CAN CAL RESOURCES LTD - FORM 10-Q

Attached files

file	filename
EX-32 - CAN CAL RESOURCES LTD	v223259_ex32.htm
EX-31.2 - CAN CAL RESOURCES LTD	v223259_ex31-2.htm
EX-31.1 - CAN CAL RESOURCES LTD	v223259_ex31-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2011

¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 000-26669

CAN-CAL RESOURCES LTD.

(Exact name of registrant as specified in its charter)

Nevada	88-0336988
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

8205 Aqua Spray Avenue

Las Vegas, Nevada

(Address of principal executive offices)

(702) 243-1849

(Registrant’s telephone number, including area code)

Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes ¨ No

Indicate by checkmark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data Filed required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period the registrant was requires to submit and post such files)

x Yes ¨ No

Large accelerated filer ¨	Accelerated filer ¨

Non-accelerated filer ¨ (Do not check if a smaller reporting company)	Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ¨ No x

The number of shares of Common Stock, $0.001 par value, outstanding on May 18, 2011 was 35,066,203.

CAN-CAL RESOURCES LTD.

FORM 10-Q

TABLE OF CONTENTS

			Page

PART I – FINANCIAL INFORMATION			3
	Item 1. Financial Statements		3
		Balance Sheets as of March 31, 2011 (Unaudited) and December 31, 2010	3
		Condensed Statements of Operations (Unaudited)	4
		Statement of Stockholders’ Equity (Deficit) (unaudited)	5
		Condensed Statements of Cash Flows (unaudited)	6
		Notes to Condensed Financial Statements (Unaudited)	7
	Item 2. Management’s Discussion and Analysis		21
	Item 3. Quantitative and Qualitative Disclosures about Market Risk		25
	Item 4T. Controls and Procedures		25

PART II – OTHER INFORMATION			25
	Item 1. Legal Proceedings		25
	Item 1A. Risk Factors		26
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		26
	Item 3. Defaults Upon Senior Securities		26
	Item 4. Submission of Matters to a Vote of Security Holders		26
	Item 5. Other Information		26
	Item 6. Exhibits		27

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

CAN-CAL RESOURCES LTD.

(AN EXPLORATION STAGE COMPANY)

CONDENSED BALANCE SHEETS

	March 31,			December 31,
	2011			2010
	(Unaudited)
ASSETS

Current assets:
Cash	$	53,704		$	17,202
Other current assets		13,535			18,427
Total current assets		67,239			35,629

Property and equipment (net of accumulated depreciation of $29,647 and $27,454, respectively)		36,293			38,486

Total assets	$	103,532		$	74,115

LIABILITIES AND STOCKHOLDERS' (DEFICIT)

Current liabilities:
Accounts payable	$	38,402		$	98,795
Accounts payable, related parties		75,000			60,000
Accrued interest		483,063			469,852
Accrued interest, related parties		1,196			680
Accrued salaries		434,004			403,328
Notes payable, including related party amounts of $53,191 and $57,191 at March 31, 2011 and December 31, 2010, respectively		413,741			417,741
Unearned rental revenues		29,792			9,167
Total current liabilities		1,475,198			1,459,563

Total liabilities		1,475,198			1,459,563

Commitments and contingencies

Stockholders' (deficit):
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding		-			-
Common stock, $0.001 par value, 100,000,000 shares authorized, 33,877,869 and 30,711,203 shares issued and outstanding as of March 31, 2011 and December 31, 2010, respectively		33,877			30,711
Subscriptions payable, 966,751 and 2,193,166 shares at March 31, 2011 and December 31, 2010, respectively		58,005			131,590
Additional paid-in capital		8,894,668			8,707,834
(Deficit) accumulated during exploration stage		(10,358,216	)		(10,255,583	)
Total stockholders' (deficit)		(1,371,666	)		(1,385,448	)

Total liabilities and stockholders' (deficit)	$	103,532		$	74,115

See accompanying notes to financial statements.

CAN-CAL RESOURCES LTD.

(AN EXPLORATION STAGE COMPANY)

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)

							March 22, 1995
	For the three months ended						(inception) to
	March 31,						March 31,
	2011			2010			2011

Material sales	$	-		$	-		$	245,500
Cost of sales		-			-			263,400

Gross loss		-			-			(17,900	)

Operating expenses:
General and administrative		62,303			90,188			6,761,031
Exploration costs		7,848			7,997			557,198
Depreciation		2,193			2,495			252,747
Officer salary		30,000			30,000			991,176
Impairment of operating assets		-			-			443,772
Total operating expenses		102,344			130,680			9,005,924

Loss from operations		(102,344	)		(130,680	)		(9,023,824	)

Other income (expense):
Other income		3,000			-			53,798
Interest income		-			15			52,945
Rental revenue		16,875			6,875			372,783
Gain on sale of fixed assets		-			-			26,801
Interest expense		(20,164	)		(15,237	)		(1,367,119	)
Total other income (expense)		(289	)		(8,347	)		(860,792	)

Loss before provision for income taxes		(102,633	)		(139,027	)		(9,884,616	)

Provision for income taxes		-			-			-

Net loss from continuing operations		(102,633	)		(139,027	)		(9,884,616	)

Income from discontinued operations
Income from discontinued operations		-			-			116,400
Loss on disposal of operations (net of taxes)		-			-			(590,000	)

Net (loss)	$	(102,633	)	$	(139,027	)	$	(10,358,216	)

Weighted average number of common shares outstanding - basic and fully diluted		33,671,721			30,728,863

Net (loss) per share - basic and fully diluted	$	(0.00	)	$	(0.00	)

See accompanying notes to financial statements.

CAN-CAL RESOURCES LTD.

(AN EXPLORATION STAGE COMPANY)

STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

																								(Deficit)
																		Foreign						accumulated
	Common stock											Rescission						currency			Additional			during			Total
	Number of						Subscription			Subscription		liability			Unamortized			translation			paid-in			exploration			stockholders'
	shares			Amount			receivable			payable		receivable			equity grants			adjustment			capital			stage			equity (deficit)

Balance, March 22, 1995		-		$	-		$	-		$	-	$	-		$	-		$	-		$	-		$	-		$	-

Common shares issued for services		-			-			-			-		-			-			-			-			-			-
Net loss																									(1,000	)		(1,000	)

Balance, December 31, 1995		-			-			-			-		-			-			-			-			(1,000	)		(1,000	)

Common shares issued for services		3,441,217			3,400			-			-		-			-			-			625,000			-			628,400
Prior period adjustment, investment in joint venture		-			-			-			-		-			-			-			-			497,900			497,900
Net loss																									(497,000	)		(497,000	)

Balance, December 31, 1996		3,441,217			3,400			-			-		-			-			-			625,000			(100	)		628,300

Common shares issued for services		3,006,435			3,000			-			-		-			-			-			1,051,400			-			1,054,400
Net loss																									(1,044,700	)		(1,044,700	)

Balance, December 31, 1997		6,447,652			6,400			-			-		-			-			-			1,676,400			(1,044,800	)		638,000

Common shares issued for cash		557,509			600			-			-		-			-			-			211,200			-			211,800
Foreign currency translation adjustment		-			-			-			-		-			-			8,500			-			-			8,500
Net loss																									(353,000	)		(353,000	)

Balance, December 31, 1998		7,005,161			7,000			-			-		-			-			8,500			1,887,600			(1,397,800	)		505,300

Common shares issued for cash		1,248,621			1,200			-			-		-			-			-			572,600			-			573,800
Foreign currency translation adjustment		-			-			-			-		-			-			(11,800	)		-			-			(11,800	)
Realized foreign currency translation loss		-			-			-			-		-			-			3,300			-			-			3,300
Prior period Adjustment		-			-			-			-		-			-			-			-			15,000			15,000
Elimination of subsidiary upon disposal		-			-			-			-		-			-			-			-			116,400			116,400
Net loss																									(1,038,500	)		(1,038,500	)

Balance, December 31, 1999		8,253,782			8,200			-			-		-			-			-			2,460,200			(2,304,900	)		163,500

Common shares issued for cash		1,119,009			1,200			-			-		-			-			-			948,400			-			949,600
Net loss																									(962,500	)		(962,500	)

Balance, December 31, 2000		9,372,791			9,400			-			-		-			-			-			3,408,600			(3,267,400	)		150,600

Common shares issued for cash		785,947			800			-			-		-			-			-			81,500			-			82,300
Net loss																									(704,500	)		(704,500	)

Balance, December 31, 2001		10,158,738			10,200			-			-		-			-			-			3,490,100			(3,971,900	)		(471,600	)

Common shares issued for cash		1,093,280			1,100			-			-		-			-			-			269,900			-			271,000
Common shares issued for services		92,292			100			-			-		-			-			-			23,800			-			23,900
Options granted for services		-			-			-			-		-			-			-			7,100			-			7,100
Common shares issued for repayment of note payable, related party in the amount of $119,800, including accrued interest of $71,800		309,677			300			-			-		-			-			-			119,500			-			119,800
Warrants granted for loan fees on convertible notes payable, related party		-			-			(16,700	)		-		(16,700	)		(16,700	)		-			16,700			-			(33,400	)
Common shares issued for loan fees on convertible notes payable, related party		30,000			-			(13,500	)		-		(13,500	)		(13,500	)		-			13,500			-			(27,000	)
Deemed interest on beneficial conversion feature of notes payable, related party		-			-			-			-		-			-			-			20,500			-			20,500
Amortization of loan fees		-			-			8,200			-		8,200			8,200			-			-			-			24,600
Net loss																									(709,300	)		(709,300	)

Balance, December 31, 2002		11,683,987			11,700			(22,000	)		-		(22,000	)		(22,000	)		-			3,961,100			(4,681,200	)		(774,400	)

Common shares issued for cash		823,410			800			-			-		-			-			-			163,900			-			164,700
Common shares issued for services		381,260			400			-			-		-			-			-			63,800			-			64,200
Options granted for services		-			-			-			-		-			-			-			61,300			-			61,300
Common shares issued for repayment of note payable, related party common shares issued for repayment of note payable, related party in the amount of $78,300, including accrued interest of $43,300		364,305			400			-			-		-			-			-			77,900			-			78,300
Deemed interest on beneficial conversion feature of notes payable, related party		-			-			-			-		-			-			-			38,300			-			38,300
Amortization of loan fees		-			-			15,000			-		15,000			15,000			-			-			-			45,000
Net loss																									(711,100	)		(711,100	)

Balance, December 31, 2003		13,252,962			13,300			(7,000	)		-		(7,000	)		(7,000	)		-			4,366,300			(5,392,300	)		(1,033,700	)

Common shares issued for cash		1,564,311			1,600			-			-		-			-			-			306,400			-			308,000
Common shares issued for exercise of warrants		701,275			700			-			-		-			-			-			124,900			-			125,600
Common shares issued for services		390,224			400			-			-		-			-			-			73,800			-			74,200
Warrants granted for services		-			-			-			-		-			-			-			12,200			-			12,200
Interest expense for warrants granted		-			-			-			-		-			-			-						-			280,200
Common shares issued in satisfaction of accounts payable and accrued liabilities in the amount of $229,400		917,747			900			-			-		-			-			-			228,500			-			229,400
Common shares issued for repayment of note payable in the amount of $99,700, including accrued interest of $14,700		702,760			700			-			-		-			-			-			99,000			-			99,700
Common shares issued for repayment of note payable, related party in the amount of $82,700		330,747			300			-			-		-			-			-			82,400			-			82,700
Deemed interest on beneficial conversion feature of notes payable, related party		-			-			-			-		-			-			-			17,600			-			17,600
Amortization of loan fees		-			-			7,000			-		7,000			7,000			-			-			-			21,000
Net loss																									(1,030,500	)		(1,030,500	)

Balance, December 31, 2004		17,860,026			17,900			-			-		-			-			-			5,591,300			(6,422,800	)		(813,600	)

Common shares issued for cash		762,500			800			-			-		-			-			-			152,700			-			153,500
Common shares issued for exercise of warrants		349,545			300			-			-		-			-			-			69,500			-			69,800
Net loss																									(421,800	)		(421,800	)

Balance, December 31, 2005		18,972,071			19,000			-			-		-			-			-			5,813,500			(6,844,600	)		(1,012,100	)

Common shares issued for cash		2,448,213			2,400			-			-		-			-			-			642,100			-			644,500
Common warrants exercised for cash		174,000			200			-			-		-			-			-			43,300			-			43,500
Common shares issued for services		19,500			-			-			-		-			-			-			5,000			-			5,000
Common shares issued in satisfaction of accounts payable and accrued liabilities		385,714			400			-			-		-			-			-			80,600			-			81,000
Common shares issued in satisfaction of notes payable-related parties		56,821			100			-			-		-			-			-			11,800			-			11,900
Common shares issued in satisfaction of convertible debenture, (including accrued interest of $1,895)		206,767			200			-			-		-			-			-			41,700			-			41,900
Common shares issued for asset acquisition		1,000,000			1,000			-			-		-			-			-			399,000			-			400,000
Option granted to officers and directors		-			-			-			-		-			-			-			123,500			-			123,500
Warrants granted for services		-			-			-			-		-			-			-			2,200			-			2,200
Warrants granted in satisfaction of accounts payable and accrued liabilities		-			-			-			-		-			-			-			65,400			-			65,400
Warrants granted in satisfaction of notes payable-related parties		-			-			-			-		-			-			-			9,600			-			9,600
Warrants granted in satisfaction of convertible debenture		-			-			-			-		-			-			-			40,000			-			40,000
Net loss																									(621,000	)		(621,000	)

Balance, December 31, 2006 (Restated)		23,263,086			23,264			-			-		-			-			-			7,277,736			(7,465,600	)		(164,600	)

Common shares issued for cash		492,795			492			-			-		-			-			-			188,698			-			189,190
Common warrants exercised for cash		745,372			745			-			-		-			-			-			185,598			-			186,343
Common shares issued for services		4,000			4			-			-		-			-			-			2,010			-			2,014
Common shares issued in satisfaction of accrued wages of $22,000, related party		50,000			50			-			-		-			-			-			21,950			-			22,000
Debt forgiveness, related party		-			-			-			-		-			-			-			147,419			-			147,419
Net loss																									(604,913	)		(604,913	)

Balance, December 31, 2007 (Restated)		24,555,253			24,555			-			-		-			-			-			7,823,411			(8,070,513	)		(222,547	)

Common shares issued for cash		32,500			33			-			-		-			-			-			8,091			-			8,124
Net loss																									(1,016,661	)		(1,016,661	)

Balance, December 31, 2008		24,587,753			24,588			-			-		-			-			-			7,831,502			(9,087,174	)		(1,231,084	)

Common shares issued for cash		2,926,600			2,926			(25,000	)		-		-			-			-			362,899			-			340,825
Common shares issued for debt conversion to related parties of $398,593, including accrued interest of $29,093		3,188,741			3,189			-			-		-			-			-			395,404			-			398,593
Warrants granted in connection with debt conversion		-			-			-			-		-			-			-			78,961			-			78,961
Common shares issued for services		122,000			122			-			-		-			-			-			15,338			-			15,460
Common shares cancelled per rescission order		(126,898	)		(127	)		-			-		-			-			-			(55,660	)		-			(55,787	)
Rescission liability receivable		-			-			-			-		(12,125	)		-			-			-			-			(12,125	)
Net loss																						-			(595,554	)		(595,554	)

Balance, December 31, 2009		30,698,196			30,698			(25,000	)		-		(12,125	)		-			-			8,628,444			(9,682,728	)		(1,060,711	)

CAN CAL RESOURCES LTD - FORM 10-Q - May 18, 2011

Attached files