FLORIDA
|
7389
|
65-0955118
|
(State
or other jurisdiction of incorporation or organization)
|
(Primary
Standard Industrial
|
(I.R.S.
Employer Identification No.)
|
|
Classification
Code Number)
|
|
ITEM
1
|
|
DESCRIPTION
OF BUSINESS
|
|
3 |
|
ITEM
2
|
|
DESCRIPTION
OF PROPERTY
|
|
12 |
|
ITEM
3
|
|
LEGAL
PROCEEDINGS
|
|
15 |
|
ITEM
4
|
|
SUBMISSION
OF MATTERS TO VOTE OF SECURITY HOLDERS
|
|
16 |
|
|
|
|
|
|
|
PART
II
|
|||||
|
|
|
|
|
|
ITEM
5
|
|
MARKET
FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
|
|
16 |
|
ITEM
6
|
|
MANAGEMENT'S
DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
|
|
17 |
|
ITEM
7
|
|
FINANCIAL
STATEMENTS
|
|
24 |
|
ITEM
8
|
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
|
|
24
|
|
ITEM
8A
|
|
CONTROLS
AND PROCEDURES
|
|
24 |
|
ITEM
8B
|
|
OTHER
INFORMATION
|
|
25 |
|
|
|
|
|
|
|
PART
III
|
|||||
|
|
|
|
|
|
ITEM
9
|
|
DIRECTORS
AND EXECUTIVE OFFICERS OF THE REGISTRANT
|
|
25 |
|
ITEM
10
|
|
EXECUTIVE
COMPENSATION
|
|
27 |
|
ITEM
11
|
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
|
|
29 |
|
ITEM
12
|
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
|
|
30 |
|
ITEM
13
|
|
EXHIBITS
AND REPORTS ON FORM 8-K
|
|
30 |
|
ITEM
14
|
|
PRINCIPAL
ACCOUNTANT FEES AND SERVICES
|
|
31 |
|
|
|
SIGNATURES
|
|
32 |
|
|
|
INDEX
TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
F-1
|
|
Name
|
Location
|
Type
|
||
Plum
Mine
|
Storey
and Lyon County, Nevada
|
Gold
and silver lode claims- open pit test mining
|
||
Como
|
Lyon
County, Nevada
|
Gold
and silver lode claims
|
||
Gold
Canyon
|
Lyon
County, Nevada
|
Placer
gold claims
|
||
Spring
Valley
|
Lyon
County, Nevada
|
Placer
gold claims
|
||
Big
Mike
|
Pershing
County, Nevada
|
Lode
and Placer copper claims
|
·
|
Winfield
Debenture Payable issued 5/18/06 in the face amount of
$300,000
|
·
|
Winfield
Debenture Payable issued 6/21/06 in the face amount of
$300,000
|
·
|
Winfield
Debenture Payable issued 8/23/06 in the face amount of
$300,000
|
·
|
Longview
Debenture Payable issued 8/24/06 in the face amount of
$300,000
|
·
|
Winfield
Debenture Payable issued 12/12/06 in the face amount of
$100,000
|
|
FOR
|
AGAINST
|
ABSTAIN
|
TTL
SHS VOTED
|
|||||||||
TOTAL
|
290,625,009 | 121,421,168 | 3,526,375 | 415,572,552 | |||||||||
PERCENTAGE | 69.93 | % | 29.22 | % | 0.85 | % | 100.00 | % |
|
FOR
|
AGAINST
|
ABSTAIN
|
TTL
SHS VOTED
|
|||||||||
TOTAL
|
296,332,723 | 111,339,159 | 7,900,670 | 415,572,552 | |||||||||
PERCENTAGE | 71.31 | % | 26.79 | % | 1.90 | % | 100.00 | % |
|
FOR
|
AGAINST
|
ABSTAIN
|
TTL
SHS VOTED
|
|||||||||
TOTAL
|
364,143,994 | 41,743,259 | 9,685,299 | 415,572,552 | |||||||||
PERCENTAGE | 87.62 | % | 10.04 | % | 2.33 | % | 100.00 | % |
|
FOR
|
AGAINST
|
ABSTAIN
|
TTL
SHS VOTED
|
|||||||||
TOTAL
|
658,679,131 | 114,103,222 | 2,974,623 | 775,756,976 | |||||||||
PERCENTAGE | 84.91 | % | 14.71 | % | 0.38 | % | 100.00 | % |
Year
|
Quarter
|
High
|
Low
|
|||||||
|
|
|
|
|||||||
2005
|
First |
0.23
|
0.06
|
|||||||
2005
|
Second |
0.10
|
0.03
|
|||||||
2005
|
Third |
0.11
|
0.05
|
|||||||
2005
|
Fourth |
0.06
|
0.02
|
|||||||
2006
|
First |
.043
|
.014
|
|||||||
2006
|
Second |
.02
|
.009
|
|||||||
2006
|
Third |
.014
|
.003
|
|||||||
2006
|
Fourth |
.012
|
.003
|
Plan
Category
|
(a)
Number
of
Securities
to Be
Issued Upon
Exercise
of
Outstanding
Options,
Warrants,
and
Rights
|
(b)
Weighted-Average
Exercise Price
of
Outstanding
Options,
Warrants,
and Rights
|
|
(c)
Number of
Securities
Remaining
Available for
Future
Issuance
Under
Equity
Compensation
Plans (Excluding
Securities Reflected
in
Column (a))
|
||||||
Equity
Compensation Plans Approved by Stockholders
|
0
|
$
|
0
|
0
|
||||||
Equity
Compensation Plans Not Approved by Stockholders
|
0
|
$
|
0
|
0
|
||||||
Total
|
0
|
$
|
0
|
0
|
·
|
Weather
- As disclosed in this Quarterly Report, excessive rains has caused
material delays in our ability to operate as high levels of water
in our
leaching ponds and flooding have prevented us from being able to
leach
materials, a necessary part of the gold production process. Excessive
snows, which can occur in the area in which the Plum Mine is located,
would also hamper mining as the Plum Mine is an open pit
mine.
|
·
|
Current
Political Instability in the Middle East - Commodities such as gold
tend
to have widely fluctuating markets, and the current problems in areas
such
as Lebanon and Iraq, which are causing much political and economic
instability internationally, may very well be a contributing factor
to the
volatile gold market.
|
· |
Ore
body delineation
|
· |
Reserve
definition
|
· |
Completion
of reserve report
|
· |
Development
of comprehensive mine plan from exploration
results
|
· |
Increase
of ore reserves
|
· |
Augment
ability to mine and operate at more efficient
levels
|
· |
Intent
to cease mine operations until completion of the exploration program
and
related reports
|
· |
Expansion
of existing footprint in the Comstock
region
|
· |
Identification
of properties outside the Comstock region to complement Comstock
activities and increase Company
operations
|
Twelve
Months ended December 31, 2006
|
|
Twelve
Months ended December 31, 2005
|
Difference
|
|||||||
Revenue
|
$
|
1,255,013
|
$
|
2,632,112
|
($1,377,099
|
)
|
||||
Reclamation,
Exploration and Test Mining Expenses
|
1,985,611
|
4,810,643
|
(2,825,032
|
)
|
||||||
Consulting
& professional
|
468,951
|
773,390
|
(304,439
|
)
|
||||||
Liquidated
Damages
|
-0-
|
4,619,144
|
(4,619,144
|
)
|
||||||
Interest
Expense
|
2,779,420
|
2,309,479
|
469,941
|
|||||||
Net
Loss
|
($4,416,527
|
)
|
($11,353,026
|
)
|
$
|
6,936,499
|
|
Quarter
ended December 31, 2006
|
|
Quarter
ended December 31, 2005
|
|
Difference
|
|||||
Revenue
|
$
|
263,908
|
$
|
476,574
|
($212,666
|
)
|
||||
Reclamation,
Exploration and Test Mining Expense
|
601,384
|
940,327
|
(338,943
|
)
|
||||||
Consulting
& professional
|
63,613
|
55,614
|
(7,999
|
)
|
||||||
Liquidated
Damages
|
-0-
|
-0-
|
-0-
|
|||||||
Interest
Expense
|
681,769
|
703,892
|
(22,122)
|
)
|
||||||
Net
Loss
|
($1,211,206
|
)
|
($1,700,313
|
)
|
$
|
489,107
|
·
|
Winfield
Debenture Payable issued 5/18/06 in the face amount of
$300,000
|
·
|
Winfield
Debenture Payable issued 6/21/06 in the face amount of
$300,000
|
·
|
Winfield
Debenture Payable issued 8/23/06 in the face amount of
$300,000
|
·
|
Longview
Debenture Payable issued 8/24/06 in the face amount of
$300,000
|
·
|
Winfield
Debenture Payable issued 12/12/06 in the face amount of
$100,000
|
Dec.
31, 2006
|
|
Dec.
31, 2005
|
|||||
Convertible
Debentures Payable-Investors
|
$
|
2,600,812
|
$
|
6,220,409
|
|||
Convertible
Debentures Payable- Mandatory Redemption payment
|
5,886,059
|
6,885,184
|
|||||
Convertible
Debentures Payable- Failure to Deliver Shares
|
356,,348
|
356,348
|
|||||
Convertible
Notes Payable - 2006
|
1,300,000
|
-0-
|
|||||
Total
|
$
|
8,843,219
|
$
|
13,461,941
|
Name
|
Age
|
Position
|
||
|
|
|
||
William
J. Nance
|
63
|
Director
|
||
Robert
T. Faber
|
46
|
President,
Chief Executive Officer, and acting- Chief Financial
Officer
|
||
Jim
Golden
|
48
|
Chief
Operating Officer
|
|
|
|
|
Long-Term
|
|
|
|||||||||||||
|
|
|
|
Compensation
|
|
|
|||||||||||||
|
|
|
|
Awards
|
|
|
|||||||||||||
|
|
|
|
Securities
|
All
Other
|
||||||||||||||
|
Annual
Compensation(1)
|
Underlying
|
Compensation
|
|
|||||||||||||||
Name
and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Options
(#)
|
($)
|
TOTAL
|
|||||||||||||
|
|
|
|
|
|
|
|||||||||||||
Robert
T. Faber(2)(3)(5)
|
2006
|
$
|
147,500
|
$
|
0
|
0 |
$
|
0
|
$
|
147,500
|
|||||||||
President and Chief Executive Officer; |
2005
|
$
|
120,000
|
$
|
0
|
0
|
$
|
0
|
$
|
120,000
|
|||||||||
Chief
Financial Officer
|
2004
|
$
|
115,000
|
$
|
10,000
|
0
|
$
|
0
|
$
|
125,000
|
|||||||||
Jim
Golden, COO (4)(5)
|
2006
|
$
|
150,000
|
$
|
0
|
0
|
$
|
0
|
$
|
150,000
|
(1)
|
Executive
officers received certain perquisites, the value of which did not exceed
the lesser of $50,000 or 10% of that officer’s salary and bonus during
fiscal 2004.
|
(2)
|
Mr.
Faber has served as President and Chief Executive Officer since September
2004 and Chief Financial Officer since June
2003.
|
(3)
|
$32,500
of Mr. Faber’s 2006 salary has not yet been paid. We intend to pay this
amount in 2006.
|
(4)
|
Mr.
Golden has served as Chief Operating Officer since October 2006.
Prior to
October 2006, Mr. Golden served as a consultant to our
Company
|
(5)
|
$32,500
of Mr. Faber’s 2006 salary and $32,500 of Mr. Golden’s 2006 salary remains
unpaid.
|
Option
Awards
|
|
Stock
Awards
|
||||||||||||||||||||||||||
Name
and Principal Position
|
Number
of Securities Underlying Unexercised Options (#)
Exercisable
|
|
Number
of Securities Underlying Unexercised Options (#)
Unexercisable
|
|
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
|
|
Number
of Unearned Shares or Other Rights That Have Not Vested
|
|
Market
Value or Payout Value of Unearned Shares, Units or Other Rights That
Have
Not Vested
|
|||||||||||
Robert
T. Faber
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||
Jim
Golden
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Name
|
Fees
Earned or Paid in Cash
|
|
Stock
Awards
|
|
Option
Awards
|
|
Non-Equity
Incentive Plan Compensation
|
|
Nonqualified
Deferred Compensation Earnings
|
|
All
Other Compensation
|
|
Total
|
|||||||||
William
Nance
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Stanley
Hirschman
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Rex
Outzen
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Christopher
Aguilar
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Todd
Brown
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|
Shares
Beneficially Owned
|
||||||
Name
of Beneficial Owner
|
Number(1)
|
Percent(2)
|
|||||
|
|
|
|||||
Directors
and Executive Officers:
|
|
|
|||||
Robert
T. Faber (1) (2)
|
2,054,683
|
.01
|
%
|
||||
Jim
Golden
|
|||||||
Christopher
L. Aguilar (8)
|
157,775
|
0.01
|
%
|
||||
Todd
S. Brown (9)
|
―
|
0.0
|
%
|
||||
Stanley
A. Hirschman (8)
|
―
|
0.0
|
%
|
||||
Bill
Nance
|
―
|
0.0
|
%
|
||||
Rex
Outzen
|
―
|
0.0
|
%
|
||||
|
|||||||
All
directors and executive officers as a group (six persons)
|
2,212,458
|
.01
|
%
|
||||
|
|||||||
5%
Shareholders:
|
|||||||
John
W. Winfield(4)
|
3,493,417,808
|
70.4.
|
%
|
||||
Longview
Equity Fund and Longview International Equity Fund (5)
|
899,598,926
|
22.6
|
%
|
||||
Capital
Ventures International (6)
|
1,507,142,796
|
7.5
|
%
|
||||
Longview
Fund, L.P. (7)
|
832,012,020
|
19.2
|
%
|
||||
|
(1)
|
Includes,
when applicable, shares owned of record by such person’s minor children
and spouse and by other related individuals and entities over whose
shares
of common stock such person has custody, voting control, or power
of
disposition. Also includes shares of common stock that the identified
person had the right to acquire within 60 days of May 1, 2006 by
the
exercise of vested stock options.
|
(2)
|
Mr.
Faber has purchased additional shares through a Section 10(b)(5)
share
purchase program.
|
(3)
|
The
percentages shown include the shares of common stock that the person
will
have the right to acquire within 60 days of March 31, 2006. In calculating
the percentage of ownership, all shares of common stock which the
identified person will have the right to acquire within 60 days of
March
31, 2006 upon the conversion of convertible notes or the exercise
of
warrants or stock options are deemed to be outstanding for the purpose
of
computing the percentage of shares of common stock owned by such
person,
but are not deemed to be outstanding for the purpose of computing
the
percentage of shares of common stock owned by any other
person.
|
(4)
|
.Includes
shares beneficially owned by John W. Winfield, Santa Fe Financial
Corp.,
Portsmouth Square, Inc. and InterGroup Corporation. Mr. Winfield’s address
is 820 Moraga Drive, Los Angeles, California
90049.
|
(5)
|
The
address for Longview is c/o Redwood Grove Capital Management, 600
Montgomery Street, 44th
Floor, San Francisco, California
94111.
|
(6)
|
The
address for Capital Ventures International is c/o Heights Capital
Management, 101 California St., Suite 3250, San Francisco, CA
94111.
|
(7)
|
The
address for Longview Fund, L.P. is c/o Viking Asset Management,
LLC, 600
Montgomery Street, 44th
Floor, San Francisco, California 94111.
|
(8)
|
Was a director as of December 31, 2006 but resigned effective as of March 23, 2007 |
(9)
|
Resigned as a Director on _December 11, 2006 |
(a)
|
The
following documents are filed as part of this
Report:
|
(1)
|
Financial
statements filed as part of this
Report:
|
Report
of Independent Registered Public Accounting Firm
|
F
- 2
|
|||
Consolidated
Balance Sheet as of December 31, 2006
|
F
- 3
|
|||
Consolidated
Statements of Operations for the years ended December 31, 2006
and
2005
|
F
- 5
|
|||
Consolidated
Statements of Changes in Stockholders' Equity for the year ended
December
31, 2006 and 2005
|
F
- 6
|
|||
Consolidated
Statements of Cash Flows for the year ended December 31, 2006 and
2005
|
F
- 7
|
|||
Notes
to Consolidated Financial Statements
|
F-8-26
|
(2)
|
Exhibits
filed as part of this Report:
|
Exhibit
Number
|
Exhibit
|
|
3.1
|
Borrower
Security Agreement
|
|
23.1
|
Consent
of Jewett, Schwartz Wolfe & Associates
|
|
31.1
|
Certification
of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule
15d-14(a),
promulgated under the Securities Exchange Act of 1934, as
amended.
|
|
31.2
|
Certification
of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule
15d-14(a),
promulgated under the Securities Exchange Act of 1934, as
amended.
|
|
32.1
|
Certification
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
906 of
the Sarbanes-Oxley Act of 2002
|
|
32.2
|
Certification
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
906 of
the Sarbanes-Oxley Act of 2002
|
|
2005
|
|
2006
|
||||
Audit
fees
|
$
|
32,000
|
$
|
37,500
|
|||
Audit-related
fees
|
$
|
14,000
|
$
|
11,700
|
|||
Tax
fees
|
$
|
0
|
$
|
10,000
|
|||
All
other fees
|
$
|
0
|
$
|
0
|
Goldspring,
Inc.
|
||
|
|
|
/s/
Robert T. Faber
|
||
Robert
T. Faber
|
||
President,
Chairman and Director
(Principal
Executive Officer and
Principal
Financial Officer)
|
||
Date:
April _12_, 2007
|
/s/
Robert T. Faber
|
||
Robert
T. Faber
|
||
President,
Chairman and Director
(Principal
Executive Officer and
Principal
Financial and Accounting Officer)
|
||
Date:
April _12_, 2007
|
Page
|
||||
Report
of Independent Registered Public Accounting Firm
|
F-2
|
|||
Consolidated
Balance Sheet as of December 31, 2006
|
F-3
|
|||
Consolidated
Statements of Operations for the years ended December 31, 2006
and
2005
|
F-5
|
|||
Consolidated
Statements of Changes in Stockholders’ Deficiency for the years ended
December 31, 2006 and 2005
|
F-6
|
|||
Consolidated
Statements of Changes in Cash Flows for the years ended December
31, 2006
and 2005
|
F-7
|
|||
Notes
to Consolidated Financial Statements
|
F-8-25
|
|||
/s/
Jewett, Schwartz, Wolfe & Associates
|
|||
Jewett,
Schwartz, Wolfe & Associates
|
|||
Hollywood,
Florida
April
12, 2007
|
December
31, 2006
|
||||
ASSETS
|
||||
Current
Assets:
|
||||
Prepaid
expenses and other current assets
|
24,607
|
|||
Deferred
financing fees, net
|
774,397
|
|||
Total
Current Assets
|
799,004
|
|||
PLANT,
EQUIPMENT, AND MINERAL PROPERTIES
|
||||
Mineral
properties
|
1,669,837
|
|||
Plant
and Equipment
|
758,142
|
|||
Total
Property and Equipment
|
2,377,979
|
|||
Reclamation
deposit
|
377,169
|
|||
Total
Assets
|
$
|
3,554,152
|
December
31, 2006
|
||||
CURRENT
LIABILITIES
|
||||
Bank
overdraft
|
15,491
|
|||
Accounts
payable
|
519,671
|
|||
Accrued
expenses
|
1,115,174
|
|||
Accrued
liquidated damages
|
1,913,418
|
|||
Accrued
interest payable
|
1,613,825
|
|||
Derivative
Liability
|
398,312 | |||
Lease
obligations
|
29,943
|
|||
Convertible
debentures
|
10,143,218
|
|||
Promissory
Notes
|
2,475,000
|
|||
Other
notes payable & current portion of long-term debt
|
406,958
|
|||
Total
Current Liabilities
|
18,631,011
|
|||
LONG-TERM
DEBT AND OTHER LONG-TERM LIABILITIES
|
||||
Long-term
debt, net of current portion
|
23,336
|
|||
Long-term
lease obligation, net of current portion
|
45,231
|
|||
Long-term
reclamation liability
|
553,190
|
|||
Total
long-term debt and other Long-term Liabilities
|
621,757
|
|||
Total
Liabilities
|
19,252,768
|
|||
STOCKHOLDERS’
DEFICIT
|
||||
Common
stock, $.000666 par value, 3,9500,000,000 shares authorized, and
958,938,940 shares issued and outstanding
|
638,653
|
|||
Additional
paid-in capital
|
11,603,560
|
|||
Accumulated
deficit - Prior years
|
(23,524,302
|
)
|
||
Accumulated
deficit - Current year
|
(4,416,527
|
)
|
||
Total
Stockholders’ Deficiency
|
(15,698,616
|
)
|
||
Total
Liabilities and Stockholders’ Deficiency
|
$
|
3,554,152
|
Years
Ended
December
31,
|
|||||||
2006
|
2005
|
||||||
Revenue
from gold sales, net
|
$
|
1,255,013
|
$
|
2,632,112
|
|||
Cost
and Expenses
|
|||||||
Costs
applicable to sales (exclusive of depreciation and
amortization
shown separately below)
|
―
|
―
|
|||||
Depreciation
and amortization
|
288,305
|
302,753
|
|||||
Reclamation,
Exploration and Test Mining Expenses
|
1,985,611
|
4,810,643
|
|||||
General
and Administrative
|
573,683
|
1,183,255
|
|||||
Consultants
and Professional Fees
|
468,951
|
773,390
|
|||||
3,316,550
|
7,070,041
|
||||||
Operating
Loss
|
(2,061,537 |
)
|
(4,437,929 |
)
|
|||
|
|
|
|||||
Other
Income (Expense):
|
|||||||
Liquidated
damages expense (See Note 11)
|
―
|
(4,619,144
|
)
|
||||
Gain
on Sale of Fixed Assets
|
91,953
|
―
|
|||||
Other
-Settlement Agreement
|
85,000
|
―
|
|||||
Derivative
Change in Fair Value
|
247,477
|
―
|
|||||
Interest
income
|
―
|
13,526
|
|||||
Interest
expense
|
(2,779,420
|
)
|
(2,309,479
|
)
|
|||
(2,354,990
|
)
|
(6,915,097
|
)
|
||||
Net
Loss:
|
(4,416,527
|
)
|
(11,353,026
|
)
|
|||
Net
loss per common share - basic
|
(0.006
|
)
|
(0.045
|
)
|
|||
Basic
weighted average common shares outstanding
|
701,486,485
|
252,930,064
|
Common
Shares Issued
|
Par
value $.000666 per share
|
Additional
Paid-in
Capital
|
Treasury
Stock (at cost)
|
Accumulated
Deficit
|
Total
|
||||||||||||||
Balance
- December 31, 2004,
|
171,120,482
|
113,966
|
3,574,272
|
(67
|
)
|
(12,171,276
|
)
|
(8,483,105
|
)
|
||||||||||
Mandatory
redemption
|
(3,457,182
|
) |
(3,457,182
|
) | |||||||||||||||
March
2005 liquidated damages
|
59,203,484
|
39,430
|
1,736,674
|
1,776,104
|
|||||||||||||||
August
2005 liquidated damages
|
35,103,534
|
23,379
|
1,029,727
|
1,053,106
|
|||||||||||||||
Common
Stock issued for mining property
|
3,444,444
|
2,295
|
167,706
|
170,001
|
|||||||||||||||
Common
stock issued for debenture principal
|
28,201,478
|
18,782
|
1,100,212
|
1,118,994
|
|||||||||||||||
Common
stock issued for debenture interest
|
23,729,909
|
15,804
|
771,871
|
787,675
|
|||||||||||||||
December
2004 conversion shares issued in 2005
|
4,243,791
|
2,826
|
475,050
|
477,876
|
|||||||||||||||
Net
loss
|
(11,353,026
|
)
|
(11,353,026
|
)
|
|||||||||||||||
Balance
- December 31, 2005,
|
325,047,122
|
216,482
|
$
|
5,398,330
|
(67
|
)
|
$
|
(23,524,302
|
)
|
$
|
(17,909,557
|
)
|
|||||||
Retirement
of Treasury Shares
|
(100,000
|
)
|
(67
|
)
|
4
|
67
|
-0-
|
||||||||||||
Common
stock issued for debenture principal
|
433,316,756
|
288,589
|
4,321,082
|
4.609.671
|
|||||||||||||||
Common
stock issued for debenture interest
|
200,529,058
|
133,552
|
1,884,148
|
2.017.700
|
|||||||||||||||
Other
|
146,004
|
97
|
97
|
||||||||||||||||
Net
loss
|
(4,416,527
|
)
|
(4,416,527
|
)
|
|||||||||||||||
Balance,
December 31, 2006
|
958,938,940
|
638,653
|
$
|
11,603,560
|
$
|
-
|
$
|
(27,940,829
|
)
|
$
|
(15.698.616
|
)
|
Years
Ended December 31,
|
|||||||
|
2006
|
2005
|
|||||
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|||||||
Net
loss
|
$
|
(4,416,527
|
)
|
$
|
(11,353,026
|
)
|
|
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
|||||||
Depreciation
and amortization
|
739,348
|
445,193
|
|||||
Liquidated
damages from March 2004 financing and November 2004
restructuring
|
―
|
4,619,144
|
|||||
Interest
paid through the issuance of company stock
|
2,017,700
|
―
|
|||||
Changes in operating assets and liabilities | |||||||
Inventories
|
52,000
|
236,688
|
|||||
Prepaid
and other current assets
|
2,893
|
7,705
|
|||||
Other
current assets
|
(37,500
|
)
|
100,000
|
||||
Bank
overdraft
|
15,491
|
||||||
Accounts
payable
|
(750,670
|
)
|
677,275
|
||||
Accrued
expenses
|
1,046,195
|
2,803,339
|
|||||
Net
Change - Derivative Change Fair Value
|
(247,477
|
)
|
―
|
||||
Other
|
102,521
|
(541,472
|
)
|
||||
Net
cash used in operating activities
|
(1,476,026
|
)
|
(3,005,154
|
)
|
|||
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
|||||||
Equipment
/ acquisition deposit
|
―
|
(50,000
|
)
|
||||
Acquisition
of plant and equipment
|
10,969
|
(150,390
|
)
|
||||
Net
used in investing activities
|
10,969
|
(200,390
|
)
|
||||
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|||||||
Principal
payments on Note Payable
|
(154,308
|
)
|
(294,393
|
)
|
|||
Proceeds
from the issuance of note payable to related party
|
1,592,500
|
1,575,000
|
|||||
Net
cash provided by financing activities
|
1,438,192
|
1,280,607
|
|||||
Net
increase in cash and cash equivalents
|
(26,865
|
)
|
(1,924,937
|
)
|
|||
Cash
and cash equivalents, beginning of year
|
26,865
|
1,951,802
|
|||||
Cash
and cash equivalents, end of year
|
$
|
―
|
$
|
26,865
|
|||
Supplemental
disclosure of non-cash investing and financing
activities:
|
|||||||
Issuance
of notes for liquidated damages for failure to deliver
shares
|
$
|
―
|
$
|
403,175
|
|||
Issuance
of notes for mandatory redemption payment plus accrued interest
|
$
|
―
|
$
|
6,885,184
|
|||
Issuance
of company stock for acquisition of mining claims
|
$
|
―
|
$
|
170,000
|
|||
Issuance
of company stock for interest
|
$
|
2,017,700
|
$
|
787,675
|
|||
Issuance
of company stock for liquidated damages
|
$
|
―
|
$
|
2,829,210
|
|||
Issuance
of note for acquisition of mining claims
|
$
|
―
|
$
|
160,000
|
|||
Conversion
of debt into company’s common shares
|
$
|
4,609,671
|
$
|
1,118,994
|
MINERAL
PROPERTIES:
|
2006
|
2005
|
|||||
Placer
Gold Properties
|
$
|
100,000
|
$
|
100,000
|
|||
Big
Mike Copper Property
|
69,138
|
119,138
|
|||||
Plum
Gold Properties
|
1,360,699
|
1,360,699
|
|||||
Water
rights
|
90,000
|
90,000
|
|||||
Balance
|
$
|
1,619,837
|
$
|
1,669,837
|
|
2006
|
2005
|
|||||
Plant,
property and equipment at Plum Mine location
|
$
|
1,543,340
|
$
|
1,504,309
|
|||
Equipment,
corporate
|
18,195
|
18,195
|
|||||
Less
accumulated depreciation
|
(803,393
|
)
|
(515,087
|
)
|
|||
Balance
|
$
|
758,142
|
$
|
1,007,417
|
2006
|
2005
|
||||||
Balance
|
$
|
397,200
|
$
|
510,000
|
|||
Less
current portion
|
397,200
|
414,000
|
|||||
Non-current
portion
|
$
|
-
|
$
|
96,000
|
Issued
date
|
Face
amount
|
||||||
Windfield
Debenture Payable
|
5/15/2006
|
$
|
300,000
|
||||
Windfield
Debenture Payable
|
6/21/2006
|
300,000
|
|||||
Windfield
Debenture Payable
|
8/23/2006
|
300,000
|
|||||
Longview
Debenture Payable
|
8/24/2006
|
300,000
|
|||||
Windfield
Debenture Payable
|
12/12/2006
|
100,000
|
|||||
Total
|
$
|
1,300,000
|
2006
|
2005
|
||||||
Convertible
Debentures Payable-Investors
|
$
|
2,600,812
|
$
|
6,220,409
|
|||
Convertible
Debentures Payable- Mandatory Redemption payment
|
5,886,059
|
6,885,184
|
|||||
Convertible
Debentures Payable- Failure to Deliver Shares
|
356,348
|
356,348
|
|||||
Convertible
Notes Payable - 2006
|
1,300,000
|
-
|
|||||
Total
|
$
|
10,143,219
|
13,461,941
|
2006
|
2005
|
||||||
Promissory
Notes Payable-July 2005 Financing
|
$
|
1,200,000
|
$
|
1,200,000
|
|||
Promissory
Notes Payable-September 2005 Financing
|
300,000
|
300,000
|
|||||
Promissory
Notes Payable-December 2005 Financing
|
575,000
|
575,000
|
|||||
Promissory
Notes Payable-February 2006 Financing
|
250,000
|
-
|
|||||
Promissory
Notes Payable-March 2006 Financing
|
150,000
|
-
|
|||||
Total
|
$
|
2,475,000
|
$
|
2,075,000
|
2006
|
2005
|
||||||
Long-term
Debt-Current Plum Mine
|
$
|
250,000
|
$
|
350,000
|