UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

(Mark One)

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

 

For the quarterly period ended

September 30, 2013

 

or

 

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

  

For the transition period from

to

  

Commission File Number

000-52767

  

SUNERGY, INC.

(Exact name of registrant as specified in its charter)

  

Nevada		26-4828510
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

  

14362 N. Frank Lloyd Wright Blvd., Suite 1000, Scottsdale, AZ		85260
(Address of principal executive offices)		(Zip Code)

  

480.477.5810

(Registrant’s telephone number, including area code)

N/A

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

  

Indicate by check mark 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. YES S 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 S NO £

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the 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	S

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES £ NO S

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS

 

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. YES £ NO £

 

APPLICABLE ONLY TO CORPORATE ISSUERS

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

2,056,055,314 as of September 30, 2013

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

The interim financial statements included herein are unaudited but reflect, in management's opinion, all adjustments, consisting only of normal recurring adjustments that are necessary for a fair presentation of our financial position and the results of our operations for the interim periods presented. Because of the nature of our business, the results of operations for the quarterly period ended September 30, 2013 are not necessarily indicative of the results that may be expected for the full fiscal year.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUNERGY, INC. (An Exploration Stage Company)

CONDENSED CONSOLIDATED BALANCE SHEETS

 

		September 30,				December 31,
		2013				2012
ASSETS
Current assets
Cash and cash equivalents		$	1,342			$	451
Prepaid expenses			–				22,248
Total current assets			1,342				22,699
Long-term assets
Exploratory properties			1,753,497				1,753,497
Property and equipment, net			142,089				174,904
Total long-term assets			1,895,585				1,928,401
Total assets		$	1,896,927			$	1,951,100
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities		$	418,293			$	315,623
Notes payable, current portion			48,085				100,585
Convertible debt, net of discount			103,854				–
Accrued interest			481,500				317,700
Accounts payable to related parties			123,552				139,976
Derivative liability			9,871				–
Total current liabilities			1,185,155				873,884
Total liabilities			1,185,155				873,884
Commitments and Contingencies
Stockholders' equity
Common stock, authorized 3,750,000,000 shares, par value $0.001, issued and outstanding on September 30, 2013 and December 31, 2012 is 2,056,055,314 and 1,852,288,983 respectively			2,056,057				1,852,290
Additional paid-in capital			4,571,449				4,425,047
Accumulated deficit during exploration stage			(5,915,734	)			(5,200,121	)
Total stockholders' equity			711,772				1,077,216
Total liabilities and stockholders' equity		$	1,896,927			$	1,951,100

 

The accompanying notes are an integral part of these statements.

 

 

SUNERGY, INC. (An Exploration Stage Company)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

		Three Months Ended September 30,								Nine Months Ended September 30,								January 28, 2003 (Inception) to September 30,
		2013				2012				2013				2012				2013
Revenue		$	–			$	–			$	–			$	–			$	–
Operating expenses
Depreciation and amortization			13,468				13,038				39,316				39,114				129,926
General and administrative			33,221				54,746				158,094				187,861				877,277
Management salary			10,500				11,696				31,500				78,696				783,196
Exploration and development			16,711				20,032				79,860				120,378				941,652
Professional fees			24,536				83,623				188,960				309,916				1,202,305
Total expenses			98,436				183,135				497,730				735,965				3,934,356
(Loss) from operations			(98,436	)			(183,135	)			(497,730	)			(735,965	)			(3,934,356	)
Other income (expenses)
Interest expense			(95,534	)			(59,400	)			(214,551	)			(186,800	)			(1,814,565	)
Financing costs			–				–				(4,000	)			(160,281	)			(167,481	)
Loss on change in fair value of derivatives			(474	)			–				(474	)			–				(474	)
Gain on sale of fixed assets			1,142				–				1,142				–				1,142
(Loss) before income taxes			(193,302	)			(242,535	)			(715,613	)			(1,083,046	)			(5,915,734	)
Provision for income taxes			–				–				–				–				–
Net (loss)		$	(193,302	)		$	(242,535	)		$	(715,613	)		$	(1,083,046	)		$	(5,915,734	)
Loss per common share:
Basic & Diluted		$	(0.00	)		$	(0.00	)		$	(0.00	)		$	(0.00	)
Weighted average shares outstanding:
Basic & Diluted			1,998,979,952				1,786,027,080				1,919,077,473				1,653,998,124

 

The accompanying notes are an integral part of these statements.

 

 

SUNERGY, INC. (An Exploration Stage Company)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

		Nine months ended September 30,								January 28, 2003 (Inception) to September 30,
		2013				2012				2013
Operating activities
Net loss		$	(715,613	)		$	(1,083,046	)		$	(5,915,734	)
Adjustments to reconcile net loss
Depreciation and amortization			39,316				39,114				129,926
Stock-based compensation			88,750				84,000				639,640
Non-cash interest expense			54,750								1,171,077
Incentive shares			–				160,281				165,281
Loss on change in fair value of derivative liability			474								474
Change in assets and liabilities
(Increase)/decrease in prepaid expenses			1,000				–				200,000
Increase/(decrease) in accrued interest payable			163,800				186,800				602,000
Increase/(decrease) in accounts payable and accrued liabilities			232,839				(13,383	)			759,163
Increase/(decrease) in accrued-related party			3,575				337,726				533,166
Net cash used by operating activities			(131,109	)			(288,508	)			(1,715,007	)
Investment activities
Acquisition of property and equipment			(6,500	)			(2,500	)			(284,514	)
Cash acquired through acquistion of subsidiary			–				–				39
Net cash provided/(used) by investment activities			(6,500	)			(2,500	)			(284,475	)
Financing activities
Repayments of loans from related parties			–				–				(31,915	)
Proceeds from issuance of debt			25,000				12,500				300,000
Proceeds from issuance of convertible debt			75,000				–				75,000
Proceeds from the sale of stock			38,500				193,071				1,644,471
Contributed capital			–				–				13,268
Net cash provided by financing activities			138,500				205,571				2,000,824
Net increase / (decrease) in cash			891				(85,437	)			1,342
Cash, beginning of period			451				85,515				–
Cash, end of period		$	1,342			$	78			$	1,342
Supplemental Information:
Interest paid		$	–			$	–			$	–
Income taxes paid		$	–			$	–			$	–
Non-cash activities:
Stock issued for service as prepaid expenses		$	–			$	7,250			$	–
Debt issued to acquire assets		$	–			$	–			$	487,500
Stock issued to acquire assets		$	–			$	–			$	500,000
Stock issued as reduction of accrued expenses		$	101,669			$	–			$	–
Assets acquired through acquisition of subsidiary		$	–			$	–			$	753,497
Liabilities assumed through acquisition of subsidiary		$	–			$	–			$	42,725
Shares issued to acquire subsidiary		$	–			$	–			$	290,000
Stock issued to settle operational advances		$	–			$	–			$	–
Stock issued to settle debt		$	110,000			$	396,000			$	971,624
Warrants issued to acquire subsidiary		$	–			$	–			$	420,811

  

The accompanying notes are an integral part of these statements.

 

 

SUNERGY, INC.

(An Exploration Stage Company)

Notes to the Condensed Financial Statements

September 30, 2013

 

NOTE 1. GENERAL ORGANIZATION AND BUSINESS

 

SUNERGY, Inc. (The Company) was organized in the state of Nevada on January 28, 2003 and is an exploration phase mineral and mining company.

 

The Company has precious and rare earth element (“REE”) mineral properties located in the Republic of Ghana and Sierra Leone, Africa and has not yet determined whether these properties contain reserves that are economically recoverable. The recoverability, if any, of amounts from these properties will be dependent upon the discovery of economically recoverable reserves located within the property interests held by the Company, the ability of the Company to obtain necessary financing to satisfy the expenditure requirements under the property agreements to complete the development of the properties and upon future profitable production or proceeds for the sale thereof.

 

Since inception, through the date of this report, the Company has not generated any revenue and is considered an exploration stage entity as defined by accounting principles generally accepted in the United States (“US GAAP”).

 

NOTE 2. CONDENSED FINANCIAL STATEMENTS

 

The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at September 30, 2013, and for all periods presented herein, have been made.

 

In accordance with Article 8-03 of Regulation S-X certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2012 audited financial statements. The results of operations for the period ended September 30, 2013 are not necessarily indicative of the operating results for the full year.

 

The consolidated financial statements include the accounts of Sunergy, Inc and its subsidiaries, Mikite Gold Resources Limited, a Ghanaian company, and Allied Mining and Supply LLC, a Nevada limited liability company (100%). Allied Mining and Supply LLC also has one 100% owned subsidiary, a Sierra Leone company, Allied Mining and Supply Ltd which are 100% consolidated in the financial statements. All material inter-company accounts and transactions have been eliminated.

 

Use of Estimates

 

The 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 reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash and Cash Equivalents

 

Cash and cash equivalents include cash in banks and financial instruments which mature within three months of the date of purchase.

 

 

Earnings per Share

 

Basic earnings per share excludes dilution and is computed by dividing net income (loss) by the weighted-average common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. The Company has potentially dilutive common shares consisting of warrants, which are excluded from the diluted earnings per share computation in periods where the Company has incurred net loss.

 

Stock Based Compensation

 

The Company has on occasion issued equity and equity linked instruments to non-employees in lieu of cash to various vendors for the receipt of goods and services and, in certain circumstances the settlement of short-term loan arrangements. The applicable GAAP establishes that share-based payment transactions with nonemployees shall be measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable.

 

In these transactions, we issue unregistered and restricted equity instruments along with equity-linked instruments that are convertible into unregistered and restricted shares of our common stock.

 

While we have 1,025,000,000 shares of freely-traded stock with a quoted market price (a Level 1 input within the GAAP hierarchy), the fair value of the unregistered and restricted shares issued as valued by the quoted market price does not reflect the economic substance of the transactions; correspondingly, the quoted market price is not the most reliably measurable fair value.

 

When unregistered common shares and equity-linked instruments convertible into unregistered common shares are issued for the settlement of short-term financing arrangements (that are not initially convertible), the reacquisition price of the extinguished financing arrangement is determined by the value of the debt which is more clearly evident, and no additional inducement expense is recognized.

 

In situations in which we issue unregistered restricted common shares and equity-linked instruments in exchange for goods and services, and the value of the goods and services are not the most reliably measurable, we recognize the fair value of the unregistered restricted equity instruments based on the value of similar instruments issued in private placements in exchange for cash in the most recent transactions (a Level 2 input within the GAAP hierarchy). We have determined this methodology reflects the risk adjusted fair value of our unregistered restricted equity instruments using a commercially reasonable valuation technique.

 

Recent Accounting Guidance Not Yet Adopted

 

The Company has reviewed recently issued accounting pronouncements and does not expect any to have a material impact on our financial position, results of operations, or cash flows.

 

NOTE 3. GOING CONCERN

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. However, the Company has not generated any revenue and continues to incur operating losses and negative cash flows. This raises substantial doubt about the Company’s ability to continue as a going concern. These financials do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

 

While we have been successful in raising enough capital to pay for professional and administrative fees to file our delinquent financial statements, we have not had the ability to raise any significant additional capital to materially advance our exploration and mining operations. We continue to actively pursue additional sources of capital, however, there is no guarantee these efforts will be successful.

 

 

NOTE 4. PROPERTY, PLANT AND EQUIPMENT

 

Property, Plant and Equipment consisted of the following at September 30, 2013 and December 31, 2012:

 

		September 30,				December 31,
		2013				2012
Exploration equipment		$	253,760			$	247,260
Rolling stock			13,500				13,500
Office furniture and equipment			4,753				4,753
Subtotal		$	272,013			$	265,513
Less accumulated depreciation			(129,924	)			(90,609	)
Property, and equipment – net		$	142,089			$	174,904

 

NOTE 5. NOTES PAYABLE

 

During the period ended September 30, 2013 we accrued $163,800 of penalty expense, $12,500 of original issue discount interest expense, $28,854 of debt discount on convertible debt, $9,397 as initial derivative liability on the convertible debt agreement, and $4,000 of financing costs related to shares issuance as an inducement to enter into a short-term commercial financing agreement. As of September 30, 2013, our outstanding notes payable balance was $48,085 and $103,854 in convertible note agreements net of debt discount, of which $48,085 are in default as of September 30, 2013. Balance of notes payable at December 31, 2012 totaled $100,585. The individual notes in default carry daily interest penalties between $100 and $500.

 

On March 15, 2013, the Company entered into a short-term commercial financing agreement of $25,000 due and payable in 180 days at an amount of $30,000. The Company issued 2,000,000 equity units at $0.002 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.004 per share as incentive to the lien holder to enter into the financing arrangement.

 

On May 15, 2013, the Company settled $60,000 of outstanding notes payable with payment of 30,000,000 common stock units consisting of one common share and one 12 month share purchase warrant exercisable at $0.003.

 

On April 24, 2013, the Company entered into a securities purchase agreement and convertible note agreement wherein the Company received $47,500 of principal which carries an 8% per annum rate and is due and payable in 9 months. The note holder can convert the note into common stock of the Company starting at 180 days after the date of the note. The conversion price has been set at the 56% of the average of the lowest three trading days close prices in the 10 days prior to notice of conversions. Prepayment may be made but incur penalty of paying principal plus accrued interest and an additional percentage based upon the number of days since the date of issuance of the note as follows: 1) 20% if paid within 30 days of the note date; 2) 25% if paid between 31 and 60 days of the note date; 3) 30% if paid between 61 and 90 days of the note date; 4) 35% if paid between 91 and 120 days of the note date; 5) 40% if paid between 121 and 150 days of the note date; 6) 45% if paid between 151 and 180 days of the note date. After 180 days from the date of the note, the Company has no right to prepay the note.

 

On June 17, 2013, the Company entered into a convertible note agreement wherein the Company received $27,500 and carries an 8% per annum rate and is due and payable in 9 months. The convertible note carries the same terms as the April 24, 2013 convertible note.

 

On September 13, 2013, the Company settled $30,000 of outstanding notes payable with payment of 30,000,000 common stock units of one common share and one 12 month share purchase warrant exercisable at $0.002.

 

On October 31, 2013, the Company repaid the securities purchase agreement and convertible not agreement to the lender in full with no conversion. Per the agreement, the Company repaid the note at $67,000.

 

 

NOTE 6. STOCKHOLDERS’ EQUITY

 

Common Stock

 

The following provides additional information for certain stock transactions that occurred since January 1, 2013. For additional details for all stock transactions please see the consolidated statement of changes in stockholders’ equity as reported in the Company’s 10-K for the period ended December 31, 2012 and filed with the Securities Exchange Commission on April 16, 2013.

 

A summary of shares issued follows:

 

	·	During the quarter ended March 31, 2013, the Company issued 2,500,000 equity units at $0.002 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.005 per share for total cash of $5,000; , the Company issued 5,000,000 equity units at $0.0025 per unit for prepaid consulting services with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.005 per share.; the Company issued 2,000,000 equity units at $0.002 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.004 per share for incentive to provide short-term commercial financing in the amount of $25,000.
	·	During the quarter ended June 30, 2013, the Company issued 12,366,332 equity units at $0.0015 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share for total cash of $18,500; the Company issued 2,500,000 equity units at $0.002 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share for total cash of $5,000; the Company issued 20,000,000 equity units at $0.002 per unit for consulting services with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share; the Company issued 30,000,000 equity units at $0.002 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share to settle $60,000 in outstanding notes payable.
	·	During the quarter ended September 30, 2013, the Company issued 3,333,333 equity units at $0.0015 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share for total cash of $5,000; the Company issued 5,000,000 equity units at $0.001 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.002 per share for total cash of $5,000; the Company issued 10,000,000 equity units at $0.0015 per unit for consulting services with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share equivalently $15,000; the Company issued 67,733,333 equity units at $0.0015 per unit to settle outstanding accounts payable with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share equivalently $101,669; the Company issued 13,333,333 equity units at $0.0015 per unit to settle outstanding related party payables with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share or $20,000 equivalently; the Company issued 30,000,000 equity units at $0.001 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.002 per share to settle $30,000 in outstanding notes payable. During the third quarter of 2013, the former chairman of the Board of Directors forgave outstanding amounts owed under his compensation due for 2012. The amount forgiven, $28,500, has been recorded as an increase in additional paid-in capital.

Outstanding Warrants

 

On January 23, 2012 the Company extended the expiration date of all outstanding warrants as of December 31, 2011 for six months. In accordance with the modification, the Company recognized the estimated excess value of the modified award over the fair value of the original award immediately before its terms were modified, based on the pertinent factors on the modification date. The excess value totaling $160,281 was estimated by using a Black-Scholes pricing model, and comparison of the unregistered and restricted shares underlying the warrants to those that are currently freely trading. The Company used a historically derived volatility rate of 151%; the remaining contractual terms for each award between one month and one year; a risk free rate of 0.52%; and an estimated forfeiture rate of 55% for its Black-Scholes model assumptions.

 

 

On September 30, 2013 the Company had warrants outstanding summarized in the table below:

 

				Warrants				Exercise				Expiration
				Outstanding				Price				Date
					2,000,000				0.005			30-Nov-13
					5,000,000				0.005			15-Aug-13
					5,000,000				0.005			6-Dec-13
					2,500,000				0.005			6-Jan-14
					2,000,000				0.004			15-Mar-14
					1,333,333				0.003			24-Apr-14
					15,000,000				0.004			22-Apr-14
					1,666,666				0.003			30-Apr-14
					30,000,000				0.003			21-May-14
					2,500,000				0.003			19-May-14
					1,333,333				0.003			25-May-14
					1,333,000				0.003			27-May-14
					6,700,000				0.003			23-May-14
					5,000,000				0.003			31-May-14
					10,000,000				0.003			01-Jul-14
					6,400,000				0.003			19-Jul-14
					3,333,333				0.003			24-Jul-14
					40,000,000				0.003			01-Aug-14
					8,000,000				0.003			01-Aug-14
					13,333,333				0.003			01-Aug-14
					13,333,333				0.003			01-Aug-14
					30,000,000				0.002			13-Sep-14
					5,000,000				0.002			18-Sep-14
	Total				210,766,331

 

 

 

Information relating to warrant activity during the reporting period follows:

 

Weighted

Average

Number of

Contingent

Exercise

Warrants

Warrants

Price

Total Warrants outstanding at December 31, 2012

347,092,849

–

0.0053

Plus: Warrants Issued

203,766,331

–

0.0030

Less: Warrants Exercised

–

–

–

Less: Warrants Expired

(340,092,849

)

–

0.0053

Total Warrants outstanding at September 30, 2013

210,766,331

0.0044

 

NOTE 7. RELATED PARTY TRANSACTIONS

 

Certain related parties assist in financing operations by personally paying expenses which the company considers to be in the nature of accounts payable since the obligations are incurred within the normal course of business and classified as related party accounts payable. Unpaid officer and director fees are classified as accounts payable as they are normal operating business expenses of the Company. The balance due to related parties was $123,552, and $139,976 as of September 30, 2013 and December 31, 2012, respectively.

 

NOTE 8. SIGNIFICANT EVENTS

 

On August 13, 2013, Gary Houck, a member of our Board of Directors, resigned from the Board of Directors. He has not been replaced as of the time of this filing.

 

NOTE 9. SUBSEQUENT EVENTS

 

Since September 30, 2013, our Company received short-term loans totaling $67,000, of which the proceeds were used to repay the convertible debt agreement dated April 24, 2013. CEO and President, Garrett Hale, has provided short-term operating loans to the Company in the amount of $10,000. Additionally, we have raised $5,000 in funding from private placements with investors.

 

Our Pampana River Exploration License is a renewable license, EXPL 5/2009 and our renewal was prepared and submitted on July 11, 2013. As of the date of this filing, our renewable exploration license application is still pending, though we anticipate approval of such license, we have no guarantee that it will be approved and should we not receive approval, an adjustment may be required at that time.

 

 

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

 

FORWARD-LOOKING STATEMENTS

 

This quarterly and unaudited report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 

Our unaudited financial statements are stated in United States dollars and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.

In this quarterly and unaudited report, unless otherwise specified, all dollar amounts are expressed in United States dollars. All references to "common stock" refer to the common shares in our capital stock.

 

As used in this quarterly and unaudited report, the terms "we", "us", "our", "our company" and "Sunergy" mean Sunergy, Inc. and our wholly owned subsidiaries, Mikite Gold Resources Limited, a Ghanaian company, Allied Mining and Supply LLC, a Nevada limited liability, which wholly owns Allied Mining and Supply Limited, a Sierra Leone Company and our newly incorporated wholly owned subsidiary Sunergy Sierra Leone, Limited a Sierra Leone Company, unless otherwise stated.

 

Overview and Current Business

 

We were incorporated in the State of Nevada, USA, on January 28, 2003. We are an exploration stage company engaged in the acquisition, exploration and development of mineral properties with a view to exploiting any mineral deposits we discover that demonstrate economic feasibility. Our current exploration efforts are focused on our two properties; one of which is located in Sierra Leone, Africa and the other is located in Ghana, Africa. We are embarking on our development stage of operations by pursuing direct mining operations in Ghana, Sierra Leone and this year, Liberia geared to producing cash flow from the extraction of Gold, Diamonds and Black Sands wherever available in our operations.

 

Nyinahin Concession, Ghana: Potential Joint Development Proposed

 

The Nyinahin concession is located between two geological gold belts, the Bibiani Belt to the west and the Asankrangwa to the east.  The license allows for the exploration and mining of gold, silver, base metals and diamonds. About 80% of the Nyinahin concession lies to the west of the Offin River within the Ashanti region of Ghana. There are several historical pits and adits with a strong clustering of artisan pits located along the Offin River. Three old gold prospects exist on the concession. The property is accessed via the main Kumasi-Bibiani trunk road. It falls under the jurisdiction of the Atwima Mponua District Assembly with headquarters at Nyinahin. The Offin River area offers strong alluvial operations potential as well as the underlying bedrock is a continuation of the Keegan Esaase-Jeni Project. The large area west of the Offin River area contain some significant geological anomalies that warrant additional exploration activities. In the overall, this concession represents a significant future development opportunity for our Company.

 

 

Due to our limited funding, our activities during the current fiscal year have been limited to maintaining “good-standing” status of our concession. However, we are now in discussion with a private American owned Ghanaian company who currently operates alluvial gold operations on the Offin river in nearby Dunkwa, in Ghana and has adequate equipment and equipment manufacturing facilities to commence a bulk sampling operation designed to determine the longer term viability of alluvial operations on our Nyinahin concession with the goal of establishing a Joint Venture on our alluvial mineralization. We are currently preparing a request for permission to start this operation. Updates will be provided.

 

Pampana River Concession, Sierra Leone: Pending Renewal

 

The Pampana River concession is an alluvial mining concession consisting of Exploration License No. EXPL 5/2009 which was issued to Allied Mining and Supply Ltd. (AMS) on August 12, 2009. This is a renewable license and all renewal applications, permits and associated fees have been paid and filed with the Minerals Commission in Sierra Leone. Once the renewal is finalized, a 4 year EXPL license will be granted. Should the renewal not be approved, there will be an adjustment to our financials to reflect any change in status. We are optimistic that this matter will be resolved prior to year end 2013.

 

The license area is located in the Kholifa Rowalla, Kafe Simiria and Tane Chiefdoms in the Tonkolili District of the Northern Province of Sierra Leone covering an area of 141.3 square kilometers. The concession is situated on the western fringes of the southern Sula Mountains greenstone belt and for most of the northern and central part it straddles the Pampana River. On the west of the southern part, the concession runs along the Pampana River. The property is south of the Sula Mountains in the Greenstone belt, around 120 miles east of the capital, Freetown.

 

A report dated August 22, 2012 from Hazen Research in Colorado in part states as follows: (The complete report is available for review on our website www.sunergygold.com )

 

MINERALOGICAL EXAMINATION

 

“An initial microscopic examination of the Stockpile sample showed major ilmenite, zircon, and subordinate monazite and quartz. To provide evidence of the occurrence of randomly distributed free placer gold, a 100 g grab sample of the blended Stockpile sample was separated using a high-intensity rare earth hand magnet to separate the paramagnetic ilmenite from the nonmagnetic constituents, including the gold. Both magnetic products were assayed for gold and PGMs. The results show that about 99% of the gold is in the nonmagnetic product which assayed 14.4 g/t Au and represents about 28% of the total weight of the sample. Based on the results of this preliminary investigation, the Stockpile sand contains appreciable gold which is easily recoverable by magnetic and gravity separation.”

 

We are currently engaged in further mineralogical studies to determine the final design of a pilot plant facility, which once finalized will be deployed in our operation in Sierra Leone.

 

Management has changed its model of operations going forward by adding a much needed cash flow component in addition to our exploration activities on the Pampana river. Exploration funding is scarce at best and opportunities for operators with equipment and crews to operate that equipment are numerous to assist local miners in advancing their operations dramatically. We have adopted this strategy of growth which should enable us to self-finance both our mining and equipment expansion as well as our future exploration activities.

 

Commencement of Cash Flow Operations – Liberia proposed 2013 -2014

 

David Price, The Dredgemaster, who recently joined our management team as Director of Alluvial Operations in Sierra Leone and Liberia, has plans to increase our dredging capacity as required up to six dredges in Liberia and a further six dredges in Sierra Leone this year, subject only to financing. He will arrive in Liberia by the end of November and meet our geologist from Sierra Leone, a local Liberian geologist and Management from the US and Liberia to inspect and approve the deployment of a dredge and crew to Liberia to work in a sponsorship role with Liberian owner operators in a profit share plan under existing class c mining licenses on the St. Paul river. This is a known diamond and gold area and we are currently testing a quantity of recoverable black sands. Sand itself is also being looked at as a viable marketable byproduct of a dredging operation. Results of this visit should be available in early December and rains permitting, operations will be scheduled to begin. Diamonds, gold and black sands will be being recovered on a daily basis, once overburden is dredged away and we expect to have reportable inventory and or cash flow by year end.

 

 

Commencement of Cash Flow Operations – Sierra Leone proposed 2013 - 2014

 

David Price, Dredgemaster will travel to Sierra Leone after his Liberian visit and accompany our geologist, Management and local owner operators of mining licenses to our proposed mining sites for inspection and evaluation. We plan to deploy an initial dredge, wash plant and crew to an area on the Sewa river in Sierra Leone in a Sponsorship arrangement with local Sierra Leonean operators to extract diamonds, gold and black sands under a profit share plan. This is a proven diamond and gold mineralized area and we will be directly in charge of all operations. This opportunity lends itself, on receipt of satisfactory results to grow dramatically in the near term. Implementation will commence once the river is safe to operate with divers and our dredge(s). Again, this operation is projected to produce diamond, gold and black sand recovery opportunities on a daily/weekly basis leading to reportable inventory/cash flow by year end if the rains cooperate and most certainly by January 2014. Financial results from dredge production will be being used to design a dredge financing program, whereby the actual cash flow that is Sunergy’s share may be directly assigned to pay the investor for the dredge. More details on this as we progress.

 

Management intends to work closely with local artisanal operators in both Liberia and Sierra Leone so that cash flow becomes the focus of 2013- 2014 operations. Expansion of operations focused on cash flow is being pursued in a highly prospective diamond, gold and black sands areas that are in addition to the Pampana project.

 

Affordable Housing Project: Humanitarian Results Providing Sustainable Villages At A Profit

 

During this reporting period, our Company entered into an Exclusive Partnership Agreement with ATA Systems of Orland, Florida to represent their affordable manufactured housing, and building products throughout Africa. This representation allows equal profit sharing on developments that occur under our agreement. This agreement requires no capital contribution on our part. The Company will participate akin to a real estate broker and paid upon the facilitation of successful projects. Initial response has been excellent, and while no contracts have resulted as yet, our opportunity has already grown through Africa. We continue to build relationships and work with government entities to see where we may assist in satisfy the critical affordable and safe housing needs. Other surrounding countries also have such a need and have expressed interest in housing units as well as Hospitals, Schools and Clinic facilities. Management is optimistic that this business will grow rapidly and the factories that manufacture these buildings are prepared to put factories in the countries that are using their products. This creates both jobs and trade items for export.

 

Liquidity and Capital Requirements

 

As we do not have all the funds necessary to cover our projected operating expenses for the next twelve month period, we will be required to raise additional funds through the issuance of equity securities, through loans or through debt financing. There can be no assurance that we will be successful in raising the required capital or that actual cash requirements will not exceed our estimates. We intend to fulfill any additional cash requirement through the sale of our equity securities.

 

If we are not able to obtain the additional financing on a timely basis, if and when it is needed, we will be forced to scale down or perhaps even cease the operation of our business.

 

The continuation of our business is dependent upon obtaining further financing, a successful program of exploration and/or development, and, finally, achieving a profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

 

There are no assurances that we will be able to obtain further funds required for our continued operations. As noted herein, we are pursuing various financing alternatives to meet our immediate and long-term financial requirements. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, we will be unable to conduct our operations as planned, and we will not be able to meet our other obligations as they become due. In such event, we will be forced to scale down or perhaps even cease our operations.

 

 

We continue to explore opportunities for the receipt of funding in either equity or financing transactions. As we receive these funds, the Board of Directors and Management evaluate the best use of the funding received so as to continue on the path of fast ramp up to production.

 

Management is currently working on closing certain finance commitments that have been made to advance our operations plan immediately. Details will follow in an appropriate 8-K.

 

Results of Operations – Three months Ended September 30, 2013 and 2012

 

The following discussion should be read in conjunction with our unaudited financial statements and the related notes contained in this report for the period ended September 30, 2013. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to those discussed in this interim report.

 

Our operating expenses for the three months ended September 30, 2013 and 2012 are outlined in the table below:

 

		Three Months Ended September 30,
		2013				2012				Change
Depreciation and amortization		$	13,468			$	13,038			$	430
General and administrative		$	33,221			$	57,746			$	(24,525	)
Management salary		$	10,500			$	11,696			$	(1,196	)
Exploration and development		$	16,711			$	20,032			$	(3,321	)
Professional fees		$	24,536			$	83,623			$	(59,087	)

 

Revenue

 

We are an exploration stage entity and have not commenced any revenue producing activities since our inception. We do not anticipate earning revenues until such time as we have entered into commercial production on the Nyinahin or Pampana River concessions.

 

Expenses

 

The decrease in operating expenses for the three months ended September 30, 2013, compared to the same period in fiscal 2012, was mainly due to a decrease in Management salary due to a change in our officers in the third quarter of 2012 at reduced compensation rates and a reduction of Professional fees due to a reduction of additional audit and accounting fees incurred in 2012 in curing our caveat emptor status and making all necessary filings. During the period, our CEO and President and other members of the Company’s exploration team were able to visit operations in Sierra Leone and Ghana and expended funds to further exploration operations.

 

Other Expenses

 

		Three Months Ended September 30,
		2013				2012				Change
Interest expense		$	95,534			$	59,400			$	36,134
Loss on change in fair value of derivatives		$	474			$	–			$	474
Gain on sale of fixed assets		$	(1,142	)		$	–			$	(1,142	)

 

Interest and financing expenses increased by $36,134 primarily relating to the recognition of the discount on debt of the convertible note agreements dated April 2013 and June 2013. Correspondingly, the loss on derivative related to the change in the fair value of the convertible instrument as of the close of the quarter. The Company was able to liquidate a vehicle held in Sierra Leone that was of no worth and primarily would be used to part pieces. This provided short term funding for various tasks within Sierra Leone.

 

 

Results of Operations – Nine months Ended September 30, 2013 and 2012

 

Our operating expenses for the nine months ended September 30, 2013 and 2012 are outlined in the table below:

 

		Nine Months Ended September 30,
		2013				2012				Change
Depreciation and amortization		$	39,316			$	39,114			$	202
General and administrative		$	158,094			$	187,861			$	(29,767	)
Management salary		$	31,500			$	78,696			$	(47,196	)
Exploration and development		$	79,860			$	120,378			$	(40,518	)
Professional fees		$	188,960			$	309,916			$	(120,956	)

 

Expenses

 

The decrease in operating expenses for the six months ended June 30, 2013, compared to the same period in fiscal 2012, was mainly due to a decrease in professional fees due to the reduction of accounting and auditing costs incurred in 2012 to cure the caveat emptor status and exploration which related to decreased funding available to further exploration work at the concessions. Management salary decreased $47,196 due to the change in management during the first quarter of 2013 at reduced compensation rates and having only a single officer.

 

Other Expenses

 

		Nine Months Ended September 30,
		2013				2012				Change
Interest expense		$	214,551			$	186,800			$	27,751
Financing costs		$	4,000			$	160,281			$	(156,281	)
Loss on change in fair value of derivatives		$	474			$	–			$	474
Gain on sale of fixed assets		$	(1,142	)		$	–			$	(1,142	)

 

Interest and financing expenses increased by $27,751 primarily as the result of an increase in the amounts recognized due to the debt discount on the convertible note agreements. Financing costs decreased $156,281 primarily related to the non-recurring incremental cost associated with the modification of the warrant expiration date that occurred in the first quarter of 2012. Correspondingly, the loss on derivative related to the change in the fair value of the convertible instrument as of the close of the quarter. The Company was able to liquidate a vehicle held in Sierra Leone that was of no worth and primarily would be used to part pieces. This provided short term funding for various tasks within Sierra Leone.

 

Equity Compensation

 

We currently do not have any formalized stock option or equity compensation plans or arrangements however; from time to time we settle obligations via the issuance of equity and equity-linked instruments.

 

 

Liquidity and Financial Condition

 

		September 30, 2013				December 31, 2012				Change
Current assets		$	1,344			$	22,699			$	(21,355	)
Current liabilities		$	1,185,155			$	873,884			$	311,271
Working Capital		$	(1,183,811	)		$	(851,185	)		$	(332,626	)

 

Cashflow

		Nine Months Ended September 30,
		2013				2012				Change
Net cash used in operating activities		$	(131,582	)		$	(288,508	)		$	156,926
Net cash provided/(used) in investing activities		$	(6,501	)		$	(2,500	)		$	(4,001	)
Net cash provided/(used) by financing activities		$	63,500			$	205,571			$	(142,071	)
Net increase/(decrease) in cash during period		$	(74,583	)		$	(85,437	)		$	10,854

 

Our total assets at September 30, 2013 were $1,896,929. Our financial statements report a net loss of $715,613 for the nine months ended September 30, 2013 and a net loss of $5,915,734 for the period from January 28, 2003 (date of inception) to September 30, 2013. We had a cash balance of $1,344 as of September 30, 2013.

 

We have suffered recurring losses from operations. The continuation of our company is dependent upon our company attaining and maintaining profitable operations and raising additional capital as needed. In this regard we have raised additional capital through equity offerings and loan transactions.  We have been successful in structuring deals in which expenses are paid for through the issuances of common shares.  In addition, we have raised additional funds and expect to continue to raise additional funds through private placement equity offerings sufficient to fund our current plan of operations.

 

We continue to explore and seek funding opportunities through either equity or loan transactions. As we receive funding, the use of available funding is evaluated by Management and the Board of Directors for its priority of use.

 

Our principal sources of funds have been from sales of our common stock and we expect this to be consistent for at least the next twelve months.

 

During the first nine months, the Company has focused its efforts on maintaining compliance with all applicable filing requirements and further explore funding opportunities to progress completion of the work and start of operations at our properties in Ghana and Sierra Leone. The company has been successful in covering our on-going operational expenses, through the issuance of equity instruments which will allow a larger percentage of incoming capital to be used to expand our exploration activity.

 

Contractual Obligations

 

As a “smaller reporting company”, we are not required to provide tabular disclosure obligations.

 

 

Off-Balance Sheet Arrangements

 

We have no significant 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 are material to stockholders.

 

Critical Accounting Policies

 

The Company has on occasion issued equity and equity linked instruments to non-employees in lieu of cash to various vendors for the receipt of goods and services and, in certain circumstances the settlement of short-term loan arrangements. The applicable GAAP establishes that share-based payment transactions with nonemployees shall be measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable.

 

In these transactions, we issue unregistered and restricted equity instruments along with equity-linked instruments (warrants) that are convertible into unregistered and restricted shares of our common stock.

 

When unregistered common shares and equity-linked instruments convertible into unregistered common shares are issued for the settlement of short-term financing arrangements (that are not initially convertible), the reacquisition price of the extinguished financing arrangement is determined by the value of the debt which is more clearly evident, and no additional inducement expense is recognized.

 

In situations in which we issue unregistered restricted common shares and equity-linked instruments in exchange for goods and services, and the value of the goods and services are not the most reliably measurable, we recognize the fair value of the unregistered restricted equity instruments based on the value of similar instruments issued in private placements in exchange for cash in the most recent transactions (a Level 2 input within the GAAP hierarchy). We have determined this methodology reflects the risk adjusted fair value of our unregistered restricted equity instruments using a commercially reasonable valuation technique.

 

Of major significance during the nine months period ended September 30, 2012 is the extension of all of the warrants for six months. The assumption was made when these warrants were purchased that the Caveat Emptor would be removed shortly. The filings took longer to complete than was expected. The board of directors felt that since the company had not been able to at that point catch up with its government filings, it would be fair and prudent to extend the warrant date. Now that we are current in our filings we have experienced an increase in the exercising of outstanding warrants.

 

In accordance with ASC 718, a modification of the terms of an equity instrument for financial reporting purposes is treated as an exchange of the original award for a new award. We recognized, as financing costs, the excess value of the modified award over the fair value of the original award immediately before its terms were modified, based on the pertinent factors on the modification date, We estimated the excess value by using a Black-Scholes pricing model, and comparison of the unregistered and restricted shares underlying the warrants to those that are currently freely trading.

 

In addition to assuming a volatility rate of approximately 151% (historically derived), we estimated a forfeiture rate of approximately 55% based on prior exercise history and our prior experience with several of the warrant holders. Increases in the volatility rate assumption along with decreases in the forfeiture would result in the recognition of additional excess value.

 

Item 3. Quantitative Disclosures About Market Risks

 

As a "smaller reporting company", we are not required to provide the information required by this Item.

 

 

Item 4. Controls and Procedures

 

Management's Report on Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. 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.

 

As of the end of the quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president(our principal executive officer) and our Chief Financial Officer (principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president (our principal executive officer) and our Chief Financial Officer ( principal accounting officer) concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with US generally accepted accounting principles due to the existence of significant deficiencies constituting material weaknesses.

 

A material weakness is a control deficiency, or combination of control deficiencies, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

 

Changes in Internal Control over Financial Reporting

.

During the period covered by this report there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

 

Item 1A. Risk Factors

 

We have had no material changes in our risk factors as disclosed in our Form 10-K for the year ended December 31, 2012 filed on April 16, 2013.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

The following provides additional information for certain stock transactions that occurred during the months ended September 30, 2013.  For additional details for all stock transaction please see the consolidated statement of changes in stockholders’ equity as reported in the Company’s 10-K for the period ended December 31, 2012 and filed with the Securities Exchange Commission on April 16, 2013.

 

During the quarter ended September 30, 2013, the Company issued 3,333,333 equity units at $0.0015 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share for total cash of $5,000; the Company issued 5,000,000 equity units at $0.001 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.002 per share for total cash of $5,000; the Company issued 10,000,000 equity units at $0.0015 per unit for consulting services with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share equivalently $15,000; the Company issued 67,733,333 equity units at $0.0015 per unit to settle outstanding accounts payable with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share equivalently $101,669; the Company issued 13,333,333 equity units at $0.0015 per unit to settle outstanding related party payables with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.003 per share or $20,000 equivalently; the Company issued 30,000,000 equity units at $0.001 with each unit consisting of one common share of stock and one 12 month share purchase warrant exercisable at $0.002 per share to settle $30,000 in outstanding notes payable. During the third quarter of 2013, the former chairman of the Board of Directors forgave outstanding amounts owed under his compensation due for 2012. The amount forgiven, $28,500, has been recorded as an increase in additional paid-in capital.

 

 

Item 3. Defaults Upon Senior Securities

 

None

 

Item 4. [Removed and Reserved]

 

None.

 

Item 5. Other Information

 

None.

 

Item 6. Exhibits

 

Exhibit Number	Description
(3)	Articles of Incorporation and By-Laws
3.1	Articles of Incorporation (incorporated by reference from our Registration Statement on Form SB-2 filed on February 23, 2004)
3.2	Bylaws (incorporated by reference from our Registration Statement on Form SB-2 filed on February 23, 2004)
3.3	Certificate of Change (incorporated by reference from our Current Report on Form 8-K filed on October 8, 2008)
3.4	Certificate of Amendment (incorporated by reference from our Current Report on Form 8-K filed on August 26, 2010)
(10)	Material Contracts
10.1	Mineral Property Staking and Purchase Agreement dated April 10, 2003 (incorporated by reference from our Registration Statement on Form SB-2/A filed on June 30, 2004)
10.2	Mining Acquisition Agreement dated October 31, 2008 between our company and General Metals Corporation (incorporated by reference from our Current Report on Form 8-K filed on December 10, 2008)
10.3	Amending Agreement to the Mining Acquisition Agreement dated December 5, 2008 between our company and General Metals Corporation. (incorporated by reference from our Current Report on Form 8-K filed on December 10, 2008)
10.4	Membership Purchase Agreement dated October 18, 2010 between our company and Allied Mining and Supply, LLC. (incorporated by reference from our Current Report on Form 8-K filed on February 4, 2011)
(14)	Code of Ethics
14.1	Code of Ethics and Business Conduct (incorporated by reference to our Annual Report on Form 10-K filed on April 20, 2009)
(21)	Subsidiaries of the Registrant
21.1	Allied Mining and Supply, LLC, a Nevada limited liability company Mikite Gold Resources Limited, a Ghanaian company
(31)	Rule 13a-14(a)/15d-14(a) Certifications
31.1*	Certification of the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
(32)	Section 1350 Certifications
32.1*	Certification of the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer filed pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1*	Temporary Hardship Exemption
101	Interactive Data Files
101.INS**	XBRL Instance Document
101.SCH**	XBRL Taxonomy Extension Schema Document
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB**	XBRL Taxonomy Extension Label Linkbase Document
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document

 

	*	Filed herewith
	**	To be furnished by amendment per Temporary Hardship Exemption under Regulation S-T.

 

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.

 

		SUNERGY, INC.
Date:	November 14, 2013	By:	/s/ Garrett Hale
		Name:	Garrett Hale
		Title:	Chief Executive Officer, President, Director
		Title:	Chief Financial Officer (Principal Financial and Accounting Officer)