U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934.
For the quarterly period ended: March 31, 2020
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from: ________ to _________
333-90031
Commission file number
Northstar Electronics, Inc.
Exact name of small business issuer as specified in its charter
Delaware | 33-0803434 |
State or other jurisdiction of organization | IRS Employee incorporation or Identification No. |
2020 General Booth Blvd, Unit 230,
Virginia Beach, VA, USA 23454
Address of principal executive offices
(780) 660 0937
Issuer's telephone number
Former name, former address and former fiscal year, 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 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 is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated Filer [ ] | Accelerated Filer [ ] |
Non-accelerated filer [X] | Smaller reporting Company [X] |
(Do not check if a smaller reporting company) | Emerging growth company [ ] |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)
[ ]Yes [X] No
Applicable only to issuers involved in bankruptcy proceedings during the preceding five years:
Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.
Yes[ ] No [ ] Not Applicable
Applicable only to corporate issuers:
State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date.
Common shares as of September 30, 2020: 127,838,231
Transitional Small Business Disclosure Format (check one):
Yes [ ] No [X]
2
TABLE OF CONTENTS
3
PART I - FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
NORTHSTAR ELECTRONICS, INC.
Interim Consolidated Balance Sheets
U.S. Dollars
| March 31 2020 |
| December 31 2019 | ||
| unaudited |
| audited | ||
Assets |
|
|
|
|
|
|
|
|
|
|
|
Current |
|
|
|
|
|
Cash | $ | 33,204 |
| $ | 40,261 |
Total assets | $ | 33,204 |
| $ | 40,261 |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
Current |
|
|
|
|
|
Accounts payable and accrued liabilities | $ | 1,235,792 |
| $ | 1,220,792 |
Loans payable |
| 442,916 |
|
| 442,916 |
Due to director |
| 614,928 |
|
| 616,159 |
Legal liability |
| 2,861,441 |
|
| 3,100,221 |
Total liabilities |
| 5,155,077 |
|
| 5,380,088 |
|
|
|
|
|
|
Stockholders Deficit |
|
|
|
|
|
Authorized: |
|
|
|
|
|
200,000,000 Common shares with a par value of $0.0001 each |
|
|
|
|
|
20,000,000 Preferred shares with a par value of $0.0001 each |
|
|
|
|
|
Issued and outstanding: |
|
|
|
|
|
127,838,231 Common shares (127,838,231 - December 31, 2019) |
| 12,784 |
|
| 12,784 |
597,716 Preferred series A, B and C shares (597,716 - December 31, 2019) |
| 404,299 |
|
| 404,299 |
Additional paid-in capital |
| 8,608,875 |
|
| 8,608,875 |
Accumulated deficit |
| (14,147,831) |
|
| (14,365,785) |
Total stockholders deficit |
| (5,121,873) |
|
| (5,339,827) |
Total liabilities and stockholders deficit | $ | 33,204 |
| $ | 40,261 |
Nature of operations and going concern (note 1)
Subsequent event (note 5)
See notes to the interim consolidated financial statements
4
NORTHSTAR ELECTRONICS, INC.
Interim Consolidated Statements of Operations
Three Months Ended March 31
Unaudited
U.S. Dollars
| 2020 |
| 2019 | ||
|
|
|
|
|
|
EXPENSES |
|
|
|
|
|
Administration | $ | 15,000 |
| $ | 15,750 |
Professional fees |
| 2,126 |
|
| 13,298 |
Management fees |
| - |
|
| 30,000 |
Engineering |
| - |
|
| 11,250 |
Rent |
| 2,250 |
|
| 2,658 |
Investor relations |
| - |
|
| 3,375 |
Office |
| 1,910 |
|
| 1,918 |
Foreign exchange (gain) loss |
| (263,484) |
|
| 57,887 |
Interest |
| 24,244 |
|
| 24,165 |
Total expenses |
| (217,954) |
|
| 160,301 |
|
|
|
|
|
|
Net income (loss) for the period | $ | 217,954 |
| $ | (160,301) |
|
|
|
|
|
|
Basic and diluted gain (loss) per common share | $ | 0.00 |
| $ | (0.00) |
|
|
|
|
|
|
Weighted average number of shares outstanding |
| 127,838,231 |
|
| 127,838,231 |
See notes to the condensed consolidated financial statements
5
NORTHSTAR ELECTRONICS, INC.
Interim Consolidated Statement of Changes in Stockholders Deficit
Three Months Ended March 31, 2020
Unaudited
U.S. Dollars
| Number of Shares |
| Par Value |
| Additional Paid-In Capital |
| Accumulated Deficit |
| Preferred Shares |
| Total Stockholders Deficit |
|
|
|
|
|
|
|
|
|
|
|
|
Balance December 31, 2019 | 127,838,231 |
| $ 12,784 |
| $ 8,608,875 |
| $ (14,365,785) |
| $ 404,299 |
| $ (5,339,827) |
Net income (loss) | - |
| - |
| - |
| (217,954) |
| - |
| (217,954) |
Balance March 31, 2020 | 127,838,231 |
| $ 12,784 |
| $ 8,608,875 |
| $ (14,147,831) |
| $ 404,299 |
| $ (5,121,873) |
See notes to the condensed consolidated financial statements
6
NORTHSTAR ELECTRONICS, INC.
Interim Consolidated Statements of Cash Flows
Three Months Ended March 31
Unaudited
U.S. Dollars
| 2020 |
| 2019 | ||
|
|
|
|
|
|
Operating Activities |
|
|
|
|
|
Net income (loss) | $ | 217,954 |
| $ | (160,301) |
Items not involving cash |
|
|
|
|
|
Foreign exchange (gain) loss |
| (263,024) |
|
| 34,218 |
Accrued interest |
| 24,244 |
|
| 24,165 |
Changes in non-cash working capital |
|
|
|
|
|
Changes in operating assets and liabilities |
| 13,769 |
|
| 72,133 |
Net cash used in operating activities |
| (7,057) |
|
| (29,785) |
|
|
|
|
|
|
Decrease in cash |
| (7,057) |
|
| (29,785) |
Cash, beginning |
| 40,261 |
|
| 170,831 |
|
|
|
|
|
|
Cash, ending | $ | 33,204 |
| $ | 141,046 |
See notes to the condensed consolidated financial statements
7
NORTHSTAR ELECTRONICS, INC.
Notes to Condensed Consolidated Financial Statements
March 31, 2020
Unaudited
U.S. Dollars
1. NATURE OF OPERATIONS AND ABILITY TO CONTINUE AS A GOING CONCERN
Northstar Electronics, Inc. (the Company) was incorporated on May 11, 1998 in the state of Delaware. The Company is doing research and development on single engine aircrafts for business use.
Northstar Electronics, Inc. (the Company) was incorporated on May 11, 1998 in the state of Delaware. The Company is doing research and development on single engine aircrafts for business use.
The Company's business activities are conducted in Canada. However, the financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) with all figures translated into United States dollars for financial reporting purposes.
These unaudited consolidated interim financial statements have been prepared by management in accordance with GAAP for interim financial information, are condensed and do not include all disclosures required for annual financial statements. The organization and business of the Company, accounting policies followed by the Company and other information are contained in the notes to the Companys audited consolidated financial statements filed as part of the Companys December 31, 2019 Form 10-K.
The Company is in the process of regenerating its operations. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the entire fiscal year. The accompanying interim consolidated financial statements have been prepared assuming the Company will continue as a going concern which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. During the three months to March 31, 2020 the Company incurred a net cash outflow of $7,057 and at March 31, 2020 had a working capital deficiency of $5,121,873.
Management has undertaken initiatives for the Company to continue as a going concern; for example: the Company is attempting to secure an equity financing in the short term. Management is unable to predict the results of its initiatives at this time.
Should management be unsuccessful in its initiative to finance its operations, the Companys ability to continue as a going concern is not certain. These financial statements do not give effect to any adjustments to the amounts and classifications of assets and liabilities which might be necessary should the Company be unable to continue its operations as a going concern.
2. RELATED PARTY TRANSACTIONS
a)The amount of $614,928 (December 31, 2019 - $616,159) due to a director of the Company has no specific terms of repayment, is non-interest bearing and unsecured.
b)The Company accrued management fees of $nil in total to a director of the Company for his services as an officer of the Company during the three months ended March 31, 2020 (2019: $30,000).
8
3. CONTINGENCIES
During 2000 to 2008, the Companys former subsidiaries Northstar Technical Inc. (NTI) and Northstar Network Ltd. (NNL) received funding from Atlantic Canada Opportunities Agency (ACOA) to fund their projects. In 2013, ACOA filed claims against NTI, NNL and the Company for repayments of advances due to events of default. The advance and interests ACOA claims totaled CAD$3,079,475. In accordance with agreements signed between NTI, NNL and the Company, the Company was jointly and severally liable for the obligations. Further, the claim amount bears a daily interest of CAD$358 from February 15, 2013 to settlement. During the three months ended March 31, 2020, the Company recorded interest expenses of $24,244 (2019: $24,165).
4. NEW ACCOUNTING PRONOUNCEMENTS
Management does not believe that any recently issued but not yet effective accounting pronouncements if currently adopted would have a material effect on the accompanying consolidated financial statements.
5. SUBSEQUENT EVENT
In April 2020, 1,495,000 warrants expired unexercised.
In September 2020, another 13,134,208 warrants expired unexercised.
9
Item 2. Management's Discussion and Analysis or Plan of Operation.
The following discussion should be read in conjunction with the accompanying unaudited consolidated financial information for the three month periods ended March 31, 2020 and March 31, 2019 prepared by management and the consolidated financial statements for the year ended December 31, 2019 as presented in its annual Form 10K as filed.
Special Note Regarding Forward Looking Statements
Certain statements in this report and elsewhere (such as in other filings by the Company with the Securities and Exchange Commission ("SEC"), press releases, presentations by the Company of its management and oral statements) may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," and "should," and variations of these words and similar expressions, are intended to identify these forward-looking statements. Actual results may materially differ from any forward-looking statements. Factors that might cause or contribute to such differences include, among others, competitive pressures and constantly changing technology and market acceptance of the Company's products and services. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
The Companys Services
We intend to build our own systems in the civilian aviation sector. The Company is working on plans to obtain world rights to a single engine turbo prop airplane with industrial applications. If successful, we intend to market the airplane internationally and provide Maintenance, Repair and Overhaul (MRO) services in close proximity to customers. The Companys wholly owned subsidiary, National Five Holding Ltd, is a 95% shareholder of Northstar Sealand Enterprises Ltd (NSEL). The constituent parts of NSEL has experience in working on certified commercial aircraft and government military contracts, and has access to an established aircraft parts manufacturing and assembly facility.
Results of Operations
Comparison of the three months ended March 31, 2020 with the three months ended March 31, 2019.
The net income for the three-month period ended March 31, 2020, was $217,954 compared to a net loss of $160,301 for the three months ended March 31, 2019. The increase in net operating result was in part due to foreign exchange fluctuations.
Comparison of Financial Position at March 31, 2020 with March 31, 2019
The Companys working capital deficiency at March 31, 2020 was $5,121,873, with current liabilities of $5,155,077, which are in excess of current assets of $33,204. At December 31, 2019 the Company had a working capital deficiency of $5,339,827.
Critical Accounting Policies and Estimates
We have adopted various accounting policies that govern the application of accounting principles generally accepted in the United States of America in the preparation of our financial statements. Our significant accounting policies are described in the footnotes to our annual financial statements at December 31, 2019. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.
10
Although these estimates are based on our knowledge of current events and actions it may undertake in the future, they may ultimately differ from actual results. Certain accounting policies involve significant judgments and assumptions by us and have a material impact on our financial condition and results. Management believes its critical accounting policies reflect its most significant estimates and assumptions used in the presentation of our financial statements. Our critical accounting policies include revenue recognition, accounting for stock based compensation and the evaluation of the recoverability of long-lived and intangible assets. We do not have off-balance sheet arrangements, financings or other relationships with unconsolidated entities or other persons, also known as special purpose entities.
Liquidity and Capital Resources
Cash outflow for the first quarter ended March 31, 2020 was $7,057 compared to an outflow of cash of $29,785 in the comparative prior quarter March 31, 2019. In the quarter, the Company received $0 ($0 in the comparative prior quarter) from equity funding and received $0 (received $0 in the comparative quarter) long term debt leaving cash on hand at March 31, 2020 of $33,204 compared to cash on hand of $40,261 at December 31, 2019. Until the Company receives revenues from new contracts it will be dependent upon equity and loan financings to compensate for the outflow of cash anticipated from operations.
At this time, no commitment for funding has been made to the Company.
The Companys continued operations are dependent upon obtaining revenues from outside sources or raising additional funds through debt or equity financing.
Item 3. Controls and Procedures
(a) Evaluation of disclosure controls and procedures
Based on the evaluation of the Company's disclosure controls and procedures (as defined in Rules 13a-14(c) and 15d-14(c) under the Securities Exchange Act of 1934) as of the date of this Quarterly Report on Form 10-Q, our chief executive officer and chief financial officer has concluded that our disclosure controls and procedures are designed to ensure that the information we are required to disclose in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and are operating in an effective manner. The disclosure controls were not effective at March 31, 2020.
(b) Changes in internal controls
There were no changes in our internal controls or in other factors that could affect these controls subsequent to the date of their most recent evaluation.
11
No change since previous filing.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
No change since previous filing.
Item 4. Submission of Matters to a Vote of Security Holders.
No change since previous filing.
No change since previous filing.
No change since previous filing.
12
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.
October 12, 2020 | Northstar Electronics, Inc. |
| (Registrant) |
|
|
| By: /s/ Wilson Russell |
| Wilson Russell, PhD, President and Chief Financial Officer |
13
EXHIBIT 31
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
UNDER
SECTION 302 OF THE SARBANES-OXLEY ACT
I, Wilson Russell certify that:
1. I have reviewed this Quarterly Report on Form 10-Q of Northstar Electronics, Inc. for the quarter ended March 31, 2020;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants Board of Directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
Date: October 12, 2020 |
| /s/ Wilson Russell |
|
| Wilson Russell, |
|
| Chief Executive Officer and Chief Financial Officer |
EXHIBIT 32
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with this Quarterly Report of Northstar Electronics, Inc. (the Registrant) on Form 10-Q for the quarter ended March 31, 2020 as filed with the Securities and Exchange Commission on the date hereof (the Report), the undersigned Chief Executive Officer of the Registrant, certifies, in accordance with 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)
The Report, to which this certification is attached as Exhibit 32, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant
Dated: October 12, 2020 |
| /s/ Wilson Russell |
|
| Wilson Russell |
|
| Chief Executive Officer and Chief Financial Officer
|
Document and Entity Information - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2020 |
Sep. 30, 2020 |
|
Details | ||
Registrant CIK | 0001082027 | |
Fiscal Year End | --12-31 | |
Registrant Name | NORTHSTAR ELECTRONICS INC | |
SEC Form | 10-Q | |
Period End date | Mar. 31, 2020 | |
Tax Identification Number (TIN) | 33-0803434 | |
Number of common stock shares outstanding | 127,838,231 | |
Filer Category | Non-accelerated Filer | |
Current with reporting | Yes | |
Interactive Data Current | Yes | |
Shell Company | false | |
Small Business | true | |
Emerging Growth Company | false | |
Entity File Number | 333-90031 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 2020 General Booth Blvd, Unit 230 | |
Entity Address, City or Town | Virginia Beach | |
Entity Address, State or Province | VA | |
Entity Address, Country | US | |
Entity Address, Postal Zip Code | 23454 | |
City Area Code | 780 | |
Local Phone Number | 660-0937 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Document Quarterly Report | true | |
Document Transition Report | false |
Interim Consolidated Balance Sheets - USD ($) |
Mar. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Current | ||
Cash | $ 33,204 | $ 40,261 |
Total assets | 33,204 | 40,261 |
Current | ||
Accounts payable and accrued liabilities | 1,235,792 | 1,220,792 |
Loans payable | 442,916 | 442,916 |
Due to director | 614,928 | 616,159 |
Legal liability | 2,861,441 | 3,100,221 |
Total liabilities | 5,155,077 | 5,380,088 |
Stockholders' Deficit | ||
Common stock value | 12,784 | 12,784 |
Preferred stock value | 404,299 | 404,299 |
Additional paid-in capital | 8,608,875 | 8,608,875 |
Accumulated deficit | (14,147,831) | (14,365,785) |
Total stockholders' deficit | (5,121,873) | (5,339,827) |
Total liabilities and stockholders' deficit | $ 33,204 | $ 40,261 |
Interim Consolidated Balance Sheets - Parenthetical - $ / shares |
Mar. 31, 2020 |
Dec. 31, 2019 |
---|---|---|
Details | ||
Common Stock, Shares Authorized | 200,000,000 | 200,000,000 |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares, Outstanding | 127,838,231 | 127,838,231 |
Common Stock, Shares, Issued | 127,838,231 | 127,838,231 |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Issued | 597,716 | 597,716 |
Preferred Stock, Shares Outstanding | 597,716 | 597,716 |
Interim Consolidated Statements of Operations - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
EXPENSES | ||
Administration | $ 15,000 | $ 15,750 |
Professional fees | 2,126 | 13,298 |
Management fees | 0 | 30,000 |
Engineering | 0 | 11,250 |
Rent | 2,250 | 2,658 |
Investor relations | 0 | 3,375 |
Office | 1,910 | 1,918 |
Foreign exchange (gain) loss | (263,484) | 57,887 |
Interest expense | 24,244 | 24,165 |
Total expenses | (217,954) | 160,301 |
Net income (loss) | $ 217,954 | $ (160,301) |
Basic and diluted gain (loss) per common share | $ 0.00 | $ (0.00) |
Weighted average number of shares outstanding | 127,838,231 | 127,838,231 |
Interim Consolidated Statement of Changes in Stockholders' Deficit - 3 months ended Mar. 31, 2020 - USD ($) |
Common Stock |
Additional Paid-in Capital |
Retained Earnings |
Preferred Stock |
Total |
---|---|---|---|---|---|
Equity Balance at Dec. 31, 2019 | $ 12,784 | $ 8,608,875 | $ (14,365,785) | $ 404,299 | $ (5,339,827) |
Equity Balance, Shares at Dec. 31, 2019 | 127,838,231 | ||||
Net Income (loss) | $ 0 | 0 | 217,954 | 0 | 217,954 |
Equity Balance, Shares at Mar. 31, 2020 | 127,838,231 | ||||
Equity Balance at Mar. 31, 2020 | $ 12,784 | $ 8,608,875 | $ (14,147,831) | $ 404,299 | $ (5,121,873) |
Interim Consolidated Statements of Cash Flows - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
Operating Activities | ||
Net Income (loss) | $ 217,954 | $ (160,301) |
Items not involving cash | ||
Foreign exchange (gain) loss | (263,024) | 34,218 |
Accrued interest | 24,244 | 24,165 |
Changes in operating assets and liabilities | 13,769 | 72,133 |
Changes in non-cash working capital | ||
Net cash used in operating activities | (7,057) | (29,785) |
Decrease in cash | (7,057) | (29,785) |
Cash and Cash Equivalents, at Carrying Value, Beginning Balance | 40,261 | 170,831 |
Cash and Cash Equivalents, at Carrying Value, Ending Balance | $ 33,204 | $ 141,046 |
Nature of Operations and Ability to Continue as a Going Concern |
3 Months Ended |
---|---|
Mar. 31, 2020 | |
Notes | |
Nature of Operations and Ability to Continue as a Going Concern | 1. NATURE OF OPERATIONS AND ABILITY TO CONTINUE AS A GOING CONCERN
Northstar Electronics, Inc. (the Company) was incorporated on May 11, 1998 in the state of Delaware. The Company is doing research and development on single engine aircrafts for business use.
Northstar Electronics, Inc. (the Company) was incorporated on May 11, 1998 in the state of Delaware. The Company is doing research and development on single engine aircrafts for business use.
The Company's business activities are conducted in Canada. However, the financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) with all figures translated into United States dollars for financial reporting purposes.
These unaudited consolidated interim financial statements have been prepared by management in accordance with GAAP for interim financial information, are condensed and do not include all disclosures required for annual financial statements. The organization and business of the Company, accounting policies followed by the Company and other information are contained in the notes to the Companys audited consolidated financial statements filed as part of the Companys December 31, 2019 Form 10-K.
The Company is in the process of regenerating its operations. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the entire fiscal year. The accompanying interim consolidated financial statements have been prepared assuming the Company will continue as a going concern which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. During the three months to March 31, 2020 the Company incurred a net cash outflow of $7,057 and at March 31, 2020 had a working capital deficiency of $5,121,873.
Management has undertaken initiatives for the Company to continue as a going concern; for example: the Company is attempting to secure an equity financing in the short term. Management is unable to predict the results of its initiatives at this time.
Should management be unsuccessful in its initiative to finance its operations, the Companys ability to continue as a going concern is not certain. These financial statements do not give effect to any adjustments to the amounts and classifications of assets and liabilities which might be necessary should the Company be unable to continue its operations as a going concern.
|
Related Party Transactions Disclosure |
3 Months Ended |
---|---|
Mar. 31, 2020 | |
Notes | |
Related Party Transactions Disclosure | 2. RELATED PARTY TRANSACTIONS
a)The amount of $614,928 (December 31, 2019 - $616,159) due to a director of the Company has no specific terms of repayment, is non-interest bearing and unsecured.
b)The Company accrued management fees of $0 in total to a director of the Company for his services as an officer of the Company during the three months ended March 31, 2020 (2019: $30,000).
|
Contingencies Disclosure |
3 Months Ended |
---|---|
Mar. 31, 2020 | |
Notes | |
Contingencies Disclosure | 3. CONTINGENCIES
During 2000 to 2008, the Companys former subsidiaries Northstar Technical Inc. (NTI) and Northstar Network Ltd. (NNL) received funding from Atlantic Canada Opportunities Agency (ACOA) to fund their projects. In 2013, ACOA filed claims against NTI, NNL and the Company for repayments of advances due to events of default. The advance and interests ACOA claims totaled CAD$3,079,475. (2,861,441) In accordance with agreements signed between NTI, NNL and the Company, the Company was jointly and severally liable for the obligations. Further, the claim amount bears a daily interest of CAD$358 from February 15, 2013 to settlement. During the three months ended March 31, 2020, the Company recorded interest expenses of $24,244 (2019: $24,165).
|
New Accounting Pronouncements |
3 Months Ended |
---|---|
Mar. 31, 2020 | |
Notes | |
New Accounting Pronouncements | 4. NEW ACCOUNTING PRONOUNCEMENTS
Management does not believe that any recently issued but not yet effective accounting pronouncements if currently adopted would have a material effect on the accompanying consolidated financial statements.
|
Subsequent Event |
3 Months Ended |
---|---|
Mar. 31, 2020 | |
Notes | |
Subsequent Event | 5. SUBSEQUENT EVENT
In April 2020, 1,495,000 warrants expired unexercised.
In September 2020, another 13,134,208 warrants expired unexercised.
|
Nature of Operations and Ability to Continue as a Going Concern (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
|
Details | ||
Net cash used in operating activities | $ 7,057 | $ 29,785 |
working capital deficiency | $ 5,121,873 |
Related Party Transactions Disclosure (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
Dec. 31, 2019 |
|
Due to director | $ 614,928 | $ 616,159 | |
Accrued management fees to a Director | |||
Fees accrued from related parties | $ 0 | $ 30,000 |
Contingencies Disclosure (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2020 |
Mar. 31, 2019 |
Dec. 31, 2019 |
|
Details | |||
Legal liability | $ 2,861,441 | $ 3,100,221 | |
Interest expense | $ 24,244 | $ 24,165 |
Subsequent Event (Details) - shares |
1 Months Ended | |
---|---|---|
Sep. 30, 2020 |
Apr. 30, 2020 |
|
Details | ||
Warrants expired unexercised | 13,134,208 | 1,495,000 |
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