UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ________ to ________
Commission File No.
(Exact name of Registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
(Address of principal executive offices) | (Zip/Postal Code) |
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(Telephone Number) ___________ | |
(Former name or former address if changed since last report)
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 period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
[X]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ¨ | Accelerated filer | ¨ |
¨ | Smaller reporting company | ||
| Emerging growth company | ||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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As of November 13, 2023, there are issued and outstanding only common equity shares in the amount of
SPECTRAL CAPITAL CORPORATION
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION |
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Item 1. | F-1 | |
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Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 12 |
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Item 3. | 13 | |
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Item 4. | 14 | |
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PART II - OTHER INFORMATION |
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Item 1. | 15 | |
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Item 1A. | 15 | |
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Item 2. | 15 | |
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Item 3. | 15 | |
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Item 4. | 15 | |
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Item 5. | 15 | |
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Item 6. | 15 | |
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16 | ||
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Form 10-K, press releases and certain information provided periodically in writing or verbally by our officers or our agents contain statements which constitute forward-looking statements. The words “may”, “would”, “could”, “will”, “expect”, “estimate”, “anticipate”, “believe”, “intend”, “plan”, “goal”, and similar expressions and variations thereof are intended to specifically identify forward-looking statements. These statements appear in a number of places in this Form 10-K and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of us, our directors or our officers, with respect to, among other things: (i) our liquidity and capital resources; (ii) our financing opportunities and plans; (iii) our ability to generate revenues; (iv) competition in our business segments; (v) market and other trends affecting our future financial condition or results of operations; (vi) our growth strategy and operating strategy; (vii) the declaration and/or payment of dividends; and (viii) any statements regarding any reserves, potential reserves, potential mineral yield or extraction costs with respect to our mining properties.
Investors and prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. The factors that might cause such differences include, among others, those set forth in Part II, Item 7 of this annual report on Form 10-K, entitled Management’s Discussion and Analysis or Plan of Operation, including without limitation the risk factors contained therein. Except as required by law, we undertake no obligation to update any of the forward-looking statements in this Form 10-K after the date of this report.
Item 1: Financial Statements
Our unaudited interim financial statements for the three and nine months ended September 30, 2023 and 2022 are part of this quarterly report. They are stated in United States Dollars (US$) and are prepared in accordance with United States generally accepted accounting principles.
INDEX TO UNAUDITED FINANCIAL STATEMENTS | ||
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Condensed Consolidated Financial Statements of Spectral Capital Corporation, Inc. |
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| Condensed Consolidated Balance Sheets as of September 30, 2023 | F-2 |
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| Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2023 and 2022 (unaudited) | F-3 |
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| Condensed Consolidated Statements of Stockholders' Deficit for the Three and Nine Months Ended September 30, 2023 and 2022 (unaudited) | F-4 |
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| Condensed Consolidated Statements of Cash Flows for the Nine | F-6 |
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| Notes to the Condensed Consolidated Financial Statements (unaudited) | F-7 |
F-1
SPECTRAL CAPITAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2023 AND DECEMBER 31, 2022
(UNAUDITED)
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Assets: |
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Cash and cash equivalents |
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Accounts receivable |
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Current assets |
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Total assets |
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Liabilities and Stockholders' Deficit: |
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Current liabilities |
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Accounts payable and accrued liabilities |
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Related party advances and accruals |
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Short-term advances |
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Current liabilities |
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Commitments and contingencies |
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Stockholders' Deficit: |
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Preferred stock, par value $ |
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Common stock, par value $ |
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Additional paid-in capital |
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Accumulated deficit |
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Total stockholders' equity (deficit) |
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Non-controlling interest |
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Total stockholders' deficit - Spectral Capital Corp. |
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Total liabilities and stockholders' deficit |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
F-2
SPECTRAL CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022
(UNAUDITED)
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Revenues |
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Costs of sales |
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Gross loss |
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Operating expenses: |
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Selling, general and administrative |
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Wages and benefits |
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Total operating expenses |
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Net loss before non-controlling interest |
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Loss attributable to non-controlling interest |
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Net loss attributable to Spectral Capital Corporation |
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Basic and diluted loss per common share |
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Weighted average shares - basic and diluted |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
F-3
SPECTRAL CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022
(UNAUDITED)
Three Months Ended September 30, 2022
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| Additional Paid-in |
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June 30, 2022 |
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Non-controlling interest |
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Net income |
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September 30, 2022 |
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Nine Months Ended September 30, 2022
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December 31, 2021 |
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Proceeds from sale of common stock |
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Conversion of convertible note |
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Non-controlling interest |
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Net loss |
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September 30, 2022 |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
F-4
SPECTRAL CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022
(UNAUDITED)
Three Months Ended September 30, 2023
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| Additional Paid-in |
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June 30, 2023 |
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Non-controlling interest |
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Net loss |
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September 30, 2023 |
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Six Months Ended September 30, 2023
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December 31, 2022 |
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Non-controlling interest |
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Net loss |
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September 30, 2023 |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
F-5
SPECTRAL CAPITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBR 30, 2023 AND 2022
(UNAUDITED)
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net loss attributable to Spectral Capital Corporation |
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Adjustments to reconcile net loss to net cash |
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Non-controlling interest |
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Changes in operating assets and liabilities: |
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Accounts receivable |
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Due to related parties - accrued salary |
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Accounts payable and accrued expenses |
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Net cash provided by (used in) operating activities |
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CASH FLOWS FROM INVESTING ACTIVITIES: |
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Net cash used in investing activities |
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CASH FLOWS FROM FINANCING ACTIVITIES: |
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Proceeds from sale of common stock |
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Net cash provided by financing activities |
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Change in cash and cash equivalents |
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Cash and cash equivalents, end of period |
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Supplemental disclosures of cash flow information: |
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Cash paid for interest |
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Cash paid for income taxes |
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Non-cash investing and financing activities: |
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Exchange of related party advances and accruals for a convertible |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
F-6
SPECTRAL CAPITAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2023
(UNAUDITED)
NOTE 1 – BUSINESS AND NATURE OF OPERATIONS
Spectral Capital Corporation (the "Company" or "Spectral") was incorporated on September 13, 2000 under the laws of the State of Nevada. Spectral is focused on the identification, acquisition, development, financing of technology that has the potential to transform existing industries. The Company looks for technology that can be protected through patents or laws regarding trade secrets.
In January 2022, the Company commenced a new line of business which is providing data and telecommunications reselling services on a global basis. On February 15, 2022, the Company entered into a telecommunications services agreement with Sky Data PLL OU (Estonia) to provide long distance switching services. The contract does not contain a fixed term or value and is on an as needed basis via invoice for Sky Data PLL OU.
Spectral intends to expand its reach within the telecommunications reselling services market and has identified the following steps in order to resume this line of business: ownership of infrastructure, control of data flow and the elimination of third parties. This progression will provide significant cost savings and allow the company direct access to the data in real time to optimize service and to gain the most traffic in high demand areas. These steps will also enable Spectral to provide better service with the hope to gain better contracts over time. In conjunction with its partner Sky, ownership of infrastructure is underway, and the companies are currently in talks to secure contracts with providers.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Going Concern
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has recently discontinued revenue generating activities and has sustained substantial losses since inception. As of September 30, 2023, the Company has cash on hand of $
To date management has funded its operations through selling equity securities and advances from related parties. The ability of the Company to continue as a going concern is dependent on the Company generating cash from its recently established operations, the sale of its common stock and/or obtaining debt financing and attaining future profitable operations, however, there can be no assurance the Company will be successful in these efforts. As of the date of these consolidated financial statements the Company does not have any firm commitments for capital. Without the required capital, the Company has had to reduce their development expenditures which will delay the completion of products which are expected to generate future revenues.
Risks and Uncertainties
The Company has a limited operating history and has not generated revenues from our planned principal operations.
The Company's business and operations are sensitive to general business and economic conditions in the U.S. and worldwide. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the U.S. and world economy. A host of factors beyond the Company's control could cause fluctuations in these conditions, including the political environment and acts or threats of war or terrorism. Adverse developments in these general business and economic conditions, including through recession, downturn or otherwise, could have a material adverse effect on the Company's consolidated financial condition and the results of its operations.
The Company currently has generated limited revenues and limited marketing and/or distribution capabilities. The Company has limited experience in developing, training or managing a sales force and will incur substantial additional expenses if we decide to market any of our current and future products. Developing a marketing and sales force is also time consuming and could delay launch of our future products. In addition, the Company will compete with many companies that currently have extensive and well-funded marketing and sales operations. Our marketing and sales efforts may be unable to compete successfully against these companies. In addition, the Company has limited capital to devote sales and marketing.
F-7
SPECTRAL CAPITAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2023
(UNAUDITED)
The Company's industry is characterized by rapid changes in technology and customer demands. As a result, the Company's products may quickly become obsolete and unmarketable. The Company's future success will depend on its ability to adapt to technological advances, anticipate customer demands, develop new products and enhance our current products on a timely and cost-effective basis. Further, the Company's products must remain competitive with those of other companies with substantially greater resources. The Company may experience technical or other difficulties that could delay or prevent the development, introduction or marketing of new products or enhanced versions of existing products. Also, the Company may not be able to adapt new or enhanced products to emerging industry standards, and the Company's new products may not be favourably received. Nor may we have the capital resources to further the development of existing and/or new ones.
Interim Consolidated Financial Statements
The accompanying unaudited interim consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission. Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these consolidated financial statements have been included. Such adjustments consist of normal recurring adjustments. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2022. The results of operations for the nine months ended September 30, 2023 are not indicative of the results that may be expected for the full year.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company, Spectral Holdings, Inc, and its
Basis of Presentation
The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.
Fair Value of Financial Instruments
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:
Level 1 | Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. |
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Level 2 | Include other inputs that are directly or indirectly observable in the marketplace. |
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Level 3 | Unobservable inputs which are supported by little or no market activity. |
The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. As of September 30, 2023 and December 31, 2022, the Company does not have any assets or liabilities which would be considered Level 2 or 3.
The Company’s financial instruments consist of cash and cash equivalents, investments in technologies and related party advances. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these consolidated financial statements.
F-8
SPECTRAL CAPITAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2023
(UNAUDITED)
The Company measures certain assets at fair value on a nonrecurring basis. These assets include cost method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in an acquisition or in a nonmonetary exchange, and property and equipment and intangible assets that are written down to fair value when they are held for sale or determined to be impaired. Excluding these items, the Company did not have any significant assets or liabilities that were measured at fair value on a nonrecurring basis in periods subsequent to initial recognition.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Revenue Recognition
The Company revenues in accordance with Accounting Standards Codification (“ASC”) 606, “Revenue from contracts with customers”. Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenues during the nine months ended September 30, 2023, were provided primarily to three customers. The loss of these customers would have a significant impact on the Company’s financial statements. At September 30, 2022, the Company paused their operations to improve their internal processes and are working towards resuming operations by April of 2024.
Basic Income (Loss) Per Share
Basic loss per share is calculated by dividing the Company’s net income (loss) applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. During the three and nine months ended September 30, 2023 and 2022, the Company did not have not dilutive shares.
Non-Controlling Interests
Non-controlling interest disclosed within the consolidated statement of operations represents the minority ownership 40% share of net income (losses) of Noot Holdings, Inc. and Monitr Holdings, Inc. incurred during the nine months ended September 30, 2023. The following table sets forth the changes in non-controlling interest for the nine months ended September 30, 2023:
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Balance at December 31, 2022 |
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Net loss attributable to non-controlling interest |
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Balance at March 31, 2023 |
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Foreign Currency
The Company's functional currency is the United States Dollar. Transaction gains or losses related to balances denominated in a currency other than the functional currency are recognized in the consolidated statements of operations. As a result of these foreign currency transactions in which require payment in a currency other than the United States Dollar, the Company has recorded foreign currency (income) losses within the accompanying condensed consolidated statement of operations.
F-9
SPECTRAL CAPITAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2023
(UNAUDITED)
Recent Accounting Pronouncements
The FASB issues ASUs to amend the authoritative literature in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). There have been a number of ASUs to date, including those above, that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company’s financial statement.
NOTE 3– RELATED PARTY TRANSACTIONS
Jenifer Osterwalder, the Company's Chief Executive Officer
Jenifer Osterwalder charges the Company $12,000 per month beginning January 1, 2021 for services rendered. Total amounts expended in the Company's condensed consolidated financial statements in connection with the CEO's services was $
From time to time due to the limited cash flow available, the Company's CEO pays certain operating expenditures on behalf of the Company. These advances bear no interest and are due on demand. As of September 30, 2023 and December 31, 2022, the Company's CEO was due $
As noted above, all amounts due to the Chief Executive Officer as December 31, 2021 were converted into a convertible note payable. The note is due and demand and convertible at $0.05 per share. During the three months ended March 31, 2022, the Chief Executive Officer sold the $1,054,653 and $206,956 convertible notes to a third party which was then converted into approximately 25.2 million shares in April 2022.
NOTE 4 – STOCKHOLDERS’ DEFICIT
Changes in Stockholders' Deficit
During the nine months ended September 30, 2022, the Company sold 5 million shares of common stock resulting in proceeds of $
See Note 3 for discussion of convertible note converted into common stock.
Employee Options
The Company accounts for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation – Stock Compensation which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.
The Company has adopted a stock option and award plan to attract, retain and motivate its directors, officers, employees, consultants and advisors. Options provide the opportunity to acquire a proprietary interest in the Company and to benefit from its growth. Vesting terms and conditions are determined by the Board of Directors at the time of the grant. The Plan provides for the issuance of up to 15,000,000 common shares for employees, consultants, directors, and advisors. As of September 30, 2023, all options were expired.
NOTE 5 – ADVANCES
During the nine months ended September 30, 2023, the Company received advances of $
F-10
SPECTRAL CAPITAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2023
(UNAUDITED)
NOTE 6 – COMMITMENTS AND CONTINGENCIES
The Company leases office space on a three-month basis in Seattle, Washington.
NOTE 7– SUBSEQUENT EVENTS
In accordance with ASC 855-10, the Company has analyzed its operations subsequent to September 30, 2023 to the date these condensed consolidated financial statements were issued and has determined that it does not have any material subsequent events to disclose in these consolidated financial statements, other than disclosed above.
F-11
Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
The following discussion and analysis of our financial condition and results of our operations should be read in conjunction with our financial statements and related notes appearing elsewhere in this report. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements. The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and related notes included in this report and those in our Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission on March 27, 2023 and all subsequent filings.
OVERVIEW
Spectral Capital Corporation (the "Company" or "Spectral") was incorporated on September 13, 2000 under the laws of the State of Nevada. Spectral is focused on the identification, acquisition, development, financing of technology that has the potential to transform existing industries. The Company looks for technology that can be protected through patents or laws regarding trade secrets.
In January 2022, the Company commenced a new line of business which is providing data and telecommunications reselling services on a global basis. On February 15, 2022, the Company entered into a telecommunications services agreement with Sky Data PLL OU (Estonia) to provide long distance switching services. The contract does not contain a fixed term or value and is on an as needed basis via invoice for Sky Data PLL OU.
Spectral intends to expand its reach within the telecommunications reselling services market and has identified the following steps in order to resume this line of business: ownership of infrastructure, control of data flow and the elimination of third parties. This progression will provide significant cost savings and allow the company direct access to the data in real time to optimize service and to gain the most traffic in high demand areas. These steps will also enable Spectral to provide better service with the hope to gain better contracts over time. In conjunction with its partner Sky, ownership of infrastructure is underway, and the companies are currently in talks to secure contracts with providers.
RESULTS OF OPERATIONS
Comparison of the nine months ended September 30, 2023 and 2022
Revenues
We are currently engaged in a technology development business and recently commenced operations within the telecom industry. Revenues decreased from $176,200 for the nine months ended September 30, 2022 to $0 for the nine months ended September 30, 2023. The decrease is due to the pause of our new business venture.
Cost of Revenues
We are currently engaged in a technology development business and recently commenced operations within the telecom industry. Cost of revenues decreased from ($234,060) for the nine months ended September 30, 2022 to $0 for the nine months ended September 30, 2023. The decrease is due to the pause of our new business venture.
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Operating Expenses
Operating expenses decreased $186,018, from $359,151 for the nine months ended September 30, 2022 to $173,133 for the nine months ended September 30, 2023. The significant decrease was due to the pause of our operations due to the forthcoming structural changes within our new line of business.
Liquidity and Capital Resources
As of September 30, 2023, we had $1,116 cash on hand. We intend to fund operations through the use of cash on hand, cash flows from operations and through debt and equity financings until sufficient cash flows from operations can be achieved.
Net cash used in operating, activities decreased $8,987, from $49,120 in cash used during the nine months ended September 30, 2022 to $40,133 cash used in the nine months ended September 30, 2023. This decrease was primarily related to the Company having temporary ceased operations.
Net cash provided by financing activities decreased by $19,353 from $49,930 for the nine months ended September 30, 2022 to $30,577 for the nine months ended September 30, 2023. Net cash provided by financing activities during the nine months ended September 30, 2023 and 2022 related to proceeds short-term advances and proceeds from the sale of common stock, respectively.
We believe that our current financial resources are not sufficient to meet our working capital requirements over the next year. Additional funding will be necessary in order to expand portfolio operations and to reach our goals. Currently, the Company does not have any commitments or assurances for additional capital nor can the Company provide assurance that such financing will be available to it on favourable terms, or at all. If, after utilizing the existing sources of capital available to the Company, further capital needs are identified and the Company is not successful in obtaining the financing, it may be forced to curtail its existing or planned future operations. In addition, if necessary, we will decrease expenses and redirect our efforts towards a sale of one of more of our assets should funding become inadequate.
Our short-term prospects are promising given our success to date in securing the two portfolio companies, Noot and Monitr as well as our entry into the telecommunications reselling business. However, we need significant capital to implement our plan.
Off Balance Sheet Arrangements
We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not required for a smaller reporting company.
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ITEM 4. CONTROLS AND PROCEDURES
(a) Evaluation of disclosure controls and procedures.
As required by Rule 13a-15 or Rule 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), our management, including our principal executive officer and principal accounting officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing evaluation, we have concluded that our disclosure controls and procedures were not effective as of September 30, 2023 and that they do not allow for information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission (“SEC”) rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the us in the reports that we file or submit under the Exchange Act is accumulated and communicated to the Company’s management, including its Chief Executive and Principal Accounting & Financial Officers as appropriate to allow timely decisions regarding required disclosure.
The material weaknesses were first identified in our annual report on Form 10-K for the year ended December 31, 2012 in which related to a lack of an accounting staff resulting in a lack of segregation of duties necessary for an effective system of internal control. The weakness in segregation of duties will continue to exist until such time as management can retain internal staff to properly segregate duties.
(b) Changes in internal control over financial reporting.
There were no changes in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Unregistered Sales of Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
Not Applicable.
Item 4. Mine Safety Disclosures.
None.
Item 5. Other Information
None.
Item 6. Exhibits
EXHIBITS
List of Exhibits |
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3(i)(1) |
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3(i)(2) |
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3(ii) |
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31.1 | Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
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31.2 |
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32.1 |
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32.2 |
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SIGNATURE
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.
| Spectral Capital Corporation |
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| /s/ Jenifer Osterwalder |
| Jenifer Osterwalder |
| President and Chief Executive Officer
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Dated: November 13, 2023
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