10-Q/A 1 ghdc1204201410qamarch.htm AMENDED MARCH 31, 2014 QTR REPORT-NOW INCLUDES XBRL TAGS

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


Form 10-Q/A

(Amendment No. 1 to Form 10-Q)

(Mark One)

x   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2014

or

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to __________

Commission file number 000-53505

GOLDLAND HOLDINGS CO.

(Exact name of small business issuer as specified in its charter)

DELAWARE

90-0350814

(State or other jurisdiction of incorporation or organization)

(IRS Employer Identification No.)

1001 3rd Ave., W.,  Suite #430,  Bradenton, Florida 34205

 (Address of principal executive offices)

(941) 761-7819

 (Issuer’s telephone number, including area code)

_______________________________________________________

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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.  x Yes [ ] 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 (§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).  x

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 [ ] 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

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: 109,729,839 shares as of May 14, 2014.


EXPLANATORY NOTE: The Company has included the XBRL Interactive Data Table 101 Exhibits with this amended filing.

 

 

 

2




GOLDLAND HOLDINGS CO.


FORM 10-Q REPORT INDEX


PART I.  FINANCIAL INFORMATION

3

Item 1.  Financial Statements

3

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations.

11

Item 3.  Quantitative and Qualitative Disclosures about Market Risk.

15

Item 4.  Controls and Procedures.

15

PART II.  OTHER INFORMATION.

16

Item 1.  Legal Proceedings.

16

Item 1A.  Risk Factors.

16

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

16

Item 3.  Defaults upon Senior Securities.

16

Item 4. Mine Safety Disclosures.

17

Item 5.  Other Information.

17

Item 6.  Exhibits.

17

SIGNATURES

18




2



PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

GOLDLAND HOLDINGS CO.

BALANCE SHEET

MARCH 31, 2014 AND DECEMBER 31, 2013

ASSETS

March 31,  2014

(unaudited)

 

December 31, 2013

(audited)

Cash and cash equivalents

$                    290

 

   $                 478

Prepaid expenses

30,623

 

34,998

Other assets

3,000

 

3,000

Total current assets

33,913

 

38,476

 
 

Gaming equipment, net

369,966

 

-

Mining Properties

360,000

 

360,000

 
 

Total Assets

$           763,879

 

$         398,476

 
 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 
 
 

Liabilities:

 

Accounts payable

$             110,375

 

$           106,316

Due to related parties

525,984

 

510,962

Accrued compensation

-

 

6,045,973

   Total current liabilities (all current)

636,359

 

6,663,251

 
 

      Notes payable   

-

 

3,000

         Total liabilities

636,359

 

6,666,251

 
 

Stockholders' deficit:

 

Preferred stock, 5,000,000 shares authorized

-

 

-

Common stock, par value $0.0001, 1,000,000,000 shares authorized, 107,567,223 and 39,828,881 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively

10,757

 

3,983

Additional paid in capital

19,502,337

 

12,201,959

Accumulated deficit

(19,385,574)

 

(18,473,717)

Total stockholders' deficit

127,520

 

(6,267,775)

 
 

Total Liabilities and Stockholders' Equity (Deficit)

$      763,879

 

$       398,476


See accompanying notes to financial statements




3



GOLDLAND HOLDINGS CO.

STATEMENT OF OPERATIONS

FOR THE THREE MONTHS ENDED MARCH 31, 2014 AND 2013

(UNAUDITED)


 

2014

 

2013

    

Revenues:

$                      -

$             250,000

 

Expenses:

Professional fees

471,652

46,330

Stock compensation expense

424,384

455,176

Depreciation expense

6,271

-

General and administrative

9,492

5,491

Total expenses

911,799

506,997

 

Loss from operations

(911,799)

(256,997)

 

Interest expense

(58)

-

 

Net Loss

$         (911,857)

$      (256,997)

 
 

Net loss per common share – basic and fully diluted

$              (0.02)

$                 (0.01)

 

Weighted average number of common shares outstanding – basic and fully diluted

56,797,246

39,449,292



See accompanying notes to financial statements




4



GOLDLAND HOLDINGS CO.

STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2014 AND 2013

(UNAUDITED)


 

2014

 

2013

Cash flows from operating activities:

   

Net income (loss)

$      (911,857)

 

$      (256,997)

Adjustments to reconcile net earnings (loss) to net cash (used in) operating activities:

   

Issuance of common stock for services

458,000

 

45,750

Issuance of common stock for compensation

6,469,857

 

1,526,704

Issuance of common stock for interest

58

 

-

Increase (decrease) in operating assets and liabilities:

   

Depreciation

6,271

 

-

Accounts payable and accrued expenses

4,059

 

581

Accrued compensation

(6,045,973)

 

-

Prepaid expenses

4,375

 

(1,361,153)

Due to related party

15,022

 

45,165

Net cash provided by (used in) operating activities

(188)

 

50

    

Net increase (decrease) in cash and cash equivalents

(188)

 

50

Cash and equivalents at beginning of period

478

 

-

Cash and equivalents at end of period

$                 290

 

$                  50

    

 

2014

2013

SUPPLEMENTARY DISCLOSURE OF NONCASH TRANSACTIONS

  
   

Shares issued for services

       $      458,000    

   $           45,750

Shares issued to repay note payable

         $          3,058

$                    -

Shares issued for purchase of gaming equipment

$      376,237

$                    -

Shares issued for compensation

$   6,469,857

 $      1,526,704

Non-cash lease income

$                 -

     $      (250 000)


See accompanying notes to financial statements.




5




GOLDLAND HOLDINGS CO.

STATEMENT OF STOCKHOLDERS' DEFICIT

FOR THE THREE MONTHS ENDED MARCH 31, 2014

(UNAUDITED)


 

Common Shares

Preferred Shares

Common Stock, At Par

Preferred Stock

Additional Paid in Capital

Accumulated Deficit

Total Shareholder's Deficit

        

Balance at 12/31/13

39,828,881

-

$        3,983

$                -

$   12,201,959

$    (18,473,717)

$  (6,267,775)

        

Shares issued for services

3,769,539

-

377

-

457,623

-

458,000

Shares issued for compensation

46,499,155

 

4,650

 

6,465,207

 

6,469,857

Shares issued for conversion of notes payable

19,113

 

2

 

3,056

 

3,058

Shares issued for purchase of gaming equipment

17,450,535

 

1,745

 

374,492

 

376,237

Net loss

-

-

-

-

-

(911,857)

(911,857)

Balance at 03/31/14

107,567,223

-

$        10,757

$                -

$   19,502,337

$    (19,385,574)

$      127,520


See accompanying notes to financial statements.

 


6



GOLDLAND HOLDINGS CO.

NOTES TO INTERIM FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2013 AND 2012

(UNAUDITED)


NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

GoldLand Holdings, CO, (the “Company,” “we” or “us”) was originally formed as Montrose Ventures, Inc. in the State of Delaware on May 25, 1989.  On April 23, 1996, the Company’s name was changed to Java Group, Inc., and on September 1, 2004 the name was changed to Consolidated General Corp.  On August 7, 2007, the company’s name was changed to GoldCorp Holdings Co.  On October 15, 2010, our name was changed to GoldLand Holdings Co.

The Company owns land and lease claims on War Eagle Mountain in the state of Idaho.  The Company has entered into a lease agreement with Silver Falcon Mining, Inc. (“Silver Falcon”) under which Silver Falcon is entitled to mine the land and the Company is entitled to a 15% net royalty on all minerals extracted by Silver Falcon from tailing piles on the premises or through shafts or adits located on the premises.

On September 19, 2013, our wholly-owned subsidiary entered into an asset purchase agreement to acquire certain gaming equipment from Universal Entertainment SAS, Ltd., a corporation formed under the laws of the Country of Colombia, for 17,450,535 shares of our common stock (post-split).  Closing was conditioned on our completion of a 1 for 10 reverse stock split, among other things.  The equipment includes approximately 67 video poker and slot machines; 8 blackjack and miscellaneous game tables and related furniture and equipment; roulette table and related furniture and equipment; bingo equipment and furniture; casino chips, bill acceptors, coin counter and related equipment; and miscellaneous office equipment, like chairs, tables, etc. We completed the reverse split in March 2014, and completed the purchase on March 6, 2014.  Upon closing of the acquisition, we simultaneously leased the equipment to VOMBLOM & POMARE S.A., a company formed under the laws of Colombia, which provides for lease payments of $700,000 per year, payable $58,333 per month, and a term of five years with one five year renewal option.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

Revenue is recognized when earned according to lease and royalty agreements.  Lease income is recognized as earned on a monthly basis according to the terms of the lease.  Royalty income is recognized as minerals are extracted and refined.

Cash and Cash Equivalents

Cash and cash equivalents consist of all cash balances and highly liquid investments with an original maturity of three months or less. Because of the short maturity of these investments, the carrying amounts approximate their fair value.

Facilities and equipment

Expenditures for new facilities or equipment and expenditures that extend the useful lives of existing facilities or equipment are capitalized and recorded at cost. The facilities and equipment are depreciated using the straight-line method at rates sufficient to depreciate such costs over the estimated productive lives, which do not exceed the related estimated mine lives, of such facilities based on proven and probable reserves.



7



Impairment of Long-Lived Assets

The Company reviews and evaluates its long-lived assets for impairment when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. An impairment is considered to exist if the total estimated future cash flows on an undiscounted basis are less than the carrying amount of the assets, including goodwill, if any.  An impairment loss is measured and recorded based on discounted estimated future cash flows. Future cash flows are estimated based on quantities of recoverable minerals, expected gold and other commodity prices (considering current and historical prices, price trends and related factors), production levels and operating costs of production and capital, all based on life-of-mine plans. Existing proven and probable reserves and value beyond proven and probable reserves, including mineralization other than proven and probable reserves and other material that is not part of the measured, indicated or inferred resource base, are included when determining the fair value of mine site reporting units at acquisition and, subsequently, in determining whether the assets are impaired. The term “recoverable minerals” refers to the estimated amount of gold or other commodities that will be obtained after taking into account losses during mineral processing and treatment. Estimates of recoverable minerals from such exploration stage mineral interests are risk adjusted based on management’s relative confidence in such materials. In estimating future cash flows, assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of future cash flows from other asset groups. The Company’s estimates of future cash flows are based on numerous assumptions and it is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold and other commodity prices, production levels and operating costs of production and capital are each subject to significant risks and uncertainties.

Goodwill

The Company evaluates, on at least an annual basis during the fourth quarter, the carrying amount of goodwill to determine whether current events and circumstances indicate that such carrying amount may no longer be recoverable. To accomplish this, the Company compares the estimated fair value of its reporting units to their carrying amounts. If the carrying value of a reporting unit exceeds its estimated fair value, the Company compares the implied fair value of the reporting unit’s goodwill to its carrying amount, and any excess of the carrying value over the fair value is charged to earnings. The Company’s fair value estimates are based on numerous assumptions and it is possible that actual fair value will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold and other commodity prices, production levels and operating costs of production and capital are each subject to significant risks and uncertainties.

Stock Based Compensation

The Company has issued and may issue stock in lieu of cash for certain transactions. The fair value of the stock, which is based on comparable cash purchases, third party quotations, or the value of services, whichever is more readily determinable, is used to value the transaction

Use of Estimates

The Company’s Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of the Company’s Financial Statements requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the Financial Statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances.



8



Accordingly, actual results may differ significantly from these estimates under different assumptions or conditions.

Basic and Diluted Per Common Share

Basic earnings  per common  share is computed by dividing income available to common stockholders by the weighted average number of common shares assumed to be outstanding during the period of computation. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Because we have incurred net losses, basic and diluted loss per share are the same since additional potential common shares would be anti-dilutive.

Research and Development

The Company expenses research and development costs as incurred.

NOTE 3 - RELATED PARTY TRANSACTIONS

As of March 31, 2014, the amount due to Silver Falcon was $324,472, the amount due to Diamond Creek Mill, Inc., a wholly-owned subsidiary of Silver Falcon, was $2,550, the amount due to Pierre Quilliam was $417, the amount due from Palmirs, Inc., a wholly-owned subsidiary of Silver Falcon, was $1,700, and the amount due to Bisell Investments, LLC was $200,145.  The amounts are non-interest bearing, unsecured demand loans.  

Silver Falcon is obligated to pay Goldland $83,333 per month as rent under a mining lease.  Instead of paying the rent in cash, Silver Falcon has, since January 1, 2012, issued shares of its common stock to pay compensation expenses of our officers and independent contractors.

In connection with the Equipment Acquisition (see Note 8), we issued 17,000,000 shares of common stock to various officers, directors and significant shareholders as a bonus for past services and support of the Company and as consideration for future services and support.  The shares were valued at $0.15 per share, which was the market value of the shares on the date of issuance.  Set forth below are the number of shares and the value of the shares issued to each recipient.

Shareholder

No. of Shares

Estimated Value

Paul Parliament

500,000

$        75,000

Lewis Georges

500,000

 75,000

Christian Quilliam

5,000,000

750,000

New Vision Financial, Ltd.

2,000,000

300,000

Allan Breitkreuz

3,000,000

450,000

Bisell Investments, Inc.

2,000,000

300,000

Denise Quilliam

4,000,000

600,000

   

Total

17,000,000

$    3,150,000

   

In connection with the Equipment Acquisition, the Company entered into agreements to cancel any outstanding options held by its officers and directors in consideration for $100 payable to each optionholder.  Set forth below are the options that were cancelled:

Pierre Quilliam

1,800,000

Denise Quilliam

1,325,000



9



Christian Quilliam

1,700000

Thomas C. Ridenour

1,700000

Allan Breitkreuz

1,700000

Pascale Tutt

375,000

Total

8,600,000

  

In connection with the Equipment Acquisition, the Company entered into employment or consulting agreements with certain officers, which included certain bonus shares issued to the officer.  Set forth below is a summary of the key terms of the employment or consulting agreements and the bonus shares issued to each thereunder:

Consultant

Compensation

Term

Bonus Shares

Value of Bonus Shares

     

Pascale Quilliam

$150,000/year

5 years

500,000

75,000

Pierre Quilliam

$250,000/year

5 years

-

-

Thomas C. Ridenour

$185,000/year

5 years

3,000,000

450,000

Q-Prompt, Inc.

None

5 years

1,000,000

150,000

     

Total:

  

4,500,000

$   675,000

     

NOTE 4 - COMMITMENTS AND CONTINGENCIES

In August 2010, Richard (Robert) Corrigan, acting as a debtor in possession in his personal bankruptcy case, filed an adversary proceeding against us to recover amounts due under a consulting agreement dated July 1, 2009.  The consulting agreement provided that Mr. Corrigan would provide certain consulting, mapping and assaying services on three lode claims owned by us on War Eagle Mountain. The consulting agreement provided that Mr. Corrigan’s compensation would be a bonus of $150,000, which would be payable in the form of 150,000 shares of common stock, and monthly consulting payments of $5,000 per month.  The consulting agreement also provided that Mr. Corrigan was entitled to monthly transportation expenses of $250 per month. We terminated Mr. Corrigan on December 8, 2009 for nonperformance.  In 2011, Mr. Corrigan’s case was converted to a Chapter 7 case. In November 2011, Mr. Corrigan’s bankruptcy trustee filed an amended complaint in the adversary proceeding, in which Chapter 7 trustee seeks recovery of the $150,000 bonus and the balance of the unpaid consulting fees and travel expense allowance of $60,900, for a total of $210,900, plus interest and attorney’s fees.

On June 19, 2013, the Company learned that the District Court for the Third Judicial District of the State of Idaho for the County of Owyhee entered a default judgment against the Company in the case. The default judgment grants a judgment against the Company in the amount of $284,449.  The Company retained new counsel who filed a motion to vacate the default judgment.  On September 19, 2013, the court entered a memorandum opinion setting aside the default judgment.  As a result, the Company plans to continue defending the action vigorously.

NOTE 5 – REVERSE STOCK SPLIT

On March 6, 2014, the Company amended it Certificate of Incorporation to increase its authorized capital stock to 1,000,000,000 shares of Common Stock, par value $0.0001 per share.  In addition, the Company amended it Certificate of Incorporation to effect a reverse split of its common stock at a ratio of one share for each ten shares.  All share amounts have been restated to reflect the stock split.

NOTE 6 - CAPITAL STOCK



10



At March 31, 2014, the Company's authorized capital stock was 1,000,000,000 shares of Common Stock, par value $0.0001 per share, and 5,000,000 shares of Preferred Stock, par value $0.0001 per share.  On that date, the Company had outstanding 107,567,223 shares of Common Stock, and no shares of Preferred Stock.

During the three months ended March 31, 2014, we issued shares of in the following transactions:

·

3,769,539 shares of Common Stock valued at $458,000 for services.

·

46,499,155 shares of Common Stock valued at $6,469,857 were issued in payment of various compensation agreements of accrued compensation of $6,045,973 at December 31, 2013, and compensation during the period of $424,384.

·

17,450,535 shares of Common Stock valued at $3,490,107 were issued for the acquisition of gaming equipment and the related licenses.

·

19,113 shares of Common Stock were issued upon conversion of notes payable with an aggregate principal amount of $3,000.

NOTE 7 – GOING CONCERN

These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.  However, the Company has incurred a net loss of ($911,857) for the three months ended March 31, 2014.  The Company has remained in business primarily through the deferral of salaries by management, loans from the Company’s chief executive officer, loans from a significant shareholder, and the issuance of shares of common stock to procure certain services. The Company intends on financing its future development activities from the same sources, until such time that funds provided by operations are sufficient to fund working capital requirements.

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time.

NOTE 8 – ACQUISITION OF CASINO EQUIPMENT AND RELATED TRANSACTIONS

On September 19, 2013, the Company (through its wholly-owned subsidiary, Universal Entertainment SAS, Inc.) entered into an Asset Purchase Agreement with Universal Entertainment SAS, Ltd., a corporation formed under the laws of the Country of Colombia, to acquire certain casino equipment (the “Equipment”)(such transaction hereinafter referred to as the “Equipment Acquisition”).  The Equipment Acquisition closed in March 2014, at which time the following transactions took place:

·

The Company effected a one for ten reverse stock split.

·

The Company issued 17,450,535 shares of Common Stock to acquire the Equipment.

·

The Company entered into a lease (the “Lease”) of the Equipment to VOMBLOM & POMARE S.A., a company formed under the laws of Colombia, which provides for lease payments of $700,000 per year, payable $58,333 per month, and a term of five years with one five year renewal option.  



11



·

The Company entered into consulting agreements with two shareholders of the seller, which provide for aggregate annual compensation of $370,000 per year payable in restricted shares of the Company’s common stock, and have a term of five years.

·

The Company entered into certain employment or consulting agreements which will obligate the Company to make total payments of $1,235,000 per year for five years, which payments will be made in shares of the Company’s Common Stock at its market price at the time of issuance.  .

·

The Company issued 19,977,980 shares of the Company’s Common Stock to certain officers, directors, and consultants, as well as the two principals of Universal Entertainment SAS, Ltd., as bonuses under consulting agreements or employment agreements with such persons.   

·

The Company issued 17,000,000 shares of the Company’s Common Stock to certain officers, directors and significant shareholders.

·

The Company cancelled 8,600,000 options held by certain officers and directors of the Company.

NOTE 9 – SUBSEQUENT EVENTS

None.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Disclosure Regarding Forward Looking Statements

This Quarterly Report on Form 10-Q includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (“Forward Looking Statements”). All statements other than statements of historical fact included in this report are Forward Looking Statements. In the normal course of its business, the Company, in an effort to help keep its shareholders and the public informed about the Company’s operations, may from time-to-time issue certain statements, either in writing or orally, that contain or may contain Forward-Looking Statements. Although the Company believes that the expectations reflected in such Forward Looking Statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Generally, these statements relate to business plans or strategies, projected or anticipated benefits or other consequences of such plans or strategies, past and possible future, of acquisitions and projected or anticipated benefits from acquisitions made by or to be made by the Company, or projections involving anticipated revenues, earnings, levels of capital expenditures or other aspects of operating results. All phases of the Company operations are subject to a number of uncertainties, risks and other influences, many of which are outside the control of the Company and any one of which, or a combination of which, could materially affect the results of the Company’s proposed operations and whether Forward Looking Statements made by the Company ultimately prove to be accurate. Such important factors (“Important Factors”) and other factors could cause actual results to differ materially from the Company’s expectations are disclosed in this report. All prior and subsequent written and oral Forward Looking Statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the Important Factors described below that could cause actual results to differ materially from the Company’s expectations as set forth in any Forward Looking Statement made by or on behalf of the Company.



12



Overview

We were originally formed as Montrose Ventures, Inc. in the State of Delaware on May 25, 1989.  On April 23, 1996, our name was changed to Java Group, Inc., which tried and failed to start a chain of coffee bars.  On September 1, 2004 our name was changed to Consolidated General Corp., which tried to buy tier 2 and 3 professional sports teams, including the Vancouver Ravens lacrosse team and the San Diego Soccer team.  On August 7, 2007, our Certificate of Incorporation was amended and restated, pursuant to which our name was changed to Goldcorp Holdings Co.  On October 15, 2010, our name was changed to GoldLand Holdings Co.  We are currently engaged in two lines of business:  mining properties, and gaming equipment leases.

Mining Properties:  On September 14, 2007, we acquired an interest in 174.82 acres of land on War Eagle Mountain in Idaho from two of our major shareholders for a total of 90,000,000 shares of our common stock.  We acquired a 100% interest in 103 acres, and a 29.166% interest in 76.63 acres.  We also leased five placer claims on War Eagle Mountain from the U.S. Bureau of Land Management, each of which covered approximately 20 acres, or approximately 100 acres in total. Subsequently, as a result of a survey we allowed our original claims to lapse, and reapplied for new lode claims that are better oriented in the direction of the three veins in the mountain. As a result, we now own 14 unpatented lode claims covering 262.85 acres.

On October 11, 2007, we leased the mining operations on our properties and claims to Silver Falcon Mining, Inc.  Under the lease, Silver Falcon is responsible for all mining activities on the land, and it is obligated to make annual lease payments of $1,000,000 per year payable monthly, a nonaccountable expense allowance of $10,000 per month for any month in which ore is mined from the property, and a net royalty of 15% from any proceeds we receive from a refiner of ore produced from tailing piles on the premises or through shafts or adits located on the premises.  The lease, as most recently amended, provides for a deferral of lease payments for two years beginning on January 1, 2014.  The lease, as most recently amended, expires on October 1, 2028, although Silver Falcon has the right to extend the lease for an additional five years upon payment of a lease extension fee of $1,000,000. Pierre Quilliam, our chairman and chief executive officer, is also the chairman and chief executive officer of Silver Falcon.  

Since Silver Falcon leased our properties, it has expended substantial funds to develop mining operations and improve the property.  In 2009 and 2010, it constructed a milling facility on land it purchased at the base of the mountain, and began processing tailings at the mill in May 2010.  In 2011, it began construction of a metallurgical assay lab at the same site to process concentrate produced in its milling operation, which it expects to complete in mid-2015.  It also plans to begin construction of a closed circuit cyanide leaching and a bullion Dore production facility on its mill site in the fall of 2014, in order to improve the yields from the tailings that it processes, and to service some proposed tolling contracts.

In 2010, Silver Falcon upgraded the roads to the Sinker Tunnel Complex to allow 25-ton trucks access to the site, and an area of approximately 300x400 feet was prepared and secured, to act as a staging area at the 5,200 foot level. The Sinker Tunnel was aerated in its entire length and the entrance to the Sinker Tunnel was permanently extended and secured to avoid land or snow slides to block access to the Sinker Tunnel. Permanent drainage pipes have been laid in the Sinker Tunnel as it was determined that the Sinker Tunnel is the main drain for the War Eagle complex. Mining and shoring or rock bolting of some weak points in the top wall is underway. Permitting for exploration of the Sinker Tunnel is underway with training for underground personnel and safety measures being installed per the latest mining rules and regulations.

We agreed to a two year deferral of lease payments from Silver Falcon because Silver Falcon is unable to make lease payments while it undergoes a recapitalization.  In particular, it needs to raise capital to complete its metallurgical lab and build a leaching facility to improve operations at its mill.  It also needs to raise capital to pay a number of delinquent liabilities, some of which have placed liens against its mill, including the State of Idaho, the Internal Revenue Service, and several trade creditors who have obtained judgments against it.



13


 

Gaming Equipment: On September 19, 2013, Universal Equipment SAS, Inc., our wholly-owned subsidiary, entered into an asset purchase agreement to acquire certain gaming equipment from Universal Entertainment SAS, a corporation formed under the laws of the Country of Colombia, for 17,450,535 shares of our common stock (post-split).  Closing occurred on March 6, 2014. The equipment includes approximately 67 video poker and slot machines; 8 blackjack and miscellaneous game tables and related furniture and equipment; roulette table and related furniture and equipment; bingo equipment and furniture; casino chips, bill acceptors, coin counter and related equipment; and miscellaneous office equipment, like chairs, tables, etc.  Upon closing of the acquisition, we simultaneously leased the equipment to VOMBLOM & POMARE S.A., a company formed under the laws of Colombia, which provides for lease payments of $700,000 per year, payable $58,333 per month, and a term of five years with one five year renewal option. The Equipment is used primarily in the operation of a casino that is owned and operated by the lessee on Isla San Andres, Colombia. However, some of the equipment, such as video poker and slot machines, may be placed in retail locations under agreements with the retail merchant to divide winnings from the machines.

 Results of Operations

Three Months ended March 31, 2014 and 2013

We reported revenues of $0 and $250,000 during the three months ended March 31, 2014 and 2013, respectively. All of our revenues for 2013 constitute base rental payments under our lease with Silver Falcon.  The lease has been deferred for a period of two years, effective January 1, 2014, because of Silver Falcon’s need to recapitalize its operations.

We reported losses from operations during the three months ended March 31, 2014 and 2013 of ($911,799) and ($256,997), respectively.  The increased operating loss in 2014 as compared to 2013 was largely attributable to an increase in consulting fees of $425,322 related to consulting agreements that we entered into in connection with our gaming business and properties in South America, offset by a decrease in stock compensation of $30,792.  

We reported a net loss during the three months ended March 31, 2014 and 2013 of ($911,857) and ($256,997), respectively.  

Liquidity and Sources of Capital

The following table sets forth the major sources and uses of cash for the three months ended March 31, 2014 and 2013:

 

Nine months ended September 30,

 

2014

 

2013

Net cash provided by (used) in operating activities

$     (188)

 

$          50

Net cash provided by (used) in investing activities

-

 

-

Net cash provided by (used) in financing activities

-

 

-

Net (decrease) increase in unrestricted cash and cash equivalents

$     (188)

 

$          50

    

Comparison of 2014 and 2013



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Operating activities (used) contributed ($188) of cash in 2014, as compared to a contribution of $50 of cash in 2013.  Major non-cash items that affected our cash flow from operations in 2014 were increases in stock issued for services of $458,000 and stock issued for compensation of $6,469,857, offset by a decrease in accrued compensation of ($6,045,973).

Major non-cash items that affected our cash flow from operations in 2013 were a decrease in prepaid expenses of ($1,361,153) offset by an increase in stock issued for compensation of $1,526,704.

There were no investing or financing activities in either 2014 or 2013 other than loans made by related parties as listed above.

Current Liquidity

Our balance sheet as of March 31, 2014 reflects cash and current assets of $33,913, current liabilities of $636,359, and a working capital deficit of ($602,446).  However, most of our current liabilities consist of balances due to related parties, and most of our current assets consist of prepaid compensation paid to our officers which is capitalized as a prepaid expense.

We have executed a lease agreement with Silver Falcon, which provides for an annual lease payment of $1,000,000 payable in monthly installments, and a royalty equal to 15% of the proceeds of any ore produced from tailing piles or through shafts or adits located on our property on War Eagle Mountain. Effective January 1, 2014, we agreed to allow Silver Falcon to defer lease payments for a period of two years to allow Silver Falcon time to recapitalize itself.    

As a result of the deferral of rent payments under our lease with Silver Falcon, our sole source of revenue is our lease of casino equipment in South America.  However, our casino equipment lease payments are not sufficient to pay our full contractual commitments for salaries and consulting payments, as well as other operating expenses.  As a result, we are dependent on the issuance of shares of our common stock for services, and loans from our officers and other shareholders, to pay our administrative expenses.

Critical Accounting Policies and Estimates

Our significant accounting policies are described in Note 2 of Notes to Financial Statements. At this time, we are not required to make any material estimates and assumptions that affect the reported amounts and related disclosures of assets, liabilities, revenue, and expenses. However, as we begin actual mining operations, we may be required to make estimates and assumptions typical of other companies in the mining business.

For example, we will be required to make critical accounting estimates related to future metals prices, obligations for environmental, reclamation, and closure matters, mineral reserves, and accounting for business combinations.  The estimates will require us to rely upon assumptions that were highly uncertain at the time the accounting estimates are made, and changes in them are reasonably likely to occur from period to period.  Changes in estimates used in these and other items could have a material impact on our financial statements in the future.

We may have to make estimates of future earnings from our leasing of gaming equipment as expansion and future acquisitions will impact  revenue in that sector of our business.

Our estimates will be based on our experience and our interpretation of economic, political, regulatory, and other factors that affect our business prospects. Actual results may differ significantly from our estimates.



15



Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that 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 are material to investors.

Going Concern

The Company's financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.  However, the Company has incurred a net loss of ($911,857) for the three months ended March 31, 2014.  The Company has remained in business primarily through the deferral of salaries by management, loans from the Company’s chief executive officer, loans from a significant shareholder and the issuance of shares of common stock to procure certain services. The Company intends on financing its future development activities from the same sources, until such time that funds provided by operations are sufficient to fund working capital requirements.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Because the Company is a smaller reporting company, it is not required to provide the information called for by this Item.

ITEM 4.  CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Pierre Quilliam, our chief executive officer, and Thomas C. Ridenour, our chief financial officer, are responsible for establishing and maintaining our disclosure controls and procedures.  Disclosure controls and procedures means controls and other procedures that are designed to ensure that information we are required to disclose in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and to ensure that information required to be disclosed by us in those reports is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  Our chief executive officer and chief financial officer evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of March 31, 2014.  Based on that evaluation, our chief executive officer and chief financial officer have concluded that, as of the evaluation date, such controls and procedures were effective.

Changes in internal controls

There were no changes in our internal controls over financial reporting that occurred during the quarter ended March 31, 2014 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.

In August 2010, Richard Corrigan, acting as a debtor in possession in his personal bankruptcy case, filed an adversary proceeding against the Company to recover amounts due under a consulting agreement dated July 1, 2009.  The consulting agreement provided that Mr. Corrigan would provide certain consulting, mapping and assaying services on three lode claims owned by the Company on War Eagle Mountain.  The consulting agreement provided that Mr. Corrigan’s compensation would be a bonus of $150,000, which would be payable in the form of 150,000 shares of common stock, and monthly consulting payments of $5,000 per month.  The consulting agreement also provided that Mr. Corrigan was entitled to monthly transportation expenses of $250 per month. The Company terminated Mr. Corrigan on December 8, 2009 for nonperformance.  In 2011, Mr. Corrigan’s case was converted to a Chapter 7 case. In November 2011, Mr. Corrigan’s bankruptcy trustee filed an amended complaint in the adversary proceeding, in which Chapter 7 trustee seeks recovery of the $150,000 bonus and the balance of the unpaid consulting fees and travel expense allowance of $60,900, for a total of $210,900, plus interest and attorney’s fees.

On June 19, 2013, the Company learned that the District Court for the Third Judicial District of the State of Idaho for the County of Owyhee entered a default judgment against the Company in the case. The default judgment grants a judgment against the Company in the amount of $284,449.  The Company retained new counsel who filed a motion to vacate the default judgment.  On September 19, 2013, the court entered a memorandum opinion setting aside the default judgment.  As a result, the Company plans to continue defending the action vigorously.

ITEM 1A. RISK FACTORS.

Not applicable.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

During the three months ended March 31, 2014, we issued shares of in the following transactions:

·

3,577,010 shares of Common Stock valued at $430,500 for services.

·

46,499,155 shares of Common Stock valued at $6,469,857 were issued in payment of various compensation agreements.

·

17,450,535 shares of Common Stock valued at $3,490,107 were issued for the acquisition of gaming equipment and the related licenses.

·

19,113 shares of Common Stock were issued upon conversion of notes payable with an aggregate principal amount of $3,000.

ITEM 3.  DEFAULTS IN SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

None.


17



ITEM 5.  OTHER INFORMATION.

None.

ITEM 6.  EXHIBITS.

TR>

31.1

Amended Certification Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934

31.2

Amended Certification Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934

32.1

Amended Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2

Amended Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

EX-101.INS

XBRL Instance Document

EX-101.SCH

XBRL Taxonomy Extension Schema

EX-101.CAL

XBRL Taxonomy Extension Calculation Linkbase

EX-101.DEF

XBRL Taxonomy Extension Definition Linkbase

EX-101.LAB

XBRL Taxonomy Extension Label Linkbase

EX-101.PRE

XBRL Taxonomy Extension Presentation Linkbase



18



SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this amended report to be signed on its behalf by the undersigned, thereunto duly authorized.

  

 

GOLDLAND HOLDINGS CO.

 

 

Date: December 4, 2014


/s/ Pierre Quilliam

 

By: Pierre Quilliam, Chief Executive Officer

(principal executive officer)

  

 

 

Date: December 4, 2014


/s/ Thomas C. Ridenour

 

By: Thomas C. Ridenour, Chief Financial Officer

(principal financial and accounting officer)





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