Form 10-12g/A
GENERAL FORM FOR REGISTRATION OF SECURITIES
Pursuant to Section 12(b) or (g) of
the Securities Exchange Act of 1934
Amendment No. 1
Gryphon Resources, Inc.
(Exact name of Registrant as specified in
its charter)
Nevada
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98-0465540
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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3512 Desert Mesa Road
Roanoke, TX 76262
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(Address of principal executive offices)
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(315) 254-8553
(Registrant’s telephone number, including
area code)
With Copies to:
Davisson & Associates, PA
Attn: Peder K. Davisson, Esq.
4124 Quebec Avenue North, Suite 306
Minneapolis, MN 55427
Telephone Number: (763) 355 - 5678
Securities to be registered pursuant to Section 12(b)
of the Act: None
Securities to be registered pursuant
to Section 12(g) of the Act:
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Title of Each Class to be so Registered
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Common Shares, par value $0.001
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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 definitions of
a “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2
of the Exchange Act.
Large accelerated filer
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☐
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☒
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Emerging Growth Company
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☐
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EXPLANATORY NOTE
This registration statement on Form 10
(the “ Registration Statement ”) is being filed by Gryphon Resources, Inc. in order to register common stock
of the Company voluntarily pursuant to Section 12(g) under the Securities Exchange Act of 1934, as amended (the “ Exchange
Act ”). The Company is not required to file this Registration Statement pursuant to the Securities Act of 1933, as amended
(the “ Securities Act ”).
Once this registration statement is deemed
effective, we will be subject to the requirements of Regulation 13A under the Exchange Act, which will require us to file annual
reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and we will be required to comply with all
other obligations of the Exchange Act applicable to issuers filing registration statements pursuant to Section 12(g) of the Exchange
Act. The registration statement, including exhibits, may be inspected without charge at the SEC’s principal office
in Washington, D.C., and copies of all or any part thereof may be obtained from the Public Reference Section, Securities and Exchange
Commission, 100 F Street, NW, Washington, D.C. 20549 upon payment of the prescribed fees. You may obtain information on the operation
of the Public Reference Room by calling the SEC at l.800.SEC.0330. The SEC maintains a Website that contains reports, proxy and
information statements and other information regarding registrants that file electronically with it. The address of the SEC’s
Website is http://www.sec.gov.
1
FORWARD LOOKING STATEMENTS
There are statements in this registration statement
that are not historical facts. These “forward-looking statements” can be identified by use of terminology such as “believe,”
“hope,” “may,” “anticipate,” “should,” “intend,” “plan,”
“will,” “expect,” “estimate,” “project,” “positioned,” “strategy”
and similar expressions. You should be aware that these forward-looking statements are subject to risks and uncertainties that
are beyond our control. Although management believes that the assumptions underlying the forward looking statements included in
this registration statement are reasonable, they do not guarantee our future performance, and actual results could differ from
those contemplated by these forward looking statements. The assumptions used for purposes of the forward-looking statements specified
in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic,
legislative, industry, and other circumstances. As a result, the identification and interpretation of data and other information
and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment.
To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and,
accordingly, no opinion is expressed on the achievability of those forward-looking statements. In light of these risks and uncertainties,
there can be no assurance that the results and events contemplated by the forward-looking statements contained in this registration
statement will in fact transpire. You are cautioned to not place undue reliance on these forward-looking statements, which speak
only as of their dates. We do not undertake any obligation to update or revise any forward-looking statements unless required by
applicable laws or regulations.
2
Table of Contents
For Form 10
Of
Gryphon Resources, Inc.
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Page
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Item 1.
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Business
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4
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Item 1A.
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Risk Factors
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4
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Item 2.
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Financial Information
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5
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Item 3.
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Properties
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9
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Item 4.
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Security Ownership of Certain Beneficial Owners and Management
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9
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Item 5.
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Directors and Officers
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10
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Item 6.
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Executive Compensation
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11
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Item 7.
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Certain Relationships and Related Transactions, and Director Independence
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12
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Item 8.
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Legal Proceedings
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12
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Item 9.
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Market Price of and Dividends on the Registrant’s Common Equity and Related Stockholder Matters
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13
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Item 10.
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Recent Sales of Unregistered Securities
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14
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Item 11.
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Description of Registrant’s Securities to be Registered
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14
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Item 12.
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Indemnification of Directors and Officers
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15
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Item 13.
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Financial Statements and Supplementary Data
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15
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Item 14.
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
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15
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Item 15.
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Exhibits, Financial Statement Schedules
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16
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3
Gryphon Resources, Inc.
INFORMATION REQUIRED IN REGISTRATION
STATEMENT
Item 1. Business.
Organizational History.
Gryphon Resources, Inc. (“Gryphon”,
“We”, or the “Company”) was incorporated in the State of Nevada on January 16, 2006 under the name Gryphon
Oil & Gas, Inc. On March 22, 2007, our name was changed to Gryphon Resources, Inc. to more accurately reflect the nature of
our operations. At the time of the filing of our initial registration statement on Form SB-2 with the Securities & Exchange
Commission (the “SEC” or “Commission”) on or about April 25, 2007 our primary business focus was acquiring
and exploring properties for the existence of commercially viable deposits of gold in Canada. On April 28, 2008 we incorporated
a Turkish company named APM Madencilik Sanayi Ve Ticaret Limited Sirketi. (“APM”) as a 99% owned subsidiary. Thereafter,
In July, 2010, we re-focused our operations and began mineral exploration in Arizona, USA and on September 27, 2010, sold our entire
shareholdings in APM to an unrelated third party and ceased all operations in Turkey. Thereafter focused on mineral exploration
and continued exploring for gold, silver and copper-porphyry; and lithium on two different properties in the State of Arizona,
USA. Following the filing of our Information Statement on May 15, 2009 with the Commission on DEF Schedule 14C, on May 26, 2009
we amended or Articles of Incorporation to increase our common stock from 100 million shares to 400 million shares, $0.001 par
value, authorized for issuance. On May 3, 2012 prior management filed a termination of our registration statement on Form 15-12G
pursuant to Rule 12g-4(a)1 and our termination went effective 90 days later on August 1, 2012 then on May 4, 2012 the Company was
dissolved at the Nevada Secretary of State’s office and on August 28, 2018, its corporate charter was reinstated.
On February 21, 2018, one of the Company’s shareholders made a motion and application to be appointed as custodian of the
Company based on prior management abandoning its responsibilities to continue making filings at the Nevada Secretary of State’s
office and for failing to hold a shareholders’ meeting in over 6 years otherwise keep current in its obligations to the Company.
Upon motion and application to the District Court, Clark County Nevada, the Court granted the shareholder’s request and the
shareholder was appointed as custodian for the Company (“Custodian”). As Custodian of the Company, the shareholder
was ordered to file an amendment to the Company’s articles of incorporation which was filed in conformity with N.R.S. 78.347(4)
and the shareholder was ordered to have the Company’s charter reinstated in Nevada, to notice and hold a shareholder meeting;
to provide a report to the Court of the actions taken at the shareholder meeting; to identify and name a new registered agent in
the State of Nevada; to reinstate the Company in the State of Nevada and the Custodian is complying with the Court Order and will
be filing a motion for termination of the Custodian which will be followed by an Order from the Court terminating the Custodian
and acknowledging that the Custodian has complied with all of the requirements listed by the Court in its Order for Appointment.
The Custodian was given the power and authority to take any action it deemed reasonable and for the benefit of the Company and
its shareholders. A Copy of the Order Appointing the Custodian is furnished with this Registration Statement as Exhibit 99.1.
The Company has since been seeking a merger target and has been evaluating various opportunities.
Our Business
The Company is currently attempting to locate
and negotiate with an eligible target company or companies and to acquire an interest in it/them by way of a share exchange or
reverse merger. In addition to acquiring an interest in it/them, the Company may assist any such target company or companies with
raising capital, as necessary, and offer such target(s) with managerial assistance as may be needed to help the combined enterprise
to succeed.
Employees
As of the date of this registration
statement filed on Form 10, we have no employees.
Item 1A. Risk Factors.
We are a smaller reporting company and therefore
not required to provide this information in our Form 10 registration statement.
4
Item 2. Financial Information.
Selected Financial Information
We are a smaller reporting company and therefore
not required to provide this information in our Form 10 registration statement.
Management’s Discussion and Analysis
of Financial Condition and Results of Operation.
Overview
The following discussion and analysis of our
financial condition and results of operations (“MD&A”) should be read in conjunction with our financial statements
and the accompanying notes to the financial statements included in this Form 10-K.
The MD&A is based on our financial statements,
which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates
and judgments that affect the reported amounts of assets, liabilities and expenses and related disclosure of contingent assets
and liabilities. Management bases its estimates on historical experience and on various other assumptions that are believed to
be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets
and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different
assumptions or conditions.
Background
We are not currently engaged in any business
operations. We are, however, in the process of attempting to identify, locate, and if warranted, acquire a new target company with
attractive commercial opportunities.
No revenue has been generated by the Company.
It is unlikely the Company will have any revenues unless it is able to effect an acquisition or merger with an operating company,
of which there can be no assurance. The Company’s plan of operation for the remainder of the fiscal year shall be to continue
its efforts to locate suitable acquisition candidates. Our principal business objective for the next 12 months and beyond such
time will be to achieve long-term growth potential through a combination with a business rather than immediate, short-term earnings.
The Company will not restrict our potential candidate target companies to any specific business, industry or geographical location
and, thus, may acquire any type of business.
The Company does not currently engage in any
business activities that provide cash flow. The costs of investigating and analyzing business combinations for the next 12 months
and beyond such time will be paid with funds to be loaned to or invested in us by our stockholders, management or other investors.
During the next 12 months we anticipate incurring
costs related to:
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(i)
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filing of Exchange Act reports, and
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(ii)
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investigating, analyzing and consummating
an acquisition.
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We believe we will be able to meet these costs
through use of funds to be loaned by or invested in us by our stockholders, management or other investors. There are no assurances
that such funds will be advanced or that the Company will be able to secure any additional funding as needed.
5
Results of Operations
Years Ended September 30, 2018 and September 30, 2017
The professional fees were $17,489 and $0,
in the years ended September 30, 2018 and September 30, 2017, respectively. This was due to an increase in business operations
in 2018 as the Company prepared to meet reporting obligations in anticipation of filing this Form 10 as well as bringing its obligations
current. General & Administrative expenses were $7,605 and $0, for the years ended September 30, 2018 and September 30, 2017,
respectively.
The interest expense of $5,955 for the year
ended September 30, 2018 was related to a beneficial conversion feature for a convertible note payable that the Company issued
on that date. On September 2018 we received funding from issuing $5,955 in a convertible note payable to a legal custodian of the
company. The note bears interest at an annual rate of 10% and is convertible to common shares of the Company at $0.0001 per share.
As of September 30, 2018, $5,955 of the principal balance remained outstanding on the note payable and $0. In connection with the
above note, the Company recognized a beneficial conversion feature of $5,955, representing the maximum amount of the intrinsic
value of the conversion feature at the time of issuance. This beneficial conversion feature was accreted to interest expense
during the year ended September 30, 2018.
Net cash used in operating activities was $5,955
for the year ended September 30, 2018, compared to net cash used in operating activities of $0 for the previous year ended September
30, 2017. Based on our current level of expenditures, additional funding is required to cover our operations for at least the next
twelve months. The company is in the process of attempting to identify, locate, and if warranted, acquire new commercial
opportunities.
Liquidity and Capital Resources - Years Ended September 30,
2018 and September 30, 2017
As of the year ended September 30, 2018, we
had an accumulated deficit of $715,878 and cash and cash equivalents of $0. In the year ended September 30, 2017, we had an accumulated
deficit of $684,829 and cash and cash equivalents of $0.
In September 2018, the Company incurred a related
party payable in the amount of $3,000 to an entity related to the legal custodian of the Company for professional fees . As of
September 30, 2018, a balance of $3,000 remained outstanding.
On September 2018 we received funding from
issuing $5,955 in a convertible note payable to a legal custodian of the company.. The note bears interest at an annual rate of
10% and is convertible to common shares of the Company at $0.0001 per share. As of September 30, 2018, $5,955 of the principal
balance remained outstanding on the note payable and $0.
In connection with the above note, the Company
recognized a beneficial conversion feature of $5,955, representing the maximum amount of the intrinsic value of the conversion
feature at the time of issuance. This beneficial conversion feature was accreted to interest expense during the year ended
September 30, 2018.
Other Contractual Obligations
As of the year ended September 30, 2018, we
do not have any contractual obligations other than the $5,955 convertible note payable to a legal custodian of the company and
related accrued interest on this note of $0. As of the nine months ended June 30, 2019, we do not have any contractual obligations
other than the $12,148 in promissory notes payable to a legal custodian of the company and related accrued interest on this note
of $0.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Recently Issued Accounting Pronouncements
We review new accounting standards as
issued. Although some of these accounting standards issued or effective after the end of our previous fiscal year may be applicable
to the Company, we have not identified any standards that we believe merit further discussion. We do not expect the adoption of
any recently issued accounting pronouncements to have a significant impact on our financial position, results of operations, or
cash flows.
6
Nine Months Ended June 30, 2019 and June 30, 2018
The professional fees were $13,369 and $1,949,
in the nine months ended June 30, 2019 and June 30, 2018, respectively. This was due to an increase in business operations in 2019.
General & Administrative expenses were $1,499 and $0 for the nine months ended June 30, 2019 and June 30, 2018, respectively.
Interest expense of $15,408 for the nine months
ended June 30, 2019 was related to a beneficial conversion feature for a convertible note payable that the Company issued and accrued
interest on the note. In October 2018 and January 2019 we received funding from issuing $5,000 and $10,000 respectively, in convertible
notes payable to a legal custodian of the company. The notes bear interest at an annual rate of 10% and are convertible to common
shares of the Company at $0.0001 per share. As of June 30, 2019, these notes have been converted in to common stock and $0 of the
principal balance and $0 in accrued interest remain outstanding. Interest expense of $202 for the nine months ended June 30, 2019
was related to accrued interest on promissory notes. In 2019 we received funding from issuing $12,148, in notes payable to a legal
custodian of the company. The notes bear interest at an annual rate of 10% and are payable upon demand. As of June 30, 2019, $12,148
of the principal balance and $202 in accrued interest remained outstanding on the notes payable.
As of June 30, 2019, $0 of the principal balance
and accrued interest remained outstanding on the note payable. In connection with the above note, the Company recognized a beneficial
conversion feature of $15,000, representing the maximum amount of the intrinsic value of the conversion feature at the time of
issuance. This beneficial conversion feature was accreted to interest expense during the nine months ended June 30, 2019.
Net cash used in operating activities was $27,148
for the nine months ended June 30, 2019, compared to net cash used in operating activities of $1,949 for the previous nine months
ended June 30, 2018. Based on our current level of expenditures, additional funding is required to cover our operations for at
least the next twelve months. The company is in the process of attempting to identify, locate, and if warranted, acquire new commercial
opportunities
Liquidity and Capital Resources – Nine Months Ended
June 31, 2019 and June 30, 2018
As of the nine months ended June 30, 2019,
we had an accumulated deficit of $746,154 and cash and cash equivalents of $0. In the year ended September 30, 2018, we had an
accumulated deficit of $715,878 and cash and cash equivalents of $0.
In September 2018 – June 2019, the Company
incurred a related party payable in the amount of $4,500 to an entity related to the legal custodian of the Company for professional
fees. As of June 30, 2019, $4,000 of this balance was converted into a promissory note payable, bearing interest at an annual rate
of 10% and $500 remains outstanding.
In September 30, 2018 – December 2018,
the Company issued $10,955 in convertible notes payable to an entity related to the legal custodian of the Company. These notes
bear interest at an annual rate of 10% and are convertible to common shares of the Company at $0.0001 per share. As of June 30,
2019, $0 of the principal balance and $0 accrued interest is outstanding on the note payable.
In connection with the above note, the Company recognized a beneficial
conversion feature of $5,955, representing the maximum amount of the intrinsic value of the conversion feature at the time of issuance.
This beneficial conversion feature was accreted to interest expense during the year ended September 30, 2018. In connection with
the above note, the Company recognized a beneficial conversion feature of $5,000, representing the maximum amount of the intrinsic
value of the conversion feature at the time of issuance. This beneficial conversion feature was accreted to interest expense during
the nine months ended June 30, 2019.
In January 2019, the Company issued a $10,000
in a convertible note payable to an entity related to the legal custodian of the Company. These notes bear interest at an annual
rate of 10% and are convertible to common shares of the Company at $0.0001 per share. As of June 30, 2019, $0 is outstanding in
principal and accrued interest. .In connection with the above note, the Company recognized a beneficial conversion feature of $10,000,
representing the maximum amount of the intrinsic value of the conversion feature at the time of issuance. This beneficial conversion
feature was accreted to interest expense during the nine months ended June 30, 2019.
In January 2019, 150,000,000 million shares
were issued in exchange for the cancellations of debt, $21,161 in convertible notes payable and accrued interest to an entity related
to the legal custodian of the Company.
In March 2019, the Company issued a $4,000
promissory note payable and a $2,794 promissory note payable to entities related to the legal custodian of the Company. These notes
bear interest at an annual rate of 10% and are payable on demand.
In June 2019, the Company issued a $5,000 promissory note
payable and a $354 promissory note payable to entities related to the legal custodian of the Company. These notes bear interest
at an annual rate of 10% and are payable on demand.
7
Other Contractual Obligations
As of the nine months ended June 30, 2019,
we do not have any contractual obligations other than the $12,148 in promissory notes payable to a legal custodian of the company
and related accrued interest on this note of $0.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Recently Issued Accounting Pronouncements
We review new accounting standards as issued.
Although some of these accounting standards issued or effective after the end of our previous fiscal year may be applicable to
the Company, we have not identified any standards that we believe merit further discussion. We do not expect the adoption of any
recently issued accounting pronouncements to have a significant impact on our financial position, results of operations, or cash
flows.
Going Concern
We have not attained profitable operations
and are dependent upon the continued financial support from our shareholders, the ability to raise equity or debt financing, and
the attainment of profitable operations from our future business. These factors raise substantial doubt regarding our ability to
continue as a going concern .
Our ability to continue as a going concern
is dependent upon our ability to generate future profitable operations and/or to obtain the necessary financing to meet our obligations
and repay our liabilities arising from normal business operations when they come due. Our ability to continue as a going concern
is also dependent on our ability to find a suitable target company and enter into a possible reverse merger with such company.
Management’s plan includes obtaining additional funds by equity financing through a reverse merger transaction and/or related
party advances; however there is no assurance of additional funding being available.
The Company, as of the date of this
filing had approximately $0 in cash and has not earned any revenues from operations to date. In the previous two fiscal years ended
September 30, 2018 and September 30, 2017 our expenses were $25,094 and $0 respectively, consisting primarily of professional fees,
administrative expenses and filing fees. In the previous two nine months ended June 30, 2019 and June 30, 2018 our expenses were
$30,276 and $1,949 respectively, consisting primarily of professional fees, administrative expenses and filing fees. The ongoing
expenses of the Company will be related to seeking out a suitable acquisition as well as mandatory filing requirements including
our reporting requirements under the Securities Exchange Act of 1934 upon effectiveness of this registration statement.
The Company continues to rely on borrowings
and financings either arranged by the Company’s President or through entities controlled by the President. In the next
12 months we expect to incur expenses equal to approximately $20,000 related to legal, accounting, audit, and other professional
service fees incurred in relation to the Company’s Exchange Act filing requirements. The costs related to the acquisition
of a business combination target company vary widely and are dependent on a variety of factors including, but not limited to, the
amount of time it takes to complete a business combination, the location of the target company, the size and complexity of the
business of the target company, whether stockholders of the Company prior to the transaction will retain equity in the Company,
the scope of the due diligence investigation required, the involvement of the Company’s auditors in the transaction, possible
changes in the Company’s capital structure in connection with the transaction, and whether funds may be raised contemporaneously
with the transaction. Therefore, we believe such costs are unascertainable until the Company identifies a business combination
target. These conditions raise substantial doubt about our ability to continue as a going concern. The Company is currently devoting
its efforts to locating merger candidates. The Company’s ability to continue as a going concern is dependent upon our ability
to develop additional sources of capital, locate and complete a merger with another company, and ultimately, achieve profitable
operations.
The Company may consider a business which has
recently commenced operations, is a developing company in need of additional funds for expansion into new products or markets,
is seeking to develop a new product or service, or is an established business which may be experiencing financial or operating
difficulties and is in need of additional capital. Our management believes that the public company status that results from a combination
with the Company will provide such company greater access to the capital markets, increase its visibility in the investment community,
and offer the opportunity to utilize its stock to make acquisitions. There is no assurance that we will in fact have access to
additional capital or financing as a public company. In the alternative, a business combination may involve the acquisition of,
or merger with, a company which does not need substantial additional capital, but which desires to establish a public trading market
for its shares, while avoiding, among other things, the time delays, significant expense, and loss of voting control which may
occur in a public offering.
8
Our officers and directors have not had any
preliminary contact or discussions with any representative of any other entity regarding a business combination with us. Any target
business that is selected may be a financially unstable company or an entity in its early stages of development or growth, including
entities without established records of sales or earnings. In that event, we will be subject to numerous risks inherent in the
business and operations of financially unstable and early stage or potential emerging growth companies. In addition, we may effect
a business combination with an entity in an industry characterized by a high level of risk, and, although our management will endeavor
to evaluate the risks inherent in a particular target business, there can be no assurance that we will properly ascertain or assess
all significant risks.
Our management anticipates that it will likely
be able to effect only one business combination, due primarily to our limited financing and the dilution of interest for present
and prospective stockholders, which is likely to occur as a result of our management’s plan to offer a controlling interest
to a target business in order to achieve a tax-free reorganization. This lack of diversification should be considered a substantial
risk in investing in us, because it will not permit us to offset potential losses from one venture against gains from another.
The Company anticipates that the selection
of a business combination will be complex and extremely risky. While the Company is in a competitive market with a small number
of business opportunities, through information obtained from industry professionals including attorneys, investment bankers, and
other consultants with experience in the reverse merger industry, our management believes that there are opportunities for a business
combination with firms seeking the perceived benefits of becoming a publicly traded corporation. Such perceived benefits of becoming
a publicly traded corporation include, among other things, facilitating or improving the terms on which additional equity financing
may be obtained, providing liquidity for the principals of and investors in a business, creating a means for providing incentive
stock options or similar benefits to key employees, and offering greater flexibility in structuring acquisitions, joint ventures
and the like through the issuance of stock. Potentially available business combinations may occur in many different industries
and at various stages of development, all of which will make the task of comparative investigation and analysis of such business
opportunities extremely difficult and complex.
We do not currently intend to retain any entity
to act as a “finder” to identify and analyze the merits of potential target businesses.
We have not established a specific timeline
nor have we created a specific plan to identify an acquisition target and consummate a business combination. We expect that our
management and the Company, through its various contacts and affiliations with other entities will locate a business combination
target. We expect that funds in the amount of approximately $20,000 will be required in order for the Company to satisfy its Exchange
Act reporting requirements during the next 12 months, in addition to any other funds that will be required in order to complete
a business combination. Such funds can only be estimated upon identifying a business combination target. Our management and stockholders
have indicated an intent to advance funds on behalf of the Company as needed in order to accomplish its business plan and comply
with its Exchange Act reporting requirements, however, there are no agreements in effect between the Company and our management
or stockholders specifically requiring they provide any funds to the Company. Therefore, there are no assurances that the Company
will be able to obtain the required financing as needed in order to consummate a business combination transaction.
Item 3. Properties.
The Company neither rents nor owns any properties.
The Company utilizes the office space and equipment of its President at no cost. Given the limited need of the Company, management
believes that the office space is more than suitable and adequate. The Company currently has no policy with respect to investments
or interests in real estate, real estate mortgages or securities of, or interests in, persons primarily engaged in real estate
activities.
Item 4. Security Ownership of Certain
Beneficial Owners and Management.
Principal Stockholders
The following table sets forth, as of June
30, 2019, the number of shares of Common Stock owned of record and beneficially by executive officers, directors and persons who
beneficially own more than 5% of the outstanding shares of Common Stock of the Company.
Beneficial Owner
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Number of Shares Beneficially Owned
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Percent
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Alden Worldwide, Inc.1
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18,700,000
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6.98
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%
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Allan Muller2
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48,750,000
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18.21
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%
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Tourmeline Ventures, Inc.3
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150,000,000
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56.04
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%
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Named Executive Officers and Directors:
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Anthony Lombardo, Chief Executive Officer, Secretary and Director
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0
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0
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%
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All executive officers and directors as a group (1 person)
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0
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0
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%
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1.)
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The beneficial owner of Alden Worldwide, Inc., neither Management nor the Custodian have been able to locate any natural person
related to it including any of its beneficial owners. As part of its compliance with Nevada’s “Custodian Statute,”
the Custodian sent a letter to the last known address which was PH Plaza, 2000 Building 50 th ST 16 FL, Panama City, Panama and
the correspondence was returned unopened “return to sender.”
|
|
2.)
|
Alan Muller’s address is 46D Tohunga Crescent Parnell, Aukland, New Zealand 1052.
|
|
3.)
|
Tourmeline Ventures, Inc. is beneficially owned by Joseph Passalaqua. The company’s address is 1919 NW 19th
St. Suite 3, Ft. Lauderdale, FL 33311.
|
9
Item 5. Directors and Executive Officers.
Our Board of Directors
The following table sets forth information regarding our current
directors and each director nominee, as of June 30, 2019.
Name
|
|
Position
|
|
Age
|
|
Director Since
|
Anthony Lombardo*
|
|
|
Director
|
|
|
|
58
|
|
|
|
2018
|
|
*The address for Mr. Lombardo is 3512 Desert Mesa Road,
Roanoke, TX 76262
Anthony Lombardo
Anthony Lombardo, 58, Serves as
our sole member of the board of directors, Chief Executive Officer, Chief Financial Officer and Secretary. He has served
in these positions since being appointed by the Custodian following the judicial appointment of Custodial Management, LLC as the
Company’s Custodian in February 2018. Prior to joining Gryphon Resources, Inc., from January 2018 until the present, Mr.
Lombardo has served as the General Sales Manager in charge of selling pre-owned vehicles for Clebourne Auto Ranch. Prior to joining
Clebourne Auto Ranch, from January 1, 2015 through January 2018, he was in charge of day to day sales of used vehicles for
Novak Motors where he managed a staff of 7 sales personnel and sold an average of 120-240 cars per month.
Our Executive Officers
We designate persons serving in the following positions as our named
executive officers: our chief executive officer, chief financial officer. The following table sets forth information regarding
our executive officers as of June 30, 2019
Name
|
|
Principal Occupation
|
|
Age
|
|
Officer Since
|
Anthony Lombardo
|
|
Chief Executive Officer, Chief Financial Officer
and Secretary
|
|
|
58
|
|
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony Lombardo ’s biographical summary
is included under “Our Board of Directors.”
The CEO of Custodial Management, LLC, Joseph
Passalaqua appointed Mr. Lombardo to his positions with the Company. Mr. Passalaqua owned five General Motors dealerships and
Mr. Lombardo had managed those dealerships for several years until they were sold in 2008. Mr. Passalaqua had maintained contact
with Mr. Lombardo, knew him to be an exceptional manager and, as CEO of the Custodian, was looking for someone to manage the Company
during and after the Custodial Management, LLC /Gryphon Resources, Inc. Judicial Proceedings were completed. Mr. Lombardo agreed
and he was appointed to the Company’s board of directors and as its sole officer.
10
Item 6. Executive Compensation.
Summary Compensation Table
The following table sets forth
information concerning the compensation of our principal executive officer, our principal financial officer and each of our other
executive officers during 2018 and 2017
. Name and Principal Position
|
|
Fiscal
Year
|
|
Salary
($)
|
|
Bonus
($)
|
|
Stock
Awards
($)
|
|
Option
Awards
($)
|
|
Nonequity
Incentive
Plan
Compen-
sation ($)
|
|
Non-
Qualified
Deferred
Compen-
sation
Earnings
($)
|
|
All
Other
Compen-
sation
($)
|
|
Total
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Anthony Lombardo
|
|
|
2017
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
(Principal Chief Executive Officer, Chief Financial Officer, Secretary and Director)
|
|
|
2018
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employment Agreements
The Company does not have employment
agreements with any of its officers or directors and there are no other employees.
Directors Compensation
No director received compensation for services
rendered in any capacity to us during the fiscal years ended September 30, 2017 and September 30, 2018. No director received compensation
for services rendered in any capacity to us during the nine months ended June 30, 2018 and June 30, 2019.
Indemnification of Directors and Officers
Our Articles of Incorporation, as amended and
restated, and our Bylaws provide for mandatory indemnification of our officers and directors, except where such person has been
adjudicated liable by reason of his negligence or willful misconduct toward the Company or such other corporation in the performance
of his duties as such officer or director. Our Bylaws also authorize the purchase of director and officer liability insurance to
insure them against any liability asserted against or incurred by such person in that capacity or arising from such person's status
as a director, officer, employee, fiduciary, or agent, whether or not the corporation would have the power to indemnify such person
under the applicable law.
Compensation Committee Interlocks and Insider
Participation
We have not established a compensation committee.
We are not currently subject to any law, rule or regulation requiring that we establish a compensation committee.
11
Item 7. Certain Relationships and Related Transactions.
During the Company’s 2018 and 2017 fiscal
years ending September 30th, the Company had no sales of unregistered securities: In January 2019, the Company issued
150,000,000 shares in connection with the conversion of 3 convertible notes payable entered into with the Tourmeline Ventures,
Inc., a company owned by the CEO and principal shareholder of the custodian for advances made by Tourmeline Ventures, Inc. bringing
the Company in compliance with its filing obligations, consistent with the Court Order appointing the Custodian. These notes are
attached hereto as Exhibits 10.1, 10.2 and 10.3. The convertible notes payable bore simple interest at a rate of 10% per annum.
As of the date that the notes were converted they represented $20,955 in principal such that together with interest of $206 the
total purchase price for the aforementioned shares was $21,161; so the total consideration paid for the 150 million shares on conversion
was $21,161 or $0.00141 per share. The shares were issued under the exemptions from registration based on Section 4(2) of the Securities
Act of 1933, as amended as to the sale of the convertible notes as not being in a public offering and then on conversion, based
on Section 3(a)9 of the Securities Act of 1933, as amended. In addition Tourmeline Ventures, Inc. advanced additional funds required
by the Custodian for additional expenses of the Company as part of the expenses of the custodianship. These funds were advanced
under four promissory notes that bear simple interest at 10% per annum and total $12,418.31. They were issued under Section 4(2)
of the Securities Act of 1933, as amended, like the aforementioned 3 convertible promissory notes as they were not made in a public
offering. These notes are attached hereto as Exhibits 10.4 – 10.7.
Other than as described herein, none of our
directors or executive officers, nor any person who beneficially owns, directly or indirectly, shares carrying more than five percent
of the voting rights attached to all of our outstanding shares, nor any members of the immediate family (including spouse, parents,
children, siblings, and in- laws) of any of the foregoing persons has any material interest, direct or indirect, in any transaction
over the last two years or in any presently proposed transaction which, in either case, has or will materially affect us.
We do not have a specific policy or procedure
for the review, approval, or ratification of any transaction involving related persons. We historically have sought and obtained
funding from officers, directors, and family members as these categories of persons are familiar with our management and often
provide better terms and conditions than we can obtain from unassociated sources. Also, we are so small that having specific policies
or procedures of this type would be unworkable.
Item 8. Legal Proceedings.
On February 21, 2018, one of the Company’s
shareholders made a motion and application to be appointed as custodian of the Company based on prior management abandoning its
responsibilities to continue making filings at the Nevada Secretary of State’s office and for failing to hold a shareholders’
meeting in over 6 years and otherwise failing to keep current in its obligations to the Company. Upon motion and application
to the District Court, Clark County Nevada, the Court granted the shareholder’s request and the shareholder was appointed
as custodian for the Company (“Custodian”). As Custodian of the Company, the shareholder was ordered to file an amendment
to the Company’s articles of incorporation which was filed in conformity with N.R.S. 78.347(4) and the shareholder was ordered
to have the Company’s charter reinstated in Nevada, to notice and hold a shareholder meeting; to provide a report to the
Court of the actions taken at the shareholder meeting; to identify and name a new registered agent in the State of Nevada; to reinstate
the Company in the State of Nevada; and the Custodian. In addition to the aforementioned items set forth in the Order Appointing
the Custodian, the Custodian was given the power and authority to take any action it deemed reasonable and for the benefit of the
Company and its shareholders. The Custodian is now in the process of meeting all of the requirements set forth in the Court
Order and filing a motion to terminate its services. Upon granting the motion, the Court will issue an Order acknowledging
that the Custodian has performed all of the duties that had been required of it and the management of the Company will revert exclusively
to the officers and directors appointed by the Custodian. A Copy of the Order Appointing the Custodian is furnished with this Registration
Statement as Exhibits 99.1.
There were no other legal proceedings threatened
or otherwise.
12
Item 9. Market Price of, and Dividends on, the
Registrant’s Common Equity and Related Stockholder Matters.
(a) Market Information
Our common stock trades on the OTC PINK Exchange
under the ticker symbol “GRYO” The following table sets forth, for the periods indicated, the high and low closing
sales prices of our common stock (where the end of the quarter was on a weekend or holiday and in cases where there was otherwise
no trading activity, the high and low prices nearest and prior to the date have been used):
FISCAL YEAR ENDED SEPTEMBER 30, 2017:
|
|
High
|
|
Low
|
|
June 30, 2017
|
|
|
$
|
0.0010
|
|
|
$
|
0.0010
|
|
|
September 30, 2017
|
|
|
$
|
0.0006
|
|
|
$
|
0.0006
|
|
|
December 31. 2017
|
|
|
$
|
0.0022
|
|
|
$
|
0.0017
|
|
|
March 31, 2018
|
|
|
$
|
0.0040
|
|
|
$
|
0.0040
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FISCAL YEAR ENDED SEPTEMBER 30, 2018:
|
|
|
|
|
|
|
|
|
|
|
June 30, 2018
|
|
|
$
|
0.0031
|
|
|
$
|
0.0031
|
|
|
September 30, 2018
|
|
|
$
|
0.0048
|
|
|
$
|
0.0038
|
|
|
December 31, 2018
|
|
|
$
|
0.0055
|
|
|
$
|
0.0032
|
|
|
March 31, 2019
|
|
|
$
|
0.0084
|
|
|
$
|
0.0061
|
|
(b) Holders
As of September 13, 2019, there were approximately
8 holders of record of our common stock, not including holders who hold their shares in street name and as of the same date 47.899.925
shares are held in “street name,” largely from the Company’s initial registration.
(c) Dividends
The Company has never declared or paid any
cash dividends. It is the present policy of the Company to retain earnings to finance the growth and development of the business
and, therefore, the Company does not anticipate paying dividends on its Common Stock in the foreseeable future.
(d) Equity Compensation Plan Information
The Company does not currently have an equity compensation
plan but intends to adopt one in the future. In lieu of an equity compensation plan the Company has granted shares of restricted
stock to its officers, directors and others for services periodically and as part of some of the officers’ employment agreements.
(e) Information Related to Outstanding Shares
As of September 13, 2019 there were 267,675,000 shares of our common
stock issued and outstanding.
All of our issued and outstanding common shares
(of which 0 shares are owned by officers, directors) were issued and have been paid for and held for a period in excess of
six months and are eligible to be resold pursuant to Rule 144 promulgated under the Securities Act when the Company has been reporting
for 1 year and has ceased being a “shell company” as defined by Rule 144(i).
The resale of our shares of common stock owned
by officers, directors and affiliates is subject to the volume limitations of Rule 144. In general, Rule 144 permits our affiliate
shareholders who have beneficially-owned restricted shares of common stock for at least six months to sell without registration,
within a three-month period, a number of shares not exceeding one percent of the then outstanding shares of common stock. Furthermore,
if such shares are held for at least six months by a person not affiliated with the company (in general, a person who is not one
of our executive officers, directors or principal shareholders during the three month period prior to resale), such restricted
shares can be sold without any volume limitation, provided all of the other requirements for resale under Rule 144 are applicable.
Further, as a “shell company” holders of our restricted shares will not be able to sell those shares in reliance on
Rule 144 until such time as the Company has ceased being a shell company, is a reporting company under the Securities Exchange
Act of 1934, as amended and has filed all required reports for 12 consecutive months.
13
Item 10. Recent Sales of
Unregistered Securities.
During the Company’s 2018 and 2017 fiscal
years ending September 30th, the Company had no sales of unregistered securities: In January 2019, the Company issued
150,000,000 shares in connection with the conversion of 3 convertible notes payable entered into with the Tourmeline Ventures,
Inc., a company owned by the CEO and principal shareholder of the custodian for advances made by Tourmeline Ventures, Inc. bringing
the Company in compliance with its filing obligations, consistent with the Court Order appointing the Custodian. These notes are
attached hereto as Exhibits 10.1, 10.2 and 10.3. The convertible notes payable bore simple interest at a rate of 10% per annum.
As of the date that the notes were converted they represented $20,955 in principal such that together with interest of $206 the
total purchase price for the aforementioned shares was $21,161; so the total consideration paid for the 150 million shares on conversion
was $21,161 or $0.00141 per share. The shares were issued under the exemptions from registration based on Section 4(2) of the Securities
Act of 1933, as amended as to the sale of the convertible notes as not being in a public offering and then on conversion, based
on Section 3(a)9 of the Securities Act of 1933, as amended. In addition Tourmeline Ventures, Inc. advanced additional funds required
by the Custodian for additional expenses of the Company as part of the expenses of the custodianship. These funds were advanced
under four promissory notes that bear simple interest at 10% per annum and total $12,418.31. They were issued under Section 4(2)
of the Securities Act of 1933, as amended, like the aforementioned 3 convertible promissory notes as they were not made in a public
offering. These notes are attached hereto as Exhibits 10.4 – 10.7.
During the Company’s nine months ending
June 30th , the Company had no sales of unregistered securities:
Note that due to the price differential between
the conversion price on certain notes and the most recent market prices, the Company’s auditor required it to take one time
non-cash charges deemed “beneficial conversions” despite the fact that no conversions had taken place. This is
simply an accounting convention designed to capture the expense to a Company for issuing shares below deemed market value, notwithstanding
the fact that there was an extremely limited market for the Company’s common stock when the convertible notes were entered
into and the fact that the shares were not actually issued at the time.
Item 11. Description of Registrant’s Securities
to be Registered.
DESCRIPTION OF SECURITIES
The authorized capital stock of Gryphon
Resources, Inc. consists of 400,000,000 shares of Common Stock, $0.001 par value per share (the “Common Stock”), As
of June 30, 2019 there were 267,675,000 shares of Common Stock issued and outstanding and no shares of Preferred Stock issued and
outstanding.
The following description of certain
matters relating to Gryphon Resources, Inc. securities is a summary and is qualified in its entirety by the provisions of Gryphon
Resources, Inc. Articles of Incorporation, the Amendments to the Articles of Incorporation and Bylaws.
Common Stock
The holders of our common stock are
entitled to one vote per share on all matters submitted to a vote of our stockholders. The holders of the common stock have the
sole right to vote, except as otherwise provided by law, by our articles of incorporation, or in a statement by our board of directors
in a Preferred Stock Designation.
In addition, such holders are entitled
to receive ratably such dividends, if any, as may be declared from time to time by our board of directors out of legally available
funds.
The holders of the common stock do not have
cumulative voting rights or preemptive rights to acquire or subscribe for additional, unissued or treasury shares in accordance
with the laws of the State of Nevada. Accordingly, the holders of more than 50 percent of the issued and outstanding shares of
the common stock voting for the election of directors can elect all of the directors if they choose to do so, and in such event,
the holders of the remaining shares of the common stock voting for the election of the directors will be unable to elect any person
or persons to the board of directors. All outstanding shares of the common stock are fully paid and nonassessable.
The laws of the State of Nevada provide
that the affirmative vote of a majority of the holders of the outstanding shares of our common stock and is required to authorize
any amendment to our articles of incorporation, any merger or consolidation of Gryphon Resources, Inc. with any corporation, or
any liquidation or disposition of any substantial assets of Gryphon Resources, Inc..
Preferred Stock
The Company has no authorized shares of Preferred
Stock..
Options
The Company has not issued any options
to purchase shares of its common stock, although it may establish a qualified option plan at some point in the future.
14
Item 12. Indemnification of Directors
and Officers.
Our articles provide to the fullest
extent permitted by Nevada law, that our directors or officers shall not be personally liable to the Company or our stockholders
for damages for breach of such director’s or officer’s fiduciary duty. The effect of this provision of our
articles is to eliminate our rights and the rights of our stockholders (through stockholders’ derivative suits on behalf
of the Company) to recover damages against a director or officer for breach of the fiduciary duty of care as a director or officer
(including breaches resulting from negligent or grossly negligent behavior), except under certain situations defined by statute. We
believe that the indemnification provisions in our articles are necessary to attract and retain qualified persons as directors
and officers.
Nevada corporate law provides that
a corporation may indemnify a director, officer, employee or agent made a party to an action by reason of that fact that he was
a director, officer employee or agent of the corporation or was serving at the request of the corporation against expenses actually
and reasonably incurred by him in connection with such action if he acted in good faith and in a manner he reasonably believed
to be in, or not opposed to, the best interests of the corporation and with respect to any criminal action, had no reasonable cause
to believe his conduct was unlawful.
Item 13. Financial Statements and
Supplementary Data.
Report of Independent Registered Public Accounting Firm
|
|
|
|
|
|
|
|
|
|
Balance Sheets
|
|
|
|
|
|
|
|
|
|
Statements of Operations
|
|
|
|
|
|
|
|
|
|
Statements of Stockholders' Deficit
|
|
|
|
|
|
|
|
|
|
Statements of Cash Flows
|
|
|
|
|
|
|
|
|
|
Notes to the Financial Statements
|
|
|
|
|
The financial statements required
to be included in this registration statement appear at the end of the registration statement beginning on page F-1. (see Item
15).
Item 14. Changes in and Disagreements
with Accountants on Accounting and Financial Disclosure.
There are not and have not been any
disagreements between us and our accountants on any matter of accounting principles, practices or financial statement disclosure.
15
Item 15. Financial Statements and
Exhibits.
See the financial
statements annexed to this Registration Statement which financial statements are incorporated herein by reference.
See below.
The following
documents are filed as exhibits hereto:
________________
16
SIGNATURES
Pursuant to the requirements
of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized.
|
|
|
GRYPHON RESOURCES, INC.
|
|
|
By:
|
|
/s/ Anthony Lombardo
|
|
|
Name: Anthony Lombardo
Title: President and Director
Date: September 19, 2019
|
17
Boyle CPA, LLC
Certified Public Accountants & Consultants
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
To the Shareholders and
Board of Directors of Gryphon Resources, Inc.
Opinion on the Financial Statements
We have audited the accompanying balance sheets
of Gryphon Resources, Inc. (the “Company”) as of September 30, 2018 and 2017, the related statements of operations,
stockholder’s deficit, and cash flows for each of the years in the two-year period ended September 30, 2018, and the related
notes (collectively referred to as the “financial statements”). In our opinion, the financial statements
present fairly, in all material respects, the financial position of the Company as of September 30, 2018 and 2017, and the results
of its operations and its cash flows for each of the years in the two-year period ended September 30, 2018, in conformity with
accounting principles generally accepted in the United States of America.
Basis of Opinion
These financial statements are the responsibility
of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements
based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United
States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with U.S. federal securities
laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with
standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to
fraud or error. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial
reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but
not for the purpose of expressing and opinion on the effectiveness of the Company’s internal control over financial reporting.
Accordingly, we express no such opinion.
Our audits included performing procedures to
assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures
that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures
in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made
by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a
reasonable basis for our opinion.
Substantial Doubt About the Company’s Ability to Continue
as a Going Concern
As discussed in Note 2 to the financial statements,
the Company’s lack of revenues, accumulated deficit and inability to generate positive cash flows raise substantial doubt
about its ability to continue as a going concern for one year from the issuance of these financial statements. Management’s
plans are also described in Note 2. The financial statements do not include adjustments that might result from the outcome of this
uncertainty.
/s/ Boyle CPA, LLC
We have served as the Company’s auditor since 2018
July 3, 2019
Boyle CPA, LLC
361 Hopedale Drive SE
Bayville, NJ 08721
P (732) 822-4427
F (732) 510-0665
18
Gryphon Resources, Inc.
|
BALANCE SHEETS
|
|
|
|
|
|
|
|
September 30,
|
|
September 30,
|
|
|
2018
|
|
2017
|
ASSETS
|
|
|
|
|
Current Assets:
|
|
|
|
|
Cash
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Current Assets
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES & STOCKHOLDER'S DEFICIT
|
|
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
|
|
|
|
Accounts Payable
|
|
$
|
16,139
|
|
|
$
|
—
|
|
Accounts Payable - Related Party
|
|
|
3,000
|
|
|
|
—
|
|
Notes Payable - Related Party
|
|
|
5,955
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Total Current Liabilities
|
|
|
25,094
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
25,094
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholder's Deficit
|
|
|
|
|
|
|
|
|
Common Stock, par value $0.001,
|
|
|
|
|
|
|
|
|
400,000,000 shares Authorized, 117,675,000 shares Issued and
|
|
|
|
|
|
|
|
|
Outstanding at September 30, 2018 and September 30, 2017
|
|
|
117,675
|
|
|
|
117,675
|
|
Additional Paid-In Capital
|
|
|
573,109
|
|
|
|
567,154
|
|
Accumulated Deficit
|
|
|
(715,878
|
)
|
|
|
(684,829
|
)
|
|
|
|
|
|
|
|
|
|
Total Stockholder's Deficit
|
|
|
(25,094
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDER'S DEFICIT
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these audited financial statements
|
|
|
|
|
|
|
|
|
|
19
Gryphon Resources, Inc.
|
STATEMENTS
OF OPERATION
|
|
|
|
|
|
|
|
For the Year Ended
|
|
|
September 30,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
Professional fees
|
|
|
17,489
|
|
|
|
—
|
|
General and administrative expense
|
|
|
7,605
|
|
|
|
—
|
|
Total Operating Expenses
|
|
|
25,094
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Operating Loss
|
|
|
(25,094
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Other Expense
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
5,955
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
(31,049
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Basic & Diluted Loss per Common Share
|
|
$
|
(0.00
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Common Shares
|
|
|
|
|
|
|
|
|
Outstanding
|
|
|
117,675,000
|
|
|
|
117,675,000
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these audited financial statements
|
20
Gryphon Resources, Inc.
|
STATEMENT OF STOCKHOLDERS' DEFICIT
|
|
|
Common Stock
|
|
Additional
|
|
|
|
Total
|
|
|
Shares
|
|
Par Value
|
|
Paid-In Capital
|
|
Accumulated Deficit
|
|
Stockholders' Deficiency
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of September 30, 2016
|
|
|
117,675,000
|
|
|
$
|
117,675
|
|
|
$
|
567,154
|
|
|
$
|
(684,829
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of September 30, 2017
|
|
|
117,675,000
|
|
|
|
117,675
|
|
|
|
567,154
|
|
|
|
(684,829
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beneficial Conversion Feature
|
|
|
—
|
|
|
|
—
|
|
|
|
5,955
|
|
|
|
—
|
|
|
|
5,955
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(31,049
|
)
|
|
|
(31,049
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of September 30, 2018
|
|
|
117,675,000
|
|
|
$
|
117,675
|
|
|
$
|
573,109
|
|
|
$
|
(715,878
|
)
|
|
$
|
(25,094
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these audited financial statements
|
21
Gryphon Resources, Inc.
|
STATEMENT OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
|
September 30,
|
|
|
2018
|
|
2017
|
CASH FLOWS FROM OPERATING
|
|
|
|
|
|
|
|
|
ACTIVITIES:
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(31,049
|
)
|
|
$
|
—
|
|
Adjustments to reconcile net loss to net cash
|
|
|
|
|
|
|
|
|
used in operating activities:
|
|
|
|
|
|
|
|
|
Benefical Conversion Feature
|
|
|
5,955
|
|
|
|
|
|
Changes In:
|
|
|
|
|
|
|
|
|
Accounts Payable
|
|
|
16,139
|
|
|
|
—
|
|
Accounts Payable - Related Party
|
|
|
3,000
|
|
|
|
—
|
|
Net Cash Used in Operating Activities
|
|
|
(5,955
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING
|
|
|
|
|
|
|
|
|
Proceeds from Note Payable - Related Party
|
|
|
5,955
|
|
|
|
—
|
|
Net Cash Provided by Financing Activities
|
|
|
5,955
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Net (Decrease) Increase in Cash
|
|
|
—
|
|
|
|
|
|
Cash at Beginning of Period
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Cash at End of Period
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
Cash paid during the year for:
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
—
|
|
|
$
|
—
|
|
Franchise Taxes
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
None.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these audited financial statements
|
22
GRYPHON RESOURCES, INC.
NOTES TO FINANCIAL STATEMENTS
September 30, 2018
Note 1. Organization and Description of
Business
The Company is not currently engaged in any
business operations. It is, however, in the process of attempting to identify, locate, and if warranted, acquire new commercial
opportunities.
Note 2. Going Concern Uncertainties
The Company has not generated any revenues,
has an accumulated deficit of $715,878 as of September 30, 2018, and does not have positive cash flows from operating activities.
The Company expects to incur additional losses as it continues to identify and develop new commercial opportunities. The Company
will be subject to the risks, uncertainties, and difficulties frequently encountered by early-stage companies. The Company may
not be able to successfully address any or all of these risks and uncertainties. Failure to adequately do so could cause the Company’s
business, results of operations, and financial condition to suffer. These conditions raise substantial doubt about the Company’s
ability to continue as a going concern for a period of one year from the issuance date of these financial statements.
The Company’s ability to continue as
a going concern is an issue due to its net losses and negative cash flows from operations, and its need for additional financing
to fund future operations. Management plans to identify commercial opportunities and to obtain necessary funding from outside sources.
There can be no assurance that such funds, if available, can be obtained on terms reasonable to the Company. The accompanying financial
statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that
may result from the outcome of this uncertainty. Based on the Company’s current level of expenditures, management believes
that cash on hand is adequate to fund operations for at least the next twelve months.
Note 3. Summary of Significant Accounting
Policies
Basis of Presentation
The accompanying financial statements have
been prepared in accordance with U.S. GAAP.
Estimates
The preparation of financial statements in
conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities,
and expenses during the reporting period. On an on-going basis, the Company evaluates its estimates. Actual results and outcomes
may differ materially from the estimates as additional information becomes known
Cash and Cash Equivalents
Cash and cash equivalents includes highly liquid investments with
original maturities of three months or less. On occasion, the Company has amounts deposited with financial institutions
in excess of federally insured limits.
Fair Value of Financial Instruments
The Company measures certain financial assets
and liabilities at fair value based on the exchange price that would be received for an asset or paid to transfer a liability (an
exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants.
The carrying value of cash and cash equivalents and accounts payable approximate their fair value because of the short-term nature
of these instruments and their liquidity. Management is of the opinion that the Company is not exposed to significant interest
or credit risks arising from these financial instruments.
Income Taxes
Deferred income tax assets and liabilities
are determined based on the estimated future tax effects of net operating loss and credit carryforwards and temporary differences
between the tax basis of assets and liabilities and their respective financial reporting amounts measured at the current enacted
tax rates. The Company records an estimated valuation allowance on its deferred income tax assets if it is not more likely than
not that these deferred income tax assets will be realized.
23
The Company recognizes a tax benefit from an
uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities,
based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are
measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. As of
September 30, 2018 and 2017, the Company has not recorded any unrecognized tax benefits. See Note 6. Income Taxes.
Segment Reporting
The Company’s business currently operates
in one segment.
Net Loss per Share
The computation of basic net loss per common
share is based on the weighted average number of shares that were outstanding during the year. The computation of diluted net loss
per common share is based on the weighted average number of shares used in the basic net loss per share calculation plus the number
of common shares that would be issued assuming the exercise of all potentially dilutive common shares outstanding using the treasury
stock method. See Note 4. Net Loss Per Share.
Recently Issued Accounting Pronouncements
The Company reviews new accounting standards
as issued. Although some of these accounting standards issued or effective after the end of the Company’s previous fiscal
year may be applicable to the Company, it has not identified any standards that it believes merit further discussion. The Company
does not expect the adoption of any recently issued accounting pronouncements to have a significant impact on its financial position,
results of operations, or cash flows.
Note 4. Net Loss Per Share
During the years ended September 30, 2018 and 2017, the Company
recorded a net loss. The Company does not have any potentially dilutive securities outstanding. Therefore, basic and diluted net
loss per share is the same for those periods.
Note 5. Related Party
In September 2018, the Company incurred a related
party payable in the amount of $3,000 to an entity related to the legal custodian of the Company for professional fees . As of
September 30, 2018, a balance of $3,000 remained outstanding.
On September 30, 2018, the Company issued a
$5,955 in a convertible note payable to an entity related to the legal custodian of the Company. The note bears interest at an
annual rate of 10% and is convertible to common shares of the Company at $0.0001 per share. As of September 30, 2018, $5,955 of
the principal balance remained outstanding on the note payable and $0.
In connection with the above note, the Company recognized a beneficial
conversion feature of $5,955, representing the maximum amount of the intrinsic value of the conversion feature at the time of issuance.
This beneficial conversion feature was accreted to interest expense during the year ended September 30, 2018.
Note 6. Income Taxes
Deferred income taxes reflect the net tax effects
of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts
used for income tax purposes. Significant components of the Company’s deferred tax assets at September 30, 2018 and 2017
are as follows:
|
|
Year Ended
|
|
|
September 30,
|
|
|
2018
|
|
2017
|
Deferred tax assets:
|
|
|
|
|
|
|
|
|
Net operating loss carryforwards
|
|
$
|
250,557
|
|
|
$
|
250,557
|
|
|
|
|
|
|
|
|
|
|
Total deferred tax assets
|
|
|
250,557
|
|
|
|
250,557
|
|
|
|
|
|
|
|
|
|
|
Less: valuation allowance
|
|
|
(250,557
|
)
|
|
|
(250,557
|
)
|
|
|
|
|
|
|
|
|
|
Net deferred tax asset
|
|
$
|
—
|
|
|
$
|
—
|
|
24
The net increase in the valuation allowance
for deferred tax assets was $10,867 and $0 for the years ended September 30, 2018 and 2017. The Company evaluates its valuation
allowance on an annual basis based on projected future operations. When circumstances change and this causes a change in management’s
judgment about the realizability of deferred tax assets, the impact of the change on the valuation allowance is reflected in current
operations.
For federal income tax purposes, the Company
has net U.S. operating loss carry forwards at September 30, 2018 available to offset future federal taxable income, if any, of
$715,878, which will fully expire by the fiscal year ended September 30, 2038. Accordingly, there is no current tax expense
for the years ended September 30, 2018 and 2017.
The utilization of the tax net operating loss
carry forwards may be limited due to ownership changes that have occurred as a result of sales of common stock.
The effects of state income taxes were insignificant
for the years ended September 30, 2018 and 2017.
The following is a reconciliation between expected
income tax benefit and actual, using the applicable statutory income tax rate of 34% for the years ended September 30, 2018 and
2017:
|
|
Year Ended
|
|
|
September 30,
|
|
|
2018
|
|
2017
|
|
|
|
|
|
Income tax benefit at statutory rate
|
|
$
|
10,867
|
|
|
$
|
—
|
|
Change in valuation allowance
|
|
|
(10,867
|
)
|
|
|
(—)
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
The fiscal years 2012 through 2018 remain open to examination by
federal authorities and other jurisdictions in which the Company operates.
On December 22, 2017, the Tax Cuts and Jobs
Act was enacted. This law substantially amended the Internal Revenue Code, including reducing the U.S. corporate tax rates.
Upon enactment, the Company’s deferred tax asset and related valuation allowance decreased by $110,223 to $150,334. As the
deferred tax asset is fully allowed for, this change in rates had no impact on the Company’s financial position or results
of operations.
Note 7. Subsequent Events
None.
25
Gryphon Resources , Inc.
|
BALANCE SHEETS
|
(Unaudited)
|
|
|
June 30,
|
|
September 30,
|
|
|
2019
|
|
2018
|
ASSETS
|
|
|
|
|
Current Assets:
|
|
|
|
|
|
|
|
|
Cash
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Current Assets
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES & STOCKHOLDER'S DEFICIT
|
|
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
|
|
|
|
Accounts Payable
|
|
$
|
6,359
|
|
|
$
|
16,139
|
|
Accounts Payable - Related Party
|
|
|
500
|
|
|
|
3,000
|
|
Interest Payable - Related Party
|
|
|
202
|
|
|
|
—
|
|
Notes Payable - Related Party
|
|
|
12,148
|
|
|
|
5,955
|
|
|
|
|
|
|
|
|
|
|
Total Current Liabilities
|
|
|
19,209
|
|
|
|
25,094
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
|
|
|
19,209
|
|
|
|
25,094
|
|
|
|
|
|
|
|
|
|
|
Stockholder's Deficit
|
|
|
|
|
|
|
|
|
Common Stock, par value $0.001,
|
|
|
|
|
|
|
|
|
400,000,000 shares Authorized, 267,675,000 shares Issued and
|
|
|
|
|
|
|
|
|
Outstanding at June 30, 2019 and 117,675,000 at September 30, 2018
|
|
|
267,675
|
|
|
|
117,675
|
|
Additional Paid-In Capital
|
|
|
459,270
|
|
|
|
573,109
|
|
Accumulated Deficit
|
|
|
(746,154
|
)
|
|
|
(715,878
|
)
|
|
|
|
|
|
|
|
|
|
Total Stockholder's Deficit
|
|
|
(19,209
|
)
|
|
|
(25,094
|
)
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDER'S DEFICIT
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these unaudited financial statements
|
26
Gryphon Resources, Inc.
|
STATEMENTS OF OPERATIONS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended
|
|
For the Nine Months Ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Professional fees
|
|
|
1,362
|
|
|
|
1,949
|
|
|
|
13,369
|
|
|
|
1,949
|
|
General and administrative expense
|
|
|
415
|
|
|
|
—
|
|
|
|
1,499
|
|
|
|
—
|
|
Total Operating Expenses
|
|
|
1,777
|
|
|
|
1,949
|
|
|
|
14,868
|
|
|
|
1,949
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Loss
|
|
|
(1,777
|
)
|
|
|
(1,949
|
)
|
|
|
(14,868
|
)
|
|
|
(1,949
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
202
|
|
|
|
—
|
|
|
|
15,408
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(1,979
|
)
|
|
$
|
(1,949
|
)
|
|
$
|
(30,276
|
)
|
|
$
|
(1,949
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic & Diluted Loss per Common Share
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Common Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding
|
|
|
267,675,000
|
|
|
|
117,675,000
|
|
|
|
208,334,341
|
|
|
|
117,675,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these unaudited financial statements
|
27
Gryphon Rescources, Inc.
|
STATEMENT OF STOCKHOLDERS' DEFICIT
|
|
|
|
Common Stock
|
|
|
|
Additional
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
Shares
|
|
|
|
Par Value
|
|
|
|
Paid-In Capital
|
|
|
|
Accumulated Deficit
|
|
|
|
Stockholders' Deficiency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of September 30, 2016
|
|
|
117,675,000
|
|
|
$
|
117,675
|
|
|
$
|
567,154
|
|
|
$
|
(684,829
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of September 30, 2017
|
|
|
117,675,000
|
|
|
|
117,675
|
|
|
|
567,154
|
|
|
|
(684,829
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beneficial Conversion Feature
|
|
|
—
|
|
|
|
—
|
|
|
|
5,955
|
|
|
|
—
|
|
|
|
5,955
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(31,049
|
)
|
|
|
(31,049
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of September 30, 2018
|
|
|
117,675,000
|
|
|
|
117,675
|
|
|
|
573,109
|
|
|
|
(715,878
|
)
|
|
|
(25,094
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beneficial Conversion Feature
|
|
|
—
|
|
|
|
—
|
|
|
|
15,000
|
|
|
|
—
|
|
|
|
15,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Issuance for Cancellation of Debt
|
|
|
150,000,000
|
|
|
|
150,000
|
|
|
|
(128,839
|
)
|
|
|
—
|
|
|
|
21,161
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(30,276
|
)
|
|
|
(30,276
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of June 30, 2019
|
|
|
267,675,000
|
|
|
$
|
267,675
|
|
|
$
|
459,270
|
|
|
$
|
(746,154
|
)
|
|
$
|
(19,209
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these unaudited financial statements
|
28
Gryphon Rescources, Inc.
|
STATEMENT OF CASH FLOWS
|
(Unaudited)
|
|
|
|
|
|
|
|
For the Nine Months Ended
|
|
|
June 30,
|
|
|
2019
|
|
2018
|
CASH FLOWS FROM OPERATING
|
|
|
|
|
|
|
|
|
ACTIVITIES:
|
|
|
|
|
|
|
|
|
Net Loss
|
|
$
|
(30,276
|
)
|
|
$
|
(1,949
|
)
|
Adjustments to reconcile net loss to net cash
|
|
|
|
|
|
|
|
|
used in operating activities:
|
|
|
|
|
|
|
|
|
Beneficial Conversion Feature
|
|
|
15,000
|
|
|
|
—
|
|
Changes In:
|
|
|
|
|
|
|
|
|
Accounts Payable
|
|
|
(9,780
|
)
|
|
|
1,949
|
|
Accounts Payable - Related Party
|
|
|
(2,500
|
)
|
|
|
—
|
|
Interest Payable - Related Party
|
|
|
408
|
|
|
|
—
|
|
Net Cash Used in Operating Activities
|
|
|
(27,148
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING
|
|
|
|
|
|
|
|
|
Proceeds from Note Payable - Related Party
|
|
|
27,148
|
|
|
|
—
|
|
Net Cash Provided by Financing Activities
|
|
|
27,148
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Net (Decrease) Increase in Cash
|
|
|
—
|
|
|
|
|
|
Cash at Beginning of Period
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Cash at End of Period
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
Cash paid during the year for:
|
|
|
|
|
|
|
|
|
Interest
|
|
$
|
—
|
|
|
$
|
—
|
|
Franchise Taxes
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
150,000,000 shares of common stock were issued in exchange for a debt conversion of $21,161 due to a related party.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these unaudited financial statements
|
29
GRYPHON RESOURCES, INC.
NOTES TO FINANCIAL STATEMENTS
June 30, 2019
Note 1. Organization and Description of
Business
The Company is not currently engaged in any
business operations. It is, however, in the process of attempting to identify, locate, and if warranted, acquire new commercial
opportunities.
Note 2. Going Concern Uncertainties
The Company has not generated any revenues,
has an accumulated deficit of $746,154 as of June 30, 2019, and does not have positive cash flows from operating activities. The
Company expects to incur additional losses as it continues to identify and develop new commercial opportunities. The Company will
be subject to the risks, uncertainties, and difficulties frequently encountered by early-stage companies. The Company may not be
able to successfully address any or all of these risks and uncertainties. Failure to adequately do so could cause the Company’s
business, results of operations, and financial condition to suffer. These conditions raise substantial doubt about the Company’s
ability to continue as a going concern for a period of one year from the issuance date of these financial statements.
The Company’s ability to continue as
a going concern is an issue due to its net losses and negative cash flows from operations, and its need for additional financing
to fund future operations. Management plans to identify commercial opportunities and to obtain necessary funding from outside sources.
There can be no assurance that such funds, if available, can be obtained on terms reasonable to the Company. The accompanying financial
statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that
may result from the outcome of this uncertainty. Based on the Company’s current level of expenditures, management believes
that cash on hand is adequate to fund operations for at least the next twelve months.
Note 3. Summary of Significant Accounting
Policies
Basis of Presentation
The accompanying financial statements have
been prepared in accordance with U.S. GAAP.
Estimates
The preparation of financial statements in
conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities,
and expenses during the reporting period. On an on-going basis, the Company evaluates its estimates. Actual results and outcomes
may differ materially from the estimates as additional information becomes known
Cash and Cash Equivalents
Cash and cash equivalents includes highly liquid investments with original maturities of three months or less. On occasion, the Company has amounts deposited with financial institutions in excess of federally insured limits.
|
Fair Value of Financial Instruments
The Company measures certain financial assets
and liabilities at fair value based on the exchange price that would be received for an asset or paid to transfer a liability (an
exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants.
The carrying value of cash and cash equivalents and accounts payable approximate their fair value because of the short-term nature
of these instruments and their liquidity. Management is of the opinion that the Company is not exposed to significant interest
or credit risks arising from these financial instruments.
Income Taxes
Deferred income tax assets and liabilities
are determined based on the estimated future tax effects of net operating loss and credit carryforwards and temporary differences
between the tax basis of assets and liabilities and their respective financial reporting amounts measured at the current enacted
tax rates. The Company records an estimated valuation allowance on its deferred income tax assets if it is not more likely than
not that these deferred income tax assets will be realized.
30
The Company recognizes a tax benefit
from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing
authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a
position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement.
As of June 30, 2019 and 2018, the Company has not recorded any unrecognized tax benefits. See Note 6. Income Taxes.
Segment Reporting
The Company’s business currently operates
in one segment.
Net Loss per Share
The computation of basic net loss per common
share is based on the weighted average number of shares that were outstanding during the year. The computation of diluted net loss
per common share is based on the weighted average number of shares used in the basic net loss per share calculation plus the number
of common shares that would be issued assuming the exercise of all potentially dilutive common shares outstanding using the treasury
stock method. See Note 4. Net Loss Per Share.
Recently Issued Accounting Pronouncements
The Company reviews new accounting standards
as issued. Although some of these accounting standards issued or effective after the end of the Company’s previous fiscal
year may be applicable to the Company, it has not identified any standards that it believes merit further discussion. The Company
does not expect the adoption of any recently issued accounting pronouncements to have a significant impact on its financial position,
results of operations, or cash flows.
Note 4. Net Loss Per Share
During the nine months ended June 30, 2019 and June 30, 2018, the
Company recorded a net loss. The Company does not have any potentially dilutive securities outstanding. Therefore, basic and diluted
net loss per share is the same for those periods.
Note 5. Related Party
September 30, 2018 – June 30, 2018, the Company issued $15,000
in convertible notes payable to an entity related to the legal custodian of the Company. These notes bear interest at an annual
rate of 10% and are convertible to common shares of the Company at $0.0001 per share. As of June 30, 2019, $0 of the principal
balance and $0 accrued interest is outstanding on the note payable.
In connection with the above note, the Company recognized a beneficial
conversion feature of $15,000, representing the maximum amount of the intrinsic value of the conversion feature at the time of
issuance. This beneficial conversion feature was accreted to interest expense during as of June 30, 2019.
In January 2019, 150,000,000 million shares
were issued in exchange for the cancellations of debt, $21,161 in convertible notes payable and accrued interest to an entity related
to the legal custodian of the Company.
In September 2018 – June 2019, the Company
incurred related party payables in the amount of $4,500 to an entity related to the legal custodian of the Company for professional
fees. As of June 30,2019 $500 is due in accounts payable – related party.
In March 2019, the Company issued a $4,000
promissory note payable and a $2,794 promissory note payable to an entity related to the legal custodian of the Company for payment
of Company expenses. These notes bear interest at an annual rate of 10% and are payable on demand.
In June 2019, the Company issued a $5,000 promissory
note payable and a $354 note payable to an entity related to the legal custodian of the Company for payment of Company expenses.
These notes bear interest at an annual rate of 10% and are payable on demand.
31
Note 6. Income Taxes
Deferred income taxes reflect the net tax effects
of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts
used for income tax purposes. Significant components of the Company’s deferred tax assets at June 30, 2019 and September
30, 2018 are as follows:
|
|
June 30, 2019
|
|
September 30, 2018
|
Deferred tax assets:
|
|
|
|
|
|
|
|
|
Net operating loss carryforwards
|
|
$
|
256,915
|
|
|
$
|
250,557
|
|
|
|
|
|
|
|
|
|
|
Total deferred tax assets
|
|
|
256,915
|
|
|
|
250,557
|
|
|
|
|
|
|
|
|
|
|
Less: valuation allowance
|
|
|
(256,915
|
)
|
|
|
(250,557
|
)
|
|
|
|
|
|
|
|
|
|
Net deferred tax asset
|
|
$
|
—
|
|
|
$
|
—
|
|
The net increase in the valuation allowance
for deferred tax assets was $6,358 for the nine months ended June 30, 2019. The Company evaluates its valuation allowance on an
annual basis based on projected future operations. When circumstances change and this causes a change in management’s judgment
about the realizability of deferred tax assets, the impact of the change on the valuation allowance is reflected in current operations.
For federal income tax purposes, the Company
has net U.S. operating loss carry forwards at June 30, 2019 available to offset future federal taxable income, if any, of $746,154,
which will fully expire by the fiscal year ended September 30, 2038. Accordingly, there is no current tax expense for the
nine months ended June 30, 2019 and 2018.
The utilization of the tax net operating loss
carry forwards may be limited due to ownership changes that have occurred as a result of sales of common stock.
The effects of state income taxes were insignificant
for the nine months ended June 30, 2019 and 2018.
The following is a reconciliation between expected
income tax benefit and actual, using the applicable statutory income tax rate of 21% and 34% for the nine months ended June 30,
2019 and 2018, respectively:
|
|
Nine months Ended
|
|
|
June 30,
|
|
|
2019
|
|
2018
|
|
|
|
|
|
Income tax benefit at statutory rate
|
|
$
|
6,358
|
|
|
$
|
505
|
|
Change in valuation allowance
|
|
|
(6,358
|
)
|
|
|
(505
|
)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
The fiscal years 2012 through 2018 remain open to examination by
federal authorities and other jurisdictions in which the Company operates.
On December 22, 2017, the Tax Cuts and
Jobs Act was enacted. This law substantially amended the Internal Revenue Code, including reducing the U.S. corporate tax rates.
Upon enactment, the Company’s deferred tax asset and related valuation allowance decreased by $110,223 to $150,334. As the
deferred tax asset is fully allowed for, this change in rates had no impact on the Company’s financial position or results
of operations.
Note 7. Subsequent Events
None.
32