U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended: September 30, 2011
AMERIGO ENERGY, INC.
(Exact name of small business issuer as
specified in its charter)
Delaware 20-3454263
------ ----------
(State State or other (I.R.S. Employer
jurisdiction of incorporation Identification No.)
or organization)
2580 Anthem Village Drive
Henderson, NV 89052
---------------------------------------------------
(Address of principal executive offices) (Zip Code)
(702) 399-9777
---------------------------
(Issuer's telephone number)
Indicate by check mark 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 has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T
({section}232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
YES [ ] NO[ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ]
Accelerated filer [ ]
Non-accelerated filer [ ]
(Do not check if a smaller reporting company)
Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act)
YES [ ] NO [X]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
20,524,824 shares of common stock, $0.001 par value, as of November 15, 2011
TABLE OF CONTENTS
ITEM 1. FINANCIAL STATEMENTS................................................2
CONSOLIDATED BALANCE SHEET................................................3
CONSOLIDATED STATEMENT OF OPERATIONS......................................4
CONSOLIDATED STATEMENT OF CASH FLOWS......................................5
NOTES TO FINANCIAL STATEMENTS.............................................6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK..........12
ITEM 4. CONTROLS AND PROCEDURES............................................13
PART II - OTHER INFORMATION..................................................14
ITEM 1. LEGAL PROCEEDINGS..................................................14
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS..........................15
ITEM 3. DEFAULTS UPON SENIOR SECURITIES....................................15
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS................15
ITEM 5. OTHER INFORMATION..................................................16
ITEM 6. EXHIBITS...........................................................16
SIGNATURES...................................................................17
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BALANCE SHEETS
AS OF AS OF
SEPTEMBER 30, DECEMBER 31,
2011 2010
ASSETS
Current assets
Cash 361 $ 372
Accounts receivable - 12,416
------------ ------------
Total current assets 361 12,788
Other current assets
Advances to related party 5,554 5,455
------------ ------------
Total other current assets 5,554 5,455
Property, plant and equipment
Development wells, net of depletion 2,114 151,749
Software, net 3,370 4,284
------------ ------------
Total property, plant and equipment 5,484 156,034
Other Assets
Deposits 950 950
------------ ------------
Total other assets 950 $ 950
------------ ------------
Total assets 12,349 $ 175,227
============ ============
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
00Current liabilities
Accounts payable and accrued liabilities 36,123 $ 139,936
Accounts payable - related party 184,002 201,250
Advances from related parties 38,361 38,873
Lawsuit settlement payable 120,000 -
Payroll liabilities 18,000 55,980
Judgement payable - 120,000
------------ ------------
Total current liabilities 396,486 556,039
Long-term liabilities
Notes payable - related parties - 368,904
Accrued interest - related parties 38,036 38,036
------------ ------------
Total liabilities 434,522 962,979
Stockholders' (deficit)
Preferred stock (25,000,000 shares authorized
& 500,000 shares outstanding at Sept. 30, 2011) 500 500
Common stock; $.001 par value; 100,000,000
shares authorized; 20,555,547 shares outstanding
at Sept. 30, 2011 31,067 33,356
Additional paid-in capital 15,225,068 14,608,105
Accumulated deficit (15,678,809) (15,429,712)
------------ ------------
Total stockholders' (deficit) (422,174) (787,751)
------------ ------------
Total liabilities and stockholders' (deficit) 12,349 $ 175,227
============ ============
INCOME STATEMENTS
RESTATED RESTATED
NINE MONTHS THREE MONTHS
ENDED ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 2011 30, 2010 30, 2011 30, 2010
------------------------- ------------------------
Revenue
Oil revenues 22,748 109,237 1,839 21,515
Gas revenues 12,315 52,335 - 6,875
Rental income - 3,390 - -
----------------------- ------------------------
Total Revenue 35,063 164,963 1,839 28,390
Gross Profit 35,063 164,963 1,839 28,390
Operating expenses
Lease operating expenses 23,814 94,466 2,325 10,053
Selling, general and administrative 17,058 23,583 3,989 7,526
Professional fees 247,000 384,541 43,500 118,983
Depreciation and amortization expense 915 22,444 305 6,698
Depletion expense 1,547 14,792 37 3,536
----------------------- ------------------------
Total operating expenses 290,334 539,827 50,157 146,795
----------------------- ------------------------
Loss from operations (255,271) (374,865) (48,318) (118,405)
Other income (expenses):
Interest expense - (20,778) - (7,105)
Loss on investment in GreenStart, Inc. - (42,236) - (42,236)
Write off of assets/Loss on sale of assets - (149,991) - (127,908)
Other expense (157) (120,000) - -
Gain on extinguishment of debt 6,331 - - -
----------------------- ------------------------
Total other income (expenses) 6,174 (333,005) - (177,249)
----------------------- ------------------------
Loss before provision for income taxes (249,097) (707,870) (48,318) (295,654)
Provision for income taxes - - - -
Net loss $(249,097) $(707,870) $(48,318) $(295,654)
======================= ========================
Basic and diluted (loss) per common share (0.01) (0.03) (0.00) (0.01)
======================= ========================
Basic and diluted weighted average common shares
outstanding 20,524,824 22,814,331 20,524,824 22,814,331
======================= ========================
CASH FLOW
RESTATED
9 MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, 2011 SEPTEMBER 30, 2010
Cash flows from operating activities:
Net loss (249,097) (707,870)
Adjustments to reconcile net loss to
net cash used by operating activities:
Rounding error (13) -
Stock issued for services / settle debt 147,979 22,083
Debts settled with oil interest (2,988)
Stock issued to purchase assets 69
Depletion, depreciation and amortization 7,308 96,328
Impairment of assets - 37,626
Judgment payable - 42,236
Increase in accounts receivable 12,416 (19,711)
Increase / (decrease) in accounts payable (20) 39,253
Increase / (decrease) in accounts payable - related party 31,508 31,500
Increase / (decrease) in advances from related parties (321) 120,000
Increase / (decrease) in accrued payroll 53,148 189,000
----------------- -----------------
Net cash used by operating activities $ (11) $ (149,555)
Cash flows from investing activities:
Sale of office building $ 27,169
Disposal of Oil Leases $ 162,700
----------------- -----------------
Net cash used by investing activities $ - $ 189,869
Cash flows from financing activities:
Loan to (from) related party - $ (46,871)
Net cash provided by financing activities $ - $ (46,871)
----------------- -----------------
Net increase in cash (11) (6,557)
Cash, beginning of period 372 6,861
----------------- -----------------
Cash, end of period 361 $ 304
----------------- -----------------
Supplementary cash flow information:
Cash payments for income taxes
Cash payments for interest
Supplementary cash flow information:
Interest paid
Oil interest used to settle debts (8,099)
AMERIGO ENERGY, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
The interim financial statements included herein, presented in accordance with
United States generally accepted accounting principles and stated in US
dollars, have been prepared by the Company, without audit, pursuant to the
rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although the
Company believes that the disclosures are adequate to make the information
presented not misleading.
These statements reflect all adjustments, consisting of normal recurring
adjustments, which, in the opinion of management, are necessary for fair
presentation of the information contained therein. It is suggested that these
interim financial statements be read in conjunction with the financial
statements of the Company for the year ended December 31, 2010 and notes
thereto included in the Company's Form 10-K. The Company follows the same
accounting policies in the preparation of interim reports.
Results of operations for the interim periods are not indicative of annual
results.
Recent pronouncements:
The Company's management has reviewed all of the FASB's Accounting Standard
Updates through September 30, 2011 and has concluded that none will have a
material impact on the Company's financial statements. Management does not
believe that any other recently issued but not yet effective accounting
pronouncements, if adopted, would have an effect on the accompanying
consolidated financial statements.
Going Concern
The accompanying financial statements have been prepared on a going concern
basis, which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. The Company has incurred
cumulative net losses of approximately $15,581,086 since its inception and
requires capital for its contemplated operational and marketing activities to
take place. The Company's ability to raise additional capital through the
future issuances of the common stock is unknown. The obtainment of additional
financing, the successful development of the Company's contemplated plan of
operations, and its transition, ultimately, to the attainment of profitable
operations are necessary for the Company to continue operations. The ability to
successfully resolve these factors raise substantial doubt about the Company's
ability to continue as a going concern. The financial statements of the Company
do not include any adjustments that may result from the outcome of these
aforementioned uncertainties.
NOTE 2 - RESTATEMENT OF FINANCIALS
In March 2011, the Company determined, as well as hindsight lends to confirm,
that the assets purchased during 2008 should have been impaired and/or recorded
in 2008 and then subsequently written down in 2009 and 2010. The assets were
originally recorded at the historical cost of the seller; however, the
production and collectability from the operator in Oklahoma have all proven to
be less than expected.
The following is a summary of the restatements for September 30, 2010
Increase (Decrease)
in Account/Amount
Total Assets (596,277)
Total Stockholders Equity (592,798)
Net Income (Loss) (1,199,424)
Net Income (Loss) per share (0.01)
The effect on the company's previously issued September 30, 2010 financial
statements is summarized as follows:
Balance Sheet as of September 30, 2010
Previously
Reported (Decrease) Restated
Current Assets 181,043 (44,984) 136,059
Other Assets 792,692 (551,293) 241,399
------- --------- --------
Total Assets 973,735 (596,277) 377,458
Current Liabilities 536,203 (3,500) 532,703
Other Liabilities 399,789 0 399,789
------- --------- --------
Total Liabilities 935,992 (3,500) 932,492
Stockholders' Equity 37,744 (592,778) (555,034)
------- --------- --------
Total Liabilities and Stockholders' Deficit 973,736 (596,278) 377,458
Statement of Operations for quarter ended September 30, 2010
Previously Increase
Reported (Decrease) Restated
Net Sales 164,963 - 164,963
Operating Expenses 598,919 (59,092) 539,827
------- --------- --------
Income (Loss) from Operations (433,957) (59,092) (374,865)
Other income (expenses) (1,473,337) (1,140,332) (333,005)
---------- --------- --------
Net Income (Loss) (1,907,294) (1,199,424) (707,870)
NOTE 3 - OIL AND GAS LEASES
DURING THE NINE MONTHS ENDED SEPTEMBER 30, 2011:
On March 1, 2011 the company settled $150,361 in debt on the company books with
oil interest held by the company in leases operated by H Petro R.
On September 1, 2011 the company settled $102,723 in debt on the company books
with oil interest held by the company. These leases were previously written
off due to non production which resulted in an increase in paid in capital on
the books of the company. .
For the nine months ended September 30, 2011, the Company generated royalties
on producing oil and gas properties in the amount of $35,063. For the nine
months ended September 30, 2010, the Company generated royalties on producing
oil and gas properties in the amount of $164,963.
The depletion expense for the nine months ended September 30, 2011 and 2010 was
$1,547 and $14,792, respectively, was calculated based on an estimate using the
straight line method over the estimated lives of the proved interests until
production studies have been completed on the oil and gas properties.
NOTE 4 - NOTES PAYABLE
As of December 31, 2010, the Company had issued three notes payable for a total
of $373,365 as part of the purchase of certain lease oil, gas, and mineral
interests. The obligations were to be paid monthly for a period of five years
with interest of seven percent (7%) accruing on the outstanding balance.
As of September 30, 2011, the company settled all of the principle amounts on
these notes leaving only the accrued interest in the amount of $38,036.
On September 1, 2011 the company settled $102,723 in debt on the company books
with oil interest held by the company. These leases were previously written
off due to non production which resulted in an increase in paid in capital on
the books of the company. The CEO of the company settled $24,000 of monies
owed to him for a minority interest in the West Burke lease.
NOTE 5 - STOCKHOLDERS' EQUITY
As of September 30, 2011, there were 20,555,547 shares of common stock
outstanding and 500,000 preferred shares outstanding.
DURING THE NINE MONTHS ENDED SEPTEMBER 30, 2011, THE COMPANY ISSUED COMMON
STOCK AS FOLLOWS:
During the quarter ended March 31, 2011, the company issued 5,141,216 shares of
common stock to settle $446,880 in debts on the company books.
During the quarter ended March 31, 2011, the company issued 1,000,000 shares of
common stock to a consultant for services rendered and valued at $70,000.
During the quarter ended March 31, 2011, the company issued 69,277 shares of
common stock for oil interest previously purchased in 2009. These shares should
have been issued by our previous transfer agent but upon review the company
realized that they never were issued.
During the quarter ended June 30, 2011, the company entered into a settlement
agreement with Granite Energy, Inc. for the return of 8,500,000 shares of the
company's common stock. These shares were returned to the company's treasury
and our outstanding shares decreased.
The company did not issue any common or preferred stock during the quarter
ended September 30, 2011.
The company settled $102,723 of debts on the companies books to related parties
with written off non-performing assets, which resulted in an increase in
additional paid in capital on the books of the company.
NOTE 6 - RELATED PARTY TRANSACTIONS
As of September 30, 2011, the Company had $18,000 in accrued payroll payable to
the Company's current officers.
The Company has a consulting agreement with a firm controlled by the Company's
Chief Financial Officer for a fee of $8,500 per month. The consulting firm has
been engaged to assist in organizing and completing the process of filings with
the Securities and Exchange Commission and other tasks. The Company owed the
firm $181,173 as of September 30, 2011 which is included as part of Accounts
payable - related party in the accompanying financial statements.
As discussed in Note 4, the Company had issued three notes payable for a total
of $373,365 as part of the purchase of certain lease oil, gas, and mineral
interests. The obligations were to be paid monthly for a period of five years
with interest of seven percent (7%) accruing on the outstanding balance. A
material relationship existed between Bullfrog Management, LLC and the Company
in that Bullfrog Management, LLC is managed by the wife of S. Matthew Schultz,
the former CEO of Amerigo Energy. A material relationship also exists between
Peachtree Consultants, LLC and the Company in that it is managed by a firm
owned by the CEO of Amerigo Energy, Jason F. Griffith. Jacque Lybbert is the
wife of Bruce Lybbert, a former Director of the Company. As of September 30,
2011, the company settled all of the principle amounts on these notes leaving
only the accrued interest in the amount of $38,036.
On September 1, 2011 the company settled $102,723 in debt on the company books
with oil interest held by the company. These leases were previously written
off due to non production which resulted in an increase in paid in capital on
the books of the company. The CEO of the company settled $24,000 of monies
owed to him for a minority interest in the West Burke lease.
NOTE 7 - SUBSEQUENT EVENTS
The Company's auditor was served a subpoena by the judgment holder and was
verbally notified by the judgment holder that he was planning on petitioning
for the company to be assigned a receiver by the courts in Nevada. The company
was served paperwork regarding a receivership hearing and responded through
legal counsel. The hearing has not taken place at the court as the parties
have been attempting to come to a resolution prior to going to the hearing.
The Company was given a copy of a lawsuit, which was filed in Utah, by a couple
claiming damages. Management has assessed the merits of the claim, along with
the evidence available and feels the Company has no exposure. Management will
be seeking counsel in Utah to respond accordingly.
The Company has evaluated subsequent events through November 18, 2011, the date
which it has made its financial statements available, and has identified no
significant reportable events through that date other than listed above.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We have filed with the Securities and Exchange Commission this Form 10-Q,
including exhibits, under the Securities Act. You may read and copy all or any
portion of the registration statement or any reports, statements or other
information in the files at SEC's Public Reference Room located at 100 F
Street, NE., Washington, DC 20549, on official business days during the hours
of 10 a.m. to 3 p.m.
You can request copies of these documents upon payment of a duplicating fee by
writing to the Commission. You may call the Commission at 1-800-SEC-0330 for
further information on the operation of its public reference room. Our filings,
including the registration statement, will also be available to you on the
website maintained by the Commission at http://www.sec.gov.
We intend to furnish our stockholders with annual reports which will be filed
electronically with the SEC containing consolidated financial statements
audited by our independent auditors, and to make available to our stockholders
quarterly reports for the first three quarters of each year containing
unaudited interim consolidated financial statements.
The company's website address is ttp://www.amerigoenergy.com; however, the site
has recently come down and is being revamped to account for the updates to the
company's business plan. Our website and the information contained on that
site, or connected to that site, is not part of or incorporated by reference
into this filing.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
PRELIMINARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This discussion contains forward-looking statements. The reader should
understand that several factors govern whether any forward-looking statement
contained herein will be or can be achieved. Any one of those factors could
cause actual results to differ materially from those projected herein. These
forward-looking statements include plans and objectives of management for
future operations, including plans and objectives relating to the products and
the future economic performance of the Company. Assumptions relating to the
foregoing involve judgments with respect to, among other things, future
economic, competitive and market conditions, future business decisions, and the
time and money required to successfully complete development projects, all of
which are difficult or impossible to predict accurately and many of which are
beyond the control of the Company. Although the Company believes that the
assumptions underlying the forward-looking statements contained herein are
reasonable, any of those assumptions could prove inaccurate and, therefore,
there can be no assurance that the results contemplated in any of the forward-
looking statements contained herein will be realized. Based on actual
experience and business development, the Company may alter its marketing,
capital expenditure plans or other budgets, which may in turn affect the
Company's results of operations. In light of the significant uncertainties
inherent in the forward-looking statements included therein, the inclusion of
any such statement should not be regarded as a representation by the Company or
any other person that the objectives or plans of the Company will be achieved.
A complete discussion of these risks and uncertainties are contained in our
Annual Financial Statements included in the Form 10-K for the fiscal year ended
December 31, 2010, as filed with the Securities and Exchange Commission on
March 31, 2011.
INTRODUCTION
The Company derives its revenues from its producing oil and gas
properties, of which the substantial majority are predominantly oil properties.
These properties consist of working interests in producing oil wells having
proved reserves. Our capital for investment in producing oil properties has
been provided by the sale of common stock to its shareholders. The company is
currently entertaining additional opportunities for purchase of oil leases as
well as other business acquisitions to enhance shareholder value.
The following is a discussion of the Company's financial condition, results of
operations, financial resources and working capital. This discussion and
analysis should be read in conjunction with the Company's financial statements
contained in this Form 10-Q.
OVERVIEW
RESULTS OF OPERATIONS
REVENUES
For the three months ended September 30, 2011, the Company generated royalties
on producing oil and gas properties in the amount of $1,839. For the three
months ended September 30, 2010, the Company generated $28,390 in revenues from
royalties on producing oil and gas properties.
For the nine months ended September 30, 2011, the Company generated royalties
on producing oil and gas properties in the amount of $35,063. For the nine
months ended September 30, 2010, the Company generated $3,390 in revenues from
the rental income in addition to royalties on producing oil and gas properties
in the amount of $164,963.
OPERATING EXPENSES
THREE MONTHS ENDED:
Lease Operating - Lease operating expense for the three months ended September
30, 2011 totaled $2,325 as compared to $10,053 for the three months ended
September 30, 2010. The decrease is directly related to the sale of the
Company's interest in most of their leases.
General and Administrative - General and administrative expenses were $3,989
for the three months ended September 30, 2011, compared to $7,526 for the three
months ended September 30, 2010.
Professional Fees - Professional fees for the three months ended September 30,
2011 were $43,500 as compared to $118,983 for the three months ended September
30, 2010. The decrease was related to the decrease in the use of consultants
and a decrease in accounting fees.
Depreciation, Amortization, and Depletion - Depreciation and amortization
expenses were $305 for the three months ended September 30, 2011 compared to
$6,698 for the three months ended September 30, 2010. The decrease is directly
related to the write off of assets at year ended December 31, 2010. The
depletion expense for the three months ended September 30, 2011 was $37 and was
calculated based on an estimate using the straight line method over the
estimated lives of the proved interests until production studies have been
completed on the oil and gas properties. There was $3,536 in depletion expenses
for the three months ended September 30, 2010. The decrease is related to the
sale of certain oil and gas interests during the previous year.
NINE MONTHS ENDED:
Lease Operating - Lease operating expense for the nine months ended September
30, 2011 totaled $23,814 as compared to $94,466 for the nine months ended
September 30, 2010. The decrease is directly related to the sale of the
Company's interest in most of their leases.
General and Administrative - General and administrative expenses were $17,058
for the nine months ended September 30, 2011, compared to $23,583 for the nine
months ended September 30, 2010.
Professional Fees - Professional fees for the nine months ended September 30,
2011 were $247,000 as compared to $384,541 for the nine months ended September
30, 2010. The decrease was related to the decrease in the use of consultants
and a decrease in accounting fees.
Depreciation, Amortization, and Depletion - Depreciation and amortization
expenses were $915 for the nine months ended September 30, 2011 compared to
$22,444 for the nine months ended September 30, 2010. The decrease is directly
related to the write off of assets at year ended December 31, 2010. The
depletion expense for the nine months ended September 30, 2011 was $1,547 and
was calculated based on an estimate using the straight line method over the
estimated lives of the proved interests until production studies have been
completed on the oil and gas properties. There was $14,792 in depletion
expenses for the nine months ended September 30, 2010. The decrease is related
to the sale of certain oil and gas interests during the previous year.
OTHER INCOME AND EXPENSES
During the nine months ended September 30, 2011, interest expense was $0,
compared to $20,778 during the nine months ended September 30, 2010,
representing a decrease of $20,778. The decrease relates to the write off of
the note receivable during 2010.
The company recorded a gain of $6,331 on extinguishment of debt in relation to
debts from non-related parties the company was able to settle during the period
ended September 30, 2011.
NET LOSS ATTRIBUTABLE TO COMMON STOCK
The Company realized a net loss of $48,318 for the three months ended September
30, 2011, compared to a net loss of $295,654 for the three months ended
September 30, 2010, a decrease of $247,336. The decrease in net loss is
partially attributable to a decrease lease operating expense and depletion
expense as compared to the three months ended September 30, 2010.
The Company realized a net loss of $249,097 for the nine months ended September
30, 2011, compared to a net loss of $707,870 for the nine months ended
September 30, 2010, a decrease of $458,773. The decrease in net loss is
partially attributable to a decrease lease operating expense and depletion
expense as compared to the nine months ended September 30, 2010.
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 2011, we had cash in the amount of $361 and a working capital
deficit of $390,571. In addition, our stockholders' deficit was $422,174 at
September 30, 2011.
Our accumulated deficit increased from $15,429,712 at December 31, 2010 to
$15,678,809 at September 30, 2011.
Our operations used net cash of $11 during the 9 months ended September 30,
2011, compared to losing ($149,555) during the quarter ended September 30,2010,
a decrease of $149,544.
Net cash provided by investing activities was $0 for the 9 months ended
September 30, 2011 and $189,869 for the 9 months ended September 30, 2010.
Our financing activities provided net cash of $0 during the 9 months ended
September 30, 2011, compared to net cash of $46,871 during the 9 months ended
September 30, 2010.
INFLATION
The Company's results of operations have not been affected by inflation and
management does not expect inflation to have a material impact on its
operations in the future.
OFF- BALANCE SHEET ARRANGEMENTS
The Company currently does not have any off-balance sheet arrangements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
Not Applicable
ITEM 4. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS
We evaluated the effectiveness of our disclosure controls and procedures as of
September 30, 2011, the end of the period covered by this Quarterly Report on
Form 10-Q. This evaluation was undertaken by our Chief Executive Officer and
Chief Financial Officer, Jason F. Griffith.
Mr. Griffith serves as our principal executive officer and as our principal
accounting and financial officer.
We reviewed and evaluated the effectiveness of the design and operation of our
disclosure controls and procedures, as of the end of the fiscal quarter covered
by this report, as required by Securities Exchange Act Rule 13a-15, and
concluded that our disclosure controls and procedures are effective to ensure
that information required to be disclosed in our reports filed with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934, as amended, is accumulated and communicated to management on a timely
basis, including our principal executive officer and principal financial and
accounting officer.
CONCLUSIONS
Based on this evaluation, our principal executive officer and principal
financial and accounting officer concluded that our disclosure controls and
procedures are effective to ensure that the information we are required to
disclose in reports that we file pursuant to the Exchange Act are recorded,
processed, summarized, and reported in such reports within the time periods
specified in the Securities and Exchange Commission's rules and forms.
CHANGES IN INTERNAL CONTROLS
There were no changes in our internal controls over financial reporting that
occurred during the last fiscal quarter, i.e., the nine months ended September
30, 2011, that have materially affected, or are reasonably likely to materially
affect, our internal controls over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
Amerigo has signed an agreement with the individual to acquire his interest in
certain oil and gas leases for $120,000, payable at $10,000 per month starting
April 1, 2010, with subsequent payments due on the 1st of each month. The
company has not kept current with the agreement and the individuals promissory
note has now been escalated to a judgment against the company. As of the
date of this filing, terms of settling the judgment have not been resolved.
The company was served paperwork regarding a receivership hearing and responded
through legal counsel. The hearing has not taken place at the court as the
parties have been attempting to come to a resolution prior to going to the
hearing.
The Company was given a copy of a lawsuit, which was filed in Utah, by a couple
claiming damages. Management has assessed the merits of the claim, along with
the evidence available and feels the Company has no exposure. Management will
be seeking counsel in Utah to respond accordingly.
As of November 17, 2011, other than the lawsuit disclosed in the previous
paragraphs, the Company is not a party to any pending material legal
proceeding. To the knowledge of management, no federal, state or local
governmental agency is presently contemplating any proceeding against the
Company. To the knowledge of management, no director, executive officer or
affiliate of the Company, any owner of record or beneficially of more than five
percent of the Company's Common Stock is a party adverse to the Company or has
a material interest adverse to the Company in any proceeding.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 5. OTHER INFORMATION.
Not applicable.
ITEM 6. EXHIBITS
(a) Exhibits.
31.1 Certification of our Principal Executive Officer and Principal Financial
and Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
32.1 Certification of our Chief Executive Officer and Chief Financial Officer
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section
1350)
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Date: November 17, 2011
By: /s/ Jason F. Griffith
---------------------
Jason F. Griffith
Chief Executive Officer,
and Chief Financial Officer