Get Started for Free Contexxia identifies hard-to-find pieces of information in SEC filings. No more highlighters, no more redlining, no more poring over huge documents. Ocean Thermal Energy Corp (827099) 10-Q published on May 13, 2021 at 2:58 pm
Reporting Period: Mar 30, 2021
The accompanying unaudited condensed consolidated financial statements have been prepared on the assumption that we will continue as a going concern. As reflected in the accompanying condensed consolidated financial statements, we had a net loss of $1,433,098 and used $116,364 of cash in operating activities for the three months ended March 31, 2021. We had a working capital deficiency of $29,236,540 and a stockholders’ deficiency of $29,414,386 as of March 31, 2021. These factors raise substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent on our ability to increase sales and obtain external funding for our projects under development. The Biden administration has announced a range of financial support for renewable and sustainable companies. Details from the administration are not available yet, but we are already in the process of filing for financial support. Additional applications for financial support will be made as appropriate. The financial statements do not include any adjustments that may result from the outcome of this uncertainty.
Notes were issued between 11/2/2020 and 3/18/21. The notes bear an interest rate of 10%. Repayment will be made as follows: (i) the principal and interest within five business days following our receipt of $25.5 million from the Phase One Litigation; and (ii) the additional payment within five business days following our actual receipt of any funds from the Phase Two Litigation, less legal fees accrued up to that date. If any such funds are actually received on more than one date, payment will be made as such funds are actually received by us and after deductions of accrued legal fees up to that date.
On March 31, 2021, we issued 1,693,877 shares of common stock to Oasis Capital, LLC for $83,000. This was a settlement of a second commitment for a convertible promissory note dated May 22, 2018. The initial commitment was 400,000 shares of common stock issued on May 22, 2018.
Financing activities provided cash of $186,145 for our operations during the three months ended March 31, 2021, as compared to $244,837 for the three months ended March 31, 2020, a decrease of 24.0%. During three months ended March 31, 2021, we received $190,000 from convertible notes and notes payable as compared to $260,000 in the same period of 2020.
Our condensed consolidated financial statements have been prepared assuming we will continue as a going concern. We have experienced recurring losses from operations and have an accumulated deficit. Our ability to continue our operations as a going concern is dependent on the success of management’s plans, which include the raising of capital through debt and/or equity markets until such time that revenue provided by operations is sufficient to fund working capital requirements. We will require additional funding to finance the growth of our current and expected future operations as well as to achieve our strategic objectives. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should we be unable to continue as a going concern. The Biden administration has announced a range of financial support for renewable and sustainable companies. Details from the administration are not available yet, but we are already in the process of filing for financial support. Additional applications for financial support will be made as appropriate.