UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 2012
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from __________ to __________
Commission File Number 000-54322
LITHIUM CORPORATION
(Exact name of registrant as specified in its charter)
Nevada 98-0530295
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
11380 S Virginia St. # 2011, Reno, Nevada 89511
(Address of principal executive offices) (Zip Code)
775.410.5287
(Registrant's telephone number, including area code)
10597 Double R Blvd, Reno, Nevada 89521
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] YES [ ] NO
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). [X] YES [ ] NO
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a small reporting company. See
the definitions of "large accelerated filer", "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act [ ] YES [X] NO
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant has filed all documents and reports required to be
filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. [ ] YES [ ] NO
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
63,661,408 common shares issued and outstanding as of November 1, 2012.
LITHIUM CORPORATION
FORM 10-Q
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 15
Item 3. Quantitative and Qualitative Disclosures About Market Risk 22
Item 4. Controls and Procedures 22
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 23
Item 1A. Risk Factors 23
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 23
Item 3. Defaults Upon Senior Securities 23
Item 4. Mine Safety Disclosures 23
Item 5. Other Information 23
Item 6. Exhibits 23
SIGNATURES 25
2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Our unaudited consolidated interim financial statements for the three and nine
month periods ended September 30, 2012 form part of this quarterly report. They
are stated in United States Dollars (US$) and are prepared in accordance with
United States Generally Accepted Accounting Principles.
3
Lithium Corporation
(An Exploration Stage Company)
Consolidated Balance Sheets
(unaudited)
September 30, December 31,
2012 2011
------------ ------------
ASSETS
Current Assets
Cash $ 749,693 $ 970,030
Accounts receivable 674 674
Prepaid expenses 48,248 73,421
------------ ------------
Total Current Assets 798,615 1,044,125
------------ ------------
Other Assets
Property and equipment, net 215 377
Mineral properties 163,140 506,516
------------ ------------
Total Other Assets 163,355 506,893
------------ ------------
TOTAL ASSETS $ 961,970 $ 1,551,018
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities $ 18,793 $ 21,730
------------ ------------
Total Current Liabilities 18,793 21,730
------------ ------------
TOTAL LIABILITIES 18,793 21,730
------------ ------------
Commitments and contingencies
STOCKHOLDERS' EQUITY
Common stock, 3,000,000,000 shares authorized, par value $0.001;
63,661,408 common shares issued and outstanding (2011 - 62,917,288) 63,662 63,662
Additional paid in capital 1,718,093 1,718,093
Additional paid in capital - options 203,318 179,587
Additional paid in capital - warrants 1,252,243 1,252,243
Deficit accumulated during the exploration stage (2,294,139) (1,684,297)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 943,177 1,529,288
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 961,970 $ 1,551,018
============ ============
See the accompanying notes to the interim consolidated financial statements
4
Lithium Corporation
(An Exploration Stage Company)
Consolidated Statements of Operations (unaudited)
Period from
Three Months Three Months Nine Months Nine Months January 30, 2007
Ended Ended Ended Ended (Inception) to
September 30, September 30, September 30, September 30, September 30,
2012 2011 2012 2011 2012
------------ ------------ ------------ ------------ ------------
REVENUE $ -- $ -- $ -- $ -- $ --
------------ ------------ ------------ ------------ ------------
OPERATING EXPENSES
Professional fees 13,273 5,359 46,612 15,608 185,131
Depreciation 54 -- 162 498 2,218
Exploration expenses 16,700 102,851 49,459 191,759 562,823
Consulting fees 18,550 6,258 44,768 34,420 272,632
Insurance expense 3,903 3,913 11,709 11,687 30,613
Investor relations 11,852 15,302 36,600 49,686 218,593
Interest expense -- -- -- -- 11,850
Management fees -- -- -- -- 53,800
Promotion -- -- 2,137 -- 2,137
Transfer agent and filing fees 2,498 4,321 6,704 9,516 41,599
Travel 5,396 4,315 13,178 15,320 58,506
Stock option compensation -- -- 23,731 -- 267,776
Website development costs -- -- -- -- 3,912
Write-down of website costs -- -- -- -- 12,000
Write-down of mineral properties 369,137 37,033 369,137 37,033 518,746
General and administrative 2,257 4,700 7,070 10,274 72,485
------------ ------------ ------------ ------------ ------------
TOTAL OPERATING EXPENSES 443,620 184,052 611,267 375,801 2,314,821
------------ ------------ ------------ ------------ ------------
LOSS FROM OPERATIONS (443,620) (184,052) (611,267) (375,801) (2,314,821)
OTHER INCOME (EXPENSE)
Other income -- -- 671 -- 18,623
Interest income 318 231 754 908 2,059
------------ ------------ ------------ ------------ ------------
LOSS BEFORE INCOME TAXES (443,302) (183,821) (609,842) (374,893) (2,294,139)
PROVISION FOR INCOME TAXES -- -- -- -- --
------------ ------------ ------------ ------------ ------------
NET LOSS $ (443,302) $ (183,821) $ (609,842) $ (374,893) $ (2,294,139)
============ ============ ============ ============ ============
NET LOSS PER SHARE: BASIC AND
DILUTED $ (0.00) $ (0.00) $ (0.00) $ (0.00)
============ ============ ============ ============
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING: BASIC AND DILUTED 63,661,408 63,337,360 63,661,408 63,175,138
============ ============ ============ ============
See the accompanying notes to the interim consolidated financial statements
5
Lithium Corporation
(An Exploration Stage Company)
Consolidated Statement of Stockholders' Equity
From January 30, 2007 (Inception) to September 30, 2012
(unaudited)
Deficit
Additional Additional Accumulated
Common Stock Additional Paid in Paid in during the
--------------------- Paid in Capital- Capital- Exploration
Shares Amount Capital Warrants Options Stage Total
------ ------ ------- -------- ------- ----- -----
Balance, January 30, 2007
(date of inception) -- $ -- $ -- $ -- $ -- $ -- $ --
Shares issued to founder
on January 30, 2007
@ $0.001 per share
(par value $0.001 per share) 240,000,000 240,000 (220,000) -- -- -- 20,000
Net loss for the period
ended December 31, 2007 -- -- -- -- -- (23,448) (23,448)
------------ --------- ---------- ---------- -------- ----------- ----------
Balance, December 31, 2007 240,000,000 240,000 (220,000) -- -- (23,448) (3,448)
Common stock issued for cash
@ $0.10 per share 28,200,000 28,200 18,800 -- -- -- 47,000
Net loss for the year ended
December 31, 2008 -- -- -- -- -- (26,868) (26,868)
------------ --------- ---------- ---------- -------- ----------- ----------
Balance, December 31, 2008 268,200,000 268,200 (201,200) -- -- (50,316) 16,684
Shares issued in conjunction
with merger 12,350,000 12,350 537,355 -- -- -- 549,705
Shares cancelled (220,000,000) (220,000) 220,000 -- -- -- --
Net loss for the year ended
December 31, 2009 -- -- -- -- -- (190,414) (190,414)
------------ --------- ---------- ---------- -------- ----------- ----------
Balance, December 31, 2009 60,550,000 60,550 556,155 -- -- (240,730) 375,975
Shares issued with respect
to Fish Lake 367,288 368 174,632 -- -- -- 175,000
Common stock issued for cash
@ $1.00 per share 2,000,000 2,000 745,757 1,252,243 -- -- 2,000,000
Stock options issued -- -- -- -- 244,045 -- 244,045
Net loss for the year ended
December 31, 2010 -- -- -- -- -- (852,656) (852,656)
------------ --------- ---------- ---------- -------- ----------- ----------
Balance, December 31, 2010 62,917,288 62,918 1,476,544 1,252,243 244,045 (1,093,386) 1,942,364
Shares issued with respect
to Fish Lake 394,120 394 87,106 -- -- -- 87,500
Forgiveness of debt -- -- 6,335 -- -- -- 6,335
Options exercised 350,000 350 148,108 -- (64,458) -- 84,000
Net loss -- -- -- -- -- (590,911) (590,911)
------------ --------- ---------- ---------- -------- ----------- ----------
Balance, December 31, 2011 63,661,408 63,662 1,718,093 1,252,243 179,587 (1,684,297) 1,529,288
Stock options issued -- -- -- -- 23,731 -- 23,731
Net loss -- -- -- -- -- (609,842) (609,842)
------------ --------- ---------- ---------- -------- ----------- ----------
Balance, September 30, 2012 63,661,408 $ 63,662 $1,718,093 $1,252,243 $203,318 $(2,294,139) $ 943,177
============ ========= ========== ========== ======== =========== ==========
See the accompanying notes to the interim consolidated financial statements
6
Lithium Corporation
(An Exploration Stage Company)
Consolidated Statements of Cash Flows
(unaudited)
Period from
Nine Months Nine Months January 30, 2007
Ended Ended (Inception) to
September 30, September 30, September 30,
2012 2011 2012
------------ ------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss for the period $ (609,842) $ (374,893) $ (2,294,139)
Adjustment for non-cash items:
Write-down of software development -- -- 12,000
Write-down of mineral properties 369,137 37,033 518,746
Stock option compensation expense 23,731 -- 267,776
Amortization 162 498 2,218
Changes in assets and liabilities:
(Increase) decrease in accounts receivable -- -- (674)
(Increase) decrease in prepaid expenses 25,173 8,769 (48,248)
Increase (decrease) in accounts payable
and accrued liabilities (2,937) (21,518) 18,793
------------ ------------ ------------
Net Cash Used in Operating Activities (194,577) (350,111) (1,523,528)
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of equipment -- -- (2,433)
Purchase of software development -- -- (12,000)
Interest in mineral properties (25,760) (40,543) (419,386)
------------ ------------ ------------
Net Cash Used in Investing Activities (25,760) (40,543) (433,819)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from (repayment to) director -- -- 6,335
Proceeds from sale of stock -- 84,000 2,700,705
------------ ------------ ------------
Net Cash Provided by (Used in) Financing Activities -- 84,000 2,707,040
------------ ------------ ------------
Increase (decrease) in cash (220,337) (306,654) 749,693
Cash, beginning of period 970,030 1,398,758 --
------------ ------------ ------------
Cash, end of period $ 749,693 $ 1,092,104 $ 749,693
============ ============ ============
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest $ 0 $ 0 $ 10,451
============ ============ ============
Cash paid for income taxes $ 0 $ 0 $ 0
============ ============ ============
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES:
Common stock issued for mineral properties $ 0 $ 87,500 $ 262,500
============ ============ ============
Shareholder debt converted to contributed capital $ 0 $ 0 $ 6,335
============ ============ ============
See the accompanying notes to the interim consolidated financial statements
7
Lithium Corporation
(An Exploration Stage Company)
Notes to Consolidated Financial Statements
September 30, 2012
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Lithium Corporation (formerly Utalk Communications Inc.) was incorporated on
January 30, 2007 under the laws of Nevada. On September 30, 2009, Utalk
Communications Inc. changed its name to Lithium Corporation.
Nevada Lithium Corporation was incorporated on March 16, 2009 under the laws of
Nevada under the name Lithium Corporation. On September 10, 2009, the Company
amended its articles of incorporation to change its name to Nevada Lithium
Corporation. By agreement dated October 09, 2009 Nevada Lithium Corporation and
Lithium Corporation amalgamated as Lithium Corporation. Lithium Corporation is
engaged in the acquisition and development of certain lithium interests in the
state of Nevada, and is currently in the exploration stage. These consolidated
financial statements have been prepared in accordance with U.S. generally
accepted accounting principles.
Exploration Stage Company
The accompanying financial statements have been prepared in accordance with
generally accepted accounting principles related to accounting and reporting by
exploration stage companies. An exploration stage company is one in which
planned principal operations have not commenced or if its operations have
commenced, there has been no significant revenues there from.
Accounting Basis
The Company uses the accrual basis of accounting and accounting principles
generally accepted in the United States of America ("GAAP" accounting). The
Company has adopted a December 31 fiscal year end.
Cash and Cash Equivalents
Cash includes cash on account, demand deposits, and short-term instruments with
maturities of three months or less.
Concentrations of Credit Risk
The Company maintains its cash in bank deposit accounts, the balances of which
at times may exceed federally insured limits. The Company continually monitors
its banking relationships and consequently has not experienced any losses in
such accounts. The Company believes it is not exposed to any significant credit
risk on cash and cash equivalents.
Use of Estimates
The preparation of consolidated financial statements in conformity with
generally accepted accounting principles 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 amount of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Revenue Recognition
The Company is in the exploration stage and has yet to realize revenues from
operations. Once the Company has commenced operations, it will recognize
revenues when delivery of goods or completion of services has occurred provided
there is persuasive evidence of an agreement, acceptance has been approved by
its customers, the fee is fixed or determinable based on the completion of
stated terms and conditions, and collection of any related receivable is
probable.
8
Lithium Corporation
(An Exploration Stage Company)
Notes to Consolidated Financial Statements
September 30, 2012
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Principles of Consolidation
The consolidated financial statements include the accounts of our wholly-owned
subsidiary. All material inter-company transactions have been eliminated.
Loss per Share
Basic loss per share is computed by dividing loss available to common
shareholders by the weighted average number of common shares outstanding during
the year. The computation of diluted earnings per share assumes the conversion,
exercise or contingent issuance of securities only when such conversion,
exercise or issuance would have a dilutive effect on earnings per share. The
dilutive effect of convertible securities is reflected in diluted earnings per
share by application of the "if converted" method. In the periods in which a
loss is incurred, the effect of potential issuances of shares under options and
warrants would be anti-dilutive, and therefore basic and diluted losses per
share are the same.
Computer Equipment
Computer equipment is stated on the basis of historical cost less accumulated
depreciation. Depreciation is provided using the straight-line method over the
estimated useful lives of the assets which has been estimated as 2 years.
Impairment losses are recorded on computer equipment used in operations when
indicators of impairment are present and the undiscounted cash flows estimated
to be generated by those assets are less than the assets' carrying amount.
Income Taxes
The asset and liability approach is used to account for income taxes by
recognizing deferred tax assets and liabilities for the expected future tax
consequences of temporary differences between the carrying amounts and the tax
basis of assets and liabilities.
Financial Instruments
The Company's financial instruments consist of cash, accounts receivable,
prepaid expenses, and accounts payable and accrued liabilities. Unless otherwise
noted, it is management's opinion that the Company is not exposed to significant
interest, currency or credit risks arising from these financial instruments.
Because of the short maturity and capacity of prompt liquidation of such assets
and liabilities, the fair value of these financial instruments approximate their
carrying values, unless otherwise noted.
Mineral Properties
Costs of exploration, carrying and retaining unproven mineral lease properties
are expensed as incurred. Mineral property acquisition costs are capitalized
including licenses and lease payments. Although the Company has taken steps to
verify title to mineral properties in which it has an interest, these procedures
do not guarantee the Company's title. Such properties may be subject to prior
agreements or transfers and title may be affected by undetected defects.
Impairment losses are recorded on mineral properties used in operations when
indicators of impairment are present and the undiscounted cash flows estimated
to be generated by those assets are less than the assets' carrying amount.
Impairment of $518,746 was recorded since inception relating to the abandonment
of some mineral claims.
9
Lithium Corporation
(An Exploration Stage Company)
Notes to Consolidated Financial Statements
September 30, 2012
NOTE 2 - GOING CONCERN
Lithium's financial statements are prepared using generally accepted accounting
principles applicable to a going concern, which contemplates that the Company
will continue in operation for the foreseeable future and will realize its
assets and liquidate its liabilities in the normal course of business. However,
Lithium has no current source of revenue, recurring losses and a deficit
accumulated during the exploration stage of $2,294,139 as of September 30, 2012.
These factors, among others, raise, substantial doubt about the Company's
ability to continue as a going concern. Lithium's management plans on raising
cash from public or private debt or equity financing, on an as-needed basis and
in the longer term, revenues from the acquisition, exploration and development
of mineral interests, if found. Lithium's ability to continue as a going concern
is dependent on these additional cash financings and, ultimately, upon achieving
profitable operations through the development of mineral interests. The
successful outcome of future activities cannot be determined at this time. The
accompanying financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
NOTE 3 - PREPAID EXPENSES
Prepaid expenses consisted of the following:
September 30, December 31,
2012 2011
-------- --------
Exploration costs $ -- $ 9,000
Bonds 40,869 39,754
Rent 500 298
Insurance 686 12,395
Office 5,391 5,804
Investor relations 802 6,168
Consulting -- --
-------- --------
Total prepaid expenses $ 48,248 $ 73,421
======== ========
NOTE 4 - PROPERTY AND EQUIPMENT
September 30, December 31,
2012 2011
-------- --------
Computer Equipment $ 2,433 $ 2,433
Less: Accumulated depreciation (2,218) (2,056)
-------- --------
Property and equipment, net $ 215 $ 377
======== ========
Depreciation expense was $162 and $498 for the nine months ended September 30,
2012 and 2011, respectively.
10
Lithium Corporation
(An Exploration Stage Company)
Notes to Consolidated Financial Statements
September 30, 2012
NOTE 5 - MINERAL PROPERTIES
Fish Lake Property
The Company has purchased a 100% interest in the Fish Lake property by making
staged payments of $350,000 worth of common stock. Title to the pertinent claims
was transferred to the Company through quit claim deed dated June 1st 2011, and
this quitclaim was recorded at the county level on August 3rd 2011, and at the
BLM on August 4th 2011. Quarterly stock disbursements were made on the following
schedule:
1st Disbursement: Within 10 days of signing agreement (paid)
2nd Disbursement: within 10 days of June 30, 2009 (paid)
3rd Disbursement: within 10 days of December 30, 2009 (paid)
4th Disbursement: within 10 days of March 31, 2010 (paid)
5th Disbursement: within 10 days of June 30, 2010 (paid)
6th Disbursement: within 10 days of September 30, 2010 (paid)
7th Disbursement: within 10 days of December 31, 2010 (paid)
8th Disbursement: within 10 days of March 31, 2011 (paid)
As at September 30, 2012, the Company has recorded $157,500 in acquisition costs
related to the Fish Lake Property.
Staked Properties
The Company has staked claims with various registries as summarized below:
Name Claims (Area in Acres) Amount
---- ---------------------- ------
San Emidio $5,719
The Company performs an impairment test on an annual basis to determine whether
a write-down is necessary with respect to the properties. The Company believes
no circumstances have occurred and no evidence has been uncovered that warrant a
write-down of the mineral properties other than those abandoned by management
and thus included in write-down of mineral properties. An impairment allowance
of $369,137 (2011: $37,033) was recorded during the nine months ended September
30, 2012.
NOTE 6 - CAPITAL STOCK
The Company is authorized to issue 3,000,000,000 shares of it $0.001 par value
common stock. On September 30, 2009, the Company effected a 60-for-1 forward
stock split of its $0.001 par value common stock.
All share and per share amounts have been retroactively restated to reflect the
splits discussed above.
Common Stock
On January 30, 2007, the Company issued 4,000,000 pre-split (240,000,000 post
split) shares of its common stock to founders for proceeds of $20,000.
During the year-ended December 31, 2008, the Company issued 470,000 pre-split
(28,200,000 post split) shares of its common stock for total proceeds of
$47,000.
11
Lithium Corporation
(An Exploration Stage Company)
Notes to Consolidated Financial Statements
September 30, 2012
NOTE 6 - CAPITAL STOCK (CONTINUED)
On October 9, 2009, the Company cancelled 220,000,000 shares of its common
stock. Also on October 9, 2009, the Company issued 12,350,000 shares of its
common stock for 100 percent of the issued and outstanding stock of Nevada
Lithium Corp. Refer to Note 3.
On January 10, 2010, the Company issued 53,484 shares of its common stock as
part of the Fish Lake Property acquisition.
On March 24, 2010, the Company issued 2,000,000 units in a private placement,
raising gross proceeds of $2,000,000, or $1.00 per unit. Each unit consists of
one common share in the capital of our company and one non-transferable common
share purchase warrant. Each whole common share purchase warrant
non-transferable entitles the holder thereof to purchase one share of common
stock in the capital of our company, for a period of twelve months commencing
the closing, at a purchase price of $1.20 per warrant share and at a purchase
price of $1.35 per warrant share between twelve and twenty-four months after
closing.
On April 30, 2010, the Company issued 38,068 shares of its common stock as part
of the Fish Lake Property acquisition.
On July 10, 2010, the Company issued 104,168 shares of its common stock as part
of the Fish Lake Property acquisition.
On October 10, 2010, the Company issued 171,568 of its common stock as part of
the Fish Lake Property acquisition.
On January 10, 2011, the Company issued 163,856 shares of its common stock as
part of the Fish Lake Property acquisition.
On April 10, 2011, the Company issued 230,264 shares of its common stock as part
of the Fish Lake Property acquisition.
On April 28, 2011, the Company issued 150,000 shares of its common stock as part
of a stock option exercise.
On May 5, 2011, the Company issued 200,000 shares of its common stock as part of
a stock option exercise.
There were 63,661,408 shares of common stock issued and outstanding as of
September 30, 2012.
12
Lithium Corporation
(An Exploration Stage Company)
Notes to Consolidated Financial Statements
September 30, 2012
NOTE 6 - CAPITAL STOCK (CONTINUED)
Stock Based Compensation
The Company granted 500,000 options at an exercise price of $0.28 to managing
directors. The Company granted another 750,000 options to non-managing
directors, and consultants for management services at an exercise price of
$0.24. These options were vested on the date of grant. During the year ended
December 31, 2011, 350,000 stock options were exercised for proceeds totalling
$84,000. The Company uses the Black-Scholes option valuation model to value
stock options granted. The Black- Scholes model was developed for use in
estimating the fair value of traded options that have no vesting restrictions
and are fully transferable. The model requires management to make estimates,
which are subjective and may not be representative of actual results.
Assumptions used to determine the fair value of the stock based compensation is
as follows:
Risk free interest rate 2.40%
Expected dividend yield 0%
Expected stock price volatility 93%
Expected life of options 5 years
Weighted Total
Total Average Weighted
Exercise Options Remaining Life Average Options
Prices Outstanding (Years) Exercise Price Exercisable
------ ----------- ------- -------------- -----------
$0.07 600,000 2.98 $0.07 600,000
$0.07 450,000 4.67 $0.07 450,000
Total stock-based compensation for the nine months ended September 30, 2012 was
$23,731 (2011: $Nil).
The following table summarizes the stock options outstanding at September 30,
2012:
Outstanding at
Issue Date Number Price Expiry Date September 30, 2012
---------- ------ ----- ----------- ------------------
September 23, 2010 600,000 $0.07 September 23, 2015 600,000
May 31, 2012 450,000 $0.07 May 31, 2017 450,000
13
Lithium Corporation
(An Exploration Stage Company)
Notes to Consolidated Financial Statements
September 30, 2012
NOTE 7 - INCOME TAXES
As of September 30, 2012, the Company had net operating loss carry forwards of
approximately $2,294,139 that may be available to reduce future years' taxable
income in varying amounts through 2033. Future tax benefits which may arise as a
result of these losses have not been recognized in these financial statements,
as their realization is determined not likely to occur and accordingly, the
Company has recorded a valuation allowance for the deferred tax asset relating
to these tax loss carry-forwards.
The provision for Federal income tax consists of the following:
Nine Months Nine Months
Ended Ended
September 30, September 30,
2012 2011
---------- ----------
Federal income tax benefit attributable to:
Current operations $ 207,346 $ 127,464
Less: valuation allowance (207,346) (127,464)
---------- ----------
Net provision for Federal income taxes $ 0 $ 0
========== ==========
The cumulative tax effect at the expected rate of 34% of significant items
comprising our net deferred tax amount is as follows:
September 30, December 31,
2012 2011
---------- ----------
Deferred tax asset attributable to:
Net operating loss carryover $ 780,007 $ 572,661
Less: valuation allowance (780,007) (572,661)
---------- ----------
Net deferred tax asset $ 0 $ 0
========== ==========
Due to the change in ownership provisions of the Tax Reform Act of 1986, net
operating loss carry forwards of approximately $2,294,139 for Federal income tax
reporting purposes are subject to annual limitations. Should a change in
ownership occur net operating loss carry forwards may be limited as to use in
future years.
NOTE 8 - SUBSEQUENT EVENTS
The Company has analyzed its operations subsequent to September 30, 2012 through
the date these financial statements were issued, and has determined that it does
not have any other material subsequent events to disclose.
14
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
FORWARD LOOKING STATEMENTS
This quarterly report contains forward-looking statements. These statements
relate to future events or our future financial performance. In some cases, you
can identify forward-looking statements by terminology such as "may", "should",
"expects", plans", "anticipates", "believes", "estimates", "predicts",
"potential" or "continue" or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known and unknown
risks, uncertainties and other factors that may cause our or our industry's
actual results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Although
we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Except as required by applicable law, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements to conform these statements to actual results.
Our unaudited consolidated financial statements are stated in United States
Dollars (US$) and are prepared in accordance with United States Generally
Accepted Accounting Principles. The following discussion should be read in
conjunction with our financial statements and the related notes that appear
elsewhere in this quarterly report. The following discussion contains
forward-looking statements that reflect our plans, estimates and beliefs. Our
actual results could differ materially from those discussed in the
forward-looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed below and elsewhere
in this quarterly report.
Our financial statements are stated in United States Dollars (US$) and are
prepared in accordance with United States Generally Accepted Accounting
Principles.
In this quarterly report, unless otherwise specified, all dollar amounts are
expressed in United States dollars and all references to "common shares" refer
to the common shares in our capital stock.
As used in this quarterly report, the terms "we," "us," "our" and "our company"
mean Lithium Corporation, unless otherwise indicated and the term "Nevada
Lithium" means our wholly owned subsidiary, Nevada Lithium Corporation, a Nevada
corporation.
GENERAL OVERVIEW
We were incorporated under the laws of the State of Nevada on January 30, 2007
under the name "Utalk Communications Inc." At inception, we were a development
stage corporation engaged in the business of developing and marketing a
call-back service using a call-back platform. Because we were not successful in
implementing our business plan, we considered various alternatives to ensure the
viability and solvency of our company.
On August 31, 2009, we entered into a letter of intent with Nevada Lithium
regarding a business combination which may be effected in one of several
different ways, including an asset acquisition, merger of our company and Nevada
Lithium, or a share exchange whereby we would purchase the shares of Nevada
Lithium from its shareholders in exchange for restricted shares of our common
stock.
Effective September 30, 2009, we affected a 1 old for 60 new forward stock split
of our issued and outstanding common stock. As a result, our authorized capital
increased from 50,000,000 shares of common stock with a par value of $0.001 to
3,000,000,000 shares of common stock with a par value of $0.001 and our issued
and outstanding shares increased from 4,470,000 shares of common stock to
268,200,000 shares of common stock.
15
Also effective September 30, 2009, we changed our name from "Utalk
Communications, Inc." to "Lithium Corporation", by way of a merger with our
wholly owned subsidiary Lithium Corporation, which was formed solely for the
change of name. The name change and forward stock split became effective with
the Over-the-Counter Bulletin Board at the opening for trading on October 1,
2009 under the stock symbol "LTUM". Our CUSIP number is 536804 107.
On October 9, 2009, we entered into a share exchange agreement with Nevada
Lithium and the shareholders of Nevada Lithium. The closing of the transactions
contemplated in the share exchange agreement and the acquisition of all of the
issued and outstanding common stock in the capital of Nevada Lithium occurred on
October 19, 2009. In accordance with the closing of the share exchange
agreement, we issued 12,350,000 shares of our common stock to the former
shareholders of Nevada Lithium in exchange for the acquisition, by our company,
of all of the 12,350,000 issued and outstanding shares of Nevada Lithium. Also,
pursuant to the terms of the share exchange agreement, a director of our company
cancelled 220,000,000 restricted shares of our common stock.
OUR CURRENT BUSINESS
We are an exploration stage mining company engaged in the identification,
acquisition and exploration of metals and minerals with a focus on lithium
mineralization on properties located in Nevada.
Our current operational focus is to conduct exploration activities on our
properties in Nevada, known as the Fish Lake Valley property, the Salt Wells
property, and the San Emidio prospect.
FISH LAKE VALLEY PROPERTY
Fish Lake Valley is a lithium enriched playa (also known as a salar, or salt
pan), which is located in west central Nevada in northern Esmeralda county, and
the property is roughly centered at 417050E 4195350N (NAD 27 CONUS). We
currently hold ninety two - eighty (80) acre Association Placer claims that
cover approximately 7,360 acres. Lithium-enriched Tertiary-era Fish Lake
formation Rhyolitic tuffs or ash flow tuffs have accumulated in a valley or
basinal environment. Over time interstitial formational waters in contact with
these tuffs, have become enriched in lithium, which could possibly be amenable
to the extraction by evaporative methods.
The property was originally held under mining lease purchase agreement dated
June 1, 2009 between Nevada Lithium, and Nevada Alaska Mining Co. Inc., Robert
Craig, Barbara Craig, and Elizabeth Dickman. Nevada Lithium had agreed to issue
the vendors $350,000 worth of common stock of our company in eight regular
disbursements. To date all disbursements have been made of stock worth a total
of $350,000, and claim ownership has been transferred to our company.
The geological setting at Fish Lake Valley is highly analogous to the salars of
Chile, Bolivia and Peru, and more importantly Clayton Valley, where Chemetall
has its Silver Peak lithium-brine operation. Access is excellent in Fish Lake
Valley with all weather gravel roads leading to the property from State Highways
264, and 265, and maintained gravel roads ring the playa. Power is available
approximately 10 miles from the property, and the village of Dyer is
approximately 12 miles to the south, while the town of Tonopah Nevada is
approximately 50 miles to the East.
Our company has completed a number of geochemical and geophysical studies on the
property, and conducted a short drill program on the periphery of the playa in
the Fall of 2010. Near-surface brine sampling during the Spring of 2011 has
outlined a boron/lithium/potassium anomaly that is roughly 1.3 x 2 miles long,
which has a smaller higher grade core where lithium mineralization ranges from
100 to 150 mg/L, with boron ranging from 1,500 to 2,670 mg/L, and potassium from
5,400 to 8,400 mg/L. Our company had planned to drill this property during the
Summer/Fall of 2011, but it had been considerably wetter than normal there, and
the opportunity to safely drill this property did not present itself in 2011.
Our company plans to drill this property as soon as feasible.
16
SALT WELLS
The Salt Wells property was acquired through staking a 12,320 acre parcel that
covers the Eightmile Basin, a playa, which lies approximately 15 miles to the
southeast of Fallon, the county seat of Churchill County, Nevada. In 2011 the
property was reduced through allowing a number of non-prospective, non-strategic
claims to lapse. Exploratory drilling in Fall 2011 was disappointing and all the
remaining claims here were allowed to lapse in September 2012.
SAN EMIDIO
The San Emidio property was acquired through the staking of claims in September
2011. The twenty - eighty (80) acre Association Placer claims staked here cover
an area of approximately 1,600 acres. The property is approximately 65 miles
north-northeast of Reno, Nevada, and has excellent infrastructure.
We developed this prospect during 2009, and 2010 through surface sampling, and
the early reconnaissance sampling determined that anomalous values for lithium
occur in the playa sediments over a good portion of the playa. This sampling
appeared to indicate that the most prospective areas on the playa may be on the
newly staked block proximal to the southern margin of the basin, where it is
possible the structures that are responsible for the geothermal system here may
also have influenced lithium deposition in sediments.
In Spring 2011, our company conducted near-surface brine sampling and a high
resolution gravity geophysical survey in Summer/Fall 2011. Our company permitted
a 7 hole drilling program with the Bureau of Land Management in late Fall 2011,
and a direct push drill program was commenced in early February 2012. Drilling
here delineated a narrow elongate shallow brine reservoir which is greater than
2.5 miles length, and which is adjacent to a basinal feature outlined by the
earlier gravity survey. Two values of over 20 milligrams/liter lithium were
obtained from two holes located centrally in this brine anomaly. Our company
drilled this prospect in October, and is currently waiting on results.
OTHER
Our company allowed all 62 Association Placer Claims held at our Cortez Prospect
in Lander County, Nevada to lapse in September of 2011 as, although drilling
there in the Summer of 2011 determined that a considerable volume of brine can
be found locally, lithium contents were low and our company concluded that it
would perhaps be more prudent to focus resources elsewhere.
We are currently developing plans for exploring other locations which are felt
to be prospective for hosting lithium mineralization, as well as evaluating
opportunities brought to the company by third parties.
RESULTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 2012 COMPARED TO THE THREE MONTHS ENDED
SEPTEMBER 30, 2011
We had a net loss of $443,302 for the three month period ended September 30,
2012, which was $259,481 more than the net loss of $183,821 for the three month
period ended September 30, 2011. The significant change in our results over the
two periods is primarily the result of increase in a write-down of mineral
properties offset by decreases in exploration expense.
The following table summarizes key items of comparison and their related
increase (decrease) for the three month periods ended September 30, 2012 and
2011:
17
Change Between
Three Month Period
Ended
Three Months Three Months September 30, 2012
Ended Ended and
September 30, September 30, September 30,
2012 2011 2011
---------- ---------- ----------
Professional fees $ 13,273 $ 5,359 $ 7,914
Amortization 54 -- 54
Exploration expenses 16,700 102,851 (86,151)
Consulting fees 18,550 6,258 12,292
Insurance expense 3,903 3,913 (10)
Investor relations 11,852 15,302 (3,450)
Transfer agent and filing fees 2,498 4,321 (1,823)
Travel 5,396 4,315 1,081
Write-down of mineral properties 369,137 37,033 332,104
General and administrative 2,257 4,700 (2,443)
Interest income (318) (231) (87)
---------- ---------- ----------
Net loss $ 443,302 $ 183,821 $ 259,481
========== ========== ==========
NINE MONTHS ENDED SEPTEMBER 30, 2012 COMPARED TO THE NINE MONTHS ENDED SEPTEMBER
30, 2011
We had a net loss of $609,842 for the nine month period ended September 30,
2012, which was $234,949 more than the net loss of $374,893 for the nine month
period ended September 30, 2011. The significant change in our results over the
two periods is primarily the result of increase in a write-down of mineral
properties offset by decreases in exploration expense.
The following table summarizes key items of comparison and their related
increase (decrease) for the nine month periods ended September 30, 2012 and
2011:
Change Between
Nine Month Period
Ended
Nine Months Nine Months September 30, 2012
Ended Ended and
September 30, September 30, September 30,
2012 2011 2011
---------- ---------- ----------
Professional fees $ 46,612 $ 15,608 $ 31,004
Amortization 162 498 (336)
Exploration expenses 49,459 191,759 (142,300)
Consulting fees 44,768 34,420 10,348
Insurance expense 11,709 11,687 22
Investor relations 36,600 49,686 (13,086)
Promotion 2,137 -- 2,137
Transfer agent and filing fees 6,704 9,516 (2,812)
Travel 13,178 15,320 (2,142)
Stock option compensation 23,731 -- 23,731
Write-down of mineral properties 369,137 37,033 332,104
General and administrative 7,070 10,274 (3,204)
Other income (671) -- (671)
Interest income (754) (908) 154
---------- ---------- ----------
Net loss $ 609,842 $ 374,893 $ 234,949
========== ========== ==========
18
REVENUE
We have not earned any revenues since our inception and we do not anticipate
earning revenues in the upcoming quarter.
LIQUIDITY AND CAPITAL RESOURCES
Our balance sheet as of September 30, 2012, reflects current assets of $798,615.
We had cash in the amount of $749,693 and a working capital in the amount of
$779,822 as of September 30, 2012. We have sufficient working capital to enable
us to carry out our stated plan of operation for the next twelve months.
WORKING CAPITAL
At At
September 30, December 31,
2012 2011
---------- ----------
Current assets $ 798,615 $1,044,125
Current liabilities 18,793 21,730
---------- ----------
Working capital $ 779,822 $1,022,395
========== ==========
We anticipate generating losses and, therefore, may be unable to continue
operations in the future. If we require additional capital, we would have to
issue debt or equity or enter into a strategic arrangement with a third party.
CASH FLOWS
Nine Months Ended
September 30,
2012 2011
---------- ----------
Net cash provided by (used in) operating activities $ (194,577) $ (350,111)
Net cash provided by (used in) investing activities (25,760) (40,543)
Net cash provided by (used in) financing activities -- 84,000
---------- ----------
Net increase (decrease) in cash during period $ (220,337) $ (306,654)
========== ==========
OPERATING ACTIVITIES
Net cash flow used in operating activities during the nine months ended
September 30, 2012 was $194,577, a decrease of $155,534 from the $350,111 net
cash outflow during the nine months ended September 30, 2011.
INVESTING ACTIVITIES
The primary driver of cash used in investing activities was capital spending in
the maintenance of our company's properties.
Cash used in investing activities during the nine months ended September 30,
2012 was $25,760, which was a $14,783 decrease from the $40,543 of cash used
investing activities during the nine months ended September 30, 2011. This
decrease in the cash used in investing activities was primarily due to a less
aggressive exploration program during the period.
FINANCING ACTIVITIES
Cash provided by financing activities during the nine months ended September 30,
2012 was $Nil as compared to the $84,000 in cash provided by financing
activities during the nine months ended September 30, 2011.
19
We estimate that we will spend approximately $200,000 on general and
administrative expenses, $250,000 on exploration and $50,000 on travel over the
next 12 months. Specifically, we estimate our operating expenses and working
capital requirements for the next 12 months to be as follows:
ESTIMATED NET EXPENDITURES DURING THE NEXT TWELVE MONTHS
$
--------
General, Administrative Expenses 200,000
Exploration Expenses 250,000
Travel 50,000
--------
TOTAL 500,000
========
We have suffered recurring losses from operations. The continuation of our
company is dependent upon our company attaining and maintaining profitable
operations and raising additional capital as needed.
The continuation of our business is dependent upon obtaining further financing,
a successful program of exploration and/or development, and, finally, achieving
a profitable level of operations. The issuance of additional equity securities
by us could result in a significant dilution in the equity interests of our
current stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.
There are no assurances that we will be able to obtain further funds required
for our continued operations. As noted herein, we are pursuing various financing
alternatives to meet our immediate and long-term financial requirements. There
can be no assurance that additional financing will be available to us when
needed or, if available, that it can be obtained on commercially reasonable
terms. If we are not able to obtain the additional financing on a timely basis,
we will be unable to conduct our operations as planned, and we will not be able
to meet our other obligations as they become due. In such event, we will be
forced to scale down or perhaps even cease our operations.
Cash on hand as of September 30, 2012 was $749,693.
We are not aware of any known trends, demands, commitments, events or
uncertainties that will result in or that are reasonably likely to result in our
liquidity increasing or decreasing in any material way.
FUTURE FINANCINGS
We anticipate continuing to rely on equity sales of our common stock in order to
continue to fund our business operations. Issuances of additional shares will
result in dilution to our existing stockholders. There is no assurance that we
will achieve any additional sales of our equity securities or arrange for debt
or other financing to fund our planned business activities.
We presently do not have any arrangements for additional financing for the
expansion of our exploration operations, and no potential lines of credit or
sources of financing are currently available for the purpose of proceeding with
our plan of operations.
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements that have or are reasonably likely to
have a current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, and capital
expenditures or capital resources that are material to stockholders.
20
CRITICAL ACCOUNTING POLICIES
EXPLORATION STAGE COMPANY
The accompanying financial statements have been prepared in accordance with
generally accepted accounting principles related to accounting and reporting by
exploration stage companies. An exploration stage company is one in which
planned principal operations have not commenced or if its operations have
commenced, there has been no significant revenues there from.
ACCOUNTING BASIS
The Company uses the accrual basis of accounting and accounting principles
generally accepted in the United States of America ("GAAP" accounting). The
Company has adopted a December 31 fiscal year end.
CASH AND CASH EQUIVALENTS
Cash includes cash on account, demand deposits, and short-term instruments with
maturities of three months or less.
CONCENTRATIONS OF CREDIT RISK
Our company maintains its cash in bank deposit accounts, the balances of which
at times may exceed federally insured limits. Our company continually monitors
its banking relationships and consequently has not experienced any losses in
such accounts. Our company believes it is not exposed to any significant credit
risk on cash and cash equivalents.
USE OF ESTIMATES
The preparation of consolidated financial statements in conformity with
generally accepted accounting principles 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 amount of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
REVENUE RECOGNITION
Our company is in the exploration stage and has yet to realize revenues from
operations. Once our company has commenced operations, it will recognize
revenues when delivery of goods or completion of services has occurred provided
there is persuasive evidence of an agreement, acceptance has been approved by
its customers, the fee is fixed or determinable based on the completion of
stated terms and conditions, and collection of any related receivable is
probable.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of our wholly-owned
subsidiary. All material inter-company transactions have been eliminated.
LOSS PER SHARE
Basic loss per share is computed by dividing loss available to common
shareholders by the weighted average number of common shares outstanding during
the year. The computation of diluted earnings per share assumes the conversion,
exercise or contingent issuance of securities only when such conversion,
exercise or issuance would have a dilutive effect on earnings per share. The
dilutive effect of convertible securities is reflected in diluted earnings per
share by application of the "if converted" method. In the periods in which a
21
loss is incurred, the effect of potential issuances of shares under options and
warrants would be anti-dilutive, and therefore basic and diluted losses per
share are the same.
COMPUTER EQUIPMENT
Computer equipment is stated on the basis of historical cost less accumulated
depreciation. Depreciation is provided using the straight-line method over the
estimated useful lives of the assets which has been estimated as 2 years.
Impairment losses are recorded on computer equipment used in operations when
indicators of impairment are present and the undiscounted cash flows estimated
to be generated by those assets are less than the assets' carrying amount.
INCOME TAXES
The asset and liability approach is used to account for income taxes by
recognizing deferred tax assets and liabilities for the expected future tax
consequences of temporary differences between the carrying amounts and the tax
basis of assets and liabilities.
FINANCIAL INSTRUMENTS
Our company's financial instruments consist of cash, accounts receivable,
prepaid expenses, and accounts payable and accrued liabilities. Unless otherwise
noted, it is management's opinion that our company is not exposed to significant
interest, currency or credit risks arising from these financial instruments.
Because of the short maturity and capacity of prompt liquidation of such assets
and liabilities, the fair value of these financial instruments approximate their
carrying values, unless otherwise noted.
MINERAL PROPERTIES
Costs of exploration, carrying and retaining unproven mineral lease properties
are expensed as incurred. Mineral property acquisition costs are capitalized
including licenses and lease payments. Although our company has taken steps to
verify title to mineral properties in which it has an interest, these procedures
do not guarantee our company's title. Such properties may be subject to prior
agreements or transfers and title may be affected by undetected defects.
Impairment losses are recorded on mineral properties used in operations when
indicators of impairment are present and the undiscounted cash flows estimated
to be generated by those assets are less than the assets' carrying amount.
Impairment of $518,746 was recorded since inception relating to the abandonment
of some mineral claims.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
As a "smaller reporting company", we are not required to provide the information
required by this Item.
ITEM 4. CONTROLS AND PROCEDURES
MANAGEMENT'S REPORT ON DISCLOSURE CONTROLS AND PROCEDURES
We maintain disclosure controls and procedures that are designed to ensure that
information required to be disclosed in our reports filed under the SECURITIES
EXCHANGE ACT OF 1934, as amended, is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission's rules and forms, and that such information is accumulated and
communicated to our management, including our president (our principal executive
officer, principal financial officer and principle accounting officer) to allow
for timely decisions regarding required disclosure.
As of the end of the quarter covered by this report, we carried out an
evaluation, under the supervision and with the participation of our president
(our principal executive officer, principal financial officer and principle
accounting officer), of the effectiveness of the design and operation of our
disclosure controls and procedures. Based on the foregoing, our president (our
22
principal executive officer, principal financial officer and principle
accounting officer) concluded that our disclosure controls and procedures were
effective as of the end of the period covered by this quarterly report.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
During the period covered by this report there were no changes in our internal
control over financial reporting that materially affected, or are reasonably
likely to materially affect, our internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We know of no material, existing or pending legal proceedings against our
company, nor are we involved as a plaintiff in any material proceeding or
pending litigation. There are no proceedings in which any of our directors,
executive officers or affiliates, or any registered or beneficial stockholder,
is an adverse party or has a material interest adverse to our interest.
ITEM 1A. RISK FACTORS
As a "smaller reporting company", we are not required to provide the information
required by this Item.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS
Exhibit No. Description
----------- -----------
(3) ARTICLES OF INCORPORATION AND BYLAWS
3.1 Articles of Incorporation (Incorporated by reference to our
Registration Statement on Form SB-2 filed on December 21, 2007).
3.2 Bylaws (Incorporated by reference to our Registration Statement
on Form SB-2 filed on December 21, 2007).
3.3 Articles of Merger (Incorporated by reference to our Current
Report on Form 8-K filed on October 2, 2009).
23
Exhibit No. Description
----------- -----------
3.4 Certificate of Change (Incorporated by reference to our Current
Report on Form 8-K filed on October 2, 2009).
(4) INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING
INDENTURES
4.1 2009 Stock Option Plan (Incorporated by reference to our Current
Report on Form 8-K filed on December 30, 2009).
(10) MATERIAL CONTRACTS
10.1 Share Exchange Agreement dated October 9, 2009, between our
company, Nevada Lithium Corporation and the selling shareholders
of Nevada Lithium Corporation (Incorporated by reference to our
Current Report on Form 8-K filed on October 26, 2009).
10.2 Lease Purchase Agreement dated June 1, 2009 between Nevada
Lithium Corporation, Nevada Mining Co., Inc., Robert Craig,
Barbara Craig and Elizabeth Dickman. (Incorporated by reference
to our Current Report on Form 8-K filed on October 26, 2009).
10.3 Lease Agreement dated March 16, 2009 between Nevada Lithium
Corporation and Cerro Rico Ventures LLC (incorporated by
reference to our Current Report on Form 8-K filed on October 26,
2009).
(21) SUBSIDIARIES OF THE REGISTRANT
21.1 Nevada Lithium Corporation, a Nevada corporation
(31) RULE 13A-14 (D)/15D-14D) CERTIFICATIONS
31.1* Section 302 Certification by the Principal Executive Officer and
Principal Financial Officer.
(32) SECTION 1350 CERTIFICATIONS
32.1* Section 906 Certification by the Principal Executive Officer and
Principal Financial Officer.
101** INTERACTIVE DATA FILE
101.INS XBRL Instance Document
101.SCH XBRL Taxonomy Extension Schema Document
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF XBRL Taxonomy Extension Definition Linkbase Document
101.LAB XBRL Taxonomy Extension Label Linkbase Document
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document
----------
* Filed herewith.
** Furnished herewith. Pursuant to Rule 406T of Regulation S-T, the
Interactive Data Files on Exhibit 101 hereto are deemed not filed or part
of any registration statement or prospectus for purposes of Sections 11 or
12 of the Securities Act of 1933, are deemed not filed for purposes of
Section 18 of the Securities and Exchange Act of 1934, and otherwise are
not subject to liability under those sections.
24
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
LITHIUM CORPORATION
(Registrant)
Dated: November 14, 2012 /s/ Tom Lewis
---------------------------------------
Tom Lewis
President, Treasurer, Secretary and
Director (Principal Executive Officer,
Principal Financial Officer and
Principal Accounting Officer)
25