Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 15, 2019 | |
Document and Entity Information: | ||
Entity Registrant Name | American Resources Corporation | |
Entity Central Index Key | 0001590715 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 23,316,197 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2019 | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false |
CONSOLIDATED BALANCE SHEETS UNA
CONSOLIDATED BALANCE SHEETS UNAUDITED - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS | ||
Cash | $ 7 | $ 2,293,107 |
Accounts Receivable | 624,045 | 1,318,680 |
Inventory | 738,054 | 163,800 |
Prepaid | 483,000 | 147,826 |
Accounts Receivable - Other | 292,608 | 319,548 |
Total Current Assets | 2,137,714 | 4,262,961 |
OTHER ASSETS | ||
Cash - restricted | 471,640 | 411,692 |
Processing and rail facility | 11,630,171 | 11,630,171 |
Underground equipment | 9,438,673 | 8,717,229 |
Surface equipment | 3,101,518 | 3,101,518 |
Mine development | 40,307,068 | 14,907,068 |
Less Accumulated Depreciation | (8,044,966) | (6,691,259) |
Land | 2,407,193 | 907,193 |
Note Receivable | 4,117,139 | 4,117,139 |
Total Other Assets | 63,428,436 | 37,100,751 |
TOTAL ASSETS | 65,566,150 | 41,363,712 |
CURRENT LIABILITIES | ||
Accounts payable | 6,248,566 | 8,139,662 |
Accounts payable - related party | 579,123 | 474,654 |
Accrued interest | 1,312,562 | 1,118,736 |
Funds held for others | 139,864 | 79,662 |
Due to affiliate | 124,000 | 124,000 |
Current portion of long term-debt (net of unamortized discount of $- and $134,296) | 14,934,884 | 14,169,139 |
Current portion of reclamation liability | 2,327,169 | 2,327,169 |
Total Current Liabilities | 25,666,168 | 26,433,022 |
OTHER LIABILITIES | ||
Long-term portion of note payable (net of issuance costs of $425,820 and $428,699) | 9,803,829 | 7,918,872 |
Reclamation liability | 16,532,541 | 16,211,640 |
Total Other Liabilities | 26,336,370 | 24,130,512 |
Total Liabilities | 52,002,538 | 50,563,534 |
STOCKHOLDERS' DEFICIT | ||
Additional paid-in capital | 75,742,084 | 42,913,532 |
Accumulated deficit | (62,180,803) | (52,115,183) |
Total Stockholders' Deficit | 13,563,612 | (9,199,822) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | 65,566,150 | 41,363,712 |
Common Class A [Member] | ||
STOCKHOLDERS' DEFICIT | ||
Common stock, value | 2,331 | 1,776 |
Series A Preferred Stock [Member] | ||
STOCKHOLDERS' DEFICIT | ||
Preferred stock, value | 48 | |
Series C Preferred Stock [Member] | ||
STOCKHOLDERS' DEFICIT | ||
Preferred stock, value | $ 5 |
CONSOLIDATED BALANCE SHEETS U_2
CONSOLIDATED BALANCE SHEETS UNAUDITED (Parenthetical) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Current portion of long term-debt net of unamortized discount | $ 134,296 | |
OTHER LIABILITIES | ||
Long-term portion of note payable net of issuance costs | $ 425,820 | $ 428,699 |
Common Class A [Member] | ||
STOCKHOLDERS' DEFICIT | ||
Common Stock, Par Value | $ .0001 | $ .0001 |
Common Stock, Shares Authorized | 230,000,000 | 230,000,000 |
Common Stock, Shares Issued | 23,316,197 | 17,763,469 |
Common Stock, Shares Outstanding | 23,316,197 | 17,763,469 |
Series A Preferred Stock [Member] | ||
STOCKHOLDERS' DEFICIT | ||
Preferred Stock, Par Value | $ .0001 | $ .0001 |
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 |
Preferred Stock, Shares Issued | 0 | 481,780 |
Preferred Stock, Shares Outstanding | 0 | 481,780 |
Series C Preferred Stock [Member] | ||
STOCKHOLDERS' DEFICIT | ||
Preferred Stock, Par Value | $ .001 | $ .001 |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred Stock, Shares Issued | 0 | 50,000 |
Preferred Stock, Shares Outstanding | 0 | 50,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Consolidated Statements Of Operations Unaudited | ||
Coal Sales | $ 6,994,276 | $ 7,305,860 |
Processing Services Income | 19,516 | |
Total Revenue | 6,994,276 | 7,325,376 |
Cost of Coal Sales and Processing | (6,644,087) | (5,473,428) |
Accretion Expense | (321,701) | (341,581) |
Depreciation | (816,916) | (615,389) |
Amortization of mining rights | (536,791) | |
General and Administrative | (1,372,588) | (476,589) |
Professional Fees | (4,333,896) | (274,603) |
Production Taxes and Royalties | (1,259,586) | (949,793) |
Development Costs | (1,600,117) | (1,687,173) |
Total Operating expenses | (16,885,682) | (9,818,556) |
Net Loss from Operations | (9,891,406) | (2,493,180) |
Other Income and (expense) | ||
Loss on payable settlement | (22,660) | |
Other Income | 266,425 | 128,514 |
Amortization of debt discount and debt issuance costs | (134,296) | |
Interest Income | 41,171 | 41,171 |
Interest expense | (324,854) | (247,154) |
Total Other income (expense) | (174,214) | (77,469) |
Net Loss | (10,065,620) | (2,570,649) |
Less: Series B dividend requirement | (70,157) | |
Less: Net income attributable to Non Controlling Interest | (128,514) | |
Net loss attributable to American Resources Corporation Shareholders | $ (10,065,620) | $ (2,769,320) |
Net loss per common share - basic and diluted | $ (0.48) | $ (2.96) |
Weighted average common shares outstanding- basic and diluted | 20,798,065 | 892,044 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) | Common Stock | Preferred Series A | Preferred Series B | Preferred Series C | Additional Paid-In Capital | Accumulated Deficit Accumulated | Non-Controlling Interest | Total |
Beginning Balance, Shares at Dec. 31, 2017 | 892,044 | 4,817,792 | 850,000 | |||||
Beginning Balance, Amount at Dec. 31, 2017 | $ 89 | $ 482 | $ 850 | $ 1,527,254 | $ (39,091,757) | $ 397,856 | $ (37,165,226) | |
Series B preferred dividend requirement | (70,157) | (70,157) | ||||||
Net loss | (2,699,163) | 128,514 | (2,570,649) | |||||
Ending Balance, Shares at Mar. 31, 2018 | 892,044 | 4,817,792 | 850,000 | |||||
Ending Balance, Amount at Mar. 31, 2018 | $ 89 | $ 482 | $ 850 | 1,527,254 | (41,861,077) | 526,370 | (39,806,032) | |
Beginning Balance, Shares at Dec. 31, 2018 | 17,763,469 | 481,780 | 50,000 | |||||
Beginning Balance, Amount at Dec. 31, 2018 | $ 1,776 | $ 48 | $ 5 | 42,913,532 | (52,115,183) | (9,199,822) | ||
Issuance of common shares for cash, net, Shares | 1,170,200 | |||||||
Issuance of common shares for cash, net, Amount | $ 117 | 4,253,883 | 4,254,000 | |||||
Issuance of common shares for services, Shares | 159,000 | |||||||
Issuance of common shares for services, Amount | $ 16 | 1,672,200 | $ 1,672,200 | |||||
Issuance of common shares for asset acquisition, Shares | 2,000,000 | 2,000,000 | ||||||
Issuance of common shares for asset acquisition, Amount | $ 200 | 24,399,800 | $ 24,400,000 | |||||
Issuance of common shares for conversion of debt and accounts payable, Shares | 4,417 | |||||||
Issuance of common shares for conversion of debt and accounts payable | 49,161 | 49,161 | ||||||
Issuance of warrants to consultants | 2,385,000 | 2,385,000 | ||||||
Stock option expense | 68,693 | 68,693 | ||||||
Issuance of common Shares for warrant Exercise, Shares | 599,427 | |||||||
Issuance of common Shares for warrant Exercise, Amount | $ 60 | (60) | ||||||
Conversion of Series A into common stock, Shares | 1,605,934 | (481,780) | ||||||
Conversion of Series A into common stock, Amount | $ 161 | $ (48) | (113) | |||||
Conversion of Series C into common stock, Shares | 13,750 | (50,000) | ||||||
Conversion of Series C into common stock, Amount | $ 1 | $ (5) | 4 | |||||
Net loss | (10,065,620) | (10,065,620) | ||||||
Ending Balance, Shares at Mar. 31, 2019 | 23,316,197 | |||||||
Ending Balance, Amount at Mar. 31, 2019 | $ 2,331 | $ 75,742,084 | $ (62,180,803) | $ 13,563,612 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS UNAUDITED - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash Flows from Operating activities: | ||
Net loss | $ (10,065,620) | $ (2,570,649) |
Adjustments to reconcile net income (loss) to net cash | ||
Depreciation | 816,916 | 615,389 |
Amortization of mining rights | 536,791 | |
Accretion expense | 321,701 | 341,581 |
Warrant expense | 2,385,000 | |
Issuance of common shares for services | 1,672,200 | |
Stock compensation expense | 68,693 | |
Amortization of issuance costs and debt discount | 134,296 | 37,841 |
Recovery of previously impaired receivable | (50,806) | (50,806) |
Change in current assets and liabilities: | ||
Accounts receivable | 792,381 | (399,047) |
Prepaid expenses and other assets | (335,174) | (443,482) |
Inventory | (574,254) | 297,974 |
Funds held for others | 60,202 | (70,772) |
Accounts payable | (1,804,045) | 1,057,923 |
Account payable related party | 104,467 | |
Accrued interest | 193,826 | 124,763 |
Cash used in operating activities | (5,743,426) | (1,059,285) |
Cash Flows from Investing activities: | ||
Advances made in connection with management agreement | (7,000) | |
Advance repayment in connection with management agreement | 79,219 | |
Cash paid for PPE, net | (721,444) | |
Cash provided by investing activities | (721,444) | 72,219 |
Cash Flows from Financing activities: | ||
Principal payments on long term debt | (1,373,024) | (191,517) |
Proceeds from long term debt | 2,000,000 | 1,000,000 |
Payments on factoring agreement, net | (649,258) | (112,290) |
Proceeds from sale of common stock, net | 4,254,000 | |
Cash provided by financing activities | 4,231,718 | 696,193 |
Increase (decrease) in cash and restricted cash | (2,233,152) | (290,873) |
Cash and restricted cash, beginning of period | 2,704,799 | 385,665 |
Cash and restricted cash, end of period | 471,647 | 94,792 |
Non-cash investing and financing activities | ||
Equipment for notes payable | 481,660 | |
Preferred Series B Dividends | 70,157 | |
Shares issued in asset acquisition | 24,400,000 | |
Assumption of net assets and liabilities for asset acquisitions | 2,500,000 | |
Conversion of trade payable to equity | 49,161 | |
Cashless exercise of options into common shares | 60 | |
Conversion of Preferred Series A Shares to common shares | 161 | |
Conversion of Preferred Series C Shares to common shares | 1 | |
Cash paid for interest | 131,028 | 66,672 |
Cash paid for income tax |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | American Resources Corporation (ARC or the Company) was formed in June 2015 for the purpose of acquiring, rehabilitating and operating various natural resource assets including coal, oil and natural gas. Basis of Presentation and Consolidation: The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Quest Energy Inc, (QEI), Deane Mining, LLC (Deane), Quest Processing LLC (Quest Processing), ERC Mining Indiana Corp (ERC), McCoy Elkhorn Coal LLC (McCoy), Wyoming County Coal LLC (WCC), Knott County Coal LLC (KCC), Empire Kentucky Land, Inc and Colonial Coal Company, Inc. (Empire) All significant intercompany accounts and transactions have been eliminated. On February 12, 2019, ARC Acquisition Corporation (ARCAC) was formed as a wholly owned subsidiary of ARC. On February 12, 2019, ARCAC merged with Empire Kentucky Land, Inc which is the 100% owner of Colonial Coal Company, Inc. ARC Acquisition Corporation was subsequently renamed Empire Kentucky Land, Inc. The accompanying Consolidated Financial Statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). Interim Financial Information Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. In the opinion of management, these interim unaudited Consolidated Financial Statements reflect all normal and recurring adjustments necessary for a fair presentation of the results for the periods presented. Results of operations for the three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or any other period. These financial statements should be read in conjunction with the Company’s 2018 audited financial statements and notes thereto which were filed on form 10-K on April 3, 2019. Going Concern: Convertible Preferred Securities: Derivatives and Hedging Activities We also follow ASC 480-10, Distinguishing Liabilities from Equity Cash Restricted cash: The following table sets forth a reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheet that agrees to the total of those amounts as presented in the consolidated statement of cash flows for the three months ended March 31, 2019 and March 31, 2018: March 31, 2019 March 31, 2018 Cash $ 7 $ 9,006 Restricted Cash 471,640 85,786 Total cash and restricted cash presented in the consolidated statement of cash flows $ 471,647 $ 94,792 Asset Acquisition: On February 12, 2019, through a share exchange, ARC merged with Empire Kentucky Land, Inc, its wholly-owned subsidiary Colonial Coal Company, Inc and purchased assets of Empire Coal Holdings, LLC in exchange for a cash payment of $500,000 which was carried as a seller note until paid on February 21, 2019, a seller note of $2,000,000 payable in the form of a royalty from production off of the property and 2,000,000 common shares of ARC’s stock valued at $24,400,000. The acquired assets have an anticipated life of 25 years. Capitalized mining rights will be amortized based on productive activities over the anticipated life of 25 years. Amortization expense for this asset for the 3 months ended March 31, 2019 and 2018 amounted to $132,900 and $0, respectively. The assets will be measured for impairment when an event occurs that questions the realization of the recorded value. The stock and assets acquired do not represent a business as defined in FASB AS 805-10-20 due to their classification as a single asset. Accordingly, the assets acquired are initially recognized at the consideration paid, which was the liabilities assumed, including direct acquisition costs, of which there were none. The cost is allocated to the group of assets acquired based on their relative fair value. The assets acquired and liabilities assumed of Empire Coal were as follows at the purchase date: Assets Mine Development - Mining Rights $ 25,400,000 Land 1,500,000 Liabilities Seller Note $ 2,500,000 Asset Retirement Obligations (ARO) – Reclamation: Obligations are reflected at the present value of their future cash flows. We reflect accretion of the obligations for the period from the date they incurred through the date they are extinguished. The asset retirement obligation assets are amortized using the units-of-production method over estimated recoverable (proved and probable) reserves. We are using a discount rate of 10%. Federal and State laws require that mines be reclaimed in accordance with specific standards and approved reclamation plans, as outlined in mining permits. Activities include reclamation of pit and support acreage at surface mines, sealing portals at underground mines, and reclamation of refuse areas and slurry ponds. We assess our ARO at least annually and reflect revisions for permit changes, change in our estimated reclamation costs and changes in the estimated timing of such costs. During the period ending March 31, 2019 and 2018, $- and $- were incurred for loss on settlement on ARO, respectively. The table below reflects the changes to our ARO: Balance at December 31, 2018 $ 18,538,009 Accretion – 3 months March 31, 2019 321,701 Reclamation work – 3 months March 31, 2019 - Balance at March 31, 2019 $ 18,859,710 Allowance For Doubtful Accounts: Allowance for trade receivables as of March 31, 2019 and December 31, 2018 amounted to $0, for both periods. Allowance for other accounts receivables as of March 31, 2019 and December 31, 2018 amounted to $0 and $0, respectively. Trade and loan receivables are carried at amortized cost, net of allowance for losses. Amortized cost approximated book value as of March 31, 2019 and December 31, 2018. Reclassifications: |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 2 - PROPERTY AND EQUIPMENT | At March 31, 2019 and December 31, 2018, property and equipment were comprised of the following: March 31, 2019 December 31, 2018 Processing and rail facility $ 11,630,171 $ 11,630,171 Underground equipment 9,438,673 8,717,229 Surface equipment 3,101,518 3,101,518 Mine Development 40,307,068 14,907,068 Land 2,407,193 907,193 Less: Accumulated depreciation (8,044,966 ) (6,691,259 ) Total Property and Equipment, Net $ 58,839,657 $ 32,571,920 Depreciation expense amounted to $816,916 and $615,389 for the periods March 31, 2019 and March 31, 2018, respectively. The estimated useful lives are as follows: Processing and Rail Facilities 7-20 years Surface Equipment 7 years Underground Equipment 5 years Mine Development 5-25 years |
NOTES PAYABLE
NOTES PAYABLE | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 3 - NOTES PAYABLE | During the three-month period ended March 31, 2019, principal payments on long term debt totaled $1,373,024. During the three-month period ended March 31, 2019, increases to long term debt totaled $4,500,000, primarily from cash received in the form of $2,000,000 from the ARC development loan and $2,500,000 from seller financing for the acquisition of Empire. The ARC development loan carries annual interest at 5%, is due on April 1, 2020 and is secured by all company assets. The acquisition loan totaling $2,500,000 is due with $500,000 upfront and $2,000,000 due through a $1 per ton royalty off the coal sold from the acquired property and is secured by the underlying property. During the three-month period ended March 31, 2018, principal payments on long term debt totaled $191,517. During the three-month period ended March 31, 2018, increases to long term debt totaled $1,481,660. During the three-month period ended March 31, 2019 proceeds from the factoring agreement totaled $10,472,108, and repayments according to the factoring agreement totaled $11,121,366. During the three-month period ended March 31, 2018 proceeds from the factoring agreement totaled $6,714,836 and repayments according to the factoring agreement totaled $6,827,126 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 4 - RELATED PARTY TRANSACTIONS | The Company leases property from a related entity named Land Resources & Royalties (LRR). Until July 1, 2018, LRR was consolidated as a VIE resulting in transaction between the two companies to be eliminated upon consolidation. Upon deconsolidation, amounts paid and owed to LRR have been disclosed discreetly in the consolidated financial statements. For the three-month period ending March 31, 2019, royalty expense incurred with LRR amounted to $104,469 and amounts advanced from LRR amounted to $0 and amounts repaid to LRR amounted to $0. As of March 31, 2019, total amounts owed LRR amounted to $579,123. |
MANAGEMENT AGREEMENT
MANAGEMENT AGREEMENT | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 5 - MANAGEMENT AGREEMENT | On April 13, 2015, ERC entered into a mining and management agreement with an unrelated entity, to operate a coal mining and processing facility in Jasonville, Indiana. Under the management agreement funds advanced for the three-month period ended March 31, 2019 and 2018 are $0 and $7,000, respectively and the amounts repaid totaled $0 and $79,219, respectively. |
EQUITY TRANSACTIONS
EQUITY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 6 - EQUITY TRANSACTIONS | There were no common or other Series A Preferred transactions for the three-month period ending March 31, 2018. Employee stock compensation expense for the three-month period ending March 31, 2019 and 2018 amounted to $68,693 and $0 respectively. On January 16, 2019, an affiliate of the Company converted its remaining 29,051 shares of Series A Preferred into 96,837 common shares. On January 17, 2019, a non-affiliated shareholder partially exercised 300,000 shares of a warrant they held in the Company. The exercise was cashless, and the shareholder received 299,713 shares of common stock as a result of the conversion. On January 25, 2019, the Company extended its consulting agreement with Redstone Communications, LLC for an additional six-month term, and as a result, we issued 105,000 restricted common shares to Redstone Communications LLC and 45,000 restricted common shares to Mr. Marlin Molinaro, another five-year warrant to purchase up to 175,000 common shares of our Company at an exercise price of $1.50 per share and issued to Mr. Marlin Molinaro another five-year warrant option to purchase up to 75,000 common shares of our Company at an exercise price of $1.50 per share as compensation for the second six months of an agreement. Should Redstone Communications, LLC and Mr. Molinaro. If the warrants received under the second six months of engagement, the Company will receive up to $262,500 and $112,500, respectively. The common shares were valued at $10.50 on January 25, 2019 and resulted in an expense of $1,575,000 which was recorded in full on January 25, 2019. The corresponding expense of the issued warrants was recorded in full in the amount of $$2,385,000. On January 27, 2019, the Company issued 1,000 shares of common shares to an unrelated party for the consideration of $5,000 cash to the Company. On January 28, 2019, the Company issued a total of 400 shares of common shares to two unrelated parties for the total consideration of $2,000 cash to the Company. On January 30, 2019, the Company entered into an Investor Relations Agreement with American Capital Ventures, Inc. (“American Capital”) whereby American Capital will provide, among other services, assistance to the Company in planning, reviewing and creating corporate communications, press releases, and presentations and consulting and liaison services to the Company relating to the conception and implementation of its corporate and business development plan. The term of the agreement is six months and American Capital was immediately issued 9,000 shares of common shares as compensation under the agreement. The common shares were valued at $10.80 on January 30, 2019 and resulted in an expense of $97,200 which was recorded in full on January 30, 2019. On January 31, 2019, the Company issued a total of 3,917 shares of common shares, priced at $6 per share, to an unrelated party for the settlement of trade payables in the total amount of $23,502. If at the time of potential sale of the shares, the listed price per share is below $6, the Company is required to purchase the shares back at $6 per share which results in a contingent liability of $23,502. The common shares were valued at $11.00 on January 31, 2019 and resulted in a loss on settlement of $19,585. On February 1, 2019, the Company issued a total of 1,000 shares of common shares to two unrelated parties for the total consideration of $5,000 cash to the Company. On February 6, 2019, a non-affiliated shareholder partially exercised 300,000 shares of a warrant they held in the Company. The exercise was cashless, and the shareholder received 299,714 shares of common stock as a result of the conversion. On February 4 through February 8, 2019, the Company issued a total of 17,800 shares of common shares to sixteen unrelated parties for the total consideration of $89,000 cash to the Company. On February 10, 2019, $3,000 worth of trade payables were settled with 500 common shares of the company. The common shares were valued at $12.15 on February 10, 2019 and resulted in a loss on settlement of $3,075. On February 12, 2019, the Company executed a contract with an unrelated party for the acquisition of stock and assets of entities with non-operating assets consisting of surface and mineral ownership and other related agreements. Consideration is in the form of 2,000,000 common shares, priced at the closing market price of $12.20 per share of common share, as well as $500,000 cash and a promissory note totaling $2,000,000 with a maturity of less than 1 year. The note is secured by a land contract on the acquired property. On February 14, 2019, 452,729 Series A preferred shares were converted into 1,509,097 common shares of the company in a cashless conversion under the terms of the agreement. This resulted in no more Series A Preferred stock being outstanding as of this date. On February 20, 2019, the Company issued 1,000,000 shares of Class A Common Stock at a price of $4 per share in conjunction with its effective S-1/A Registration Statement. Net proceeds to the Company amounted to $3,695,000. As part of the underwriter agreement, 70,000 warrants to purchase Class A Common Stock were issued to the underwriter. These warrants expire on February 15, 2021 and carry an exercise price of $4.40 per share. The warrants had a value of $123,000 was recorded as an increase and decrease in additional paid in capital. Offering costs totaled $447,000, which has been recorded as a reduction of equity. On February 21, 2019, 50,000 Series C Preferred shares were converted into 13,750 shares of Class A Common Stock in a cashless conversion under the terms of the agreement. This resulted in no more Series C Preferred stock being outstanding as of this date. On March 7, 2019, the Company issued an additional 150,000 shares of Class A Common Stock at a price of $4 per share as the over-allotment from the effective S-1/A Registration Statement. The net proceeds to the company amounted to $558,000. As part of the underwriter agreement, 10,500 warrants to purchase Class A Common Stock were issued to the underwriter. These warrants expire on February 15, 2021 and carry an exercise price of $4.40 per share. The warrants had a value of $23,100 was recorded as an increase and decrease in additional paid in capital. March 31, 2019 March 31, 2018 Expected Dividend Yield 0 % 0 % Expected volatility 87.97-109 % 13.73 % Risk-free rate 2.40-2.33 % 1.47-1.62 % Expected life of warrants 1.62-6.20 years 2-3 years Company Warrants: Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Warrants Price Life in Years Value Exercisable - December 31, 2017 5,364,230 $ 2.638 2.8354 $ 138,069 Granted - - - - Forfeited or Expired - - - - Exercised - - - - Outstanding - March 31, 2018 5,364,230 $ 2.638 2.835 $ 138,069 Exercisable (Vested) - March 31, 2018 5,364,230 $ 2.638 2.835 $ 138,069 Exercisable (Vested) – December 31, 2018 5,545,227 $ 2.745 1.704 $ 42,063,228 Granted 330,500 $ 2.206 4.106 $ 1,026,255 Forfeited or Expired - - - - Exercised 600,000 $ 0.010 1.688 $ 4,869,250 Outstanding - March 31, 2019 5,275,727 $ 2.867 1.620 $ 13,945,162 Exercisable (Vested) - March 31, 2019 5,275,727 $ 2.867 1.620 $ 13,945,162 Company Options: Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Options Price Life in Years Value Outstanding - December 31, 2017 - - - - Granted - - - - Forfeited or Expired - - - - Exercised - - - - Outstanding – March 31, 2018 - - - - Exercisable (Vested) - March 31, 2018 - - - - Outstanding – December 31, 2018 681,830 $ 1.413 6.447 $ 405,000 Exercisable (Vested) – December 31, 2018 70,000 $ 4.214 4.247 $ 405,000 Granted - - - - Forfeited or Expired - - - - Exercised - - - - Outstanding - March 31, 2019 681,830 $ 1.330 6.200 $ 80,998 Exercisable (Vested) - March 31, 2019 70,000 $ 4.214 4.000 $ 80,998 Total preferred dividend requirement for the three month period ending March 31, 2019 and 2018 amounted to $0 and $70,157, respectively. |
CORRECTION OF PRIOR YEAR INFORM
CORRECTION OF PRIOR YEAR INFORMATION | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 7 - CORRECTION OF PRIOR YEAR INFORMATION | During the audit of the Company’s consolidated financial statements for the year ended December 31, 2018, the Company identified an error in the formula used to calculate the initial asset retirement obligation of Deane, McCoy and KCC. The formulaic error initially resulted in the overstated long-term assets and long term liabilities for the year ended December 31, 2015, 2016 and 2017. During the year ended December 31, 2016 and 2017, accretion and depreciation expenses were overstated causing an understatement of retained earnings. This resulted in an adjustment to the previously reported amounts in the financial statements of the Company for the three-month period ended March 31, 2018. In accordance with the SEC’s Staff Accounting Bulletin Nos. 99 and 108 (SAB 99 and SAB 108), the Company evaluated this error and, based on an analysis of quantitative and qualitative factors, determined that the error was immaterial to the prior reporting periods affected. However, if the adjustments to correct the cumulative effect of the above error had been recorded in the three months ended March 31, 2018, the Company believes the impact would have been significant and would impact comparisons to prior periods. Therefore, as permitted by SAB 108, the Company corrected, in the current filing, previously reported results of the Company as of March 31, 2018. The following table presents the impact of the correction in the financial statements as of March, 31, 2018: Balance Sheet As of March 31, 2018 As Previously Reported Adjustment As Adjusted Assets Total Current Assets $ 3,068,478 $ - $ 3,068,478 Cash - restricted 85,786 - 85,786 Processing and Rail Facility 2,914,422 (279,647 ) 2,634,775 Underground Equipment 8,887,045 (1,633,897 ) 7,253,148 Surface Equipment 4,439,263 (1,126,208 ) 3,313,055 Less Accumulated Depreciation (5,300,140 ) 933,850 (4,366,290 ) Land 178,683 - 178,683 Accounts Receivable - Other 111,003 - 111,003 Note Receivable 4,117,139 - 4,117,139 Total Assets $ 18,501,679 $ (2,105,902 ) $ 16,395,777 Liabilities and Shareholders' deficit Total Current Liabilities $ 37,459,392 $ - $ 37,459,392 Long-term portion of note payables 5,782,253 - 5,782,253 Reclamation liability $ 17,964,267 (5,004,103 ) 12,960,164 Total Liabilities $ 61,205,912 (5,004,103 ) $ 56,201,809 Class A Common stock 89 - 89 Series A Preferred stock 482 - 482 Series B Preferred stock 850 - 850 APIC 1,527,254 - 1,527,254 Accumulated Deficit (44,759,278 ) 2,898,201 (41,861,077 ) Total American Resources Corporation Shareholders’ Equity (43,230,603 ) 2,898,201 (40,332,402 ) Non Controlling Interest 526,370 - 526,370 Total Liabilities and Shareholders’ Deficit 18,501,679 $ (2,105,902 ) 16,395,777 Income Statement As of March 31, 2018 As Previously Reported Adjustment As Adjusted Revenue Total Revenue $ 7,325,376 $ - $ 7,325,376 Cost of Coal Sales and Processing (5,473,428 ) - (5,473,428 ) Accretion Expense (447,762 ) 106,181 (341,581 ) Depreciation (479,571 ) (135,818 ) (615,389 ) General and Administrative (476,589 ) - (476,589 ) Professional Fees (274,603 ) - (274,603 ) Production Taxes and Royalties (949,793 ) - (949,793 ) Development Costs (1,687,173 ) - (1,687,173 ) Net Loss from Operations $ (2,463,543 ) $ (29,637 ) $ (2,493,180 ) Other Expense, net (77,469 ) - (77,469 ) Net Loss $ (2,541,012 ) $ (29,637 ) $ (2,570,649 ) Less: Preferred dividend requirement (70,157 ) - (70,157 ) Less: Net income attributable to Non Controlling Interest (128,514 ) - (128,514 ) Net loss attributable to American Resources Corporation Shareholders $ (2,739,683 ) $ (29,637 ) $ (2,769,320 ) Statement of Cash Flow As of March 31, 2018 As Previously Reported Adjustment As Adjusted Cash Flows from Operating activities: Net loss $ (2,541,012 ) $ (29,637 ) $ (2,570,649 ) Adjustments to reconcile net loss to net cash Depreciation 479,571 135,818 615,389 Accretion expense 447,762 (106,181 ) 341,581 Amortization of debt discount and issuance costs 37,841 - 37,841 Recovery of advances receivable (50,806 ) - (50,806 ) $ (1,626,644 ) $ - $ (1,626,644 ) Change in current assets and liabilities 567,359 - 567,359 Cash used in operating activities $ (1,059,285 ) - $ (1,059,285 ) Cash provided by investing activities 72,219 - 72,219 Cash provided by financing activities 696,193 - 696,193 Decrease in cash and restricted cash (290,873 ) - (290,873 ) Cash and restricted cash, beginning of year 385,665 - 385,665 Cash and restricted cash, end of year $ 94,792 $ - $ 94,792 |
CONTINGENCIES
CONTINGENCIES | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 8 - CONTINGENCIES | In the course of normal operations, the Company is involved in various claims and litigation that management intends to defend. The range of loss, if any, from potential claims cannot be reasonably estimated. However, management believes the ultimate resolution of matters will not have a material adverse impact on the Company’s business or financial position. In the course of normal operations, the Company is involved in various claims and litigation that management intends to defend. The range of loss, if any, from potential claims cannot be reasonably estimated. However, management believes the ultimate resolution of matters will not have a material adverse impact on the Company’s business or financial position. On August 21, 2018, Deane and an unrelated vendor entered into a settlement agreement for past payables. Pursuant to the settlement agreement, Deane will pay the full outstanding unpaid balance in accordance with the agreed to schedule, with the full amount being due on January 3, 2019. Deane is currently in default of this agreement. On April 3, 2019 KCC partially settled a case relating to a reclamation issue while the property was under former ownership. The settled amount is $100,000 which will be paid out of a prior insurance policy. The remaining portion of the case is still in pending settlement talks. The company leases various office space some from an entity which was consolidated as a variable interest entity until June 30, 2018 (see note 4). The rental lease for the Company’s principal office space expired in December 31, 2018 and is continuing on a month-to-month basis. The future annual rent is $6,000 through 2021. Rent expense for three-month period ending March 31, 2019 and 2018 amounted to $9,000 and $9,000 each period, respectively. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2019 | |
Notes to Financial Statements | |
NOTE 9 - SUBSEQUENT EVENTS | On April 23, 2019, the Company drew the final $1,500,000 from the customer development loan. On April 30, 2019, McCoy entered into a settlement agreement for some previously leased equipment. The settlement calls for monthly cash payments of $10,000 for a total $160,000. If a monthly payment is missed, the missed balance will accrue interest at 6%. In addition, under the settlement agreement, the Company is to issue 50,000 common shares. For a six-month period, post issuance, the Company has the option to repurchase the previously issued shares for $100,000. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Summary Of Significant Accounting Policies | |
Basis of Presentation and Consolidation | The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries Quest Energy Inc, (QEI), Deane Mining, LLC (Deane), Quest Processing LLC (Quest Processing), ERC Mining Indiana Corp (ERC), McCoy Elkhorn Coal LLC (McCoy), Wyoming County Coal LLC (WCC), Knott County Coal LLC (KCC), Empire Kentucky Land, Inc and Colonial Coal Company, Inc. (Empire) All significant intercompany accounts and transactions have been eliminated. On February 12, 2019, ARC Acquisition Corporation (ARCAC) was formed as a wholly owned subsidiary of ARC. On February 12, 2019, ARCAC merged with Empire Kentucky Land, Inc which is the 100% owner of Colonial Coal Company, Inc. ARC Acquisition Corporation was subsequently renamed Empire Kentucky Land, Inc. The accompanying Consolidated Financial Statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). |
Interim Financial Information | Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been omitted. In the opinion of management, these interim unaudited Consolidated Financial Statements reflect all normal and recurring adjustments necessary for a fair presentation of the results for the periods presented. Results of operations for the three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or any other period. These financial statements should be read in conjunction with the Company’s 2018 audited financial statements and notes thereto which were filed on form 10-K on April 3, 2019. |
Going Concern | The Company has suffered recurring losses from operations and currently a working capital deficit. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. We plan to generate profits by expanding current coal operations as well as developing new coal operations. However, we will need to raise the funds required to do so through sale of our securities or through loans from third parties. We do not have any commitments or arrangements from any person to provide us with any additional capital. If additional financing is not available when needed, we may need to cease operations. We may not be successful in raising the capital needed to expand or develop operations. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern. The accompanying financial statements have been prepared assuming the Company will continue as a going concern; no adjustments to the financial statements have been made to account for this uncertainty. |
Convertible Preferred Securities | We account for hybrid contracts that feature conversion options in accordance with generally accepted accounting principles in the United States. ASC 815, Derivatives and Hedging Activities We also follow ASC 480-10, Distinguishing Liabilities from Equity Cash |
Restricted cash | As part of the Kentucky New Markets Development Program (See Note 3) an asset management fee reserve was set up in the amount of $116,115. The funds are held to pay annual asset management fees to an unrelated party through 2021. The balance as of March 31, 2019 and December 31, 2018 was $57,992 and $85,786, respectively. The total balance of restricted cash also includes amounts held under the management agreement. See note 5. The following table sets forth a reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheet that agrees to the total of those amounts as presented in the consolidated statement of cash flows for the three months ended March 31, 2019 and March 31, 2018: March 31, 2019 March 31, 2018 Cash $ 7 $ 9,006 Restricted Cash 471,640 85,786 Total cash and restricted cash presented in the consolidated statement of cash flows $ 471,647 $ 94,792 |
Asset Acquisition | On February 12, 2019, through a share exchange, ARC merged with Empire Kentucky Land, Inc, its wholly-owned subsidiary Colonial Coal Company, Inc and purchased assets of Empire Coal Holdings, LLC in exchange for a cash payment of $500,000 which was carried as a seller note until paid on February 21, 2019, a seller note of $2,000,000 payable in the form of a royalty from production off of the property and 2,000,000 common shares of ARC’s stock valued at $24,400,000. The acquired assets have an anticipated life of 25 years. Capitalized mining rights will be amortized based on productive activities over the anticipated life of 25 years. Amortization expense for this asset for the 3 months ended March 31, 2019 and 2018 amounted to $132,900 and $0, respectively. The assets will be measured for impairment when an event occurs that questions the realization of the recorded value. The stock and assets acquired do not represent a business as defined in FASB AS 805-10-20 due to their classification as a single asset. Accordingly, the assets acquired are initially recognized at the consideration paid, which was the liabilities assumed, including direct acquisition costs, of which there were none. The cost is allocated to the group of assets acquired based on their relative fair value. The assets acquired and liabilities assumed of Empire Coal were as follows at the purchase date: Assets Mine Development - Mining Rights $ 25,400,000 Land 1,500,000 Liabilities Seller Note $ 2,500,000 |
Asset Retirement Obligations (ARO) - Reclamation | At the time they are incurred, legal obligations associated with the retirement of long-lived assets are reflected at their estimated fair value, with a corresponding charge to mine development. Obligations are typically incurred when we commence development of underground and surface mines, and include reclamation of support facilities, refuse areas and slurry ponds or through acquisitions. Obligations are reflected at the present value of their future cash flows. We reflect accretion of the obligations for the period from the date they incurred through the date they are extinguished. The asset retirement obligation assets are amortized using the units-of-production method over estimated recoverable (proved and probable) reserves. We are using a discount rate of 10%. Federal and State laws require that mines be reclaimed in accordance with specific standards and approved reclamation plans, as outlined in mining permits. Activities include reclamation of pit and support acreage at surface mines, sealing portals at underground mines, and reclamation of refuse areas and slurry ponds. We assess our ARO at least annually and reflect revisions for permit changes, change in our estimated reclamation costs and changes in the estimated timing of such costs. During the period ending March 31, 2019 and 2018, $- and $- were incurred for loss on settlement on ARO, respectively. The table below reflects the changes to our ARO: Balance at December 31, 2018 $ 18,538,009 Accretion – 3 months March 31, 2019 321,701 Reclamation work – 3 months March 31, 2019 - Balance at March 31, 2019 $ 18,859,710 |
Allowance For Doubtful Accounts | The Company recognizes an allowance for losses on trade and other accounts receivable in an amount equal to the estimated probable losses net of recoveries. The allowance is based on an analysis of historical bad debt experience, current receivables aging and expected future write-offs, as well as an assessment of specific identifiable amounts considered at risk or uncollectible. Allowance for trade receivables as of March 31, 2019 and December 31, 2018 amounted to $0, for both periods. Allowance for other accounts receivables as of March 31, 2019 and December 31, 2018 amounted to $0 and $0, respectively. Trade and loan receivables are carried at amortized cost, net of allowance for losses. Amortized cost approximated book value as of March 31, 2019 and December 31, 2018. |
Reclassifications | Reclassifications have been made to conform with current year presentation. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Summary Of Significant Accounting Policies Tables Abstract | |
Schedule of restricted cash and cash equivalents | March 31, 2019 March 31, 2018 Cash $ 7 $ 9,006 Restricted Cash 471,640 85,786 Total cash and restricted cash presented in the consolidated statement of cash flows $ 471,647 $ 94,792 |
Schedule of assets acquired and liabilities assumed | Assets Mine Development - Mining Rights $ 25,400,000 Land 1,500,000 Liabilities Seller Note $ 2,500,000 |
Schedule of Asset Retirement Obligations | Balance at December 31, 2018 $ 18,538,009 Accretion – 3 months March 31, 2019 321,701 Reclamation work – 3 months March 31, 2019 - Balance at March 31, 2019 $ 18,859,710 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Property And Equipment | |
Property, Plant and Equipment | March 31, 2019 December 31, 2018 Processing and rail facility $ 11,630,171 $ 11,630,171 Underground equipment 9,438,673 8,717,229 Surface equipment 3,101,518 3,101,518 Mine Development 40,307,068 14,907,068 Land 2,407,193 907,193 Less: Accumulated depreciation (8,044,966 ) (6,691,259 ) Total Property and Equipment, Net $ 58,839,657 $ 32,571,920 |
Property, Plant and Equipment, Estimated Useful Lives | Processing and Rail Facilities 7-20 years Surface Equipment 7 years Underground Equipment 5 years Mine Development 5-25 years |
EQUITY TRANSACTIONS (Tables)
EQUITY TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity Transactions | |
Schedule of Stockholders' Equity Note, Warrants | March 31, 2019 March 31, 2018 Expected Dividend Yield 0 % 0 % Expected volatility 87.97-109 % 13.73 % Risk-free rate 2.40-2.33 % 1.47-1.62 % Expected life of warrants 1.62-6.20 years 2-3 years |
Schedule of assumptions used to messure fair value of warrants/rights | Company Warrants: Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Warrants Price Life in Years Value Exercisable - December 31, 2017 5,364,230 $ 2.638 2.8354 $ 138,069 Granted - - - - Forfeited or Expired - - - - Exercised - - - - Outstanding - March 31, 2018 5,364,230 $ 2.638 2.835 $ 138,069 Exercisable (Vested) - March 31, 2018 5,364,230 $ 2.638 2.835 $ 138,069 Exercisable (Vested) – December 31, 2018 5,545,227 $ 2.745 1.704 $ 42,063,228 Granted 330,500 $ 2.206 4.106 $ 1,026,255 Forfeited or Expired - - - - Exercised 600,000 $ 0.010 1.688 $ 4,869,250 Outstanding - March 31, 2019 5,275,727 $ 2.867 1.620 $ 13,945,162 Exercisable (Vested) - March 31, 2019 5,275,727 $ 2.867 1.620 $ 13,945,162 Company Options: Weighted Weighted Average Average Aggregate Number of Exercise Contractual Intrinsic Options Price Life in Years Value Outstanding - December 31, 2017 - - - - Granted - - - - Forfeited or Expired - - - - Exercised - - - - Outstanding – March 31, 2018 - - - - Exercisable (Vested) - March 31, 2018 - - - - Outstanding – December 31, 2018 681,830 $ 1.413 6.447 $ 405,000 Exercisable (Vested) – December 31, 2018 70,000 $ 4.214 4.247 $ 405,000 Granted - - - - Forfeited or Expired - - - - Exercised - - - - Outstanding - March 31, 2019 681,830 $ 1.330 6.200 $ 80,998 Exercisable (Vested) - March 31, 2019 70,000 $ 4.214 4.000 $ 80,998 |
CORRECTION OF PRIOR YEAR INFO_2
CORRECTION OF PRIOR YEAR INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Correction Of Prior Year Information | |
Schedule of correction in the financial statements | Balance Sheet As of March 31, 2018 As Previously Reported Adjustment As Adjusted Assets Total Current Assets $ 3,068,478 $ - $ 3,068,478 Cash - restricted 85,786 - 85,786 Processing and Rail Facility 2,914,422 (279,647 ) 2,634,775 Underground Equipment 8,887,045 (1,633,897 ) 7,253,148 Surface Equipment 4,439,263 (1,126,208 ) 3,313,055 Less Accumulated Depreciation (5,300,140 ) 933,850 (4,366,290 ) Land 178,683 - 178,683 Accounts Receivable - Other 111,003 - 111,003 Note Receivable 4,117,139 - 4,117,139 Total Assets $ 18,501,679 $ (2,105,902 ) $ 16,395,777 Liabilities and Shareholders' deficit Total Current Liabilities $ 37,459,392 $ - $ 37,459,392 Long-term portion of note payables 5,782,253 - 5,782,253 Reclamation liability $ 17,964,267 (5,004,103 ) 12,960,164 Total Liabilities $ 61,205,912 (5,004,103 ) $ 56,201,809 Class A Common stock 89 - 89 Series A Preferred stock 482 - 482 Series B Preferred stock 850 - 850 APIC 1,527,254 - 1,527,254 Accumulated Deficit (44,759,278 ) 2,898,201 (41,861,077 ) Total American Resources Corporation Shareholders’ Equity (43,230,603 ) 2,898,201 (40,332,402 ) Non Controlling Interest 526,370 - 526,370 Total Liabilities and Shareholders’ Deficit 18,501,679 $ (2,105,902 ) 16,395,777 Income Statement As of March 31, 2018 As Previously Reported Adjustment As Adjusted Revenue Total Revenue $ 7,325,376 $ - $ 7,325,376 Cost of Coal Sales and Processing (5,473,428 ) - (5,473,428 ) Accretion Expense (447,762 ) 106,181 (341,581 ) Depreciation (479,571 ) (135,818 ) (615,389 ) General and Administrative (476,589 ) - (476,589 ) Professional Fees (274,603 ) - (274,603 ) Production Taxes and Royalties (949,793 ) - (949,793 ) Development Costs (1,687,173 ) - (1,687,173 ) Net Loss from Operations $ (2,463,543 ) $ (29,637 ) $ (2,493,180 ) Other Expense, net (77,469 ) - (77,469 ) Net Loss $ (2,541,012 ) $ (29,637 ) $ (2,570,649 ) Less: Preferred dividend requirement (70,157 ) - (70,157 ) Less: Net income attributable to Non Controlling Interest (128,514 ) - (128,514 ) Net loss attributable to American Resources Corporation Shareholders $ (2,739,683 ) $ (29,637 ) $ (2,769,320 ) Statement of Cash Flow As of March 31, 2018 As Previously Reported Adjustment As Adjusted Cash Flows from Operating activities: Net loss $ (2,541,012 ) $ (29,637 ) $ (2,570,649 ) Adjustments to reconcile net loss to net cash Depreciation 479,571 135,818 615,389 Accretion expense 447,762 (106,181 ) 341,581 Amortization of debt discount and issuance costs 37,841 - 37,841 Recovery of advances receivable (50,806 ) - (50,806 ) $ (1,626,644 ) $ - $ (1,626,644 ) Change in current assets and liabilities 567,359 - 567,359 Cash used in operating activities $ (1,059,285 ) - $ (1,059,285 ) Cash provided by investing activities 72,219 - 72,219 Cash provided by financing activities 696,193 - 696,193 Decrease in cash and restricted cash (290,873 ) - (290,873 ) Cash and restricted cash, beginning of year 385,665 - 385,665 Cash and restricted cash, end of year $ 94,792 $ - $ 94,792 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Summary Of Significant Accounting Policies Details Abstract | ||||
Cash | $ 7 | $ 2,293,107 | $ 9,006 | |
Restricted Cash | 471,640 | 411,692 | 85,786 | |
Total cash and restricted cash presented in the consolidated statement of cash flows | $ 471,647 | $ 2,704,799 | $ 94,792 | $ 385,665 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - PointRock [Member] | Mar. 31, 2019USD ($) |
Assets | |
Mine Development - Mining Rights | $ 25,400,000 |
Land | 1,500,000 |
Liabilities | |
Seller Note | $ 2,500,000 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Summary Of Significant Accounting Policies Details 2Abstract | ||
Beginning Balance | $ 18,538,009 | |
Accretion | 321,701 | $ 341,581 |
Reclamation work | ||
Ending Balance | $ 18,859,710 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | Feb. 10, 2019 | Jan. 31, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | Feb. 12, 2019 | Dec. 31, 2018 |
Issuance of common shares for asset acquisition, shares | 2,000,000 | |||||
Issuance of common shares for asset acquisition, value | $ 24,400,000 | |||||
Loss on settlement on ARO | $ 3,075 | $ 19,585 | ||||
Amortization expense | 132,900 | 0 | ||||
Cash payment | 7 | 9,006 | $ 2,293,107 | |||
Asset management fee | 116,115 | $ 116,115 | ||||
Annual asset management fees | 57,992 | 85,786 | ||||
Allowance for trade receivables | 0 | 0 | ||||
Allowance for other accounts receivables | $ 0 | $ 0 | ||||
Asset Acquisitions [Member] | ||||||
Acquired assets anticipated life years | 25 years | |||||
Capitalized mining rights amortized life years | 25 years | |||||
Asset Acquisitions [Member] | Colonial Coal Company, Inc [Member] | ||||||
Ownership percentages | 100.00% | |||||
Asset Acquisitions [Member] | Colonial Coal Company, Inc [Member] | Empire Coal Holdings, LLC [Member] | Seller Note One [Member] | ||||||
Seller note payable | $ 2,000,000 | |||||
Cash payment | $ 500,000 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Less: Accumulated depreciation | $ (8,044,966) | $ (6,691,259) |
Total Property and Equipment, Net | 58,839,657 | 32,571,920 |
Underground equipment [Member] | ||
Property and equipment | 9,438,673 | 8,717,229 |
Surface equipment [Member] | ||
Property and equipment | 3,101,518 | 3,101,518 |
Mine Development [Member] | ||
Property and equipment | 40,307,068 | 14,907,068 |
Processing and rail facilities [Member] | ||
Property and equipment | 11,630,171 | 11,630,171 |
Land [Member] | ||
Property and equipment | $ 2,407,193 | $ 907,193 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details 1) | 3 Months Ended |
Mar. 31, 2019 | |
Surface equipment [Member] | |
Estimated useful lives | 7 years |
Underground equipment [Member] | |
Estimated useful lives | 5 years |
Minimum [Member] | Mine Development [Member] | |
Estimated useful lives | 5 years |
Maximum [Member] | Mine Development [Member] | |
Estimated useful lives | 25 years |
Processing and rail facilities [Member] | Minimum [Member] | |
Estimated useful lives | 7 years |
Processing and rail facilities [Member] | Maximum [Member] | |
Estimated useful lives | 20 years |
PROPERTY AND EQUIPMENT (Detai_3
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Property And Equipment Details Narrative Abstract | ||
Depreciation expense | $ 816,916 | $ 615,389 |
NOTES PAYABLE (Details Narrativ
NOTES PAYABLE (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Principal payments on long term debt | $ 1,373,024 | $ 191,517 |
Proceeds from long term debt | 2,000,000 | $ 1,000,000 |
Proceeds from the factoring agreement | $ 10,472,108 | |
Description of acquisition | The acquisition loan totaling $2,500,000 is due with $500,000 upfront and $2,000,000 due through a $1 per ton royalty off the coal sold from the acquired property and is secured by the underlying property. | |
Payments on factoring agreement, net | $ 11,121,366 | |
Seller Financing [Member] | ||
Proceeds from long term debt | 2,500,000 | |
ARC Development Loan [Member] | ||
Proceeds from long term debt | $ 2,000,000 | |
Annual interest rate | 5.00% | |
Due date | Apr. 1, 2020 | |
Notes Payable [Member] | ||
Principal payments on long term debt | $ 191,517 | |
Proceeds from the factoring agreement | 6,714,836 | |
Increases to long term debt totaled | 1,481,660 | |
Payments on factoring agreement, net | $ 6,827,126 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Royalty expense | $ (1,259,586) | $ (949,793) |
LRR [Member] | ||
Royalty expense | 104,469 | |
Proceeds from related party | 0 | |
Repayment of related party | 0 | |
Due to related party | $ 579,123 |
MANAGEMENT AGREEMENT (Details N
MANAGEMENT AGREEMENT (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Advances made in connection with management agreement | $ (7,000) | |
Advance repayment in connection with management agreement | 79,219 | |
ERC [Member] | ||
Advances made in connection with management agreement | 7,000 | |
Advance repayment in connection with management agreement | $ 79,219 |
EQUITY TRANSACTIONS (Details)
EQUITY TRANSACTIONS (Details) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Expected Dividend Yeild | 0.00% | 0.00% |
Expected volatility | 13.73% | |
Minimum [Member] | ||
Expected volatility | 87.97% | |
Risk-free rate | 2.40% | 1.47% |
Expected life of warrants | 1 year 7 months 13 days | 2 years |
Maximum [Member] | ||
Expected volatility | 109.00% | |
Risk-free rate | 2.33% | 1.62% |
Expected life of warrants | 6 years 2 months 12 days | 3 years |
EQUITY TRANSACTIONS (Details 1)
EQUITY TRANSACTIONS (Details 1) - Warrant [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Beginning Outstanding | 5,545,227 | 5,364,230 |
Beginning Exercisable | 5,545,227 | 5,364,230 |
Granted | 330,500 | |
Forfeited or Expired | ||
Exercised | 600,000 | |
Ending Outstanding | 5,275,727 | 5,364,230 |
Ending Exercisable (Vested) | 5,275,727 | 5,364,230 |
Weighted Average Exercise Price | ||
Beginning Outstanding | $ 2.745 | $ 2.638 |
Beginning Exercisable | 2.745 | 2.638 |
Granted | 2.206 | |
Forfeited or Expired | ||
Exercised | 0.010 | |
Ending Outstanding | 2.867 | 2.638 |
Ending Exercisable (Vested) | $ 2.867 | $ 2.638 |
Weighted Average Contractual Life in Years | ||
Weighted average remaining contractual terms of share exercisable | 1 year 8 months 12 days | 2 years 9 months 18 days |
Weighted average remaining contractual terms of share granted | 4 years 1 month 6 days | |
Weighted average remaining contractual terms of Exercised | 1 year 8 months 12 days | |
Weighted average remaining contractual terms of share Outstanding | 1 year 7 months 6 days | 2 years 9 months 18 days |
Weighted average remaining contractual terms of share exercisable | 1 year 7 months 6 days | 2 years 9 months 18 days |
Aggregate Intrinsic Value | ||
Beginning Outstanding | $ 42,063,228 | $ 138,069 |
Beginning Exercisable | 42,063,228 | 138,069 |
Granted | 1,026,255 | |
Forfeited or Expired | ||
Exercised | 4,869,250 | |
Ending Outstanding | 13,945,162 | 138,069 |
Ending Exercisable (Vested) | $ 13,945,162 | $ 138,069 |
EQUITY TRANSACTIONS (Details 2)
EQUITY TRANSACTIONS (Details 2) - Stock options [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Beginning Outstanding | 681,830 | |
Beginning Exercisable | 681,830 | |
Granted | ||
Forfeited or Expired | ||
Exercised | ||
Ending Outstanding | 681,830 | |
Ending Exercisable (Vested) | 70,000 | |
Weighted Average Exercise Price | ||
Beginning Outstanding | $ 1.413 | |
Beginning Exercisable | 1.413 | |
Granted | ||
Forfeited or Expired | ||
Exercised | ||
Ending Outstanding | 1.330 | |
Ending Exercisable (Vested) | $ 4.214 | |
Weighted Average Contractual Life in Years | ||
Weighted average remaining contractual terms of share Outstanding beginning | 6 years 4 months 24 days | |
Weighted average remaining contractual terms of share exercisable beginning | 4 years 2 months 12 days | |
Weighted average remaining contractual terms of share Outstanding | 6 years 2 months 12 days | |
Weighted average remaining contractual terms of share exercisable | 4 years | |
Aggregate Intrinsic Value | ||
Beginning Outstanding | $ 405,000 | |
Beginning Exercisable | 405,000 | |
Granted | ||
Forfeited or Expired | ||
Exercised | ||
Ending Outstanding | 80,998 | |
Ending Exercisable (Vested) | $ 80,998 |
EQUITY TRANSACTIONS (Details Na
EQUITY TRANSACTIONS (Details Narrative) - USD ($) | Mar. 07, 2019 | Feb. 12, 2019 | Feb. 10, 2019 | Feb. 06, 2019 | Feb. 21, 2019 | Feb. 20, 2019 | Feb. 14, 2019 | Jan. 31, 2019 | Jan. 30, 2019 | Jan. 28, 2019 | Jan. 27, 2019 | Jan. 25, 2019 | Jan. 17, 2019 | Jan. 16, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 |
Stock issued during period, shares | 500 | ||||||||||||||||
Common stock, par value | $ 12.15 | $ 12.15 | |||||||||||||||
Issuance of warrants to consultants | $ 2,385,000 | ||||||||||||||||
Expense by common stock shares | $ 1,575,000 | ||||||||||||||||
Trade payables | $ 3,000 | ||||||||||||||||
Loss on settlement | $ 3,075 | $ 19,585 | |||||||||||||||
Total preferred dividend amount | $ 0 | $ 70,157 | |||||||||||||||
Unrelated party [Member] | |||||||||||||||||
Common stock, par value | $ 10.80 | ||||||||||||||||
Common shares, price per share | $ 6 | ||||||||||||||||
Common stock, shares issued | 3,917 | ||||||||||||||||
Common stock shares issued for cash | 400 | 1,000 | |||||||||||||||
Common stock value issued for cash | $ 2,000 | $ 5,000 | |||||||||||||||
Expense by common stock shares | $ 97,200 | ||||||||||||||||
Trade payables | 23,502 | ||||||||||||||||
Contingent liability | $ 23,502 | ||||||||||||||||
Common shares, price per share | If at the time of potential sale of the shares, the listed price per share is below $6, the Company is required to purchase the shares back at $6 per share | ||||||||||||||||
Unrelated party [Member] | Subsequent Event [Member] | February 1, 2019 [Member] | |||||||||||||||||
Common stock shares issued for cash | 1,000 | ||||||||||||||||
Common stock value issued for cash | $ 5,000 | ||||||||||||||||
Warrant [Member] | Non-affiliated shareholder [Member] | |||||||||||||||||
Convertible securities, shares converted | 300,000 | 300,000 | |||||||||||||||
Common stock issued upon conversion | 299,714 | 299,713 | |||||||||||||||
Unrelated Parties [Member] | |||||||||||||||||
Cash consideration | $ 500,000 | ||||||||||||||||
Issuance of common shares for asset acquisition | 2,000,000 | ||||||||||||||||
Closing market price per share | $ 12.20 | ||||||||||||||||
Promissory note | $ 2,000,000 | ||||||||||||||||
Maturity date description | less than 1 year | ||||||||||||||||
Unrelated Parties [Member] | On February 4 through February 8, 2019 [Member] | |||||||||||||||||
Stock issued during period, shares | 17,800 | ||||||||||||||||
Cash consideration | $ 89,000 | ||||||||||||||||
Consulting agreement [Member] | Redstone Communications LLC [Member] | Stock options [Member] | |||||||||||||||||
Proceeds receivable from warrants or rights if exercised | $ 262,500 | ||||||||||||||||
Common stock shares reserved for future issuance | 175,000 | ||||||||||||||||
Consulting agreement [Member] | Mr. Marlin Molinaro [Member] | Stock options [Member] | |||||||||||||||||
Common stock, par value | $ 10.50 | ||||||||||||||||
Proceeds receivable from warrants or rights if exercised | $ 112,500 | ||||||||||||||||
Common stock shares reserved for future issuance | 75,000 | ||||||||||||||||
Consulting agreement [Member] | Restricted Stock Units (RSUs) [Member] | Redstone Communications LLC [Member] | |||||||||||||||||
Stock issued during period, shares | 105,000 | ||||||||||||||||
Exercise price | $ 1.50 | ||||||||||||||||
Maturity period | 5 years | ||||||||||||||||
Description for the extension of agreement | On January 25, 2019, the Company extended its consulting agreement with Redstone Communications, LLC for an additional six-month term | ||||||||||||||||
Consulting agreement [Member] | Restricted Stock Units (RSUs) [Member] | Mr. Marlin Molinaro [Member] | |||||||||||||||||
Stock issued during period, shares | 45,000 | ||||||||||||||||
Exercise price | $ 1.50 | ||||||||||||||||
Maturity period | 5 years | ||||||||||||||||
Investor relations agreement [Member] | American Capital Ventures, Inc. [Member] | |||||||||||||||||
Stock issued during period, shares | 9,000 | ||||||||||||||||
Term of agreement | 6 months | ||||||||||||||||
Common Class A [Member] | |||||||||||||||||
Common stock, par value | $ 4 | $ 4 | $ .0001 | $ .0001 | |||||||||||||
Common stock, shares issued | 150,000 | 1,000,000 | 23,316,197 | 17,763,469 | |||||||||||||
Class of warrants or rights issued | 10,500 | 70,000 | |||||||||||||||
Class of warrants or rights issued, value | $ 23,100 | $ 123,000 | |||||||||||||||
Exercise price | $ 4.40 | $ 4.40 | |||||||||||||||
Net proceeds | $ 558,000 | $ 3,695,000 | |||||||||||||||
Warrants expiration date | Feb. 15, 2021 | Feb. 15, 2021 | |||||||||||||||
Offering costs | $ 447,000 | ||||||||||||||||
Series C Preferred Stock [Member] | |||||||||||||||||
Preferred Stock, Shares Issued | 50,000 | 0 | 50,000 | ||||||||||||||
Conversion of Series C into common stock | 13,750 | ||||||||||||||||
Series A Preferred Stock [Member] | |||||||||||||||||
Stock issued during period, shares | 1,509,097 | ||||||||||||||||
Preferred Stock, Shares Issued | 452,729 | 0 | 481,780 | ||||||||||||||
Series A Preferred Stock [Member] | An affiliate [Member] | |||||||||||||||||
Convertible securities, shares converted | 29,051 | ||||||||||||||||
Common stock issued upon conversion | 96,837 |
CORRECTION OF PRIOR YEAR INFO_3
CORRECTION OF PRIOR YEAR INFORMATION (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Assets | ||||
Total Current Assets | $ 2,137,714 | $ 4,262,961 | ||
Processing and Rail Facility | 11,630,171 | 11,630,171 | ||
Underground Equipment | 9,438,673 | 8,717,229 | ||
Surface Equipment | 3,101,518 | 3,101,518 | ||
Land | 2,407,193 | 907,193 | ||
Note Receivable | 4,117,139 | 4,117,139 | ||
Total Assets | 65,566,150 | 41,363,712 | ||
Liabilities and Shareholders' deficit | ||||
Total Current Liabilities | 25,666,168 | 26,433,022 | ||
Long-term portion of note payables | 9,803,829 | 7,918,872 | ||
Total Liabilities | 52,002,538 | 50,563,534 | ||
APIC | 75,742,084 | 42,913,532 | ||
Accumulated Deficit | (62,180,803) | (52,115,183) | ||
Total American Resources Corporation Shareholders' Equity | 13,563,612 | (9,199,822) | $ (39,806,032) | $ (37,165,226) |
Total Liabilities and Shareholders' Deficit | 65,566,150 | 41,363,712 | ||
Common Class A [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Common stock | 2,331 | 1,776 | ||
Series A Preferred Stock [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Preferred stock | $ 48 | |||
Adjustment [Member] | ||||
Assets | ||||
Total Current Assets | ||||
Cash - restricted | ||||
Processing and Rail Facility | (279,647) | |||
Underground Equipment | (1,633,897) | |||
Surface Equipment | (1,126,208) | |||
Mining Rights | 933,850 | |||
Less Accumulated Depreciation | ||||
Land | ||||
Accounts Receivable - Other | ||||
Note Receivable | (2,105,902) | |||
Liabilities and Shareholders' deficit | ||||
Total Current Liabilities | ||||
Long-term portion of note payables | ||||
Reclamation liability | (5,004,103) | |||
Total Liabilities | (5,004,103) | |||
APIC | ||||
Accumulated Deficit | 2,898,201 | |||
Total American Resources Corporation Shareholders' Equity | 2,898,201 | |||
Non Controlling Interest | ||||
Total Liabilities and Shareholders' Deficit | (2,105,902) | |||
Adjustment [Member] | Common Class A [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Common stock | ||||
Adjustment [Member] | Series A Preferred Stock [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Preferred stock | ||||
Adjustment [Member] | Series B Preferred Stock [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Preferred stock | ||||
As Previously Reported [Member] | ||||
Assets | ||||
Total Current Assets | 3,068,478 | |||
Cash - restricted | 85,786 | |||
Processing and Rail Facility | 2,914,422 | |||
Underground Equipment | 8,887,045 | |||
Surface Equipment | 4,439,263 | |||
Mining Rights | (5,300,140) | |||
Less Accumulated Depreciation | 178,683 | |||
Land | 111,003 | |||
Accounts Receivable - Other | 4,117,139 | |||
Note Receivable | 18,501,679 | |||
Liabilities and Shareholders' deficit | ||||
Total Current Liabilities | 37,459,392 | |||
Long-term portion of note payables | 5,782,253 | |||
Reclamation liability | 17,964,267 | |||
Total Liabilities | 61,205,912 | |||
APIC | 1,527,254 | |||
Accumulated Deficit | (44,759,278) | |||
Total American Resources Corporation Shareholders' Equity | (43,230,603) | |||
Non Controlling Interest | 526,370 | |||
Total Liabilities and Shareholders' Deficit | 18,501,679 | |||
As Previously Reported [Member] | Common Class A [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Common stock | 89 | |||
As Previously Reported [Member] | Series A Preferred Stock [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Preferred stock | 482 | |||
As Previously Reported [Member] | Series B Preferred Stock [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Preferred stock | 850 | |||
As Restated [Member] | ||||
Assets | ||||
Total Current Assets | 3,068,478 | |||
Cash - restricted | 85,786 | |||
Processing and Rail Facility | 2,634,775 | |||
Underground Equipment | 7,253,148 | |||
Surface Equipment | 3,313,055 | |||
Mining Rights | (4,366,290) | |||
Less Accumulated Depreciation | 178,683 | |||
Land | 111,003 | |||
Accounts Receivable - Other | 4,117,139 | |||
Note Receivable | 16,395,777 | |||
Liabilities and Shareholders' deficit | ||||
Total Current Liabilities | 37,459,392 | |||
Long-term portion of note payables | 5,782,253 | |||
Reclamation liability | 12,960,164 | |||
Total Liabilities | 56,201,809 | |||
APIC | 1,527,254 | |||
Accumulated Deficit | (41,861,077) | |||
Total American Resources Corporation Shareholders' Equity | (40,332,402) | |||
Non Controlling Interest | 526,370 | |||
Total Liabilities and Shareholders' Deficit | 16,395,777 | |||
As Restated [Member] | Common Class A [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Common stock | 89 | |||
As Restated [Member] | Series A Preferred Stock [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Preferred stock | 482 | |||
As Restated [Member] | Series B Preferred Stock [Member] | ||||
Liabilities and Shareholders' deficit | ||||
Preferred stock | $ 850 |
CORRECTION OF PRIOR YEAR INFO_4
CORRECTION OF PRIOR YEAR INFORMATION (Details 1) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue | ||
Total Revenue | $ 6,994,276 | $ 7,325,376 |
Cost of Coal Sales and Processing | (6,644,087) | (5,473,428) |
Accretion Expense | (321,701) | (341,581) |
Depreciation | (816,916) | (615,389) |
General and Administrative | (1,372,588) | (476,589) |
Professional Fees | (4,333,896) | (274,603) |
Production Taxes and Royalties | (1,259,586) | (949,793) |
Development Costs | (1,600,117) | (1,687,173) |
Net Loss from Operations | (9,891,406) | (2,493,180) |
Other Expense, net | 266,425 | 128,514 |
Net Loss | (10,065,620) | (2,570,649) |
Less: Preferred dividend requirement | 0 | 70,157 |
Less: Net income attributable to Non Controlling Interest | (128,514) | |
Net loss attributable to American Resources Corporation Shareholders | $ (10,065,620) | (2,769,320) |
Adjustment [Member] | ||
Revenue | ||
Total Revenue | ||
Cost of Coal Sales and Processing | ||
Accretion Expense | 106,181 | |
Depreciation | (135,818) | |
General and Administrative | ||
Professional Fees | ||
Production Taxes and Royalties | ||
Development Costs | ||
Net Loss from Operations | (29,637) | |
Other Expense, net | ||
Net Loss | (29,637) | |
Less: Preferred dividend requirement | ||
Less: Net income attributable to Non Controlling Interest | ||
Net loss attributable to American Resources Corporation Shareholders | (29,637) | |
As Previously Reported [Member] | ||
Revenue | ||
Total Revenue | 7,325,376 | |
Cost of Coal Sales and Processing | (5,473,428) | |
Accretion Expense | (447,762) | |
Depreciation | (479,571) | |
General and Administrative | (476,589) | |
Professional Fees | (274,603) | |
Production Taxes and Royalties | (949,793) | |
Development Costs | (1,687,173) | |
Net Loss from Operations | (2,463,543) | |
Other Expense, net | (77,469) | |
Net Loss | (2,541,012) | |
Less: Preferred dividend requirement | (70,157) | |
Less: Net income attributable to Non Controlling Interest | (128,514) | |
Net loss attributable to American Resources Corporation Shareholders | (2,739,683) | |
As Restated [Member] | ||
Revenue | ||
Total Revenue | 7,325,376 | |
Cost of Coal Sales and Processing | (5,473,428) | |
Accretion Expense | (341,581) | |
Depreciation | (615,389) | |
General and Administrative | (476,589) | |
Professional Fees | (274,603) | |
Production Taxes and Royalties | (949,793) | |
Development Costs | (1,687,173) | |
Net Loss from Operations | (2,493,180) | |
Other Expense, net | (77,469) | |
Net Loss | (2,570,649) | |
Less: Preferred dividend requirement | (70,157) | |
Less: Net income attributable to Non Controlling Interest | (128,514) | |
Net loss attributable to American Resources Corporation Shareholders | $ (2,769,320) |
CORRECTION OF PRIOR YEAR INFO_5
CORRECTION OF PRIOR YEAR INFORMATION (Details 2) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash Flows from Operating activities: | ||
Depreciation | $ 816,916 | $ 615,389 |
Accretion expense | 321,701 | 341,581 |
Amortization of debt discount and issuance costs | 134,296 | 37,841 |
Cash used in operating activities | (5,743,426) | (1,059,285) |
Cash provided by investing activities | (721,444) | 72,219 |
Cash provided by financing activities | 4,231,718 | 696,193 |
Decrease in cash and restricted cash | (2,233,152) | (290,873) |
Cash and restricted cash, beginning of period | 2,704,799 | 385,665 |
Cash and restricted cash, end of period | $ 471,647 | 94,792 |
Adjustment [Member] | ||
Cash Flows from Operating activities: | ||
Net loss | (29,637) | |
Depreciation | 135,818 | |
Accretion expense | (106,181) | |
Amortization of debt discount and issuance costs | ||
Recovery of advances receivable | ||
Total | ||
Change in current assets and liabilities | ||
Cash used in operating activities | ||
Cash provided by investing activities | ||
Cash provided by financing activities | ||
Decrease in cash and restricted cash | ||
Cash and restricted cash, beginning of period | ||
Cash and restricted cash, end of period | ||
As Previously Reported [Member] | ||
Cash Flows from Operating activities: | ||
Net loss | (2,541,012) | |
Depreciation | 479,571 | |
Accretion expense | 447,762 | |
Amortization of debt discount and issuance costs | 37,841 | |
Recovery of advances receivable | (50,806) | |
Total | (1,626,644) | |
Change in current assets and liabilities | 567,359 | |
Cash used in operating activities | (1,059,285) | |
Cash provided by investing activities | 72,219 | |
Cash provided by financing activities | 696,193 | |
Decrease in cash and restricted cash | (290,873) | |
Cash and restricted cash, beginning of period | 385,665 | |
Cash and restricted cash, end of period | 94,792 | |
As Restated [Member] | ||
Cash Flows from Operating activities: | ||
Net loss | (2,570,649) | |
Depreciation | 615,389 | |
Accretion expense | 341,581 | |
Amortization of debt discount and issuance costs | 37,841 | |
Recovery of advances receivable | (50,806) | |
Total | (1,626,644) | |
Change in current assets and liabilities | 567,359 | |
Cash used in operating activities | (1,059,285) | |
Cash provided by investing activities | 72,219 | |
Cash provided by financing activities | 696,193 | |
Decrease in cash and restricted cash | (290,873) | |
Cash and restricted cash, beginning of period | 385,665 | |
Cash and restricted cash, end of period | $ 94,792 |
CONTINGENCIES (Details Narrativ
CONTINGENCIES (Details Narrative) - USD ($) | Feb. 10, 2019 | Jan. 31, 2019 | Mar. 31, 2019 | Mar. 31, 2018 |
Future annual rent | $ 6,000 | |||
Rent expense | $ 9,000 | $ 9,000 | ||
Annual rent maturity date | through 2021 | |||
Frequency of periodic payment | Month-to-month | |||
Gain on reclamation settlement | $ (3,075) | $ (19,585) | ||
KCC [Member] | ||||
Gain on reclamation settlement | $ 100,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - Subsequent Event [Member] - USD ($) | 1 Months Ended | |
Apr. 30, 2019 | Apr. 23, 2019 | |
Customer development loan | $ 1,500,000 | |
Settlement Agreement [Member] | Option [Member] | ||
Repurchase of common stock | $ 100,000 | |
McCoy [Member] | Settlement Agreement [Member] | ||
Monthly cash payments | 10,000 | |
Total monthly cash payments | $ 160,000 | |
Interest rate | 6.00% | |
Common stock, shares issued | 50,000 |