Common Stock

3 Months Ended

Mar. 31, 2012

Notes to Financial Statements

Note 6. Common Stock

In February 2007 the Company issued 64,000,000 shares of common stock at $.0000125 per share to the Founders of the Company for $800.

In February 2008 the Company sold 22,400,000 shares of common stock at $.002 per share pursuant to its public offering.  The Company received net proceeds of $44,964.

In February 2008 the Company issued 800,000 shares of common stock with the fair value of $.0075 per share for services rendered.  The Company recorded stock based compensation expense of $6,000 in connection with this issuance.

On December 15, 2010, the Company notified the FINRA of its intention to implement a 1 for 8 share dividend or forward stock split of its issued and outstanding common stock to the holders of record as of December 27, 2010 (the “Shareholders”). The forward stock split became effective as of the start of business on January 3, 2011.  All share and per share data have been retroactively restated to reflect this recapitalization.

On December 13, 2010 the Company issued 20,000,000 shares of common stock as payment for certain mining leases in Honduras at a fair value of $2,500.

On February 22, 2011 the Company issued 20,000,000 shares of common stock as payment for certain additional mining leases in Honduras at a fair value of $2,500.

On March 28, 2011 the Company sold 60,000 units consisting of 60,000 shares of common stock and 30,000 warrants for $15,000.  The warrants are exercisable at $.50 per share and have a two year term.

On March 31, 2011 the Company's CEO retired 30,000,000 shares of his common stock of the Company as additional paid-in capital.

On April 12, 2011, the Company sold 1,000,000 units consisting of 1,000,000 shares of common stock and 500,000 warrants for cash of $250,000.  The warrants are exercisable at $.50 per share and have a two year term

On April 20, 2011, the Company sold 100,000 units consisting of 100,000 shares of common stock and 50,000 warrants for cash of $25,000.  The warrants are exercisable at $.50 per share and have a two year term.

On April 21, 2011, the Company sold 100,000 units consisting of 100,000 shares of common stock and 50,000 warrants for cash of $25,000.  The warrants are exercisable at $.50 per share and have a two year term.

On May 6, 2011, the Company sold 60,000 units consisting of 60,000 shares of common stock and 30,000 warrants for cash of $15,000.  The warrants are exercisable at $.50 per share and have a two year term.

On May 11, 2011, the Company sold 20,000 units consisting of 20,000 shares of common stock and 10,000 warrants for cash of $5,000.  The warrants are exercisable at $.50 per share and have a two year term.

On July 19, 2011, the Company issued 40,000 units to Mark Holcombe, a director of the Company in consideration of consisting of 40,000 shares of common stock and 20,000 warrants with a fair value of $1,583. Each warrant allows Mr. Holcombe to purchase one additional share of common stock at a price of $0.50 per share for two years.  The shares were valued at $.25 per share, the fair value on the date of grant.

On July 21, 2011, the Company issued 100,000 shares to Lawrence H. Wolfe, our Chief Financial Officer, in consideration for the execution and delivery of a consulting agreement with Mr. Wolfe.  The shares were valued at $.24 per share, the fair value on the date of grant.

On July 21, 2011, the Company issued 100,000 shares to Zegal and Ross Capital LLC in consideration for the execution and delivery of a consulting agreement. The shares were valued at $.24 per share, the fair value on the date of grant.

On July 25, 2011, the Company issued 100,000 shares to Mendel Mochkin, a director, in consideration for the execution and delivery of a consulting agreement with such person which replaced in its entirety Mr. Mochkin's employment agreement. Mr. Mochkin is an accredited investor. The issuance was conducted in reliance upon an exemption from registration provided under Section 4(2) of the Securities Act of 1933, as amended.  The shares were valued at $.24 per share, the fair value on the date of grant.

On July 27, 2011 the Company sold 1,000,000 units in consideration of $250,000 consisting of 1,000,000 shares of common stock and 1,000,000 warrants. Each warrant allows for the purchase one additional share of common stock at a price of $0.50 per share for two years.

On October 24, 2011, we issued 20,000 shares to Ben Lafazan and 20,000 shares to Barry Wolinetz as partial settlement for services rendered. The shares were valued at $.22 per share, the fair value on the date of grant.

At December 31, 2011 the Company has 297,516 shares issuable to officers and directors with a fair value of $74,000 in connection with certain consulting agreements.  These shares were valued at the fair value on the date of grant.  These shares were issued to officers and directors during March, 2012.

   In February and March 2012 the company raised an aggregate of $175,000 from one investor under a Regulation S Subscription Agreement. Under this agreement, the Company is offering for sale up to $500,000 of shares and warrants at a purchase price of $1.00 per share. For each dollar invested, the investor will receive one share of common stock and one warrant. Each warrant entitles the investor to purchase one share of common stock for $1.50 per share. The warrants expire on the third anniversary date its issuance.

On February 3, 2012, the Company issued 200,000 shares of common stock as payment for certain mining equipments in Honduras at a fair value of $106,000 based on the value of the equipment.

On March 1, 2012, an investor exercised his right to purchase 30,000 shares for $.50 per share. The Company received proceeds of $15,000.

At March 31, 2011 the Company has 41,617 shares issuable to officers and directors with a fair value of $39,000 in connection with certain consulting agreements.  These shares were valued at the fair value on the date of grant.

Warrants

During 2011, the Company issued 1,690,000 warrants in connection with a private placement offering. The warrants have a term of two years from the date of the subscription agreement and allow investors to purchase one share of common stock for $.50.  At March 31, 2012 and December 31, 2011 all warrants have a remaining contractual life of approximately 1.5 years and 1.25 years, respectively.

In February and March 2012, the company issued 175,000 warrants in connection with a private placement offering. The warrants have a term of three years from the date of the subscription agreement and allow investors to purchase one share of common stock for $1.50 per share. At March 31, 2012, all warrants have a remaining contractual life of approximately 3 years.

Information with respect to warrants outstanding and exercisable at March 31, 2012 is as follows:

Three Months Ended, March 31, 2012:
	Number Outstanding		Range of Exercise Price		Number Exercisable
Warrants outstanding, December 31, 2011		1,690,000	$	0.50		1,690,000
Issued		175,000	$	1.50		175,000
Exercised		(30,000)	$	0.50		-
Expired		-		--		-
Warrants outstanding, March 31, 2012		1,835,000	$	0.50-1.50		1,835,000

Options

During July 2011, the Company granted 360,000 stock options to consultants for services to be rendered over a two-year period.  The options are exercisable at $0.50 per share, half of the option shall vest on January 1 and half on June 1 following the grant date. These options had a fair value of $61,104 using the Black-Scholes option-pricing model. The grant date fair values of the Company’s option awards during the three months ended March 31, 2012 and the year ended December 31, 2011 were estimated using the Black Scholes option pricing model with the following assumptions:

	For the Three months ended			For the Year ended
	March 31, 2012			December 31, 2011
Expected life (years)		2			2
Risk – free interest rate		0.40	%		0.40	%
Expected volatility		178	%		178	%
Dividend Yield		0.00	%		0.00	%

The Company has Consultancy agreements that contain provisions for the issuance and granting of options aggregating 3,000,000 shares at $.50 per share  that are predicated on the Company reaching certain milestones in the production of gold.  None of the milestones have been met and accordingly such options have not been granted or issued.

	Number of Options		Weighted Average Exercise Price
Balance at December 31, 2011		360,000	$	0.50
Granted		-		-
Exercised		-		-
Forfeited		-		-
Balance at March 31, 2012		360,000	$	0.50
Options exercisable at December 31, 2011		180,000	$	0.50
Weighted average fair value of options granted during 2012			$	61,104.00

 Of the total 360,000 options granted during 2011, 180,000 of them are vested, exercisable and non-forfeitable.

The following table summarizes information about stock options for the Company as of March 31, 2012 and December 31, 2011:

2012 Options Outstanding					2012 Options Exercisable
Number	Weighted Average
Outstanding at	Remaining		Weighted Average		Vested at
March 31, 2012	Contractual Life		Exercise Price		March, 31, 2012
360,000		1.17	$	0.50		180,000	$	0.50

2011 Options Outstanding					2011 Options Exercisable
Number	Weighted Average				Vested at
Outstanding at	Remaining		Weighted Average		December 31,
December 31, 2011	Contractual Life		Exercise Price		2011
360,000		1.42	$	0.50		-	$	0.50