UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended June 30, 2013

 

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Commission file number 000-54405

 

 

 

JAMESON STANFORD RESOURCES CORPORATION

(Exact name of registrant as specified in its charter)

 

Nevada		27-0585702
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

 

10785 West Twain Ave., Suite 200, Las Vegas, NV		89135
(Address of principal executive offices)		(Zip Code)

 

(702) 933-0808

(Registrant’s telephone number, including area code)

 

Not applicable.

(Former Name, former address and former fiscal year, if changed since last report)

 

Copies of Communications to:

Laura Anthony, Esq.

Legal & Compliance, LLC

330 Clematis Street, Suite 217

West Palm Beach, FL 33401

(561) 514-0936

Fax (561) 514-0832

 

Indicate by check mark whether the issuer (1) 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.

Yes [X] No [  ]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File 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 that the registrant was required to submit and post such files).

Yes [X] No [  ]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

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, issued and outstanding on August 15, 2013, was 31,560,000 shares.

 

 

TABLE OF CONTENTS

 

PART I - FINANCIAL INFORMATION
Item 1	Financial Statements		F-1
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations		3
Item 3	Quantitative and Qualitative Disclosures About Market Risk		7
Item 4	Controls and Procedures		7
PART II - OTHER INFORMATION
Item 1	Legal Proceedings		7
Item 1A	Risk Factors		7
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds		8
Item 3	Defaults Upon Senior Securities		8
Item 4	Mine Safety Disclosures		8
Item 5	Other Information		8
Item 6	Exhibits		8
Signatures			9

 

 

PART I - FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

  

JAMESON STANFORD RESOURCES CORPORATION

(AN EXPLORATION STAGE COMPANY)

CONSOLIDATED BALANCE SHEETS

(unaudited)

 

		June 30, 2013				December 31, 2012
ASSETS
CURRENT ASSETS
Prepaid Expenses		$	60,400			$	-
Total current assets			60,400				-
Property & equipment, net			39,513				40,367
Mineral Rights			25,869				25,869
Deposits			12,875				-
TOTAL ASSETS		$	138,657			$	66,236
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES
Accounts payable and accrued expenses		$	452,959			$	330,298
Accrued compensation			270,000				180,000
Cash Overdraft			18				-
Convertible debt, related party			135,000				185,000
Loans payable			48,108				45,342
Advances from related party shareholders, including accrued interest			362,344				49,993
Total current liabilities			1,268,429				790,633
Total Liabilities			1,268,429				790,633
STOCKHOLDERS’ DEFICIT
Common stock, authorized 350,000,000 shares, $.001 par value, 31,560,000 and 31,300,000 issued and outstanding, respectively		$	31,560			$	31,300
Add’l Paid in Capital (Deficit in par value)			379,532				(53,168	)
Accumulated deficit during exploration stage			(1,540,864	)			(702,529	)
Total Stockholders’ Deficit			(1,129,772	)			(724,397	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT		$	138,657			$	66,236

 

The accompanying notes are an integral part of these consolidated financial statements

 

 

JAMESON STANFORD RESOURCES CORPORATION

(AN EXPLORATION STAGE COMPANY)

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

 

																		Period from
																		Inception
		Three Months Ended								Six Months Ended								(Oct 12, 2010) to
		June 30, 2013				June 30, 2012				June 30, 2013				June 30, 2012				June 30, 2013
Revenue		$	-			$	-			$	-			$	-			$	89,994
Cost of Revenue			-				-				-				-				66,227
Gross Profit			-				-				-				-				23,767
Operating Expenses
Executive Compensation			47,450				50,000				94,243				50,000				274,243
Exploration and development costs			16,224				10,352				129,623				12,380				284,604
Exploration and development costs - related party			-				39,650				-				70,272				109,922
General and administrative			332,712				52,482				518,777				59,737				750,444
General and administrative - related party			-				-				10,783				-				38,283
Total Operating Expenses			396,386				152,484				753,426				192,389				1,457,496
Net Loss from Operations			(396,386	)			(152,484	)			(753,426	)			(192,389	)			(1,433,729	)
Other Expenses
Extinguishment of debt			(60,000	)							(60,000	)							(60,000	)
Interest expense, related parties			(12,738	)			(4,673	)			(22,019	)			(7,647	)			(44,245	)
Interest expense			(1,534	)			-				(2,890	)			-				(2,890	)
Net Loss before Income Taxes			(470,658	)			(157,157	)			(838,335	)			(200,036	)			(1,540,864	)
Income tax provision			-				-				-				-				-
Net Loss		$	(470,658	)		$	(157,157	)		$	(838,335	)		$	(200,036	)		$	(1,540,864	)
Basic and diluted (loss) per share		$	(0.01	)		$	(0.01	)		$	(0.03	)		$	(0.01	)		$	(0.06	)
Basic and diluted weighted average shares outstanding			31,557,143				25,000,000				31,429,282				25,000,000				26,573,185

 

The accompanying notes are an integral part of these consolidated financial statements

 

  

JAMESON STANFORD RESOURCES CORPORATION

(AN EXPLORATION STAGE COMPANY)

CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited)

 

										Period from
										Inception
		For Six Months Ended								(October 12, 2010) to
		June 30, 2013				June 30, 2012				June 30, 2013
Cash flows from operating activities
Net loss		$	(838,335	)		$	(200,036	)		$	(1,540,864	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation			4,784				3,140				12,786
Imputed interest			10,960				7,647				28,574
Shares issued for services			312,000				-				312,000
Shares issued for debt extinguishment			60,000				-				60,000
Changes in operating assets and liabilities
Prepaid expense			(60,400	)			-				(60,400	)
Deposits			(12,875	)			-				(12,875	)
Accounts payable and accrued expenses			122,661				51,869				413,377
Accrued interest			13,825				-				18,437
Accrued compensation			90,000				50,000				270,000
Net cash used in operating activities			(297,380	)			(87,380	)			(498,965	)
Cash flows from investing activities
Acquisition of mineral rights			-				(25,869	)			(25,869	)
Purchase of property and equipment			(3,929)				-				(52,298	)
Net cash used in investing activities			(3,929	)			(25,869	)			(78,167	)
Cash flows from financing activities
Cash Deficit			18				-				18
Proceeds from issuance of convertible debt, related party			-				70,000				185,000
Advances from related party shareholders			301,291				52,185				350,014
Members contributions			-				-				100
Loan payable			-				-				42,000
Net cash provided by financing activities			301,309				122,185				577,132
Net increase (decrease) in cash			-				8,936				-
Cash, beginning of year			-				6,991				-
Cash, end of year		$	-			$	15,927			$	-
Supplemental Information:
Cash paid for:
Taxes		$	-			$	-			$	-
Interest Expense		$	-			$	-			$	-
Liabilities assumed in merger		$	-			$	-			$	39,582
Settlement of debt with contributed capital		$	50,000			$	-			$	50,000

 

The accompanying notes are an integral part of these consolidated financial statements

  

 

JAMESON STANFORD RESOURCES CORPORATION

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

 

On October 29, 2012, Jameson Stanford Resources Corporation (“the Company”) merged with Bolcán Mining Corporation (Note 2). Prior to the Merger, the Company was a publically traded shell company with no business operations. The shell company was 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. As a result of the Merger, the Company is no longer considered a shell company.

 

The intended future operating activities of the Company are to pursue the development of certain mining 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 – 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. 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. On October 29, 2012, the Merger was closed. Effective as of the closing of the Merger, the CEO and Director of Jameson Stanford resigned from all positions with the Company and he returned, for cancellation, 52,500,000 shares of the Jameson Stanford’s common stock held in his name. Also at closing, the shareholder of Bolcán Mining was issued 25,000,000 shares of Jameson Stanford’s common stock. As of June 30, 2013 there were 31,560,000 shares of Jameson Stanford common stock outstanding, of which approximately 80% is held by the former shareholders of Bolcán. The merger has been treated as a reverse acquisition and recapitalization of a public company. Accordingly, the historic financial statements of the Company are the historic statements of Bolcán Mining Corporation, which was incorporated on April 11, 2012 in the State of Nevada.

 

NOTE 3 – 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 $1,540,864 as of the period ended June 30, 2013. 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.

 

  

JAMESON STANFORD RESOURCES CORPORATION

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

NOTE 4 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Accounting and Presentation

 

The accompanying condensed financial statements have been prepared in accordance with U. S. generally accepted accounting principles for interim financial statements. Accordingly, they omit or condense footnotes and certain other information normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles. The accounting policies followed for quarterly financial reporting conform with the accounting policies disclosed in Note 4 to the Notes to Condensed Consolidated Financial Statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2012. In the opinion of management, all adjustments that are necessary for a fair presentation of the financial information for the interim periods reported have been made. All such adjustments are of a normal recurring nature. The results of operations for the six months ended June 30, 2013 are not necessarily indicative of the results that can be expected for the entire year ending December 31, 2013. The unaudited financial statements should be read in conjunction with the financial statements and the notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2012.

 

NOTE 5 – TRANSACTIONS WITH MAJORITY OWNER AND OFFICER

 

Michael Stanford, the Company’s Chief Executive Officer and its majority shareholder (the “Majority Owner”) has made periodic advances to the Company to fund operations, which are unsecured and payable on demand after June 30, 2013. Interest is charged at the rate of 12%. During the six-month period ended June 30, 2013, the Majority Owner advanced $292,890 to the Company and the Company recorded $11,060 in interest expense. The outstanding advances totaled $362,344 as of June 30, 2013 including $12,330 of interest payable.

 

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 party totaled $0 for the six-month period ended June 30, 2013.

 

NOTE 6 – CONVERTIBLE NOTE-RELATED PARTY

 

In connection with a memorandum of understanding dated October 27, 2011, the Company received certain cash advances totaling $105,000 from a related party. The advances were unsecured, did not bear interest and were payable on demand.

 

 In 2011 and 2012, the Company borrowed $185,000 from related parties. The unpaid balance is convertible at the option of the related parties or the Company into common stock shares of the Company at the rate of one share of common stock for every two dollars of loan reduction. These conversion rights were not exercised and expired on December 31, 2012. The Company and one of the related parties have verbally agreed to extend the conversion rights related to a $135,000 portion of the note to December 31, 2013. Interest expense has been imputed at 12%. The note is due on demand. All advances under this facility are shown as a current liability in the accompanying financial statements.

 

In April 2013, $50,000 of the aforementioned $185,000 related party notes was extinguished. To extinguish the debt, an existing shareholder contributed 100,000 shares of the Company’s common stock to the Company; the shares were then transferred to the related party note holder. Based on a share value of $1.10 per share, which was the value of the Company’s common stock at the share issuance date of April 24, 2013, a loss on extinguishment of debt of $60,000 was recognized. The existing shareholder contributing the 100,000 shares did so with no consideration or compensation.

 

 

JAMESON STANFORD RESOURCES CORPORATION

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

The balance of the convertible note totaled $135,000 as of the period ended June 30, 2013. The imputed interest incurred for the period was $10,960 and cumulative interest totaled $28,573 at June 30, 2013.

 

NOTE 7 – NOTE PAYABLE

 

On May 11, 2012, an individual loaned the Company $42,000. The loan is guaranteed by the Majority Owner, bears interest at 12% per annum, and was extended to a due date of August 24, 2012. The balance of this note, including accrued interest of $6,108, was $48,108 as of the period ended June 30, 2013. As the loan has passed its due date, it is in default.

 

NOTE 8 – Contracts and lease commitments

 

Residential Office Lease

 

Commencing February 1, 2013 and continuing to January 31, 2014, the Company is renting residential office space from an entity controlled by the Majority Owner. The lease obligates the Company to monthly lease payments of $6,250.

 

Service Contracts

 

In February 2013, the Company contracted with a consulting group to receive consulting, investor relations and development services. This consulting agreement calls for the issuance of 200,000 shares of our unregistered common stock. The value of the services was based on the closing common share value on the share issuance date of April 2, 2013 which was $1.20 per share. Upon issuance of the shares during the six months ended June 30, 2013, the entire $240,000 value of the contract was recorded as a prepaid expense and is being amortized ratably over the life of the contract. As of June 30, 2013, $200,000 has been expensed and $40,000 remains as prepaid expense.

 

Also in February 2013, the Company contracted with a public relations company to provide the Company investor relations and development services, video production and distribution, public relations as well as various social media outreach and promotion services. This service contract requires the issuance of 60,000 shares of our unregistered common stock and minimum quarterly fees totaling $20,000 to be paid over a six month service period. The value of the services was based on the share value of the Company’s common stock on the closing common share issuance date of April 2, 2013 which was $1.20 per share. Upon issuance of the shares during the six months ended June 30, 2013, the entire $72,000 value of the contract was recorded as a prepaid expense and will be amortized ratably over the life of the contract. As of June 30, 2013, $51,600 has been expensed and $20,400 remains as prepaid expense.

 

NOTE 9 – equity transactions

 

On April 2, 2013, 200,000 shares of our unregistered common stock were issued to a consulting company. The contract calls for various consulting and investor relations services to be performed over six months. See Footnote 8 above.

 

On April 2, 2013, 60,000 shares of our unregistered common stock were issued to a marketing company. The contract calls for various social media and public relations services to be performed over six months. See Footnote 8 above.

 

NOTE 10 – SUBSEQUENT EVENT

 

The Company entered into an agreement with Michael Christiansen on August 13, 2013 to pay him $123,271.82 (the “Amount Due”) relating to a promissory note, compensation and expenses. These liabilities have been recorded in the accompanying financial statements. The Amount Due will be paid as follows: $10,500 on or before August 15, 2013; $10,500 on or before September 15, 2013; $10,500 on or before October 15, 2013; and the balance in installments of $15,000 beginning on the earlier of (a) the first day of the month following the date on which the company receive at least three million dollars ($3,000,000) of equity funding or (b) December 31, 2014. The Company have the right to prepay this amount without any prepayment penalty. In no event, however, shall the balance due be paid later than December 31, 2014. In the event of a change of control of our company, the company are obligated to pay in full the portion of the Amount Due that remains unpaid. Subject to completion of the payments due under the Agreement, the parties agreed to release all claims against each other related to or arising in connection with the matters that gave rise to our agreement to pay the Amount Due.

 

  

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2 of Part I of this report include forward-looking statements. These forward looking statements are based on our management’s current expectations and beliefs and involve numerous risks and uncertainties that could cause actual results to differ materially from expectations. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “proposed,” “intended,” or “continue” or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other “forward-looking” information. Many factors could cause our actual results to differ materially from those projected in these forward-looking statements, including but not limited to: variability of our future revenues and financial performance; risks associated with product development and technological changes; the acceptance of our products in the marketplace by potential future customers; general economic conditions. You should be aware that the occurrence of any of the events described in this Quarterly Report could substantially harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities could decline. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, levels of activity, performance or achievements. We are under no duty to update any of the forward-looking statements after the date of this Quarterly Report to conform these statements to actual results.

 

THE COMPANY

 

Business Development

 

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 May 7, 2012, we entered into an Acquisition Agreement and Plan of Merger, as amended on July 24, 2012 and on October 24, 2012 (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 Mining”). Pursuant to the Merger Agreement, we issued 25,000,000 shares of our Rule 144 restricted common stock in exchange for 100% of Bolcán Mining’s issued and outstanding capital stock.

 

On May 2, 2012, we completed a 7-for-1 forward split of all outstanding shares of our common stock and a corresponding increase in our authorized common stock. 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 to the terms of the Merger Agreement, on October 29, 2012 Sub Co merged with and into Bolcán Mining (the “Merger”) with Bolcán Mining surviving the Merger as our wholly owned subsidiary. After the Merger, there were 31,300,000 shares of our common stock outstanding, of which approximately 80% were held by the former shareholders of Bolcán Mining. 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.

 

Description of Bolcán Mining Corporation’s Business

 

Bolcán Mining was incorporated on April 11, 2012 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, Bolcán Mining acquired certain lode mining claims and mineral leases related to the Star Mining District and Spor Mountain Mining District projects.

 

 

Effective as of June 30, 2012, pursuant to an Asset Purchase Agreement (the “APA”) between Bolcán Mining and the Bolcán Group LLC (“Bolcán Group”) which was formed in October 12, 2010 by Mr. Stanford, Bolcán Mining purchased all of the assets and assumed certain liabilities of the Bolcán Group resulting in a combination of the two companies.

 

The operating activities of the Bolcán Group were inconsequential until October 2011 and consisted primarily of historical site research performed by Mr. Stanford. Mr. Stanford has other mining interests and provides services to the mining industry that are not part of Bolcán Mining.

 

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 current mining claims and mineral properties into producing projects.

 

Since late 2011, Bolcán Mining has 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, Bolcán Mining 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, Bolcán Mining has acquired excavation rights and special permitting related to deposits of alluvial minerals and silica sand located at Ogden Bay, Utah.

 

Our business development strategy for 2013-2014 comprises the following activities:

 

	Initiate small-scale production of copper ore at the Chopar Mine project site;
	Ramp Chopar Mine copper ore production to profitability and positive cash flow;
	Commission independent engineering reports to validate reserves in compliance with SEC Industry Guide 7
	Subcontract production at Ogden Bay Minerals to generate near term cash flow;
	Initiate production at the Dugway Minerals project site in 2013;
	Develop larger scale production plan and capital investment program; and
	Fund capital investment for significant production expansion.

 

Projects

 

Our current active projects include:

 

Star Mountain (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 the Company’s geological analysis, magnetometry studies and reverse circulation drilling samples, it is estimated that total inferred reserves at the Star Mountain site may ultimately involve more than 100,000,000 metric tons of copper ore plus additional precious and base metals.

 

 

Spor Mountain (Spor Mountain Mining District) - The Spor Mountain project consists of nine mining claims and three metalifferous mineral lease sections located in Juab County, Utah. The Company’s Spor Mountain/Dugway Minerals project involves a total area of 2,098 acres. Based on the Company’s preliminary geological analysis and two prospect pit excavations, it is estimated that total inferred reserves at the Dugway Minerals site may ultimately involve more than 4,000,000 ounces of silver, commercial concentrations of beryllium and other precious and base metals. Planned project activities at Spor Mountain in 2013 include prospecting, exploration and development

 

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. The Company was commissioned by the State of Utah Division of Natural Resources, USDA Natural Resources Conservation Service and Weber County Emergency Management to restore habitat, repair damage, dredge silt and sand and remove debris from the Weber River. 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. The project contains deposits of alluvial mineral deposits that are created and replenished from 125 miles of river low from the nearby Wasatch Mountin Range. These alluvial mineral deposits have commercial grades of ziron, usable silica, and other heavy mineral ore.

 

Products

 

We intend to develop our project mining claims, mineral leases and excavation rights to produce the following specialized mining products:

 

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.

 

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.

 

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.

 

Results of Operations for the three and six months ended June 30, 2013 and 2012.

 

The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this Quarterly Report. The results discussed below are for the three and six months ended June 30, 2013 and 2012. For comparative purposes, we are comparing the three and six months ended June 30, 2013 to the three and six months ended June 30, 2012.

 

Revenue. No revenue was generated for the three and six months ended June 30, 2013 and the three and six months ended June 30, 2012.

 

Cost of revenue. The cost of revenue for the three and six months ended June 30, 2013 and the three and six months ended June 30, 2012 was zero as we had no revenues during these periods as discussed above.

 

Operating Expenses. Operating expenses were $396,386 and $152,484 for the three months ended June 30, 2013 and June 30, 2012, respectively. The operating expenses were $753,426 and $192,389 for the six months ended June 30, 2013 and June 30, 2012, respectively. The increase  is due to increased expenses related to public and investor relations, costs for legal and professional fees related to public filings and increased exploration costs at our Star Mountain project.

 

Operating Loss. The operating loss was $396,386 and $152,484 for the three months ended June 30, 2013 and June 30, 2012, respectively. The operating loss was $753,426 and $192,389 for the six months ended June 30, 2013 and June 30, 2012, respectively. The increase  is due to increased expenses related to public and investor relations, costs for legal and professional fees related to public filings and compliance and increased exploration costs at our Star Mountain project.

 

 

Interest Expense. Interest expense, including interest expense - related parties, was $14,272 and $4,673 for the three months ended June 30, 2013 and June 30, 2012, respectively. Interest expense, including interest expense related parties was $24,909 and $7,647 for the six months ended June 30, 2013 and June 30, 2012, respectively. The increase was primarily related to increases in borrowing from related parties and the costs of that borrowing.

 

Net Loss. Our net loss was $470,668 and $157,157 for the three months ended June 30, 2013 and June 30, 2012, respectively. Our net loss was $838,335 and $200,036 for the six months ended June 30, 2013 and June 30, 2012, respectively. The increase in net loss was a result of the increase in operating loss and interest expense discussed above.

 

Liquidity and Capital Resources

 

Liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements. The Company had a cash overdraft of $18 and $0 of cash as of June 30, 2013 and December 31, 2012, respectively. As a result, our current cash position is not sufficient to fund our cash requirements during the next twelve months, including operations and capital expenditures.

 

Net cash used in operating activities was $297,380 and $87,380 for the six months ended June 30, 2013 and June 30, 2012, respectively. This increase was primarily a result of an increase in general and administrative expenses.

 

Net cash provided by financing activities was $301,309 and $122,185 for the six months ended June 30, 2013 and June 30, 2012, respectively. We had total assets at June 30, 2013 of $138,657 compared to $66,236 as of December 31, 2012. The increase was primarily a result of increases in advances from our majority shareholder.

 

Cash Requirements

 

Our future capital requirements will depend on numerous factors, including the extent we continue exploration activities, our ability to generate revenues, and our ability to control costs. We will be reliant upon shareholder loans, private placements or public offerings of equity to fund any kind of operations. While our majority shareholder may continue to lend us funds for our working capital needs, we have not entered into any agreements for any future loans. In the event we are unable to borrow funds needed for our business, or we are unable to repay our current obligations when due, we will have to seek additional financing, and no assurances can be given that such financing would be available on a timely basis, on terms that are acceptable or at all. Failure to obtain such additional financing could result in delay or indefinite postponement of our operations which represent our sole business which would materially adversely affect our business, results of operations and financial condition and threaten our financial viability.

 

We do not currently have any contractual restrictions on our ability to incur debt, and, accordingly, we could incur significant amounts of indebtedness to finance operations. Any such indebtedness could contain covenants which would restrict our operations.

 

Going Concern

 

Our financial statements have been prepared assuming that we will continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Our continued losses and negative operating cash flows raise substantial doubt about our ability to continue as a going concern.

 

Related Party Transactions

 

At June 30, 2013 and December 31, 2012, we had outstanding net advances and loans from related parties of $362,344 and $49,993, respectively.

 

At June 30, 2013 and December 31, 2012, we had outstanding convertible debt from a related party of $135,000 and $185,000, 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.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a “smaller reporting company”, we are not required to provide the information under Item 3.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

Evaluation of Disclosure Controls and Procedures

 

As required by Rule 13a-15(b) under the Securities Exchange Act of 1934 (the “Exchange Act”), we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report, June 30, 2013. This evaluation was carried out under the supervision and with the participation of our chief executive officer, Michael Stanford, and our chief financial officer, Mr. Robbie Chidester (the “Certifying Officers”). Based upon that evaluation, our Certifying Officers concluded that as of the end of the period covered by this report, June 30, 2013, our disclosure controls and procedures are ineffective in timely alerting management to material information relating to us and required to be included in our periodic filings with the Securities and Exchange Commission (the “Commission”).

 

Our certifying officer further concluded that our disclosure controls and procedures are ineffective to ensure that information required to be disclosed by the issuer in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms and are also ineffective to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our chief executive officer and chief financial officer, to allow time for decisions regarding required disclosure.

 

Changes in Internal Controls Over Financial Reporting

 

There were no changes in the Company’s internal controls over financial reporting identified in connection with the evaluation of our controls performed during the quarter ended June 30, 2013 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II - OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS.

 

We are not presently a party to any material litigation, nor to the knowledge of management is any litigation threatened against us that may materially affect us.

 

We entered into an agreement with Michael Christiansen related to his claim that he owned 2,250,000 shares of our common stock reflected in a Schedule 13D dated March 21, 2013 he filed with the Securities and Exchange Commission. See “Part II, Item 5 – Other Information.”

 

ITEM 1A. RISK FACTORS.

 

As a “smaller reporting company”, we are not required to provide disclosure under this Item 1A.

 

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

 

On April 2, 2013, we issued 200,000 shares of our common stock to a consulting company as compensation for consulting and investor relations services valued at $1.20 per share.

 

On April 2, 2013, we issued 60,000 shares of our common stock to a marketing company for investor relations and development services, video production and distribution, public relations as well as various social media outreach and promotion services valued at $1.20 per share.

 

The recipients are accredited or otherwise sophisticated investors who had access to business and financial information on the Company. The issuances were exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”) in reliance on an exemption provided by Section 4(2) of that act.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES.

 

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.

 

ITEM 5. OTHER INFORMATION.

 

We entered into an agreement with Michael Christiansen on August 13, 2013 to pay him $123,271.82 (the “Amount Due”) relating to a promissory note, compensation and expenses. The Amount Due will be paid as follows: $10,500 on or before August 15, 2013; $10,500 on or before September 15, 2013; $10,500 on or before October 15, 2013; and the balance in installments of $15,000 beginning on the earlier of (a) the first day of the month following the date on which we receive at least three million dollars ($3,000,000) of equity funding or (b) December 31, 2014. We have the right to prepay this amount without any prepayment penalty. In no event, however, shall the balance due be paid later than December 31, 2014. In the event of a change of control of our company, we are obligated to pay in full the portion of the Amount Due that remains unpaid. Subject to completion of the payments due under the Agreement, the parties agreed to release all claims against each other related to or arising in connection with the matters that gave rise to our agreement to pay the Amount Due.

 

ITEM 6. EXHIBITS.

 

31.1		Section 302 Certificate of Chief Executive Officer.*
31.2		Section 302 Certificate of Principal Financial and Accounting Officer.*
32.1		Section 906 Certificate of Chief Executive Officer.*
32.2		Section 906 Certificate of Chief Financial Officer.*
101.INS		XBRL INSTANCE DOCUMENT **
101.SCH		XBRL TAXONOMY EXTENSION SCHEMA **
101.CAL		XBRL TAXONOMY EXTENSION CALCULATION LINKBASE **
101.DEF		XBRL TAXONOMY EXTENSION DEFINITION LINKBASE **
101.LAB		XBRL TAXONOMY EXTENSION LABEL LINKBASE **
101.PRE		XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE **

*		Filed herewith.
**		In accordance with Regulation S-T, the XBRL-formatted interactive data files that comprise Exhibit 101 in this Quarterly Report on Form 10-Q shall be deemed “furnished” and not “filed”.

 

 

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 thereunto duly authorized.

 

	Jameson Stanford Resources Corporation
Date August 19, 2013	By:	/s/ Michael Stanford
		Michael Stanford
		Chairman and Chief Executive Officer
		(Principal Executive Officer)
Date: August 19, 2013
	By:	/s/ Robbie Chidester
		Robbie Chidester, Chief Financial Officer (Principal Financial and Accounting Officer)