i also heard that the money is coming...........imminently.

??????????????????????

lmao, way to go dannol48. please stick around for awhile. we need you to keep us informed. ty and glta.

e-trade is still not trading ipwg.........

IMMINENTLY!!!!!!!!!!!!!!!

thanks, im stuck also. glta.

does anyone know what this means to mdin? thank you in advance. glta.

mdin is on this list. im also in ipwg which is on the list also, lucky me. [lol]

IPWG dtcc-eligible-securities-execution-discontinued http://bit.ly/DTCC86

glta.

o.k., let me ask it this way - does anyone know what this means to cxac? thank you in advance. glta.

cxac was not on the list, ?. im not sure what it means, but im also invested in ipwg, which is on the list.

IPWG dtcc-eligible-securities-execution-discontinued http://bit.ly/DTCC86

cxac was not on the list, ?. im not sure what it means, but im also invested in ipwg, which is on the list.

IPWG dtcc-eligible-securities-execution-discontinued http://bit.ly/DTCC86

its been 5 weeks since first delivery of loaded carbon, i wonder whats gong on with that........................


Form 10-Q/A for GRYPHON GOLD CORP

21-Nov-2011

Quarterly Report


Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.

Forward-Looking Statements

This quarterly report on Form 10-Q and the exhibits attached hereto contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements concern our anticipated results and developments in our operations in future periods, planned exploration and development of our properties, plans related to its business and other matters that may occur in the future. These statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects" or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "estimates" or "intends", or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements.

With respect to forward-looking statements and information contained in this quarterly report, we have made assumptions regarding, among other things:

? the future price of gold;
? estimates related to future costs of production, establishing mining operations, capital requirements, operating and exploration expenditures;
? continued government regulation of mining operations in accordance with past regulatory practices;
? our ability to phase-in production at the Borealis Property to reach full production within expected timeframes; and
? our ability to raise any additional capital required to fund our exploration, development and working capital requirements.

Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those expressed or implied by the forward-looking statements, including, without limitation:

? the timing and possible outcome of pending regulatory and permitting matters;
? the timing and outcome of our feasibility study;
? the parameters and design of any potential mining facilities on the Borealis Property;
? future financial or operating performances of Gryphon Gold, its subsidiaries, and its projects;
? the estimation of mineralization and the realization of mineral reserves, if any, based on mineralization estimates;
? the timing of exploration, development, and production activities and estimated future production, if any;
? estimates related to costs of production, capital, operating and exploration expenditures;
? requirements for additional capital and our ability to raise additional capital;
? government regulation of mining operations, environmental risks, reclamation and rehabilitation expenses;
? title disputes or claims;
? operational risks related to mining hazards, worker safety, employee matters and labor;
? limitations of insurance coverage; and
? the future price of gold, silver, or other minerals.

This list is not exhaustive of the factors that may affect our forward-looking statements. Some of the important risks and uncertainties that could affect forward-looking statements are described further under the sections titled "Risk Factors and Uncertainties", "Description of the Business" and "Management's Discussion and Analysis" of our annual report on Form 10-K as filed with the SEC on June 30, 2011. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, believed, estimated or expected. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events, except as required by law.

We qualify all the forward-looking statements contained in this quarterly report by the foregoing cautionary statement.

Cautionary Note Regarding Management's Discussion and Analysis

This discussion and analysis should be read in conjunction with the accompanying interim consolidated financial statements and related notes. The discussion and analysis of the financial condition and results of operations are based upon the interim consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of any contingent liabilities at the financial statement date and reported amounts of revenue and expenses during the reporting period. On an on-going basis, we review our estimates and assumptions. The estimates were based on historical experience and other assumptions that we believe to be reasonable under the circumstances. Actual results are likely to differ from those estimates under different assumptions or conditions, but we do not believe such differences will materially affect our financial position or results of operations. Critical accounting policies, the policies we believe are most important to the presentation of our financial statements and require the most difficult, subjective and complex judgments, are outlined below in "Critical Accounting Policies," and have not changed significantly.

Cautionary Note to U.S. Investors Regarding Mineral Reserve and Resource Estimates

Certain of the technical reports, the preliminary assessment and the pre-feasibility study referenced in this quarterly report use the terms "mineral resource," "measured mineral resource," "indicated mineral resource" and "inferred mineral resource". We advise investors that these terms are defined in and required to be disclosed by NI 43-101; however, these terms are not defined terms under the SEC's Industry Guide 7 ("Guide 7") and are normally not permitted to be used in reports and registration statements filed with the SEC. As a reporting issuer in Canada, we are required to prepare reports on our mineral properties in accordance with NI 43-101. We reference those reports in this annual report for informational purposes only. Investors are cautioned not to assume that any part or all of mineral deposits in the above categories will ever be converted into Guide 7 compliant reserves. "Inferred mineral resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Disclosure of "contained pounds" in a resource is permitted disclosure under Canadian regulations; however, the SEC normally only permits issuers to report mineralization that does not constitute "reserves" by SEC standards as in place tonnage and grade without reference to unit measures.

Overview

Business Objectives

Gryphon Gold is in the business of acquiring, exploring, and developing gold properties in the United States, emphasizing the State of Nevada. Our objective is to increase value of our shares through the exploration, development and extraction of gold from deposits, beginning with our Borealis property, located in Nevada's Walker Lane Gold Belt (the "Borealis Property"). The development and extraction may be performed by us or by potential partners. We will also consider the acquisition and exploration of other potential gold bearing properties within Nevada or areas that have a similar political risk profile.

The business plan for the Borealis Property is to develop, operate and efficiently produce gold and silver from indentified leachable oxide reserves and to further expand and develop the significant sulphide resource through exploration, metallurgical design and project permitting and development. The successful development of the Borealis Oxide Heap Leach Project is anticipated to provide the revenue that would allow for the further development of the Borealis Property. The Borealis Property consists of unpatented mining claims of approximately 20 acres each, totaling about 15,020 acres, from which there was production in the past. The Borealis Property is a property that we believe has excellent potential exploration targets as defined by past exploration success, geophysical targets and past successful mining.

On April 25, 2011, we released an updated pre-feasibility study entitled "NI 43-101 Pre-Feasibility Study Update of the Mineral Resources of the Borealis Gold Project Located in Mineral County, Nevada, USA" dated April 25, 2011, (the "Pre-Feasibility Study"), which was furnished to the SEC as Exhibit 99.1 to our Form 8-K filed on April 26, 2011 and filed pursuant to Canadian securities laws and available on www.sedar.com. The Pre-Feasibility Study provided updated capital and operating cost estimates for a scaled down version of the mine start-up.

The Company raised capital for Phase 1 activities to construct the mine and processing plant and begin gold recovery; however, additional financing will be required to complete the ADR and fund operations until cash from sales of gold begins to flow to the Company. Management is conducting negotiations with multiple parties to obtain the needed financing.

The plan contemplates the completion of construction of a new leach pad and ponds. Phase 1 also anticipates the startup of heap leach operations to extract gold from partially leached heaps already identified on the Borealis Property. We anticipate that this processing will generate positive operating cash flow necessary to expand operations to achieve our objective of producing in excess of 42,000 ounces per year gold equivalent as provided in the Pre-Feasibility Study design.

Phase 1 of our plan was projected to cost approximately $12.7 million and to provide cash flows necessary to fund Phase 2. As at September 30, 2011, we had accumulated approximately $11.7 million for Phase 1, corporate costs and production costs. Subsequent to the reporting period we have accumulated costs exceeding the $12.7 million as we have moved into production and have not yet received revenues from loaded carbon sales. Phase 2 is anticipated to expand the leach pad; mobilize the crushing and mining equipment; construct the permanent gold recovery plant and begin mining in the Borealis Property's Borealis open pit. We expect the gross profits and positive cash flow from Phase 2 to provide the capital required to expand the mine to full production. The main activities associated with full production are:

? development of roads and infrastructure, and
? pre-stripping and development of the remaining oxide reserves
? Efficient mining and processing of 2 million tons of ore per year
? Processing of pregnant solutions from heap leach operations to produce gold and silver dor?

The expected cash flow generated in Phase 1 and Phase 2 is anticipated to provide the resources needed to continue the exploration required to expand the oxide resources for extending the mine life.

The mine life is estimated at 6 years with additional gold recovery in year seven with heap wash down. Expansion of the mine life past the initial 6-year estimate is dependent on the expansion of current mineralization or the discovery of additional mineralization through additional drilling on the property.

As anticipated in our plan under the Pre-Feasibility Study, groundbreaking occurred for the construction of the Borealis heap leach mine on June 6, 2011. Deliveries of loaded carbon to Just Refiners, Inc. of Reno, NV began on October 13, 2011. Full production is anticipated in March 2012.

A successful Borealis Oxide Heap Leach Project is expected to provide the cash required to fulfill the long-term plan to further explore the Borealis Property with the objective of expanding its current known mineralization.

The plan for the Borealis Property is based on the Plan of Operations approved by the U.S. Forest Service. The Plan of Operations does not present an economic analysis, and we have not placed any information in the Plan of Operations regarding capital expenditures, operating costs, ore grade, anticipated revenues, or projected cash flows. The Plan of Operations was based on the general economic concepts as presented in the Pre-Feasibility Study.

Borealis Property

During the quarter ended September 30, 2011, we completed construction of new leach pads, ponds, carbon columns, roads and infrastructure. Direct costs of materials, labor, equipment and supplies used in construction activities are capitalized during the period incurred. Additionally, certain indirect costs are capitalized in the period of allocation. Interest expense during the construction period is allocated and capitalized in the period it is accrued. Loading of the leach pads began in early September and the leaching process began on September 26, 2011.

For a complete history of our Borealis Property, please see our 10-K for the fiscal year ended March 31, 2011 filed with the SEC on June 30, 2011.

Administration and Capital Resource Activities

On May 18, 2011, we closed a public offering of 80,000,000 shares of our common stock at a price of $0.125 per share for aggregate gross proceeds of $10,000,000. As part of the offering, the underwriters were granted an over-allotment option to cover over-allotments. One underwriter exercised its over-allotment option in full for an additional 6,000,000 shares of our common stock at $0.125 per share for additional gross proceeds of $750,000. On May 24, 2011, the second underwriter exercised its over-allotment option in part for an additional 3,060,000 shares of our common stock at a price of $0.125 per share for additional gross proceeds of $382,500. After fulfilling the over-allotment options, we issued 89,060,000 shares and received $9.6 million in net proceeds.

On July 27, 2011, we closed a $3,169,514 debt offering (the "Offering") of units ("Units") at a price of $1,000 CAD per Unit. The Offering was led by Acumen Capital Finance Partners Limited in Canada and by Roth Capital Partners in the United States. Each Unit consists of $1,000 CAD principal amount of 10% secured subordinated debentures maturing July 28, 2012 (the "Debentures") and 1,500 warrants (the "Warrants"). Each Warrant entitles the holder thereof to purchase one common share in the capital of the Company at a price of $0.20 USD per share. The Warrants expire on January 27, 2013.

The Debentures bear interest from the date of issue at 10.0% per annum, payable quarterly on March 31, June 30, September 30 and December 31 of each year, commencing on September 30, 2011. The Debentures will mature 12 months from the closing date of the Offering. Acumen and Roth Capital were paid a cash commission of 6% of the gross proceeds of the offering and received 112,500 warrants each exercisable at a price of $0.20 USD per share. The Warrants expire on January 27, 2013.

Fiscal 2012 Plan of Operations

Our long-term plan is to focus on the Borealis Property production through the Borealis Oxide Heap Leach Project. To further advance the Borealis Property, we expect to continue exploration in the pediment areas of the Borealis Property.

We intend to continue to take all steps necessary to preserve our rights to the Borealis Property under the existing terms of the property lease. We also expect to work with the United States Forest Service with the objectives of maintaining our permits under the Plan of Operations.

We currently plan to accomplish the following activities for the duration of fiscal 2012, which ends March 31, 2012:

? Execute a drill program to further delineate and expand the oxide resource within the permitted footprint of the Borealis Property; and

? Complete construction of the Adsorption, Desorption and Recovery Plant (ADR) and commence the production of dore';

? Begin construction of Phase 1B elements, primarily the leach pad expansion.

Results of Operations

As of September 30, 2011 we are completing construction of the Borealis Oxide Heap Leach Project and had no producing mineral properties. Thus, we had no sales revenue during all reporting periods.

Three months ended September 30, 2011 compared to three months ended September 30, 2010

For the three months ended September 30, 2011, we had a net loss of $804,461 or nil per share from continuing operations compared to a net loss of $812,302 or $0.01 per share from continuing operations in the same period in the prior year.

Exploration expenses during the quarter ended September 30, 2011 were $4,358 or 0.5% of our total expenses compared to $192,789 or 24% of our total expenses in the same period in the prior year. The decrease is due to Company resources being directed toward commencement of construction, with a majority of the costs incurred on the property being capitalized as construction in progress.

Management salaries and consulting fees in the quarter ended September 30, 2011 were $238,761 compared to $228,203 incurred in the quarter ended September 30, 2010. Total non-cash compensation expense due to the recognition of costs related to stock options was $80,143 in the quarter ended September 30, 2011 compared to the prior year's fiscal second quarter of $59,170. General and administrative costs increased to $234,577 compared to $208,098 the prior year's quarter as a result of increased investor relations activity. Legal and audit fees for the period were $66,853, a decrease from the prior year's quarter of $126,408. These costs decreased due to the capitalization of costs related to legal filings surrounding the financing activities to fund the construction in progress. Travel and accommodation costs during the quarter ended September 30, 2011 were $42,788, compared to $35,755 expended on travel in the prior year's comparable quarter.

Interest expense, net of capitalized interest, was $65,791 in the quarter ended September 30, 2011 compared to $280 in the same period in the prior year. This increase is due to the interest incurred on the promissory and convertible notes issued to reduce the potential future obligations under the royalty and the debt offering completed in July 2011. Subsequent to September 30, 2011, the Company placed the Borealis Oxide Heap Leach Project into production and shipped carbon loaded with gold and silver on October 13, 2011. Under the current agreement we expect to receive settlement and payment for gold and silver in approximately six weeks from the shipping date.

Six months ended September 30, 2011 compared to six months ended September 30, 2010

For the six months ended September 30, 2011, we had a net loss of $1,387,922 or $0.01per share from continued operations and nil from discontinued operations compared to a net loss of $1,840,604 or $0.02 per share from continued operations and net income of $635,708 or $0.01 per share from discontinued operations in the same period in the prior year.

Exploration expenses during the six months ended September 30, 2011 were $95,254, or 6.8% of our total expenses, compared to $578,429 or 31% of our total expenses in the prior year. The decrease is due to Company resources being directed toward commencement of construction, with a majority of the costs incurred on the property being capitalized as construction in progress.

Management salaries and consulting fees in the six months ended September 30, 2011 were $472,168 compared to $542,131 incurred in the 2010 six-month period. Total non-cash compensation expense due to the recognition of costs related to stock options was $98,651 compared to $99,210 in the six months ended September 30, 2010. Management salaries and consulting fees during the quarter decreased due to lower consulting fees and the capitalization of engineering staff salaries as part of construction in progress. General and administrative costs increased by $26,679 over the prior year's six-month period. Legal and audit fees for the period were $141,000 compared to $183,821. These costs decreased due to the capitalization of costs related to legal filings surrounding the financing activities to fund the construction in progress. Travel and accommodation costs during the six months ended September 30, 2011 were $93,261 compared to $69,293 expended on travel in the prior year's comparable quarter. The increase in travel and entertainment cost is due primarily to travel costs incurred associated with the increased corporate activity.

Interest expense, net of capitalized interest, was $85,602 in the six months ended September 30, 2011 compared to $873 in the same period in the prior year. This increase is due to the interest incurred on the promissory and convertible notes issued to reduce the potential future obligations under the royalty and the debt offering completed in July 2011.

Liquidity and Capital Resources

Our principal source of liquidity is cash raised by way of sale of common stock from treasury and other equity instruments, debt instruments or forms of securities.

Going Concern

The audit opinion for our financial statements for the fiscal year ended March 31, 2011 includes a going concern qualification. During the quarter ended June 30, 2011, we were successful in raising a net of $9,869,741 in cash from financing activities, and in the quarter ended September 30, 2011, we added an additional $3,169,514 in cash from a debt financing and currently as of September 30, 2011, had cash on hand of $2,716,799. These funds are earmarked to complete the construction of our Borealis Oxide Heap Leach Project and the Adsorption, Desorption, Recovery Plant (the "ADR"). There can be no assurance that we will achieve profitability or positive cash flow. Additional financing will be required to complete the ADR plant and fund working capital until cash from sales of gold begins to flow to the Company. Management is conducting negotiations with multiple parties to obtain the needed financing. If possible future revenues do not result in positive cash flow, and management is unable to raise additional capital, we will not be able to meet our obligations and may have to suspend or cease operations. No assurance can be given that we will be successful in achieving profitability, generating positive cash flow or raising additional capital through placements of debt or equity. We have an accumulated deficit of $39,338,723 as at September 30, 2011, ($37,950,801 as at March 31, 2011), and without positive operating cash flow or additional financing, we do not have sufficient cash on hand to fund normal operations for the next twelve months. These conditions raise substantial doubt about our ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classifications of liabilities that might be necessary should we be unable to continue as a going concern.

Royalty Obligations

On August 22, 2008, we entered into a 12-month option agreement, at a cost of $250,000, to amend the Borealis Property mining lease. If exercised, the net smelter return royalty rate would be fixed at 5%, versus the then current uncapped variable rate. Payment upon exercise was $1,750,000 in cash, 7,726,250 shares of our common stock (subject to obtaining approval from the TSX) and a three-year, $1,909,500 note payable bearing interest at 5% per annum. The option period could be, and was, extended for an additional six months for a payment of $125,000 that was settled through the issuance of shares of our common stock. On February 12, 2010, we entered into an agreement to extend the option agreement from February 22, 2010 until August 22, 2010, including an extension of the condemnation period from August 22, 2010 to August 22, 2011. As consideration for entering into the agreement, we agreed to pay $150,000 to Richard J. Cavell TTTEE F/T Richard J. Cavell Trust dated 02/23/1994 (which we refer to as the Cavell Trust), Hardrock Mining Company and John W. Whitney (the "Lessors") comprised of cash in the amount of $25,000 and shares of our common stock equal to $125,000, calculated based on eighty percent of the average five day closing price immediately prior to the payment date. On August 11, 2010, the option was extended until February 22, 2011 for a cash payment of $150,000.

On February 22, 2011, the option agreement was amended by agreement of the parties. The amended option agreement extended the option on a month-to-month basis for up to six months beginning February 22, 2011 in consideration of $25,000 per month payable by us to the Lessors. Under the terms of the amended option agreement, we agreed to exercise the option and fix the net smelter return royalty at 5% on the tenth business day following the closing of any offering by us to raise $8 million or more. In consideration of these amended terms, the Lessors agreed to accept a two year, 5% promissory note in the principal amount of $1.6 million in lieu of a portion of the original $1,750,000 cash payment that would have been due upon exercise of the option. Upon exercise of the option, we agreed to pay the Lessors:

(a) $150,000 in cash,

(b) promissory notes totaling $1.6 million bearing interest at 5% per annum,

(c) 5,000,000 shares of common stock at an agreed value of $0.40 per share, subject to approval of the TSX, and

(d) convertible promissory notes totaling $3 million bearing interest at 5% per annum.

On May 20, 2011, we agreed to an amendment to the option terms and exercised the option to fix the net smelter royalty at 5%. Under the terms of the amended option agreement, we paid the lessors aggregate consideration of $7,000,000 (less the $250,000 previously paid by Gryphon to the Lessors upon execution of the option agreement) as follows:

(a) $150,000 in cash;

(b) 7,726,500 shares of common stock at an agreed value of $0.40 per share (fair value $0.14, $1,081,675);

(c) 5% promissory notes in the aggregate principal amount of $1,600,000, due May 20, 2013, with installment payments due upon commencement of production on the Borealis property; and

(d) 5% convertible notes in the aggregate principal amount of $1,909,500, due May 20, 2014, convertible into shares of our common stock at $0.70 per share through May 20, 2012, $0.80 per share through May 20, 2013 and $0.90 per share through May 20, 2014.

At September 30, 2011, we had a negative working capital of $983,141. Current assets consisted of $2,716,799 in cash, $56,890 in accounts receivable, $386,554 in prepaid expenses, $638,184 in inventory, and $296,323 in debt issue costs. We had $1,957,463 in accounts payable and accrued liabilities, $265,208 in the current portion of the long-term debt, and $2,855,220 in notes payable, net of offering costs.

i will keep accumulating then until it does,lol. glta.


p.s.- hope its a couple of months.

go to post #6 and look at the 52 week hi-low.

no, i meant over 5 bucks pps in 2008. have you done your dd?

hopefully this gets back to a high of over 5.00pps like it was in 2008.

lol, not at all. i just really like whats happening here. they see losses till sept. i am getting impatient waiting for the results of the dig. its [imo] gonna be huge. glta.

i did some dd on this today and bought in @.075 and im very happy i got in @ this pps. glta.

this just gets better and better.

yes, please tell us the disadvantages of being in large chain stores has on asr's product.

the volume has been increasing in-which thats a great thing , being that there are that many more watchers and buyers. approx. 2 more weeks before this explodes. glta.

how sure are they that the shipments are loaded with gold and silver "This second production shipment totaled 2.7 wet tons of carbon loaded with gold and silver." i hope they are right and the carbon is fully loaded with gold and silver. im waiting for the spike up in approx. 3 weeks. glta.

imo, i also think thats an accurate estimation for the pps.

i too agree, :p

omg----According to sources in the company, Gryphon Gold will be shipping carbon columns bi-weekly from here on out and could report gold production figures sometime in the second half of November.
this is absolutely fantastic.

hope she feels better soon. this stock needs some kind of promotion. im glad its still undervalued so when i have a few extra bucks, instead of going out with my girl friend or my wife i buy a few more shares.lol. this is going to explode once those #'s come back in 4 weeks. hopefully there's more gold then they expect. again, hope your lil one feels better soon and there's alot more gold in that mix that they sent out. glta.

not that im putting a damper on things, but it is wet. i am very satisfied with whats going on. glta ;]

whats holding this down, im happy with my position. hope all are happy as well with theirs. glta. very exciting stuff going on. ;]

what is holding gyph back. it should be around .44-.45 by this time. way,way,way undervalued.glta

once again, good news after good news and nothing happens. itro imo isn't worth investing in. it seems as if, its dead in the water. what great potential it has/had. glta.

they are on schedule, below budget, and drilling for gold and silver. how much better can this get. ;]

why the drop????????????????????????

i believe asfx has been up-listed..............

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wow, in 9 days its going to be 2 years that ipwg has been UN-able to trade. 2 F'n years. now what are the investors supposed to do, nothing. someone needs to get a lawyer and start a class action suit. i would , but im not a big holder of stock, just a few million. i know that there are much bigger investors here. thanks.

it seems as though there is either more eyes seeing gyph or the investors are buying more like myself. im very satisfied with this stock. ;] glta.

yes it is, gyph is moving slow but it is moving in them right direction. when gyph comes out with positive findings with the mining, boy, this is gonna skyrocket. glta.

i do not post here much, but when i see that asfx is expanding and no-one else has commented on it i wonder why. most here that post all the time are very down with asfx and i understand, but now that asfx is proving to be making the efforts that we[investors]have been waiting for. why not try to support your[our]investment and start promoting asfx instead of bashing it. imo, asfx is going to pr the right news at the right time and sky-rocket. im in for more. good luck to all investors in asfx.

im just hoping gyph gets the attention it deserves. this is way under valued. management needs to promote and get the big time investors. glta

i also buy and hold with this one. i think your expectations are a Lil low. if gold and silver can hold at the level they are at now in-which IMO i think they will and exceed, this stock could see 8 - 10 PPS. IMO gyph has been undervalued for awhile now. i am very excited about this one. don't hold too long, it is still a penny stock. good luck to you and all investors in gyph

fed was and still is right about this pos investment. nothing but b/s. what a joke. do not tell me to sell. to much of a lost.

gyph, needs to promote big time. this is a way under valued penny stock. i can only buy so much. and what a great buy it is...

whats your make on this. it came out at 5:30 today monday 9/15/11................................


Form 10-Q for AMERICAN SCIENTIFIC RESOURCES INC

15-Aug-2011

Quarterly Report


Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

This quarterly report on Form 10-Q and other reports filed by American Scientific Resources, Inc. ("we," "us," "our," or the "Company") from time to time with the U.S. Securities and Exchange Commission (the "SEC") contain or may contain forward-looking statements (collectively the "Filings") and information that are based upon beliefs of, and information currently available to, the Company's management as well as estimates and assumptions made by Company's management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the Filings, the words "anticipate," "believe," "estimate," "expect," "future," "intend," "plan," or the negative of these terms and similar expressions as they relate to the Company or the Company's management identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.

Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results.

Our financial statements are prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). These accounting principles require us to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management's judgment in its application. There are also areas in which management's judgment in selecting any available alternative would not produce a materially different result. The following discussion should be read in conjunction with our consolidated financial statements and notes thereto appearing elsewhere in this report.

Plan of Operation

We provide healthcare and medical products distributed globally primarily to retail drug chains, retail stores specializing in sales of products for babies, medical supply dealers and over the internet. Effective January 1, 2011, the Company closed the accounts of Kidz-Med, Inc. and made the subsidiary inactive. The Company currently sells all products through the parent company, American Scientific Resources, Incorporated, utilizing the VeraTemp, VeraTemp+, Disintegrator and Kidz-Med brand names.

The Company is currently selling its products, primarily the VeraTemp and VeraTemp+ thermometers, through retailers such as Giant Supermarkets, Lucky Supermarkets, Save Mart, C&S Grocers, CVS Pharmacy, Duane Reade, Bartell Drugs, Fred Meyer, Price Chopper and internet sites such as Amazon.com, Walmart.com, CVS.com, Costco.com, Target.com, Rite-aid.com, DrugStore.com, Diapers.com, Pamida and through wholesalers and medical supply dealers such as Cardinal Health, Amerisource Bergen, School Health, Henry Schien and McKesson Surgical. The Company has recently shipped products to, or entered into agreements with, foreign distributors located in Canada, Chile, France, Israel, Lebanon, Thailand and the United Kingdom. The Company received and shipped its first 2,000 unit order of the VeraTemp thermometer in September 2010 and has subsequently received, assembled and shipped approximately 20,000 units. As of June 30, 2011, the Company had placed deposits amounting to $252,000 with suppliers in order to procure 38,000 units. As of the date of this report, the Company has received and assembled 23,000 of these units and the remaining 15,000 units are in transit from China.

The Company began assembly and packaging of the VeraTemp thermometer and the Disintegrator Plus during 2010. The Company was conducting such assembly and packaging at, and fulfilling most retail, wholesale and internet orders from, a warehouse facility located in Chagrin Falls (near Cleveland), Ohio. During the second quarter of 2011, the Company moved its assembly and packaging operating to a warehouse facility in Boca Raton, Florida.

On February 4, 2011, the Company issued an aggregate of 50,000 shares of its Series A Preferred Stock in equal amounts of 12,500 shares to each of its four directors. The Series A Preferred Stock entitles the holder to 100,000 votes for each share of preferred stock owned giving the directors control of the Company. On February 11, 2011, the Company increased the number of authorized shares of its common stock from 2.5 billion to 5.0 billion. On March 21, 2011, the Company completed a 200-to-1 reverse common stock split. All share and per share amounts shown in this Item 2. - Management's Discussion and Analysis of Financial Condition and Results of Operations are adjusted for the effects of the reverse stock split. On July 21, 2011, the Company decreased the number of common shares authorized from 5.0 billion to 500 million.

During the next 12 months, the Company intends to raise funds from borrowings and sales of its common stock to fund purchases, assembly and distribution of its products and generally accelerate its growth.

Results of Operations

For the Three Months Ended June 30, 2011 Compared to the Three Months Ended June
30, 2010

Three Months Ended June 30, Change
2011 2010 $ %

Product sales, net $ 222,129 $ 137,528 $ 84,601 61.5 %
Cost of goods sold (142,573 ) (95,045 ) (47,528 ) 50.0 %
Inventory adjustment - (63,194 ) 63,194 100.0 %
Gross profit 79,556 (20,711 ) 100,267 484.1 %

Operating, sales and administrative
expenses (2,598,463 ) (717,930 ) (1,880,533 ) -261.9 %

Net loss from operations (2,518,907 ) (738,641 ) (1,780,266 ) -241.0 %

Other income (expense):
Interest expense (551,778 ) (416,439 ) (135,339 ) -32.5 %
Change in fair value of derivative
instruments (711,000 ) 831,044 (1,542,044 ) -185.6 %
Loss on settlement of debt - (478,262 ) 478,262 100.0 %
Charge resulting from triggered
anti-dilution
provisions within financial
instruments (187,416 ) - (187,416 ) n/m
Other expenses (40,596 ) (12,000 ) (28,596 ) -238.3 %
Total other income (expense) (1,490,790 ) (75,657 ) (1,415,133 ) -1870.5 %

Net loss applicable to common
shareholders $ (4,009,697 ) $ (814,298 ) $ (3,195,399 ) -392.4 %


Weighted average number of common shares outstanding, basic and diluted (2010 pro forma

adjusted for 200-to-1 reverse common
stock split) 13,245,965 9,477,805

Basic and diluted net loss per common
share $ (0.30 ) $ (0.09 )


Net Revenues

Net revenues from product sales for the three months ended June 30, 2011 were $222,129, an increase of approximately $85,000 or 62% from net revenues of $137,528 for the same period in 2010. A majority of our revenues for the three months ended June 30, 2011 were derived from sales of the VeraTemp and VeraTemp+, while sales for the same three month period in the previous year consisted of sales of the Thermofocus 5-in-1 thermometer. During the three months ended June 30, 2011 and 2010, most sales were made to retailers, wholesalers and individuals over the internet. The Company ceased actively selling the Thermofocus during 2010, and began discounting the remaining Thermofocus units carried in inventory during the second quarter of 2010. An inventory adjustment of $63,194 was recorded during the second quarter of 2010 to write-down the book value or the Thermofocus inventory. During the third quarter of 2010, the Company began selling and distributing its new VeraTemp and VeraTemp+ thermometers, and its new Disintegrator Plus needle and lancet destruction device. The VeraTemp products have a lower cost of production than the Thermofocus and therefore a lower selling price. Comparing sales during the three months ended June 30, 2011, to the same three month period in 2010, per unit pricing for the VeraTemp products was significantly less than that of the Thermofocus despite discounting of the Thermofocus thermometers.

Sales

During the three months ended June 30, 2011, the Company's sales were adversely impacted by the Court ordered recall of the VeraTemp, which required a change in packaging (see Note 11 - Commitments and Contingencies - Litigation in the Notes to Interim Condensed Consolidated Financial Statements), but to a lesser extent than the first quarter of 2011. During the three months ended June 30, 2011, the Company reversed $22,304 of previously recognized revenue compared to $61,904 of lost sales for the first quarter of 2011. Had these thermometers not been returned, net revenues for the three months ended June 30, 2011 would have been $244,433, compared to $137,528 during the same period in 2010. Customers generally returned the units in the infringing packaging for thermometers in new packaging, or cancelled their order and received cash refunds.

For the three months ended June 30, 2011, approximately 20% of the Company's net revenue was generated from sales of the VeraTemp thermometer through various online retailers (such as Amazon and CVS.com). Sales to an international wholesaler, a domestic wholesaler and a major retailer pharmacy chain accounted for 21%, 16% and 11%, respectively, of our net revenue during the three months ended June 30, 2011. No other single customer accounted for more than 10% of our revenue during the three months ended June 30, 2011. As of June 30, 2011, the Company had received payment or advance deposits for its products in the amount of $97,025 for which the products had not been shipped, and accordingly revenue recognition was deferred.

The Company had several sales to international customers during the second quarter of 2011. Approximately 38% of the Company's sales during the three months ended June 30, 2011, were made to customers outside the United States. International sales are expected to continue to grow in the coming year. All such sales have been denominated in U.S. dollars.

Gross Profit

Gross profit for the three months ended June 30, 2011 was $79,556, up from a negative gross profit of $20,711 for the same period in 2010. However, adjusting for the thermometer sales returned for re-packaging, gross profit for the quarter would have been moderately higher. Gross profit as a percentage of net revenue for the three months ended June 30, 2010 was 36% compared to 31% for the same three month period last year excluding the 2010 inventory adjustment. During 2010, the Company began phasing out distribution of the Thermofocus thermometer due in part to falling customer demand and high product costs, and began accepting orders for the new VeraTemp thermometer.

Expenses

Operating, sales and administrative expenses amounted to $2,598,463 for the three months ended June 30, 2011, compared to $717,930 for the same period in 2010. The $1.88 million, or 262%, increase resulted primarily from the issuance of stock options valued at $1.69 million to directors, employees and professional advisors for past services. The Company also incurred higher professional fees (primarily stock-based compensation) of approximately $23,000, higher advertising and promotion costs of approximately $18,000, higher office and relocation costs of approximately $15,000 offset by lower patent amortization costs of $39,000. During the second quarter of 2010, the Company reversed approximately $107,000 of expenses previously deemed payable to various vendors and creditors.

At December 31, 2010, the Company determined that, due to capital constraints and other factors, cash flows from the Disintegrator? would not be realized and therefore the value of the patent was impaired. On December 31, 2010, the Company recorded a patent impairment charge of $1,749,664 to write-down the carrying value of the patent to $639,138 representing the present value of expected future cash flows over the remaining life of the patent. During the three months ended June 30, 2011, the Company recognized patent amortization expense of $13,996 compared to $52,694 during the same period in 2010.

Interest Expense

Interest expense was $551,778 for the three months ended June 30, 2011, compared to $416,439 for the same three month period in 2010. During the three months ended June 30, 2011, we recognized approximately $102,000 as interest expense for warrants granted to extend the payment dates of debt obligations. During the same period in 2010, we recognized approximately $225,000 as interest expense related to the initial recording of derivative liabilities imbedded within certain of warrants and conversion features attached to the second quarter 2010 convertible debt issuances. During the three months ended June 30, 2011, we incurred approximately $169,000 of interest expense related to the amortization of debt discounts compared to $100,000 for the same period in 2010. As a result of the Company's inability to pay interest when due, the Company incurred penalty interest expenses during the three months ended June 30, 2011 of approximately $105,000, compared to approximately $42,000 for the same three month period a year ago. In addition, due to the various issuances comprising the second quarter 2011 inventory notes and a convertible note, we recognized additional interest expense during the three months ended June 30, 2011. Offsetting this increase, during the three months ended June 30, 2011, principal outstanding on various interest-bearing notes was reduced through several conversions to equity resulting in reductions of interest expense.

Gains and Losses related to Debt Instruments and Derivative Liabilities

On May 4, 2011, we incurred a non-cash charge of $187,419 due to the issuance of 1,041,667 warrants to protect an investor from dilution as a result of the Company adjusting the conversion price for certain convertible debt to $0.10 per common share. The warrants were valued using the Black-Scholes pricing model. The reduction was made in order to induce a noteholder to convert a portion of a debt obligation to common equity. In addition, as a result of adjusting the conversion price to $0.10 per share, changes in the market price of our common stock and other valuation factors, we incurred an aggregate non-cash loss of $711,000 for the three months ended June 30, 2011 as the net change to the fair value of our derivative liabilities. Due primarily to an increase in the trading price of our common stock from May 4, 2011 to June 30, 2011, the value of the derivative liability associated with the 1,041,667 warrants increased by approximately $280,000 (of the $711,000 total change for the quarter). As a result of decreases in the trading price of our common stock during the second quarter last year, and a stock price decrease from issuance of convertible debt to quarter-end, we recognized a non-cash gain of approximately $831,000 during the second quarter of 2010 as the net change in the value of our derivative instruments.

In June 2010, we recognized a loss of $478,262 on the settlement of a debt obligation.

Net Loss

The net loss applicable to common shareholders was $4,009,697 for the three months ended June 30, 2011 compared to net a loss of $814,298 for the same three month period in 2010. As discussed above, the significantly higher net loss was primarily due to (i) the expensing of stock options issued to directors, employees and professional advisors, (ii) the charge resulting from triggered anti-dilution provisions within certain convertible debt agreements, (iii) fair value changes within derivative instruments, (iv) higher interest expenses, (v) higher other operating, sales and administrative expenses, offset by higher gross profits on sales of our products.

For the three months ended June 30, 2011 and 2010, the basic and diluted loss per common share was $0.30 and $0.09, respectively, after adjustment for the 200-to-1 reverse common stock split. The second quarter 2011 to second quarter 2010 comparison of net loss per common share is impacted by the approximate 40% increase in the weighted average number of shares outstanding due to numerous issuances of common stock to fund operations.

For the Six Months Ended June 30, 2011 Compared to the Six Months Ended June 30,

2010

Six Months Ended June 30, Change
2011 2010 $ %

Product sales, net $ 323,376 $ 313,151 $ 10,225 3.3 %
Cost of goods sold (235,197 ) (176,812 ) (58,385 ) 33.0 %
Inventory adjustment - (63,194 ) 63,194 100.0 %
Gross profit 88,179 73,145 15,034 20.6 %

Operating, sales and administrative
expenses (3,169,577 ) (1,319,675 ) (1,849,902 ) -140.2 %

Net loss from operations (3,081,398 ) (1,246,530 ) (1,834,868 ) -147.2 %

Other income (expense):
Interest expense (1,235,342 ) (1,403,980 ) 168,638 12.0 %
Change in fair value of derivative
instruments (818,545 ) 862,958 (1,681,503 ) -194.9 %
Loss on settlement of debt - (478,262 ) 478,262 100.0 %
Charge resulting from triggered
anti-dilution
provisions within financial
instruments (854,560 ) - (854,560 ) n/m
Other expenses (152,899 ) (27,960 ) (124,939 ) -446.8 %
Total other income (expense) (3,061,346 ) (1,047,244 ) (2,014,102 ) -192.3 %

Net loss applicable to common
shareholders $ (6,142,744 ) $ (2,293,774 ) $ (3,848,970 ) -167.8 %


Weighted average number of common shares outstanding, basic and diluted (2010 pro forma

adjusted for 200-to-1 reverse common
stock split) 12,200,452 9,511,658

Basic and diluted net loss per common
share $ (0.50 ) $ (0.24 )


Net Revenues

Net revenues from product sales for the six months ended June 30, 2011 were $323,376, an increase of approximately $10,000 or 3% from net revenues of $313,151 for the same period in 2010. A majority of our revenues for the six months ended June 30, 2011 were derived from sales of the VeraTemp and VeraTemp+, while sales for the same six month period in the previous year consisted of sales of the Thermofocus 5-in-1 thermometer. During the six months ended June 30, 2011 and 2010, most sales were made to retailers, wholesalers and individuals over the internet. The Company ceased actively selling the Thermofocus during 2010. During the third quarter of 2010, the Company began selling and distributing its new VeraTemp and VeraTemp+ thermometers, and its new Disintegrator Plus needle and lancet destruction device. Comparing sales during the six months ended June 30, 2011 to the same six month period in 2010, average per unit pricing for the VeraTemp was less than that of the Thermofocus, however, the Company sold more units of the VeraTemp products during the first half of 2011 than it sold of the Thermofocus during the same six month period last year.

Sales

During the six months ended June 30, 2011, the Company's sales were adversely impacted by the Court ordered recall of the VeraTemp, which required a change in packaging (see Note 11 - Commitments and Contingencies - Litigation in the Notes to Interim Condensed Consolidated Financial Statements). During the six months ended June 30, 2011, $84,208 of thermometer sales were reversed due to product returns for re-packaging. Had these thermometers not been returned, net revenues for the six months ended June 30, 2011 would have been $407,584, compared to $313,451 during the same period in 2010. In certain cases, customers who had received the thermometer in the infringing packaging, delayed receipt of the re-packaged product (in some cases into the second and third quarters) or cancelled their order. The Company experienced delays fulfilling orders until new packaging material was obtained. As of June 30, 2011, the Company had received payment or advance deposits for thermometers in the amount of $97,025 for which the product had not been shipped, and accordingly revenue recognition was deferred. In addition to delayed or permanently lost sales, the Company has incurred approximately $30,500 of expenses directly related to the packaging recall.

For the six months ended June 30, 2011, 28% of the Company's net revenue was generated from sales of the VeraTemp thermometer through various online retailers (such as Amazon and CVS.com). During the first quarter of 2011, a portion of the Company's revenues resulted from sales of old or slow moving products at significantly discounted prices resulting in slightly negative gross margins. No such discounted sales took place during the second quarter of 2011. Sales to a domestic wholesaler, an international wholesaler and a discount retailer accounted for 19%, 14% and 11%, respectively, of our net revenue during the six months ended June 30, 2011. No other single customer accounted for more than 10% of our revenue during the six months ended June 30, 2011.

The Company has had several sales to international customers to date. Approximately 31% of the Company's sales during the six months ended June 30, 2011, were made to customers outside the United States. International sales are expected to continue to grow in the coming year. All such sales have been denominated in U.S. dollars.

For the six months ended June 30, 2011, the Company sold more VeraTemp thermometer products than Thermofocus thermometers sold in the same six month period last year. However, the average selling price per unit for the VeraTemp thermometers was lower than that of the Thermofocus thermometers.

Gross Profit

Gross profit for the six months ended June 30, 2011 was $88,179, up from $73,145 for the same period in 2010. However, adjusting for the approximately $84,000 of thermometer sales reversed and returned for re-packaging, gross profit would have improved. Gross profit as a percentage of net revenue for the six months ended June 30, 2010 was 27%, compared to 44% for the same six month period a year ago excluding the inventory adjustment. During the first quarter of 2011, the Company sold the remaining Thermofocus units and various other slow moving products at negative gross margins. During 2010, the Company began phasing out distribution of the Thermofocus thermometer due in part to falling customer demand and high product costs, and began accepting orders for the new VeraTemp thermometer.

Expenses

Operating, sales and administrative expenses amounted to $3,169,577 for the six months ended June 30, 2011, compared to $1,319,675 for the same period in 2010. The $1.85 million, or 140%, increase resulted primarily from the issuance of stock options valued at $1.69 million to directors, employees and professional advisors for past services. In addition, for the six months ended June 30, 2011, the Company incurred higher advertising and promotion costs of approximately $54,000 and higher salaries and wages of approximately $53,000, offset by lower patent amortization costs of $77,000. Total employee compensation costs of $476,000 for the six months ended June 30, 2011, were $56,000 higher than the same period in 2010 due primarily to higher base salaries and employee hours incurred, offset by lower amortization of contingent compensation. Professional fees for marketing, investor relations, legal and accounting services were essentially unchanged, amounting to $745,000 for the six months ended June 30, 2011, compared to $744,000 for the same period in 2010. Expenses for professional fees consisted of cash payments and stock based compensation for each six month period. During the second quarter of 2010, the Company reversed approximately $107,000 of expenses previously deemed payable to various vendors and creditors.

At December 31, 2010, the Company determined that, due to capital constraints and other factors, cash flows from the Disintegrator? would not be realized and therefore the value of the patent was impaired. On December 31, 2010, the Company recorded a patent impairment charge of $1,749,664 to write-down the carrying value of the patent to $639,138 representing the present value of expected future cash flows over the remaining life of the patent. During the six months ended June 30, 2011, the Company recognized patent amortization expense of $27,991 compared to $105,338 during the same period in 2010.

Interest Expense

Interest expense was $1,235,342 for the six months ended June 30, 2011, compared to $1,403,980 for the same six month period in 2010. During the six months ended June 30, 2011, we recognized $258,000 as interest expense related to adjustments to conversion rates to induce holders of our convertible debentures to convert to common stock. During the same period in 2010, we recognized approximately $1,080,000 as interest expense related to the initial recording of derivative liabilities imbedded within certain of warrants and conversion features attached to the first and second quarter 2010 convertible debt issuances. During the six months ended June 30, 2011, we recognized $357,000 as interest expense for common shares and warrants granted to extend the payment dates of debt obligations. In addition, during the six months ended June 30, 2011, we incurred approximately $276,000 of interest expense related to the amortization of debt discounts compared to $145,000 for the same period in 2010. As a result of the . . .