UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended DECEMBER 31, 2007
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number 0-12809
AMERICAN RESOURCE TECHNOLOGIES, INC.
------------------------------------
(Formerly Golden Chief Resources, Inc.)
(Exact name of small business issuer as specified in its charter)
State of Kansas 48-0846635
--------------- ----------
(State or other jurisdiction of (IRS Employer
incorporation or organization) I. D. Number)
896 N. Mill Street, Suite 203, Lewisville, Texas 75057
(Address of principal executive offices)
(972) 219-8585
(Issuer's telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark whether the registrant Yes [ ] No [X]
is a shell company (as defined in Rule 12b-2
of the Exchange Act).
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
There were 12,229,846 shares of common stock, No Par Value,
outstanding as of December 31, 2007.
Transitional Small Business Disclosure Format (check one); Yes [ ] No [X]
1
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
American Resource Technologies, Inc.
Balance Sheets
(Unaudited)
December 31 September 30
2007 2007
A S S E T S
- -----------
Current assets:
Cash $ 17,774 $ 25,280
Accounts receivable -- 2,117
Advances to related parties 70,801 64,225
------------ ------------
Total current assets 88,575 91,622
Property & equipment
Producing oil & gas properties, net of depletion 237,853 243,310
Furniture & fixtures, net of depreciation 19,500 20,250
------------ ------------
257,353 263,560
Other assets
Montgomery pipeline 34,789 34,789
------------ ------------
Total 34,789 34,789
Total assets $ 380,717 $ 389,971
============ ============
L I A B I L I T I E S and S T O C K H O L D E R S' E Q U I T Y
- -----------------------------------------------------------------
Current liabilities
Accounts payable 50,393 50,157
------------ ------------
Total current liabilities 50,393 50,157
Long-term liabilities
Long-term notes payable 60,000 50,000
------------ ------------
Total long-term liabilities 60,000 50,000
Stockholders' equity
Common stock, no par value
authorized 500,000,000 shares; 12,229,846
and 10,492,985 issued and outstanding, respectively
Additional paid-in capital 5,753,410 5,648,640
Accumulated deficit (5,483,086) (5,358,826)
------------ ------------
Total stockholders' equity 270,324 289,814
------------ ------------
Total liabilities and stockholders' equity $ 380,717 $ 389,971
============ ============
See accompanying notes.
2
American Resource Technologies, Inc.
Statements of Operations
For Three Months Ended December 31, 2007 and 2006
(Unaudited)
2007 2006
------------ ------------
Revenue
Oil and gas $ 17,089 $ --
Cost of Revenues
Lease operating expenses 8,102 11,117
Depletion 5,457 --
------------ ------------
Total Cost of Revenues 13,559 11,117
General & administrative expenses 127,791 27,424
------------ ------------
Total Operating Expenses 127,791 27,424
Net loss $ (124,261) $ (38,541)
============ ============
Loss per Share $ (0.01) $ (0.01)
============ ============
Weighted Average Shares Outstanding 11,399,772 5,586,727
============ ============
See accompanying notes.
3
American Resource Technologies, Inc.
Statement of Changes in Stockholders' Equity
For the Three Month Period Ended December 31, 2007
(Unaudited)
Common Stock Additional Total
Shares Paid in Accumulated Stockholders'
No par value Capital Deficit Equity
----------- ----------- ----------- -----------
Balances September 30, 2007 10,492,985 $ 5,648,640 $(5,358,826) $ 289,814
----------- ----------- ----------- -----------
Shares issued for:
Cash 160,000 25,000 25,000
Services 403,500 79,770 79,770
Note collateral 80,000 -- --
Dividend shares 1,093,361 -- --
Net loss (124,260) (124,260)
----------- ----------- ----------- -----------
Balances December 31, 2007 12,229,846 $ 5,753,410 $(5,483,086) $ 270,324
=========== =========== =========== ===========
See accompanying notes.
4
American Resource Technologies, Inc.
Statements of Cash Flows
For the Three Month Periods Ended December 31, 2007 & 2006
(Unaudited)
Cash Flows from Operating Activities: 2007 2006
- ------------------------------------- ---- ----
Net Loss $(124,261) $ (38,541)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depletion 5,457 --
Depreciation 750 750
Stock Issued for Services 79,770 4,000
Change in assets and liabilities:
Decrease(increase) in:
Accounts receivable --
Increase(Decrease) in:
Accounts Payable 236 12,522
--------- ---------
Net Cash Used in Operating Activities (38,048) (21,269)
Cash Flows from Investing Activities
- ------------------------------------
Advances to related parties (4,458) (4,401)
--------- ---------
Net Cash Used in Investing Activities (4,458) (4,401)
Cash Flows from Financing Activities:
- -------------------------------------
Long-term debt 10,000 --
Proceeds of stock sales 25,000 25,600
--------- ---------
Net Cash Provided by Financing Activities 35,000 25,600
Net Decrease in Cash (7,506) (70)
Cash -Beginning of period 25,280 191
--------- ---------
Cash -End of period $ 17,774 $ 121
========= =========
Supplementary Disclosure:
- -------------------------
Cash Paid for Interest $ 1,500 $ --
Cash Paid for Taxes -- --
Non-cash transactions:
- ----------------------
Shares Issued for:
Services $ 79,770 $ 4,000
See accompanying notes.
5
American Resource Technologies, Inc.
Notes to Financial Statements
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited financial statements of American Resource
Technologies, Inc. ("American Resources")have been prepared in accordance with
accounting principles generally accepted in the United States of America for
interim financial statements and with the instructions to Form 10-QSB and
Regulation S-B for the three month periods ended December 31, 2007 and 2006 and
reflect, in the opinion of management, all adjustments, which are of a normal
and recurring nature, necessary for a fair presentation of the results for such
periods. The foregoing financial statements do not include all information and
footnotes required by accounting principles generally accepted in the United
States of America for complete financial statements. However, except as
disclosed herein, there has been no material change in the information disclosed
in the notes to consolidated financial statements for the year ended September
30, 2006 included in the Company's Annual Report on Form 10-KSB filed with the
Securities and Exchange Commission. The interim unaudited financial statements
should be read in conjunction with the annual financial statements and
accompanying notes. Operating results for the three months ended December 31,
2007 are not necessarily indicative of the results that may be expected for the
year ending September 30, 2008.
New Accounting Standards
In December 2004, the FASB issued SFAS No.123R, "Accounting for Stock-Based
Compensation" ("SFAS No. 123R"). SFAS No.123R establishes standards for the
accounting for transactions in which an entity exchanges its equity instruments
for goods or services. This Statement focuses primarily on accounting for
transactions in which an entity obtains employee services in share-based payment
transactions. SFAS No.123R requires that the fair value of such equity
instruments be recognized as expense in the historical financial statements as
services are performed. Prior to SFAS No.123R, only certain pro forma
disclosures of fair value were required. American Resources adopted SFAS No.
123R as of October 1, 2005. The adoption of this standard had no effect on the
financial statements of Golden Chief.
NOTE 2 - COMMON STOCK
During the three months ending December 31, 2007, American Resources issued
160,000 shares of common stock for cash of $25,000. An additional 403,500 shares
were issued for services of $79,770, and 80,000 shares were issued as collateral
on long-term debt.
NOTE 3 - SUBSEQUENT EVENTS
The Company is working with its transfer agent to issue the dividend shares
discussed in the General section below. In January of 2008 the Company issued
100,000 shares of its common stock for consulting fees of $18,000.
NOTE 4 - STOCK OPTIONS
The following table lists the options outstanding at December 31, 2007.
Date of
Grantee Grant Exp. Date Price # Shares
- ------- ----- --------- ----- --------
Pinnacle Consulting Group, Inc. 8/10/2007 1/10/2012 $ 0.10 100,000
Pinnacle Consulting Group, Inc. 8/10/2007 1/10/2012 $ 0.15 100,000
Gary Hartstein 8/15/2007 8/15/2008 $ 0.125 100,000
William Becker 8/15/2007 8/15/2008 $ 0.125 100,000
Becker 1987 Trust 8/15/2007 8/15/2008 $ 0.125 40,000
Kahanic Trust 10/12/2007 10/31/2008 $0.15625 160,000
--------
Total options outstanding at 12/31/07 600,000
The outstanding options were purchased by the holders as part of their purchase
of restricted common shares on or about the issue date of the options.
6
In December 2004 FASB issued Statement of Financial Accounting Standards No. 123
(revised 2004), "Share-Based Payment" ("SFAS 123(R)") which requires companies
to recognize in the statement of operations all share-based payments to
employees, including grants of employee stock options based on their fair
values.
Item 2: Management's Discussion and Analysis of Financial Condition and Results
of Operations.
General:
On November 1, 2007 the Company's Board of Directors elected to declare a 10%
stock dividend effective for shareholders of record as of November 30, 2007. The
dividend shares are scheduled to be issued shortly.
On December 21, 2006 the Company held a special shareholders meeting at which
the shareholders approved a resolution authorizing the Board of Directors to
evaluate the necessity of a reverse stock split and also to implement a reverse
stock split if they determine it to be necessary. The stock split was
implemented in April of 2007 and resulted in a 1 for 50 reverse split. The
shareholders also ratified the actions of the officers and directors since the
last special shareholders meeting on December 17, 2001.
During the quarter ending December 31, 2006, six additional wells were drilled
on the Ownbey lease in Chautauqua County, Kansas pursuant to a farmout
agreement, which provides that the Company receives a "carried" working interest
in the wells. Production casing was set on all wells and completions operations
are continuing.
Capital Resources:
During the current quarter, our capital resources were extremely limited. Our
prospects will depend entirely on our ability to secure future financing.
The assets as of December 31, 2007 totaled $384,563, consisting primarily of the
producing leases previously acquired in the transaction with International
Royalty and Oil Co. in December 2004, and Sabine Operating Services in September
2005.
Revenues and Expenses:
During the current quarter, we recognized oil and gas revenue of $17,089 along
with lease operating expenses and depletion totaling $13,559.
During the quarter a year ago, we reported no revenues.
Gross income on oil & gas operations amounted to $3,530 for the three months
ended December 31, 2007. Total operating expense amounted to $127,791 for the
three months ended December 31, 2007, an increase of $100,367 from the same
period in the prior year resulting primarily from increased consulting fees
incurred during the quarter.
Liquidity:
Net cash used in operations for the three months ended December 31, 2007
amounted to $38,048 as compared to $21,269 for the comparable period of the
prior year. The increase resulted primarily from cash payments for operating
expenses.
Cash provided from financing activities for the three month period ended
December 31, 2007 amounts to $35,000 and consisted of cash proceeds from common
stock issuances and long-term debt.
Subsequent Events:
In January of 2008 the Company issued 100,000 shares of its common stock for
consulting fees of $18,000.
7
Disclosure Regarding Forward-Looking Statements:
Where this Form 10-QSB includes "forward-looking" statements within the meaning
of Section 27A of the Securities Act, we desire to take advantage of the "safe
harbor" provisions thereof. Therefore, we are including this statement for the
express purpose of availing itself of the protections of such safe harbor
provisions with respect to all of such forward-looking statements. The
forward-looking statements in this Form 10-QSB reflect our current views with
respect to future events and financial performance. These forward-looking
statements are subject to certain risks and uncertainties that could cause
actual results to differ from those anticipated. In this Form 10-QSB, the words
"anticipates," "believes, "expects," "intends," "future" and similar expressions
identify forward-looking statements. We undertake no obligation to publicly
revise these forward-looking statements to reflect events or circumstances that
may arise after the date hereof. All subsequent written and oral forward-looking
statements attributable to us or persons acting on our behalf are expressly
qualified in their entirety by this section.
PART II. OTHER INFORMATION
Item 2. Changes in Securities
There were no changes in securities during the current quarter.
ITEM 3. CONTROLS AND PROCEDURES.
a) Evaluation of Disclosure Controls and Procedures. As of December 31,
2007, the Company's management carried out an evaluation, under the
supervision of the Company's Chief Executive Officer and Chief
Financial Officer of the effectiveness of the design and operation of
the Company's system of disclosure controls and procedures pursuant to
the Securities and Exchange Act, Rule 13a-15(e) and 15d-15(e) under
the Exchange Act). Based upon that evaluation, the Chief Executive
Officer and Chief Financial Officer concluded that the Company's
disclosure controls and procedures were not effective, as of the date
of their evaluation, for the purposes of recording, processing,
summarizing and timely reporting material information required to be
disclosed in reports filed by the Company under the Securities
Exchange Act of 1934. Our auditors proposed material adjustments
related to the issuance of stock for services, among others, which
have been recorded by the Company. The Company is working to improve
our accounting expertise to eliminate such adjustments in the future.
b) Changes in internal controls. There were no changes in internal
controls over financial reporting, known to the Chief Executive
Officer or Chief Financial Officer that occurred during the period
covered by this report that has materially affected, or is likely to
materially effect, the Company's internal control over financial
reporting.
Item 4. Submission of Matters to a Vote of Securities Holders
On December 21, 2006 the Company held a special shareholders meeting at which
the shareholders approved a resolution authorizing the Board of Directors to
evaluate the necessity of a reverse stock split and also to implement a reverse
stock split if they determine it to be necessary. The shareholders also ratified
the actions of the officers and directors since the last special shareholders
meeting on December 17, 2001.
Item 6. Exhibits and Reports on Form 8-K
On November 1, 2007 a filing on Form 8-K was made informing that the directors
had declared a 10% stock dividend to shareholders of record as of November 30,
2007.
Exhibits
8
SIGNATURES
In accordance with Section 13 or 15 (d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
AMERICAN RESOURCE TECHNOLOGIES, INC.
Date: February 13, 2008 B. FRED ODEN, III
-----------------------
By: B. Fred Oden, III, President
Date: February 13, 2008 /s/ M. H. MCILVAIN
-----------------------
By: M. H. McIlvain, Executive Vice
President and Chief Financial
Officer
9