XML 37 R7.htm IDEA: XBRL DOCUMENT v2.4.0.8
Note 2 - Going Concern
9 Months Ended
Mar. 31, 2014
Notes  
Note 2 - Going Concern

NOTE 2 – GOING CONCERN

 

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  As shown in the accompanying condensed consolidated financial statements, the Company incurred a net loss of $399,084 for the quarter ended March 31, 2014 and has an accumulated deficit of $3,599,122 from inception (July 5, 2011) through March 31, 2014.  The Company also used cash in operating activities of $135,607 during the nine months ended March 31, 2014.  At March 31, 2014, the Company had negative working capital of $1,408,424.  The Company is in default on notes payable. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

 

The Company has not made the annual payment of $200,000 that was due on December 12, 2013, under the terms of its Shai Hills property (see Note 8 – Capital Lease Obligation). Unless the Company is able to obtain the required capital to make this payment it will be in jeopardy of losing the entire lease.

 

In order for us to continue as a going concern, we expect to obtain additional debt and/or equity financing. We are regularly and continually seeking additional funding from investors and from time to time we are in various stages of negotiations.  Nonetheless, to date we have not accomplished a financing of the size needed to put the Company on a stable operating basis. There can be no assurance that we will be able to secure additional debt or equity financing, that we will be able to attain positive cash flow operations, or that, if we are successful in any of those actions, those actions will produce adequate cash flow to enable us to meet our future obligations. All of our existing financing arrangements are short-term. If we are unable to obtain additional debt and/or equity financing, we may be required to significantly reduce or cease operations.