of severance pay, notes payable plus accrued interest owed to former officers and directors Terry Turner and Tracy Madsen to our wholly-owned subsidiary, Quove Corporation, which we formed on October 31, 2016. We subsequently transferred the shares of the subsidiary to a trust. When permitted by the rules and regulations of the Securities and Exchange Commission, the shares will be distributed to our shareholders who owned eleven or more shares of our common stock at the close of business on October 27, 2016. Quove Corporation has not had any operations since its inception.
Item 14.
Item 14. Principal Accountant Fees and Services.
Ingenium Accounting Associates was our principal accountant through May 6, 2015 and audited our financial statements for the year ended December 31, 2012. Pritchett, Siler & Hardy, PC has been our principal accountant since October 16, 2016 and audited our financial statements for the years ended December 31, 2014 and 2013. We did not incur any fees with Pritchett, Siler & Hardy, PC during these years since we did not engage Pritchett, Siler & Hardy, PC until 2016. The following shows the fees we incurred with Ingenium Accounting Associates for the years ended December 31, 2015 and 2014.
Audit fees represent amounts billed for professional services rendered for the audit of our annual financial statements and reviews of our quarterly financial statements.
Audit-related fees represent amounts billed for consents related to regulatory filings, audit/review of financial statements included in our registration statements filed with the Securities and Exchange Commission, and consulting related to the implementation of accounting standards.
Item 15.
Item 15. Exhibits and Financial Statement Schedules.
The following exhibits are filed with this Form 10-K or incorporated by references:
(1)
Incorporated by reference from our registration statement on Form 10-SB that became effective June 17, 1994.
(2)
Incorporated by reference from our 8-K report dated December 29, 2006.
(3)
Incorporated by reference from our 8-K report dated September 14, 2007.
PRITCHETT,SILER & HARDY, P.C.
CERTIFIED PUBLIC ACCOUNTANTS
A PROFESSIONAL CORPORATION
1438 N. HIGHWAY 89 STE. 130
FARMINGTON, UTAH 84025
(801) 447-9572 FAX (801) 447-9578
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board of Directors
Golden Eagle International, Inc.
Irvine, CA
We have audited the accompanying balance sheets of Golden Eagle International, Inc. (the Company) as of December 31, 2015 and 2014, and the related statements of operations, stockholders' equity (deficit), and cash flows for the years then ended. The Company's management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits 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 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 audits provide 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 Company as of December 31, 2015 and 2014, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note A to the financial statements, the Company has incurred losses since its inception, has a working capital deficit, and has not yet established profitable operations. These factors raise substantial doubt about the ability of the Company to continue as a going concern. Management's plans in regards to these matters are also described in Note A. These financial statements do not include any adjustments that might result from the outcome of these uncertainties.
/s/ Pritchett, Siler & Hardy, P.C.
PRITCHETT, SILER & HARDY, P.C.
Farmington, Utah
July 21, 2017
The accompanying notes are an integral part of these financial statements.
The accompanying notes are an integral part of these financial statements.
The accompanying notes are an integral part of these financial statements.
The accompanying notes are an integral part of these financial statements.
Golden Eagle International, Inc.
Notes to Financial Statements
Years Ended December 31, 2015 and 2014
Note A - Organization and Business
Organization and Nature of Business
Golden Eagle International, Inc. ("we," "us" or "Golden Eagle") was incorporated in Colorado on July 21, 1988. From late 2008 through June 2009, we were engaged in contract gold milling operations in the state of Nevada in the United States.
We have not had any business operations since we disposed of our wholly-owned subsidiary, Golden Eagle International, Inc. (Bolivia) in the first quarter of fiscal 2010. Prior to that time we had been involved in the business of minerals exploration and (prior to 2005) mining and milling operations in Bolivia through that subsidiary.
We currently own the Gold Bar Mill (the "Mill") in Eureka, Nevada which is not currently in operation and which will require a significant expenditure to rehabilitate should we choose to do so. Although we have been attempting to seek value for our investment in the Gold Bar Mill since its acquisition in 2004, and continue to do so, we have not been able to obtain the financing necessary to rehabilitate the Mill or enter into a joint venture or other business arrangement with respect to the Mill. The Mill is reported in our balance sheet at its expected net realizable value at December 31, 2015. On December 30, 2016, the Mill and its associated liabilities were transferred to a subsidiary we created in October 2016 and subsequently spun off, as explained in Note G.
Going Concern
The financial statements for the years ended December 31, 2015 and 2014 have been prepared on the going concern basis which assumes that adequate sources of financing will be obtained as required and that our assets will be realized and liabilities settled in the ordinary course of business. Accordingly, the financial statements do not include any adjustments related to the recoverability of assets and classification of assets and liabilities that might be necessary should we be unable to continue as a going concern. The Company has not yet achieved profitable operations, has accumulated losses of $(65,181,845), since its inception through December 31, 2015 and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company's ability to continue as a going concern. Should we be unable to sell the Gold Bar Mill or enter into a joint venture or merger arrangement with another party it is unlikely that we can continue as a going concern. In this event, we will seek to obtain other forms of debt or equity financing to remain a going concern. However, we can offer no assurances that we will be successful in these efforts.
Note B - Summary of Significant Accounting Policies
Use of Estimates
Preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates, and such differences may be material to the financial statements.
Concentration of Credit Risk
From time to time our cash balances, held at a major financial institution, exceed the federally insured limits of $250,000. Our management believes that the financial institution is financially sound and the risk of loss is low.
Cash and Cash Equivalents
For the statement of cash flows, any liquid investments with a maturity of three months or less at the time of acquisition are considered to be cash equivalents.
Property, Equipment and Mineral Development
Property and equipment are recorded at cost. Maintenance and repair costs are charged to expense as incurred, and renewals and improvements that extend the useful life of assets are capitalized. Depreciation on property and equipment is computed using the straight-line method over the assets' estimated useful lives as follows:
Mining equipment
7-8 years
Vehicles
5 years
Office equipment
4-10 years
At December 31, 2015 and 2014 our only property or equipment was the Gold Bar Mill located near Eureka, Nevada. The Mill has been idle since acquisition; therefore, no depreciation expense has been recognized.
Long-Lived Assets
We periodically review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment losses are recognized when the estimated future cash flows are less than the carrying amount of the asset calculated on discounted cash flow basis.
For the years ended December 31, 2015 and 2014 we did not recognize any impairment charges.
Stock Based Compensation
We measure stock-based compensation cost relative to the estimated fair value of the awards on the grant date using a Black Scholes options pricing model. We recognize the cost as the awards vest.
Income (Loss) Per Share
The computation of basic earnings (loss) per common share is based on the weighted average number of shares outstanding during each year.
The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the year plus the common stock equivalents as detailed in the following chart. In 2015 and 2014 the inclusion of these shares would have resulted in a weighted average shares fully diluted number that was anti-dilutive and as such they are excluded.
Stock equivalents consist of the following:
Fully diluted shares for the years ended December 31,
Income Taxes
Income taxes are accounted for under the liability method. Under the liability method, future tax liabilities and assets are recognized for the estimated future tax consequences attributable to differences between the amounts reported in the financial statements and their respective tax bases. Future tax assets and liabilities are measured using enacted or substantially enacted income tax rates expected to apply when the asset is realized or the liability settled.
Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry-forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax law and rates on the date of enactment.
Effect of New Accounting Pronouncements
There are no recent accounting pronouncements that are expected to have a material impact on our financial position, results of operations or cash flows.
Note C - Loans and Notes Payable - Related Parties
We have related party debt obligations outstanding at December 31, 2015 and 2014 as follows:
Note D - Stockholders' Equity
Common Stock
During the two years ended December 31, 2015 we did not issue any shares of common stock.
Preferred stock
Our Articles of Incorporation provide that we may issue up to 10,000,000 shares of various series of preferred stock. Subject to the requirements of the Colorado Business Corporation Act, the Board of Directors may issue the preferred stock in series with rights and preferences as the Board of Directors may determine appropriate, without shareholder approval. As of December 31, 2015, 4,500,000 shares of our Series B Preferred Stock have been authorized for issuance, and 240,000 shares were issued and outstanding. These 240,000 Series B shares are convertible into 120,000 common shares.
On October 30, 2015, we issued 160,000 shares of our Series B Preferred stock to Gulf Coat Capital, LLC in satisfaction of debt in the amount of $1,000. Gulf Coast Capital is controlled by Mark Bogani, who was our Chief Executive Officer between October 1, 2015 and October 8, 2016. Each preferred share is convertible into one-half share of our common stock. The common stock into which the preferred shares are convertible had a value of $800 on the issuance date based on the trading value of our common stock of $.01. Accordingly, we recorded in additional paid-in capital a gain on extinguishment of related party debt in the amount of $200. Since the value of the stock was less than the consideration paid, the conversion feature of the preferred stock is not deemed to be a derivative, and there is no beneficial conversion feature.
Note E - Related Party Transactions
An entity controlled by Mark Bogani, Our Chief Executive Officer and Chairman of the Board of Directors, has provided consulting services, as it relates to stock transfer services, in the amount of $6,000 and $6,125 during the years ended December 31, 2015 and 2014, respectively. The amounts owing, as of December 31, 2015 and 2014, were $21,615 and $13,159, respectively, including accrued interest of $3,896 and $1,440, respectively. Interest expense on outstanding charges for the years ended December 31, 2015 and 2014 was $2,456 and $1,440, respectively.
We share certain office expenses with Crown Law Ltd, a law firm owned by Terry Turner our former Chairman of the Board of Directors. Crown Law Ltd. deposited funds with us against which we applied to their portion of rent, utilities and other expenses as we incurred these expenses. As of December 31, 2014, we owed Crown Law Ltd. $17,343. On November 30, 2015, the $16,112 in reimbursable expenses owed to Crown Law Ltd. was transferred to Terry Turner's note payable (Note C), resulting in $0 payable to Crown Law Ltd. at December 31, 2015.
Avcon Services, an entity controlled by Tracy Madsen, a Director, has provided consulting services as it relates to accounting and finance in the amounts of $18,000 and $24,000 during the years ended December 31, 2015 and 2014, respectively. At December 31, 2014, the Company owed Avcon Services $14,000, which was included in Accounts Payable - Related Parties. On October 31, 2015, the total amount owed to Avcon of $30,500 was memorialized in a 5% note payable and reported as such at December 31, 2015 as explained in Note C.
See Note C for information concerning loans from Related Parties.
Note F - Income Taxes
Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences, and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Deferred tax assets and valuation allowance at December 31, 2015 and 2014:
A provision for income taxes has not been made due to net operating loss carry-forwards of $13,942,673 and $13,858,643 at December 31, 2015 and 2014, respectively, which may be offset against future taxable income through 2033. No tax benefit has been reported in the financial statements.
The actual provision for income tax differs from the statutory U.S. federal income tax rate for the years ended December 31, 2015 and 2014, respectively, as follows:
Current accounting guidance requires the Company to provide a reconciliation of the beginning and ending amount of unrecognized tax impacts related to the sustainability of tax positions taken in current and prior periods.
As of December 31, 2015, the Company did not have any tax positions for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase or decrease within the next 12 months.
The Company includes interest and penalties arising from the underpayment of income taxes in the statements of operations in the provision for income taxes. As of December 31, 2015, and 2014, the Company had no accrued interest or penalties related to uncertain tax positions.
The tax years that remain subject to examination by major taxing jurisdictions are those for the years ended December 31, 2012 through the present.
Note G - Subsequent Events
Stock Sale
During August and September 2016, we sold 4,000,000 shares of our common stock, as well as warrants to purchase an additional 6,000,000 shares of our common stock, to a group of private investors for $100,000. The warrants are exercisable at prices between $0.05 and $0.20 per share at any time between June 30, 2017 and June 30, 2019.
Notes Payable
On September 22, 2016, the Company received $50,000 from an unrelated party, and executed a Convertible Note, which bears interest at 6% and has a maturity date of September 22, 2017. At the option of the noteholder, the principal and accrued interest, in whole or in $100 portions, are convertible into the amount of principal plus accrued interest at the price of $.025 per share. With $0 accrued interest, this computes to 2,000,000 shares of the Company's common stock, which will increase ratably as interest accrues over time.
On September 30, 2016, the notes payable to Gulf Coast Capital, LLC (a company controlled by Mark Bogani, one of our former officers and directors) totaling $145,112 at December 31, 2015 (Note C) were consolidated into a single convertible note in the amount of $160,583 bearing interest at 5%. The note and accrued interest, or any portion thereof, are convertible at the option of Gulf Coast Capital into the Company's common stock at a fixed rate of $.025 per share. On December 30, 2016, $115,000 of the total note amount was converted into 4,600,000 shares of our common stock.
Business Combination
On October 28, 2016, we acquired Advantego Technologies, Inc. ("Advantego") in exchange for 127,915,000 shares of our common stock. Advantego develops software products and related services which are designed to enable an organization to rapidly and cost effectively create a comprehensive promotional and marketing campaign using social media marketing, customer relationship management, and lead generation. Advantego is a California corporation formed on July 29, 2016. As of July 27, 2017, Advantego had not entered into any agreements to provide its services to any third parties and had not earned any revenue.
In connection with this acquisition, the following management changes took place on October 28, 2016:
●
Mark Bogani resigned as an officer and director;
●
Frank Grey resigned as our Secretary and Treasurer;
●
Tracy Madsen resigned as a director;
●
Robert Ferguson became a director and our Chief Executive Officer;
●
Fred Popke became a director and our Vice President, Secretary and Treasurer; and
●
John J. Carvelli and Barry Adnams became directors.
Frank Grey remained as our Principal Financial and Accounting Officer and a director.
On December 30, 2016, we transferred the Gold Bar mill and its associated liabilities - consisting of severance pay notes payable plus accrued interest owed to former officers and directors Terry Turner and Tracy Madsen - to a wholly-owned subsidiary, Quove Corporation, which we formed on October 31, 2016. Also on December 30, 2016, we subsequently transferred the shares of the subsidiary to a trust. When permitted by the rules and regulations of the Securities and Exchange Commission, the shares will be distributed to our shareholders who owned eleven or more shares of our common stock at the close of business on October 27, 2016. Quove Corporation has not had any operations since its inception.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Pursuant to the requirements of the Securities Exchange Act of l934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Signature
Title
Date
/s/ Robert W. Ferguson
Chief Executive Officer and a Director
August 3, 2017
Robert W. Ferguson
/s/ Philip F. (Frank) Grey
Principal Financial and Accounting Officer and a Director
August 3, 2017
Philip F. (Frank) Grey
/s/ Fred Popke
Director
August 3, 2017
Fred Popke
/s/ John J. Carvelli
Director
August 3, 2017
John J. Carvelli