Someone with some intelligence on this board please address this on the financial statements just issued....
Please address why none of the issues management reported today are an issue???? Thanks.
Then I will assess your answer and tell you if we are going to FLY!!!!! soon!
There is substantial doubt concerning our ability to continue as a going
concern.
GS Carbon had approximately $7,736 in cash at June 30, 2007 and had current
liabilities totaling $7,287,150. These matters raise substantial doubt about GS
Carbon's ability to continue as a going concern. Management's plans include
raising additional proceeds from debt and equity transactions and completing
strategic acquisitions.
The issuance of shares under our agreements with Candent and Cornell/Highgate
could increase their holding to over 80% of the total common shares outstanding.
While Candent and Cornell/Highgate are subject to restrictions on conversion of
their respective debentures limiting their ownership to 4.9% of our common stock
at any given time, upon default the Cornell and Highgate Debentures, along with
the outstanding options and warrants, could be converted into approximately
3,716,116,322 shares at the market price on June 30, 2007. The issuance of these
shares would dilute the interest of our current shareholders and provide
Cornell/Highgate with over 80% of the common shares outstanding. Such issuances
would reduce the percentage of ownership of our existing common stockholders and
could, among other things, depress the price of our common stock. This result
could detrimentally affect our ability to raise additional equity capital. In
addition, the sale of these additional shares of common stock may cause the
market price of our stock to decrease.
We may be unable to satisfy our current debts.
Our total liabilities as of June 30, 2007 were $9,861,568. We cannot afford to
pay these amounts out of our operating cash flows and our ability to operate
will be significantly impaired if we cannot reduce the Cornell and Highgate debt
with registered stock.
We are liable for approximately $498,000 in previously unreported debt.
In its Annual Report on Form 10-KSB for the year ended December 31, 2006 GS
Carbon disclosed in Note 13 to the Financial Statements the following:
A subsidiary of GS Carbon that was spun-off from GS Carbon in 2006 issued
debt instruments in the principal amount of $498,074 several years ago. We
recently were presented with evidence that GS Carbon may be liable for
payment of the debts. Management is actively investigating the facts and
circumstances with respect to the debts, and is not able to determine at
this time if GS Carbon has liability for the debts.
On July 26, 2007, the Company determined it was liable for approximately
$498,000 of convertible debt along with approximately $59,000 of related
derivative liabilities at the acquisition date and that it existed at December
31, 2006 and March 31, 2007. The Company will restate its December 31, 2006 and
March 31, 2007 financial statement as a result of these omissions.
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