What changed in this filing

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Item 1A. Risk Factors

2021-05-14 compared with 2020-11-23 · 86 added, 74 removed, 336 unchanged (32% of the section changed)

Risk Factors.

Related to our Business and Operations

occurrence of an uncontrollable event such as the COVID-19 pandemic may negatively affect our operations and ability to file timely

and accurate financial information.

significant portion of the Company’s business, financial and governance operations are contracted with certain independent

contractors and third-parties currently on “lock-down”

orders or “shelter in place”

recommendations related

to the national health crisis created by the COVID-19 pandemic, including key people responsible for assisting the Company in

the development of its financial statements.

As a result of the travel and work restrictions stemming from the COVID-19 pandemic,

the Company may be unable to fully review and certify certain financial statements that it needs to permit the Company to file

timely and accurate quarterly Reports on Form 10-Q, including for the quarter ended September 30, 2020, by the prescribed dates

without undue hardship and expense to the Company.

massive and currently unknown short- and long-term economic impacts of COVID-19 may impact our business and ability to raise capital.

and its current extraordinary impact on the world economy has reduced oil consumption globally, decreasing crude oil prices, to

levels not seen since the early 1980’s.

The economics of GTL conversion rely in part on the arbitrage between oil and natural

gas prices, with economic models for many producers, including our own models, using a range of $30-60/bbl (for WTI or Brent Crude

as listed daily on the Nymex and ICE commodities exchanges) to determine relative profitability of their GTL operations.

COVID-19 may run its human course in the near term, we believe as many others in the U.S.

government and media believe, that the

economic impacts will be long lasting and for all practical matters, remain largely unknown at this time.

may not be able to raise the additional capital necessary to execute our business strategy, which includes the production, sale

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to the inherent risk of commercializing new technology, there can be no assurance that we will earn net income in the future.

We may require additional capital in order to fund our operations, which it may not be able to source on acceptable terms.

We will require additional capital in order to fund our operations, which it may not be able to source on acceptable terms.

revenues and achieving profitability will depend on our ability to fully develop, certify and commercialize our GTL Technology,

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resources, our management cannot be certain that we will be able to compete successfully in our operations.

longevity of patents in the United Sates is limited in duration and may affect the Company’s long-term ability to successfully

monetize the intellectual property it owns.

of September 30, 2020, we own United States Patents Nos.

8,574,501 B1, originally issued November 5, 2013 and 8,795,597 B2, issued

August 5, 2014, covering our GTL conversion technology for the purpose of converting natural gas to clean synthetic fuels in a

small-plant and mobile application.

The term of each patent under U.S.

the longevity of patents in the United States are limited in duration to 21 years, this should not affect the Company’s

long-term ability to successfully monetize the intellectual property it owns.

of March 31, 2021, we own United States Patents Nos.

8,574,501 B1, originally issued November 5, 2013 and 8,795,597 B2,

issued August 5, 2014, covering our GTL conversion technology for the purpose of converting natural gas to clean synthetic fuels

in a small-plant and mobile application.

On April 28, 2020, the Company was issued a new U.S.

Patent 10,633,594 B1 for syngas

generation for gas-to-liquid fuel conversion.

The Company has several other pending patent applications, both domestic and international,

related to various components and processes involving our proprietary GTL methods, which when granted, will further complement

our existing portfolio of issued patents and pending patent applications.

February 2021, the Company was issued Patent 10,907,104, the fourth patent relating to the company’s proprietary G-Reformer™

technology which allows for the conversion of natural gas into synthesis gas.

The newly issued patent extends the methods and

details of generating syngas using the apparatus described in a previously issued patent No.

10,633,594, the company’s third

As described in the patent, methane, oxygen, and steam are continuously injected into the combustion section of the apparatus

to generate carbon monoxide along with unreacted methane and steam.

The carbon monoxide, unreacted methane, and steam then enter

the catalyst chamber where these components react to generate syngas.

The pressure inside the reaction vessel is controlled at

no higher than 5 psig.

term of each patent under U.S.

law is 21 years.

Accordingly, each of these patents will

expire in the years 2034 and 2035 respectively, unless they are modified with “improvements to the current art”

us, in which case their useful lives may be extended.

There is no certainty that we will be able to make such improvements to

our currently held patents, and they therefore may expire at their respective terms.

Alternatively, a patent’s term may

be shortened if a patent is terminally disclaimed (litigated) over a commonly owned patent or a patent naming a common inventor

has an earlier expiration date.

There is no certainty that we will be able to successfully defend our patents if such claims are

made, and they may expire prior to their respective terms.

Accordingly, each of these patents will expire in the years 2034, 2035 and 2041

respectively, unless they are modified with “improvements to the current art”

by us, in which case their useful lives

may be extended.

There is no certainty that we will be able to make such improvements to our currently held patents, and they

therefore may expire at their respective terms.

Alternatively, a patent’s term may be shortened if a patent is terminally

disclaimed (litigated) over a commonly owned patent or a patent naming a common inventor has an earlier expiration date.

is no certainty that we will be able to successfully defend our patents if such claims are made, and they may expire prior to

their respective terms.

are currently dependent on one equipment fabricator, the loss of which could adversely impact our operations.

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are dependent on a limited number of key executives, consultants, the loss of any of which could negatively impact our business.

business is led by an interim President, Kent Harer, and our Chief Financial Officer, Ransom Jones, both of whom are also members

of our Board of Directors.

Our engineering efforts are led by Thomas Phillips, who is also Vice President of Operations for GIE,

but we use outside consultants to support and perform the majority of the engineering and production work on our GTL technology.

We have also contracted with other senior consultants to provide sales, financial reporting and governance support.

business is led by President, Kent Harer, and our Chief Financial Officer, Ransom Jones, both of whom are also members of our

board of directors (our “

Board of Directors ”).

We use outside consultants to support and perform the majority

of the engineering and production work on our GTL technology.

We have also contracted with consultants to provide financial reporting

and governance support.

one or more of these senior executives, officers, or consultants are unable or unwilling to continue in their present positions,

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and senior officers in our industry is intense, the pool of qualified candidates is limited, and we may not be able to retain

the services of our senior executives, key personnel, or senior consultants or attract and retain high-quality personnel in the

Such failure could materially and adversely affect our future growth and financial condition, and the loss of one or more

of these key personnel could negatively impact our business and operations.

our sponsored research and development agreement with UTA is terminated, we may lose access to certain of the scientists that

were instrumental in developing our technology.

support our engineering efforts, we entered into a confidential SRA with UTA starting in October 2009 and continuing with confidential

Scope of Work addendums added through today to develop and enhance our patented GTL system with the goal of developing commercial

GTL plants to convert natural gas into liquid fuels.

the services of our senior executives, key personnel, or consultants or attract and retain high-quality personnel in the future.

Such failure could materially and adversely affect our future growth and financial condition, and the loss of one or more of these

key personnel could negatively impact our business and operations.

our research and development agreements with UTA are terminated, we may lose access to certain of the scientists that were instrumental

in developing our technology.

order to safe guard against this possibility, on December 8, 2020, the Company announced an exclusive worldwide patent licensing

agreement with the University of Texas at Arlington (UTA) for all patent applications currently filed with the Patent and Trademark

Office relating to GWTI’s natural gas reforming technologies developed under its sponsored research agreement with UTA.

support our engineering efforts, we also continued our ongoing confidential Sponsored Research Agreement (“SRA”) with

UTA which began in October 2009 and has continued in various forms through today, adding confidential Scope of Work addendums

over this period to develop and enhance our patented GTL system with the goal of developing commercial GTL plants to convert natural

gas into liquid fuels.

We use UTA as an external research and development arm for the Company.

we or UTA were to terminate our relationship, we might lose access to the scientists most familiar with our unique technology.

If we or UTA were to terminate

our relationship for some extenuating circumstances, we might lose access to the scientists most familiar with our unique technology.

There is no assurance that we would be able to continue to improve on the technology we have developed thus far, potentially slowing

down our commercialization and financing efforts.

down our future commercialization and financing efforts.

quarterly results may fluctuate substantially and if we fail to meet the expectations of our investors or analysts, our stock

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cause us to cease operations and/or declare bankruptcy.

venture partner, OPMGE carries General Liability and Premises insurance.

JV partner, OPMGE carries General Liability and Premises insurance.

In the event we should have operations on future customer

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laws and regulations.

we are considered a “green energy”

technology, our business is particularly subject to federal and state laws and

regulations with respect to the oil and gas and mining industries.

Our success depends in part on our ability to anticipate, navigate

and respond to any changes that might occur.

Due to our currently limited financial resources, we might not be able to respond

to unanticipated changes, should they occur and impact our operations, and therefore have to cease operations.

business is particularly subject to federal and state laws and regulations with respect to the oil and gas and mining industries.

Our success depends in part on our ability to anticipate, navigate and respond to any changes that might occur.

Due to our currently

limited financial resources, we might not be able to respond to unanticipated changes, should they occur and impact our operations,

and therefore have to cease operations.

of terrorism, responses to acts of terrorism and acts of war may impact our business and our ability to raise capital.

acts of war or terrorism, national or international responses to such acts, and measures taken to prevent such acts may harm our

ability to raise capital or our ability to operate, especially to the extent we may later depend upon activities conducted in

foreign countries.

In addition, the threat of future terrorist acts or acts of war may have effects on the general economy or

on our business that are difficult to predict.

We are not insured against damage or interruption of our business caused by terrorist

acts or acts of war, and thus, our financial operations may be materially impacted by such events.

ability to raise capital or our ability to operate, especially to the extent we depend upon activities conducted in foreign countries.

In addition, the threat of future terrorist acts or acts of war may have effects on the general economy or on our business that

are difficult to predict.

We are not insured against damage or interruption of our business caused by terrorist acts or acts of

war, and thus, our financial operations may be materially impacted by such events.

massive and currently unknown short- and long-term economic impacts of COVID-19 may impact our business and ability to raise capital.

and its current extraordinary impact on the world economy has reduced oil consumption globally, decreasing crude oil prices, to

levels not seen since the early 1980’s.

The economics of GTL conversion rely in part on the arbitrage between oil and natural

gas prices, with economic models for many producers, including our own models, using a range of $30-60/bbl (for WTI or Brent Crude

as listed daily on the Nymex and ICE commodities exchanges) to determine relative profitability of their GTL operations.

to date the Company has not been required to stop operating, management is evaluating its use of its office space, virtual meetings

and the like.

The Company continues to monitor the impact of the COVID-19 outbreak closely.

The extent to which the COVID-19 outbreak

will impact our operations, the operations of OPMGE and/or ability to obtain financing or future financial results is uncertain.

may fail to establish and maintain strategic relationships.

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have a substantial amount of indebtedness, which requires significant interest payments.

As of September 30, 2020, we had total

liabilities of $8,486,991, including $2,284,583 of current debt owed to related parties (net of debt discounts totaling

$26,389), bearing an average cash interest of 17.1% per year.

We also have additional long-term liabilities of $525,000, in the

form of a 3-year interest-only note payable, bearing interest at 7.7%, paid semi-annually, with principal and accrued interest

As of March 31, 2021, we had $5,832,708

of total accrued current liabilities and $3,432,734 of current debt (net of debt discounts totaling $11,625), bearing an average

cash interest of 17.8% per year when current and 18% default interest when any such loans are not current.

As of the date of this

Form 10-Q, we are in default of loans totaling $691,667, of which $525,000, is in the form of a 3-year interest-only note payable,

due in July 2022.

For more details on our indebtedness, please see Notes 5 and 6 to our Financial Statements.

For more details on our indebtedness, please see Notes 5 and 6 herein above.

substantial level of indebtedness could have important consequences, including the following:

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors