Here ya go. Looks like standard boilerplate to me.
__________________________
RISK FACTORS
LACK OF PROFITABILITY; CONTINUING LOSSES; AND DOUBTFUL ABILITY TO CONTINUE AS
A GOING CONCERN.
The Company has incurred losses of $39,279,422 from inception to June 30,
1997 and had not realized economic production as of June 30, 1997. As a result
of the Company's cumulative losses from operations, and the fact that the
Company has not realized economic production from its mineral properties, the
Company's independent auditor's report, dated August 29, 1997, for the year
ended June 30, 1997, states that these conditions raise substantial doubt
about the Company's ability to continue as a going concern. Management
continues to actively seek additional sources of capital to fund current and
future operations. There is no assurance that the Company will be successful
in continuing to raise additional capital, establishing probable or proven ore
reserves, or determining if the mineral properties can be mined economically.
Additionally, the Company is in default on the leases of certain of its mining
properties. The lessors have not taken action to foreclose on the leases and
the Company is making every effort to fulfill the agreements. The loss of
these leases would have a material adverse effect on the Company.
NEED FOR ADDITIONAL FINANCING; LACK OF LIQUIDITY; NO MATERIAL REVENUES.
The mining industry is capital intensive. During the fiscal year ended
June 30, 1997, the Company raised $2,111,101 from the sale of 16,387,113
shares of Common Stock. At June 30, 1997, the Company had a working capital
deficit of $2,332,905 and had no material revenues from mining operations.
Additional financing will be required in order for the Company to cover its
future mining and development costs and to engage in full scale mining
operation. At this time, the Company has no definitive plans regarding
additional financing, but believes that it will likely be obtained through
equity financing such as stock offerings or joint ventures. No assurances can
be given that the Company will be able to raise cash from additional financing
efforts and, even if such cash is raised, that it will be sufficient to
satisfy the Company's capital requirements. If the Company is unable to obtain
sufficient funds from future financings and/or operations, the Company may not
be able to achieve its business objectives and may have to scale back its
development plans. In addition, the Company may have to sell its assets in
order to meet its obligations and may lose some of its properties for failure
to make lease payments. In fiscal 1997, the Company sold equipment in order to
meet some of its obligations. In addition, the Company could lose some of its
properties for failure to make lease payments. On March 23, 1997, the
Company's lease on the Kate Hardy mine expired. However, the Company paid
$10,000 to the Kate Hardy lessor to extend the lease agreement on the Kate
Hardy mine for an additional three months. The Company is required to pay an
additional $10,000 to extend the lease for another three month period. The
Company also negotiated a modification agreement with Ruby Development Co.,
Inc. to pay, in cash, one lease payment in arrears for the Ruby mine, to pay
in cash, one month lease payment in arrears for the Rising Sun, increase the
amount of equipment held as collateral pursuant to the Ruby mine lease
agreement by filing a UCC-l financing statement listing the additional
equipment, all right, title and interest of certain "ore specimens" for which
Ruby Development Co., Inc. will credit the value against past due minimum
royalty payments, and grant Ruby Development Co., Inc., an option to purchase
up to 50,000 shares of the Company's common stock at a price of $.25 per share
until July 1, 1999. In the event the Company is unable to obtain additional
financing the Company may be required to seek protection under the bankruptcy
laws. |
