ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The
following information should be read in conjunction with our financial statements and related notes thereto included in Part I, Item
1, above.
Forward
Looking Statements
Certain
matters discussed herein are forward-looking statements. Such forward-looking statements contained in this Form 10-Q involve risks and
uncertainties, including statements as to:
● our
future strategic plans
● our
future operating results;
● our
business prospects;
● our
contractual arrangements and relationships with third parties;
● the
dependence of our future success on the general economy;
● our
possible future financing; and
● the
adequacy of our cash resources and working capital.
● the
Covid-19 Pandemic.
From
time to time, we or our representatives have made or may make forward-looking statements, orally or in writing. Such forward-looking
statements may be included in, but not limited to, press releases, oral statements made with the approval of an authorized executive
officer or in various filings made by us with the Securities and Exchange Commission. Words or phrases “will likely result”,
“are expected to”, “will continue”, “is anticipated”, “estimate”, “project or projected”,
or similar expressions are intended to identify “forward-looking statements”. Such statements are qualified in their entirety
by reference to and are accompanied by the above discussion of certain important factors that could cause actual results to differ materially
from such forward-looking statements.
Covid-19
Pandemic
Management
is currently aware of the global and domestic issues arising from the Covid-19 pandemic and the possible direct and indirect affects
on the company’s operations which could have a material adverse effect on the company’s current financial position, future results of
operations, or liquidity, because its current operations are limited. However, investors should also be aware of factors, which includes
the possibility of Covid-19 affects on operational status, could have a negative impact on the Company’s prospects and the consistency
of progress in the areas of revenue generation, liquidity, and generation of capital resources, as the Company implements its business
plan. These may include: (i) variations in revenue, (ii) possible inability to attract investors for the Company’s equity securities
or otherwise raise adequate funds from any source should the Company seek to do so, (iii) increased governmental regulation or significant
changes in that regulation, (iv) increased competition, (v) unfavorable outcomes to litigation involving the Company or to which the
Company may become a party in the future, and (vi) a very competitive and rapidly changing operating environment.
The
risks identified here are not all inclusive. New risk factors emerge from time to time and it is not possible for management to predict
all of such risk factors, nor can it assess the impact of all such risk factors on the company’s business or the extent to which any
factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements.
Accordingly, forward-looking statements should not be relied upon as a prediction of actual results.
The
financial information set forth in the following discussion should be read in conjunction with the financial statements of Gold Rock
Holdings, Inc. included elsewhere herein.
Business
Gold
Rock Holdings, Inc., (Gold Rock) a Nevada corporation, provides engineering and construction management services, produce site-plans,
construction drawings, cost computations, fiber network designs, and other related construction services. In effect the Company will
act as the general contractor to design the cable systems and it will hire subcontractors to implement those designs. These services
will assist underground construction companies in laying fiber-optics and other underground cable in the United States to help solve
the broadband infrastructure gap.
Gold
Rock intends to grow and further establish itself through marketing campaigns to achieve awareness of its construction and engineering
services, as well as drive business growth by partnering with the high-tech service providers, internet service providers, cable service
providers, satellite service providers, mobile phone providers, communication providers, and local municipalities. In addition, the Company
is actively considering acquisitions that would be accretive to its business. Currently, Gold Rock markets itself through third-parties
that have existing relationships with these providers in their existing demographic service areas. The third parties are construction
companies, or other engineering outfits who propose bids on pending or ongoing high-tech and fiber-optic underground projects in areas
that are either lacking or upgrading high-tech broadband infrastructures. Gold Rock Holding’s management evaluates each engineering and
consulting job on a case by case bases with the intent to enter into a contract for its “UGnet” services. At this time, Gold
Rock Holdings, Inc. has no contracts.
At
this time, the Company expects to receive 100% of its revenues from the sale of the Company’s “UGnet”construction management,
engineering services and fiber network designs, as it pertains to underground fiber-optic high-speed broadband and cable infrastructures.
Gold Rock services are offered through the “UGnet” service line, which stands for “Underground Networks.”
The
Company proactively seeks to expand its Gold Rock “UGnet” services throughout the U.S., and will continue to approach municipalities,
utilities, and cable, phone, mobile phone and internet providers with competitive quotes on underground development of high-speed fiber
optic broadband connectivity. The Company will continue to try to advance its social media platform with direct online and targeted marketing
with the objective of expanding its demographics.
Gold
Rock Holdings, Inc. maintains an executive office in Virginia Beach, Virginia where all marketing, sales, and customer supports activities
are implemented.
Officer
Appointments and Resignations
On
August 26, 2022 the Board of Directors (“the Board”) accepted the resignation from Mr. Merle Ferguson as the Company’s Chief
Financial Officer and Secretary. Mr. Ferguson remains the Comany’s Chairman of the Board, Cheif Executive Officer and President of the
Company.
On
August 26, 2022, the Board of Directors (the “Board”) of Gold Rock Holdings, Inc. (the “Company”) appointed Mr.
Richard Kaiser from Virginia Beach, VA as a Board of Director, Chief Financial Officer and Secretary for the Company.
Compensation
Agreements
The
Company entered into a new employment contract with Mr. Ferguson for his rolls as Chairman/CEO/President for a three (5) year period
from January 01, 2023 until December 31, 2028, annual pay at $95,000.
The
Company entered into an employment contract with Mr. Kaiser for his rolls as CFO/Secretary/Director for a three (3) year period from
January 01, 2023 until December 31, 2026, annual pay at $75,000.
The
Company has a consulting agreement with Mr. Kaiser’s Company, YES INTERNATIONAL, LLC, for general consulting services and to
provide executive office space for Gold Rock Holdings, Inc. The agreement is on a month-to-month bases for $1,000 per month with a 30-day
advance notice to discontinue services.
Transfer
Agent
Our
transfer agent is Transfer Online, Inc. whose address is 512 SE Salmon Street, Portland, Oregon 97214, and telephone number (503) 227-2950.
Company
Contact Information
Our
principal executive and subsidiary offices are located at 2020 General Booth Blvd., Unit 230, Virginia Beach, VA 23454, telephone (757)
306-6090. The information to be contained in our Internet website, www.bioforceeclipse.com, shall not constitute part of this report.
Current
Directors
The
following table provides information concerning our officers and directors. All directors hold office until the next annual meeting of
stockholders or until their successors have been elected and qualified.
| |
|
| Merle
Ferguson |
Director/
CEO/ President |
| Richard
Kaiser |
Director/CFO/Secretary |
| |
|
Transfer
Agent
Our
transfer agent is Signature Stock Transfer, Inc. whose address is 14673 Midway Road, Suite 220, Addision, Texas, 75001 and its telephone
number 972-612-4120.
Company
Contact Information
Our
principal executive and subsidiary offices are located at 2020 General Booth Blvd., Unit 230, Virginia Beach, VA 23454, telephone (757)
306-6090. The information to be contained in our Internet website, www.goldrockholdings.us, shall not constitute part of
this report.
Management’s
Discussion and Analysis of Financial Condition and Results of Operations
Overall
Operating Results:
Three
Months – March 31, 2023 and 2022 Statements
The
Sales Revenue for the three months ended March 31, 2023 and 2022 were $-0-.
The
Cost of Goods Sold for the three months ended March 31, 2023 and 2022 was $-0-.
Gross
Margins for the three months ended March 31, 2023 and 2022 was 0%.
Gross
Profit for the three months ended March 31, 2023 and 2022 was $-0-.
Operating
expenses for three months ended March 31, 2023, totaled $196,358 from Board of Directors Compensation, Consulting Expense and General
and Administrative Expenses, compared to $51,349 for the three months ended March 31, 2022. The increase in March 31, 2023 compared to
the same period ended March 31, 2022 was attributed to increase in Board of Directors Compensation Expenses.
Net
Loss:
Net
loss for the three months ended March 31, 2023 and 2022 were $196,358 and $51,349, respectively.
Liquidity
and Capital Resources:
As
of March 31, 2023, the Company’s assets totaled $6,961 which consisted of Cash and Pre-paid Expenses. Our total liabilities were
$2,210. As of March 31, 2023, the Company had an accumulated deficit of $830,084 and working capital of a $4,751.
As
indicated herein, we need capital for the implementation of our business plan, and we will need additional capital for continuing our
operations. We do not have sufficient revenues to pay our operating expenses at this time. Unless the company is able to raise working
capital, it is likely that the Company will either have to cease operations or substantially change its methods of operations or change
its business plan (See Note 4 in Financial Statements). For the next 12 months the Company has a written commitment from its CEO in Mr.
Merle Ferguson’s employment contract to advance funds as necessary in meeting the Company’s operating requirements.
Gold
Rock Holdings, Inc. does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company,
or any of its subsidiaries’ operating results, financial position, or cash flow.
Cash
(Used in) Operating Activities
Net
cash used in operating activities for the three months ended March 31, 2023 and 2022 were $48 and $17,524, respectively. The decrease
in the amount of cash used during the three months ended March 31, 2023 was because more expensives paid with stock and less expenses
paid in cash.
Cash
Flows from Investing Activities
Net
cash used in investing activities was $-0- for both the three months ended March 31, 2023 and 2022
Cash
Provided by Financing Activities
Net
cash provided by financing activities was $-0- for three months ended March 31, 2023, and was $17,524 for three month ended March 31,
2022 from the amount of Capital Contributions from the Company’s directors.
Critical
Accounting Policies
Our
financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States.
Preparing financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities,
revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. Critical
accounting policies include revenue recognition and stock-based compensation. The Company has implemented all new accounting pronouncements
that are in effect and is evaluating any that may impact its financial statements, including revenue recognition. The Company does not
believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial
position or results of operations.
Revenue
Recognition
In
accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”), revenues are recognized when control of the
promised goods or services is transferred to our clients, in an amount that reflects the consideration to which we expect to be entitled
in exchange for those goods and services. To achieve this core principle, we apply the following five steps: (1) Identify the contract
with a client; (2) Identify the performance obligations in the contract; (3) Determine the transaction price; (4) Allocate the transaction
price to performance obligations in the contract; and (5) Recognize revenues when or as the company satisfies a performance obligation.
We
adopted this ASC on January 1, 2019. Although the new revenue standard is expected to have an immaterial impact, if any, on our ongoing
net income, we did implement changes to our processes related to revenue recognition and the control activities within them.
Stock-Based
Compensation
We
account for employee and non-employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation—Stock
Compensation, which requires all share-based payments, including grants of stock options, to be recognized in the financial
statements based on their fair values. The fair value of the equity instrument is charged directly to compensation expense and
credited to additional paid-in capital over the period during which services are rendered.
Recent
Accounting Pronouncements
The
Company has implemented all new accounting pronouncements that are in effect and is evaluating any that may impact its financial statements,
including revenue recognition. The Company does not believe that there are any other new accounting pronouncements that have been
issued that might have a material impact on its financial position or results of operations.
Off-Balance
Sheet Arrangements
We
do not have any off-balance sheet arrangements.
Going
Concern
We
have incurred net losses since our inception. We anticipate incurring additional losses before realizing growth in revenue and we
will depend on additional financing in order to meet our continuing obligations and ultimately to attain profitability. Our ability
to obtain additional financing, whether through the issuance of additional equity or through the assumption of debt, is uncertain. These
conditions raise substantial doubt as to the Company’s ability to continue as a going concern. The financial statements do not include
any adjustments that might result from the uncertainty about our ability to continue our business.
ITEM
4. CONTROLS AND PROCEDURES
Evaluation
of Disclosure Controls and Procedures
Our
management, with the participation of our Principal Executive Officer and Principal Financial Officer, evaluated the effectiveness of
our disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as of the end
of the period covered by this Quarterly Report on Form 10-Q. In designing and evaluating the disclosure controls and procedures, management
recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving
the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource
constraints, and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative
to their costs.
Based
on our evaluation, our Principal Executive Officer and Principal Financial Officer, after considering the existence of material weaknesses
identified, determined that our internal control over financial reporting disclosure controls and procedures were not effective as of
March 31, 2023.
Evaluation
of Internal Control over Financial Reporting
Our
management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f)
and 15d-15(f) under the Securities Exchange Act of 1934, as amended. Our internal control over financial reporting is designed
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with U.S. generally accepted accounting principles.
Our
internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that
in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets, (ii) provide reasonable assurance
that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles, and that our receipts and expenditures are being made only in accordance with the authorization of our management and directors,
and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our
assets that could have a material effect on our financial statements.
Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of
any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may deteriorate.
Management,
including our Principal Executive Officer and Principal Financial Officer, assessed the effectiveness of our internal control over financial
reporting as of March 31, 2023. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations
of the Treadway Commission (“COSO”) in Internal Control – Integrated Framework (2013).
We
identified the following deficiencies which together constitute a material weakness in our assessment of the effectiveness of internal
control over financial reporting as of March 31, 2023:
| - | The
Company has inadequate segregation of duties within its cash disbursement control design. |
| - | During
the period ended March 31, 2023, the Company internally performed all aspects of its financial
reporting process, including, but not limited to the underlying accounting records and the
recording of journal entries and for the preparation of financial statements. This process
was deficient, because these duties were performed often times by the same people, and therefore
a lack of review was created over the financial reporting process that might result in a
failure to detect errors in spreadsheets, calculations, or assumptions used to compile the
financial statements and related disclosures as filed with the SEC. These control deficiencies
could result in a material misstatement to our interim or annual financial statements that
would not be prevented or detected. |
It
should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance
that the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about
the likelihood of future events. Because of these and other inherent limitations of control system, there can be no assurance that any
design will succeed in achieving its stated goals under all potential future conditions.
This
report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial
reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to rules of
the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.
We
regularly review our system of internal control over financial reporting to ensure that we maintain an effective internal control environment.
If deficiencies appear in our internal controls, management will make changes that address those deficiencies.
Changes
in Internal Control Over Financial Reporting
There
have been no changes in the Company’s internal control over financial reporting that occurred during the reporting period
ended September 30, 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal
control over financial reporting.
Coronavirus
Impact (COVID-19)
Due
to the recent outbreak of the coronavirus reported in many countries worldwide, local and federal governments have issued travel advisories,
canceled large scale public events and closed schools. In addition, companies have begun to cancel conferences and travel plans and require
employees to work from home. Global financial markets have also experienced extreme volatility and disruptions to capital and credit
markets.
We
are unable to predict the impact of the coronavirus on our operations at this time. Adverse events such as health-related concerns about
working in our offices, the inability to travel, potential impact on our business partners and customers, and other matters affecting
the general work and business environment could harm our business and delay the implementation of our business strategy. The adverse
events may also adversely impact our ability to raise capital or to continue as a going concern. We continue to monitor the recent outbreak
of the coronavirus on our operations. The global economic slowdown and the other risks and uncertainties associated with the pandemic
could have a material adverse effect on our business, financial condition, results of operations and growth prospects. In addition, to
the extent the ongoing COVID-19 pandemic adversely affects the Company’s business and results of operations, it may also have the effect
of heightening many of the other risks and uncertainties which the Company faces.