NOTES
TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
NOTE
1 – Basis of Presentation, Organization, Going Concern, Recent Accounting Standards and Earnings (Loss) Per Share
Basis
of Presentation
The
accompanying unaudited interim consolidated financial statements of Arizona Gold and Onyx Mining Company and Subsidiaries (the
“Company”) as of September 30, 2019, and for the three and nine months ended September 30, 2019 and 2018, include
the accounts of the Company and its non-operating subsidiaries and have been prepared in accordance with generally accepted accounting
principles in the United States of America (“US GAAP”), for interim financial information and with the instructions
to Form 10-Q and Article 8 of Regulation S-X. Certain information or footnote disclosures normally included in financial statements
prepared in accordance with GAAP have been condensed or omitted.
The
preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the consolidated financial statements, and the reported amounts of expenses during the reporting periods. Actual results may differ
from those estimates. The interim financial statements should be read in conjunction with the audited financial statements and
notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. In the opinion
of management, the accompanying unaudited interim consolidated financial statements have been prepared on the same basis as the
audited financial statements and include all adjustments (including normal recurring adjustments) necessary for the fair presentation
of the Company’s financial position as of September 30, 2019, results of operations for the three and nine months ended
September 30, 2019 and 2018, and stockholders equity and cash flows for the nine months ended September 30, 2019 and 2018. The
Company did not record an income tax provision during the periods presented due to net taxable losses. The results of operations
for any interim period are not necessarily indicative of the results of operations for the entire year.
Organization
Our
Company’s name is Arizona Gold and Onyx Mining Company. The Company was incorporated on November 12, 1986, in the state
of Utah under the name of Silver Harvest, Inc. In February 1990, the Company amended its Articles of Incorporation to change its
name to Viking Capital Group, Inc. In June 2010, the Company changed its name to its name to Arizona Gold and Onyx Mining Company.
On February 1, 2018, the Company changed its name to its name to Nuzia Pharmaceutical Corporation in anticipation of completion
of a merger with California Biotech, Inc., owner of www.NunziaPharmaceutical.com. Due to lack of FINRA approval of the name change
to Nunzia Pharmaceutical Corporation, on April 17, 2019, the Company changed its name back to Arizona Gold and Onyx Mining Company.
The proposed transaction has not been consummated.
In
February 2007, the company fell into default status after abandoning its business plan and for failing to file and pay annual
fees to the State of Utah. On May 21, 2009, the Third District Court, in and for Salt Lake County, State of Utah, appointed a
custodian to the Company. The custodian reestablished the Company in good standing, but did not resume operations. The Company
was seeking an operating company with which to merge or to acquire.
On
October 5, 2009, the court appointed custodian reverse split (1-for-10) the outstanding Class B Common shares of 100,000 to 10,000
shares and issued a new certificate for 51,000 Class B Common shares to Joseph Arcaro, former CEO, bringing the total outstanding
Class B Common shares of 61,000.
On
October 6, 2009, the Company affected a reverse split of 1:300 resulting in the reduction of Class A Common Stock outstanding
from 112,410,467 to approximately 375,000 shares.
On
April 23, 2010, the Company filed Form 15 to suspend the Company’s reporting requirements under the Securities Exchange
Act of 1934, as amended.
On
May 21, 2010, the Company affected a reverse split of 1-for 10 resulting in the reduction of Class A Common Stock outstanding
to 89,077 shares.
On
June 21, 2010, the Company issued 12,000,000 shares of Class A Common Stock in exchange for $5,000 of debt bringing the total
issued and outstanding Class A Common Stock to 12,089,077 shares.
On
June 28, 2010, the Company and Gold & Onyx Mining Company (“GOMC”) closed, a Securities Exchange Agreement (the
“Merger”). Pursuant to the terms of the Merger, the Company changed its corporate name from Viking Capital Group,
Inc. to Arizona Gold & Onyx Mining Company (“AGOMC”), and issued 131,000,000 shares to the shareholders of GOMC
such that GOMC shareholders acquired approximately 91.6% of the total 143,089,077 shares of Class A Common Stock outstanding after
the Merger.
The
terms and conditions of the Merger gave rise to reverse merger accounting whereby Gold & Onyx Mining Company was deemed the
acquirer for accounting purposes. Consequently, the assets and liabilities and the historical operations of Gold & Onyx Mining
Company prior to the Merger are reflected in the financial statements and have been recorded at the historical cost basis of Gold
& Onyx Mining Company.
In
the purchase of GOMC by AGOMC, all seven subsidiaries of AGOMC became part of the combined corporation. These subsidiaries were:
A1 Mining; NIAI Insurance Administrators, Inc. of California; Viking Capital Financial Services, Inc. of Texas; Viking Insurance
Services, Inc. of Texas; Viking Systems, Inc. of Texas; Viking Administrators, Inc. of Texas; Viking Capital Ventures, Inc. of
Texas; and 60% of Brentwood Re, Ltd. of the Island of Nevis. All of these subsidiaries have had their charters suspended or revoked
and have been inactive for several years.
On
October 22, 2017, the Company and California Biotech, Inc., owner of www.NunziaPharmaceutical.com, entered into a Merger and Consolidation
Agreement (the “MCA”). In anticipation of closing on the MCA, on February 1, 2018, the Board authorized a 7,000:1
reverse stock split (The Company filed with FINRA to approve the corporate action which is pending as of the date of this report)
and amended its articles changing its name to Nunzia Pharmaceutical Corporation. A closing condition of the MCA is bringing the
Company current with its SEC reporting requirements. Upon closing, the MCA provides for the Company to issue a single share for
each single share of California Biotech, Inc. outstanding.
Going
Concern
The
Company’s financial statements are prepared using generally accepted accounting principles in the United States of America
applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course
of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs to allow
it to continue as a going concern. As of September 30, 2019, the Company had an accumulated deficit of $319,658. The ability of
the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until
it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.
In
view of these conditions, the ability of the Company to continue as a going concern is in doubt and dependent upon achieving a
profitable level of operations and on the ability of the Company to obtain necessary financing to fund ongoing operations. Historically,
the Company has relied upon internally generated funds and funds from the sale of shares of stock, issuance of promissory notes
and loans from its shareholders and private investors to finance its operations and growth. Management is planning to raise necessary
additional funds for working capital through loans and/or additional sales of its common stock. However, there is no assurance
that the Company will be successful in raising additional capital or that such additional funds will be available on acceptable
terms, if at all. Should the Company be unable to raise this amount of capital its operating plans will be limited to the amount
of capital that it can access. These financial statements do not give effect to any adjustments which will be necessary should
the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities
in other than the normal course of business and at amounts different from those reflected in the accompanying financial statements.
Recent
Accounting Standards
Any
reference in these notes to applicable accounting guidance is meant to refer to the authoritative non-governmental US GAAP as
found in the Financial Accounting Standards Board's Accounting Standards Codification.
In
February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”, which supersedes ASC Topic 840, Leases, and
creates a new topic, ASC Topic 842, Leases. ASU 2016-02 requires lessees to recognize a lease liability and a lease asset for
all leases, including operating leases, with a term greater than 12 months on its balance sheet. ASU 2016-02 also expands the
required quantitative and qualitative disclosures surrounding leases. ASU 2016-02 is effective for the Company beginning January
1, 2019. Early adoption is permitted. The Company has determined that the adoption of ASU 2016-02 did not have an impact on its
consolidated financial statements.
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, the Company has not identified any standards that the Company
believes merit further discussion other than as discussed above. The Company believes that none of the new standards will have
a significant impact on the financial statements.
Earnings
(Loss) Per Share
The
Company presents both basic and diluted earnings per share ("EPS") amounts. Basic EPS is calculated by dividing net
income (loss) by the weighted average number of common shares outstanding during the period presented. Diluted EPS amounts are
based upon the weighted average number of common and common equivalent shares outstanding during the period presented. The Company
has not included the effects of warrants, stock options and convertible debt on net loss per share because to do so would be antidilutive.
Following
is the computation of basic and diluted net loss per share for the three and nine months ended September 30, 2019 and 2018:
|
|
Three
Months Ended
|
|
Nine
Months Ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Basic
and Diluted EPS Computation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Numerator:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
available to common stockholders'
|
|
$
|
(1,307
|
)
|
|
$
|
(2,807
|
)
|
|
$
|
(22,371
|
)
|
|
$
|
(17,770
|
)
|
Denominator:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares outstanding
|
|
|
126,859,077
|
|
|
|
146,859,077
|
|
|
|
134,438,986
|
|
|
|
146,859,077
|
|
Basic
and diluted EPS
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
NOTE
2 – Current Liabilities
Accounts
Payable and Accrued Expenses
During
the year ended Decemner 31, 2010, the Company received funds from various third parties totaling $40,000 which were used for operating
expenses and remain unpaid through September 30, 2019 and December 31, 2018. Accounts payable and accrued expenses increased each
year from 2011 through September 30, 2019 primarily due to stock agent fees and legal and professional fees.
Related
party Advances
From
time-to-time the Company’s CEO has advanced funds to cover administrative costs related to maintaining the corporate entity
and with the intent to bring its public filings current. Additionally, other related parties have provided services and or paid
for costs on behalf of the Company. As of December 31, 2010, the balances advanced totaled $102,752. From 2010 through September
30, 2019 no reimbursements of related party advances were made to any related party due to the lack of funding. Related party
advances grew by $0 and $19,450 during the three and nine months ended September 30, 2019, respectively.
Related
Party Promissory Note
On
May 9, 2009, the Company issued a non-interest bearing promissory note in the amount of $23,000 to our current CEO in exchange
for services. The note matured on May 5, 2010 and is currently in default.
NOTE
3 – Preferred and Common Stock
Preferred
Stock
The
Company has Preferred stock: $1.00 par value; 50,000,000 shares authorized with no shares issued and outstanding.
Common
Stock
The
Company has 500,000,000 shares of Class A Common Stock authorized of which 126,859,077 shares are issued and outstanding as of
September 30, 2019 and December 31, 2018.
On
April 23, 2019, the Board canceled 20,000,000 Class A common shares that were returned.
The
Company has 100,000 shares of Class B Common Stock authorized of which 61,000 shares are issued and outstanding as of September
30, 2019 and December 31, 2018.
The
Class B shares are the only shares entitled to vote for Board Members. Class A and B shares are entitled to vote on all other
matters.
NOTE
4 – Subsequent Events
Management
has reviewed material events subsequent of the period ended September 30, 2019 and prior to the filing of financial statements
in accordance with FASB ASC 855 “Subsequent Events”.