This Annual Report includes forward-looking statements based on management’s
beliefs, assumptions and plans for the future, information currently available to management and other statements that are not historical
in nature. Forward-looking statements include statements in which words such as “expect,” “anticipate,” “intend,”
“plan,” “believe,” estimate,” “consider,” or similar expressions are used. These forward-looking
statements are not guarantees of future performance and involve risks, uncertainties and assumptions, including among others: a general
economic downturn; a downturn in the securities markets; regulations that affect trading in the securities of “penny stocks”;
the enactment or amendment of laws, rules and regulations that could have a materially adverse impact on current and intended operations;
and other risks and uncertainties.
Our future results and shareholder values may differ materially from those
expressed in these forward-looking statements. Many of the factors that will determine these results and values are beyond our ability
to control or predict. We may be required to update forward-looking statements from time to time as circumstances change; however,
we undertake no duty to do so.
References to “we,” “our” or “us” and
words of similar import under this heading refer to “TORtec Group Corporation,” the Registrant, unless the context implies
otherwise.
ITEM 1. BUSINESS
Introduction
Past Operations
On June 13, 2012, we were formed as a wholly-owned subsidiary of Geo Point
Technologies, Inc., a Utah corporation (“Geo Point Utah”), and into which Geo Point Utah simultaneously authorized the conveyance
of the segment of its business comprising all of its Environmental and Engineering Divisions’ assets, business, operations, rights
or otherwise, along with its “Hydrocarbon Identification Technology” (“HI Technology”) License Agreement dated
January 31, 2008 (the “License Agreement”), subject to the assumption by us of all related liabilities and the indemnification
of Geo Point Utah by us from any liabilities relating to these assets and operations. Also on June 13, 2012, the Board of Directors
of Geo Point Utah approved a stock dividend that resulted in a spin-off of all of our shares of common stock to the Geo Point Utah stockholders,
pro rata, on a one share for one share basis, on the record date (the “Spin-Off”). The Spin-Off had a record date of
January 17, 2013; and ex-dividend date of January 15, 2013; and a Spin-Off payment date of April 22, 2013. On the effective date
of the Spin-Off, there were approximately 1,002,167 outstanding shares of our common stock. For additional information about the
Spin-Off, see our Prospectus dated January 7, 2013, and filed with the SEC on January 8, 2013; and our 8-K Current Report dated April
22, 2013, and filed with the SEC on such date. See Part IV, Item 15.
The Environmental and Engineering Divisions comprised the initial operations
of Geo Point Utah at its inception and were commenced as a “DBA” in 1997, by Geo Point Utah’s founder, William C. Lachmar,
who then served as our President and sole director, in the State of California. The Company operated this business until February 2018
when Mr. Lachmar died. The Company has no plans to continue this business following Mr. Lachmar’s death.
On November 22, 2017, the Company acquired TORtec Group, Inc (“TORtec
Group”) as part of a plan to license and operate a nano milling technology to provide nano milled products and services to industry
(“TOR-technology”). After expending our best efforts to since that acquisition to develop a profitable business, our Board
of Directors concluded it was in our best interests to pursue another direction. Accordingly, on March 20, 2021 at our Annual Shareholders
Meeting, the shareholders approved the sale of TORtec Group and all other assets of the Company to Capital Vario CR S.A. (“Capital
Vario”) in complete and final settlement of the Company’s debts owed
to Capital Vario. The Company presently has no assets and is conducting
a search for an attractive business opportunity and acquisition.
Our Former Acquisition of TORtec Group
As described above, the Company operated this business until March 20,
2021 when the transfer of the Company’s subsidiary which held substantially all Company assets to Capital Vario in satisfaction
of all indebtedness of the Company, was approved by the shareholders at its annual shareholders meeting. The Company is now searching
for an alternative business.
On November 22, 2017, the Company entered into a Share Exchange Agreement
(the “Agreement”) with TORtec Group, Inc. /a Wyoming corporation (“TORtec Group”) and all of the shareholders
of TORtec Group, pursuant to which the Company acquired 100% of the issued and outstanding shares of common stock of TORtec Group. The
acquisition of TORtec Group by the Company was successfully consummated on December 4, 2017.
Under the terms of the Agreement, a total of 90,000,000 shares of the Company’s
restricted common stock were issued to the seventeen TORtec Group shareholders as consideration in exchange for all 10,000,000 issued
and outstanding shares of TORtec Group common stock being transferred to the Company, making TORtec Group a wholly-owned subsidiary of
the Company. As a result, the TORtec Group shareholders collectively own ninety percent (90.0%) of our issued and outstanding shares of
our common stock immediately following the acquisition. New directors and officers of the Company were appointed in connection with the
acquisition.
Stephen Smoot was a former officer of Capital Vario CR S.A. (Capital Vario),
which was the controlling shareholder of the Company prior to the acquisition, but resigned from his affiliation with Capital Vario prior
to a $500,000 debt-to-equity conversion by Capital Vario with the Company. Smoot became the President/CEO and Director of TORtec Group
on September 8, 2017.
As part of the closing of the acquisition, the Company’s then sole
director (William C. Lachmar) elected Franc Smidt, Alex Schmidt, Maksim Goncharenko, Jeffrey R. Brimhall, Stephen H. Smoot, and Irina
Kochetkova to the Company’s Board of Directors before resigning as an officer and director of the Company. The following persons
were then elected as officers of the Company: Franc Smidt – Chairman of the Board of Directors (since resigned as Chairman and director),
Stephen H. Smoot - President and CEO, Alex Schmidt – Vice President, and Irina Kochetkova – Secretary and Treasurer. Jeffrey
R. Brimhall resigned as an officer of the Company but has been appointed to serve as a director. Maksim Goncharenko subsequently resigned
as a director on July 3, 2018.
For additional information concerning the acquisition of TORtec Group,
see the Company’s Current Report on Form 8-K dated December 4, 2017 and filed with the SEC on December 8, 2017, as amended in a
Form 8-K/ Amendment dated June 22, 2018 and filed with the SEC on June 22, 2018.
Licensing and Operations of TOR-technology
Upon completing the acquisition of TORtec Group, we became engaged, through
our subsidiary TORtec Group, in the business of harnessing the natural implosion forces of a vortex (tornado), employing resonating frequencies,
to disintegrate soft to ultra-hard materials into micron or nano-sized particles.
On September 9, 2017, TORtec Group entered into General Agreement No. US-17
with Scientific Research Institute of Technological Progress, Limited, a limited company organized under the laws of Cyprus (“SRITP”)
for the cooperation and joint activities on commercialization of TOR-technologies, introduction of new productions, products and services
in the markets of North, Central and South America (the “Exclusive License Agreement”) with the parties that invented the
TOR-technology. The Exclusive License Agreement granted to TORtec Group an exclusive license to utilize the technology for certain purposes
throughout North, Central and South America. The ‘TOR-technology’ equipment is best described as a cascaded
adiabatic resonance vortex mill utilizing compressed air as the energy in the system. This proprietary technology includes the ability
to size and classify material processed by elemental composition and specific gravity. A more detailed description of the acquisition
is included in the Company’s two Current Reports on Form 8-K: (a) dated November 22, 2017 and filed with the SEC on November 29,
2017; and (b) dated December 4, 2017 and filed with the SEC on December 8, 2017, as amended in a Form 8-K/ Amendment dated June 22, 2018
and filed with the SEC on June 22, 2018; both of which are incorporated herein by this reference.
On June 18, 2018,
TORtec Group entered into License Agreement No. W-1/18 with Forschunginstitut GmbH a limited liability company registered in Switzerland,
the successor-in-interest to SRITP, pursuant to which it was granted a license
to use the TOR technology and the utility model “Tornado” documentation for certain purposes, for which TORtec Group paid
an initial royalty of 30,000 Euros, and agreed to pay an annual royalty equal to 10% of any after tax profit
received by TORtec Group (and any subsidiaries) by the year’s result. A copy of this License Agreement is attached to our Annual
Report on Form 10-K for the fiscal year ended March 31, 2018 as Exhibit 10.1.
On September 9, 2017, TORtec Group entered into an agreement with MTM Center
GmbH, then a shareholder of TORtec, for the construction of a mobile machine that utilizes the TOR-technology, referred to as the Tornado
M. The total purchase price was 394,000 Euros ($474,159 as of September 9, 2017 date of the agreement). On March 3, 2018 the agreement
was amended to the amount of 305,535 Euros or $367,696 representing the original amount of 394,000 Euros or $474,159 less the amount of
88,465 Euros or $106,463 originally allocated to the Kaeser screw-compressor, plus the additional amount of 48,040 Euros or $57,814 in
the form of prepayment for transportation and expenses of technical personnel to come to the USA to commission the mobile “TORNADO
M” unit and payment in advance for an additional vortex chamber with resonating frequency rings for additional applications for
the mobile “TORNADO M” unit, including transportation & insurance to Idaho.
On February 19, 2019, TORtec Group entered into an agreement with TORtec
Forschungsinstitut GmbH, the successor-in-interest to SRITP. This license enlarged the original license with TORtec Forschungsinstitut
GmbH and SRITP and granted exclusive worldwide rights to use the TOR-technology in the following applications:
Mining industry and mineral processing, including: methods of disintegration
of mineral raw materials, methods and technologies of further enrichment of rocks, minerals and processing of technogenic accumulations
under the code name "TOR-technology"; exploitation of specialized mineral processing "Tornado" utility models and the
subsequent recipience of the products by the disintegration of mineral raw materials, mechanical activation, mechanochemical activation
and mechanosynthesis to receive a large range of finished products, blends, composites and solutions; commercialization of licensor's
technological solutions and projects in the mining industry and in the processing of mineral raw materials and technogenic accumulations
to with:
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methods,
techniques and technologies of disintegration of materials, minerals and rocks, mining;
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industrial
waste with subsequent enrichment and/or with the recipience of the product;
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methods
and technologies of mechanical activation, mechanochemical activation, and;
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mechanosynthesis
of mineral raw materials, obtaining materials with new properties and new;
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materials,
composites, mixtures, solutions;
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methods and
technologies of deep processing and decontamination of contaminated materials, waste, and water reclamation;
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methods and
technologies of restoration of the fertility of the land, obtaining new classes of mineral and biomineral fertilizers and mixtures and
mineral protection of soil and plants;
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all or some know-how’s,
trademarks, design development and technical knowledge.
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The Company paid the total amount of two (2) payments totaling 354,600
Euros or $425,510 plus an additional payment of 30,000 Euros or $35,947 for the one-time License fee above. The Company received the Tornado
M machine in the second fiscal quarter of the fiscal year ended March 31, 2019.
On April 11, 2019 TORtec Group entered into a general, exclusive, unlimited,
irrevocable and perpetual license to use the technology, know-how, development and technical knowledge with TORtec Forschungsinstitut
GmbH
for industrial and commercial applications of the complex “TOR-technology”
and utility model “Tornado” in the project Titan+ materials science and production of micro- and nano-structured micropowders
for laser (3d-printing, am-technology), powder and plasma metallurgy for the following applications:
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Field of disintegration (micronization)
of various non-mineral material
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Production of
non-mineral micro- and nano-structured micro powders of metal ceramics, carbides, metal oxides and their mixtures for powder, laser and
plasma metallurgy
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Related documentation,
development and production of unique installations of resonant gas-dynamic grinding of different types of non-mineral materials, united
under a common understanding "tornado"
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The technologies
for grinding non-mineral materials, including multi-component and various-phase materials, their functionalization and modification, their
mechanical, mechanochemical activation and mechanosynthesis
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The production of dispersed new
non-mineral materials and non-mineral materials with new properties.
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All know-how’s, trademarks,
design development and technical knowledge relating to the applications above
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Initial Problems with the Tornado M Machine
Our wholly-owned subsidiary, TORtec Group (Wyoming), purchased the Tornado
“M” (the “unit”) from MTM Center GmbH (“MTM”) in 2017. MTM was owned and controlled by two persons
who then served on our Board of Directors, Franc Smidt (“Smidt”) and Maksim Goncharenko (“Goncharenko”). Goncharenko
subsequently resigned from our board of directors. The unit was initially manufactured by Shostak (“Shostak”) and sold to
MTM which then sold the unit to our subsidiary.
After the unit arrived in the USA in the summer of 2018, a representative
of Shostak arrived with Smidt to commission the start-up of the unit. During this visit, we learned more air was needed for the unit to
work properly. The original Kaiser compressor was returned, and a Curtis compressor was purchased to replace the original Kaiser compressor
and another Curtis compressor was added to give more air according to the instructions of Shostak. These compressors arrived in
January 2019.
Also during the initial visit in 2018 by the Shostak representative and
Smidt, we learned through independent material handling and filter industry technicians and personnel that the unit was not ready for
production for other reasons as well. These reasons included the following: (a) the material feed did not work properly; (b) two
sets of bearings for the unit's rotary feeder were worn out within hours of operation; and (c) significant material “blow-back”
occurred from the inlet to the unit. The cyclone system for the unit did not properly capture or separate the material as represented
by MTM/Smidt or Shostak. The Donaldson filter provided with the unit did not work due to the pulse jet controller being inoperable and
milled material could not be captured properly.
We waited for the Shostak representative and Smidt’s return in January
2019 after the Curtis compressors arrived with the hope that they could get the unit to work properly. Over time the team learned
that it was necessary to replace the feeding system, the cyclone system and the filter system.
When we appealed to Smidt for help, Smidt would direct us to Shostak. Shostak
would comment that its only obligation was to MTM. By the spring of 2019, our management determined that we would have to get the unit
working properly without the sellers help.
With the consent of the directors of TORtec, in May of 2019 we contacted
two of the original shareholders of TORtec, Rock and Frances Rice, and others to invest more money in the Company which would form a joint
venture to develop the proper equipment to get the unit in a working condition. As a result, TORtec Nanosynthesis Corp (“Nano”)
was formed for that purpose. The agreement with investors called for a transfer of rights to the technology for spoecific mineral
applications in North America to go to Nano. This agreement has not yet been prepared and executed by the Company and Nano. The
Company then raised additional funds for ongoing operations for legal, accounting and auditing in addition to funds needed to get the
unit working for the Nano joint venture.
For a detailed description of the formation of TORtec Nanosynthesis Corp.
and the sale of a 49.9% interest in that company, see the Company’s Current Report on Form 8-K for March 31, 2020 which was filed
on April 8, 2020, and is incorporated herein by this reference.
From May, 2019, it took about a year to get the unit working properly.
The only original piece of the unit after this development was the vortex mill (the “mill”). All other components
of the unit were replaced. Thus, as of April 30, 2020, due to the replacement parts and indicators that other potential parts were
non-operational for the intended purposes the Company recorded an impairment of $389,000.In May 2020, several tons of material consisting
of minerals from both Hungary and Nevada together with zeolite from Preston, Idaho were successfully processed
through the unit. Unfortunately, it was determined that the resonant frequency rings in the mill and the mill housing itself was
not made of Boron Carbide as contracted with MTM - but mild steel and the mill wore out after about 7 tons being processed. The
team immediately went to work to get a new mill produced .
Transfer Of All Company Assets and Cessation of Operations
As explained above, the Company continued to operate the TORtec business
until March 2021. On March 22, 2021 pursuant to shareholder approval at our Annual Shareholders Meeting of March 20, 2021, the Company
entered into a debt conversion agreement with Capital Vario CR S.A. (“Capital Vario”) to transfer 100% of TORtec Group and
all other assets of the Company to Capital Vario in complete and final settlement of the Company’s debts owed to Capital Vario.
The Company presently has no assets or operations and is conducting a search for an attractive business opportunity and acquisition.
Business
As described above, the Company has no assets or active business operations
at this time. The officers and members of the Board of Directors are in search of an appropriate new business opportunity.
Principal Products or Services and their Markets
The Company has no present contracts to provide any products or services.
Distribution Methods of the Products or Services
We have no active operations. We do not advertise our services in any publications.
Status of any Publicly Announced New Product or
Service
We have not announced any new product of service.
Competitive Business Conditions and Smaller Reporting
Company’s Competitive Position in the Industry
and Methods of Competition
We have no active business operations at this time.
Estimate of the Amount Spent during each of the
last two Fiscal Years (or since Inception if shorter)
Until January 2019, we had not spent any funds on research and development
since TORtec Group’s inception. During the last two fiscal years ended March 31, 2021, we have spent approximately $47,000 and $302,000,
respectively.
Costs and Effects of Compliance with Environmental
Laws
At this time, we do not anticipate having to spend funds on compliance
with environmental laws in the industries that we intend to operate.
Number of Total Employees and Number of Full-Time
Employees
At this time, we do not have any employees. Our officers and directors
intend to provide services on an as needed basis until such time as the Company hires employees.
Our Former Environmental Remediation
Business
As described above, the Company operated
this business until February 2018 when Mr. Lachmar died. The Company has no plans to continue this business following Mr. Lachmar’s
death.
Our former environmental remediation business was primarily comprised of
services related to identifying any recognized environmental condition (“REC”) or the lack thereof as provided by the federal,
state or local governmental agencies in any real property of any owner, potential owner or lender, governmental agency or other person
that may have a concern or may have or be seeking an interest in the subject property. Once our services were engaged, we contracted
with a drilling company to drill into the ground locations selected by us to collect a physical soil sample; if the project was small
and could be handled by our smaller drilling equipment, this service is not contracted out. During the fiscal year ended March 31,
2015, the field technician that was trained by Mr. Lachmar and who was subcontracted to be onsite during our drilling operations, left
the Company, and Mr. Lachmar was required to resume those duties, which he had been responsible for in earlier fiscal years. During
the first part of fiscal 2017, Mr. Lachmar determined to move the Company from conducting the physical operations that had been previously
conducted by it to a company focused strictly on the professional management the REC services and the leasing of environmental equipment
for REC services rather than a contracting company for these services. The Company acquired and obtained access to some limited
drilling and environmental remediation equipment as part of this change in course and pursued this new course of business through February
2018. This change in the scope of our business operations limited the services available for bid by the Company. Mr. Lachmar would
review the “Scope of Work” for particular proposals that came within the Company’s business focus, and if a particular
proposal was one that required the physical efforts of Mr. Lachmar onsite, he would not bid on the project, but would refer the proposed
project to another party for contracting, with the understanding that such party would lease the equipment of the Company for any such
project to the extent that the Company had the equipment necessary to perform the required field work on the project. Once the soil
sample was obtained, it was submitted to a State of California certified laboratory for analysis of the existence of hazardous materials.
Based upon the laboratory’s analysis, William C. Lachmar prepared a written report that was sanctioned by the particular laboratory
that conducted the analysis. Mr. Lachmar’s licensing as a “Professional Geologist” was a requirement to prepare
any such report. If an REC was identified to exist, then we would provide project management and engineering conclusions and recommendations
necessary to remediate the property and bring it back into regulatory compliance based upon the California tables of acceptable levels
of product contamination. Acceptable levels were further qualified based upon residential, commercial
and industrial zoned properties, with the residential levels being the most stringent. Examples of contaminations that result in
concern included those that were inadvertently or otherwise inoculated into the shallow subsurface soils or groundwater, like gasoline,
diesel fuel, dry cleaning fluid, rocket fuel, arsenic, mercury, lead and other toxic substances. These services were basically the
same in each project: examine the property; drill or have it drilled for soil samples; submit the soil samples to a State of California
certified laboratory; prepare a report on the soil samples; and if an REC was found to exist, provide the described services, directly
or through subcontractors, by or under the supervision of Mr. Lachmar. Sometimes, we merely assessed the environmental impact of
any hazardous materials found and prepared the requested report.
We also provided consulting and compliance services for new utility installation
and general site erosion control for housing tracts and updating service station underground storage tanks and fuel dispensing systems
to comply with continually changing California Air Resources Board (“CARB”) regulations.
Principal Products or Services and their Markets
Our environmental remediation services generally included:
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Construction and Emergency Response;
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Demolition, Remediation and Restoration;
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Subsurface Investigation;
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Water and Wastewater Treatment;
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Engineering and Environmental Consulting;
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Environmental Permitting and Compliance; and
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Distribution Methods of the Products or Services
We did not advertise our services in any publications, and we relied primarily
on past customers for repeat business, including large property management companies, wholesale fuel distributors and automobile dealers,
among others, for referrals. Most of our referrals came from two long standing clients; or three major commercial real estate
management companies in California; or two health specialists to whom we paid commissions for referrals.
All chemicals required for our services were supplied by subcontractors
and were readily available. We did not store any regulated chemicals or waste at our facilities; nor did we manufacture any such products.
We had no real suppliers of products other than some environmental hand
held equipment that was competitively marketed by numerous distributors, and there was little chance that any equipment that was necessary
to conduct our environmental services would not be available to rent or purchase.
Status of any Publicly Announced New Product or
Service
We have not had any recent public announcement of any new product or service.
Competitive Business Conditions and Smaller Reporting
Company’s Competitive Position in the Industry
and Methods of Competition
Our competitors in the environmental remediation business included mostly
large and well-funded entities whose businesses and subsidiaries focused solely on the industries in which we operated. In this
respect, we were at a distinct disadvantage to those competitors. Our services were limited to smaller projects by reason of our
limited financial resources and staff. We believe our competitive position in this industry as a whole was not significant.
Our principal competitors included AECOM Technology Corporation, URS, Kleinfelter,
Levine Fricke, CH2M Hill Companies, Ltd., The Reynolds Group and Geosyntec, most all of which were larger, well financed multinational
publicly-held companies or divisions or subsidiaries of large, well financed multinational companies.
Seasonal Nature of
Our Business
The second quarter of our fiscal year (July 1 to September 30) was typically
our strongest quarter in the environmental remediation business. The U.S. federal government has historically authorized more work during
the period preceding the end of its fiscal year, September 30. In addition, many U.S. state governments with fiscal years ending
on June 30 have historically accelerated spending during the fiscal first quarter when new funding budgets become available.
Dependence on One or a Few Major Customers
During the last two fiscal years we haven’t had any major customers.
Patents, Trademarks, Licenses, Franchises, Concessions,
Royalty Agreements or Labor Contracts, including
Duration
We do not hold any patents; however, we have proprietary technology applications
related to our hydrocarbon-indicating methods and technology (the “HI Technology”), which was developed and licensed by Mr.
Lachmar to our predecessor parent, Geo Point Utah, and assigned to us on our formation on June 13, 2012.
The material terms of the License Agreement are as follows:
Mr. Lachmar granted to us an exclusive, world-wide license to use the HI
Technology for commercial exploitation, including subleasing the HI Technology to other parties.
The intellectual property associated with the HI Technology, as well as
any additional related intellectual property developed by Mr. Lachmar, is included within the scope of the license. Currently, the
intellectual property is maintained as trade secrets and protected by the confidentiality provisions of the License Agreement; however,
any patents, trademarks or copyrights or applications therefore, related to the HI Technology, will also be included within the scope
of the License Agreement.
Upon execution of the License Agreement, Geo Point Utah, the original licensee
under the License Agreement, paid Mr. Lachmar a one-time license fee of $125,000. Except as otherwise provided therein and as discussed
below, the License Agreement is irrevocable.
Mr. Lachmar retained the right to exploit the Hi Technology and processes.
The License Agreement may be terminated by either party, subject to a 60-day
notice period, upon a breach of the License Agreement that remains uncured during the notice period.
The License Agreement may be terminated by the assignees of Mr. Lachmar’s
estate in the event we become insolvent or unable to pay our debts as they come due, become the subject of a bankruptcy proceeding (voluntary
or involuntary), other than a reorganization, or enter into a general assignment for the benefit of our creditors.
The HI Technology underlying the License Agreement, which is related to
petroleum geology, has not been promoted to customers and requires substantial research and development of hydrocarbon-indicating methods
and technology. No funds were expended for research and development of the HI Technology during the fiscal years ended March 31,
2021, and 2020.
Need for any Governmental Approval of Principal
Products or Services
We have the necessary licenses and qualifications,
singly or through our subcontractors, to conduct our business operations, without government approval, except to the extent of compliance
with applicable governmental regulations related to our business, which are summarized below under the heading “Effect of Existing
or Probable Governmental Regulations on Our Business,” below.
Effect of Existing
or Probable Governmental Regulations on the Business
Federal and State Law
We are regulated in a number of fields
in which we operate. In the United States, we deal with numerous U.S. and California state governmental agencies and entities, including
the U.S. Environmental Protection Agency, the Carpenter-Presley-Tanner Hazardous Substance Account Act (the “California Superfund
Act”), the Porter-Cologne Water Quality Control Act (the “California Water Control Act”) and CARB. When working
with these governmental agencies and entities, we must comply with laws and regulations relating to the formation, administration and
performance of our contracts.
Risk assessment practices under these acts include the most current sound
scientific methods for data evaluation, exposure assessment, toxicity assessment and risk characterization, documentation of all assumptions,
methods, models and calculations used in the assessment including any health risk assessment. These assessments generally include:
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Evaluation of risks posed by acutely toxic hazardous substances based on levels
at which no known or anticipated adverse effects on health will occur, with an adequate margin of safety.
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Evaluation of risks posed by carcinogens or other hazardous substances that may
cause chronic disease based on a level that does not pose any significant risk to health.
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Consideration of possible synergistic effects resulting from exposure to, or interaction
with, two or more hazardous substances.
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Consideration of the effect of hazardous substances upon subgroups that comprise
a meaningful portion of the general population, including, but not limited to, infants, children, pregnant women, the elderly, individuals
with a history of serious illness, or other subpopulations, that are identifiable as being at greater risk of adverse health effects due
to exposure to hazardous substances than the general population.
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Consideration of exposure and body burden level that alter physiological function
or structure in a manner that may significantly increase the risk of illness and of exposure to hazardous substances in all media, including,
but not limited to, exposures in drinking water, food, ambient and indoor air, and soil.
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If currently available scientific data is insufficient to determine the level of
a hazardous substance at which no known or anticipated adverse effects on health will occur, with an adequate margin of safety, or the
level that poses no significant risk to public health, the risk assessment prepared in conjunction with a response action taken or approved
shall be based on the level that is protective of public health, with an adequate margin of safety. This level shall be based exclusively
on public health considerations; shall, to the extent scientific data are available, take into account the factors set forth; and shall
be based on the most current principles, practices and methods used by public health professionals who are experienced practitioners in
the fields of epidemiology, risk assessment, fate and transport analysis, and toxicology.
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Compliance with federal, state and local
laws enacted for the protection of the environment has to date had no significant effect on our capital expenditures, earnings or competitive
position. These costs are an integral part of the services that we provide. In the future, compliance with environmental laws
could materially adversely affect us. We will continue to monitor the impact of such laws on our business and will develop appropriate
compliance programs.
Emerging Growth Company
We are an “emerging growth company” as defined in the Jumpstart
Our Business Startups Act of 2012, or “JOBS Act.” As long as we remain an “emerging growth company,” we
may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not
an “emerging growth company,” like those applicable to a “smaller reporting company,” including, but not limited
to, a scaled down description of our business in SEC filings; no requirements to include risk factors in the Exchange Act filings; no
requirement to include certain selected financial data and supplementary financial information in SEC filings; not being
required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act; reduced disclosure obligations
regarding executive compensation in our periodic reports and proxy statements that we file under the Exchange Act; no requirement for
Sarbanes-Oxley Act Section 404(b) auditor attestations of internal control over financial reporting; and exemptions from the requirements
of holding an annual nonbinding advisory vote on executive compensation and seeking nonbinding shareholder approval of any golden parachute
payments not previously approved. We are also only required to file audited financial statements for the previous two fiscal years
when filing registration statements, together with reviewed financial statements of any applicable subsequent quarter.
We may take advantage of these reporting exemptions until we are no longer
an “emerging growth company.” We can remain an “emerging growth company” for up to five years. We
would cease to be an “emerging growth company” prior to such time if we have total annual gross revenues of $1 billion or
more and when we become a “larger accelerated filer,” have a public float of $700 million or more or we issue more than $1
billion of non-convertible debt over a three-year period.
Under the JOBS Act, emerging growth companies can also delay adopting new
or revised accounting standards until such time as those standards apply to private companies. We have irrevocably elected not to avail
ourselves of this exemption from new or revised accounting standards and, therefore, will be subject to the same new or revised accounting
standards as other public companies that are not emerging growth companies.
Smaller Reporting Company
We became subject to the reporting requirements
of Section 15(d) of the Exchange Act, subject to the disclosure requirements of Regulation S-K of the SEC, as a “smaller reporting
company,” on the effective date of our Registration Statement. The designation of being a “smaller reporting company”
relieves us of some of the more detailed informational requirements of Regulation S-K. See the heading “Emerging Growth Company”
directly above for a brief summary of some of the principal reduced requirements available to a “smaller reporting company.”
Sarbanes/Oxley Act
We are subject to the Sarbanes-Oxley Act of 2002. The Sarbanes/Oxley
Act created a strong and independent accounting oversight board to oversee the conduct of auditors of public companies and strengthens
auditor independence. It also requires steps to enhance the direct responsibility of senior members of management for financial
reporting and for the quality of financial disclosures made by public companies; establishes clear statutory rules to limit, and to expose
to public view, possible conflicts of interest affecting securities analysts; creates guidelines for audit committee members’ appointment,
compensation and oversight of the work of public companies’ auditors; management assessment of our internal controls; prohibits
certain insider trading during pension fund blackout periods; requires companies and auditors to evaluate internal controls and procedures;
and establishes a federal crime of securities fraud, among other provisions. Compliance with the requirements of the Sarbanes/Oxley Act
will substantially increase our legal and accounting costs.
Exchange Act Reporting Requirements
Section 15(d) of the Exchange Act requires all companies that have filed
a registration statement under the Securities Act to file annual reports on Form 10-K and quarterly reports on Form 10-Q with the SEC
for a period of one year from the effective date of the Registration Statement, and we will be required to timely disclose certain material
events (e.g., changes in corporate control; acquisitions or dispositions of a significant amount of assets other than in the ordinary
course of business; and bankruptcy) in a Current Report on Form 8-K.
Research and Development Costs during the Last Two Fiscal Years
During our fiscal years ended March 31, 2021 and 2020, we incurred cost
related to the improvement of our Tornado M.
Cost and Effects of Compliance with Environmental
Laws
We do not maintain any hazardous chemicals on-site, and those chemicals
we utilized in our remediation services were shipped directly to the impacted site from the supplier of chemicals, with all the proper
manifests by a certified Hazardous Materials transporter. These chemicals are available from a wide array of suppliers.
We neither store nor manufacture any materials that require us to maintain
any federal, state or local permits. Accordingly, the cost and effects of compliance with environmental laws on our business is negligible.
Additional Information
You may read and copy any materials that we file with the SEC at the SEC’s
Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may also find all of the reports or registration statements
that we have filed electronically with the SEC at its Internet site at www.sec.gov. Please call the SEC at 1-202-551-8090 for further
information on this or other Public Reference Rooms. Our SEC reports and registration statements are also available from commercial
document retrieval services, such as CCH Washington Service Bureau, whose telephone number is 1-800-344-3734.