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 June 30, 2016
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 000-54332
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.)
1031 Railroad St. Ste. 102B, Elko, Nevada 89801
(Address of principal executive offices) (Zip Code)
(775) 410-5287
(Registrant's telephone number, including area code)
(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.
81,845,075 common shares issued and outstanding as of August 10, 2016
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 14
Item 3. Quantitative and Qualitative Disclosures About Market Risk 25
Item 4. Controls and Procedures 25
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 26
Item 1A. Risk Factors 26
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 26
Item 3. Defaults Upon Senior Securities 26
Item 4. Mine Safety Disclosures 26
Item 5. Other Information 26
Item 6. Exhibits 27
SIGNATURES 29
2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Our unaudited interim financial statements for the six month period ended June
30, 2016 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
Condensed Balance Sheets
(Unaudited)
June 30, 2016 December 31, 2015
------------- -----------------
ASSETS
CURRENT ASSETS
Cash $ 356,894 $ 191,465
Marketable securities 261,000 --
Deposits 700 700
Prepaid expenses 47,225 43,579
------------ ------------
Total Current Assets 665,819 235,744
OTHER ASSETS
Investment 83,997 72,297
Mineral properties 159,859 159,859
------------ ------------
TOTAL ASSETS $ 909,675 $ 467,900
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 13,762 $ 7,500
Allowance for optioned properties 491,000 --
------------ ------------
TOTAL CURRENT LIABILITIES 504,762 7,500
------------ ------------
TOTAL LIABILITIES 504,762 7,500
------------ ------------
Commitments and contingencies
STOCKHOLDERS' EQUITY
Common stock, 3,000,000,000 shares authorized, par value $0.01;
79,861,408 and 77,361,408 common shares outstanding, respectively 79,862 77,362
Additional paid in capital 3,447,780 3,387,780
Additional paid in capital - options 181,335 159,301
Additional paid in capital - warrants 303,422 303,422
Accumulated deficit (3,607,486) (3,467,465)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 404,913 460,400
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 909,675 $ 467,900
============ ============
The accompanying notes are an integral part of these financial statements.
4
LITHIUM Corporation
Condensed Statements of Operations
(Unaudited)
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
June 30, 2016 June 30, 2015 June 30, 2016 June 30, 2015
------------- ------------- ------------- -------------
REVENUE $ -- $ -- $ -- $ --
------------ ------------ ------------ ------------
OPERATING EXPENSES
Professional fees 9,750 6,747 22,190 19,364
Exploration expenses 15,673 10,922 32,693 27,794
Consulting fees 11,304 21,300 29,304 46,200
Insurance expense 5,633 4,266 9,858 8,638
Investor relations 3,121 2,685 10,404 6,060
Stock based compensation -- -- 22,034 --
Transfer agent and filing fees 2,607 3,705 5,213 5,980
Travel 663 6,094 3,448 10,554
General and administrative expenses 3,383 2,623 4,897 5,855
------------ ------------ ------------ ------------
TOTAL OPERATING EXPENSES 52,134 58,342 140,041 130,445
------------ ------------ ------------ ------------
LOSS FROM OPERATIONS (52,134) (58,342) (140,041) (130,445)
OTHER INCOME (EXPENSES)
Interest income -- 114 20 114
------------ ------------ ------------ ------------
TOTAL OTHER INCOME (EXPENSE) -- 114 20 114
------------ ------------ ------------ ------------
LOSS BEFORE INCOME TAXES (52,134) (58,228) (140,021) (130,331)
PROVISION FOR INCOME TAXES -- -- -- --
------------ ------------ ------------ ------------
NET LOSS $ (52,134) $ (58,228) $ (140,021) $ (130,331)
============ ============ ============ ============
NET LOSS PER SHARE: BASIC AND DILUTED $ (0.00) $ (0.00) $ (0.00) $ (0.00)
============ ============ ============ ============
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING:
BASIC AND DILUTED 77,664,741 74,661,408 78,718,867 74,661,408
============ ============ ============ ============
The accompanying notes are an integral part of these financial statements.
5
LITHIUM Corporation
Statements of Stockholders' Equity (Deficit)
Deficit
Additional Additional Accumulated
Common Stock Additional Paid-in Paid-in During the Total
------------------ Paid-in Capital - Capital - Development Stockholders'
Shares Amount Capital Warrants Options Stage Equity
------ ------ ------- -------- ------- ----- ------
Balance, December 31, 2014 74,661,408 $ 74,662 $ 3,368,453 $ 257,949 $ 159,301 $(3,184,726) $ 675,639
Stock issued for cash 2,700,000 2,700 19,327 45,473 -- -- 67,500
Net loss -- -- -- -- -- (282,739) (282,739)
----------- -------- ----------- --------- --------- ----------- ----------
Balance, December 31, 2015 77,361,408 77,362 3,387,780 303,422 159,301 (3,467,465) 460,400
Stock issued for cash 2,500,000 2,500 60,000 -- -- -- 62,500
Stock based compensation -- -- -- -- 22,034 -- 22,034
Net loss -- -- -- -- -- (140,021) (140,021)
----------- -------- ----------- --------- --------- ----------- ----------
Balance, June 30, 2016 79,861,408 $ 79,862 $ 3,447,780 $ 303,422 $ 181,335 $(3,607,486) $ 404,913
=========== ======== =========== ========= ========= =========== ==========
The accompanying notes are an integral part of these financial statements.
6
LITHIUM Corporation
Condensed Statements of Cash Flows
(Unaudited)
Six Months Six Months
Ended Ended
June 30, 2016 June 30, 2015
------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss for the period $ (140,021) $ (130,331)
Adjustment to reconcile net loss to net
cash used in operating activities
Stock based compensation 22,034 --
Changes in assets and liabilities:
(Increase) decrease in prepaid expenses (3,646) (1,525)
Increase (decrease) in accounts payable and accrued liabilities 6,262 (7,184)
---------- ----------
Net Cash Used in Operating Activities (115,371) (139,040)
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of long term investment (11,700) --
---------- ----------
Net Cash Used in Investing Activities (11,700) --
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITY:
Shares issued for cash 62,500 --
Cash from properties 230,000
---------- ----------
Net Cash Used in Financing Activities 292,500 --
---------- ----------
Decrease in cash 165,429 (139,040)
Cash, beginning of period 191,465 379,512
---------- ----------
Cash, end of period $ 356,894 $ 240,472
========== ==========
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest $ -- $ --
========== ==========
Cash paid for income taxes $ -- $ --
========== ==========
NON-CASH TRANSACTIONS:
Marketable securities received as consideration for mineral
property option $ 248,000 $ --
========== ==========
The accompanying notes are an integral part of these financial statements.
7
LITHIUM Corporation
Notes to the Condensed Financial Statements
June 30, 2016 (Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Lithium Corporation (formerly Utalk Communications Inc.) (the "Company") 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 9, 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 flake graphite prospects in British Columbia and is
currently in the exploration stage.
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 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 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 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.
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.
8
LITHIUM Corporation
Notes to the Condensed Financial Statements
June 30, 2016 (Unaudited)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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, deposits, 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 $0 and $0 was recorded during the periods ended June 30, 2016 and
2015, respectively.
RECENT ACCOUNTING PRONOUNCEMENTS
In January 2016, the Financial Accounting Standards Board ("FASB"), issued
Accounting Standards Update ("ASU") 2016-01, "Financial Instruments-Overall
(Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial
Liabilities," which amends the guidance in U.S. generally accepted accounting
principles on the classification and measurement of financial instruments.
Changes to the current guidance primarily affect the accounting for equity
investments, financial liabilities under the fair value option, and the
presentation and disclosure requirements for financial instruments. In addition,
the ASU clarifies guidance related to the valuation allowance assessment when
recognizing deferred tax assets resulting from unrealized losses on
available-for-sale debt securities. The new standard is effective for fiscal
years and interim periods beginning after December 15, 2017, and are to be
adopted by means of a cumulative-effect adjustment to the balance sheet at the
beginning of the first reporting period in which the guidance is effective.
Early adoption is not permitted except for the provision to record fair value
changes for financial liabilities under the fair value option resulting from
instrument-specific credit risk in other comprehensive income. The Company is
currently evaluating the impact of adopting this standard.
In November 2015, the FASB issued ASU 2015-17, "Income Taxes (Topic 740):
Balance Sheet Classification of Deferred Taxes," which simplifies the
presentation of deferred income taxes by requiring that deferred tax liabilities
and assets be classified as noncurrent in a classified statement of financial
position. This ASU is effective for financial statements issued for annual
periods beginning after December 16, 2016, and interim periods within those
annual periods. The adoption of this standard will not have any impact on the
Company's financial position, results of operations and disclosures.
9
LITHIUM Corporation
Notes to the Condensed Financial Statements
June 30, 2016 (Unaudited)
NOTE 2 - PREPAID EXPENSES
Prepaid expenses consisted of the following at June 30, 2016 and December 31,
2015:
June 30, 2016 December 31, 2015
------------- -----------------
Bonds $ 26,061 $ 26,061
Transfer agent fees 1,964 3,927
Insurance 12,675 5,633
Office Misc 225 520
Investor relations 6,300 7,438
-------- --------
Total prepaid expenses $ 47,225 $ 43,579
======== ========
NOTE 3 - INVESTMENT
Effective April 23, 2014, the Company entered into an operating agreement with
All American Resources, L.L.C and TY & Sons Investments Inc. with respect to
Summa, LLC, a Nevada limited liability company incorporated on December 12,
2013, wherein we hold a 25% membership. The Company's capital contribution to
Summa, LLC was $125,000, of which $100,000 was in cash and the balance in
services.
The Company participated in the formation of Summa, which holds 88 fee-title
patented lode claims, which cover approximately 1,191.3 acres of prospective
mineral lands. The Company has recently signed a joint operating agreement with
the other participants to govern the conduct of Summa, and the development of
the lands. The Company's president, Tom Lewis, has been named as a managing
member of Summa.
The investment has been accounted for using the equity method of accounting. As
such, the Company shall record its proportionate share of income or loss in the
investment. As of June 30, 2016, the Company has contributed $116,700 recorded a
loss on investment of $32,703.
NOTE 4 - MINERAL PROPERTIES
FISH LAKE PROPERTY
The Company 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 1, 2011, and this
quit claim was recorded at the county level on August 3, 2011 and at the BLM on
August 4, 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 June 30, 2016, the Company has recorded $436,764 in acquisition costs
related to the Fish Lake Property and associated impairment of $276,908 related
to abandonment of claims. The carrying value of the Fish Lake Property was
$159,859 as of June 30, 2016.
10
LITHIUM Corporation
Notes to the Condensed Financial Statements
June 30, 2016 (Unaudited)
NOTE 4 - MINERAL PROPERTIES (CONTINUED)
FISH LAKE PROPERTY (CONTINUED)
On March 10, 2016, the Company entered into an agreement with respect to the
Fish Lake Property whereby the purchaser may earn an 80% interest in the
property for payments of $300,000, 400,000 shares and work performed on the
property over the next three years totaling $1,100,000. Should these terms be
met, the purchaser has the ability to purchase the remaining 20% of the property
for $1,000,000. The Company shall retain a 2.5% NSR on the property should they
sell 100% of their interest.
To date, the Company has received $100,000 and 200,000 common shares in relation
to the option agreement.
MT. HEIMDAL PROPERTY
The Company entered into an agreement in April 2013, as amended in August 2013,
whereby it earned a 100% interest in the Mt. Heimdal Flake Graphite property in
BC, subject to a 1.5% net overriding royalty. The carrying value of the Mt.
Heimdal property is $0 (2014: $300) as of December 30, 2015. During the
year-ended December 31, 2015, the Company incurred a $300 impairment allowance
on the property.
SUGAR PROPERTY
In June 2013, the company purchased claims in the Cherryville, BC area for
250,000 shares of the Company's common stock. Since this time the company has
expanded the claim block considerably, and has expended approximately $45,000 to
date exploring this property for flake graphite deposits. In January, 2014, the
company agreed to buy back the shares issued pursuant to the June agreement for
$2,500. The buy-back was completed in April, 2014 and recorded the purchase of
stock in the Company's equity.
STAKED PROPERTIES
The Company has staked claims with various registries as summarized below:
Net Carry
Name Claims Cost Impairment Value
---- ------ ---- ---------- -----
San Emidio 20 (1,600 acres) $11,438 $(11,438) $ 0
Cherryville/BC Sugar 8019.41 (hectares) $21,778 $(21,778) $ 0
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. During the year-ended
December 31, 2015, the Company recorded in impairment charge of $21,494 related
to the properties.
On May 3, 2016, the Company entered into an agreement with respect to the Fish
Lake Property whereby the purchaser may earn an 80% interest in the property for
payments of $100,000, 300,000 shares and work performed on the property over the
next three years totaling $600,000. Should these terms be met, the purchaser has
the ability to purchase the remaining 20% of the property for $1,000,000. The
Company shall retain a 2.5% NSR on the property should they sell 100% of their
interest.
To date, the Company has received $100,000 and 100,000 common shares in relation
to the option agreement.
11
LITHIUM Corporation
Notes to the Condensed Financial Statements
June 30, 2016 (Unaudited)
NOTE 5 - 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 June 6, 2013, the Company issued 250,000 shares of its common stock as part
of the Cherryville property acquisition located in British Columbia.
On January 17, 2014 the Company repurchased the 250,000 shares of its common
stock issued as part of the Cherryville property acquisition for $2,500. The
shares were returned to the treasury and retired in April 2014.
On October 15, 2016, the Company issued 2,700,000 shares of its common stock for
proceeds of $67,500.
During the quarter ended June 30, 2016, the Company issued 2,300,000 common
shares for gross proceeds of $57,000 related to a private placement.
During the quarter ended June 30, 2016, the Company issued 200,000 common shares
for gross proceeds of $5,000 pursuant to the exercise of stock options.
There were 79,861,408 shares of common stock issued and outstanding as of June
30, 2016.
WARRANTS
On October 15, 2015, the Company issued 2,700,000 warrants exercisable at $0.05
for the first 12 months after closing and $0.075 for the following 12 months
after closing. The fair value of the warrants has been measured at $45,473.
STOCK BASED COMPENSATION
On March 15, 2013, all pre-existing options were modified to exercise prices of
$0.045. The modification resulted in stock-based compensation of $8,848. Also on
March 15, 2013, the Company issued an additional 200,000 options at an exercise
price of $0.045 to consultants for management services. These options were
vested on the date of grant and resulted in stock-based compensation of $7,794.
The Company uses the Black-Scholes option valuation model to value stock
options. 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 remaining stock options are as follows:
Modification New Options
------------ -----------
Risk free interest rate 0.35% 0.67%
Expected dividend yield 0% 0%
Expected stock price volatility 129% 129%
Expected life of options 3 years 5 years
12
LITHIUM Corporation
Notes to the Condensed Financial Statements
June 30, 2016 (Unaudited)
NOTE 5 - CAPITAL STOCK (CONTINUED)
STOCK BASED COMPENSATION (CONTINUED)
On November 12, 2014, the Company granted 700,000 options at an exercise price
of $0.045 in exchange for various professional and managerial services. The fair
value of these options was $38,723. The Company uses the Black-Scholes option
valuation model to value stock options. 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 remaining stock options are
as follows:
Risk free interest rate 1.65%
Expected dividend yield 0%
Expected stock price volatility 150%
Expected life of options 5 years
On February 10, 2016, the Company granted 850,000 options at an exercise price
of $0.025 in exchange for various professional and managerial services. The fair
value of these options was $22,034. The Company uses the Black-Scholes option
valuation model to value stock options. 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 remaining stock options are
as follows:
Risk free interest rate 1.16%
Expected dividend yield 0%
Expected stock price volatility 129%
Expected life of options 4.90 years
The following table summarizes the stock options outstanding at June 30, 2016:
Outstanding at
Issue Date Number Price Expiry Date June 30, 2016
---------- ------ ----- ----------- -------------
May 31, 2012 100,000 $0.045 May 31, 2017 100,000
March 15, 2013 200,000 $0.045 March 15, 2018 200,000
November 12, 2014 700,000 $0.045 November 12, 2019 700,000
February 10, 2016 650,000 $0.025 January 8, 2022 650,000
Total stock-based compensation for the periods ended June 30, 2016 and 2015 was
$22,034 and $0, respectively.
NOTE 6 - SUBSEQUENT EVENTS
The Company has analyzed its operations subsequent to June 30, 2016 through the
date these financial statements were issued, and has determined that it does not
have any material subsequent events to disclose.
13
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
FORWARD LOOKING STATEMENTS
This quarterly report contains forward-looking statements. These statements
relate to future events or our future financial performance. In some cases, you
can identify forward-looking statements by terminology such as "may", "should",
"expects", "plans", "anticipates", "believes", "estimates", "predicts",
"potential" or "continue" or the negative of these terms or other comparable
terminology. These statements are only predictions and involve known and unknown
risks, uncertainties and other factors that may cause our or our industry's
actual results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Although
we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Except as required by applicable law, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements to conform these statements to actual results.
Our unaudited financial statements are stated in United States Dollars (US$) 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 and our wholly-owned subsidiary Lithium Royalty Corp.,
a Nevada company, unless otherwise indicated.
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
Corporation regarding a business combination which could 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 effected 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 then
issued and outstanding shares increased from 4,470,000 shares of common stock to
268,200,000 shares of common stock.
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.
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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. Nevada Lithium's
corporate status was allowed to lapse and the company's status with the Nevada
Secretary of State has been revoked.
In April of 2016 our company established a wholly owned subsidiary called
Lithium Royalty Corp. The subsidiary is a Nevada Corporation and is the entity
in which we plan to build a portfolio of lithium mineral property royalties.
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, and Graphite properties in
British Columbia.
Our current operational focus is to monitor exploration progress of our partners
on our Fish Lake Valley and San Emidio projects, generate new exploration
properties focusing primarily on Nevada, and conduct exploration activities on
the those new prospects and on the BC Sugar property in British Columbia.
We are currently evaluating the opportunities that the Summa lands present (the
Hughes Claims), while also evaluating opportunities brought to our company by
third parties.
Effective April 23, 2014, we entered into an operating agreement with All
American Resources, L.L.C and TY & Sons Investments Inc. with respect to Summa,
LLC, a Nevada limited liability company incorporated on December 12, 2013,
wherein we hold a 25% membership. Our company's capital contribution to Summa,
LLC was $125,000, of which $100,000 was in cash and the balance in services. To
date we have contributed an additional $16,700 to Summa, LLC.
Effective August 15, 2014, we entered into an asset purchase agreement with
Pathion, Inc., a Delaware corporation, and Pathion Mining Inc., a Nevada
corporation. Pursuant to the Agreement, we agreed to sell to Pathion, Inc. and
Pathion Mining, our rights, interests and assets relating to our Fish Lake
Valley, San Emidio and BC Sugar properties. The asset purchase agreement was set
to close at the end of September 2014, but was extended to October 17, 2014 by
mutual agreement, and was further extended until January 19, 2015. After Pathion
failed to close the agreement within the agreed upon extended timeframe, we gave
notice on January 27, 2015 of the termination of the asset purchase agreement
entered into on August 15, 2014.
On February 20, 2015, our company signed a letter of intent with Kingsmere
Mining Ltd., which is the preliminary step whereby Kingsmere, or their
appointee, may choose to buy or option our company's lithium brine properties in
Nevada. The letter allowed for a due diligence and election period until April
1, 2015 with closing by April 15, 2015. The terms of the letter of intent with
Kingsmere were subsequently extended to May 31, 2015. Our company and Kingsmere
were not able to reach an agreement and a press release notifying the public was
issued on June 23, 2015.
On February 16, 2016, we issued a news release announcing that our company has
entered into a letter of intent with 1032701 B.C. Ltd. with respect to our Fish
Lake Valley lithium brine property in Esmeralda County, Nevada. On March 10,
2016 we issued a news release announcing the signing of the Fish Lake Valley
Earn-In Agreement. The terms of the Earn-In Agreement allow 1032701 to earn an
80% interest in Fish Lake Valley for payments over two years totaling $300,000
and issuance of 400,000 common shares of the publicly traded company anticipated
to result from a Going Public Transaction, and work performed on the property
over three years in the amount of $1,100,000. 1032701 then has a Subsequent
Earn-In option to purchase Lithium Corporation's remaining 20% working interest
within one year of earning the 80% by paying the Company a further $1,000,000,
at that point the Company would retain a 2.5% Net Smelter Royalty, half of which
may be purchased by 1032701 for an additional $1,000,000. Should the Purchaser
elect not to exercise the Subsequent Earn-In, a joint venture will be
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established. During the Joint Venture, should either party be diluted below a
10% working interest - their interest in the property will revert to a 7.5% Net
Smelter Royalty. The first tranche of cash and shares are to be issued within 60
days of the signing of the formal agreement. Menika Mining, a publicly traded
company on the TSX Venture Exchange trading under the symbol MML announced on
March 8, 2016 that it intended to acquire 1032701 B.C. Ltd and the right to
acquire the Fish Lake Valley Property. Menika Mining completed the acquisition
of 1032701 and fulfilled the initial obligations of the Fish Lake Valley
Earn-In-Agreement in April of 2016.
In April of 2016 our company established a wholly owned subsidiary called
Lithium Royalty Corp. The subsidiary is a Nevada Corporation and is the entity
in which we plan to build a portfolio of lithium mineral property royalties.
Also in April of 2016 Lithium Royalty Corp. gained 100% control of a lithium
property consisting of a block of mineral claims named the North Big Smokey
Property.
On May 11, 2016, we issued a news release announcing that effective May 3, 2016
our company has entered in to an Exploration Earn-In Agreement with 1067323 B.C.
Ltd. with respect to our San Emidio property. The terms of the formal agreement
are; payment of $100,000, issuance of 300,000 common shares of 1067323 B.C.
Ltd., or of the publicly traded company anticipated to result from a Going
Public Transaction, and work performed on the property by the Optionee in the
amount of $600,000 over the next three years to earn an 80% interest in the
property. 1067323 then has a subsequent Earn-In option to purchase Lithium
Corporation's remaining 20% working interest within three years of earning the
80% by paying our company a further $1,000,000, at that point our company would
retain a 2.5% Net Smelter Royalty, half of which may be purchased by 1067323 for
an additional $1,000,000. Should the Purchaser elect not to exercise the
Subsequent Earn-In, a joint venture will be established. The first tranche of
cash and shares are to be issued within 30 days of the signing of the formal
agreement.
On May 13, 2016 our wholly owned subsidiary sold 100% of the interest in the
North Big Smokey Property through a Property Acquisition Agreement with the
private company 1069934 Nevada Ltd. ("Purchaser"). Consideration paid to Lithium
Royalty Corp. consisted of $10,000.00, reimbursement of staking and filing fees,
300,000 shares in the "Purchaser Parent", 1069934 B.C. Ltd., Lithium Royalty
Corp. retained a 2.5% Net Smelter Royalty ("Vendor NSR")on the North Big Smokey
Property and the Purchaser has the right to purchase up to one-half (50%) of the
Vendor NSR for $1,000,000 to reduce the Vendor NSR to 1.25%.
Our company intends to continue generating additional lithium brine properties
in Nevada and conduct exploration on our BC Sugar flake graphite property in
British Columbia, while tracking progress at Fish Lake Valley and San Emidio and
also determining further plans of action with respect to our Mount Heimdal flake
graphite property in British Columbia. We will continue assessing our options
with respect to our 25% interest in Summa, LLC, a private Nevada company, which
holds the residue of the "Howard Hughes" Summa Corp., while generating new
prospects and evaluating property submittals for option or purchase.
FISH LAKE VALLEY PROPERTY
Fish Lake Valley is a lithium enriched playa (also known as a salar, or salt
pan), which is located in northern Esmeralda County in west central Nevada, and
the property is roughly centered at 417050E 4195350N (NAD 27 CONUS). We
currently hold forty, 80-acre Association Placer claims that cover approximately
3,200 acres (1280 hectares). 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, boron and potassium which could possibly
be amenable to extraction by evaporative methods. Our company allowed 56 claims
to lapse on September 1, 2012, which covered the southern playa area. These
claims were allowed to lapse as it was determined through the course of work
over the past three years that they are not overly prospective for hosting
lithium brine resources, nor is it strategically advantageous to continue to
hold them.
The property was originally held under mining lease purchase agreement dated
June 1, 2009, between Nevada Lithium Corporation, and Nevada Alaska Mining Co.
Inc., Robert Craig, Barbara Craig, and Elizabeth Dickman. Nevada Lithium issued
to the vendors $350,000 worth of common stock of our company in eight regular
disbursements. All disbursements were made of stock worth a total of $350,000,
and claim ownership was 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 Albemarle
has its Silver Peak lithium-brine operation. Access is excellent in Fish Lake
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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 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 outlined
a boron/lithium/potassium anomaly on the northern portions of the northern
playa, 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 (average 122.5 mg/L),
with boron ranging from 1,500 to 2,670 mg/L (average 2,219 mg/L), and potassium
from 5,400 to 8,400 mg/L (average 7,030 mg/L). Wet conditions on the playa
precluded drilling there in 2011, and for a good portion of 2012, however a
window of opportunity presented itself in late fall 2012. In November/December
2012 we conducted a short direct push drill program on the northern end of the
playa, wherein a total of 1,240.58 feet (378.09 meters) was drilled in 20 holes
at 17 discrete sites, and an area of 3,356 feet (1,023 meters) by 2,776 feet
(846 meters) was systematically explored by grid probing. The deepest hole was
81 feet (24.69 meters), and the shallowest hole that produced brine was 34 feet
(10.36 meters). The average depth of the holes drilled during the program was 62
feet (18.90 meters). The program successfully demonstrated that
lithium-boron-potassium-enriched brines exist to at least 62 feet (18.9 meters)
depth in sandy or silty aquifers that vary from approximately three to ten feet
(one to three meters) in thickness. Average lithium, boron and potassium
contents of all samples are 47.05 mg/L, 992.7 mg/L, and 0.535% respectively,
with lithium values ranging from 7.6 mg/L to 151.3 mg/L, boron ranging from 146
to 2,160.7 mg/L, and potassium ranging from 0.1 to 1.3%. The anomaly outlined by
the program is 1,476 by 2,461 feet (450 meters by 750 meters), and is not fully
delimited, as the area available for probing was restricted due to soft ground
conditions to the east and to the south. A 50 mg/L lithium cutoff is used to
define this anomaly and within this zone average lithium, boron and potassium
contents are 90.97 mg/L, 1,532.92 mg/L, and 0.88% respectively. On September 3,
2013, we announced that drilling had commenced at Fish Lake Valley. Due to
storms and wet conditions in the area which our company hoped to concentrate on,
the playa was not passable, and so the program concentrated on larger step-out
drilling well off the playa. This 11 hole, 1,025 foot program did prove that
mineralization does not extend much, if at all, past the margins of the playa,
as none of the fluids encountered in this program were particularly briny, and
returned values of less than 5 mg/L lithium.
Our company is very pleased with the results here, and believes that the playa
at Fish Lake Valley may be conducive to the formation of a "silver peak" style
lithium brine deposit. Our company reviewed the results in regards to the
overall geological interpretation of the lithium, boron and potassium bearing
strata. The results confirm the presence of targeted mineralization and further
evaluation programs will focus on determining the extent and depth of
mineralization. Our company is currently assessing options on how best to
further explore here.
We have signed an Exploration Earn-In Agreement with 1032701 B.C. LTD., a
private British Columbia company with respect to our Fish Lake Valley lithium
brine property.
1032701 BC Ltd., may acquire an initial 80% undivided interest in the Fish Lake
Valley property through the payment of an aggregate of US$300,000 in cash,
completing a Going Public Transaction on or before May 6, 2016, and subject to
the completion of the Going Public Transaction, arranging for the issuance of a
total of 400,000 common shares in the capital of the Resulting Issuer as
follows: (i) within five Business Days following the effective date,
* Pay $100,000 to our company and issue 200,000 common shares of the
TSX-V listed public company.
* On or before the first anniversary of the signing of the Definitive
Agreement pay $100,000 to our company and issue 100,000 common shares
of the Optionee/TSX-V listed public company.
* On or before the second anniversary of the signing of the definitive
agreement pay $100,000 to our company and issue 100,000 common shares
of the Optionee/TSX-V listed public company.
The Optionee must make qualified exploration or development expenditures on the
property of $200,000 before the first anniversary, an additional $300,000 before
the second anniversary, an additional $600,000 prior to the third anniversary,
and make all payments and perform all other acts to maintain the Property in
good standing before fully earning their 80% interest. Additionally, terms will
be negotiated for the Optionee to purchase our 20% interest in the property for
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$1,000,000, at which point the our interest would revert to a 2 1/2% Net Smelter
Royalty (NSR). The Optionee may then elect at any time to purchase one half of
our NSR for $1,000,000.
On April 7, 2106, 1032701 B.C. Ltd. was acquired by Menika Mining Ltd., which
subsequently changed its name to American Lithium Corp.(TSXV: LI) In connection
with the acquisition of 1032701 and in accordance with the Exploration Earn-In
Agreement, 200,000 common shares were issued to our company. In addition, we
received payment of $130,000.
SAN EMIDIO PROPERTY
The San Emidio property, located in Washoe County in northwestern Nevada, was
acquired through the staking of claims in September 2011. The twenty, 80-acre,
Association Placer claims currently held here cover an area of approximately
1,600 acres (640 hectares). Ten claims in the southern portions of the original
claim block that was staked in 2011 were allowed to lapse on September 1, 2012,
and a further ten claims were then staked and recorded. These new claims are
north of and contiguous to the surviving claims from our earlier block. 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.
Our company conducted near-surface brine sampling in the spring of 2011, and a
high resolution gravity geophysical survey in summer/fall 2011. Our company then
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 elongated 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.
Most recently we drilled this prospect in late October 2012, further testing the
area of the property in the vicinity where prior exploration by our company
discovered elevated lithium levels in subsurface brines. During the 2012 program
a total of 856 feet (260.89 meters) was drilled at 8 discrete sites. The deepest
hole was 160 feet (48.76 meters), and the shallowest hole that produced brine
was 90 feet (27.43 meters). The average depth of the seven hole program was 107
feet (32.61 meters). The program better defined a lithium-in-brine anomaly that
was discovered in early 2012. This anomaly is approximately 0.6 miles (370
meters) wide at its widest point by more than 2 miles (3 kilometers) long. The
peak value seen within the anomaly is 23.7 mg/l lithium, which is 10 to 20 times
background levels outside the anomaly. Our company believes that, much like Fish
Lake Valley, the playa at San Emidio may be conducive to the formation of a
"Silver Peak" style lithium brine deposit, and the recent drilling indicates
that the anomaly occurs at or near the intersection of several faults that may
have provided the structural setting necessary for the formation of a
lithium-in-brine deposit at depth.
We have signed an Exploration Earn-In Agreement with 1067323 B.C. Ltd. with
respect to our San Emidio property.
1067323 B.C. Ltd., may acquire an initial 80% undivided interest in the San
Emidio property through the payment of an aggregate of US$100,000 in cash,
completing a Going Public Transaction and subject to the completion of the Going
Public Transaction, arranging for the issuance of a total of 300,000 common
shares in the capital of the Resulting Issuer as follows:
* Within 30 days of the Effective Date pay $100,000 to our company and
issue 100,000 common shares of the TSX-V listed public company.
* On or before the first anniversary of the signing of the Definitive
Agreement issue 100,000 common shares of the Optionee/TSX-V listed
public company.
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* On or before the second anniversary of the signing of the definitive
agreement issue 100,000 common shares of the Optionee/TSX-V listed
public company.
The Optionee must make qualified exploration or development expenditures on the
property of $100,000 before the first anniversary, an additional $200,000 before
the second anniversary, an additional $300,000 prior to the third anniversary,
and make all payments and perform all other acts to maintain the Property in
good standing before fully earning their 80% interest. Additionally, Optionee
has the right to purchase our 20% interest in the property for $1,000,000, at
which point the our interest would revert to a 2 1/2% Net Smelter Royalty (NSR).
The Optionee may then elect at any time to purchase one half of our NSR for
$1,000,000.
On May 24, 2016, 1067323 B.C. Ltd. was acquired by American Lithium Corp.(TSXV:
LI) In connection with the acquisition of 1067323 and in accordance with the
Exploration Earn-In Agreement, 100,000 common shares were issued to our company.
In addition, we received payment of $100,000.
MOUNT HEIMDAL FLAKE GRAPHITE PROPERTY
On April 15, 2013, we entered into a mining option agreement with, Tom Lewis, a
director and former officer of our company, wherein we had the option to acquire
a 100% interest in the Mount Heimdal Flake Graphite property in the Slocan
Mining Division of British Columbia, Canada.
The Mount Heimdal property is comprised of three mineral claims, which encompass
2,582 acres (1,045 hectares) of highly metamorphosed rock. The property is
roughly six miles (10 kms) south of Eagle Graphite's Black Crystal quarry, and
is located within the same package of gneisses, graphite mineralized marbles,
and calc-silicate gneisses. Data from BC Geological Survey assessment reports
indicate that mineralization grading up to 4.8% graphitic carbon may be located
on the property.
High purity graphite is presently the most widely used anode material for
lithium ion battery technology, and typically greater than 10 times more
graphite is used in comparison to lithium in lithium ion battery production. In
addition to increased graphite consumption due to growth in lithium ion
batteries sales, carbon fiber composites are increasingly being utilized in
auto, and aircraft construction. Also, presently there is considerable research
into graphene, a flake graphite product, and it is possible a myriad of new
applications or discoveries will ensue as a direct result of this work.
Pursuant to the terms of the original agreement, we were required to spend
$15,000 in exploration on the property and complete an assessment report by
November 30, 2013, and upon successful completion of the program and the report,
our company was to earn a 100% interest in the claims, subject to a 1.5% net
overriding royalty to the vendor from the proceeds of production.
Prospecting work was performed on the Mount Heimdal property in June/July 2013
and several mineralized zones were noted here, the best of which graded 3.72%
flake graphite. Although the work was encouraging it was decided that our
company would be best served presently by focusing on the BC Sugar property. Our
company negotiated an agreement with Tom Lewis, a director and former officer of
our company, with Tom Lewis as the vendor of Mount Heimdal, whereby Mr. Lewis
assigned his 100% interest in the property for a 2% net smelter royalty on any
proceeds from future production from the property. In addition Mr. Lewis holds
title to both the Mount Heimdal, and BC Sugar properties, in trust, for our
company and will transfer all interest at such time as our company creates a
subsidiary that is eligible to hold title in mineral properties in British
Columbia.
In August 2014, an exploration crew was mobilized to explore the Mount Heimdal
flake graphite property. The program focused on flake graphite mineralization
discovered on the property during the brief program undertaken in 2013, while
exploring other areas of the property that were felt to also be prospective for
hosting flake graphite mineralization. No further significant mineralization was
found, and our company is considering options for this property moving forward.
BC SUGAR FLAKE GRAPHITE PROPERTY
On June 6, 2013, we entered into a mining claim sale agreement with Herb Hyder
wherein Mr. Hyder agreed to sell to our company a 50.829 acre (20.57 hectare)
claim located in the Cherryville area of British Columbia. As consideration for
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the purchase of the property, we issued 250,000 shares of our company's common
stock to Mr. Hyder. In addition to the acquired claim, our company staked or
acquired another 13 claims at various times over the subsequent months, to bring
the total area held under tenure to approximately 19,816 acres (8,020 hectares).
The flake graphite mineralization of interest here is hosted predominately in
graphitic quartz/biotite, and lesser graphitic calc-silicate gneisses. The rocks
in the general area of the BC Sugar prospect are similar to the host rocks in
the area of the crystal graphite deposit 55 miles (90 kms) to the southeast, in
the vicinity of our company's Mount Heimdal block of claims.
The BC Sugar property is well placed in the Shushwap Metamorphic Complex, in a
geological environment favorable for the formation of flake graphite deposits,
and is in an area of excellent logistics, with a considerable network of logging
roads within the project area. Additionally the town of Lumby is approximately
19 miles (30 kms) to the south of the property, while the City of Vernon is only
30 miles (50 kms) to the southwest of the western portions of the claim block.
We received final assays from the October 2013 prospecting and geological
program at the BC Sugar property in December of 2013. That work increased the
area known to be underlain by graphitic bearing gneisses, and further
evaluations were made in the area of the Sugar Lake, Weather Station, and Taylor
Creek showings. In the general vicinity of the Weather Station showing, a
further 13 samples were taken, and hand trenching was performed at one of
several outcrops in the area. In the trench a 5.2 meter interval returned an
average of 3.14% graphitic carbon, all in an oxidized relatively friable
gneissic host rock. Additionally a hydrothermal or vein type mineralized
graphitic quartz boulder was discovered in the area which graded up to 4.19%
graphitic carbon. The source of this boulder was not discovered during this
program, but it is felt to be close to its point of origin. Samples
representative of the mineralization encountered here were taken for
petrographic study, which was received in late 2013. A brief assessment work
program was performed in September 2014 to ensure all claims in the package were
in good standing prior to the anticipated sale of this asset to Pathion.
Recommendations were made by the consulting geologist who wrote the assessment
report with respect to trenching, and eventually drilling the Weather Station
showing. Our company submitted a Notice of Work to the BC Government in early
May 2015 to enable our company to conduct a program of excavator trenching,
sampling and geological mapping on the Weather Station showing. In May of 2015
we signed an agreement with KLM Geosciences LLC of Las Vegas to conduct a short
Ground Penetrating Radar (GPR) survey on the property in the Weather Station -
Taylor Creek areas. The GPR survey as well as a GEM-2 electromagnetic (EM)
survey took place in approximately mid-May 2015. The GPR survey did not provide
useful data because of the moisture saturation in the shallow subsurface. The EM
survey successfully generated an anomaly over known mineralization as well as
extended the anomaly to the west under an area of cover consisting of
glacial/fluvial till. Lithium Corporation is pleased with the results of the EM
survey and is considering modifying our work plans to include additional work
that builds on the results of this survey. In August of 2015 our Notice of Work
for trenching was approved by the BC Government and in October we commenced
work. A trench of 265.76 feet (81 meters) was excavated and graphitic gneiss was
mapped and sampled. The company is currently waiting for the assay results of
the sampling to confirm the grade and length of the graphite mineralization
intersected. Our company judges these results as a technical success and at this
time further exploration is justified. We plan to use the results of the trench
sampling to plan the future work plans.
THE HUGHES CLAIMS
Effective April 23, 2014, we entered into an operating agreement with All
American Resources, L.L.C and TY & Sons Investments Inc. with respect to Summa,
LLC, a Nevada limited liability company incorporated on December 12, 2013,
wherein we hold a 25% membership in a number of patented mining claims that
spring from the once vast holdings of Howard Hughes. Our company's capital
contribution paid to Summa, LLC was $125,000, of which $100,000 was in cash and
the balance in services.
Our company participated in the formation of Summa, which holds 88 fee-title
patented lode claims, which cover approximately 1,191.3 acres of prospective
mineral lands. Our company has recently signed a joint operating agreement with
the other participants to govern the conduct of Summa, and the development of
the lands. Our company's director, Tom Lewis, has been named as a managing
member of Summa.
The Hughes lands are situated in six discrete prospect areas in Nevada, the most
notable of which being the Tonopah block in Nye County where Summa holds 56
claims that cover approximately 770 acres in the heart of the historic mining
camp where over 1.8 million ounces of gold and 174 million ounces of silver were
produced predominately in the early 1900's. The Hughes claims include a number
of the prolific past producers in Tonopah, such as the Belmont, the Desert
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Queen, and the Midway mines. In addition there are also claims in the area of
the past producing Klondyke East mining district, which is to the south of
Tonopah, and at the town of Belmont (not to be confused with the Belmont claim
in Tonopah), Nevada, another notable silver producer from the 1800's, which is
roughly 40 miles to the northeast of Tonopah.
Recently research has been conducted on the Hughes properties, focusing on the
Tonopah area where reporting in the 1980's, indicate that over 2.175 million
tons of mine dumps and mill tailings exist at surface on Summa's properties that
contain in the order of 3.453 million ounces of silver, and 28,500 ounces of
gold. In addition to this easily extractable surficial resource, other reports
indicate that 300 - 500,000 tons of mineralized material is expected to remain
at depth in old workings on Summa's properties, which is believed to contain an
average 20 ounces silver and 0.02 ounces gold per ton. Also several partially
tested exploration targets have been identified on Summa's Tonopah claims, where
further work could potentially lead to a marked increase in known underground
resources.
In the general area of our company's newest acquisition, West Kirkland Mining
has recently announced that it has completed a $29.2 million dollar financing,
the proceeds of which were used to purchase a 75% interest in Allied Nevada Gold
Corporation's Tonopah properties. West Kirkland also has the option to purchase
the remaining 25% interest by paying Allied Nevada a further $10 million dollars
on or before October 23, 2016. West Kirkland has recently compiled an updated
NI-43-101 resource on the Hasbrouck and Three Hills prospects which are roughly
5.5 and 2 miles, respectively, from Summa's Tonopah claim block and it is West
Kirkland's intent to advance these properties to a pre-feasibility study and
initiate mine permitting. The Nye County Recorder's office only recently
recorded title in favor of Summa LLC., so we are only now beginning to determine
how best to capitalize on this asset.
We are currently pursuing other properties which are believed to be prospective
for hosting lithium or graphite mineralization, as well as evaluating
opportunities brought to our company by third parties.
Additionally our company is looking to ramp up its generative program exploring
for new deposits of next generation battery related materials.
RESULTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 2016 COMPARED TO THE THREE MONTHS ENDED JUNE 30,
2015
We had a net loss of $52,134 for the three month period ended June 30, 2016,
which was $6,094 less than the net loss of $58,228 for the three month period
ended June 30, 2015. The change in our results over the two periods is primarily
the result of decreases in professional fees, exploration expenses and investor
relations expense.
The following table summarizes key items of comparison and their related
increase (decrease) for the three month periods ended June 30, 2016 and 2015:
Change Between
Three Month
Period Ended
Three Months Three Months June 30, 2016
Ended Ended and
June 30, June 30, June 30,
2016 2015 2015
-------- -------- --------
Professional fees $ 9,750 $ 6,747 $ 3,003
Exploration expenses 15,673 10,922 4,751
Consulting fees 11,304 21,300 (9,996)
Insurance expense 5,633 4,266 1,367
Investor relations 3,121 2,685 436
Transfer agent and filing fees 2,607 3,705 (1,098)
Travel 663 6,094 (5,431)
General and administrative 3,383 2,623 760
Interest/Other income 0 (114) 114
-------- -------- --------
Net loss $(52,134) $(58,228) $ (6,094)
======== ======== ========
21
SIX MONTHS ENDED JUNE 30, 2016 COMPARED TO THE SIX MONTHS ENDED JUNE 30, 2015
We had a net loss of $140,021 for the six month period ended June 30, 2016,
which was $9,690 more than the net loss of $130,331 for the six month period
ended June 30, 2015. The change in our results over the two periods is primarily
the result of decreased spending while pursuing financing and/or joint venture
deals to explore our properties.
The following table summarizes key items of comparison and their related
increase (decrease) for the six month periods ended June 30, 2016 and 2015:
Change Between
Six Month
Period Ended
Six Months Six Months June 30, 2016
Ended Ended and
June 30, June 30, June 30,
2016 2015 2015
---------- ---------- ----------
Professional fees $ 22,190 $ 19,364 $ 2,826
Exploration expenses 32,693 27,794 4,899
Consulting fees 29,304 46,200 (16,896)
Insurance expense 9,858 8,638 1,220
Investor relations 10,404 6,060 4,344
Stock based compensation 22,034 0 22,034
Transfer agent and filing fees 5,213 5,980 (767)
Travel 3,448 10,554 (7,106)
General and administrative 4,897 5,855 (958)
Interest/Other income (20) (114) (94)
---------- ---------- ----------
Net loss $ (140,021) $ (130,331) $ 9,690
========== ========== ==========
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 June 30, 2016 reflects current assets of $665,819. We
had cash in the amount of $356,894 and working capital in the amount of $161,057
as of June 30, 2016. 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
June 30, December 31,
2016 2015
---------- ----------
Current assets $ 665,819 $ 235,744
Current liabilities 504,762 7,500
---------- ----------
Working capital $ 161,057 $ 228,244
========== ==========
We anticipate generating losses and, therefore, may be unable to continue
operations further in the future.
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CASH FLOWS
Six Months Ended
June 30,
2016 2015
---------- ----------
Net cash (used in) operating activities $ (115,371) $ (139,039)
Net cash (used in) investing activities (11,700) --
Net cash provided by (used in) financing activities 292,500 --
---------- ----------
Net (decrease) in cash during period $ 165,429 $ (139,039)
========== ==========
OPERATING ACTIVITIES
Net cash used in operating activities during the six months ended June 30, 2016
was $115,371, a decrease of $23,669 from the $139,039 net cash outflow during
the six months ended June 30, 2015.
INVESTING ACTIVITIES
Cash used in investing activities during the six months ended June 30, 2016 was
$11,700, which was a $11,700 increase from the $Nil cash used in investing
activities during the six months ended June 30, 2015.
FINANCING ACTIVITIES
Cash from financing activities during the six months ended June 30, 2016 was
$292,500 as compared to $Nil in cash provided by financing activities during the
six months ended June 30, 2015.
We estimate that 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 and administrative expenses $190,000
Exploration expenses 200,000
Travel 30,000
--------
TOTAL $420,000
========
To date we have relied on proceeds from the sale of our shares and on loans from
our sole officer in order to sustain our basic, minimum operating expenses;
however, we cannot guarantee that we will secure any further sales of our shares
or that our sole officer and director with provide us with any future loans. We
estimate that the cost of maintaining basic corporate operations (which includes
the cost of satisfying our public reporting obligations) will be approximately
$2,000 per month. Due to our current cash position of approximately $165,429 as
of June 30, 2016, we estimate that we have sufficient cash to sustain our basic
operations for the next twelve months.
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.
23
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.
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
Our company uses the accrual basis of accounting and accounting principles
generally accepted in the United States of America ("GAAP" accounting). Our
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 we are not exposed to any significant credit
risk on cash and cash equivalents.
USE OF ESTIMATES
The preparation of 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 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 has yet to realize revenues from operations. Once our company has
commenced operations, we 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.
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.
24
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, deposits, 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 $0 and $0 was recorded during the periods ended June 30, 2016 and
2015, respectively.
RECENT ACCOUNTING PRONOUNCEMENTS
In January 2016, the Financial Accounting Standards Board ("FASB"), issued
Accounting Standards Update ("ASU") 2016-01, "Financial Instruments-Overall
(Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial
Liabilities," which amends the guidance in U.S. generally accepted accounting
principles on the classification and measurement of financial instruments.
Changes to the current guidance primarily affect the accounting for equity
investments, financial liabilities under the fair value option, and the
presentation and disclosure requirements for financial instruments. In addition,
the ASU clarifies guidance related to the valuation allowance assessment when
recognizing deferred tax assets resulting from unrealized losses on
available-for-sale debt securities. The new standard is effective for fiscal
years and interim periods beginning after December 15, 2017, and are to be
adopted by means of a cumulative-effect adjustment to the balance sheet at the
beginning of the first reporting period in which the guidance is effective.
Early adoption is not permitted except for the provision to record fair value
changes for financial liabilities under the fair value option resulting from
instrument-specific credit risk in other comprehensive income. Our company is
currently evaluating the impact of adopting this standard.
In November 2015, the FASB issued ASU 2015-17, "Income Taxes (Topic 740):
Balance Sheet Classification of Deferred Taxes," which simplifies the
presentation of deferred income taxes by requiring that deferred tax liabilities
and assets be classified as noncurrent in a classified statement of financial
position. This ASU is effective for financial statements issued for annual
periods beginning after December 16, 2016, and interim periods within those
annual periods. The adoption of this standard will not have any impact on our
company's financial position, results of operations and disclosures.
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
25
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
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
From time to time, we may become involved in litigation relating to claims
arising out of its operations in the normal course of business. We are not
involved in any pending legal proceeding or litigation and, to the best of our
knowledge, no governmental authority is contemplating any proceeding to which we
area party or to which any of our properties is subject, which would reasonably
be likely to have a material adverse effect on us, except for the following:
In December, 2015 two cases were filed against our company; the first was filed
in the United States District Court, District of Nevada by Jablonski
Enterprises, Ltd. against several defendants, including our company, Summa, LLC,
Henry Tonking, GIS Land Services, Greg Ekins, the Nye County Assessor, the
Mapping Administrator for Nye County, the Nye County District Attorney and the
Nye County Deputy District Attorney with respect to Summa, LLC's efforts to
change the record name on the assessor's tax roles from Jablonski Enterprises to
Summa, LLC pursuant to a prior court order issued by the Clark County Distrrict
Court. The second identical case was filed in the 5th Judicial District Court of
Nevada against the same defendants, including our company, and is regarding the
same issues.
On May 3, 2016, the case in the 5th Judicial District Court of Nevada was
dismissed against the appearing defendants with prejudice, and those defendants,
including our company, were awarded legal fees and costs to be paid by the
plaintiff and the case is currently pending an order from the Court. The Federal
case filed in the United States District Court, District of Nevada is currently
pending a motion to dismiss and we expect a similar outcome as the State case in
the 5th Judicial District Court of Nevada. Our company believes that the
remaining case in U.S. Federal Court is baseless, without merit and is purely a
nuisance lawsuit.
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.
26
ITEM 6. EXHIBITS
Exhibit
Number 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)
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 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 Mining Option Agreement dated April 15, 2013 between our company and
Thomas Lewis (incorporated by reference to our Current Report on Form
8-K filed on April 22, 2013)
10.4 Mining Claim Sale Agreement dated June 6, 2013 between our company and
Herb Hyder (incorporated by reference to our Current Report on Form 8-K
filed on June 12, 2013)
10.5 Trust Agreement dated August 30, 2013 between our company and Tom Lewis
(incorporated by reference to our Quarterly Report on Form 10-Q filed
on November 7, 2013)
10.6 Operating Agreement dated effective April 23, 2014 between our company,
All American Resources, L.L.C. and TY & Sons Investments Inc.
(incorporated by reference to our Current Report on Form 8-K filed on
April 29, 2014)
10.7 Asset Purchase Agreement dated August 15, 2014 between our company and
Pathion, Inc. (incorporated by reference to our Quarterly Report on
Form 10-Q filed on November 7, 2014)
10.8 Exploration Earn-In Agreement dated effective February 10, 2016 between
our company and 1032701 B.C. Ltd. (incorporated by reference to our
Current Report on Form 8-K filed on March 15, 2016)
10.9 Exploration Earn-In Agreement dated effective February 10, 2016 between
our company, 1067323 Nevada Ltd. and 1067323 B.C. Ltd. (incorporated by
reference to our Current Report on Form 8-K filed on May 11, 2016)
(14) CODE OF ETHICS
14.1 Code of Business Conduct and Ethics (incorporated by reference to our
Annual Report on Form 10-K filed on April 15, 2013)
(21) SUBSIDIARIES OF THE REGISTRANT
21.1 Lithium Royalty Corp, a Nevada corporation
27
(31) RULE 13A-14 (D)/15D-14D) CERTIFICATIONS
31.1* Section 302 Certification by the Principal Executive Officer, Principal
Financial Officer and Principal Accounting Officer
(32) SECTION 1350 CERTIFICATIONS
32.1* Section 906 Certification by the Principal Executive Officer, Principal
Financial Officer and Principal Accounting 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.
28
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: August 15, 2016 /s/ Brian Goss
---------------------------------------
Brian Goss
President, Treasurer, Secretary and
Director (Principal Executive Officer,
Principal Financial Officer and
Principal Accounting Officer)
29